Isabella Bank (ISBA) investor relations material

Executive summary

• Total assets rose 0.5% to $2.2 billion as of June 30, 2026, driven by $53.3 million loan growth and a $15.7 million increase in cash, offset by a $58.5 million decline in AFS securities.

• Net income for Q2 2026 was $5.0 million ($0.69 per diluted share), flat year-over-year; six-month net income was $10.0 million ($1.37 per diluted share), up from $9.0 million ($1.21 per share) in 2025.

• Net interest income increased to $18.1 million for Q2 2026 (NIM 3.54%) and $35.0 million for the first half (NIM 3.43%), reflecting higher loan yields and lower cost of interest-bearing liabilities.

• Noninterest income rose to $4.4 million for Q2 2026, with service charges, BOLI earnings, and wealth management fees all increasing.

• Announced merger agreement with Grand River Commerce, Inc. and Grand River Bank, entering the Grand Rapids market.

Financial highlights

• Loans grew 3.5% to $1.6 billion, led by commercial and residential real estate; consumer loans declined.

• Allowance for credit losses (ACL) increased 5.5% to $14.5 million; nonaccrual loans rose to $7.8 million.

• Total deposits decreased 0.5% to $1.8 billion, with declines in CDs and demand deposits partially offset by increases in savings and money market accounts.

• Book value per share was $32.60; tangible book value per share (non-GAAP) was $26.27.

• Return on average assets was 0.91%; return on average equity was 8.50% for Q2 2026.

Outlook and guidance

• Management expects to complete the Grand River Commerce merger in Q4 2026, projecting pro forma assets of $2.7 billion.

• Management expects the Grand River acquisition to support disciplined growth and market expansion.

• Net proceeds from the at-the-market equity offering are intended for general corporate purposes, including supporting lending growth.

• Forward-looking statements highlight ongoing risks from industry instability, inflation, and regulatory changes.