MID PENN BANCORP INC 10-Q

ITEM 1 – FINANCIAL STATEMENTS CONSOLIDATED BALANCE SHEETS (UNAUDITED) (In thousands, except per share data) March 31, 2025 December 31, 2024 ASSETS Cash and due from banks $ 47,688 $ 37,002 Interest-bearing balances with other financial institutions 16,880 14,490 Federal funds sold 42,686 19,072 Total cash and cash equivalents 107,254 70,564 Investment securities: HTM, at amortized cost (fair value $ 339,708 and $ 340,648 , respectively) 375,115 382,447 AFS, at fair value (amortized cost $ 278,158 and $ 284,770 , respectively) 258,493 260,477 Equity securities, at fair value 436 428 Loans held for sale, at fair value 6,851 7,064 Loans, net of unearned income 4,491,167 4,443,070 Less: ACL - Loans ( 35,838 ) ( 35,514 ) Net loans 4,455,329 4,407,556 Premises and equipment, net 40,328 38,806 Operating lease right of use asset 9,402 7,699 Finance lease right of use asset 2,503 2,548 Cash surrender value of life insurance 51,351 51,521 Restricted investment in bank stocks 6,660 7,461 Accrued interest receivable 27,263 26,846 Deferred income taxes 21,800 22,747 Goodwill 128,160 128,160 Core deposit and other intangibles, net 5,814 6,242 Foreclosed assets held for sale 1,402 44 Other assets 47,865 50,326 Total Assets $ 5,546,026 $ 5,470,936 LIABILITIES & SHAREHOLDERS’ EQUITY Deposits: Noninterest-bearing demand $ 788,316 $ 759,169 Interest-bearing transaction accounts 2,375,205 2,319,753 Time 1,568,681 1,611,005 Total Deposits 4,732,202 4,689,927 Short-term borrowings 25,000 2,000 Long-term debt 23,489 23,603 Subordinated debt 45,587 45,741 Operating lease liability 9,765 8,092 Accrued interest payable 12,900 13,484 Other liabilities 29,150 33,071 Total Liabilities 4,878,093 4,815,918 Shareholders' Equity: Common stock, par value $ 1.00 per share; 40,000,000 shares authorized at March 31, 2025 and December 31, 2024; 19,802,816 issued at March 31, 2025 and 19,796,519 at December 31, 2024; 19,362,094 outstanding at March 31, 2025 and 19,355,797 at December 31, 2024 19,803 19,797 Additional paid-in capital 480,866 480,491 Retained earnings 191,469 181,597 Accumulated other comprehensive loss ( 14,163 ) ( 16,825 ) Treasury stock, at cost; 440,722 shares at March 31, 2025 and December 31, 2024. ( 10,042 ) ( 10,042 ) Total Shareholders’ Equity 667,933 655,018 Total Liabilities and Shareholders' Equity $ 5,546,026 $ 5,470,936 The accompanying notes are an integral part of these unaudited consolidated financial statements. 4 Table of Contents MID PENN BANCORP, INC. CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) Three Months Ended March 31, (In thousands, except per share data) 2025 2024 INTEREST INCOME Loans, including fees $ 66,537 $ 63,236 Investment securities: Taxable 4,460 4,040 Tax-exempt 348 376 Other interest-bearing balances 138 403 Federal funds sold 261 136 Total Interest Income 71,744 68,191 INTEREST EXPENSE Deposits 28,264 26,332 Short-term borrowings 290 4,446 Long-term and subordinated debt 681 957 Total Interest Expense 29,235 31,735 Net Interest Income 42,509 36,456 Provision/(benefit) for credit losses - loans 321 ( 619 ) Benefit for credit losses - credit commitments ( 20 ) ( 318 ) Net provision/(benefit) for credit losses 301 ( 937 ) Net Interest Income After Provision/Benefit for Credit Losses 42,208 37,393 NONINTEREST INCOME Fiduciary and wealth management 1,140 1,132 ATM debit card interchange 919 945 Service charges on deposits 562 509 Mortgage banking 591 424 Mortgage hedging ( 9 ) — Net gain on sales of SBA loans 57 107 Earnings from cash surrender value of life insurance 274 284 Other 1,705 2,436 Total Noninterest Income 5,239 5,837 NONINTEREST EXPENSE Salaries and employee benefits 16,309 15,462 Software licensing and utilization 2,574 2,120 Occupancy, net 2,274 1,982 Equipment 1,094 1,222 Shares tax 919 997 Legal and professional fees 826 998 ATM/card processing 733 534 Intangible amortization 428 428 FDIC Assessment 990 945 Gain on sale of foreclosed assets, net ( 28 ) — Merger and acquisition 314 — Other 4,209 3,832 Total Noninterest Expense 30,642 28,520 INCOME BEFORE PROVISION FOR INCOME TAXES 16,805 14,710 Provision for income taxes 3,063 2,577 NET INCOME AVAILABLE TO COMMON SHAREHOLDERS $ 13,742 $ 12,133 PER COMMON SHARE DATA: Basic Earnings Per Common Share $ 0.71 $ 0.73 Diluted Earnings Per Common Share $ 0.71 $ 0.73 Weighted-average basic shares outstanding 19,355,867 16,567,902 Weighted-average diluted shares outstanding 19,416,265 16,613,373 The accompanying notes are an integral part of these unaudited consolidated financial statements. 5 Table of Contents MID PENN BANCORP, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) Three Months Ended March 31, (In Thousands) 2025 2024 Net income $ 13,742 $ 12,133 Other comprehensive income/(loss): Unrealized gains/(losses) arising during the period on available for sale securities, net of income tax. 3,656 ( 1,711 ) Unrealized holding (losses)/gains arising during the period on interest rate derivatives used in cash flow hedges, net of income tax. ( 984 ) 1,410 Change in defined benefit plans, net of income tax. (1) 16 8 Reclassification adjustment for settlement gains and activity related to benefit plans, net of income tax. (2) ( 26 ) ( 17 ) Total other comprehensive income/(loss) 2,662 ( 310 ) Total comprehensive income $ 16,404 $ 11,823 (1) The change in defined benefit plans consists primarily of unrecognized actuarial gains on defined benefit plans during the period. (2) The reclassification adjustment for benefit plans includes settlement gains, amortization of prior service costs, and amortization of net gain or loss. Amounts are included in other income on the Consolidated Statements of Income within total noninterest income. The accompanying notes are an integral part of these unaudited consolidated financial statements. 6 Table of Contents MID PENN BANCORP, INC. CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (UNAUDITED) Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive (Loss) Income Treasury Stock Total Shareholders' Equity (In thousands, except per share data) Shares Amount Balance, January 1, 2025 19,796,519 $ 19,797 $ 480,491 $ 181,597 $ ( 16,825 ) $ ( 10,042 ) $ 655,018 Net income — — — 13,742 — — 13,742 Total other comprehensive income — — — — 2,662 — 2,662 Common stock cash dividends declared, $ 0.20 per share — — — ( 3,870 ) — — ( 3,870 ) Repurchased stock — — — — — — — Employee Stock Purchase Plan 5,311 5 132 — — — 137 Director Stock Purchase Plan 986 1 25 — — — 26 Restricted stock activity — — 218 — — — 218 Balance, March 31, 2025 19,802,816 $ 19,803 $ 480,866 $ 191,469 $ ( 14,163 ) $ ( 10,042 ) $ 667,933 Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Total Shareholders' Equity (In thousands, except per share data) Shares Amount Balance, January 1, 2024 16,998,929 $ 16,999 $ 405,725 $ 145,982 $ ( 16,637 ) $ ( 9,719 ) $ 542,350 Net income — — — 12,133 — — 12,133 Total other comprehensive income — — — — ( 310 ) — ( 310 ) Common stock cash dividends declared, $ 0.20 per share — — — ( 3,314 ) — — ( 3,314 ) Repurchased stock — — — — — ( 323 ) ( 323 ) Employee Stock Purchase Plan 5,653 5 107 — — — 112 Director Stock Purchase Plan 1,777 2 34 — — — 36 Restricted stock activity — — 284 — — — 284 Balance, March 31, 2024 17,006,359 $ 17,006 $ 406,150 $ 154,801 $ ( 16,947 ) $ ( 10,042 ) $ 550,968 The accompanying notes are an integral part of these unaudited consolidated financial statements. 7 Table of Contents MID PENN BANCORP, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) Three Months Ended March 31, (In thousands) 2025 2024 Operating Activities: Net Income $ 13,742 $ 12,133 Adjustments to reconcile net income to net cash provided by operating activities: Provision/(benefit) for credit losses 301 ( 937 ) Depreciation 1,133 1,192 Amortization of intangibles 428 428 Net amortization of security discounts/premiums 70 102 Noncash operating lease expense 619 539 Amortization of finance lease right of use asset 45 44 Earnings on cash surrender value of life insurance ( 274 ) ( 284 ) Mortgage loans originated for sale ( 20,566 ) ( 16,808 ) Proceeds from sales of mortgage loans originated for sale 21,370 16,506 Gain on sale of mortgage loans ( 591 ) ( 424 ) SBA loans originated for sale ( 728 ) ( 1,553 ) Proceeds from sales of SBA loans originated for sale 785 1,446 Gain on sale of SBA loans ( 57 ) ( 107 ) Gain on sale of property, plant, and equipment — ( 32 ) Gain on sale or write-down of foreclosed assets ( 28 ) — Accretion of subordinated debt ( 154 ) ( 153 ) Stock compensation expense 218 284 Change in deferred income tax cost 206 1,402 Increase accrued interest receivable ( 417 ) ( 1,155 ) Decrease/(Increase) in other assets 822 ( 3,484 ) (Decrease)/Increase in accrued interest payable ( 584 ) 2,073 Decrease in operating lease liability ( 649 ) ( 602 ) (Decrease)/Increase in other liabilities ( 4,162 ) 1,799 Net Cash Provided By Operating Activities 11,529 12,409 Investing Activities: Proceeds from the maturity or call of available-for-sale securities 6,609 3,741 Proceeds from the maturity or call of held-to-maturity securities 7,265 2,045 Stock dividends of FHLB and other bank stock 151 239 Reduction (Purchases) of restricted investment in bank stock 650 ( 917 ) Net increase in loans ( 49,476 ) ( 68,987 ) Purchases of bank premises and equipment ( 2,720 ) ( 351 ) Proceeds from the sale of premises and equipment 65 32 Proceeds from the sale of foreclosed assets 72 — Proceeds from bank-owned life insurance 527 — Gain on bank-owned life insurance ( 83 ) — Net change in investments in tax credits and other partnerships 647 ( 1,548 ) Net Cash Used in Investing Activities ( 36,293 ) ( 65,746 ) 8 Table of Contents MID PENN BANCORP, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)(CONTINUED) Financing Activities: Net increase in deposits 42,275 32,893 Common stock dividends paid ( 3,870 ) ( 3,314 ) Proceeds from Employee and Director Stock Purchase Plan stock issuance 163 148 Treasury stock purchased — ( 323 ) Net change in finance lease liability ( 36 ) ( 24 ) Net change in short-term borrowings 23,000 30,317 Long-term debt repayment ( 78 ) ( 35,038 ) Net Cash Provided by Financing Activities 61,454 24,659 Net increase/(decrease) in cash and cash equivalents 36,690 ( 28,678 ) Cash and cash equivalents, beginning of period 70,564 96,763 Cash and cash equivalents, end of period $ 107,254 $ 68,085 Supplemental Disclosures of Cash Flow Information: Cash paid for interest $ 29,819 $ 29,662 Cash paid for income taxes 185 — Supplemental Noncash Disclosures: Recognition of operating lease right of use assets $ 2,322 $ — Recognition of operating lease liabilities 2,322 — Loans transferred to foreclosed assets held for sale 1,402 4,817 The accompanying notes are an integral part of these unaudited consolidated financial statements. 9 Table of Contents MID PENN BANCORP, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Note 1 - Summary of Significant Accounting Policies Nature of Operations Mid Penn Bancorp, Inc. ("Mid Penn" or the "Corporation"), through operations conducted by Mid Penn Bank (the "Bank") and its nonbank subsidiaries, engages in a full-service commercial banking and trust business, making available to the community a wide range of financial services, including, but not limited to, mortgage and home equity loans, secured and unsecured commercial and consumer loans, lines of credit, construction financing, farm loans, community development loans, loans to non-profit entities and local government loans, and various types of time and demand deposits including but not limited to, checking accounts, savings accounts, clubs, money market deposit accounts, certificates of deposit, and Individual Retirement Accounts. In addition, the Bank provides a full range of trust and wealth management services through its Trust Department. Deposits are insured by the Federal Deposit Insurance Corporation ("FDIC") to the extent provided by law. Mid Penn also fulfills the insurance needs of both existing and potential customers through MPB Risk Services, LLC, doing business as MPB Insurance and Risk Management. The financial services are provided to individuals, partnerships, non-profit organizations, and corporations through its retail banking offices located throughout Pennsylvania and three counties in New Jersey. Basis of Presentation For all periods presented, the accompanying consolidated financial statements include the accounts of Mid Penn Bancorp, Inc., its wholly-owned subsidiary, Mid Penn Bank, and five wholly-owned nonbank subsidiaries, MPB Realty, LLC, MPB Financial Services, LLC, which includes MPB Wealth Management, LLC (which ceased operating during the first quarter of 2024), MPB Risk Services, LLC, and MPB Launchpad Fund I, LLC. As of March 31, 2025, the accounts and activities of these nonbank subsidiaries were not material to warrant separate disclosure or segment reporting. As a result, Mid Penn has only one reportable segment for financial reporting purposes. All material intercompany accounts and transactions have been eliminated in consolidation. Certain information and disclosures normally included in consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC. Mid Penn believes the information presented is not misleading, and the disclosures are adequate. For comparative purposes, the March 31, 2024 and December 31, 2024 balances have been reclassified, when necessary, to conform to the 2025 presentation. Such reclassifications had no impact on net income or total shareholders’ equity. In the opinion of management, all adjustments necessary for fair presentation of the periods presented have been reflected in the accompanying consolidated financial statements. All such adjustments are of a normal, recurring nature. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the 2024 Annual Report. Subsequent Events Mid Penn has evaluated events and transactions occurring subsequent to the balance sheet date of March 31, 2025 for items that should potentially be recognized or disclosed in these consolidated financial statements. The evaluation was conducted through the issuance date of these consolidated financial statements. On April 30, 2025, Mid Penn completed its acquisition of William Penn Bancorporation through the merger of William Penn with and into Mid Penn. The Merger was completed in accordance with the terms and conditions of the Agreement and Plan of Merger dated October 31, 2024, between Mid Penn and William Penn. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could materially differ from those estimates. Material estimates subject to significant change include the allowance for credit losses, the expected cash flows and collateral values associated with loans that are individually evaluated for credit losses, the carrying value of other real 10 Table of Contents MID PENN BANCORP, INC. estate owned ("OREO"), the fair value of financial instruments, business combination fair value computations, the valuation of goodwill and other intangible assets, stock-based compensation and deferred income tax assets. Accounting Standards adopted and Updated Significant Accounting Policy Accounting Standards Pending Adoption ASU 2023-06: The FASB issued ASU 2023-06, Disclosure Improvements - Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative . ASU 2023-06 amends the ASC to incorporate certain disclosure requirements from SEC Release No. 33-10532 - Disclosure Update and Simplification that was issued in 2018. The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. ASU 2023-06 is not expected to have a significant impact on the Corporation's financial statements. ASU 2023-09 : The FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 amends the ASC to enhance income tax disclosures by requiring entities to disclose income taxes paid (net of refunds received) disaggregated by federal, state and foreign taxes. Additionally, entities are required to disclose amounts greater than 5% of the total income taxes paid to an individual jurisdiction The amendments are effective for annual periods beginning after December 15, 2024. ASU 2023-09 is not expected to have a significant impact on the Corporation's financial statements. ASU 2024-01 —The FASB issued ASU 2024-01, Compensation - Stock Compensation (Topic 718): Scope application of profits interest and similar awards. The amendments in the ASU apply to all reporting entities that account for profits interest awards as compensation to employees or nonemployees in return for goods or services. The amendments are effective for annual periods beginning after December 15, 2025, and interim periods within those annual periods. ASU 2024-01 is not expected to have a significant impact on the Corporation's financial statements. ASU 2024-02 : The FASB issued ASU 2024-02, Codification Improvements—Amendments to Remove References to the Concepts Statements. This ASU contains amendments to the Codification that remove references to various FASB Concepts Statements. The amendments are effective for fiscal years beginning after December 15, 2025. Early adoption is permitted. ASU 2024-02 is not expected to have a significant impact on the Corporation's financial statements. ASU 2024-03 : The FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses The amendments in the ASU improve financial reporting by requiring that public business entities disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods. The amendments are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. ASU 2024-03 is not expected to have a significant impact on the Corporation's financial statements. ASU 2024-04: The FASB issued ASU 2024-04, Debt—Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments The amendments in the ASU clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. The amendments in the ASU are effective for all entities for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted for all entities that have adopted the amendments in ASU 2020-06. ASU 2024-04 is not expected to have a significant impact on the Corporation's financial statements. 11 Table of Contents MID PENN BANCORP, INC. ASU 2025-01 - The FASB issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date The amendments in the ASU clarify the effective date of ASU 2024-03 which requires public business entities to disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods. The amendments in the ASU are effective for the first annual reporting period beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. ASU 2025-01 is not expected to have a significant impact on the Corporation's financial statements. 12 Table of Contents MID PENN BANCORP, INC. Note 2 - Business Combinations Commonwealth Benefits Group Acquisition On July 31, 2024, Mid Penn acquired the insurance business and related accounts of a full-service employee benefits firm that serves mid to large employers across central and eastern Pennsylvania, northern Maryland, and northern Virginia, for a purchase price of $ 2.0 million at closing and an additional $ 800 thousand potentially payable pursuant to a three year earnout. Mid Penn has recognized total goodwill of $ 1.1 million, which is calculated as the excess of both the consideration exchanged and liabilities assumed compared to the fair market value of identifiable assets acquired. 13 Table of Contents MID PENN BANCORP, INC. Note 3 - Investment Securities AFS Securities At March 31, 2025, the fair value of AFS securities totaled $ 258.5 million. At March 31, 2025, no securities were identified that violated credit loss triggers; therefore, no DCF analysis was performed, and no credit loss was recognized on any of the securities available for sale. Accrued interest receivable is excluded from the estimate of credit losses for AFS securities. At March 31, 2025, accrued interest receivable totaled $ 1.1 million for AFS securities, and was reported in accrued interest receivable on the accompanying Consolidated Balance Sheet. HTM Securities At March 31, 2025, Mid Penn’s HTM securities totaled $ 375.1 million. The Company primarily held highly rated HTM securities, including taxable and tax-exempt securities issued mainly by the U.S government, state governments, and political subdivisions. As of March 31, 2025, the majority of Mid Penn's HTM securities were rated as A1/BBB by Moody's and/or Standard & Poor's ratings services. Credit ratings of HTM securities, which are a key factor in estimating expected credit losses, are reviewed on a quarterly basis. At March 31, 2025, Mid Penn had no HTM securities that were past due 30 days or more as to principal or interest payments. Mid Penn had no HTM securities classified as nonaccrual at March 31, 2025. Therefore, no allowance for credit losses was recorded as of March 31, 2025. Accrued interest receivable is excluded from the estimate of credit losses for HTM securities. At March 31, 2025, accrued interest receivable totaled $ 2.2 million for HTM securities and was reported in accrued interest receivable on the accompanying Consolidated Balance Sheet. The following tables set forth the amortized cost and estimated fair value of investment securities for the periods presented: March 31, 2025 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale U.S. Treasury and U.S. government agencies $ 22,273 $ — $ 516 $ 21,757 Mortgage-backed U.S. government agencies 215,826 289 16,008 200,107 State and political subdivision obligations 4,305 — 710 3,595 Corporate debt securities 35,754 35 2,755 33,034 Total available-for-sale debt securities 278,158 324 19,989 258,493 Held-to-maturity U.S. Treasury and U.S. government agencies $ 237,976 $ — $ 22,952 $ 215,024 Mortgage-backed U.S. government agencies 36,275 1 4,703 31,573 State and political subdivision obligations 75,418 — 6,633 68,785 Corporate debt securities 25,446 — 1,120 24,326 Total held-to-maturity debt securities 375,115 1 35,408 339,708 Total $ 653,273 $ 325 $ 55,397 $ 598,201 14 Table of Contents MID PENN BANCORP, INC. December 31, 2024 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale U.S. Treasury and U.S. government agencies $ 22,247 $ — $ 740 $ 21,507 Mortgage-backed U.S. government agencies 222,464 11 19,531 202,944 State and political subdivision obligations 4,309 — 713 3,596 Corporate debt securities 35,750 — 3,320 32,430 Total available-for-sale debt securities $ 284,770 $ 11 $ 24,304 $ 260,477 Held-to-maturity U.S. Treasury and U.S. government agencies $ 241,941 $ — $ 28,133 $ 213,808 Mortgage-backed U.S. government agencies 37,593 — 5,508 32,085 State and political subdivision obligations 77,462 — 6,840 70,622 Corporate debt securities 25,451 — 1,318 24,133 Total held-to-maturity debt securities 382,447 — 41,799 340,648 Total $ 667,217 $ 11 $ 66,103 $ 601,125 Estimated fair values of debt securities are based on quoted market prices, where applicable. If quoted market prices are not available, fair values are based on quoted market prices of instruments of a similar type, credit quality and structure, adjusted for differences between the quoted instruments and the instruments being valued. See "Note 8 - Fair Value Measurement," for additional information. Investment securities having a fair value of $ 429.4 million at March 31, 2025 and $ 440.0 million at December 31, 2024 were pledged primarily to secure public deposits, some Trust department deposit accounts, and certain other borrowings. In accordance with legal provisions for alternatives other than pledging of investments, Mid Penn also obtains letters of credit from the FHLB to secure certain public deposits. These FHLB letter of credit commitments totaled $ 113.0 million as of March 31, 2025 and $ 156.0 million as of December 31, 2024. The following tables present gross unrealized losses and fair value of debt investment securities aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position for the periods presented: (Dollars in thousands) Less Than 12 Months 12 Months or More Total March 31, 2025 Number of Securities Estimated Fair Value Gross Unrealized Losses Number of Securities Estimated Fair Value Gross Unrealized Losses Number of Securities Estimated Fair Value Gross Unrealized Losses Available-for-sale debt securities: U.S. Treasury and U.S. government agencies — $ — $ — 12 $ 21,757 $ 516 12 $ 21,757 $ 516 Mortgage-backed U.S. government agencies 10 74,099 1,141 90 126,008 14,867 100 200,107 16,008 State and political subdivision obligations — — — 8 3,595 710 8 3,595 710 Corporate debt securities 1 3,955 — 17 29,079 2,755 18 33,034 2,755 Total available-for-sale debt securities 11 $ 78,054 $ 1,141 127 $ 180,439 $ 18,848 138 $ 258,493 $ 19,989 Held-to-maturity debt securities: U.S. Treasury and U.S. government agencies — — — 141 215,024 22,952 141 215,024 22,952 Mortgage-backed U.S. government agencies 3 302 — 61 31,271 4,703 64 31,573 4,703 State and political subdivision obligations 9 3,734 23 163 65,051 6,610 172 68,785 6,633 Corporate debt securities 4 10,500 — 11 13,826 1,120 15 24,326 1,120 Total held-to-maturity debt securities 16 14,536 23 376 325,172 35,385 392 339,708 35,408 Total 27 $ 92,590 $ 1,164 503 $ 505,611 $ 54,233 530 $ 598,201 $ 55,397 15 Table of Contents MID PENN BANCORP, INC. (Dollars in thousands) Less Than 12 Months 12 Months or More Total December 31, 2024 Number of Securities Estimated Fair Value Gross Unrealized Losses Number of Securities Estimated Fair Value Gross Unrealized Losses Number of Securities Estimated Fair Value Gross Unrealized Losses Available-for-sale securities: U.S. Treasury and U.S. government agencies — $ — $ — 12 $ 21,507 $ 740 12 $ 21,507 $ 740 Mortgage-backed U.S. government agencies 9 72,499 1,847 91 130,445 17,684 100 202,944 19,531 State and political subdivision obligations — — — 8 3,596 713 8 3,596 713 Corporate debt securities — — — 18 32,430 3,320 18 32,430 3,320 Total available-for-sale securities 9 72,499 1,847 129 187,978 22,457 138 260,477 24,304 Held-to-maturity securities: U.S. Treasury and U.S. government agencies — $ — $ — 143 $ 213,808 $ 28,133 143 $ 213,808 $ 28,133 Mortgage-backed U.S. government agencies 2 163 1 62 31,922 5,507 64 32,085 5,508 State and political subdivision obligations 8 3,176 30 169 67,446 6,810 177 70,622 6,840 Corporate debt securities 4 10,500 — 11 13,633 1,318 15 24,133 1,318 Total held to maturity securities 14 13,839 31 385 326,809 41,768 399 340,648 41,799 Total 23 $ 86,338 $ 1,878 514 $ 514,787 $ 64,225 537 $ 601,125 $ 66,103 At March 31, 2025 and 2024, the majority of the unrealized losses on securities in an unrealized loss position were attributable to U.S. Treasury and U.S. government agencies, and mortgage-backed U.S. government agencies. Mid Penn had no securities considered by management to be credit related losses as of March 31, 2025 and 2024, and did not record any securities losses in the respective periods ended on these dates. Mid Penn does not consider the securities with unrealized losses on the respective dates to be credit related losses as the unrealized losses were deemed to be temporary changes in value related to market movements in interest yields at various periods similar to the maturity dates of holdings in the investment portfolio, and not reflective of an erosion of credit quality. There were no gross realized gains and losses on sales of available-for-sale debt securities for the three months ended March 31, 2025 and 2024. The table below illustrates the contractual maturity of debt investment securities at amortized cost and estimated fair value. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay with or without call or prepayment penalties. (In thousands) Available-for-sale Held-to-maturity March 31, 2025 Amortized Cost Fair Value Amortized Cost Fair Value Due in 1 year or less $ 10,501 $ 10,486 $ 19,738 $ 19,640 Due after 1 year but within 5 years 22,423 21,734 140,361 131,748 Due after 5 years but within 10 years 28,564 25,538 164,425 145,154 Due after 10 years 844 628 14,316 11,593 62,332 58,386 338,840 308,135 Mortgage-backed securities 215,826 200,107 36,275 31,573 $ 278,158 $ 258,493 $ 375,115 $ 339,708 16 Table of Contents MID PENN BANCORP, INC. Note 4 - Loans and Allowance for Credit Losses - Loans Loans, net of unearned income, are summarized as follows by portfolio segment: (In thousands) March 31, 2025 December 31, 2024 Commercial real estate CRE Nonowner Occupied $ 1,272,153 $ 1,251,010 CRE Owner Occupied 654,305 624,007 Multifamily 410,531 412,900 Farmland 226,033 224,709 Total Commercial real estate 2,563,022 2,512,626 Commercial and industrial 720,695 705,392 Construction Residential Construction 88,196 99,399 Other Construction 321,015 326,171 Total Construction 409,211 425,570 Residential mortgage 1-4 Family 1st Lien 312,162 313,592 1-4 Family Rental 339,880 336,636 HELOC and Junior Liens 139,380 140,392 Total Residential Mortgage 791,422 790,620 Consumer 6,817 8,862 Total loans $ 4,491,167 $ 4,443,070 Total loans are stated at the amount of unpaid principal, adjusted for net deferred fees and costs. Net deferred loan fees were $ 3.3 million and $ 3.8 million as of March 31, 2025 and December 31, 2024, respectively. Accrued interest receivable is not included in the amortized cost basis of Mid Penn's loans. Accrued interest receivable for loans totaled $ 23.5 million and $ 22.9 million as of March 31, 2025 and December 31, 2024, respectively, with no related ACL and was reported in other assets on the accompanying Consolidated Balance Sheet. Past Due and Nonaccrual Loans The performance and credit quality of the loan portfolio is also monitored by analyzing the age of the loans receivable as determined by the length of time a recorded payment is past due. The classes of the loan portfolio summarized by the past due status as of March 31, 2025 and December 31, 2024, are summarized as follows: 17 Table of Contents MID PENN BANCORP, INC. (In thousands) 30-59 Days Past Due 60-89 Days Past Due Greater than 90 Days Total Past Due Current Total Loans Loans Receivable > 90 Days and Accruing March 31, 2025 Commercial real estate CRE Nonowner Occupied $ 1,746 $ — $ 13,919 $ 15,665 $ 1,256,488 $ 1,272,153 $ — CRE Owner Occupied 2,176 — 298 2,474 651,831 654,305 — Multifamily — — — — 410,531 410,531 — Farmland 1 — — 1 226,032 226,033 — Total Commercial real estate 3,923 — 14,217 18,140 2,544,882 2,563,022 — Commercial and industrial 112 35 797 944 719,751 720,695 3 Construction Residential Construction — — — — 88,196 88,196 — Other Construction — — — — 321,015 321,015 — Total Construction — — — — 409,211 409,211 — Residential mortgage 1-4 Family 1st Lien 583 79 386 1,048 311,114 312,162 — 1-4 Family Rental — 4 125 129 339,751 339,880 — HELOC and Junior Liens 649 — 1,433 2,082 137,298 139,380 — Total Residential Mortgage 1,232 83 1,944 3,259 788,163 791,422 — Consumer — — — — 6,817 6,817 — Total $ 5,267 $ 118 $ 16,958 $ 22,343 $ 4,468,824 $ 4,491,167 $ 3 18 Table of Contents MID PENN BANCORP, INC. (In thousands) 30-59 Days Past Due 60-89 Days Past Due Greater than 90 Days Total Past Due Current Total Loans Loans Receivable > 90 Days and Accruing December 31, 2024 Commercial real estate CRE Nonowner Occupied $ 1,281 $ 1,515 $ 11,658 $ 14,454 $ 1,236,556 $ 1,251,010 $ — CRE Owner Occupied 39 51 262 352 623,655 624,007 — Multifamily — — — — 412,900 412,900 — Farmland 184 — — 184 224,525 224,709 — Total Commercial real estate 1,504 1,566 11,920 14,990 2,497,636 2,512,626 — Commercial and industrial 74 3 794 871 704,521 705,392 — Construction Residential Construction — — — — 99,399 99,399 — Other Construction — — — — 326,171 326,171 — Total Construction — — — — 425,570 425,570 — Residential mortgage 1-4 Family 1st Lien 2,853 220 516 3,589 310,003 313,592 — 1-4 Family Rental 374 7 137 518 336,118 336,636 — HELOC and Junior Liens 724 209 2,157 3,090 137,302 140,392 — Total Residential Mortgage 3,951 436 2,810 7,197 783,423 790,620 — Consumer 20 — — 20 8,842 8,862 — Total $ 5,549 $ 2,005 $ 15,524 $ 23,078 $ 4,419,992 $ 4,443,070 $ — Loans are placed on nonaccrual status when management determines that the full repayment of principal and collection of interest according to contractual terms is no longer likely, generally when the loan becomes 90 days or more past due. Nonaccrual loans by loan portfolio class, including loans acquired with credit deterioration, as of March 31, 2025 and December 31, 2024 are summarized as follows: March 31, 2025 December 31, 2024 (In thousands) With a Related Allowance Without a Related Allowance Total With a Related Allowance Without a Related Allowance Total Commercial real estate CRE Nonowner Occupied 3,677 10,242 13,919 2,622 11,153 13,775 CRE Owner Occupied — 2,032 2,032 — 546 546 Multifamily — 147 147 — 154 154 Total Commercial real estate 3,677 12,421 16,098 2,622 11,853 14,475 Commercial and industrial 4,989 611 5,600 758 3,894 4,652 Construction Residential Construction — — — — — — Other Construction — — — — — — Total Construction — — — — — — Residential mortgage 1-4 Family 1st Lien — 654 654 — 1,028 1,028 1-4 Family Rental — 160 160 — 176 176 HELOC and Junior Liens — 1,533 1,533 — 2,279 2,279 Total Residential Mortgage $ — $ 2,347 $ 2,347 $ — $ 3,483 $ 3,483 Consumer — — — — — — Total loans $ 8,666 $ 15,379 $ 24,045 $ 3,380 $ 19,230 $ 22,610 19 Table of Contents MID PENN BANCORP, INC. The amount of interest income recognized on nonaccrual loans was approximately $ 127 thousand and $ 159 thousand during the three months ended March 31, 2025 and 2024, respectively. Credit Quality Indicators Mid Penn categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt, such as current financial information, historical payment experience, credit documentation, public information and current economic trends, among other factors. On a minimum of a quarterly basis, Mid Penn analyzes loans individually to classify the loans according to their credit risk. The following table presents risk ratings by loan portfolio segment and origination year, which is the year of origination or renewal. PASS - This type of classification consists of 6 subcategories: Nominal Risk / Pass - This loan classification is a credit extension of the highest quality. Moderate Risk / Pass - This type of classification has strong financial ratios, substantial debt capacity, and low leverage with a very favorable comparison to industry peers or better than average improving trends are necessary to be in this classification. Good Acceptable Risk / Pass - The Borrower in this rating classification is a reasonable credit risk having financial ratios on par with its peers and demonstrates slightly improving trends over time; they list good quality assets and fairly low leverage plus ample debt capacity. Average Acceptable Risk / Pass - This type of classification has financial ratios and assets are of above average quality, the leverage is worse than average compared to industry standards; the Borrower should have a good repayment history and possess consistent earnings with some growth. Marginally Acceptable Risk / Pass - This type of classification has financial ratios consistent with industry averages, assets of average quality with ascertainable values, acceptable leverage, moderate capital assets and an acceptable reliance on trade debt; the Borrower demonstrates marginally adequate earnings, cash flow and debt service plus positive trends. Weak/Monitor Risk (Watch list) / Pass - This type of classification has financial ratios that are slightly below standard industry averages and assets are below average quality with unstable values; fixed assets could be near or at the end of their useful life and liabilities may not match the asset structure. SPECIAL MENTION - These credits have developing weaknesses deserving extra attention from the lender and lending management. They are currently protected, but potentially weak. The weakness may be cash flow, leverage, liquidity, management, industry or other factors which may, if not checked or corrected, weaken the asset or inadequately protect the Bank’s credit position at some future date. SUBSTANDARD - These credit extensions also have well-defined weaknesses, which are inadequately protected by the current worth and debt service capacity of the Borrower, or the collateral pledged, if any. The repayment of principal and interest as originally intended can be jeopardized by defined weaknesses related to adverse financial, managerial, economic, market or political conditions. DOUBTFUL - These credits have definite weaknesses inherent in Substandard loans with added characteristics that are severe enough to make further collection in full highly questionable and improbable based on the current trends. LOSS . These loans are considered uncollectible and no longer a viable asset of the Bank. They lack an identifiable source of repayment based on an inability to generate sufficient cash flow to service the debt. All trends are negative and the damage to the financial condition of the Borrower cannot be reversed now or in the near future. 20 Table of Contents MID PENN BANCORP, INC. The following table presents risk ratings by loan portfolio segment and origination year, which is the year of origination or renewal. March 31, 2025 Term Loans Amortized Cost Basis by Origination Year Revolving Loans Amortized Cost Basis (In thousands) 2025 2024 2023 2022 2021 Prior Total CRE Nonowner Occupied Pass $ 20,673 $ 85,769 $ 197,443 $ 339,713 $ 150,865 $ 440,272 $ 11,179 $ 1,245,914 Special mention — — — — — 4,418 — 4,418 Substandard or lower — — 1,540 1,280 — 19,001 — 21,821 Total CRE Nonowner Occupied 20,673 85,769 198,983 340,993 150,865 463,691 11,179 1,272,153 Gross charge offs — — — — — — — — Current period recoveries — — — — — 1 — 1 Net charge offs — — — — — 1 — 1 CRE Owner Occupied Pass 33,854 61,419 104,424 104,367 64,246 263,242 14,350 645,902 Special mention — — — 4,943 174 1,001 — 6,118 Substandard or lower — — — — 235 2,050 — 2,285 Total CRE Owner Occupied 33,854 61,419 104,424 109,310 64,655 266,293 14,350 654,305 Gross charge offs — — — — — — — — Current period recoveries — — — — — — — — Net recoveries — — — — — — — — Multifamily Pass 2,943 4,854 66,143 118,458 100,824 113,606 3,505 410,333 Special mention — — — — — 51 — 51 Substandard or lower — — — — — 147 — 147 Total Multifamily 2,943 4,854 66,143 118,458 100,824 113,804 3,505 410,531 Gross charge offs — — — — — — — — Current period recoveries — — — — — — — — Net charge offs — — — — — — — — Farmland Pass 7,125 28,095 29,605 54,696 40,912 48,779 13,224 222,436 Special mention — — 127 — 1,153 2,129 188 3,597 Substandard or lower — — — — — — — — Total Farmland 7,125 28,095 29,732 54,696 42,065 50,908 13,412 226,033 Gross charge offs — — — — — — — — Current period recoveries — — — — — — — — Net charge offs — — — — — — — — Commercial and industrial Pass 53,535 111,556 100,212 71,545 52,191 103,350 217,835 710,224 Special mention — 120 56 213 62 2,451 4,585 7,487 Substandard or lower — — — — 785 1,599 600 2,984 Total commercial and industrial 53,535 111,676 100,268 71,758 53,038 107,400 223,020 720,695 Gross charge offs — — — — — — — — Current period recoveries — — 1 — — 5 — 6 Net charge offs — — 1 — — 5 — 6 21 Table of Contents MID PENN BANCORP, INC. Residential Construction Pass 1,923 38,527 36,783 2,952 — — 8,011 88,196 Special mention — — — — — — — — Substandard or lower — — — — — — — — Total Residential Construction 1,923 38,527 36,783 2,952 — — 8,011 88,196 Gross charge offs — — — — — — — — Current period recoveries — — — — — — — — Net recoveries — — — — — — — — Other Construction Pass 20,573 69,098 74,600 97,132 10,927 21,577 27,108 321,015 Special mention — — — — — — — — Substandard or lower — — — — — — — — Total Other Construction 20,573 69,098 74,600 97,132 10,927 21,577 27,108 321,015 Gross charge offs — — — — — — — — Current period recoveries — — — — — — — — Net recoveries — — — — — — — — 1-4 Family 1st Lien Performing 15,389 18,710 59,014 44,951 34,232 135,632 2,354 310,282 Non-performing — — — — — 1,880 — 1,880 Total 1-4 Family 1st Lien 15,389 18,710 59,014 44,951 34,232 137,512 2,354 312,162 Gross charge offs — — — — — — — — Current period recoveries — — — — — 2 — 2 Net recoveries — — — — — 2 — 2 1-4 Family Rental Performing 9,308 24,953 49,924 93,316 57,899 101,725 1,896 339,021 Non-performing — — 147 — — 712 — 859 Total 1-4 Family Rental 9,308 24,953 50,071 93,316 57,899 102,437 1,896 339,880 Gross charge offs — — — — — — — — Current period recoveries — — — — — — — — Net recoveries — — — — — — — — HELOC and Junior Liens Performing 1,230 5,023 15,743 9,347 4,810 12,693 87,297 136,143 Non-performing — 1,000 101 — — 1,135 1,001 3,237 Total HELOC and Junior Liens 1,230 6,023 15,844 9,347 4,810 13,828 88,298 139,380 Gross charge offs — — — — — — — — Current period recoveries — — — — — — — — Net charge offs — — — — — — — — Consumer Performing 1,379 1,566 915 316 365 265 2,011 6,817 Non-performing — — — — — — — — Total consumer 1,379 1,566 915 316 365 265 2,011 6,817 Gross charge offs — — — — — ( 15 ) — ( 15 ) Current period recoveries — — — — — 9 — 9 Net charge offs — — — — — ( 6 ) — ( 6 ) Total Pass $ 140,626 $ 399,318 $ 609,210 $ 788,863 $ 419,965 $ 990,826 $ 295,212 $ 3,644,020 Special mention — 120 183 5,156 1,389 10,050 4,773 21,671 Substandard or lower — — 1,540 1,280 1,020 22,797 600 27,237 22 Table of Contents MID PENN BANCORP, INC. Performing 27,306 50,252 125,596 147,930 97,306 250,315 93,558 792,263 Nonperforming — 1,000 248 — — 3,727 1,001 5,976 Total $ 167,932 $ 450,690 $ 736,777 $ 943,229 $ 519,680 $ 1,277,715 $ 395,144 $ 4,491,167 23 Table of Contents MID PENN BANCORP, INC. December 31, 2024 Term Loans Amortized Cost Basis by Origination Year Revolving Loans Amortized Cost Basis (In thousands) 2024 2023 2022 2021 2020 Prior Total CRE Nonowner Occupied Pass $ 85,501 $ 176,018 $ 343,072 $ 152,157 $ 130,650 $ 325,478 $ 11,732 $ 1,224,608 Special mention — — — — — 3,105 — 3,105 Substandard or lower — 1,515 1,260 — 3,281 17,241 — 23,297 Total CRE Nonowner Occupied 85,501 177,533 344,332 152,157 133,931 345,824 11,732 1,251,010 Gross charge offs — — — — — — — — Current period recoveries — — — — — 2 — 2 Net recoveries — — — — — 2 — 2 CRE Owner Occupied Pass 52,922 99,065 106,876 66,160 77,774 199,725 11,630 614,152 Special mention — 222 4,991 227 — 2,133 — 7,573 Substandard or lower — — — 194 — 2,088 — 2,282 Total CRE Owner Occupied 52,922 99,287 111,867 66,581 77,774 203,946 11,630 624,007 Gross charge offs — — — — — — — — Current period recoveries — — — — — 4 — 4 Net recoveries — — — — — 4 — 4 Multifamily Pass 4,843 66,119 118,568 101,871 40,450 78,070 2,771 412,692 Special mention — — — — — 54 — 54 Substandard or lower — — — — — 154 — 154 Total Multifamily 4,843 66,119 118,568 101,871 40,450 78,278 2,771 412,900 Gross charge offs — — — — — — — — Current period recoveries — — — — — — — — Net charge offs — — — — — — — — Farmland Pass 27,449 31,259 56,178 42,693 25,119 24,729 14,801 222,228 Special mention — 128 — — — 2,163 190 2,481 Substandard or lower — — — — — — — — Total Farmland 27,449 31,387 56,178 42,693 25,119 26,892 14,991 224,709 Gross charge offs — — — — — — — — Current period recoveries — — — — — — — — Net charge offs — — — — — — — — Commercial and industrial Pass 114,175 106,657 78,702 54,312 21,532 92,723 222,525 690,626 Special mention — 62 503 31 — 3,534 4,498 8,628 Substandard or lower — — — 892 1,168 1,632 2,446 6,138 Total commercial and industrial 114,175 106,719 79,205 55,235 22,700 97,889 229,469 705,392 Gross charge offs — ( 201 ) — — ( 206 ) ( 412 ) — ( 819 ) Current period recoveries — — — — — 1 — 1 Net charge offs — ( 201 ) — — ( 206 ) ( 411 ) — ( 818 ) Residential construction Pass 34,275 37,222 15,559 — — 2,007 10,336 99,399 Special mention — — — — — — — — 24 Table of Contents MID PENN BANCORP, INC. Substandard or lower — — — — — — — — Total Residential construction 34,275 37,222 15,559 — — 2,007 10,336 99,399 Gross charge offs — — — — — — — — Current period recoveries — — — — — — — — Net recoveries — — — — — — — — Other construction Pass 66,711 94,619 104,439 11,664 10,983 11,928 25,827 326,171 Special mention — — — — — — — — Substandard or lower — — — — — — — — Total Other construction 66,711 94,619 104,439 11,664 10,983 11,928 25,827 326,171 Gross charge offs — — — — — — — — Current period recoveries — — — — — — — — Net recoveries — — — — — — — — 1-4 Family 1st Lien Performing 27,580 59,762 45,946 34,743 42,727 98,891 2,915 312,564 Non-performing — — — — 211 817 — 1,028 Total 1-4 Family 1st Lien 27,580 59,762 45,946 34,743 42,938 99,708 2,915 313,592 Gross charge offs — — — — — ( 7 ) — ( 7 ) Current period recoveries — — — — — 16 — 16 Net recoveries — — — — — 9 — 9 1-4 Family Rental Performing 28,735 51,488 88,594 59,397 35,222 69,890 2,009 335,335 Non-performing — 147 — — 595 559 — 1,301 Total 1-4 Family Rental 28,735 51,635 88,594 59,397 35,817 70,449 2,009 336,636 Gross charge offs — — — — — ( 2 ) — ( 2 ) Current period recoveries — — — — — 22 — 22 Net recoveries — — — — — 20 — 20 HELOC and Junior Liens Performing 6,096 16,125 9,856 4,845 2,182 10,887 88,122 138,113 Non-performing — 21 — — — 1,257 1,001 2,279 Total HELOC and Junior Liens 6,096 16,146 9,856 4,845 2,182 12,144 89,123 140,392 Gross charge offs — — ( 21 ) — — — — ( 21 ) Current period recoveries — — — — — — — — Net charge offs — — ( 21 ) — — — — ( 21 ) Consumer Performing 4,214 972 354 394 107 234 2,587 8,862 Non-performing — — — — — — — — Total consumer 4,214 972 354 394 107 234 2,587 8,862 Gross charge offs — — ( 2 ) — — ( 50 ) — ( 52 ) Current period recoveries — — 1 — — 38 — 39 Net charge offs — — ( 1 ) — — ( 12 ) — ( 13 ) Total Pass $ 385,876 $ 610,959 $ 823,394 $ 428,857 $ 306,508 $ 734,660 $ 299,622 $ 3,589,876 Special mention — 412 5,494 258 — 10,989 4,688 21,841 Substandard or lower — 1,515 1,260 1,086 4,449 21,115 2,446 31,871 Performing 66,625 128,347 144,750 99,379 80,238 179,902 95,633 794,874 Nonperforming — 168 — — 806 2,633 1,001 4,608 Total $ 452,501 $ 741,401 $ 974,898 $ 529,580 $ 392,001 $ 949,299 $ 403,390 $ 4,443,070 25 Table of Contents MID PENN BANCORP, INC. Mid Penn had no loans classified as "doubtful" as of March 31, 2025 and December 31, 2024. There was $ 109 thousand and $ 861 thousand in loans for which formal foreclosure proceedings were in process at March 31, 2025 and December 31, 2024, respectively. Collateral-Dependent Loans A financial asset is considered to be collateral-dependent when the debtor is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral. For all classes of financial assets deemed collateral-dependent, Mid Penn elected the practical expedient to estimate expected credit losses based on the collateral’s fair value less cost to sell. In most cases, Mid Penn records a partial charge-off to reduce the loan’s carrying value to the collateral’s fair value less cost to sell. Substantially all of the collateral supporting collateral-dependent financial assets consists of various types of real estate, including residential properties; commercial properties such as retail centers, office buildings, and lodging; agriculture land; and vacant land. Total collateral-dependent loans as of March 31, 2025 were $ 24.0 million. Allowance for Credit Losses Mid Penn’s ACL - loans methodology follows guidance within FASB ASC Subtopic 326-20. The ACL - loans is a valuation account that is deducted from the loans’ amortized cost basis to present the net amount expected to be collected on the loans. Credit quality within the loan portfolio is continuously monitored by management and is reflected within the ACL - loans. The ACL - loans is an estimate of expected losses inherent within Mid Penn’s existing loan portfolio. The ACL - loans is adjusted through the PCL and reduced by the charge off of loan amounts, net of recoveries. The loan loss estimation process involves procedures to appropriately consider the unique characteristics of Mid Penn’s loan portfolio segments. When computing allowance levels, credit loss assumptions are estimated using a model that categorizes loan pools based on loss history and other credit trends and risk characteristics, including current conditions and reasonable and supportable forecasts about the future. Evaluations of the portfolio and individual credits are inherently subjective, as they require estimates, assumptions and judgments as to the facts and circumstances of particular situations. Determining the appropriateness of the allowance is complex and requires judgement by management about the effect of matters that are inherently uncertain. 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 ACL and credit loss expense. Mid Penn estimates the ACL using relevant available information, from internal and external sources, relating to past events, current conditions and reasonable and supportable forecasts. Mid Penn uses a third-party software application to calculate the quantitative portion of the ACL using a methodology and assumptions specific to each loan pool. The qualitative portion of the allowance is based on general economic conditions and other internal and external factors affecting Mid Penn as a whole, as well as specific loans. Factors considered include the following: lending process, concentrations of credit, and peer group divergence. The quantitative and qualitative portions of the allowance are added together to determine the total ACL, which reflects management’s expectations of future conditions based on reasonable and supportable forecasts. The methodology for estimating the amount of expected credit losses reported in the ACL has two basic components: a collective, or pooled, component for estimated expected credit losses for pools of loans that share similar risk characteristics, and an asset-specific component involving individual loans that do not share risk characteristics with other loans and the measurement of expected credit losses for such individual loans. In estimating the ACL for the collective component, loans are segregated into loan pools based on loan purpose codes and similar risk characteristics. The commercial real estate and residential mortgage loan portfolio segments include loans for both commercial and residential properties that are secured by real estate. The underwriting process for these loans includes analysis of the financial position and strength of both the borrower and, if applicable, guarantor, experience with similar projects in the past, market demand and prospects for successful completion of the proposed project within the established budget and schedule, values of underlying collateral, availability of permanent financing, maximum loan-to-value ratios, minimum equity requirements, acceptable amortization periods and minimum debt service coverage requirements, based on property type. The borrower’s financial strength and capacity to repay their obligations remain the primary focus of underwriting. Financial strength is evaluated based upon analytical tools that consider historical and projected cash flows and performance, in addition to analysis of the proposed project for income-producing properties. Additional support offered by guarantors is also considered when applicable. Ultimate repayment of these loans is sensitive to interest rate changes, general economic conditions, liquidity and availability of long-term financing. 26 Table of Contents MID PENN BANCORP, INC. The commercial and industrial loan portfolio segment includes commercial loans made to many types of businesses for various purposes, such as short-term working capital loans that are usually secured by accounts receivable and inventory, equipment and fixed asset purchases that are secured by those assets, and term financing for those within Mid Penn’s geographic markets. Mid Penn’s credit underwriting process for commercial and industrial loans includes analysis of historical and projected cash flows and performance, evaluation of financial strength of both borrowers and guarantors as reflected in current and detailed financial information, and evaluation of underlying collateral to support the credit. The consumer loan portfolio segment is comprised of loans which are underwritten after evaluating a borrower’s capacity, credit and collateral. Several factors are considered when assessing a borrower’s capacity, including the borrower’s employment, income, current debt, assets and level of equity in the property. Credit is assessed using a credit report that provides credit scores and the borrower’s current and past information about their credit history. Loan-to-value and debt-to-income ratios, loan amount and lien position are also considered in assessing whether to originate a loan. These borrowers are particularly susceptible to downturns in economic trends, such as conditions that negatively affect housing prices and demand and levels of unemployment. Mid Penn utilizes a DCF method to estimate the quantitative portion of the allowance for credit losses for loan pools. The DCF is based off of historical losses, including peer data, which is correlated to national unemployment and GDP. The PD and LGD measures are used in conjunction with prepayment data as inputs into the DCF model to calculate the cash flows at the individual loan level. Contractual cash flows based on loan terms are adjusted for PD, LGD and prepayments to derive loss cash flows. These loss cash flows are discounted by the loan’s coupon rate to arrive at the discounted cash flow based quantitative loss. The prepayment studies are updated quarterly by a third-party for each applicable pool. Mid Penn determined that reasonable and supportable forecasts could be made for a twelve-month period for all of its loan pools. To the extent the lives of the loans in the portfolio extend beyond this forecast period, Mid Penn uses a reversion period of four quarters and reverts to the historical mean on a straight-line basis over the remaining life of the loans. Qualitative factors used in the ACL methodology include the following: • Lending process • Concentrations of credit • Peer Group Divergence The ACL for individual loans, such as non-accrual and PCD, that do not share risk characteristics with other loans is measured as the difference between the discounted value of expected future cash flows, based on the effective interest rate at origination, and the amortized cost basis of the loan, or the net realizable value. The ACL is the difference between the loan’s net realizable value and its amortized cost basis (net of previous charge-offs and deferred loan fees and costs), except for collateral-dependent loans. A loan is collateral dependent when the borrower is experiencing financial difficulty and repayment of the loan is expected to be provided substantially through the sale of the collateral. The expected credit loss for collateral-dependent loans is measured as the difference between the amortized cost basis of the loan and the fair value of the collateral, adjusted for the estimated cost to sell. Fair value estimates for collateral-dependent loans are derived from appraised values based on the current market value or the "as is" value of the collateral, normally from recently received and reviewed appraisals. Current appraisals are ordered on a regular basis based on the inspection date or more often if market conditions necessitate. Appraisals are obtained from state-certified appraisers and are based on certain assumptions, which may include construction or development status and the highest and best use of the property. These appraisals are reviewed by Mid Penn’s Appraisal Review Department to ensure they are acceptable, and values are adjusted down for costs associated with asset disposal. If the calculated expected credit loss is determined to be permanent or not recoverable, the amount of the expected credit loss is charged off. Mid Penn may also purchase loans or acquire loans through a business combination. At the purchase or acquisition date, loans are evaluated to determine whether there has been more than insignificant credit deterioration since origination. Loans that have experienced more than insignificant credit deterioration since origination are referred to as PCD loans. In its evaluation of whether a loan has experienced more than insignificant deterioration in credit quality since origination, Mid Penn takes into consideration loan grades, past due and nonaccrual status. Mid Penn may also consider external credit rating agency ratings for borrowers and for non-commercial loans, FICO score or band, probability of default levels, and number of times past due. At the purchase or acquisition date, the amortized cost basis of PCD loans is equal to the purchase price and an initial estimate of credit losses. The initial recognition of expected credit losses on PCD loans has no 27 Table of Contents MID PENN BANCORP, INC. impact on net income. When the initial measurement of expected credit losses on PCD loans is calculated on a pooled loan basis, the expected credit losses are allocated to each loan within the pool. Any difference between the initial amortized cost basis and the unpaid principal balance of the loan represents a noncredit discount or premium, which is accreted (or amortized) into interest income over the life of the loan. Subsequent changes to the ACL on PCD loans are recorded through the PCL. For purchased loans that are not deemed to have experienced more than insignificant credit deterioration since origination and are therefore not deemed PCD, any discounts or premiums included in the purchase price are accreted (or amortized) over the contractual life of the individual loan. Loans are charged off against the ACL-loans, with any subsequent recoveries credited back to the ACL-loans account. Expected recoveries may not exceed the aggregate of amounts previously charged off and expected to be charged off. The following tables present the activity in the ACL - loans by portfolio segment for the three months ended March 31, 2025 and the three months ended March 31, 2024: (In thousands) Balance at December 31, 2024 Charge offs Recoveries Net loans (charged off) recovered Provision/(Benefit) for credit losses Three Months Ended March 31, 2025 Commercial Real Estate CRE Nonowner Occupied 11,047 — 1 1 ( 668 ) 10,380 CRE Owner Occupied 5,243 — — — 479 5,722 Multifamily 3,432 — — — ( 108 ) 3,324 Farmland 1,932 — — — 143 2,075 Commercial and industrial 7,122 — 6 6 736 7,864 Construction Residential Construction 931 — — — ( 101 ) 830 Other Construction 2,131 — — — ( 232 ) 1,899 Residential Mortgage 1-4 Family 1st Lien 1,503 — 2 2 77 1,582 1-4 Family Rental 1,756 — — — ( 16 ) 1,740 HELOC and Junior Liens 392 — — — 12 404 Consumer 25 ( 15 ) 9 ( 6 ) ( 1 ) 18 Total 35,514 ( 15 ) 18 3 321 35,838 28 Table of Contents MID PENN BANCORP, INC. (In thousands) Balance at December 31, 2023 Charge offs Recoveries Net loans (charged off) recovered (Benefit)/Provision for credit losses Three Months Ended March 31, 2024 Commercial Real Estate CRE Nonowner Occupied $ 10,267 $ — $ — $ — $ 150 $ 10,417 CRE Owner Occupied 5,646 — — — ( 44 ) 5,602 Multifamily 2,202 — — — 168 2,370 Farmland 2,064 — — — ( 62 ) 2,002 Commercial and industrial 7,131 — — — ( 631 ) 6,500 Construction Residential Construction 1,256 — — — ( 80 ) 1,176 Other Construction 2,146 — — — 25 2,171 Residential Mortgage 1-4 Family 1st Lien 1,207 ( 7 ) — ( 7 ) 71 1,271 1-4 Family Rental 1,859 — — — ( 320 ) 1,539 HELOC and Junior Liens 389 ( 21 ) — ( 21 ) 89 457 Consumer 20 ( 22 ) 6 ( 16 ) 15 19 Total $ 34,187 $ ( 50 ) $ 6 $ ( 44 ) $ ( 619 ) $ 33,524 29 Table of Contents MID PENN BANCORP, INC. The following table presents the ACL for loans and the amortized cost basis of the loans by the measurement methodology used as of March 31, 2025 and December 31, 2024: (In thousands) ACL - Loans Loans March 31, 2025 Collectively Evaluated for Credit Loss Individually Evaluated for Credit Loss Total ACL - Loans Collectively Evaluated for Credit Loss Individually Evaluated for Credit Loss Total Loans Commercial real estate CRE Nonowner Occupied $ 8,823 $ 1,557 $ 10,380 $ 1,258,234 $ 13,919 $ 1,272,153 CRE Owner Occupied 5,722 — 5,722 652,273 2,032 654,305 Multifamily 3,324 — 3,324 410,384 147 410,531 Farmland 2,075 — 2,075 226,033 — 226,033 Commercial and industrial 7,038 826 7,864 715,095 5,600 720,695 Construction Residential Construction 830 — 830 88,196 — 88,196 Other Construction 1,899 — 1,899 321,015 — 321,015 Residential mortgage 1-4 Family 1st Lien 1,582 — 1,582 311,508 654 312,162 1-4 Family Rental 1,740 — 1,740 339,720 160 339,880 HELOC and Junior Liens 404 — 404 137,847 1,533 139,380 Consumer 18 — 18 6,817 — 6,817 Total $ 33,455 $ 2,383 $ 35,838 $ 4,467,122 $ 24,045 $ 4,491,167 (In thousands) ACL - Loans Loans December 31, 2024 Collectively Evaluated for Credit Loss Individually Evaluated for Credit Loss Total ACL - Loans Collectively Evaluated for Credit Loss Individually Evaluated for Credit Loss Total Loans Commercial real estate CRE Nonowner Occupied $ 9,945 $ 1,102 $ 11,047 $ 1,237,235 $ 13,775 $ 1,251,010 CRE Owner Occupied 5,243 — 5,243 623,461 546 624,007 Multifamily 3,432 — 3,432 412,746 154 412,900 Farmland 1,932 — 1,932 224,709 — 224,709 Commercial and industrial 6,785 337 7,122 700,740 4,652 705,392 Construction Residential Construction 931 — 931 99,399 — 99,399 Other Construction 2,131 — 2,131 326,171 — 326,171 Residential mortgage 1-4 Family 1st Lien 1,503 — 1,503 312,564 1,028 313,592 1-4 Family Rental 1,756 — 1,756 336,460 176 336,636 HELOC and Junior Liens 392 — 392 138,113 2,279 140,392 Consumer 25 — 25 8,862 — 8,862 Total $ 34,075 $ 1,439 $ 35,514 $ 4,420,460 $ 22,610 $ 4,443,070 30 Table of Contents MID PENN BANCORP, INC. Modifications to Borrowers Experiencing Financial Difficulty From time to time, we may modify certain loans to borrowers who are experiencing financial difficulty. In some cases, these modifications may result in new loans. Loan modifications to borrowers experiencing financial difficulty may be in the form of principal forgiveness, an interest rate reduction, an other-than-insignificant payment delay, or a term extension, or a combination thereof, among other things. There were no new modifications to borrowers experiencing financial difficulty for the three months ended March 31, 2025. Information related to loans modified (by type of modification) for the three months ended March 31, 2024, whereby the borrower was experiencing financial difficulty at the time of modification, is set forth in the following table: (In thousands) Interest Only Term Extension Combination: Interest Only and Term Extension Total % of Total Class of Financing Receivable Three months ended March 31, 2024 HELOC and Junior Liens $ — $ — $ 92 $ 92 0.01 Total Residential Mortgage — — 92 92 0.01 Total $ — $ — $ 92 $ 92 The financial effects of the interest-only loan modifications reduced the monthly payment amounts for the borrower and the term extensions in the table above added 2.0 years to the life of the loan, which also reduced the monthly payment amounts for the borrower. As of March 31, 2025, there were no defaulted troubled debt restructured loans, as all troubled debt restructured loans were current with respect to their associated forbearance agreements. There were also no defaults on troubled debt restructured loans within twelve months of restructure during 2024. 31 Table of Contents MID PENN BANCORP, INC. Note 5 - Deposits Deposits consisted of the following as of March 31, 2025 and December 31, 2024: (Dollars in thousands) March 31, 2025 % of Total Deposits December 31, 2024 % of Total Deposits Noninterest-bearing demand deposits $ 788,316 16.7 % $ 759,169 16.2 % Interest-bearing demand deposits 1,045,100 22.1 % 1,101,444 23.5 % Money market 1,067,661 22.6 % 958,051 20.4 % Savings 262,444 5.5 % 260,258 5.5 % Total demand and savings 3,163,521 66.9 % 3,078,922 65.6 % Time 1,568,681 33.1 % 1,611,005 34.4 % Total deposits $ 4,732,202 100.0 % $ 4,689,927 100.0 % The scheduled maturities of time deposits at March 31, 2025 were as follows: Time Deposits (In thousands) Less than $250,000 $250,000 or more Maturing in 2025 $ 969,787 $ 296,652 Maturing in 2026 197,038 45,330 Maturing in 2027 35,580 1,824 Maturing in 2028 11,364 561 Maturing in 2029 5,815 255 Maturing thereafter 3,883 592 $ 1,223,467 $ 345,214 Mid Penn had $ 319.8 million in brokered certificates of deposits as of March 31, 2025 and December 31, 2024, respectively. As of March 31, 2025 and December 31, 2024, Mid Penn had $ 66.3 million and $ 83.7 million of CDAR (Certificate of Deposit Account Registry) deposits, respectively. 32 Table of Contents MID PENN BANCORP, INC. Note 6 - Derivative Financial Instruments Mid Penn manages its exposure to certain interest rate risks through the use of derivatives; however, none are entered into for speculative purposes. In 2025, Mid Penn entered into outstanding derivative contracts designated as hedges. Mid Penn’s free-standing derivative financial instruments are required to be carried at their fair value on the Consolidated Balance Sheets. Loan-level Interest Rate Swaps Mid Penn enters into loan-level interest rate swaps with certain qualifying commercial loan customers to meet their interest rate risk management needs. Mid Penn simultaneously enters into interest rate swaps with dealer counterparties, with identical notional amounts and terms. The net result of the offsetting customer and dealer counterparty swap agreements is that the customer pays a fixed rate of interest and Mid Penn receives a floating rate. Mid Penn’s loan-level interest rate swaps are considered derivatives but are not accounted for using hedge accounting. Information related to loan level swaps is set forth in the following table: March 31, 2025 December 31, 2024 (Dollars in thousands) Interest rate swaps on loans with customers Notional amount $ 235,150 $ 217,150 Weighted average remaining term (years) 4.87 5.11 Receive fixed rate (weighted average) 4.88 % 4.68 % Pay variable rate (weighted average) 6.63 % 6.64 % Estimated fair value (1) $ 9,901 $ 11,118 March 31, 2025 December 31, 2024 (Dollars in thousands) Interest rate swaps on loans with correspondents Notional amount $ 235,150 $ 217,150 Weighted average remaining term (years) 4.87 5.11 Receive variable rate (weighted average) 6.63 % 6.64 % Pay fixed rate (weighted average) 4.88 % 4.68 % Estimated fair value (2) $ 9,901 $ 11,118 (1) The net amount of the estimated fair value is disclosed in Other Liabilities on the Consolidated Balance Sheet. (2) The net amount of the estimated fair value is disclosed in Other Assets on the Consolidated Balance Sheet. Cash Flow Hedges of Interest Rate Risk Mid Penn’s objectives in using interest rate derivatives are to reduce volatility in net interest income and to manage its exposure to interest rate movements. To accomplish this objective, Mid Penn primarily uses interest rate swaps as part of its interest rate risk management strategy. 33 Table of Contents MID PENN BANCORP, INC. Information related to cash flow hedges is set forth in the following table: March 31, 2025 December 31, 2024 (Dollars in thousands) Cash flow hedges Notional amount $ 315,000 $ 295,000 Weighted average remaining term (years) 1.34 1.55 Pay fixed rate (weighted average) 3.66 % 3.64 % Receive variable rate (weighted average) 3.89 % 4.10 % Estimated fair value (1) $ 913 $ 2,590 (1) Estimated fair value, net of accrued interest receivable, is disclosed in Other Assets on the Consolidated Balance Sheet. For derivatives designated and that qualify as cash flow hedges of interest rate risk, the unrealized gain or loss on the derivative is recorded in AOCI and subsequently reclassified into interest income in the same period during which the hedged transaction affects earnings. Amounts reported in AOCI related to derivatives will be reclassified to interest income as interest payments are made on Mid Penn’s variable-rate liabilities. During the next twelve months, Mid Penn estimates that an additional $ 914 thousand will be reclassified as a decrease to interest expense. Note 7 - Accumulated Other Comprehensive (Loss) Income The changes in each component of accumulated other comprehensive loss, net of taxes, are as follows: (I n thousands ) Unrealized Loss on Securities Unrealized Holding Losses on Interest Rate Derivatives used in Cash Flow Hedges Defined Benefit Plans Total Balance at December 31, 2024 $ ( 18,889 ) $ 1,485 $ 579 $ ( 16,825 ) OCI before reclassifications 3,656 ( 984 ) 16 2,688 Amounts reclassified from AOCI — — ( 26 ) ( 26 ) Balance at March 31, 2025 $ ( 15,233 ) $ 501 $ 569 ( 14,163 ) Balance at December 31, 2023 $ ( 17,339 ) $ 820 $ ( 118 ) $ ( 16,637 ) OCI before reclassifications ( 1,711 ) 1,410 8 ( 293 ) Amounts reclassified from AOCI — — ( 17 ) ( 17 ) Balance at March 31, 2024 $ ( 19,050 ) $ 2,230 $ ( 127 ) $ ( 16,947 ) 34 Table of Contents MID PENN BANCORP, INC. Note 8 - Fair Value Measurement Mid Penn uses estimates of fair value in applying various accounting standards for its consolidated financial statements on either a recurring or non-recurring basis. Fair value is defined as the price to sell an asset or transfer a liability in an orderly transaction between willing and able market participants. Mid Penn groups its assets and liabilities measured at fair value in three hierarchy levels, based on the observability and transparency of the inputs. The fair value hierarchy is as follows: Level 1 - Inputs that represent quoted prices for identical instruments in active markets. Level 2 - Inputs that represent quoted prices in markets that are not active, or inputs that are observable either directly or indirectly, for substantially the full term of the asset or liability. Level 3 - Inputs that are largely unobservable, as little or no market data exists for the instrument being valued. A description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. There were no transfers of assets between fair value Level 1 and Level 2 during the three months ended March 31, 2025 or the year ended December 31, 2024. The following tables illustrate the assets and liabilities measured at fair value on a recurring basis and reported on the Consolidated Balance Sheets. March 31, 2025 (In thousands) Level 1 Level 2 Level 3 Total Available-for-sale securities: U.S. Treasury and U.S. government agencies $ — $ 21,757 $ — $ 21,757 Mortgage-backed U.S. government agencies — 200,107 — 200,107 State and political subdivision obligations — 3,595 — 3,595 Corporate debt securities — 33,034 — 33,034 Equity securities 436 — — 436 Loans held for sale — 6,851 — 6,851 Other assets: Derivative assets — 10,814 — 10,814 Other liabilities: Derivative liabilities — 9,901 9,901 December 31, 2024 (In thousands) Level 1 Level 2 Level 3 Total Available-for-sale securities: U.S. Treasury and U.S. government agencies $ — $ 21,507 $ — $ 21,507 Mortgage-backed U.S. government agencies — 202,944 — 202,944 State and political subdivision obligations — 3,596 — 3,596 Corporate debt securities — 32,430 — 32,430 Equity securities 428 — — 428 Loans held for sale — 7,064 — 7,064 Other assets: Derivative assets — 13,708 — 13,708 Other liabilities: Derivative Liabilities — 11,118 — 11,118 35 Table of Contents MID PENN BANCORP, INC. The valuation methodologies and assumptions used to estimate the fair value for the items in the preceding tables are as follows: Available for sale investment securities - The fair value of equity and debt securities classified as available for sale is determined by obtaining quoted market prices on nationally recognized securities exchanges (Level 1), or matrix pricing (Level 2), which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted market prices for the specific securities, but rather, relying on the securities’ relationship to other benchmark quoted prices. Equity securities - The fair value of equity securities with readily determinable fair values is recorded on the Consolidated Balance Sheet, with realized and unrealized gains and losses reported in other expense on the Consolidated Statements of Income. Loans held for sale - This category includes mortgage loans held for sale that are measured at fair value. Fair values as of March 31, 2025 were measured as the price that secondary market investors were offering for loans with similar characteristics. Derivative instruments - Interest rate swaps are measured by alternative pricing sources with reasonable levels of price transparency in markets that are not active. Based on the complex nature of interest rate swap agreements, the markets these instruments trade in are not as efficient and are less liquid than that of the more mature Level 1 markets. These markets do, however, have comparable, observable inputs in which an alternative pricing source values these assets in order to arrive at a fair market value. These characteristics classify interest rate swap agreements as Level 2. Mortgage banking derivatives - represent the fair value of mortgage banking derivatives in the form of interest rate locks and forward commitments with secondary market investors and the fair value of interest rate swaps. The fair values of Mid Penn’s interest rate locks, forward commitments and interest rate swaps represent the amounts that would be required to settle the derivative financial instruments at the balance sheet date. These characteristics classify Mortgage banking derivatives as Level 2. As of March 31, 2025, Mortgage banking derivatives are not considered material. Certain financial assets and financial liabilities are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, upon their acquisition or when there is evidence of impairment). The following table illustrates financial instruments measured at fair value on a nonrecurring basis: March 31, 2025 (In thousands) Level 1 Level 2 Level 3 Total Individually evaluated loans, net of ACL $ — $ — $ 21,662 $ 21,662 Foreclosed assets held for sale — — 1,402 1,402 December 31, 2024 (In thousands) Level 1 Level 2 Level 3 Total Individually evaluated loans, net of ACL $ — $ — $ 21,171 $ 21,171 Foreclosed assets held for sale — — 44 44 Net loans - This category consists of loans that were individually evaluated for credit losses, net of the related ACL, and have been classified as Level 3 assets. All of Mid Penn’s individually evaluated loans for 2025 and 2024, whether reporting a specific allowance allocation or not, are considered collateral-dependent. Mid Penn utilized Level 3 inputs such as independent appraisals of the underlying collateral, which generally includes various Level 3 inputs which are not observable. Appraisals may be adjusted downward by management for qualitative factors such as economic conditions and estimated liquidation expenses. Foreclosed assets held for sale - Values are based on appraisals that consider the sales prices of property in the proximate vicinity. 36 Table of Contents MID PENN BANCORP, INC. The following table presents additional information about the valuation techniques for level 3 assets measured at fair value on a nonrecurring basis. March 31, 2025 (In thousands) Fair Value Valuation Technique Significant Unobservable Input Range of Inputs Weighted Average Individually evaluated loans, net of ACL $ 21,662 Appraisal of collateral Appraisal adjustments 8 % - 100 % 26.5 % Foreclosed assets held for sale 1,402 Appraisal of collateral Appraisal adjustments 41 % - 41 % 41.0 % December 31, 2024 (In thousands) Fair Value Valuation Technique Significant Unobservable Input Range of Inputs Weighted Average Individually evaluated loans, net of ACL $ 21,171 Appraisal of collateral Appraisal adjustments — % - 100 % 5.6 % Foreclosed assets held for sale 44 Appraisal of collateral Appraisal adjustments 26 % - 26 % 26.0 % The following tables summarize the carrying amount, fair value, and placement in the fair value hierarchy of Mid Penn's financial instruments as of the periods presented: March 31, 2025 Carrying Amount Estimated Fair Value (In thousands) Level 1 Level 2 Level 3 Total Financial instruments - assets Cash and cash equivalents $ 107,254 $ 107,254 $ — $ — $ 107,254 Available-for-sale securities 258,493 — 258,493 — 258,493 Held-to-maturity securities 375,115 — 339,708 — 339,708 Equity securities 436 436 — — 436 Loans held for sale 6,851 — 6,851 — 6,851 Net loans 4,455,329 — — 4,483,665 4,483,665 Restricted investment in bank stocks 6,660 6,660 — 6,660 Accrued interest receivable 27,263 27,263 — — 27,263 Derivative assets 10,814 — 10,814 — 10,814 Financial instruments - liabilities Deposits $ 4,732,202 $ — $ 4,740,814 $ — $ 4,740,814 Short-term borrowings 25,000 — 25,000 — 25,000 Long-term debt (1) 20,462 — 20,369 — 20,369 Subordinated debt 45,587 — 43,246 — 43,246 Accrued interest payable 12,900 12,900 — — 12,900 Derivative liabilities 9,901 — 9,901 — 9,901 (1) Long-term debt excludes finance lease obligations. 37 Table of Contents MID PENN BANCORP, INC. December 31, 2024 Estimated Fair Value (In thousands) Carrying Amount Level 1 Level 2 Level 3 Total Financial instruments - assets Cash and cash equivalents $ 70,564 $ 70,564 $ — $ — $ 70,564 Available-for-sale securities 260,477 — 260,477 — 260,477 Held-to-maturity securities 382,447 — 340,648 — 340,648 Equity securities 428 428 — — 428 Loans held for sale 7,064 — 7,064 — 7,064 Net loans 4,407,556 — — 4,430,623 4,430,623 Restricted investment in bank stocks 7,461 7,461 — 7,461 Accrued interest receivable 26,846 26,846 — — 26,846 Derivative assets 13,708 — 13,708 — 13,708 Financial instruments - liabilities Deposits $ 4,689,927 $ — $ 4,684,548 $ — $ 4,684,548 Short-term debt 2,000 — 2,000 — 2,000 Long-term debt (1) 20,540 — 19,120 — 19,120 Subordinated debt 45,741 — 42,811 — 42,811 Accrued interest payable 13,484 13,484 — — 13,484 Derivative liabilities 11,118 — 11,118 — 11,118 (1) Long-term debt excludes finance lease obligations. The Bank’s outstanding and unfunded credit commitments and financial standby letters of credit were deemed to have no significant fair value as of March 31, 2025 and December 31, 2024. Note 9 - Commitments and Contingencies Guarantees and commitments to extend credit Mid Penn is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. The commitments include various guarantees and commitments to extend credit. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Mid Penn evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary upon extension of credit, is based on management’s credit evaluation of the customer. Standby letters of credit and financial guarantees written are conditional commitments to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to support public and private borrowing arrangements. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loans to customers. Mid Penn had $ 67.5 million and $ 64.3 million of standby letters of credit outstanding as of March 31, 2025 and December 31, 2024, respectively. Mid Penn does not anticipate any losses because of these transactions. The amount of the liability as of March 31, 2025 and December 31, 2024 for payment under standby letters of credit issued was not considered material. Mid Penn is required to estimate expected credit losses for OBS credit exposures which are not unconditionally cancellable. Mid Penn maintains a separate ACL on OBS credit exposures, including unfunded loan commitments and letters of credit, which is included in other liabilities on the accompanying Consolidated Balance Sheets. The ACL - OBS is adjusted as a provision for OBS commitments in provision for credit losses. The estimate includes consideration of the likelihood that funding will occur, an estimate of exposure at default that is derived from utilization rate assumptions using a non-modeled approach, and PD and LGD estimates that are derived from the same models and 38 Table of Contents MID PENN BANCORP, INC. approaches for Mid Penn's other loan portfolio segments described in "Note 4 - Loans and Allowance for Credit Losses - Loans" above, as these unfunded commitments share similar risk characteristics with these loan portfolio segments. The ACL - OBS was $ 2.9 million as of March 31, 2025 and December 31, 2024. A benefit for credit losses - credit commitments of $ 20 thousand and $ 318 thousand was recorded for the three months ended March 31, 2025 and March 31, 2024, respectively. The following table presents the activity in the ACL - OBS by segment for the three March 31, 2025 and December 31, 2024: (in thousands) Balance at December 31, 2024 (Benefit)/Provision for credit loss Three months ended March 31, 2025 1-4 Family Rental $ 16 $ ( 3 ) $ 13 C&I 1,165 157 1,322 CRE NonOwner Occupied 132 ( 23 ) 109 CRE Owner Occupied 98 7 105 Consumer 3 — 3 Farmland 92 20 112 HELOC & Junior Liens 92 3 95 Multifamily 27 ( 5 ) 22 Other Construction & Land 792 ( 132 ) 660 Residential Construction 516 ( 45 ) 471 Residential First Liens 6 1 7 $ 2,939 $ ( 20 ) $ 2,919 (in thousands) Balance at December 31, 2023 (Benefit)/Provision for credit loss Three months ended March 31, 2024 1-4 Family Rental $ 11 $ — $ 11 C&I 1,270 ( 132 ) 1,138 CRE NonOwner Occupied 113 ( 28 ) 85 CRE Owner Occupied 106 14 120 Consumer 3 — 3 Farmland 108 ( 13 ) 95 HELOC & Junior Liens 100 13 113 Multifamily 24 ( 7 ) 17 Other Construction & Land 1,036 ( 108 ) 928 Residential Construction 778 ( 47 ) 731 Residential First Liens 18 ( 10 ) 8 $ 3,567 $ ( 318 ) $ 3,249 Litigation Mid Penn and its subsidiaries are subject to various pending and threatened legal proceedings or other matters arising out of the normal conduct of business in which claims for monetary damages are asserted. As of the date of this report, management, after consultation with legal counsel, does not anticipate that the aggregate ultimate liability arising out of such pending or threatened matters will be material to Mid Penn’s consolidated financial position. On at least a quarterly basis, Mid Penn assesses its liabilities and contingencies in connection with such matters. For those matters where it is probable that Mid Penn will incur losses and the amounts of the losses can be reasonably estimated, Mid Penn records an expense and corresponding liability in its consolidated financial statements. To the extent such matters could result in exposure in excess of that liability, the amount of such excess is not currently estimable. The range of losses for matters where an exposure is not currently estimable or considered probable is not believed to be material in the aggregate. This is based on information currently available to Mid Penn and involves elements of judgment and significant uncertainties. 39 Table of Contents MID PENN BANCORP, INC. While Mid Penn does not believe that the outcome of pending or threatened litigation or other matters will be material to Mid Penn’s consolidated financial position, it cannot rule out the possibility that such outcomes will be material to the consolidated results of operations for a particular reporting period in the future. In addition, regardless of the ultimate outcome of any such legal proceeding, inquiry or investigation, any such matter could cause Mid Penn to incur additional expenses, which could be significant, and possibly material, to Mid Penn’s results of operations in any future period. Note 10 - Debt Short-term FHLB and Correspondent Bank Borrowings Total short-term borrowings were $ 25.0 million and $ 2.0 million as of March 31, 2025 and December 31, 2024, respectively. Short-term borrowings generally consist of federal funds purchased and advances from the FHLB with an original maturity of less than a year. Federal funds purchased from correspondent banks mature in one business day and reprice daily based on the Federal Funds rate. Advances from the FHLB are collateralized by the Bank’s investment in the common stock of the FHLB and by a blanket lien on selected loan receivables comprised principally of real estate secured loans within the Bank’s portfolio totaling $ 2.4 billion at March 31, 2025. The Bank had a short-term borrowing capacity from the FHLB as of March 31, 2025 up to the Bank’s unused borrowing capacity of $ 1.5 billion (equal to $ 1.7 billion of maximum borrowing capacity, less the aggregate amount of FHLB letter of credits securing public funds deposits, and other FHLB advances and obligations outstanding) upon satisfaction of any stock purchase requirements of the FHLB. The Bank also has unused overnight lines of credit with other correspondent banks amounting to $ 35.0 million at March 31, 2025. No draws were made on these lines as of March 31, 2025 and December 31, 2024, respectively. Long-term Debt The following table presents a summary of long-term debt as of March 31, 2025 and December 31, 2024. (Dollars in thousands) March 31, 2025 December 31, 2024 FHLB fixed rate instruments: Due February 2026, 4.51 % $ 20,000 $ 20,000 Due August 2026, 4.80 % 447 523 Due February 2027, 6.71 % 15 17 Total FHLB fixed rate instruments 20,462 20,540 Lease obligations included in long-term debt 3,027 3,063 Total long-term debt $ 23,489 $ 23,603 As a member of the FHLB, the Bank can access a number of credit products which are utilized to provide liquidity. The FHLB fixed rate instruments obtained by the Bank are secured under the terms of a blanket collateral agreement with the FHLB consisting of FHLB stock and qualifying Bank loan receivables, principally real estate secured loans. The Bank also obtains letters of credit from the FHLB to secure certain public fund deposits of municipality and school district customers who agree to use of the FHLB letters of credit as a legally allowable alternative to investment pledging. These FHLB letter of credit commitments totaled $ 113.0 million and $ 156.0 million as of March 31, 2025 and December 31, 2024, respectively. 40 Table of Contents MID PENN BANCORP, INC. Note 11 - Subordinated Debt and Trust Preferred Securities Subordinated Debt Assumed November 2021 with the Riverview Acquisition On November 30, 2021, Mid Penn completed its acquisition of Riverview and assumed $ 25.0 million of subordinated notes (the "Riverview Notes"). In accordance with purchase accounting principles, the Riverview Notes were assigned a fair value premium of $ 2.3 million. The notes are treated as Tier 2 capital for regulatory reporting purposes. The Riverview Notes were entered into by Riverview on October 6, 2020 with certain qualified institutional buyers and accredited institutional investors. The Riverview Notes have a maturity date of October 15, 2030 and initially bear interest, payable semi-annually, at a fixed annual rate of 5.75 % per annum until October 15, 2025. Commencing on that date, the interest rate applicable to the outstanding principal amount due will be reset quarterly to an interest rate per annum equal to the then current three-month SOFR plus 563 bps, payable quarterly until maturity. Mid Penn may redeem the Riverview Notes at par, in whole or in part, at its option, anytime beginning on October 15, 2025, subject to any required regulatory approvals. Subordinated Debt Issued December 2020 On December 22, 2020, Mid Penn entered into agreements for and sold at 100 % of their principal amount, an aggregate of $ 12.2 million of its subordinated notes due December 2030 (the "December 2020 Notes") on a private placement basis to accredited investors. The December 2020 Notes are treated as Tier 2 capital for regulatory capital purposes. The December 2020 Notes bear interest at a rate of 4.5 % per year for the first five years and then float at the Wall Street Journal’s Prime Rate plus 50 bp, provided that the interest rate applicable to the outstanding principal balance during the period the December 2020 Notes are floating will at no time be less than 4.5 %. Interest is payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year, beginning on March 31, 2021. The December 2020 Notes will mature on December 31, 2030 and are redeemable, in whole or in part, without premium or penalty, on any interest payment date on or after December 31, 2025 and prior to December 31, 2030, subject to any required regulatory approvals. Additionally, if (i) all or any portion of the December 2020 Notes cease to be deemed Tier 2 Capital, (ii) interest on the December 2020 Notes fails to be deductible for United States federal income tax purposes, or (iii) Mid Penn will be considered an "investment company," Mid Penn may redeem the December 2020 Notes, in whole but not in part, by giving 10 days’ notice to the holders of the December 2020 Notes. In the event of a redemption described in the previous sentence, Mid Penn will redeem the December 2020 Notes at 100 % of the principal amount of the December 2020 Notes, plus accrued and unpaid interest thereon to but excluding the date of redemption. Holders of the December 2020 Notes may not accelerate the maturity of the December 2020 Notes, except upon the bankruptcy, insolvency, liquidation, receivership or similar event of Mid Penn or Mid Penn Bank, its principal banking subsidiary. Related parties held $ 750 thousand of the December 2020 Notes as of March 31, 2025 and December 31, 2024. Subordinated Debt Issued March 2020 On March 20, 2020, Mid Penn entered into agreements with accredited investors who purchased $ 15.0 million aggregate principal amount of its subordinated notes due March 2030 (the "March 2020 Notes"). As a result of Mid Penn’s merger with Riverview on November 30, 2021, $ 6.9 million of the March 2020 Notes balance was redeemed as Riverview was a holder of the March 2020 Notes. The balance of March 2020 Notes outstanding as of March 31, 2025 was $ 8.1 million. The March 2020 Notes are intended to be treated as Tier 2 capital for regulatory capital purposes. The March 2020 Notes bear interest at a rate of 4.0 % per year for the first five years and then float at the Wall Street Journal’s Prime Rate, provided that the interest rate applicable to the outstanding principal balance during the period the March 2020 Notes are floating will at no time be less than 4.25 %. Interest is payable semi-annually in arrears on June 30 and December 30 of each year, beginning on June 30, 2020, for the first five years after issuance and will be payable quarterly in arrears thereafter on March 30, June 30, September 30 and December 30. The March 2020 Notes will mature on March 30, 2030 and are redeemable in whole or in part, without premium or penalty, at any time on or after March 30, 2025 and prior to March 30, 2030. Additionally, if all or any portion of the March 2020 Notes cease to be deemed Tier 2 Capital, Mid Penn may redeem, on any interest payment date, all or part of the 2020 Notes. In the event of a redemption described in the previous sentence, Mid Penn will redeem the March 2020 Notes at 100 % of the principal amount of the March 2020 Notes, plus accrued and unpaid interest thereon to but excluding the date of redemption. 41 Table of Contents MID PENN BANCORP, INC. Holders of the March 2020 Notes may not accelerate the maturity of the March 2020 Notes, except upon the bankruptcy, insolvency, liquidation, receivership or similar event of Mid Penn or Mid Penn Bank, its principal banking subsidiary. Related parties held $ 1.7 million of the March 2020 Notes as of March 31, 2025 and December 31, 2024. Note 12 - Common Stock and Earnings Per Share Treasury Stock Repurchase Program Mid Penn adopted a treasury stock repurchase program ("Program") initially effective March 19, 2020, and renewed through April 30, 2026 by Mid Penn’s Board of Directors on April 23, 2025. The Program authorizes the repurchase of up to $ 15.0 million of Mid Penn’s outstanding common stock. Under the Program, Mid Penn conducts repurchases of its common stock through open market transactions (which may be by means of a trading plan adopted under SEC Rule 10b5-1) or in privately negotiated transactions. Repurchases under the Program are made at the discretion of management and are subject to market conditions and other factors. There is no guarantee as to the exact number of shares that Mid Penn may repurchase. The Program is able to be modified, suspended or terminated at any time, at Mid Penn’s discretion, based upon a number of factors, including liquidity, market conditions, the availability of alternative investment opportunities and other factors Mid Penn deems appropriate. The Program does not obligate Mid Penn to repurchase any shares. No shares were repurchased in the three months ended March 31, 2025. As of March 31, 2025, Mid Penn had repurchased 440,722 shares of common stock at an average price of $ 22.78 per share under the Program. The Program had approximately $ 5.0 million remaining available for repurchase as of March 31, 2025. Dividend Reinvestment Plan Under Mid Penn’s amended and restated DRIP, 300,000 shares of Mid Penn’s authorized but unissued common stock are reserved for issuance. The DRIP also allows for voluntary cash payments, within specified limits, to be used for the purchase of additional shares. Equity Incentive Plans On May 9, 2023, shareholders approved the 2023 Stock Incentive Plan, which authorizes Mid Penn to grant incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, deferred stock units and performance shares. The 2023 Plan was established for employees and directors of Mid Penn and the Bank, selected by the Compensation Committee of the Board of Directors, to incentivize the further success of the Company, and replaces the 2014 Restricted Stock Plan. The aggregate number of shares of common stock of the Company available for issuance under the Plans is 550,000 shares . As of March 31, 2025, a total of 263,974 restricted shares were granted under the Plans, of which 82,278 shares were unvested. The Plan's shares granted and vested resulted in $ 239 thousand and $ 302 thousand in share-based compensation expense for the three months ended March 31, 2025 and 2024, respectively. Share-based compensation expense relating to restricted stock is calculated using grant date fair value and is recognized on a straight-line basis over the vesting periods of the awards. Restricted shares granted to employees vest in equal amounts on the anniversary of the grant date over the vesting period and the expense is a component of salaries and benefits expense on the Consolidated Statement of Income. The employee grant vesting period is determined by the terms of each respective grant, with vesting periods generally between one and four years . Restricted shares granted to directors have a twelve-month vesting period, and the expense is a component of directors’ fees and benefits within the other expense line item on the Consolidated Statement of Income. 42 Table of Contents MID PENN BANCORP, INC. The following data shows the amounts used in computing basic and diluted earnings per common share: Three Months Ended March 31, (In thousands, except per share data) 2025 2024 Net income $ 13,742 $ 12,133 Weighted average common shares outstanding (basic) 19,355,867 16,567,902 Effect of dilutive unvested restricted stock grants 60,398 45,471 Weighted average common shares outstanding (diluted) 19,416,265 16,613,373 Basic earnings per common share $ 0.71 $ 0.73 Diluted earnings per common share 0.71 0.73 There were no antidilutive instruments at March 31, 2025 and 2024, respectively. 43 Table of Contents MID PENN BANCORP, INC. Note 13 - Segment Reporting Mid Penn operates as a single reportable segment, providing a broad range of banking and financial services to individuals, businesses, and institutional clients. These services include commercial and consumer lending, deposit products, wealth management, insurance, and treasury management solutions. The Chief Executive Officer and the Chief Financial Officer are the Mid Penn Chief Operating Decision Makers ("CODM"). The CODM regularly evaluates financial performance and allocates resources on a consolidated basis. The following table presents certain information reviewed by management: (in thousands) March 31, 2025 March 31, 2024 Net interest income $ 42,509 $ 36,456 Provision (Benefit) for credit losses 301 ( 937 ) Noninterest income 5,239 5,837 Noninterest expense 30,642 28,520 Income taxes 3,063 2,577 Net income 13,742 12,133 Total assets $ 5,546,026 $ 5,330,379 Other Segment Information Revenue Composition: Mid Penn generates revenue primarily from net interest income and non-interest income, including fees from deposit accounts, wealth management, insurance, and treasury services. Capital Allocation & Performance Metrics: The CODM assesses performance based on key financial metrics, including net interest margin, return on average assets ("ROAA"), return on average equity ("ROAE") and core efficiency ratio. 44 Table of Contents MID PENN BANCORP, INC.