[Management View]
Business First Bancshares reported steady profitability with a GAAP net income of $21.5 million for Q3 2025. The company emphasized strong expense control, achieving a core efficiency ratio of 60.45%. Management highlighted successful core conversions and ongoing M&A initiatives, including the Oakwood Bank integration and the upcoming Progressive Bank acquisition.

[Outlook]
The company expects modest expense growth in Q4 2025, supported by cost savings from recent conversions. Loan production is anticipated to return to low- to mid-single-digit growth. Management remains focused on organic growth, integration execution, and measured capital deployment, with potential for share repurchases as capital ratios strengthen.

[Financial Performance]
- GAAP Net Income: $21.5 million
- Non-GAAP Core Net Income: $21.2 million
- Core ROAA: 1.06%
- Core Efficiency Ratio: 60.45%
- Total Loans: Decreased by $26.6 million
- Total Deposits: Increased by $87.2 million
- GAAP Net Interest Margin: 3.68%
- Non-GAAP Core Net Interest Margin: 3.63%

[Q&A Highlights]
Question 1: Expectations around the core margin for the fourth quarter in light of recent Fed cuts and deposit pricing competition?
Answer: We expect to pick up a couple of bps in the fourth-quarter margin due to momentum on the deposit side and normalization of loan growth. Deposit costs remain competitive, and we evaluate competition weekly.

Question 2: Evidence of loan growth rebound in the fourth quarter?
Answer: We had early success in the quarter and expect low to mid-single-digit loan growth. Unfunded line commitments in Q3 will contribute to Q4 growth.

Question 3: Noninterest income growth expectations for Q4 and 2026?
Answer: Momentum is building, but the government shutdown may impact SBA loan sales. Noninterest income may be flat in Q4 but is expected to grow over 20% annually.

Question 4: Strategic perspective on M&A and share repurchases?
Answer: Focus is on executing current acquisitions and organic growth. We are open to share repurchases as capital ratios strengthen.

Question 5: Pricing new loans as interest rates fall and customer sentiment?
Answer: We stick to a pricing model that values risk-adjusted capital. Customers are more optimistic with the prospect of lower rates.

Question 6: Core expenses and hiring plans?
Answer: Core expenses were flat due to thoughtful personnel management. We are poised to take advantage of hiring opportunities, particularly in Texas.

Question 7: Competitive dynamics driving paydowns in Dallas and Houston?
Answer: Paydowns were driven by the natural lifecycle of credits, not competitive pressures.

Question 8: Impact of government shutdown on SBA sales?
Answer: The shutdown delays SBA sales revenue to Q1 2026. We have a strong pipeline of loans waiting for approval.

Question 9: Updates on Progressive Bank acquisition?
Answer: Progressive Bank is performing well, with a positive shareholder vote and regulatory approval process on track. The deal is expected to close in January 2026.

[Sentiment Analysis]
Analysts and management maintained a positive and confident tone throughout the call. Management emphasized steady profitability, strategic focus, and readiness to capitalize on future opportunities.

[Quarterly Comparison]
| Metric | Q3 2025 | Q2 2025 |
|-------------------------------|---------------|---------------|
| GAAP Net Income | $21.5 million | $21.5 million |
| Non-GAAP Core Net Income | $21.2 million | $21.2 million |
| Core ROAA | 1.06% | 1.06% |
| Core Efficiency Ratio | 60.45% | 60.45% |
| Total Loans | -$26.6 million| -$26.6 million|
| Total Deposits | +$87.2 million| +$87.2 million|
| GAAP Net Interest Margin | 3.68% | 3.68% |
| Non-GAAP Core Net Interest Margin | 3.63% | 3.64% |

[Risks and Concerns]
- Government shutdown impacting SBA loan sales.
- Competitive deposit pricing pressures.
- Potential delays in realizing cost savings from recent conversions.

[Final Takeaway]
Business First Bancshares demonstrated steady profitability and effective expense management in Q3 2025. The company is focused on organic growth, successful integration of recent acquisitions, and maintaining strong capital ratios. While the government shutdown poses a risk to noninterest income, management remains confident in their strategic priorities and future growth prospects.