What changed in this filing

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Item 1. Financial Statements

2025-11-10 compared with 2025-08-06 · 229 added, 221 removed, 1286 unchanged (26% of the section changed)

3 unchanged sentences

(Amounts in thousands except share data)

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Cash and due from banks $ 10,923 $ 9,249

46 unchanged sentences

First Internet Bancorp

Condensed Consolidated Statements of Income – Unaudited

Condensed Consolidated Statements of Operations – Unaudited

(Amounts in thousands except share and per share data)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

13 unchanged sentences

Provision (benefit) for credit losses - off-balance sheet commitments 396 ( 439 ) 252 ( 398 )

Net Interest Income After Provision for Credit Losses 14,382 17,296 27,545 35,582

Noninterest Income

Net Interest (Loss) Income After Provision for Credit Losses ( 4,437 ) 18,375 23,108 53,957

Noninterest (Loss) Income

Service charges and fees 369 245 912 711

1 unchanged sentence

Loan servicing asset revaluation ( 1,332 ) ( 846 ) ( 3,666 ) ( 2,109 )

Gain on sale of loans 1,673 8,292 10,320 14,828

(Loss) gain on sale of loans ( 27,103 ) 9,933 ( 16,783 ) 24,761

Other 1,364 1,127 4,857 3,683

Total noninterest income 5,557 11,033 15,984 19,380

Total noninterest (loss) income ( 24,647 ) 12,029 ( 8,663 ) 31,409

Noninterest Expense

10 unchanged sentences

Income Tax (Benefit) Provision ( 12,950 ) 620 ( 15,914 ) 1,267

Net Income $ 193 $ 5,775 $ 1,136 $ 10,956

Income Per Share of Common Stock

Net (Loss) Income $ ( 41,593 ) $ 6,990 $ ( 40,457 ) $ 17,946

(Loss) Income Per Share of Common Stock

Basic $ ( 4.76 ) $ 0.80 $ ( 4.63 ) $ 2.07

6 unchanged sentences

First Internet Bancorp

Condensed Consolidated Statements of Comprehensive Income – Unaudited

Condensed Consolidated Statements of Comprehensive (Loss) Income – Unaudited

(Amounts in thousands)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

Net income $ 193 $ 5,775 $ 1,136 $ 10,956

Net (loss) income $ ( 41,593 ) $ 6,990 $ ( 40,457 ) $ 17,946

Other comprehensive income

Securities available-for-sale

Net unrealized holding gains (losses) recorded within other comprehensive income (loss) before income tax 3,236 ( 551 ) 7,660 ( 2,625 )

Income tax provision (benefit) 744 ( 126 ) 1,761 ( 601 )

Net effect on other comprehensive income (loss) 2,492 ( 425 ) 5,899 ( 2,024 )

Net unrealized holding gains recorded within other comprehensive income before income tax 4,454 10,620 12,114 7,995

Income tax provision 1,027 2,442 2,788 1,841

Net effect on other comprehensive income 3,427 8,178 9,326 6,154

Securities held-to-maturity

3 unchanged sentences

Cash flow hedges

Net unrealized holding gains (losses) on cash flow hedging derivatives recorded within other comprehensive income (loss) before income tax — ( 262 ) — 640

Income tax (benefit) provision — ( 60 ) — 147

Net effect on other comprehensive (loss) income — ( 202 ) — 493

Total other comprehensive income (loss) 2,590 ( 485 ) 6,086 ( 1,212 )

Comprehensive income $ 2,783 $ 5,290 $ 7,222 $ 9,744

Net unrealized holding losses on cash flow hedging derivatives recorded within other comprehensive loss before income tax — ( 2,670 ) — ( 2,030 )

Income tax benefit — ( 614 ) — ( 467 )

Net effect on other comprehensive income — ( 2,056 ) — ( 1,563 )

Total other comprehensive income 3,563 6,261 9,649 5,049

Comprehensive (loss) income $ ( 38,030 ) $ 13,251 $ ( 30,808 ) $ 22,995

See Notes to Condensed Consolidated Financial Statements

1 unchanged sentence

Condensed Consolidated Statements of Changes in Shareholders’ Equity - Unaudited

Six Months Ended June 30, 2025 and 2024

Nine Months Ended September 30, 2025 and 2024

(Amounts in thousands except share and per share data)

4 unchanged sentences

Balance, January 1, 2025 $ 186,094 $ 230,622 $ ( 32,653 ) $ 384,063

Net income — 1,136 — 1,136

Net loss — ( 40,457 ) — ( 40,457 )

Other comprehensive income — — 9,649 9,649

4 unchanged sentences

Common stock redeemed for the net settlement of share-based awards ( 224 ) — — ( 224 )

Balance, June 30, 2025 $ 186,116 $ 230,690 $ ( 26,567 ) $ 390,239

Balance, September 30, 2025 $ 186,608 $ 188,564 $ ( 23,004 ) $ 352,168

Balance, January 1, 2024 $ 184,700 $ 207,470 $ ( 29,375 ) $ 362,795

Net income — 17,946 — 17,946

Other comprehensive loss — — ( 1,212 ) ( 1,212 )

Other comprehensive income — — 5,049 5,049

Dividends declared ($ 0.18 per share)

1 unchanged sentence

Recognition of the fair value of share-based compensation 1,356 — — 1,356

Repurchased shares of common stock ( 10,500 )

Repurchased shares of common stock ( 10,500 shares)

( 283 ) — — ( 283 )

2 unchanged sentences

Common stock redeemed for the net settlement of share-based awards ( 142 ) — — ( 142 )

Balance, June 30, 2024 $ 185,175 $ 217,365 $ ( 30,587 ) $ 371,953

Balance, September 30, 2024 $ 185,631 $ 223,824 $ ( 24,326 ) $ 385,129

See Notes to Condensed Consolidated Financial Statements

1 unchanged sentence

Condensed Consolidated Statements of Changes in Shareholders’ Equity - Unaudited

Three Months Ended June 30, 2025 and 2024

Three Months Ended September 30, 2025 and 2024

(Amounts in thousands except share and per share data)

3 unchanged sentences

Shareholders’

Balance, April 1, 2025 185,873 $ 231,031 $ ( 29,157 ) $ 387,747

Net income — 193 — 193

Balance, July 1, 2025 186,116 $ 230,690 $ ( 26,567 ) $ 390,239

Net loss — ( 41,593 ) — ( 41,593 )

Other comprehensive income — — 3,563 3,563

3 unchanged sentences

Deferred stock rights and restricted stock units issued in lieu of cash dividends payable on outstanding deferred stock rights and restricted stock units 2 — — 2

Balance, June 30, 2025 $ 186,116 $ 230,690 $ ( 26,567 ) $ 390,239

Balance, April 1, 2024 $ 184,720 $ 212,121 $ ( 30,102 ) $ 366,739

Balance, September 30, 2025 $ 186,608 $ 188,564 $ ( 23,004 ) $ 352,168

Balance, July 1, 2024 $ 185,175 $ 217,365 $ ( 30,587 ) $ 371,953

Net income — 6,990 — 6,990

Other comprehensive loss — — ( 485 ) ( 485 )

Other comprehensive income — — 6,261 6,261

Dividends declared ($ 0.06 per share)

1 unchanged sentence

Recognition of the fair value of share-based compensation 454 — — 454

Excise tax on repurchase of common stock ( 3 ) — — ( 3 )

Balance, June 30, 2024 $ 185,175 $ 217,365 $ ( 30,587 ) $ 371,953

Deferred stock rights and restricted stock units issued in lieu of cash dividends payable on outstanding deferred stock rights and restricted stock units 2 — — 2

Balance, September 30, 2024 $ 185,631 $ 223,824 $ ( 24,326 ) $ 385,129

See Notes to Condensed Consolidated Financial Statements

2 unchanged sentences

(Amounts in thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

Operating Activities

Net income $ 1,136 $ 10,956

Adjustments to reconcile net income to net cash (used in) provided by operating activities:

Net (loss) income $ ( 40,457 ) $ 17,946

Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:

Depreciation and amortization 5,230 6,030

4 unchanged sentences

Proceeds from sale of loans 381,503 374,561

Gain on loans sold ( 10,320 ) ( 14,828 )

Loss (gain) on loans sold 16,783 ( 24,761 )

Gain on sale of other real estate owned ( 19 ) ( 31 )

(Loss) gain on derivatives ( 146 ) 1,803

(Gain) loss on derivatives ( 106 ) 768

Gain on bank-owned life insurance — ( 149 )

13 unchanged sentences

Loans purchased ( 47,674 ) ( 81,605 )

Net proceeds from sale of portfolio loans 799,297 —

Other investing activities ( 9,214 ) ( 11,857 )

Net cash used in investing activities ( 296,498 ) ( 193,391 )

Net cash provided by (used in) investing activities 406,615 ( 341,287 )

Financing Activities

Net increase in deposits 365,583 206,949

Net (decrease) increase in deposits ( 17,772 ) 730,737

Cash dividends paid ( 1,571 ) ( 1,580 )

3 unchanged sentences

Other, net ( 247 ) ( 153 )

Net cash provided by financing activities 333,796 165,463

Net Decrease in Cash and Cash Equivalents ( 20,049 ) ( 9,112 )

Net cash (used in) provided by financing activities ( 65,090 ) 628,721

Net Increase in Cash and Cash Equivalents 321,251 306,581

Cash and Cash Equivalents, Beginning of Period 466,410 405,898

4 unchanged sentences

Loans transferred to other real estate owned 2,058 251

Loans transferred to held-for-sale from portfolio 863,766 —

Cash dividends declared, paid in subsequent period 523 520

9 unchanged sentences

In our opinion, all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation have been included.

The results of operations for the three and six months ended June 30, 2025 are not necessarily indicative of the results expected for the year ending December 31, 2025 or any other period.

The June 30, 2025 condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the First Internet Bancorp Annual Report on Form 10-K for the year ended December 31, 2024.

The results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of the results expected for the year ending December 31, 2025 or any other period.

The September 30, 2025 condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the First Internet Bancorp Annual Report on Form 10-K for the year ended December 31, 2024.

The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates, judgments, or assumptions that could have a material effect on the carrying value of certain assets and liabilities.

5 unchanged sentences

It is the opinion of management that the disposition or ultimate resolution of such claims and lawsuits will not have a material adverse effect on the consolidated financial position, results of operations, and cash flows of the Company.

Earnings Per Share

Earnings per share of common stock are based on the weighted-average number of basic shares and dilutive shares outstanding during the period.

The following is a reconciliation of the weighted-average common shares for the basic and diluted earnings per share computations for the three and six months ended June 30, 2025 and 2024.

(dollars in thousands, except share and per share data) Three Months Ended June 30, Six Months Ended June 30,

(Loss) Earnings Per Share

(Loss) earnings per share of common stock are based on the weighted-average number of basic shares and dilutive shares outstanding during the period.

The following is a reconciliation of the weighted-average common shares for the basic and diluted (loss) earnings per share computations for the three and nine months ended September 30, 2025 and 2024.

(dollars in thousands, except share and per share data) Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

Basic earnings per share

Net income $ 193 $ 5,775 $ 1,136 $ 10,956

Net (loss) income $ ( 41,593 ) $ 6,990 $ ( 40,457 ) $ 17,946

Weighted-average common shares 8,742,052 8,696,634 8,730,519 8,688,304

Basic earnings per common share $ 0.02 $ 0.67 $ 0.13 $ 1.26

Basic (loss) earnings per common share $ ( 4.76 ) $ 0.80 $ ( 4.63 ) $ 2.07

Diluted earnings per share

Net income $ 193 $ 5,775 $ 1,136 $ 10,956

Net (loss) income $ ( 41,593 ) $ 6,990 $ ( 40,457 ) $ 17,946

Weighted-average common shares 8,742,052 8,696,634 8,730,519 8,688,304

1 unchanged sentence

Weighted-average common and incremental shares 8,742,052 8,768,731 8,730,519 8,756,544

Diluted earnings per common share 1

Diluted (loss) earnings per common share 1

$ ( 4.76 ) $ 0.80 $ ( 4.63 ) $ 2.05

1 Potential dilutive common shares are excluded from the computation of diluted EPS in the periods where the effect would be antidilutive.

Excluded from the computation of diluted EPS were weighted-average antidilutive shares totaling 15,940 and 9,006 for the three and six months ended June 30, 2025, respectively.

There were no antidilutive shares for both the three and six months ended June 30, 2024.

The following tables summarize securities available-for-sale and securities held-to-maturity as of June 30, 2025 and December 31, 2024.

June 30, 2025

Since the Company was in a loss position for the three and nine months ended September 30, 2025, basic net loss is the same as diluted net loss per share, as the inclusion of all potential shares of common stock outstanding would have been anti-dilutive.

There were no antidilutive shares for both the three and nine months ended September 30, 2024.

The following tables summarize securities available-for-sale and securities held-to-maturity as of September 30, 2025 and December 31, 2024.

September 30, 2025

Amortized Cost Gross Unrealized Fair Value

10 unchanged sentences

Total available-for-sale $ 653,291 $ 1,797 $ ( 29,182 ) $ 625,906

June 30, 2025

September 30, 2025

Amortized Cost Gross Unrealized Fair Value Allowance for Credit Losses Net Carrying Value

6 unchanged sentences

Total held-to-maturity $ 261,847 $ 1,219 $ ( 14,619 ) $ 248,447 $ ( 122 ) $ 261,725

1 Includes $ 0.2 million of additional premium related to terminated interest rate swaps associated with agency mortgage-backed securities - residential as of June 30, 2025.

1 Includes $ 0.2 million of additional premium related to terminated interest rate swaps associated with agency mortgage-backed securities - residential as of September 30, 2025.

December 31, 2024

22 unchanged sentences

1 Includes $ 0.3 million of additional premium related to terminated interest rate swaps associated with agency mortgage-backed securities - residential as of December 31, 2024.

Accrued interest receivable on AFS and HTM securities at June 30, 2025 was $ 2.7 million and $ 1.2 million, respectively, compared to $ 2.8 million and $ 1.1 million, respectively, at December 31, 2024, and is included in accrued interest receivable on the condensed consolidated balance sheet.

Accrued interest receivable on AFS and HTM securities at September 30, 2025 was $ 2.5 million and $ 1.0 million, respectively, compared to $ 2.8 million and $ 1.1 million, respectively, at December 31, 2024, and is included in accrued interest receivable on the condensed consolidated balance sheet.

The Company elected to exclude all accrued interest receivable from securities when estimating credit losses.

At June 30, 2025 and December 31, 2024, approximately 94 % and 92 %, respectively, of mortgage-backed securities (including both AFS and HTM) held by the Company are issued by U.S.

At September 30, 2025 and December 31, 2024, approximately 95 % and 92 %, respectively, of mortgage-backed securities (including both AFS and HTM) held by the Company are issued by U.S.

government-sponsored entities and agencies.

5 unchanged sentences

The Company also evaluated its HTM securities that are in an unrealized loss position and considered issuer bond ratings, historical loss rates for bond ratings and economic forecasts.

The ACL on HTM securities at June 30, 2025 was $ 0.1 million, compared to $ 0.2 million at December 31, 2024.

The carrying value of securities at June 30, 2025 is shown below by their contractual maturity date.

The ACL on HTM securities at September 30, 2025 was $ 0.1 million, compared to $ 0.2 million at December 31, 2024.

The carrying value of securities at September 30, 2025 is shown below by their contractual maturity date.

Actual maturities will differ because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

21 unchanged sentences

Total $ 261,847 $ 248,447

No available-for-sale securities were sold during the three and six months ended June 30, 2025 and June 30, 2024.

No available-for-sale securities were sold during the three and nine months ended September 30, 2025 and September 30, 2024.

As such, the Company did not realize any gains or losses related to the sale of available-for-sale securities during either time period.

Certain investments in debt securities are reported in the condensed consolidated financial statements at an amount less than their historical cost.

The total fair value of these investments at June 30, 2025 and December 31, 2024 was $ 645.8 million and $ 603.9 million, which was approximately 70 % and 72 %, respectively, of the Company’s AFS and HTM securities portfolios.

As of June 30, 2025, the Company’s security portfolio consisted of 599 positions, of which 466 were in an unrealized loss position.

The total fair value of these investments at September 30, 2025 and December 31, 2024 was $ 589.1 million and $ 603.9 million, which was approximately 66 % and 72 %, respectively, of the Company’s AFS and HTM securities portfolios.

As of September 30, 2025, the Company’s security portfolio consisted of 593 positions, of which 421 were in an unrealized loss position.

As of December 31, 2024, the Company’s security portfolio consisted of 579 positions, of which 482 were in an unrealized loss position.

9 unchanged sentences

The Company does not intend to sell the investments, and it is not more likely than not that the Company will be required to sell the investments, before recovery of their amortized cost basis, which may be upon maturity.

The following tables show the securities portfolio’s gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at June 30, 2025 and December 31, 2024.

June 30, 2025

September 30, 2025

Less Than 12 Months 12 Months or Longer Total

29 unchanged sentences

Total $ 100,802 $ ( 444 ) $ 298,536 $ ( 40,597 ) $ 399,338 $ ( 41,041 )

The following tables summarize ratings for the Company’s HTM portfolio as of June 30, 2025 and December 31, 2024.

June 30, 2025

The following tables summarize ratings for the Company’s HTM portfolio as of September 30, 2025 and December 31, 2024.

September 30, 2025

Held-to-Maturity

23 unchanged sentences

Total $ 12,846 $ 201,840 $ 5,705 $ 29,559 $ 249,950

There were no amounts reclassified from accumulated other comprehensive loss to the consolidated statements of income during the three and six months ended June 30, 2025 and 2024.

Loan balances as of June 30, 2025 and December 31, 2024 are summarized in the table below.

There were no amounts reclassified from accumulated other comprehensive loss to the condensed consolidated statements of operations during the three and nine months ended September 30, 2025 and 2024.

Loan balances as of September 30, 2025 and December 31, 2024 are summarized in the table below.

Categories of loans include:

(amounts in thousands) June 30, 2025 December 31, 2024

(amounts in thousands) September 30, 2025 December 31, 2024

Commercial loans

22 unchanged sentences

1 Balances include $ 43.5 million and $ 34.0 million that is guaranteed by the U.S.

government as of June 30, 2025 and December 31, 2024, respectively.

2 Includes carrying value adjustment of $ 21.2 million and $ 22.9 million related to terminated interest rate swaps associated with public finance loans as of June 30, 2025 and December 31, 2024, respectively.

government as of September 30, 2025 and December 31, 2024, respectively.

2 Includes carrying value adjustment of $ 20.2 million and $ 22.9 million related to terminated interest rate swaps associated with public finance loans as of September 30, 2025 and December 31, 2024, respectively.

During the nine months ended September 30, 2025, the Company sold $ 836.9 million of single tenant lease financing loans.

Subsequent to September 30, 2025, the Company sold an additional $ 14.3 million of single tenant lease financing loans.

The general risk characteristics specific to each loan portfolio segment are as follows:

116 unchanged sentences

A home improvement loan generally is charged off no later than when it is 90 days past due as to principal or interest.

The following tables present changes in the balance of the ACL during the three and six months ended June 30, 2025 and 2024.

(amounts in thousands) Three Months Ended June 30, 2025

The following tables present changes in the balance of the ACL during the three and nine months ended September 30, 2025 and 2024.

(amounts in thousands) Three Months Ended September 30, 2025

Allowance for credit losses:

Balance, Beginning of Period Provision (Credit) Charged to Expense Losses

Balance, Beginning of Period (Credit) Provision Charged to Expense Losses

Charged Off Recoveries Balance,

13 unchanged sentences

Total $ 46,517 $ 34,393 $ ( 21,752 ) $ 765 $ 59,923

(amounts in thousands) Six Months Ended June 30, 2025

(amounts in thousands) Nine Months Ended September 30, 2025

Allowance for credit losses:

15 unchanged sentences

Total $ 44,769 $ 60,110 $ ( 46,041 ) $ 1,085 $ 59,923

(amounts in thousands) Three Months Ended June 30, 2024

(amounts in thousands) Three Months Ended September 30, 2024

Allowance for credit losses:

15 unchanged sentences

Total $ 43,405 $ 3,858 $ ( 1,751 ) $ 209 $ 45,721

(amounts in thousands) Six Months Ended June 30, 2024

(amounts in thousands) Nine Months Ended September 30, 2024

Allowance for credit losses:

15 unchanged sentences

Total $ 38,774 $ 10,360 $ ( 3,789 ) $ 376 $ 45,721

Accrued interest receivable on loans totaled $ 26.4 million and $ 28.2 million at June 30, 2025 and December 31, 2024, respectively, and is excluded from the estimate of credit losses.

Accrued interest receivable on loans totaled $ 21.6 million and $ 28.2 million at September 30, 2025 and December 31, 2024, respectively, and is excluded from the estimate of credit losses.

The Company made the accounting policy election to not measure an ACL for accrued interest receivable.

3 unchanged sentences

The adequacy of the reserve for unfunded commitments is determined quarterly based on methodology similar to the methodology for determining the ACL.

The following tables detail activity in the provision (benefit) for credit losses on off-balance sheet commitments for the three and six months ended June 30, 2025.

The following tables detail activity in the (benefit) provision for credit losses on off-balance sheet commitments for the three and nine months ended September 30, 2025.

(amounts in thousands) Balance

March 31, 2025 Provision (Benefit) for Credit Losses Balance

June 30, 2025

June 30, 2025 (Benefit) Provision for Credit Losses Balance

September 30, 2025

Off-balance sheet commitments

14 unchanged sentences

December 31, 2024 (Benefit) Provision for Credit Losses Balance

June 30, 2025

September 30, 2025

Off-balance sheet commitments

13 unchanged sentences

Total allowance for off-balance sheet commitments $ 2,140 $ 252 $ 2,392

The following table details activity in the (benefit) provision for credit losses on off-balance sheet commitments for the three and six months ended June 30, 2024.

The following table details activity in the (benefit) provision for credit losses on off-balance sheet commitments for the three and nine months ended September 30, 2024.

(amounts in thousands) Balance

March 31, 2024 (Benefit) Provision for Credit Losses Balance

June 30, 2024

June 30, 2024 Provision (Benefit) for Credit Losses Balance

September 30, 2024

Off-balance sheet commitments

1 unchanged sentence

Commercial and industrial $ 188 $ 24 $ 212

Owner-occupied commercial real estate — 24 24

Investor commercial real estate — 10 10

Construction 3,420 ( 556 ) 2,864

Single tenant lease financing — 28 28

Small business lending 131 31 162

8 unchanged sentences

December 31, 2023 (Benefit) Provision for Credit Losses Balance

June 30, 2024

September 30, 2024

Off-balance sheet commitments

4 unchanged sentences

Construction 2,889 ( 25 ) 2,864

Single tenant lease financing — 28 28

Small business lending 541 ( 379 ) 162

22 unchanged sentences

• “Nonperforming” - Loans that are 90 days delinquent or for which the full collection of principal and interest may be in doubt.

The following tables present the credit risk profile of the Company’s commercial and consumer loan portfolios by loan class and by year of origination for the years indicated based on rating category and payment activity as of June 30, 2025 and December 31, 2024.

June 30, 2025

September 30, 2025

Term Loans (amortized cost basis by origination year) Revolving loans amortized cost basis Revolving loans converted to term

45 unchanged sentences

Year-to-date gross charge-offs — — — — — — — — —

June 30, 2025

September 30, 2025

Term Loans (amortized cost basis by origination year) Revolving loans amortized cost basis Revolving loans converted to term

128 unchanged sentences

Total year-to-date gross charge-offs $ 1,250 $ 6,013 $ 3,439 $ 1,047 $ 620 $ 901 $ — $ — $ 13,270

The following tables present the Company’s loan portfolio delinquency, including nonperforming loans, as of June 30, 2025 and December 31, 2024.

June 30, 2025

The following tables present the Company’s loan portfolio delinquency, including nonperforming loans, as of September 30, 2025 and December 31, 2024.

September 30, 2025

(amounts in thousands) 30-59

41 unchanged sentences

The following table summarizes the Company’s nonaccrual loans and loans past due 90 days or more and still accruing by loan class for the periods indicated:

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(amounts in thousands) Nonaccrual Loans Nonaccrual Loans with No Allowance for Credit Losses Total Loans

1 unchanged sentence

Commercial and industrial $ 264 $ — $ — $ — $ — $ —

Public finance 1,665 — — — — —

Single tenant lease financing 1,665 — — — — —

Healthcare finance 1,460 1,460 — — — —

Small business lending 13,524 12,639 877 11,429 4,778 1,320

3 unchanged sentences

Total loans $ 52,373 $ 20,037 $ 877 $ 25,955 $ 8,922 $ 2,466

Interest income recognized on nonaccrual loans was $ 0.1 million and $ 0.2 million for the three and six months ended June 30, 2025, respectively, and less than $ 0.1 million for the three and six months ended June 30, 2024, respectively.

Interest income recognized on nonaccrual loans was $ 0.1 million and $ 1.1 million for the three and nine months ended September 30, 2025, respectively, and less than $ 0.1 million for both the three and nine months ended September 30, 2024.

Determining fair value for collateral dependent loans requires obtaining a current independent appraisal of the collateral and applying a discount factor, which includes selling costs if applicable, to the value.

4 unchanged sentences

Both appraised values and values based on borrower’s financial information are discounted as considered appropriate based on age and quality of the information and current market conditions.

The following tables present the amortized cost basis of collateral dependent loans, which are individually evaluated to determine expected credit losses as of June 30, 2025 and December 31, 2024.

June 30, 2025

The following tables present the amortized cost basis of collateral dependent loans, which are individually evaluated to determine expected credit losses as of September 30, 2025 and December 31, 2024.

September 30, 2025

(amounts in thousands) Commercial Real Estate Residential Real Estate Other (Includes Equipment, Machinery and Other Assets) Total Allowance on Collateral Dependent Loans

19 unchanged sentences

These modifications may include interest rate reductions, principal or interest forgiveness, other-than-insignificant payment delays, term extensions and other actions intended to minimize loss and to avoid foreclosure or repossession of collateral.

The Company had six loan modifications made to borrowers experiencing financial difficulty during the three months ended June 30, 2025.

The Company had eight loan modifications made to borrowers experiencing financial difficulty during the six months ended June 30, 2025.

The Company did no t have any loan modifications made to borrowers experiencing financial difficulty during the three and six months ended June 30, 2024.

The following table presents loans that were both experiencing financial difficulty and modified during the three months ended June 30, 2025.

Three Months Ended June 30, 2025

The Company had one loan modification made to borrowers experiencing financial difficulty during the three months ended September 30, 2025.

The Company had ten loan modifications made to borrowers experiencing financial difficulty during the nine months ended September 30, 2025.

The Company had three loan modifications made to borrowers experiencing financial difficulty during the three and nine months ended September 30, 2024.

The following tables present loans that were both experiencing financial difficulty and modified during the three months ended September 30, 2025 and September 30, 2024.

Three Months Ended September 30, 2025

(dollars in thousands) Payment Delay Total Modification by Loan Class % of Class of Loans

Commercial and industrial $ 393 $ 393 0.3 %

Single tenant lease financing 3,007 3,007 0.3 %

Small business lending 3,084 3,084 0.6 %

Franchise finance $ 562 $ 562 0.1 %

Total $ 562 $ 562

The following table presents loans that were both experiencing financial difficulty and modified during the six months ended June 30, 2025.

Six Months Ended June 30, 2025

Three Months Ended September 30, 2024

(dollars in thousands) Payment Delay Total Modification by Loan Class % of Class of Loans

Investor commercial real estate $ 3,731 $ 3,731 1.4 %

Franchise finance 4,028 4,028 0.7 %

Total $ 7,759 $ 7,759

The following tables present loans that were both experiencing financial difficulty and modified during the nine months ended September 30, 2025 and September 30, 2025.

Nine Months Ended September 30, 2025

(dollars in thousands) Payment Delay Total Modification by Loan Class % of Class of Loans

Commercial and industrial $ 386 $ 386 0.2 %

2 unchanged sentences

Small business lending 3,013 3,013 0.8 %

Franchise finance 562 562 0.1 %

Total $ 11,243 $ 11,243

Nine Months Ended September 30, 2024

(dollars in thousands) Payment Delay Total Modification by Loan Class % of Class of Loans

Investor commercial real estate $ 3,731 $ 3,731 1.4 %

Franchise finance 4,028 4,028 0.7 %

Total $ 7,759 $ 7,759

The Company closely monitors the performance of loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts.

The following table presents the performance of loans that were modified within the twelve months ended June 30, 2025.

Twelve Months Ended June 30, 2025

The following table presents the performance of loans that were modified within the twelve months ended September 30, 2025.

Twelve Months Ended September 30, 2025

(amounts in thousands) Current 30 - 89 Days

1 unchanged sentence

Commercial and industrial $ 386 $ — $ —

Investor commercial real estate 3,731 — —

Single tenant lease financing 3,007 — 1,665

3 unchanged sentences

Total $ 8,118 $ 2,616 $ 1,665

There were two modified loans totaling $ 4.0 million with payment defaults during three and six months ended June 30, 2025.

The payment defaults did not have a material impact on the allowance for credit losses on loans.

There were no modified loans with payment defaults during the three and six months ended June 30, 2024.

There was one loan totaling $ 1.7 million that was modified within the twelve months ended September 30, 2025 that subsequently defaulted during the period presented.

Other Real Estate Owned

The Company had $ 1.7 million in other real estate owned (“OREO”) as of June 30, 2025, which consisted of two small business lending properties and one residential mortgage property.

The Company had $ 1.8 million in other real estate owned (“OREO”) as of September 30, 2025, which consisted of two small business lending properties.

The Company had $ 0.3 million in OREO as of December 31, 2024, which consisted of one residential mortgage property.

There were seven loans totaling $ 2.3 million and nine loans totaling $ 2.1 million, in the process of foreclosure at June 30, 2025 and December 31, 2024, respectively.

There were seven loans totaling $ 2.4 million and nine loans totaling $ 2.1 million, in the process of foreclosure at September 30, 2025 and December 31, 2024, respectively.

Premises and Equipment

The following table summarizes premises and equipment at June 30, 2025 and December 31, 2024.

(amounts in thousands) June 30, 2025 December 31, 2024

The following table summarizes premises and equipment at September 30, 2025 and December 31, 2024.

(amounts in thousands) September 30, 2025 December 31, 2024

Land $ 5,598 $ 5,598

5 unchanged sentences

Total $ 68,843 $ 71,453

As of June 30, 2025 and December 31, 2024, the carrying amount of goodwill was $ 4.7 million.

There have been no changes in the carrying amount of goodwill for the three months ended June 30, 2025 or June 30, 2024.

As of September 30, 2025 and December 31, 2024, the carrying amount of goodwill was $ 4.7 million.

There have been no changes in the carrying amount of goodwill for the three months ended September 30, 2025 or September 30, 2024.

Goodwill is assessed for impairment annually as of August 31, or more frequently if events occur or circumstances change that indicate an impairment may exist.

2 unchanged sentences

Alternatively, a quantitative goodwill test can be performed without performing a qualitative assessment.

Goodwill was assessed for impairment using a qualitative test performed as of August 31, 2024.

Goodwill was assessed for impairment using a quantitative test performed as of August 31, 2025.

The estimated fair value of the reporting unit exceeded the net carrying value, and therefore no goodwill impairment existed as of that date.

2 unchanged sentences

Servicing Asset

Activity for the servicing asset and the related changes in fair value for the three and six months ended June 30, 2025 and 2024 are shown in the table below.

Activity for the servicing asset and the related changes in fair value for the three and nine months ended September 30, 2025 and 2024 are shown in the table below.

Three Months Ended

(amounts in thousands) June 30, 2025 June 30, 2024

(amounts in thousands) September 30, 2025 September 30, 2024

Balance, beginning of period $ 16,736 $ 13,009

Originated 444 2,078

Subtractions:

4 unchanged sentences

Balance, end of period $ 22,107 $ 14,662

Six Months Ended

(amounts in thousands) June 30, 2025 June 30, 2024

1 Balance includes $ 3.8 million of originated servicing asset related to the sale of single tenant lease financing loans that was completed during the three months ended September 30, 2025.

Nine Months Ended

(amounts in thousands) September 30, 2025 September 30, 2024

Balance, beginning of period 16,389 10,567

Originated 2,681 3,705

Subtractions:

2 unchanged sentences

the valuation model

( 952 ) ( 12 )

Loan servicing asset revaluation $ ( 3,666 ) $ ( 2,109 )

Balance, end of period $ 22,107 $ 14,662

1 Balance includes $ 3.8 million of originated servicing asset related to the sale of single tenant lease financing loans that was completed during the nine months ended September 30, 2025.

Loans serviced for others are not included in the condensed consolidated balance sheets.

The unpaid principal balances of these loans serviced for others as of June 30, 2025 and December 31, 2024 are shown in the table below.

(amounts in thousands) June 30, 2025 December 31, 2024

The unpaid principal balances of these loans serviced for others as of September 30, 2025 and December 31, 2024 are shown in the table below.

(amounts in thousands) September 30, 2025 December 31, 2024

Loan portfolios serviced for:

SBA guaranteed loans $ 1,047,698 $ 862,089

Single tenant lease financing 835,325 —

Total $ 1,883,023 $ 862,089

Loan servicing revenue totaled $ 2.0 million and $ 4.0 million for the three and six months ended June 30, 2025, respectively, and $ 1.5 million and $ 2.8 million for the three and six months ended June 30, 2024, respectively.

Loan servicing asset revaluation, which represents the change in fair value of the servicing asset, resulted in a $ 1.2 million and $ 2.3 million downward valuation for the three and six months ended June 30, 2025 and a $ 0.8 million and $ 1.3 million downward valuation for both the three and six months ended June 30, 2024, respectively.

Loan servicing revenue totaled $ 2.1 million and $ 6.0 million for the three and nine months ended September 30, 2025, respectively, and $ 1.6 million and $ 4.4 million for the three and nine months ended September 30, 2024, respectively.

Loan servicing asset revaluation, which represents the change in fair value of the servicing asset, resulted in a $ 1.3 million and $ 3.7 million downward valuation for the three and nine months ended September 30, 2025, respectively, and a $ 0.8 million and $ 2.1 million downward valuation for the three and nine months ended September 30, 2024, respectively.

The fair value of servicing rights is highly sensitive to changes in underlying assumptions.

25 unchanged sentences

Holders of $ 0.7 million of unregistered 2031 Notes did not participate in the exchange.

The following table presents the principal balance and unamortized discount and debt issuance costs for the 2029 Notes, the 2030 Note, and the 2031 Notes as of June 30, 2025 and December 31, 2024.

June 30, 2025 December 31, 2024

The following table presents the principal balance and unamortized discount and debt issuance costs for the 2029 Notes, the 2030 Note, and the 2031 Notes as of September 30, 2025 and December 31, 2024.

September 30, 2025 December 31, 2024

(amounts in thousands) Principal Unamortized Discount and Debt Issuance Costs Principal Unamortized Discount and Debt Issuance Costs

16 unchanged sentences

Award Activity Under 2022 Plan

The Company recorded $ 0.5 million o f share-based compensation expense for both the three and six months ended June 30, 2025, related to stock-based awards under the 2022 Plan.

The Company recorded $ 0.4 million and $ 0.7 million o f share-based compensation expense for the three and six months ended June 30, 2024, respectively, related to stock-based awards under the 2022 Plan.

The following table summarizes the stock-based award activity under the 2022 Plan for the six months ended June 30, 2025.

The Company recorded $ 0.5 million and $ 0.9 million o f share-based compensation expense for the three and nine months ended September 30, 2025, respectively, related to stock-based awards under the 2022 Plan.

The Company recorded $ 0.4 million and $ 1.1 million o f share-based compensation expense for the three and nine months ended September 30, 2024, respectively, related to stock-based awards under the 2022 Plan.

The following table summarizes the stock-based award activity under the 2022 Plan for the nine months ended September 30, 2025.

(dollars in thousands, except per share data) Restricted Stock Units Weighted-Average Grant Date Fair Value Per Share Restricted Stock Awards Weighted-Average Grant Date Fair Value Per Share Deferred Stock Units Weighted-Average Grant Date Fair Value Per Share

2 unchanged sentences

Vested ( 28,192 ) 24.32 ( 12,040 ) 31.46 — —

Unvested at June 30, 2025 157,504 $ 27.97 16,009 $ 24.72 — $ —

At June 30, 2025, the total unrecognized compensation cost related to unvested stock-based awards under the 2022 Plan was $ 3.2 million with a weighted-average expense recognition period of 1.9 years.

Unvested at September 30, 2025 157,504 $ 27.97 16,009 $ 24.72 — $ —

At September 30, 2025, the total unrecognized compensation cost related to unvested stock-based awards under the 2022 Plan was $ 2.7 million with a weighted-average expense recognition period of 1.7 years.

2013 Equity Incentive Plan

2 unchanged sentences

Award Activity Under 2013 Plan

The Company recorded no share-based compensation expense for the three months ended June 30, 2025, and less than $ 0.1 million of share-based compensation expense for the six months ended June 30, 2025, related to stock-based awards under the 2013 Plan .

The Company recorded $ 0.1 million and $ 0.2 million of share-based compensation expense for the three and six months ended June 30, 2024, respectively, related to stock-based awards under the 2013 Plan .

The following table summarizes the stock-based award activity under the 2013 Plan for the six months ended June 30, 2025.

The Company recorded no share-based compensation expense for the three months ended September 30, 2025, and less than $ 0.1 million of share-based compensation expense for the nine months ended September 30, 2025, related to stock-based awards under the 2013 Plan .

The Company recorded $ 0.1 million and $ 0.2 million of share-based compensation expense for the three and nine months ended September 30, 2024, respectively, related to stock-based awards under the 2013 Plan .

The following table summarizes the stock-based award activity under the 2013 Plan for the nine months ended September 30, 2025.

2 unchanged sentences

Vested ( 7,871 ) 46.71 — — — —

Unvested at June 30, 2025 — $ — — $ — — $ —

At June 30, 2025, there were no unrecognized compensation costs related to unvested stock-based awards under the 2013 Plan.

Unvested at September 30, 2025 — $ — — $ — — $ —

At September 30, 2025, there were no unrecognized compensation costs related to unvested stock-based awards under the 2013 Plan.

Directors Deferred Stock Plan

3 unchanged sentences

Deferred stock rights were to be settled in common stock following the end of the deferral period payable on the basis of one share of common stock for each deferred stock right.

The following table summarizes the status of deferred stock rights related to the Directors Deferred Stock Plan for the six months ended June 30, 2025.

The following table summarizes the status of deferred stock rights related to the Directors Deferred Stock Plan for the nine months ended September 30, 2025.

Deferred Stock Rights

4 unchanged sentences

In the normal course of business, the Company makes various commitments to extend credit which are not reflected in the accompanying condensed consolidated financial statements.

At June 30, 2025 and December 31, 2024, the Company had outstanding loan commitments totaling approximately $ 584.5 million and $ 667.7 million, respectively.

At September 30, 2025 and December 31, 2024, the Company had outstanding loan commitments totaling approximately $ 594.8 million and $ 667.7 million, respectively.

Fair Value of Financial Instruments

11 unchanged sentences

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.

The Company did not own any securities classified within Level 1 of the hierarchy as of June 30, 2025 and December 31, 2024.

The Company did not own any securities classified within Level 1 of the hierarchy as of September 30, 2025 and December 31, 2024.

Level 2 securities include U.S.

5 unchanged sentences

Rating agency and industry research reports as well as default and deferral activity are reviewed and incorporated into the calculation.

The Company did not own any securities classified within Level 3 of the hierarchy as of June 30, 2025 or December 31, 2024.

The Company did not own any securities classified within Level 3 of the hierarchy as of September 30, 2025 or December 31, 2024.

Servicing Asset

10 unchanged sentences

The fair value assets and liabilities of centrally cleared interest rate swaps are net of variation margin settled-to-market (Level 2).

The following tables present the fair value measurements of assets and liabilities recognized in the accompanying condensed consolidated balance sheets measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall at June 30, 2025 and December 31, 2024.

June 30, 2025

September 30, 2025

Fair Value Measurements Using

35 unchanged sentences

Interest rate swap agreements - liabilities (back-to-back) ( 200 ) — ( 200 ) —

The following tables reconcile the beginning and ending balances of recurring fair value measurements recognized in the accompanying condensed consolidated balance sheets using significant unobservable (Level 3) inputs for the three and six months ended June 30, 2025 and 2024.

Three Months Ended

(amounts in thousands) Servicing Asset

Balance as of April 1, 2025 $ 17,445

Total realized gains

Originated 444

Subtractions:

Paydowns ( 847 )

Change in fair value ( 306 )

Balance, June 30, 2025 $ 16,736

Balance as of April 1, 2024 $ 11,760

Total realized gains

Originated 2,078

Subtractions:

Paydowns ( 797 )

Change in fair value ( 32 )

Balance, June 30, 2024 $ 13,009

Six Months Ended

(amounts in thousands) Servicing Asset

Balance, January 1, 2025 $ 16,389

(amounts in thousands) September 30, 2025 September 30, 2024

Balance, beginning of period $ 16,736 $ 13,009

Total realized gains

Originated 2,681

Subtractions:

1 unchanged sentence

Change in fair value ( 429 ) ( 157 )

Balance, June 30, 2025 $ 16,736

Balance, January 1, 2024 $ 10,567

Balance, end of period $ 22,107 $ 14,662

1 Balance includes $ 3.8 million of originated servicing asset related to the sale of single tenant lease financing loans that was completed during the three months ended September 30, 2025.

Nine Months Ended

(amounts in thousands) September 30, 2025 September 30, 2024

Balance, beginning of period $ 16,389 $ 10,567

Total realized gains

Originated 3,705

Subtractions:

1 unchanged sentence

Change in fair value ( 952 ) ( 12 )

Balance, June 30, 2024 $ 13,009

Balance, end of period $ 22,107 $ 14,662

1 Balance includes $ 3.8 million of originated servicing asset related to the sale of single tenant lease financing loans that was completed during the nine months ended September 30, 2025.

The following describes the valuation methodologies and inputs used for assets measured at fair value on a nonrecurring basis, as well as the general classification of such assets pursuant to the valuation hierarchy.

6 unchanged sentences

Individually analyzed loans with a specific valuation allowance based on the value of the underlying collateral or a discounted cash flow analysis are classified as Level 3 assets.

The following table presents the fair value measurements of assets and liabilities recognized in the accompanying condensed consolidated balance sheets measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurement falls at June 30, 2025 and December 31, 2024.

June 30, 2025

September 30, 2025

(amounts in thousands) Fair Value Measurements Using

3 unchanged sentences

Collateral dependent loans $ 337 $ — $ — $ 337

Other real estate owned 1,801 — — 1,801

December 31, 2024

7 unchanged sentences

(dollars in thousands) Fair Value at

June 30, 2025 Valuation

September 30, 2025 Valuation

Technique Significant Unobservable

3 unchanged sentences

Discount rate 0 % - 25 %

Other real estate owned 1,801 Fair value of collateral Discount to reflect current market conditions 30 % 30.0 %

(dollars in thousands) Fair Value at

10 unchanged sentences

Where quoted market prices are available in an active market, securities are classified within Level 1 of the valuation hierarchy.

Level 1 securities include highly liquid mutual funds.

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.

5 unchanged sentences

Rating agency and industry research reports as well as default and deferral activity are reviewed and incorporated into the calculation.

The Company did not own any securities classified within Level 3 of the hierarchy as of June 30, 2025 or December 31, 2024.

The Company did not own any securities classified within Level 3 of the hierarchy as of September 30, 2025 or December 31, 2024.

Loans Held-for-Sale

17 unchanged sentences

The fair value of commitments to extend credit are based on fees currently charged to enter into similar agreements with similar maturities and interest rates.

The Company determined that the fair value of commitments was zero based on the contractual value of outstanding commitments at each of June 30, 2025 and December 31, 2024.

The following tables present the carrying value and estimated fair value of all financial assets and liabilities that are not measured at fair value on a recurring basis at June 30, 2025 and December 31, 2024.

June 30, 2025

The Company determined that the fair value of commitments was zero based on the contractual value of outstanding commitments at each of September 30, 2025 and December 31, 2024.

The following tables present the carrying value and estimated fair value of all financial assets and liabilities that are not measured at fair value on a recurring basis at September 30, 2025 and December 31, 2024.

September 30, 2025

Fair Value Measurements Using

39 unchanged sentences

In December 2024, the Company terminated interest rate swaps utilized as cash flow hedges against Federal Home Loan Bank advances, which resulted in swap termination receipts from counterparties of $ 2.9 million.

As the Company had no further liability exposure to the underlying index hedged, the Company reclassified this amount from accumulated other comprehensive loss to the consolidated statements of income and recognized a gain on termination of interest rate swaps for the year ended December 31, 2024.

As the Company had no further liability exposure to the underlying index hedged, the Company reclassified this amount from accumulated other comprehensive loss to the consolidated statements of operations and recognized a gain on termination of interest rate swaps for the year ended December 31, 2024.

In November 2024, the Company’s interest rate swap derivative designated as fair value hedges matured.

2 unchanged sentences

The corresponding fair value hedging adjustment was allocated pro-rata to the underlying hedged securities and is being amortized over the remaining lives of the designated securities.

The Company had amortization expense totaling less than $ 0.1 million for both the three and six months ended June 30, 2025 and 2024, which was recognized as a reduction to interest income on securities.

The Company had amortization expense totaling less than $ 0.1 million for both the three and nine months ended September 30, 2025 and 2024, which was recognized as a reduction to interest income on securities.

In June 2020, the Company terminated all fair value hedging relationships associated with loans, which resulted in swap termination payments to counterparties totaling $ 46.1 million.

The corresponding loan fair value hedging adjustment as of the date of termination is being amortized over the remaining lives of the designated loans, which have a weighted average term to maturity of 9.2 years as of June 30, 2025.

The Company had amortization expense totaling $ 0.9 million and $ 1.7 million for the three and six months ended June 30, 2025, respectively, and $ 1.2 million and $ 2.2 million for the three and six months ended June 30, 2024, respectively, related to these previously terminated fair value hedges which was recognized as a reduction to interest income on loans.

The following table presents the notional amount and fair value of interest rate swaps utilized by the Company at June 30, 2025 and December 31, 2024.

June 30, 2025 December 31, 2024

The Company had amortization expense totaling $ 1.0 million and $ 2.7 million for the three and nine months ended September 30, 2025, respectively, and $ 1.6 million and $ 3.7 million for the three and nine months ended September 30, 2024, respectively, related to these previously terminated fair value hedges which was recognized as a reduction to interest income on loans.

The following table presents the notional amount and fair value of interest rate swaps utilized by the Company at September 30, 2025 and December 31, 2024.

September 30, 2025 December 31, 2024

(amounts in thousands) Notional

13 unchanged sentences

As a result of this offsetting relationship, no net gains or losses are recognized in income.

The Company received no cash collateral from counterparties as security for their obligations related to these swap transactions at June 30, 2025 and December 31, 2024.

As of June 30, 2025, the Company pledged cash collateral of $ 0.3 million to counterparties as security for its obligations related to these agreements.

The Company received no cash collateral from counterparties as security for their obligations related to these swap transactions at September 30, 2025 and December 31, 2024.

As of September 30, 2025, the Company pledged cash collateral of $ 0.3 million to counterparties as security for its obligations related to these agreements.

The Company had no pledged cash collateral as of December 31, 2024 to counterparties as security for its obligations related to these agreements.

Collateral posted and received is dependent on the market valuation of the underlying hedges.

The following table presents the effects of the Company’s cash flow hedge relationships on the condensed consolidated statements of comprehensive income during the three and six months ended June 30, 2025 and 2024.

Amount of Loss Recognized in Other Comprehensive Income for the Three Months Ended Amount of Gain Recognized in Other Comprehensive Income for the Six Months Ended

(amounts in thousands) June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2024

The following table presents the effects of the Company’s cash flow hedge relationships on the condensed consolidated statements of comprehensive income during the three and nine months ended September 30, 2025 and 2024.

Amount of Loss Recognized in Other Comprehensive Income for the Three Months Ended Amount of Loss Recognized in Other Comprehensive Income for the Nine Months Ended

(amounts in thousands) September 30, 2025 September 30, 2024 September 30, 2025 September 30, 2024

Interest rate swap agreements $ — $ ( 2,670 ) $ — $ ( 2,030 )

The Company had no changes in the fair value of derivatives not designated as hedging instruments on the condensed consolidated statements of income for the three and six months ended June 30, 2025 and 2024.

The following table presents the effects of the Company’s interest rate swap agreements on the condensed consolidated statements of operations during the three and six months ended June 30, 2025 and 2024.

(amounts in thousands) Three Months Ended Six Months Ended

Line Item in the Condensed Consolidated Statements of Income June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2024

The Company had no changes in the fair value of derivatives not designated as hedging instruments on the condensed consolidated statements of operations for the three and nine months ended September 30, 2025 and 2024.

The following table presents the effects of the Company’s interest rate swap agreements on the condensed consolidated statements of operations during the three and nine months ended September 30, 2025 and 2024.

(amounts in thousands) Three Months Ended Nine Months Ended

Line Item in the Condensed Consolidated Statements of Operations September 30, 2025 September 30, 2024 September 30, 2025 September 30, 2024

Interest income

1 unchanged sentence

Total interest income

— 421 — 1,250

Interest expense

6 unchanged sentences

Accumulated Other Comprehensive Loss

The components of accumulated other comprehensive loss, included in shareholders' equity, for the six months ended June 30, 2025 and 2024, respectively, are presented in the table below.

The components of accumulated other comprehensive loss, included in shareholders' equity, for the nine months ended September 30, 2025 and 2024, respectively, are presented in the table below.

(amounts in thousands) Unrealized Losses On Debt Securities Unrealized Losses On Debt Securities Transferred From Available-For-Sale To Held-To-Maturity Cash Flow Hedges Total

5 unchanged sentences

Other comprehensive income - net of tax 9,326 323 — 9,649

Balance, June 30, 2025 $ ( 24,514 ) $ ( 2,053 ) $ — $ ( 26,567 )

Balance, September 30, 2025 $ ( 21,087 ) $ ( 1,917 ) $ — $ ( 23,004 )

Balance, January 1, 2024 $ ( 30,174 ) $ ( 2,939 ) $ 3,738 $ ( 29,375 )

Other comprehensive (loss) income before reclassifications from accumulated other comprehensive loss before tax ( 2,625 ) — 640 ( 1,985 )

Other comprehensive income (loss) before reclassifications from accumulated other comprehensive loss before tax 7,995 — ( 2,030 ) 5,965

Reclassifications from accumulated other comprehensive loss to earnings before tax — 607 — 607

Other comprehensive (loss) gain before tax ( 2,625 ) 422 640 ( 1,563 )

Income tax (benefit) provision ( 601 ) 103 147 ( 351 )

Other comprehensive (loss) income - net of tax ( 2,024 ) 319 493 ( 1,212 )

Balance, June 30, 2024 $ ( 32,198 ) $ ( 2,620 ) $ 4,231 $ ( 30,587 )

The components of accumulated other comprehensive loss, included in stockholders' equity, for the three months ended June 30, 2025 and 2024, respectively, are presented in the table below.

Other comprehensive gain (loss) before tax 7,995 607 ( 2,030 ) 6,572

Income tax provision (benefit) 1,841 149 ( 467 ) 1,523

Other comprehensive gain (loss) - net of tax 6,154 458 ( 1,563 ) 5,049

Balance, September 30, 2024 $ ( 24,020 ) $ ( 2,481 ) $ 2,175 $ ( 24,326 )

The components of accumulated other comprehensive loss, included in stockholders' equity, for the three months ended September 30, 2025 and 2024, respectively, are presented in the table below.

(amounts in thousands) Unrealized Losses On Debt Securities Unrealized Losses On Debt Securities Transferred From Available-For-Sale To Held-To-Maturity Cash Flow Hedges Total

Balance, April 1, 2025 $ ( 27,006 ) $ ( 2,151 ) $ — $ ( 29,157 )

Balance, July 1, 2025 $ ( 24,514 ) $ ( 2,053 ) $ — ( 26,567 )

Other comprehensive income before reclassifications from accumulated other comprehensive loss before tax 4,454 — — 4,454

3 unchanged sentences

Other comprehensive income - net of tax 3,427 136 — 3,563

Balance, June 30, 2025 $ ( 24,514 ) $ ( 2,053 ) $ — $ ( 26,567 )

Balance, April 1, 2024 $ ( 31,773 ) $ ( 2,762 ) $ 4,433 ( 30,102 )

Other comprehensive (loss) before reclassifications from accumulated other comprehensive loss before tax ( 551 ) — ( 262 ) ( 813 )

Balance, September 30, 2025 $ ( 21,087 ) $ ( 1,917 ) $ — $ ( 23,004 )

Balance, July 1, 2024 $ ( 32,198 ) $ ( 2,620 ) $ 4,231 ( 30,587 )

Other comprehensive income (loss) before reclassifications from accumulated other comprehensive loss before tax 10,620 — ( 2,670 ) 7,950

Reclassifications from accumulated other comprehensive loss to earnings before tax — 185 — 185

Other comprehensive (loss) gain before tax ( 551 ) 188 ( 262 ) ( 625 )

Income tax (benefit) provision ( 126 ) 46 ( 60 ) ( 140 )

Other comprehensive (loss) income - net of tax ( 425 ) 142 ( 202 ) ( 485 )

Balance, June 30, 2024 $ ( 32,198 ) $ ( 2,620 ) $ 4,231 $ ( 30,587 )

Other comprehensive gain (loss) before tax 10,620 185 ( 2,670 ) 8,135

Income tax provision (benefit) 2,442 46 ( 614 ) 1,874

Other comprehensive income (loss) - net of tax 8,178 139 ( 2,056 ) 6,261

Balance, September 30, 2024 $ ( 24,020 ) $ ( 2,481 ) $ 2,175 $ ( 24,326 )

Amounts Reclassified from

Accumulated Other Comprehensive Loss for the Three Months Ended Amounts Reclassified from

Accumulated Other Comprehensive Loss for the Six Months Ended Affected Line Item in the

Accumulated Other Comprehensive Loss for the Nine Months Ended Affected Line Item in the

Statements of Operations

(amounts in thousands) June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2024

(amounts in thousands) September 30, 2025 September 30, 2024 September 30, 2025 September 30, 2024

Details About Accumulated Other Comprehensive Loss Components

Reclassifications from accumulated other comprehensive income to earnings before tax $ ( 132 ) ( 188 ) $ ( 252 ) $ ( 422 ) Interest income

Reclassifications from accumulated other comprehensive loss to earnings before tax $ ( 180 ) ( 185 ) $ ( 432 ) $ ( 607 ) Interest income

Total amount reclassified before tax ( 180 ) ( 185 ) ( 432 ) ( 607 ) (Loss) income before income taxes

17 unchanged sentences

The guidance is effective for annual periods beginning after December 15, 2024 with early adoption permitted.

The Company is currently evaluating the impact of this ASU on its condensed consolidated financial statements.

The Company believes the adoption of this guidance will not have a material impact on the condensed consolidated financial statements.

ASU 2024-03 - Income Statement-Reporting Comprehensive Income - Expense Disaggregations Disclosures (Subtopic 220-40):

3 unchanged sentences

Disaggregation of Income Statement Expenses.

The new standard requires disclosures about specific types of expenses included the income statement.

The new standard requires disclosures about specific types of expenses included in the income statement.

The guidance is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027.

The Company is currently evaluating the impact of this ASU on its consolidated financial statements.

2024 with early adoption permitted.

The Company is currently evaluating the impact of this ASU on its condensed consolidated financial statements.

Subsequent Event

On October 20, 2025, the Board of Directors of the Company authorized the repurchase of up to $ 25.0 million of the Company's outstanding common stock from time to time on the open market or in privately negotiated transactions.

The stock repurchase authorization is scheduled to expire on September 30, 2027.

The stock repurchase authorization may be modified, suspended, or discontinued at any time and does not commit the Company to repurchase shares of its common stock.

The actual number and value of the shares to be purchased, if any, will depend on the performance of the Company’s stock price and other market conditions.

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

What changed 10-Q

Item 1. Financial Statements