HORIZON BANCORP INC /IN/ 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA HORIZON BANCORP, INC. AND SUBSIDIARIES Consolidated Financial Statements Table of Contents Page Consolidated Financial Statements Consolidated Balance Sheets 64 Consolidated Statements of Income 65 Consolidated Statements of Comprehensive Income (Loss) 66 Consolidated Statements of Stockholders’ Equity 67 Consolidated Statements of Cash Flows 68 Notes to Condensed Consolidated Financial Statements 70 Reports of Independent Registered Public Accounting Firm (PCAOB ID: 686 ) 136 Management’s Report on Financial Statements 139 63 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Consolidated Balance Sheets (Dollar Amounts in Thousands) December 31 2025 December 31 2024 Assets Cash and due from banks $ 66,813 $ 92,300 Interest-bearing deposits in banks 72,646 201,131 Total cash and cash equivalents 139,459 293,431 Interest earning time deposits — 735 Investment securities, held for trading 3,883 — Investment securities, available for sale 875,414 233,677 Investment securities, held to maturity (fair value of $ 0 and $ 1,566,268 ) — 1,867,690 Loans held for sale 9,778 67,597 Loans, net of allowance for credit losses of $ 51,299 and $ 51,980 4,825,243 4,795,060 Premises and equipment, net 92,805 93,864 Federal Home Loan Bank stock 45,713 53,826 Goodwill 155,211 155,211 Other intangible assets 7,180 10,223 Interest receivable 29,733 39,747 Cash value of life insurance 36,732 37,450 Other assets 215,460 152,635 Total assets $ 6,436,611 $ 7,801,146 Liabilities Deposits Non-interest bearing $ 1,078,708 $ 1,064,818 Interest bearing 4,196,709 4,535,834 Total deposits 5,275,417 5,600,652 Short and long term borrowings 248,586 1,232,252 Subordinated notes, net 98,215 55,738 Junior subordinated debentures issued to capital trusts 57,688 57,477 Interest payable 12,892 11,137 Other liabilities 55,562 80,308 Total liabilities 5,748,360 7,037,564 Commitments and contingent liabilities Stockholders’ Equity Preferred stock, Authorized, 1,000,000 shares, Issued 0 shares — — Common stock, no par value, Authorized 99,000,000 shares 51,217,433 and 44,226,819 shares issued at December 31, 2025 and December 31, 2024, respectively — — Additional paid-in capital 459,243 363,761 Retained earnings 255,004 436,122 Accumulated other comprehensive loss ( 25,996 ) ( 36,301 ) Total stockholders’ equity 688,251 763,582 Total liabilities and stockholders’ equity $ 6,436,611 $ 7,801,146 See accompanying Notes to Consolidated Financial Statements 64 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Consolidated Statements of Income (Dollar Amounts in Thousands, Except Per Share Data) Year Ended December 31 2025 2024 2023 Interest Income Interest and fees on loans $ 309,874 $ 291,069 $ 244,544 Investment securities - taxable 26,299 30,295 34,410 Investment securities - tax exempt 19,359 25,439 28,384 Other 7,245 9,680 4,967 Total interest income 362,777 356,483 312,305 Interest Expense Deposits 98,607 115,042 85,857 Short and long term borrowings 25,033 44,930 42,478 Subordinated notes 5,201 3,319 3,511 Junior subordinated debentures issued to capital trusts 4,452 4,588 4,715 Total interest expense 133,293 167,879 136,561 Net Interest Income 229,484 188,604 175,744 Credit loss expense 1,896 5,389 2,459 Net Interest Income after Provision for Credit Losses 227,588 183,215 173,285 Non-interest (Loss) Income Service charges on deposit accounts 13,231 12,940 12,227 Wire transfer fees 277 461 448 Interchange fees 13,599 13,799 12,861 Fiduciary activities 5,501 5,394 5,080 Loss on sale of investment securities ( 299,538 ) ( 39,140 ) ( 32,052 ) Gain on sale of mortgage loans 4,799 4,215 4,323 Mortgage servicing income net of impairment 1,463 1,677 2,708 Increase in cash value of bank owned life insurance 1,420 1,300 3,709 Other income 2,798 2,325 2,694 Total non-interest (loss) income ( 256,450 ) 2,971 11,998 Non-interest Expense Salaries and employee benefits 89,737 88,244 80,809 Net occupancy expenses 13,867 13,376 13,355 Data processing 11,884 10,861 11,626 Professional fees 3,452 2,733 2,645 Outside services and consultants 13,422 14,564 9,942 Loan expense 4,340 4,076 4,980 FDIC insurance expense 5,100 5,032 3,880 Core deposit intangible amortization 3,044 3,403 3,612 Merger related expense 305 — — Prepayment penalties 12,680 — — Other losses 1,336 1,199 1,051 Other expense 13,124 15,348 14,384 Total non-interest expense 172,291 158,836 146,284 Income (Loss) Before Income Taxes ( 201,153 ) 27,350 38,999 Income tax expense (benefit) ( 50,671 ) ( 8,079 ) 11,018 Net Income (Loss) Available to Common Shareholders $ ( 150,482 ) $ 35,429 $ 27,981 Basic Earnings Per Share $ ( 3.24 ) $ 0.81 $ 0.64 Diluted Earnings Per Share ( 3.24 ) 0.80 0.64 See accompanying Notes to Consolidated Financial Statements 65 Table of Contents Horizon Bancorp, Inc. and Subsidiaries Consolidated Statements of Comprehensive Income (Loss) (Dollar Amounts in Thousands) Year Ended December 31 2025 2024 2023 Net Income (loss) $ ( 150,482 ) $ 35,429 $ 27,981 Other Comprehensive Income (Loss) Change in fair value of derivative instruments: Change in fair value of derivative instruments for the period — — ( 523 ) Reclassification adjustment for swap termination (gains) realized in income — — ( 1,453 ) Income tax effect — — 415 Changes from derivative instruments — — ( 1,561 ) Change in securities: Unrealized gain (loss) for the period on AFS securities ( 284,181 ) ( 120 ) 20,728 Amortization from transfer of securities from available for sale to held to maturity securities ( 2,395 ) ( 657 ) ( 691 ) Reclassification adjustment for securities (gains) losses realized in income 299,538 39,140 32,052 Income tax effect ( 2,657 ) ( 8,055 ) ( 10,939 ) Unrealized gains (losses) on securities 10,305 30,308 41,150 Other Comprehensive Income (Loss), Net of Tax 10,305 30,308 39,589 Comprehensive Income (Loss) $ ( 140,177 ) $ 65,737 $ 67,570 See accompanying Notes to Consolidated Financial Statements 66 Table of Contents Horizon Bancorp, Inc. and Subsidiaries Consolidated Statements of Stockholders’ Equity (Dollar Amounts in Thousands, Except Per Share Data) Preferred Stock Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Balances, January 1, 2023 $ — $ — $ 354,188 $ 429,385 $ ( 106,198 ) $ 677,375 Net income — — — 27,981 — 27,981 Other comprehensive income, net of tax — — — — 39,589 39,589 Amortization of unearned compensation — — 3,586 — — 3,586 Net settlement of share awards — — ( 1,221 ) — — ( 1,221 ) Stock retirement plans — — ( 153 ) — — ( 153 ) Cash dividends on common stock ($ 0.64 per share) — — — ( 28,345 ) — ( 28,345 ) Balances, December 31, 2023 $ — $ — $ 356,400 $ 429,021 $ ( 66,609 ) $ 718,812 Net income — — — 35,429 — 35,429 Other comprehensive income, net of tax — — — — 30,308 30,308 Amortization of unearned compensation — — 4,586 — — 4,586 Net settlement of share awards — — ( 1,371 ) — — ( 1,371 ) Stock retirement plans — — 4,146 — — 4,146 Cash dividends on common stock ($ 0.64 per share) — — — ( 28,328 ) — ( 28,328 ) Balances, December 31, 2024 $ — $ — $ 363,761 $ 436,122 $ ( 36,301 ) $ 763,582 Net income (loss) — — — ( 150,482 ) — ( 150,482 ) Other comprehensive income, net of tax — — — — 10,305 10,305 Amortization of unearned compensation — — 1,621 — — 1,621 Net settlement of share awards — — ( 4,089 ) — — ( 4,089 ) Issuance of common stock ( 7,138,050 shares), net of expenses — — 97,950 — — 97,950 Cash dividends on common stock ($ 0.64 per share) — — — ( 30,636 ) — ( 30,636 ) Balances, December 31, 2025 $ — $ — $ 459,243 $ 255,004 $ ( 25,996 ) $ 688,251 See accompanying Notes to Consolidated Financial Statements 67 Table of Contents Horizon Bancorp, Inc. and Subsidiaries Consolidated Statements of Cash Flows (Dollar Amounts in Thousands) Year Ended December 31 2025 2024 2023 Operating Activities Net income (loss) $ ( 150,482 ) $ 35,429 $ 27,981 Items not requiring (providing) cash Provision for credit losses 1,896 5,389 2,459 Depreciation and amortization 10,304 10,331 10,938 Share based compensation 1,621 4,586 3,586 Amortization of mortgage servicing rights 2,095 1,971 1,032 Net amortization of premiums and discounts on securities 2,397 8,407 10,069 Purchases of securities held for trading ( 5,958 ) — — Proceeds from maturities, calls and principal repayments of securities held for trading 2,100 — — Deferred income taxes ( 85,472 ) ( 17,000 ) ( 3,322 ) Loss on sale of investment securities 299,538 39,140 32,052 Gain on sale of mortgage loans ( 4,799 ) ( 4,215 ) ( 4,323 ) Net loss on sale of portfolio loans 324 — — Proceeds from sales of loans 164,460 435,522 145,922 Loans originated for sale ( 164,794 ) ( 499,688 ) ( 138,430 ) Gain on cash value life insurance ( 1,987 ) ( 1,300 ) ( 3,709 ) Gain on other real estate owned ( 69 ) ( 450 ) ( 300 ) Net change in: Interest receivable 10,014 ( 1,037 ) ( 3,416 ) Interest payable 1,755 ( 11,112 ) 16,869 Other assets 21,874 ( 9,698 ) 13,199 Other liabilities ( 25,586 ) 10,093 ( 21,671 ) Net cash provided by operating activities 79,231 6,368 88,936 Investing Activities Purchases of securities available for sale ( 591,807 ) — ( 1,525 ) Proceeds from sales of securities available for sale 1,409,870 293,138 439,285 Proceeds from maturities, calls and principal repayments of securities available for sale 55,147 16,712 29,408 Purchases of securities held to maturity — ( 312 ) ( 10,141 ) Proceeds from maturities of securities held to maturity 63,783 71,649 80,201 Net change in interest-earning time deposits 735 1,470 607 Purchase of FHLB stock ( 301 ) ( 19,317 ) ( 7,832 ) Redemption of FHLB stock 8,414 — — Purchase of loans — ( 240,020 ) ( 124,946 ) Proceeds from sale of portfolio loans 228,892 — — Net change in loans ( 193,893 ) ( 217,055 ) ( 140,510 ) Proceeds on the sale of OREO and repossessed assets 895 2,000 2,981 Premises and equipment expenditures ( 4,956 ) ( 5,084 ) ( 7,775 ) Proceeds from bank owned life insurance 2,705 44,043 69,765 Net cash provided by (used in) investing activities 979,484 ( 52,776 ) 329,518 Financing Activities Net change in deposits ( 325,235 ) ( 64,241 ) ( 192,881 ) Proceeds from borrowings 140,296 512,759 866,099 Repayment of borrowings ( 1,132,392 ) ( 563,523 ) ( 654,157 ) 68 Table of Contents Net change in repurchase agreements ( 1,444 ) ( 46,118 ) ( 1,841 ) Proceeds from issuance of subordinated notes, net 98,215 — — Repayment of subordinated notes ( 56,500 ) — ( 3,132 ) Net settlement of share awards ( 4,089 ) ( 1,371 ) ( 1,221 ) Proceeds from sale of SERP shares — 4,146 — Proceeds from issuance of common stock, net 97,950 — — Dividends paid on common stock ( 29,488 ) ( 28,328 ) ( 28,311 ) Net cash used in financing activities ( 1,212,687 ) ( 186,676 ) ( 15,444 ) Net Change in Cash and Cash Equivalents ( 153,972 ) ( 233,084 ) 403,010 Cash and Cash Equivalents, Beginning of Period 293,431 526,515 123,505 Cash and Cash Equivalents, End of Period $ 139,459 $ 293,431 $ 526,515 Additional Supplemental Information Interest paid $ 131,538 $ 178,891 $ 119,692 Income taxes paid 27,407 10,710 2,137 Transfer of loans to other real estate and repossessed assets 3,643 2,690 3,299 Transfer of held to maturity securities to available for sale 1,798,361 — — Transfer of LHI to HFS 184,092 87,638 — Redemption of cash value of life insurance, not settled — — 43,962 Cash dividends declared, not paid 8,228 7,081 7,156 Qualified affordable housing investments obtained in exchange for funding commitments — — 14,491 See notes to consolidated financial statements 69 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Note 1 – Nature of Operations and Summary of Significant Accounting Policies Nature of Business — The consolidated financial statements of Horizon Bancorp, Inc. (“Horizon”) and its wholly owned subsidiary, Horizon Bank (“Bank”) together referred to as “Horizon,” conform to accounting principles generally accepted in the United States of America and reporting practices followed by the banking industry. The Bank is a full–service commercial bank offering a broad range of commercial and retail banking and other services incident to banking along with a trust department that offers corporate and individual trust and agency services and investment management services. The Bank maintains 71 full service offices. The Bank has wholly owned direct and indirect subsidiaries: Horizon Investments, Inc. (“Horizon Investments”), Horizon Properties, Inc. (“Horizon Properties”), Horizon Insurance Services, Inc. (“Horizon Insurance”) and Horizon Grantor Trust. Horizon Investments manages the investment portfolio of the Bank. Horizon Properties manages the real estate investment trust. Horizon Insurance is used by the Company’s Wealth Management to sell certain insurance products. Horizon Grantor Trust holds title to certain company owned life insurance policies. Horizon conducts no business except that incident to its ownership of the subsidiaries. Horizon formed Horizon Bancorp Capital Trust II in 2004 (“Trust II”) and Horizon Bancorp Capital Trust III in 2006 (“Trust III”) for the purpose of participating in pooled trust preferred securities offerings. The Company assumed additional debentures as the result of the following acquisitions: Alliance Financial Corporation in 2005, which formed Alliance Financial Statutory Trust I (“Alliance Trust”); American Trust & Savings Bank in 2010, which formed Am Tru Statutory Trust I (“Am Tru Trust”); Heartland Bancshares, Inc. in 2013, which formed Heartland (IN) Statutory Trust II (“Heartland Trust”); LaPorte Bancorp, Inc. in 2016, which had acquired City Savings Statutory Trust I (“City Savings Trust”); and Salin Bancshares, Inc. in 2019, which formed Salin Statutory Trust I (“Salin Trust”). See Note 13 of the Consolidated Financial Statements for further discussion regarding these previously consolidated entities that are now reported separately. The business of Horizon is not seasonal to any material degree. Basis of Reporting — The consolidated financial statements include the accounts of Horizon and subsidiaries. All material inter-company accounts and transactions have been eliminated in consolidation. Use of Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. The allowance for credit losses and the fair values of financial instruments are particularly subject to change. Business Combinations — Business combinations are accounted for using the acquisition method of accounting. The accounts of an acquired entity are included as of the date of acquisition, and any excess of purchase price over the fair value of the net assets acquired is capitalized as goodwill. Horizon typically issues Common Stock and/or pays cash for an acquisition, depending on the terms of the acquisition agreement. The value of Common Stock issued is determined based on the market price of the stock as of the closing of the acquisition. Acquisition costs are expensed when incurred. Cash and Cash Equivalents — Cash and cash equivalents includes cash, deposits with other financial institutions with original maturities under 90 days, and federal funds sold. Fair Value Measurements — Horizon uses fair value measurements to record fair value adjustments, to certain assets, and liabilities and to determine fair value disclosures. Horizon has adopted Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures for all applicable financial and nonfinancial assets and liabilities. This accounting guidance defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. This guidance applies only when other guidance requires or permits assets or liabilities to be measured at fair value; it does not expand the use of fair value in any new circumstances. 70 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) As defined in codification, fair value is the price to sell an asset or transfer a liability in an orderly transaction between market participants. It represents an exit price at the measurement date. Market participants are buyers and sellers, who are independent, knowledgeable, and willing and able to transact in the principal (or most advantageous) market for the asset or liability being measured. Current market conditions, including imbalances between supply and demand, are considered in determining fair value. Horizon values its assets and liabilities in the principal market where it sells the particular asset or transfers the liability with the greatest volume and level of activity. In the absence of a principal market, the valuation is based on the most advantageous market for the asset or liability (i.e., the market where the asset could be sold or the liability transferred at a price that maximizes the amount to be received for the asset or minimizes the amount to be paid to transfer the liability). In measuring the fair value of an asset, Horizon assumes the highest and best use of the asset by a market participant to maximize the value of the asset, and does not consider the intended use of the asset. When measuring the fair value of a liability, Horizon assumes that the nonperformance risk associated with the liability is the same before and after the transfer. Nonperformance risk is the risk that an obligation will not be satisfied and encompasses not only Horizon’s own credit risk (i.e., the risk that Horizon will fail to meet its obligation), but also other risks such as settlement risk. Horizon considers the effect of its own credit risk on the fair value for any period in which fair value is measured. There are three acceptable valuation techniques that can be used to measure fair value: the market approach, the income approach and the cost approach. Selection of the appropriate technique for valuing a particular asset or liability takes into consideration the exit market, the nature of the asset or liability being valued, and how a market participant would value the same asset or liability. Ultimately, determination of the appropriate valuation method requires significant judgment, and sufficient knowledge and expertise are required to apply the valuation techniques. Valuation inputs refer to the assumptions market participants would use in pricing a given asset or liability using one of the three valuation techniques. Inputs can be observable or unobservable. Observable inputs are those assumptions which market participants would use in pricing the particular asset or liability. These inputs are based on market data and are obtained from a source independent of Horizon. Unobservable inputs are assumptions based on Horizon’s own information or estimate of assumptions used by market participants in pricing the asset or liability. Unobservable inputs are based on the best and most current information available on the measurement date. All inputs, whether observable or unobservable, are ranked in accordance with a prescribed fair value hierarchy which gives the highest ranking to quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1) and the lowest ranking to unobservable inputs (Level 3). Fair values for assets or liabilities classified as Level 2 are based on one or a combination of the following factors: (i) quoted prices for similar assets; (ii) observable inputs for the asset or liability, such as interest rates or yield curves; or (iii) inputs derived principally from or corroborated by observable market data. The level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company considers an input to be significant if it drives 10 % or more of the total fair value of a particular asset or liability. Assets and liabilities are considered to be fair valued on a recurring basis if fair value is measured regularly (i.e., daily, weekly, monthly or quarterly). Recurring valuation occurs at a minimum on the measurement date. Assets and liabilities are considered to be fair valued on a nonrecurring basis if the fair value measurement of the instrument does not necessarily result in a change in the amount recorded on the balance sheet. Generally, nonrecurring valuation is the result of the application of other accounting pronouncements which require assets or liabilities to be assessed for impairment or recorded at the lower of cost or fair value. The fair value of assets or liabilities transferred in or out of Level 3 is measured on the transfer date, with any additional changes in fair value subsequent to the transfer considered to be realized or unrealized gains or losses. 71 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Investment Securities Available for Sale — Horizon designates a portion of its investment portfolio as available for sale based on management’s plans to use such securities for asset and liability management, liquidity and not to hold such securities as long-term investments. Management repositions the portfolio to take advantage of future expected interest rate trends when Horizon’s long-term profitability can be enhanced. Investment securities available for sale and marketable equity securities are carried at estimated fair value and any net unrealized gains/losses (after tax) on these securities are included in accumulated other comprehensive income. Amortization of premiums and accretion of discounts are recorded as interest income from securities. Gains/losses on the disposition of securities available for sale are recognized at the time of the transaction and are determined by the specific identification method. Investment Securities Held to Maturity — Includes any security for which Horizon has the positive intent and ability to hold until maturity. These securities are carried at amortized cost. Investment Securities Held for Trading — Horizon maintains a portfolio of securities classified as trading securities, which include debt and equity instruments that are purchased with the intent of selling them in the near term. Trading securities are recorded at fair value, and both realized and unrealized gains and losses are recognized in earnings. Loans — Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at amortized cost. Amortized cost is the principal balance outstanding, net of purchase premiums and discounts, deferred loan fees and costs. Accrued interest receivable totaling $ 23.7 million and $ 25.6 million at December 31, 2025 and 2024 was excluded from the Allowance for Credit Losses (“ACL”) calculation and was reported in accrued interest receivable on the consolidated balance sheet. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized in interest income using the effective yield method without anticipating prepayments. Interest on commercial, mortgage and installment loans is recognized over the term of the loans based on the principal amount outstanding. When principal or interest is past due 90 days or more, and the loan is not well secured or in the process of collection, or when serious doubt exists as to the collectability of a loan, the accrual of interest is discontinued. Loan origination fees, net of direct loan origination costs, are deferred and recognized over the life of the loan as a yield adjustment. Discounts and premiums on purchased loans are amortized to income using the interest method over the remaining period to contractual maturity, adjusted for anticipated prepayments. From time to time, the Bank obtains information that may lead management to believe that the collection of payments may be doubtful on a particular loan. In recognition of this, it is management's policy to convert the loan from an “earning asset” to a non–accruing loan. The entire balance of a loan is considered delinquent if the minimum payment contractually required to be made is not received by the specified due date. Further, it is management's policy to generally place a loan on non–accrual status when the payment is delinquent in excess of 90 days or the loan has had the accrual of interest discontinued by management. The officer responsible for the loan and the Chief Commercial Banking and/or the Chief Operations Officer must review all loans placed on non–accrual status. Subsequent payments on non–accrual loans are recorded as a reduction of principal, and interest income is recorded only after principal recovery is reasonably assured. Non–accrual loans are returned to accrual status when, in the opinion of management, the financial position of the borrower indicates there is no longer any reasonable doubt as to the timely collection of interest or principal in accordance with the loan terms. The Company requires a period of satisfactory performance of not less than six months before returning a non–accrual loan to accrual status. Expected credit losses are estimated over the contractual term of the loans, adjusted for expected prepayments when appropriate. The contractual term excludes expected extensions, renewals and modifications unless either of the following applies: management has a reasonable expectation at the reporting date that a modified loan will be executed with an individual borrower or the extension or renewal options are included in the original or modified contract at the reporting date and are not unconditionally cancellable by the Company. Consistent with regulatory guidance, charge–offs on all loan segments are taken when specific loans, or portions thereof, are considered uncollectible. The Company's policy is to promptly charge these loans off in the period the uncollectible loss is reasonably determined. 72 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) For all loan portfolio segments except 1–4 family residential properties and consumer, the Company promptly charges off loans, or portions thereof, when available information confirms that specific loans are uncollectible based on information that includes, but is not limited to, (1) the deteriorating financial condition of the borrower, (2) declining collateral values, and/or (3) legal action, including bankruptcy, that impairs the borrower's ability to adequately meet its obligations. For impaired loans that are considered to be solely collateral dependent, a partial charge–off is recorded when a loss has been confirmed by an updated appraisal or other appropriate valuation of the collateral. The Company charges off 1–4 family residential and consumer loans, or portions thereof, when the Company reasonably determines the amount of the loss. The Company adheres to timeframes established by applicable regulatory guidance which provides for the charge–down or specific allocation of family first and junior lien mortgages to the net realizable value less costs to sell when the value is known but no later than when a loan is 180 days past due. Pursuant to such guidelines, the Company also charges off unsecured open–end loans when the loan is contractually 90 days past due. Loans at these respective delinquency thresholds for which the Company can clearly document that the loan is both well–secured and in the process of collection, such that collection in full will occur regardless of delinquency status, are not charged off. A loan is individually evaluated when, based on current information, a creditor may be experiencing financial difficulty and repayment is substantially expected through operation or sale of collateral. For collateral–dependent assets individually evaluated, the Company utilizes, as a practical expedient, the fair value of collateral, adjusted for estimated costs to sell, when determining the allowance for credit losses. Smaller–balance, homogeneous loans are evaluated in total. Such loans include residential first mortgage loans secured by 1–4 family residences, residential construction loans, automobile, home equity, second mortgage loans and mortgage warehouse loans. Commercial loans and mortgage loans secured by other properties are evaluated individually. Modifications for Borrowers Experiencing Financial Difficulty — The Company may renegotiate the terms of existing loans for a variety of reasons. When refinancing or restructuring a loan, the Company evaluates whether the borrower is experiencing financial difficulty. In making this determination, the Company considers whether the borrower is currently in default on any of its debt. In addition, the Company evaluates whether it is probable that the borrower would be in payment default on any of its debt in the foreseeable future without the modification and if the borrower (without the current modification) could obtain equivalent financing from another creditor at a market rate for similar debt. Modifications of loans to borrowers in these situations may indicate that the borrower is facing financial difficulty Loan modifications to borrowers experiencing financial difficulty may be in the form of principal forgiveness, an interest rate reduction, an other-than-insignificant payment delay, or a term extension or a combination thereof, among other things. For disclosure purposes, an other-than-insignificant payment delay represents a deferral of payments of greater than 3 months within a 12 month period. Purchased Credit Deteriorated (“PCD”) Loans — The Company has purchased loans, some of which have experienced credit deterioration since origination. PCD loans are recorded at the amount paid. An ACL on loans is determined using the same methodology as other loans held for investment. The initial ACL on loans determined on a collective basis is allocated to individual loans. The sum of the loan’s purchase price and ACL on loans becomes its initial amortized cost basis. The difference between the initial amortized cost basis and the par value of the loan is a noncredit discount or premium, which is amortized or accreted into interest income over the remaining life of the loan. Subsequent changes to the ACL on loans are recorded through credit loss expense. Loans Held for Sale — Loans held for sale generally consist of mortgage loans originated and intended for sale in the secondary market and are carried at the lower of cost or fair value. Net unrealized losses, if any, are recognized through a valuation allowance by charges to non–interest income. Gains and losses on loan sales are recorded in non–interest income, and direct loan origination costs and fees are deferred at origination of the loan and are recognized in non–interest income upon sale of the loan. As of December 31, 2025, the Company elected to transfer loans at the Charlevoix Branch at the lower of unamortized cost or fair market value to loans held for sale from the held for investment loan portfolio. At 73 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) December 31, 2025, loans held for sale consisted of mortgage loans originated for sale with a carrying value of $ 2.4 million and the Charlevoix Branch loans with a carrying value of $ 7.4 million. Concentrations of Credit Risk — The Bank grants commercial, real estate, and consumer loans to customers located primarily in Indiana and Michigan. Commercial loans make up approximately 70 % of the loan portfolio and are secured by both real estate and business assets. These loans are expected to be repaid from cash flows from operations of the businesses. The Bank does not have a concentration in speculative commercial real estate loans. Residential real estate loans make up approximately 16 % of the loan portfolio and are secured by residential real estate. Installment loans make up approximately 14 % of the loan portfolio and are primarily secured by consumer assets . Allowance for Credit Losses (“ACL”) on Loans — The ACL on loans is a valuation account that is deducted from the loans’ amortized cost basis to present the net amount expected to be collected on the loans. Loans are charged off against the ACL when management believes the loan balance is confirmed to be no longer collectible. Expected recoveries do not exceed the aggregate of amounts previously charged off and expected to be charged off. Management estimates the ACL balance using relevant information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. Historical credit loss experience provides the basis for the estimation of expected credit losses. Adjustments to historical loss information are made for differences in current loan–specific risk characteristics such as differences in underwriting standards, portfolio mix, delinquency level, or term as well as for changes in environmental conditions, changes in economic conditions, or other relevant factors. The Company considers the following when estimating credit losses: 1) available information relevant to assessing the collectibility of cash flows including internal information, external information or a combination of both relating to past events, current conditions and reasonable and supportable forecasts; 2) relevant qualitative and quantitative factors relating to the environment in which the Company operates and factors specific to the borrower; 3) off–balance sheet credit exposures; and credit support. For periods beyond the reasonable and supportable forecast period, management applies a reversion method to estimate expected credit losses. The reversion method involves gradually reverting to historical loss experience over a specified period. Typically, the Company used a straight-line reversion method over a four-quarter period. Subsequent to the four quarter reversion period, the historical loss rate is applied to the remaining life of the loan. ACL on loans is measured on a collective basis and reflects impairment in groups of loans aggregated on the basis of similar risk characteristics which may include any one or a combination of the following: internal credit ratings, risk ratings or classification, financial asset type, collateral type, size, industry of the borrower, historical or expected credit loss patterns, and reasonable and supportable forecast periods. The ACL for a specific portfolio segment is computed by multiplying the loss rate by the amortized cost balance of the segment with adjustments for other qualitative factors as described above. As appropriate, newer credit products or portfolios with limited historical loss may use applicable external data for determining the ACL until experience justifies that sufficient product maturity supports the estimate of expected credit losses. Pursuant to ASC 326–20–30–9, an entity shall not rely solely on past events to estimate expected credit losses, and should consider adjustments to historical information to reflect the extent to which management expects current conditions and forecasted conditions to differ from the periods utilized for the historical loss rate calculation. Management has incorporated an adjustment of the historical loss rate calculated within the model to reflect current and forecasted condition and has applied this adjustment on a qualitative factor basis to the aggregate pool loss rate. The qualitative adjustment is based on a combination of external econometric data and internal factors such as portfolio composition, changes in management, changes in loan policy and other factors. The economic forecast is based in part on economic indexes and quantitative matrices with a twenty–four month forecast. The qualitative adjustment is calculated based on current and forecasted conditions and evaluated each quarter by management, and therefore is dynamic in nature. The qualitative economic adjustment is then reverted over a twelve month period to the historical base loss rate which is preserved in the calculation of “all in” loss rate. Specific reserves reflect collateral shortfalls on loans identified for evaluation or individually considered non–performing, including troubled debt restructurings and receivables where the Company has determined foreclosure 74 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) is probable. These loans no longer have similar risk characteristics to collectively evaluated loans due to changes in credit risk, borrower circumstances, recognition of write–offs, or cash collections that have been fully applied to principal on the basis of non–accrual policies. At a minimum, the population of loans subject to individual evaluation include individual loans and leases where it is probable we will be unable to collect all amounts due, according to the original contractual terms. These include commercial impaired loans, jumbo residential mortgages (as defined), and jumbo home equity loans with a balance exceeding $250,000, and other loans as determined by management. ACL for residential and consumer loans are, primarily, determined by pools of similar loans and are evaluated on a quarterly basis. Loans that do not share risk characteristics are evaluated on an individual basis. Loans evaluated individually are not also included in the collective evaluation. When management determines that foreclosure is probable, expected credit losses are based on the fair value of the collateral at the reporting date, adjusted for selling costs as appropriate. Allowance for Credit Losses on Off–Balance Sheet (“OBS”) Credit Exposures — The Company estimates expected credit losses over the contractual period in which the Company is exposed to credit risk via a contractual obligation to extend credit, unless that obligation is unconditionally cancellable by the Company. The Company determines the estimated amount of expected credit extensions based on historical usage to calculate the amount of exposure for a loss estimate. Allowance for Credit Losses on Available for Sale Securities — For available for sale debt securities in an unrealized loss position, the Company first assesses whether it intends to sell, or it is more likely than not that it will be required to sell, the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For debt securities available for sale that do not meet the aforementioned criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an ACL is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis. Any impairment that has not been recorded through an ACL is recorded in other comprehensive income. Changes in the ACL are recorded as provision for, or reversal of, credit loss expense. Losses are charged against the allowance when management believes the available for sale security is confirmed to be uncollectible or when either of the criteria regarding intent or requirement to sell is met. Allowance for Credit Losses on Held to Maturity Securities — For held to maturity securities, the Company conducts an assessment of its held to maturity securities at the time of purchase and on at least an annual basis to ensure such investment securities remain within appropriate levels of risk and continue to perform satisfactorily in fulfilling its obligations. The Company considers, among other factors, the nature of the securities and credit ratings or financial condition of the issuer. If available, the Company obtains a credit rating for issuers from the Nationally Recognized Statistical Rating Organization (“NRSRO”) for consideration. If this assessment indicates that a material credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an ACL is recorded for the credit loss. Premises and Equipment — Land is carried at cost. Premises and equipment are stated at cost, net of accumulated depreciation and amortization. Buildings and major improvements are capitalized and depreciated using primarily the straight-line method with useful lives ranging from 3 to 40 years. Furniture and equipment are capitalized and depreciated using primarily the straight-line method with useful lives ranging from 2 to 20 years. Maintenance and repairs are expensed as incurred while major additions and improvements are capitalized. Gains and losses on disposition are included in current operations. Repossessed Assets - Repossessed assets consist of property that has been repossessed and is comprised of commercial and residential real estate and other non-real estate property, including auto and recreational and 75 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) marine vehicles. The assets are initially recorded at fair value less estimated selling costs, establishing a new cost basis. Initial valuation adjustments are charged to the allowance for credit losses. Fair values are estimated primarily based on appraisals, third-party price opinions, or internally developed pricing models. After initial recognition, fair value estimates are updated periodically. Declines in fair value below cost are recognized through valuation allowances which may be reversed when supported by future increases in fair value. These valuation adjustments, in addition to gains and losses realized on sales and net operating expenses, are recorded in other non-interest expense. Repossessed assets are included in other assets on the consolidated balance sheet. Federal Reserve and Federal Home Loan Bank of Indianapolis (FHLBI) Stock — The stock is a required investment for institutions that are members of the Federal Reserve Bank (“FRB”) and Federal Home Loan Bank (“FHLB”) systems. The required investment in the common stock is based on a predetermined formula. Partnership Investments — The Company invests in partnerships that generate qualified affordable housing and solar tax credits. The Company has elected to account for partnership investments in qualified affordable housing using the proportional amortization method. Under the proportional amortization method, the initial cost of the investment is amortized to income tax expense in proportion to the tax credits and other tax benefits received. This net investment performance is recognized in the income statement as a component of income tax expense. The Company accounts for qualifying investment tax credits using the proportional amortization method and all others under the deferral method. The investment in the limited partnerships totaling $ 16.6 million and $ 24.9 million at December 31, 2025 and 2024, respectively is included in other assets in the consolidated balance sheets. The Company investments in qualified affordable housing tax credits and had funding commitments of $ 0.3 million at December 31, 2025. There has not been any significant amortization or tax credits recorded related to the qualified affordable housing tax credits at December 31, 2025. Mortgage Servicing Rights — Mortgage servicing assets are recognized separately when rights are acquired through purchase or through sale of financial assets and included in other assets on the balance sheet. Under the servicing assets and liabilities accounting guidance (ASC 860-50), servicing rights resulting from the sale or securitization of loans originated by the Company are initially measured at fair value at the date of transfer. Under the amortization method, servicing rights are amortized in proportion to and over the period of estimated net servicing income. The amortized assets are assessed for impairment or increased obligation based on fair value at each reporting date. Fair value is based on market prices for comparable mortgage servicing contracts, when available, or alternatively, is based on a valuation model that calculates the present value of estimated future net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income, such as the cost to service, the discount rate, the custodial earnings rate, an inflation rate, ancillary income, prepayment speeds and default rates and losses. These variables change from quarter to quarter as market conditions and projected interest rates change, and may have an adverse impact on the value of the mortgage servicing right and may result in a reduction to non–interest income. Each class of separately recognized servicing assets subsequently measured using the amortization method are evaluated and measured for impairment. Impairment is determined by stratifying rights into tranches based on predominant characteristics, such as loan term and rate type. Impairment is recognized through a valuation allowance for an individual tranche, to the extent that fair value is less than the carrying amount of the servicing assets for that tranche. The valuation allowance is adjusted to reflect changes in the measurement of impairment after the initial measurement of impairment. Changes in valuation allowances are reported with mortgage servicing income net of impairment on the income statement. Fair value in excess of the carrying amount of servicing assets for that stratum is not recognized. Servicing fee income, which is reported on the income statement as mortgage servicing income, net , is recorded for fees earned for servicing loans. The fees are based on a contractual percentage of the outstanding principal or a fixed amount per loan and are recorded as income when earned. The amortization of mortgage servicing rights is netted against loan servicing fee income. Servicing fees t otaled $ 1.5 million, $ 1.7 million and $ 2.7 million for the years ended December 31, 2025, 2024, and 2023, respectively. Late fees and ancillary fees related to loan servicing were not material. 76 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Goodwill and Intangible Assets — Goodwill is tested annually for impairment or more frequently should potential triggering events be identified that may indicate potential impairment. At December 31, 2025, Horizon had core deposit intangibles of $ 7.2 million subject to amortization and $ 155.2 million of goodwill, which is not subject to amortization. Goodwill arising from business combinations represents the value attributable to unidentifiable intangible assets in the business acquired. Horizon’s goodwill relates to the value inherent in the banking industry and that value is dependent upon the ability of Horizon to provide quality, cost effective banking services in a competitive marketplace. The goodwill value is supported by revenue that is in part driven by the volume of business transacted. If the implied fair value of goodwill is lower than its carrying amount, goodwill impairment is indicated and goodwill is written down to its implied fair value. A large majority of the goodwill relates to the acquisitions of Heartland, Summit, Peoples, Kosciusko, LaPorte, Lafayette, Wolverine and Salin. Advertising Costs — Advertising costs are expensed as incurred and included in non-interest expenses in the Consolidated Statement of Income . For the year ended December 31, 2025, 2024, and 2023, t he Company incurred advertising costs of $ 0.7 million , $ 1.2 million, and $ 1.2 million , respectively. Bank Owned Life Insurance (“BOLI”) – BOLI has been purchased on certain employees and directors of the Company. The Company records the life insurance at the amount that can be realized under the insurance contract at the balance sheet date, which is the cash surrender value adjusted for other charges or amounts due that are probable at settlement. Securities Purchased Under Agreements to Resell, Securities Sold Under Agreements to Repurchase and Other Secured Borrowings — The Company purchases certain securities, generally U.S. government–sponsored entity and agency securities, under agreements to resell. The amounts advanced under these agreements represent short–term secured loans and are reflected as assets in the accompanying consolidated balance sheets. We also sell certain securities under agreements to repurchase. These agreements are treated as collateralized financing transactions. These and other secured borrowings such as loans sold not qualifying for sale accounting treatment, are reflected as liabilities in the accompanying consolidated balance sheets and are recorded at the amount of cash received in connection with the transaction. Short–term securities sold under agreements to repurchase generally mature within one to four days from the transaction date. Securities, generally U.S. government agency securities, pledged as collateral under these financing arrangements can be re–pledged by the secured party. Additional collateral may be required based on the fair value of the underlying securities. Income Taxes — The Company accounts for income taxes in accordance with income tax accounting guidance (ASC 740, Income Taxes ). The income tax accounting guidance results in two components of income tax expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. The Company determines deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax bases of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur. Deferred income tax expense results from changes in deferred tax assets and liabilities between periods. Deferred tax assets are reduced by a valuation allowance if, based on the weight of evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized. Uncertain tax positions are recognized if it is more likely than not, based on the technical merits, that the tax position will be realized or sustained upon examination. The term more likely than not means a likelihood of more than 50 percent; the terms examined and upon examination also include resolution of the related appeals or litigation processes, if any. A tax position that meets the more-likely-than-not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50 percent likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The determination of whether or not a tax position has met the more-likely-than-not recognition threshold considers the facts, circumstances and information available at the reporting date and is subject to management’s judgment. The Company recognizes interest and penalties on income taxes as a component of income tax expense. The Company files consolidated income tax returns with its subsidiaries. 77 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Trust Assets and Income — Property, other than cash deposits, held in a fiduciary or agency capacity is not included in the consolidated balance sheets since such property is not owned by Horizon. Transfer of Financial Assets — The transfer of financial assets are accounted for as sales, when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company and put presumptively beyond the reach of the transferor and its creditors, even in bankruptcy or other receivership, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity or the ability to unilaterally cause the holder to return specific assets. Earnings per Common Share — Basic earnings per share is computed by dividing net income available to common shareholders (net income less dividend requirements for preferred stock and accretion of preferred stock discount) by the weighted–average number of common shares outstanding. Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. The following table shows computation of basic and diluted earnings per share. Years Ended December 31 (dollar amounts in thousands, except per share) 2025 2024 2023 Basic earnings per share Net income (loss) $ ( 150,482 ) $ 35,429 $ 27,981 Weighted average common shares outstanding 46,486,776 43,702,314 43,630,160 Basic earnings per share $ ( 3.24 ) $ 0.81 $ 0.64 Diluted earnings per share Net income (loss) available to common shareholders $ ( 150,482 ) $ 35,429 $ 27,981 Weighted average common shares outstanding 46,486,776 43,702,314 43,630,160 Effect of dilutive securities: Restricted stock — 359,704 208,827 Stock options — 2,472 4,893 Weighted average common shares outstanding 46,486,776 44,064,490 43,843,880 Diluted Earnings per Share $ ( 3.24 ) $ 0.80 $ 0.64 Due to the net loss for the year ended December 31, 2025, all potential common shares are non-dilutive and are therefore excluded from diluted earnings per share. There were 85,212 and 226,028 shares for the years ended December 31, 2024 and December 31, 2023, respectively, which were not included in the computation of diluted earnings per share because they were non-dilutive. On July 16, 20 19, the Board of Directors of the Company authorized a stock repurchase program for up to 2,250,000 shares of Horizon’s issued and outstanding common stock, no par value. As of December 31, 2025, Horizon had repurchased a total of 803,349 shares at an average price per share of $ 16.89 . Consolidated Statements of Cash Flows — For purposes of reporting cash flows, cash and cash equivalents are defined to include cash and due from banks, money market investments and federal funds sold with maturities of one day or less. Horizon reports net cash flows for customer loan transactions, deposit transactions, short–term investments and short-term borrowings. Comprehensive Income (Loss) — Comprehensive income (loss) consists of net income and other comprehensive income (loss), net of applicable income taxes. Other comprehensive income (loss) includes unrealized gain (loss) on available for sale securities, unrealized and realized gains and losses in cash flow derivative financial instruments and accretion (amortization) of available for sale securities transferred to held to maturity. 78 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Share–Based Compensation — At December 31, 2025, Horizon had share–based compensation plans, which are described more fully in Note 20. All share–based payments are to be recognized as expense, based upon their fair values, in the financial statements over the vesting period of the awards. Horizon has recorded approximately $1.6 million, $ 4.6 million, and $ 3.6 million in compensation expense relating to vesting of stock options and restricted stock awards less estimated forfeitures for the year ended December 31, 2025, 2024 and 2023, respectively. The Company recognizes forfeitures as a reduction to expense only when they have occurred. Derivative Financial Instruments — The Company occasionally enters into derivative financial instruments as part of its interest rate risk management strategies. These derivative financial instruments consist primarily of interest rate swaps. All derivative instruments are recorded on the Consolidated Balance Sheets, as either an asset or liability, at their fair value. The accounting for the gain or loss resulting from the change in fair value depends on the intended use of the derivative. For a derivative used to hedge changes in fair value of a recognized asset or liability, or an unrecognized firm commitment, the gain or loss on the derivative will be recognized in earnings together with the offsetting loss or gain on the hedged item. This results in an earnings impact only to the extent that the hedge is ineffective in achieving offsetting changes in fair value. If it is determined that the derivative instrument is not highly effective as a hedge, hedge accounting is discontinued and the adjustment to fair value of the derivative instrument is recorded in earnings. For a derivative used to hedge changes in cash flows associated with forecasted transactions, the gain or loss of the effective portion of the derivative will be deferred, and reported as accumulated other comprehensive income, a component of stockholders’ equity, until such time the hedged transaction affects earnings. For derivative instruments not accounted for as hedges, changes in fair value are recognized in non–interest income or non–interest expense. See Note 21 - Derivative Financial Instruments. Revenue Recognition — Accounting Standards Codification 606, “Revenue from Contracts with Customers” (ASC 606) provides that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance enumerates five steps that entities should follow in achieving this core principle. Revenue generated from financial instruments, including loans and investment securities, are not included in the scope of ASC 606. The adoption of ASC 606 did not result in a change to the accounting of any of the Company’s revenue streams that are within the scope of the amendments. Revenue–gathering activities that are within the scope of ASC 606 and that are presented as non-interest income in the Company’s consolidated statements of income include: • Service charges and fees on deposit accounts – these include general service fees charged for deposit account maintenance and activity and transaction-based fees charged for certain services, such as debit card, wire transfer and overdraft activities. Revenue is recognized when the performance obligation is completed, which is generally after a transaction is completed or monthly for account maintenance services. • Fiduciary activities – this includes periodic fees due from trust and wealth management customers for managing the customers’ financial assets. Fees are charged based on a standard agreement and are recognized as they are earned. Segments — The Company has identified one reporting unit and one operating segment, community banking, which encompasses commercial and consumer banking services to serve a similar base of clients utilizing company-wide offerings of similar products and services managed through similar processes and platforms offered to individuals, businesses, municipalities and other entities. See Note 26 - Segment Reporting for more details. 79 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Adoption of New Accounting Standards ASU No. 2023-09 "Income Taxes (Topic 740): Improvements to Income Tax Disclosures" ("ASU 2023-09") requires additional annual disclosures including further disaggregation of information in the rate reconciliation, additional information for reconciling items meeting a quantitative threshold, further disaggregation of income taxes paid and other required disclosures. ASU 2023-09 became effective in 2025 (see Note 16 - Income Taxes) Accounting Guidance Issued But Not Yet Adopted ASU 2024-03 "Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses" ("ASU 2024-03") requires disaggregated disclosure of income statement expenses for public business entities. ASU 2024-03 requires new financial statement disclosures in tabular format, disaggregating information about prescribed categories underlying any relevant income statement expense caption. The prescribed categories include, among other things, employee compensation, depreciation, and intangible asset amortization. Additionally, entities must disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. ASU 2024-03 is effective for the Company, on a prospective basis, for annual periods beginning in 2027, and interim periods within fiscal years beginning in 2028, though early adoption and retrospective application is permitted. ASU 2024-03 is not expected to have a significant impact on our financial statements. ASU 2025-09, “Derivatives and Hedging (Topic 815): Hedge Accounting Improvements.” (“ASU-2025-09”) This ASU is effective for annual periods beginning after December 15, 2026. The amendments are intended to better align hedge accounting with the economics of entities’ risk‑management activities and to address implementation issues that emerged following ASU 2017‑12 and the transition away from LIBOR. The Company expects adoption will primarily affect documentation and processes and does not expect a material impact on the consolidated financial statements. ASU No. 2025-06, "Intangibles—Goodwill and Other—Internal-Use Software" (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, seeking to update the guidance on accounting for software. This ASU addresses stakeholder and investor concerns on the challenges of applying current internal-use software accounting requirements that do not specifically address software developed using modern incremental and iterative methods, which has led to diversity in practice in determining when to begin capitalizing software costs. The ASU removes all references to a prescriptive and sequential software development method. The amendments require an entity to start capitalizing software costs when management has authorized and committed to funding the software project, and it is probable that the project will be completed and the software will be used to perform the function intended. The amendments in the ASU are effective for annual reporting periods beginning after December 15, 2027, and for interim reporting periods beginning after December 15, 2027. The Company does not anticipate this ASU will have a material impact on its financial statements. ASU 2025‑08, "Financial Instruments - Credit Losses (Topic 326): Purchased Loans.” ASU 2025-08 expands the scope of the “gross‑up” method, formerly applicable only to purchased credit‑deteriorated ("PCD") assets, to include acquired non‑PCD loans that meet certain criteria, now referred to as “purchased seasoned loans” (PSLs). Under this model, an allowance for expected credit losses is recognized at acquisition, offsetting the loan’s amortized cost basis, thereby eliminating the day-one credit‑loss expense previously required for non‑PCD assets. PSLs are defined as non‑PCD loans acquired either (i) through a business combination, or (ii) purchased more than 90 days after origination when the acquirer was not involved in origination. ASU 2025-08 will be effective for us, on a prospective basis for loans acquired on or after the adoption date, for interim and annual reporting periods beginning in 2027, though early adoption is permitted. ASU 2025-08 is not expected to have a significant impact on our financial statements. Note 2 – Cash Equivalents The Company considers cash on hand, amounts due from banks, interest-bearing deposits in other financial institutions, and other highly liquid investments with original maturities of three months or less to be cash and cash equivalents. At December 31, 2025 and 2024, cash equivalents consisted primarily of deposits with other financial institutions and balances maintained at the Federal Reserve. 80 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The Federal Reserve Act requires that the banks maintain cash reserve balances with the Federal Reserve Bank based principally on the type and amount of their deposits. At its option, the Company maintains additional balances to compensate for clearing and safekeeping services. At December 31, 2025, the Company’s cash accounts exceeded federally insured limits by approximately $ 101.5 million. Approximately $ 71.6 million of this amount was held by either the Federal Reserve Bank or the Federal Home Loan Bank of Indianapolis, which is not federally insured. Note 3 – Securities The fair value of securities is as follows: December 31, 2025 Amortized Cost Allowance for Credit Losses Net Carrying Amount Gross Unrealized Gains Gross Unrealized Losses Fair Value Available for sale U.S. Treasury, federal agencies, and government sponsored agencies $ 16,837 $ — 16,837 70 $ ( 2 ) $ 16,905 State and municipal 353,559 — 353,559 2,109 ( 36,003 ) 319,665 U.S. government agency mortgage-backed securities 489,683 — 489,683 4,725 ( 234 ) 494,174 Corporate notes 48,750 ( 120 ) 48,630 — ( 3,960 ) 44,670 Total available for sale investment securities $ 908,829 $ ( 120 ) $ 908,709 $ 6,904 $ ( 40,199 ) $ 875,414 December 31, 2025 Amortized Cost Allowance for Credit Losses Net Carrying Amount Gross Unrealized Gains Gross Unrealized Losses Fair Value Held to maturity U.S. Treasury, federal agencies, and government sponsored agencies $ — $ — $ — $ — $ — $ — State and municipal — — — — — — U.S. government agency mortgage-backed securities — — — — — — Private labeled mortgage–backed pools — — — — — — Corporate notes — — — — — — Total held to maturity investment securities $ — $ — $ — $ — $ — $ — In August 2025, the Company reclassified its held-to-maturity investment portfolio, with a carrying value of $ 1.8 billion and unrealized loss of $ 282.6 million, to the available-for-sale portfolio as part of the Company's balance 81 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) sheet repositioning. Following the reclassification, the Company sold securities with a fair value of $ 1.4 billion, recognizing a pre-tax loss of $ 299.5 million upon sale. The fair value of trading securities is as follows: December 31, 2025 December 31, 2024 Held for Trading U.S. Treasury, federal agencies, and government sponsored agencies $ 3,883 $ — State and municipal — — U.S. government agency mortgage-backed securities — — Corporate notes — — Total trading securities $ 3,883 0 $ — For the year-ended December 31, 2025, the net gains (losses) on trading securities were determined to be immaterial to the consolidated financial statements. December 31, 2024 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available for sale U.S. Treasury, federal agencies, and government sponsored agencies $ 2,258 $ — $ ( 457 ) $ 1,801 State and municipal 243,521 — ( 41,687 ) 201,834 U.S. government agency mortgage-backed securities 17,984 — ( 3,441 ) 14,543 Corporate notes 18,259 — ( 2,760 ) 15,499 Total available for sale investment securities $ 282,022 $ — $ ( 48,345 ) $ 233,677 December 31, 2024 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Held to maturity U.S. Treasury, federal agencies, and government sponsored agencies $ 278,383 $ — $ ( 39,253 ) $ 239,130 State and municipal 1,048,862 958 ( 183,114 ) 866,706 U.S. government agency mortgage-backed securities 349,726 — ( 54,904 ) 294,822 Private labeled mortgage–backed pools 29,278 — ( 3,958 ) 25,320 Corporate notes 161,599 — ( 21,309 ) 140,290 Total held to maturity investment securities $ 1,867,848 $ 958 $ ( 302,538 ) $ 1,566,268 Less: Allowance for credit losses ( 158 ) Held to maturity securities, net of allowance for credit losses $ 1,867,690 The amortized cost and fair value of securities available for sale at December 31, 2025 by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. 82 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) December 31, 2025 Amortized Cost Fair Value Available for sale Within one year $ 15,836 $ 15,773 One to five years 47,706 46,646 Five to ten years 75,422 69,653 After ten years 280,182 249,168 419,146 381,240 U.S. government agency mortgage-backed securities 489,683 494,174 Total available for sale investment securities $ 908,829 $ 875,414 The following tables show the gross unrealized losses and the fair value of the Company’s available for sale investments in which an allowance for credit losses were not recorded, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position. December 31, 2025 Less than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Available for Sale Investment Securities U.S. Treasury, federal agencies, and government sponsored agencies $ — $ — $ 748 $ ( 2 ) $ 748 $ ( 2 ) State and municipal 26,804 ( 725 ) 200,978 ( 35,278 ) 227,782 ( 36,003 ) U.S. government agency mortgage-backed securities 40,547 ( 221 ) 200 ( 13 ) 40,747 ( 234 ) Corporate notes — — 40,799 ( 2,951 ) 40,799 ( 2,951 ) Total available for sale investment securities $ 67,351 $ ( 946 ) $ 242,725 $ ( 38,244 ) $ 310,076 $ ( 39,190 ) December 31, 2024 Less than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Available for Sale Investment Securities U.S. Treasury, federal agencies, and government sponsored agencies $ — $ — $ 1,801 $ ( 457 ) $ 1,801 $ ( 457 ) State and municipal — — 201,834 ( 41,687 ) 201,834 ( 41,687 ) U.S. government agency mortgage-backed securities — — 14,543 ( 3,441 ) 14,543 ( 3,441 ) Corporate notes — — 15,499 ( 2,760 ) 15,499 ( 2,760 ) Total available for sale investment securities $ — $ — $ 233,677 $ ( 48,345 ) $ 233,677 $ ( 48,345 ) Certain investments in debt securities are reported in the consolidated financial statements at an amount less than their historical cost. As of December 31, 2025 and 2024, the Company had 836 and 2,115 securities, respectively, with market values below their cost basis. The total fair value of these investments at December 31, 2025 and 2024 was $ 310.1 million and $ 1.8 billion, which is approximately 35 % and 86 %, respectively, of the Company's available for sale and held to maturity securities portfolio. These declines resulted primarily from fluctuations in market interest rates after purchase. Management believes the declines in fair value for these securities are temporary. 83 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The Company determines credit losses on available-for-sale investment securities by a discounted cash flow approach using the security’s prepayment-adjusted effective interest rate. The allowance for credit losses is measured as the amount by which an investment security’s amortized cost exceeds the net present value of expected future cash flows. However, the amount of credit losses for available-for-sale investment securities is limited to the amount of a security’s unrealized loss. The following table details activity in the allowance for credit losses on available for sale debt securities during the year-ended December 31, 2025 and 2024. December 31, December 31, 2025 2024 Beginning balance $ — $ — Allowance for credit losses expense (benefit) - AFS Securities 120 — Ending balance $ 120 $ — Due to a specific issuer's deferral of principal and interest payments, the Company placed a corporate debt security with a fair value of $ 4.0 million on non-accrual status and recorded a $ 120 thousand allowance for credit losses. Based on an evaluation of available evidence, management believes the unrealized losses on available for sale state and municipal securities and corporate notes, excluding certain securities disclosed above, were due to changes in interest rates. Due to the contractual terms, the issuers of state and municipal securities are not allowed to settle for less than the amortized cost of the security. The allowance for credit losses for held to maturity securities is a contra asset valuation account that is deducted from the carrying amount of held to maturity securities to present the net amount expected to be collected. Held to maturity securities are charged off against the allowance for credit loss when deemed uncollectible. Adjustments to the allowance for credit loss are reported in our Consolidated Statements of Income in credit loss expense. We measure expected credit losses on held to maturity securities on a collective basis by major security type with each type sharing similar risk characteristics, and considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. With regard to U.S. Government–sponsored treasuries, agency and mortgage–backed securities, all these securities are issued by a U.S. government–sponsored entity and have an implicit or explicit government guarantee; therefore, no allowance for credit losses has been recorded for these securities. With regard to obligations of states and municipal, private label mortgage–backed and corporate note held to maturity securities, we consider (1) issuer bond ratings, (2) historical loss rates for given bond ratings, (3) the financial condition of the issuer, and (4) whether issuers continue to make timely principal and interest payments under the contractual terms of the securities. Historical loss rates associated with securities having similar grades as those in our portfolio have been insignificant. As of December 31, 2024, there were no past due principal and interest payments associated with these securities. An allowance for credit loss of $ 0 and $ 158 thousand was recorded on these securities based on applying the long–term historical rating agency credit loss rate for similarly rated securities at December 31, 2025 and December 31, 2024. On a quarterly basis, the Company refreshes the credit quality indicator of each held-to-maturity security. The Company applies ratings derived from Nationally Recognized Statistical Rating Organizations ("NRSRO"), specifically Moody's and Standard & Poor's. For state and municipal securities where no rating is available from the NRSROs, a consistent internally-assigned rating methodology is applied. The amortized cost of these securities in the following tables subject to this methodology totaled $ 0 as of December 31, 2025, and $ 125 million as of December 31, 2024. 84 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following table summarizes credit ratings of our held-to-maturity securities at amortized cost for the periods indicated: December 31, 2025 AAA AA A BBB BB Not Rated Total U.S. Treasury, federal agencies, and government sponsored agencies — — — — — — — State and municipal — — — — — — — U.S. government agency mortgage-backed securities — — — — — — — Private labeled mortgage-backed pools — — — — — — — Corporate notes — — — — — — — Total — — — — — — — December 31, 2024 AAA AA A BBB BB Not Rated Total U.S. Treasury, federal agencies, and government sponsored agencies — 278,383 — — — — 278,383 State and municipal 273,629 698,428 66,079 10,726 — — 1,048,862 U.S. government agency mortgage-backed securities 349,726 — — — — — 349,726 Private labeled mortgage-backed pools 29,278 — — — — — 29,278 Corporate notes — 6,176 11,549 75,603 4,543 63,728 161,599 Total 652,633 982,987 77,628 86,329 4,543 63,728 1,867,848 The following table details activity in the allowance for credit losses on held-to-maturity securities for the year ended December 31, 2025 and 2024. December 31, 2025 December 31, 2024 Beginning balance $ 158 $ 157 Credit loss expense (benefit) ( 158 ) 1 Ending balance $ — $ 158 Accrued interest receivable on available for sale debt securities and held to maturity securities totaled $ 5.3 million and $ 12.7 million at December 31, 2025 and December 31, 2024, respectively, and is excluded from the estimate of credit losses. The U.S. government sponsored entities and agencies and mortgage–backed securities are either explicitly or implicitly guaranteed by the U.S. government, are highly rated by major credit rating agencies, and have a long history of no credit losses. Therefore, for those securities, we do not record expected credit losses. The Company does not intend to sell these securities prior to the recovery of the amortized cost, which may not occur until maturity. An allowance for credit losses of $ 120 thousand and zero was recognized for available for sale debt securities at December 31, 2025 and December 31, 2024, respectively. 85 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Information regarding security proceeds, gross gains and gross losses are presented below. Year Ended December 31 2025 2024 2023 Sales of securities available for sale Proceeds $ 1,409,870 $ 293,138 $ 439,285 Gross gains — 6 215 Gross losses ( 299,538 ) ( 39,145 ) ( 32,267 ) The tax benefit of the proceeds from the sale of securities available for sale was $ 62.9 million, $ 8.2 million and $ 6.7 million for the years ended December 31, 2025, 2024 and 2023, respectively. The Company pledges securities related to borrowings capacity at the Federal Reserve and Federal Home Loan Bank. The following table represents the fair value and amortized costs of these pledged securities. December 31, 2025 December 31, 2024 Fair Value Amortized Cost Fair Value Amortized Cost Pledged securities for borrowing availability at the Federal Reserve $ 114,727 $ 140,512 $ 851,384 $ 1,032,916 Pledge securities for FHLB borrowings $ — $ — $ 279,136 $ 333,613 Pledged securities for derivative instruments $ — $ — $ 6,234 $ 6,709 86 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Note 4 – Loans The table below identifies the Company's loan portfolio segments and classes. Portfolio Segment Class of Financing Receivable Commercial Owner occupied real estate Non-owner occupied real estate Residential spec homes Development & spec land Commercial and industrial Residential real estate Residential mortgage Residential construction Consumer Direct installment Indirect installment Home equity Portfolio segment is defined as a level at which an entity develops and documents a systematic methodology to determine its allowance for credit losses. Class of financing receivable is defined as a group of financing receivables determined on the basis of both of the following, 1) risk characteristics of the financing receivable, and 2) an entity’s method for monitoring and assessing credit risk. Generally, the Bank does not move loans from a revolving loan to a term loan other than construction loans. Construction loans are reviewed and rewritten prior to being originated as a term loan. The following table presents total outstanding loans held of investment by portfolio class, as of December 31, 2025 and 2024. December 31, 2025 December 31, 2024 Commercial Owner occupied real estate $ 699,327 $ 667,165 Non–owner occupied real estate 1,669,260 1,501,456 Residential spec homes 17,741 15,611 Development & spec land 35,535 18,627 Commercial and industrial 1,010,545 875,297 Total commercial 3,432,408 3,078,156 Real estate Residential mortgage 741,477 783,961 Residential construction 30,950 18,948 Total real estate 772,427 802,909 Consumer Direct installment 77,174 97,190 Indirect installment 19,672 303,901 Home equity 574,861 564,884 Total consumer 671,707 965,975 Total loans 4,876,542 4,847,040 Allowance for credit losses ( 51,299 ) ( 51,980 ) Net loans $ 4,825,243 $ 4,795,060 Total loans include net unearned discounts and deferred loan costs of $ 6.8 million and $ 14.9 million at December 31, 2025 and 2024, respectively. 87 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The risk characteristics of each loan portfolio segment are as follows: Commercial Commercial loans are primarily based on the identified cash flows of the borrower and secondarily on the underlying collateral provided by the borrower. The cash flows of borrowers, however, may not be as expected, and the collateral securing these loans may fluctuate in value. Most commercial loans are secured by the assets being financed or other business assets such as accounts receivable or inventory and may incorporate a personal guarantee; however, some short-term loans may be made on an unsecured basis. In the case of loans secured by accounts receivable, the availability of funds for the repayment of these loans may be substantially dependent on the ability of the borrower to collect amounts due from its customers. Commercial real estate loans are viewed primarily as cash flow loans and secondarily as loans secured by real estate. Commercial real estate lending typically involves larger loan principal amounts and the repayment of these loans is generally dependent on the successful operation of the property securing the loan or the business conducted on the property securing the loan. Commercial real estate loans may be more adversely affected by conditions in the real estate markets, the general economy or fluctuations in interest rates. The properties securing the Company’s commercial real estate portfolio are diverse in terms of property type, and are monitored for concentrations of credit. Management monitors and evaluates commercial real estate loans based on collateral, cash flow and risk grade criteria. As a general rule, the Company avoids financing single purpose projects unless other underwriting factors are present to help mitigate risk. In addition, management tracks the level of owner occupied commercial real estate loans versus non-owner occupied loans. Real Estate and Consumer With respect to residential loans that are secured by 1-4 family residences and are generally owner occupied, the Company generally establishes a maximum loan-to-value ratio and requires private mortgage insurance if that ratio is exceeded. Home equity loans are typically secured by a subordinate interest in 1-4 family residences, and consumer loans are secured by consumer assets such as automobiles or recreational vehicles. Some consumer loans are unsecured such as small installment loans and certain lines of credit. Repayment of these loans is primarily dependent on the personal income of the borrowers, which can be impacted by economic conditions in their market areas such as unemployment levels. Repayment can also be impacted by changes in property values on residential properties. Risk is mitigated by the fact that the loans are of smaller individual amounts and spread over a large number of borrowers. 88 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Non–performing Loans The following table presents non–accrual loans and loans past due over 90 days still on accrual by class of loans at December 31, 2025: December 31, 2025 Total Non-accrual Loans Past Due Over 90 Days Still Accruing Non-accruing Loans with no Allowance for Credit Losses Commercial Owner occupied real estate $ 5,396 $ — $ 1,599 Non–owner occupied real estate 3,026 — 1,074 Residential spec homes — — — Development & spec land 496 — 496 Commercial and industrial 5,631 — 3,951 Total commercial 14,549 — 7,120 Real estate Residential mortgage 10,087 90 929 Residential construction — — — Total real estate 10,087 90 929 Consumer Direct installment 342 373 — Indirect installment 1,058 170 — Home equity 6,421 1,856 — Total consumer 7,821 2,399 — Total $ 32,457 $ 2,489 $ 8,049 89 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following table presents non–accrual loans, loans past due over 90 days still on accrual by class of loan at December 31, 2024: December 31, 2024 Total Non-accrual Loans Past Due Over 90 Days Still Accruing Non-accruing Loans with no Allowance for Credit Losses Commercial Owner occupied real estate $ 2,448 $ — $ 1,419 Non–owner occupied real estate 444 — 444 Residential spec homes — — — Development & spec land 534 — 534 Commercial and industrial 2,232 — 1,239 Total commercial 5,658 — 3,636 Real estate Residential mortgage 11,215 — — Residential construction — — — Total real estate 11,215 — — Consumer Direct installment 338 128 — Indirect installment 1,542 358 — Home equity 7,039 680 — Total consumer 8,919 1,166 — Total $ 25,792 $ 1,166 $ 3,636 There was no interest income recognized on non–accrual loans during the years ended December 31, 2025 or 2024 while the loans were in non–accrual status. The amount of accrued interest receivable written off by the Company by reversing interest income was $ 0.7 million for the year ended December 31, 2025. The amount was immaterial for disclosure for the year ended December 31, 2024. 90 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following table presents the payment status by class of loan at December 31, 2025: December 31, 2025 Current 30-59 Days Past Due 60-89 Days Past Due 90 Days or Greater Past Due Total Past Due Total Loans Commercial Owner occupied real estate $ 694,040 $ 2,671 $ 384 $ 2,232 $ 5,287 $ 699,327 Non–owner occupied real estate 1,668,372 490 398 — 888 1,669,260 Residential spec homes 17,741 — — — — 17,741 Development & spec land 35,039 — 496 — 496 35,535 Commercial and industrial 1,002,074 4,606 1,310 2,555 8,471 1,010,545 Total commercial 3,417,266 7,767 2,588 4,787 15,142 3,432,408 Real estate Residential mortgage 730,784 4 3,221 7,468 10,693 741,477 Residential construction 28,916 — 2,034 — 2,034 30,950 Total real estate 759,700 4 5,255 7,468 12,727 772,427 Consumer Direct installment 73,671 2,638 343 522 3,503 77,174 Indirect installment 16,390 2,203 478 601 3,282 19,672 Home equity 560,895 5,991 2,321 5,654 13,966 574,861 Total consumer 650,956 10,832 3,142 6,777 20,751 671,707 Total $ 4,827,922 $ 18,603 $ 10,985 $ 19,032 $ 48,620 $ 4,876,542 91 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following table presents the payment status by class of loan at December 31, 2024: December 31, 2024 Current 30-59 Days Past Due 60-89 Days Past Due 90 Days or Greater Past Due Total Past Due Total Loans Commercial Owner occupied real estate $ 665,875 $ 1,195 $ — $ 95 $ 1,290 $ 667,165 Non–owner occupied real estate 1,500,229 931 — 296 1,227 $ 1,501,456 Residential spec homes 15,611 — — — — $ 15,611 Development & spec land 18,627 — — — — $ 18,627 Commercial and industrial 872,893 2,155 70 179 2,404 $ 875,297 Total commercial 3,073,235 4,281 70 570 4,921 3,078,156 Real estate Residential mortgage 773,214 — 4,163 6,584 10,747 $ 783,961 Residential construction 18,948 — — — — 18,948 Total real estate 792,162 — 4,163 6,584 10,747 $ 802,909 Consumer Direct installment 95,337 1,325 181 347 1,853 $ 97,190 Indirect installment 298,048 4,179 806 868 5,853 $ 303,901 Home equity 551,483 7,143 1,537 4,721 13,401 $ 564,884 Total consumer 944,868 12,647 2,524 5,936 21,107 965,975 Total $ 4,810,265 $ 16,928 $ 6,757 $ 13,090 $ 36,775 $ 4,847,040 The entire balance of a loan is considered delinquent if the minimum payment contractually required to be made is not received by the specified due date. 92 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Modified Loans The following tables detail the amortized cost as of December 31, 2025 and 2024 , respectively, of loans that were modified to borrowers experiencing financial difficulty during the year ended: December 31, 2025 Term Extension Interest Rate Reduction Other-Than-Insignificant Payment Delay Term Extension and Interest Rate Reduction Multiple 1 Total % of Loans Held for Investment Commercial Owner occupied real estate $ 550 $ — $ 5,242 $ 1,952 $ — $ 7,744 0.16 % Non-owner occupied real estate 398 — — — — 398 0.01 % Development spec & land 496 — — — — 496 0.01 % Commercial and industrial 3,383 — 598 1,952 — 5,933 0.12 % Total $ 4,827 $ — $ 5,840 $ 3,904 $ — $ 14,571 0.30 % 1 Multiple modifications represents modifications to borrowers in the form of term extensions and other-than-insignificant payment deferrals. December 31, 2024 Term Extension Interest Rate Reduction Other-Than-Insignificant Payment Delay Term Extension and Interest Rate Reduction Multiple 1 Total % of Loans Held for Investment Commercial Owner occupied real estate $ 2,038 $ — $ 651 $ 2,418 $ — $ 5,107 0.77 % Non-owner occupied real estate — — — — — — — % Development spec & land — — — — — — — % Commercial and industrial 3,448 — 740 236 — 4,424 0.51 % Total $ 5,486 $ — $ 1,391 $ 2,654 $ — $ 9,531 0.20 % 1 Multiple modifications represents modifications to borrowers in the form of term extensions and other-than-insignificant payment deferrals. 93 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following tables summarize the financial impacts of loan modifications and payment deferrals, as applicable, during the year ended December 31, 2025 and 2024, respectively. December 31, 2025 Weighted Average Term Extension (In Months) Weighted Average Interest Rate Reduction (In Percentage Terms) Weighted Average Payment Delay (In Months) Term Extension (In Months) & Rate Reduction (In Percentage Terms) Commercial Owner occupied real estate 17 — % 6 Weighted average term extension of 12 months & Weighted average interest rate reduction of 1.50 % Non-owner occupied real estate 12 — 0 0 Development & spec land 12 — 0 0 Commercial and industrial 17 — 5 Weighted average term extension of 30 months & Weighted average interest rate reduction of 1.73 % December 31, 2024 Weighted Average Term Extension (In Months) Weighted Average Interest Rate Reduction (Int Percentage Terms) Weighted Average Payment Delay (In Months) Term Extension (In Months) & Rate Reduction (In Percentage Terms) Commercial Owner occupied real estate 6 — % 5 Weighted average term extension of 60 months Weighted average interest rate reduction of 1.04 % Commercial and industrial 29 — 6 Weighted average term extension of 21 months Weighted average interest rate reduction of 2.25 % The financial impacts of the modifications did not significantly impact our determination of the allowance for credit losses during the periods presented above. 94 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following table presents the amortized cost basis at December 31, 2025 of loans to borrowers experiencing financial difficulty that had been modified within the previous 12 months: December 31, 2025 Current 30-89 Days Past Due 90 Days Past Due Total Commercial Owner occupied real estate $ 3,711 $ 1,845 $ 2,188 $ 7,744 Non-owner occupied real estate — 398 — 398 Development & spec land — $ 496 — 496 Commercial and industrial 5,238 253 442 5,933 Total $ 8,949 $ 2,992 $ 2,630 $ 14,571 The following table presents the amortized cost basis at December 31, 2024 of loans to borrowers experiencing financial difficulty that had been modified within the previous 12 months: December 31, 2024 Current 30-89 Days Past Due 90 Days Past Due Total Commercial Owner occupied real estate $ 5,107 $ — $ — $ 5,107 Non-owner occupied real estate — — — — Commercial and industrial 4,424 — — 4,424 Total $ 9,531 $ — $ — $ 9,531 During the years ended December 31, 2025 and 2024, the Company had $ 5.6 million and $ 0 , respectively of loans to borrowers experiencing financial difficulty that had a payment default and were modified within the twelve months prior to the payment default. For purposes of this disclosure, the Company defines “default” as being 30 days or more past due of contractual interest or principal. Collateral Dependent Financial Assets A collateral dependent financial loan relies solely on the operation or sale of the collateral for repayment. In evaluating the overall risk associated with the loan, the Company considers character, overall financial condition and resources, and payment record of the borrower; the prospects for support from any financially responsible guarantors; and the nature and degree of protection provided by the cash flow and value of any underlying collateral. However, as other sources of repayment become inadequate over time, the significance of the collateral's value increases and the loan may become collateral dependent. 95 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The tables below present the amortized cost basis and allowance for credit losses (“ACL”) allocated for collateral dependent loans in accordance with ASC 326, which are individually evaluated to determine expected credit losses, at December 31, 2025 and 2024. December 31, 2025 Real Estate Accounts Receivable/ Equipment Other Total ACL Allocation Commercial Owner occupied real estate $ 5,395 $ — $ — $ 5,395 $ 114 Non–owner occupied real estate 3,026 — — 3,026 20 Residential spec homes — — — — — Development & spec land 496 — — 496 — Commercial and industrial 1,690 3,269 673 5,632 882 Total commercial 10,607 3,269 673 14,549 1,016 Real Estate Residential Mortgage 929 — — 929 — Total Real Estate 929 — — 929 — Consumer Home equity 923 — — 923 313 Total consumer 923 — — 923 313 Total collateral dependent loans $ 12,459 $ 3,269 $ 673 $ 16,401 $ 1,329 December 31, 2024 Real Estate Accounts Receivable/ Equipment Other Total ACL Allocation Commercial Owner occupied real estate $ 2,448 $ — $ — $ 2,448 $ 224 Non–owner occupied real estate 444 — — 444 — Residential spec homes — — — — — Development & spec land 534 — — 534 — Commercial and industrial 1,756 476 — 2,232 731 Total commercial 5,182 476 — 5,658 955 Total collateral dependent loans $ 5,182 $ 476 $ — $ 5,658 $ 955 As of December 31, 2025, the Company had a carrying value of $ 1.7 million of repossessed assets. As of December 31, 2025, the Company had a recorded net investment of $ 0.9 million o f consumer mortgage loans in which foreclosure proceedings have commenced. Repossessed assets are a component of other assets within the consolidated balance sheet. Credit Quality Indicators Horizon Bank’s processes for determining credit quality differ slightly depending on whether a new loan or a renewed loan is being underwritten, or whether an existing loan is being re–evaluated for credit quality. The latter usually occurs upon receipt of current financial information or other pertinent data that would trigger a change in the credit quality grade. 96 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) • For new and renewed commercial loans, the Bank’s Credit Department, which acts independently of the loan officer, assigns the credit quality grade to the loan. Loan grades for loans with an aggregate credit exposure that exceeds the authorities in the respective regions (ranging from $ 3,000,000 to $ 6,000,000 ) are validated by the Loan Committee, which is chaired by the Chief Commercial Banking Officer (“CCBO”). • Commercial loan officers are responsible for reviewing their loan portfolios and promptly assessing any adverse change in credit quality and revising the risk rating appropriately. When circumstances warrant a change in the credit quality grade, loan officers are required to notify the Credit Department of the change in the credit quality grade. Downgrades are accepted immediately, however, lenders must present their factual information to the Credit Department when recommending an upgrade. Downgrades to impaired status require the concurrence of the CCBO and the Senior Workout Loan Manager. • The CCBO, or a designee, meets periodically with loan officers to discuss the status of past due loans and classified loans. These meetings are also designed to give the loan officers an opportunity to identify an existing loan that should be downgraded to a classified grade. • Monthly, senior management meets as members of the Watch Committee, which reviews all of the past due, classified, and impaired loans and the relative trends of these assets. This committee also reviews the actions taken by management regarding foreclosure mitigation, loan extensions, loan modifications, other real estate owned and personal property repossessions. The information reviewed in this meeting acts as a precursor for developing management’s analysis of the adequacy of the Allowance for Credit Losses on Loans and Leases. For residential real estate and consumer loans, Horizon uses a grading system based on delinquency. Loans that are 90 days or more past due, on non–accrual, or are classified as modified loans are graded “Substandard.” After being 90 to 120 days delinquent a loan is charged off unless it is well secured and in the process of collection. If the latter case exists, the loan is placed on non–accrual. Occasionally a mortgage loan may be graded as “Special Mention.” When this situation arises, it is because the characteristics of the loan and the borrower fit the definition of a Risk Grade 5 described below, which is normally used for grading commercial loans. Loans not graded Substandard are considered Pass. Horizon Bank employs a nine–grade rating system to determine the credit quality of commercial loans. The first five grades represent acceptable quality, and the last four grades mirror the criticized and classified grades used by the bank regulatory agencies (special mention, substandard, doubtful, and loss). The loan grade definitions are detailed below. Risk Grade 1: Excellent (Pass) Loans secured by liquid collateral, such as certificates of deposit, reputable bank letters of credit, or other cash equivalents or loans to any publicly held company with a current long–term debt rating of A or better and meeting defined key financial metric ranges. Risk Grade 2: Good (Pass) Loans to businesses that have strong financial statements containing an unqualified opinion from a CPA firm and at least three years consecutive years of profits; loans supported by unaudited financial statements containing strong balance sheets, five years consecutive years of profits, a five year satisfactory relationship with the Bank, and key balance sheet and income statement trends that are either stable or positive; loans secured by publicly traded marketable securities with required margins where there is no impediment to liquidation; loans to individuals backed by liquid personal assets and unblemished credit histories; or loans to publicly held companies with current long–term debt ratings of Baa or better and meeting defined key financial metric ranges. Risk Grade 3: Satisfactory (Pass) Loans supported by financial statements (audited or unaudited) that indicate average or slightly below average risk and having some deficiency or vulnerability to changing economic conditions; loans with some weakness but offsetting features of other support are readily available; loans that are meeting the terms of repayment, but which may be susceptible to deterioration if adverse factors are encountered and meeting defined key financial metric ranges. Loans may be graded Satisfactory when there is no recent information on which to base a current risk evaluation and the following conditions apply: 97 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) • At inception, the loan was properly underwritten, did not possess an unwarranted level of credit risk, and the loan met the above criteria for a risk grade of Excellent, Good, or Satisfactory; • At inception, the loan was secured with collateral possessing a loan value adequate to protect the Bank from loss. • The loan has exhibited two or more years of satisfactory repayment with a reasonable reduction of the principal balance. • During the period that the loan has been outstanding, there has been no evidence of any credit weakness. Some examples of weakness include slow payment, lack of cooperation by the borrower, breach of loan covenants, or the borrower is in an industry known to be experiencing problems. If any of these credit weaknesses is observed, a lower risk grade may be warranted. Risk Grade 4: Satisfactory/Monitored Loans in this category are considered to be of acceptable credit quality, but contain greater credit risk than Satisfactory rated loans and meet defined key financial metric ranges. Borrower displays acceptable liquidity, leverage, and earnings performance within the Bank’s minimum underwriting guidelines. The level of risk is acceptable but conditioned on the proper level of loan officer supervision. Loans that normally fall into this grade include acquisition, construction and development loans and income producing properties that have not reached stabilization. Risk Grade 4W: Management Watch Loans in this category are considered to be of acceptable quality and meet defined key financial metric ranges, but with above normal risk. Borrower displays potential indicators of weakness in the primary source of repayment resulting in a higher reliance on secondary sources of repayment. Balance sheet may exhibit weak liquidity and/or high leverage. There is inconsistent earnings performance without the ability to sustain adverse economic conditions. Borrower may be operating in a declining industry or the property type, as for a commercial real estate loan, may be high risk or in decline. These loans require an increased level of loan officer supervision and monitoring to assure that any deterioration is addressed in a timely fashion. Commercial construction loans are graded as 4W Management Watch until the projects are completed and stabilized. Risk Grade 5: Special Mention Loans which possess some temporary (normally less than one year) credit deficiency or potential weakness which deserves close attention. Such loans pose an unwarranted financial risk that, if not corrected, could weaken the loan by adversely impacting the future repayment ability of the borrower. The key distinctions of a Special Mention classification are that (1) it is indicative of an unwarranted level of risk and (2) weaknesses are considered “potential,” not “defined,” impairments to the primary source of repayment. These loans may be to borrowers with adverse trends in financial performance, collateral value and/or marketability, or balance sheet strength and must meet defined key financial metric ranges. Risk Grade 6: Substandard One or more of the following characteristics may be exhibited in loans classified Substandard: • Loans which possess a defined credit weakness. The likelihood that a loan will be paid from the primary source of repayment is uncertain. Financial deterioration is under way and very close attention is warranted to ensure that the loan is collected without loss. • Loans are inadequately protected by the current net worth and paying capacity of the obligor. • The primary source of repayment is gone, and the Bank is forced to rely on a secondary source of repayment, such as collateral liquidation or guarantees. • Loans have a distinct possibility that the Bank will sustain some loss if deficiencies are not corrected. • Unusual courses of action are needed to maintain a high probability of repayment. • The borrower is not generating enough cash flow to repay loan principal; however, it continues to make interest payments. 98 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) • The lender is forced into a subordinated or unsecured position due to flaws in documentation. • Loans have been restructured so that payment schedules, terms, and collateral represent concessions to the borrower when compared to the normal loan terms. • The lender is seriously contemplating foreclosure or legal action due to the apparent deterioration in the loan. • There is a significant deterioration in market conditions to which the borrower is highly vulnerable. • The borrower meets defined key financial metric ranges. Risk Grade 7: Doubtful One or more of the following characteristics may be present in loans classified Doubtful: • Loans have all of the weaknesses of those classified as Substandard. However, based on existing conditions, these weaknesses make full collection of principal highly improbable. • The primary source of repayment is gone, and there is considerable doubt as to the quality of the secondary source of repayment. • The possibility of loss is high but because of certain important pending factors which may strengthen the loan, loss classification is deferred until the exact status of repayment is known. • The borrower meets defined key financial metric ranges. Risk Grade 8: Loss Loans are considered uncollectible and of such little value that continuing to carry them as assets is not feasible. Loans will be classified Loss when it is neither practical nor desirable to defer writing off or reserving all or a portion of a basically worthless asset, even though partial recovery may be possible at some time in the future. 99 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The Company defines term loans as those having a fixed duration, repayment schedule and defined interest rate. Revolving loans include loans with revolving privileges and certain complex lending arrangements involving commitments made by the Company under predefined terms or loans with interchangeable interest rate and repayment options that extend beyond the time of origination. Revolving term loans include loans with revolving privileges and certain complex lending arrangements involving commitments made by the Company under predefined terms, including loans with both revolving and non-revolving components and loans with delayed draw down features. The following tables present loans by credit grades and origination year at December 31, 2025. Term Loans by Origination Year December 31, 2025 2025 2024 2023 2022 2021 Prior Revolving Term Loans Revolving Loans Total Commercial Owner occupied real estate Pass $ 103,721 $ 90,288 $ 83,508 $ 75,503 $ 61,816 $ 167,595 $ 69,454 $ 14,592 $ 666,477 Special Mention 900 5,013 — — 1,375 6,258 2,343 — 15,889 Substandard — 3,706 9,421 1,674 — 2,110 — 50 16,961 Doubtful — — — — — — — — — Total owner occupied real estate $ 104,621 $ 99,007 $ 92,929 $ 77,177 $ 63,191 $ 175,963 $ 71,797 $ 14,642 $ 699,327 Gross charge-offs during period $ 316 $ 502 $ — $ 50 $ — $ 49 $ 36 $ — $ 953 Non–owner occupied real estate Pass $ 195,568 $ 192,570 $ 152,602 $ 230,638 $ 133,516 $ 400,187 $ 306,632 $ 14,609 $ 1,626,322 Special Mention 490 — 1,304 28,267 — 5,771 — — 35,832 Substandard — 2,163 3,686 609 — 580 68 — 7,106 Doubtful — — — — — — — — — Total non–owner occupied real estate $ 196,058 $ 194,733 $ 157,592 $ 259,514 $ 133,516 $ 406,538 $ 306,700 $ 14,609 $ 1,669,260 Gross charge-offs during period $ — $ — $ — $ — $ — $ — $ — $ — $ — Residential spec homes Pass $ 4,896 $ 294 $ — $ — $ — $ — $ 5,329 $ 7,222 $ 17,741 Special Mention — — — — — — — — — Substandard — — — — — — — — — Doubtful — — — — — — — — — Total residential spec homes $ 4,896 $ 294 $ — $ — $ — $ — $ 5,329 $ 7,222 $ 17,741 Gross charge-offs during period $ — $ — $ — $ — $ — $ — $ — $ — $ — Development & spec land Pass $ 3,892 $ 816 $ 3,096 $ 746 $ 1,021 $ 1,813 $ 22,669 $ 986 $ 35,039 Special Mention — — — — — — — — — Substandard — — — — — — 496 — 496 Doubtful — — — — — — — — — Total development & spec land $ 3,892 $ 816 $ 3,096 $ 746 $ 1,021 $ 1,813 $ 23,165 $ 986 $ 35,535 Gross charge-offs during period $ — $ — $ — $ — $ — $ — $ — $ — $ — 100 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Commercial and industrial Pass $ 273,848 $ 193,508 $ 74,420 $ 102,213 $ 53,264 $ 52,660 $ 48,648 $ 172,692 $ 971,253 Special Mention 1,229 690 781 547 33 300 10,386 10,921 24,887 Substandard 2,027 2,073 6,490 82 32 1,578 1,001 1,122 14,405 Doubtful — — — — — — — — — Total commercial and industrial $ 277,104 $ 196,271 $ 81,691 $ 102,842 $ 53,329 $ 54,538 $ 60,035 $ 184,735 $ 1,010,545 Gross charge-offs during period $ — $ — $ — $ — $ — $ — $ — $ — $ — 101 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Term Loans by Origination Year December 31, 2025 2025 2024 2023 2022 2021 Prior Revolving Term Loans Revolving Loans Total Real estate Residential mortgage Performing $ 58,110 $ 76,445 $ 104,783 $ 143,616 $ 126,636 $ 221,710 $ — $ — $ 731,300 Non–performing — 505 2,428 2,236 453 4,555 — — 10,177 Total residential mortgage $ 58,110 $ 76,950 $ 107,211 $ 145,852 $ 127,089 $ 226,265 $ — $ — $ 741,477 Gross charge-offs during period $ — $ 135 $ 223 $ 188 $ 355 $ 161 $ — $ — $ 1,062 Residential construction Performing $ — $ 2,034 $ — $ — $ — $ — $ 28,916 $ — $ 30,950 Non–performing — — — — — — — — — Total residential construction $ — $ 2,034 $ — $ — $ — $ — $ 28,916 $ — $ 30,950 Gross charge-offs during period $ — $ — $ — $ — $ — $ — $ — $ — $ — Term Loans by Origination Year December 31, 2025 2025 2024 2023 2022 2021 Prior Revolving Term Loans Revolving Loans Total Consumer Direct installment Performing $ 8,330 $ 6,354 $ 47,094 $ 5,160 $ 3,160 $ 4,942 $ 84 $ 1,335 $ 76,459 Non–performing — — 578 69 40 28 — — 715 Total direct installment $ 8,330 $ 6,354 $ 47,672 $ 5,229 $ 3,200 $ 4,970 $ 84 $ 1,335 $ 77,174 Gross charge-offs during period $ 11 $ 141 $ 85 $ 73 $ 84 $ 5 $ 8 $ — $ 407 Indirect installment Performing $ — $ 220 $ 3,584 $ 9,469 $ 3,269 $ 1,902 $ — $ — $ 18,444 Non–performing — 29 275 570 232 122 — — 1,228 Total indirect installment $ — $ 249 $ 3,859 $ 10,039 $ 3,501 $ 2,024 $ — $ — $ 19,672 Gross charge-offs during period $ — $ 245 $ 885 $ 1,414 $ 477 $ 237 $ — $ — $ 3,258 Home equity Performing $ 12,301 $ 10,393 $ 16,623 $ 12,032 $ 4,444 $ 7,546 $ 32,721 $ 470,524 $ 566,584 Non–performing — 236 614 653 53 173 6,548 — 8,277 Total home equity $ 12,301 $ 10,629 $ 17,237 $ 12,685 $ 4,497 $ 7,719 $ 39,269 $ 470,524 $ 574,861 Gross charge-offs during period $ — $ — $ 20 $ 7 $ — $ 57 $ 843 $ — $ 927 102 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following table presents loans by credit grades and origination year at December 31, 2024. Term Loans by Origination year December 31, 2024 2024 2023 2022 2021 2020 Prior Revolving Term Loans Revolving Loans Total Commercial Owner occupied real estate Pass $ 75,649 $ 74,305 $ 90,872 $ 68,978 $ 36,778 $ 178,936 $ 92,227 $ 12,365 $ 630,110 Special Mention 129 — 1,724 1,769 142 8,759 — 100 12,623 Substandard 2,970 8,761 1,051 6,307 — 4,843 — 500 24,432 Doubtful — — — — — — — — — Total owner occupied real estate $ 78,748 $ 83,066 $ 93,647 $ 77,054 $ 36,920 $ 192,538 $ 92,227 $ 12,965 $ 667,165 Gross charge-offs during period $ — $ — $ — $ — $ — $ 1 $ — $ — $ 1 Non–owner occupied real estate Pass $ 194,167 $ 115,378 $ 244,266 $ 133,689 $ 100,688 $ 344,558 $ 298,288 $ 11,726 $ 1,442,760 Special Mention — 4,211 16,409 1,249 — 31,083 — — 52,952 Substandard 83 297 — — — 5,364 — — 5,744 Doubtful — — — — — — — — — Total non–owner occupied real estate $ 194,250 $ 119,886 $ 260,675 $ 134,938 $ 100,688 $ 381,005 $ 298,288 $ 11,726 $ 1,501,456 Gross charge-offs during period $ — $ — $ — $ — $ — $ — $ — $ — $ — Residential spec homes Pass $ 362 $ — $ — $ 420 $ — $ — $ 10,986 $ 3,843 $ 15,611 Special Mention — — — — — — — — — Substandard — — — — — — — — — Doubtful — — — — — — — — — Total residential spec homes $ 362 $ — $ — $ 420 $ — $ — $ 10,986 $ 3,843 $ 15,611 Gross charge-offs during period $ — $ — $ — $ — $ — $ — $ — $ — $ — Development & spec land Pass $ 819 $ 4,139 $ 788 $ 1,133 $ 328 $ 2,039 $ 7,931 $ 599 $ 17,776 Special Mention — — — — — 317 — — 317 Substandard — — — — — — 534 — 534 Doubtful — — — — — — — — — Total development & spec land $ 819 $ 4,139 $ 788 $ 1,133 $ 328 $ 2,356 $ 8,465 $ 599 $ 18,627 Gross charge-offs during period $ — $ — $ — $ — $ — $ — $ — $ — $ — Commercial and industrial Pass $ 242,562 $ 105,877 $ 128,707 $ 73,008 $ 6,954 $ 54,764 $ 48,313 $ 179,370 $ 839,555 103 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Special Mention 1,246 324 1,245 28 1 1,573 9,519 9,281 23,217 Substandard 843 2,599 318 217 266 3,170 1,003 4,109 12,525 Doubtful — — — — — — — — — Total commercial and industrial $ 244,651 $ 108,800 $ 130,270 $ 73,253 $ 7,221 $ 59,507 $ 58,835 $ 192,760 $ 875,297 Gross charge-offs during period $ — $ — $ — $ — $ — $ 45 $ 108 $ — $ 153 104 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Term Loans by Origination Year December 31, 2024 2024 2023 2022 2021 2020 Prior Revolving Term Loans Revolving Loans Total Real estate Residential mortgage Performing $ 69,264 $ 145,927 $ 160,780 $ 140,310 $ 78,563 $ 177,902 $ — $ — $ 772,746 Non–performing 201 1,619 2,125 1,472 706 5,092 — — 11,215 Total residential mortgage $ 69,465 $ 147,546 $ 162,905 $ 141,782 $ 79,269 $ 182,994 $ — $ — $ 783,961 Gross charge-offs during period $ — $ — $ — $ — $ — $ 5 $ — $ — $ 5 Residential construction Performing $ — $ — $ — $ — $ — $ — $ 18,948 $ — $ 18,948 Non–performing — — — — — — — — — Total residential construction $ — $ — $ — $ — $ — $ — $ 18,948 $ — $ 18,948 Gross charge-offs during period $ — $ — $ — $ — $ — $ — $ — $ — $ — Term Loans by Origination Year December 31, 2024 2024 2023 2022 2021 2020 Prior Revolving Term Loans Revolving Loans Total Consumer Direct installment Performing $ 11,306 $ 59,850 $ 9,510 $ 5,398 $ 2,679 $ 6,003 $ 60 $ 1,918 $ 96,724 Non–performing 1 374 46 19 — 26 — — 466 Total direct installment $ 11,307 $ 60,224 $ 9,556 $ 5,417 $ 2,679 $ 6,029 $ 60 $ 1,918 $ 97,190 Gross charge-offs during period $ 72 $ 93 $ 169 $ 1 $ 35 $ 78 $ 9 $ — $ 457 Indirect installment Performing $ 26,839 $ 70,143 $ 130,610 $ 49,458 $ 17,647 $ 7,304 $ — $ — $ 302,001 Non–performing — 425 800 304 242 129 — — 1,900 Total indirect installment $ 26,839 $ 70,568 $ 131,410 $ 49,762 $ 17,889 $ 7,433 $ — $ — $ 303,901 Gross charge-offs during period $ 161 $ 449 $ 1,345 $ 527 $ 188 $ 99 $ — $ — $ 2,769 Home equity Performing $ 13,552 $ 21,845 $ 16,136 $ 5,110 $ 1,902 $ 9,210 $ 18,657 $ 470,753 $ 557,165 Non–performing — 421 426 — 30 296 6,465 81 7,719 Total home equity $ 13,552 $ 22,266 $ 16,562 $ 5,110 $ 1,932 $ 9,506 $ 25,122 $ 470,834 $ 564,884 Gross charge-offs during period $ — $ 23 $ 52 $ 88 $ — $ 39 $ 110 $ 11 $ 323 105 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Note 5 – Allowance for Credit and Loan Losses The following table represents, by loan portfolio segment, a summary of changes in the ACL on loans for the twelve months ended December 31, 2025, 2024 and 2023 . Twelve Months Ended December 31, 2025 Commercial Real Estate Mortgage Warehouse Consumer Total Balance, beginning of period $ 30,953 $ 2,715 $ — $ 18,312 $ 51,980 Credit loss expense (recovery) 5,286 468 — ( 3,511 ) 2,243 Charge-offs ( 953 ) ( 1,062 ) — ( 4,592 ) ( 6,607 ) Recoveries 187 1,062 — 2,434 3,683 Balance, end of period $ 35,473 $ 3,183 $ — $ 12,643 $ 51,299 Twelve Months Ended December 31, 2024 Commercial Real Estate Mortgage Warehouse Consumer Total Balance, beginning of period $ 29,736 $ 2,503 $ 481 $ 17,309 $ 50,029 Provision for credit losses on loans 1,018 184 ( 481 ) 3,133 3,854 Charge-offs ( 154 ) ( 5 ) — ( 3,549 ) ( 3,708 ) Recoveries 353 33 — 1,419 1,805 Balance, end of period $ 30,953 $ 2,715 $ — $ 18,312 $ 51,980 Twelve Months Ended December 31, 2023 Commercial Real Estate Mortgage Warehouse Consumer Total Balance, beginning of period $ 32,445 $ 5,577 $ 1,020 $ 11,422 $ 50,464 Provision for credit losses on loans ( 1,765 ) ( 3,107 ) ( 539 ) 7,501 2,090 Charge-offs ( 1,403 ) ( 48 ) — ( 2,835 ) ( 4,286 ) Recoveries 459 81 — 1,221 1,761 Balance, end of period $ 29,736 $ 2,503 $ 481 $ 17,309 $ 50,029 The accrued interest receivable on our loan receivables is excluded from the allowance for credit loss estimate and is included in interest receivable on our consolidated balance sheets. As of December 31, 2025, December 31, 2024 and December 31, 2023, the accrued interest on our loan portfolio was $ 23.7 million, $ 25.6 million and $ 23.7 million, respectively. The Company utilized the Cumulative Loss Rate method in determining expected future credit losses. The loss rate method measures the amount of loan charge–offs, net of recoveries, (“loan losses”) recognized over the life of a closed pool and compares those loan losses to the outstanding loan balance of that pool as of a specific point in time (“pool date”). To estimate a CECL loss rate for the pool, management first identifies the loan losses recognized between the pool date and the reporting date for the pool and determines which loan losses were related to loans outstanding at the pool date. The loss rate method then divides the loan losses recognized on loans outstanding as of the pool date by the outstanding loan balance as of the pool date. 106 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The Company’s expected loss estimate is anchored in historical credit loss experience, with an emphasis on all available portfolio data. The Company’s historical look–back period includes January 2009 through the current period, on a monthly basis. When historical credit loss experience is not sufficient for a specific portfolio, the Company may supplement its own portfolio data with external models or data. The Company supplemented data for 2009 and 2010 with the use of adjusted Uniform Bank Performance Report peer group data. Qualitative reserves reflect management’s overall estimate of the extent to which current expected credit losses on collectively evaluated loans will differ from historical loss experience. The analysis takes into consideration other analytics performed within the organization, such as enterprise and concentration management, along with other credit–related analytics as deemed appropriate. Management attempts to quantify qualitative reserves whenever possible. The Company’s CECL estimate applies to a forecast that incorporates macroeconomic trends and other environmental factors. Management utilized Moody's economic forecast scenarios including both National and Regional econometrics, as well as management judgment, as the basis for the forecast period. The historical loss rate was utilized as the base rate, and qualitative adjustments were utilized to reflect the forecast and other relevant factors. The Company segments the loan portfolio into pools based on the following risk characteristics: financial asset type, loan purpose, collateral type, loan characteristics, credit characteristics, outstanding loan balances, contractual terms and prepayment assumptions, industry of the borrower and concentrations, and historical or expected credit loss patterns. Liability for Commitments to Extend Credit and Standby Letters of Credit The following tables represent, by loan portfolio segment, a summary of changes in the activity in the liability for commitments to extend credit and standby letters of credit (See Note 18): December 31, 2025 December 31, 2024 December 31, 2023 Balance, beginning of period Credit loss expense (reversal) Ending balance Balance, beginning of period Credit loss expense (reversal) Ending balance Balance, beginning of period Credit loss expense (reversal) Ending balance Commercial $ 1,385 $ ( 317 ) $ 1,068 $ — $ 1,385 $ 1,385 $ — $ — $ — Real Estate 61 31 92 64 ( 3 ) 61 161 ( 97 ) 64 Mortgage Warehouse — — — — — — — — — Consumer 703 ( 23 ) 680 551 152 703 242 309 551 Total $ 2,149 $ ( 309 ) $ 1,840 $ 615 $ 1,534 $ 2,149 $ 403 $ 212 $ 615 Note 6 – Premises and Equipment December 31 2025 December 31 2024 Land $ 31,106 $ 31,310 Buildings and improvements 93,806 91,911 Furniture and equipment 43,825 40,655 Total cost 168,737 163,876 Accumulated depreciation ( 75,932 ) ( 70,012 ) Net premises and equipment $ 92,805 $ 93,864 Depreciation of premises and equipment included in net occupancy expense for the years ended December 31, 2025, 2024 and 2023 was approximat ely $ 6.0 million, $ 5.8 million, and $ 5.9 million, r espectively. 107 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Note 7 – Loan Servicing Loans serviced for others are not included in the accompanying consolidated balance sheets. The unpaid principal balances of loans serviced for others totaled approximately $ 1.412 billion and $ 1.438 billion at December 31, 2025 and 2024. Activity for mortgage servicing rights and the related impairment allowance were as follows: December 31 2025 December 31 2024 December 31 2023 Mortgage servicing rights Balances, January 1 $ 18,195 $ 18,807 $ 18,619 Servicing rights capitalized 1,434 1,359 1,220 Amortization of servicing rights ( 2,095 ) ( 1,971 ) ( 1,032 ) Balances, December 31 17,534 18,195 18,807 Impairment allowance Beginning balance — — — Additions — — — Reductions — — — Balances, December 31 — — — Mortgage servicing rights, net $ 17,534 $ 18,195 $ 18,807 Fair value, beginning of period $ 19,766 $ 19,891 $ 19,992 Fair value, end of period $ 17,547 $ 19,766 $ 19,891 Fair value at December 31, 2025 was determined using a discounted cash flow analysis with the discount rates ranging from 8.5 % to 11.0 % and prepayment speeds ranging from 6.4 % to 12.0 % , depending on the stratification of the specific right. Fair value at December 31, 2024 was determined using a discounted cash flow analysis with a discount rates ranging from 9.0 % to 11.5 % and prepayment speeds ranging from 5.6 % to 13.3 % , depending on the stratification of the specific right. Note 8 – Goodwill The carrying amount of goodwill was $ 155.2 million as of December 31, 2025 and December 31, 2024, respectively. There were no changes in the carrying amount of goodwill for the year ended December 31, 2025 and 2024. Goodwill is assessed for impairment annually, or more frequently if events occur or circumstances change that indicate an impairment may exist. When assessing goodwill for impairment, first, a qualitative assessment can be made to determine whether it is more likely than not that the estimated fair value of a reporting unit is less than its estimated carrying value. If the results of the qualitative assessment are not conclusive, a quantitative goodwill test is performed. Alternatively, a quantitative goodwill test can be performed without performing a qualitative assessment. No goodwill impairment charges were recorded for the year ended December 31, 2025 and 2024. As of December 31, 2025, Horizon elected to perform a qualitative assessment to determine if it was more likely than not that the fair value exceeded its carrying value. The qualitative assessment indicated that it was more likely than not that the fair value exceeded its carrying value, resulting in no impairment. As a result of acquisitions, the Company has recorded certain amortizable intangible assets related to core deposit intangibles. These core deposit intangibles are being amortized over 7 years to 10 years using an accelerated method and had a weighted average remaining life of 3.34 years and 4.14 years as of December 31, 2025 and December 31, 2024. Amortizable intangible assets are summarized as follows: 108 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) December 31, 2025 December 31, 2024 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Amortizable intangible assets Core deposit intangible $ 33,633 $ ( 26,453 ) $ 33,633 $ ( 23,410 ) Amortization expense for intangible assets totaled $ 3.0 million, $ 3.4 million and $ 3.6 million for the years ended December 31, 2025, 2024 and 2023. Estimated amortization for the years ending December 31 is as follows: Year Amount 2026 $ 2,566 2027 2,119 2028 1,754 2029 512 2030 136 Thereafter 92 $ 7,179 Note 9 – Deposits December 31 2025 December 31 2024 Non interest-bearing demand deposits $ 1,078,708 $ 1,064,818 Interest-bearing deposits: Interest-bearing demand deposits 1,639,857 1,767,984 Money market 831,631 960,008 Savings deposits 622,743 718,689 Certificates of deposit of $250,000 or more 562,638 549,361 Certificates of deposit of less than $250,000 539,840 539,792 Total interest-bearing deposits $ 4,196,709 $ 4,535,834 Total deposits $ 5,275,417 $ 5,600,652 There were no overdraft customer transaction deposits reclassified as loan balances at December 31, 2025 and December 31, 2024. The aggregate amount of certificate of deposits (CD) and other time deposits (TD) in denominations of $100,000 or more at December 31, 2025 and 2024 were $ 807.0 million and $ 775.7 million, respectively. 109 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Certificates and other time deposits for both retail and brokered maturing in years ending December 31 are as follows: Retail Brokered Total 2026 $ 820,434 $ 90,033 $ 910,467 2027 12,216 65,000 77,216 2028 4,306 80,000 84,306 2029 3,794 — 3,794 2030 1,695 25,000 26,695 Thereafter — — — $ 842,445 $ 260,033 $ 1,102,478 Deposits received in the ordinary course of business from the directors and officers of the Company and their related interests amounted to $ 1.1 million and $ 1.3 million for the years ended December 31, 2025 and 2024, respectively. Note 10 – Borrowings December 31 2025 December 31 2024 Federal Home Loan Bank advances, variable and fixed rates ranging from 2.63 % to 3.78 %, due at various dates through April 7, 2027 $ 150,075 $ 1,130,148 Securities sold under agreements to repurchase, fixed rates ranging from 0.01 % to 3.33 %, due overnight and continuous 88,468 89,912 Federal funds purchased 169 — Secured borrowings, fixed rates ranging from 3.75 % to 9.00 %, due at various dates through March 28, 2043 9,874 12,192 Total borrowings $ 248,586 $ 1,232,252 The weighted average interest rate for FHLB advances was 3.78 % at December 31, 2025. The Federal Home Loan Bank advances are secured by first and second mortgage loans, and commercial real estate loans totaling approximately $ 2.5 billion. Advances are subject to restrictions or penalties in the event of prepayment. At December 31, 2025, the Bank had available approximately $ 1.7 billion in credit lines with various money center banks, including the FHLB. Contractual maturities in years ending December 31 are as follows: Year Amount 2026 91,506 2027 150,066 2028 — 2029 6,148 Thereafter 866 $ 248,586 110 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Note 11 – Repurchase Agreements The Company transfers various securities to customers in exchange for cash at the end of each business day and agrees to acquire the securities at the end of the next business day for the cash exchanged plus interest. The process is repeated at the end of each business day until the agreement is terminated. The securities underlying the agreement remained under the Company’s control. The following tables show repurchase agreements accounted for as secured borrowings and the related securities, at fair value, pledged for repurchase agreements: December 31, 2025 Remaining Contractual Maturity of the Agreements Overnight and Continuous Up to 30 Days 30-90 Days Greater Than 90 Days Total Repurchase Agreements and repurchase-to-maturity transactions U.S. government agency mortgage-backed securities $ 88,468 $ — $ — $ — $ 88,468 Total Repurchase Agreements $ 88,468 $ — $ — $ — $ 88,468 Repurchase Agreements subject to offsetting arrangements $ — December 31, 2024 Remaining Contractual Maturity of the Agreements Overnight and Continuous Up to 30 Days 30-90 Days Greater Than 90 Days Total Repurchase Agreements and repurchase-to-maturity transactions U.S. Treasury federal agencies $ 34,191 $ — $ — $ — $ 34,191 U.S. government agency mortgage-backed securities $ 55,721 $ — $ — $ — $ 55,721 Total Repurchase Agreements $ 89,912 $ — $ — $ — $ 89,912 Repurchase Agreements subject to offsetting arrangements — Securities sold under agreements to repurchase are secured by securities with a carrying amount of $ 90.7 million and $ 96.8 million at December 31, 2025 and December 31, 2024, respectively. Note 12 – Subordinated Notes On August 29, 2025, Horizon completed the offering and sale of $ 100.0 million in aggregate principal amount of its 7.000 % Fixed-to-Floating Rate Subordinated Notes due 2035 (the “2035 Notes”). The 2035 Notes were issued by Horizon at a price equal to 100 % of their face amount. Horizon used the net proceeds from the offering for general corporate purposes, including in support of the repositioning of its balance sheet, and to redeem approximately $ 56.5 million in aggregate principal amount of its 5.625 % fixed-to-floating rate subordinated notes due 2030 (the "2030 Notes," and collectively with the 2035 Note, the "Notes"), which was completed on October 1, 2025. The 2035 Notes will bear interest at a fixed interest rate of 7.000 % per annum until September 15, 2030, after which time the interest rate will reset quarterly to a floating rate equal to a benchmark rate, which is expected to be the then current three-month term Secured Overnight Financing Rate (SOFR) plus 360 basis points until the 2035 Notes' maturity on September 15, 2035. The 2035 Notes are redeemable by Horizon, in whole or in part, on any interest payment date on or after September 15, 2030, and at any time upon the occurrence of certain events, subject to the receipt of the approval of the Board of Governors of the Federal Reserve System to the extent then required under applicable laws or regulations, including capital regulations. The 2035 Notes are intended to qualify as Tier 2 capital of the 111 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Company for regulatory capital purposes. On December 8, 2023, Horizon cancelled $ 3.5 million of the $ 60.0 million in 2030 Notes at a price of 89.5 recording a gain of 0.4 million. The balance of the Notes, net of unamortized issuance costs, was $ 98.2 million and $ 55.7 million at December 31, 2025 and December 31, 2024, respectively. Unamortized debt issuance costs recorded were $ 1.8 million and $ 0.8 million at December 31, 2025 and December 31, 2024, respectively. Note 13 – Junior Subordinated Debentures Issued to Capital Trusts In October of 2004, Horizon formed Horizon Statutory Trust II (“Trust II”), a wholly owned statutory business trust. Trust II sold $ 10.0 million of Trust Preferred Capital Securities as a participant in a pooled trust preferred securities offering. The proceeds from the sale of the trust preferred securities were used by the trust to purchase an equivalent amount of subordinated debentures from Horizon. The junior subordinated debentures are the sole assets of Trust II and are fully and unconditionally guaranteed by Horizon. The junior subordinated debentures and the trust preferred securities pay interest and dividends on a quarterly basis. The junior subordinated debentures and the securities bear interest at a rate of 3 Month CME Term SOFR plus 2.21 % ( 6.09 % at December 31, 2025) and mature on November 23, 2034, and securities may be called at any quarterly interest payment date at par. In December of 2006, Horizon formed Horizon Bancorp Capital Trust III (“Trust III”), a wholly owned statutory business trust. Trust III sold $ 12.0 million of Trust Preferred Capital Securities as a participant in a pooled trust preferred securities offering. The proceeds from the sale of the trust preferred securities were used by the trust to purchase an equivalent amount of subordinated debentures from Horizon. The junior subordinated debentures are the sole assets of Trust III and are fully and unconditionally guaranteed by Horizon. The junior subordinated debentures and the trust preferred securities pay interest and dividends on a quarterly basis. The junior subordinated debentures and the securities bear interest at a rate of 3 Month CME Term SOFR plus 1.91 % ( 5.75 % at December 31, 2025) and mature on January 30, 2037, and securities may be called at any quarterly interest payment date at par. The Company assumed additional debentures as the result of the acquisition of Alliance Bank Corporation in 2005. In June 2004, Alliance formed Alliance Financial Statutory Trust I a wholly owned business trust (“Alliance Trust”), to sell $ 5.0 million in trust preferred securities. The proceeds from the sale of the trust preferred securities were used by the trust to purchase an equivalent amount of subordinated debentures from Alliance. The junior subordinated debentures are the sole assets of Alliance Trust and are fully and unconditionally guaranteed by Horizon. The junior subordinated debentures and the trust preferred securities pay interest and dividends on a quarterly basis. The junior subordinated debentures and the securities bear interest at a rate of 3 Month CME Term SOFR plus 2.91 % ( 6.62 % at December 31, 2025) and mature in June 2034, and securities may be called at any quarterly interest payment date at par. The Company assumed additional debentures as the result of the American Trust & Savings Bank purchase and assumption in 2010. In March 2004, Am Tru Inc., the holding company for American Trust & Savings Bank, formed Am Tru Statutory Trust I a wholly owned business trust (“Am Tru Trust”), to sell $ 3.5 million in trust preferred securities. The proceeds from the sale of the trust preferred securities were used by the trust to purchase an equivalent amount of subordinated debentures from Am Tru Inc. The junior subordinated debentures are the sole assets of Am Tru Trust and are fully and unconditionally guaranteed by Horizon. The junior subordinated debentures and the trust preferred securities pay interest and dividends on a quarterly basis. The junior subordinated debentures and the securities bear interest at a rate of 3 Month CME Term SOFR plus 2.85 % ( 6.82 % at December 31, 2025) and mature in December 2033, and securities may be called at any quarterly interest payment date at par. The Company assumed additional debentures as the result of the Heartland merger in July 2012. In December 2006, Heartland formed Heartland (IN) Statutory Trust II a wholly owned business trust (“Heartland Trust”), to sell $ 3.0 million in trust preferred securities. The proceeds from the sale of the trust preferred securities were used by the trust to purchase an equivalent amount of subordinated debentures from Heartland. The junior subordinated debentures are the sole assets of Heartland Trust and are fully and unconditionally guaranteed by Horizon. The junior subordinated debentures and the trust preferred securities pay interest and dividends on a quarterly basis. The junior subordinated debentures and the securities bear interest at a rate of 3 Month CME Term SOFR plus 112 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) 1.93 % ( 5.65 % at December 31, 2025) and mature in December 2036, and securities may be called at any quarterly interest payment date at par. The carrying value was $ 2.3 million, net of the remaining purchase discount, at December 31, 2025. The Company assumed additional debentures as the result of the LaPorte merger in July 2016. In October 2007, LaPorte as sumed debentures as the result of its acquisition of City Savings Financial Corporation (“City Savings”). In June 2003, City Savings formed City Savings Statutory Trust I a wholly owned business trust (“City Savings Trust”), to sell $ 5.0 million in trust preferred securities. The proceeds from the sale of the trust preferred securities were used by the trust to purchase an equiv alent amount of subordinated debentures from City Savings. The junior subordinated debentures are the sole assets of City Savings Trust and are fully and unconditionally guaranteed by Horizon. The junior subordinated debentures and the trust preferred securities pay interest and dividends on a quarterly basis. The junior subordinated debentures and the securities bear interest at a rate of 3 Month CME Term SOFR plus 3.10 % ( 7.05 % at December 31, 2025) and mature in June 2033, and securities may be called at any quarterly interest payment date at par. The carrying value was $ 4.6 million, net of the remaining purchase discount, at December 31, 2025. The Company assumed additional debentures as the result of the Salin merger in March 2019. In October 2003, Salin Bancshares, Inc. (“Salin”) formed Salin Statutory Trust I (“Salin Trust”), to sell $ 19.0 million in trust preferred securities. The proceeds from the sale of the trust preferred securities were used by the trust to purchase an equivalent amount of subordinated debentures from Salin. The junior subordinated debentures are the so le assets of Salin Trust and are fully and unconditionally guaranteed by Horizon. The junior subordinated debentures and the securities bear interest at a rate of 3 Month CME Term SOFR plus 2.95 % ( 6.88 % at December 31, 2025) and mature in October 2033, and securities may be called at any quarterly interest payment date at par. The carrying value was $ 18.5 million, net of the remaining purchase discount, at December 31, 2025. The Trust Preferred Capital Securities, subject to certain limitations, are included in Tier 1 Capital for regulatory purposes. Dividends on the Trust Preferred Capital Securities are recorded as interest expense. Note 14 – Non-Qualified Deferred Compensation Plan The Company sponsors a non-qualified deferred compensation plan for a select group of management or highly compensated employees of the Company under the Horizon Bancorp Non-Qualified Deferred Compensation Plan (“DCP). This plan was effective January 1, 2025, as an amendment to the Horizon Bancorp 2005 Supplemental Executive Retirement Plan (“SERP”). The DCP provides participating officers with the ability to defer income in addition to the benefits provided under the Company's Employee Thrift Plan. The DCP is a deferred compensation plan under which benefits are derived based on a notional account balance to be funded by the Company for each participating officer. The account balance was credited with a Company matching contribution based on the amount of the employee’s contribution. The matching formula is 100 % of the employees first 2 % contribution of their salary and 50 % of the next 4 % up to a maximum of eligible compensation. Plan participants could select from a variety of investment options which mirror the options provided under the Company’s Employee Thrift Plan. Assets of the DCP (i.e. the participants' account balances) were not physically invested in the investments selected by the participants; rather, they are utilized for the purpose of debiting or crediting additional amounts to each participants' account. The Company informally funded its obligation to plan participants in a rabbi trust, which is consolidated by the Company, and is comprised of investment options similar to those selected by the Participants. The assets held in the rabbi trust were reported at their estimated fair value of $ 11.0 million at December 31, 2025 and were included in cash and other assets in the Company's consolidated balance sheets. The amounts held in the rabbi trust were reported at their estimated fair value of $ 10.7 million at December 31, 2024 and were included in cash a nd stockholders' equity in the Company's consolidated balance sheets. The related accrued benefit cost (representing the Company's benefit obligation to participants) of $ 11.0 million and $ 10.7 million at December 31, 2025 and December 31, 2024, respectively, was recorded in other liabilities in the Company's consolidated balance sheets. The DCP is accounted for pursuant to FASB ASC section 710-10, “Compensation - Overall” (“ASC 710-10”). Participants are credited with a contribution to an account and will receive, upon separation, a benefit based upon the vested amount accrued in their account, which includes both the officer's and Company's contributions plus or minus the increase or decrease in the fair market value of the assets selected by the participant. ASC 710-10 113 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) requires the Company to record a liability and related compensation expense during the service period. The Company is accruing the expense under the assumption that all participants in will achieve full vesting ( six years of service). Following the vesting period, the liability continues to be remeasured each reporting period until extinguishment of the liability, with offsetting adjustments to compensation costs. The Company matching contribution and related expense was $ 280 thousand, $ 433 thousand and $ 344 thousand for the years ended December 31, 2025, December 31, 2024 and December 31, 2023, respectively. The DCP is included with Equity securities in other assets in Note 22 - Disclosures about fair value of assets and liabilities. Note 15 – Employee Benefit Plans The Employee Thrift Plan (“Plan”) provides that all employees of Horizon with the requisite hours of service are eligible for the Plan. The Plan permits voluntary employee contributions and Horizon may make discretionary matching and profit sharing contributions. Each eligible employee is vested according to a schedule based upon years of service. Employee voluntary contributions are vested at all times. The Bank’s expense related to the Plan totaled approximately $ 2.1 million in 2025, $ 1.7 million in 2024 and $ 1.9 million in 2023 . The Plan owned a total of 581,791 shares of Horizon’s stock or 1.1 % of the outstanding shares as of December 31, 2025. Note 16 – Income Tax Income tax expense (benefit) was as follows: December 31 2025 December 31 2024 December 31 2023 Income tax expense (benefit) Currently payable Federal $ 21,195 $ 8,558 $ 14,980 State 13,606 363 ( 640 ) Deferred Federal ( 72,848 ) ( 15,528 ) ( 3,393 ) State ( 12,624 ) ( 1,472 ) 71 Total income tax expense (benefit) $ ( 50,671 ) $ ( 8,079 ) $ 11,018 A reconciliation between reported income tax expense and the amounts computed by applying the U.S. federal statutory income tax rate of 21% to income before income taxes is presented in the following table. There were no activities or transactions that had foreign income taxes or cross-border tax effects during the reported periods. State income/franchise taxes are primarily related to the State of Indiana, while amounts related to other jurisdictions were not significant, in the aggregate, during the reported periods. 114 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) 2025 2024 2023 Reconciliation of federal statutory to actual tax expense (benefit) Amount Percent Amount Percent Amount Percent Tax expense (benefit) calculated at the statutory federal income tax rate $ ( 42,242 ) 21 % $ 5,743 21 % $ 8,190 21 % State and local income tax, net of federal income tax effect (a) ( 1,844 ) 1 % ( 1,185 ) ( 4 ) % 142 — % Tax credit investments, net of amortization ( 1,105 ) 1 % ( 1,290 ) ( 5 ) % ( 2,976 ) ( 8 ) % Income not subject to tax Tax Exempt Interest ( 5,277 ) 3 % ( 6,427 ) ( 24 ) % ( 6,777 ) ( 17 ) % Tax exempt BOLI income ( 417 ) — % ( 273 ) ( 1 ) % ( 779 ) ( 2 ) % Nondeductible Expenses 227 — % 404 1 % 628 2 % Other, net ( 13 ) — % 150 1 % ( 459 ) ( 1 ) % Revaluation of deferred tax assets — — % ( 5,201 ) ( 19 ) % 5,201 13 % BOLI redemption ordinary income — — % — — % 5,316 14 % BOLI redemption excise — — % — — % 2,532 7 % Actual tax expense (benefit) $ ( 50,671 ) 25.2 % $ ( 8,079 ) ( 29.5 ) % $ 11,018 28.2 % (a) State taxes in Indiana make up the majority (greater than 50 percent) of the tax effect in this category 115 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Year-end deferred taxes are presented in the table below. December 31 2025 December 31 2024 Assets Allowance for credit losses $ 12,578 $ 12,590 Net operating loss and tax credits 461 10,805 Director and employee benefits 5,342 3,334 Unrealized loss on AFS securities and fair value hedge 20,482 29,355 Net capitalized expenses 96,561 — Basis in partnership equity investments 2,649 1,940 Fair value adjustment on acquisitions 789 883 Other 2,613 2,938 Total assets 141,475 61,845 Liabilities Depreciation ( 4,213 ) ( 4,061 ) Federal Home Loan Bank stock dividends ( 297 ) ( 353 ) Difference in basis of intangible assets ( 5,821 ) ( 6,553 ) Other ( 1,291 ) ( 1,003 ) Total liabilities ( 11,622 ) ( 11,970 ) Valuation allowance — — Net deferred tax asset/(liability) $ 129,853 $ 49,875 Cash paid for income taxes was as follows: December 31 2025 December 31 2024 December 31 2023 Cash paid for income taxes Federal $ 10,536 $ 10,710 $ 2,137 State Indiana 15,869 — — All others 1,002 — — Total $ 27,407 $ 10,710 $ 2,137 The Company has federal general business tax credits of $ 0.4 million that can be carried forward twenty years and expire beginning in 2044. The Company accounts for qualifying investment tax credits using the proportional amortization method and all others under the deferral method. Investment tax credits totaled $ 5.1 million and $ 7.5 million for 2025 and 2024 , respectively. The Company recorded no valuation allowance for the year December 31, 2025 and 2024 . The Company believes all of its deferred tax assets as of December 31, 2025 will be realized. Retained earnings of the Bank include approximately $ 12.8 million for which no deferred income tax liability has been recognized. This amount represents an allocation of previously acquired institutions income to bad debt deductions as of December 31, 1987 for tax purposes only. Reductions of amounts so allocated for purposes other than tax bad debt losses including redemption of bank stock or excess dividends, or loss of “bank” status would 116 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) create income for tax purposes only, which would be subject to the then-current corporate income tax rate. The unrecorded deferred income tax liability on the above amount for the Company was approximately $ 2.7 million at December 31, 2025. The Company files income tax returns in U.S. federal, state and local jurisdictions. With a few exceptions, the Company is no longer subject to U.S. federal, state and local or non-U.S. income tax examinations by tax authorities for years before 2021. Note 17 – Stockholders' Equity Accumulated Other Comprehensive Income (Loss) The components of accumulated other comprehensive loss, net of tax included in capital are as follows: December 31 2025 December 31 2024 Unrealized gain (loss) on securities available for sale $ ( 25,996 ) $ ( 38,193 ) Unamortized gain (loss) on securities held to maturity, previously transferred from AFS — 1,892 Total accumulated other comprehensive income (loss) $ ( 25,996 ) $ ( 36,301 ) Common Stock On August 22, 2025, the Company closed a public offering of 7,138,050 shares of its common stock, at a price to the public of $ 14.50 per share, which included 931,050 shares of the Company’s common stock granted pursuant to the underwriters’ option to purchase additional shares at the public offering price, less underwriting discounts. This offering generated net proceeds of approximately $ 98.0 million after deducting the underwriting discounts and commissions and offering expenses payable by the Company. Note 18 – Off-Balance Sheet Arrangements, Commitments, and Contingencies In the normal course of business, the Company is a party to financial instruments with off-balance sheet risk to meet the financing needs of its clients. These financial instruments include commitments to extend credit and standby letters of credit. These instruments involve, to varying degrees, elements of credit and interest rate risk in excess of amounts recorded in the consolidated balance sheets. Commitments to extend credit are legally binding agreements to lend to a client, so long as there is no violation of any condition established in the commitment contract. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a client to a third party. The credit risk involved in issuing letters of credit is essentially the same as the credit risk involved in extending loan facilities to clients. The Company’s policy for obtaining collateral, and determining the nature of such collateral, is essentially the same as in the Company’s policies for making commitments to extend credit. The methodology for estimating the liability for unfunded loan commitments is consistent with the allowance for credit losses on loans. 117 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following table represents the commitments to extend credit and standby letters of credit as of December 31, 2025 and December 31, 2024, respectively: December 31, 2025 December 31, 2024 Commitments to extend credit $ 1,124,850 $ 1,018,302 Commitments under outstanding standby letters of credit $ 22,274 $ 23,457 Total $ 1,147,124 $ 1,041,759 Note 19 – Regulatory Capital Horizon and the Bank are subject to various regulatory capital requirements administered by the federal banking agencies. These capital requirements implement changes arising from the Dodd–Frank Wall Street Reform and Consumer Protection Act and the U.S. Basel Committee on Banking Supervision’s capital framework (known as “Basel III”). Failure to meet the minimum regulatory capital requirements can initiate certain mandatory and possible additional discretionary actions by regulators, which if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective actions, the Company and Bank must meet specific capital guidelines involving quantitative measures of the Bank’s assets, liabilities, and certain off–balance–sheet items as calculated under regulatory accounting practices. The Company’s and Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. The Company and Bank are subject to minimum regulatory capital requirements as defined and calculated in accordance with the Basel III–based regulations. As allowed under Basel III rules, the Company made the decision to opt–out of including accumulated other comprehensive income in regulatory capital. The minimum regulatory capital requirements are set forth in the table below. In addition, to be categorized as well capitalized, the Company and Bank must maintain Total risk–based, Tier I risk–based, common equity Tier I risk–based and Tier I leverage ratios as set forth in the table below. As of December 31, 2025 and December 31, 2024, the Company and Bank met all capital adequacy requirements to be considered well capitalized. There have been no conditions or events since the end of the year 2025 that management believes have changed the Bank’s classification as well capitalized. There is no threshold for well capitalized status for bank holding companies. 118 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following table presents Horizon and the Bank’s actual and required capital ratios as of December 31, 2025 and December 31, 2024: Actual Required for Capital Adequacy Purposes (1) Required For Capital Adequacy Purposes with Capital Buffer (1) Well Capitalized Under Prompt Corrective Action Provisions (1) Amount Ratio Amount Ratio Amount Ratio Amount Ratio December 31, 2025 Total capital (to risk-weighted assets) (1) Consolidated $ 762,541 14.36 % $ 424,791 8.00 % $ 557,538 10.50 % N/A N/A Bank 687,316 12.99 % 423,209 8.00 % 555,461 10.50 % $ 529,011 10.00 % Tier 1 capital (to risk-weighted assets) (1) Consolidated 611,186 11.51 % 318,593 6.00 % 451,340 8.50 % N/A N/A Bank 634,176 11.99 % 317,407 6.00 % 449,659 8.50 % 423,209 8.00 % Common equity tier 1 capital (to risk-weighted assets) (1) Consolidated 553,498 10.42 % 238,945 4.50 % 371,692 7.00 % N/A N/A Bank 634,176 11.99 % 238,055 4.50 % 370,308 7.00 % 343,857 6.50 % Tier 1 capital (to average assets) (1) Consolidated 611,186 9.55 % 256,006 4.00 % 256,006 4.00 % N/A N/A Bank 634,176 9.94 % 255,282 4.00 % 255,282 4.00 % 319,103 5.00 % Actual Required for Capital Adequacy Purposes (1) Required For Capital Adequacy Purposes with Capital Buffer (1) Well Capitalized Under Prompt Corrective Action Provisions (1) Amount Ratio Amount Ratio Amount Ratio Amount Ratio December 31, 2024 Total capital (to risk-weighted assets) (1) Consolidated $ 800,209 13.91 % $ 460,266 8.00 % $ 604,099 10.50 % N/A N/A Bank 725,383 12.64 % 459,039 8.00 % 602,489 10.50 % $ 573,799 10.00 % Tier 1 capital (to risk-weighted assets) (1) Consolidated 690,183 12.00 % 345,199 6.00 % 489,033 8.50 % N/A N/A Bank 671,095 11.70 % 344,279 6.00 % 487,729 8.50 % $ 459,039 8.00 % Common equity tier 1 capital (to risk-weighted assets) (1) Consolidated 632,760 11.11 % 258,900 4.50 % 402,733 7.00 % N/A N/A Bank 671,095 11.70 % 258,209 4.50 % 401,659 7.00 % $ 372,969 6.50 % Tier 1 capital (to average assets) (1) Consolidated 690,183 8.88 % 310,825 4.00 % 310,825 4.00 % N/A N/A Bank 671,095 8.64 % 310,539 4.00 % 310,539 4.00 % $ 388,174 5.00 % (1) As defined by regulatory agencies 119 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Note 20 – Share–Based Compensation On June 18, 2013, the Board of Directors adopted the Horizon Bancorp 2013 Omnibus Equity Incentive Plan (“2013 Plan”), which was approved by the Company’s shareholders on May 8, 2014. Under the 2013 Plan, Horizon may issue up to 1,556,325 common shares, plus the number of shares that are tendered to or withheld by Horizon in connection with the exercise of options under the 2013 Plan plus that number of shares that are purchased by Horizon with the cash proceeds received upon option exercises. The 2013 Plan limits the number of shares available to 225,000 for incentive stock options and to 900,000 for the grant of non–option awards. The shares available for issuance under the 2013 Plan may be divided among the various types of awards and among the participants as the Committee determines. The Committee is authorized to grant any type of award to a participant that is consistent with the provisions of the 2013 Plan. Awards may consist of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, performance units, performance shares or any combination of these awards. The Committee determines the provisions, terms and conditions of each award. The 2013 Plan was amended on May 3, 2018, upon shareholder approval, primarily to allow grants of other types of stock–based awards, such as awards valued in whole or in part by reference to the value of shares of Horizon common stock. All share data has been adjusted for the 3:2 stock split on June 15, 2018 and November 14, 2016. The restricted shares can vest over a period of time established by the Committee at the time of each grant, but the restricted shares already granted under the 2013 Plan generally cliff vest at the end of three years of continuous employment. Holders of restricted shares have the same dividend and voting rights as unrestricted shares. The restricted shares are recorded at fair market value (on the date granted) as a separate component of s tockholders’ equity. The cost of these shares is being amortized against earnings using the straight–line method over the vesting period. There were no unvested restricted shares outstanding in the 2013 Plan as of December 31, 2024 and December 31, 2025. The performance shares that are awarded become earned and vested based on the achievement of certain performance goals during a performance period as established by the Committee at the time of each grant. The performance goals under the outstanding grant agreements are based on a comparison of the Company’s average performance over the performance period for the return on common equity, compounded annual growth rate of total assets, and return on average assets, all as relative to the average performance for publicly traded banks with total assets between $ 1 billion and $ 5 billion on the SNL Bank Index. Holders of performance share awards receive pass–through dividends but do not have any voting rights before the performance shares are earned and vested. There were no unvested performance shares outstanding in the 2013 Plan as of December 31, 2024 and December 31, 2025. The options shares granted under the 2013 Plan vest at a rate designated per the individual agreements. The fair value of options granted is estimated on the date of the grant using an option–pricing model. There have been no options granted since 2019. 120 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) A summary of option activity under the 2013 Plan as of December 31, 2025, and changes during the year then ended, is presented below: Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding, beginning of year 94,798 $ 16.87 2.84 years $ 56,985 Granted — — — Exercised ( 7,695 ) 10.38 126,429 Forfeited ( 1,500 ) 16.76 — Expired — — — Outstanding, end of year 85,603 $ 17.46 2.00 years $ 14,805 Exercisable, end of year 85,603 $ 17.46 2.00 years 14,805 There have been no options gr anted under the 2013 Plan during the years 2025, 2024 and 2023. The total intrinsic value of stock options exercised was approximately $ 126 thousand , $ 418 thousand , and $ 355 thousand for the years ended December 31, 2025, 2024, and 2023. On January 19, 2021, the Board of Directors adopted the Horizon Bancorp 2021 Omnibus Equity Incentive Plan (“2021 Plan”), which was approved by the Company’s shareholders on May 6, 2021. Under the 2021 Plan, Horizon may issue up to 1,787,548 common shares, plus the number of shares that are tendered to or withheld by Horizon in connection with the exercise of options under the 2021 Plan plus that number of shares that are purchased by Horizon with the cash proceeds received upon option exercises. The Committee is authorized to grant any type of award to a participant that is consistent with the provisions of the 2021 Plan. Awards may consist of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, performance units, performance shares or any combination of these awards. The Committee determines the provisions, terms and conditions of each award. The restricted shares can vest over a period of time established by the Committee at the time of each grant, but the restricted shares already granted under the 2021 Plan generally cliff vest at the end of three years of continuous employment. Holders of restricted shares have the same dividend and voting rights as unrestricted shares. The restricted shares are recorded at fair market value (on the date granted) as a separate component of stockholders’ equity. The cost of these shares is being amortized against earnings using the straight–line method over the vesting period. The performance shares that are awarded become earned and vested based on the achievement of certain performance goals during a performance period as established by the Committee at the time of each grant. The performance goals under the outstanding grant agreements are based on a comparison of the Company’s average performance over the performance period for the return on common equity, compounded annual growth rate of total assets, and return on average assets, all as relative to the average performance for publicly traded banks with total assets between $ 5 billion and $ 10 billion on the SNL Bank Index. Holders of performance awards receive pass–through dividends but do not have any voting rights before the performance shares are earned and vested. The option shares granted under the 2021 Plan vest at a rate designated per the individual agreements. As of December 31, 2025, there have been no stock options granted under the 2021 Plan. 121 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) A summary of the status of Horizon’s non–vested restricted and performance shares under the 2021 Plan as of December 31, 2025 are presented below: Shares Weighted Average Grant Date Fair Value Non-vested, beginning of year 718,197 $ 13.73 Vested ( 374,108 ) 14.74 Granted 146,436 15.76 Forfeited ( 34,021 ) 20.03 Non-vested, end of year 456,504 13.08 The total fair value of shares vested during 2025, 2024 and 2023 were $ 5.9 million, $ 2.0 million, and $ 1.8 million, respectively. The Company did not have option-based compensation expense applicable to the Company’s share-based compensation plans for the years ended December 31, 2025 or December 31, 2024. The Company does not have any unrecognized option-based compensation expense related to unvested options as of December 31, 2025. Compensation expense recognized in the income statement for restricted share and performance share based payment arrangements during 2025, 2024 and 2023 was $ 1.6 million, $ 4.6 million, and $ 3.6 million. The recognized tax benefit related thereto was approximately $ 340 thousand, $ 963 thousand, and $ 753 thousand for the years ended December 31, 2025, 2024 and 2023. There was no cash received from option exercise under all share–based payment arrangements for the years ended December 31, 2025 and 2024. The actual tax benefit realized for the tax deductions from option exercise of the share–based payment arrangements totaled $ 22 thousand, $ 72 thousand, and $ 58 thousand, for the years ended December 31, 2025, 2024 and 2023. As of December 31, 2025, there was $ 2.4 million of total unrecognized compensation cost related to all non–vested share–based compensation arrangements granted under all of the plans. That cost is expected to be recognized over a weighted–average period of 11 months. Note 21 – Derivative Financial Instruments Our hedging policy allows the use of interest rate derivative instruments to manage our exposure to interest rate risk or hedge specified assets and liabilities. All derivative instruments are carried on the balance sheet at their estimated fair value and are recorded in other assets or other liabilities, as appropriate, and in the net change in each of these financial statement line items in the accompanying consolidated statement of cash flows. Fair Value Hedges Fair value hedges are intended to manage interest rate risk associated with the underlying hedged items. The Company utilizes fair value hedges and applies the portfolio layer method to hedge stated amounts within a closed portfolio of certain available-for-sale mortgage-backed debt securities. To mitigate the impact of interest rate fluctuations on fair value, the Company previously entered into interest rate swap agreements on individual loans, converting the fixed rate loans to a variable rate. The Company also previously utilized fair value hedges to hedge investment securities, converting the fixed rate security to a variable rate. Changes in fair value of both the hedge instruments and the underlying loan and security agreements are recorded as gains or losses in interest income. During the year ended December 31, 2024, the Company terminated the fair value hedges on loans and securities, recording a deferred gain of $ 2.3 million on the loan termination that will be accreted into interest income over the remaining life of the underlying loans, and a mark-to- 122 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) market adjustment of $ 0.3 million that was recorded in non-interest income on the termination of the fair value hedges against investment securities. The remaining accretion on the loans was $ 1.7 million at December 31, 2025. During the year ended December 31, 2025, the Company entered into interest rate swap agreements designated as fair value hedges of interest rate rate risk associated with certain fixed-rate investment securities. The swaps are intended to hedge changes in fair value attributable to fluctuations in that benchmark rate. Changes to fair value hedges on mortgage-backed securities are recorded as gains or losses in interest income. The hedged items consist of mortgage-backed securities which are located in the 'Investment securities, available for sale' line item on the consolidated balance sheet. The hedge relationship fair value is recorded in the "other liabilities" line item on the consolidated balance sheet. The hedge relationships had stated maturities ranging from March 27, 2040 to March 27, 2042. The company assesses hedge effectiveness on a monthly basis using regression analysis, the fair value hedges are considered highly effective. Other Derivative Instruments From time to time, we may enter into certain interest rate swaps that are not designated as hedging instruments. These interest rate derivative contracts relate to transactions in which we enter into an interest rate swap with a customer while concurrently entering into an offsetting interest rate swap with a third-party financial institution. We agree to pay interest to the customer on a notional amount at a variable rate and receive interest from the customer on a similar notional amount at a fixed interest rate. At the same time, we agree to pay a third-party financial institution the same fixed interest rate on the same notional amount and receive the same variable interest rate on the same notional amount. These interest rate derivative contracts allow our customers to effectively convert a variable rate loan to a fixed rate loan. The Company enters into non–hedging derivatives in the form of mortgage loan forward sale commitments with investors and commitments to originate mortgage loans as part of its mortgage banking business. At December 31, 2025, the Company’s fair value of these derivatives were recorded and over the next 12 months are not expected to have a significant impact on the Company’s net income. Changes in fair value of both the forward sale commitments and commitments to originate mortgage loans were recorded and the net gains or losses included in the Company’s gain on sale of loans. 123 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following tables summarize the fair value of our derivative financial instruments utilized by the Company on a gross basis for the periods indicated. Asset Derivatives Liability Derivatives December 31, 2025 December 31, 2025 Notional Amount Fair Value Notional Amount Fair Value Derivatives designated as hedging instruments Interest rate contracts - fair value hedges $ 121,542 $ 307 $ — Total derivatives designated as hedging instruments 121,542 307 — Derivatives not designated as hedging instruments Interest rate contracts -customer accommodation 460,276 13,658 460,276 13,658 Mortgage loan contracts — — 11,254 14 Commitments to originate mortgage loans 3,644 94 — — Total derivatives not designated as hedging instruments 463,920 13,752 471,530 13,672 Total derivatives 585,462 14,059 471,530 13,672 Total derivatives subject to enforceable master netting arrangements, gross 585,462 14,059 471,530 13,672 Less: Gross amounts offset — — — — Total derivatives subject to enforceable master netting arrangements, net $ 585,462 $ 14,059 $ 471,530 $ 13,672 Asset Derivatives Liability Derivatives December 31, 2024 December 31, 2024 Notional Amount Fair Value Notional Amount Fair Value Derivatives designated as hedging instruments Interest rate contracts - fair value hedges $ — $ — $ — $ — Total derivatives designated as hedging instruments — — — — Derivatives not designated as hedging instruments Interest rate contracts - customer accommodation 521,520 28,817 521,520 28,817 Mortgage loan contracts 6,155 27 — — Commitments to originate mortgage loans 6,856 202 — — Total derivatives not designated as hedging instruments 534,531 29,046 521,520 28,817 Total derivatives 534,531 29,046 521,520 28,817 Total derivatives subject to enforceable master netting arrangements, gross 534,531 29,046 521,520 28,817 Less: Gross amounts offset — — — — Total derivatives subject to enforceable master netting arrangements, net $ 534,531 $ 29,046 $ 521,520 $ 28,817 While the Company is party to master netting arrangements with most of its swap derivative counterparties, the Company has elected to not offset derivative assets and liabilities under these agreements on its consolidated balance sheets. Collateral exchanged between the Company and dealer bank counterparties is generally subject to thresholds and transfer minimums, and usually consists of marketable securities. At December 31, 2025, the Company did not pledge any marketable securities as collateral. 124 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The effect of the derivative and the hedged item in fair value hedging relationships on the consolidated statements of income for the year-ended December 31 is as follows: Location of gain (loss) recognized on derivative and Hedge item Amount of Gain (Loss) Recognized on Derivative and Hedged Item Years Ended December 31 2025 2024 2023 Derivatives designated as hedging instruments Interest rate contracts - fair value hedge Interest income - loans receivable $ — $ 1,166 $ 1,169 Hedged item — ( 1,166 ) ( 1,169 ) Interest rate contracts - fair value hedge Interest income - investment securities 332 ( 220 ) 240 Hedged item ( 307 ) 220 ( 240 ) Total $ 25 $ — $ — The effect of derivatives not designated as hedging instruments on the consolidated statements of income for the year-ended December 31 is as follows: Location of gain (loss) recognized on derivative Amount of Gain (Loss) Recognized on Derivative Years Ended December 31 2025 2024 2023 Derivative not designated as hedging relationship Mortgage loan contracts Non-interest income-gain (loss) on sale of loans $ ( 42 ) $ 68 $ 83 Commitments to originate mortgage loans Non-interest income-gain (loss) on sale of loans ( 108 ) ( 67 ) ( 159 ) Total $ ( 150 ) $ 1 $ ( 76 ) The following tables summarize the carrying amount and associated cumulative basis adjustment related to the application of hedge accounting that is included in the carrying amount of hedged assets and liabilities in fair value hedging relationships. Amortized Cost of Hedged Items Cumulative Amount of Fair Value Hedging Adjustments Included in the Carrying Amount of the Hedged Items December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024 Available for Sale Debt Securities $ 122,442 $ — $ ( 307 ) $ — Note 22 – Disclosures about Fair Value of Assets and Liabilities The Fair Value Measurements topic of the FASB ASC defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. There are three levels of inputs that may be used to measure fair value: Level 1 – Quoted prices in active markets for identical assets or liabilities Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities 125 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Following is a description of the valuation methodologies used for instruments measured at fair value on a recurring basis and recognized in the accompanying consolidated financial statements, as well as the general classification of such instruments pursuant to the valuation hierarchy. There have been no significant changes in the valuation techniques during the period ended December 31, 2025. For assets classified within Level 3 of the fair value hierarchy, the process used to develop the reported fair value is described below. Available for sale securities When quoted market prices are available in an active market, securities are classified within Level 1 of the valuation hierarchy. If quoted market prices are not available, then fair values are estimated by using pricing models, quoted prices of securities with similar characteristics or discounted cash flows. Level 2 securities include U.S. Treasury and federal agency securities, state and municipal securities, US. government agency mortgage-backed securities, and mortgage–backed pools and corporate notes. Level 2 securities are valued by a third party pricing service commonly used in the banking industry utilizing observable inputs. Observable inputs include dealer quotes, market spreads, cash flow analysis, the U.S. Treasury yield curve, trade execution data, market consensus prepayment spreads and available credit information and the bond’s terms and conditions. The pricing provider utilizes evaluated pricing models that vary based on asset class. These models incorporate available market information including quoted prices of securities with similar characteristics and, because many fixed–income securities do not trade on a daily basis, apply available information through processes such as benchmark curves, benchmarking of like securities, sector grouping, and matrix pricing. In addition, model processes, such as an option adjusted spread model, is used to develop prepayment and interest rate scenarios for securities with prepayment features. Level 3 securities use the discounted cash flow model or other market indicators to calculate the fair values. Equity securities in other assets The fair value of the Company's equity investments in other assets is estimated by a third party utilizing readily determinable fair values quoted on an active market. These investments include the Company's non-qualified deferred compensation plan (see Note 14 - Non-Qualified Deferred Compensation Plan). The Company informally funded its obligation to plan participants in a rabbi trust, which is consolidated by the Company, and is comprised of investment options similar to those selected by the Participants. The assets held in the rabbi trust were reported at their estimated fair value and were included in cash and other assets in the Company's consolidated balance sheets. The related accrued benefit cost (representing the Company's benefit obligation to participants) is recorded as an offsetting liability in other liabilities in the Company's consolidated balance sheets. These assets are classified within Level 1 of the valuation hierarchy. Interest rate swap agreements The fair value of the Company’s interest rate swap agreements is estimated by a third party using inputs that are primarily unobservable including a yield curve, adjusted for liquidity and credit risk, contracted terms and discounted cash flow analysis, and therefore, are classified within Level 2 of the valuation hierarchy. Commitments to originate mortgage loans and mortgage loan contract assets/liabilities The Company’s forward commitments are valued based on quoted prices for similar assets in an active market with inputs that are observable. 126 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following table presents the fair value measurements of assets and liabilities recognized in the accompanying financial statements measured at fair value on a recurring basis and the level within the FASB ASC fair value hierarchy in which the fair value measurements fall at the following: December 31, 2025 Carrying Amount Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Available for sale securities U.S. Treasury and federal agencies 16,905 — 16,905 — State and municipal 319,665 — 319,665 — U.S. government agency mortgage-backed securities 494,174 — 494,174 — Corporate notes 44,670 — 40,799 3,871 Total available for sale securities 875,414 — 871,543 3,871 Equity securities in other assets 7,871 7,871 — — Held for trading securities 3,883 — 3,883 — Interest rate swap agreements asset 13,965 — 13,965 — Commitments to originate mortgage loans 94 — 94 — Liabilities Mortgage loans contracts ( 14 ) — ( 14 ) — Interest rate swap agreements liability ( 13,658 ) — ( 13,658 ) — December 31, 2024 Carrying Amount Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Available for sale securities U.S. Treasury and federal agencies $ 1,801 $ — $ 1,801 $ — State and municipal 201,834 — 201,834 — U.S. government agency mortgage-backed securities 14,543 — 14,543 — Corporate notes 15,499 — 15,499 — Total available for sale securities 233,677 — 233,677 — Equity securities 595 595 — — Interest rate swap agreements asset 28,817 — 28,817 — Commitments to originate mortgage loans 202 — 202 — Mortgage loan contracts 27 — 27 — Liabilities: Interest rate swap agreements liability ( 28,817 ) — ( 28,817 ) — 127 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Level 3 recurring fair value measurements: The following tables present the changes in fair value for assets classified within Level 3 of the fair value hierarchy. During 2025, the Company recorded its only Level 3 fair value measurement, an available‑for‑sale corporate debt security, which was transferred from Level 2 to Level 3 due to increased reliance on significant unobservable inputs used in the discounted cash flow model. At the time of transfer, the security had an amortized cost of $ 5 million and the Company recognized an initial allowance for credit losses $ 150 thousand and an initial write down of $ 2.1 million; the fair value at the transfer date is reflected within "Transfers into Level 3". Subsequent changes during the year included an adjustment to the allowance for credit losses of $ 30 thousand (reflecting the decrease in the allowance for credit losses to $ 120 thousand). These valuation inputs primarily relate to expected cash flow timing, credit assumptions, and the discount rate applied to those cash flows: Year Ended December 31 Level 3 instruments at fair value 2025 Fair value beginning of year — Transfers into Level 3 (at fair value on transfer date) $ 2,787 Total gains/losses included in earnings (subsequent ACL change - AFS securities) 30 Total gains/losses included in OCI 1,054 Ending balance – December 31, 2025 $ 3,871 Certain other assets are measured at fair value on a non-recurring basis in the ordinary course of business and are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment): Carrying Amount Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) December 31, 2025 Collateral dependent loans $ 7,429 $ — $ — $ 7,429 December 31, 2024 Collateral dependent loans $ 3,797 $ — $ — $ 3,797 Collateral Dependent Loans: For loans identified as collateral dependent, then the fair value method of measuring the amount of impairment is utilized. This method requires obtaining a current independent appraisal of the collateral and applying a discount factor to the value. 128 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following table presents qualitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements, other than goodwill, at December 31, 2025 and 2024. December 31, 2025 Carrying Amount Valuation Technique Unobservable Inputs Range (Weighted Average) Collateral dependent loans $ 7,429 Collateral based measurement Discount to reflect current market conditions and ultimate collectability 34.2 %– 67.4 % ( 30.6 %) December 31, 2024 Carrying Amount Valuation Technique Unobservable Inputs Range (Weighted Average) Collateral dependent loans $ 3,797 Collateral based measurement Discount to reflect current market conditions and ultimate collectability 16.1 %– 40.1 % ( 36.6 %) Note 23 – Fair Value of Financial Instruments The estimated fair value amounts of the Company’s financial instruments were determined using available market information, current pricing information applicable to Horizon and various valuation methodologies. Where market quotations were not available, considerable management judgment was involved in the determination of estimated fair values. Therefore, the estimated fair value of financial instruments shown below may not be representative of the amounts at which they could be exchanged in a current or future transaction. Due to the inherent uncertainties of expected cash flows of financial instruments, the use of alternate valuation assumptions and methods could have a significant effect on the estimated fair value amounts. The following table does not include certain financial instruments that are recorded at fair value on a recurring basis, including some non-recurring financial instruments. See Note 22 for more details. The estimated fair values of financial instruments, as shown below, are not intended to reflect the estimated liquidation or market value of Horizon taken as a whole. The disclosed fair value estimates are limited to Horizon’s significant financial instruments at December 31, 2025 and December 31, 2024. These include financial instruments recognized as assets and liabilities on the consolidated balance sheet as well as certain off–balance sheet financial instruments. The estimated fair values shown below do not include any valuation of assets and liabilities which are not financial instruments as defined by the FASB ASC fair value hierarchy. The following methods and assumptions were used to estimate the fair value of each class of financial instrument: Cash and Cash Equivalents – Cash and cash equivalents are composed of: cash and due from banks, interest-bearing deposits in banks, and federal funds sold. The carrying amounts approximate fair value. Interest-Earning Time Deposits – The carrying amounts approximate fair value. Held-to-Maturity Securities — For debt securities held to maturity, fair values are based on quoted market prices or dealer quotes. For those securities where a quoted market price is not available, carrying amount is a reasonable estimate of fair value based upon comparison with similar securities. Loans Held for Sale — For mortgage loans, the fair value is derived from third party pricing models, based on active quotes. For non-mortgage loans, the assets are carried at the lower of cost or fair value. Net Loans — The fair value of net loans are estimated on an exit price basis incorporating discounts for credit, liquidity and marketability factors. FHLB Stock — Fair value of FHLB stock is based on the price at which it may be resold to the FHLB Interest Receivable/Payable — The carrying amounts approximate fair value. 129 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Deposits — The fair value of demand deposits, savings accounts, interest bearing checking accounts and money market deposits is the amount payable on demand at the reporting date and are classified within Level 1. The fair value of fixed maturity certificates of deposit is estimated by discounting the future cash flows using rates currently offered for deposits of similar remaining maturity and are classified within Level 2. Borrowings — Rates currently available to Horizon for debt with similar terms and remaining maturities are used to estimate fair values of existing borrowings. Subordinated Notes — The fair value of subordinated notes is based on discounted cash flows based on current borrowing rates for similar types of instruments. Junior Subordinated Debentures to Capital Trusts — Rates currently available for debentures with similar terms and remaining maturities are used to estimate fair values of existing debentures. 130 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) The following tables present estimated fair values of the Company’s financial instruments and the level within the fair value hierarchy in which the fair value measurements fall. December 31, 2025 Carrying Amount Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets Cash and due from banks $ 66,813 $ 66,813 $ — $ — Interest- bearing deposits in banks 72,646 72,646 — — Federal funds sold — — — — Cash and cash equivalents 139,459 139,459 — — Interest earning time deposits — — — — Investment securities, held to maturity — — — — Loans held for sale 9,778 — 9,778 — Loans, net 4,825,243 — — 4,695,231 Stock in FHLB 45,713 — 45,713 — Interest receivable 29,733 — 29,733 — Liabilities Non-interest bearing deposits $ 1,078,708 $ 1,078,708 $ — $ — Interest bearing deposits 4,196,709 3,094,231 1,100,237 — Borrowings 248,586 — 248,580 — Subordinated notes 98,215 — 98,835 — Junior subordinated debentures issued to capital trusts 57,688 — 51,468 — Interest payable 12,892 — 12,892 — 131 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) December 31, 2024 Carrying Amount Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets Cash and due from banks $ 92,300 $ 92,300 $ — $ — Interest-earning deposits 201,131 201,131 — — Federal funds sold — — — — Cash and cash equivalents 293,431 293,431 — — Interest earnings time deposits 735 — 735 — Investment securities, held to maturity 1,867,690 — 1,566,268 — Loans held for sale 67,597 — 64,824 2,773 Loans (excluding loan level hedges), net 4,795,060 — — 4,611,702 Stock in FHLB 53,826 — 53,826 — Liabilities Non-interest bearing deposits $ 1,064,818 $ 1,064,818 $ — $ — Interest bearing deposits 4,535,834 3,446,680 1,084,986 — Borrowings 1,232,252 — 1,230,860 — Subordinated notes 55,738 — 55,284 — Junior subordinated debentures issued to capital trusts 57,477 — 48,559 — Interest payable 11,137 — 11,137 — Note 24 – General Litigation From time to time, Horizon and its subsidiaries are involved in various legal proceedings incidental to the conduct of their business. Management does not expect that the outcome of any such proceedings will have a material adverse effect on our consolidated financial position or results of operations. The specific litigation referenced in the 2024 Form 10-K have been resolved in 2025. 132 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Note 25 – Condensed Financial Information (Parent Company Only) Presented below is condensed financial information as to financial position, results of operations and cash flows of Horizon Bancorp, Inc.: Condensed Balance Sheets December 31 2025 December 31 2024 Assets Total cash and cash equivalents $ 81,246 $ 86,938 Investment in subsidiaries 770,811 803,799 Other assets 17,254 9,806 Total assets $ 869,311 $ 900,543 Liabilities Subordinated notes $ 98,215 $ 55,738 Junior subordinated debentures issued to capital trusts 57,688 57,477 Other liabilities 25,157 23,748 Stockholders’ Equity 688,251 763,580 Total liabilities and stockholders’ equity $ 869,311 $ 900,543 Condensed Statements of Income Years Ended December 31 2025 2024 2023 Income: Dividend income from subsidiaries $ 40,000 $ 38,000 $ 55,500 Other income 343 117 431 Total Income: $ 40,343 $ 38,117 $ 55,931 Expenses: Interest expense 9,653 7,906 8,226 Salaries and employee benefit expense 2,101 5,351 3,502 Other expense 1,190 434 370 Total expenses: $ 12,944 $ 13,691 $ 12,098 Income Before Undistributed Income of Subsidiaries $ 27,399 $ 24,426 $ 43,833 Undistributed Income (loss) of Subsidiaries ( 181,244 ) 8,198 ( 17,838 ) Income (Loss) Before Tax $ ( 153,845 ) $ 32,624 $ 25,995 Income Tax Benefit 3,363 2,805 1,986 Net Income (Loss) Available to Common Shareholders $ ( 150,482 ) $ 35,429 $ 27,981 133 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Condensed Statements of Comprehensive Income (Loss) Years Ended December 31 2025 2024 2023 Net Income (Loss) $ ( 150,482 ) $ 35,429 $ 27,981 Other Comprehensive Income (Loss) Change in fair value of derivative instruments Change in fair value of derivative instruments for the period — — ( 523 ) Reclassification adjustment for swap termination gain realized in income — — ( 1,453 ) Income tax effect — — 415 Changes from derivative instruments — — ( 1,561 ) Change in securities: Unrealized gain (loss) for the period on available for sale securities ( 284,181 ) ( 120 ) 20,728 Amortization (accretion) from transfer of securities from available for sale to held to maturity securities ( 2,395 ) ( 657 ) ( 691 ) Reclassification adjustment for securities (gains) losses realized in income 299,538 39,140 32,052 Income tax effect ( 2,657 ) ( 8,055 ) ( 10,939 ) Unrealized gains (losses) on securities 10,305 30,308 41,150 Other Comprehensive Income (Loss), Net of Tax 10,305 30,308 39,589 Comprehensive Income (Loss) $ ( 140,177 ) $ 65,737 $ 67,570 134 Table of Contents HORIZON BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Table dollars in thousands except for per share data) Condensed Statements of Cash Flows Years Ended December 31 2025 2024 2023 Operating Activities Net income (loss) $ ( 150,482 ) $ 35,429 $ 27,981 Items not requiring (providing) cash Equity in undistributed net income of subsidiaries 181,244 ( 8,198 ) 17,838 Change in: Share based compensation 1,621 4,586 3,586 Other assets ( 8,026 ) ( 4,621 ) 7,184 Other liabilities 1,236 3,717 ( 413 ) Net cash provided by operating activities 25,593 30,913 56,176 Investing Activities Capital contribution to subsidiary ( 138,108 ) — — Other investing activities 735 1,829 1,762 Net cash provided by (used in) investing activities ( 137,373 ) 1,829 1,762 Net cash used in investing activities Other change in borrowings — — 378 Dividends paid on common shares ( 29,488 ) ( 28,328 ) ( 28,311 ) Net settlement of share awards ( 4,089 ) ( 1,371 ) ( 1,221 ) Proceeds from issuance of stock 97,950 — — Net proceeds from issuance of subordinated notes 98,215 — — Repayment of subordinated notes ( 56,500 ) — ( 3,132 ) Other — 4,146 — Net cash provided by (used in) financing activities 106,088 ( 25,553 ) ( 32,286 ) Net Change in Cash and Cash Equivalents ( 5,692 ) 7,189 25,652 Cash and Cash Equivalents at Beginning of Year 86,938 79,749 54,097 Cash and Cash Equivalents at End of Year $ 81,246 $ 86,938 $ 79,749 Note 26 - Segment Reporting Horizon Bancorp has one reportable segment. Business activities are managed on a consolidated basis and revenues are derived primarily through commercial banking, offering retail banking and private wealth management from North America. Horizon Bancorp’s chief operating decision maker (“CODM”) is the Chief Executive Officer. The CODM assesses performance and allocates resources based on consolidated net income, as reported on the Consolidated Statement of Income , and the same accounting policies are applied as described in the Note 1 - Nature of Operations and Su mmary of Significant Accounting Policies . The CODM uses net income to evaluate income generated from segment assets in deciding whether to reinvest profits into the business or distribute dividends to shareholders. The CODM also uses net income in competitive analysis by benchmarking against Horizon Bancorp’s competitors. The competitive analysis, along with the monitoring of budgeted versus actual results, is used in assessing performance of the segment and in establishing management’s compensation. 135 Table of Contents Report of Independent Registered Public Accounting Firm Audit Committee, Board of Directors, and Shareholders Horizon Bancorp, Inc. Michigan City, Indiana Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of Horizon Bancorp, Inc. (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income (loss), stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework: (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 13, 2026, expressed an unqualified opinion thereon. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Allowance for Credit Losses (“ACL”) As described in Note 5 to the consolidated financial statements, the Company’s allowance for credit losses (“ACL”) was approximately $51.3 million at December 31, 2025. The Company utilized the Cumulative Loss Rate method in determining expected future credit losses. The loss rate method measures the amount of loan charge–offs, net of recoveries, (“loan losses”) recognized over the life of a closed pool and compares those loan losses to the 136 Table of Contents outstanding loan balance of that pool as of a specific point in time (“pool date”). The credit loss factors applied are determined based on the weighted average of externally developed macroeconomic scenarios that take into consideration the Company’s economic outlook as derived through forecast macroeconomic variables. Management utilized economic forecast scenarios including both National and Regional econometrics, as well as management judgment, as the basis for the forecast period. We identified the economic forecast adjustment element of the quantitative component of the ACL as a critical audit matter. The principal considerations for our determination included the significant judgment and estimation by management in the determination of reasonable and supportable forecasts of macroeconomic variables. The primary procedures we performed to address this critical audit matter included: • We obtained an understanding of the Company’s process for establishing the ACL, including the economic forecast adjustment. • Evaluated the design and tested the operating effectiveness of key controls over the completeness and accuracy of economic factor inputs into the model, and the significant judgments applied in the application of economic forecast adjustments. • Assessed management’s process for developing the economic forecasting adjustments and determining the reasonableness of the forecasting adjustments applied in the ACL estimate which included: ◦ Evaluating managements reasonable and supportable weighting of economic forecast scenarios, using evidence from internal and external sources. ◦ Evaluating whether the macroeconomic variables selected by management to determine economic forecasts are correlated to historical net charge-offs of the Company. • Evaluated the mathematical accuracy of the economic forecast adjustments applied in the ACL estimate. • Evaluated the reasonableness of the overall ACL and related economic forecasting adjustments to determine whether the ACL appropriately reflects expected credit losses by assessing trends in relevant factors and evaluating the relationship of those trends to the overall ACL and related economic forecast adjustments applied to the ACL. /s/ Forvis Mazars, LLP We have served as the Company’s auditor since 1998. Indianapolis, Indiana March 13, 2026 137 Table of Contents Report of Independent Registered Public Accounting Firm Audit Committee, Board of Directors, and Shareholders Horizon Bancorp, Inc. Michigan City, Indiana Opinion on the Internal Control Over Financial Reporting We have audited Horizon Bancorp, Inc.’s (the “Company”) internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework: (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework: (2013) issued by COSO. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated financial statements of the Company as of December 31, 2025 and 2024, and for each of the three years in the period ended December 31, 2025, and our report dated March 13, 2026 expressed an unqualified opinion on those financial statements. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management Report on Internal Control over Financial Reporting . Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definitions and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of reliable financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate. /s/ Forvis Mazars, LLP Indianapolis, Indiana March 13, 2026 138 Table of Contents HORIZON BANCORP, INC. MANAGEMENT’S REPORT ON FINANCIAL STATEMENTS Management is responsible for the preparation and presentation of the consolidated financial statements and related notes on the preceding pages. The statements have been prepared in conformity with accounting principles generally accepted in the United States of America appropriate in the circumstances and include amounts that are based on management’s best estimates and judgments. Financial information elsewhere in the Annual Report is consistent with that in the consolidated financial statements. In meeting its responsibility for the accuracy of the consolidated financial statements, management relies on Horizon’s system of internal accounting controls. This system is designed to provide reasonable assurance that assets are safeguarded and transactions are properly recorded to permit the preparation of appropriate financial information. The system of internal controls is supplemented by a program of internal audits to independently evaluate the adequacy and application of financial and operating controls and compliance with Company policies and procedures. The Audit Committee of the Board of Directors meets periodically with management, the independent accountants and the internal auditors to ensure that each is properly discharging its responsibilities with regard to the consolidated financial statements and internal accounting controls. The independent accountants have full and free access to the Audit Committee and meet with it to discuss auditing and financial reporting matters. The consolidated financial statements in the Annual Report have been audited by Forvis Mazars, LLP, an independent registered public accounting firm, for 2025, 2024 and 2023. Their audits were conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States) and included consideration of internal accounting controls, tests of accounting records and other audit procedures to the extent necessary to allow them to express their opinion on the fairness of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America. 139 Table of Contents HORIZON BANCORP, INC. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None