SBFG SB Finanical Group Inc

SB Financial Group, Inc. (NASDAQ: SBFG) (“SB Financial” or the “Company”), a diversified financial services company providing full-service community banking, mortgage banking, wealth management, private client and title insurance services today reported earnings for the third quarter ended September 30, 2024.

Third Quarter 2024 Highlights compared to the third quarter of the prior year:

• Net income of $2.4 million, down 12.4 percent with Diluted Earnings Per Share (“EPS”) of $0.35. EPS is up 3.0% when adjusted for mortgage servicing rights impairment in both periods.
• Net interest income totaled $10.2 million, a 6.8 percent increase from $9.5 million.
• Total loans increased to $1.03 billion, up by $40.9 million or 4.1 percent.
• Tangible book value per share ended the quarter at $16.49, up $3.40 per share or 26.0%.

Nine Months Ended September 30, 2024, highlights over prior-year nine months include:

• Mortgage Banking Revenue increased to $4.7 million, up by 7.6 percent from $4.4 million.
• Noninterest income increased 2.2% to $12.5 million, up from $12.2 million.
• Noninterest expense increased 1.1% to $32.0 million, up from $31.6 million.

Trailing Twelve Months Ended September 30, 2024, highlights compared to the prior year:

• Diluted EPS was $1.74 for the twelve months ended September 2024, reflecting a 3.6% increase from the prior twelve months of $1.68.
• Total deposits reached $1.16 billion by the end of September 2024, marking a 6.8% growth from $1.09 billion at the same time in 2023.
• Mortgage origination volume was $228.3 million for the trailing twelve months, while the servicing portfolio increased by 2.9% to $1.41 billion.

Earnings Highlights	Three Months Ended									Nine Months Ended
($ in thousands, except per share & ratios)	Sep. 2024			Sep. 2023			% Change			Sep. 2024			Sep. 2023			% Change
Operating revenue	$	14,309		$	13,699		4.5	%		$	41,485		$	41,879		-0.9	%
Interest income		16,548			14,796		11.8	%			47,502			43,026		10.4	%
Interest expense		6,362			5,260		21.0	%			18,477			13,337		38.5	%
Net interest income		10,186			9,536		6.8	%			29,025			29,689		-2.2	%
Provision (recovery) for credit losses		200			(6	)	3433.3	%			200			389		-48.6	%
Noninterest income		4,123			4,163		-1.0	%			12,460			12,190		2.2	%
Noninterest expense		11,003			10,481		5.0	%			31,956			31,593		1.1	%
Net income		2,354			2,687		-12.4	%			7,835			8,212		-4.6	%
Earnings per diluted share		0.35			0.39		-10.3	%			1.17			1.18		-0.8	%
Return on average assets		0.68	%		0.80	%	-15.0	%			0.77	%		0.81	%	-4.9	%
Return on average equity		7.32	%		8.73	%	-16.2	%			8.41	%		8.72	%	-3.6	%

"We delivered strong operational performance during the September quarter with our pretax preprovision earnings up over 14% when we adjust for the servicing rights impairment," stated Mark A. Klein, Chairman, President, and CEO. "We are on track with our Marblehead acquisition and are especially pleased that we have increased the tangible book value per share by 26% in the last year."

"Our Loan Book expanded to $1.03 billion, an increase of $40.9 million, underscoring our disciplined approach to portfolio expansion. Despite market pressures from interest rates, our deposits increased by $74.2 million or 6.8% year-over-year reaching $1.16 billion," added Mr. Klein.

RESULTS OF OPERATIONS

Consolidated Revenue

In the third quarter of 2024, core earnings and margins rose with operating revenue rising to $14.3 million, a 4.5% increase from the $13.7 million in the prior year. While net interest income rose to $10.2 million, a 6.8% increase year-over-year, the Company faced pressure from rising deposit costs, which drove a 21% increase in interest expenses. Despite this, net interest margin saw a slight expansion, increasing by 9 basis points compared to the same period last year, reaching 3.17%.

Noninterest income was down 1.0%, however, when adjusted for the servicing rights impairment and the gain on sale of assets, it was up nearly 4%. Mortgage gain on sale had its best quarter since the first quarter of 2022 and we saw solid increases in Title insurance revenue (up 13%) and Wealth management revenue (up 5%).

Mortgage Loan Business

In the third quarter of 2024, SB Financial Group recorded a 15.5% year-over-year increase in mortgage loan originations, reaching $70.7 million, up from $61.2 million in the corresponding period last year. This strong performance reflects our ability to capitalize on favorable market conditions and underscores the resilience of the housing sector, which continues to show signs of strength despite broader economic challenges. Mortgage sales followed this growth, reaching $61.3 million, or 86.6% of total originations. This represents a 13.3% year-over-year increase from $54.1 million, signaling our ongoing success in expanding our market reach and maintaining a competitive position. The sales volume highlights the robustness of our operations, even as competition intensifies in the residential lending space.

However, mortgage banking net revenue decreased to $1.35 million, down 17.9% from $1.65 million in the prior year. This decline was primarily driven by a negative Originated Mortgage Servicing Rights (“OMSR”) valuation adjustment of $465 thousand this quarter, significantly impacting net loan servicing fees. This reflects broader market headwinds, including shifts in borrower behavior and refinancing rates, which put pressure on servicing valuations. Despite this, gains from the sale of mortgages and continued efficiency in our operations helped partially offset the decline. The mortgage servicing portfolio expanded by 2.9%, reaching $1.41 billion. This steady growth in our servicing portfolio is a testament to our commitment to building long-term, sustainable relationships.

Mr. Klein stated, "This quarter has showcased improved efficiency in our mortgage operations. Although our results slightly missed our internal targets, the shortfall primarily reflects the heightened competitiveness and shifting dynamics within the mortgage market. Despite these challenges, our proactive measures, including expanding our origination teams, including closing our first loan from the Cincinnati market, have positioned us to capitalize on market opportunities and maintain our momentum."

Mortgage Banking
($ in thousands)	Sep. 2024			Jun. 2024			Mar. 2024			Dec. 2023			Sep. 2023				Prior Year Growth
Mortgage originations	$	70,715		$	75,110		$	42,912		$	39,566		$	61,200			$	9,515
Mortgage sales		61,271			55,835			36,623			33,362			54,085				7,186
Mortgage servicing portfolio		1,406,273			1,389,805			1,371,713			1,366,667			1,367,209				39,064
Mortgage servicing rights		14,357			14,548			14,191			13,906			13,893				464
Revenue
Loan servicing fees		874			862			855			855			850				24
OMSR amortization		(370	)		(335	)		(273	)		(282	)		(334	)			(36	)
Net administrative fees		504			527			582			573			516				(12	)
OMSR valuation adjustment		(465	)		38			181			(12	)		(78	)			(387	)
Net loan servicing fees		39			565			763			561			438				(399	)
Gain on sale of mortgages		1,311			1,277			781			747			1,207				104
Mortgage banking revenue, net	$	1,350		$	1,842		$	1,544		$	1,308		$	1,645			$	(295	)

Noninterest Income and Noninterest Expense

For the third quarter of 2024, SB Financial Group's noninterest income slightly declined to $4.12 million, representing a 1.0% decrease compared to $4.16 million in the third quarter of 2023. This minor reduction was primarily driven by lower mortgage loan servicing fees, which fell from $438 thousand in the third quarter of 2023 to $39 thousand in the third quarter of 2024, reflecting significant pressure in the mortgage servicing market. Furthermore, other noninterest income also contributed to the decline. However, this was partially offset by an increase in wealth management fees, which rose by 5.4% to $882 thousand, and a gain on the sale of mortgage loans and OMSR, which increased to $1.31 million from $1.21 million in the prior-year quarter. The gain on the sale of assets further contributed positively with $200 thousand realized this quarter.

Noninterest expenses for the third quarter were reported at $11.0 million, reflecting a 5.0% increase compared to $10.5 million in the third quarter of 2023. This rise was primarily driven by the increase of additional talent, which rose by 10.3% to $6.06 million, along with a 17% increase in data processing fees to $758 thousand. While certain expense categories saw reductions, such as other expenses, which decreased to $804 thousand from $1.1 million in the prior year, these declines were not sufficient enough to offset the overall increase in operating expenses.

Noninterest Income/Noninterest Expense
($ in thousands, except ratios)		Sep. 2024			Jun. 2024			Mar. 2024			Dec. 2023			Sep. 2023				Prior Year Growth
Noninterest Income (NII)		$	4,123		$	4,386		$	3,951		$	5,531		$	4,163			$	(40	)
NII / Total Revenue			28.8	%		31.5	%		30.1	%		36.6	%		30.4	%			-1.6	%
NII / Average Assets			1.2	%		1.3	%		1.2	%		1.7	%		1.2	%			0.0	%
Total Revenue Growth			4.5	%		-0.6	%		-6.1	%		3.4	%		-5.3	%			-0.9	%
Noninterest Expense (NIE)		$	11,003		$	10,671		$	10,282		$	10,369		$	10,481			$	522
Efficiency Ratio			76.8	%		75.9	%		78.2	%		68.4	%		79.0	%			-2.2	%
NIE / Average Assets			3.2	%		3.2	%		3.1	%		3.1	%		3.1	%			0.1	%
Net Noninterest Expense/Avg. Assets			-2.0	%		-1.9	%		-1.9	%		-1.4	%		-1.9	%			-0.1	%
Total Expense Growth			5.0	%		3.2	%		-4.6	%		1.0	%		0.9	%			5.0	%

Mr. Klein commented on the financial performance, stating, "Our noninterest income continues to show resilience, supported by gains from mortgage-related activities and consistent wealth management performance. As expected, the competitive environment and market fluctuations impacted servicing fees. On the expense side, our focus remains on managing costs related to growth initiatives, and we are committed to optimizing our cost structure to maintain operational efficiency and deliver sustained value to our stakeholders."

Balance Sheet

As of September 30, 2024, SB Financial Group continued to demonstrate financial stability, with total assets increasing to $1.39 billion, a 5.1% increase from $1.33 billion at the end of the prior-year period. This growth underscores our ability to maintain a robust financial position amidst changing market conditions.

Our loan portfolio remained strong, standing at $1.03 billion, up by $40.9 million or 4.1% compared to the prior year. This growth highlights our effective lending practices and strong demand in the credit market. Additionally, cash and cash equivalents increased significantly to $49.3 million, up 159.1% from $19.0 million a year ago, enhancing our liquidity position and providing us with greater flexibility in navigating economic uncertainties.

Deposits increased to $1.16 billion, reflecting a 6.8% growth compared to the prior-year figure of $1.09 billion, driven by increases across all interest-bearing deposit categories. This growth reflects continued trust from our clients and a solid base to support ongoing operations.

Shareholders’ equity expanded significantly to $132.8 million, a 5.9% increase from the linked quarter and an 18.2% year-over-year rise, underscoring our commitment to driving shareholder value. This improvement can be attributed to retained earnings growth and an improvement in accumulated comprehensive losses. The year-over-year growth in shareholders' equity reflects our focus on strengthening the balance sheet and optimizing capital allocation strategies.

Mr. Klein, commented, "In 2024, we have maintained a disciplined and proactive approach to our growth and capital management, aligning closely with our strategic objectives. Our ability to sustain and grow our loan portfolio, even in a highly competitive market, demonstrates the resilience of our business model and the effectiveness of our relationship-driven lending practices. Furthermore, the year-over-year increase in shareholders' equity highlights our continued commitment to delivering shareholder value. We remain poised to leverage future opportunities that will further fortify our financial position and ensure long-term prosperity for our stakeholders."

Loan Balances
($ in thousands, except ratios)	Sep. 2024			Jun. 2024			Mar. 2024			Dec. 2023			Sep. 2023			Annual Growth
Commercial	$	123,821		$	123,287		$	120,016		$	126,716		$	120,325		$	3,496
% of Total		12.0	%		12.3	%		12.1	%		12.7	%		12.2	%		2.9	%
Commercial RE		459,449			434,967			429,362			424,041			421,736			37,713
% of Total		44.6	%		43.3	%		43.3	%		42.4	%		42.6	%		8.9	%
Agriculture		64,887			64,329			62,365			65,659			60,928			3,959
% of Total		6.3	%		6.4	%		6.3	%		6.6	%		6.2	%		6.5	%
Residential RE		314,010			316,233			314,668			318,123			320,306			(6,296	)
% of Total		30.5	%		31.5	%		31.7	%		31.8	%		32.4	%		-2.0	%
Consumer & Other		67,788			66,574			65,141			65,673			65,726			2,062
% of Total		6.6	%		6.6	%		6.6	%		6.6	%		6.6	%		3.1	%
Total Loans	$	1,029,955		$	1,005,390		$	991,552		$	1,000,212		$	989,021		$	40,934
Total Growth Percentage																	4.1	%
Deposit Balances
($ in thousands, except ratios)	Sep. 2024			Jun. 2024			Mar. 2024			Dec. 2023			Sep. 2023			Annual Growth
Non-Int DDA	$	222,425		$	208,244		$	219,395		$	228,713		$	224,182		$	(1,757	)
% of Total		19.2	%		18.7	%		19.7	%		21.4	%		20.7	%		-0.8	%
Interest DDA		202,097			190,857			169,171			166,413			174,729			27,368
% of Total		17.4	%		17.1	%		15.2	%		15.5	%		16.1	%		15.7	%
Savings		241,761			231,855			244,157			216,965			226,077			15,684
% of Total		20.8	%		20.8	%		21.9	%		20.3	%		20.8	%		6.9	%
Money Market		228,182			225,650			221,362			202,605			216,565			11,617
% of Total		19.7	%		20.2	%		19.9	%		18.9	%		20.0	%		5.4	%
Time Deposits		265,068			258,582			258,257			255,509			243,766			21,302
% of Total		22.9	%		23.2	%		23.2	%		23.9	%		22.5	%		8.7	%
Total Deposits	$	1,159,533		$	1,115,188		$	1,112,342		$	1,070,205		$	1,085,319		$	74,214
Total Growth Percentage																	6.8	%

Asset Quality

SB Financial Group's commitment to maintaining exceptional asset quality remained strong through the third quarter of 2024. As of September 2024, nonperforming loans constituted 0.54% of total loans, an increase from 0.47% in the prior quarter. While the allowance for credit losses coverage stood at 276.8% of nonperforming loans—below the 330% reported in the linked quarter—it remains robust, signaling a conservative approach to risk management.

Additionally, the net loan charge-offs to average loans ratio was a modest 0.01%, further highlighting SB Financial Group’s effective loan repayment management. Collectively, these metrics reinforce our reputation for disciplined risk oversight and credit administration.

Mr. Klein concluded, “Our third quarter performance underscores our continued commitment to maintaining high asset quality. Although we observed a slight increase in nonperforming loans and a decrease in our reserve coverage ratio, our allowance for credit losses remains robust. This, coupled with our disciplined approach to credit risk management, demonstrates our focus on preserving the long-term strength of our loan portfolio and ensuring stability amidst ongoing economic shifts."

Nonperforming Assets																Annual Change
($ in thousands, except ratios)	Sep. 2024			Jun. 2024			Mar. 2024			Dec. 2023			Sep. 2023
Commercial & Agriculture	$	2,899		$	2,781		$	897		$	748		$	717		$	2,182
% of Total Com./Ag. loans		1.54	%		1.48	%		0.49	%		0.39	%		0.40	%		304.3	%
Commercial RE		813			475			49			168			222			591
% of Total CRE loans		0.18	%		0.11	%		0.01	%		0.04	%		0.05	%		266.2	%
Residential RE		1,536			1,247			1,295			1,690			2,182			(646	)
% of Total Res. RE loans		0.49	%		0.39	%		0.41	%		0.53	%		0.68	%		-29.6	%
Consumer & Other		270			231			193			212			208			62
% of Total Con./Oth. loans		0.40	%		0.35	%		0.30	%		0.32	%		0.32	%		29.8	%
Total Nonaccruing Loans		5,518			4,734			2,434			2,818			3,329			2,189
% of Total loans		0.54	%		0.47	%		0.25	%		0.28	%		0.34	%		65.8	%
Foreclosed Assets and Other Assets		-			510			510			511			629			(629	)
Total Change (%)																	-100.0	%
Total Nonperforming Assets	$	5,518		$	5,244		$	2,944		$	3,329		$	3,958		$	1,560
% of Total assets		0.40	%		0.39	%		0.22	%		0.25	%		0.30	%		39.41	%

Webcast and Conference Call

The Company will hold the third quarter 2024 earnings conference call and webcast on October 25, 2024, at 11:00 a.m. EDT. Interested parties may access the conference call by dialing 1-888-338-9469. The webcast can be accessed at ir.yourstatebank.com. An audio replay of the call will be available on the Company’s website.

About SB Financial Group

Headquartered in Defiance, Ohio, SB Financial is a diversified financial services holding company for the State Bank & Trust Company (State Bank) and SBFG Title, LLC dba Peak Title (Peak Title). State Bank provides a full range of financial services for consumers and small businesses, including wealth management, private client services, mortgage banking and commercial and agricultural lending, operating through a total of 23 offices: 22 in nine Ohio counties and one in Fort Wayne, Indiana, and 23 ATMs. State Bank has six loan production offices located throughout the Tri-State region of Ohio, Indiana and Michigan. Peak Title provides title insurance and title opinions throughout the Tri-State region. SB Financial’s common stock is listed on the NASDAQ Capital Market with the ticker symbol “SBFG”.

Forward-Looking Statements

Certain statements within this document, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties, and actual results may differ materially from those predicted by the forward-looking statements. These risks and uncertainties include, but are not limited to, risks and uncertainties inherent in the national and regional banking industry, changes in economic conditions in the market areas in which SB Financial and its subsidiaries operate, changes in policies by regulatory agencies, changes in accounting standards and policies, changes in tax laws, fluctuations in interest rates, demand for loans in the market areas in SB Financial and its subsidiaries operate, increases in FDIC insurance premiums, changes in the competitive environment, losses of significant customers, geopolitical events, the loss of key personnel and other risks identified in SB Financial’s Annual Report on Form 10-K and documents subsequently filed by SB Financial with the Securities and Exchange Commission. Forward-looking statements speak only as of the date on which they are made, and SB Financial undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made, except as required by law. All subsequent written and oral forward-looking statements attributable to SB Financial or any person acting on its behalf are qualified by these cautionary statements.

Non-GAAP Financial Measures

This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP”). Non-GAAP financial measures, specifically pre-tax, pre-provision income, tangible common equity, tangible assets, tangible book value per common share, tangible common equity to tangible assets, return on average tangible common equity, total interest income – FTE, net interest income – FTE and net interest margin – FTE are used by the Company’s management to measure the strength of its capital and analyze profitability, including its ability to generate earnings on tangible capital invested by its shareholders. In addition, the Company excludes the OMSR valuation adjustment and any gain on sale of assets from net income to report a non-GAAP adjusted net income level. Although management believes these non-GAAP measures are useful to investors by providing a greater understanding of its business, they should not be considered a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

Investor Contact Information:

Mark A. KleinChairman, President and Chief Executive OfficerMark.Klein@YourStateBank.com

Anthony V. CosentinoExecutive Vice President and Chief Financial OfficerTony.Cosentino@YourStateBank.com

		SB FINANCIAL GROUP, INC.
		CONSOLIDATED BALANCE SHEETS - (Unaudited)
					September				June				March				December				September
			($ in thousands)			2024				2024				2024				2023				2023
ASSETS
	Cash and due from banks				$	49,348			$	21,983			$	26,602			$	22,965			$	19,049
	Interest bearing time deposits					1,706				2,417				2,417				1,535				1,180
	Available-for-sale securities					211,511				207,856				213,239				219,708				212,768
	Loans held for sale					8,927				7,864				4,730				2,525				3,206
	Loans, net of unearned income					1,029,955				1,005,390				991,552				1,000,212				989,021
	Allowance for credit losses					(15,278	)			(15,612	)			(15,643	)			(15,786	)			(15,790	)
	Premises and equipment, net					20,715				20,860				20,985				21,378				21,934
	Federal Reserve and FHLB Stock, at cost					5,223				5,204				6,512				7,279				6,261
	Foreclosed assets and other assets					-				510				510				511				629
	Interest receivable					4,842				4,818				3,706				4,657				6,673
	Goodwill					23,239				23,239				23,239				23,239				23,239
	Cash value of life insurance					30,488				30,294				30,103				29,121				29,291
	Mortgage servicing rights					14,357				14,548				14,191				13,906				13,893
	Other assets					8,916				12,815				13,869				11,999				15,120
			Total assets		$	1,393,949			$	1,342,186			$	1,336,012			$	1,343,249			$	1,326,474
LIABILITIES AND SHAREHOLDERS' EQUITY
	Deposits
		Non interest bearing demand			$	222,425			$	208,244			$	219,395			$	228,713			$	224,182
		Interest bearing demand				202,097				190,857				169,171				166,413				174,729
		Savings				241,761				231,855				244,157				216,965				226,077
		Money market				228,182				225,650				221,362				202,605				216,565
		Time deposits				265,068				258,582				258,257				255,509				243,766
			Total deposits			1,159,533				1,115,188				1,112,342				1,070,205				1,085,319
	Short-term borrowings					15,240				15,178				12,916				13,387				16,519
	Federal Home Loan Bank advances					35,000				35,000				35,000				83,600				59,500
	Trust preferred securities					10,310				10,310				10,310				10,310				10,310
	Subordinated debt net of issuance costs					19,678				19,666				19,654				19,642				19,630
	Interest payable					3,374				2,944				2,772				2,443				2,216
	Other liabilities					17,973				18,421				19,295				19,320				20,632
			Total liabilities			1,261,108				1,216,707				1,212,289				1,218,907				1,214,126
	Shareholders' Equity
		Common stock				61,319				61,319				61,319				61,319				61,319
		Additional paid-in capital				15,090				15,195				14,978				15,124				15,037
		Retained earnings				113,515				112,104				109,938				108,486				105,521
		Accumulated other comprehensive loss				(24,870	)			(31,801	)			(31,547	)			(29,831	)			(39,517	)
		Treasury stock				(32,213	)			(31,338	)			(30,965	)			(30,756	)			(30,012	)
			Total shareholders' equity			132,841				125,479				123,723				124,342				112,348
			Total liabilities and shareholders' equity		$	1,393,949			$	1,342,186			$	1,336,012			$	1,343,249			$	1,326,474

SB FINANCIAL GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME - (Unaudited)
($ in thousands, except per share & ratios)			At and for the Three Months Ended																				Nine Months Ended
			September				June				March				December				September				September				September
Interest income			2024				2024				2024				2023				2023				2024				2023
	Loans
	Taxable		$	14,513			$	13,883			$	13,547			$	13,438			$	13,128			$	41,943			$	37,969
	Tax exempt			127				124				123				124				122				374				359
	Securities
	Taxable			1,871				1,610				1,593				1,526				1,507				5,074				4,566
	Tax exempt			37				37				37				38				39				111				132
	Total interest income			16,548				15,654				15,300				15,126				14,796				47,502				43,026
Interest expense
	Deposits			5,568				5,208				5,090				4,398				4,194				15,866				10,310
	Repurchase agreements & other			43				36				34				39				16				113				35
	Federal Home Loan Bank advances			369				370				613				720				666				1,352				1,883
	Trust preferred securities			187				187				188				191				189				562				525
	Subordinated debt			195				194				195				194				195				584				584
	Total interest expense			6,362				5,995				6,120				5,542				5,260				18,477				13,337
Net interest income				10,186				9,659				9,180				9,584				9,536				29,025				29,689
	Provision for credit losses			200				-				-				(74	)			(6	)			200				389
Net interest income after provision
for loan losses				9,986				9,659				9,180				9,658				9,542				28,825				29,300
Noninterest income
	Wealth management fees			882				848				865				838				837				2,595				2,694
	Customer service fees			870				875				880				844				863				2,625				2,559
	Gain on sale of mtg. loans & OMSR			1,311				1,277				781				747				1,207				3,369				2,862
	Mortgage loan servicing fees, net			39				565				763				561				438				1,367				1,540
	Gain on sale of non-mortgage loans			20				105				10				177				10				135				252
	Title insurance revenue			485				406				266				378				429				1,157				1,257
	Net gain on sales of securities			-				-				-				1,453				-				-				-
	Gain (loss) on sale of assets			200				-				-				16				-				200				4
	Other			316				310				386				517				379				1,012				1,022
	Total noninterest income			4,123				4,386				3,951				5,531				4,163				12,460				12,190
Noninterest expense
	Salaries and employee benefits			6,057				6,009				5,352				5,652				5,491				17,418				17,125
	Net occupancy expense			706				707				769				746				764				2,182				2,350
	Equipment expense			1,069				1,060				1,077				1,027				1,068				3,206				3,051
	Data processing fees			758				727				769				680				648				2,254				1,979
	Professional fees			659				615				758				926				623				2,032				2,098
	Marketing expense			241				176				197				182				189				614				600
	Telephone and communication expense			128				156				105				132				124				389				369
	Postage and delivery expense			145				89				97				167				100				331				265
	State, local and other taxes			208				230				245				285				218				683				664
	Employee expense			228				159				178				146				141				565				485
	Other expenses			804				743				735				426				1,115				2,282				2,607
	Total noninterest expense			11,003				10,671				10,282				10,369				10,481				31,956				31,593
Income before income tax expense				3,106				3,374				2,849				4,820				3,224				9,329				9,897
	Income tax expense			752				261				481				937				537				1,494				1,685
Net income			$	2,354			$	3,113			$	2,368			$	3,883			$	2,687			$	7,835			$	8,212
Common share data:
	Basic earnings per common share		$	0.35			$	0.47			$	0.35			$	0.58			$	0.40			$	1.17			$	1.20
	Diluted earnings per common share		$	0.35			$	0.47			$	0.35			$	0.57			$	0.39			$	1.17			$	1.18
Average shares outstanding (in thousands):
	Basic:			6,660				6,692				6,715				6,748				6,791				6,689				6,857
	Diluted:			6,675				6,700				6,723				6,851				6,878				6,704				6,944

SB FINANCIAL GROUP, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS - (Unaudited)
($ in thousands, except per share & ratios)		At and for the Three Months Ended																				Nine Months Ended
		September				June				March				December				September				September				September
SUMMARY OF OPERATIONS		2024				2024				2024				2023				2023				2024				2023
Net interest income		$	10,186			$	9,659			$	9,180			$	9,584			$	9,536			$	29,025			$	29,689
Tax-equivalent adjustment			44				43				43				43				43				129				88
Tax-equivalent net interest income			10,230				9,702				9,223				9,627				9,579				29,154				29,777
Provision for credit loss			200				-				-				(74	)			(6	)			200				389
Noninterest income			4,123				4,386				3,951				5,531				4,163				12,460				12,190
Total operating revenue			14,309				14,045				13,131				15,115				13,699				41,485				41,879
Noninterest expense			11,003				10,671				10,282				10,369				10,481				31,956				31,593
Pre-tax pre-provision income			3,306				3,374				2,849				4,746				3,218				9,529				10,286
Net income			2,354				3,113				2,368				3,883				2,687				7,835				8,212
PER SHARE INFORMATION:
Basic earnings per share (EPS)			0.35				0.47				0.35				0.58				0.40				1.17				1.20
Diluted earnings per share			0.35				0.47				0.35				0.57				0.39				1.17				1.18
Common dividends			0.140				0.140				0.135				0.135				0.130				0.415				0.385
Book value per common share			20.05				18.80				18.46				18.50				16.59				20.05				16.59
Tangible book value per common share (TBV)			16.49				15.26				14.93				14.98				13.09				16.49				13.09
Market price per common share			20.56				14.00				13.78				15.35				13.50				20.56				13.50
Market price to TBV			124.7	%			91.8	%			92.3	%			102.5	%			103.1	%			124.7	%			103.1	%
Market price to trailing 12 month EPS			11.8				7.9				7.9				8.8				8.0				11.8				8.0
PERFORMANCE RATIOS:
Return on average assets (ROAA)			0.68	%			0.93	%			0.71	%			1.17	%			0.80	%			0.77	%			0.81	%
Pre-tax pre-provision ROAA			0.96	%			1.01	%			0.85	%			1.43	%			0.96	%			1.01	%			1.10	%
Return on average equity (ROE)			7.32	%			10.16	%			7.70	%			13.23	%			9.25	%			8.41	%			8.72	%
Return on average tangible equity			8.97	%			12.59	%			9.53	%			16.57	%			11.62	%			10.39	%			10.75	%
Efficiency ratio			76.78	%			75.86	%			78.17	%			68.44	%			79.00	%			76.91	%			75.28	%
Earning asset yield			5.16	%			5.02	%			4.97	%			4.89	%			4.78	%			5.05	%			4.61	%
Cost of interest bearing liabilities			2.53	%			2.47	%			2.55	%			2.33	%			2.18	%			2.52	%			1.85	%
Net interest margin			3.17	%			3.10	%			2.98	%			3.10	%			3.08	%			3.08	%			3.18	%
Tax equivalent effect			0.02	%			0.01	%			0.01	%			0.01	%			0.01	%			0.01	%			0.02	%
Net interest margin, tax equivalent			3.19	%			3.11	%			2.99	%			3.11	%			3.09	%			3.09	%			3.20	%
Non interest income/Average assets			1.20	%			1.31	%			1.19	%			1.67	%			1.24	%			1.23	%			1.21	%
Non interest expense/Average assets			3.20	%			3.18	%			3.08	%			3.12	%			3.13	%			3.15	%			3.13	%
Net noninterest expense/Average assets			-2.00	%			-1.87	%			-1.90	%			-1.46	%			-1.89	%			-1.92	%			-1.92	%
ASSET QUALITY RATIOS:
Gross charge-offs			29				-				66				5				12				95				113
Recoveries			2				16				9				1				7				27				25
Net charge-offs			27				(16	)			57				4				5				68				88
Nonperforming loans/Total loans			0.54	%			0.47	%			0.25	%			0.28	%			0.34	%			0.54	%			0.34	%
Nonperforming assets/Loans & OREO			0.54	%			0.52	%			0.30	%			0.33	%			0.40	%			0.54	%			0.40	%
Nonperforming assets/Total assets			0.40	%			0.39	%			0.22	%			0.25	%			0.30	%			0.40	%			0.30	%
Allowance for credit loss/Nonperforming loans			276.83	%			329.78	%			642.69	%			560.18	%			474.32	%			276.83	%			474.32	%
Allowance for credit loss/Total loans			1.48	%			1.55	%			1.58	%			1.58	%			1.60	%			1.48	%			1.60	%
Net loan charge-offs/Average loans (ann.)			0.01	%			(0.01	%)			0.02	%			0.00	%			0.00	%			0.01	%			0.01	%
CAPITAL & LIQUIDITY RATIOS:
Loans/ Deposits			88.82	%			90.15	%			89.14	%			93.46	%			91.13	%			88.82	%			91.13	%
Equity/ Assets			9.53	%			9.35	%			9.26	%			9.26	%			8.47	%			9.53	%			8.47	%
Tangible equity/Tangible assets			7.97	%			7.72	%			7.63	%			7.63	%			6.81	%			7.97	%			6.81	%
Common equity tier 1 ratio (Bank)			13.53	%			13.98	%			13.84	%			13.42	%			13.56	%			13.53	%			13.56	%
END OF PERIOD BALANCES
Total assets			1,393,949				1,342,186				1,336,012				1,343,249				1,326,474				1,393,949				1,326,474
Total loans			1,029,955				1,005,390				991,552				1,000,212				989,021				1,029,955				989,021
Deposits			1,159,533				1,115,188				1,112,342				1,070,205				1,085,319				1,159,533				1,085,319
Shareholders equity			132,841				125,479				123,723				124,342				112,348				132,841				112,348
Goodwill and intangibles			23,613				23,630				23,646				23,662				23,687				23,613				23,687
Tangible equity			109,228				101,849				100,077				100,680				88,661				109,228				88,661
Mortgage servicing portfolio			1,406,273				1,389,805				1,371,713				1,366,667				1,367,209				1,406,273				1,367,209
Wealth/Brokerage assets under care			557,724				525,713				525,517				501,829				478,236				557,724				478,236
Total assets under care			3,357,946				3,257,704				3,233,242				3,211,745				3,171,919				3,357,946				3,171,919
Full-time equivalent employees			248				249				245				251				252				248				252
Period end common shares outstanding			6,624				6,676				6,702				6,720				6,773				6,624				6,773
Market capitalization (all)			136,189				93,458				92,359				103,147				91,437				136,189				91,437
AVERAGE BALANCES
Total assets			1,376,849				1,342,847				1,333,236				1,327,415				1,339,870				1,350,580				1,344,467
Total earning assets			1,283,407				1,246,099				1,230,736				1,236,165				1,239,145				1,255,335				1,243,094
Total loans			1,018,262				1,005,018				993,310				992,337				989,089				1,005,577				982,817
Deposits			1,145,964				1,120,367				1,091,803				1,084,939				1,095,414				1,119,276				1,098,593
Shareholders equity			128,608				122,510				123,058				117,397				116,165				124,218				125,580
Goodwill and intangibles			23,621				23,638				23,654				23,675				23,698				23,638				23,720
Tangible equity			104,987				98,872				99,404				93,722				92,467				100,580				101,860
Average basic shares outstanding			6,660				6,692				6,715				6,748				6,791				6,689				6,857
Average diluted shares outstanding			6,675				6,700				6,723				6,851				6,878				6,704				6,944

SB FINANCIAL GROUP, INC.
	Rate Volume Analysis - (Unaudited)
	For the Three and Nine Months Ended Sep. 30, 2024 and 2023
	($ in thousands)		Three Months Ended Sep. 30, 2024									Three Months Ended Sep. 30, 2023
			Average					Average				Average					Average
Assets			Balance			Interest		Rate				Balance			Interest		Rate
	Taxable securities/cash		$	258,743		$	1,871	2.89	%			$	243,261		$	1,507	2.48	%
	Nontaxable securities			6,402			37	2.31	%				6,795			39	2.30	%
	Loans, net			1,018,262			14,640	5.75	%				989,089			13,250	5.36	%
	Total earning assets			1,283,407			16,548	5.16	%				1,239,145			14,796	4.78	%
	Cash and due from banks			4,334									4,022
	Allowance for loan losses			(15,601	)								(15,791	)
	Premises and equipment			20,820									22,120
	Other assets			83,889									90,374
	Total assets		$	1,376,849								$	1,339,870
Liabilities
	Savings, MMDA and interest bearing demand		$	659,879		$	2,969	1.80	%			$	620,092		$	2,232	1.44	%
	Time deposits			264,188			2,599	3.94	%				244,289			1,962	3.21	%
	Repurchase agreements & other			16,240			43	1.06	%				16,319			16	0.39	%
	Advances from Federal Home Loan Bank			35,054			369	4.21	%				55,073			666	4.84	%
	Trust preferred securities			10,310			187	7.26	%				10,310			189	7.33	%
	Subordinated debt			19,670			195	3.97	%				19,622			195	3.98	%
	Total interest bearing liabilities			1,005,341			6,362	2.53	%				965,705			5,260	2.18	%
	Non interest bearing demand			221,897			-						231,033			-
	Total funding			1,227,238				2.07	%				1,196,738				1.76	%
								44.20	%							1
	Other liabilities			21,003									26,967
	Total liabilities			1,248,241									1,223,705
	Equity			128,608									116,165
	Total liabilities and equity		$	1,376,849								$	1,339,870			-
	Net interest income					$	10,186								$	9,536
	Net interest income as a percent of average interest-earning assets - GAAP measure							3.17	%								3.08	%
	Net interest income as a percent of average interest-earning assets - non GAAP							3.19	%								3.09	%
	- Computed on a fully tax equivalent (FTE) basis
			Nine Months Ended Sep. 30, 2024									Nine Months Ended Sep. 30, 2023
			Average					Average				Average					Average
Assets			Balance			Interest		Rate				Balance			Interest		Rate
	Taxable securities/cash		$	243,335		$	5,074	2.78	%			$	252,908		$	4,566	2.41	%
	Nontaxable securities			6,423			111	2.30	%				7,369			132	2.39	%
	Loans, net			1,005,577			42,317	5.61	%				982,817			38,328	5.20	%
	Total earning assets			1,255,335			47,502	5.05	%				1,243,094			43,026	4.61	%
	Cash and due from banks			4,430									4,020
	Allowance for loan losses			(15,693	)								(15,374	)
	Premises and equipment			21,026									22,500
	Other assets			85,482									90,227
	Total assets		$	1,350,580								$	1,344,467
Liabilities
	Savings, MMDA and interest bearing demand		$	634,122		$	8,270	1.74	%			$	627,074		$	5,367	1.14	%
	Time deposits			260,061			7,596	3.89	%				233,054			4,943	2.83	%
	Repurchase agreements & Other			14,708			113	1.02	%				16,576			35	0.28	%
	Advances from Federal Home Loan Bank			40,466			1,352	4.45	%				53,936			1,883	4.65	%
	Trust preferred securities			10,310			562	7.27	%				10,310			525	6.79	%
	Subordinated debt			19,658			584	3.96	%				19,610			584	3.97	%
	Total interest bearing liabilities			979,325			18,477	2.52	%				960,560			13,337	1.85	%
	Non interest bearing demand			225,093				2.05	%				238,465				1.48	%
	Total funding			1,204,418									1,199,025
	Other liabilities			21,944									19,862
	Total liabilities			1,226,362									1,218,887
	Equity			124,218									125,580
	Total liabilities and equity		$	1,350,580								$	1,344,467
	Net interest income					$	29,025								$	29,689
	Net interest income as a percent of average interest-earning assets - GAAP measure							3.08	%								3.18	%
	Net interest income as a percent of average interest-earning assets - non GAAP							3.09	%								3.20	%
	- Computed on a fully tax equivalent (FTE) basis

Non-GAAP reconciliation		Three Months Ended								Nine Months Ended
($ in thousands, except per share & ratios)		Sep. 30, 2024				Sep. 30, 2023				Sep. 30, 2024				Sep. 30, 2023
Total Operating Revenue		$	14,309			$	13,699			$	41,485			$	41,879
Adjustment to (deduct)/add OMSR recapture/impairment *			465				78				246				39
Adjusted Total Operating Revenue			14,774				13,777				41,731				41,918
Income before Income Taxes			3,106				3,224				9,329				9,897
Adjustment for OMSR *			465				78				246				39
Adjusted Income before Income Taxes			3,571				3,302				9,575				9,936
Provision for Income Taxes			752				537				1,494				1,685
Adjustment for OMSR **			98				16				52				8
Adjusted Provision for Income Taxes			850				553				1,546				1,693
Net Income			2,354				2,687				7,835				8,212
Adjustment for OMSR *			367				62				194				31
Adjusted Net Income			2,721				2,749				8,029				8,243
Diluted Earnings per Share			0.35				0.39				1.17				1.18
Adjustment for OMSR *			0.06				0.01				0.03				0.00
Adjusted Diluted Earnings per Share		$	0.41			$	0.40			$	1.20			$	1.19
Return on Average Assets			0.68	%			0.80	%			0.77	%			0.81	%
Adjustment for OMSR *			0.11	%			0.02	%			0.01	%			0.00	%
Adjusted Return on Average Assets			0.79	%			0.82	%			0.79	%			0.82	%
*valuation adjustment to the Company's mortgage servicing rights
**tax effect is calculated using a 21% statutory federal corporate income tax rate