First Bancshares, Inc.
120 North Street, Bellevue, Ohio 44811
419-483-7340 – Fax 419-483-0006

July 21, 2025

Dear Shareholder,

The board of directors of First Bancshares, Inc. have declared a first-quarter dividend in the amount of thirty-three cents ($0.33) per share which is equal to the prior quarterly payment made in April. We continue to balance the return to our shareholders while retaining the appropriate capital levels to support the growth of the bank. This payment is enclosed or has been direct deposited for those that are electing cash payments. Additional shares of First Bancshares stock will be purchased for those that are part of the dividend reinvestment plan.

From the summary financial statistics worksheet, we have noted the bank’s net income for the first half of 2025, which decreased by $95k compared to the same period in 2024. Interest income increased by $74k year over year, as loan balances declined by $6MM, slightly offset by a 7bps rate improvement in the portfolio. Total deposits increased by $24.8MM, while total borrowings were down by $17.1MM, resulting in a $280k net improvement to the bank’s funding costs. The resulting net interest income improved by $354k year over year.

The net interest Income improvement for the half of 2025 was more than offset by certain non-interest expenses, resulting in a year over year decline in net income of $95k. The primary non-recurring charges for the first half that influenced net income relate to the CEO transition in Q2 and the related retirement and onboarding expenses therein. NSF checking fees, Visa interchange income and Gain on Sale to FNMA were down year over year as well. Outside loan servicing, Consultant’s & Compliance Fees and certain other tax and accruals contributed to the earnings offset for the quarter.

While interest rates, inflation and unemployment remain stable year over year, consumer sentiment and spending trends have fallen in 2025, which represent a sizable portion of the U.S. economy. We continue to monitor this closely through our customer-facing business units, including commercial and residential lending groups and branch consumer lending. We are adding bankers to our team to increase our commitment to loan growth in our markets. We are also assessing strategies to make our balance sheet more efficient to fund securities purchases at today’s returns, while availing funding for planned loan growth.

Our loan portfolio continues to perform well. Certain consumer-related business clients continue to experience some softening in demand for their products. We are managing these client relationships to ensure that the bank’s risk is managed appropriately.

We remain optimistic about the balance of 2025. Our team will continue to focus on serving the needs of our loyal customers, while increasing our efforts to attract new clients to FNB, so to best position us for future growth opportunities. On behalf of the board and staff, we thank you for your support and look forward to a prosperous second half of 2025.

Sincerely,

James V. Stouffer Jr. Chairman

Jeffrey S. Bechtel President & CEO