What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-05-06 compared with 2025-11-10 · 207 added, 391 removed, 888 unchanged (40% of the section changed)

Financial Statements.

INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)

1 unchanged sentence

Cash and demand deposits due from banks $ 23,896 $ 22,935

Fed Funds sold and interest bearing balances due from banks 129,177 1,712

Federal funds sold and interest bearing balances due from banks 26,209 3,106

Total cash and cash equivalents 50,105 26,041

AFS securities, at fair value 511,970 489,029

FHLB stock 5,600 12,762

Marketable securities AFS (amortized cost of $ 503,366 and $ 507,689 , respectively)

492,744 497,791

Mortgage loans HFS 360 423

Loans 1,431,905 1,423,571

Less allowance for credit losses 13,149 12,895

Net loans 1,418,756 1,410,676

Loans held for investment 1,558,941 1,536,364

Allowance for credit losses ( 14,014 ) ( 13,727 )

Loans, net 1,544,927 1,522,637

FHLB stock, at cost 5,600 5,600

Premises and equipment 29,064 29,000

4 unchanged sentences

LIABILITIES AND SHAREHOLDERS’ EQUITY

Demand deposits $ 421,027 $ 416,373

Noninterest bearing demand deposits $ 411,216 $ 426,342

Interest bearing demand deposits 263,954 266,187

6 unchanged sentences

Subordinated debt, net of unamortized issuance costs 29,537 29,514

Total borrowed funds 91,514 112,991

Other liabilities 15,083 15,884

2 unchanged sentences

Common stock — no par value, 15,000,000 shares authorized:

issued and outstanding 7,350,567 shares at September 30, 2025 and 7,424,893 shares at December 31, 2024

issued and outstanding 7,333,319 shares at March 31, 2026 and 7,322,207 shares at December 31, 2025

123,251 123,204

8 unchanged sentences

Three Months Ended

September 30 Nine Months Ended

2025 2024 2025 2024

Interest income

Loans $ 20,583 $ 20,230 $ 59,763 $ 57,150

Loans, including fees $ 21,464 $ 19,348

AFS securities

Taxable 2,489 2,103

Nontaxable 499 540

FHLB stock 75 160

8 unchanged sentences

Net interest income 16,882 14,525

Provision (reversal) for credit losses 209 946 ( 997 ) 1,508

Provision for (reversal of) credit losses 604 ( 107 )

Net interest income after provision for credit losses 16,278 14,632

2 unchanged sentences

Wealth management fees 1,108 979

Earnings on BOLI 468 252 1,140 748

Increase in the cash surrender value of BOLI 448 372

Net gain on sale of mortgage loans 33 30

8 unchanged sentences

FDIC insurance premiums 306 303

Other losses 47 347 501 908

Other 1,509 1,357

11 unchanged sentences

Three Months Ended

September 30 Nine Months Ended

2025 2024 2025 2024

Net income $ 4,992 $ 3,949

Unrealized gains on AFS securities 5,030 13,081 13,923 10,858

Unrealized gains (losses) on AFS securities ( 724 ) 5,014

Tax effect (1)

145 ( 1,098 )

Unrealized gains on AFS securities, net of tax 3,978 10,357 10,946 8,617

Unrealized gains (losses) on AFS securities, net of tax ( 579 ) 3,916

Comprehensive income $ 4,413 $ 7,865

9 unchanged sentences

Income (Loss) Totals

June 30, 2024 7,474,016 $ 126,126 $ 3,951 $ 99,808 $ ( 27,636 ) $ 202,249

Comprehensive income (loss) — — — 3,281 10,357 13,638

Issuance of common stock 17,580 350 — — — 350

Common stock transferred from the Rabbi Trust to satisfy deferred compensation obligations — 23 ( 23 ) — — —

Share-based payment awards under the Directors Plan — — 53 — — 53

Share-based compensation expense recognized in earnings under the RSP — 26 — — — 26

Common stock purchased for deferred compensation obligations — ( 290 ) — — — ( 290 )

Common stock repurchased ( 52,876 ) ( 1,017 ) — — — ( 1,017 )

Cash dividends paid ($ 0.28 per common share)

— — — ( 2,024 ) — ( 2,024 )

September 30, 2024 7,438,720 $ 125,218 $ 3,981 $ 101,065 $ ( 17,279 ) $ 212,985

June 30, 2025 7,361,684 $ 124,607 $ 2,331 $ 107,949 $ ( 14,387 ) $ 220,500

Comprehensive income (loss) — — — 5,240 3,978 9,218

Issuance of common stock 7,979 272 — — — 272

Common stock transferred from the Rabbi Trust to satisfy deferred compensation obligations — ( 10 ) 10 — — —

Share-based payment awards under the Directors Plan — — 32 — — 32

Share-based compensation expense recognized in earnings under the RSP — 24 — — — 24

Common stock repurchased ( 19,096 ) ( 609 ) — — — ( 609 )

Cash dividends paid ($ 0.28 per common share)

— — — ( 2,017 ) — ( 2,017 )

September 30, 2025 7,350,567 $ 124,284 $ 2,373 $ 111,172 $ ( 10,409 ) $ 227,420

Common Shares

Outstanding Amount Common Shares to be

Obligations Retained

Earnings Accumulated

Comprehensive

Income (Loss) Totals

December 31, 2024 7,424,893 $ 126,224 $ 2,383 $ 103,024 $ ( 21,355 ) $ 210,276

5 unchanged sentences

Share-based compensation expense recognized in earnings under the RSP — 7 — — — 7

Common stock purchased for deferred compensation obligations — ( 991 ) — — — ( 991 )

Common stock repurchased ( 45,582 ) ( 1,145 ) — — — ( 1,145 )

1 unchanged sentence

— — — ( 2,033 ) — ( 2,033 )

September 30, 2024 7,438,720 $ 125,218 $ 3,981 $ 101,065 $ ( 17,279 ) $ 212,985

March 31, 2025 7,408,010 $ 125,547 $ 2,508 $ 104,940 $ ( 17,439 ) $ 215,556

December 31, 2025 7,322,207 $ 123,204 $ 2,366 $ 113,849 $ ( 8,023 ) $ 231,396

2 unchanged sentences

Common stock issued for deferred compensation under the RSP 9,492 — — — — —

Common stock transferred from the Rabbi Trust to satisfy deferred compensation obligations — 243 ( 243 ) — — —

Share-based payment awards under the Directors Plan — — 156 — — 156

3 unchanged sentences

— — — ( 2,051 ) — ( 2,051 )

September 30, 2025 7,350,567 $ 124,284 $ 2,373 $ 111,172 $ ( 10,409 ) $ 227,420

March 31, 2026 7,333,319 $ 123,251 $ 2,522 $ 116,790 $ ( 8,602 ) $ 233,961

See notes to interim condensed consolidated financial statements (unaudited).

1 unchanged sentence

(Dollars in thousands)

Nine Months Ended

Three Months Ended

Operating activities

1 unchanged sentence

Reconciliation of net income to net cash provided by operating activities

(Reversal of) provision for credit losses ( 997 ) 1,508

Provision for (reversal of) credit losses 604 ( 107 )

Depreciation 562 535

1 unchanged sentence

Net gain on sale of mortgage loans ( 33 ) ( 30 )

Increase in cash value of BOLI ( 1,125 ) ( 733 )

Increase in the cash surrender value of BOLI, net of expenses ( 444 ) ( 368 )

Gains from redemption of BOLI policies ( 131 ) —

Share-based payment awards 172 174

11 unchanged sentences

Purchases of BOLI policies — ( 10,583 )

Proceeds from redemption of BOLI policies 535 —

Proceeds from sale of FHLB stock — 7,162

Proceeds from sales of foreclosed assets 375 58

Low income housing tax credit investments — ( 3,767 )

7 unchanged sentences

Common stock repurchased ( 402 ) ( 1,145 )

Common stock purchased for deferred compensation obligations — ( 991 )

Net cash provided by (used in) financing activities 38,701 11,833

2 unchanged sentences

Cash and cash equivalents at end of period $ 50,105 $ 69,179

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (continued)

(Dollars in thousands)

Supplemental cash flows information

Interest paid $ 8,121 $ 7,919

Income taxes paid 1,900 1,800

Federal income taxes paid — —

Supplemental noncash information

Transfers of loans to foreclosed assets 30 218

Transfers of foreclosed assets to premises and equipment 90 —

See notes to interim condensed consolidated financial statements (unaudited).

3 unchanged sentences

Basis of Presentation and Consolidation

As used in these notes, as well as in Management's Discussion and Analysis of Financial Condition and Results of Operations, references to “we,” “our,” “us,” and “the Corporation” refer to Isabella Bank Corporation, a Michigan corporation and registered financial holding company, our wholly-owned banking subsidiary, Isabella Bank, and our other consolidated subsidiaries.

The consolidated financial statements include the accounts of Isabella Bank Corporation, a registered financial holding company, and its wholly owned banking subsidiary, Isabella Bank.

All intercompany balances and accounts have been eliminated in consolidation.

References to “we,” “our,” “us,” and “the Corporation” refer to Isabella Bank Corporation, a Michigan corporation and registered financial holding company, our wholly-owned banking subsidiary, Isabella Bank, and our other consolidated subsidiaries.

References to “the Bank” refer to Isabella Bank.

The accompanying unaudited interim condensed consolidated financial statements in this Quarterly Report on Form 10-Q for the three and nine-month periods ended September 30, 2025 (this “Form 10-Q”) have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X.

The accompanying unaudited interim condensed consolidated financial statements in this Form 10-Q have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X.

Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.

In our opinion, all adjustments considered necessary for a fair presentation have been included.

Operating results for the three and nine-month periods ended September 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025.

Operating results for the three-month period ended March 31, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026.

For further information, refer to our Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC on March 13, 2026 (the “2025 Annual Report on Form 10-K”).

All financial data presented in these notes, as well as in Management’s Discussion and Analysis of Financial Condition and Results of Operations, including financial data presented in the tables and explanations thereof, are expressed in thousands except per share amounts and ratios and unless otherwise noted.

All financial data presented in these notes, as well as in Management’s Discussion and Analysis of Financial Condition and Results of Operations of this Form 10-Q, including financial data presented in the tables and explanations thereof, are expressed in thousands except per share amounts and ratios and unless otherwise noted.

Operating Segments

6 unchanged sentences

Further, the CODM uses revenue streams to evaluate product pricing and significant expenses to assess performance and evaluate return on assets.

Consolidated net income is used to benchmark results against our competitors.

Benchmarking and monitoring of budget to actual results are used in assessment performance and in establishing compensation.

Consolidated net income is used to benchmark our results against our competitors.

Benchmarking and monitoring of budget to actual results are used in assessing performance and in establishing compensation.

Revenue from banking operations consists primarily of loan and investment interest, deposit related fees, and wealth fees.

1 unchanged sentence

All operations are domestic.

RECLASSIFICATIONS:

Certain amounts reported in the interim 2024 consolidated financial statements have been reclassified to conform with the 2025 presentation.

Changes in Significant Accounting Policies

Our accounting policies are materially the same as those discussed in Note 1 to the Consolidated Financial Statements included in our 2025 Annual Report on Form 10-K.

Subsequent Events

We evaluated subsequent events after September 30, 2025 through the date our interim condensed consolidated financial statements were issued for potential recognition and disclosure.

We determined that no subsequent events require financial statement recognition or disclosure between September 30, 2025 and the date our interim condensed consolidated financial statements were issued.

We evaluated subsequent events after March 31, 2026 through the date our interim condensed consolidated financial statements were issued for potential recognition and disclosure.

Management determined that no subsequent events require financial statement recognition or disclosure between March 31, 2026 and the date our interim condensed consolidated financial statements were issued.

Pending Accounting Standards

“Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses”

In November 2024, ASU No.

2024-03 was issued to improve the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales, selling general and administrative expense, and research and development).

The new authoritative guidance is effective for annual periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027, as clarified in ASU No.

2025-01 issued in January 2025.

The new authoritative guidance under ASU No.

2024-03 is not expected to have a significant impact on our operations or financial statement disclosures.

Note 2 – AFS Securities

The amortized cost and fair value of AFS securities, with gross unrealized gains and losses, are as follows at:

September 30, 2025

The amortized cost and fair value of AFS securities, with gross unrealized gains and losses, are as follows as of the dates indicated:

March 31, 2026

Treasury $ 160,172 $ — $ 1,809 $ 158,363

1 unchanged sentence

Auction rate money market preferred 3,200 — 820 2,380

Mortgage-backed securities 24,696 — 1,299 23,397

Collateralized mortgage obligations 203,984 1,081 3,852 201,213

Agency mortgage-backed securities 22,074 — 1,161 20,913

Agency collateralized mortgage obligations 242,138 699 4,021 238,816

Corporate 6,450 — 512 5,938

4 unchanged sentences

Auction rate money market preferred 3,200 — 787 2,413

Mortgage-backed securities 29,068 — 2,182 26,886

Collateralized mortgage obligations 163,156 — 8,482 154,674

Agency mortgage-backed securities 23,373 — 1,121 22,252

Agency collateralized mortgage obligations 202,482 1,149 3,165 200,466

Corporate 6,450 — 529 5,921

Total $ 507,689 $ 1,194 $ 11,092 $ 497,791

The amortized cost and fair value of AFS securities by contractual maturity at September 30, 2025 are as follows:

We made an accounting policy election to exclude accrued interest receivable on AFS securities from the amortized cost basis of AFS securities, as displayed above.

Accrued interest receivable on AFS securities was $ 2,251 and $ 1,723 at March 31, 2026 and December 31, 2025, respectively, which is included in other assets on the consolidated balance sheets.

Additional policy information related to AFS securities are discussed in detail in Note 1, Significant Accounting Policies in the consolidated financial statements included within the 2025 Annual Report on Form 10-K.

The amortized cost and fair value of AFS securities by contractual maturity as of March 31, 2026 are as follows:

Maturing Securities with Variable Monthly Payments or Noncontractual Maturities

6 unchanged sentences

Auction rate money market preferred — — — — 3,200 3,200

Mortgage-backed securities — — — — 24,696 24,696

Collateralized mortgage obligations — — — — 203,984 203,984

Agency mortgage-backed securities — — — — 22,074 22,074

Agency collateralized mortgage obligations — — — — 242,138 242,138

Corporate — — 6,450 — — 6,450

3 unchanged sentences

As the auction rate money market preferred investments have continual call dates, they are not reported by a specific maturity group.

Because of their variable monthly payments, mortgage-backed securities and collateralized mortgage obligations are not reported by a specific maturity group.

The information in the following tables pertains to AFS securities with gross unrealized losses at September 30, 2025 and December 31, 2024, aggregated by investment category and length of time that individual securities have been in a continuous loss position for which an allowance for credit losses has not been recorded.

September 30, 2025

Because of their variable monthly payments, agency mortgage-backed securities and collateralized mortgage obligations are not reported by a specific maturity group.

The information in the following tables pertains to AFS securities with gross unrealized losses as of March 31, 2026 and December 31, 2025, aggregated by investment category and length of time that individual securities have been in a continuous loss position for which an allowance for credit losses has not been recorded.

March 31, 2026

Less Than Twelve Months Twelve Months or More

2 unchanged sentences

Auction rate money market preferred — — 820 2,380 820

Mortgage-backed securities — — 1,299 23,397 1,299

Collateralized mortgage obligations 59 8,991 3,793 125,753 3,852

Agency mortgage-backed securities — — 1,161 20,913 1,161

Agency collateralized mortgage obligations 521 66,333 3,500 110,791 4,021

Corporate — — 512 5,938 512

6 unchanged sentences

Auction rate money market preferred — — 787 2,413 787

Mortgage-backed securities — — 2,182 26,886 2,182

Collateralized mortgage obligations 185 5,646 8,297 149,028 8,482

Agency mortgage-backed securities — — 1,121 22,252 1,121

Agency collateralized mortgage obligations 39 9,042 3,126 120,016 3,165

Corporate — — 529 5,921 529

1 unchanged sentence

Number of securities in an unrealized loss position:

As of September 30, 2025, no ACL has been recognized on AFS securities in an unrealized loss position, as management does not believe any of the securities are impaired due to reasons of credit quality.

As of March 31, 2026, no ACL has been recognized on AFS securities in an unrealized loss position, as management does not believe any of the securities are impaired due to reasons of credit quality.

This is based on our analysis of the underlying risk characteristics, including credit ratings, and other qualitative factors related to our AFS securities and consideration of our historical credit loss experience and internal forecasts.

1 unchanged sentence

Management does not currently intend to sell any of the securities classified as AFS in the table above, and believes it is more likely than not that we will not have to sell any such securities before a recovery of cost.

The unrealized losses are generally due to a continued elevated market interest rate environment compared to the yields available at the time the underlying securities were purchased.

Unrealized losses are generally due to a continued elevated market interest rate environment compared to the yields available at the time the underlying securities were purchased.

The fair value is expected to recover as the securities approach their respective maturity date or repricing date, or if the market yields for such investments decline.

1 unchanged sentence

Loan Composition

The following table provides a detailed listing of our loan portfolio at:

September 30, 2025 December 31, 2024

The following table provides a detailed listing of our loan portfolio, excluding loans HFS, as of the dates indicated:

March 31, 2026 December 31, 2025

Balance Percent of Total Balance Percent of Total

26 unchanged sentences

Substantially all of our consumer and residential real estate loans are secured by various items of property, while commercial loans are secured primarily by real estate, business assets, and personal guarantees.

A small portion of loans are unsecured.

A portion of loans are unsecured.

Loans that we have the intent and ability to hold in our portfolio are reported at their outstanding principal balance adjusted for any charge-offs, the ACL, and deferred fees or costs.

Unless a loan has a nonaccrual status, interest income is accrued over the term of the loan based on the principal amount outstanding.

Loan origination fees and certain direct loan origination costs are capitalized and recognized as a component of interest income over the term of the loan using the appropriate amortization method.

Net unamortized deferred loan costs were $ 3,129 and $ 3,330 at September 30, 2025 and December 31, 2024, respectively.

We made an accounting policy election to exclude accrued interest receivable on loans from the amortized cost basis of loans.

Accrued interest receivable on loans was $ 7,111 and $ 6,666 at March 31, 2026 and December 31, 2025, respectively, which is included in other assets on the consolidated balance sheets.

Loan origination fees and certain direct loan origination costs are capitalized and recognized as a component of interest income over the term of the loan using the interest method.

Net unamortized deferred loan costs were $ 2,929 and $ 2,989 as of March 31, 2026 and December 31, 2025, respectively.

Commercial and agricultural loans include loans for commercial real estate, commercial operating loans, advances to mortgage brokers, farmland and agricultural production, and loans to states and political subdivisions.

2 unchanged sentences

Borrowers with direct credit needs of more than $ 18,000 may be serviced through the use of loan participations with other commercial banks.

Commercial and agricultural real estate loans commonly

require loan-to-value limits of 80 % or less.

Commercial and agricultural real estate loans commonly require loan-to-value limits of 80 % or less.

Depending upon the type of loan, past credit history, and current operating results, we may require the borrower to pledge accounts receivable, inventory, property, or equipment.

Government agency guarantee may be required.

Government agency guarantees may be required.

Personal guarantees and/or life insurance beneficiary assignments are generally required from the owners of closely held corporations, partnerships, and sole proprietorships.

In addition, we may require annual financial statements, prepare cash flow analyses, and review credit reports.

In addition, we may require annual financial statements, prepare cash flow analyses, and review credit reports of our borrowers.

We offer adjustable-rate mortgages, construction loans, and fixed rate residential real estate loans which have amortization periods up to a maximum of 30 years.

11 unchanged sentences

Generally, mortgage loan requests are reviewed by our mortgage loan committee or through a secondary market underwriting system.

loans in excess of $ 1,000 require the approval of one or more of the following committees:

Loans in excess of $ 1,000 require the approval of one or more of the following Bank committees:

Internal Loan Committee, the Executive Loan Committee, or the Board of Directors.

4 unchanged sentences

Nonaccrual and Past Due Loans

The accrual of interest on commercial and agricultural loans, as well as residential real estate loans, is discontinued at the time a loan is 90 days or more past due unless the credit is well-secured and in the process of short-term collection.

Upon transferring a loan to nonaccrual status, we perform an evaluation to determine the net realizable value of the underlying collateral.

This evaluation is used to help determine if a charge-off is necessary.

Consumer loans are typically charged off no later than 180 days past due.

Past due status is based on the contractual term of the loan.

In all cases, a loan is placed in nonaccrual status at an earlier date if collection of principal or interest is considered doubtful.

When a loan is placed in nonaccrual status, all interest accrued in the current calendar year, but not collected, is reversed against interest income while interest accrued in prior calendar years, but not collected, is charged against the ACL.

Loans may be returned to accrual status after six months of continuous performance and achievement of current payment status.

Accrued interest receivable on loans was $ 6,592 and $ 6,384 at September 30, 2025 and December 31, 2024, respectively, which is included in other assets on the consolidated balance sheets.

The following table summarizes nonaccrual loan data by class of loans as of:

September 30, 2025 December 31, 2024

Nonaccrual loan policies, including a description of nonaccrual loans, are discussed in detail in Note 1, Significant Accounting Policies, and Note 3, Loans and ACL, in the consolidated financial statements included within the 2025 Annual Report on Form 10-K.

The following table summarizes nonaccrual loan data by class of loans as of the dates indicated:

March 31, 2026 December 31, 2025

Total Nonaccrual Loans Nonaccrual Loans with No ACL Total Nonaccrual Loans Nonaccrual Loans with No ACL

2 unchanged sentences

Commercial real estate

Commercial mortgage owner occupied 743 — 766 —

Commercial mortgage 1-4 family investor 3,000 3,000 3,000 3,000

2 unchanged sentences

Total $ 4,418 $ 3,242 $ 4,578 $ 3,370

The following tables summarize the past due and current loans for the entire loan portfolio as of:

September 30, 2025

The following tables summarize the past due and current loans for the entire loan portfolio as of the dates indicated:

March 31, 2026

Accruing Loans 90 or More Days Past Due

51 unchanged sentences

Total $ 6,532 $ 1,629 $ 3,000 $ 1,525,203 $ 1,536,364 $ —

Credit Quality Indicators

The following tables display commercial and agricultural loans by credit risk ratings and year of origination as of:

September 30, 2025

Credit Quality Ratings and Indicators

We have certain lending policies and procedures in place designed to maximize loan income within an acceptable level of risk.

The Board of Directors reviews and approves these policies and procedures on a regular basis.

A reporting system supplements the review process by providing management and the Board of Directors with frequent reports related to loan production, loan quality, and concentration of credit, loan delinquencies, nonperforming loans and potential problem loans.

We seek to diversify the loan portfolio as a means of managing risk associated with fluctuations in economic conditions.

Internally assigned credit risk ratings are reviewed, at a minimum, when loans are renewed or when management has knowledge of improvements or deterioration of the credit quality of individual credits .

Descriptions of the internally assigned credit risk ratings for commercial and agricultural loans are discussed in detail in Note 3, Loans and ACL, in the consolidated financial statements included within the 2025 Annual Report on Form 10-K.

The following tables display commercial and agricultural loans by credit risk ratings and year of origination as of the dates indicated:

March 31, 2026

2026 2025 2024 2023 2022 Prior Revolving

31 unchanged sentences

2026 year-to-date gross charge-offs $ — $ — $ — $ 154 $ — $ — $ — $ — $ 154

March 31, 2026

2026 2025 2024 2023 2022 Prior Revolving

Loans Revolving Loans Converted to Term Total

Commercial real estate:

9 unchanged sentences

2026 year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ —

September 30, 2025

2025 2024 2023 2022 2021 Prior Revolving

Loans Revolving Loans Converted to Term Total

Commercial real estate:

32 unchanged sentences

2026 year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ —

March 31, 2026

2026 2025 2024 2023 2022 Prior Revolving

Loans Revolving Loans Converted to Term Total

Agricultural other

42 unchanged sentences

2025 year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ —

December 31, 2025

2025 2024 2023 2022 2021 Prior Revolving

Loans Revolving Loans Converted to Term Total

Commercial real estate:

9 unchanged sentences

2025 year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ —

December 31, 2024

2024 2023 2022 2021 2020 Prior Revolving

Loans Revolving Loans Converted to Term Total

Commercial real estate:

32 unchanged sentences

2025 year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ —

December 31, 2025

2025 2024 2023 2022 2021 Prior Revolving

Loans Revolving Loans Converted to Term Total

Agricultural other

8 unchanged sentences

2025 year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ —

We have certain lending policies and procedures in place designed to maximize loan income within an acceptable level of risk.

The Board of Directors reviews and approves these policies and procedures on a regular basis.

We seek to diversify the loan portfolio as a means of managing risk associated with fluctuations in economic conditions.

Descriptions of the internally assigned credit risk ratings for commercial and agricultural loans are as follows:

EXCELLENT – Substantially Risk Free

Credit has strong financial condition and solid earnings history, characterized by:

• High liquidity, strong cash flow, low leverage.

• Unquestioned ability to meet all obligations when due.

• Experienced management, with management succession in place.

• Secured by cash.

HIGH QUALITY – Limited Risk

Credit with sound financial condition and a positive trend in earnings supplemented by:

• Favorable liquidity and leverage ratios.

• Ability to meet all obligations when due.

• Management with successful track record.

• Steady and satisfactory earnings history.

• If loan is secured, collateral is of high quality and readily marketable.

• Access to alternative financing.

• Well defined primary and secondary source of repayment.

• If supported by guaranty, the financial strength and liquidity of the guarantor(s) are clearly evident.

HIGH SATISFACTORY – Reasonable Risk

Credit with satisfactory financial condition and further characterized by:

• Working capital adequate to support operations.

• Cash flow sufficient to pay debts as scheduled.

• Management experience and depth appear favorable.

• Loan performing according to terms.

• If loan is secured, collateral is acceptable, and loan is fully protected.

SATISFACTORY – Acceptable Risk

Credit with bankable risks, although some signs of weaknesses are shown:

• Would include most start-up businesses.

• Occasional instances of trade slowness or repayment delinquency – may have been 10 - 30 days slow within the past year.

• Management’s abilities are apparent yet unproven.

• Weakness in primary source of repayment with adequate secondary source of repayment.

• Loan structure generally in accordance with policy.

• If secured, loan collateral coverage is marginal.

To be classified as less than satisfactory, only one of the following criteria must be met.

SPECIAL MENTION – Criticized

Credit constitutes an undue and unwarranted credit risk but not to the point of justifying a classification of substandard.

The credit risk may be relatively minor yet constitutes an unwarranted risk in light of the circumstances surrounding a specific loan:

• Downward trend in sales, profit levels, and margins.

• Impaired working capital position.

• Cash flow is strained in order to meet debt repayment.

• Loan delinquency ( 30 - 60 days) and overdrafts may occur.

• Shrinking equity cushion.

• Diminishing primary source of repayment and questionable secondary source.

• Management abilities are questionable.

• Weak industry conditions.

• Litigation pending against the borrower.

• Loan may need to be restructured to improve collateral position or reduce payments.

• Collateral or guaranty offers limited protection.

• Negative debt service coverage, however, the credit is well collateralized, and payments are current.

SUBSTANDARD – Classified

Credit is inadequately protected by the current net worth and paying capacity of the borrower or of the collateral pledged.

There is a distinct possibility we will implement collection procedures if the loan deficiencies are not corrected.

Any commercial loan placed in nonaccrual status will be rated “7” or worse.

In addition, the following characteristics may apply:

• Sustained losses have severely eroded the equity and cash flow.

• Deteriorating liquidity.

• Serious management problems or internal fraud.

• Original repayment terms liberalized.

• Likelihood of bankruptcy.

• Inability to access other funding sources.

• Reliance on secondary source of repayment.

• Litigation filed against borrower.

• Interest non-accrual may be warranted.

• Collateral provides little or no value.

• Requires excessive attention of the loan officer.

• Borrower is uncooperative with loan officer.

VULNERABLE – Classified

Credit is considered “Substandard” and warrants placing in nonaccrual status.

Risk of loss is being evaluated and exit strategy options are under review.

Other characteristics that may apply:

• Insufficient cash flow to service debt.

• Minimal or no payments being received.

• Limited options available to avoid the collection process.

• Transition status, expect action will take place to collect loan without immediate progress being made.

DOUBTFUL – Workout

Credit has all the weaknesses inherent in a “Substandard” loan with the added characteristic that collection and/or liquidation is pending.

The possibility of a loss is extremely high, but its classification as a loss is deferred until liquidation procedures are completed, or reasonably estimable.

Other characteristics that may apply:

• Normal operations are severely diminished or have ceased.

• Seriously impaired cash flow.

• Original repayment terms materially altered.

• Secondary source of repayment is inadequate.

• Survivability as a “going concern” is impossible.

• Collection process has begun.

• Bankruptcy petition has been filed.

• Judgments have been filed.

• Portion of the loan balance has been charged off.

LOSS – Charge-off

Credit is considered uncollectible and of such little value that their continuance as bankable assets is not warranted.

This classification is for charged-off loans but does not mean that the asset has absolutely no recovery or salvage value.

These loans are further characterized by:

• Liquidation or reorganization under bankruptcy, with poor prospects of collection.

• Fraudulently overstated assets and/or earnings.

• Collateral has marginal or no value.

• Debtor cannot be located.

• Over 120 days delinquent.

Our primary credit quality indicator for residential real estate and consumer loans is the individual loan’s past due status.

The following tables display residential real estate and consumer loans by payment status and year of origination as of:

September 30, 2025

The following tables display loans by payment status and year of origination as of the dates indicated:

March 31, 2026

2026 2025 2024 2023 2022 Prior Revolving

29 unchanged sentences

2026 year-to-date gross charge-offs $ — $ — $ 23 $ — $ — $ — $ — $ — $ 23

March 31, 2026

2026 2025 2024 2023 2022 Prior Revolving

Loans Revolving Loans Converted to Term Total

Secured - indirect

5 unchanged sentences

2026 year-to-date gross charge-offs $ — $ — $ — $ 50 $ — $ 16 $ — $ — $ 66

September 30, 2025

2025 2024 2023 2022 2021 Prior Revolving

Loans Revolving Loans Converted to Term Total

Current $ 480 $ 1,356 $ 510 $ 99 $ 28 $ 2 $ 837 $ — $ 3,312

29 unchanged sentences

2025 year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ —

December 31, 2025

2025 2024 2023 2022 2021 Prior Revolving

Loans Revolving Loans Converted to Term Total

Secured - direct

5 unchanged sentences

2025 year-to-date gross charge-offs $ — $ 1 $ 19 $ 36 $ — $ 12 $ — $ — $ 68

December 31, 2024

2024 2023 2022 2021 2020 Prior Revolving

Loans Revolving Loans Converted to Term Total

Secured - indirect

24 unchanged sentences

• The borrower is unlikely to continue as a going concern (if the entity is a business).

The following is a summary of the amortized cost basis of loan modifications granted to borrowers experiencing financial difficulty for the:

Three Months Ended September 30, 2025

Other-Than-Insignificant Payment Delay Term Extension Other-Than-Insignificant Payment Delay and Term Extension

Amortized Cost Basis % of Total Class of Financial Receivable Amortized Cost Basis % of Total Class of Financial Receivable Amortized Cost Basis % of Total Class of Financial Receivable

Commercial and industrial

Secured $ — 0.00 % $ — 0.00 % $ 443 0.18 %

Agricultural mortgage 914 1.35 % — 0.00 % — 0.00 %

Agricultural other — 0.00 % 925 3.08 % — 0.00 %

Total $ 914 $ 925 $ 443

Nine Months Ended September 30, 2025

The following is a summary of the amortized cost basis of loan modifications granted to borrowers experiencing financial difficulty for the periods indicated:

Three Months Ended March 31, 2026

Interest Rate Reduction Other-Than-Insignificant Payment Delay Term Extension Other-Than-Insignificant Payment Delay and Term Extension

4 unchanged sentences

Commercial mortgage owner occupied 154 0.06 % 2,044 0.85 % — 0.00 % — 0.00 %

Agricultural mortgage — 0.00 % 914 1.35 % — 0.00 % — 0.00 %

Agricultural other — 0.00 % — 0.00 % — 0.00 % 2,700 9.50 %

Total $ 154 $ 2,044 $ 10 $ 2,700

Three Months Ended September 30, 2024

Interest Rate Reduction

Three Months Ended March 31, 2025

Term Extension

Amortized Cost Basis % of Total Class of Financial Receivable

Agricultural other $ 181 0.60 %

Nine Months Ended September 30, 2024

Interest Rate Reduction Other-Than-Insignificant Payment Delay Term Extension Other-Than-Insignificant Payment Delay and Term Extension

Amortized Cost Basis % of Total Class of Financial Receivable Amortized Cost Basis % of Total Class of Financial Receivable Amortized Cost Basis % of Total Class of Financial Receivable Amortized Cost Basis % of Total Class of Financial Receivable

Commercial and industrial

2 unchanged sentences

Commercial mortgage owner occupied 1,524 0.83 %

Agricultural mortgage — 0.00 % 1,305 1.95 % — 0.00 % — 0.00 %

Agricultural other 181 0.60 % — 0.00 % — 0.00 % 1,038 3.46 %

Secured - indirect — 0.00 % — 0.00 % 1 0.00 % — 0.00 %

Total $ 2,056

We do not modify any loans by forgiving principal or accrued interest.

We had committed to advance $ 79 and $ 43 in additional funds to be disbursed in connection with modified loans at September 30, 2025 and December 31, 2024, respectively, as displayed in the tables above.

The following is a summary of the financial effect of the modifications granted to borrowers experiencing financial difficulty for the:

Three Months Ended September 30

Payment Delay Term Weighted-Average Term Extension (Years) Weighted-Average Interest Rate Reduction

Commercial and industrial

Secured 6 months 1.08 N/A

Agricultural mortgage 4 months N/A N/A

Agricultural other N/A 0.50 0.50 %

Nine Months Ended September 30

Weighted-Average Interest Rate Reduction Payment Delay Term Weighted-Average Term Extension (Years) Weighted-Average Interest Rate Reduction Payment Delay Term Weighted-Average Term Extension (Years)

We had committed to advance $ 0 and $ 221 in additional funds to be disbursed in connection with modified loans as of March 31, 2026 and December 31, 2025, respectively, as displayed in the tables above.

The following is a summary of the financial effect of the modifications granted to borrowers experiencing financial difficulty for the periods indicated:

Three Months Ended March 31

Weighted-Average Interest Rate Reduction Payment Delay Term Weighted-Average Term Extension (Years) Weighted-Average Term Extension (Years)

Commercial and industrial

Secured 10.00 % 8.1 months 1.05 N/A 4 months 3.00

Secured N/A N/A 3.25 4.4

Commercial real estate

Commercial mortgage owner occupied N/A N/A 15.00 N/A 7 months N/A

Agricultural mortgage N/A 4 months N/A N/A 5 months 0.50

Agricultural other N/A N/A 0.50 0.50 % 4 months 0.33

Secured - indirect N/A N/A N/A N/A N/A 1.33

Commercial mortgage owner occupied 4.00 % 6 months N/A 15.0

Agricultural other N/A 5 months 0.47 N/A

We closely monitor the performance of loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of our modification efforts.

The following tables summarize the amortized cost basis of loans that have been modified within the past 12 months prior to:

September 30, 2025

The following tables summarize the amortized cost basis of loans that have been modified within the 12 months prior to the dates indicated:

March 31, 2026

Current 30-59 Days

8 unchanged sentences

Agricultural other 3,476 — — — 3,476

Residential real estate

Senior lien — — — 85 85

Total $ 9,600 $ — $ 154 $ 518 $ 10,272

September 30, 2024

March 31, 2025

Current 30-59 Days

6 unchanged sentences

Commercial mortgage owner occupied 2,872 — — — 2,872

Commercial mortgage multifamily 2,917 — — — 2,917

Agricultural mortgage 1,584 — — — 1,584

Agricultural other 924 — — — 924

Secured - indirect 1 — — — 1

Total $ 7,548 $ — $ — $ — $ 7,548

We had no loans that defaulted in each of the three and nine-month periods ended September 30, 2025 and 2024 which were modified within 12 months prior to the default date.

The following table summarizes the amortized cost basis of loans that defaulted in the three-month period ended March 31, 2026 and were modified within 12 months prior to the default date.

There were none that defaulted in the three-month period ended March 31, 2025 and were modified within 12 months prior to the default date.

March 31, 2026

Other-Than-Insignificant Payment Delay Other-Than-Insignificant Payment Delay and Term Extension

Commercial and industrial

Secured $ — $ 433

Residential real estate

Senior lien 85 —

Total $ 85 $ 433

The credit quality of our loan portfolio is continuously monitored and is reflected within the ACL for loans.

7 unchanged sentences

In future periods evaluations of the overall loan portfolio, in light of the factors and forecasts then prevailing, may result in significant changes in the allowance and credit loss expense in those future periods.

The methodology for estimating the amount of expected credit losses reported in the ACL has two basic components:

a component of individual loans that do not share risk characteristics with other loans;

and a pooled component for estimated expected credit losses for pools of loans that share similar risk characteristics.

For a loan that does not share risk characteristics with other loans, an individual analysis is performed to measure an allowance.

Loans in nonaccrual status over established dollar thresholds are individually evaluated for specific allocation of the allowance using the fair value of collateral, less costs to sell if foreclosure is probable, or the discounted cash flow method.

recognize interest income on loans in nonaccrual status.

For loans not classified as nonaccrual, interest income is recognized daily, as earned, according to the terms of the loan agreement and the principal amount outstanding.

In determining the allowance for credit losses, we derive an estimated credit loss assumption from a model that categorizes loan pools based on loan type and credit risk ratings or delinquency bucket.

This model calculates an expected loss percentage for each loan class by considering the probability of default, based on the migration of loans from performing to loss by credit risk ratings or delinquency buckets using life-of-loan analysis, and the historical severity of loss, based on the aggregate net lifetime losses incurred per loan class.

The default and severity factors used to calculate the allowance for credit losses for loans that share similar risk characteristics with other loans are adjusted for differences between the historical period used to calculate historical default and loss severity rates and expected conditions over the remaining lives of the loans in the portfolio.

These qualitative factors are used to adjust the historical probabilities of default and severity of loss so that they reflect management's expectation of future conditions based on a reasonable and supportable forecast.

To the extent the lives of the loans in the portfolio extend beyond the period for which a reasonable and supportable forecast can be made, the model reverts back to the historical rates of default and severity of loss.

Qualitative factors include:

• Changes in lending policies and procedures, including changes in underwriting standards and collection, charge-off, recovery practices not considered elsewhere in estimating credit losses;

• Changes in the experience, ability, and depth of lending management and other relevant staff;

• Changes in interest rates;

• Changes in international, national, regional, and local economic factors;

• Changes in the nature and volume of the portfolio and in the terms of loans;

• Changes in the volume and severity of past due loans, the volume of nonaccrual loans, and the volume and severity of adversely classified or graded loans;

• Lack of current financial information;

• Competition, legal, and regulatory;

• Changes in the value of underlying collateral.

A summary of activity in the ACL for loans, excluding unfunded commitments, by portfolio segment and the recorded investment in loans by segments follows for the:

Three Months Ended September 30, 2025

Commercial and Industrial Commercial Real Estate Agricultural Residential Real Estate Consumer Total

June 30, 2025 $ 1,318 $ 5,277 $ 316 $ 4,673 $ 1,393 $ 12,977

Charge-offs — — — — ( 175 ) ( 175 )

Recoveries 6 4 — 16 75 101

Provision for credit losses 29 102 1 107 7 246

September 30, 2025 $ 1,353 $ 5,383 $ 317 $ 4,796 $ 1,300 $ 13,149

Nine Months Ended September 30, 2025

The methodology for estimating the amount of expected credit losses reported in the ACL is described within Note 3, Loans and ACL, in the consolidated financial statements included within the 2025 Annual Report on Form 10-K.

A summary of activity in the ACL for loans, excluding unfunded commitments, by portfolio segment and the recorded investment in loans by segments follows for the periods indicated:

Three Months Ended March 31, 2026

Commercial and Industrial Commercial Real Estate Agricultural Residential Real Estate Consumer Total

2 unchanged sentences

Recoveries 4 21 — 15 57 97

Reversal of credit losses 19 156 30 230 ( 1,591 ) ( 1,156 )

September 30, 2025 $ 1,353 $ 5,383 $ 317 $ 4,796 $ 1,300 $ 13,149

Three Months Ended September 30, 2024

Commercial and Industrial Commercial Real Estate Agricultural Residential Real Estate Consumer Total

June 30, 2024 $ 1,264 $ 5,569 $ 258 $ 4,351 $ 1,653 $ 13,095

Charge-offs — — — — ( 1,767 ) ( 1,767 )

Recoveries 6 318 — 20 64 408

Provision for credit losses ( 46 ) ( 710 ) — ( 40 ) 1,695 899

September 30, 2024 $ 1,224 $ 5,177 $ 258 $ 4,331 $ 1,645 $ 12,635

Nine Months Ended September 30, 2024

Provision for (reversal of) credit losses 9 406 ( 27 ) 75 77 540

March 31, 2026 $ 1,146 $ 6,222 $ 300 $ 5,148 $ 1,198 $ 14,014

Three Months Ended March 31, 2025

Commercial and Industrial Commercial Real Estate Agricultural Residential Real Estate Consumer Total

2 unchanged sentences

Recoveries 80 2 — 14 128 224

Provision for credit losses 582 ( 1,054 ) ( 14 ) ( 107 ) 1,918 1,325

September 30, 2024 $ 1,224 $ 5,177 $ 258 $ 4,331 $ 1,645 $ 12,635

The following table illustrates the two main components of the ACL as of:

Provision for (reversal of) credit losses ( 157 ) 1 ( 21 ) 66 ( 101 ) ( 212 )

March 31, 2025 $ 1,239 $ 5,174 $ 266 $ 4,600 $ 1,456 $ 12,735

The following table illustrates the components of the ACL as of the dates indicated:

2026 December 31

2025 September 30

2025 March 31

Individually evaluated $ 227 $ 259 $ — $ — $ —

1 unchanged sentence

Total $ 14,014 $ 13,727 $ 13,149 $ 12,977 $ 12,735

ACL to gross loans

Individually evaluated 0.01 % 0.02 % 0.00 % 0.00 % 0.00 %

1 unchanged sentence

Total 0.90 % 0.89 % 0.92 % 0.93 % 0.93 %

The following table presents loans that were evaluated for expected credit losses on an individual basis and the related specific allocations, by loan segment as of:

September 30, 2025 December 31, 2024

The following table presents loans that were evaluated for expected credit losses on an individual basis and the related specific allocations, by loan segment as of the dates indicated:

March 31, 2026 December 31, 2025

Loan Balance Specific Allocation Loan Balance Specific Allocation

8 unchanged sentences

Appraisals are updated every one to two years depending on the type of loan and the total exposure of the borrower.

Loans evaluated for expected credit losses on an individual basis as of September 30, 2025 include $ 3,426 in collateral dependent loans secured by commercial real estate and residential real estate of $ 3,000 and $ 426 , respectively.

Loans evaluated for expected credit losses on an individual basis as of March 31, 2026 include $ 4,343 in collateral dependent loans secured by commercial real estate, commercial equipment, and residential real estate of $ 3,743 , $ 433 , and $ 167 , respectively.

Note 4 – Borrowed Funds

1 unchanged sentence

Short-term borrowings include securities sold under repurchase agreements without stated maturity dates, federal funds purchased, and FRB Discount Window advances, which all generally mature within one to three days from the transaction date.

A summary of short-term borrowed funds without stated maturity dates was as follows for the:

Three Months Ended September 30

Maximum Month End Balance Average Balance Weighted Average Interest Rate During the Period Maximum Month End Balance Average Balance Weighted Average Interest Rate During the Period

Securities sold under agreements to repurchase without stated maturity dates $ 62,022 $ 52,700 3.17 % $ 56,051 $ 48,151 3.18 %

Federal funds purchased — — 0.00 % — — 0.00 %

FRB Discount Window — — 0.00 % 5,300 153 5.18 %

Nine Months Ended September 30

A summary of short-term borrowed funds without stated maturity dates was as follows for the periods indicated:

Three Months Ended March 31

Maximum Month End Balance Average Balance Weighted Average Interest Rate During the Period Maximum Month End Balance Average Balance Weighted Average Interest Rate During the Period

3 unchanged sentences

Securities sold under agreements to repurchase are classified as secured borrowings and are reflected at the amount of cash received in connection with the transaction.

The securities underlying the agreements have a carrying value and a fair value of $ 87,641 and $ 67,539 at September 30, 2025 and December 31, 2024, respectively.

The securities underlying the agreements have a carrying value and a fair value of $ 139,962 and $ 87,752 as of March 31, 2026 and December 31, 2025, respectively.

Such securities remain under our control.

We may be required to provide additional collateral based on the fair value of underlying securities.

Securities sold under repurchase agreements without stated maturity dates were as follows as of:

September 30, 2025 December 31, 2024

We may be required to provide additional collateral based on changes to the fair value of underlying securities.

Securities sold under repurchase agreements without stated maturity dates were as follows as of the dates indicated:

March 31, 2026 December 31, 2025

Amount Rate Amount Rate

Securities sold under agreements to repurchase without stated maturity dates $ 113,530 3.50 % $ 68,000 3.45 %

We had pledged AFS securities and 1-4 family residential real estate loans in the following amounts at:

We had pledged AFS securities and 1-4 family residential real estate loans in the following amounts as of the dates indicated:

2026 December 31

3 unchanged sentences

Total $ 515,686 $ 581,252

AFS securities pledged to repurchase agreements consisted of the following at:

AFS securities pledged to repurchase agreements consisted of the following as of the dates indicated:

2026 December 31

Treasury $ 59,387 $ 78,992

Mortgage-backed securities 7,192 7,979

Collateralized mortgage obligations 1,902 2,289

Agency mortgage-backed securities 6,569 6,928

Agency collateralized mortgage obligations 74,006 1,832

Total $ 139,962 $ 87,752

1 unchanged sentence

In the event of maturities, calls, significant principal repayments, or significant decline in market values, we have an adequate level of AFS securities to pledge to satisfy collateral requirements.

As of September 30, 2025, we had the ability to borrow up to an additional $ 384,555 without pledging additional collateral.

As of March 31, 2026, we had the ability to borrow up to an additional $ 397,670 without pledging additional collateral.

FHLB advances

FHLB advances are collateralized by a blanket lien on all qualified 1-4 family residential real estate loans, specific AFS securities, and FHLB stock.

The following table lists the maturities and weighted average interest rates of FHLB advances as of:

September 30, 2025 December 31, 2024

The following table lists the maturities and weighted average interest rates of FHLB advances as of the dates indicated:

March 31, 2026 December 31, 2025

Amount Rate Amount Rate

Fixed rate due 2025 $ — 0.00 % $ 30,000 4.52 %

Fixed rate due 2026 $ — N/A $ 45,000 3.92 %

Subordinated notes

We have $ 30,000 in aggregate principal amount of 3.25 % Fixed-to-Floating Rate Subordinated Notes due 2031 (the "Notes").

The Notes initially bear a fixed interest rate of 3.25 % until June 15, 2026, after which time until maturity on June 15, 2031, the interest rate will reset quarterly to an annual floating rate equal to the then-current 3-month SOFR plus 256 basis points.

The Notes initially bear a fixed interest rate of 3.25 % until June 15, 2026, after which time and until maturity on June 15, 2031, the interest rate will reset quarterly to an annual floating rate equal to the then-current 3-month SOFR plus 256 basis points.

The Notes are redeemable by us at any time at our option, in whole or in part, on or after June 15, 2026.

1 unchanged sentence

Additionally, the Notes are intended to qualify for Tier 2 capital treatment, subject to regulatory limitations.

The following table summarizes our outstanding subordinated notes as of:

September 30, 2025 December 31, 2024

The following table summarizes our outstanding subordinated notes as of the dates indicated:

March 31, 2026 December 31, 2025

Amount Rate Amount Rate

6 unchanged sentences

Diluted earnings per common share includes additional common shares that would have been outstanding if dilutive potential common shares had been issued.

Potential common shares that may be issued relate solely to outstanding shares in the Directors Plan and grant awards under the RSP.

Earnings per common share have been computed based on the following for the:

Potential common shares that may be issued relate solely to outstanding shares in the Directors Plan, grant awards under the RSP, and purchase options under the ESPP.

Earnings per common share have been computed based on the following for the periods indicated:

Three Months Ended

September 30 Nine Months Ended

2025 2024 2025 2024

Average number of common shares outstanding for basic calculation 7,325,789 7,419,739

Average potential effect of common shares in the RSP 13,675 19,087 13,628 16,833

Dilutive effect of stock compensation, awards, and options 3,269 12,423

Average number of common shares outstanding used to calculate diluted earnings per common share 7,329,058 7,432,162

4 unchanged sentences

Note 6 – Capital Ratios and Shareholders' Equity

As of September 30, 2025 and December 31, 2024, the most recent notifications from the FRB and the FDIC categorized us as “well capitalized” under the FDIC's regulatory framework for prompt corrective action and the Basel III capital guidelines.

As of March 31, 2026 and December 31, 2025, the most recent notifications from the FRB and the FDIC categorized us as “well capitalized” under the FDIC's regulatory framework for prompt corrective action and the Basel III capital guidelines.

To be categorized as “well capitalized,” an institution must maintain minimum total risk-based, Tier 1 risk-based, common equity Tier 1, and Tier 1 leverage ratios as set forth in the following tables.

1 unchanged sentence

Capital requirements to be considered “well capitalized” are based upon the FDIC's prompt corrective action regulations, as amended to reflect the changes under the Basel III capital guidelines.

There were no conditions or events since the notifications that we believe have changed our categories.

The following tables set forth these requirements and our ratios, both on a bank-only and on a consolidated basis, as of:

September 30, 2025

There were no conditions or events since the notifications that we believe have changed our categorizations.

The following tables set forth these capital requirements and our ratios, both on a bank-only and on a consolidated basis, as of the dates indicated:

March 31, 2026

Actual Minimum Capital

35 unchanged sentences

Total capital includes Tier 1 capital and Tier 2 capital.

Tier 2 capital includes a permissible portion of the allowances for credit losses and subordinated debt, net of unamortized issuance costs.

Tier 2 capital includes a permissible portion of the allowances for credit losses and outstanding subordinated debt, net of unamortized issuance costs.

There are no significant regulatory constraints placed on our capital.

At September 30, 2025, the Bank exceeded all minimum Basel III risk-based capital requirements with the capital conservation buffer.

As of March 31, 2026, the Bank exceeded all minimum Basel III risk-based capital requirements with the capital conservation buffer.

State banking regulations place certain restrictions on dividends paid by banks to their shareholders.

Dividends paid by the Corporation’s bank subsidiary would be prohibited if the effect thereof would cause the bank subsidiary’s capital to be reduced below applicable minimum capital requirements.

The following table summarizes the changes in AOCI by component for the:

Three Months Ended September 30

Securities Defined

Pension Plan Total Unrealized

Securities Defined

Pension Plan Total

Balance, July 1 $ ( 13,990 ) $ ( 397 ) $ ( 14,387 ) $ ( 26,939 ) $ ( 697 ) $ ( 27,636 )

OCI before reclassifications 5,030 — 5,030 13,081 — 13,081

Tax effect ( 1,052 ) — ( 1,052 ) ( 2,724 ) — ( 2,724 )

OCI, net of tax 3,978 — 3,978 10,357 — 10,357

Balance, September 30 $ ( 10,012 ) $ ( 397 ) $ ( 10,409 ) $ ( 16,582 ) $ ( 697 ) $ ( 17,279 )

Nine Months Ended September 30

The following table summarizes the changes in AOCI by component for the periods indicated:

Three Months Ended March 31

Securities Defined

6 unchanged sentences

OCI, net of tax ( 579 ) — ( 579 ) 3,916 — 3,916

Balance, September 30 $ ( 10,012 ) $ ( 397 ) $ ( 10,409 ) $ ( 16,582 ) $ ( 697 ) $ ( 17,279 )

Included in OCI for the three and nine-month periods ended September 30, 2025 and 2024 are changes in unrealized gains and losses related to certain auction rate money market preferred stocks.

Balance, March 31 $ ( 8,564 ) $ ( 38 ) $ ( 8,602 ) $ ( 17,042 ) $ ( 397 ) $ ( 17,439 )

Included in OCI for the three-month periods ended March 31, 2026 and 2025 are changes in unrealized gains and losses related to certain auction rate money market preferred stocks.

These investments, for federal income tax purposes, have no deferred federal income taxes related to unrealized gains or losses given the nature of the investments.

A summary of the components of unrealized gains on AFS securities included in OCI follows for the:

Three Months Ended September 30

Auction Rate Money Market Preferred All Other AFS Securities Total Auction Rate Money Market Preferred All Other AFS Securities Total

Unrealized gains (losses) arising during the period $ ( 64 ) $ 5,094 $ 5,030 $ 109 $ 12,972 $ 13,081

Tax effect — ( 1,052 ) ( 1,052 ) — ( 2,724 ) ( 2,724 )

Unrealized gains (losses), net of tax $ ( 64 ) $ 4,042 $ 3,978 $ 109 $ 10,248 $ 10,357

Nine Months Ended September 30

A summary of the components of unrealized gains on AFS securities included in OCI follows for the periods indicated:

Three Months Ended March 31

Auction Rate Money Market Preferred All Other AFS Securities Total Auction Rate Money Market Preferred All Other AFS Securities Total

22 unchanged sentences

On a quarterly basis, we compare the values provided to alternative pricing sources.

Loans held for investment:

We do not record loans at fair value on a recurring basis.

7 unchanged sentences

We may obtain new valuations in certain circumstances, including when there has been significant deterioration in the condition of the collateral, if the foreclosure process has begun, or if the existing valuation is deemed to be outdated.

The following tables list the quantitative information about loans measured at fair value on a nonrecurring basis as of:

September 30, 2025

The following tables list the quantitative information about loans measured at fair value on a nonrecurring basis as of the dates indicated:

March 31, 2026

Valuation Technique Fair Value Unobservable Input Actual Range Weighted Average

1 unchanged sentence

Discounted value $ 4,116 Real Estate 20 % - 25 %

Liquor license 75 % 75 %

Furniture, fixtures & equipment 40 % 40 %

December 31, 2025

2 unchanged sentences

Discounted value $ 4,319 Real Estate 20 % - 25 %

Liquor license 75 % 75 %

Furniture, fixtures & equipment 40 % 40 %

Collateral discount rates may have ranges to accommodate differences in the age of the independent appraisal, broker price opinion, or internal evaluation.

3 unchanged sentences

As such, we classify OMSR subject to nonrecurring fair value adjustments as Level 3.

The following table lists the quantitative information about OMSR fair value measurement as of:

September 30, 2025

The following table lists the quantitative information about OMSR fair value measurement as of the dates indicated:

March 31, 2026

Valuation Technique Fair Value Unobservable Input Rate

11 unchanged sentences

These valuation methods require considerable judgment and the resulting estimates of fair value can be significantly affected by the assumptions made and methods used.

The carrying amount and estimated fair value of financial instruments not recorded at fair value in their entirety on a recurring basis were as follows as of:

September 30, 2025

The carrying amount and estimated fair value of financial instruments not recorded at fair value in their entirety on a recurring basis were as follows as of the dates indicated:

March 31, 2026

Value Estimated

1 unchanged sentence

Cash and cash equivalents $ 50,105 $ 50,105 $ 50,105 $ — $ —

Mortgage loans HFS 360 366 — 366 —

Loans, net 1,544,927 1,509,640 — — 1,509,640

FHLB stock (1)

5,600 N/A — — —

Mortgage loans HFS 737 737 — 737 —

Gross loans 1,431,905 1,395,921 — — 1,395,921

Less allowance for credit losses 13,149 13,149 — — 13,149

Net loans 1,418,756 1,382,772 — — 1,382,772

Accrued interest receivable 9,486 9,486 9,486 — —

12 unchanged sentences

Cash and cash equivalents $ 26,041 $ 26,041 $ 26,041 $ — $ —

Mortgage loans HFS 423 429 — 429 —

Loans, net 1,522,637 1,488,282 — — 1,488,282

FHLB stock (1)

5,600 N/A — — —

Mortgage loans HFS 242 247 — 247 —

Gross loans 1,423,571 1,363,883 — — 1,363,883

Less allowance for credit losses 12,895 12,895 — — 12,895

Net loans 1,410,676 1,350,988 — — 1,350,988

Accrued interest receivable 8,397 8,397 8,397 — —

11 unchanged sentences

Financial Instruments Recorded at Fair Value

The table below presents the recorded amount of assets and liabilities measured at fair value on:

September 30, 2025 December 31, 2024

The table below presents the recorded amount of assets and liabilities measured at fair value on the dates indicated:

March 31, 2026 December 31, 2025

Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3

4 unchanged sentences

Auction rate money market preferred 2,380 — 2,380 — 2,413 — 2,413 —

Mortgage-backed securities 23,397 — 23,397 — 26,886 — 26,886 —

Collateralized mortgage obligations 201,213 — 201,213 — 154,674 — 154,674 —

Agency mortgage-backed securities 20,913 — 20,913 — 22,252 — 22,252 —

Agency collateralized mortgage obligations 238,816 — 238,816 — 200,466 — 200,466 —

Corporate 5,938 — 5,938 — 5,921 — 5,921 —

1 unchanged sentence

Nonrecurring items

Collateral dependent (net of ACL) 3,426 — — 3,426 254 — — 254

OMSR 2,164 — — 2,164 2,185 — — 2,185

Collateral dependent loans (net of ACL) 4,116 — — 4,116 4,319 — — 4,319

Foreclosed assets 573 — — 573 938 — — 938

1 unchanged sentence

Percent of assets and liabilities measured at fair value 0.00 % 99.06 % 0.94 % 0.00 % 98.95 % 1.05 %

We recorded an impairment related to OMSR of $ 1 and $ 3 through earnings for the three and nine month periods ended September 30, 2025, respectively, and $ 21 for each of the three and nine month periods ended September 30, 2024.

We recorded impairments related to foreclosed assets of $ 26 and $ 89 for three and nine month periods ended September 30, 2025, respectively.

No impairments related to foreclosed assets were recorded for three and nine month periods ended September 30, 2024.

We had no other assets or liabilities recorded at fair value with changes in fair value recognized through earnings, on a recurring basis or nonrecurring basis, as of September 30, 2025.

We recorded impairments related to foreclosed assets of $ 0 and $ 63 for the three month periods ended March 31, 2026 and 2025, respectively.

We had no other assets or liabilities recorded at fair value with changes in fair value recognized through earnings, on a recurring basis or nonrecurring basis, as of March 31, 2026.

Further, we had no unrealized gains and losses included in OCI for recurring Level 3 fair value measurements held at the end of the reporting period.

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