What changed in this filing

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Item 1. Financial Statements

2025-11-04 compared with 2025-08-07 · 180 added, 169 removed, 949 unchanged (27% of the section changed)

2 unchanged sentences

CONSOLIDATED BALANCE SHEETS

($ in thousands, except per share data) June 30, 2025 December 31, 2024

($ in thousands, except per share data) September 30, 2025 December 31, 2024

ASSETS (Unaudited)

3 unchanged sentences

Investment securities:

Available for sale, at fair value (amortized cost of $ 195,389 and $ 159,593 at June 30, 2025 and December 31, 2024, respectively)

Available for sale, at fair value (amortized cost of $ 188,267 and $ 159,593 at September 30, 2025 and December 31, 2024, respectively)

181,720 149,212

Held to maturity, net of allowance for credit losses of $ 199 and $ 203 (fair value of $ 414,699 and $ 424,734 at June 30, 2025 and December 31, 2024, respectively)

Held to maturity, net of allowance for credit losses of $ 95 and $ 203 (fair value of $ 393,540 and $ 424,734 at September 30, 2025 and December 31, 2024, respectively)

433,440 481,077

32 unchanged sentences

shares authorized 50,000,000 ;

shares issued and outstanding 33,374,265 and 33,332,177 at June 30, 2025 and December 31, 2024, respectively

shares issued and outstanding 33,421,672 and 33,332,177 at September 30, 2025 and December 31, 2024, respectively

Additional paid in capital 359,939 358,112

6 unchanged sentences

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

($ in thousands, except per share data) 2025 2024 2025 2024

16 unchanged sentences

Trust and investment fee income 898 880 2,663 2,510

Gain on sale of loans held for sale 1,325 1,131 2,291 1,838

Mortgage banking revenue 1,278 1,177 4,897 3,961

23 unchanged sentences

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

($ in thousands) 2025 2024 2025 2024

Net income $ 14,348 $ 11,189 $ 43,619 $ 30,607

Other comprehensive income (loss):

Other comprehensive income:

Investment securities:

Unrealized holding gains (losses) on available for sale securities 1,004 ( 278 ) 2,671 ( 1,054 )

Unrealized holding gains on available for sale securities 1,163 3,762 3,834 2,708

Tax effect ( 319 ) ( 1,028 ) ( 1,048 ) ( 740 )

Total other comprehensive income (loss) 730 ( 202 ) 1,942 ( 766 )

Total other comprehensive income 844 2,734 2,786 1,968

Comprehensive income $ 15,192 $ 13,923 $ 46,405 $ 32,575

14 unchanged sentences

Balances, June 30, 2025 $ 334 $ 359,063 $ 211,400 $ ( 5,603 ) $ 565,194

Net income — — 14,348 — 14,348

Other comprehensive income — — — 844 844

Stock-based compensation — 876 — — 876

Cash dividends declared — — ( 4,055 ) — ( 4,055 )

Balances, September 30, 2025 $ 334 $ 359,939 $ 221,693 $ ( 4,759 ) $ 577,207

See accompanying notes to unaudited consolidated financial statements.

SHORE BANCSHARES, INC.

15 unchanged sentences

Balances, June 30, 2024 $ 333 $ 356,994 $ 173,716 $ ( 8,260 ) $ 522,783

Net income — — 11,189 — 11,189

Other comprehensive income — — — 2,734 2,734

Common shares issued for employee stock purchase plan — 98 — — 98

Stock-based compensation — 488 — — 488

Cash dividends declared — — ( 4,021 ) — ( 4,021 )

Balances, September 30, 2024 $ 333 $ 357,580 $ 180,884 $ ( 5,526 ) $ 533,271

See accompanying notes to unaudited consolidated financial statements.

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

Six Months Ended June 30,

Nine Months Ended September 30,

($ in thousands) 2025 2024

12 unchanged sentences

Stock-based compensation expense 1,357 1,252

Deferred income tax (benefit) expense 156 4,916

Deferred income tax expense 482 7,776

Loss on sales of repossessed assets 164 375

Loss on valuation adjustments on mortgage servicing rights 330 129

Loss (gain) on valuation adjustments on mortgage servicing rights 691 ( 253 )

Loss on disposal of fixed assets 147 10

1 unchanged sentence

Valuation adjustments on premises transferred to held for sale — 2

Loss on sales and valuation adjustments on other real estate owned 59 —

Fair value adjustment on equity securities ( 163 ) ( 124 )

24 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - Continued

Six Months Ended June 30,

Nine Months Ended September 30,

($ in thousands) 2025 2024

3 unchanged sentences

Interest-bearing deposits ( 32,616 ) ( 474,828 )

Short-term borrowings — 31,000

Long-term borrowings — 50,000

11 unchanged sentences

Transfer from loans held for sale to loans held for investment 649 —

Unrealized gains (losses) on available for sale securities 2,671 ( 1,054 )

Unrealized gains on available for sale securities 3,834 2,708

Transfer of premises to held for sale, included in other assets — 1,387

12 unchanged sentences

The Company engages in the banking business through Shore United Bank, N.A.

(the “Bank”), a Maryland commercial bank with trust powers.

(the “Bank”), a national banking association with trust powers.

The Company’s primary source of revenue is derived from interest earned on commercial, residential mortgage and other loans, and fees charged in connection with lending and other banking services located in Maryland, Delaware and Virginia.

4 unchanged sentences

The Title Company ceased conducting real estate closings effective March 31, 2025.

Operations will continue for as long as necessary to ensure that work in progress is adequately addressed.

Use of Estimates

17 unchanged sentences

Note 2 – Investment Securities

The following tables provide information on the amortized cost and estimated fair values of investment securities at June 30, 2025 and December 31, 2024.

The following tables provide information on the amortized cost and estimated fair values of investment securities at September 30, 2025 and December 31, 2024.

($ in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value

Available for sale securities (1) :

June 30, 2025

September 30, 2025

Treasury and government agency securities $ 22,409 $ 3 $ 1,847 $ 20,565

10 unchanged sentences

____________________________________

(1) No available for sale (“AFS”) securities were sold during the three and six months ended June 30, 2025 and 2024.

(1) No available for sale (“AFS”) securities were sold during the three and nine months ended September 30, 2025 and 2024.

(2) Other debt securities includes corporate and municipal bond obligations of state and political entities.

1 unchanged sentence

Held to maturity securities:

June 30, 2025

September 30, 2025

Treasury and government agency securities $ 114,884 $ — $ 5,200 $ 109,684 $ —

11 unchanged sentences

(1) Other debt securities includes corporate and municipal bond obligations of state and political entities.

Equity securities with aggregate fair values of $ 6.0 million and $ 5.8 million at June 30, 2025 and December 31, 2024, respectively, are presented separately on the consolidated balance sheets.

The fair value adjustments recorded through earnings totaled a gain of $ 65 thousand and $ 18 thousand for the three months ended June 30, 2025 and 2024, respectively.

The fair value adjustments recorded through earnings totaled a gain of $ 196 thousand and a loss of $ 171 thousand for the six months ended June 30, 2025 and 2024, respectively.

Equity securities with aggregate fair values of $ 6.1 million and $ 5.8 million at September 30, 2025 and December 31, 2024, respectively, are presented separately on the consolidated balance sheets.

The fair value adjustments recorded through earnings totaled a gain of $ 104 thousand and $ 79 thousand for the three months ended September 30, 2025 and 2024, respectively.

The fair value adjustments recorded through earnings totaled a gain of $ 299 thousand and $ 38 thousand for the nine months ended September 30, 2025 and 2024, respectively.

The following table summarizes the activity in the allowance for credit losses (“ACL”) on held to maturity (“HTM”) securities for the periods presented.

Three Months Ended Six Months Ended

($ in thousands) June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2024

Three Months Ended Nine Months Ended

($ in thousands) September 30, 2025 September 30, 2024 September 30, 2025 September 30, 2024

Balance, beginning of period $ 199 $ 108 $ 203 $ 94

1 unchanged sentence

Balance, end of period $ 95 $ 101 $ 95 $ 101

A provision for credit losses of $ 21 thousand and a reversal of the provision for credit losses of $ 8 thousand was recorded on HTM corporate and municipal bonds for the three months ended June 30, 2025 and 2024, respectively.

A reversal of the provision for credit losses of $ 4 thousand and a provision for credit losses of $ 14 thousand was recorded on HTM corporate and municipal bonds for the six months ended June 30, 2025 and 2024, respectively.

The following tables provide information about gross unrealized losses and fair value by length of time that the individual securities have been in a continuous unrealized loss position at June 30, 2025 and December 31, 2024.

A reversal of the provision for credit losses of $ 104 thousand and $ 7 thousand was recorded on HTM corporate and municipal bonds for the three months ended September 30, 2025 and 2024, respectively.

A reversal of the provision for credit losses of $ 108 thousand and a provision for credit losses of $ 7 thousand was recorded on HTM corporate and municipal bonds for the nine months ended September 30, 2025 and 2024, respectively.

Less than 12 Months More than 12 Months Total

($ in thousands) Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses

June 30, 2025

September 30, 2025

Available for sale securities:

1 unchanged sentence

Mortgage-backed securities 58,809 299 44,034 5,160 102,843 5,459

Other debt securities — — — — — —

Total $ 58,938 $ 300 $ 61,877 $ 7,006 $ 120,815 $ 7,306

7 unchanged sentences

Total $ 57,120 $ 710 $ 68,192 $ 10,228 $ 125,312 $ 10,938

There were 118 AFS debt securities with a fair value below the amortized cost basis, with unrealized losses totaling $ 8.3 million as of June 30, 2025.

The Company concluded that a credit loss does not exist in its AFS securities portfolio as of June 30, 2025, and no impairment loss has been recognized based on the fact that (1) changes in fair value were primarily caused by fluctuations in interest rates, (2) securities with unrealized losses had generally high credit quality, (3) the Company intends to hold these investments in debt securities to maturity and it is more-likely-than-not the Company will not be required to sell these investments before a recovery of its investment, and (4) issuers have continued to make timely payments of principal and interest.

There were 114 AFS debt securities with a fair value below the amortized cost basis, with unrealized losses totaling $ 7.3 million as of September 30, 2025.

The Company concluded that a credit loss does not exist in its AFS securities portfolio as of September 30, 2025, and no impairment loss has been recognized based on the fact that (1) changes in fair value were primarily caused by fluctuations in interest rates, (2) securities with unrealized losses had generally high credit quality, (3) the Company intends to hold these investments in debt securities to maturity and it is more likely than not the Company will not be required to sell these investments before a recovery of its investment, and (4) issuers have continued to make timely payments of principal and interest.

Additionally, the Company’s mortgage-backed securities are issued by either U.S.

3 unchanged sentences

government, that investors in such mortgage-backed securities will receive timely principal and interest payments.

All HTM and AFS securities were current with no securities past due or on nonaccrual as of June 30, 2025 and December 31, 2024.

All HTM and AFS securities were current with no securities past due or on nonaccrual as of September 30, 2025 and December 31, 2024.

All of the securities with unrealized losses in the portfolio have modest duration risk, low credit risk and minimal losses when compared to total amortized cost.

1 unchanged sentence

Because the Company does not intend to sell these securities and it is not more likely than not that the Company will be required to sell these securities before recovery of their amortized cost bases, which may be at maturity for debt securities, the Company considers the unrealized losses to be temporary.

There were 118 AFS and 181 HTM securities in an unrealized loss position at June 30, 2025.

There were 114 AFS and 173 HTM securities in an unrealized loss position at September 30, 2025.

There were 111 AFS and 187 HTM securities in an unrealized loss position at December 31, 2024.

Net unrealized losses of the AFS securities totaled $ 7.7 million and $ 10.4 million as of June 30, 2025 and December 31, 2024, respectively.

The following table provides information on the amortized cost and estimated fair values of investment securities by contractual maturity date at June 30, 2025.

Net unrealized losses of the AFS securities totaled $ 6.5 million and $ 10.4 million as of September 30, 2025 and December 31, 2024, respectively.

The following table provides information on the amortized cost and estimated fair values of investment securities by contractual maturity date at September 30, 2025.

Available for Sale Held to Maturity

10 unchanged sentences

The Company has securities that have been pledged as collateral for obligations to federal, state and local government agencies, and other purposes as required or permitted by law, or sold under agreements to repurchase.

At June 30, 2025, the aggregate carrying value of pledged AFS and HTM pledged securities was $ 69.9 million and $ 213.0 million, respectively.

At September 30, 2025, the aggregate carrying value of pledged AFS and HTM pledged securities was $ 67.6 million and $ 211.4 million, respectively.

The comparable amounts for December 31, 2024 were $ 67.9 million and $ 197.5 million, respectively.

The following table sets forth the amortized cost and estimated fair values of securities that have been pledged as collateral for obligations to federal, state and local government agencies, and other purposes as required or permitted by law, or sold under agreements to repurchase at June 30, 2025 and December 31, 2024.

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

($ in thousands) Amortized Cost Fair Value Amortized Cost Fair Value

1 unchanged sentence

Pledged held to maturity securities 211,434 191,089 197,474 173,248

There were no obligations to any issuer exceeding 10% of stockholders’ equity at June 30, 2025 or December 31, 2024.

There were no obligations of any issuer exceeding 10% of stockholders’ equity at September 30, 2025 or December 31, 2024.

Note 3 – Loans and Allowance for Credit Losses

2 unchanged sentences

of the 2024 Annual Report.

The following table provides information about the principal classes of the loan portfolio at June 30, 2025 and December 31, 2024.

($ in thousands) June 30, 2025 % of Total Loans December 31, 2024 % of Total Loans

The following table provides information about the principal classes of the loan portfolio at September 30, 2025 and December 31, 2024.

($ in thousands) September 30, 2025 % of Total Loans December 31, 2024 % of Total Loans

Commercial real estate $ 2,642,601 54.12 % $ 2,557,806 53.60 %

8 unchanged sentences

Loans are stated at their principal amount outstanding, net of any purchase premiums/discounts and deferred fees and costs.

Included in loans were deferred costs, net of fees, of $ 3.0 million and $ 3.2 million at June 30, 2025 and December 31, 2024, respectively.

At June 30, 2025 and December 31, 2024, loans included $ 1.63 billion and $ 1.69 billion, respectively, of aggregate loans that were acquired as part of the acquisitions of Severn Bancorp, Inc.

Included in loans were deferred costs, net of fees, of $ 2.9 million and $ 3.2 million at September 30, 2025 and December 31, 2024, respectively.

At September 30, 2025 and December 31, 2024, loans included $ 1.58 billion and $ 1.69 billion, respectively, of aggregate loans that were acquired as part of the acquisitions of Severn Bancorp, Inc.

(“Severn”) and The Community Financial Corporation (“TCFC”).

These balances were presented net of the related aggregate discounts, which totaled $ 86.1 million and $ 92.0 million at June 30, 2025 and December 31, 2024, respectively.

At June 30, 2025, the Bank was servicing $ 232.9 million in loans for the Federal National Mortgage Association and $ 1,337.6 million in loans for Federal Home Loan Mortgage Corporation.

The following tables provide information on amortized cost basis on nonaccrual loans by loan class as of June 30, 2025 and December 31, 2024.

balances are presented net of the related aggregate discounts, which totaled $ 82.5 million and $ 92.0 million at September 30, 2025 and December 31, 2024, respectively.

At September 30, 2025, the Bank was servicing $ 352.7 million in loans for the Federal National Mortgage Association and $ 109.1 million in loans for Federal Home Loan Mortgage Corporation.

The following tables provide information on amortized cost basis on nonaccrual loans by loan class as of September 30, 2025 and December 31, 2024.

($ in thousands) Nonaccrual With No Allowance For Credit Loss Nonaccrual With An Allowance For Credit Loss Total Nonaccrual Loans

June 30, 2025

September 30, 2025

Nonaccrual loans:

19 unchanged sentences

($ in thousands) Nonaccrual Delinquent Loans Nonaccrual Current Loans Total Nonaccrual Loans

June 30, 2025

September 30, 2025

Nonaccrual loans:

20 unchanged sentences

Consumer credit cards are monitored based on a borrower payment history.

Credit card loans are classified as performing and are typically charged off no later than 180 days past due when, or in the opinion of management, the collection of principal or interest is considered doubtful.

As of June 30, 2025, there w ere seven cred it cards that were evaluated based on economic conditions specific to the loans or borrowers, and were downgraded to substandard and nonperforming.

Credit card loans are classified as performing and are typically charged off no later than 180 days past due or when, in the opinion of management, the collection of principal or interest is considered doubtful.

As of September 30, 2025, there w ere two cred it cards that were evaluated based on economic conditions specific to the loans or borrowers, and were downgraded to substandard and nonperforming.

Loans subject to risk rating are graded on a scale of one to ten.

22 unchanged sentences

Rating 10 – Loss – Loss assets are uncollectible or of little value.

The following table provides information on loan risk ratings as of June 30, 2025 and gross write-offs during the six months ended June 30, 2025.

The following table provides information on loan risk ratings as of September 30, 2025 and gross write-offs during the nine months ended September 30, 2025.

Term Loans by Origination Year Revolving Loans Revolving Converted to Term Loans Total

($ in thousands) Prior 2021 2022 2023 2024 2025

June 30, 2025

September 30, 2025

Commercial real estate

30 unchanged sentences

Total gross charge-offs $ ( 523 ) $ ( 99 ) $ ( 1,538 ) $ ( 465 ) $ ( 314 ) $ — $ ( 92 ) $ ( 31 ) $ ( 3,062 )

The following table presents the amortized cost in credit card loans based on performing status and gross charge-off as of June 30, 2025 and gross write-offs during the six months ended June 30, 2025.

The following table presents the amortized cost in credit card loans based on performing status and gross charge-off as of September 30, 2025 and gross write-offs during the nine months ended September 30, 2025.

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

1 unchanged sentence

($ in thousands) Prior 2021 2022 2023 2024 2025

June 30, 2025

September 30, 2025

Performing $ — $ — $ — $ — $ — $ — $ 5,016 $ — $ 5,016

60 unchanged sentences

investment $ 1,195,244 $ 405,932 $ 764,538 $ 1,052,957 $ 634,525 $ 461,566 $ 239,292 $ 17,934 $ 4,771,988

The following tables provide information on the aging of the Company’s loan portfolio as of June 30, 2025 and December 31, 2024.

The following tables provide information on the aging of the Company’s loan portfolio as of September 30, 2025 and December 31, 2024.

($ in thousands) 30‑59 Days Past Due 60‑89 Days Past Due 90 Days Past Due and Still Accruing 30-89 Days Past Due and Not Accruing 90 Days Past Due and Not Accruing Total Past Due Current Accrual Loans Current Nonaccrual Loans Total

June 30, 2025

September 30, 2025

Commercial real estate $ 1,594 $ — $ — $ 2,512 $ 479 $ 4,585 $ 2,630,845 $ 7,171 $ 2,642,601

16 unchanged sentences

Percent of total loans 0.2 % 0.0 % 0.0 % 0.1 % 0.2 % 0.5 % 99.4 % 0.2 % 100.0 %

The following tables provide a summary of the activity in the ACL allocated by loan class for the three and six months ended June 30, 2025 and 2024.

The following tables provide a summary of the activity in the ACL allocated by loan class for the three and nine months ended September 30, 2025 and 2024.

Allocation of a portion of the allowance to one loan class does not preclude its availability to absorb losses from other loan classes.

($ in thousands) Beginning Balance Charge-offs Recoveries Provisions Ending Balance

Three Months Ended June 30, 2025

Three Months Ended September 30, 2025

Commercial real estate $ 21,662 $ ( 109 ) $ — $ ( 484 ) $ 21,069

6 unchanged sentences

($ in thousands) Beginning Balance Charge-offs Recoveries Provisions Ending

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Commercial real estate $ 22,984 $ — $ — $ 115 $ 23,099

7 unchanged sentences

Balance Charge-offs Recoveries Provisions Ending

Six Months Ended June 30, 2025

Nine Months Ended September 30, 2025

Commercial real estate $ 22,846 $ ( 109 ) $ 78 $ ( 1,746 ) $ 21,069

6 unchanged sentences

($ in thousands) Beginning Balance Charge-offs Recoveries Provisions Ending

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Commercial real estate $ 23,015 $ — $ — $ 84 $ 23,099

6 unchanged sentences

The following tables present the amortized cost basis of collateral-dependent loans by loan portfolio segment.

June 30, 2025

September 30, 2025

($ in thousands) Real Estate Collateral Other Collateral Total

15 unchanged sentences

Modifications to borrowers experiencing financial difficulty may include interest rate reduction, principal or interest forgiveness, forbearance, term extensions, and other combinations of actions intended to minimize economic loss and to avoid foreclosure or repossession of collateral.

During the three and six months ended June 30, 2025, nine loan modifications were made to borrowers experiencing financial difficulty.

During the three and six months ended June 30, 2024, zero loan modifications were made to borrowers experiencing financial difficulty.

During the three and six months ended June 30, 2025 and 2024, there were no defaults on loan modifications made to borrowers experiencing financial difficulty in the preceding 12 months.

As of June 30, 2025, nine loan modification balances with borrowers experiencing financial difficulty that were modified during the preceding 12 months were classified as current accrual and were for $ 6.6 million of commercial real estate loans.

During the three months ended September 30, 2025, one loan modification in the form of an interest rate reduction was made to a borrower experiencing financial difficulty.

For the nine months ended September 30, 2025, ten loan modifications in the form of interest rate reductions were made to borrowers experiencing financial difficulty.

During the three and nine months ended September 30, 2024, zero loan modifications were made to borrowers experiencing financial difficulty.

During the three and nine months ended September 30, 2025 and 2024, there were no defaults on loan modifications made to borrowers experiencing financial difficulty in the preceding 12 months.

As of September 30, 2025, ten commercial real estate loans with an aggregate balance of $ 6.8 million with borrowers experiencing financial difficulty that were modified during the preceding 12 months were classified as current accrual and current nonaccrual, of which $ 6.6 million were for commercial real estate loans, $ 177 thousand were for commercial loans and $ 33 thousand were for residential real estate loans.

Foreclosure Proceedings

There were $ 135 thousand of consumer mortgage loans collateralized by residential real estate property that were in the process of foreclosure as of June 30, 2025 and $ 124 thousand in December 31, 2024.

There were $ 93 thousand of commercial real estate loans collateralized by commercial real estate that were in the process of foreclosure as of June 30, 2025 and $ 554 thousand in December 31, 2024.

There were $ 124 thousand of consumer mortgage loans collateralized by residential real estate property that were in the process of foreclosure as of September 30, 2025 and $ 124 thousand as of December 31, 2024.

There were $ 93 thousand of commercial real estate loans collateralized by commercial real estate that were in the process of foreclosure as of September 30, 2025 and $ 554 thousand as of December 31, 2024.

Other Real Estate Owned (“OREO”) and Repossessed Assets

1 unchanged sentence

Subsequently, foreclosed assets are carried at the lower of carrying value or fair value.

The Company had OREO and repossessed asset balances of $ 179 thousand and $ 2.5 million as of June 30, 2025 and $ 179 thousand and $ 3.3 million as of December 31, 2024, respectively.

The Company had OREO and repossessed asset balances of $ 120 thousand and $ 3.4 million as of September 30, 2025 and $ 179 thousand and $ 3.3 million as of December 31, 2024, respectively.

Mortgage Servicing Rights (“MSRs”)

Mortgage loans are sold with servicing retained and the MSRs are initially recorded at fair value with the income statement effect recorded in the income statement.

Mortgage loans are sold with servicing retained and the MSRs are initially recorded at fair value with the income statement effect recorded in mortgage banking revenue in the consolidated statements of income.

Subsequently the MSRs are amortized to the income statement in proportion to, and over the period of, the estimated future net servicing income of the underlying loans.

Servicing rights are evaluated for impairment based upon fair value of the rights as compared to carrying amount.

No impairment was recognized for the six months ended June 30, 2025.

The Company recognized net servicing income of $ 168 thousand and $ 418 thousand for the three months ended June 30, 2025 and 2024, respectively.

The Company recognized net servicing income of $ 103 thousand and $ 506 thousand for the six months ended June 30, 2025 and 2024, respectively.

The following table presents activity in MSRs for the three and six months ended June 30, 2025.

No impairment was recognized for the nine months ended September 30, 2025.

The Company recognized net servicing income of $ 147 thousand and $ 425 thousand for the three months ended September 30, 2025 and 2024, respectively.

The Company recognized net servicing income of $ 251 thousand and $ 81 thousand for the nine months ended September 30, 2025 and 2024, respectively.

The following table presents activity in MSRs for the three and nine months ended September 30, 2025.

($ in thousands) Three Months Ended

June 30, 2025 Six Months Ended

June 30, 2025

September 30, 2025 Nine Months Ended

September 30, 2025

Beginning balance $ 5,396 $ 5,874

3 unchanged sentences

Ending balance $ 5,293 $ 5,293

The fair value of MSRs were determined using discount rates ranging from 9.5 % to 10.0 % at June 30, 2025 and December 31, 2024, respectively.

The valuation on MSRs was not material at June 30, 2025 and December 31, 2024.

Depending on the stratification of the specific mortgage servicing right, prepayment speeds ranged from 5.84 % to 8.48 % for the three months ended June 30, 2025 and 5.69 % to 8.22 % for the six months ended June 30, 2025.

The associated weighted-average default rates were 0.14 % for the three and six months ended June 30, 2025, respectively.

The fair value of MSRs were determined using discount rates ranging from 9.5 % to 10.0 % at September 30, 2025 and December 31, 2024, respectively.

The valuation on MSRs was not material at September 30, 2025 and December 31, 2024.

Depending on the stratification of the specific mortgage servicing right, prepayment speeds ranged from 6.08 % to 9.27 % for the three months ended September 30, 2025 and 5.69 % to 8.22 % for the nine months ended September 30, 2025.

The associated weighted-average default rates were 0.14 % for the three and nine months ended September 30, 2025, respectively.

Note 4 – Goodwill and Other Intangible Assets

The following table provides information on the significant components of goodwill and other acquired intangible assets at June 30, 2025 and December 31, 2024.

June 30, 2025

The following table provides information on the significant components of goodwill and other acquired intangible assets at September 30, 2025 and December 31, 2024.

September 30, 2025

($ in thousands) Goodwill Core Deposit Intangible

Gross carrying amount $ 63,266 $ 59,151

Accumulated impairment charges ( 1,543 ) —

Accumulated amortization — ( 27,429 )

3 unchanged sentences

Gross carrying amount $ 63,266 $ 59,151

Accumulated impairment charges ( 1,543 ) —

Accumulated amortization — ( 20,840 )

Net carrying amount $ 63,266 $ 38,311

The aggregate amortization expense for the core deposit intangible was $ 2.3 million and $ 2.6 million for the three months ended June 30, 2025 and 2024, respectively and $ 4.5 million and $ 5.1 million for the six months ended June 30, 2025 and 2024, respectively.

At June 30, 2025, estimated future remaining amortization for amortizing core deposit intangibles within the years ending December 31, is as follows:

The aggregate amortization expense for the core deposit intangible was $ 2.0 million and $ 2.3 million for the three months ended September 30, 2025 and 2024, respectively and $ 6.6 million and $ 7.5 million for the nine months ended September 30, 2025 and 2024, respectively.

At September 30, 2025, the estimated future remaining amortization for amortizing core deposit intangibles within the years ending December 31 is as follows:

($ in thousands) Amortization Expense

9 unchanged sentences

The following tables present information about the Company’s leases as of and for the periods presented.

($ in thousands) June 30, 2025 December 31, 2024

($ in thousands) September 30, 2025 December 31, 2024

Lease liabilities $ 11,395 $ 11,844

4 unchanged sentences

Remaining lease term - max 15.93 years 16.68 years

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

Lease cost ($ in thousands)

3 unchanged sentences

Cash paid for amounts included in the measurement of lease liabilities $ 501 $ 449 $ 1,446 $ 1,367

The following table presents a maturity analysis of operating lease liabilities and a reconciliation of the undiscounted cash flows to total operating lease liabilities at June 30, 2025.

The following table presents a maturity analysis of operating lease liabilities and a reconciliation of the undiscounted cash flows to total operating lease liabilities at September 30, 2025.

Lease payments due ($ in thousands)

June 30, 2025

September 30, 2025

Thereafter 5,576

2 unchanged sentences

Lease liabilities $ 11,395

Total gross rental income was $ 280 thousand and $ 256 thousand for the three months ended June 30, 2025 and 2024, respectively.

Total gross rental income was $ 615 thousand and $ 533 thousand for the six months ended June 30, 2025 and 2024, respectively.

Total gross rental income was $ 225 thousand and $ 266 thousand for the three months ended September 30, 2025 and 2024, respectively.

Total gross rental income was $ 839 thousand and $ 799 thousand for the nine months ended September 30, 2025 and 2024, respectively.

Note 6 - Deposits

Deposits consist of the following categories as of the dates indicated:

($ in thousands) June 30, 2025 December 31, 2024

($ in thousands) September 30, 2025 December 31, 2024

Balance % of Total Deposits Balance % of Total Deposits

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Total deposits $ 5,528,165 100.00 % $ 5,528,336 100.00 %

The following table provides information on the approximate maturities of total time deposits at June 30, 2025.

($ in thousands) June 30, 2025

The following table provides information on the approximate maturities of total time deposits at September 30, 2025.

($ in thousands) September 30, 2025

Within one year $ 1,155,615

2 unchanged sentences

Total $ 1,281,132

The approximate amount of certificates of deposit that met or exceeded the FDIC insurance limit of $250,000 or more was $ 410.6 million and $ 374.1 million at June 30, 2025 and December 31, 2024, respectively.

The approximate amount of certificates of deposit that exceeded the FDIC insurance limit of $250,000 or more was $ 411.1 million and $ 374.1 million at September 30, 2025 and December 31, 2024, respectively.

Note 7 - Borrowings

The following table summarizes certain information of the Company’s long-term debt at June 30, 2025 and December 31, 2024.

($ in thousands) June 30, 2025 December 31, 2024 Issue Date Stated Maturity Date Earliest Call Date Interest Rate

September 2030 Subordinated Debentures $ 25,000 $ 25,000 2020 2030 2025 5.375 % through September 2025, 3-month SOFR* + 5.265 % thereafter

October 2030 Subordinated Debentures 19,500 19,500 2020 2030 2025 4.75 % through October 2025, 3-month SOFR + 4.58 % thereafter

The following table summarizes certain information of the Company’s long-term debt at September 30, 2025 and December 31, 2024.

($ in thousands) September 30, 2025 December 31, 2024 Issue Date Stated Maturity Date Earliest Call Date Interest Rate

Subordinated Debentures due September 2030 $ 25,000 $ 25,000 2020 2030 2025 5.375 % through September 2025, 3-month SOFR* + 5.265 % thereafter

Subordinated Debentures due October 2030 19,500 19,500 2020 2030 2025 4.75 % through October 2025, 3-month SOFR + 4.58 % thereafter

Total subordinated debentures 44,500 44,500

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* Secured Overnight Financing Rate (“SOFR”).

At June 30, 2025, subordinated notes consisted of $ 25.0 million of long-term debt issued by the Company in August 2020, and $ 19.5 million of long-term debt assumed as a result of the merger with TCFC.

As of June 30, 2025, the recorded balance of subordinated debt issued by the Company and the assumed subordinated debt from TCFC, net of unamortized issuance costs and fair value discounts, were $ 25.0 million and $ 19.3 million, respectively.

The Company also assumed trust preferred securities in the aggregate of $ 33.0 million as a result of the merger with TCFC in 2023 and the acquisition of Severn in 2021.

Trust preferred securities consisted of $ 20.6 million issued to Severn Capital Trust I, $ 7.2 million issued by Tri-County Capital Trust I and $ 5.2 million issued by Tri-County Capital Trust II.

The recorded balance of the debt acquired from Severn at June 30, 2025 was $ 18.9 million, net of the unamortized fair value adjustment of $ 1.8 million.

At June 30, 2025, the junior subordinated debt securities of Tri-County Capital Trust I and Tri-County Capital Trust II had a recorded balance of $ 6.7 million and $ 4.5 million, respectively, which are presented as net of the unamortized fair value adjustments of $ 538 thousand and $ 696 thousand, respectively.

At September 30, 2025, subordinated debentures consisted of $ 25.0 million of long-term debt issued by the Company in August 2020, and $ 19.5 million of long-term debt assumed as a result of the merger with TCFC.

As of September 30, 2025, the recorded balance of subordinated debt issued by the Company and the assumed subordinated debt from TCFC, net of unamortized issuance costs and fair value discounts, were $ 25.0 million and $ 19.4 million, respectively.

The Company has the option to redeem the subordinate notes in part or whole as of September 1, 2025.

As of September 30, 2025, 80 % of the subordinated debt was considered Tier 2 capital under current regulatory guidelines.

The Company assumed trust preferred securities in the aggregate of $ 33.0 million as a result of the merger with TCFC in 2023 and the acquisition of Severn in 2021.

Trust preferred securities consisted of $ 20.6 million issued by Severn Capital Trust I, $ 7.2 million issued by Tri-County Capital Trust I and $ 5.2 million issued by Tri-County Capital Trust II.

The recorded balance of the junior subordinated debt securities of Severn Capital Trust I at September 30, 2025 was $ 18.9 million, net of the unamortized fair value adjustment of $ 1.7 million.

At September 30, 2025, the junior subordinated debt securities of Tri-County Capital Trust I and Tri-County Capital Trust II had a recorded balance of $ 6.7 million and $ 4.5 million, respectively, which are presented net of the unamortized fair value adjustments of $ 523 thousand and $ 678 thousand, respectively.

As of September 30, 2025, the entire amount of trust preferred securities debt is considered Tier 2 capital under current regulatory guidelines.

The Company may periodically borrow from a correspondent federal funds line of credit arrangement, under a secured reverse repurchase agreement, or from the Federal Home Loan Bank (“FHLB”) to meet short-term liquidity needs.

There were $ 50.0 million of outstanding borrowings from the FHLB at June 30, 2025 and December 31, 2024.

There were $ 50.0 million of outstanding borrowings from the FHLB at September 30, 2025 and December 31, 2024.

The $ 50.0 million FHLB advance originated on May 7, 2024 was for an initial term of 18 -months at a rate of 4.79 %.

The Company did not have any short-term borrowings from the FHLB at June 30, 2025 and December 31, 2024.

Further information on these obligations is provided in the 2024 A nnual Report.

The Company did not have any short-term borrowings from the FHLB at September 30, 2025 and December 31, 2024.

Further information on these obligations is provided in the Company’s A nnual Report on Form 10-K for the year ended December 31, 2024 .

Note 8 – Derivatives

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The Company recognizes gains and losses through mortgage banking revenue in the consolidated statements of income.

IRLCs on mortgage loans that we intend to sell in the secondary market are considered derivatives.

We are exposed to price risk from the time a mortgage loan is locked in until the time the loan is sold.

IRLCs on mortgage loans that the Company intends to sell in the secondary market are considered derivatives.

The Company is exposed to price risk from the time a mortgage loan is locked in until the time the loan is sold.

The period of time between issuance of a loan commitment, closing and sale of the loan generally ranges from 14 days to 120 days, however, this period may be longer for construction to permanent loans that are originated with the intent of selling in the secondary market upon permanent financing.

For these IRLCs and our closed inventory in loans held for sale, we attempt to protect the Bank from changes in interest rates through the use of to be announced (“TBA”) securities, which are forward contracts, as well as, to a significantly lesser degree, loan level commitments in the form of best efforts and mandatory forward contracts.

For these IRLCs and closed inventory in loans held for sale, the Company attempts to protect itself from changes in interest rates through the use of to be announced (“TBA”) securities, which are forward contracts, as well as, to a significantly lesser degree, loan level commitments in the form of best efforts and mandatory forward contracts.

These assets and liabilities are included in the consolidated balance sheets in other assets and accrued expenses and other liabilities, respectively.

The following table provides information pertaining to the carrying amounts of the Company’s derivative financial instruments at June 30, 2025 and December 31, 2024.

June 30, 2025 December 31, 2024

The following table provides information pertaining to the carrying amounts of the Company’s derivative financial instruments at September 30, 2025 and December 31, 2024.

September 30, 2025 December 31, 2024

($ in thousands) Notional Amount Estimated Fair Value Notional Amount Estimated Fair Value

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24,250 38 22,100 164

Liability – IRLCs

Liability – TBA securities

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The Company records unrealized holding gains (losses), net of tax, on AFS securities as accumulated other comprehensive income (loss), a separate component of stockholders’ equity.

The following table provides information on the changes in the component of accumulated other comprehensive income (loss) for the three and six months ended June 30, 2025 and 2024.

The following table provides information on the changes in the component of accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2025 and 2024.

Accumulated Other Comprehensive Loss

($ in thousands) Three Months Ended June 30, 2025 Three Months Ended June 30, 2024 Six Months Ended June 30, 2025 Six Months Ended June 30, 2024

Three Months Ended Nine Months Ended

($ in thousands) September 30, 2025 September 30, 2024 September 30, 2025 September 30, 2024

Beginning of period $ ( 5,603 ) $ ( 8,260 ) $ ( 7,545 ) $ ( 7,494 )

Other comprehensive income (loss), net of tax 730 ( 202 ) 1,942 ( 766 )

Other comprehensive income, net of tax 844 2,734 2,786 1,968

End of period $ ( 4,759 ) $ ( 5,526 ) $ ( 4,759 ) $ ( 5,526 )

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Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Banks’ assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices.

The Banks’ capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors.

The Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy require the Company and Bank to maintain amounts and ratios (set forth in the table below) of common equity Tier 1 (“CET1”), Tier 1 and total capital (as defined in the regulations) to risk-weighted assets (as defined) and of Tier 1 capital (as defined) to average assets (leverage ratio).

As of June 30, 2025 and December 31, 2024, management believes that the Company and the Bank met all capital adequacy requirements to which they were subject.

As of December 31, 2024, the most recent notification from our primary regulator categorized the Bank, as “well-capitalized” under the regulatory framework for prompt corrective action.

As of September 30, 2025 and December 31, 2024, management believes that the Company and the Bank met all capital adequacy requirements to which they were subject.

As of December 31, 2024, the most recent notification from the Bank’s primary regulator categorized the Bank, as “well-capitalized” under the regulatory framework for prompt corrective action.

There are no conditions or events since that notification that management believes would change the Bank’s classification.

To be categorized as “well-capitalized,” the Bank must maintain minimum CET1, Tier 1 risk-based and total risk-based capital ratios, and Tier 1 leverage ratios, which are outlined in the table below.

The following table presents the capital amounts and ratios for the Company and the Bank as of June 30, 2025 and December 31, 2024.

2025 December 31,

The following table presents the capital amounts and ratios for the Company and the Bank as of September 30, 2025 and December 31, 2024.

September 30, 2025 December 31, 2024

Amount Regulatory Minimum Ratio + Capital Conservation Buffer To Be Well-Capitalized Under Prompt Corrective Action Regulation (1)

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Total Capital to RWA 12.88 10.50 N/A 12.18

Tier 1 Capital to AA (Leverage) (2)

Tier 1 Capital to Average Assets (Leverage) (2)

8.86 4.00 N/A 8.02

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Total Capital to RWA 12.75 10.50 10.00 11.97

Tier 1 Capital to AA (Leverage) (2)

Tier 1 Capital to Average Assets (Leverage) (2)

9.41 4.00 5.00 8.58

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(1) Applies to the Bank only.

(2) Tier 1 Capital to AA (Leverage) has no capital conservation buffer defined.

(2) Tier 1 Capital to Average Assets (Leverage) has no capital conservation buffer defined.

The PCA well-capitalized threshold is defined as 5.00 %.

As of June 30, 2025, both the Company and the Bank satisfy the capital conservation buffer requirements applicable to them.

As of September 30, 2025, both the Company and the Bank satisfy the capital conservation buffer requirements applicable to them.

The lowest ratio at the Company is the Tier 1 Capital to RWA, which was 4.82 % above the minimum buffer ratio and, at the Bank, the lowest ratio was the Total Capital to RWA, which was 4.75 % above the minimum buffer ratio.

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The amount of dividends that the Bank may declare and pay to the Company in any calendar year, without the receipt of prior approval from the Federal Reserve Bank, cannot exceed net income for that year to date plus retained net income (as defined) for the preceding two calendar years.

At June 30, 2025, the Bank could pay dividends to the Company to the extent of its earnings, so long as it maintained required capital ratios.

At September 30, 2025, the Bank could pay dividends to the Company to the extent of its earnings, so long as it maintained required capital ratios.

Note 11 – Fair Value Measurements

24 unchanged sentences

Loans held for sale are carried at fair value, which is determined based on Mark to Trade for allocated/committed loans or Mark to Market analysis for unallocated/uncommitted loans based on third-party pricing models (Level 2).

We utilize a third-party specialist model to estimate the fair value of our IRLCs, which are valued based upon mortgage securities (TBA) prices less estimated costs to process and settle the loan.

The Company utilizes a third-party specialist model to estimate the fair value of IRLCs, which are valued based upon mortgage securities (TBA) prices less estimated costs to process and settle the loan.

Fair value is adjusted for the estimated probability of the loan closing with the borrower (Level 3).

($ in thousands) Fair Value Valuation Technique Unobservable Input Range

June 30, 2025

September 30, 2025

IRLCs – net asset $ 215 Market Approach Range of pull through rate 79 % - 100 %

4 unchanged sentences

Average pull through rate 89 %

The following table presents activity in the IRLCs - net asset for the three and six months ended June 30, 2025.

($ in thousands) Three Months Ended June 30, 2025 Six Months Ended June 30, 2025

The following table presents activity in the IRLCs – net asset for the three and nine months ended September 30, 2025.

($ in thousands) Three Months Ended September 30, 2025 Nine Months Ended September 30, 2025

Beginning balance $ 426 $ 113

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Forward Contracts

To avoid interest rate risk, we hedge the open locked/closed position with TBA forward trades.

On a regular basis, we allocate disbursed loans to mandatory commitments with government-sponsored enterprises and private investors delivering the loans within 120 days of origination to maximize interest earnings.

For a small percentage of our business, we enter into best efforts forward sales commitments with investors at the time we make an IRLC to a borrower.

To avoid interest rate risk, the Company hedges the open locked/closed position with TBA forward trades.

On a regular basis, the Company allocates disbursed loans to mandatory commitments with government-sponsored enterprises and private investors delivering the loans within 120 days of origination to maximize interest earnings.

For a small percentage of business, the Company enters into best efforts forward sales commitments with investors at the time it makes an IRLC to a borrower.

Once a loan has been closed and funded, the best efforts commitments convert to mandatory forward sales commitments.

The mandatory commitments are derivatives, and we measure and report them at fair value.

Fair value is based on the gain or loss that would occur if we were to pair-off the transaction with the investor at the measurement date.

The mandatory commitments are derivatives, and the Company measures and reports them at fair value.

Fair value is based on the gain or loss that would occur if the Company were to pair-off the transaction with the investor at the measurement date.

This is a Level 2 input.

We have elected to measure and report best efforts commitments at fair value using a valuation methodology similar to that used for mandatory commitments.

The Company has elected to measure and report best efforts commitments at fair value using a valuation methodology similar to that used for mandatory commitments.

Market assumptions utilized in the fair value measurement of the reporting entity’s residential mortgage derivatives, inclusive of IRLCs, Closed Loan Inventory, TBA derivative trades, and Mandatory Forwards may be subject to investor overlays that may result in a significantly lower fair value measurement.

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Additionally market assumptions such as spec pool payups may result in a significantly higher fair value measurement at time of loan allocation to specific trades.

The following tables present the recorded amount of assets measured at fair value on a recurring basis at June 30, 2025 and December 31, 2024.

No assets were transferred from one hierarchy level to another during the six months ended June 30, 2025 or 2024.

The following tables present the recorded amount of assets measured at fair value on a recurring basis at September 30, 2025 and December 31, 2024.

No assets were transferred from one hierarchy level to another during the nine months ended September 30, 2025 or 2024.

($ in thousands) Fair Value Quoted Prices

1 unchanged sentence

(Level 2) Significant Unobservable Inputs

June 30, 2025

September 30, 2025

Available for sale securities:

8 unchanged sentences

Total assets at fair value $ 209,587 $ — $ 209,371 $ 216

IRLCs $ 1 $ — $ — $ 1

TBA forward trades 47 — 47 —

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Fair value adjustments for these assets are recorded in other noninterest expense in the consolidated statements of income.

The following tables set forth the Company’s assets subject to fair value adjustments (impairment) on a nonrecurring basis at June 30, 2025 and December 31, 2024 that are valued at lower of cost or market.

The following tables set forth the Company’s assets subject to fair value adjustments (impairment) on a nonrecurring basis at September 30, 2025 and December 31, 2024 that are valued at lower of cost or market.

Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

1 unchanged sentence

($ in thousands) Fair Value Valuation Technique Unobservable Input Range Weighted-Average

June 30, 2025

September 30, 2025

Nonrecurring measurements:

3 unchanged sentences

Liquidation expense (2)

Residential real estate 456 Appraisal of collateral (1)

Appraisal adjustment (2)

Liquidation expense (2)

Commercial 112 Appraisal of collateral (1)

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Certain items are specifically excluded from the financial instrument fair value disclosure requirements, including the Company’s common stock, OREO, premises and equipment and other assets and liabilities.

The following tables present the carrying amounts and estimated fair values of the Company’s financial instruments as of June 30, 2025 and December 31, 2024.

Fair values for June 30, 2025 and December 31, 2024 were estimated using an exit price notion.

June 30, 2025 Carrying Amount Fair Value Fair Value Measurements

The following tables present the carrying amounts and estimated fair values of the Company’s financial instruments as of September 30, 2025 and December 31, 2024.

Fair values for September 30, 2025 and December 31, 2024 were estimated using an exit price notion.

September 30, 2025 Carrying Amount Fair Value Fair Value Measurements

($ in thousands) Level 1 Level 2 Level 3

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Equity securities 6,113 6,113 — 6,113 —

Restricted securities 20,412 20,412 — 20,412 —

Restricted securities 20,364 N/A — N/A —

Loans held for sale 21,500 21,500 — 21,500 —

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Accrued interest payable 3,403 3,403 — 3,403 —

IRLCs 1 1 — — 1

December 31, 2024 Carrying Amount Fair Value Fair Value Measurements

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Commitments to make loans are generally made for a period of 90 days or less.

As of June 30, 2025 , the Company’s outstanding fixed rate loan commitments have interest rates ra nging from 6.50 % to 9.75 %.

The following table provides information on commitments outstanding at June 30, 2025 and December 31, 2024.

($ in thousands) June 30, 2025 December 31, 2024

As of September 30, 2025 , the Company’s outstanding fixed rate loan commitments have interest rates ra nging from 6.49 % to 9.24 %.

The following table provides information on commitments outstanding at September 30, 2025 and December 31, 2024.

($ in thousands) September 30, 2025 December 31, 2024

Commitments to extend credit

7 unchanged sentences

Total commitments outstanding $ 738,536 $ 787,441

The Bank had a reserve for off-balance sheet credit exposures of $ 1.9 million and $ 1.1 million as of June 30, 2025 and December 31, 2024, respectively.

The Bank had a reserve for off-balance sheet credit exposures of $ 2.1 million and $ 1.1 million as of September 30, 2025 and December 31, 2024, respectively.

The reserve was estimated based on the historic losses experienced by the Company.

6 unchanged sentences

Diluted earnings per common share is calculated by dividing net income available to common stockholders by the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents (stock-based awards).

The following table provides information relating to the calculation of earnings per common share for the three months ended June 30, 2025 and 2024.

Three Months Ended June 30, Six Months Ended June 30,

The following table provides information relating to the calculation of earnings per common share for the three months ended September 30, 2025 and 2024.

Three Months Ended September 30, Nine Months Ended September 30,

($ in thousands, except per share data) 2025 2024 2025 2024

6 unchanged sentences

Diluted net income per common share $ 0.43 $ 0.34 $ 1.31 $ 0.92

There were three thousand and zero anti-dilutive unvested restricted stock and performance stock unit awards excluded from the calculation of diluted earnings per share for the three months ended June 30, 2025 and 2024, respectively.

There were three thousand and zero anti-dilutive unvested restricted stock and performance stock unit awards excluded from the calculation of diluted earnings per share for the six months ended June 30, 2025 and 2024, respectively.

There were zero anti-dilutive unvested restricted stock and performance stock unit awards excluded from the calculation of diluted earnings per share for both the three months ended September 30, 2025 and 2024.

There were 483 and zero anti-dilutive unvested restricted stock and performance stock unit awards excluded from the calculation of diluted earnings per share for the nine months ended September 30, 2025 and 2024, respectively.

Note 15 – Revenue Recognition

Topic 606 does not apply to revenue associated with financial instruments, including revenue from loans and securities.

Topic 606 is applicable to noninterest revenue streams such as trust and asset management income, deposit related fees, interchange fees and merchant income.

Noninterest revenue streams in-scope of Topic 606 are discussed below.

Topic 606 does not apply to revenue associated with financial instruments, including revenue from loans and securities.

Service Charges on Deposit Accounts

11 unchanged sentences

Payment is received shortly after services are rendered.

Title Company Revenue

Title Company revenue consists of revenue earned on performing title work for real estate transactions.

The revenue is earned when the title work is performed.

Payment for such performance obligations generally occurs at the time of the settlement of a real estate transaction.

As such settlement is generally within 90 days of the performance of the title work, the Company recognizes the revenue at the time of the settlement.

All contract issuance costs are expensed as incurred.

The Company had no contract assets or liabilities at June 30, 2025.

Other Noninterest Income

2 unchanged sentences

Debit and credit card income primarily comprises interchange fees earned whenever the Company’s debit and credit cards are processed through card payment networks such as Mastercard and Visa.

ATM fees are primarily generated when a Company cardholder uses a non-Company ATM or a non-Company cardholder uses a Company ATM.

ATM fees are primarily

generated when a Company cardholder uses a non-Company ATM or a non-Company cardholder uses a Company ATM.

Merchant services income mainly represents fees charged to merchants to process their debit and credit card transactions, in addition to account management fees.

3 unchanged sentences

Safe deposit box rental fees are charged to the customer on an annual basis and recognized upon receipt of payment.

The Company determined that rentals and renewals of safe deposit boxes will be recognized on a monthly basis consistent with the duration of the performance obligation.

The following presents noninterest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the three and six months ended June 30, 2025 and 2024.

Three Months Ended June 30, Six Months Ended June 30,

The following presents noninterest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the three and nine months ended September 30, 2025 and 2024.

Three Months Ended September 30, Nine Months Ended September 30,

($ in thousands) 2025 2024 2025 2024

17 unchanged sentences

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

What changed 10-Q

Item 1. Financial Statements