First Bancshares Inc.

120 North Street

Bellevue, Ohio 44811

419-483-7340 Fax 419-483-0006

 

Dear Shareholder,

The board of directors of First Bancshares, Inc. (the “Company”) has declared a fourth quarter
dividend in the amount of thirty-three cents ($0.33) per share that is enclosed or has been direct
deposited per your instructions. Additional shares of First Bancshares stock will be purchased for
those participating in the dividend reinvestment plan. We are pleased to be able to deliver
consistent dividend returns throughout 2025 and are committed to future growth and financial
strength as we start the new year.

We have attached the traditional financial comparison sheet, including supplemental data, to show
the results for 2025 compared to 2024. Of most significance, we repositioned our balance sheet with
a significant securities buy/sell transaction in 03, as detailed in the October 2025 shareholder
letter, which is available on our website at fnblifetime.com. This was immediately accretive to
monthly earnings and will continue to enhance our ability to deliver on our core loan growth and
profitability objectives in the coming years. Also, the securities transactions will provide
favorable tax benefits in the immediate future as well.

2025 was a year of leadership transition for First National Bank, as our long time President & CEO,
Dean Miller, retired in May. Thank you to those who were able to join in our celebration of Dean’s
service, and the 150th Anniversary of the bank! Also, during the year, we took the opportunity to
separate the responsibilities of sales management and credit administration within our
organizational structure. This provided us with the opportunity to hire a Senior Lender for sales
oversight and promote from within the bank to lead our Credit Administration effort. Both moves
position us for a more efficient and responsive loan process, with enhanced risk management and
oversight.

During the year, we experienced interest rate cuts that modestly affected both loan interest income
and deposit funding costs. Loan demand was softer than expected, resulting in a year over year
decrease of $223k in Loan Interest Income, partially offset by $86k in lower deposit funding costs.
Improved Investment and Fed Funds income of $1,060k helped cover increased Non-Interest Expenses of
$291k and enabled the bank to add to its loan loss reserves, taking a conservative approach to the
economic uncertainty that persists. Our loan portfolio continues to perform well, while our risk
management practices remain strong.

With 2025 behind us, we are working with our external auditors to prepare our annual report with
audited financial statements. This report will be available in March when we send it out to
shareholders with the proxies for the annual meeting. The annual meeting will be held on May 6th at
the main office in Bellevue. We hope you can join us. The board of directors, senior management and
the entire banking team remains committed to our core values of top-quality customer service, high
integrity, loyalty to our shareholders and communities, employee development, sound risk management
and superior financial strength and stability. Looking forward to our future together.

 

Sincerely,

Jeffrey S. Bechtel – President & CEO

James V. Stouffer, Jr. – Chairman

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1!7F’�
Jeffrey S. Bechtel
President & CEO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sincerely,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

James V. Stouffer, Jr.
Chairman