What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2026-02-26 compared with 2025-02-27 · 153 added, 128 removed, 283 unchanged (50% of the section changed)

18 unchanged sentences

We also provide trust services and products through Oppenheimer Trust Company of Delaware Inc..

and discount brokerage services through Freedom Investments, Inc.

Through OPY Credit Corp., we conduct secondary trading activities related to the purchase and sale of loans and trade claims, primarily on a riskless principal basis.

5 unchanged sentences

We continuously invest in and improve our technology platform to support client service and to remain competitive, while continuously managing expenses.

The Company's long-term growth plan is to continue to expand existing offices by hiring experienced professionals as well as expand through the purchase of operating branch offices from other broker-dealers or the opening of new branch offices in attractive locations, and to continue to grow and develop the existing trading, investment banking, investment advisory and other divisions.

We recognize employee work habits have changed in a post-pandemic world.

1 unchanged sentence

We are committed to continuing to improve our capabilities to ensure compliance with industry regulations, support client service and expand our wealth management and capital markets capabilities.

We recognize the importance of

compliance with applicable regulatory requirements and are committed to performing rigorous and ongoing assessments of our compliance and risk management effort, and investing in people and programs, while providing a platform with first class investment programs and services.

We recognize the importance of compliance with applicable regulatory requirements and are committed to performing rigorous and ongoing

assessments of our compliance and risk management effort, and investing in people and programs, while providing a platform with first class investment programs and services.

The Company also reviews its full service business model to determine the opportunities available to build or acquire closely related businesses in areas where others have shown some success.

4 unchanged sentences

Impact of Change in Short-term Interest Rates

After decreasing the federal funds rate for the first time in nearly 14 months with a 50 bps reduction in September of 2024, the Federal Reserve (the “FED”) enacted two separate 0.25% rate cuts in the fourth quarter of 2024, lowering the target fed funds range to 4.25% - 4.50% – a full percent below its recent peak.

Projections of the federal funds rate released by the FED after its December meeting indicate that they expect two additional rate cuts in 2025, which is reduced from previous forecasts and reflective of the FED’s stated intention of proceeding with a cautious approach dependent on inflation and employment data.

Recent employment figures reflect a stronger economy than earlier projected and may impact future interest rate decisions.

Plans announced by the incoming administration including actions on tariffs and immigration status of undocumented persons may tend to weaken economic activity and could also impact future interest rate decisions.

Potential decreases to the federal funds rate may impact our interest-based revenues.

While decreases in interest rates will lower fees the Company earns from FDIC-insured deposits of clients through a program offered by the Company, such decreases may be offset to a degree if the cash sweep balances increase as clients find fewer higher-yielding alternatives to deploy these balances.

Future rate decreases will also reduce the rates the Company charges on customer margin loans and earns on other interest-sensitive assets, which will have a negative impact on our earnings.

Israel-Hamas War and Conflict with Hezbollah and Iran

After holding rates steady for the first nine months of the year, the Federal Reserve voted in favor of three consecutive 25 basis point rate cuts at its meetings in September, October and December of 2025.

The current target range of 3.50% to 3.75% underscores the Federal Reserve’s emphasis on supporting economic growth and stabilizing the labor market amid somewhat moderating inflationary pressures.

However, dissenting votes at recent meetings suggest that future interest rate policy decisions may be more divided, potentially leading to increased uncertainty around the pace and direction of rate changes.

Further changes to the federal funds rate may continue to impact our interest-based revenues.

Lower rates reduce fees earned from FDIC-insured client deposits through our sweep program, though this impact may be partially offset if the cash sweep balances rise as clients encounter fewer attractive alternatives to deploy these balances.

Rate reductions also decrease the interest we charge on customer margin loans and earn on other interest-sensitive assets, negatively affecting earnings.

The Company may enjoy an offset to such reduced interest revenues by increased activities in other parts of its business as has traditionally been the case.

Additionally, lower rates may also reduce the Company's short-term borrowing costs, which helps reduce interest-related expenses.

On October 7, 2023, Hamas initiated an unprovoked invasion of Israel from the Gaza Strip, resulting in thousands of casualties.

Israel formally declared war on Hamas in response to the attack and initiated several military operations in an effort to clear militants from the area.

The war has now finished its second year and has seen a significant escalation in a longstanding conflict between Israel and Hezbollah, the Lebanese-based militant group.

The conflict was further intensified in 2024 by the direct entry of Iran, which launched a missile attack on Israel.

Despite a recently announced ceasefire, there remains a risk that these conflicts could expand into a wider regional war which could have an adverse impact on the worldwide economy, financial markets and thus on our business.

At this time, these conflicts have not yet had a material impact on our business operations in Israel or elsewhere.

Israel formally declared war on Hamas in response to the attack and initiated several military operations in an effort to clear militants from the area, including hostilities against Hezbollah, Syria and Iran.

In October 2025, Israel and Hamas announced a tentative ceasefire and hostage release agreement, under which Hamas committed to release remaining hostages and Israel agreed to halt military operations.

The ceasefire remains fragile, with reports of violations and humanitarian challenges raising concerns about its durability.

If unrest persists or escalates, there remains a risk that the conflict could broaden into a wider regional war, potentially disrupting global trade, financial markets and thus on our business.

We continue to monitor for any adverse impacts of this conflict on our business operations and financial performance in Israel or elsewhere.

Recent Developments in Venezuela

On January 3, 2026, the United States conducted a military operation in Venezuela that resulted in the capture of President Nicolás Maduro and his wife, who were subsequently transported to New York to face narco‑terrorism and related charges, with legal proceedings beginning in Manhattan federal court.

The administration has also signaled temporary U.S.

oversight of Venezuela’s oil industry and transition.

In addition, the U.S.

Coast Guard in conjunction with the U.S.

military has boarded and taken possession of five vessels carrying sanctioned oil.

While the Company has no direct exposure to Venezuelan assets or counterparties, the heightened geopolitical uncertainty and potential volatility in global energy and emerging markets could influence overall market conditions.

Such developments may affect investor sentiment and trading activity, which in turn could negatively impact performance across our businesses.

Recent Changes in U.S.

Trade Policies

In 2025, the United States significantly increased tariffs across a broad range of imports from almost every major trading partner.

Although some tariffs were temporarily paused during negotiations with China, the EU, and other partners, it is possible that failed negotiations or expiration of tariff pauses could prompt retaliatory levies from impacted countries.

These trade actions are also likely to disrupt supply lines, increase inflation and negatively impact consumer spending in the U.S.

While the recent changes to U.S.

trade policies have not had a significant impact on the Company’s financial results to date, adverse changes or sudden policy announcements, including retaliatory tariffs, could adversely impact the financial markets, reducing the value of our assets under management and related advisory fees.

To date, turmoil created by proposed tariffs, as well as expected lower interest rates and constantly changing U.S.

policy, have substantially and adversely impacted the value of the U.S.

dollar in comparison with other major currencies.

On February 20, 2026, the U.S.

Supreme Court issued a 6–3 decision striking down the administration’s sweeping global tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”), holding that the statute does not provide the President authority to unilaterally impose broad‑based tariffs.

The ruling invalidates the 10% baseline tariff applied to nearly all U.S.

trading partners as well as higher duties on selected countries.

Following the decision, President Trump has stated that he intends to pursue new tariff measures under alternative legal authorities, signaling that additional trade actions may follow despite the Court’s ruling.

Although the Supreme Court did not address whether previously collected tariffs must be refunded, external estimates indicate that IEEPA‑based tariffs generated more than $175 billion in revenue, creating uncertainty regarding potential reimbursement obligations.

Changes or adverse developments to U.S.

trade policies may also depress trading volumes as well as capital market and deal making activities, reducing our related commissions and investment banking revenues.

Uncertainty over the outcome of trade negotiations may also impact activity levels in the capital markets as well as general price levels in the equity and debt markets.

EXECUTIVE SUMMARY

T he firm registered strong results of operations for the year ended 2024 on the back of record high revenue generated by our diverse businesses.

Our reported results were negatively impacted (with full year expense totaling $32.6 million pre-tax) by the increase in our stock price in 2024 and its conversion to expense in certain liability awards previously made to employees, making the recent recognition of our stock by investors, a mixed blessing.

Our results were buoyed by an equities market that had a strong increase in popular averages, as lower interest rates and a strong domestic economy powered the S&P 500 to 57 new record closes and its best consecutive years in over two decades.

Equity markets were led by significant increases in the performance of the “Magnificent Seven,” propelled by the expectation of the impact of A.I.

on the economy in future years.

Most economic indicators currently suggest that the economy is well on its way to achieving a “soft landing” as we move further into 2025.

The continued rise of the markets drove the outstanding results shown in our Wealth Management business.

Asset-based advisory fees, in particular, grew significantly from the prior year in large part due to AUM reaching a fourth-consecutive all-time high at year-end.

Retail trading volumes also remained elevated throughout the year, boosting transaction-based commissions.

However, these positive drivers were offset to a degree by both lower interest-sensitive sweep income owing to

lower average sweep balances, as well as higher share-based compensation expenses associated with stock appreciation rights granted to financial advisors.

In the fourth quarter of 2024 alone, we recognized $20.5 million of expense related to these stock appreciation rights due to the significant increase in share price of our Class A non-voting common stock.

In comparison, we recognized a relatively modest expense of $4.3 million in the fourth quarter of 2023.

In our Capital Markets businesses, we saw our 2024 investment banking results benefit from a somewhat improved market environment which drove higher new issuance and transaction activity levels when compared to the prior year.

Though our revenues increased in 2024, we believe that capital markets conditions (and related transaction volumes) have yet to reach their full potential and expect that our business will stand to benefit when they do.

Our institutional trading business also performed quite well in 2024, with higher sales and trading revenues attributed to greater volumes and increased market share.

Overall, we are extremely pleased with the accomplishments that we achieved in 2024.

We ended the year with record revenues, AUM, stockholders’ equity and book value per share levels, and a significantly de-levered balance sheet after completing the redemption of our senior secured notes earlier in the fourth quarter of 2024.

We remain optimistic about our future and look forward to continuing to serve our clients.

The Firm’s operating results for the fourth quarter and full year 2025 were much improved.

We achieved record full year and quarterly earnings per share with increased revenues driven by broad-based strength across our core businesses.

Both of our operating segments benefited from a generally favorable macroeconomic environment, including a sustained rise in equity markets, which drove all major U.S.

indices to a third straight year of double-digit gains.

Markets continued to rally with support from an accommodative Federal Reserve and strong corporate earnings, helping offset concerns about trade tensions and a softening labor market.

Interest in, and announced investments in artificial intelligence platforms provided significant additional strength to equity markets.

The favorable market conditions benefited our Wealth Management business, as rising asset values underpinned increased client trading activity and lifted assets under management to record levels, resulting in higher related fees compared with the prior-year period.

Alternative Investments also benefited from certain sponsored hedge funds surpassing prior high-water marks, which generated meaningful incentive fees in the fourth quarter of 2025.

These increases were somewhat offset by lower fees earned on our FDIC sweep product due to reduced average sweep balances.

Our Capital Markets business also performed well and continued to build on the strength and momentum that we saw in the third quarter.

Investment Banking, in particular, experienced a continued wave of deal activity.

Underwriting and advisory transaction volumes remained strong, reflecting the benefits of prior investments we made in building our banking franchise.

We are very pleased with our 2025 financial performance which was achieved through the commitment of our employees and their continued focus on client outcomes.

Revenues and earnings per share reached a new record, our balance sheet remains conservatively positioned, and our stockholders’ equity and book value per share metrics reached fresh highs.

Our solid operating results and capital position allowed us to return additional value to shareholders in the form of a $1.00 per share special dividend in early January 2026.

Looking ahead, our Firm remains well-positioned to navigate evolving market and economic conditions and capitalize on opportunities across our businesses.

As we enter 2026, we believe that the momentum is likely to continue providing strong underpinnings to the equity markets and to results within our investment banking franchise.

RESULTS OF OPERATIONS

The following table and discussion summarizes the changes in the major revenue and expense categories for the past three

The following table and discussion summarizes the changes in the major revenue and expense categories for the past three years:

(Expressed in thousands )

24 unchanged sentences

Fiscal 2025 compared to Fiscal 2024

• Commission revenue was a record high $464.4 million for the year ended December 31, 2025, an increase of 13.4% compared with $409.7 million for the year ended December 31, 2024 due to higher overall transaction volumes

• Advisory fees were a record high $555.4 million for the year ended December 31, 2025, an increase of 14.9% compared with $483.4 million for the year ended December 31, 2024 due to higher management fees from advisory programs attributable to an increase in billable AUM levels and increased incentive fees from alternative investments

• Investment banking revenue was $266.4 million for the year ended December 31, 2025, an increase of 51.0% compared with $176.4 million for the year ended December 31, 2024 due to greater participation in M&A transactions with higher associated fees and higher new issuance activity levels

• Bank deposit sweep income for the year ended December 31, 2025 decreased $24.0 million or 17.3% from the prior year due to lower average cash sweep balances and lower short-term interest rates

• Interest revenue was $153.0 million for the year ended December 31, 2025, an increase of 12.9% compared with $135.5 million for the year ended December 31, 2024 primarily due to higher interest earned on trading inventories

• Principal transactions revenue was $50.2 million for the year ended December 31, 2025, a decrease of 8.2% compared with $54.7 million for the year ended December 31, 2024 primarily due to lower realized and unrealized gains from government securities trading activities partially offset by higher corporate bond trading income

• Other revenue of $33.8 million for the year ended December 31, 2025 was relatively flat compared to $33.9 million for the year ended December 31, 2024

• Compensation and related expenses totaled $1,016.5 million during the year ended December 31, 2025, an increase of 8.5% compared with the year ended December 31, 2024 primarily due to higher production-related expenses and incentive compensation accruals.

Compensation and related expenses as a percentage of revenue was 62.1% for the year ended December 31, 2025 compared with 65.4% for the year ended December 31, 2024

• Non-compensation expenses were $410.4 million during the year ended December 31, 2025, an increase of 5.2% compared with $389.9 million during the year ended December 31, 2024 due to higher underwriting and technology-related expenses

• The effective tax rate for the 2025 year improved to 29.9% compared with 32.6% for the prior year as the impact of certain unfavorable permanent items and nondeductible foreign losses was reduced due to higher income levels in the year ended December 31, 2025

Fiscal 2024 compared to Fiscal 2023

• Commission revenue was $409.7 million for the year ended December 31, 2024, an increase of 17.3% compared with $349.2 million for the year ended December 31, 2023 due to higher overall client activity

5 unchanged sentences

• Other revenue was $33.9 million for the year ended December 31, 2024, an increase of 44.1% compared to $23.5 million for the year ended December 31, 2023 primarily due to higher death benefit proceeds

• Compensation and related expenses totaled $936.8 million during the year ended December 31, 2024, an increase of 19.7% compared with the year ended December 31, 2023 primarily due to higher salary expense, production-related expenses, incentive compensation costs and elevated expenses associated with Oppenheimer stock appreciation rights (“OARs”), which were adversely impacted by the significant increase in the OPY Class A Share price.

Compensation and related expenses as a percentage of revenue was 65.4% for the year ended December 31, 2024 compared with 62.7% for the year ended December 31, 2023

1 unchanged sentence

• The effective income tax rate for the year ended December 31, 2024 was 32.6% compared with 35.3% for the year ended December 31, 2023 primarily due to the absence of the non-deductible $13.0 million regulatory settlement, which was recorded in 2023

Fiscal 2023 compared to Fiscal 2022

• Commission revenue was $349.2 million for the year ended December 31, 2023, a decrease of 5.7% compared with $370.4 million for the year ended December 31, 2022 due to decreased client activity in listed securities, OTC products and options, partially offset by higher commission income on annuities.

• Advisory fees were $415.7 million for the year ended December 31, 2023, a decrease of 2.3% compared with $425.6 million for the year ended December 31, 2022 due to lower management fees from advisory programs attributable to reduced billable AUM levels and lower incentive fees from alternative investments during the year.

• Investment banking revenue was $117.7 million for the year ended December 31, 2023, a decrease of 7.7% compared with $127.5 million for the year ended December 31, 2022 driven by an industry-wide slowdown in M&A transactions and lower levels of fixed income capital issuances, partially offset by higher equity underwriting fees.

• Bank deposit sweep income was $172.8 million for the year ended December 31, 2023, an increase of 65.3% compared with $104.6 million for the year ended December 31, 2022 due to higher short-term interest rates, partially offset by lower cash sweep balances.

• Interest revenue was $104.6 million for the year ended December 31, 2023, an increase of 72.2% compared with $60.7 million for the year ended December 31, 2022 due to higher short-term interest rates, which drove record full year margin interest income.

• Principal transactions revenue was $65.3 million for the year ended December 31, 2023, an increase of 210.7% compared with $21.0 million for the year ended December 31, 2022 primarily due to higher fixed income trading volumes.

• Other revenue was $23.5 million for the year ended December 31, 2023, a significant increase compared to $1.1 million for the year ended December 31, 2022 primarily due to increases in the cash surrender value of Corporate-owned life insurance during 2023, which fluctuates based on changes in fair value of the policies' underlying investments.

• Compensation and related expenses totaled $782.4 million during the year ended December 31, 2023, an increase of 5.6% compared with the year ended December 31, 2022 primarily due to higher base salary and deferred compensation costs.

Compensation and related expenses as a percentage of revenue was 62.7% for the year ended December 31, 2023 compared with 66.7% for the year ended December 31, 2022.

• Non-compensation expenses were $419.7 million during the year ended December 31, 2023, an increase of 29.3% compared with $324.6 million during the year ended December 31, 2022 due to the impact of significant legal costs and an accrual for a regulatory settlement.

• The effective income tax rate for the year ended December 31, 2023 was 35.3% compared with 29.5% for the year ended December 31, 2022 primarily due to the impact of a non-deductible regulatory settlement totaling $13.0 million.

BUSINESS SEGMENTS

2 unchanged sentences

Our Capital Markets and Corporate/Other segments were not impacted by these changes.

To provide historical information on a basis consistent with the revised segment presentation, the Company recast prior period segment results.

(Expressed in thousands)

33 unchanged sentences

Financial Advisor Headcount 924 931 (0.8)

• Retail commissions increased significantly from the prior year due to higher overall client activity.

• Advisory fees increased 16.4% from the prior year due to higher billable AUM during the year.

• Bank deposit sweep income for the full year decreased $34.0 million or 19.7% from the prior year due to lower short-term interest rates and lower cash sweep balances.

• Interest revenue increased 4.2% from the prior year due to higher average margin loan balances.

• Other revenue increased 30.6% compared with the prior year primarily due to higher death benefit proceeds and allocated syndicate fess.

• AUM were $49.4 billion, a new record at December 31, 2024, which is the basis for advisory fee billings for January 2025.

• The increase in AUM from December 31, 2023 to December 31, 2024 was comprised of higher asset values of $6.4 billion on existing client holdings, offset by net distributions of $0.9 billion

• Compensation expenses increased 21.3% from the prior year primarily due to greater production-related expenses and elevated costs associated with share appreciation rights.

• Non-compensation expenses decreased 22.4% from the prior year primarily due to significantly lower legal and regulatory costs.

• Retail commissions increased 6.2% from the prior year, reaching a record high, driven by higher retail transaction volumes

• Advisory fees increased 14.9% from the prior year, setting a new record, due to higher billable AUM and increased incentive fees from alternative investments

• Bank deposit sweep income for the full year decreased $24.0 million or 17.3% from the prior year due to lower average cash sweep balances and lower short-term interest rates

• Interest revenue was relatively flat with the prior year

• Other revenue increased 5.8% compared with the prior year primarily due to allocated syndicate fees and changes in market value of the Firm's investments in hedge funds and private equity funds

• AUM of $55.2 billion reached record levels at December 31, 2025, which is the basis for advisory fee billings for January 2026

• The $5.8 billion increase in AUM from December 31, 2024 to December 31, 2025 was largely due to higher asset values resulting from market appreciation

• Compensation expenses increased 5.0% from the prior year primarily due to greater production-related expenses, partially offset by lower costs associated with share appreciation rights

• Non-compensation expenses increased 6.0% from the prior year due to a number of items, including higher technology-related expenses and external portfolio manager costs that are directly related to higher AUM

The following table provides a breakdown of the change in assets under management for the year ended December 31, 2025:

27 unchanged sentences

Capital Markets reported revenue of $591.3 million for the year ended December 31, 2025, 32.1% higher compared with the prior year.

Pre-tax loss was $39.6 million compared with a pre-tax loss of $63.0 million for the prior year.

Pre-tax income was $56.2 million compared with a pre-tax loss of $39.6 million for the prior year.

(Expressed in thousands, except otherwise indicated )

14 unchanged sentences

Non-compensation 174,872 163,563 6.9

Pre-Tax Loss $ (39,596) $ (62,961) (37.1)

Pre-tax Income (Loss) $ 56,167 $ (39,596) (241.9)

Compensation Ratio 60.9 % 72.3 % (15.8)

2 unchanged sentences

* Percentage not meaningful

• Advisory fees earned from investment banking activities increased 54.0% compared with the prior year due to an increase in restructuring-related mandates and higher transaction volumes, particularly in the healthcare industry.

• Equities underwriting fees increased 36.2% compared with the prior year due to higher new issuance volumes.

• Fixed income underwriting fees were up 79.6% compared with the prior year primarily driven by an uptick in new issuance activity.

• Equities sales and trading increased 5.2% compared with the prior year due to higher trading volumes.

• Fixed income sales and trading increased 37.4% compared with the prior year driven by higher trading income attributable to higher volumes and increased market share

• Compensation expenses were higher than the prior year due to greater incentive compensation accruals and higher salary expenses associated with opportunistic hires.

• Non-compensation expenses were 17.2% higher compared with the prior year mainly due to an increase in interest expense in financing trading inventories.

• Advisory fees earned from investment banking activities increased 5.4% compared with the prior year due to greater participation in M&A transactions with higher associated fees

• Equities underwriting fees increased 163.8% compared with the prior year due to higher new issuance activity in the financial institutions, healthcare and technology sectors during the second half of 2025

• Fixed income underwriting fees were up $5.1 million, or 60.0%, compared with the prior year due to a higher number of public finance transactions

• Equities sales and trading revenue increased 26.7% compared with the prior year due to higher trading volumes, including increased options-related commissions

• Fixed income sales and trading revenue increased 10.5% compared with the prior year driven by higher trading income attributable to higher volumes and interest income earned on trading inventory

• Compensation expenses were higher than the prior year primarily due to higher incentive compensation and production-related expenses

• Non-compensation expenses were 6.9% higher compared with the prior year mainly due to an increase in technology and underwriting expenses, partially offset by lower interest expenses

CRITICAL ACCOUNTING ESTIMATES

7 unchanged sentences

When market observable inputs are not available, our judgment is applied to reflect those judgments that a market participant would use in valuing the same asset or liability.

Assumption and judgement - The fair value hierarchy established by ASC 820 prioritizes the inputs used in valuation techniques into the following three categories (highest to lowest priority):

Assumption and judgment - The fair value hierarchy established by ASC 820 prioritizes the inputs used in valuation techniques into the following three categories (highest to lowest priority):

• Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets;

5 unchanged sentences

The valuation of financial instruments are classified in Level 3 of the fair value hierarchy and consists of valuation techniques that incorporate one or more significant unobservable inputs, and therefore requires the greatest amount of management judgment.

As of December 31, 2024, the Company had $5.3 million in financial instruments, comprised of auction rate securities and trade claims, classified within Level 3 of the fair value hierarchy.

As of December 31, 2025, the Company had $128,000 of auction rate securities classified within Level 3 of the fair value hierarchy.

The Company has valued a convertible note using a discounted cash flow model and equity security warrants using a Black-Scholes option pricing model and categorized them in Level 3 of the fair value hierarchy due to the models' use of unobservable inputs.

As of December 31, 2025, the Company had $2.1 million and $1.2 million of convertible note and equity security warrants, respectively, in Level 3 assets.

Additionally, the Company classified a $17 million equity security associated with a consolidated private equity fund sponsored by the Company within Level 3 of the fair value hierarchy due to use of unobservable pricing inputs.

See Note 8 to the consolidated financial statements appearing in Item 8 for further information on the fair value definition, Level 1, Level 2 and Level 3 and related valuation techniques.

4 unchanged sentences

Critical estimates – In the normal course of business, the Company has been named as defendant or co-defendant in various legal actions, including arbitrations, class actions and other litigation, creating substantial exposure and periodic expenses.

The Company may also be subject to potential fines and penalties imposed by regulatory authorities.

Management is required to assess the probability of loss and estimate the amount of such loss when preparing its consolidated financial statements.

Assumption and judgement - The determination of the levels of these reserves requires significant judgment on the part of management.

Assumption and judgment - The determination of the levels of these reserves requires significant judgment on the part of management.

In accordance with applicable accounting guidance, we established reserves for litigation and regulatory matters where available information indicates that it is probable a liability had been incurred at the date of the consolidated financial statements and we can reasonably estimate the amount of that loss.

1 unchanged sentence

When determining whether to record a reserve, management considers many factors including, but not limited to, the amount of the claim;

the stage and forum of the proceeding, the sophistication of the claimant, the amount of the loss, if any, in the client's account and the possibility of wrongdoing, if any, on the part of an employee of the Company;

the stage and forum of the proceeding, the sophistication of the

claimant, the amount of the loss, if any, in the client's account and the possibility of wrongdoing, if any, on the part of an employee of the Company;

the basis and validity of the claim;

4 unchanged sentences

See Note 17 to the consolidated financial statements appearing in Item 8 for further details.

Impact if actual results differ from assumptions – Due to the inherent uncertainties of the legal and regulatory proceedings, our judgement may be materially different from the actual outcome.

Impact if actual results differ from assumptions – Due to the inherent uncertainties of the legal and regulatory proceedings, our judgment may be materially different from the actual outcome.

The assumptions we used to determine the estimates of reserves may be incorrect and the actual disposition of a legal or regulatory proceeding could be greater or less than the reserve amount.

4 unchanged sentences

We record uncertain tax positions in accordance with ASC 740, "Income Taxes", on the basis of a two-step process whereby we determine whether it is more-likely-than-not that the tax positions will be sustained on the basis of the technical merits of the position and, for those tax positions that meet the more-likely-than-not recognition threshold, we will recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.

Assumption and judgement - We recognize deferred tax assets to the extent we believe these assets are more likely than not to be realized.

Assumption and judgment - We recognize deferred tax assets to the extent we believe these assets are more likely than not to be realized.

In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies, and the results of recent operations.

In establishing a provision for income tax expense, we must make judgements and interpretations about the application of these inherently complex tax laws.

In establishing a provision for income tax expense, we must make judgments and interpretations about the application of these inherently complex tax laws.

We estimate when certain items will affect taxable income in the various jurisdictions in the future.

1 unchanged sentence

See Note 15 to the consolidated financial statements appearing in Item 8 for further details.

Impact if actual results differ from assumptions – Although we believe that our estimates and judgements are reasonable, actual results may differ from these estimates.

Some or all of these judgements are subject to review by the relevant taxing authorities.

Impact if actual results differ from assumptions – Although we believe that our estimates and judgments are reasonable, actual results may differ from these estimates.

Some or all of these judgments are subject to review by the relevant taxing authorities.

If one or more of the taxing authorities were to successfully challenge our right to realize some or all of the tax benefit we recorded, and we were not able to realize this benefit, our effective income tax rate in a given financial statement period could be materially affected and it could also have a material adverse effect on our consolidated financial statements.

1 unchanged sentence

The following Accounting Standards Updates (“ASU”) issued by the Financial Accounting Standards Board ("FASB") have not yet been adopted by the Company:

ASU 2023-09 – Income Taxes (Topic 740):

Improvements to Income Tax Disclosures

The FASB issued this ASU in December of 2023 to enhance the transparency and decision usefulness of income tax disclosures.

The amendments require certain entities to enhance the annual reconciliation of its statutory income tax rate to its effective tax rate by mandating the disclosure of the impact associated with specific categories and requiring separate disclosure for reconciling items exceeding certain quantitative thresholds.

The amendments also require entities to annually disclose the amount of taxes paid (net of refunds received) disaggregated by federal, state and foreign taxes, with separate disclosure of individual jurisdictions exceeding 5% of total income taxes paid.

The new guidance, which becomes effective in 2025, will not have an impact on our financial position or results of operations since it only amends certain disclosures.

ASU 2024-03 – Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40):

7 unchanged sentences

Oppenheimer has uncommitted arrangements with banks for borrowings on a fully-collateralized basis.

The amount of Oppenheimer's bank borrowings fluctuates in response to changes in the level of the Company's securities inventories and customer margin debt, changes in notes receivable from employees, investment in furniture, equipment and leasehold improvements, changes in stock loan balances and financing through

repurchase agreements.

investment in furniture, equipment and leasehold improvements, changes in stock loan balances and financing through repurchase agreements.

At December 31, 2025, the Company had a $76.8 million outstanding bank loan balance.

16 unchanged sentences

We will continue to review our historical treatment of these earnings to determine whether our historical practice will continue or whether a change is warranted.

Senior Secured Notes

On September 19, 2024, the Company issued a notice of redemption to the holders of its 5.50% Senior Secured Notes due in 2025 (the “Notes”) stating that it intended to redeem all of the $113.05 million aggregate principal amount of the Notes outstanding on October 10, 2024.

The redemption price was equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest.

All of the Notes were redeemed on October 10, 2024 and none remain outstanding.

The Notes were jointly and severally and fully and unconditionally guaranteed on a senior secured basis by E.A.

Viner International Co.

and Viner Finance Inc.

(together, the "Subsidiary Guarantors").

The following tables present the required selected financial information as of December 31, 2024 and for the twelve months ended December 31, 2024 for the Parent and Subsidiary Guarantors related to the previously outstanding Notes.

(Expressed in thousands) As of

December 31, 2024

Total Assets $ 2,441,237

Due From Non-Guarantor Subsidiary 86,229

Total Liabilities 573,873

Due To Non-guarantor Subsidiary 15,486

For the Year Ended

December 31, 2024

Total Revenue $ 10,558

Pre-Tax Income 1,174

Net Income 2,319

Subsequent to our redemption of the Notes on October 10, 2024, at the Company's request, both S&P and Moody's withdrew their ratings.

Immediately prior to the redemption of the Notes, S&P’s Corporate Family rating and rating on the Notes was a 'BB-' with a stable outlook while Moody’s Corporate Family rating and rating on the Notes was a “Ba3” with a stable outlook.

While the results of Oppenheimer Israel (OPCO) Ltd.

are not material, based on its recent performance, it is possible that a valuation allowance on the deferred tax assets of $2.7 million as of December 31, 2025 may be required in a future reporting period.

Currently, based on all available evidence, a valuation allowance is not needed and we are looking to mitigate the need to record a valuation allowance in the future.

For the most part, the Company's assets consist of cash and cash equivalents and assets that it can readily convert into cash.

The receivable from brokers, dealers and clearing organizations represents deposits for securities borrowed transactions, margin deposits or current transactions awaiting settlement.

The receivable from customers represents margin balances and amounts due on transactions awaiting settlement.

The receivables from brokers, dealers and clearing organizations represents deposits for securities borrowed transactions, margin deposits or current transactions awaiting settlement.

The receivables from customers represents margin balances and amounts due on transactions awaiting settlement.

Our receivables are, for the most part, collateralized by marketable securities.

Our collateral maintenance policies and procedures are designed to limit our exposure to credit risk.

Securities owned, with the exception of the auction rate securities and trade claims, are mainly comprised of actively trading, readily marketable securities.

Securities owned, with the exception of the auction rate securities, a convertible note, equity security warrants and an equity security associated with a consolidated private equity fund sponsored by the Company, are mainly comprised of actively trading, readily marketable securities.

We issued $14.2 million in forgivable notes (which are inherently illiquid) to employees for the year ended December 31, 2025 ($25.4 million for the year ended December 31, 2024) as upfront or backend inducements to commence or continue employment as the case may be.

The amount of funds allocated to such inducements will vary with hiring activity.

We satisfy our need for liquidity from internally generated funds, collateralized and uncollateralized bank borrowings, stock loans and repurchase agreements and warehouse facilities.

We satisfy our need for liquidity from internally generated funds, collateralized and uncollateralized bank borrowings, stock loans and repurchase agreements.

Bank borrowings are uncommitted in nature and, in most cases, collateralized by firm and customer securities.

1 unchanged sentence

Bank call loans are generally payable on demand and bear interest at various rates.

At December 31, 2024, bank call loans were $252.1 million (zero at December 31, 2023).

At December 31, 2025, bank call loans were $76.8 million ($252.1 million at December 31, 2024).

The average daily bank loan outstanding for the year ended December 31, 2025 was $269.6 million ($167.7 million for the year ended December 31, 2024).

4 unchanged sentences

We finance our government trading operations through the use of securities purchased under agreements to resell ("reverse repurchase agreements") and repurchase agreements.

Except as described below, repurchase and reverse repurchase agreements, principally involving government and agency securities, are carried at amounts at which securities subsequently will be resold or reacquired as specified in the respective agreements and include accrued interest.

Repurchase and reverse repurchase agreements, principally involving government and agency securities, are carried at amounts at which securities subsequently will be resold or reacquired as specified in the respective agreements and include accrued interest.

Repurchase and reverse repurchase agreements are presented on a net-by-counterparty basis, when the repurchase and reverse repurchase agreements are executed with the same counterparty, have the same explicit settlement date, are executed in accordance with a master netting arrangement, the securities underlying the repurchase and reverse repurchase agreements exist in "book entry" form and certain other requirements are met.

6 unchanged sentences

We manage our need for liquidity on a daily basis to ensure compliance with regulatory requirements.

Our liquidity needs may be affected by market conditions, increased inventory positions, business expansion and other unanticipated occurrences.

Our liquidity needs may be affected by market conditions, increased inventory positions or trading activity, business expansion, clearinghouse margin requirements and other unanticipated occurrences.

In the event that existing financial resources do not satisfy our liquidity needs, we may have to seek additional external financing.

The availability of such additional external financing may depend on market factors outside our control.

We have Corporate-owned life insurance policies which are utilized to fund certain non-qualified deferred compensation plans.

We have company-owned life insurance policies which are utilized to fund certain non-qualified deferred compensation plans.

Certain policies which could provide additional liquidity if needed had a cash surrender value of $109.1 million as of December 31, 2025.

5 unchanged sentences

For the Years Ended December 31,

Cash used in operating activities $ (108,168) $ (18,810)

Cash provided by (used in) operating activities $ 188,752 $ (108,168)

Cash used in investing activities (1,388) (3,839)

Cash provided by (used in) financing activities 116,322 (74,761)

Net increase (decrease) in cash and cash equivalents and restricted cash $ 4,315 $ (109,132)

Cash (used in) provided by financing activities (182,109) 116,322

Net increase in cash and cash equivalents $ 5,255 $ 4,315

Management believes that funds from operations, combined with our capital base and available credit facilities, are sufficient for our liquidity needs in the foreseeable future.

2 unchanged sentences

We may or may not be able to pass such increased funding costs on to our clients.

During periods of high volatility, we have seen increased calls for deposits of collateral to offset perceived risk between the Company's settlement liability to industry utilities such as the Options Clearing Corporation (“OCC”) and National Securities Clearing Corp.

During periods of high volatility, we have seen increased calls for deposits of collateral to offset perceived risk between the Company's settlement liability to industry clearing houses such as the Depository Trust Company ("DTC"), Options Clearing Corporation (“OCC”) and National Securities Clearing Corp.

(“NSCC”) as well as more stringent collateral arrangements with our bank lenders.

Recent reductions in the settlement cycle to one day are believed to have reduced such requirements.

All such requirements have been met in the ordinary course with available collateral.

REGULATORY MATTERS AND DEVELOPMENTS

The recent reduction of the settlement cycle for equities transactions in the U.S.

has substantially reduced

settlement risks.

All such requirements have been and will be met in the ordinary course with available collateral or short-term borrowings.

REGULATORY AND TAXATION MATTERS AND DEVELOPMENTS

See the discussion of the regulatory environment in which we operate and the impact on our operations of certain rules and regulations in Item 1 “Business - Regulation” herein for additional information.

Regulatory Capital Requirements

Oppenheimer and many of its affiliates are each subject to various regulatory capital requirements.

1 unchanged sentence

See “Business – Regulatory - Regulatory Capital Requirements” in Part I, Item 1 and Note 18 of the Notes to Consolidated Financial Statements in Item 8 for further information on regulatory capital requirements.

Amendments to SEC Rule 15c3-3

On December 20, 2024, the SEC adopted rule amendments to SEC Rule 15c3-3 (the customer protection rule) to require certain broker-dealers, including those with average total credits (amounts owed to customers) equal to or greater than $500 million, to increase the frequency with which they perform computation of the net cash they owe customers and proprietary accounts of other broker-dealers ("PAB") from weekly to daily.

Impacted entities must perform the customer and PAB reserve computations daily beginning no later than December 31, 2025.

Impacted entities must perform the customer and PAB reserve computations daily beginning no later than June 30, 2026.

We anticipate that the new amendments will impact our principal broker dealer and may result in an increase in required staffing levels.

The Organization for Economic Co-operation and Development (“OECD”) issued the Global Anti-Base Erosion Model Rules (“Pillar II”), which among its provisions, requires companies to pay a minimum corporate tax rate of 15% in each jurisdiction in which they do business.

While we have foreign affiliates that operate within the scope of Pillar II, we do not believe that it will have a material impact on our consolidated results of operations or effective income tax rate.

One Big Beautiful Bill Act

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act (the “OBBBA”), which includes several U.S.

federal income tax provisions affecting businesses.

Among its changes, the OBBBA modifies certain Inflation Reduction Act (“IRA”) and Tax Cuts & Jobs Act (“TCJA”) provisions, including allowing companies to expense 100% of the cost of qualified property in the year it is initially placed in service.

While changes in tax law are accounted for in the period of enactment, there are varied effective dates for the OBBBA’s provisions, some of which extend into 2026.

The passage of the OBBBA did not and is not expected to have a material impact on our financial position or results of operations.

Limitations on Tax Deductions for Compensation Paid to Certain Executives and Officers

Internal Revenue Code Section 162(m) (“Section 162(m)”) currently limits a public company’s tax deductions for compensation above $1 million paid to “covered employees,” which includes the Chief Executive Officer, Chief Financial Officer and the next three highest paid officers.

Amendments to Section 162(m) included in the American Rescue Plan Act of 2021, which become effective on January 1, 2027, expand the definition of “covered employees” to include the next five highest paid employees or officers.

If there are no further changes or amendments to Section 162(m), or if the definition of “covered employees” is further expanded, we expect the Company’s operating results to be adversely impacted due to anticipated increases in the Company’s income tax expense and effective tax rate.

Since the impact of these changes is dependent on our compensation and personnel mix beginning in 2027, we are unable to quantify the potential impact at this time.

Frequency of Reporting Requirements for Public Companies

The current administration and the SEC have recently suggested that they will propose rulemaking that will shift certain SEC reporting requirements for public companies from reporting quarterly (on Form 10-Q) to semi-annually.

It is the Company's present intention to continue to report results on a quarterly basis.

Other Regulatory Matters

On March 31, 2025, Oppenheimer received an administrative subpoena from the Office of Foreign Asset Control of the United States Department of the Treasury (“OFAC”) requesting certain information regarding Oppenheimer’s anti-money laundering policies and procedures.

Oppenheimer has responded and will continue to respond to the OFAC subpoena.

FACTORS AFFECTING "FORWARD-LOOKING STATEMENTS"

3 unchanged sentences

These risks and uncertainties, many of which are beyond the Company’s control, include, but are not limited to:

(i) transaction volume in the securities markets, (ii) the volatility of the securities markets, (iii) fluctuations in interest rates, (iv) changes in regulatory requirements that could affect the cost and method of doing business, (v) general economic conditions, both domestic and international, including inflation, recession, and changes in consumer confidence and spending, (vi) competition from existing financial institutions, new entrants and other participants in the securities markets and financial services industry, (vii) potential cybersecurity threats and attacks, (viii) legal developments affecting the litigation experience of the securities industry and the Company, (ix) changes in foreign, federal and state tax laws that could affect the popularity of products sold by the Company or impose taxes on securities transactions, (x) the adoption and implementation of the SEC’s “Regulation Best Interest” and other regulations adopted in recent years, (xi) war, terrorist acts and nuclear confrontation as well as political unrest, including events relating to the Israel-Hamas war, the conflict with Hezbollah and Iran and related unrest in the Middle East and Russia's invasion of Ukraine and related Western sanctions, (xii) the Company’s ability to achieve its business plan, (xiii) the effects of the economy on the Company’s ability to find and maintain financing options and liquidity, (xiv) credit, operational, legal and regulatory risks, (xv) risks related to foreign operations, (xvi) the effect of technological innovation on the financial services industry and securities business including but not limed to risks associated with the use of artificial intelligence, (xvii) risks related to election results, Congressional gridlock, political and social unrest, government shutdowns and investigations, trade wars, bank failures, changes in or uncertainty surrounding regulation, and the potential for default by the U.S.

military activity in Venezuela, (xii) the Company’s ability to achieve its business plan, (xiii) the effects of the economy on the Company’s ability to find and maintain financing options and liquidity, (xiv) credit, operational, legal and regulatory risks, (xv) risks related to foreign operations, (xvi) the effect of technological innovation on the financial services industry and securities business including but not limed to risks associated with the use of artificial intelligence, (xvii) risks related to election results, Congressional gridlock, political and social unrest, government shutdowns and investigations, government spending, inflation, immigration, impact of tariffs and trade wars, bank failures, changes in or uncertainty surrounding regulation, and the potential for default by the U.S.

government on the nation's debt, (xviii) risks related to changes in capital requirements under international standards that may cause banks to back away from providing funding to the securities industry and (xix) economic, market, political and social impact of, and uncertainty relating to, any catastrophic events, including pandemics, epidemics or other outbreaks of disease, climate-related risks such as natural disasters and extreme weather events.

There can be no assurance that the Company has correctly or completely identified and assessed all of the factors affecting the Company's business See “Risk Factors” in Part I, Item 1A.

There can be no assurance that the Company has correctly or completely identified and assessed all of the factors affecting the Company's business.

See “Risk Factors” in Part I, Item 1A.

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