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Item 7. Management’s Discussion and Analysis

2026-03-06 compared with 2025-03-07 · 148 added, 151 removed, 663 unchanged (31% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF FIRSTSUN

In this section, unless the context suggests otherwise, references to “we,” “us,” and “our” mean the combined business of FirstSun and its wholly-owned subsidiaries, Sunflower Bank, Logia Portfolio Management, LLC, and FEIF Capital Partners, LLC.

In this section, unless the context suggests otherwise, references to “we,” “us,” and “our” mean the combined business of FirstSun and its wholly-owned subsidiaries, Sunflower Bank, Sunflower Wealth Advisors, LLC, and FEIF Capital Partners, LLC.

The following discussion is an analysis of our consolidated results of operations for the years ended December 31, 2025, 2024 and 2023, and financial condition for the years ended December 31, 2025 and 2024.

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General Overview

FirstSun Capital Bancorp, headquartered in Denver, Colorado, is the financial holding company for Sunflower Bank, National Association, which is headquartered in Dallas, Texas and operates as Sunflower Bank, First National 1870 and Guardian Mortgage, which we are in the process of rebranding as Sunflower Bank Mortgage Lending.

We conduct a full-service community banking and trust business through our wholly-owned subsidiaries—Sunflower Bank, Logia Portfolio Management, LLC, and FEIF Capital Partners, LLC.

We conduct a full-service community banking and trust business through our wholly-owned subsidiaries—Sunflower Bank, Sunflower Wealth Advisors, LLC and FEIF Capital Partners, LLC.

We offer a full range of relationship-focused services to meet our clients’ personal, business and wealth management financial objectives throughout Texas, Kansas, Colorado, New Mexico, Arizona, California and Washington and a mortgage lending platform with capabilities in 44 states.

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For additional information on our segments, see Note 21 - Segment Information included in our consolidated financial statements included elsewhere in this report.

Pending merger with First Foundation Inc.

On October 27, 2025, we entered into a merger agreement with First Foundation, the holding company of First Foundation Bank, headquartered in Irvine, California, as amended by amendment no.

1 to the merger agreement dated February 6, 2026.

Under the merger agreement, First Foundation will merge with and into FirstSun, with FirstSun continuing as the surviving entity.

Immediately following the merger, First Foundation Bank will merge with and into Sunflower Bank, with Sunflower Bank continuing as the surviving bank.

The consummation of the proposed merger will expand our markets in California and Texas, as well as add new markets in Florida, Nevada and Hawaii.

The merger agreement, as amended, was unanimously approved by the boards of directors of FirstSun and First Foundation, and is subject to customary closing conditions, including receipt of remaining required regulatory approvals.

The stockholders of FirstSun and First Foundation approved the merger agreement and transactions contemplated thereby at special stockholders’ meetings held on February 27, 2026.

The merger is expected to close early in the second quarter of 2026.

Financial Highlights For 2025

We delivered strong financial results in 2024, which included:

• Net income of $75.6 million, $2.69 per diluted share (adjusted, $87.7 million, $3.13 per diluted share, see the “Non-GAAP Financial Measures and Reconciliations” below)

We delivered strong financial results in 2025, compared to 2024, which included:

• Net income of $97.9 million, $3.47 per diluted share (adjusted net income of $100.5 million 1 , $3.56 adjusted per diluted share 1 )

• Net interest margin of 4.10%

• Return on average total assets of 0.96% (adjusted, 1.12%, see the “Non-GAAP Financial Measures and Reconciliations” below)

• Return on average stockholders’ equity of 7.56% (adjusted, 8.77%, see the “Non-GAAP Financial Measures and Reconciliations” below)

• Average deposit growth of 5.8%

• Return on average total assets of 1.18% (adjusted return on average total assets of 1.21% 1 )

• Return on average stockholders’ equity of 8.88% (adjusted return on average stockholders’ equity of 9.11% 1 )

• Loan growth of 4.7%

• 23.2% fee revenue to total revenue 1

• Average deposit growth of 6.6%

• 24.3% noninterest income to total revenue (defined as net interest income plus noninterest income)

Net income totaled $97.9 million, or $3.47 per diluted share, in 2025, compared to $75.6 million, or $2.69 per diluted share, in 2024.

Adjusted net income, a non-GAAP financial measure, was $87.7 million, or $3.13 per diluted share, in 2024.

Adjusted net income, a non-GAAP financial measure, was $100.5 million, or $3.56 per diluted share, in 2025 compared to $87.7 million, or $3.13 per adjusted diluted share, in 2024.

The return on average total assets was 1.18% in 2025, compared to 0.96% in 2024, and the return on average stockholders’ equity was 8.88% in 2025, compared to 7.56% in 2024.

Adjusted return on average total assets and adjusted return on average stockholders’ equity, each a non-GAAP financial measure, were 1.12% and 8.77% respectively in 2024.

The following table sets forth certain financial highlights of FirstSun as of and for the years ended December 31,:

Adjusted return on average total assets and adjusted return on average stockholders’ equity, each a non-GAAP financial measure, were 1.21% and 9.11% respectively in 2025 compared to 1.12% and 8.77% respectively in 2024.

The following tables set forth certain financial highlights of FirstSun as of and for the years ended December 31,:

($ in thousands, except per share amounts) 2025 2024 2023

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Total assets $ 8,485,162 $ 8,097,387 $ 7,879,724

Total loans held-for-sale 61,825 54,212 57,323

Total loans held-for-investment 6,376,357 6,267,096 5,911,832

Loans held-for-sale 100,539 61,825 54,212

Loans held-for-investment 6,673,180 6,376,357 6,267,096

Total deposits 7,107,356 6,672,260 6,374,103

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Total stockholders' equity 1,153,356 1,041,366 877,197

1 See section entitled “ Non-GAAP Financial Measures and Reconciliations ” for information regarding these non-GAAP financial measures and a reconciliation to the most comparable GAAP equivalent.

($ in thousands, except per share amounts) 2025 2024 2023

Per Common Share Data:

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37.83 33.94 30.96

1 Total revenue is net interest income plus noninterest income.

2 See section entitled “ Non-GAAP Financial Measures and Reconciliations ” for information regarding these non-GAAP financial measures and a reconciliation to the most comparable GAAP equivalent.

($ in thousands, except per share amounts) 2024 2023 2022

Performance Ratios:

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Nonperforming loans to total loans 0.91 % 1.08 % 1.01 %

1.08 % 1.01 % 0.49 %

Capital Ratios:

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Banking branches 71 69 69

1 Total revenue is net interest income plus noninterest income.

1 See section entitled “ Non-GAAP Financial Measures and Reconciliations ” for information regarding these non-GAAP financial measures and a reconciliation to the most comparable GAAP equivalent.

3 Nonperforming loans include nonaccrual loans and accrual loans greater than 90 days past due.

On January 1, 2023, we adopted ASU 2022-02, whereby we no longer recognize or account for TDRs.

The loans previously classified as accrual TDRs are no longer considered nonperforming.

We have adjusted December 31, 2022 to reflect this change in accounting.

2 Total revenue is net interest income plus noninterest income.

Non-GAAP Financial Measures and Reconciliations

The non-GAAP financial measures presented below are used by our management and our board of directors on a regular basis in addition to our GAAP results to facilitate the assessment of our financial performance.

Management believes these non-GAAP financial measures enhance an investor’s understanding of our financial results by providing a meaningful basis for period-to-period comparisons, assisting in operating results analysis, and predicting future performance.

Management believes these non-GAAP financial measures provide a greater understanding of our ongoing operations, enhance an investor’s understanding of our financial results by providing a meaningful basis for period-to-period comparisons, assisting in operating results analysis, and predicting future performance.

This information supplements our GAAP reported results, and should not be viewed in isolation from, or as a substitute for, our GAAP results.

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Net income (GAAP) $ 97,936 $ 75,628 $ 103,533

Non-recurring adjustments

Terminated merger / Merger related expenses, net of tax 9,949 — 14,668

Provision for loan loss on acquired loans marked at a premium, net of tax — — 2,363

Write-off of Guardian Mortgage trade name, net of tax 625 — —

Merger related expenses, net of tax 2,569 9,949 —

Write-off of Guardian Mortgage tradename, net of tax — 625 —

Disposal of ATMs, net of tax — 1,542 —

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Diluted earnings per share (GAAP) $ 3.47 $ 2.69 $ 4.08

Impact of non-recurring adjustments

Terminated merger / Merger related expenses, net of tax 0.36 — 0.62

Provision for loan loss on acquired loans marked at a premium, net of tax — — 0.10

Write-off of Guardian Mortgage trade name, net of tax 0.02 — —

Impact of adjustments

Merger related expenses, net of tax 0.09 0.36 —

Write-off of Guardian Mortgage tradename, net of tax — 0.02 —

Disposal of ATMs, net of tax — 0.06 —

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Return on average total assets (ROAA) (GAAP) 1.18 % 0.96 % 1.38 %

Impact of non-recurring adjustments

Terminated merger / Merger related expenses, net of tax 0.13 % — % 0.21 %

Provision for loan loss on acquired loans marked at a premium, net of tax — % — % 0.04 %

Write-off of Guardian Mortgage trade name 0.01 % — % — %

Disposal of ATMs 0.02 % — % — %

Impact of adjustments

Merger related expenses, net of tax 0.03 % 0.13 % — %

Write-off of Guardian Mortgage tradename, net of tax — % 0.01 % — %

Disposal of ATMs, net of tax — % 0.02 % — %

Adjusted ROAA (non-GAAP) 1.21 % 1.12 % 1.38 %

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Return on average stockholders' equity (ROACE) (GAAP) 8.88 % 7.56 % 12.50 %

Impact of non-recurring adjustments

Terminated merger / Merger related expenses, net of tax 1.00 % — % 2.12 %

Provision for loan loss on acquired loans marked at a premium, net of tax — % — % 0.34 %

Write-off of Guardian Mortgage trade name 0.06 % — % — %

Disposal of ATMs 0.15 % — % — %

Impact of adjustments

Merger related expenses, net of tax 0.23 % 1.00 % — %

Write-off of Guardian Mortgage tradename, net of tax — % 0.06 % — %

Disposal of ATMs, net of tax — % 0.15 % — %

Adjusted ROACE (non-GAAP) 9.11 % 8.77 % 12.50 %

Return on average tangible stockholders’ equity

Return on average stockholders’ equity (ROACE) 7.56 % 12.50 % 8.55 %

Return on average stockholders’ equity (ROACE) (GAAP) 8.88 % 7.56 % 12.50 %

Impact from goodwill and other intangible assets

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Other intangible assets 0.19 % 0.31 % 0.53 %

Return on average tangible stockholders’ equity (ROATCE) 8.74 % 14.88 % 10.45 %

Return on average tangible stockholders’ equity (ROATCE) (non-GAAP) 9.95 % 8.74 % 14.88 %

Adjusted return on average tangible stockholders’ equity:

Return on average tangible stockholders' equity (ROATCE) 8.74 % 14.88 % 10.45 %

Impact of non-recurring adjustments

Terminated merger / Merger related expenses, net of tax 1.11 % — % 2.45 %

Provision for loan loss on acquired loans marked at a premium, net of tax — % — % 0.40 %

Write-off of Guardian Mortgage trade name 0.07 % — % — %

Disposal of ATMs 0.17 % — % — %

Return on average tangible stockholders' equity (ROATCE) (non-GAAP) 9.95 % 8.74 % 14.88 %

Impact of adjustments

Merger related expenses, net of tax 0.26 % 1.11 % — %

Write-off of Guardian Mortgage tradename, net of tax — % 0.07 % — %

Disposal of ATMs, net of tax — % 0.17 % — %

Adjusted ROATCE (non-GAAP) 10.21 % 10.09 % 14.88 %

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Total noninterest expense (GAAP) $ 271,774 $ 264,040 $ 222,793

Non-recurring adjustments

Terminated merger / Merger related expenses (13,178) — (18,751)

Merger related expenses (2,743) (13,178) —

Write-off of Guardian Mortgage trade name — (828) —

Disposal of ATMs — (2,042) —

Total adjustments, net of tax (16,048) — (18,751)

Total adjustments (2,743) (16,048) —

Adjusted total noninterest expense (non-GAAP) $ 269,031 $ 247,992 $ 222,793

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Efficiency ratio (GAAP) 64.82 % 68.28 % 59.81 %

Impact of non-recurring adjustments

Terminated merger related expenses / Merger related expenses (3.41) % — % (5.66) %

Write-off of Guardian Mortgage trade name (0.21) % — % — %

Impact of adjustments

Merger related expenses (0.65) % (3.41) % — %

Write-off of Guardian Mortgage tradename — % (0.21) % — %

Disposal of ATMs — % (0.53) % — %

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Comparison of fiscal years 2025 and 2024

Income before income taxes decreased $48.9 million to $98.3 million in 2024, from $147.2 million in 2023.

The period over period decrease was primarily driven by a decrease in net interest income, increase in noninterest expenses, and increase in provision for credit losses, partially offset by an increase in noninterest income.

Net interest income decreased $9.3 million to $283.2 million in 2024 compared to $292.6 million in 2023.

The decrease in net interest income was a result of higher interest expense primarily due to continued intense competition for deposits amidst the elevated interest rate environment and an increase in certificates of deposit balances.

Income before income taxes increased $18.3 million to $116.6 million in 2025, from $98.3 million in 2024.

The period over period increase was primarily driven by an increase in net interest income, an increase in noninterest income, and a decrease in provision for credit losses, partially offset by an increase in noninterest expense.

Net interest income increased $13.8 million to $297.0 million in 2025 compared to $283.2 million in 2024.

The increase in net interest income was a result of lower interest expense primarily due to a decrease in balances and rates for certificates of deposit amidst the declining interest rate environment, partially offset by an increase in promotional rate money market deposit balances.

Noninterest income increased $3.9 million to $52.3 million in 2025 compared to $48.4 million in 2024 primarily due to an increase in treasury management service fees and loan syndication and swap fees.

Provision for credit losses decreased $1.7 million to $26.7 million in 2025 compared to $28.4 million in 2024.

Noninterest expense increased $1.1 million to $206.0 million in 2025, compared to $204.9 million in 2024.

The increase in noninterest expense was primarily the result of an increase in salary and employee benefits of $15.5 million and an increase of $8.6 million in terminated merger related expenses in 2024.

Provision for credit losses increased $12.6 million to $28.4 million in 2024 compared to $15.8 million in 2023.

The increase in the provision for credit losses was primarily due to a $13.6 million provision for credit loss on a specific customer in our commercial and industrial (C&I) loan portfolio in 2024.

Identifiable assets for our Banking segment decreased by $0.1 billion to $6.8 billion at December 31, 2024 from $6.9 billion at December 31, 2023.

The increase in noninterest expense was primarily the result of an increase in salary and employee benefits of $10.1 million primarily due to an increase in headcount of C&I bankers and support personnel, higher levels of variable compensation, and an increase in medical insurance costs.

Merger related expenses decreased $8.1 million to $0.5 million in 2025 compared to $8.6 million in 2024.

Identifiable assets for our Banking segment increased by $0.4 billion to $7.2 billion at December 31, 2025 from $6.8 billion at December 31, 2024.

Mortgage Operations

Income before income taxes increased to $9.7 million in 2024, compared to a loss of $6.5 million in 2023, primarily due to a $12.7 million increase in net interest income and a $8.4 million increase in mortgage banking services revenue, net, partially offset by a $6.3 million increase in salary and employee benefits.

Net interest income increased primarily due to a higher average balance and higher average yield on residential real estate loans and the impact of internal funds transfer pricing.

Mortgage banking services revenue, net increased primarily due to higher net sale gains and fees from mortgage loan originations and to a lesser extent, an increase in mortgage servicing income, and MSR capitalization and changes in fair value, net of derivative activity.

Income before income taxes increased $8.0 million to $17.6 million in 2025, from $9.7 million in 2024.

The period over period increase was primarily driven by an increase in net interest income, an increase in mortgage banking service revenues, and a decrease in provision for (benefit from) credit losses, partially offset by an increase in noninterest expense.

Net interest income increased $6.3 million to $24.9 million in 2025 compared to $18.6 million in 2024.

The increase in net interest income was a result of a higher average balance and higher average yield on residential real estate loans and the impact of internal funds transfer pricing.

Mortgage banking service revenues increased $8.2 million to $49.6 million in 2025 compared to $41.4 million in 2024, primarily due to an increase in gain on sales driven by higher origination volume and an increase in mortgage servicing revenue driven by higher servicing portfolio balances.

Total mortgage loan originations for sale were $1.4 billion in 2025, an increase of $0.3 billion from $1.1 billion in 2024.

The unpaid principal balance of mortgage loans serviced for others were $6.3 billion in 2025, an increase of $0.5 billion from $5.8 billion in 2024.

Salary and employee benefits increased due to higher levels of variable compensation associated with an increase in mortgage loan originations.

Provision for (benefit from) credit losses decreased $1.3 million to $(2.1) million in 2025 compared to $(0.9) million in 2024.

The increase in noninterest expense was primarily the result of an increase in salary and employee benefits of $6.2

million to $37.8 million in 2025, from $31.6 million in 2024 primarily due to higher levels of variable compensation associated with an increase in mortgage loan originations.

Identifiable assets for our Mortgage Operations segment increased by $0.1 billion to $1.2 billion at December 31, 2025 from $1.1 billion at December 31, 2024.

Critical Accounting Estimates

In preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and revenues and expenses for the period.

Our accounting and reporting estimates are in accordance with generally accepted accounting principles, or “U.S.

GAAP,” and conform to general practices within the banking industry.

Estimates that are susceptible to significant changes include accounting for the allowance for credit losses and fair value measurements, both of which require significant judgments by management.

Actual results could result in material changes to our consolidated financial condition or consolidated results of operations.

Our accounting and reporting estimates are in accordance with U.S.

generally accepted accounting principles, or “GAAP,” and conform to general practices within the banking industry.

Changes in underlying factors, estimates, assumptions or judgments could result in material changes in our consolidated financial position and/or results of operations.

Certain policies inherently have a greater reliance on the use of estimates, assumptions and judgments and, as such, have a greater possibility of producing results that could be materially different than originally reported.

We have identified the determination of the allowance for credit losses and fair value measurements to be the accounting areas that require the most subjective or complex judgments and, as such, could be most subject to revision as new or additional information becomes available or circumstances change, including overall changes in the economic climate and/or market interest rates.

We have identified the determination of the allowance for credit losses (“ACL”) and fair value measurement of MSRs to be the accounting areas that require the most subjective or complex judgments and, as such, could be most subject to revision as new or additional information becomes available or circumstances change, including overall changes in the economic climate and/or market interest rates.

Therefore, we consider these policies to be critical accounting estimates and discuss them directly with the Audit Committee of our Board of Directors.

These critical accounting estimates and their application are reviewed at least annually by our audit committee.

The following is a description of our critical accounting estimates and an explanation of the methods and assumptions underlying their application.

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Management derives the economic forecasts it uses in its ACL model from Moody’s Analytics.

The latter has a large team of economics, database managers and operational engineers with a history of producing monthly economic forecasts for over 25 years.

The latter has a large team of economists, database managers and operational engineers with a history of producing monthly economic forecasts for over 25 years.

Management has currently set an initial forecast period (“reasonable and supportable period”) of four years and a reversion period of one year, utilizing a straight-line approach and reverting back to the historical macroeconomic mean.

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December 31, 2025, and the importance and levels of the qualitative factors applied, may change in future periods depending on the level of changes to items such as the uncertainty of economic conditions and management’s assessment of the level of credit risk within the loan portfolio as a result of such changes, compared to the amount of ACL calculated by the model.

The evaluation of qualitative factors is inherently imprecise and requires significant management judgement.

The evaluation of qualitative factors is inherently imprecise and requires significant management judgment.

The ACL can also be impacted by factors outside of management’s control, which include unanticipated changes in asset quality of the portfolio, such as deterioration in borrower delinquencies, or credit scores in our residential real estate and consumer portfolio.

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Our process for determining ACL is further discussed in “ Note 1- Basis of Presentation, Description of Business and Summary of Significant Accounting Policies ” included in Item 8 of this Form 10-K.

Additionally, as an “emerging growth company” under Section 107 of the JOBS Act, we adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326) (CECL) on January 1, 2023.

As such, our allowance for credit losses for years prior to 2023 may not be comparable to other public financial institutions that adopted CECL in an earlier year.

Fair Value Measurement of MSRs - Our residential mortgage servicing rights are measured at fair value on a recurring basis.

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Comparison of fiscal years 2025 and 2024

The follow table sets forth our results of operations as of and for the year ended December 31,:

The following table sets forth our results of operations as of and for the year ended December 31,:

($ in thousands, except per share amounts) 2025 2024 2023

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Our results of operations depend significantly on net interest income, which is the difference between interest income on interest-earning assets, consisting primarily of interest income on loans and investment securities and interest expense on interest-bearing liabilities, consisting primarily of deposits and borrowings.

Our results of operations are also dependent on our generation of noninterest income, consisting primarily of income from mortgage banking services, service charges on deposit accounts, trust and investment advisory fees and credit and debit card fees.

Our results of operations are also dependent on our generation of noninterest income, consisting primarily of mortgage banking services, deposit account service fees, trust and investment advisory fees and credit and debit card fees.

Other factors contributing to our results of operations include our provisions for credit losses, income taxes, and noninterest expenses, such as salaries and employee benefits, occupancy and equipment, amortization of intangible assets and other operating costs.

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Loan origination fees and certain direct origination costs are capitalized and recognized as an adjustment of the yield on the related loan.

Non-PCD loans acquired are initially recorded at fair value and the resulting discount or premium are recognized as an adjustment of the yield on the related loans.

Non-PCD loans acquired are initially recorded at fair value and the resulting discount or premium is recognized as an adjustment of the yield on the related loans.

Our net interest income can be significantly influenced by a variety of factors, including overall loan demand, economic conditions, credit risk, the amount of non-earning assets including nonperforming loans and OREO, the amounts of and rates at which assets and liabilities reprice, variances in prepayment of loans and securities, exercise of call options on borrowings or securities, a general rise or decline in interest rates, changes in the slope of the yield curve, and balance sheet growth or contraction.

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Interest income on loans increased by $3.5 million in 2025, compared to 2024.

Interest income on investment securities increased by $1.4 million in 2024, compared to 2023.

Interest expense from total interest-bearing liabilities increased by $42.4 million in 2024, compared to 2023.

Our net interest margin decreased 17 basis points to 4.06% in 2024, compared to 2023.

Results in 2024, compared to the prior year, were driven by an increase of 66 basis points in the cost of interest-bearing liabilities, partially offset by an increase of 32 basis points in yield on earning assets.

Total average loans, including loans held-for-sale, grew to $6.4 billion in 2024, an increase of $0.2 billion, or 3.8%, compared to 2023, primarily due to organic growth in our loan portfolios.

Yield on loans increased 34 basis points in 2024, compared to 2023, primarily due to higher yields on new originations as compared to amortizing and maturing balances.

Interest income on investment securities decreased by $1.0 million in 2025, compared to 2024.

Interest income on cash and other assets increased $5.7 million in 2025, compared to 2024.

Interest expense from total interest-bearing liabilities decreased by $12.3 million in 2025, compared to 2024.

Our net interest margin increased four basis points to 4.10% in 2025, compared to 2024.

The increase in 2025, compared to the prior year, was driven by a decrease of 36 basis points in the cost of interest-bearing liabilities, partially offset by a decrease of 24 basis points in yield on earning assets.

Total average loans, including loans held-for-sale, grew to $6.6 billion in 2025, an increase of $0.2 billion, or 3.5%, compared to 2024, due to organic growth in our loan portfolios.

Yield on loans decreased 17 basis points in 2025, compared to 2024, primarily due to the declining interest rate environment and its impact on variable rate loans in our loan portfolio.

Average interest-bearing cash and other assets, grew to $0.6 billion in 2025, an increase of $0.2 billion.

Yield on interest-bearing cash and other assets decreased 88 basis points in 2025, compared to 2024, primarily due to the declining interest rate environment.

Average interest-bearing liabilities grew to $5.4 billion in 2025, an increase of $0.2 billion, or 4.3%, compared to 2024, primarily to support the growth in our loan portfolio.

Average interest-bearing deposits increased $0.4 billion, or 7.2%, in 2025, compared to 2024.

Total cost of deposits increased by 76 basis points to 3.03% in 2024, compared to 2023, primarily due to continued intense competition for deposits amidst the elevated interest rate environment and an increase in certificates of deposit balances.

Total cost of deposits decreased by 30 basis points to 2.73% in 2025, compared to 2024, primarily due to a decrease in balances and rates for certificates of deposit amidst the declining interest rate environment, partially offset by an increase in promotional rate money market deposit balances.

Average FHLB borrowings decreased $117.0 million in 2025, compared to 2024.

The cost of FHLB borrowings increased by 43 basis points to 5.48% in 2024, compared to 2023.

The following tables set forth information related to our average balance sheet, average yields on assets, and average costs of liabilities for the periods presented.

The cost of FHLB borrowings decreased by 87 basis points to 4.61% in 2025, compared to 2024.

The following table sets forth information related to our average balance sheet, average yields on assets, and average costs of liabilities for the periods presented.

We derived these yields by dividing income or expense by the average balance of the corresponding assets or liabilities.

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Money market deposits 2,709,997 64,945 2.40 % 2,161,618 45,643 2.11 % 2,122,410 28,301 1.33 %

Certificates of deposits 1,756,755 79,161 4.51 % 1,512,638 58,804 3.89 % 536,325 3,810 0.71 %

Certificates of deposit 1,432,539 53,139 3.71 % 1,756,755 79,161 4.51 % 1,512,638 58,804 3.89 %

Total deposits 5,322,084 145,338 2.73 % 4,964,437 150,651 3.03 % 4,474,126 101,355 2.27 %

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Rate-Volume Analysis

The tables below present the effect of volume and rate changes on interest income and expense.

The table below presents the effect of volume and rate changes on interest income and expense.

Changes in volume are changes in the average balance multiplied by the previous period’s average rate.

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Money market deposits 6,703 12,599 19,302 16,810 532 17,342

Certificates of deposits 10,107 10,250 20,357 39,086 15,908 54,994

Certificates of deposit (12,732) (13,290) (26,022) 10,107 10,250 20,357

Total deposits (9,588) 4,275 (5,313) 30,089 19,207 49,296

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The allowance for credit losses is increased by the provision for credit losses and is decreased by charge-offs, net of recoveries on prior loan charge-offs.

The provision for credit losses totaled $27.6 million in 2024, an increase of $9.3 million compared to 2023, primarily due to a $13.6 million provision for credit loss on a specific customer in our commercial and industrial (C&I) loan portfolio in 2024.

The provision for credit losses totaled $24.6 million in 2025, primarily due to a combination of deterioration of two customer relationships in our commercial and industrial (C&I) portfolio, impacts from net portfolio downgrades, and impacts from growth in loan portfolio balances.

Net charge-offs in 2025 were $28.3 million, or a ratio of net charge-offs to average loans of 0.43%, compared to net charge-offs of $20.4 million, or a ratio of net charge-offs to average loans of 0.32%, in 2024.

The increase in net charge-offs in 2024 is primarily due to a $16.7 million net charge-off on a specific customer in our C&I loan portfolio.

Net charge-offs in 2025 were elevated primarily due to write-downs of two customer relationships in our C&I loan portfolio.

The allowance for credit losses as a percentage of total loans was 1.27% at December 31, 2025, compared to 1.38% at December 31, 2024.

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(In thousands) 2025 2024 2023

Service charges on deposit accounts $ 9,495 $ 9,940 $ 9,857

Deposit account service fees $ 8,321 $ 9,495 $ 9,940

Treasury management service fees 17,473 14,829 11,724

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Trust and investment advisory fees 5,945 5,787 5,693

Income from mortgage banking services, net 39,014 31,384 46,285

Other 9,514 8,670 6,753

Mortgage banking services, net 47,072 39,014 31,384

Other noninterest income 12,339 9,514 8,670

Total noninterest income $ 101,879 $ 89,792 $ 79,092

Noninterest income totaled $89.8 million in 2024, an increase of $10.7 million from 2023, primarily due to increases in treasury management service fees and income from mortgage banking services, net.

Service charges on deposit accounts includes overdraft and non-sufficient funds charges, and other maintenance fees on deposit accounts.

Service charges on deposit accounts decreased $0.4 million for the year ended December 31, 2024 compared to 2023, primarily due to a decrease in insufficient funds and overdraft fees.

Noninterest income totaled $101.9 million in 2025, an increase of $12.1 million from 2024, primarily due to increases in mortgage banking services, treasury management service fees, and other noninterest income.

Deposit account service fees include overdraft and non-sufficient funds charges, and other maintenance fees on deposit accounts.

Deposit account service fees decreased $1.2 million for the year ended December 31, 2025 compared to 2024, primarily due to a decrease in overdraft and non-sufficient funds charges.

Treasury management service fees include financial information management, accounts receivable management, accounts payable services, fraud mitigation services, and cash flow management.

Treasury management service fees increased $3.1 million, primarily due to an overall increase in our business customer base as well as an increase in products and services provided to our existing customer base.

Treasury management service fees increased $2.6 million, primarily due to growth in services provided to our business customers.

Credit and debit card fees represent interchange income from credit and debit card activity and referral fees earned from processing fees on card transactions by our business customers.

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Trust and investment advisory fees increased $0.2 million for the year ended December 31, 2025 compared to 2024, primarily due to higher average assets under management.

The components of income from mortgage banking services, net, were as follows for the year ended December 31,:

The components of mortgage banking services, were as follows for the year ended December 31,:

(In thousands) 2025 2024 2023

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Mortgage servicing income 18,667 16,973 15,674

MSR capitalization and changes in fair value, net of derivative activity 3,186 1,435 12,273

Income from mortgage banking services, net $ 39,014 $ 31,384 $ 46,285

Income from mortgage banking services increased $7.6 million in 2024, compared to 2023.

We experienced an increase of $4.6 million in 2024, compared to 2023, in revenue related to net sale gains and fees from mortgage loan originations, including fair value changes in the held-for-sale portfolio and hedging activity.

Total loan originations for sale were $1.1 billion in 2024, an increase of $0.3 billion from $0.8 billion in 2023.

Net MSR capitalization and changes in fair value, net of derivative activity 4,498 3,186 1,435

Mortgage banking services, net $ 47,072 $ 39,014 $ 31,384

Mortgage banking services increased $8.1 million in 2025, compared to 2024.

We experienced an increase of $5.1 million in 2025, compared to 2024, in revenue related to net sale gains and fees from mortgage loan originations, including fair value changes in the held-for-sale portfolio and hedging activity primarily due to an increase in gain on sales driven by higher origination volume.

We retain servicing rights on the majority of mortgage loans that we sell, which drove the increase in servicing income of $1.7 million to $18.7 million in 2025, from $17.0 million in 2024.

MSR capitalization and changes in fair value, net of derivative activity, increased $1.8 million in 2024, compared to 2023.

Revenue was higher in 2024, compared to 2023 due to an increase in MSR capitalization of $3.0 million partially offset by a decrease in MSR fair value, net of derivative activity of $1.2 million.

Net MSR capitalization and changes in fair value, net of derivative activity, increased $1.3 million in 2025, compared to 2024.

Revenue was higher in 2025, compared to 2024 due to an increase in net MSR capitalization of $2.3 million partially offset by a decrease in MSR fair value, net of derivative activity of $1 million.

We recognize fair value adjustments to our MSR asset, which includes changes in assumptions to the valuation model and pay-offs and pay-downs of the MSR portfolio.

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We also maintain a hedging strategy to manage a portion of the risk associated with changes in the fair value of our MSR portfolio.

Changes in fair value of the derivative instruments used to economically hedge the MSRs are also included as a component of income from mortgage banking services.

Other noninterest income increased $0.8 million for the year ended December 31, 2024 compared to 2023, primarily due to an increase in the cash surrender value of BOLI.

Changes in fair value of the derivative instruments used to economically hedge the MSRs are also included as a component of mortgage banking services.

Other noninterest income increased $2.8 million for the year ended December 31, 2025 compared to 2024, primarily due to an increase in loan syndication fees and swap fee income.

Noninterest Expense

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Salary and employee benefits $ 171,824 $ 154,985 $ 133,231

Occupancy and equipment 36,282 33,426 31,344

Amortization of intangible assets 3,549 4,822 4,215

Terminated merger related expenses 13,178 — —

Occupancy, equipment and software 38,244 36,282 33,426

Amortization and impairment of intangible assets 2,412 3,549 4,822

Merger related expenses 2,743 13,178 —

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Total noninterest expenses $ 271,774 $ 264,040 $ 222,793

Noninterest expenses totaled $264.0 million in 2024, an increase of $41.2 million from 2023, primarily due to an increase in salaries and benefits of $21.8 million as a result of increased head count of C&I bankers and higher levels of variable compensation associated with an increase in mortgage loan originations.

Noninterest expense in 2024 included terminated merger related expenses of $13.2 million.

Additional non-recurring expenses include $2.0 million of costs to dispose of a majority of our ATMs and amend our associated service contract as we move to participating in a national ATM network, and a $0.8 million write-off of the Guardian Mortgage trade name as we are in the process of rebranding our residential mortgage business as Sunflower Bank Mortgage Lending.

Adjusted noninterest expense, a non-GAAP financial measure, totaled $248.0 million in 2024, an increase of $25.2 million from 2023.

Noninterest expenses totaled $271.8 million in 2025, an increase of $7.7 million from 2024, primarily due to an increase in salary and employee benefits due to the higher headcount of C&I bankers and support personnel, higher levels of variable compensation, including compensation associated with an increase in mortgage loan originations, and higher medical insurance costs, partially offset by a decrease in merger related expenses of $10.4 million in 2025 compared to 2024.

The efficiency ratio for 2025 was 64.82% compared to 68.28% in 2024.

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We had income tax expense in 2025 of $25.0 million, compared to $19.5 million in 2024.

The decrease in income tax expense was primarily due to our decreased income during 2024.

The increase in income tax expense was primarily due to our increased income during 2025.

Our effective tax rate was 20.3% in 2025, compared to 20.5% in 2024.

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The decrease was primarily due to amortization of the portfolio.

Securities held-to-maturity decreased $1.7 million to $35.2 million at December 31, 2024, compared to December 31, 2023, due to amortization of the portfolio.

Securities held-to-maturity decreased $1.4 million to $33.8 million at December 31, 2025, compared to December 31, 2024, due primarily to amortization of the portfolio.

The following table is a summary of our investment portfolio as of December 31,:

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(In thousands) 2025 2024 2023

Balance, beginning of period $ 80,398 $ 65,917 $ 47,547

Balance, beginning of year $ 88,221 $ 80,398 $ 65,917

Impact of adopting ASC 326 — — 5,256

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Consumer (447) (438) (334)

Other (743) — —

Total loan charge-offs (28,986) (21,694) (9,672)

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Total loan recoveries 731 1,317 1,862

Net (charge-offs) recoveries (20,377) (7,810) 320

Net loan charge-offs (28,255) (20,377) (7,810)

Provision for credit losses 1

25,050 28,200 17,035

Balance, end of period $ 88,221 $ 80,398 $ 65,917

Balance, end of year $ 85,016 $ 88,221 $ 80,398

Allowance for credit losses to total loans 1.27 % 1.38 % 1.28 %

Ratio of net charge-offs to average loans outstanding 0.43 % 0.32 % 0.13 %

1 For the years ended December 31, 2024, 2023 and 2022 we recorded a provision for credit losses on unfunded commitments of $(650), $1,212 and $525, respectively.

1 For the years ended December 31, 2025, 2024 and 2023 we recorded a (benefit) provision for credit losses on unfunded commitments of $(450), $(650) and $1,212, respectively.

For further information, see Note 3 - Loans .

The following table presents net charge-offs (recoveries) to average loans outstanding by loan category for the years ended December 31,:

The following table presents net charge-offs to average loans outstanding by loan category for the years ended December 31,:

(In thousands) 2025 2024 2023

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Other 1.43 % — % — %

Total 0.43 % 0.32 % 0.13 %

Allocation of Allowance for Credit Losses

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Interest-bearing deposit accounts:

Demand and NOW deposits 61,987 36,162

Savings deposits 326,916 343,291

Money market deposits 1,516,577 1,196,645

Certificates of deposits 1,069,704 1,437,537

Demand and NOW 110,155 61,987

Savings 308,655 326,916

Money market 1,880,973 1,516,577

Certificates of deposit 809,401 1,069,704

Total interest-bearing deposit accounts 3,109,184 2,975,184

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Interest-bearing deposit accounts:

Demand and NOW deposits 669,417 555,197

Savings deposits 75,422 80,802

Money market deposits 915,208 825,811

Certificates of deposits 51,131 87,407

Demand and NOW 738,506 669,417

Savings 69,976 75,422

Money market 1,056,044 915,208

Certificates of deposit 57,349 51,131

Total interest-bearing deposit accounts 1,921,875 1,711,178

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Total deposits $ 7,107,356 $ 6,672,260

1 Wholesale deposits consist of brokered deposits included in our consolidated balance sheets within interest-bearing accounts and in Note 9 - Deposits within certificates of deposits and savings and money market accounts.

(Dollars in thousands) Average

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Balance Average

Noninterest-bearing demand deposit accounts $ 1,542,808 — % $ 1,678,240 — %

Noninterest-bearing deposit accounts $ 1,615,511 — % $ 1,542,808 — %

Interest-bearing deposit accounts:

Interest-bearing demand accounts 592,381 3.79 % 344,242 3.26 %

Savings accounts and money market accounts 2,574,559 1.88 % 2,576,064 1.20 %

NOW accounts 40,742 1.34 % 41,182 0.82 %

Certificate of deposit accounts 1,756,755 4.51 % 1,512,638 3.89 %

Demand and NOW 785,777 3.18 % 633,123 3.63 %

Savings 393,771 0.57 % 412,941 0.69 %

Money market 2,709,997 2.40 % 2,161,618 2.11 %

Certificates of deposit 1,432,539 3.71 % 1,756,755 4.51 %

Total interest-bearing deposit accounts 5,322,084 2.73 % 4,964,437 3.03 %

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As of December 31, 2025 and December 31, 2024, approximately $2.1 billion or 29.0% and $1.7 billion or 25.2%, respectively, of our deposit portfolio was uninsured and uncollateralized.

The uninsured and uninsured and uncollateralized amounts are estimates based on the methodologies and assumptions used for the Bank's regulatory reporting requirements.

The uninsured and uncollateralized amounts are estimates based on the methodologies and assumptions used for the Bank’s regulatory reporting requirements.

We actively participate in the IntraFi Cash Service (“ICS”) / Certificate of Deposit Account Registry Service (“CDARS”) program which provides FDIC insurance coverage for clients that maintain larger deposit balances.

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At December 31, 2025, the Bank could pay dividends to FirstSun of approximately $268.3 million without prior regulatory approval.

During the year ended December 31, 2024, the Bank did not pay a dividend to FirstSun.

During the year ended December 31, 2024, Logia paid dividends totaling $0.7 million to FirstSun.

During the year ended December 31, 2025, the Bank paid dividends totaling $7.6 million to FirstSun.

During the year ended December 31, 2025, Sunflower Wealth Advisors, LLC paid dividends totaling $0.2 million to FirstSun.

The Bank’s liquidity management policy and our asset and liability management policy, or ALM policy, provides the framework that we use to seek to maintain adequate liquidity and sources of available liquidity at levels that will enable us to meet all reasonably foreseeable short-term, long-term and strategic liquidity demands.

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Liquidity management is made more complicated because different balance sheet components are subject to varying degrees of management control.

For example, the timing of maturities of our investment portfolio is fairly predictable and subject to a high degree of control when we make investment decisions.

For example, the timing of maturities of our

investment portfolio is fairly predictable and subject to a high degree of control when we make investment decisions.

Net deposit inflows and outflows, however, are far less predictable and are not subject to the same degree of certainty.

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At December 31, 2025, loans as a percentage of customer deposits were 93.9%, compared with 95.6% at December 31, 2024.

For additional information related to our deposits, see Deposits section above.

For additional information related to our deposits, see the “Deposits” section above.

We are also a member of the FHLB and FRB, from which we can borrow for leverage or liquidity purposes.

The FHLB and FRB requires that securities and qualifying loans be pledged to secure any advances.

The FHLB and FRB require that securities and qualifying loans be pledged to secure any advances.

Liquidity sources available to us for immediate funding at December 31, 2025, are as follows:

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Management believes the Bank has the ability to generate and obtain adequate amounts of liquidity to meet its requirements in the short-term and the long-term.

Stockholders’ equity at December 31, 2024 was $1,041.4 million, compared to $877.2 million at 2023, an increase of $164.2 million, or 18.7%.

The increase in stockholders’ equity relates primarily to net income for the year ended December 31, 2024 and issuance of FirstSun common stock in January 2024.

Stockholders’ equity at December 31, 2025 was $1.2 billion, compared to $1.0 billion at 2024, an increase of $0.1 billion, or 10.8%.

The increase in stockholders’ equity relates primarily to net income for the year ended December 31, 2025.

We did not pay a dividend to our common shareholders during the years ended December 31, 2025 or 2024.

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Securities sold under agreements to repurchase 10 11,160 11,160 — — —

Short-term debt:

FHLB term advances 11 135,000 135,000 — — —

Long-term debt:

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

What changed 10-K

Item 7. Management’s Discussion and Analysis