What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-02-27 compared with 2025-02-28 · 152 added, 183 removed, 360 unchanged (48% of the section changed)

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The Bank also conducts its business at 41 branch offices and various deposit production facilities located throughout central and southern New Jersey and major metropolitan areas of New York City and Philadelphia.

The Bank also operates commercial loan production offices in New Jersey, New York City, the greater Philadelphia area, Pittsburgh, Washington D.C., Baltimore, and Boston.

The Bank also operates commercial loan production offices in New Jersey, New York City, the greater Philadelphia area, Pittsburgh, Washington D.C., Baltimore, Boston and Northern Virginia.

The Company’s results of operations are primarily dependent on net interest income, which is the difference between the interest income earned on interest-earning assets, such as loans and investments, and the interest expense on its interest-bearing liabilities, such as deposits and borrowings.

The Company also generates non-interest income such as income from bankcard services, trust and fiduciary services, deposit account services, and commercial loan swap income.

The Company also generates non-interest income such as income from bankcard services, trust and asset management products and services, deposit account services, sales of loans and investments, bank owned life insurance and commercial loan swap income.

The Company’s operating expenses primarily consist of compensation and employee benefits, occupancy and equipment, marketing, federal deposit insurance and regulatory assessments, data processing, check card processing, professional fees and other general and administrative expenses.

The Company’s results of operations are significantly affected by competition, general economic conditions, including levels of unemployment and real estate values, as well as changes in market interest rates, inflation, government policies and actions of regulatory agencies.

The Company operates as a full-service regional community bank delivering comprehensive financial products and services, which includes commercial and consumer financing, deposit services, and wealth management products and services, throughout New Jersey and in the major metropolitan areas between Massachusetts and Virginia.

The Company competes with larger, out-of-market financial service providers through its local and digital focus and the delivery of superior service.

The Company operates as a full-service regional community bank delivering comprehensive financial products and services, which includes commercial financing, deposit services, and wealth management products and services, throughout New Jersey and in the major metropolitan areas from Massachusetts through Virginia.

The Company competes with larger, out-of-market financial service providers through its entrenched presence in local markets, digital delivery channels, and agility to provide superior service at speed.

The Company also competes with smaller in-market financial service providers by offering a broad array of products and services as well as the ability to extend larger credits.

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(2) grow the commercial banking business, with a particular focus on strengthening commercial and industrial banking;

(3) expand the residential lending business, focusing on the secondary market and saleable loan business;

and (4) improve operating efficiency through the ongoing investment in information technology.

and (3) improve operating efficiency through the ongoing investment in information technology and infrastructure.

On October 15, 2025, the Company outsourced its residential loan originations, which also included home equity loans and lines and other consumer, to a national mortgage banking company.

The Company continued to process outstanding commitments to originate residential and consumer loans through December 2025.

As of December 31, 2025, the Company had $9.5 million of residential loans and no consumer loans in the pipeline, which represents the remaining commitments expected to close in 2026.

The Company focuses on prudent growth to create value for stockholders, which may include opportunistic acquisitions.

The Company will also continue to build additional operational infrastructure and invest in key personnel in response to growth and changing business conditions.

Refer to Item 1 - Recent Developments for further discussion on the pending merger with Flushing.

The Company has continued to maintain and strengthen its liquidity and capital position, while servicing its customers and communities.

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The Company continues to focus on deposit growth through a series of initiatives intended to both grow deposits and diversify sources of liquidity.

The Company seeks to increase deposits in its primary market area by improving market penetration and expanding deposit gathering initiatives and hires.

The Company seeks to increase deposits in its primary market area by improving market penetration, expanding deposit gathering initiatives and investing in deposit focused talent acquisition.

In 2025, the Company added Premier Banking teams for relationship driven, team based approach to service resulting in superior high touch client experience.

As a result, the Company is focused on growing commercial deposit relationships through this stable low cost deposit vertical as another funding lever to support future loan growth.

The Company has benefited from and remains focused on efforts to attract business deposits in conjunction with its commercial lending operations and from an expanded mix of retail products and services.

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The Company supports commercial business clients of varying sizes and complexity through the extension of credit and cash management services through its advisory relationship management model.

The Company has had success in developing new client relationships in the Company’s focused expansion markets, which include Philadelphia, New York, Boston and Baltimore.

Expanding the Company’s geographies and diversifying the loan book provides a hedge on risks deriving from a concentration in a single market.

The Company has had success in developing new client relationships in the Company’s focused expansion markets, which include Boston, Northern Virginia and Baltimore.

Expanding the Company’s geographies and diversifying the loan book provides a hedge on risks deriving from concentration in a single market.

While these growth markets are important to the Company’s strategy, the Company has continued efforts to keep the community bank feel for customers, employees, and stakeholders, which has been a focal point for longstanding stable funding, brand reputation, and community development efforts in the Company’s legacy markets.

The Company’s early expansion efforts were dependent on commercial real estate (“CRE”) lending;

The Company’s early expansion efforts were dependent on CRE lending;

however, its path forward as a regional bank includes a transition away from CRE dependence and a focus on future growth predominately around the C&I portfolio.

The Company has continued to make significant efforts to recruit new relationship managers that specialize in clients operating in deposit heavy industries.

The Company anticipates that the acquisition of these customers will help to drive quality funding through deeper deposit relationships.

The Company anticipates that the acquisition of these customers will continue to help drive quality funding through deeper deposit relationships.

Additionally, the Company continues to improve its treasury management capabilities by enhancing services through expanded product offerings and thoughtfully evaluating opportunities to further bolster talent and technology to better serve the Company’s customers.

At December 31, 2025, commercial loans (which includes multi-family and commercial real estate loans, commercial construction loans, and commercial and industrial loans) represented 69.2% of the Company’s total loans, as compared to 67.4% at December 31, 2024, of which commercial and industrial loans represented 20.1% of total loans as compared to 15.3% at December 31, 2024.

Commercial loan products entail a higher degree of credit risk than residential real estate lending activity.

Commercial loan products entail a higher degree of credit risk than other real estate lending activity.

As a result, management continues to employ a well-defined credit policy focusing on quality underwriting and close oversight and Board monitoring.

See Risk Factors – Risks Related to Lending Activities – The Company’s emphasis on commercial lending may expose the Company to increased lending risks .

Investments in Residential Lending

The Company continued its expansion of the residential lending business into new and adjacent geographies, which included the recruitment of leadership roles and sales personnel in expanded geographies and a focus on secondary marketing and saleable loans.

While the economic environment in 2024, with continued higher rates, was a headwind, the Company remains committed to this segment and has deepened its focus on the longstanding commitment to its communities with enhanced products and pricing in the NeighborFirst and special credit programs, expansion of product offerings, and the recruitment of Community Reinvestment Act (“CRA”) residential loan officers for the Company’s footprint.

The Company has a long history as a residential lender and continues to expand this portfolio with a continued focus on customer relationships.

At December 31, 2024, residential loans represented 30.3% of the Company’s total loans as compared to 28.9% at December 31, 2022.

Operating Efficiency

The Company relies on technology and the resources that support its operations to provide a broad suite of financial services and experience to its customers and employees, to differentiate the Company in its diverse markets, and to drive operational efficiencies that yield performance with strong customer services.

The Company’s investment in technology lays a foundation for future growth, scale, and operational efficiency while maintaining a secure and robust cybersecurity framework.

Focus areas include digital-direct customer engagement, efficient customer servicing, supporting safe banking operations and strategic technology change, and competitively delivering new lending and customer self-service capabilities in the post-pandemic influenced environment.

The Company’s investment in technology, including modern data model incorporating artificial intelligence into processing efforts, lays a foundation for future growth, scale, and operational efficiency while maintaining a secure and robust cybersecurity framework.

Capital Management

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The Company also analyzes the need to raise additional capital in the future, through issuance of debt or equity, to meet its commitments and business needs.

Over the past five years, the Company has implemented or announced two stock

repurchase programs.

During 2025, the Company redeemed in full its preferred stock for $55.5 million and issued $185.0 million of subordinated notes in October 2025 at an initial rate of 6.375% and stated maturity of November 15, 2035.

The proceeds were primarily used to redeem the Company’s subordinated notes due May 15, 2030, with a principal amount of $125.0 million, in November 2025.

Further, in December 2025, the Bank executed a credit risk transfer consisting of a credit default swap related to a $1.52 billion pool of on-balance sheet residential mortgage loans, as the buyer of credit protection, to optimize regulatory capital levels and reduce credit risk.

Over the past five years, the Company has implemented or announced two stock repurchase programs.

On June 25, 2021, the Company announced the authorization to repurchase up to an additional 5% of the Company’s outstanding common stock, or 3.0 million shares.

For the year ended December 31, 2024, the Company repurchased 1,383,238 shares of its common stock under this repurchase program to strategically build capital.

On July 16, 2025, the Company announced its Board authorized a 2025 Stock Repurchase Program to repurchase up to an additional 3.0 million shares.

For the year ended December 31, 2025, the Company repurchased 1,433,537 shares of its common stock.

Of these repurchased shares, 108,621 shares were repurchased outside of the Company’s stock repurchase program.

The Company repurchased these shares from employees that elected to sell shares to cover their withholding tax obligations on vested stock awards and options.

At December 31, 2025, the Company remains authorized to repurchase 3,226,284 shares and will prudently evaluate repurchase opportunities while maintaining existing capital levels.

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Deposits 10,964,405 10,066,342 10,434,949

Federal Home Loan Bank ("FHLB") advances 1,072,611 848,636 1,211,166

FHLB advances

1,397,179 1,072,611 848,636

Securities sold under agreements to repurchase and other borrowings 309,667 258,113 269,604

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Provision for credit losses 16,171 7,689 17,678

Spring Garden opening provision for credit losses 1,426 — —

Net interest income after provision for credit losses 344,052 326,346 352,053

Other income (excluding activity related to debt and equity investments and sale of trust business) 43,362 38,053 49,409

Net gain on equity investments 4,225 876 9,685

Net gain on sale of trust business 2,600 — —

Net loss on sale of investments — (5,305) —

Operating expenses (excluding Federal Deposit Insurance Corporation (“FDIC”) special assessment, merger related and net branch consolidation expense)

Other income 44,701 50,187 33,624

Operating expenses

296,237 245,877 248,912

FDIC special assessment 418 1,663 —

Branch consolidation expense, net — 70 713

Merger related expenses 1,779 22 2,735

Income before provision for income taxes 92,516 130,656 136,765

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Wealth Management (dollars in thousands):

Wealth assets under administration and management (“AUA/M”) (11)

$ 142,030 $ 147,956 $ 335,769

Nest Egg AUA/M

485,606 431,434 401,420

Per Share Data:

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(1) With the exception of end of year ratios, all ratios are based on average daily balances.

(2) Performance ratios for 2024 included a net benefit related to Spring Garden Capital Group, LLC (“Spring Garden”) opening provision for credit losses, a net gain on equity investments, a net gain on sale of trust business, FDIC special assessment and merger related expenses of $3.2 million, or $2.5 million, net of tax expense.

(2) Performance ratios for 2025 included a net expense related to net gain on equity investments, restructuring charges, loss on redemption of preferred stock, credit risk transfer execution expense, FDIC special assessment release and merger related expenses of $15.9 million, or $12.9 million, net of tax benefit.

Performance ratios for 2024 included a net benefit related to Spring Garden opening provision for credit losses, a net gain on equity investments, a net gain on sale of trust business, FDIC special assessment and merger related expenses of $3.2 million, or $2.5 million, net of tax expense.

Performance ratios for 2023 included a net expense related to merger related expenses, net branch consolidation expense, FDIC special assessment, net loss on sale of investments and net gain on equity investments of $6.2 million, or $4.7 million, net of tax benefit.

Performance ratios for 2022 included a net benefit related to merger related expenses, net branch consolidation expense, and gain on equity investments of $6.2 million, or $4.6 million, net of tax expense.

(3) Ratios for each period are based on net income available to common stockholders.

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(10) Loans acquired from acquisitions were recorded at fair value.

The net unamortized credit and purchased with credit deterioration (“PCD”) marks on these loans, not reflected in the allowance for loan credit losses, was $6.0 million, $7.5 million, and $11.4 million at December 31, 2024, 2023, and 2022, respectively.

The net unamortized credit and PCD marks on these loans, not reflected in the allowance for loan credit losses, was $4.0 million, $6.0 million, and $7.5 million at December 31, 2025, 2024, and 2023, respectively.

(11) During 2024, the Company sold a portion of its trust business resulting in gain on sale of $2.6 million.

Highlights of the Company’s financial results for the year ended December 31, 2025 as compared to December 31, 2024 were as follows:

Total assets decreased by $117.0 million to $13.42 billion, from $13.54 billion, primarily due to decreases in loans and securities.

Total loans decreased by $76.5 million to $10.12 billion, from $10.19 billion, primarily due to a decrease in the total commercial portfolio of $126.6 million driven by loan payoffs, partly offset by an increase in residential loans of $70.2 million.

Debt securities held-to-maturity decreased by $113.9 million to $1.05 billion, from $1.16 billion, primarily due to principal repayments.

Debt securities available-for-sale increased by $73.6 million to $827.5 million, from $753.9 million, primarily due to new purchases.

Total liabilities decreased by $157.8 million to $11.72 billion, from $11.88 billion, primarily related to lower deposits and a funding mix shift.

Total deposits decreased by $368.6 million to $10.07 billion from $10.43 billion, partially offset by an increase in FHLB advances of $224.0 million to $1.07 billion from $848.6 million, as a result of lower-cost funding availability.

Net income available to common stockholders was $96.0 million, or $1.65 per diluted share, as compared to $100.0 million, or $1.70 per diluted share.

Net income available to common stockholders for the year ended December 31, 2024 included an opening provision for credit losses related to the acquisition of Spring Garden of $1.4 million, net gain on equity investments of $4.2 million, net gain on sale of trust business of $2.6 million, merger related expenses of $1.8 million, and a special assessment charge of $418,000 related to the FDIC’s final rule to recover the loss on the Deposit Insurance Fund (“DIF”).

These items increased net income in the current year by $2.5 million, net of tax, and diluted earnings per share by $0.05.

Net income available to common stockholders for the year ended December 31, 2023 included net loss on sale of investments of $5.3 million, net gain on equity investments of $876,000, a special assessment charge of $1.7 million related to the FDIC’s final rule to recover the loss on the DIF, net branch consolidation expenses of $70,000, and merger related expenses of $22,000.

These items decreased net income in the current year by $4.7 million, net of tax, and diluted earnings per share by $0.08.

The Company's common equity tier 1 capital ratio increased to 11.17%.

Total assets increased by $1.14 billion to $14.56 billion, from $13.42 billion, primarily due to increases in loans and securities.

Total loans increased by $913.9 million to $11.03 billion, from $10.12 billion, primarily due to an increase of $797.1 million in the total commercial portfolio.

Debt securities available-for-sale increased by $404.3 million to $1.23 billion, from $827.5 million, primarily due to new purchases.

Debt securities held-to-maturity decreased by $164.3 million to $881.6 million, from $1.05 billion, primarily due to principal repayments.

Total liabilities increased by $1.18 billion to $12.90 billion, from $11.72 billion primarily related to an increase in deposits and FHLB advances.

Deposits increased by $898.1 million to $10.96 billion, from $10.07 billion, primarily due to increases in time deposits of $387.9 million and interest bearing deposits of $353.9 million.

FHLB advances increased by $324.6 million to $1.40 billion, from $1.07 billion as a result of lower-cost funding availability.

Net income available to common stockholders decreased to $67.1 million, or $1.17 per diluted share, as compared to $96.0 million, or $1.65 per diluted share.

Net income available to common stockholders for the year ended December 31, 2025 included a net gain on equity investments of $916,000, restructuring charges of $11.5 million, merger related expenses of $4.3 million, credit risk transfer execution expense of $1.3 million, a $210,000 release of FDIC special assessment fees, and a net loss on redemption of preferred stock of $1.8 million.

These items decreased net income in the current year by $14.8 million, net of tax.

The above items decreased diluted earnings per share by $0.26.

These items increased net income in the prior year by $2.5 million, net of tax, and diluted earnings per share by $0.05.

The Company's common equity tier 1 capital ratio was 10.72% at December 31, 2025.

Additionally, the Company remains well-capitalized with a stockholders’ equity to total assets ratio of 11.42% at December 31, 2025.

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The following table sets forth certain information relating to the Company for each of the years ended December 31, 2025, 2024 and 2023.

The yields and costs are derived by dividing the income or expense by the average balance of assets or liabilities, respectively, for the periods shown except where noted otherwise.

The yields and costs, which are annualized, are derived by dividing the income or expense by the average balance of the related assets or liabilities, respectively, for the periods shown except where noted otherwise.

Average balances are derived from average daily balances.

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Residential real estate 3,126,076 129,193 4.13 2,998,732 117,747 3.93 2,911,246 105,796 3.63

Home equity loans and line and other consumer (“other consumer”) 243,360 16,518 6.79 255,359 15,610 6.11 256,912 11,910 4.64

Other consumer

220,942 14,055 6.36 243,360 16,518 6.79 255,359 15,610 6.11

Allowance for loan credit losses, net of deferred loan costs and fees (64,796) — — (59,289) — — (53,477) — —

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123.61 % 123.61 % 126.00 %

(1) Amounts represent debt and equity securities, including FHLB and Federal Reserve Bank (“FRB”) stock, and are recorded at average amortized cost, net of allowance for securities credit losses.

(1) Amounts represent debt and equity securities, including FHLB and FRB stock, and are recorded at average amortized cost, net of allowance for securities credit losses.

(2) Amount is net of deferred loan costs and fees, undisbursed loan funds, discounts and premiums and allowance for loan credit losses, and includes loans held-for-sale and non-performing loans.

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Other consumer

(1,465) (998) (2,463) (758) 1,666 908

Loans receivable, net (2)

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FHLB advances

11,588 (2,277) 9,311 (9,698) (616) (10,314)

Securities sold under agreements to repurchase with customers (296) 114 (182) (22) 984 962

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Comparison of Financial Condition at December 31, 2025 and December 31, 2024

Total assets decreased by $117.0 million to $13.42 billion, from $13.54 billion, primarily due to decreases in loans and securities.

The loan pipeline increased by $123.6 million to $306.7 million, from $183.0 million.

Loan originations increased $290.7 million to $515.2 million, from $224.5 million, primarily in commercial and residential loans.

For more information on the composition of the loan portfolio, see “Lending Activities.” Debt securities held-to-maturity decreased by $113.9 million to $1.05 billion, from $1.16 billion, primarily due to principal repayments.

Debt securities available-for-sale increased by $73.6 million to $827.5 million, from $753.9 million, primarily due to new purchases.

Goodwill increased by $17.2 million to $523.3 million, from $506.1 million due to the acquisition of Spring Garden.

Total liabilities decreased by $157.8 million to $11.72 billion, from $11.88 billion primarily related to lower deposits and a funding mix shift.

Deposits decreased by $368.6 million to $10.07 billion, from $10.43 billion, primarily due to decreases in time deposits of $364.5 million and high-yield savings accounts of $332.4 million, offset by increases in money market accounts of $279.4 million.

Time deposits decreased by $364.5 million to $2.08 billion, from $2.45 billion, representing 20.7% and 23.4% of total deposits, respectively, primarily related to planned runoff of brokered time deposits, which decreased by $556.8 million, offset by increases in retail time deposits of $203.5 million.

Total assets increased by $1.14 billion to $14.56 billion, from $13.42 billion, primarily due to increases in loans and, to a lesser extent, securities.

Total loans increased by $913.9 million to $11.03 billion, from $10.12 billion, primarily due to an increase of $797.1 million in the total commercial portfolio.

The loan pipeline increased by $167.4 million to $474.1 million, from $306.7 million, primarily due to an increase in the commercial loan pipeline of $267.1 million.

Debt securities available-for-sale increased by $404.3 million to $1.23 billion, from $827.5 million, primarily due to new purchases.

Debt securities held-to-maturity decreased by $164.3 million to $881.6 million, from $1.05 billion, primarily due to principal repayments.

Other assets decreased by $36.4 million to $149.3 million, from $185.7 million, primarily due to a decrease in market values associated with customer interest rate swap programs.

Total liabilities increased by $1.18 billion to $12.90 billion, from $11.72 billion primarily related to an increase in deposits and, to a lesser extent, FHLB advances.

Deposits increased by $898.1 million to $10.96 billion, from $10.07 billion, primarily due to increases in time deposits of $387.9 million and interest bearing deposits of $353.9 million.

Time deposits increased by $387.9 million to $2.47 billion, from $2.08 billion, representing 22.5% and 20.7% of total deposits, respectively.

Time deposits included an increase in brokered time deposits of $535.1 million, partly offset by a decrease in retail time deposits of $149.0 million.

The loans-to-deposit ratio was 100.6%, as compared to 100.5%.

FHLB advances increased by $224.0 million to $1.07 billion, from $848.6 million as a result of lower-cost funding availability.

Capital levels remain strong and in excess of “well-capitalized” regulatory levels at December 31, 2024, including the Company’s common equity tier one capital ratio, which increased to 11.17%, up approximately 30 basis points from December 31, 2023.

Total stockholders’ equity increased to $1.70 billion, as compared to $1.66 billion, primarily reflecting net income, partially offset by capital returns comprising of dividends and share repurchases.

For the year ended December 31, 2024, the Company repurchased 1,383,238 shares totaling $21.5 million at a weighted average cost of $15.38.

The Company had 1,551,200 shares available for repurchase under the authorized repurchase program at December 31, 2024.

Additionally, accumulated other comprehensive loss decreased by $5.0 million primarily due to increases in fair market value of available-for-sale debt securities, net of tax.

The Company’s stockholders’ equity to assets ratio was 12.69%, as compared to 12.28% and book value per common share increased to $29.08, as compared to $27.96.

FHLB advances increased by $324.6 million to $1.40 billion, from $1.07 billion as a result of lower-cost funding availability.

Other borrowings increased by $57.7 million to $255.2 million, from $197.5 million primarily due to the issuance of $185.0 million in subordinated notes in October 2025 at an initial rate of 6.375% and stated maturity of November 15, 2035.

The proceeds were primarily used to redeem the Company’s subordinated notes due May 15, 2030, with principal amount of $125.0 million, in November 2025.

Other liabilities decreased by $89.1 million to $209.3 million, from $298.4 million, mostly due to a decrease in the market values of derivatives associated with customer interest rate swaps and related collateral received from counterparties.

Capital levels remain strong and in excess of “well-capitalized” regulatory levels at December 31, 2025, including the Company’s common equity tier one capital ratio of 10.72%.

For the year ended December 31, 2025, the ratio was primarily impacted by loan growth, increased lending commitments and share repurchases, partly offset by execution of the credit risk transfer entered into in December 2025.

Total stockholders’ equity decreased to $1.66 billion, as compared to $1.70 billion, primarily due to the redemption of preferred stock for $55.5 million and capital returns comprised of dividends and share repurchases, partially offset by net income.

Additionally, accumulated other comprehensive loss decreased by $13.7 million primarily due to increases in the fair market value of available-for-sale debt securities, net of tax.

Noncontrolling interest decreased by $1.1 million due to the disposition of the title business.

During the year ended December 31, 2025, the Company repurchased 1,433,537 shares totaling $24.9 million at a weighted average cost of $17.21, which includes repurchases of exercised options and awards from employees outside of the share repurchase program.

On July 16, 2025, the Company announced its Board of Directors authorized a 2025 Stock Repurchase Program to repurchase up to an additional 3.0 million shares.

As of December 31, 2025, the Company had 3,226,284 shares available for repurchase under the authorized repurchase programs.

The Company’s stockholders’ equity to assets ratio was 11.42%, as compared to 12.69% and book value per common share decreased to $28.97, as compared to $29.08.

Comparison of Operating Results for the Years Ended December 31, 2025 and December 31, 2024

Net income available to common stockholders decreased to $67.1 million, or $1.17 per diluted share, as compared to $96.0 million, or $1.65 per diluted share.

Net income available to common stockholders for the year ended December 31, 2024 included the Spring Garden opening provision for credit losses of $1.4 million, net gain on equity investments of $4.2 million, a net gain on sale of a portion of its trust business of $2.6 million, a special FDIC assessment of $418,000 and merger related expenses of $1.8 million.

These items increased net income in the current year by $2.5 million, net of tax.

Net income for the year ended December 31, 2023 included a net gain on equity investments of $876,000, net loss on sale of investments of $5.3 million, a special FDIC assessment of $1.7 million, net branch consolidation expenses of $70,000, and merger related expenses of $22,000.

These items decreased net income for the prior year by $4.7 million, net of tax.

Net income available to common stockholders for the year ended December 31, 2025 included a net gain on equity investments of $916,000, restructuring charges of $11.5 million, merger related expenses of $4.3 million, credit risk transfer execution expense of $1.3 million, a $210,000 FDIC special assessment release, and a net loss on redemption of preferred stock of $1.8 million.

These items decreased net income in the current year by $14.8 million, net of tax.

The above items decreased diluted earnings per share by $0.26.

Net income for the year ended December 31, 2024 included the Spring Garden opening provision for credit losses of $1.4 million, net gain on equity investments of $4.2 million, a net gain on sale of a portion of its trust business of $2.6 million, a FDIC special assessment fees of $418,000 and merger related expenses of $1.8 million.

These items increased net income for the prior year by $2.5 million, net of tax.

Interest Income

Interest income increased to $642.2 million, from $608.0 million.

The yield on average interest-earning assets increased to 5.23%, from 4.96%, due to the impact of the rate environment.

The average balance of interest-earning assets increased by $29.8 million, primarily driven by redeployment of cash into securities, which grew by $179.0 million.

Interest income remained relatively stable at $642.5 million, from $642.2 million.

The yield on average interest-earning assets decreased to 5.17%, from 5.23%, while the average balance of interest-earning assets increased by $149.1 million.

This was primarily driven by an increase in commercial and residential loans.

Interest Expense

Interest expense increased to $308.1 million, from $238.2 million, reflecting an increase in the cost of deposits.

The cost of average interest-bearing liabilities increased to 3.10%, from 2.45%, primarily due to higher cost of deposits.

The total cost of deposits (including non-interest bearing deposits) increased to 2.36%, from 1.68%.

Interest expense decreased to $282.2 million, from $308.1 million, and the cost of average interest-bearing liabilities decreased to 2.81%, from 3.10%.

This was primarily due to lower total cost of deposits, which decreased to 2.08%, from 2.36%.

Average interest-bearing liabilities increased by $120.5 million, primarily due to an increase in total deposits.

Net Interest Income and Margin

Net interest income decreased to $334.0 million, from $369.7 million, reflecting the net impact of the interest rate environment.

The net interest margin decreased to 2.72%, from 3.02%, primarily due to the increase in cost of funds outpacing the increase in yield on average interest-earning assets.

Net interest income increased to $360.2 million, from $334.0 million.

Net interest margin increased to 2.90%, from 2.72%, primarily due to the decrease in cost of funds outpacing the decrease in yield on average interest-earning assets.

Provision for Credit Losses

Provision for credit losses was $16.2 million, as compared to $7.7 million.

Current year included a $1.4 million initial provision for credit losses related to the acquisition of Spring Garden.

The remaining provision was driven by net change in downside macro-economic forecasts utilized in the estimate, partly offset by a decrease in criticized and classified assets.

Prior year included the impact of a single commercial relationship that had a $8.4 million partial charge-off, and to a lesser extent, the net effect of credit rating migrations.

The prior year included a $1.4 million initial provision for credit losses related to the acquisition of Spring Garden.

The current year provision was primarily driven by net loan growth, an increase in unfunded loan balances and commitments, and elevated macroeconomic uncertainty, partly offset by overall improvements in criticized and classified loans.

Net loan charge-offs were $5.4 million for the current year, as compared to $1.6 million in the prior year.

The current year and prior year included partial charge-offs of $1.6 million and $8.4 million, respectively, for a single commercial real estate relationship noted above, which was resolved through the sale of the underlying collateral in the current year.

The current year included charge-offs of $2.5 million for four commercial relationships related to the Spring Garden acquisition, and charge-offs of $1.5 million related to sales of non-performing residential and consumer loans during the year.

The prior year includes the impact of a $1.6 million charge-off related to a single commercial real estate relationship that was sold in the prior year.

Non-interest Income

Other income increased to $50.2 million, from $33.6 million.

Other income for the year ended December 31, 2024 was favorably impacted by net gains on equity investments of $4.2 million and a net gain on sale of a portion of its trust business of $2.6 million.

The prior year was adversely impacted by net losses on investments of $4.4 million, which included $5.3 million of losses related to the sale of investments.

The remaining increase of $5.3 million, was primarily driven by increases in the cash surrender value of bank owned life insurance of $2.6 million, which included one-time death benefits of $1.3 million in the current year, net gain on sale of loans of $1.9 million, and a non-recurring gain on sale of assets held for sale of $855,000.

This was partially offset by a decrease in trust and asset management revenue of $784,000, related to the sale of a portion of the Company’s trust business.

Other income decreased to $44.7 million, as compared to $50.2 million.

Other income for the year ended December 31, 2025 was favorably impacted by net gains on equity investments of $916,000.

The prior year was favorably impacted by net gains on equity investments of $4.2 million and a net gain on sale of a portion of its trust business of $2.6 million.

The remaining increase of $423,000 was primarily driven by increases in commercial loan swap income of $2.8 million due to new swaps, net gain on sale of loans of $1.3 million, and non-recurring other income of $1.9 million in the current year.

These were partly offset by decreases in fees and service charges of $3.9 million related to lower title fees and a decrease of $855,000 related to a non-recurring gain on sale of assets in the prior year.

Non-interest Expense

Operating expenses decreased to $245.9 million, from $248.9 million.

Operating expenses for the year ended December 31, 2024 were adversely impacted by $1.8 million for merger related expenses and $418,000 for FDIC special assessment in the current year.

The prior year was adversely impacted by an FDIC special assessment of $1.7 million, and $92,000 for merger related and net branch consolidation expenses in the prior year.

The remaining decrease of $3.5 million, was due to decrease in professional fees of $8.8 million as the Company realized benefits from the performance improvement initiatives and investments made in the prior the year.

This was partially offset by increases in other operating expense of $3.0 million, which was partly due to additional loan servicing expenses, and compensation and benefits of $2.5 million, primarily due to the acquisitions during the year.

Operating expenses increased to $296.2 million, as compared to $245.9 million.

Operating expenses for the year ended December 31, 2025 were adversely impacted by $11.5 million of restructuring expenses, $4.3 million of merger related expenses, and $1.3 million of credit risk transfer execution expense, partly offset by a $210,000 release of FDIC special assessment fees.

The prior year was adversely impacted by $1.8 million of merger related expenses and $418,000 of FDIC special assessment fees.

The remaining increase of $35.7 million, was primary driven by an increase in compensation and benefits expense of $21.0 million related to acquisitions at the end of the prior year and the addition of commercial banking teams during the current year.

Additional drivers were increases in professional fees of $4.3 million, partly related to Premier Banking recruitment fees, data processing expense of $3.4 million, other operating expenses of $3.3 million, primarily related to loan servicing expenses, occupancy expense of $2.1 million, partly due to additional space for commercial banking teams, and federal deposit insurance and regulatory assessments of $1.3 million.

Income Tax Expense

The provision for income taxes was $21.5 million, as compared to $30.3 million.

The effective tax rate was 23.2%, as compared to 23.9%.

The current year’s effective tax rate was adversely impacted by a non-recurring write-off of a deferred tax asset of $1.2 million net of other state effects and credits as compared to the prior year period.

The effective tax rate was 23.2% for both years.

The current year’s effective tax rate was adversely impacted by non-deductible merger expenses.

The prior year’s effective tax rate was adversely impacted by a non-recurring write-off of a deferred tax asset of $1.2 million net of other state effects and credits.

Comparison of Operating Results for the Years Ended December 31, 2024 and December 31, 2023

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The policy includes internal limits, monitoring of key indicators, deposit concentrations, liquidity sources and availability, stress testing, collateral management, and other qualitative and quantitative metrics.

Management monitors cash daily to determine the liquidity needs of the Bank and OceanFirst Financial Corp.

Management monitors cash on a daily basis to determine the liquidity needs of the Bank and OceanFirst Financial Corp.

(the “Parent Company”), a separate legal entity from the Bank.

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As of December 31, 2025, total on-balance sheet liquidity and funding capacity was $3.8 billion.

The Company has a highly operational and granular deposit base, with long-standing client relationships across multiple customer segments providing stable funding.

The vast majority of the government deposits are protected by the FDIC insurance as well as the State of New Jersey under the Government Unit Deposit Protection Act, which requires uninsured government deposits to be further collateralized by the Bank.

At December 31, 2024, the Bank reported in its Call Report $5.75 billion of total uninsured deposits.

The Bank has a highly operational and granular deposit base, with long-standing client relationships across multiple customer segments providing stable funding.

The vast majority of government deposits are protected by FDIC insurance as well as the State of New Jersey under the Government Unit Deposit Protection Act, which requires uninsured government deposits to be further collateralized by the Bank.

At December 31, 2025, the Bank reported $6.46 billion of estimated uninsured deposits in its Call Report.

This total included $2.71 billion of collateralized government deposits and $1.90 billion of intercompany deposits of fully consolidated subsidiaries, leaving estimated adjusted uninsured deposits of $1.85 billion, or 16.8% of total deposits.

On balance-sheet liquidity and funding capacity represented 206% of the estimated adjusted uninsured deposits.

The primary sources of liquidity specifically available to the Parent Company are dividends from the Bank, proceeds from sale of investments, and the issuance of debt, preferred and common stock.

The primary sources of liquidity specifically available to the Parent Company are dividends from the Bank, proceeds from the sale of investments, and the issuance of debt and common stock.

For the year ended December 31, 2025, the Parent Company received dividend payments of $62.4 million from the Bank.

At December 31, 2025, the Parent Company held $87.9 million in cash and cash equivalents.

The Bank’s primary sources of funds are deposits, principal and interest payments on loans and investments, FHLB advances, and other borrowings .

The Bank’s primary sources of funds are deposits, principal and interest payments on loans and investments, FHLB advances, other borrowings and proceeds from the sale of loans and investments .

While scheduled payments on loans and securities are predictable sources of funds, deposit flows, loan prepayments, and loan and investment sales are greatly influenced by interest rates, economic conditions, and competition.

The Bank has other sources of liquidity if a need for additional funds arises, including lines of credit at multiple financial institutions and access to the FRB Discount Window.

As of December 31, 2024, the Company pledged $7.43 billion of loans with the FHLB and FRB to enhance the Company’s borrowing capacity, which included collateral pledged to the FHLB to obtain a municipal letter of credit to collateralize certain municipal deposits.

As of December 31, 2025, the Company pledged $7.92 billion of loans with the FHLB and FRB to enhance the Company’s borrowing capacity, which included collateral pledged to the FHLB to obtain a letter of credit to collateralize certain municipal deposits.

The Company also pledged $1.45 billion of securities to secure borrowings, enhance borrowing capacity, collateralize its repurchase agreements, and for other purposes required by law.

The Company had $1.07 billion of FHLB advances as compared to $848.6 million at December 31, 2023.

The Company had no outstanding overnight borrowings from the FHLB as of December 31, 2024 and 2023.

The Company had $1.40 billion of FHLB advances, including $929.2 million of outstanding FHLB term advances and $468.0 million of overnight borrowings as of December 31, 2025, as compared to $1.07 billion of FHLB term advances and no outstanding overnight borrowings from the FHLB at December 31, 2024.

The Company issued $185.0 million of subordinated notes in October 2025 at an initial rate of 6.375% and stated maturity of November 15, 2035.

The proceeds were primarily used to redeem the Company’s subordinated notes due May 15, 2030, with principal amount of $125.0 million, in November 2025.

The Company’s cash needs for the year ended December 31, 2025 were primarily satisfied by increased deposits, net proceeds from FHLB advances, and principal repayments of securities, and primarily utilized to fund loan growth and to purchase debt securities.

The Company’s cash needs for the year ended December 31, 2024 were primarily satisfied by FHLB advances and principal and interest payments on loans and securities and primarily utilized for the reduction of deposits.

The Company’s cash needs for the year ended December 31, 2023 were primarily satisfied by the increase in deposits.

The cash was invested in debt securities, and utilized for the reduction of FHLB advances and loan originations.

Off-Balance Sheet Commitments and Contractual Obligations

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If these deposits do not remain with the Company, it may need to seek other sources of funds, including other deposit products, advances from the Federal Home Loan Bank of New York and other borrowing sources.

Depending on market conditions, the Company may pay higher rates on such deposits or other borrowings than it currently pays on the certificates of deposit due on or after December 31, 2024.

The Company believes, however, based on past experience that a significant portion of such deposits will remain with us.

The Company has the ability to attract and retain deposits by adjusting the interest rates offered.

Depending on market conditions, the Company may be required to pay higher rates on such deposits or borrowings than it currently pays.

Liquidity Used in Stock Repurchases and Cash Dividends

Under the Company’s stock repurchase program, shares of OceanFirst Financial Corp.

common stock may be purchased in the open market and through other privately negotiated transactions, from time-to-time, depending on market conditions.

Under the Company’s stock repurchase program, shares of its common stock may be purchased in the open market and through other privately negotiated transactions, from time-to-time, depending on market conditions.

The repurchased shares are held as treasury stock for general corporate purposes.

For the year ended December 31, 2025, the Company repurchased 1,433,537 shares of its common stock totaling $24.9 million.

Of these repurchased shares for the year ended December 31, 2025, 108,621 shares were repurchased outside of the Company’s stock repurchase program.

The Company repurchased these shares from employees that elected to sell shares to cover their withholding tax obligations on vested stock awards and options.

On July 16, 2025, the Company announced its Board authorized a 2025 Stock Repurchase Program to repurchase up to an additional 3.0 million shares.

At December 31, 2025, there were 3,226,284 shares available to be repurchased under the authorized stock repurchase program.

Cash dividends on common stock declared and paid during the year ended December 31, 2025 were $46.2 million, as compared to $46.9 million for the prior year.

Cash dividends on preferred stock declared and paid during the years ended December 31, 2024 and 2023 were $4.0 million for both periods.

The Company’s ability to continue to repurchase shares of common stock and pay dividends remains dependent upon capital distributions from the Bank, which may be adversely affected by capital restraints imposed by applicable regulations.

If applicable regulations or regulatory bodies prevent the Bank from paying a dividend to the Company, the Company may not have the liquidity necessary to repurchase shares of common stock or pay a dividend in the future or pay a dividend at the same rate as historically paid or be able to meet current debt obligations.

Additionally, regulations of the Federal Reserve may prevent the Company from either paying or increasing the cash dividend to common stockholders.

Cash dividends on preferred stock declared and paid during the years ended December 31, 2025 were $2.0 million, as compared to $4.0 million for the prior year.

On May 15, 2025, the Company redeemed all 57,370 shares of its 7.00% Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series A.

The aggregate payment of $57.4 million, at a redemption price of $25.00 per share, resulted in a net loss on redemption of $1.8 million.

The Parent Company’s ability to continue to repurchase shares of common stock and pay dividends depends on capital distributions from the Bank, which may be adversely affected by capital restraints imposed by applicable regulations.

If applicable regulations or regulators prevent the Bank from paying a dividend to the Parent Company, the Parent Company may not have the liquidity necessary to repurchase shares of common stock or pay a dividend in the future or pay a dividend at the same rate as historically paid or be able to meet current debt obligations.

Additionally, regulations of the Federal Reserve may prevent the Parent Company from either paying or increasing the cash dividend to common stockholders.

These regulatory policies may affect the ability of the Parent Company to pay dividends, repurchase shares of common stock, or otherwise engage in capital distributions.

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The Company manages its capital sources, uses, and expected future needs through its Treasury function and the Asset Liability Committee.

The Company has an internal policy that addresses capital and management monitors the adherence to policy limits to satisfy current and future capital needs.

The Company has an internal policy that addresses capital and management monitors the adherence to policy limits

to satisfy current and future capital needs.

The policy includes internal limits, monitoring of key indicators, sources and availability, intercompany transactions, forecasts and stress testing, and other qualitative and quantitative metrics.

Additionally, management performs multiple capital stress test scenarios on a quarterly basis, varying loan growth, earnings, access to the capital markets, credit losses, and mark-to-market losses in the investment portfolio, including both available-for-sale and held-to-maturity.

As of December 31, 2024, the Bank and Parent Company continued to maintain adequate capital under all stress scenarios, including a scenario where all losses related to the investment securities portfolio are realized.

Management performs multiple capital stress test scenarios on a quarterly basis, varying loan growth, earnings, access to the capital markets, credit losses, and mark-to-market losses in the investment portfolio, including both available-for-sale and held-to-maturity.

As of December 31, 2025, the Bank and Company continued to maintain adequate capital under all stress scenarios.

The Bank and the Parent Company also have detailed contingency capital plans and obtain comprehensive reporting of capital trends on a regular basis, which are reviewed by management and the Board.

In December 2025, the Company executed a credit risk transfer consisting of a credit default swap related to a $1.52 billion pool of on-balance sheet residential mortgage loans, as the buyer of credit protection, to manage regulatory capital levels and reduce credit risk.

This transaction reduced the risk-weighted assets for this pool of loans for regulatory capital purposes.

The Company and the Bank satisfied the criteria to be “well-capitalized” under the Prompt Corrective Action Regulations.

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The use of different judgments, assumptions, and estimates could result in material differences in the results of operations or financial condition.

The critical accounting policy and its application is reviewed periodically, and at least annually, with the Audit Committee of the Board of Directors.

Allowance for credit losses in accordance with Accounting Standards Update (“ASU”) 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326), was a critical accounting policy in the preparation of the consolidated financial statements as of and for the period ended December 31, 2024.

The critical accounting policy and its application is reviewed periodically, and at least annually, with the Audit Committee of the Board.

Allowance for credit losses in accordance with ASU 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326), was a critical accounting policy in the preparation of the consolidated financial statements as of and for the period ended December 31, 2025.

Goodwill in accordance with ASC 350, Intangibles - Goodwill and Other, was a critical accounting estimate in the preparation of the consolidated financial statements as of and for the period ended December 31, 2025.

Allowance for Credit Losses (“ACL”)

Allowance for Credit Losses

The Company’s methodology to measure the ACL incorporates both quantitative and qualitative information to assess lifetime

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Prepayment and forward interest rate projections are also assumptions used in the quantitative model subject to estimation.

These assumptions are consistent with the assumptions evaluated in the Company’s Interest Rate Risk (“IRR”) model.

Changes in these assumptions have varying implications to the ACL measurement.

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Since 2022, the Company incorporated unique factors to address macro-economic uncertainty and alternative economic forecast projections.

Although management believes that it uses the best information available to establish the ACL in conformity with generally accepted accounting principles (“GAAP”), future adjustments to the ACL may be necessary and results of operations could be adversely affected if circumstances differ substantially from the assumptions used in making the determinations.

For example, at December 31, 2024, if the Company had elected a scenario using more favorable credit trends in the qualitative input in its commercial portfolio, the ACL measurement would have been approximately $1.9 million lower.

Although management believes that it uses the best information available to establish the ACL in conformity with GAAP, future adjustments to the ACL may be necessary and results of operations could be adversely affected if circumstances differ substantially from the assumptions used in making the determinations.

For example, at December 31, 2025, if the Company had elected a scenario using one level more favorable credit trends in the qualitative input in its commercial portfolio, the ACL measurement would have been approximately $2.7 million lower.

Alternatively, if the Company had elected a more adverse scenario for its macro-economic forecasts, the ACL measurement would have been approximately $11.5 million higher.

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If the results of the qualitative assessment indicate that it is not more likely than not that an impairment has occurred, or if the quantitative impairment test results in a fair value of the Company that is greater than the carrying amount, then no impairment charge is recorded.

As of the annual impairment testing date of August 31, 2024, the Company bypassed the qualitative assessment and proceeded directly to the quantitative impairment test based on the stock price of the Company on the measurement date and economic uncertainty.

The Company completed its annual goodwill impairment test as of August 31, 2025.

For the annual test, the Company bypassed the qualitative assessment and proceeded directly to the quantitative impairment test based on the stock price of the Company on the measurement date and economic uncertainty.

To perform the quantitative assessment, the Company engaged a third-party service provider to assist management with the determination of the fair value of the Company.

The Company estimated fair value of equity using the market capitalization method of the market approach, consideration of initiatives unknown by the market and evaluation of any implied control premium.

Management further supported the conclusions by assessing a combination of an income valuation methodology, comprising a discounted cash flow analysis and market valuation methodologies, comprising the guideline public company and guideline merged and acquired company methods.

The Company estimated the fair value of equity using the market capitalization method of the market approach, consideration of initiatives unknown by the market and evaluation of any implied control premium.

The market capitalization method calculated the aggregate market value of the Company based on the total number of outstanding shares of common and preferred stock and the market prices of the shares as of the assessment date.

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The implied control premium was supported using a discounted cash flow analysis that contemplated the present value of assumed market participant cost savings and synergies.

The discounted cash flow (“DCF”) estimated the present value of future cash flows.

A DCF analysis requires significant judgment to model financial forecasts, which included loan and deposit growth, income on securities, forward interest rates, fee generation and expense incurrence, industry and economic trends, and other relevant considerations.

The DCF analysis was utilized to estimate the present value of future cash flows.

A DCF analysis requires significant judgment to model financial forecasts, which included forward interest rates, fee generation and expense incurrence, industry and economic trends, and other relevant considerations.

For periods beyond those forecasted, a terminal value was estimated based on an assumed long-term growth rate, which was derived using the Gordon Growth Model.

The discount rate applied to the forecasted cash flows was calculated using a build-up approach, which starts with the risk-free interest rate, which was then calibrated for market and company specific risk premiums, including a beta, equity risk, size, and company-specific risk premiums to reflect risks and uncertainties in the financial market and in the Company’s business projections.

The market approach for guideline public company method utilizes observable market data from comparable public companies, including price-to-tangible book value ratios, to estimate the Company’s fair value.

This approach also incorporates a control premium to represent the Company’s expectation of a hypothetical acquisition.

The market approach for guideline merged and acquired company method utilizes observable transactions of actual prices paid for target companies that operated in comparable industries or markets facing similar risks.

Both methods of the market approach require judgment in the selection of comparable companies or comparable transactions and includes those with similar business activities, and related operating environments.

The results of the quantitative assessment indicated that the fair value of the Company’s reporting unit exceeded its carrying amount, which resulted in no impairment loss at August 31, 2024.

Management continued to carefully assess and evaluate all available information for potential triggering events after the August 31 annual testing date and through December 31, 2024.

Management concluded no triggering events were identified subsequent to the August 31, 2024 annual test date.

Significant negative industry or economic trends, including declines in the market price of the Company’s stock, reduced estimates of future cash flows or business disruptions could result in impairments to goodwill in the future, which would result in recording an impairment loss.

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Management will continue evaluating the economic conditions at future reporting periods for triggering events.

The results of the quantitative assessment indicated that the fair value of the Company’s reporting unit exceeded its carrying amount, which resulted in no impairment loss at August 31, 2025.

Management continued to carefully assess and evaluate all available information for potential triggering events after the August 31 annual testing date and through December 31, 2025.

Management concluded no triggering events were identified subsequent to the August 31, 2025 annual test date.

Impact of New Accounting Pronouncements

Accounting Pronouncements Adopted in 2024

In June 2022, the Financial Accounting Standards Board (“FASB”) issued ASU 2022-03, “Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions”.

The amendments in this ASU clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value.

The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction.

In addition, this update introduces new disclosure requirements to provide information about the contractual sales restriction including the nature and remaining duration of the restriction.

This update is effective for financial statements issued for fiscal years and interim periods beginning after December 15, 2023.

The Company adopted this standard in 2024.

The adoption of this standard did not have a material impact on the Company’s consolidated financial statements.

In March 2023, FASB issued ASU 2023-02, “Investments - Equity Method and Joint Venture (Topic 323):

Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method”.

The amendments in this ASU permit reporting entities to account for the tax equity investments, regardless of the tax credit program from which the income tax credits are received, using the proportional amortization method.

This update is effective for financial statements issued for fiscal years and interim periods beginning after December 15, 2023.

The Company adopted this standard in 2024.

The adoption of this standard did not have a material impact on the Company’s consolidated financial statements.

In November 2023, FASB issued ASU 2023-07, “Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures”.

The amendments in this ASU require improved reportable segment information on an annual and interim basis, primarily through enhanced disclosures about significant segment expenses.

This update will be effective for financial statements issued for fiscal years beginning after December 15, 2023, and interim periods for fiscal years beginning after December 15, 2024.

Early adoption is permitted.

The Company adopted this standard in 2024.

The adoption of this standard did not have a material impact on the Company’s consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

In August 2023, FASB issued ASU 2023-05, “Business Combinations - Joint Venture Formations (Subtopic 805-60):

Recognition and Initial Measurement”.

The amendments in this ASU require that a joint venture, upon formation, apply a new basis of accounting and initially measure assets and liabilities at fair value, with exceptions to fair value measurement that are consistent with the business combinations guidance.

This update will be effective prospectively for all joint venture formations with a formation date on or after January 1, 2025.

Early adoption is permitted.

The Company does not expect this standard to have a material impact on the consolidated financial statements.

In December 2023, FASB issued ASU 2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures”.

The amendments in this ASU require improved annual income tax disclosures surrounding rate reconciliation, income taxes paid, and other disclosures.

This update will be effective for financial statements issued for fiscal years beginning after December 15, 2024.

Early adoption is permitted.

The Company is currently evaluating the impact of this standard on the consolidated financial statements.

In November 2024, FASB issued ASU 2024-03 “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40)”.

The amendments in this ASU require expanded disclosure and disaggregation of certain costs and expenses including, but not limited to, purchases of inventory, employee compensation, depreciation, depletion, and amortization.

This update will be effective for financial statements issued for fiscal years beginning after December 15, 2026, and interim periods for fiscal years beginning after December 15, 2027.

Early adoption is permitted.

The Company is currently evaluating the impact of this standard on the consolidated financial statements.

In November 2024, FASB issued ASU 2024-04, “Debt - Debt with Conversion and Other Options (Subtopic 470-20)”.

The amendments in this ASU clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion.

This update will be effective for financial statements issued for fiscal years beginning after December 15, 2025, and interim periods for fiscal years beginning after December 15, 2026.

Early adoption is permitted.

The Company is currently evaluating the impact of this standard on the consolidated financial statements.

For further information regarding accounting pronouncements, refer to Note 1.

Summary of Significant Accounting Policies in the Notes to the Consolidated Financial Statements.

Impact of Inflation and Changing Prices

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

What changed 10-K

Item 7. Management’s Discussion and Analysis