What changed in this filing

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Item 1. Business

2026-03-12 compared with 2025-03-13 · 70 added, 52 removed, 320 unchanged (28% of the section changed)

4 unchanged sentences

Mid Penn Bancorp, Inc.

and its wholly owned bank and nonbank subsidiaries are collectively referred to herein as "Mid Penn" or the "Corporation." On December 31, 1991, Mid Penn acquired, as part of the holding company formation, all of the outstanding common stock of Mid Penn Bank, referred to herein as "The Bank", and the Bank became a wholly-owned subsidiary of Mid Penn.

In addition to Mid Penn Bank, Mid Penn maintains five wholly-owned nonbanks subsidiaries:

MPB Financial Services, LLC, which serves as the mid-tier holding company for MPB Risk Services, LLC, a licensed insurance producer, MPB Wealth Management, LLC (which ceased operating during the first quarter of 2024), and MPB Launchpad Fund I, LLC, which was formed to hold certain financial holding company eligible investments;

and its wholly owned bank and nonbank subsidiaries are collectively referred to herein as "Mid Penn" or the "Corporation." On December 31, 1991, Mid Penn acquired, as part of the holding company formation, all of the outstanding common stock of Mid Penn Bank, and the Bank became a wholly-owned subsidiary of Mid Penn.

In addition to Mid Penn Bank, Mid Penn maintains six wholly-owned nonbank subsidiaries:

MPB Financial Services, LLC, that serves as the mid-tier holding company for MPB Risk Services, LLC, a licensed insurance producer, MPB Acquisition Sub I, LLC, which was formed in connection with the acquisition of Cumberland Advisors, LLC.

See "Subsequent Events" for additional information;

MPB Wealth Management, LLC, which ceased operating during the first quarter of 2024;

MPB Launchpad Fund I, LLC, which was formed to hold certain financial holding company eligible investments;

and MPB Realty Holding, LLC, which was formed for purposes of holding certain assets acquired for debts previously contracted.

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Mid Penn’s consolidated financial condition and results of operations consist almost entirely of that of the Bank, which is managed as a single business segment.

At December 31, 2024, Mid Penn had total consolidated assets of $5.5 billion with total deposits of $4.7 billion and total shareholders’ equity of $655.0 million.

The holding company and its nonbank subsidiaries currently do not own or lease any real property.

As of December 31, 2025, Mid Penn had total consolidated assets of $6.1 billion with total deposits of $5.2 billion and total shareholders’ equity of $814.1 million.

As of December 31, 2025, the holding company and its nonbank subsidiaries owned $7.8 million of foreclosed real estate and did not own or lease any other real property.

The Bank owns or leases the banking offices as identified in Part I, Item 2.

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On July 31, 2024, Mid Penn acquired the insurance business and related accounts of, Commonwealth Benefits Group, a full-service employee benefits firm that served 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.

On October 31, 2024, Mid Penn entered into an Agreement and Plan of Merger with William Penn Bancorporation pursuant to which William Penn will merge with and into Mid Penn in an all-stock transaction valued at approximately $107 million, based on Mid Penn’s closing stock price as of October 30, 2024.

The Merger has been approved unanimously by each company’s board of directors and is expected to close in the first half of 2025.

Completion of the transaction is subject to customary closing conditions, including the receipt of required regulatory approvals and the approval of Mid Penn and William Penn shareholders.

Under the terms of the Merger Agreement, shareholders of William Penn will have the right to receive, for each share of common stock, par value $0.01 per share, of William Penn, 0.426 shares of Mid Penn common stock (the “Exchange Ratio”) and cash in lieu of fractional shares, subject to adjustment and proration as described in the Merger Agreement.

On April 30, 2025, Mid Penn completed its acquisition of William Penn Bancorporation through the merger of William Penn with and into Mid Penn.

In connection with this acquisition, William Penn Bank, a wholly-owned subsidiary of William Penn, merged with and into Mid Penn Bank, a wholly-owned subsidiary of Mid Penn.

This transaction included the acquisition of 12 branches, further expanding Mid Penn's presence in the Philadelphia region and surrounding counties in Pennsylvania and New Jersey.

The merger was an all-stock transaction valued at approximately $103.2 million, based on the Mid Penn common stock closing price of $29.05 on April 30, 2025.

Each share of William Penn common stock issued and outstanding as of April 30, 2025, was converted into 0.426 shares of Mid Penn common stock.

As a result of the acquisition, Mid Penn issued 3,506,795 shares of Mid Penn common stock.

On May 12, 2025, Mid Penn acquired the insurance business and related accounts of Charis Insurance Group, Inc., which provides business, home and auto insurance throughout central and southern Pennsylvania, for a cash purchase price of $4.0 million.

On September 24, 2025, Mid Penn entered into a Merger Agreement with 1st Colonial in a cash and stock deal valued at nearly $101 million.

The Merger Agreement provides that, upon the terms and subject to the conditions set forth therein, 1st Colonial will merge with and into Mid Penn, with Mid Penn surviving the Merger.

Promptly following the Merger, 1st Colonial's wholly owned bank subsidiary, 1st Colonial Community Bank, will merge with and into the Bank.

Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger, each share of 1st Colonial's common stock, par value $0.0 per share, issued and outstanding immediately prior to the effective time of the Merger, other than certain shares held by Mid Penn, will be converted into the right to receive, at the election of the holder of such shares of 1st Colonial common stock, and subject to adjustment and proration as described in the Merger Agreement, either (a) 0.6945 of a share of Mid Penn common stock and cash in lieu of fractional shares or (b) $18.50 in cash.

The acquisition was completed subsequent to year end.

See "Subsequent Events" for additional information.

On September 25, 2025, Mid Penn entered into an agreement to acquire Cumberland Advisors, Inc.

for a purchase price at closing of $5.5 million.

Seventy percent of the purchase price was paid in Mid Penn common stock and the balance in cash.

The agreement provides for the potential cash payment by Mid Penn of up to an additional $1.0 million pursuant to an earn-out, and the issuance of approximately 300,000 stock appreciation rights having a maximum aggregate value of $1.2 million.

Cumberland Advisors, a registered investment advisory firm, recorded a year-to-date annualized revenue of $9.0 million as of the quarter ended June 30, 2025, and brings approximately $3.2 billion of new assets under management to the combined company.

The acquisition was completed subsequent to year end.

See "Subsequent Events" for additional information.

Additional information related to the recent acquisitions can be found in "Note 2 - Business Combinations", to the Consolidated Financial Statements contained in Part II, Item 8 of this report.

As of December 31, 2024, the Bank operates 42 full-service retail banking locations in the Pennsylvania counties of Berks, Blair, Bucks, Chester, Clearfield, Cumberland, Dauphin, Fayette, Huntingdon, Lancaster, Lehigh, Luzerne, Montgomery, Perry, Schuylkill and Westmoreland, along with 3 full-service retail banking locations in the New Jersey counties of Middlesex and Monmouth.

One new full-service retail banking location opened in Camden County, New Jersey in January 2025.

As of December 31, 2025, the Bank operates 51 full-service retail banking locations throughout central and southeastern Pennsylvania and 8 full-service retail banking locations in central and southern New Jersey.

Mid Penn’s primary business consists of attracting deposits and loans from the Bank’s network of community banking offices.

The Bank engages in 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 and local government loans and various types of time and demand deposits.

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government loans and various types of time and demand deposits.

The Pennsylvania Department of Banking and Securities and the Federal Deposit Insurance Corporation supervise the Bank.

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Business Strategy

The Bank provides services to commercial businesses and real estate investors, consumers, nonprofit organizations, and municipalities through its 45 full-service retail banking properties, one loan production office, one wealth management office, two corporate administrations offices, and one operations facility, primarily based in Pennsylvania.

Mid Penn’s primary markets reflect a diversified manufacturing and services base across sixteen Pennsylvania counties and two counties in New Jersey, including having several offices in and around the state capital region of Harrisburg.

The Bank provides services to commercial businesses and real estate investors, consumers, nonprofit organizations, and municipalities through its 59 full-service retail banking properties, and 13 administrative properties, primarily based in Pennsylvania.

Mid Penn’s primary markets reflect a diversified manufacturing and services base across nineteen Pennsylvania counties and five counties in New Jersey, including having several offices in and around the state capital region of Harrisburg.

The Bank emphasizes developing long-term customer relationships, maintaining high quality service, and providing prompt responses to customer needs.

Mid Penn believes that local relationship building and its prudent approach to lending are important factors in the success and growth of Mid Penn.

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Human Capital

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The Corporation and its employees are not subject to a collective bargaining agreement and the Corporation believes it enjoys good relations with its employees.

Diversity & Inclusion

The Corporation believes that a diverse and inclusive workforce fosters an environment where everyone can thrive and be successful.

Inclusion & Belonging

The Corporation believes that an inclusive workforce fosters a culture and environment where everyone can thrive and be successful.

As of December 31, 2025, approximately 65% of our workforce is female.

Bank leadership has seen the benefits of Employee Resource Groups ("ERG") within our organization.

In 2022, Mid Penn formalized committee members on our Women’s Leadership Network, Diversity, Equality, and Inclusion ("DEI"), and our Culture Committees.

Throughout 2024, the entire organization has benefited from the contributions of these groups.

In 2022, Mid Penn formalized committee members on our Women’s Leadership Network and our Culture Committees.

Throughout 2025, the entire organization has benefited from the contributions of these groups, even expanding the groups to include a Young Professionals group.

Each group allows employees to come together based on shared characteristics to address common challenges and to drive positive impact within the workforce.

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This group serves as a community for mothers to connect, share like experiences and offer support to each other as they balance their personal and professional lives.

Our DEI group has laid the groundwork to help create a more diverse and inclusive workplace by promoting understanding, respect, and awareness of different cultures, backgrounds, and perspectives.

Our Culture Committee has focused on contributing to a positive organizational culture by fostering open communication, collaboration, and a sense of community;

this sense of community is important to Mid Penn as we continue to expand geographically.

The Culture Committee also supports wellness initiatives by creating initiatives, programs, and resources to encourage physical, mental, and emotional wellness.

The committee aims to support healthy work-life balance, understand and better utilize our benefit programs, and foster a positive, wellness-oriented workplace culture.

The Culture Committee also supports wellness initiatives by creating programs, and resources to encourage physical, mental, and emotional wellness.

The Culture Committee aims to support healthy work-life balance, understand and better utilize our benefit programs, and foster a positive, wellness-oriented workplace culture.

Our Young Professionals group connects early-career employees to build connections, develop skills, and feel engaged while creating a pipeline of future leaders in the Company.

We have found that employees who belong to any of our ERGs are more engaged, are developing leadership skills, and are gaining new experiences through volunteer and networking opportunities.

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The education and development of our employees is a priority, and we continue to invest in tools, education programs, certifications, and continuing education to help our employees build their knowledge, skills and experience.

We provide in-house training to employees on a variety of topics, including leadership and professional development, cybersecurity, risk, compliance, and technology.

Through Mid Penn University, we provide in-house training to employees on a variety of topics, including leadership and professional development, cybersecurity, risk, compliance, and emerging technologies.

On an ongoing basis, we promote the health and wellness of our employees by strongly encouraging work-life balance.

Our benefits package includes health care coverage, retirement benefits, life and disability insurance, tuition-reimbursement, parental leave, wellness programs, and paid time off.

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Employee retention helps us operate efficiently and offers continuity to our customers and the community.

We believe our concern for our employees’ well-being, supporting our employees’ career goals, offering competitive wages, and providing valuable benefits aids in retention of our employees.

We believe our concern for our employees’ well-being, supporting our employees’ career goals, offering competitive wages, and providing valuable benefits aids in the retention of our employees.

Community Involvement

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In 2025, our employees demonstrated their commitment to our communities by personally giving more than $69 thousand to charitable organizations within Mid Penn’s footprint through our Dress Down Friday program.

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Lending Activities

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Lenders are provided with detailed underwriting policies for all types of credit risks accepted by the Bank and must obtain appropriate internal approvals for credit extensions.

The Bank also maintains strict documentation requirements and robust credit quality assurance practices in order to identify credit portfolio weaknesses as early as possible, so any exposures that are discovered might be mitigated or potential losses reduced.

The Bank also maintains strict documentation requirements and robust credit quality assurance practices to identify credit portfolio weaknesses as early as possible, so any exposures that are discovered might be mitigated or potential losses reduced.

The Bank generally secures its loans with real estate, with such collateral values dependent and subject to change based on real estate market conditions within its market area.

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Wholesale borrowing sources include advances from the Federal Home Loan Bank of Pittsburgh, overnight borrowings from the Bank’s other correspondent banking relationships, and advances from the Federal Reserve’s Discount Window.

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All borrowings, except for lines of credit with the Bank’s correspondent banks, require collateral in the form of loans or securities.

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Mid Penn’s ability to attract retail funds in the future will continue to be impacted by the public’s appetite for the safety of insured or local investments versus the returns offered by alternative choices as part of their personal investment mix.

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The financial services and banking business is highly competitive, and the profitability of Mid Penn depends principally upon the Corporation’s ability to successfully compete in its market area.

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Federal and state banking laws contain numerous provisions affecting various aspects of the business and operations of Mid Penn and the Bank.

Mid Penn is subject to, among others, the regulations of the Securities and Exchange Commission and the Board of Governors of the Federal Reserve System (the "Federal Reserve").

Mid Penn is subject to, among others, the regulations of the SEC and the Board of Governors of the Federal Reserve System (the "Federal Reserve").

The Bank is subject to, among others, the regulations of the Pennsylvania Department of Banking and Securities and the FDIC.

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The Federal Reserve has broad enforcement powers over financial and bank holding companies, including the power to impose substantial fines and civil penalties.

MID PENN BANCORP, INC.

The BHCA requires Mid Penn to file an annual report with the Federal Reserve regarding the holding company and its subsidiary bank.

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In addition, the BHCA restricts the activities in which financial or bank holding companies may engage directly or through nonbank subsidiaries.

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Gramm-Leach-Bliley Financial Modernization Act

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Under risk-based capital requirements for financial or bank holding companies, Mid Penn is required to maintain a minimum ratio of Total Capital to risk-weighted assets (including certain off-balance-sheet activities, such as standby letters of credit) of 10.5%.

At least half of the total capital is to be composed of common equity, retained earnings and qualifying perpetual preferred stock, less goodwill ("Tier 1 Capital").

At least half of the Total Capital is to be composed of common equity, retained earnings and

MID PENN BANCORP, INC.

qualifying perpetual preferred stock, less goodwill ("Tier 1 Capital").

The remainder may consist of subordinated debt, non-qualifying preferred stock, and a limited amount of the loan loss allowance ("Tier 2 Capital").

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The requirements also provide that bank holding companies experiencing internal growth or making acquisitions will be expected to maintain strong capital positions substantially above the minimum supervisory levels without significant reliance on intangible assets.

Furthermore, the requirements indicate that the Federal Reserve will continue to consider a "Tangible Tier 1

MID PENN BANCORP, INC.

Leverage Ratio" (deducting all intangibles) in evaluating proposals for expansion or new activity.

Furthermore, the requirements indicate that the Federal Reserve will continue to consider a "Tangible Tier 1 Leverage Ratio" (deducting all intangibles) in evaluating proposals for expansion or new activity.

As of December 31, 2025, Mid Penn has met these leverage requirements, and the Federal Reserve has not advised Mid Penn of any specific minimum Tier 1 leverage ratio requirement.

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If an institution is deemed "critically undercapitalized" and continues in that category for four quarters, the statute requires, with certain limited exceptions, that the institution be placed in receivership.

MID PENN BANCORP, INC.

Mid Penn and the Bank are subject to the Basel III Rules that are based upon the final framework of the Basel Committee for strengthening capital and liquidity regulation.

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As of December 31, 2025, the Corporation and the Bank exceeded the minimum capital requirements, including the capital conservation buffer, as prescribed in the Basel III Rules.

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The Basel III Rules provide for a number of required deductions from and adjustments to CET1.

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In addition, the agencies adopted regulations that authorize an agency to order an institution that has been given notice by an agency that it is not satisfying any of such safety and soundness standards to submit a compliance plan.

If an institution is not satisfying certain safety and soundness standards and fails to submit to the banking regulatory agency an acceptable compliance plan or fails to implement an accepted plan, the agency may issue an order directing action to correct the deficiency and may issue an order directing other actions be taken, including restricting asset growth, restricting interest rates paid on deposits, restricting dividend payments to shareholders, and requiring an increase in the institution’s ratio of tangible equity to assets.

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tangible equity to assets.

For the periods reported in this Form 10-K and in the period subsequent to December 31, 2025, up to the date of the filing of this Form 10-K, Mid Penn was not subject to any such bank regulatory orders.

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• Total CRE loans as defined in the CRE guidance represent 300 percent or more of the institution’s Total Capital, and the outstanding balance of the institution’s CRE loan portfolio has increased by 50 percent or more during the prior 36 months.

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If the Bank's portfolio exceeds the guidelines mentioned above, additional risk management practices may be needed.

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Banks that have experienced significant growth in their CRE lending will receive closer regulatory review than those that have not.

Mid Penn's underwriting process for commercial real estate 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.

Mid Penn's underwriting process for CRE 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.

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Additional support offered by guarantors is also considered when applicable.

Commercial real estate loans increased 9.2% from December 31, 2023 to December 31, 2024.

Commercial real estate loans were the largest driver of the $190.3 million growth in the total loan portfolio.

Non-owner occupied commercial real estate loan exposure represents 28.2% of total loan balances and is primarily limited to suburban offices.

CRE loans increased 8.7% from December 31, 2024 to December 31, 2025.

CRE loans were the largest driver of the $419.8 million growth in the total loan portfolio.

As of December 31, 2025, nonowner occupied CRE loan exposure represents 28.0% of total loan balances and is primarily comprised of retail, office, and industrial properties.

Payment of Dividends and Other Restrictions

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The holding company and the Bank were not subject to any such dividend prohibitions during the years ended December 31, 2025, 2024, and 2023.

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Deposit Insurance

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As the asset base of the banking industry is larger than the deposit base, the range of assessment rates is a low of 2.5 bp and a high of 45 bp, per $100 of assets.

MID PENN BANCORP, INC.

The FDIC was required under the Dodd-Frank Act to establish assessment rates that allowed the DIF to achieve a reserve ratio of 1.35% of Insurance Fund insured deposits by September 2020.

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For example, the Community Reinvestment Act is designed to encourage services, investments, and lending activities in low and moderate income areas.

Federal Bank regulatory agencies passed a final rule in August 2023 to strengthen and modernize the regulations to better achieve the purposes of the law.

These changes will begin to take effect on January 1, 2026.

The Home Mortgage Disclosure Act and the Equal Credit Opportunity Act attempt to minimize lending decisions based on impermissible criteria, such as race or gender.

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An "affiliate" of a bank or savings institution is any company or entity that controls, is controlled by, or is under common control with the bank or savings institution.

Generally, a subsidiary of a depository institution that is not also a depository institution is not treated as an affiliate of the bank for purposes of Sections 23A and 23B.

Generally, a subsidiary of a depository

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institution that is not also a depository institution is not treated as an affiliate of the bank for purposes of Sections 23A and 23B.

Sections 23A and 23B are intended to protect insured depository institutions from suffering losses arising from transactions with non-insured affiliates, by limiting the extent to which a bank or its subsidiaries may engage in covered transactions with any one affiliate and with all affiliates of the bank in the aggregate, and requiring that such transactions be on terms that are consistent with safe and sound banking practices.

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government to detect and prosecute international money laundering and the financing of terrorism.

Under Title III of the USA Patriot Act, also known as the International Money Laundering Abatement and Anti-Terrorism Financing Act of 2001, all financial institutions, including Mid Penn and the Bank, are required in general to identify their customers, adopt formal and comprehensive anti-money laundering programs, scrutinize or prohibit altogether certain transactions of special concern, and be prepared to respond to

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inquiries from U.S.

law enforcement agencies concerning their customers and their transactions.

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Dodd-Frank also permanently raised the current standard maximum deposit insurance amount to $250,000, established strengthened capital standards for banks, disallowed certain trust preferred securities from qualifying as Tier 1 Capital (subject to certain grandfather provisions for existing trust preferred securities), established new minimum mortgage underwriting standards, granted the Federal Reserve the power to regulate debit card interchange fees, and implemented corporate governance changes.

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Effects of Government Policy and Potential Changes in Regulation

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From time to time, legislation is enacted that has the effect of increasing the compliance and operations requirements and the cost of doing business, changing the tax structure applicable to Mid Penn, limiting or expanding permissible activities, or affecting the competitive balance between banks and other financial institutions.

Proposals to change the laws and regulations governing the operations and taxation of banks, bank holding companies and other financial institutions are

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frequently made in Congress and the various bank regulatory agencies.

Proposals to change the laws and regulations governing the operations and taxation of banks, bank holding companies and other financial institutions are frequently made in Congress and the various bank regulatory agencies.

Mid Penn cannot predict the likelihood of any major changes or the impact such changes might have on Mid Penn, the Bank, or the nonbank subsidiaries.

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Mid Penn has established policies, procedures, and systems designed to promote compliance with these regulations.

Section 404 of SOX requires publicly held companies to document, test and certify that their internal control systems over financial reporting are effective.

Section 404 of SOX requires publicly held companies to document, test and certify that their internal control systems over financial reporting

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are effective.

Effective for year-end financial reports beginning with December 31, 2017, Mid Penn is subject to the independent attestation requirement under Section 404 of the SOX.

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The SEC’s Internet site address is www.sec.gov.

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Mid Penn’s headquarters are located at 2407 Park Drive, Harrisburg, Pennsylvania 17110, and its telephone number is 1-866-642-7736.

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

What changed 10-K

Item 1. Business