SHORE BANCSHARES INC 10-Q

Item 1. FINANCIAL STATEMENTS SHORE BANCSHARES, INC. CONSOLIDATED BALANCE SHEETS ($ in thousands, except per share data) March 31, 2026 December 31, 2025 ASSETS (Unaudited) Cash and due from banks $ 44,054 $ 50,164 Interest-bearing deposits with other banks 296,768 305,402 Cash and cash equivalents 340,822 355,566 Investment securities: Available for sale, at fair value (amortized cost of $ 271,276 and $ 226,677 at March 31, 2026 and December 31, 2025, respectively) 264,026 220,358 Held to maturity, net of allowance for credit losses of $ 81 and $ 99 (fair value of $ 356,390 and $ 378,116 at March 31, 2026 and December 31, 2025, respectively) 393,615 414,827 Equity securities, at fair value 6,195 6,186 Restricted securities, at cost 18,003 17,989 Loans held for sale, at fair value 24,034 32,540 Loans held for investment 4,848,030 4,900,302 Less: allowance for credit losses ( 58,481 ) ( 58,836 ) Loans, net 4,789,549 4,841,466 Premises and equipment, net 80,137 80,168 Goodwill 63,266 63,266 Other intangible assets, net 27,742 29,722 Right-of-use assets 10,102 10,523 Cash surrender value on life insurance 106,684 105,839 Accrued interest receivable 20,676 18,551 Deferred income taxes 29,752 29,825 Other assets 31,460 31,992 TOTAL ASSETS $ 6,206,063 $ 6,258,818 LIABILITIES Deposits: Noninterest-bearing $ 1,567,425 $ 1,587,953 Interest-bearing checking 812,847 852,585 Money market and savings 1,795,619 1,814,928 Time deposits 1,274,766 1,267,487 Brokered deposits 10,963 10,911 Total deposits 5,461,620 5,533,864 Guaranteed preferred beneficial interest in junior subordinated debentures (“TRUPS”), net 30,247 30,168 Subordinated debt, net 58,782 58,893 Total borrowings 89,029 89,061 Lease liabilities 10,608 11,027 Other liabilities 42,092 34,993 TOTAL LIABILITIES 5,603,349 5,668,945 COMMITMENTS AND CONTINGENCIES (Note 13) STOCKHOLDERS’ EQUITY Common stock, $ 0.01 par value per share; shares authorized 50,000,000 ; shares issued and outstanding 33,451,063 and 33,413,503 at March 31, 2026 and December 31, 2025, respectively 335 334 Additional paid-in capital 361,013 360,554 Retained earnings 246,636 233,578 Accumulated other comprehensive loss ( 5,270 ) ( 4,593 ) TOTAL STOCKHOLDERS’ EQUITY 602,714 589,873 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 6,206,063 $ 6,258,818 See accompanying notes to unaudited consolidated financial statements. 3 Table of Contents SHORE BANCSHARES, INC. CONSOLIDATED STATEMENTS OF INCOME (Unaudited) Three Months Ended March 31, ($ in thousands, except per share data) 2026 2025 INTEREST INCOME Interest on loans $ 70,814 $ 67,516 Interest and dividends on taxable investment securities 5,114 5,001 Interest and dividends on tax-exempt investment securities 6 6 Interest on deposits with other banks 2,458 3,409 Total interest income 78,392 75,932 INTEREST EXPENSE Interest on deposits 24,264 28,070 Interest on short-term borrowings — 598 Interest on long-term borrowings 1,573 1,366 Total interest expense 25,837 30,034 NET INTEREST INCOME 52,555 45,898 Provision for credit losses 85 1,028 NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES 52,470 44,870 NONINTEREST INCOME Service charges on deposit accounts 1,596 1,514 Trust and investment fee income 1,137 823 Mortgage banking revenue 1,450 1,240 Interchange credits 1,698 1,577 Other noninterest income 1,363 1,980 Total noninterest income 7,244 7,134 NONINTEREST EXPENSE Salaries and employee benefits 19,639 16,440 Occupancy expense 2,567 2,538 Furniture and equipment expense 855 853 Software and data processing 5,140 4,691 Amortization of other intangible assets 1,980 2,278 Legal and professional fees 1,605 1,613 FDIC insurance premium expense 995 1,091 Marketing and advertising 311 254 Fraud losses 111 105 Other noninterest expense 3,853 3,884 Total noninterest expense 37,056 33,747 Income before income taxes 22,658 18,257 Income tax expense 5,570 4,493 NET INCOME $ 17,088 $ 13,764 Basic net income per common share $ 0.51 $ 0.41 Diluted net income per common share $ 0.51 $ 0.41 Dividends paid per common share $ 0.12 $ 0.12 See accompanying notes to unaudited consolidated financial statements. 4 Table of Contents SHORE BANCSHARES, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) Three Months Ended March 31, ($ in thousands) 2026 2025 Net income $ 17,088 $ 13,764 Other comprehensive income (loss): Investment securities: Unrealized holding (losses) gains on available for sale securities ( 931 ) 1,667 Tax effect 254 ( 455 ) Total other comprehensive (loss) income ( 677 ) 1,212 Comprehensive income $ 16,411 $ 14,976 See accompanying notes to unaudited consolidated financial statements. 5 Table of Contents SHORE BANCSHARES, INC. CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (Unaudited) ($ in thousands) Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Stockholders’ Equity Balances, December 31, 2025 $ 334 $ 360,554 $ 233,578 $ ( 4,593 ) $ 589,873 Net income — — 17,088 — 17,088 Other comprehensive loss — — — ( 677 ) ( 677 ) Common shares issued for employee stock purchase plan — 90 — — 90 Stock-based compensation 1 369 — — 370 Cash dividends at $ 0.12 per common share — — ( 4,030 ) — ( 4,030 ) Balances, March 31, 2026 $ 335 $ 361,013 $ 246,636 $ ( 5,270 ) $ 602,714 See accompanying notes to unaudited consolidated financial statements. 6 Table of Contents SHORE BANCSHARES, INC. CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (Unaudited) – Continued ($ in thousands) Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Stockholders’ Equity Balances, December 31, 2024 $ 333 $ 358,112 $ 190,166 $ ( 7,545 ) $ 541,066 Net income — — 13,764 — 13,764 Other comprehensive income — — — 1,212 1,212 Stock-based compensation — 460 — — 460 Cash dividends at $ 0.12 per common share — — ( 4,032 ) — ( 4,032 ) Balances, March 31, 2025 $ 333 $ 358,572 $ 199,898 $ ( 6,333 ) $ 552,470 See accompanying notes to unaudited consolidated financial statements. 7 Table of Contents SHORE BANCSHARES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Three Months Ended March 31, ($ in thousands) 2026 2025 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 17,088 $ 13,764 Adjustments to reconcile net income to net cash provided by operating activities: Net accretion of acquisition accounting estimates ( 4,263 ) ( 3,153 ) Provision for credit losses 85 1,028 Depreciation and amortization 3,578 4,077 Net amortization of securities ( 69 ) 36 Amortization of debt issuance costs 72 30 Gain on mortgage loans held for sale ( 1,549 ) ( 966 ) Loss (gain) on other mortgage loan activity 238 ( 284 ) Proceeds from sale of mortgage loans held for sale 50,845 33,739 Originations of loans held for sale ( 41,379 ) ( 29,362 ) Stock-based compensation expense 913 511 Deferred income tax expense (benefit) 327 ( 26 ) Loss (gain) on sales and valuation adjustments of repossessed assets 127 94 Loss on valuation adjustments on mortgage servicing rights 159 330 Loss on disposal of fixed assets — 27 Loss (gain) on disposal of premises held for sale — 61 Loss (gain) on sales and valuation adjustments on other real estate owned 44 — Fair value adjustment on equity securities 39 ( 87 ) Bank-owned life insurance income ( 33 ) ( 529 ) Net changes in: Accrued interest receivable ( 2,125 ) ( 985 ) Other assets 587 740 Accrued interest payable 932 ( 39 ) Other liabilities 5,957 777 Net cash provided by operating activities 31,573 19,783 CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from maturities and principal payments of available for sale securities 5,518 3,701 Proceeds from maturities and principal payments of held to maturity securities 21,108 11,388 Purchases of available for sale securities ( 49,926 ) ( 31,865 ) Purchases of equity securities ( 48 ) ( 44 ) Purchase of restricted securities ( 14 ) ( 158 ) Net change in loans 55,093 ( 2,256 ) Purchases of premises and equipment ( 1,087 ) ( 1,024 ) Proceeds from sales of repossessed assets 82 1,234 Purchases of bank owned life insurance ( 316 ) ( 90 ) Proceeds from disposal of premises held for sale — 843 Net cash provided (used in) by investing activities $ 30,410 $ ( 18,271 ) See accompanying notes to unaudited consolidated financial statements. 8 Table of Contents SHORE BANCSHARES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) – Continued Three Months Ended March 31, ($ in thousands) 2026 2025 CASH FLOWS FROM FINANCING ACTIVITIES: Net changes in: Noninterest-bearing deposits $ ( 20,528 ) $ 2,202 Interest-bearing deposits ( 51,716 ) ( 70,527 ) Shares withheld as tax payments associated with settlement of restricted stock units ( 543 ) — Common stock dividends paid ( 4,030 ) ( 4,032 ) Issuance of common stock 90 — Net cash used in financing activities ( 76,727 ) ( 72,357 ) Net decrease in cash and cash equivalents ( 14,744 ) ( 70,845 ) Cash and cash equivalents at beginning of period 355,566 459,851 Cash and cash equivalents at end of period $ 340,822 $ 389,006 Supplemental cash flow information: Interest paid $ 24,754 $ 29,477 Recognition of lease liabilities arising from right-of-use assets — 915 Transfers from loans to repossessed assets 674 569 Unrealized (losses) gains on available for sale securities ( 931 ) 1,667 See accompanying notes to unaudited consolidated financial statements. 9 Table of Contents Shore Bancshares, Inc. Notes to Consolidated Financial Statements (Unaudited) Note 1 – Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying unaudited interim consolidated financial statements include the accounts of Shore Bancshares, Inc. and its subsidiaries (collectively referred to in these Notes as the “Company”), with all significant intercompany transactions eliminated. The accounting and reporting policies of the Company conform with generally accepted accounting principles in the United States of America (“GAAP”). For purposes of comparability, certain reclassifications have been made to amounts previously reported to conform with the current period presentation. Reclassifications had no effect on prior year net income or stockholders’ equity. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements, and related notes thereto, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Annual Report”). Nature of Operations The Company engages in the banking business through Shore United Bank, N.A. (the “Bank”), a national banking association with locations in Maryland, Delaware and Virginia. 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. The Company engages in financial service offerings through Wye Financial Partners, a division of the Bank, and offers corporate trustee services through Wye Trust, a division of the Bank. Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and in the related disclosures. These estimates are based on information available as of the date of the consolidated financial statements. While management makes its best judgments, actual amounts or results could differ from these estimates. Recent Accounting Pronouncements On January 2026, the Company adopted ASU 2025‑08, Financial Instruments—Credit Losses (Topic 326): Purchased Loans, which expanded the use of the gross‑up method beyond purchased credit‑deteriorated (“PCD”) assets to include purchased seasoned loans (“PSLs”). Under the amended guidance, a non‑PCD loan (excluding credit cards) is considered seasoned if it is acquired in a business combination, or if it is purchased at least 90 days after origination and the acquirer was not involved in the origination of the loan. Qualifying PSLs are recorded at acquisition at their purchase price plus an allowance for expected credit losses, with no corresponding provision for credit losses recognized at acquisition, thereby eliminating the Day 1 provision for credit losses previously required for non‑PCD acquired loans. The early adoption of this guidance did not result in a material impact on the Bank’s/Company’s (consolidated) financial statements at the time of adoption; however, it is expected to reduce income statement volatility in future periods by eliminating Day 1 provisions for credit losses on qualifying acquired loans and improving comparability in acquisition accounting. 10 Table of Contents Note 2 – Investment Securities The following tables provide information on the amortized cost and estimated fair values of investment securities as of March 31, 2026 and December 31, 2025. ($ in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available for sale securities (1) : March 31, 2026 U.S. Treasury and government agency securities $ 22,092 $ — $ 1,728 $ 20,364 Mortgage-backed securities 236,638 195 6,157 230,676 Other debt securities (2) 12,546 440 — 12,986 Total $ 271,276 $ 635 $ 7,885 $ 264,026 December 31, 2025 U.S. Treasury and government agency securities $ 22,303 $ 2 $ 1,689 $ 20,616 Mortgage-backed securities 200,105 331 5,409 195,027 Other debt securities (2) 4,269 446 — 4,715 Total $ 226,677 $ 779 $ 7,098 $ 220,358 ____________________________________ (1) No available for sale (“AFS”) securities were sold during the three months ended March 31, 2026 and 2025. (2) Other debt securities includes corporate and municipal bond obligations of state and political entities. ($ in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Allowance for Credit Losses Held to maturity securities: March 31, 2026 U.S. Treasury and government agency securities $ 92,514 $ — $ 4,503 $ 88,011 $ — Mortgage-backed securities 294,223 123 32,526 261,820 — Other debt securities (1) 6,959 19 419 6,559 81 Total $ 393,696 $ 142 $ 37,448 $ 356,390 $ 81 December 31, 2025 U.S. Treasury and government agency securities $ 104,836 $ 2 $ 4,513 $ 100,325 $ — Mortgage-backed securities 303,129 255 32,167 271,217 — Other debt securities (1) 6,961 33 420 6,574 99 Total $ 414,926 $ 290 $ 37,100 $ 378,116 $ 99 ____________________________________ (1) Other debt securities includes corporate and municipal bond obligations of state and political entities. Equity securities with aggregate fair values of $ 6.2 million as of both March 31, 2026 and December 31, 2025, respectively, are presented separately on the consolidated balance sheets. The fair value adjustments recorded through earnings totaled gains of $ 8 thousand and $ 131 thousand for the three months ended March 31, 2026 and 2025, 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 ($ in thousands) March 31, 2026 March 31, 2025 Balance, beginning of period $ 99 $ 203 Reversal of credit losses, other debt securities ( 18 ) ( 25 ) Balance, end of period $ 81 $ 178 A reversal of the provision for credit losses of $ 18 thousand and $ 25 thousand was recorded on HTM corporate and municipal bonds for the three months ended March 31, 2026 and 2025, respectively. 11 Table of Contents 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 as of March 31, 2026 and December 31, 2025. Less than 12 Months More than 12 Months Total ($ in thousands) Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses March 31, 2026 Available for sale securities: U.S. Treasury and government agency securities $ 14 $ — $ 17,808 $ 1,728 $ 17,822 $ 1,728 Mortgage-backed securities 127,521 1,173 63,314 4,984 190,835 6,157 Total $ 127,535 $ 1,173 $ 81,122 $ 6,712 $ 208,657 $ 7,885 Less than 12 Months More than 12 Months Total ($ in thousands) Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses December 31, 2025 Available for sale securities: U.S. Treasury and government agency securities $ — $ — $ 18,027 $ 1,689 $ 18,027 $ 1,689 Mortgage-backed securities 102,954 531 47,656 4,878 150,610 5,409 Total $ 102,954 $ 531 $ 65,683 $ 6,567 $ 168,637 $ 7,098 There were 134 AFS debt securities with a fair value below the amortized cost basis, with unrealized losses totaling $ 7.9 million as of March 31, 2026. The Company concluded that a credit loss does not exist in its AFS securities portfolio as of March 31, 2026, 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. government agencies or U.S. government-sponsored enterprises. Collectively, these entities provide a guarantee, which is either explicitly or implicitly supported by the full faith and credit of the U.S. 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 March 31, 2026 and December 31, 2025. 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 134 AFS and 167 HTM securities in an unrealized loss position at March 31, 2026. There were 122 AFS and 169 HTM securities in an unrealized loss position at December 31, 2025. Net unrealized losses with respect to the AFS securities totaled $ 7.3 million and $ 6.3 million as of March 31, 2026 and December 31, 2025, respectively. 12 Table of Contents The following table provides information on the amortized cost and estimated fair values of investment securities by contractual maturity date at March 31, 2026. Available for Sale Held to Maturity ($ in thousands) Amortized Cost Fair Value Amortized Cost Fair Value Due in one year or less $ 2,484 $ 2,484 $ 23,801 $ 23,650 Due after one year through five years 21,130 19,557 60,173 57,447 Due after five years through ten years 10,942 11,227 10,457 8,926 Due after ten years 82 82 5,042 4,547 Total non-mortgage-backed securities $ 34,638 $ 33,350 $ 99,473 $ 94,570 Mortgage-backed securities 236,638 230,676 294,223 261,820 Total $ 271,276 $ 264,026 $ 393,696 $ 356,390 The maturity dates for debt securities are determined using contractual maturity dates. Actual maturities may differ from amounts presented because certain issuers have the right to call or prepay obligations without prepayment penalties. 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 March 31, 2026, the aggregate carrying value of AFS and HTM pledged securities was $ 71.9 million and $ 220.6 million, respectively. The comparable amounts for December 31, 2025 were $ 69.4 million and $ 218.6 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 March 31, 2026 and December 31, 2025. March 31, 2026 December 31, 2025 ($ in thousands) Amortized Cost Fair Value Amortized Cost Fair Value Pledged available for sale securities $ 74,643 $ 71,914 $ 75,123 $ 69,369 Pledged held to maturity securities 220,597 198,537 218,556 197,146 There were no obligations of any issuer exceeding 10% of stockholders’ equity at March 31, 2026 or December 31, 2025. Note 3 – Loans and Allowance for Credit Losses The measurement of expected credit losses under the CECL methodology is applicable to financial assets measured at amortized cost, including loan receivables. For further discussion on the most significant accounting policies that the Company follows, see Note 1 – “Summary of Significant Accounting Policies” in the “Notes to Consolidated Financial Statements” included in Part II, Item 8 of the 2025 Annual Report. The following table provides information about the principal classes of the loan portfolio at March 31, 2026 and December 31, 2025. ($ in thousands) March 31, 2026 % of Total Loans December 31, 2025 % of Total Loans Commercial real estate $ 2,599,815 53.62 % $ 2,643,996 53.95 % Residential real estate 1,425,733 29.41 1,414,964 28.88 Construction 342,835 7.07 344,903 7.04 Commercial 220,833 4.56 226,006 4.61 Consumer 254,478 5.25 265,912 5.43 Credit cards 4,336 0.09 4,521 0.09 Total loans 4,848,030 100.00 % 4,900,302 100.00 % Less: allowance for credit losses ( 58,481 ) ( 58,836 ) Total loans, net $ 4,789,549 $ 4,841,466 Loans are stated at their principal amount outstanding, net of any purchase premiums or discounts, deferred fees, and costs. Included in loans were deferred costs, net of fees, of $ 3.0 million and $ 3.1 million at March 31, 2026 and December 31, 2025, respectively. At March 31, 2026 and December 31, 2025, loans included $ 1.42 billion and $ 1.49 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 are 13 Table of Contents presented net of the related aggregate discounts, which totaled $ 73.9 million and $ 78.2 million at March 31, 2026 and December 31, 2025, respectively. The following tables provide information on the amortized cost basis of nonaccrual loans by loan class as of March 31, 2026 and December 31, 2025. ($ in thousands) Nonaccrual With No Allowance For Credit Losses Nonaccrual With An Allowance For Credit Losses Total Nonaccrual Loans March 31, 2026 Nonaccrual loans: Commercial real estate $ 40,989 $ 11,292 $ 52,281 Residential real estate 8,116 961 9,077 Construction 161 — 161 Commercial 256 2,586 2,842 Consumer 475 59 534 Credit cards — 63 63 Total $ 49,997 $ 14,961 $ 64,958 Interest income $ 655 $ 295 $ 950 ($ in thousands) Nonaccrual With No Allowance For Credit Losses Nonaccrual With An Allowance For Credit Losses Total Nonaccrual Loans December 31, 2025 Nonaccrual loans: Commercial real estate $ 6,135 $ 19,498 $ 25,633 Residential real estate 9,594 544 10,138 Construction 88 — 88 Commercial 2,297 784 3,081 Consumer 898 74 972 Credit cards — 48 48 Total $ 19,012 $ 20,948 $ 39,960 Interest income $ 285 $ 363 $ 648 ($ in thousands) Nonaccrual Delinquent Loans Nonaccrual Current Loans Total Nonaccrual Loans March 31, 2026 Nonaccrual loans: Commercial real estate $ 1,838 $ 50,443 $ 52,281 Residential real estate 4,651 4,426 9,077 Construction 161 — 161 Commercial — 2,842 2,842 Consumer 75 459 534 Credit cards 63 — 63 Total $ 6,788 $ 58,170 $ 64,958 14 Table of Contents ($ in thousands) Nonaccrual Delinquent Loans Nonaccrual Current Loans Total Nonaccrual Loans December 31, 2025 Nonaccrual loans: Commercial real estate $ 2,809 $ 22,824 $ 25,633 Residential real estate 3,808 6,330 10,138 Construction 88 — 88 Commercial 196 2,885 3,081 Consumer 491 481 972 Credit cards 32 16 48 Total $ 7,424 $ 32,536 $ 39,960 The overall quality of the Company’s loan portfolio is primarily assessed using the Company’s risk-grading scale. This review process is assisted by frequent internal reporting of loan production, loan quality, concentrations of credit, loan delinquencies and nonperforming and potential problem loans. Credit quality indicators are adjusted based on management’s judgment during the quarterly review process. Consumer credit cards are monitored based on a borrower’s payment history. Credit card loans are classified as performing and are typically charged-off no later than 180 days or when, in the opinion of management, the collection of principal or interest is considered doubtful. As of March 31, 2026, there were five credit 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. Ratings 1 through 6 – Pass – Ratings 1 through 6 have asset risks ranging from excellent-low to adequate. The specific rating assigned considers customer history of earnings, cash flows, liquidity, leverage, capitalization, consistency of debt service coverage, the nature and extent of customer relationship and other relevant specific business factors such as the stability of the industry or market area, changes to management, litigation or unexpected events that could have an impact on risks. Rating 7 – Special Mention – These credits have potential weaknesses due to economic conditions, less than adequate earnings performance or other factors which require the lending officer to direct more than normal attention to the credit. Financing alternatives may be limited and/or command higher risk interest rates. Special mention loan relationships are reviewed at least quarterly. Rating 8 – Substandard – Substandard assets are assets that are inadequately protected by the sound worth or paying capacity of the borrower or of the collateral pledged. Substandard loans are the first adversely classified loans on the Bank’s watchlist. These assets have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the possibility that the Company will sustain some loss if the deficiencies are not corrected. Loss potential, while existing in the aggregate amount of substandard assets, does not have to exist in individual assets classified substandard. The loans may have a delinquent history or combination of weak collateral, weak guarantor or operating losses. When a loan is assigned to this category, the Company may estimate a specific reserve in the credit loss allowance analysis and/or place the loan on nonaccrual. These assets listed may include assets with histories of repossessions or some that are nonperforming bankruptcies. Substandard loan relationships are reviewed at least quarterly. Rating 9 – Doubtful – Doubtful assets have many of the same characteristics of substandard assets, with the exception that the Company has determined that loss is not only possible but is probable. The amount of loss is not discernible due to factors such as merger, acquisition, or liquidation; a capital injection; a pledge of additional collateral; the sale of assets; or alternative refinancing plans. Credits receiving a doubtful classification are required to be on nonaccrual. Doubtful loan relationships are reviewed at least quarterly. Rating 10 – Loss – Loss assets are uncollectible or of little value. 15 Table of Contents The following table provides information on loan risk ratings as of March 31, 2026 and gross charge-offs during the three months ended March 31, 2026. Term Loans by Origination Year Revolving loans Revolving converted to term loans Total ($ in thousands) Prior 2022 2023 2024 2025 2026 March 31, 2026 Commercial real estate Pass $ 1,263,079 $ 522,428 $ 218,721 $ 150,567 $ 262,491 $ 19,074 $ 19,093 $ 150 $ 2,455,603 Special mention 28,222 50,924 341 272 — — — — 79,759 Substandard 26,233 16,287 19,723 1,239 621 — 350 — 64,453 Total $ 1,317,534 $ 589,639 $ 238,785 $ 152,078 $ 263,112 $ 19,074 $ 19,443 $ 150 $ 2,599,815 Gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ — Residential real estate Pass $ 484,287 $ 272,211 $ 199,154 $ 157,905 $ 123,083 $ 25,120 $ 136,107 $ 40 $ 1,397,907 Special mention 16,841 191 504 — — — 65 — 17,601 Substandard 7,965 715 316 — 110 — 1,119 — 10,225 Total $ 509,093 $ 273,117 $ 199,974 $ 157,905 $ 123,193 $ 25,120 $ 137,291 $ 40 $ 1,425,733 Gross charge-offs $ ( 138 ) $ — $ — $ — $ — $ — $ ( 4 ) $ — $ ( 142 ) Construction Pass $ 32,869 $ 6,929 $ 27,791 $ 90,705 $ 151,703 $ 17,237 $ 14,252 $ 946 $ 342,432 Special mentions — — — — — — — — — Substandard 161 — — — 242 — — — 403 Total $ 33,030 $ 6,929 $ 27,791 $ 90,705 $ 151,945 $ 17,237 $ 14,252 $ 946 $ 342,835 Gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ — Commercial Pass $ 48,218 $ 17,998 $ 14,055 $ 26,743 $ 34,088 $ 5,557 $ 65,685 $ 1,419 $ 213,763 Special mention 22 89 95 70 52 — 83 — 411 Substandard 920 661 484 577 18 290 3,709 — 6,659 Total $ 49,160 $ 18,748 $ 14,634 $ 27,390 $ 34,158 $ 5,847 $ 69,477 $ 1,419 $ 220,833 Gross charge-offs $ ( 2 ) $ ( 37 ) $ ( 149 ) $ — $ — $ — $ ( 15 ) $ — $ ( 203 ) Consumer Pass $ 49,914 $ 83,717 $ 35,458 $ 27,786 $ 44,744 $ 11,598 $ 727 $ — $ 253,944 Special mention — — — — — — — — — Substandard 8 60 407 — 59 — — — 534 Total $ 49,922 $ 83,777 $ 35,865 $ 27,786 $ 44,803 $ 11,598 $ 727 $ — $ 254,478 Gross charge-offs $ ( 437 ) $ ( 362 ) $ — $ ( 17 ) $ ( 15 ) $ — $ — $ — $ ( 831 ) Total Pass $ 1,878,367 $ 903,283 $ 495,179 $ 453,706 $ 616,109 $ 78,586 $ 235,864 $ 2,555 $ 4,663,649 Special mention 45,085 51,204 940 342 52 — 148 — 97,771 Substandard 35,287 17,723 20,930 1,816 1,050 290 5,178 — 82,274 Total loans by risk category $ 1,958,739 $ 972,210 $ 517,049 $ 455,864 $ 617,211 $ 78,876 $ 241,190 $ 2,555 $ 4,843,694 Total gross charge-offs $ ( 577 ) $ ( 399 ) $ ( 149 ) $ ( 17 ) $ ( 15 ) $ — $ ( 19 ) $ — $ ( 1,176 ) 16 Table of Contents The following table presents the amortized cost of credit card loans based on performing status and gross charge-offs during the three months ended March 31, 2026. Nonperforming loans consisted of nonaccrual loans and loans past due 90 days or more and still accruing. Term Loans by Origination Year Revolving Loans Revolving Converted to Term Loans Total ($ in thousands) Prior 2022 2023 2024 2025 2026 March 31, 2026 Credit cards Performing $ — $ — $ — $ — $ — $ — $ 4,273 $ — $ 4,273 Nonperforming — — — — — — 63 — 63 Total $ — $ — $ — $ — $ — $ — $ 4,336 $ — $ 4,336 Gross charge-offs $ — $ — $ — $ — $ — $ — $ ( 80 ) $ — $ ( 80 ) Total loans evaluated by performing status $ — $ — $ — $ — $ — $ — $ 4,336 $ — $ 4,336 Total gross charge-offs $ ( 577 ) $ ( 399 ) $ ( 149 ) $ ( 17 ) $ ( 15 ) $ — $ ( 99 ) $ — $ ( 1,256 ) Total recorded investment $ 1,958,739 $ 972,210 $ 517,049 $ 455,864 $ 617,211 $ 78,876 $ 245,526 $ 2,555 $ 4,848,030 17 Table of Contents The following table provides information on loan risk ratings as of December 31, 2025 and gross charge-offs during the year ended December 31, 2025. Term Loans by Origination Year Revolving Loans Revolving Converted to Term Loans Total ($ in thousands) Prior 2021 2022 2023 2024 2025 December 31, 2025 Commercial real estate Pass $ 939,986 $ 364,719 $ 556,924 $ 242,170 $ 139,929 $ 265,405 $ 14,703 $ 27,136 $ 2,550,972 Special mention 15,105 2,884 34,014 344 — — — — 52,347 Substandard 20,056 16,806 2,840 — 283 — 692 — 40,677 Total $ 975,147 $ 384,409 $ 593,778 $ 242,514 $ 140,212 $ 265,405 $ 15,395 $ 27,136 $ 2,643,996 Gross charge-offs $ ( 109 ) $ ( 2,640 ) $ — $ — $ — $ — $ — $ — $ ( 2,749 ) Residential real estate Pass $ 317,764 $ 182,198 $ 275,869 $ 215,397 $ 147,517 $ 114,300 $ 131,075 $ 695 $ 1,384,815 Special mention 3,719 14,777 — 504 — — 65 — 19,065 Substandard 6,990 2,012 267 330 — 112 1,373 — 11,084 Total $ 328,473 $ 198,987 $ 276,136 $ 216,231 $ 147,517 $ 114,412 $ 132,513 $ 695 $ 1,414,964 Gross charge-offs $ ( 5 ) $ — $ — $ — $ — $ — $ ( 45 ) $ — $ ( 50 ) Construction Pass $ 27,094 $ 7,238 $ 7,047 $ 28,868 $ 108,885 $ 151,738 $ 13,070 $ 632 $ 344,572 Special mentions — — — — — — — — — Substandard 88 — — — — 243 — — 331 Total $ 27,182 $ 7,238 $ 7,047 $ 28,868 $ 108,885 $ 151,981 $ 13,070 $ 632 $ 344,903 Gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ — Commercial Pass $ 23,379 $ 25,518 $ 19,739 $ 14,925 $ 29,307 $ 35,202 $ 70,493 $ 1,870 $ 220,433 Special mention 104 27 107 105 76 54 845 — 1,318 Substandard 424 1,055 758 527 — — 1,318 173 4,255 Total $ 23,907 $ 26,600 $ 20,604 $ 15,557 $ 29,383 $ 35,256 $ 72,656 $ 2,043 $ 226,006 Gross charge-offs $ ( 71 ) $ — $ — $ ( 329 ) $ — $ — $ ( 381 ) $ ( 31 ) $ ( 812 ) Consumer Pass $ 7,954 $ 45,750 $ 88,990 $ 39,576 $ 31,597 $ 49,634 $ 769 $ — $ 264,270 Special mention — — 671 — — — — — 671 Substandard 1 29 396 445 41 59 — — 971 Total $ 7,955 $ 45,779 $ 90,057 $ 40,021 $ 31,638 $ 49,693 $ 769 $ — $ 265,912 Gross charge-offs $ ( 451 ) $ ( 99 ) $ ( 1,595 ) $ ( 646 ) $ ( 324 ) $ — $ ( 18 ) $ — $ ( 3,133 ) Total Pass $ 1,316,177 $ 625,423 $ 948,569 $ 540,936 $ 457,235 $ 616,279 $ 230,110 $ 30,333 $ 4,765,062 Special mention 18,928 17,688 34,792 953 76 54 910 — 73,401 Substandard 27,559 19,902 4,261 1,302 324 414 3,383 173 57,318 Total loans by risk category $ 1,362,664 $ 663,013 $ 987,622 $ 543,191 $ 457,635 $ 616,747 $ 234,403 $ 30,506 $ 4,895,781 Total gross charge-offs $ ( 636 ) $ ( 2,739 ) $ ( 1,595 ) $ ( 975 ) $ ( 324 ) $ — $ ( 444 ) $ ( 31 ) $ ( 6,744 ) 18 Table of Contents The following table presents the amortized cost of credit card loans based on performing status and gross charge-offs during the year ended December 31, 2025. Nonperforming loans consisted of nonaccrual loans and loans past due 90 days or more and still accruing. Term Loans by Origination Year Revolving Loans Revolving Converted to Term Loans Total ($ in thousands) Prior 2021 2022 2023 2024 2025 December 31, 2025 Credit cards Performing $ — $ — $ — $ — $ — $ — $ 4,473 $ — $ 4,473 Nonperforming — — — — — — 48 — 48 Total $ — $ — $ — $ — $ — $ — $ 4,521 $ — $ 4,521 Gross charge-offs $ — $ — $ — $ — $ — $ — $ ( 535 ) $ — $ ( 535 ) Total loans evaluated by performing status $ — $ — $ — $ — $ — $ — $ 4,521 $ — $ 4,521 Total gross charge-offs $ ( 636 ) $ ( 2,739 ) $ ( 1,595 ) $ ( 975 ) $ ( 324 ) $ — $ ( 979 ) $ ( 31 ) $ ( 7,279 ) Total recorded investment $ 1,362,664 $ 663,013 $ 987,622 $ 543,191 $ 457,635 $ 616,747 $ 238,924 $ 30,506 $ 4,900,302 The following tables provide information on the aging of the Company’s loan portfolio as of March 31, 2026 and December 31, 2025. ($ 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 March 31, 2026 Commercial real estate $ 761 $ 881 $ — $ 1,183 $ 655 $ 3,480 $ 2,545,892 $ 50,443 $ 2,599,815 Residential real estate 2,272 8 — 3,444 1,207 6,931 1,414,376 4,426 1,425,733 Construction 42 — — 35 126 203 342,632 — 342,835 Commercial 45 — — — — 45 217,946 2,842 220,833 Consumer 239 136 — — 75 450 253,569 459 254,478 Credit cards 71 11 — 17 46 145 4,191 — 4,336 Total $ 3,430 $ 1,036 $ — $ 4,679 $ 2,109 $ 11,254 $ 4,778,606 $ 58,170 $ 4,848,030 Percent of total loans 0.07 % 0.02 % 0.00 % 0.10 % 0.04 % 0.23 % 98.57 % 1.20 % 100.00 % ($ 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 December 31, 2025 Commercial real estate $ 1,684 $ — $ — $ 68 $ 2,741 $ 4,493 $ 2,616,679 $ 22,824 $ 2,643,996 Residential real estate 1,663 397 71 1,225 2,583 5,939 1,402,695 6,330 1,414,964 Construction — 43 79 — 88 210 344,693 — 344,903 Commercial — 4 — 46 150 200 222,921 2,885 226,006 Consumer 390 690 — 43 448 1,571 263,860 481 265,912 Credit cards 14 19 105 32 — 170 4,335 16 4,521 Total $ 3,751 $ 1,153 $ 255 $ 1,414 $ 6,010 $ 12,583 $ 4,855,183 $ 32,536 $ 4,900,302 Percent of total loans 0.08 % 0.02 % 0.01 % 0.03 % 0.12 % 0.26 % 99.08 % 0.66 % 100.00 % 19 Table of Contents The following tables provide a summary of the activity in the ACL allocated by loan class for the three months ended March 31, 2026 and 2025. 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 March 31, 2026 Commercial real estate $ 21,387 $ — $ — $ 285 $ 21,672 Residential real estate 22,510 ( 142 ) 23 602 22,993 Construction 5,968 — — ( 1,162 ) 4,806 Commercial 3,005 ( 203 ) 27 668 3,497 Consumer 5,767 ( 831 ) 356 123 5,415 Credit cards 199 ( 80 ) 3 ( 24 ) 98 Total $ 58,836 $ ( 1,256 ) $ 409 $ 492 $ 58,481 ($ in thousands) Beginning Balance Charge-offs Recoveries Provisions Ending Balance Three Months Ended March 31, 2025 Commercial real estate $ 22,846 $ — $ 78 $ ( 936 ) $ 21,988 Residential real estate 21,776 — 1 616 22,393 Construction 2,854 — 1 987 3,842 Commercial 3,138 ( 2 ) 6 ( 287 ) 2,855 Consumer 6,889 ( 482 ) 86 81 6,574 Credit cards 407 ( 242 ) — 225 390 Total $ 57,910 $ ( 726 ) $ 172 $ 686 $ 58,042 The following tables present the amortized cost basis of collateral-dependent loans by loan portfolio segment as of March 31, 2026 and December 31, 2025. March 31, 2026 ($ in thousands) Real Estate Collateral Other Collateral Total Commercial real estate $ 64,453 $ — $ 64,453 Residential real estate 10,225 — 10,225 Construction 404 — 404 Commercial (1) — 6,658 6,658 Consumer (2) — 533 533 Total $ 75,082 $ 7,191 $ 82,273 December 31, 2025 ($ in thousands) Real Estate Collateral Other Collateral Total Commercial real estate $ 40,676 $ — $ 40,676 Residential real estate 11,084 — 11,084 Construction 332 — 332 Commercial (1) — 4,164 4,164 Consumer (2) — 971 971 Total $ 52,092 $ 5,135 $ 57,227 ____________________________________ (1) Commercial loans are primarily secured by underlying business assets of the borrower. (2) Consumer loans are primarily secured by automobiles and boats of the borrower. 20 Table of Contents Loan Modifications to Borrowers Experiencing Financial Difficulty Loan 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 avoid foreclosure or repossession of collateral. During the three months ended March 31, 2026 and 2025, no loan modifications were made to borrowers experiencing financial difficulty. As of March 31, 2026, of the loans with borrowers experiencing financial difficulty that were modified during the preceding 12 months, $ 5.3 million and $ 164 thousand were classified as current accrual and current nonaccrual, respectively. As of December 31, 2025, of the loans with borrowers experiencing financial difficulty that were modified during the preceding 12 months, $ 5.3 million and $ 170 thousand were classified as current accrual and current nonaccrual, respectively. During the three months ended March 31, 2026 and 2025, there were no defaults on loan modifications made to borrowers experiencing financial difficulty in the preceding 12 months. Foreclosure Proceedings The Company had $ 124 thousand and $ 124 thousand of consumer mortgage loans collateralized by residential real estate property that were in the process of foreclosure as of March 31, 2026 and December 31, 2025, respectively. The Company had $ 151 thousand and $ 95 thousand of commercial real estate loans collateralized by commercial real estate that were in the process of foreclosure as of March 31, 2026 and December 31, 2025, respectively. Other Real Estate Owned (“OREO”) and Repossessed Assets OREO and repossessed assets are adjusted for fair value upon transfer from loans to foreclosed assets, establishing a new cost basis. Subsequently, foreclosed assets are carried at the lower of carrying value or fair value. The Company had OREO and repossessed asset balances of $ 69 thousand and $ 3.3 million as of March 31, 2026 and $ 113 thousand and $ 2.9 million as of December 31, 2025, 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 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 impairments of MSRs were recognized for the three months ended March 31, 2026 or 2025. The Company recognized net servicing income of $ 139 thousand and a net servicing loss of $ 65 thousand for the three months ended March 31, 2026 and 2025, respectively. At March 31, 2026, the Company was servicing $ 334.0 million in loans for the Federal National Mortgage Association and $ 101.8 million in loans for Federal Home Loan Mortgage Corporation. The following table presents activity in MSRs for the three months ended March 31, 2026 and 2025. Three Months Ended March 31, ($ in thousands) 2026 2025 Beginning balance $ 5,142 $ 5,874 Net additions — 43 Amortization expense ( 159 ) ( 52 ) Other — ( 330 ) Ending balance $ 4,983 $ 5,535 The fair value of MSRs were determined using discount rates ranging from 9.0 % to 9.0 % at March 31, 2026 and 9.0 % to 10.0 % at December 31, 2025. The valuation on MSRs was not material at March 31, 2026 and December 31, 2025. Depending on the stratification of the specific mortgage servicing right, prepayment speeds ranged from 5.88 % to 8.60 % for the three months ended March 31, 2026. The associated weighted-average default rate was 0.20 % for the three months ended March 31, 2026. 21 Table of Contents Note 4 – Goodwill and Other Intangible Assets The following tables provide information on the significant components of goodwill and other acquired intangible assets as of March 31, 2026 and December 31, 2025. March 31, 2026 ($ in thousands) Goodwill Core Deposit Intangible Gross carrying amount $ 63,266 $ 59,151 Accumulated amortization — ( 31,409 ) Net carrying amount $ 63,266 $ 27,742 December 31, 2025 ($ in thousands) Goodwill Core Deposit Intangible Gross carrying amount $ 63,266 $ 59,151 Accumulated amortization — ( 29,429 ) Net carrying amount $ 63,266 $ 29,722 The aggregate amortization expense for the core deposit intangible was $ 2.0 million and $ 2.3 million for the three months ended March 31, 2026 and 2025, respectively. As of March 31, 2026, the estimated future remaining amortization for core deposit intangibles within the years ending December 31 is as follows: ($ in thousands) Amortization Expense 2026 $ 5,418 2027 6,208 2028 5,060 2029 3,980 2030 3,096 Thereafter 3,980 Total amortizing intangible assets $ 27,742 22 Table of Contents Note 5 – Leases Right-of-use assets represent the Company’s right to use the underlying asset for the lease term and are calculated as the sum of the lease liability and if applicable, prepaid rent, initial direct costs and any incentives received from the lessor. Lease liabilities represent the Company’s obligation to make lease payments and are presented at each reporting date as the net present value of the remaining contractual cash flows. Cash flows are discounted at the Company’s incremental borrowing rate in effect at the commencement date of the lease. The Company’s long-term lease agreements for branches and offices are classified as operating leases. Certain of these leases offer the option to extend the lease term and the Company has included such extensions in its calculation of the lease liabilities to the extent the options are reasonably certain of being exercised. The lease agreements do not provide for residual value guarantees and have no restrictions or covenants that would impact dividends or require incurring additional financial obligations. The following tables present information about the Company’s leases as of and for the periods presented. ($ in thousands) March 31, 2026 December 31, 2025 Right-of-use assets $ 10,102 $ 10,523 Lease liabilities $ 10,608 $ 11,027 Weighted-average remaining lease term 8.80 years 8.91 years Weighted-average discount rate 3.40 % 3.42 % Remaining lease term – min 0.12 years 0.36 years Remaining lease term – max 15.43 years 15.68 years Three Months Ended March 31, ($ in thousands) 2026 2025 Operating lease cost $ 512 $ 492 Total lease cost $ 512 $ 492 Cash paid for amounts included in the measurement of lease liabilities $ 509 $ 467 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 March 31, 2026. ($ in thousands) March 31, 2026 2026 $ 1,511 2027 1,869 2028 1,779 2029 1,354 2030 997 Thereafter 4,578 Total undiscounted cash flows 12,088 Less: imputed interest 1,480 Lease liabilities $ 10,608 Total gross rental income was $ 306 thousand and $ 335 thousand for the three months ended March 31, 2026 and 2025, respectively. 23 Table of Contents Note 6 – Deposits Deposits consist of the following categories as of the dates indicated: ($ in thousands) March 31, 2026 December 31, 2025 Balance % of Total Deposits Balance % of Total Deposits Noninterest-bearing deposits $ 1,567,425 28.70 % $ 1,587,953 28.69 % Interest-bearing deposits: Interest-bearing checking 812,847 14.88 852,585 15.41 Money market and savings 1,795,619 32.88 1,814,928 32.80 Time deposits 1,274,766 23.34 1,267,487 22.90 Brokered deposits 10,963 0.20 10,911 0.20 Total interest-bearing 3,894,195 71.30 3,945,911 71.31 Total deposits $ 5,461,620 100.00 % $ 5,533,864 100.00 % The following table provides information on the approximate maturities of total time deposits at March 31, 2026. ($ in thousands) March 31, 2026 Within one year $ 1,171,773 Year 2 76,182 Year 3 14,391 Year 4 5,191 Year 5 7,229 Thereafter — Total $ 1,274,766 The approximate amount of certificates of deposit that exceeded the FDIC insurance limit of $250,000 or more was $ 406.7 million and $ 403.5 million at March 31, 2026 and December 31, 2025, respectively. 24 Table of Contents Note 7 – Borrowings The following table summarizes certain information of the Company’s long-term debt as of March 31, 2026 and December 31, 2025. ($ in thousands) March 31, 2026 December 31, 2025 Issue Date Stated Maturity Date Earliest Call Date Interest Rate Subordinated Debentures due November 2035 60,000 60,000 2025 2035 2030 6.25 % through November 2030, 3-month SOFR + 2.88 % thereafter Total subordinated debentures 60,000 60,000 Severn Capital Trust I 20,619 20,619 2004 2035 3-month SOFR + 2.26 % Tri-County Capital Trust I 7,217 7,217 2004 2034 3-month SOFR + 2.86 % Tri-County Capital Trust II 5,155 5,155 2005 2035 3-month SOFR + 1.96 % Total trust preferred securities 32,991 32,991 Less: net discount and unamortized issuance costs ( 3,962 ) ( 3,930 ) Total long-term debt $ 89,029 $ 89,061 At March 31, 2026, subordinated debentures consisted of $ 60.0 million of long-term debt issued by the Company in November 2025. As of March 31, 2026, the recorded balance of subordinated debt issued by the Company, net of unamortized issuance costs and fair value discounts, was $ 58.8 million. The Company has the option to redeem the subordinated notes in part or whole as of November 15, 2030. As of March 31, 2026, 100 % 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 March 31, 2026 was $ 19.0 million, net of the unamortized fair value adjustment of $ 1.6 million. At March 31, 2026, 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 $ 489 thousand and $ 644 thousand, respectively. As of March 31, 2026, 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. The Company had no outstanding borrowings from the FHLB at March 31, 2026 and December 31, 2025. The Company did not have any correspondent federal fund lines at March 31, 2026 and December 31, 2025. Further information on these obligations is provided in the Company’s 2025 A nnual Report. 25 Table of Contents Note 8 – Derivatives The Company maintains and accounts for derivatives, in the form of interest rate lock commitments (“IRLCs”) and mandatory forward contracts, in accordance with the FASB guidance on accounting for derivative instruments and hedging activities. The Company recognizes gains and losses through mortgage banking revenue in the consolidated statements of income. 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 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 as of March 31, 2026 and December 31, 2025. March 31, 2026 December 31, 2025 ($ in thousands) Notional Amount Estimated Fair Value Notional Amount Estimated Fair Value Asset – IRLCs $ 12,816 $ 147 $ 6,172 $ 91 Asset – TBA securities 31,050 310 9,750 11 Liability – IRLCs 1,366 8 193 1 Liability – TBA securities 16,500 56 20,150 59 Note 9 – Accumulated Other Comprehensive Loss 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 months ended March 31, 2026 and 2025. Three Months Ended ($ in thousands) March 31, 2026 March 31, 2025 Beginning of period $ ( 4,593 ) $ ( 7,545 ) Other comprehensive income (loss), net of tax ( 677 ) 1,212 End of period $ ( 5,270 ) $ ( 6,333 ) Note 10 – Regulatory Capital Requirements Banks and bank holding companies are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory – and possibly additional discretionary – actions by regulators that, if undertaken, could have a direct material effect on the financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action (“PCA”), the Bank must meet specific capital guidelines that involve quantitative measures of the Bank’s assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. 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 March 31, 2026 and December 31, 2025, management believes that the Company and the Bank met all capital adequacy requirements to which they were subject. As of March 31, 2026, the most recent notification from the Bank’s primary regulator categorized the Bank, as “well-capitalized” under the regulatory framework for PCA. 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 March 31, 2026 and December 31, 2025. 26 Table of Contents March 31, 2026 Amount Regulatory Minimum Ratio + Capital Conservation Buffer To Be Well-Capitalized Under PCA Regulation (1) ($ in thousands) Company Amounts Common Equity Tier 1 Capital $ 525,849 $ 335,606 N/A Tier 1 Capital 556,096 407,522 N/A Total Capital 674,811 503,409 N/A Leverage Exposure 6,098,196 243,928 N/A Risk-Weighted Assets 4,794,374 N/A N/A Company Ratios Common Equity Tier 1 Capital to Risk-Weighted Assets (“RWA”) 10.97 % 7.00 % N/A Tier 1 Capital to RWA 11.60 8.50 N/A Total Capital to RWA 14.08 10.50 N/A Tier 1 Capital to AA (Leverage) (2) 9.12 4.00 N/A Bank Amounts Common Equity Tier 1 Capital $ 583,733 $ 335,386 $ 311,429 Tier 1 Capital 583,733 407,254 383,298 Total Capital 643,627 503,078 479,122 Leverage Exposure 6,093,905 243,756 304,695 Risk-Weighted Assets 4,791,223 N/A N/A Bank Ratios Common Equity Tier 1 Capital to RWA 12.18 % 7.00 % 6.50 % Tier 1 Capital to RWA 12.18 8.50 8.00 Total Capital to RWA 13.43 10.50 10.00 Tier 1 Capital to AA (Leverage) (2) 9.58 4.00 5.00 ____________________________________ (1) Applies to the Bank only. (2) Tier 1 Capital to Average Assets (Leverage) has no capital conservation buffer defined. The PCA well-capitalized threshold is defined as 5.00 %. 27 Table of Contents December 31, 2025 Amount Regulatory Minimum Ratio + Capital Conservation Buffer To Be Well-Capitalized Under PCA Regulation (1) ($ in thousands) Company Amounts Common Equity Tier 1 Capital $ 510,729 $ 339,680 N/A Tier 1 Capital 540,897 412,469 N/A Total Capital 660,451 509,520 N/A Leverage Exposure 6,129,306 245,172 N/A Risk-Weighted Assets 4,852,573 N/A N/A Company Ratios Common Equity Tier 1 Capital to RWA 10.52 % 7.00 % N/A Tier 1 Capital to RWA 11.15 8.50 N/A Total Capital to RWA 13.61 10.50 N/A Tier 1 Capital to AA (Leverage) (2) 8.82 4.00 N/A Bank Amounts Common Equity Tier 1 Capital $ 569,183 $ 339,125 $ 314,902 Tier 1 Capital 569,183 411,794 387,571 Total Capital 629,746 508,687 484,464 Leverage Exposure 6,122,775 244,911 306,139 Risk-Weighted Assets 4,844,639 N/A N/A Bank Ratios Common Equity Tier 1 Capital to RWA 11.75 % 7.00 % 6.50 % Tier 1 Capital to RWA 11.75 8.50 8.00 Total Capital to RWA 13.00 10.50 10.00 Tier 1 Capital to AA (Leverage) (2) 9.30 4.00 5.00 _________________________________ (1) Applies to the Bank only. (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 March 31, 2026, both the Company and the Bank satisfied the capital conservation buffer requirements applicable to them. The lowest capital buffer ratio at the Company was the Tier 1 Capital to RWA, which was 5.60 % above the minimum capital conservation buffer ratio requirement, and the lowest capital buffer ratio at the Bank was the Total Capital to RWA, which was 5.43 % above the minimum capital conservation buffer ratio requirement. The Company is a separate legal entity from the Bank and must provide for its own liquidity. In addition to its operating expenses, the Company is responsible for paying any dividends declared to its common stockholders and interest and principal on outstanding debt. The Company’s primary source of income is dividends received from the Bank. 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 OCC, cannot exceed net income for that year to date plus retained net income (as defined) for the preceding two calendar years. As of March 31, 2026, the Bank could pay dividends to the Company to the extent of its current period earnings plus the earnings of the preceding two years, so long as it maintained required capital ratios. 28 Table of Contents Note 11 – Fair Value Measurements Accounting guidance under GAAP defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. This accounting guidance also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities on a recurring basis and to determine fair value disclosures. Available for sale securities and equity securities with readily determinable fair values are recorded at fair value on a recurring basis, along with other mortgage-related items identified in the recurring fair value table below. Additionally, from time to time, the Company may be required to record at fair value other assets on a nonrecurring basis, such as collateral-dependent loans, repossessed assets and OREO (foreclosed assets). These non-recurring fair value adjustments typically involve application of lower of cost or market accounting or write-downs of individual assets. Under fair value accounting guidance, assets and liabilities are grouped at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine their fair values. These hierarchy levels are: • Level 1 inputs – Unadjusted quoted prices in active markets for identical assets or liabilities that the entity has the ability to access at the measurement date. • Level 2 inputs – Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals. • Level 3 inputs – Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities. Assets Measured at Fair Value on a Recurring Basis Available for Sale Securities Fair value measurement of AFS securities is based on quoted prices from an independent pricing service. The fair value measurements consider observable data that may include present value of future cash flows, prepayment assumptions, credit loss assumptions and other factors. The Company classifies its investments in U.S. Treasury securities, if any, as Level 1 in the fair value hierarchy, and it classifies its investments in U.S. government agency securities and mortgage-backed securities issued or guaranteed by U.S. government-sponsored entities as Level 2. Equity Securities Fair value measurement for equity securities is based on quoted market prices retrieved by the Company via online resources. Although these securities have readily available fair market values, the Company determined that they should be classified as Level 2 investments in the fair value hierarchy due to not being considered traded in a highly active market. Loans Held for Sale 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). IRLCs 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). March 31, 2026 ($ in thousands) Fair Value Valuation Technique Unobservable Input Rate IRLCs – net asset $ 139 Market approach Range of pull through rate 79 % - 100 % Average pull through rate 92 % 29 Table of Contents December 31, 2025 ($ in thousands) Fair Value Valuation Technique Unobservable Input Rate IRLCs – net asset $ 90 Market approach Range of pull through rate 81 % - 100 % Average pull through rate 98 % The following table presents activity in the IRLCs – net asset for the three months ended March 31, 2026 and 2025. Three Months Ended March 31, ($ in thousands) 2026 2025 Beginning balance $ 90 $ 113 Valuation adjustment 49 279 Ending balance $ 139 $ 392 Forward Contracts To manage 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 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. 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 forward contracts may be subject to investor overlays that may result in a significantly lower fair value measurement. Generally such overlays are announced with advanced notice in order to include the risk adjuster, however there are times when announcements are mandated resulting in a lower fair value measurement. 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. 30 Table of Contents The following tables present the recorded amounts of assets and liabilities measured at fair value on a recurring basis as of March 31, 2026 and December 31, 2025. No assets or liabilities were transferred from one hierarchy level to another during the three months ended March 31, 2026 or 2025. March 31, 2026 ($ in thousands) Fair Value Quoted Prices (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Available for sale securities: U.S. government agency securities $ 20,364 $ — $ 20,364 $ — Mortgage-backed securities 230,676 — 230,676 — Other debt securities 12,986 — 12,986 — Total available for sale securities 264,026 — 264,026 — Equity securities 6,195 — 6,195 — TBA forward trades 310 — 310 — Loans held for sale 24,034 — 24,034 — IRLCs 147 — — 147 Total assets at fair value $ 294,712 $ — $ 294,565 $ 147 Liabilities: IRLCs $ 8 $ — $ — $ 8 TBA forward trades 56 — 56 — Total liabilities at fair value $ 64 $ — $ 56 $ 8 December 31, 2025 ($ in thousands) Fair Value Quoted Prices (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Available for sale securities: U.S. government agency securities $ 20,616 $ — $ 20,616 $ — Mortgage-backed securities 195,027 — 195,027 — Other debt securities 4,715 — 4,715 — Total available for sale securities 220,358 — 220,358 — Equity securities 6,186 — 6,186 — TBA forward trades 11 — 11 — Loans held for sale 32,540 — 32,540 — IRLCs 91 — — 91 Total assets at fair value $ 259,186 $ — $ 259,095 $ 91 Liabilities: IRLCs $ 1 $ — $ — $ 1 TBA forward trades 59 — 59 — Total liabilities at fair value $ 60 $ — $ 59 $ 1 31 Table of Contents Assets Measured at Fair Value on a Non-recurring Basis Individually Evaluated Collateral-Dependent Loans Loans for which repayment is substantially expected to be provided through the operation or sale of collateral are considered collateral dependent and are valued based on the estimated fair value of the collateral, less estimated costs to sell at the reporting date, where applicable. Management utilizes various methods to estimate fair value of the collateral including appraisals, discounted cashflow and automated valuation methods. Accordingly, collateral-dependent loans are classified within Level 3 of the fair value hierarchy. OREO (Foreclosed Assets) Foreclosed assets are adjusted for fair value upon transfer of loans to foreclosed assets establishing a new cost basis. Subsequently, foreclosed assets are carried at the lower of carrying value or fair value. The estimated fair value for foreclosed assets included in Level 3 is determined by independent market-based appraisals and other available market information, less costs to sell, that may be reduced further based on market expectations or an executed sales agreement. If the fair value of the collateral deteriorates subsequent to the initial recognition, the Company records the foreclosed asset as a non-recurring Level 3 adjustment. Valuation techniques are consistent with those techniques applied in prior periods. Repossessed Assets All repossessed assets are recorded at the lower of the estimated fair value of the properties, less expected selling costs, or the carrying amount of the defaulted loans. From time to time, non-recurring fair value adjustments are recorded to reflect partial write-downs based on the current appraised value of an asset. The Company considers any valuation inputs related to repossessed assets to be Level 3 inputs. Fair value adjustments for these assets are recorded in other noninterest expense in the consolidated statements of income. Other Assets Held for Sale Other assets held for sale are carried at the lower of the carrying amount or fair value. The fair value is determined based on the appraisal value, listing price of the property or collateral provided by independent appraisers, and is adjusted for the estimated costs to sell. Due to the use of significant unobservable inputs, these assets are classified as Level 3 under the fair value hierarchy. 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 non-recurring basis as of March 31, 2026 and December 31, 2025 that are valued at the 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. Quantitative Information about Level 3 Fair Value Measurements ($ in thousands) Fair Value Valuation Technique (1) Unobservable Input (2) Range Weighted-Average March 31, 2026 Non-recurring measurements: Individually-evaluated collateral dependent loans: Commercial real estate $ 6,623 Appraisal of collateral Appraisal adjustment Liquidation expense 70 % 10 % 70 % 10 % Residential real estate 625 Appraisal of collateral Appraisal adjustment Liquidation expense 50 % - 100 % 10 % 52 % 10 % Other real estate owned 69 Appraisal of collateral Appraisal adjustment N/A 0 % Repossessed assets 3,344 Appraisal of collateral Appraisal adjustment N/A 9 % 32 Table of Contents Quantitative Information about Level 3 Fair Value Measurements ($ in thousands) Fair Value Valuation Technique (1) Unobservable Input (2) Range Weighted-Average December 31, 2025 Nonrecurring measurements: Individually-evaluated collateral dependent loans: Commercial real estate $ 19,696 Appraisal of collateral Appraisal adjustment Liquidation expense 60 % - 71 % 10 % 68 % 10 % Residential real estate 520 Appraisal of collateral Appraisal adjustment Liquidation expense 0 % - 1 % 10 % 1 % 10 % Other real estate owned 113 Appraisal of collateral Appraisal adjustment N/A 0 % Repossessed assets 2,879 Appraisal of collateral Appraisal adjustment N/A 60 % _________________________________ (1) Unobservable inputs were weighted by the relative fair value of the instruments. No range is presented only when one instrument was available. (2) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range of liquidation expenses and other appraisal adjustments are presented as a percent of the appraisal. 33 Table of Contents Note 12 – Fair Value of Financial Instruments Financial instruments require disclosure of fair value information, whether or not recognized in the consolidated balance sheets, when it is practical to estimate the fair value. A financial instrument is defined as cash, evidence of an ownership interest in an entity or a contractual obligation which requires the exchange of cash. Certain items are specifically excluded from the financial instrument fair value disclosure requirements, including the Company’s common stock, OREO, repossessed assets, 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 March 31, 2026 and December 31, 2025. Fair values for March 31, 2026 and December 31, 2025 were estimated using an exit price notion. Carrying Amount Fair Value Fair Value Measurements ($ in thousands) Level 1 Level 2 Level 3 March 31, 2026 Assets Cash and cash equivalents $ 340,822 $ 340,822 $ 340,822 $ — $ — Available for sale securities 264,026 264,026 — 264,026 — Held to maturity securities 393,615 356,390 — 356,390 — Equity securities 6,195 6,195 — 6,195 — Restricted securities 18,003 N/A — N/A — Loans held for sale 24,034 24,034 — 24,034 — TBA securities 310 310 — 310 — Loans held for investment, at amortized cost, net 4,789,549 4,730,092 — — 4,730,092 Mortgage servicing rights 4,983 5,716 — 5,716 — Accrued interest receivable 20,676 20,676 — 20,676 — IRLCs 147 147 — — 147 Liabilities Deposits: Noninterest-bearing $ 1,567,425 $ 1,567,425 $ — $ 1,567,425 $ — Interest-bearing checking 812,847 812,847 — 812,847 — Money market and savings 1,795,619 1,795,619 — 1,795,619 — Time deposits 1,274,766 1,272,334 — 1,272,334 — Brokered deposits 10,963 10,964 — 10,964 — TRUPS 30,247 30,939 — 30,939 — Subordinated debt 58,782 60,079 — 60,079 — TBA Securities 56 56 — 56 — Accrued interest payable 3,909 3,909 — 3,909 — IRLCs 8 8 — — 8 34 Table of Contents Carrying Amount Fair Value Fair Value Measurements ($ in thousands) Level 1 Level 2 Level 3 December 31, 2025 Assets Cash and cash equivalents $ 355,566 $ 355,566 $ 355,566 $ — $ — Available for sale securities 220,358 220,358 — 220,358 — Held to maturity securities 414,827 378,116 — 378,116 — Equity securities 6,186 6,186 — 6,186 — Restricted securities 17,989 N/A — N/A — Loans held for sale 32,540 32,540 — 32,540 — TBA securities 11 11 — 11 — Loans held for investment, at amortized cost, net 4,841,466 4,767,143 — — 4,767,143 Mortgage servicing rights 5,142 5,861 — 5,861 — Accrued interest receivable 18,551 18,551 — 18,551 — IRLCs 91 91 — — 91 Liabilities Deposits: Noninterest-bearing $ 1,587,953 $ 1,587,953 $ — $ 1,587,953 $ — Interest bearing checking 852,585 852,585 — 852,585 — Money market and savings 1,814,928 1,814,928 — 1,814,928 — Time deposits 1,267,487 1,265,740 — 1,265,740 — Brokered deposits 10,911 10,923 — 10,923 — TRUPS 30,168 29,586 — 29,586 — Subordinated debt 58,893 58,064 — 58,064 — TBA securities 59 59 — 59 — Accrued interest payable 2,977 2,977 — 2,977 — IRLCs 1 1 — — 1 35 Table of Contents Note 13 – Commitments and Contingencies In the normal course of business, to meet the financial needs of its customers, the Company is a party to financial instruments with off-balance sheet risk. These financial instruments include commitments to extend credit and standby letters of credit. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. Letters of credit and other commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Because many of the letters of credit and commitments are expected to expire without being drawn upon, the total commitment amount does not necessarily represent future cash requirements. Commitments to make loans are generally made for a period of 90 days or less. The following table provides information on commitments outstanding as of March 31, 2026 and December 31, 2025. ($ in thousands) March 31, 2026 December 31, 2025 Commitments to extend credit Fixed $ 233,298 $ 209,737 Variable 472,740 503,713 Total commitments to extend credit $ 706,038 $ 713,450 Letters of credit Fixed $ 5,951 $ 6,495 Variable 17,702 17,830 Total letters of credit $ 23,653 $ 24,325 Total commitments outstanding $ 729,691 $ 737,775 The Company had a reserve for off-balance sheet credit exposures of $ 1.7 million and $ 2.0 million as of March 31, 2026 and December 31, 2025, respectively. The reserve was estimated based on current expected credit losses to be experienced by the Company. Losses are charged against the allowance when management believes the required funding of these exposures is uncollectible. While this evaluation is completed on a regular basis, it is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. In the normal course of business, the Company may become involved in litigation arising from banking, financial and other activities. Management, after consultation with legal counsel, does not anticipate that the future liability, if any, arising out of current proceedings will have a material effect on the Company’s financial condition, operating results or liquidity. 36 Table of Contents Note 14 – Earnings per Common Share Basic 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. 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 March 31, 2026 and 2025. Three Months Ended March 31, ($ in thousands, except per share data) 2026 2025 Net income $ 17,088 $ 13,764 Average number of common shares outstanding 33,428,444 33,350,869 Dilutive effect of common stock equivalents 19,323 24,449 Average number of common shares used to calculate diluted EPS 33,447,767 33,375,318 Anti-dilutive shares — 6,515 Basic net income per common share $ 0.51 $ 0.41 Diluted net income per common share $ 0.51 $ 0.41 There were zero and 6,515 anti-dilutive unvested restricted stock and performance stock unit awards excluded from the calculation of diluted earnings per common share for the three months ended March 31, 2026 and 2025, respectively. Note 15 – Revenue Recognition 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 Service charges on deposit accounts consist of account analysis fees (i.e., net fees earned on analyzed business and public checking accounts), monthly service fees, check orders, and other deposit account related fees. The Company’s performance obligation for account analysis fees and monthly service fees is generally satisfied, and the related revenue recognized, over the period in which the service is provided. Check orders and other deposit account-related fees are largely transactional based, and therefore, the Company’s performance obligation is satisfied, and related revenue recognized, at a point in time. Payment for service charges on deposit accounts is primarily received immediately or at the end of the month through a direct charge to customers’ accounts. Trust and Investment Fee Income Trust and investment fee income is primarily comprised of fees earned from the management and administration of trusts and other customer assets. The Company’s performance obligation is generally satisfied over time, and the resulting fees are recognized monthly, based upon the month-end market value of the assets under management and the applicable fee rate. Payment is generally received a few days after month end through a direct charge to customers’ accounts. The Company does not earn performance-based incentives. Optional services such as real estate sales and tax return preparation services are also available to existing trust and asset management customers. The Company’s performance obligation for these transactional-based services is generally satisfied, and related revenue recognized, at a point in time (i.e., as incurred). Payment is received shortly after services are rendered. Interchange Income Interchange fees is primarily fees earned on payment card transactions processed through card networks such as Visa, Mastercard, and other debit and credit card networks. These fees are generally calculated as a percentage of the transaction value, plus a fixed fee per transaction, and are primarily paid by acquiring banks to issuing banks. Merchant services income mainly represents fees charged to merchants to process their debit and credit card transactions, in addition to account management fees. 37 Table of Contents Other Noninterest Income Other noninterest income consists of fees, other service charges, safety deposit box rental fees, and other miscellaneous revenue streams. Fees and other service charges are primarily comprised of debit income, automated teller machine (“ATM”) fees, merchant services income, and other service charges. ATM fees are primarily generated when a Company cardholder uses a third-party ATM or a non-Company cardholder uses a Company ATM. Other service charges include revenue from processing wire transfers, bill pay service, cashier’s checks, and other services. The Company’s performance obligation for fees, exchange, and other service charges are largely satisfied, and related revenue recognized, when the services are rendered or upon completion. Payment is typically received immediately or in the following month. Safe deposit box rental fees are charged to the customer on an annual basis and recognized upon receipt of payment. The following presents noninterest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the three months ended March 31, 2026 and 2025. Three Months Ended March 31, ($ in thousands) 2026 2025 Noninterest income In-scope of Topic 606: Service charges on deposit accounts $ 1,596 $ 1,514 Trust and investment fee income 1,137 823 Interchange income 1,698 1,577 Other noninterest income 958 857 Noninterest income (in-scope of Topic 606) 5,389 4,771 Noninterest income (out-of-scope of Topic 606) 1,855 2,363 Total noninterest income $ 7,244 $ 7,134 38 Table of Contents