COFS · ChoiceOne Financial Services, Inc.

ChoiceOne delivered solid Q1 2026 results with net income of $13.7 million and EPS of $0.91, slightly below the prior quarter's $13.9 million and $0.92 but a strong recovery from the year-ago Q1 net loss of $13.9 million driven by merger expenses. Net interest margin expanded 4 basis points to 3.63%, supported by higher loan interest income despite lower accretion from purchased loans ($2.7 million vs $3.1 million prior quarter). Loan interest income rose $13.0 million year-over-year but dipped $975,000 quarter-over-quarter due to reduced accretion. Core loans contracted seasonally by $30.9 million (annualized 4.2%) in Q1 but showed 0.3% growth over 12 months, with management citing a strong loan pipeline from organic relationships. Deposits excluding brokered expanded $68.9 million (7.9% annualized), blending organic growth and municipal seasonality, while cost of deposits fell 3 basis points quarter-over-quarter to support margin gains. Asset quality remained robust with 0.01% annualized net charge-offs and no provision for credit losses; nonperformers ticked up to 1.01%, largely from known purchased credit-deteriorated loans (0.61%). The company exited $351 million pay-fixed swaps for a $4.6 million gain (amortized over six years), reducing asset sensitivity and aligning with long-term value creation. Balance sheet strength evident in $4.4 billion assets, $470 million equity, and $1.2 billion borrowing capacity. Share repurchases continued (50,000 shares in Q1), with 300,272 remaining under plan, reflecting healthy 12.9% capital ratio. CEO Kelly Potes highlighted disciplined growth, expense control, and Michigan market execution, with plans for a new Troy branch in 2026.