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What changed in FIRST BUSEY CORP /NV/'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of FIRST BUSEY CORP /NV/'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+353 added−333 removedSource: 10-K (2026-02-26) vs 10-K (2025-02-27)

Top changes in FIRST BUSEY CORP /NV/'s 2025 10-K

353 paragraphs added · 333 removed · 211 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

77 edited+18 added−38 removed16 unchanged
Biggest changeThe geographic distribution of loans originated in each of these markets is presented in the tables below (dollars in thousands) : As of December 31, 2024 Illinois Missouri Florida Indiana Total Commercial loans C&I and other commercial $ 1,493,670 $ 276,140 $ 58,277 $ 76,428 $ 1,904,515 CRE 2,285,915 560,337 245,918 177,394 3,269,564 Real estate construction 232,898 40,816 30,826 73,669 378,209 Total commercial loans 4,012,483 877,293 335,021 327,491 5,552,288 Retail loans Retail real estate 1,275,834 211,878 128,352 80,393 1,696,457 Retail other 443,164 3,731 683 764 448,342 Total retail loans 1,718,998 215,609 129,035 81,157 2,144,799 Total portfolio loans $ 5,731,481 $ 1,092,902 $ 464,056 $ 408,648 $ 7,697,087 ACL (83,404) Portfolio loans, net of ACL $ 7,613,683 As of December 31, 2023 Illinois Missouri Florida Indiana Total Commercial loans C&I and other commercial $ 1,395,020 $ 369,767 $ 25,267 $ 45,940 $ 1,835,994 CRE 2,278,348 671,762 219,511 167,716 3,337,337 Real estate construction 255,879 74,805 72,121 58,912 461,717 Total commercial loans 3,929,247 1,116,334 316,899 272,568 5,635,048 Retail loans Retail real estate 1,284,362 225,610 129,454 81,029 1,720,455 Retail other 290,937 2,344 1,111 1,139 295,531 Total retail loans 1,575,299 227,954 130,565 82,168 2,015,986 Total portfolio loans $ 5,504,546 $ 1,344,288 $ 447,464 $ 354,736 $ 7,651,034 ACL (91,740) Portfolio loans, net of ACL $ 7,559,294 First Busey Corporation (BUSE) | 2024 — 72 Table of Contents Contents of Item 7.
Biggest changeThe geographic distribution of Busey Bank loans outstanding as of December 31, 2024, that were originated in each of these markets is presented in the table below: As of December 31, 2024 (dollars in thousands) C&I and other commercial CRE Real estate construction Retail real estate Retail other Total Loans by state of origination Illinois $ 1,493,670 $ 2,285,915 $ 232,898 $ 1,275,834 $ 443,164 $ 5,731,481 Missouri 276,140 560,337 40,816 211,878 3,731 1,092,902 Florida 58,277 245,918 30,826 128,352 683 464,056 Indiana 76,428 177,394 73,669 80,393 764 408,648 Total portfolio loans $ 1,904,515 $ 3,269,564 $ 378,209 $ 1,696,457 $ 448,342 7,697,087 ACL (83,404) Portfolio loans, net of ACL $ 7,613,683 First Busey Corporation (BUSE) | 2025 — 77 Table of Contents Contents of Item 7.
Real estate construction loans will generally be guaranteed, in full or a material percentage, by the developer or primary owners of the business. These loans are subject to underwriting standards and guidelines similar to commercial loans. The loan generally must be supported by an adequate “as completed” value of the underlying project.
Real estate construction loans will generally be guaranteed, in full or a material percentage, by the developer or primary owners of the business. These loans are subject to underwriting standards and guidelines similar to commercial loans and generally must be supported by an adequate “as completed” value of the underlying project.
MD&A Portfolio Loans Busey believes that making sound and profitable loans is a necessary and desirable means of employing funds available for investment. Busey maintains lending policies and procedures designed to focus lending efforts on the types, locations, and duration of loans most appropriate for its business model and markets.
Portfolio Loans Busey believes that making sound and profitable loans is a necessary and desirable means of employing funds available for investment. Busey maintains lending policies and procedures designed to focus lending efforts on the types, locations, and duration of loans most appropriate for its business model and markets.
Potential Problem Loans Potential problem loans are loans classified as substandard which are not individually evaluated, non-accrual, or 90+ days past due, but where current information indicates that the borrower may not be able to comply with loan repayment terms.
Potential Problem Loans Potential problem loans are loans classified as substandard that are not individually evaluated, non-accrual, or 90+ days past due, but where current information indicates that the borrower may not be able to comply with loan repayment terms.
Estimates of credit losses are based on a careful consideration of all significant factors affecting the collectability as of the evaluation date. The ACL is established through the provision for credit loss expense charged to income.
Estimates of credit losses are based on a careful consideration of all significant factors affecting the collectability as of the evaluation date. The ACL is established through the provision for credit loss charged to income.
Busey considers many factors in determining the composition of its investment portfolio including, but not limited to, credit quality, duration, interest rate risk, liquidity, tax-equivalent yield, regulatory considerations, and overall portfolio allocation. As of December 31, 2024, Busey did not hold general obligation bonds of any single issuer, the aggregate of which exceeded 10% of Busey’s stockholders’ equity.
Busey considers many factors in determining the composition of its investment portfolio including, but not limited to, credit quality, duration, interest rate risk, liquidity, tax-equivalent yield, regulatory considerations, and overall portfolio allocation. As of December 31, 2025, Busey did not hold general obligation bonds of any single issuer, the aggregate of which exceeded 10% of Busey’s stockholders’ equity.
Management continues to monitor these loans and work with the borrowers on restructurings, guarantees, additional collateral, or other planned actions. As of December 31, 2024, management identified no other loans that represent or result from trends or uncertainties that would be expected to materially impact future operating results, liquidity, or capital resources.
Management continues to monitor these loans and work with the borrowers on restructurings, guarantees, additional collateral, or other planned actions. As of December 31, 2025, management identified no other loans that represent or result from trends or uncertainties that would be expected to materially impact future operating results, liquidity, or capital resources.
Repayment of these loans is primarily dependent on the cash flows of the underlying property. However, CRE loans generally must be supported by an adequate underlying collateral value. The performance and the value of the underlying property may be adversely affected by economic factors or geographical and/or industry specific factors.
Repayment of these loans is primarily dependent on the cash flows of the underlying property. Nevertheless, CRE loans generally must be supported by an adequate underlying collateral value. The performance and the value of the underlying property may be adversely affected by economic factors or geographical and/or industry specific factors.
Retail Real Estate Loans Retail real estate loans are comprised of direct consumer loans that include residential real estate, home equity lines of credit, and home equity loans. In 2024, Busey retained a smaller percentage of originated retail real estate loans in its portfolio, electing to sell a larger percentage to secondary market purchasers.
Retail Real Estate Loans Retail real estate loans are comprised of direct consumer loans that include residential real estate, home equity lines of credit, and home equity loans. In 2025, Busey retained a smaller percentage of originated retail real estate loans in its portfolio, electing to sell a larger percentage to secondary market purchasers.
The table below presents minimum capital ratios that include the capital conservation buffer in comparison to the capital ratios for First Busey and Busey Bank as of December 31, 2024.
The table below presents minimum capital ratios that include the capital conservation buffer in comparison to the capital ratios for First Busey and Busey Bank as of December 31, 2025.
Fluctuations in sales of loans held for sale are a function of changes in market rates for mortgage loans, which influence refinance activity. Net cash provided by investing activities totaled $657.9 million in 2024, compared to $551.0 million provided by investing activities in 2023. Significant investing activities are those associated with managing Busey’s investment and loan portfolios.
Fluctuations in sales of loans held for sale are a function of changes in market rates for mortgage loans, which influence refinance activity. Net cash provided by investing activities totaled $1.10 billion in 2025, compared to $657.9 million provided by investing activities in 2024. Significant investing activities are those associated with managing Busey’s investment and loan portfolios.
Repayment of retail other loans is expected from the borrower’s cash flows. First Busey Corporation (BUSE) | 2024 — 70 Table of Contents Contents of Item 7.
Repayment of retail other loans is expected from the borrower’s cash flows. First Busey Corporation (BUSE) | 2025 — 75 Table of Contents Contents of Item 7.
For additional information regarding interest rates and changes in net interest income see “ Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operation — Three Years Ended December 31, 2024—Consolidated Average Balance Sheets and Interest Rates ” and “ Item 7A.
For additional information regarding interest rates and changes in net interest income see “ Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operation — Three Years Ended December 31, 2025—Net Interest Income ” and “ Item 7A.
Net cash flows provided by operating activities totaled $178.3 million in 2024, compared to $173.4 million provided by operating activities in 2023. Significant operating activities affecting cash flows include net income, depreciation and amortization, the provision for credit losses, stock-based compensation, and mortgage loan sale activity.
MD&A Net cash flows provided by operating activities totaled $192.6 million in 2025, compared to $178.3 million provided by operating activities in 2024. Significant operating activities affecting cash flows include net income, depreciation and amortization, the provision for credit losses, stock-based compensation, and mortgage loan sale activity.
Quantitative and Qualitative Disclosures About Market Risk .” First Busey Corporation (BUSE) | 2024 — 86 Table of Contents
Quantitative and Qualitative Disclosures About Market Risk .” First Busey Corporation (BUSE) | 2025 — 88 Table of Contents
Additional liquidity is provided by the ability to borrow from the FHLB, the Federal Reserve Bank, and Busey’s revolving credit facility, as summarized in the table below (dollars in thousands) : As of December 31, 2024 2023 Additional available borrowing capacity FHLB $ 1,679,463 $ 1,898,737 Federal Reserve Bank 664,083 598,878 Federal funds purchased 477,500 482,500 Revolving credit facility 40,000 40,000 Additional borrowing capacity $ 2,861,046 $ 3,020,115 Further, Busey could utilize brokered deposits as additional sources of liquidity, as needed.
Additional liquidity is provided by the ability to borrow from the FHLB, the Federal Reserve Bank, and Busey’s revolving credit facility, as summarized in the table below: As of December 31, (dollars in thousands) 2025 2024 Additional available borrowing capacity FHLB $ 1,775,157 $ 1,679,463 Federal Reserve Bank 1,585,816 664,083 Federal funds purchased 485,000 477,500 Revolving credit facility 40,000 40,000 Additional borrowing capacity $ 3,885,973 $ 2,861,046 Further, Busey could utilize brokered deposits as additional sources of liquidity, as needed.
MD&A The following table sets forth the distribution of short-term borrowings and securities sold under agreements to repurchase, as well as the weighted average interest rates thereon (dollars in thousands) : Years Ended December 31, 2024 2023 2022 Securities sold under agreements to repurchase Balance at end of period $ 155,610 $ 187,396 $ 229,806 Weighted average interest rate at end of period 2.63 % 3.26 % 1.91 % Maximum outstanding at any month end in year-to-date period $ 214,567 $ 248,850 $ 283,664 Average daily balance for the year-to-date period 147,588 200,702 243,690 Weighted average interest rate during period 1 2.91 % 2.58 % 0.60 % FHLB advances, current portion due within 12 months Balance at end of period $ — $ — $ 339,054 Weighted average interest rate at end of period — % — % 4.28 % Maximum outstanding at any month end in year-to-date period $ 24,100 $ 603,881 $ 339,054 Average daily balance for the year-to-date period 7,018 241,382 25,845 Weighted average interest rate during period 1 5.54 % 4.90 % 4.28 % Term Loan, current portion due within 12 months Balance at end of period $ — $ 12,000 $ 12,000 Weighted average interest rate at end of period — % 7.14 % 5.92 % Maximum outstanding at any month end in year-to-date period $ 12,000 $ 12,000 $ 12,000 Average daily balance for the year-to-date period 2,853 12,000 12,000 Weighted average interest rate during period 1 7.26 % 6.88 % 3.55 % ___________________________________________ 1.
MD&A The following table sets forth the distribution of securities sold under agreements to repurchase and short-term borrowings, as well as the weighted average interest rates thereon: Years Ended December 31, (dollars in thousands) 2025 2024 2023 Securities sold under agreements to repurchase Balance at end of period $ 166,929 $ 155,610 $ 187,396 Weighted average interest rate at end of period 2.22 % 2.63 % 3.26 % Maximum outstanding at any month end in year-to-date period $ 166,929 $ 214,567 $ 248,850 Average daily balance for the year-to-date period 149,724 147,588 200,702 Weighted average interest rate during period 1 2.47 % 2.91 % 2.58 % FHLB advances, current portion due within 12 months Balance at end of period $ — $ — $ — Weighted average interest rate at end of period — % — % — % Maximum outstanding at any month end in year-to-date period $ 76,911 $ 24,100 $ 603,881 Average daily balance for the year-to-date period 11,698 7,018 241,382 Weighted average interest rate during period 1 4.45 % 5.54 % 4.90 % Term Loan, current portion due within 12 months Balance at end of period $ — $ — $ 12,000 Weighted average interest rate at end of period — % — % 7.14 % Maximum outstanding at any month end in year-to-date period $ — $ 12,000 $ 12,000 Average daily balance for the year-to-date period — 2,853 12,000 Weighted average interest rate during period 1 — % 7.26 % 6.88 % ___________________________________________ 1.
MD&A The following table sets forth the ACL by loan categories and percentage of loans to total loans as of December 31 for each of the years indicated (dollars in thousands) : As of December 31, 2024 2023 ACL % of Loans to Total Loans ACL % of Loans to Total Loans Loan Category C&I and other commercial $ 21,589 24.8 % $ 21,256 24.0 % CRE 32,301 42.5 % 35,465 43.6 % Real estate construction 3,345 4.9 % 5,163 6.0 % Retail real estate 23,711 22.0 % 26,298 22.5 % Retail other 2,458 5.8 % 3,558 3.9 % Total $ 83,404 100.0 % $ 91,740 100.0 % Busey did not record an allowance for credit loss for its Life Equity Loan ® portfolio, a component of its retail other lending activity, due to no expected credit loss at default, as permitted under the practical expedient provided within ASC 326-20-35-6.
MD&A The following table sets forth the ACL by loan categories and percentage of loans to total loans as of December 31 for each of the years indicated: As of December 31, 2025 2024 (dollars in thousands) ACL % of Loans to Total Loans ACL % of Loans to Total Loans Loan Category C&I and other commercial $ 61,370 31.2 % $ 21,589 24.8 % CRE 70,328 40.9 % 32,301 42.5 % Real estate construction 11,568 7.6 % 3,345 4.9 % Retail real estate 29,178 15.9 % 23,711 22.0 % Retail other 1,579 4.4 % 2,458 5.8 % Total $ 174,023 100.0 % $ 83,404 100.0 % Busey did not record an allowance for loan losses for its Life Equity Loan ® portfolio, a component of its retail other lending activity, due to no expected credit loss at default, as permitted under the practical expedient provided within ASC 326-20-35-6.
Securities are presented based upon final contractual maturity or pre-refunded date. 2. Weighted average yield calculated on a tax-equivalent basis, assuming a federal income tax rate of 21.0%. First Busey Corporation (BUSE) | 2024 — 67 Table of Contents Contents of Item 7. MD&A Debt Securities Held to Maturity Debt securities held to maturity are carried at amortized cost.
Securities are presented based upon final contractual maturity or pre-refunded date. 2. Weighted average yield calculated on a tax-equivalent basis, assuming a federal income tax rate of 21.0%. Debt Securities Held to Maturity Debt securities held to maturity are carried at amortized cost.
Risk-based capital ratios are established by allocating assets and certain off-balance-sheet commitments into risk-weighted categories. These balances are then multiplied by the factor appropriate for that risk-weighted category. In order to refrain from restrictions on dividends, equity repurchases, and discretionary bonus payments, banking institutions must maintain capital in excess of regulatory minimum capital requirements.
These balances are then multiplied by the factor appropriate for that risk-weighted category. In order to refrain from restrictions on dividends, equity repurchases, and discretionary bonus payments, banking institutions must maintain capital in excess of regulatory minimum capital requirements.
Classified assets represented 5.61% of Busey Bank’s Tier 1 capital and ACL at December 31, 2024, up from 4.97% at December 31, 2023. Net charge-offs totaled $18.2 million in 2024, representing 0.23% of average loans, compared with net charge-offs of $2.3 million in 2023, representing 0.03% of average loans.
Classified assets represented 7.51% of Busey Bank’s Tier 1 capital and ACL at December 31, 2025, up from 5.61% at December 31, 2024. Net charge-offs totaled $55.9 million in 2025, representing 0.44% of average loans, compared with net charge-offs of $18.2 million in 2024, representing 0.23% of average loans.
While a financial institution’s operating expenses, particularly salaries, wages, and employee benefits, are affected by general inflation, the asset and liability structure of a financial institution consists largely of monetary items.
EFFECTS OF INFLATION The effect of inflation on a financial institution differs significantly from the effect on an industrial company. While a financial institution’s operating expenses, particularly salaries, wages, and employee benefits, are affected by general inflation, the asset and liability structure of a financial institution consists largely of monetary items.
Net cash used in financing activities totaled $858.1 million in 2024, compared to $232.0 million used in financing activities in 2023. Significant financing activities affecting cash flows include deposit and other borrowings, as well as cash dividends paid. For additional detail, see the Consolidated Statements of Cash Flows .
Net cash used in financing activities totaled $1.69 billion in 2025, compared to $858.1 million used in financing activities in 2024. Significant financing activities affecting cash flows include deposit and other borrowings, issuance of preferred stock, and cash dividends paid. For additional detail, see the Consolidated Statements of Cash Flows .
First Busey Corporation (BUSE) | 2024 — 82 Table of Contents Contents of Item 7. MD&A Liquidity Liquidity management is the process by which Busey ensures that adequate liquid funds are available to meet the present and future cash flow obligations arising in the daily operations of its business.
Liquidity Liquidity management is the process by which Busey ensures that adequate liquid funds are available to meet the present and future cash flow obligations arising in the daily operations of its business.
Loan Maturities The determination of loan maturities is based on contractual loan terms. Demand loans, loans having no stated schedule of repayments and no stated maturity, and overdrafts are considered to mature within one year.
Loan Maturities The determination of loan maturities is based on contractual loan terms. Demand loans, loans having no stated schedule of repayments and no stated maturity, and overdrafts are considered to mature within one year. First Busey Corporation (BUSE) | 2025 — 78 Table of Contents Contents of Item 7.
Contractual Obligations Busey has entered into certain contractual obligations and other commitments that generally relate to funding of operations through deposits, debt issuance, and property and equipment leases. First Busey Corporation (BUSE) | 2024 — 84 Table of Contents Contents of Item 7.
Contractual Obligations Busey has entered into certain contractual obligations and other commitments that generally relate to funding of operations through deposits, debt issuance, and property and equipment leases.
As of December 31, 2024, Busey management believed the level of the allowance to be appropriate based upon the information available. However, additional losses may be identified in the loan portfolio as new information is obtained.
The Life Equity Loan ® portfolio balance was $445.4 million as of December 31, 2025, and $264.2 million as of December 31, 2024. As of December 31, 2025, Busey management believed the level of the allowance to be appropriate based upon the information available. However, additional losses may be identified in the loan portfolio as new information is obtained.
Minimum Capital Requirements with Capital Buffer As of December 31, 2024 First Busey Busey Bank Common Equity Tier 1 Capital to Risk Weighted Assets 7.00 % 14.10 % 16.46 % Tier 1 Capital to Risk Weighted Assets 8.50 % 14.98 % 16.46 % Total Capital to Risk Weighted Assets 10.50 % 18.53 % 17.40 % Leverage Ratio of Tier 1 Capital to Average Assets 6.50 % 11.06 % 12.14 % Management believes that no conditions or events have occurred since December 31, 2024, that would materially adversely change First Busey’s or Busey Bank’s capital classifications.
Minimum Capital Requirements with Capital Buffer As of December 31, 2025 First Busey Busey Bank Common equity Tier 1 capital to risk weighted assets 7.00 % 12.43 % 13.97 % Tier 1 capital to risk weighted assets 8.50 % 13.88 % 13.97 % Total capital to risk weighted assets 10.50 % 15.93 % 14.86 % Leverage ratio of Tier 1 capital to average assets 4.00 % 11.93 % 12.00 % Management believes that no conditions or events have occurred since December 31, 2025, that would materially adversely change First Busey’s or Busey Bank’s capital classifications.
Non-Performing Loans and Non-Performing Assets Loans are considered past due if the required principal or interest payments have not been received as of the date such payments were due. Loans are placed on non-accrual status when, in management’s opinion, the borrower may be unable to meet payment obligations as they become due, as well as when required by regulatory guidelines.
Loans are placed on non-accrual status when, in management’s opinion, the borrower may be unable to meet payment obligations as they become due, as well as when required by regulatory guidelines. Loans may be placed on non-accrual status regardless of whether or not such loans are considered past due.
Busey’s ACL coverage decreased to 3.59 times its non-performing loan balance at December 31, 2024, compared to 11.74 times its non-performing loan balance at December 31, 2023. First Busey Corporation (BUSE) | 2024 — 77 Table of Contents Contents of Item 7.
Busey’s ACL was 3.25 times its non-performing loan balance at December 31, 2025, compared to 3.59 times its non-performing loan balance at December 31, 2024. First Busey Corporation (BUSE) | 2025 — 82 Table of Contents Contents of Item 7.
First Busey Corporation (BUSE) | 2024 — 76 Table of Contents Contents of Item 7.
First Busey Corporation (BUSE) | 2025 — 81 Table of Contents Contents of Item 7.
First Busey Corporation (BUSE) | 2024 — 78 Table of Contents Contents of Item 7.
First Busey Corporation (BUSE) | 2025 — 86 Table of Contents Contents of Item 7.
Securities are presented based upon final contractual maturity or pre-refunded date. Equity Securities Equity securities are carried at fair value. The fair value of equity securities was $15.9 million as of December 31, 2024, compared to $9.8 million as of December 31, 2023. First Busey Corporation (BUSE) | 2024 — 68 Table of Contents Contents of Item 7.
Securities are presented based upon final contractual maturity or pre-refunded date. Equity Securities Equity securities are carried at fair value. The fair value of equity securities was $14.9 million as of December 31, 2025, compared to $15.9 million as of December 31, 2024.
Management assesses the potential for loss on such loans and considers the effect of any potential loss in determining its provision for expected credit losses. Potential problem loans decreased to $62.0 million at December 31, 2024, compared to $64.3 million at December 31, 2023.
Management assesses the potential for loss on such loans and considers the effect of any potential loss in determining its provision for expected credit losses. Potential problem loans increased to $116.4 million, or 0.9% of portfolio loans, as of December 31, 2025, compared to $62.0 million, or 0.8% of portfolio loans, as of December 31, 2024.
MD&A The following table summarizes, by lending activity, net charge-off and recovery activity affecting the ACL balance, together with average portfolio loans outstanding and the related ratios of net charge-offs (recoveries) to average portfolio loans (dollars in thousands) : ACL Average Portfolio Loans Outstanding Ratio of Net Charge-offs (Recoveries) To Average Portfolio Loans ACL balance, December 31, 2021 $ 87,887 Net (charge-offs) recoveries and average portfolio loans by loan category: C&I and other commercial (492) $ 1,919,227 0.03 % CRE (842) 3,200,166 0.03 % Real estate construction 213 466,045 (0.05) % Retail real estate 385 1,584,859 (0.02) % Retail other (166) 275,665 0.06 % Net (charge-offs) recoveries and average portfolio loans (902) $ 7,445,962 0.01 % Provision for credit losses 4,623 ACL balance, December 31, 2022 91,608 Net (charge-offs) recoveries and average portfolio loans by loan category: C&I and other commercial (1,877) $ 1,910,008 0.10 % CRE (379) 3,316,633 0.01 % Real estate construction 171 536,280 (0.03) % Retail real estate 183 1,689,868 (0.01) % Retail other (365) 306,683 0.12 % Net (charge-offs) recoveries and average portfolio loans (2,267) $ 7,759,472 0.03 % Provision for credit losses 2,399 ACL balance, December 31, 2023 91,740 Day 1 PCD 1 1,243 Net (charge-offs) recoveries and average portfolio loans by loan category: C&I and other commercial (14,946) $ 1,892,293 0.79 % CRE (3,168) 3,361,644 0.09 % Real estate construction 67 416,439 (0.02) % Retail real estate 348 1,714,681 (0.02) % Retail other (470) 419,572 0.11 % Net (charge-offs) recoveries and average portfolio loans (18,169) $ 7,804,629 0.23 % Provision for credit losses 8,590 ACL balance, December 31, 2024 $ 83,404 ___________________________________________ 1.
MD&A The following table summarizes, by lending activity, net charge-off and recovery activity affecting the ACL balance, together with average portfolio loans outstanding and the related ratios of net charge-offs (recoveries) to average portfolio loans: (dollars in thousands) ACL Average Portfolio Loans Outstanding Ratio of Net Charge-offs (Recoveries) To Average Portfolio Loans ACL balance, December 31, 2022 $ 91,608 Net (charge-offs) recoveries and average portfolio loans by lending activity: C&I and other commercial (1,877) $ 1,910,008 0.10 % CRE (379) 3,316,633 0.01 % Real estate construction 171 536,280 (0.03) % Retail real estate 183 1,689,868 (0.01) % Retail other (365) 306,683 0.12 % Net (charge-offs) recoveries and average portfolio loans (2,267) $ 7,759,472 0.03 % Provision for loan losses 2,399 ACL balance, December 31, 2023 91,740 Day 1 PCD 1 1,243 Net (charge-offs) recoveries and average portfolio loans by lending activity: C&I and other commercial (14,946) $ 1,892,293 0.79 % CRE (3,168) 3,361,644 0.09 % Real estate construction 67 416,439 (0.02) % Retail real estate 348 1,714,681 (0.02) % Retail other (470) 419,572 0.11 % Net (charge-offs) recoveries and average portfolio loans (18,169) $ 7,804,629 0.23 % Provision for loan losses 8,590 ACL balance, December 31, 2024 83,404 Day 1 PCD 1 100,783 Day 2 Provision for loan losses 2 42,433 Net (charge-offs) recoveries and average portfolio loans by lending activity: C&I and other commercial (41,862) $ 4,039,572 1.04 % CRE (12,342) 5,161,370 0.24 % Real estate construction 95 940,845 (0.01) % Retail real estate (750) 2,127,351 0.04 % Retail other (1,051) 487,799 0.22 % Net (charge-offs) recoveries and average portfolio loans (55,910) $ 12,756,937 0.44 % Provision for loan losses 3,313 ACL balance, December 31, 2025 $ 174,023 ___________________________________________ 1.
MD&A Non-performing assets, which includes non-performing loans, OREO, and other repossessed assets, increased by 193.41% to $23.3 million as of December 31, 2024, compared to $7.9 million as of December 31, 2023. Non-performing assets represented 0.19% of total assets as of December 31, 2024, compared to 0.06% as of December 31, 2023.
MD&A Non-performing assets, which include non-performing loans, OREO, and other repossessed assets, increased to $58.1 million as of December 31, 2025, compared to $23.3 million as of December 31, 2024. Non-performing assets represented 0.32% of total assets as of December 31, 2025, compared to 0.19% as of December 31, 2024.
Loans may be placed on non-accrual status regardless of whether or not such loans are considered past due. Loans are returned to accrual status when all principal and interest amounts contractually due are brought current and future payments are reasonably assured. Typically, loans are secured by collateral.
Loans are returned to accrual status when all principal and interest amounts contractually due are brought current and future payments are reasonably assured. Typically, loans are secured by collateral.
Balances of these assets are dependent on Busey’s operating, investing, lending, and financing activities during any given period.
Balances of these assets are dependent on Busey’s operating, investing, lending, and financing activities during any given period. First Busey Corporation (BUSE) | 2025 — 85 Table of Contents Contents of Item 7.
Busey’s ACL provided coverage of 3.58 times its non-performing assets at December 31, 2024, down from 11.55 times its non-performing assets at December 31, 2023. Classified assets, which include non-performing assets and substandard loans, increased to $85.3 million as of December 31, 2024, compared to $72.3 million as of December 31, 2023.
Busey’s ACL was 2.99 times its non-performing assets as of December 31, 2025, compared to 3.58 times its non-performing assets as of December 31, 2024. Classified assets, which include non-performing assets and substandard loans, increased to $174.5 million as of December 31, 2025, compared to $85.3 million as of December 31, 2024.
Unrecognized losses are included in OCI and amortized into income over the contractual lives of the securities. An ACL balance will be established for debt securities held to maturity when applicable. No ACL was recorded for Busey’s portfolio of debt securities held to maturity as of December 31, 2024 or 2023.
Unrecognized losses related to securities that were transferred in 2022 are included in OCI, net of taxes, and amortized into income over the contractual lives of the securities. An ACL balance will be established for debt securities held to maturity when applicable.
As of December 31, 2024, the amortized cost of debt securities held to maturity was $826.6 million, and the fair value was $675.1 million. There were no gross unrecognized gains and $151.6 million of gross unrecognized losses.
No ACL was recorded for Busey’s portfolio of debt securities held to maturity as of December 31, 2025 or 2024. As of December 31, 2025, the amortized cost of debt securities held to maturity was $746.4 million, and the fair value was $626.0 million. There were no gross unrecognized gains and $120.4 million of gross unrecognized losses.
The Day 1 PCD is attributable to the M&M acquisition. First Busey Corporation (BUSE) | 2024 — 75 Table of Contents Contents of Item 7.
The Day 1 PCD was attributable to the M&M acquisition in 2024 and the CrossFirst acquisition in 2025. 2. The Day 2 Provision for loan losses was attributable to the CrossFirst acquisition. First Busey Corporation (BUSE) | 2025 — 80 Table of Contents Contents of Item 7.
Provision expenses (releases) were recorded as follows for each of the years indicated (dollars in thousands) : Years Ended December 31, 2024 2023 2022 Provision for credit losses $ 8,590 $ 2,399 $ 4,623 First Busey Corporation (BUSE) | 2024 — 74 Table of Contents Contents of Item 7.
Provision expenses for loan losses were recorded as follows for each of the years indicated: Years Ended December 31, (dollars in thousands) Location 2025 2024 2023 Provision for loan losses 1 Provision for credit losses $ 45,746 $ 8,590 $ 2,399 ___________________________________________ 1.
Cash flows of the borrower, however, may not perform consistently with historical or projected information. Further, collateral securing loans may fluctuate in value due to individual economic or other factors. Busey Bank has established minimum standards and underwriting guidelines for all C&I and other commercial loan types.
C&I and other commercial loans are made based primarily on the borrower’s historical and projected cash flows and secondarily on the underlying assets pledged as collateral by the borrower. Cash flows of the borrower, however, may not perform consistently with historical or projected information. Further, collateral securing loans may fluctuate in value due to individual economic or other factors.
For a reconciliation of non-GAAP measures to the most directly comparable GAAP financial measures, see “ Item 1. Business—Non-GAAP Financial Information ” included in this Annual Report. First Busey Corporation (BUSE) | 2024 — 79 Table of Contents Contents of Item 7.
Business—Non-GAAP Financial Information ” included in this Annual Report. First Busey Corporation (BUSE) | 2025 — 84 Table of Contents Contents of Item 7.
Average liquid assets are summarized in the table below (dollars in thousands) : Years Ended December 31, 2024 2023 2022 Average liquid assets Cash and due from banks $ 109,400 $ 116,530 $ 120,910 Interest-bearing bank deposits 445,881 214,422 290,875 Total average liquid assets $ 555,281 $ 330,952 $ 411,785 Average liquid assets as a percent of average total assets 4.6 % 2.7 % 3.3 % Cash and unencumbered securities on Busey’s Consolidated Balance Sheets are summarized as follows for the periods presented (dollars in thousands) : As of December 31, 2024 2023 Cash and unencumbered securities Total cash and cash equivalents $ 697,659 $ 719,581 Debt securities available for sale 1,810,221 2,087,571 Debt securities available for sale pledged as collateral (653,454) (649,769) Cash and unencumbered securities $ 1,854,426 $ 2,157,383 Busey’s primary sources of funds consist of deposits, investment maturities and sales, loan principal repayments, and capital funds.
MD&A Average liquid assets are summarized in the table below: Years Ended December 31, (dollars in thousands) 2025 2024 2023 Average liquid assets Cash and due from banks $ 166,511 $ 109,400 $ 116,530 Interest-bearing bank deposits 575,781 445,881 214,422 Less: Restricted and pledged cash and bank deposits (86,844) (38,057) (35,806) Total average liquid assets $ 655,448 $ 517,224 $ 295,146 Average liquid assets as a percent of average total assets 3.7 % 4.3 % 2.4 % Cash and unencumbered securities on Busey’s Consolidated Balance Sheets are summarized as follows: As of December 31, (dollars in thousands) 2025 2024 Unencumbered cash and securities Total cash and cash equivalents $ 294,052 $ 697,659 Restricted and pledged cash and bank deposits (96,102) (65,830) Debt securities available for sale 2,162,548 1,810,221 Debt securities available for sale pledged as collateral (562,566) (653,454) Cash and unencumbered securities $ 1,797,932 $ 1,788,596 Busey’s primary sources of funds consist of deposits, investment maturities and sales, loan principal repayments, and capital funds.
First Busey Corporation (BUSE) | 2024 — 85 Table of Contents Contents of Item 7. MD&A Capital Resources Busey’s capital ratios are in excess of those required to be considered “well-capitalized” pursuant to applicable regulatory guidelines. The Federal Reserve uses capital adequacy guidelines in its examination and regulation of bank holding companies and their subsidiary banks.
Capital Resources Busey’s capital ratios are in excess of those required to be considered “well-capitalized” pursuant to applicable regulatory guidelines. The Federal Reserve uses capital adequacy guidelines in its examination and regulation of bank holding companies and their subsidiary banks. Risk-based capital ratios are established by allocating assets and certain off-balance-sheet commitments into risk-weighted categories.
Loans originated outside of these areas are generally to existing customers of Busey Bank. Busey attempts to utilize government-assisted lending programs, such as the SBA and U.S. Department of Agriculture lending programs, when prudent. Generally, loans are collateralized by assets, primarily real estate, and guaranteed by individuals.
While not specifically limited, Busey attempts to focus its lending on short to intermediate-term loans (0-10 years) in states where Busey maintains lending offices. Busey attempts to utilize government-assisted lending programs, such as the SBA and U.S. Department of Agriculture lending programs, when prudent. Generally, loans are collateralized by assets, primarily real estate, and guaranteed by individuals.
First Busey Corporation (BUSE) | 2024 — 69 Table of Contents Contents of Item 7. MD&A Commercial Real Estate Loans The commercial environment, along with the academic presence in some of the markets in which Busey operates, provides for the majority of Busey’s commercial lending opportunities to be CRE related, including multi-unit housing.
Busey Bank has established minimum standards and underwriting guidelines for all C&I and other commercial loan types. Commercial Real Estate Loans The commercial environment, along with the academic presence in some of the markets in which Busey operates, provides for the majority of Busey’s commercial lending opportunities to be CRE related, including multi-unit housing.
MD&A FINANCIAL CONDITION Balance Sheet Changes in significant items included on Busey’s Consolidated Balance Sheets are summarized in the table below (dollars in thousands) : As of December 31, 2024 2023 Change % Change Assets Debt securities available for sale $ 1,810,221 $ 2,087,571 $ (277,350) (13.3) % Debt securities held to maturity 826,630 872,628 (45,998) (5.3) % Portfolio loans, net of ACL 7,613,683 7,559,294 54,389 0.7 % Total assets 12,046,722 12,283,415 (236,693) (1.9) % Liabilities Deposits: Noninterest-bearing 2,719,907 2,834,655 (114,748) (4.0) % Interest-bearing 7,262,583 7,456,501 (193,918) (2.6) % Total deposits 9,982,490 10,291,156 (308,666) (3.0) % Securities sold under agreements to repurchase 155,610 187,396 (31,786) (17.0) % Subordinated notes, net of unamortized issuance costs 227,723 222,882 4,841 2.2 % Total liabilities 10,663,453 11,011,434 (347,981) (3.2) % Stockholders’ equity 1,383,269 1,271,981 111,288 8.7 % Investment Securities The primary purposes of Busey’s investment securities portfolio are to provide a source of earnings by deploying funds that are not needed to fulfill loan demand, deposit redemptions, or other liquidity purposes; to serve as a tool for interest rate risk positioning; and to provide collateral for pledging purposes against public deposits and repurchase agreements, all while providing a source of liquidity.
FINANCIAL CONDITION Balance Sheet Changes in significant items included on Busey’s Consolidated Balance Sheets are summarized in the table below: As of December 31, (dollars in thousands) 2025 2024 Change % Change Assets Debt securities available for sale $ 2,162,548 $ 1,810,221 $ 352,327 19.5 % Debt securities held to maturity 746,385 826,630 (80,245) (9.7) % Portfolio loans, net of ACL 13,393,776 7,613,683 5,780,093 75.9 % Total assets 18,104,736 12,046,722 6,058,014 50.3 % Liabilities Deposits: Noninterest-bearing 3,659,421 2,719,907 939,514 34.5 % Interest-bearing 11,246,537 7,262,583 3,983,954 54.9 % Total deposits 14,905,958 9,982,490 4,923,468 49.3 % Securities sold under agreements to repurchase 166,929 155,610 11,319 7.3 % Long-term borrowings 113,806 — 113,806 100.0 % Subordinated notes, net of unamortized issuance costs 99,395 227,723 (128,328) (56.4) % Total liabilities 15,635,754 10,663,453 4,972,301 46.6 % Stockholders’ equity 2,468,982 1,383,269 1,085,713 78.5 % Investment Securities The primary purposes of Busey’s investment securities portfolio are to provide a source of earnings by deploying funds that are not needed to fulfill loan demand, deposit redemptions, or other liquidity purposes; to serve as a tool for interest rate risk positioning; and to provide collateral for pledging purposes against public deposits and repurchase agreements, all while providing a source of liquidity.
Treasury securities $ — $ 15,946 Obligations of U.S. government corporations and agencies 1,400 5,832 Obligations of states and political subdivisions 139,829 172,845 Asset-backed securities 336,557 468,223 Commercial mortgage-backed securities 92,174 103,509 Residential mortgage-backed securities 1,087,210 1,111,312 Corporate debt securities 153,051 209,904 Debt securities available for sale, fair value $ 1,810,221 $ 2,087,571 Debt securities available for sale, amortized cost $ 2,039,952 $ 2,334,630 Fair value as a percentage of amortized cost 88.74 % 89.42 % First Busey Corporation (BUSE) | 2024 — 66 Table of Contents Contents of Item 7.
The composition of debt securities available for sale was as follows: As of December 31, (dollars in thousands) 2025 2024 Debt securities available for sale Obligations of U.S. government corporations and agencies $ 112,046 $ 1,400 Obligations of states and political subdivisions 263,873 139,829 Asset-backed securities 265,580 336,557 Commercial mortgage-backed securities 132,942 92,174 Residential mortgage-backed securities 1,344,416 1,087,210 Corporate debt securities 43,691 153,051 Debt securities available for sale, fair value $ 2,162,548 $ 1,810,221 Debt securities available for sale, amortized cost $ 2,300,845 $ 2,039,952 Fair value as a percentage of amortized cost 93.99 % 88.74 % First Busey Corporation (BUSE) | 2025 — 72 Table of Contents Contents of Item 7.
First Busey Corporation (BUSE) | 2024 — 83 Table of Contents Contents of Item 7. MD&A As of December 31, 2024, management believed that adequate liquidity existed to meet all projected cash flow obligations. Busey seeks to achieve a satisfactory degree of liquidity by actively managing both assets and liabilities.
As of December 31, 2025, management believed that adequate liquidity existed to meet all projected cash flow obligations. Busey seeks to achieve a satisfactory degree of liquidity by actively managing both assets and liabilities. Asset management guides the proportion of liquid assets to total assets, while liability management monitors future funding requirements and prices liabilities accordingly.
NEW ACCOUNTING PRONOUNCEMENTS Busey reviews new accounting standards as issued. Information relating to accounting pronouncements applicable to Busey appears in “ Note 1. Significant Accounting Policies ” in the Notes to the Consolidated Financial Statements. EFFECTS OF INFLATION The effect of inflation on a financial institution differs significantly from the effect on an industrial company.
For further discussion of capital resources and requirements, see “ Note 12. Regulatory Capital .” NEW ACCOUNTING PRONOUNCEMENTS Busey reviews new accounting standards as issued. Information relating to accounting pronouncements applicable to Busey appears in “ Note 1. Significant Accounting Policies ” in the Notes to Consolidated Financial Statements .
Pledged securities totaled $871.4 million, or 33.0% of total debt securities, as of December 31, 2024, and $837.4 million, or 28.3% of total debt securities, as of December 31, 2023. Debt Securities Available for Sale Debt securities available for sale are carried at fair value. Net unrealized gains or losses, net of tax, are recorded in stockholders’ equity, through AOCI.
MD&A Debt Securities Available for Sale Debt securities available for sale are carried at fair value. Net unrealized gains or losses, net of tax, are recorded in stockholders’ equity, through AOCI. As of December 31, 2025, the fair value of debt securities available for sale was $2.16 billion, and the amortized cost was $2.30 billion.
In addition, the loan review department reviews risk assessments made by Busey’s credit department, lenders, and loan committees. Results of these reviews are presented to management and the audit committee at least quarterly. Busey Bank’s lending can be summarized into five primary lending activities, which can be further categorized as either commercial or retail lending.
In addition, the loan review department reviews risk assessments made by Busey’s credit department, lenders, and loan committees. Results of these reviews are presented to management and the audit committee at least quarterly. First Busey Corporation (BUSE) | 2025 — 74 Table of Contents Contents of Item 7.
The balance of commitments to extend credit represents future cash requirements and some of these commitments may expire without being drawn upon.
Off-Balance-Sheet Arrangements Busey Bank routinely enters into commitments to extend credit and standby letters of credit in the normal course of business to meet the financing needs of its customers. The balance of commitments to extend credit represents future cash requirements and some of these commitments may expire without being drawn upon.
The portion of Busey’s deposit base that was uninsured and not otherwise collateralized was estimated to be $2.96 billion at December 31, 2024, which represented 30% of total deposits. Of that amount, $286.4 million represented time deposits.
Excluding intercompany accounts, fully collateralized accounts (including preferred deposits), and pass-through accounts where clients have deposit insurance at the correspondent financial institution, the portion of Busey’s deposit base that was uninsured and not otherwise collateralized was estimated to be $5.58 billion, or 37% of total deposits, at December 31, 2025. Of that amount, $759.4 million represented time deposits.
As of December 31, 2024 2023 Commercial loans C&I and other commercial 24.8 % 24.0 % CRE 42.5 % 43.6 % Real estate construction 4.9 % 6.0 % Total commercial loans 72.2 % 73.6 % Retail loans Retail real estate 22.0 % 22.5 % Retail other 5.8 % 3.9 % Total retail loans 27.8 % 26.4 % Total portfolio loans 100.0 % 100.0 % First Busey Corporation (BUSE) | 2024 — 71 Table of Contents Contents of Item 7.
As of December 31, 2025 2024 Commercial loans C&I and other commercial 31.2 % 24.8 % CRE 40.9 % 42.5 % Real estate construction 7.6 % 4.9 % Total commercial loans 79.7 % 72.2 % Retail loans Retail real estate 15.9 % 22.0 % Retail other 4.4 % 5.8 % Total retail loans 20.3 % 27.8 % Total portfolio loans 100.0 % 100.0 % Busey Bank originates loans across its regional operating model and through its specialty product lines, as described below: • East – Suburban Chicago markets, the St.
The following table summarizes Busey’s outstanding commitments and reserves for unfunded commitments (dollars in thousands) : As of December 31, 2024 2023 Outstanding loan commitments and standby letters of credit $ 2,548,178 $ 2,176,496 Reserve for unfunded commitments 5,967 7,062 The following table summarizes Busey’s provision for unfunded commitments expenses (releases) for the periods presented (dollars in thousands) : Years Ended December 31, Location 2024 2023 2022 Provision for unfunded commitments expense (release) Other noninterest expense $ (1,095) $ 461 $ 61 Busey anticipates that it will have sufficient funds available to meet current loan commitments, including loan applications received and in process prior to the issuance of firm commitments.
MD&A The following table summarizes Busey’s outstanding commitments and reserves for unfunded commitments : As of December 31, (dollars in thousands) 2025 2024 Outstanding loan commitments and standby letters of credit $ 4,820,613 $ 2,548,178 Reserve for unfunded commitments 12,964 5,967 The following table summarizes Busey’s provision for unfunded commitments for the periods presented: Years Ended December 31, (dollars in thousands) Location 2025 2024 2023 Provision for unfunded commitments 1 Provision for credit losses $ 6,997 $ (1,095) $ 461 ___________________________________________ 1.
Deposits are federally insured up to the FDIC insurance limit of $250,000. When a portion of a deposit account exceeds the FDIC insurance limit, that portion is uninsured. Estimated uninsured deposits were $3.78 billion at December 31, 2024.
Core deposits include non-brokered transaction accounts, money market and savings deposit accounts, and time deposits of $250,000 or less. Core deposits represented 93.7% of total deposits as of December 31, 2025. Deposits are federally insured up to the FDIC insurance limit of $250,000. When a portion of a deposit account exceeds the FDIC insurance limit, that portion is uninsured.
Concentration of Credit Risk As a matter of policy and practice, Busey limits the level of concentration exposure in any particular loan segment with the goal of maintaining a well-diversified loan portfolio. The following table presents the percentage of total portfolio loans for each lending activity.
Busey remains steadfast in its conservative approach to underwriting and disciplined approach to pricing. During 2025, Busey experienced elevated payoffs that outpaced new production momentums. Concentration of Credit Risk As a matter of policy and practice, Busey limits the level of concentration exposure in any particular loan segment with the goal of maintaining a well-diversified loan portfolio.
The following table presents estimates of the uninsured portion of time deposits by maturity date (dollars in thousands) : As of December 31, 2024 Estimated uninsured time deposits by schedule of maturities 3 months or less $ 107,163 Over 3 months through 6 months 86,546 Over 6 months through 12 months 84,104 Thereafter 8,615 Uninsured time deposits $ 286,428 4 Core deposits is a non-GAAP financial measure.
The following table presents estimates of the uninsured portion of time deposits by maturity date: (dollars in thousands) As of December 31, 2025 Estimated uninsured time deposits by schedule of maturities 3 months or less $ 193,879 Over 3 months through 6 months 467,812 Over 6 months through 12 months 82,469 Thereafter 15,195 Uninsured time deposits $ 759,355 Additional information about Busey’s deposits is located in “ Note 9.
The composition of debt securities held to maturity was as follows (dollars in thousands) : As of December 31, 2024 2023 Debt securities held to maturity Commercial mortgage-backed securities $ 415,530 $ 428,526 Residential mortgage-backed securities 411,100 444,102 Debt securities held to maturity, amortized cost $ 826,630 $ 872,628 Debt securities held to maturity, fair value $ 675,053 $ 730,397 Fair value as a percentage of amortized cost 81.66 % 83.70 % By maturity date, fair values and weighted average yields of debt securities held to maturity as of December 31, 2024, are presented in the following table (dollars in thousands) : Due in 1 year or less Due after 1 year through 5 years Due after 5 years through 10 years Due after 10 years Fair Value Weighted Average Yield Fair Value Weighted Average Yield Fair Value Weighted Average Yield Fair Value Weighted Average Yield Debt securities held to maturity 1 Commercial mortgage-backed securities $ 18,327 2.27 % $ 58,733 2.15 % $ 12,609 2.42 % $ 248,619 2.20 % Residential mortgage-backed securities — — — — — — 336,765 2.20 % Debt securities held to maturity $ 18,327 2.27 % $ 58,733 2.15 % $ 12,609 2.42 % $ 585,384 2.20 % ___________________________________________ 1.
MD&A By maturity date, fair values and weighted average yields of debt securities held to maturity as of December 31, 2025, are presented in the following table: Due in 1 year or less Due after 1 year through 5 years Due after 5 years through 10 years Due after 10 years (dollars in thousands) Fair Value Weighted Average Yield Fair Value Weighted Average Yield Fair Value Weighted Average Yield Fair Value Weighted Average Yield Debt securities held to maturity 1 Commercial mortgage-backed securities $ 19,896 2.15 % $ 35,836 2.18 % $ — — % $ 246,883 2.12 % Residential mortgage-backed securities — — % — — % — — % 323,342 2.22 % Debt securities held to maturity $ 19,896 2.15 % $ 35,836 2.18 % $ — — % $ 570,225 2.18 % ___________________________________________ 1.
C&I and other commercial loans will generally be guaranteed, in full or a material percentage, by the primary owners of the business. C&I and other commercial loans are made based primarily on the borrower’s historical and projected cash flows and secondarily on the underlying assets pledged as collateral by the borrower.
C&I and Other Commercial Loans C&I and other commercial loans typically comprise working capital loans or business expansion loans, including loans for asset purchases and other business loans. C&I and other commercial loans will generally be guaranteed, in full or a material percentage, by the primary owners of the business.
Increases in net charge-offs during the year ended December 31, 2024, were significantly attributable to a single C&I credit relationship and the CRE loan relationship mentioned above. Asset quality metrics remain dependent upon market-specific economic conditions, and specific measures may fluctuate from period to period.
Net charge-offs for the year ended December 31, 2025, included $36.2 million related to PCD loans. Asset quality metrics remain dependent upon market-specific economic conditions, and specific measures may fluctuate from period to period. If economic conditions were to deteriorate, Busey would expect the credit quality of its loan portfolio to decline and loan defaults to increase.
MD&A The following table sets forth information concerning non-performing loans and performing restructured loans (dollars in thousands) : As of December 31, 2024 2023 Change % Change Portfolio loans $ 7,697,087 $ 7,651,034 $ 46,053 0.6 % Loans 30 – 89 days past due 8,124 5,779 2,345 40.6 % Total assets 12,046,722 12,283,415 (236,693) (1.9) % Non-performing assets Non-performing loans: Non-accrual loans $ 22,088 $ 7,441 $ 14,647 196.8 % Loans 90+ days past due and still accruing 1,149 375 774 206.4 % Total non-performing loans 23,237 7,816 15,421 197.3 % OREO and other repossessed assets 63 125 (62) (49.6) % Total non-performing assets 23,300 7,941 15,359 193.4 % Substandard (excludes 90+ days past due) 62,023 64,347 (2,324) (3.6) % Classified assets $ 85,323 $ 72,288 $ 13,035 18.0 % ACL $ 83,404 $ 91,740 (8,336) (9.1) % Bank Tier 1 Capital 1,438,296 1,362,962 75,334 5.5 % Ratios ACL to portfolio loans 1.08 % 1.20 % (12) bps ACL to non-accrual loans 3.78 x 12.33 x (8.55) x ACL to non-performing loans 3.59 x 11.74 x (8.15) x ACL to non-performing assets 3.58 x 11.55 x (7.97) x Non-accrual loans to portfolio loans 0.29 % 0.10 % 19 bps Non-performing loans to portfolio loans 0.30 % 0.10 % 20 bps Non-performing assets to total assets 0.19 % 0.06 % 13 bps Non-performing assets to portfolio loans and OREO and other repossessed assets 0.30 % 0.10 % 20 bps Classified assets to Bank Tier 1 Capital and ACL 5.61 % 4.97 % 64 bps Asset quality remains strong by both Busey’s historical and current industry trends, and Busey’s operating mandate and focus have been on emphasizing credit quality over asset growth.
MD&A The following table sets forth information concerning non-performing assets and asset quality ratios: As of December 31, (dollars in thousands) 2025 2024 Change % Change Total assets $ 18,104,736 $ 12,046,722 $ 6,058,014 50.3 % Portfolio loans 13,567,799 7,697,087 5,870,712 76.3 % Loans 30 – 89 days past due 16,475 8,124 8,351 102.8 % Non-performing assets Non-performing loans: Non-accrual loans $ 51,198 $ 22,088 $ 29,110 131.8 % Loans 90+ days past due and still accruing 2,288 1,149 1,139 99.1 % Total non-performing loans 53,486 23,237 30,249 130.2 % OREO and other repossessed assets 4,626 63 4,563 NM Total non-performing assets 58,112 23,300 34,812 149.4 % Substandard (excludes 90+ days past due) 116,402 62,023 54,379 87.7 % Classified assets $ 174,514 $ 85,323 $ 89,191 104.5 % ACL $ 174,023 $ 83,404 $ 90,619 108.7 % Bank Tier 1 Capital 2,150,048 1,438,296 711,752 49.5 % Ratios ACL to portfolio loans 1.28 % 1.08 % 20 bps ACL to non-accrual loans 3.40 x 3.78 x (0.38) x ACL to non-performing loans 3.25 x 3.59 x (0.34) x ACL to non-performing assets 2.99 x 3.58 x (0.58) x Non-accrual loans to portfolio loans 0.38 % 0.29 % 9 bps Non-performing loans to portfolio loans 0.39 % 0.30 % 9 bps Non-performing assets to total assets 0.32 % 0.19 % 13 bps Non-performing assets to portfolio loans and OREO and other repossessed assets 0.43 % 0.30 % 13 bps Classified assets to Bank Tier 1 Capital and ACL 7.51 % 5.61 % 190 bps Busey’s total assets grew by 50.3% to $18.10 billion as of December 31, 2025, compared to $12.05 billion as of December 31, 2024, largely in connection with the CrossFirst acquisition.
MD&A Portfolio Composition The composition of Busey’s loan portfolio as of the dates indicated, as well as changes in portfolio loan balances, were as follows (dollars in thousands) : As of December 31, 2024 2023 Change % Change Commercial loans C&I and other commercial $ 1,904,515 $ 1,835,994 $ 68,521 3.7 % CRE 3,269,564 3,337,337 (67,773) (2.0) % Real estate construction 378,209 461,717 (83,508) (18.1) % Total commercial loans 5,552,288 5,635,048 (82,760) (1.5) % Retail loans Retail real estate 1,696,457 1,720,455 (23,998) (1.4) % Retail other 448,342 295,531 152,811 51.7 % Total retail loans 2,144,799 2,015,986 128,813 6.4 % Total portfolio loans 7,697,087 7,651,034 46,053 0.6 % ACL (83,404) (91,740) 8,336 9.1 % Portfolio loans, net of ACL $ 7,613,683 $ 7,559,294 $ 54,389 0.7 % Portfolio loan growth in 2024 was due to the M&M acquisition.
MD&A Portfolio Composition The composition of Busey’s loan portfolio as of the dates indicated, as well as changes in portfolio loan balances, were as follows: As of December 31, (dollars in thousands) 2025 2024 Change % Change Commercial loans C&I and other commercial $ 4,229,208 $ 1,904,515 $ 2,324,693 122.1 % CRE 5,550,018 3,269,564 2,280,454 69.7 % Real estate construction 1,039,289 378,209 661,080 174.8 % Total commercial loans 10,818,515 5,552,288 5,266,227 94.8 % Retail loans Retail real estate 2,154,616 1,696,457 458,159 27.0 % Retail other 594,668 448,342 146,326 32.6 % Total retail loans 2,749,284 2,144,799 604,485 28.2 % Total portfolio loans 13,567,799 7,697,087 5,870,712 76.3 % ACL (174,023) (83,404) (90,619) 108.7 % Portfolio loans, net $ 13,393,776 $ 7,613,683 $ 5,780,093 75.9 % Portfolio loan growth in 2025 was primarily attributable to the CrossFirst acquisition.
MD&A CRE loans made up 42.5% of Busey’s total loan portfolio as of December 31, 2024, and were 27.9% owner occupied. CRE loans are made across a variety of industries, as depicted in the table below (dollars in thousands) .
As of December 31, (dollars in thousands) 2025 2024 COMMERCIAL REAL ESTATE LOANS Non-owner occupied commercial real estate $ 4,118,361 74.2 % $ 2,360,273 72.2 % Owner-occupied commercial real estate 1,431,657 25.8 % 909,291 27.8 % Total commercial real estate loans $ 5,550,018 100.0 % $ 3,269,564 100.0 % CRE loans are made across a variety of industries, as depicted in the table below.
MD&A By maturity date, fair values and weighted average yields of debt securities available for sale as of December 31, 2024, are presented in the following table (dollars in thousands) : Due in 1 year or less Due after 1 year through 5 years Due after 5 years through 10 years Due after 10 years Fair Value Weighted Average Yield Fair Value Weighted Average Yield Fair Value Weighted Average Yield Fair Value Weighted Average Yield Debt securities available for sale 1 Obligations of U.S. government corporations and agencies $ 160 2.65 % $ 1,240 5.03 % $ — — $ — — Obligations of states and political subdivisions 2 12,341 3.49 % 40,593 2.42 % 72,066 2.47 % 14,829 2.76 % Asset-backed securities — — 473 5.95 % 304,995 6.15 % 31,089 6.11 % Commercial mortgage-backed securities 5,966 2.87 % 4,233 2.92 % 34,094 2.34 % 47,881 2.44 % Residential mortgage-backed securities 222 2.89 % 6,621 4.24 % 54,289 1.97 % 1,026,078 2.14 % Corporate debt securities 71,717 1.31 % 51,754 2.16 % 29,580 3.72 % — — % Debt securities available for sale $ 90,406 1.72 % $ 104,914 2.47 % $ 495,024 4.75 % $ 1,119,877 2.27 % ___________________________________________ 1.
MD&A By maturity date, fair values and weighted average yields of debt securities available for sale as of December 31, 2025, are presented in the following table: Due in 1 year or less Due after 1 year through 5 years Due after 5 years through 10 years Due after 10 years (dollars in thousands) Fair Value Weighted Average Yield Fair Value Weighted Average Yield Fair Value Weighted Average Yield Fair Value Weighted Average Yield Debt securities available for sale 1 Obligations of U.S. government corporations and agencies $ — — % $ 82 5.18 % $ — — % $ 111,964 4.95 % Obligations of states and political subdivisions 2 5,889 3.70 % 42,361 2.55 % 75,654 3.08 % 139,969 5.65 % Asset-backed securities — — % — — % 120,990 5.37 % 144,590 5.27 % Commercial mortgage-backed securities 1,612 2.75 % 2,618 3.02 % 58,612 3.31 % 70,100 3.44 % Residential mortgage-backed securities 53 2.87 % 2,908 3.91 % 75,297 2.16 % 1,266,158 3.09 % Corporate debt securities 3,130 2.61 % 15,366 4.30 % 25,195 4.20 % — — % Debt securities available for sale $ 10,684 3.23 % $ 63,335 3.06 % $ 355,748 3.78 % $ 1,732,781 3.61 % ___________________________________________ 1.
Commercial lending activities consist of C&I and other commercial loans, CRE loans, and real estate construction loans while retail lending activities consist of retail real estate loans and retail other loans. C&I and Other Commercial Loans C&I and other commercial loans typically comprise working capital loans or business expansion loans, including loans for asset purchases and other business loans.
MD&A Busey Bank’s lending can be summarized into five primary lending activities, which can be further categorized as either commercial or retail lending. Commercial lending activities consist of C&I and other commercial loans, CRE loans, and real estate construction loans while retail lending activities consist of retail real estate loans and retail other loans.
Busey continues to monitor evolving federal and state tax legislation and its potential impact on operations on an ongoing basis. As of December 31, 2024, Busey Bank is under examination by the Florida Department of Revenue for its 2020 to 2022 corporate income tax filings.
As of December 31, 2025, Busey remains under examination by the Illinois Department of Revenue for Merchant & Manufacturers Bank's tax filings for the tax years ended December 31, 2022 and 2023. The Florida Department of Revenue examination of Busey Bank's tax years 2020 to 2022 corporate income tax filings was completed with no additional income tax assessments.
This loan carries a remaining balance of $15.0 million following a $3.0 million charge-off in the fourth quarter of 2024. Non-performing loans represented 0.30% of portfolio loans as of December 31, 2024, compared to 0.10% as of December 31, 2023.
Non-performing loan balances increased to $53.5 million as of December 31, 2025, compared to $23.2 million as of December 31, 2024, primarily due to PCD loans assumed in the CrossFirst acquisition. Non-performing loans represented 0.39% of portfolio loans as of December 31, 2025, compared to 0.30% as of December 31, 2024.
MD&A The following table summarizes significant contractual obligations and other commitments, excluding, when applicable, short-term borrowings and the current portion of long-term debt, as of December 31, 2024, (dollars in thousands) : Certificates of Deposit Operating Leases Junior Subordinated Debt Owed to Unconsolidated Trusts Long-term Debt Subordinated Notes, Net of Unamortized Issuance Costs Total Contractual obligations by schedule of maturities 2025 $ 1,427,748 $ 2,082 $ — $ — $ — $ 1,429,830 2026 33,459 1,774 — — — 35,233 2027 14,964 1,558 — — — 16,522 2028 8,178 1,495 — — — 9,673 2029 5,838 1,505 — — — 7,343 Thereafter 448 4,376 74,815 — 227,723 307,362 Contractual obligations $ 1,490,635 $ 12,790 $ 74,815 $ — $ 227,723 $ 1,805,963 Commitments to extend credit and standby letters of credit $ 2,548,178 Cash Flows Busey’s cash flows consist of operating activities, investing activities, and financing activities.
The following table summarizes significant contractual obligations and other commitments, excluding, when applicable, short-term borrowings and the current portion of long-term borrowings, as of December 31, 2025: (dollars in thousands) Time deposits Long-term Borrowings Subordinated Notes, Net of Unamortized Issuance Costs Junior Subordinated Debt Owed to Unconsolidated Trusts Operating Leases in Other Liabilities Total Contractual obligations 1 2026 $ 2,364,343 $ 3,234 $ 5,000 $ 4,813 $ 6,255 $ 2,382,960 2027 46,913 60,290 5,000 4,813 5,929 122,215 2028 10,952 48,865 5,000 4,813 5,406 74,284 2029 4,593 762 5,000 4,813 4,407 18,813 2030 2,667 757 5,000 4,813 3,505 15,985 Thereafter 422 9,919 107,389 101,411 12,690 221,912 Contractual obligations $ 2,429,890 $ 123,827 $ 132,389 $ 125,476 $ 38,192 $ 2,849,774 Commitments to extend credit and standby letters of credit $ 4,820,613 ___________________________________________ 1.
MD&A Deposits The following table shows the deposit mix for each of the periods presented (dollars in thousands) : As of December 31, 2024 2023 Balance % Total Balance % Total Change % Change Deposits Non-maturity deposits: Noninterest-bearing demand deposits $ 2,719,907 27.3 % $ 2,834,655 27.5 % $ (114,748) (4.0) % Interest-bearing transaction deposits 2,423,237 24.3 % 2,717,139 26.4 % (293,902) (10.8) % Saving deposits and money market deposits 3,348,711 33.5 % 2,920,088 28.4 % 428,623 14.7 % Total non-maturity deposits 8,491,855 85.1 % 8,471,882 82.3 % 19,973 0.2 % Time deposits 1,490,635 14.9 % 1,819,274 17.7 % (328,639) (18.1) % Total deposits $ 9,982,490 100.0 % $ 10,291,156 100.0 % $ (308,666) (3.0) % Total deposits decreased by 3.0% to $9.98 billion as of December 31, 2024, compared to $10.29 billion as of December 31, 2023.
Deposits The following table presents the composition of, and changes in, Busey’s deposits: As of December 31, 2025 2024 (dollars in thousands) Balance % Total Balance % Total Change % Change Deposits Non-maturity deposits: Noninterest-bearing demand deposits $ 3,659,421 24.6 % $ 2,719,907 27.3 % $ 939,514 34.5 % Interest-bearing transaction deposits 3,119,475 20.9 % 2,423,237 24.3 % 696,238 28.7 % Saving deposits and money market deposits 5,697,172 38.2 % 3,348,711 33.5 % 2,348,461 70.1 % Total non-maturity deposits 12,476,068 83.7 % 8,491,855 85.1 % 3,984,213 46.9 % Time deposits 2,429,890 16.3 % 1,490,635 14.9 % 939,255 63.0 % Total deposits $ 14,905,958 100.0 % $ 9,982,490 100.0 % $ 4,923,468 49.3 % First Busey Corporation (BUSE) | 2025 — 83 Table of Contents Contents of Item 7.
Busey Bank paid dividends to First Busey Corporation totaling $100.0 million and $90.0 million for the years ended December 31, 2024, and 2023, respectively. Off-Balance-Sheet Arrangements Busey Bank routinely enters into commitments to extend credit and standby letters of credit in the normal course of business to meet the financing needs of its customers.
Busey’s ability to pay cash dividends to its stockholders and to service its debt is dependent on the receipt of cash dividends from its subsidiaries. Busey Bank paid dividends to First Busey Corporation totaling $160.0 million and $100.0 million for the years ended December 31, 2025, and 2024, respectively.
As of December 31, 2024, the fair value of debt securities available for sale was $1.81 billion, and the amortized cost was $2.04 billion. There were $0.6 million of gross unrealized gains and $230.3 million of gross unrealized losses, resulting in a net unrealized loss of $229.7 million.
There were $13.9 million of gross unrealized gains and $152.2 million of gross unrealized losses, resulting in a net unrealized loss of $138.3 million.
First Busey Corporation (BUSE) | 2024 — 65 Table of Contents Contents of Item 7. MD&A The composition of debt securities available for sale was as follows (dollars in thousands) : As of December 31, 2024 2023 Debt securities available for sale U.S.
The composition of debt securities held to maturity was as follows: As of December 31, (dollars in thousands) 2025 2024 Debt securities held to maturity Commercial mortgage-backed securities $ 367,825 $ 415,530 Residential mortgage-backed securities 378,560 411,100 Debt securities held to maturity, amortized cost $ 746,385 $ 826,630 Debt securities held to maturity, fair value $ 625,957 $ 675,053 Fair value as a percentage of amortized cost 83.87 % 81.66 % First Busey Corporation (BUSE) | 2025 — 73 Table of Contents Contents of Item 7.
Removed
Item 1. Business—Non-GAAP Financial Information. ” First Busey Corporation (BUSE) | 2024 — 63 Table of Contents Contents of Item 7. MD&A Income Taxes Effective income tax rates, calculated by dividing income taxes by income before taxes, were 25.8%, 20.4%, and 20.7% for the years ended December 31, 2024, 2023, and 2022, respectively.
Added
Item 1. Business—Non-GAAP Financial Information. ” First Busey Corporation (BUSE) | 2025 — 70 Table of Contents Contents of Item 7. MD&A Busey continues to monitor evolving federal and state tax legislation and its potential impact on operations on an ongoing basis.
Removed
Busey’s effective tax rates increased in 2024 due to the adoption of ASU 2023-02 in January 2024, yet remained lower than the combined federal and state statutory rate of approximately 28.0% due to tax exempt interest income, such as municipal bond interest and bank owned life insurance income.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeDespite these efforts, credit risks cannot be entirely eliminated, and borrower defaults could lead to increased non-performing loans, charge-offs, delinquencies, and higher ACL provisions. Busey’s commercial loan portfolio reflects a strategic focus on maintaining robust credit quality. However, there are inherent risks in any lending activity, including uncertainties in collateral values, borrower cash flows, and broader economic conditions.
Biggest changeAdditionally, Busey leverages stress testing at both the borrower and portfolio levels to proactively identify potential vulnerabilities. Despite these efforts, credit risks cannot be eliminated, and increased borrower stress could lead to increased delinquencies, non-performing loans, higher ACL provisions, and charge-offs.
New or revised laws and regulations, including with the respect to the use of artificial intelligence by financial institutions and service providers, may significantly impact Busey’s current and planned privacy, data protection, and information security-related practices; the collection, use, retention, and safeguarding of customer and employee information; and current or planned business activities.
New or revised laws and regulations, including with respect to the use of artificial intelligence by financial institutions and service providers, may significantly impact Busey’s current and planned privacy, data protection, and information security-related practices; the collection, use, retention, and safeguarding of customer and employee information; and current or planned business activities.
The trading market for Busey’s common stock is significantly influenced by research and reports from industry analysts. Limited or negative analyst coverage could reduce the stock’s demand, market price, and trading volume. Downgrades, unfavorable comparisons with competitors, or operating results that fall short of analyst expectations may further negatively affect stock performance.
The trading market for Busey’s common stock is significantly influenced by research and reports from industry analysts. Limited or negative analyst coverage could reduce the stock’s demand, market price, and trading volume. Downgrades, unfavorable comparisons with competitors, or operating results that fall short of analyst’s expectations may further negatively affect stock performance.
To mitigate these risks, Busey has implemented robust cybersecurity protocols, regular system audits, and incident response plans. The use of artificial intelligence-powered tools, such as Verafin, provide additional layers of fraud detection, enabling proactive threat management. However, as cybersecurity threats evolve, the possibility of system penetration persists even with robust security protocols in place.
To mitigate these risks, Busey has implemented robust cybersecurity protocols, regular system audits, and incident response plans. The use of artificial intelligence-powered tools provide additional layers of fraud and threat detection, enabling proactive management. However, as cybersecurity threats evolve, the possibility of system penetration persists even with robust security protocols in place.
It is Busey Bank’s current practice to avoid knowingly providing banking products or services to entities or individuals that: (1) directly or indirectly manufacture, distribute, or dispense marijuana or hemp products, or those with a significant financial interest in such entities; or (2) derive a material amount of revenue from providing products or services to, or other involvement with, such entities.
Risk Factors It is Busey Bank’s current practice to avoid knowingly providing banking products or services to entities or individuals that: (1) directly or indirectly manufacture, distribute, or dispense marijuana or hemp products, or those with a significant financial interest in such entities; or (2) derive a material amount of revenue from providing products or services to, or other involvement with, such entities.
Risk Factors Busey is or may become involved from time to time in suits, legal proceedings, information-gathering requests, investigations, and proceedings by governmental and self-regulatory agencies that may lead to adverse consequences. Busey may be subject to lawsuits, governmental inquiries, or self-regulatory reviews. These proceedings could result in penalties, adverse judgments, or operational restrictions.
Busey is or may become involved from time to time in suits, legal proceedings, information-gathering requests, investigations, and proceedings by governmental and self-regulatory agencies that may lead to adverse consequences. Busey may be subject to lawsuits, governmental inquiries, or self-regulatory reviews. These proceedings could result in penalties, adverse judgments, or operational restrictions.
However, these advancements introduce vulnerabilities, including the risk of cyber-attacks and operational disruptions. The Federal Reserve’s November 2024 Financial Stability Report has emphasized growing threats posed by sophisticated cyber-attacks. These threats not only compromise data integrity but also pose significant reputational and financial risks.
However, these advancements introduce vulnerabilities, including the risk of cyber-attacks and operational disruptions. The Federal Reserve’s November 2025 Financial Stability Report has emphasized growing threats posed by sophisticated cyber-attacks. These threats not only compromise data integrity but also pose significant reputational and financial risks.
Fraudulent activities, such as identity theft, phishing, and unauthorized transactions, could result in financial losses, regulatory penalties, and erosion of customer trust. Busey employs a multi-layered approach to fraud prevention, including internal controls, insurance coverage, and advanced fraud detection tools, like Verafin.
Fraudulent activities, such as identity theft, phishing, and unauthorized transactions, could result in financial losses, regulatory penalties, and erosion of customer trust. Busey employs a multi-layered approach to fraud prevention, including internal controls, advanced fraud detection tools, and insurance coverage.
Risk Factors COMPETITIVE AND STRATEGIC RISKS If securities or industry analysts do not publish or cease publishing research reports about Busey, if they adversely change their recommendations regarding Busey’s stock, or if Busey’s operating results do not meet their expectations, the price of Busey’s stock could decline.
COMPETITIVE AND STRATEGIC RISKS If securities or industry analysts do not publish or cease publishing research reports about Busey, if they adversely change their recommendations regarding Busey’s stock, or if Busey’s operating results do not meet their expectations, the price of Busey’s stock could decline.
Compliance with current or future privacy, data protection, and information security laws could result in higher compliance and technology costs and could restrict Busey’s ability to provide certain products and services, which could adversely affect Busey’s business. Laws impacting cannabis-related businesses may have an impact on Busey’s operations and risk profile.
Compliance with current or future privacy, data protection, and information security laws could result in higher compliance and technology costs and could restrict Busey’s ability to provide certain products and services, which could materially and adversely affect Busey’s business, financial condition, and results of operations. Laws impacting cannabis-related businesses may have an impact on Busey’s operations and risk profile.
The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods prior to the expiration of the related net operating losses and may be limited by Section 382 of the Internal Revenue Code.
The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods prior to the expiration of the related net operating losses and may be limited by ownership change rules under Section 382 of the Internal Revenue Code.
While accruals are established for legal contingencies when losses are probable and estimable, outcomes may exceed these amounts, and accordingly, Busey’s ultimate losses may be higher, possibly significantly so, than the amounts accrued for legal loss contingencies, which could adversely affect Busey’s financial condition and results of operations. See “ Note 1 8 .
While accruals are established for legal contingencies when losses are probable and estimable, outcomes may exceed these amounts, and accordingly, Busey’s ultimate losses may be higher, possibly significantly so, than the amounts accrued for legal loss contingencies, which may materially and adversely affect Busey’s financial condition and results of operations. See “ Note 18.
Investments in tax-advantaged projects may not generate returns as anticipated and may have an adverse impact on Busey’s financial results. Busey invests in certain tax-advantaged projects promoting affordable housing, community development, and other community revitalization projects.
Risk Factors Investments in tax-advantaged projects may not generate returns as anticipated and may have an adverse impact on Busey’s financial results. Busey invests in certain tax-advantaged projects promoting renewable energy, affordable housing, community development, and other community revitalization projects.
Risk Factors ECONOMIC AND MARKET RISKS 35 REGULATORY AND LEGAL RISKS 36 CREDIT AND LENDING RISKS 38 CAPITAL AND LIQUIDITY RISKS 40 COMPETITIVE AND STRATEGIC RISKS 41 ACCOUNTING AND TAX RISKS 43 OPERATIONAL RISKS 44 ECONOMIC AND MARKET RISKS Conditions in the financial market and economic conditions, including conditions in the states in which it operates, generally may adversely affect Busey’s business.
Risk Factors ECONOMIC AND MARKET RISKS 36 REGULATORY AND LEGAL RISKS 37 CREDIT AND LENDING RISKS 38 CAPITAL AND LIQUIDITY RISKS 40 COMPETITIVE AND STRATEGIC RISKS 41 ACCOUNTING AND TAX RISKS 45 OPERATIONAL RISKS 46 ECONOMIC AND MARKET RISKS Economic and financial market conditions, including conditions in the states in which it operates, may adversely affect Busey’s business.
A favorable business environment is generally characterized by, among other factors, economic growth, efficient capital markets, low inflation, low unemployment, high business and investor confidence, and strong business earnings.
A favorable business environment is characterized by, among other factors, economic growth, efficient capital markets, low and stable inflation, full employment, high business and investor confidence, and strong business earnings.
Any future impairment of goodwill or other intangible assets, whether based on the current balances or future balances arising out of acquisitions, could have a material adverse effect on the results of operations by reducing net income or increasing net losses. Changes in accounting principles or guidelines could adversely affect financial reporting.
Any future impairment of goodwill or other intangible assets, whether based on the current balances or future balances arising out of acquisitions, could have a material adverse effect on Busey’s financial condition or results of operations. Changes in accounting principles or guidelines could adversely affect financial reporting.
Risk Factors • Supply Chain Risk Amplification : Third-party vendors and their subcontractors introduce multi-layered risks, complicating oversight and heightening the likelihood of service interruptions or compliance breaches. • Advanced Cyber Threats : As bad actors deploy increasingly sophisticated tactics, including artificial intelligence-driven impersonation and malware, the effectiveness of traditional cybersecurity defenses is diminished.
The outcomes of such risks include: • Amplification of Vendor Risk: Third-party vendors and their subcontractors introduce multi-layered risks, complicating oversight and heightening the likelihood of service interruptions or compliance breaches. • Need for Advanced Cyber Protections: As bad actors deploy increasingly sophisticated tactics, including artificial intelligence-driven impersonation and malware, the effectiveness of traditional cybersecurity defenses is diminished.
Nonetheless, shifts in Illinois and Missouri law legalizing cannabis use, along with shifts in Florida law allowing medicinal use and decriminalizing possession, have increased the number of direct and indirect cannabis-related businesses in some of the states in which Busey operates, and therefore increases the likelihood that Busey Bank could interact with such businesses, as well as their owners and employees.
Nonetheless, shifts in state laws legalizing cannabis use and decriminalizing possession have increased the number of direct and indirect cannabis-related businesses in the states in which Busey operates, and therefore increases the likelihood that Busey Bank could interact with such businesses, as well as their owners and employees.
Risk Factors Credit quality deterioration in investment securities may result in significant realized losses, impacting Busey’s financial performance. Busey’s investment portfolio includes securities issued by government-sponsored agencies and non-government entities. While these securities offer portfolio diversification, they are subject to risks such as credit downgrades, collateral underperformance, and issuer defaults.
Busey’s investment portfolio includes securities issued by government-sponsored agencies and non-government entities. While these securities offer portfolio diversification, they are subject to risks such as credit downgrades, collateral underperformance, and issuer defaults. These factors could result in realized losses, negatively impacting Busey’s financial condition and results of operations.
Busey is subject to the risk that previously recorded tax credits, which remain subject to recapture by taxing authorities based on compliance features required at the project level, may fail to meet certain government compliance requirements and may not be realized. The potential inability to realize these tax credits and other tax benefits could negatively impact Busey’s financial results.
Busey is subject to the risk that previously recorded tax credits, which remain subject to recapture by taxing authorities based on compliance features required at the project level, may fail to meet certain government compliance requirements and may not be realized.
First Busey Corporation (BUSE) | 2024 — 40 Table of Contents Contents of Item 1A.
First Busey Corporation (BUSE) | 2025 — 42 Table of Contents Contents of Item 1A.
The unexpected departure of high-performing employees or difficulty in recruiting specialized talent could disrupt operations, delay strategic initiatives, or increase costs associated with workforce realignment. First Busey Corporation (BUSE) | 2024 — 45 Table of Contents Contents of Item 1A. Risk Factors Damage resulting from negative publicity could harm Busey’s reputation and adversely impact its business and financial condition.
The unexpected departure of high-performing employees or difficulty in recruiting specialized talent could disrupt operations, delay strategic initiatives, or increase costs associated with workforce realignment, all of which may materially and adversely affect Busey’s financial condition and results of operations. Damage resulting from negative publicity could harm Busey’s reputation and adversely impact its business and financial condition.
Evolving privacy, data protection, and information security laws and regulations present operational and legal challenges. In the normal course of business, Busey collects, processes, and retains sensitive and confidential information regarding its customers, and Busey’s collection and handling of such information is subject to regulatory scrutiny.
In the normal course of business, Busey collects, processes, and retains sensitive and confidential information regarding its customers, and Busey’s collection and handling of such information is subject to regulatory scrutiny. There has been a heightened legislative and regulatory focus on privacy, data protection, and information security.
One such assumption and estimate is the valuation analysis of Busey’s goodwill and other intangible assets. Although Busey’s analysis does not indicate impairments exist, the Company is required to perform additional impairment assessments on at least an annual basis, which could result in future impairment charges.
Although Busey’s analysis does not indicate impairments exist, Busey is required to perform additional impairment assessments on at least an annual basis, which could result in future impairment charges.
These risks have been amplified by recent economic factors, such as elevated interest rates, inflationary pressures, and a more cautious economic outlook. Busey employs rigorous underwriting standards, monitors industry and geographic loan concentrations, and conducts both internal and external independent loan reviews to mitigate these risks.
These risks have been amplified by certain economic factors, such as elevated interest rates above the Federal Reserve’s 2% target, inflationary pressures, tariffs, geopolitics, and increased economic uncertainty. Busey employs rigorous underwriting standards, monitors portfolio performance, including industry and geographic loan concentrations, and conducts both internal and external independent loan reviews to mitigate these risks.
Outsourcing dependencies could disrupt operations and increase compliance risks. Busey’s reliance on secure and resilient systems to manage customer relationships, transactions, and data underscores the critical importance of operational stability. Outsourcing arrangements introduce risks tied to service disruptions, compliance violations, and vulnerabilities stemming from subcontractors in downstream supply chains.
Busey’s reliance on secure and resilient systems to manage customer relationships, transactions, and data underscores the critical importance of operational stability. Outsourcing arrangements introduce risks tied to service disruptions, compliance violations, and vulnerabilities stemming from subcontractors in downstream supply chains. This cascading outsourcing structure adds complexity to communication and coordination, particularly when vendors operate in regions with varying regulatory standards.
Certain accounting policies are critical and require management to make subjective and complex judgments about matters that are inherently uncertain, and materially different amounts could be reported under different conditions or using different assumptions. If such estimates or assumptions underlying Busey’s Consolidated Financial Statements are incorrect, the Company may experience material losses.
Some of these policies require the use of estimates and assumptions that may affect the value of assets or liabilities and financial results. Certain accounting policies are critical and require management to make subjective and complex judgments about matters that are inherently uncertain, and materially different amounts could be reported under different conditions or using different assumptions.
Busey’s commercial loans are primarily underwritten based on the identified cash flow of the borrower, with collateral serving as secondary support. Credit enhancements often include pledged collateral and personal guarantees, which enhance the likelihood of repayment. However, the availability of funds for repayment—particularly for loans secured by accounts receivable—may depend significantly on the borrower’s ability to collect from their customers.
Busey primarily underwrites commercial loans based on the borrower’s projected cash flows, with collateral serving as secondary support. Credit enhancements—such as pledged collateral and personal guarantees—are often used to improve the likelihood of repayment. However, repayment capacity, particularly for loans secured by accounts receivable, may depend heavily on the borrower’s ability to collect payments from its own customers.
If Busey’s appraisal of the value of the completed project proves to be overstated, or market values or rental rates decline, there may be inadequate security for the repayment of the loan upon completion of construction of the project.
If Busey’s appraisal of the completed project proves overstated, or if market values or rental rates decline, the collateral securing the loan may be insufficient at completion.
Risk Factors Loan concentrations in volatile markets could increase Busey’s exposure to economic downturns, adversely impacting financial stability. Busey may have higher credit risk, or experience higher credit losses, to the extent its loans are concentrated by loan type, industry segment, borrower type, or geographic location of the borrower or collateral.
Risk Factors Loan concentrations in volatile markets could increase Busey’s exposure to adverse economic conditions and heighten credit risk. Busey may face elevated credit risks, or experience increased credit losses, when its loan portfolio is concentrated by loan type, industry segment, borrower characteristics, or the geographic location of borrowers or collateral.
These factors could result in realized losses, negatively impacting Busey’s financial condition and results of operations. CAPITAL AND LIQUIDITY RISKS Failure to maintain sufficient capital to meet regulatory requirements could have material adverse effects on financial condition, liquidity, results of operations, and regulatory compliance. Busey must meet regulatory capital requirements and maintain sufficient liquidity.
CAPITAL AND LIQUIDITY RISKS Failure to maintain sufficient capital to meet regulatory requirements could have material adverse effects on financial condition, liquidity, results of operations, and regulatory compliance. Busey is required to satisfy regulatory capital standards and to maintain sufficient liquidity to support ongoing operations and strategic objectives.
Busey’s ability to raise additional capital as needed will depend on conditions in the capital markets, economic conditions, and a number of other factors, including investor perceptions regarding the banking industry, market conditions, and governmental activities, many of which are outside Busey’s control, as well as on its financial condition and performance.
Its ability to raise additional capital when needed depends on conditions in the capital markets, broader economic trends, investor sentiment toward the banking industry, governmental actions, and other factors outside Busey’s control, as well as Busey’s own financial performance and condition.
Failures to effectively manage these risks could adversely impact Busey’s financial condition, regulatory standing, and overall operational stability. To address these challenges, Busey continuously refines its processes, leveraging advanced risk assessment tools and seeking alignment with industry best practices. Despite these efforts, no risk management framework is foolproof, and unforeseen losses or disruptions remain a possibility.
To address these challenges, Busey continuously refines its risk management processes, leveraging enhanced risk assessment tools, investing in automation and analytics, and aligning with industry best practices. Despite these efforts, no risk management framework is foolproof, and unforeseen losses or disruptions remain a possibility, which may materially and adversely affect Busey’s financial condition and results of operations.
The resolution of these assets demands significant management attention and regulatory compliance, which can divert resources from other priorities. Non-performing loans and OREO properties elevate Busey’s risk profile and require ongoing vigilance to minimize financial and operational disruptions. First Busey Corporation (BUSE) | 2024 — 38 Table of Contents Contents of Item 1A.
Non-performing loans and OREO properties elevate Busey’s risk profile and require ongoing vigilance to minimize financial and operational disruptions, which may adversely affect Busey’s financial condition and results of operations. First Busey Corporation (BUSE) | 2025 — 38 Table of Contents Contents of Item 1A.
Risk Factors While Busey has determined that no valuation allowance is currently required for any deferred tax assets, if future events differ significantly from current forecasts, the Company may need to establish a valuation allowance against its net deferred tax assets, which would have a material adverse effect on its results of operations and financial condition.
If future events differ significantly from current forecasts, Busey may need to establish an additional valuation allowance against its deferred tax assets, which could have a material adverse effect on its financial condition and results of operations. First Busey Corporation (BUSE) | 2025 — 45 Table of Contents Contents of Item 1A.
Significant judgment by management about matters that are, by nature, uncertain is required to record a deferred tax asset and establish a valuation allowance. In evaluating the need for a valuation allowance, Busey estimates future taxable income based on management forecasts and tax planning strategies that may be available to the Company.
A valuation allowance is established against a deferred tax asset when it is more-likely-than-not that some or all of the future tax benefit will not be realized. In evaluating the need for a valuation allowance, Busey estimates future taxable income based on management forecasts and tax planning strategies that may be available to the Company.
Introduction of new products and services carries financial and strategic risks. Busey strives to serve customers with a competitive product set and relevant services. While introducing new lines of business or innovative products and services supports this goal, these efforts carry inherent risks. Competitive pressures, underdeveloped markets, or unforeseen challenges can lead to delayed timelines and missed profitability targets.
While introducing new lines of business or innovative products and services supports this goal, these efforts carry inherent risks. Competitive pressures, underdeveloped markets, or unforeseen challenges can lead to delayed timelines and missed profitability targets. Significant investments in technology and marketing may not yield the desired outcomes. These risks may materially adversely affect Busey’s financial condition and results of operations.
Any decline in available funding and/or capital could adversely impact Busey’s ability to originate loans, invest in securities, meet its expenses, pay dividends to its stockholders, or meet deposit withdrawal demands, any of which could have a material adverse impact on its liquidity, business, financial condition, and results of operations.
A reduction in available funding or capital could constrain Busey’s ability to originate new loans, purchase investment securities, meet operating expenses, satisfy deposit withdrawal demands, or pay dividends to stockholders. Failure to effectively manage liquidity needs could materially and adversely affect Busey’s liquidity position, overall financial condition, and results of operations.
Changes in tax laws could affect Busey’s earnings, its customers’ financial positions, or both. Deferred tax assets are designed to reduce subsequent period income tax expense. They arise, in part, as a result of net loss carry-overs, and other book accounting to tax accounting differences, for items such as expected credit losses, stock-based compensation, and deferred compensation.
They arise, in part, as a result of net loss carry-overs, and other book accounting to tax accounting timing differences, for items such as expected credit losses, stock-based compensation, and deferred compensation. Deferred tax assets are recorded for such items when it is anticipated that the tax benefits will be recognized in earnings in future periods.
Shifts in consumer and business behavior during economic uncertainty may impact Busey’s business. Uncertainty regarding economic conditions may result in changes in consumer and business spending, borrowing, and savings habits.
Policy uncertainty—including tariffs, immigration enforcement, and regulatory changes—further complicates planning. These factors may adversely affect Busey’s business, financial condition, results of operations, and growth prospects. Shifts in consumer and business behavior during economic uncertainty may impact Busey’s business. Uncertainty regarding economic conditions may result in changes in consumer and business spending, borrowing, and savings habits.
Such interactions could create additional legal, regulatory, strategic, and reputational risk to Busey Bank and First Busey Corporation. First Busey Corporation (BUSE) | 2024 — 37 Table of Contents Contents of Item 1A.
Such interactions could create additional legal, regulatory, strategic, and reputational risk to Busey Bank and First Busey Corporation. Any such legal, regulatory, or reputational exposure could adversely affect Busey’s financial condition and results of operations.
Outstanding Commitments and Contingent Liabilities ” in the Notes to the Consolidated Financial Statements for information regarding an inquiry from the Illinois Secretary of State, pursuant to which the Illinois Secretary of State asked for additional information regarding certain of Busey’s franchise tax filings and the calculation of amounts due thereunder.
Outstanding Commitments and Contingent Liabilities ” in the Notes to the Consolidated Financial Statements for information regarding an ongoing dispute regarding the amount of franchise taxes, penalties, interest, fees, and charges purportedly due from First Busey Corporation to the Illinois Secretary of State.
In addition, trends in financial and business reporting, including environmental, social, and governance related disclosures, could require Busey to incur additional reporting expense. Changes in these standards are continuously occurring, and the implementation of such changes could have a material adverse effect on Busey’s financial condition and results of operations.
Changes in these standards are continuously occurring, and the implementation of such changes could have a material adverse effect on Busey’s financial condition and results of operations. Busey is subject to changes in tax law and may not realize tax benefits which could adversely affect its results of operations.
OPERATIONAL RISKS Busey’s framework for managing risks may not be fully effective in mitigating risk and loss. Busey’s risk management framework is designed to identify, measure, monitor, and analyze a broad spectrum of risks, including compliance, operational, and reputational risks. However, as with any framework, inherent limitations exist, particularly as new risks emerge or previously unidentified vulnerabilities become apparent.
The potential inability to realize these tax credits and other tax benefits could negatively impact Busey’s earnings and financial condition. OPERATIONAL RISKS Busey’s framework for managing risks may not be fully effective in mitigating risk and loss. Busey’s risk management framework is designed to identify, measure, monitor, and analyze a broad spectrum of risks, including compliance, operational, and reputational risks.
While management considers the ACL adequate to absorb probable losses, unforeseen economic disruptions or borrower-specific events could necessitate additional provisions, adversely affecting financial performance. High levels of non-performing assets could reduce Busey’s profitability and strain operational resources. Non-performing assets negatively impact Busey’s financial condition through lost interest income, increased loan administration costs, and adverse effects on efficiency ratios.
Elevated levels of non-performing assets could reduce Busey’s profitability and strain operational resources. Non-performing assets negatively impact Busey’s financial condition through lost interest income, increased loan administration costs, and adverse effects on efficiency ratios. The resolution of these assets demands significant management attention and regulatory compliance, which can divert resources from other priorities.
Busey is subject to changes in tax law and may not realize tax benefits which could adversely affect its results of operations. Changes in tax laws at national or state levels could have an effect on Busey’s short-term and long-term earnings. Tax law changes are both difficult to predict and beyond Busey’s control.
Changes in tax laws at federal or state levels could influence Busey’s short-term and long-term earnings. Tax law changes are both difficult to predict and beyond Busey’s control. These laws are complex and subject to different interpretations by the taxpayer and the various taxing authorities.
In periods of economic recession, this capacity could decline, increasing repayment risks. Collateral securing loans may depreciate over time, be difficult to appraise, or fluctuate in value based on the borrower’s business performance.
During periods of economic stress or industry‑specific downturns, borrowers may experience weakened collections, which can elevate repayment risk. Collateral securing commercial loans may depreciate over time, be difficult to accurately value, or fluctuate in response to changes in the borrower’s financial condition or business performance.
Additional liquidity is available through repurchase agreements, brokered deposits, and the ability to borrow from the Federal Reserve Bank and the FHLB.
Additional liquidity is available through repurchase agreements, brokered deposits, and borrowing capacity with the FHLB and the Federal Reserve Bank. An inability to access these funding sources in adequate amounts or on acceptable terms could materially impair liquidity.
Busey’s failure to continue to maintain capital ratios in excess of the amounts necessary to be considered “well-capitalized” for bank regulatory purposes could affect customer confidence, its ability to grow, its costs of funds, the cost of FDIC insurance, its ability to pay dividends to its stockholders on outstanding stock, its ability to make acquisitions, and its business, results of operations, and financial condition.
Failure to maintain capital ratios at levels sufficient to be considered “well‑capitalized” for regulatory purposes could negatively affect customer confidence, constrain growth opportunities, increase funding costs, raise FDIC insurance premiums, restrict the ability to pay dividends, limit acquisition capacity, and otherwise adversely affect business operations.
The cessation of analyst coverage could exacerbate these challenges, diminishing interest in Busey’s stock. Intense competition from traditional banks and fintech companies threatens market share. Busey operates in highly competitive markets across Illinois, Missouri, Indiana, and Florida, with competitors ranging from national and regional banks to fintech companies offering digital-first solutions.
The cessation of analyst coverage could exacerbate these challenges, diminishing interest in Busey’s stock and affecting stock performance. Busey faces significant competition from traditional financial institutions and emerging non‑bank competitors threatening market share.
While Busey conducts rigorous due diligence when selecting third-party providers, residual risks from subsequent outsourcing tiers remain challenging to eliminate entirely. Fraudulent activities could erode financial stability and customer trust. The rising sophistication of fraudulent schemes poses a persistent challenge for financial institutions, with Busey being no exception.
Failures or breaches in these systems could disrupt Busey’s operations, damage its reputation, and materially and adversely affect its financial conditions and results of operations. Fraudulent activities could erode financial stability and customer trust. The rising sophistication of fraudulent schemes poses a persistent challenge for financial institutions, with Busey being no exception.
Such conditions could adversely affect the credit quality of Busey’s loans, financial condition, and results of operations. First Busey Corporation (BUSE) | 2024 — 35 Table of Contents Contents of Item 1A. Risk Factors Regional economic vulnerabilities and reliance on key industries may heighten risks. Busey currently conducts its banking operations in central and suburban Chicago, Illinois; the St.
Such conditions could adversely affect Busey’s asset quality, financial condition, and results of operations. Regional economic vulnerabilities may heighten risks.
The leadership transitions associated with the CrossFirst merger highlight the importance of talent management in preserving operational continuity. In addition to retaining key leaders, Busey’s ability to build a diverse and skilled workforce is essential to implementing its community-based strategy effectively.
Beyond executive leadership, Busey's ability to build and maintain a diverse and skilled workforce is essential to implementing its community-based strategy and serving an expanded geographic footprint.
CRE represents an important component of Busey’s loan portfolio and is inherently sensitive to economic fluctuations. Busey’s two primary categories of CRE are (1) CRE that is occupied by the property owner, and (2) CRE that is held as investment property.
CRE is a significant component of Busey’s loan portfolio and is inherently sensitive to broader economic and market fluctuations.
Borrowers across various industries may face challenges due to sector-specific pressures or macroeconomic factors, which could lead to elevated non-performing loans, charge-offs, or provisioning needs. Busey establishes the ACL based on detailed analyses of the loan portfolio and broader market conditions, incorporating management judgments and forward-looking forecasts.
Busey establishes the ACL based on detailed analyses of the loan portfolio and broader market conditions, incorporating forward-looking forecasts and management judgments. While management considers the ACL adequate to absorb probable losses, unforeseen economic disruptions or borrower-specific events could necessitate additional provisions and adversely affect Busey’s financial condition and results of operations.
However, even robust frameworks may not fully eliminate risks, particularly as threat actors adapt their tactics to exploit emerging vulnerabilities. Busey’s ability to attract and retain key personnel may affect future growth and earnings. Busey’s ability to attract and retain experienced management and qualified personnel is critical to sustaining growth and executing its strategic objectives.
Busey’s ability to attract and retain key personnel may affect future growth and earnings. Busey’s ability to attract and retain experienced management and qualified personnel remains critical to sustaining growth and executing its strategic objectives. Despite continued investment in leadership development, succession planning, and employee engagement, competitive labor markets and evolving employee expectations pose ongoing challenges.
These estimates may be inaccurate, and Busey may be exposed to significant losses on loans for these projects. Construction, land acquisition, and development loans involve additional risks because funds are advanced upon the security of the project, which is of uncertain value prior to its completion, and costs may exceed realizable values in declining real estate markets.
Construction, land acquisition, and development lending carries additional risk because loan proceeds are advanced based on the projected value of a property that will not be realized until the project is completed. In periods of declining real estate markets conditions, construction costs may exceed expected values, resulting in diminished collateral coverage.
Busey’s ability to attract and retain customers, investors, and employees is contingent upon maintaining trust.
Busey’s ability to attract and retain customers, investors, employees, and business partners depends significantly on the trust placed in its brand, business practices, and commitment to responsible conduct.
As a result, construction loans often involve the disbursement of substantial funds with repayment dependent, in part, on the success of the ultimate project and the ability of the borrower to sell or lease the property, rather than the ability of the borrower or guarantor to repay principal and interest.
Risk Factors Repayment of these loans is often dependent on the successful completion and stabilization of the project, including the borrower’s ability to sell or lease the property, rather than solely on the borrower’s or guarantor’s financial capacity.
These loans are particularly sensitive to factors such as reduced rental income, higher vacancy rates, and regulatory changes. Declines in market demand, economic downturns, or increased tenant defaults could significantly impact the borrower’s ability to repay these loans. Declining borrower cash flows and fluctuating collateral values may lead to significant losses across Busey’s commercial loan portfolio.
These loans are more vulnerable to changes in market demand, tenant turnover, rising vacancy rates, reduced rental income, and potential regulatory shifts affecting commercial leasing or property use. Economic downturns or weakened tenant performance can materially impact the borrower’s ability to meet repayment obligations.
The effectiveness of this framework depends on its alignment with Busey’s evolving risk profile, especially in light of the planned CrossFirst merger. As the organization grows in complexity, risks related to integration, system coordination, and operational oversight may challenge the framework's capacity to adapt.
However, as with any framework, inherent limitations exist, particularly as new risks emerge or previously unidentified vulnerabilities become apparent. The effectiveness of this framework depends on its alignment with Busey’s evolving risk profile, especially following the completion of the CrossFirst merger.
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Given the complex factors affecting the strength of the U.S. economy, including uncertainties regarding the persistence of inflation; geopolitical developments, such as ongoing conflicts in the Middle East and the Russian invasion of Ukraine, and resulting disruptions in the global energy market; tight labor market conditions domestically; supply chain issues both domestically and internationally; and the potential effects of the new presidential administration, including its response to the foregoing, potential imposition of new tariffs, mass deportations and changes to tax or other financial regulations, uncertainty surrounding future changes may adversely affect Busey’s operating environment and therefore its business, financial condition, results of operations, and growth prospects.
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Current conditions reflect elevated interest rates and persistent inflation above the Federal Reserve’s 2% target, which continue to pressure borrowing costs and consumer confidence. Fiscal imbalances, including a large federal deficit and rising debt-service obligations, add longer-term uncertainty.
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Louis, Missouri metropolitan area; central Indiana; and southwest Florida. Busey operates in markets with a significant university and healthcare presence. These industries rely heavily on state and federal funding and contracts.
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Geopolitical conflicts across the globe, including conflicts in the Middle East, the Russian invasion of Ukraine, and the recent military activity in Venezuela, sustain volatility in energy and trade markets, while domestic labor markets remain tight in key sectors despite slowing job growth. Supply chain disruptions, though improved, persist due to structural and geopolitical factors.
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Timely payments by the State of Illinois to its vendors and government-sponsored entities, as well as potential federal changes to healthcare laws, could affect Busey’s primary market areas, which could in turn affect its financial condition and results of operations. A small part of Busey’s business resides in Florida, which can be affected by inclement weather.
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Busey conducts banking operations across ten states, including Illinois, Missouri, Texas, Colorado, Florida, Kansas, Oklahoma, Arizona, Indiana, and New Mexico, with a focus in the major metropolitan areas in these states, which can be more susceptible to economic cycles, real estate market volatility, and localized downturns.
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Prolonged elevated interest rates followed by easing cycles create financial volatility. Prolonged periods of elevated interest rates followed by an easing cycle pose significant challenges and opportunities for Busey.
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Urban markets often experience sharper volatility in employment, housing demand, and commercial development, which can affect credit quality and loan demand. These regional and metropolitan exposures could adversely impact Busey’s financial condition and results of operations. First Busey Corporation (BUSE) | 2025 — 36 Table of Contents Contents of Item 1A.
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While an easing cycle, which is characterized by the FOMC taking action to reduce interest rates, can alleviate some funding pressures and encourage borrowing, it also introduces risks to the banking sector. A rapid shift in rates can compress net interest margins, disrupt asset-liability management, and affect the valuation of financial instruments.
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Risk Factors Changes in interest rates and yield‑curve dynamics may compress net interest margin, affect asset valuations, and create liquidity pressures. Busey’s financial performance depends heavily on the level, direction, and volatility of interest rates.
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After a series of rate hikes starting in March 2022, the FOMC began an easing cycle in September 2024, responding to slowing inflation and economic growth. As of December 2024, the federal funds target range was reduced to 4.25%–4.5%, marking a gradual reversal from the peak of 5.25%–5.5% in 2023.
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Movements in short‑term or long‑term rates—and changes in the shape of the yield curve—may materially affect net interest income and the value of interest‑earning assets and funding sources. Rising rates can increase funding costs faster than earning‑asset yields reprice, compressing net interest margin, reducing fair values of fixed‑rate assets, and slowing loan demand.
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This shift reflects a softening economic environment, with the FOMC aiming to balance inflation reduction while avoiding a sharp contraction in economic activity. Declining interest rates result in reduced income from lending and investment activities, and may drive consumers to seek higher-yielding alternatives outside of traditional banking, both of which could negatively impact Busey’s liquidity and results of operations.
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Conversely, declining rates may reduce yields on loans and securities more quickly than deposit costs decline, accelerate prepayments on fixed‑rate loans and securities, and require reinvestment at lower rates. In addition, inverted or flattened yield curves may limit opportunities to profitably deploy funds and can discourage borrowers from seeking longer‑term credit.
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While rate cuts can stimulate loan demand, they also create potential threats to the banking sector. Falling interest rates may reduce yields on loans and securities more quickly than the cost of deposits declines, narrowing margins. Deposit outflows could accelerate if customers seek higher-yielding alternatives outside traditional banking, further challenging liquidity.
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Busey’s interest‑rate risk management strategies may not fully mitigate these impacts. Sustained interest‑rate volatility, rapid shifts in the yield curve, or an inability to effectively manage interest‑rate sensitivity could materially and adversely affect Busey’s net interest income, liquidity position, financial condition, and results of operations.
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Lower rates can lead to prepayments on fixed-rate loans, impacting the value of interest-earning assets and requiring adjustments to portfolios. Despite these risks, the easing cycle may present opportunities for growth. Lower rates can revitalize loan demand, particularly in key areas such as mortgages, auto loans, and small business lending, while providing some relief to borrowers under stress.
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REGULATORY AND LEGAL RISKS Changes in government policies and regulatory frameworks could adversely affect operations and profitability. The banking regulatory environment is a complex mix of increased deferment to local regulatory authorities relative to international rulemaking, adapting to digital innovation (e.g., AI, digital assets, etc.), and potential easing of federal regulatory oversight.
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However, the broader economic environment, including rising consumer debt levels, increasing delinquencies, and persistent inflation risks could still impact Busey’s financial condition, liquidity, and overall performance. REGULATORY AND LEGAL RISKS Changes in government policies and regulatory frameworks could adversely affect operations and profitability.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeBusey’s board of directors, as a whole and through its Enterprise Risk Committee (the “Risk Committee”), is responsible for the oversight of risk management. In that role, Busey’s board of directors and Risk Committee, with support from Busey’s cybersecurity advisors, are responsible for ensuring that the risk management processes developed and implemented by management are adequate and functioning as designed.
Biggest changeIn that role, Busey’s board of directors and its Risk Committee, with support from Busey’s cybersecurity advisors, are responsible for ensuring that the risk management processes developed and implemented by management are adequate and functioning as designed.
Busey has long devoted significant resources to assessing, identifying, and managing risks associated with cybersecurity threats, including: • Establishing an internal cybersecurity team that is responsible for conducting regular assessments of Busey’s information systems, existing controls, vulnerabilities, and potential improvements; First Busey Corporation (BUSE) | 2024 — 46 Table of Contents • Employing continuous monitoring tools that can detect and help respond to cybersecurity threats in real-time; • Performing due diligence with respect to third-party service providers, including their cybersecurity practices, and requiring contractual commitments from Busey’s service providers to take certain cybersecurity measures; • Ongoing monitoring and assessment of third-party vendors' cybersecurity practices, including regular audits, compliance checks, and incident reporting requirements; • Engaging third-party cybersecurity consultants, who conduct periodic penetration testing, vulnerability assessments, and other procedures to identify potential weaknesses in Busey’s systems and processes; • Mandating periodic cybersecurity training for Busey’s workforce, which includes awareness programs on phishing, social engineering, and other common cyber threats; • Implementing access control measures such as multi-factor authentication, role-based access controls, and regular access reviews to ensure that only authorized personnel have access to critical systems and data; • Using data encryption for both data at rest and data in transit to protect sensitive information; and • Creating an incident response plan that outlines the steps to contain, mitigate, and remediate the impact of cybersecurity incidents, including communication protocols and post-incident analysis.
Busey has long devoted significant resources to assessing, identifying, and managing risks associated with cybersecurity threats, including: • Establishing an internal cybersecurity team that is responsible for conducting regular assessments of Busey’s information systems, existing controls, vulnerabilities, and potential improvements; • Employing continuous monitoring tools that can detect and help respond to cybersecurity threats in real-time; • Performing due diligence with respect to third-party service providers, including their cybersecurity practices, and requiring contractual commitments from Busey’s service providers to take certain cybersecurity measures; • Ongoing monitoring and assessment of third-party vendors' cybersecurity practices, including regular audits, compliance checks, and incident reporting requirements; First Busey Corporation (BUSE) | 2025 — 48 Table of Contents • Engaging third-party cybersecurity consultants, who conduct periodic penetration testing, vulnerability assessments, and other procedures to identify potential weaknesses in Busey’s systems and processes; • Mandating periodic cybersecurity training for Busey’s workforce, which includes awareness programs on phishing, social engineering, and other common cyber threats; • Implementing access control measures such as multi-factor authentication, role-based access controls, and regular access reviews to ensure that only authorized personnel have access to critical systems and data; • Using data encryption for both data at rest and data in transit to protect sensitive information; and • Creating an incident response plan that outlines the steps to contain, mitigate, and remediate the impact of cybersecurity incidents, including communication protocols and post-incident analysis.
Busey’s CISO has been in the role since September 2020 and has over 15 years of experience across external and internal audit, technology risk management, and cybersecurity matters, spanning various industries primarily within the financial services sector, but also including healthcare, technology, consumer products, and manufacturing for both regional and multinational corporations.
Busey’s CISO has been in the role since September 2020 and has over 15 years of experience across external and internal audit, technology risk management, and cybersecurity matters, primarily within the financial services sector, and also including additional industries such as healthcare, technology, consumer products, and manufacturing for both regional and multinational corporations.
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Busey’s board of directors, as a whole and through its Enterprise Risk Committee (the “Risk Committee”), is responsible for the oversight of risk management.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeITEM 2. PROPERTIES First Busey Corporation’s and Busey Bank’s headquarters are located at 100 West University Avenue, Champaign, Illinois. FirsTech’s headquarters is located at 130 North Water Street, Decatur, Illinois. These facilities, which are owned by the Company, house the executive and primary administrative offices of each respective entity.
Biggest changePROPERTIES The following facilities, which are owned by Busey, house the executive and primary administrative offices of each respective entity: First Busey Corporation Busey Bank FirsTech 11440 Tomahawk Creek Parkway Leawood, KS 66211 100 West University Avenue Champaign, IL 61820 130 North Water Street Decatur, IL 62523 First Busey Corporation and its subsidiaries also own or lease other facilities, such as banking centers of Busey Bank, for business operations.
First Busey Corporation and its subsidiaries also own or lease other facilities, such as banking centers of Busey Bank, for business operations. First Busey Corporation (BUSE) | 2024 — 47 Table of Contents Busey considers its properties to be suitable and adequate for its present needs. None of the properties are subject to any material encumbrance.
Busey considers its properties to be suitable and adequate for its present needs. None of the properties are subject to any material encumbrance.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThere is no material pending litigation, other than ordinary routine litigation incidental to its business, in which First Busey Corporation or any of its subsidiaries is involved or of which any of their property is the subject.
Biggest changeFirst Busey Corporation (BUSE) | 2025 — 49 Table of Contents Other than the foregoing lawsuits, there is no material pending litigation, other than ordinary routine litigation incidental to its business, in which First Busey Corporation or any of its subsidiaries is involved or of which any of their property is the subject.
Furthermore, there is no pending legal proceeding that is adverse to Busey in which any director, officer, or affiliate of Busey, or any associate of any such director or officer, is a party, or has a material interest.
Furthermore, there is no pending legal proceeding that is adverse to Busey in which any director, officer, or affiliate of Busey, or any associate of any such director or officer, is a party, or has a material interest. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. PART II
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On November 25, 2025, First Busey Corporation filed two lawsuits against the Illinois Secretary of State in connection with an ongoing dispute regarding the amount of franchise taxes, penalties, interest, fees, and charges purportedly due from First Busey Corporation to the Illinois Secretary of State. See “ Note 18.
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Outstanding C ommitments and Contingent Liabilities ” in the Notes to the Consolidated Financial Statements for further information.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeAdditionally, there were an estimated 14,297 beneficial holders whose stock was held in street name by brokerage houses and nominees as of that date.
Biggest changeAs of February 26, 2026, First Busey Corporation had 86,227,449 shares of common stock outstanding held by 1,833 holders of record. Additionally, there were an estimated 18,322 beneficial holders whose stock was held in street name by brokerage houses and nominees as of that date.
The Stock Repurchase Plan provides Busey with treasury shares from which stock-based compensation can be issued, and it limits the number of outstanding shares that may be actively traded. The Stock Repurchase Plan does not obligate Busey to purchase any shares of its common stock, and has no expiration date.
The Stock Repurchase Plan provides Busey with treasury shares from which stock-based compensation can be issued, and it limits the number of outstanding shares that may be actively traded. The Stock Repurchase Plan does not obligate Busey to purchase any shares of its common stock, and it has no expiration date.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES COMMON STOCK Busey’s common stock is traded on The Nasdaq Global Select Market under the symbol “BUSE.” Busey’s board of directors and management are currently committed to continue paying regular cash dividends; however, no guarantee can be given with respect to future dividends, as they are dependent on certain regulatory restrictions, future earnings, capital requirements, and the financial condition of First Busey Corporation and its subsidiaries.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES COMMON STOCK Busey’s common stock is traded on The Nasdaq Global Select Market under the symbol “BUSE.” Busey has a history of paying regular dividends, and Busey’s board of directors and management are committed to continuing to pay regular cash dividends on its common stock; however, no guarantee can be given with respect to future dividends, as they are dependent on certain regulatory restrictions, future earnings, capital requirements, and the financial condition of First Busey Corporation and its subsidiaries.
Under the Stock Repurchase Plan, Busey's board of directors has authorized shares for repurchase as shown in the table below: Number of Shares Authorized February 3, 2015 666,667 May 22, 2019 1,000,000 February 5, 2020 2,000,000 May 24, 2023 2,000,000 During the fourth quarter of 2024, Busey purchased no shares of its common stock pursuant to the Stock Repurchase Plan.
Under the Stock Repurchase Plan, Busey's board of directors has authorized shares for repurchase as shown in the table below: Number of Shares Authorized February 3, 2015 666,667 May 22, 2019 1,000,000 February 5, 2020 2,000,000 May 24, 2023 2,000,000 May 29, 2025 2,000,000 December 4, 2025 4,000,000 First Busey Corporation (BUSE) | 2025 — 50 Table of Contents During the fourth quarter of 2025, Busey purchased 1,251,100 shares of its common stock pursuant to the Stock Repurchase Plan.
As of December 31, 2024, Busey had 1,919,275 shares that may still be purchased under the Stock Repurchase Plan.
As of December 31, 2025, Busey had 4,856,175 shares that may still be purchased under the Stock Repurchase Plan.
BMI Banks – Midwest Region Index represent all Major Exchange Traded Banks in S&P Capital IQ’s coverage universe that are headquartered in Colorado, Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Ohio, South Dakota, and Wisconsin.
BMI Banks – Midwest Region Index represent all Major Exchange Traded Banks in S&P Capital IQ’s coverage universe that are headquartered in Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Ohio, South Dakota, and Wisconsin. For purposes of the comparative total return graph, Busey intends to replace the Nasdaq Composite with the Russell 2000 Index.
See “ Item 1. Business—Supervision, Regulation, and Other Factors—Supervision and Regulation of First Busey Corporation—Dividend Payments ” and “ Item 1. Business—Supervision, Regulation, and Other Factors—Supervision and Regulation of Busey Bank—Dividend Payments ” for further discussion of these matters. As of February 27, 2025, First Busey Corporation had 56,958,853 shares of common stock outstanding held by 1,766 holders of record.
See “ Item 1. Business—Supervision, Regulation, and Other Factors—Supervision and Regulation of First Busey Corporation—Dividend Payments ” and “ Item 1. Business—Supervision, Regulation, and Other Factors—Supervision and Regulation of Busey Bank—Dividend Payments ” for further discussion of these matters. Busey’s preferred stock outstanding has preference over Busey’s common stock with respect to payment of dividends.
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First Busey Corporation (BUSE) | 2024 — 49 Table of Contents STOCK PERFORMANCE GRAPH The following graph compares Busey’s performance, as measured by the change in price of its common stock plus reinvested dividends, with the Nasdaq Composite and the S&P U.S. BMI Banks – Midwest Region for the five years ended December 31, 2024. Banks in the S&P U.S.
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Period Total Number of Common Shares Purchased Weighted Average Price Paid per Common Share Number of Common Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Common Shares That May Yet Be Purchased Under the Plans or Programs October 1-31, 2025 300,000 $ 23.04 300,000 1,807,275 November 1-30, 2025 308,000 22.84 308,000 1,499,275 December 1-31, 2025 643,100 24.68 643,100 4,856,175 Three months ended December 31, 2025 1,251,100 $ 23.84 1,251,100 Year ended December 31, 2025 3,063,100 $ 22.81 3,063,100 STOCK PERFORMANCE GRAPH The following graph compares Busey’s performance, as measured by the change in price of its common stock plus reinvested dividends, with the Nasdaq Composite, the Russell 2000 Index, the KBW Nasdaq Regional Banking Index, and the S&P U.S.
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As of December 31, Index 2019 2020 2021 2022 2023 2024 First Busey Corporation $ 100.00 $ 82.03 $ 107.26 $ 101.45 $ 106.61 $ 105.30 S&P U.S. BMI Banks – Midwest Region 100.00 85.98 113.59 98.03 100.08 122.10 Nasdaq Composite 100.00 144.92 177.06 119.45 172.77 223.87
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BMI Banks – Midwest Region over the five years ended December 31, 2025. The KBW Nasdaq Regional Banking Index seeks to reflect the performance of publicly traded U.S. regional banks and thrift institutions. Banks in the S&P U.S.
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Busey’s management believes the Russell 2000 Index is more comparable because it includes a higher percentage representation from the finance sector, and its market capitalization range provides a more representative and comparable group to Busey’s market capitalization. In addition, for purposes of the comparative total return graph, Busey intends to replace the S&P U.S.
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BMI Banks – Midwest Region with the KBW Nasdaq Regional Banking Index.
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With Busey’s expanded footprint beyond the Midwest region, Busey’s management believes the KBW Nasdaq Regional Banking Index now provides a more appropriate comparison, and beginning in 2025 Busey’s new equity award grants with a total stockholder return performance goal will be evaluated in comparison to the KBW Nasdaq Regional Banking Index.
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First Busey Corporation (BUSE) | 2025 — 51 Table of Contents As of December 31, Index 2020 2021 2022 2023 2024 2025 First Busey Corporation $ 100.00 $ 130.76 $ 123.68 $ 129.97 $ 128.37 $ 135.42 KBW Nasdaq Regional Banking Index 100.00 136.64 127.17 126.67 143.39 152.71 S&P U.S.
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BMI Banks – Midwest Region 100.00 132.12 114.02 116.40 142.02 159.02 Russell 2000 Index 100.00 114.82 91.35 106.82 119.14 134.40 Nasdaq Composite 100.00 122.18 82.42 119.22 154.47 187.12

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeGovernment obligations 5,495 158 2.88 % 79,669 578 0.73 % 179,557 1,079 0.60 % Obligations of states and political subdivisions 1 153,467 4,338 2.83 % 233,377 6,560 2.81 % 286,220 7,611 2.66 % Other securities 2,567,526 69,786 2.72 % 2,875,769 76,568 2.66 % 3,265,271 61,591 1.89 % Restricted bank stock 14,414 848 5.88 % 16,416 1,170 7.13 % 6,667 189 2.83 % Loans held for sale 8,012 503 6.28 % 1,885 116 6.13 % 5,178 192 3.71 % Portfolio loans 1, 2 7,804,629 427,300 5.47 % 7,759,472 387,193 4.99 % 7,445,962 288,615 3.88 % Total interest-earning assets 1, 3 10,999,424 $ 525,374 4.78 % 11,181,010 $ 482,716 4.32 % 11,479,730 $ 362,374 3.16 % Cash and due from banks 109,400 116,530 120,910 Premises and equipment 121,663 124,565 131,657 ACL (89,369) (92,991) (89,387) Other assets 910,753 917,104 850,038 Total assets $ 12,051,871 $ 12,246,218 $ 12,492,948 Liabilities and stockholders’ equity Interest-bearing transaction deposits $ 2,469,664 $ 42,925 1.74 % $ 2,775,045 $ 43,268 1.56 % $ 2,785,439 $ 7,150 0.26 % Savings and money market deposits 3,246,507 74,536 2.30 % 2,870,397 37,038 1.29 % 3,326,259 4,237 0.13 % Time deposits 1,584,953 61,002 3.85 % 1,406,928 43,679 3.10 % 846,738 4,725 0.56 % Federal funds purchased and repurchase agreements 147,786 4,308 2.92 % 200,894 5,203 2.59 % 244,004 1,475 0.60 % Borrowings 4 240,137 13,651 5.68 % 500,301 26,881 5.37 % 309,175 15,932 5.15 % Junior subordinated debt issued to unconsolidated trusts 74,037 4,648 6.28 % 71,894 3,853 5.36 % 71,716 3,029 4.22 % Total interest-bearing liabilities 7,763,084 $ 201,070 2.59 % 7,825,459 $ 159,922 2.04 % 7,583,331 $ 36,548 0.48 % Net interest spread 1 2.19 % 2.28 % 2.68 % Noninterest-bearing deposits 2,738,892 3,018,563 3,550,517 Other liabilities 207,471 204,685 163,929 Stockholders’ equity 1,342,424 1,197,511 1,195,171 Total liabilities and stockholders’ equity $ 12,051,871 $ 12,246,218 $ 12,492,948 Interest income / earning assets 1, 3 $ 10,999,424 $ 525,374 4.78 % $ 11,181,010 $ 482,716 4.32 % $ 11,479,730 $ 362,374 3.16 % Interest expense / earning assets 10,999,424 201,070 1.83 % 11,181,010 159,922 1.43 % 11,479,730 36,548 0.32 % Net interest margin 1 $ 324,304 2.95 % $ 322,794 2.89 % $ 325,826 2.84 % ___________________________________________ 1.
Biggest changeGovernment obligations 79,669 578 0.73 % Obligations of states and political subdivisions 233,377 6,560 2.81 % Other securities 2,875,769 76,568 2.66 % Restricted bank stock 16,416 1,170 7.13 % Loans held for sale 1,885 116 6.13 % Portfolio loans 1, 2 7,759,472 387,193 4.99 % Total interest-earning assets 1, 3 11,181,010 $ 482,716 4.32 % Cash and due from banks 116,530 Premises and equipment 124,565 ACL (92,991) Other assets 917,104 Total assets $ 12,246,218 Liabilities and stockholders’ equity Interest-bearing transaction deposits $ 2,775,045 $ 43,268 1.56 % Savings and money market deposits 2,870,397 37,038 1.29 % Time deposits 1,406,928 43,679 3.10 % Federal funds purchased and repurchase agreements 200,894 5,203 2.59 % Borrowings 4 500,301 26,881 5.37 % Junior subordinated debt issued to unconsolidated trusts 71,894 3,853 5.36 % Total interest-bearing liabilities 7,825,459 $ 159,922 2.04 % Net interest spread 1 2.28 % Noninterest-bearing deposits 3,018,563 Other liabilities 204,685 Stockholders’ equity 1,197,511 Total liabilities and stockholders’ equity $ 12,246,218 Interest income / earning assets 1, 3 $ 11,181,010 $ 482,716 4.32 % Interest expense / earning assets 11,181,010 159,922 1.43 % Net interest margin 1 $ 322,794 2.89 % ___________________________________________ 1.
The ACL must be determined on a collective (pool) basis when similar risk characteristics exist. On a case-by-case basis, Busey may conclude that a loan should be evaluated on an individual basis based on disparate risk characteristics. Loans deemed uncollectible are charged against and reduce the ACL.
The ACL must be determined on a collective (pool) basis when similar risk characteristics exist. On a case-by-case basis, Busey may conclude that a loan should be evaluated on an individual basis based on disparate risk characteristics. Loans deemed uncollectible are charged-off against and reduce the ACL.
Management applies significant judgement when testing goodwill for impairment, such as the valuation approach chosen, market multiples for competitors used in the calculation, and forecasts of business outlook. Income Taxes Busey is subject to the income tax laws of U.S., as well as the tax laws of the individual states and municipalities in which the Company conducts its operations.
Management applies significant judgment when testing goodwill for impairment, such as the valuation approach chosen, market multiples for competitors used in the calculation, and forecasts of business outlook. Income Taxes Busey is subject to the income tax laws of the U.S., as well as the tax laws of the individual states and municipalities in which the Company conducts its operations.
Goodwill Goodwill represents the excess of purchase price over the fair value of net assets acquired using the acquisition method of accounting. Goodwill is not amortized; instead, Busey assesses the potential for impairment on an annual basis or more frequently if events and circumstances indicate that goodwill might be impaired.
MD&A Goodwill Goodwill represents the excess of the purchase price over the fair value of net assets acquired using the acquisition method of accounting. Goodwill is not amortized; instead, Busey assesses the potential for impairment on an annual basis or more frequently if events and circumstances indicate that goodwill might be impaired.
MD&A Critical accounting estimates are those that are critical to the portrayal and understanding of Busey’s financial condition and results of operations and require management to make assumptions that are subjective or complex. These estimates involve judgments, assumptions, and uncertainties that are susceptible to change.
Critical accounting estimates are those that are critical to the portrayal and understanding of Busey’s financial condition and results of operations and require management to make assumptions that are subjective or complex. These estimates involve judgments, assumptions, and uncertainties that are susceptible to change.
Net interest spread represents the difference between the average rate earned on earning assets and the average rate paid on interest-bearing liabilities, and is presented in the table below for the periods indicated: Years Ended December 31, 2024 2023 2022 Net interest spread 1 2.19 % 2.28 % 2.68 % ___________________________________________ 1. Calculated on a tax-equivalent basis.
Net interest spread represents the difference between the average rate earned on earning assets and the average rate paid on interest-bearing liabilities, and is presented in the table below for the periods indicated: Years Ended December 31, 2025 2024 2023 Net interest spread 1 2.73 % 2.19 % 2.28 % ___________________________________________ 1. Calculated on a tax-equivalent basis.
The allowance for PCD loans is recorded through a gross-up effect, while the allowance for acquired non-PCD loans is recorded through provision expense, consistent with originated loans. Thus, the determination of which loans are PCD and non-PCD can have a significant effect on the accounting for these loans.
The allowance for PCD loans is recorded through a gross-up effect, while the allowance for acquired non-PCD loans is recorded through provision expense, consistent with originated loans. Thus, the determination of which loans are PCD and non-PCD can have a significant effect on the accounting for these loans. 1 Core deposits is a non-GAAP financial measure.
Business—Non-GAAP Financial Information . ” Net Interest Income Net interest income is the difference between interest income and fees earned on loans and investments (“interest-earning assets”) and interest expense incurred on deposits and borrowings (“interest-bearing liabilities”). Interest rate levels and volume fluctuations within interest-earning assets and interest-bearing liabilities impact net interest income.
Net Interest Income Net interest income is the difference between interest income and fees earned on loans and investments (“interest-earning assets”) and interest expense incurred on deposits and borrowings (“interest-bearing liabilities”). Interest rate levels and volume fluctuations within interest-earning assets and interest-bearing liabilities impact net interest income.
Annualized net interest margins for the quarterly periods indicated were as follows: 2024 2023 2022 First Quarter 2.79 % 3.13 % 2.45 % Second Quarter 3.03 % 2.86 % 2.68 % Third Quarter 3.02 % 2.81 % 3.00 % Fourth Quarter 2.95 % 2.75 % 3.24 % Management attempts to mitigate the effects of an unpredictable interest-rate environment through effective portfolio management, prudent loan underwriting and pricing discipline, and operational efficiencies.
Annualized net interest margins for the quarterly periods indicated were as follows: 2025 2024 2023 First Quarter 3.16 % 2.79 % 3.13 % Second Quarter 3.49 % 3.03 % 2.86 % Third Quarter 3.58 % 3.02 % 2.81 % Fourth Quarter 3.71 % 2.95 % 2.75 % Management attempts to mitigate the effects of an unpredictable interest-rate environment through effective portfolio management, prudent loan underwriting and pricing discipline, and operational efficiencies.
First Busey Corporation (BUSE) | 2024 — 57 Table of Contents Contents of Item 7. MD&A The following table presents, for the major components of interest-earning assets and interest-bearing liabilities, a breakout of changes in interest income and interest expense attributable to (1) changes in average volume and (2) changes in average yield.
First Busey Corporation (BUSE) | 2025 — 63 Table of Contents Contents of Item 7. MD&A The following tables present, for the major components of interest-earning assets and interest-bearing liabilities, a breakout of changes in interest income and interest expense attributable to (1) changes in average volume and (2) changes in average yield.
A reconciliation of non-GAAP measures, which Busey believes facilitates the assessment of its financial results and peer comparability, is included in tabular form in this Annual Report. See “ Item 1.
A reconciliation of non-GAAP measures, which Busey believes facilitates the assessment of its financial results and peer comparability, is included in tabular form in this Annual Report. See “ Item 1. Business—Non-GAAP Financial Information . ” First Busey Corporation (BUSE) | 2025 — 58 Table of Contents Contents of Item 7.
Business ,” the Consolidated Financial Statements , and the related Notes to the Consolidated Financial Statements included in this Annual Report. Detailed discussion and analysis of Busey’s financial condition and results of operation for 2024 as compared to 2023 can be found below. Comparison of 2023 to 2022 can be found in “ Item 7.
It should be read in conjunction with “ Item 1. Business ,” the Consolidated Financial Statements , and the related Notes to the Consolidated Financial Statements included in this Annual Report. Detailed discussion and analysis of Busey’s financial condition and results of operation for 2025 as compared to 2024 can be found below.
For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately, based on changes due to rate and changes due to volume (dollars in thousands) : Years Ended December 31, 2024 vs. 2023 Change Due To 2023 vs. 2022 Change Due To Average Volume Average Yield/Rate Total Change Average Volume Average Yield/Rate Total Change Increase (decrease) in interest income Interest-bearing bank deposits and federal funds sold $ 11,643 $ 267 $ 11,910 $ (1,013) $ 8,447 $ 7,434 Investment securities: U.S.
For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately, based on changes due to rate and changes due to volume: Years Ended December 31, 2025 vs. 2024 Change Due To (dollars in thousands) Average Volume Average Yield/Rate Total Change Increase (decrease) in interest income Interest-bearing bank deposits and federal funds sold $ 5,891 $ (3,699) $ 2,192 Investment securities: U.S.
Busey executed a two-part balance sheet repositioning strategy in 2024 During the first quarter of 2024, Busey sold the mortgage servicing rights on approximately $923.5 million of one- to four-family mortgage loans for a pre-tax gain of $7.7 million, which enabled Busey to sell available-for-sale investment securities with a book value of approximately $108.2 million for a pre-tax loss of $6.8 million with no resulting negative impact to tangible capital.
During the year ended December 31, 2024, Busey executed a two-part balance sheet repositioning strategy in which it sold mortgage servicing rights on approximately $923.5 million of one-to-four family mortgage loans for a pre-tax gain of $7.7 million and sold available-for-sale debt securities with a book value of approximately $108.2 million for a pre-tax loss of $6.8 million. 2.
At December 31, 2024, Busey’s leverage ratio of Tier 1 capital to average assets was 11.1%, its common equity Tier 1 capital to risk weighted assets ratio was 14.1%, and its total capital to risk weighted assets ratio was 18.5%.
At December 31, 2025, Busey’s leverage ratio of Tier 1 capital to average assets was 11.9%, its common equity Tier 1 capital to risk weighted assets ratio was 12.4%, and its total capital to risk weighted assets ratio was 15.9%.
First Busey Corporation (BUSE) | 2024 — 61 Table of Contents Contents of Item 7.
First Busey Corporation (BUSE) | 2025 — 66 Table of Contents Contents of Item 7.
Operating costs have been influenced by acquisition expenses and other restructuring costs, and the adjusted efficiency ratio 3 was 61.0% for the year ended December 31, 2024, compared to 60.7% for the year ended December 31, 2023. 3 The efficiency ratio and adjusted efficiency ratio are both non-GAAP financial measures.
Operating costs have been influenced by acquisition expenses and other restructuring costs, and the adjusted efficiency ratio 3 was 55.8% for the year ended December 31, 2025, compared to 61.3% for the year ended December 31, 2024.
Management’s Discussion and Analysis of Financial Condition and Results of Operations (Unaudited) (“MD&A”) SCOPE OF DISCUSSION 52 BUSEY’S CONSERVATIVE BANKING STRATEGY 52 Busey executed a two-part balance sheet repositioning strategy in 2024 52 CRITICAL ACCOUNTING ESTIMATES 52 Fair Value of Assets Acquired and Liabilities Assumed in Business Combinations 53 Goodwill 53 Income Taxes 53 Allowance for Credit Losses 54 RESULTS OF OPERATIONS — THREE YEARS ENDED DECEMBER 31, 2024 55 Net Income 55 Operating Performance Metrics 55 Net Interest Income 56 Noninterest Income 60 Noninterest Expense 62 Efficiency Ratio 63 Income Taxes 64 FINANCIAL CONDITION 65 Balance Sheet 65 Investment Securities 65 Portfolio Loans 69 Deposits 79 Borrowings 80 Liquidity 83 Off-Balance-Sheet Arrangements 84 Contractual Obligations 84 Cash Flows 85 Capital Resources 86 NEW ACCOUNTING PRONOUNCEMENTS 86 EFFECTS OF INFLATION 86 First Busey Corporation (BUSE) | 2024 — 51 Table of Contents Contents of Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations (Unaudited) (“MD&A”) SCOPE OF DISCUSSION 53 BUSEY’S CONSERVATIVE BANKING STRATEGY 54 CRITICAL ACCOUNTING ESTIMATES 54 Fair Value of Assets Acquired and Liabilities Assumed in Business Combinations 54 Goodwill 55 Income Taxes 55 Allowance for Credit Losses 55 RESULTS OF OPERATIONS — THREE YEARS ENDED DECEMBER 31, 2025 57 Net Income 57 Non-GAAP Adjusting Items and Non-GAAP Measures 58 Operating Performance Metrics 59 Net Interest Income 59 Noninterest Income 67 Noninterest Expense 69 Efficiency Ratio 70 Income Taxes 70 FINANCIAL CONDITION 71 Balance Sheet 71 Investment Securities 71 Portfolio Loans 74 Deposits 83 Borrowings 84 Liquidity 85 Off-Balance-Sheet Arrangements 86 Contractual Obligations 87 Cash Flows 87 Capital Resources 88 NEW ACCOUNTING PRONOUNCEMENTS 88 EFFECTS OF INFLATION 88 SCOPE OF DISCUSSION The following is management’s discussion and analysis of the financial condition as of December 31, 2025, and 2024, and the results of operations for the years ended December 31, 2025, 2024, and 2023, of First Busey Corporation and its subsidiaries.
Busey must also make estimates about when in the future certain items will affect taxable income. Disputes over interpretations of the tax laws may be subject to review and adjudication by the court systems of the various tax jurisdictions or may be settled with the taxing authority upon examination or audit.
Disputes over interpretations of the tax laws may be subject to review and adjudication by the court systems of the various tax jurisdictions or may be settled with the taxing authority upon examination or audit.
Significant Accounting Policies ” in the Notes to the Consolidated Financial Statements . 1 Core deposits is a non-GAAP financial measure. For a reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures, see “ Item 1. Business—Non-GAAP Financial Information. ” First Busey Corporation (BUSE) | 2024 — 52 Table of Contents Contents of Item 7.
For a reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures, see “ Item 1. Business—Non-GAAP Financial Information. ” First Busey Corporation (BUSE) | 2025 — 54 Table of Contents Contents of Item 7.
Consolidated Average Balance Sheets and Interest Rates The table below presents Busey’s Consolidated Average Balance Sheets, detailing average balances for each major category of assets and liabilities, the interest income earned on interest-earning assets, the interest expense paid for interest-bearing liabilities, and the related interest yields for the periods indicated.
First Busey Corporation (BUSE) | 2025 — 59 Table of Contents Contents of Item 7. MD&A The tables below present Busey’s Consolidated Average Balance Sheets, summarizing average balances for each major category of assets and liabilities, the interest income earned on interest-earning assets, the interest expense paid for interest-bearing liabilities, and the related interest yields for the periods indicated.
Estimated income tax expense is reported on the Consolidated Statements of Income . First Busey Corporation (BUSE) | 2024 — 53 Table of Contents Contents of Item 7. MD&A In establishing its provision for income taxes and its estimates of deferred tax assets and liabilities, Busey must make judgments and interpretations about the application of inherently complex tax laws.
Estimated income tax expense is reported on the Consolidated Statements of Income . In establishing its provision for income taxes and its estimates of deferred tax assets and liabilities, Busey must make judgments and interpretations about the application of inherently complex tax laws. Busey must also make estimates about when in the future certain items will affect taxable income.
Wealth management fees increased by 11.0% to $63.6 million in 2024, compared to $57.3 million in 2023. Busey’s Wealth Management division had $13.83 billion in assets under care as of December 31, 2024, compared to $12.14 billion as of December 31, 2023.
Wealth management fees increased by 9.1% to $69.4 million for 2025, compared to $63.6 million for 2024. Busey’s Wealth Management division had $15.66 billion in assets under care as of December 31, 2025, compared to $13.83 billion as of December 31, 2024.
A realized gain on the sale of mortgage servicing rights of $7.7 million was recognized in connection with Busey’s strategic two-part balance sheet repositioning completed during 2024.
During the year ended December 31, 2025, Busey did not record any realized gains on the sale of mortgage servicing rights. In comparison, during the year ended December 31, 2024, Busey recognized a $7.7 million gain on the sale of mortgage servicing rights in connection with a strategic two-part balance sheet repositioning.
Income on bank owned life insurance increased by 9.1% to $5.1 million in 2024, compared to $4.7 million in 2023, resulting from a $0.1 million increase in earnings on death proceeds and a $0.3 million increase in the cash surrender value of the insurance policies.
General economic conditions and interest rate volatility may impact future mortgage revenue. Income on bank owned life insurance increased by 28.6% to $6.6 million for 2025, compared to $5.1 million for 2024, resulting from a $1.9 million increase in the cash surrender value of the insurance policies partially offset by a $0.4 million decrease in earnings on death proceeds.
In addition, as a matter of both policy and practice, Busey limits concentration exposures in any particular loan segment. As a result, asset quality remains strong by both Busey’s historical and current industry trends. Busey’s conservative banking strategy is reflected in the strength of its capital base.
While impacted by loans acquired as a result of the CrossFirst acquisition, asset quality remains strong by both Busey’s historical and current industry trends. Busey’s conservative banking strategy is reflected in the strength of its capital base.
For a reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures, see “
For a reconciliation of non-GAAP measures to the most directly comparable GAAP financial measures, see “ Item 1. Business—Non-GAAP Financial Information ” included in this Annual Report. 2.
These factors include economic conditions, collateral, concentrations, delinquency trends, portfolio composition, underwriting, and certain other risks. Significant downturns relating to loan quality and economic conditions could result in a requirement for an additional allowance. Likewise, an upturn in loan quality and improved economic conditions may allow for a reduction in the required allowance.
Further, Busey completes a quarterly evaluation of several qualitative factors to determine if there should be adjustments made to the ACL. These factors include economic conditions, collateral, concentrations, delinquency trends, portfolio composition, underwriting, and certain other risks. Significant downturns relating to loan quality and economic conditions could result in a requirement for an additional allowance.
Busey’s portfolio management team continues to focus on long-term returns and managing risk in the face of volatile markets. Payment technology solutions revenue relates to Busey’s payment processing company, FirsTech. Payment technology solutions revenue increased by 3.7% to $22.0 million in 2024, compared to $21.2 million in 2023.
Busey’s portfolio management team continues to focus on long-term returns and managing risk in the face of volatile markets. Income from payment technology solutions derives from Busey’s payment processing company, FirsTech. This income decreased by 9.0% to $20.0 million for 2025, compared to $22.0 million for 2024, primarily due to decreases in income from online bill payments.
At the time of the sale, the securities sold yielded a weighted average rate of 1.98% and had a weighted-average life of 2.3 years. CRITICAL ACCOUNTING ESTIMATES Busey has established various accounting policies that govern the application of GAAP in the preparation of its Consolidated Financial Statements . Significant accounting policies are described in “ Note 1.
CRITICAL ACCOUNTING ESTIMATES Busey has established various accounting policies that govern the application of GAAP in the preparation of its Consolidated Financial Statements . Significant accounting policies are described in “ Note 1. Significant Accounting Policies ” in the Notes to the Consolidated Financial Statements .
On a tax-equivalent basis, assuming a federal income tax rate of 21.0%. 2. Non-accrual loans have been included in average portfolio loans. 3. Interest income includes tax-equivalent adjustments of $1.7 million for 2024, $2.2 million for each of 2023 and 2022.
On a tax-equivalent basis, assuming a federal income tax rate of 21.0%. 2. Non-accrual loans have been included in average portfolio loans. 3. Interest income includes tax-equivalent adjustments of $1.7 million. 4. Borrowings include, as applicable, short-term borrowings, long-term borrowings, senior notes, and subordinated notes. Interest expense includes a non-usage fee on the revolving credit facility.
Interchange expense decreased to $6.0 million in 2024, compared to $6.9 million in 2023. Fluctuations in interchange expense relate to payment and volume activity at FirsTech. FDIC insurance expense decreased to $5.6 million in 2024, compared to $5.7 million in 2023. Other expense decreased to $37.6 million in 2024, compared to $44.2 million in 2023.
Busey uses an accelerated amortization methodology. Interchange expense decreased to $5.2 million for 2025, compared to $6.0 million for 2024. Fluctuations in interchange expense relate to payment and volume activity at FirsTech. FDIC insurance expense increased to $10.4 million for 2025, compared to $5.6 million for 2024.
Because of the nature of the judgments and assumptions made by management, actual results may differ from these judgments and assumptions. First Busey Corporation (BUSE) | 2024 — 54 Table of Contents Contents of Item 7.
Likewise, an upturn in loan quality and improved economic conditions may allow for a reduction in the required allowance. Because of the nature of the judgments and assumptions made by management, actual results may differ from these judgments and assumptions. First Busey Corporation (BUSE) | 2025 — 56 Table of Contents Contents of Item 7.
A provision for credit losses is charged to current expense and acts to replenish the ACL in order to maintain the ACL at a level that management deems adequate. Determining the ACL involves significant judgments and assumptions. Macroeconomic forecasts provided by a third party and the economic indices sourced are significant judgments used in determining the allowance.
A provision for credit losses is charged to current expense and acts to replenish the ACL in order to maintain the ACL at a level that management deems adequate. First Busey Corporation (BUSE) | 2025 — 55 Table of Contents Contents of Item 7. MD&A Determining the ACL involves significant judgments and assumptions.
Management’s Discussion and Analysis of Financial Condition and Results of Operations ” of Busey's 2023 Annual Report . BUSEY’S CONSERVATIVE BANKING STRATEGY Busey’s financial strength is built on a long-term conservative operating approach. The quality of Busey’s core deposit franchise is a critical value driver of the institution.
MD&A BUSEY’S CONSERVATIVE BANKING STRATEGY Busey’s financial strength is built on a long-term conservative operating approach. The quality of Busey’s core deposit 1 franchise is a critical value driver of the institution. Busey remains substantially core deposit funded, with robust liquidity.
Business—Non-GAAP Financial Information .” Total noninterest expense increased to $300.4 million for the year ended December 31, 2024, compared to $285.5 million for the year ended December 31, 2023, representing a year-over-year increase of 5.2%. Non-operating acquisition and other restructuring expenses increased to $8.1 million in 2024, compared to $4.3 million in 2023.
For a reconciliation of non-GAAP measures to the most directly comparable GAAP financial measures, see “ Item 1. Business—Non-GAAP Financial Information ” included in the Annual Report. Total noninterest expense increased to $480.2 million for the year ended December 31, 2025, compared to $301.5 million for the year ended December 31, 2024, representing a year-over-year increase of 59.3%.
Combined, net occupancy expense of premises and furniture and equipment expenses increased to $25.5 million in 2024, compared to $25.0 million in 2023. Primary cost drivers in these expense categories include lease costs, repairs and maintenance, depreciation expense, real estate taxes, and utilities. Professional fees increased to $12.8 million in 2024, compared to $7.1 million in 2023.
Primary cost drivers in these expense categories include lease costs, repairs and maintenance, depreciation expense, real estate taxes, and utilities. Professional fees increased to $18.8 million for 2025, compared to $12.8 million for 2024. Excluding acquisition and restructuring expenses, professional fees were $10.7 million for 2025, compared to $7.9 million for 2024, representing an increase of 35.3%.
MD&A Noninterest Expense Changes in noninterest expense are summarized in the tables below for the periods presented (dollars in thousands) : Years Ended December 31, 2024 2023 Change % Change Noninterest expense Salaries, wages, and employee benefits $ 175,619 $ 162,597 $ 13,022 8.0 % Data processing 27,124 23,708 3,416 14.4 % Premises expenses: Net occupancy expense of premises 18,737 18,214 523 2.9 % Furniture and equipment expenses 6,805 6,759 46 0.7 % Combined, net occupancy expense of premises and furniture and equipment expenses 25,542 24,973 569 2.3 % Professional fees 12,804 7,147 5,657 79.2 % Amortization of intangible assets 10,057 10,432 (375) (3.6) % Interchange expense 6,001 6,864 (863) (12.6) % FDIC insurance 5,603 5,650 (47) (0.8) % Other noninterest expense 37,649 44,161 (6,512) (14.7) % Total noninterest expense $ 300,399 $ 285,532 $ 14,867 5.2 % Income taxes $ 39,613 $ 31,339 $ 8,274 26.4 % Effective income tax rate 25.8 % 20.4 % 540 bps Efficiency ratio (Non-GAAP) 1 61.8 % 61.7 % 10 bps Adjusted efficiency ratio (Non-GAAP) 1 61.0 % 60.7 % 30 bps Full-time equivalent associates as of period-end 1,509 1,479 30 2.0 % ___________________________________________ 1.
MD&A Noninterest Expense Changes in noninterest expense are summarized in the tables below for the periods presented: Years Ended December 31, (dollars in thousands) 2025 2024 Change % Change Noninterest expense Salaries, wages, and employee benefits $ 289,063 $ 175,619 $ 113,444 64.6 % Data processing 43,181 27,124 16,057 59.2 % Premises expenses: Net occupancy expense of premises 29,490 18,737 10,753 57.4 % Furniture and equipment expenses 8,496 6,805 1,691 24.8 % Combined, net occupancy expense of premises and furniture and equipment expenses 37,986 25,542 12,444 48.7 % Professional fees 18,807 12,804 6,003 46.9 % Amortization of intangible assets 16,614 10,057 6,557 65.2 % Interchange expense 5,194 6,001 (807) (13.4) % FDIC insurance 10,397 5,603 4,794 85.6 % Other noninterest expense 58,959 38,744 20,215 52.2 % Total noninterest expense $ 480,201 $ 301,494 $ 178,707 59.3 % Income taxes $ 51,378 $ 39,613 $ 11,765 29.7 % Effective income tax rate 27.5 % 25.8 % 170 bps Efficiency ratio (Non-GAAP) 1 63.2 % 62.0 % 120 bps Adjusted efficiency ratio (Non-GAAP) 1 55.8 % 61.3 % (550) bps Full-time equivalent associates as of period-end 1,914 1,509 405 26.8 % ___________________________________________ 1.
Government obligations (919) 499 (420) (691) 190 (501) Obligations of state and political subdivisions (2,259) 37 (2,222) (1,466) 415 (1,051) Other securities (8,350) 1,568 (6,782) (8,026) 23,003 14,977 Restricted bank stock (132) (190) (322) 482 499 981 Loans held for sale 384 3 387 (161) 85 (76) Portfolio loans 2,266 37,841 40,107 12,598 85,980 98,578 Change in interest income 2,633 40,025 42,658 1,723 118,619 120,342 Increase (decrease) in interest expense Interest-bearing transaction deposits (5,029) 4,686 (343) (27) 36,145 36,118 Savings and money market deposits 3,489 34,009 37,498 (752) 33,553 32,801 Time deposits 5,985 11,338 17,323 4,932 34,022 38,954 Federal funds purchased and repurchase agreements (1,489) 594 (895) (304) 4,032 3,728 Borrowings (16,737) 3,507 (13,230) 9,485 1,464 10,949 Junior subordinated debt owed to unconsolidated trusts 118 677 795 8 816 824 Change in interest expense (13,663) 54,811 41,148 13,342 110,032 123,374 Increase (decrease) in net interest income $ 16,296 $ (14,786) $ 1,510 $ (11,619) $ 8,587 $ (3,032) Percentage increase (decrease) in net interest income over prior period 0.5 % (0.9) % First Busey Corporation (BUSE) | 2024 — 58 Table of Contents Contents of Item 7.
Government obligations (919) 499 (420) Obligations of state and political subdivisions (2,259) 37 (2,222) Other securities (8,350) 1,568 (6,782) Restricted bank stock (132) (190) (322) Loans held for sale 384 3 387 Portfolio loans 2,266 37,841 40,107 Change in interest income 2,633 40,025 42,658 Increase (decrease) in interest expense Interest-bearing transaction deposits (5,029) 4,686 (343) Savings and money market deposits 3,489 34,009 37,498 Time deposits 5,985 11,338 17,323 Federal funds purchased and repurchase agreements (1,489) 594 (895) Borrowings (16,737) 3,507 (13,230) Junior subordinated debt owed to unconsolidated trusts 118 677 795 Change in interest expense (13,663) 54,811 41,148 Increase (decrease) in net interest income $ 16,296 $ (14,786) $ 1,510 Percentage increase (decrease) in net interest income over prior period 0.5 % Notable changes in average assets and average liabilities are summarized as follows for the periods presented: Years Ended December 31, (dollars in thousands) 2025 2024 Change % Change Average interest-earning assets $ 16,331,740 $ 10,999,424 $ 5,332,316 48.5 % Average interest-bearing liabilities 11,755,014 7,763,084 3,991,930 51.4 % Average noninterest-bearing deposits 3,450,226 2,738,892 711,334 26.0 % Total average deposits 14,736,283 10,040,016 4,696,267 46.8 % Total average liabilities 15,449,428 10,709,447 4,739,981 44.3 % Average noninterest-bearing deposits as a percent of total average deposits 23.4 % 27.3 % (390) bps Total average deposits as a percent of total average liabilities 95.4 % 93.7 % 170 bps First Busey Corporation (BUSE) | 2025 — 65 Table of Contents Contents of Item 7.
Busey remains substantially core deposit 1 funded, with robust liquidity and significant market share in the communities Busey serves. As of December 31, 2024, Busey’s loan to deposit ratio was 77.1% and core deposits 1 represented 96.5% of total deposits. Furthermore, Busey has sufficient on- and off-balance sheet liquidity to manage deposit fluctuations and the liquidity needs of its customers.
As of December 31, 2025, Busey’s loan to deposit ratio was 91.0% and core deposits 1 represented 93.7% of total deposits. Furthermore, Busey has sufficient on- and off-balance sheet liquidity to manage deposit fluctuations and the liquidity needs of its customers. Busey’s credit performance reflects its highly diversified, conservatively underwritten loan portfolio.
MD&A Years Ended December 31, 2024 2023 2022 Average Balance Income/ Expense Yield/ Rate Average Balance Income/ Expense Yield/ Rate Average Balance Income/ Expense Yield/ Rate Assets Interest-bearing bank deposits and federal funds sold $ 445,881 $ 22,441 5.03 % $ 214,422 $ 10,531 4.91 % $ 290,875 $ 3,097 1.06 % Investment securities: U.S.
First Busey Corporation (BUSE) | 2025 — 61 Table of Contents Contents of Item 7. MD&A Year Ended December 31, 2024 (dollars in thousands) Average Balance Income/ Expense Yield/ Rate Assets Interest-bearing bank deposits and federal funds sold $ 445,881 $ 22,441 5.03 % Investment securities: U.S.
Changes in these economic forecasts could significantly affect the ACL and lead to materially different amounts from one period to the next. Additionally, prepayment assumptions impact model output. Further, Busey completes a quarterly evaluation of several qualitative factors to determine if there should be adjustments made to the ACL.
Macroeconomic forecasts provided by a third party and the economic indices sourced are significant judgments used in determining the allowance. Changes in these economic forecasts could significantly affect the ACL and lead to materially different amounts from one period to the next. Additionally, prepayment assumptions impact model output.
Non-operating pretax adjustments were as follows for the periods presented (dollars in thousands) : Years Ended December 31, 2024 2023 2022 Non-operating expenses Salaries, wages, and employee benefits $ 1,580 $ 3,760 $ 2,996 Data processing 548 — 214 Net occupancy expense of premises and furniture and equipment expenses 134 — — Professional fees 4,891 435 312 Other noninterest expense 987 133 1,015 Total non-operating expenses $ 8,140 $ 4,328 $ 4,537 Non-operating expenses by business objective Acquisition expenses 1 $ 6,901 $ 357 $ 1,059 Restructuring expenses 2 1,239 3,971 3,478 Acquisition and restructuring expenses $ 8,140 $ 4,328 $ 4,537 ___________________________________________ 1.
Pre-tax non-GAAP adjustments were as follows: Years Ended December 31, (dollars in thousands) 2025 2024 2023 Pre-tax non-GAAP adjusting items by income/expense category Realized net (gains) losses on the sale of mortgage servicing rights $ — $ (7,724) $ — Net securities (gains) losses 10,726 6,102 2,199 Other noninterest income 44 — — Provision for credit losses 49,602 — — Salaries, wages, and employee benefits 37,072 1,580 3,760 Data processing 6,984 548 — Net occupancy expense of premises 13 46 — Furniture and equipment expenses 67 88 — Professional fees 8,100 4,891 435 Other noninterest expense 2,413 987 133 Total pre-tax non-GAAP adjustments $ 115,021 $ 6,518 $ 6,527 Non-GAAP adjusting items by business objective Balance sheet repositioning 1 $ — $ (7,724) $ — Net securities (gains) losses 1 10,726 6,102 2,199 Initial provision for credit losses 2 49,602 — — Other acquisition (income) expenses 3 54,736 6,901 357 Restructuring expenses 4 (43) 1,239 3,971 Total pre-tax non-GAAP adjustments $ 115,021 $ 6,518 $ 6,527 ___________________________________________ 1.
MD&A RESULTS OF OPERATIONS — THREE YEARS ENDED DECEMBER 31, 2024 Net Income Results of Busey’s operations are presented below, segregated by operating segment (dollars in thousands) : Years Ended December 31, 2024 2023 2022 Net income Banking $ 117,266 $ 123,853 $ 131,596 Wealth Management 22,030 18,804 18,543 FirsTech (670) 830 847 Other (24,935) (20,922) (22,675) Net income $ 113,691 $ 122,565 $ 128,311 Operating Performance Metrics Operating performance metrics presented in the table below have been derived from information used by management to monitor and manage Busey’s financial performance (dollars in thousands, except per share amounts) : Years Ended December 31, 2024 2023 2022 Net income $ 113,691 $ 122,565 $ 128,311 Adjusted net income (Non-GAAP) 1 119,805 126,012 131,910 Diluted earnings per common share $ 1.98 $ 2.18 $ 2.29 Adjusted diluted earnings per common share (Non-GAAP) 1 2.08 2.24 2.35 Return on average assets 0.94 % 1.00 % 1.03 % Adjusted return on average assets (Non-GAAP) 1 0.99 % 1.03 % 1.06 % Return on average tangible common equity (Non-GAAP) 1 11.65 % 14.62 % 15.56 % Adjusted return on average tangible common equity (Non-GAAP) 1 12.28 % 15.03 % 15.99 % Pre-provision net revenue (Non-GAAP) 1 $ 167,996 $ 158,502 $ 168,493 Adjusted pre-provision net revenue (Non-GAAP) 1 167,317 172,290 179,424 Pre-provision net revenue to average total assets (Non-GAAP) 1 1.39 % 1.29 % 1.35 % Adjusted pre-provision net revenue to average total assets (Non-GAAP) 1 1.39 % 1.41 % 1.44 % ___________________________________________ 1.
MD&A Operating Performance Metrics Operating performance metrics presented in the table below have been derived from information used by management to monitor and manage Busey’s financial performance: Years Ended December 31, (dollars in thousands, except per share amounts) 2025 2024 2023 Net income (GAAP) $ 135,262 $ 113,691 $ 122,565 Adjusted net income (Non-GAAP) 1, 2 $ 224,974 $ 120,033 $ 127,763 Net income available to common stockholders (GAAP) $ 125,386 $ 113,691 $ 122,565 Adjusted net income available to common stockholders (Non-GAAP) 1 $ 215,098 $ 120,033 $ 127,763 Diluted earnings per common share $ 1.47 $ 1.98 $ 2.18 Adjusted diluted earnings per common share (Non-GAAP) 1, 2 $ 2.53 $ 2.09 $ 2.27 Return on average assets 0.76 % 0.94 % 1.00 % Adjusted return on average assets (Non-GAAP) 1, 2 1.27 % 1.00 % 1.04 % Return on average tangible common equity (Non-GAAP) 1 7.48 % 11.65 % 14.62 % Adjusted return on average tangible common equity (Non-GAAP) 1, 2 12.83 % 12.30 % 15.24 % Pre-provision net revenue (Non-GAAP) 1, 3 $ 250,109 $ 166,901 $ 158,963 Adjusted pre-provision net revenue (Non-GAAP) 1, 3 $ 304,802 $ 167,317 $ 172,290 Pre-provision net revenue to average total assets (Non-GAAP) 1, 3 1.41 % 1.38 % 1.30 % Adjusted pre-provision net revenue to average total assets (Non-GAAP) 1, 3 1.72 % 1.39 % 1.41 % ___________________________________________ 1.
Results for 2024 marked a new record high reported annual revenue for FirsTech. Combined, revenues from wealth management fees and payment technology solutions represented 61.3% and 64.8% of Busey’s noninterest income for the years ended December 31, 2024, and December 31, 2023, respectively, providing a complement to spread-based revenue from traditional banking activities.
Total noninterest income represented 20.8% of total revenue 2 in 2025, compared to 30.2% in 2024. The year ended December 31, 2025, includes ten months of income from the CrossFirst acquisition. Revenues from wealth management fees and payment technology solutions provide a complement to spread-based revenue from traditional banking activities.
Efficiency Ratio The efficiency ratio 3 is calculated as total noninterest expense, less amortization charges, as a percentage of tax-equivalent net interest income plus noninterest income, less security gains and losses. The efficiency ratio, which is a measure commonly used by management and the banking industry, measures the amount of expense incurred to generate a dollar of revenue.
Increases in other noninterest expense were attributable to multiple items, including increased costs on loans, marketing, business development, and office supplies. Efficiency Ratio The efficiency ratio 3 is calculated as total noninterest expense, less amortization charges, as a percentage of tax-equivalent net interest income plus noninterest income, less security gains and losses.
The efficiency ratio and adjusted efficiency ratio are both non-GAAP financial measures. For a reconciliation of non-GAAP financial measure to the most directly comparable GAAP financial measures, see “ Item 1.
As such, there was a significant rate change adjustment recognized against deferred tax assets in 2025, which increased Busey's effective tax rate for the year ended December 31, 2025. 3 The efficiency ratio and adjusted efficiency ratio are both non-GAAP financial measures. For a reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures, see “
Noninterest Income Changes in noninterest income are summarized in the tables below for the periods presented (dollars in thousands) : Years Ended December 31, 2024 2023 Change % Change Noninterest income Wealth management and payment technology solutions income: Wealth management fees $ 63,630 $ 57,309 $ 6,321 11.0 % Payment technology solutions 21,983 21,192 791 3.7 % Combined, wealth management fees and payment technology solutions 85,613 78,501 7,112 9.1 % Fees for customer services 30,933 29,044 1,889 6.5 % Mortgage revenue 2,075 1,089 986 90.5 % Income on bank owned life insurance 5,130 4,701 429 9.1 % Realized net gains (losses) on the sale of mortgage servicing rights 7,724 — 7,724 100.0 % Securities income: Realized net gains (losses) on securities (7,033) (28) (7,005) NM Unrealized net gains (losses) recognized on equity securities 931 (2,171) 3,102 142.9 % Net securities gains (losses) (6,102) (2,199) (3,903) (177.5) % Other noninterest income 14,309 10,078 4,231 42.0 % Total noninterest income $ 139,682 $ 121,214 $ 18,468 15.2 % Assets under care as of period end $ 13,833,654 $ 12,136,869 $ 1,696,785 14.0 % First Busey Corporation (BUSE) | 2024 — 60 Table of Contents Contents of Item 7.
MD&A Noninterest Income Changes in noninterest income are summarized in the tables below for the periods presented: Years Ended December 31, (dollars in thousands) 2025 2024 Change % Change Noninterest income Wealth management fees $ 69,426 $ 63,630 $ 5,796 9.1 % Payment technology solutions 20,000 21,983 (1,983) (9.0) % Treasury management services 17,322 8,377 8,945 106.8 % Card services and ATM fees 18,048 13,424 4,624 34.4 % Other service charges on deposit accounts 6,281 9,440 (3,159) (33.5) % Mortgage revenue 2,565 2,075 490 23.6 % Income on bank owned life insurance 6,597 5,130 1,467 28.6 % Realized net gains (losses) on the sale of mortgage servicing rights — 7,724 (7,724) (100.0) % Securities income: Realized net gains (losses) on securities (15,242) (7,033) (8,209) (116.7) % Unrealized net gains (losses) recognized on equity securities 4,516 931 3,585 385.1 % Net securities gains (losses) (10,726) (6,102) (4,624) (75.8) % Other noninterest income 20,462 14,001 6,461 46.1 % Total noninterest income $ 149,975 $ 139,682 $ 10,293 7.4 % Assets under care as of period end $ 15,657,269 $ 13,833,654 $ 1,823,615 13.2 % Total noninterest income was $150.0 million for the year ended December 31, 2025, an increase of 7.4% when compared with $139.7 million for the year ended December 31, 2024.
Interest income includes an immaterial amount of fees, net of deferred costs, related to Paycheck Protection Program loans for 2024 and 2023, and $1.9 million for 2022. 4. Borrowings include short-term borrowings, long-term debt, senior notes, and subordinated notes. Interest expense includes a non-usage fee on the revolving credit facility.
On a tax-equivalent basis, assuming a federal income tax rate of 21.0%. 2. Non-accrual loans have been included in average portfolio loans. 3. Interest income includes tax-equivalent adjustments of $2.2 million. 4. Borrowings include short-term borrowings, long-term debt, senior notes, and subordinated notes. Interest expense includes a non-usage fee on the revolving credit facility.
See “ Item 1. Business—Non-GAAP Financial Information .” First Busey Corporation (BUSE) | 2024 — 55 Table of Contents Contents of Item 7. MD&A Non-Operating Expenses and Non-GAAP Measures Busey views certain non-operating items, such as acquisition-related expenses and restructuring charges, as adjustments to net income reported under GAAP.
MD&A Non-GAAP Adjusting Items and Non-GAAP Measures Busey views certain non-operating items, including acquisition-related expenses, restructuring charges, and nonrecurring strategic events, as adjustments to net income reported under GAAP. Busey also adjusts for net securities gains and losses to align with industry and research analyst reporting.
Acquisition expenses in 2024 were related to the acquisition of M&M, which was completed on April 1, 2024, as well as the planned merger with CrossFirst. For 2023, acquisition expenses were related to the then planned acquisition of M&M, as well as to exploratory costs.
Other acquisition expenses related to the acquisition of CrossFirst, which was completed on March 1, 2025, and the acquisition of M&M, which was completed on April 1, 2024. 4. Restructuring expenses were related to previously disclosed restructuring and efficiency plans and to corporate strategy advisement.
Average information is provided on a daily average basis (dollars in thousands) : First Busey Corporation (BUSE) | 2024 — 56 Table of Contents Contents of Item 7.
Average information is provided on a daily average basis: First Busey Corporation (BUSE) | 2025 — 60 Table of Contents Contents of Item 7. MD&A Year Ended December 31, 2025 (dollars in thousands) Average Balance Income/ Expense Yield/ Rate Assets Interest-bearing bank deposits and federal funds sold $ 575,781 $ 24,633 4.28 % Investment securities: U.S.
Current trends continue to reflect a competitive labor market, maintaining pressure on costs related to attracting and maintaining Busey’s skilled workforce. Data processing expense increased to $27.1 million in 2024, compared to $23.7 million in 2023. Increases were primarily attributable to Company-wide investments in technology enhancements, as well as inflation-driven price increases.
Excluding acquisition and restructuring expenses, data processing expense was $36.2 million for 2025, compared to $26.6 million for 2024, representing an increase of 36.2%. Increases were primarily attributable to Company-wide investments in technology enhancements, as well as inflation-driven price increases.
Assuming a federal income tax rate of 21.0%. 2. Net interest income expressed as a percentage of average earning assets, stated on a tax-equivalent basis. After raising federal funds rates by a total of 525 bps between March 2022 and July 2023, the FOMC lowered rates by 100 bps beginning in September 2024.
Assuming a federal income tax rate of 21.0%. 2. Net interest income expressed as a percentage of average earning assets, stated on a tax-equivalent basis. Busey continues to evaluate and execute off-balance sheet hedging and balance sheet strategies as well as embedding rate protection in our asset originations to provide stabilization to net interest income in lower rate environments.
MD&A Notable changes in average assets and average liabilities are summarized as follows for the periods presented (dollars in thousands) : Years Ended December 31, 2024 2023 Change % Change Average interest-earning assets $ 10,999,424 $ 11,181,010 $ (181,586) (1.6) % Average interest-bearing liabilities 7,763,084 7,825,459 (62,375) (0.8) % Average noninterest-bearing deposits 2,738,892 3,018,563 (279,671) (9.3) % Total average deposits 10,040,016 10,070,933 (30,917) (0.3) % Total average liabilities 10,709,447 11,048,707 (339,260) (3.1) % Average noninterest-bearing deposits as a percent of total average deposits 27.3 % 30.0 % (270) bps Total average deposits as a percent of total average liabilities 93.7 % 91.2 % 250 bps Changes in net interest income and net interest margin are summarized as follows for the periods presented (dollars in thousands) : Years Ended December 31, 2024 2023 Change % Change Net interest income Interest income, on a tax-equivalent basis 1 $ 525,374 $ 482,716 $ 42,658 8.8 % Interest expense (201,070) (159,922) (41,148) (25.7) % Net interest income, on a tax-equivalent basis 1 $ 324,304 $ 322,794 $ 1,510 0.5 % Net interest margin 1, 2 2.95 % 2.89 % 6 bps ___________________________________________ 1.
MD&A Changes in net interest income and net interest margin are summarized as follows for the periods presented: Years Ended December 31, (dollars in thousands) 2025 2024 Change % Change Net interest income Interest income, on a tax-equivalent basis 1 $ 896,836 $ 525,374 $ 371,462 70.7 % Interest expense (324,251) (201,070) (123,181) (61.3) % Net interest income, on a tax-equivalent basis 1 $ 572,585 $ 324,304 $ 248,281 76.6 % Net interest margin 1, 2 3.51 % 2.95 % 56 bps ___________________________________________ 1.
Busey’s credit performance reflects its highly diversified, conservatively underwritten loan portfolio, which has been originated predominantly to established customers with tenured relationships with Busey. Busey’s approach to lending and its underwriting standards are designed to emphasize relationship banking rather than transactional banking.
Busey’s approach to lending and its underwriting standards are designed to emphasize relationship banking rather than transactional banking. In addition, as a matter of both policy and practice, Busey limits concentration exposures in any particular loan segment.
Removed
MD&A SCOPE OF DISCUSSION The following is management’s discussion and analysis of the financial condition as of December 31, 2024, and 2023, and the results of operations for the years ended December 31, 2024, 2023, and 2022, of First Busey Corporation and its subsidiaries. It should be read in conjunction with “ Item 1.
Added
Comparison of 2024 to 2023 can be found in “ Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations ” of Busey's 2024 Annual Report . First Busey Corporation (BUSE) | 2025 — 53 Table of Contents Contents of Item 7.
Removed
For 2022, acquisition expenses related to the integration of Cummins-American Corp. and its wholly-owned subsidiary, Glenview State Bank, following completion of this acquisition in 2021, as well as to exploratory costs. 2. Restructuring expenses were related to previously disclosed restructuring and efficiency plans and to corporate strategy advisement.
Added
MD&A RESULTS OF OPERATIONS — THREE YEARS ENDED DECEMBER 31, 2025 Net Income Results of Busey’s operations are presented below, segregated by operating segment: Years Ended December 31, (dollars in thousands) 2025 2024 2023 Net income Banking $ 150,342 $ 117,266 $ 123,853 Wealth Management 24,183 22,030 18,804 FirsTech (1,763) (670) 830 Other (37,500) (24,935) (20,922) Net income $ 135,262 $ 113,691 $ 122,565 First Busey Corporation (BUSE) | 2025 — 57 Table of Contents Contents of Item 7.
Removed
During 2024, in anticipation of the FOMC pivot to an easing cycle, Busey limited its exposure to term funding structures and intentionally priced savings specials to encourage maturing CD balances to migrate to managed rate non-maturity products.
Added
The objective of Busey’s presentation of adjusted earnings and adjusted earnings metrics is to allow investors and analysts to more clearly identify quarterly trends in core earnings performance.
Removed
Beginning in September 2024 Busey began lowering rates on special priced deposit accounts and other managed rate products to benefit from the FOMC rate cuts. Busey continues to offer CD specials with shorter term structures as well as offering attractive premium savings rates to encourage rotation of maturing CD deposits into nimble pricing products.
Added
During the year ended December 31, 2025, in connection with the CrossFirst acquisition, Busey’s recorded expense for the initial provision for credit losses consisting of a Day 2 provision for loan losses of $42.4 million, a Day 2 provision for unfunded commitments of $3.1 million, and an adjustment to the initial provision for unfunded commitments of $4.0 million that was recorded based on revised estimates resulting from implementation of a new CECL model. 3.
Removed
Beginning in the second quarter of 2024, Busey also saw the full benefit of the December 2023 and March 2024 targeted balance sheet repositioning in its net interest margin.
Added
Beginning in 2025, Busey revised its calculation of adjusted net income for all periods presented to include, as applicable, adjustments for net securities gains and losses, realized net gains and losses on the sale of mortgage servicing rights, and non-recurring deferred tax adjustments. 3.
Removed
First Busey Corporation (BUSE) | 2024 — 59 Table of Contents Contents of Item 7. MD&A The net interest margin discussion above is based upon the results and average balances for the years ended December 31, 2024, 2023, and 2022.
Added
Beginning in 2025, Busey revised its presentation, for all periods presented, to reclassify the provision for unfunded commitments so that it is now included within the provision for credit losses, affecting the calculation of pre-provision net revenue and related measures and ratios.
Removed
MD&A Total noninterest income was $139.7 million for the year ended December 31, 2024, an increase of 15.2% when compared with $121.2 million for the year ended December 31, 2023. Total noninterest income represented 30.2% of total revenue 2 in 2024, compared to 27.4% in 2023.
Added
Government obligations 96,287 4,782 4.97 % Obligations of states and political subdivisions 233,027 9,670 4.15 % Other securities 2,596,463 76,881 2.96 % Restricted bank stock 65,988 2,956 4.48 % Loans held for sale 7,257 440 6.06 % Portfolio loans 1, 2 12,756,937 777,474 6.09 % Total interest-earning assets 1, 3 16,331,740 $ 896,836 5.49 % Cash and due from banks 166,511 Premises and equipment 175,077 ACL (172,147) Other assets 1,228,706 Total assets $ 17,729,887 Liabilities and stockholders’ equity Interest-bearing transaction deposits $ 3,076,961 $ 56,233 1.83 % Savings and money market deposits 5,738,073 154,300 2.69 % Time deposits 2,471,023 92,456 3.74 % Federal funds purchased and repurchase agreements 149,916 3,708 2.47 % Borrowings 4 242,225 12,064 4.98 % Junior subordinated debt issued to unconsolidated trusts 76,816 5,490 7.15 % Total interest-bearing liabilities 11,755,014 $ 324,251 2.76 % Net interest spread 1 2.73 % Noninterest-bearing deposits 3,450,226 Other liabilities 244,188 Stockholders’ equity 2,280,459 Total liabilities and stockholders’ equity $ 17,729,887 Interest income / earning assets 1, 3 $ 16,331,740 $ 896,836 5.49 % Interest expense / earning assets 16,331,740 324,251 1.98 % Net interest margin 1 $ 572,585 3.51 % ___________________________________________ 1.
Removed
On a combined basis, revenue from these two critical operating areas was $85.6 million for the year ended December 31, 2024, a 9.1% increase from $78.5 million for the year ended December 31, 2023. Fees for customer services increased by 6.5% to $30.9 million in 2024, compared to $29.0 million in 2023.
Added
On a tax-equivalent basis, assuming a federal income tax rate of 21.0%. 2. Non-accrual loans have been included in average portfolio loans. 3. Interest income includes tax-equivalent adjustments of $3.0 million. 4. Borrowings include, as applicable, short-term borrowings, long-term borrowings, senior notes, and subordinated notes. Interest expense includes a non-usage fee on the revolving credit facility.
Removed
Mortgage revenue was $2.1 million in 2024, compared to $1.1 million in 2023. Increases were primarily related to sold-loan mortgage volume. General economic conditions and interest rate volatility may impact future mortgage revenue.
Added
Government obligations 5,495 158 2.88 % Obligations of states and political subdivisions 153,467 4,338 2.83 % Other securities 2,567,526 69,786 2.72 % Restricted bank stock 14,414 848 5.88 % Loans held for sale 8,012 503 6.28 % Portfolio loans 1, 2 7,804,629 427,300 5.47 % Total interest-earning assets 1, 3 10,999,424 $ 525,374 4.78 % Cash and due from banks 109,400 Premises and equipment 121,663 ACL (89,369) Other assets 910,753 Total assets $ 12,051,871 Liabilities and stockholders’ equity Interest-bearing transaction deposits $ 2,469,664 $ 42,925 1.74 % Savings and money market deposits 3,246,507 74,536 2.30 % Time deposits 1,584,953 61,002 3.85 % Federal funds purchased and repurchase agreements 147,786 4,308 2.92 % Borrowings 4 240,137 13,651 5.68 % Junior subordinated debt issued to unconsolidated trusts 74,037 4,648 6.28 % Total interest-bearing liabilities 7,763,084 $ 201,070 2.59 % Net interest spread 1 2.19 % Noninterest-bearing deposits 2,738,892 Other liabilities 207,471 Stockholders’ equity 1,342,424 Total liabilities and stockholders’ equity $ 12,051,871 Interest income / earning assets 1, 3 $ 10,999,424 $ 525,374 4.78 % Interest expense / earning assets 10,999,424 201,070 1.83 % Net interest margin 1 $ 324,304 2.95 % ___________________________________________ 1.
Removed
Busey sold the mortgage servicing rights on approximately $923.5 million of one- to four-family mortgage loans, which enabled Busey to sell available for sale investment securities with a book value of approximately $108.2 million for a pre-tax loss of $6.8 million with no resulting negative impact to tangible capital.
Added
First Busey Corporation (BUSE) | 2025 — 62 Table of Contents Contents of Item 7. MD&A Year Ended December 31, 2023 (dollars in thousands) Average Balance Income/ Expense Yield/ Rate Assets Interest-bearing bank deposits and federal funds sold $ 214,422 $ 10,531 4.91 % Investment securities: U.S.
Removed
Other income increased by 42.0% to $14.3 million in 2024, compared to $10.1 million in 2023.
Added
Government obligations 4,429 195 4,624 Obligations of state and political subdivisions 2,802 2,530 5,332 Other securities 794 6,301 7,095 Restricted bank stock 2,356 (248) 2,108 Loans held for sale (46) (17) (63) Portfolio loans 297,176 52,998 350,174 Change in interest income 313,402 58,060 371,462 Increase (decrease) in interest expense Interest-bearing transaction deposits 11,005 2,303 13,308 Savings and money market deposits 68,504 11,260 79,764 Time deposits 33,198 (1,744) 31,454 Federal funds purchased and repurchase agreements 61 (661) (600) Borrowings 132 (1,719) (1,587) Junior subordinated debt owed to unconsolidated trusts 180 662 842 Change in interest expense 113,080 10,101 123,181 Increase (decrease) in net interest income $ 200,322 $ 47,959 $ 248,281 Percentage increase (decrease) in net interest income over prior period 76.6 % First Busey Corporation (BUSE) | 2025 — 64 Table of Contents Contents of Item 7.
Removed
Increases in other income were primarily attributable to increases in commercial loan sales gains and venture capital income, as well as the addition of Life Equity Loan ® servicing income beginning in the second quarter of 2024. 2 Total revenue consists of net interest income plus noninterest income.
Added
MD&A Years Ended December 31, 2024 vs. 2023 Change Due To (dollars in thousands) Average Volume Average Yield/Rate Total Change Increase (decrease) in interest income Interest-bearing bank deposits and federal funds sold $ 11,643 $ 267 $ 11,910 Investment securities: U.S.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

3 edited+0 added−0 removed7 unchanged
Biggest changeBusey’s interest rate risk resulting from immediate and sustained changes in interest rates, expressed as a change in net interest income as a percentage of the net interest income calculated in the constant base model, was as follows: Year-One: Basis Point Changes Year-Two: Basis Point Changes December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 400 8.50 % 7.38 % 10.85 % 8.55 % 300 6.26 % 5.49 % 8.01 % 6.34 % 200 4.05 % 3.64 % 5.24 % 4.20 % 100 1.96 % 1.81 % 2.59 % 2.10 % -100 (1.81) % (1.91) % (3.35) % (2.98) % -200 (3.39) % (3.86) % (6.65) % (6.12) % -300 (4.03) % (5.60) % (9.47) % (9.17) % -400 (4.41) % (6.91) % (12.43) % (11.36) % Interest rate risk is monitored and managed within approved policy limits and any temporary exceptions to policy in periods of rapid rate movement are approved and documented.
Biggest changeBusey’s interest rate risk resulting from immediate and sustained changes in interest rates, expressed as a change in net interest income as a percentage of the net interest income calculated in the constant base model, was as follows: Year-One: Basis Point Changes Year-Two: Basis Point Changes December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024 +200 4.14 % 4.05 % 5.65 % 5.24 % +100 2.31 % 1.96 % 3.13 % 2.59 % -100 (1.76) % (1.81) % (3.27) % (3.35) % -200 (2.18) % (3.39) % (5.59) % (6.65) % Interest rate risk is monitored and managed within approved policy limits and any temporary exceptions to policy in periods of rapid rate movement are approved and documented.
In these standard simulation models, the balance sheet is projected over a one-year and a two-year time horizon and net interest income is calculated under current market rates and assuming permanent instantaneous shifts of +/-100, +/-200, +/-300, and +/-400 bps.
In these standard simulation models, the balance sheet is projected over a one-year and a two-year time horizon and net interest income is calculated under current market rates and assuming permanent instantaneous shifts of +/-100 and +/-200 bps.
First Busey Corporation (BUSE) | 2024 — 87 Table of Contents
First Busey Corporation (BUSE) | 2025 — 89 Table of Contents

Other BUSEP 10-K year-over-year comparisons