First Business Financial Services, Inc. (FBFS) reported a solid financial performance for the fiscal year ending December 31, 2025, with net income available to common shareholders reaching $49.4 million, a 14.8% increase from $43.4 million in 2024. Diluted earnings per share also rose to $5.94, up from $5.20 in the previous year. The company’s total assets grew by 5.9% to $4.082 billion, driven by an increase in gross loans and leases, which rose by 8.4% to $3.375 billion. The return on average assets (ROAA) improved slightly to 1.24%, while the return on average tangible common equity (ROATCE) was reported at 15.25%, a marginal decrease from 15.35% in 2024.
The year saw a notable increase in total deposits, which rose by 8.8% to $3.380 billion, reflecting successful business development efforts. Core deposits, a key funding source, increased by 11.5% to $2.673 billion, representing 74.7% of total bank funding. The efficiency ratio improved to 58.78%, down from 60.61% in 2024, indicating better operational efficiency. However, non-performing assets increased to $43.9 million, or 1.07% of total assets, compared to $28.4 million, or 0.74%, in the prior year, primarily due to a downgrade in a single client relationship.
Strategically, FBFS has focused on enhancing its product offerings and expanding its market presence. The company has made significant investments in technology to improve operational efficiency and client service. Additionally, the firm has maintained a strong commitment to its workforce, with an employee headcount of 371 as of December 31, 2025, reflecting a focus on attracting specialized talent. The company has also been recognized as a Top Workplace for the fifth consecutive year, underscoring its commitment to employee engagement and satisfaction.
Looking ahead, FBFS aims to continue its growth trajectory by leveraging its core strengths in commercial banking and private wealth management. The company has outlined a five-year strategic plan that emphasizes innovation, operational excellence, and the development of future-ready talent. Management remains optimistic about the potential for sustainable profitability and growth, despite the challenges posed by market conditions and regulatory scrutiny. The firm’s capital ratios remain strong, with the Bank classified as well-capitalized under regulatory standards, positioning it well for future opportunities.
About FIRST BUSINESS FINANCIAL SERVICES, INC.
First Business Financial Services, Inc. is a bank holding company operating through its subsidiary, First Business Bank, which provides commercial banking, private wealth management, and bank consulting services. It focuses on small- to medium-sized businesses in Wisconsin, Kansas, and Missouri, offering loans, real estate financing, asset-based lending, SBA programs, treasury services, and wealth management. The company emphasizes long-term client relationships, financial expertise, and a strong regulatory and capital position.
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