First United Corporation (FUNC): Business Model Canvas [Dec-2025 Updated]

You're looking to cut through the noise and see exactly how First United Corporation is making money, especially with their $2.0 billion asset base as of Q1 2025. Honestly, their model isn't just about lending; it's a tight integration of relationship-focused community banking, wealth management, and insurance, all while maintaining a solid Net Interest Margin of 3.69% through Q3 2025. We've mapped out their entire nine-block strategy-from their $18.7 million net income for the first nine months of 2025 to their key partnerships-so you can see the levers driving their stability. Dive in below for the precise breakdown of their Key Resources and Revenue Streams.

First United Corporation (FUNC) - Canvas Business Model: Key Partnerships

You're looking at the external relationships First United Corporation relies on to keep the lights on and the balance sheet stable as of late 2025. These aren't just vendors; they are critical links in the funding, operational, and service delivery chain.

For funding stability, brokered deposit networks are a key lever. For instance, First United Corporation secured $50.0 million in new brokered time deposits in January 2025. This funding carried an average interest rate of 4.24% at that time, and it was specifically used to pay down $50.0 million in overnight borrowings outstanding at the end of 2024. This shows a direct, tactical partnership for managing short-term liquidity needs.

The technology backbone requires strong vendor alignment. First United Bank utilizes several advanced technology platforms to support its operations and digital experience.

In the insurance segment, First United Bank & Trust partners with specific carriers for employee benefits and its broader insurance offerings through Unity Insurance Partners. These relationships ensure the delivery of tailored personal and business insurance solutions across Oklahoma and Texas.

• Long-Term Disability (LTD) coverage is provided through American United Life Insurance Company (AUL).
• Health Insurance PPO network discounts utilize Aetna, with Meritain serving as the claims processor.
• Unity Insurance Partners positions itself as a Spend Life Wisely® Company, expanding offerings in commercial property, casualty, and employee benefits.

Community engagement and brand building are cemented through specific, long-term investment partnerships, particularly in affordable housing, which is a core part of the bank's community commitment. These are not simple donations; they are structured financial partnerships.

First United Corporation, through its Bank subsidiary, maintains significant interests in entities focused on local development:

• Liberty Mews Limited Partnership: Holds a 99.9% interest for acquiring, developing, and operating low-income housing units in Garrett County, Maryland.
• MCC FUBT Fund, LC: Holds a 99.9% non-voting membership interest for acquiring, developing, and operating low-income housing units in Allegany County, Maryland.

The bank also emphasizes broad community support, noting over $1.6 million in philanthropic contributions in 2024, and actively collaborates with schools and community organizations to foster financial literacy.

First United Corporation (FUNC) - Canvas Business Model: Key Activities

You're looking at the core engine room of First United Corporation (FUNC) as of late 2025. These are the daily, quarterly, and strategic actions that drive the business, grounded in their Q3 2025 performance snapshot. Honestly, the focus is clearly on managing the interest rate environment and keeping the balance sheet active.

Maintaining a strong net interest margin (NIM of 3.69% in Q3 2025) is central. This margin expansion is what's really fueling the bottom line, showing they are successfully repricing assets faster than liabilities are repricing against them. The NIM for the first nine months of 2025 stood at a solid 3.64%.

Here's a quick look at the profitability driver for the third quarter of 2025:

Loan origination and portfolio management (commercial and residential) remains a high-volume activity, though payoffs are a factor. You have to watch the gross production versus the net change. For the third quarter of 2025, the origination numbers were:

• Commercial loan originations: $29.8 million.
• Residential mortgage originations: $20.8 million.
• Commercial loan pipeline: A strong $50.4 million.

On the funding side, deposit gathering and funding cost control is a constant push. Deposits grew year-to-date through September 30, 2025. Deposits increased by $104.1 million Year-to-Date, bringing the total to $1.68 billion. Interest expense on deposits in Q3 2025 rose by $0.2 million compared to Q2 2025, reflecting that $21.9 million increase in average balances.

Wealth management and trust service delivery contributes to non-interest income. While specific Q3 2025 fee revenue isn't detailed here, the activity is noted as a driver of growth, with wealth management income increasing in Q2 2025 due to higher market valuations and expanded client relationships. This service line is a key part of their strategy to diversify revenue away from pure lending spread.

Finally, Investment in enhanced electronic banking technology is a stated strategic focus for 2025. In Q1 2025, management signaled intent to invest in technology, specifically around the electronic banking experience, which was expected to result in higher data processing expenses over the year. This is a forward-looking activity designed to support future customer acquisition and retention.

Finance: draft 13-week cash view by Friday.

First United Corporation (FUNC) - Canvas Business Model: Key Resources

When you look at First United Corporation (FUNC), the resources underpinning its business model are centered on a solid balance sheet, a physical footprint in its markets, and human/technological capital. These are the tangible and intangible assets that let the bank execute its strategy.

Financial capital base is definitely a core strength. As of the first quarter of 2025, Total Assets stood at $2.0 billion. By the third quarter of 2025, total assets remained at $2.0 billion, showing stability despite market movements. The composition of that asset base saw movement; for instance, the investment portfolio increased by $8.9 million in the first nine months of 2025 as they locked in yield. This resource base supports lending and investment activities.

Here's a quick look at some of the key financial and operational metrics that define this resource base as of late 2025 reporting periods:

The physical branch network provides the essential local presence for relationship banking. While the outline suggests approximately 26 offices, the latest anniversary report noted the bank operates 22 branches across Maryland and West Virginia counties as of mid-2025. You also gain access to a wider physical footprint through partnerships.

The physical access points include:

• Network of community offices in Maryland and West Virginia.
• Access to tens of thousands of ATMs via the MoneyPass Network.

For relationship-driven segments like commercial and wealth, experienced relationship managers are critical. While a precise count isn't public, the total human capital base is substantial, with the organization employing more than 300 associates as of June 2025. Furthermore, the CEO indicated plans to invest in strategic hires moving forward in 2025, suggesting an active effort to bolster this resource.

The proprietary and licensed banking technology infrastructure is the backbone for modern service delivery. The bank recognizes this is an area for investment; management explicitly stated intentions to enhance technology, particularly around the electronic banking experience, in 2025. This investment is a necessary resource to maintain competitive service levels against larger institutions.

Finally, the strong regulatory capital position ensures stability and operational flexibility. As of year-end 2024, which sets the baseline for 2025, the ratios were well above the minimums required, which is key for favorable regulatory treatment.

• Common Equity Tier 1 to risk weighted assets: 14.70%.
• Tier 1 Leverage: 12.79%.

Finance: draft 13-week cash view by Friday.

First United Corporation (FUNC) - Canvas Business Model: Value Propositions

First United Corporation delivers value through a combination of comprehensive financial services, a deep commitment to local relationships, and the proven stability of a long-standing institution.

Integrated financial solutions: banking, trust, and insurance services.

First United Bank & Trust provides a full suite of financial products, which includes trust, insurance, and investment services alongside commercial and retail banking. This integration supports the customer's entire financial lifecycle. The firm's operational efficiency, as shown by its non-GAAP efficiency ratio improving to 56.97% in the third quarter of 2025, helps maintain competitive pricing across these services. The focus on production across segments is evident in the third quarter of 2025 loan originations, with approximately $29.8 million in commercial loan originations and $20.8 million in residential mortgage originations.

Here's a quick look at the financial strength supporting these integrated offerings as of September 30, 2025:

Relationship-focused community banking with local decision-making.

The value proposition centers on being small enough to know you but large enough to customize solutions. This is supported by the fact that First United Corporation serves local communities in Maryland, West Virginia, Pennsylvania, and Virginia. The emphasis on relationship managers delivering production highlights this focus. For instance, year-to-date commercial production through September 30, 2025, reached approximately $139.0 million, which compares to $117.0 million for the same period in 2024, showing relationship efforts are driving growth.

The health of the loan book reflects careful local management:

• Non-accrual loans stood at $3.8 million as of September 30, 2025.
• Net charge-offs for 2025 year-to-date were low at 0.08% of average loans.
• The Allowance for Credit Losses (ACL) was $19.1 million at September 30, 2025.

Personalized guidance to help customers Spend Life Wisely.

The commitment to personalized guidance is tied to the firm's overall mission. The strong earnings performance in the first nine months of 2025, resulting in net income of $18.7 million, allows First United Corporation to return capital to shareholders, a tangible outcome of sound financial guidance. The Board declared a cash dividend of $0.26 per common share in the third quarter, demonstrating a commitment to shareholder value.

Stability and longevity as a century-old institution.

First United Corporation is positioned to offer stability, having celebrated its 125th anniversary in 2025. This longevity suggests a proven track record through various economic cycles. The capital strength backing this stability is reflected in the balance sheet improvements. The book value per share increased to $30.65 at September 30, 2025, up from $27.71 at December 31, 2024. Furthermore, the CET1 ratio improved to 13.68% and the Tier 1 RBC to 15.59% as of the third quarter end.

You're looking for a partner with staying power; the numbers show it.

First United Corporation (FUNC) - Canvas Business Model: Customer Relationships

You're looking at how First United Corporation (FUNC) keeps its customers close, which is clearly central to their strategy, especially as they celebrated their 125th anniversary in 2025. They aren't just a transactional bank; they aim to be a partner for life.

Dedicated, high-touch service from relationship managers.

The emphasis here is on personal connection, which is evident in their operational structure. The CEO noted in October 2025 that commercial, mortgage, and wealth relationship managers continue to deliver strong production, signaling this segment is a key driver of recent success. The Relationship Banker role is designed to be the single point of contact for customers, focused on understanding needs and mentoring others to do the same. Financial Center Managers also carry accountability for expanding the existing customer base and driving the service culture. This suggests a deliberate strategy to maintain high-touch service even while investing in technology.

Long-term, defintely loyal customer relationships.

First United Bank & Trust explicitly states a commitment to building lifelong, multigenerational relationships. Their longevity, tracing back to 1900, underpins this claim, with success being 'deeply connected to the prosperity of the people and places we serve'. Evidence of this relationship strength shows up in deposit growth; savings and money market accounts grew by $42.0 million in the first nine months of 2025, directly attributed to the expansion of current and new relationships. Furthermore, total deposits grew by $104.1 million when compared to December 31, 2024, as of September 30, 2025.

Here's a quick look at the scale of the business supporting these relationships as of late 2025:

Automated self-service via digital and mobile channels.

While the high-touch model is clear, First United Corporation is actively balancing this with digital investment. The CEO indicated plans to 'invest in strategic hires and enhanced technology, particularly around the electronic banking experience' during 2025. This aligns with the broader industry trend where customers expect seamless online and mobile banking experiences. The goal is to blend tradition with innovation, investing in modern tools while honoring core values.

Community-centric engagement and support.

The bank's roots are firmly in its local communities across Maryland, West Virginia, Pennsylvania, and Virginia. This community focus is a core part of their relationship strategy, not just a side project. They actively support local nonprofits, work to foster financial literacy across all ages, and encourage employee volunteerism. This engagement is viewed as a way to strengthen the social fabric and make a tangible difference in the places they operate.

The relationship approach is summarized by their values:

• Build helpful relationships that last a lifetime.
• Model helpfulness and yield to the customer.
• Nurture trust and keep it personal.
• Focus on the prosperity of the people and places served.

Finance: draft 13-week cash view by Friday.

First United Corporation (FUNC) - Canvas Business Model: Channels

You're looking at how First United Corporation (FUNC) gets its value proposition to the customer, and it's a mix of old-school presence and digital upgrades. The physical footprint is still key for their community banking focus.

Physical branch locations across four states (MD, WV, PA, VA)

First United Corporation serves its local communities and community-oriented business owners across a defined geographic footprint. The bank's physical presence spans operations in Maryland, West Virginia, Pennsylvania and Virginia. This network supports the core Community Banking segment.

Online and mobile banking platforms

The commitment to modernizing client access is clear in their strategic plans. First United Corporation plans to invest in technology improvements, specifically targeting electronic banking enhancements to improve efficiencies long-term and enhance the customer experience.

Commercial and wealth management sales teams

The activity of the sales teams, which drive significant fee income and loan production, provides concrete numbers on channel effectiveness. For instance, wealth management income showed growth, increasing by $0.2 million in the third quarter of 2025 compared to the third quarter of 2024, reflecting higher market valuations and expanded client relationships. This channel also saw an increase of $0.1 million in the second quarter of 2025 versus the second quarter of 2024. Loan production, a direct result of sales efforts, was notable:

The commercial loan originations in the second quarter of 2025 hit $65.1 million. The residential mortgage originations for the same period were $19.2 million. These figures show the direct financial output of the relationship managers.

Automated Teller Machines (ATMs)

I couldn't find a specific, verified unit count for First United Corporation's ATMs as of late 2025 in the latest reports. Finance: draft 13-week cash view by Friday.

First United Corporation (FUNC) - Canvas Business Model: Customer Segments

You're looking at the core groups First United Corporation serves, which really boils down to who holds their money and who borrows it. As a seasoned analyst, I see their focus clearly split between Main Street and local businesses, supported by a growing wealth management arm.

The primary customer base is segmented across four key areas, reflecting the Community Banking and Wealth Management operations First United Corporation runs. The data from their third quarter 2025 results gives us a clear picture of where the money is coming from and where the production focus lies.

Retail consumers and families in local communities.

This group drives the core deposit base. Since December 31, 2024, total deposits for First United Corporation grew by $104.1 million as of September 30, 2025. Within this, retail consumer activity is evident:

• Savings and money market accounts saw an increase of $42.0 million through the first nine months of 2025.
• Retail time deposits grew by $9.7 million over the same period.
• The bank also secured $50.0 million in new brokered time deposits in January 2025, which is a funding source supporting these relationships.

Residential mortgage originations in the third quarter of 2025 totaled $20.8 million, showing direct service to families purchasing homes.

Small-to-mid-sized businesses and commercial clients.

This segment is crucial for loan growth and fee income. Commercial loan originations were strong in the third quarter of 2025, hitting $29.8 million. The loan portfolio composition as of September 30, 2025, shows a significant commitment to this sector, with Commercial and industrial loans standing at $1,012,610 thousand.

Fluctuations in business deposits also point to this segment's activity. Non-interest-bearing checking deposits increased by $3.2 million since the end of 2024, though interest-bearing checking deposits decreased by $0.8 million, which the company attributed partly to seasonal fluctuations in commercial account balances. Honestly, watching those non-interest-bearing balances is a good proxy for commercial operating cash flow.

High-net-worth individuals requiring trust and investment services.

This is the dedicated Wealth Management segment. The focus here is on growing assets under administration, which translates directly into non-interest income. For the first nine months of 2025, wealth management income increased by $0.2 million compared to the same period in 2024. Furthermore, in the third quarter of 2025 compared to the third quarter of 2024, other operating income saw a $0.2 million bump, driven primarily by increases in wealth management income, reflecting higher market valuations and expanded relationships.

First United Corporation offers personal trust, investment agency accounts, charitable trusts, and estate administration services to these clients.

Not-for-profit organizations.

While not explicitly detailed with dedicated financial metrics in the recent reports, this group is implicitly served through the broader commercial and retail banking structure. The mention of seasonal fluctuations in municipal account balances impacting non-interest-bearing checking deposits suggests that local government and related not-for-profit entities are part of the deposit base that experiences cyclical cash movements.

The Bank also has specific, though minor, investments in community development through its ownership interests in partnerships formed for acquiring, developing, and operating low-income housing units in Garrett County, Maryland, and Allegany County, Maryland.

Here's a quick look at the scale of the operation supporting these segments as of September 30, 2025, based on the bank-level data:

The total assets for the bank entity were $16,454,964 thousand at that date.

Finance: draft 13-week cash view by Friday.

First United Corporation (FUNC) - Canvas Business Model: Cost Structure

The cost structure for First United Corporation (FUNC) is heavily influenced by funding costs, personnel, and operational overhead necessary to support its banking franchise.

Interest expense on deposits and borrowings showed movement in the first nine months of 2025, increasing by $0.6 million year-to-date compared to the same period in 2024. This increase was primarily driven by a $1.2 million rise in interest on deposits, linked to growth in municipal balances. This was partially offset by a net reduction in borrowing costs of $0.7 million following the repayment of Federal Home Loan Bank (FHLB) BTFP balances late in the third quarter of 2024. Comparing the third quarter of 2025 to the linked second quarter of 2025, interest expense increased by $0.2 million, entirely attributable to a $0.2 million increase in interest paid on deposits.

Personnel costs are a significant component, with First United Corporation operating with 309 employees as of the latest profile data. For the third quarter of 2025, salaries and benefit expenses increased by $0.4 million compared to the third quarter of 2024, alongside increases in professional services and data processing costs contributing to the overall rise in other operating expenses for that quarter.

Here's a look at some key cost components based on recent reporting periods:

You need to keep an eye on the variable costs that shift with operations and technology investment. Specifically:

• Technology and data processing costs increased by $0.2 million in the third quarter of 2025 compared to the linked quarter of 2024.
• For comparison, in the fourth quarter of 2024, data processing expenses increased by $0.4 million due to core processing system costs and software agreements.
• Occupancy and equipment expenses decreased by $0.3 million when comparing the fourth quarter of 2024 to the third quarter of 2024.

The Provision for Credit Losses for the quarter ended September 30, 2025, was reported at $0.5 million. This compares to a provision of $0.3 million for the same quarter in 2024 and $0.9 million for the second quarter of 2025. Finance: draft 13-week cash view by Friday.

First United Corporation (FUNC) - Canvas Business Model: Revenue Streams

You're looking at how First United Corporation converts its operations into actual money coming in, which is the core of its revenue streams as of late 2025. Honestly, for a bank holding company like First United Corporation, the story is heavily weighted toward its lending and investment activities.

The primary engine is Net Interest Income from loan and investment portfolios. For the first nine months of 2025, this stream saw a significant boost, increasing by $5.8 million compared to the same period in 2024. This growth was fueled by a $6.4 million increase in interest income, largely because loans repriced at higher rates and new production was booked at better rates. The Net Interest Margin (NIM), on a non-GAAP, fully tax equivalent (FTE) basis, hit 3.69% for the third quarter of 2025, up from 3.34% for the nine-month period ending September 30, 2024. That margin expansion is key to profitability. That's how you make money in banking right now.

Here's a quick look at the revenue picture for the third quarter of 2025, based on reported figures:

Next up, you have the fee-based income, which provides important diversification. Fees from wealth management and trust services contributed to the overall non-interest income growth. Specifically, wealth management income in the third quarter of 2025 increased by $0.2 million when compared to the third quarter of 2024, reflecting higher market valuations and expanded client relationships. You can see this focus on growing those relationships, which is smart.

The category for Non-interest income from service charges and insurance products is captured within the broader 'Other operating income.' Overall, this component for First United Corporation increased by $0.3 million in the third quarter of 2025 versus the third quarter of 2024. While the exact breakdown for service charges versus insurance isn't itemized separately in the latest release, the overall fee income performance was described as solid.

For the specific revenue line item of Gains on sales of residential mortgages, the third quarter of 2025 recognized $0.1 million in net gains from the sale of available-for-sale investments. This is a component of the non-interest income that fluctuates based on market activity and origination volume.

Finally, the bottom line for the period that ties all these streams together is the Net income for the first nine months of 2025, which was reported as $18.7 million. This compares favorably to the $14.4 million earned over the same period in 2024. That's a clear indicator that the revenue generation strategy is working better this year.

• Net Interest Income increased by $5.8 million for the nine months ended September 30, 2025.
• Wealth management income rose by $0.2 million in Q3 2025 year-over-year.
• Other operating income (including net gains) grew by $0.3 million in Q3 2025 year-over-year.
• Net income for the first nine months of 2025 reached $18.7 million.

Finance: draft 13-week cash view by Friday.