Sierra Bancorp (BSRR) investor relations material

Executive summary

• Net income for Q3 2025 was $9.7 million ($0.72 per diluted share), down 9% year-over-year and sequentially; YTD net income was $29.4 million, down 3% from the prior year.

• Diluted EPS for the nine months rose 3% to $2.15, mainly due to share repurchases.

• Annualized return on average equity was 10.81% and return on average assets was 1.04% for Q3 2025.

• The decrease in net income was driven by higher provision for credit losses and increased noninterest expense, partially offset by higher net interest income.

• Loan portfolio and customer base grew despite a challenging interest rate environment and episodic credit issues.

Financial highlights

• Net interest income for Q3 2025 increased 4% year-over-year to $32.0 million; YTD net interest income rose 3% to $92.7 million.

• Net interest margin improved to 3.78% in Q3 2025 from 3.66% a year ago; YTD margin was 3.73%.

• Efficiency ratio improved to 58.05% in Q3 2025 from 59.43% in the prior quarter.

• Provision for credit losses was $3.7 million in Q3 2025, up $2.3 million year-over-year, mainly due to a single agricultural production loan.

• Noninterest income for Q3 2025 was $8.1 million, up 3% year-over-year; YTD noninterest income was $23.3 million, down 3%.

• Noninterest expense increased 4% in Q3 2025 to $23.6 million; YTD noninterest expense decreased 0.3% to $69.8 million.

Outlook and guidance

• Management expects stable net interest income under most-likely interest rate scenarios, with asset sensitivity slightly reduced compared to the prior year.

• Management remains optimistic for Q4 2025 and beyond, citing a strong balance sheet and team.

• Liquidity remains robust, with $2.2 billion in available funding sources, representing 75% of total deposits.

• The company continues to monitor credit quality closely, especially in agricultural lending.