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Item 2. Management’s Discussion and Analysis

2026-04-30 compared with 2025-10-30 · 288 added, 434 removed, 855 unchanged (46% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management’s Discussion and Analysis (“MD&A”) represents an overview of the results of operations and financial condition of Peoples at and for the three and nine months ended September 30, 2025 and September 30, 2024.

Management’s Discussion and Analysis (“MD&A”) represents an overview of the results of operations and financial condition of Peoples at and for the three months ended March 31, 2026 and March 31, 2025.

This MD&A should be read in conjunction with the Unaudited Condensed Consolidated Financial Statements and the Notes thereto.

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(2) the effects of inflationary pressures on borrowers’ liquidity and ability to repay;

(3) the success, impact, and timing of the implementation of Peoples' business strategies and Peoples' ability to manage strategic initiatives, including the interest rate policies of the Federal Reserve Board, the completion and successful integration of acquisitions, and the expansion of commercial and consumer lending activities;

(3) the success, impact, and timing of the implementation of Peoples' business strategies and Peoples' ability to manage strategic initiatives, including the interest rate policies of the Federal Reserve Board, the completion and successful integration of acquisitions, including the pending merger with Citizens National Corporation (the "Citizens Merger"), and the expansion of commercial and consumer lending activities;

(4) competitive pressures among financial institutions, or from non-financial institutions, which may increase significantly, including product and pricing pressures, which can in turn impact Peoples' credit spreads, changes to third-party relationships and revenues, changes in the manner of providing services, customer acquisition and retention pressures, and Peoples' ability to attract, develop and retain qualified professionals;

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(18) the impact of larger or similar-sized financial institutions encountering problems, such as the failure in 2024 of Republic First Bank, and closures in 2023 of Silicon Valley Bank in California, Signature Bank in New York, and First Republic Bank in California, which may adversely affect the banking industry and/or Peoples' business generation and retention, funding and liquidity, including Peoples' continued ability to grow deposits or maintain adequate deposit levels, and may further result in potential increased regulatory requirements, increased reputational risk and potential impacts to macroeconomic conditions;

(19) Peoples' ability to secure confidential information and deliver products and services through the use of computer systems and telecommunications networks, including those of Peoples' third-party vendors and other service providers, which may prove inadequate, and could adversely affect customer confidence in Peoples and/or result in Peoples incurring a financial loss;

(20) any misappropriation of the confidential information which Peoples possesses could have an adverse impact on Peoples' business and could result in regulatory actions, litigation and other adverse effects;

(19) Peoples' ability to secure confidential information and avoid misappropriation of confidential information in connection with the delivery of products and services through the use of computer systems and telecommunications networks, including those of Peoples' third-party vendors and other service providers, which may prove inadequate, and could adversely affect customer confidence in Peoples and/or result in Peoples incurring a financial loss;

(20) Peoples' ability to anticipate and respond to technological changes, and Peoples' reliance on, and the potential failure of, a number of third-party vendors to perform as expected, including Peoples' primary core banking system provider, which can impact Peoples' ability to respond to customer needs and meet competitive demands;

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(24) the impact on Peoples' businesses, personnel, facilities, or systems of losses related to acts of fraud, theft, misappropriation or violence;

(26) the impact on Peoples' businesses, as well as on the risks described above, of various domestic or international widespread natural or other disasters (including severe weather events), pandemics, cybersecurity attacks, system failures, civil unrest, military or terrorist activities or international conflicts (including Russia’s war in Ukraine and the ongoing conflicts in the Middle East);

(25) the impact on Peoples' businesses, as well as on the risks described above, of various domestic or international widespread natural or other disasters including severe weather events, pandemics, cybersecurity attacks, system failures, civil unrest, military or terrorist activities or international conflicts including Russia's ongoing war on Ukraine, the continued U.S.

political and military presence in Venezuela, and the conflict in Iran (and the resulting disruptions in oil, energy and other commodity markets and supply chains);

(26) the potential deterioration of the U.S.

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(32) regulatory and legal matters, including the failure to resolve any outstanding matters on a timely basis and the potential of new regulatory matters, litigation, or other legal actions, which may result in, among other things, additional costs, fines, penalties, restrictions on our business activities, reputational harm, or other adverse consequences;

(34) Peoples' business may be adversely affected by increased political and regulatory scrutiny of corporate environmental, social and governance ("ESG") practices;

(33) the impact on Peoples of increased political and regulatory scrutiny of corporate environmental, social and governance ("ESG") practices;

(34) the effect of a fall in stock market prices on Peoples' asset and wealth management business

(35) the risk that the proposed Citizens Merger is not completed as a result of a failure to satisfy the conditions to the Citizens Merger, including receipt of required regulatory, shareholder and other approvals;

(36) the possibility that the anticipated benefits of the proposed Citizens Merger, including expected revenue synergies and cost savings, will not be realized or will not be realized within expected time periods;

(37) Peoples' ability to integrate the Citizens Merger, which may be unsuccessful, or may be more difficult, time-consuming or costly than expected;

(38) the risk that energy tax credits purchased and used by People to reduce tax liabilities will be disallowed by the IRS;

(39) other risk factors relating to the banking industry or Peoples as detailed from time to time in Peoples' reports filed with the Securities and Exchange Commission (the "SEC"), including those risk factors included in the disclosures under the heading "ITEM 1A.

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Brokerage services are offered by Peoples exclusively through an unaffiliated registered broker-dealer located at Peoples Bank's offices.

Peoples Bank offers insurance premium finance lending nationwide through its Peoples Premium Finance division.

Peoples Bank offers insurance premium finance lending nationwide through its Peoples Premium Finance and Peoples Life Premium Finance divisions.

Peoples also offers lease financing through its North Star Leasing division and through Vantage, a subsidiary of Peoples Bank.

As of September 30, 2025, Peoples had 145 locations, including 127 full-service bank branches in Ohio, Kentucky, West Virginia, Virginia, Washington D.C.

As of March 31, 2026, Peoples had 144 locations, including 127 full-service bank branches in Ohio, Kentucky, West Virginia, Virginia, Washington D.C.

and Maryland.

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Note 1 of the Notes to the Unaudited Condensed Consolidated Financial Statements describes Peoples' significant accounting policies.

Management has identified the accounting policies that, due to the judgments, estimates and assumptions inherent in those policies, are critical to understanding Peoples’ Unaudited Condensed Consolidated Financial Statements, and this MD&A at September 30, 2025, which have been disclosed in Peoples' 2024 Form 10-K and updated as necessary in "Note 1 Summary of Significant Accounting Policies" in the Notes to the Unaudited Condensed Consolidated Financial Statements included in this Form 10-Q.

Management has identified the accounting policies that, due to the judgments, estimates and assumptions inherent in those policies, are critical to understanding Peoples’ Unaudited Condensed Consolidated Financial Statements, and this MD&A at March 31, 2026, which have been disclosed in Peoples' 2025 Form 10-K and updated as necessary in "Note 1 Summary of Significant Accounting Policies" in the Notes to the Unaudited Condensed Consolidated Financial Statements included in this Form 10-Q.

This MD&A should be read in conjunction with the policies disclosed in Peoples’ 2025 Form 10-K.

New Accounting Guidance Pending Adoption

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

Improvements to Income Tax Disclosures:

The FASB issued ASU 2023-09 on December 14, 2023.

The standard requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid.

The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions.

ASU 2023-09 applies to all entities subject to income taxes.

For public business entities, the new requirements were effective for annual periods beginning after December 15, 2024.

The guidance will be applied on a prospective basis with the option to apply the standard retrospectively with early adoption permitted.

Peoples does not expect the update will have a material impact on its consolidated financial statements.

ASU 2025-01 - Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40):

Clarifying the Effective Date:

The FASB issued ASU 2025-01 on January 6, 2025.

It clarifies the effective date of ASU 2024-03, which pertains to disaggregation of income statement expenses.

For public business entities, the new requirements will be effective for annual periods beginning after December 15, 2026.

Peoples is currently evaluating the impact of adopting this new guidance on its consolidated financial statements.

ASU 2025-08 - Financial Instruments - Credit Losses (Topic 326):

Purchased Loans:

The FASB issued an Accounting Standards Update (“ASU”) 2025-08 on November 12, 2025.

The amendments “expand the population of acquired financial assets subject to the gross-up approach in Topic 326.” Specifically, the ASU expands the scope to include purchased “seasoned” loans, which are evaluated after purchase credit deteriorated (“PCD”) loans have been identified.

These seasoned loans are defined as non-PCD loans that are obtained in a business combination accounted for using the acquisition method or non-PCD loans that are (i) obtained through a transfer that is not a business combination accounted for using the acquisition method or (ii) initially recognized through the consolidation of a variable interest entity.

The ASU applies to all public entities subject to the guidance in Topic 326, including public business entities, privates companies, and not-for-profit entities.

The amendments in this update apply “prospectively to loans that are acquired on or after the initial application date.” The amendments in ASU 2025-08 are effective for all entities for fiscal years beginning after December 15, 2026 and interim periods within those annual reporting periods, with early adoption permitted.

Peoples is currently evaluating the impact of this guidance.

Summary of Recent Transactions and Events

The following is a summary of recent transactions and events that have impacted or are expected to impact Peoples’ results of operations or financial condition:

◦ For the third quarter of 2025, Peoples recorded a provision for credit losses of $7.3 million, compared to a provision for credit losses of $16.6 million for the linked quarter and a provision for credit losses of $6.7 million for the third quarter of 2024.

The provision for credit losses for the third quarter of 2025 was primarily driven by (i) net charge offs, (ii) loan growth, (iii) a slight deterioration in the economic forecasts used within the CECL model, partially offset by reductions in reserves for individually analyzed loans and leases.

The provision for credit losses for the second quarter of 2025 was primarily driven by (i) net charge offs, (ii) an increase in reserves for individually analyzed loans and leases, (iii) an increase in reserves for leases originated by our North Star Leasing division, (iv) a periodic refresh in loss drivers utilized within the CECL model, (v) deterioration in the economic forecasts used within the CECL model, and (vi) loan growth.

The provision for the third quarter of 2024 was primarily driven by net charge-offs.

◦ On April 21, 2026, Peoples announced the signing of a definitive agreement and plan of merger pursuant to which Peoples will acquire Citizens National Corporation ("Citizens"), a bank holding company headquartered in Paintsville, Kentucky, and the parent company of Citizens Bank of Kentucky, Inc.

("Citizens Bank"), in a cash and stock transaction.

Under the terms of the agreement and plan of merger, Citizens will merge with and into Peoples, and Citizens Bank will subsequently merge with and into Peoples Bank, in a transaction valued at approximately $76.6 million.

◦ For the first quarter of 2026, Peoples recorded a provision for credit losses of $9.7 million, compared to a provision for credit losses of $8.1 million for the linked quarter and a provision for credit losses of $10.2 million for the first quarter of 2025.

The provision for credit losses for the first quarter of 2026 was primarily driven by net charge-offs and a deterioration in the macroeconomic forecasts used within the CECL model.

The provision for credits losses for the linked quarter was primarily driven by (i) net charge-offs, (ii) loan growth, and (iii) a slight deterioration in the economic forecasts used within the CECL model, partially offset by reductions in reserves for individually analyzed loans and leases.

The provision for credit losses for the first quarter of 2025 was primarily driven by net charge-offs.

For more information, please refer to the section titled "RESULTS OF OPERATIONS - Provision for Credit Losses" found later in this MD&A.

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This rate remained unchanged until the latter half of 2024, where multiple rate cuts reduced the rate down to 4.25% to 4.50%.

The Federal Reserve Board announced a subsequent 25 basis point rate cut in September 2025, further reducing the rate to 4.00% to 4.25%.

The Federal Reserve Board cut interest rates three times during 2025, further reducing the rate to 3.50% to 3.75%.

The Federal Reserve Board has signaled that future rate reductions continue to be a possibility.

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EXECUTIVE SUMMARY

Peoples reported net income of $29.5 million for the third quarter of 2025, representing earnings per diluted common share of $0.83.

In comparison, Peoples reported net income of $21.2 million, representing earnings per diluted common share of $0.59, for the second quarter of 2025, and net income of $31.7 million, representing earnings per diluted common share of $0.89, for the third quarter of 2024.

Non-core items negatively impacted earnings per diluted common share by $0.07 for the third quarter of 2025, $0.01 for the second quarter of 2025, and $0.01 for the third quarter of 2024.

For the nine months ended September 30, 2025, Peoples recorded net income of $75.0 million, or $2.10 per diluted common share, compared to $90.3 million, or $2.55 per diluted common share, for the nine months ended September 30, 2024.

Net interest income was $91.3 million for the third quarter of 2025, and increased $3.8 million, or 4%, when compared to the linked quarter.

Net interest margin was 4.16% for the third quarter of 2025, compared to 4.15% for the linked quarter.

The increase in net interest income and net interest margin was primarily driven by higher loan balances and higher yields on investment securities, respectively.

Net interest income for the third quarter of 2025 increased $2.4 million, or 3%, compared to the third quarter of 2024.

The increase in net interest income compared to the third quarter of 2024 was driven by growth in loan and investment portfolios.

Net interest margin for the third quarter of 2025 was 4.16% and decreased 11 basis points compared to 4.27% for the third quarter of 2024, impacted primarily by reductions in loan yields, driven by lower accretion income.

Net interest income for the first nine months of 2025 was $264.2 million, compared to $262.2 million for the same period of 2024.

Net interest margin for the first nine months of 2025 was 4.15%, compared to 4.24% for the same period of 2024 and was driven by lower accretion income.

Accretion income, net of amortization expense, from acquisitions was $1.7 million for the third quarter of 2025, $2.6 million for the second quarter of 2025 and $8.1 million for the third quarter of 2024, which added 8 basis points, 12 basis points and 39 basis points, respectively, to net interest margin.

The decrease in accretion income for the third quarter of 2025 when compared to the linked quarter and the third quarter of 2024 was driven by fewer loan payoffs and more accretion income recognized in 2024 from the merger

with Limestone Bancorp Inc.

(the "Limestone Merger").

Accretion income, net of amortization expense, from acquisitions was $7.8 million and $20.3 million for the first nine months of 2025 and 2024, respectively.

Accretion income added 12 basis points and 33 basis points to net interest margin for the first nine months of 2025 and 2024, respectively.

The decrease in accretion income for the first nine months of 2025 compared to the same period in 2024 was due to more accretion recognized in 2024 from the Limestone Merger.

The provision for credit losses was $7.3 million for the third quarter of 2025, compared to a provision for credit losses of $16.6 million for the linked quarter and a provision for credit losses of $6.7 million for the third quarter of 2024.

The provision for credit losses for the third quarter of 2025 was primarily driven by (i) net charge offs, (ii) loan growth, and (iii) a slight deterioration in the economic forecasts used within the CECL model, partially offset by reductions in reserves for individually analyzed loans and leases.

The provision for credit losses for the linked quarter was primarily driven by(i) net charge offs, (ii) an increase in reserves for individually analyzed loans and leases, (iii) an increase in reserves for leases originated by our North Star Leasing division, (iv) a periodic refresh in loss drivers utilized within the CECL model, (v) deterioration in the economic forecasts used within the CECL model, and (vi) loan growth.

Net charge-offs for the third quarter of 2025 were $6.8 million, or 0.41% of average total loans annualized, compared to net charge-offs of $7.0 million, or 0.43% of average total loans annualized, for the linked quarter and net charge-offs of $6.1 million, or 0.38% of average total loans annualized, for the third quarter of 2024.

Peoples reported net income of $29.0 million for the first quarter of 2026, representing earnings per diluted common share of $0.81.

In comparison, Peoples reported net income of $31.8 million, representing earnings per diluted common share of $0.89, for the fourth quarter of 2025, and net income of $24.3 million, representing earnings per diluted common share of $0.68, for the first quarter of 2025.

Non-core items negatively impacted earnings per diluted common share by $0.01 for the first quarter of 2026, $0.04 for the fourth quarter of 2025, and $0.01 for the first quarter of 2025.

Net interest income was $90.4 million for the first quarter of 2026, a decrease of $0.6 million when compared to the linked quarter.

Net interest margin was 4.16% for the first quarter of 2026, compared to 4.12% for the linked quarter.

The decrease in net

interest income was primarily driven by a decrease in accretion income coupled with fewer days in the quarter compared to the linked quarter.

The increase in net interest margin was driven by a reduction in deposit costs.

Net interest income for the first quarter of 2026 increased $5.2 million, or 6%, compared to the first quarter of 2025.

Net interest margin increased 4 basis points when compared to the first quarter of 2025.

The increase in net interest income compared to the first quarter of 2025 was driven by lower deposit and borrowing costs.

Accretion income, net of amortization expense, was $1.3 million for the first quarter of 2026, $1.8 million for the fourth quarter of 2025 and $3.5 million for the first quarter of 2025, which added 6 basis points, 8 basis points and 17 basis points, respectively, to net interest margin.

The decrease in accretion income for the first quarter of 2026 when compared to the first quarter of 2025 was driven by less accretion recognized in the current period from the 2023 merger with Limestone Bancorp, Inc.

("Limestone Merger").

The provision for credit losses was $9.7 million for the first quarter of 2026, compared to a provision for credit losses of $8.1 million for the linked quarter and a provision for credit losses of $10.2 million for the first quarter of 2025.

The provision for credit losses for the first quarter of 2026 was primarily driven by net charge-offs and a deterioration in the economic forecasts used within the CECL model.

The provision for credit losses for the first quarter of 2025 was primarily driven by net charge-offs.

Net charge-offs for the first quarter of 2026 were $6.6 million, or 0.40% of average total loans annualized, compared to net charge-offs of $7.4 million, or 0.44% of average total loans annualized, for the linked quarter and net charge-offs of $8.1 million, or 0.52% of average total loans annualized, for the first quarter of 2025.

For additional information on credit trends and the allowance for credit losses, see the "FINANCIAL CONDITION - Allowance for Credit Losses" section below.

The provision for credit losses for the first nine months of 2025 was $34.1 million, compared to a provision for credit losses of $18.5 million for the first nine months of 2024.

The provision for credit losses during the first nine months of 2025 was mainly a result of (i) net charge offs, (ii) an increase in reserves for individually analyzed loans and leases, (iii) an increase in reserves for leases originated by our North Star Leasing division, (iv) deterioration in the economic forecasts used within the CECL model, (v) and loan growth.

The provision for credit losses for the first nine months of 2024 was mainly a result of (i) higher net charge-offs, (ii) an increase in reserves for individually analyzed loans and leases, (iii) economic forecast deterioration, and (iv) loan growth.

Net charge-offs for the first nine months of 2025 were $21.9 million, or 0.45% of average total loans and leases annualized, compared to net charge-offs of $13.6 million, or 0.29% annualized, for the first nine months of 2024.

For additional information on credit trends and the allowance for credit losses, see the "Asset Quality" section below.

Net gains and losses include gains and losses on investment securities, asset disposals and other transactions, which are included in total non-interest income on the Consolidated Statements of Operations.

The net loss realized during the third quarter of 2025 was $3.1 million, compared to a net loss of $0.3 million for the linked quarter and a net loss of $0.9 million for the third quarter of 2024.

The net loss for the third quarter of 2025 was driven by a $2.7 million loss on the sale of lower-yielding available-for-sale securities.

The net loss for the second quarter of 2025 and for the third quarter of 2024 was due to $0.3 million and $0.5 million of net losses on repossessed assets, respectively.

For the nine months ended September 30, 2025, the total net loss was $3.7 million, compared to $2.0 million for the same period in 2024.

The net loss for the first nine months of 2025 was primarily driven by the $2.7 million loss on the sale of lower yielding available-for-sale securities.

The net loss recognized in the first nine months of 2024 was primarily driven by $1.3 million of net losses on repossessed assets.

Total non-interest income, excluding net gains and losses, for the third quarter of 2025 decreased $0.3 million compared to the linked quarter.

The decrease was primarily impacted by a decrease of $0.6 million in lease income, driven by gains on terminated Vantage leases recorded in the linked quarter, partially offset by an increase of $0.3 million in electronic banking ("e-banking") income, driven by debit card interchange fees.

Compared to the third quarter of 2024, total non-interest income, excluding net gains and losses, increased $1.2 million, due to an increase of $0.7 million in BOLI, an increase of $0.6 million in lease income, and an increase of $0.5 million in trust and investment income, which was driven by an increase in assets under administration and management, partially offset by a decrease of $0.8 million in mortgage banking income.

For the first nine months of 2025, total non-interest income, excluding gains and losses, increased $5.2 million, or 7%, compared to the first nine months of 2024.

The increase was driven by (i) a $4.0 million increase in lease income, driven by gains on early Vantage lease terminations and increased operating lease income, (ii) a $1.3 increase in trust and investment income, driven by an increase in assets under administration and management, and (iii) a $1.0 million increase in other non-interest income, primarily driven by an increase in swap fee income due to customer demand.

These increases were partially offset by a $0.8 million decrease in mortgage banking income and a $0.7 million decrease in deposit account service charges due to customer activity.

Total non-interest expense decreased $0.5 million for the three months ended September 30, 2025, compared to the linked quarter.

The decrease was primarily due to a decrease of $0.8 million in professional fees and $0.6 million in other non-interest expense, driven by lower corporate expenses, partially offset by increases of $0.3 million in marketing expenses and $0.2 million in franchise tax expenses.

Compared to the third quarter of 2024, total non-interest expense increased $3.8 million, or 6%.

The increase was primarily driven by increases of $1.6 million in salaries and employee benefit costs, which were driven by higher sales-based incentive, medical costs, and payroll taxes, $1.2 million in data processing and software expense, and $1.2 million in other non-interest expense, partially offset by a decrease of $0.6 million in amortization of other intangible assets.

For the nine months ended September 30, 2025, total non-interest expense increased $7.7 million, or 4%, compared to the first nine months of 2024.

The increase was driven by increases of (i) $4.9 million in salaries and employee benefits costs, which were driven by higher sales-based incentive and medical costs, (ii) $3.1 million in data processing and software expenses, (iii) $0.7 million in professional fees, and (iv) $0.6 million in operating lease expense, partially offset with decreases of $1.7 million in amortization of other intangible assets and $1.1 million in net occupancy and equipment expense.

The efficiency ratio for the third quarter of 2025 was 57.1%, compared to 59.3% for the linked quarter and 55.1% for the third quarter of 2024.

The efficiency ratio improved compared to the linked quarter mainly as the result of higher net interest income and lower non-interest expenses.

The efficiency ratio for the first nine months of 2025 was 59.0%, compared to 57.4% for the first nine months of 2024.

The efficiency ratio increased compared to the prior year first nine months due to the increase in non-interest expense and lower net interest income.

Peoples recorded income tax expense of $8.5 million with an effective tax rate of 22.4% for the third quarter of 2025, compared to income tax expense of $6.2 million with an effective tax rate of 22.7% for the linked quarter, and income tax expense of $9.2 million with an effective tax rate of 22.5% for the third quarter of 2024.

The increase in income tax expense when compared to the prior quarter was primarily due to higher pre-tax income.

Peoples' income tax expense for the first nine months of 2025 was $21.8 million with an effective tax rate of 22.5%, compared to $24.3 million with an effective tax rate of 21.2% for the same period of 2024.

Total assets were $9.62 billion as of September 30, 2025, $9.54 billion at June 30, 2025, $9.25 billion at December 31, 2024, and $9.14 billion at September 30, 2024.

Total assets at September 30, 2025 increased when compared to at June 30, 2025 primarily due to increases in period-end loan and lease balances.

Period-end total loan and lease balances at September 30, 2025 increased $127.1 million, or 8% annualized, compared to at June 30, 2025.

The increase in loans was driven by increases of $121.2 million in other commercial real estate loans and $82.1 million in commercial and industrial loans, partially offset by a decrease of $80.3 million in construction loans.

Total assets at September 30, 2025 increased compared to at December 31, 2024 due to increases of $370.7 million in total loans and leases and $157.0 million in held-to-maturity investment securities, partially offset by decreases in available-for sale investment securities of $106.6 million.

Total assets at September 30, 2025 increased compared to at September 30, 2024 due to increases of $456.9 million in total loans and leases and $142.7 million in total investment securities, partially offset by a decrease of $93.5 million in total cash and cash equivalents.

Total liabilities were $8.44 billion at September 30, 2025, up from $8.39 billion at June 30, 2025, $8.14 billion at December 31, 2024, and $8.02 billion at September 30, 2024.

The increase in total liabilities when compared to at June 30, 2025 was primarily due to an increase of $86.7 million in short-term borrowings, partially offset by a decrease of $5.0 million in period-end total deposits.

Total liabilities increased compared to at December 31, 2024 due to increases in short-term borrowings and non-interest bearing deposits of $290.1 million and $28.4 million, respectively, and were partially offset by a decrease in accrued expenses and other liabilities of $22.8 million.

The increase in total liabilities when compared to at September 30, 2024 was primarily due increases of $307.6 million and $149.0 million in short-term borrowings and period-end deposits, respectively.

The increase in deposits was primarily driven by an increase of $124.5 million in retail certificates of deposit, driven by current promotional offerings, $82.7 million in non-interest bearing deposits, and $53.5 million in money market deposits.

These were partially offset by a decrease of $79.1 million in brokered deposits and a $54.4 million decrease in governmental deposit accounts.

Total stockholders' equity at September 30, 2025 increased $29.4 million compared to at June 30, 2025, which was primarily due to net income for the quarter of $29.5 million and a decrease of $12.7 million in accumulated other comprehensive loss, partially offset by dividends paid of $14.7 million.

Accumulated unrealized losses related to the available-for-sale investment securities portfolio were $78.1 million and $90.9 million at September 30, 2025 and at June 30, 2025, respectively.

Total stockholders' equity at September 30, 2025 increased $71.2 million, or 6%, compared to at December 31, 2024, which was due to net income of $75.0 million in the first nine months of 2025 and a decrease of $32.8 million in accumulated other comprehensive loss, partially offset by dividends paid of $43.5 million.

Total stockholders' equity at September 30, 2025 increased by $57.8 million compared to at September 30, 2024 and was impacted by net income of $102.0 million in the last twelve months and a decrease in accumulated other comprehensive loss of $5.0 million, partially offset by dividends paid of $57.7 million.

The net loss realized during the first quarter of 2026 was $0.4 million, compared to a net loss of $2.0 million for the linked quarter and a net loss of $0.4 million for the first quarter of 2025.

The net losses for the first quarter of 2026 and for the first quarter of 2025 were driven by losses on repossessed assets.

The net loss for the linked quarter was driven by a $0.9 million net loss on the sale of an OREO property and a $0.8 million loss on the redemption of subordinated debt.

Total non-interest income, excluding net gains and losses, for the first quarter of 2026 increased $0.4 million compared to the linked quarter.

The increase in non-interest income, excluding net gains and losses, was primarily impacted by an increase of $1.1 million in insurance income, driven by annual performance-based commissions typically received in the first quarter of each year, partially offset by a decrease of $0.4 million in electronic banking income and $0.4 million in deposit account service charges, which are seasonally higher in the fourth quarter of each year.

Compared to the first quarter of 2025, total non-interest income, excluding net gains and losses, increased $1.2 million, due to an increase of $1.1 million in lease income, driven by an increase in operating lease income, and an increase of $0.5 million in trust and investment income, which was driven by an increase in assets under administration and management, partially offset by a decrease of $0.5 million in insurance income, driven by lower annual performance-based commissions.

Total non-interest expense increased $0.3 million for the three months ended March 31, 2026, compared to the linked quarter.

The increase in total non-interest expense was primarily due to increases of $0.7 million in salaries and employee benefit costs, driven by up-front expense on stock grants to retirement-eligible employees and employer health savings account contributions, $0.3 million in operating lease expense, and $0.2 million in net occupancy and equipment expense.

These increases were partially offset by decreases of $0.5 million in amortization of other intangible assets and $0.4 million in professional fees, driven by lower legal expenses.

Compared to the first quarter of 2025, total non-interest expense increased $0.8 million, or 1%.

The increase in total non-interest expense was primarily driven by increases of $0.8 million in operating lease expense, $0.6 million in net occupancy and equipment expense, driven by higher property taxes, and $0.5 million in data processing and software expense, due to costs associated with recent technology projects, partially offset by a decreases of $0.5 million in amortization of other intangible assets and $0.5 million in other non-interest expense, driven by lower corporate expenses.

The efficiency ratio for the first quarter of 2026 was 58.6%, compared to 57.8% for the linked quarter and 60.7% for the first quarter of 2025.

The efficiency ratio increased slightly compared to the linked quarter mainly as the result of higher non-interest expense, driven by increased salaries and employee benefits costs.

Peoples recorded income tax expense of $8.3 million with an effective tax rate of 22.3% for the first quarter of 2026, compared to income tax expense of $6.2 million with an effective tax rate of 16.4% for the linked quarter, and income tax expense of $7.0 million with an effective tax rate of 22.4% for the first quarter of 2025.

T he increase in income tax expense and the effective tax rate when compared to the linked quarter was impacted by updates to state apportionment in the fourth quarter of 2025, reducing expense by $0.9 million, and a $0.7 million benefit relating to tax credits purchased in the linked quarter.

The increase in income tax expense when compared to the quarter ended March 31, 2025 was driven by higher pretax income.

Total assets were $9.65 billion as of March 31, 2026, $9.65 billion at December 31, 2025, and $9.25 billion at March 31, 2025.

Total assets at March 31, 2026 remained flat when compared to at December 31, 2025 due to an increase in total loan and leases

largely offset by a decrease in total investment securities.

Total assets at March 31, 2026 increased compared to at March 31, 2025 due to increases of $341.7 million in total loans and leases and $83.1 million in total investment securities.

Total liabilities were $8.43 billion at March 31, 2026, down slightly from $8.44 billion at December 31, 2025, and up from $8.11 billion at March 31, 2025.

The decrease in total liabilities when compared to at December 31, 2025 was primarily due to a decrease of $24.4 million in short-term borrowings and a decrease of $18.7 million in long-term borrowings, partially offset by an increase of $38.2 million in period-end total deposits.

The increase in total liabilities when compared to at March 31, 2025 was primarily due increases of $486.6 million in short-term borrowings, partially offset by a decrease of $86.3 million in period-end deposits.

The decrease in total deposits was primarily driven by a decrease of $196.4 million in brokered deposits, partially offset by increases of $60.2 million in non-interest bearing deposits, $24.7 million in interest-bearing demand accounts, and $24.0 million in savings accounts.

Total stockholders' equity at March 31, 2026 increased $9.4 million compared to at December 31, 2025, which was primarily due to net income for the quarter of $29.0 million, partially offset by dividends paid of $14.7 million and an increase of $5.4 million in accumulated other comprehensive loss.

Accumulated unrealized losses related to the available-for-sale investment securities portfolio were $76.4 million and $71.0 million at March 31, 2026 and at December 31, 2025, respectively.

Total stockholders' equity at March 31, 2026 increased by $78.2 million compared to at March 31, 2025 and was impacted by net income of $111.4 million in the last twelve months and a decrease in accumulated other comprehensive loss of $19.6 million, partially offset by dividends paid of $58.6 million.

RESULTS OF OPERATIONS

5 unchanged sentences

The following table details the calculation of FTE net interest income:

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

4 unchanged sentences

For the Three Months Ended

September 30, 2025 June 30, 2025 September 30, 2024

March 31, 2026 December 31, 2025 March 31, 2025

( Dollars in thousands)

51 unchanged sentences

Net interest margin (b) 4.16 % 4.12 % 4.12 %

For the Nine Months Ended

September 30, 2025 September 30, 2024

( Dollars in thousands)

Average Balance Income/ Expense Yield/Cost Average Balance Income/ Expense Yield/Cost

Short-term investments $ 82,135 $ 2,720 4.43 % $ 125,720 $ 5,377 5.71 %

Investment securities (a)(b):

Taxable 1,766,903 48,897 3.69 % 1,685,945 43,997 3.48 %

Nontaxable 175,669 3,627 2.75 % 181,058 3,778 2.78 %

Total investment securities 1,942,572 52,524 3.61 % 1,867,003 47,775 3.41 %

Loans (b)(c):

Construction 327,512 17,266 6.95 % 333,048 19,652 7.75 %

Commercial real estate, other 2,108,596 101,444 6.34 % 2,066,631 111,302 7.08 %

Commercial and industrial 1,363,990 71,727 6.93 % 1,229,491 72,142 7.71 %

Premium finance 266,808 17,148 8.48 % 253,383 16,362 8.48 %

Leases 389,933 30,004 10.15 % 418,084 35,970 11.30 %

Residential real estate (d) 973,555 37,906 5.19 % 925,756 34,892 5.03 %

Home equity lines of credit 239,401 13,687 7.64 % 224,648 13,745 8.17 %

Consumer, indirect 688,234 33,130 6.44 % 664,610 29,322 5.89 %

Consumer, direct 120,411 7,042 7.82 % 121,359 6,465 7.12 %

Total loans 6,478,440 329,354 6.73 % 6,237,010 339,852 7.19 %

Allowance for credit losses

(67,619) (64,052)

Net loans 6,410,821 329,354 6.80 % 6,172,958 339,852 7.26 %

Total earning assets 8,435,528 384,598 6.04 % 8,165,681 393,004 6.36 %

Goodwill and other intangible assets 398,956 407,858

Other assets 521,144 541,510

$ 9,355,628 $ 9,115,049

Interest-bearing deposits:

Savings accounts $ 886,316 $ 633 0.10 % $ 889,629 $ 675 0.10 %

Governmental deposit accounts

793,581 14,271 2.40 % 795,019 16,639 2.80 %

Interest-bearing demand accounts

1,081,313 1,703 0.21 % 1,092,407 1,538 0.19 %

Money market accounts 935,873 16,554 2.36 % 829,825 15,917 2.56 %

Retail CDs 1,981,959 54,762 3.69 % 1,730,818 54,472 4.20 %

Brokered CDs (e) 471,325 15,007 4.26 % 486,832 15,727 4.32 %

Total interest-bearing deposits

6,150,367 102,930 2.24 % 5,824,530 104,968 2.41 %

Borrowed funds:

Short-term FHLB advances (e) 127,945 4,285 4.48 % 156,666 6,452 5.50 %

Repurchase agreements and other 57,442 1,655 3.84 % 214,760 8,005 4.97 %

Total short-term borrowings 185,387 5,940 4.28 % 371,426 14,457 5.19 %

Long-term FHLB advances 131,585 3,946 4.01 % 130,246 3,886 3.99 %

Long-term notes payable 46,628 2,530 7.23 % 48,890 2,547 6.95 %

Other long-term borrowings (f) 55,255 4,229 10.09 % 54,207 3,959 9.60 %

Total long-term borrowings 233,468 10,705 6.09 % 233,343 10,392 5.91 %

Total borrowed funds 418,855 16,645 5.29 % 604,769 24,849 5.47 %

Total interest-bearing liabilities

6,569,222 119,575 2.43 % 6,429,299 129,817 2.70 %

Non-interest-bearing deposits 1,530,040 1,482,318

Other liabilities 111,926 131,998

Total liabilities 8,211,188 8,043,615

Total stockholders’ equity 1,144,440 1,071,434

Total liabilities and stockholders’ equity $ 9,355,628 $ 9,115,049

Interest rate spread (b) $ 265,023 3.61 % $ 263,187 3.66 %

Net interest margin (b) 4.15 % 4.24 %

(a) Average balances are based on carrying value.

6 unchanged sentences

(e) Interest related to interest rate swap transactions is included, as appropriate to the transaction, in interest expense on short-term FHLB advances and interest expense on brokered CDs for the periods presented in which interest payments on FHLB advances or brokered CDs were being hedged.

(f) Included in other long-term borrowings are trust preferred securities and floating rate junior subordinated deferrable interest debentures.

Peoples' deposit balances have increased primarily due to an increase in retail certificates of deposits driven by special promotional rate offerings over the past year.

(f) Included in other long-term borrowings are trust preferred securities and floating rate junior deferrable interest debentures.

The following table provides an analysis of the changes in FTE net interest income:

Three Months Ended September 30, 2025 Compared to

Nine Months Ended September 30, 2025 Compared to

(Dollars in thousands) June 30, 2025 September 30, 2024 September 30, 2024

Three Months Ended March 31, 2026 Compared to

(Dollars in thousands) December 31, 2025 March 31, 2025

Increase (decrease) in:

1 unchanged sentence

Rate Volume Total (a)

INTEREST INCOME:

31 unchanged sentences

(b) Interest income and yields are presented on a fully tax-equivalent basis, using a 21% statutory federal corporate income tax rate.

Net interest income was $91.3 million for the third quarter of 2025 and increased $3.8 million when compared to the linked quarter.

Net interest margin was 4.16% for the third quarter of 2025, compared to 4.15% for the linked quarter.

The increase in net interest income and margin was primarily driven by higher loan balances and higher yields on investment securities, respectively.

Net interest income for the third quarter of 2025 increased $2.4 million, or 3%, compared to the third quarter of 2024.

Net interest margin decreased 11 basis points when compared to the third quarter of 2024.

The increase in net interest income was primarily driven by growth in loan portfolios and reduced deposit costs.

The decrease in net interest margin was driven by reductions in loan yields, attributable to lower accretion income.

For the first nine months of 2025, net interest income increased $2.0 million compared to the first nine months of 2024, while net interest margin decreased 9 basis points to 4.15%.

The decrease in net interest margin for the first nine months of 2025 compared to the first nine months of 2024 was primarily driven by lower accretion income.

Accretion income, net of amortization expense, from acquisitions was $1.7 million for the third quarter of 2025, $2.6 million for the linked quarter and $8.1 million for the third quarter of 2024, which added 8 basis points, 12 basis points and 39 basis points, respectively, to net interest margin.

Accretion income, net of amortization expense, was $7.8 million and $20.3 million for the first nine months of 2025 and 2024, respectively.

Accretion income added 12 basis points and 33 basis points to net interest margin for the first nine months of 2025 and 2024, respectively.

The decrease in accretion income for the first nine months of 2025 compared to the same period in 2024 was due to less accretion recognized from the Limestone Merger.

Net interest income was $90.4 million for the first quarter of 2026 a decrease of $0.6 million when compared to the linked quarter.

Net interest margin was 4.16% for the first quarter of 2026, compared to 4.12% for the linked quarter.

The decrease in net interest

income was primarily driven by a decrease in accretion income coupled with fewer days in the quarter compared to the linked quarter.

The increase in net interest margin was driven by a reduction in deposit costs.

Net interest income for the first quarter of 2026 increased $5.2 million, or 6%, compared to the first quarter of 2025.

Net interest margin increased 4 basis points when compared to the first quarter of 2025.

The increase in net interest income and net interest margin was primarily driven by lower deposit and borrowing costs.

Accretion income, net of amortization expense, was $1.3 million for the first quarter of 2026, $1.8 million for the linked quarter and $3.5 million for the first quarter of 2025, which added 6 basis points, 8 basis points and 17 basis points, respectively, to net interest margin.

The decrease in accretion income for the first quarter of 2026 when compared to the first quarter of 2025 was driven by less accretion recognized in the current period from the 2023 Limestone Merger.

Additional information regarding changes in the Unaudited Consolidated Balance Sheets can be found under appropriate captions of the “FINANCIAL CONDITION” section of this MD&A.

2 unchanged sentences

The following table details Peoples’ provision for credit losses:

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

3 unchanged sentences

The provision for credit losses recorded represents the amount needed to maintain the appropriate level of the allowance for credit losses based on management’s quarterly estimates.

The provision for credit losses for the linked quarter of 2025 was primarily driven by (i) net charge offs, (ii) an increase in reserves for individually analyzed loans and leases, (iii) an increase in reserves for leases originated by our North Star Leasing division, (iv) a periodic refresh in loss drivers utilized within the CECL model, (v) deterioration in the economic forecasts used within the CECL model, and (vi) loan growth.

For the first nine months of 2025, the provision for credit losses was mainly a result of (i) net charge offs, (ii) an increase in reserves for individually analyzed loans and leases, (iii) an increase in reserves for leases originated by our North Star Leasing division, (iv) deterioration in the economic forecasts used within the CECL model, and (v) loan growth.

For the same period of 2024, the provision for credit losses was driven by (i) net charge-offs, (ii) an increase in reserves for individually analyzed loans and leases, (iii) economic forecast deterioration, and (iv) loan growth.

The provision for credit losses for the first quarter of 2026 was primarily driven by net charge-offs and a deterioration in the economic forecasts used within the CECL model.

The provision for credit losses for the linked quarter of 2025 was primarily driven by (i) net charge-offs, (ii) loan growth, and (iii) a slight deterioration in the economic forecasts used within the CECL model, partially offset by reductions in reserves for individually analyzed loans and leases.

Additional information regarding changes in the allowance for credit losses and loan credit quality can be found later in this MD&A under the caption “FINANCIAL CONDITION - Allowance for Credit Losses.”

2 unchanged sentences

The following table details Peoples’ net losses for the periods presented:

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

2 unchanged sentences

Net loss on other assets (384) (210) (330)

Net gain (loss) on OREO — 10 (2) 30 (2)

Net (loss) gain on OREO (26) (851) 20

Net loss on other transactions — (847) (51)

Net loss on asset disposals and other transactions $ (410) $ (1,908) $ (361)

The net loss on investment securities for the third quarter of 2025 was driven by the sale of lower-yielding available for sale securities.

The net loss on investment securities reported for the third quarter of 2024 was attributable to a loss recorded on a contingent call of a security.

The net loss on other assets for all periods presented was driven by losses recorded on repossessed assets.

The net loss on other assets for the first quarter of 2026 was driven by losses on repossessed assets.

The net losses for the linked quarter were primarily driven by a $0.9 million net loss on the sale of an OREO property and a $0.8 million loss on the redemption of subordinated debt.

The net loss on other assets reported for the first quarter of 2025 was driven by the losses recorded on repossessed assets.

Total Non-Interest Income, Excluding Net Gains and Losses

Total non-interest income, excluding net gains and losses, comprised 23% of Peoples' total revenues (defined as net interest income plus total non-interest income excluding net gains and losses) for the third quarter of 2025, 24% for the linked quarter, and 22% for the third quarter of 2024.

For the first nine months of 2025, total non-interest income, excluding net gains and losses, totaled 24% of total revenue compared to 23% for the same period in 2024.

For the third quarter of 2025, e-banking income comprised the largest portion of Peoples' total non-interest income, excluding net gains and losses.

Total non-interest income, excluding net gains and losses, comprised 24% of Peoples' total revenues (defined as net interest income plus total non-interest income excluding net gains and losses) for the first quarter of 2026, consistent with the linked quarter and the first quarter of 2025.

For the first quarter of 2026, e-banking income comprised the largest portion of Peoples' total non-interest income, excluding net gains and losses.

Peoples' e-banking services include ATM and debit cards, direct deposit services, internet and mobile banking, and remote deposit capture, and serve as alternative delivery channels to traditional sales offices for providing services to customers.

The following table details Peoples' e-banking income:

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

3 unchanged sentences

The following table details Peoples' insurance income:

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

4 unchanged sentences

Life and health insurance commissions

652 659 687 2,000 2,059

Insurance income $ 5,580 $ 4,520 $ 6,054

Peoples' insurance income for the third quarter of 2025 decreased slightly when compared to the linked quarter.

Insurance income for the third quarter of 2025 increased when compared to the third quarter of 2024 due to higher commissions.

Insurance income in the first nine months of 2025 increased compared to the same period of 2024 due to higher commissions.

Peoples' insurance income for the first quarter of 2026 increased $1.1 million when compared to the linked quarter due to seasonal performance-based commissions paid in the first quarter of each year.

Insurance income for the first quarter of 2026 decreased $0.5 million when compared to the first quarter of 2025 due to lower commissions based on the performance of the policies written during 2025.

Peoples' trust and investment income, which includes fiduciary income, brokerage income, and employee benefit fees, continued to be based primarily upon the value of assets under administration and management, with additional income generated from transaction commissions, cross-selling of products and additional retirement plan services business.

The following table details Peoples’ trust and investment income:

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

3 unchanged sentences

Trust and investment income $ 5,605 $ 5,692 $ 5,061

Brokerage income in the third quarter of 2025 increased when compared to the linked quarter and to the third quarter of 2024 and was driven by an increase in assets under administration and management.

Trust and investment income increased $1.3 million for the first nine months of 2025 when compared to 2024, due to higher brokerage income, primarily reflecting the increase in assets under management.

Brokerage income in the first quarter of 2026 remained flat when compared to the linked quarter and increased compared to the first quarter of 2025 which was driven by an increase in assets under administration and management.

The following table details Peoples' assets under administration and management:

2026 December 31,

2025 September 30,

1 unchanged sentence

2025 March 31,

2025 December 31,

2024 September 30,

(Dollars in thousands)

3 unchanged sentences

Quarterly average $ 4,091,841 $ 4,065,195 $ 3,955,007 $ 3,736,778 $ 3,711,527

The increase in assets under administration and management at September 30, 2025 compared to at June 30, 2025 was driven by market value fluctuations.

The increase in assets under administration and management at September 30, 2025 when compared to at September 30, 2024 was primarily due to growth, as Peoples added new accounts and the underlying market values of assets under management grew.

The decrease in assets under administration and management at March 31, 2026 compared to at December 31, 2025 was driven by market value fluctuations.

The increase in assets under administration and management at March 31, 2026 when compared to at March 31, 2025 was primarily due to growth, as Peoples added new accounts and the underlying market values of assets under management grew.

Deposit account service charges are based on the recovery of costs associated with services provided.

The following table details Peoples' deposit account service charges:

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

5 unchanged sentences

Management periodically evaluates its cost recovery fees to ensure they are reasonable based on operational costs and similar to fees charged in Peoples' markets by competitors.

Deposit account service charges increased slightly for the third quarter of 2025 compared to the linked quarter.

Deposit account service charges decreased when comparing the third quarter of 2025 to the third quarter of 2024.

For the first nine months of 2025, total deposit account service charges decreased by $0.7 million from the same period of 2024, driven by timing of customer activity.

Deposit account service charges decreased for the first quarter of 2026 compared to the linked quarter due to the seasonality of customer activity.

Deposit account service charges increased when comparing the first quarter of 2026 to the first quarter of 2025 due to higher maintenance fees driven by the volume of accounts.

The following table details the other items included within Peoples' total non-interest income:

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

3 unchanged sentences

Mortgage banking income 376 537 396

Lease income is primarily comprised of (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 beyond maturity of the net investment in the lease, net of any associated purchase accounting adjustment, (iv) fees received for referrals, (v) gains and losses recognized on the sales of

residual assets, net of any purchase accounting impact, and (vi) syndication income.

Lease income for the third quarter of 2025 decreased compared to the linked quarter due to gains on early terminated Vantage leases recognized in the linked quarter.

The increase when compared to the third quarter of 2024 was driven by increases in operating lease income and month-to-month lease income.

Lease income increased $4.0 million for the first nine months of 2025 when compared to the same period of 2024 due to increases in month-to-month lease income and operating lease income.

Other non-interest income decreased for the three months ended September 30, 2025 when compared to the linked quarter and remained relatively flat compared to the third quarter of 2024.

For the first nine months of 2025, other non-interest income increased by $1.0 million from the same period of 2024, primarily due to the increase in swap fee income which is driven by customer demand.

BOLI income for the third quarter of 2025 remained flat when compared to the linked quarter and increased $0.7 million when compared to the prior year quarter.

BOLI income increased for the first nine months of 2025 when compared to the same period of 2024 primarily due to changes in the cash surrender value of the underlying policies.

Lease income for the first quarter of 2026

increased compared to the linked quarter due to operating lease income.

The increase when compared to the first quarter of 2025 was driven by increases in operating lease income and gains on early terminated Vantage leases.

Other non-interest income remained relatively flat for the first quarter of 2026 when compared to the linked quarter and decreased when compared to the first quarter of 2025 due to lower swap fee income which is driven by customer demand.

BOLI income for the first quarter of 2026 remained flat when compared to the linked quarter and to the prior year quarter.

Mortgage banking income is comprised mostly of net gains from the origination and sale of real estate loans in the secondary market, and, to a lesser extent, servicing income for loans sold with servicing retained.

As a result, the amount of income recognized by Peoples is largely dependent on customer demand and long-term interest rates for residential real estate loans offered in the secondary market.

Mortgage banking income for the third quarter of 2025 decreased when compared to the third quarter of 2024 and was primarily driven by the decreased volume in loans sold as more production has been kept on the balance sheet relative to prior periods.

Mortgage banking income decreased for the first nine months of 2025 when compared to the same period of 2024 due to lower production.

In the third quarter of 2025, Peoples sold $4.5 million in loans into the secondary market with servicing retained and $3.8 million in loans with servicing released, compared to $0.3 million and $10.2 million, respectively, in the second quarter of 2025, and $14.9 million and $12.0 million, respectively, in the third quarter of 2024.

For the first nine months of 2025, Peoples sold $5.0 million in loans into the secondary market with servicing retained, and $18.8 million with servicing released, compared to $17.6 million and $30.8 million, respectively, for the same period of 2024.

Mortgage banking income for the first quarter of 2026 decreased when compared to the linked quarter and was primarily driven by the decreased volume in loans sold as more production was kept on the balance sheet relative to prior periods.

In the first quarter of 2026, Peoples sold $6.0 million in loans into the secondary market with servicing retained and $3.6 million in loans with servicing released, compared to $8.6 million and $8.7 million, respectively, in the fourth quarter of 2025, and $0.2 million and $4.7 million, respectively, in the first quarter of 2025.

Non-Interest Expense

1 unchanged sentence

The following table details Peoples' salaries and employee benefit costs:

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

9 unchanged sentences

Average during the period 1,457 1,452 1,467

Base salaries and wages for the third quarter of 2025 and the first nine months of 2025 increased compared to the same periods in 2024, primarily driven by annual merit increases.

Sales-based and incentive compensation increased for the third quarter of 2025 compared to the linked quarter and the third quarter of 2024 and was driven by an increase in corporate incentives.

Sales-based and incentive compensation increased for the first nine months of 2025 when compared to 2024, due to an increase in corporate incentives and insurance commissions.

The decrease in employee benefits for the third quarter of 2025 compared to the linked quarter was primarily related to lower medical costs and an adjustment related to prior period nonqualified deferred compensation expense.

Employee benefits increased for the third quarter of 2025 and the first nine months of 2025 when compared to the same periods for 2024 due to higher medical costs.

Payroll taxes and other employment costs for the third quarter of 2025 and for the first nine months of 2025 increased slightly when compared to all prior periods.

Base salaries and wages for the first quarter of 2026 increased compared to the linked quarter and to the first quarter of 2025, primarily driven by annual merit increases.

Sales-based and incentive compensation decreased for the first quarter of 2026 compared to the linked quarter and the same period of 2025 and was driven by a decrease in corporate incentives.

The increase in employee benefits for the first quarter of 2026 compared to the linked quarter and to the first quarter of 2025 was primarily related to higher medical costs.

Payroll taxes and other employment costs for the first quarter of 2026 increased compared to the linked quarter due to the seasonal expenses recognized in the first quarter of each year.

Stock-based compensation is generally recognized over the vesting period, which generally ranges from immediate vesting to vesting at the end of three years.

5 unchanged sentences

As a result, the amount of deferred personnel costs for each period corresponds directly with the volume of loan originations, coupled with the average deferred costs per loan that are updated annually at the beginning of each year.

Deferred personnel costs for the third quarter of 2025 increased when compared to the second quarter of 2025 and to the third quarter of 2024.

Similarly, deferred personnel costs increased for the first nine months of 2025 when compared to 2024.

Deferred personnel costs for the first quarter of 2026 decreased when compared to the fourth quarter of 2025 and increased compared to the first quarter of 2025, which is driven by loan volume.

Peoples' net occupancy and equipment expense was comprised of the following:

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

4 unchanged sentences

Net occupancy and equipment expense $ 6,224 $ 5,980 $ 5,612

Net occupancy and equipment expense remained roughly flat for the third quarter compared to the linked quarter and compared to the third quarter of 2024.

Net occupancy and equipment expense for the first nine months of 2025 decreased when compared to the same period of the previous year due to an adjustment of property tax accruals resulting from a review of recent assessments.

Net occupancy and equipment expense increased for the first quarter of 2026 compared to the linked quarter and the first quarter of 2025 due to increased property taxes.

The following table details the other items included in total non-interest expense:

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

11 unchanged sentences

Other non-interest expense 4,110 4,166 4,603

Data processing and software expenses for the third quarter and the first nine months of 2025 increased compared to the same periods in 2024 due to costs associated with recent technology projects.

Professional fees for the third quarter of 2025 decreased when compared to the linked quarter due to decreased professional services.

Professional fees increased for the first nine months of 2025 when compared to 2024 due to increased legal expenses and higher exam and audit fees.

Amortization of other intangible assets for the third quarter of 2025 remained flat compared to the linked quarter and decreased $0.6 million compared to the prior year quarter due to decreases in amortization on core deposits and customer relationship intangibles.

Amortization of other intangible assets decreased for the first nine months of 2025 when compared to 2024 due to decreases in amortization on core deposits and customer relationship intangibles.

Data processing and software expenses for the first quarter of 2026 increased compared to the linked quarter and same period in 2025 due to costs associated with recent technology projects.

Professional fees for the first quarter of 2026 decreased when compared to the linked quarter and same period of 2025 due to decreased legal expenses.

Amortization of other intangible assets for the first quarter of 2026 decreased $0.5 million compared to the linked quarter and to the prior year quarter due to decreases in amortization on core deposits and customer relationship intangibles.

Peoples' e-banking expense is comprised of costs associated with debit and ATM cards and is driven by the timing and volume of customer activity.

E-banking expense increased slightly compared to the linked quarter and the third quarter of 2024.

E-banking expense increased for the first nine months of 2025 when compared to 2024 due to customer activity.

Peoples' FDIC insurance premiums for the third quarter of 2025 were flat when compared to the linked quarter and the third quarter of 2024.

FDIC premiums increased slightly for the first nine months of 2025 when compared to 2024.

Other loan expenses during the third quarter of 2025 remained relatively flat when compared to the linked quarter and increased slightly compared to the third quarter of 2024.

Other loan expenses increased for the first nine months of 2025 when compared to 2024 due to increased down payment assistance expenses.

Operating lease expense remained flat when compared to the linked quarter and the third quarter of 2024.

Operating lease expense increased for the first nine months of 2025 when compared to 2024 due to an increased volume of leases.

Marketing expense for the third quarter of 2025 increased when compared to the linked quarter primarily driven by a vendor credit received in the second quarter.

Marketing expense decreased for the first nine months of 2025 when compared to 2024 due to lower advertising expenses.

Travel and entertainment expenses remained flat compared to the linked quarter and to the third quarter of 2024.

Travel and entertainment increased slightly for the first nine months of 2025 when compared to 2024 due to timing of travel.

Communication expense decreased for the third quarter of 2025 when compared to both the linked quarter and the same period of the prior year.

Communication expense decreased slightly for the first nine months of 2025 when compared to 2024.

E-banking expense remained flat compared to both the linked quarter and the first quarter of 2025.

Peoples' FDIC insurance premiums for the first quarter of 2026 increased slightly due to an increase in average assets when compared to the linked quarter and the first quarter of 2025.

Other loan expenses during the first quarter of 2026 decreased slightly when compared to the linked quarter and remained flat when compared to the first quarter of 2025.

The decrease compared to the linked quarter was driven by decreased business loan filing fees.

Operating lease expense, which is the depreciation of operating lease assets, increased when compared to the linked quarter and the first quarter of 2025, driven by the increased volume of leases.

Marketing expense for the first quarter of 2026 decreased when compared to the linked quarter primarily driven by lower advertising expense.

Travel and entertainment expenses remained flat compared to the linked quarter and to the first quarter of 2025.

Communication expense remained flat for the first quarter of 2026 when compared to the linked quarter and decreased compared to the first quarter of 2025 due to branch-related costs.

Peoples is subject to state franchise taxes, which are based largely on Peoples' equity, in the states where Peoples has a physical presence.

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The Ohio FIT is based on the total equity capital in proportion to the taxpayer's gross receipts in Ohio as of the most recent year-end.

The increase in franchise tax expense for the third quarter of 2025 compared to the linked quarter related to a one-time refund from the State of Ohio.

Franchise tax expense remained flat for the first nine months of 2025 when compared to 2024.

Other non-interest expense for the third quarter of 2025 decreased when compared to the linked quarter primarily due to lower corporate expenses.

Other non-interest expense increased for the third quarter and the first nine months of 2025 when compared to same periods in 2024 due to increased expense on operating leases.

The increase in franchise tax expense for the first quarter of 2026 compared to the linked quarter driven by increased rates.

Other non-interest expense for the first quarter of 2026 remained flat when compared to the linked quarter and decreased compared to the first quarter of 2025 primarily due to lower corporate expenses.

Income Tax Expense

Peoples recorded income tax expense of $8.5 million with an effective tax rate of 22.4% for the third quarter of 2025, compared to income tax expense of $6.2 million with an effective tax rate of 22.7% for the linked quarter and income tax expense of $9.2 million with an effective tax rate of 22.5% for the third quarter of 2024.

The increase in income tax expense when compared to the prior quarter was primarily due to higher pre-tax income.

The effective tax rate compared to the prior year quarter was relatively flat.

Peoples recorded income tax expense of $21.8 million and $24.3 million, through the first nine months of 2025 and 2024, respectively.

The decrease for the first nine months of 2025 compared to 2024 was driven by lower pre-tax income.

Additional information regarding income taxes can be found in "Note 13.

Income Taxes" of the Notes to the Consolidated Financial Statements included in Peoples' 2024 Form 10-K.

Peoples recorded income tax expense of $8.3 million with an effective tax rate of 22.3% for the first quarter of 2026, compared to income tax expense of $6.2 million with an effective tax rate of 16.4% for the linked quarter and income tax expense of $7.0 million with an effective tax rate of 22.4% for the first quarter of 2025.

The increase in income tax expense and the effective tax rate when compared to the linked quarter was impacted by updates to state apportionment in the fourth quarter of 2025, reducing expense by $0.9 million, and a $0.7 million benefit relating to tax credits purchased in the linked quarter.

The increase in income tax expense when compared to March 31, 2025 was driven by higher pretax income.

Additional information regarding income taxes can be found in "Note 13 Income Taxes" of the Notes to the Consolidated Financial Statements included in Peoples' 2025 Form 10-K.

Pre-Provision Net Revenue (Non-US GAAP)

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The following table provides a reconciliation of this Non-US GAAP financial measure to the amounts reported in Peoples' Unaudited Condensed Consolidated Financial Statements for the periods presented:

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

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Pre-provision net revenue $ 47,449 $ 48,012 $ 41,930

The increase in the PPNR for the third quarter of 2025 compared to the linked quarter was driven by an increase in net interest income due to higher income on loans and investment securities.

PPNR for the first nine months of 2025 decreased slightly compared to 2024, primarily driven by lower accretion income, partially offset by lower funding costs.

The decrease in the PPNR for the first quarter of 2026 compared to the linked quarter was driven by a decrease in net interest income due to less days in the quarter compared to the linked quarter coupled with lower accretion income.

PPNR for the first quarter of 2026 increased compared to the first quarter of 2025, primarily due to higher net interest income, driven by lower borrowing and deposit costs.

Efficiency Ratio (Non-US GAAP)

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The efficiency ratio is calculated as total non-interest expense (less amortization of other intangible assets) as a percentage of FTE net interest income plus total non-interest income excluding net gains and losses.

This measure is Non-US GAAP since it excludes amortization of other intangible assets and all gains and losses included in earnings, and uses FTE net interest income.

This measure represents a Non-US GAAP financial measure since it excludes amortization of other intangible assets and all gains and losses included in earnings, and uses FTE net interest income.

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

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(a) Interest income and yields are presented on a fully tax-equivalent basis, using a 21% statutory federal corporate income tax rate.

The efficiency ratio for the third quarter of 2025 was 57.1%, compared to 59.3% for the linked quarter and 55.1% for the third quarter of 2024.

The efficiency ratio improved compared to the linked quarter mainly as the result of higher net interest income and lower non-interest expenses.

The efficiency ratio increased compared to the prior year first nine months due to the increase in non-interest expense.

Peoples continues to focus on controlling expenses, while recognizing necessary costs in order to continue growing the business.

The efficiency ratio for the first quarter of 2026 was 58.6%, compared to 57.8% for the linked quarter and 60.7% for the first quarter of 2025.

The efficiency ratio increased compared to the linked quarter mainly due to an increase in non-interest expenses resulting from certain expenses that are usually recognized in the first quarter of each year, coupled with lower accretion income.

Return on Average Assets Adjusted for Non-Core Items Ratio (Non-US GAAP)

2 unchanged sentences

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

2 unchanged sentences

net loss on investment securities

2,580 — 74 2,582 428

tax effect of net loss on investment securities (a)

542 — 16 542 90

net loss on asset disposals and other transactions

1 unchanged sentence

tax effect of net loss on asset disposals and other transactions (a)

100 59 167 235 328

acquisition-related expenses

— — (662) — (746)

tax effect of acquisition-related expenses (a)

— — (139) — (157)

Net income adjusted for non-core items (after tax)

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(a) Based on a 21% statutory federal corporate income tax rate.

The return on average assets and the return on average assets adjusted for non-core items for the third quarter of 2025 increased when compared to the linked quarter due to higher annualized net income.

The decrease in the return on average assets and return on average assets adjusted for non-core items for the third quarter of 2025, compared to the third quarter of 2024, was attributable to a decrease in annualized net income driven by an increase in provision for credit losses and an increase in average assets.

The decrease in return on average assets and return on average assets adjusted for non-core items for the first nine months of 2025 when compared to the same period of 2024 was primarily driven by a decrease in annualized net income from an increase in provision for credit losses and an increase in average assets.

The return on average assets and the return on average assets adjusted for non-core items for the first quarter of 2026 decreased when compared to the linked quarter due to lower annualized net income which was driven by lower interest income, attributable to fewer days in the period and less accretion income.

The increase in the return on average assets and return on average assets adjusted for non-core items for the first quarter of 2026, compared to the first quarter of 2025, was attributable to an increase in annualized net income driven by an increase in net interest income.

Return on Average Tangible Equity Ratio (Non-US GAAP)

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measure is Non-US GAAP since it excludes amortization of other intangible assets from earnings and the impact of goodwill and other intangible assets acquired through acquisitions on total stockholders' equity.

Three Months Ended Nine Months Ended

September 30,

2025 June 30,

2025 September 30,

2024 September 30,

Three Months Ended

2026 December 31,

2025 March 31,

(Dollars in thousands)

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tax effect of amortization of other intangible assets (a)

464 464 585 1,393 1,756

Net income excluding amortization of other intangible assets

1 unchanged sentence

Days in the period

92 91 92 273 274

Days in the year

365 365 366 365 366

Annualized net income

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(a) Based on a 21% statutory federal corporate income tax rate.

The return on total average stockholders' equity and average tangible equity ratios increased when compared to the linked quarter due to an increase in annualized net income.

The decreases in the return on total average stockholders' equity and average tangible equity ratios for the third quarter and the first nine months of 2025 compared to the same periods of 2024 were driven by lower net income.

The return on total average stockholders' equity and average tangible equity ratios decreased when compared to the linked quarter due to a decrease in annualized net income, which was driven by lower interest income, attributable to fewer days in the period and less accretion income.

The increases in the return on total average stockholders' equity and average tangible equity ratios for the first quarter of 2026 compared to the same period of 2025 were driven by higher net income due to increased net interest income.

FINANCIAL CONDITION

Cash and Cash Equivalents

At September 30, 2025, Peoples' interest-bearing deposits in other banks had decreased $39.7 million from December 31, 2024.

The total cash and cash equivalents balance included $62.9 million of excess cash reserves being maintained at the FRB of Cleveland at September 30, 2025, compared to $104.7 million at December 31, 2024.

At March 31, 2026, Peoples' cash and balances due from banks increased by $4.4 million, while interest-bearing deposits in other banks decreased $3.0 million from December 31, 2025.

The total cash and cash equivalents balance included $67.9 million of excess cash reserves being maintained at the FRB of Cleveland at March 31, 2026, compared to $73.2 million at December 31, 2025.

The amount of excess cash reserves maintained is dependent upon Peoples' daily liquidity position, which is driven primarily by changes in deposit and loan balances.

Through the first nine months of 2025, Peoples' total cash and cash equivalents decreased $27.4 million, which reflected cash outflows of $403.4 million for investing activities, partially offset by cash inflows of $276.5 million for financing activities and $99.4 million from operating activities.

Peoples' use of cash in investing activities reflected a $384.5 million net increase in loans held for investment and net cash outflows of $156.1 million related to the purchases of held-to-maturity investment securities.

These were offset by net cash inflows from the sale of available-for-sale investment securities of $147.4 million.

The cash provided by financing activities was driven by a net increase in short-term borrowings of $290.1 million.

Through the first three months of 2026, Peoples' total cash and cash equivalents increased $1.4 million, driven by inflows of $34.5 million from operating activities, partially offset by cash outflows of $10.8 million for investing activities and $22.2 million for financing activities.

Peoples' use of cash in investing activities was driven by an $18.0 million net increase in loans held for investment, partially offset by net cash inflows primarily related to proceeds from investment securities principal payments.

The cash used in financing activities was driven by $43.5 million in the net change of short-term and long-term borrowings and outflows of $14.6 million for dividends paid, partially offset by an increase in non-interest bearing deposits of $41.1 million.

Further information regarding the management of Peoples' liquidity position can be found later in this discussion under “Interest Rate Sensitivity and Liquidity.”

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The following table provides information regarding Peoples’ investment portfolio:

(Dollars in thousands) Weighted Average Yield September 30,

2025 June 30,

2025 March 31,

(Dollars in thousands) Weighted Average Yield March 31,

2026 December 31,

2025 September 30,

2025 June 30,

2025 March 31,

Available-for-sale securities, at fair value:

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Carrying value $ 1,961,522 $ 1,975,860 $ 1,972,721 $ 2,019,054 $ 1,878,462

(a) Amortized cost is presented net of the allowance for credit losses of $237 at September 30, 2025 and at June 30, 2025 and $236 at September 30, 2024.

For the third quarter of 2025, available-for-sale investment securities decreased compared to all prior periods due to the sale of lower-yielding securities.

For the third quarter of 2025, held-to-maturity securities increased compared to all prior periods due to the purchases of higher-yielding, longer duration securities booked to held-to-maturity.

(a) Amortized cost is presented net of the allowance for credit losses of $233 at March 31, 2026, $236 at December 31, 2025, and $237 at March 31, 2025.

For the first quarter of 2026, available-for-sale investment securities increased when compared to the linked quarter due to purchases of additional U.S.

government sponsored securities.

Compared to at March 31, 2025, available-for-sale investment

securities decreased driven primarily by regular principal payments on residential mortgage-backed securities.

Held-to-maturity securities decreased compared to the linked quarter due to prepayments and maturities of residential mortgage-backed securities.

Compared to the prior year quarter, held-to-maturity investment securities increased because of purchases of higher-yielding, longer duration securities booked to held-to-maturity in the third quarter of 2025.

Additional information regarding Peoples' investment portfolio can be found in "Note 3 Investment Securities" of the Notes to the Unaudited Condensed Consolidated Financial Statements.

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The following table provides information regarding outstanding loan balances:

(Dollars in thousands) September 30,

2025 June 30,

2025 March 31,

(Dollars in thousands) March 31,

2026 December 31,

2025 September 30,

2025 June 30,

2025 March 31,

Originated loans and leases:

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Loans that were acquired and subsequently re-underwritten are reported as originated upon execution of such credit actions (for example, renewals and increases in lines of credit).

The period-end total loan and lease balances at September 30, 2025 increased $127.1 million, or 8% annualized, compared to at June 30, 2025.

The increase in the period-end loan and lease balances at September 30, 2025 compared to at June 30, 2025 was driven by increases of $121.2 million in other commercial real estate loans and $82.1 million in commercial and industrial loans, partially offset by a decrease of $80.3 million in construction loans.

The period-end loan and lease balances at September 30, 2025 compared to at September 30, 2024 increased $456.9 million, or 7%, compared to at September 30, 2024, driven by increases of $239.4 million in commercial and industrial loans, $188.9 million in other commercial real estate loans, and $98.2 million in residential real estate loans, partially offset by decreases of $59.0 million and $50.3 million in constructions loans and leases, respectively.

The period-end total loan and lease balances at March 31, 2026 increased $13.3 million, or 1% annualized, compared to at December 31, 2025.

The increase in the period-end loan and lease balances at March 31, 2026 compared to at December 31, 2025 was

driven by increases of $111.0 million in commercial and industrial loans, partially offset by decreases of $31.4 million in construction loans, $24.2 million in premium finance loans, and $23.1 million in other commercial real estate loans.

The period-end loan and lease balances at March 31, 2026 compared to at March 31, 2025 increased $341.7 million, or 5%, driven by increases of $303.0 million in commercial and industrial loans, $110.3 million in other commercial real estate loans, and $25.5 million in home equity lines of credit, partially offset by decreases of $49.5 million in construction loans, $45.2 million in leases, and $35.2 million in premium finance loans.

Loan Concentration

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Peoples' commercial lending activities continue to be spread over a diverse range of businesses from many sectors of the economy, with no single industry comprising over 10% of Peoples' total loan portfolio.

Loans secured by commercial real estate, including commercial construction loans, continued to comprise the largest portion of Peoples' loan portfolio at September 30, 2025.

The following tables provide information regarding the largest concentrations of commercial construction loans and other commercial real estate loans within the loan portfolio at September 30, 2025:

Loans secured by commercial real estate, including commercial construction loans, continued to comprise the largest portion of Peoples' loan portfolio at March 31, 2026.

The following tables provide information regarding the largest concentrations of commercial construction loans and other commercial real estate loans within the loan portfolio at March 31, 2026:

(Dollars in thousands) Outstanding Balance Loan Commitments Total Exposure % of Total

2 unchanged sentences

Land development 32,304 87,292 119,596 19.3 %

Land only 16,144 25,987 42,131 7.0 %

Industrial 25,906 22,419 48,325 7.8 %

Land only 12,737 28,044 40,781 6.6 %

Healthcare — 20,400 20,400 3.3 %

Residential property 2,947 16,784 19,731 3.2 %

8 unchanged sentences

Apartment complexes $ 493,086 $ 12,076 $ 505,162 21.1 %

Light industrial facilities:

Industrial facilities:

Owner occupied $ 122,881 $ 1,703 $ 124,584 5.2 %

Non-owner occupied 126,690 2,138 128,828 5.4 %

Total light industrial facilities $ 248,621 $ 10,533 $ 259,154 10.7 %

Total industrial facilities $ 249,571 $ 3,841 $ 253,412 10.6 %

Retail facilities:

23 unchanged sentences

Total mixed-use facilities $ 69,818 $ 2,823 $ 72,641 3.0 %

Healthcare facilities:

Storage Facility

Owner occupied $ 48,427 $ 196 $ 48,623 2.0 %

Non-owner occupied 4,024 447 4,471 0.2 %

Total healthcare facilities $ 55,992 $ 1,460 $ 57,452 2.3 %

Total storage facilities $ 52,451 $ 643 $ 53,094 2.2 %

Other (a) 535,157 26,520 561,677 23.4 %

3 unchanged sentences

and Maryland.

For all other states, the aggregate outstanding balances of commercial loans in each state were less than 6% of total loans at September 30, 2025 and at December 31, 2024.

For all other states, the aggregate outstanding balances of commercial loans in each state were less than 6% of total loans at March 31, 2026 and less than 4% of total loans at December 31, 2025.

The repayment of premium finance loans is secured by the underlying insurance policy prepaid premium, and therefore, geography is not a factor from a repayment perspective.

4 unchanged sentences

The following details management's allocation of the allowance for credit losses:

(Dollars in thousands) September 30,

2025 June 30,

2025 March 31,

(Dollars in thousands) March 31,

2026 December 31,

2025 September 30,

2025 June 30,

2025 March 31,

Construction $ 1,512 $ 1,391 $ 1,252 $ 1,347 $ 1,156

10 unchanged sentences

As a percent of total loans 1.16 % 1.12 % 1.11 % 1.13 % 1.01 %

The increase in the allowance for credit losses at September 30, 2025 compared to at June 30, 2025 was driven by loan growth and a slight deterioration in the economic forecasts used within the CECL model, partially offset by reductions in reserves for individually analyzed loans and leases.

Compared to at September 30, 2024, the allowance for credit losses increased due to an increase in reserves for leases originated by our North Star Leasing division, a slight deterioration in the economic forecasts used within the CECL model, and loan growth.

The increase in the allowance for credit losses at March 31, 2026 compared to at December 31, 2025 was driven by a deterioration in the economic forecasts used within the CECL model.

Compared to at March 31, 2025, the allowance for credit losses increased due to (i) loan growth, (ii) deterioration in the economic forecasts used within the CECL model, (iii) a periodic refresh in the loss drivers utilized within the CECL model, (iv) an increase in reserves for leases originated by the North Star Leasing division, and (v) an increase in individually analyzed loans and leases.

Additional information regarding Peoples' allowance for credit losses can be found in "Note 1 Summary of Significant Accounting Policies" in Peoples' 2025 Form 10-K and "Note 4 Loans and Leases" of the Notes to the Unaudited Condensed Consolidated Financial Statements in this Form 10-Q.

1 unchanged sentence

Three Months Ended

(Dollars in thousands) September 30,

2025 June 30,

2025 March 31,

(Dollars in thousands) March 31,

2026 December 31,

2025 September 30,

2025 June 30,

2025 March 31,

Gross charge-offs:

10 unchanged sentences

Total gross charge-offs $ 7,759 $ 8,391 $ 7,841 $ 7,829 $ 8,760

Construction $ — $ 25 $ — $ — $ —

Commercial real estate, other — 59 1 — 4

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Net charge-offs (recoveries):

Construction $ — $ (25) $ — $ — $ —

Commercial real estate, other — (41) 26 35 211

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Ratio of net charge-offs (recoveries) to average total loans (annualized):

Construction — % — % — % — % — %

Commercial real estate, other — % — % — % — % 0.01 %

Three Months Ended

(Dollars in thousands) March 31,

2026 December 31,

2025 September 30,

2025 June 30,

2025 March 31,

Commercial and industrial 0.02 % 0.02 % 0.03 % 0.03 % 0.02 %

9 unchanged sentences

Each with "--%" not meaningful.

Total net charge-offs during the third quarter of 2025 were $6.8 million, or 0.41% of average total loans on an annualized basis, compared to $7.0 million, or 0.43% of average total loans on an annualized basis, during the linked quarter and $6.1 million, or 0.38% of average total loans on an annualized basis, during the third quarter of 2024.

Compared to the linked quarter, net charge-offs decreased slightly, primarily driven by a decrease in net charge-offs in leases originated by the North Star Leasing business.

The increase in net charge-offs during the third quarter of 2025 versus the prior year third quarter was primarily attributable to an increase in charge-offs in leases originated by the North Star Leasing business.

Total net charge-offs during the first quarter of 2026 were $6.6 million, or 0.40% of average total loans on an annualized basis, compared to $7.4 million, or 0.44% of average total loans on an annualized basis during the linked quarter, and $8.1 million, or 0.52% of average total loans on an annualized basis, during the first quarter of 2025.

Compared to the linked quarter and first quarter of 2025, net charge-offs decreased, primarily driven by a decrease in net charge-offs in leases originated by the North Star Leasing division.

The following table details Peoples’ nonperforming assets:

(Dollars in thousands) September 30,

2025 June 30,

2025 March 31,

(Dollars in thousands) March 31,

2026 December 31,

2025 September 30,

2025 June 30,

2025 March 31,

Loans 90+ days past due and accruing:

12 unchanged sentences

Commercial and industrial 4,558 8,045 6,258 5,514 5,747

Premium finance 455 573 — — —

Leases 9,909 11,063 11,338 11,907 12,079

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Classified loans as a percent of total loans (b) 2.10 % 2.18 % 2.36 % 1.89 % 1.93 %

(a) Includes loans categorized as special mention, substandard or doubtful.

(b) Includes loans categorized as substandard or doubtful.

(a) Includes loans categorized as special mention, substandard, doubtful, or loss.

(b) Includes loans categorized as substandard, doubtful, or loss.

1 unchanged sentence

NPAs include nonperforming loans and OREO.

Peoples' NPAs decreased from 0.49% of total assets at June 30, 2025 to 0.47% of total assets at September 30, 2025.

Total loans 90+ days past due and accruing decreased at September 30, 2025 compared to September 30, 2024 driven down by leases and premium finance loans.

During the third quarter of 2025, criticized loans increased $23.9 million, while classified loans increased $33.6 million when compared to at June 30, 2025.

The increase in classified loans compared to at June 30, 2025 and at September 30, 2024 was driven by loan downgrades.

The decrease in NPAs compared to at June 30, 2025, was primarily driven by a decrease in premium finance loans that were 90+ days past due and accruing.

The decrease in NPAs compared to at September 30, 2024, was driven primarily by a reductions in leases that were 90+ days past due and accruing.

Peoples' NPAs decreased from 0.45% of total assets at December 31, 2025 to 0.41% of total assets at March 31, 2026.

Total loans 90+ days past due and accruing decreased at March 31, 2026 compared to December 31, 2025, driven by a decrease in residential real estate loans which were transferred to nonaccrual status.

During the first quarter of 2026, criticized loans decreased $12.3 million, while classified loans decreased $5.2 million when compared to at December 31, 2025.

The decrease in both criticized and classified loans compared to at December 31, 2025 was driven by paydowns and loan upgrades.

The decrease in criticized loans compared to at March 31, 2025 was driven by paydowns and loan upgrades.

The increase in classified loans for the same period was driven by loan downgrades.

The decrease in NPAs compared to at December 31, 2025, was primarily driven by a decrease in nonaccrual commercial and industrial loans and leases, partially offset by an increase in nonaccrual other commercial real estate loans .

The decrease in NPAs compared to at March 31, 2025, was driven primarily by the sale of an OREO property in the fourth quarter of 2025.

The following table details Peoples’ deposit balances:

(Dollars in thousands) September 30,

2025 June 30,

2025 March 31,

(Dollars in thousands) March 31,

2026 December 31,

2025 September 30,

2025 June 30,

2025 March 31,

Non-interest-bearing deposits (a) $ 1,586,514 $ 1,545,428 $ 1,536,094 $ 1,530,824 $ 1,526,285

10 unchanged sentences

(a) The sum of amounts presented is considered total demand deposits.

At September 30, 2025, period-end total deposits decreased $5.0 million compared to at June 30, 2025, driven by decreases of $25.9 million in brokered CDs and $12.2 million in governmental deposits, partially offset by increases of $20.6 million in money market deposits, $9.5 million in interest bearing demand accounts, and $5.3 million in non-interest bearing deposits.

At March 31, 2026, period-end total deposits increased $38.2 million compared to at December 31, 2025, driven by increases of $102.1 million in governmental deposits, which was due to seasonality, $41.1 million in non-interest bearing deposits, $31.2 million in savings accounts, and $19.6 million in interest-bearing demand accounts, partially offset by a decrease of $153.5 million in brokered deposits.

The decrease in brokered deposit accounts was due to a strategic shift to other funding sources at lower rates.

Compared to September 30, 2024, period-end deposit balances increased $149.0 million, or 2%.

The increase in total deposits was primarily driven by increases of $124.5 million in retail CDs, $82.7 million in non-interest bearing deposits, and $53.5 million in money market deposits.

These were partially offset by decreases of $79.1 million in brokered CDs and $54.4 million in governmental deposits.

The increase in retail certificates of deposits was driven by special promotional rate offerings over the past year.

Compared to at March 31, 2025, period-end deposit balances decreased $86.3 million, or 1%.

As part of its funding strategy, Peoples hedges 90-day brokered CDs or FHLB advances with interest rate swaps.

The interest rate swaps pay a fixed rate of interest while receiving a floating rate component of interest tied to term SOFR, which offsets the rate on the brokered CDs or FHLB advances.

As of September 30, 2025, Peoples had five effective interest rate swaps, with an aggregate notional value of $45.0 million, which were designated as cash flow hedges.

As of March 31, 2026, Peoples had five effective interest rate swaps, with an aggregate notional value of $45.0 million, which were designated as cash flow hedges.

Peoples continually evaluates the overall balance sheet position given the interest rate environment.

1 unchanged sentence

The following table details Peoples’ short-term borrowings and long-term borrowings:

(Dollars in thousands) September 30,

2025 June 30,

2025 March 31,

(Dollars in thousands) March 31,

2026 December 31,

2025 September 30,

2025 June 30,

2025 March 31,

Short-term borrowings:

3 unchanged sentences

22,941 20,277 14,250 23,569 19,228

Bank Term Funding Program ("BTFP") — — — — 163,000

Other short-term borrowings 62,921 145,008 275,340 17,291 —

13 unchanged sentences

Total borrowed funds, which include overnight borrowings, are mainly a function of loan growth and changes in total deposit balances.

Other long-term borrowings include trust preferred securities and floating rate junior subordinated deferrable interest debentures.

Total borrowed funds at September 30, 2025 increased compared to at June 30, 2025 due to higher overnight borrowings.

Total borrowed funds increased compared to at September 30, 2024 due to higher overnight borrowings, partially offset by the payoff of the Bank Term Funding Program.

Other long-term borrowings include trust preferred securities and floating rate deferrable interest debentures.

Total borrowed funds at March 31, 2026 decreased compared to at December 31, 2025 due to the increase in period-end deposits.

Total borrowed funds increased compared to at March 31, 2025 due to higher overnight borrowings.

Capital/Stockholders’ Equity

At September 30, 2025, capital levels for both Peoples and Peoples Bank remained substantially higher than the minimum amounts needed to be considered "well capitalized" institutions under applicable banking regulations.

At March 31, 2026, capital levels for both Peoples and Peoples Bank remained substantially higher than the minimum amounts needed to be considered "well capitalized" institutions under applicable banking regulations.

These higher capital levels reflect Peoples' desire to maintain a strong capital position.

In order to avoid limitations on dividends, equity repurchases and compensation, Peoples must exceed the three minimum required ratios by at least the capital conservation buffer of 2.50%, which applies to the common equity tier 1 ("CET1") ratio, the tier 1 capital ratio and the total risk-based capital ratio.

At September 30, 2025, Peoples had a capital conservation buffer of 5.79%.

At March 31, 2026, Peoples had a capital conservation buffer of 5.98%.

The following table details Peoples' risk-based capital levels and corresponding ratios:

(Dollars in thousands) September 30,

2025 June 30,

2025 March 31,

(Dollars in thousands) March 31,

2026 December 31,

2025 September 30,

2025 June 30,

2025 March 31,

Capital Amounts:

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Tier 1 leverage ratio 10.14 % 9.91 % 9.74 % 9.83 % 9.80 %

Peoples' risk-based capital ratios at September 30, 2025 increased when compared to at June 30, 2025 due to the increase in assets, driven by loan growth in the quarter.

Peoples' risk-based capital ratios at March 31, 2026 increased when compared to at December 31, 2025 due to net income during the quarter, partially offset by dividends paid.

In addition to traditional capital measurements, management uses tangible capital measures to evaluate the adequacy of Peoples' stockholders' equity.

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Management believes this information is useful to investors since it facilitates the comparison of Peoples' operating performance, financial condition and trends to peers, especially those without a similar level of intangible assets to that of Peoples.

Further, intangible assets generally are difficult to convert into cash, especially during a financial crisis, and could decrease substantially in

value should there be deterioration in the overall franchise value.

Further, intangible assets generally are difficult to convert into cash, especially during a financial crisis, and could decrease substantially in value should there be deterioration in the overall franchise value.

As a result, tangible equity represents a conservative measure of the capacity for Peoples to incur losses but remain solvent.

The following table reconciles the calculation of these Non-US GAAP financial measures to amounts reported in Peoples' Unaudited Condensed Consolidated Financial Statements:

(Dollars in thousands) September 30,

2025 June 30,

2025 March 31,

(Dollars in thousands) March 31,

2026 December 31,

2025 September 30,

2025 June 30,

2025 March 31,

Tangible equity:

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8.91 % 8.79 % 8.53 % 8.26 % 8.34 %

Tangible book value per common share increased to $22.05 at September 30, 2025 compared to $21.18 at June 30, 2025.

The change in tangible book value per common share was due to tangible equity increasing during the third quarter of 2025 primarily due to a decrease in accumulated other comprehensive loss over the last three months.

Tangible book value per common share at September 30, 2025 increased compared to at September 30, 2024 primarily due to net income over the last twelve months.

Tangible book value per common share increased to $22.95 at March 31, 2026 compared to $22.77 at December 31, 2025.

The change in tangible book value per common share was due to net income over the last three months.

Tangible book value per common share at March 31, 2026 increased compared to at March 31, 2025 primarily due to net income over the last twelve months.

Interest Rate Sensitivity and Liquidity

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Net Interest Income Estimated (Decrease) Increase in Economic Value of Equity

(in Basis Points) September 30, 2025 December 31, 2024 September 30, 2025 December 31, 2024

(in Basis Points) March 31, 2026 December 31, 2025 March 31, 2026 December 31, 2025

300 $ 40,204 10.5 % $ 33,685 9.0 % $ (139,866) (6.4) % $ (180,169) (8.5) %

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Peoples believes these scenarios to be more reflective of how interest rates change versus the severe parallel rate shocks described above.

Given the shape of market yield curves at September 30, 2025, consideration of the bear steepener and bull steepener scenarios provide insights which were not captured by parallel shifts.

Given the shape of market yield curves at March 31, 2026, consideration of the bear steepener and bull steepener scenarios provide insights which were not captured by parallel shifts.

The bear steepener scenario highlights the risk to net interest income and economic value of equity when short-term interest rates remain constant while long-term interest rates rise.

In such a scenario, Peoples' deposit and borrowing costs, which are generally correlated with short-term interest rates, remain constant, while asset yields, which are correlated with long-term interest rates, rise.

At September 30, 2025, the bear steepener scenario produced an increase in net interest income of 0.8% and an increase in the economic value of equity of 5.6%.

At March 31, 2026, the bear steepener scenario produced an increase in net interest income of 1.0% and an increase in the economic value of equity of 3.7%.

The bull steepener scenario highlights the risk to net interest income and the economic value of equity when short-term rates fall faster than long-term rates.

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Deposit costs decrease less quickly than variable rate asset yields over a short-term horizon but are mitigated to some extent over a longer horizon, resulting in a decreased amount of net interest income (margin) in a 12 month period and a relatively neutral impact to net interest income (margin) in a 24 month period.

At September 30, 2025, the bull steepener scenario produced a decline of 0.7% to net interest income, as the impact of revised assumptions around deposit betas mitigate the impact of lower short-term rates over a 12-month horizon, and an increase in the economic value of equity of 1.9%.

At March 31, 2026, the bull steepener scenario produced a decline of 0.6% to net interest income, as the impact of revised assumptions around deposit betas mitigate the impact of lower short-term rates over a 12-month horizon, and an increase in the economic value of equity of 1.0%.

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.

As of September 30, 2025, Peoples had entered into five interest rate swap contracts with an aggregate notional value of $45.0 million.

As of March 31, 2026, Peoples had entered into five interest rate swap contracts with an aggregate notional value of $45.0 million.

Additional information regarding Peoples’ interest rate swaps can be found in “Note 10 Derivative Financial Instruments” of the Notes to the Unaudited Condensed Consolidated Financial Statements.

At September 30, 2025, Peoples' Unaudited Consolidated Balance Sheet was positioned to benefit from rising interest rates, while also mitigating the impact to net interest income decreasing rate scenarios.

At March 31, 2026, Peoples' Unaudited Consolidated Balance Sheet was positioned to benefit from rising interest rates, while also mitigating the impact to net interest income decreasing rate scenarios.

The table above illustrates this point as changes to net interest income increase in the rising interest rate scenarios.

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adequacy of Peoples Bank's liquidity position remain appropriate and are largely unchanged from those disclosed in Peoples' 2025 Form 10-K.

At September 30, 2025, Peoples Bank had liquid assets of $597.9 million, which represented 5.5% of total assets and unfunded loan commitments.

At March 31, 2026, Peoples Bank had liquid assets of $580.2 million, which represented 5.2% of total assets and unfunded loan commitments.

Peoples also had an additional $132.9 million of unpledged investment securities not included in the measurement of liquid assets.

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(Dollars in thousands)

2026 December 31,

2025 September 30,

1 unchanged sentence

2025 March 31,

2025 December 31,

2024 September 30,

Home equity lines of credit $ 278,771 $ 272,977 $ 267,598 $ 268,217 $ 257,349

7 unchanged sentences

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis