$HBIA

HILLS BANCORPORATION

CIK:0000732417|SEC Filings

CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2026	Jun. 30, 2025	Jun. 30, 2026	Jun. 30, 2025
Interest income:
Loans, including fees	$ 52,263	$ 48,719	$ 102,533	$ 94,849
Investment securities:
Taxable	7,595	6,389	14,714	12,724
Nontaxable	2,870	2,728	5,777	5,278
Federal funds sold	47	146	138	335
Total interest income	62,775	57,982	123,162	113,186
Interest expense:
Deposits	13,407	14,206	26,115	28,684
Other short-term borrowings	3,478	1,994	6,814	4,936
FHLB borrowings	1,809	4,743	4,359	8,365
Total interest expense	18,694	20,943	37,288	41,985
Net interest income	44,081	37,039	85,874	71,201
Credit loss expense (benefit)	(1,458)	1,137	(2,524)	5,007
Net interest income after credit loss expense	45,539	35,902	88,398	66,194
Noninterest income:
Net gain on sale of loans	506	459	1,021	703
Other noninterest income	618	422	1,605	1,199
Gain on sale of investment securities	1,693	0	1,680	0
Noninterest income	10,932	8,534	19,465	16,655
Noninterest expenses:
Salaries and employee benefits	12,332	11,251	24,878	22,616
Occupancy	1,175	1,086	2,087	2,236
Furniture, equipment and software	2,497	1,849	4,883	3,595
Office supplies and postage	535	463	1,089	975
Advertising and business development	870	801	1,888	1,635
Outside services	4,562	3,917	9,135	7,802
FDIC insurance assessment	504	497	1,030	1,009
Other noninterest expense	801	934	2,166	1,577
Noninterest expenses	23,276	20,798	47,156	41,445
Income before income taxes	33,195	23,638	60,707	41,404
Income taxes	7,183	4,986	12,752	8,319
Net income	$ 26,012	$ 18,652	$ 47,955	$ 33,085
Earnings per share:
Basic (in dollars per share)	$ 1.49	$ 1.05	$ 2.74	$ 1.85
Diluted (in dollars per share)	$ 1.49	$ 1.05	$ 2.74	$ 1.85
Trust fees
Noninterest income:
Fee income	$ 4,533	$ 4,260	$ 8,499	$ 8,305
Service charges and fees
Noninterest income:
Fee income	$ 3,582	$ 3,393	$ 6,660	$ 6,448

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2026	Jun. 30, 2025
Cash Flows from Operating Activities
Net income	$ 47,955	$ 33,085
Adjustments to reconcile net income to net cash and cash equivalents provided by operating activities:
Depreciation	1,112	1,198
Credit loss expense (benefit)	(2,524)	5,007
Loss on sale of investment securities available for sale	13	0
Gain on sale of VISA Class B shares	(1,693)	0
Forfeiture of common stock	(286)	(217)
Share-based compensation	25	12
Compensation expensed through issuance of common stock	582	446
(Provision) benefit for deferred income taxes	2,920	(9,056)
Purchase of state tax credits	(647)	0
Net (gain) loss on sale of other real estate owned and other repossessed assets	(117)	366
Loss from equity method investments	155	219
Net loss on the disposal of property and impairments of property	(55)	0
Increase in accrued interest receivable	(458)	(1,384)
Net accretion of discount on investment securities	(2,073)	(1,450)
Increase in other assets	(736)	(183)
Amortization of operating lease right of use assets	133	131
Amortization of tax credit real estate investments	559	954
Increase in accrued interest payable and other liabilities	(1,253)	(3,787)
Loans originated for sale	(118,397)	(74,751)
Proceeds on sales of loans	118,859	73,612
Net gain on sales of loans	(1,021)	(703)
Net cash and cash equivalents provided by operating activities	43,163	23,499
Cash Flows from Investing Activities
Proceeds from maturities of investment securities available for sale	86,058	133,112
Proceeds from sales of investment securities available for sale	134	0
Proceeds from sale of VISA Class B shares	1,693	0
Purchases of investment securities available for sale	(146,484)	(114,060)
Proceeds from sale of stock of Federal Home Loan Bank	36,499	23,857
Purchases of stock of Federal Home Loan Bank	(35,180)	(29,115)
Loans made to customers, net of collections	(87,625)	(79,243)
Proceeds on sale of other real estate owned	263	486
Purchases of property and equipment	(926)	(1,223)
Earnest money payments	(2,000)	0
Investment in tax credit real estate	0	(1,230)
Net cash and cash equivalents used in investing activities	(147,568)	(67,416)
Cash Flows from Financing Activities
Net increase (decrease) in deposits	149,642	(13,927)
Net decrease in other short-term borrowings	(289,606)	(155,188)
Principal payments on short-term FHLB borrowings	(577,224)	(412,396)
Proceeds from the issuance of short-term FHLB borrowings	647,224	370,246
Principal payments on long-term FHLB borrowings	(500)	(103,067)
Proceeds from the issuance of long-term FHLB borrowings	190,000	305,000
Purchase of common stock	(4,521)	(7,518)
Proceeds from the issuance of common stock through the employee stock purchase plan	192	177
Dividends paid	(10,805)	(10,316)
Net cash and cash equivalents provided by (used in) financing activities	104,402	(26,989)
Decrease in cash and cash equivalents	(3)	(70,906)
Cash and cash equivalents:
Beginning of period	42,114	123,399
End of period	42,111	52,493
Cash payments for:
Interest paid to depositors	26,067	29,755
Interest paid on other obligations	10,959	18,161
Income taxes paid	13,557	5,211
Noncash activities:
Increase in maximum cash obligation related to ESOP shares	5,954	2,670
Transfers to other real estate owned	429	868
Sale and financing of other real estate owned	346	353
Property acquired through extinguishment of loan receivable	981	0
Tax credits acquired through extinguishment of loan receivable	2,353	0
Purchases of investment securities available for sale not settled	$ 2,960	$ 8,200

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2026	Dec. 31, 2025
ASSETS
Cash and cash equivalents	$ 42,111	$ 42,114
Investment securities available for sale at fair value (amortized cost June 30, 2026 $1,022,607; December 31, 2025 $957,295)	1,012,232	955,584
Stock of Federal Home Loan Bank	30,745	32,063
Loans held for sale	8,606	8,047
Loans, net of allowance for credit losses June 30, 2026 $54,921; December 31, 2025 $58,204	3,594,354	3,506,819
Property and equipment, net	36,780	36,040
Tax credit real estate	7,527	8,241
Accrued interest receivable	23,862	23,404
Deferred income taxes, net	20,606	18,467
Goodwill	2,500	2,500
Other assets	17,131	14,591
Total Assets	4,796,454	4,647,870
Liabilities
Noninterest-bearing deposits	627,802	596,230
Interest-bearing deposits	2,889,675	2,771,605
Total deposits	3,517,477	3,367,835
Other short-term borrowings, including FHLB daily reset advances	297,277	586,882
Federal Home Loan Bank borrowings	323,833	64,333
Accrued interest payable	3,715	3,453
Allowance for credit losses on off-balance sheet credit exposures	5,230	4,501
Other liabilities	19,594	18,157
Total Liabilities	4,167,126	4,045,161
Redeemable Common Stock Held by Employee Stock Ownership Plan (ESOP)	60,429	54,475
STOCKHOLDERS' EQUITY
Common stock, no par value; authorized 40,000,000 shares; issued June 30, 2026 20,677,074 shares; December 31, 2025 20,679,906 shares	0	0
Paid in capital	65,701	65,183
Retained earnings	666,218	629,068
Accumulated other comprehensive loss	(7,909)	(1,304)
Treasury stock at cost (June 30, 2026 3,205,977 shares; December 31, 2025 3,113,780 shares)	(94,682)	(90,238)
Total Stockholders' Equity	629,328	602,709
Less maximum cash obligation related to ESOP shares	60,429	54,475
Total Stockholders' Equity Less Maximum Cash Obligation Related to ESOP Shares	568,899	548,234
Total Liabilities & Stockholders' Equity	$ 4,796,454	$ 4,647,870