📰 What This Document Is 📜

This filing is an 8-K, which is a report used to announce major, unscheduled corporate events to the SEC and the public. Since it includes detailed financial statements and performance metrics, it functions as an earnings release. The document summarizes Civista Bancshares, Inc.'s (NASDAQ: CIVB) financial results for the first quarter of 2026. Investors should expect a deep dive into the company's performance, its liquidity, and the ongoing integration following its recent acquisition of The Farmers Savings Bank (FSB).

👉 Key takeaway: The Q1 2026 results are complex because they include "non-recurring, acquisition-related adjustments" from the merger with FSB, which impacts how the full financial picture should be viewed.

🏢 What The Company Does 🏦

Civista Bancshares, Inc. is a financial holding company headquartered in Sandusky, Ohio. Its core subsidiary, Civista Bank, has a long history, having been founded in 1884. In simple terms, Civista operates as a full-service bank.

👉 How they make money: They provide traditional banking services like commercial lending, mortgage services, and wealth management. They also generate revenue through services like commercial equipment leasing, which is managed by their Civista Leasing and Finance Division, serving businesses nationwide. Today, Civista Bank operates 44 locations across Ohio, Southeastern Indiana, and Northern Kentucky.

💰 Financial Highlights for Q1 2026 📈

The first quarter of 2026 saw significant increases in both net income and earnings per share (EPS) compared to the prior years. It is important to note these figures reflect the complexity of integrating a new bank—the Farmers Savings Bank (FSB).

• Net Income: Civista reported a net income of $15.0 million for the quarter ended March 31, 2026.
  • This represents a $4.8 million (47%) increase compared to the $10.2 million net income reported in Q1 2025.
  • It also increased by $2.7 million (22%) compared to the Q4 2025 net income of $12.3 million.
• Diluted EPS: Diluted earnings per common share stood at $0.72 for Q1 2026.
  • This is a $0.06 (9%) increase from the $0.66 EPS reported in Q1 2025, and an 18% increase from the $0.11 EPS of Q4 2025.

👉 Why this matters: The strong reported growth metrics are partially due to non-core activities, making the non-GAAP (adjusted) metrics in the deeper financial sections critical for understanding core operational strength.

🚀 Key Operational Metrics and Efficiency ⚙️

Financial metrics help analysts judge how efficiently the bank is running. In Q1 2026, Civista reported improvements in its lending efficiency and ability to manage costs.

• Net Interest Margin (NIM): The NIM (which measures the bank's profit from lending relative to its cost of funds) expanded to 3.85% in Q1 2026.
  • This is an improvement of 34 basis points (0.34%) year-over-year, and 16 basis points sequentially.
  • This improvement reflects lower funding costs and disciplined balance-sheet management.
• Efficiency Ratio: The efficiency ratio was 60.1% in Q1 2026.
  • This is an improvement compared to the 64.9% ratio seen in Q1 2025.
  • What is this? It measures operating expenses relative to total revenue. A lower ratio generally indicates better operational efficiency (less cost for every dollar earned).
• Return on Assets (ROA): ROA was 1.41% in Q1 2026.
  • This is up from 1.00% in Q1 2025, indicating the company is using its assets more effectively to generate profit.

💵 Interest Income and Funding Costs 💸

A bank's primary source of revenue is the spread between the interest it earns on loans and the interest it pays out to depositors. This section shows the movement of that core funding dynamic.

• Net Interest Income (NII): NII increased $5.1 million, or 15.4%, compared to the same period last year. This is driven by higher interest income and lower interest expenses.
• Cost of Funds: The cost of funds was 196 basis points (2.31% in Q1 2025), which is significantly lower.
  • This cost reduction was achieved through actively managing the bank's funding mix by shifting away from higher-cost sources, such as brokered deposits and short-term FHLB advances, while increasing stable core deposits.
• Cost of Deposits: The cost of deposits was 181 basis points in Q1 2026, down 19 basis points from 200 basis points in Q1 2025.
  • This reflects the bank's success in attracting more stable, lower-cost deposits.

🏛️ Asset Growth and Liquidity 🏦

This section provides a snapshot of the bank's total assets and where its money is held. The balance sheet shows strategic shifts in the bank's holdings.

• Total Assets: Total assets at March 31, 2026, were $4.3 billion, a minor decrease of $38.1 million (0.9%) from December 31, 2025.
• Total Deposits: Total deposits rose $35.4 million, or 1.0%, to $3.5 billion by March 31, 2026.
  • The increase was primarily fueled by growth in Interest-bearing demand deposits (up $18.9 million) and Savings and money market accounts (up $56.7 million).
• Key Balance Sheet Management:
  • Brokered Deposits: The balance decreased $25.0 million from December 31, 2025, as the bank strategically reduced its reliance on these potentially volatile funding sources.
  • FHLB Advances: Short-term FHLB advances decreased to $100.0 million (down $75.0 million) from December 31, 2025, supporting the narrative of reduced reliance on expensive wholesale funding.

🛡️ Credit Quality and Loan Health 📉

A bank's health heavily depends on its ability to predict and absorb loan losses. This analysis confirms the bank is maintaining a careful watch on its loan portfolio.

• Allowance for Credit Losses (ACL): The ACL ratio for loans was 1.26% at March 31, 2026.
  • This is a minor improvement from 1.30% in Q1 2025, suggesting credit risk remains stable.
• Non-Performing Assets (NPAs): NPAs totaled $30.2 million in Q1 2026, a decrease of $1.0 million (3.3%) from Q4 2025.
  • 👉 Why this matters: A decreasing number of non-performing loans signals that the bank is actively managing and resolving troubled debts within its portfolio.
• Loan Composition: Total loans were $3.23 billion at March 31, 2026.
  • The largest segment remains Residential Real Estate, followed by Commercial Real Estate (Non-Owner Occupied) at $1.23 billion.

💰 Profit Drivers: Non-Interest Income & Expenses 🎁

Non-interest income captures revenue streams outside of traditional lending, which is important for understanding diversified profit generation.

• Non-Interest Income: Total non-interest income was $9.4 million, an increase of 20.0% compared to Q1 2025.
  • The biggest contributor was Net gain on sale of loans and leases, which increased $1.0 million due to changes in the interest rate environment.
  • Other notable sources include increased Service charges (up $0.2 million) and Wealth management fees.
• Non-Interest Expense: Total non-interest expense for Q1 2026 was $29.9 million, up 10.1% from Q1 2025.
  • This increase was significantly influenced by non-recurring adjustments related to the FSB merger, which added $0.4 million to the expense.
  • Compensation expense rose $2.2 million, reflecting a growth in the bank's full-time employee count, which rose to an average of 535 FTEs.

💼 Executive Commentary and Strategy 🎤

Dennis Shaffer, President and CEO, provided commentary that frames the financial numbers for the reader.

• “Civista reported a solid start to 2026, with first‑quarter net income of $15.0 million, or $0.72 per diluted share,” said Dennis Shaffer.
  • He highlighted that the strong results were due to "continued expansion in net interest margin, disciplined expense management, and stable credit performance."
• Shaffer also noted that, in addition to earnings, the bank successfully handled the major operational hurdle of the merger: “The conversion was executed smoothly and on schedule, reflecting our disciplined approach to integration and our commitment to minimizing disruption for customers and employees.”

👉 Why this matters: The CEO is strategically reinforcing that the company's strengths lie in its community-banking model and its ability to manage operations while integrating a massive acquisition.

👑 Capital and Shareholder Actions 💵

This section details the bank's balance sheet strength and how it returned value to its shareholders.

• Total Shareholders' Equity: Equity totaled $552.2 million at March 31, 2026, an increase of $8.8 million from December 31, 2025.
  • This increase was supported by $11.3 million in retained earnings.
• Dividend: Civista declared a quarterly cash dividend of $0.18 per share.
  • This marks an increase from the $0.17 per share paid in the prior quarter. Based on the March 31, 2026 share price of $22.79, this dividend represents an annualized yield of 3.16%.

🗓️ Looking Ahead: Conference Call Details 📞

For those who need more details, the company provided clear logistics for follow-up information.

• Civista Bancshares, Inc. will host a conference call to discuss the Q1 2026 results on Wednesday, April 22, 2026, at 1:00 p.m. ET.
• Participants can access the live webcast via the Investor Relations section of the company's website (www.civb.com).

🧠 The Analogy 🏦

Running a regional bank, like Civista, is like managing a large, complex community utility—a combination of a local shop, a utility provider, and a major real estate portfolio. When Civista acquired FSB, it was like merging two separate plumbing systems. The financial filings show that the engineers (management) successfully connected the two systems, minimizing disruption (low deposit cost), but the initial "clean-up costs" (non-recurring merger adjustments) made the first few weeks appear messy. However, the core plumbing (NIM and capital) is fundamentally stronger and more efficient than before the merger.

🧩 Final Takeaway 🏆

Civista demonstrated strong operational performance in Q1 2026, with improving efficiencies and disciplined cost management following the successful merger with FSB. The bank is focused on stabilizing its funding mix and using its community-banking model to continue supporting local markets while raising dividends.