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Item 2. Management’s Discussion and Analysis

2025-05-08 compared with 2024-11-07 · 198 added, 258 removed, 536 unchanged (46% of the section changed)

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As permitted by SEC rules, management presents a sequential quarterly analysis of the Company’s performance as we believe that comparing current quarter results to those of the immediately preceding fiscal quarter is more useful in identifying current business trends and provides a more relevant analysis of our business results.

Accordingly, we have compared our results of operations for the three months ended September 30, 2024 to our results of operations for the three months ended June 30, 2024, as applicable, throughout this Management's Discussion and Analysis of Financial Condition and Results of Operations.

For additional information regarding the Company’s results for the three months ended June 30, 2024, please refer to our second quarter Form 10-Q filed with the SEC on August 6, 2024.

During the first nine months of 2024, we delivered solid results that clearly reflect our driving principles centered on a strong risk management culture, profitability and organic growth.

Accordingly, we have compared our results of operations for the three months ended March 31, 2025 to our results of operations for the three months ended December 31, 2024 and March 31, 2024, as applicable, throughout this Management's Discussion and Analysis of Financial Condition and Results of Operations.

During the first three months of 2025, we demonstrated continued improvement in profitability fundamentals.

Increases in loans and customer deposits combined with a decrease in wholesale funding have driven a healthy increase in our net interest margin and positive trends in total revenue.

While we continue to operate against a backdrop of uncertainty concerning the macroeconomic environment and the timing of lower interest rates, we are comforted by our strong capital and liquidity positions:

• Total deposits as of September 30, 2024 were $21.94 billion, compared to $22.24 billion as of December 31, 2023.

Uninsured non-collateralized deposits as of September 30, 2024 were approximately $4.66 billion, or 21% of total deposits.

• Capital levels were steady during the quarter, with all regulatory capital ratios remaining significantly above “well-capitalized” guidelines as of September 30, 2024 (see Table 11 in the Risk-Based Capital section below).

As of September 30, 2024, our ratio of common equity to total assets was 12.94%, the ratio of tangible common equity to tangible assets was 8.15% and our Tier 1 leverage ratio was 9.57%.

• Key credit quality metrics as of September 30, 2024 also remained solid, with our nonperforming loan coverage ratio at 229% and our allowance for credit losses as a percent of total loans ratio was 1.35%.

• Significant liquidity position with a loan to deposit ratio of 79% and 76% as of September 30, 2024 and December 31, 2023, respectively.

Additional liquidity sources available to us as of September 30, 2024 totaled $11.17 billion and our uninsured, non-collateralized deposit coverage ratio was 2.4x.

Our net income for the three months ended September 30, 2024 was $24.7 million, or $0.20 diluted earnings per share, compared to net income of $40.8 million, or $0.32 diluted earnings per share, for the three months ended June 30, 2024.

Included in the results for the three months ended September 30, 2024 were the impacts of a loss on sale of securities;

results for the three months ended June 30, 2024 included certain items related to a FDIC special assessment.

Also included in both comparative period end results were certain items related to our branch right sizing initiatives, termination of vendor and software services, and early retirement program costs.

Excluding these certain items and the tax effect, adjusted earnings for the three months ended September 30, 2024 were $46.0 million, or $0.37 adjusted diluted earnings per share, compared to $41.9 million, or $0.33 adjusted diluted earnings per share, for the three months ended June 30, 2024.

During the third quarter of 2024, given prevailing market conditions, we executed a strategic decision to sell approximately $251.5 million of AFS investment securities with a weighted average yield of approximately 1.29%, resulting in an after-tax loss of $21.0 million.

The proceeds from the sale were used to pay off higher rate wholesale funding consisting of Federal Home Loan Bank (“FHLB”) advances.

Net income for the nine months ended September 30, 2024 was $104.4 million, or $0.83 diluted earnings per share, compared to net income of $151.2 million, or $1.19 diluted earnings per share, for the nine months ended September 30, 2023.

Included in the results for the nine months ended September 30, 2024 were certain items related to a FDIC special assessment and termination of vendor and software services;

results for the nine months ended September 30, 2023 included certain items related to acquisition costs.

Also included in each comparative period end results were certain items related to branch right sizing initiatives, loss on sale of securities and early retirement program costs.

Excluding these certain items and the tax effect, adjusted earnings for the nine months ended September 30, 2024 were $128.3 million, or $1.02 adjusted diluted earnings per share, compared to $157.5 million, or $1.24 adjusted diluted earnings per share, for the nine months ended September 30, 2023.

In 2024, Simmons Bank was recognized by U.S.

News & World Report as one of the “2024-2025 Best Companies to Work For in the South” and by Forbes as one of “America’s Best-In-State Banks 2024 in Tennessee” and one of “America’s Best-In-State Employers 2024 in Missouri”.

Credit trends throughout the industry are beginning to normalize after an extended period at historically low levels.

Our asset quality metrics remain strong and reflect our conservative credit culture, as well as our focus on maintaining disciplined pricing and conservative underwriting standards given the current economic environment.

Total nonperforming loans as of September 30, 2024, December 31, 2023, and September 30, 2023 were $101.7 million, $84.5 million, and $81.9 million, respectively.

Non-performing assets as a percent of total assets were 0.38% at September 30, 2024, compared to 0.33% at December 31, 2023 and 0.32% at September 30, 2023.

As of September 30, 2024, stockholders’ equity was $3.53 billion, book value per share was $28.11 and tangible book value per share was $16.78.

Total loans were $17.34 billion at September 30, 2024, compared to $16.85 billion at December 31, 2023.

Our unfunded commitments were $3.96 billion and $4.17 billion as of September 30, 2024 and December 31, 2023, respectively.

Our commercial loan pipeline totaled $1.24 billion as of September 30, 2024, compared to $948.2 million at December 31, 2023.

• Total deposits as of March 31, 2025 were $21.68 billion, compared to $21.89 billion as of December 31, 2024.

Uninsured, non-collateralized deposits as of March 31, 2025 were approximately $4.54 billion, or 21% of total deposits.

• Capital levels were steady during the quarter, with all regulatory capital ratios remaining significantly above “well-capitalized” guidelines as of March 31, 2025 (see Table 11 in the Risk-Based Capital section below).

As of March 31, 2025, our ratio of common equity to total assets was 13.18%, the ratio of tangible common equity to tangible assets was 8.34% and our Tier 1 leverage ratio was 9.83%.

• Significant liquidity position with a loan to deposit ratio of 79% and 78% as of March 31, 2025 and December 31, 2024, respectively.

Additional liquidity sources available to us as of March 31, 2025 totaled $10.41 billion and our uninsured, non-collateralized deposit coverage ratio was 2.3x.

Our net income for the three months ended March 31, 2025 was $32.4 million, or $0.26 diluted earnings per share, compared to net income of $48.3 million, or $0.38 diluted earnings per share, and $38.9 million, or $0.31 diluted earnings per share, for the three months ended December 31, 2024 and March 31, 2024, respectively.

Included in the results were certain items related to our branch right sizing initiatives, early retirement program costs (for the three months ended March 31, 2024 and December 31, 2024) and a FDIC special assessment (for the three months ended March 31, 2024).

Excluding these certain items and the tax effect, adjusted earnings for the three months ended March 31, 2025 were $33.1 million, or $0.26 adjusted diluted earnings per share, compared to $49.6 million, or $0.39 adjusted diluted earnings per share, and $40.4 million, or $0.32 adjusted diluted earnings per share, for the three months ended December 31, 2024 and March 31, 2024, respectively.

During the quarter, we increased the loss provision on two specific credit relationships that we have been watching for some time due to unfavorable events that occurred for both during the three months ended March 31, 2025.

Otherwise, we believe the asset quality in our portfolio remains sound and reflects our conservative credit culture, as well as our focus on maintaining disciplined pricing and conservative underwriting standards given the current economic environment.

Total nonperforming loans as of March 31, 2025, December 31, 2024, and March 31, 2024 were $152.4 million, $110.8 million, and $107.3 million, respectively.

Nonperforming assets as a percent of total assets were 0.61% at March 31, 2025, compared to 0.45% at December 31, 2024 and 0.41% at March 31, 2024.

As of March 31, 2025, stockholders’ equity was $3.53 billion, book value per share was $28.04 and tangible book value per share was $16.81.

Total loans were $17.09 billion at March 31, 2025, compared to $17.01 billion at December 31, 2024.

Our unfunded commitments were $4.19 billion and $4.03 billion as of March 31, 2025 and December 31, 2024, respectively.

Our commercial loan pipeline totaled $1.81 billion as of March 31, 2025, compared to $1.26 billion at December 31, 2024.

In our discussion and analysis of our financial condition and results of operation in this Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” we provide certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States (“US GAAP”).

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See the GAAP Reconciliation of Non-GAAP Financial Measures section below for additional discussion and reconciliations of non-GAAP measures.

Simmons First National Corporation is a Mid-South based financial holding company that, as of September 30, 2024, has approximately $27.3 billion in consolidated assets and, through its subsidiaries, conducts financial operations in Arkansas, Kansas, Missouri, Oklahoma, Tennessee and Texas.

Simmons First National Corporation is a Mid-South based financial holding company that, as of March 31, 2025, has approximately $26.8 billion in consolidated assets and, through its subsidiaries, conducts financial operations in Arkansas, Kansas, Missouri, Oklahoma, Tennessee and Texas.

CRITICAL ACCOUNTING ESTIMATES

We follow accounting and reporting policies that conform, in all material respects, to US GAAP and to general practices within the financial services industry.

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.

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The allowance, in the judgment of management, is necessary to reserve for expected credit losses and risks inherent in the loan portfolio.

Our allowance for credit loss methodology includes reserve factors calculated to estimate current expected credit losses to amortized cost balances over the remaining contractual life of the portfolio, adjusted for prepayments, in accordance with ASC Topic 326-20, Financial Instruments - Credit Losses .

Our allowance for credit loss methodology includes reserve factors calculated to estimate current expected credit losses to amortized cost balances over the remaining contractual life of the portfolio, adjusted for prepayments, in accordance with Accounting Standards Codification (“ASC”) Topic 326-20, Financial Instruments - Credit Losses .

Accordingly, the methodology is based on our reasonable and supportable economic forecasts, historical loss experience and other qualitative adjustments.

For further information see the section Allowance for Credit Losses below.

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Results are compared to book value;

no impairment was indicated as of September 30, 2024.

no impairment was indicated as of March 31, 2025.

Judgement is inherent in assessing goodwill for impairment.

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Net interest income, our principal source of earnings, is the difference between the interest income generated by earning assets and the total interest cost of the deposits and borrowings obtained to fund those assets.

Factors that determine the level of net interest income include the volume of earning assets and interest bearing liabilities, yields earned and rates paid, the level of non-performing loans and the amount of noninterest bearing liabilities supporting earning assets.

Factors that determine the level of net interest income include the volume of earning assets and interest bearing liabilities, yields earned and rates paid, the level of nonperforming loans and the amount of noninterest bearing liabilities supporting earning assets.

Net interest income is analyzed in the discussion and tables below on a fully taxable equivalent basis.

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In the last several years, on average, approximately 44% of our loan portfolio and approximately 92% of our time deposits have repriced in one year or less.

As of September 30, 2024, our interest rate sensitivity shows that approximately 46% of our loans and 94% of our time deposits will reprice in the next year.

As of March 31, 2025, our interest rate sensitivity shows that approximately 51% of our loans and 97% of our time deposits will reprice in the next year.

Net Interest Income - Sequential Quarter Analysis

For the three month period ended September 30, 2024, net interest income on a fully taxable equivalent basis was $164.1 million, an increase of $3.6 million, or 2.3%, compared to the three months ended June 30, 2024.

The increase in net interest income was primarily the result of a $5.0 million increase in fully tax equivalent interest income, partially offset by a $1.3 million increase in interest expense.

The increase in interest income on a fully taxable equivalent basis primarily resulted from a $6.9 million increase in interest income on loans, partially offset by a decrease of $1.9 million in interest income on investment securities.

The increase in interest income provided by loans reflects an increase attributable to loan volume of $1.7 million, coupled with a $5.2 million increase in interest income related to loan yield.

The loan yield for the third quarter of 2024 was 6.44% compared to 6.39% from the preceding sequential quarter, representing a 5 basis point increase.

The decrease in interest income on investment securities was primarily related to a $2.0 million decrease attributable to volume related to our taxable investment portfolio, as our portfolio experienced pay downs, maturities, and a strategic sale of $251.5 million of lower-yielding available-for-sale (“AFS”) securities to pay off higher rate wholesale fundings consisting of FHLB advances during the three months ended September 30, 2024.

The $1.3 million increase in interest expense is mostly due to the additional reliance on other wholesale borrowings sources, primarily FHLB advances, which led to a $2.0 million increase in interest expense during the quarter.

Interest expense decreased by $2.1 million due to the decrease in deposit volume over the period, which was partially offset by the $1.3 million increase related to rates, largely due to the modest 2 basis point increase related to time deposit accounts, as we believe deposit costs appeared to have peaked during the third quarter of 2024.

For the three month period ended March 31, 2025, net interest income on a fully taxable equivalent basis was $169.8 million, a decrease of $1.5 million, or 0.9%, compared to the three months ended December 31, 2024.

The decrease in net interest income was primarily the result of an $18.2 million decrease in fully tax equivalent interest income, partially offset by a $16.6 million decrease in interest expense.

The decrease in interest income on a fully taxable equivalent basis primarily resulted from a $15.0 million decrease in interest income on loans, coupled with a decrease of $2.9 million in interest income on investment securities.

The decrease in interest income provided by loans reflects a decrease attributable to loan volume of $4.6 million, coupled with a $10.4 million decrease in interest income related to loan yield.

The loan yield for the first quarter of 2025 was 6.20% compared to 6.32% from the preceding sequential quarter, representing a 12 basis point decrease.

The decrease in interest income on investment securities was primarily related to a $2.0 million decrease in interest income on taxable investment securities due to yield decreases of 15 basis points, combined with an $862,000 decrease attributable to volume related to our taxable investment portfolio, as our portfolio experienced pay downs and maturities during the three months ended March 31, 2025.

The decrease in earning asset yields on a linked quarter basis was primarily driven by interest rate cuts at the end of 2024.

The $16.6 million decrease in interest expense is mostly due to the $11.4 million decrease related to deposit rates, largely due to the 23 basis point decrease related to deposit accounts, corresponding with the rate cuts mentioned previously.

Also contributing to the decrease in interest expense over the comparative quarters are reductions in the outstanding balances under and rates on wholesale borrowings sources, which led to a $3.7 million decrease in interest expense during the quarter.

Net Interest Income - Year-over-Year Analysis

Net interest income on a fully taxable equivalent basis for the nine month period ended September 30, 2024 decreased $30.5 million, or 5.9%, over the same period in 2023.

The decrease in net interest income on a fully taxable equivalent basis was the result of a $99.9 million increase in fully tax equivalent interest income, more than offset by a $130.4 million increase in interest expense.

The increase in interest income during the nine month period ended September 30, 2024 resulted from increases in interest income on loans and investments, primarily as a result of higher market interest rates.

The increase in interest income on loans of $82.9 million reflects an increase attributable to loan volume of $21.2 million coupled with a 48 basis point rise in loan yield that resulted in a $61.7 million increase.

The increase attributable to loan volume was due to solid organic loan growth over the comparative period.

The increase of $18.4 million in interest income on investment securities is primarily related to an increase of $37.1 million in interest income on taxable investment securities due to yield increases over the period of 116 basis points.

The increase in interest income on taxable investment securities due to yield increases was mitigated by an $18.4 million decrease due to the decline in our taxable investment portfolio average balances which decreased by $788.2 million or 16.4%, as our portfolio experienced pay downs, maturities, the strategic sale of lower-yielding AFS securities during the third quarter of 2024 as discussed above and a strategic sale of $241.1 million of lower-yielding AFS securities late in the fourth quarter of 2023, the proceeds of which we used to pay off higher-rate wholesale fundings in each period.

The $130.4 million increase in interest expense is mainly due to the increase in our deposit account rates over the period, combined with the change in deposit mix as the market experiences a shift in consumer sentiment given the attractiveness of higher yielding time deposits in the current higher interest rate environment.

Interest expense increased $114.8 million due to the increase in rate of 92 basis points on interest-bearing deposit accounts and $13.3 million due to the increase in deposit volume over the period.

Further, an increase of $2.9 million in interest expense was related to an increase in rates on our subordinated debentures during the same period.

Net interest income on a fully taxable equivalent basis for the three month period ended March 31, 2025 increased $11.5 million, or 7.3%, over the same period in 2024.

The increase in net interest income on a fully taxable equivalent basis was the result of a $14.8 million decrease in fully tax equivalent interest income, more than offset by a $26.3 million decrease in interest expense.

The decrease in interest income during the three month period ended March 31, 2025 primarily resulted from decreases in interest income on loans and investments.

The decrease in interest income on loans was largely attributable to a 4 basis point decline in loan yield that resulted in a decrease of $4.1 million.

Loan volume was relatively flat over the comparative periods.

The decrease of $10.7 million in interest income on investment securities is primarily related to a $5.9 million decrease in interest income on taxable investment securities due to the decline in our taxable investment portfolio average balances which decreased by $621.9 million or 14.9%, as our portfolio experienced pay downs, maturities and a strategic sale of $251.5 million of lower-yielding available-for-sale (“AFS”) securities to pay off higher rate wholesale fundings consisting of Federal Home Loan Bank (“FHLB”) advances during the third quarter of 2024.

A yield decrease in the taxable investment portfolio over the period of 46 basis points led to a decrease of $4.7 million in interest income on taxable investment securities.

The $26.3 million decrease in interest expense is mainly due to the decrease in our deposit account rates over the period.

Interest expense decreased $18.6 million due to the decrease in rate of 43 basis points on interest-bearing deposit accounts and $2.8 million due to the decrease in deposit volume over the period.

Further, a decrease of $3.9 million in interest expense was related to reductions in the amounts outstanding under and rates on wholesale borrowings sources over the comparative period.

We continually monitor and look for opportunities to fairly reprice our deposits while remaining competitive in this current challenging rate environment.

Net Interest Margin

Our net interest margin on a fully tax equivalent basis was 2.74% and 2.70% for the three and nine month periods ended September 30, 2024, as compared to 2.69% and 2.82% for the three months ended June 30, 2024 and the nine months ended September 30, 2023, respectively.

Net interest margin experienced a 5 basis point increase for the three months ended September 30, 2024 compared to the preceding sequential quarter, while net interest margin decreased 12 basis points during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023.

The increase as compared to the preceding sequential quarter was aided by the strategic sale of lower-yielding AFS investment securities during the three month period ended September 30, 2024.

The decrease when compared to the same period in the prior year was primarily due to the rising deposit rate pressure from increased market competition and consumer migration toward higher rate deposits.

Our net interest margin on a fully tax equivalent basis was 2.95% for the three month period ended March 31, 2025, as compared to 2.87% and 2.66% for the three months ended December 31, 2024 and the three months ended March 31, 2024, respectively.

Net interest margin experienced an 8 basis point increase for the three months ended March 31, 2025 compared to the preceding sequential quarter, while net interest margin increased 29 basis points during the three months ended March 31, 2025 compared to the three months ended March 31, 2024.

The increase over both comparative periods was primarily due to lower deposits costs, as well as the reduced rate and use of wholesale funding that more than offset a decline on the yield and volume of earning assets.

The increase when compared to the same period in the prior year was also aided by the strategic sale of lower-yielding AFS investment securities during the third quarter of 2024.

Net Interest Income Tables

Tables 1 and 2 reflect an analysis of net interest income on a fully taxable equivalent basis for the three months ended September 30, 2024 and June 30, 2024 and the nine months ended September 30, 2024 and 2023, respectively.

Tables 1 and 2 reflect an analysis of net interest income on a fully taxable equivalent basis for the three months ended March 31, 2025, December 31, 2024 and March 31, 2024, respectively.

Analysis of Net Interest Margin

(FTE = Fully Taxable Equivalent using an effective tax rate of 26.135%)

Three Months Ended Nine Months Ended

September 30, June 30, September 30, September 30,

Three Months Ended

March 31, December 31, March 31,

(In thousands) 2025 2024 2024

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Changes in Fully Taxable Equivalent Net Interest Margin

Three Months Ended Nine Months Ended

(In thousands) September 30, 2024 compared to June 30, 2024 September 30, 2024 compared to September 30, 2023

Three Months Ended

(In thousands) March 31, 2025 compared to December 31, 2024 March 31, 2025 compared to March 31, 2024

Decrease due to change in earning assets $ (5,663) $ (5,427)

Increase due to change in earning asset yields 5,249 102,169

Increase (decrease) due to change in interest bearing liabilities 196 (9,788)

Decrease due to change in interest rates paid on interest bearing liabilities (1,533) (120,627)

Decrease due to change in earning asset yields (12,492) (9,393)

Increase due to change in interest bearing liabilities 3,760 4,907

Increase due to change in interest rates paid on interest bearing liabilities 12,865 21,421

Increase (decrease) in net interest income $ (1,530) $ 11,508

Table 3 shows, for each major category of earning assets and interest bearing liabilities, the average (computed on a daily basis) amount outstanding, the interest earned or expensed on such amount and the average rate earned or expensed for the three months ended September 30, 2024 and June 30, 2024 and the nine months ended September 30, 2024 and 2023, respectively.

Table 3 shows, for each major category of earning assets and interest bearing liabilities, the average (computed on a daily basis) amount outstanding, the interest earned or expensed on such amount and the average rate earned or expensed for the three months ended March 31, 2025, December 31, 2024 and March 31, 2024, respectively.

The table also shows the average rate earned on all earning assets, the average rate expensed on all interest bearing liabilities, the net interest spread and the net interest margin for the same periods.

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Three Months Ended

September 30, 2024 June 30, 2024

Average Income/ Yield/ Average Income/ Yield/

(In thousands) Balance Expense Rate (%) Balance Expense Rate (%)

Earning assets:

Interest bearing balances due from banks and federal funds sold $ 204,505 $ 2,921 5.68 $ 214,777 $ 2,964 5.55

Investment securities - taxable 3,826,934 37,473 3.90 4,035,508 39,283 3.92

Investment securities - non-taxable 2,617,532 21,318 3.24 2,597,005 21,429 3.32

Mortgage loans held for sale 12,425 209 6.69 10,328 194 7.55

Loans - including fees 17,208,162 278,766 6.44 17,101,799 271,851 6.39

Total interest earning assets 23,869,558 340,687 5.68 23,959,417 335,721 5.64

Non-earning assets 3,346,882 3,345,860

Total assets $ 27,216,440 $ 27,305,277

LIABILITIES AND STOCKHOLDERS’ EQUITY

Interest bearing liabilities:

Interest bearing transaction and savings deposits $ 10,826,514 $ 78,307 2.88 $ 10,973,462 $ 79,087 2.90

Time deposits 6,355,801 73,937 4.63 6,447,259 73,946 4.61

Total interest bearing deposits 17,182,315 152,244 3.52 17,420,721 153,033 3.53

Federal funds purchased and securities sold under agreements to repurchase 51,830 138 1.06 50,558 156 1.24

Other borrowings 1,252,435 17,067 5.42 1,111,734 15,025 5.44

Subordinated debt and debentures 366,236 7,128 7.74 366,198 7,026 7.72

Total interest bearing liabilities 18,852,816 176,577 3.73 18,949,211 175,240 3.72

Noninterest bearing liabilities:

Noninterest bearing deposits 4,535,105 4,624,819

Other liabilities 323,378 280,092

Total liabilities 23,711,299 23,854,122

Stockholders’ equity 3,505,141 3,451,155

Total liabilities and stockholders’ equity $ 27,216,440 $ 27,305,277

Net interest spread – FTE 1.95 1.92

Net interest margin – FTE $ 164,110 2.74 $ 160,481 2.69

Nine Months Ended

September 30, 2024 September 30, 2023

Average Income/ Yield/ Average Income/ Yield/

(In thousands) Balance Expense Rate (%) Balance Expense Rate (%)

March 31, 2025 December 31, 2024 March 31, 2024

Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/

(In thousands) Balance Expense Rate (%) Balance Expense Rate (%) Balance Expense Rate (%)

Earning assets:

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Net interest margin – FTE $ 169,836 2.95 $ 171,366 2.87 $ 158,328 2.66

Table 4 shows changes in interest income and interest expense resulting from changes in both volume and interest rates for the three months ended September 30, 2024 as compared to the three months ended June 30, 2024 and the nine months ended September 30, 2024 and 2023, respectively.

Table 4 shows changes in interest income and interest expense resulting from changes in both volume and interest rates for the three months ended March 31, 2025 as compared to the three months ended December 31, 2024 and March 31, 2024, respectively.

The changes in interest rate and volume have been allocated to changes in average volume and changes in average rates in proportion to the relationship of absolute dollar amounts of the changes in rates and volume.

Volume/Rate Analysis

Three Months Ended Nine Months Ended

September 30, 2024 compared to June 30, 2024 September 30, 2024 compared to September 30, 2023

Three Months Ended

March 31, 2025 compared to December 31, 2024 March 31, 2025 compared to March 31, 2024

(In thousands, on a fully taxable equivalent basis) Volume Yield/

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The provision for credit losses represents management’s determination of the amount necessary to be charged against the current period’s earnings in order to maintain the allowance for credit losses at a level considered appropriate in relation to the estimated lifetime risk inherent in the loan portfolio.

The level of provision to the allowance is based on management’s judgment, with consideration given to the composition, maturity and other qualitative characteristics of the portfolio, assessment of current economic conditions, reasonable and supportable forecasts, past due and non-performing loans and historical net credit loss experience.

The level of provision to the allowance is based on management’s judgment, with consideration given to the composition, maturity and other qualitative characteristics of the portfolio, assessment of current economic conditions, reasonable and supportable forecasts, past due and nonperforming loans and historical net credit loss experience.

It is management’s practice to review the allowance on a monthly basis and, after considering the factors previously noted, to determine the level of provision made to the allowance.

The provision for credit losses for the three months ended September 30, 2024 was $12.1 million as compared to $11.1 million for the three months ended June 30, 2024.

The provision for credit losses for the three months ended March 31, 2025 was $26.8 million as compared to $13.3 million for the three months ended December 31, 2024.

Provision expense for both periods was related to loans and reflected loan growth in the quarters, as well as the impact of updated economic assumptions.

For the nine months ended September 30, 2024, our provision for credit losses was $33.5 million as compared to $32.0 million for the same period ended September 30, 2023.

Provision expense for the nine months ended September 30, 2024 was related to loans and reflected loan growth in the quarter, as well as the impact of updated economic assumptions.

Provision expense for the same period ended September 30, 2023 consisted of a $36.2 million expense related to loans and was primarily due to the impacts described above, which was partially offset by the recapture of $16.3 million reflecting the continued decline in unfunded commitments over the period, and a $12.1 million expense related to securities which was primarily due to decreases in the value of corporate bonds in the investment securities portfolio.

For the three months ended March 31, 2025, our provision for credit losses was $26.8 million as compared to $10.2 million for the same period ended March 31, 2024.

The provision expense for the three months ended March 31, 2025 reflected a provision expense of $15.6 million related to two specific credit relationships which migrated to nonperforming during the period, as well as the impact of updated economic assumptions reflecting increased uncertainty.

Provision expense for the same period ended March 31, 2024 was related to loans and reflected loan growth in the quarter, as well as the impact of updated economic assumptions.

NONINTEREST INCOME

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Noninterest income also includes income on the sale of mortgage loans, income from the increase in cash surrender values of bank owned life insurance and gains (losses) from sales of securities.

For the three month period ended September 30, 2024, total noninterest income was $17.1 million, a decrease of approximately $26.2 million or 60.4%, compared to the three month period ended June 30, 2024.

The majority of the decrease in noninterest income during the three months ended September 30, 2024 was due to a loss on sale of securities of $28.4 million.

During the period, we sold approximately $251.5 million of AFS investment securities as part of a strategic decision to sell low yielding securities to pay off higher rate wholesale fundings consisting of FHLB advances.

Adjusting for this certain item, adjusted noninterest income for the three month period ended September 30, 2024 increased $2.2 million, or 5.1%, from the prior sequential quarter.

The increase in adjusted noninterest income on a sequential quarter basis was primarily due to an increase in other income of $1.9 million from the prior sequential quarter reflecting gains on the sale of other real estate owned largely related to two properties sold during the quarter.

Noninterest income for the nine months ended September 30, 2024 decreased by approximately $30.0 million or 22.4% as compared to the nine months ended September 30, 2023.

The decrease, as compared to the same period in 2023, was primarily due to losses on sale of securities of $28.4 million discussed above and $391,000, recognized during each respective period.

Adjusting for these certain items, adjusted noninterest income for the nine month period ended September 30, 2024 decreased $2.0 million, or 1.5%, from the prior comparative period.

The decrease on an adjusted basis was related to a $6.6 million decrease in other income due to a $4.0 million legal reserve recapture associated with litigation, coupled with fair value adjustments related to Small Business Investment Company (“SBIC”) investments and death benefits from bank owned life insurance totaling $3.5 million recorded during the nine months ended September 30, 2023.

Partially offsetting the decrease in other income was an increase of $2.8 million in bank owned life insurance income during the nine months ended September 30, 2024 related to a higher earnings credit rate as compared to the prior period.

Table 5 shows noninterest income for the three month periods ended September 30, 2024 and June 30, 2024 and the nine months ended September 30, 2024 and 2023, respectively, as well as changes between periods.

For the three month period ended March 31, 2025, total noninterest income was $46.2 million, an increase of approximately $2.6 million or 6.0%, compared to the three month period ended December 31, 2024 and an increase of $3.0 million or 6.9%, as compared to the three months ended March 31, 2024.

The increase for the three month period ended March 31, 2025 to both comparative periods is primarily related to an increase in fair value adjustments related to Small Business Investment Company (“SBIC”) investments and increased swap fee income, which are both included in “Other income” in the table below.

The increase for the three month period ended March 31, 2025 as compared to the same period in 2024 was also due to a $1.2 million increase in wealth management fees.

Table 5 shows noninterest income for the three month periods ended March 31, 2025, December 31, 2024 and March 31, 2024, respectively, as well as changes between periods.

Noninterest Income

Three Months Ended Nine Months Ended

September 30, June 30, Change September 30, September 30, Change

Three Months Ended

March 31, December 31, March 31, Change from Quarter - Sequential Change from Quarter - Year-over-Year

(Dollars in thousands) 2025 2024 2024

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Other service charges and fees 1,333 1,426 1,279 (93) (6.5) 54 4.2

Loss on sale of securities, net (28,393) — (28,393) * (28,393) (391) (28,002) *

Other income 8,007 5,565 7,172 2,442 43.9 835 11.6

Total noninterest income $ 46,155 $ 43,558 $ 43,184 $ 2,597 6.0% $ 2,971 6.9%

_________________________

*Not meaningful

Recurring fee income (total service charges, wealth management fees, debit and credit card fees) was $31.5 million and $31.0 million for the three month periods ended September 30, 2024 and June 30, 2024, respectively, and was $92.4 million and $90.7 million for the nine month periods ended September 30, 2024 and 2023, respectively.

Recurring fee income (total service charges, wealth management fees, debit and credit card fees) was $32.0 million, $32.4 million and $29.9 million for the three month periods ended March 31, 2025, December 31, 2024 and March 31, 2024, respectively.

NONINTEREST EXPENSE

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We also regularly monitor staffing levels at each subsidiary to ensure productivity and overhead are in line with existing workload requirements.

Noninterest expense was $137.2 million for the three month period ended September 30, 2024, as compared to noninterest expense of $139.4 million for the three month period ended June 30, 2024, representing a decrease of $2.2 million, or 1.6%, as compared to the preceding quarter.

Adjusted noninterest expense, which excludes branch right sizing, early retirement program costs, termination of vendor and software services, and FDIC special assessment (for the three months ended June 30, 2024), for the three months ended September 30, 2024 was $136.8 million, a decrease of $1.0 million as compared to the three months ended June 30, 2024.

Noninterest expense for the nine months ended September 30, 2024 increased by approximately $1.5 million or 0.4% as compared to the nine months ended September 30, 2023.

Adjusted noninterest expense, which excludes branch right sizing, merger related costs (for the nine months ended September 30, 2023), FDIC special assessment (for the nine months ended September 30, 2024), termination of vendor and software services (for the nine months ended September 30, 2024) and early retirement program costs, increased $5.8 million, or 1.4%, as compared to the nine months ended September 30, 2023.

Salaries and employee benefits expense decreased $1.5 million during the three month period ended September 30, 2024 as compared to the preceding sequential quarter and decreased $6.6 million during the nine month period ended September 30, 2024 when compared to the same period in the prior year.

Adjusted salaries and employee benefits expense, which excludes early retirement program costs, for the three months ended September 30, 2024, decreased $1.4 million, or 2.0%, as compared to the preceding sequential quarter and decreased $1.8 million, or 0.8%, during the nine month period ended September 30, 2024 when compared to the same period in the prior year.

The decrease as compared to the preceding sequential quarter reflects incentive compensation accrual adjustments, while the decrease as compared to the same period in the prior year is primarily due to the successful execution of programs as part of our Better Bank Initiative.

Deposit insurance expense for the three and nine months ended September 30, 2024 as compared to the three months ended June 30, 2024 and nine months ended September 30, 2023 decreased by $111,000 and increased by $3.6 million, respectively.

While the variance in deposit insurance expense on a sequential quarter basis is relatively flat, the increase on a year over year basis for the nine months ended September 30, 2024 is significantly attributable to the additional FDIC special assessments totaling $1.8 million during the nine months ended September 30, 2024, which were levied to support the Deposit Insurance Fund following the failure of certain banks in 2023, coupled with base assessment rate increases related to changes in the mix of deposits.

Table 6 below shows noninterest expense for the three month periods ended September 30, 2024 and June 30, 2024 and the nine months ended September 30, 2024 and 2023, respectively, as well as changes between periods.

Noninterest expense was $144.6 million for the three month period ended March 31, 2025, as compared to noninterest expense of $141.1 million for the three month period ended December 31, 2024, representing an increase of $3.5 million, or 2.5%, as compared to the preceding quarter.

Adjusted noninterest expense, which excludes branch right sizing and early retirement program costs (for the three months ended December 31, 2024), for the three months ended March 31, 2025 was $143.6 million, an increase of $4.3 million as compared to the three months ended December 31, 2024.

Noninterest expense for the three months ended March 31, 2025 increased by approximately $4.7 million or 3.4% as compared to the three months ended March 31, 2024.

Adjusted noninterest expense, which excludes branch right sizing, FDIC special assessment (for the three months ended March 31, 2024) and early retirement program costs (for the three months ended March 31, 2024), increased $5.7 million, or 4.1%, as compared to the three months ended March 31, 2024.

Other noninterest expense increased $3.2 million during the three month period ended March 31, 2025 as compared to the preceding sequential quarter and increased $3.1 million during the three month period ended March 31, 2025 when compared to the same period in the prior year.

The increase during the three month period ended March 31, 2025 as compared to both periods is primarily due to a $4.3 million charge related to a commercial customer deposit fraud event that was identified during the period.

Salaries and employee benefits expense increased $3.2 million during the three month period ended March 31, 2025 as compared to the preceding sequential quarter and increased $2.2 million during the three month period ended March 31, 2025 when compared to the same period in the prior year.

The increase as compared to the preceding sequential quarter is primarily due to higher payroll taxes typically incurred during the first quarter, while the increase as compared to the same period in the prior year is primarily due to employee merit increases over the comparative periods.

Deposit insurance expense for the three months ended March 31, 2025 as compared to the three months ended December 31, 2024 and three months ended March 31, 2024 decreased by $159,000 and $1.7 million, respectively.

While the variance in deposit insurance expense on a sequential quarter basis is relatively flat, the decrease on a year over year basis for the three months ended March 31, 2025 is significantly attributable to the additional FDIC special assessments totaling $1.5 million during the three months ended March 31, 2024, which were levied to support the Deposit Insurance Fund following the failure of certain banks in 2023.

Table 6 below shows noninterest expense for the three month periods ended March 31, 2025, December 31, 2024 and March 31, 2024, respectively, as well as changes between periods.

Noninterest Expense

Three Months Ended Nine Months Ended

September 30, June 30, Change September 30, September 30, Change

Three Months Ended

March 31, December 31, March 31, Change from Quarter - Sequential Change from Quarter - Year-over-Year

(Dollars in thousands) 2025 2024 2024

Salaries and employee benefits $ 74,824 $ 71,588 $ 72,653 $ 3,236 4.5% $ 2,171 3.0%

Early retirement program (1) 118 (119) (100.9) 336 5,166 (4,830) (93.5)

Occupancy expense, net 12,651 11,876 12,258 775 6.5 393 3.2

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Deposit insurance 5,391 5,550 7,135 (159) (2.9) (1,744) (24.4)

Merger related costs — — — — — 1,420 (1,420) (100.0)

Other operating expenses:

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Total noninterest expense $ 144,580 $ 141,117 $ 139,879 $ 3,463 2.5% $ 4,701 3.4%

_________________________

*Not meaningful

INVESTMENTS AND SECURITIES

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Our general policy is not to invest in derivative type investments or high-risk securities, except for collateralized MBS for which collection of principal and interest is not subordinated to significant superior rights held by others.

HTM and AFS investment securities were $3.66 billion and $2.69 billion, respectively, at September 30, 2024, compared to the HTM amount of $3.73 billion and AFS amount of $3.15 billion at December 31, 2023.

HTM and AFS investment securities were $3.62 billion and $2.49 billion, respectively, at March 31, 2025, compared to the HTM amount of $3.64 billion and AFS amount of $2.53 billion at December 31, 2024.

We continue to look for opportunities to maximize the value of the investment portfolio.

During the quarters ended June 30, 2022 and September 30, 2021, we transferred, at fair value, $1.99 billion and $500.8 million, respectively, of securities from the AFS portfolio to the HTM portfolio.

The related remaining combined net unrealized losses of $112.7 million in accumulated other comprehensive income (loss) as of September 30, 2024 will be amortized over the remaining life of the securities.

The related remaining combined net unrealized losses of $103.8 million in accumulated other comprehensive income (loss) as of March 31, 2025 will be amortized over the remaining life of the securities.

No gains or losses on these securities were recognized at the time of transfer.

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We expect the cash flows from principal maturities of securities to provide flexibility to fund future loan growth or reduce wholesale funding.

During the three month period ended September 30, 2024, we sold approximately $251.5 million of AFS investment securities as part of a strategic decision to sell low yielding securities to pay off higher rate wholesale fundings consisting of FHLB advances resulting in a gross realized loss of $28.4 million.

Furthermore, as of September 30, 2024, we have the ability to hold the securities classified as AFS for a period of time sufficient for a recovery of amortized cost, we do not have an immediate intent to sell the securities classified as AFS, and we believe the accounting standard of “more likely than not” has not been met regarding whether we would be required to sell any of the AFS securities before recovery of amortized cost.

For the remainder of 2024, we will continue to evaluate targeted sales of AFS securities based on prevailing market conditions and our funding and liquidity positions.

Furthermore, as of March 31, 2025, we have the ability to hold the securities classified as AFS for a period of time sufficient for a recovery of amortized cost, we do not have an immediate intent to sell the securities classified as AFS, and we believe the accounting standard of “more likely than not” has not been met regarding whether we would be required to sell any of the AFS securities before recovery of amortized cost.

For the remainder of 2025, we may continue to evaluate targeted sales of AFS securities based on prevailing market conditions and our funding and liquidity positions.

The unrealized losses are largely due to increases in market interest rates over the yields available at the time the underlying securities were purchased.

The fair value is expected to recover as the bonds approach their maturity date or repricing date or if market yields for such investments decline.

Accordingly, as of September 30, 2024, we believe the declines in fair value are temporary and we do not believe any of the securities are impaired due to reasons of credit quality.

Accordingly, as of March 31, 2025, we believe the declines in fair value are temporary and we do not believe any of the securities are impaired due to reasons of credit quality.

During the third quarter of 2021, we began utilizing interest rate swaps designated as fair value hedges to mitigate the effect of changing interest rates on the fair values of $1.00 billion of fixed rate callable municipal securities held in the AFS portfolio.

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Securities within these swap agreements have maturity dates varying between 2028 and 2029.

For the nine months ended September 30, 2024, the net amount included in interest income on investment securities in the consolidated statements of income related to these swap agreements was $33.8 million.

For the three months ended March 31, 2025, the net amount included in interest income on investment securities in the consolidated statements of income related to these swap agreements was $7.9 million.

LOAN PORTFOLIO

Our loan portfolio averaged $17.07 billion and $16.60 billion during the first nine months of 2024 and 2023, respectively.

As of September 30, 2024, total loans were $17.34 billion, an increase of $490.4 million from December 31, 2023.

The increase in the average loan balance during the first nine months of 2024 when compared to the same period in 2023 is primarily due to the continued widespread organic loan growth throughout our geographic markets over the comparative period.

Our loan portfolio averaged $16.92 billion and $16.90 billion during the first three months of 2025 and 2024, respectively.

As of March 31, 2025, total loans were $17.09 billion, an increase of $88.1 million from December 31, 2024.

The increase in the loan balance during the first three months of 2025 when compared to December 31, 2024 is primarily due to growth in the commercial real estate and mortgage warehouse portfolios over the comparative period, while we continued to focus on maintaining prudent underwriting standards and pricing discipline.

The most significant components of the loan portfolio were loans to businesses (commercial loans, commercial real estate loans and agricultural loans) and individuals (consumer loans, credit card loans and single-family residential real estate loans).

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Loan Portfolio

September 30, December 31,

March 31, December 31,

(In thousands) 2025 2024

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Consumer loans consist of credit card loans and other consumer loans.

Consumer loans were $291.6 million at September 30, 2024, or 1.7% of total loans, compared to $318.7 million, or 1.9% of total loans at December 31, 2023.

The decrease in consumer loans from December 31, 2023, to September 30, 2024, was primarily due to loan payoffs and pay downs within the credit card and other consumer portfolios during the period.

Consumer loans were $276.9 million at March 31, 2025, or 1.6% of total loans, compared to $309.0 million, or 1.8% of total loans at December 31, 2024.

The decrease in consumer loans from December 31, 2024, to March 31, 2025, was primarily due to loan payoffs and pay downs within the other consumer portfolio during the period.

Real estate loans consist of construction and development loans (“C&D”) loans, single-family residential loans and commercial real estate (“CRE”) loans.

Real estate loans were $13.51 billion at September 30, 2024, or 78.0% of total loans, compared to $13.34 billion, or 79.2%, of total loans at December 31, 2023, an increase of $175.3 million, or 1.3%.

Our C&D loans decreased by $347.8 million, or 11.1%, single family residential loans increased by $83.1 million, or 3.1%, and CRE loans increased by $440.0 million, or 5.8%.

The changes among our real estate portfolio reflected our focus on maintaining conservative underwriting standards and structure guidelines while emphasizing prudent pricing discipline during the first nine months of 2024.

Real estate loans were $13.48 billion at March 31, 2025, or 78.8% of total loans, compared to $13.39 billion, or 78.7%, of total loans at December 31, 2024, an increase of $85.5 million, or 0.6%.

Our C&D loans decreased by $11.0 million, or 0.4%, single family residential loans decreased by $42.5 million, or 1.6%, and CRE loans increased by $139.0 million, or 1.8%.

We expect to continue to manage our C&D and CRE portfolio concentration by developing deeper relationships with our customers.

Commercial loans consist of non-real estate loans related to business and agricultural loans.

Total commercial loans were $2.78 billion at September 30, 2024, or 16.0% of total loans, compared to $2.72 billion, or 16.2% of total loans at December 31, 2023, an increase of $58.8 million, or 2.2%.

The increase in commercial loans was related to the increase in agricultural loans of $81.6 million, or 35.1%, primarily due to seasonality of the portfolio, which normally peaks in the third quarter.

Total commercial loans were $2.64 billion at March 31, 2025, or 15.4% of total loans, compared to $2.70 billion, or 15.8% of total loans at December 31, 2024, a decrease of $58.2 million, or 2.2% related to loan payoffs and pay downs during the period.

Agricultural loans remained relatively flat with an increase of $3.3 million, or 1.3%.

Other loans mainly consist of mortgage warehouse lending and municipal loans.

Mortgage volume experienced an increase in demand during the first nine months of 2024 as compared to December 31, 2023, and was coupled with continued organic growth in our municipal loans during the quarter, leading to an increase of $283.3 million in other loans.

While loan growth was widespread throughout our geographic markets and was generally broad-based by loan type during the first nine months of 2024, loan growth during the first nine months of 2024 reflected moderating demand and increased payoff activity, as we focus on maintaining disciplined pricing and conservative underwriting standards given the current economic environment.

Our commercial loan pipeline consisting of all commercial loan opportunities was $1.24 billion at September 30, 2024 compared to $948.2 million at December 31, 2023.

Mortgage volume experienced an increase in demand during the first three months of 2025 as compared to December 31, 2024, leading to an increase of $93.0 million in other loans.

Our commercial loan pipeline consisting of all commercial loan opportunities was $1.81 billion at March 31, 2025 compared to $1.26 billion at December 31, 2024.

Loans approved and ready to close at the end of the quarter totaled $756.8 million.

ASSET QUALITY

Non-performing loans are comprised of (a) nonaccrual loans, (b) loans that are contractually past due 90 days and (c) other loans for which terms have been restructured to provide a reduction or deferral of interest or principal, because of deterioration in the financial position of the borrower.

Nonperforming loans are comprised of (a) nonaccrual loans, (b) loans that are contractually past due 90 days and (c) other loans for which terms have been restructured to provide a reduction or deferral of interest or principal, because of deterioration in the financial position of the borrower.

Simmons Bank recognizes income principally on the accrual basis of accounting.

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The credit card recovery group pursues account holders until it is determined, on a case-by-case basis, to be uncollectible.

Total non-performing assets increased $14.0 million from December 31, 2023 to September 30, 2024.

Nonaccrual loans increased by $17.5 million from December 31, 2023 and foreclosed assets held for sale and other real estate owned decreased $2.8 million as compared to December 31, 2023.

The increase in nonaccrual assets was primarily due to two large loans being placed in nonaccrual status during the period.

One is a $3.9 million non-owner occupied real estate construction loan and the other is a $6.6 million non-owner occupied real estate loan to a business that was negatively impacted by the COVID-19 pandemic.

Total nonperforming assets increased $41.1 million from December 31, 2024 to March 31, 2025.

Nonaccrual loans increased by $41.7 million from December 31, 2024 and foreclosed assets held for sale and other real estate owned decreased $294,000 as compared to December 31, 2024.

The increase in nonaccrual loans was primarily due to two specific credit relationships being placed on nonaccrual status during the period.

One relationship totaling $26.9 million relates to a downtown St.

Louis hotel that was originated pre-pandemic and has been on our classified list since April of 2021.

This is the only credit relationship within our portfolio located in downtown St.

The other relationship totaling $22.9 million relates to a fast-food operator and has been on our classified list since June of 2024 due to sector-related headwinds and global cash flow concerns with the borrower.

From time to time, certain borrowers experience declines in income and cash flow.

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We primarily use interest rate reduction and/or payment modifications or extensions, with an occasional forgiveness of principal.

There were three loan modifications granted to borrowers experiencing financial difficulty during the nine month period ended September 30, 2024.

Such modifications included interest rate reductions and had a total period-end amortized cost basis of $795,000 at September 30, 2024.

We continue to maintain good asset quality compared to the industry and strong asset quality remains a primary focus of our strategy.

The allowance for credit losses as a percent of total loans was 1.35% as of September 30, 2024.

Non-performing loans equaled 0.59% of total loans.

Non-performing assets were 0.38% of total assets, a 5 basis point increase from December 31, 2023.

The allowance for credit losses was 229% of non-performing loans.

Our annualized net charge-offs to average total loans ratio for the first nine months of 2024 was 0.20%.

Annualized net credit card charge-offs to average total credit card loans were 2.87% for the first nine months of 2024, compared to 2.20% during the full year 2023, and 186 basis points better than the most recently published industry average charge-off ratio as reported by the Federal Reserve for all banks.

Table 8 presents information concerning non-performing assets, including nonaccrual loans at amortized cost and foreclosed assets held for sale.

Non-performing Assets

September 30, December 31, September 30,

There were four loan modifications granted to borrowers experiencing financial difficulty during the three month period ended March 31, 2025.

Such modifications included interest rate reductions and had a total period-end amortized cost basis of $451,000 at March 31, 2025.

The allowance for credit losses as a percent of total loans was 1.48% as of March 31, 2025.

Nonperforming loans equaled 0.89% of total loans.

Nonperforming assets were 0.61% of total assets, a 16 basis point increase from December 31, 2024.

The allowance for credit losses was 165% of nonperforming loans.

Our annualized net charge-offs to average total loans ratio for the first three months of 2025 was 0.23%.

Annualized net credit card charge-offs to average total credit card loans were 2.72% for the first three months of 2025, compared to 2.93% during the full year 2024, and 176 basis points better than the most recently published industry average charge-off ratio as reported by the Federal Reserve for all banks.

Table 8 presents information concerning nonperforming assets, including nonaccrual loans at amortized cost and foreclosed assets held for sale.

Nonperforming Assets

March 31, December 31, March 31,

(Dollars in thousands) 2025 2024 2024

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Loans past due 90 days or more (principal or interest payments) 494 603 1,527

Total non-performing loans 101,695 84,472 81,941

Other non-performing assets:

Total nonperforming loans 152,391 110,757 107,315

Other nonperforming assets:

Foreclosed assets held for sale and other real estate owned 8,976 9,270 3,511

Other non-performing assets 1,311 1,726 1,417

Total other non-performing assets 2,610 5,799 5,226

Total non-performing assets $ 104,305 $ 90,271 $ 87,167

Allowance for credit losses to non-performing loans 229 % 267 % 267 %

Non-performing loans to total loans 0.59 % 0.50 % 0.49 %

Non-performing assets to total assets 0.38 % 0.33 % 0.32 %

Other nonperforming assets 978 1,202 1,491

Total other nonperforming assets 9,954 10,472 5,002

Total nonperforming assets $ 162,345 $ 121,229 $ 112,317

Allowance for credit losses to nonperforming loans 165 % 212 % 212 %

Nonperforming loans to total loans 0.89 % 0.65 % 0.63 %

Nonperforming assets to total assets 0.61 % 0.45 % 0.41 %

_______________________________________

(1) Includes nonaccrual FDMs of approximately $818,000 and $282,000 at September 30, 2024 and December 31, 2023, respectively.

The interest income on nonaccrual loans is not considered material for the three and nine month periods ended September 30, 2024 and 2023.

(1) Includes nonaccrual FDMs of approximately $28.2 million and $597,000 at March 31, 2025 and December 31, 2024, respectively.

The interest income on nonaccrual loans is not considered material for the three month periods ended March 31, 2025 and 2024.

ALLOWANCE FOR CREDIT LOSSES

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Provision for credit losses 26,797 10,206

Balance, September 30, $ 233,223 $ 218,547

Balance, March 31, $ 252,168 $ 227,367

Loans charged off:

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Provision for Credit Losses

The amount of provision added to or released from the allowance during the three and nine months ended September 30, 2024 and 2023, and for the year ended December 31, 2023, was based on management’s judgment, with consideration given to the composition and asset quality of the portfolio, historical loan loss experience, and assessment of current and expected economic forecasts and conditions.

The amount of provision added to or released from the allowance during the three months ended March 31, 2025 and 2024, and for the year ended December 31, 2024, was based on management’s judgment, with consideration given to the composition and asset quality of the portfolio, historical loan loss experience, and assessment of current and expected economic forecasts and conditions.

It is management’s practice to review the allowance on a monthly basis, and after considering the factors previously noted, to determine the level of provision made to the allowance.

Allowance for Credit Losses Allocation

As of September 30, 2024, the allowance for credit losses reflected an increase of approximately $8.0 million from December 31, 2023, while total loans increased by $490.4 million over the same nine month period.

As of March 31, 2025, the allowance for credit losses reflected an increase of approximately $17.1 million from December 31, 2024, while total loans increased by $88.1 million over the same three month period.

The allocation in each category within the allowance generally reflects the overall changes in the loan portfolio mix.

The increase in the allowance for credit losses during the first nine months of 2024 was primarily due to the loan growth experienced during the first three quarters of the year, as well as refreshed economic forecasts.

Our allowance for credit losses at September 30, 2024 was considered appropriate given the current economic environment and other related factors.

The increase in the allowance for credit losses during the first three months of 2025 was primarily due to a provision expense of $15.6 million related to two specific credit relationships which migrated to nonperforming during the period, as well as the impact of updated economic forecasts.

Our allowance for credit losses at March 31, 2025 was considered appropriate given the current economic environment and other related factors.

The following table sets forth the sum of the amounts of the allowance for credit losses attributable to individual loans within each category, or loan categories in general.

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Allocation of Allowance for Credit Losses

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

(Dollars in thousands) Allowance

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(1) Percentage of loans in each category to total loans.

Deposits are our primary source of funding for earning assets and are primarily developed through our network of 234 financial centers as of September 30, 2024.

Deposits are our primary source of funding for earning assets and are primarily developed through our network of 222 financial centers as of March 31, 2025.

We offer a variety of products designed to attract and retain customers with a continuing focus on developing core deposits.

Our core deposits consist of all deposits excluding time deposits of $250,000 or more and brokered deposits.

As of September 30, 2024, core deposits comprised 77.2% of our total deposits.

As of March 31, 2025, core deposits comprised 79.5% of our total deposits.

We continually monitor the funding requirements along with competitive interest rates in the markets we serve.

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We are continually monitoring and looking for opportunities to fairly reprice our deposits while remaining competitive in this current challenging rate environment.

Our total deposits as of September 30, 2024, were $21.94 billion, compared to $22.24 billion as of December 31, 2023.

Noninterest bearing transaction accounts, interest bearing transaction accounts and savings accounts totaled $15.39 billion at September 30, 2024, compared to $15.80 billion at December 31, 2023, a decrease of $412.6 million.

Total time deposits increased $103.1 million to $6.55 billion at September 30, 2024, from $6.45 billion at December 31, 2023.

We had $3.36 billion and $2.90 billion of brokered deposits at September 30, 2024, and December 31, 2023, respectively.

Our total deposits as of March 31, 2025, were $21.68 billion, compared to $21.89 billion as of December 31, 2024.

Noninterest bearing transaction accounts, interest bearing transaction accounts and savings accounts totaled $15.72 billion at March 31, 2025, compared to $15.44 billion at December 31, 2024, an increase of $278.3 million.

Total time deposits decreased $479.4 million to $5.96 billion at March 31, 2025, from $6.44 billion at December 31, 2024.

We had $2.91 billion and $3.30 billion of brokered deposits at March 31, 2025, and December 31, 2024, respectively.

We are continuing to refine our product offerings to give customers flexibility of choice while maintaining the ability to adjust interest rates timely in the current rate environment.

OTHER BORROWINGS AND SUBORDINATED NOTES AND DEBENTURES

Our total debt was $1.41 billion and $1.34 billion at September 30, 2024 and December 31, 2023, respectively.

The outstanding balance for September 30, 2024 includes $1.03 billion in FHLB advances;

Our total debt was $1.25 billion and $1.11 billion at March 31, 2025 and December 31, 2024, respectively.

The outstanding balance for March 31, 2025 includes $867.9 million in FHLB advances;

$366.3 million in subordinated notes and unamortized debt issuance costs;

and $17.0 million of other long-term debt.

FHLB advances outstanding at September 30, 2024 are primarily fixed rate, fixed term advances, which are due less than one year from origination and therefore are classified as short-term advances.

FHLB advances outstanding at March 31, 2025 are whole loan advances, which are due less than one year from origination and therefore are classified as short-term advances.

In March 2018, we issued $330.0 million in aggregate principal amount of 5.00% Fixed-to-Floating Rate Subordinated Notes (“Notes”) at a public offering price equal to 100% of the aggregate principal amount of the Notes.

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For information about the regulatory capital treatment of the Notes and the Spirit Notes, see the section “ Capital—Risk-Based Capital .”

At September 30, 2024, total capital was $3.53 billion.

At March 31, 2025, total capital was $3.53 billion.

Capital represents shareholder ownership in the Company – the book value of assets in excess of liabilities.

At September 30, 2024, our common equity to asset ratio was 12.94% compared to 12.53% at year-end 2023.

At March 31, 2025, our common equity to asset ratio was 13.18% compared to 13.13% at year-end 2024.

Capital Stock

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On April 27, 2022, our shareholders approved an amendment to our Articles of Incorporation to remove the classification and designation for the Series D Preferred Stock.

As of September 30, 2024 and December 31, 2023, there were no shares of preferred stock issued or outstanding.

As of March 31, 2025 and December 31, 2024, there were no shares of preferred stock issued or outstanding.

On May 17, 2024, we filed a shelf registration with the SEC.

The shelf registration statement provides increased flexibility and more efficient access to raise capital from time to time through the sale of common stock, preferred stock, debt securities, depository shares, warrants, purchase contracts, subscription rights, units or a combination thereof, subject to market conditions.

Specific terms and prices are determined at the time of any offering under a separate prospectus supplement that we are required to file with the SEC at the time of the specific offering.

Stock Repurchase Program

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Because the 2022 Program was set to terminate on January 31, 2024, our Board of Directors authorized a new stock repurchase program in January 2024 (“2024 Program”) under which we may repurchase up to $175.0 million of our Class A common stock currently issued and outstanding.

The 2024 Program will be executed in accordance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended (“Exchange Act”) and will terminate on January 31, 2026 (unless terminated sooner).

The 2024 Program, which replaced the 2022 Program, will be executed in accordance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended (“Exchange Act”) and will terminate on January 31, 2026 (unless terminated sooner).

Under the 2024 Program, we may repurchase shares of our common stock through open market and privately negotiated transactions or otherwise.

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We anticipate funding for this 2024 Program to come from available sources of liquidity, including cash on hand and future cash flow.

No shares were repurchased during the three and nine month periods ended September 30, 2024.

During the three and nine month periods ended September 30, 2023, we repurchased 1,128,962 shares at an average price of $17.69 and 2,257,049 shares at an average price per share of $17.72 under the 2022 Program.

No shares were repurchased during the three month periods ended March 31, 2025 and 2024.

Market conditions and the Company’s capital needs, among other things, will drive decisions regarding additional, future stock repurchases.

Cash Dividends

We declared cash dividends on our common stock of $0.63 per share for the first nine months of 2024 compared to $0.60 per share for the first nine months of 2023, an increase of $0.03, or 5%.

We declared cash dividends on our common stock of $0.2125 per share for the first three months of 2025 compared to $0.21 per share for the first three months of 2024, an increase of $0.0025, or 1%.

The timing and amount of future dividends are at the discretion of our Board of Directors and will depend upon our consolidated earnings, financial condition, liquidity and capital requirements, the amount of cash dividends paid to us by our subsidiaries, applicable government regulations and policies and other factors considered relevant by our Board of Directors.

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Quantitative measures established by regulation to ensure capital adequacy require us to maintain minimum amounts and ratios (set forth in the table below) of total, Tier 1 and common equity Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined) and of Tier 1 capital (as defined) to average assets (as defined).

Management believes that, as of September 30, 2024, we meet all capital adequacy requirements to which we are subject.

Management believes that, as of March 31, 2025, we meet all capital adequacy requirements to which we are subject.

As of the most recent notification from regulatory agencies, Simmons Bank was well capitalized under the regulatory framework for prompt corrective action.

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There are no conditions or events since that notification that management believes have changed the institution’s categories.

The Company’s risk-based capital ratios at September 30, 2024 and December 31, 2023 are presented in Table 11 below:

The Company’s risk-based capital ratios at March 31, 2025 and December 31, 2024 are presented in Table 11 below:

Risk-Based Capital

September 30, December 31,

March 31, December 31,

(Dollars in thousands) 2025 2024

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The rules also raised the minimum ratio of Tier 1 capital to risk-weighted assets to 6.0% and require a minimum leverage ratio of 4.0%.

Prior to December 31, 2017, Tier 1 capital included common equity Tier 1 capital and certain additional Tier 1 items as provided under the Basel III Capital Rules.

Qualifying subordinated debt of $234.3 million and $300.1 million is included as Tier 2 and total capital of the Company as of September 30, 2024 and December 31, 2023, respectively.

Qualifying subordinated debt of $234.3 million is included as Tier 2 and total capital of the Company for both periods ended March 31, 2025 and December 31, 2024.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

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Certain statements contained in this quarterly report may not be based on historical facts and should be considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.

These forward-looking statements may be identified by reference to a future period(s) or by the use of forward-looking terminology, such as “anticipate,” “believe,” “budget,” “contemplate,” “continue,” “estimate,” “expect,” “foresee,” “intend,” “indicate,” “target,” “plan,” positions,” “prospects,” “project,” “predict,” or “potential,” by future conditional verbs such as “could,” “may,” “might,” “should,” “will,” or “would,” or by variations of such words or by similar expressions.

These forward-looking statements include, without limitation, those relating to the Company’s future growth, completed acquisitions, revenue, expenses, assets, asset quality, profitability, earnings, accretion, dividends, customer service, lending capacity and lending activity, investment in digital channels, critical accounting policies and estimates, net interest margin, noninterest revenue, noninterest expense, market conditions related to and the impact of the Company’s stock repurchase program, consumer behavior and liquidity, the adequacy of the allowance for credit losses, income tax deductions, credit quality, the level of credit losses from lending commitments, net interest revenue, interest rate sensitivity, repricing of loans and time deposits, loan loss experience, liquidity, the Company’s expectations regarding actions by the FHLB and other agencies, capital resources, market risk, plans for future and current investments in securities and investment portfolio strategies, effect of pending and future litigation, staffing initiatives, estimated cost savings associated with the Company’s early retirement program and Better Bank Initiative, acquisition strategy and activity, legal and regulatory limitations and compliance and competition.

These forward-looking statements may be identified by reference to a future period(s) or by the use of forward-looking terminology, such as “anticipate,” “believe,” “budget,” “contemplate,” “continue,” “estimate,” “expect,” “foresee,” “intend,” “indicate,” “likely,” “target,” “plan,” “positions,” “prospects,” “project,” “predict,” or “potential,” by future conditional verbs such as “could,” “may,” “might,” “should,” “will,” or “would,” or by variations of such words or by similar expressions.

These forward-looking statements include, without limitation, those relating to the Company’s future growth, business strategies, product development, acquisitions and their expected benefits, revenue, expenses, assets, asset quality, profitability, earnings, accretion, dividends, customer service, lending capacity and lending activity, loan demand, deposit levels, investment in digital channels, critical accounting policies and estimates, net interest income, net interest margin, noninterest income, noninterest expense, the Company’s stock repurchase program, consumer behavior and liquidity, the Company’s ability to recruit and retain key employees, the adequacy of the allowance for credit losses, the estimated cost savings associated with the Company’s Better Bank Initiative, income tax deductions, credit quality, the level of credit losses from lending commitments, net interest revenue, interest rates and interest rate sensitivity (including, among other things, the impact of rising or declining interest rates), economic conditions, repricing of loans and time deposits, loan loss experience, liquidity, the Company’s expectations regarding actions by the FHLB and other agencies, capital resources, the expected expenses and cost savings associated with branch closures, market risk, plans for investments in (and cash flows from) securities and investment portfolio strategies, effect of pending and future litigation, staffing initiatives, estimated cost savings associated with the Company’s early retirement program and Better Bank Initiative, legal and regulatory limitations and compliance and competition.

These forward-looking statements are based on various assumptions and involve inherent risks and uncertainties, and may not be realized due to a variety of factors, including, without limitation:

changes in the Company’s operating, acquisition, or expansion strategy;

the effects of future economic conditions (including unemployment levels and slowdowns in economic growth), governmental monetary and fiscal policies, including policies of the Federal Reserve, as well as legislative and regulatory changes;

the effects of future economic conditions (including unemployment levels and slowdowns in economic growth), governmental monetary and fiscal policies (including the policies of the Federal Reserve, as well as legislative and regulatory changes);

changes in tariff policies;

general business conditions, as well as conditions within the financial markets, developments impacting the financial services industry, such as bank failures or concerns involving liquidity;

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changes in interest rates and related governmental policies;

changes in liquidity;

changes in the level and composition of deposits, loan demand, deposit flows, credit quality and the values of loan collateral, securities and interest sensitive assets and liabilities;

changes in liquidity, and the availability of and costs associated with obtaining adequate and timely sources of liquidity;

increased inflation;

changes in the level and composition of deposits, loan demand, deposit flows, and the values of loan collateral, securities and interest sensitive assets and liabilities;

changes in credit quality;

actions taken by the Company to manage its investment securities portfolio;

changes in the securities markets generally or the price of the Company’s common stock;

changes in the securities markets generally or the price of the Company’s common stock, specifically;

changes in the assumptions used in making the forward-looking statements;

developments in information technology affecting the financial industry;

changes in customer behaviors, including consumer spending, borrowing and saving habits;

cyber threats, attacks or events, including at third-parties with which we rely on for key services;

cyber threats, attacks or events, including at third parties on which we rely for key services;

the ability to collect amounts due under loan agreements;

reliance on third parties for the provision of key services;

further changes in accounting principles relating to loan loss recognition (current expected credit losses);

further changes in accounting principles relating to loan loss recognition;

the costs of evaluating possible acquisitions and the risks inherent in integrating acquisitions;

possible adverse rulings, judgements, settlements, fines and other outcomes of pending or future litigation or government actions;

market disruptions, including pandemics or significant health hazards, severe weather conditions, natural disasters, terrorist activities, financial crises, political crises, war and other military conflicts (including the ongoing military conflict between Russia and Ukraine and between Israel and Hamas) or other major events, or the prospect of these events;

market disruptions, including pandemics or significant health hazards, severe weather conditions, natural disasters, terrorist activities, financial crises, political crises, war and other military conflicts (including the ongoing military conflicts between Russia and Ukraine) or other major events, or the prospect of these events;

changes in customer behaviors and preferences, including consumer spending, borrowing and saving habits;

the soundness of other financial institutions and indirect exposure related to the closings of other financial institutions and their impact on the broader market through other customers, suppliers and partners (or that the conditions which resulted in the liquidity concerns that led to the large regional bank failures during 2023 may also adversely impact, directly or indirectly, other financial institutions and market participants with which the Company has commercial or deposit relationships);

the loss of key employees;

fraud that results in material losses or that we have not discovered yet that may result in material losses;

increased unemployment;

labor shortages;

the Company’s ability to manage and successfully integrate its mergers and acquisitions and to fully realize cost savings and other benefits associated with those transactions;

the Company’s ability to manage and successfully integrate its mergers and acquisitions to fully realize cost savings and other benefits associated with those transactions;

increased delinquency and foreclosure rates on commercial real estate and other loans;

significant increases in nonaccrual loan balances;

the effects of government legislation;

the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds, and other financial institutions operating in our market area and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, cell-phone/tablet, telephone, computer and the Internet;

the failure of assumptions underlying the establishment of reserves for possible credit losses, fair value for loans, OREO, and other cautionary statements set forth elsewhere in this report.

the failure of assumptions underlying the establishment of reserves for possible credit losses, fair value for loans, other real estate owned and other cautionary statements set forth elsewhere in this report.

Additional information on factors that might cause the Company’s results to differ materially from those disclosed in the forward-looking statements is included in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of this quarterly report, the Company’s annual report on Form 10-K for the year ended December 31, 2024, and related disclosures in other filings with the SEC, which are available on the SEC’s website at www.sec.gov.

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GAAP RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

The tables below present computations of adjusted earnings (net income excluding certain items {net branch right sizing costs, merger related costs, FDIC special assessment, loss (gain) on sale of securities, termination of vendor and software services, early retirement program costs and tax effect}) (non-GAAP), and adjusted diluted earnings per share (non-GAAP) as well as a computation of tangible book value per share (non-GAAP), tangible common equity to tangible assets (non-GAAP), adjusted noninterest income (non-GAAP), adjusted noninterest expense (non-GAAP), adjusted salaries and employee benefits expense (non-GAAP), uninsured, non-collateralized deposits (non-GAAP) and the coverage ratio of uninsured, non-collateralized deposits (non-GAAP).

The tables below present computations of adjusted earnings (net income excluding certain items {net branch right sizing costs, FDIC special assessment, early retirement program costs and tax effect}) (non-GAAP), and adjusted diluted earnings per share (non-GAAP) as well as a computation of tangible book value per share (non-GAAP), tangible common equity to tangible assets (non-GAAP), adjusted noninterest expense (non-GAAP), uninsured, non-collateralized deposits (non-GAAP) and the coverage ratio of uninsured, non-collateralized deposits (non-GAAP).

Adjusted items are included in financial results presented in accordance with generally accepted accounting principles (US GAAP).

The Company has updated its calculation of certain non-GAAP financial measures to exclude the impact of gains or losses on the sale of AFS investment securities in light of the impact of the Company’s strategic AFS investment securities transactions during the fourth quarter of 2023 and has presented past periods on a comparable basis.

We believe the exclusion of these certain items in expressing earnings and certain other financial measures, including “adjusted earnings,” provides a meaningful basis for period-to-period and company-to-company comparisons, which management believes will assist investors and analysts in analyzing the adjusted financial measures of the Company and predicting future performance.

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• Investor presentations of Company performance

We have $1.422 billion and $1.433 billion total goodwill and other intangible assets for the periods ended September 30, 2024 and December 31, 2023, respectively.

We have $1.415 billion and $1.418 billion total goodwill and other intangible assets for the periods ended March 31, 2025 and December 31, 2024, respectively.

Because our acquisition strategy has resulted in a high level of intangible assets, management believes useful calculations include tangible book value per share (non-GAAP) and tangible common equity to tangible assets (non-GAAP).

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Reconciliation of Adjusted Earnings (non-GAAP)

Three Months Ended Nine Months Ended

September 30, June 30, September 30, September 30,

Three Months Ended

March 31, December 31, March 31,

(In thousands, except per share data) 2025 2024 2024

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FDIC Special Assessment — — 1,549

Merger related costs — — — 1,420

Early retirement program — 200 219

Termination of vendor and software services (13) 615 602 —

Loss on sale of securities 28,393 — 28,393 391

Branch right sizing (net) 994 1,581 236

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FDIC Special Assessment — — 0.01

Merger related costs — — — 0.01

Early retirement program — — —

Termination of vendor and software services — 0.01 — —

Loss on sale of securities 0.23 — 0.23 —

Branch right sizing (net) — 0.01 —

Tax effect (1)

(0.06) — (0.07) (0.02)

Certain items, net of tax — 0.01 0.01

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(2) See Note 15, Earnings Per Share (“EPS”), for number of shares used to determine EPS.

See Table 13 below for the reconciliations of adjusted noninterest income, adjusted noninterest expense and adjusted salaries and employee benefits expense for the periods presented.

Reconciliations of Adjusted Noninterest Income (non-GAAP), Adjusted Noninterest Expense (non-GAAP) and Adjusted Salaries and Employee Benefits Expense (non-GAAP)

Three Months Ended Nine Months Ended

September 30, June 30, September 30, September 30,

See Table 13 below for the reconciliation of adjusted noninterest expense for the periods presented.

Reconciliation of Adjusted Noninterest Expense (non-GAAP)

Three Months Ended

March 31, December 31, March 31,

(In thousands) 2025 2024 2024

Noninterest income $ 17,130 $ 43,299 $ 103,613 $ 133,592

Certain items:

Loss on sale of securities 28,393 — 28,393 391

Total certain items 28,393 — 28,393 391

Adjusted noninterest income (non-GAAP) $ 45,523 $ 43,299 $ 132,006 $ 133,983

Noninterest expense $ 144,580 $ 141,117 $ 139,879

Certain items:

Merger related costs — — — (1,420)

Early retirement program — (200) (219)

Termination of vendor and software services 13 (615) (602) —

FDIC Special Assessment — — (1,549)

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Adjusted noninterest expense (non-GAAP) $ 143,586 $ 139,336 $ 137,875

Salaries and employee benefits expense $ 69,167 $ 70,716 $ 212,536 $ 219,135

Early retirement program 1 (118) (336) (5,166)

Other (1) 1 — —

Adjusted salaries and employee benefits expense (non-GAAP) $ 69,167 $ 70,599 $ 212,200 $ 213,969

See Table 14 below for the reconciliation of tangible book value per common share.

Reconciliation of Tangible Book Value per Common Share (non-GAAP)

September 30, December 31,

March 31, December 31,

(In thousands, except per share data) 2025 2024

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Reconciliation of Tangible Common Equity and the Ratio of Tangible Common Equity to Tangible Assets (non-GAAP)

September 30, December 31,

March 31, December 31,

(Dollars in thousands) 2025 2024

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Reconciliation of Uninsured, Non-Collateralized Deposits and the Calculation of Uninsured, Non-Collateralized Deposit Coverage Ratio (non-GAAP)

September 30, December 31,

March 31, December 31,

(In thousands) 2025 2024

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis