PEOPLES BANCORP INC 10-Q

ITEM 1. FINANCIAL STATEMENTS PEOPLES BANCORP INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS March 31, 2025 December 31, 2024 (Dollars in thousands) (Unaudited) Assets Cash and cash equivalents: Cash and balances due from banks $ 126,307 $ 108,721 Interest-bearing deposits in other banks 60,671 108,943 Total cash and cash equivalents 186,978 217,664 Available-for-sale investment securities, at fair value (amortized cost of $ 1,199,677 at March 31, 2025 and $ 1,229,382 at December 31, 2024) (a) 1,073,674 1,083,555 Held-to-maturity investment securities, at amortized cost (fair value of $ 683,315 at March 31, 2025 and $ 692,499 at December 31, 2024) (a) 753,466 774,800 Other investment securities 51,322 60,132 Total investment securities (a) 1,878,462 1,918,487 Loans and leases, net of deferred fees and costs (b) 6,428,526 6,358,003 Allowance for credit losses ( 65,232 ) ( 63,348 ) Net loans and leases (c) 6,363,294 6,294,655 Loans held for sale 2,407 2,348 Bank premises and equipment, net of accumulated depreciation 103,847 103,669 Bank owned life insurance 144,843 143,710 Goodwill 363,199 363,199 Other intangible assets 36,900 39,223 Other assets 166,070 171,292 Total assets $ 9,246,000 $ 9,254,247 Liabilities Deposits: Non-interest-bearing $ 1,526,285 $ 1,507,661 Interest-bearing 6,208,464 6,082,544 Total deposits 7,734,749 7,590,205 Short-term borrowings 19,228 193,474 Long-term borrowings 237,000 238,073 Accrued expenses and other liabilities 117,202 120,905 Total liabilities $ 8,108,179 $ 8,142,657 Stockholders’ equity Preferred shares, no par value, 50,000 shares authorized, no shares issued at March 31, 2025 or at December 31, 2024 — — Common shares, no par value, 50,000,000 shares authorized, 36,795,107 shares issued at March 31, 2025 and 36,782,601 shares issued at December 31, 2024, including at each date shares held in treasury 866,416 866,844 Retained earnings 398,218 388,109 Accumulated other comprehensive loss, net of deferred income taxes ( 95,691 ) ( 110,385 ) Treasury stock, at cost, 1,220,262 shares at March 31, 2025 and 1,311,175 shares at December 31, 2024 ( 31,122 ) ( 32,978 ) Total stockholders’ equity $ 1,137,821 $ 1,111,590 Total liabilities and stockholders’ equity $ 9,246,000 $ 9,254,247 (a) Available-for-sale investment securities and held-to-maturity investment securities are presented net of allowance for credit losses of $ 0 and $ 237 , respectively, at March 31, 2025, and $ 0 and $ 237 , respectively, at December 31, 2024. (b) Also referred to throughout this Quarterly Report on Form 10-Q as "total loans" and "loans held for investment." (c) Also referred to throughout this Quarterly Report on Form 10-Q as "net loans." See Notes to the Unaudited Condensed Consolidated Financial Statements 3 Table of Contents PEOPLES BANCORP INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended March 31, (Dollars in thousands, except per share data) 2025 2024 Interest income: Interest and fees on loans and leases $ 107,302 $ 110,749 Interest and dividends on taxable investment securities 15,372 13,919 Interest on tax-exempt investment securities 968 1,003 Other interest income 900 1,922 Total interest income 124,542 127,593 Interest expense: Interest on deposits 35,164 32,450 Interest on short-term borrowings 508 5,038 Interest on long-term borrowings 3,615 3,465 Total interest expense 39,287 40,953 Net interest income 85,255 86,640 Provision for credit losses 10,190 6,102 Net interest income after provision for credit losses 75,065 80,538 Non-interest income: Insurance income 6,054 6,498 Electronic banking income 5,885 6,046 Trust and investment income 5,061 4,599 Deposit account service charges 4,015 4,223 Lease income 3,446 2,016 Bank owned life insurance income 1,133 1,500 Mortgage banking income 396 321 Net loss on investment securities ( 2 ) ( 1 ) Net loss on asset disposals and other transactions ( 361 ) ( 341 ) Other non-interest income 1,472 918 Total non-interest income 27,099 25,779 Non-interest expense: Salaries and employee benefit costs 39,821 38,893 Data processing and software expense 7,005 5,769 Net occupancy and equipment expense 5,612 6,283 Professional fees 3,087 2,967 Amortization of other intangible assets 2,213 2,788 Electronic banking expense 2,025 1,781 Federal Deposit Insurance Corporation ("FDIC") insurance expense 1,251 1,186 Other loan expenses 1,119 1,076 Operating lease expense 985 639 Franchise tax expense 929 881 Marketing expense 903 1,056 Communication expense 734 799 Travel and entertainment expense 500 608 Other non-interest expense 4,603 3,739 Total non-interest expense 70,787 68,465 Income before income taxes 31,377 37,852 Income tax expense 7,041 8,268 Net income $ 24,336 $ 29,584 Earnings per common share - basic $ 0.69 $ 0.85 Earnings per common share - diluted $ 0.68 $ 0.84 Weighted-average number of common shares outstanding - basic 34,895,723 34,740,349 Weighted-average number of common shares outstanding - diluted 35,297,135 35,051,810 Cash dividends declared $ 14,227 $ 13,745 Cash dividends declared per common share $ 0.40 $ 0.39 See Notes to the Unaudited Condensed Consolidated Financial Statements 4 Table of Contents PEOPLES BANCORP INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) Three Months Ended March 31, (Dollars in thousands) 2025 2024 Net income $ 24,336 $ 29,584 Other comprehensive income (loss): Available-for-sale investment securities: Gross unrealized holding gain (loss) arising during the period 19,819 ( 9,887 ) Related tax (expense) benefit ( 4,620 ) 2,340 Reclassification adjustment for net gain included in net income 2 1 Related tax (expense) benefit — — Net effect on other comprehensive income (loss) 15,201 ( 7,546 ) Cash flow hedges: Net loss arising during the period ( 236 ) ( 640 ) Related tax benefit 55 149 Reclassification adjustment for net (loss) gain included in net income ( 425 ) 896 Related tax benefit (expense) 99 ( 209 ) Net effect on other comprehensive (loss) income ( 507 ) 196 Total other comprehensive income (loss), net of tax 14,694 ( 7,350 ) Total comprehensive income $ 39,030 $ 22,234 See Notes to the Unaudited Condensed Consolidated Financial Statements 5 Table of Contents PEOPLES BANCORP INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) Accumulated Other Comprehensive Loss Total Stockholders' Equity Common Shares Retained Earnings Treasury Stock (Dollars in thousands) Balance, December 31, 2024 $ 866,844 $ 388,109 $ ( 110,385 ) $ ( 32,978 ) $ 1,111,590 Net income — 24,336 — — 24,336 Other comprehensive income, net of tax — — 14,694 — 14,694 Cash dividends declared — ( 14,227 ) — — ( 14,227 ) Reissuance of treasury stock for common share awards ( 3,254 ) — — 3,254 — Repurchase of treasury stock in connection with employee incentive program and compensation plan for Boards of Directors — — — ( 1,754 ) ( 1,754 ) Common shares issued under dividend reinvestment plan 335 — — — 335 Common shares issued under compensation plan for Boards of Directors 17 — — 99 116 Common shares issued under employee stock purchase plan 44 — — 257 301 Stock-based compensation 2,430 — — — 2,430 Balance, March 31, 2025 $ 866,416 $ 398,218 $ ( 95,691 ) $ ( 31,122 ) $ 1,137,821 6 Table of Contents Accumulated Other Comprehensive Loss Total Stockholders' Equity Common Shares Retained Earnings Treasury Stock (Dollars in thousands) Balance, December 31, 2023 $ 865,227 $ 327,237 $ ( 101,590 ) $ ( 37,340 ) $ 1,053,534 Net income — 29,584 — — 29,584 Other comprehensive loss, net of tax — — ( 7,350 ) — ( 7,350 ) Cash dividends declared — ( 13,745 ) — — ( 13,745 ) Reissuance of treasury stock for common share awards ( 6,862 ) — — 6,862 — Repurchase of treasury stock in connection with employee incentive program and compensation plan for Boards of Directors — — — ( 869 ) ( 869 ) Common shares repurchased under share repurchase program — — — ( 3,000 ) ( 3,000 ) Common shares issued under dividend reinvestment plan 455 — — — 455 Common shares issued under compensation plan for Boards of Directors 21 — — 117 138 Common shares issued under employee stock purchase plan 60 — — 171 231 Stock-based compensation 3,024 — — — 3,024 Balance, March 31, 2024 $ 861,925 $ 343,076 $ ( 108,940 ) $ ( 34,059 ) $ 1,062,002 See Notes to the Unaudited Condensed Consolidated Financial Statements 7 Table of Contents PEOPLES BANCORP INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Three Months Ended March 31, (Dollars in thousands) 2025 2024 Net cash provided by operating activities $ 34,276 $ 37,009 Investing activities: Available-for-sale investment securities: Purchases — ( 105,652 ) Proceeds from sales 967 — Proceeds from principal payments, calls and prepayments 28,401 26,976 Held-to-maturity investment securities: Purchases ( 14,909 ) ( 5,114 ) Proceeds from principal payments 36,515 9,268 Other investment securities: Purchases ( 2,646 ) ( 7,302 ) Proceeds from sales 11,367 8,028 Net increase in loans held for investment ( 74,804 ) ( 43,339 ) Net expenditures for premises and equipment ( 2,748 ) ( 3,870 ) Proceeds from sales of other real estate owned 210 — Proceeds from bank owned life insurance contracts — 486 Investment in limited partnership and tax credit funds — ( 2,566 ) Net cash used in investing activities ( 17,647 ) ( 123,085 ) Financing activities: Net increase (decrease) in non-interest-bearing deposits 18,624 ( 99,286 ) Net increase in interest-bearing deposits 125,655 273,573 Net decrease in short-term borrowings ( 174,246 ) ( 87,625 ) Proceeds from long-term borrowings 3,295 26,770 Payments on long-term borrowings ( 4,621 ) ( 7,047 ) Cash dividends paid ( 14,561 ) ( 13,893 ) Purchase of treasury stock under share repurchase program — ( 3,000 ) Purchase of treasury stock in connection with employee incentive program and compensation plan for Boards of Directors to be held as treasury stock ( 1,754 ) ( 869 ) Proceeds from issuance of common shares 293 451 Net cash (used in) provided by financing activities ( 47,315 ) 89,074 Net (decrease) increase in cash and cash equivalents ( 30,686 ) 2,998 Cash and cash equivalents at beginning of period 217,664 426,722 Cash and cash equivalents at end of period $ 186,978 $ 429,720 Supplemental cash flow information: Interest paid $ 37,531 $ 37,614 Income taxes paid 6,070 70 Supplemental noncash disclosures: Transfers from total loans to other real estate owned — 64 Noncash recognition of new leases 852 509 See Notes to the Unaudited Condensed Consolidated Financial Statements 8 Table of Contents PEOPLES BANCORP INC. AND SUBSIDIARIES NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Note 1 Summary of Significant Accounting Policies Basis of Presentation: The accompanying Unaudited Condensed Consolidated Financial Statements of Peoples Bancorp Inc. and its subsidiaries ("Peoples" refers to Peoples Bancorp Inc. and its consolidated subsidiaries collectively, except where the context indicates the reference relates solely to Peoples Bancorp Inc.) have been prepared in accordance with accounting principles generally accepted in the United States ("US GAAP") for interim financial information and the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, these financial statements do not contain all of the information and footnotes required by US GAAP for annual financial statements and should be read in conjunction with Peoples’ Annual Report on Form 10-K for the fiscal year ended December 31, 2024 ("Peoples' 2024 Form 10-K"). The accounting and reporting policies followed in the presentation of the accompanying Unaudited Condensed Consolidated Financial Statements are consistent with those described in "Note 1 Summary of Significant Accounting Policies" of the Notes to the Consolidated Financial Statements included in Peoples’ 2024 Form 10-K, as updated by the information contained in this Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025 (this "Form 10-Q"). Management has evaluated all significant events and transactions that occurred after March 31, 2025 for potential recognition or disclosure in these Unaudited Condensed Consolidated Financial Statements. In the opinion of management, these Unaudited Condensed Consolidated Financial Statements reflect all adjustments necessary to present fairly such information for the periods and at the dates indicated. Such adjustments are normal and recurring in nature. Certain items in prior financial statements have been reclassified to conform to the current presentation, which had no impact on net income, total comprehensive income, net cash provided by operating activities or total stockholders’ equity. Intercompany accounts and transactions have been eliminated. The Consolidated Balance Sheet at December 31, 2024, contained herein, has been derived from the audited Consolidated Balance Sheet included in Peoples’ 2024 Form 10-K. The preparation of the condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Results of operations for interim periods are not necessarily indicative of the results to be expected for the full year, due in part to seasonal variations and unusual or infrequently occurring items. Operating Segments: As a community banking entity, Peoples offers its customers a full range of products including a complete line of banking, leasing, insurance, investment and trust solutions. Peoples’ business activities are currently confined to a single reportable operating segment, which is community banking. Peoples’ single operating segment was determined based on the similar economic characteristics shared by the components of community banking. Peoples’ chief operating decision maker (“CODM”) is composed of its President and Chief Executive Officer, and its Chief Financial Officer. Peoples’ CODM considers all components of consolidated interest income, interest expense, non-interest income, and non-interest expense as presented in Peoples’ Consolidated Statements of Operations for the purposes of assessing performance of Peoples’ single reportable segment and allocating resources within its reportable segment. The CODM does not review segment revenue or expense information at a lower level than what is included in Peoples’ Consolidated Statements of Operations. New Accounting Pronouncements: From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard setting bodies that are adopted by Peoples as of the required effective dates. Refer to "Note 1 Summary of Significant Accounting Policies" of the Notes to the Consolidated Financial Statements included in Peoples’ 2024 Form 10-K. Unless otherwise discussed, management believes the impact of any recently issued standards, including those issued but not yet effective, will not have a material impact on Peoples' financial statements taken as a whole. Note 2 Fair Value of Assets and Liabilities Fair value represents the amount expected to be received to sell an asset or paid to transfer a liability in its principal or most advantageous market in an orderly transaction between market participants at the measurement date. In accordance with fair value accounting guidance, Peoples measures, records and reports various types of assets and liabilities at fair value on either a recurring or a non-recurring basis in the Unaudited Condensed Consolidated Financial Statements. Those assets and liabilities are presented below in the sections entitled “Assets and Liabilities Required to be Measured and Reported at Fair Value on a Recurring Basis” and “Assets and Liabilities Required to be Measured and Reported at Fair Value on a Non-Recurring Basis.” Depending on the nature of the asset or the liability, Peoples uses various valuation methodologies and assumptions to estimate fair value. The measurement of fair value under US GAAP uses a hierarchy, which is described in "Note 1 Summary of Significant Accounting Policies" of the Notes to the Consolidated Financial Statements included in Peoples' 2024 Form 10-K. Assets and liabilities are assigned to a level within the fair value hierarchy based on the lowest level of significant input used to measure fair value. Assets and liabilities may change levels within the fair value hierarchy due to market conditions or other circumstances. Those transfers are recognized on the date of the event that prompted the transfer. There were no transfers of assets or 9 Table of Contents liabilities required to be measured at fair value on a recurring basis between levels of the fair value hierarchy during the periods presented. Assets and Liabilities Required to be Measured and Reported at Fair Value on a Recurring Basis The following table provides the fair value for assets and liabilities required to be measured and reported at fair value on a recurring basis on the Unaudited Consolidated Balance Sheets by level in the fair value hierarchy. Recurring Fair Value Measurements at Reporting Date March 31, 2025 December 31, 2024 (Dollars in thousands) Level 1 Level 2 Level 1 Level 2 Assets: Available-for-sale investment securities: Obligations of: U.S. Treasury and government agencies $ 14,343 $ — $ 15,196 $ — U.S. government sponsored agencies — 213,063 — 209,083 States and political subdivisions — 195,505 — 196,301 Residential mortgage-backed securities — 593,979 — 601,802 Commercial mortgage-backed securities — 52,636 — 55,065 Bank-issued trust preferred securities — 4,148 — 6,108 Total available-for-sale securities $ 14,343 $ 1,059,331 $ 15,196 $ 1,068,359 Equity investment securities (a) 188 245 197 244 Nonqualified deferred compensation (a) (b) 5,164 — 4,898 — Derivative assets (c) — 14,092 — 18,743 Liabilities: Derivative liabilities (d) $ — $ 12,965 $ — $ 17,046 (a) Included in "Other investment securities" on the Unaudited Consolidated Balance Sheets. For additional information, see "Note 3 Investment Securities" of the Notes to the Unaudited Condensed Consolidated Financial Statements. (b) Investments in the nonqualified deferred compensation plan consist of mutual funds. (c) Included in " Other assets " on the Unaudited Consolidated Balance Sheets. For additional information, see "Note 10 Derivative Financial Instruments" of the Notes to the Unaudited Condensed Consolidated Financial Statements. (d) Included in " Accrued expenses and other liabilities " on the Unaudited Consolidated Balance Sheets. For additional information, see "Note 10 Derivative Financial Instruments" of the Notes to the Unaudited Condensed Consolidated Financial Statements. Available-for-Sale Investment Securities: The fair values used by Peoples are obtained from an independent pricing service and represent either quoted market prices for the identical securities (Level 1) or fair values determined by pricing models using a market approach that considers observable market data, such as interest rate volatility, secured overnight funding rate ("SOFR") (or other relevant) yield curves, credit spreads and prices from market makers and live trading systems (Level 2). Management reviews the valuation methodology and quality controls utilized by the pricing services or broker in management's overall assessment of the reasonableness of the fair values provided, and challenges prices when management believes a material discrepancy in pricing exists. Equity Investment Securities: The fair values of Peoples' equity investment securities are obtained from q uoted prices in active exchange markets for identical assets or liabilities (Level 1) or quoted prices in less active markets (Level 2). Nonqualified deferred compensation: The underlying assets relating to the nonqualified deferred compensation plan are included in a trust and primarily consist of cash and exchange traded mutual funds, which values are based on market prices (Level 1). Derivative Assets and Derivative Liabilities : The fair value for derivative financial instruments is determined based on third-party models, which leverages current market interest rates, broker-dealer quotations on similar products, or other related input parameters (Level 2). 10 Table of Contents Assets and Liabilities Required to be Measured and Reported at Fair Value on a Non-Recurring Basis The following table provides the fair value for each class of assets and liabilities required to be measured and reported at fair value on a non-recurring basis on the Unaudited Consolidated Balance Sheets by level in the fair value hierarchy at March 31, 2025 and December 31, 2024. Non-Recurring Fair Value Measurements at Reporting Date March 31, 2025 December 31, 2024 (Dollars in thousands) Level 2 Level 3 Level 2 Level 3 Assets: Collateral dependent loans $ — $ 3,676 $ — $ 4,375 Loans held for sale (a) 924 — 1,499 — Other real estate owned — — — 5,891 (a) Loans held for sale are presented gross of a valuation allowance of $ 64 and $ 166 at March 31, 2025 and at December 31, 2024, respectively. Collateral Dependent Loans: Loans for which repayment is dependent upon the operation or sale of collateral, as the borrower is experiencing financial difficulty, are considered collateral dependent. Peoples utilizes outside third-party appraisal services to value the underlying collateral, which Peoples then uses to report the loans at their fair value (Level 3). Loans Held for Sale: Loans originated and intended to be sold in the secondary market, generally one-to-four family residential loans, are carried, in aggregate, at the lower of cost or estimated fair value. Peoples uses a valuation model using quoted market prices of similar instruments in arriving at the fair value (Level 2). Other Real Estate Owned ("OREO"): OREO, included in "Other assets" on the Unaudited Consolidated Balance Sheets, is comprised primarily of commercial and residential real estate properties acquired by Peoples in satisfaction of a loan. OREO obtained in satisfaction of a loan is recorded at the lower of cost or estimated fair value, less estimated costs to sell the property. The carrying value of OREO is not re-measured to fair value on a recurring basis, but is based on recent real estate appraisals and is updated at least annually. These appraisals may utilize a single valuation approach or a combination of approaches, including the comparable sales approach and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available (Level 3). 11 Table of Contents Financial Instruments Not Required to be Measured or Reported at Fair Value The following table provides the carrying amount for each class of assets and liabilities and the fair value for certain financial instruments that are not required to be measured or reported at fair value on the Unaudited Consolidated Balance Sheets. Fair Value Measurements of Other Financial Instruments (Dollars in thousands) Fair Value Hierarchy Level March 31, 2025 December 31, 2024 Carrying Amount Fair Value Carrying Amount Fair Value Assets: Cash and cash equivalents 1 $ 186,978 186,978 $ 217,664 $ 217,664 Held-to-maturity investment securities: Obligations of: U.S. government sponsored agencies 2 222,698 215,377 233,302 223,294 States and political subdivisions (a) 2 142,513 112,471 142,691 110,848 Residential mortgage-backed securities 2 290,023 271,796 300,290 276,278 Commercial mortgage-backed securities 2 98,469 83,671 98,754 82,079 Total held-to-maturity securities 753,703 683,315 775,037 692,499 Other investment securities: Other investment securities at cost: Federal Home Loan Bank ("FHLB") stock N/A 14,797 14,797 24,606 24,606 Federal Reserve Bank ("FRB") stock N/A 27,114 27,114 27,114 27,114 Other investment securities (b) N/A 3,814 3,814 3,073 3,073 Total other investment securities at cost 45,725 45,725 54,793 54,793 Loans and leases, net of deferred fees and costs (c) 3 6,428,526 6,346,657 6,358,003 6,240,751 Bank owned life insurance 2 144,843 144,843 143,710 143,710 Liabilities: Deposits 2 $ 7,734,749 $ 6,891,785 $ 7,590,205 $ 6,713,360 Short-term borrowings 2 19,228 19,227 193,474 192,964 Long-term borrowings 2 237,000 258,355 238,073 258,195 (a) Obligations of states and political subdivisions are presented gross of an allowance for credit losses of $ 237 at both March 31, 2025 and December 31, 2024. (b) "Other investment securities", as reported on the Unaudited Consolidated Balance Sheets, also included equity investment securities at March 31, 2025 and at December 31, 2024, which are reported in the Assets and Liabilities Required to be Measured and Reported at Fair Value on a Recurring Basis table above and not included in this table. (c) Loans and leases, net of deferred fees and costs, are presented gross of an allowance for credit losses of $ 65.2 million and $ 63.3 million at March 31, 2025 and at December 31, 2024, respectively. For certain financial assets and liabilities, carrying value approximates fair value due to the nature of the financial instrument. These financial instruments include cash and cash equivalents and overnight borrowings. Peoples used the following methods and assumptions in estimating the fair value of the following financial instruments: Cash and Cash Equivalents: Cash and cash equivalents include cash on hand, balances due from other banks, interest-bearing deposits in other banks, federal funds sold and other short-term investments with original maturities of 90 days or less. The carrying amount for cash and cash equivalents balances are a reasonable estimate of fair value (Level 1). Held-to-Maturity Investment Securities: The fair values used by Peoples are obtained from an independent pricing service and represent fair values determined by pricing models using a market approach that considers observable market data, such as interest rate volatility, relevant yield curves, credit spreads and prices from market makers and live trading systems (Level 2). When observable market data is absent, the independent pricing service estimates prices based on underlying cash flow characteristics and discount rates and compares them to similar securities (Level 3). Management reviews the valuation methodology and quality controls utilized by the pricing services in management's overall assessment of the reasonableness of the fair values provided, and challenges prices when management believes a material discrepancy in pricing exists. Other Investment Securities: Other investment securities at cost are not recorded at fair value as they are not marketable securities. FHLB and FRB stock are both recorded at cost. 12 Table of Contents Loans and Leases, Net of Deferred Fees and Costs: The fair value of portfolio loans and leases assumes sale of the underlying notes to a third-party financial investor. Accordingly, this value is not necessarily the value to Peoples if the notes were held to maturity. Peoples considers interest rate, credit and market factors in estimating the fair value of loans and leases (Level 3). Fair values for loans and leases are estimated using a discounted cash flow methodology. The discount rates take into account interest rates currently being offered to customers for loans and leases with similar terms, the credit risk associated with the loans and leases and other market factors, including liquidity. Bank Owned Life Insurance: Peoples' bank owned life insurance policies are recorded at their cash surrender value (Level 2). Peoples recognizes tax-exempt income from the periodic increases in the cash surrender value of these policies and from death benefits. Deposits: The fair value of fixed-maturity certificates of deposit ("CDs") is estimated using a discounted cash flow calculation based on current rates offered for deposits of similar remaining maturities. Demand and other non-fixed-maturity deposits are estimated using a discounted cash flow calculation based on maturity, attrition and re-pricing assumptions (Level 2). Short-term Borrowings: The fair value of short-term borrowings is estimated using a discounted cash flow analysis based on rates currently available to Peoples for borrowings with similar terms (Level 2). Long-term Borrowings: The fair value of long-term borrowings is estimated using a discounted cash flow analysis based on rates currently available to Peoples for borrowings with similar terms (Level 2). Certain financial assets and financial liabilities that are not required to be measured or reported at fair value can be subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). These financial assets and financial liabilities include the following: customer relationships, the deposit base, and other information required to compute Peoples’ aggregate fair value, which are not included in the above information. Accordingly, the fair values described above are not intended to represent the aggregate fair value of Peoples. Note 3 Investment Securities Available-for-sale The following table summarizes Peoples' available-for-sale investment securities: (Dollars in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value March 31, 2025 Obligations of: U.S. Treasury and government agencies $ 14,250 $ 154 $ ( 61 ) $ 14,343 U.S. government sponsored agencies 223,585 239 ( 10,761 ) 213,063 States and political subdivisions 223,325 39 ( 27,859 ) 195,505 Residential mortgage-backed securities 673,730 1,799 ( 81,550 ) 593,979 Commercial mortgage-backed securities 60,287 1 ( 7,652 ) 52,636 Bank-issued trust preferred securities 4,500 — ( 352 ) 4,148 Total available-for-sale securities $ 1,199,677 $ 2,232 $ ( 128,235 ) $ 1,073,674 December 31, 2024 Obligations of: U.S. Treasury and government agencies $ 15,317 $ 87 $ ( 208 ) $ 15,196 U.S. government sponsored agencies 224,167 53 ( 15,137 ) 209,083 States and political subdivisions 225,074 16 ( 28,789 ) 196,301 Residential mortgage-backed securities 693,886 1,391 ( 93,475 ) 601,802 Commercial mortgage-backed securities 64,438 36 ( 9,409 ) 55,065 Bank-issued trust preferred securities 6,500 — ( 392 ) 6,108 Total available-for-sale securities $ 1,229,382 $ 1,583 $ ( 147,410 ) $ 1,083,555 13 Table of Contents The gross gains and losses realized by Peoples from sales or prepayments of available-for-sale securities for the periods ended March 31 were as follows: Three Months Ended March 31, (Dollars in thousands) 2025 2024 Gross gains realized $ 25 $ — Gross losses realized 27 1 Net loss realized $ ( 2 ) $ ( 1 ) The cost of investment securities sold, and any resulting gain or loss, were based on the specific identification method and recognized as of the trade date. The following table presents a summary of available-for-sale investment securities that have been in a continuous unrealized loss position for the periods identified: Less than 12 Months 12 Months or More Total (Dollars in thousands) Fair Value Unrealized Loss No. of Securities Fair Value Unrealized Loss No. of Securities Fair Value Unrealized Loss March 31, 2025 Obligations of: U.S. Treasury and government agencies $ 12,281 $ 46 8 $ 2,062 $ 15 9 $ 14,343 $ 61 U.S. government sponsored agencies 141,400 3,090 23 71,663 7,671 13 213,063 10,761 States and political subdivisions 30,058 910 35 165,447 26,949 154 195,505 27,859 Residential mortgage-backed securities 116,813 1,313 54 477,184 80,237 255 593,997 81,550 Commercial mortgage-backed securities 8,369 73 6 44,267 7,579 23 52,636 7,652 Bank-issued trust preferred securities — — — 3,648 352 2 3,648 352 Total $ 308,921 $ 5,432 126 $ 764,271 $ 122,803 456 $ 1,073,192 $ 128,235 December 31, 2024 Obligations of: U.S. Treasury and government agencies $ 10,003 $ 174 11 $ 2,299 $ 34 10 $ 12,302 $ 208 U.S. government sponsored agencies 130,518 5,816 27 70,982 9,321 13 201,500 15,137 States and political subdivisions 28,400 1,188 55 160,210 27,601 138 188,610 28,789 Residential mortgage-backed securities 85,043 2,300 69 482,609 91,175 256 567,652 93,475 Commercial mortgage-backed securities 2,868 93 5 46,619 9,316 24 49,487 9,409 Bank-issued trust preferred securities 493 7 1 5,614 385 3 6,107 392 Total $ 257,325 $ 9,578 168 $ 768,333 $ 137,832 444 $ 1,025,658 $ 147,410 Management evaluates available-for-sale investment securities for an allowance for credit losses on a quarterly basis. At March 31, 2025, management concluded that no individual securities at an unrealized loss position required an allowance for credit losses. At March 31, 2025, Peoples did not have the intent to sell, nor was it more likely than not that Peoples would be required to sell, any of the securities with an unrealized loss prior to recovery. Further, the unrealized losses at both March 31, 2025 and December 31, 2024 were attributable to changes in market interest rates and spreads since the securities were purchased, and were not credit-related losses. The unrealized loss with respect to the two bank-issued trust preferred securities that had been in an unrealized loss position for 12 months or more at March 31, 2025 was attributable to the subordinated nature of the trust preferred securities. 14 Table of Contents The table below presents the amortized cost, fair value and total weighted-average yield of available-for-sale securities by contractual maturity at March 31, 2025. The weighted-average yields are based on the amortized cost. In some cases, the issuers may have the right to call or prepay obligations without call or prepayment penalties prior to the contractual maturity date. (Dollars in thousands) Within 1 Year 1 to 5 Years 5 to 10 Years Over 10 Years Total Amortized cost Obligations of: U.S. Treasury and government agencies $ 1,036 $ 1,270 $ 6,498 $ 5,446 $ 14,250 U.S. government sponsored agencies 1,490 67,658 72,103 82,334 223,585 States and political subdivisions 7,982 39,143 79,366 96,834 223,325 Residential mortgage-backed securities 6 4,110 52,483 617,131 673,730 Commercial mortgage-backed securities 452 10,607 26,047 23,181 60,287 Bank-issued trust preferred securities — 1,500 3,000 — 4,500 Total available-for-sale securities $ 10,966 $ 124,288 $ 239,497 $ 824,926 $ 1,199,677 Fair value Obligations of: U.S. Treasury and government agencies $ 1,034 $ 1,266 $ 6,609 $ 5,434 $ 14,343 U.S. government sponsored agencies 1,453 62,924 70,186 78,500 213,063 States and political subdivisions 7,936 37,015 67,795 82,759 195,505 Residential mortgage-backed securities 6 4,025 49,051 540,897 593,979 Commercial mortgage-backed securities 452 9,884 22,508 19,792 52,636 Bank-issued trust preferred securities — 1,463 2,685 — 4,148 Total available-for-sale securities $ 10,881 $ 116,577 $ 218,834 $ 727,382 $ 1,073,674 Total weighted-average yield 2.93 % 2.30 % 2.97 % 2.76 % 2.76 % Held-to-maturity The following table summarizes Peoples’ held-to-maturity investment securities: (Dollars in thousands) Amortized Cost Allowance for Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value March 31, 2025 Obligations of: U.S. government sponsored agencies $ 222,698 $ — $ 532 $ ( 7,853 ) $ 215,377 States and political subdivisions 142,513 ( 237 ) 125 ( 29,930 ) 112,471 Residential mortgage-backed securities 290,023 — 1,085 ( 19,312 ) 271,796 Commercial mortgage-backed securities 98,469 — — ( 14,798 ) 83,671 Total held-to-maturity investment securities $ 753,703 $ ( 237 ) $ 1,742 $ ( 71,893 ) $ 683,315 December 31, 2024 Obligations of: U.S. government sponsored agencies $ 233,302 $ — $ 219 $ ( 10,227 ) $ 223,294 States and political subdivisions 142,691 ( 237 ) 110 ( 31,716 ) 110,848 Residential mortgage-backed securities 300,290 — 281 ( 24,293 ) 276,278 Commercial mortgage-backed securities 98,754 — — ( 16,675 ) 82,079 Total held-to-maturity investment securities $ 775,037 $ ( 237 ) $ 610 $ ( 82,911 ) $ 692,499 There were no sales of held-to-maturity investment securities during the periods ended March 31, 2025 or December 31, 2024. Management evaluates held-to-maturity investment securities for an allowance for credit losses on a quarterly basis. The majority of People's held-to maturity investment securities are mortgage-backed securities, for which an allowance for credit losses was not recorded. Peoples calculated the allowance for credit losses for state and political subdivisions using cumulative default rate averages for municipal securities. Peoples reported $ 0.2 million of allowance for credit losses for held-to-maturity securities at both March 31, 2025, and December 31, 2024. The following table presents a summary of held-to-maturity investment securities that had been in a continuous unrealized loss position for the periods identified: 15 Table of Contents Less than 12 Months 12 Months or More Total (Dollars in thousands) Fair Value Unrealized Loss No. of Securities Fair Value Unrealized Loss No. of Securities Fair Value Unrealized Loss March 31, 2025 Obligations of: U.S. government sponsored agencies $ 178,241 $ 947 20 $ 37,136 $ 6,906 10 $ 215,377 $ 7,853 States and political subdivisions 1,228 76 1 108,357 29,854 66 109,585 29,930 Residential mortgage-backed securities 140,441 1,030 16 131,355 18,282 43 271,796 19,312 Commercial mortgage-backed securities 8,764 109 2 74,908 14,689 32 83,672 14,798 Total $ 328,674 $ 2,162 39 $ 351,756 $ 69,731 151 $ 680,430 $ 71,893 December 31, 2024 Obligations of: U.S. government sponsored agencies $ 150,390 $ 2,464 29 $ 38,901 $ 7,763 11 $ 189,291 $ 10,227 States and political subdivisions 957 44 1 106,716 31,672 66 107,673 31,716 Residential mortgage-backed securities 116,576 2,808 27 130,556 21,485 43 247,132 24,293 Commercial mortgage-backed securities 9,603 1,381 5 70,476 15,294 29 80,079 16,675 Total $ 277,526 $ 6,697 62 $ 346,649 $ 76,214 149 $ 624,175 $ 82,911 The table below presents the amortized cost, fair value and total weighted-average yield of held-to-maturity investment securities by contractual maturity at March 31, 2025. The weighted-average yields are based on the amortized cost and are computed on a fully taxable-equivalent basis using a blended federal and state corporate income tax rate of 23.3 % at March 31, 2025. In some cases, the issuers may have the right to call or prepay obligations without call or prepayment penalties prior to the contractual maturity date. (Dollars in thousands) Within 1 Year 1 to 5 Years 5 to 10 Years Over 10 Years Total Amortized cost Obligations of: U.S. government sponsored agencies $ 2,935 $ 3,498 $ 76,118 $ 140,147 $ 222,698 States and political subdivisions 2,798 5,830 22,131 111,754 142,513 Residential mortgage-backed securities — 147 3,811 286,065 290,023 Commercial mortgage-backed securities 2,000 10,838 34,108 51,523 98,469 Total held-to-maturity investment securities $ 7,733 $ 20,313 $ 136,168 $ 589,489 $ 753,703 Fair value Obligations of: U.S. government sponsored agencies $ 2,853 $ 3,347 $ 75,883 $ 133,294 $ 215,377 States and political subdivisions 2,790 5,614 18,188 85,879 112,471 Residential mortgage-backed securities — 146 3,411 268,239 271,796 Commercial mortgage-backed securities 2,000 9,964 29,780 41,927 83,671 Total held-to-maturity investment securities $ 7,643 $ 19,071 $ 127,262 $ 529,339 $ 683,315 Total weighted-average yield 1.79 % 1.90 % 3.79 % 3.94 % 3.83 % 16 Table of Contents Other Investment Securities Peoples' other investment securities on the Unaudited Consolidated Balance Sheets consist largely of shares of FHLB stock and of FRB stock. The following table summarizes the carrying value of Peoples' other investment securities: (Dollars in thousands) March 31, 2025 December 31, 2024 FHLB stock $ 14,797 $ 24,606 FRB stock 27,114 27,114 Nonqualified deferred compensation 5,164 4,898 Equity investment securities 3,378 2,645 Other investment securities 869 869 Total other investment securities $ 51,322 $ 60,132 During the three months ended March 31, 2025, Peoples redeemed $ 11.4 million of FHLB stock in order to be in compliance with the requirements of the FHLB. Peoples purchased $ 1.6 million of additional FHLB stock during the three months ended March 31, 2025, as a result of the FHLB's capital requirements on FHLB advances. For the three months ended March 31, 2025 and 2024, Peoples recorded the change in the fair value of equity investment securities held during the period in "Other non-interest income", resulting in an unrealized loss of $ 9,000 and an unrealized gain of $ 47,000 , respectively. At March 31, 2025, Peoples' investment in equity investment securities was comprised largely of common stocks issued by various unrelated bank holding companies. There were no equity investment securities of a single issuer that exceeded 10% of Peoples' stockholders' equity at March 31, 2025. Pledged Securities Peoples has pledged available-for-sale investment securities and held-to-maturity investment securities to secure public and trust department deposits, and repurchase agreements in accordance with federal and state requirements. Peoples has also pledged available-for-sale investment securities to secure additional borrowing capacity at the FHLB and the FRB. The following table summarizes the carrying amount of Peoples' pledged securities: Carrying Amount (Dollars in thousands) March 31, 2025 December 31, 2024 Securing public and trust department deposits, and repurchase agreements: Available-for-sale $ 547,471 $ 505,963 Held-to-maturity 627,605 563,014 Securing additional borrowing capacity at the FHLB and the FRB: Available-for-sale 3,116 3,119 Held-to-maturity 1,208 1,215 Accrued Interest Accrued interest receivable is not included in investment securities balances, and is presented in the “Other assets” line of the Unaudited Consolidated Balance Sheets, with no recorded allowance for credit losses. Interest receivable on investment securities was $ 10.9 million at March 31, 2025 and $ 9.9 million at December 31, 2024. Note 4 Loans and Leases Peoples' loan portfolio consists of various types of loans and leases originated primarily as a result of lending opportunities within Peoples' footprint. Peoples also originates insurance premium finance loans nationwide through its Peoples Premium Finance division, and originates leases nationwide through its North Star Leasing ("NSL") division and its Vantage Financial, LLC ("Vantage") subsidiary. 17 Table of Contents The major classifications of loan balances (in each case, net of deferred fees and costs) excluding loans held for sale, were as follows: (Dollars in thousands) March 31, 2025 December 31, 2024 Construction $ 319,104 $ 328,388 Commercial real estate, other 2,230,538 2,156,013 Commercial and industrial 1,343,827 1,347,645 Premium finance 264,080 269,435 Leases 395,454 406,598 Residential real estate 848,168 835,101 Home equity lines of credit 235,409 232,661 Consumer, indirect 680,260 669,857 Consumer, direct 110,639 111,052 Deposit account overdrafts 1,047 1,253 Total loans, at amortized cost $ 6,428,526 $ 6,358,003 The table above includes net deferred loan origination costs of $ 20.4 million and $ 20.2 million at March 31, 2025 and at December 31, 2024, respectively. The remaining unamortized net discount included in the amortized cost of loans and leases was $ 15.8 million and $ 19.5 million at March 31, 2025 and at December 31, 2024, respectively. Accrued interest receivable is not included within the loan balances, but is presented in the “Other assets” line of the Unaudited Consolidated Balance Sheets, with no recorded allowance for credit losses. Total interest receivable on loans was $ 24.1 million at March 31, 2025 and $ 23.1 million at December 31, 2024. Nonaccrual and Past Due Loans A loan is considered past due if any required principal and interest payments have not been received as of the date such payments were required to be made under the terms of the loan agreement. A loan may be placed on nonaccrual status regardless of whether or not such loan is considered past due. The amortized cost of loans on nonaccrual status and of loans delinquent for 90 days or more and accruing was as follows: March 31, 2025 December 31, 2024 (Dollars in thousands) Nonaccrual (a) Accruing Loans 90+ Days Past Due Nonaccrual (a) Accruing Loans 90+ Days Past Due Commercial real estate, other 5,378 284 7,136 227 Commercial and industrial 5,747 106 6,809 78 Premium finance — 2,502 — 4,947 Leases 12,079 218 8,850 803 Residential real estate 8,163 853 7,329 2,166 Home equity lines of credit 1,537 47 1,498 213 Consumer, indirect 2,521 77 2,374 159 Consumer, direct 203 120 133 44 Total loans, at amortized cost $ 35,628 $ 4,207 $ 34,129 $ 8,637 (a) There were $ 2.6 million of nonaccrual loans for which there was no allowance for credit losses at March 31, 2025 and $ 5.7 million of nonaccrual loans for which there was no allowance for credit losses at December 31, 2024. 18 Table of Contents During the first three months of 2025, nonaccrual loans in creased compared to at December 31, 2024, which was primarily due to an uptick in the volume of leases placed on nonaccrual during the quarter, partially offset by improvements in commercial real estate loans and commercial and industrial loans. The decrease in accruing loans 90+ days past due at March 31, 2025, when compared to at December 31, 2024, was primarily due to reductions in accruing 90+ days past due premium finance loans and residential real estate loans of $ 2.4 million and $ 1.3 million, respectively. The delinquent premium finance loans carry low credit risk, due to the ability to cancel premiums and recover the majority of the receivable from the insurer. The following table presents the aging of the amortized cost of past due loans: Loans Past Due Current Loans Total Loans (Dollars in thousands) 30 - 59 days 60 - 89 days 90 + Days Total March 31, 2025 Construction $ — $ — $ — $ — $ 319,104 $ 319,104 Commercial real estate, other 1,967 2,605 2,544 7,116 2,223,422 2,230,538 Commercial and industrial 1,119 1,587 3,740 6,446 1,337,381 1,343,827 Premium finance 2,005 1,816 2,502 6,323 257,757 264,080 Leases 31,007 3,260 11,565 45,832 349,622 395,454 Residential real estate 10,129 2,306 4,005 16,440 831,728 848,168 Home equity lines of credit 1,430 357 865 2,652 232,757 235,409 Consumer, indirect 6,486 803 1,287 8,576 671,684 680,260 Consumer, direct 514 149 208 871 109,768 110,639 Deposit account overdrafts — — — — 1,047 1,047 Total loans, at amortized cost $ 54,657 $ 12,883 $ 26,716 $ 94,256 $ 6,334,270 $ 6,428,526 December 31, 2024 Construction $ — $ — $ — $ — $ 328,388 $ 328,388 Commercial real estate, other 1,300 1,585 6,008 8,893 2,147,120 2,156,013 Commercial and industrial 1,651 583 4,551 6,785 1,340,860 1,347,645 Premium finance 3,863 456 4,947 9,266 260,169 269,435 Leases 10,941 5,241 9,575 25,757 380,841 406,598 Residential real estate 11,481 3,038 5,271 19,790 815,311 835,101 Home equity lines of credit 1,473 317 1,093 2,883 229,778 232,661 Consumer, indirect 7,568 1,522 1,326 10,416 659,441 669,857 Consumer, direct 884 113 138 1,135 109,917 111,052 Deposit account overdrafts — — — — 1,253 1,253 Total loans, at amortized cost $ 39,161 $ 12,855 $ 32,909 $ 84,925 $ 6,273,078 $ 6,358,003 Delinquency trends increased slightly, as 98.5 % of Peoples' loan portfolio was considered “current” at March 31, 2025, compared to 98.7 % at December 31, 2024. Pledged Loans Peoples has pledged certain loans secured by one-to-four family and multifamily residential mortgages, home equity lines of credit and commercial real estate loans under a blanket collateral agreement to secure borrowings from the FHLB. Peoples also has pledged eligible commercial and industrial loans to secure borrowings with the FRB. Loans pledged are summarized as follows: (Dollars in thousands) March 31, 2025 December 31, 2024 Loans pledged to FHLB $ 1,205,884 $ 1,218,496 Loans pledged to FRB 604,590 527,989 Credit Quality Indicators As discussed in "Note 1 Summary of Significant Accounting Policies" of the Notes to the Consolidated Financial Statements included in Peoples' 2024 Form 10-K, Peoples categorizes the majority of its loans into risk categories based upon an established risk grading matrix using a scale of 1 to 8. Loan grades are assigned at the time a new loan or lending commitment is extended by Peoples and may be changed at any time when circumstances warrant. Commercial loans to borrowers with an aggregate unpaid principal balance in excess of $ 1.0 million are reviewed at least on an annual basis for possible credit deterioration. Commercial leases, as well as loan relationships whose aggregate credit exposure to Peoples is equal to or less than $ 1.0 million, are reviewed on an event driven basis. Triggers for review include knowledge of adverse events affecting the borrower's business, receipt of financial statements 19 Table of Contents indicating deteriorating credit quality or other similar events. Adversely classified loans are reviewed on a quarterly basis. A description of the general characteristics of the risk grades used by Peoples, follows: “Pass” (grades 1 through 4): Loans in this risk category involve borrowers of acceptable-to-strong credit quality and risk who have the apparent ability to satisfy their loan obligations. Loans in this risk category would possess sufficient mitigating factors, such as adequate collateral or strong guarantors possessing the capacity to repay the loan if required, for any weakness that may exist. “Special Mention” (grade 5): Loans in this risk grade are the equivalent of the regulatory definition of “Other Assets Especially Mentioned.” Loans in this risk category possess some credit deficiency or potential weakness, which requires a high level of management attention. Potential weaknesses include declining trends in operating earnings and cash flows and/or reliance on a secondary source of repayment. If left uncorrected, these potential weaknesses may result in noticeable deterioration of the repayment prospects for the loan or in Peoples' credit position. “Substandard” (grade 6): Loans in this risk grade are inadequately protected by the borrower's current financial condition and payment capability or the collateral pledged, if any. Loans so classified have one or more well-defined weaknesses that jeopardize the orderly repayment of the loans. They are characterized by the distinct possibility that Peoples will sustain some loss if the weaknesses are not corrected. “Doubtful” (grade 7): Loans in this risk grade have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or orderly repayment in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable. Possibility of loss is extremely high, but because of certain important and reasonably specific factors that may work to the advantage and strengthening of the exposure, classification of each of these loans as an estimated loss is deferred until its more exact status may be determined. “Loss” (grade 8): Loans in this risk grade are considered to be non-collectible and of such little value that their continuance as bankable assets is not warranted. This does not mean a loan has absolutely no recovery value, but rather it is neither practical nor desirable to defer writing off the loan, even though partial recovery may be obtained in the future. Charge-offs against the allowance for credit losses are taken during the period in which the loan becomes uncollectible. Consequently, Peoples typically does not maintain a recorded investment in loans within this category. Consumer loans and other smaller-balance loans are evaluated and categorized as "substandard," "doubtful" or "loss" based upon the regulatory definition of these classes and consistent with regulatory requirements. Leases are categorized as "special mention", "substandard", or "loss" based upon delinquency status and the prospect of collecting the remaining net investment balance owed under the lease. All other loans not evaluated individually, nor meeting the regulatory conditions to be categorized as described above, would be considered as being "not rated." The following table summarizes the risk category of loans within Peoples' loan portfolio, including acquired loans, based upon the most recent analysis performed at March 31, 2025: Term Loans at Amortized Cost by Origination Year Revolving Loans Converted to Term (Dollars in thousands) 2025 2024 2023 2022 2021 Prior Revolving Loans Total Loans Construction Pass $ 7,760 $ 90,100 $ 170,833 $ 34,732 $ 6,762 $ 6,133 $ — $ 234 $ 316,320 Special mention — — — — — 113 — — 113 Substandard — — 1,149 1,522 — — — — 2,671 Total 7,760 90,100 171,982 36,254 6,762 6,246 — 234 319,104 Current period gross charge-offs — — — — — — — Commercial real estate, other Pass 93,323 148,818 276,560 389,546 398,581 765,684 44,974 2,275 2,117,486 Special mention — 416 2,150 7,361 10,834 25,438 285 54 46,484 Substandard — 144 1,654 5,633 11,770 44,743 724 2,476 64,668 Doubtful — — — — — 1,898 — — 1,898 Loss — — — — — 2 — — 2 Total 93,323 149,378 280,364 402,540 421,185 837,765 45,983 4,805 2,230,538 Current period gross charge-offs — — — 156 — 59 215 20 Table of Contents Term Loans at Amortized Cost by Origination Year Revolving Loans Converted to Term (Dollars in thousands) 2025 2024 2023 2022 2021 Prior Revolving Loans Total Loans Commercial and industrial Pass 38,053 287,732 201,501 125,281 137,844 237,175 235,900 2,130 1,263,486 Special mention — 760 9,005 9,440 4,132 1,795 27,397 5,500 52,529 Substandard — 272 248 5,504 8,192 6,491 4,938 148 25,645 Doubtful — — — 2,015 — 152 — 100 2,167 Total 38,053 288,764 210,754 142,240 150,168 245,613 268,235 7,878 1,343,827 Current period gross charge-offs — — — — 49 331 380 Premium Finance Pass 120,789 140,876 2,361 54 — — — — 264,080 Total 120,789 140,876 2,361 54 — — — — 264,080 Current period gross charge-offs — 33 14 24 — — 71 Leases Pass 42,962 140,613 116,131 53,851 21,147 5,716 — — 380,420 Special mention — 742 2,118 572 137 3 — — 3,572 Substandard — 2,201 2,765 2,183 583 113 — — 7,845 Doubtful — 336 1,980 1,136 52 113 — — 3,617 Total 42,962 143,892 122,994 57,742 21,919 5,945 — — 395,454 Current period gross charge-offs — 191 1,938 2,690 574 261 5,654 Residential real estate Pass 20,021 76,315 64,708 83,506 125,460 466,807 — — 836,817 Substandard — 167 835 260 985 9,069 — — 11,316 Loss — 5 7 9 — 14 — — 35 Total 20,021 76,487 65,550 83,775 126,445 475,890 — — 848,168 Current period gross charge-offs — — 27 — 54 61 142 Home equity lines of credit Pass 8,555 55,513 35,860 37,688 26,717 69,940 23 3,407 234,296 Substandard — — 106 296 16 688 — — 1,106 Loss — — — — — 7 — — 7 Total 8,555 55,513 35,966 37,984 26,733 70,635 23 3,407 235,409 Current period gross charge-offs — — — — — — — Consumer, indirect Pass 77,083 225,426 158,529 130,515 47,959 37,984 — — 677,496 Substandard — 433 581 727 516 472 — — 2,729 Loss — 1 2 8 15 9 — — 35 Total 77,083 225,860 159,112 131,250 48,490 38,465 — — 680,260 Current period gross charge-offs 14 635 637 388 134 58 1,866 Consumer, direct Pass 19,982 33,921 22,842 18,622 8,124 6,840 — — 110,331 21 Table of Contents Term Loans at Amortized Cost by Origination Year Revolving Loans Converted to Term (Dollars in thousands) 2025 2024 2023 2022 2021 Prior Revolving Loans Total Loans Substandard — 38 76 87 29 68 — — 298 Loss — 2 1 6 — 1 — — 10 Total 19,982 33,961 22,919 18,715 8,153 6,909 — — 110,639 Current period gross charge-offs 11 48 23 57 9 7 155 Deposit account overdrafts 1,047 — — — — — — — 1,047 Current period gross charge-offs 277 — — — — — 277 Total loans, at amortized cost 429,575 1,204,831 1,072,002 910,554 809,855 1,687,468 314,241 16,324 6,428,526 Total current period gross charge-offs $ 302 $ 907 $ 2,639 $ 3,315 $ 820 $ 777 $ 8,760 The following table summarizes the risk category of loans within Peoples' loan portfolio, including acquired loans, based upon the then most recent analysis performed at December 31, 2024: Term Loans at Amortized Cost by Origination Year (Dollars in thousands) 2024 2023 2022 2021 2020 Prior Revolving Loans Revolving Loans Converted to Term Total Loans Construction Pass $ 69,862 $ 162,605 $ 47,133 $ 30,592 $ 1,845 $ 13,540 $ — $ — $ 325,577 Special mention — — — — — 115 — — 115 Substandard — 1,161 1,535 — — — — — 2,696 Total 69,862 163,766 48,668 30,592 1,845 13,655 — — 328,388 Current period gross charge-offs — — — — — — — Commercial real estate, other Pass 130,971 219,105 366,256 337,905 201,367 751,415 41,122 — 2,048,141 Special mention 271 2,923 11,876 7,197 5,107 10,689 288 — 38,351 Substandard 145 1,073 2,460 18,851 9,234 37,136 612 — 69,511 Doubtful — — — — — 10 — — 10 Total 131,387 223,101 380,592 363,953 215,708 799,250 42,022 — 2,156,013 Current period gross charge-offs — — 376 — — 55 431 Commercial and industrial Pass 311,631 202,929 134,558 148,288 66,102 152,143 229,821 4,779 1,245,472 Special mention 779 9,019 10,886 4,449 12,049 13,537 19,465 — 70,184 Substandard 200 99 4,791 11,429 3,850 4,430 5,045 49 29,844 Doubtful — — 1,987 — — 158 — — 2,145 Total 312,610 212,047 152,222 164,166 82,001 170,268 254,331 4,828 1,347,645 Current period gross charge-offs — 14 — 17 105 532 668 Premium finance Pass 265,504 3,837 94 — — — — — 269,435 Total 265,504 3,837 94 — — — — — 269,435 Current period gross charge-offs 67 109 33 — — — 209 22 Table of Contents Term Loans at Amortized Cost by Origination Year (Dollars in thousands) 2024 2023 2022 2021 2020 Prior Revolving Loans Revolving Loans Converted to Term Total Loans Leases Pass 175,449 125,664 61,064 24,181 4,661 2,153 — — 393,172 Special mention 791 1,529 1,140 365 5 — — — 3,830 Substandard 351 2,108 1,777 193 8 — — — 4,437 Doubtful 170 2,127 1,859 624 110 269 — — 5,159 Total 176,761 131,428 65,840 25,363 4,784 2,422 — — 406,598 Current period gross charge-offs 1,315 5,623 5,421 2,308 301 138 15,106 Residential real estate Pass 77,130 66,712 85,045 128,359 52,090 414,574 — — 823,910 Substandard 321 1,088 161 980 306 8,087 — — 10,943 Loss — 4 — — — 244 — — 248 Total 77,451 67,804 85,206 129,339 52,396 422,905 — — 835,101 Current period gross charge-offs — — 46 5 — 237 288 Home equity lines of credit Pass 54,724 37,417 37,752 27,430 16,583 57,303 24 731 231,233 Substandard — 138 163 16 34 1,069 — — 1,420 Loss — — — — — 8 — — 8 Total 54,724 37,555 37,915 27,446 16,617 58,380 24 731 232,661 Current period gross charge-offs — — — — — 11 11 Consumer, indirect Pass 239,584 176,115 148,210 56,846 30,231 16,129 — — 667,115 Substandard 269 557 681 618 312 251 — — 2,688 Loss 14 — 16 14 — 10 — — 54 Total 239,867 176,672 148,907 57,478 30,543 16,390 — — 669,857 Current period gross charge-offs 497 2,207 1,880 691 141 763 6,179 Consumer, direct Pass 45,978 25,605 21,544 9,614 4,180 3,884 — — 110,805 Substandard 18 65 46 29 4 73 — — 235 Loss — 4 — — — 8 — — 12 Total 45,996 25,674 21,590 9,643 4,184 3,965 — — 111,052 Current period gross charge-offs 2 154 212 51 12 247 678 Deposit account overdrafts 1,253 — — — — — — — 1,253 Current period gross charge-offs 1,542 $ — $ — $ — $ — $ — 1,542 Total loans, at amortized cost 1,375,415 1,041,884 941,034 807,980 408,078 1,487,235 296,377 5,559 6,358,003 Current period gross charge-offs $ 3,423 $ 8,107 $ 7,968 $ 3,072 $ 559 $ 1,983 $ 25,112 23 Table of Contents Collateral Dependent Loans Peoples has certain loans for which repayment is dependent upon the operation or sale of collateral, as the borrower is experiencing financial difficulty. The underlying collateral can vary based upon the type of loan. The following provides more detail about the types of collateral that secure collateral dependent loans: • Construction loans are typically secured by owner occupied commercial real estate or non-owner occupied investment real estate. Typically, owner occupied construction loans are secured by office buildings, warehouses, manufacturing facilities, and other commercial and industrial properties that are in process of construction. Non-owner occupied commercial construction loans are generally secured by multi-family complexes, warehouse buildings, industrial buildings, land under development, and other commercial real estate in process of construction. • Commercial real estate loans can be secured by either owner occupied commercial real estate or non-owner occupied investment commercial real estate. Typically, owner occupied commercial real estate loans are secured by office buildings, warehouses, manufacturing facilities, and other commercial and industrial properties occupied by operating companies. Non-owner occupied commercial real estate loans are generally secured by multifamily complexes, retail facilities, office buildings and complexes, warehouses, industrial buildings, land under development, as well as other commercial real estate. • Commercial and industrial loans are generally secured by equipment, inventory, accounts receivable, and other commercial property. • Residential real estate loans are typically secured by first mortgages, and in some cases could be secured by a second mortgage, on residential real estate property. • Home equity lines of credit are generally secured by second mortgages on residential real estate property. • Consumer loans are generally secured by automobiles, motorcycles, recreational vehicles and other personal property. Some consumer loans are unsecured and have no underlying collateral. • Leases are most often secured by commercial equipment and other essential business assets. • Premium finance loans are secured by the unearned portion of the insurance premium being financed. The following table details Peoples' amortized cost of collateral dependent loans: (Dollars in thousands) March 31, 2025 December 31, 2024 Commercial real estate, other $ 1,887 $ 2,764 Leases 1,789 652 Commercial and industrial — 959 Total collateral dependent loans $ 3,676 $ 4,375 The decrease in collateral dependent loans at March 31, 2025, compared to December 31, 2024, was primarily driven by the payoff of one commercial real estate loan and one commercial and industrial loan, which in aggregate totaled approximately $ 3.0 million. This was partially offset by collateral dependent leases added during the first quarter. Modifications for Borrowers Experiencing Financial Difficulty As part of Peoples' loss mitigation activities, Peoples may agree to modify the contractual terms of a loan to a borrower experiencing financial difficulty. The most common modifications to the contractual terms of a loan to a borrower experiencing financial difficulty include an extension of the maturity date, a reduction in the interest rate for the remaining life of the loan, a temporary period of interest-only payments, and a reduction in the contractual payment amount for either a short period or the remaining term of the loan. In addition to loan modifications, Peoples also provides other loss mitigation options, such as forbearance and repayment plans, to assist borrowers who experience financial difficulties. In assessing whether or not a borrower is experiencing financial difficulty, Peoples considers information currently available regarding the financial condition of the borrower. This information includes, but is not limited to, whether (1) the borrower is currently in payment default on any of the borrower's debt; (2) a payment default is probable in the foreseeable future without the modification; (3) the borrower has declared or is in the process of declaring bankruptcy; and (4) the borrower's projected cash flow is insufficient to satisfy contractual payments due under the original terms of the loan without a modification. The following tables display the amortized cost of loans that were restructured during the three months ended March 31, 2025 and March 31, 2024, presented by loan classification. 24 Table of Contents Payment Delay (Only) (Dollars in thousands) Payment Deferral Term Extension Principal Forgiveness Total Percentage of Total by Loan Category (a)(b)(c) During the Three Months Ended March 31, 2025 Commercial real estate $ — $ 2,445 — $ 2,445 0.11 % Commercial and industrial — 5,646 — 5,646 0.42 % Leasing 12 — 68 80 0.02 % Total $ 12 $ 8,091 $ 68 $ 8,171 0.13 % During the Three Months Ended March 31, 2024 Commercial real estate — 565 — 565 0.03 % Commercial and industrial — 10,203 — 10,203 0.84 % Leasing 25 — — 25 0.01 % Residential real estate — 76 — 76 0.01 % Total $ 25 $ 10,844 $ — $ 10,869 0.18 % (a) Based on the amortized cost basis as of period end, divided by the period end amortized cost basis of the corresponding class of financing receivable. (b) The table presented above excludes loans that were paid off or otherwise no longer included in the loan portfolio as of period end. (c) Each with --% not meaningful The following tables summarize the financial impacts of loan modifications and payment deferrals made to loans during the three months ended March 31, 2025 and March 31, 2024, presented by loan classification. Weighted-Average Term Extension (in months) During the Three Months Ended March 31, 2025 Commercial real estate 3 Commercial and industrial 8 During the Three Months Ended March 31, 2024 Commercial real estate 6 Commercial and industrial 6 Leasing 9 Residential real estate 2 The following tables display the amortized cost of loans that received a completed modification or payment deferral within the previous 12 months and that had a payment default in the periods presented. For purposes of this disclosure, Peoples defines loans that had a payment default as loans that were 90 days or more past due following a modification. 25 Table of Contents Term Extension (a) For the Three Months Ended March 31, 2025 Commercial and industrial 117 Leasing 638 Total loans that subsequently defaulted $ 755 For the Three Months Ended March 31, 2024 Commercial and industrial 648 Total loans that subsequently defaulted $ 648 (a) Represents the sum of amortized cost and gross charge-off as of period end. Excludes loans that liquidated either through foreclosure, deed-in-lieu of foreclosure, or a short sale. The following table displays an aging analysis of loans that were modified during the 12 months prior to March 31, 2025 and March 31, 2024, respectively, presented by classification and class of financing receivable. As of March 31, 2025 (Dollars in thousands) 30-59 Days Delinquent 60-89 Days Delinquent 90+ Days Delinquent Total Delinquent Current Total Commercial real estate 1,058 69 — 1,127 1,887 3,014 Commercial and industrial — — 117 117 7,789 7,906 Leasing 300 — 638 938 250 1,188 Residential real estate — — — — 15 15 Home equity lines of credit — — — — 158 158 Consumer, indirect — — 12 12 — 12 Total loans modified (a) $ 1,358 $ 69 $ 767 $ 2,194 $ 10,099 $ 12,293 (a) Represents the amortized cost basis as of period end. As of March 31, 2024 (Dollars in thousands) 30-59 Days Delinquent 60-89 Days Delinquent 90+ Days Delinquent Total Delinquent Current Total Construction $ — $ — $ — $ — $ 70 $ 70 Commercial real estate 193 — — 193 2,443 2,636 Commercial and industrial — 667 648 1,315 12,752 14,067 Leasing — — — — 25 25 Residential real estate 76 — — 76 24 100 Home equity lines of credit — — — — 207 207 Total loans modified (a) $ 269 $ 667 $ 648 $ 1,584 $ 15,521 $ 17,105 (a) Represents the amortized cost basis as of period end. Allowance for Credit Losses As discussed in "Note 1 Summary of Significant Accounting Policies" of the Notes to the Consolidated Financial Statements included in Peoples' 2024 Form 10-K, Peoples estimates the allowance for credit losses using relevant available information, from both internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. In management's estimation of expected credit losses, Peoples uses a one-year reasonable and supportable period across all segments. Following the reasonable and supportable period, Peoples reverts the macroeconomic variables to their long run average over a four-quarter reversion period. 26 Table of Contents Changes in the allowance for credit losses for the three months ended March 31, 2025 and March 31, 2024 are summarized below: (Dollars in thousands) Beginning Balance, December 31, 2024 Initial Allowance for Acquired PCD Assets (Recovery of) Provision for Credit Losses (a) Charge-offs Recoveries Ending Balance, March 31, 2025 Construction $ 878 $ — $ 278 $ — $ — $ 1,156 Commercial real estate, other 16,256 — 1,110 ( 215 ) 4 17,155 Commercial and industrial 13,283 — ( 126 ) ( 380 ) 6 12,783 Premium finance 662 — 49 ( 71 ) 6 646 Leases 12,893 — 6,091 ( 5,654 ) 245 13,575 Residential real estate 6,491 — 388 ( 142 ) 49 6,786 Home equity lines of credit 1,792 — 71 — — 1,863 Consumer, indirect 8,576 — 1,776 ( 1,866 ) 210 8,696 Consumer, direct 2,396 — 213 ( 155 ) 20 2,474 Deposit account overdrafts 121 — 155 ( 277 ) 99 98 Total $ 63,348 $ — $ 10,005 $ ( 8,760 ) $ 639 $ 65,232 (a) Amount does not include the provision for the allowance for credit losses on unfunded commitments. (Dollars in thousands) Beginning Balance, December 31, 2023 Initial Allowance for Acquired PCD Assets Provision for (Recovery of) Credit Losses (a) Charge-offs Recoveries Ending Balance, March 31, 2024 Construction $ 699 $ — $ 2 $ — $ — $ 701 Commercial real estate, other 20,915 — 1,002 ( 212 ) 83 21,788 Commercial and industrial 10,490 — 319 ( 235 ) 7 10,581 Premium finance 484 — 169 ( 54 ) 8 607 Leases 10,850 — 3,097 ( 1,270 ) 212 12,889 Residential real estate 5,937 — ( 74 ) ( 80 ) 83 5,866 Home equity lines of credit 1,588 — 94 — 7 1,689 Consumer, indirect 8,590 — 1,101 ( 1,461 ) 71 8,301 Consumer, direct 2,343 — 153 ( 226 ) 9 2,279 Deposit account overdrafts 115 — 268 ( 336 ) 74 121 Total $ 62,011 $ — $ 6,131 $ ( 3,874 ) $ 554 $ 64,822 (a) Amount does not include the provision for the allowance for credit losses on unfunded commitments. During the first quarter of 2025, Peoples recorded a total provision for credit losses on loans of $ 10.0 million, which was a result of higher net charge-offs. Net charge-offs for the first quarter of 2025 were $ 8.1 million, primarily driven by our North Star Leasing division. The increase in the allowance for credit losses at March 31, 2025 when compared to at December 31, 2024 was attributable to a deterioration of macro-economic conditions used within the CECL model, an increase in reserves on individually analyzed loans, and loan growth. 27 Table of Contents During the first quarter of 2024, Peoples recorded a provision for credit losses of $ 6.1 million, which was driven by (i) a deterioration in macro-economic conditions used within the CECL model, (ii) an increase of reserves on individually analyzed loans and (iii) loan growth. Peoples had recorded an allowance for unfunded commitments of $ 2.2 million and $ 2.0 million as of March 31, 2025 and December 31, 2024, respectively. The allowance for unfunded commitments (also referred to as "unfunded commitment liability") is presented in the “Accrued expenses and other liabilities” line of the Unaudited Consolidated Balance Sheets. The change in the allowance for unfunded commitments is also reflected in the "Provision for (recovery of) credit losses" line of the Unaudited Consolidated Statements of Operations. Note 5 Goodwill and Other Intangible Assets Goodwill The following table details changes in the recorded amount of goodwill: For the Three Months Ended For the Year Ended (Dollars in thousands) March 31, 2025 December 31, 2024 Goodwill, beginning of period $ 363,199 $ 362,169 Goodwill recorded from acquisitions — 1,030 Goodwill, end of period $ 363,199 $ 363,199 Other Intangible Assets Other intangible assets were comprised of the following at March 31, 2025 , and at December 31, 2024 : (Dollars in thousands) Core Deposits Customer Relationships Indefinite-Lived Trade Names Total March 31, 2025 Gross intangibles $ 54,186 $ 38,470 $ 2,491 $ 95,147 Intangibles recorded from acquisitions — — — — Accumulated amortization ( 32,697 ) ( 26,754 ) — ( 59,451 ) Total acquisition-related intangibles $ 21,489 $ 11,716 $ 2,491 $ 35,696 Servicing rights 1,105 Non-compete agreements 99 Total other intangibles $ 36,900 December 31, 2024 Gross intangibles $ 54,186 $ 37,920 $ 2,491 $ 94,597 Intangibles recorded from acquisitions — 550 — 550 Accumulated amortization ( 31,545 ) ( 25,723 ) — ( 57,268 ) Total acquisition-related intangibles $ 22,641 $ 12,747 $ 2,491 $ 37,879 Servicing rights 1,216 Non-compete agreements 128 Total other intangibles $ 39,223 28 Table of Contents The following table details estimated aggregate future amortization of other intangible assets at March 31, 2025: (Dollars in thousands) Core Deposits Customer Relationships Non-Compete Agreements Total Remaining nine months of 2025 $ 3,456 $ 3,092 $ 83 $ 6,631 2026 3,736 3,036 16 $ 6,788 2027 3,043 2,188 — $ 5,231 2028 2,608 1,462 — $ 4,070 2029 2,359 971 — $ 3,330 Thereafter 6,287 967 — $ 7,254 Total $ 21,489 $ 11,716 $ 99 $ 33,304 The weighted average amortization period of other intangible assets is 7.6 years. Note 6 Deposits Peoples’ deposit balances were comprised of the following: (Dollars in thousands) March 31, 2025 December 31, 2024 Retail certificates of deposits ("CDs"): $100 or more $ 1,122,896 $ 1,092,261 Less than $100 843,082 829,154 Total Retail CDs 1,965,978 1,921,415 Interest-bearing deposit accounts 1,086,112 1,085,152 Savings accounts 895,677 866,959 Money market deposit accounts 967,331 878,254 Governmental deposit accounts 834,409 775,782 Brokered CDs 458,957 554,982 Total interest-bearing deposits 6,208,464 6,082,544 Non-interest-bearing deposits 1,526,285 1,507,661 Total deposits $ 7,734,749 $ 7,590,205 Uninsured deposits were $ 2.1 billion a t March 31, 2025 and $ 2.0 billion at December 31, 2024 . Uninsured deposit amounts are estimated based on the portion of the respective customer account balances that exceeded the FDIC limit of $250,000. Peoples pledges investment securities against certain governmental deposit accounts, which covered over $ 725.5 million and $ 656.9 million of the uninsured deposit balances at March 31, 2025 and at December 31, 2024, respectively . Uninsured time deposits are broken out below by time remaining until maturity. (Dollars in thousands) March 31, 2025 December 31, 2024 3 months or less $ 144,606 $ 180,405 Over 3 to 6 months 118,957 127,329 Over 6 to 12 months 117,076 91,197 Over 12 months 45,048 18,044 Total $ 425,687 $ 416,975 29 Table of Contents The contractual maturities of CDs for each of the next five years, including the remainder of 2025, and thereafter are as follows: (Dollars in thousands) Retail Brokered Total Remaining nine months ending December 31, 2025 $ 1,492,301 $ 292,800 $ 1,785,101 Year ending December 31, 2026 436,648 16,379 453,027 Year ending December 31, 2027 23,223 82,419 105,642 Year ending December 31, 2028 6,973 21,526 28,499 Year ending December 31, 2029 5,660 45,833 51,493 Thereafter 1,173 — 1,173 Total CDs $ 1,965,978 $ 458,957 $ 2,424,935 At March 31, 2025, Peoples had seven effective interest rate swaps, with an aggregate notional value of $ 65.0 million, all of which hedge interest payments on brokered CDs. The brokered CDs are expected to be extended every 90 days through the maturity dates of the swaps. Additional information regarding Peoples' interest rate swaps can be found in "Note 1 0 Derivative Financial Instruments." Note 7 Stockholders’ Equity The following table details the progression in Peoples’ common shares and treasury stock during the three months ended March 31, 2025: Common Shares Treasury Stock Shares at December 31, 2024 36,782,601 1,311,175 Changes related to stock-based compensation awards: Release of restricted common shares — 50,671 Cancellation of restricted common shares — 30,633 Grant of restricted common shares — ( 160,269 ) Grant of unrestricted common shares — — Purchase of treasury stock — 3,045 Disbursed out of treasury stock — ( 954 ) Common shares repurchased under share repurchase program — — Common shares issued under dividend reinvestment plan 12,506 — Common shares issued under compensation plan for Boards of Directors — ( 3,890 ) Common shares issued under employee stock purchase plan — ( 10,149 ) Shares at March 31, 2025 36,795,107 1,220,262 On January 28, 2021, Peoples' Board of Directors approved a share repurchase program authorizing Peoples to purchase up to an aggregate of $ 30.0 million of Peoples' outstanding common shares. As of March 31, 2025, Peoples had repurchased an aggregate of 471,307 common shares totaling $ 13.4 million under the share repurchase program. No common shares were repurchased during the first three months of 2025 and 100,905 common shares totaling $ 3.0 million were purchased in the first quarter of 2024. Under Peoples' Amended Articles of Incorporation, Peoples is authorized to issue up to 50,000 preferred shares, in one or more series, having such voting powers, designations, preferences, rights, qualifications, limitations and restrictions as designated by Peoples' Board of Directors. At March 31, 2025, Peoples had no preferred shares issued or outstanding. On January 20, 2025, Peoples' Board of Directors declared a quarterly cash dividend of $ 0.40 per common share, payable on February 17, 2025, to shareholders of record on February 3, 2025. On April 21, 2025, Peoples' Board of Directors declared a quarterly cash dividend of $ 0.41 per common share, payable on May 19, 2025, to shareholders of record on May 5, 2025. The following table details the cash dividends declared per common share during the first two quarters of 2025 and the comparable periods of 2024: 2025 2024 First quarter $ 0.40 $ 0.39 Second quarter 0.41 0.40 Total dividends declared $ 0.81 $ 0.79 Accumulated Other Comprehensive (Loss) Income The following table details the change in the components of Peoples’ accumulated other comprehensive (loss) income during the three months ended March 31, 2025: (Dollars in thousands) Unrealized (Loss) Gain on Securities Unrealized Gain on Cash Flow Hedges Accumulated Other Comprehensive (Loss) Income Balance, December 31, 2024 $ ( 111,829 ) $ 1,444 $ ( 110,385 ) Reclassification adjustments to net income: Realized loss on securities, net of tax 2 — 2 Realized loss on cash flow hedges, net of tax ( 326 ) ( 326 ) Other comprehensive income (loss), net of reclassifications and tax 15,199 ( 181 ) 15,018 Balance, March 31, 2025 $ ( 96,628 ) $ 937 $ ( 95,691 ) Note 8 Employee Benefit Plans Peoples maintains a retirement savings plan, or 401(k) plan, which covers substantially all employees. The plan provides participants with the opportunity to save for retirement on a tax-deferred basis or through Roth contributions. Since January 1, 2021, Peoples matches 100 % of participants’ contributions up to 6 % of the participants’ compensation. Matching contributions made by Peoples totaled $ 1.5 million during the three months ended March 31, 2025 and $ 1.5 million for the three months ended March 31, 2024. Note 9 Earnings Per Common Share The calculations of basic and diluted earnings per common share were as follows: Three Months Ended March 31, (Dollars in thousands, except per common share data) 2025 2024 Net income available to common shareholders $ 24,336 $ 29,584 Less: Dividends paid on unvested common shares 210 143 Less: Undistributed income allocated to unvested common shares 37 64 Net earnings allocated to common shareholders $ 24,089 $ 29,377 Weighted-average common shares outstanding 34,895,723 34,740,349 Effect of potentially dilutive common shares 401,412 311,461 Total weighted-average diluted common shares outstanding 35,297,135 35,051,810 Earnings per common share: Basic $ 0.69 $ 0.85 Diluted $ 0.68 $ 0.84 Anti-dilutive common shares excluded from calculation: Restricted common shares 149,082 3,180 Note 10 Derivative Financial Instruments Peoples utilizes interest rate swap agreements as part of its asset/liability management strategy to help manage its interest rate risk position. The notional amount of the interest rate swaps does not represent amounts exchanged by the parties. The amount exchanged is determined by reference to the notional amount and the other terms of the individual interest rate swap agreements. 30 Table of Contents Derivative Financial Instruments and Hedging Activities - Risk Management Objective of Using Derivative Financial Instruments Peoples is exposed to certain risks arising from both its business operations and economic conditions. Peoples principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. Peoples manages economic risks, including interest rate, liquidity and credit risk, primarily by managing the amount, sources and duration of its assets and liabilities. Peoples also manages interest rate risk through the use of derivative financial instruments. Specifically, Peoples enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known or expected cash amounts, the values of which are determined by interest rates. Peoples’ derivative financial instruments are used to manage differences in the amount, timing and duration of Peoples' known or expected cash receipts and its known or expected cash payments principally related to certain variable rate borrowings. Peoples also has interest rate derivative financial instruments that result from a service provided to certain qualifying customers and, therefore, are not used to manage interest rate risk in Peoples' assets or liabilities. Peoples manages a matched book with respect to customer-related derivative financial instruments in order to minimize its net risk exposure resulting from such transactions. Cash Flow Hedges of Interest Rate Risk Peoples' objectives in using interest rate derivative financial instruments are to add stability to interest income and expense, and to manage its exposure to interest rate movements. To accomplish these objectives, Peoples has entered into interest rate swaps as part of its interest rate risk management strategy. These interest rate swaps are designated as cash flow hedges and involve the receipt of variable rate amounts from a counterparty in exchange for Peoples making fixed payments. At March 31, 2025, Peoples had entered into seven interest rate swap contracts with an aggregate notional value of $ 65.0 million. Peoples will pay a fixed rate of interest for up to four years while receiving a floating rate component of interest equal to term secured overnight financing rate ("SOFR"). The interest received on the floating rate component is intended to offset the interest paid on rolling three-month brokered CDs or FHLB advances, which will continue to be rolled through the life of the interest rate swaps. At both March 31, 2025 and December 31, 2024, the interest rate swaps were designated as cash flow hedges of $ 65.0 and $ 75.0 million, respectively, in brokered CDs, which are expected to be extended every 90 days through the maturity dates of the interest rate swaps. For derivative financial instruments designated as cash flow hedges, the effective and ineffective portions of changes in the fair value of each derivative financial instrument is reported in accumulated other comprehensive (loss) income ("AOCI") (outside of earnings), net of tax, and are reclassified to interest expense as interest payments are made or received on Peoples' variable-rate liabilities. Peoples assesses the effectiveness of each hedging relationship by comparing the changes in cash flows of the hedging derivative financial instrument with the changes in cash flows of the designated hedged transaction. The reset dates and the payment dates on the brokered CDs or FHLB advances are matched to the reset dates and payment dates on the receipt of the term SOFR rate (or the three-month LIBOR floating portion prior to June 30, 2023) of the swaps to ensure effectiveness of the cash flow hedge. For the three months ended March 31, 2025, and 2024, Peoples recorded reclassifications of losses to earnings of $ 0.4 million and a gain of $ 0.9 million, respectively. During the next 12 months, Peoples estimates that $ 1.5 million of AOCI will be reclassified as an addition to interest expense. The following table summarizes information about the interest rate swaps designated as cash flow hedges: (Dollars in thousands) March 31, 2025 December 31, 2024 Notional amount $ 65,000 $ 75,000 Weighted average pay rates 2.58 % 2.45 % Weighted average receive rates 4.19 % 4.49 % Weighted average maturity 1.5 years 1.5 years Pre-tax changes in fair value included in AOCI $ 1,293 $ 1,885 31 Table of Contents The following table presents changes in fair value recorded in AOCI and in the Consolidated Statements of Operations related to the cash flow hedges: Three Months Ended March 31, (Dollars in thousands) 2025 2024 Amount of losses (gains) recorded in AOCI, pre-tax $ 661 $ ( 256 ) The following table reflects the cash flow hedges, which are included in the Unaudited Consolidated Balance Sheets at fair value: March 31, 2025 December 31, 2024 (Dollars in thousands) Notional Amount Fair Value Notional Amount Fair Value Included in "Other assets": Interest rate swaps related to debt $ 65,000 $ 1,207 $ 75,000 $ 1,784 Non-Designated Hedges Peoples Bank maintains an interest rate protection program for commercial loan customers, which was established in 2010. Under this program, Peoples Bank originates variable rate loans with interest rate swaps, where the customer enters into an interest rate swap with Peoples Bank on terms that match the terms of the loan. By entering into the interest rate swap with the customer, Peoples Bank effectively provides the customer with a fixed rate loan while creating a variable rate asset for Peoples Bank. Peoples Bank offsets its exposure in the interest rate swap by entering into an offsetting interest rate swap with an unaffiliated institution. These interest rate swaps do not qualify as designated hedges; therefore, each interest rate swap is accounted for as a standalone derivative financial instrument. These interest rate swaps did not have a material impact on Peoples' results of operations or financial condition at or for the three months ended March 31, 2025, or at or for the year ended December 31, 2024. The following table reflects the non-designated hedges, which are included in the Unaudited Consolidated Balance Sheets at fair value: March 31, 2025 December 31, 2024 (Dollars in thousands) Notional Amount Fair Value Notional Amount Fair Value Included in "Other assets": Interest rate swaps related to commercial loans $ 491,594 $ 12,885 $ 453,367 $ 16,959 Included in "Accrued expenses and other liabilities": Interest rate swaps related to commercial loans $ 491,594 $ 12,965 $ 453,367 $ 17,046 Pledged Collateral Peoples Bank pledges or receives collateral for all interest rate swaps. When the fair value of Peoples Bank interest rate swaps is in a net liability position, Peoples Bank must pledge collateral, and, when the fair value of Peoples Bank interest rate swaps is in a net asset position, the respective counterparties must pledge collateral. At March 31, 2025 and at December 31, 2024, Peoples Bank had no cash pledged, while counterparties had $ 8.1 million of cash pledged at March 31, 2025 and $ 12.3 million of cash pledged at December 31, 2024. Peoples Bank had no pledged investment securities at March 31, 2025 or at December 31, 2024, while the counterparties had pledged investment securities in the amounts of $ 1.9 million at March 31, 2025 and $ 1.9 million at December 31, 2024. Note 11 Stock-Based Compensation Under the Peoples Bancorp Inc. Fourth Amended and Restated 2006 Equity Plan (the "2006 Equity Plan"), Peoples may grant, among other awards, nonqualified stock options, incentive stock options, restricted common share awards, stock appreciation rights, performance units and unrestricted common share awards to employees and non-employee directors. The total number of common shares available under the 2006 Equity Plan is 1,493,297 . The maximum number of common shares that can be issued for incentive stock options is 750,000 . Since February 2009, Peoples has granted restricted common shares to employees, and periodically to non-employee directors, subject to the terms and conditions prescribed by the 2006 Equity Plan. In general, common shares issued in connection with stock-based awards are issued from treasury shares to the extent available. If no treasury shares are available, common shares are issued from authorized but unissued common shares. 32 Table of Contents Restricted Common Shares Under the 2006 Equity Plan, Peoples may award restricted common shares to officers, key employees and non-employee directors. In general, the restrictions on the restricted common shares awarded to officers and key employees expire after periods ranging from one to five years . Since 2018, common shares awarded to non-employee directors have vested immediately upon grant with no restrictions. In the first three months of 2025, Peoples granted an aggregate of 159,097 restricted common shares subject to performance-based vesting to officers and key employees with restrictions that will lapse three years after the grant date; provided that in order for the restricted common shares to vest in full, Peoples must have reported positive net income and maintained a well-capitalized status by regulatory standards for each of the three fiscal years preceding the vesting date. The following table summarizes the changes to Peoples’ restricted common shares for the three months ended March 31, 2025: Time-Based Vesting Performance-Based Vesting Number of Common Shares Weighted-Average Grant Date Fair Value Number of Common Shares Weighted-Average Grant Date Fair Value Outstanding at January 1, 2025 140,231 $ 28.72 586,227 $ 29.67 Awarded 2,069 31.39 159,097 33.41 Released ( 5,316 ) 31.35 ( 141,821 ) 32.21 Forfeited ( 7,731 ) 26.08 ( 23,799 ) 29.67 Outstanding at March 31, 2025 129,253 $ 28.81 579,704 $ 30.08 The intrinsic value for restricted common shares released was $ 4.8 million for the three months ended March 31, 2025, compared to $ 2.2 million for the three months ended March 31, 2024. Stock-Based Compensation Peoples recognizes stock-based compensation, which is included as a component of Peoples’ salaries and employee benefit costs, for restricted and unrestricted common shares, as well as purchases made by participants in the employee stock purchase plan. For restricted common shares, Peoples recognizes stock-based compensation based on the estimated fair value of the awards expected to vest on the grant date. The estimated fair value is then expensed over the vesting period, which is normally three years . Peoples also has an employee stock purchase plan whereby employees can purchase Peoples' common shares at a discount of 15 %. The following table summarizes the amount of stock-based compensation expense and related tax benefit recognized for each period: Three Months Ended March 31, (Dollars in thousands) 2025 2024 Employee stock-based compensation expense: Stock grant expense $ 2,430 $ 3,024 Employee stock purchase plan expense 45 66 Total employee stock-based compensation expense 2,475 3,090 Non-employee director stock-based compensation expense 116 138 Total stock-based compensation expense 2,591 3,228 Recognized tax benefit ( 604 ) ( 752 ) Net stock-based compensation expense $ 1,987 $ 2,476 The fair value of restricted common share awards on the grant date is the market price of Peoples' common shares on that date. Total unrecognized stock-based compensation expense related to unvested restricted common share awards was $ 8.7 million at March 31, 2025, which will be recognized over a weighted-average period of 2.2 years. 33 Table of Contents Note 12 Revenue The following table details Peoples' revenue from contracts with customers: Three Months Ended March 31, (Dollars in thousands) 2025 2024 Insurance income: Commission and fees from sale of insurance policies (a) $ 4,512 $ 4,285 Performance-based commissions (b) 1,542 2,213 Trust and investment income: Fiduciary income (a) 2,915 2,757 Brokerage income (a) 2,146 1,842 Electronic banking income: Interchange income (a) 4,845 4,797 Promotional and usage income (a) 1,040 1,249 Deposit account service charges: Ongoing maintenance fees for deposit accounts (a) 1,643 1,718 Transaction-based fees (b) 2,372 2,505 Commercial loan swap fees (b) 537 52 Other non-interest income transaction-based fees (b) 470 504 Total revenue from contracts with customers $ 22,022 $ 21,922 Timing of revenue recognition: Services transferred over time $ 17,101 $ 16,648 Services transferred at a point in time 4,921 5,274 Total revenue from contracts with customers $ 22,022 $ 21,922 (a) Services transferred over time. (b) Services transferred at a point in time. Peoples records contract assets for income that has been recognized over a period of time for fulfillment of performance obligations, but payment has not yet been received related to electronic banking income and certain insurance income. This income typically relates to bonuses for which Peoples is eligible, but will not receive until a certain time in the future. Peoples records contract liabilities for payments received for commission income related to the sale of insurance policies, for which the performance obligations have not yet been fulfilled. The contract liabilities are recognized as income over time, during the period in which the performance obligations are fulfilled, which is over the insurance policy period. Peoples also records contract liabilities for bonuses received related to electronic banking income, for which the performance obligations have not yet been fulfilled. The contract liabilities are recognized as income over time, during the period in which the performance obligations are fulfilled related to electronic banking income. The following table details the changes in Peoples' contract assets and contract liabilities for the three-month period ended March 31, 2025: Contract Assets Contract Liabilities (Dollars in thousands) Balance, January 1, 2025 $ 899 $ 5,771 Additional income receivable 5 — Additional deferred income — — Receipt of income previously receivable ( 15 ) — Recognition of income previously deferred — ( 555 ) Balance, March 31, 2025 $ 889 $ 5,216 34 Table of Contents Note 13 Leases Peoples has elected certain practical expedients, in accordance with ASC 842 - Leases ("ASC 842"). As a lessor, Peoples has made an accounting policy election to exclude from the consideration in the contract, and from variable payments not included in the consideration in the contract, all sales and other similar taxes assessed. Peoples has also made an accounting policy election to account for each separate lease component of a contract and its associated non-lease components as a single lease component for all leases subject to ASC 842. Lessor Arrangements Peoples began originating leases with the acquisition of leases from NSL and increased its portfolio with the acquisition of Vantage. The leases for NSL were determined to be sales-type leases, as the premise for the leases is dollar buy-out, whereby the lessee pays one dollar at maturity of the lease to purchase the equipment. The leases for Vantage were determined to be primarily sales-type leases, as the payment structure and term triggered that accounting treatment, whereby either (i) the lease is structured as a fair market value buyout, whereby the lessee has the option to purchase the leased equipment at its fair market value at maturity of the lease, or (ii) the lessee purchases the leased equipment for one dollar at maturity of the lease. Originated leases are primarily classified as sales-type leases, and to a lesser extent, operating leases. These leases do not typically contain residual value guarantees; however, Peoples reduces its residual asset risk by obtaining a security deposit from the lessee. As a lessor, Peoples originates commercial equipment leases either directly to the customer or indirectly through vendor programs. Equipment leases relate to automotive, construction, healthcare, manufacturing, office, restaurant, information technology and other equipment. These leases include an estimated residual value, which is assessed for impairment as part of the allowance for credit losses. Operating leases are leases that do not meet the criteria of a sales-type lease or a finance lease. When Peoples originates an operating lease, it records an operating lease asset recognized in “Other assets” which is depreciated over its useful life. Operating leases assets are assessed for impairment consistent with Peoples’ fixed assets. Sales-type leases originated by Peoples, that Peoples has the positive intent and ability to hold for the foreseeable future or to maturity or payoff, are reported at the net investment of the lease, net of initial direct costs, charge-offs and an allowance for credit losses. Peoples considers leases past due if any required payments have not been received as of the date such payments were required to be made under the terms of the lease agreement. Upon detection of the reduced ability of a lessee to meet cash flow obligations, leases are typically charged down to the net realizable value, with the residual balance placed on nonaccrual status. Leases deemed to be uncollectable are charged against the allowance for credit losses, while recoveries of previously charged-off amounts are credited to the allowance for credit losses. Lease income noted in the table below includes (i) operating lease income, (ii) gains on the early termination of leases, net of any associated purchase accounting adjustments (iii) month-to-month lease payments in excess of net investment in the lease, (iv) fees received for referrals, (v) gains and losses recognized on the sales of residual assets and (vi) syndication income. Additional information regarding Peoples' leases can be found in "Note 4 Loans and Leases." The table below details Peoples' lease income: Three Months Ended (Dollars in thousands) March 31, 2025 March 31, 2024 Interest and fees on leases (a) $ 10,198 $ 12,067 Lease income 3,446 2,021 Total lease income $ 13,644 $ 14,088 (a) Included in "Interest and fees on loans and leases" in the Unaudited Consolidated Statements of Operations. For additional information, see "Note 4 Loans and Leases" of the Notes to the Unaudited Condensed Consolidated Financial Statements. 35 Table of Contents The following table summarizes the net investment in leases, which is included in "Loans and leases, net of deferred fees and costs" on the Unaudited Consolidated Balance Sheets: (Dollars in thousands) March 31, 2025 December 31, 2024 Lease payments receivable, at amortized cost $ 431,584 $ 448,027 Estimated residual values 33,558 33,129 Initial direct costs 6,581 7,148 Deferred revenue ( 76,269 ) ( 81,706 ) Net investment in leases 395,454 406,598 Allowance for credit losses - leases ( 13,575 ) ( 12,893 ) Net investment in leases, after allowance for credit losses $ 381,879 $ 393,705 The following table summarizes the contractual maturities of leases: (Dollars in thousands) Balance Remaining nine months ending December 31, 2025 $ 102,431 Year ending December 31, 2026 91,918 Year ending December 31, 2027 92,471 Year ending December 31, 2028 74,142 Year ending December 31, 2029 50,127 Thereafter 20,495 Lease payments receivable, at amortized cost $ 431,584 Lessee Arrangements Peoples leases certain banking facilities and equipment under various agreements with original terms providing for fixed monthly payments over periods generally ranging from two to 30 years. Certain leases may include options to extend or terminate the lease. Only those renewal and termination options which Peoples is reasonably certain of exercising are included in the calculation of the lease liability. Certain leases contain rent escalation clauses calling for rent increases over the term of the lease, which are included in the calculation of the lease liability. At March 31, 2025, Peoples did not have any leases that met the criteria for finance leases. Right of Use ("ROU") assets represent the right to use an underlying asset for the lease term and lease liabilities represent an obligation to make lease payments arising from the lease. Operating lease ROU assets and lease liabilities are recognized at the commencement or the remeasurement date of a lease based on the present value of lease payments over the remaining lease term. Operating lease ROU assets include lease payments made at or before the commencement date and initial indirect costs. Operating lease ROU assets are presented net of any lease incentives. Short-term leases of certain facilities and equipment, with lease terms of 12 months or less, are recognized on a straight-line basis over the lease term and do not have an ROU asset or lease liability. The table below details Peoples' lease expense, which is included in "Net occupancy and equipment expense" in the Unaudited Consolidated Statements of Operations: Three Months Ended (Dollars in thousands) March 31, 2025 March 31, 2024 Operating lease expense $ 713 $ 735 Short-term lease expense 363 305 Variable lease expense 9 — Total lease expense $ 1,085 $ 1,040 Peoples utilizes an incremental borrowing rate to determine the present value of lease payments for each lease, as the lease agreements do not provide an implicit rate. The estimated incremental borrowing rate reflects a secured rate and is based on the term of the lease. 36 Table of Contents The following table details the ROU assets, the lease liabilities and other information related to Peoples' operating leases at the dates shown: (Dollars in thousands) March 31, 2025 December 31, 2024 ROU assets: Other assets $ 10,674 $ 10,419 Lease liabilities: Accrued expenses and other liabilities $ 11,254 $ 10,968 Other information: Weighted-average remaining lease term 8.7 years 9.0 years Weighted-average discount rate 4.14 % 4.11 % Additions for ROU assets obtained during the year $ 852 $ 1,660 During both the three months ended March 31, 2025 and 2024, Peoples paid cash of $ 0.7 million for operating leases. The following table summarizes the maturity of remaining lease liabilities: (Dollars in thousands) Balance Remaining nine months ending December 31, 2025 $ 1,911 Year ending December 31, 2026 2,351 Year ending December 31, 2027 2,091 Year ending December 31, 2028 1,575 Year ending December 31, 2029 1,121 Thereafter 4,549 Total undiscounted lease payments $ 13,598 Imputed interest $ ( 2,344 ) Total lease liabilities $ 11,254 37 Table of Contents