GlobeNewswire Inc | Jan 25, 2021 04:00PM EST

January 25, 2021

BATON ROUGE, La., Jan. 25, 2021 (GLOBE NEWSWIRE) -- Business First Bancshares, Inc. (NASDAQ: BFST) (Business First), parent company of b1BANK, Baton Rouge, Louisiana, today announced its unaudited results for the year ended December 31, 2020, including net income of $30.0 million, or $1.64 per diluted share, an increase of $6.2 million and decrease of $0.10, respectively, from prior year ended December 31, 2019. On a non-GAAP basis, core net income for the year ended December 31, 2020, which excludes certain income and expenses, was $37.5 million, or $2.05 per diluted share, an increase of $12.9 million and an increase of $0.25, respectively, from prior year ended December 31, 2019.

For the quarter ended December 31, 2020, Business First reported net income of $13.8 million, or $0.67 per diluted share, increases of $8.1 million and $0.25, respectively, from the quarter ended December 31, 2019. On a non-GAAP basis, core net income for the quarter ended December 31, 2020, which excludes certain income and expenses, was $14.1 million, or $0.68 per diluted share, an increase of $8.0 million and an increase of $0.23, respectively, from the quarter ended December 31, 2019.

We finished the year right where we set out to last spring, though we never imagined the path we would all take to get here, said Jude Melville, president and CEO. b1BANKs core earnings power reflects our increasing scale and improving efficiency, our asset quality is stable and our balance sheet is as liquid as its ever been. Our people were called upon to process PPP loans, originate and close Main Street Lending Program relationships, and integrate a significant acquisition, all while being tested by COVID-19 and two hurricanes. Not only did they respond, they responded with confidence and pride. Never before has our team been as proud to be community bankers and never before have I been as proud to be a part of their team.

On January 25, 2021, Business Firsts board of directors declared a quarterly dividend based upon financial performance for the fourth quarter in the amount of $0.10 per share, same as the prior quarter, to the common shareholders of record as of February 15, 2021. The dividend will be paid on February 28, 2021, or as soon thereafter as practicable.

Quarterly Highlights

-- Main Street Lending Program. Business First continued to support its clients through the COVID-19 pandemic by electing to participate in the Main Street Lending Program established by the Federal Reserve. Business First was able to originate 45 loans with an aggregate original principal balance of $327.8 million during the third and fourth quarter of 2020, resulting in a gain on sale of $4.2 million related to the transfer of 95% of the principal loan balance, or $311.4 million. As of December 31, 2020, Business First retained $16.4 million of the loan balances with an average balance of $364,000. -- Stable Credit Quality. Ratios of nonperforming loans compared to loans held for investment and nonperforming assets compared to total assets remained stable from 0.32% and 0.54%, respectively, at September 30, 2020, to 0.35% and 0.48% at December 31, 2020. At December 31, 2019, ratios of nonperforming loans compared to loans held for investment and nonperforming assets compared to total assets were 0.53% and 0.58%, respectively, representing stable credit quality through the year ended December 31, 2020. -- Net Interest Margin and Spread. Net interest margin and spread increased from 4.06% and 3.81%, respectively, for the quarter ended September 30, 2020, to 4.26% and 4.03% for the quarter ended December 31, 2020. The increases were largely attributable to purchase accounting accretion (loans and deposits/borrowings), the forgiveness of SBA PPP loans, which accelerated recognition of net loan origination fees, and repricing of deposits. Excluding loan discount accretion, non-GAAP net interest margin and spread were 3.99% and 3.75%, respectively, for the quarter ended December 31, 2020, compared to 3.81% and 3.56% for the quarter ended September 30, 2020. -- Loan Growth. Total loans held for investment at December 31, 2020, were $3.0 billion, a decrease of $91.1 million compared to September 30, 2020. Loans declined (2.96) %, or (11.82) % annualized, for the quarter ended December 31, 2020. The majority of the decline was attributable to the U.S. Small Business Administration (SBA) Paycheck Protection Program (PPP) loan forgiveness, which consisted of $82.2 million of the net decrease in the loan portfolio. Total loans declined, excluding SBA PPP loan forgiveness, for the quarter ended December 31, 2020 by (0.33) %, or (1.32) % annualized. Organic loan growth, excluding SBA PPP and acquired Pedestal Bank (Pedestal) loans from the May 1, 2020 acquisition, for the year ended December 31, 2020 was 6.29%. -- Stock Repurchase Program. Business First repurchased 45,800 shares of stock at a weighted average price per share of $17.42 during the quarter ended December 31, 2020, or 104% of tangible book value per share as of December 31, 2020. For the year ended December 31, 2020, Business First repurchased 480,581 shares of stock at a weighted average price per share of $12.06, or 72% of tangible book value per share as of December 31, 2020.

Financial Condition

December 31, 2020, Compared to September 30, 2020

Loans

Total loans held for investment decreased by $91.1 million compared to September 30, 2020. The decrease was largely attributable to SBA PPP forgiveness within the commercial portfolio of $79.0 million. Loans declined (2.96) %, or (11.82) % annualized, for the quarter ended December 31, 2020. Total loans declined, excluding the reduction from SBA PPP loan forgiveness, for the quarter ended December 31, 2020 by (0.33) %, or (1.32) % annualized. At December 31, 2020, SBA PPP loans with a principal balance of $315.5 million remain outstanding.

Loan growth contracted for the quarter ended December 31, 2020, due to the significant effort placed into accommodating client requests for the Main Street Lending Program. Business First was able to originate $317.2 million loans of which $301.4 million (95% of the total originated) were sold/participated to the Main Street Lending Program during the quarter ended December 31, 2020.

Business Firsts unfunded commitments remained constant throughout the quarter ended December 31, 2020. Business First has not identified any unusual customer usage of unfunded commitments since the beginning of the COVID-19 pandemic in March 2020.

Borrowings

Due to b1BANKs increased cash position/liquidity (including increased liquidity resulting from SBA PPP forgiveness), Business First elected to extinguish $74.0 million of its higher-rate, longer-term Federal Home Loan Bank (FHLB) borrowings with a weighted average rate of 2.25% during December 2020. Business First will save approximately $1.7 million in interest expense during 2021 due to the extinguishment. Business First incurred a loss on early extinguishment of debt of $2.4 million.

Credit Quality

Nonperforming loans as a percentage of total loans held for investment increased from 0.32% as of September 30, 2020, to 0.35% as of December 31, 2020. Nonperforming assets as a percentage of total assets decreased from 0.54% as of September 30, 2020, to 0.48% as of December 31, 2020. The increase in the nonperforming loan ratio was attributable to increases in nonaccrual loans and the decrease in the nonperforming asset ratio was attributable to the sale of other real estate owned properties during the quarter ended December 31, 2020.

Total Shareholders Equity

Book value per common share was $19.88 at December 31, 2020, compared to $19.26 at September 30, 2020. On a non-GAAP basis, tangible book value per share was $16.80 at December 31, 2020, compared to $16.18 at September 30, 2020. Business First repurchased 45,800 shares of stock at a weighted average price per share of $17.42 during the quarter ended December 31, 2020.

December 31, 2020, Compared to December 31, 2019

Loans

Total loans held for investment increased by $1.3 billion compared to December 31, 2019, or 74.91%, due primarily to the acquisition of Pedestal and origination of SBA PPP loans. Organic loan growth, excluding SBA PPP and acquired Pedestal loans from the May 1, 2020 acquisition, for the year ended December 31, 2020 was 6.29%1.

Credit Quality

Nonperforming loans as a percentage of total loans held for investment decreased from 0.53% as of December 31, 2019, to 0.35% as of December 31, 2020. Nonperforming assets as a percentage of total assets decreased from 0.58% as of December 31, 2019, to 0.48% as of December 31, 2020. The decreases were largely attributable to an increase in overall total loans held for investment and total assets from the acquisition of Pedestal during the quarter ended June 30, 2020.

Total Shareholders Equity

Book value per common share was $19.88 at December 31, 2020, compared to $21.47 at December 31, 2019. On a non-GAAP basis, tangible book value per share was $16.80 at December 31, 2020, compared to $17.31 at December 31, 2019. The decreases were attributable to the initial book value dilution caused by the acquisition of Pedestal during the quarter ended June 30, 2020.

Results of Operations

Fourth Quarter 2020 Compared to Third Quarter 2020

Net Income and Diluted Earnings Per Share

For the quarter ended December 31, 2020, net income was $13.8 million, or $0.67 per diluted share, compared to net income of $9.6 million, or $0.46 per diluted share, for the quarter ended September 30, 2020. The increases were largely attributable to an increase in net interest income (primarily due to the accelerated recognition of SBA PPP net loan origination fees due to forgiveness), decrease in interest-bearing deposits due to continued repricing of deposits, and an increase in gain on sale of loans due to the Main Street Lending Program, offset by an increase in other expense due to the extinguishment of FHLB borrowings.

On a non-GAAP basis, core net income, which excludes certain income and expenses, for the quarter ended December 31, 2020, was $14.1 million, or $0.68 per diluted share, compared to core net income of $11.0 million, or $0.53 per diluted share, for the quarter ended September 30, 2020. Notable noncore events impacting earnings for the quarter ended December 31, 2020, included the incurrence of $568,000 in acquisition-related expenses and $158,000 in gains attributed to former bank premises and equipment in other income, compared to the incurrence of $1.2 million in acquisition-related expenses and $635,000 in losses attributed to losses on former bank premises and equipment in other income, largely attributable to branches planned to be closed as a result of the Pedestal acquisition for the quarter ended September 30, 2020.

Interest Income

For the quarter ended December 31, 2020, net interest income totaled $39.6 million and net interest margin and net interest spread were 4.26% and 4.03%, respectively, compared to $36.9 million, 4.06% and 3.81% for the quarter ended September 30, 2020. The average yield on the loan portfolio (excluding SBA PPP loans) was 5.59% for the quarter ended December 31, 2020, compared to 5.65% for the quarter ended September 30, 2020. The average yield on total interest-earning assets was 4.78% for the quarter ended December 31, 2020, compared to 4.67% for the quarter ended September 30, 2020. The increase in interest income was largely attributable to accelerated recognition of SBA PPP net loan origination fees due to forgiveness ($3.2 million total, with approximately $1.8 million accelerated due to forgiveness) for the quarter ended December 31, 2020.

Net interest margin and net interest spread were positively impacted for the quarter ended December 31, 2020, by additional loan discount accretion, 3 basis points impact to both ratios, additional SBA PPP origination fees, 18 basis point impact to both ratios, and reduction in the overall cost of funds (which includes noninterest-bearing deposits).

The average loan yield (excluding SBA PPP loans) was impacted by the origination of loans at lower rates than payoffs during the quarter due to the decline in rates which has occurred since the COVID 19-pandemic.

Non-GAAP net interest margin and net interest spread (excluding loan discount accretion of $2.6 million) were 3.99% and 3.75%, respectively, for the quarter ended December 31, 2020, compared to 3.81% and 3.56% (excluding loan discount accretion of $2.3 million) for the quarter ended September 30, 2020.

Interest Expense

For the quarter ended December 31, 2020, overall cost of funds (which includes noninterest-bearing deposits) decreased by 10 basis points, from 0.63% to 0.53%, compared to the quarter ended September 30, 2020. The decrease in cost of funds was largely attributable to the repricing of deposits.

Other Income

For the quarter ended December 31, 2020, other income was impacted by a $4.4 million increase in gain on sale of loans primarily associated with the Main Street Lending Program, as well as a net increase of $981,000 in gains on sale of other real estate owned and disposal of assets, compared to the quarter ended September 30, 2020.

Other Expenses

For the quarter ended December 31, 2020, the increase in other expenses was largely attributed to a loss on early extinguishment of FHLB borrowings resulting in a net loss of $2.4 million (including the remaining purchase discounts) and an additional $250,000 accrual for shareholder tax within other expenses, $325,000 in advertising and promotions, offset by a $522,000 decrease in salaries and employee benefits, compared to the quarter ended September 30, 2020.

Provision for Loan Losses

During the quarter ended December 31, 2020, Business First recorded a provision for loan losses of $2.1 million, compared to $2.5 million for the quarter ended September 30, 2020. The reserve for the quarter ended December 31, 2020, was impacted by net charge-offs of $450,000 and the continued impact of the qualitative factors related to COVID-19.

Return on Assets and Equity

Return on average assets and equity, each on an annualized basis, were 1.37% and 13.86%, respectively, for the quarter ended December 31, 2020, compared to 0.98% and 9.85%, respectively, for the quarter ended September 30, 2020. Both returns were positively impacted by higher net income for the quarter ended December 31, 2020.

Fourth Quarter 2020 Compared to Fourth Quarter 2019

Net Income and Diluted Earnings Per Share

For the quarter ended December 31, 2020, net income was $13.8 million, or $0.67 per diluted share, compared to net income of $5.8 million, or $0.42 per diluted share, for the quarter ended December 31, 2019. The increases in net income and diluted earnings per share were largely attributable to the increases in net interest income and other income related to the acquisition of Pedestal on May 1, 2020, as well as the SBA PPP and Main Street Lending Program, offset by increases in the provision for loan losses associated with the COVID-19 pandemic in 2020, additional expenses associated with the acquisition of Pedestal on May 1, 2020, and loss on early extinguishment of FHLB borrowings.

On a non-GAAP basis, core net income, which excludes certain income and expenses, for the quarter ended December 31, 2020, was $14.1 million, or $0.68 per diluted share, compared to core net income of $6.1 million, or $0.45 per diluted share, for the quarter ended December 31, 2019. Notable noncore events impacting earnings for the quarter ended December 31, 2020, included the incurrence of $568,000 in acquisition-related expenses and $158,000 in gains attributed to former bank premises and equipment in other income, compared to the incurrence of $125,000 losses associated with the disposal of former bank premises and equipment in other income related to the rebranding of b1BANK and a $216,000 adjustment to estimated provision for income taxes associated with the sale of the Mangham banking center for the quarter ended December 31, 2019.

Interest Income

For the quarter ended December 31, 2020, net interest income totaled $39.6 million and net interest margin and net interest spread were 4.26% and 4.03%, respectively, compared to compared to $20.6 million, 4.08% and 3.65% for the quarter ended December 31, 2019. The average yield on the loan portfolio (excluding SBA PPP loans) was 5.59% for the quarter ended December 31, 2020, compared to 5.82% for the quarter ended December 31, 2019. The average yield on total interest-earning assets was 4.78% for the quarter ended December 31, 2020, compared to 5.28% for the quarter ended December 31, 2019. The increase in interest income was largely attributable to higher average balances due to the Pedestal acquisition and origination of SBA PPP loans during 2020.

Average loan yield (excluding SBA PPP loans), average yield on total interest-earning assets, net interest margin, and net interest spread were impacted for the quarter ended December 31, 2020, by the federal funds rate cuts of 175 basis points, which occurred during the fourth quarter of 2019 through the first quarter of 2020. The average yield on total interest-earning assets was also impacted by the lower-yielding SBA PPP loans originated.

Non-GAAP net interest margin and net interest spread (excluding loan discount accretion of $2.6 million) were 3.99% and 3.75%, respectively, for the quarter ended December 31, 2020, compared to 3.92% and 3.49% (excluding loan discount accretion of $800,000) for the quarter ended December 31, 2019.

Interest Expense

For the quarter ended December 31, 2020, overall cost of funds (which includes noninterest-bearing deposits) decreased by 74 basis points, from 1.27% to 0.53%, compared to the quarter ended December 31, 2019. The decrease in cost of funds was partially attributable to the accretion of deposit and FHLB premiums associated with the Pedestal acquisition, $780,000 or 9 basis points, but primarily attributable to an overall reduction in interest rates on deposit offerings and the lower-yielding deposit portfolio acquired from Pedestal.

Other Income

For the quarter ended December 31, 2020, the increase in other income was largely attributable to the acquisition of Pedestal during the quarter ended June 30, 2020, and $4.4 million gain on sale of loans primarily associated with the Main Street Lending Program, compared to the quarter ended December 31, 2019.

Other Expenses

For the quarter ended September 30, 2020, the increase in other expenses was largely attributable to the acquisition of Pedestal during the quarter ended June 30, 2020 and the $2.4 million loss on early extinguishment of FHLB borrowings, compared to the quarter ended December 31, 2019.

Provision for Loan Losses

During the quarter ended December 31, 2020, Business First recorded a provision for loan losses of $2.1 million compared to $192,000 for the quarter ended December 31, 2019. The reserve for the quarter ended December 31, 2020, was impacted by $450,000 in net charge-offs and the impact of the COVID-19 pandemic on the qualitative factors within the allowance for loan and lease losses.

Return on Assets and Equity

Return on average assets and return on average equity, each on an annualized basis, were 1.37% and 13.86%, respectively, for the quarter ended December 31, 2020, from 1.04% and 8.18%, respectively, for the quarter ended December 31, 2019. Both returns were positively impacted by higher net income for the quarter ended December 31, 2020.

About Business First Bancshares, Inc.Business First Bancshares, Inc., through its banking subsidiary b1BANK operates 42 banking centers in markets across Louisiana and in the Dallas, Texas area. b1BANK provides commercial and personal banking, treasury management and wealth solutions services to small to midsize businesses and their owners and employees. Visit www.b1BANK.com for more information. Business Firsts common stock is traded on the NASDAQ Global Select Market under the symbol BFST.

Non-GAAP Financial MeasuresThis press release includes certain non-GAAP financial measures (e.g., referenced as core) intended to supplement, not substitute for, comparable GAAP measures. These measures typically adjust income available to common shareholders for certain significant activities or transactions that, in managements opinion, can distort period-to-period comparisons of Business Firsts performance. Transactions that are typically excluded from non-GAAP measures include realized and unrealized gains/losses on former bank premises and equipment, investment sales, impaired loan sales, acquisition-related expenses (including, but not limited to, legal costs, system conversion costs, severance and retention payments, etc.). Management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Companys core business. These non-GAAP disclosures are not necessarily comparable to non-GAAP measures that may be presented by other companies. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided at the end of the tables below.

Special Note Regarding Forward-Looking StatementsCertain statements contained in this release may not be based on historical facts and are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as anticipate, believe, estimate, expect, may, might, will, would, could, or intend. We caution you not to place undue reliance on the forward-looking statements contained in this news release, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors, including those factors specified in our Annual Report on Form 10-K and other public filings. Actual results will also be significantly impacted by the effects of the ongoing COVID-19 pandemic, including, among other effects: the impact of the public health crisis; the extent and duration of closures of businesses, including our branches, vendors and customers; the operation of financial markets; employment levels; market liquidity; the impact of various actions taken in response by the U.S. federal government, the Federal Reserve, other banking regulators, state and local governments; the adequacy of our allowance for loan losses in relation to potential losses in our loan portfolio; and the impact that all of these factors have on our borrowers, other customers, vendors and counterparties. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release.

Additional InformationFor additional information on Business First, you may obtain Business Firsts reports that are filed with the Securities and Exchange Commission (SEC) free of charge by using the SECs EDGAR service on the SECs website at www.sec.gov or by contacting the SEC for further information at 1-800-SEC-0330. Alternatively, these documents can be obtained free of charge from Business First by directing a request to: Business First Bancshares, Inc., 500 Laurel Street, Suite 101, Baton Rouge, Louisiana 70801, Attention: Corporate Secretary.

No Offer or SolicitationThis release does not constitute or form part of any offer to sell, or a solicitation of an offer to purchase, any securities of the Company. There will be no sale of securities in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

Misty Albrechtb1BANK225.286.7879Misty.Albrecht@b1BANK.com

______________________________1Calculated by adjusting the beginning loans, $1.7 billion, for the acquired Pedestal loans net of the purchase discount and SBA PPP loans acquired, or $807.2 million, for an adjusted beginning of $2.5 billion, and then removing the remaining SBA PPP loans at December 31, 2020, $315.5 million, from the change of the adjusted beginning to the actual ending at December 31, 2020, or $3.0 billion. This results in a net increase of $158.4 million, divided by the beginning adjusted balance of $2.5 billion, or 6.29%.



Business First Bancshares, Inc.Selected Financial Information(Unaudited) December 31, September 30, December 31,(Dollars in thousands) 2020 2020 2019 Balance Sheet Ratios Loans (HFI) to Deposits 82.71 % 95.25 % 95.97 %Shareholders' Equity to Assets Ratio 9.85 % 10.07 % 12.54 % Loans Receivable Held for Investment Commercial (1) $ 886,325 $ 1,015,173 $ 390,398 Real Estate: Construction and Land 403,065 334,100 244,181 Farmland 55,883 56,567 48,681 1-4 Family Residential 468,650 493,344 293,142 Multi-Family Residential 95,707 99,901 36,454 Nonfarm Nonresidential 971,603 970,197 612,608 Total Real Estate 1,994,908 1,954,109 1,235,066 Consumer (1) 110,122 113,192 84,801 Total Loans (Held for Investment) $ 2,991,355 $ 3,082,474 $ 1,710,265 Allowance for Loan Losses Balance, Beginning of Period $ 20,340 $ 18,715 $ 12,090 Charge-offs ? Quarterly (715 ) (956 ) (190 )Recoveries ? Quarterly 265 90 32 Provision for Loan Losses ? Quarterly 2,134 2,491 192 Balance, End of Period $ 22,024 $ 20,340 $ 12,124 Allowance for Loan Losses to Total 0.74 % 0.66 % 0.71 %Loans (HFI)Net Charge-offs (Recoveries) to 0.01 % 0.03 % 0.01 %Average Total Loans Remaining Loan Purchase Discount $ 35,580 $ 38,207 $ 3,536 Nonperforming Assets Nonperforming Loans: Nonaccrual Loans (2) $ 9,063 $ 7,988 $ 8,977 Loans Past Due 90 Days or More (2) 1,523 1,986 72 Total Nonperforming Loans 10,586 9,974 9,049 Other Nonperforming Assets: Other Real Estate Owned 9,051 10,994 4,036 Other Nonperforming Assets: 402 414 160 Total Other Nonperforming Assets 9,453 11,408 4,196 Total Nonperforming Assets $ 20,039 $ 21,382 $ 13,245 Nonperforming Loans to Total Loans 0.35 % 0.32 % 0.53 %(HFI)Nonperforming Assets to Total Assets 0.48 % 0.54 % 0.58 % (1) Small Business Administration SBA Paycheck Protection Program PPP loansaccounted for $313.9 millionand $1.6 million of the Commercial and Consumerportfolios, respectively, as of December 31, 2020.SBA PPP loans accounted for$392.9 million and $4.8 million of the Commercialand Consumer portfolios,respectively, as of September 30, 2020.

(2) Past due and nonaccrual loan amounts exclude acquired impaired loans, evenif contractually past due or ifthe Company does not expect to receive paymentin full, as the Company is currently accreting interest incomeover theexpected life of the loans.

Business First Bancshares, Inc.Selected Financial Information(Unaudited) Three Months Ended Year Ended December 31, September 30, December 31, December 31, December 31,(Dollars inthousands, except 2020 2020 2019 2020 2019per share data) Per Share Data Basic Earnings per $ 0.67 $ 0.47 $ 0.43 $ 1.65 $ 1.79 Common ShareDiluted Earnings 0.67 0.46 $ 0.42 1.64 1.74 per Common ShareDividends per 0.10 0.10 0.10 0.40 0.38 Common ShareBook Value per 19.88 19.26 21.47 19.88 21.47 Common Share Average Common 20,590,239 20,613,481 13,277,968 18,169,599 13,310,577 Shares OutstandingAverage Diluted 20,726,648 20,704,444 13,638,168 18,243,445 13,670,777 Shares OutstandingEnd of PeriodCommon Shares 20,621,437 20,667,237 13,279,363 20,621,437 13,279,363 Outstanding Annualized Performance Ratios Return on Average 1.37 % 0.98 % 1.04 % 0.88 % 1.11 %AssetsReturn on Average 13.86 % 9.85 % 8.18 % 8.42 % 8.70 %EquityNet Interest 4.26 % 4.06 % 4.08 % 4.06 % 4.10 %MarginNet Interest 4.03 % 3.81 % 3.65 % 3.77 % 3.67 %SpreadEfficiency Ratio 60.27 % 65.65 % 66.50 % 67.75 % 64.37 %(1) Total Quarterly/Year-to-Date $ 4,029,660 $ 3,933,631 $ 2,209,182 $ 3,426,120 $ 2,136,081 Average AssetsTotal Quarterly/Year-to-Date 399,332 390,209 281,589 356,339 273,205 Average Equity Other Expenses Salaries and $ 14,908 $ 15,430 $ 9,025 $ 57,394 $ 35,126 Employee BenefitsOccupancy and Bank 1,525 1,394 920 5,349 4,332 PremisesDepreciation and 1,338 1,322 588 4,334 2,494 AmortizationData Processing 1,967 1,832 477 5,506 2,049 FDIC Assessment 595 594 (15 ) 1,608 278 FeesLegal and Other 626 555 302 2,118 1,319 Professional FeesAdvertising and 645 320 385 1,605 1,535 PromotionsUtilities and 617 789 316 2,368 1,334 CommunicationsAd Valorem Shares 850 673 388 2,348 1,423 TaxDirectors' Fees 173 117 119 464 570 Other Real EstateOwned Expenses and 132 171 632 607 750 Write-DownsMerger andConversion-Related 548 556 (1 ) 3,978 330 ExpensesOther 5,678 3,198 2,067 13,314 6,908 Total Other $ 29,602 $ 26,951 $ 15,203 $ 100,993 $ 58,448 Expenses Other Income Service Charges on $ 1,672 $ 1,592 $ 1,028 $ 5,358 $ 4,035 Deposit AccountsGain on Sales of 15 95 22 135 106 SecuritiesDebit card and ATM 1,555 1,399 450 4,320 1,847 Fee IncomeBank-Owned Life 251 237 170 940 687 Insurance IncomeGain on Sales of 4,413 - 115 4,597 230 LoansMortgage 208 123 113 572 421 Origination IncomeBrokerage 433 281 15 970 73 CommissionCorrespondent Bank 49 45 75 235 418 IncomeRental Income 12 14 2 72 490 Gain (loss) onSale of Banking - - - - 581 CenterGain (loss) onSales of Other 199 (104 ) (7 ) 227 20 Real Estate OwnedLoss on Disposal 51 (627 ) (124 ) (576 ) (774 )of Other AssetsPass-throughIncome from SBIC 170 364 149 2,538 1,553 PartnershipsOther 519 798 248 2,176 1,021 Total Other $ 9,547 $ 4,217 $ 2,256 $ 21,564 $ 10,708 Income (1) Noninterest expense (excluding provision for loan losses) divided bynoninterest income plus net interest income less gain/loss on sales ofsecurities.

Business First Bancshares, Inc.Consolidated Balance Sheets(Unaudited) December 31, September 30, December 31,(Dollars in thousands) 2020 2020 2019 Assets Cash and Due From Banks $ 149,131 $ 103,894 $ 89,371 Federal Funds Sold 174,152 8,395 61,372 Securities Available for Sale, 640,605 547,535 278,193 at Fair ValuesMortgage Loans Held for Sale 969 671 251 Loans and Lease Receivable 2,991,355 3,082,474 1,710,265 Allowance for Loan Losses (22,024 ) (20,340 ) (12,124 )Net Loans and Lease Receivable 2,969,331 3,062,134 1,698,141 Premises and Equipment, Net 58,593 59,241 29,280 Accrued Interest Receivable 23,895 25,622 8,025 Other Equity Securities 12,693 15,641 12,565 Other Real Estate Owned 9,051 10,994 4,036 Cash Value of Life Insurance 45,030 44,779 32,568 Deferred Taxes, Net 5,858 5,829 2,145 Goodwill 53,862 53,627 48,495 Core Deposit Intangible 9,734 10,061 6,694 Other Assets 7,456 6,247 2,699 Total Assets $ 4,160,360 $ 3,954,670 $ 2,273,835 Liabilities Deposits: Noninterest-Bearing $ 1,164,139 $ 945,485 $ 398,847 Interest-Bearing 2,452,540 2,290,776 1,383,163 Total Deposits 3,616,679 3,236,261 1,782,010 Securities Sold Under 21,825 24,604 67,989 Agreements to RepurchaseShort-Term Borrowings 5,020 5,033 - Long-Term Borrowings 6,000 6,000 - Paycheck Protection Program - 107,076 - Liquidity FacilitySubordinated Debt 25,000 25,000 25,000 Subordinated Debt -Trust 5,000 5,000 - Preferred SecuritiesFederal Home Loan Bank 43,145 117,950 93,000 BorrowingsAccrued Interest Payable 2,499 3,621 1,533 Other Liabilities 25,229 26,039 19,206 Total Liabilities 3,750,397 3,556,584 1,988,738 Shareholders' Equity Common Stock 20,621 20,667 13,279 Additional Paid-In Capital 299,540 299,762 212,505 Retained Earnings 79,174 67,399 56,700 Accumulated Other Comprehensive 10,628 10,258 2,613 Income Total Shareholders' Equity 409,963 398,086 285,097 Total Liabilities and $ 4,160,360 $ 3,954,670 $ 2,273,835 Shareholders' Equity

Business First Bancshares, Inc.Consolidated Statements of Income(Unaudited) Three Months Ended Year Ended December 31, September December 31, December 31, December 31, 30,(Dollars in 2020 2020 2019 2020 2019thousands) Interest Income: Interest and Fees $ 41,762 $ 39,918 $ 24,732 $ 140,459 $ 95,433 on LoansInterest andDividends on 2,572 2,474 1,739 8,952 7,225 SecuritiesInterest onFederal Funds Sold 53 69 193 344 809 and Due From BanksTotal Interest 44,387 42,461 26,664 149,755 103,467 Income Interest Expense: Interest on 3,736 4,345 4,908 17,562 19,753 DepositsInterest on 1,067 1,184 1,129 4,547 3,516 BorrowingsTotal Interest 4,803 5,529 6,037 22,109 23,269 Expense Net Interest 39,584 36,932 20,627 127,646 80,198 Income Provision for Loan 2,134 2,491 192 11,435 2,606 Losses: Net InterestIncome After 37,450 34,441 20,435 116,211 77,592 Provision for LoanLosses Other Income: Service Charges on 1,672 1,592 1,028 5,358 4,035 Deposit AccountsGain on Sales of 15 95 22 135 106 SecuritiesGain on Sales of 4,413 - 115 4,597 230 LoansOther Income 3,447 2,530 1,091 11,474 6,337 Total Other Income 9,547 4,217 2,256 21,564 10,708 Other Expenses: Salaries and 14,908 15,430 9,025 57,394 35,126 Employee BenefitsOccupancy and 3,373 3,228 1,715 11,380 7,628 Equipment ExpenseMerger andConversion-Related 548 556 (1 ) 3,978 330 ExpenseOther Expenses 10,773 7,737 4,464 28,241 15,364 Total Other 29,602 26,951 15,203 100,993 58,448 Expenses Income Before 17,395 11,707 7,488 36,782 29,852 Income Taxes: Provision for 3,561 2,098 1,729 6,788 6,080 Income Taxes: Net Income: $ 13,834 $ 9,609 $ 5,759 $ 29,994 $ 23,772

Business First Bancshares, Inc.Consolidated Net Interest Margin(Unaudited) Three Months Ended December 31, 2020 September 30, 2020 December 31, 2019 Average Interest Average Average Interest Average Average Interest Average(Dollars in Outstanding Earned / Yield / Outstanding Earned / Yield / Outstanding Earned / Yield /thousands) Balance Interest Rate Balance Interest Rate Balance Interest Rate Paid Paid Paid Assets Interest-Earning Assets:Total Loans $ 2,685,093 $ 37,509 5.59 % $ 2,638,417 $ 37,250 5.65 % $ 1,698,947 $ 24,732 5.82 %(Excluding SBA PPP)SBA PPP Loans 365,058 4,253 4.66 % 399,366 2,668 2.67 % - - 0.00 %Securities 603,192 2,572 1.71 % 564,630 2,474 1.75 % 290,034 1,739 2.40 %Available for SaleInterest-BearingDeposit in Other 61,485 53 0.34 % 33,970 69 0.81 % 31,648 193 2.44 %BanksTotalInterest-Earning 3,714,828 44,387 4.78 % 3,636,383 42,461 4.67 % 2,020,629 26,664 5.28 %AssetsAllowance for Loan (21,020 ) (19,329 ) (12,174 ) LossesNoninterest-Earning 335,852 316,577 200,727 AssetsTotal Assets $ 4,029,660 $ 44,387 $ 3,933,631 $ 42,461 $ 2,209,182 $ 26,664 Liabilities andShareholders' Equity Interest-Bearing Liabilities:Interest-Bearing $ 2,313,511 $ 3,736 0.65 % $ 2,262,774 $ 4,345 0.77 % $ 1,295,791 $ 4,908 1.52 %DepositsSubordinated Debt 25,000 422 6.75 % 25,000 422 6.75 % 25,000 422 6.75 %Subordinated Debt -Trust Preferred 5,000 42 3.36 % 5,000 45 3.60 % - - 0.00 %SecuritiesAdvances fromFederal Home Loan 105,640 407 1.54 % 122,592 515 1.68 % 96,763 516 2.13 %Bank (FHLB)Paycheck ProtectionProgram Liquidity 79,450 70 0.35 % 107,076 95 0.35 % - - 0.00 %Facility (PPPLF)Other Borrowings 37,605 126 1.34 % 35,437 107 1.21 % 67,087 191 1.14 %TotalInterest-Bearing 2,566,206 4,803 0.75 % 2,557,879 5,529 0.86 % 1,484,641 6,037 1.63 %Liabilities Noninterest-Bearing Liabilities:Noninterest-Bearing $ 1,033,593 $ 957,090 $ 419,231 DepositsOther Liabilities 30,529 28,453 23,721 TotalNoninterest-Bearing 1,064,122 985,543 442,952 LiabilitiesShareholders' 399,332 390,209 281,589 Equity:Total Liabilitiesand Shareholders' $ 4,029,660 $ 3,933,631 $ 2,209,182 Equity Net Interest Spread 4.03 % 3.81 % 3.65 %Net Interest Income $ 39,584 $ 36,932 $ 20,627 Net Interest Margin 4.26 % 4.06 % 4.08 % Overall Cost of 0.53 % 0.63 % 1.27 %Funds NOTE: Average outstanding balances are determined utilizing monthly averagesand average yield/rate is calculated utilizing a 30/360 day count convention.

Business First Bancshares, Inc.Consolidated Net Interest Margin(Unaudited) Year Ended December 31, 2020 December 31, 2019(Dollars in Average Interest Average Average Interest Averagethousands) Outstanding Earned / Yield / Outstanding Earned / Yield / Balance Interest Paid Rate Balance Interest Paid Rate Assets Interest-Earning Assets:Total Loans $ 2,342,034 $ 131,208 5.60 % $ 1,628,803 $ 95,433 5.86 %(Excluding SBA PPP)SBA PPP Loans 271,388 9,251 3.41 % - - 0.00 %Securities 483,976 8,952 1.85 % 300,038 7,225 2.41 %Available for SaleInterest-BearingDeposit in Other 48,345 344 0.71 % 27,878 809 2.90 %BanksTotalInterest-Earning 3,145,743 149,755 4.76 % 1,956,719 103,467 5.29 %AssetsAllowance for Loan (16,540 ) (11,762 ) LossesNoninterest-Earning 296,917 191,124 AssetsTotal Assets $ 3,426,120 $ 149,755 $ 2,136,081 $ 103,467 Liabilities andShareholders' Equity Interest-Bearing Liabilities:Interest-Bearing 1,978,295 $ 0.89 % $ 1,316,896 $ 19,753 1.50 %Deposits 17,562Subordinated Debt 25,000 1,688 6.75 % 25,000 1,688 6.75 %Subordinated Debt -Trust Preferred 3,341 121 3.62 % - - 0.00 %SecuritiesAdvances fromFederal Home Loan 113,999 1,945 1.71 % 69,183 1,581 2.29 %Bank (FHLB)Paycheck ProtectionProgram Liquidity 65,857 237 0.36 % - - 0.00 %Facility (PPPLF)Other Borrowings 43,286 556 1.28 % 29,419 247 0.84 %TotalInterest-Bearing 2,229,778 22,109 0.99 % 1,440,498 23,269 1.62 %Liabilities Noninterest-Bearing Liabilities:Noninterest-Bearing 812,332 402,147 DepositsOther Liabilities 27,672 20,231 TotalNoninterest-Bearing 840,004 422,378 LiabilitiesShareholders' 356,339 273,205 Equity:Total Liabilitiesand Shareholders' $ 3,426,120 $ 2,136,081 Equity Net Interest Spread 3.77 % 3.67 %Net Interest Income $ 127,646 $ 80,198 Net Interest Margin 4.06 % 4.10 % Overall Cost of 0.73 % 1.26 %Funds NOTE: Average outstanding balances are determined utilizing monthly averagesand average yield/rate is calculated utilizing a 30/360 day count convention.

Business First Bancshares, Inc.Non-GAAP Measures(Unaudited) Three Months Ended Year Ended December 31, September 30, December 31, December 31, December 31,(Dollars inthousands, except 2020 2020 2019 2020 2019per share data) Interest Income: Interest income $ 44,387 $ 42,461 $ 26,664 $ 149,755 $ 103,467 Core interest 44,387 42,461 26,664 149,755 103,467 incomeInterest Expense: Interest expense 4,803 5,529 6,037 22,109 23,269 Core interest 4,803 5,529 6,037 22,109 23,269 expenseProvision for Loan Losses: (b)Provision for loan 2,134 2,491 192 11,435 2,606 lossesCore provision 2,134 2,491 192 11,435 2,606 expenseOther Income: Other income 9,547 4,217 2,256 21,564 10,708 Sale of impaired - - - - (91 )credit(Gains) losses onformer bank (158 ) 635 125 351 719 premises andequipment(Gains) on sale of (15 ) (95 ) (22 ) (135 ) (106 )securities(Gains) on sale of - - - - (581 )banking centerCore other income 9,374 4,757 2,359 21,780 10,649 Other Expense: Other expense 29,602 26,951 15,203 100,993 58,448 Acquisition-related (568 ) (1,206 ) (76 ) (9,559 ) (750 )expenses (2)Stock optionexercises - excess - - - (71 ) - taxesEarly lease - - - - (87 )terminationCore other expense 29,034 25,745 15,127 91,363 57,611 Pre-Tax Income: (a) Pre-tax income 17,395 11,707 7,488 36,782 29,852 Sale of impaired - - - - (91 )credit(Gains) losses onformer bank (158 ) 635 125 351 719 premises andequipment(Gains) on sale of (15 ) (95 ) (22 ) (135 ) (106 )securities(Gains) on sale of - - - - (581 )banking centerAcquisition-related 568 1,206 76 9,559 750 expenses (2)Stock optionexercises - excess - - - 71 - taxesEarly lease - - - - 87 terminationCore pre-tax income 17,790 13,453 7,667 46,628 30,630 Provision for Income Taxes: (1)Provision for 3,561 2,098 1,729 6,788 6,080 income taxesTax on sale of - - - - (19 )impaired creditTax on (gains) onformer bank (33 ) 133 26 74 151 premises andequipmentTax on (gains) on (3 ) (20 ) (5 ) (28 ) (22 )sale of securitiesTax on sale of - - (216 ) - (338 )banking centerTax onacquisition-related 120 241 11 1,727 147 expenses (2)Tax on stock option - - - 601 - exercisesTax on early lease - - - - 18 terminationCore provision for 3,645 2,452 1,545 9,162 6,017 income taxesNet Income: Net income 13,834 9,609 5,759 29,994 23,772 Sale of impaired - - - - (72 )credit, net of tax(Gains) losses onformer bankpremises and (125 ) 502 99 277 568 equipment , net oftax(Gains) on sale ofsecurities, net of (12 ) (75 ) (17 ) (107 ) (84 )tax(Gains) on sale ofbanking center, net - - 216 - (243 )of taxAcquisition-relatedexpenses (2), net 448 965 65 7,832 603 of taxStock optionexercises, net of - - - (530 ) - taxEarly leasetermination, net of - - - - 69 taxCore net income $ 14,145 $ 11,001 $ 6,122 $ 37,466 $ 24,613 Pre-tax,pre-provision $ 19,529 $ 14,198 $ 7,680 $ 48,217 $ 32,458 earnings (a+b)Sale of impaired - - - - (91 )credit(Gains) losses onformer bank (158 ) 635 125 351 719 premises andequipment(Gains) on sale of (15 ) (95 ) (22 ) (135 ) (106 )securitiesLoss on sale of - - - - (581 )banking centerAcquisition-related 568 1,206 76 9,559 750 expenses (2)Stock option - - - 71 - exercisesEarly lease - - - - 87 terminationCore pre-tax,pre-provision $ 19,924 $ 15,944 $ 7,859 $ 58,063 $ 33,236 earnings Average Diluted 20,726,648 20,704,444 13,638,168 18,243,445 13,670,777 Shares Outstanding Diluted Earnings Per Share:Diluted earnings $ 0.67 $ 0.46 $ 0.42 $ 1.64 1.74 per shareSale of impaired - - - - (0.01 )credit, net of tax(Gains) losses onformer bankpremises and (0.01 ) 0.02 0.01 0.02 0.04 equipment , net oftax(Gains) on sale ofsecurities, net of (0.00 ) (0.00 ) (0.00 ) (0.01 ) (0.01 )tax(Gains) on sale of - - 0.02 - (0.02 )banking centerAcquisition-relatedexpenses (2), net 0.02 0.05 0.00 0.43 0.05 of taxStock option - - - (0.03 ) - exercisesEarly leasetermination, net of - - - - 0.01 taxCore diluted $ 0.68 $ 0.53 $ 0.45 $ 2.05 $ 1.80 earnings per share Pre-tax,pre-provision $ 0.94 $ 0.69 $ 0.56 $ 2.64 $ 2.37 profit dilutedearnings per shareSale of impaired - - - - (0.01 )credit(Gains) losses onformer bank (0.01 ) 0.03 0.01 0.02 0.06 premises andequipment(Gains) on sale of (0.00 ) (0.01 ) (0.00 ) (0.01 ) (0.01 )securities(Gains) on sale of - - - - (0.04 )banking centerAcquisition-related 0.03 0.06 0.01 0.52 0.05 expenses (2)Stock option - - - 0.00 - exercisesEarly lease - - - - 0.01 terminationCore pre-tax,pre-provision $ 0.96 $ 0.77 $ 0.58 $ 3.18 $ 2.43 diluted earningsper share (1) Tax rates, exclusive of certain nondeductible merger-related expenses andgoodwill, utilized were 21% for 2020 and 2019. These rates approximatedthemarginal tax rates.(2) Includes merger and conversion-related expenses and salary and employeebenefits.

Business First Bancshares, Inc.Non-GAAP Measures(Unaudited) Three Months Ended Year Ended December 31, September 30, December 31, December 31, December 31,(Dollars inthousands, except 2020 2020 2019 2020 2019per share data) Total Quarterly/Year-to-Date $ 4,029,660 $ 3,933,631 $ 2,209,182 $ 3,426,120 $ 2,136,081 Average AssetsTotal Quarterly/Year-to-Date $ 399,332 $ 390,209 $ 281,589 $ 356,339 $ 273,205 Average Equity Net Income: Net income $ 13,834 $ 9,609 $ 5,759 $ 29,994 $ 23,772 Sale of impaired - - - - (72 )credit, net of tax(Gains) losses onformer bankpremises and (125 ) 502 99 277 568 equipment , net oftax(Gains) on sale ofsecurities, net of (12 ) (75 ) (17 ) (107 ) (84 )tax(Gains) on sale ofbanking center, net - - 216 - (243 )of taxAcquisition-relatedexpenses (2), net 448 965 65 7,832 603 of taxStock optionexercises, net of - - - (530 ) - taxEarly leasetermination, net of - - - - 69 taxCore net income $ 14,145 $ 11,001 $ 6,122 $ 37,466 $ 24,613 Return on average 1.37 % 0.98 % 1.04 % 0.88 % 1.11 %assetsCore return on 1.40 % 1.12 % 1.11 % 1.09 % 1.15 %average assetsReturn on equity 13.86 % 9.85 % 8.18 % 8.42 % 8.70 %Core return on 14.17 % 11.28 % 8.70 % 10.51 % 9.01 %average equity Interest Income: Interest income $ 44,387 $ 42,461 $ 26,664 $ 149,755 $ 103,467 Core interest 44,387 42,461 26,664 149,755 103,467 incomeInterest Expense: Interest expense 4,803 5,529 6,037 22,109 23,269 Core interest 4,803 5,529 6,037 22,109 23,269 expenseOther Income: Other income 9,547 4,217 2,256 21,564 10,708 Sale of impaired - - - - (91 )credit(Gains) losses onformer bank (158 ) 635 125 351 719 premises andequipment(Gains) on sale of (15 ) (95 ) (22 ) (135 ) (106 )securities(Gains) on sale of - - - - (581 )banking centerCore other income 9,374 4,757 2,359 21,780 10,649 Other Expense: Other expense 29,602 26,951 15,203 100,993 58,448 Acquisition-related (568 ) (1,206 ) (76 ) (9,559 ) (750 )expensesStock optionexercises - excess - - - (71 ) - taxesEarly lease - - - - (87 )terminationCore other expense $ 29,034 $ 25,745 $ 15,127 $ 91,363 $ 57,611 Efficiency Ratio: Other expense (a) $ 29,602 $ 26,951 $ 15,203 $ 100,993 $ 58,448 Core other expense $ 29,034 $ 25,745 $ 15,127 $ 91,363 $ 57,611 (c)Net interest andother income (1) $ 49,116 $ 41,054 $ 22,861 $ 149,075 $ 90,800 (b)Core net interestand other income $ 48,958 $ 41,689 $ 22,986 $ 149,426 $ 90,847 (1) (d)Efficiency ratio (a 60.27 % 65.65 % 66.50 % 67.75 % 64.37 %/b)Core efficiency 59.30 % 61.75 % 65.81 % 61.14 % 63.42 %ratio (c/d) Total AverageInterest-Earnings $ 3,714,828 $ 3,636,383 $ 2,020,629 $ 3,145,743 $ 1,956,719 Assets Net Interest Income:Net interest income $ 39,584 $ 36,932 $ 20,627 127,646 $ 80,198 Loan discount (2,567 ) (2,270 ) (800 ) (6,592 ) (2,602 )accretionNet interest incomeexcluding loan $ 37,017 $ 34,662 $ 19,827 $ 121,054 $ 77,596 discount accretion Net interest margin 4.26 % 4.06 % 4.08 % 4.06 % 4.10 %(2)Net interest marginexcluding loan 3.99 % 3.81 % 3.92 % 3.85 % 3.97 %discount accretion(2)Net interest spread 4.03 % 3.81 % 3.65 % 3.77 % 3.67 %Net interest spreadexcluding loan 3.75 % 3.56 % 3.49 % 3.56 % 3.54 %discount accretion (1) Excludes gains/losses on sales of securities.(2) Calculated utilizing a 30/360 day count convention.

Business First Bancshares, Inc.Non-GAAP Measures(Unaudited) December 31, September 30, December 31,(Dollars in thousands, 2020 2020 2019except per share data) Total Shareholders' (Common) Equity:Total shareholders' equity $ 409,963 $ 398,086 $ 285,097 Goodwill (53,862 ) (53,627 ) (48,495 )Core deposit intangible (9,734 ) (10,061 ) (6,694 )Total tangible common equity $ 346,367 $ 334,398 $ 229,908 Total Assets: Total assets $ 4,160,360 $ 3,954,670 $ 2,273,835 Goodwill (53,862 ) (53,627 ) (48,495 )Core deposit intangible (9,734 ) (10,061 ) (6,694 )Total tangible assets $ 4,096,764 $ 3,890,982 $ 2,218,646 Common shares outstanding 20,621,437 20,667,237 13,279,363 Book value per common share $ 19.88 $ 19.26 $ 21.47 Tangible book value per $ 16.80 $ 16.18 $ 17.31 common shareCommon equity to total 9.85 % 10.07 % 12.54 %assetsTangible common equity to 8.45 % 8.59 % 10.36 %tangible assets