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

Lack of funding, liquidity, or access to capital could impair our business and financial condition. An inability to maintain adequate funding and liquidity to operate our business could have a significant negative effect on our financial condition. We have a contingency funding plan which would guide our actions if one or more of our businesses were to experience disruptions from normal funding and liquidity sources. If the available funding from one or more of our contingent funding sources is not sufficient to sustain normal operating levels, we may be required to scale back or curtail our operations, such as by limiting lending, selling assets at unfavorable prices, cuttingreducing or eliminating dividend payments, or limiting our recruiting of financial advisors. Our liquidity could be negatively affected by: any inability of our subsidiaries to generate cash to distribute to the parent company, liquidity or capital requirements that may prevent our subsidiaries from distributing cash, limitations on our subsidiaries’ access to credit markets for secured and unsecured borrowings, diminished access to the credit and capital markets, and other commitments or restrictions on capital as a result of adverse legal settlements, judgments, regulatory sanctions, or an adverse change in our credit rating by one or more of the national rating agencies. Furthermore, as a bank holding company, we may become subject to prohibitions or limitations on our ability to pay dividends to our shareholders and/or repurchase our stock. Certain of our regulators have the authority, and under certain circumstances, the duty, to prohibit or to limit dividend payments by regulated subsidiaries to their parent company.

We rely heavily on bank deposits as a low-cost source of funding for Stifel Bancorp to extend loans to clients and purchase investment securities. Our bank deposits are primarily driven by our multi-bank sweep program in which clients’ cash deposits in their brokerage accounts are swept into FDIC-insured interest-bearing accounts at our bank subsidiaries and various third-party banks. During 2025, we have seen an increase in deposits from our commercial, venture banking, and fund banking clients. A significant reduction in our domestic clients’ cash balances, a change in the allocation of that cash between our bank subsidiaries and third-party banks, a movement of cash away from our company, or an inability to implement new or modified deposit offerings in order to retain or grow our client base, could significantly impact our ability to continue growing interest-earning assets and/or require us to use higher-cost deposit sources to grow interest-earning assets. Rapidly rising rates, for example, have made and may continue to make investments in securities, such as fixed income securities and money market funds, more attractive for investors, thereby incentivizing them to reduce the cash they hold.

A credit rating downgrade would also result in the Company incurring a higher facility fee on its $750$1.0 millionbillion unsecured revolving credit facility agreement (the “Credit Facility”), in addition to triggering a higher interest rate applicable to any borrowings outstanding on the line as of and subsequent to such downgrade. See “Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” of this Form 10-K and Note 11 of the Notes to Consolidated Financial Statements of this Form 10-K for information on the Credit Facility.

We are exposed to market risk, including interest rate risk. Market risk generally represents the risk that values of assets and liabilities or revenues will be adversely affected by changes in market conditions, which directly and indirectly affect us. Market conditions that change from time to time, thereby exposing us to market risk, include fluctuations in interest rates, equity prices, foreign exchange rates, and price deterioration or changes in value due to changes in market perception,perception actualof the credit quality of an issuer, or other factors.

In our brokerage operations, increases in short-term interest rates have historically resulted in an increase in our net earnings, and we expect decreases in short-term interest rates to generally reduce our net earnings, although there may be offsetting favorable impacts. As it relates to our net interest income, the magnitude of the effect of a decrease in short-term interest rates depends on a number of factors impacting balances, asset yields, and the cost of funding. The magnitude of the impact to our net interest margin depends on the yields on interest-earning assets relative to the cost of interest-bearing liabilities, including deposit rates paid to clients on their cash balances. Decreases in short-term interest rates generally also result in a decrease to fees earned from third-party banks, although the magnitude of the impactdecline may also be impacted by demand for cash balances by third-party banks and the rate paid to clients on their cash sweep balances. Rates paid to clients on their cash balances are generally impacted by the level of short-term interest rates, as well as competitive industry dynamics and the demand for client cash. Additionally, any future changes to regulatory rules or interpretations governing the fees the firm earns on cash sweep balances could also impact the rates we pay to clients on cash balances. If we are unable to effectively manage our interest rate risk, changes in interest rates could have a material adverse effect on our profitability.

In addition, disruptions in the liquidity or transparency of the financial markets may result in our inability to sell, syndicate, or realize the value of security positions, therebypotentially leading to increased concentrations. The inability to reduce our positions in specific securities may not only increase the market and credit risks associated with such positions, but also increase the level of risk-weighted assets on our balance sheet, thereby increasing our capital requirements, which could have an adverse effect on our business results, financial condition and liquidity.

Our business is sensitive to domestic and international macroeconomic conditions caused by political and geopolitical developments, fiscal, monetary, and tax policies, regulations, and other domestic and international events. We are engaged in various financial services businesses. As such, we are affected by domestic and international macroeconomic and political conditions, as well as economic output levels, interest and inflation rates, employment levels, prices of commodities, consumer confidence levels, changes in consumer spending, international trade policy, and fiscal and monetary policy. For example, Fed policies determine, in large part, interest rates and the cost of funds which directly affect the returns and fair value on our lending and investing activities. The market impact from such policies can also materially decrease the value of certain of our financial assets, most notably debt securities, as well as our cash flows. In addition, our results of operations may be impacted by governmental policy changes resultingand/or fromregulatory differentreform politicalin philosophiesmultiple governingareas, individualincluding tax, international trade, immigration, healthcare, labor, infrastructure, and corporateenergy. taxation,While asthere wellis asuncertainty regulation, which may result fromaround the outcometiming of themany recentsuch federalpotential electionschanges, insuch the U.S. For example, changes to tax laws and regulations, including various provisions of the TCJA which will expire in 2025 if not extended, may negatively impact our effective income tax rate, financial results, or the amount of any tax assets or liabilities. Changes in tax law and regulation,changes, or any market uncertainty caused by a potential change in thegovernmental political environment,policies, may also affect our clients and, directly or indirectly, our business. Furthermore, over the last several years, the federal government has shut down multiple times, in some cases for prolonged periods, and it is possible that the federal government may shut down again in the future. Although the recent government shutdown is not expected to materially affect our results of operations, any prolonged future shutdown could significantly impact business and economic conditions generally or specifically in our key markets, which could have a material adverse effect on our results and financial condition. Macroeconomic conditions may also be negatively affected by domestic or international events, including natural disasters, political unrest, the indirect impact of wars and conflicts, such as the wars in Ukraine and Israel, or public health epidemics and pandemics, as well as by a number ofseveral factors in the global financial markets that may be detrimental to our operating results, including trading levels, investing, and origination activity in the securities markets, security valuations, the absolute and relative level and volatility of interest and currency rates, real estate values, the actual and perceived quality of issuers and borrowers, and the supply of and demand for loans and deposits.results.

As a market-maker, we may take ownership of positions in specific securities, and these undiversified holdings concentrate the risk of market fluctuations and may result in greater losses than would be the case if our holdings were more diversified. Despite risk mitigation policies,policies and practices, we may incur losses as a result of positions we hold in connection with these activities.

We deposit our cash in depository institutions as a means of maintaining the liquidity necessary to meet our operating needs, and we also facilitate the deposit of cash awaiting investment in depository institutions on behalf of our clients. Many of these deposits exceed FDIC-insured limits. Recent events in the financial services industry, including the failure of certain banks, have increased counterparty credit risk. While we perform extensive diligence on the banks we select to hold these deposits, a failure of one or more of these depository institutions to return these deposits could affect our operating liquidity, result in reputational damage, and impair our financial performance.

We face intense competition and pricing pressures and may not be able to keep pace with technological change. We are engaged in intensely competitive businesses. We compete on the basis of a number of factors, including the quality of our associates,associates and financial advisors, our products and services, pricing (such as execution pricing and fee levels), technology solutions, and location and reputation in relevant markets. Over time, there has been substantial consolidation and convergence among companies in the financial services industry, which has significantly increased the capital base and geographic reach of our competitors. See “Item 1 – Business - Competition” of this Form 10-K for additional information about our competitors.

Although we currently do not use AI extensively, we may in the futureWe use, develop, and incorporate within our technology platform and services, systems and tools that incorporate AI and machine learning, including generative AI. Although we strive to establish and maintain appropriate governance and risk management processes, ineffective or inadequate AI development or deployment practices by us or third-party vendors could result in unintended consequences, such as AI algorithms that produce inaccurate output or that are based on biased, incomplete, and/or inaccurate datasets. Despite implementing polices and safeguards to prevent unauthorized disclosures, our use of AI may still pose heightened security and privacy risks, which we seek to mitigate by relying on proprietary or “walled-garden” environments to enhance data protection and operational controls and maintain confidentiality. Any of the foregoing may result in harm to our business, results of operations, or reputation. Compliance with new or changing laws, regulations, or industry standards relating to AI may impose significant operational costs and limit our ability to develop, deploy, or use AI and machine learning technologies.

A continued interruption to our telecommunications or data processing systems, or the failure to effectively update the technology we utilize, could be materially adverse to our business. Our businesses rely extensively on data processing and communications systems.systems, including both third-party and internally developed technology solutions. In addition to better serving clients, the effective use of technology increases efficiency and enables us to reduce costs. Adapting or developing our technology systems to meet new regulatory requirements, client needs, and competitive demands is critical for our business. Introduction of new technology presents challenges on a regular basis. There are significant technical and financial costs and risks in the development of new or enhanced applications, including the risk that we might be unable to effectively use new technologies, adapt our applications to emerging industry standards, or keep applications current as it relates to vulnerabilities and security controls.

Cyber attack or other security breach of our technology systems, or those of other third-partythird vendorsparties we rely on, could subject us to significant liability and reputational harm. Our operations rely heavily on the secure processing, storage, and transmission of sensitive and confidential financial, personal, and other information in our computer systems and networks. There have been numerous highly publicized cases involving financial services companies reporting the unauthorized disclosure of client or other confidential information in recent years, as well as cyber attacks involving the theft, dissemination, and destruction of corporate information or other assets, in some cases as a result of failure to follow procedures by employees or contractors or as a result of actions by third parties. There have also been numerous highly publicized cases where hackers have requested “ransom” payments in exchange for not disclosing customer information or for restoring access to information or systems. Like other financial services firms, we experience malicious cyber activity directed at our computer systems, software, networks, and its users on a daily basis. This malicious activity includes attempts at unauthorized access, implantation of computer viruses or malware, and denial-of-service attacks. We also experience large volumes of phishing and other forms of social engineering attempted for the purpose of perpetrating fraud against our company, our associates, our advisors, or our clients. Additionally, like many large enterprises, we provide secure remote work capabilities, which can introduce potential cyber vulnerabilities as well.

We also face increased cybersecurity risk for a period of time after acquisitions as we transition the acquired entity’s historical systems and networks to our standards. We also face additional cybersecurity risk related to an increased focus on mobile and cloud technologies.technologies and reliance on external service providers. Our reliance on public cloud services introduces cybersecurity risks, including potential data breaches, unauthorized access, and compromised application programming interfaces (APIs) which could impact the confidentiality, integrity, or availability of our systems and data. Cloud-related risks may also arise from misconfiguration, weaknesses in identity and access controls, vulnerabilities in cloud workloads, and failures or outages at cloud service providers. Likewise, our mobile and web-facing technologies expose us to risks such as data leakage, malicious applications, phishing attacks, and network level threats which pose similar risks. We seek to continuously monitor for and nimbly react to any and all such malicious cyber activity, and we develop our systems to protect the confidentiality, integrity, and availability of our data and technology infrastructure and data from misuse, misappropriation, or corruption. We also rely on numerous third-party service providers to conduct aspects of our business operations and face similar risks relating to those third parties, including operational disruptions, security weaknesses, delayed incident notification, and supply chain risks.

Cyber attacks can originate from a variety of sources, including threat actors affiliated with foreign governments, organized crime, or terrorist organizations. Threat actors may also attempt to place individuals within our company or induce associates, clients, or other users of our systems to disclose sensitive information or provide access to our data, and these types of risks may be difficult to detect or prevent. Although cybersecurityCybersecurity incidents among financial services firms are on the rise, we have not experienced any material losses relating to cyber attacks or other information security breaches. However,and the techniques used in these attacks are increasingly sophisticated, change frequentlyfrequently, and are often not recognized until launched. AlthoughTo date, we seekhave not experienced any cybersecurity incidents that we have determined to maintain a robust suite of layered information security controls, including our cyber threat analytics, data encryption, and monitoring technologies, anti-malware defenses, and vulnerability management programs, any one or combination of these controls could fail to detect, mitigate, or remediate these risks in a timely manner. Despite our implementation of protective measures and endeavoring to modify them as circumstances warrant, our computer systems, software, and networks may be vulnerable to human error, equipment failure, natural disasters, power loss, unauthorized access, supply chain attacks, distributed denial of service attacks, zero-day vulnerabilities, computer viruses and other malicious code, and other events that could result in significant liability and damagematerial to our reputation,business, andfinancial havecondition, anor ongoing impact on the security and stabilityresults of our operations. In addition, although we maintain insurance coverage that may, subject to terms and conditions, cover certain aspects of cyber and information security risks, such insurance coverage may be insufficient to cover all losses, such as litigation costs or financial losses that exceed our policy limits or are not covered under any of our current insurance policies.

Notwithstanding the precautions we take, if a cyber attack or other information security breach were to occur, this could jeopardize theconfidential information we confidentiallymaintain maintain,and or otherwisecould cause interruptions in our operations or those of our clients and counterparties, exposing us to liability. As attempted attacks continue to evolve in scope and sophistication, we may be required to expend substantial additional resources to modify or enhance our protective measures, to investigate and remediate vulnerabilities or other exposuresexposures, or to communicate about cyber attacks to our customers and regulators. A technological breakdown could also interfere with our ability to comply with financial reporting and other regulatory requirements, exposingpotentially usresulting to potentialin disciplinary action by regulators. Further,In addition, successful cyber attacks at other large financial institutions or other market participants, whether or not we are directly affected, could lead to a general loss oferode confidence in financial institutions thatgenerally couldand negativelyin affectour us,firm specifically, including harming the market perceptionperceptions of the effectiveness of our security measures or the financial system in general,measures, which could resultreduce indemand reduced use offor our financial products and services. We maintain incident response, business continuity, and remediation programs designed to mitigate these impacts and to support timely regulatory reporting and recovery.

Further,Given in light of theour high volumetransaction ofvolumes, transactionsremote-work weenvironment, process, use of remote work,and the large number of our clients, partners, and counterparties,counterparties andwe the increasing sophistication of malicious actors,serve, a cyber attack could occur. Moreover,Such any such cyberan attack may persist for an extended period of time without detection. WeInvestigations endeavorcan torequire designsubstantial time and implement policiesresources, and procedures to identify such cyber attacks as quickly as possible; however, we expect that any investigation of a cyber attack would take substantial amounts of time, and that there may be extensivesignificant delays before we obtain fullcomplete and reliable information. During suchan time,extended investigation, we wouldmay not necessarily know the full extent of the harm or howthe bestoptimal toremediation remediate it,path, and certain errors or malicious actions could be repeated or compounded before they are discoveredidentified and remediated, all of which wouldcould furthersignificantly increase the costs and consequences of such an attack. Our Security Operations Center is designed to contain attacks and to support incident investigation and remediation, but notwithstanding these capabilities, detection or remediation may be delayed in some circumstances.

We may also be subject to liability under various data protection and privacy laws. In providing services to clients, we manage,collect, utilize,use, store, and storetransmit sensitive or confidential client orand associate data,information, including personal data.data, As a result, weand are subject to numerousan lawsevolving andmatrix regulations designed to protect this information, such asof U.S. federal, state, and international privacy and data-protection laws governingand regulations, including, where applicable, the protectionGramm-Leach-Bliley ofAct personally(GLBA), identifiablethe information.EU General Data Protection Regulation (GDPR), and state consumer privacy laws such as the CCPA/CPRA. These laws and regulations are increasing in complexity and number.may impose obligations related to data security, breach notification, cross-border data transfers, data subject rights, and recordkeeping. If any person, including anyan ofassociate ouror associates,a third-party service provider, negligently disregards or intentionally breaches our established controls with respect to client or associate data, or otherwise mismanages or misappropriates such data, we could be subject toincur significant monetary damages, regulatory enforcement actions, fines, and/or criminal prosecution.penalties. In addition, unauthorizedUnauthorized disclosure of sensitive or confidential client or associate data, whether through system failure, associatehuman negligence,error, fraud, or misappropriation,third-party compromise, could damage our reputation andreputation, cause usloss to loseof clients and related revenue.revenue, Potentialand liabilityexpose inus theto eventsubstantial of a security breach of client data could be significant.liability. Depending on the circumstances giving rise to thea breach, this liability may not be subject to a contractual limitlimits or anexclusions exclusion offor consequential or indirect damages. Further, lapsesLapses in our cybersecurity or privacy controls, asor perceivedregulatory byfindings that our regulators,controls are inadequate, could lead to finesfines, andpenalties, penaltiesor compoundingother remediation obligations that would compound monetary losses. We maintain a privacy governance framework that includes a designated privacy lead, a documented data inventory and mapping process, privacy impact assessments for high-risk processing, technical controls, such as encryption and data-loss prevention, and contractual requirements for processors and other third parties to meet our security and privacy obligations. Our incident response and escalation procedures incorporate regulatory notification requirements and roles to support timely reporting and cooperation with regulators.

Financial services firms are subject to numerous actual or perceived conflicts of interest, which are routinely examined by regulators and SROs such as FINRA and aremay oftenbe used as the basis for claims for legal liability by plaintiffs in actions against the Company. OurThrough our risk management processesprocesses, includewe addressingseek to address potential conflicts of interest that arise in our business. Management of potential conflicts of interest has becomebecomes increasingly complex as we expand our business activities.activities expand. A perceived or actual failure to address conflicts of interest adequately could affect our reputation, the willingness of clients to transact business with usus, or give rise to litigation or regulatory actions. Therefore, there can be no assurance that conflicts of interest will not arise in the future that could result in material harm to our business and financial condition.

Associate misconduct, which is difficult to detect and deter, could harm us by impairing our ability to attract and retain clients and subject us to significant legal liability and reputational harm. There is a risk that our associates could engage in misconductmisconduct, fraudulent, unauthorized, or illegal acts, or noncompliance with firm policies or regulations that adversely affects our business.business and/or results in substantial liability. For example, our investment banking business often requires that we dealappropriately withmanage the use of our institutional clients’ non-public, confidential mattersinformation. Similarly, many of great significance to our clients. Our associates interact routinely with clients, customers,clients and counterparties on an ongoing basis. All associatesand are expected to exhibitcomply thewith behaviorsour policies and ethics that are reflected in our framework of principles, policies, and technologyprocedures to protect both our own information as well as that of our clients. If our associates improperly use or discloseclients’ confidential information providedand our own. If confidential information, for example, is improperly used or disclosed by ourany clients,associate, we could be subject to future regulatory sanctionsaction and suffer serious harm to our reputation, financial position, current client relationships, and ability to attract future clients. WeAdditionally, areassociate also subject to a number of obligations and standards arising from our asset management business and our authority over our assets under management. In addition, our financial advisors are required to act in the best interests of our clients and may act in a fiduciary capacity, providing financial planning, investment advice, and discretionary asset management. The violation of these obligations and standards by any of our associates would adversely affect our clients and us. Associate conductmisconduct on non-business matters, such as social issues, including the posting of information on social media or other internet forums, could be inconsistent with our policies and ethicsvalues and result in reputational harm to our business due to their employment by us or affiliation with us. It is not always possible to deter or prevent every instance of associate misconduct, and the precautions we take to detect and prevent this activity may not be effective in all cases. If our associates engage in misconduct, our business wouldcould be adversely affected.

We are subject to risks relating to environmental, social, and governance matters that could adversely affect our reputation, business, financial condition, and results of operations. We are subject to a variety of risks, including reputational risk, associated with environmental, social, and governance matters. As a large financial institution, we have multiple stakeholders, including our shareholders, clients, associates, federalfederal, state, and stateforeign regulatory authorities, and the communities in which we operate, and these stakeholders will often have differing priorities and expectations regarding suchenvironmental, social, and governance matters. For example, individual U.S. states are increasingly developing differing, and sometimes conflicting, rules related to environmental, social, and governance matters, while at the federal level, the SEC has recently stopped pursuing rulemaking efforts focused on certain of these matters. In addition, proxy advisory firms and certain institutional investors who manage investments in public companies may integrate environmental, social, and governance factors into their investment analysis. Frameworks for evaluating such matters remain underdeveloped and vary widely, which may lead to misperceptions of our policies and practices. Organizations that provide ratings information to investors on such matters may also assign unfavorable ratings to Stifel. Stakeholders continue to focus on environmental, social, and governance issues in corporate actions, such as the election of directors and approval of executive compensation. Certain of our clients might also require that we implement additional procedures or standards in these areas in order to continue to do business with them. If we take action in conflict with one or another of those stakeholders’ expectations, we could experience an increase in client complaints, a loss of business, or reputational harm. We could also face negative publicity or reputational harm based on the identity of those with whom we choose to do business. Any adverse publicity in connection with environmental, social, and governance issues could damage our reputation, our ability to attract and retain clientsclients, associates, and associates,independent advisors, compete effectively, and grow our business.

Moreover,Regulatory therescrutiny has been increased regulatory focus on theof disclosure practices of investment managers offeringfor sustainable and values-based investment strategies,strategies resultinghas been a focus in increasedrecent riskyears, though that focus appears to be moderating following the SEC’s decision to withdraw proposed rulemaking in this area. Nonetheless, we could bestill face reputational risk if our investment managers are perceived as making inaccurate or misleading statements regarding the investment strategies of our funds and ETFs, commonly referred to as “greenwashing.” Such perceptions or accusations could damage our reputation, result in litigation or regulatory enforcement actions, and adversely affect our business.

Financial services firms are highly regulated and are currently subject to a number of new and proposed regulations, all of which may increase our risk of financial liability and reputational harm resulting from adverse regulatory actions. Financial services firms operate in an evolving regulatory environment and are subject to extensive supervision and regulation. The laws and regulations governing financial services firms are intended primarily for the protection of our depositors, our clients, the financial system, and the FDIC insurance fund, not our shareholders or creditors. The financial services industry has experienced an extended period of significant change in laws and regulations, as well as a high degree of scrutiny from various regulators, including the SEC, the Fed, the FDIC, the OCC, the DOL, and the CFPB, in addition to stock exchanges, FINRA, and governmental authorities, such as state attorneys general. The SEC has recently been very active in proposing and adopting major new rules and regulations that affect public companies and, in particular, the financial services industry. Several of these new rules have been adopted after significantly abbreviated periods for public comments, and these new or proposed rules involve sweeping changes that could require significant shifts in industry operations and practices, thereby increasing uncertainty for markets and investors. Further, final and proposed rules and regulations have been increasingly subjected to legal challenge, which creates uncertainty in planning our compliance and could lead to increased compliance costs. Penalties and fines imposed by regulatory and other governmental authorities have also been substantial and growing in recent years. Additionally, an increasing number of U.S. states have proposed, or are considering, their own laws and regulations, and as a result, our activities could be subject to overlapping and conflicting regulation. We may be adversely affected by the adoption of new rules and by changes in the interpretation or enforcement of existing laws, rules, and regulations. Existing and new laws and regulations could negatively affect our revenue, limit our ability to pursue business opportunities, impact the value of our assets, require us to alter our business practices, impose additional compliance costs, and otherwise adversely affect our businesses.

The Federal Reserve requires a bank holding company to act as a source of financial and managerial strength for its subsidiary banks.banks The Federal Reserveand could require the Company to commit resources to its bank subsidiaries when doing so is not otherwise in the best interests of our company or its shareholders or creditors.

Regulatory actions brought against us may result in judgments, settlements, fines, penalties, or other results, any of which could have a material adverse effect on our business, financial condition, reputation, or results of operations. In particular, the banking regulators have broad enforcement power over bank holding companies and banks, including with respect to unsafe or unsound practices or violations of the law. There is no assurance that regulators will be satisfied with the policies and procedures implemented by our company and its subsidiaries. In addition, from time to time, the Company and its subsidiaries have been or may in the future become subject to additional findings with respect to supervisory, compliance, or other regulatory deficiencies, which could subject us to additional liability, including penalties, and restrictions on our business activities. Among other things, these restrictions could limit our ability to make investments, complete acquisitions, onboard new branches or financial advisors, expand into new business lines, pay dividends on our common and preferred stock, and/or engage in share repurchases. See “Item 1, Business – Regulation,” of this Form 10-K for additional information regarding our regulatory environment.

We are exposed to litigation and regulatory investigations and proceedings, which could materially and adversely impact our business operations and prospects. The financial services industry faces significant litigation and regulatory risks. Additionally, our litigation and regulatory risks continue to increase as our business expands internationally. Many aspects of our business involve substantial risk of liability. We have been named as a defendant or co-defendant in lawsuits and arbitrations primarily involving claims for damages. The risks associated with potential litigation often may be difficult to assess or quantify, and the existence and magnitude of potential claims often remain unknown for substantial periods of time. Unauthorized or illegal acts or noncompliance with firm policies by our associates could also result in substantial liability. We are also the subject of inquiries, investigations, and proceedings by regulatory and other governmental agencies.

In addition to the SEC, various states havemight adopted,consider or are considering adopting,adopting laws and regulations seekingthat towould impose new standards of conduct on broker-dealers that, as written,that differ from the SEC’s regulations and maycould lead to additional implementation costs. Implementation of the SEC regulations, as well as any new state rules that are adopted addressing similar matters, has resulted in (and may continue to result in) increased costs related to compliance, legal, operations, and information technology. Furthermore, certain non-U.S. jurisdictions have imposed heightened standards of conduct, which may have similar impacts on our business in those jurisdictions.

As a financial holding company, our company’s liquidity depends on payments from its subsidiaries, which may be subject to regulatory restrictions. The Company, as a financial holding company, depends on dividends, distributions, and other payments from its subsidiaries in order to meet its obligations, including its debt service obligations and to fund dividend payments and share repurchases. Our subsidiaries are subject to laws and regulations that restrict dividend payments or authorize regulatory bodies to prevent or reduce the flow of funds from those subsidiaries to our company. If our subsidiaries are unable to make dividend payments to us and sufficient cash or liquidity is otherwise not available, the Company may not be able to make dividend payments to its shareholders, repurchase its shares, or make principal and interest payments on its outstanding debt. Our broker-dealersbroker-dealer and bank subsidiaries are limited in their ability to lend or transact with affiliates, are subject to minimum regulatory capital and other requirements, and, in the case of our broker-dealer subsidiaries, have limitations on their ability to use funds deposited with them in brokerage accounts to fund their businesses. These requirements and limitations may hinder our company’s ability to access funds from its subsidiaries. Federal regulators, including the Federal Reserve and the SEC (through FINRA), have the authority and, under certain circumstances, the obligation to limit or prohibit dividend payments and share repurchases by the banking organizations they supervise, including our company and its bank subsidiaries.

We plan to maintain our focus on revenue growth with a continued appreciation for the development of quality client relationships. Within our private client business, our efforts will be focused on recruiting experienced financial advisors with established client relationships. Within our capital markets business, our focus continues to be on providing quality client management and product diversification. In executing our growth strategy, we will continue to seek out opportunities that allow us to take advantage of the consolidation among middle-market firms,consolidation, whereby allowing us to increase market share in our private client and institutional group businesses.

Stifel Financial Corp., through its wholly owned subsidiaries, is principally engaged in retail brokerage; securities trading; investment banking; investment advisory; retail, consumer, and commercial banking; and related financial services. Our major geographic area of concentration is throughout the United States, the United Kingdom, Europe, and Canada, with a growing presence in Europe.Canada. Our principal customers are individual investors, corporations, municipalities, and institutions.

On JanuaryJune 6,2, 2025, the Company announced it signed a definitive agreement to acquireacquired Bryan, Garnier & Co. (“Bryan Garnier”), an independent full-service investment bank focused on European technology and healthcare companies. Bryan Garnier’s product suite includes mergers & acquisitions advisory, private and public growth financing solutions, and institutional sales and execution. Bryan Garnier is headquartered in Europe with offices in Paris, London, Amsterdam, Munich, Oslo, Stockholm, and New York. TheConsideration for this transaction is expected to close in the first halfconsisted of 2025.cash from operations.

For the year ended December 31, 2024,2025, net revenues increased 14.3%11.3% to a record $4.97$5.53 billion compared to $4.35$4.97 billion during the comparable period in 2023.2024. Net income available to common shareholders for the year ended December 31, 2024,2025, increaseddecreased 43.0%6.9% to $646.5 million, or $5.87 per diluted common share, compared to $694.1 million, or $6.25 per diluted common share, comparedin 2024. Net income available to $485.3 million, or $4.28 per diluted common share,shareholders in 2023. Forfor the year ended December 31, 2024,2025, ourwas Globalnegatively Wealthimpacted Managementby segmentelevated postedprovisions recordfor netlegal revenues.matters of $1.16 per diluted common share (after-tax) related to a FINRA Arbitration Panel decision in the first quarter.

Our revenue growth for the year ended December 31, 2024,2025, was primarily attributable to higher investment banking revenues, asset management revenues, and transactional revenues, partially offset by lowerand net interest income. For the year ended December 31, 2025, our Global Wealth Management segment posted record net revenues, with our Institutional Group segment posting its second highest net revenues.

We currently operate in a challenging and uncertain economic environment. Results in the businesses in which we operate are highly correlated to general economic conditions and, more specifically, to the direction of the U.S. equity and fixed income markets. Market volatility, overall market conditions, interest rates, economic, political, and regulatory trends, and industry competition are among the factors which could affect us and which are unpredictable and beyond our control. These factors affect the financial decisions made by market participants who include investors and competitors, impacting their level of participation in the financial markets. In addition, in periods of reduced financial market activity, profitability is likely to be adversely affected because certain expenses remain relatively fixed, including salaries and related costs, as well as portions of communications costs and occupancy expenses. Accordingly, earnings for any period should not be considered representative of earnings to be expected for any other period.

For the year ended December 31, 2024,2025, net revenues increased 14.3%11.3% to a record $4.97$5.53 billion from $4.35$4.97 billion in 2023.2024. The increase was primarily attributable to higher investment banking, asset management, and transactional revenues, partially offset by lowerand net interest income.

For the year ended December 31, 2024,2025, commission revenues increased 12.2%7.6% to $813.6 million from $756.0 million fromin $673.62024. millionThe increase is primarily attributable to higher volumes due to increased market volatility over the comparable period in 2023.2024.

Transactional revenues – For the year ended December 31, 2024,2025, transactionalprincipal transactions revenues increased 16.9%6.7% to $1.36$645.3 billionmillion from $1.16$604.6 billionmillion in 20232024. as a result of anThe increase inis primarily attributable to higher realized trading gains and increased client activity.activity over the comparable period in 2024.

For the year ended December 31, 2024,2025, investment banking revenues increased 36.0%25.7% to $1.3 billion from $994.8 million from $731.3 million in 2023.2024.

Capital-raising revenues increased 57.1% to $417.4 million for the year ended December 31, 2024, from $265.7 million in 2023. For the year ended December 31, 2024, equity2025, capital-raising revenues increased 73.2%26.7% to $198.5$528.7 million from $114.6$417.4 million in 2023 driven by higher volumes during 2024. For the year ended December 31, 2024,2025, equity capital-raising revenues increased 41.4% to $280.7 million from $198.5 million in 2024 driven by higher volumes during 2025. For the year ended December 31, 2025, fixed income capital-raising revenues increased 44.9%13.3% to $248.0 million from $218.9 million from $151.1 million in 20232024 driven by higher bond issuances reflecting a more favorable financing environment during 2024.2025.

Advisory revenues increased 24.0% to $577.4 million forFor the year ended December 31, 2024,2025, advisory revenues increased 25.0% to $722.0 million from $465.6$577.4 million in 2023.2024. The increase is primarily attributable to higher levels of completed advisory transactions during 2024.2025 with continued growth in depository advisory transactions.

For the year ended December 31, 2024,2025, asset management revenues increased 18.3%10.7% to a record $1.54$1.70 billion from $1.30$1.54 billion in 2023.2024. The increase is primarily attributable to market appreciation leading to higher asset values due to improved market conditions and net cashnew inflowsasset primarily as a result of our recruiting efforts.growth. Please refer to “Asset management” in the Global Wealth Management segment discussion for information on the changes in asset management revenues.

Other income – For the year ended December 31, 2023,2025, other income decreased 55.6%21.3% to $8.7$33.9 million from $19.7$43.1 million induring 2022.2024. The decrease is primarily attributable to lossesreduced onlease income generated from our aircraft engine leasing business due to the sale of investmentsengines, inlower theinvestment first quarter of 2023gains, and a decrease in mortgage loan origination fees.fees from the comparable period in 2024.

Net interest income – Net interest income is the difference between interest earned on interest-earning assets and interest paid on funding sources. Net interest income is affected by changes in the volume and mix of these assets and liabilities, as well as by fluctuations in interest rates and portfolio management strategies. For the year ended December 31, 2024,2025, net interest income decreasedincreased 9.6%4.9% to $1.0$1.09 billion from $1.1$1.04 billion in 2023.2024.

Results for the three and six months ended MarchJune 31,30, 2026

For the three months ended MarchJune 31,30, 2026, net revenues increased 17.7%13.0% to $1.5 billion from $1.3 billion during the comparable period in 2025. Net income available to common shareholders increased 454.4%49.0% to $242.1$217.2 million, or $1.48$1.34 per diluted common share for the three months ended MarchJune 31,30, 2026, compared to $43.7$145.7 million, or $0.26$0.89 per diluted common share during the comparable period in 2025. Net income available to common shareholders for the three months ended March 31, 2025 was negatively impacted by elevated provisions for legal matters.

Our revenue growth was primarily attributable to higher investment banking revenues, asset management revenues, transactionalcommission revenues, and net interest income, and the recognition of a gain on the sale of SIA during the quarter.income.

Three Months Ended MarchJune 31,30, 2026 Compared with Three Months Ended MarchJune 31,30, 2025

For the three months ended MarchJune 31,30, 2026, commission revenues increased 7.3%10.4% to $207.8$221.5 million from $193.7$200.7 million in the comparable period in 2025. For the six months ended June 30, 2026, commission revenues increased 8.9% to $429.3 million from $394.3 million in the comparable period in 2025. The increase is primarily attributable to higher volumes due to increased market volatility.volatility over the comparable periods in 2025.

For the three months ended MarchJune 31,30, 2026, investment banking revenues increased 43.5%42.2% to $341.4$332.0 million from $237.9$233.5 million in the comparable period in 2025.

Capital-raising revenues increased 22.4%64.3% to $123.0$174.5 million for the three months ended MarchJune 31,30, 2026 from $100.5$106.2 million in the comparable period in 2025. For the three months ended MarchJune 31,30, 2026, equity capital-raising revenues increased 35.9%120.1% to $70.2$107.2 million from $51.7$48.7 million in the comparable period in 2025 driven by higher volumes.volumes and larger deal sizes during the quarter. For the three months ended MarchJune 31,30, 2026, fixed income capital-raising revenues increased 8.1%17.1% to $52.8$67.3 million from $48.8$57.5 million in the comparable period in 2025 driven by higher bond issuances during the first quarter of 2026.quarter.

Advisory revenues increased 58.9%23.7% to $218.4$157.5 million for the three months ended MarchJune 31,30, 2026 from $137.5$127.3 million in the comparable period in 2025. The increase is primarily attributable to higher levels of completed advisory transactions.transactions during the quarter.

For the three months ended MarchJune 31,30, 2026, asset management revenues increased 12.2%13.1% to a record $459.5$456.6 million from $409.5$403.6 million in the comparable period in 2025. For the six months ended June 30, 2026, asset management revenues increased 12.7% to $916.1 million from $813.1 million in the comparable period in 2025. Please refer to “Asset management” in the Global Wealth Management segment discussion for information on the changes in asset management revenues.

Other income – Other income primarily includes investment gains and losses, rental income, and loan originations fees. For the three months ended MarchJune 31,30, 2026, other income increased 426.2%240.1% to $55.7$12.5 million from $10.6$3.7 million during the comparable period in 2025. The increase is primarily attributable to theincreases recognitionin ofinvestment agains gain onfrom the salecomparable ofperiod SIAin and higher loan origination fees during the quarter.2025.

The following tabletables presentspresent average balance data and operating interest revenue and expense data, as well as related interest yields for the periods indicated (in thousands, except rates):

The following table sets forth an analysis of the effect on net interest income of volume and rate changes for the three monthsand six month periods ended MarchJune 31,30, 2026 compared to the three monthsand six month periods ended MarchJune 31,30, 2025 (in thousands):

Net interest income – Net interest income is the difference between interest earned on interest-earning assets and interest paid on funding sources. Net interest income is affected by changes in the volume and mix of these assets and liabilities, as well as by fluctuations in interest rates and portfolio management strategies. For the three months ended MarchJune 31,30, 2026, net interest income increased 0.6%6.6% to $263.6$288.1 million from $262.1$270.3 million during the comparable period in 2025. For the six months ended June 30, 2026, net interest income increased 3.6% to $551.7 million from $532.3 million during the comparable period in 2025.

For the three months ended MarchJune 31,30, 2026, interest revenue decreased 5.2%0.2% to $451.0$476.1 million from $475.6$477.1 million in the comparable period in 2025, principally as a result of a decrease in interest rates, partially offset by higher interest-earning assets. The average interest-earning assets of Stifel Bancorp increased to $31.8$33.0 billion during the three months ended MarchJune 31,30, 2026 compared to $31.3$31.0 billion during the comparable period in 2025 at average interest rates of 5.14%5.24% and 5.58%,5.66%, respectively.

For the threesix months ended MarchJune 31,30, 2026, interest expenserevenue decreased 12.2%2.7% to $187.5$927.1 million from $213.6$952.7 million duringin the comparable period in 2025.2025, Theprincipally as a result of a decrease is primarily attributable to lowerin interest rates, partially offset by higher interest-bearinginterest-earning liabilities.assets. The average interest-bearinginterest-earning liabilitiesassets of Stifel Bancorp increased to $29.3$32.4 billion during the threesix months ended MarchJune 31,30, 2026 compared to $28.7$31.1 billion during the comparable period in 2025 at average interest rates of 2.09%5.19% and 2.71%,5.62%, respectively.

For the three months ended MarchJune 31,30, 2026, compensation and benefits expense increased 15.9%7.5% to $848.3$833.0 million from $732.2$774.9 million during the comparable period in 2025. For the six months ended June 30, 2026, compensation and benefits expense increased 11.6% to $1.7 billion from $1.5 billion during the comparable period in 2025. The increase in compensation and benefits expenses is primarily attributable to higher variable compensation costs.costs over the comparable periods in 2025.

Compensation and benefits expense as a percentage of net revenues was 57.4% forand the three months ended March 31, 2026, compared to 58.3%57.4% for the three and six months ended MarchJune 31,30, 2025.2026, respectively, compared to 60.3% and 59.3% for the three and six months ended June 30, 2025, respectively. The decrease is primarily attributable to to revenue growth, partially offset by higher revenue-related compensation over the comparable period in 2025.

Occupancy and equipment rental – For the three months ended MarchJune 31,30, 2026, occupancy and equipment rental expense increased 9.8%5.1% to $99.7$100.6 million from $90.8$95.7 million during the comparable period in 2025. For the six months ended June 30, 2026, occupancy and equipment rental expense increased 7.4% to $200.3 million from $186.4 million during the comparable period in 2025. The increase is primarily attributable to higher data processing expense and occupancyfurniture and equipment costs associated with an increase in business activity.activity over the comparable periods in 2025.

Communications and office supplies – Communications expense includes costs for telecommunication and data transmission, primarily for obtaining third-party market data information. For the three months ended MarchJune 31,30, 2026, communications and office supplies expense increaseddecreased 3.0%3.1% to $51.0$46.3 million from $49.5$47.8 million during the comparable period in 2025. The increasedecrease is primarily attributable to higherlower communication and quote equipment expenses, office supplies expenses, and telecommunication expenses, partially offset by higher postage and shipping expenses associatedover the comparable period in 2025. For the six months ended June 30, 2026, communications and office supplies expense of $97.4 million was consistent with the continuedcomparable growthperiod ofin our business.2025.

Commissions and floor brokerage – For the three months ended MarchJune 31,30, 2026, commissions and floor brokerage expense decreased 10.5%12.3% to $15.0 million from $16.8$17.1 million during the comparable period in 2025. For the six months ended June 30, 2026, commissions and floor brokerage expense decreased 11.4% to $30.1 million from $34.0 million during the comparable period in 2025. The decrease is primarily attributable to lower clearing expensesexpenses, electronic communication network (“ECN”) trading costs, processing expenses, and processingtransaction expenses.fees.

Provision for credit losses – For the three months ended MarchJune 31,30, 2026, provision for credit losses increased 50.6% to $12.5 million from $8.3 million during the comparable period in 2025. The increase is primarily attributable to overall loan growth in the retained portfolio and specific reserves on individual credits. For the six months ended June 30, 2026, provision for credit losses decreased 45.6%6.3% to $6.5$19.1 million from $12.0$20.3 million during the comparable period in 2025. The decrease is primarily attributable to modest improvement in macroeconomic conditions, partially offset by loan growth in the retained portfolio and specific reserves on individual credits.

For the three months ended MarchJune 31,30, 2026, other operating expenses decreasedincreased 54.8%13.7% to $131.5$143.9 million from $290.8$126.5 million during the comparable period in 2025. The decreaseincrease is primarily attributable to decreaseshigher intravel-related legal-relatedexpenses, expensesinvestment andbanking duesexpenses, and assessments during the quarter, partially offset by higheradvertising, amortization of identifiable intangible assets, professional fees, bank service charges, advertising,insurance travelexpenses, and subscriptions, partially offset by lower legal-related expenses, conference-related expenses, professional fees, and subscriptions.licensing During the first quarter of 2025, we recorded $180.0 million related to provisions for legal-related matters.fees.

Provision for income taxes – For the three and six months ended MarchJune 31,30, 2026, our provision for income taxes was $74.7$73.0 million and $147.6 million, representing an effective tax rate of 22.9%,24.4% and 23.6%, respectively, compared to $10.4$58.8 million and $69.1 million for the comparable periodperiods in 2025, representing an effective tax rate of 16.4%.27.5% Theand tax24.9%, rate was primarily impacted by the excess tax benefit related to stock-based compensation.respectively.

Three Months Ended MarchJune 31,30, 2026 Compared with Three Months Ended MarchJune 31,30, 2025

For the three months ended MarchJune 31,30, 2026, Global Wealth Management net revenues increased 9.6%13.1% to $932.1a record $956.5 million from $850.6$845.6 million for the comparable period in 2025. For the six months ended June 30, 2026, Global Wealth Management net revenues increased 11.3% to a record $1.9 billion from $1.7 billion for the comparable period in 2025. The increase in net revenues over the comparable periodperiods in 2025 is primarily attributable to higher asset management revenues, transactional revenues, net interest income, and transactionalinvestment banking revenues.

Commissions – For the three months ended MarchJune 31,30, 2026, commission revenues increased 11.3%14.8% to $140.1$147.2 million from $125.8$128.2 million in the comparable period in 2025. For the six months ended June 30, 2026, commission revenues increased 13.1% to $287.2 million from $254.0 million in the comparable period in 2025. The increase is primarily attributable to higher volumes due to increased market volatility over the comparable periodperiods in 2025.

Principal transactions – For the three months ended MarchJune 31,30, 2026, principal transactions revenues increased 3.3%10.6% to $62.6$60.2 million from $60.6$54.5 million in the comparable period in 2025. For the six months ended June 30, 2026, principal transactions revenues increased 6.8% to $122.8 million from $115.0 million in the comparable period in 2025. The increase is primarily attributable to an increase in client activity.activity and higher realized trading gains over the comparable periods in 2025.

Asset management – For the three months ended MarchJune 31,30, 2026, asset management revenues increased 12.2%13.1% to $459.4$456.6 million from $409.5$403.6 million in the comparable period in 2025. For the six months ended June 30, 2026, asset management revenues increased 12.7% to $916.0 million from $813.1 million in the comparable period in 2025. The increase is primarily attributable to higher asset values and net new asset growth. Fee-based account revenues are primarily billed based on asset values at the end of the prior quarter.

(1) Total client assets as of MarchJune 31, 2025 and December 31,30, 2025, include $9.0 billion and $10.5$9.7 billion, respectively, and fee-based client assets include $4.2 billion and $4.9$4.6 billion, respectively, of client assets from the SIA business that was sold on February 2, 2026.

The increase in the value of our client assets and fee-based assets was primarily attributable to improved market conditions and asset growth resulting from our recruiting efforts, partially offset by the sale of the SIA business during the quarter.first quarter of 2026.

Investment banking – Investment banking, which represents sales credits for investment banking underwritings, increased 2.8%39.7% to $6.1$8.7 million for the three months ended MarchJune 31,30, 2026 from $5.9$6.2 million during the comparable period in 2025. For the six months ended June 30, 2026, investment banking revenues increased 21.7% to $14.8 million from $12.1 million during the comparable period in 2025. Please refer to “Investment banking” in the Institutional Group segment discussion for information on the changes in net revenues.

Interest revenue – For the three months ended MarchJune 31,30, 2026, interest revenue decreased 4.9%0.7% to $429.2$453.0 million from $451.5$456.4 million in the comparable period in 2025. For the six months ended June 30, 2026, interest revenue decreased 2.8% to $882.2 million from $907.9 million during the comparable period in 2025. The decrease is primarily attributable to lower interest rates, partially offset by higher interest-earning assets.

Other income – For the three months ended MarchJune 31,30, 2026, other income decreased 112.5%increased to $9.2 million from a loss of $0.4 million from $3.2$1.0 million in the comparable period in 2025. The decreaseincrease is primarily attributable to higher investment lossesgains duringand thean quarter,increase partially offset by higherin loan origination fees. For the six months ended June 30, 2026, other income increased 295.7% to $8.8 million from $2.2 million during the comparable period in 2025. The increase is primarily attributable to lower investment losses and an increase in loan origination fees.

Interest expense – For the three months ended MarchJune 31,30, 2026, interest expense decreased 20.0%11.8% to $164.9$178.4 million from $206.0$202.3 million in the comparable period in 2025. For the six months ended June 30, 2026, interest expense decreased 15.9% to $343.3 million from $408.2 million during the comparable period in 2025. The decrease is primarily attributable to lower interest rates, partially offset by higher interest-bearing liabilities.

For the three months ended MarchJune 31,30, 2026, Global Wealth Management non-interest expenses increased 10.2% to $594.7 million from $539.6 million for the comparable period in 2025. For the six months ended June 30, 2026, Global Wealth Management non-interest expenses decreased 17.0%5.4% to $601.4$1.2 millionbillion from $724.2$1.3 millionbillion for the comparable period in 2025.

CommissionsCompensation and floor brokeragebenefits – For the three months ended MarchJune 31,30, 2026, commissionscompensation and floor brokeragebenefits expense increased 2.4%9.6% to $7.4$460.6 million from $7.2$420.2 million during the comparable period in 2025. For the six months ended June 30, 2026, compensation and benefits expense increased 10.7% to $933.0 million from $842.5 million during the comparable period in 2025. The increase is primarily attributable to higherincreased clearingvariable expenses.compensation over the comparable periods in 2025.

ProvisionCommissions forand creditfloor lossesbrokerage – For the three months ended MarchJune 31,30, 2026, provisioncommissions forand creditfloor lossesbrokerage decreasedexpense 45.6%increased 8.4% to $6.5$7.9 million from $12.0$7.3 million during the comparable period in 2025. For the six months ended June 30, 2026, commissions and floor brokerage expense increased 5.5% to $15.3 million from $14.5 million during the comparable period in 2025. The decreaseincrease is primarily attributable to ahigher modestclearing improvementexpenses, processing fees, and transaction fees over the comparable periods in macroeconomic conditions, partially offset by loan growth in the retained portfolio and specific reserves on individual credits.2025.

Other operating expenses – For the three months ended MarchJune 31,30, 2026, other operating expenses decreasedincreased 77.9%16.4% to $49.0$48.5 million from $221.7$41.7 million during the comparable period in 2025. The decreaseincrease is primarily attributable to lowerhigher legal-related expenses and dues and assessments, partially offset by higherexpenses, travel-related expenses, bank service charges, insurance expenses,expense, and subscription costs, partially offset by decreases in conference-related expenses, professional fees, advertising, and conference-related expenses. During the first quarter of 2025, we recorded $180.0 million related to provisions for legal-related matters.advertising.