What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2024-02-28 compared with 2023-02-22 · 530 added, 622 removed, 1704 unchanged (40% of the section changed)

7 unchanged sentences

Consolidated Statements of Income

Consolidated Statements of Comprehensive Income

Consolidated Statements of Comprehensive Income (Loss)

Consolidated Statements of Changes in Stockholders’ Equity

7 unchanged sentences

We have audited the accompanying consolidated balance sheets of Origin Bancorp, Inc.

(the Company) as of December 31, 2022 and 2021, the related consolidated statements of income, comprehensive income (loss), changes in stockholders’ equity and cash flows for each of the years in the three-year period ended December 31, 2022, and the related notes (collectively referred to as the “financial statements”).

(the Company) as of December 31, 2023 and 2022, and the related consolidated statements of income, comprehensive income (loss), changes in stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2023, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

(2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and our report dated February 22, 2023, expressed an unqualified opinion thereon .

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 28, 2024 expressed an unqualified opinion thereon.

Basis for Opinion

18 unchanged sentences

Together these amounts represent the allowance for credit losses (“ACL”).

Report of Independent Registered Public Accounting Firm

As more fully described in Notes 1, 3, 4, and 18 to the Company’s consolidated financial statements, the Company estimates its exposure to expected credit losses as of the balance sheet date, for existing financial instruments held at amortized cost, securities classified as available for sale, and off-balance sheet exposures, such as unfunded loan commitments, letters of credit, and other financial guarantees that are not unconditionally cancellable by the Company.

23 unchanged sentences

• Evaluated the overall reasonableness of assumptions used by management considering trends identified within peer groups;

Report of Independent Registered Public Accounting Firm

• Evaluated the accuracy and completeness of Accounting Standards Update 2016-13, Financial Instruments – Credit Losses (Topic 326) , disclosures in the consolidated financial statements;

• Evaluated the accuracy and completeness of Accounting Standards Codification Topic 326, Financial Instruments – Credit Losses , disclosures in the consolidated financial statements;

• Evaluated credit quality trends in delinquencies, non-accruals, charge-offs, and loan risk ratings;

1 unchanged sentence

• Evaluated documentation prepared to assess the methodology utilized by third party performing the ACL calculation for securities for reasonableness.

As described in Note 3 to the Company’s consolidated financial statements, the Company consummated the acquisition of BT Holdings, Inc.

and its wholly-owned subsidiary, BTH Bank, on August 1, 2022, resulting in goodwill of approximately $94.5 million being recognized on the Company’s consolidated balance sheet.

As part of the acquisition, management assessed that the acquisition qualified as a business combination and all identifiable assets and liabilities acquired were valued at fair value as part of the purchase price allocation as of the acquisition date.

The identification and valuation of such acquired assets and assumed liabilities requires management to exercise significant judgment.

Management utilized outside vendors to assist with estimating the fair value.

We identified the consummated acquisition and the valuation of acquired assets and assumed liabilities as a critical audit matter.

Auditing the acquired assets and assumed liabilities and other acquisition-related considerations involved a high degree of subjectivity in evaluating management’s fair value estimates and purchase price allocations, including the use of our internal valuation specialists.

The primary procedures we performed to address this critical audit matter included:

• Obtained and read the executed Agreement and Plan of Merger documents to gain an understanding of the underlying terms of the consummated acquisition;

• Testing the design and operating effectiveness of controls including:

◦ Proper approval of the acquisition,

◦ Completeness and accuracy of opening balance sheet items,

◦ Accuracy of the loan level data,

◦ Accuracy of the valuations of significant assets acquired and liabilities assumed,

◦ Completeness and accuracy of the purchase price allocation, including tax impact,

◦ Completeness and accuracy of day 1 journal entries and general ledger mapping,

◦ Gap controls are in place from the acquisition date through the date of conversion,

• Assessed management’s application of accounting guidance related to the business combination and management’s determination of whether the transaction was an acquisition of a business as defined within the ASC 805, Business Combinations , framework;

• Assessed the completeness and accuracy of management’s purchase accounting model, including the balance sheet acquired and related fair value purchase price allocations made to identified assets acquired and liabilities assumed;

• Obtained and evaluated significant outside vendor valuation estimates, and challenging management’s review of the appropriateness of the valuations including but not limited to, testing critical inputs, assumptions applied and valuation models utilized by the outside vendors;

• Tested the completeness and accuracy of management’s calculation of total consideration paid;

Report of Independent Registered Public Accounting Firm

• Tested the accuracy of the goodwill calculation resulting from the acquisition, which was the difference between the total consideration paid and the fair value of the net assets acquired;

• Utilized internal valuation specialists to assist with testing the related fair value valuations and purchase price allocations made to identified assets acquired and liabilities assumed;

• Read and evaluated the adequacy of the disclosures made in the notes to the Company’s consolidated financial statements.

/s/ FORVIS, LLP (Formerly BKD, LLP)

/s/ FORVIS, LLP

We have served as the Company’s auditor since 2016.

9 unchanged sentences

Available for sale 1,253,631 1,641,484

Held to maturity, net allowance for credit losses of $ 899 and $ 167 at December 31, 2022 and 2021, respectively (fair value of $ 11,970 and $ 25,117 at December 31, 2022 and 2021, respectively)

Held to maturity, net allowance for credit losses of $ 63 and $ 899 at December 31, 2023, and December 31, 2022, respectively (fair value of $ 10,848 and $ 11,970 at December 31, 2023, and December 31, 2022, respectively)

11,615 11,275

2 unchanged sentences

Non-marketable equity securities held in other financial institutions 55,190 67,378

Loans held for sale ($ 25,389 and $ 37,032 at fair value at December 31, 2022 and 2021, respectively)

Loans held for sale ($ 16,852 and $ 25,389 at fair value at December 31, 2023, and December 31, 2022, respectively)

16,852 49,957

Loans, net of allowance for credit losses of $ 87,161 and $ 64,586 at December 31, 2022 and 2021, respectively

Loans, net of allowance for credit losses of $ 96,868 and $ 87,161 at December 31, 2023, and December 31, 2022, respectively

7,564,076 7,002,861

20 unchanged sentences

50,000,000 shares authorized;

30,746,600 and 23,746,502 shares issued at December 31, 2022 and 2021, respectively)

30,986,109 and 30,746,600 shares issued at December 31, 2023, and December 31, 2022, respectively)

154,931 153,733

1 unchanged sentence

Retained earnings 500,419 435,416

Accumulated other comprehensive (loss) income ( 159,875 ) 5,729

Accumulated other comprehensive loss ( 121,023 ) ( 159,875 )

Total stockholders’ equity 1,062,905 949,943

4 unchanged sentences

(Dollars in thousands, except per share amounts)

Year Ended December 31,

Years Ended December 31,

2023 2022 2021

15 unchanged sentences

Noninterest income

Service charges and fees 17,669 15,049 12,998

Insurance commission and fee income 25,085 22,869 13,098

Service charges and fees 18,803 17,669 15,049

Mortgage banking revenue 3,356 6,722 12,927

Other fee income 3,871 3,530 2,879

Gain on sales of securities, net 1,664 1,748 580

Loss on sales and disposals of other assets, net ( 175 ) ( 185 ) ( 1,213 )

Limited partnership investment (loss) income ( 199 ) 5,701 78

Swap fee income 1,277 457 814

(Loss) gain on sales of securities, net ( 11,635 ) 1,664 1,748

Limited partnership investment (loss) income 405 ( 199 ) 5,701

Gain (loss) on sales and disposals of other assets, net 64 ( 175 ) ( 185 )

Change in fair value of equity investments 10,096 — —

Other income 7,013 4,737 10,162

4 unchanged sentences

(Dollars in thousands, except per share amounts)

Year Ended December 31,

Years Ended December 31,

2023 2022 2021

3 unchanged sentences

Data processing 11,590 10,456 9,117

Intangible asset amortization 9,628 5,488 844

Office and operations 10,834 8,120 6,399

Loan-related expenses 6,097 7,688 6,316

Professional services 5,931 3,813 3,644

Electronic banking 3,958 3,563 3,686

Loan-related expenses 5,035 6,097 7,688

Advertising and marketing 5,986 4,431 3,438

Electronic banking 4,712 3,958 3,563

Franchise tax expense 3,334 3,582 2,538

Regulatory assessments 6,456 3,547 2,904

Intangible asset amortization 5,488 844 1,060

Communications 1,527 1,246 1,574

9 unchanged sentences

ORIGIN BANCORP, INC.

Consolidated Statements of Comprehensive (Loss) Income

Consolidated Statements of Comprehensive Income (Loss)

(Dollars in thousands)

Year Ended December 31,

Years Ended December 31,

2023 2022 2021

Net income $ 83,800 $ 87,715 $ 108,546

Other comprehensive (loss) income

Other comprehensive income (loss)

Securities available for sale and transferred securities:

Net unrealized holding (loss) gain arising during the period ( 209,097 ) ( 24,061 ) 25,646

Net losses realized as a yield adjustment in interest on investment securities ( 10 ) ( 10 ) ( 10 )

Reclassification adjustment for net gain included in net income ( 1,664 ) ( 1,748 ) ( 580 )

Change in the net unrealized (loss) gain on investment securities, before tax ( 210,771 ) ( 25,819 ) 25,056

Income tax (benefit) expense related to net unrealized (loss) gain arising during the period ( 44,262 ) ( 5,422 ) 5,262

Change in the net unrealized (loss) gain on investment securities, net of tax ( 166,509 ) ( 20,397 ) 19,794

Net unrealized holding gain (loss) arising during the period 37,811 ( 209,097 ) ( 24,061 )

Reclassification adjustment for net (gain) loss included in net income 11,635 ( 1,664 ) ( 1,748 )

Change in the net unrealized gain (loss) on available for sale investment securities, before tax 49,446 ( 210,761 ) ( 25,809 )

Net gain realized as a yield adjustment in interest on transferred investment securities ( 10 ) ( 10 ) ( 10 )

Change in the net unrealized gain (loss) on investment securities, before tax 49,436 ( 210,771 ) ( 25,819 )

Income tax expense (benefit) related to net unrealized gain (loss) arising during the period 10,382 ( 44,262 ) ( 5,422 )

Change in the net unrealized gain (loss) on investment securities, net of tax 39,054 ( 166,509 ) ( 20,397 )

Cash flow hedges:

Net unrealized gain (loss) arising during the period 1,161 400 ( 739 )

Reclassification adjustment for gain (loss) included in net income 15 ( 204 ) ( 134 )

Change in the net unrealized gain (loss) on cash flow hedges, before tax 1,146 604 ( 605 )

Income tax expense (benefit) related to net unrealized gain (loss) on cash flow hedges 241 127 ( 127 )

Change in net unrealized position on cash flow hedges, net of tax 905 477 ( 478 )

Other comprehensive (loss) income, net of tax ( 165,604 ) ( 19,920 ) 19,316

Comprehensive (loss) income $ ( 77,889 ) $ 88,626 $ 55,673

Net unrealized gain arising during the period 867 1,161 400

Reclassification adjustment for net (gain) loss included in net income ( 1,123 ) 15 ( 204 )

Change in the net unrealized (loss) gain on cash flow hedges, before tax ( 256 ) 1,146 604

Income tax expense related to net unrealized (loss) gain on cash flow hedges ( 54 ) 241 127

Change in net unrealized net (loss) gain on cash flow hedges, net of tax ( 202 ) 905 477

Other comprehensive income (loss), net of tax 38,852 ( 165,604 ) ( 19,920 )

Comprehensive income (loss) $ 122,652 $ ( 77,889 ) $ 88,626

The accompanying notes are an integral part of these consolidated financial statements.

11 unchanged sentences

— — — 108,546 — 108,546

Other comprehensive income, net of tax

— — — — 19,316 19,316

Impact of adoption of ASU 2016-13 - CECL

— — — ( 760 ) — ( 760 )

Recognition of stock compensation, net

56,235 281 2,287 — — 2,568

Dividends declared - common stock ($ 0.3775 per share)

— — — ( 8,870 ) — ( 8,870 )

Repurchase of common stock

( 30,868 ) ( 154 ) ( 569 ) — — ( 723 )

Balance at December 31, 2020 23,506,312 117,532 237,341 266,628 25,649 647,150

— — — 108,546 — 108,546

Other comprehensive loss, net of tax — — — — ( 19,920 ) ( 19,920 )

Recognition of stock compensation, net

100,410 502 ( 730 ) — — ( 228 )

Stock based compensation expense — — 2,295 — — 2,295

Stock based compensation shares issued, net of shares withheld 12,514 63 ( 63 ) — — —

Exercise of stock options, net of shares withheld 87,896 439 ( 2,962 ) — — ( 2,523 )

Stock Issuance - Lincoln Agency Acquisition 125,386 627 4,646 — — 5,273

7 unchanged sentences

Other comprehensive loss, net of tax — — — — ( 165,604 ) ( 165,604 )

Recognition of stock compensation, net 205,188 1,025 6,186 — — 7,211

Stock based compensation expense — — 3,449 — — 3,449

Stock based compensation shares issued, net of shares withheld 36,868 184 ( 184 ) — — —

Exercise of stock options, net of shares withheld 142,231 711 2,185 — — 2,896

Shares issued under employee stock purchase program 26,089 130 736 — — 866

Options assumed - BTH Merger — — 13,687 — — 13,687

3 unchanged sentences

Balance at December 31, 2022 30,746,600 153,733 520,669 435,416 ( 159,875 ) 949,943

Net income — — — 83,800 — 83,800

Other comprehensive income, net of tax — — — — 38,852 38,852

Stock-based compensation expense — — 5,281 — — 5,281

Stock based compensation shares issued, net of shares withheld 60,329 302 ( 696 ) — — ( 394 )

Exercise of stock options, net of shares withheld 132,967 665 2,437 — — 3,102

Shares issued under employee stock purchase program 46,213 231 887 — — 1,118

Dividends declared - common stock ($ 0.60 per share)

— — — ( 18,797 ) — ( 18,797 )

Balance at December 31, 2023 30,986,109 $ 154,931 $ 528,578 $ 500,419 $ ( 121,023 ) $ 1,062,905

The accompanying notes are an integral part of these consolidated financial statements.

2 unchanged sentences

(Dollars in thousands)

Year Ended December 31,

Years Ended December 31,

Cash flows from operating activities:

7 unchanged sentences

Amortization of investments in tax credit funds 1,842 1,659 1,825

Gain on sale of securities, net ( 1,664 ) ( 1,748 ) ( 580 )

Deferred income tax expense (benefit) 18,309 6,279 ( 11,884 )

Loss (gain) on sale of securities, net 11,635 ( 1,664 ) ( 1,748 )

Deferred income tax expense 27,714 18,309 6,279

Stock-based compensation expense 5,281 3,449 2,295

3 unchanged sentences

Mortgage servicing rights valuation adjustment 4,089 ( 1,219 ) 2,593

Net (gain) loss on disposals of premises and equipment ( 19 ) 82 72

Net loss (gain) on disposals of premises and equipment 2 ( 19 ) 82

Increase in the cash surrender value of life insurance ( 865 ) ( 688 ) ( 810 )

Gain on equity securities without a readily determinable fair value ( 10,096 ) — ( 19 )

Net losses on sales and write-downs of other real estate owned 194 103 1,141

Net (gain) losses on sales and write-downs of other real estate owned ( 66 ) 194 103

Gain on fair value of previously held interest in Lincoln Agency — — ( 5,213 )

Other operating activities, net ( 3,207 ) 6,432 ( 3,142 )

Net change in operating leases ( 770 ) ( 3 ) 124

(Increase) decrease in other assets ( 6,627 ) ( 2,099 ) 1,731

Increase (decrease) in other liabilities 7,285 ( 1,105 ) 4,577

Net cash provided by operating activities 129,921 145,649 171,486

7 unchanged sentences

Pay downs of securities carried at fair value 285 275 3,243

Net (purchases) sales of non-marketable equity securities held in other financial institutions ( 15,818 ) 17,583 ( 22,401 )

Net redemption (purchases) of non-marketable equity securities held in other financial institutions 23,980 ( 15,818 ) 17,583

Originations of mortgage warehouse loans ( 6,470,400 ) ( 9,126,356 ) ( 16,121,464 )

13 unchanged sentences

(Dollars in thousands)

Year Ended December 31,

Years Ended December 31,

Cash flows from financing activities:

2023 2022 2021

Net (decrease) increase in deposits $ ( 361,450 ) $ 819,378 1,522,703

Net increase (decrease) in deposits $ 475,423 $ ( 361,450 ) $ 819,378

Repayments on long-term FHLB advances ( 266 ) ( 250,257 ) ( 13,716 )

Proceeds from Federal Reserve Bank Paycheck Protection Program Liquidity Facility ("PPPLF") — — 319,257

Repayments on PPPLF — — ( 319,257 )

Proceeds from short-term FHLB advances 6,065,000 10,025,000 5,726,000

Repayments on short-term FHLB advances ( 6,545,000 ) ( 9,475,000 ) ( 6,376,000 )

Issuance of subordinated debentures, net — — 147,374

Net increase in other short-term borrowings 30,000 — —

Net increase (decrease) in securities sold under agreements to repurchase 8,339 1,039 ( 8,309 )

Repurchase of subordinated debentures, net ( 4,729 ) — —

Maturities of subordinated debentures ( 2,625 ) — —

(Repayments on) proceeds from other short-term borrowings ( 30,000 ) 30,000 —

Net (decrease) increase in securities sold under agreements to repurchase ( 20,797 ) 8,339 1,039

Dividends paid ( 18,567 ) ( 15,887 ) ( 11,525 )

1 unchanged sentence

Common stock repurchased — — ( 1,256 )

Net cash (provided by) used in financing activities ( 36,307 ) 144,066 2,200,541

Net cash (used in) provided by financing activities ( 78,421 ) ( 36,307 ) 144,066

Net (decrease) increase in cash and cash equivalents ( 78,531 ) ( 346,646 ) 328,404

2 unchanged sentences

Interest paid $ 215,479 $ 50,104 $ 26,265

Income taxes (refund) paid ( 6,261 ) 21,164 24,974

Income taxes paid (refund) 383 ( 6,261 ) 21,164

Significant non-cash transactions:

1 unchanged sentence

Real estate acquired in settlement of loans 3,243 675 3,889

(Decrease) increase in GNMA repurchase obligation ( 18,786 ) ( 12,130 ) 27,625

Decrease in Government National Mortgage Association (“GNMA”) repurchase obligation ( 24,569 ) ( 18,786 ) ( 12,130 )

Recognition of operating right-of-use assets 20,568 13,428 5,776

12 unchanged sentences

Deeply rooted in Origin’s history is a culture committed to providing personalized relationship banking to businesses, municipalities, and personal clients to enrich the lives of the people in the communities it serves.

Origin provides a broad range of financial services and currently operates 59 banking centers located in Dallas/Fort Worth, East Texas, Houston, North Louisiana and Mississippi.

The Company provides a broad range of financial services and currently has over 60 locations from Dallas/Fort Worth, East Texas and Houston, across North Louisiana and into Mississippi .

In early 2024, we entered our new Southeast market with two planned banking locations in Mobile, Alabama and Fort Walton Beach, Florida.

The Company principally operates in one business segment, community banking.

1 unchanged sentence

The consolidated financial statements include the accounts of the Company and all other entities in which Origin Bancorp, Inc.

has a controlling financial interest, including the Bank, and Davison Insurance Agency, LLC ("Davison Insurance"), doing business as Lincoln Agency, LLC (the "Lincoln Agency"), Lincoln Agency Transportation Insurance, Pulley-White Insurance Agency ("Pulley-White"), Reeves, Coon & Funderburg, Simoneaux & Wallace Agency and Thomas & Farr Agency.

has a controlling financial interest, including the Bank, and Forth Insurance, LLC, formerly known as Davison Insurance Agency, LLC and doing business as Lincoln Agency, LLC, Lincoln Agency Transportation Insurance, Pulley-White Insurance Agency, Reeves, Coon & Funderburg, Simoneaux & Wallace Agency and Thomas & Farr Agency.

All significant intercompany balances and transactions have been eliminated in consolidation.

55 unchanged sentences

Interest accrued but not received for a security placed on nonaccrual status is reversed against interest income.

Gains and losses on sales are recorded on the trade date, are derived from the amortized cost of the security sold and are determined using the specific identification method.

Realized gains and losses are determined using the specific identification method and are recorded in noninterest income on the trade date.

Non-marketable Equity Securities Held in Other Financial Institutions .

2 unchanged sentences

The Company’s remaining equity investments in other financial institutions, excluding FRB and FHLB, totaling $ 25.9 million and $ 15.8 million at December 31, 2023 and 2022, respectively, qualify for the practicability exception under Accounting Standards Update ("ASU") 2016-01 due to having illiquid markets and are carried at cost, less impairment, plus or minus any observable price changes.

The carrying value of these securities was evaluated and was determined not to be impaired during the years ended December 31, 2022 and 2021 .

The carrying value of these securities was evaluated and determined not to be impaired during the years ended December 31, 2023 and 2022.

Loans Held for Sale .

Loans held for sale include mortgage loans and are carried at fair value, with unrealized gains and losses recorded in the consolidated statements of income.

Please see Mortgage Servicing Rights and Transfers of Financial Assets below for information on the GNMA repurchase asset which represents the difference between the total loans held for sale on the face of the consolidated balance sheet and the loans held for sale at fair value also shown on the face of the consolidated balance sheet.

Please see Mortgage Servicing Rights and Transfers of Financial Assets below for information on the GNMA repurchase asset, which represented the difference between the total loans held for sale and the loans held for sale at fair value, which are both shown on the Company’s consolidated balance sheets.

ORIGIN BANCORP, INC.

37 unchanged sentences

Interest income on nonaccrual loans may be recognized to the extent cash payments are received, but payments received are usually applied to principal.

Nonaccrual loans are generally returned to accrual status when contractual payments are less than 90 days past due, the customer has made required payments for at least six months, and the Company reasonably expects to collect all principal and interest.

Nonaccrual loans are generally returned to accrual status when payments are considered current, the customer has made required payments for at least six months, and the Company reasonably expects to collect all principal and interest.

If a loan is determined by management to be uncollectible, regardless of size, the portion of the loan determined to be uncollectible is then charged to the allowance for loan credit losses.

15 unchanged sentences

This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available.

Loans are charged off against the allowance for credit losses when management believes the loss is confirmed.

Loans are charged off against the allowance for credit losses when management believes the principal balance is unlikely to be collected.

Subsequent recoveries, if any, are credited to the allowance.

1 unchanged sentence

Internal risk ratings are considered the most meaningful indicator of credit quality for commercial and industrial, construction, and commercial real estate loans.

Internal risk ratings are a key factor in identifying loans that are individually evaluated for impairment and impact management's estimates of loss factors used in determining the amount of the allowance for credit losses.

Internal risk ratings are a key factor in identifying loans that are individually evaluated for credit loss and impact management’s estimates of loss factors used in determining the amount of the allowance for credit losses.

Internal risk ratings are updated on a regular basis.

Troubled debt restructurings ("TDRs") are loans for which the contractual terms on the loan have been modified and both of the following conditions exist:

(1) the borrower is experiencing financial difficulty and (2) the restructuring constitutes a concession.

Concessions could include a reduction in the interest rate on the loan, payment extensions, forgiveness of principal, forbearance or other actions intended to maximize collection.

The Company assesses all loan modifications to determine whether they constitute a TDR.

2022-02 eliminated the accounting guidance for troubled debt restructurings and enhanced disclosure requirements for certain loan modifications.

The Company may provide modifications to borrowers experiencing financial difficulty in the form of principal forgiveness, interest rate reductions, other-than-insignificant payment delays, or term extensions.

When principal forgiveness is provided, the amount of forgiveness is charged-off against the allowance for credit losses.

In some cases, the Company may provide multiple types of concessions on one loan.

The Company will evaluate whether the modification represents a new loan or a continuation of an existing loan.

The Company assesses all loan modifications to determine whether they were made to borrowers experiencing financial difficulty.

The allowance for off-balance sheet exposures was determined using the same methodology that is applied to LHFI.

Utilization rates are determined based on historical usage.

Credit losses related to available for sale debt securities are recorded through an allowance for credit losses.

The amount of the allowance for credit losses is limited to the amount by which fair value is below amortized cost.

Discounted cash flow analysis is required for determining credit losses for available for sale securities.

In determining whether or not a credit loss exists, such factors as extent of the loss, adverse conditions related to the entity, industry or geographic region, security structure, ratings and changes by a rating agency and past performance are considered.

The length of time a security has been in an unrealized loss position is not a factor in determining whether a credit loss exists.

The allowance for credit losses for held-to-maturity securities is calculated using a probability of default, loss given default methodology.

Credit losses are estimated over the lives of the securities using historical loss rates, adjusted for current conditions and reasonable and supportable forecasts.

Third-party data is used for the historical loss rates and probability of default statistics.

The forecast effect is applied over the estimated lives of the securities.

The Company evaluates the portfolio of AFS securities in an unrealized loss position, on a quarterly basis, to determine if it intends to sell, or it is more likely than not that it will be required to sell the securities before recovery of the amortized cost basis.

If either of the criteria regarding intent or requirement to sell is met, the securities’ amortized cost basis is written down to fair value through income.

For AFS securities that do not meet the criteria, the Company evaluates relevant factors to determine if the decline in fair value has resulted from credit losses or other factors.

In making this assessment, such factors as extent of the loss, adverse conditions related to the entity, industry or geographic region, security structure, ratings and changes by a rating agency and past performance are considered.

If the assessment indicates that a credit loss exists, the present value of cash flows expected to be collected are compared to the amortized cost basis of the security.

If the present value of cash flows expected to be collected is less than the amortized costs basis, a credit loss exists and an allowance for credit losses is recorded and reflected in income as provision for credit loss expense.

The Company measures the expected credit losses on HTM securities on a collective basis by major security type, with each type sharing similar risk characteristics and considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts.

These amounts are established as an allowance for credit losses and included in earnings as provision for credit loss expense.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Premises and Equipment, net .

1 unchanged sentence

Buildings and improvements are stated at cost less accumulated depreciation computed using the straight-line method over the estimated useful lives of the assets, which range from 15 to 39 years.

Leasehold improvements are capitalized and depreciated using the straight-line method over the terms of the respective leases or the estimated useful lives of the improvements, whichever is shorter.

Furniture, fixtures, and equipment are stated at cost less accumulated depreciation computed using the straight-line method over the estimated useful lives of the assets, which range from three to seven years .

4 unchanged sentences

The Company has no material finance leases.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Right of use ("ROU") assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease.

23 unchanged sentences

The Company sold approximately $ 1.8 million in GNMA mortgage servicing rights, representing $ 453.3 million in unpaid principal balances, with no significant additional gain or loss realized, and derecognized the related GNMA repurchase asset and offsetting liability of $ 24.6 million.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Derivative Instruments and Hedging Activities .

7 unchanged sentences

Note 12 — Derivative Financial Instruments describes the derivative instruments currently used by the Company and discloses how these derivatives impact its consolidated balance sheets and statements of income.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Goodwill and Other Intangible Assets .

8 unchanged sentences

Fair value is determined based on third-party appraisals.

Any subsequent capital improvements that increase value are added to the balance of the properties.

Any valuation adjustments required at the date of transfer from loans to OREO are charged to the allowance for credit losses.

Any subsequent write-downs to reflect current fair value, or gains and losses on the sale of the properties are charged to noninterest income.

At December 31, 2022 and 2021, the balance of OREO was $ 806,000 and $ 1.5 million, respectively, and included as a component of accrued interest receivable and other assets in the accompanying consolidated balance sheets.

At December 31, 2023 and 2022, the balance of OREO was $ 3.9 million and $ 806,000 , respectively, and included as a component of accrued interest receivable and other assets in the accompanying consolidated balance sheets.

Overnight Repurchase Agreements with Depositors .

9 unchanged sentences

Descriptions of the Company’s revenue generating activities that are within the scope of the revenue recognition standard are described below.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Service charges and fees on deposit accounts

9 unchanged sentences

The amounts are included as a component of other income in the consolidated statements of income.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Gain or loss on sale of other assets and OREO

In the normal course of business, the Company recognizes the sale on other assets and OREO, along with any gain or loss, when control of the property transfers to the buyer through an executed contractual agreement.

The transaction price is fixed, and on occasion the Company will finance a portion of the purchase price of the transferred asset.

The transaction price is fixed, and the Company may finance a portion of the purchase price of the transferred asset on an infrequent basis.

Mortgage Banking Revenue .

This revenue category primarily reflects the Company's mortgage production, sales and mortgage servicing revenue, including fees and income derived from mortgages originated with the intent to sell;

mortgage sales and servicing;

and the impact of risk management activities associated with the mortgage pipeline and mortgage servicing rights ("MSRs").

This revenue category primarily reflects the Company’s mortgage production, sales and mortgage servicing revenue, including fees and income derived from mortgages originated with the intent to sell, mortgage sales and servicing, and the impact of risk management activities associated with the mortgage pipeline and mortgage servicing rights ("MSRs").

This revenue category also includes gains and losses on sales and changes in fair value for mortgage loans originated with the intent to sell and measured at fair value under the fair value option.

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Federal income tax expense or benefit has been allocated to subsidiaries on a separate return basis.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Stock-Based Compensation .

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At December 31, 2023 and 2022, investments in limited partnerships, LLCs and other privately held companies totaled $ 22.2 million and $ 20.9 million, respectively, and were included in accrued interest receivable and other assets in the accompanying consolidated balance sheets.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Investments in Tax Credit Entities .

As part of its Community Reinvestment Act responsibilities and due to their favorable economic characteristics, the Company invests in tax credit-motivated projects primarily in the markets it serves.

These projects are directed at tax credits issued under Low-Income Housing Tax Credits.

These projects are directed at tax credits issued under Low-Income Housing Tax Credits (“LIHTC”).

The Company generates returns on tax credit motivated projects through the receipt of federal, and if applicable, state tax credits.

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Basic and diluted earnings per common share are calculated using the treasury method, under which basic earnings per share is calculated as net income divided by the weighted average number of common shares outstanding during the period.

Diluted earnings per share includes the dilutive effect of additional potential common shares issuable under stock options and restricted stock awards.

Diluted earnings per share includes the dilutive effect of additional potential common shares issuable under stock options and restricted stock awards and units.

Diluted income per common share considers common stock issuable under the assumed release of unvested restricted stock awards, restricted stock units, performance stock units, shares potentially issuable under the employee stock purchase plan, and the assumed exercise of stock options granted.

1 unchanged sentence

Potentially dilutive common stock equivalents are excluded from the computation of diluted earnings per common share in periods in which the effect would be anti-dilutive.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Effect of Recently Adopted Accounting Standards

2019-12, Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes.

ASU 2019-12 simplifies the accounting for income taxes by eliminating some exceptions to the general approach in ASC 740, Income Taxes.

It also clarifies certain aspects of the existing guidance to promote more consistent application, among other things.

The amendments in the update became effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years, and did not have a significant impact on the Company's consolidated financial statements or disclosures.

2021-06, Presentation of Financial Statements (Topic 205), Financial Services —Depository and Lending(Topic 942), and Financial Services — Investment Companies (Topic 946) —Amendments to SEC Paragraphs Pursuant to SEC Final Rule Releases No.

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update, expand and eliminate certain disclosures;

eliminate overlap with certain SEC and U.S.GAAP rules;

eliminate overlap with certain SEC and U.S.

and add a new subpart of Regulation S-K.

The ASU is effective upon issuance, however, the SEC release on which the ASU is based is effective for registrants with the first fiscal year ending after December 15, 2021, while Guide 3 will be rescinded effective January 1, 2023.

Implementation of this ASU did not materially impact the Company’s financial statement disclosures.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Effect of Newly Issued But Not Yet Effective Accounting Standards

2021-08, Business Combinations (Topic 805) — Accounting for Contract Assets and Contract Liabilities from Contracts with Customers.

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The ASU is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years.

Implementation of this ASU is not expected to materially impact the Company's financial statements or disclosures.

Implementation of this ASU did not materially impact the Company’s financial statements or disclosures.

2022-01, Derivatives and Hedging (Topic 815) — Fair Value Hedging - Portfolio Layer Method .

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The ASU is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years.

Implementation of this ASU is not expected to materially impact the Company's financial statements or disclosures.

Implementation of this ASU did not materially impact the Company’s financial statements or disclosures.

2022-02, Financial Instruments - Credit Losses (Topic 326) — Troubled Debt Restructurings and Vintage Disclosures.

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The ASU is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years.

Implementation of this ASU is not expected to materially impact the Company's financial statements or disclosures.

Implementation of this ASU did not materially impact the Company’s financial statements or disclosures.

Effect of Newly Issued But Not Yet Effective Accounting Standards

2022-06, Reference Rate Reform (Topic 848) - Deferral of the Sunset Date of Topic 848 — The amendments in this Update provide temporary relief during the transition period in complying with Update No.

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Notes to Consolidated Financial Statements

2023-02, Investments - Equity Method and Joint Ventures (Topic 323):

Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method — The amendments in this Update allow entities to elect to account for equity investments made primarily for the purpose of receiving income tax credits using the proportional amortization method, regardless of the tax credit program through which the investment earns income tax credits, if certain conditions are met.

The amendments in this Update also eliminate certain LIHTC-specific guidance to align the accounting more closely for LIHTCs with the accounting for other equity investments in tax credit structures and require that the delayed equity contribution guidance apply only to tax equity investments accounted for using the proportional amortization method.

The ASU is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years.

Implementation of this ASU is not expected to materially impact the Company's financial statements or disclosures.

2023-06, Disclosure Improvements:

Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative — The amendments in this Update modify the disclosure or presentation requirements of a variety of Topics in the Codification.

Certain of the amendments represent clarifications to or technical corrections of the current requirements.

Because of the variety of Topics amended, a broad range of entities may be affected by one or more of those amendments.

The effective date of this ASU will be coincident with the removal of the related disclosure from Regulation S-X or Regulation S-K.

Implementation of this ASU is not expected to materially impact the Company's financial statements or disclosures.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures — The amendments in this Update improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

The amendments in this Update:

Require that a public entity disclose, on an annual and interim basis, significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss (collectively referred to as the “significant expense principle”).

Require that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment and a description of its composition.

The other segment items category is the difference between segment revenue less the segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss.

Require that a public entity provide all annual disclosures about a reportable segment’s profit or loss and assets currently required by Topic 280 in interim periods.

Clarify that if the CODM uses more than one measure of a segment’s profit or loss in assessing segment performance and deciding how to allocate resources, a public entity may report one or more of those additional measures of segment profit.

However, at least one of the reported segment profit or loss measures (or the single reported measure, if only one is disclosed) should be the measure that is most consistent with the measurement principles used in measuring the corresponding amounts in the public entity’s consolidated financial statements.

In other words, in addition to the measure that is most consistent with the measurement principles under generally accepted accounting principles (GAAP), a public entity is not precluded from reporting additional measures of a segment’s profit or loss that are used by the CODM in assessing segment performance and deciding how to allocate resources.

Require that a public entity disclose the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources.

Require that a public entity that has a single reportable segment provide all the disclosures required by the amendments in this Update and all existing segment disclosures in Topic 280.

The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

Retrospective application to all periods presented in the financial statements is required.

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

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures — The amendments in this Update, on an annual basis, require that public business entities (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold.

Specifically, public business entities are required to disclose a tabular reconciliation, using both percentages and reporting currency amounts, for specific listed categories.

The ASU is effective for fiscal years beginning after December 15, 2024, including interim periods within those fiscal years.

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

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Note 2 — Earnings Per Share

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Diluted earnings per common share 2.71 3.28 4.60

Note 3 - Business Combinations

BT Holdings, Inc.

On August 1, 2022, the Company completed its merger with BT Holdings, Inc.

(“BTH”), a Texas corporation and the registered bank holding company of BTH Bank, acquiring 100 % of the voting equity interests of BTH.

The Company issued 6,794,910 shares of its common stock, and all outstanding BTH common stock options were converted into options to purchase an aggregate of 611,676 shares of Origin common stock.

Based on the closing price of the Company's common stock on July 29, 2022, of $ 43.07 per share, the aggregate consideration to be paid to holders of BTH common stock in connection with the merger is valued at approximately $ 307.8 million.

Goodwill of $ 94.5 million was recorded as a result of the transaction.

The merger added new markets for expansion and brings complementary businesses together to drive synergies and growth, which are the factors that gave rise to the goodwill recorded.

The goodwill will not be deductible for tax purposes.

Including the effects of the known purchase accounting adjustments, as of the merger date, Origin had approximately $ 9.84 billion in assets, $ 6.77 billion in loans and $ 7.99 billion in deposits on a consolidated basis.

Origin Bank and BTH Bank, N.A.

operated as separate banking subsidiaries of the Company until the merger of the banks, which Origin completed on October 7, 2022, concurrently with the data processing conversion.

BTH formerly operated its banking business from 13 locations in East Texas, Dallas and Fort Worth, Texas, each of which now operates as a banking location of Origin Bank.

The purchase price allocation and certain fair value measurements remain preliminary due to the timing of the merger.

The Company will continue to review the estimated fair values of loans, deposits and intangible assets, and to evaluate the assumed tax positions and contingencies.

The Company has determined that the merger of the net assets of BTH constitutes a business combination as defined by the ASC Topic 805.

Accordingly, the assets acquired and liabilities assumed are presented at their fair values as required.

Fair values were determined based on the requirements of ASC Topic 820.

In many cases, the determination of these fair values required management to make estimates about discount rates, future expected cash flows, market conditions and other future events that are highly subjective in nature and subject to change.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

The following schedule is a preliminary breakdown of the assets acquired and liabilities assumed as of the merger date:

BT Holdings, Inc.

(Dollars in thousands) As Recorded by Origin

Assets Acquired:

Cash and cash equivalents $ 69,953

Investment securities 456,808

Loans acquired 1,239,532

Allowance for credit losses on loans ( 5,527 )

Loans receivable, net 1,234,005

Premises and equipment 17,825

Non-marketable equity securities held in other financial institutions 5,873

Core deposit intangible 38,356

Other assets 23,778

Total assets acquired $ 1,846,598

Liabilities Assumed:

Noninterest-bearing deposits $ 398,089

Interest-bearing deposits 865,864

Time deposits 302,506

Total deposits 1,566,459

Securities sold under agreements to repurchase 10,133

Subordinated indebtedness, net 44,074

Accrued expenses and other liabilities 12,674

Total liabilities assumed 1,633,340

Net assets acquired 213,258

Purchase price 307,784

Goodwill $ 94,526

The Company’s operating results include the operating results of the acquired assets and assumed liabilities of BTH subsequent to the merger date.

Acquisition Accounting.

The following is a description of the methods used to determine the fair values of significant assets and liabilities acquired as part of a merger or acquisition.

The Company elected to use the pushdown accounting method to record the merger.

Loans acquired – Fair values for PCD loans were based on a discounted cash flow methodology that considered factors including the type of loan and related collateral, classification status, fixed or variable interest rate, term of loan and whether or not the loan was amortizing, and current discount rates except when a fair value of collateral approach was applied.

The discount rates used for PCD loans were based on current market rates and include adjustments for liquidity concerns.

The discount rate does not include a factor for credit losses, as that has been included in the estimated cash flows.

Non-PCD loans were grouped together according to similar characteristics and were treated in the aggregate when applying valuation techniques.

See Note 5 - Loans in these notes to the consolidated financial statements for more information related to loans acquired.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Loan Acquisition Accounting – The Company accounts for its acquisitions/mergers under ASC Topic 805, Business Combinations, which requires the use of the acquisition method of accounting.

All identifiable assets acquired, including loans, are recorded at fair value.

The fair value for acquired loans at the time of acquisition or merger is based on a variety of factors, including discounted expected cash flows, adjusted for estimated prepayments and credit losses.

In accordance with ASC 326, the fair value adjustment is recorded as premium or discount to the unpaid principal balance of each acquired loan.

Loans that have been identified as having experienced a more-than-insignificant deterioration in credit quality since origination are PCD loans.

The net premium or discount on PCD loans is adjusted by the Company’s allowance for credit losses recorded at the time of merger/acquisition.

The remaining net premium or discount is accreted or amortized into interest income over the remaining life of the loan using the effective interest rate method.

The net premium or discount on loans that are not classified as PCD (“non-PCD”), that includes credit and non-credit components, is accreted or amortized into interest income over the remaining life of the loan using a constant yield method.

The Company then records the necessary allowance for credit losses on the non-PCD loans through provision for credit losses expense.

During the quarter ended December 31, 2022, the Company continued to analyze the valuations and accounting associated with the acquired assets and assumed liabilities and received updated information resulting in the revised amounts displayed below.

The Company updated the estimated amounts of these items within the consolidated balance sheets with a corresponding adjustment to goodwill.

The changes are gross of taxes and reflected in the following table:

(Dollars in thousands)

Acquired Asset or Liability

Consolidated Balance Sheet Line Item Provisional Estimate Revised Estimate Increase (Decrease)

Loan acquired Loans, net of allowance for credit losses $ 1,239,625 $ 1,239,532 $ ( 93 )

Deferred tax asset Other Assets 17,427 23,778 6,351

Provision for off-balance sheet contingencies Accrued expenses and other liabilities 14,530 12,674 ( 1,856 )

Goodwill Goodwill 102,640 94,526 ( 8,114 )

Purchased loans that reflect a more-than-insignificant deterioration of credit from origination are considered PCD.

For PCD loans, the initial estimate of expected credit losses is recognized in the allowance for credit loss on the date of the merger using the same methodology as other loans held for investment as discussed in Note 5 - Loans in these notes to the consolidated financial statements.

The following table provides a summary of loans purchased with credit deterioration at the merger transaction date with BTH:

August 1, 2022

(Dollars in thousands) Commercial Real Estate Construction/ Land/ Land Development Residential Real Estate Commercial and Industrial Mortgage Warehouse Lines of Credit Consumer Total

Unpaid principal balance $ 10,731 $ 1,315 $ 2,880 $ 37,117 $ — $ 169 $ 52,212

PCD allowance for credit loss at merger 1 — — 5,525 — 1 5,527

Non-credit related (premium)/discount ( 277 ) ( 92 ) 3 ( 77 ) — 1 ( 442 )

Fair value of PCD loans $ 11,007 $ 1,407 $ 2,877 $ 31,669 $ — $ 167 $ 47,127

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Revenue and earnings of BTH since the acquisition date have not been disclosed as the acquired company was merged into the Company and separate financial information is not readily available.

The following table presents unaudited pro-forma information as if the merger with BTH had occurred on January 1, 2021.

This pro-forma information gives effect to certain adjustments, including purchase accounting fair value adjustments, amortization of core deposit intangible and related income tax effects and is based on our historical results for the periods presented.

Transaction-related costs related to the merger are not reflected in the pro-forma amounts.

The pro-forma information does not necessarily reflect the results of operations that would have occurred had the Company acquired BTH at the beginning of fiscal year 2021.

Cost savings are also not reflected in the unaudited pro-forma amounts.

(Dollars in thousands except share and per share data) Actual for the

Year Ended December 31, 2022 Pro-Forma for the Year Ended December 31,

Net interest income $ 275,278 $ 323,772 $ 276,817

Noninterest income 57,274 65,900 66,157

Net income 87,715 104,969 122,710

Pro-forma earnings per share:

Basic — 3.14 4.06

Diluted — 3.11 4.02

Weighted average shares outstanding:

26,627,476 33,455,866 30,259,894

Basic $ 3.29 $ — $ —

Diluted 3.28 — —

Lincoln Agency and Pulley-White Acquisition

On December 31, 2021, the Company acquired the remaining 62 % equity interest in the Lincoln Agency for $ 5.3 million in cash and $ 5.3 million in Company common stock.

The Company previously acquired a 38 % minority interest in Lincoln Agency that was accounted for as an equity method investment, which had an immaterial carrying value at the acquisition date.

The acquisition of the remaining equity interest was considered a step acquisition, whereby the Company re-measured the previously held equity method investment to its fair value of $ 5.2 million, resulting in the recognition of a gain of $ 5.2 million, which is recorded as a component of noninterest income in the accompanying consolidated statements of income.

The acquisition date fair value of the previously held equity method investment was calculated using multiple factors, including the total consideration for the acquired ownership interest of Lincoln Agency and an analysis of control premiums paid for similar transactions.

The purchase agreement for Lincoln Agency includes potential earnout payments of up to $ 250,000 based on net product line revenue for fiscal year 2023 and up to an additional $ 750,000 based on compound annual revenue growth for fiscal year 2024.

The Company included the $ 795,000 fair value of this contingent liability as a component of other liabilities on the accompanying consolidated balance sheets at December 31, 2021.

At December 31, 2022, the contingent liability was valued at $ 825,000 in accordance with ASC Topic 805.

Additionally, the Company acquired certain assets, including 100 % of the book of business, and assumed certain liabilities of Pulley-White on December 31, 2021, for $ 2.2 million in cash and $ 2.2 million in Company common stock.

The purchase agreement for Pulley-White includes potential earnout payments of up to an additional $ 250,000 provided the revenue attributable to the legacy operations of Pulley-White for the two years ended December 31, 2023, achieves certain compounded annual growth rate metrics and payments of up to $ 500,000 provided the revenue attributable to the legacy operations of Pulley-White for the three years ended December 31, 2024, achieves certain compounded annual growth rate metrics.

The Company included the $ 574,000 fair value of this contingent liability as a component of other liabilities on the accompanying consolidated balance sheets at December 31, 2021.

At December 31, 2022, the contingent liability was valued at $ 631,000 in accordance with ASC Topic 805.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

A summary of the fair value of assets acquired and liabilities assumed from the insurance acquisitions was as follows:

(Dollars in thousands) Estimated Fair Value

Assets Acquired:

Definite-lived intangibles $ 14,067

Operating lease right of use assets 1,488

Prepaid expense and other assets 18

Total assets acquired 15,573

Liabilities Assumed:

Operating lease liability 1,488

Net assets acquired 14,085

Total consideration 21,497

Goodwill $ 7,412

The fair value of assets acquired and liabilities assumed were preliminary and based on valuation estimates and assumptions at December 31, 2021.

The Company continued to analyze the valuations and accounting associated with the acquired assets and assumed liabilities and received updated information during the first quarter of 2022, resulting in a $ 215,000 downward adjustment to the goodwill associated with the acquisitions of Lincoln Agency and Pulley-White.

With these acquisitions, the Company continues to expand the scope of product offerings to its banking customers.

$ 4.6 million of goodwill associated with these acquisitions is deductible for income tax purposes.

A summary of total consideration was as follows:

(Dollars in thousands) December 31, 2021

Cash paid $ 7,457

Common stock issued ( 177,348 shares)

Contingent consideration 1,369

Fair value of previously held interest in Lincoln Agency 5,213

Total consideration $ 21,497

The Company has determined the insurance acquisitions constitute a business combination as defined by ASC Topic 805, which establishes principles and requirements for how the acquirer of a business recognizes and measures in its financial statements the identifiable assets acquired and the liabilities assumed.

The Company has recorded the assets purchased and liabilities assumed at their estimated fair value in accordance with ASC Topic 805.

The fair value of assets acquired and liabilities assumed in the insurance acquisitions are final.

Pro forma results of aggregate operations for the insurance acquisitions are not presented because these acquisitions are not material to the Company's consolidated results of operations.

There were 442,909 , 9,881 and 2,085 shares of anti-dilutive stock-based awards excluded from calculation of earnings per share for the years ended December 31, 2023, 2022, and 2021, respectively, primarily due to the stock price of the stock awards exceeding the average market price of the Company’s stock during the respective periods.

ORIGIN BANCORP, INC.

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See Note 5 — Fair Value of Financial Instruments for more information.

On August 1, 2022, the Company completed the merger with BT Holdings, Inc.

and acquired $ 456.8 million of available for sale securities from BTH, $ 447.5 million of which were sold during the third quarter of 2022, and classified the remaining as available-for-sale at the merger date.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Securities with unrealized losses at December 31, 2022, and 2021, aggregated by investment category and those individual securities that have been in a continuous unrealized loss position for less than 12 months, and for 12 months or more, were as follows.

Securities with unrealized losses at December 31, 2023, and December 31, 2022, aggregated by investment category and those individual securities that have been in a continuous unrealized loss position for less than 12 months, and for 12 months or more, were as follows.

Less than 12 Months 12 Months or More Total

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Commercial collateralized mortgage obligations 21,999 ( 2,516 ) 16,814 ( 3,001 ) 38,813 ( 5,517 )

14,568 ( 330 ) — — 14,568 ( 330 )

Residential collateralized mortgage obligations 48,749 ( 3,928 ) 97,621 ( 19,838 ) 146,370 ( 23,766 )

127,080 ( 2,623 ) 31,301 ( 788 ) 158,381 ( 3,411 )

Asset-backed securities 62,047 ( 1,528 ) 9,853 ( 490 ) 71,900 ( 2,018 )

Total $ 794,894 $ ( 59,754 ) $ 801,830 $ ( 144,737 ) $ 1,596,724 $ ( 204,491 )

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Management evaluates available for sale debt securities in unrealized loss positions to determine whether the impairment is due to credit-related factors or noncredit-related factors.

Consideration is given to (1) the extent to which the fair value is less than the cost, (2) the financial condition and near-term prospects of the issuer, and (3) the intent and ability of the Company to retain its investment in the security for a period of time sufficient to allow for any anticipated recovery in fair value.

Management does not have the intent to sell any of the securities in an unrealized loss position and believes that it is more likely than not that the Company will not have to sell any such securities before a recovery of cost.

Consideration is given to (1) the extent to which the fair value is less than the cost, and (2) the financial condition and near-term prospects of the issuer and (3) the intent and ability of the Company to retain its investment in the security for a period of time sufficient to allow for any anticipated recovery in fair value.

Management does not currently intend to sell any securities in an unrealized loss position and believes that it is more likely than not that the Company will not have to sell any such securities before a recovery of cost.

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

Accordingly, at December 31, 2022, management believes that the unrealized losses detailed in the previous table are due to noncredit-related factors, including changes in interest rates and other market conditions, and therefore no losses have been recognized in the Company’s consolidated statements of income.

Accordingly, at December 31, 2023, management believes that the unrealized losses detailed in the previous table are due to noncredit-related factors, including changes in interest rates and other market conditions.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

The following table presents the activity in the allowance for credit losses for held-to-maturity debt securities.

The following table presents the activity in the allowance for credit losses for held-to-maturity securities.

(Dollars in thousands) Municipal Securities

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Balance at January 1, $ 899 $ 167 $ 66

Impact of adopting ASC 326 — — 96

Provision expense for credit loss for held to maturity securities 732 101 ( 30 )

Provision (recovery) expense for credit loss for held to maturity securities ( 836 ) 732 101

Balance at December 31, $ 63 $ 899 $ 167

$ 899 $ 167 $ 66

Accrued interest of $ 8.2 million and $ 6.1 million was not included in the calculation of the allowance or the amortized cost basis of the debt securities at December 31, 2022 or 2021, respectively.

There were no past due held-to-maturity securities or held-to-maturity securities in nonaccrual status at December 31, 2022 or 2021.

Accrued interest of $ 5.3 million and $ 8.2 million was not included in the calculation of the allowance or the amortized cost basis of the securities at December 31, 2023 or 2022, respectively.

There were no past due or nonaccrual available for sale or held to maturity securities at December 31, 2023 or 2022.

Proceeds from sales and calls, and related gross gains and losses of securities available for sale, are shown below.

Year Ended December 31,

Years Ended December 31,

(Dollars in thousands) 2023 2022 2021

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Commercial real estate (1)

$ 2,442,734 $ 2,304,678

Construction/land/land development 1,070,225 945,625

6 unchanged sentences

7,660,944 7,090,022

Allowance for loan credit losses 87,161 64,586

Allowance for loan credit losses (“ALCL”)

96,868 87,161

LHFI, net $ 7,564,076 $ 7,002,861

____________________________

(1) Includes purchase accounting adjustment and net deferred loan fees of $ 14.2 million at December 31, 2022, and net deferred loan fees of $ 9.6 million at December 31, 2021.

There were no merger date loan fair value adjustments at December 31, 2021.

On August 1, 2022, the Company completed the merger with BTH.

As of the merger date, BTH had approximately $ 1.24 billion in loans and the Company recorded a Day 1 fair value purchase accounting net discount of $ 5.1 million.

As of December 31, 2022, the remaining purchase accounting net loan discount was $ 2.2 million.

(1) Includes owner occupied commercial real estate of $ 953.8 million and $ 843.0 million at December 31, 2023, and December 31, 2022, respectively.

(2) Includes unamortized purchase accounting adjustment and net deferred loan fees of $ 11.8 million and $ 14.2 million at December 31, 2023, and December 31, 2022, respectively.

As of December 31, 2023, and December 31, 2022, the remaining purchase accounting net loan discount was $ 222,000 and $ 2.2 million, respectively.

Credit quality indicators.

As part of the Company's commitment to managing the credit quality of its loan portfolio, management annually and periodically updates and evaluates certain credit quality indicators, which include but are not limited to (i) weighted-average risk rating of the loan portfolio, (ii) net charge-offs, (iii) level of non-performing loans, (iv) level of classified loans (defined as substandard, doubtful and loss), and (v) the general economic conditions in the cities and states in which the Company operates.

As part of the Company’s commitment to managing the credit quality of its loan portfolio, management annually and periodically updates and evaluates certain credit quality indicators, which include but are not limited to (i) weighted-average risk rating of the loan portfolio, (ii) net charge-offs, (iii) level of non-performing loans, (iv) level of classified loans (defined as substandard, doubtful and loss), and (v) the general economic conditions particularly in the cities and states in which the Company operates.

The Company maintains an internal risk rating system where ratings are assigned to individual loans based on assessed risk.

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In connection with the review of the loan portfolio, the Company considers risk elements attributable to particular loan types or categories in assessing the quality of individual loans.

The list of loans to be reviewed for possible individual evaluation consists of nonaccrual commercial loans over $100,000 with direct exposure, unsecured loans over 90 days past due, commercial loans classified substandard or worse over $100,000 with direct exposure, TDRs, consumer loans greater than $100,000 with a FICO score under 625, loans greater than $100,000 in which the borrower has filed bankruptcy, and all loans 180 days or more past due.

The list of loans to be reviewed for possible individual evaluation consists of unsecured loans over 90 days past due, modified loans to borrowers experiencing financial difficulty, loans greater than $100,000 in which the borrower has filed bankruptcy, collateralized loans 180 days or more past due, classified commercial loans, including non-accrual, over $100,000 with direct exposure, and consumer loans greater than $100,000 with a FICO score under 625.

Loans under $50,000 will be evaluated collectively in designated pools unless a loss exposure has been identified.

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An allowance for credit losses is determined using the same methodology as other individually evaluated loans.

The Company held approximately $ 48.1 million of unpaid principal balance PCD loans at December 31, 2022, as a result of the merger with BTH on August 1, 2022, and none at December 31, 2021.

Please see Note 1 - Significant Accounting Policies in these Notes to Consolidated Financial Statements for a description of our accounting policies related to purchased financial assets with credit deterioration.

As a result of the merger with BT Holdings, Inc., (“BTH”), the Company held approximately $ 34.8 million and $ 48.1 million of unpaid principal balance PCD loans at December 31, 2023, and December 31, 2022, respectively.

Please see Note 1 — Significant Accounting Policies included in these Notes to Consolidated Financial Statements for a description of our accounting policies related to purchased financial assets with credit deterioration.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

The following table reflects recorded investments in loans by credit quality indicator and origination year at December 31, 2022, excluding loans held for sale and loans accounted for at fair value.

The following table reflects recorded investments in loans by credit quality indicator and origination year at December 31, 2023, and gross charge-offs for the year ended December 31, 2023, excluding loans held for sale.

Loans acquired are shown in the table by origination year, not merger date.

7 unchanged sentences

Total commercial real estate loans $ 334,613 $ 889,519 $ 473,772 $ 255,465 $ 204,945 $ 206,427 $ 77,993 $ 2,442,734

Current period gross charge-offs $ — $ — $ — $ — $ — $ 166 $ — $ 166

Current period gross recoveries — 31 — — 6 3 — 40

Current period net charge-offs (recoveries) $ — $ ( 31 ) $ — $ — $ ( 6 ) $ 163 $ — $ 126

Year-to-date gross charge-offs $ — $ — $ — $ — $ — $ 42 $ — $ 42

Construction/land/land development:

3 unchanged sentences

Total construction/land/land development loans $ 260,439 $ 474,967 $ 234,378 $ 21,549 $ 7,883 $ 26,020 $ 44,989 $ 1,070,225

Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period gross recoveries — — — — 200 11 — 211

Current period net charge-offs (recoveries) $ — $ — $ — $ — $ ( 200 ) $ ( 11 ) $ — $ ( 211 )

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

Residential real estate:

3 unchanged sentences

Total residential real estate loans $ 333,813 $ 551,489 $ 290,728 $ 238,361 $ 80,866 $ 147,214 $ 92,464 $ 1,734,935

Current period gross charge-offs $ — $ — $ — $ — $ — $ 91 $ — $ 91

Current period gross recoveries — — — 75 — 27 — 102

Current period net charge-offs (recoveries) $ — $ — $ — $ ( 75 ) $ — $ 64 $ — $ ( 11 )

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Amortized Cost Basis by Origination Year

(Dollars in thousands) 2022 2021 2020 2019 2018 Prior Revolving Loans Amortized Cost Basis Total

Year-to-date gross charge-offs $ — $ — $ — $ 5 $ — $ 22 $ — $ 27

Commercial and industrial:

3 unchanged sentences

Total commercial and industrial loans $ 403,566 $ 280,211 $ 173,544 $ 37,366 $ 58,032 $ 48,745 $ 1,057,996 $ 2,059,460

Current period gross charge-offs $ 28 $ 726 $ 48 $ 869 $ 337 $ 1,103 $ 5,348 $ 8,459

Current period gross recoveries 42 213 4 141 21 2,436 968 3,825

Current period net charge-offs (recoveries) $ ( 14 ) $ 513 $ 44 $ 728 $ 316 $ ( 1,333 ) $ 4,380 $ 4,634

Year-to-date gross charge-offs $ 203 $ 328 $ 233 $ 141 $ 539 $ 679 $ 9,710 $ 11,833

Mortgage Warehouse Lines of Credit:

Pass $ — $ — $ — $ — $ — $ — $ 329,966 $ 329,966

Special mention — — — — — — 2,042 2,042

Classified — — — — — — 527 527

Total mortgage warehouse lines of credit $ — $ — $ — $ — $ — $ — $ 284,867 $ 284,867

Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period gross recoveries — — — — — — — —

Current period net charge-offs (recoveries) $ — $ — $ — $ — $ — $ — $ — $ —

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

Pass $ 11,053 $ 3,567 $ 1,040 $ 399 $ 470 $ 17 $ 6,988 $ 23,534

1 unchanged sentence

Total consumer loans $ 11,088 $ 3,609 $ 1,050 $ 399 $ 472 $ 17 $ 6,989 $ 23,624

Current period gross charge-offs $ 3 $ 27 $ 7 $ 2 $ 1 $ 1 $ 2 $ 43

Current period gross recoveries — — 7 — 3 5 1 16

Current period net charge-offs (recoveries) $ 3 $ 27 $ — $ 2 $ ( 2 ) $ ( 4 ) $ 1 $ 27

The following table reflects recorded investments in loans by credit quality indicator and origination year at December 31, 2021, excluding loans held for sale and loans accounted for at fair value.

Year-to-date gross charge-offs $ 3 $ 102 $ 7 $ — $ — $ 2 $ 33 $ 147

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

The following table reflects recorded investments in loans by credit quality indicator and origination year at December 31, 2022, and gross charge-offs for the year ended December 31, 2022, excluding loans held for sale.

Loans acquired are shown in the table by origination year, not merger date.

The Company had an immaterial amount of revolving loans converted to term loans at December 31, 2022.

6 unchanged sentences

Total commercial real estate loans $ 886,174 $ 504,082 $ 284,919 $ 234,054 $ 179,218 $ 144,671 $ 71,560 $ 2,304,678

Current period gross charge-offs $ — $ — $ — $ 120 $ 24 $ 26 $ — $ 170

Current period gross recoveries — — — 48 3 14 — 65

Current period net charge-offs (recoveries) $ — $ — $ — $ 72 $ 21 $ 12 $ — $ 105

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Amortized Cost Basis by Origination Year

(Dollars in thousands) 2021 2020 2019 2018 2017 Prior Revolving Loans Amortized Cost Basis Total

Year-to-date gross charge-offs $ — $ — $ — $ — $ — $ 166 $ — $ 166

Construction/land/land development:

3 unchanged sentences

Total construction/land/land development loans $ 452,340 $ 321,051 $ 59,166 $ 27,419 $ 27,913 $ 6,961 $ 50,775 $ 945,625

Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period gross recoveries — — — — — — — —

Current period net charge-offs (recoveries) $ — $ — $ — $ — $ — $ — $ — $ —

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

Residential real estate:

3 unchanged sentences

Total residential real estate loans $ 537,966 $ 310,834 $ 261,773 $ 109,024 $ 49,716 $ 127,705 $ 80,520 $ 1,477,538

Current period gross charge-offs $ — $ 7 $ 61 $ — $ — $ 10 $ — $ 78

Current period gross recoveries — 21 19 — 25 52 — 117

Current period net charge-offs (recoveries) $ — $ ( 14 ) $ 42 $ — $ ( 25 ) $ ( 42 ) $ — $ ( 39 )

Year-to-date gross charge-offs $ — $ — $ — $ — $ — $ 91 $ — $ 91

Commercial and industrial:

3 unchanged sentences

Total commercial and industrial loans $ 467,137 $ 253,429 $ 82,356 $ 77,021 $ 41,945 $ 29,748 $ 1,099,525 $ 2,051,161

Current period gross charge-offs $ 9 $ 1,172 $ 54 $ 5 $ 1,467 $ 6,354 $ 2,862 $ 11,923

Current period gross recoveries — 18 51 3 102 204 339 717

Current period net charge-offs (recoveries) $ 9 $ 1,154 $ 3 $ 2 $ 1,365 $ 6,150 $ 2,523 $ 11,206

Year-to-date gross charge-offs $ 28 $ 726 $ 48 $ 869 $ 337 $ 1,103 $ 5,348 $ 8,459

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Amortized Cost Basis by Origination Year

(Dollars in thousands) 2022 2021 2020 2019 2018 Prior Revolving Loans Amortized Cost Basis Total

Mortgage Warehouse Lines of Credit:

Pass $ — $ — $ — $ — $ — $ — $ 282,298 $ 282,298

Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Current period gross recoveries — — — — — — — —

Current period net charge-offs (recoveries) $ — $ — $ — $ — $ — $ — $ — $ —

Special mention — — — — — — 2,042 2,042

Classified — — — — — — 527 527

Year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ 284,867 $ 284,867

Current period year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ —

Pass $ 9,730 $ 3,822 $ 1,210 $ 784 $ 135 $ 15 $ 10,408 $ 26,104

1 unchanged sentence

Total consumer loans $ 9,752 $ 3,841 $ 1,210 $ 790 $ 135 $ 15 $ 10,410 $ 26,153

Current period gross charge-offs $ — $ 5 $ 29 $ 2 $ — $ 9 $ 18 $ 63

Current period gross recoveries — — 20 7 1 17 4 49

Current period net charge-offs (recoveries) $ — $ 5 $ 9 $ ( 5 ) $ ( 1 ) $ ( 8 ) $ 14 $ 14

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Year-to-date gross charge-offs $ 3 $ 27 $ 7 $ 2 $ 1 $ 1 $ 2 $ 43

The following tables present the Company’s loan portfolio aging analysis at the dates indicated:

23 unchanged sentences

Mortgage warehouse lines of credit — — — — 284,867 284,867 —

— — — — 627,078 627,078 —

Consumer 350 16 11 377 25,776 26,153 —

2 unchanged sentences

Notes to Consolidated Financial Statements

GAAP requires that a discount or premium, and also an allowance for credit losses be recorded on acquired loans.

The Company completed the merger with BTH on August 1, 2022.

As a result, the Company recorded $ 5.1 million in net loan discounts and a $ 5.5 million increase in the allowance for credit losses related to PCD loans.

In addition, the Company recorded a Day 1 $ 14.9 million provision for loan credit losses on non-PCD loans required by the Current Expected Credit Losses ("CECL") guidance.

The following tables detail activity in the allowance for loan credit losses by portfolio segment.

The following tables detail activity in the ALCL by portfolio segment.

Accrued interest of $ 35.1 million and $ 27.1 million was not included in the book value for the purposes of calculating the allowance at December 31, 2023 and 2022, respectively.

4 unchanged sentences

Beginning balance $ 19,772 $ 7,776 $ 8,230 $ 50,148 $ 379 $ 856 $ 87,161

Allowance for loan credit losses - BTH merger 1 — — 5,525 — 1 5,527

Charge-offs 42 — 27 11,833 — 147 12,049

4 unchanged sentences

Average balance $ 2,404,530 $ 1,015,178 $ 1,629,589 $ 2,054,081 $ 314,079 $ 24,627 $ 7,442,084

Net Charge-offs to Loan Average Balance 0.01 % ( 0.03 ) % — % 0.28 % — % 0.13 % 0.08 %

Net charge-offs to loan average balance (annualized) — % — % — % 0.38 % — % 0.54 % 0.10 %

_________________________

(1) The $ 24.7 million provision for credit losses on the consolidated statement of income includes a $ 21.6 million provision for loan losses, a $ 2.3 million provision for off-balance sheet commitments and a $ 732,000 provision for held to maturity securities credit losses for the year ended December 31, 2022.

(2) Excluded from the allowance is $ 10.8 million in PCD loans that were acquired in the merger with BTH that were added to the allowance and immediately written off.

(1) The $ 16.8 million provision for credit losses on the consolidated statement of income includes a $ 17.5 million provision for loan losses, a $ 75,000 provision for off-balance sheet commitments and an $ 836,000 net benefit provision for credit losses on held to maturity securities for the year ended December 31, 2023.

Year Ended December 31, 2022

2 unchanged sentences

Beginning balance $ 13,425 $ 4,011 $ 6,116 $ 40,146 $ 340 $ 548 $ 64,586

Allowance for loan credit losses - BTH merger (1)

1 — — 5,525 — 1 5,527

Charge-offs 166 — 91 8,459 — 43 8,759

4 unchanged sentences

Average balance $ 1,951,246 $ 708,758 $ 1,143,190 $ 1,675,719 $ 420,639 $ 20,913 $ 5,920,465

Net Charge-offs to Loan Average Balance 0.01 % — % — % 0.69 % — % 0.08 % 0.21 %

Net charge-offs to loan average balance (annualized) 0.01 % ( 0.03 ) % — % 0.28 % — % 0.13 % 0.08 %

_________________________

(1) The $ 10.8 million provision for credit losses net benefit on the consolidated statement of income includes a $ 10.8 million provision for loan losses net benefit, a $ 68,000 benefit for off-balance sheet commitments and a $ 101,000 provision for held to maturity securities credit losses for the year ended December 31, 2021.

(1) Excluded from the allowance is $ 10.8 million in PCD loans that were acquired in the merger with BTH that were added to the allowance and immediately written off.

(2) The $ 24.7 million provision for credit losses on the consolidated statements of income includes a $ 21.6 million provision for loan losses, a $ 2.3 million provision for off-balance sheet commitments and a $ 732,000 provision for held to maturity securities credit losses for the year ended December 31, 2022.

ORIGIN BANCORP, INC.

4 unchanged sentences

Beginning Balance $ 15,430 $ 8,191 $ 9,418 $ 51,857 $ 856 $ 918 $ 86,670

Impact of Adopting ASC 326 ( 5,052 ) 1,141 ( 2,526 ) 7,296 29 360 $ 1,248

Charge-offs 170 — 78 11,923 — 63 12,234

6 unchanged sentences

_________________________

(1) The $ 59.9 million provision for credit losses on the consolidated statement of income includes a $ 59.0 million net loan loss provision, a 902,000 provision for off-balance sheet commitments and a 30,000 provision benefit for held to maturity securities credit losses for the year ended December 31, 2020.

The increase in provision expense during the year ended December 31, 2022, is primarily due to the merger with BTH, completed on August 1, 2022, which required a Day 1 CECL loan provision of $ 14.9 million for loan credit losses on non-PCD loans along with a $ 5.5 million allowance for loan credit losses on PCD loans.

The allowance for loan credit losses increased $ 22.6 million compared to December 31, 2021, mainly due to a $ 23.9 million allowance for BTH loans at December 31, 2022.

Qualitative factor changes across the Company's risk pools, which includes the impact of the BTH acquired loans, drove a $ 22.4 million increase for the year ended December 31, 2022.

The decrease in provision expense during the year ended December 31, 2021, compared to the year ended December 31, 2020, was primarily due to improvement in forecasted economic conditions during the year ended December 31, 2021, as compared to continuing uncertainty related to ongoing economic impact and duration of the COVID-19 pandemic during the year ended December 31, 2020.

The Company's credit quality profile in relation to the allowance for loan credit losses drove a decline of $ 25.1 million in the collectively evaluated portion of the reserve during the year ended December 31, 2021, of which a $ 19.6 million decrease was related to qualitative factor changes across the Company's risk pools for the year ended December 31, 2021.

These declines were partially offset by an increase in certain specific loan reserves at December 31, 2021.

The following table presents the amortized cost basis of collateral dependent loans, which are individually evaluated to determine expected credit losses, and the related Allowance for Loan Credit Losses ("ALCL") allocated to these loans.

(1) The $ 10.8 million net benefit provision for credit losses on the consolidated statement of income includes a $ 10.8 million net benefit provision for loan losses, a $ 68,000 net benefit provision for off-balance sheet commitments and a $ 101,000 provision for held to maturity securities credit losses for the year ended December 31, 2021.

Provision expense for loan credit losses declined $ 4.1 million to $ 17.5 million for the year ended December 31, 2023, compared to $ 21.6 million for the year ended December 31, 2022.

The higher provision expense for loan credit losses during the year ended December 31, 2022, was primarily due to the Day 1 CECL loan provision of $ 14.9 million for loan credit losses on non-PCD loans associated with the BTH merger which occurred on August 1, 2022.

The Company’s credit quality profile in relation to the ALCL drove an increase of $ 5.3 million in the collectively evaluated portion of the reserve at December 31, 2023, when compared to December 31, 2022, primarily due to qualitative factor changes across the Company’s risk pools.

The individually evaluated portion of the reserve increased $ 4.4 million at December 31, 2023, when compared to December 31, 2022.

The following table presents the amortized cost basis of collateral dependent loans, which are individually evaluated to determine expected credit losses, and the related ALCL allocated to these loans.

December 31, 2023

1 unchanged sentence

Real Estate $ 605 $ — $ 4,029 $ — $ — $ — $ 4,634

Accounts Receivable — — — 831 — — 831

Equipment — — — 119 — — 119

Other — — — 258 — — 258

Total $ 605 $ — $ 4,029 $ 377 $ — $ — $ 5,011

ACL Allocation $ — $ — $ — $ 738 $ — $ — $ 738

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

ALCL Allocation $ — $ — $ — $ — $ — $ — $ —

December 31, 2022

4 unchanged sentences

Total $ 273 $ 97 $ 6,731 $ 1,116 $ — $ — $ 8,217

ACL Allocation $ — $ — $ 19 $ 6,563 $ — $ — $ 6,582

Collateral-dependent loans consist primarily of residential real estate and commercial and industrial loans.

ALCL Allocation $ — $ — $ — $ 738 $ — $ — $ 738

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Collateral-dependent loans consist primarily of residential real estate, commercial real estate and commercial and industrial loans.

These loans are individually evaluated when foreclosure is probable or when the repayment of the loan is expected to be provided substantially through the operation or sale of the underlying collateral.

1 unchanged sentence

Loan balances are charged down to the underlying collateral value when they are deemed uncollectible.

Note that the Company did not elect to use the collateral maintenance agreement practical expedient available under CECL.

Nonaccrual LHFI were as follows:

Note that the Company did not elect to use the collateral maintenance agreement practical expedient available under the current expected credit loss (“CECL”) guidance.

Nonaccrual LHFI was as follows:

Nonaccrual With No

Allowance for Credit Loss Nonaccrual

Allowance for Credit Loss Total Nonaccrual

(Dollars in thousands)

11 unchanged sentences

Total nonaccrual loans $ 11,243 $ 8,044 $ 30,115 $ 9,940

All interest accrued but not received for loans placed on nonaccrual status is reversed against interest income.

All interest formerly accrued but not received for loans placed on nonaccrual status is reversed from interest income.

Subsequent receipts on nonaccrual loans are recorded as a reduction of principal, and interest income is recorded only after principal recovery is reasonably assured.

Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

At December 31, 2022 and 2021, the Company had no funding commitments for which the terms were modified in TDRs.

For the year ended December 31, 2022, 2021 and 2020 gross interest income, that would have been recorded had the nonaccruing loans been current in accordance with their original terms, was $ 1.3 million, $ 1.9 million and $ 1.5 million, respectively.

At December 31, 2023, and December 31, 2022, the Company had $ 1.6 million and zero funding commitments for loans in which the terms were modified as a result of the borrowers experiencing financial difficulty, respectively.

For the years ended December 31, 2023, 2022 and 2021, gross interest income that would have been recorded had the nonaccruing loans been current in accordance with their original terms, was $ 1.4 million, $ 1.3 million, $ 1.9 million, respectively.

No interest income was recorded on these loans while they were considered nonaccrual during the years ended December 31, 2023, 2022, and 2021.

The Company elects the fair value option for recording residential mortgage loans held for sale in accordance with U.S.

The Company had $ 3.9 million of nonaccrual mortgage loans held for sale that were recorded using the fair value option election at December 31, 2022, compared to $ 1.8 million at December 31, 2021.

The Company transferred $ 7.1 million of nonperforming mortgage loans from the held for sale portfolio to the held for investment portfolio during the year ended December 31, 2023.

As a result, the company had zero nonaccrual mortgage loans held for sale that were recorded using the fair value option election at December 31, 2023, compared to $ 3.9 million at December 31, 2022.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Loans classified as TDRs were as follows:

(Dollars in thousands) December 31, 2022 December 31, 2021

Nonaccrual TDRs $ 4,389 $ 4,064

Performing TDRs 3,248 2,763

Total $ 7,637 $ 6,827

The tables below summarize loans classified as TDRs by loan and concession type during the dates indicated.

Year Ended December 31, 2022

(Dollars in thousands) Number of Loans Restructured Pre-Modification Recorded Balance Term Concessions Interest Rate Concessions Combination of Term and Rate Concessions Total Modifications

The table below summarizes modifications made to borrowers experiencing financial difficulty by loan and modification type during the year ended December 31, 2023.

Amortized Cost Basis at December 31, 2023

Term Extension Combination:

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

(Dollars in thousands) Amortized Cost % of Loans Amortized Cost % of Loans Amortized Cost % of Loans

Loans secured by real estate:

Commercial real estate $ 7,845 0.32 % $ — — % $ 428 0.02 %

1 $ 214 $ — $ — $ 211 $ 211

Construction/land/land development 3,979 0.37 — — — —

3 unchanged sentences

Total $ 35,516 0.46 $ 1,262 0.02 $ 579 0.01

________________________

(1) Acquired in connection with the BTH merger.

Year Ended December 31, 2021

(Dollars in thousands) Number of Loans Restructured Pre-Modification Recorded Balance Term Concessions Interest Rate Concessions Combination of Term and Rate Concessions Total Modifications

Residential real estate 1 $ 31 $ 26 $ — $ — $ 26

Commercial and industrial 1 100 100 — — 100

Total 2 $ 131 $ 126 $ — $ — $ 126

The following table describes the financial effect of the modification made to borrowers experiencing financial difficulty during the year ended December 31, 2023, respectively.

Year Ended December 31, 2023

(Dollars in thousands) Number of Loans Restructured Pre-Modification Recorded Balance Term Concessions Interest Rate Concessions Combination of Term and Rate Concessions Total Modifications

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

Commercial real estate N/A Added a weighted average 10.7 months to the life of the modified loans

Delayed payment of weighted average 6 months

Construction/land/land development N/A Added a weighted average 13.0 months to the life of the modified loans

Residential real estate Reduced weighted average contractual interest rate from 8.8 % to 6.0 %

Added a weighted average 32.8 months to the life of the modified loans

Delayed payment of weighted average 2 months

Commercial and industrial Reduced weighted average contractual interest rate from 9.9 % to 8.9 %

Added a weighted average 9.5 months to the life of the modified loans

Delayed payment of weighted average 6 months

The following table depicts the performance of loans that have been modified during the year ended December 31, 2023.

Payment Status (Amortized Cost Basis)

December 31, 2023

(Dollars in thousands) Current 30-89 Days Past Due 90 Days or More Past Due

Loans secured by real estate:

Commercial real estate

$ 8,272 $ — $ —

Construction/land/land development

Residential real estate 2,484 120 282

1 unchanged sentence

Commercial and industrial 22,219 — —

Consumer 1 2 — — 2 2

Total 13 $ 3,127 $ 1,887 $ 177 $ 879 $ 2,943

Total LHFI $ 36,954 $ 120 $ 282

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

There were no loans that defaulted during the year ended December 31, 2022, after having been modified as a TDR within the previous 12 months.

During the year ended December 31, 2021, one loan with an outstanding principal balance of $ 9,000 defaulted after having been modified as a TDR within the previous 12 months.

During the year ended December 31, 2020, no loans defaulted after having been modified as a TDR within the previous 12 months.

The table below provides the details of borrowers that were experiencing financial difficulty that were modified within the last twelve months and defaulted during the year ended December 31, 2023.

At Or For The Year Ended December 31, 2023

Term Extension

(Dollars in thousands) Amortized Cost Default Amount

Residential real estate $ 282 $ 282

Commercial and industrial — 10

Total LHFI $ 282 $ 292

A payment default is defined as a loan that was 90 or more days past due.

The Company monitors the performance of the modified loans to their restructured terms on an ongoing basis.

In the event of subsequent default, the allowance for loan credit losses continues to be reassessed on the basis of an individual evaluation of each loan.

The Company monitors the performance of modified loans on an ongoing basis.

In the event of subsequent default, the ALCL is assessed on the basis of an individual evaluation of each loan.

The modifications made during the periods presented did not significantly impact the Company’s determination of the allowance for credit losses.

2 unchanged sentences

Certain assets and liabilities are recorded in the Company’s consolidated financial statements at fair value.

Some are recorded on a recurring basis and some on a non-recurring basis.

Some are recorded on a recurring basis and some on a nonrecurring basis.

The Company utilizes fair value measurement to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures.

17 unchanged sentences

Fair Values of Assets and Liabilities Recorded on a Recurring Basis

The following tables summarize financial assets and financial liabilities recorded at fair value on a recurring basis at December 31, 2022 and 2021, segregated by the level of valuation inputs within the fair value hierarchy utilized to measure fair value.

The following tables summarize financial assets and financial liabilities recorded at fair value on a recurring basis at December 31, 2023, and December 31, 2022, segregated by the level of valuation inputs within the fair value hierarchy utilized to measure fair value.

There were no changes in the valuation techniques during 2023 or 2022.

39 unchanged sentences

Notes to Consolidated Financial Statements

The changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the year ended December 31, 2022 and 2021, are summarized as follows:

The changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the years ended December 31, 2023 and 2022, are summarized as follows:

(Dollars in thousands) MSRs Securities Available for Sale Securities at Fair Value Through Income

2 unchanged sentences

Mortgage banking revenue (1)

( 4,089 ) — —

Other noninterest income — — 725

2 unchanged sentences

Originations 708 — —

Purchases — 22,384 —

Acquired in BTH merger 1,099 — —

Sales ( 1,806 ) — —

Settlements — ( 5,129 ) ( 285 )

1 unchanged sentence

$ 15,637 $ 50,447 $ 6,808

(Dollars in thousands) Loans at Fair Value MSRs Securities Available for Sale Securities at Fair Value Through Income

___________________________

(1) Total mortgage banking revenue includes changes in fair value due to market changes and run-off.

(Dollars in thousands) MSRs Securities Available for Sale Securities at Fair Value Through Income

Balance at January 1, 2022 $ 16,220 $ 41,461 $ 7,497

1 unchanged sentence

Mortgage banking revenue (1)

— ( 2,593 ) — —

Other noninterest income — — ( 854 )

3 unchanged sentences

Purchases — 22,384 —

Acquired in BTH merger 1,099 — —

Settlements — ( 3,655 ) ( 275 )

3 unchanged sentences

(1) Total mortgage banking revenue includes changes in fair value due to market changes and run-off.

The Company obtains fair value measurements for loans at fair value, securities available for sale and securities at fair value through income from an independent pricing service;

The Company obtains fair value measurements for securities available for sale and securities at fair value through income from an independent pricing service;

therefore, quantitative unobservable inputs are unknown.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

The following methodologies were used to measure the fair value of financial assets and liabilities valued on a recurring basis:

9 unchanged sentences

In certain cases where Level 2 inputs are not available, securities are classified within Level 3 of the hierarchy.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

For level 3 securities, the Company determines the fair value of the instruments based on their callability, putability and prepay optionality.

Putable instruments are valued at book value, non-putable instruments are priced mainly using a present value calculation based on the spread to the yield curve.

Mortgage Servicing Rights (“MSRs”)

10 unchanged sentences

(1) The weighted average was calculated with reference to the principal balance of the underlying mortgages.

In recent years, there have been significant market-driven fluctuations in the assumptions listed above.

Loans with higher average coupon rates have a greater likelihood of prepayment during comparatively low interest rate environments, while loans with lower average coupon rates have a lower likelihood of prepayment.

The increase in rates since the year ended December 31, 2021, has caused a decrease in our weighted average prepayment speed and an increase in our discount rate assumptions used in the MSR valuation.

Recently there have been significant market-driven fluctuations in the assumptions listed above.

These fluctuations can be rapid and may continue to be significant.

Therefore, estimating these assumptions within ranges that market participants would use in determining the fair value of MSRs requires significant management judgment.

During the second half of 2022, the Company recognized an impairment of $ 2.0 million and entered into an agreement to sell its GNMA MSR portfolio, which met all final sale conditions in early 2023.

The Company sold approximately $ 1.8 million in GNMA MSR, with no significant additional gain or loss realized, and derecognized the related GNMA repurchase asset and offsetting liability of $ 24.6 million.

Typically, loans with higher average coupon rates have a greater likelihood of prepayment during comparatively low interest rate environments, while loans with lower average coupon rates have a lower likelihood of prepayment.

The recent increase in rates has caused a decrease in the weighted average prepayment speed.

Estimating these assumptions within ranges that market participants would use in determining the fair value of MSRs requires significant management judgment.

Fair values for interest rate swap agreements and interest rate lock commitments are based upon the amounts that would be required to settle the contracts.

1 unchanged sentence

Significant management judgment and estimation is required in determining these fair value measurements.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Fair Values of Assets Recorded on a Recurring Basis for which the Fair Value Option has been Elected

1 unchanged sentence

This election allows for a more effective offset of the changes in fair values of the assets and the derivative instruments used to economically hedge them without the burden of complying with the requirements for hedge accounting under ASC Topic 815, Derivatives and Hedging.

For assets for which the fair value has been elected, the earned current contractual interest payment is recognized in interest income, loan origination costs and fees on fair value option loans are recognized in earnings as incurred and not deferred.

At December 31, 2022 and 2021, there were no gains or losses recorded attributable to changes in instrument-specific credit risk.

For assets for which the fair value has been elected, the earned current contractual interest payment is recognized in interest income.

At December 31, 2023, and December 31, 2022, there were no gains or losses recorded attributable to changes in instrument-specific credit risk.

The following tables summarize the difference between the fair value and the unpaid principal balance for financial instruments for which the fair value option has been elected:

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____________________________

(1) $ 3.9 million of loans held for sale were designated as nonaccrual or 90 days or more past due at December 31, 2022.

Of this balance, $ 3.3 million was guaranteed by U.S.

Government agencies.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

(1) There were no loans held for sale that were designated as nonaccrual or 90 days or more past due at December 31, 2023.

December 31, 2022

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Securities carried at fair value through income 726 ( 854 ) ( 814 )

Total impact on other income ( 854 ) ( 1,065 ) 440

Total fair value option impact on noninterest income (1)

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The Company believes the fair value approximates an exit price.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Loans Held for Sale

2 unchanged sentences

Fair Value of Assets Recorded on a Nonrecurring Basis

Equity Securities without Readily Determinable Fair Values

Equity securities without readily determinable fair values totaled $ 67.4 million and $ 45.2 million at December 31, 2022 and 2021, respectively, and are shown on the face of the consolidated balance sheets.

The majority of the Company's equity investments qualify for the practical expedient allowed for equity securities without a readily determinable fair value, such that the Company has elected to carry these securities at cost adjusted for any observable transactions during the period, less any impairment.

Non-marketable equity securities held in other financial institutions

The majority of the Company’s non-marketable equity securities held in other financial institutions qualify for the practical expedient allowed for equity securities without a readily determinable fair values, such that the Company has elected to carry these securities at cost adjusted for any observable transactions during the period, less any impairment.

Non-marketable equity securities held in other financial institutions totaled $ 55.2 million and $ 67.4 million at December 31, 2023 and 2022, respectively, and are shown on the face of the consolidated balance sheets.

To date, no impairment has been recorded on the Company's investments in equity securities that do not have readily determinable fair values.

During the year ended December 31, 2023, the Company observed a price change in multiple orderly transactions for identical equity securities in one of the Company’s equity securities and adjusted the Company’s basis upwards by $ 10.1 million.

Government National Mortgage Association Repurchase Asset

The Company recorded $ 24.6 million and $ 43.4 million, respectively, at December 31, 2022 and 2021, for Government National Mortgage Association ("GNMA") repurchase assets included in loans held for sale on the consolidated balance sheets.

The assets are valued at the lower of cost or market and, where market is lower than cost, valued using anticipated sale prices for loans allocated to a sale commitment, and those unallocated to a commitment are valued based on the interest rate and term for similar loans allocated.

The Company believes the fair value approximates an exit price.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

During the second half of 2022, the Company recognized an impairment of $ 2.0 million and entered into an agreement to sell its GNMA MSR portfolio, which met all final sale conditions in early 2023.

The Company had zero and $ 24.6 million Government National Mortgage Association repurchase assets included in loans held for sale on the consolidated balance sheets at December 31, 2023, and December 31, 2022, respectively.

The assets were valued at the lower of cost or market and, where market is lower than cost, valued using anticipated sale prices for loans allocated to a sale commitment, and those unallocated to a commitment are valued based on the interest rate and term for similar loans.

During the second half of 2022, the Company entered into an agreement to sell its GNMA MSR portfolio, which met all final sale conditions in early 2023.

The Company sold $ 1.8 million in GNMA MSR, with no significant additional gain or loss realized, and derecognized the related GNMA repurchase asset and offsetting liability during the quarter ended March 31, 2023.

Individually Evaluated Loans with Credit Losses

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Loans that have experienced a credit loss with specific allocated losses are within Level 3 of the fair value hierarchy when the credit loss is determined using the fair value method.

The fair value of loans that have experienced a credit loss with specific allocated losses was approximately $ 20.7 million and $ 4.8 million at December 31, 2022 and 2021, respectively.

The fair value of loans that have experienced a credit loss with specific allocated losses was approximately $ 19.7 million and $ 20.7 million at December 31, 2023, and December 31, 2022, respectively.

Non-Financial Assets

Foreclosed assets held for sale are the only non-financial assets valued on a non-recurring basis that are initially recorded by the Company at fair value, less estimated costs to sell.

At foreclosure, if the fair value, less estimated costs to sell, of the real estate acquired is less than the Company's recorded investment in the related loan, a write-down is recognized through a charge to the allowance for loan credit losses.

Foreclosed assets held for sale are the only non-financial assets valued on a nonrecurring basis that are initially recorded by the Company at fair value, less estimated costs to sell.

At foreclosure, if the fair value, less estimated costs to sell, of the real estate acquired is less than the Company’s recorded investment in the related loan, a write-down is recognized through a charge to the ALCL.

Additionally, valuations are periodically performed by management, and any subsequent reduction in value is recognized by a charge to income.

The carrying value and fair value of foreclosed assets held for sale was estimated using Level 3 inputs based on observable market data and was $ 806,000 and $ 1.5 million at December 31, 2022 and 2021, respectively.

At December 31, 2022 and 2021, the Company had $ 10,000 and $ 5.9 million, respectively, in principal amount of residential mortgage loans in the process of foreclosure.

The carrying value and fair value of foreclosed assets held for sale was estimated using Level 3 inputs based on observable market data and was $ 3.9 million and $ 806,000 at December 31, 2023, and December 31, 2022, respectively.

At December 31, 2023, and December 31, 2022, the Company had zero and $ 10,000 , respectively, in principal amount of residential mortgage loans in the process of foreclosure.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Fair Values of Financial Instruments Not Recorded at Fair Value

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The estimated fair value approximates carrying value for variable-rate junior subordinated debentures that reprice quarterly.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

The carrying value and estimated fair values of financial instruments not recorded at fair value are as follows:

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Major classifications of premises and equipment are summarized below:

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

(Dollars in thousands) 2023 2022

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Weighted average discount rate - operating leases 4.12 % 3.71 %

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

(Dollars in thousands) December 31, 2023 December 31, 2022 December 31, 2021

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Total lease obligations $ 48,917

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Supplemental cash flow related to leases was as follows:

December 31, 2022 December 31, 2021

(Dollars in thousands) December 31, 2023 December 31, 2022

Cash paid for operating leases $ 8,131 $ 5,311

Note 8 — Goodwill and Other Intangible Assets

During 2022, the Company recorded goodwill totaling $ 94.5 million and other intangible assets totaling $ 38.4 million in connection with the merger with BTH.

During 2021, the Company recorded goodwill totaling $ 7.4 million and other intangible assets totaling $ 14.1 million in connection with the acquisitions of the Lincoln Agency and Pulley-White.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

There were zero changes to the carrying amount of goodwill during the year ended December 31, 2023.

During the year ended December 31, 2022, the Company recorded goodwill totaling $ 94.5 million and other intangible assets totaling $ 38.4 million in connection with the merger with BTH.

The components of the Company’s goodwill and other intangible assets are as follows:

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December 31, 2023

Gross Carrying Amount at Period End Beginning Balance Mergers/Acquisitions Accumulated Amortization Net Carrying Amount at Period End

Gross Carrying Amount at Period End Net Carrying Amount at the Beginning of the Period Mergers/Acquisitions Accumulated Amortization Net Carrying Amount at Period End

Goodwill $ 128,679 $ — N/A $ 128,679

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Non-compete 903 452 — ( 903 ) —

Naming rights 5,250 — — ( 128 ) 5,122

Total $ 64,977 $ 49,829 $ — $ ( 19,525 ) $ 45,452

December 31, 2022

$ 26,741 $ 7,412 N/A $ 34,153

Goodwill $ 34,153 $ 94,526 N/A $ 128,679

Other intangible assets:

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Total $ 59,727 $ 16,962 $ 38,356 $ ( 9,910 ) $ 49,829

___________________________

(1) A downward adjustment of $ 215,000 to the preliminary goodwill estimate was recorded in conjunction with the accounting of the acquisitions of the Lincoln Agency and Pulley-White subsequent to December 31, 2021, and is reflected in the goodwill amount in the above schedule.

During the year ended December 31, 2023, the Company acquired naming and logo rights on certain facilities and properties for $ 5.3 million for a defined period of time.

Core deposit intangibles acquired during the year ended December 31, 2022, represent the value of the relationships that BTH had with their deposit customers and are amortized over 10 years using an accelerated amortization methodology.

Amortization expense on other intangible assets totaled $ 5.5 million, $ 844,000 and $ 1.1 million for the years ended December 31, 2022, 2021 and 2020, respectively, and was included as a component of other noninterest expense in the consolidated statements of income.

Amortization expense on other intangible assets totaled $ 9.6 million, $ 5.5 million and $ 844,000 for the years ended December 31, 2023, 2022 and 2021, respectively, and was included as a component of other noninterest expense in the consolidated statements of income.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Estimated future amortization expense for intangible assets remaining at December 31, 2023, was as follows:

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Total $ 45,452

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Note 9 — Mortgage Banking

The following table presents the Company’s revenue from mortgage banking operations:

(Dollars in thousands) Year Ended December 31,

(Dollars in thousands) Years Ended December 31,

Mortgage banking revenue

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Origination $ 483 $ 774 $ 1,379

Gain (loss) on sale of loans held for sale 4,889 11,862 13,481

Gain on sale of loans held for sale 3,111 4,889 11,862

Originations of MSRs 708 2,286 5,153

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MSR valuation adjustments, net (1)(2)

( 4,089 ) 1,219 ( 2,593 )

Mortgage HFS and pipeline fair value adjustment ( 53 ) ( 1,352 ) ( 6,897 )

MSR hedge impact ( 543 ) ( 6,737 ) ( 1,967 )

Mortgage banking revenue (loss) $ 6,722 $ 12,927 $ 29,603

Management uses TBA mortgage-backed securities and U.S.

Mortgage banking revenue $ 3,356 $ 6,722 $ 12,927

____________________________

(1) The Company recorded a $ 1.8 million impairment on the MSR portfolio during the year ended December 31, 2023 in conjunction with the planned sale of the mortgage servicing right asset.

(2) The Company recorded a $ 2.0 million impairment on the held for sale GNMA MSR portfolio during the year ended December 31, 2022.

Management uses forward-settling mortgage-backed securities and U.S.

Treasury futures to mitigate the impact of changes in fair value of MSRs.

2 unchanged sentences

Activity in MSRs was as follows:

Year Ended December 31,

Years Ended December 31,

(Dollars in thousands) 2023 2022 2021

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Addition of servicing rights 708 2,286 5,153

Settlement of sale of GNMA MSR ( 1,806 ) — —

Valuation adjustment, net of amortization ( 4,089 ) 1,219 ( 2,593 )

Balance at end of period $ 15,637 $ 20,824 $ 16,220

During the second half of 2022, the Company recognized an impairment of $ 2.0 million and entered into an agreement to sell its GNMA MSR portfolio, which met all final sale conditions in early 2023.

During the second half of 2022, the Company entered into an agreement to sell its GNMA MSR portfolio, which met all final sale conditions in early 2023.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

The Company receives annual servicing fee income approximating 0.25 % of the outstanding balance of the underlying loans.

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When a putback claim is received, the Company evaluates the claim and takes appropriate actions based on the nature of the claim.

The Company is required by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation to provide a response to putback claims within 60 of the date of receipt.

The Company is required by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation to provide a response to putback claims within 60 days of the date of receipt.

At December 31, 2023 and 2022, the reserve for mortgage loan servicing putback expenses totaled $ 127,000 and $ 217,000 , respectively.

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Future putback expenses depend on many subjective factors, including the review procedures of the purchasers and the potential refinance activity on loans sold with servicing released and the subsequent consequences under the representations and warranties.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

GNMA optional repurchase programs allow financial institutions to buy back individual delinquent mortgage loans that meet certain criteria from the securitized loan pool for which the institution provides servicing.

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When a financial institution is deemed to have regained effective control over these loans under the unconditional buy-back option, the loans can no longer be reported as sold and must be included in the consolidated balance sheets as mortgage loans held for sale, regardless of whether the institution intends to exercise the buy-back option.

These loans totaled $ 24.6 million and $ 43.4 million at December 31, 2022 and 2021, respectively, and were recorded as mortgage loans held for sale at the lower of cost or fair value with a corresponding liability in FHLB advances and other borrowings on the Company's consolidated balance sheets.

As mentioned above, the Company sold approximately $ 1.8 million in GNMA MSR and derecognized the related GNMA repurchase asset and offsetting liability of $ 24.6 million during the first quarter of 2023.

These loans totaled $ 24.6 million at December 31, 2022, and were recorded as mortgage loans held for sale at the lower of cost or fair value with a corresponding liability in FHLB advances and other borrowings on the Company’s consolidated balance sheets.

The final sale conditions of the GNMA MSR portfolio were met during the quarter ended March 31, 2023, and, accordingly, there were no GNMA repurchase program loans on the balance sheet at December 31, 2023.

Note 10 — Deposits

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Time deposits 967,901 781,880

Brokered time deposits 444,989 5,407

Savings 269,926 326,223

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Municipal deposits totaled $ 881.5 million and $ 794.6 million at December 31, 2023 and 2022, respectively.

Included in time deposits at December 31, 2022 and 2021, are $ 322.2 million and $ 222.7 million, respectively, of time deposits in denominations of $250,000 or more.

Included in time and brokered time deposits at December 31, 2023 and 2022, are $ 894.4 million and $ 322.2 million, respectively, of time deposits in denominations of $250,000 or more.

Maturities of time deposits, at December 31, 2023, are as follows:

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

(Dollars in thousands)

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Total $ 1,412,890

At December 31, 2022 and 2021, overdrawn deposits of $ 1.3 million and $ 1.9 million, respectively, were reclassified as unsecured loans.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

At December 31, 2023 and 2022, overdrawn deposits of $ 934,000 and $ 1.3 million, respectively, were reclassified as unsecured loans.

Note 11 — Borrowings

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GNMA repurchase liability

24,569 43,355

Overnight repurchase agreements with depositors 7,124 27,921

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Short-term FHLB advance, fixed rate $ 70,000 5.68 % 1/5/2024

Short-term FHLB advance, fixed rate 100,000 4.62 1/13/2023

At December 31, 2022:

Long-term FHLB advance, callable quarterly, fixed rate 250,000 1.65 8/23/2033

Short-term FHLB advance, fixed rate $ 450,000 4.55 % 1/3/2023

Short-term FHLB advance, fixed rate 100,000 4.62 1/13/2023

Security for all indebtedness and outstanding commitments to the FHLB consists of a blanket floating lien on all of the Company’s first mortgage loans, commercial real estate and other real estate loans, as well as the Company’s investment in capital stock of the FHLB and deposit accounts at the FHLB.

The net amounts available under the blanket floating lien at December 31, 2022 and 2021, were $ 1.29 billion and $ 982.2 million, respectively.

The net amounts available under the blanket floating lien at December 31, 2023 and 2022, were $ 2.01 billion and $ 1.29 billion, respectively.

Long-Term Borrowings

Interest rates for FHLB long-term advances outstanding at December 31, 2022, ranged from 1.99 % to 4.57 %.

Interest rates for FHLB long-term advances outstanding at December 31, 2021, ranged from 1.65 % to 4.57 %.

Interest rates for FHLB long-term advances outstanding at December 31, 2023 and 2022, ranged from 1.99 % to 4.57 %.

These advances are all fixed rate and are subject to restrictions or penalties in the event of prepayment.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Scheduled maturities of long-term advances from the FHLB at December 31, 2023, are as follows:

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These BTH repurchase agreements were restructured and integrated into the Company’s repurchase agreements which include the sale and repurchase of investment securities and mature on a daily basis.

The total overnight repurchase agreements with depositors carried a daily average interest rate of 0.24 % for the year ended December 31, 2022, and 0.08 % for the year ended December 31, 2021, rated into the Company's repurchase agreements which include the sale and repurchase of investment securities and mature on a daily basis.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

The Company had unsecured lines of credit for the purchase of federal funds in the amount of $ 140.0 million at both December 31, 2022 and 2021.

The total overnight repurchase agreements with depositors carried a daily average interest rate of 2.21 % for the year ended December 31, 2023, and 0.24 % for the year ended December 31, 2022,

The Company had unsecured lines of credit for the purchase of federal funds in the amount of $ 145.0 million and $ 140.0 million at December 31, 2023 and 2022, respectively.

The Company also had a $ 75.0 million secured repurchase line of credit at December 31, 2023 and 2022.

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Amounts required to be held on deposit are typically $ 250,000 or less, and the Company has complied with all compensating balance requirements to allow utilization of these lines of credit.

Additionally, at December 31, 2022 and 2021, the Company had the availability to borrow $ 1.23 billion and $ 856.8 million, respectively, from the discount window at the Federal Reserve Bank of Dallas, with $ 1.76 billion and $ 1.09 billion in commercial and industrial loans pledged as collateral, respectively.

Additionally, at December 31, 2023 and 2022, the Company had the availability to borrow $ 1.42 billion and $ 1.23 billion, respectively, from the discount window at the Federal Reserve Bank of Dallas, with $ 1.69 billion and $ 1.76 billion in commercial and industrial loans pledged as collateral, respectively.

There were no borrowings against this line at December 31, 2023 or 2022.

Holding Company Line of Credit

On October 5, 2018, the Company entered into a Loan Agreement (the "Loan Agreement"), along with certain ancillary instruments, with NexBank SSB ("Lender") pursuant to which the Lender would make one or more revolving credit loans of up to $ 50 million to the Company, maturing October 5, 2021, which the Company could use for working capital and general corporate purposes.

On October 5, 2021, the Company entered into a first amendment to the Loan Agreement extending the maturity to November 5, 2021.

The Company entered into a Loan Agreement (the "Loan Agreement"), along with certain ancillary instruments, with NexBank SSB ("Lender") pursuant to which the Lender can make one or more revolving credit loans of up to $ 50.0 million to the Company, which can be used for working capital and general corporate purposes.

On October 29, 2021, the Company entered into a second amendment (the "Amendment") to the Loan Agreement.

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The principal amounts borrowed under the Loan Agreement bear interest at a variable rate equal to the applicable Term SOFR for the then-current SOFR Interest Period plus 3.35 % (as such terms are defined in the Loan Agreement).

Pursuant to the Amendment, the line of credit available to the Company expired on October 28, 2022, or such date of the acceleration of the obligation pursuant to the Loan Agreement, as amended, at which time all amounts borrowed, together with applicable interest, fees and other amounts owed by the Company shall be due and payable.

Pursuant to the Amendment, the line of credit available to the Company expired on October 27, 2023, at which time all amounts borrowed, together with applicable interest, fees and other amounts owed by the Company were due and payable.

The Company may extend the maturity date to a date that is three hundred and sixty-four ( 364 ) days after the then-effective maturity date, no more than two times upon (i) delivery of a written request therefor to Lender at least thirty ( 30 ) days, but no more than ( 60 ) days, prior to the maturity date then in effect;

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The Company exercised the request for extension and the maturity date was extended to October 27, 2024.

The Company had $ 30.0 million and zero outstanding on this revolving credit loan under the Loan Agreement at December 31, 2022 and 2021, respectively.

The Company had no balance outstanding on this revolving credit loan under the Loan Agreement at December 31, 2023 and $ 30.0 million outstanding at December 31, 2022.

ORIGIN BANCORP, INC.

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Subordinated Indebtedness

As detailed in the table below and included in subordinated indebtedness, net in the table above, on August 1, 2022, the Company assumed $ 37.6 million of subordinated promissory notes ("BTH Notes") from BTH.

Debt Security Issue Year Interest Rate Outstanding Amount

(Dollars in thousands)

Floating rate subordinated promissory notes due June 2025 2015 Prime + 175 bps

Floating rate subordinated promissory notes due December 2023 2016 Prime + 125 bps

Floating rate subordinated promissory notes due December 2026 2016 Prime + 175 bps

Floating rate subordinated promissory notes due December 2024 2017 Prime + 125 bps

Floating rate subordinated promissory notes due December 2027 2017 Prime + 175 bps

Floating rate subordinated promissory notes due December 2025 2018 Prime + 50 bps

Floating rate subordinated promissory notes due December 2028 2018 Prime + 75 bps

Fixed to floating rate subordinated promissory notes due June 2031 2021 Through 6/30/26:

After 6/30/26:

Prime + 75 bps

Fair value adjustment at December 31, 2022

Total assumed subordinated notes at December 31, 2022

Legacy subordinated indebtedness described below 147,894

Total subordinated indebtedness, excluding junior subordinated debt $ 185,497

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

On August 1, 2022, the Company assumed $ 37.6 million of subordinated promissory notes ("BTH Notes") from BTH.

At December 31, 2023, the Company had BTH Notes of $ 34.7 million with maturity dates ranging from December 2024 to June 2031.

Interest rates on the BTH Notes primarily reprice quarterly and range from Prime + 50 bps to Prime + 175 bps with a floor of 3.875 % on all the BTH Notes, and ceilings ranging from 6.125 % to 6.375 %.

The BTH Notes are intended to qualify for Tier 2 capital treatment and are substantively identical in terms and conditions, including priority, except for the maturity dates and interest rates payable on the notes.

5 unchanged sentences

The 4.25 % Notes initially bear interest at a fixed annual rate of 4.25 %, payable semi-annually in arrears, to but excluding February 15, 2025.

From and including February 15, 2025, to but excluding the maturity date or early redemption date, the interest rate will equal the three-month LIBOR rate (provided, that in the event the three-month LIBOR is less than zero, the three-month LIBOR will be deemed to be zero) plus 282 basis points, payable quarterly in arrears, subject to customary fallback provision upon the discontinuation of LIBOR.

On June 30, 2023, in conjunction with the customary fallback provision upon the discontinuation of LIBOR, the rate for the floating rate periods from and including February 15, 2025, on these notes transitioned to the three-month term SOFR plus 308 basis points.

Origin Bank is entitled to redeem the 4.25 % Notes, in whole or in part, on or after February 15, 2025, and to redeem the 4.25 % Notes at any time in whole upon certain other specified events.

5 unchanged sentences

The 4.50 % Notes qualify as Tier 2 capital for regulatory capital purposes for the Company and a portion was transferred to Origin Bank, which qualifies as Tier 1 capital for regulatory capital purposes for the Bank.

The balance of the subordinated indebtedness varies from the amounts carried on the consolidated balance sheets due to the remaining purchase discount of $ 3.2 million and $ 3.4 million, at December 31, 2022 and 2021, respectively, which was established at the time of issuance and is being amortized over the remaining life of the securities using the interest method.

During the year ended December 31, 2023, and with the approval of the Board of Governors of the Federal Reserve System, the Company repurchased $ 5.0 million of the 4.50 % notes in conjunction the Federal Deposit Insurance Corporation’s failed bank resolution process.

On August 1, 2022, the Company assumed BTH’s obligations with respect to $ 7.2 million in aggregate principal amount of junior subordinated debentures issued to a statutory trust of BTH ("BTH TruPS").

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Notes to Consolidated Financial Statements

The following table is a summary of the terms of the current junior subordinated debentures at December 31, 2022:

The following table is a summary of the terms of the junior subordinated debentures at December 31, 2023:

(Dollars in thousands)

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____________________________

(1) The trust preferred securities reprice quarterly based on the three-month LIBOR plus 3.30 %, with the last reprice date on October 27, 2022.

(2) The trust preferred securities reprice quarterly based on the three-month LIBOR plus 1.80 %, with the last reprice date on December 13, 2022.

(3) The trust preferred securities reprice quarterly based on the three-month LIBOR plus 1.64 % with the last reprice date on December 2, 2022.

(1) The trust preferred securities reprice quarterly based on the three-month average SOFR plus 3.30 %, with the last reprice date on October 27, 2023.

(2) The trust preferred securities reprice quarterly based on the three-month CME Term SOFR plus 1.80 %, plus 0.26161 % SOFR spread adjustment, with the last reprice date on December 13, 2023.

(3) The trust preferred securities reprice quarterly based on the three-month CME Term SOFR plus 1.64 %, plus 0.26161 % SOFR spread adjustment, with the last reprice date on December 4, 2023.

The balance of the subordinated indebtedness varies from the amounts carried on the consolidated balance sheets due to the remaining original issue and purchase discount of which was established at the time of issuance or purchase and is being amortized over the remaining life of the securities using the interest method.

Note 12 — Derivative Financial Instruments

14 unchanged sentences

These are accounted for at fair value and disclosed as risk participation derivatives.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Mortgage banking derivatives

2 unchanged sentences

The Company also economically hedges the value of MSRs by entering into a series of commitments to purchase mortgage-backed securities in the future and U.S.

Treasury future contracts.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Treasury Notes.

Fair Values of Derivative Instruments on the Consolidated Balance Sheets

1 unchanged sentence

Derivative instruments and their related gains and losses are reported in other operating activities, net in the statements of cash flows.

Notional Amounts (1)

(Dollars in thousands)

(Dollars in thousands) Notional Amounts (1)

Derivatives designated as cash flow hedging instruments:

5 unchanged sentences

356,683 345,742 ( 18,298 ) ( 25,175 )

Risk participation agreements included in accrued expenses and other liabilities on the consolidated balance sheets 59,738 63,374 — ( 2 )

Forward commitments to purchase TBA mortgage-backed securities included in other liabilities 7,000 80,000 ( 100 ) ( 627 )

Risk participation agreements included in other liabilities 20,000 59,738 ( 2 ) —

Forward commitments to purchase forward-settling mortgage-backed securities included in other assets (liabilities) 9,000 7,000 91 ( 100 )

Forward commitments to purchase treasury notes in other assets 22,500 31,500 822 —

6 unchanged sentences

These amounts are typically not exchanged, significantly exceed amounts subject to credit or market risk and are not reflected in the consolidated balance sheets.

The weighted-average rates paid and received for interest rate swaps at December 31, 2022, were as follows:

The weighted-average rates paid and received for interest rate swaps were as follows:

Weighted-Average Interest Rate

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Non-hedging interest rate swaps - customer counterparties 7.82 4.88 5.75 3.72

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Gains and losses recognized on derivative instruments not designated as hedging instruments are as follows:

2 unchanged sentences

2023 2022 2021

Amount of (loss) gain recognized in mortgage banking revenue (1)

Amount of loss recognized in mortgage banking revenue (1)

$ ( 573 ) $ ( 2,813 ) $ ( 3,118 )

Amount of gain (loss) recognized in other non-interest income 655 816 ( 307 )

Amount of (loss) gain recognized in other non-interest income ( 41 ) 655 816

____________________________

3 unchanged sentences

The Company has chosen not to net these exposures in the consolidated balance sheets, and any impact of netting these amounts would not be significant.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

At December 31, 2022 and 2021, the Company had cash collateral on deposit with swap counterparties totaling $ 7.6 million and $ 16.5 million, respectively.

At December 31, 2023 and 2022, the Company had cash collateral on deposit with swap counterparties totaling $ 865,000 and $ 7.6 million, respectively.

These amounts are included in interest-bearing deposits in banks in the consolidated balance sheets and are considered restricted cash until such time as the underlying swaps are settled.

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At December 31, 2023, the maximum number of shares of the Company’s common stock available for issuance under the 2012 Plan was 33,365 shares.

Additionally, in April 2021, an employee stock purchase plan ("ESPP") was approved by the Company's stockholders and qualified as an ESPP under IRS guidelines.

The ESPP provides for the purchase of up to an aggregate one million shares of the Company's common stock by employees, and the total number of shares available for issuance at December 31, 2022, was 973,911 .

Additionally, the Company’s stockholders approved an employee stock purchase plan (“ESPP”) which qualified as an ESPP under IRS guidelines.

The ESPP provides for the purchase of up to an aggregate one million shares of the Company’s common stock by employees.

Under the ESPP, employees of the Company, who elect to participate, have the right to purchase a limited number of shares of the Company’s common stock at a 15 % discount from the lower of the market value of the common stock at the beginning or the end of each one year offering period, beginning on June 1st.

The ESPP benefit is treated as compensation to the employee, and the compensation expense will be recognized over the service period based on the fair value of the rights on the grant date, adjusted for forfeitures and certain modifications.

Under the ESPP, employees purchased 26,089 shares during the year ended December 31, 2022, and no shares of common stock were issued pursuant to the ESPP during the year ended December 31, 2021.

In February 2022, the Compensation Committee ("Committee") approved and the Company granted PSUs to select officers and employees under the 2012 Plan.

The ESPP benefit is treated as compensation to the employee, and the compensation expense will be recognized over the service period based on the grant date fair value of the rights determined at the beginning of the purchase period, adjusted for forfeitures and certain modifications.

At December 31, 2023, there was $ 188,000 of total unrecognized compensation cost related to estimated ESPP shares for the June 1, 2023, ESPP purchase period.

These costs are expected to be recognized over a period of 0.42 year.

The table below includes the weighted-average assumptions used to calculate the grant date fair value of the ESPP rights for the periods indicated using the Black-Scholes option pricing model:

Years Ended December 31,

2023 2022 2021

Expected term (in years) 1.00 1.00 1.00

Dividend yield $ 1.88 $ 1.41 $ 1.25

Risk-free interest rate 3.90 % 1.24 % 0.10 %

Expected volatility 31.63 37.90 45.96

The ESPP shares purchased are as follows for the dates indicated:

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Years Ended December 31,

2023 2022 2021

ESPP shares purchased 46,213 26,089 —

Shares available for issuance under the ESPP 927,698 973,911 1,000,000

The Compensation Committee (“Committee”) has approved and the Company has granted PSUs to select officers and employees under the 2012 Plan.

Each PSU represents a right for the participant to receive shares of Company common stock or cash equal to the fair market value of such stock, as determined by the Committee.

The number of PSUs to which the participant may be entitled will vary from 0 % to 150 % of the target number of PSUs, based on the Company’s achievement of specified performance criteria during the performance period compared to performance benchmarks adopted by the Committee and, further, the participant’s continuous service with the Company through the third anniversary of the date of the grant.

The performance period is the three-year period commencing on January 1, 2022, and ending on December 31, 2024 ("Performance Period").

Each performance period commences on January 1 and ends three years later on December 31, (“Performance Period”).

On December 7, 2022, the Committee and the independent members of the Board also approved a special, one-time stock award to Drake Mills, the Company’s President and Chief Executive Officer (the “One-Time Award”), having an approximate value of $ 10,000,000 , was comprised of 129,736 restricted stock units (“CEO RSUs”) and 129,735 market-based performance stock units (“CEO PSUs”), and was effective as of December 13, 2022, (the “Grant Date”).

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2012 Stock Incentive Plan and the Company’s form of RSU agreement and PSU agreement, respectively.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Compensation expense for the CEO PSUs will be recognized over the vesting period of the awards based on the fair value of the award at the grant date determined by using a Monte Carlo simulation model with the following inputs:

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Treasury Yield constant maturity curve on the valuation date.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Share-based compensation cost charged to income for the years ended December 31, 2023, 2022 and 2021, is presented below.

There was no stock option expense for any of the periods shown.

Year Ended December 31,

Years Ended December 31,

(Dollars in thousands) 2023 2022 2021

RSA & RSU $ 4,321 $ 2,845 $ 2,100

PSU 534 288 —

ESPP 426 316 195

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The Company’s PSU awards, excluding the CEO PSUs, are three-year cliff-vested awards, with each unit divided into two categories (“ROAA Unit Group” and “ROAE Unit Group”), composed of an equivalent number of initial PSUs granted.

The PSUs do not reflect potential increases or decreases resulting from the interim performance results until the final performance results are determined at the end of the three-year period.

The PSU share amounts do not reflect potential increases or decreases resulting from the interim performance results until the final performance results are determined at the end of the three-year period.

The ROAA Unit Group is based upon the Company’s Performance Period Return on Average Assets performance, and the ROAE Unit Group is based upon the Company’s Performance Period Return on Average Equity performance.

The PSUs are initially valued utilizing the fair value of the Company’s stock at the grant date, assuming 100 % of the target number of units are achieved.

Subsequent valuation of the PSUs is determined using the ratio of the actual Company's Performance Period ROAA or ROAE to the Company's targeted Performance Period ROAA or ROAE, applied to the PSUs awarded times the Company's period end stock price.

Subsequent valuation of the PSUs is determined using the ratio of the actual Company’s Performance Period ROAA or ROAE to the Company’s targeted Performance Period ROAA or ROAE, applied to the PSUs awarded times the Company’s closing month end stock price for the month immediately preceding the period end date.

The determination of whether and to what extent the performance criteria has been satisfied during the applicable Performance Period shall be made by the Compensation Committee, in its sole and absolute discretion.

Certain nonrecurring, unusual or infrequent items may be disregarded in the ROAA or ROAE calculation as described further in the PSU award agreement.

Forfeitures are recognized as they occur.

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The following table summarizes the Company’s award activity:

Year Ended December 31,

Years Ended December 31,

2023 2022 2021

Shares Weighted Average Grant-Date Fair Value Shares Weighted Average Grant-Date Fair Value Shares Weighted Average Grant-Date Fair Value

Nonvested RSA shares, January 1, 48,048 $ 35.27 103,359 $ 31.51 149,449 $ 35.15

Granted RSA 12,840 37.39 13,460 42.26 30,638 20.14

Vested RSA ( 33,497 ) 36.00 ( 67,825 ) 31.07 ( 72,325 ) 33.88

Forfeited RSA — — ( 946 ) 24.69 ( 4,403 ) 37.11

Nonvested RSA shares, December 31,

Nonvested RSAs, January 1, 27,391 $ 35.37 48,048 $ 35.27 103,359 $ 31.51

Granted RSAs 16,788 28.61 12,840 37.39 13,460 42.26

Vested RSAs ( 26,550 ) 35.11 ( 33,497 ) 36.00 ( 67,825 ) 31.07

Forfeited RSAs — — — — ( 946 ) 24.69

Nonvested RSAs, December 31,

17,629 29.33 27,391 35.37 48,048 35.27

Nonvested RSU, January 1, 73,977 $ 40.64 — $ — — $ —

Granted RSU 222,282 39.43 73,977 40.64 — —

Vested RSU ( 24,028 ) 40.56 — — — —

Forfeited RSU ( 1,841 ) 43.48 — — — —

Nonvested RSU, December 31,

Nonvested RSUs, January 1, 270,390 $ 39.63 73,977 $ 40.64 — $ —

Granted RSUs 116,098 35.65 222,282 39.43 73,977 40.64

Vested RSUs ( 55,614 ) 41.98 ( 24,028 ) 40.56 — —

Forfeited RSUs ( 12,706 ) 41.59 ( 1,841 ) 43.48 — —

Nonvested RSUs, December 31,

318,168 37.69 270,390 39.63 73,977 40.64

Nonvested PSU, January 1, — $ — — $ — — $ —

Granted PSU 157,367 29.06 — — — —

Adjustment due to performance — — — — — —

Nonvested PSU, December 31,

Nonvested PSUs, January 1, 157,367 $ 29.06 — $ — — $ —

Granted PSUs 43,591 31.77 157,367 29.06 — —

Forfeited PSUs ( 3,116 ) 31.77 — — — —

Nonvested PSUs, December 31,

197,842 28.33 157,367 29.06 — —

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The table below summarizes the status of the Company’s stock options and changes during the years ended December 31, 2023, 2022, and 2021.

(Dollars in thousands, except per share amounts) Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term

(in years) Aggregate Intrinsic Value

(Dollars in thousands, except per share amounts) Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value

Year Ended December 31, 2023

Outstanding at January 1, 2023 504,437 $ 29.46 5.13 $ 3,736

BTH options converted to OBNK options 611,676 28.62 — 8,838

Exercised ( 135,746 ) 23.61 — 1,533

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Outstanding at January 1, 2022 39,200 $ 10.73 2.28 $ 1,262

BTH options converted to OBK options 611,676 28.62 — 8,838

Exercised ( 144,785 ) 20.80 — 2,992

Expired ( 1,654 ) 34.44 — —

Outstanding and exercisable at December 31, 2022

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Typically, payments to participants reduce the accrual and any actuarial adjustments are netted with the expense.

The expense recorded for the deferred compensation plan totaled $ 1.1 million, $ 1.1 million, and $ 1.9 million for the years ended December 31, 2022, 2021 and 2020, respectively.

The expense recorded for the deferred compensation plan totaled $ 452,000 for the year ended December 31, 2023, and $ 1.1 million for each of the years ended December 31, 2022 and 2021.

On December 7, 2022, the Company’s Board of Directors approved the Origin Bank Nonqualified Deferred Compensation Plan (the “DCP”), pursuant to which certain employees, including the Company’s named executive officers, may elect to participate.

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The DCP does not provide any above-market returns or preferential earnings to participants, and, with the exception of Company contributions, the deferrals and their earnings are always 100 % vested.

Participants may elect at the time they make their deferral elections to receive in-service and/or separation from service distributions, either as a lump sum payment or in substantially equal annual installments over a period of 5 years or 10 years, respectively.

Participants may elect, at the time they make their deferral elections, to receive in-service distributions or separation from service distributions.

Distributions can be paid either as a lump sum payment or in substantially equal annual installments, over a period of up to 5 years for in-service distributions, or over a period of up to 10 years for separation from service distributions.

There was no deferred compensation liability or expense recorded pursuant to the DCP plan during the periods covered by this report.

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The provision for income taxes is as follows:

(Dollars in thousands) Year Ended December 31,

(Dollars in thousands) Years Ended December 31,

Federal income taxes:

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A reconciliation of income tax expense at the statutory rate to the Company’s actual income tax expense is below:

Year Ended December 31,

Years Ended December 31,

2023 2022 2021

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Mortgage servicing rights 3,378 4,499

Deferred Income 2,181 —

Other 361 341

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Note 16 — Accumulated Other Comprehensive (Loss) Income

Accumulated other comprehensive income (loss) income ("AOCI") includes the after-tax change in unrealized gains and losses on AFS securities and cash flow hedging activities.

Accumulated other comprehensive (loss) income (“AOCI”) includes the after-tax change in unrealized gains and losses on AFS securities and cash flow hedging activities.

(Dollars in thousands) Unrealized (Loss) Gain on AFS Securities Unrealized Gain (Loss) on Cash Flow Hedges Accumulated Other Comprehensive (Loss) Income

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Balance at December 31, 2023

$ ( 121,646 ) $ 623 $ ( 121,023 )

Note 17 — Capital and Regulatory Matters

The Company (on a consolidated basis) and the Bank is subject to various regulatory capital requirements administered by federal and state banking agencies.

The Company (on a consolidated basis) and the Bank are subject to various regulatory capital requirements administered by federal and state banking agencies.

Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s consolidated financial statements.

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Failure to meet the full amount of the buffer will result in restrictions on the Company’s ability to make capital distributions, which include dividend payments, stock repurchases and to pay discretionary bonuses to executive officers.

Quantitative measures established by regulation to ensure capital adequacy require the Company and Origin to maintain minimum amounts and ratios (set forth in the table below) of total, common equity Tier 1 capital, Tier 1 capital, Tier 1 capital, and total capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier 1 capital (as defined) to average total consolidated assets (as defined).

Management believes, at December 31, 2022 and 2021, that the Company and Origin met all capital adequacy requirements to which they are subject, including the capital buffer requirement.

At December 31, 2022 and 2021, Origin's capital ratios exceeded those levels necessary to be categorized as "well capitalized" under the regulatory framework for prompt corrective action.

To be categorized as "well capitalized," Origin must maintain minimum total risk-based, common equity Tier 1 capital, Tier 1 risk-based and Tier 1 leverage ratios as set forth in the table below.

Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios (set forth in the table below) of total, common equity Tier 1 and Tier 1 capital to risk-weighted assets (as defined), and of Tier 1 capital (as defined) to average total consolidated assets (as defined).

Management believes, at December 31, 2023, and December 31, 2022, that the Company and the Bank met all capital adequacy requirements to which they are subject, including the capital buffer requirement.

At December 31, 2023, and December 31, 2022, the Bank’s capital ratios exceeded those levels necessary to be categorized as “well capitalized” under the regulatory framework for prompt corrective action.

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

A final rule adopted by the federal banking agencies in February 2019 provides banking organizations with the option to phase in, over a three-year period, the adverse day-one regulatory capital effects of the adoption of CECL.

In addition, on March 27, 2020, the federal banking agencies issued an interim final rule that gives banking organizations that were required to implement CECL before the end of 2020 the option to delay for two years CECL’s adverse effects on regulatory capital.

Origin elected to adopt CECL in the first quarter of 2020 and exercised the option to delay the estimated impact of the adoption of CECL on the Company's regulatory capital for two years (from January 2020 through December 31, 2021).

The Bank elected to adopt CECL in the first quarter of 2020 and exercised the option to delay the estimated impact of the adoption of CECL on the Company’s regulatory capital for two years (from January 2020 through December 31, 2021).

The two-year delay is followed by a three-year transition period of CECL’s initial impact on the Company’s regulatory capital (from January 1, 2022, through December 31, 2024).

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Notes to Consolidated Financial Statements

The actual capital amounts and ratios of the Company and Origin at December 31, 2022 and 2021, are presented in the following table:

The actual capital amounts and ratios of the Company and the Bank at December 31, 2023, and December 31, 2022, are presented in the following table:

(Dollars in thousands)

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Stock Repurchases

In July 2019, the Company's board of directors authorized a stock repurchase program pursuant to which the Company was authorized purchase up to $ 40 million of its outstanding common stock.

The stock repurchase program was approved for a period of three years and expired in June 2022, having repurchased a total of $ 28.0 million of outstanding common stock.

In July 2022, the Board of Directors of the Company authorized a stock repurchase program pursuant to which the Company may, from time to time, purchase up to $ 50 million of its outstanding common stock.

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The stock repurchase program does not obligate the Company to purchase any shares at any time.

There have been no stock repurchases during the year ended December 31, 2022.

There have been no stock repurchases during the years ended December 31, 2023 or December 31, 2022 .

ORIGIN BANCORP, INC.

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____________________________

(1) Includes $ 594.6 million and $ 513.0 million of unconditionally cancellable commitments at December 31, 2022 and 2021, respectively.

(1) Includes $ 759.4 million and $ 594.6 million of unconditionally cancellable commitments at December 31, 2023, and December 31, 2022, respectively.

At December 31, 2023, the Company held 31 unfunded letters of credit from the FHLB totaling $ 693.6 million, with expiration dates ranging from January 14, 2024, to September 22, 2027.

At December 31, 2021, the Company held 43 unfunded letters of credit from the FHLB totaling $ 599.3 million, with expiration dates ranging from January 20, 2022, to March 22, 2023.

The Company has a total contingent liability of $ 3.1 million as of December 31, 2022, for retention bonuses and guaranteed minimum incentives.

The contingent liability consists of retention bonuses totaling $ 1.0 million for former BTH employees, with $ 523,000 , or 50 %, due at December 31, 2023, and the remaining $ 523,000 , or 50 %, due at December 31, 2024.

Additionally, the Company will pay $ 2.0 million, in total, in guaranteed minimum incentives to certain employees, with approximately 42 % due on or about December 31, 2023, and 29 % each due on or about December 31, 2024 and 2025, respectively.

In all cases, continued employment through the payout date is required in order to receive the compensation.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

In conjunction with the December 31, 2021, acquisitions of the Lincoln Agency, LLC and Pulley-White Insurance Agency, Inc., the Company has a total fair value contingent liability of $ 1.5 million and $ 1.4 million as of December 31, 2022 and 2021, respectively.

The amount is payable if Davison Insurance Agency, LLC, the acquirer and surviving wholly-owned subsidiary of the Company, meets certain revenue growth objectives over three years .

The fair value and probability of payout of this liability is reassessed annually at the fiscal year end of the Company.

At December 31, 2022, the Company held 28 unfunded letters of credit from the FHLB totaling $ 277.4 million, with expiration dates ranging from January 14, 2023, to September 22, 2027.

Management establishes an asset-specific allowance for certain lending-related commitments and computes a formula-based allowance for performing consumer and commercial lending-related commitments.

These are computed using a methodology similar to that used for the commercial loan portfolio, modified for expected maturities and probabilities of drawdown.

The reserve for lending-related commitments was $ 4.6 million and $ 2.3 million at December 31, 2022 and 2021, respectively, and is included in accrued expenses and other liabilities in the accompanying consolidated balance sheets.

The reserve for lending-related commitments was $ 4.7 million and $ 4.6 million at December 31, 2023, and December 31, 2022, respectively, and is included in accrued expenses and other liabilities in the accompanying consolidated balance sheets.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Loss Contingencies

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Retained earnings 500,419 435,416

Accumulated other comprehensive (loss) income ( 159,875 ) 5,729

Accumulated other comprehensive loss ( 121,023 ) ( 159,875 )

Total stockholders’ equity 1,062,905 949,943

Total liabilities and stockholders’ equity $ 1,191,143 $ 1,115,157

(Dollars in thousands) Year Ended December 31,

(Dollars in thousands) Years Ended December 31,

Condensed Statements of Income 2023 2022 2021

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Income before income taxes and equity in undistributed net income of subsidiaries 54,502 7,161 15,195

Income tax benefit 3,359 762 549

Income tax (expense) benefit ( 943 ) 3,359 762

Income before equity in undistributed net income of subsidiaries 53,559 10,520 15,957

11 unchanged sentences

Amortization of subordinated indebtedness discount including purchase accounting adjustment 220 181 147

Gain on equity securities without a readily determinable fair value ( 10,096 ) — —

Gain on repurchase of subordinated debentures ( 471 ) — —

Other, net ( 4,540 ) 4,805 ( 5,898 )

Net cash (used in) provided by operating activities 13,252 10,213 18,772

Net cash provided by operating activities 43,123 13,252 10,213

Cash flows from investing activities:

Lincoln Agency and Pulley-White acquisitions — ( 7,457 ) —

Lincoln Agency, LLC and Pulley-White Insurance Agency acquisitions — — ( 7,457 )

BTH acquisition — 44,265 —

Capital contributed to subsidiaries — — ( 51,000 )

Net purchases of non-marketable equity securities held in other financial institutions — — ( 3,612 )

Capital calls on limited partnership investments ( 2,454 ) ( 3,722 ) ( 513 )

Net cash provided by (used in) investing activities 40,543 ( 11,582 ) ( 51,000 )

Net cash (used in) provided by investing activities ( 2,454 ) 40,543 ( 11,582 )

Cash flows from financing activities:

Proceeds from short-term borrowings — 30,000 —

Repayments on short-term borrowings ( 30,000 ) — —

Dividends paid ( 18,567 ) ( 15,887 ) ( 11,525 )

Cash received on exercise of stock options 3,140 2,998 146

Proceeds from issuance of subordinated indebtedness — — 78,556

Payment to repurchase common stock — ( 1,256 ) ( 723 )

Net cash provided by (used by) financing activities 17,111 ( 12,635 ) 69,227

Net increase (decrease) in cash and cash equivalents 70,906 ( 14,004 ) 36,999

Repurchase of subordinated debentures, net ( 4,729 ) — —

Maturities of subordinated debentures ( 2,625 ) — —

Net cash (used in) provided by financing activities ( 52,781 ) 17,111 ( 12,635 )

Net (decrease) increase in cash and cash equivalents ( 12,112 ) 70,906 ( 14,004 )

Cash and cash equivalents at beginning of year 99,810 28,904 42,908

Cash and cash equivalents at end of year $ 87,698 $ 99,810 $ 28,904

Note 21 — Business Combinations

BT Holdings, Inc.

On August 1, 2022, the Company completed its merger with BT Holdings, Inc.

(“BTH”), a Texas corporation and the registered bank holding company of BTH Bank, acquiring 100 % of the voting equity interests of BTH.

The Company issued 6,794,910 shares of its common stock, and all outstanding BTH common stock options were converted into options to purchase an aggregate of 611,676 shares of Origin common stock.

Based on the closing price of the Company’s common stock on July 29, 2022, of $ 43.07 per share, the aggregate consideration to be paid to holders of BTH common stock in connection with the merger is valued at approximately $ 307.8 million.

Goodwill of $ 94.5 million was recorded as a result of the transaction.

The merger added new markets for expansion and brings complementary businesses together to drive synergies and growth, which are the factors that gave rise to the goodwill recorded.

The goodwill will not be deductible for tax purposes.

Origin Bank and BTH Bank, N.A.

operated as separate banking subsidiaries of the Company until the merger of the banks, which Origin completed on October 7, 2022, concurrently with the data processing conversion.

BTH formerly operated its banking business from 13 locations in East Texas, Dallas and Fort Worth, Texas, each of which now operates as a banking location of Origin Bank.

ORIGIN BANCORP, INC.

Notes to Consolidated Financial Statements

Note 22 - Subsequent Events

During the second half of 2022, the Company entered into an agreement to sell substantially all of its GNMA mortgage servicing rights portfolio, recognized an impairment of $ 2.0 million, and met all final sale conditions in early 2023.

The sale was completed in February 2023.

For further information on the sale, please see Note 10 - Mortgage Banking in these notes to the consolidated financial statements.

The Company has determined that the merger of the net assets of BTH constitutes a business combination as defined by the ASC Topic 805.

Accordingly, the assets acquired and liabilities assumed are presented at their fair values as required.

Fair values were determined based on the requirements of ASC Topic 820.

The Company has finalized its analysis of the loans acquired along with the other acquired assets and assumed liabilities related to the merger with BT Holdings, Inc.

The following schedule is a breakdown of the assets acquired and liabilities assumed as of the merger date:

BT Holdings, Inc.

(Dollars in thousands) As Recorded by Origin

Assets Acquired:

Cash and cash equivalents $ 69,953

Investment securities 456,808

Loans acquired 1,239,532

Allowance for credit losses on loans ( 5,527 )

Loans receivable, net 1,234,005

Premises and equipment 17,825

Non-marketable equity securities held in other financial institutions 5,873

Core deposit intangible 38,356

Other assets 23,778

Total assets acquired $ 1,846,598

Liabilities Assumed:

Noninterest-bearing deposits $ 398,089

Interest-bearing deposits 865,864

Time deposits 302,506

Total deposits 1,566,459

Securities sold under agreements to repurchase 10,133

Subordinated indebtedness, net 44,074

Accrued expenses and other liabilities 12,674

Total liabilities assumed 1,633,340

Net assets acquired 213,258

Purchase price 307,784

Goodwill $ 94,526

The Company’s operating results include the operating results of the acquired assets and assumed liabilities of BTH subsequent to the merger date.

Acquisition Accounting.

The following is a description of the methods used to determine the fair values of significant assets and liabilities acquired as part of a merger or acquisition.

The Company elected to use the pushdown accounting method to record the merger.

The discount rates used for PCD loans were based on current market rates and include adjustments for liquidity concerns.

The discount rate does not include a factor for credit losses, as that has been included in the estimated cash flows.

Non-PCD loans were grouped together according to similar characteristics and were treated in the aggregate when applying valuation techniques.

See Note 4 — Loans in these notes to the consolidated financial statements for more information related to loans acquired.