What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2026-05-07 compared with 2025-11-10 · 325 added, 429 removed, 522 unchanged (59% of the section changed)

2 unchanged sentences

The following discussion and analysis should be read in conjunction with the consolidated financial statements and related notes and with the statistical information and financial data appearing in this report as well as the Company's 2025 Annual Report on Form 10-K.

Results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of results to be attained for any other period.

Pending Acquisition

On June 16, 2025, the Company and FineMark Holdings, Inc.

("FineMark") announced they entered into a definitive merger agreement ("Merger Agreement") in which the Company will acquire all outstanding shares of FineMark in an all-stock transaction ("Merger").

Immediately after the merger, FineMark's wholly-owned subsidiary, FineMark National Bank & Trust will merge into the Bank ("Bank Merger").

FineMark is headquartered in Fort Meyers, Florida and has 13 banking offices in Florida, Arizona, and South Carolina.

As of June 30, 2025, FineMark disclosed that it had total assets of $3.9 billion (including $2.6 billion in loans), $3.5 billion of total liabilities (including $3.1 billion in deposits), and $373 million of total shareholders' equity.

Under the terms of the agreement, the shareholders of FineMark will receive a fixed exchange ratio of .690 shares of Company common stock for each share of FineMark common stock.

The transaction is valued at approximately $585 million (with the price based on the closing price of the Company's common shares as of June 13, 2025, the last trading day before the public announcement of the merger).

The transaction has been approved by the Federal Reserve Bank of Kansas City, the Missouri Division of Finance, and FineMark shareholders.

The transaction remains subject to customary closing conditions and is anticipated to close on January 1, 2026.

In connection with the acquisition, the Company incurred merger-related expenses consisting predominantly of professional services for investment banking, legal, and other services associated with the pending transaction that totaled $3.1 million through the third quarter of 2025.

Results of operations for the three months ended March 31, 2026 are not necessarily indicative of results to be attained for any other period.

On January 1, 2026, the Company completed its previously announced acquisition of FineMark Holdings, Inc.

("FineMark"), a bank holding company headquartered in Fort Myers, Florida, pursuant to the Agreement and Plan of Merger dated June 16, 2025.

Immediately after the merger, FineMark's wholly-owned subsidiary, FineMark National Bank & Trust, merged into the Bank, with the Bank continuing as the surviving bank.

The acquisition added total assets of approximately $3.9 billion, including loans of $2.7 billion, total deposits of $3.1 billion, and assets under administration of $8.7 billion, as well as 13 banking offices in Florida, Arizona and South Carolina.

Visa Class B-2 common shares exchange offer

On April 13, 2026, Visa, Inc.

(“Visa”) announced the commencement of a public offering to exchange Class B-2 common stock for a combination of shares of Class B-3 common stock and Class C common stock (“2026 Exchange Offer”).

The Company tendered all of its Visa Class B-2 shares and is awaiting notification of acceptance of that tender and the closing of the 2026 Exchange Offer.

If the Company’s tendered shares are accepted and the exchange occurs in the second quarter of 2026, the Company expects to record a significant gain during the second quarter of 2026 based on the conversion privilege of the Class C common stock and the closing price of Visa Class A common stock.

A full description of the terms of the 2026 Exchange Offer is set forth in Visa’s related Issuer Tender Offer Statement on Schedule TO and Prospectus, each dated April 6, 2026, publicly filed with the U.

Securities and Exchange Commission.

As described in Note 4 "Investment Securities," the Company previously entered into a Makewhole Agreement with Visa related to its participation in the 2024 Exchange Offer.

In order to continue preserving the economic benefit of those same adjustments for Visa's Class A and Class C common stockholders in relation to the Class B-2 and Class B-3 conversion ratios following the 2026 Exchange Offer, and as a condition of participating in the 2026 Exchange Offer, the Company entered into a Makewhole Agreement (2026 Makewhole Agreement) with Visa that provides for similar cash payments to Visa under the same circumstances as described above for the 2024 Makewhole Agreement.

As further described in Visa’s related Issuer Tender Offer Statement on Schedule TO and Prospectus, each dated April 13, 2026, publicly filed with the U.

Securities and Exchange Commission, both the 2026 Makewhole Agreement and the related escrow fund and transfer restrictions on Visa’s Class B-2 common stock and the new Class B-3 common stock will terminate whenever the covered litigation is ultimately resolved, at which future date outstanding shares of Visa Class B-3 common stock will be convertible into shares of its Class A common stock at the then-applicable conversion ratio.

The 2026 Makewhole Agreement also includes limited transfer restrictions, such that the Company may only transfer up to one-third of the shares of Visa Class C common stock received in the exchange within the first 45 days following the 2026 Exchange Offer acceptance date, and may only transfer up to two-thirds of the Class C common stock received within the first 90 days following the 2026 Exchange Offer acceptance date.

Additionally, if the Company’s tendered shares are accepted and the exchange occurs in the second quarter of 2026, the Company may consider a plan to reposition a portion of its available for sale debt securities portfolio through the sale of securities, which may result in a significant loss during the second quarter of 2026.

The timing and amount of the loss ultimately realized on the available for sale debt securities and the reinvestment assumptions may depend on many considerations, including market conditions, the amount of the gain recognized on the conversion privilege of the Visa shares, and other factors.

Forward-Looking Information

5 unchanged sentences

Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in, or implied by, such forward-looking statements.

Readers should not rely solely on the forward-looking statements and should consider all uncertainties and risks discussed throughout this report.

Readers should not rely solely on the forward-looking statements and should consider all uncertainties and risks discussed

throughout this report.

Forward-looking statements speak only as of the date they are made.

7 unchanged sentences

demand for loans in the Company's market area;

changes in accounting and tax principles, estimates made on income taxes, competition with other entities that offer financial services, cybersecurity threats;

risks related to the proposed Merger with FineMark including, among others, (i) failure to complete the Merger or unexpected delays related to the merger or either party’s inability to satisfy closing conditions required to complete the Merger, (ii) certain restrictions during the pendency of the proposed Merger that may impact the parties’ ability to pursue certain business opportunities or strategic transactions, (iii) diversion of management’s attention from ongoing business operations and opportunities, (iv) cost savings and any revenue synergies from the Merger may not be fully realized or may take longer than anticipated to be realized, (v) deposits attrition, customer or employee loss and/or revenue loss as a result of the proposed Merger, and (vi) expenses related to the proposed Merger being greater than expected;

changes in accounting and tax principle;, estimates made on income taxes;

competition with other entities that offer financial services;

cybersecurity threats;

risks related to the merger with FineMark including, among others, (i) the Company's ability to promptly and effectively integrate the merger, (ii) diversion of management’s attention from ongoing business operations and opportunities, (iii) cost savings and any revenue synergies from the merger may not be fully realized or may take longer than anticipated to be realized, (iv) deposits attrition, customer or employee loss and/or revenue loss as a result of the merger, and (v) expenses related to the merger being greater than expected;

and such other factors as discussed in Part I Item 1A - "Risk Factors" and Part II Item 7 - "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's 2025 Annual Report on Form 10-K and Part II, Item 1A.

2 unchanged sentences

The Company has identified certain policies as being critical because they require management to make particularly difficult, subjective and/or complex judgments about matters that are inherently uncertain and because of the likelihood that materially different amounts would be reported under different conditions or using different assumptions.

These estimates and

related policies are the Company's allowance for credit losses and fair value measurement policies.

These estimates and related policies are the Company's allowance for credit losses and fair value measurement policies.

A discussion of these estimates and related policies can be found in the sections captioned "Critical Accounting Policies" and "Allowance for Credit Losses on Loans and Liability for Unfunded Lending Commitments" in Management's Discussion and Analysis of Financial Condition and Results of Operations included in the Company's 2025 Annual Report on Form 10-K.

1 unchanged sentence

Selected Financial Data

Three Months Ended September 30 Nine Months Ended September 30

2025 2024 2025 2024

Three Months Ended March 31

Per Share Data

10 unchanged sentences

Equity to loans (1)

21.03 19.18 20.23 18.02

Equity to deposits 15.69 13.57

4 unchanged sentences

Non-interest income to revenue (2)

36.63 37.74 36.97 37.30

Efficiency ratio (3)

55.26 56.31 55.21 57.92

Tier I common risk-based capital ratio 17.09 16.86

24 unchanged sentences

Results of Operations

Three Months Ended September 30 Nine Months Ended September 30

(Dollars in thousands) 2025 2024 % change 2025 2024 % change

Three Months Ended March 31 Increase (Decrease)

(Dollars in thousands) 2026 2025 Amount % change

Net interest income (expense) $ 299,840 $ 269,102 $ 30,738 11.4 %

2 unchanged sentences

Investment securities gains (losses), net 11,647 (7,591) 19,238 N.M.

731 6,846 (89.3)

Non-interest expense (291,126) (238,376) 52,750 22.1

Income taxes (40,881) (36,964) 3,917 10.6

Non-controlling interest income (expense) (2,104) (2,256) (6.7) (2,429) (6,934) (65.0)

Non-controlling interest income (expense) (2,748) 959 3,707 N.M.

Net income attributable to Commerce Bancshares, Inc.

$ 141,623 $ 131,592 10,031 7.6

For the quarter ended September 30, 2025, net income attributable to Commerce Bancshares, Inc.

(net income) amounted to $141.5 million, an increase of $3.5 million, or 2.5%, compared to the third quarter of the previous year.

- Not meaningful.

For the quarter ended March 31, 2026, net income attributable to Commerce Bancshares, Inc.

(net income) amounted to $141.6 million, an increase of $10.0 million, or 7.6%, compared to the first quarter of the previous year.

For the current quarter, the annualized return on average assets was 1.62%, the annualized return on average equity was 13.22%, and the efficiency ratio was 60.00%.

Diluted earnings per common share was $1.06 per share in the current quarter, an increase of 5.0% compared to $1.01 per share in the third quarter of 2024, and decreased 7.0% compared to $1.14 per share in the previous quarter.

Compared to the third quarter of last year, net interest income increased $17.1 million, or 6.5%, mainly due to increases in interest income on investment securities and securities purchased under agreements to resell ("resale agreements") of $11.8 million and $4.4 million, respectively, partly offset by a decrease in interest income on loans of $6.2 million.

Interest expense on deposits and interest expense on borrowings also decreased $10.9 million and $4.2 million, respectively.

The provision for credit losses increased $10.9 million compared to the same quarter in the prior year.

Non-interest income increased $2.5 million, or 1.6%, compared to the third quarter of 2024, mainly due to increases in trust fees, brokerage fees and deposit account fees of $3.7 million, $2.1 million, and $2.0 million, respectively.

These increases were partly offset by a decrease in bankcard fee income and a decrease in capital market fees of $2.0 million and $857 thousand, respectively.

Net gains on investment securities totaled $7.9 million in the current quarter compared to net gains of $3.9 million in the same quarter of last year.

Diluted earnings per common share was $.96 per share in the current quarter, an increase of 3.2% compared to $.93 per share in the first quarter of 2025, and decreased 5.0% compared to $1.01 per share in the previous quarter.

Compared to the first quarter of last year, net interest income increased $30.7 million, or 11.4%, mainly due to increases in interest income on loans and securities purchased under agreements to resell (“resale agreements”) of $34.2 million and $1.0 million, respectively, partly offset by a decrease in interest income on investment securities of $4.2 million.

Interest expense on deposits increased $4.1 million, while interest expense on borrowings decreased $2.7 million.

The provision for credit losses decreased $3.5 million compared to the same quarter in the prior year.

Non-interest income increased $16.9 million, or 10.6%, compared to the first quarter of 2025, mainly due to increases in trust fees, deposit account fees and brokerage fees of $14.5 million, $2.0 million and $659 thousand, respectively.

Net gains on investment securities totaled $11.6 million in the current quarter compared to net losses of $7.6 million in the same quarter of last year.

Securities gains in the current quarter primarily resulted from net gains in fair value of $10.9 million recorded on private equity investments.

Non-interest expense increased $6.4 million, or 2.7%, over the third quarter of 2024, mainly due to higher salaries expense, professional and other services expense, and data processing and software expense of $4.3 million, $2.5 million, and $1.2 million, respectively, partly offset by non-recurring litigation settlement expense during the third quarter of the prior year.

Net income for the first nine months of 2025 totaled $425.6 million, an increase of $35.4 million, or 9.1% from the same period last year.

Diluted earnings per common share was $3.18, an increase of 11.2% compared to $2.86 per share in the same period last year.

For the first nine months of 2025, the annualized return on average assets was 1.81%, the annualized return on average equity was 16.15% and the efficiency ratio was 55.21%.

Net interest income increased $55.1 million, or 7.1%, over the same period last year.

This growth was largely due to increases in interest income on investment securities and securities purchased under agreements to resell ("resale agreements") of $31.5 million and $16.2 million, respectively, partly offset by a decrease in interest income on loans of $23.7 million.

Interest expense on deposits and interest expense on borrowings also decreased $31.2 million and $14.0 million, respectively, over the same period last year.

The provision for credit losses was $40.1 million for the first nine months of 2025, compared to a provision of $19.4 million in the same period last year.

Non-interest income increased $26.0 million, or 5.6%, from the first nine months of last year largely due to increases in trust fees, deposit fees, and brokerage fees of $12.5 million, $5.4 million, and $3.4 million, respectively.

Non-interest expense increased $11.3 million, or 1.6%, over the first nine months of last year mainly due to increases in salaries and benefits expense and professional and other services expense of $11.5 million and $8.2 million, respectively, partly offset by non-recurring litigation settlement expense of $10 million and non-recurring charitable donations of $5.0 million during the prior year.

Non-interest expense increased $52.8 million, or 22.1%, over the first quarter of 2025, mainly due to higher salaries and benefits expense of $27.7 million, primarily a result of onboarding FineMark team members and acquisition-related compensation payments.

Professional and other services expense increased $8.8 million, which included $4.7 million in acquisition-related legal and professional services expense.

Other non-interest expense increased $6.4 million, primarily due an increase of $5.4 million in intangible amortization expense related to the FineMark acquisition.

Data processing expense expense increased $5.1 million compared to the same quarter of last year.

Net Interest Income

2 unchanged sentences

Analysis of Changes in Net Interest Income

Three Months Ended September 30, 2025 vs.

2024 Nine Months Ended September 30, 2025 vs.

Change due to Change due to

Three Months Ended March 31, 2026 vs.

Change due to

(In thousands) Average

Volume Average

Total Average

Volume Average

Interest income, fully taxable-equivalent basis:

10 unchanged sentences

Investment securities:

government and federal agency securities 7,461 2,608 10,069 36,990 7,694 44,684

government and federal agency obligations 6,090 (3,799) 2,291

Government-sponsored enterprise obligations (3) (1) (4)

19 unchanged sentences

Net interest income, fully taxable-equivalent basis $ 36,490 $ (5,702) $ 30,788

Net interest income in the third quarter of 2025 was $279.5 million, an increase of $17.1 million over the third quarter of 2024.

On a fully taxable-equivalent (FTE) basis, net interest income totaled $281.8 million in the third quarter of 2025, up $17.1 million over the same period last year and down $658 thousand from the previous quarter.

The increase in net interest

income compared to the third quarter of 2024 was mainly due to higher interest income earned on investment securities (FTE) of $11.7 million and lower deposit interest expense of $10.9 million, partly offset by lower interest income earned on loans (FTE) of $6.1 million and deposits at the Federal Reserve of $7.9 million.

The increase in total interest earned on investment securities (FTE) was mainly the result of higher average balances and rates earned on U.S.

government and federal agency securities and higher average rates earned on asset-backed securities.

The decrease in deposit interest expense was mainly due to lower average rates paid, while the decrease in interest earned on deposits at the Federal Reserve was mainly due to lower rates earned.

Interest income earned on loans (FTE) decreased mainly due to lower average rates, partly offset by higher average balances.

The Company's net yield on earning assets (FTE) was 3.64% in the current quarter compared to 3.50% in the third quarter of 2024.

Total interest income (FTE) increased $2.1 million over the third quarter of 2024.

Interest income on loans (FTE) was $265.6 million during the third quarter of 2025, a decrease of $6.2 million, or 2.3%, from the same quarter last year.

The decrease in loan interest income from the same quarter of last year was primarily due to a decline of 33 basis points in the average rate earned, partly offset by growth of $468.5 million, or 2.8%, in average loan balances.

Most of the decrease in interest income occurred in the construction and land, business and business real estate loan categories.

The largest decrease to interest income occurred in construction and land loan interest, which declined $3.8 million due to a 107 basis point decrease in the average rate earned.

Business loan interest income declined $2.7 million due to a 45 basis point decrease in the average rate earned, partly offset by higher average balances of $263.2 million, or 4.4%.

Business real estate loan interest income decreased $1.1 million due to a decrease of 36 basis points in the average rate earned, partly offset by higher average balances of $134.8 million, or 3.8%.

Consumer credit card loan interest income declined $938 thousand mainly due to an 80 basis point decrease in the average rate earned.

These decreases in interest income were partly offset by an increase in personal real estate loan interest income of $2.1 million mainly due to a 24 basis point increase in the average rate earned.

Interest income on investment securities (FTE) was $75.0 million during the third quarter of 2025, which was an increase of $11.7 million over the same quarter last year.

The increase in interest income occurred mainly in interest earned on U.S.

government and federal agency securities, which grew $10.1 million due to an $804.3 million increase in average balances and a 38 basis point increase in the average rate earned.

Net interest income in the first quarter of 2026 was $299.8 million, an increase of $30.7 million over the first quarter of 2025.

On a fully taxable-equivalent (FTE) basis, net interest income totaled $302.2 million in the first quarter of 2026, up $30.8 million over the same period last year and up $16.4 million over the previous quarter.

The increase in net interest income

compared to the first quarter of 2025 was mainly due to an increase in average loan balances in connection with the acquisition of FineMark on January 1, 2026.

Accretion income on FineMark's loans resulting from purchase accounting adjustments totaled $6.9 million.

Interest income earned on loans (FTE) increased over the same period in the prior year mainly due to higher average loan balances, partly offset by lower average rates earned.

The decrease in total interest earned on investment securities (FTE) was mainly the result of lower average rates earned on U.S.

government and federal agency obligations and lower average balances of asset-backed and mortgage-backed securities.

The increase in deposit interest expense was mainly due to higher average balances, partly offset by lower average rates paid.

Interest expense on securities sold under agreements to repurchase decreased mainly due to lower average rates paid.

The Company's net yield on earning assets (FTE) was 3.59% in the current quarter compared to 3.56% in the first quarter of 2025.

Total interest income (FTE) increased $32.2 million over the first quarter of 2025.

Interest income on loans (FTE) was $290.3 million during the first quarter of 2026, an increase of $34.3 million, or 13.4%, over the same quarter last year.

The increase in loan interest income over the same quarter of last year was primarily due to growth of $3.1 billion, or 18.0%, in average loan balances and higher average rates earned on personal real estate loans.

Most of the increase in interest income was due to the acquisition of FineMark, which added $2.7 billion in loan balances.

The largest increase to interest income occurred in personal real estate loan interest, which grew $20.4 million due to a $1.4 billion, or 45.0%, increase in average balances coupled with a 54 basis point increase in the average rate earned.

Revolving home equity loan interest income increased $4.6 million mainly due to a $252.4 million, or 70.4%, increase in average balances.

Business real estate loan interest income increased $4.2 million due to higher average balances of $377.8 million, or 10.3%, partly offset by a decrease of 13 basis points in the average rate earned.

The $3.6 million increase in consumer loan interest income was due to a $339.2 million, or 16.3%, increase in average balances, partly offset by a decline of 32 basis points in the average rate earned.

Business loan interest income grew $2.6 million due to higher average balances of $580.9 million, or 9.5%, partly offset by a 34 basis point decrease in the average rate earned.

Interest income on construction and land loans increased $402 thousand mainly due to growth in average balances of $177.0 million, or 12.5%, partly offset by a 71 basis point decrease in the average rate earned.

These increases in interest income were slightly offset by a decrease in consumer credit card loan interest income of $1.3 million mainly due to an 85 basis point decrease in the average rate earned.

Interest income on investment securities (FTE) was $72.8 million during the first quarter of 2026, which was a decrease of $4.3 million from the same quarter last year.

The largest decreases in interest income occurred in interest earned on asset-backed and mortgage-backed securities, which declined $2.9 million and $2.6 million, respectively.

Interest income earned on asset-backed securities declined due to a $454.5 million decrease in average balances, partly offset by a 34 basis point increase in the average rate earned.

A decrease of $577.0 million, or 12.1%, in average balances led to the decline in interest income on mortgage-backed securities.

In addition, the Company recorded a $940 thousand adjustment to premium amortization at March 31, 2026, which increased interest income and reflected slower forward prepayment speed estimates on mortgage-backed securities.

This increase was higher than the $539 thousand adjustment increasing income in the same quarter last year.

These decreases to interest income were partly offset by growth of $2.3 million in interest income on U.S.

government and federal agency obligations, driven by higher average balances of $603.9 million, or 23.3%, partly offset by a decline of 49 basis points in the average rate earned.

Interest income related to the Company's U.S.

Treasury inflation-protected securities, which is tied to the non-seasonally adjusted Consumer Price Index (CPI-U), increased $1.6 million over the same quarter last year.

Interest income earned on asset-backed securities grew $3.5 million due to a 103 basis point increase in the average rate earned, partly offset by a decrease in average balances of $58.8 million, or 3.9%.

Interest earned on other securities increased $1.0 million mainly due to the receipt of $1.3 million in non-accrual interest income from a private equity investment in the third quarter of 2025.

These increases to interest income were partly offset by a decline in interest income on mortgage-backed securities of $2.4 million, driven by lower average balances of $621.0 million, or 12.2%.

In addition, the Company recorded a $314 thousand adjustment to premium amortization at September 30, 2025, which increased interest income and reflected slower forward prepayment speed estimates on mortgage-backed securities.

This increase was higher than the $286 thousand adjustment decreasing income in the same quarter last year.

Interest income earned on state and municipal obligations declined $416 thousand mainly due to a $100.5 million, or 11.7%, decrease in average balances.

Additionally, the average rate earned on investment securities during the three months ended September 30, 2025 increased 47 basis points over the same period in the prior year.

The average balance of the total investment portfolio (excluding unrealized fair value adjustments on available for sale debt securities) was $10.0 billion in both the third quarters of 2025 and 2024.

Treasury inflation-protected securities, which is tied to the non-seasonally adjusted Consumer Price Index (CPI-U), decreased $3.1 million from the same quarter last year.

The average balance of the total investment portfolio (excluding unrealized fair value adjustments on available for sale debt securities) was $9.9 billion in the first quarter of 2026 and $10.5 billion in the first quarter of 2025.

Interest income on securities purchased under agreements to resell increased $1.0 million over the same quarter last year, due to an increase of 22 basis points in the average rate earned and growth of $61.1 million in the average balance.

Interest income on deposits at the Federal Reserve decreased $7.9 million due to declines of 98 basis points in average rate earned and $142.7 million in the average balance.

The average fully taxable-equivalent yield on total interest earning assets was 4.86% in the third quarter of 2025, down from 4.96% in the third quarter of 2024.

Total interest expense decreased $15.1 million compared to the third quarter of 2024 due to decreases of $10.9 million in interest expense on interest bearing deposits and $4.2 million in interest expense on borrowings.

The decrease in deposit interest expense resulted mainly from lower interest expense on certificates of deposit balances of $6.1 million due to an 81 basis point decline in the average rate paid and a decrease of $111.4 million, or 4.4%, in average balances.

Interest expense on interest checking and money market deposit accounts decreased $4.8 million due to a 20 basis point decline in average rates paid, partly offset by an increase of $498.4 million, or 3.8%, in average balances.

Interest income on deposits at the Federal Reserve increased $1.1 million due to an increase of $608.8 million in the average balance, partly offset by a decline of 76 basis points in the average rate earned.

The average fully taxable-equivalent yield on total interest earning assets was 4.74% in the first quarter of 2026, down from 4.81% in the first quarter of 2025.

Total interest expense increased $1.4 million compared to the first quarter of 2025 due an increase of $4.1 million in interest expense on interest bearing deposits, partly offset by a decrease of $2.7 million in interest expense on borrowings.

The increase in deposit interest expense was primarily due to the acquisition of FineMark, which added $2.7 billion in interest bearing deposit balances.

Compared to the same quarter last year, interest expense on interest checking and money market deposit balances increased $6.1 million due to growth of $2.1 billion, or 15.2%, in average balances, partly offset by a four basis point decline in the average rate paid.

Interest expense on certificate of deposit accounts decreased $2.1 million due to a 56 basis point decline in average rates paid, partly offset by an increase of $144.8 million, or 6.1%, in average balances.

The overall rate paid on total deposits decreased 11 basis points from the same quarter last year.

Interest expense on federal funds purchased decreased $1.4 million due to lower average balances of $76.0 million and a 104 basis point decline in the average rate paid.

Interest expense on customer repurchase agreements decreased $2.8 million due to a 68 basis point decline in the average rate paid, partly offset by

growth of $167.8 million, or 7.1%, in the average balance.

The overall average rate incurred on all interest bearing liabilities was 1.87% and 2.22% in the third quarters of 2025 and 2024, respectively.

Net interest income (FTE) for the first nine months of 2025 was $835.6 million compared to $780.5 million for the same period in 2024.

For the first nine months of 2025, the net interest margin was 3.63% compared to 3.46% for the same period in 2024.

Total interest income (FTE) for the first nine months of 2025 increased $9.9 million over the same period last year mainly due to higher interest income on investment securities (FTE) and securities purchased under agreements to resell, partly offset by lower interest income on loans (FTE) and deposit balances at the Federal Reserve.

Loan interest income (FTE) decreased $23.5 million, or 2.9%, due to a 29 basis point decrease in the average rate earned, partly offset by a $318.6 million, or 1.9%, increase in average loan balances.

The decrease in interest earned occurred in the construction and land, business real estate, business and consumer credit card loan categories, partly offset by an increase in interest income the personal real estate loan category.

Interest income on investment securities (FTE) increased $31.3 million mainly due to a 47 basis point increase in the average rate earned and an increase of $1.3 billion in average balances of U.S.

government and federal agency securities.

Interest earned on U.S.

government and federal agency securities increased $44.7 million due to higher average balances and an increase in the average rate earned, while interest earned on asset-backed securities increased $8.8 million due to higher average rates earned, partly offset by a decrease in average balances.

These increases in interest income on investment securities were partly offset by decreases in interest earned on mortgage-backed securities and state and municipal obligations of $14.6 million and $4.2 million, respectively, mainly due to decreases in average balances.

Interest earned on other securities decreased $3.4 million due to a decline in average balances.

Higher interest income of $16.2 million was earned on securities purchased under agreements to resell, which saw growth in both average balances and rates earned.

Interest income on balances at the Federal Reserve decreased $14.0 million due to a 101 basis point decline in the average rate earned, partly offset by an $80.3 million increase in the average balance invested.

Total interest expense for the first nine months of 2025 decreased $45.2 million compared to the same period last year.

Interest expense on deposits decreased $31.2 million, due to a 29 basis point decline in the average rate paid, partly offset by a $458.2 million increase in average balances.

Interest expense on borrowings decreased $14.0 million due lower interest expense on federal funds purchased of $6.6 million, resulting from lower average balances and rates, while interest expense on securities sold under agreements to repurchase declined $7.5 million due to lower average rates paid, partly offset by higher average balances.

The overall cost of total interest bearing liabilities decreased to 1.86% compared to 2.21% in the same period last year.

Interest expense on customer repurchase agreements decreased $3.4 million due to a 47 basis point decline in the average rate paid and a decrease of $48.7 million, or

1.8%, in the average balance.

The overall average rate incurred on all interest bearing liabilities was 1.72% and 1.89% in the first quarters of 2026 and 2025, respectively.

Summaries of average assets and liabilities and the corresponding average rates earned/paid appear on the last page of this discussion.

Non-Interest Income

Three Months Ended September 30 Increase (Decrease) Nine Months Ended September 30 Increase (Decrease)

(Dollars in thousands) 2025 2024 Amount % change 2025 2024 Amount % change

Three Months Ended March 31 Increase (Decrease)

(Dollars in thousands) 2026 2025 Amount % change

Trust fees $ 71,049 $ 56,592 $ 14,457 25.5 %

1 unchanged sentence

Deposit account charges and other fees 28,578 26,622 1,956 7.3

Capital market fees 5,138 5,995 (857) (14.3) 16,425 14,647 1,778 12.1

Consumer brokerage services 5,444 4,785 659 13.8

Capital market fees 5,338 5,112 226 4.4

Loan fees and sales 3,243 3,404 (161) (4.7)

3 unchanged sentences

* Total revenue includes net interest income and non-interest income.

The table below is a summary of net bank card transaction fees for the nine month periods ended September 30, 2025 and 2024.

Three Months Ended September 30 Nine Months Ended September 30

(Dollars in thousands) 2025 2024 $ change % change 2025 2024 $ change % change

The table below is a summary of net bank card transaction fees for the three month periods ended March 31, 2026 and 2025.

Three Months Ended March 31

(Dollars in thousands) 2026 2025 $ change % change

Net debit card fees $ 10,589 $ 10,288 $ 301 2.9 %

3 unchanged sentences

Total bank card transaction fees $ 45,585 $ 45,593 $ (8) — %

For the third quarter of 2025, total non-interest income amounted to $161.5 million compared to $159.0 million in the same quarter last year, which was an increase of $2.5 million, or 1.6%.

The increase was mainly due to higher trust fees, consumer brokerage service fees and deposit account fees.

For the first quarter of 2026, total non-interest income amounted to $175.9 million compared to $158.9 million in the same quarter last year, which was an increase of $16.9 million, or 10.6%.

The increase was mainly due to higher trust fees and deposit account fees.

Trust fees increased $14.5 million, or 25.5%, mainly due to growth of $13.5 million in private client trust fees.

Bank card transaction fees for the current quarter declined $2.0 million, or 4.2%, from the same period last year.

Net corporate card fees declined $1.7 million mainly due to higher rewards expense, partly offset by higher interchange income.

Net credit card fees decreased $336 thousand mainly due to higher rewards expense.

Net debit card fees decreased $107 thousand, while net merchant fees increased $89 thousand.

Compared to the third quarter of last year, deposit account fees increased $2.0 million, or 8.1%, mainly due to higher corporate cash management fees of $1.8 million.

Capital market fees decreased $857 thousand, or 14.3%, mainly due to lower underwriting and trading securities income, while consumer brokerage service fees increased $2.1 million, or 45.0%, mainly due to higher life insurance income and annuity fees.

Other non-interest income decreased $2.5 million, or 14.5%, mainly due to lower gains of $4.7 million on the sales of assets, partly offset by increases in cash sweep commissions, tax credit sales income and international fees of $677 thousand, $625 thousand and $408 thousand, respectively.

Non-interest income for the first nine months of 2025 was $486.1 million compared to $460.1 million in the first nine months of 2024, which was an increase of $26.0 million, or 5.6%.

The increase was mainly due to higher trust fees, deposit account fees and gains on the sales of assets.

Trust fees increased $12.5 million, or 7.9%, mainly due to higher private client and institutional trust fees.

Bank card transaction fees for the current year declined $4.5 million, or 3.1%, from the same period last year, mainly due to decreases of $3.5 million in net corporate card fees and $1.3 million in net credit card fees, partly offset by an increase in net merchant fees of $678 thousand.

Deposit account fees increased $5.4 million, or 7.3%, mainly due to higher corporate cash management fees.

Capital market fees increased $1.8 million, or 12.1%, mainly due to higher trading securities and underwriting income.

Consumer brokerage service fees increased $3.4 million, or 24.9%, mainly due to higher life insurance income, annuity fees and advisory fees.

Other non-interest income increased $7.1 million, or 15.1%, mainly due to increases of $3.3 million in gains on the sales of assets, $1.4 million in tax credit sales income and $1.2 million in cash sweep commissions.

In addition, an increase in fair value adjustments of $777 thousand was recorded on the Company's deferred compensation plan assets and liabilities.

Bank card transaction fees for the current quarter were flat compared to the same period last year.

Net credit card fees decreased $173 thousand mainly due to higher rewards expense and net merchant fees decreased $184 thousand.

Net corporate card fees were flat compared to the same period last year, while net debit card fees increased $301 thousand mainly due to higher interchange income.

Compared to the first quarter of last year, deposit account fees increased $2.0 million, or 7.3%, mainly due to higher corporate cash management fees of $1.5 million.

Capital market fees increased $226 thousand, or 4.4%, while consumer brokerage service fees increased $659 thousand, or 13.8%, mainly due to higher advisory fees.

Other non-interest income decreased $227 thousand, or 1.3%, mainly due to a decrease of $911 thousand in gains on the sales of assets and a decrease of $1.3 million in fair value adjustments recorded on the Company's deferred compensation plan assets and liabilities.

These decreases were partly offset by an increase of $1.2 million in cash sweep commissions.

Investment Securities Gains (Losses), Net

Three Months Ended September 30 Nine Months Ended September 30

Three Months Ended March 31

(In thousands) 2026 2025

4 unchanged sentences

Total investment securities gains (losses), net $ 11,647 $ (7,591)

Net gains and losses on investment securities, which were recognized in earnings during the three months ended September 30, 2025 and 2024, are shown in the table above.

Net securities gains of $7.9 million were reported in the third quarter of 2025, compared to net gains of $3.9 million in the same period last year.

The net gains in the third quarter of 2025 were mainly comprised of net gains in fair value of $8.0 million recorded on private equity investments.

These gains were partially offset by net losses of $111 thousand on equity investments.

The net gains on investment securities for the same quarter last year were primarily comprised of net gains in fair value of $7.4 million recorded on private equity investments and net gains of $2.0 million on sales of private equity investments.

These gains were largely offset by net losses of $5.4 million on the sale of available for sale securities as part of the planned portfolio repositioning.

Additional information about the sale of Visa Class C shares and the Company's available for sale debt portfolio repositioning transactions is discussed in Note 3, Investment Securities.

Net gains on investment securities of $731 thousand were recognized in earnings for the nine months ended September 30, 2025, compared to net gains of $6.8 million for the same period in 2024.

Net gains in the first nine months of 2025 were mainly comprised of net gains in fair value of $3.8 million recorded on private equity investments and net gains of $1.7 million on equity securities.

These gains were largely offset by net losses of $4.2 million on the sale of available for sale securities.

Net gains in the first nine months of 2024 were mainly comprised of net gains of $178.1 million on equity investments and net gains in fair value of $20.2 million recorded on private equity investments, largely offset by net losses of $192.9 million on sales of available for sale securities.

The portion of private equity activity attributable to minority interests is reported as non-controlling interest in the consolidated statements of income and resulted in expense of $656 thousand during the first nine months of 2025 and expense of $3.4 million during the first nine months of 2024.

Net gains and losses on investment securities, which were recognized in earnings during the three months ended March 31, 2026 and 2025, are shown in the table above.

Net securities gains of $11.6 million were reported in the first quarter of 2026, compared to net losses of $7.6 million in the same period last year.

The net gains in the first quarter of 2026 were mainly comprised of net gains in fair value of $10.9 million recorded on private equity investments and net gains of $597 thousand on sales of private equity investments.

The net losses on investment securities for the same quarter last year were primarily comprised of net losses in fair value of $8.5 million recorded on private equity investments, partly offset by net gains of $1.0 million on sales of private equity investments.

The portion of private equity activity attributable to minority interests is reported as non-controlling interest in the consolidated statements of income and resulted in expense of $2.3 million during the first three months of 2026 and income of $1.5 million during the first three months of 2025.

Non-Interest Expense

Three Months Ended September 30 Increase (Decrease) Nine Months Ended September 30 Increase (Decrease)

(Dollars in thousands) 2025 2024 Amount % change 2025 2024 Amount % change

Three Months Ended March 31 Increase (Decrease)

(Dollars in thousands) 2026 2025 Amount % change

Salaries and employee benefits $ 180,787 $ 153,078 $ 27,709 18.1 %

Data processing and software 38,328 32,238 6,090 18.9

Net occupancy 13,474 13,411 63 .5 41,148 39,529 1,619 4.1

Professional and other services 18,792 10,026 8,766 87.4

Net occupancy 15,308 14,020 1,288 9.2

Marketing 6,957 5,843 1,114 19.1

4 unchanged sentences

Total non-interest expense $ 291,126 $ 238,376 $ 52,750 22.1 %

Non-interest expense for the third quarter of 2025 amounted to $244.0 million, an increase of $6.4 million, or 2.7%, compared to expense of $237.6 million in the third quarter of last year.

The increase in expense over the same period last year was mainly due to higher salaries and employee benefits expense, professional and other services expense and data processing and software expense.

Salaries and employee benefits expense increased $4.3 million, or 2.8%, mainly due to higher full-time salaries expense of $3.0 million and higher incentive compensation expense of $1.4 million, partly offset by lower healthcare expense of $805 thousand.

Full-time equivalent employees totaled 4,666 at September 30, 2025, compared to 4,711 at September 30, 2024.

Non-interest expense for the first quarter of 2026 amounted to $291.1 million, an increase of $52.8 million, or 22.1%, compared to expense of $238.4 million in the first quarter of last year.

The current quarter included $14.0 million in acquisition-related expense, as well as acquisition-related intangible amortization expense of $5.4 million.

The increase in expense over the same period last year was mainly due to higher salaries and employee benefits expense, data processing and software expense, professional and other services expense and intangible amortization expense.

Salaries and employee benefits expense increased $27.7 million, or 18.1%, mainly due to an accrual for retention bonuses, acquisition-related compensation payments and the onboarding of FineMark's team members.

Salaries and benefits expense included acquisition-related costs of $6.6 million in the current quarter.

Full-time salaries, incentive compensation and healthcare expense increased $13.4 million, $7.7 million and $2.2 million, respectively, over the prior year.

Full-time equivalent employees totaled 4,960 at March 31, 2026, compared to 4,662 at March 31, 2025.

Data processing and software expense increased $6.1 million, or 18.9%, mainly due to higher costs for service providers and software.

Professional and other services expense, which increased $8.8 million, or 87.4%, included $4.7 million of acquisition-related legal and professional services expense.

Other non-interest expense decreased $1.3 million, or 14.0%, mainly due to a $1.5 million reimbursement during the third quarter of 2025 related to a litigation settlement.

Non-interest expense amounted to $726.8 million for the first nine months of 2025, an increase of $11.3 million, or 1.6%, over the first nine months of 2024.

Salaries and benefits expense increased $11.5 million, or 2.5%, mainly due to higher full-time salaries expense and incentive compensation expense.

Data processing and software expense increased $3.8 million, or 4.0%, due to increased costs for service providers and software expense.

Professional and other services expense increased $8.2 million, or 31.4%, and included $3.1 million in acquisition related legal and professional fees.

Occupancy expense increased $1.6 million, or 4.1%, mainly due to higher building depreciation expense and demolition costs.

Marketing expense increased $1.8 million, or 10.9%, and equipment expense increased $439 thousand, or 2.9%.

Supplies and communication expense increased $502 thousand, or 3.5%, mainly due to higher bank card reissuance costs.

Deposit insurance decreased $3.2 million, or 23.8%, mainly due to accrual adjustments in 2024 and 2025 to the special assessment by the FDIC.

Other non-interest expense decreased $13.4 million, or 32.5%, mainly due to litigation settlement expense of $10.0 million, net of insurance, and a $5.0 million donation to a related charitable foundation, both recorded in 2024.

In addition, a $1.5 million reimbursement was recorded in the third quarter of 2025 related to a litigation settlement.

These decreases were partly offset by higher travel and entertainment expense of $837 thousand and an increase in fair value adjustments of $777 thousand recorded on the Company's deferred compensation plan assets and liabilities.

Net occupancy expense increased $1.3 million, or 9.2%, mainly due to higher building depreciation expense.

Other non-interest expense increased $7.0 million, or 76.6%, mainly due to increases of $5.4 million in intangible amortization expense related to the FineMark acquisition and $2.0 million in other acquisition-related expense.

In addition, travel and entertainment expense increased $1.0 million, while a decrease in fair value adjustments of $1.3 million was recorded on the Company's deferred compensation plan assets and liabilities.

Provision and Allowance for Credit Losses on Loans and Liability for Unfunded Lending Commitments

Three Months Ended Nine Months Ended September 30

(In thousands) Sept.

30, 2025 June 30, 2025 Sept.

30, 2024 2025 2024

Three Months Ended

(In thousands) Mar.

31, 2026 Dec.

31, 2025 Mar.

ALLOWANCE FOR CREDIT LOSSES ON LOANS

Balance at beginning of period $ 165,260 $ 167,031 $ 158,557 $ 162,742 $ 162,395

Balance at end of prior period $ 179,468 $ 175,671 $ 162,742

Initial allowance for credit losses on purchased credit deteriorated loans at acquisition 2,957 — —

Initial allowance for credit losses on purchased seasoned loans at acquisition 19,871 — —

Provision for credit losses on loans 11,283 13,660 15,095

15 unchanged sentences

Balance at beginning of period $ 17,660 $ 15,327 $ 18,935

Initial allowance for credit loss at acquisition 362 — —

Provision for credit losses on unfunded lending commitments (323) 2,333 (608)

1 unchanged sentence

ALLOWANCE FOR CREDIT LOSSES ON LOANS AND LIABILITY FOR UNFUNDED LENDING COMMITMENTS $ 216,304 $ 197,128 $ 185,358

Three Months Ended Nine Months Ended September 30

30, 2025 June 30, 2025 Sept.

30, 2024 2025 2024

Three Months Ended

31, 2026 Dec.

31, 2025 Mar.

Annualized net loan charge-offs (recoveries)*:

13 unchanged sentences

The following schedule provides a breakdown of the allowance for credit losses on loans (ACL) by loan class and the percentage of the allowance for credit losses to the related loan class at period end.

30, 2025 June 30, 2025 Sept.

31, 2026 Dec.

31, 2025 Mar.

(Dollars in thousands)

12 unchanged sentences

The Company's policies and processes for determining the allowance for credit losses on loans and the liability for unfunded lending commitments are discussed in Note 1 to the consolidated financial statements and in the " Allowance for Credit Losses" discussion within Critical Accounting Estimates and Related Policies in Item 7 of the 2025 Annual Report on Form 10-K.

Net loan charge-offs in the third quarter of 2025 amounted to $10.3 million, compared to $9.7 million in the prior quarter and $9.6 million in the third quarter of last year.

Comp ared to the same period last year, net loan charge-offs in the third quarter of 2025 increased $749 thousand, and increased $638 thousand from the previous quarter.

The increase from the prior year was mainly driven by increases of $712 thousand and $242 thousand in business and consumer credit card loan net charge-offs, respectively, offset by a decrease of $449 thousand in consumer loan net charge-offs.

The increase in net loan charge-offs for the three months ended September 30, 2025 from the previous quarter was driven by increases of $402 thousand and $394 thousand in net charge-offs on business real estate and business loans, respectively, partially offset by a decrease of $570 thousand in net charge-offs on consumer credit card loans.

For the three months ended September 30, 2025, annualized net charge-offs on average consumer credit card loans were 4.59%, compared to 5.08% in the previous quarter and 4.46% in the same period last year.

Net loan charge-offs in the first quarter of 2026 amounted to $15.0 million, compared to $9.9 million in the prior quarter and $10.8 million in the first quarter of last year.

Comp ared to the same period last year, net loan charge-offs in the first quarter of 2026 increased $4.2 million, and increased $5.1 million from the previous quarter.

The increase from the prior year was mainly driven by an increase of $5.0 million in business real estate loan net charge-offs, offset by a decrease of $1.1 million in consumer loan net charge-offs.

The increase in net loan charge-offs for the three months ended March 31, 2026 from the previous quarter was driven by increases of $5.4 million and $651 thousand in net charge-offs on business real estate and consumer credit card loans, respectively, partially offset by a decrease of $730 thousand in net charge-offs on consumer loans.

For the three months ended March 31, 2026, annualized net charge-offs on average consumer credit card loans were 5.21%, compared to 4.55% in the previous quarter and 5.04% in the same period last year.

Consumer loan annualized net charge-offs in the current quarter amounted to .30%, compared to .45% in the prior quarter and .56% in the same period last year.

In the third quarter of 2025 , total annualized net loan charge-offs were .23%, compared to .22% in the previous quarter and .22% in the same period last year.

For the nine months ended September 30, 2025, total annualized net loan charge-offs were .24%, compared to .22% in the same period last year.

Net loan charge-offs were $30.8 million in the first nine months of 2025, an increase of $2.6 million over net loan charge-offs of $28.2 million in the first nine months of 2024.

The increase in net loan charge-offs during the first nine months of 2025 was mainly driven by higher net charge-offs on consumer credit card, consumer, and business loans.

For the three months ended September 30, 2025 , the provision for credit losses on loans was $20.7 million, which was an increase of $12.8 million from the provision recorded in the prior quarter.

The provision for the three months ended September 30, 2025 was the result of an increase in the allowance for credit losses on loans.

Compared to the same period in the prior year, the provision for credit losses on loans for the three months ended September 30, 2025 increased $8.9 million.

For the nine months ended September 30, 2025, the provision for credit losses on loans was $43.8 million, which was a $17.1 million increase over the $26.7 million provision recorded in the same period last year.

In the first quarter of 2026 , total annualized net loan charge-offs were .30%, compared to .22% in the previous quarter and .25% in the same period last year.

For the three months ended March 31, 2026 , the provision for credit losses on loans was $11.3 million, which was a decrease of $2.4 million from the provision recorded in the prior quarter.

Compared to the same period in the prior year, the provision for credit losses on loans for the three months ended March 31, 2026 decreased $3.8 million.

Changes in the provision are driven by changes in the estimate for the allowance for credit losses on loans.

At September 30, 2025, the allowance for credit losses increased $12.9 million compared to the allowance for credit losses on loans at December 31, 2024.

The allowance for credit losses on loans increased $6.2 million in the commercial portfolio primarily due to weakness in soft commodity prices impacting certain industries, partially offset by improvement in loss rate assumptions for the Company's construction loans.

The allowance for credit losses on the Company's personal banking

portfolio increased $6.8 million due to recent increases in charge-off trends impacting expected loss rate assumptions for the consumer credit card, automobile, and other non-real estate consumer portfolios.

The forecast utilized to estimate the allowance for credit losses at September 30, 2025 was more pessimistic than the forecast utilized at December 31, 2024 and reflected a slight decline in key macroeconomic variables.

The forecast did not assume a recession.

The allowance for credit losses on loans was $175.7 million at September 30, 2025 and was .99%, .95% and .94% of total loans at September 30, 2025, December 31, 2024 and September 30, 2024, respectively.

In the current quarter, the provision for credit losses on unfunded lending commitments was a benefit of $678 thousand, compared to a benefit of $2.7 million for the three months ended September 30, 2024.

At September 30, 2025, the liability for unfunded lending commitments was $15.3 million, compared to $18.9 million at December 31, 2024 and $18.0 million at September 30, 2024.

The liability decreased primarily due to decreases in unfunded lending commitment balances, coupled with improvement in loss rate assumptions for the Company's construction loans.

At March 31, 2026, the allowance for credit losses increased $19.1 million compared to the allowance for credit losses on loans at December 31, 2025.

The most significant driver of the increase in the allowance for credit losses is due to an increase in loan balances as a result of the acquisition of FineMark, as the initial allowance for FineMark loans acquired was $22.8 million.

The allowance for credit losses on loans increased $8.4 million in the commercial portfolio, and the allowance for credit losses on the Company's personal banking portfolio increased $10.8 million.

The allowance as a percentage of outstanding loans decreased compared to the prior quarter due to the change in mix of loans, as the acquired loan portfolio included more personal real estate loans which carry a lower allowance for credit losses than other classes.

The forecast utilized to estimate the allowance for credit losses on loans at March 31, 2026 assumes a slow but continued economic expansion, and changes in the forecast utilized to estimate the allowance at March 31, 2026 did not significantly change the allowance estimate during the quarter.

The allowance for credit losses on loans was $198.6 million at March 31, 2026 and was .97%, 1.01% and .96% of total loans at March 31, 2026, December 31, 2025 and March 31, 2025, respectively.

In the current quarter, the provision for credit losses on unfunded lending commitments was a benefit of $323 thousand, compared to a benefit of $608 thousand for the three months ended March 31, 2025.

At March 31, 2026, the liability for unfunded lending commitments was $17.7 million, compared to $17.7 million at December 31, 2025 and $18.3 million at March 31, 2025.

At March 31, 2026, the liability for unfunded lending commitments remained largely unchanged from December 31, 2025, because the initial liability recorded related to the FineMark acquisition of $362 thousand was largely offset by a decrease in the provision for the liability for unfunded lending commitments.

The Company's unfunded lending commitments primarily relate to construction loans, and the Company's estimate for credit losses in its unfunded lending commitments utilizes the same model and forecast as its estimate for credit losses on loans.

See Note 3 for further discussion of the model inputs utilized in the Company's estimate of credit losses.

The Company considers the allowance for credit losses on loans and the liability for unfunded commitments adequate to cover losses expected in the loan portfolio, including unfunded commitments, at September 30, 2025.

The allowance for credit losses on loans and the liability for unfunded lending commitments are estimates that require significant judgment including projections of the macro-economic environment.

3 unchanged sentences

These estimates are subject to periodic refinement based on changes in the underlying external and internal data.

Risk Elements of Loan Portfolio

Risk Elements of the Loan Portfolio

The following table presents non-performing assets and loans which are past due 90 days and still accruing interest.

3 unchanged sentences

(Dollars in thousands)

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Non-accrual loans $ 10,920 $ 15,750

4 unchanged sentences

Total loans past due 90 days and still accruing interest $ 22,824 $ 24,659

Non-accrual loans totaled $16.3 million at September 30, 2025, a decrease of $2.0 million from the balance at December 31, 2024.

The decrease occurred mainly in revolving home equity non-accrual loans, which decreased $2.0 million.

At September 30, 2025, non-accrual loans were comprised of business real estate (91.9%), personal real estate (5.3%) business (1.6%), and construction and land (1.2%) loans.

Foreclosed real estate totaled $790 thousand at September 30, 2025, an increase of $447 thousand compared to December 31, 2024.

Total loans past due 90 days or more and still accruing interest totaled $21.5 million as of September 30, 2025, a decrease of $3.0 million from December 31, 2024.

Non-accrual loans totaled $10.9 million at March 31, 2026, a decrease of $4.8 million from the balance at December 31, 2025.

The decrease occurred mainly in business real estate non-accrual loans, which decreased $5.4 million.

At March 31, 2026, non-accrual loans were comprised of business real estate (85.8%), personal real estate (12.1%), business (1.8%), and revolving home equity (0.3%) loans.

Foreclosed real estate totaled $678 thousand at March 31, 2026, a decrease of $540 thousand compared to December 31, 2025.

Total loans past due 90 days or more and still accruing interest totaled $22.8 million as of March 31, 2026, a decrease of $1.8 million from December 31, 2025.

Balances by class for non-accrual loans and loans past due 90 days and still accruing interest are shown in the "Delinquent and non-accrual loans" section in Note 3 to the consolidated financial statements.

3 unchanged sentences

Although these loans are generally identified as potential problem loans, they may never become non-performing.

Such loans totaled $274.6 million at September 30, 2025 compared to $330.3 million at December 31, 2024, resulting in a decrease of $55.7 million, or 16.9%.

Such loans totaled $296.2 million at March 31, 2026 compared to $264.9 million at December 31, 2025, resulting in an increase of $31.3 million, or 11.8%.

(In thousands)

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Potential problem loans:

3 unchanged sentences

Real estate – personal 1,593 91

Consumer 14 —

Total potential problem loans $ 296,192 $ 264,894

When borrowers are experiencing financial difficulty, the Company may agree to modify the contractual terms of a loan to a borrower in order to assist the borrower in repaying principal and interest owed to the Company.

At September 30, 2025, the Company held $168.3 million of loans that had been modified during the nine months ended September 30, 2025.

At March 31, 2026, the Company held $66.9 million of loans that had been modified during the three months ended March 31, 2026.

These loans are further discussed in the "Modifications for borrowers experiencing financial difficulty" section in Note 3 to the consolidated financial statements.

6 unchanged sentences

Real Estate – Construction and Land Loans

The Company's portfolio of construction and land loans, as shown in the table below, amounted to 8.1% of total loans outstanding at September 30, 2025.

The largest component of construction and land loans was commercial construction, which increased $24.9 million during the nine months ended September 30, 2025.

At September 30, 2025, multi-family residential construction loans totaled approximately $556.3 million, or 45.5%, of the commercial construction loan portfolio, compared to $526.6 million, or 44.0%, at December 31, 2024.

(Dollars in thousands) September 30,

The Company's portfolio of construction and land loans, as shown in the table below, amounted to 7.7% of total loans outstanding at March 31, 2026.

The largest component of construction and land loans was commercial construction, which decreased $26.6 million during the three months ended March 31, 2026.

At March 31, 2026, multi-family residential construction loans totaled approximately $529.5 million, or 44.1%, of the commercial construction loan portfolio, compared to $553.1 million, or 45.1%, at December 31, 2025.

(Dollars in thousands) March 31,

December 31, 2025

5 unchanged sentences

Real Estate – Business Loans

Total business real estate loans were $3.7 billion at September 30, 2025 and comprised 21.1% of the Company's total loan portfolio.

Total business real estate loans were $4.1 billion at March 31, 2026 and comprised 19.8% of the Company's total loan portfolio.

These loans include properties such as manufacturing and warehouse buildings, small office and medical buildings, churches, hotels and motels, shopping centers, and other commercial properties.

At September 30, 2025, 32.5% of business real estate loans were for owner-occupied real estate properties, which have historically resulted in lower net charge-off rates than non-owner-occupied commercial real estate loans.

(Dollars in thousands) September 30,

At March 31, 2026, 37.1% of business real estate loans were for owner-occupied real estate properties, which have historically resulted in lower net charge-off rates than non-owner-occupied commercial real estate loans.

(Dollars in thousands) March 31,

December 31, 2025

Owner-occupied $ 1,504,132 37.1 % 7.4 % $ 1,248,172 34.0 % 7.0 %

Office 543,599 14.5 3.1 520,715 14.2 3.0

Industrial 648,223 16.0 3.2 628,223 17.1 3.5

Office 611,456 15.1 3.0 528,421 14.4 3.0

Hotels 355,576 8.8 1.7 326,147 8.9 1.8

5 unchanged sentences

Total real estate - business loans $ 4,059,539 100.0 % 19.8 % $ 3,674,567 100.0 % 20.7 %

Information about the credit quality of the Company's business real estate loan portfolio as of September 30, 2025 and December 31, 2024 is provided in the table below.

Information about the credit quality of the Company's business real estate loan portfolio as of March 31, 2026 and December 31, 2025 is provided in the table below.

(Dollars in thousands) Pass Special Mention Substandard Non-Accrual Total

September 30, 2025

March 31, 2026

Owner-occupied $ 1,432,564 $ 10,851 $ 60,593 $ 124 $ 1,504,132

Office 458,285 27,631 57,683 — 543,599

Industrial 648,223 — — — 648,223

Office 559,736 — 51,720 — 611,456

Hotels 353,300 2,276 — — 355,576

7 unchanged sentences

Owner-occupied $ 1,198,970 $ 18,011 $ 31,067 $ 124 $ 1,248,172

Office 451,189 11,980 57,546 — 520,715

Industrial 628,223 — — — 628,223

Office 443,737 27,175 57,509 — 528,421

Hotels 326,147 — — — 326,147

6 unchanged sentences

Revolving Home Equity Loans

The Company had $364.2 million in revolving home equity loans at September 30, 2025 that were collateralized by residential real estate.

The Company had $619.2 million in revolving home equity loans at March 31, 2026 that were collateralized by residential real estate.

Most of these loans (94.9%) are written with terms requiring interest-only monthly payments.

1 unchanged sentence

LTV up to 80%, 80% to 90%, and 90% to 100%.

As of September 30, 2025, the

outstanding principal of loans with an original LTV higher than 80% was $28.6 million, or 8.0% of the portfolio, compared to $31.9 million as of December 31, 2024.

Total revolving home equity loan balances over 30 days past due were $1.4 million at September 30, 2025 and $5.6 million at December 31, 2024, and there was no outstanding balance for revolving home equity loans on non-accrual status at September 30, 2025 compared to $2.0 million at December 31, 2024.

The weighted average FICO score for the total portfolio balance at September 30, 2025 is 777.

As of March 31, 2026, the outstanding principal of loans with an original LTV higher than 80% was $78.6 million, or 12.6% of the portfolio, compared to $27.7 million as of December 31, 2025.

Total revolving home equity loan balances over 30 days past due were $4.8 million at March 31, 2026 and $1.9 million at December 31, 2025, and the outstanding balance for revolving home equity loans on non-accrual status was $34 thousand at March 31, 2026 compared to no balance at December 31, 2025.

The weighted average FICO score for the total portfolio balance at March 31, 2026 is 776.

At maturity, the accounts are re-underwritten, and if they qualify under the Company's credit, collateral and capacity policies, the borrower is given the option to renew the line of credit or convert the outstanding balance to an amortizing loan.

5 unchanged sentences

The consumer loans category is mostly comprised of private banking loans and automobile loans.

Private banking loans comprised of 39.2% of the consumer loan portfolio at September 30, 2025.

Private banking loans comprised of 48.2% of the consumer loan portfolio at March 31, 2026.

The Company's private banking loans are mostly executive lines of credit, which are secured primarily by assets held by the Company's trust department, and insurance premium finance loans, which are primarily secured by life insurance policies.

Automobile loans, which include direct and indirect product lines, comprised 35.8% of the consumer loan portfolio at September 30, 2025, and outstanding balances for auto loans were $778.2 million and $776.7 million at September 30, 2025 and December 31, 2024, respectively.

The balances over 30 days past due amounted to $9.3 million at September 30, 2025 and $14.4 million at December 31, 2024, respectively, and comprised 1.2% of the outstanding balances of these loans at September 30, 2025 and 1.9% at December 31, 2024.

For the nine months ended September 30, 2025, $282.9 million of new auto loans were originated, compared to $260.6 million during the first nine months of 2024.

At September 30, 2025, the automobile loan portfolio had a weighted average FICO score of 756, and net charge-offs on auto loans were .9% of average auto loans.

The Company's consumer loan portfolio also includes fixed rate home equity loans, typically for home repair or remodeling, and these loans comprised 9.7% of the consumer loan portfolio at September 30, 2025.

Losses on these loans have historically been low, and the Company saw net recoveries of $135 thousand for the first nine months of 2025.

Automobile loans, which include direct and indirect product lines, comprised 30.5% of the consumer loan portfolio at March 31, 2026, and outstanding balances for auto loans were $754.3 million and $773.6 million at March 31, 2026 and December 31, 2025, respectively.

The balances over 30 days past due amounted to $8.4 million at March 31, 2026 and $11.0 million at December 31, 2025, respectively, and comprised 1.1% of the outstanding balances of these loans at March 31, 2026 and 1.4% at December 31, 2025.

For the three months ended March 31, 2026, $88.2 million of new auto loans were originated, compared to $98.0 million during the first three months of 2025.

March 31, 2026, the automobile loan portfolio had a weighted average FICO score of 759, and net charge-offs on auto loans were .5% of average auto loans.

The Company's consumer loan portfolio also includes fixed rate home equity loans, typically for home repair or remodeling, and these loans comprised 8.5% of the consumer loan portfolio at March 31, 2026.

Losses on these loans have historically been low, and the Company saw net recoveries of $591 thousand for the first three months of 2026.

The remaining portion of the Company's consumer loan portfolio is comprised of healthcare financing, boat, RV, motorcycle, other equipment, and unsecured consumer loans.

Net charge-offs on consumer loans, other than automobile loans, totaled $2.3 million in the first nine months of 2025 and were .3% of the average balances of these loans at September 30, 2025.

Net charge-offs on consumer loans, other than automobile and fixed rate home equity loans, totaled $755 thousand in the first three months of 2026 and were .2% of the average balances of these loans at March 31, 2026.

Consumer Credit Card Loans

The Company offers low promotional rates on selected consumer credit card products.

Out of a portfolio at September 30, 2025 of $575.3 million in consumer credit card loans outstanding, approximately $125.2 million, or 21.8%, carried a low promotional rate.

Out of a portfolio at March 31, 2026 of $557.7 million in consumer credit card loans outstanding, approximately $120.5 million, or 21.6%, carried a low promotional rate.

Within the next six months, $54.5 million of these loans are scheduled to convert to the ongoing higher contractual rate.

1 unchanged sentence

Management believes that the risks in the consumer loan portfolio are reasonable and the anticipated loss ratios are within acceptable parameters.

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

100.0 % 100.0 %

Oil and Gas Energy Lending

The Company's energy lending portfolio is comprised of lending to the petroleum and natural gas sectors and totaled $302.0 million, or 1.7% of total loans at September 30, 2025, a decrease of $36.0 million from December 31, 2024, as shown in the table below.

The Company's energy lending portfolio is comprised of lending to the petroleum and natural gas sectors and totaled $369.6 million, or 1.8% of total loans at March 31, 2026, an increase of $66.5 million from December 31, 2025, as shown in the table below.

(In thousands)

September 30, 2025 December 31, 2024 Unfunded commitments at September 30, 2025

March 31, 2026 December 31, 2025 Unfunded commitments at March 31, 2026

Upstream activities $ 232,000 $ 228,660 $ 146,090

7 unchanged sentences

The Company typically participates in these loans when business operations are maintained in the local communities or regional markets and opportunities to provide other banking services are present.

The balance of SNC loans totaled $1.6 billion at both September 30, 2025 and December 31, 2024.

Additional unfunded commitments at September 30, 2025 totaled $2.4 billion.

Income tax expense was $41.2 million in the third quarter of 2025, compared to $42.4 million in the second quarter of 2025 and $38.2 million in the third quarter of 2024.

The Company's effective tax rate, including the effect of non-controlling interest, was 22.5% in the third quarter of 2025, 21.8% in the second quarter of 2025, and 21.7% in the third quarter of 2024.

The increase in the effective tax rate compared to the prior quarter was mostly due to state tax law changes enacted in the prior quarter that decreased the effective tax rate.

The increase in the effective tax rate compared to the third quarter of 2024 was mostly due to higher state and local income taxes.

On July 4, 2025, the One Big Beautiful Act ("OBBBA") was enacted in the United States.

The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cut and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions.

The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027.

We do not expect these items to have a significant impact on our financial statements, though we expect that some minor operational changes may be necessary to support new information reporting requirements.

The balance of SNC loans totaled $1.7 billion at March 31, 2026 and $1.5 billion December 31, 2025.

Additional unfunded commitments at March 31, 2026 totaled $2.4 billion.

Income tax expense was $40.9 million in the first quarter of 2026, compared to $40.6 million in the fourth quarter of 2025 and $37.0 million in the first quarter of 2025.

The Company's effective tax rate, including the effect of non-controlling interest, was 22.4% in the first quarter of 2026, 22.4% in the fourth quarter of 2025, and 21.9% in the first quarter of 2025.

Financial Condition

Balance Sheet

Total assets of the Company were $32.3 billion at September 30, 2025 and $32.0 billion at December 31, 2024.

Earning assets (excluding the allowance for credit losses on loans and fair value adjustments on available for sale debt securities) amounted to $31.1 billion at September 30, 2025 and $30.9 billion at December 31, 2024, and consisted of 57% in loans and 32% in investment securities at September 30, 2025.

At September 30, 2025, total loans increased $566.7 million or 3.3%, compared to balances at December 31, 2024.

The increase was mainly due to growth in business, business real estate, and construction loans of $361.0 million, $83.8 million, and $23.8 million, respectively.

The increase in business loans was mainly due to growth in commercial and industrial, commercial credit card and tax-free lending.

In addition, consumer loans increased $98.5 million, mainly due to growth in private banking loans.

These increases were partially offset by a decrease in consumer credit card loans of $20.6 million.

Total available for sale debt securities, excluding fair value adjustments, decreased $440.3 million a t September 30, 2025 compared to December 31, 2024.

Available for sale debt security sales, maturities and pay downs during this period totaled $1.5 billion , partly offset by pu rchases of available for sale debt securities during this period of $991.7 million.

The decline in available for sale debt securities was mainly the result of lower balances of mortgage-backed securities, asset-backed securities and state and municipal obligations, which decreased $450.6 million, $186.1 million and $74.2 million, respectively, at

September 30, 2025 compared to December 31, 2024.

These decreases were partly offset by growth of $309.0 million in U.S.

government and federal agency obligations.

At September 3 0, 2025, the duration of the available for sale investment portfolio was 4.4 years, and maturities and pay downs of approximately $1.3 billion are expected to occur during the next 12 months.

Total deposits at September 30, 2025 amounted to $25.5 billion, an increase of $164.4 million compared to December 31, 2024.

The increase in deposits largely resulted from an increase in interest checking and money market deposit balances of $807.9 million.

This increase was partly offset by a decrease in demand deposits of $661.0 million, mainly in business demand deposits (decrease of $688.3 million).

The Company’s borrowings totaled $2.5 billion at September 30, 2025, a decrease of $444.5 million from balances at December 31, 2 024, mainly due to a decline in customer repurchase agreement balances.

Total assets of the Company were $35.7 billion at March 31, 2026 and $32.9 billion at December 31, 2025.

Earning assets (excluding the allowance for credit losses on loans and fair value adjustments on available for sale debt securities) amounted to $34.3 billion at March 31, 2026 and $31.4 billion at December 31, 2025, and consisted of 60% in loans and 28% in investment securities at March 31, 2026.

During the first quarter of 2026, average loans totaled $20.3 billion, an increase of $2.7 billion over the prior quarter, and an increase of $3.1 billion over the same quarter last year.

The increase in average balances over both periods was primarily due to the acquisition of FineMark, which added $2.7 billion in loan balances.

Compared to the previous quarter, average balances of personal real estate, business, business real estate, revolving home equity and consumer loans grew $1.4 billion, $369.3 million, $315.0 million, $238.9 million and $221.0 million, respectively.

During the current quarter, the Company sold certain fixed rate personal real estate loans totaling $26.2 million, compared to $27.0 million in the prior quarter.

Total average available for sale debt securities decreased $269.0 million from the previous quarter to $8.9 billion, at fair value.

The decrease in available for sale debt securities was mainly the result of lower average balances of mortgage-backed and asset-backed securities.

During the first quarter of 2026, the unrealized loss on available for sale debt securities increased $40.7 million to $687.5 million, at period end.

Also, during the first quarter of 2026, maturities and pay downs of available for sale debt securities were $410.7 million.

At March 31, 2026, the duration of the available for sale investment portfolio was 4.2 years, and maturities and pay downs of approximately $1.2 billion are expected to occur during the next 12 months.

Average interest earning deposits with banks increased $210.4 million over average balances in the previous quarter, and the average balance within other assets increased $374.4 million mainly due to increases in goodwill, intangible assets, and premises and equipment related to the Company’s acquisition of FineMark.

Total average deposits increased $2.1 billion over the previous quarter.

The increase in average balances was primarily due to the FineMark acquisition, which added $2.7 billion in interest bearing and $425 million in non-interest bearing deposit balances.

Shortly after the acquisition, the Company moved $1.0 billion of FineMark’s high-cost, money market deposit balances off-balance sheet.

Compared to the prior quarter, average interest checking and money market deposits and demand deposits increased $1.7 billion and $282.1 million, respectively.

Additionally, average balances of certificates of deposit of $100,000 and over increased $76.0 million compared to the prior quarter, mainly due to deposit balances acquired from FineMark.

Compared to the previous quarter, total average wealth and retail banking deposits grew $2.3 billion and $251.0 million, respectively, while commercial deposits declined $408.3 million.

The average loans to deposits ratio was 73.4% in the current quarter and 69.0% in the prior quarter.

The Company’s average borrowings, which included average customer repurchase agreements of $2.7 billion, increased $345.7 million to $2.9 billion in the first quarter of 2026.

Federal Home Loan Bank advances of $350.0 million, which the Company acquired from the FineMark acquisition, were paid off in January 2026.

Liquidity and Capital Resources

Liquidity Management

The Company’s most liquid assets include balances at the Federal Reserve Bank, federal funds sold, and available for sale debt securities, as follows:

The Company’s most liquid assets include balances at the Federal Reserve Bank, federal funds sold, available for sale debt securities, and securities purchased under agreements to resell, as follows:

(In thousands)

September 30, 2025 September 30, 2024 December 31, 2024

March 31, 2026 March 31, 2025 December 31, 2025

Liquid assets:

2 unchanged sentences

Available for sale debt securities 8,646,127 9,264,947 9,095,513

Securities purchased under agreements to resell 850,000 — 850,000

Total $ 12,766,803 $ 12,021,468 $ 12,689,906

Interest earning balances at the Federal Reserve Bank, which have overnight maturities and are used for general liquidity purposes, totaled $2.5 billion at September 30, 2025 and decreased $147 thousand from December 31, 2024.

At September 30, 2025, the Company did not have a balance of federal funds sold, which are funds lent to the Company's correspondent bank customers with overnight maturities.

The fair value of the available for sale debt portfolio was $9.0 billion at September 30, 2025 and included an unrealized net loss of $688.5 million.

Interest earning balances at the Federal Reserve Bank, which have overnight maturities and are used for general liquidity purposes, totaled $3.3 billion at March 31, 2026 and increased $526 million from December 31, 2025.

At March 31, 2026, the Company's balance of federal funds sold totaled $630 thousand, which are funds lent to the Company's correspondent bank customers with overnight maturities.

The fair value of the available for sale debt portfolio was $8.6 billion at March 31, 2026 and included an unrealized net loss of $687.5 million.

The total net unrealized loss included net losses of $620.0 million on mortgage-backed and asset-backed securities and $51.0 million on state and municipal obligations.

The Company's available for sale debt securities portfolio has a diverse mix of high quality and liquid investment securities with a duration of 4.4 years at September 30, 2025.

The Company holds securities purchased under agreements to resell (“resale agreements”) which totaled $850.0 million at March 31, 2026, with maturities in 2028 through 2030.

Under these agreements, the Company lends funds to upstream financial institutions and holds marketable securities, safe-kept by a third-party custodian, as collateral.

This collateral totaled $871.1 million in fair value at March 31, 2026.

The Company's available for sale debt securities portfolio has a diverse mix of high quality and liquid investment securities with a duration of 4.2 years at March 31, 2026.

Approximately $1.2 billion of the Company's available for sale debt portfolio is expected to mature or pay down during the next 12 months, and these funds offer substantial resources to meet either new loan demand or offset potential reductions in the Company's deposit funding base.

2 unchanged sentences

(In thousands)

September 30, 2025 September 30, 2024 December 31, 2024

March 31, 2026 March 31, 2025 December 31, 2025

Investment securities pledged for the purpose of securing:

8 unchanged sentences

* Includes securities pledged for collateral swaps outstanding at each period end shown in the table.

The average loans to deposits ratio is a measure of a bank's liquidity, and the Company’s average loans to deposits ratio was 70.1% for the nine months ended September 30, 2025.

Core customer deposits, defined as non-interest bearing, interest checking, savings, and money market deposit accounts totaled $23.0 billion and represented 90.5% of the Company's total deposits at September 30, 2025.

The average loans to deposits ratio is a measure of a bank's liquidity, and the Company’s average loans to deposits ratio was 73.4% for the three months ended March 31, 2026.

Core customer deposits, defined as non-interest bearing, interest checking, savings, and money market deposit accounts totaled $25.9 billion and represented 91.4% of the Company's total deposits at March 31, 2026.

These core deposits are normally less volatile, as they are often with customer relationships tied to other products offered by the Company, promoting long lasting relationships and stable funding sources.

Core deposits increased $136.2 million at September 30, 2025 compared to December 31, 2024, primarily due to an increase in commercial

deposits of $451.4 million, partly offset by a decrease in consumer deposits of $265.9 million.

While the Company considers core consumer and wealth management deposits less volatile, corporate deposits could decline if interest rates increase significantly, encouraging corporate customers to increase investing activities, or if the economy deteriorates and companies experience lower cash inflows, reducing deposit balances.

Core deposits increased $2.7 billion at March 31, 2026 compared to December 31, 2025, primarily due to an increase in wealth deposits from the acquisition of FineMark Holdings, Inc.

While the Company considers core retail banking and wealth deposits less volatile, corporate deposits could decline if interest rates increase significantly, encouraging corporate customers to increase investing activities, or if the economy deteriorates and companies experience lower cash inflows, reducing deposit balances.

If these corporate deposits decline, the Company's funding needs may be met by liquidity supplied by investment security maturities and pay downs expected to total $1.2 billion over the next year, as noted above.

In addition, as shown in the table of collateral available for future advances below, the Company has borrowing capacity of $6.9 billion through advances from the FHLB and the Federal Reserve.

The Company also holds securities sold under agreements to repurchase ("resale agreements") which are an additional source of liquidity.

At September 30, 2025, the Company's resale agreements totaled $850.0 million and mature from 2028 through 2030.

Under these agreements, the Company lends funds to upstream financial institutions and holds marketable securities, safe-kept by a third-party custodian, as collateral.

This collateral totaled $875.1 million in fair value at September 30, 2025.

Certificates of deposit of $100,000 or greater totaled $1.4 billion at September 30, 2025.

These deposits are normally considered more volatile and higher costing, and comprised 5.6% of total deposits at September 30, 2025.

(In thousands)

September 30, 2025 September 30, 2024 December 31, 2024

March 31, 2026 March 31, 2025 December 31, 2025

Core deposit base:

3 unchanged sentences

Total $ 25,935,860 $ 23,493,526 $ 23,253,117

During the third quarter of 2024, the Company issued $100.0 million of short-term brokered certificates of deposit, which all matured by December 31, 2024.

The Company may occasionally issue brokered certificates of deposit to test the reliability of this potential funding source.

Certificates of deposit of $100,000 or greater totaled $1.4 billion at March 31, 2026.

These deposits are normally considered more volatile and higher costing, and comprised 5.0% of total deposits at March 31, 2026.

The Company may occasionally issue short-term brokered certificates of deposit to test the reliability of this potential funding source.

While it is not clear how many brokered certificates of deposit the market would allow the Company to issue, the Company believes brokered certificates of deposits may be an additional, reliable source of liquidity during periods of stress in the banking industry.

2 unchanged sentences

(In thousands)

September 30, 2025 September 30, 2024 December 31, 2024

March 31, 2026 March 31, 2025 December 31, 2025

Federal funds purchased $ 129,730 $ 132,370 $ 128,625

2 unchanged sentences

Total $ 2,584,768 $ 2,417,779 $ 3,002,439

Federal funds purchased, which totaled $137.7 million at September 30, 2025, are unsecured overnight borrowings obtained mainly from upstream correspondent banks with which the Company maintains approved lines of credit.

At September 30, 2025, the Company had approved lines of credit totaling $4.6 billion.

Federal funds purchased, which totaled $129.7 million at March 31, 2026, are unsecured overnight borrowings obtained mainly from upstream correspondent banks with which the Company maintains approved lines of credit.

At March 31, 2026, the Company had approved lines of credit totaling $4.4 billion.

Since these borrowings are unsecured and limited by market trading activity, their availability may be less certain than collateralized sources of borrowings.

1 unchanged sentence

Repurchase agreements are collateralized by securities in the Company's investment portfolio.

Total repurchase agreements at September 30, 2025 were comprised of non-insured customer funds totaling $2.3 billion, and securities pledged as collateral for these retail agreements totaled $2.4 billion at September 30, 2025.

Total repurchase agreements at March 31, 2026 were comprised of non-insured customer funds totaling $2.4 billion, and securities pledged as collateral for these retail agreements totaled $2.5 billion at March 31, 2026.

The Company also borrows on a secured basis through advances from the FHLB.

The advances are generally short-term, fixed interest rate borrowings.

There were no advances outstanding from the FHLB at September 30, 2025.

There were no advances outstanding from the FHLB at March 31, 2026.

The Company pledges certain assets, including loans and investment securities, to both the FRB and the FHLB as security to establish lines of credit and borrow from these entities.

2 unchanged sentences

The FRB also establishes a collateral value of assets pledged and permits borrowings from the discount window.

The following table reflects the collateral

value of assets pledged, borrowings, and letters of credit outstanding, in addition to the estimated future funding capacity available to the Company at September 30, 2025.

September 30, 2025

The following table reflects the collateral value of assets pledged, borrowings, and letters of credit outstanding, in addition to the estimated future funding capacity available to the Company at March 31, 2026.

March 31, 2026

(In thousands)

17 unchanged sentences

The Company has no subordinated or hybrid debt instruments which would affect future borrowing capacity.

Because of its lack of significant long-term debt, the Company believes that through its Commercial Tradable Products division or in other public debt markets, it could generate additional liquidity from sources such as jumbo certificates of deposit, privately placed corporate notes or other forms of debt.

The cash flows from the operating, investing and financing activities of the Company resulted in a net decrease in cash, cash equivalents and restricted cash of $421.8 million during the first nine months of 2025, as reported in the consolidated statements of cash flows in this report.

Because of its lack of significant long-term debt, the Company believes that through its Commercial

Tradable Products division or in other public debt markets, it could generate additional liquidity from sources such as jumbo certificates of deposit, privately placed corporate notes or other forms of debt.

The cash flows from the operating, investing and financing activities of the Company resulted in a net increase in cash, cash equivalents and restricted cash of $295.6 million during the first three months of 2026, as reported in the consolidated statements of cash flows in this report.

Operating activities, consisting mainly of net income adjusted for certain non-cash items, provided cash flow of $684.8 million and have historically been a stable source of funds.

Investing activities, which occur mainly in the loan and investment securities portfolios, used cash of $400.3 million.

Growth in the loan portfolio used cash of $598.9 million and purchases of securities under agreements to resell (net of repayments) used cash of $225.0 million.

These uses of cash were partly balanced by sales, maturities, and pay downs (net of purchases) of investment securities, which provided cash of $462.5 million.

Investing activities, which occur mainly in the loan and investment securities portfolios, provided cash of $859.2 million.

This growth is primarily due to the cash assumed in the acquisition of FineMark Holdings, Inc., and sales, maturities, and pay downs (net of purchases) of investment securities, which provided cash of $428.9 million.

Investing activities are somewhat unique to financial institutions in that, while large sums of cash flow are normally used to fund growth in investment securities, loans, or other bank assets, they are normally dependent on the financing activities described below.

Financing activities used cash of $400.3 million, largely resulting from federal funds purchased and securities sold under agreements to repurchases, which used cash of $453.7 million during the first nine months of 2025, partly offset by a net increase of $250.4 million in deposits.

Financing activities used cash of $1.2 billion, largely resulting from repayments of FHLB borrowings (assumed in the FineMark acquisition), which used cash of $600.0 million, federal funds purchased and securities sold under agreements to repurchase, which used cash of $475.9 million, and a decrease of $287.7 million in deposits during the first three months of 2026.

Cash dividend payments (including distributions to non-controlling interest) and purchases of treasury stock used cash of $41.9 million and $84.3 million, respectively.

Capital Management

The Company met all capital adequacy requirements and had regulatory capital ratios in excess of the levels established for well-capitalized institutions at September 30, 2025 and December 31, 2024, as shown in the following table.

(Dollars in thousands) September 30, 2025 December 31, 2024 Minimum Capital Requirement Capital Conservation Buffer Minimum Ratios Requirement including Capital Conservation Buffer

The Company met all capital adequacy requirements and had regulatory capital ratios in excess of the levels established for well-capitalized institutions at March 31, 2026 and December 31, 2025, as shown in the following table.

(Dollars in thousands) March 31, 2026 December 31, 2025 Minimum Capital Requirement Capital Conservation Buffer Minimum Ratios Requirement including Capital Conservation Buffer

Minimum Ratios

11 unchanged sentences

Failure to maintain the buffer will result in constraints on dividends, share repurchases, and executive compensation.

In the first quarter of 2020, the interim final rule of the Federal Reserve Bank and other U.S.

banking agencies became effective, providing banks that adopted CECL (ASU 2016-13) during the 2020 calendar year the option to delay recognizing the estimated impact on regulatory capital until after a two year deferral period, followed by a three year transition period.

In connection with the adoption of CECL on January 1, 2020, the Company elected to utilize this option.

As a result, the two year deferral period for the Company extended through December 31, 2021.

Beginning on January 1, 2022, the Company was required to phase in 25% of the previously deferred estimated capital impact of CECL, with an additional 25% to be phased in at the beginning of each subsequent year until fully phased in, which was during the first quarter of 2025.

The Company maintains a treasury stock buyback program under authorizations by its Board of Directors (the Board) and periodically purchases stock in the open market.

During the nine months ended September 30, 2025, the Company purchased 1,862,967 shares at an average price of $62.85 in open market purchases and through stock-based compensation transactions.

At September 30, 2025, 1,486,812 shares remained available for purchase under the Board authorization in place at that date.

On October 31, 2025, the share repurchase authorization was increased to 5,000,000 shares.

During the three months ended March 31, 2026, the Company purchased 1,624,840 shares at an average price of $51.56 in open market purchases and stock-based compensation transactions.

At March 31, 2026, 1,634,000 shares remained available for purchase under the Board authorization in place at that date.

On April 24, 2026, the share repurchase authorization was increased to 7,500,000 shares.

The Company's common stock dividend policy reflects its earnings outlook, desired payout ratios, the need to maintain adequate capital levels and alternative investment options.

The Company paid a $.275 per share cash dividend on its common stock in the third quarter of 2025, which was a 7.0% increase compared to its 2024 quarterly dividend.

The Company paid a $.275 per share cash dividend on its common stock in the first quarter of 2026, which was a 5.0% increase compared to its 2025 quarterly dividend.

Material Cash Requirements, Commitments, Off-Balance Sheet Arrangements and Contingencies

2 unchanged sentences

Additionally, the Company will utilize cash to fund deposit maturities and withdrawals that may occur in the next 12 months.

Other contractual obligations, purchase commitments, lease obligations, and unfunded commitments may require cash payments by the Company within the next 12 months, and these are further discussed in the Company's 2024 Annual Report on Form 10-K.

Other contractual obligations, purchase commitments, lease obligations, and unfunded commitments may require cash payments by the Company within the next 12 months, and these are further discussed

in the Company's 2025 Annual Report on Form 10-K.

Further discussion of the Company's longer-term material cash obligations and sources for fulfilling those obligations is below.

In the normal course of business, various commitments and contingent liabilities arise that are not required to be recorded on the balance sheet.

The most significant of these are loan commitments, which at September 30, 2025 totaled $16.2 billion (including $6.0 billion in unused, approved credit card lines).

The most significant of these are loan commitments, which at March 31, 2026 totaled $16.9 billion (including $6.2 billion in unused, approved credit card lines).

In addition, the Company enters into standby and commercial letters of credit.

The contractual amount of standby and commercial letters of credit totaled $631.8 million and $1.8 million, respectively, at September 30, 2025.

The contractual amount of standby and commercial letters of credit totaled $668.8 million and $1.8 million, respectively, at March 31, 2026.

As many commitments expire unused or only partially used, these totals do not necessarily reflect future cash requirements.

The allowance for these commitments is recorded in the Company’s liability for unfunded lending commitments within other liabilities on its consolidated balance sheets.

At September 30, 2025, the liability

for unfunded lending commitments totaled $15.3 million.

At March 31, 2026, the liability for unfunded lending commitments totaled $17.7 million.

See further discussion of the liability for unfunded lending commitments in Note 3 to the consolidated financial statements.

1 unchanged sentence

These credits are either resold to third parties at a profit or retained for use by the Company.

During the first nine months of 2025, purchases and sales of tax credits amounted to $160.2 million and $125.4 million, respectively.

Fees from sales of tax credits were $4.9 million for the nine months ended September 30, 2025, compared to $3.5 million in the same period last year.

At September 30, 2025, the Company expected to fund outstanding purchase commitments of $16.7 million during the remainder of 2025 and had purchase commitments of $545.8 million that it expects to fund from 2026 through 2029.

The Company continued to maintain a strong liquidity position throughout the first nine months of 2025.

During the first three months of 2026, purchases and sales of tax credits amounted to $14.0 million and $45.2 million, respectively.

Fees from sales of tax credits were $1.5 million for the three months ended March 31, 2026, compared to $1.9 million in the same period last year.

At March 31, 2026, the Company expected to fund outstanding purchase commitments of $142.9 million during the remainder of 2026 and had purchase commitments of $471.6 million that it expects to fund from 2027 through 2030.

The Company continued to maintain a strong liquidity position throughout the first three months of 2026.

Through the various sources of liquidity described above, the Company maintains a liquidity position that it believes will adequately satisfy its financial obligations.

Segment Results

The table below is a summary of segment pre-tax income results for the first nine months of 2025 and 2024.

The table below is a summary of segment pre-tax income results for the first three months of 2026 and 2025.

(Dollars in thousands)

Retail Banking Commercial

Other/ Elimination

Consolidated Totals

Nine Months Ended September 30, 2025

Three Months Ended March 31, 2026

Net interest income $ 122,572 $ 133,601 $ 46,123 $ 302,296 $ (2,456) $ 299,840

4 unchanged sentences

Income before income taxes $ 49,521 $ 84,014 $ 63,228 $ 196,763 $ (11,511) $ 185,252

Nine Months Ended September 30, 2024

Three Months Ended March 31, 2025

Net interest income $ 125,234 $ 133,266 $ 22,159 $ 280,659 $ (11,557) $ 269,102

7 unchanged sentences

Percent (10.4) % (15.2) % 40.5 % (1.3) % (63.7) % 10.5 %

For the nine months ended September 30, 2025, income before income taxes for the Consumer segment decreased $13.6 million, or 7.3%, compared to the first nine months of 2024.

The decrease in income before income taxes was due to declines in net interest income of $5.3 million, or 1.4%, and non-interest income of $1.4 million, or 1.8%, and increases in non-interest expense of $5.1 million, or 2.1%, and the provision for credit losses of $1.8 million.

Net interest income declined due to lower net allocated funding credits assigned to the Consumer segment's loan and deposit portfolios of $11.7 million and loan interest income of $1.1 million.

These decreases were partly offset by lower deposit interest expense of $7.5 million.

Non-interest income decreased mainly due to lower net bank card fees (mainly credit and debit card fees).

Non-interest expense increased over the same period in the previous year mainly due to higher marketing, miscellaneous losses, data processing and software, and supplies expense.

In addition, allocated support costs increased due to higher allocated costs for retail administration and operations.

The increase in the provision for credit losses over the first nine months of 2024 was mainly due to higher auto and consumer credit card loan net charge-offs, partly offset by lower other vehicle and equipment loan net charge-offs.

For the nine months ended September 30, 2025, income before income taxes for the Commercial segment increased $12.8 million, or 4.7%, compared to the same period in the previous year.

This increase was mainly due to higher net interest income and non-interest income, partly offset by higher non-interest expense.

Net interest income increased $13.0 million, or 3.4%, mainly due to lower interest expense on deposits and customer repurchase agreements of $20.1 million and $6.9 million,

respectively, coupled with higher net allocated funding credits of $12.9 million.

These increases to income were partly offset by lower loan interest income of $27.5 million.

Non-interest income increased $15.7 million, or 8.0%, over the previous year mainly due to higher gains on asset sales and growth in deposit account fees (mainly corporate cash management fees) and capital market fees (mainly underwriting and trading securities).

These increases were partly offset by a decrease in net bank card fees (mainly corporate card fees).

Non-interest expense increased $15.3 million, or 5.0%, mainly due to higher legal fees, salaries and benefits expense and allocated service and support costs for commercial payments and product support, commercial loan servicing and branch employee expense.

The provision for credit losses increased $596 thousand over the same period last year, mainly due to higher commercial and industrial loan net charge-offs.

Wealth segment pre-tax profitability for the nine months ended September 30, 2025 increased $11.5 million, or 9.0%, over the same period in the previous year.

Net interest income increased $1.3 million, or 2.0%, mainly due to $5.9 million increase in loan interest income and a $2.9 million decrease deposit interest expense.

These increases were partly offset by a $7.4 million decrease in net allocated funding credits.

Non-interest income increased $16.1 million, or 9.0%, over the prior year largely due to higher private client and institutional trust fees and brokerage fees (mainly life insurance, annuity and advisory fees).

Non-interest expense increased $5.8 million, or 4.9%, mainly due to higher salaries and benefits, data processing and software, and allocated support costs for information technology.

The provision for credit losses increased $167 thousand over the same period last year.

Retail Banking

For the three months ended March 31, 2026, income before income taxes for the Retail Banking segment decreased $5.7 million, or 10.4%, compared to the first three months of 2025.

The decrease in income before income taxes was due to an increase in non-interest expense of $4.9 million, or 5.9%, and a decline in net interest income of $2.7 million, or 2.1%.

These decreases to income were partly offset by a decline in the provision for credit losses of $979 thousand, or 9.6%, and an increase in non-interest income of $833 thousand, or 3.6%.

Non-interest expense increased over the same period in the previous year mainly due to higher data processing and software costs and allocated support costs (mainly online banking, ATM and other non-branch support costs).

Net interest income declined due to lower loan interest income of $2.0 million and lower net

allocated funding credits assigned to the Retail Banking segment's loan and deposit portfolios of $1.0 million.

The increase in non-interest income was mainly due to growth in deposit account fees (mainly overdraft and return items fees) and mortgage banking revenue.

The decrease in the provision for credit losses from the first three months of 2025 was mainly due to lower auto loan net charge-offs.

For the three months ended March 31, 2026, income before income taxes for the Commercial segment decreased $15.1 million, or 15.2%, compared to the same period in the previous year.

This decrease was mainly due to higher non-interest expense, an increase in the provision for credit losses, and lower non-interest income, slightly offset by higher net interest income.

Non-interest expense increased $8.9 million, or 8.5%, mainly due to higher legal fees, salaries and benefits expense and allocated service and support costs for commercial sales, credit administration and bank operations.

The provision for credit losses increased $5.2 million, mainly due to a business real estate loan charge-off on a single senior living loan in the current year.

Non-interest income decreased $1.4 million, or 2.0%, mainly due to a decrease in gains on the sales of assets, partly offset by higher deposit account fees (mainly corporate cash management fees).

Net interest income increased $335 thousand, or .3%, mainly due to lower interest expense on deposits and customer repurchase agreements of $4.5 million and $3.9 million, respectively.

These increases to income were largely offset by lower loan interest income of $6.7 million and lower allocated funding credits of $1.3 million.

Wealth segment pre-tax profitability for the three months ended March 31, 2026 increased $18.2 million, or 40.5%, over the same period in the previous year.

The increase was mainly due to the FineMark acquisition.

Net interest income increased $24.0 million, or 108.1%, mainly due to a $38.3 million increase in loan interest income.

This increase was partly offset by a $9.3 million increase in deposit interest expense and a $4.5 million decrease in net allocated funding credits.

Non-interest income increased $16.2 million, or 25.3%, over the prior year largely due to higher private client and institutional trust fees.

Non-interest expense increased $21.9 million, or 53.2%, mainly due to higher salaries and benefits, data processing and software, and occupancy expense.

The provision for credit losses decreased $2 thousand from the same period last year.

The Other/Elimination category in the preceding table includes the activity of various support and overhead operating units of the Company, in addition to the investment securities portfolio and other items not allocated to the segments.

1 unchanged sentence

The pre-tax profitability in this category was $20.2 million higher than in the same period last year.

Unallocated securities gains were $731 thousand in the first nine months of 2025 compared to gains of $6.8 million in 2024.

Also, the unallocated provision for credit losses decreased $18.2 million, primarily driven by an increase in the provision for credit losses on loans, partly offset by a decrease in the liability for unfunded lending commitments, which are both not allocated to the segments for management reporting purposes.

Unallocated securities gains were $11.6 million in the first three months of 2026 compared to losses of $7.6 million in 2025.

Also, the unallocated provision for credit losses decreased $7.7 million, primarily driven by a decrease in the provision for credit losses on loans, partly offset by an increase in the liability for unfunded lending commitments, which are both not allocated to the segments for management reporting purposes.

Net charge-offs are allocated to the segments when incurred for management reporting purposes.

The provision for credit losses on loans in the first nine months of 2025 was $43.8 million, or $12.9 million higher than net charge-offs, due to an increase in the allowance for credit losses on loans.

In the comparable period last year, the provision for credit losses on loans was $26.7 million, or $1.6 million lower than net charge-offs, due to a decrease in the allowance for credit losses on loans.

For the nine months ended September 30, 2025, the Company's provision on unfunded lending commitments was a benefit of $3.6 million.

Additionally, net interest income increased $46.1 million, while non-interest expense decreased $15.0 million.

These increases to pre-tax profitability were partly offset by a decrease in non-interest income $4.5 million.

The provision for credit losses on loans in the first three months of 2026 was $11.3 million, or $3.7 million lower than net charge-offs.

In the comparable period last year, the provision for credit losses on loans was $15.1 million, or $4.3 million higher than net charge-offs, due to an increase in the allowance for credit losses on loans.

The allowance for credit losses on loans increased in the current year as a result of the FineMark initial allowance at acquisition of $22.8 million.

For the three months ended March 31, 2026, the Company's provision on unfunded lending commitments was a benefit of $323 thousand.

Additionally, net interest income and non-interest income increased $9.1 million and $1.3 million, respectively, but were offset by an increase in non-interest expense of $17.1 million.

Impact of Recently Issued Accounting Standards

2 unchanged sentences

This Update also removed certain existing disclosure requirements.

This Update is effective for annual periods beginning January 1, 2025.

Early adoption is permitted.

The amendments in this Update should be applied on a prospective basis, though retrospective application is permitted.

Other than the inclusion of additional disclosures, the adoption is not expected to have a significant effect on the Company's consolidated financial statements.

The Company adopted this Update for the year ended December 31, 2025, and applied the new disclosures on a retrospective basis.

Purchased Loans The FASB issued ASU 2025-08 "Financial Instruments - Credit Losses (Topic 326):

Purchased Loans" in November 2025.

This new guidance makes significant changes to the accounting for certain acquired seasoned loans subject to the current expected credit loss model (CECL).

Under the ASU, the initial allowance for credit losses recorded upon the acquisition of loans in scope is recognized as an adjustment to the amortized cost basis of the loan - similar to the model for purchased credit deteriorated assets.

For these loans, the "day-one" credit loss estimate does not impact earnings immediately but is instead amortized over time as an adjustment to interest income.

Subsequent changes in the allowance for credit losses are reported in earnings within credit loss expense.

The ASU is effective for fiscal periods beginning after December 15, 2026 and interim periods within.

Early adoption is permitted and amendments are to be applied prospectively.

The Company adopted this Update on January 1, 2026.

Income Statement Reporting The FASB issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

12 unchanged sentences

The adoption is not expected to have a significant effect on the Company's consolidated financial statements.

AVERAGE BALANCE SHEETS — AVERAGE RATES AND YIELDS

Three Months Ended September 30, 2025 and 2024

Third Quarter 2025

Third Quarter 2024

(Dollars in thousands)

Average Balance

Interest Income/Expense

Rates Earned/Paid

Average Balance Interest Income/Expense Avg.

Rates Earned/Paid

$ 6,230,019 $ 89,818 5.72 % $ 5,966,797 $ 92,471 6.17 %

Real estate — construction and land 1,396,977 25,934 7.37 1,400,563 29,704 8.44

Real estate — business 3,715,597 55,433 5.92 3,580,772 56,528 6.28

Real estate — personal 3,059,913 33,509 4.34 3,047,563 31,402 4.10

Consumer 2,160,637 34,962 6.42 2,129,483 35,519 6.64

Revolving home equity 360,820 7,220 7.94 335,817 6,490 7.69

Consumer credit card 563,351 18,759 13.21 559,410 19,697 14.01

Overdrafts 7,037 — — 5,460 — —

Total loans 17,494,351 265,635 6.02 17,025,865 271,811 6.35

Loans held for sale 2,369 36 6.03 2,448 39 6.34

Investment securities:

government and federal agency obligations 2,693,327 27,547 4.06 1,888,985 17,478 3.68

Government-sponsored enterprise obligations 55,014 326 2.35 55,583 331 2.37

State and municipal obligations (A)

756,137 3,901 2.05 856,620 4,317 2.00

Mortgage-backed securities 4,461,056 22,573 2.01 5,082,091 24,956 1.95

Asset-backed securities 1,466,770 13,644 3.69 1,525,593 10,188 2.66

Other debt securities 204,281 1,528 2.97 224,528 1,166 2.07

Trading debt securities (A)

56,032 659 4.67 47,440 539 4.52

Equity securities (A)

50,823 780 6.09 85,118 951 4.44

Other securities (A)

220,041 4,044 7.29 217,377 3,330 6.09

Total investment securities 9,963,481 75,002 2.99 9,983,335 63,256 2.52

Federal funds sold 23 — — 12 — —

Securities purchased under agreements to resell 850,000 8,578 4.00 474,997 4,215 3.53

Interest earning deposits with banks 2,422,441 27,167 4.45 2,565,188 35,034 5.43

Total interest earning assets 30,732,665 376,418 4.86 30,051,845 374,355 4.96

Allowance for credit losses on loans (164,623) (158,003)

Unrealized gain (loss) on debt securities (766,025) (961,695)

Cash and due from banks 374,673 361,854

Premises and equipment, net 502,525 481,301

Other assets 832,049 805,166

Total assets $ 31,511,264 $ 30,580,468

LIABILITIES AND EQUITY:

Interest bearing deposits:

Savings $ 1,283,671 156 .05 $ 1,303,675 214 .07

Interest checking and money market 13,740,770 53,201 1.54 13,242,398 57,963 1.74

Certificates of deposit of less than $100,000 991,877 8,337 3.33 1,055,683 11,073 4.17

Certificates of deposit of $100,000 and over 1,416,572 13,258 3.71 1,464,143 16,603 4.51

Total interest bearing deposits 17,432,890 74,952 1.71 17,065,899 85,853 2.00

Federal funds purchased $ 130,622 $ 1,428 4.34 206,644 $ 2,792 5.38

Securities sold under agreements to repurchase 2,519,660 18,260 2.88 2,351,870 21,066 3.56

Other borrowings (B)

1,860 8 1.71 496 6 4.81

Total borrowings 2,652,142 19,696 2.95 2,559,010 23,864 3.71

Total interest bearing liabilities 20,085,032 94,648 1.87 % 19,624,909 109,717 2.22 %

Non-interest bearing deposits 7,345,156 7,284,834

Other liabilities 402,265 405,490

Equity 3,678,811 3,265,235

Total liabilities and equity $ 31,511,264 $ 30,580,468

Net interest margin (FTE) $ 281,770 $ 264,638

Net yield on interest earning assets 3.64 % 3.50 %

(A) Stated on a fully taxable-equivalent basis using a federal income tax rate of 21%.

(B) Interest expense capitalized on construction projects in 2024 is not deducted from the interest expense shown above.

There was no interest expense capitalized in 2025.

Derivatives and Hedging The FASB issued ASU 2025-09 "Derivatives and Hedging (Topic 815):

Hedge Accounting Improvements" in December 2025.

The amendments in this Update make targeted improvements to hedge account intended to better align financial reporting with an entity's risk-management activities.

At a high level, the Update provides for a broader application of grouping forecasted transactions in cash flow hedges by replacing 'same risk exposure' requirements with a more flexible 'similar risk exposure' standard, which may apply to the Company's current cash flow hedges.

This Update is effective for annual and interim periods beginning after December 15, 2026.

Early adoption is permitted in an interim or annual reporting period.

The amendments should be applied on a prospective basis for all hedging relationships, and the Company may elect to adopt the amendments for existing hedging relationships as of the adoption, without dedesignating the hedges.

The Company is currently evaluating the provisions of this Update.

Interim Reporting The FASB issued ASU 2025-11 "Interim Reporting (Topic 270):

Narrow-Scope Improvements" in December 2025.

The amendments in this Update are intended to clarify interim disclosure requirements and the applicability of Topic 270.

The ASU is effective for interim periods within annual periods beginning after December 15, 2027.

Early adoption is permitted and amendments may be applied prospectively or retrospectively to prior periods presented.

The Company does not anticipate a significant impact on the Company's consolidated financial statements.

AVERAGE BALANCE SHEETS — AVERAGE RATES AND YIELDS

Nine Months Ended September 30, 2025 and 2024

Nine Months 2025

Nine Months 2024

Three Months Ended March 31, 2026 and 2025

First Quarter 2026

First Quarter 2025

(Dollars in thousands)

48 unchanged sentences

Securities sold under agreements to repurchase 2,674,484 15,780 2.39 2,723,227 19,224 2.86

Other borrowings (B)

1,746 35 2.68 470 14 3.98

Other borrowings 90,796 869 3.88 616 1 .66

Total borrowings 2,907,168 17,929 2.50 2,852,183 20,609 2.93

7 unchanged sentences

(A) Stated on a fully taxable-equivalent basis using a federal income tax rate of 21%.

(B) Interest expense capitalized on construction projects in 2024 is not deducted from the interest expense shown above.

There was no interest expense capitalized in 2025.

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-Q

Item 2. Management’s Discussion and Analysis