UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended March 31, 2025 OR ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ______________ to ______________ Commission file number: 0-23636 Missouri 43-1626350 (State or other jurisdiction of (I.R.S. Employer Identification No.) 132 ...

JEFFERSON CITY, Mo., April 30, 2025 (GLOBE NEWSWIRE) -- Hawthorn Bancshares, Inc. (NASDAQ: HWBK) announced today that its Board of Directors approved a quarterly cash dividend of $0.20 per common share, payable July 1, 2025 to shareholders of record at the close of business on June 15, 2025, which represents an increase of $0.01 per common share from the prior quarter's dividend. About Hawthorn Bancshares, Inc. Hawthorn Bancshares, Inc., a financial-bank holding company headquartered in Jefferson City, Miss ...

JEFFERSON CITY, Mo., April 30, 2025 (GLOBE NEWSWIRE) -- Hawthorn Bancshares, Inc. (NASDAQ: HWBK), (the “Company”), the bank holding company for Hawthorn Bank, reported first quarter 2025 net income of $5.4 million, or earnings per diluted share (“EPS”) of $0.77. First Quarter 2025 Results Net income improved $0.9 million, or 20.8%, to $5.4 million from the first quarter 2024 (the "prior year quarter") and the efficiency ratio improved to 66.64% compared to 70.78% for the prior year quarterEPS of $0.77, an i ...

Exhibit 99.1 Hawthorn Bancshares Reports First Quarter 2025 Results Jefferson City, MO — April 30, 2025 — Hawthorn Bancshares, Inc. (NASDAQ: HWBK), (the "Company"), the bank holding company for Hawthorn Bank, reported first quarter 2025 net income of $5.4 million, or earnings per diluted share ("EPS") of $0.77. First Quarter 2025 Results Brent Giles, Chief Executive Officer of Hawthorn Bancshares, Inc. commented, "Our strong first quarter aligns with our focus on growing core relationships and improving fin ...

Financial Performance and Position - The Company reported a fourth-quarter repositioning of its balance sheet by selling $83.7 million in investment securities, resulting in an after-tax realized loss of $9.1 million[67]. - The profitability of the Company is significantly affected by local economic conditions in central and west-central Missouri and eastern Kansas, with potential declines in profitability due to increased unemployment and decreased real estate values[64]. - The primary source of earnings for the Bank is net interest income, which may decrease if prevailing interest rates decline, impacting the overall profitability of the Company[66]. - The Company faces credit risk as a lender, with potential loan defaults and increased charge-offs if borrowers are unable to repay their loans[70]. - The Bank's loan portfolio is susceptible to local economic conditions, and high levels of non-performing assets could adversely affect the Company's financial condition[71]. - The provision for credit losses may need to be increased if the financial condition of borrowers deteriorates or if real estate values decline, impacting future profitability[72]. - Adverse market conditions, including increased unemployment and reduced availability of commercial credit, could negatively impact the Company's business and credit performance[73]. - The FDIC's changes in deposit insurance premium calculations could increase non-interest expenses and adversely affect the Company's profitability[82]. - Liquidity risk is a concern for the Company, as insufficient liquidity could impair its ability to fund operations and meet obligations[78]. - The Company relies on customer deposits and may face challenges in replacing withdrawals or maturing deposits if market conditions change[79]. - The company may need to seek additional capital in the future, which could be affected by illiquid credit markets and economic conditions[83]. - The stock price of the company is subject to significant fluctuations due to various factors, including market conditions and operational performance, which could affect shareholder liquidity[122]. - The trading volume of the company's common stock is low, making it difficult for shareholders to sell shares quickly and potentially leading to price volatility[125]. - The company is not insured by any governmental entity, which poses additional risks for investors[126]. - The Company has not issued any new securities recently[154]. Competition and Market Conditions - The bank faces substantial competition from various financial institutions, which may adversely affect its ability to attract loans and deposits[85]. - Increased competition could lead to a decline in the bank's market share of deposits and loans, impacting its financial condition[86]. Operational and Compliance Risks - The company may experience difficulties in managing growth and integrating newly acquired companies, which could pose risks to profitability[87]. - The bank's success depends on its ability to generate loans and deposits at acceptable risk levels without significant increases in non-interest expenses[90]. - The bank's reputation is critical to its success, and any misconduct or errors could materially harm its performance[91]. - The company is exposed to operational risks, including fraudulent activities and cybersecurity incidents, which could disrupt business and increase costs[92]. - Regulatory changes may impact the profitability of the company's business activities and require significant management resources to comply[101]. - The Federal Reserve may require the company to commit capital resources to support its subsidiary bank, which could adversely affect its financial condition[102]. - Changes to regulatory capital requirements could result in lower returns on invested capital and require raising additional capital[104]. - The company is subject to increased FDIC deposit insurance premiums due to a decline in the reserve ratio of the Deposit Insurance Fund (DIF) relative to total insured deposits, which could adversely affect its financial condition[105]. - Non-compliance with laws such as the USA PATRIOT Act and Bank Secrecy Act could lead to fines, sanctions, and restrictions on expansion opportunities, impacting the company's growth potential[106]. - The company faces potential increased costs and operational impacts due to evolving privacy, cybersecurity, and data protection regulations, which could affect its business opportunities[107]. - Compliance with current and future laws may result in higher costs and restrict the company's ability to provide certain products and services, adversely affecting its financial condition[109]. Cybersecurity and IT Risks - The company relies heavily on technology and third-party vendors, and any operational disruptions or failures in these areas could materially impact its business operations and financial results[121]. - The Company has implemented a comprehensive cybersecurity and IT risk management program based on NIST and FFIEC frameworks, led by a Director with over 15 years of experience in cybersecurity[130]. - The Audit Committee meets quarterly to assess cybersecurity risks and receives reports on the status of the Company's information security program and emerging threats[131]. - The Company engages outside experts for cybersecurity assessments and audits, ensuring robust vendor management and annual due diligence on critical vendors[134]. - The Incident Response Program categorizes incidents into five severity levels, assessing impacts on financial loss, reputation, and service interruption[136]. - The Company has not experienced material adverse impacts from cyber threats to date, but acknowledges ongoing risks from malicious cyber activity[137]. - The company may face reputational damage and financial losses due to potential cybersecurity incidents, which could lead to increased costs for remediation and protection[118]. - Changes in accounting policies and adverse publicity could also impact the company's future financial performance and operational results[127]. Financial Reporting and Governance - The Company maintained effective internal control over financial reporting as of December 31, 2024, based on the criteria established in the Internal Control – Integrated Framework (2013)[170]. - There were no changes in the Company's internal control over financial reporting during the quarter ended December 31, 2024, that materially affected its internal control[168]. - The independent registered public accounting firm expressed an unqualified opinion on the Company's consolidated financial statements for the year ended December 31, 2024[171]. - The Company has no disagreements with accountants on accounting and financial disclosure[164]. - The consolidated financial statements for the years ended December 31, 2024, 2023, and 2022 are included in the Company's 2024 Annual Report to Shareholders[189]. - The auditor for the Company is Forvis Mazars, LLP, located in Kansas City, MO[190]. - The consolidated balance sheets as of December 31, 2024, and 2023 are reported, indicating the Company's financial position[190]. - The consolidated statements of income for the years ended December 31, 2024, 2023, and 2022 are provided, detailing revenue and expenses[191]. - The consolidated statements of comprehensive income for the years ended December 31, 2024, 2023, and 2022 are included, reflecting overall financial performance[192]. - The consolidated statements of stockholders' equity for the years ended December 31, 2024, 2023, and 2022 are presented, showing changes in equity[193]. - The consolidated statements of cash flows for the years ended December 31, 2024, 2023, and 2022 are available, detailing cash inflows and outflows[193]. - The Company has omitted certain financial statement schedules as they are not required or applicable[194]. - The Company has filed various exhibits related to executive compensation and corporate governance in its definitive Proxy Statement for the 2025 Annual Meeting of Shareholders[188]. - The Company has a policy for the recovery of erroneously awarded compensation, indicating a commitment to ethical governance practices[195].

Financial Performance - Fourth quarter 2024 net income was $4.6 million, or $0.66 per diluted share, consistent with the prior quarter and up 161.8% from the fourth quarter 2023[7] - For the year ended December 31, 2024, net income was $18.3 million, or $2.61 per diluted share, an increase of $17.3 million from the prior year[6] - Non-interest income for 2024 was $14.3 million, a 90.0% increase from $7.5 million in 2023[12] - Non-interest expenses decreased by $2.8 million, or 5.4%, to $49.5 million for 2024 compared to the prior year[14] Asset Quality - The allowance for credit losses was $22.0 million, or 1.50% of outstanding loans, as of December 31, 2024[22] - Non-performing loans decreased to $2,747,000 in Q4 2024 from $4,066,000 in Q3 2024, and down from $6,413,000 in Q4 2023[29] - Non-performing assets reduced to $4,193,000 in Q4 2024 from $8,451,000 in Q3 2024, and down from $8,157,000 in Q4 2023[29] - Net charge-offs for Q4 2024 were $43,000, significantly lower than $636,000 in Q3 2024 and $268,000 in Q4 2023[29] - Allowance for credit losses on non-performing loans is at 802.48% in Q4 2024, up from 539.52% in Q3 2024, and significantly higher than 370.25% in Q4 2023[29] Capital and Ratios - The company remains well capitalized with total risk-based capital of 14.79%[24] - Return on average assets for Q4 2024 is 1.00%, consistent with Q3 2024, compared to (1.57)% in Q4 2023[29] - Return on average common equity for Q4 2024 is 12.49%, slightly down from 12.87% in Q3 2024, and significantly improved from (24.54)% in Q4 2023[29] - Total risk-based capital ratio for Q4 2024 is 14.79%, slightly down from 14.91% in Q3 2024, and up from 13.99% in Q4 2023[29] - Common equity Tier 1 capital ratio for Q4 2024 is 10.49%, down from 10.53% in Q3 2024, and improved from 9.73% in Q4 2023[29] Operational Efficiency - Efficiency ratio improved to 68.48% in Q4 2024 from 66.23% in Q3 2024, and down from 81.06% in Q4 2023[29] Growth and Expansion - Total deposits increased by $29.7 million, or 2.0%, from the prior quarter, but decreased by $37.7 million, or 2.4%, from the prior year[23] - Investments rose by $14.8 million, or 7.1%, from the prior quarter and increased by $28.8 million, or 14.7%, from the prior year[18] - The company received approval to open a new banking center in Overland Park, Kansas, in February 2025[4] Interest Margin - Net interest margin improved to 3.55% in the fourth quarter 2024, compared to 3.36% in the prior quarter[4] - Net interest margin (FTE) increased to 3.55% in Q4 2024 from 3.36% in Q3 2024, and up from 3.48% in Q4 2023[29]

Core Viewpoint - Hawthorn Bancshares, Inc. reported strong financial results for the fourth quarter and full year of 2024, highlighting improvements in net income, operational efficiency, and strategic growth initiatives [1][4]. Financial Summary - Fourth quarter 2024 net income was $4.6 million, or $0.66 per diluted share, consistent with the prior quarter and a significant increase of $12.0 million, or 161.8%, from the fourth quarter of 2023 [6][8]. - For the year ended December 31, 2024, net income was $18.3 million, or $2.61 per diluted share, compared to $1.0 million, or $0.14 per diluted share, for 2023, reflecting an improvement of $17.3 million [7][29]. - The net interest margin for the fourth quarter improved to 3.55% from 3.36% in the prior quarter, while the full-year net interest margin was 3.41% [6][10]. Balance Sheet Information - Total assets as of December 31, 2024, were $1.825 billion, a slight increase from $1.810 billion in the prior quarter but a decrease from $1.875 billion in the prior year [5]. - Loans held for investment decreased to $1.466 billion, down 0.04% from the prior quarter and down 4.7% from the prior year [18]. - Total deposits increased by $29.7 million, or 2.0%, from the prior quarter to $1.533 billion, but decreased by $37.7 million, or 2.4%, from the prior year [25]. Capital and Asset Quality - The company maintained a "well capitalized" position with total risk-based capital of 14.79% as of December 31, 2024 [26]. - Non-performing loans to total loans improved to 0.19%, down from 0.42% in the prior year, indicating strong credit quality [20][31]. - The allowance for credit losses was $22.0 million, or 1.50% of outstanding loans, and 802.48% of non-performing loans [24]. Non-Interest Income and Expenses - Total non-interest income for 2024 was $14.3 million, an increase of $6.8 million, or 90.0%, from the prior year [13]. - Non-interest expense for 2024 decreased by $2.8 million, or 5.4%, to $49.5 million compared to $52.4 million in 2023 [15]. - The efficiency ratio for the fourth quarter was 68.5%, compared to 66.2% in the prior quarter and 81.1% in the prior year quarter [17]. Future Outlook - The company received approval to open a new banking center in Overland Park, Kansas, in February 2025, indicating ongoing growth initiatives [4].

Financial Performance - Consolidated net income for Q3 2024 was $4.6 million, or $0.66 per diluted share, representing a 77.4% increase from $2.6 million, or $0.36 per diluted share, in Q3 2023[146]. - For the nine months ended September 30, 2024, consolidated net income increased by $5.3 million, or 62.6%, to $13.7 million, or $1.95 per diluted share, compared to $8.4 million, or $1.19 per diluted share, for the same period in 2023[147]. - The return on average assets for Q3 2024 was 1.00%, and the return on average stockholders' equity was 12.87%[146]. - The efficiency ratio for Q3 2024 improved to 66.2% from 79.79% in Q3 2023[146]. Income and Expenses - Net interest income for Q3 2024 was $14.3 million, a decrease of $0.8 million from $15.1 million in Q3 2023, while the net interest margin (FTE) increased to 3.36% from 3.35%[149]. - Non-interest income for Q3 2024 was $3.8 million, up from $0.6 million in Q3 2023, primarily due to earnings on bank-owned life insurance and gains on the sale of other real estate[151]. - Non-interest expense for Q3 2024 was $12.0 million, a decrease from $12.6 million in Q3 2023, attributed to improved operational efficiencies[152]. - Total non-interest income increased by $3.2 million, or 524.3%, to $3.8 million for Q3 2024 compared to $0.6 million for Q3 2023[182]. - Total non-interest expense decreased by $0.6 million, or 4.6%, to $12.0 million for Q3 2024 compared to $12.6 million for Q3 2023[188]. Assets and Liabilities - Cash and cash equivalents decreased by $39.2 million to $54.2 million as of September 30, 2024, compared to $93.4 million as of December 31, 2023[153]. - Total assets were $1.81 billion as of September 30, 2024, down from $1.89 billion at the end of the previous year[162]. - Total deposits decreased by $67.3 million to $1.50 billion as of September 30, 2024, compared to $1.57 billion as of December 31, 2023[158]. - Total interest-bearing deposits were $1.13 billion, with an average cost of 2.74%[162]. - Total loans held for investment decreased to $1.47 billion as of September 30, 2024, from $1.54 billion as of December 31, 2023[196]. Credit Quality - Non-performing assets increased to $8.5 million as of September 30, 2024, from $7.4 million in 2023[144]. - Non-performing assets to total loans increased to 0.58% at September 30, 2024, from 0.53% at December 31, 2023, with non-performing assets totaling $8.5 million[155]. - The allowance for credit losses was $21.9 million, or 1.50% of loans outstanding, as of September 30, 2024, down from $23.7 million, or 1.54%, at December 31, 2023[157]. - The company's net charge-offs increased to $0.6 million for Q3 2024 from $0.1 million in Q3 2023, primarily due to one commercial loan relationship[212]. - The provision for credit losses recognized was $0.5 million for the three months ended September 30, 2024, compared to $0.1 million for the same period in 2023[208]. Capital Adequacy - The total risk-based capital ratio was 14.91% as of September 30, 2024, compared to 14.20% in 2023[144]. - The Company’s total capital to risk-weighted assets ratio was 14.91%, exceeding the minimum required ratio of 10.50%[241]. - The Company's Tier 1 capital to risk-weighted assets ratio was 13.66%, above the minimum required ratio of 8.50%[241]. - The Common Equity Tier 1 capital to risk-weighted assets ratio was 10.53%, surpassing the minimum required ratio of 7.00%[241]. - The Company met all capital adequacy requirements as of September 30, 2024, with regulatory capital ratios exceeding the levels established for well-capitalized institutions[244]. Liquidity - The company believes it has more than adequate liquidity to meet future anticipated needs, supported by additional funding capacity with the FHLB and the Federal Reserve Bank[229]. - As of September 30, 2024, the Company had $335.0 million in unused loan commitments and standby letters of credit, indicating adequate liquidity resources[233]. - The company had $96.4 million in outstanding borrowings with the Federal Home Loan Bank as of September 30, 2024, down from $107.0 million at December 31, 2023[225]. Shareholder Returns - The Company paid cash dividends totaling approximately $3.7 million and $3.5 million during the nine months ended September 30, 2024 and 2023, respectively[234]. - The Bank declared dividends of $15.0 million and $9.0 million to the Company during the nine months ended September 30, 2024 and 2023, respectively[234]. - The Company repurchased 56,692 common shares at an average cost of $19.51 per share, totaling $1.1 million, with $3.9 million remaining available for share repurchases[236]. Interest Rate Risk - The projected change in net interest income from interest rate shifts of up to 200 basis points is considered an acceptable level of interest rate risk[251]. - Average interest-earning assets decreased by $104.6 million, or 5.7%, to $1.72 billion for the quarter ended September 30, 2024[167]. - The average yield on loans increased to 5.83% for the quarter ended September 30, 2024, compared to 5.67% for the same period in 2023[171]. Inflation Impact - Inflation did not have a significant effect on the Company's operations for the three months ended September 30, 2024[255].

Core Viewpoint - Hawthorn Bancshares, Inc. reported a significant increase in net income and earnings per share for the third quarter of 2024, reflecting strong financial performance and strategic focus on core business lines [1][2][4]. Financial Performance - Net income for Q3 2024 was $4.6 million, an increase of $2.0 million or 77% from Q3 2023, with earnings per diluted share (EPS) of $0.66, up $0.30 or 83% from the prior year [2][4]. - Net interest margin improved to 3.36% in Q3 2024 from 3.33% in Q2 2024 [2][6]. - Return on average assets and equity were 1.00% and 12.87%, respectively [2][26]. Balance Sheet Highlights - Total assets decreased to $1.81 billion as of September 30, 2024, down from $1.88 billion a year earlier [3]. - Loans held for investment decreased by $31.8 million or 2.1% from the prior quarter, totaling $1.47 billion [3][14]. - Total deposits were $1.50 billion, a decrease of $46.7 million or 3.0% from the prior quarter [3][20]. Non-Interest Income and Expenses - Total non-interest income for Q3 2024 was $3.8 million, a decrease of $0.2 million or 5.3% from the prior quarter, but an increase of $3.2 million or 524.3% from the prior year [9][11]. - Total non-interest expense was $12.0 million, a slight decrease of $0.04 million or 0.3% from the prior quarter, and a decrease of $0.6 million or 4.6% from the prior year [12][24]. Asset Quality - Non-performing loans to total loans stood at 0.28%, indicating strong credit quality [2][19]. - The allowance for credit losses was $21.9 million, or 1.50% of outstanding loans, providing a buffer against potential losses [19][21]. Capital Position - The company maintained a "well capitalized" status with a total risk-based capital ratio of 14.91% as of September 30, 2024 [21][27]. - Book value per share increased to $20.91, up 24% from the prior year [2][3]. Strategic Initiatives - The CEO highlighted progress on strategic objectives, including reduced overhead expenses and expanded fee income [2].

Financial Performance - Net income for Q3 2024 was $4.6 million, an increase of $2.0 million or 77% compared to Q3 2023, with EPS of $0.66, up 83% from the prior year quarter[1][4] - Net income for Q3 2024 was $4,574,000, compared to $4,628,000 in Q2 2024 and significantly higher than $2,579,000 in Q3 2023[25] - Non-interest income for Q3 2024 was $3.8 million, a decrease of $0.2 million, or 5.3%, from the prior quarter, but an increase of $3.2 million, or 524.3%, from the prior year quarter[10] - Non-interest income for the nine months ended September 30, 2024, was $10,798,000, up from $5,384,000 in the same period of 2023[25] - Basic earnings per share for the nine months ended September 30, 2024, was $1.95, compared to $1.19 in the same period of 2023[25] Asset and Deposit Trends - Total assets decreased to $1.81 billion as of September 30, 2024, down from $1.85 billion at June 30, 2024, and $1.88 billion at September 30, 2023[3] - Total deposits were $1.50 billion, a decrease of $46.7 million, or 3.0%, from the prior quarter, and down $76.9 million, or 4.9%, from the prior year[21] - Loans held for investment decreased by $31.8 million, or 2.1%, to $1.47 billion compared to the prior quarter, and decreased by $90.2 million, or 5.8%, from the prior year[15] Credit Quality and Capital Ratios - The allowance for credit losses was $21.9 million, or 1.50% of outstanding loans, as of September 30, 2024, compared to $22.0 million, or 1.47%, at June 30, 2024[20] - Provision for credit losses on loans and unfunded commitments increased to $500,000 in Q3 2024 from $457,000 in Q2 2024 and $110,000 in Q3 2023[25] - Non-performing loans to total loans ratio was 0.28% in Q3 2024, slightly up from 0.25% in Q3 2023[27] - The Company maintained a total risk-based capital ratio of 14.91% as of September 30, 2024, indicating a "well capitalized" status[22] - Total risk-based capital ratio as of September 30, 2024, was 14.91%, up from 14.20% in the previous year[27] Efficiency and Profitability Metrics - The efficiency ratio for Q3 2024 was 66.23%, a slight improvement from 66.24% in the prior quarter and significantly better than 79.79% in the prior year quarter[14] - The efficiency ratio for Q3 2024 improved to 66.23% from 79.79% in Q3 2023[27] - Return on average assets for Q3 2024 was 1.00%, up from 0.54% in Q3 2023[27] - Return on average common equity for Q3 2024 was 12.87%, compared to 8.05% in Q3 2023[27] Interest Income - Total interest income for Q3 2024 was $23,819,000, a slight increase from $23,556,000 in Q2 2024 but a decrease from $23,888,000 in Q3 2023[25] Dividends - A quarterly cash dividend of $0.19 per common share was approved, payable on January 1, 2025, to shareholders of record on December 15, 2024[24]