ISTR 10-Q Quarterly Report March 31, 2025

INVESTAR HOLDING CORP

10-Ks and 10-Qs

10-Q	Quarter ended Sept. 30, 2025
10-Q	Quarter ended June 30, 2025
10-Q	Quarter ended March 31, 2025
10-K	Fiscal year ended Dec. 31, 2024
10-Q	Quarter ended Sept. 30, 2024
10-Q	Quarter ended June 30, 2024
10-Q	Quarter ended March 31, 2024
10-K	Fiscal year ended Dec. 31, 2023
10-Q	Quarter ended Sept. 30, 2023
10-Q	Quarter ended June 30, 2023
10-Q	Quarter ended March 31, 2023
10-K	Fiscal year ended Dec. 31, 2022
10-Q	Quarter ended Sept. 30, 2022
10-Q	Quarter ended June 30, 2022
10-Q	Quarter ended March 31, 2022
10-K	Fiscal year ended Dec. 31, 2021
10-Q	Quarter ended Sept. 30, 2021
10-Q	Quarter ended June 30, 2021
10-Q	Quarter ended March 31, 2021
10-K	Fiscal year ended Dec. 31, 2020
10-Q	Quarter ended Sept. 30, 2020
10-Q	Quarter ended June 30, 2020
10-Q	Quarter ended March 31, 2020
10-K	Fiscal year ended Dec. 31, 2019
10-Q	Quarter ended Sept. 30, 2019
10-Q	Quarter ended June 30, 2019
10-Q	Quarter ended March 31, 2019
10-K	Fiscal year ended Dec. 31, 2018
10-Q	Quarter ended Sept. 30, 2018
10-Q	Quarter ended June 30, 2018
10-Q	Quarter ended March 31, 2018
10-K	Fiscal year ended Dec. 31, 2017
10-Q	Quarter ended Sept. 30, 2017
10-Q	Quarter ended June 30, 2017
10-Q	Quarter ended March 31, 2017
10-K	Fiscal year ended Dec. 31, 2016
10-Q	Quarter ended Sept. 30, 2016
10-Q	Quarter ended June 30, 2016
10-Q	Quarter ended March 31, 2016
10-K	Fiscal year ended Dec. 31, 2015
10-Q	Quarter ended Sept. 30, 2015
10-Q	Quarter ended June 30, 2015
10-Q	Quarter ended March 31, 2015
10-K	Fiscal year ended Dec. 31, 2014
10-Q	Quarter ended Sept. 30, 2014
10-Q	Quarter ended June 30, 2014

PROXIES

DEF 14A	Filed on May 21, 2025
DEF 14A	Filed on April 8, 2025
DEF 14A	Filed on May 15, 2024
DEF 14A	Filed on April 2, 2024
DEF 14A	Filed on May 17, 2023
DEF 14A	Filed on April 4, 2023
DEF 14A	Filed on May 18, 2022
DEF 14A	Filed on April 5, 2022
DEF 14A	Filed on April 6, 2021
DEF 14A	Filed on April 15, 2020
DEF 14A	Filed on April 10, 2019
DEF 14A	Filed on April 12, 2018
DEF 14A	Filed on April 24, 2017
DEF 14A	Filed on April 18, 2016
DEF 14A	Filed on April 17, 2015

istr20250331_10q.htm

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

_____________________________________

FORM 10-Q

_____________________________________

(Mark One)

☒

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-36522

Investar Holding Corporation

(Exact name of registrant as specified in its charter)

Louisiana			27-1560715
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

10500 Coursey Boulevard , Baton Rouge , Louisiana 70816

(Address of principal executive offices, including zip code)

( 225 ) 227-2222

(Registrant ’ s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Common stock, $1.00 par value per share			ISTR			The Nasdaq Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the issuer’s class of common stock, as of the latest practicable date, is as follows: Common stock, $1.00 par value, 9,844,848 shares outstanding as of May 5, 2025.

Table of Contents

TABLE OF CONTENTS

Part I. Financial Information

Item 1.	Financial Statements (Unaudited)	4
	Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024	4
	Consolidated Statements of Income for the three months ended March 31, 2025 and 2024	5
	Consolidated Statements of Comprehensive Income for the three months ended March 31, 2025 and 2024	6
	Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2025 and 2024	7
	Consolidated Statements of Cash Flows for the three months ended March 31, 2025 and 2024	8
	Notes to the Consolidated Financial Statements	10
	Note 1. Summary of Significant Accounting Policies	10
	Note 2. Earnings Per Share	11
	Note 3. Investment Securities	12
	Note 4. Loans and Allowance for Credit Losses	15
	Note 5. Stockholders’ Equity	24
	Note 6. Derivative Financial Instruments	25
	Note 7. Fair Values of Financial Instruments	26
	Note 8. Income Taxes	31
	Note 9. Commitments and Contingencies	31
	Note 10. Leases	32
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	54
Item 4.	Controls and Procedures	54

Part II. Other Information

Item 1A.	Risk Factors	55
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	55
Item 6.	Exhibits	57
Signatures		58

Table of Contents

GLOSSARY OF DEFINED TERMS

Below is a listing of certain acronyms, abbreviations and defined terms, among others, used throughout this Quarterly Report on Form 10-Q.

2029 Notes	–	5.125% Fixed-to-Floating Rate Subordinated Notes due 2029
2032 Notes	–	5.125% Fixed-to-Floating Rate Subordinated Notes due 2032
ACL	–	Allowance for Credit Losses
AFS	–	Available For Sale
ALCO	–	Asset/Liability Committee
Annual Report	–	Investar Holding Corporation’s Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on March 12, 2025
ASC	–	Accounting Standards Codification
ASU	–	Accounting Standards Update
ATM	–	Automated Teller Machine
Bank	–	Investar Bank, National Association
Board	–	Board of Directors of Investar Holding Corporation
BOLI	–	Bank Owned Life Insurance
BTFP	–	Bank Term Funding Program
CECL	–	Current Expected Credit Loss
CODM	–	Chief Operating Decision Maker
Company	–	Investar Holding Corporation and its wholly-owned subsidiary the Bank (also, “we,” “our,” or “us”)
FASB	–	Financial Accounting Standards Board
FDIC	–	Federal Deposit Insurance Corporation
FHLB	–	Federal Home Loan Bank
FRB	–	Federal Reserve Bank of Atlanta
GAAP	–	U.S. Generally Accepted Accounting Principles
HTM	–	Held To Maturity
MD&A	–	Management’s Discussion and Analysis of Financial Condition and Results of Operations
NAICS	–	North American Industry Classification System
OCC	–	Office of the Comptroller of the Currency
ROU	–	Right-Of-Use
RSU	–	Restricted Stock Unit
SEC	–	U.S. Securities and Exchange Commission
SBIC	–	Small Business Investment Company
SOFR	–	Secured Overnight Financing Rate
U.S.	–	United States

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

INVESTAR HOLDING CORPORATION

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share data)

	*March 31, 2025*			*December 31, 2024*
	(Unaudited)
ASSETS
Cash and due from banks	$	26,279		$	26,623
Interest-bearing balances due from other banks		17,243			1,299
Cash and cash equivalents		43,522			27,922

Available for sale securities at fair value (amortized cost of $ 400,211 and $ 392,564 , respectively)		345,728			331,121
Held to maturity securities at amortized cost (estimated fair value of $ 42,720 and $ 42,144 , respectively)		42,268			42,687
Loans		2,106,631			2,125,084
Less: allowance for credit losses		( 26,435	)		( 26,721	)
Loans, net		2,080,196			2,098,363
Equity securities at fair value		2,517			2,593
Nonmarketable equity securities		14,297			16,502
Bank premises and equipment, net of accumulated depreciation of $ 22,259 and $ 21,853 , respectively		40,350			40,705
Other real estate owned, net		6,169			5,218
Accrued interest receivable		15,264			14,423
Deferred tax asset		15,646			17,120
Goodwill and other intangible assets, net		41,558			41,696
Bank owned life insurance		60,151			59,703
Other assets		22,236			24,759
Total assets	$	2,729,902		$	2,722,812

LIABILITIES
Deposits:
Noninterest-bearing	$	436,735		$	432,143
Interest-bearing		1,910,622			1,913,801
Total deposits		2,347,357			2,345,944
Advances from Federal Home Loan Bank		60,000			67,215
Repurchase agreements		11,302			8,376
Subordinated debt, net of unamortized issuance costs		16,707			16,697
Junior subordinated debt		8,758			8,733
Accrued taxes and other liabilities		34,041			34,551
Total liabilities		2,478,165			2,481,516

Commitments and contingencies (Note 9)

STOCKHOLDERS’ EQUITY
Preferred stock, no par value per share; 5,000,000 shares authorized; none issued or outstanding		—			—
Common stock, $ 1.00 par value per share; 40,000,000 shares authorized; 9,821,446 and 9,828,413 shares issued and outstanding, respectively		9,821			9,828
Surplus		146,598			146,890
Retained earnings		138,197			132,935
Accumulated other comprehensive loss		( 42,879	)		( 48,357	)
Total stockholders’ equity		251,737			241,296
Total liabilities and stockholders’ equity	$	2,729,902		$	2,722,812

See accompanying notes to the consolidated financial statements.

Table of Contents

INVESTAR HOLDING CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(Amounts in thousands, except share data)

(Unaudited)

	*Three months ended March 31,*
	*2025*			*2024*
INTEREST INCOME
Interest and fees on loans	$	30,552		$	32,135
Interest on investment securities:
Taxable		2,679			2,817
Tax-exempt		671			238
Other interest income		532			532
Total interest income		34,434			35,722

INTEREST EXPENSE
Interest on deposits		14,640			14,845
Interest on borrowings		1,449			3,661
Total interest expense		16,089			18,506
Net interest income		18,345			17,216

Provision for credit losses		( 3,596	)		( 1,419	)
Net interest income after provision for credit losses		21,941			18,635

NONINTEREST INCOME
Service charges on deposit accounts		795			810
(Loss) gain on sale or disposition of fixed assets, net		( 3	)		427
Interchange fees		390			395
Income from bank owned life insurance		448			388
Change in the fair value of equity securities		( 76	)		80
Other operating income		457			648
Total noninterest income		2,011			2,748
Income before noninterest expense		23,952			21,383

NONINTEREST EXPENSE
Depreciation and amortization		721			812
Salaries and employee benefits		9,603			9,248
Occupancy		641			581
Data processing		897			937
Marketing		111			41
Professional fees		591			419
Gain on early extinguishment of subordinated debt		—			( 215	)
Other operating expenses		3,674			3,473
Total noninterest expense		16,238			15,296
Income before income tax expense		7,714			6,087
Income tax expense		1,421			1,380
Net income	$	6,293		$	4,707

EARNINGS PER SHARE
Basic earnings per share	$	0.64		$	0.48
Diluted earnings per share		0.63			0.48
Cash dividends declared per common share		0.105			0.10

See accompanying notes to the consolidated financial statements.

Table of Contents

INVESTAR HOLDING CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Amounts in thousands)

(Unaudited)

	*Three months ended March 31,*
	*2025*		*2024*
Net income	$	6,293	$	4,707
Other comprehensive income (loss):
Investment securities:
Unrealized gain (loss), available for sale, net of tax expense (benefit) of $ 1,482 and ($ 1,031 ), respectively		5,478		( 3,810	)
Total other comprehensive income (loss)		5,478		( 3,810	)
Total comprehensive income	$	11,771	$	897

See accompanying notes to the consolidated financial statements.

Table of Contents

INVESTAR HOLDING CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS ’ EQUITY

(Amounts in thousands, except share data)

(Unaudited)

										*Accumulated*
										*Other*			*Total*
	*Common*						*Retained*			*Comprehensive*			*Stockholders’*
	*Stock*			*Surplus*			*Earnings*			*(Loss) Income*			*Equity*
Three months ended:
March 31, 2024
Balance at beginning of period	$	9,748		$	145,456		$	116,711		$	( 45,147	)	$	226,768
Surrendered shares		( 7	)		( 108	)		—			—			( 115	)
Options exercised		14			182			—			—			196
Dividends declared, $ 0.10 per share		—			—			( 977	)		—			( 977	)
Stock-based compensation		38			371			—			—			409
Shares repurchased		( 11	)		( 162	)		—			—			( 173	)
Net income		—			—			4,707			—			4,707
Other comprehensive loss, net		—			—			—			( 3,810	)		( 3,810	)
Balance at end of period	$	9,782		$	145,739		$	120,441		$	( 48,957	)	$	227,005

March 31, 2025
Balance at beginning of period	$	9,828		$	146,890		$	132,935		$	( 48,357	)	$	241,296
Surrendered shares		( 32	)		( 540	)		—			—			( 572	)
Options exercised		30			442			—			—			472
Dividends declared, $ 0.105 per share		—			—			( 1,031	)		—			( 1,031	)
Stock-based compensation		30			420			—			—			450
Shares repurchased		( 35	)		( 614	)		—			—			( 649	)
Net income		—			—			6,293			—			6,293
Other comprehensive income, net		—			—			—			5,478			5,478
Balance at end of period	$	9,821		$	146,598		$	138,197		$	( 42,879	)	$	251,737

See accompanying notes to the consolidated financial statements.

Table of Contents

INVESTAR HOLDING CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

(Unaudited)

	*Three months ended March 31,*
	*2025*			*2024*
Net income	$	6,293		$	4,707
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		721			812
Provision for credit losses		( 3,596	)		( 1,419	)
Net amortization (accretion) of purchase accounting adjustments		11			( 25	)
Provision for other real estate owned		—			233
Net (accretion) amortization of securities		( 54	)		15
Loss (gain) on sale or disposition of fixed assets, net		3			( 427	)
Gain on early extinguishment of subordinated debt		—			( 215	)
FHLB stock dividend		( 70	)		( 53	)
Stock-based compensation		450			409
Deferred taxes		( 8	)		163
Net change in value of bank owned life insurance		( 448	)		( 388	)
Amortization of subordinated debt issuance costs		10			46
Change in the fair value of equity securities		76			( 80	)
Net change in:
Accrued interest receivable		( 840	)		( 681	)
Other assets		416			1,059
Accrued taxes and other liabilities		1,514			3,674
Net cash provided by operating activities		4,478			7,830

Cash flows from investing activities:
Purchases of securities available for sale		( 17,345	)		( 5,411	)
Proceeds from maturities, prepayments and calls of investment securities available for sale		9,752			9,134
Proceeds from maturities, prepayments and calls of investment securities held to maturity		417			2,716
Proceeds from redemption or sale of nonmarketable equity securities		2,315			1,683
Purchases of nonmarketable equity securities		( 40	)		( 936	)
Purchases of equity securities at fair value		—			( 1,000	)
Net decrease in loans		20,821			30,012
Proceeds from sales of fixed assets		—			1,340
Purchases of fixed assets		( 215	)		( 112	)
Proceeds from surrender of bank owned life insurance		—			8,440
Purchases of bank owned life insurance		—			( 10,000	)
Purchases of other investments		( 50	)		( 40	)
Distributions from investments		20			69
Net cash provided by investing activities		15,675			35,895

Table of Contents

INVESTAR HOLDING CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS, CONTINUED

(Amounts in thousands)

(Unaudited)

Cash flows from financing activities:
Net increase (decrease) in customer deposits		1,417			( 47,867	)
Net increase (decrease) in repurchase agreements		2,926			( 783	)
Net decrease in short-term FHLB advances		( 7,215	)		—
Net increase in borrowings under the Bank Term Funding Program		—			16,500
Cash dividends paid on common stock		( 1,032	)		( 975	)
Proceeds from stock options exercised		—			196
Payments to repurchase common stock		( 649	)		( 173	)
Extinguishment of subordinated debt		—			( 787	)
Net cash used in financing activities		( 4,553	)		( 33,889	)
Net change in cash and cash equivalents		15,600			9,836
Cash and cash equivalents, beginning of period		27,922			32,009
Cash and cash equivalents, end of period	$	43,522		$	41,845

SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING ACTIVITIES
Transfer from loans to other real estate owned	$	951		$	42

See accompanying notes to the consolidated financial statements.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

The Company is a financial holding company, headquartered in Baton Rouge, Louisiana that provides full banking services, excluding trust services, through its wholly-owned banking subsidiary, Investar Bank, National Association, a national bank, primarily to meet the needs of individuals, professionals and small to me dium-sized businesses. The Company’s primary markets are in south Louisiana, southeast Texas and Alabama. At March 31, 2025 , the Company operated 20 full service branches located in Louisiana, three full service branches located in Texas and six full service branches located in Alabama and had 329 full-time e quivalent employees.

Basis of Presentation

The accompanying unaudited consolidated financial statements of the Company have been prepared in accordance with GAAP for interim financial information and the instructions to Form 10 -Q and Article 10 of Regulation S- X. Accordingly, they do not include information or footnotes necessary for a complete presentation of financial position, results of operations, and cash flows in conformity with GAAP. However, in the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the financial statements have been included. The results of operations for the three month period ended March 31, 2025 are not necessarily indicative of the results that may be expected for the entire fiscal year. These statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2024 , including the notes thereto, which were included as part of the Company’s Annual Report.

Prior period consolidated financial statements are reclassified whenever necessary to conform to the current period presentation. No reclassifications of prior period balances were material to the consolidated financial statements.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, the Bank. All significant intercompany accounts and transactions have been eliminated in consolidation.

Segment Reporting

The Company determined that all of its banking operations serve a similar customer base, offer similar products and services, and are managed through similar processes. Therefore, the Company’s banking operations are aggregated into one reportable operating segment, which generates income principally from interest on loans and, to a lesser extent, securities investments, as well as from fees charged in connection with various loan and deposit services. The CODM is the Chief Executive Officer, who for the purposes of assessing performance, making operating decisions, and allocating Company resources, regularly reviews net income as reported in the accompanying consolidated statements of income. The level of disaggregation and amounts of significant segment income and expenses that are regularly provided to the CODM are the same as those presented in the accompanying consolidated statements of income. Likewise, the measure of segment assets is reported on the accompanying consolidated balance sheets as total assets.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates, and such differences could be material.

Material estimates that are particularly susceptible to significant change relate to the determination of the ACL. While management uses available information to recognize credit losses on loans, future additions to the ACL may be necessary based on changes in economic conditions, changes in conditions of borrowers’ industries or changes in the condition of individual borrowers. In addition, regulatory agencies, as an integral part of their examination process, periodically review the Company’s ACL. Such agencies may require the Company to recognize additions to the ACL based on their judgments about information available to them at the time of their examination. Because of these factors, it is reasonably possible that the ACL may change materially in the near term. However, the amount of the change that is reasonably possible cannot be estimated.

Other estimates that are susceptible to significant change in the near term relate to the allowance for off-balance sheet credit losses, the fair value of stock-based compensation awards, the determination of other-than-temporary impairments of securities, and the fair value of financial instruments and goodwill. A changing interest rate environment, elevated levels of inflation and changing U.S. trade and tariff policies have made certain estimates more challenging, including those discussed above.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Accounting Standards Adopted in 2025

FASB ASC Topic 740 “ Income Taxes - Improvements to Income Tax Disclosures ” Update No. 2023 - 09 ( “ ASU 2023 - 09 ”). In December 2023, the FASB issued ASU 2023 - 09, which enhances the transparency and decision usefulness of income tax disclosures. ASU 2023 - 09 requires disclosure of additional categories of information about federal, state and foreign income taxes in the rate reconciliation table and requires companies to provide more information about the reconciling items in some categories if a quantitative threshold is met. ASU 2023 - 09 became effective for the Company on January 1, 2025. The Company will provide the required disclosures in its Annual Report on Form 10 -K for the year ended December 31, 2025, and the adoption of ASU 2023 - 09 is not expected to have a material impact on the Company’s consolidated financial statements.

Recent Accounting Pronouncements

FASB “ Disclosure Improvements ” Update No. 2023 - 06 ( “ ASU 2023 - 06 ”). In October 2023, the FASB issued ASU 2023 - 06, which amends the disclosure or presentation requirements related to various topics. The amendment is intended to align GAAP with the SEC’s regulations. ASU 2023 - 06 is required to be applied prospectively, and early adoption is prohibited. For reporting entities subject to the SEC’s existing disclosure requirements, the effective dates of ASU 2023 - 06 will be the date on which the SEC’s removal of that related disclosure requirement from Regulation S- X or Regulation S-K becomes effective. If by June 30, 2027, the SEC has not removed the applicable requirement from Regulation S- X or Regulation S-K, the pending content of the related amendment will be removed and will not become effective for any entities. ASU 2023 - 06 is not expected to have a material impact on the Company’s consolidated financial statements.

FASB ASC Topic 220 “ Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures: Disaggregation of Income Statement Expenses ” Update No. 2024 - 03 ( “ ASU 2024 - 03 ”). In November 2024, the FASB issued ASU 2024 - 03, which requires disaggregated disclosure of income statement expenses in a tabular format in the notes of the financial statements for public business entities. ASU 2024 - 03 is effective on a prospective basis for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027, with early adoption and retrospective application permitted. The Company is currently evaluating the provisions of the amendment and the impact on its future consolidated financial statements.

NOTE 2. EARNINGS PER SHARE

The following is a summary of the information used in the computation of basic and diluted earnings per common share for the three months ended March 31, 2025 and 2024 (in thousands, except share data).

	*Three months ended March 31,*
	*2025*		*2024*
Earnings per common share – basic
Net income allocated to common shareholders	$	6,293	$	4,707
Weighted average basic shares outstanding		9,832,625		9,769,626
Basic earnings per common share	$	0.64	$	0.48

Earnings per common share – diluted
Net income allocated to common shareholders	$	6,293	$	4,707
Weighted average basic shares outstanding		9,832,625		9,769,626
Dilutive effect of securities		128,315		97,347
Total weighted average diluted shares outstanding		9,960,940		9,866,973
Diluted earnings per common share	$	0.63	$	0.48

The weighted average shares that have an antidilutive effect in the calculation of diluted earnings per common share and have been excluded from the computations above are shown below.

	*Three months ended March 31,*
	*2025*		*2024*
Stock options		4,122		2,619
RSUs		85		1,699

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 3. INVESTMENT SECURITIES

Debt Securities

The amortized cost and approximate fair value of investment securities classified as AFS are summarized below as of the dates presented (dollars in thousands).

			*Gross*		*Gross*
			*Unrealized*		*Unrealized*			*Fair*
	*Amortized Cost*		*Gains*		*Losses*			*Value*
March 31, 2025
Obligations of the U.S. Treasury and U.S. government agencies and corporations	$	15,590	$	37	$	( 254	)	$	15,373
Obligations of state and political subdivisions		17,428		—		( 2,021	)		15,407
Corporate bonds		30,610		29		( 2,105	)		28,534
Residential mortgage-backed securities		264,509		90		( 42,501	)		222,098
Commercial mortgage-backed securities		72,074		190		( 7,948	)		64,316
Total	$	400,211	$	346	$	( 54,829	)	$	345,728

			*Gross*		*Gross*
			*Unrealized*		*Unrealized*			*Fair*
	*Amortized Cost*		*Gains*		*Losses*			*Value*
December 31, 2024
Obligations of the U.S. Treasury and U.S. government agencies and corporations	$	15,985	$	47	$	( 325	)	$	15,707
Obligations of state and political subdivisions		18,363		—		( 2,243	)		16,120
Corporate bonds		29,772		8		( 2,513	)		27,267
Residential mortgage-backed securities		256,272		39		( 47,543	)		208,768
Commercial mortgage-backed securities		72,172		133		( 9,046	)		63,259
Total	$	392,564	$	227	$	( 61,670	)	$	331,121

The Company calculates realized gains and losses on sales of debt securities under the specific identification method. Procee ds from sales of investment securities classified as AFS and gross gains and losses are summarized below for the periods presented (dollars in thousands).

	*Three months ended March 31,*
	*2025*		*2024*
Proceeds from sales	$	—	$	—
Gross gains	$	—	$	—
Gross losses	$	—	$	—

The amortized cost and approximate fair value of investment securities classified as HTM are summarized below as of the dates presented (dollars in thousands).

			*Gross*		*Gross*
			*Unrealized*		*Unrealized*			*Fair*
	*Amortized Cost*		*Gains*		*Losses*			*Value*
March 31, 2025
Obligations of state and political subdivisions	$	40,221	$	1,025	$	( 367	)	$	40,879
Residential mortgage-backed securities		2,047		—		( 206	)		1,841
Total	$	42,268	$	1,025	$	( 573	)	$	42,720

			*Gross*		*Gross*
			*Unrealized*		*Unrealized*			*Fair*
	*Amortized Cost*		*Gains*		*Losses*			*Value*
December 31, 2024
Obligations of state and political subdivisions	$	40,618	$	70	$	( 365	)	$	40,323
Residential mortgage-backed securities		2,069		—		( 248	)		1,821
Total	$	42,687	$	70	$	( 613	)	$	42,144

Securities are classified in the consolidated balance sheets according to management’s intent. The Company had no securities classified as trading as of March 31, 2025 or December 31, 2024 .

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The approximate fair value of AFS securities and unrealized losses, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, are summarized below as of the dates presented (dollars in thousands).

	*Less than 12 Months*					*12 Months or More*					*Total*
			*Unrealized*					*Unrealized*					*Unrealized*
	*Fair Value*		*Losses*			*Fair Value*		*Losses*			*Fair Value*		*Losses*
March 31, 2025
Obligations of the U.S. Treasury and U.S. government agencies and corporations	$	5,887	$	( 4	)	$	3,642	$	( 250	)	$	9,529	$	( 254	)
Obligations of state and political subdivisions		3,393		( 133	)		12,014		( 1,888	)		15,407		( 2,021	)
Corporate bonds		2,148		( 10	)		23,045		( 2,095	)		25,193		( 2,105	)
Residential mortgage-backed securities		12,769		( 74	)		199,202		( 42,427	)		211,971		( 42,501	)
Commercial mortgage-backed securities		8,035		( 80	)		41,880		( 7,868	)		49,915		( 7,948	)
Total	$	32,232	$	( 301	)	$	279,783	$	( 54,528	)	$	312,015	$	( 54,829	)

	*Less than 12 Months*					*12 Months or More*					*Total*
			*Unrealized*					*Unrealized*					*Unrealized*
	*Fair Value*		*Losses*			*Fair Value*		*Losses*			*Fair Value*		*Losses*
December 31, 2024
Obligations of the U.S. Treasury and U.S. government agencies and corporations	$	5,505	$	( 20	)	$	4,012	$	( 305	)	$	9,517	$	( 325	)
Obligations of state and political subdivisions		3,434		( 99	)		12,686		( 2,144	)		16,120		( 2,243	)
Corporate bonds		1,947		( 5	)		24,326		( 2,508	)		26,273		( 2,513	)
Residential mortgage-backed securities		5,432		( 103	)		198,803		( 47,440	)		204,235		( 47,543	)
Commercial mortgage-backed securities		9,226		( 134	)		42,293		( 8,912	)		51,519		( 9,046	)
Total	$	25,544	$	( 361	)	$	282,120	$	( 61,309	)	$	307,664	$	( 61,670	)

At March 31, 2025 , 688 o f the Company’s AFS debt securities had unrealized losses totaling 14.9 % of the individual securities’ amortized cost basis and 13.7 % of the Company’s total amortized cost basis of the AFS investment securities portfolio. At such date, 623 of the 688 securities had been in a continuous loss position for over 12 months.

The approximate fair value of HTM securities, and unrealized losses, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, are summarized below as of the dates presented (dollars in thousands).

	*Less than 12 Months*					*12 Months or More*					*Total*
			*Unrealized*					*Unrealized*					*Unrealized*
	*Fair Value*		*Losses*			*Fair Value*		*Losses*			*Fair Value*		*Losses*
March 31, 2025
Obligations of state and political subdivisions	$	9,227	$	( 277	)	$	2,387	$	( 90	)	$	11,614	$	( 367	)
Residential mortgage-backed securities		—		—			1,841		( 206	)		1,841		( 206	)
Total	$	9,227	$	( 277	)	$	4,228	$	( 296	)	$	13,455	$	( 573	)

	*Less than 12 Months*					*12 Months or More*					*Total*
			*Unrealized*					*Unrealized*					*Unrealized*
	*Fair Value*		*Losses*			*Fair Value*		*Losses*			*Fair Value*		*Losses*
December 31, 2024
Obligations of state and political subdivisions	$	10,795	$	( 209	)	$	2,458	$	( 156	)	$	13,253	$	( 365	)
Residential mortgage-backed securities		—		—			1,821		( 248	)		1,821		( 248	)
Total	$	10,795	$	( 209	)	$	4,279	$	( 404	)	$	15,074	$	( 613	)

Unrealized losses are generally due to changes in market interest rates. The Company has the intent to hold these securities either until maturity or a forecasted recovery, and it is more likely than not that the Company will not have to sell the securities before the recovery of their amortized cost basis. Due to the nature of the investments, current market prices, and the current interest rate environment, the Company determined that these declines were not attributable to credit losses at March 31, 2025 or December 31, 2024 .

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The amortized cost and approximate fair value of investment debt securities, by contractual maturity, are shown below as of March 31, 2025 (dollars in thousands). Actual maturities may differ from contractual maturities due to mortgage-backed securities whereby borrowers may have the right to call or prepay obligations with or without call or prepayment penalties and certain callable bonds whereby the issuer has the option to call the bonds prior to contractual maturity.

	*Available for Sale*				*Held to Maturity*
	*Amortized*		*Fair*		*Amortized*		*Fair*
	*Cost*		*Value*		*Cost*		*Value*
March 31, 2025
Due within one year	$	6,050	$	6,032	$	—	$	—
Due after one year through five years		27,220		26,738		2,477		2,387
Due after five years through ten years		29,903		27,572		2,740		2,792
Due after ten years		337,038		285,386		37,051		37,541
Total debt securities	$	400,211	$	345,728	$	42,268	$	42,720

Accrued interest receivable on the Company ’ s investment securities was $ 2.4 million and $ 1.9 million at March 31, 2025 and December 31, 2024 , respectively, and is included in “ Accrued interest receivable ” on the accompanying consolidated balance sheets.

At March 31, 2025 , securities with a carrying value of $ 67.4 million were pledged to secure certain deposits, borrowings, and other liabilities, compared to $ 68.1 million in pledged securities at December 31, 2024 .

Equity Securities

Equity securities at fair value include marketable securities in corporate stocks and mutual funds and totaled $ 2.5 million and $ 2.6 million at March 31, 2025 and December 31, 2024 , respectively.

Nonmarketable equity securities primarily consist of FHLB stock and FRB stock. Members of the FHLB and FRB are required to own a certain amount of stock based on the level of borrowings and other factors and may invest in additional amounts. FHLB stock and FRB stock are carried at cost, restricted as to redemption, and periodically evaluated for impairment based on the ultimate recovery of par value. Both cash and stock dividends are reported as income. Nonmarketable equity securities also include investments in other correspondent banks including Independent Bankers Financial Corporation and First National Bankers Bank stock. These investments are carried at cost which approximates fair value. The balance of nonmarketable equity securities at March 31, 2025 and December 31, 2024 was $ 14.3 million and $ 16.5 million, respectively.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES

The Company’s loan portfolio consists of the following categories of loans as of the dates presented (dollars in thousands).

	*March 31, 2025*		*December 31, 2024*
Construction and development	$	149,275	$	154,553
1-4 Family		394,735		396,815
Multifamily		103,248		84,576
Farmland		6,718		6,977
Commercial real estate		931,868		944,548
Total mortgage loans on real estate		1,585,844		1,587,469
Commercial and industrial		510,765		526,928
Consumer		10,022		10,687
Total loans	$	2,106,631	$	2,125,084

Interest on loans is calculated by using the simple interest method on daily balances of the principal amount outstanding. Loan origination fees, net of direct loan origination costs and commitment fees, are deferred and amortized as an adjustment to yield over the life of the loan, or over the commitment period, as applicable. Unamortized premiums and discounts on loans, included in the total loans balances above, were $ 0.1 million at both March 31, 2025 and December 31, 2024 , and unearned income, or deferred fees, on loans was $ 0.9 million and $ 1.0 million at March 31, 2025 and December 31, 2024 , respectively, and is also included in the total loans balance in the table above.

The tables below provide an analysis of the aging of loans as of March 31, 2025 and December 31, 2024 (dollars in thousands).

	*March 31, 2025*
	*Current*		*30 - 59 Days Past Due*		*60 - 89 Days Past Due*		*90 Days or More Past Due*		*Total*		*> 90 Days and Accruing*
Construction and development	$	149,252	$	17	$	—	$	6	$	149,275	$	—
1-4 Family		387,023		5,084		496		2,132		394,735		—
Multifamily		103,248		—		—		—		103,248		—
Farmland		6,718		—		—		—		6,718		—
Commercial real estate		930,822		210		719		117		931,868		—
Total mortgage loans on real estate		1,577,063		5,311		1,215		2,255		1,585,844		—
Commercial and industrial		510,631		131		—		3		510,765		—
Consumer		9,773		31		61		157		10,022		—
Total loans	$	2,097,467	$	5,473	$	1,276	$	2,415	$	2,106,631	$	—

	*December 31, 2024*
	*Current*		*30 - 59 Days Past Due*		*60 - 89 Days Past Due*		*90 Days or More Past Due*		*Total*		*> 90 Days and Accruing*
Construction and development	$	154,461	$	86	$	—	$	6	$	154,553	$	—
1-4 Family		387,782		5,200		1,054		2,779		396,815		—
Multifamily		84,576		—		—		—		84,576		—
Farmland		6,977		—		—		—		6,977		—
Commercial real estate		942,493		458		48		1,549		944,548		—
Total mortgage loans on real estate		1,576,289		5,744		1,102		4,334		1,587,469		—
Commercial and industrial		526,329		64		270		265		526,928		—
Consumer		10,377		87		65		158		10,687		2
Total loans	$	2,112,995	$	5,895	$	1,437	$	4,757	$	2,125,084	$	2

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The tables below provide an analysis of nonaccrual loans as of March 31, 2025 and December 31, 2024 (dollars in thousands).

	*March 31, 2025*
	*Nonaccrual with No Allowance for Credit Loss*		*Nonaccrual with an Allowance for Credit Loss*		*Total Nonaccrual Loans*
Construction and development	$	23	$	—	$	23
1-4 Family		989		1,973		2,962
Multifamily		—		—		—
Farmland		—		—		—
Commercial real estate		417		1,830		2,247
Total mortgage loans on real estate		1,429		3,803		5,232
Commercial and industrial		139		—		139
Consumer		194		20		214
Total loans	$	1,762	$	3,823	$	5,585

	*December 31, 2024*
	*Nonaccrual with No Allowance for Credit Loss*		*Nonaccrual with an Allowance for Credit Loss*		*Total Nonaccrual Loans*
Construction and development	$	24	$	—	$	24
1-4 Family		1,475		2,336		3,811
Multifamily		—		—		—
Farmland		—		—		—
Commercial real estate		4,168		123		4,291
Total mortgage loans on real estate		5,667		2,459		8,126
Commercial and industrial		252		230		482
Consumer		211		5		216
Total loans	$	6,130	$	2,694	$	8,824

Nonaccrual and Past Due Loans

Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due. Loans are placed on nonaccrual status when, in management’s opinion, the borrower may be unable to meet payment obligations as they become due, as well as when required by regulatory provisions. In determining whether or not a borrower may be unable to meet payment obligations for each class of loans, the borrower’s debt service capacity is considered through the analysis of current financial information, if available, and/or current information with regard to the collateral position. Regulatory provisions would typically require the placement of a loan on nonaccrual status if (i) principal or interest has been in default for a period of 90 days or more unless the loan is both well secured and in the process of collection or (ii) full payment of principal and interest is not expected. Loans may be placed on nonaccrual status regardless of whether or not such loans are considered past due. When interest accrual is discontinued, all unpaid accrued interest is reversed. Interest income on nonaccrual loans is recognized only to the extent that cash payments are received in excess of principal due. A loan may be returned to accrual status when all the principal and interest amounts contractually due are brought current and payment of future principal and interest amounts contractually due are reasonably assured, which is typically evidenced by a sustained period (at least six months) of repayment performance by the borrower. No material interest income was recognized in the consolidated statements of income on nonaccrual loans for the three months ended March 31, 2025 and 2024 .

Collateral Dependent Loans

Collateral dependent loans are loans for which the repayments, on the basis of the Company ’ s assessment at the reporting date, are expected to be provided substantially through the operation or sale of the collateral and the borrower is experiencing financial difficulty. Loans that do not share risk characteristics are excluded from the loan pools and evaluated on an individual basis, and the Company has determined to evaluate collateral dependent loans individually for impairment. The ACL for collateral dependent loans is measured based on the difference between the fair value of the collateral and the amortized cost basis of the asset as of the measurement date. When repayment is expected to be from the operation of the collateral, expected credit losses are calculated as the amount by which the amortized cost basis of the financial asset exceeds the present value of expected cash flows from the operation of the collateral. When repayment is expected to be from the sale of the collateral, expected credit losses are calculated as the amount by which the amortized costs basis of the financial asset exceeds the fair value of the underlying collateral less estimated cost to sell. The Company ’ s collateral dependent loans include all nonaccrual loans shown in the tables above at March 31, 2025 and December 31, 2024 . The types of collateral that secure collateral dependent loans are discussed under “Portfolio Segment Risk Factors” below.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Portfolio Segment Risk Factors

The following describes the risk characteristics relevant to each of the Company’s loan portfolio segments.

Constructio n and Development - Construction and development loans are generally made for the purpose of acquisition and development of land to be improved through the construction of commercial and residential buildings. The successful repayment of these types of loans is generally dependent upon a commitment for permanent financing from the Company, or from the sale of the constructed property. These loans carry more risk than commercial or residential real estate loans due to the dynamics of construction projects, changes in interest rates, the long-term financing market, and state and local government regulations. One such risk is that loan funds are advanced upon the security of the property under construction, which is of uncertain value prior to the completion of construction. Thus, it is more difficult to evaluate accurately the total loan funds required to complete a project and to calculate related loan-to-value ratios. The Company attempts to minimize the risks associated with construction lending by limiting loan-to-value ratios as described above. In addition, as to speculative development loans, the Company generally makes such loans only to borrowers that have a positive pre-existing relationship with us. The Company manages risk by using specific underwriting policies and procedures for these types of loans and by avoiding excessive concentrations in any one business or industry. Construction and development loans are primarily secured by residential and commercial properties, which are under construction and/or redevelopment.

1 - 4 Family - The 1 - 4 family portfolio mainly consists of residential mortgage loans to consumers to finance a primary residence. The majority of these loans are secured by first liens on residential properties located in the Company’s market areas and carry risks associated with the creditworthiness of the borrower and changes in the value of the collateral and loan-to-value-ratios. The Company manages these risks through policies and procedures such as limiting loan-to-value ratios at origination, employing experienced underwriting personnel, requiring standards for appraisers, and not making subprime loans. In the third quarter of 2023, the Company exited the consumer mortgage origination business.

Multifamily - Multifamily loans are normally made to real estate investors to support permanent financing for multifamily residential income producing properties that rely on the successful operation of the property for repayment. This management mainly involves property maintenance and collection of rents due from tenants. This type of lending carries a lower level of risk, as compared to other commercial lending. In addition, underwriting requirements for multifamily properties are stricter than for other nonowner-occupied property types. The Company manages this risk by avoiding concentrations with any particular customer. Multifamily loans are primarily secured by first liens on multifamily real estate.

Farmland - Farmland loans are often for land improvements related to agricultural endeavors and may include construction of new specialized facilities. These loans are usually repaid through the conversion to permanent financing, or if scheduled loan amortization begins, for the long-term benefit of the borrower’s ongoing operations. Underwriting generally involves intensive analysis of the financial strength of the borrower and guarantor, liquidation value of the subject collateral, the associated unguaranteed exposure, and any available secondary sources of repayment, with the greatest emphasis given to a borrower’s capacity to meet cash flow coverage requirements as set forth by Company policies. Farmland loans are primarily secured by raw land.

Commercial Real Estate - Commercial real estate loans are extensions of credit secured by owner occupied and nonowner-occupied collateral. Underwriting generally involves intensive analysis of the financial strength of the borrower and guarantor, liquidation value of the subject collateral, the associated unguaranteed exposure, and any available secondary sources of repayment, with the greatest emphasis given to a borrower’s capacity to meet cash flow coverage requirements as set forth by Company policies. Commercial real estate loans typically depend on the successful operation and management of the businesses that occupy these properties or the financial stability of tenants occupying the properties. Nonowner-occupied commercial real estate loans typically are dependent, in large part, on the owner’s ability to rent the property and the ability of the tenants to pay rent, whereas owner-occupied commercial real estate loans typically are dependent, in large part, on the success of the owner’s business. General market conditions and economic activity may impact the performance of these types of loans, including fluctuations in the value of real estate, new job creation trends, and tenant vacancy rates. The Company attempts to limit risk by analyzing a borrower’s cash flow and collateral value on an ongoing basis. The Company also typically requires personal guarantees from the principal owners of the property, supported by a review of their personal financial statements, as an additional means of mitigating risk. The Company manages risk by avoiding concentrations in any one business or industry. Commercial real estate loans are primarily secured by retail shopping facilities, office and industrial buildings, healthcare facilities, warehouses, and various special purpose commercial properties.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Com mercial and Industrial - Commercial and industrial loans receive similar underwriting treatment as commercial real estate loans in that the repayment source is analyzed to determine its ability to meet cash flow coverage requirements as set forth by Company policies. Repayment of these loans generally comes from the generation of cash flow as the result of the borrower’s business operations. Commercial lending generally involves different risks from those associated with commercial real estate lending or construction lending. Although commercial loans may be collateralized by equipment or other business assets (including real estate, if available as collateral), the repayment of these types of loans depends primarily on the creditworthiness and projected cash flow of the borrower (and any guarantors). Thus, the general business conditions of the local economy and the borrower’s ability to sell its products and services, thereby generating sufficient operating revenue to repay us under the agreed upon terms and conditions, are the chief considerations when assessing the risk of a commercial loan. The liquidation of collateral, if any, is considered a secondary source of repayment because equipment and other business assets may, among other things, be obsolete or of limited resale value. The Company actively monitors certain financial measures of the borrower, including advance rate, cash flow, collateral value and other appropriate credit factors. Commercial and industrial loans also include public finance loans made to governmental entities, which can be taxable or tax-exempt, and are generally repaid using pledged revenue sources including income tax, property tax, sales tax, and utility revenue, among other sources. Commercial and industrial loans are primarily secured by accounts receivable, inventory and equipment.

Consumer - Consumer loans are offered by the Company in order to provide a full range of retail financial services to its customers and include auto loans, credit cards, and other consumer installment loans. Typically, the Company evaluates the borrower’s repayment ability through a review of credit scores and an evaluation of debt to income ratios. Repayment of consumer loans depends upon key consumer economic measures and upon the borrower’s financial stability and is more likely to be adversely affected by divorce, job loss, illness and personal hardships than repayment of other loans. A shortfall in the value of any collateral also may pose a risk of loss to the Company for these types of loans. Consumer loans include loans primarily secured by vehicles and unsecured loans.

Credit Quality Indicators

Loans are categorized into risk categories based on relevant information about the ability of borrowers to service their debt, such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The following definitions are utilized for risk ratings, which are consistent with the definitions used in supervisory guidance:

Pass - Loans not meeting the criteria below are considered pass. These loans have higher credit characteristics and financial strength. The borrowers at least generate profits and cash flow that are in line with peer and industry standards and have debt service coverage ratios above loan covenants and policy guidelines. For some of these loans, a guaranty from a financially capable party mitigates characteristics of the borrower that might otherwise result in a lower grade.

Special Mention - Loans classified as special mention possess some credit deficiencies that need to be corrected to avoid a greater risk of default in the future. For example, financial ratios relating to the borrower may have deteriorated. Often, a special mention categorization is temporary while certain factors are analyzed or matters addressed before the loan is re-categorized as either pass or substandard.

Substandard - Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the borrower or the liquidation value of any collateral. If deficiencies are not addressed, it is likely that this category of loan will result in the Bank incurring a loss. Where a borrower has been unable to adjust to industry or general economic conditions, the borrower’s loan is often categorized as substandard.

Doubtful - Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loss - Loans classified as loss are considered uncollectible and of such little value that their continuance as recorded assets is not warranted. This classification does not mean that the assets have absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off these assets.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The tables below present the Company’s loan portfolio by year of origination, category, and credit quality indicator as of March 31, 2025 and December 31, 2024 (dollars in thousands). Loans acquired are shown in the table by origination year. The Company had an immaterial amount of revolving loans converted to term loans at March 31, 2025 and December 31, 2024 .

	*March 31, 2025*
	*2025*			*2024*			*2023*			*2022*			*2021*			*Prior*			*Revolving Loans*			*Total*
Construction and development
Pass	$	8,205		$	54,953		$	32,720		$	17,375		$	3,453		$	3,595		$	18,862		$	139,163
Special Mention		—			—			—			—			732			—			—			732
Substandard		—			—			4,515			4,842			—			23			—			9,380
Total construction and development	$	8,205		$	54,953		$	37,235		$	22,217		$	4,185		$	3,618		$	18,862		$	149,275

Current-period gross charge-offs	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—

1-4 Family
Pass	$	2,693		$	11,130		$	38,138		$	95,297		$	71,617		$	118,957		$	52,661		$	390,493
Special Mention		—			61			—			—			—			1			—			62
Substandard		—			164			198			638			703			2,164			313			4,180
Total 1-4 family	$	2,693		$	11,355		$	38,336		$	95,935		$	72,320		$	121,122		$	52,974		$	394,735

Current-period gross charge-offs	$	—		$	—		$	—		$	—		$	—		$	( 23	)	$	—		$	( 23	)

Multifamily
Pass	$	3,845		$	1,627		$	22,999		$	46,818		$	11,852		$	10,015		$	199		$	97,355
Special Mention		—			—			—			—			—			3,908			—			3,908
Substandard		—			—			—			643			—			1,342			—			1,985
Total multifamily	$	3,845		$	1,627		$	22,999		$	47,461		$	11,852		$	15,265		$	199		$	103,248

Current-period gross charge-offs	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—

Farmland
Pass	$	45		$	71		$	1,569		$	1,276		$	381		$	2,284		$	1,092		$	6,718
Special Mention		—			—			—			—			—			—			—			—
Substandard		—			—			—			—			—			—			—			—
Total farmland	$	45		$	71		$	1,569		$	1,276		$	381		$	2,284		$	1,092		$	6,718

Current-period gross charge-offs	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—

Commercial real estate
Pass	$	22,883		$	48,208		$	75,114		$	286,559		$	198,326		$	276,039		$	6,029		$	913,158
Special Mention		—			—			247			—			1,633			4,156			—			6,036
Substandard		—			2,601			122			1,301			4,069			4,464			117			12,674
Total commercial real estate	$	22,883		$	50,809		$	75,483		$	287,860		$	204,028		$	284,659		$	6,146		$	931,868

Current-period gross charge-offs	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—

Commercial and industrial
Pass	$	24,467		$	36,690		$	29,743		$	117,106		$	21,208		$	21,427		$	258,757		$	509,398
Special Mention		—			—			—			—			—			—			734			734
Substandard		—			494			—			—			—			139			—			633
Total commercial and industrial	$	24,467		$	37,184		$	29,743		$	117,106		$	21,208		$	21,566		$	259,491		$	510,765

Current-period gross charge-offs	$	—		$	( 6	)	$	—		$	( 6	)	$	( 23	)	$	—		$	( 43	)	$	( 78	)

Consumer
Pass	$	1,680		$	3,219		$	1,742		$	1,116		$	587		$	878		$	557		$	9,779
Special Mention		—			—			—			—			—			—			—			—
Substandard		—			—			146			7			—			90			—			243
Total consumer	$	1,680		$	3,219		$	1,888		$	1,123		$	587		$	968		$	557		$	10,022

Current-period gross charge-offs	$	( 12	)	$	—		$	( 6	)	$	( 6	)	$	( 1	)	$	( 1	)	$	—		$	( 26	)

Total loans
Pass	$	63,818		$	155,898		$	202,025		$	565,547		$	307,424		$	433,195		$	338,157		$	2,066,064
Special Mention		—			61			247			—			2,365			8,065			734			11,472
Substandard		—			3,259			4,981			7,431			4,772			8,222			430			29,095
Total loans	$	63,818		$	159,218		$	207,253		$	572,978		$	314,561		$	449,482		$	339,321		$	2,106,631

Current-period gross charge-offs	$	( 12	)	$	( 6	)	$	( 6	)	$	( 12	)	$	( 24	)	$	( 24	)	$	( 43	)	$	( 127	)

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

	*December 31, 2024*
	*2024*			*2023*			*2022*			*2021*			*2020*		*Prior*			*Revolving Loans*			*Total*
Construction and development
Pass	$	53,448		$	36,560		$	26,585		$	3,583		$	2,176	$	1,754		$	19,946		$	144,052
Special Mention		—			374			—			737			—		—			—			1,111
Substandard		—			4,524			4,842			—			18		6			—			9,390
Total construction and development	$	53,448		$	41,458		$	31,427		$	4,320		$	2,194	$	1,760		$	19,946		$	154,553

Current-period gross charge-offs	$	—		$	—		$	( 77	)	$	( 72	)	$	—	$	—		$	—		$	( 149	)

1-4 Family
Pass	$	12,039		$	38,426		$	92,502		$	72,848		$	53,300	$	70,854		$	51,424		$	391,393
Special Mention		61			—			—			—			—		2			—			63
Substandard		170			352			902			931			752		2,079			173			5,359
Total 1-4 family	$	12,270		$	38,778		$	93,404		$	73,779		$	54,052	$	72,935		$	51,597		$	396,815

Current-period gross charge-offs	$	( 86	)	$	—		$	( 42	)	$	—		$	—	$	( 120	)	$	—		$	( 248	)

Multifamily
Pass	$	1,639		$	7,538		$	47,070		$	11,994		$	3,400	$	6,796		$	199		$	78,636
Special Mention		—			—			—			—			—		3,940			—			3,940
Substandard		—			—			649			—			1,351		—			—			2,000
Total multifamily	$	1,639		$	7,538		$	47,719		$	11,994		$	4,751	$	10,736		$	199		$	84,576

Current-period gross charge-offs	$	—		$	—		$	—		$	—		$	—	$	—		$	—		$	—

Farmland
Pass	$	72		$	1,605		$	1,290		$	633		$	892	$	1,508		$	977		$	6,977
Special Mention		—			—			—			—			—		—			—			—
Substandard		—			—			—			—			—		—			—			—
Total farmland	$	72		$	1,605		$	1,290		$	633		$	892	$	1,508		$	977		$	6,977

Current-period gross charge-offs	$	—		$	—		$	—		$	—		$	—	$	—		$	—		$	—

Commercial real estate
Pass	$	51,071		$	77,895		$	293,519		$	202,461		$	159,968	$	134,164		$	7,993		$	927,071
Special Mention		—			251			—			1,662			162		157			—			2,232
Substandard		3,178			648			1,321			3,986			2,901		3,094			117			15,245
Total commercial real estate	$	54,249		$	78,794		$	294,840		$	208,109		$	163,031	$	137,415		$	8,110		$	944,548

Current-period gross charge-offs	$	—		$	—		$	—		$	—		$	—	$	—		$	—		$	—

Commercial and industrial
Pass	$	45,894		$	38,599		$	120,877		$	24,351		$	7,612	$	15,842		$	272,853		$	526,028
Special Mention		—			—			—			—			—		—			418			418
Substandard		23			—			6			24			—		235			194			482
Total commercial and industrial	$	45,917		$	38,599		$	120,883		$	24,375		$	7,612	$	16,077		$	273,465		$	526,928

Current-period gross charge-offs	$	—		$	—		$	( 18	)	$	—		$	—	$	—		$	( 812	)	$	( 830	)

Consumer
Pass	$	4,043		$	2,602		$	1,307		$	824		$	200	$	821		$	645		$	10,442
Special Mention		—			—			—			—			—		—			—			—
Substandard		—			144			6			—			12		83			—			245
Total consumer	$	4,043		$	2,746		$	1,313		$	824		$	212	$	904		$	645		$	10,687

Current-period gross charge-offs	$	( 87	)	$	( 6	)	$	( 7	)	$	( 2	)	$	—	$	( 25	)	$	( 8	)	$	( 135	)

Total loans
Pass	$	168,206		$	203,225		$	583,150		$	316,694		$	227,548	$	231,739		$	354,037		$	2,084,599
Special Mention		61			625			—			2,399			162		4,099			418			7,764
Substandard		3,371			5,668			7,726			4,941			5,034		5,497			484			32,721
Total loans	$	171,638		$	209,518		$	590,876		$	324,034		$	232,744	$	241,335		$	354,939		$	2,125,084

Current-period gross charge-offs	$	( 173	)	$	( 6	)	$	( 144	)	$	( 74	)	$	—	$	( 145	)	$	( 820	)	$	( 1,362	)

The Company had no loans that were classified as doubtful or loss at March 31, 2025 or December 31, 2024 .

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Loan Participations and Sold Loans

Loan participations and whole loans sold to and servic ed for others are not included in the accompanying consolidated balance sheets, the balances of which we re $ 39.0 million and $ 38.2 million a t March 31, 2025 and December 31, 2024 , respectively. The unpaid principal balances of these loans were approximatel y $ 191.2 million and $ 175.0 million at March 31, 2025 and December 31, 2024 , respectively.

Loans to Related Parties

In the ordinary course of business, the Company makes loans to related parties including its executive officers, principal stockholders, directors and their immediate family members, as well as to companies of which these individuals are principal owners. Loans outstanding to such related party borrowers amounted to approximately $ 42.9 million and $ 43.6 million as of March 31, 2025 and December 31, 2024 , respectively. No related party loans were classified as nonperforming or nonaccrual at March 31, 2025 or December 31, 2024 .

The table below shows the aggregate principal balance of loans to such related parties as of the dates presented (dollars in thousands).

	*March 31, 2025*			*December 31, 2024*
Balance, beginning of period	$	43,647		$	46,000
New loans/changes in relationship		123			620
Repayments/changes in relationship		( 874	)		( 2,973	)
Balance, end of period	$	42,896		$	43,647

Allowance for Credit Losses

The Company accounts for the ACL in accordance with FASB ASC Topic 326 “Financial Instruments – Credit Losses ” (“ASC 326” ) , which uses the CECL accounting methodology. The CECL methodology requires that lifetime expected credit losses be recorded at the time the financial asset is originated or acquired, and be adjusted each period as a provision for credit losses for changes in expected lifetime credit losses. The Company developed a CECL model methodology that calculates expected credit losses over the life of the portfolio by analyzing the composition, characteristics and quality of the loan portfolio, as well as prevailing economic conditions and forecasts. The CECL calculation estimates credit losses using a combination of discounted cash flow and remaining life analyses. To the extent the lives of the loans in the portfolio extend beyond the period for which a reasonable and supportable forecast can be made, when necessary, the model reverts back to the historical loss rates adjusted for qualitative factors related to current conditions using a four -quarter reversion period. The Company evaluates the adequacy of the ACL on a quarterly basis.

The ACL is comprised of reserves measured on a collective (pool) basis based on a lifetime loss-rate model when similar risk characteristics exist. For each pool of loans, the Company evaluates and applies qualitative adjustments to the calculated ACL based on several factors, including, but not limited to, changes in current and expected future economic conditions, changes in the nature and volume of the portfolio, changes in levels of concentrations, changes in the volume and severity of past due loans, changes in lending policies and personnel and changes in the competitive and regulatory environment of the banking industry. Loans that do not share similar risk characteristics with other loans are excluded from the loan pools and individually evaluated for impairment. For collateral dependent loans where the borrower is experiencing financial difficulty, which the Company evaluates independently from the loan pool, the expected credit loss is measured as the difference between the amortized cost basis of the loan and the fair value of the collateral, which is based on third party appraisals. Individually evaluated loans that are not collateral dependent are evaluated based on a discounted cash flow methodology. Credits deemed uncollectible are charged to the ACL. Provisions for credit losses and recoveries on loans previously charged off are adjustments to the ACL.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The Company made the accounting policy election to exclude accrued interest receivable from the amortized cost of loans and the estimate of the ACL. Accrued interest receivable on the Company’s loan s was $ 12.7 million and $ 12.5 million a t March 31, 2025 and December 31, 2024 , respectively, and is included in “ Accrued interest receivable ” on the accompanying consolidated balance sheets.

The table below shows a summary of the activity in the ACL for the three months ended March 31, 2025 and 2024 (dollars in thousands).

	*Three months ended March 31,*
	*2025*			*2024*
Balance, beginning of period	$	26,721		$	30,540
Provision for credit losses on loans ⁽¹⁾		( 3,695	)		( 1,411	)
Charge-offs		( 127	)		( 103	)
Recoveries		3,536			88
Balance, end of period	$	26,435		$	29,114

^{(

1

)}

For the three months ended March 31, 2025 , the $ 3.6 million negative provision for credit losses on the consolidated statement of income includes a $ 3.7 million negative provision for loan losses and a $ 0.1 million provision for unfunded loan commitments. For the three months ended March 31, 2024 , the $ 1.4 negative provision for credit losses on the consolidated statement of income includes a $ 1.4 million negative provision for loan losses and a $ 9,000 negative provision for unfunded loan commitments.

The negative provision for credit losses for the three months ended March 31, 2025 was primarily due to net recoveries on one loan relationship that became impaired in the third quarter of 2021 as a result of Hurricane Ida . The negative provision for credit losses for the three months ended March 31, 2024 was primarily due to a decrease in total loans, aging of existing loans, and, to a lesser extent, the completion of the annual CECL allowance model recalibration, which resulted in lower historical loss rates.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following tables outline the activity in the ACL by collateral type for the three months ended March 31, 2025 and 2024 , and show both the allowance and portfolio balances for loans individually and collectively evaluated for impairment as of March 31, 2025 and 2024 (dollars in thousands).

	*Three months ended March 31, 2025*
	*Construction & Development*		*1-4 Family*			*Multifamily*		*Farmland*		*Commercial Real Estate*			*Commercial & Industrial*			*Consumer*			*Total*
Allowance for credit losses:
Beginning balance	$	1,145	$	5,603		$	1,185	$	8	$	11,759		$	6,933		$	88		$	26,721
Provision for credit losses on loans		112		964			312		—		( 3,055	)		( 2,062	)		34			( 3,695	)
Charge-offs		—		( 23	)		—		—		—			( 78	)		( 26	)		( 127	)
Recoveries		1		8			—		—		3,314			209			4			3,536
Ending balance	$	1,258	$	6,552		$	1,497	$	8	$	12,018		$	5,002		$	100		$	26,435
Ending allowance balance for loans individually evaluated for impairment		—		257			—		—		232			—			7			496
Ending allowance balance for loans collectively evaluated for impairment		1,258		6,295			1,497		8		11,786			5,002			93			25,939
Loans receivable:
Balance of loans individually evaluated for impairment		23		2,962			—		—		2,247			139			214			5,585
Balance of loans collectively evaluated for impairment		149,252		391,773			103,248		6,718		929,621			510,626			9,808			2,101,046
Total period-end balance	$	149,275	$	394,735		$	103,248	$	6,718	$	931,868		$	510,765		$	10,022		$	2,106,631

	*Three months ended March 31, 2024*
	*Construction & Development*			*1-4 Family*			*Multifamily*		*Farmland*			*Commercial Real Estate*		*Commercial & Industrial*			*Consumer*			*Total*
Allowance for credit losses:
Beginning balance	$	2,471		$	9,129		$	1,124	$	2		$	10,691	$	6,920		$	203		$	30,540
Provision for credit losses on loans		( 906	)		( 3,206	)		411		( 29	)		1,580		791			( 52	)		( 1,411	)
Charge-offs		—			—			—		—			—		( 66	)		( 37	)		( 103	)
Recoveries		9			5			—		36			—		31			7			88
Ending balance	$	1,574		$	5,928		$	1,535	$	9		$	12,271	$	7,676		$	121		$	29,114
Ending allowance balance for loans individually evaluated for impairment		112			183			—		—			—		194			20			509
Ending allowance balance for loans collectively evaluated for impairment		1,462			5,745			1,535		9			12,271		7,482			101			28,605
Loans receivable:
Balance of loans individually evaluated for impairment		586			4,095			—		—			388		467			113			5,649
Balance of loans collectively evaluated for impairment		172,925			410,385			105,124		7,539			948,870		518,502			11,584			2,174,929
Total period-end balance	$	173,511		$	414,480		$	105,124	$	7,539		$	949,258	$	518,969		$	11,697		$	2,180,578

Loan Modifications to Borrowers Exper iencing Financial Difficulty

Occasionally, the Company modifies loans to borrowers in financial distress by providing certain concessions, such as principal forgiveness, an interest rate reduction, an other-than-insignificant payment delay, a term extension, or a combination of such concessions. Modifications that do not impact the contractual payments terms, such as covenant waivers, modification of a contingent acceleration clauses, and insignificant payment delays are not included in the disclosures. When principal forgiveness is provided, the amount of forgiveness is charged-off against the ACL. Upon the Company’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or portion of the loan) is written off. During the three months ended March 31, 2025 and 2024 , the Company did not provide any modifications under these circumstances to borrowers experiencing financial difficulty.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 5. STOCKHOLDERS ’ EQUITY

Accumulated Other Comprehensive (Loss) Income

Activity within the balances in accumulated other comprehensive (loss) income, net is shown in the table below (dollars in thousands).

	*Three months ended March 31,*
	*2025*								*2024*
	*Beginning of Period*			*Net Change*		*End of Period*			*Beginning of Period*			*Net Change*			*End of Period*
Unrealized (loss) gain, AFS, net	$	( 43,432	)	$	5,478	$	( 37,954	)	$	( 39,627	)	$	( 3,810	)	$	( 43,437	)
Reclassification of realized gain, AFS, net		( 4,926	)		—		( 4,926	)		( 5,521	)		—			( 5,521	)
Unrealized gain, transfer from AFS to HTM, net		1			—		1			1			—			1
Accumulated other comprehensive (loss) income	$	( 48,357	)	$	5,478	$	( 42,879	)	$	( 45,147	)	$	( 3,810	)	$	( 48,957	)

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 6. DERIVATIVE FINANCIAL INSTRUMENTS

As part of its liability management, the Company has historically utilized pay-fixed interest rate swaps to manage exposure against the variability in the expected future cash flows (future interest payments) attributable to changes in the 1 -month SOFR associated with the forecasted issuances of 1 -month fixed rate debt arising from a rollover strategy. To mitigate credit risk, securities were pledged to the Company by the counterparties in an amount greater than or equal to the gain position of the derivative contracts. Conversely, securities were pledged to the counterparties by the Company in an amount greater than or equal to the loss position of the derivative contracts, if applicable. There were no assets or liabilities recorded in the accompanying consolidated balance sheets at March 31, 2025 or December 31, 2024 associated with the swap contracts, other than interest rate swaps related to customer loans, described below.

Customer Derivatives – Interest Rate Swaps

The Company enters into interest rate swaps that allow commercial loan customers to effectively convert a variable-rate commercial loan agreement to a fixed-rate commercial loan agreement. Under these agreements, the Company enters into a variable-rate loan agreement with a customer in addition to an interest rate swap agreement, which serves to effectively swap the customer’s variable-rate loan into a fixed-rate loan. The Company then enters into a corresponding swap agreement with a third party in order to economically hedge its exposure through the customer agreement. The interest rate swaps with both the customers and third parties are not designated as hedges under FASB ASC Topic 815, “Derivatives and Hedging” (“ASC 815” ) , and are marked to market through earnings. As the interest rate swaps are structured to offset each other, changes to the underlying benchmark interest rates considered in the valuation of these instruments do not result in an impact to earnings; however, there may be fair value adjustments related to credit quality variations between counterparties, which may impact earnings as required by FASB ASC Topic 820, “Fair Value Measurement” (“ASC 820” ). The Company did not recognize any net gains or losses in other operating income resulting from fair value adjustments of these swap agreements during the three months ended March 31, 2025 and 2024 .

The table below presents the notional amounts and fair values of the Company’s derivative financial instruments as well as their classification on the accompanying consolidated balance sheets at March 31, 2025 and December 31, 2024 (dollars in thousands).

			*Fair Value*
	Notional ⁽¹⁾		Derivative Assets ⁽²⁾		Derivative Liabilities ⁽²⁾
March 31, 2025
Interest rate swaps	$	366,650	$	15,073	$	15,073

December 31, 2024
Interest rate swaps	$	373,845	$	17,195	$	17,195

^{(

1

)}

At March 31, 2025 the Company had notional amounts of $ 183.3 million in interest rate swap contracts with customers and $ 183.3 million in offsetting interest rate swap contracts with other financial institutions. At December 31, 2024 the Company had notional amounts of $ 186.9 million in interest rate swap contracts with customers and $ 186.9 million in offsetting interest rate swap contracts with other financial institutions.

^{(

2

)}

Derivative assets and liabilities are reported at fair value in “Other assets” and “Accrued taxes and other liabilities” , respectively, in the accompanying consolidated balance sheets.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 7. FAIR VALUES OF FINANCIAL INSTRUMENTS

In accordance with ASC 820, disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet, is required. The fair value of a financial instrument is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. Fair value is best determined based upon quoted market prices or exit prices. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows, and the fair value estimates may not be realized in an immediate settlement of the instruments. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company.

If there has been a significant decrease in the volume and level of activity for the asset or liability, a change in valuation technique or the use of multiple valuation techniques may be appropriate. In such instances, determining the price at which willing market participants would transact at the measurement date under current market conditions depends on the facts and circumstances and requires use of significant judgment. The fair value is a reasonable point within the range that is most representative of fair value under current market conditions.

The Company holds SBIC qualified funds and other investment funds that do not have a readily determinable fair value. In accordance with ASC 820, these investments are measured at fair value using the net asset value practical expedient and are not required to be classified in the fair value hierarchy. At March 31, 2025 and December 31, 2024 , the fair values of these investments were $ 3.9 million and $ 3.8 million, respectively, and are included in “Other assets” in the accompanying consolidated balance sheets.

Fair Value Hierarchy

In accordance with ASC 820, the Company groups its financial assets and financial liabilities measured at fair value in three levels, based on the markets in which the assets and liabilities are traded, and the reliability of the assumptions used to determine fair value.

Level 1 – Valuation is based upon quoted prices for identical assets or liabilities traded in active markets.

Level 2 – Valuation is based upon observable inputs other than quoted prices included in level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.

Level 3 – Valuation is based upon unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies, and similar techniques that use significant unobservable inputs.

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Fair Value of Assets and Liabilities Measured on a Recurring Basis

The following methods and assumptions were used by the Company in estimating the fair value of assets and liabilities valued on a recurring basis:

AFS Investment Securities and Marketable Equity Securities – Where quoted prices are available in an active market, the Company classifies the securities within level 1 of the valuation hierarchy. Securities are defined as both long and short positions. Level 1 securities include marketable equity securities in corporate stocks and mutual funds.

If quoted market prices are not available, the Company estimates fair values using pricing models and discounted cash flows that consider standard input factors such as observable market data, benchmark yields, interest rate volatilities, broker/dealer quotes, and credit spreads. Examples of such instruments, which would generally be classified within level 2 of the valuation hierarchy if observable inputs are available, include obligations of the U.S. Treasury and U.S. government agencies and corporations, obligations of state and political subdivisions, corporate bonds, residential mortgage-backed securities, and commercial mortgage-backed securities. In certain cases where there is limited activity or less transparency around inputs to the valuation, the Company classifies those securities in level 3.

Management monitors the current placement of securities in the fair value hierarchy to determine whether transfers between levels may be warranted based on market reference data, which may include reported trades; bids, offers or broker/dealer quotes; benchmark yields and spreads; as well as other reference data. At March 31, 2025 and December 31, 2024 , the majority of the Company’s level 3 investments were obligations of state and political subdivisions. The Company estimated the fair value of these level 3 investments using discounted cash flow models, the key inputs of which are the coupon rate, current spreads to the yield curves, and expected repayment dates, adjusted for illiquidity of the local municipal market and sinking funds, if applicable. Option-adjusted models may be used for structured or callable notes, as appropriate.

Derivative Financial Instruments – The fair value for interest rate swap agreements is based upon the amounts required to settle the contracts. These derivative instruments are classified in level 2 of the fair value hierarchy.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Assets and liabilities measured at fair value on a recurring basis are summarized in the table below as of the dates indicated (dollars in thousands).

	*Estimated*		*Quoted Prices in Active Markets for Identical Assets*		*Significant Other Observable Inputs*		*Significant Unobservable Inputs*
	*Fair Value*		*(Level 1)*		*(Level 2)*		*(Level 3)*
March 31, 2025
Assets:
Obligations of the U.S. Treasury and U.S. government agencies and corporations	$	15,373	$	—	$	15,373	$	—
Obligations of state and political subdivisions		15,407		—		11,931		3,476
Corporate bonds		28,534		—		28,039		495
Residential mortgage-backed securities		222,098		—		222,098		—
Commercial mortgage-backed securities		64,316		—		64,316		—
Equity securities at fair value		2,517		2,517		—		—
Interest rate swaps - gross assets		15,073		—		15,073		—
Total assets	$	363,318	$	2,517	$	356,830	$	3,971
Liabilities:
Interest rate swaps - gross liabilities	$	15,073	$	—	$	15,073	$	—

December 31, 2024
Assets:
Obligations of the U.S. Treasury and U.S. government agencies and corporations	$	15,707	$	—	$	15,707	$	—
Obligations of state and political subdivisions		16,120		—		11,803		4,317
Corporate bonds		27,267		—		26,773		494
Residential mortgage-backed securities		208,768		—		208,768		—
Commercial mortgage-backed securities		63,259		—		63,259		—
Equity securities at fair value		2,593		2,593		—		—
Interest rate swaps - gross assets		17,195		—		17,195		—
Total assets	$	350,909	$	2,593	$	343,505	$	4,811
Liabilities:
Interest rate swaps - gross liabilities	$	17,195	$	—	$	17,195	$	—

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The Company reviews fair value hierarchy classifications on a quarterly basis. Changes in the Company’s ability to observe inputs to the valuation may cause reclassification of certain assets or liabilities within the fair value hierarchy. The tables below provide a reconciliation for assets measured at fair value on a recurring basis using significant unobservable inputs, or level 3 inputs, for the three months ended March 31, 2025 and 2024 (dollars in thousands).

	*Obligations of State and Political Subdivisions*			*Corporate Bonds*
Balance at December 31, 2024	$	4,317		$	494
Realized gain (loss) included in earnings		—			—
Unrealized gain included in other comprehensive income		76			1
Purchases		—			—
Sales		—			—
Maturities, prepayments, and calls		( 917	)		—
Transfers into level 3		—			—
Transfers out of level 3		—			—
Balance at March 31, 2025	$	3,476		$	495

	*Obligations of State and Political Subdivisions*			*Corporate Bonds*
Balance at December 31, 2023	$	5,250		$	463
Realized gain (loss) included in earnings		—			—
Unrealized (loss) gain included in other comprehensive loss		( 749	)		6
Purchases		—			—
Sales		—			—
Maturities, prepayments, and calls		( 27	)		—
Transfers into level 3		—			—
Transfers out of level 3		—			—
Balance at March 31, 2024	$	4,474		$	469

There were no liabilities measured at fair value on a recurring basis using level 3 inputs at March 31, 2025 and December 31, 2024 . For the three months ended March 31, 2025 and 2024 , there were no gains or losses included in earnings related to the change in fair value of the assets measured on a recurring basis using significant unobservable inputs held at the end of the period.

The following table provides quantitative information about significant unobservable inputs used in fair value measurements of level 3 assets measured at fair value on a recurring basis at March 31, 2025 and December 31, 2024 (dollars in thousands).

	*Estimated Fair Value*		*Valuation Technique*	*Unobservable Inputs*	*Range of Discounts*
March 31, 2025
Obligations of state and political subdivisions	$	3,476	Option-adjusted discounted cash flow model; present value of expected future cash flow model	Bond appraisal adjustment ⁽¹⁾	1 % - 12 %
Corporate bonds		495	Option-adjusted discounted cash flow model; present value of expected future cash flow model	Bond appraisal adjustment ⁽¹⁾	1 %

December 31, 2024
Obligations of state and political subdivisions	$	4,317	Option-adjusted discounted cash flow model; present value of expected future cash flow model	Bond appraisal adjustment ⁽¹⁾	2 % - 15 %
Corporate bonds		494	Option-adjusted discounted cash flow model; present value of expected future cash flow model	Bond appraisal adjustment ⁽¹⁾	1 %

^{(

1

)} Fair values determined through valuation analysis using coupon, yield (discount margin), liquidity and expected repayment dates.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Fair Value of Assets and Liabilities Measured on a Nonrecurring Basis

Certain financial assets and financial liabilities are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment).

The following methods and assumptions were used by the Company in estimating the fair value of assets and liabilities valued on a nonrecurring basis:

Loans Individually Evaluated – For collateral dependent loans where the borrower is experiencing financial difficulty the expected credit loss is measured as the difference between the amortized cost basis of the loan and the fair value of the collateral, which is based on third party appraisals. Individually evaluated loans that are not collateral dependent are evaluated based on a discounted cash flow methodology. Credits deemed uncollectible are charged to the ACL . Since not all valuation inputs are observable, these nonrecurring fair value determinations are classified as level 3.

Other Real Estate Owned – Other real estate owned consists of properties acquired through foreclosure or acceptance of a deed in lieu of foreclosure and real property no longer used in the Bank’s business operations. Real estate acquired through foreclosure is initially recorded at fair value at the time of foreclosure, less estimated selling cost, and any related write-down is charged to the ACL. Real property no longer used in the Bank’s business operations is recorded at the lower of its net book value or fair value at the date of transfer to other real estate owned. Subsequently, it may be necessary to record nonrecurring fair value adjustments for declines in fair value. Fair value, when recorded, is determined based on appraisals by qualified licensed appraisers and adjusted for management’s estimates of costs to sell. Accordingly, values for other real estate owned are classified as level 3.

Quantitative information about assets measured at fair value on a nonrecurring basis based on significant unobservable inputs (level 3 ) is summarized below as of March 31, 2025 and December 31, 2024 . There were no liabilities measured on a nonrecurring basis at March 31, 2025 or December 31, 2024 (dollars in thousands).

	*Estimated Fair Value*		*Valuation Technique*	*Unobservable Inputs*	*Range of Discounts*	Weighted Average Discount ⁽³⁾
March 31, 2025
Loans individually evaluated for impairment ⁽¹⁾	$	1,735	Discounted cash flows; underlying collateral value	Collateral discounts and estimated costs to sell	6 % - 100 %	13 %

December 31, 2024
Loans individually evaluated for impairment ⁽¹⁾	$	2,174	Discounted cash flows; underlying collateral value	Collateral discounts and estimated costs to sell	0 % - 79 %	31 %
Other real estate owned ⁽²⁾		900	Underlying collateral value, third party appraisals	Collateral discounts and discount rates	18 %	18 %

^{(

1

)} Loan s individually evaluated for impairment that were re-measured during the period had a carrying value of $ 2.0 million and $ 2.4 million at March 31, 2025 and December 31, 2024 , respectively, with related ACL of $ 0.3 million and $ 0.2 million, respectively, as o f s uch dates.

^{(

2

)} Other real estate owned that was re-measured during the period had a carrying value of $ 0.9 million at December 31, 2024 . During the three months ended March 31, 2024 , the Company recorded a $ 0.2 million write-down of other real estate owned which is included as part of “Other operating expenses” in noninterest expense on the accompanying consolidated statement of income .

^{(

3

)} Weighted by relative fair value.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Financial Instruments

Accounting guidance requires the disclosure of estimated fair value information about certain on- and off-balance sheet financial instruments, including those financial instruments that are not measured and reported at fair value on a recurring or nonrecurring basis. The significant methods and assumptions used by the Company to estimate the fair value of financial instruments are discussed below.

Cash and Cash Equivalents – For these short-term instruments, the fair value is the carrying value. The Company classifies these assets in level 1 of the fair value hierarchy.

Investment Securities and Equity Securities – The fair value measurement techniques and assumptions for AFS securities and marketable equity securities is discussed earlier in the note. The same measurement techniques and assumptions were applied to the valuation of HTM securities and nonmarketable equity securities including equity in correspondent banks.

Loans – The fair value of portfolio loans, net is determined using an exit price methodology. The exit price methodology is based on a discounted cash flow analysis, in which projected cash flows are based on contractual cash flows adjusted for prepayments for certain loan types (e.g., residential mortgage loans and multifamily loans) and the use of a discount rate based on expected relative risk of the cash flows. The discount rate selected considers loan type, maturity date, a liquidity premium, cost to service, and cost of capital, which is a level 3 fair value estimate.

Loans held for sale are measured using quoted market prices when available. If quoted market prices are not available, comparable market values or discounted cash flow analyses may be utilized. The Company classifies these assets in level 3 of the fair value hierarchy.

Deposits – The fair values disclosed for noninterest-bearing demand deposits are, by definition, equal to the amount payable on demand at the reporting date (that is, their carrying amounts). These noninterest-bearing deposits are classified in level 2 of the fair value hierarchy. All interest-bearing deposits are classified in level 3 of the fair value hierarchy. The carrying amounts of variable-rate accounts (for example, interest-bearing checking, savings, and money market accounts), fixed-term money market accounts, and certificates of deposit approximate their fair values at the reporting date. Fair values for fixed-rate certificates of deposit are estimated using a discounted cash flow analysis that applies market interest rates on comparable instruments to a schedule of aggregated expected monthly maturities on time deposits.

Short-Term Borrowings – The carrying amounts of federal funds purchased, repurchase agreements, and other short-term borrowings approximate their fair values. The Company classifies these borrowings in level 2 of the fair value hierarchy.

Long-Term Borrowings, including Junior Subordinated Debt Securities – The fair values of long-term borrowings are estimated using discounted cash flow analyses based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements. The fair value of the Company’s long-term debt is therefore classified in level 3 in the fair value hierarchy.

Subordinated Debt Securities – The fair value of subordinated debt is estimated based on current market rates on similar debt in the market. The Company classifies this debt in level 2 of the fair value hierarchy.

Derivative Financial Instruments – The fair value measurement techniques and assumptions for derivative financial instruments is discussed earlier in the note.

The estimated fair values of the Company’s financial instruments are summarized in the tables below as of the dates indicated (dollars in thousands).

	*March 31, 2025*
	*Carrying Amount*		*Estimated Fair Value*		*Level 1*		*Level 2*		*Level 3*
Financial assets:
Cash and cash equivalents	$	43,522	$	43,522	$	43,522	$	—	$	—
Investment securities - AFS		345,728		345,728		—		341,757		3,971
Investment securities - HTM		42,268		42,720		—		1,841		40,879
Equity securities at fair value		2,517		2,517		2,517		—		—
Nonmarketable equity securities		14,297		14,297		—		14,297		—
Loans, net of allowance		2,080,196		1,977,244		—		—		1,977,244
Interest rate swaps - gross assets		15,073		15,073		—		15,073		—

Financial liabilities:
Deposits, noninterest-bearing	$	436,735	$	436,735	$	—	$	436,735	$	—
Deposits, interest-bearing		1,910,622		1,821,769		—		—		1,821,769
Repurchase agreements		11,302		11,302		—		11,302		—
FHLB long-term advances		60,000		59,885		—		—		59,885
Junior subordinated debt		8,758		8,758		—		—		8,758
Subordinated debt		16,707		14,947		—		14,947		—
Interest rate swaps - gross liabilities		15,073		15,073		—		15,073		—

	*December 31, 2024*
	*Carrying Amount*		*Estimated Fair Value*		*Level 1*		*Level 2*		*Level 3*
Financial assets:
Cash and cash equivalents	$	27,922	$	27,922	$	27,922	$	—	$	—
Investment securities - AFS		331,121		331,121		—		326,310		4,811
Investment securities - HTM		42,687		42,144		—		1,821		40,323
Equity securities at fair value		2,593		2,593		2,593		—		—
Nonmarketable equity securities		16,502		16,502		—		16,502		—
Loans, net of allowance		2,098,363		1,973,780		—		—		1,973,780
Interest rate swaps - gross assets		17,195		17,195		—		17,195		—

Financial liabilities:
Deposits, noninterest-bearing	$	432,143	$	432,143	$	—	$	432,143	$	—
Deposits, interest-bearing		1,913,801		1,826,868		—		—		1,826,868
FHLB short-term advances and repurchase agreements		15,591		15,577		—		15,577		—
FHLB long-term advances		60,000		59,620		—		—		59,620
Junior subordinated debt		8,733		8,733		—		—		8,733
Subordinated debt		16,697		14,738		—		14,738		—
Interest rate swaps - gross liabilities		17,195		17,195		—		17,195		—

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 8. INCOME TAXES

The income tax expense and the effective tax rate included in the consolidated statements of income are shown in the table below for the periods presented (dollars in thousands).

	*Three months ended March 31,*
	*2025*			*2024*
Income tax expense	$	1,421		$	1,380
Effective tax rate		18.4	%		22.7	%

For the three months ended March 31, 2025 , the effective tax rate differed from the statutory tax rate of 21% primarily due to tax-exempt interest income earned on certain loans and investment securities and income from BOLI. For the three months ended March 31, 2024 , the effective tax rate differed from the statutory tax rate of 21% primarily due to the surrender of approximately $ 8.4 million of BOLI contracts, which resulted in $ 0.3 million of income tax expense, partially offset by tax-exempt interest income earned on certain loans and investment securities and income from BOLI.

NOTE 9. COMMITMENTS AND CONTINGENCIES

Unfunded Commitments

The Company is a party to financial instruments with off-balance sheet risk entered into in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit consisting of loan commitments and standby letters of credit, which are not included in the accompanying financial statements. Such financial instruments are recorded in the financial statements when they become payable. The credit risk associated with these commitments is evaluated in a manner similar to the ACL on loans. The reserve for unfunded loan commitments was $ 0.1 million and $ 42,000 at March 31, 2025 and December 31, 2024 , respectively, and is included in “Accrued taxes and other liabilities” in the accompanying consolidated balance sheets.

Commitments to extend credit are agreements to lend money with fixed expiration dates or termination clauses. The Company applies the same credit standards used in the lending process when extending these commitments and periodically reassesses the customer’s creditworthiness through ongoing credit reviews. Since some commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Collateral is obtained based on the Company’s assessment of the transaction. Substantially all standby letters of credit issued have expiration dates within one year.

The table below shows the approximate amounts of the Company’s commitments to extend credit as of the dates presented (dollars in thousands).

	*March 31, 2025*		*December 31, 2024*
Loan commitments	$	377,821	$	377,301
Standby letters of credit		7,504		7,658

Additionally, at March 31, 2025 , the Company had unfunded commitments of $ 0.9 million for its investments in SBIC qualified funds and other investment funds.

Table of Contents

INVESTAR HOLDING CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 10. LEASES

The Company’s primary leasing activities relate to certain real estate leases entered into in support of the Company’s branch operations. The Company’s lease agreements under which its branch locations are operated have all been designated as operating leases. The Company does not lease equipment under operating leases, nor does it have leases designated as finance leases.

Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which the Company has elected to account for separately, as the non-lease component amounts are readily determinable.

Quantitative information regarding the Company’s operating leases is presented below as of and for the three months ended March 31, 2025 and 2024 (dollars in thousands).

	*March 31,*
	*2025*			*2024*
Total operating lease cost	$	115		$	105
Weighted-average remaining lease term (in years)		5.4			6.6
Weighted-average discount rate		3.4	%		3.2	%

At March 31, 2025 and December 31, 2024 , the Company’s operating lease ROU assets were $ 2.1 million and $ 2.0 million, respectively, and the Company’s related operating lease liabilities were $ 2.1 million. The Company’s operating leases have remaining terms ranging from approximately three to seven years, including extension options if the Company is reasonably certain they will be exercised.

Future minimum lease payments due under non-cancelable operating leases at March 31, 2025 are presented below (dollars in thousands).

Remainder of 2025	$	341
2026		459
2027		459
2028		405
2029		337
Thereafter		350
Total	$	2,351

At March 31, 2025 , the Company had not entered into any material leases that have not yet commenced.

The Bank owns its corporate headquarters building, the first floor of which is occupied by multiple tenants. The Bank, as lessor, also leases a portion of one of its branch locations and a former stand-alone ATM location. All tenant leases are operating leases. The Bank, as lessor, recognized lease income of $ 0.1 million for both the three month periods ended March 31, 2025 and 2024 .

Table of Contents

ITEM 2. MANAGEMENT ’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Cautionary Note Regarding Forward-Looking Statements

When included in this Quarterly Report on Form 10-Q, or in other documents that Investar Holding Corporation files with the SEC or in statements made by or on behalf of the Company, words like “may,” “should,” “could,” “predict,” “potential,” “believe,” “think,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “would,” “outlook” and similar expressions or the negative version of those words are intended to identify forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve a variety of risks and uncertainties that could cause actual results to differ materially from those described therein. The Company’s forward-looking statements are based on assumptions and estimates that management believes to be reasonable in light of the information available at the time such statements are made. However, many of the matters addressed by these statements are inherently uncertain and could be affected by many factors beyond management’s control. A number of important factors could cause actual results to differ materially from those indicated by the forward-looking statements. These factors include, but are not limited to, the following, any one or more of which could materially affect the outcome of future events:

•

the significant risks and uncertainties for our business, results of operations and financial condition, as well as our regulatory capital and liquidity ratios and other regulatory requirements caused by business and economic conditions generally and in the financial services industry in particular, whether nationally, regionally or in the markets in which we operate, including heightened uncertainties resulting from recent changing trade and tariff policies that could have an adverse impact on inflation and economic growth at least in the near term;

	•	changes in inflation, interest rates, yield curves and interest rate spread relationships that affect our loan and deposit pricing;

	•	our ability to successfully execute our near-term strategy to pivot from primarily a growth strategy to a strategy primarily focused on consistent, quality earnings through the optimization of our balance sheet, and our ability to successfully execute a long-term growth strategy;

	•	our ability to achieve organic loan and deposit growth, and the composition of that growth;

	•	a reduction in liquidity, including as a result of a reduction in the amount of deposits we hold or other sources of liquidity, which may be caused by, among other things, disruptions in the banking industry similar to those that occurred in early 2023 that caused bank depositors to move uninsured deposits to other banks or alternative investments outside the banking industry;

•

our ability to identify and enter into agreements to combine with attractive acquisition candidates, finance acquisitions, complete acquisitions after definitive agreements are entered into, and successfully integrate and grow acquired operations;

•

inaccuracy of the assumptions and estimates we make in establishing reserves for credit losses and other estimates;

•

changes in the quality or composition of our loan portfolio, including adverse developments in borrower industries or in the repayment ability of individual borrowers;

•

changes in the quality and composition of, and changes in unrealized losses in, our investment portfolio, including whether we may have to sell securities before their recovery of amortized cost basis and realize losses;

•

the extent of continuing client demand for the high level of personalized service that is a key element of our banking approach as well as our ability to execute our strategy generally;

•

our dependence on our management team, and our ability to attract and retain qualified personnel;

•

the concentration of our business within our geographic areas of operation in Louisiana, Texas and Alabama;

•

increasing costs of complying with new and potential future regulations;

•

new or increasing geopolitical tensions, including resulting from wars in Ukraine and Israel and surrounding areas;

•

the emergence or worsening of widespread public health challenges or pandemics;

•

concentration of credit exposure;

•

any deterioration in asset quality and higher loan charge-offs, and the time and effort necessary to resolve problem assets;

•

fluctuations in the price of oil and natural gas;

•

data processing system failures and errors;

Table of Contents

•

risks associated with our digital transformation process, including increased risks of cyberattacks and other security breaches and challenges associated with addressing the increased prevalence of artificial intelligence;

•

risks of losses resulting from increased fraud attacks against us and others in the financial services industry;

•

potential impairment of our goodwill and other intangible assets;

•

our potential growth, including our entrance or expansion into new markets, and the need for sufficient capital to support that growth;

•

the impact of litigation and other legal proceedings to which we become subject;

•

competitive pressures in the commercial finance, retail banking, mortgage lending and consumer finance industries, as well as the financial resources of, and products offered by, competitors;

•

the impact of changes in laws and regulations applicable to us, including banking, securities and tax laws and regulations and accounting standards, as well as changes in the interpretation of such laws and regulations by our regulators;

•

changes in the scope and costs of FDIC insurance and other coverages;

•

governmental monetary and fiscal policies; and

•

hurricanes, tropical storms, tropical depressions, floods, winter storms, droughts and other adverse weather events, all of which have affected the Company’s market areas from time to time; other natural disasters; oil spills and other man-made disasters; acts of terrorism; other international or domestic calamities; acts of God; and other matters beyond our control.

These factors should not be construed as exhaustive. Additional information on these and other risk factors can be found in Part I. Item 1A. “Risk Factors” and Part II. Item 7. “MD&A – Cautionary Note Regarding Forward-Looking Statements” in the Company’s Annual Report and in Part II. Item 1A. “Risk Factors” of this report.

Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on any forward-looking statement as a prediction of future events. We expressly disclaim any obligation or undertaking to update our forward-looking statements, and we do not intend to release publicly any updates or changes in our expectations concerning the forward-looking statements or any changes in events, conditions or circumstances upon which any forward-looking statement may be based, except as required by law.

Critical Accounting Estimates

The preparation of our consolidated financial statements in accordance with GAAP requires us to make estimates and judgments that affect our reported amounts of assets, liabilities, income and expenses and related disclosure of contingent assets and liabilities. Although independent third parties are often engaged to assist us in the estimation process, management evaluates the results, challenges assumptions used and considers other factors which could impact these estimates. Actual results may differ from these estimates under different assumptions or conditions.

There were no material changes or developments during the reporting period with respect to methodologies that the Company uses when applying what management believes are significant accounting policies and developing critical accounting estimates, which are those estimates made in accordance with GAAP that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results of operations. We believe that the judgments, estimates and assumptions that we use in the preparation of our consolidated financial statements are appropriate. For more detailed information about our accounting policies, please refer to Note 1. Summary of Significant Accounting Policies of our Annual Report.

Company Overview

This section presents management’s perspective on the consolidated financial condition and results of operations of the Company and its wholly-owned subsidiary, Investar Bank, National Association. The following discussion and analysis should be read in conjunction with our unaudited consolidated financial statements and related notes thereto included herein, and the audited consolidated financial statements for the year ended December 31, 2024 , including the notes thereto, and the related MD&A in the Annual Report. All cross-references to the “Notes” in this Form 10-Q refer to the Notes to Consolidated Financial Statements contained in Part I. Item 1. Financial Statements unless otherwise noted .

Through the Bank, we provide full banking services, excluding trust services, tailored primarily to meet the needs of individuals, professionals, and small to medium-sized businesses. Our primary areas of operation are south Louisiana, including Baton Rouge, New Orleans, Lafayette, Lake Charles, and their surrounding areas; southeast Texas, primarily Houston and its surrounding area; and Alabama, including York and Oxford and their surrounding areas. At March 31, 2025 , we operated 29 full service branches comprised of 20 full service branches in Louisiana, three full service branches in Texas, and six full service branches in Alabama. The Bank commenced operations in 2006, and we completed our initial public offering in July 2014. On July 1, 2019, the Bank changed from a Louisiana state bank charter to a national bank charter and its name changed to Investar Bank, National Association.

During 2023, we pivoted our near-term strategy from primarily a growth strategy to primarily a focus on consistent, quality earnings through the optimization of our balance sheet. Our strategy includes a focus on originating and renewing high quality, primarily variable-rate, loans and allowing higher risk credit relationships to run off. We have kept duration short on our liabilities to provide flexibility to secure lower cost funding that was accretive to our net interest margin. Our near-term strategy includes continuing to consider acquisitions on an opportunistic basis. Our long-term strategy includes organic growth through high quality loans and growth through acquisitions, including whole-bank acquisitions, strategic branch acquisitions and asset acquisitions. We have completed seven whole-bank acquisitions since 2011 and regularly review acquisition opportunities. Our most recent whole bank acquisition was completed in April 2021. We opened a loan and deposit production office in our Texas market in the first quarter of 2024 and converted it to a full-service branch location in the fourth quarter of 2024. We have continued to evaluate opportunities to improve our branch network efficiency, leverage our digital initiatives, and further reduce costs. We closed one branch in our Alabama market during the first quarter of 2024.

Our principal business is lending to and accepting deposits from individuals and small to medium-sized businesses in our areas of operation. As a financial holding company operating through one reportable segment, we generate our income principally from interest on loans and, to a lesser extent, our securities investments, as well as from fees charged in connection with our various loan and deposit services. Our principal expenses are interest expense on interest-bearing customer deposits and borrowings, salaries and employee benefits, occupancy costs, data processing and other operating expenses. We measure our performance through our net interest margin, return on average assets, and return on average equity, among other metrics, while seeking to maintain appropriate regulatory leverage and risk-based capital ratios.

Table of Contents

Certain Events That Affect Period-over-Period Comparability

Changing Inflation and Interest Rates . Inflation increased rapidly during 2021 through June 2022. After June 2022, the rate of inflation generally declined although it has remained above the Federal Reserve’s target inflation rate of 2%. In response, the Federal Reserve raised the federal funds target rate multiple times from March 2022 through July 2023. During 2023, the Federal Reserve raised the federal funds target rate four times, from 4.25% to 4.50%, to 5.25% to 5.50%. During 2024, beginning in September 2024, the Federal Reserve reduced the federal funds target rate three times by 100 basis points on a cumulative basis to 4.25% to 4.50%. Accordingly, the prevailing federal funds target rate in first quarter 2025 was 100 basis points lower than in first quarter 2024.

Disruptions in the Banking Industry . Between March 10, 2023 and March 12, 2023, state banking supervisors closed Silicon Valley Bank and Signature Bank and named the FDIC as receiver. At the time of closure, they were among the 30 largest U.S. banks. While the reasons for their failure are complex and have not been fully investigated, reports indicate that, among other things, both banks had grown in asset size in recent periods at a faster rate than their peers, had large proportions of uninsured deposits (approximately 87.5% and 89.7% of total deposits, respectively) and high unrealized losses on investment securities. Silicon Valley Bank’s business strategy focused on serving the technology and venture capital sectors, and Signature Bank had significant exposure to deposits from the digital asset industry. Prior to their closure, both banks experienced sudden and rapid deposit withdrawals. These events caused bank deposit customers, particularly those with uninsured deposits, to become concerned regarding the safety of their deposits, and in some cases caused customers to withdraw deposits. In response to the disruptions, among other things, the Federal Reserve announced a new BTFP to provide eligible banks with loans of up to one-year maturity backed by collateral pledged at par value. On April 24, 2023, San Francisco-based First Republic Bank, also among the 30 largest U.S. banks, reported a large deposit outflow and substantially reduced net income. First Republic Bank also had a large proportion of uninsured deposits (67% as of December 31, 2022). On May 1, 2023, regulators seized First Republic Bank and sold all of its deposits and most of its assets to JPMorgan Chase Bank.

In response to the disruptions and related publicity, we formed an internal task force that included members of our ALCO. The task force met frequently to review our liquidity position and liquidity sources, and oversaw the Bank’s process to qualify for the BTFP. In addition, we took steps to inform our customers about our financial position, liquidity and insured deposit products. During the second quarter of 2023, we utilized the BTFP and reduced FHLB advances. The Bank utilized this source of funding due to its lower rate, the ability to prepay the obligations without penalty, and as a means to lock in funding. During the fourth quarter of 2023 and again in the first quarter of 2024, the Bank refinanced its BTFP borrowings with new borrowings under the program due to more favorable rates. The Federal Reserve ceased making new loans under the BTFP on March 11, 2024. During the third quarter of 2024, we began paying down borrowings under the BTFP and repaid all of the remaining borrowings under the BTFP in the fourth quarter of 2024 . As of March 31, 2025 , estimated uninsured deposits represented approximately 34% of our total deposits. For additional information, see “Discussion and Analysis of Financial Condition – “Deposits,” “Borrowings,” “Liquidity and Capital Resources” and our Annual Report, Part II. Item 1A. Risk Factors.

Branch Closures. We closed one branch in Anniston, Alabama in January 2024.

Subordinated Debt Repurchases. During the first quarter of 2024, we repurchased $1.0 million in principal amount of our 2032 Notes. During the second quarter of 2024, we repurchased $5.0 million in principal amount of our 2029 Notes and $2.0 million in principal amount of our 2032 Notes.

Subordinated Debt Redemption. During the fourth quarter of 2024, we redeemed all of the remaining $20.0 million in principal amount of the 2029 Notes. As of March 31, 2025 and December 31, 2024 our outstanding subordinated debt consisted of $17.0 million in principal amount of our 2032 Notes.

BOLI Restructuring. During the first quarter of 2024, we surrendered approximately $8.4 million of BOLI and reinvested the proceeds in higher yielding policies.

Hurricane Ida . During the first quarter of 2025, we recorded a $3.3 million recovery of loans previously charged off as a result of a property insurance settlement related to a loan relationship that became impaired in the third quarter of 2021 as a result of Hurricane Ida, and we also recorded related noninterest expense of $0.2 million.

Since the third quarter of 2021 when we recorded an impairment charge of $21.6 million related to this relationship. As of March 31, 2025 , we have recorded total recoveries on the relationship of approximately $7.8 million consisting of net recoveries of $6.0 million of loans previously charged off, noninterest income from a legal settlement of $1.1 million, and a gain on sale of other real estate owned of $0.7 million. At March 31, 2025 , our other real estate owned related to this relationship included two remaining properties with a total cost basis of $1.7 million, which we are actively marketing for sale. Upon sale of these properties, we will have arrived at final resolution of this loan relationship.

Table of Contents

Overview of Financial Condition and Results of Operations

For the three months ended March 31, 2025 , net income was $6.3 million, or $0.63 per diluted common share, compared to net income of $4.7 million, or $0.48 , per diluted common share for the three months ended March 31, 2024 . Net income increased primarily due to a negative provision for credit losses of $3.6 million in the three months ended March 31, 2025 as a result of a $3.3 million recovery of loans previously charged off following a property insurance settlement related to a loan relationship that became impaired in the third quarter of 2021 as a result of Hurricane Ida, compared to a negative provision for credit losses of $1.4 million for the comparable prior period. Also contributing to the increase in net income was a $1.1 million increase in net interest income, which was a result of a $2.4 million decrease in interest expense partially offset by a $1.3 million decrease in interest income. We experienced margin expansion as our cost of funds decreased and our yield on interest-earning assets increased. There was also a $0.9 million increase in noninterest expense and a $0.7 million decrease in noninterest income. The increase in noninterest expense was primarily due to increases in salaries and employee benefits and other operating expenses. In addition, first quarter 2024 noninterest expense was reduced by a $0.2 million gain on early extinguishment of subordinated debt. The decrease in noninterest income is mainly attributable to a gain on sale or disposition of fixed assets of $0.4 million recorded during the three months ended March 31, 2024 primarily resulting from the closure of one branch in the Alabama market, and a decrease in other operating income .

At March 31, 2025 , the Company and Bank each were in compliance with all regulatory capital requirements, and the Bank was considered “well-capitalized” under the FDIC’s prompt corrective action regulations. Other key components of our performance for the three months ended March 31, 2025 are summarized below.

	●	During the three months ended March 31, 2025 , our net interest margin was 2.87% , compared to 2.59% for the three months ended March 31, 2024 .

	●	Credit quality metrics improved as nonperforming loans were 0.27% of total loans at March 31, 2025 compared to 0.42% at December 31, 2024 .

●

Return on average assets increased to 0.94% for the three months ended March 31, 2025 , compared to 0.68% for the three months ended March 31, 2024 . Return on average equity was 10.31% for the three months ended March 31, 2025 , compared to 8.28% for the three months ended March 31, 2024 .

●

Book value per common share reached a record high of $25.63 at March 31, 2025 compared to $24.55 at December 31, 2024 .

●

Total deposits increased $1.4 million, or 0.1% , to $2.35 billion at March 31, 2025 , compared to $2.35 billion at December 31, 2024 . Total deposits, excluding $47.3 million of brokered demand deposits at December 31, 2024, increased $48.7 million, or 2.1%, to $2.35 billion at March 31, 2025, compared to $2.30 billion at December 31, 2024. Noninterest-bearing deposits increased $4.6 million, or 1.1% , to $436.7 million at March 31, 2025 , compared to $432.1 million at December 31, 2024 . As of March 31, 2025 , estimated uninsured deposits represented approximately 34% of our total deposits.

●

Consistent with our strategy of optimizing the balance sheet, t otal loans decreased $18.5 million, or 0.9% , to $2.11 billion at March 31, 2025 , compared to $2.13 billion at December 31, 2024 .

●

Net interest income for the three months ended March 31, 2025 was $18.3 million, an increase of $1.1 million, or 6.6% , compared to $17.2 million for the three months ended March 31, 2024 , driven primarily by a decrease in the volume of short-term borrowings, partially offset by a decrease in the volume of loans.

●

During the three months ended March 31, 2025 , we paid $0.6 million to repur chase 34,992 shares of common stock, compared to $0.2 million to repurchase 10,525 shares of common stock during the three months ended March 31, 2024 . We paid $1.0 million in cash dividends on our common stock during both the three month periods ended March 31, 2025 and 2024 .

●

Accumulated other comprehensive loss d ecreased $5.5 million, or 11.3% , to $42.9 million at March 31, 2025 , compared to $48.4 million at December 31, 2024 primarily due to an increase in the fair value of our AFS securities portfolio.

Table of Contents

Discussion and Analysis of Financial Condition

Loans

General . Loans constitute our most significant asset, comprising 77% and 78% of our total assets at March 31, 2025 and December 31, 2024 , respectively. Total loans decreased $18.5 million, or 0.9% , to $2.11 billion at March 31, 2025 , compared to $2.13 billion at December 31, 2024 . The decrease in loans was primarily the result of lower utilization of credit lines and loan amortization. Given the high interest rate environment, we are emphasizing origination of high margin loans that promote long-term profitability and proactively exiting credit relationships that do not fit this strategy. Our variable-rate loans as a percentage of total loans was 32% at March 31, 2025 and December 31, 2024.

The table below sets forth the balance of loans outstanding by loan type as of the dates presented, and the percentage of each loan type to total loans (dollars in thousands).

	March 31, 2025					December 31, 2024
			Percentage of					Percentage of
	Amount		Total Loans			Amount		Total Loans
Construction and development	$	149,275		7.1	%	$	154,553		7.3	%
1-4 Family		394,735		18.7			396,815		18.7
Multifamily		103,248		4.9			84,576		4.0
Farmland		6,718		0.3			6,977		0.3
Commercial real estate
Owner-occupied ⁽¹⁾		449,963		21.4			449,259		21.1
Nonowner-occupied		481,905		22.9			495,289		23.3
Total mortgage loans on real estate		1,585,844		75.3			1,587,469		74.7
Commercial and industrial ⁽¹⁾		510,765		24.2			526,928		24.8
Consumer		10,022		0.5			10,687		0.5
Total loans	$	2,106,631		100	%	$	2,125,084		100	%

⁽¹⁾	The Company ’ s business lending portfolio consists of loans secured by owner-occupied commercial real estate properties and commercial and industrial loans.

At March 31, 2025 , the Company’s business lending portfolio, which consists of loans secured by owner-occupied commercial real estate properties and commercial and industrial loans, was $960.7 million, a decrease of $15.5 million, or 1.6% , compared to $976.2 million at December 31, 2024 . The decrease in the business lending portfolio is primarily driven by reduced utilization of credit lines, particularly on commercial and industrial relationships.

Nonowner-occupied loans totaled $481.9 million at March 31, 2025, a decrease of $13.4 million, or 2.7%, compared to $495.3 million at December 31, 2024. The decrease in nonowner-occupied loans is primarily due to loan amortization and payoffs that aligned with our continued strategy to optimize and de-risk the mix of the portfolio.

Construction and development loans totaled $149.3 million at March 31, 2025, a decrease of $5.3 million, or 3.4%, compared to $154.6 million at December 31, 2024. The decrease in construction and development loans is primarily due to conversions to permanent loans upon completion of construction.

During the third quarter of 2023 we exited the consumer mortgage loan origination business to transition into shorter duration, higher risk-adjusted return asset classes, in an effort to focus more on our core business and optimize profitability. The consumer mortgage portfolio was approximately $237.6 million and $242.5 million at March 31, 2025 and December 31, 2024, respectively, substantially all of which is included in the 1-4 family category. The remaining loans in the 1-4 family category consisted primarily of second mortgages, home equity loans, home equity lines of credit, and business purpose loans secured by 1-4 family residential real estate.

Table of Contents

Loan Concentrations . Loan concentrations are considered to exist when there are amounts loaned to multiple borrowers engaged in similar activities that would cause them to be similarly impacted by economic or other conditions. At March 31, 2025 and December 31, 2024 , we had no concentrations of loans exceeding 10% of total loans other than loans in the categories listed in the table above.

The table below sets forth the balance of owner-occupied loans by industry based on NAICS code and nonowner-occupied loans by property type as of the dates presented (dollars in thousands).

	March 31, 2025					December 31, 2024
	Amount		Percentage of Total			Amount		Percentage of Total
Owner-Occupied
Retail trade	$	133,085		14	%	$	136,350		15	%
Real estate		65,731		7			67,590		7
Wholesale trade		47,957		5			48,930		5
Healthcare and social assistance		37,407		4			38,950		4
Other services (except public administration)		32,553		4			32,532		4
Accommodation and food services		30,618		3			30,071		3
All other ⁽¹⁾		102,612		11			94,836		10
Total owner-occupied	$	449,963		48	%	$	449,259		48	%

Nonowner-Occupied
Retail	$	163,798		18	%	$	168,033		18	%
Office		95,399		10			97,261		10
Healthcare		94,636		10			95,641		10
Warehouse		59,075		7			57,684		6
Hotel/motel		30,643		3			30,875		3
All other		38,354		4			45,795		5
Total nonowner-occupied	$	481,905		52	%	$	495,289		52	%
Total commercial real estate	$	931,868		100	%	$	944,548		100	%

⁽¹⁾	No individual category within “All other” represents more than 2% of total owner-occupied loans.

The following table sets forth loans outstanding at March 31, 2025 , which, based on remaining scheduled repayments of principal, are due in the periods indicated. Loans with balloon payments and longer amortizations are often repriced and extended beyond the initial maturity when credit conditions remain satisfactory. Demand loans, loans having no stated schedule of repayments and no stated maturity and overdrafts are reported below as due in one year or less (dollars in thousands).

	One Year or Less		After One Year Through Five Years		After Five Years Through Ten Years		After Ten Years Through Fifteen Years		After Fifteen Years		Total
Construction and development	$	109,622	$	34,217	$	2,578	$	2,755	$	103	$	149,275
1-4 Family		74,868		73,578		22,090		17,705		206,494		394,735
Multifamily		33,021		59,423		7,506		—		3,298		103,248
Farmland		1,563		4,998		157		—		—		6,718
Commercial real estate
Owner-occupied		38,993		152,156		154,375		96,828		7,611		449,963
Nonowner-occupied		87,398		248,944		118,109		27,296		158		481,905
Total mortgage loans on real estate		345,465		573,316		304,815		144,584		217,664		1,585,844
Commercial and industrial		298,182		91,673		63,978		55,705		1,227		510,765
Consumer		2,790		5,654		1,339		155		84		10,022
Total loans	$	646,437	$	670,643	$	370,132	$	200,444	$	218,975	$	2,106,631

Table of Contents

Investment Securities

We purchase investment securities primarily to provide a source for meeting liquidity needs, with return on investment a secondary consideration. We also use investment securities as collateral for certain deposits and other types of borrowings. Investment securities represented 14% of our total assets and totaled $388.0 million at March 31, 2025 , an increase of $14.2 million, or 3.8% , from $373.8 million at December 31, 2024 . The increase in investment securities at March 31, 2025 compared to December 31, 2024 was driven primarily by a $13.3 million increase in residential mortgage-backed securities, a $1.2 million increase in corporate bonds and a $1.1 million increase in commercial mortgage-backed securities, partially offset by a $1.1 million decrease in obligations of state and political subdivisions. Net unrealized losses in our AFS investment securities portfolio decreased to $54.5 million at March 31, 2025 compared to $61.4 million at December 31, 2024 primarily due to lower prevailing market interest rates. For additional information, see Note 3. Investment Securities.

The table below shows the carrying value of our investment securities portfolio by investment type and the percentage that such investment type comprises of our entire portfolio as of the dates indicated (dollars in thousands).

	March 31, 2025					December 31, 2024
	Balance		Percentage of Portfolio			Balance		Percentage of Portfolio
Obligations of the U.S. Treasury and U.S. government agencies and corporations	$	15,373		4.0	%	$	15,707		4.2	%
Obligations of state and political subdivisions		55,628		14.3			56,738		15.2
Corporate bonds		28,534		7.3			27,267		7.3
Residential mortgage-backed securities		224,145		57.8			210,837		56.4
Commercial mortgage-backed securities		64,316		16.6			63,259		16.9
Total	$	387,996		100	%	$	373,808		100	%

The investment portfolio consists of AFS and HTM securities. We do not hold any investments classified as trading. We classify debt securities as HTM if management has the positive intent and ability to hold the securities to maturity. HTM debt securities are stated at amortized cost. Securities not classified as HTM are classified as AFS and are stated at fair value . As of March 31, 2025 , AFS securities comprised 89% of our total investment securities.

Due to the nature of the investments, current market prices, and the current interest rate environment, we determined that the declines in the fair values of the AFS and HTM securities portfolio were not attributable to credit losses at March 31, 2025 and December 31, 2024 . Accordingly, there was no adjustment made to the amortized cost basis. The carrying values of our AFS securities are adjusted for unrealized gains or losses not attributable to credit losses as valuation allowances, and any gains or losses are reported on an after-tax basis as a component of other comprehensive income (loss).

The table below sets forth the stated maturities and weighted average yields of our investment debt securities based on the amortized cost of our investment portfolio at March 31, 2025 (dollars in thousands).

	One Year or Less					After One Year Through Five Years					After Five Years Through Ten Years					After Ten Years
	Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield
Held to maturity:
Obligations of state and political subdivisions	$	—		—	%	$	2,477		3.75	%	$	2,740		6.80	%	$	35,004		7.23	%
Residential mortgage-backed securities		—		—			—		—			—		—			2,047		3.11
Available for sale:
Obligations of the U.S. Treasury and U.S. government agencies and corporations		305		4.36			10,585		5.29			4,700		4.53			—		—
Obligations of state and political subdivisions		495		2.11			3,603		2.92			6,391		2.26			6,939		2.61
Corporate bonds		5,250		4.25			8,570		5.06			14,541		4.09			2,249		3.00
Residential mortgage-backed securities		—		—			—		—			2,437		2.45			262,072		2.45
Commercial mortgage-backed securities		—		—			4,462		4.36			1,834		2.67			65,778		3.43
	$	6,050				$	29,697				$	32,643				$	374,089

The maturity of mortgage-backed securities reflects scheduled repayments based upon the contractual maturities of the securities. Weighted average yields on tax-exempt securities are calculated based on amortized cost on a fully tax equivalent basis assuming a federal tax rate of 21%, when applicable.

Table of Contents

Deposits

The following table sets forth the composition of our deposits and the percentage of each deposit type to total deposits at March 31, 2025 and December 31, 2024 (dollars in thousands).

	March 31, 2025					December 31, 2024
	Amount		Percentage of Total Deposits			Amount		Percentage of Total Deposits
Noninterest-bearing demand deposits	$	436,735		18.6	%	$	432,143		18.4	%
Interest-bearing demand deposits		569,903		24.3			554,777		23.7
Money market deposits		240,300		10.2			191,548		8.2
Brokered demand deposits		—		—			47,320		2.0
Savings deposits		136,098		5.8			134,879		5.7
Brokered time deposits		244,935		10.4			245,520		10.5
Time deposits		719,386		30.7			739,757		31.5
Total deposits	$	2,347,357		100	%	$	2,345,944		100	%

Total deposits were $2.35 billion at March 31, 2025 , an increase of $1.4 million, or 0.1% , compared to $2.35 billion at December 31, 2024 . There were no brokered demand deposits at March 31, 2025, compared to $47.3 million at December 31, 2024. Total deposits, excluding $47.3 million of brokered demand deposits at December 31, 2024, increased $48.7 million, or 2.1%, to $2.35 billion at March 31, 2025, compared to $2.30 billion at December 31, 2024. We utilize brokered demand deposits when pricing is more favorable than other short-term borrowings.

The increase in noninterest-bearing demand deposits, interest-bearing demand deposits, money market deposits, and savings deposits at March 31, 2025 compared to December 31, 2024 is primarily the result of organic growth. The decrease in time deposits at March 31, 2025 compared to December 31, 2024 is primarily due to maturities of higher cost time deposits as a result of our strategy to keep duration short. Brokered time deposits decreased to $244.9 million at March 31, 2025 from $245.5 million at December 31, 2024. We utilize brokered time deposits with laddered maturities, entirely in denominations of less than $250,000, to secure fixed cost funding and reduce short-term borrowings. At March 31, 2025, the balance of brokered time deposits remained below 10% of total assets, and the remaining weighted average duration was approximate ly six months with a weighted average rate o f 4.78%.

At March 31, 2025, our estimated uninsured deposits were $803.7 million, or approximately 34% of total deposits, compared to $737.6 million, or approximately 31% of our total deposits at December 31, 2024. The estimates are based on the same methodologies and assumptions used for our regulatory reporting requirements. The insured deposit data does not reflect an evaluation of all of the account ownership category distinctions that would determine the availability of deposit insurance to individual accounts based on FDIC regulations.

Table of Contents

Borrowings

At March 31, 2025 , total borrowings include securities s old under agreements to repurchase, FHLB advances, subordinated debt issued in 2022, an d junior subordinated debentures assumed through acquisitions.

We had $11.3 million of securities sold under agreements to repurchase at March 31, 2025 and $8.4 million at December 31, 2024 . Our advances from the FHLB were $60.0 million at March 31, 2025 , a decrease of $7.2 million, compared to FHLB advances of $67.2 million at December 31, 2024 . Based on original maturities, at March 31, 2025 , all of our FHLB advances were long-term, compared to $7.2 million short-term and $60.0 million long-term FHLB advances at December 31, 2024 . FHLB advances are used to fund new loan and investment activity that is not funded by deposits or other borrowings.

On March 12, 2023, the Federal Reserve established the BTFP. The BTFP was a one-year program which provided additional liquidity through borrowings for a term of up to one year secured by the pledging of certain qualifying securities and other assets valued at par. Beginning in the second quarter of 2023, we utilized the BTFP to secure fixed rate funding for a one-year term and reduce short-term FHLB advances, which are priced daily. We utilized this source of funding due to its lower rate and the ability to prepay the obligations without penalty. The rates on the borrowings under the BTFP were fixed for one year from the day each borrowing was made. During the fourth quarter of 2023 and again in the first quarter of 2024, we refinanced all of our borrowings under the BTFP with new loans under the BTFP with a one-year term due to more favorable rates . The BTFP ceased making new loans as scheduled on March 11, 2024. During the third quarter of 2024, we began paying down borrowings under the BTFP and repaid all of the remaining borrowings under the BTFP in the fourth quarter of 2024. At March 31, 2025 and December 31, 2024, we had no outstanding borrowings under the BTFP.

Typically, the main source of our short-term borrowings are advances from the FHLB ; however, during the three months ended March 31, 2024, our primary source of short-term borrowings were borrowings under the BTFP due to more favorable rates. The rate charged for advances from the FHLB is directly tied to the Federal Reserve’s federal funds target rate. As previously discussed, the Federal Reserve target rate was 5.25% to 5.50% during first quarter 2024 compared to 4.25% to 4.50% during first quarter 2025.

The average balances and cost of short-term borrowings for the three months ended March 31, 2025 and 2024 are summarized in the table below (dollars in thousands).

	Average Balances				Cost of Short-term Borrowings
	Three months ended March 31,				Three months ended March 31,
	2025		2024		2025			2024
Federal funds purchased and short-term FHLB advances	$	38,570	$	219		4.44	%		5.11	%
Borrowings under BTFP		—		230,390		—			4.78
Repurchase agreements		12,071		6,217		0.75			0.13
Total short-term borrowings	$	50,641	$	236,826		3.56	%		4.66	%

The carrying value of the subordinated debt, which consists entirely of our 2032 Notes, was $16.7 million at March 31, 2025 and December 31, 2024 . The $8.8 million and $8.7 million in junior subordinated debt at March 31, 2025 and December 31, 2024 , respectively, represent the junior subordinated debentures that we assumed through acquisitions.

For a description of the 2032 Notes , see our Annual Report, Part II. Item 7. “MD&A – Discussion and Analysis of Financial Condition – Borrowings – 2032 Notes” a nd Note 10 to the financial statements included in such report.

Stockholders ’ Equity

Stockholders’ equity was $251.7 million at March 31, 2025 , an increase of $10.4 million compared to December 31, 2024 . The increase is primarily attributable to $6.3 million of net income for the three months ended March 31, 2025 and a $5.5 million decrease in accumulated other comprehensive loss due to an increase in the fair value of the Bank’s AFS securities portfolio, partially offset by $1.0 million in dividends declared and $0.6 million for share repurchases.

Table of Contents

Results of Operations

Net Interest Income and Net Interest Margin

Net interest income, our principal source of earnings, is the difference between the interest income generated by earning assets and the total interest cost of the deposits and borrowings obtained to fund those assets. Factors affecting the level of net interest income include the volume of earning assets and interest-bearing liabilities, yields earned on loans and investments and rates paid on deposits and other borrowings, the level of nonperforming loans, the amount of noninterest-bearing liabilities supporting earning assets, and the interest rate environment. Net interest margin is the ratio of net interest income to average interest-earning assets.

The primary factors affecting net interest margin are changes in interest rates, competition, and the shape of the interest rate yield curve. The Federal Reserve Board sets various benchmark rates, including the federal funds rate, and thereby influences the general market rates of interest, including the deposit and loan rates offered by financial institutions. The Federal Reserve increased the federal funds target rate four times during 2023, from 4.25% to 4.50%, to 5.25% to 5.50%. During 2024, beginning in September, the Federal Reserve reduced the federal funds target rate three times by 100 basis points on a cumulative basis to 4.25% to 4.50%. Accordingly, the prevailing federal funds target rate in first quarter 2025 was 100 basis points lower than in first quarter 2024. For additional discussion, see Certain Events That Affect Period-over-Period Comparability – Changing Inflation and Interest Rates.

Three months ended March 31, 2025 vs. three months ended March 31, 2024 . Net interest income increased 6.6% to $18.3 million for the three months ended March 31, 2025 compared to $17.2 million for the same period in 2024 . The increase is primarily due to a lower average balance of short-term borrowings and a decrease in the rates paid on brokered time deposits and time deposits, partially offset by a lower average balance of, and a decrease in the yield on, loans and an increase in the average rates paid on and balance of interest-bearing demand deposits. Average short-term borrowings decreased by $186.2 million for the three months ended March 31, 2025 , as we paid all remaining borrowings under the BTFP in the fourth quarter of 2024. The lower average balance of, and a decrease in rates paid on, short-term borrowings resulted in a $2.3 million decrease in interest expense compared to the same period in 2024 . A lower average balance of, and a decrease in rates paid on, time deposits resulted in a $0.9 million decrease in interest expense compared to the same period in 2024 . Average brokered time deposits were $252.3 million during the three months ended March 31, 2025 compared to $255.7 million during the three months ended March 31, 2024 , which, combined with a decrease in rates, resulted in a $0.3 million decrease in interest expense compared to the same period in 2024. Average loans decreased by $86.6 million for the three months ended March 31, 2025 in accordance with our strategy to optimize the balance sheet , which, in addition to lower loan yields, resulted in a $1.6 million decrease in interest income on loans compared to the same period in 2024 . Average interest-bearing demand deposits increased by $91.1 million, which, combined with an increase in rates, resulted in a $0.9 million increase in interest expense in the first quarter of 2025 compared to the same period in 2024. Average noninterest-bearing deposits increased by $1.9 million. Rates paid on interest-bearing liabilities decreased primarily as a result of the overall decrease in prevailing interest rates . Our yield on interest-earning assets increased primarily due to an increase in yield on the investment securities portfolio.

Interest income was $34.4 million for the three months ended March 31, 2025 , compared to $35.7 million for the same period in 2024 . Loan interest income made up substantially all of our interest income for the three months ended March 31, 2025 and 2024 , although interest on investment securities contributed 9.7% of interest income during the first quarter of 2025 compared to 8.6% during the first quarter of 2024 . Of the $1.3 million decrease in interest income, a decrease in interest income of $1.1 million can be attributed to the change in the volume of interest-earnings assets and a decrease of $0.2 million can be attributed to a decrease in the yield earned on interest-earning assets. The overall yield on interest-earning assets was 5.39% and 5.38% for the three months ended March 31, 2025 and 2024 , respectively. The loan portfolio yielded 5.88% and 5.89% for the three months ended March 31, 2025 and March 31, 2024 , respectively, while the yield on the investment portfolio was 3.10% for the three months ended March 31, 2025 compared to 2.81% for the three months ended March 31, 2024 . The increase in the overall yield on interest-earning assets compared to the quarter ended March 31, 2024 was primarily driven by a 29 b asis point increase in the yield on the investment securities portfolio, partially offset by a one basis point decrease in the yield on the loan portfolio.

Interest expense was $16.1 million for the three months ended March 31, 2025 , a decrease of $2.4 million compared to interest expense of $18.5 million for the three months ended March 31, 2024 . A decrease in interest expense of $1.7 million resulted from a decrease in volume of interest-bearing liabilities, primarily short-term borrowings and time deposits, partially offset by an increase in volume of interest-bearing demand deposits. A decrease of $0.7 million resulted from the decrease in the cost of interest-bearing liabilities, primarily time deposits and brokered time deposits, partially offset by an increase in the cost of interest-bearing demand deposits. Average interest-bearing liabilities decreased by $94.9 million for the three months ended March 31, 2025 compared to the same period in 2024 , as average short-term borrowings decreased by $186.2 million while average interest-bearing deposits increased by $82.1 million. Average long-term borrowings increased by $9.1 million primarily due utilization of long-term FHLB advances . We reduced rates on our time deposits during the first quarter of 2025 compared to the first quarter of 2024 due to lower prevailing market interest rates . We increased rates on our interest-bearing demand deposits during the first quarter of 2025 compared to the first quarter of 2024 to attract and retain lower cost deposits relative to higher cost short-term borrowings . The cost of deposits decreased 16 basis points to 3.15% for the three months ended March 31, 2025 compared to 3.31% for the three months ended March 31, 2024 as a result of a lower average balance of, and a decrease in the cost of, time deposits and brokered time deposits, partially offset by a higher average balance of, and an increase in the cost of, interest-bearing demand deposits. The cost of interest-bearing liabilities decreased 29 basis points to 3.22% for the three months ended March 31, 2025 compared to 3.51% for the same period in 2024 , primarily due to a lower average balance of, and a decrease in the cost of, short-term borrowings and a decrease in the cost of time deposits and brokered time deposits, partially offset by a higher cost and average balance of interest-bearing demand deposits.

Net interest margin was 2.87% for the three months ended March 31, 2025 , an increase of 28 basis points from 2.59% for the three months ended March 31, 2024 . The increase in net interest margin was primarily driven by a 29 basis point decrease in the cost of interest-bearing liabilities, partially offset by a one basis point increase in the yield on interest-ear ning assets .

Table of Contents

Average Balances and Yields . The following table sets forth average balance sheet data, including all major categories of interest-earning assets and interest-bearing liabilities, together with the interest earned or paid and the average yield or rate paid on each such category for the three months ended March 31, 2025 and 2024 . Averages presented in the table below are daily averages (dollars in thousands).

	Three months ended March 31,
	2025								2024
				Interest								Interest
	Average			Income/					Average			Income/
	Balance			Expense ⁽¹⁾		Yield/ Rate ⁽¹⁾			Balance			Expense ⁽¹⁾		Yield/ Rate ⁽¹⁾
Assets
Interest-earning assets:
Loans	$	2,108,904		$	30,552		5.88	%	$	2,195,496		$	32,135		5.89	%
Securities:
Taxable		387,538			2,679		2.80			410,761			2,817		2.76
Tax-exempt		50,761			671		5.36			26,963			238		3.55
Interest-earning balances with banks		43,537			532		4.95			36,333			532		5.89
Total interest-earning assets		2,590,740			34,434		5.39			2,669,553			35,722		5.38
Cash and due from banks		26,126								26,246
Intangible assets		41,630								42,243
Other assets		93,989								94,311
Allowance for credit losses		(26,685	)							(30,161	)
Total assets	$	2,725,800							$	2,802,192
Liabilities and stockholders’ equity
Interest-bearing liabilities:
Deposits:
Interest-bearing demand deposits	$	771,623		$	4,079		2.14	%	$	680,548		$	3,166		1.87	%
Brokered demand deposits		8,512			94		4.46			—			—		—
Savings deposits		134,142			351		1.06			134,853			339		1.01
Brokered time deposits		252,276			3,033		4.88			255,694			3,314		5.21
Time deposits		721,162			7,083		3.98			734,474			8,026		4.39
Total interest-bearing deposits		1,887,715			14,640		3.15			1,805,569			14,845		3.31
Short-term borrowings ⁽²⁾		50,641			445		3.56			236,826			2,745		4.66
Long-term debt		85,452			1,004		4.77			76,351			916		4.83
Total interest-bearing liabilities		2,023,808			16,089		3.22			2,118,746			18,506		3.51
Noninterest-bearing deposits		430,080								428,135
Other liabilities		24,347								26,621
Stockholders’ equity		247,565								228,690
Total liabilities and stockholders’ equity	$	2,725,800							$	2,802,192
Net interest income/net interest margin				$	18,345		2.87	%				$	17,216		2.59	%

⁽¹⁾	Interest income and net interest margin are expressed as a percentage of average interest-earning assets outstanding for the indicated periods and are not presented on a tax equivalent basis. Interest expense is expressed as a percentage of average interest-bearing liabilities for the indicated periods.
⁽²⁾	For additional information, see Discussion and Analysis of Financial Condition – Borrowings.

	Three months ended March 31, 2025 vs.
	Three months ended March 31, 2024
	Volume			Rate			Net ⁽¹⁾
Interest income:
Loans	$	(1,267	)	$	(316	)	$	(1,583	)
Securities:
Taxable		(159	)		21			(138	)
Tax-exempt		210			223			433
Interest-earning balances with banks		105			(105	)		—
Total interest-earning assets		(1,111	)		(177	)		(1,288	)
Interest expense:
Interest-bearing demand deposits		424			489			913
Brokered demand deposits		94			—			94
Savings deposits		(2	)		14			12
Brokered time deposits		(44	)		(237	)		(281	)
Time deposits		(146	)		(797	)		(943	)
Short-term borrowings		(2,158	)		(142	)		(2,300	)
Long-term debt		109			(21	)		88
Total interest-bearing liabilities		(1,723	)		(694	)		(2,417	)
Change in net interest income	$	612		$	517		$	1,129

⁽¹⁾	Changes in interest due to both volume and rate have been allocated entirely to rate.

Table of Contents

Noninterest Income

Noninterest income includes, among other things, service charges on deposit accounts, gains and losses on sale or disposition of fixed assets, interchange fees, income from BOLI, and changes in the fair value of equity securities. We expect to continue to develop new products that generate noninterest income, and enhance our existing products, in order to diversify our revenue sources.

Three months ended March 31, 2025 vs. three months ended March 31, 2024 . Total noninterest income decreased $0.7 million, or 26.8% , to $2.0 million for the three months ended March 31, 2025 compared to $2.7 million for the three months ended March 31, 2024 . The decrease in noninterest income was primarily attributable to a $0.4 million decrease in gain on sale or disposition of fixed assets, a $0.2 million decrease in the change in fair value of equity securities, and a $0.2 million decrease in other operating income. During the first quarter of 2024, Investar recorded a $0.4 million gain on sale or disposition of fixed assets as a result of the closure of one branch in the Alabama market. The decrease in other operating income is primarily attributable to a $0.1 million decrease in distributions from other investments and a $0.1 million decrease in the change in net asset value of other investments.

Noninterest Expense

Noninterest expense includes salaries and employee benefits and other costs associated with the conduct of our operations. Our goal is to manage our costs within the framework of our near-term operating strategy of generating consistent, quality earnings.

Three months ended March 31, 2025 vs. three months ended March 31, 2024 . Total noninterest expense was $16.2 million for the three months ended March 31, 2025 , an increase of $0.9 million, or 6.2% , compared to the same period in 2024 . The increase was primarily driven by a $0.4 million increase in salaries and employee benefits, a $0.2 million decrease in gain on early extinguishment of subordinated debt, a $0.2 million increase in professional fees, and a $0.2 million increase in other operating expense, partially offset by a $0.1 million decrease in depreciation and amortization. The increase in salaries and employee benefits is primarily due to investment in people with an emphasis on our Texas markets to remix and strengthen our balance sheet and an increase in health insurance claims. During the first quarter of 2024, Investar repurchased $1.0 million in principal amount of our 2032 Notes and recognized a gain on early extinguishment of subordinated debt of $0.2 million. The increase in other operating expense resulted from a $0.3 million increase in branch services expense, and a $0.2 million increase in collection and repossession expenses, partially offset by a $0.2 million decrease in write down of other real estate owned and a $0.1 million decrease in FDIC assessments. The increase in collection and repossession expenses was primarily due to the property insurance settlement related to a loan relationship that became impaired in the third quarter of 2021 as a result of Hurricane Ida. The decrease in depreciation and amortization is primarily due to the closure of one branch location in the first quarter of 2024.

Income Tax Expense

Income tax expense for each of the three months ended March 31, 2025 and 2024 was $1.4 million . The effective tax rate for the three months ended March 31, 2025 and 2024 was 18.4% and 22.7% , respectively. During the first quarter of 2024, we surrendered approximately $8.4 million of BOLI contracts and reinvested the proceeds in higher yielding policies, which resulted in $0.3 million of income tax expense. The restructuring had an expected earn-back period of just over one year.

For the three months ended March 31, 2025 , the effective tax rate differed from the statutory tax rate of 21% primarily due to tax-exempt interest income earned on certain loans and investment securities and income from BOLI. For the three months ended March 31, 2024 , the effective tax rate differed from the statutory tax rate of 21% primarily due to the surrender of BOLI contracts, partially offset by tax-exempt interest income earned on certain loans and investment securities and income from BOLI.

Risk Management

The primary risks associated with our operations are credit, interest rate and liquidity risk. Changing inflation also presents risk. Credit, inflation and interest rate risk are discussed below, while liquidity risk is discussed in this section under the heading Liquidity and Capital Resources below.

Table of Contents

Credit Risk and the Allowance for Credit Losses

General. The risk of loss should a borrower default on a loan is inherent in any lending activity. Our portfolio and related credit risk are monitored and managed on an ongoing basis by our risk management department, the Board’s loan committee and the full Board. We utilize a ten point risk-rating system, which assigns a risk grade to each borrower based on a number of quantitative and qualitative factors associated with a loan transaction. The risk grade categorizes the loan into one of five risk categories, based on information about the ability of borrowers to service the debt. The information includes, among other factors, current financial information about the borrower, historical payment experience, credit documentation, public information and current economic trends. These categories assist management in monitoring our credit quality. The risk categories, which are consistent with the definitions used in guidance promulgated by federal banking regulators, are as follows.

•

Pass (grades 1-6) – Loans not falling into one of the categories below are considered pass. These loans have high credit characteristics and financial strength. The borrowers at least generate profits and cash flow that are in line with peer and industry standards and have debt service coverage ratios above loan covenants and our policy guidelines. For some of these loans, a guaranty from a financially capable party mitigates characteristics of the borrower that might otherwise result in a lower grade.

•

Special Mention (grade 7) – Loans classified as special mention possess some credit deficiencies that need to be corrected to avoid a greater risk of default in the future. For example, financial ratios relating to the borrower may have deteriorated. Often, a special mention categorization is temporary while certain factors are analyzed or matters addressed before the loan is re-categorized as either pass or substandard.

•

Substandard (grade 8) – Loans rated as substandard are inadequately protected by the current net worth and paying capacity of the borrower or the liquidation value of any collateral. If deficiencies are not addressed, it is likely that this category of loan will result in the Bank incurring a loss. Where a borrower has been unable to adjust to industry or general economic conditions, the borrower’s loan is often categorized as substandard.

•

Doubtful (grade 9) – Doubtful loans are substandard loans with one or more additional negative factors that makes full collection of amounts outstanding, either through repayment or liquidation of collateral, highly questionable and improbable.

•

Loss (grade 10) – Loans classified as loss have deteriorated to such a point that it is not practicable to defer writing off the loan. For these loans, all efforts to remediate the loan’s negative characteristics have failed and the value of the collateral, if any, has severely deteriorated relative to the amount outstanding. Although some value may be recovered on such a loan, it is not significant in relation to the amount borrowed.

At March 31, 2025 and December 31, 2024 , there were no loans classified as loss or doubtful, $29.1 million and $32.7 million, respectively, of loans classified as substandard, and $11.5 million and $7.8 million, respectively, of loans classified as special mention.

An independent loan review is conducted annually, whether internally or externally, on at least 40% of commercial loans utilizing a risk-based approach designed to maximize the effectiveness of the review. Internal loan review is independent of the loan underwriting and approval process. In addition, credit analysts periodically review certain commercial loans to identify negative financial trends related to any one borrower, any related groups of borrowers or an industry. All loans not categorized as pass are put on an internal watch list, with quarterly reports to the Board. In addition, a written status report is maintained by our special assets division for all commercial loans categorized as substandard or worse. We use this information in connection with our collection efforts.

If our collection efforts are unsuccessful, collateral securing loans may be repossessed and sold or, for loans secured by real estate, foreclosure proceedings initiated. The collateral is sold at public auction for fair market value (based upon recent appraisals), with fees associated with the foreclosure being deducted from the sales price. The purchase price is applied to the outstanding loan balance. If the loan balance is greater than the sales proceeds, the deficient balance is charged-off.

Allowance for Credit Losses . We account for the ACL in accordance with ASC 326, which uses the CECL accounting methodology. The CECL methodology requires that lifetime expected credit losses be recorded at the time the financial asset is originated or acquired and be adjusted each period through a provision for credit losses for changes in the expected lifetime credit losses . The ACL was $26.4 million and $26.7 million at March 31, 2025 and December 31, 2024 , respectively.

We maintain a separate ACL on unfunded loan commitments, which is included in “Accrued taxes and other liabilities” in the accompanying consolidated balance sheets. The ACL is generally increased by the provision for credit losses and decreased by charge-offs, net of recoveries. The negative provision for credit losses for the three months ended March 31, 2025 was primarily due to net recoveries on one loan relationship that became impaired in the third quarter of 2021 as a result of Hurricane Ida . The negative provision for credit losses for the three months ended March 31, 2024 was primarily due to a decrease in total loans, aging of existing loans, and, to a lesser extent, the completion of our annual CECL allowance model recalibration, which resulted in lower historical loss rates.

We complete our annual model recalibration process in the first quarter of each year. Our annual review includes peer group analysis, updates to our probability of default and loss-given default models, including prepayment and curtailment assumptions, and qualitative factor scorecard ranges, as needed. The changes resulting from the model recalibration reduced the ACL by approximately $0.5 million during each of the three month periods ended March 31, 2025 and 2024 .

Refer to Note 1. Summary of Significant Accounting Policies – Allowance for Credit Losses in our Annual Report for further discussion of our ACL accounting policy.

Table of Contents

The following table presents the allocation of the ACL by loan category and the percentage of loans in each loan category to total loans as of the dates indicated (dollars in thousands).

	March 31, 2025					December 31, 2024
	Allowance for Credit Losses		% of Loans in each Category to Total Loans			Allowance for Credit Losses		% of Loans in each Category to Total Loans
Mortgage loans on real estate:
Construction and development	$	1,258		7.1	%	$	1,145		7.3	%
1-4 Family		6,552		18.7			5,603		18.7
Multifamily		1,497		4.9			1,185		4.0
Farmland		8		0.3			8		0.3
Commercial real estate		12,018		44.3			11,759		44.4
Commercial and industrial		5,002		24.2			6,933		24.8
Consumer		100		0.5			88		0.5
Total	$	26,435		100	%	$	26,721		100	%

The following table presents the amount of the ACL allocated to each loan category as a percentage of total loans as of the dates indicated.

	March 31, 2025			December 31, 2024
Mortgage loans on real estate:
Construction and development		0.06	%		0.05	%
1-4 Family		0.31			0.26
Multifamily		0.07			0.06
Farmland		0.00			0.00
Commercial real estate		0.57			0.55
Commercial and industrial		0.24			0.33
Consumer		0.00			0.01
Total		1.25	%		1.26	%

As discussed above, the balance in the ACL is principally influenced by the provision for credit losses on loans and net loan loss experience. Additions to the ACL are charged to the provision for credit losses on loans. Losses are charged to the ACL as incurred and recoveries on losses previously charged to the allowance are credited to the allowance at the time the recovery is collected.

The table below reflects the activity in the ACL and key ratios for the periods indicated (dollars in thousands).

	Three months ended March 31,
	2025			2024
Allowance at beginning of period	$	26,721		$	30,540
Provision for credit losses on loans ⁽¹⁾		(3,695	)		(1,411	)
Net recoveries (charge-offs)		3,409			(15	)
Allowance at end of period	$	26,435		$	29,114
Total loans - period end		2,106,631			2,180,578
Nonaccrual loans - period end		5,585			5,649

Key ratios:
Allowance for credit losses to total loans - period end		1.25	%		1.34	%
Allowance for credit losses to nonaccrual loans - period end		473.3	%		515.4	%
Nonaccrual loans to total loans - period end		0.27	%		0.26	%

⁽¹⁾

For the three months ended March 31, 2025 , the $3.6 million negative provision for credit losses on the consolidated statement of income includes a $3.7 million negative provision for loan losses and a $0.1 million provision for unfunded loan commitments. For the three months ended March 31, 2024, the $1.4 million negative provision for credit losses on the consolidated statement of income includes a $1.4 million negative provision for loan losses and a $9,000 negative provision for unfunded loan commitments.

Table of Contents

The ACL to total loans decreased to 1.25% at March 31, 2025 compared to 1.34% at March 31, 2024 , and the ACL to nonaccrual loans ratio decreased to 473.3% at March 31, 2025 compared to 515.4% at March 31, 2024 . The decrease in the ACL to total loans compared to March 31, 2024 is primarily due to a decrease in total loans, aging of existing loans and an improvement in the economic forecast . The decrease in ACL to nonaccrual loans compared to March 31, 2024 is primarily due to a decrease in the ACL. Nonaccrual loans were $5.6 million, or 0.27% of total loans, at March 31, 2025 , a decrease of $64,000 compared to $5.6 million, or 0.26% of total loans, at March 31, 2024 . The decrease in nonaccrual loans is primarily due to paydowns.

The following table presents the allocation of net (charge-offs) recoveries by loan category for the periods indicated (dollars in thousands).

	Three months ended March 31,
	2025								2024
	Net Recoveries (Charge-offs)			Average Balance		Ratio of Net Charge-offs (Recoveries) to Average Loans			Net Recoveries (Charge-offs)			Average Balance		Ratio of Net Charge-offs (Recoveries) to Average Loans
Mortgage loans on real estate:
Construction and development	$	1		$	146,786		(0.00	)%	$	9		$	179,829		(0.01	)%
1-4 Family		(15	)		394,162		0.00			5			411,057		(0.00	)
Multifamily		—			93,735		—			—			105,388		—
Farmland		—			6,899		—			36			7,572		(0.48	)
Commercial real estate		3,314			941,349		(0.35	)		—			947,939		—
Commercial and industrial		131			515,494		(0.03	)		(35	)		532,078		0.01
Consumer		(22	)		10,479		0.21			(30	)		11,633		0.26
Total	$	3,409		$	2,108,904		(0.16	)%	$	(15	)	$	2,195,496		0.00	%

Charge-offs reflect the realization of losses in the portfolio that were recognized previously through the provision for credit losses on loans. Net charge-offs include recoveries of amounts previously charged off. For the three months ended March 31, 2025 , net recoveries were $3.4 million, or 0.16%, of the average loan balance for the period. Net recoveries during the three months ended March 31, 2025 were primarily the result of a property insurance settlement related to a loan relationship that became impaired in the third quarter of 2021 as a result of Hurricane Ida . Net charge-offs for the three months ended March 31, 2024 were $15,000, or less than 0.01%, of the average loan balance for the period. Net charge-offs during the three months ended March 31, 2024 were primarily attributable to commercial and industrial and consumer loans.

Management believes the ACL at March 31, 2025 is sufficient to provide adequate protection against losses in our portfolio. However, there can be no assurance that this allowance will prove to be adequate over time to cover ultimate losses in connection with our loans. This allowance may prove to be inadequate due to higher inflation and interest rates than anticipated, other unanticipated adverse changes in the economy, unanticipated effects of the current geopolitical and domestic political conflicts, a public health crisis, or discrete events adversely affecting specific customers or industries. We are monitoring changes and potential changes to U.S. tariff and trade policies, particularly those occurring after the end of first quarter 2025. The current environment is dynamic and uncertain. Changing U.S. tariff and trade policies could cause higher inflation, higher interest rates and slower economic growth or recession in the U.S., at least in the near term. These changes and uncertainties regarding future changes could cause deterioration in credit quality that could lead us to increase our ACL in future periods. Our results of operations and financial condition could be materially adversely affected to the extent that the allowance is insufficient to cover such changes or events.

Nonperforming Asse ts . No nperforming assets consist of nonperforming loans and other real estate owned. Nonperforming loans are those on which the accrual of interest has stopped or loans which are contractually 90 days past due on which interest continues to accrue. Loans are ordinarily placed on nonaccrual when a loan is specifically determined to be impaired or when principal and interest is delinquent for 90 days or more. Additionally, management may elect to continue the accrual when the estimated net available value of collateral is sufficient to cover the principal balance and accrued interest. It is our policy to discontinue the accrual of interest income on any loan for which we have reasonable doubt as to the payment of interest or principal. A loan may be returned to accrual status when all the principal and interest amounts contractually due are brought current and future principal and interest amounts contractually due are reasonably assured, which is typically evidenced by a sustained period of repayment performance by the borrower. Nonperforming loans were $5.6 million, or 0.27% of total loans, at March 31, 2025 , a decrease of $3.2 million compared to $8.8 million, or 0.42% of total loans, at December 31, 2024 . The decrease in nonperforming loans compared to December 31, 2024 is mainly attributable to paydowns.

Loan Modifications to Borrowers Experiencing Financial Difficulty. Occasionally, we modify loans to borrowers in financial distress by providing certain concessions, such as principal forgiveness, an interest rate reduction, an other-than-insignificant payment delay, or a term extension, excluding covenant waivers and modification of contingent acceleration clauses, or a combination of such concessions. When principal forgiveness is provided, the amount of forgiveness is charged-off against the ACL . Upon the Company’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or portion of the loan) is written off. During the three months ended March 31, 2025 and 2024 , we did not provide any modifications under these circumstances to borrowers experiencing financial difficulty.

Table of Contents

Other Real Estate Owned. Other real estate owned consists of properties acquired through foreclosure or acceptance of a deed in lieu of foreclosure and real property no longer used in the Bank’s business operations. Real estate acquired through foreclosure is initially recorded at fair value at the time of foreclosure, less estimated selling cost, and any related write-down is charged to the ACL. Real property no longer used in the Bank’s business operations is recorded at the lower of its net book value or fair value at the date of transfer to other real estate owned.

For the three months ended March 31, 2025 , additions to other real estate owned were $1.0 million, which were driven by transfers of commercial real estate loans to other real estate owned. No other real estate owned wa s sold during the three months ended March 31, 2025 and 2024 . During the three months ended March 31, 2024 , we recorded a $0.2 million write-down of other real estate owned primarily related to a former branch location based on a third-party appraisal. At March 31, 2025 , approximately $1.0 million of loans secured by 1-4 family residential property were in the process of foreclosure.

The table below provides details of our other real estate owned as of the dates indicated (dollars in thousands).

	March 31, 2025		December 31, 2024
1-4 Family	$	1,684	$	1,684
Commercial real estate		4,309		3,358
Commercial and industrial		176		176
Total other real estate owned	$	6,169	$	5,218

Changes in our other real estate owned are summarized in the table below for the periods indicated (dollars in thousands).

	Three months ended March 31,
	2025		2024
Balance, beginning of period	$	5,218	$	4,438
Additions		951		42
Write-downs		—		(233	)
Balance, end of period	$	6,169	$	4,247

Impact of Inflation . Inflation reached a near 40-year high in late 2021 primarily due to effects of the COVID-19 pandemic, and continued rising through June 2022. After June 2022, the rate of inflation generally declined; however, it has remained higher than the Federal Reserve’s target inflation rate of two percent. In response to higher inflation, the Federal Reserve increased the federal funds target rate during 2022 and 2023 as discussed in Certain Events That Affect Period-over-Period Comparability – Changing Inflation and Interest Rates , which generally increased the amount we earn on our interest-earning assets but also increased the amount we pay on our interest-bearing liabilities as discussed throughout this report. We believe that higher rates resulting from inflation and related factors led to constrained loan demand during 2023 and 2024 and through March 31, 2025. When the rate of inflation accelerates, there is an erosion of consumer and customer purchasing power. Accordingly, if the rate of inflation accelerates in the future, this could impact our business by reducing our tolerance for extending credit, and our customer’s desire to obtain credit, or causing us to incur additional provisions for credit losses resulting from a possible increased default rate. Inflation and related higher rates have led and may continue to lead to lower loan re-financings. Inflation has also increased and may continue to increase the costs of goods and services we purchase, including the costs of salaries and benefits . We are monitoring changes and potential changes to U.S. tariff and trade policies, particularly those occurring after the end of first quarter 2025. The current environment is dynamic and uncertain. Changing U.S. tariff and trade policies could cause higher inflation, higher interest rates and slower economic growth or recession in the U.S., at least in the near term.

As noted above, the rate of inflation generally declined after June 2022. In response, from September 2024 to December 2024, the Federal Reserve reduced the federal funds target rate by 100 basis points to 4.25% to 4.50%, where it remained as of May 7, 2025. As noted above, the inflationary outlook in the U.S. remains uncertain. A decrease in the general level of interest rates may lead to, among other things, prepayments on our loan and mortgage-backed securities portfolios as borrowers refinance their loans at lower rates, lower rates on new loans, lower rates on existing variable rate loans and lower yields on investment securities, which may be offset by lower costs of interest-bearing liabilities. If interest-earning assets mature or reprice more quickly, or to a greater degree than interest-bearing liabilities, falling interest rates could reduce net interest income. Significant fluctuations in interest rates makes our business and balance sheet more challenging to manage. For additional information, see Interest Rate Risk below, and Item 1A. “Risk Factors – Risks Related to our Business – Changes in interest rates could have an adverse effect on our profitability ” and – “Inflation and rising prices may continue to adversely affect our results of operations and financial condition ” in our Annual Report.

Table of Contents

Interest Rate Risk

Market risk is the risk of loss from adverse changes in market prices and rates. Since the majority of our assets and liabilities are monetary in nature, our market risk arises primarily from interest rate risk inherent in our lending and deposit activities. A sudden and substantial change in interest rates may adversely impact our earnings and profitability because the interest rates borne by assets and liabilities do not change at the same speed, to the same extent, or on the same basis. Accordingly, our ability to proactively structure the volume and mix of our assets and liabilities to address anticipated changes in interest rates, as well as to react quickly to such fluctuations, can significantly impact our financial results. To that end, management actively monitors and manages our interest rate risk exposure.

The ALCO has been authorized by the Board to implement our asset/liability management policy, which establishes guidelines with respect to our exposure to interest rate fluctuations, liquidity, loan limits as a percentage of funding sources, exposure to correspondent banks and brokers and reliance on non-core deposits. The goal of the policy is to enable us to maximize our interest income and maintain our net interest margin without exposing the Bank to excessive interest rate risk, credit risk and liquidity risk. Within that framework, the ALCO monitors our interest rate sensitivity and makes decisions relating to our asset/liability composition.

Net interest income simulation is the Bank’s primary tool for benchmarking near term earnings exposure. Given the ALCO’s objective to understand the potential risk and volatility embedded within the current mix of assets and liabilities, standard rate scenario simulations assume total assets remain static (i.e. no growth). The Bank may also use a standard gap report in its interest rate risk management process. The primary use for the gap report is to provide supporting detailed information to the ALCO’s discussion.

The Bank has particular concerns with the utility of the gap report as a risk management tool because of difficulties in relating gap directly to changes in net interest income. Hence, the income simulation is the key indicator for earnings-at-risk since it expressly measures what the gap report attempts to estimate.

Short term interest rate risk management tactics are decided by the ALCO where risk exposures exist out into the one to two-year horizon. Tactics are formulated and presented to the ALCO for discussion, modification, and/or approval. Such tactics may include asset and liability acquisitions of appropriate maturities in the cash market, loan and deposit product/pricing strategy modification, and derivatives hedging activities to the extent such activity is authorized by the Board.

Since the impact of rate changes due to mismatched balance sheet positions in the short-term can quickly and materially affect the current year’s income statement, they require constant monitoring and management.

Within the gap position that management directs, we attempt to structure our assets and liabilities to minimize the risk of either a rising or falling interest rate environment. We manage our gap position for time horizons of one month, two months, three months, four to six months, seven to twelve months, 13-24 months, 25-36 months, 37-60 months and more than 60 months. The goal of our asset/liability management is for the Bank to maintain a net interest income at risk in an up or down 100 basis point environment at less than (5)%. At March 31, 2025 , the Bank was within the policy guidelines for asset/liability management.

Table of Contents

The table below de picts the estimated impact on net interest income of immediate changes in interest rates at the specified levels.

As of March 31, 2025
Changes in Interest Rates (in basis points)		Estimated Increase/Decrease in Net Interest Income ⁽¹⁾
+300		(2.0)%
+200		(1.6)%
+100		(0.5)%
-100		0.8%
-200		0.9%
-300		0.7%

⁽¹⁾	The percentage change in this column represents the projected net interest income for 12 months on a flat balance sheet in a stable interest rate environment versus the projected net interest income in the various rate scenarios.

The computation of the prospective effects of hypothetical interest rate changes requires numerous assumptions regarding characteristics of new business and the behavior of existing positions. These business assumptions are based upon our experience, business plans and published industry experience. Key assumptions include asset prepayment speeds, competitive factors, the relative price sensitivity of certain assets and liabilities, and the expected life of non-maturity deposits. However, there are a number of factors that influence the effect of interest rate fluctuations on us which are difficult to measure and predict. For example, a rapid drop in interest rates might cause our loans to repay at a more rapid pace and certain mortgage-related investments to prepay more quickly than projected. This could mitigate some of the benefits of falling rates as are expected when we are in a negatively-gapped position. Conversely, a rapid rise in rates could give us an opportunity to increase our margins and stifle the rate of repayment on our mortgage-related loans which would increase our returns; however, we may need to increase the rates we offer to maintain or increase deposits, which would adversely impact our margins. As a result, because these assumptions are inherently uncertain, actual results will differ from simulated results.

Liquidity and Capital Resources

Liquidity. Liquidity is a measure of the ability to fund loan commitments and meet deposit maturities and withdrawals in a timely and cost-effective way. Cash flow requirements can be met by generating net income, attracting new deposits, converting assets to cash or borrowing funds. While maturities and scheduled amortization of loans and securities are predictable sources of funds, deposit outflows, loan prepayments, loan sales and borrowings are greatly influenced by general interest rates, economic conditions and the competitive environment in which we operate. To minimize funding risks, we closely monitor our liquidity position through periodic reviews of maturity profiles, yield and rate behaviors, and loan and deposit forecasts. Excess short-term liquidity is usually invested in overnight federal funds sold.

Our core deposits, which are deposits excluding time deposits greater than $250,000 and deposits of municipalities and other political entities, are our most stable source of liquidity to meet our cash flow needs due to the nature of the long-term relationships generally established with our customers. Maintaining the ability to acquire these funds as needed in a variety of markets, and within ALCO compliance targets, is essential to ensuring our liquidity. At March 31, 2025 and December 31, 2024 , 69% and 68%, respectively, of our total assets were funded by core deposits.

Our investment portfolio is another alternative for meeting our cash flow requirements. Investment securities generate cash flow through interest payments, principal payments and maturities, and they generally have readily available markets that allow for their conversion to cash. At March 31, 2025 , 89% of our investment securities portfolio was classified as AFS, and we had gross unrealized losses in our AFS investment securities portfolio of $54.8 million and gross unrealized gains of $0.3 million. The sale of securities in a loss position would cause us to record a loss on sale of investment securities in noninterest income in the period during which the securities were sold. Some securities are pledged to secure certain deposit types or short-term borrowings, such as FHLB advances, which impacts their liquidity. At March 31, 2025 , securities with a carrying value of $67.4 million were pledged to secure certain deposits, borrowings, and other liabilities, compared to $68.1 million i n pledged securities at December 31, 2024.

Other sources available for meeting liquidity needs include advances from the FHLB, repurchase agreements and other borrowings. FHLB advances may be used to meet day to day liquidity needs, particularly if the prevailing interest rate on an FHLB advance compares favorably to the rates that we would be required to pay to attract deposits. At March 31, 2025 , the balanc e of our outstanding advances with the FHLB was $60.0 million, all of which were long-term advances based on original maturity, a decrease of $7.2 million, compared to $67.2 million, consisting of $7.2 million short-term and $60.0 million long-term advances based on original maturities, at December 31, 2024. The total amount of remaining credit available to us from the FHLB at March 31, 2025 was $712.5 million . At March 31, 2025 , our FHLB borrowings were collateralized by a blanket pledge of certain loans totaling approximately $951.7 million .

Repurchase agreements are contracts for the sale of securities which we own with a corresponding agreement to repurchase those securities at an agreed upon price and date. Our policies limit the use of repurchase agreements to those collateralized by investment securities. We had $11.3 milli on of repurchase agreements outstanding at March 31, 2025 and $8.4 million at December 31, 2024 .

Table of Contents

We maintain unsecured lines of credit with First National Bankers Bank and The Independent Bankers Bank totaling $60.0 million. These lines of credit are federal funds lines of credit and are used for overnight borrowing only. The lines of credit mature at various times within the next year. There were no outstanding balances on our unsecured lines of credit at March 31, 2025 and December 31, 2024 .

At March 31, 2025 , we held $43.5 million of cash and cash equivalents and maintained approximate ly $712.5 million o f available funding from FHLB advances and maintained $60.0 million in unsecured lines of credit with correspondent banks. Cash and cash equivalents and available funding represen t 102% of uninsured deposits of $803.7 million at March 31, 2025 .

In addition, at March 31, 2025 and December 31, 2024 , we had $17.0 million in aggregate principal amount of subordinated debt outstanding, consisting entirely of our 2032 Notes. For additional information on our 2032 Notes, see our Annual Report, Part II. Item 7. “MD&A – Discussion and Analysis of Financial Condition – Borrowings” and Note 10 to the financial statements included in such report.

Our liquidity strategy is focused on using the least costly funds available to us in the context of our balance sheet composition and interest rate risk position. Accordingly, we target growth of noninterest-bearing deposits. Although we cannot directly control the types of deposit instruments our customers choose, we can influence those choices with the interest rates and deposit specials we offer. In recent years, the proportion of our deposits represented by noninterest-bearing deposits has declined primarily due to rising market interest rates as customers have migrated to higher yielding alternatives , although such proportion increased as of the end of first quarter 2025 as rates declined in the latter part of 2024 . At March 31, 2025 , we held $244.9 million of brokered time deposits and no brokered demand deposits as defined for federal regulatory purposes. At December 31, 2024 , we held $245.5 million of brokered time deposits and $47.3 million of brokered demand deposits as defined for federal regulatory purposes. W e utilize brokered time deposits to secure fixed cost funding and reduce short-term borrowings. We utilize brokered demand deposits when pricing is more favorable than other short-term borrowings. We hold QwickRate® deposits, included in our time deposit balances, which we obtain through a qualified network, to address liquidity needs when rates on such deposits compare favorably with deposit rates in our markets. At March 31, 2025 , we h eld $7.7 million of QwickRate® deposits, a decrease of $5.2 million compared to $12.9 million at December 31, 2024 .

The following table presents, by type, our funding sources, which consist of total average deposits and borrowed funds, as a percentage of total funds and the total cost of each funding source for the three months ended March 31, 2025 and 2024 .

	Percentage of Total Average Deposits and Borrowed Funds						Cost of Funds
	Three months ended March 31,						Three months ended March 31,
	2025			2024			2025			2024
Noninterest-bearing demand deposits		18	%		17	%		—	%		—	%
Interest-bearing demand deposits		32			27			2.14			1.87
Brokered demand deposits		—			—			4.46			—
Savings accounts		6			5			1.06			1.01
Brokered time deposits		10			10			4.88			5.21
Time deposits		29			29			3.98			4.39
Short-term borrowings		2			9			3.56			4.66
Long-term borrowed funds		3			3			4.77			4.83
Total deposits and borrowed funds		100	%		100	%		2.66	%		2.92	%

Capital Resources . Our primary sources of capital include retained earnings, capital obtained through acquisitions, and proceeds from the sale of our capital stock and subordinated debt. We may issue additional common stock and debt securities from time to time to fund acquisitions and support our organic growth.

During the three months ended March 31, 2025 and 2024, we paid $1.0 m illion in dividends . We declared dividends on our common stock of $0.105 per share during the three months ended March 31, 2025 compared to dividends of $0.10 per share during the three months ended March 31, 2024 . Our Board has authorized a share repurchase program, and at March 31, 2025 , we had 460,653 shar es of our common stock remaining authorized for repurchase under the program. During the three months ended March 31, 2025 , we paid $0.6 million to repurchase 34,992 shares of our common stock, compared to paying $0.2 million to repurchas e 10,525 s hares of our common stock during the three months ended March 31, 2024 . The aggregate purchase price does not include the effect of excise tax expense incurred on net share repurchases.

Table of Contents

We are subject to various regulatory capital requirements administered by the Federal Reserve and the OCC which specify capital tiers, including the following classifications for the Bank under the OCC’s prompt corrective action regulations.

Capital Tiers ⁽¹⁾	Tier 1 Leverage Ratio	Common Equity Tier 1 Capital Ratio	Tier 1 Capital Ratio	Total Capital Ratio	Ratio of Tangible to Total Assets
Well capitalized	5% or above	6.5% or above	8% or above	10% or above
Adequately capitalized	4% or above	4.5% or above	6% or above	8% or above
Undercapitalized	Less than 4%	Less than 4.5%	Less than 6%	Less than 8%
Significantly undercapitalized	Less than 3%	Less than 3%	Less than 4%	Less than 6%
Critically undercapitalized					2% or less

⁽¹⁾

In order to be well capitalized or adequately capitalized, a bank must satisfy each of the required ratios in the table. In order to be undercapitalized or significantly undercapitalized, a bank would need to fall below just one of the relevant ratio thresholds in the table. In order to be well capitalized, the Bank cannot be subject to any written agreement or order requiring it to maintain a specific level of capital for any capital measure. Pursuant to regulatory capital rules, the Company has made an election not to include unrealized gains and losses in the investment securities portfolio for purposes of calculating “Tier 1” capital and “Tier 2” capital.

The Company and the Bank each were in compliance with all regulatory capital requirements at March 31, 2025 and December 31, 2024 . The Bank also was considered “well-capitalized” under the OCC’s prompt corrective action regulations as of these dates.

The following table presents the actual capital amounts and regulatory capital ratios for the Company and the Bank as of the dates presented (dollars in thousands).

	Actual					Minimum Capital Requirement for Bank to be Well Capitalized Under Prompt Corrective Action Rules
	Amount		Ratio			Amount		Ratio
March 31, 2025
Investar Holding Corporation:
Tier 1 leverage capital	$	263,272		9.56	%	$	—		—	%
Common equity tier 1 capital		253,772		11.16			—		—
Tier 1 capital		263,272		11.57			—		—
Total capital		306,175		13.46			—		—
Investar Bank:
Tier 1 leverage capital		275,698		10.03			137,457		5.00
Common equity tier 1 capital		275,698		12.14			147,636		6.50
Tier 1 capital		275,698		12.14			181,706		8.00
Total capital		301,894		13.29			227,133		10.00

December 31, 2024
Investar Holding Corporation:
Tier 1 leverage capital	$	258,178		9.27	%	$	—		—	%
Common equity tier 1 capital		248,678		10.84			—		—
Tier 1 capital		258,178		11.25			—		—
Total capital		301,259		13.13			—		—
Investar Bank:
Tier 1 leverage capital		269,733		9.70			139,092		5.00
Common equity tier 1 capital		269,733		11.77			148,925		6.50
Tier 1 capital		269,733		11.77			183,293		8.00
Total capital		296,117		12.92			229,116		10.00

Off-Balance Sheet Transactions and Lease Obligations

Swap Contracts. The Bank historically has entered into interest rate swap contracts, some of which are forward starting, to manage exposure against the variability in the expected future cash flows (future interest payments) attributable to changes in the one-month SOFR associated with the forecasted issuances of one-month fixed rate debt arising from a rollover strategy. An interest rate swap is an agreement whereby one party agrees to pay a fixed rate of interest on a notional principal amount in exchange for receiving a floating rate of interest on the same notional amount for a predetermined period of time, from a second party. At March 31, 2025 and December 31, 2024 , we had no current or forward starting interest rate swap agreements, other than interest rate swaps related to customer loans, described below. For additional information, see Note 6. Derivative Financial Instruments.

Table of Contents

The Company also enters into interest rate swap contracts that allow commercial loan customers to effectively convert a variable-rate commercial loan agreement to a fixed-rate commercial loan agreement. Under these agreements, the Company enters into a variable-rate loan agreement with a customer in addition to an interest rate swap agreement, which serves to effectively swap the customer’s variable-rate loan into a fixed-rate loan. The Company then enters into a corresponding swap agreement with a third party in order to economically hedge its exposure through the customer agreement. The interest rate swaps with both the customers and third parties are not designated as hedges under ASC 815 , and are marked to market through earnings. As the interest rate swaps are structured to offset each other, changes to the underlying benchmark interest rates considered in the valuation of these instruments do not result in an impact to earnings; however, there may be fair value adjustments related to credit quality variations between counterparties, which may impact earnings as required by ASC 820 . The Company did not recognize any gains or losses in other income resulting from fair value adjustments during the three months ended March 31, 2025 and 2024 . At March 31, 2025 and December 31, 2024 , we had notional amo unts of $183.3 million and $186.9 million, respectively, in interest rate swap contracts with customers and $183.3 million and $186.9 million, respectively, in offsetting interest rate swap contracts with other financial institutions. At March 31, 2025 and December 31, 2024 , the fair value of the swap contracts consisted of gross assets of $15.1 million and $17.2 million, respectively, and gross liabilities of $15.1 million and $17.2 million, respectively, record ed in “Other assets” and “Accrued taxes and other liabilities”, respectively, in the accompanying consolidated balance sheets.

Unfunded Commitments . The Bank enters into loan commitments and standby letters of credit in the normal course of its business. Loan commitments are made to meet the financing needs of our customers, while standby letters of credit commit the Bank to make payments on behalf of customers when certain specified future events occur. The credit risks associated with loan commitments and standby letters of credit are essentially the same as those involved in making loans to our customers. Accordingly, our normal credit policies apply to these arrangements. Collateral (e.g., securities, receivables, inventory, equipment, etc.) is obtained based on management’s credit assessment of the customer. Loan commitments are also evaluated in a manner similar to the ACL on loans. The reserve for unfunded loan commitments is included in “Accrued taxes and other liabilities” in the accompanying consolidated balance sheets and was $0.1 million and $42,000 at March 31, 2025 and December 31, 2024 , respectively.

Loan commitments and standby letters of credit do not necessarily represent future cash requirements, in that while the customer typically has the ability to draw upon these commitments at any time, these commitments often expire without being drawn upon in full or at all. Substantially all of our standby letters of credit expire within one year. Our unfunded loan commitments and standby letters of credit outstanding are summarized below as of the dates indicated (dollars in thousands):

	March 31, 2025		December 31, 2024
Loan commitments	$	377,821	$	377,301
Standby letters of credit		7,504		7,658

The Company closely monitors the amount of remaining future commitments to borrowers in light of prevailing economic conditions and adjusts these commitments as necessary. The Company intends to continue this process as new commitments are entered into or existing commitments are renewed.

Additionally, at March 31, 2025 , the Company had unfunded commitments of $0.9 million for its investment in SBIC qualified funds and other investment funds.

For the three months ended March 31, 2025 and for the year ended December 31, 2024 , except as disclosed herein and in the Company’s Annual Report, we engaged in no off-balance sheet transactions that we believe are reasonably likely to have a material effect on our financial condition, results of operations, or cash flows.

Lease Obligations. The Company’s primary leasing activities relate to certain real estate leases entered into in support of the Company’s branch operations. The Company’s branch locations operated under lease agreements have all been designated as operating leases. The Company does not lease equipment under operating leases, nor does it have leases designated as finance leases.

The following table presents, as of March 31, 2025 , contractually obligated lease payments due under non-cancelable operating leases by payment date (dollars in thousands).

Less than one year	$	455
One to three years		905
Three to five years		697
Over five years		294
Total	$	2,351

Table of Contents

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Quantitative and qualitative disclosures about market risk as of December 31, 2024 are set forth in the Company’s Annual Report in the section captioned “MD&A – Risk Management.” Please refer to the information in Item 2. “MD&A,” under the heading “Risk Management” in this report for additional information about the Company’s market risk for the three months ended March 31, 2025 ; except as discussed therein, there have been no material changes in the Company’s market risk since December 31, 2024 .

Item 4. Controls and Procedures

Based on their evaluation as of the end of the period covered by this Quarterly Report on Form 10-Q, the Company’s Principal Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) are effective for ensuring that information the Company is required to disclose in the reports that it files or submits under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

There were no changes in the Company’s internal control over financial reporting during the fiscal quarter covered by this quarterly report that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Table of Contents

PART II. OTHER INFORMATION

Item 1A. Risk Factors

For information regarding material risk factors that could affect the Company’s results of operations, financial condition and liquidity, see the risk factors disclosed in Part I. Item 1A. “Risk Factors” in the Annual Report. There have been no material changes in our risk factors as described in such Annual Report, except for certain heightened risks relating to changing U.S. trade and tariff policies particularly since the end of first quarter 2025, as discussed in “MD&A – Risk Management – Credit Risk and the Allowance for Credit Losses,” which discussion is incorporated by reference herein.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Unregistered Sales of Equity Securities

None.

Table of Contents

Issuer Purchases of Equity Securities

The table below provides information with respect to purchases made by the Company of shares of its common stock during each of the months during the three month period ended March 31, 2025 .

Period	(a) Total Number of Shares (or Units) Purchased ⁽¹⁾		(b) Average Price Paid per Share (or Unit)		(c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs		(d) Maximum Number (or Approximate Dollar Value) of Shares (or Units) That May Be Purchased Under the Plans or Programs
January 1, 2025 - January 31, 2025		3,500	$	19.18		3,500		492,145
February 1, 2025 - February 28, 2025		19,805		18.82		19,492		472,653
March 1, 2025 - March 31, 2025		43,167		17.95		12,000		460,653
		66,472	$	18.27		34,992		460,653

⁽¹⁾	Includes 4,293 s h ares of common stock surrendered to cover the payroll taxes due upon the vesting of RSUs and 27,187 shares of common stock surrendered to satisfy the net exercise of stock options and related tax withholding obligations .
⁽²⁾	The Comp any has had a stock repurchase program since 2015. As of March 31, 2025, the Company had 460,653 shares remaining avail able under the program.

Because we are a holding company with no material business activities, our ability to pay dividends is substantially dependent upon the ability of the Bank to transfer funds to us in the form of dividends, loans and advances. The Bank’s ability to pay dividends and make other distributions and payments to us depends upon the Bank’s earnings, financial condition, general economic conditions, compliance with regulatory requirements and other factors. In addition, the Bank’s ability to pay dividends to us is itself subject to various legal, regulatory and other restrictions under federal banking laws that are described in Part I. Item 1. “Business” of our Annual Report.

In addition, as a Louisiana corporation, we are subject to certain restrictions on dividends under the Louisiana Business Corporation Act. Generally, a Louisiana corporation may pay dividends to its shareholders unless, after giving effect to the dividend, either (1) the corporation would not be able to pay its debts as they come due in the usual course of business or (2) the corporation’s total assets are less than the sum of its total liabilities and the amount that would be needed, if the corporation were to be dissolved at the time of the payment of the dividend, to satisfy the preferential rights of shareholders whose preferential rights are superior to those receiving the dividend. In addition, our existing and future debt agreements limit, or may limit, our ability to pay dividends. Under the terms of our 2032 Notes, we are prohibited from paying dividends upon and during the continuance of any Event of Default under such notes. Finally, our ability to pay dividends may be limited on account of the junior subordinated debentures that we assumed through acquisitions. We must make payments on the junior subordinated debentures before any dividends can be paid on our common stock.

Table of Contents

Item 6. Exhibits

Exhibit No.						Description of Exhibit

3.1						Restated Articles of Incorporation of Investar Holding Corporation ⁽¹⁾

3.2						Amended and Restated By-laws of Investar Holding Corporation ⁽²⁾

4.1						Specimen Common Stock Certificate ⁽³⁾

4.2						Indenture, dated April 6, 2022, by and among Investar Holding Corporation and UMB Bank, National Association, as trustee ⁽⁴⁾

4.3						Form of 5.125% Fixed-to-Floating Rate Subordinated Note due 2032 ⁽⁵⁾

10.1*						Form of Restricted Stock Unit Agreement for Non-Employee Directors - Five Year Vesting

31.1						Certification of the Principal Executive Officer, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2						Certification of the Principal Financial Officer, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1						Certification of the Principal Executive Officer, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2						Certification of the Principal Financial Officer, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS						Inline XBRL Instance Document

101.SCH						Inline XBRL Taxonomy Extension Schema Document

101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.LAB						Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document

101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase Document

104						Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)

	⁽¹⁾	Filed as exhibit 3.1 to the Registration Statement on Form S-1 of the Company filed with the SEC on May 16, 2014 and incorporated herein by reference.
	⁽²⁾	Filed as exhibit 3.2 to the Registration Statement on Form S-4 of the Company filed with the SEC on October 10, 2017 and incorporated herein by reference.
	⁽³⁾	Filed as exhibit 4.1 to the Registration Statement on Form S-1 of the Company filed with the SEC on May 16, 2014 and incorporated herein by reference.
	⁽⁴⁾	Filed as exhibit 4.1 to the Current Report on Form 8-K filed with the SEC on April 7, 2022 and incorporated herein by reference.
	⁽⁵⁾	Filed as exhibit 4.2 to the Current Report on Form 8-K filed with the SEC on April 7, 2022 and incorporated herein by reference.

* Management contract or compensatory plan or arrangement.

The Company does not have any long-term debt instruments under which securities are authorized exceeding 10% of the total assets of the Company and its subsidiaries on a consolidated basis. The Company will furnish to the SEC, upon its request, a copy of all long-term debt instruments.

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

						INVESTAR HOLDING CORPORATION

Date: May 7, 2025						/s/ John J. D’Angelo
						John J. D’Angelo
						President and Chief Executive Officer
						(Principal Executive Officer)

Date: May 7, 2025						/s/ John R. Campbell
						John R. Campbell
						Chief Financial Officer
						(Principal Financial Officer)

TABLE OF CONTENTS

Part I. Financial Information Item 1. Financial Statements Note 1. Summary Of Significant Accounting Policies Note 2. Earnings Per Share Note 3. Investment Securities Note 4. Loans and Allowance For Credit Losses Note 5. Stockholders Equity Note 5. Stockholders Note 6. Derivative Financial Instruments Note 7. Fair Values Of Financial Instruments Note 8. Income Taxes Note 9. Commitments and Contingencies Note 10. Leases Item 2. Management S Discussion and Analysis Of Financial Condition and Results Of Operations Item 3. Quantitative and Qualitative Disclosures About Market Risk Item 4. Controls and Procedures Part II. Other Information Item 1A. Risk Factors Item 2. Unregistered Sales Of Equity Securities and Use Of Proceeds Item 6. Exhibits

Exhibits

3.1 Restated Articles of Incorporation of Investar Holding Corporation(1) 3.2 Amended and Restated By-laws of Investar Holding Corporation(2) 4.1 Specimen Common Stock Certificate(3) 4.2 Indenture, dated April 6, 2022, by and among Investar Holding Corporation and UMB Bank, National Association, as trustee(4) 4.3 Form of 5.125% Fixed-to-Floating Rate Subordinated Note due 2032(5) 10.1* Form of Restricted Stock Unit Agreement for Non-Employee Directors-Five Year Vesting 31.1 Certification of the Principal Executive Officer, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 31.2 Certification of the Principal Financial Officer, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 32.1 Certification of the Principal Executive Officer, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 32.2 Certification of the Principal Financial Officer, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

ISTR 10-Q Quarter ended March 31, 2025

Exhibits