Finward Bancorp (NASDAQ:FNWD) (the "Bancorp"), the holding company for Peoples Bank (the "Bank"), today announced that net income available to common stockholders was $2.2 million, or $0.50 per diluted share, for the quarter ended June 30, 2025, as compared to $455 thousand, or $0.11 per diluted share, for the quarter ended March 31, 2025. Selected performance metrics are as follows for the periods presented:

Performance Ratios
	Quarter ended
	6/30/2025		3/31/2025		12/31/2024		9/30/2024		6/30/2024
Return on equity	5.66	%	1.17	%	5.39	%	1.60	%	0.39	%
Return on assets	0.42	%	0.09	%	0.41	%	0.12	%	0.03	%
Net interest margin, tax-equivalent (non-GAAP)	3.11	%	2.95	%	2.79	%	2.66	%	2.67	%
Non-interest income/average assets	0.53	%	0.43	%	0.72	%	0.55	%	0.50	%
Non-interest expense/average assets	2.90	%	2.81	%	2.75	%	2.80	%	2.79	%
Efficiency ratio	88.92	%	93.11	%	87.20	%	97.32	%	98.56	%

"Our team has been focused on improving core operating results over the past several quarters, and this quarter has begun to show the results of those efforts. Net interest margin expanded for another consecutive quarter and is above 3% on a tax-equivalent basis. Importantly, we have moved Tier 1 capital up above key internal targets, and asset quality has remained relatively stable. Net recoveries were a strong point, and supported overall profitability and credit quality. Seasonal and timing factors impacted operating expense and non-interest income, and we see continued opportunity in both areas as the year moves forward," said Benjamin Bochnowski, CEO.

Highlights of the current period include:

Net Interest Margin - The net interest margin for the quarter ended June 30, 2025 was 2.97% compared to 2.81% for the quarter ended March 31, 2025. Net interest margin on a tax-equivalent basis (a non-GAAP measure) for the quarter ended June 30, 2025 was 3.11%, as compared to 2.95% for the quarter ended March 31, 2025. The increased net interest margin from the prior quarter is primarily the result of increased loan yields from repricing, as well as improved funding costs and mix.

Funding - As of June 30, 2025, deposits totaled $1.8 billion, an increase of $4.5 million, or 0.3% compared with March 31, 2025 balances, which also totaled $1.8 billion. As of June 30, 2025, non-interest-bearing deposits totaled $271.2 million, a decrease of $10.3 million. Core deposits totaled $1.2 billion at June 30, 2025 and March 31, 2025. Core deposits include checking, savings, and money market accounts and represented 69.1% of the Bancorp's total deposits at June 30, 2025. As of June 30, 2025, balances for certificates of deposit totaled $542.7 million, compared to $544.8 million on March 31, 2025, a decrease of $2.1 million or 0.4%. The increase in total portfolio deposits is primarily related to cyclical flows and continued adjustments to deposit pricing. In addition, as of June 30, 2025, borrowings and repurchase agreements totaled $113.3 million, an increase of $11.6 million or 11.4%, compared to March 31, 2025. The increase in short-term borrowings was the result of cyclical inflows and outflows of interest-earning assets and interest-bearing liabilities.

As of June 30, 2025, 71.7% of our deposits are fully FDIC insured, and another 8.0% are further backed by the Indiana Public Deposit Insurance Fund. The Bancorp's liquidity position remains strong with solid core deposit customer relationships, excess cash, debt securities, contractual loan repayments, and access to diversified borrowing sources. As of June 30, 2025, the Bancorp had available liquidity of $728 million including borrowing capacity from the FHLB and Federal Reserve facilities.

Securities Portfolio - Securities available for sale balances decreased by $2.3 million to $327.8 million as of June 30, 2025, compared to $330.1 million as of March 31, 2025. The decrease in securities available for sale was primarily due to payoffs of collateralized mortgage obligations and residential mortgage-backed securities within the portfolio. The yield on the securities portfolio increased to 2.42% for the three months ended June 30, 2025 from 2.38% for the three months ended March 31, 2025. Management did not execute any securities sale transactions during the quarter.

Lending - The Bank's aggregate loan portfolio totaled $1.5 billion on both June 30, 2025 and March 31, 2025. During the three months ended June 30, 2025, the Bank originated $46.1 million in new commercial loans, compared to $36.7 million during the three months ended March 31, 2025. At June 30, 2025, the Bancorp's portfolio loan balances in commercial real estate owner occupied properties totaled $251.0 million or 16.9% of total loan balances and commercial real estate non-owner occupied properties totaled $299.9 million or 20.1% of total loan balances. Of the $299.9 million in commercial real estate non-owner occupied properties balances, loans collateralized by office buildings represented $42.1 million or 2.8% of total loan balances.

Asset Quality - At June 30, 2025, non-performing loans totaled $13.5 million, compared to $12.5 million at March 31, 2025, an increase of $1.0 million or 8.4%. The Bank's ratio of non-performing loans to total loans was 0.91% at June 30, 2025, compared to 0.84% at March 31, 2025. The Bank's ratio of non-performing assets to total assets increased to 0.74% at June 30, 2025 from 0.69% at March 31, 2025. Management maintains a vigilant oversight of nonperforming loans through proactive relationship management.

The allowance for credit losses (ACL) on loans totaled $18.2 million at June 30, 2025, or 1.22% of total loans receivable, compared to $17.9 million at March 31, 2025, or 1.20% of total loans receivable, an increase of $229 thousand or 1.3%. The Bank's unused commitment reserve, included in other liabilities, totaled $2.0 million at June 30, 2025, compared to $2.1 million at March 31, 2025, a decrease of $89 thousand or 4.2%.

For the quarter ended June 30, 2025, the Bank recorded a net benefit from credit loss totaling $274 thousand based on net loan recoveries, reduction of certain loan and unfunded commitment segment balances, and other factors within the Bank's ACL modeling. The second quarter's benefit consisted of a $185 thousand reversal for credit losses on loans, and a $89 thousand reversal of credit losses on unused commitments. For the quarter ended June 30, 2025, net loan recoveries totaled $414 thousand, compared to net charge-offs of $33 thousand for the quarter ended March 31, 2025. The allowance for credit losses as a percentage of non-performing loans, or coverage ratio, was 133.0% at June 30, 2025, compared to 143.8% at March 31, 2025.

Operating Expenses - Non-interest expense as a percentage of average assets was 2.90% for the quarter ended June 30, 2025, as compared to 2.81% for the quarter ended March 31, 2025. The increase in non-interest expenses quarter over quarter was primarily attributable to higher data processing expenses and higher marketing expenses. The Bank remains focused on identifying additional operating efficiencies and third-party expense reductions.

Capital Adequacy - As of June 30, 2025, the Bank's tier 1 leverage ratio was 8.69%, an improvement of 0.21% compared to 8.48% at March 31, 2025. The Bank's capital continues to exceed all applicable regulatory capital requirements as set forth in 12 C.F.R. § 324. The Bancorp's tangible book value per share (non-GAAP) was $30.16 at June 30, 2025, up from $29.55 as of March 31, 2025. Tangible common equity to total assets (non-GAAP) was 6.32% at June 30, 2025, up from 6.26% as of March 31, 2025. Excluding accumulated other comprehensive losses, tangible book value per share (non-GAAP) increased to $43.47 as of June 30, 2025, from $43.02 as of March 31, 2025.

Disclosures Regarding Non-GAAP Financial Measures

Reported amounts are presented in accordance with GAAP. In this press release, the Bancorp also provides certain financial measures identified as non-GAAP. The Bancorp's management believes that the non-GAAP information, which consists of tangible common equity, tangible common equity adjusted for accumulated other comprehensive losses, tangible book value per share, tangible book value per share adjusted for accumulated other comprehensive losses, tangible common equity/total assets, tangible common equity adjusted for other comprehensive loss/total assets, net interest margin on a tax-equivalent basis, and efficiency ratio which can vary from period to period, provides a better comparison of period to period operating performance. The net interest income and net interest margin on a tax-equivalent basis measures recognize the income tax savings when comparing taxable and tax-exempt assets. Interest income and yields on tax-exempt securities and loans are presented using the current federal corporate income tax rate of 21%. Management believes that it is standard practice in the banking industry to present net interest income and net interest margin on a fully tax-equivalent basis and that it may enhance comparability for peer comparison purposes. Additionally, the Bancorp believes this 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 in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Refer to the "Reconciliation of non-GAAP Financial Measures" below for more information.

About Finward Bancorp

Finward Bancorp is a locally managed and independent financial holding company headquartered in Munster, Indiana, whose activities are primarily limited to holding the stock of Peoples Bank. Peoples Bank provides a wide range of personal, business, electronic and wealth management financial services from its 26 locations in Lake and Porter Counties in Northwest Indiana and Chicagoland. Finward Bancorp's common stock is quoted on The NASDAQ Stock Market, LLC under the symbol FNWD. The website ibankpeoples.com provides information on Peoples Bank's products and services, and Finward Bancorp's investor relations.

Forward Looking Statements

This press release may contain forward-looking statements regarding the financial performance, business prospects, growth and operating strategies of the Bancorp. For these statements, the Bancorp claims the protections of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Statements in this communication should be considered in conjunction with the other information available about the Bancorp, including the information in the filings the Bancorp makes with the SEC. 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. Forward-looking statements are typically identified 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: changes in domestic and international trade policies, including tariffs and other non-tariff barriers, and the effects of such changes on the Bank and its customers; risks related to the development and use of artificial intelligence (AI); the Bank's ability to demonstrate compliance with the terms of the previously disclosed consent order and memorandum of understanding entered into between the Bank and the Federal Deposit Insurance Corporation ("FDIC") and Indiana Department of Financial Institutions ("DFI"), or to demonstrate compliance to the satisfaction of the FDIC and/or DFI within prescribed time frames; the Bank's agreement under the memorandum of understanding to refrain from paying cash dividends without prior regulatory approval; changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates, market liquidity, and capital markets, as well as the magnitude of such changes, which may reduce net interest margins; inflation; further deterioration in the market value of securities held in the Bancorp's investment securities portfolio, whether as a result of macroeconomic factors or otherwise; customer acceptance of the Bancorp's products and services; customer borrowing, repayment, investment, and deposit practices; customer disintermediation; the introduction, withdrawal, success, and timing of business initiatives; competitive conditions; the inability to realize cost savings or revenues or to implement integration plans and other consequences associated with mergers, acquisitions, and divestitures; economic conditions; and the impact, extent, and timing of technological changes, capital management activities, regulatory actions by the Federal Deposit Insurance Corporation and Indiana Department of Financial Institutions, and other actions of the Federal Reserve Board and legislative and regulatory actions and reforms. Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in the Bancorp's reports (such as the Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K) filed with the SEC and available at the SEC's Internet website (www.sec.gov). All subsequent written and oral forward-looking statements concerning matters attributable to the Bancorp or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above. Except as required by law, The Bancorp does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statement is made.

In addition to the above factors, we also caution that the actual amounts and timing of any future common stock dividends or share repurchases will be subject to various factors, including our capital position, financial performance, capital impacts of strategic initiatives, market conditions, and regulatory and accounting considerations, as well as any other factors that our Board of Directors deems relevant in making such a determination. Therefore, there can be no assurance that we will repurchase shares or pay any dividends to holders of our common stock, or as to the amount of any such repurchases or dividends.

Performance Ratios
	Quarter Ended															Six Months Ended
	6/30/2025			3/31/2025			12/31/2024			9/30/2024			6/30/2024			6/30/2025			6/30/2024
Return on equity		5.66	%		1.17	%		5.39	%		1.60	%		0.39	%		3.39	%		12.81	%
Return on assets		0.42	%		0.09	%		0.41	%		0.12	%		0.03	%		0.25	%		0.91	%
Yield on loans		5.36	%		5.25	%		5.27	%		5.22	%		5.11	%		5.31	%		5.06	%
Yield on security investments		2.42	%		2.38	%		2.34	%		2.37	%		2.43	%		2.40	%		2.40	%
Total yield on earning assets		4.82	%		4.71	%		4.74	%		4.70	%		4.64	%		4.77	%		4.58	%
Cost of interest-bearing deposits		2.12	%		2.17	%		2.41	%		2.47	%		2.37	%		2.14	%		2.37	%
Cost of repurchase agreements		3.32	%		3.35	%		3.65	%		4.04	%		3.86	%		3.34	%		3.87	%
Cost of borrowed funds		3.91	%		4.12	%		4.31	%		4.56	%		4.95	%		4.01	%		4.69	%
Total cost of interest-bearing liabilities		2.22	%		2.28	%		2.53	%		2.63	%		2.55	%		2.25	%		2.53	%
Net interest margin		2.97	%		2.81	%		2.65	%		2.53	%		2.53	%		2.89	%		2.47	%
Net interest margin, tax-equivalent (non-GAAP)⁽¹⁾		3.11	%		2.95	%		2.79	%		2.66	%		2.67	%		3.03	%		2.62	%
Non-interest income/average assets		0.53	%		0.43	%		0.72	%		0.55	%		0.50	%		0.48	%		1.54	%
Non-interest expense/average assets		2.90	%		2.81	%		2.75	%		2.80	%		2.79	%		2.86	%		2.83	%
Efficiency ratio (non-GAAP)⁽¹⁾		88.92	%		93.11	%		87.20	%		97.32	%		98.56	%		90.95	%		73.77	%

Non-performing assets to total assets		0.74	%		0.69	%		0.74	%		0.73	%		0.61	%		0.74	%		0.61	%
Non-performing loans to total loans		0.91	%		0.84	%		0.91	%		0.92	%		0.75	%		0.91	%		0.75	%
Allowance for credit losses to non-performing loans		133.01	%		143.84	%		123.10	%		134.12	%		161.17	%		133.01	%		161.17	%
Allowance for credit losses to loans receivable		1.22	%		1.20	%		1.12	%		1.23	%		1.22	%		1.22	%		1.22	%
Net charge-offs (recoveries) as a percentage of average loans receivable		(0.11	%)		0.01	%		0.59	%		0.05	%		0.01	%		(0.05	%)		0.01	%

Basic earnings per share	$	0.50		$	0.11		$	0.49		$	0.14		$	0.03		$	0.61		$	2.21
Diluted earnings per share	$	0.50		$	0.11		$	0.49		$	0.14		$	0.03		$	0.61		$	2.21
Weighted average common shares outstanding—basic		4,271,952			4,266,976			4,261,079			4,260,809			4,259,695			4,269,478			4,258,181
Weighted average common shares outstanding—diluted		4,291,319			4,284,496			4,286,742			4,281,148			4,271,052			4,287,877			4,266,415

Stockholders' equity/total assets		7.48	%		7.44	%		7.35	%		7.69	%		7.16	%		7.48	%		7.16	%
Tangible common equity to total assets (non-GAAP) ⁽¹⁾		6.32	%		6.26	%		6.17	%		6.51	%		5.95	%		6.32	%		5.95	%
Tangible common equity adjusted for accumulated other comprehensive loss to total assets (non-GAAP) ⁽¹⁾		9.11	%		9.12	%		8.99	%		8.83	%		8.79	%		9.11	%		8.79	%
Book value per share	$	35.67		$	35.10		$	35.10		$	36.99		$	34.45		$	35.67		$	34.45
Tangible common book value per share (non-GAAP) ⁽¹⁾	$	30.16		$	29.55		$	29.48		$	31.28		$	28.67		$	30.16		$	28.67
Tangible common book value per share adjusted for accumulated other comprehensive loss (non-GAAP) ⁽¹⁾	$	43.47		$	43.02		$	42.94		$	42.47		$	42.33		$	43.47		$	42.33
Closing stock price	$	27.62		$	29.10		$	28.11		$	31.98		$	24.52		$	27.62		$	24.52
Dividends declared per common share	$	0.12		$	—		$	0.12		$	0.12		$	0.12		$	0.12		$	0.24

(1)	See the reconciliation of these non-GAAP measures to the most directly comparable GAAP measures on pg 13.

Average Balances, Interest, Rates
	Quarter Ended
	June 30, 2025							March 31, 2025							December 31, 2024
	Average Balance			Interest		Yield/Rate		Average Balance			Interest		Yield/Rate		Average Balance			Interest		Yield/Rate
ASSETS
Interest bearing deposits in other financial institutions	$	57,749		$	614	4.25	%	$	53,553		$	540	4.03	%	$	50,271		$	650	5.17	%
Federal funds sold		868			8	3.69	%		1,375			12	3.49	%		891			9	4.04	%
Securities available-for-sale		327,867			1,980	2.42	%		336,060			1,998	2.38	%		343,411			2,011	2.34	%
Loans receivable		1,486,861			19,940	5.36	%		1,498,312			19,655	5.25	%		1,504,233			19,802	5.27	%
Federal Home Loan Bank stock		6,547			128	7.82	%		6,547			136	8.31	%		6,547			123	7.51	%
Total interest earning assets		1,879,892		$	22,670	4.82	%		1,895,847		$	22,341	4.71	%		1,905,353		$	22,595	4.74	%
Cash and non-interest bearing deposits in other financial institutions		27,192							27,919							27,360
Allowance for credit losses		(18,028	)						(16,946	)						(18,110	)
Other non-interest bearing assets		152,880							153,148							154,707
Total assets	$	2,041,936						$	2,059,968						$	2,069,310

LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing deposits	$	1,470,225		$	7,780	2.12	%	$	1,481,377		$	8,044	2.17	%	$	1,465,198		$	8,811	2.41	%
Repurchase agreements		44,401			368	3.32	%		41,631			349	3.35	%		43,372			396	3.65	%
Borrowed funds		58,995			577	3.91	%		61,613			635	4.12	%		72,536			781	4.31	%
Total interest bearing liabilities		1,573,621		$	8,725	2.22	%		1,584,621		$	9,028	2.28	%		1,581,106		$	9,988	2.53	%
Non-interest bearing deposits		278,620							279,013							289,467
Other non-interest bearing liabilities		37,703							40,923							42,944
Total liabilities		1,889,944							1,904,557							1,913,517
Total stockholders' equity		151,992							155,411							155,793
Total liabilities and stockholders' equity	$	2,041,936						$	2,059,968						$	2,069,310

Net interest income				$	13,945						$	13,313						$	12,607
Return on average assets		0.42	%						0.09	%						0.41	%
Return on average equity		5.66	%						1.17	%						5.39	%
Net interest margin		2.97	%						2.81	%						2.65	%
Net interest margin, tax-equivalent (non-GAAP)⁽¹⁾		3.11	%						2.95	%						2.79	%
Net interest spread		2.62	%						2.43	%						2.21	%
Ratio of interest-earning assets to interest-bearing liabilities	1.19x							1.20x							1.21x

(1)	See the reconciliation of non-GAAP measures to the most directly comparable GAAP measures on pg 13.

Consolidated Balance Sheets
	As of
(Dollars in thousands)	6/30/2025			3/31/2025			12/31/2024			9/30/2024			6/30/2024
ASSETS
Cash and non-interest bearing deposits in other financial institutions	$	23,027		$	18,563		$	17,883		$	23,071		$	19,061
Interest bearing deposits in other financial institutions		79,976			52,829			52,047			48,025			63,439
Federal funds sold		411			975			654			553			707
Total cash and cash equivalents		103,414			72,367			70,584			71,649			83,207
Securities available-for-sale		327,845			330,127			333,554			350,027			339,585
Loans held-for-sale		834			2,849			1,253			2,567			1,185
Loans receivable, net of deferred fees and costs		1,489,486			1,491,696			1,508,976			1,508,242			1,506,398
Less: allowance for credit losses		(18,184	)		(17,955	)		(16,911	)		(18,516	)		(18,330	)
Net loans receivable		1,471,302			1,473,741			1,492,065			1,489,726			1,488,068
Federal Home Loan Bank stock		6,547			6,547			6,547			6,547			6,547
Accrued interest receivable		7,651			7,821			7,721			7,442			7,695
Premises and equipment		46,179			46,680			47,259			47,912			48,696
Cash value of bank owned life insurance		33,932			33,712			33,514			33,312			33,107
Goodwill		22,395			22,395			22,395			22,395			22,395
Other intangible assets		1,414			1,635			1,860			2,203			2,555
Other assets		41,470			41,840			43,947			40,882			44,027
Total assets	$	2,062,983		$	2,039,714		$	2,060,699		$	2,074,662		$	2,077,067
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing	$	271,172		$	281,461		$	263,324		$	285,157		$	286,784
Interest bearing		1,483,678			1,468,923			1,497,242			1,463,653			1,469,970
Total		1,754,850			1,750,384			1,760,566			1,748,810			1,756,754
Repurchase agreements		48,331			45,053			40,116			43,038			42,973
Borrowed funds		65,000			56,657			65,000			85,000			85,000
Accrued expenses and other liabilities		40,549			35,813			43,603			38,259			43,709
Total liabilities		1,908,730			1,887,907			1,909,285			1,915,107			1,928,436
Stockholders' Equity:
Preferred stock, no par or stated value; 10,000,000 shares authorized, none outstanding		-			-			-			-			-
Common stock, no par or stated value; 10,000,000 shares authorized⁽¹⁾		-			-			-			-			-
Additional paid-in capital		70,263			70,132			70,034			69,916			69,778
Accumulated other comprehensive loss		(57,560	)		(58,244	)		(58,084	)		(48,241	)		(58,939	)
Retained earnings		141,550			139,919			139,464			137,880			137,792
Total stockholders' equity		154,253			151,807			151,414			159,555			148,631
Total liabilities and stockholders' equity	$	2,062,983		$	2,039,714		$	2,060,699		$	2,074,662		$	2,077,067

(1)	Shares of common stock issued and outstanding were at 4,324,889 at 6/30/2025; 4,324,485 at 3/31/2025; 4,313,698 at 12/31/24; 4,313,940 at 9/30/24; and 4,313,940 at 6/30/24.

Consolidated Statements of Income
	Quarter Ended
(Dollars in thousands, except per share data)	6/30/2025			3/31/2025		12/31/2024			9/30/2024			6/30/2024
Interest income:
Loans	$	19,940		$	19,655	$	19,802		$	19,660		$	19,174
Securities & short-term investments		2,730			2,686		2,793			2,812			2,953
Total interest income		22,670			22,341		22,595			22,472			22,127
Interest expense:
Deposits		7,780			8,045		8,812			8,946			8,610
Borrowings		945			983		1,176			1,520			1,463
Total interest expense		8,725			9,028		9,988			10,466			10,073
Net interest income		13,945			13,313		12,607			12,006			12,054
Provision for (benefit from) credit losses		(274	)		454		(579	)		-			76
Net interest income after provision for credit losses		14,219			12,859		13,186			12,006			11,978
Non-interest income:
Fees and service charges		1,330			1,109		1,439			1,463			1,257
Wealth management operations		696			619		728			731			763
Gain on tax credit investment		-			67		1,236			-			-
Gain on sale of loans held-for-sale, net		378			230		328			338			320
Increase in cash value of bank owned life insurance		220			198		202			205			212
Gain (loss) on sale of real estate		-			-		(212	)		-			15
Other		59			6		11			130			6
Total non-interest income		2,683			2,229		3,732			2,867			2,573
Non-interest expense:
Compensation and benefits		7,313			7,372		6,628			6,963			7,037
Occupancy and equipment		1,935			2,111		2,045			2,181			2,116
Data processing		1,341			1,039		1,202			1,165			1,135
Federal deposit insurance premiums		471			433		457			435			397
Marketing		214			86		220			209			212
Professional and outside services		1,115			1,260		1,341			1,251			1,257
Technology		545			454		509			602			507
Other		1,852			1,717		1,845			1,668			1,756
Total non-interest expense		14,786			14,472		14,247			14,474			14,417
Income before income taxes		2,116			616		2,671			399			134
Income tax expenses (benefit)		(35	)		161		569			(207	)		(9	)
Net income	$	2,151		$	455	$	2,102		$	606		$	143

Earnings per common share:
Basic	$	0.50		$	0.11	$	0.49		$	0.14		$	0.03
Diluted	$	0.50		$	0.11	$	0.49		$	0.14		$	0.03

Consolidated Statements of Income (cont'd)
	Six Months Ended
(Dollars in thousands, except per share data)	6/30/2025		6/30/2024
Interest income:
Loans	$	39,595	$	38,053
Securities & short-term investments		5,416		6,058
Total interest income		45,011		44,111
Interest expense:
Deposits		15,825		17,404
Borrowings		1,928		2,873
Total interest expense		17,753		20,277
Net interest income		27,258		23,834
Provision for credit losses		180		76
Net interest income after provision for credit losses		27,078		23,758
Non-interest income:
Fees and service charges		2,439		2,410
Wealth management operations		1,315		1,396
Gain on tax credit investment		67		-
Gain on sale of loans held-for-sale, net		608		472
Increase in cash value of bank owned life insurance		418		405
Gain on sale of real estate		-		11,873
Loss on sale of securities, net		-		(531	)
Other		65		24
Total non-interest income		4,912		16,049
Non-interest expense:
Compensation and benefits		14,685		14,146
Occupancy and equipment		4,046		4,024
Data processing		2,380		2,305
Federal deposit insurance premiums		904		898
Marketing		300		370
Professional and outside services		2,375		2,814
Technology		999		1,132
Other		3,569		3,732
Total non-interest expense		29,258		29,421
Income before income taxes		2,732		10,386
Income tax expenses		126		963
Net income	$	2,606	$	9,423

Earnings per common share:
Basic	$	0.61	$	2.21
Diluted	$	0.61	$	2.21

Loans
	As of
(Dollars in thousands)	6/30/2025			3/31/2025			12/31/2024			9/30/2024		6/30/2024			6/30/2025 vs 3/31/2025					6/30/2025 vs 6/30/2024
Residential real estate	$	456,256		$	458,424		$	467,293		$	471,156	$	475,371		$	(2,168	)	(0.5	)%	$	(19,115	)	(4.0	)%
Home equity		51,112			49,752			49,758			49,106		48,435			1,360		2.7	%		2,677		5.5	%
Commercial real estate		551,091			554,866			551,674			539,972		529,421			(3,775	)	(0.7	)%		21,670		4.1	%
Construction and land development		74,895			86,728			82,874			87,923		88,699			(11,833	)	(13.6	)%		(13,804	)	(15.6	)%
Multifamily		206,540			204,964			212,455			218,037		219,841			1,576		0.8	%		(13,301	)	(6.1	)%
Commercial business		105,636			99,519			104,246			97,900		98,402			6,117		6.1	%		7,234		7.4	%
Consumer		2,347			504			551			522		611			1,843		365.7	%		1,736		284.1	%
Manufactured homes		25,146			25,762			26,708			27,462		28,721			(616	)	(2.4	)%		(3,575	)	(12.4	)%
Government		14,628			9,279			11,024			12,969		14,014			5,349		57.6	%		614		4.4	%
Loans receivable		1,487,651			1,489,798			1,506,583			1,505,047		1,503,515			(2,147	)	(0.1	)%		(15,864	)	(1.1	)%
Net deferred loan origination costs		2,012			2,209			2,439			2,606		3,054			(197	)	(8.9	)%		(1,042	)	(34.1	)%
Loan clearing funds		(177	)		(311	)		(46	)		589		(171	)		134		(43.1	)%		(6	)	3.5	%
Loans receivable, net	$	1,489,486		$	1,491,696		$	1,508,976		$	1,508,242	$	1,506,398		$	(2,210	)	(0.1	)%	$	(16,912	)	(1.1	)%

Deposits
	As of
(Dollars in thousands)	6/30/2025		3/31/2025		12/31/2024		9/30/2024		6/30/2024		6/30/2025 vs 3/31/2025					6/30/2025 vs 6/30/2024
Checking	$	593,471	$	589,403	$	591,487	$	579,132	$	603,730	$	4,068		0.7	%	$	(10,259	)	(1.7	)%
Savings		266,070		274,028		275,121		279,126		288,920		(7,958	)	(2.9	)%		(22,850	)	(7.9	)%
Money market		352,616		342,106		333,705		328,329		322,939		10,510		3.1	%		29,677		9.2	%
Certificates of deposit		542,693		544,847		560,253		562,223		541,165		(2,154	)	(0.4	)%		1,528		0.3	%
Total deposits	$	1,754,850	$	1,750,384	$	1,760,566	$	1,748,810	$	1,756,754	$	4,466		0.3	%	$	(1,904	)	(0.1	)%

Asset Quality
	As of and for the Quarter Ended
(Dollars in thousands)	6/30/2025		3/31/2025		12/31/2024		9/30/2024		6/30/2024
Non-accruing loans	$	13,526	$	12,483	$	13,738	$	13,806	$	11,079
Accruing loans delinquent more than 90 days		145		-		-		-		294
Securities in non-accrual		1,616		1,630		1,419		1,440		1,371
Total nonperforming assets	$	15,287	$	14,113	$	15,157	$	15,246	$	12,744

Allowance for credit losses (ACL):
ACL specific allowances for collateral dependent loans	$	570	$	259	$	284	$	1,821	$	1,327
ACL general allowances for loan portfolio		17,614		17,696		16,627		16,695		17,003
Total ACL	$	18,184	$	17,955	$	16,911	$	18,516	$	18,330

Allowance for Credit Losses

	As of and for the Quarter Ended
(Dollars in thousands)	6/30/2025			3/31/2025			12/31/2024			9/30/2024			6/30/2024
Beginning allowance for credit losses	$	17,955		$	16,911		$	18,516		$	18,330		$	18,805
Provision for (benefit from) loan losses		(185	)		1,077			597			372			(439	)
Net (charge-offs) recoveries		414			(33	)		(2,202	)		(186	)		(36	)
Ending allowance for credit losses	$	18,184		$	17,955		$	16,911		$	18,516		$	18,330

Bank-Level Regulatory Capital Requirements
	June 30, 2025
	Actual⁽¹⁾				Minimum Required For Capital Adequacy Purposes					Minimum Required To Be Well Capitalized Under Prompt Corrective Action Regulations
(Dollars in thousands)	Amount		Ratio		Amount		Ratio			Amount		Ratio
Common equity tier 1 capital to risk-weighted assets	$	181,430	11.26	%	$	72,478		4.50	%	$	104,691	6.50	%
Tier 1 capital to risk-weighted assets	$	181,430	11.26	%	$	96,638		6.00	%	$	128,850	8.00	%
Total capital to risk-weighted assets	$	201,640	12.52	%	$	128,850		8.00	%	$	161,063	10.00	%
Tier 1 leverage ratio	$	181,430	8.69	%	$	83,550		4.00	%	$	104,437	5.00	%

(1)	Current quarter ratios are estimated.

Reconciliation of Non-GAAP Performance Measures
	Quarter Ended
(Dollars in thousands, except per share amounts)	6/30/2025			3/31/2025			12/31/2024			9/30/2024			6/30/2024
Tangible Common Ratios
Stockholder's equity (GAAP)	$	154,253		$	151,807		$	151,414		$	159,555		$	148,631
Less: Goodwill (GAAP)		(22,395	)		(22,395	)		(22,395	)		(22,395	)		(22,395	)
Less: Other intangibles (GAAP)		(1,414	)		(1,635	)		(1,860	)		(2,203	)		(2,555	)
Tangible common equity (non-GAAP)	$	130,444		$	127,777		$	127,159		$	134,957		$	123,681
Add: Accumulated other comprehensive loss (GAAP)		57,560			58,244			58,084			48,241			58,939
Tangible common equity adjusted for accumulated other comprehensive loss (non-GAAP) ⁽¹⁾	$	188,004

Finward Bancorp Announces Second Quarter 2025 Results