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

Inflation risk is the risk that the value of assets or income from investments will be worth less in the future as inflation decreases the value of money. From 2021 to 2023, there was a significant rise in inflation, and the Federal Reserve Board raised certain benchmark interest rates in an effort to combat it. Inflation and rapid increases in interest rates havemay ledlead to a decline in the trading value of previously issued government securities with interest rates below current market interest rates. In addition, inflation generally increases the cost of goods and services we use in our business operationsoperations, which increases our noninterest expenses. Furthermore, our customers are also affected by inflation and the rising costs of goods and services used in their households and businesses, which could have a negative impact on their ability to repay their loans with us.

Our success depends, to a certain extent, upon local and national economic and political conditions, as well as governmental fiscal and monetary policies. Conditions such as inflation, recession, unemployment, changes in interest rates, fiscal and monetary policy, an increasing U.S. federal government budget deficit, the failure of the U.S federal government to raise the federal debt ceiling, slowing gross domestic product, tariffs, a U.S. withdrawal from or significant renegotiation of trade agreements, trade wars, and other factors beyond our control may adversely affect our deposit levels and composition, the quality of our assets including investment securities available for purchase and the demand for loans, which, in turn, may adversely affect our earnings and capital. Recent political developments, such as military conflicts in Ukraine andUkraine, the Middle East, and Venezuela have resulted in substantial changes in economic and political conditions for the U.S. and the remainder of the world. In addition, disruptions in U.S. and global financial markets and changes in oil production in the Middle East affect the economy and stock prices in the U.S., which can affect our earnings and our capital, as well as the ability of our customers to repay loans. Because we have a significant number of real estate loans, decreases in real estate values could adversely affect the value of property used as collateral and our ability to sell the collateral upon foreclosure. Adverse changes in the economy, including those resulting from pandemics, rising inflation, and increases in interest rates, may also have a negative effect on the ability of our borrowers to make timely repayments of their loans, which would have an adverse impact on our earnings and cash flows.

Our lending and deposit gathering activities are concentrated primarily in Ohio, Kentucky, North Carolina andCarolina, South Carolina.Carolina and, as of February 1, 2026, Tennessee. Our success depends on the general economic conditions of our primary market areas, particularly given that a significant portion of our lending relates to real estate located in these regions. Adverse changes in the regional and general economic conditions could reduce our growth rate, impair our ability to collect payments on loans, increase loan delinquencies, increase problem assets and foreclosures, increase claims and lawsuits, increase devaluations recognized within our OREO portfolio, decrease the demand for our products and services and decrease the value of collateral for loans, especially real estate values, which could have a material adverse effect on our financial condition, results of operations and cash flows.

Up until 2020, Park'sThe provision for credit losses had declined since the end of the most recent recession, which ended in June 2009, primarily due to improvement in general economic conditions, as well as actions taken by us to better manage our loan portfolio. During 2020, Park experienced elevated provision for credit losses primarily due to the impact of COVID-19. During 2021-2024, the provision fluctuatedfluctuates as a result of changes in charge-offs, economic forecasts and other assumptions. If we were to experience higher levels of provision for credit losses, it could result in lower levels of net income.

Our expansion into Kentucky, North Carolina, South CarolinaCarolina, andand, Northas Carolinaof February 1, 2026, Tennessee may also expose Park to additional geographic risk.

The accounting guidance under ASU 2016-13 “Financial Instruments – Credit Losses," requires banks to utilize the CECL model requires banks toand record, at the time of origination, credit losses expected throughout the life of financial assets measured at amortized cost, including loan receivables, HTM debt securities and reinsurance receivables, and off-balance sheet credit exposures not accounted for as insurance (loan commitments, standby letters of credit, financial guarantees and other similar instruments) and net investments in leases recognized by a lessor. Under the CECL model, we are required to use historical information, current conditions and reasonable and supportable forecasts to estimate the expected credit losses. If the methodologies and assumptions we use in the CECL model prove to be incorrect, or inadequate, the allowance for credit losses may not be sufficient, resulting in the need for additional provisions for credit losses to be recorded, which could have a material adverse impact on our financial condition and results of operations.

AsThe CECL model uses a result of the implementation of the CECL model, thelife-of-loan time horizon over which we are required to estimate future credit losses expanded,losses, which could result in increased volatility in future provisions for credit losses. We may also experience a higher or more volatile provision for credit losses due to higher levels of nonperforming loans and net charge-offs if commercial and consumer customers are unable to make scheduled loan payments.

In addition, prior debt offerings could potentially have important consequences to us and our debt and equity investors, including:

Although we have paid a dividend on our common shares every quarter since becoming a public company, our Board of Directors reviews the dividend on a quarterly basis and establishes the dividend rate based on our financial condition, results of operations, capital and other regulatory requirements, and other factors that ourthey Board of Directors deemsdeem relevant. As a financial holding company, we are a legal entity separate and distinct from our subsidiaries and affiliates. Our principal source of funds to pay dividends on our common shares and service our debt is dividends from our subsidiaries. In the event our subsidiaries become unable to pay dividends to us, we may not be able to service our debt, pay our other obligations or pay dividends on our common shares. Accordingly, our inability to receive dividends from our subsidiaries could also have a material adverse effect on our business, financial condition and results of operations.

We are currently party to a limited number of derivative transactions. ManyHowever, some of these derivative instruments are individually negotiated and non-standardized, which can make exiting, transferring or settling the position difficult. We carry borrowings which contain embedded derivatives. These borrowing arrangements require that we deliver underlying securities to the counterparty as collateral. We are dependent on the creditworthiness of the counterparties and are therefore susceptible to credit and operational risk in these situations.

In light of conditions in the global financial markets and the global economy that occurred in the last two decades, regulators havehave, at times, increased their focus on the regulation of the financial services industry. MostThe recently,current administration has pursued a regulatory reform agenda that is significantly different than the U.S.prior Congressadministration, including a lessening of certain regulatory burdens and enforcement priorities for the federal agenciesbanking regulatingagencies. This evolving regulatory and supervisory environment creates uncertainty about the timing and scope of future laws, regulations, policies and priorities. Further, it is possible that future administrations may have a different view of regulatory reform and supervision of the financial services industryindustry. haveIncreased actedrules on an unprecedented scale in responding to the stresses experienced in the global financial markets. Some of the laws enacted by the U.S. Congress andor regulations promulgated by federal bank regulatory agencies in the future may subject us, and other financial institutions to which such laws and regulations apply, to additional restrictions, oversight and costs that may have an impact on our business, results of operations or the trading price of our common shares. In addition to laws, regulations and supervisory and enforcement actions directed at the operations of financial institutions, proposals to reform the housing finance market consider significant changes to Fannie Mae and Freddie Mac, which could negatively affect our sales of loans.

We have limited ability to control the amount of premiums we are required to pay for FDIC insurance. The DIF is funded by fees assessed on insured depository institutions. If the costs of future bank failures increase, deposit insurance premiums may also increase. The FDIC has adopted rules revising the FDIC's assessments in a manner benefiting banks with assets totaling less than $10 billion. With the acquisition of First Citizen's on February 1, 2026, Park National Bank will become subject to the FDIC’s large bank pricing methodology, which may result in a different, and potentially higher, assessment rate. There can be no assurance, however, that assessments will not be changed in the future. Federal deposit insurance is described in more detail in the section captioned "Supervision and Regulation of Park and Park's Subsidiaries – Federal Deposit Insurance" in "ITEM 1. BUSINESS" of this Annual Report on Form 10-K.

We have completed various acquisitions of other financial institutions and branches and assets of other financial institutions in the past, including our recent acquisition of First Citizens and its banking subsidiary, First Citizens National Bank, on February 1, 2026. We may acquire other financial institutions, or branches or assets of other financial institutions, in the future. We may also open new branches and enter into new lines of business or offer new products or services. Any such expansion of our business will involve a number of expenses and risks, which may include:

We have significant investments in financial service office premises and equipment for our financial service office network, includingincluding, as of December 31, 2025, 87 financial service offices as well as our retail work force and other financial service office banking assets. Advances in technology such as e-commerce, telephone, internet and mobile banking, and in-branch self-service technologies including automatic teller machines and other equipment, as well as changing customer preferences for these other methods of accessing our products and services, could affect the value of our financial service office network or other retail distribution assets and may cause us to change our retail distribution strategy, close and/or sell certain financial service offices and restructure or reduce our remaining financial service offices and work force. Further advances in technology and/or changes in customer preferences including those related to social media, digital or cryptocurrency, blockchain, and other “fintech” technologies could result in additional changes in our retail distribution strategy and/or financial service office network. These actions could lead to losses on these assets or could adversely impact the carrying value of other long-lived assets and may lead to increased expenditures to renovate and reconfigure remaining financial service offices or to otherwise reform our retail distribution channel.

If our total consolidated assets exceed $10.0 billion, we will become subject to additional regulationsregulations.

As of December 31, 2024,2025, Park had total consolidated assets of $9.8 billion. However,With shouldthe ourFebruary 1, 2026 acquisition of First Citizens, Park expects that the total consolidated assets of Park will exceed $10.0 billion,billion at December 31, 2026, subjecting Park and Park National Bank will become subject to heightened regulatory requirements stemming largely from the Dodd-Frank Act. These requirements include, but are not limited to, the following: (i) supervision, examination and enforcement by the CFPB with respect to federal consumer financial protection laws; (ii) a modified methodology and scorecard for calculating FDIC insurance assessments and, depending on the result of Park National Bank’s performance under the scorecard, potentially higher assessment rates; (iii) limitations on interchange transaction fees for debit card transactions; (iv) heightened compliance standards under the Volcker Rule; (v) enhanced supervision by the OCC and the Federal Reserve Board; and (vi) no longer being eligible to elect to be subject to the CBLR. The imposition of these regulatory requirements and increased supervision, should the $10.0 billion threshold be crossed, may require the additional commitment of financial resources to regulatory compliance and may increase Park National Bank’s cost of operations and provide greater limitations on the products and services that can be offered.

From time to time, revenue, expenses and/or taxes are impacted by items judged by management of Park to be outside of ordinary banking activities and/or by items that, while they may be associated with ordinary banking activities, are so unusually large that their outsized impact is believed by management of Park at that time to be infrequent or short-term in nature. Most often, these items impacting comparability of period results are due to merger and acquisition activities and revenue and expenses related to former Vision Bank loan relationships. In other cases, they may result from management's decisions associated with significant corporate actions outside of the ordinary course of business.

Even though certain revenue and expense items are naturally subject to more volatility than others due to changes in market and economic environment conditions, as a general rule volatility alone does not result in the inclusion of an item as one impacting comparability of period results. For example, changes in the provision for / (recovery of) credit losses (aside from those related to former Vision Bank loan relationships), gains (losses) on equity securities, net, and asset valuation adjustments, reflect ordinary banking activities and are, therefore, typically excluded from consideration as items impacting comparability of period results.

Management has included in this Management's Discussion and Analysis of Financial Condition and Results of Operation, information relating to the return on average tangible equity, the return on average tangible assets, the tangible equity to tangible assets ratio,andratio, and pre-tax, pre-provision net income for the years ended December 31, 2024,2025, December 31, 2023,2024, and December 31, 2022.2023. For the purpose of calculating the return on average tangible equity, a non-GAAPnon-U.S. GAAP financial measure, net income for each period is divided by average tangible equity during the period. Average tangible equity equals average shareholders' equity during the applicable period less average goodwill and other intangible assets during the applicable period. For the purpose of calculating the return on average tangible assets, a non-GAAPnon-U.S. GAAP financial measure, net income for each period is divided by average tangible assets during the period. Average tangible assets equals average assets during the applicable period less average goodwill and other intangible assets during the applicable period. For the purpose of calculating the tangible equity to tangible assets ratio, a non-GAAPnon-U.S. GAAP financial measure, tangible equity is divided by tangible assets. Tangible equity equals total shareholders' equity less goodwill and other intangible assets, in each case at period end. Tangible assets equal total assets less goodwill and other intangible assets, in each case at period end. For the purpose of calculating pre-tax, pre-provision net income, a non-GAAPnon-U.S. GAAP financial measure, income taxes and the provision for credit losses are added back to net income, in each case during the applicable period.

Pre-tax, pre-provision netNet income (non-U.S.for GAAP)the year ended December 31, 2025 of $180.1 million represented a $28.7 million, or 18.9% increase compared to $151.4 million for the year ended December 31, 2024. Net income for the year ended December 31, 2024 of $199.3$151.4 million represented a $42.8$24.7 million, or 27.3%,19.5%, increase compared to $156.5$126.7 million for the year ended December 31, 2023. Pre-tax, pre-provision net income for the year ended December 31, 2023 of $156.5 million represented a $28.5 million, or 15.4%, decrease compared to $185.0 million for the year ended December 31, 2022.

Cash dividends declared on Park's common shares were $5.53 in 2025, $4.74 in 2024,2024 and $4.20 in 2023 and $4.66 in 2022.2023. Dividends declared as a percentage of net income was 51%,50%, 51% and 54% and 51% for 2024,2025, 20232024 and 2022,2023, respectively. ManagementPark targetshas historically targeted a dividend payout ratio of 50% each year.

The quarterly cash dividend on Park's common shares was $1.07 per share for the first, second, third and fourth quarters of 2025. Additionally, in the fourth quarter of 2025 there was a special cash dividend of $1.25 per share. The quarterly cash dividend on Park's common shares was $1.06 per share for the first, secondsecond, third, and thirdfourth quarters of 2024, and $1.56 per share for the fourth quarter of 2024. TheAdditionally, in fourth quarter of 2024 includedthere was a one-time special cash dividend of $0.50 per share. The quarterly cash dividend on Park's common shares was $1.05 per share for each of the quarters of 2023.2023 Theand quarterlythere cashwas no special dividend onin Park's common shares was $1.04 per share for the first, second and third quarters of 2022, and $1.54 per share for the fourth quarter of 2022. The fourth quarter of 2022 included a one-time special cash dividend of $0.50 per share.2023.

As noted above, in calculating the ACL, management weighs different scenarios, including a baseline (most likely) scenario and an adverse scenario. At December 31, 2024,2025, management applied a 50% weighting to the baseline scenario and applied a 50% weighting to the adverse scenario. To create hypothetical sensitivity analyses, management calculated a quantitative allowance using a 100% weighting applied to a baseline scenario and a quantitative allowance using a 100% weighting applied to an adverse scenario. The adverse scenario assumes among other things that: (1) TensionsWorries withthat Chinathe Israel-Hamas conflict will widen and TaiwanRussia’s increaseinvasion and China briefly interrupts trade throughof the TaiwanUkraine Straitwill and the Russian invasion lastspersist longer than expected. WorriesRisk growgrows that China may block the Hamas-IsraelTaiwan conflictStrait, willcausing business and consumer confidence to decline. Retaliatory tariffs reduce US exports and lead to a widerglobal conflict.downturn. (2) DueThe tocombination continuingof concernsa aboutrecession and rising inflation,inflation causes the Federal Reserve raisesto lower federal funds rates in Q1 2026 but only slightly below baseline for a couple of quarters. As a recession persists and inflation subsides, the Federal Reserve subsequently reduces the federal funds rate.rate However,more it resumes easing in Q3 2025 as a downturn persists.significantly. (3) Europe goes into a recession as increased tariffs lower exports. Populism in Europe rises, raising uncertainties about longevity of the Euro zone and causes financial stress to highly indebted nations, especially Italy. These developments further lower US exports and corporate earnings of foreign subsidiaries of US companies. (4) Impacts of Trump tariffs and deportations are significantly worse than expected. TariffsTariff willrate berises leviedfrom onabout China, Canada, Mexico19% and Europeit andremains there through the tariffend rateof will increase more than in the baseline forecast before rolling back in 2026.2028. Retaliatory tariffs reduce US exports and lead to a global turndown. Tax revenues are lower than in the baseline creating a higher deficit.deficit and concerns about national debt level raise uncertainty about the course of tax policy. Full extensions of the Tax Cuts and Jobs Act personal provisions are passed as well as increased state/local tax deductions, certain business tax provisions, and other tax credits/deductions do not expire. Growth in Medicaid funding is reduced and foreign aid funding remains capped. Defense and immigration spending will continue to rise. (5) Recession in Q1 20252026 whichand lasts through Q3 2025.2026 Realand real GDP declines by 2.6%. The unemploymentUnemployment rate rises to a peak of 8.3% in8.4% Q1 2026.2027. The stockStock market falls 35% from Q1 20252026 to Q3 2025. The adverse scenario forecasts Ohio unemployment for the next twelve months to range from 6.6% to 9.5%.2026. Excluding consideration of qualitative adjustments, this sensitivity analysis would result in a hypothetical increase in Park's ACL of $27.5$30.0 million as of December 31, 20242025 if only the adverse scenario was used. Excluding consideration of qualitative adjustments, a corresponding $27.5$30.0 million decrease in Park's ACL would occur in a hypothetical scenario if only the baseline (most likely) scenario was used.

Through our national bank subsidiary, PNB, Park is engaged in a general commercial banking and trust and wealth management business, primarily in Ohio, Kentucky, North Carolina andCarolina, South Carolina, and, as of February 1, 2026, Tennessee, with the exception of nationwide aircraft loans and nationwide asset-based lending to consumer finance companies. Management believes there are a significant number of consumers and businesses that seek long-term relationships with community-based financial institutions of quality and strength. While not engaging in activities such as foreign lending, nationally syndicated loans or investment banking, Park attempts to meet the needs of our customers for commercial, real estate and consumer loans, and investment, fiduciary and deposit services.

Park’s subsidiaries compete for deposits and loans with other banks, savings associations, credit unions and other types of financial institutions. At December 31, 2024,2025, Park operated 87 financial service offices (including those of PNB and Scope Leasing, Inc. ("Scope Aircraft Finance")) and a network of 108107 automated teller machines in 24 Ohio counties, five North Carolina counties, four South Carolina counties and one Kentucky county. SEPH and Guardian each operated one administrative office, located in Newark, Ohio.

Average total deposits were $8,462 million in 2025, compared to $8,260 million in 2024,2024 and compared to $8,360 million in 2023 and $8,450 million in 2022.2023. The average interest rate paid on interest bearing deposits was 1.71% in 2025, 1.97% in 2024,2024 and 1.52% in 2023 and 0.39% in 2022.2023. The average cost of interest bearing deposits for each quarter of 20242025 was 1.90%1.61% for the fourth quarter, 2.06%1.74% for the third quarter, 1.99%1.73% for the second quarter and 1.94%1.76% for the first quarter.

During the year ended December 31, 2024,2025, total deposits including off balance sheet deposits increased by $215.0$90.3 million, or 2.7%.1.1%. This increase consisted of a $134.5$213.2 million increase in total commercial deposits,deposits and a $114.0$46.5 million increase in offretail balancedeposits, sheetpartially depositsoffset andby a $11.5$159.5 million increasedecrease in brokered and bid CD deposits,deposits partially offset byand a $45.0$9.9 million decrease in totaloff retailbalance sheet deposits. The majority of off balance sheet deposits are commercial and thus impact the change in commercial deposits as the deposits are moved on or off the balance sheet.

Included in the total commercial deposits and off balance sheet deposits shown in the previous table are public fund deposits. These balances fluctuate based on seasonality and the cycle of collection and remittance of tax funds. Public funds include Bid Ohio CDs. The following table details the change in public fund deposits.deposits held on and off Park's balance sheet.

As of December 31, 2025, Park had approximately $1.5 billion of uninsured deposits, which was 18.5% of total deposits. Uninsured deposits of $1.5 billion included $382.6 million of deposits that were over $250,000, but were fully collateralized by Park's investment securities portfolio. As of December 31, 2024, Park had approximately $1.4 billion of uninsured deposits, which was 17.6% of total deposits. Uninsured deposits of $1.4 billion included $395.4 million of deposits that were over $250,000, but were fully collateralized by Park's investment securities portfolio. As of December 31, 2023, Park had approximately $1.3 billion of uninsured deposits, which was 16.2% of total deposits. Uninsured deposits of $1.3 billion included $288.2 million of deposits which were over $250,000 but were fully collateralized by Park's investment securities portfolio. The uninsured amounts, those in excess of the $250,000 FDIC insurance limit, are estimates based on the methodologies used for the Corporation's regulatory reporting requirements.

Subordinated Notes: Park assumed, with the 2007 acquisition of Vision'sVision Bank's parent holding company, $15.5 million of floating rate junior subordinated notes. The $15.5 million of junior subordinated notes were purchased by Vision Bancshares Trust I ("Trust I") following the issuance of Trust I's $15.0 million of floating rate preferred securities. The interest rate on these junior subordinated notes adjustsadjusted every quarter at 174 basis points above the three-month CME Term SOFR. The maturity date for the junior subordinated notes iswas December 30, 2035, and, since December 30, 2010, Park has had the right to prepay the junior subordinated notes, without penalty. TheseOn juniorSeptember subordinated30, notes2025, qualifyPark asredeemed Tierin 1full, capital$15.0 undermillion currentin FederalTrust ReservePreferred BoardSecurities guidelines.at a redemption price in cash equal to 100% of the principal amount of the Trust Preferred Securities, plus accrued and unpaid interest.

In accordance with U.S. GAAP, Park reflects any unrealized holding gain or loss on AFS debt securities, any unrealized net holding gain or loss on cash flow hedging derivativessecurities and any change in the funded status of Park's pension plan, in each case, net of income taxes, as accumulated other comprehensive (loss) income which is part of Park’s shareholders’ equity.

The unrealized net holding loss, net of income taxes, on AFS debt securities was $32.3 million at year-end 2025, compared to an unrealized net holding loss, net of income taxes, of $62.9 million at year-end 2024,2024 compared toand an unrealized net holding loss, net of income taxes, $67.9 million at year-end 20232023. and compared to anThe unrealized net holding loss,loss on AFS debt securities at December 31, 2025 was impacted by the realization of $1.8 million in losses, net of income taxes, during the year ended December 31, 2025 as the result of $95.7the sale of $79.1 million atin year-endAFS 2022.debt securities. The unrealized net holding loss on AFS debt securities at December 31, 2024 was impacted by the realization of $415,000 in losses, net of income taxes, during the year ended December 31, 2024 as the result of the sale of $44.6 million in AFS debt securities. The unrealized net holding loss on AFS debt securities at December 31, 2023 was impacted by the realization of $6.2 million in losses, net of income taxes, during the year ended December 31, 2023 as the result of the sale of $291.0 million in AFS debt securities.

In accordance with U.S. GAAP, Park adjusts accumulated other comprehensive (loss) income to recognize the net actuarial gain or loss and prior service cost or credit reflected in the funding status of Park’s pension plan. See "Note 2120 - Benefit Plans" of the Notes to Consolidated Financial Statements included in "ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA" of this Annual Report on Form 10-K for additional information on the accounting for Park’s pension plan. At year-end 2024,2025, the balance in accumulated other comprehensive loss pertaining to the pension plan was unrealized income of $19.6 million, compared to unrealized income of $16.8 million,million at December 31, 2024 and compared to unrealized income of $1.7 million at December 31, 2023 and compared to an unrealized loss of $6.7 million at December 31, 2022.2023.

The net other comprehensive income in 2023 was largely due to a $10.5 million ($8.3 million, net of taxes) net actuarial gain. The gain was due to asset returns greater than expected, partially offset by the impact of demographic losses driven by salary increases greater than assumed and a decrease in the discount rate. The net other comprehensive loss in 2022 was largely due to $558,000 ($441,000, net of taxes) in prior service cost, as a result of plan amendments, and a $551,000 ($435,000, net of taxes) net actuarial loss.

Loans: Average loans were $7,924 million in 2025, compared to $7,627 million in 2024,2024 compared toand $7,222 million in 2023 and $6,956 million in 2022.2023. The average yield on average loan balancesloans was 6.33% in 2025, compared to 6.14% in 2024,2024 compared toand 5.55% in 2023 and 4.65% in 2022.2023. Approximately 45%46% of Park’s loan balances mature or reprice within one year (see Table 3132). The average yield on average loan balancesloans for each quarter of 20242025 was 6.21%6.34% for the fourth quarter, 6.24%6.34% for the third quarter, 6.13%6.37% for the second quarter and 5.99%6.26% for the first quarter.

Loan interest income for 2025, 2024, 2023, and 20222023 included $54,000,$2.0 $631,000million, $54,000 and $3.7 million,$631,000, respectively, related to payments received on certain SEPH nonaccrual loan relationships, some of which are participated with PNB. In addition, loan interest income included $668,000, $1.2 million, $633,000million and $1.8 million,$633,000, respectively, of the accretion of loan purchase accounting adjustments related to the acquisitions of NewDominion and Carolina Alliance. Loan interest income for 2023 and 2022 included interest and fee income related to PPP loans of $69,000 and $3.1 million, respectively.$69,000.

On a combined basis, year-end commercial, financial and agricultural loans, construction real estate loans and commercial real estate loans increased by $143.7 million, or 3.9%, in 2025. The increase in 2025 was due to an increase in commercial real estate loans of $214.3 million, which were partially offset by an decrease in commercial, financial and agricultural loans of $57.4 million and a decrease in construction real estate loans of $13.2 million. On a combined basis, year-end commercial, financial and agricultural loans, construction real estate loans and commercial real estate loans increased by $199.8 million, or 5.7%, in 2024. The increase in 2024 was due to an increase in commercial real estate loans of $118.3 million and an increase in construction real estate loans of $107.5 million, which were partially offset by ana decrease in commercial, financial and agricultural loans of $26.1 million. On a combined basis, year-end commercial, financial and agricultural loans, construction real estate loans and commercial real estate loans increased $56.3 million, or 1.6%, in 2023. The increase in 2023 was due to an increase in commercial real estate of $81.9 million, partially offset by a decrease of $20.3 million in construction real estate and a $5.3 million decrease in commercial, financial and agricultural loans.

Consumer loans decreased by $87.1 million, or 4.6% in 2025 and decreased by $35.6 million, or 1.8% in 2024 and increased by $41.0 million, or 2.1%, in 2023.2024. The change in consumer loans in 20242025 and 20232024 was primarily due to fluctuationsdecreases in automobile lending in Ohio.Ohio due to strategic balance sheet management.

Residential real estate loans increased by $174.9 million, or 8.0% in 2025 and increased by $170.9 million, or 8.4% in 20242024. The increase in 2025 was due to an increase in commercial loans secured by residential real estate of $108.3 million, an increase in home equity loans secured by residential real estate of $37.6 million and increasedan increase in mortgage loans secured by $232.7residential million,real orestate 12.9%,of in$29.1 2023.million. The increase in 2024 was due to an increase in mortgage loans secured by residential real estate of $106.7 million, an increase in commercial loans secured by residential real estate of $35.0 million,million and an increase in home equity loans secured by residential real estate of $29.1 million and an increase in installment loans secured by residential real estate of $109,000. The increase in 2023 was due to an increase in mortgage loans secured by residential real estate of $164.4 million, an increase in commercial loans secured by residential real estate of $59.2 million, an increase in home equity loans secured by residential real estate of $7.2 million and an increase in installment loans secured by residential real estate of $1.8 million.

During 2025, Park sold certain AFS debt securities with a book value of $79.1 million at a gross loss of $2.3 million. During 2024, Park sold certain AFS debt securities with a book value of $42.3 million at a gross loss of $553,000 and sold certain AFS debt securities with a book value of $2.3 million for a gross gain of $27,000. During 2023, Park sold certain AFS debt securities with a book value of $291.0 million at a gross loss of $7.9 million. There were no sales of AFS debt securities in 2022.

Other investment securities (as shown on Park's Consolidated Balance Sheets) consist of restricted stock investments in the FHLB and the FRB and equity securities which include equity investments in other financial institutions and equity investments in limited partnerships which provide mezzanine funding. Total other investment securities were $113 million at December 31, 2025, $104 million at December 31, 2024,2024 and $96 million at December 31, 2023 and $87 million at December 31, 2022.2023. There were $494,000 in FHLB stock purchases in 2025, $9.2 million in FHLB stock purchases in 2024,2024 and $18.2 million in FHLB stock purchases in 2023 and no FHLB stock purchases in 2022.2023. Proceeds from the redemption/repurchase of FHLB stock were $1.1 million in 2025, compared to $18.4 million in 2024, compared toand $11.7 million in 2023 and compared to $2.2 million in 2022.2023. No shares of FRB stock were purchased or sold in any of the years ended December 31, 2025, 2024, 2023, or 2022.2023. Management purchased equity securities totaling $5.8 million in 2025, $10.2 million in 2024,2024 and $2.2 million in 2023 and $9.2 million in 2022.2023. During the years ended December 31, 2025, 2024, 2023, and 2022.2023, Park entered into partnership agreements with commitments totaling $157,000, $2.5 million, $2.7 million and $16.3$2.7 million, respectively. Funding of limited partnerships totaled $7.5$8.1 million, $5.6$7.5 million and $4.8$5.6 million during the years ended December 31, 2025, 2024, and 2023, and 2022, respectively.

"Gain on equity securities, net" on Park's Consolidated Statements of Income were $3.1$4.7 million, $971,000$3.1 million and $3.0 million$971,000 for the years ended December 31, 2024,2025, 20232024 and 2022,2023, respectively. These gains on equity securities were made up of gains (losses) on equity investments carried at fair value or modified cost as well as gains (losses) on equity investments carried at modified cost and gains (losses) on partnership investments carried at NAV.

For the years ended December 31, 2024,2025, 20232024 and 2022,2023, $3.5 million, $2.6 million, $600,000million and $601,000,$600,000, respectively, of gains on equity investments carried at fair value or modified cost were recorded within "Gain on equity securities, net" on Park's Consolidated Statements of Income.

For the years ended December 31, 2024,2025, 20232024 and 2022,2023, $468,000,$1.2 $371,000million, $468,000 and $2.4 million,$371,000, respectively, of gains on equity investments carried at NAV were recorded within "Gain on equity securities, net" on Park's Consolidated Statements of Income.

(1)Loan income includes net loan-related origination fee (expense) income, purchase accounting accretion and origination expense in the aggregate amount of $(11.1) million in 2025, $(11.6) million in 2024,2024 and $(12.1) million in 2023 and $(5.5) million in 2022.2023. Loan income also includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate in 2024,2025, 20232024 and 2022.2023. The taxable equivalent adjustments were $1.1 million in 2025, $964,000 in 2024,2024 and $811,000 in 2023 and $627,000 in 2022.2023.

Loan interest income for 2025, 2024, 2023, and 20222023 included $54,000,$2.0 $631,000million, $54,000 and $3.7 million,$631,000, respectively, related to payments received on certain SEPH nonaccrual loan relationships, some of which are participated with PNB. In addition, loan interest income included $668,000, $1.2 million, $633,000million and $1.8 million,$633,000, respectively, of the accretion of loan purchase accounting adjustments related to the acquisitions of NewDominion and Carolina Alliance. Loan interest income for 2023 and 2022 included interest and fee income related to PPP loans of $69,000 and $3.1 million, respectively.$69,000. Excluding the impact of the purchase accounting accretion, SEPH income, and PPP income, the average yield on loans was 6.13%,6.29%, 5.53%6.13% and 4.55%,5.53%, for the years ended December 31, 2025, 2024, 2023, and 2022.2023. Excluding the impact of the purchase accounting accretion, SEPH income, and PPP income, the average yield on earning assets was 5.77%,5.87%, 5.17%5.77% and 4.06%,5.17%, for the years ended December 31, 2025, 2024, 2023 and 2022,2023, respectively, and the net interest margin was 4.39%,4.72%, 4.09%4.39% and 3.72%,4.09%, for the years ended December 31, 2025, 2024, 2023 and 2022,2023, respectively.

Average interest bearing liabilities for 2025 increased by $36 million, or 0.6%, to $6,042 million, compared to $6,006 million for 2024. Average interest bearing liabilities for 2024 increased by $88 million, or 1.5%, to $6,006 million, compared to $5,918 million for 2023. Average interest bearing liabilities for 2023 increased by $166 million, or 2.9%, to $5,918 million, compared to $5,752 million for 2022. The average cost of interest bearing liabilities increaseddecreased by 4131 basis points to 2.08%1.77% for 2024,2025, compared to 2.08% for 2024 and 1.67% for 2023 and 0.54% for 2022.2023.

(1) Commercial loan interest income includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate in 2023,2025, 20222024 and 2021.2023. The taxable equivalent adjustments were $1.1 million in 2025, $964,000 in 2024,2024 and $811,000 in 2023 and $627,000 in 2022.2023.

Loan interest income for 2024,2025, 2023,2024 and 20222023 included $54,000,$2.0 $631,000million, $54,000 and $3.7 million,$631,000, respectively, related to payments received on certain SEPH nonaccrual loan relationships, some of which are participated with PNB, as well as $668,000, $1.2 million, $633,000million and $1.8 million$633,000 of purchase accounting accretion for 2024,2025, 20232024 and 2022,2023, respectively. Interest income for 2023 and 2022 included interest and fee income related to PPP loans of $69,000 and $3.1 million, respectively.$69,000. Below is a summary of the impact of these items on the tax equivalent yield of loans.

•The amount of interest related to purchase accounting accretion included in real estate loan interest income for 2024,2024 and 2023 and 2022 was $80,000, $4,000$80,000 and $170,000,$4,000, respectively. Excluding the impact of these items, the average tax equivalent yield on real estate loans was 5.07%, 4.38%5.07% and 3.80%,4.38%, respectively. There was no purchase accounting accretion included in real estate loan interest income for 2025.

•The amount of interest related to PPP income, SEPH nonaccrual loan relationships and purchase accounting accretion included in commercial loan interest income for 2024,2025, 2024 and 2023 and 2022 was $935,000,$2.0 $1.2million, million$935,000 and $8.2$1.2 million, respectively. Excluding the impact of these items, the average tax equivalent yield on commercial loans was 6.23%, 5.80%6.23% and 4.66%,5.80%, for 2024,2025, 20232024 and 2022,2023, respectively.

Income from fiduciary activities increased by $3.3 million, or 7.7%, to $45.8 million in 2025, compared to $42.5 million in 2024. The $42.5 million in 2024 was an increase of $7.0 million, or 19.8%, to $42.5 million, compared to $35.5 million in 2023. The $35.5 million in 2023 was an increase of $1.4 million, or 4.1%, compared to $34.1 million in 2022. The majority of fiduciary fees are calculated on a lag, based on the market value of the assets under management. The average market value of the wealth management assets managed by PNB was $9.07 billion in 2025, compared to $8.58 billion in 2024,2024 compared toand $7.69 billion in 20232023. andThe $7.22 billionincrease in 2022.fiduciary fee income in 2025 was largely due to an increase in the market value of assets under management. The increase in fiduciary fee income in 2024 was largely due to an increase in the market value of assets under management as well as updates to the fee structure.

Service charges on deposit accounts increased $556,000,$1.1 million, or 6.6%,11.7%, to $10.1 million in 2025, compared to $9.0 million in 2024,2024. The $9.0 million in 2024 was an increase of $556,000, or 6.6%, compared to $8.4 million in 2023. The $8.4 millionincreases in 20232025 was a decrease of $1.6 million, or 16.3%, compared to $10.1 million in 2022. The increase inand 2024 waswere related to increases in service charges on demand deposit accounts, partially offset by decreases in non-sufficient funds (NSF) fee income. The decrease in 2023 was related to decreases in non-sufficient funds (NSF) fee income.

Other service income increased $1.4$2.7 million, or 23.3%, to $14.5 million in 2024,2025, or 14.0%,compared to $11.7 million in 2024. The $11.7 million in 2024 was an increase of $1.4 million, or 14.0%, compared to $10.3 million in 2023. The $10.3 millionincrease in 2023 was a decrease of $5.0 million, or 32.7%,2025 compared to $15.32024 millionwas primarily due to an increase in 2022.other service income related to mortgage loan originations and commercial related other service income, including a $957,000 increase in fee income related to mortgage loan originations to be sold in the secondary market, a $578,000 increase in mortgage servicing rights income and a $458,000 increase in commercial related other service income. The increase in 2024 compared to 2023 was primarily due to an increase in other service income related to mortgage loan originations, including a $950,000 increase in fee income related to mortgage loan originations to be sold in the secondary market and a $400,000 increase in mortgage servicing rights income. The decrease in 2023 compared to 2022 was primarily related to a decrease in other service income related to mortgage loan originations, including a $2.6 million decrease in fee income related to mortgage loan originations to be sold in the secondary market and a $1.7 million decrease in mortgage servicing rights income, partially offset by a $465,000 increase in income related to investor rate locks and loans held for sale. Park has experienced fluctuationsincreases in mortgage loan origination volume resulting in increases and decreases in other service income. A summary of mortgage loan originations for the years ended December 31, 2024,2025, 2024 and 2023 and 2022as follows.

Management has included in the tables included within the "Items Impacting Comparability" section of this MD&A information relating to the annualized return on average tangible equity, the annualized return on average tangible assets and pre-tax, pre-provision net income for the three months ended and at June 30, 2026, March 31, 2026, and June 30, 2025 and for the six months ended June 30, 2026 and MarchJune 31,30, 2025. For the purpose of calculating the annualized return on average tangible equity, a non-U.S. GAAP financial measure, net income for each period is divided by average tangible equity during the period. Average tangible equity equals average shareholders' equity during the applicable period less average goodwill and other intangible assets during the applicable period. For the purpose of calculating the annualized return on average tangible assets, a non-U.S. GAAP financial measure, net income for each period is divided by average tangible assets during the period. Average tangible assets equals average assets during the applicable period less average goodwill and other intangible assets during the applicable period. For the purpose of calculating pre-tax, pre-provision net income, a non-U.S. GAAP financial measure, income taxes and the provision for credit losses are added back to net income, in each case during the applicable period.

Interest income, yields, and ratios on a FTE basis are considered non-U.S. GAAP financial measures. Management believes net interest income on a FTE basis provides an insightful picture of the interest margin for comparison purposes. The FTE basis also allows management to assess the comparability of revenue arising from both taxable and tax-exempt sources. The FTE basis assumes a federal corporate income tax rate of 21 percent.21%. In the tables included within the "Items Impacting Comparability" section of this MD&A, Park has provided a reconciliation of FTE interest income solely for the purpose of complying with SEC Regulation G and not as an indication that FTE interest income, yields and ratios are substitutes for interest income, yields and ratios, as determined in accordance with U.S. GAAP.

As noted above, in calculating the ACL, management weighs different scenarios, including a baseline (most likely) scenario and an adverse scenario. At MarchJune 31,30, 2026, management applied a 50% weighting to the baseline scenario and applied a 50% weighting to the adverse scenario. To create hypothetical sensitivity analyses, management calculated a quantitative allowance using a 100% weighting applied to a baseline scenario and a quantitative allowance using a 100% weighting applied to an adverse scenario. The adverse scenario assumes among other things that: (1) Russia’s invasion of Ukraine will persist longer than expected. Risk increases that China might block the Taiwan Strait. Business and consumer confidence declines. Declines in European economies and retaliatory tariffs hurt US exports and corporate earnings in subsidiaries. (2) The conflictnegotiations between the USU.S. and Iran resultstake much longer than expected. Furthermore, the damage to energy infrastructure is worse than expected and takes longer to repair. As a result, the decline in oil prices in the Straitthird ofquarter Hormuzis being closed longerless than expectedin causingthe oilBaseline pricesforecast, to riseabout to $107$98 per barrel infor Q2 2026Brent, compared towith $76about $91 in baseline.the Baseline forecast. (3) The combination of recession and rising inflation cause the Federal Reserve to lower federal funds rates in Q2Q3 2026 but only slightly below baseline for a couple of quarters. As the recession persists and inflation subsides the Federal Reserve subsequently reduces the federal funds rate more significantly. (4) Europe goes into a recession as increased tariffs lower exports. Populism in Europe rises, raising uncertainties about longevity of the Euro zone and causes financial stress to highly indebted nations, especially Italy. These developments further lower US exports and corporate earnings of foreign subsidiaries of US companies. (5) The tariff rate rises to 19%,15%, more than the 11%8% in baseline, and it remains there through the end of 2028. There is full and permanent extension of the Tax Cuts and Jobs Act with enhancements included in the One Big Beautiful Bill Act. Growth in Medicaid and food assistance funding is reduced but rising health care costs will keep upward pressure on public health spending and the discretionary non-defense budget is capped below historic average. Defense spending is expected to grow. Tax revenues are lower than in the baseline creating a higher deficit and concerns about national debt level raises uncertainty over the course of tax policy. Though no crisis materializes, business and consumer sentiment is damaged. (6) Recession Q1Q2 2026 and lasts through Q4Q1 20262027 and real GDP declines by 2.6%. Unemployment rate rises to a peak of 8.5% Q2in Q3 2027. StockThe stock market falls 35% from Q1Q2 2026 to Q4Q1 2026.2027. Excluding consideration of qualitative adjustments, this sensitivity analysis would result in a hypothetical increase in Park's ACL of $32.5$31.6 million as of MarchJune 31,30, 2026 if only the adverse scenario was used. Excluding consideration of qualitative adjustments, a corresponding $32.5$31.6 million decrease in Park's ACL would occur in a hypothetical scenario if only the baseline (most likely) scenario was used.

The valuation of loans acquired in a business combination is a critical accounting estimate due to the significant judgment required in estimating expected cash flows, credit losses, and discount rates. Following adoption of ASU 2025‑08, acquired loans are accounted for using a gross‑up approach, with expected credit losses recorded as an adjustment to the loan’s amortized cost basis rather than through a day 1 provision for credit loss expense. Determining the acquisition‑date fair value of these loans involves estimating the principal and interest cash flows expected to be collected, considering a number of factors including the remaining contractual life of the loans, delinquency status, estimated prepayment behavior, payment options and other loan features, internal risk grades, estimated values of underlying collateral, and the prevailing interest rate environment. Changes in these assumptions could materially affect future earnings Acquisition of First Citizens On February 1, 2026, First Citizens Bancshares, Inc., a Tennessee corporation (“First Citizens”) merged into Park, with Park continuing as the surviving corporation. Immediately following the merger, First Citizens National Bank ("FCNB"), a national banking association and a wholly-owned subsidiary of First Citizens, merged into The Park National Bank ("PNB"),PNB, with PNB as the surviving bank. FCNB’s former operations now comprise Park’s newly established Tennessee region.

On the acquisition date, First Citizens had $2.6 billion in total assets, $1.6 billion in total loans, and $2.2 billion in total deposits. The acquisition was valued at $324.1 million and resulted in Park issuing 1,988,131 Park common shares as merger consideration in exchange for First Citizens outstanding common stock. For the threesix months ended MarchJune 31,30, 2026, Park recorded merger-related expenses of $15.5$19.6 million associated with the First Citizens acquisition.

The First Citizens acquisition was accounted for under the acquisition method of accounting. Assets acquired and liabilities assumed in the acquisition were recorded at their estimated fair values as of the acquisition date. These estimates were recorded based on preliminary valuations, and these estimates, including the initial accounting for deferred taxes, are considered preliminary as of MarchJune 31,30, 2026, and subject to adjustment for up to one year after the acquisition date. Accordingly, the preliminary estimates and assumptions are subject to change and the final acquisition accounting may differ materially from the amounts presented herein.

For the Three and Six Months Ended MarchJune 31,30, 2026 and 2025

Net income for the three months ended MarchJune 31,30, 2026 of $41.7$58.8 million represented a $470,000,$10.6 million, or 1.1%,22.1%, decreaseincrease compared to $42.2$48.1 million for the three months ended MarchJune 31,30, 2025. Pre-tax, pre-provision net income for the three months ended MarchJune 31,30, 2026 of $54.3$77.4 million represented a $2.4$15.2 million, or 4.6%,24.5%, increase compared to $52.0$62.2 million for the three months ended MarchJune 31,30, 2025.

The following discussion provides additional information regarding Park's financial results for the second quarter and first quarterhalf of 2026.

The following table reflects Park's net income for the first and second quarters (of 2026, for the threefirst months ended March 31)half of 2026 and 2025,2025 (the six months ended June 30), and for the yearsyear ended December 31, 2025 and 2024.2025.

Net interest income of $125.8$264.6 million for the threesix months ended MarchJune 31,30, 2026 represented a $21.4$51.3 million, or 20.5%,24.0%, increase compared to $104.4$213.4 million for the threesix months ended MarchJune 31,30, 2025. The increase was a result of a $22.6$58.4 million increase in interest income, partially offset by a $1.2$7.1 million increase in interest expense. The $22.6$58.4 million increase in interest income was due to a $21.4$50.5 million increase in interest income on loans and a $1.2$7.9 million increase in investment income.

The $21.4$50.5 million increase in interest income on loans was primarily the result of a $1.26$1.51 billion (or 16.04%19.22%) increase in average loans, from $7.83$7.88 billion for the threesix months ended MarchJune 31,30, 2025 to $9.09$9.39 billion for the threesix months ended MarchJune 31,30, 2026, as well as an increase in the yield on loans, which increased 107 basis points to 6.36%6.39% for the threesix months ended MarchJune 31,30, 2026, compared to 6.26%6.32% for the threesix months ended MarchJune 31,30, 2025. Interest income on loans was impacted by the acquisition of First Citizens on February 1, 2026. The newly formed Tennessee region contributed $17.4$42.1 million to loan interest income during the threesix months ended MarchJune 31,30, 2026.

The $1.2$7.9 million increase in investment income was primarily the result of a $241.7$443.6 million (or 17.55%32.78%) increase in average investments, including money market investments, from $1.38$1.35 billion for the threesix months ended MarchJune 31,30, 2025 to $1.62$1.80 billion for the threesix months ended MarchJune 31,30, 2026. This increase was partiallyalso offsetimpacted by aan decreaseincrease in the yield on investments, including money market investments, which decreasedincreased 168 basis points to 3.34%3.54% for the threesix months ended MarchJune 31,30, 2026, compared to 3.50%3.46% for the threesix months ended MarchJune 31,30, 2025.

The increase in interest expense on deposits was the result of a $1.32$1.64 billion (or 22.74%28.29%) increase in average on-balance sheet interest bearing deposits from $5.79$5.78 billion for the threesix months ended MarchJune 31,30, 2025, to $7.11$7.42 billion for the threesix months ended MarchJune 31,30, 2026. This increase was partially offset by a decrease in the cost of deposits of 149 basis points, from 1.76%1.75% for the threesix months ended MarchJune 31,30, 2025 to 1.62%1.66% for the threesix months ended MarchJune 31,30, 2026. Interest expense on deposits was impacted by the acquisition of First Citizens which contributed $6.9$17.7 million to interest expense on deposits during the threesix months ended MarchJune 31,30, 2026.

The decrease in interest expense on borrowings was the result of a decrease in the cost of borrowings of 186165 basis points, from 3.94%3.93% for the threesix months ended MarchJune 31,30, 2025 to 2.08%2.28% for the threesix months ended MarchJune 31,30, 2026 as well as a $149.2$141.0 million (or 55.41%52.37%) decrease in average borrowings from $269.3$269.2 million for the threesix months ended MarchJune 31,30, 2025, to $120.1$128.2 million for the threesix months ended MarchJune 31,30, 2026. The balance of average borrowings was impacted by the redemption of subordinated debt. On September 1, 2025, $175.0 million of subordinated debt was repaid, followed by an additional repayment of $15.0 million of subordinated debt on September 30, 2025.

The provision for credit losses of $2.7$7.2 million for the threesix months ended MarchJune 31,30, 2026 represented an increase of $1.9$3.6 million, compared to $756,000$3.6 million for the threesix months ended MarchJune 31,30, 2025. Refer to the “Credit Metrics and Provision for Credit Losses” section for additional details regarding the level of the provision for credit losses recognized in each period presented.

Other income of $33.7$73.3 million for the threesix months ended MarchJune 31,30, 2026 represented an increase of $8.0$15.3 million, or 31.0%,26.5%, compared to $25.7$57.9 million for the threesix months ended MarchJune 31,30, 2025. Total other income was impacted by the acquisition of First Citizens,Citizens which added $2.8$6.9 million to total other income for the threesix months ended MarchJune 31,30, 2026. Refer to the “Other Income” section for additional details regarding the change in other income for the threesix months ended MarchJune 31,30, 2026 compared to the threesix months ended MarchJune 31,30, 2025.

Total other expense of $105.2$206.1 million for the threesix months ended MarchJune 31,30, 2026 represented an increase of $27.0$49.0 million compared to $78.2$157.1 million for the threesix months ended MarchJune 31,30, 2025. Included within total other expense arewere merger-related costs, along with the expanded other expense base that stems from the acquisition of First Citizens. Total other expense for the threesix months ended 2026 included $15.5$19.6 million in merger-related expenses and $10.1$24.7 million related to Park's newly formed Tennessee region and other acquired entities. Refer to the “Other Expense” section for additional details regarding the change in other expense for the threesix months ended MarchJune 31,30, 2026 compared to the threesix months ended MarchJune 31,30, 2025.

The table below provides certain balance sheet information and financial ratios for Park as of or for the threesix months ended MarchJune 31,30, 2026 and 2025 and the year ended December 31, 2025.

(1) Average assets for the threesix months ended MarchJune 31,30, 2026 and 2025 and for the year ended December 31, 2025.

(2) Efficiency ratio is calculated by dividing total other expense by the sum of fully taxable equivalent net interest income and other income. Fully taxable equivalent net interest income includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate. The taxable equivalent adjustments were $985,000,$1.9 $607,000million, $1.3 million and $2.7 million, respectively, for the threesix months ended MarchJune 31,30, 2026 and 2025 and the year ended December 31, 2025, respectively.

Loans outstanding at MarchJune 31,30, 2026 were $9.67$9.73 billion, compared to (i) $8.05 billion at December 31, 2025, an increase of $1.62$1.68 billion, and (ii) $7.88$7.96 billion at MarchJune 31,30, 2025, an increase of $1.78$1.77 billion. The table below breaks out the change in loans outstanding, by loan type.

Excluding loans outstanding in Park's newly formed Tennessee region, loans outstanding at MarchJune 31,30, 2026 were $8.09$8.14 billion, compared to (i) $8.05 billion at December 31, 2025, an increase of $39.7$93.7 million, and (ii) $7.88$7.96 billion at MarchJune 31,30, 2025, an increase of $207.2$181.7 million. The table below breaks out the change in loans outstanding, by loan type.

Park's allowance for credit losses was $108.6$110.7 million at MarchJune 31,30, 2026, compared to $93.0 million at December 31, 2025, an increase of $15.6$17.7 million, or 16.8%.19.1%. Refer to the “Credit Metrics and Provision for Credit Losses” section for additional information regarding Park's loan portfolio and the level of provision for credit losses recognized in each period presented.

Total deposits at MarchJune 31,30, 2026 were $11.00$10.67 billion, compared to (i) $8.24 billion at December 31, 2025, an increase of $2.76$2.43 billion and (ii) $8.20$8.24 billion at MarchJune 31,30, 2025, an increase of $2.80$2.43 billion. Total deposits including off balance sheet deposits at MarchJune 31,30, 2026 were $11.00$10.67 billion, compared to (i) $8.35 billion at December 31, 2025, an increase of $2.65$2.32 billion and (ii) $8.45$8.49 billion at MarchJune 31,30, 2025, an increase of $2.55$2.18 billion.

Excluding total deposits in Park's newly formed Tennessee region, total deposits at MarchJune 31,30, 2026 were $8.76$8.51 billion, compared to (i) $8.24 billion at December 31, 2025, an increase of $514.3$270.6 million and (ii) $8.20$8.24 billion at MarchJune 31,30, 2025, an increase of $556.3$276.5 million. Total deposits, excluding total deposits in Park's newly formed Tennessee region, including off balance sheet deposits at MarchJune 31,30, 2026 were $8.76$8.51 billion, compared to (i) $8.35 billion at December 31, 2025, an increase of $409.0$165.3 million and (ii) $8.45$8.49 billion at MarchJune 31,30, 2025, an increase of $305.5$21.4 million.

During the threesix months ended MarchJune 31,30, 2026, total deposits including off balance sheet deposits increased by $2.65$2.32 billion, or 31.8%.27.8%. This increase consisted of a $1.45$1.21 billion increase in total commercial deposits, a $1.27$1.19 billion increase in retail deposits and a $30.4$23.3 million increase in brokered and bid CD deposits, partially offset by a $105.3 million decrease in off balance sheet deposits. The majority of off balance sheet deposits are commercial and thus impact the change in commercial deposits as the deposits are moved on or off the balance sheet.

1 Cost of funds for the threesix months ended MarchJune 31,30, 2026 and 2025 and for the year ended December 31, 2025.

As of MarchJune 31,30, 2026, Park had approximately $2.4$2.3 billion of uninsured deposits, which was 21.6%21.5% of total deposits. Uninsured deposits of $2.4$2.3 billion included $738$699 million of deposits that were over $250,000, but were fully collateralized by Park's investment securities portfolio.

Comparison for the FirstSecond Quarters of 2026 and 2025

Net interest income increased by $21.4$29.9 million, or 20.5%,27.4%, to $125.8$138.9 million for the firstsecond quarter of 2026, compared to $104.4$109.0 million for the firstsecond quarter of 2025. See the discussion under the table below.

(1) Loan interest income includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate. The taxable equivalent adjustment was $393,000$369,000 for the three months ended MarchJune 31,30, 2026 and $270,000$275,000 for the same period of 2025.

(2) Interest income on tax-exempt investment securities includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate. The taxable equivalent adjustment was $592,000$564,000 for the three months ended MarchJune 31,30, 2026 and $337,000$400,000 for the same period of 2025.

Average interest earning assets for the firstsecond quarter of 2026 increased by $1.50$2.41 billion, or 16.3%,26.1%, to $10.71$11.66 billion for the firstsecond quarter of 2026, compared to $9.21$9.25 billion for the firstsecond quarter of 2025. The average yield on interest earning assets increased by 51 basis points to 5.90%5.96% for the firstsecond quarter of 2026, compared to 5.85%5.95% for the firstsecond quarter of 2025.

Average interest bearing liabilities for the firstsecond quarter of 2026 increased by $1.17$1.82 billion, or 19.3%,30.1%, to $7.23$7.86 billion, compared to $6.06$6.04 billion for the firstsecond quarter of 2025. The average cost of interest bearing liabilities decreased by 2312 basis points to 1.63%1.71% for the firstsecond quarter of 2026, compared to 1.86%1.83% for the firstsecond quarter of 2025.

Interest income and interest expense for the three months ended MarchJune 31,30, 2026 and MarchJune 31,30, 2025, included purchase accounting accretion on loans and deposits, as well as payments received on former Vision Bank impaired loan relationships, some of which were participated with PNB. The tables below show the impact of these items on interest earning assets and interest bearing liabilities.

(1) Loan interest income includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate. The taxable equivalent adjustment was $393,000$369,000 for the three months ended MarchJune 31,30, 2026.

(2) Interest income on tax-exempt investment securities includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate. The taxable equivalent adjustment was $592,000$564,000 for the three months ended MarchJune 31,30, 2026.

(1) Loan interest income includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate. The taxable equivalent adjustment was $270,000$275,000 for the three months ended MarchJune 31,30, 2025.

(2) Interest income on tax-exempt investment securities includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate. The taxable equivalent adjustment was $337,000$400,000 for the three months ended MarchJune 31,30, 2025.

Yield on Loans: Average loan balances increased $1,256.5$1.77 million,billion, or 16.0%,22.3%, to $9,090$9.69 millionbillion for the firstsecond quarter of 2026, compared to $7,833$7.92 millionbillion for the firstsecond quarter of 2025. The average yield on the loan portfolio increased by 105 basis points to 6.36%6.42% for the firstsecond quarter of 2026, compared to 6.26%6.37% for the firstsecond quarter of 2025.

The table below shows the average balance and tax equivalent yield by type of loan for the three months ended MarchJune 31,30, 2026 and 2025.

(1) Commercial loan interest income includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate. The taxable equivalent adjustment was $393,000$369,000 for the three months ended MarchJune 31,30, 2026 and $270,000$275,000 for the same period of 2025.

Interest income for the three months ended MarchJune 31,30, 2026 and MarchJune 31,30, 2025, included purchase accounting accretion on loans, as well as payments received on former Vision Bank impaired loan relationships, some of which were participated with PNB. The tables below show the impact on the tax equivalent yield by type of loan excluding the impact of these items.

(1) Commercial loan interest income includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate. The taxable equivalent adjustment was $393,000$369,000 for the three months ended MarchJune 31,30, 2026 and $270,000$275,000 for the same period of 2025.

Cost of Deposits: Average interest bearing deposit balances increased $1.32$1.95 billion, or 22.7%,33.8%, to $7.11$7.72 billion for the firstsecond quarter of 2026, compared to $5.79$5.77 billion for the firstsecond quarter of 2025. The average cost of funds on deposit balances decreased by 143 basis points to 1.62%1.70% for the firstsecond quarter of 2026, compared to 1.76%1.73% for the firstsecond quarter of 2025. The table below shows for the three months ended MarchJune 31,30, 2026 and 2025, the average balance and cost of funds by type of deposit.

Interest expense for the three months ended MarchJune 31,30, 2026 included purchase accounting accretion on deposits. The table below shows the impact on the tax equivalent yield by type of deposit excluding the impact of these items. There was no purchase accounting accretion on deposits for the three months ended MarchJune 31,30, 2025.

(1) Loan interest income includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate. The taxable equivalent adjustment was $393,000$763,000 for the threesix months ended MarchJune 31,30, 2026,2026 and $1.1 million, $964,000 and $811,000$545,000 for the yearssame endedperiod Decemberof 31, 2025, 2024 and 2023, respectively.2025.

(2) Interest income on tax-exempt investment securities includes the effects of taxable equivalent adjustments using a 21% federal corporate income tax rate. The taxable equivalent adjustment was $592,000 for the three months ended March 31, 2026, and $1.5 million, $1.5 million and $2.9$1.2 million for the yearssix months ended DecemberJune 31,30, 2025, 20242026 and 2023,$737,000 respectively.for the same period of 2025.