HBT 10-K & 10-Q changes, risk factors and insider trading

Commercial and commercial real estate loans, including multi-family loans, are often larger and may involve greater risks than some other types of lending. Because payments on such loans are often dependent on the successful operation or development of the property or business involved, repayment of such loans is often more sensitive than other types of loans to adverse conditions in the real estate market or the general business climate and economy. Accordingly, a downturn in the real estate market or a challenging business and economic environment, including those which disproportionately affect a class of borrower, may increase our risk associated with our loan portfolio. Unlike residential mortgage loans, which generally are made on the basis of the borrowers’ ability to make repayment from their employment and other income and which are secured by real property whose value tends to be more easily ascertainable, commercial loans typically are made on the basis of the borrowers’ ability to make repayment from the cash flow of the commercial venture. Economic events, including decreases in office occupancy following the COVID-19 pandemic as a result of the shift to remote and hybrid work environments, or governmental regulations outside of our control or the control of the borrower could negatively impact the future cash flow and market values of the affected properties. Our commercial operating loans are primarily made based on the identified cash flow of the borrower and secondarily on the collateral underlying the loans. Most often, this collateral consists of accounts receivable, inventory and equipment. Inventory and equipment may depreciate over time, may be difficult to appraise and may fluctuate in value based on the success of the business. If the cash flow from business operations is reduced, the borrower’s ability to repay the loan may be impaired. Due to the larger average size of each commercial loan as compared with other loans such as residential loans, as well as collateral that is generally less readily-marketable, losses incurred on a small number of commercial or commercial real estate loans could have a material adverse impact on our financial condition and results of operations.

•the impact of government policies and regulations (including changes in price supports, tariffs, trade policy, subsidies, government-sponsored crop insurance, minimum ethanol content requirements for gasoline, tariffs, trade barriers and health and environmental regulations);

Additionally, elevated interest rates or an increase in interest rates may, among other things, reduce the demand for loans, increase the cost of deposit and wholesale funding, reduce our ability to originate loans and decrease prepayments on our loan and securities portfolio. Conversely, a decrease in the general level of interest rates may, among other things, decrease our net interest margin and increase prepayments on our loan and securities portfolios. Although our asset-liability management strategy is designed to control and mitigate exposure to the risks related to changes in market interest rates, those rates are affected by many factors outside of our control, including governmental monetary policies, inflation, deflation, recession, changes in unemployment, the money supply, international disorder and instability in domestic and foreign financial markets.

An increase in market interest rates may affect the fair value of our securities portfolio, potentially reducing accumulated other comprehensive income or earnings. The fair value of these investments may also be affected by factors other than the underlying performance of the issuer of the securities or the mortgages underlying the securities, such as negative trends in the residential and commercial real estate markets, ratings downgrades, adverse changes in the business climate and a lack of liquidity for certain investment securities. In addition, we may sell securitiesdebt in our available-for-sale investment securities portfolio,securities, and any such sale could cause us to realize currently unrealized losses that resulted from increases in the prevailing interest rates.

Beginning in March 2022, the Federal Open Market Committee of the Federal Reserve (the "FOMC") made a series of significant increases to the federal funds target range as part of an effort to combat elevated levels of inflation affecting the U.S. economy. While the significant increase in prevailing interest rates increased our net interest income, it also led to increased losses in our available-for-sale debt securities portfolio. Since 2022, the magnitude of ourthese losses on debt securities have partially reversed with net unrealized losses on debt securities available-for-sale haveof partially$28.8 reversedmillion and werenet $59.4unrecognized losses on debt securities held-to-maturity of $31.9 million as of December 31, 2024.2025.

It is currently expected that during 2025, and perhaps beyond, the FOMC may decrease interest rates. In September 2024, the FOMC began lowering interest rates with the target range for the federal funds rate decreasing by 100 basis points to a range of 4.25% to 4.50% by the end of 2024. The decrease was expressly made in response to inflation moderating and the labor market weakening. Any future change in monetary policy by the FOMC, in an effort to stimulate the economy or otherwise, resulting in lower interest rates would likely result in lower revenue through lower net interest income over time, which could adversely affect our results of operations. These effects from interest rate changeschanges, a perceived lack of independence by the FOMC from political pressure to set monetary policy, or from other sustained economic stress or a recession, among other matters, could have a material adverse effect on our business, financial condition, liquidity, and results of operations.

Given the complex factors affecting the strength of the U.S. economy, including uncertainties regarding the persistence of inflation; record-highsustained elevated levels of U.S. credit card debt; the implementation of policies proposed by the newcurrent presidential administration; and geopolitical developments, such as future terrorist attacks and threats, widespread disease or pandemics, and acts of war including the Russian invasion of Ukraine and ongoingUkraine, conflicts in the Middle East,East and recent military activity in Venezuela, there is a meaningful risk that the Federal Reserve and other central banks may maintain interest rates at elevated levels, which may negatively impact the entire national economy. This could decrease loan demand, harm the credit characteristics of our existing loan portfolio and decrease the value of collateral securing loans in the portfolio.

In addition to our deposit base, our liquidity is provided by cash from operations and investment maturities, redemptions and sales as well as cash flow from loan prepayments and maturing loans that are not renewed. When needed, additional liquidity may be available by borrowing from the Federal Reserve Bank of Chicago or the Federal Home Loan Bank of Chicago (the "FHLB"), through federal funds lines with our correspondent banks, and through other wholesale funding sources including brokered deposits. Our access to funding sources in amounts adequate to finance or capitalize our activities or on terms that are acceptable to us could be impaired by factors that affect us directly or the financial services industry or economy in general, such as disruptions in the financial markets or negative views and expectations about the prospects for the financial services industry. In addition, increased competition with other banks and FinTechsfintechs for retail deposits may impact our ability to raise funds through deposits and could have a negative effect on our liquidity. For example, as customer deposit levels have decreased over the past two years, we have observed that the sensitivity of market deposit rates to changes in prevailing interest rates has increased.

The widespread adoption of new technologies, including internetdigital services, cryptocurrenciesassets and payment systems, could require us in the future to make substantial expenditures to modify or adapt our existing products and services as we grow and develop new products to satisfy our customers’ expectations and comply with regulatory guidance.

Changes in policy and at banking agencies, including changes in interpretation and prioritization, occur over time through policy and personnel changes following federal and state-level elections, which lead to changes involving the level of oversight and focus on the financial services industry. The nature, timing and economic and political effects of potential changes to the current legal and regulatory framework affecting financial institutions remain highly uncertain in connection with a change in presidential administration.uncertain. Given the complex factors affecting the strength of the U.S. economy, including uncertainties regarding the persistence of inflation, geopolitical developments such as ongoing conflicts in the Middle East andEast, the Russian invasion of Ukraine,Ukraine and recent military activity in Venezuela, and resulting disruptions in the global energy market, tight labor market conditions domestically, supply chain issues both domestically and internationally and the potential effects of apolicies newfrom the current presidential administration, including its response to the foregoing, potential imposition of new tariffs, massimmigration deportationsenforcement and changes to tax or other financial regulations, uncertainty surrounding future changes may adversely affect our operating environment and therefore our business, financial condition, results of operations and growth prospects.

In addition to the enactment of the Dodd-Frank Act, various state and local legislative bodies have adopted or have been considering augmenting their existing framework governing consumers’ rights. These considerations could also be impacted by the recent changes in federal administration. Such legislative or regulatory changes to consumer financial laws and regulations could result in changes to our pricing, practices, products and procedures; increases in our costs related to regulatory oversight, supervision and examination; or result in remediation efforts and possible penalties. We may be required to add additional compliance personnel or incur other significant compliance-related expenses to meet the demands of these consumer protection laws. We cannot predict whether new legislation or regulation will be enacted and, if enacted, the effect that it would have on our activities, financial condition, or results of operations.

The CRA requires the Bank, consistent with safe and sound operations, to ascertain and meet the credit needs of their entire communities, including lowlow- and moderate incomemoderate-income areas. The Bank’s failure to comply with the CRA could, among other things, result in the denial or delay of certain corporate applications filed by us or the Bank, including applications for branch openings or relocations and applications to acquire, merge or consolidate with another banking institution or holding company. In addition, the Equal Credit Opportunity Act, the Fair Housing Act and other fair lending laws and regulations prohibit discriminatory lending practices by financial institutions. The U.S. Department of Justice, federal banking agencies, and other federal agencies are responsible for enforcing these laws and regulations. A challenge to an institution’s compliance with fair lending laws and regulations could result in a wide variety of sanctions, including damages and civil money penalties, injunctive relief, restrictions on mergers and acquisitions activity, restrictions on expansion, and restrictions on entering new business lines. Private parties may also challenge an institution’s performance under fair lending laws in private class action litigation. Such actions could have a material adverse effect on our business, financial condition, results of operations and growth prospects. See "Supervision and Regulation—Supervision and Regulation of the Bank—Community Reinvestment Act Requirements".

TheExecutive Order 14370, "Increasing Medical Marijuana and Cannabidiol Research," directs federal agencies to work towards rescheduling marijuana from Schedule I to Schedule III under the Controlled Substances ActAct. The executive order does not change cannabis's legal status under the Controlled Substances Act, which makes it illegal under federal law to manufacture, distribute, or dispense marijuana. Starting January 1, 2020, however,However, the Illinois Cannabis Regulation and Tax Act began permittingpermits adults 21 years or older to legally purchase marijuana for recreational use from licensed dispensaries. It is the Bank’s current practice to avoid knowingly providing banking products or services to entities or individuals that directly manufacture, distribute, or dispense marijuana or hemp products, or those with a significant financial interest in such entities. The Bank uses reasonable measures, including appropriate new account screening and customer due diligence measures, to ensure that existing and potential customers that operate in the states in which the Bank operates do not engage in any such activities. Nonetheless, shiftsthe instate-level Illinoislegalization law legalizingof cannabis use havehas increased the number of direct and indirect cannabis-related businesses in Illinois, and therefore increasesincreased the likelihood that the Bank could interact with such businesses, as well as their owners and employees. Such interactions could create additional legal, regulatory, strategic, and reputational risk to the Bank and the Company.

From time to time, the FASB and the SEC change the financial accounting and reporting standards or the interpretation of those standards that govern the preparation of our external financial statements. In addition, trends in financial and business reporting, including environmental social and governance (“ESG”) related disclosures,reporting could require us to incur additional reporting expense. These changes are beyond our control, can be difficult to predict and could materially impact how we report our financial condition and results of operations.

These anti-takeover provisions and other provisions under Delaware law could discourage, delay or prevent a transaction involving a change in control of the Company, even if doing so would benefit our stockholders. These provisions could also discourage proxy contests and make it more difficult for you and other stockholders to elect directors of your choosing and to cause us to take other corporate actions you desire.

Unfavorable market conditions can result in a deterioration in the credit quality of our borrowers and the demand for our products and services, an increase in the number of loan delinquencies, defaults and charge-offs, additional provisions for credit losses, adverse asset values and an overall material adverse effect on the quality of our loan portfolio. Unfavorable or uncertain economic and market conditions can be caused by, among other factors, declines in economic growth, business activity or investor or business confidence; limitations on the availability or increases in the cost of credit and capital; changes in inflation or interest rates; increases in real estate and other state and local taxes; high unemployment; natural disasters; pandemics; climate change; acts of terrorism or war (including conflicts in the Israeli-PalestinianMiddle conflict andEast, the Russian invasion of Ukraine and recent military activity in Venezuela); or a combination of these or other factors.

Continued elevatedElevated levels of inflation could adversely impact our business and results of operations.

The United States has recently experienced elevated levels of inflation. ContinuedElevated levels of inflation could have complex effects on our business and results of operations, some of which could be materially adverse. For example, elevated inflation harms consumer purchasing power, which could negatively affect our retail customers and the economic environment and, ultimately, many of our business customers, and could also negatively affect our levels of non-interest expense. In addition, if interest rates were to rise in response to elevated levels of inflation, the value of our securities and loan portfolios may be negatively impacted. Continued elevatedElevated levels of inflation could also cause increased volatility and uncertainty in the business environment, which could adversely affect loan demand and our clients’ ability to repay indebtedness. It is also possible that governmental responses to the current inflation environment could adversely affect our business, such as changes to monetary and fiscal policy that are too strict, or the imposition or threatened imposition of price controls. The duration and severity of the current inflationary period cannot be estimated with precision.

The Company’s success depends, in large part, on its ability to attract and retain key individuals. Competition for qualified candidates in the activities in which the Company engages and markets that the Company serves is significant, and the Company may not be able to hire candidates and retain them. Growth in the Company’s business, including through acquisitions, may increase its need for additional qualified personnel. The Company is increasingly competing for personnel with financial technology providers and other less regulated entities who may not have the same limitations on compensation as the Company does. This can be particularly constraining when competing for skill sets which are in high demand, such as technology, risk and information security. Recruiting and compensation costs may increase as a result of changes in the marketplace, which may increase costs and adversely impact the Company.

The increase in remote and hybrid-work arrangements and opportunities in regional, national and global labor markets hashave also increased competition for the Company to attract and retain skilled personnel. The Company’s current or future approach to in-office and remote-work arrangements may not meet the needs or expectations of current or prospective employees or may not be perceived as favorable as compared with the arrangements offered by other companies, which could adversely affect the Company’s ability to attract and retain employees. If the Company is not able to hire or retain highly skilled, qualified and diverse individuals, it may be unable to execute its business strategies and may suffer adverse consequences to its business, financial condition and results of operations.

Total consideration consisted of 3.4 million shares of HBT Financial’s common stock and $38.0 million in cash. Based upon the closing price of HBT Financial common stock of $21.12 on February 1, 2023, the aggregate consideration was approximately $109.4 million. Goodwill of $30.5 million was recorded in the acquisition. Total acquisition-relatedAcquisition-related expenses wererecognized during the year ended December 31, 2023 totaled $13.7 million, including the recognition of an allowance for credit losses on non-purchased credit deteriorated loans (“non-PCD loans”) of $5.2 million and an allowance for credit losses on unfunded commitments of $0.7 million through provision for credit losses, during the year ended December 31, 2023 and were $1.1 million during the year ended December 31, 2022.commitments. There were no Town and Country acquisition-related expenses duringrecognized subsequent to the yearsecond endedquarter Decemberof 31, 2024.2023.

•A $2.2$10.0 million decreaseincrease in net interest income, primarily attributable to higherlower funding costs which were partially offset bycosts, higher assetyields yieldson debt securities, and anhigher increaseaverage inloan interest-earning assetsbalances;

The following table sets forth average balances, average yields and costs, and certain other information. Average balances are daily average balances. Nonaccrual loans are included in the computation of average balances but have been reflected in the table as loans carrying a zero yield. The yields set forth below include the effect of deferred fees and costs, discounts and premiums,costs as well as purchase accounting adjustments that are accreted or amortized to interest income or expense.

Net interest income for the year ended December 31, 20242025 was $188.9$198.9 million, decreasingincreasing $2.2$10.0 million, or 1.2%,5.3%, when compared to the year ended December 31, 2023.2024. The decreaseincrease is primarily attributable to anlower funding costs, higher yields on debt securities, and higher average loan balances. Additionally, a $1.4 million increase in fundingloan costsfees whichand werenonaccrual interest recoveries was partially offset by highera yields$0.6 onmillion interest-earningdecrease assetsin andacquired higherloan interest-earningdiscount asset balances following the Town and Country merger.accretion.

TheDecreases FOMCin began loweringmarket interest rates in September 2024, with the target range for the federal funds rate decreasing by 100 basis points to a range of 4.25% to 4.50% by the end of 2024. This decrease,rates, and potential future decreases, may put downward pressure on our net interest margin, as the negative impact on floating rate loans may not be fully offset by the positive impacts of maturing fixed rate loans and securities repricing at higher rates or potential decreases in deposit costs. Generally, we expect increases in market interest rates will increase our net interest income and net interest margin in future periods, while decreases in market interest rates may decrease our net interest income and net interest margin in future periods; however, this depends upon the timing and extent of both short-term and long-term interest rate fluctuations and may not always be the case.

The Company recorded a provision for credit losses of $3.0$3.2 million for the year ended December 31, 2025, compared to a $3.0 million provision during the year ended December 31, 2024. The 20242025 provision for credit losses primarily reflects a $4.0$2.2 million increase in required reserves driven by changes within the portfolio; a $1.1 million increase in required reserves resulting from changes in qualitative factors; an $0.8 million increase in required reserves drivenresulting byfrom changes withinin theeconomic loanforecasts; portfolio;and a $1.2$0.9 million decrease in specific reserves on individually evaluated loans; and a $0.6 million decrease in required reserves resulting from improvements in economic forecasts.reserves.

CreditThe provision for credit losses areis highly dependent on current and forecast economic conditions. Potential deterioration of economic conditions may lead to higher credit losses and adversely impact our financial condition and results of operations. The economic forecasts utilized in estimating the allowance for credit losses on loans and unfunded lending-related unfunded commitments include the unemployment rate and changes in gross domestic product ("GDP") as macroeconomic variables, although other economic metrics are considered on a qualitative basis.

Total noninterest income for the year ended December 31, 2024,2025, was $35.6$38.2 million, aan decreaseincrease of $0.5$2.6 million, or 1.3%,7.4%, from the year ended December 31, 2023.2024. Notable changes in noninterest income include the following:

•A $1.1$1.2 million increase in wealth management fees, primarily driven by higher values of assets under management,management partiallyand offsetan byincrease lowerin farm management fees as a result of lower commodity prices;

•ImpairmentThe absence of $0.6 million of impairment losses on bank premises of $0.6 million related to the closure of two branch premises were recognized duringin 2024,the compared2024 to a $0.1 million gain on sales of closed branch premises recognized during 2023results; and

•A $0.3$0.2 million increasedecrease in income on bank owned life insurance, primarily attributable to the absence of a $0.2 million gain on life insurance proceeds.proceeds recognized in the 2024 results.

Total noninterest expense for the year ended December 31, 2024,2025, was $124.0$129.4 million, aan decreaseincrease of $7.0$5.4 million, or 5.3%,4.4%, from the year ended December 31, 2023.2024. Notable changes in noninterest expense include the following:

•TheA $1.3$2.2 million increase in employee benefits expense wasexpense, primarily attributabledriven toby higher medical benefits expensescost; and

During the years ended December 31, 20242025 and 2023,2024, we recorded income tax expense of $27.5 million, or an effective tax rate of 26.3%, and $25.6 million, or an effective tax rate of 26.3%, andrespectively. $22.7During million,2025, orwe anrecognized effective$0.3 million of additional tax rateexpense during the second quarter of 25.7%,2025, respectively.related Theto increasethe nonrecurring reversal of a stranded tax effect included in effectiveaccumulated taxother ratecomprehensive duringincome, 2024in wasconnection primarilywith attributablethe tomaturity of a derivative designated as a cash flow hedge. During 2024, we recognized an additional $0.5 million of tax expense for a deferred tax asset write-down, as a result of an Illinois tax change,law as well as changes in the proportion of federally tax-exempt interest income to pre-tax income.change.

Loans, before allowance for credit losses were $3.47$3.46 billion at December 31, 2024,2025, ana increasedecrease of $61.7$9.9 million, or 1.8%,0.3%, from December 31, 2023.2024. Notable changes include the following:

•AnA $18.9$113.4 million increase in multi-family loans and a $37.5 million increase in commercial real estate – non-owner occupied loans and a $13.6 million increase in multi-family loans, primarily attributable to new originations as well as completed construction projects transferred from the construction and land development category, partially offset by early payoffs; and

________________ (1) Weighted average LTV is based on the most recent appraisals available, which are generally obtained at the time of origination.

Multi-family loans totaled $431.5$544.9 million as of December 31, 2024,2025, and are primarily made based on projected cash flows from the rental or sale of the underlying collateral. As of December 31, 2024,2025, multi-family loans had a weighted average LTV of 57%,58%, based on the most recent appraisals available, which are generally obtained at the time of origination.

The following is management’s discussion and analysis of the financial condition as of MarchJune 31,30, 2026 (unaudited), as compared with December 31, 2025, and the results of operations for the three and six months ended MarchJune 31,30, 2026 and 2025 (unaudited). Management’s discussion and analysis should be read in conjunction with the Company’s unaudited consolidated financial statements and notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q, as well as the Company’s audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on March 6, 2026. Results of operations for the three and six months ended MarchJune 31,30, 2026 and 2025 are not necessarily indicative of results to be attained for the year ended December 31, 2026, or for any other period.

HBT Financial, Inc., headquartered in Bloomington, Illinois, is the holding company for Heartland Bank and Trust Company, and has banking roots that can be traced back to 1920. We provide a comprehensive suite of financial products and services to consumers, businesses, and municipal entities throughout Illinois, eastern Iowa, and suburban St. Louis. As of MarchJune 31,30, 2026, the Company had total assets of $6.8$6.7 billion, loans held for investment of $4.7$4.8 billion, and total deposits of $5.8 billion.

As of MarchJune 31,30, 2026, our branch network included 83 full-service branch locations throughout Illinois, eastern Iowa, and suburban St. Louis. We hold a leading deposit share in many of our central Illinois markets, which we define as a top three deposit share rank, providing the foundation for our strong deposit base. The stability provided by this low-cost funding is a key driver of our strong track record of financial performance. Below is a summary of our loan and deposit balances by geographic region:

Total consideration consisted of 5.5 million shares of HBT Financial’s common stock and $33.8 million in cash. Based on the closing price of HBT Financial common stock of $26.96 on February 27, 2026, the aggregate consideration was approximately $182.1 million. Goodwill of $23.7$22.1 million was recorded in the acquisition. Acquisition-related expenses totaled $15.7$0.3 million during the three months ended MarchJune 31,30, 2026 and $15.9 million during the six months ended June 30, 2026. There were no acquisition-related expenses during the three and six months ended MarchJune 31,30, 2025.

For the three months ended MarchJune 31,30, 2026, net income was $11.2$27.8 million, decreasingincreasing by $7.9$8.6 million, or 41.3%,44.8%, when compared to net income for the three months ended MarchJune 31,30, 2025, primarily as a result of acquisition-related expenses.2025. Notable changes include the following:

•A $7.7$19.4 million increase in net interest income, primarily attributable to higher average interest-earning asset balances following the CNB merger,merger and improved yields on debt securities, andwhich lowerwere partially offset by an increase in funding costs;

•CNB acquisition-related expenses totaled $15.7$0.3 million during the threesecond monthsquarter ended March 31,of 2026;

•Excluding CNB acquisition-related expenses, noninterest expense increased by $4.8$10.3 million, primarily reflectingdue higher base costs followingto the addition of CNB merger,operations, including a $2.6$6.2 million increase in employee salaries and employee benefits expense;

•A $2.6$2.8 million decreaseincrease in income tax expense, primarily due to aan decreaseincrease in pre-tax income as a result of CNBthe acquisition-relateditems expenses.noted above.

The following tabletables setsset forth average balances, average yields and costs, and certain other information. Average balances are daily average balances. Nonaccrual loans are included in the computation of average balances but have been reflected in the table as loans carrying a zero yield. The yields set forth below include the effect of deferred fees and costs as well as purchase accounting adjustments that are accreted or amortized to interest income or expense.

Net interest income for the three months ended MarchJune 31,30, 2026 was $56.4$69.1 million, increasing $7.7$19.4 million, or 15.8%,39.1%, when compared to the three months ended MarchJune 31,30, 2025. The increase is primarily attributable to higher average interest-earning asset balances following the CNB merger,merger and improved yields on debt securities, and lower funding costs.securities. Additionally, a $0.4$1.1 million increase in acquired loan discount accretion contributed to the improvement and was partially offset by a $0.2 million decrease in nonaccrual interest recoveries was mostly offset by a $0.3 million increase in loan fees.

Net interest margin increased to 4.20%4.32% for the three months ended MarchJune 31,30, 2026, compared to 4.12%4.14% for the three months ended MarchJune 31,30, 2025. The increase was primarily attributable to improved yields on debt securities and lowera more favorable interest-earning asset mix, which were partially offset by higher funding costs. Additionally, a 35 basis point increase in the contribution of acquired loan discount accretion to net interest margin was mostly offset by a 4 basis point decrease in the contribution of nonaccrualloan interestfees recoveries was mostly offset byand a 1 basis point increasedecrease in thenonaccrual contributioninterest of loan fees.recoveries.

From September 2025 to December 2025, the Federal Open Market Committee ("FOMC") lowered the target range for the federal funds rate with three 25 basis point reductions, setting a target range of 3.50% to 3.75% by the end of 2025. These reductions contributed to a decrease in funding costs and yields on variable rate loans while maturing fixed rate loans and securities continued to reprice at higher rates, resulting in a fairly stable net interest margin throughout 2025. Our net interest margin increased in the first quarterhalf of 2026 driven primarily by higher asset yields and the sale of the vast majority of the CNB securities portfolio, with the proceeds used to pay offreduce higher cost sources of funding and purchase higher yield debt securities.

Decreases in market interest rates, and potential future decreases, may put downward pressure on our net interest margin, as the negative impact on floating rate loans may not be fully offset by the positive impacts of maturing fixed rate loans and securities repricing at higher rates or potential decreases in deposit costs. Alternatively, increases in market interest rates may lead to increased competition for deposits and could increase our funding costs. Generally, we expect increases in market interest rates will increase our net interest income and net interest margin in future periods, while decreases in market interest rates may decrease our net interest income and net interest margin in future periods; however, this depends upon the timing and extent of both short-term and long-term interest rate fluctuations and may not always be the case.

The Company recorded a negative provision for credit losses of $0.2$0.7 million forduring the three months ended MarchJune 31,30, 2026, compared to a $0.6$0.5 million provision during the three months ended MarchJune 31,30, 2025. The second quarter of 2026 provision for credit losses primarily reflects a $0.3$3.9 million increase in required reserves resulting from changes in qualitative factors; a $1.3 million decrease in specific reserves,reserves; partiallya offset$1.0 million decrease in required reserves driven by changes in the economic forecast; and a $1.0 million decrease in required reserves driven by changes within the loan portfolio.

Total noninterest income for the three months ended MarchJune 31,30, 2026, was $10.9$11.8 million, an increase of $1.6$2.7 million, or 17.6%,29.6%, from the three months ended MarchJune 31,30, 2025. Notable changes in noninterest income include the following:

•A $0.9$1.1 million increase in wealth management fees, primarily driven by higher values of assets under management and an increase in assets under management following the CNB merger and higher values of assets under management;

•A $0.2$0.6 million positivenegative MSR fair value adjustment included in the 2026 results, compared to a $0.3$1.1 million negative MSR fair value adjustment included in the 2025 results; andresults.

Total noninterest expense for the three months ended MarchJune 31,30, 2026, was $52.4$42.4 million, an increase of $20.5$10.5 million, or 64.2%,33.0%, from the three months ended MarchJune 31,30, 2025. Notable changes in noninterest expense include the following:

•CNB acquisition-related expenses totaled $15.7$0.3 million during the three months ended MarchJune 31,30, 2026, including $8.7 million in data processing, $4.0 million in salaries,2026; and $2.4 million in professional fees and other noninterest expense;

•TheExcluding $4.8CNB acquisition-related expenses, the $10.3 million increase in noninterest expenses excluding CNB acquisition-related expensesexpense was primarily attributable to athe higher base leveladdition of noninterestCNB’s expense,operations, the majorityprimarily related to salariessalaries, employee benefits, data processing, and employeeoccupancy benefits;of andbank premises.

During the three months ended MarchJune 31,30, 2026 and 2025, we recorded income tax expense of $3.9$9.9 million, or an effective tax rate of 25.6%,26.3%, and $6.4$7.1 million, or an effective tax rate of 25.2%,27.0%, respectively. During the six months ended June 30, 2026 and 2025, we recorded income tax expense of $13.8 million, or an effective tax rate of 26.1%, and $13.6 million, or an effective tax rate of 26.1%, respectively.

•Following the CNB merger, $313.1 million of the debt securities acquired from CNB were sold with the sales proceeds used to pay offreduce higher cost sources of funding and purchase higher yield debt securities;

•Excluding the impact of the CNB merger, a $72.7$118.1 million decrease in total deposits was primarily attributable to anthe $88.9expected run-off of higher cost time deposit balances and $36.4 million decrease inof wealth management customer reciprocal money market deposits,deposits ofthat which $85.0 million waswere moved off-balance sheet due to strong levels of on-balance sheet liquidity; and

Loans, before allowance for credit losses were $4.69$4.75 billion at MarchJune 31,30, 2026, an increase of $1.23$1.30 billion, or 35.6%,37.5%, from December 31, 2025. Excluding the impact of the CNB merger, loans decreasedwere byrelatively $65.6 millionflat with the following notable changes:

•AAn $8.0 million reduction on two commercial and industrial lines of credit that funded shortly before and paid off after December 31, 2025;