What changed in this filing

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Item 1. Financial Statements

2024-08-02 compared with 2024-05-02 · 490 added, 221 removed, 1467 unchanged (33% of the section changed)

8 unchanged sentences

Investment securities:

Debt securities available-for-sale, at fair value (amortized cost of $ 1,334,973 and $ 1,418,770 at March 31, 2024 and December 31, 2023, respectively, and no allowance for credit losses at March 31, 2024 or at December 31, 2023)

Debt securities available-for-sale, at fair value (amortized cost of $ 1,259,498 and $ 1,418,770 at June 30, 2024 and December 31, 2023, respectively, and no allowance for credit losses at June 30, 2024 or at December 31, 2023)

1,170,706 1,332,842

38 unchanged sentences

20,000,000 shares authorized;

17,623,104 common shares issued at March 31, 2024 and at December 31, 2023)

17,623,104 common shares issued at June 30, 2024 and at December 31, 2023)

460,821 463,280

Retained earnings 943,149 903,877

Treasury shares ( 1,473,581 common shares at March 31, 2024 and 1,506,625 common shares at December 31, 2023)

Treasury shares ( 1,473,581 common shares at June 30, 2024 and 1,506,625 common shares at December 31, 2023)

( 152,259 ) ( 155,673 )

7 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2024 2023 2024 2023

Interest and dividend income:

23 unchanged sentences

ATM fees 458 553 954 1,086

Gain (loss) on the sale of OREO, net 121 ( 9 )

Loss on the sale of debt securities, net — — ( 398 ) —

Loss on equity securities, net ( 687 ) ( 405 )

Gain (loss) on equity securities, net 358 25 ( 329 ) ( 380 )

Other components of net periodic pension benefit income 2,204 1,893 4,408 3,786

5 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2024 2023 2024 2023

Other expense:

27 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2024 2023 2024 2023

Net income $ 39,369 $ 31,584 $ 74,573 $ 65,317

Other comprehensive (loss) income, net of tax:

Unrealized net holding (loss) gain on debt securities available-for-sale, net of income tax effect of $( 138 ) and $ 3,285 for the three months ended March 31, 2024 and 2023, respectively

Unrealized net holding (loss) gain on debt securities available-for-sale, net of income tax effect of $( 547 ) and $( 1,795 ) for the three months ended June 30, 2024 and 2023, respectively, and $( 685 ) and $ 1,490 for the six months ended June 30, 2024 and 2023, respectively

( 2,059 ) ( 6,753 ) ( 2,577 ) 5,608

Net loss realized on sale of debt securities, AFS, net of income tax effect of $ 84 for the three months ended March 31, 2024

Net loss realized on sale of debt securities, AFS, net of income tax effect of $ 84 for the six months ended June 30, 2024

Other comprehensive (loss) income $ ( 2,059 ) $ ( 6,753 ) $ ( 2,263 ) $ 5,608

17 unchanged sentences

Balance at March 31, 2024 $ — $ 459,532 $ 921,101 $ ( 152,259 ) $ ( 66,395 )

Net income 39,369

Other comprehensive loss, net of tax ( 2,059 )

Dividends on common shares at $ 1.06 per common share

Share-based compensation expense 1,289

Balance at June 30, 2024 $ — $ 460,821 $ 943,149 $ ( 152,259 ) $ ( 68,454 )

PARK NATIONAL CORPORATION AND SUBSIDIARIES

Consolidated Condensed Statements of Changes in Shareholders' Equity (Unaudited) (Continued)

(in thousands, except common share and per common share data)

Shares Common

14 unchanged sentences

Balance at March 31, 2023 $ — $ 459,431 $ 862,518 $ ( 149,763 ) $ ( 90,033 )

Net income 31,584

Other comprehensive loss, net of tax ( 6,753 )

Dividends on common shares at $ 1.05 per common share

Issuance of 4358 common shares under share-based compensation awards, net of 1992 common shares withheld to pay employee income taxes

( 602 ) ( 85 ) 450

Share-based compensation expense 1,749

Repurchase of 25000 common shares to be held as treasury shares

Balance at June 30, 2023 $ — $ 460,578 $ 876,830 $ ( 151,865 ) $ ( 96,786 )

SEE ACCOMPANYING NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

2 unchanged sentences

(in thousands)

Three Months Ended

Six Months Ended

Operating activities:

5 unchanged sentences

Amortization of investment securities, net 787 1,722

Net (accretion) amortization of purchase accounting adjustments ( 30 ) 119

Net amortization of purchase accounting adjustments 21 263

Loss on the sale of debt securities, net 398 —

4 unchanged sentences

Share-based compensation expense 3,242 4,085

(Gain) loss on sale of OREO, net ( 121 ) 9

Bank owned life insurance income ( 4,194 ) ( 2,517 )

1 unchanged sentence

Changes in assets and liabilities:

Decrease in prepaid dealer premiums 173 601

Decrease (increase) in other assets 1,533 ( 2,116 )

Decrease in other liabilities ( 9,537 ) ( 13,986 )

Decrease (increase) in prepaid dealer premiums 704 ( 244 )

Increase in other assets ( 2,905 ) ( 7,315 )

Increase (decrease) in other liabilities 1,986 ( 12,261 )

Net cash provided by operating activities $ 85,241 $ 57,684

8 unchanged sentences

FHLB stock ( 6,501 ) ( 1,407 )

Net decrease (increase) in other investments 317 ( 183 )

Net loan (originations) paydowns, portfolio loans ( 49,181 ) 50,193

Net (increase) decrease in other investments ( 557 ) 1,114

Net loan originations, portfolio loans ( 185,414 ) ( 62,399 )

Investment in qualified affordable housing tax credits ( 7,300 ) ( 5,576 )

3 unchanged sentences

Purchases of premises and equipment ( 5,004 ) ( 4,047 )

Net cash provided by investing activities $ 32,404 $ 78,653

Net cash used in investing activities $ ( 40,186 ) $ ( 2,036 )

PARK NATIONAL CORPORATION AND SUBSIDIARIES

1 unchanged sentence

(in thousands)

Three Months Ended

Six Months Ended

Financing activities:

Net increase in deposits $ 264,560 $ 28,392

Net (increase) decrease in off-balance sheet deposits ( 1,094 ) 31,337

Net increase (decrease) in deposits $ 268,754 $ ( 70,909 )

Net decrease in off-balance sheet deposits 1,185 195,170

Net decrease in short-term borrowings ( 233,704 ) ( 83,428 )

2 unchanged sentences

Cash dividends paid ( 35,113 ) ( 35,108 )

Net cash provided by (used in) financing activities $ 20,755 $ ( 30,879 )

Net cash used in financing activities $ ( 1,858 ) $ ( 14,979 )

Increase in cash and cash equivalents 43,197 40,669

4 unchanged sentences

Interest $ 60,132 $ 41,243

Federal income tax 10,600 7,350

Non-cash items:

1 unchanged sentence

ROU assets obtained in exchange for lease obligations 2,450 179

New commitments in affordable housing tax credits 10,000 —

New commitments in other investment securities 2,500 2,495

SEE ACCOMPANYING NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

5 unchanged sentences

In the opinion of management, all adjustments (consisting of normal recurring accruals) necessary for a fair presentation of the results of operations for the interim periods included herein have been made.

The results of operations for the three-month period ended March 31, 2024 are not necessarily indicative of the operating results to be anticipated for the year ending December 31, 2024.

The results of operations for the three-month and the six-month periods ended June 30, 2024 are not necessarily indicative of the operating results to be anticipated for the year ending December 31, 2024.

The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with the instructions for Quarterly Reports on Form 10-Q and, therefore, do not include all information and footnotes necessary for a fair presentation of the consolidated condensed balance sheets, consolidated condensed statements of income, consolidated condensed statements of comprehensive income, consolidated condensed statements of changes in shareholders’ equity and consolidated condensed statements of cash flows in conformity with U.S.

8 unchanged sentences

Adoption of New Accounting Pronouncements

No significant new pronouncements were adopted during the three months ended March 31, 2024.

No significant new pronouncements were adopted during the three months or six months ended June 30, 2024.

Issued But Not Yet Effective Accounting Standards

30 unchanged sentences

Note 3 – Investment Securities

Investment securities at March 31, 2024 and at December 31, 2023, were as follows:

Investment securities at June 30, 2024 and at December 31, 2023, were as follows:

Debt securities AFS (In thousands) Amortized

Losses Fair Value

March 31, 2024:

June 30, 2024:

Obligations of states and political subdivisions $ 219,431 $ 110 $ 17,414 $ 202,127

11 unchanged sentences

Total $ 1,418,770 $ 1,227 $ 87,155 $ 1,332,842

Investment securities in an unrealized loss position at March 31, 2024, were as follows:

Investment securities in an unrealized loss position at June 30, 2024, were as follows:

Unrealized loss position for less than 12 months Unrealized loss position for 12 months or longer Total

19 unchanged sentences

Total $ 56,215 $ 1,122 $ 1,150,640 $ 86,033 $ 1,206,855 $ 87,155

At March 31, 2024, Park’s debt securities portfolio consisted of $ 1.2 billion of securities, $ 1.1 billion of which were in an unrealized loss position with aggregate unrealized losses of $ 86.9 million.

Of the $ 1.1 billion of securities in an unrealized loss position, $ 1.0 billion were in an unrealized loss position for 12 months or longer.

At June 30, 2024, Park’s debt securities portfolio consisted of $ 1.2 billion of securities, $ 931.6 million of which were in an unrealized loss position with aggregate unrealized losses of $ 89.6 million.

Of the $ 931.6 million of securities in an unrealized loss position, $ 866.4 million were in an unrealized loss position for 12 months or longer.

Of the $ 89.6 million in unrealized losses, $ 70.0 million were related to Park's "U.S.

2 unchanged sentences

On a quarterly basis, management reviews the credit profile of each non-agency debt security and assesses whether any impairment to the contractually obligated cash flow is likely to occur.

Based on these reviews, management has concluded that the underlying creditworthiness for each security remains sufficient to maintain required payment obligations and, therefore, unrealized losses have not been recognized into net income.

Based on these reviews, management has concluded that the underlying creditworthiness for each security remains sufficient to maintain required payment obligations and that changes in value are largely the result of changes in the yield curve, therefore, unrealized losses have not been recognized into net income.

Management does not intend to sell, and it is not more likely than not that management would be required to sell, the securities prior to their anticipated recovery in respect of the unrealized losses.

Management believes the value will recover as the securities approach maturity or market interest rates change.

There was no allowance for credit losses recorded for debt securities AFS at either March 31, 2024 or December 31, 2023.

Additionally, for the three months ended March 31, 2024 and 2023, there were no credit-related investment impairment losses recognized.

The amortized cost and estimated fair value of investments in debt securities AFS at March 31, 2024, are shown in the following table by contractual maturity, except for asset-backed securities and collateral loan obligations, which are shown as a single total due to the unpredictability of the timing of principal repayments.

There was no allowance for credit losses recorded for debt securities AFS at either June 30, 2024 or December 31, 2023.

Additionally, for the three months and the six months ended June 30, 2024 and 2023, there were no credit-related investment impairment losses recognized.

The amortized cost and estimated fair value of investments in debt securities AFS at June 30, 2024, are shown in the following table by contractual maturity, except for asset-backed securities and collateral loan obligations, which are shown as a single total due to the unpredictability of the timing of principal repayments.

Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties.

14 unchanged sentences

(1) The tax equivalent yield for certain obligations of state and political subdivisions includes the effect of a taxable equivalent adjustment using a 21 % federal corporate income tax rate.

During the three-month period ended March 31, 2024, Park sold certain AFS debt securities with a book value of $ 31.2 million at a gross loss of $ 398,000 .

There were no sales of debt securities AFS during the three-month period ended March 31, 2023.

Investment securities having a fair value of $ 762.1 million and $ 602.0 million at March 31, 2024 and December 31, 2023, respectively, were pledged to collateralize government and public fund deposits, to secure repurchase agreements and as collateral for FHLB advance borrowings.

During the six-month period ended June 30, 2024, Park sold certain AFS debt securities with a book value of $ 31.2 million at a gross loss of $ 398,000 .

There were no sales of debt securities AFS during the three month period ended June 30, 2024.

There were no sales of debt securities AFS during the three month or six-month periods ended June 30, 2023.

Investment securities having a fair value of $ 731.9 million and $ 602.0 million at June 30, 2024 and December 31, 2023, respectively, were pledged to collateralize government and public fund deposits, to secure repurchase agreements and as collateral for FHLB advance borrowings.

Note 4 – Other Investment Securities

4 unchanged sentences

Park's portfolio of equity investments in limited partnerships which provide mezzanine funding ("Partnership Investments") are valued using the NAV practical expedient in accordance with ASC 820.

The carrying amounts of other investment securities at March 31, 2024 and December 31, 2023 were as follows:

(In thousands) March 31, 2024 December 31, 2023

The carrying amounts of other investment securities at June 30, 2024 and December 31, 2023 were as follows:

(In thousands) June 30, 2024 December 31, 2023

FHLB stock $ 10,621 $ 17,754

6 unchanged sentences

(1) There have been no impairments or downward adjustments made to equity investments carried at modified cost.

Cumulatively, upward adjustments of $ 871,000 have been recorded as a result of observable price changes.

There were no adjustments recorded during the three months March 31, 2024 or March 31, 2023 as a result of observable price changes.

During the three months ended March 31, 2024, Park purchased 2,246 shares of FHLB stock with a book value of $ 225,000 .

No shares of FHLB stock were purchased during the three months ended March 31, 2023.

During the three months ended March 31, 2024, the FHLB repurchased 45,630 shares of FHLB stock with a book value of $ 4.6 million.

During the three months ended March 31, 2023, the FHLB repurchased 30,938 shares of FHLB stock with a book value of $ 3.1 million.

No shares of FRB stock were purchased or sold during the three months ended March 31, 2024 or 2023.

During the three months ended March 31, 2024 and 2023, $ 3,000 and $( 27,000 ), respectively, of gains (losses) on equity investments carried at fair value were recorded within "Loss on equity securities, net" on the Consolidated Condensed Statements of Income.

During the three months ended March 31, 2024 and 2023, $( 690,000 ) and $( 378,000 ), respectively, of losses on equity investments carried at NAV were recorded within “Loss on equity securities, net” on the Consolidated Condensed Statements of Income.

Cumulatively, upward adjustments of $1.4 million have been recorded as a result of observable price changes.

There were $ 571,000 in upward adjustments recorded during the three months and six months ended June 30, 2024 as a result of observable price changes.

There were no adjustments recorded during the three months and six months ended June 30, 2023 as a result of observable price changes.

During the three months ended June 30, 2024, Park purchased 62,766 shares of FHLB stock with a book value of $ 6.3 million.

During the six months ended June 30, 2024, Park purchased 65,012 shares of FHLB stock with a book value of $ 6.5 million.

During the three and six months ended June 30, 2023, Park purchased 14,075 shares of FHLB stock with a book value of $ 1.4 million.

During the three months ended June 30, 2024, the FHLB repurchased 90,708 shares of FHLB stock with a book value of $ 9.1 million.

During the six months ended June 30, 2024, the FHLB repurchased 136,338 shares of FHLB stock with a book value of $ 13.6 million.

During the three months ended June 30, 2023, the FHLB repurchased 5,114 shares of FHLB stock with a book value of $ 511,000 .

During the six months ended June 30, 2023, the FHLB repurchased 36,052 shares of FHLB stock with a book value of $ 3.6 million.

No shares of FRB stock were purchased or sold during the three months or six months ended June 30, 2024 or 2023.

During the three months ended June 30, 2024 and 2023, $ 450,000 and $( 112,000 ), respectively, of gains (losses) on equity investments carried at fair value were recorded within "Gain (loss) on equity securities, net" on the Consolidated Condensed Statements of Income.

During the six months ended June 30, 2024 and 2023, $ 453,000 and $( 139,000 ), respectively, of gains (losses) on equity investments carried at fair value were recorded within "Gain (loss) on equity securities, net" on the Consolidated Condensed Statements of Income.

During the three months ended June 30, 2024 and 2023, $( 92,000 ) and $ 137,000 , respectively, of (losses) gains on equity investments carried at NAV were recorded within “Gain (loss) on equity securities, net” on the Consolidated Condensed Statements of Income.

During the six months ended June 30, 2024 and 2023, $( 782,000 ) and $( 241,000 ), respectively, of losses on equity investments carried at NAV were recorded within “Gain (loss) on equity securities, net” on the Consolidated Condensed Statements of Income.

Note 5 – Loans

The composition of the loan portfolio at March 31, 2024 and at December 31, 2023 was as follows:

March 31, 2024 December 31, 2023

The composition of the loan portfolio at June 30, 2024 and at December 31, 2023 was as follows:

June 30, 2024 December 31, 2023

(In thousands) Amortized Cost Amortized Cost

21 unchanged sentences

(1) Included within each of commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

Loans are shown net of deferred origination fees, costs and unearned income of $ 20.3 million at March 31, 2024, and of $ 19.8 million at December 31, 2023, which represented a net deferred income position at both dates.

At March 31, 2024 and December 31, 2023, loans included purchase accounting adjustments of $ 1.5 million and $ 1.8 million, respectively, which represented a net deferred income position at each date.

Loans are shown net of deferred origination fees, costs and unearned income of $ 20.0 million at June 30, 2024, and of $ 19.8 million at December 31, 2023, which represented a net deferred income position at both dates.

At June 30, 2024 and December 31, 2023, loans included purchase accounting adjustments of $ 1.2 million and $ 1.8 million, respectively, which represented a net deferred income position at each date.

This fair market value purchase accounting adjustment is expected to be recognized into interest income on a level yield basis over the remaining expected life of the loans.

Overdrawn deposit accounts of $ 1.6 million and $ 1.5 million were reclassified to loans at March 31, 2024 and at December 31, 2023, respectively.

Overdrawn deposit accounts of $ 4.1 million and $ 1.5 million were reclassified to loans at June 30, 2024 and at December 31, 2023, respectively.

Credit Quality

Nonperforming loans consist of nonaccrual loans and loans past due 90 days or more and still accruing.

The following tables present the amortized cost of nonaccrual loans and loans past due 90 days or more and still accruing, by class of loan, at March 31, 2024 and December 31, 2023.

March 31, 2024

The following tables present the amortized cost of nonaccrual loans and loans past due 90 days or more and still accruing, by class of loan, at June 30, 2024 and December 31, 2023.

June 30, 2024

(In thousands) Nonaccrual

40 unchanged sentences

Total loans $ 60,259 $ 859 $ 61,118

The following tables provide additional detail on nonaccrual loans and the related ACL, by class of loan, at March 31, 2024 and December 31, 2023:

March 31, 2024

The following tables provide additional detail on nonaccrual loans and the related ACL, by class of loan, at June 30, 2024 and December 31, 2023:

June 30, 2024

(In thousands) Nonaccrual Loans With No ACL Nonaccrual Loans With an ACL Related ACL

37 unchanged sentences

Nonaccrual consumer loans are collectively evaluated based on similar risk characteristics.

The following tables provide the amortized cost basis of collateral-dependent loans by class of loan, at March 31, 2024 and at December 31, 2023:

March 31, 2024

The following tables provide the amortized cost basis of collateral-dependent loans by class of loan, at June 30, 2024 and at December 31, 2023:

June 30, 2024

(In thousands) Real Estate Business Assets Other Total

22 unchanged sentences

Interest income on nonaccrual loans individually evaluated for impairment is recognized on a cash basis only when Park expects to receive the entire recorded investment in the loans.

The following table presents interest income recognized on nonaccrual loans for the three-month periods ended March 31, 2024 and 2023:

The following table presents interest income recognized on nonaccrual loans for the three-month and the six-month periods ended June 30, 2024 and 2023:

Interest Income Recognized

(In thousands) Three Months Ended

March 31, 2024 Three Months Ended

March 31, 2023

June 30, 2024 Three Months Ended

June 30, 2023 Six Months Ended

June 30, 2024 Six Months Ended

June 30, 2023

Commercial, financial and agricultural:

5 unchanged sentences

Commercial 1 22 38 54

Retail — — — —

Residential real estate:

1 unchanged sentence

Mortgage 83 53 153 102

HELOC 2 7 7 15

Installment — 1 — 2

1 unchanged sentence

Check loans — — — —

Leases — — — —

Total loans $ 795 $ 1,063 $ 1,505 $ 1,963

The following tables present the aging of the amortized cost in past due loans at March 31, 2024 and at December 31, 2023 by class of loan:

March 31, 2024

The following tables present the aging of the amortized cost in past due loans at June 30, 2024 and at December 31, 2023 by class of loan:

June 30, 2024

(In thousands) Accruing

46 unchanged sentences

Total loans $ 22,686 $ 22,162 $ 44,848 $ 7,431,373 $ 7,476,221

( 1) Includes an aggregate of $ 0.9 million of loans past due 90 days or more and accruing.

( 1) Includes an aggregate of $ 859,000 of loans past due 90 days or more and accruing.

The remaining loans were past due nonaccrual loans.

2 unchanged sentences

Management utilizes past due information as a credit quality indicator across the loan portfolio.

Past due information at March 31, 2024 and December 31, 2023 is included in the previous tables.

Past due information at June 30, 2024 and December 31, 2023 is included in the previous tables.

The past due information is the primary credit quality indicator within the following classes of loans:

19 unchanged sentences

Any commercial loan graded an 8 (loss) is completely charged off.

Based on the most recent analysis performed, the risk category of commercial loans by class of loans at March 31, 2024 and at December 31, 2023 are detailed in the tables below.

Also included in the tables detailing loan balances are gross charge offs for the three months ended March 31, 2024 and for the year ended December 31, 2023.

March 31, 2024 Term Loans Amortized Cost Basis by Origination Year

Based on the most recent analysis performed, the risk category of commercial loans by class of loans at June 30, 2024 and at December 31, 2023 are detailed in the tables below.

Also included in the tables detailing loan balances are gross charge offs for the six months ended June 30, 2024 and for the year ended December 31, 2023.

June 30, 2024 Term Loans Amortized Cost Basis by Origination Year

(In thousands) 2024 2023 2022 2021 2020 Prior Revolving Loans Amortized Cost Basis Total

28 unchanged sentences

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

March 31, 2024 Term Loans Amortized Cost Basis by Origination Year

June 30, 2024 Term Loans Amortized Cost Basis by Origination Year

(In thousands) 2024 2023 2022 2021 2020 Prior Revolving Loans Amortized Cost Basis Total

76 unchanged sentences

For residential and consumer loan classes, Park also evaluates credit quality based on the aging status of the loan, which was previously presented, and by performing status.

The following tables present the amortized cost in residential and consumer loans based on performing status and gross charge offs for the three months ended March 31, 2024 and for the year ended December 31, 2023.

The following tables present the amortized cost in residential and consumer loans based on performing status and gross charge offs for the six months ended June 30, 2024 and for the year ended December 31, 2023.

Nonperforming loans consisted of nonaccrual loans and loans past due 90 days or more and still accruing.

March 31, 2024 Term Loans Amortized Cost Basis by Origination Year

June 30, 2024 Term Loans Amortized Cost Basis by Origination Year

(In thousands) 2024 2023 2022 2021 2020 Prior Revolving Loans Amortized Cost Basis Total

33 unchanged sentences

Current period gross charge-offs $ 11 $ 1,463 $ 2,065 $ 1,299 $ 457 $ 465 $ 2 $ 5,762

March 31, 2024 Term Loans Amortized Cost Basis by Origination Year

June 30, 2024 Term Loans Amortized Cost Basis by Origination Year

(In thousands) 2024 2023 2022 2021 2020 Prior Revolving Loans Amortized Cost Basis Total

62 unchanged sentences

PCD loans are individually evaluated on a quarterly basis to determine if a reserve is necessary.

At March 31, 2024 and at December 31, 2023, there was no allowance for credit losses on PCD loans.

The carrying amount of accruing loans acquired with deteriorated credit quality at March 31, 2024 and at December 31, 2023 was $ 2.5 million and $ 2.8 million, respectively.

The carrying amount of nonaccrual loans acquired with deteriorated credit quality was $ 544,000 and $ 534,000 at March 31, 2024 and at December 31, 2023, respectively.

At June 30, 2024 and at December 31, 2023, there was no allowance for credit losses on PCD loans.

The carrying amount of accruing loans acquired with deteriorated credit quality at June 30, 2024 and at December 31, 2023 was $ 2.4 million and $ 2.8 million, respectively.

The carrying amount of nonaccrual loans acquired with deteriorated credit quality was $ 546,000 and $ 534,000 at June 30, 2024 and at December 31, 2023, respectively.

Modifications to Borrowers Experiencing Financial Difficulty

12 unchanged sentences

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

The following tables present the amortized cost basis of loans at March 31, 2024 and 2023 that were both experiencing financial difficulty and modified during the three months ended March 31, 2024 and 2023 by class and type of modification.

The following tables present the amortized cost basis of loans at June 30, 2024 and 2023 that were both experiencing financial difficulty and modified during the three months and the six months ended June 30, 2024 and 2023 by class and type of modification.

The percentage of the amortized cost basis of loans that were modified to borrowers in financial difficulty as compared to the amortized cost basis of each class of financing receivable is also presented below.

Three Months Ended

March 31, 2024

June 30, 2024

(Dollars in thousands) Principal Forgiveness Payment Delay Term Extension Interest Rate Reduction Combination Term Extension and Interest Rate Reduction Other Total Percent of Total Class of Financing Receivable

17 unchanged sentences

Three Months Ended

March 31, 2023

June 30, 2023

16 unchanged sentences

Total $ — $ — $ 11,576 $ 8 $ 151 $ 12 $ 11,747 0.16 %

At March 31, 2024 Park had commitments to lend $ 1.4 million related to to loans which were both experiencing financial difficulty and modified during the three months ended March 31, 2024.

The following tables present the financial effect of the loan modifications presented above to borrowers experiencing financial difficulty for the three months ended March 31, 2024 and 2023:

Six Months Ended

June 30, 2024

Commercial, financial and agricultural:

Commercial, financial and agricultural $ — $ 54 $ 11,783 $ 9 $ — $ — $ 11,846 0.89 %

PPP loans — — — — — — — — %

Overdrafts — — — — — — — — %

Commercial real estate — 161 4,813 340 121 — 5,435 0.28 %

Construction real estate:

Commercial — — — — — — — — %

Retail — — — — — — — — %

Residential real estate:

Commercial — — 834 — 220 — 1,054 0.17 %

Mortgage — — 93 — — — 93 0.01 %

HELOC — — — — — — — — %

Installment — — 107 — 77 — 184 3.04 %

Consumer — — — 6 — — 6 — %

Check loans — — — — — — — — %

Leases — — — — — — — — %

Total $ — $ 215 $ 17,630 $ 355 $ 418 $ — $ 18,618 0.24 %

Six Months Ended

June 30, 2023

Commercial, financial and agricultural:

Commercial, financial and agricultural $ — $ — $ 11,412 $ — $ — $ 12 $ 11,424 0.89 %

PPP loans — — — — — — — — %

Overdrafts — — — — — — — — %

Commercial real estate — — 836 — — — 836 0.05 %

Construction real estate:

Commercial — — 366 — — — 366 0.23 %

Retail — — — — — — — — %

Residential real estate:

Commercial — — 162 — — — 162 0.03 %

Mortgage — — — — 135 — 135 0.01 %

HELOC — — — — — — — — %

Installment — — 4 — 79 — 83 1.95 %

Consumer — — — 22 — — 22 — %

Check loans — — — — — — — — %

Leases — — — — — — — — %

Total $ — $ — $ 12,780 $ 22 $ 214 $ 12 $ 13,028 0.18 %

At June 30, 2024, Park had commitments to lend $ 1.5 million related to loans which were both experiencing financial difficulty and modified during the six months ended June 30, 2024.

The following tables present the financial effect of the loan modifications presented above to borrowers experiencing financial difficulty for the three months and the six months ended June 30, 2024 and 2023:

Three Months Ended

March 31, 2024

June 30, 2024

(Dollars in thousands) Principal Forgiveness Weighted Average Interest Rate Reduction Weighted Average Term Extension (years) Weighted Average Payment Delay (years)

17 unchanged sentences

Three Months Ended

March 31, 2023

(Dollars in thousands) Principal Forgiveness Weighted Average Interest Rate Reduction Weighted Average Term Extension (years)

June 30, 2023

(Dollars in thousands) Principal Forgiveness Weighted Average Interest Rate Reduction Weighted Average Term Extension (years) Weighted Average Payment Delay (years)

Commercial, financial and agricultural:

15 unchanged sentences

Total $ — ( 2.04 ) % 0.8 0.0

Six Months Ended

June 30, 2024

(Dollars in thousands) Principal Forgiveness Weighted Average Interest Rate Reduction Weighted Average Term Extension (years) Weighted Average Payment Delay (years)

Commercial, financial and agricultural:

Commercial, financial and agricultural $ — ( 0.50 ) % 0.3 0.4

PPP loans — — % 0.0 0.0

Overdrafts — — % 0.0 0.0

Commercial real estate — ( 1.90 ) % 2.9 0.4

Construction real estate:

Commercial — — % 0.0 0.0

Retail — — % 0.0 0.0

Residential real estate:

Commercial — ( 1.00 ) % 2.2 0.0

Mortgage — — % 4.2 0.0

HELOC — — % 0.0 0.0

Installment — ( 1.22 ) % 9.6 0.0

Consumer — ( 7.54 ) % 0.0 0.0

Check loans — — % 0.0 0.0

Leases — — % 0.0 0.0

Total $ — ( 1.61 ) % 1.2 0.4

Six Months Ended

June 30, 2023

(Dollars in thousands) Principal Forgiveness Weighted Average Interest Rate Reduction Weighted Average Term Extension (years) Weighted Average Payment Delay (years)

Commercial, financial and agricultural:

Commercial, financial and agricultural $ — — % 0.6 0.0

PPP loans — — % 0.0 0.0

Overdrafts — — % 0.0 0.0

Commercial real estate — — % 3.6 0.0

Construction real estate:

Commercial — — % 1.0 0.0

Retail — — % 0.0 0.0

Residential real estate:

Commercial — — % 0.4 0.0

Mortgage — ( 1.88 ) % 0.4 0.0

HELOC — — % 0.0 0.0

Installment — ( 1.72 ) % 10.0 0.0

Consumer — ( 2.92 ) % 0.0 0.0

Check loans — — % 0.0 0.0

Leases — — % 0.0 0.0

Total $ — ( 1.92 ) % 0.9 0.0

Park closely monitors the performance of loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of Park's modification efforts.

There were $ 3.5 million in loans modified to borrowers experiencing financial difficulty that had been modified during the twelve months ended March 31, 2024 that were 60-89 days past due as of March 31, 2024 in the Commercial, financial, and agricultural loan portfolio segment.

There were $ 9,000 in loans modified to borrowers experiencing financial difficulty that had been modified during the previous twelve months that were 30-59 days past due as of March 31, 2024 in the Commercial, financial, and agricultural loan portfolio segment.

All other loans modified to borrowers experiencing financial difficulty during the twelve months ended March 31, 2024 were less than 30 days past due as of March 31, 2024.

There were no loans modified to borrowers experiencing financial difficulty that had been modified during the three months ended March 31, 2023 that were greater than 30 days past due as of March 31, 2023.

The following table presents the amortized cost basis of loans that had a payment default subsequent to modification during the three months ended March 31, 2024 and were modified in the twelve months prior to that default to borrowers experiencing financial difficulty.

There were $ 5.8 million in loans modified to borrowers experiencing financial difficulty that had been modified during the twelve months ended June 30, 2024 that were greater than 90 days past due as of June 30, 2024 in the Commercial, financial, and agricultural loan portfolio segment.

There were $ 19,000 in loans modified to borrowers experiencing financial difficulty that had been modified during the previous twelve months that were 60-89 days past due as of June 30, 2024 in the Residential Real Estate:

Installment loan portfolio segment.

All other loans modified to borrowers experiencing financial difficulty during the twelve months ended June 30, 2024 were less than 30 days past due as of June 30, 2024.

There were $ 150,000 in loans modified to borrowers experiencing financial difficulty that had been modified during the six months ended June 30, 2023 that were greater than 30-59 days past due as of June 30, 2023 in the Residential Real Estate:

Commercial segment.

The following tables present the amortized cost basis of loans that had a payment default subsequent to modification during the three and six months ended June 30, 2024 and were modified in the twelve months prior to that default to borrowers experiencing financial difficulty.

For this table, a loan is considered to be in default when it becomes 30 days contractually past due under the modified terms:

Three Months Ended

March 31, 2024

June 30, 2024

Term Extension Interest Rate Reduction Combination Term Extension and Interest Rate Reduction Other

16 unchanged sentences

Total loans $ 5,888 $ — $ — $ —

There were no loans that had a payment default during the three months ended March 31, 2023 and were modified to borrowers experiencing financial difficulty in the three months prior to that default.

Six Months Ended

June 30, 2024

Term Extension Interest Rate Reduction Combination Term Extension and Interest Rate Reduction Other

Commercial, financial and agricultural:

Commercial, financial and agricultural $ 8,872 $ — $ — $ —

PPP loans — — — —

Overdrafts — — — —

Commercial real estate — — — —

Construction real estate:

Commercial — — — —

Retail — — — —

Residential real estate:

Commercial — — — —

Mortgage 48 — — —

HELOC — — — —

Installment 19 — — —

Consumer — — — —

Check loans — — — —

Leases — — — —

Total loans $ 8,939 $ — $ — $ —

The following table presents the amortized cost basis of loans that had a payment default during the three months ended June 30, 2023 and were modified in the six months prior to that default to borrowers experiencing financial difficulty.

For this table, a loan is considered to be in default when it becomes 30 days contractually past due under the modified terms:

Three Months Ended

June 30, 2023

Term Extension Interest Rate Reduction Combination Term Extension and Interest Rate Reduction Other

Commercial, financial and agricultural:

Commercial, financial and agricultural $ — $ — $ — $ —

PPP loans — — — —

Overdrafts — — — —

Commercial real estate — — — —

Construction real estate:

Commercial — — — —

Retail — — — —

Residential real estate:

Commercial 150 — — —

Mortgage — — 135 —

HELOC — — — —

Installment — — — —

Consumer — 8 — —

Check loans — — — —

Leases — — — —

Total loans $ 150 $ 8 $ 135 $ —

The following table presents the amortized cost basis of loans that had a payment default during the six months ended June 30, 2023 and were modified in the six months prior to that default to borrowers experiencing financial difficulty.

For this table, a

loan is considered to be in default when it becomes 30 days contractually past due under the modified terms:

Six Months Ended

June 30, 2023

Term Extension Interest Rate Reduction Combination Term Extension and Interest Rate Reduction Other

Commercial, financial and agricultural:

Commercial, financial and agricultural $ — $ — $ — $ —

PPP loans — — — —

Overdrafts — — — —

Commercial real estate — — — —

Construction real estate:

Commercial — — — —

Retail — — — —

Residential real estate:

Commercial 150 — — —

Mortgage — — 135 —

HELOC — — — —

Installment — — — —

Consumer — 8 — —

Check loans — — — —

Leases — — — —

Total loans $ 150 $ 8 $ 135 $ —

Upon the determination that a modified loan (or a portion of a loan) has subsequently been deemed uncollectible, the loan (or a portion of the loan) is charged-off.

5 unchanged sentences

This standard was adopted using a modified retrospective transition method on January 1, 2023, resulting in a $ 383,000 increase to the ACL.

A cumulative effect adjustment resulting in a $ 303,000 decrease to retained earnings and an $ 80,000 increase to deferred tax assets was also recorded as a result of the adoption of ASU 2022-02 was also recorded as a result of the adoption of ASU 2022-02.

A cumulative effect adjustment resulting in a $ 303,000 decrease to retained earnings and an $ 80,000 increase to deferred tax assets was also recorded as a result of the adoption of ASU 2022-02.

Quantitative Considerations

29 unchanged sentences

Considering these factors, management determined it was appropriate to maintain the existing weighting, and weigh the "most likely" scenario 50% and the "moderate recession" scenario 50% at March 31, 2024.

◦ As of June 30, 2024, the "most likely" scenario forecasted Ohio unemployment between 4.33% and 4.56% during the next four quarters.

In determining the appropriate weighting of scenarios at June 30, 2024, management considered the range of forecasted unemployment as well as a number of economic indicators.

The continued elevated levels of inflation, volatile levels of consumer confidence, continued elevated interest rates, financial system stress and geopolitical conflict (including the conflicts between Russia and Ukraine and between Israel and Hamas) and stress in the commercial real estate sector, continued to cause uncertainty as to the overall economic environment.

Qualitative Considerations

18 unchanged sentences

• The extent that there is government assistance (stimulus).

Qualitative adjustments amounted to $ 428,000 and $ 417,000 at March 31, 2024 and December 31, 2023, respectively.

The activity in the ACL for the three-month periods ended March 31, 2024 and March 31, 2023 is summarized in the following tables:

Qualitative adjustments amounted to $ 432,000 and $ 417,000 at June 30, 2024 and December 31, 2023, respectively.

The activity in the ACL for the three-month and the six-month periods ended June 30, 2024 and June 30, 2023 is summarized in the following tables:

Three Months Ended

March 31, 2024

June 30, 2024

(In thousands) Commercial,

8 unchanged sentences

Net charge-offs/(recoveries) $ 196 $ ( 5 ) $ ( 119 ) $ ( 155 ) $ 1,705 $ — $ 1,622

(Recovery of) provision for credit losses ( 476 ) 785 ( 399 ) 734 1,490 46 2,180

Provision for (recovery of) credit losses 1,888 ( 331 ) 6 ( 338 ) 1,890 ( 2 ) 3,113

Ending balance $ 16,663 $ 16,855 $ 5,867 $ 19,450 $ 27,579 $ 161 $ 86,575

Three Months Ended

March 31, 2023

June 30, 2023

(In thousands) Commercial,

5 unchanged sentences

Beginning balance $ 16,572 $ 17,946 $ 5,362 $ 17,889 $ 28,053 $ 124 $ 85,946

Charge-offs 188 530 — 14 1,953 — 2,685

Recoveries 84 — 12 114 1,243 — 1,453

Net charge-offs/(recoveries) $ 104 $ 530 $ ( 12 ) $ ( 100 ) $ 710 $ — $ 1,232

(Recovery of) provision for credit losses ( 190 ) 1,725 ( 488 ) 430 1,027 ( 12 ) 2,492

Ending balance $ 16,278 $ 19,141 $ 4,886 $ 18,419 $ 28,370 $ 112 $ 87,206

Six Months Ended

June 30, 2024

(In thousands) Commercial,

financial and

agricultural Commercial

real estate Construction

real estate Residential

real estate Consumer Leases Total

Beginning balance $ 15,496 $ 16,374 $ 5,227 $ 18,818 $ 27,713 $ 117 $ 83,745

Charge-offs 506 — — 31 5,800 — $ 6,337

Recoveries 261 27 1,033 267 2,286 — 3,874

Net charge-offs/(recoveries) $ 245 $ ( 27 ) $ ( 1,033 ) $ ( 236 ) $ 3,514 $ — $ 2,463

Provision for (recovery of) credit losses 1,412 454 ( 393 ) 396 3,380 44 5,293

Ending balance $ 16,663 $ 16,855 $ 5,867 $ 19,450 $ 27,579 $ 161 $ 86,575

Six Months Ended

June 30, 2023

(In thousands) Commercial,

financial and

agricultural Commercial

real estate Construction

real estate Residential

real estate Consumer Leases Total

Beginning balance $ 16,987 $ 17,829 $ 5,550 $ 16,831 $ 28,021 $ 161 $ 85,379

Impact of Adoption of ASU 2022-02 222 181 — ( 20 ) — — $ 383

4 unchanged sentences

Ending balance $ 16,278 $ 19,141 $ 4,886 $ 18,419 $ 28,370 $ 112 $ 87,206

Loans collectively evaluated for impairment in the following tables include all performing loans at March 31, 2024 and at December 31, 2023, as well as nonperforming loans internally classified as consumer loans.

Loans collectively evaluated for impairment in the following tables include all performing loans at June 30, 2024 and at December 31, 2023, as well as nonperforming loans internally classified as consumer loans.

Nonperforming consumer loans are not typically individually evaluated for impairment, but receive a portion of the statistical allocation of the ACL.

1 unchanged sentence

GAAP (see Note 1 - Summary of Significant Accounting Policies of the Notes to Consolidated Financial Statements included in Park’s 2023 Form 10-K).

The composition of the ACL at March 31, 2024 and at December 31, 2023 was as follows:

March 31, 2024

The composition of the ACL at June 30, 2024 and at December 31, 2023 was as follows:

June 30, 2024

(In thousands) Commercial,

43 unchanged sentences

Mortgage loans held for sale are carried at their fair value.

At March 31, 2024 and at December 31, 2023, respectively, Park had $ 2.0 million and $ 3.2 million in mortgage loans held for sale.

At June 30, 2024 and at December 31, 2023, respectively, Park had $ 4.3 million and $ 3.2 million in mortgage loans held for sale.

These amounts are included in loans on the Consolidated Condensed Balance Sheets and in the residential real estate loan portfolio segment in Note 5 - Loans, and Note 6 - Allowance for Credit Losses.

The contractual balance was $ 2.0 million and $ 3.2 million at March 31, 2024 and at December 31, 2023, respectively.

The gain expected upon sale was $ 33,000 and $ 53,000 at March 31, 2024 and at December 31, 2023, respectively.

None of these loans were 90 days or more past due or on nonaccrual status at March 31, 2024 or at December 31, 2023.

The contractual balance was $ 4.2 million and $ 3.2 million at June 30, 2024 and at December 31, 2023, respectively.

The gain expected upon sale was $ 74,000 and $ 53,000 at June 30, 2024 and at December 31, 2023, respectively.

None of these loans were 90 days or more past due or on nonaccrual status at June 30, 2024 or at December 31, 2023.

Note 8 – Goodwill and Other Intangible Assets

The following table shows the activity in goodwill and other intangible assets for the three-month periods ended March 31, 2024 and 2023.

The following table shows the activity in goodwill and other intangible assets for the three-month and six-month periods ended June 30, 2024 and 2023.

(in thousands) Goodwill Other

intangible assets Total

April 1, 2023 $ 159,595 $ 5,648 $ 165,243

Amortization — 328 328

June 30, 2023 $ 159,595 $ 5,320 $ 164,915

April 1, 2024 $ 159,595 $ 4,332 $ 163,927

Amortization — 320 320

June 30, 2024 $ 159,595 $ 4,012 $ 163,607

(in thousands) Goodwill Other

intangible assets Total

December 31, 2022 $ 159,595 $ 5,975 $ 165,570

Amortization — 655 655

March 31, 2023 $ 159,595 $ 5,648 $ 165,243

June 30, 2023 $ 159,595 $ 5,320 $ 164,915

December 31, 2023 $ 159,595 $ 4,652 $ 164,247

Amortization — 640 640

March 31, 2024 $ 159,595 $ 4,332 $ 163,927

June 30, 2024 $ 159,595 $ 4,012 $ 163,607

Park evaluates goodwill for impairment during the second quarter of each year, with financial data as of the immediately prior March 31.

1 unchanged sentence

Acquired Intangible Assets

The following table shows the balance of acquired intangible assets at March 31, 2024 and at December 31, 2023:

March 31, 2024

The following table shows the balance of acquired intangible assets at June 30, 2024 and at December 31, 2023:

June 30, 2024

December 31, 2023

3 unchanged sentences

Core deposit intangible assets are being amortized, on an accelerated basis, over a period of ten years.

Aggregate amortization expense was $ 320,000 and $ 327,000 for the three months ended March 31, 2024 and 2023, respectively.

Aggregate amortization expense was $ 320,000 and $ 328,000 for the three months ended June 30, 2024 and 2023, respectively and was $ 640,000 and $ 655,000 for the six months ended June 30, 2024 and 2023, respectively.

Estimated amortization expense related to core deposit intangible assets for the remainder of 2024 and the next four years follows:

(in thousands) Total

Nine months ending December 31, 2024 $ 894

Six months ending December 31, 2024 $ 574

Note 9 – Investment in Qualified Affordable Housing

1 unchanged sentence

The purposes of these investments are to achieve a satisfactory return on capital, help create affordable housing opportunities, and assist the Company to achieve its goals associated with the Community Reinvestment Act.

The table below details the balances of Park’s affordable housing tax credit investments and related unfunded commitments at March 31, 2024 and December 31, 2023.

(in thousands) March 31, 2024

The table below details the balances of Park’s affordable housing tax credit investments and related unfunded commitments at June 30, 2024 and December 31, 2023.

(in thousands) June 30, 2024

December 31, 2023

3 unchanged sentences

Park expects that the current commitments will be funded between the remainder of 2024 through 2035.

Park recognized amortization expense of $ 2.1 million for both the three months ended March 31, 2024 and 2023, which were included within the provision for income taxes.

Additionally, during the three months ended March 31, 2024 and 2023, Park recognized tax credits and other benefits from its affordable housing tax credit investments of $ 2.6 million and $ 2.4 million, respectively, which were included within the provision for income taxes.

Park recognized amortization expense of $ 2.1 million for both the three months ended June 30, 2024 and 2023, and $ 4.3 million and $ 4.2 million, respectively for the six months ended June 30, 2024 and 2023, which were included within the provision for income taxes.

Additionally, during each of the three months ended June 30, 2024 and 2023, Park recognized tax credits and other benefits from its affordable housing tax credit investments of $ 2.6 million and during the six months ended June 30, 2024 and 2023, recognized $ 5.2 million and $ 5.0 million respectively, which were included within the provision for income taxes.

Note 10 – Foreclosed and Repossessed Assets

Park typically transfers a loan to OREO at the time that Park takes deed/title to the real estate property asset.

The carrying amounts of foreclosed real estate properties held at March 31, 2024 and December 31, 2023 are listed below, as well as the

recorded investment of loans secured by residential real estate properties for which formal foreclosure proceedings were in process at those dates.

(in thousands) March 31, 2024 December 31, 2023

The carrying amounts of foreclosed real estate properties held at June 30, 2024 and December 31, 2023 are listed below, as well as the recorded investment of loans secured by residential real estate properties for which formal foreclosure proceedings were in process at those dates.

(in thousands) June 30, 2024 December 31, 2023

Commercial real estate $ 938 $ 983

Residential real estate 272 —

Construction real estate 14 —

Total OREO $ 1,210 $ 983

2 unchanged sentences

In addition to real estate, Park may also repossess different types of collateral.

At March 31, 2024 and December 31, 2023, Park had $ 1.2 million and $ 1.1 million, respectively, in other repossessed assets which are included in "Other assets" on the consolidated condensed balance sheets.

At June 30, 2024 and December 31, 2023, Park had $ 1.0 million and $ 1.1 million, respectively, in other repossessed assets which are included in "Other assets" on the consolidated condensed balance sheets.

Note 11 – Loan Servicing

Park serviced sold mortgage loans of $ 1.91 billion at March 31, 2024, $ 1.93 billion at December 31, 2023 and $ 2.02 billion at March 31, 2023.

At March 31, 2024, $ 2.9 million of the sold mortgage loans were sold with recourse, compared to $ 2.9 million at December 31, 2023 and $ 3.2 million at March 31, 2023.

Park serviced sold mortgage loans of $ 1.89 billion at June 30, 2024, $ 1.93 billion at December 31, 2023 and $ 1.99 billion at June 30, 2023.

At June 30, 2024, $ 2.7 million of the sold mortgage loans were sold with recourse, compared to $ 2.9 million at December 31, 2023 and $ 3.1 million at June 30, 2023.

Management closely monitors the delinquency rates on the mortgage loans sold with recourse.

At March 31, 2024 and December 31, 2023, management had established reserves of $ 50,000 and $ 54,000 , respectively, to account for expected losses on loan repurchases.

At June 30, 2024 and December 31, 2023, management had established reserves of $ 50,000 and $ 54,000 , respectively, to account for expected losses on loan repurchases.

When Park sells mortgage loans with servicing rights retained, these servicing rights are initially recorded at fair value.

6 unchanged sentences

Three Months Ended

June 30, Six Months Ended

(In thousands) 2024 2023 2024 2023

9 unchanged sentences

End of period $ 28 $ 101 $ 28 $ 101

Servicing fees included in "Other service income" were $ 1.3 million for both the three months ended March 31, 2024 and 2023.

Servicing fees included in "Other service income" were $ 1.2 million and $ 1.3 million for the three months ended June 30, 2024 and 2023, respectively, and were $ 2.5 million and $ 2.6 million for the six months ended June 30, 2024 and 2023, respectively.

Note 12 - Leases

7 unchanged sentences

Park's operating lease ROU asset and lease liability are presented in “Operating lease ROU asset" and "Operating lease liability," respectively, on Park's Consolidated Condensed Balance Sheets.

The carrying amounts of Park's ROU asset and lease liability at March 31, 2024 were $ 15.8 million and $ 16.5 million, respectively.

The carrying amounts of Park's ROU asset and lease liability at June 30, 2024 were $ 17.2 million and $ 17.9 million, respectively.

At December 31, 2023, the carrying amounts of Park's ROU asset and lease liability were $ 15.7 million and $ 16.6 million, respectively.

Park's operating lease expense is recorded in "Occupancy expense" on the Company's Consolidated Condensed Statements of Income.

Other information related to operating leases for the three-month periods ended March 31, 2024 and 2023 follows:

Three Months Ended

(in thousands) March 31, 2024 March 31, 2023

Other information related to operating leases for the three-month and the six-month periods ended June 30, 2024 and 2023 follows:

Three Months Ended Six Months Ended

(in thousands) June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Operating lease cost $ 618 $ 728 $ 1,240 $ 1,460

6 unchanged sentences

Reductions to ROU assets resulting from reductions to lease obligations $ ( 437 ) $ ( 777 ) $ ( 1,095 ) $ ( 1,554 )

Park's operating leases had a weighted average remaining term of 10.0 years and 10.1 years at March 31, 2024 and at December 31, 2023, respectively.

The weighted average discount rate of Park's operating leases was 3.6 % and 3.5 % at March 31, 2024 and at December 31, 2023, respectively.

Park's operating leases had a weighted average remaining term of 10.2 years and 10.1 years at June 30, 2024 and at December 31, 2023, respectively.

The weighted average discount rate of Park's operating leases was 3.8 % and 3.5 % at June 30, 2024 and at December 31, 2023, respectively.

Undiscounted cash flows included in lease liabilities have expected contractual payments as follows:

(in thousands) March 31, 2024

Nine months ending December 31, 2024 $ 1,759

(in thousands) June 30, 2024

Six months ending December 31, 2024 $ 637

Thereafter 12,158

2 unchanged sentences

Total lease liabilities $ 17,898

In March 2024, the Company entered into a noncancellable operating lease for an additional retail office for an initial term

of 88 months, with three five-year renewal options.

This lease is expected to commence no later than the fourth quarter of 2024, and, therefore, was not recognized as of March 31, 2024.

The fixed payments due on an undiscounted basis over the noncancellable 88-month period of the lease are $1.6 million .

The Company will assess the lease renewal options as of the lease commencement date.

Note 13 – Repurchase Agreement Borrowings

3 unchanged sentences

Park's repurchase agreements consist of customer accounts and securities which are pledged on an individual security basis.

At March 31, 2024 and at December 31, 2023, Park's repurchase agreement borrowings totaled $ 105.9 million and $ 108.2 million, respectively.

At June 30, 2024 and at December 31, 2023, Park's repurchase agreement borrowings totaled $ 94.5 million and $ 108.2 million, respectively.

These borrowings were collateralized with U.S.

Government sponsored entities' asset-backed securities with a fair value of $ 143.5 million and $ 180.8 million at March 31, 2024 and at December 31, 2023, respectively.

Government sponsored entities' asset-backed securities with a fair value of $ 124.6 million and $ 180.8 million at June 30, 2024 and at December 31, 2023, respectively.

Declines in the value of the collateral would require Park to pledge additional securities.

At March 31, 2024 and at December 31, 2023, Park had $ 647.8 million and $ 847.5 million, respectively, of available unpledged securities.

The table below shows the remaining contractual maturity of repurchase agreements by collateral pledged at March 31, 2024 and at December 31, 2023:

March 31, 2024

At June 30, 2024 and at December 31, 2023, Park had $ 534.9 million and $ 847.5 million, respectively, of available unpledged securities.

The table below shows the remaining contractual maturity of repurchase agreements by collateral pledged at June 30, 2024 and at December 31, 2023:

June 30, 2024

(in thousands) Remaining Contractual Maturity of the Agreements

15 unchanged sentences

Simultaneously with borrowers entering into interest rate swaps, Carolina Alliance entered into offsetting interest rate swaps executed with a third party, such that Carolina Alliance minimized its net interest rate risk exposure resulting from such transactions.

These interest rate swaps had a notional amount totaling $ 17.0 million and $ 18.2 million at March 31, 2024 and at December 31, 2023, respectively.

All of the Company's interest rate swaps were determined to be fully effective during each of the three-month period s ended March 31, 2024 and March 31, 2023.

These interest rate swaps had a notional amount totaling $ 16.6 million and $ 18.2 million at June 30, 2024 and at December 31, 2023, respectively.

All of the Company's interest rate swaps were determined to be fully effective during each of the three-month and the six-month period s ended June 30, 2024 and June 30, 2023.

As such, no amount of ineffectiveness has been included in net income.

Therefore, the aggregate fair value of the interest rate swaps is recorded in "Other assets" and "Other liabilities" with changes in fair value recorded in "Other comprehensive (loss) income".

The amount included in "Accumulated other comprehensive loss, net of tax"

would be reclassified to net income should the hedges no longer be considered effective.

The amount included in "Accumulated other comprehensive loss, net of tax" would be reclassified to net income should the hedges no longer be considered effective.

Park expects the outstanding hedges to remain fully effective during the remaining respective terms of the interest rate swaps.

Summary information about Park's interest rate swaps at March 31, 2024 and at December 31, 2023 follows:

March 31, 2024 December 31, 2023

Summary information about Park's interest rate swaps at June 30, 2024 and at December 31, 2023 follows:

June 30, 2024 December 31, 2023

(In thousands, except weighted average data) Loan

5 unchanged sentences

Unrealized losses $ — $ —

The following table reflects the interest rate swaps included in the consolidated condensed balance sheets at March 31, 2024 and at December 31, 2023.

(In thousands) March 31, 2024 December 31, 2023

The following table reflects the interest rate swaps included in the consolidated condensed balance sheets at June 30, 2024 and at December 31, 2023.

(In thousands) June 30, 2024 December 31, 2023

Notional Amount Fair Value Notional Amount Fair Value

16 unchanged sentences

Changes in the fair values of these derivatives are included in "Other service income" in the condensed consolidated statements of income.

At March 31, 2024 and at December 31, 2023 , Park had $ 7.3 million and $ 4.0 million, respectively, of interest rate lock commitments.

The fair value of these mortgage banking derivatives was reflected by a derivative asset of $ 158,000 and $ 87,000 at March 31, 2024 and at December 31, 2023 , respectively.

At June 30, 2024 and at December 31, 2023 , Park had $ 4.9 million and $ 4.0 million, respectively, of interest rate lock commitments.

The fair value of these mortgage banking derivatives was reflected by a derivative asset of $ 102,000 and $ 87,000 at June 30, 2024 and at December 31, 2023 , respectively.

Other Derivatives

1 unchanged sentence

The swap agreement adjusts for dilution in the conversion ratio of Class B Visa shares resulting from certain Visa litigation.

At both March 31, 2024 and December 31, 2023 , the fair value of the swap agreement liability of $ 123,000 represented an estimate of the exposure based upon probability-weighted potential Visa litigation losses.

At both June 30, 2024 and December 31, 2023 , the fair value of the swap agreement liability of $ 123,000 represented an estimate of the exposure based upon probability-weighted potential Visa litigation losses.

Note 15 – Accumulated Other Comprehensiv e Loss

Other comprehensive income (loss) components, net of tax, are shown in the following table for the three-month periods ended March 31, 2024 and 2023:

Other comprehensive income (loss) components, net of tax, are shown in the following table for the three-month and the six-month periods ended June 30, 2024 and 2023:

(in thousands) Changes in pension plan assets and benefit obligations Unrealized losses on debt securities AFS Total

Beginning balance at April 1, 2024 $ 1,692 $ ( 68,087 ) $ ( 66,395 )

Other comprehensive loss before reclassifications — ( 2,059 ) ( 2,059 )

Net current period other comprehensive loss — ( 2,059 ) ( 2,059 )

Ending balance at June 30, 2024 $ 1,692 $ ( 70,146 ) $ ( 68,454 )

Beginning balance at April 1, 2023 $ ( 6,680 ) $ ( 83,353 ) $ ( 90,033 )

Other comprehensive loss before reclassifications — ( 6,753 ) ( 6,753 )

Net current period other comprehensive loss — ( 6,753 ) ( 6,753 )

Ending balance at June 30, 2023 $ ( 6,680 ) $ ( 90,106 ) $ ( 96,786 )

(in thousands) Changes in pension plan assets and benefit obligations Unrealized (losses) gains on debt securities AFS Total

Beginning balance at January 1, 2024 $ 1,692 $ ( 67,883 ) $ ( 66,191 )

2 unchanged sentences

Net current period other comprehensive loss — ( 2,263 ) ( 2,263 )

Ending balance at March 31, 2024 $ 1,692 $ ( 68,087 ) $ ( 66,395 )

Ending balance at June 30, 2024 $ 1,692 $ ( 70,146 ) $ ( 68,454 )

Beginning balance at January 1, 2023 $ ( 6,680 ) $ ( 95,714 ) $ ( 102,394 )

1 unchanged sentence

Net current period other comprehensive income — 5,608 5,608

Ending balance at March 31, 2023 $ ( 6,680 ) $ ( 83,353 ) $ ( 90,033 )

During the three -months ended March 31, 2024, there was $ 398,000 ($ 314,000 net of tax) reclassified out of accumulated other comprehensive loss due to a net loss on the sale of debt securities.

Ending balance at June 30, 2023 $ ( 6,680 ) $ ( 90,106 ) $ ( 96,786 )

During the six -month period ended June 30, 2024, there was $ 398,000 ($ 314,000 net of tax) reclassified out of accumulated other comprehensive loss due to a net loss on the sale of debt securities.

This loss was recorded within "Loss on the sale of debt securities, net" on the consolidated condensed statements of income.

During the three -month period ended March 31, 2023, there were no reclassifications out of accumulated other comprehensive loss.

During the three-month period ended June 30, 2024, there were no reclassifications out of accumulated other comprehensive loss.

During the three -month and six -month periods ended June 30, 2023, there were no reclassifications out of accumulated other comprehensive loss.

Note 16 – Earnings Per Common Share

The following table sets forth the computation of basic and diluted earnings per common share for the three months ended March 31, 2024 and 2023.

The following table sets forth the computation of basic and diluted earnings per common share for the three months and six months ended June 30, 2024 and 2023.

Three Months Ended

June 30, Six Months Ended

(In thousands, except common share and per common share data) 2024 2023 2024 2023

6 unchanged sentences

Diluted earnings per common share $ 2.42 $ 1.94 $ 4.60 $ 4.01

Park awarded 59,165 PBRSUs and 54,698 PBRSUs to certain employees during the three months ended March 31, 2024 and 2023, respectively.

Park repurchased an aggregate 124,000 common shares during the three months ended March 31, 2023, to fund the PBRSUs, the TBRSUs and the common shares to be awarded to directors of Park and to directors of Park's subsidiary PNB (and its divisions) as well as pursuant to Park's previously announced stock repurchase authorizations.

No common shares were repurchased during the three months ended March 31, 2024.

Park awarded 59,165 PBRSUs and 54,698 PBRSUs to certain employees during the six months ended June 30, 2024 and 2023, respectively.

No PBRSUs were awarded during either of the three months ended June 30, 2024 and 2023

Park repurchased an aggregate of 25,000 and 149,000 common shares during the three months and six months ended June 30, 2023, respectively, to fund the PBRSUs, the TBRSUs and the common shares to be awarded to directors of Park and to directors of Park's subsidiary PNB (and its divisions) as well as pursuant to Park's previously announced stock repurchase authorizations.

No common shares were repurchased during the three months or the six months ended June 30, 2024.

Note 17 - Share-Based Compensation

3 unchanged sentences

The common shares to be delivered under the 2017 Employees LTIP are to consist of either common shares currently held or common shares subsequently acquired by Park as treasury shares, including common shares purchased in the open market or in private transactions.

At March 31, 2024, 240,835 common shares were available for future grants under the 2017 Employees LTIP.

At June 30, 2024, 240,835 common shares were available for future grants under the 2017 Employees LTIP.

The Park National Corporation 2017 Long-Term Incentive Plan for Non-Employee Directors (the "2017 Non-Employee Directors LTIP") was adopted by the Board of Directors of Park on January 23, 2017 and was approved by Park's shareholders at the Annual Meeting of Shareholders on April 24, 2017.

2 unchanged sentences

The common shares to be delivered under the 2017 Non-Employee Directors LTIP are to consist of either common shares currently held or common shares subsequently acquired by Park as treasury shares, including common shares purchased in the open market or in private transactions.

At March 31, 2024, 60,000 common shares were available for future grants under the 2017 Non-Employee Directors LTIP.

During the three months ended March 31, 2024 and 2023, the Compensation Committee of the Board of Directors of Park granted awards of PBRSUs, under the 2017 Employees LTIP, covering an aggregate of 59,165 common shares and 54,698 common shares, respectively, to certain employees of Park and its subsidiaries.

At March 31, 2024, Park reported 191,120 nonvested PBRSUs.

At June 30, 2024, 60,000 common shares were available for future grants under the 2017 Non-Employee Directors LTIP.

During the six months ended June 30, 2024 and 2023, the Compensation Committee of the Board of Directors of Park granted awards of PBRSUs, under the 2017 Employees LTIP, covering an aggregate of 59,165 common shares and 54,698 common shares, respectively, to certain employees of Park and its subsidiaries.

No awards were granted during either of the three months ended June 30, 2024 or 2023.

At June 30, 2024, Park reported 189,620 nonvested PBRSUs.

The number of PBRSUs earned or settled will depend on the level of achievement with respect to certain performance criteria over a three-year period.

The PBRSUs are also subject to subsequent service-based vesting.

A summary of changes in the common shares subject to nonvested PBRSUs for the three months ended March 31, 2024 follows:

A summary of changes in the common shares subject to nonvested PBRSUs for the six months ended June 30, 2024 follows:

Common shares subject to PBRSUs

2 unchanged sentences

Vested ( 54,981 )

Forfeited ( 1,500 )

Adjustment for performance conditions of PBRSUs (1)

Nonvested at March 31, 2024 (2)

Nonvested at June 30, 2024 (2)

(1) The number of PBRSUs earned depends on the level of achievement with respect to certain performance criteria.

1 unchanged sentence

(2) Nonvested amount herein represents the maximum number of nonvested PBRSUs.

As of March 31, 2024, an aggregate of 184,709 PBRSUs were expected to vest.

A summary of awards vested during the three months ended March 31, 2024 and 2023 follows:

As of June 30, 2024, an aggregate of 185,318 PBRSUs were expected to vest.

A summary of awards vested during the three months and six months ended June 30, 2024 and 2023 follows:

Three Months Ended

June 30, Six Months Ended

2024 2023 2024 2023

PBRSUs vested — 6,350 54,981 62,815

1 unchanged sentence

Net common shares issued — 4,358 33,044 38,842

Share-based compensation expense of $ 2.0 million and $ 2.3 million was recognized for the three-month periods ended March 31, 2024 and 2023, respectively.

The following table details expected additional share-based compensation expense related to PBRSUs outstanding at March 31, 2024:

Share-based compensation expense of $ 1.3 million and $ 1.7 million was recognized for the three-month periods ended June 30, 2024 and 2023, respectively, and share-based compensation expense of $ 3.2 million and $ 4.1 million was recognized for the six-month periods ended June 30, 2024 and 2023, respectively.

The following table details expected additional share-based compensation expense related to PBRSUs outstanding at June 30, 2024:

(In thousands)

Nine months ending December 31, 2024 $ 4,495

Six months ending December 31, 2024 $ 3,076

Total $ 12,799

2 unchanged sentences

The Pension Plan provides benefits based on an employee’s years of service and compensation.

There were no Pension Plan contributions for either of the three-month periods ended March 31, 2024 or 2023.

There were no Pension Plan contributions for any of the three-month or the six-month periods ended June 30, 2024 or 2023.

Additionally, no contributions are expected to be made during the remainder of 2024.

1 unchanged sentence

Three Months Ended

March 31, Affected Line Item in the Consolidated

June 30, Six Months Ended

June 30, Affected Line Item in the Consolidated

Condensed Statements of Income

9 unchanged sentences

Park has entered into Supplemental Executive Retirement Plan Agreements (the “SERP Agreements”) with certain key officers of Park and its subsidiaries which provide defined pension benefits in excess of limits imposed by federal tax law.

The expense for the Corporation related to the SERP Agreements for the three months ended March 31, 2024 and 2023 was as follows:

The expense for the Corporation related to the SERP Agreements for the three months and the six months ended June 30, 2024 and 2023 was as follows:

Three Months Ended

March 31, Affected Line Item in the Consolidated

June 30, Six Months Ended

June 30, Affected Line Item in the Consolidated

Condensed Statements of Income

19 unchanged sentences

The following table presents assets and liabilities measured at fair value on a recurring basis:

Fair Value Measurements at March 31, 2024 using:

(In thousands) Level 1 Level 2 Level 3 Balance at March 31, 2024

Fair Value Measurements at June 30, 2024 using:

(In thousands) Level 1 Level 2 Level 3 Balance at June 30, 2024

Investment securities:

36 unchanged sentences

The fair value of the swap agreement entered into with the purchaser of the Visa Class B shares represents an internally developed estimate of the exposure based upon probability-weighted potential Visa litigation losses and is classified as Level 3.

The following tables present a reconciliation of the beginning and ending balances of the Level 3 inputs for the three-month periods ended March 31, 2024 and 2023, for financial instruments measured on a recurring basis and classified as Level 3:

The following tables present a reconciliation of the beginning and ending balances of the Level 3 inputs for the three-month and the six-month periods ended June 30, 2024 and 2023, for financial instruments measured on a recurring basis and classified as Level 3:

Level 3 Fair Value Measurements

Three months ended March 31, 2024 and 2023

Three months ended June 30, 2024 and 2023

(In thousands) Corporate debt securities Equity securities Fair value

Balance at January 1, 2024 $ 6,349 $ 473 $ ( 123 )

Balance at April 1, 2024 $ 6,372 $ 495 $ ( 123 )

Transfer into (out of) level 3 — — —

1 unchanged sentence

Included in other comprehensive income 55 — —

Purchases, sales, issuances and settlements, other, net — — —

Balance at March 31, 2024 $ 6,372 $ 495 $ ( 123 )

Balance at June 30, 2024 $ 6,427 $ 495 $ ( 123 )

Balance at April 1, 2023 $ 6,855 $ 449 $ ( 121 )

Transfer into (out of) level 3, net ( 611 ) — —

Total (losses) / gains

Included in other income / other (expense) — 6 ( 175 )

Included in other comprehensive income ( 128 ) — —

Balance at June 30, 2023 $ 6,116 $ 455 $ ( 296 )

Level 3 Fair Value Measurements

Six months ended June 30, 2024 and 2023

(In thousands) Corporate debt securities Equity securities Fair value

Balance at January 1, 2024 $ 6,349 $ 473 $ ( 123 )

Transfer into level 3 622 — —

Total gains / (losses)

Transfer into (out of) level 3 — — —

Included in other income — 22 —

Included in other comprehensive income 78 — —

Balance at June 30, 2024 $ 6,427 $ 495 $ ( 123 )

Balance at January 1, 2023 $ 7,000 $ 439 $ ( 243 )

Transfers into (out of) level 3, net 11 — —

Total (losses) / gains

Included in other income / other (expense) — 16 ( 175 )

Included in other comprehensive income ( 895 ) — —

Purchases, sales, issuances and settlements, other, net — — 122

Balance at March 31, 2023 $ 6,855 $ 449 $ ( 121 )

Balance at June 30, 2023 $ 6,116 $ 455 $ ( 296 )

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis:

9 unchanged sentences

Individually evaluated loans are evaluated on a quarterly basis for additional impairment and adjusted accordingly.

Additionally, valuations for all collateral dependent loans are updated annually, either through independent valuations by a licensed appraiser or a VOV

performed by an internal licensed appraiser, in accordance with Company policy.

Additionally, valuations for all collateral dependent loans are updated annually, either through independent valuations by a licensed appraiser or a VOV performed by an internal licensed appraiser, in accordance with Company policy.

A VOV can only be used in select circumstances and verifies that the original appraised value has not deteriorated through property inspection, consideration of market conditions, and performance of all valuation methods utilized in a prior valuation.

8 unchanged sentences

Appraisals are generally obtained to support the fair value of collateral.

In general, there are three types of appraisals received by the Company:

In general, there are three types of appraisals received

by the Company:

real estate appraisals, income approach appraisals, and lot development loan appraisals.

18 unchanged sentences

Individually evaluated collateral dependent loans secured by real estate are carried at fair value if they have been charged down to fair value or if a specific valuation allowance has been established.

At March 31, 2024 and December 31, 2023, there were no PCD loans

carried at fair value.

At June 30, 2024 and December 31, 2023, there were no PCD loans carried at fair value.

A new cost basis is established at the time a property is initially recorded in OREO.

OREO are carried at fair value if a devaluation has been taken with respect to the property's value subsequent to the initial measurement.

Fair Value Measurements at March 31, 2024 using:

(In thousands) Level 1 Level 2 Level 3 Balance at March 31, 2024

Fair Value Measurements at June 30, 2024 using:

(In thousands) Level 1 Level 2 Level 3 Balance at June 30, 2024

Individually evaluated collateral dependent loans recorded at fair value:

17 unchanged sentences

The following table provides additional detail on those individually evaluated loans which are recorded at fair value as well as the remaining individually evaluated loan portfolio not included above.

The remaining individually evaluated loans consist of 1) loans which are not collateral dependent, 2) loans which are not secured by real estate, and 3) loans carried at cost as the fair

value of the underlying collateral or the present value of expected future cash flows on each of the loans exceeded the book value for each respective credit.

March 31, 2024

The remaining individually evaluated loans consist of 1) loans which are not collateral dependent, 2) loans which are not secured by real estate, and 3) loans carried at cost as the fair value of the underlying collateral or the present value of expected future cash flows on each of the loans exceeded the book value for each respective credit.

June 30, 2024

(In thousands) Loan Balance Prior Charge-Offs Specific Valuation Allowance Carrying Balance

7 unchanged sentences

Total individually evaluated loans $ 45,215 $ 2,349 $ 4,983 $ 40,232

The expense from credit adjustments related to individually evaluated loans carried at fair value was $ 35,000 and $ 107,000 for the three-month periods ended March 31, 2024 and 2023, respectively.

MSRs totaled $ 14.4 million at March 31, 2024.

Of this $ 14.4 million MSR carrying balance, $ 1.0 million was recorded at fair value and included a valuation allowance of $ 0.1 million.

The remaining $ 13.4 million was recorded at cost, as the fair value exceeded cost at March 31, 2024.

The expense from credit adjustments related to individually evaluated loans carried at fair value was $ 23,000 and $ 551,000 for the three-month periods ended June 30, 2024 and 2023, respectively, and was $ 58,000 and $ 658,000 for the six -month periods ended June 30, 2024 and 2023, respectively.

MSRs totaled $ 14.3 million at June 30, 2024.

Of this $ 14.3 million MSR carrying balance, $ 0.5 million was recorded at fair value and included a valuation allowance of $ 28,000 .

The remaining $ 13.8 million was recorded at cost, as the fair value exceeded cost at June 30, 2024.

At December 31, 2023, MSRs totaled $ 14.7 million.

Of this $ 14.7 million MSR carrying balance, $ 0.9 million was recorded at fair value and included a valuation allowance of $ 0.1 million.

Of this $ 14.7 million MSR carrying balance, $ 0.9 million was recorded at fair value and included a valuation allowance of $ 94,000 .

The remaining $ 13.8 million was recorded at cost, as the fair value exceeded cost at December 31, 2023.

The income r elated to MSRs carried at fair value during the three-month periods ended March 31, 2024 and 2023 was $ 25,000 and $ 14,000 , respectively.

Total OREO held by Park at March 31, 2024 and December 31, 2023 was $ 1.7 million and $ 1.0 million, respectively.

At both March 31, 2024 and December 31, 2023 there was $ 938,000 of OREO held by Park that was carried at fair value due to fair value adjustments made subsequent to the initial OREO measurement.

There was no net (expense) income related to OREO fair value adjustments for the three months ended March 31, 2024.

The net income related to OREO fair value adjustments was $ 15,000 for the three months ended March 31, 2023.

The following tables present qualitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis at March 31, 2024 and December 31, 2023:

March 31, 2024

The income r elated to MSRs carried at fair value during the three-month periods ended June 30, 2024 and 2023 was $ 41,000 and $ 67,000 , respectively, and was $ 66,000 and $ 81,000 for the six -month periods ended June 30, 2024 and 2023, respectively.

Total OREO held by Park at June 30, 2024 and December 31, 2023 was $ 1.2 million and $ 1.0 million, respectively.

At both June 30, 2024 and December 31, 2023 there was $ 938,000 of OREO held by Park that was carried at fair value due to fair value adjustments made subsequent to the initial OREO measurement.

There was no net income (expense) related to OREO fair

value adjustments for the three-month or the six -month periods ended June 30, 2024.

The net expense related to OREO fair value adjustments was $ 77,000 for both the three-month and the six -month periods ended June 30, 2023.

The following tables present qualitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis at June 30, 2024 and December 31, 2023:

June 30, 2024

(In thousands) Fair Value Valuation Technique Unobservable Input(s) Range

21 unchanged sentences

Park's portfolio of Partnership Investments is valued using the NAV practical expedient in accordance with ASC 820.

At March 31, 2024 and at December 31, 2023, Park had Partnership Investments with a NAV of $ 27.0 million and $ 27.5 million, respectively.

At March 31, 2024 and at December 31, 2023, Park had $ 17.9 million and $ 18.4 million, respectively, in unfunded commitments related to these Partnership Investments.

For the three-month periods ended March 31, 2024 and 2023, Park recogniz ed expense of $ 690,000 and $ 378,000 , respectively, related to these Partnership Investments.

The fair value of certain financial instruments at March 31, 2024 and at December 31, 2023, was as follows:

March 31, 2024

At June 30, 2024 and at December 31, 2023, Park had Partnership Investments with a NAV of $ 28.0 million and $ 27.5 million, respectively.

At June 30, 2024 and at December 31, 2023, Park had $ 20.1 million and $ 18.4 million, respectively, in unfunded commitments related to these Partnership Investments.

For the three -month periods ended June 30, 2024 and 2023, Park recogniz ed (expense) income of $( 92,000 ) and $ 137,000 , respectively, and for the six-month periods ended June 30, 2024 and 2023, Park recogniz ed (expense) of $( 782,000 ) and $( 241,000 ), respectively, related to these Partnership Investments.

Fair Value Balance Sheet:

The fair value of certain financial instruments at June 30, 2024 and at December 31, 2023, was as follows:

June 30, 2024

Fair Value Measurements

56 unchanged sentences

All of Park's operations are considered by management to be aggregated in one reportable segment.

The following table presents the Corporation's sources of other income by revenue stream for the three-month periods ended March 31, 2024 and March 31, 2023:

The following table presents the Corporation's sources of other income by revenue stream for the three -month and six-month periods ended June 30, 2024 and June 30, 2023:

Three Months Ended

11 unchanged sentences

Credit card 670 730

HELOC 114 108

Installment 40 35

4 unchanged sentences

ATM fees 458 553

Gain (loss) on sale of OREO, net 121 ( 9 )

Loss on the sale of debt securities, net (2)

Gain on equity securities, net (2)

Other components of net periodic pension benefit income (2)

Miscellaneous (3)

Total other income $ 28,794 $ 25,015

(1) "Other Service Income" totaled $ 2.9 million and $ 2.6 million for the three months ended June 30, 2024 and 2023, respectively.

Of this aggregate revenue approximately $ 1.3 million in each period was within the scope of ASC 606 in each period presented, with the remaining $ 1.6 million and $ 1.3 million consisting primarily of certain residential real estate loan fees which were out of scope for the three months ended June 30, 2024 and 2023, respectively.

(2) Not within the scope of ASC 606.

(3) "Miscellaneous Income" included brokerage income, safe deposit box rentals, gains/losses on asset sales and miscellaneous bank fees totaling $ 1.8 million and $ 0.9 million for the three months ended June 30, 2024 and 2023, respectively, all of which were within the scope of ASC 606.

Six Months Ended

Revenue by Operating Segment (in thousands) 2024 2023

Income from fiduciary activities

Personal trust and agency accounts $ 6,434 $ 5,075

Employee benefit and retirement-related accounts 5,326 4,939

Investment management and investment advisory agency accounts 7,817 6,435

Other 1,175 982

Service charges on deposit accounts

Non-sufficient funds (NSF) fees 1,569 1,921

Demand deposit account (DDA) charges 2,539 2,107

Other 212 254

Other service income (1)

Credit card 1,281 1,413

HELOC 196 197

Installment 60 84

Real estate 3,350 2,965

Commercial 543 677

Debit card fee income 12,823 13,287

Bank owned life insurance income (2)

ATM fees 954 1,086

Loss on the sale of debt securities, net (2)

Loss on equity securities, net (2)

3 unchanged sentences

Total other income $ 54,994 $ 49,402

(1) "Other Service Income" totaled $ 2.5 million and $ 2.7 million for the three months ended March 31, 2024 and 2023, respectively.

Of this aggregate revenue approximately $ 1.2 million and $ 1.4 million was within the scope of ASC 606, with the remaining $ 1.3 million, in each period presented, consisting primarily of certain residential real estate loan fees which were out of scope.

(1) "Other Service Income" totaled $ 5.4 million and $ 5.3 million for the six months ended June 30, 2024 and 2023, respectively.

Of this aggregate revenue approximately $ 2.5 million and $ 2.7 million was within the scope of ASC 606, with the remaining $ 2.9 million and $ 2.6 million consisting primarily of certain residential real estate loan fees which were out of scope for the six months ended June 30, 2024 and 2023, respectively.

(2) Not within the scope of ASC 606.

(3) "Miscellaneous Income" included brokerage income, safe deposit box rentals, and miscellaneous bank fees totaling $ 0.9 million and $ 1.2 million for the three months ended March 31, 2024 and 2023, respectively, all of which were within the scope of ASC 606.

(3) "Miscellaneous Income" included brokerage income, safe deposit box rentals, gains/losses on asset sales and miscellaneous bank fees totaling $ 2.8 million and $ 2.1 million for the six months ended June 30, 2024 and 2023, respectively, all of which were within the scope of ASC 606.

A description of Park's material revenue streams accounted for under ASC 606 follows:

15 unchanged sentences

Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, net of card network fees, concurrently with the transaction processing services provided to the cardholder.

Gain or loss on sale of OREO, net :

The Corporation records a gain or loss from the sale of OREO when control of the property transfers to the buyer, which generally occurs at the time of delivery of an executed deed.

When Park finances the sale of OREO to the buyer, the Corporation assesses whether the buyer is committed to perform the buyer's obligation under the contract and whether collectability of the transaction price is probable.

Once these criteria are met, the OREO asset is derecognized and the gain or loss on sale is recorded upon the transfer of control of the property to the buyer.

In determining the gain or loss on the sale, the Corporation adjusts the transaction price and related gain (loss) on sale if a significant financing component is present.

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 1. Financial Statements