What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-08-10 compared with 2026-05-06 · 305 added, 127 removed, 968 unchanged (31% of the section changed)

1 unchanged sentence

INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)

(dollars in thousands) June 30,

2026 December 31,

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

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

Total cash and cash equivalents 50,105 26,041

Cash and cash equivalents $ 41,774 $ 26,041

Marketable securities AFS (amortized cost of $ 450,111 and $ 507,689 , respectively)

24 unchanged sentences

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

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

issued and outstanding 7,628,809 shares at June 30, 2026 and 7,322,207 shares at December 31, 2025

135,079 123,204

6 unchanged sentences

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(Dollars in thousands except per share amounts)

Three Months Ended

June 30 Six Months Ended

(dollars in thousands, except per share amounts) 2026 2025 2026 2025

Interest income

29 unchanged sentences

FDIC insurance premiums 288 267 594 570

Merger-related expenses 505 — 505 —

Other 1,606 1,445 3,115 2,802

9 unchanged sentences

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(Dollars in thousands)

Three Months Ended

June 30 Six Months Ended

(dollars in thousands) 2026 2025 2026 2025

Net income $ 5,041 $ 5,031 $ 10,033 $ 8,980

7 unchanged sentences

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (UNAUDITED)

(Dollars in thousands except per share amounts)

Common Shares

(dollars in thousands, except per share amounts) Common Shares

Outstanding Amount Common Shares to be

3 unchanged sentences

Income (Loss) Totals

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

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

Comprehensive income (loss) — — — 5,031 3,052 8,083

Issuance of common stock 11,498 340 — — — 340

Common stock transferred from the Rabbi Trust to satisfy deferred compensation obligations — 211 ( 211 ) — — —

Share-based payment awards under the Directors Plan — — 34 — — 34

Share-based compensation expense recognized in earnings under the RSP — 14 — — — 14

Common stock repurchased ( 57,824 ) ( 1,505 ) — — — ( 1,505 )

Cash dividends paid ($ 0.28 per common share)

— — — ( 2,022 ) — ( 2,022 )

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

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

Comprehensive income (loss) — — — 5,041 ( 149 ) 4,892

Issuance of common stock 300,594 12,015 — — — 12,015

Common stock transferred from the Rabbi Trust to satisfy deferred compensation obligations — 24 ( 24 ) — — —

Share-based payment awards under the Directors Plan — — 34 — — 34

Share-based compensation expense recognized in earnings under the RSP — 13 — — — 13

Common stock repurchased ( 5,104 ) ( 224 ) — — — ( 224 )

Cash dividends paid ($ 0.28 per common share)

— — — ( 1,987 ) — ( 1,987 )

Ending balance at June 30, 2026 7,628,809 $ 135,079 $ 2,532 $ 119,844 $ ( 8,751 ) $ 248,704

(dollars in thousands, except per share amounts) Common Shares

Outstanding Amount Common Shares to be

Obligations Retained

Earnings Accumulated

Comprehensive

Income (Loss) Totals

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

Comprehensive income (loss) — — — 8,980 6,968 15,948

Issuance of common stock 28,830 759 — — — 759

Common stock issued for deferred compensation under the RSP 11,367 — — — — —

5 unchanged sentences

— — — ( 4,055 ) — ( 4,055 )

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

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

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

Comprehensive income (loss) — — — 10,033 ( 728 ) 9,305

Issuance of common stock 310,276 12,448 — — — 12,448

Common stock transferred from the Rabbi Trust to satisfy deferred compensation obligations — 24 ( 24 ) — — —

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

4 unchanged sentences

— — — ( 4,038 ) — ( 4,038 )

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

Ending balance at June 30, 2026 7,628,809 $ 135,079 $ 2,532 $ 119,844 $ ( 8,751 ) $ 248,704

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

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

Six Months Ended

(dollars in thousands) 2026 2025

Three Months Ended

Operating activities

13 unchanged sentences

Other liabilities ( 381 ) 1,513

Net cash provided by (used in) operating activities 3,778 4,646

Net cash provided by operating activities 11,482 12,425

Investing activities

8 unchanged sentences

Low income housing tax credit investments ( 40 ) ( 3,767 )

Net cash provided by (used in) investing activities ( 18,415 ) 28,158

Net cash provided by investing activities 3,196 15,576

Financing activities

1 unchanged sentence

Net increase (decrease) in short-term borrowings 48,012 ( 10,359 )

Net increase (decrease) in FHLB advances ( 45,000 ) ( 30,000 )

Net (decrease) in FHLB advances ( 45,000 ) ( 30,000 )

Cash dividends paid on common stock ( 4,038 ) ( 4,055 )

1 unchanged sentence

Common stock repurchased ( 626 ) ( 2,650 )

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

Net cash provided by financing activities 1,055 56,011

Increase (decrease) in cash and cash equivalents 15,733 84,012

1 unchanged sentence

Cash and cash equivalents at end of period $ 41,774 $ 108,554

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

(Dollars in thousands)

Supplemental cash flows information

6 unchanged sentences

NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(Dollars in thousands except per share amounts and ratios, unless otherwise noted)

Note 1 – Significant Accounting Policies

7 unchanged sentences

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

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.

Operating results for the three and six-month periods ended June 30, 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 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.

Recent Developments

On June 16, 2026, the Corporation and the Bank entered into an equity distribution agreement with Piper Sandler & Co., as sales agent, pursuant to which the Corporation may offer and sell, from time to time, shares of its common stock with an aggregate gross sales price of up to $ 30.0 million, including through “at-the-market” offerings and other permitted methods.

The sales agent is entitled to a commission of up to 3.0 % of the gross sales price of the common stock sold in such offering.

The Corporation is not obligated to sell any shares of its common stock pursuant to the equity distribution agreement, and may suspend or terminate sales thereunder at any time.

Any shares sold will be issued pursuant to the Corporation’s effective shelf registration statement on Form S-3 and related prospectus supplement, and net proceeds, if any, are expected to be used for general corporate purposes, which may include, without limitation, contribution to the capital of the Bank to support its lending activities and growth.

Please see Note 5 below for additional information about our at-the-market offering.

On June 11, 2026, the Corporation, 401 Merger Sub, Inc., a Michigan corporation and a wholly owned subsidiary of the Corporation (“Merger Sub”), and Grand River Commerce, Inc.

(“Grand River”), entered into an Agreement and Plan of Merger (the “Merger Agreement”).

The Merger Agreement provides that, upon the terms and subject to the conditions set forth therein, Merger Sub will merge with and into Grand River, with Grand River as the surviving entity (the “Merger”), and immediately following the Merger, Grand River will merge with and into the Corporation, with the Corporation as the surviving entity (the “Second Step Merger”).

The Merger Agreement further provides that immediately following the Second Step Merger, Grand River Bank, a Michigan state-chartered member bank and wholly owned subsidiary of Grand River, will merge with and into the Bank, with the Bank as the surviving bank (the “Bank Merger” and, together with the Merger and the Second Step Merger, the “Transaction”).

We expect to complete the Merger in the fourth quarter of 2026, subject to satisfaction of closing conditions, including receipt of customary required regulatory approvals and the approval of the Merger Agreement by the shareholders of Grand River.

Upon the terms and subject to the conditions of the Merger Agreement, at the effective time of the Merger (the “Effective Time”), each voting and non-voting share of common stock of Grand River (“Grand River Common Stock”) issued and outstanding immediately prior to the Effective Time, other than certain shares held by Grand River or the Corporation or dissenting shares, will be converted into the right to receive, at the election of the holder thereof, and subject to adjustment and proration, as applicable, (i) an amount of cash equal to the quotient of (A) $ 18,262,391 (the “Aggregate Cash Consideration”), divided by (B) the product obtained by multiplying (x) the number of shares of Grand River Common Stock issued and outstanding as of the Effective Time by (y) 0.35 (the “Cash Conversion Number”), rounded to the nearest cent (the “Per Share Cash Consideration”), or (ii) the number of shares of common stock of the Corporation, no par value (“Isabella Common Stock”), multiplied by the Exchange Ratio (as defined below).

The Exchange Ratio is defined in the Merger Agreement as a number, as adjusted, of shares of Isabella Common Stock equal to the quotient of (A) 839,003 shares of Isabella Common Stock, divided by (B) the difference of (1) the aggregate number of shares of Grand River Common Stock issued and outstanding immediately prior to the Effective Time, other than certain shares held by Grand River or the Corporation or dissenting shares, minus (2) the Cash Conversion Number, rounded to the nearest ten

thousandth (the “Per Share Stock Consideration”).

The Per Share Cash Consideration and/or the Per Share Stock Consideration are sometimes referred to herein collectively as the “Merger Consideration.”

Merger Consideration elections by Grand River shareholders will be subject to proration procedures whereby 65 % of the shares of Grand River Common Stock will be exchanged for the Per Share Stock Consideration and 35 % of the shares of Grand River common stock will be exchanged for the Per Share Cash Consideration.

Based on the assumption of 9,136,529 shares of Grand River Common Stock issued and outstanding as of the Effective Time, the Per Share Cash Consideration to be paid is estimated to be approximately $ 5.71 and the Exchange Ratio is estimated to be approximately 0.1413 .

At March 31, 2026, Grand River had approximately $ 511.7 million in total assets, $ 433.0 million in total loans and $ 438.9 million in total deposits.

The pro forma company is projected to have approximately $ 2.7 billion in total assets.

Identification and Classification of Merger-Related Expenses

Merger-related expenses are costs incurred directly in connection with merger and acquisition activities and are expensed in the period in which the costs are incurred and services are received.

The costs to issue equity securities associated with the Merger are netted against the value of the securities issued.

Merger-related expenses are expected to include legal fees for negotiation and drafting of merger agreements, accounting and auditing fees related to due diligence and financial statement preparation, consulting fees for strategic advisory services specific to the merger, costs related to regulatory filings and compliance, expenses for integration planning and execution (including IT, systems integration, and contract terminations), severance and retention bonuses for employees affected by the Merger, and travel and accommodation expenses directly related to merger activities.

Merger-related expenses of $ 505,000 recognized in second quarter 2026 primarily include consulting fees and legal fees.

Operating Segments

14 unchanged sentences

Subsequent Events

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.

We evaluated subsequent events after June 30, 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 June 30, 2026 and the date our interim condensed consolidated financial statements were issued.

Pending Accounting Standards

9 unchanged sentences

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

States and political subdivisions 69,332 28 3,026 66,334

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

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

Total $ 503,366 $ 727 $ 11,349 $ 492,744

December 31, 2025

June 30, 2026 December 31, 2025

(dollars in thousands) Amortized

Value Amortized

Treasury $ 100,032 $ — $ 872 $ 99,160 $ 200,327 $ — $ 2,793 $ 197,534

3 unchanged sentences

Agency collateralized mortgage obligations 27,541 — 1,740 25,801 30,312 — 1,518 28,794

Agency commercial mortgage-backed securities 228,036 267 3,188 225,115 172,170 1,149 1,647 171,672

Corporate 6,450 — 339 6,111 6,450 — 529 5,921

1 unchanged sentence

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.

Accrued interest receivable on AFS securities was $ 1.6 million and $ 1.7 million at June 30, 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:

The amortized cost and fair value of AFS securities by contractual maturity as of June 30, 2026 are as follows:

Maturing Securities with Variable Monthly Payments or Noncontractual Maturities

(dollars in thousands) Due in

or Less After One

7 unchanged sentences

Agency collateralized mortgage obligations — — — — 27,541 27,541

Agency commercial mortgage-backed securities 6,871 148,499 72,666 — — 228,036

Corporate — 2,500 3,950 — — 6,450

4 unchanged sentences

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

The information in the following tables pertains to AFS securities with gross unrealized losses as of June 30, 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.

June 30, 2026

Less Than Twelve Months Twelve Months or More

(dollars in thousands) Gross

Treasury $ — $ — $ 872 $ 99,160 $ 872

3 unchanged sentences

Agency collateralized mortgage obligations — — 1,740 25,801 1,740

Agency commercial mortgage-backed securities 1,232 110,180 1,956 82,866 3,188

Corporate — — 339 6,111 339

3 unchanged sentences

Less Than Twelve Months Twelve Months or More

(dollars in thousands) Gross

Treasury $ — $ — $ 2,793 $ 197,534 $ 2,793

3 unchanged sentences

Agency collateralized mortgage obligations — — 1,518 28,794 1,518

Agency commercial mortgage-backed securities 39 9,042 1,608 91,222 1,647

Corporate — — 529 5,921 529

1 unchanged sentence

Number of securities in an unrealized loss position:

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.

As of June 30, 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.

6 unchanged sentences

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

June 30, 2026 December 31, 2025

(dollars in thousands) Balance Percent of Total Balance Percent of Total

Commercial and industrial

29 unchanged sentences

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.

Accrued interest receivable on loans was $ 6.0 million and $ 6.7 million at June 30, 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.

Net unamortized deferred loan costs were $ 2.9 million and $ 3.0 million as of June 30, 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.

Repayment of these loans is dependent upon the successful operation and management of a business.

We minimize our risk by limiting the amount of direct credit exposure to any one borrower to $ 18,000 .

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

We minimize our risk by limiting the amount of direct

credit exposure to any one borrower to $ 18.0 million.

Borrowers with direct credit needs of more than $ 18.0 million 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.

16 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 Bank committees:

Loans in excess of $ 1.5 million require the approval of one or more of the following Bank committees:

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

5 unchanged sentences

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.

There have been no material changes to these policies in 2026.

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

June 30, 2026 December 31, 2025

(dollars in thousands) Total Nonaccrual Loans Nonaccrual Loans with No ACL Total Nonaccrual Loans Nonaccrual Loans with No ACL

Commercial and industrial

3 unchanged sentences

Commercial mortgage 1-4 family investor 3,002 3,002 3,000 3,000

Agricultural mortgage 919 919 — —

Agricultural other 1,948 1,948 — —

Residential real estate

2 unchanged sentences

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

March 31, 2026

June 30, 2026

Accruing Loans 90 or More Days Past Due

(dollars in thousands) 30-59

or More Current Total

25 unchanged sentences

Accruing Loans 90 or More Days Past Due

(dollars in thousands) 30-59

or More Current Total

30 unchanged sentences

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.

There have been no material changes to the risk rating definitions in 2026.

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

June 30, 2026

(dollars in thousands) 2026 2025 2024 2023 2022 Prior Revolving

Loans Revolving Loans Converted to Term Total

30 unchanged sentences

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

March 31, 2026

2026 2025 2024 2023 2022 Prior Revolving

June 30, 2026

(dollars in thousands) 2026 2025 2024 2023 2022 Prior Revolving

Loans Revolving Loans Converted to Term Total

44 unchanged sentences

2026 year-to-date gross charge-offs $ — $ — $ — $ — $ 44 $ — $ — $ — $ 44

March 31, 2026

2026 2025 2024 2023 2022 Prior Revolving

June 30, 2026

(dollars in thousands) 2026 2025 2024 2023 2022 Prior Revolving

Loans Revolving Loans Converted to Term Total

10 unchanged sentences

December 31, 2025

2025 2024 2023 2022 2021 Prior Revolving

(dollars in thousands) 2025 2024 2023 2022 2021 Prior Revolving

Loans Revolving Loans Converted to Term Total

31 unchanged sentences

December 31, 2025

2025 2024 2023 2022 2021 Prior Revolving

(dollars in thousands) 2025 2024 2023 2022 2021 Prior Revolving

Loans Revolving Loans Converted to Term Total

45 unchanged sentences

December 31, 2025

2025 2024 2023 2022 2021 Prior Revolving

(dollars in thousands) 2025 2024 2023 2022 2021 Prior Revolving

Loans Revolving Loans Converted to Term Total

11 unchanged sentences

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

June 30, 2026

(dollars in thousands) 2026 2025 2024 2023 2022 Prior Revolving

Loans Revolving Loans Converted to Term Total

28 unchanged sentences

2026 year-to-date gross charge-offs $ — $ — $ 24 $ 66 $ 14 $ 3 $ — $ — $ 107

March 31, 2026

2026 2025 2024 2023 2022 Prior Revolving

June 30, 2026

(dollars in thousands) 2026 2025 2024 2023 2022 Prior Revolving

Loans Revolving Loans Converted to Term Total

13 unchanged sentences

December 31, 2025

2025 2024 2023 2022 2021 Prior Revolving

(dollars in thousands) 2025 2024 2023 2022 2021 Prior Revolving

Loans Revolving Loans Converted to Term Total

22 unchanged sentences

December 31, 2025

2025 2024 2023 2022 2021 Prior Revolving

(dollars in thousands) 2025 2024 2023 2022 2021 Prior Revolving

Loans Revolving Loans Converted to Term Total

33 unchanged sentences

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

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

Three Months Ended June 30, 2026

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

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

(dollars in thousands) 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 Amortized Cost Basis % of Total Class of Financial Receivable

Commercial and industrial

2 unchanged sentences

Commercial mortgage owner occupied 366 0.15 % 725 0.30 % — 0.00 % — 0.00 % — 0.00 %

Commercial mortgage non-owner occupied — 0.00 % — 0.00 % 5,795 2.59 % — 0.00 % — 0.00 %

Agricultural mortgage 229 0.34 % — 0.00 % — 0.00 % — 0.00 % — 0.00 %

Agricultural other — 0.00 % — 0.00 % 1,350 4.52 % — 0.00 % — 0.00 %

Residential real estate

Senior lien — 0.00 % 85 0.02 % — 0.00 % — 0.00 % — 0.00 %

Total $ 595 $ 961 $ 7,296 $ 50 $ 423

Three Months Ended March 31, 2025

Term Extension

Amortized Cost Basis % of Total Class of Financial Receivable

Six Months Ended June 30, 2026

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

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

Commercial and industrial

2 unchanged sentences

Commercial mortgage owner occupied 367 0.15 % 2,625 1.08 % — 0.00 % — 0.00 % — 0.00 %

Commercial mortgage non-owner occupied — 0.00 % — 0.00 % 5,795 2.59 % — 0.00 % — 0.00 %

Agricultural mortgage 229 0.34 % — 0.00 % — 0.00 % — 0.00 % — 0.00 %

Agricultural other — 0.00 % — 0.00 % 1,350 4.52 % — 0.00 % 1,100 3.69 %

Residential real estate

Senior lien — 0.00 % 85 0.02 % — 0.00 % — 0.00 % — 0.00 %

Total $ 596 $ 2,861 $ 7,306 $ 50 $ 1,523

Three Months Ended June 30, 2025

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

Commercial and industrial

Secured $ 20 0.01 % $ 2,600 1.12 % $ 602 0.26 %

Total $ 20 $ 2,600 $ 602

Six Months Ended June 30, 2025

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

Commercial and industrial

Secured $ 20 0.01 % $ 3,114 1.34 % $ 602 0.26 %

Commercial real estate

Commercial mortgage owner occupied — 0.00 % 1,511 0.85 % — 0.00 %

Total $ 20 $ 4,625 $ 602

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

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.

We had committed to advance $ 3,000 and $ 221,000 in additional funds to be disbursed in connection with modified loans as of June 30, 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)

Three Months Ended June 30

(dollars in thousands) 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)

Commercial and industrial

Secured N/A N/A 3.25 4.4

Secured 2.50 % 7 months 5.16 10.00 % 10 months 0.50

Commercial real estate

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

Agricultural other N/A 5 months 0.47 N/A

Commercial mortgage owner occupied 1.30 % 7 months N/A N/A N/A N/A

Commercial mortgage non-owner occupied N/A N/A 5.00 N/A N/A N/A

Agricultural mortgage 0.75 % N/A N/A N/A N/A N/A

Agricultural other N/A N/A 0.67 N/A N/A N/A

Residential real estate

Senior lien N/A 3 months N/A N/A N/A N/A

Six Months Ended June 30

Commercial and industrial

Secured 2.50 % 7 months 5.13 10.00 % 10 months 1.04

Commercial real estate

Commercial mortgage owner occupied 2.10 % 7 months N/A N/A N/A 15.00

Commercial mortgage non-owner occupied N/A N/A 5.00 N/A N/A N/A

Agricultural mortgage 0.75 % N/A N/A N/A N/A N/A

Agricultural other N/A 6 months 0.53 N/A N/A N/A

Residential real estate

Senior lien N/A 3 months N/A N/A N/A 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 12 months prior to the dates indicated:

March 31, 2026

Current 30-59 Days

June 30, 2026

(dollars in thousands) Current 30-59 Days

Past Due 60-89 Days

5 unchanged sentences

Commercial mortgage owner occupied 2,992 — — — 2,992

Commercial mortgage non-owner occupied 5,795 — — — 5,795

Agricultural mortgage 563 855 — — 1,418

3 unchanged sentences

Total $ 11,564 $ 1,955 $ 776 $ 85 $ 14,380

March 31, 2025

Current 30-59 Days

June 30, 2025

(dollars in thousands) Current 30-59 Days

Past Due 60-89 Days

8 unchanged sentences

Total $ 6,897 $ 99 $ — $ — $ 6,996

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

The following table summarizes the amortized cost basis of loans that defaulted in the three and six-month periods ended June 30, 2026 and were modified within 12 months prior to the default date.

There were no loans that defaulted in the three and six-month period ended June 30, 2025 and were modified within 12 months prior to the default date.

Modified loans, including those that have defaulted, are already included in the allowance for credit losses through the various methodologies used to estimate the allowance.

As such, no modification to the allowance is recorded specifically due to a modified loan subsequently defaulting.

Three Months Ended June 30, 2026 Six Months Ended June 30, 2026

(dollars in thousands) Other-Than-Insignificant Payment Delay Term Extension Other-Than-Insignificant Payment Delay and Term Extension Other-Than-Insignificant Payment Delay Term Extension Other-Than-Insignificant Payment Delay and Term Extension

Commercial and industrial

Secured $ — $ — $ — $ — $ — $ 423

Agricultural mortgage 855 — — 855 — —

Agricultural other — 776 1,100 — 776 1,100

Residential real estate

11 unchanged sentences

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.

There have been no material changes to the ACL methodology in 2026.

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

Three Months Ended June 30, 2026

(dollars in thousands) Commercial and Industrial Commercial Real Estate Agricultural Residential Real Estate Consumer Total

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

Charge-offs ( 45 ) ( 231 ) ( 102 ) — ( 185 ) ( 563 )

Recoveries 11 8 5 61 94 179

Provision for (reversal of) credit losses 70 664 67 20 28 849

June 30, 2026 $ 1,182 $ 6,663 $ 270 $ 5,229 $ 1,135 $ 14,479

Six Months Ended June 30, 2026

(dollars in thousands) Commercial and Industrial Commercial Real Estate Agricultural Residential Real Estate Consumer Total

December 31, 2025 $ 1,136 $ 5,949 $ 327 $ 5,059 $ 1,256 $ 13,727

2 unchanged sentences

Provision for (reversal of) credit losses 79 1,070 40 95 105 1,389

June 30, 2026 $ 1,182 $ 6,663 $ 270 $ 5,229 $ 1,135 $ 14,479

Three Months Ended June 30, 2025

(dollars in thousands) Commercial and Industrial Commercial Real Estate Agricultural Residential Real Estate Consumer Total

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

Three Months Ended March 31, 2025

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

Charge-offs ( 72 ) — — — ( 318 ) ( 390 )

Recoveries 4 50 — 16 1,752 1,822

Provision for (reversal of) credit losses 147 53 50 57 ( 1,497 ) ( 1,190 )

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

Six Months Ended June 30, 2025

(dollars in thousands) Commercial and Industrial Commercial Real Estate Agricultural Residential Real Estate Consumer Total

December 31, 2024 $ 1,316 $ 5,171 $ 287 $ 4,521 $ 1,600 $ 12,895

2 unchanged sentences

Provision for (reversal of) credit losses ( 10 ) 54 29 123 ( 1,598 ) ( 1,402 )

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

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

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

(dollars in thousands) June 30,

2026 March 31,

2026 December 31,

2025 September 30,

2025 March 31

2025 June 30,

Individually evaluated $ 199 $ 227 $ 259 $ — $ —

5 unchanged sentences

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

June 30, 2026 December 31, 2025

(dollars in thousands) Loan Balance Specific Allocation Loan Balance Specific Allocation

Commercial and industrial $ 573 $ 74 $ 442 $ 95

7 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 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.

Loans evaluated for expected credit losses on an individual basis as of June 30, 2026 include $ 7.6 million in collateral dependent loans secured by commercial real estate, agricultural real estate and equipment, commercial equipment, and residential real estate of $ 3.7 million, $ 2.7 million, $ 573,000 , and $ 572,000 , respectively.

Note 4 – Borrowed Funds

2 unchanged sentences

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

Three Months Ended June 30

(dollars in thousands) 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 $ 116,012 $ 115,347 3.46 % $ 43,208 $ 40,802 3.14 %

1 unchanged sentence

FRB Discount Window — 275 3.75 % — 859 4.50 %

Six Months Ended June 30

Securities sold under agreements to repurchase without stated maturity dates $ 116,012 $ 101,127 3.44 % $ 47,310 $ 42,150 3.18 %

Federal funds purchased — 1 4.67 % — 11 5.43 %

FRB Discount Window 3,700 250 3.14 % — 446 4.50 %

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 $ 139,962 and $ 87,752 as of March 31, 2026 and December 31, 2025, respectively.

The securities underlying the agreements have a carrying value and a fair value of $ 143.6 million and $ 87.8 million as of June 30, 2026 and December 31, 2025, respectively.

Such securities remain under our control.

1 unchanged sentence

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

June 30, 2026 December 31, 2025

(dollars in thousands) Amount Rate Amount Rate

Securities sold under agreements to repurchase without stated maturity dates $ 116,012 3.49 % $ 68,000 3.45 %

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

(dollars in thousands) June 30,

2026 December 31,

4 unchanged sentences

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

(dollars in thousands) June 30,

2026 December 31,

5 unchanged sentences

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

As of June 30, 2026, we had the ability to borrow up to an additional $ 403.0 million without pledging additional collateral.

FHLB advances

1 unchanged sentence

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 2026 $ — N/A $ 45,000 3.92 %

June 30, 2026 December 31, 2025

(dollars in thousands) Amount Rate Amount Rate

Fixed rate due 2026 $ — 0.00 % $ 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 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.

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

The Notes initially had 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.

As of June 15, 2026, the Notes are redeemable by us at any time at our option, in whole or in part.

The Notes are not subject to redemption at the option of the holders.

1 unchanged sentence

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

March 31, 2026 December 31, 2025

Amount Rate Amount Rate

June 30, 2026 December 31, 2025

(dollars in thousands) Amount Rate Amount Rate

Fixed rate at 3.25 % to floating, due 2031

6 unchanged sentences

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.

Pursuant to the Corporation’s at-the-market offering, we issued and sold 303,371 shares of common stock during the six months ended June 30, 2026, increasing equity by $ 11.7 million as of June 30, 2026.

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

Three Months Ended

June 30 Six Months Ended

(dollars in thousands, except per share amounts) 2026 2025 2026 2025

Average number of common shares outstanding for basic calculation 7,330,929 7,383,338 7,324,794 7,400,370

6 unchanged sentences

Note 6 – Capital Ratios and Shareholders' Equity

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.

As of June 30, 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.

3 unchanged sentences

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

June 30, 2026

Actual Minimum Capital

2 unchanged sentences

Well Capitalized (1)

Amount Ratio Amount Ratio Amount Ratio

(dollars in thousands) Amount Ratio Amount Ratio Amount Ratio

Common equity Tier 1 capital to risk weighted assets

15 unchanged sentences

Well Capitalized (1)

Amount Ratio Amount Ratio Amount Ratio

(dollars in thousands) Amount Ratio Amount Ratio Amount Ratio

Common equity Tier 1 capital to risk weighted assets

14 unchanged sentences

There are no significant regulatory constraints placed on our capital.

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

As of June 30, 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.

1 unchanged sentence

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

Three Months Ended March 31

Three Months Ended June 30

(dollars in thousands) Unrealized

Securities Defined

2 unchanged sentences

Pension Plan Total

Balance, December 31 $ ( 7,985 ) $ ( 38 ) $ ( 8,023 ) $ ( 20,958 ) $ ( 397 ) $ ( 21,355 )

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

OCI before reclassifications ( 200 ) — ( 200 ) 3,879 — 3,879

1 unchanged sentence

OCI, net of tax ( 149 ) — ( 149 ) 3,052 — 3,052

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.

June 30 $ ( 8,713 ) $ ( 38 ) $ ( 8,751 ) $ ( 13,990 ) $ ( 397 ) $ ( 14,387 )

Six Months Ended June 30

(dollars in thousands) Unrealized

Securities Defined

Pension Plan Total Unrealized

Securities Defined

Pension Plan Total

December 31 $ ( 7,985 ) $ ( 38 ) $ ( 8,023 ) $ ( 20,958 ) $ ( 397 ) $ ( 21,355 )

OCI before reclassifications ( 924 ) — ( 924 ) 8,893 — 8,893

Tax effect 196 — 196 ( 1,925 ) — ( 1,925 )

OCI, net of tax ( 728 ) — ( 728 ) 6,968 — 6,968

June 30 $ ( 8,713 ) $ ( 38 ) $ ( 8,751 ) $ ( 13,990 ) $ ( 397 ) $ ( 14,387 )

Included in OCI for the three and six-month periods ended June 30, 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 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

Three Months Ended June 30

(dollars in thousands) 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 $ 39 $ ( 239 ) $ ( 200 ) $ ( 64 ) $ 3,943 $ 3,879

1 unchanged sentence

Unrealized gains (losses), net of tax $ 39 $ ( 188 ) $ ( 149 ) $ ( 64 ) $ 3,116 $ 3,052

Six Months Ended June 30

(dollars in thousands) 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 $ 6 $ ( 930 ) $ ( 924 ) $ ( 279 ) $ 9,172 $ 8,893

Tax effect — 196 196 — ( 1,925 ) ( 1,925 )

Unrealized gains (losses), net of tax $ 6 $ ( 734 ) $ ( 728 ) $ ( 279 ) $ 7,247 $ 6,968

Note 7 – Revenue

Our revenue is comprised primarily of interest income, service charges and fees, gains on the sale of loans and AFS securities, earnings on corporate owned life insurance policies, and other noninterest income.

Other noninterest income is typically service and performance driven in nature and comprised primarily of investment and trust advisory fees.

We recognize revenue, excluding interest income, in accordance with ASC 606, Revenue From Contracts with Customers.

Revenue is recognized when our performance obligation has been satisfied according to our contractual obligation.

We record receivables when revenue is unpaid and collectability is reasonably assured.

Accounts receivable balances primarily represent amounts due from customers for which revenue has been recognized.

Accounts receivable balances are recorded in the consolidated balance sheets in other assets.

For the three and six month periods ended June 30, 2026 and 2025, we satisfied our performance obligations pursuant to contracts with customers.

As a result, we have not recorded any contract assets or liabilities.

We estimate no returns or allowances for the three and six month periods ended June 30, 2026 and 2025.

Our contracts with customers define our performance obligations with clearly established pricing which did not require us to allocate or disaggregate revenue by performance obligation.

A summary of revenue recognized for each major category of contracts with customers, subject to ASC 606, is as follows for the periods indicated:

Three Months Ended

June 30 Six Months Ended

(dollars in thousands) 2026 2025 2026 2025

Debit card income $ 1,198 $ 995 $ 2,306 $ 1,977

Trust service fees 1,019 913 1,885 1,726

Customer overdraft fees 600 532 1,161 1,076

Service charges and fees related to deposit accounts 348 176 706 341

ATM income 294 278 544 507

Investment advisory fees 197 171 439 337

Other 152 134 305 235

A significant portion of our revenue consists of interest income which is not subject to the requirements set forth in ASC 606.

Note 8 – Fair Value

29 unchanged sentences

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

(dollars in thousands) June 30, 2026

Valuation Technique Fair Value Unobservable Input Actual Range Weighted Average

1 unchanged sentence

Discounted value $ 7,361 Real Estate 20 % - 25 %

Equipment 30 % - 35 %

Cash crop inventory 40 % 40 %

Liquor license 75 % 75 %

Furniture, fixtures & equipment 40 % 40 %

December 31, 2025

(dollars in thousands) December 31, 2025

Valuation Technique Fair Value Unobservable Input Actual Range Weighted Average

9 unchanged sentences

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

March 31, 2026

(dollars in thousands) June 30, 2026

Valuation Technique Fair Value Unobservable Input Rate

1 unchanged sentence

Discount rate 11 %

December 31, 2025

(dollars in thousands) December 31, 2025

Valuation Technique Fair Value Unobservable Input Rate

8 unchanged sentences

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

June 30, 2026

(dollars in thousands) Carrying

Value Estimated

16 unchanged sentences

December 31, 2025

(dollars in thousands) Carrying

Value Estimated

15 unchanged sentences

Accrued interest payable 1,059 1,059 1,059 — —

(1) Due to the characteristics of equity securities without readily determinable fair values, they are not disclosed under a specific fair value hierarchy.

(1) Due to the characteristics of FHLB stock and equity securities without readily determinable fair values, they are not disclosed under a specific fair value hierarchy.

When an impairment or write-down related to these securities is recorded, such amount would be classified as a nonrecurring Level 3 fair value adjustment.

1 unchanged sentence

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

June 30, 2026 December 31, 2025

(dollars in thousands) Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3

Recurring items

5 unchanged sentences

Agency collateralized mortgage obligations 25,801 — 25,801 — 28,794 — 28,794 —

Agency commercial mortgage-backed securities 225,115 — 225,115 — 171,672 — 171,672 —

Corporate 6,111 — 6,111 — 5,921 — 5,921 —

2 unchanged sentences

Collateral dependent loans (net of ACL) 7,361 — — 7,361 4,319 — — 4,319

OMSR 2,239 — — 2,239 2,090 — — 2,090

Foreclosed assets 620 — — 620 938 — — 938

1 unchanged sentence

Percent of assets and liabilities measured at fair value 0.00 % 97.73 % 2.27 % 0.00 % 98.55 % 1.45 %

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.

We recorded an impairment related to OMSR of $ 2,000 through earnings for each of the three and six month periods ended June 30, 2025.

No impairments related to OMSR were recorded for the three and six periods ended June 30, 2026.

We recorded impairments related to foreclosed assets of $ 0 and $ 63,000 for the three and six month periods ended June 30, 2025.

No impairments related to foreclosed assets were recorded for the three and six periods ended June 30, 2026.

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 June 30, 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