• A local version of a national bank like Bank of America or JPMorgan Chase.
• Think of it like a community-focused PNC Bank, serving a specific regional area rather than nationwide.

• Deposit Services: Offers a range of checking, savings, money market, and certificate of deposit accounts for individuals and businesses.
• Residential Real Estate Lending: Provides mortgage loans for the purchase, refinancing, and construction of owner-occupied residential properties.
• Commercial Real Estate Lending: Finances the acquisition, development, and refinancing of income-producing commercial properties.
• Commercial and Industrial (C&I) Lending: Supplies loans and lines of credit to businesses for working capital, equipment, and other operational needs.
• Consumer Lending: Offers various personal loans including home equity lines of credit, auto loans, and other secured and unsecured credit facilities.

FS Bancorp (symbol: FSBW) is a bank holding company that operates primarily through its subsidiary, 1st Security Bank of Washington. As a financial institution, it serves a diverse customer base rather than having a few "major customers" in the traditional sense of a manufacturing or retail company. The company primarily sells its financial services to individuals and businesses.

The up to three major categories of customers that FS Bancorp serves are:

• Individuals/Retail Customers: This category includes consumers who utilize the bank for personal banking needs such as checking and savings accounts, residential mortgages, home equity loans, and other consumer lending products.
• Small and Medium-sized Businesses: Businesses of various sizes that use the bank for commercial checking and savings accounts, commercial loans, lines of credit, equipment financing, treasury management services, and other business banking solutions.
• Commercial Real Estate Investors and Developers: The bank has a significant focus on providing commercial real estate loans, construction loans, and related financial services tailored to investors and developers involved in the real estate sector.

• RSM US LLP
• Luse Gorman, PC

Joseph C. Adams, Chief Executive Officer

Joseph C. Adams is a director and has served as the Chief Executive Officer of 1st Security Bank of Washington since July 2004, and as CEO of FS Bancorp, Inc. since its formation in September 2011. He is slated to remain CEO of FS Bancorp until May 2026. Before his CEO roles, he joined 1st Security Bank of Washington in April 2003 as its Chief Financial Officer. Mr. Adams is a lawyer, having previously worked as a tax consultant for Deloitte, a lawyer for K&L Gates, and a lawyer and Director of Regulatory Affairs for Univar USA.

Matthew D. Mullet, President, FS Bancorp, Inc.

Matthew D. Mullet was appointed President of both 1st Security Bank and FS Bancorp, Inc. in July 2024. He is set to become President and CEO of 1st Security Bank effective September 1, 2025. Prior to his current role, he served as the Chief Financial Officer of both the Company and the Bank from September 2011 until May 1, 2025. Mr. Mullet began his banking career in June 2000 as a financial examiner with the Washington State Department of Financial Institutions, Division of Banks. In 2004, he joined Golf Savings Bank, where he held various positions before being promoted to Chief Financial Officer in 2007. After Golf Savings Bank merged with Sterling Savings Bank, he held the position of Senior Vice President of the Home Loan Division at Sterling before joining 1st Security Bank in July 2011.

Phillip Whittington, Chief Financial Officer

Phillip Whittington was promoted to Chief Financial Officer of FS Bancorp, Inc. on May 1, 2025. He joined 1st Security Bank in January 2020 as the Bank's Controller. Mr. Whittington graduated with distinction from the College of Charleston with a Bachelor of Science in Accounting and earned a Master of Accountancy from the University of South Carolina. He began his career in public accounting at Elliott Davis, specializing in their banking practice, where he was promoted to manager.

The key risks to FS Bancorp's business operations include its loan portfolio, exposure to interest rate fluctuations, and geographic concentration.

1. Loan Portfolio Risks: FS Bancorp faces considerable risks associated with its loan portfolio, particularly due to a significant portion of consumer loans, which are generally considered higher risk than first mortgage loans. The company's reliance on indirect home improvement loans also presents additional risks, including potential misstatements or misuse of loan proceeds. Furthermore, its commercial real estate and construction lending activities are susceptible to market downturns, necessitating provisions for credit losses. Analysts have also noted a slowing loan growth momentum, leading to trimmed price targets due to decelerating loan volumes.
2. Interest Rate Risk: As a financial institution, FS Bancorp is highly sensitive to changes in interest rates. Unexpected fluctuations in interest rates could materially affect its financial condition, including its net interest margin and overall earnings. The company's mortgage banking operations are particularly vulnerable to interest rate changes, which can adversely impact noninterest income. Additionally, its securities portfolio may experience negative impacts from shifts in market value and interest rates.
3. Geographic Concentration: FS Bancorp primarily operates within the Puget Sound region and the Pacific Northwest. This geographic concentration exposes the company to localized economic downturns and specific regional risks, such as natural disasters like flooding and earthquakes, which could affect the properties securing its loans and, consequently, its financial health.

The banking industry, particularly for community banks like FS Bancorp, faces two clear emerging threats:

• Emergence of Digital-First Banks (Neobanks): Neobanks, or challenger banks, operate entirely online or via mobile apps, offering streamlined digital experiences, often lower fees, and quicker service without the overhead of physical branches. Companies like Chime, SoFi, and other regional digital banks are increasingly attracting younger demographics and tech-savvy customers, including small businesses, who might otherwise bank with traditional community institutions like FS Bancorp. Their rapid growth and customer acquisition represent a direct challenge to the traditional banking model, mirroring how online streaming services disrupted physical video rental stores.

• Expansion of Fintech Companies into Traditional Banking Services: Non-bank financial technology companies, such as Block (Square), PayPal, and various online lending platforms, are expanding beyond their core payment processing or niche lending services to offer a broader suite of financial products. These now include deposit accounts, debit cards, and more comprehensive financial tools typically provided by banks. This directly competes for small business and consumer relationships and transaction volume that community banks rely on, often leveraging superior technology and data analytics to offer faster approvals and more tailored financial products, disrupting traditional bank-client relationships.

FS Bancorp (NASDAQ: FSBW) operates as a bank holding company for 1st Security Bank of Washington, primarily serving local families, and regional businesses in Washington and Oregon, with a significant focus on the greater Puget Sound area. The company's main products and services fall into two key segments: Commercial and Consumer Banking, and Home Lending.

The addressable markets for FS Bancorp's main products and services in its primary operating region of Washington State can be estimated as follows:

Residential Mortgage Market (Washington State)

The residential mortgage market in Washington State demonstrates significant activity. In July 2025, the total dollar value of closed sales for residential homes and condominiums in Washington State was approximately $5.69 billion. The median home sales price in Washington State was around $647,600 in July 2025 and $646,100 in August 2025. There is substantial underlying demand, with an estimated need for 1.1 million new homes over the next 20 years (approximately 55,000 per year) to keep pace with demand, although the state has been building roughly 35,000 housing units annually over the past decade. The market is characterized by high demand, limited housing supply, and elevated home prices.

Commercial Real Estate Lending Market (Washington State)

While a precise overall market size for commercial real estate (CRE) lending specifically in Washington State is not readily available, the national CRE mortgage borrowing and lending market was estimated to be $498 billion in 2024. Multifamily properties constituted a significant portion of this national lending, with an estimated $326 billion in total lending. Washington State's economy is robust and diverse, which contributes to increased demand for commercial real estate, particularly in metropolitan areas like Seattle and Bellevue. The multifamily market in Washington, for example, has shown strong demand and low vacancy rates. Financing options for various commercial property types, including multifamily, industrial, retail, office, and self-storage, are available through traditional bank loans and other sources.

Deposit Market (Washington State)

As of June 30, 2024, the total deposits for all FDIC-insured institutions in Washington State amounted to approximately $23.26 billion. More specifically, the Seattle-Tacoma-Bellevue metropolitan area alone accounted for $140,852 million in deposits as of the second quarter of 2025. This represents the overall pool of funds available for banking institutions within the state.

Consumer Lending Market (Washington State)

Information on the specific addressable market size for consumer loans (such as personal lines of credit, credit cards, automobile, and other personal loans) for Washington State is not distinctly quantified in the provided search results. Therefore, the market size for this product cannot be precisely identified.

FS Bancorp (NASDAQ: FSBW) is expected to drive future revenue growth over the next 2-3 years through several key areas, primarily centered around its core banking operations and strategic lending initiatives:

1. Loan Portfolio Expansion: The company has shown consistent growth in its total loans receivable, net, and diversifies its lending across commercial, construction, and residential segments. FS Bancorp explicitly states operating lending programs for home buyers, local contractors, builders, mortgage companies, and boat dealerships, indicating a broad approach to expanding its loan book.

2. Deposit Growth: A critical driver for any bank, strong deposit growth positions FS Bancorp to fund its loan pipeline. The company’s President/CFO highlighted that deposit growth exceeded expectations in Q1 2025, preparing the bank for future lending activities.

3. Growth within Commercial and Consumer Banking Segments: As one of its primary operating segments, the continued organic growth in Commercial and Consumer Banking through customer acquisition and increased utilization of services within its established network of 27 bank branches and several loan production offices across Washington and Oregon will contribute significantly to revenue.

4. Strategic Focus on Home Lending: The Home Lending segment is identified as a contributor to net income, with a dedicated focus on providing lending programs for home buyers, contractors, and builders. Continued strength and potential expansion in this specialized area are anticipated to be a revenue driver.

Share Repurchases

• FS Bancorp announced a new share repurchase program on October 27, 2025, authorizing up to $5.0 million of its common stock to be repurchased over a 12-month period until October 27, 2026.
• On July 9, 2025, an additional share repurchase program of up to $5.0 million was authorized, running for 12 months until July 9, 2026, with approximately $400,000 remaining from a previous plan announced on April 4, 2025.
• A $5.0 million share repurchase program announced on November 15, 2024, was completed, and a new $5.0 million program was authorized to be effective until October 31, 2025.

Capital Expenditures

• Capital expenditures for FS Bancorp were -$1.64 million, -$1.67 million, -$1.55 million, -$1.98 million, and -$1.38 million in recent quarters, reflecting purchases of fixed assets, acquisition of intangibles, and software development costs.
• The company's capital expenditure (TTM) was reported as $2.65 million.