What changed in this filing

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Item 1. Business

2025-02-27 compared with 2024-02-23 · 362 added, 372 removed, 429 unchanged (63% of the section changed)

Contents of Item 1.

MERGERS AND ACQUISITIONS

BANKING CENTER MARKETS

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First Busey Corporation’s common stock is traded on The Nasdaq Global Select Market under the symbol “BUSE.”

Subsidiaries of First Busey Corporation

Busey conducts the business of banking and provides related banking services, asset management, brokerage, and fiduciary services through Busey Bank, and provides payment technology solutions through FirsTech.

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Busey Bank has 50 banking centers in Illinois, eight in Missouri, three in southwest Florida, and one in Indianapolis, Indiana.

Busey Bank offers a range of diversified financial products and services for consumers and businesses, including online and mobile banking capabilities to conveniently serve our customers’ needs.

Commercial services include commercial, commercial real estate, real estate construction, and agricultural loans, as well as commercial depository services such as cash management.

Retail banking services include residential real estate, home equity lines of credit, consumer loans, customary types of demand and savings deposits, money transfers, safe deposit services, and individual retirement accounts and other fiduciary services through our banking center, automated teller machines, and technology-based networks.

Busey Bank offers a range of diversified financial products and services for consumers and businesses, including online and mobile banking capabilities to conveniently serve its customers’ needs.

Commercial services include commercial, CRE, real estate construction, and agricultural loans, as well as commercial depository services such as cash management.

Retail banking services include residential real estate, home equity lines of credit, consumer loans, customary types of demand and savings deposits, money transfers, safe deposit services, and individual retirement accounts and other fiduciary services through Busey Bank’s banking center, automated teller machines, and technology-based networks.

Busey Bank’s principal sources of income are interest and fees on loans and investments, wealth management fees, service fees, and payment technology solutions revenue.

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and central Indiana.

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Table of Contents Contents of Item 1.

Busey Bank provides a full range of asset management, investment, brokerage, fiduciary, philanthropic advisory, tax preparation, and farm management services to individuals, businesses, and foundations through its Wealth Management business.

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In addition, Busey Bank provides professional farm management and brokerage services to the agricultural industry.

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Table of Contents Contents of Item 1.

FirsTech, a wholly-owned subsidiary of Busey Bank, provides comprehensive and innovative payment technology solutions.

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FirsTech's client base represents a diverse set of industries, with a higher concentration in highly regulated industries, such as financial institutions, utility, insurance, and telecommunications industries.

First Busey Risk Management

First Busey Risk Management, previously a wholly-owned subsidiary of First Busey Corporation, incorporated in Nevada, was dissolved on December 18, 2023.

It was a captive insurance company that insured against certain risks unique to the operations of First Busey Corporation and its subsidiaries for which insurance may not have been available or economically feasible in the insurance marketplace.

First Busey Risk Management pooled resources with several other similar insurance company subsidiaries of financial institutions to spread a limited amount of risk among themselves.

Over the last several years, Busey completed the following acquisitions as part of our strategy to expand into new service areas and to provide broader coverage in areas where we already maintain a presence:

MERGERS AND ACQUISITIONS

Over the last several years, Busey completed the following acquisitions as part of its strategy to expand into new service areas and to provide broader coverage in areas where Busey already maintains a presence:

Acquisition Date Companies Acquired

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and its wholly-owned subsidiary, Glenview State Bank

Planned for 2024 Merchants and Manufacturers Bank Corporation, and its wholly-owned subsidiary, Merchants and Manufacturers Bank

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April 1, 2024 Merchants and Manufacturers Bank Corporation, and its wholly-owned subsidiary, Merchants and Manufacturers Bank

Planned for 2025 CrossFirst Bankshares, Inc., and its wholly-owned subsidiary CrossFirst Bank

Further information related to acquisitions made prior to January 1, 2024, has been presented in the Annual Reports previously filed with the SEC corresponding to each year of each acquisition.

Planned Partnership with CrossFirst

On August 26, 2024, Busey and CrossFirst entered into an agreement and plan of merger (the “merger agreement”) pursuant to which CrossFirst will merge with and into Busey (the “merger”) and CrossFirst’s wholly-owned subsidiary, CrossFirst Bank, will merge with and into Busey Bank (the “bank merger”).

The combined holding company will continue to operate under the First Busey Corporation name and the combined bank will operate under the Busey Bank name.

This partnership will create a premier commercial bank in the Midwest, Southwest, and Florida, with 77 full-service locations across 10 states—Arizona, Colorado, Florida, Illinois, Indiana, Kansas, Missouri, New Mexico, Oklahoma, and Texas—and approximately $20 billion in combined assets, $17 billion in total deposits, $14 billion in total loans, and $14 billion in wealth assets under care.

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Table of Contents Contents of Item 1.

Further information related to completed acquisitions has been presented in the Annual Reports previously filed with the SEC corresponding to the year of each acquisition.

Acquisition of Merchants and Manufacturers Bank Corporation Planned for The Second Quarter of 2024

On November 27, 2023, First Busey Corporation announced the signing of a definitive agreement with M&M, pursuant to which Busey will acquire M&M and its wholly-owned subsidiary, M&M Bank, through a merger transaction.

This partnership will add M&M’s Life Equity Loan ® products to Busey’s existing suite of services, and expand Busey’s presence in the Chicago Metropolitan Statistical Area.

Under the terms of the merger agreement, M&M’s stockholders will have the right to receive for each share of M&M common stock, at the election of each stockholder and subject to proration and adjustment, either (1) $117.74 in cash, (2) 5.7294 shares of Busey common stock, or (3) mixed consideration of $34.55 in cash and 4.0481 shares of Busey common stock, with total consideration to consist of approximately 71% stock and 29% cash.

Based upon Busey’s 20‑day volume-weighted average closing price as of November 24, 2023, the aggregate implied transaction value is approximately $41.6 million.

The merger is expected to be finalized in the second quarter of 2024, subject to customary closing conditions and required approvals, including regulatory approvals and the approval of M&M’s stockholders.

It is anticipated that M&M Bank will be merged with and into Busey Bank at a date following the completion of the merger.

At the time of the bank merger, M&M Bank’s banking centers will become banking centers of Busey Bank, except for M&M’s banking center located at 990 Essington Rd., Joliet, Illinois, which is expected to be closed in connection with the bank merger.

See “ Note 23.

Acquisitions ” in the Notes to the Consolidated Financial Statements for further information relating to this acquisition.

Under the terms of the merger agreement, CrossFirst stockholders will have the right to receive for each share of CrossFirst common stock 0.6675 of a share of Busey’s common stock.

Upon completion of the transaction, Busey’s stockholders will own approximately 63.5% of the combined company and CrossFirst’s stockholders will own approximately 36.5% of the combined company, on a fully-diluted basis.

Busey common stock will continue to trade on the Nasdaq under the “BUSE” stock ticker symbol.

On December 20, 2024, Busey and CrossFirst stockholders voted to approve the merger.

On January 16, 2025, Busey received regulatory approval from the Board of Governors of the Federal Reserve System for the merger.

The transaction has also been approved by the Illinois Department of Financial and Professional Regulation and the Kansas Office of the State Bank Commissioner.

Busey and CrossFirst intend to close the merger on March 1, 2025, subject to the satisfaction of the remaining customary closing conditions.

It is anticipated that CrossFirst Bank will merge with and into Busey Bank in mid-2025.

At the time of the bank merger, CrossFirst Bank locations will become banking centers of Busey Bank.

In connection with the merger, Busey incurred one-time pretax acquisition-related expenses of $3.9 million in 2024.

For further details on the merger, see Busey’s Current Report on Form 8‑K announcing the merger, which was filed with the SEC on August 27, 2024.

2024 Acquisition of Merchants and Manufacturers Bank Corporation

On April 1, 2024, Busey completed its acquisition of M&M and its wholly-owned subsidiary, M&M Bank, through a merger transaction.

This partnership added M&M’s Life Equity Loan ® products to Busey’s existing suite of services and expanded Busey’s presence in the suburban Chicago market.

M&M’s results of operations were included in Busey’s results of operation beginning April 1, 2024.

For further information regarding these acquisitions, see “ Note 2.

Mergers and Acquisitions ” in the Notes to the Consolidated Financial Statements.

BANKING CENTER MARKETS

Busey Bank serves the Illinois banking market with 50 banking centers.

Our Illinois markets feature several Fortune 1000 companies.

Those organizations, coupled with large healthcare and higher education sectors, anchor the communities in which they are located and have provided a comparatively stable foundation for housing, employment, and small business.

Ten of our banking centers in Illinois are located within the Chicago Metropolitan Statistical Area, and 12 of our banking centers in Illinois are located within the St.

Seventeen of Busey’s Illinois banking centers are positioned to serve the suburban Chicago market, 21 banking centers serve central Illinois markets, and 12 banking centers in Illinois are located within the St.

Louis Metropolitan Statistical Area.

Busey’s Illinois markets feature several Fortune 1000 companies.

Busey Bank has eight banking centers in Missouri.

Louis, Missouri has a diverse economy with major employment sectors including health care, financial services, professional and business services, and retail.

We have a total of 20 banking centers within the boundaries of the St.

Busey has a total of 20 banking centers within the boundaries of the St.

Louis Metropolitan Statistical Area, including branches in both Illinois and Missouri.

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Busey Bank has one banking center in the Indianapolis, Indiana area, which is the most populous city of Indiana with a diverse economy, particularly because it serves as the headquarters of many large corporations.

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Table of Contents Contents of Item 1.

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Market Share Ranking

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Table of Contents Contents of Item 1.

HUMAN CAPITAL

Busey is built upon a strong commitment to associate, customer, stockholder, and community experiences with our associates as the cornerstone of this unwavering commitment.

Busey’s vision, Service Excellence in Everything We Do, starts with dedication to our associates.

We are deeply humbled to be consistently recognized nationally and locally throughout our footprint, including being named among America’s Best Banks by Forbes and the Best Banks to Work For by American Banker since 2016;

the Best Places to Work in Money Management by Pension and Investments since 2018;

and a Leading Disability Employer by the National Organization on Disability.

Locally, Busey has been voted as a Best Places to Work in Illinois since 2016 and a Best Company to Work For in Florida since 2017.

From exceeding the needs of customers and colleagues to serving our communities selflessly, our associates show unmatched dedication to Busey.

Busey is built upon a strong commitment to associate, customer, stockholder, and community, with its associates as the cornerstone of this unwavering commitment.

Busey’s vision, Service Excellence in Everything We Do, starts with Busey’s dedication to its associates.

Busey is deeply humbled to be consistently recognized nationally and locally throughout the Company’s footprint, including being named nationally among the World’s Best Banks and America’s Best Banks by Forbes;

the Best Banks to Work For by American Banker ;

and the Best Places to Work in Money Management by Pension and Investments.

Locally, Busey was once again voted among the Best Places to Work in Illinois and a Best Company to Work For in Florida.

From exceeding the needs of customers and colleagues to serving their communities selflessly, Busey associates show unmatched dedication to the Company.

Their shared experiences are what make these and other awards possible.

Since we opened our doors over 155 years ago, we have maintained our core values, creating a strong foundation and shaping our inclusive culture.

Busey remains committed to bringing diversity and inclusion to our organization, the banking profession, and the communities where we live and work.

Since Busey opened its doors 157 years ago, Busey has maintained its core values, creating a strong foundation and shaping its inclusive culture.

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Table of Contents Contents of Item 1.

Busey remains committed to fostering a welcoming and supportive environment within its organization, the banking profession, and the communities in which it operates.

Busey is dedicated to attracting and retaining talent across a variety of backgrounds and experiences.

A diverse team—one with varying beliefs and opinions—promotes productivity, creativity, and innovation, while better meeting and exceeding the needs of a diverse customer base.

Recruiting, supporting, and retaining a diversified workforce with varying perspectives and ideas, while having an inclusive culture, is the foundation of our core values—One Busey.

Our endeavors in this regard are reported to the Employee Benefit and Compensation Committee, as well as the Board's Enterprise Risk Committee, which hold the organization accountable to this core value at the highest levels of management.

We maintain an Affirmative Action Plan, the results of which are reviewed by these same groups.

Busey supports and empowers women in the workplace as reflected in our gender-diverse workforce.

In 2023, women comprised 59% of Busey's total number of associates, and made up 37% of our senior leadership, providing meaningful contributions not only within the organization but throughout the communities we serve.

Associate engagement is an important barometer of our cultural health.

We regularly solicit feedback to understand the views of our associates about their work environment and Busey’s culture.

Teams with varying beliefs and opinions promote productivity, creativity, and innovation, while better meeting and exceeding the needs of Busey’s customer base.

Recruiting, supporting, and retaining a workforce with varying perspectives and ideas, while maintaining a welcoming culture, is the foundation of Busey’s core values—One Busey.

Busey’s endeavors in this regard are reported to the Employee Benefit and Compensation Committee and to the Board's Enterprise Risk Committee, which hold the organization accountable to this core value at the highest levels of management.

Associate engagement is an important barometer of Busey’s cultural health.

Busey regularly solicits feedback to understand the views of its associates about their work environment and Busey’s culture.

The results from engagement surveys are used to implement programs and processes designed to enhance engagement and improve the associate experience.

With a strong 91% participation rate and an approach focused on continuous improvement, 2024 results increased to the highest scores in Busey’s history.

One such way to keep associates informed and engaged is through our quarterly update calls, which are conducted by Busey leadership.

These calls provide important information about the financial health of the Company, but more importantly they provide a cultural touchpoint to solidify Busey’s commitment to our number one asset – our associates.

A tenet of our engaged culture is a commitment to investing in associates through unique, award-winning training and development programs.

In 2023, 55% of our associate base engaged in talent and leadership development programs.

One such way to keep associates informed and engaged is through quarterly update calls, which are conducted by Busey leadership.

A tenet of Busey’s engaged culture is a commitment to investing in associates through unique, award-winning training and development programs.

In 2024, 59% of Busey’s associate base engaged in talent and leadership development programs.

Since 2017, Busey has been a proud recipient of the Association for Talent Development’s BEST Award, which is presented to organizations that demonstrate enterprise-wide success as a result of employee talent development.

Additionally, we care about the health and well-being of our associates and their families, as evidenced by a strong investment and a 96% participation rate in our innovative, holistic health and wellness program, B Well.

Additionally, Busey cares about the health and well-being of its associates and their families, as evidenced by a strong investment and an 85% participation rate in Busey’s innovative, holistic health and wellness program, B Well.

Investments in B Well include a stress management and mental wellness component, lifesaving biometric screenings, a corporate health and wellness coach, onsite wellness center, health club reimbursements, on-demand wellness streaming service and Health Savings Account investments funded by the Company.

In 2023, Busey was honored to be recognized among the 2022 Illinois' Healthiest Employers by global health insurer Cigna and Crain’s Content Studio, marking the fifth year the Company was named among this elite group.

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Table of Contents Contents of Item 1.

As of December 31, 2023, Busey and our subsidiaries had a total of 1,479 full-time equivalents.

Geographic distribution of our associates is as follows:

In 2024, Busey was honored to be recognized among the Illinois' Healthiest Employers by global health insurer Cigna and Crain’s Content Studio, marking the seventh year the Company was named among this elite group.

As of December 31, 2024, Busey and its subsidiaries had a total of 1,509 full-time equivalents.

Geographic distribution of Busey associates is as follows:

As of December 31, 2024

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Indiana 28 1 29

Remote 42 1 43

Total number of associates 1,468 80 1,548

Full-time equivalents 1,468 41 1,509

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Table of Contents Contents of Item 1.

CORPORATE GOVERNANCE

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Additionally, a listing of Busey’s executive officers is presented in Part III, Item 10 of this Form 10‑K under the caption “ Executive Officers .”

Busey has adopted a code of ethics applicable for all of our associates, officers, and directors.

Busey has adopted a code of ethics applicable to all Busey associates, officers, and directors.

The text of this code of ethics is presented under “Governance Documents” on Busey’s Investor Relations website at ir.busey.com .

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FDIC-insured institutions, like Busey Bank, as well as their holding companies and affiliates, are extensively regulated under federal and state law.

As a result, Busey’s growth and earnings performance may be affected not only by management decisions, competitive dynamics, and general economic conditions, but also by the requirements of federal and state statutes and by the regulations and policies of various bank regulatory agencies, including the DFPR, the Federal Reserve, the FDIC and the CFPB.

Furthermore, taxation laws administered by the Internal Revenue Service and state taxing authorities, accounting rules developed by the FASB, securities laws administered by the SEC and state securities authorities, and anti-money laundering laws enforced by the U.S.

As a result, Busey’s growth and earnings performance may be affected not only by management decisions, competitive dynamics, and general economic conditions, but also by the requirements of federal and state statutes and by the regulations and policies of various banking agencies, including the DFPR, the Federal Reserve, the FDIC and the CFPB.

Treasury have an impact on Busey’s business.

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Federal and state banking laws impose a comprehensive system of supervision, regulation, and enforcement on the operations of FDIC-insured institutions, their holding companies, and affiliates that is intended primarily for the protection of the FDIC-insured deposits and depositors of banks, rather than stockholders.

These laws, and the regulations of the bank regulatory agencies issued under them, affect, among other things, the scope of Busey’s business;

the kinds and amounts of investments First Busey and Busey Bank may make;

These laws, and the regulations of the banking agencies issued under them, affect, among other things, the scope of Busey’s business;

the kinds and amounts of investments that Busey and Busey Bank may make;

required capital levels relative to assets;

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the establishment of branches;

the ability to merge, consolidate and acquire;

dealings with First Busey’s and Busey Bank’s insiders and affiliates;

the ability of Busey and Busey Bank to merge, consolidate and acquire;

dealings with Busey’s and Busey Bank’s insiders and affiliates;

and Busey’s payment of dividends.

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Table of Contents Contents of Item 1.

In reaction to the global financial crisis and particularly following the passage of the Dodd-Frank Act in 2010, Busey experienced heightened regulatory requirements and scrutiny.

Although the reforms primarily targeted systemically important financial service providers (at the time, those with assets of $50 billion and greater), certain provisions of the law triggered at $10 billion in assets and the influence of other provisions filtered down in varying degrees to community banks over time, causing Busey’s compliance and risk management processes, and the costs thereof, to increase.

Although the reforms primarily targeted large banking organizations and systemically important financial institutions (at the time, those with assets of $50 billion and greater), certain provisions of the law triggered at $10 billion in assets and the influence of other provisions filtered down in varying degrees to community banks over time, causing Busey’s compliance and risk management processes, and the costs thereof, to increase.

The Regulatory Relief Act provided meaningful relief for banks and their holding companies that were not considered systemically important (amended to be those with assets under $250 billion).

However, the $10 billion threshold remained in place for certain Dodd-Frank Act reforms that are applicable to Busey, as discussed below.

It is anticipated that the current presidential administration and the current U.S.

Congress likely will not increase the regulatory burden on banking organizations.

At this time, however, it is not possible to predict with any certainty the actual impact that the current political climate may have on the banking industry or the operations of Busey or Busey Bank.

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Table of Contents Contents of Item 1.

The supervisory framework for U.S.

banking organizations subjects banks and bank holding companies to regular examination by their respective regulatory agencies, which results in examination reports and ratings that are not publicly available and that can impact the conduct and growth of their businesses.

banking organizations subjects banks and bank holding companies to regular examination by their respective banking agencies, which results in examination reports and ratings that are not publicly available and that can impact the conduct and growth of their businesses.

These examinations consider not only compliance with applicable laws and regulations, but also capital levels, asset quality and risk, management ability and performance, earnings, liquidity, and various other factors.

The regulatory agencies generally have broad discretion to impose restrictions and limitations on the operations of a regulated entity where the agencies determine, among other things, that such operations are unsafe or unsound, fail to comply with applicable law, or are otherwise inconsistent with laws and regulations.

The approach to supervision adopted by each banking agency may have significant impacts on the operations and results of Busey and Busey Bank, as well as the banking industry in general.

Based on statements made by congressional leaders and the acting leaders of certain federal banking agencies, there may be changes in the supervisory processes and approach made by the banking agencies, but it is not possible at this time to predict the specific changes (or the timing of any such changes) that may be made.

The following is a summary of the material elements of the supervisory and regulatory framework applicable to First Busey and Busey Bank.

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The $10 billion Threshold

As indicated in the introduction above, the Dodd-Frank Act included a number of requirements that triggered when a banking entity crossed over $10 billion in assets.

As indicated above, the Dodd-Frank Act included a number of requirements that were triggered when a banking entity crossed over $10 billion in assets.

Those included requirements for stress testing capital, maintenance of a risk committee, adherence to the Volcker Rule’s complicated prohibitions on proprietary trading and ownership of private funds, limitations on interchange fees for certain debit transactions, clearing of swap agreements, and examination and enforcement related to consumer financial services by the CFPB, in addition to a number of heightened reporting requirements.

The Regulatory Relief Act eliminated the stress test and risk committee requirements for banking entities between $10 billion and $50 billion, but the other Dodd-Frank regulations and reporting requirements were not changed.

The Regulatory Relief Act eliminated the stress test and risk committee requirements for banking entities between $10 billion and $50 billion, but the other regulations and reporting requirements under the Dodd-Frank Act were not changed.

Busey crossed the $10 billion threshold in 2020.

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Interchange fees, also known as “swipe” fees, are charges that merchants pay to card-issuing banks, such as Busey Bank, for processing electronic payment transactions.

The Federal Reserve set the maximum interchange fee at 21 cents, plus five basis points of the transaction value.

The Federal Reserve set the maximum interchange fee at 21 cents, plus five bps of the transaction value.

The Federal Reserve also adopted a rule to allow a debit card issuer to recover one cent per transaction for fraud prevention purposes if the issuer complies with certain fraud-related requirements required by the Federal Reserve.

Fee limits imposed by the Durbin Amendment are applicable to any banking entity with over $10 billion in assets and became applicable to Busey Bank on July 1, 2022, following a six-month transition period.

Fee limits imposed by the Durbin Amendment are applicable to any banking organization with over $10 billion in assets and became applicable to Busey Bank on July 1, 2022, following a six-month transition period.

Compliance with the Durbin Amendment has reduced Busey Bank’s earnings on the covered debit transactions.

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Table of Contents Contents of Item 1.

The Volcker Rule (also a part of the Dodd-Frank Act) restricts the ability of banking entities (holding companies and their affiliates) with over $10 billion in assets to sponsor or invest in private funds, or to engage in certain types of proprietary trading.

In October 2019, the Federal Reserve, OCC, FDIC, Commodity Futures Trading Commission, and SEC finalized rules to tailor the application of the Volcker Rule based on the size and scope of a banking entity’s trading activities and to clarify and amend certain definitions, requirements, and exemptions.

Banking entities have two years (with a possibility of extensions) to comply with the Volcker requirements after crossing the $10 billion threshold.

The Volcker Rule (also a part of the Dodd-Frank Act) restricts the ability of banking organizations (holding companies and their affiliates) with over $10 billion in assets to sponsor or invest in private funds, or to engage in certain types of proprietary trading.

In October 2019, the Federal Reserve, OCC, FDIC, Commodity Futures Trading Commission, and SEC finalized rules to tailor the application of the Volcker Rule based on the size and scope of a banking organization’s trading activities and to clarify and amend certain definitions, requirements, and exemptions.

Banking organizations have two years (with a possibility of extensions) to comply with the Volcker requirements after crossing the $10 billion threshold.

Busey does not materially engage in the activities prohibited by the Volcker Rule;

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Although most of the CFPB’s rules issued under federal consumer financial protection laws are applicable to all providers of consumer financial services, the CFPB only has examination and enforcement authority over banks with more than $10 billion in assets (measured over four consecutive quarters).

Busey Bank is under CFPB oversight for consumer banking transactions, and continues to be examined for compliance with consumer laws by its primary federal regulatory agency, the FDIC.

Busey Bank is under CFPB oversight for consumer banking transactions and continues to be examined for compliance with consumer laws by its primary federal regulator, the Federal Reserve.

Clearing Swaps Agreements

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Regulatory capital represents the net assets of a banking organization available to absorb losses.

Because of the risks attendant to their business, FDIC-insured institutions generally are required to hold more capital than other businesses.

These requirements directly affects Busey’s earnings capabilities.

Although capital historically has been one of the key measures of the financial health of both bank holding companies and banks, its role became fundamentally more important in the wake of the global financial crisis, as the banking regulators recognized that the amount and quality of capital held by banks prior to the crisis was insufficient to absorb losses during periods of severe stress.

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Because of the risks attendant to their business, FDIC-insured institutions, such as Busey Bank, as well as their holding companies (i.e., banking organizations), generally are required to hold more capital than other businesses.

These requirements directly affect Busey’s earnings capabilities.

Although capital historically has been one of the key measures of the financial health of both bank holding companies and banks, its role became fundamentally more important in the wake of the global financial crisis, as the banking regulators recognized that the amount and quality of capital held by banking organizations prior to that crisis was insufficient to absorb losses during periods of severe stress.

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Table of Contents Contents of Item 1.

Capital Levels

Banks have been required to hold minimum levels of capital based on guidelines established by the bank regulatory agencies since 1983.

The minimums have been expressed in terms of ratios of “capital” divided by “total assets.” Beginning in 1989, capital guidelines for U.S.

banks have been based upon international capital accords, known as “Basel” rules, adopted by the Basel Committee on Banking Supervision, a committee of central banks and bank supervisors that acts as the primary global standard-setter for prudential regulation, as implemented by the U.S.

bank regulatory agencies on an interagency basis.

The accords recognized that bank assets for the purpose of the capital ratio calculations needed to be risk weighted (the theory being that riskier assets should require more capital) and that off-balance sheet exposures needed to be factored into the calculations.

Following the global financial crisis, the Group of Governors and Heads of Supervision, the oversight body of the Basel Committee on Banking Supervision, announced agreement on a strengthened set of capital requirements for banking organizations around the world, known as Basel III, to address deficiencies recognized in connection with the global financial crisis.

Banking organizations have been required to hold minimum levels of capital based on guidelines established by the banking agencies since 1983.

The minimum capital levels for banking organizations have been expressed in terms of ratios of “capital” divided by “total assets.” Beginning in 1989, capital guidelines for U.S.

banking organizations have been based upon international capital accords, known as “Basel” accords, adopted by the Basel Committee on Banking Supervision, a committee of central banks and bank supervisors that acts as the primary global standard-setter for prudential regulation, as implemented by the U.S.

federal banking agencies on an interagency basis.

These accords recognized that bank assets for the purpose of the capital ratio calculations needed to be risk weighted (the theory being that riskier assets should require more capital) and that off-balance sheet exposures needed to be factored into the calculations.

Following the global financial crisis, the Group of Governors and Heads of Supervision, the oversight body of the Basel Committee on Banking Supervision, announced an agreement on a strengthened set of capital requirements for banking organizations around the world, known as the Basel III accords, to address deficiencies recognized in connection with the global financial crisis.

The Basel III Rule

federal banking agencies adopted the Basel III Rule in regulations that were effective (with a number of phase-ins) in 2015.

The Basel III Rule established capital standards for banks and bank holding companies that are meaningfully more stringent than those in place previously.

The Basel III Rule is applicable to all banking organizations that are subject to minimum capital requirements, including federal and state banks and savings and loan associations, as well as to most bank and savings and loan holding companies.

The Basel III Rule established capital standards for banks and bank holding companies that are meaningfully more stringent than those established previously and are still in effect today.

The Basel III Rule is applicable to all banking organizations that are subject to minimum capital requirements, including national banks, state banks, and savings and loan associations, as well as to most bank and savings and loan holding companies.

First Busey and Busey Bank are each subject to the Basel III Rule as described below.

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Basel III required a more complex, detailed and calibrated assessment of risk in the calculation of risk weightings.

Although it uses the same technique introduced by Basel I in assigning assets to risk-weight categories, it significantly increases the categories and adds conditions.

Risk weights were established as high as 250% for certain commercial real estate exposures, and higher for certain derivatives.

The assignment of risk weights continues to be under review by the banking agencies and has culminated in an initiative called “Basel III:

Endgame,” which, as proposed, would only apply to banks with $100 billion in assets or more and would not impact Busey.

Although it uses the same technique introduced by the Basel I accord in assigning assets to risk-weight categories, it significantly increases the number of categories and adds conditions to the assignment of certain risk weights.

Risk weights were established as high as 250% for certain CRE exposures, and higher for certain derivatives.

The assignment of risk weights is likely to continue to be under review by federal banking agencies as they seek to implement certain remaining elements of Basel III.

In July 2023, the Biden Administration banking agencies had proposed wide-ranging and significant changes to the Basel III Rules (the “Basel III Endgame Proposal”), which would have, among other requirements, imposed structural changes to the calculation of capital requirements and risk-weighted assets.

The Basel III Endgame Proposal would generally have impacted the capital requirements applicable to banking organizations with $100 billion or more in total assets and, as a general matter, would not impact Busey.

The Basel III Endgame Proposal has not been, and is not expected to be, adopted in a form substantially similar to the Basel III Endgame Proposal.

The banking agencies may issue their own version of this proposal.

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Table of Contents Contents of Item 1.

Minimum Capital Ratio Requirements

Basel III also increased the required quantity and quality of capital.

The Basel III Rule also increased the required quantity and quality of capital.

Not only did it increase most of the required minimum capital ratios in effect prior to January 1, 2015, but in requiring that forms of capital be of higher quality to absorb loss, it also introduced the concept of Common Equity Tier 1 Capital, which consists primarily of common stock, related surplus (net of Treasury stock), retained earnings, and Common Equity Tier 1 minority interests subject to certain regulatory adjustments.

The Basel III Rule also changed the definition of capital by establishing more stringent criteria that instruments must meet to be considered Additional Tier 1 Capital (primarily non-cumulative perpetual preferred stock that meets certain requirements) and Tier 2 Capital (primarily other types of preferred stock and subordinated debt, subject to limitations).

The Basel III Rule also constrained the inclusion of minority interests, mortgage-servicing assets, and deferred tax assets in capital and required deductions from Common Equity Tier 1 Capital if such assets exceeded a percentage of a banking institution’s Common Equity Tier 1 Capital.

The Basel III Rule requires minimum capital ratios as follows:

The Basel III Rule requires banking organizations to maintain minimum capital ratios as follows:

• A ratio of Common Equity Tier 1 Capital equal to 4.5% of risk-weighted assets;

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Table of Contents Contents of Item 1.

• A ratio of Tier 1 Capital equal to 6% of risk-weighted assets;

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Capital Conservation Buffer

In addition, institutions that want to make capital distributions (including for dividends and repurchases of stock) and pay discretionary bonuses to executive officers without restriction also must maintain 2.5% in Common Equity Tier 1 Capital attributable to a capital conservation buffer.

In addition, banking organizations that want to make capital distributions (including for dividends and repurchases of stock) and pay discretionary bonuses to executive officers without restriction also must maintain 2.5% in Common Equity Tier 1 Capital attributable to a capital conservation buffer.

The purpose of the conservation buffer is to ensure that banking institutions maintain a buffer of capital that can be used to absorb losses during periods of financial and economic stress.

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Well-Capitalized Requirements

The ratios described above are minimum standards for banking organizations to be considered “adequately capitalized.” Bank regulatory agencies uniformly encourage banks to hold more capital and be “well-capitalized” and, to that end, federal law and regulations provide various incentives for banking organizations to maintain regulatory capital at levels in excess of minimum regulatory requirements.

The ratios described above are minimum standards for banking organizations to be considered “adequately capitalized.” Banking agencies uniformly encourage banking organizations to hold more capital and be “well-capitalized” and, to that end, federal law and regulations provide various incentives for banking organizations to maintain regulatory capital at levels in excess of minimum regulatory requirements.

For example, a banking organization that is well-capitalized may:

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Higher capital levels also could be required if warranted by the particular circumstances or risk profiles of individual banking organizations.

For example, the Federal Reserve’s capital guidelines contemplate that additional capital may be required to take adequate account of, among other things, interest rate risk, the risks posed by concentrations of credit, nontraditional activities, or securities trading activities.

For example, the Federal Reserve’s capital guidelines contemplate that additional capital may be required to take adequate account of, among other things, interest rate risk or the risks posed by concentrations of credit, nontraditional activities, or securities trading activities.

Further, any banking organization experiencing or anticipating significant growth would be expected to maintain capital ratios, including tangible capital positions ( i.e.

, Tier 1 Capital less all intangible assets), well above the minimum levels.

Under the capital regulations of the FDIC and Federal Reserve, in order to be well-capitalized, a banking organization must maintain all of the following:

Under the capital regulations of the Federal Reserve, in order to be well-capitalized, a banking organization must maintain all of the following:

• A Common Equity Tier 1 Capital ratio to risk-weighted assets of 6.5% or more;

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Table of Contents Contents of Item 1.

• A ratio of Tier 1 Capital to total risk-weighted assets of 8% or more;

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As of December 31, 2024:

(1) Busey Bank was not subject to a directive from the FDIC to increase its capital, and (2) Busey Bank was well-capitalized, as defined by FDIC regulations.

As of December 31, 2023, First Busey had regulatory capital in excess of the Federal Reserve’s requirements and met the requirements to be well-capitalized.

(1) Busey Bank was not subject to a directive from the Federal Reserve or the DFPR to increase its capital, and (2) Busey Bank was well-capitalized, as defined by Federal Reserve regulations.

As of December 31, 2024, Busey had regulatory capital in excess of the Federal Reserve’s requirements and met the Basel III Rule requirements to be well-capitalized.

First Busey also is in compliance with the capital conservation buffer.

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Table of Contents Contents of Item 1.

Prompt Corrective Action

The concept of an institution being “well-capitalized” is part of a regulatory enforcement regime that provides the federal banking regulators with broad power to take “prompt corrective action” to resolve the problems of depository institutions based on the capital level of each particular institution.

The extent of the regulators’ powers depends on whether the institution in question is “adequately capitalized,” “undercapitalized,” “significantly undercapitalized” or “critically undercapitalized,” in each case as defined by regulation.

Depending upon the capital category to which an institution is assigned, the regulators’ corrective powers include:

The concept of a banking organization being “well-capitalized” is part of a regulatory enforcement regime that provides the federal banking agencies with broad power to take “prompt corrective action” to resolve the problems of depository institutions based on the capital level of each particular institution.

The extent of the regulators’ powers depends on whether the banking organization in question is “adequately capitalized,” “undercapitalized,” “significantly undercapitalized” or “critically undercapitalized,” in each case as defined by regulation.

Depending upon the capital category to which a banking organization is assigned, the banking agencies’ corrective powers include:

(1) requiring the institution to submit a capital restoration plan;

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As a bank holding company, First Busey Corporation is registered with, and subject to regulation, supervision, and enforcement by, the Federal Reserve under the BHCA.

First Busey Corporation is legally obligated to act as a source of financial and managerial strength to Busey Bank and to commit resources to support it in circumstances where we might not otherwise do so.

First Busey Corporation is legally obligated to act as a source of financial and managerial strength to Busey Bank and to commit resources to support it in circumstances where First Busey Corporation might not otherwise do so.

Under the BHCA, First Busey Corporation is subject to periodic examination by the Federal Reserve and is required to file with the Federal Reserve periodic reports of its operations and such additional information regarding First Busey Corporation and Busey Bank as the Federal Reserve may require.

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Acquisitions, Activities and Financial Holding Company Election

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The BHCA generally requires the prior approval of the Federal Reserve for any merger involving a bank holding company or any acquisition by a bank holding company of another bank or bank holding company.

Subject to certain conditions (including deposit concentration limits established by the BHCA), the Federal Reserve may allow a bank holding company to acquire banks located in any state of the U.S.

Subject to certain conditions (including deposit concentration limits established by the BHCA), the Federal Reserve may allow a bank holding company to acquire banks located in any state of the United States.

In approving interstate acquisitions, the Federal Reserve is required to give effect to applicable state law limitations on the aggregate amount of deposits that may be held by the acquiring bank holding company and its FDIC-insured institution affiliates in the state in which the target bank is located (provided that those limits do not discriminate against out-of-state institutions or their holding companies) and state laws that require that the target bank have been in existence for a minimum period of time (not to exceed five years) before being acquired by an out-of-state bank holding company.

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Business—Supervision, Regulation and Other Factors—The Role of Capital ” above.

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Table of Contents Contents of Item 1.

The BHCA generally prohibits bank holding companies from acquiring direct or indirect ownership or control of more than 5% of the voting shares of any company that is not a bank and from engaging in any business other than that of banking, managing, and controlling banks, or furnishing services to banks and their subsidiaries.

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In order to maintain its status as a financial holding company, First Busey and Busey Bank must be well-capitalized, well-managed, and Busey Bank must have a least a satisfactory CRA rating.

If the Federal Reserve determines that a financial holding company is not well-capitalized or well-managed, the company has a period of time in which to achieve compliance, but during the period of noncompliance, the Federal Reserve may place any limitations on the company it believes to be appropriate.

Furthermore, if the Federal Reserve determines that a financial holding company’s subsidiary bank has not received a satisfactory CRA rating, that company will not be able to commence any new financial activities or acquire a company that engages in such activities.

If the Federal Reserve determines that a financial holding company is not well-capitalized or well-managed, the Federal Reserve will provide a period of time in which to re-achieve compliance with those requirements, but during the period of noncompliance the Federal Reserve may place any limitations on the financial holding company that it deems appropriate.

Furthermore, if the Federal Reserve determines that a financial holding company’s subsidiary bank has not received a satisfactory CRA rating, that financial holding company will not be able to commence any new financial activities or acquire a company that engages in such activities.

Change in Control

Federal law also prohibits any person or company from acquiring “control” of an FDIC-insured depository institution or its holding company without prior notice to the appropriate federal bank regulator.

“Control” is conclusively presumed to exist upon the acquisition of 25% or more of the outstanding voting securities of a bank or bank holding company but may arise under certain circumstances between 10% and 24.99% ownership.

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Capital Requirements

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Dividend Payments

First Busey Corporation's ability to pay dividends to its stockholders may be affected by both general corporate law considerations and the policies of the Federal Reserve applicable to bank holding companies.

First Busey Corporation's ability to pay dividends to its stockholders may be affected by both general corporate law considerations and the policies and capital requirements of the Federal Reserve applicable to bank holding companies.

As a Nevada corporation, First Busey Corporation is subject to the limitations of Nevada law, which allows First Busey Corporation to pay dividends unless, after such dividend, (1) First Busey Corporation would not be able to pay its debts as they become due in the usual course of business or (2) First Busey Corporation’s total assets would be less than the sum of its total liabilities plus any amount that would be needed, if First Busey Corporation were to be dissolved at the time of the dividend payment, to satisfy the preferential rights upon dissolution of stockholders whose rights are superior to the rights of the stockholders receiving the distribution.

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As a general matter, the Federal Reserve has indicated that the board of directors of a bank holding company should eliminate, defer, or significantly reduce dividends to stockholders if:

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Among these powers is the ability to proscribe the payment of dividends by banks and bank holding companies.

In addition, under the Basel III Rule, institutions that seek the freedom to pay dividends have to maintain 2.5% in Common Equity Tier 1 Capital attributable to the capital conservation buffer.

In addition, under the Basel III Rule, banking organizations that want to pay unrestricted dividends must maintain 2.5% in Common Equity Tier 1 Capital attributable to the capital conservation buffer.

See “ Item 1.

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Incentive Compensation

There have been a number of developments in recent years focused on incentive compensation plans sponsored by bank holding companies and banks, reflecting recognition by the bank regulatory agencies and Congress that flawed incentive compensation practices in the financial industry were one of many factors contributing to the global financial crisis.

The result is interagency guidance on sound incentive compensation practices.

There have been a number of developments in recent years focused on incentive compensation plans sponsored by bank holding companies and their subsidiary banks, reflecting recognition by federal banking agencies and U.S.

Congress that flawed incentive compensation practices in the financial industry were one of many factors contributing to the global financial crisis.

The result is interagency guidance on sound incentive compensation practices for banking organizations.

The interagency guidance recognized three core principles.

Effective incentive plans should:

(1) provide employees incentives that appropriately balance risk and reward;

(1) provide employees with incentives that appropriately balance risk and reward;

(2) be compatible with effective controls and risk-management;

and (3) be supported by strong corporate governance, including active and effective oversight by the organization’s board of directors.

Much of the guidance addresses large banking organizations and, because of the size and complexity of their operations, the regulators expect those organizations to maintain systematic and formalized policies, procedures, and systems for ensuring that the incentive compensation arrangements for all executive and non-executive employees covered by this guidance are identified and reviewed, and appropriately balance risks and rewards.

Smaller banking organizations, like First Busey, that use incentive compensation arrangements are expected to be less extensive, formalized, and detailed than those of the larger banks.

Much of the guidance is directed at large banking organizations and, because of the size and complexity of their operations, the regulators expect those organizations to maintain systematic and formalized policies, procedures, and systems for ensuring that the incentive compensation arrangements for all executive and non-executive employees covered by this guidance are identified and reviewed, and appropriately balance risks and rewards.

Under the interagency guidance, smaller banking organizations, like Busey, that use incentive compensation arrangements are expected to implement less extensive, formalized, and detailed policies, procedures, and systems than those of larger banks.

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In May 2024, certain of the federal banking and other financial services agencies released a proposed rule regarding certain incentive-based compensation arrangements at certain financial institutions with at least $1 billion in assets, as required under Section 956 of the Dodd-Frank Act.

This proposal was largely based on an earlier 2016 proposal.

The Federal Reserve and the SEC, however, did not join this proposal, signaling potential interagency misalignment and raising doubts regarding the likelihood of the proposed rule being finalized in its current form.

The FDIC has indicated that the agencies will continue to coordinate to reach consensus, but it is not yet clear whether this initiative will continue during the current president’s administration.

Monetary Policy

The monetary policy of the Federal Reserve has a significant effect on the operating results of financial or bank holding companies and their subsidiaries, which was exacerbated by the COVID-19 pandemic.

The monetary policy of the Federal Reserve has a significant effect on the operating results of bank holding companies and their subsidiaries.

Among the tools available to the Federal Reserve to affect the money supply are open market transactions in U.S.

government securities and changes in the discount rate on bank borrowings.

These tools are used in varying combinations to influence overall growth and distribution of bank loans, investments, and deposits, and their use may affect interest rates charged on loans or paid on deposits.

Federal Securities Regulation

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Consequently, First Busey Corporation is subject to the information, proxy solicitation, insider trading and other restrictions and requirements of the SEC under the Exchange Act.

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Corporate Governance

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publicly traded companies.

It increased stockholder influence over boards of directors by requiring companies to give stockholders a nonbinding vote on executive compensation and so-called “golden parachute” payments and by authorizing the SEC to promulgate rules that would allow stockholders to nominate and solicit voters for their own candidates using a company’s proxy materials.

The legislation also directed the Federal Reserve to promulgate rules prohibiting excessive compensation paid to executives of bank holding companies, regardless of whether such companies are publicly traded.

It increased stockholder influence over boards of directors by requiring companies to give stockholders a nonbinding vote on executive compensation and so-called “golden parachute” payments, and it authorized the SEC to promulgate rules that would allow stockholders to nominate and solicit voters for their own candidates using a company’s proxy materials.

The Dodd-Frank Act also directed the Federal Reserve, together with the other federal banking and financial services agencies, to promulgate rules prohibiting excessive compensation paid to executives of bank holding companies, regardless of whether such companies are publicly traded.

As discussed in the “Incentive Compensation” section above, the federal banking and financial services agencies have proposed rules regarding incentive-based compensation arrangements for certain financial institutions, but no rule has been adopted at this time.

Supervision and Regulation of Busey Bank

Busey Bank is an Illinois-chartered bank.

Its deposit accounts are insured by the DIF to the maximum extent provided under federal law and FDIC regulations, currently $250,000 per insured depositor category.

Its deposit accounts are insured by the FDIC’s Deposit Insurance Fund to the maximum extent provided under federal law and FDIC regulations, currently $250,000 per insured depositor category.

As an Illinois-chartered FDIC-insured bank, Busey Bank is subject to the examination, supervision, reporting, and enforcement requirements of the DFPR, the chartering authority for Illinois banks.

Busey Bank is also regulated by the FDIC, designated by federal law as the primary federal regulator of insured state banks that, like Busey Bank, are not members of the Federal Reserve System.

In October 2024, Busey Bank became a member of the Federal Reserve System, and as a result, Busey Bank became subject to the examination, reporting, regulatory, and enforcement requirements of the Federal Reserve.

In addition, the FDIC, as administrator of its Deposit Insurance Fund, has regulatory authority over Busey Bank.

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Deposit Insurance

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A bank’s assessment is then calculated by multiplying its assessment rate by its assessment base (average consolidated total assets minus its average tangible equity).

The total base assessment rates currently range from 1.5 basis points to 30 basis points on an annualized basis.

However, the maximum rate is 18 basis points for financial institutions in the top two categories of examination composite ratings.

At least semi-annually, the FDIC updates its loss and income projections for the DIF and, if needed, increases or decreases the assessment rates, following notice and comment on proposed rule making.

For this purpose, the reserve ratio is the DIF balance divided by estimated insured deposits.

The total base assessment rates, effective as of January 1, 2023, currently range from 2.5 bps to 32 bps on an annualized basis.

However, the maximum rate is 18 bps for FDIC-insured institutions in the top two categories of examination composite ratings.

At least semi-annually, the FDIC updates its loss and income projections for its Deposit Insurance Fund and, if needed, increases or decreases the assessment rates, following a notice and comment period on proposed rule making.

For this purpose, the reserve ratio is the Deposit Insurance Fund balance divided by estimated insured deposits.

In response to the global financial crisis, the Dodd-Frank Act increased the minimum reserve ratio from 1.15% to 1.35% of the estimated amount of total insured deposits.

In the semi-annual update in June 2022, the FDIC projected that the reserve ratio was at risk of not reaching the statutory minimum of 1.35% by September 30, 2028, statutory deadline.

Based on this update, the FDIC approved an increase in initial base deposit insurance assessment rate schedules uniformly by two basis points, applicable to all insured depository institutions.

The increase was effective on January 1, 2023, applicable to the first quarterly assessment period of 2023 (January 1 through March 31, 2023).

In addition, because the total cost of the failures of Silicon Valley Bank and Signature Bank was approximately $16.3 billion, the FDIC adopted a special assessment for banks having deposits above $5 billion, at an annual rate of 13.4 basis points beginning with the first quarterly assessment period of 2024 (January 1 through March 31, 2024) with an invoice payment date of June 28, 2024, and will continue to collect special assessments for an anticipated total of eight quarterly assessment periods.

In its October 2024 semiannual update, the FDIC stated that the reserve ratio likely will reach the statutory minimum by the September 30, 2028, deadline, and no adjustments to the base assessment rates is currently projected.

In addition, because the total cost of the failures of Silicon Valley Bank and Signature Bank was approximately $24.1 billion, the FDIC adopted a special assessment for banking organizations with assets of $5 billion or more, at an annual rate of 13.4 bps beginning with the first quarterly assessment period of 2024 and an invoice payment date of June 28, 2024.

The FDIC will continue to collect special assessments for an anticipated total of eight quarterly assessment periods.

The base for the special assessment is equal to an insured depository institution’s estimated uninsured deposits for the December 31, 2022, reporting period, adjusted to exclude the first $5 billion in estimated uninsured deposits.

Busey Bank was not subject to this assessment due to uninsured deposits being below the $5 billion exclusion threshold.

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Table of Contents Contents of Item 1.

Busey Bank, as part of a banking organization with assets of $5 billion or more, was technically subject to the FDIC special assessment;

however, Busey Bank did not have to pay this assessment due to uninsured deposits being below the $5 billion exclusion threshold.

Supervisory Assessments

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The level and speed of deposit outflows contributing to the failures of Silicon Valley Bank, Signature Bank, and First Republic Bank in the first half of 2023 was unprecedented and contributed to acute liquidity and funding strain on the financial industry.

These events have further underscored the importance of liquidity risk management and contingency funding planning by insured depository institutions like Busey Bank.

The primary role of liquidity risk management is to:

These events have further underscored the importance of liquidity risk management and contingency funding planning by insured depository institutions like Busey Bank, as highlighted in a 2023 addendum to interagency guidance on funding and liquidity risk management.

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Primary roles of liquidity risk management are to:

(1) prospectively assess the need for funds to meet obligations;

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These tests provide an incentive for banks and holding companies to increase their holdings in Treasury securities and other sovereign debt as a component of assets, increase the use of long-term debt as a funding source and rely on stable funding like core deposits (in lieu of brokered deposits).

Although these tests do not, and will not, apply to Busey Bank, management continues to review its liquidity risk management framework in light of regulatory and industry developments.

Although these tests do not apply to Busey Bank, management continues to review its liquidity risk management framework in light of regulatory and industry developments.

For instance, in July 2024, the FDIC released a request for information on deposits, soliciting information on whether, and to what extent, certain types of deposits may behave differently from each other (particularly during periods of economic or financial stress).

At the present time, it is unclear how the FDIC may use the information that it gathered pursuant to this request, if at all.

However, the possibility remains that the information obtained through this request, or through other requests by the FDIC or other banking agencies, may be used to make regulatory changes that could have a future impact on liquidity monitoring and risk management requirements applicable to Busey Bank.

Dividend Payments

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The DFPR may restrict the declaration or payment of a dividend by an Illinois-chartered bank.

The payment of dividends by any FDIC-insured institution is affected by the requirement to maintain adequate capital pursuant to applicable capital adequacy guidelines and regulations, and a FDIC-insured institution generally is prohibited from paying any dividends if, following payment thereof, the institution would be undercapitalized.

Notwithstanding the availability of funds for dividends, the FDIC and the DFPR may prohibit the payment of dividends by Busey Bank if either or both determine such payment would constitute an unsafe or unsound practice.

In addition, under the Basel III Rule, institutions that seek the freedom to pay dividends have to maintain 2.5% in Common Equity Tier 1 Capital attributable to the capital conservation buffer.

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State Bank Investments and Activities

The Federal Reserve Act also imposes limitations on the amount of dividends paid by state member banks, such as Busey Bank.

Without Federal Reserve approval, a state member bank may not pay dividends in any calendar year that, in the aggregate, exceed that bank’s calendar year-to-date net income plus the bank’s retained income for the two preceding calendar years.

The payment of dividends by any FDIC-insured institution is affected by the requirement to maintain adequate capital pursuant to applicable capital adequacy guidelines and regulations, and an FDIC-insured institution generally is prohibited from paying any dividends if, following payment thereof, the institution would be undercapitalized.

Notwithstanding the availability of funds for dividends, the Federal Reserve, the FDIC, and the DFPR may prohibit the payment of dividends by Busey Bank if any of these banking agencies determines that such payment would constitute an unsafe or unsound practice.

In addition, under the Basel III Rule, FDIC-insured institutions that want to pay unrestricted dividends must maintain 2.5% in Common Equity Tier 1 Capital attributable to the capital conservation buffer.

State Bank Investments, Activities, and Acquisitions

Busey Bank is permitted to make investments and engage in activities directly or through subsidiaries as authorized by Illinois law.

However, under federal law and FDIC regulations, FDIC-insured state banks are prohibited, subject to certain exceptions, from making or retaining equity investments of a type, or in an amount, that are not permissible for a national bank.

Federal law and FDIC regulations also prohibit FDIC-insured state banks and their subsidiaries, subject to certain exceptions, from engaging as principal in any activity that is not permitted for a national bank unless the bank meets, and continues to meet, its minimum regulatory capital requirements, and the FDIC determines that the activity would not pose a significant risk to the DIF.

These restrictions have not had, and are not currently expected to have, a material impact on the operations of Busey Bank.

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Busey Bank may be required to seek approval from their applicable state regulator and the Federal Reserve (or in some cases, the FDIC) before engaging in certain acquisitions or mergers under applicable state and federal law.

In 2024, each of the OCC and the FDIC separately released updated policy statements—and in the case of the OCC, a final rule—regarding how each banking agency reviews applications submitted pursuant to the Bank Merger Act based on statutory factors.

The acting chairperson of the FDIC has indicated that the FDIC may seek to reverse the FDIC’s 2024 policy statement.

Although the Federal Reserve, Busey Bank’s primary federal regulator, did not release any updated policy statement or rules regarding its review process under the Bank Merger Act in recent years, management of Busey Bank and Busey has considered the impact that the OCC’s and FDIC’s rules and guidance may have on the review of any relevant transactions that Busey Bank undertakes.

Insider Transactions

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In general, the safety and soundness standards prescribe the goals to be achieved in each area, and each institution is responsible for establishing its own procedures to achieve those goals.

While regulatory standards do not have the force of law, if an institution operates in an unsafe and unsound manner, the FDIC-insured institution’s primary federal regulator may require the institution to submit a plan for achieving and maintaining compliance.

If an FDIC-insured institution fails to submit an acceptable compliance plan, or fails in any material respect to implement a compliance plan that has been accepted by its primary federal regulator, the regulator is required to issue an order directing the institution to cure the deficiency.

Until the deficiency cited in the regulator’s order is cured, the regulator may restrict the FDIC-insured institution’s rate of growth, require the FDIC-insured institution to increase its capital, restrict the rates the institution pays on deposits, or require the institution to take any action the regulator deems appropriate under the circumstances.

Noncompliance with safety and soundness may also constitute grounds for other enforcement action by the federal bank regulatory agencies, including cease and desist orders and civil money penalty assessments.

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Although regulatory standards do not have the force of law, if an institution operates in an unsafe and unsound manner, the FDIC-insured institution’s primary federal regulator may require the institution to submit a plan for achieving and maintaining compliance.

If an FDIC-insured institution fails to submit an acceptable compliance plan, or fails in any material respect to implement a compliance plan that has been accepted by its primary federal regulator, the banking agency is required to issue an order directing the institution to cure the deficiency.

Until the deficiency cited in the agency’s order is cured, the agency may restrict the FDIC-insured institution’s rate of growth, require the FDIC-insured institution to increase its capital, restrict the rates the institution pays on deposits, or require the institution to take any action that the agency deems appropriate under the circumstances.

Noncompliance with safety and soundness may also constitute grounds for other enforcement action by the federal banking agencies, including cease and desist orders and civil money penalty assessments.

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During the past decade, bank regulatory agencies have increasingly emphasized the importance of sound risk management processes and strong internal controls when evaluating the activities of the FDIC-insured institutions they supervise.

During the past decade, banking agencies have increasingly emphasized the importance of sound risk management processes and strong internal controls when evaluating the activities of the FDIC-insured institutions they supervise.

Properly managing risk has been identified as critical to the conduct of safe and sound banking activities, and has become even more important as new technologies, product innovation, and the size and speed of financial transactions have changed the nature of banking markets.

The agencies have identified a spectrum of risks facing a banking institution including, but not limited to, credit, market, liquidity, operational, legal, and reputational risk.

The key risk themes identified by the Company for 2024 are discussed under “ Item 1A.

The banking agencies have identified a spectrum of risks facing a banking organization including, but not limited to, credit, market, liquidity, operational, legal, and reputational risk.

The key risk themes identified by Busey for 2024 are discussed under “ Item 1A.

Risk Factors ” below.

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and comprehensive internal controls.

The federal banking agencies also have released specific risk management guidance on certain topics, including third-party relationships, in response to the proliferation of relationships between banking organizations and financial technology companies (although the guidance applies more broadly).

Privacy and Cybersecurity

Busey Bank is subject to many U.S.

federal and state laws and regulations governing requirements for maintaining policies and procedures to protect non-public confidential information of its customers.

federal and state laws and regulations governing requirements for maintaining policies and procedures to protect non-public personal and other confidential information of its customers.

These laws require Busey Bank to periodically disclose its privacy policies and practices relating to sharing such information and permit consumers to opt out of their ability to share information with unaffiliated third parties under certain circumstances.

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These security and privacy policies and procedures, for the protection of personal and confidential information, are in effect across all businesses and geographic locations.

Busey Bank and Busey also are subject to a number of federal and state laws and regulations requiring notifications and disclosures regarding certain cybersecurity incidents.

Busey Bank must also consider and address cybersecurity considerations as part of its risk management processes.

Branching Authority

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and (3) state law limitations requiring the merging bank to have been in existence for a minimum period of time (not to exceed five years) prior to the merger.

Federal Home Loan Bank System

Busey Bank is a member of a FHLB, which serves as a central credit facility for its members.

The FHLB is funded primarily from proceeds from the sale of obligations of the FHLB system.

It makes loans to member banks in the form of FHLB advances.

All advances from the FHLB are required to be fully collateralized as determined by the FHLB.

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Community Reinvestment Act Requirements

The CRA requires Busey Bank to have a continuing and affirmative obligation in a safe and sound manner to help meet the credit needs of the entire community, including low- and moderate-income neighborhoods.

Federal regulators regularly assess Busey Bank’s record of meeting the credit needs of its communities in dedicated examinations.

Applications for acquisitions are affected by the evaluation of Busey Bank’s effectiveness in meeting its CRA requirements.

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On October 24, 2023, the bank regulatory agencies issued a final rule to strengthen and modernize CRA regulations (the "CRA Rule"), some of which is effective beginning April 1, 2024.

Federal banking agencies regularly assess Busey Bank’s record of meeting the credit needs of its communities in dedicated examinations.

Busey Bank’s CRA ratings derived from these examinations can have significant impacts on the activities in which Busey Bank and Busey may engage.

For example, a low CRA rating may impact the review of applications for acquisitions by Busey Bank, or Busey’s financial holding company status.

On October 24, 2023, the banking agencies issued a final rule to strengthen and modernize the CRA regulations (the "CRA Rule").

Management of Busey Bank has effectively assessed the impact of the CRA Rule on its CRA lending and investment activities in its respective markets and continues to align its program with current and future expectations.

The CRA Rule is designed to update how CRA activities qualify for consideration, where CRA activities are considered, and how CRA activities are evaluated.

More specifically, the bank regulatory agencies described the goals of the CRA Rule as follows:

More specifically, the banking agencies described the goals of the CRA Rule as follows:

(1) to expand access to credit, investment, and basic banking services in low and moderate-income communities;

3 unchanged sentences

and (5) to maintain a unified approach among the regulators.

Management of Busey Bank is assessing the impact of the CRA Rule on its CRA lending and investment activities in its markets.

In 2022, Busey Bank, like all Illinois chartered banks, became subject to state-level CRA standards, following passage of the Illinois CRA.

1 unchanged sentence

Like the potential impact under the federal CRA, applications for additional acquisitions or activities would be affected by the evaluation of Busey Bank’s effectiveness in meeting its Illinois CRA requirements.

Anti-Money Laundering/Countering the Financing of Terrorism

Anti-Money Laundering/Countering the Financing of Terrorism/Sanctions

The Bank Secrecy Act is the common name for a series of laws and regulations enacted in the United States to combat money laundering and the financing of terrorism.

10 unchanged sentences

and (6) cooperation between FDIC-insured institutions and law enforcement authorities.

Busey Bank must also comply with stringent economic and trade sanctions regimes administered and enforced by the Office of Foreign Assets Control.

First Busey Corporation (BUSE) | 2024 — 24

Table of Contents Contents of Item 1.

Concentrations in Commercial Real Estate

Concentration risk exists when FDIC-insured institutions deploy too many assets to any one industry or segment.

A concentration in CRE is one example of regulatory concern.

A concentration in CRE is one example of regulatory concern that has, in recent years, been subject to additional scrutiny by federal banking agencies as well as the SEC for publicly-traded banking organizations.

The interagency CRE Guidance provides supervisory criteria, including the following numerical indicators, to assist bank examiners in identifying banks with potentially significant CRE loan concentrations that may warrant greater supervisory scrutiny:

2 unchanged sentences

The CRE Guidance does not limit banks’ levels of CRE lending activities, but rather guides institutions in developing risk management practices and levels of capital that are commensurate with the level and nature of their CRE concentrations.

On December 18, 2015, federal banking agencies issued a statement to reinforce prudent risk-management practices related to CRE lending, having observed substantial growth in many CRE asset and lending markets, increased competitive pressures, rising CRE concentrations in banks, and an easing of CRE underwriting standards.

Federal bank agencies reminded FDIC-insured institutions to maintain underwriting discipline and exercise prudent risk-management practices to identify, measure, monitor, and manage the risks arising from CRE lending.

On December 18, 2015, and again in more recent years, the federal banking agencies have issued statements to reinforce prudent risk-management practices related to CRE lending, having observed substantial growth in many CRE asset and lending markets, increased competitive pressures, rising CRE concentrations in banks, and an easing of CRE underwriting standards.

The federal banking agencies have reminded FDIC-insured institutions to maintain underwriting discipline and exercise prudent risk-management practices to identify, measure, monitor, and manage the risks arising from CRE lending.

In addition, FDIC-insured institutions must maintain capital commensurate with the level and nature of their CRE concentration risk.

As of December 31, 2024, Busey Bank did not exceed these guidelines.

First Busey Corporation | 2023 — 23

Table of Contents Contents of Item 1.

Consumer Financial Services

3 unchanged sentences

Busey Bank is under CFPB oversight for consumer banking transactions.

Because abuses in connection with residential mortgages were a significant factor contributing to the financial crisis, many new rules issued by the CFPB and required by the Dodd-Frank Act addressed mortgage and mortgage-related products, their underwriting, origination, servicing, and sales.

Because abuses in connection with residential mortgages were a significant factor contributing to the global financial crisis, many initial rules issued by the CFPB and required by the Dodd-Frank Act addressed mortgage and mortgage-related products, their underwriting, origination, servicing, and sales.

The Dodd-Frank Act significantly expanded underwriting requirements applicable to loans secured by 1-4 family residential real property and augmented federal law combating predatory lending practices.

In addition to numerous disclosure requirements, the Dodd-Frank Act imposed new standards for mortgage loan originations on all lenders, including banks and savings associations, in an effort to strongly encourage lenders to verify a borrower’s ability to repay, while also establishing a presumption of compliance for certain “qualified mortgages.” The CFPB has from time to time released additional rules as to qualified mortgages and the borrower’s ability to repay.

Over the last several years, the CFPB has taken a proactive, multi-front approach to protect consumers from excessive overdraft and non-sufficient funds fees.

This includes proposed rules, interpretive opinions and enforcement actions.

In January 2024, this included a proposed rule that would prohibit non-sufficient funds fees on transactions declined in real time (debit card purchases, ATM withdrawals, and peer-to-peer payments) and a proposal to subject overdrafts on bank accounts to disclosure rules applicable to other kinds of credit.

The actions proposed or taken thus far by the CFPB affects financial institutions, like Busey Bank, with more than $10 billion in assets.

Busey Bank’s management expects continued developments in this area that will impact its overdraft practices and may result in a decrease in fee income.

The CFPB’s rules have an impact on Busey Bank’s operations, including by increasing compliance costs and potentially negatively affecting revenue.

In addition to numerous disclosure requirements, the Dodd-Frank Act and the CFPB’s enabling regulations imposed new standards for mortgage loan originations on all lenders, including banks and savings associations, in an effort to strongly encourage lenders to verify a borrower’s ability to repay, while also establishing a presumption of compliance for certain “qualified mortgages.” The CFPB has from time to time released additional rules as to qualified mortgages and the borrower’s ability to repay.

First Busey Corporation (BUSE) | 2024 — 25

Table of Contents Contents of Item 1.

Over the last several years, the CFPB has taken an aggressive approach to the regulation and supervision, where applicable, of providers of consumer financial products and services.

In particular, the CFPB has taken, or attempted to take, a proactive, multi-front approach to protect consumers from excessive overdraft and non-sufficient funds fees.

This includes proposed and final rules, interpretive opinions, and enforcement actions.

In 2024, the CFPB finalized a rule that eliminated an exemption for overdraft fees from lending laws (the “Overdraft Rule”).

The Overdraft Rule, which has an effective date of October 1, 2025, applies to financial institutions, such as FDIC-insured institutions, with over $10 billion in assets , like Busey Bank, and provides several different options on how to approach charging overdraft fees.

Busey expects that the implementation of this rule may result in a decrease in fee income.

Several banks and trade associations have sued the CFPB regarding the Overdraft Rule, claiming that the CFPB has exceeded its regulatory authority.

The CFPB is now under new acting leadership and has paused much of its existing work.

It remains unclear what this will mean for the agency and its oversight of consumer protection laws and regulations.

Though some of the CFPB’s rulemakings are under review, the laws, rules, and regulations that the agency has enforced since its inception currently remain intact and could be enforced by other banking agencies.

Consumer protection rules have an impact on Busey Bank’s operations, including by increasing compliance costs and potentially negatively affecting earnings.

Busey Bank must also comply with certain state consumer protection laws and requirements in the states in which it operates.

SECURITIES AND EXCHANGE COMMISSION REPORTING AND OTHER INFORMATION

6 unchanged sentences

Busey believes the adjusted measures are useful for investors and management to understand the effects of certain non-core and non-recurring noninterest items and provide additional perspective on Busey’s performance over time.

First Busey Corporation | 2023 — 24

Table of Contents Contents of Item 1.

Non-GAAP disclosures have inherent limitations and are not audited.

They should not be considered in isolation or as a substitute for the results reported in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

Tax effected numbers included in these non-GAAP disclosures are based on estimated statutory rates and effective rates as appropriate.

A listing of Busey's non-GAAP financial measures and ratios are shown in the table below, together with the related GAAP financial measures, followed by a reconciliation of non-GAAP financial measures to what management believes to be the most directly comparable GAAP financial measures.

First Busey Corporation | 2023 — 25

Table of Contents Contents of Item 1.

GAAP Financial Measures Related Non-GAAP Financial Measures Related Non-GAAP Ratios

Net interest income

Total noninterest income

Net security gains and losses

Total noninterest expense Pre-provision net revenue Pre-provision net revenue to average assets

Adjusted pre-provision net revenue Adjusted pre-provision net revenue to average assets

Net income Adjusted net income Adjusted diluted earnings per share

Adjusted return on average assets

Adjusted return on average tangible common equity

Average common equity Average tangible common equity Return on average tangible common equity

Adjusted return on average tangible common equity

Net interest income Tax-equivalent net interest income Net interest margin

Adjusted net interest income Adjusted net interest margin

Net interest income

Total noninterest income

Net security gains and losses Tax-equivalent revenue Efficiency ratio

Adjusted efficiency ratio

Adjusted core efficiency ratio

Total noninterest expense

Amortization of intangible assets Noninterest expense excluding amortization of intangible assets Efficiency ratio

Adjusted noninterest expense Adjusted efficiency ratio

Adjusted core expense Adjusted core efficiency ratio

Total noninterest expense Noninterest expense, excluding non-operating adjustments

Goodwill and other intangible assets, net Tangible assets Tangible common equity to tangible assets

Total stockholders’ equity

Goodwill and other intangible assets, net Tangible common equity Tangible common equity to tangible assets

Tangible book value Tangible book value per common share

Portfolio loans Core loans Core loans to portfolio loans

Core loans to core deposits

Total deposits Core deposits Core deposits to total deposits

Core loans to core deposits

First Busey Corporation | 2023 — 26

Tax effected numbers included in these non-GAAP disclosures are based on estimated statutory rates, estimated federal income tax rates, or effective tax rates as noted with the tables below.

The following tables present reconciliations between these non-GAAP measures and what management believes to be the most directly comparable GAAP financial measures.

First Busey Corporation (BUSE) | 2024 — 26

Table of Contents Contents of Item 1.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Unaudited)

Pre-Provision Net Revenue, Adjusted Pre-Provision Net Revenue,

Pre-Provision Net Revenue to Average Assets, and

Adjusted Pre-Provision Net Revenue to Average Assets

Pre-Provision Net Revenue and Related Measures

(dollars in thousands)

1 unchanged sentence

2024 2023 2022

PRE-PROVISION NET REVENUE

Net interest income $ 319,451 $ 323,438 $ 270,698

Total noninterest income 122,384 126,803 132,804

Net security (gains) losses 2,199 2,133 (3,070)

Total noninterest expense (285,532) (283,881) (261,780)

Pre-provision net revenue [a] 158,502 168,493 138,652

Non-GAAP adjustments:

Acquisition and other restructuring expenses 4,328 4,537 17,351

Net interest income (GAAP) $ 322,611 $ 320,621 $ 323,628

Total noninterest income (GAAP) 139,682 121,214 126,613

Net security (gains) losses (GAAP) 6,102 2,199 2,133

Total noninterest expense (GAAP) (300,399) (285,532) (283,881)

Pre-provision net revenue (Non-GAAP) [a] 167,996 158,502 168,493

Acquisition and restructuring expenses 8,140 4,328 4,537

Provision for unfunded commitments (1,095) 461 61

Amortization of New Markets Tax Credits 8,999 6,333 5,563

Adjusted pre-provision net revenue [b] $ 172,290 $ 179,424 $ 160,792

Average total assets [c] $ 12,246,218 $ 12,492,948 $ 11,904,935

Pre-provision net revenue to average assets

Amortization of New Markets Tax Credit — 8,999 6,333

Realized (gain) loss on the sale of mortgage service rights (7,724) — —

Adjusted pre-provision net revenue (Non-GAAP) [b] $ 167,317 $ 172,290 $ 179,424

Average total assets (GAAP) [c] $ 12,051,871 $ 12,246,218 $ 12,492,948

Pre-provision net revenue to average total assets (Non-GAAP)

[a÷c] 1.39 % 1.29 % 1.35 %

Pre-provision net revenue to average assets

Adjusted pre-provision net revenue to average total assets (Non-GAAP)

[b÷c] 1.39 % 1.41 % 1.44 %

First Busey Corporation | 2023 — 27

First Busey Corporation (BUSE) | 2024 — 27

Table of Contents Contents of Item 1.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Unaudited)

Adjusted Net Income, Adjusted Diluted Earnings Per Share, Adjusted Return on Average Assets, Average Tangible Common Equity, Return on Average Tangible Common Equity, and Adjusted Return on Average Tangible Common Equity

Adjusted Net Income, Average Tangible Common Equity, and Related Ratios

(dollars in thousands, except per share amounts)

1 unchanged sentence

2024 2023 2022

NET INCOME ADJUSTED FOR NON-OPERATING ITEMS

Net income [a] $ 122,565 $ 128,311 $ 123,449

Non-GAAP adjustments:

Net income (GAAP) [a] $ 113,691 $ 122,565 $ 128,311

Acquisition expenses:

1 unchanged sentence

Data processing 548 — 214

Professional fees, occupancy, and other 357 258 2,599

Other restructuring expenses:

Professional fees, occupancy, furniture and fixtures, and other 4,896 357 258

Acquisition expenses 6,901 357 1,059

Restructuring expenses:

Salaries, wages, and employee benefits 123 3,760 2,409

Loss on leases or fixed asset impairment — — 986

Professional fees, occupancy, and other 211 83 6

Professional fees, occupancy, furniture and fixtures, and other 1,116 211 83

Restructuring expenses 1,239 3,971 3,478

Acquisition and restructuring expenses 8,140 4,328 4,537

Related tax benefit 1

(2,026) (881) (938)

Adjusted net income [b] $ 126,012 $ 131,910 $ 137,108

DILUTED EARNINGS PER SHARE

Diluted average common shares outstanding [c] 56,256,148 56,137,164 56,008,805

Diluted earnings per share

[a÷c] $ 2.18 $ 2.29 $ 2.20

Diluted earnings per share

[b÷c] 2.24 2.35 2.45

RETURN ON AVERAGE ASSETS

Average total assets [d] $ 12,246,218 $ 12,492,948 $ 11,904,935

Return on average assets

[a÷d] 1.00 % 1.03 % 1.04 %

Return on average assets

[b÷d] 1.03 % 1.06 % 1.15 %

RETURN ON AVERAGE TANGIBLE COMMON EQUITY

Average common equity $ 1,197,511 $ 1,195,171 $ 1,324,862

Adjusted net income (Non-GAAP) [b] $ 119,805 $ 126,012 $ 131,910

Weighted average number of common shares outstanding, diluted (GAAP) [c] 57,543,001 56,256,148 56,137,164

Diluted earnings per common share (GAAP) [a÷c] $ 1.98 $ 2.18 $ 2.29

Adjusted diluted earnings per common share (Non-GAAP) [b÷c] 2.08 2.24 2.35

Average total assets (GAAP) [d] $ 12,051,871 $ 12,246,218 $ 12,492,948

Return on average assets (GAAP) [a÷d] 0.94 % 1.00 % 1.03 %

Adjusted return on average assets (Non-GAAP) [b÷d] 0.99 % 1.03 % 1.06 %

Average common equity (GAAP) $ 1,342,424 $ 1,197,511 $ 1,195,171

Average goodwill and other intangible assets, net (366,601) (359,347) (370,424)

Average tangible common equity [e] $ 838,164 $ 824,747 $ 952,269

Return on average tangible common equity

[a÷e] 14.62 % 15.56 % 12.96 %

Return on average tangible common equity

[b÷e] 15.03 % 15.99 % 14.40 %

Average tangible common equity (Non-GAAP) [e] $ 975,823 $ 838,164 $ 824,747

Return on average tangible common equity (Non-GAAP) [a÷e] 11.65 % 14.62 % 15.56 %

Adjusted return on average tangible common equity (Non-GAAP) [b÷e] 12.28 % 15.03 % 15.99 %

___________________________________________

Tax benefits were calculated by multiplying acquisition expenses and other restructuring expenses by the effective tax rates for each period.

Effective tax rates used in this calculation were 20.4%, 20.7%, and 21.3% for the years ended December 31, 2023, 2022, and 2021, respectively.

First Busey Corporation | 2023 — 28

Tax benefits were calculated by multiplying acquisition expenses and other restructuring expenses by tax rates of 24.9%, 20.4%, and 20.7% for the years ended December 31, 2024, 2023, and 2022, respectively.

First Busey Corporation (BUSE) | 2024 — 28

Table of Contents Contents of Item 1.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Unaudited)

Adjusted Net Interest Income and Adjusted Net Interest Margin

Tax-Equivalent Net Interest Income, Adjusted Net Interest Income, Net Interest Margin, and Adjusted Net Interest Margin

(dollars in thousands)

1 unchanged sentence

2024 2023 2022

Net interest income $ 319,451 $ 323,438 $ 270,698

Non-GAAP adjustments:

Net interest income (GAAP) $ 322,611 $ 320,621 $ 323,628

Tax-equivalent adjustment 1

1,693 2,173 2,199

Tax-equivalent net interest income [a] 321,624 325,637 273,053

Tax-equivalent net interest income (Non-GAAP) [a] 324,304 322,794 325,827

Purchase accounting accretion related to business combinations (3,166) (1,477) (3,134)

Adjusted net interest income [b] $ 320,147 $ 322,503 $ 265,902

Average interest-earning assets [c] $ 11,164,594 $ 11,473,063 $ 10,978,116

Net interest margin

[a÷c] 2.88 % 2.84 % 2.49 %

Net interest margin

[b÷c] 2.87 % 2.81 % 2.42 %

Adjusted net interest income (Non-GAAP) [b] $ 321,138 $ 321,317 $ 322,693

Average interest-earning assets (GAAP) [c] $ 10,999,424 $ 11,181,010 $ 11,479,730

Net interest margin (Non-GAAP) [a÷c] 2.95 % 2.89 % 2.84 %

Adjusted net interest margin (Non-GAAP) [b÷c] 2.92 % 2.87 % 2.81 %

___________________________________________

Tax-equivalent adjustments were calculated using an estimated federal income tax rate of 21%, applied to non-taxable interest income on investments and loans.

First Busey Corporation | 2023 — 29

First Busey Corporation (BUSE) | 2024 — 29

Table of Contents Contents of Item 1.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Unaudited)

Noninterest Expense Excluding Amortization of Intangible Assets, Adjusted Noninterest Expense,

Adjusted Core Expense, Noninterest Expense Excluding Non-operating Adjustments,

Efficiency Ratio, Adjusted Efficiency Ratio, and Adjusted Core Efficiency Ratio

Adjusted Noninterest Income, Revenue Measures, Adjusted Noninterest Expense, Adjusted Core Expense, and Efficiency Ratios

(dollars in thousands)

1 unchanged sentence

2024 2023 2022

Net interest income $ 319,451 $ 323,438 $ 270,698

Non-GAAP adjustments:

Net interest income (GAAP) [a] $ 322,611 $ 320,621 $ 323,628

Tax-equivalent adjustment 1

1,693 2,173 2,199

Tax-equivalent net interest income 321,624 325,637 273,053

Total noninterest income 122,384 126,803 132,804

Non-GAAP adjustments:

Net security (gains) losses 2,199 2,133 (3,070)

Noninterest income excluding net securities gains and losses 124,583 128,936 129,734

Tax-equivalent revenue [a] $ 446,207 $ 454,573 $ 402,787

Total noninterest expense $ 285,532 $ 283,881 $ 261,780

Non-GAAP adjustments:

Amortization of intangible assets [b] (10,432) (11,628) (11,274)

Noninterest expense excluding amortization of intangible assets [c] 275,100 272,253 250,506

Non-operating adjustments:

Salaries, wages, and employee benefits (3,760) (2,996) (7,819)

Data processing — (214) (3,700)

Lease or fixed asset impairment — (986) (3,227)

Professional fees and other (568) (341) (2,605)

Adjusted noninterest expense [f] 270,772 267,716 233,155

Tax-equivalent net interest income (Non-GAAP) [b] 324,304 322,794 325,827

Total noninterest income (GAAP) 139,682 121,214 126,613

Net security (gains) losses (GAAP) 6,102 2,199 2,133

Noninterest income excluding net securities gains and losses (Non-GAAP) [c] 145,784 123,413 128,746

Realized net (gains) losses on the sale of mortgage servicing rights (GAAP) (7,724) — —

Adjusted noninterest income (Non-GAAP) [d] $ 138,060 $ 123,413 $ 128,746

Tax-equivalent revenue (Non-GAAP) [e = b+c] $ 470,088 $ 446,207 $ 454,573

Adjusted tax-equivalent revenue (Non-GAAP) [f = b+d] 462,364 446,207 454,573

Operating revenue (Non-GAAP) [g = a+d] 460,671 444,034 452,374

Adjusted noninterest income to operating revenue (Non-GAAP) [d÷g] 29.97 % 27.79 % 28.46 %

Total noninterest expense (GAAP) $ 300,399 $ 285,532 $ 283,881

Amortization of intangible assets (GAAP) [h] (10,057) (10,432) (11,628)

Noninterest expense excluding amortization of intangible assets (Non-GAAP) [i] 290,342 275,100 272,253

Acquisition and restructuring expenses (8,140) (4,328) (4,537)

Adjusted noninterest expense (Non-GAAP) [j] 282,202 270,772 267,716

Provision for unfunded commitments 1,095 (461) (61)

Amortization of New Markets Tax Credits (8,999) (6,333) (5,563)

Adjusted core expense [g] $ 261,312 $ 261,322 $ 228,366

Noninterest expense, excluding non-operating adjustments [f-b] $ 281,204 $ 279,344 $ 244,429

Efficiency ratio

[c÷a] 61.65 % 59.89 % 62.19 %

Efficiency ratio

[f÷a] 60.68 % 58.89 % 57.89 %

Core efficiency ratio

[g÷a] 58.56 % 57.49 % 56.70 %

Amortization of New Markets Tax Credit — (8,999) (6,333)

Adjusted core expense (Non-GAAP) [k] $ 283,297 $ 261,312 $ 261,322

Noninterest expense, excluding non-operating adjustments (Non-GAAP) [j-h] $ 292,259 $ 281,204 $ 279,344

Efficiency ratio (Non-GAAP) [i÷e] 61.76 % 61.65 % 59.89 %

Adjusted efficiency ratio (Non-GAAP) [j÷f] 61.03 % 60.68 % 58.89 %

Adjusted core efficiency ratio (Non-GAAP) [k÷f] 61.27 % 58.56 % 57.49 %

___________________________________________

The tax-equivalent adjustments were calculated using an estimated federal income tax rate of 21%, applied to non-taxable interest income on investments and loans.

First Busey Corporation | 2023 — 30

First Busey Corporation (BUSE) | 2024 — 30

Table of Contents Contents of Item 1.

3 unchanged sentences

As of December 31,

Total stockholders' equity $ 1,271,981 $ 1,145,977

Goodwill and other intangible assets, net (353,864) (364,296)

Tangible book value [a] $ 918,117 $ 781,681

Ending number of common shares outstanding [b] 55,244,119 55,279,124

Tangible book value per common share [a÷b] $ 16.62 $ 14.14

Total stockholders' equity (GAAP) $ 1,383,269 $ 1,271,981

Goodwill and other intangible assets, net (GAAP) (365,975) (353,864)

Tangible book value (Non-GAAP) [a] $ 1,017,294 $ 918,117

Ending number of common shares outstanding (GAAP) [b] 56,895,981 55,244,119

Tangible book value per common share (Non-GAAP) [a÷b] $ 17.88 $ 16.62

Tangible Assets, Tangible Common Equity, and Tangible Common Equity to Tangible Assets

1 unchanged sentence

As of December 31,

Total assets $ 12,283,415 $ 12,336,677

Non-GAAP adjustments:

Goodwill and other intangible assets, net (353,864) (364,296)

Total assets (GAAP) $ 12,046,722 $ 12,283,415

Goodwill and other intangible assets, net (GAAP) (365,975) (353,864)

Tax effect of other intangible assets 1

Tangible assets 2

Tangible assets (Non-GAAP) 2

[a] $ 11,687,126 $ 11,936,439

Total stockholders' equity $ 1,271,981 $ 1,145,977

Non-GAAP adjustments:

Goodwill and other intangible assets, net (353,864) (364,296)

Total stockholders' equity (GAAP) $ 1,383,269 $ 1,271,981

Goodwill and other intangible assets, net (GAAP) (365,975) (353,864)

Tax effect of other intangible assets 1

Tangible common equity 2

Tangible common equity (Non-GAAP) 2

[b] $ 1,023,673 $ 925,005

Tangible common equity to tangible assets 2

Tangible common equity to tangible assets (Non-GAAP) 2

[b÷a] 8.76 % 7.75 %

___________________________________________

Net of estimated deferred tax liability, calculated using the estimated statutory tax rate of 28%.

Net of estimated deferred tax liability, calculated using an estimated tax rate of 26.73% as of December 31, 2024, and 28.0% as of December 31, 2023.

Tax-effected measure.

First Busey Corporation | 2023 — 31

First Busey Corporation (BUSE) | 2024 — 31

Table of Contents Contents of Item 1.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Unaudited)

Core Loans, Core Loans to Portfolio Loans,

Core Deposits, Core Deposits to Total Deposits, and Core Loans to Core Deposits

Core Deposits and Related Ratios

(dollars in thousands)

As of December 31,

Portfolio loans [a] $ 7,651,034 $ 7,725,702

Non-GAAP adjustments:

PPP loans amortized cost (313) (845)

Core loans [b] $ 7,650,721 $ 7,724,857

Total deposits [c] $ 10,291,156 $ 10,071,280

Non-GAAP adjustments:

Brokered transaction accounts (6,001) (1,303)

Portfolio loans (GAAP) [a] $ 7,697,087 $ 7,651,034

Total deposits (GAAP) [b] $ 9,982,490 $ 10,291,156

Brokered deposits, excluding brokered time deposits of $250,000 or more (13,090) (6,001)

Time deposits of $250,000 or more (334,503) (386,286)

Core deposits [d] $ 9,898,869 $ 9,949,600

Core loans to portfolio loans [b÷a] 100.00 % 99.99 %

Core deposits to total deposits [d÷c] 96.19 % 98.79 %

Core loans to core deposits [b÷d] 77.29 % 77.64 %

First Busey Corporation | 2023 — 32

Core deposits (Non-GAAP) [c] $ 9,634,897 $ 9,898,869

Core deposits to total deposits (Non-GAAP) [c÷b] 96.52 % 96.19 %

Portfolio loans to core deposits (Non-GAAP) [a÷c] 79.89 % 77.29 %

First Busey Corporation (BUSE) | 2024 — 32

Table of Contents Item 1.

3 unchanged sentences

These forward-looking statements are covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

These statements, which are based on certain assumptions and estimates and describe our future plans, strategies, and expectations, can generally be identified by the use of the words “may,” “will,” “should,” “could,” “would,” “goal,” “plan,” “potential,” “estimate,” “project,” “believe,” “intend,” “anticipate,” “expect,” “target,” “aim” and similar expressions.

These forward-looking statements include statements relating to our projected growth, anticipated future financial performance, financial condition, credit quality, and management’s long-term performance goals, as well as statements relating to the anticipated effects on results of operations and financial condition from expected developments or events, our business and growth strategies, and any other statements that are not historical facts.

These statements, which are based on certain assumptions and estimates and describe Busey’s future plans, strategies, and expectations, can generally be identified by the use of the words “may,” “will,” “should,” “could,” “would,” “goal,” “plan,” “potential,” “estimate,” “project,” “believe,” “intend,” “anticipate,” “expect,” “target,” “aim” and similar expressions.

These forward-looking statements include statements relating to Busey’s projected growth, anticipated future financial performance, financial condition, credit quality, and management’s long-term performance goals, as well as statements relating to the anticipated effects on results of operations and financial condition from expected developments or events, business and growth strategies, and any other statements that are not historical facts.

These forward-looking statements are subject to significant risks, assumptions, and uncertainties, and could be affected by many factors.

Factors that could have a material adverse effect on our financial condition, results of operations, and future prospects can be found under “ Item 1A.

Risk Factors ” in this Annual Report and elsewhere in our periodic and current reports filed with the SEC.

Factors that could have a material adverse effect on Busey’s financial condition, results of operations, and future prospects can be found under “ Item 1A.

Risk Factors ” in this Annual Report and elsewhere in Busey’s periodic and Current Reports filed with the SEC.

These factors include, but are not limited to, the following:

the possibility that any of the anticipated benefits of the proposed transaction between Busey and M&M will not be realized or will not be realized within the expected time period;

the risk that integration of operations of M&M with those of Busey will be materially delayed or will be more costly or difficult than expected;

the inability to complete the proposed transaction due to the failure of the required approval of M&M’s stockholders;

the failure to satisfy other conditions to completion of the proposed transaction, including receipt of required regulatory and other approvals;

the failure of the proposed transaction to close for any other reason;

the effect of the announcement of the transaction on customer relationships and operating results;

the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events;

the strength of the local, state, national, and international economy (including effects of inflationary pressures and supply chain constraints);

the economic impact of any future terrorist threats or attacks, widespread disease or pandemics (including the Coronavirus Disease 2019 pandemic), or other adverse external events that could cause economic deterioration or instability in credit markets (including Russia’s invasion of Ukraine and the Israeli-Palestinian conflict);

changes in state and federal laws, regulations, and governmental policies concerning Busey's or M&M's general business (including changes in response to the recent failures of other banks);

changes in accounting policies and practices;

changes in interest rates and prepayment rates of Busey’s or M&M's assets (including the impact of the LIBOR phase-out and the recent and potential additional rate increases by the Federal Reserve);

First Busey Corporation | 2023 — 33

risks related to the proposed transaction with CrossFirst, including (i) the possibility that the proposed transaction will not close when expected or at all because conditions to the closing are not satisfied on a timely basis or at all;

(ii) the possibility that the anticipated benefits of the proposed transaction will not be realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where Busey and CrossFirst do business;

(iii) the possibility that the merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events;

(iv) diversion of management's attention from ongoing business operations and opportunities;

(v) the possibility that Busey may be unable to achieve expected synergies and operating efficiencies in the merger within the expected timeframes or at all;

(vi) the possibility that Busey may be unable to successfully integrate CrossFirst's operations with those of Busey or that such integration may be more difficult, time consuming, or costly than expected;

(vii) revenues following the proposed transaction may be lower than expected;

and (viii) stockholder litigation that could prevent or delay the closing of the proposed transaction or otherwise negatively impact Busey's business and operations;

the strength of the local, state, national, and international economies and financial markets (including effects of inflationary pressures and supply chain constraints);

effects on the U.S.

economy resulting from the implementation of policies proposed by the new presidential administration, including tariffs, mass deportations, and tax regulations;

the economic impact of any future terrorist threats or attacks, widespread disease or pandemics, or other adverse external events that could cause economic deterioration or instability in credit markets (including Russia’s invasion of Ukraine and the conflict in the Middle East);

changes in state and federal laws, regulations, and governmental policies concerning Busey's general business (including changes in response to the bank failures in 2023 or as a result of changes in policies implemented by the new presidential administration);

the imposition of tariffs or other governmental policies impacting the value of products produced by the Company's commercial borrowers;

new or revised accounting policies and practices as may be adopted by state and federal regulatory banking agencies, the FASB, the SEC, or the PCAOB;

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Table of Contents Item 1.

Business Contents

changes in interest rates and prepayment rates of Busey’s assets (including the impact of sustained elevated interest rates);

increased competition in the financial services sector (including from non-bank competitors such as credit unions and fintech companies) and the inability to attract new customers;

changes in technology and the ability to develop and maintain secure and reliable electronic systems;

the loss of key executives or associates;

the loss of key executives or associates, talent shortages, and employee turnover;

changes in consumer spending;

unexpected results of acquisitions, including the acquisition of M&M and the performance of M&M’s life equity loan business;

unexpected outcomes of existing or new litigation involving Busey or M&M;

fluctuations in the value of securities held in Busey’s or M&M’s securities portfolio;

concentrations within Busey’s or M&M’s loan portfolio, large loans to certain borrowers, and large deposits from certain clients;

unexpected outcomes and costs of existing or new litigation, investigations, or other legal proceedings, inquiries, and regulatory actions involving Busey (including with respect to Busey’s Illinois franchise taxes);

fluctuations in the value of securities held in Busey’s securities portfolio, including as a result of changes in interest rates;

credit risk and risk from concentrations (by type of borrower, geographic area, collateral, and industry), within Busey's loan portfolio and large loans to certain borrowers (including CRE loans);

the overall health of the local and national real estate market;

the ability to maintain an adequate level of allowance for credit losses on loans;

the concentration of large deposits from certain clients who have balances above current FDIC insurance limits and may withdraw deposits to diversify their exposure;

the level of non-performing assets on Busey’s or M&M’s balance sheets;

the ability to successfully manage liquidity risk, which may increase dependence on non-core funding sources such as brokered deposits, and may negatively impact Busey's cost of funds;

the level of non-performing assets on Busey’s balance sheets;

interruptions involving information technology and communications systems or third-party servicers;

breaches or failures of information security controls or cybersecurity-related incidents;

the economic impact of exceptional weather occurrences such as tornadoes, hurricanes, floods, blizzards, and droughts;

the economic impact on Busey and its customers of climate change, natural disasters, and exceptional weather occurrences such as tornadoes, hurricanes, floods, blizzards, and droughts;

other factors and risks described under “ Item 1A.

Risk Factors ” herein.

Because of those risks and other uncertainties, our actual future results, performance, achievement, or industry results, may be materially different from the results indicated by these forward-looking statements.

In addition, our past results of operations are not necessarily indicative of our future results.

Because of those risks and other uncertainties, Busey’s actual future results, performance, achievement, or industry results, may be materially different from the results indicated by these forward-looking statements.

In addition, Busey’s past results of operations are not necessarily indicative of its future results.

You should not place undue reliance on any forward-looking statements, which speak only as of the dates on which they were made.

We are not undertaking an obligation to update these forward-looking statements, even though circumstances may change in the future, except as required under federal securities law.

We qualify all of our forward-looking statements by these cautionary statements.

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Busey does not undertake an obligation to update these forward-looking statements, even though circumstances may change in the future, except as required under federal securities law.

Busey qualifies all of its forward-looking statements by these cautionary statements.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business