# EDGAR Filing Document

**Accession Number:** 0001501570
**File Stem:** 0001501570-25-000140
**Filing Date:** 2025-8
**Character Count:** 243089
**Document Hash:** 5309885385503c6d8f9764f6d0799593
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001501570-25-000140.hdr.sgml**: 20250801

**ACCESSION NUMBER**: 0001501570-25-000140

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 85

**CONFORMED PERIOD OF REPORT**: 20250630

**FILED AS OF DATE**: 20250801

**DATE AS OF CHANGE**: 20250801

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Veritex Holdings, Inc.
- **CENTRAL INDEX KEY:** 0001501570
- **STANDARD INDUSTRIAL CLASSIFICATION:** STATE COMMERCIAL BANKS [6022]
- **ORGANIZATION NAME:** 02 Finance
- **EIN:** 270973566
- **STATE OF INCORPORATION:** TX
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-36682
- **FILM NUMBER:** 251176934

**BUSINESS ADDRESS:**
- **STREET 1:** 8214 WESTCHESTER DRIVE
- **STREET 2:** SUITE 800
- **CITY:** DALLAS
- **STATE:** TX
- **ZIP:** 75225
- **BUSINESS PHONE:** 972-349-6200

**MAIL ADDRESS:**
- **STREET 1:** 8214 WESTCHESTER DRIVE
- **STREET 2:** SUITE 800
- **CITY:** DALLAS
- **STATE:** TX
- **ZIP:** 75225

?xml version='1.0' encoding='ASCII'? vbtx-20250630

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

---

| | |
|:---|:---|
| **FORM** | **10-Q** |

---

☒ **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the quarterly period ended June 30, 2025**

**or**

☐ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the transition period from** <u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u> **to** <u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>.

**Commission File Number: 001-36682** 

---

| |
|:---|
| **VERITEX HOLDINGS, INC.** |
| (Exact name of registrant as specified in its charter) |

---

---

| | | |
|:---|:---|:---|
| **Texas** | **Texas** | **27-0973566** |
| (State or other jurisdiction of | (State or other jurisdiction of | (I.R.S. employer |
| incorporation or organization) | incorporation or organization) | identification no.) |
| **8214 Westchester Drive, Suite 800** | **8214 Westchester Drive, Suite 800** | |
| **Dallas,** | **Texas** | **75225** |
| (Address of principal executive offices) | (Address of principal executive offices) | (Zip code) |

---

---

| | |
|:---|:---|
| **(972)** | **349-6200** |
| (Registrant's telephone number, including area code) | (Registrant's telephone number, including area code) |

---

Securities registered pursuant to Section 12(b) of the Act:

---

| | | |
|:---|:---|:---|
| Title of each class | Trading Symbol | Name of each exchange on which registered |
| Common Stock, par value $0.01 | VBTX | Nasdaq Global Market |

---

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):

---

| | | | | |
|:---|:---|:---|:---|:---|
| | Large accelerated filer | ☒ | Accelerated filer | ☐ |
| | Non-accelerated filer | ☐ | Smaller reporting company | ☐ |
| | | | Emerging growth company | ☐ |
| If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ | If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ | If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ | If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ | If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ |

---

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 30, 2025, there were 54,745,471 outstanding shares of the registrant's common stock, par value $0.01 per share.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**VERITEX HOLDINGS, INC. AND SUBSIDIARIES**

---

| | | |
|:---|:---|:---|
| | | **Page** |
| **<u>[PART I — FINANCIAL INFORMATION](#i99d8b0fb842e4018a10d7d1e55bdf145_16)</u>** | **<u>[PART I — FINANCIAL INFORMATION](#i99d8b0fb842e4018a10d7d1e55bdf145_16)</u>** | **<u>[PART I — FINANCIAL INFORMATION](#i99d8b0fb842e4018a10d7d1e55bdf145_16)</u>** |
| <u>[Glossary of Acronyms, Abbreviations, and Terms](#i99d8b0fb842e4018a10d7d1e55bdf145_13)</u> | <u>[Glossary of Acronyms, Abbreviations, and Terms](#i99d8b0fb842e4018a10d7d1e55bdf145_13)</u> | <u>[3](#i99d8b0fb842e4018a10d7d1e55bdf145_13)</u> |
| <u>[Item 1.](#i99d8b0fb842e4018a10d7d1e55bdf145_19)</u> | <u>[Financial Statements – Unaudited](#i99d8b0fb842e4018a10d7d1e55bdf145_19)</u> | <u>[4](#i99d8b0fb842e4018a10d7d1e55bdf145_19)</u> |
|  | &nbsp;&nbsp;&nbsp;&nbsp;<u>[Consolidated Balance Sheets](#i99d8b0fb842e4018a10d7d1e55bdf145_1732)</u> | <u>[4](#i99d8b0fb842e4018a10d7d1e55bdf145_1732)</u> |
|  | &nbsp;&nbsp;&nbsp;&nbsp;<u>[Consolidated Statements of Income](#i99d8b0fb842e4018a10d7d1e55bdf145_28)</u> | <u>[5](#i99d8b0fb842e4018a10d7d1e55bdf145_28)</u> |
|  | &nbsp;&nbsp;&nbsp;&nbsp;<u>[Consolidated Statements of Comprehensive Income](#i99d8b0fb842e4018a10d7d1e55bdf145_31)</u> | <u>[6](#i99d8b0fb842e4018a10d7d1e55bdf145_31)</u> |
|  | &nbsp;&nbsp;&nbsp;&nbsp;<u>[Consolidated Statements of Changes in Stockholders' Equity](#i99d8b0fb842e4018a10d7d1e55bdf145_34)</u> | <u>[7](#i99d8b0fb842e4018a10d7d1e55bdf145_34)</u> |
|  | &nbsp;&nbsp;&nbsp;&nbsp;<u>[Consolidated Statements of Cash Flows](#i99d8b0fb842e4018a10d7d1e55bdf145_43)</u> | <u>[9](#i99d8b0fb842e4018a10d7d1e55bdf145_43)</u> |
|  | &nbsp;&nbsp;&nbsp;&nbsp;<u>[Notes to Consolidated Financial Statements](#i99d8b0fb842e4018a10d7d1e55bdf145_46)</u> | <u>[10](#i99d8b0fb842e4018a10d7d1e55bdf145_46)</u> |
| <u>[Item 2.](#i99d8b0fb842e4018a10d7d1e55bdf145_130)</u> | <u>[Management's Discussion and Analysis of Financial Condition and Results of Operations](#i99d8b0fb842e4018a10d7d1e55bdf145_130)</u> | <u>[40](#i99d8b0fb842e4018a10d7d1e55bdf145_130)</u> |
| <u>[Item 3.](#i99d8b0fb842e4018a10d7d1e55bdf145_154)</u> | <u>[Quantitative and Qualitative Disclosures about Market Risk](#i99d8b0fb842e4018a10d7d1e55bdf145_154)</u> | <u>[64](#i99d8b0fb842e4018a10d7d1e55bdf145_154)</u> |
| <u>[Item 4.](#i99d8b0fb842e4018a10d7d1e55bdf145_157)</u> | <u>[Controls and Procedures](#i99d8b0fb842e4018a10d7d1e55bdf145_157)</u> | <u>[65](#i99d8b0fb842e4018a10d7d1e55bdf145_157)</u> |
| **<u>[PART II — OTHER INFORMATION](#i99d8b0fb842e4018a10d7d1e55bdf145_160)</u>** | **<u>[PART II — OTHER INFORMATION](#i99d8b0fb842e4018a10d7d1e55bdf145_160)</u>** | **<u>[PART II — OTHER INFORMATION](#i99d8b0fb842e4018a10d7d1e55bdf145_160)</u>** |
| <u>[Item 1.](#i99d8b0fb842e4018a10d7d1e55bdf145_163)</u> | <u>[Legal Proceedings](#i99d8b0fb842e4018a10d7d1e55bdf145_163)</u> | <u>[66](#i99d8b0fb842e4018a10d7d1e55bdf145_163)</u> |
| <u>[Item 1A.](#i99d8b0fb842e4018a10d7d1e55bdf145_166)</u> | <u>[Risk Factors](#i99d8b0fb842e4018a10d7d1e55bdf145_166)</u> | <u>[66](#i99d8b0fb842e4018a10d7d1e55bdf145_166)</u> |
| <u>[Item 2.](#i99d8b0fb842e4018a10d7d1e55bdf145_169)</u> | <u>[Unregistered Sales of Equity Securities and Use of Proceeds](#i99d8b0fb842e4018a10d7d1e55bdf145_169)</u> | <u>[68](#i99d8b0fb842e4018a10d7d1e55bdf145_169)</u> |
| <u>[Item 6.](#i99d8b0fb842e4018a10d7d1e55bdf145_175)</u> | <u>[Exhibits](#i99d8b0fb842e4018a10d7d1e55bdf145_175)</u> | <u>[69](#i99d8b0fb842e4018a10d7d1e55bdf145_175)</u> |
| **<u>[SIGNATURES](#i99d8b0fb842e4018a10d7d1e55bdf145_178)</u>** | **<u>[SIGNATURES](#i99d8b0fb842e4018a10d7d1e55bdf145_178)</u>** | <u>[70](#i99d8b0fb842e4018a10d7d1e55bdf145_178)</u> |

---

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**Glossary of Acronyms, Abbreviations, and Terms**

The acronyms, abbreviations, and terms listed below are used in various sections of this Quarterly Report on Form 10-Q, including "Part I, Item 1. Financial Statements" and "Part I, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations."

---

| | | | |
|:---|:---|:---|:---|
| ACL | Allowance for Credit Loss | GAAP | Generally Accepted Accounting Principles in the United States of America |
| AFS | Available-For-Sale | HTM | Held-To-Maturity |
| AOCI | Accumulated Other Comprehensive Income | LHFS | Loans Held for Sale |
| APIC | Additional Paid-In Capital | LHI | Loans Held for Investment |
| ASC | Accounting Standards Codification | MBS | Mortgage-backed Securities |
| BOLI | Bank-Owned Life Insurance | MW | Mortgage Warehouse |
| Board | Board of Directors of Veritex Holdings, Inc. | NOOCRE | Non-owner Occupied CRE |
| bps | Basis Points | OBS | Off-Balance Sheet |
| CET1 | Common Equity Tier 1 | OOCRE | Owner Occupied CRE |
| CMO | Collateralized Mortgage Obligation | OREO | Other Real Estate Owned |
| CODM | Chief Operating Decision Maker | PCA | Prompt Corrective Action |
| CRA | Community Reinvestment Act | PCD | Purchased Credit Deteriorated |
| CRE | Commercial Real Estate | RBC | Risk-Based Capital |
| DFW | Dallas-Fort Worth | RSU | Restricted stock units |
| EPS | Earnings Per Share | RWA | Risk-Weighted Assets |
| Exchange Act | Securities Exchange Act of 1934, as amended | SBA | U. S. Small Business Administration |
| FDIC | Federal Deposit Insurance Corporation | SEC | Securities and Exchange Commission |
| Federal Reserve | The Federal Reserve System | TDB | Texas Department of Banking |
| FHLB | Federal Home Loan Bank | USDA | United States Department of Agriculture |
| FRB | Federal Reserve Bank of Dallas |  |  |

---

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**PART I. FINANCIAL INFORMATION** 

**Item 1. Financial Statements**

**VERITEX HOLDINGS, INC. AND SUBSIDIARIES**

**Consolidated Balance Sheets**

---

| | | |
|:---|:---|:---|
| | **June 30,**<br>**2025** | **December 31,**<br>**2024** |
| *(Dollars in thousands, except par value and share information)* | (Unaudited) |  |
| **ASSETS** |  |  |
| Cash and due from banks | $66696 | $52486 |
| Interest bearing deposits in other banks | 703869 | 802714 |
| &nbsp;&nbsp;&nbsp;Total cash and cash equivalents | 770565 | 855200 |
| Debt securities AFS, at fair value | 1242285 | 1294512 |
| Debt securities HTM (fair value of $152,319 and $160,560, at June 30, 2025 and December 31, 2024, respectively) | 176519 | 184026 |
| Equity securities | 20492 | 22053 |
| Investment in unconsolidated subsidiaries | 1018 | 1018 |
| FHLB Stock and FRB Stock | 52476 | 46567 |
| &nbsp;&nbsp;&nbsp;Total investments | 1492790 | 1548176 |
| LHFS | 69480 | 89309 |
| LHI, MW | 669052 | 605411 |
| LHI, excluding MW | 8783988 | 8899133 |
| Less: ACL | (112262) | (111745) |
| &nbsp;&nbsp;Total LHI, net | 9340778 | 9392799 |
| BOLI | 86048 | 85324 |
| Premises and equipment, net | 116642 | 113480 |
| OREO | 9218 | 24737 |
| Intangible assets, net of accumulated amortization | 25006 | 28664 |
| Goodwill | 404452 | 404452 |
| Other assets | 212889 | 226200 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total assets** | $12527868 | $12768341 |
| **LIABILITIES AND STOCKHOLDERS' EQUITY** |  |  |
| Deposits: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Noninterest-bearing deposits | $2133294 | $2191457 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing transaction and savings deposits | 5009137 | 5061157 |
| &nbsp;&nbsp;&nbsp;&nbsp;Certificates and other time deposits | 2792750 | 2958861 |
| &nbsp;&nbsp;&nbsp;&nbsp;Correspondent money market deposits | 482739 | 541117 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total deposits** | 10417920 | 10752592 |
| Accounts payable and other liabilities | 135647 | 183944 |
| Advances from FHLB | 169000 |  |
| Subordinated debentures and subordinated notes | 156082 | 230736 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total liabilities** | 10878649 | 11167272 |
| Stockholders' equity: |  |  |
| &nbsp;&nbsp;Common stock, $0.01 par value: |  |  |
| &nbsp;&nbsp;&nbsp;Authorized shares - 75,000,000 |  |  |
| &nbsp;&nbsp;&nbsp;Issued shares - 61,744,795 and 61,332,445 at June 30, 2025 and December 31, 2024, respectively | 617 | 613 |
| &nbsp;&nbsp;APIC | 1329803 | 1328748 |
| &nbsp;&nbsp;Retained earnings | 545015 | 507903 |
| AOCI | (38528) | (65076) |
| &nbsp;&nbsp;Treasury stock, 7,479,401 and 6,815,764 shares, at cost, at June 30, 2025 and December 31, 2024, respectively | (187688) | (171119) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total stockholders' equity** | 1649219 | 1601069 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total liabilities and stockholders' equity** | $12527868 | $12768341 |

---

See accompanying Notes to Consolidated Financial Statements.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**VERITEX HOLDINGS, INC. AND SUBSIDIARIES**

**Consolidated Statements of Income (Unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended<br>June 30,** | **Three Months Ended<br>June 30,** | **Six Months Ended<br>June 30,** | **Six Months Ended<br>June 30,** |
| *(Dollars in thousands, except per share amounts)* | **2025** | **2024** | **2025** | **2024** |
| **INTEREST AND DIVIDEND INCOME** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest and fees on loans | $149354 | $166979 | $295859 | $328921 |
| &nbsp;&nbsp;&nbsp;&nbsp;Debt securities | 16883 | 15408 | 33989 | 29103 |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits in financial institutions and federal funds sold | 8039 | 7722 | 17283 | 15772 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equity securities and other investments | 847 | 1138 | 1717 | 2038 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total interest and dividend income** | 175123 | 191247 | 348848 | 375834 |
| **INTEREST EXPENSE** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Transaction and savings deposits | 48080 | 45619 | 93245 | 92403 |
| &nbsp;&nbsp;&nbsp;&nbsp;Certificates and other time deposits | 28539 | 44811 | 58807 | 85303 |
| &nbsp;&nbsp;&nbsp;&nbsp;Advances from FHLB | 113 | 1468 | 140 | 2859 |
| &nbsp;&nbsp;&nbsp;&nbsp;Subordinated debentures and subordinated notes | 2056 | 3113 | 4880 | 6227 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total interest expense** | 78788 | 95011 | 157072 | 186792 |
| **NET INTEREST INCOME** | 96335 | 96236 | 191776 | 189042 |
| Provision for credit losses on loans | 1750 | 8250 | 5750 | 15750 |
| Provision (benefit) for credit losses on unfunded commitments | 1500 |  | 2800 | (1541) |
| **Net interest income after provision (benefit) for credit losses** | 93085 | 87986 | 183226 | 174833 |
| **NONINTEREST INCOME** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Service charges and fees on deposit accounts | 5702 | 4974 | 11313 | 9870 |
| &nbsp;&nbsp;&nbsp;&nbsp;Loan fees | 2735 | 2207 | 5230 | 4717 |
| &nbsp;&nbsp;&nbsp;&nbsp;Loss on sales of debt securities |  |  |  | (6304) |
| &nbsp;&nbsp;&nbsp;&nbsp;Government guaranteed loan income, net | 1688 | 1320 | 4989 | 3934 |
| &nbsp;&nbsp;&nbsp;&nbsp;Customer swap income | 1550 | 326 | 2250 | 775 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other | 1824 | 1751 | 4006 | 4248 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total noninterest income** | 13499 | 10578 | 27788 | 17240 |
| **NONINTEREST EXPENSE** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Salaries and employee benefits | 34957 | 32790 | 71581 | 66155 |
| &nbsp;&nbsp;&nbsp;&nbsp;Occupancy and equipment | 4511 | 4585 | 9161 | 9262 |
| &nbsp;&nbsp;&nbsp;&nbsp;Professional and regulatory fees | 5558 | 5617 | 10489 | 11670 |
| &nbsp;&nbsp;&nbsp;&nbsp;Data processing and software expense | 5507 | 5097 | 10910 | 9953 |
| &nbsp;&nbsp;&nbsp;&nbsp;Marketing | 2612 | 1976 | 4644 | 3522 |
| &nbsp;&nbsp;&nbsp;&nbsp;Amortization of intangibles | 2438 | 2438 | 4876 | 4876 |
| &nbsp;&nbsp;&nbsp;&nbsp;Telephone and communications | 233 | 365 | 563 | 626 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other | 11346 | 10273 | 21772 | 19193 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total noninterest expense** | 67162 | 63141 | 133996 | 125257 |
| **Income before income tax expense** | 39422 | 35423 | 77018 | 66816 |
| &nbsp;&nbsp;&nbsp;&nbsp;Provision for income taxes | 8516 | 8221 | 17042 | 15458 |
| **NET INCOME** | $30906 | $27202 | $59976 | $51358 |
| Basic EPS | $0.57 | $0.50 | $1.10 | $0.94 |
| Diluted EPS | $0.56 | $0.50 | $1.09 | $0.94 |

---

See accompanying Notes to Consolidated Financial Statements.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**VERITEX HOLDINGS, INC. AND SUBSIDIARIES**

**Consolidated Statements of Comprehensive Income (Unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended<br>June 30,** | **Three Months Ended<br>June 30,** | **Six Months Ended<br>June 30,** | **Six Months Ended<br>June 30,** |
| *(Dollars in thousands)* | **2025** | **2024** | **2025** | **2024** |
| **NET INCOME** | $30906 | $27202 | $59976 | $51358 |
| **OTHER COMPREHENSIVE INCOME** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Net unrealized (losses) gains on debt securities AFS: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in net unrealized (losses) gains on debt securities AFS during the period, net | (1733) | (4599) | 20758 | (15020) |
| &nbsp;&nbsp;&nbsp;&nbsp;Change in unamortized gains from transfer of debt securities from AFS to HTM | (222) | (163) | (434) | 2762 |
| &nbsp;&nbsp;&nbsp;&nbsp;Reclassification adjustment for net losses included in net income |  |  |  | 6304 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net unrealized (losses) gains on debt securities AFS | (1955) | (4762) | 20324 | (5954) |
| &nbsp;&nbsp;Unrealized gains (losses) on derivative financial instruments: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net unrealized gains (losses) arising during the period | 3493 | (3116) | 9673 | (12447) |
| &nbsp;&nbsp;&nbsp;&nbsp;Reclassification adjustment for amortization in net income | 3072 | 888 | 3608 | 1724 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net unrealized gains (losses) on derivative instruments | 6565 | (2228) | 13281 | (10723) |
| Other comprehensive income (loss), before tax | 4610 | (6990) | 33605 | (16677) |
| &nbsp;&nbsp;&nbsp;&nbsp;Income tax expense (benefit) | 968 | (1434) | 7057 | (3427) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other comprehensive income (loss), net of tax | 3642 | (5556) | 26548 | (13250) |
| **COMPREHENSIVE INCOME** | $34548 | $21646 | $86524 | $38108 |

---

See accompanying Notes to Consolidated Financial Statements.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**VERITEX HOLDINGS, INC. AND SUBSIDIARIES**

**Consolidated Statements of Changes in Stockholders' Equity (Unaudited)** 

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** |
| | **Common Stock** | **Common Stock** | **Treasury Stock** | **Treasury Stock** | **APIC** | **Retained<br>Earnings** | **AOCI** | **Total** |
| *(Dollars in thousands, except share data)* | **Shares** | **Amount** | **Shares** | **Amount** | **APIC** | **Retained<br>Earnings** | **AOCI** | **Total** |
| **Balance at March 31, 2025** | 54296959 | $615 | 7193110 | $(180635) | $1329626 | $526044 | $(42170) | $1633480 |
| &nbsp;&nbsp;RSUs vested, net of 95,278 shares withheld to cover taxes | 246202 | 2 |  |  | (2358) |  |  | (2356) |
| &nbsp;&nbsp;&nbsp;Exercise of employee stock options | 8524 |  |  |  | 154 |  |  | 154 |
| &nbsp;&nbsp;&nbsp;Stock buyback | (286291) |  | 286291 | (7053) |  |  |  | (7053) |
| &nbsp;&nbsp;&nbsp;Stock based compensation |  |  |  |  | 2381 |  |  | 2381 |
| &nbsp;&nbsp;&nbsp;Net income |  |  |  |  |  | 30906 |  | 30906 |
| &nbsp;&nbsp;&nbsp;Dividends paid |  |  |  |  |  | (11935) |  | (11935) |
| &nbsp;&nbsp;&nbsp;Other comprehensive income, net of tax |  |  |  |  |  |  | 3642 | 3642 |
| **Balance at June 30, 2025** | 54265394 | $617 | 7479401 | $(187688) | $1329803 | $545015 | $(38528) | $1649219 |

---

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** |
| | **Common Stock** | **Common Stock** | **Treasury Stock** | **Treasury Stock** | **APIC** | **Retained<br>Earnings** | **AOCI** | |
| *(Dollars in thousands, except share data)* | **Shares** | **Amount** | **Shares** | **Amount** | **APIC** | **Retained<br>Earnings** | **AOCI** | **Total** |
| **Balance at March 31, 2024** | 54495961 | $611 | 6638094 | $(167582) | $1319144 | $457499 | $(71157) | $1538515 |
| &nbsp;&nbsp;RSUs vested, net of 15,679 shares withheld to cover taxes | 30077 | 1 |  |  | (316) |  |  | (315) |
| &nbsp;&nbsp;&nbsp;Stock buyback | (175688) |  | 175688 | (3497) |  |  |  | (3497) |
| &nbsp;&nbsp;&nbsp;Stock based compensation |  |  |  |  | 3167 |  |  | 3167 |
| &nbsp;&nbsp;&nbsp;Net income |  |  |  |  |  | 27202 |  | 27202 |
| &nbsp;&nbsp;&nbsp;Dividends paid |  |  |  |  |  | (10900) |  | (10900) |
| &nbsp;&nbsp;&nbsp;Other comprehensive loss, net of tax |  |  |  |  |  |  | (5556) | (5556) |
| **Balance at June 30, 2024** | 54350350 | $612 | 6813782 | $(171079) | $1321995 | $473801 | $(76713) | $1548616 |

---

See accompanying Notes to Consolidated Financial Statements.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**VERITEX HOLDINGS, INC. AND SUBSIDIARIES**

**Consolidated Statements of Changes in Stockholders' Equity (Unaudited)** 

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** |
| | **Common Stock** | **Common Stock** | **Treasury Stock** | **Treasury Stock** | **APIC** | **Retained<br>Earnings** | **AOCI** | |
| *(Dollars in thousands, except share data)* | **Shares** | **Amount** | **Shares** | **Amount** | **APIC** | **Retained<br>Earnings** | **AOCI** | **Total** |
| **Balance at December 31, 2024** | 54516681 | $613 | 6815764 | $(171119) | $1328748 | $507903 | $(65076) | $1601069 |
| &nbsp;&nbsp;RSUs vested, net of 165,922 shares withheld to cover taxes | 403255 | 4 |  |  | (4229) |  |  | (4225) |
| &nbsp;&nbsp;&nbsp;Exercise of employee stock options | 9095 |  |  |  | 166 |  |  | 166 |
| &nbsp;&nbsp;&nbsp;Stock buyback | (663637) |  | 663637 | (16569) |  |  |  | (16569) |
| &nbsp;&nbsp;&nbsp;Stock based compensation |  |  |  |  | 5118 |  |  | 5118 |
| &nbsp;&nbsp;&nbsp;Net income |  |  |  |  |  | 59976 |  | 59976 |
| &nbsp;&nbsp;&nbsp;Dividends paid |  |  |  |  |  | (22864) |  | (22864) |
| &nbsp;&nbsp;&nbsp;Other comprehensive income, net of tax |  |  |  |  |  |  | 26548 | 26548 |
| **Balance at June 30, 2025** | 54265394 | $617 | 7479401 | $(187688) | $1329803 | $545015 | $(38528) | $1649219 |

---

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** |
| | **Common Stock** | **Common Stock** | **Treasury Stock** | **Treasury Stock** | **APIC** | **Retained<br>Earnings** | **AOCI** | |
| *(Dollars in thousands, except share data)* | **Shares** | **Amount** | **Shares** | **Amount** | **APIC** | **Retained<br>Earnings** | **AOCI** | **Total** |
| **Balance at December 31, 2023** | 54338368 | $610 | 6638094 | $(167582) | $1317516 | $444242 | $(63463) | $1531323 |
| &nbsp;&nbsp;RSUs vested, net of 84,713 shares withheld to cover taxes | 187670 | 2 |  |  | (1577) |  |  | (1575) |
| &nbsp;&nbsp;&nbsp;Stock buyback | (175688) |  | 175688 | (3497) |  |  |  | (3497) |
| &nbsp;&nbsp;&nbsp;Stock based compensation |  |  |  |  | 6056 |  |  | 6056 |
| &nbsp;&nbsp;&nbsp;Net income |  |  |  |  |  | 51358 |  | 51358 |
| &nbsp;&nbsp;&nbsp;Dividends paid |  |  |  |  |  | (21799) |  | (21799) |
| &nbsp;&nbsp;&nbsp;Other comprehensive loss, net of tax |  |  |  |  |  |  | (13250) | (13250) |
| **Balance at June 30, 2024** | 54350350 | $612 | 6813782 | $(171079) | $1321995 | $473801 | $(76713) | $1548616 |

---

See accompanying Notes to Consolidated Financial Statements.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**VERITEX HOLDINGS, INC. AND SUBSIDIARIES**

**Consolidated Statements of Cash Flows (Unaudited)**

---

| | | |
|:---|:---|:---|
| | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
| *(Dollars in thousands)* | **2025** | **2024** |
| **Cash flows from operating activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net income | $59976 | $51358 |
| &nbsp;&nbsp;&nbsp;&nbsp;Adjustments to reconcile net income to net cash provided by operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization of fixed assets and intangibles | 9347 | 9525 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net accretion of time deposit premium, debt discount and debt issuance costs | (1829) | (1685) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision for credit losses on loans and unfunded commitments | 8550 | 14209 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accretion of loan discount | (1171) | (950) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation expense | 5118 | 6056 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Excess tax (benefit) expense from stock compensation | (98) | 410 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net (accretion) amortization of (discounts) premiums on debt securities | (242) | (482) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrealized (gain) loss on equity securities recognized in earnings | (199) | 147 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in cash surrender value and mortality rates of BOLI | (724) | 600 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on sales of AFS debt securities |  | 6304 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in fair value of government guaranteed loans using fair value option | 3074 | (638) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on sales of mortgage LHFS | (100) | (47) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on sales of government guaranteed loans | (8063) | (4612) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Servicing asset impairment (recoveries) | 44 | (279) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Originations of LHFS | (48567) | (24103) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sales of LHFS | 71318 | 39530 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Write-down of OREO | 2986 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net change in other assets | 28149 | 13864 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net change in accounts payable and other liabilities | (56597) | (23647) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash provided by operating activities** | 70972 | 85560 |
| **Cash flows from investing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Purchases of AFS debt securities | (522712) | (415605) |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sales of AFS debt securities |  | 113794 |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from maturities, calls and pay downs of AFS debt securities | 596177 | 195263 |
| &nbsp;&nbsp;&nbsp;&nbsp;Maturity, calls and paydowns of HTM debt securities | 6835 | 2460 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net change in other investments | (4149) | 206 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net change in loans | 16429 | (238191) |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sale of government guaranteed loans | 24024 | 19220 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net disposals to premises and equipment | (5675) | (1898) |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sales of OREO and repossessed assets | 15453 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash provided by (used in) investing activities** | 126382 | (324751) |
| **Cash flows from financing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net (decrease) increase in deposits | (332497) | 388836 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net increase (decrease) in advances from FHLB | 169000 | (100000) |
| &nbsp;&nbsp;&nbsp;&nbsp;Payments to tax authorities for stock-based compensation | (4225) | (1575) |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from exercise of employee stock options | 166 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Purchase of treasury stock | (16569) | (3497) |
| &nbsp;&nbsp;&nbsp;&nbsp;Redemption of subordinated notes | (75000) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividends paid | (22864) | (21799) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash (used in) provided by financing activities** | (281989) | 261965 |
| Net change in cash and cash equivalents | (84635) | 22774 |
| Cash and cash equivalents at beginning of period | 855200 | 629063 |
| Cash and cash equivalents at end of period | $770565 | $651837 |

---

See accompanying Notes to Consolidated Financial Statements.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**VERITEX HOLDINGS, INC. AND SUBSIDIARIES**

**Notes to Consolidated Financial Statements (Unaudited)**

***(Dollars in thousands, except for per share amounts)*** 

**1. Operations and Summary of Significant Accounting Policies**

<u>Organization and Nature of Business</u>

In this report, the words "Veritex," "the Company," "we," "us," and "our" refer to the combined entities of Veritex Holdings, Inc. and its subsidiaries, including Veritex Community Bank. The word "Holdco" refers to Veritex Holdings, Inc. The word "Bank" refers to Veritex Community Bank.

Veritex is a Texas state banking organization, with corporate offices in Dallas, Texas, and currently operates 19 branches in the DFW metroplex and 12 branches in the Houston metropolitan area. The Bank provides a full range of banking services, including commercial and retail lending and the acceptance of checking and savings deposits, to individual and corporate customers. The TDB and the Board of Governors of the Federal Reserve are the primary regulators of the Company and the Bank, and both regulatory agencies perform periodic examinations to ensure regulatory compliance.

<u>Basis of Presentation</u>

The accompanying unaudited consolidated financial statements include the accounts of Veritex Holdings, Inc. and its subsidiaries, including the Bank.

The accompanying unaudited consolidated financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. As such, the interim financial statements do not include all of the information and footnotes required for complete financial statements. Intercompany transactions and balances are eliminated in consolidation. In management's opinion, these unaudited consolidated financial statements include all adjustments of a normal recurring nature necessary for a fair presentation of the Company's consolidated balance sheets at June 30, 2025 and December 31, 2024, consolidated statements of income, consolidated statements of comprehensive income (loss) and consolidated changes in stockholders' equity for the three and six months ended June 30, 2025 and 2024, as well as consolidated statements of cash flows for the six months ended June 30, 2025 and 2024.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Accounting measurements inherently involve reliance on estimates for the interim periods shown herein are not necessarily indicative of results to be expected for the full year due in part to global economic and financial market conditions, interest rates, access to sources of liquidity, market competition and interruptions of business processes. Actual results could differ from these estimates.

These unaudited consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto for the year ended December 31, 2024 included in the Company's Annual Report on Form 10-K.

<u>Reclassifications</u>

Certain prior period financial statement and disclosure amounts have been reclassified to conform to current period presentation. The reclassifications have no effect on net income or stockholders'equity as previously reported.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

<u>EPS</u>

EPS is based upon the weighted average shares outstanding. The table below sets forth the reconciliation between weighted average shares used for calculating basic and diluted EPS for the three and six months ended June 30, 2025 and 2024:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Six Months Ended June 30,** | **Six Months Ended June 30,** |
| *(In thousands, except per share amounts)* | **2025** | **2024** | **2025** | **2024** |
| **Numerator:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net income | $30906 | $27202 | $59976 | $51358 |
| **Denominator:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Weighted average shares outstanding for basic EPS | 54251 | 54457 | 54368 | 54451 |
| &nbsp;&nbsp;&nbsp;&nbsp;Dilutive effect of employee stock-based awards | 515 | 366 | 576 | 381 |
| Adjusted weighted average shares outstanding | $54766 | $54823 | $54944 | $54832 |
| **EPS:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Basic | $0.57 | $0.50 | $1.10 | $0.94 |
| &nbsp;&nbsp;&nbsp;&nbsp;Diluted | $0.56 | $0.50 | $1.09 | $0.94 |
| Antidilutive shares | 319 | 912 | 312 | 1062 |

---

<u>Segment Reporting</u>

The Company has one reportable segment. All of the Company's activities are interrelated, and each activity is dependent and assessed based on how it supports the others. For example, lending is dependent upon the ability of the Company to fund itself with deposits and borrowings while managing interest rate and credit risk. Accordingly, all significant operating decisions are based upon analysis of the Bank as one segment or unit. The Company's CODM, the Chief Executive Officer, uses the consolidated results to make operating and strategic decisions.

The Company has determined that all of its banking divisions and subsidiaries meet the aggregation criteria of ASC 280, Segment Reporting, as its current operating model is structured whereby banking divisions and subsidiaries serve a similar base of primarily commercial clients utilizing a company-wide offering of similar products and services managed through similar processes and platforms that are collectively reviewed by the CODM.

The CODM regularly assesses performance of the aggregated single operating and reporting segment and decides how to allocate resources based on net income calculated on the same basis as net income reported in the Company's consolidated statements of income and other comprehensive income. The CODM is also regularly provided with expense information at a level consistent with that disclosed in the Company's consolidated statements of income and other comprehensive income.

<u>Recent Accounting Pronouncements</u>

ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures" ("ASU 2023-09") enhances the transparency and decision usefulness of income tax disclosures. ASU 2023-09 will require disaggregated information about a reporting entity's effective tax rate reconciliation as well as information on income taxes paid. The Company will also be required to disclose income tax expense/(benefit) from continuing operations disaggregated by federal, state and foreign tax. ASU 2023-09 is effective for the annual period beginning January 1, 2025 and is not expected to have a significant impact on our financial statements.

ASU 2024-03,"Income Statement Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses" ("ASU 2024-03") requires entities to disclose additional information about specific expense categories in the notes to the financial statements. ASU 2024-03 is effective for the Company in the annual period beginning January 1, 2027 and interim periods beginning January 1, 2028 and can be applied on either a prospective or retrospective basis. The standard is not expected to have a significant impact on the Company's financial statements.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**2. Supplemental Statement of Cash Flows**

Other supplemental cash flow information is presented below:

---

| | | |
|:---|:---|:---|
| | **Six Months Ended June 30,** | **Six Months Ended June 30,** |
| *(Dollars in thousands)* | **2025** | **2024** |
| **Cash transactions:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash paid for interest | $176065 | $194144 |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash paid for income taxes | 20879 | 1826 |
| **Noncash transactions:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Right-of-use assets obtained in exchange for lease liabilities | $774 | $1087 |
| &nbsp;&nbsp;&nbsp;&nbsp;Transfer of loans to other real estate | 3330 | 26650 |

---

**3. Share Transactions**&nbsp;&nbsp;&nbsp;&nbsp;

*Stock Buyback Program*

On March 26, 2024, the Board authorized a stock buyback program (the "Stock Buyback Program") pursuant to which the Company could, from time to time, purchase up to $50,000 of its outstanding common stock in the aggregate. On March 25, 2025, the Board authorized the extension of the Stock Buyback Program through March 31, 2026. The Stock Buyback Program does not obligate the Company to repurchase any of its shares and may be suspended, terminated, amended or modified by the Board at any time without prior notice at the Board's discretion. The shares may be repurchased in the open market or in privately negotiated transactions from time to time, depending upon market conditions and other factors, and in accordance with applicable regulations of the SEC.

Shares repurchased through the periods indicated are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Six Months Ended June 30,** | **Six Months Ended June 30,** |
| | **2025** | **2024** | **2025** | **2024** |
| Numbers of shares repurchased | 286291 | 175688 | 663637 | 175688 |
| Weighted average price per share | $24.06 | $19.90 | $24.72 | $19.90 |

---

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**4. Securities**

*Equity Securities With a Readily Determinable Fair Value*

The Company held equity securities with a fair value of $9,980 and $9,781 at June 30, 2025 and December 31, 2024, respectively. The Company did not realize a loss on equity securities with a readily determinable fair value during the three and six months ended June 30, 2025 or 2024. The gross unrealized gain (loss) recognized on equity securities with readily determinable fair values recorded in other noninterest income in the Company's consolidated statements of income is as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Six Months Ended June 30,** | **Six Months Ended June 30,** |
| *(Dollars in thousands)* | **2025** | **2024** | **2025** | **2024** |
| Unrealized gain (loss) recognized on equity securities with a readily determinable fair value | $31 | $(42) | $199 | $(147) |

---

*Equity Securities Without a Readily Determinable Fair Value*

The Company held equity securities without a readily determinable fair value and measured at aggregate cost of $10,512 and $12,272 as of June 30, 2025 and December 31, 2024, respectively.

*Debt Securities*

Debt securities have been classified in the consolidated balance sheets according to management's intent. The amortized cost, related gross unrealized gains and losses, as well as the fair value of AFS and HTM debt securities are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
| *(Dollars in thousands)* | **Amortized Cost** | **Gross Unrealized Gains** | **Gross Unrealized Losses** | **Fair Value** |
| **AFS** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Corporate bonds | $271390 | $1920 | $12120 | $261190 |
| &nbsp;&nbsp;&nbsp;&nbsp;Municipal securities | 28100 |  | 5003 | 23097 |
| &nbsp;&nbsp;&nbsp;&nbsp;MBS | 245360 | 3820 | 11866 | 237314 |
| &nbsp;&nbsp;&nbsp;&nbsp;CMO | 571639 | 1498 | 30325 | 542812 |
| &nbsp;&nbsp;&nbsp;&nbsp;Asset-backed securities | 97433 | 974 | 1772 | 96635 |
| &nbsp;&nbsp;&nbsp;&nbsp;Collateralized loan obligations | 81762 | 18 | 543 | 81237 |
|  | $1295684 | $8230 | $61629 | $1242285 |
| **HTM** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;MBS | $30149 | $— | $5837 | $24312 |
| &nbsp;&nbsp;&nbsp;&nbsp;CMO | 32044 |  | 3638 | 28406 |
| &nbsp;&nbsp;&nbsp;&nbsp;Municipal securities | 114326 |  | 14725 | 99601 |
|  | $176519 | $— | $24200 | $152319 |

---

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| *(Dollars in thousands)* | **Amortized Cost** | **Gross Unrealized Gains** | **Gross Unrealized Losses** | **Fair Value** |
| **AFS** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Corporate bonds | $271889 | $1815 | $17184 | $256520 |
| &nbsp;&nbsp;&nbsp;&nbsp;Municipal securities | 28142 |  | 3797 | 24345 |
| &nbsp;&nbsp;&nbsp;&nbsp;MBS | 258896 | 2256 | 14822 | 246330 |
| &nbsp;&nbsp;&nbsp;&nbsp;CMO | 600709 | 1734 | 41841 | 560602 |
| &nbsp;&nbsp;&nbsp;&nbsp;Asset-backed securities | 110148 | 563 | 2745 | 107966 |
| &nbsp;&nbsp;&nbsp;&nbsp;Collateralized loan obligations | 98885 | 106 | 242 | 98749 |
|  | $1368669 | $6474 | $80631 | $1294512 |
| **HTM** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;MBS | $31439 | $— | $6625 | $24814 |
| &nbsp;&nbsp;&nbsp;&nbsp;CMO | 32892 |  | 4920 | 27972 |
| &nbsp;&nbsp;&nbsp;&nbsp;Municipal securities | 119695 |  | 11921 | 107774 |
|  | $184026 | $— | $23466 | $160560 |

---

Accrued interest receivable totaled $7,866 and $8,320 on AFS and $1,570 and $1,631 on HTM securities as of June 30, 2025 and December 31, 2024, respectively, and was included in other assets on the accompanying consolidated balance sheets.

At June 30, 2025 and December 31, 2024, securities with a carrying balance of approximately $1,174,629 and $1,236,424, respectively, were pledged as collateral for public fund deposits, borrowings or for other purposes required or permitted by law.

In 2022, the Company transferred AFS debt securities with an aggregate fair value of $117,001 to a classification of HTM debt securities. The transfer from AFS to HTM was recorded at the fair value of the AFS debt securities at the time of transfer. The net unrealized holding gain retained in AOCI for securities transferred from AFS to HTM was $2,094 and $2,437 at June 30, 2025 and December 31, 2024, respectively. The Company did not transfer any debt securities from AFS to HTM during the six months ended June 30, 2025.

The following tables disclose the Company's debt securities in an unrealized loss position, aggregated by investment category and length of time that individual debt securities have been in a continuous loss position:

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
| | **Less Than 12 Months** | **Less Than 12 Months** | **12 Months or More** | **12 Months or More** | **Totals** | **Totals** |
| *(Dollars in thousands)* | **Fair<br>Value** | **Unrealized<br>Loss** | **Fair<br>Value** | **Unrealized<br>Loss** | **Fair<br>Value** | **Unrealized<br>Loss** |
| **AFS** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Corporate bonds | $51123 | $1510 | $134134 | $10610 | $185257 | $12120 |
| &nbsp;&nbsp;&nbsp;&nbsp;Municipal securities | 14358 | 1739 | 8739 | 3264 | 23097 | 5003 |
| &nbsp;&nbsp;&nbsp;&nbsp;MBS | 8396 | 161 | 71384 | 11705 | 79780 | 11866 |
| &nbsp;&nbsp;&nbsp;&nbsp;CMO | 182948 | 2374 | 244295 | 27951 | 427243 | 30325 |
| &nbsp;&nbsp;&nbsp;&nbsp;Asset-backed securities | 2670 | 12 | 41983 | 1760 | 44653 | 1772 |
| &nbsp;&nbsp;&nbsp;&nbsp;Collateralized loan obligations | 52164 | 394 | 9035 | 149 | 61199 | 543 |
|  | $311659 | $6190 | $509570 | $55439 | $821229 | $61629 |
| **HTM** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;MBS | $— | $— | $24312 | $5837 | $24312 | $5837 |
| &nbsp;&nbsp;&nbsp;&nbsp;CMO |  |  | 28406 | 3638 | 28406 | 3638 |
| &nbsp;&nbsp;&nbsp;&nbsp;Municipal securities | 75747 | 9994 | 21417 | 4731 | 97164 | 14725 |
|  | $75747 | $9994 | $74135 | $14206 | $149882 | $24200 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| *(Dollars in thousands)* | **Less Than 12 Months** | **Less Than 12 Months** | **12 Months or More** | **12 Months or More** | **Totals** | **Totals** |
|  | **Fair<br>Value** | **Unrealized Loss** | **Fair<br>Value** | **Unrealized Loss** | **Fair<br>Value** | **Unrealized Loss** |
| **AFS** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Corporate bonds | $38914 | $2329 | $174876 | $14855 | $213790 | $17184 |
| &nbsp;&nbsp;&nbsp;&nbsp;Municipal securities | 15519 | 594 | 8826 | 3203 | 24345 | 3797 |
| &nbsp;&nbsp;&nbsp;&nbsp;MBS | 71889 | 694 | 74131 | 14128 | 146020 | 14822 |
| &nbsp;&nbsp;&nbsp;&nbsp;CMO | 168016 | 3383 | 247079 | 38458 | 415095 | 41841 |
| &nbsp;&nbsp;&nbsp;&nbsp;Asset-backed securities | 71538 | 635 | 13034 | 2110 | 84572 | 2745 |
| &nbsp;&nbsp;&nbsp;&nbsp;Collateralized loan obligations | 40406 | 242 |  |  | 40406 | 242 |
|  | $406282 | $7877 | $517946 | $72754 | $924228 | $80631 |
| **HTM** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;MBS | $— | $— | $24814 | $6625 | $24814 | $6625 |
| &nbsp;&nbsp;&nbsp;&nbsp;CMO |  |  | 27972 | 4920 | 27972 | 4920 |
| &nbsp;&nbsp;&nbsp;&nbsp;Municipal securities | 83738 | 8198 | 22679 | 3723 | 106417 | 11921 |
|  | $83738 | $8198 | $75465 | $15268 | $159203 | $23466 |

---

Management evaluates AFS debt securities in unrealized loss positions to determine whether the impairment is due to credit-related factors or noncredit-related factors. Consideration is given to (1) the extent to which the fair value is less than cost, (2) the financial condition and near-term prospects of the issuer, and (3) the intent and ability of the Company to retain its investment in the security for a period of time sufficient to allow for any anticipated recovery in fair value.

The number of AFS debt securities in an unrealized loss position totaled 127 and 137 at June 30, 2025 and December 31, 2024, respectively. Management does not have the intent to sell any of these debt securities and believes that it is more likely than not that the Company will not have to sell any such debt securities before a recovery of cost. The fair value is expected to recover as the debt securities approach their maturity date or repricing date or if market yields for such investments decline. Accordingly, as of June 30, 2025, management believes that the unrealized losses detailed in the previous table are due to noncredit-related factors, including changes in interest rates and other market conditions, and therefore no ACL has been recognized.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

The amortized costs and estimated fair values of AFS and HTM debt securities, by contractual maturity, as of the dates indicated, are shown in the table below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. MBS, CMOs, asset-backed securities, and collateralized loan obligations typically are issued with stated principal amounts, and the securities are backed by pools of mortgage loans and other loans that have varying maturities. The terms of MBS, CMOs, asset-backed securities, and collateralized loan obligations thus approximates the terms of the underlying mortgages and loans and can vary significantly due to prepayments. Therefore, these securities are not included in the maturity categories below.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
| | **AFS** | **AFS** | **HTM** | **HTM** |
| *(Dollars in thousands)* | **Amortized Cost** | **Fair Value** | **Amortized Cost** | **Fair Value** |
| Due in one year or less | $— | $— | $— | $— |
| Due from one year to five years | 88789 | 88292 | 2649 | 2625 |
| Due from five years to ten years | 171752 | 162263 | 16691 | 16218 |
| Due after ten years | 38949 | 33732 | 94986 | 80758 |
|  | 299490 | 284287 | 114326 | 99601 |
| MBS and CMO | 816999 | 780126 | 62193 | 52718 |
| Asset-backed securities | 97433 | 96635 |  |  |
| Collateralized loan obligations | 81762 | 81237 |  |  |
|  | $1295684 | $1242285 | $176519 | $152319 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| | **AFS** | **AFS** | **HTM** | **HTM** |
| *(Dollars in thousands)* | **Amortized Cost** | **Fair Value** | **Amortized Cost** | **Fair Value** |
| Due in one year or less | $— | $— | $3919 | $3919 |
| Due from one year to five years | 69451 | 68737 | 890 | 857 |
| Due from five years to ten years | 176147 | 163478 | 19464 | 18857 |
| Due after ten years | 54433 | 48650 | 95422 | 84141 |
|  | 300031 | 280865 | 119695 | 107774 |
| MBS and CMO | 859605 | 806932 | 64331 | 52786 |
| Asset-backed securities | 110148 | 107966 |  |  |
| Collateralized loan obligations | 98885 | 98749 |  |  |
|  | $1368669 | $1294512 | $184026 | $160560 |

---

Proceeds from sales of debt securities AFS and gross gains and losses for the three and six months ended June 30, 2025 and 2024 were as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months ended June 30,** | **Three Months ended June 30,** | **Six Months ended June 30,** | **Six Months ended June 30,** |
| *(Dollars in thousands)* | **2025** | **2024** | **2025** | **2024** |
| Proceeds from sales | $— | $— | $— | $113794 |
| Gross realized gains |  |  |  |  |
| Gross realized losses |  |  |  | 6304 |

---

As of June 30, 2025 and December 31, 2024, there were no holdings of securities of any one issuer, other than the U.S. government and its agencies, in an amount greater than 10% of stockholders' equity.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**5. LHI and ACL**

LHI in the accompanying consolidated balance sheets are summarized as follows:

---

| | | |
|:---|:---|:---|
| *(Dollars in thousands)* | **June 30, 2025** | **December 31, 2024** |
| LHI, carried at amortized cost: |  |  |
| &nbsp;&nbsp;&nbsp;Real estate: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Construction and land | $1142457 | $1303711 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Farmland | 31589 | 31690 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1 - 4 family residential | 1086342 | 957341 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Multi-family residential | 718946 | 750218 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;OOCRE | 800881 | 780003 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOOCRE | 2311466 | 2382499 |
| &nbsp;&nbsp;Commercial | 2692209 | 2693538 |
| &nbsp;&nbsp;&nbsp;MW | 669052 | 605411 |
| &nbsp;&nbsp;&nbsp;Consumer | 8796 | 9115 |
|  | $9461738 | $9513526 |
| &nbsp;&nbsp;&nbsp;Deferred loan fees, net | (8698) | (8982) |
| &nbsp;&nbsp;&nbsp;ACL | (112262) | (111745) |
| &nbsp;&nbsp;&nbsp;&nbsp;Total LHI, net | $9340778 | $9392799 |

---

Included in the total LHI, net, as of June 30, 2025 and December 31, 2024 was an accretable discount related to purchased performing and PCD loans acquired in the approximate amounts of $1,855 and $3,870, respectively. The discount is being accreted into income on a level-yield basis over the life of the loans. In addition, included in the net loan portfolio as of June 30, 2025 and December 31, 2024 is a discount on retained loans from sale of originated SBA and USDA loans of $9,663 and $7,851, respectively.

Loan accrued interest receivable totaled $34,430 and $34,726 at June 30, 2025 and December 31, 2024, respectively, and was included in other assets on the accompanying consolidated balance sheets.

*ACL*

The Company's estimate of the ACL reflects losses expected over the remaining contractual life of the assets. The activity in the ACL related to LHI is as follows:

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** |
| *(Dollars in thousands)* | **Construction and Land** | **Farmland** | **Residential** | **Multifamily** | **OOCRE** | **NOOCRE** | **Commercial** | **MW** | **Consumer** | **Total** |
| Balance at beginning of the period | $19419 | $100 | $16823 | $4954 | $17791 | $35491 | $16728 | $371 | $96 | $111773 |
| &nbsp;&nbsp;Credit loss expense (benefit) non-PCD loans | 962 | (8) | 1664 | (750) | (1127) | (497) | 1653 | (159) | (210) | 1528 |
| &nbsp;&nbsp;Credit loss expense PCD loans |  |  | 65 |  | 157 |  |  |  |  | 222 |
| &nbsp;&nbsp;Charge-offs |  |  |  |  |  | (215) | (1571) |  | (55) | (1841) |
| &nbsp;&nbsp;Recoveries |  |  | 1 |  | 186 |  | 131 |  | 262 | 580 |
| Ending Balance | $20381 | $92 | $18553 | $4204 | $17007 | $34779 | $16941 | $212 | $93 | $112262 |

---

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** |
| *(Dollars in thousands)* | **Construction and Land** | **Farmland** | **Residential** | **Multifamily** | **OOCRE** | **NOOCRE** | **Commercial** | **MW** | **Consumer** | **Total** |
| Balance at beginning of the period | $19781 | $107 | $11516 | $6339 | $9802 | $31137 | $32791 | $404 | $155 | $112032 |
| &nbsp;&nbsp;Credit loss expense (benefit) non-PCD loans | 1113 | (8) | (2310) | (387) | 3092 | 4195 | 2011 | 871 | (418) | 8159 |
| &nbsp;&nbsp;Credit loss expense (benefit) PCD loans |  |  | 6 |  | 86 |  | (1) |  |  | 91 |
| &nbsp;&nbsp;Charge-offs |  |  | (31) | (198) |  | (1969) | (5601) |  | (30) | (7829) |
| &nbsp;&nbsp;Recoveries |  |  |  |  | 120 |  | 361 |  | 497 | 978 |
| Ending Balance | $20894 | $99 | $9181 | $5754 | $13100 | $33363 | $29561 | $1275 | $204 | $113431 |

---

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** |
| *(Dollars in thousands)* | **Construction and land** | **Farmland** | **Residential** | **Multifamily** | **OOCRE** | **NOOCRE** | **Commercial** | **MW** | **Consumer** | **Total** |
| Balance at beginning of the period | $15457 | $97 | $15639 | $4849 | $17546 | $39968 | $17654 | $321 | $214 | $111745 |
| &nbsp;&nbsp;Credit loss expense (benefit) non-PCD loans | 4924 | (5) | 2831 | (645) | (871) | (1884) | 1621 | (109) | (311) | 5551 |
| &nbsp;&nbsp;Credit loss expense (benefit) PCD loans |  |  | 61 |  | 146 |  | (8) |  |  | 199 |
| &nbsp;&nbsp;Charge-offs |  |  |  |  |  | (3305) | (2489) |  | (267) | (6061) |
| &nbsp;&nbsp;Recoveries |  |  | 22 |  | 186 |  | 163 |  | 457 | 828 |
| Ending Balance | $20381 | $92 | $18553 | $4204 | $17007 | $34779 | $16941 | $212 | $93 | $112262 |

---

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** |
| *(Dollars in thousands)* | **Construction and land** | **Farmland** | **Residential** | **Multifamily** | **OOCRE** | **NOOCRE** | **Commercial** | **MW** | **Consumer** | **Total** |
| Balance at beginning of the period | $21032 | $101 | $9539 | $4882 | $10252 | $27729 | $35886 | $260 | $135 | $109816 |
| &nbsp;&nbsp;Credit loss (benefit) expense non-PCD loans | (138) | (2) | (332) | 1070 | 3139 | 15848 | (125) | 1015 | (376) | 20099 |
| &nbsp;&nbsp;Credit loss expense (benefit) PCD loans |  |  | 4 |  | (291) | (3952) | (110) |  |  | (4349) |
| &nbsp;&nbsp;Charge-offs |  |  | (31) | (198) | (120) | (6262) | (6547) |  | (101) | (13259) |
| &nbsp;&nbsp;Recoveries |  |  | 1 |  | 120 |  | 457 |  | 546 | 1124 |
| Ending Balance | $20894 | $99 | $9181 | $5754 | $13100 | $33363 | $29561 | $1275 | $204 | $113431 |

---

A loan is considered collateral-dependent when the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the operation or sale of the collateral. The following table presents the amortized cost basis of collateral dependent loans, which are individually evaluated to determine expected credit losses, and the related ACL allocated to these loans:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **June 30, 2025** | **June 30, 2025** | **December 31, 2024** | **December 31, 2024** |
| *(Dollars in thousands)* | **Real Property** | **ACL Allocation** | **Real Property** | **ACL Allocation** |
| OOCRE | $— | $— | $1925 | $84 |
| NOOCRE | 24187 |  |  |  |
| Commercial | 1932 | 402 | 2873 | 532 |
| Total | $26119 | $402 | $4798 | $616 |

---

*Nonaccrual and Past Due Loans*

Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due in accordance with the terms of the loan agreement. Loans are placed on nonaccrual status when, in management's opinion, the borrower may be unable to meet payment obligations as they become due, as well as when required by regulatory provisions. Loans may be placed on nonaccrual status regardless of whether or not such loans are considered past due. When the accrual of interest is discontinued, all unpaid accrued interest is reversed. Interest income is subsequently recognized only to the extent cash payments are received in excess of principal due. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

Nonaccrual loans aggregated by class of loans, as of June 30, 2025 and December 31, 2024, were as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **June 30, 2025** | **June 30, 2025** | **December 31, 2024** | **December 31, 2024** |
| *(Dollars in thousands)* | **Nonaccrual** | **Nonaccrual With No ACL** | **Nonaccrual** | **Nonaccrual With No ACL** |
| Construction and land | $6120 | $6120 | $6373 | $6373 |
| 1 - 4 family residential | 1347 | 1347 | 1562 | 1562 |
| OOCRE | 8789 | 8789 | 8887 | 6962 |
| NOOCRE | 27486 | 27486 | 10967 | 5309 |
| Commercial | 17550 | 5336 | 24680 | 8935 |
| Consumer | 46 | 46 | 52 | 52 |
| Total | $61338 | $49124 | $52521 | $29193 |

---

During the three months ended June 30, 2025 and 2024, interest income not recognized on nonaccrual loans was $587 and $763, respectively. During the six months ended June 30, 2025 and 2024, interest income not recognized on non-accrual loans was $1,572 and $1,544, respectively.

An age analysis of past due loans, aggregated by class of loans and including past due nonaccrual loans, as of June 30, 2025 and December 31, 2024, is as follows:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
| *(Dollars in thousands)* | **30 to 59 Days** | **60 to 89 Days** | **90 Days or Greater** | **Total Past Due** | **Total Current** | **Total <br>Loans** | **Total 90 Days Past Due and Still Accruing** |
| Real estate: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Construction and land | $— | $613 | $6120 | $6733 | $1135724 | $1142457 | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;Farmland |  |  |  |  | 31589 | 31589 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;1 - 4 family residential | 967 | 3107 | 5300 | 9374 | 1076968 | 1086342 | 4589 |
| &nbsp;&nbsp;&nbsp;&nbsp;Multi-family residential |  |  |  |  | 718946 | 718946 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;OOCRE | 558 | 698 | 7249 | 8505 | 792376 | 800881 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;NOOCRE | 10339 | 635 | 18085 | 29059 | 2282407 | 2311466 |  |
| Commercial | 3501 | 1586 | 1482 | 6569 | 2685640 | 2692209 | 52 |
| MW |  |  |  |  | 669052 | 669052 |  |
| Consumer | 55 | 20 | 34 | 109 | 8687 | 8796 |  |
| Total | $15420 | $6659 | $38270 | $60349 | $9401389 | $9461738 | $4641 |

---

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| *(Dollars in thousands)* | **30 to 59 Days** | **60 to 89 Days** | **90 Days or Greater** | **Total Past Due** | **Total Current** | **Total <br>Loans** | **Total 90 Days Past Due and Still Accruing** |
| Real estate: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Construction and land | $— | $— | $6373 | $6373 | $1297338 | $1303711 | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;Farmland |  |  |  |  | 31690 | 31690 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;1 - 4 family residential | 991 | 1036 | 2832 | 4859 | 952482 | 957341 | 1865 |
| &nbsp;&nbsp;&nbsp;&nbsp;Multi-family residential |  |  |  |  | 750218 | 750218 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;OOCRE | 9571 | 874 | 8887 | 19332 | 760671 | 780003 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;NOOCRE | 14329 | 1615 | 9024 | 24968 | 2357531 | 2382499 |  |
| Commercial | 785 | 1976 | 5595 | 8356 | 2685182 | 2693538 | 49 |
| MW |  |  |  |  | 605411 | 605411 |  |
| Consumer | 55 | 6 | 36 | 97 | 9018 | 9115 |  |
| Total | $25731 | $5507 | $32747 | $63985 | $9449541 | $9513526 | $1914 |

---

Loans 90 days past due and still accruing interest are considered well-secured and in the process of collection as of the reporting date with plans in place for the borrowers to bring the notes fully current. The Company believes that it will collect all principal and interest due on each of the loans 90 days past due and still accruing.

*Modifications to Borrowers Experiencing Financial Difficulty*

Occasionally, the Company modifies loans to borrowers experiencing financial difficulty by providing certain concessions, such as principal forgiveness, term extension, payment deferral, interest rate reduction, or a combination of such concessions. An assessment of whether a borrower is experiencing financial difficulty is made on the date of a modification. Because the effect of most modifications made to borrowers experiencing financial difficulty is already included in the ACL (due to the measurement methodologies used to estimate the allowance), a change to the ACL is generally not recorded upon modification.

The following table shows the amortized cost basis at the end of the reporting period of the loans modified to borrowers experiencing financial difficulty, disaggregated by class of financing receivable and type of concession granted during the three and six months ended June 30, 2025 and 2024:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** | **Three Months Ended June 30, 2025** |
| | | | | **Financial Impact** | **Financial Impact** | **Financial Impact** |
| *(Dollars in thousands)* | **Payment Deferral** | **Combination of payment deferral, interest rate reduction and/or term extension** | **% of Loan Class** | **Interest Rate Reduction (in months)** | **Term Extension (in Months)** | **Payment Deferrals (in months)** |
| Construction and land | $7694 | $— | 0.7% |  |  | > 3 months |
| OOCRE |  | 1195 | 0.1 |  | >3 months | >3 months |
| NOOCRE | 428 | 1180 | 0.1 |  | >3 months | > 3 months |
| Commercial | 23704 |  | 0.9 |  |  | > 3 months |
| Total | $31826 | $2375 |  |  |  |  |

---

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

---

| | | | |
|:---|:---|:---|:---|
| | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** | **Three Months Ended June 30, 2024** |
| | | | **Financial Impact** |
| *(Dollars in thousands)* | **Payment Deferral** | **% of Loan Class** | **Payment Deferrals (in months)** |
| Construction and land | $11714 | 0.8% | > 3 months |
| NOOCRE | 1407 | 0.1 | > 3 months |
| Commercial | 908 |  | > 3 months |
| Total | $14029 |  |  |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2025** |
| | | | | **Financial Impact** | **Financial Impact** | **Financial Impact** |
| *(Dollars in thousands)* | **Payment Deferral** | **Combination of payment deferral, interest rate reduction and/or term extension** | **% of Loan Class** | **Interest Rate Reduction (in months)** | **Term Extension (in Months)** | **Payment Deferrals (in months)** |
| Construction and land | $7694 | $— | 0.7% |  |  | > 3 months |
| OOCRE | 2318 | 1195 | 0.4 |  | >3 months | > 3 months |
| NOOCRE | 428 | 21649 | 1.0 | >3 months |  | > 3 months |
| Commercial | 24254 | 3631 | 1.0 |  | >3 months | > 3 months |
| Total | $34694 | $26475 |  |  |  |  |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** | **Six Months Ended June 30, 2024** |
| | | | | | **Financial Impact** | **Financial Impact** | **Financial Impact** |
| *(Dollars in thousands)* | **Interest Rate Reduction** | **Payment Deferral** | **Combination of payment deferral, interest rate reduction and/or term extension** | **% of Loan Class** | **Interest Rate Reduction (in months)** | **Term Extension (in Months)** | **Payment Deferrals (in months)** |
| Construction and land | $— | $11714 | $— | 0.8% |  |  | > 3 months |
| NOOCRE | 28386 | 3407 | 45762 | 3.2 | > 3 months |  | > 3 months |
| Commercial |  | 908 | 4631 | 0.2 |  | > 3 months | > 3 months |
| Total | $28386 | $16029 | $50393 |  |  |  |  |

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

The Company closely monitors the performance of the loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table depicts the performance of loans that have been modified in the last 12 months:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
| | **Payment Status** | **Payment Status** | **Payment Status** | **Payment Status** |
| *(Dollars in thousands)* | **Current** | **30-59 Days Past Due** | **60-89 Days Past Due** | **90+ Days Past Due** |
| Construction and land | $7694 | $— | $— | $— |
| OOCRE | 2318 |  |  | 1195 |
| NOOCRE | 50180 |  |  |  |
| Commercial | 30915 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total | $91107 | $— | $— | $1195 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| **June 30, 2024** | **June 30, 2024** | **June 30, 2024** | **June 30, 2024** | **June 30, 2024** |
| | **Payment Status** | **Payment Status** | **Payment Status** | **Payment Status** |
| *(Dollars in thousands)* | **Current** | **30-59 Days Past Due** | **60-89 Days Past Due** | **90+ Days Past Due** |
| Construction and land | $11714 | $— | $— | $— |
| NOOCRE | 76148 |  |  | 1407 |
| Commercial | 21367 |  |  | 1917 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total | $109229 | $— | $— | $3324 |

---

The Company has not committed to lend additional material amounts to customers with outstanding loans classified as Troubled Loan Modifications as of June 30, 2025 or December 31, 2024.

*Credit Quality Indicators*

From a credit risk standpoint, the Company classifies its loans in one of the following categories: (i) pass, (ii) special mention, (iii) substandard or (iv) doubtful. Loans classified as loss are charged-off. Loans not rated special mention, substandard, doubtful or loss are classified as pass loans.

The classifications of loans reflect a judgment about the risks of default and loss associated with the loan. The Company reviews the ratings on criticized credits monthly. Ratings are adjusted to reflect the degree of risk and loss that is felt to be inherent in each credit as of each monthly reporting period. All classified credits are evaluated for impairment. If impairment is determined to exist, a specific reserve is established. The Company's methodology is structured so that specific reserves are increased in accordance with deterioration in credit quality (and a corresponding increase in risk and loss) or decreased in accordance with improvement in credit quality (and a corresponding decrease in risk and loss).

Credits rated special mention show clear signs of financial weaknesses or deterioration in credit worthiness, however, such concerns are generally not so pronounced that the Company expects to experience significant loss within the short-term. Such credits typically maintain the ability to perform within standard credit terms and credit exposure is not as prominent as credits with a lower rating.

Credits rated substandard are those in which the normal repayment of principal and interest may be, or has been, jeopardized by reason of adverse trends or developments of a financial, managerial, economic or political nature, or important weaknesses which exist in collateral. A protracted workout on these credits is a distinct possibility. PCA is therefore required to strengthen the Company's position, and/or to reduce exposure and to assure that adequate remedial measures are taken by the borrower. Credit exposure becomes more likely in such credits and a serious evaluation of the secondary support to the credit is performed.

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

Credits rated doubtful are those in which full collection of principal appears highly questionable, and in which some degree of loss is anticipated, even though the ultimate amount of loss may not yet be certain and/or other factors exist which could affect collection of debt. Based upon available information, positive action by the Company is required to avert or minimize loss. Credits rated doubtful are generally also placed on non-accrual.

Credits classified as PCD are those that, at acquisition date, have experienced a more-than-insignificant deterioration in credit quality since origination. All loans considered to be purchased-credit impaired loans prior to January 1, 2020 were converted to PCD loans upon adoption of ASC 326. The Company elected to maintain pools of loans that were previously accounted for under ASC 310-30 and will continue to account for these pools as a unit of account. Loans are only removed from the existing pools if they are foreclosed, written off, paid off, or sold.

The Company considers the guidance in ASC 310-20 when determining whether a modification, extension or renewal of a loan constitutes a current period origination. Generally, current period renewals of credit are re-underwritten at the point of renewal and considered current period originations for purposes of the table below. Based on the most recent analysis performed, the risk category of loans by class of loans based on year or origination as of June 30, 2025 and December 31, 2024 is as follows:

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Term Loans Amortized Cost Basis by Origination Year**<sup>(1)</sup> | **Term Loans Amortized Cost Basis by Origination Year**<sup>(1)</sup> | **Term Loans Amortized Cost Basis by Origination Year**<sup>(1)</sup> | **Term Loans Amortized Cost Basis by Origination Year**<sup>(1)</sup> | **Term Loans Amortized Cost Basis by Origination Year**<sup>(1)</sup> | **Term Loans Amortized Cost Basis by Origination Year**<sup>(1)</sup> | | | |
| *(Dollars in thousands)* | **2025** | **2024** | **2023** | **2022** | **2021** | **Prior** | **Revolving Loans Amortized Cost Basis** | **Revolving Loans Converted to Term** | **Total** |
| **As of June 30, 2025** |  |  |  |  |  |  |  |  |  |
| Construction and land: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $50675 | $246407 | $43768 | $488213 | $16046 | $3911 | $232609 | $— | $1081629 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention |  |  |  | 25640 |  |  |  |  | 25640 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  |  | 27040 | 7043 | 1074 | 31 |  |  | 35188 |
| Total construction and land | $50675 | $246407 | $70808 | $520896 | $17120 | $3942 | $232609 | $— | $1142457 |
| Construction and land gross charge-offs | $— | $— | $— | $— | $— | $— | $— | $— | $— |
| Farmland: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $993 | $2413 | $2450 | $2157 | $— | $21536 | $2040 | $— | $31589 |
| Total farmland | $993 | $2413 | $2450 | $2157 | $— | $21536 | $2040 | $— | $31589 |
| Farmland gross charge-offs | $— | $— | $— | $— | $— | $— | $— | $— | $— |
| 1 - 4 family residential: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $135746 | $100457 | $90503 | $232496 | $287085 | $184524 | $51035 | $548 | $1082394 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention |  |  |  | 177 |  | 68 |  |  | 245 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  |  |  |  | 811 | 1387 | 492 |  | 2690 |
| &nbsp;&nbsp;&nbsp;&nbsp;PCD |  |  |  |  |  | 1013 |  |  | 1013 |
| Total 1 - 4 family residential | $135746 | $100457 | $90503 | $232673 | $287896 | $186992 | $51527 | $548 | $1086342 |
| 1-4 family residential gross charge-offs | $— | $— | $— | $— | $— | $— | $— | $— | $— |
| Multi-family residential: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $12093 | $51041 | $4206 | $245125 | $288969 | $95199 | $— | $— | $696633 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention |  |  |  | 21764 |  |  |  |  | 21764 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  |  |  | 549 |  |  |  |  | 549 |
| Total multi-family residential | $12093 | $51041 | $4206 | $267438 | $288969 | $95199 | $— | $— | $718946 |
| Multi-family residential gross charge-offs | $— | $— | $— | $— | $— | $— | $— | $— | $— |
| OOCRE: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $69995 | $100397 | $99743 | $160984 | $87568 | $236011 | $3605 | $— | $758303 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention |  |  | 1620 | 2874 | 945 | 3680 |  |  | 9119 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  |  | 5262 | 57 | 8584 | 10757 |  |  | 24660 |
| &nbsp;&nbsp;&nbsp;&nbsp;PCD |  |  |  |  |  | 8799 |  |  | 8799 |
| Total OOCRE | $69995 | $100397 | $106625 | $163915 | $97097 | $259247 | $3605 | $— | $800881 |

---

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| OOCRE gross charge-offs | $— | $— | $— | $— | $— | $— | $— | $— | $— |
| NOOCRE: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $105781 | $222463 | $50477 | $640310 | $535570 | $628339 | $28863 | $403 | $2212206 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention |  |  |  | 16505 | 24048 | 15761 |  |  | 56314 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  |  |  | 6086 | 1678 | 34838 |  |  | 42602 |
| &nbsp;&nbsp;&nbsp;&nbsp;PCD |  |  |  |  |  | 344 |  |  | 344 |
| Total NOOCRE | $105781 | $222463 | $50477 | $662901 | $561296 | $679282 | $28863 | $403 | $2311466 |
| NOOCRE gross charge-offs | $— | $— | $— | $1000 | $— | $2305 | $— | $— | $3305 |
| Commercial: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $72364 | $154666 | $246198 | $277267 | $57002 | $77046 | $1632734 | $2547 | $2519824 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention | 5638 | 10081 | 8626 | 32611 |  | 192 | 21372 |  | 78520 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  | 1156 | 2917 | 27739 | 233 | 7181 | 54390 |  | 93616 |
| &nbsp;&nbsp;&nbsp;&nbsp;PCD |  |  |  |  |  | 249 |  |  | 249 |
| Total commercial | $78002 | $165903 | $257741 | $337617 | $57235 | $84668 | $1708496 | $2547 | $2692209 |
| Commercial gross charge-offs | $— | $— | $737 | $— | $— | $1752 | $— | $— | $2489 |
| MW: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $— | $— | $— | $— | $— | $— | $669052 | $— | $669052 |
| Total MW | $— | $— | $— | $— | $— | $— | $669052 | $— | $669052 |
| MW gross charge-offs | $— | $— | $— | $— | $— | $— | $— | $— | $— |
| Consumer: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $1279 | $1190 | $1601 | $422 | $174 | $1407 | $2605 | $— | $8678 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention |  |  |  |  |  | 66 |  |  | 66 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  |  |  |  |  | 48 |  |  | 48 |
| &nbsp;&nbsp;&nbsp;&nbsp;PCD |  |  |  |  |  | 4 |  |  | 4 |
| Total consumer | $1279 | $1190 | $1601 | $422 | $174 | $1525 | $2605 | $— | $8796 |
| Consumer gross charge-offs | $— | $— | $6 | $— | $— | $261 | $— | $— | $267 |
| Total Pass | $448926 | $879034 | $538946 | $2046974 | $1272414 | $1247973 | $2622543 | $3498 | $9060308 |
| Total Special Mention | 5638 | 10081 | 10246 | 99571 | 24993 | 19767 | 21372 |  | 191668 |
| Total Substandard |  | 1156 | 35219 | 41474 | 12380 | 54242 | 54882 |  | 199353 |
| Total PCD |  |  |  |  |  | 10409 |  |  | 10409 |
| Total | $454564 | $890271 | $584411 | $2188019 | $1309787 | $1332391 | $2698797 | $3498 | $9461738 |
| Current period gross charge-offs | $— | $— | $743 | $1000 | $— | $4318 | $— | $— | $6061 |

---

<sup>(1)</sup> Term loans amortized cost basis by origination year excludes $8,698 of deferred loan fees, net.

------

<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

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| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Term Loans Amortized Cost Basis by Origination Year**<sup>(1)</sup> | **Term Loans Amortized Cost Basis by Origination Year**<sup>(1)</sup> | **Term Loans Amortized Cost Basis by Origination Year**<sup>(1)</sup> | **Term Loans Amortized Cost Basis by Origination Year**<sup>(1)</sup> | **Term Loans Amortized Cost Basis by Origination Year**<sup>(1)</sup> | **Term Loans Amortized Cost Basis by Origination Year**<sup>(1)</sup> | | | |
| *(Dollars in thousands)* | **2024** | **2023** | **2022** | **2021** | **2020** | **Prior** | **Revolving Loans Amortized Cost Basis** | **Revolving Loans Converted to Term** | **Total** |
| **December 31, 2024** |  |  |  |  |  |  |  |  |  |
| Construction and land: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $144236 | $48138 | $732933 | $103292 | $756 | $4709 | $211546 | $465 | $1246075 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention |  |  | 24869 |  |  |  |  |  | 24869 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  | 25298 | 6342 | 1096 | 31 |  |  |  | 32767 |
| Total construction and land | $144236 | $73436 | $764144 | $104388 | $787 | $4709 | $211546 | $465 | $1303711 |
| Construction and land gross charge-offs | $— | $— | $— | $— | $— | $— | $— | $— | $— |
| Farmland: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $2447 | $2479 | $2317 | $— | $17452 | $4441 | $2554 | $— | $31690 |
| Total farmland | $2447 | $2479 | $2317 | $— | $17452 | $4441 | $2554 | $— | $31690 |
| Farmland gross charge-offs | $— | $— | $— | $— | $— | $— | $— | $— | $— |
| 1 - 4 family residential: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $91388 | $83605 | $198960 | $343223 | $81486 | $114086 | $33732 | $4589 | $951069 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention |  | 2701 |  |  |  | 65 |  |  | 2766 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  |  | 133 | 831 | 50 | 932 | 516 |  | 2462 |
| &nbsp;&nbsp;&nbsp;&nbsp;PCD |  |  |  |  |  | 1044 |  |  | 1044 |
| Total 1 - 4 family residential | $91388 | $86306 | $199093 | $344054 | $81536 | $116127 | $34248 | $4589 | $957341 |
| 1-4 Family gross charge-offs | $— | $— | $31 | $— | $— | $— | $— | $— | $31 |
| Multi-family residential: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $48713 | $11645 | $136014 | $366468 | $169627 | $17180 | $— | $13 | $749660 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  |  | 558 |  |  |  |  |  | 558 |
| Total multi-family residential | $48713 | $11645 | $136572 | $366468 | $169627 | $17180 | $— | $13 | $750218 |
| Multifamily gross charge-offs | $— | $— | $— | $— | $— | $198 | $— | $— | $198 |
| OOCRE: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $100969 | $106561 | $168061 | $96427 | $73502 | $173131 | $5554 | $11681 | $735886 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention |  | 461 | 4313 | 967 | 953 | 6173 |  |  | 12867 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  | 5338 |  | 6567 | 4839 | 5140 |  |  | 21884 |
| &nbsp;&nbsp;&nbsp;&nbsp;PCD |  |  |  |  |  | 9366 |  |  | 9366 |
| Total OOCRE | $100969 | $112360 | $172374 | $103961 | $79294 | $193810 | $5554 | $11681 | $780003 |
| OOCRE gross charge-offs | $— | $— | $— | $— | $— | $120 | $— | $— | $120 |
| NOOCRE: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $238165 | $59546 | $615542 | $517432 | $181026 | $536196 | $54323 | $9620 | $2211850 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention |  | 12330 | 8569 | 24523 | 11397 | 20607 |  |  | 77426 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  |  | 55714 | 3715 | 303 | 33139 |  |  | 92871 |
| &nbsp;&nbsp;&nbsp;&nbsp;PCD |  |  |  |  |  | 352 |  |  | 352 |
| Total NOOCRE | $238165 | $71876 | $679825 | $545670 | $192726 | $590294 | $54323 | $9620 | $2382499 |
| NOOCRE gross charge-offs | $— | $— | $3790 | $— | $1323 | $6262 | $— | $— | $11375 |
| Commercial: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $533306 | $259973 | $282571 | $56431 | $11124 | $58869 | $1389257 | $3155 | $2594686 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention | 7894 | 184 |  | 316 | 56 | 159 | 26586 | 176 | 35371 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard | 1087 | 4285 | 25025 |  | 469 | 13068 | 19244 |  | 63178 |
| &nbsp;&nbsp;&nbsp;&nbsp;PCD |  |  |  |  |  | 303 |  |  | 303 |

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

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| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| Total commercial | $542287 | $264442 | $307596 | $56747 | $11649 | $72399 | $1435087 | $3331 | $2693538 |
| Commercial gross charge-offs | $— | $217 | $4943 | $2285 | $— | $5947 | $— | $— | $13392 |
| MW: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $— | $— | $— | $— | $— | $— | $605411 | $— | $605411 |
| Total MW | $— | $— | $— | $— | $— | $— | $605411 | $— | $605411 |
| MW gross charge-offs | $— | $— | $— | $— | $— | $— | $— | $— | $— |
| Consumer: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pass | $2365 | $2058 | $613 | $202 | $368 | $1300 | $2069 | $— | $8975 |
| &nbsp;&nbsp;&nbsp;&nbsp;Special mention |  |  |  |  |  | 74 |  |  | 74 |
| &nbsp;&nbsp;&nbsp;&nbsp;Substandard |  |  |  |  | 3 | 55 |  |  | 58 |
| &nbsp;&nbsp;&nbsp;&nbsp;PCD |  |  |  |  |  | 8 |  |  | 8 |
| Total consumer | $2365 | $2058 | $613 | $202 | $371 | $1437 | $2069 | $— | $9115 |
| Consumer gross charge-offs | $420 | $— | $— | $— | $— | $155 | $— | $— | $575 |
| Total Pass | $1161589 | $574005 | $2137011 | $1483475 | $535341 | $909912 | $2304446 | $29523 | $9135302 |
| Total Special Mention | 7894 | 15676 | 37751 | 25806 | 12406 | 27078 | 26586 | 176 | 153373 |
| Total Substandard | 1087 | 34921 | 87772 | 12209 | 5695 | 52334 | 19760 |  | 213778 |
| Total PCD |  |  |  |  |  | 11073 |  |  | 11073 |
| Total | $1170570 | $624602 | $2262534 | $1521490 | $553442 | $1000397 | $2350792 | $29699 | $9513526 |
| Current year gross charge-offs | $420 | $217 | $8764 | $2285 | $1323 | $12682 | $— | $— | $25691 |

---

<sup>(1)</sup> Term loans amortized cost basis by origination year excludes $8,982 of deferred loan fees, net.

*Servicing Assets*

The Company was servicing loans of approximately $565,389 and $592,316 as of June 30, 2025 and 2024, respectively. A summary of the changes in the related servicing assets are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Six Months Ended June 30,** | **Six Months Ended June 30,** |
| *(Dollars in thousands)* | **2025** | **2024** | **2025** | **2024** |
| Balance at beginning of period | $11668 | $12622 | $9921 | $13258 |
| &nbsp;&nbsp;Increase from loan sales | 562 | 272 | 3220 | 907 |
| &nbsp;&nbsp;Servicing asset impairment, net recoveries | (184) | 57 | (44) | 279 |
| &nbsp;&nbsp;Amortization charged as a reduction to income | (908) | (753) | (1959) | (2246) |
| Balance at end of period | $11138 | $12198 | $11138 | $12198 |

---

Fair value of servicing assets is estimated by discounting estimated future cash flows from the servicing assets using discount rates that approximate current market rates over the expected lives of the loans being serviced. A valuation allowance is recorded when the fair value is below the carrying amount of the asset. As of June 30, 2025 and 2024 there was a valuation allowance of $1,247 and $1,253, respectively.

The following table reflects principal sold and related gain for SBA and USDA LHI. The gain on sale of these loans is recorded in government guaranteed loan income, net, in the Company's consolidated statements of income.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Six Months Ended June 30,** | **Six Months Ended June 30,** |
| *(Dollars in thousands)* | **2025** | **2024** | **2025** | **2024** |
| SBA LHI principal sold | $1615 | $1742 | $11992 | $14975 |
| Gain on sale of SBA LHI | 110 | 168 | 967 | 1344 |
| USDA LHI principal sold |  | 2850 | 9864 | 2850 |
| Gain on sale of USDA LHI |  | 52 | 1200 | 52 |

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

*LHFS*

The following table reflects LHFS as of June 30, 2025 and December 31, 2024.

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| | | |
|:---|:---|:---|
| *(Dollars in thousands)* | **June 30, 2025** | **December 31, 2024** |
| SBA/USDA construction and land | $21933 | $21629 |
| 1 - 4 family residential | 682 | 905 |
| SBA/USDA OOCRE | 23750 | 36437 |
| SBA NOOCRE | 1493 | 5028 |
| SBA/USDA commercial | 21622 | 25310 |
| Total LHFS | $69480 | $89309 |

---

**6. Borrowings**

*Advances from the FHLB*

Advances from the FHLB totaled $169,000 at June 30, 2025. There were no outstanding FHLB advances as of December 31, 2024. At June 30, 2025, outstanding advances, which were collateralized by a blanket lien on certain debt securities and loans, had a weighted average rate of 4.75% and a maturity date of July 1, 2025.

*Subordinated Debentures and Subordinated Notes*

Subordinated debentures and subordinated notes as of June 30, 2025 and December 31, 2024 were as follows:

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| | | |
|:---|:---|:---|
| *(Dollars in thousands)* | **June 30, 2025** | **December 31, 2024** |
| Subordinated notes, net of debt issuance costs | $124843 | $199607 |
| Subordinated debentures, net of discount | 31239 | 31129 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total subordinated notes and debentures | $156082 | $230736 |

---

In first quarter 2025, the Company redeemed $75,000 of its 4.75% fixed-to-floating subordinated notes, including accrued interest of $1,526. The notes were redeemable in whole or in part on any interest payment date that occurred after November 15, 2024, subject to the Federal Reserve Bank's approval in compliance with applicable statutes and regulations.

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**7. Fair Value**

The following table summarizes assets measured at fair value on a recurring basis as of June 30, 2025 and December 31, 2024, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
| *(Dollars in thousands)* | **Level 1<br>Inputs** | **Level 2<br>Inputs** | **Level 3<br>Inputs** | **Total<br>Fair Value** |
| **Financial Assets:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;AFS debt securities | $— | $1242285 | $— | $1242285 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equity securities with a readily determinable fair value | 9980 |  |  | 9980 |
| &nbsp;&nbsp;&nbsp;&nbsp;LHFS<sup>(1)</sup> |  | 68798 |  | 68798 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest rate derivatives designated as hedging instruments |  | 9735 |  | 9735 |
| &nbsp;&nbsp;&nbsp;&nbsp;Correspondent interest rate derivatives not designated as hedging instruments |  | 13006 |  | 13006 |
| &nbsp;&nbsp;&nbsp;&nbsp;Customer interest rate derivatives not designated as hedging instruments |  | 6652 |  | 6652 |
| **Financial Liabilities:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest rate derivatives designated as hedging instruments | $— | $30196 | $— | $30196 |
| &nbsp;&nbsp;&nbsp;&nbsp;Correspondent interest rate derivatives not designated as hedging instruments |  | 7079 |  | 7079 |
| &nbsp;&nbsp;&nbsp;&nbsp;Customer interest rate derivatives not designated as hedging instruments |  | 12383 |  | 12383 |

---

<sup>(1)</sup> Represents LHFS elected to be carried at fair value upon origination or acquisition.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| *(Dollars in thousands)* | **Level 1<br>Inputs** | **Level 2<br>Inputs** | **Level 3<br>Inputs** | **Total<br>Fair Value** |
| **Financial Assets:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp; AFS debt securities | $— | $1294512 | $— | $1294512 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equity securities with a readily determinable fair value | 9781 |  |  | 9781 |
| &nbsp;&nbsp;&nbsp;&nbsp;LHFS<sup>(1)</sup> |  | 88405 |  | 88405 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest rate derivatives designated as hedging instruments |  | 7786 |  | 7786 |
| &nbsp;&nbsp;&nbsp;&nbsp;Correspondent interest rate derivatives not designated as hedging instruments |  | 25328 |  | 25328 |
| &nbsp;&nbsp;&nbsp;&nbsp;Customer interest rate derivatives not designated as hedging instruments |  | 1514 |  | 1514 |
| **Financial Liabilities:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest rate derivatives designated as hedging instruments | $— | $41893 | $— | $41893 |
| &nbsp;&nbsp;&nbsp;&nbsp;Correspondent interest rate derivatives not designated as hedging instruments |  | 1651 |  | 1651 |
| &nbsp;&nbsp;&nbsp;&nbsp;Customer interest rate derivatives not designated as hedging instruments |  | 24817 |  | 24817 |

---

<sup>(1)</sup> Represents LHFS elected to be carried at fair value upon origination or acquisition.

There were no transfers between Level 2 and Level 3 during the six months ended June 30, 2025 and the year ended December 31, 2024.

Certain assets, including collateral dependent loans with an ACL, servicing assets with a valuation allowance and OREO are measured at fair value on a non-recurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment).

*Collateral Dependent Loans with an ACL*: A loan is considered collateral-dependent when the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the operation or sale of the collateral. The

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ACL is measured by estimating the fair value of the loan's underlying collateral. For real estate loans, fair value of the loan's collateral is determined by third-party appraisals, which are then adjusted for the estimated selling and closing costs related to liquidation of the collateral. Appraisals for collateral dependent loans with an ACL are performed by certified general appraisers whose qualifications and licenses have been reviewed and verified by the Company. Once reviewed, a member of the credit department reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparisons to independent data sources such as recent market data or industry-wide statistics. On a periodic basis, the Company compares the actual selling price of collateral that has been sold to the most recent appraised value to determine what additional adjustments, if any, should be made to the appraisal value to arrive at fair value.

*Servicing Assets with a Valuation Allowance:* The fair value of the servicing asset is estimated using discounted cash flows based on current market interest rates. A valuation allowance is recorded when the fair value is below the carrying amount of the asset.

*OREO*: OREO is measured at fair value on a nonrecurring basis (upon initial recognition or subsequent impairment). When transferred from the loan portfolio, OREO is adjusted to fair value less estimated selling costs. The fair value is determined using an external appraisal process, discounted based on internal criteria to consider selling and closing costs.

The following table summarizes assets measured at fair value on a non-recurring basis as of June 30, 2025 and December 31, 2024, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:

---

| | |
|:---|:---|
| | **Fair Value<br>Measurements Using** |
| *(Dollars in thousands)* | **Level 3<br>Inputs** |
| As of June 30, 2025 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Assets: |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Collateral dependent loans with an ACL | $1531 |
| &nbsp;&nbsp;&nbsp;&nbsp;Servicing assets with a valuation allowance | 3675 |
| &nbsp;&nbsp;&nbsp;&nbsp;OREO | 9218 |
| As of December 31, 2024 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Assets: |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Collateral dependent loans with an ACL | $4182 |
| &nbsp;&nbsp;&nbsp;&nbsp;Servicing assets with a valuation allowance | 3356 |
| &nbsp;&nbsp;&nbsp;&nbsp;OREO | 24737 |

---

At June 30, 2025, collateral dependent loans with an allowance had a recorded investment of $1,933, with $402 specific ACL allocated. At December 31, 2024, collateral dependent loans with an allowance had a carrying value of $4,798, with $616 of specific ACL allocated.

At June 30, 2025, servicing assets of $4,922 had a valuation allowance totaling $1,247. At December 31, 2024, servicing assets of $4,560 had a valuation allowance totaling $1,204.

OREO primarily consists of two properties recorded with a fair value of approximately $9,218 in total at June 30, 2025. There were four OREO properties recorded with a fair value of approximately $24,737 in total as of December 31, 2024.

There were no liabilities measured at fair value on a non-recurring basis as of June 30, 2025 or December 31, 2024.

<u>Fair Value of Financial Instruments</u>

The Company's methods of determining fair value of financial instruments in this Note are consistent with its methodologies disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2024. Please refer to Note 16 in the Company's Annual Report on Form 10-K for information on these methods.

The estimated fair values and carrying values of all financial instruments not measured at fair value on a recurring basis under current authoritative guidance as of June 30, 2025 and December 31, 2024 were as follows:

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---

| | | | | |
|:---|:---|:---|:---|:---|
| | | **Fair Value** | **Fair Value** | **Fair Value** |
| *(Dollars in thousands)* | **Carrying<br>Amount** | **Level 1** | **Level 2** | **Level 3** |
| **June 30, 2025** |  |  |  |  |
| &nbsp;&nbsp;**Financial assets:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $770565 | $— | $770565 | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;HTM debt securities | 176519 |  | 152319 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;LHFS<sup>(1)</sup> | 682 |  | 682 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;LHI<sup>(2) (3)</sup> | 9338845 |  |  | 9279057 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest receivable | 44428 |  | 44428 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BOLI | 86048 |  | 86048 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Servicing asset | 7463 |  |  | 10094 |
| &nbsp;&nbsp;**Financial liabilities:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Noninterest-bearing deposits | $2133294 | $— | $2133294 | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing deposits | 8284626 |  | 8086787 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Advances from FHLB | 169000 |  | 169000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest payable | 21750 |  | 21750 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subordinated debentures and subordinated notes | 156082 |  | 157268 |  |
| **December 31, 2024** |  |  |  |  |
| &nbsp;&nbsp;**Financial assets:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $855200 | $— | $855200 | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;HTM debt securities | 184026 |  | 160560 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;LHFS<sup>(1)</sup> | 904 |  | 904 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;LHI<sup>(2)</sup> | 9499746 |  |  | 9409813 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest receivable | 46328 |  | 46328 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BOLI | 85324 |  | 85324 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Servicing asset | 6565 |  | 6565 |  |
| &nbsp;&nbsp;**Financial liabilities:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Noninterest-bearing deposits | $2191457 | $— | $2191457 | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing deposits | 8561135 |  | 8349988 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest payable | 38568 |  | 38568 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subordinated debentures and subordinated notes | 230736 |  | 230736 |  |

---

<sup>(1)</sup> LHFS represent mortgage LHFS that are carried at lower of cost or market.

<sup>(2)</sup> LHI includes MW and is carried at amortized cost.

<sup>(3)</sup> Presented net of ACL.

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**8. Derivative Financial Instruments**

The Company uses derivatives to manage exposure to market risk, primarily interest rate risk, and to assist customers with their risk management objectives (customer-related derivatives). Management typically designates its risk management derivatives as hedging instruments in a qualifying hedge accounting relationship, while derivatives not designated as qualifying hedges primarily consist of customer-related derivatives.

***Cash Flow Hedges***

We enter into cash flow hedge relationships to mitigate exposure to the variability of future cash flows from interest rate risk. The Company uses interest rate swaps, floors, caps and collars to manage cash flow changes from the exposure to benchmark interest rates. To qualify for hedge accounting, a formal assessment is prepared to determine whether the hedging relationship, both at inception and on an ongoing basis, is expected to be highly effective in offsetting cash flows attributable to the hedged risk during the term of the cash flow hedge. At inception, a statistical regression analysis is prepared to determine hedge effectiveness. At each reporting period thereafter, a statistical regression or qualitative analysis is performed. Cash flow hedges are recorded at fair value in other assets and accounts payable and other liabilities on the consolidated balance sheets with changes in fair value recorded in AOCI, net of tax. Amounts recorded to AOCI are reclassified into earnings in the same period in which the hedged asset or liability affects earnings through periodic settlements and are presented in the same income statement line item as the earnings effect of the hedged asset or liability.&nbsp;&nbsp;&nbsp;&nbsp;

***Interest Rate Swap, Floor, Cap and Collar Agreements Not Designated as Hedging Derivatives***

In order to accommodate the borrowing needs of certain commercial customers, the Company has entered into interest rate agreements with those customers. These interest rate derivative contracts effectively allow the Company's customers to convert a variable rate loan into a fixed rate loan. In order to offset the exposure and manage interest rate risk, at the time an agreement is entered into with a customer, the Company enters into an interest rate contract with offsetting terms with a correspondent bank counterparty. These derivative instruments are not designated as accounting hedges and changes in the net fair value are recognized in noninterest income. Because the Company acts as an intermediary for its customers, changes in the fair value of the derivative contracts substantially offset each other and do not have a material impact on the Company's results of operations. The fair value of derivative positions outstanding is included in other assets and accounts payable and other liabilities on the accompanying consolidated balance sheets and in the net change in each of these financial statement line items in the accompanying consolidated statements of cash flows.

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The notional amounts and estimated fair values as of June 30, 2025 and December 31, 2024 are as shown in the table below.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| | | **Estimated Fair Value** | **Estimated Fair Value** | | **Estimated Fair Value** | **Estimated Fair Value** |
| *(Dollars in thousands)* | **Notional<br>Amount** | **Asset Derivative** | **Liability Derivative** | **Notional<br>Amount** | **Asset Derivative** | **Liability Derivative** |
| Derivatives designated as hedging instruments (cash flow hedges): |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest rate swap on money market deposit account payments | $— | $— | $— | $250000 | $2361 | $— |
| &nbsp;&nbsp;&nbsp;Interest rate swaps on variable rate funding sources | 275000 | 114 | 2334 | 275000 | 201 | 1821 |
| &nbsp;&nbsp;&nbsp;Interest rate swaps on customer loan interest payments | 375000 |  | 27689 | 375000 |  | 39517 |
| &nbsp;&nbsp;&nbsp;Interest rate collars on customer loan interest payments | 700000 | 8068 | 173 | 700000 | 3780 | 555 |
| &nbsp;&nbsp;&nbsp;Interest rate floor on customer loan interest payments | 200000 | 1553 |  | 200000 | 1444 |  |
| Total derivatives designated as hedging instruments | $1550000 | $9735 | $30196 | $1800000 | $7786 | $41893 |
| Derivatives not designated as hedging instruments: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Financial institution counterparty: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest rate swaps | $861988 | $13006 | $6523 | $857625 | $25328 | $1651 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest rate caps and collars | 43070 |  | 556 | 4000 |  |  |
| &nbsp;&nbsp;&nbsp;Commercial customer counterparty: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest rate swaps | 861988 | 6134 | 12383 | 857625 | 1514 | 24817 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest rate caps and collars | 43070 | 518 |  | 4000 |  |  |
| &nbsp;&nbsp;&nbsp;Total derivatives not designated as hedging instruments | $1810116 | $19658 | $19462 | $1723250 | $26842 | $26468 |
| &nbsp;&nbsp;&nbsp;Offsetting derivative assets/liabilities |  | (22579) | (22579) |  | (28239) | (28239) |
| &nbsp;&nbsp;&nbsp;Total derivatives | $3360116 | $6814 | $27079 | $3523250 | $6389 | $40122 |

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Pre-tax (loss) gain included in the consolidated statements of income and related to derivative instruments for the three and six months ended June 30, 2025 and 2024 were as follows.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **For the Three Months Ended June 30, 2025** | **For the Three Months Ended June 30, 2025** | **For the Three Months Ended June 30, 2025** | **For the Three Months Ended June 30, 2024** | **For the Three Months Ended June 30, 2024** | **For the Three Months Ended June 30, 2024** |
| *(Dollars in thousands)* | **(Loss) gain recognized in other comprehensive income on derivative** | **Gain (loss) reclassified from AOCI into income** | **Location of (loss) gain reclassified from AOCI into income** | **Gain (loss) recognized in other comprehensive income on derivative** | **Gain (loss) reclassified from AOCI into income** | **Location of (loss) gain reclassified from AOCI into income** |
| Derivatives designated as hedging instruments (cash flow hedges): |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest rate swap on borrowing advances | $(1093) | $1093 | Interest Expense | $(1094) | $1094 | Interest Expense |
| &nbsp;&nbsp;&nbsp;Interest rate swaps on variable rate funding sources | 74 | (5) | Interest Expense | (1835) | 3517 | Interest Expense |
| &nbsp;&nbsp;&nbsp;Interest rate swaps, collars and floors on customer loan interest payments | 7584 | (4160) | Interest Income | 701 | (5499) | Interest Income |
| Total | $6565 | $(3072) |  | $(2228) | $(888) |  |
|  |  |  | **Net gain recognized in other noninterest income** |  |  | **Net gain recognized in other noninterest income** |
| Derivatives not designated as hedging instruments: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest rate swaps, caps and collars |  |  | $1550 |  |  | $326 |

---

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **For the Six Months Ended June 30, 2025** | **For the Six Months Ended June 30, 2025** | **For the Six Months Ended June 30, 2025** | **For the Six Months Ended June 30, 2024** | **For the Six Months Ended June 30, 2024** | **For the Six Months Ended June 30, 2024** |
| *(Dollars in thousands)* | **(Loss) gain recognized in other comprehensive income on derivative** | **Gain (loss) reclassified from AOCI into income** | **Location of (loss) gain reclassified from AOCI into income** | **Gain (loss) recognized in other comprehensive income on derivative** | **Gain (loss) reclassified from AOCI into income** | **Location of (loss) gain reclassified from AOCI into income** |
| Derivatives designated as hedging instruments (cash flow hedges): |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest rate swap on borrowing advances | $(2175) | $2175 | Interest Expense | $(2187) | $2187 | Interest Expense |
| &nbsp;&nbsp;&nbsp;Interest rate swaps on variable rate funding sources | (2961) | 2397 | Interest Expense | 14 | 6956 | Interest Expense |
| &nbsp;&nbsp;&nbsp;Interest rate swaps, collars and floors on customer loan interest payments | 18417 | (8180) | Interest Income | (8550) | (10867) | Interest Income |
| Total | $13281 | $(3608) |  | $(10723) | $(1724) |  |
|  |  |  | **Net gain recognized in other noninterest income** |  |  | **Net gain recognized in other noninterest income** |
| Derivatives not designated as hedging instruments: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest rate swaps, caps and collars |  |  | $2250 |  |  | $775 |

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**9. OBS Loan Commitments**

The Company is party to financial instruments with OBS risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and MW commitments, as well as standby and commercial letters of credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated balance sheets.

The Company's exposure to credit loss in the event of nonperformance by the other party to a financial instrument for commitments to extend credit, MW commitments and standby and commercial letters of credit is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments.

The following table sets forth the approximate amounts of these financial instruments as of June 30, 2025 and December 31, 2024:

---

| | | |
|:---|:---|:---|
| | **June 30,** | **December 31,** |
| *(Dollars in thousands)* | **2025** | **2024** |
| Commitments to extend credit | $3677573 | $3115682 |
| MW commitments | 650948 | 562589 |
| Standby and commercial letters of credit | 112686 | 111930 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total | $4441207 | $3790201 |

---

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments may expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Management evaluates each customer's creditworthiness on a case-by-case basis and substantially all of the Company's commitments to extend credit are contingent upon customers maintaining specific credit standards at the time of future loan funding. The amount of collateral obtained, if deemed necessary upon extension of credit, is based on management's credit evaluation of the borrower.

MW commitments are unconditionally cancellable and represent the unused capacity on MW facilities the Company has approved. The Company reserves the right to refuse to buy any mortgage loans offered for sale by a customer, for any reason, at the Company's sole and absolute discretion.

Standby and commercial letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. Standby and commercial letters of credit generally have fixed expiration dates or other termination clauses and may require payment of a fee. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Company's policy for obtaining collateral and the nature of such collateral is substantially the same as that involved in making commitments to extend credit.

The table below presents the activity in the allowance for unfunded commitment credit losses related to those financial instruments discussed above. This ACL on unfunded commitments is recorded in accounts payable and other liabilities on the consolidated balance sheets:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Six Months Ended June 30,** | **Six Months Ended June 30,** |
| *(Dollars in thousands)* | **2025** | **2024** | **2025** | **2024** |
| Beginning balance for ACL on unfunded commitments | $7403 | $6504 | $6103 | $8045 |
| Provision (benefit) for credit losses on unfunded commitments | 1500 |  | 2800 | (1541) |
| Ending balance of ACL on unfunded commitments | $8903 | $6504 | $8903 | $6504 |

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**10. Income Taxes**

Income tax expense for the three and six months ended June 30, 2025 and 2024 was as follows:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Six Months Ended June 30,** | **Six Months Ended June 30,** |
| *(Dollars in thousands)* | **2025** | **2024** | **2025** | **2024** |
| Income tax expense for the period | $8516 | $8221 | $17042 | $15458 |
| Effective tax rate | 21.6% | 23.2% | 22.1% | 23.1% |

---

The effective income tax rates for the comparable periods differed from the U.S. statutory federal income tax rates of 21% primarily due to the effects of tax-exempt income from certain investment securities and bank owned life insurance policies, as well as nondeductible compensation, state income taxes and changes in valuation allowances recorded.

**11. Legal Contingencies**

<u>Litigation</u>

The Company may from time to time be involved in legal actions arising from normal business activities. In the opinion of management, there are no claims for which it is reasonably possible that an adverse outcome would have a material effect on the Company's financial position, liquidity or results of operations. The Company is not aware of any material unasserted claims.

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**12. Capital Requirements and Restrictions on Retained Earnings**

Under applicable U.S. banking laws, there are legal restrictions limiting the amount of dividends the Company can declare. Approval of the regulatory authorities is required if, among other things, the effect of the dividends declared would cause regulatory capital of the Company to fall below specified minimum levels.

The Company on a consolidated basis and the Bank are subject to various regulatory capital requirements administered by federal banking agencies. Failure to meet minimum capital requirements triggers certain mandatory actions and may lead to additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company's financial statements. Under capital adequacy guidelines and the regulatory framework for PCA, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank's assets, liabilities, and certain OBS items as calculated under regulatory accounting practices. The Bank's capital amounts and PCA classification are also subject to qualitative judgments by the regulators about components of capital, risk weightings of assets, and other factors. In addition, an institution may be downgraded to, or deemed to be in, a capital category that is lower than indicated by its capital ratios, if it is determined to be in an unsafe or unsound condition or if it receives an unsatisfactory examination rating with respect to certain matters.

We are subject to various quantitative measures established by regulation to ensure capital adequacy. These generally applicable capital requirements require a banking organization to maintain minimum amounts and ratios (set forth in the table below) of total capital, Tier 1 capital, and CET1 capital to RWA, and of Tier 1 capital to average adjusted assets. The capital rules implementing Basel III also include a "capital conservation buffer" of 2.5% on top of each of the minimum RBC ratios, and a banking organization with any RBC ratio that meets or exceeds the minimum requirement but does not meet the capital conservation buffer will face constraints on dividends, equity repurchases and discretionary bonus payments based on the amount of the shortfall. Additionally, to be categorized as "well capitalized," a bank is required to maintain minimum total risk-based CET1, Tier 1, and total capital ratios and Tier 1 leverage ratios as set forth in the table below.

As of June 30, 2025 and December 31, 2024, the Company's and the Bank's capital ratios exceeded those levels necessary to be categorized as "well capitalized". There are no conditions or events since June 30, 2025 that management believes have changed the Company's category.

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A comparison of the Company's and Bank's actual capital amounts and ratios to required capital amounts and ratios as of June 30, 2025 and December 31, 2024 is presented in the following table:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Actual** | **Actual** | **For Capital <br>Adequacy Purposes** | **To Be Well<br>Capitalized Under<br>PCA Provisions** |
| *(Dollars in thousands)* | **Amount** | **Ratio** | **Ratio** <sup>(1)</sup> | **Ratio** |
| <u>As of June 30, 2025</u> |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total capital (to RWA) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Company | $1539632 | 13.46% | 8.0% | 10.0% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank | 1462950 | 12.84 | 8.0 | 10.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;Tier 1 capital (to RWA) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Company | 1294270 | 11.31 | 6.0 | 6.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank | 1342431 | 11.78 | 6.0 | 8.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;CET1 (to RWA) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Company | 1264049 | 11.05 | 4.5 | n/a |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank | 1342431 | 11.78 | 4.5 | 6.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;Tier 1 leverage ratio <sup>(2)</sup> |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Company | 1294270 | 10.73 | 4.0 | n/a |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank | 1342431 | 11.17 | 4.0 | 5.0 |
| <u>As of December 31, 2024</u> |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total capital (to RWA) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Company | $1571001 | 13.96% | 8.0% | 10.0% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank | 1510901 | 13.49 | 8.0 | 10.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;Tier 1 capital (to RWA) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Company | 1277955 | 11.36 | 6.0 | 6.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank | 1402462 | 12.52 | 6.0 | 8.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;CET1 (to RWA) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Company | 1247844 | 11.09 | 4.5 | n/a |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank | 1402462 | 12.52 | 4.5 | 6.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;Tier 1 leverage ratio <sup>(2)</sup> |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Company | 1277955 | 10.32 | 4.0 | n/a |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank | 1402462 | 11.37 | 4.0 | 5.0 |
| <sup>(1)</sup> Requirement prior to capital conservation buffer |  |  |  |  |
| <sup>(2)</sup> The Tier 1 leverage ratio consists of Tier 1 capital divided by total quarterly average assets, excluding goodwill and other permitted Tier 1 capital deductions.  | <sup>(2)</sup> The Tier 1 leverage ratio consists of Tier 1 capital divided by total quarterly average assets, excluding goodwill and other permitted Tier 1 capital deductions.  | <sup>(2)</sup> The Tier 1 leverage ratio consists of Tier 1 capital divided by total quarterly average assets, excluding goodwill and other permitted Tier 1 capital deductions.  | <sup>(2)</sup> The Tier 1 leverage ratio consists of Tier 1 capital divided by total quarterly average assets, excluding goodwill and other permitted Tier 1 capital deductions.  | <sup>(2)</sup> The Tier 1 leverage ratio consists of Tier 1 capital divided by total quarterly average assets, excluding goodwill and other permitted Tier 1 capital deductions.  |

---

&nbsp;&nbsp;&nbsp;&nbsp;

*Dividend Restrictions*

Dividends paid by the Bank are subject to certain restrictions imposed by regulatory agencies. Capital requirements further limit the amount of dividends that may be paid by the Bank. Dividends of $27,000 and $124,000 were paid by the Bank to the Holdco during the three and six months ending June 30, 2025. Dividends of $50,000 and $77,500 were paid by the Bank to the Holdco during the three and six months ending June 30, 2024.

Dividends of $11,935, or $0.22 per outstanding share and $22,864, or $0.44 per outstanding share were paid by the Company during the three and six months ended June 30, 2025, respectively. Dividends of $10,900, or $0.20 per outstanding share and $21,799, or $0.40 per outstanding share were paid by the Company during the three and six months ended June 30, 2024, respectively.

The Bank is subject to limitations on dividend payouts if, among other things, it does not have a capital conservation buffer of 2.5% or more. The Bank had a capital conservation buffer of 4.84% as of June 30, 2025.

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**13. Subsequent Event**

**Merger with Huntington Bancshares Incorporated (Huntington)**

On July 14, 2025, the Company and Huntington jointly announced the signing of a definitive merger agreement, dated July 13, 2025, under which Huntington will acquire the Company in an all-stock transaction by means of merger, with Huntington continuing as the surviving corporation. Huntington is a regional bank headquartered in Columbus, Ohio and operates over 900 branches in 13 states. Under the terms of the agreement, the Company will merge into Huntington and, immediately after the merger, the Bank will merge into Huntington National Bank.

At the effective time of the merger, the Company's shareholders will receive 1.95 shares of Huntington's common stock for each share of Company common stock based on a fixed exchange ratio.

The merger agreement was unanimously approved by both the Company's and Huntington's Boards of Directors and is anticipated to close in fourth quarter of 2025. The transaction is subject to receipt of regulatory approvals and satisfaction of other customary closing conditions, including the requisite approval of the stockholders of the Company. The Company has not incurred significant expenses related to the merger.

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**Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations**

*The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and notes thereto appearing in Item 1 of Part I of this Quarterly Report on Form 10-Q (this "Report") as well as with our consolidated financial statements and notes thereto appearing in our Annual Report on Form 10-K for the year ended December 31, 2024. Except where the content otherwise requires or when otherwise indicated, the terms "Veritex," the "Company," "we," "us," "our," and "our business" refer to the combined entities of Veritex Holdings, Inc. and its subsidiaries, including Veritex Community Bank.* 

*This discussion and analysis contains forward-looking statements that are subject to certain risks and uncertainties and are based on certain assumptions that we believe are reasonable but may prove to be inaccurate. Certain risks, uncertainties and other factors, including those set forth under "Special Cautionary Notice Regarding Forward-Looking Statements," may cause actual results to differ materially from the projected results discussed in the forward-looking statements appearing in this discussion and analysis. We assume no obligation to update any of these forward-looking statements. For additional information concerning forward-looking statements, please read "Special Cautionary Notice Regarding Forward-Looking Statements" below.*

**Overview**

We are a Texas state banking organization with corporate offices in Dallas, Texas. Through our wholly owned subsidiary, Veritex Community Bank, a Texas state-chartered bank, we provide relationship-driven commercial banking products and services tailored to meet the needs of small to medium-sized businesses and professionals. Beginning at our operational inception in 2010, we initially targeted customers and focused our acquisitions primarily in the Dallas metropolitan area, which we consider to be Dallas and the adjacent communities in North Dallas. Our current primary markets include the broader DFW metroplex and the Houston metropolitan area.

Our business is conducted through one reportable segment, community banking, which generates the majority of our revenues from interest income on loans, customer service and loan fees, gains on sale of government guaranteed loans and mortgage loans and interest income from securities. We incur interest expense on deposits and other borrowed funds and noninterest expense, such as salaries, employee benefits and occupancy expenses. We analyze our ability to maximize income generated from interest earning assets and expense of our liabilities through net interest margin. Net interest margin is a ratio calculated as net interest income divided by average interest-earning assets. Net interest income is the difference between interest income on interest-earning assets, such as loans and securities, and interest expense on interest-bearing liabilities, such as deposits and borrowings, which are used to fund those assets.

Changes in the market interest rates and interest rates we earn on interest-earning assets or pay on interest-bearing liabilities, as well as the volume and types of interest-earning assets, and interest-bearing and noninterest-bearing liabilities, are usually the largest drivers of periodic changes in net interest spread, net interest margin and net interest income. Fluctuations in market interest rates are driven by many factors, including governmental monetary policies, inflation, deflation, macroeconomic developments, changes in unemployment, the money supply, political and international conditions and conditions in domestic and foreign financial markets. Periodic changes in the volume and types of loans in our loan portfolio are affected by, among other factors, economic and competitive conditions in Texas and, specifically, in the DFW metroplex and Houston metropolitan area, as well as developments affecting the real estate, technology, financial services, insurance, transportation, manufacturing and energy sectors within our target markets and throughout the state of Texas.

**Recent Development**

**Merger with Huntington** 

As described in Note 13 - "[Subsequent Event](#i99d8b0fb842e4018a10d7d1e55bdf145_1510)" in the Company's consolidated financial statements included elsewhere in this report, the Company and Huntington have entered into a definitive merger agreement, dated July 13, 2025, under which Huntington will acquire the Company in an all-stock transaction, with Huntington continuing as the surviving entity. The Company's shareholders will receive 1.95 shares of Huntington's common stock for each share of Company common stock under the terms of the agreement. The merger agreement has been approved by both the Company's and Huntington's Boards of Directors and is anticipated to close in fourth quarter of 2025, subject to regulatory approvals and other customary closing conditions, including the requisite approval of the stockholders of the Company.

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See also the updated "<u>[Risk Factors](#i99d8b0fb842e4018a10d7d1e55bdf145_166)</u>" section disclosed in Part II, Item 1A of this quarterly report on Form 10-Q.

**Results of Operations**

The Company is providing a comparison of the quarter ended June 30, 2025 against the preceding sequential quarter, which it believes provides more relevant information for investors and stakeholders to understand and analyze the business. The Company continues to present the required comparison of current year-to-date results with the same period of the prior year.

Financial information for the three months ended March 31, 2025, may be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part I, Item 2 of the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025.

**Results of Operations for the Three Months Ended June 30, 2025 and March 31, 2025**

*General*

Net income for the three months ended June 30, 2025 was $30.9 million, an increase of $1.8 million, or 6.3%, from net income of $29.1 million for the three months ended March 31, 2025.

Basic EPS for the three months ended June 30, 2025 was $0.57, an increase of $0.04 per share from $0.53 for the three months ended March 31, 2025. Diluted EPS for the three months ended June 30, 2025 was $0.56, an increase of $0.03 from $0.53 for the three months ended March 31, 2025.

*Net Interest Income*

For the three months ended June 30, 2025, net interest income totaled $96.3 million and net interest margin and net interest spread were 3.33% and 2.29%, respectively. For the three months ended March 31, 2025, net interest income totaled $95.4 million and net interest margin and net interest spread were 3.31% and 2.24%, respectively. The increase in net interest income was primarily due to a $2.8 million increase in interest income on loans, a $1.7 million decrease in interest expense on certificates and other time deposits and a $768 thousand decrease in subordinated debentures and subordinated notes, partially offset by a $2.9 million increase in interest expense on transaction and savings deposits and a $1.2 million decrease in interest income on deposits in financial institutions for the three months ended June 30, 2025 compared to the three months ended March 31, 2025. Net interest margin increased 2 bps to 3.33% from 3.31% for the three months ended June 30, 2025, compared to the three months ended March 31, 2025, primarily due to decreased funding costs on certificates of deposits, driven by the maturity of higher-rated deposits, and subordinated debt due the redemption of $75.0 million in borrowings during the three months ended March 31, 2025, as well as a shift in mix from lower yielding to higher yielding assets for the three months ended June 30, 2025. The increase was largely offset by higher deposits funding costs primarily driven by the expiration of favorable hedges on money market deposit accounts at the end of the first quarter 2025.

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The following table presents, for the periods indicated, an analysis of net interest income by each major category of interest-earning assets and interest-bearing liabilities, the average amounts outstanding and the interest earned or paid on such amounts. The table also sets forth the average yields earned on interest-earning assets, the average rates paid on interest-bearing liabilities, and the net interest margin on average total interest-earning assets for the same periods. Interest earned on loans that are classified as nonaccrual is not recognized in income; however, the balances are reflected in average outstanding balances for the period. For the three months ended June 30, 2025 and three months ended March 31, 2025, interest income not recognized on nonaccrual loans was $587 thousand and $985 thousand, respectively. Any nonaccrual loans have been included in the table as loans carrying a zero yield.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **For the Three Months Ended** | **For the Three Months Ended** | **For the Three Months Ended** | **For the Three Months Ended** | **For the Three Months Ended** | **For the Three Months Ended** |
| | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **March 31, 2025** | **March 31, 2025** | **March 31, 2025** |
| | | Interest | | | Interest | |
| | Average | Earned/ | Average | Average | Earned/ | Average |
| | Outstanding | Interest | Yield/ | Outstanding | Interest | Yield/ |
| *(Dollars in thousands)* | Balance | Paid | Rate<sup>(4)</sup> | Balance | Paid | Rate<sup>(4)</sup> |
| Assets |  |  |  |  |  |  |
| Interest-earning assets: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Loans<sup>(1)</sup> | $8875970 | $141688 | 6.40% | $8886905 | $140329 | 6.40% |
| &nbsp;&nbsp;&nbsp;&nbsp;LHI, MW | 523203 | 7666 | 5.88 | 426724 | 6176 | 5.87 |
| &nbsp;&nbsp;&nbsp;&nbsp;Debt Securities | 1440369 | 16883 | 4.70 | 1467220 | 17106 | 4.73 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-earning deposits in other banks | 707933 | 8039 | 4.55 | 827751 | 9244 | 4.53 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equity securities and other investments | 70779 | 847 | 4.80 | 70696 | 870 | 4.99 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total interest-earning assets | 11618254 | 175123 | 6.05 | 11679296 | 173725 | 6.03 |
| ACL | (112369) |  |  | (111563) |  |  |
| Noninterest-earning assets | 933328 |  |  | 938401 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total assets | $12439213 |  |  | $12506134 |  |  |
| Liabilities and Stockholders' Equity |  |  |  |  |  |  |
| Interest-bearing liabilities: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing demand and savings deposits | $5502672 | $48080 | 3.50% | $5449091 | $45165 | 3.36% |
| &nbsp;&nbsp;&nbsp;&nbsp;Certificates and other time deposits | 2742655 | 28539 | 4.17 | 2726309 | 30268 | 4.50 |
| &nbsp;&nbsp;&nbsp;&nbsp;Advances from FHLB and other | 9813 | 113 | 4.62 | 2333 | 27 | 4.69 |
| &nbsp;&nbsp;&nbsp;&nbsp;Subordinated debentures and subordinated debt | 155985 | 2056 | 5.29 | 191638 | 2824 | 5.98 |
| Total interest-bearing liabilities | 8411125 | 78788 | 3.76 | 8369371 | 78284 | 3.79 |
| Noninterest-bearing liabilities: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Noninterest-bearing deposits | 2244745 |  |  | 2345586 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Other liabilities | 142925 |  |  | 170389 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total liabilities | 10798795 |  |  | 10885346 |  |  |
| Stockholders' equity | 1640418 |  |  | 1620788 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and stockholders' equity | $12439213 |  |  | $12506134 |  |  |
| Net interest rate spread<sup>(2)</sup> |  |  | 2.29% |  |  | 2.24% |
| Net interest income |  | $96335 |  |  | $95441 |  |
| Net interest margin<sup>(3)</sup> |  |  | 3.33% |  |  | 3.31% |

---

<sup>(1)</sup> Includes average outstanding balances of LHFS of $62.2 million and $66.3 million for the three months ended June 30, 2025 and three months ended March 31, 2025, respectively, and average balances of LHI, excluding MW loans.

<sup>(2)</sup> Net interest rate spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.

<sup>(3)</sup> Net interest margin is equal to net interest income divided by average interest-earning assets.

<sup>(4)</sup> Yields and rates for the quarter are annualized.

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The following table presents the changes in interest income and interest expense for the periods indicated for each major component of interest-earning assets and interest-bearing liabilities and distinguishes between the changes attributable to changes in volume and interest rates. For purposes of this table, changes attributable to both rate and volume that cannot be segregated have been allocated to rate.

---

| | | | |
|:---|:---|:---|:---|
| | **For the Three Months Ended** | **For the Three Months Ended** | **For the Three Months Ended** |
| | **June 30, 2025 vs. March 31, 2025** | **June 30, 2025 vs. March 31, 2025** | **June 30, 2025 vs. March 31, 2025** |
| | **Increase (Decrease)** | **Increase (Decrease)** | |
| | **Due to Change in** | **Due to Change in** | |
| *(Dollars in thousands)* | **Volume** | **Rate** | **Total** |
| Interest-earning assets: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Loans | $(175) | $1534 | $1359 |
| &nbsp;&nbsp;&nbsp;&nbsp;LHI, MW | 1412 | 78 | 1490 |
| &nbsp;&nbsp;&nbsp;&nbsp;Debt Securities | (317) | 94 | (223) |
| &nbsp;&nbsp;&nbsp;&nbsp;Equity securities and other investments | (1353) | 148 | (1205) |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing deposits in other banks | 1 | (24) | (23) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total increase in interest income | $(431) | $1829 | $1398 |
| Interest-bearing liabilities: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing demand and savings deposits | $449 | $2466 | $2915 |
| &nbsp;&nbsp;&nbsp;&nbsp;Certificates and other time deposits | 183 | (1912) | (1729) |
| &nbsp;&nbsp;&nbsp;&nbsp;Advances from FHLB and other | 88 | (2) | 86 |
| &nbsp;&nbsp;&nbsp;&nbsp;Subordinated debentures and subordinated notes | (531) | (237) | (768) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total increase in interest expense | 189 | 315 | 504 |
| Increase in net interest income | $(620) | $1514 | $894 |

---

*Provision for Credit Losses*

Our provision for credit losses is a charge to income in order to bring our ACL to a level deemed appropriate by management. Provision expense for loans is generally reflective of changes in the loan portfolio, including production and credit quality, as well as net charge-offs or specific credit allocations taken during the respective period. Provision expense is also impacted by the economic outlook and changes in macroeconomic variables used in the calculation. We recorded a provision for credit loss expense on loans of $1.8 million for the three months ended June 30, 2025, compared to a $4.0 million provision for credit loss expense for the three months ended March 31, 2025. The provision recorded was primarily attributable to changes in economic factors during the period. We recorded $1.5 million provision for credit loss expense for unfunded commitments for the three months ended June 30, 2025, compared to $1.3 million for the three months ended March 31, 2025, as the balance of unfunded commitments increased quarter over quarter. The ACL to total loans ratio of 1.19% as of June 30, 2025 was unchanged from March 31, 2025.

Net charge-offs were $1.3 million for the three months ended June 30, 2025, a decrease of $2.7 million from $4.0 million for the three months ended March 31, 2025. The decrease was primarily due to a decrease in net charge-offs of NOOCRE loans.

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*Noninterest Income*

Our primary sources of recurring noninterest income are service charges and fees on deposit accounts, loan fees, net government guaranteed loan income, customer swap income, and other income. Noninterest income does not include loan origination fees, which are generally recognized over the life of the related loan as an adjustment to yield using the interest method.

The following table presents, for the periods indicated, the major categories of noninterest income:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the Three Months Ended** | **For the Three Months Ended** | **Increase (Decrease)** | **Increase (Decrease)** |
| *(Dollars in thousands)* | **June 30, 2025** | **March 31, 2025** | **$ change** | **% change** |
| Noninterest income: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Service charges and fees on deposit accounts | $5702 | $5611 | $91 | 1.6% |
| &nbsp;&nbsp;&nbsp;&nbsp;Loan fees | 2735 | 2495 | 240 | 9.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;Government guaranteed loan income, net | 1688 | 3301 | (1613) | (48.9) |
| &nbsp;&nbsp;&nbsp;&nbsp;Customer swap income | 1550 | 700 | 850 | 121.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other income | 1824 | 2182 | (358) | (16.4) |
| Total noninterest income | $13499 | $14289 | $(790) | (5.5)% |

---

Noninterest income for the three months ended June 30, 2025 decreased $790 thousand, or 5.5%, to $13.5 million compared to noninterest income of $14.3 million for the three months ended March 31, 2025. The primary drivers of the decrease were as follows:

*Government guaranteed loan income, net.* Government guaranteed loan income, net, includes income related to the sales of SBA and USDA loans. The decrease in government guaranteed loan income, net, of $1.6 million, or 48.9%, during the three months ended June 30, 2025 was primarily due to a favorable valuation on SBA loans in first quarter 2025 compared to second quarter 2025, as well as lower production of SBA loans eligible for sale during second quarter 2025.

*Customer swap income.* The increase in customer swap income of $850 thousand, or 121.4%, during the three months ended June 30, 2025 was primarily due to increased volume of activity compared to the three months ended March 31, 2025.

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*Noninterest Expense*

Noninterest expense is comprised of the cost of operation the Company and servicing customers. The largest component of this is salaries and employee related expenses, but also includes operational expenses such as occupancy and equipment expenses, professional fees and regulatory fees, data processing and software expenses, marketing expenses, amortization of intangibles, telephone and communications expenses and other expenses.

The following table presents, for the periods indicated, the major categories of noninterest expense:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **For the Three Months Ended** | **For the Three Months Ended** | **Increase (Decrease)** | **Increase (Decrease)** |
| *(Dollars in thousands)* | **June 30, 2025** | **March 31, 2025** | **$ change** | **% change** |
| Noninterest expense: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Salaries and employee benefits | $34957 | $36624 | $(1667) | (4.6)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Occupancy and equipment | 4511 | 4650 | (139) | (3.0) |
| &nbsp;&nbsp;&nbsp;&nbsp;Professional and regulatory fees | 5558 | 4931 | 627 | 12.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;Data processing and software expense | 5507 | 5403 | 104 | 1.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;Marketing | 2612 | 2032 | 580 | 28.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;Amortization of intangibles | 2438 | 2438 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Telephone and communications | 233 | 330 | (97) | (29.4) |
| &nbsp;&nbsp;&nbsp;&nbsp;Other | 11346 | 10426 | 920 | 8.8 |
| Total noninterest expense | $67162 | $66834 | $328 | 0.5% |

---

Noninterest expense for the three months ended June 30, 2025 increased $328 thousand, or 0.5%, to $67.2 million compared to $66.8 million for the three months ended March 31, 2025. The most significant components of the increase were as follows:

*Salaries and employee benefits.* Salaries and employee benefits include payroll expense, incentive compensation, benefit plans costs, health insurance and payroll taxes. Additionally, these expenses are impacted by direct loan origination costs, which are deferred and recognized as a component of interest income. Salaries and employee benefits were $35.0 million for the three months ended June 30, 2025, a decrease of $1.7 million, or 4.6%, compared to the three months ended March 31, 2025. The decrease was primarily attributable to $733 thousand in lower payroll taxes, which are historically higher in the first quarter, as well as decreases of $678 thousand in bonus expense, $370 thousand in employee insurance costs and $340 thousand in stock grant expenses, partially offset by a $1.0 million increase in salaries expense. In addition, deferred loan origination costs were $399 thousand higher for the three months ended June 30, 2025.The remaining changes were nominal amongst individual other salaries and employee benefits expense accounts.

*Professional and regulatory fees.* This category includes legal, professional, audit, regulatory, and FDIC assessment fees. Professional and regulatory fees increased by $627 thousand, or 12.7%, compared to the three months ended March 31, 2025, primarily due to higher FDIC assessment fees and other professional services for the three months ended June 30, 2025.

*Marketing.* Marketing expense, including advertising, promotions, donations and business development, increased $580 thousand, or 28.5% during the three months ended June 30, 2025, primarily due to increases in advertising, promotion and sports marketing expenses.

*Other noninterest expense.* Comprised of loan operations and collections, supplies and printing, automatic teller and online expenses and other miscellaneous expenses, this expense category increased $920 thousand, or 8.8%, for the three months ended June 30, 2025 compared to the three months ended March 31, 2025. This increase was primarily due to higher loan-related expenses and other miscellaneous expenses.

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*Income Tax Expense* 

Income tax expense is a function of our pre-tax income, tax-exempt income and other nondeductible expenses. Deferred tax assets and liabilities reflect current statutory income tax rates in effect for the period in which the deferred tax assets and liabilities are expected to be realized or settled. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

Income tax expense totaled $8.5 million for both the three months ended June 30, 2025 and March 31, 2025, with an effective tax rate of 21.6% and 22.7% for the respective periods. The first quarter effective tax rate was higher primarily due to $202 thousand of excess tax expense on share-based awards, compared to an excess tax benefit on share-based awards of $300 thousand for the second quarter 2025.

On July 4, 2025, President Trump signed into law H.R. 1, The One Big Beautiful Bill Act. The Company is still evaluating the provisions of the bill but does not expect the impact to be material.

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**Results of Operations for the Six Months Ended June 30, 2025 and June 30, 2024**

*General*

Net income for the six months ended June 30, 2025 was $60.0 million, an increase of $8.6 million, or 16.8%, from net income of $51.4 million for the six months ended June 30, 2024.

Basic EPS for the six months ended June 30, 2025 was $1.10, an increase of $0.16 per share from $0.94 for the six months ended June 30, 2024. Diluted EPS for the six months ended June 30, 2025 was $1.09, an increase of $0.15 per share from $0.94 for the six months ended June 30, 2024.

*Net Interest Income*

For the six months ended June 30, 2025, net interest income before provisions for credit losses totaled $191.8 million and net interest margin and net interest spread were 3.32% and 2.26%, respectively. For the six months ended June 30, 2024, net interest income before provision for credit losses totaled $189.0 million and net interest margin and net interest spread were 3.27% and 2.01%, respectively. The increase in net interest income of $2.7 million was primarily attributable to decreases in funding costs, including $26.5 million in interest expense on certificates and other time deposits, and $2.7 million in interest expense on FHLB advances. Additionally, higher interest income on debt securities of $4.9 million contributed to the higher net interest income. Those changes were partially offset by a decrease in interest income on loans of $33.1 million during the six months ended June 30, 2025 compared to the six months ended June 30, 2024. Net interest margin increased 5 bps from the six months ended June 30, 2024, primarily due to the decrease in the average rate paid on interest-bearing liabilities from 4.48% for the six months ended June 30, 2024 to 3.78% for the six months ended June 30, 2025, offset partially by a corresponding decrease in yield earned on interest-earning assets from 6.49% for the six months ended June 30, 2024 to 6.04% for the six months ended June 30, 2025, both primarily related to the declining rate environment between the two comparable periods.

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

The following table presents, for the periods indicated, an analysis of net interest income by each major category of interest-earning assets and interest–bearing liabilities, the average amounts outstanding and the interest earned or paid on such amounts. The table also sets forth the average rate earned on interest-earning assets, the average rate paid on interest-bearing liabilities, and the net interest margin on average total interest-earning assets for the same periods. Interest earned on loans that are classified as non-accrual is not recognized in income; however, the balances are reflected in average outstanding balances for the period. For the six months ended June 30, 2025 and June 30, 2024, interest income not recognized on non-accrual loans was $1.6 million and $1.5 million, respectively. Any non-accrual loans have been included in the table as loans carrying a zero yield.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
| | **2025** | **2025** | **2025** | **2024** | **2024** | **2024** |
| | | **Interest** | | | **Interest** | |
| | **Average** | **Earned/** | **Average** | **Average** | **Earned/** | **Average** |
| | **Outstanding** | **Interest** | **Yield/** | **Outstanding** | **Interest** | **Yield/** |
| *(Dollars in thousands)* | **Balance** | **Paid** | **Rate**<sup>(4)</sup> | **Balance** | **Paid** | **Rate**<sup>(4)</sup> |
| Assets |  |  |  |  |  |  |
| Interest-earning assets: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Loans<sup>(1)</sup> | $8881407 | $282017 | 6.40% | $9314148 | $317908 | 6.86% |
| &nbsp;&nbsp;&nbsp;&nbsp;LHI, MW | 475230 | 13842 | 5.87 | 350252 | 11013 | 6.32 |
| &nbsp;&nbsp;&nbsp;&nbsp;Debt securities | 1453721 | 33989 | 4.71 | 1323644 | 29103 | 4.42 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing deposits in other banks | 767511 | 17283 | 4.54 | 572589 | 15772 | 5.54 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equity securities and other investments | 70738 | 1717 | 4.89 | 77616 | 2038 | 5.28 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total interest-earning assets | 11648607 | 348848 | 6.04 | 11638249 | 375834 | 6.49 |
| ACL | (111969) |  |  | (114104) |  |  |
| Noninterest-earning assets | 935850 |  |  | 933229 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total assets | $12472488 |  |  | $12457374 |  |  |
| Liabilities and Stockholders' Equity |  |  |  |  |  |  |
| Interest-bearing liabilities: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing demand and savings deposits | $5476030 | $93245 | 3.43% | $4604887 | $92403 | 4.04% |
| &nbsp;&nbsp;&nbsp;&nbsp;Certificates and other time deposits | 2734527 | 58807 | 4.34 | 3437385 | 85303 | 4.99 |
| &nbsp;&nbsp;&nbsp;&nbsp;Advances from FHLB | 6094 | 140 | 4.63 | 103819 | 2859 | 5.54 |
| &nbsp;&nbsp;&nbsp;&nbsp;Subordinated debentures and subordinated notes | 173713 | 4880 | 5.67 | 230011 | 6227 | 5.44 |
| Total interest-bearing liabilities | 8390364 | 157072 | 3.78 | 8376102 | 186792 | 4.48 |
| Noninterest-bearing liabilities: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Noninterest-bearing deposits | 2294887 |  |  | 2351112 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Other liabilities | 156580 |  |  | 192422 |  |  |
| &nbsp;&nbsp; Total liabilities | 10841831 |  |  | 10919636 |  |  |
| Stockholders' equity | 1630657 |  |  | 1537738 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities and stockholders' equity | $12472488 |  |  | $12457374 |  |  |
| Net interest rate spread<sup>(2)</sup> |  |  | 2.26% |  |  | 2.01% |
| Net interest income |  | $191776 |  |  | $189042 |  |
| Net interest margin<sup>(3)</sup> |  |  | 3.32% |  |  | 3.27% |

---

<sup>(1)</sup> Includes average outstanding balances of LHFS of $64.2 million and $56.2 million for the six months ended June 30, 2025 and June 30, 2024, respectively, and average balances of LHI, excluding MW.

<sup>(2)</sup> Net interest rate spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.

<sup>(3)</sup> Net interest margin is equal to net interest income divided by average interest-earning assets.

<sup>(4)</sup> Yields and rates for the quarter are annualized.

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

The following table presents the changes in interest income and interest expense for the periods indicated for each major component of interest-earning assets and interest-bearing liabilities and distinguishes between the changes attributable to changes in volume and interest rates. For purposes of this table, changes attributable to both rate and volume that cannot be segregated have been allocated to rate.

---

| | | | |
|:---|:---|:---|:---|
| | **For the Six Months Ended** | **For the Six Months Ended** | **For the Six Months Ended** |
| | **June 30, 2025 vs June 30, 2024** | **June 30, 2025 vs June 30, 2024** | **June 30, 2025 vs June 30, 2024** |
| | **Increase (Decrease)** | **Increase (Decrease)** | |
| | **Due to Change in** | **Due to Change in** | |
| *(Dollars in thousands)* | **Volume** | **Rate** | **Total** |
| Interest-earning assets: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Loans | $(14770) | $(21121) | $(35891) |
| &nbsp;&nbsp;&nbsp;&nbsp;LHI, MW | 3930 | (1101) | 2829 |
| &nbsp;&nbsp;&nbsp;&nbsp;Debt securities | 2860 | 2026 | 4886 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing deposits in other banks | 5369 | (3858) | 1511 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equity securities and other investments | (181) | (140) | (321) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total decrease in interest income | $(2792) | $(24194) | $(26986) |
| Interest-bearing liabilities: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing demand and savings deposits | $17481 | $(16639) | $842 |
| &nbsp;&nbsp;&nbsp;&nbsp;Certificates and other time deposits | (17442) | (9054) | (26496) |
| &nbsp;&nbsp;&nbsp;&nbsp;Advances from FHLB and other | (2691) | (28) | (2719) |
| &nbsp;&nbsp;&nbsp;&nbsp;Subordinated debentures and subordinated notes | (1524) | 177 | (1347) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total decrease in interest expense | (4177) | (25543) | (29720) |
| Increase in net interest income | $1385 | $1349 | $2734 |

---

*Provision for Credit Losses*

Our provision for credit losses is a charge to income in order to bring our ACL to a level deemed appropriate by management. For a description of the factors taken into account by management in determining the ACL see "[Financial Condition—ACL on LHI](#if6ca33abab1c4d8d92c037427f17dbf5_8384)". The provision for credit loan losses on loans was $5.8 million for the six months ended June 30, 2025, compared to a $15.8 million provision for credit loan losses for the six months ended June 30, 2024, a decrease of $10.0 million. The decrease in the recorded provision for credit losses on loans for the six months ended June 30, 2025 was primarily attributable to changes in economic factors, qualitative factors and specific credit allocations on individually evaluated loans. For the six months ended June 30, 2025, we recorded a $2.8 million provision for credit losses for unfunded commitments compared to a $1.5 million benefit for unfunded commitments for six months ended June 30, 2024. The ACL to total loans ratio of 1.19% as of June 30, 2025 increased 3 bps from 1.16% at June 30, 2024.

Net charge-offs were $5.2 million for the six months ended June 30, 2025, a decrease of $6.9 million from $12.1 million for the six months ended June 30, 2024. The decrease was primarily due to lower commercial and NOOCRE net charge-offs.

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

*Noninterest Income*

The following table presents, for the periods indicated, the major categories of noninterest income:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the Six Months Ended** | **For the Six Months Ended** | **Increase (Decrease)** | **Increase (Decrease)** |
| *(Dollars in thousands)* | **2025** | **2024** | **$ change** | **% change** |
| Noninterest income: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Service charges and fees on deposit accounts | $11313 | $9870 | $1443 | 14.6% |
| &nbsp;&nbsp;&nbsp;&nbsp;Loan fees | 5230 | 4717 | 513 | 10.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;Loss on sales of debt securities |  | (6304) | 6304 | (100.0) |
| &nbsp;&nbsp;&nbsp;&nbsp;Government guaranteed loan income, net | 4989 | 3934 | 1055 | 26.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;Customer swap income | 2250 | 775 | 1475 | 190.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other income | 4006 | 4248 | (242) | (5.7) |
| Total noninterest income | $27788 | $17240 | $10548 | 61.2% |

---

Noninterest income for the six months ended June 30, 2025 increased $10.5 million, or 61.2%, to $27.8 million compared to $17.2 million for the six months ended June 30, 2024. The primary drivers of the increase were as follows:

*Service charges and fees on deposit accounts.* We earn service charges and fees from our customers for deposit-related activities. The $1.4 million, or 14.6%, increase in service charges and fees on deposit accounts is primarily due to higher service charges on corporate customers for the six months ended June 30, 2025 compared to the same period in the prior year.

*Loss on sales of debt securities.* The Company recognized a non-recurring loss of $6.3 million during the six months ended June 30, 2024 as a result of a strategic restructuring in which it sold $120.1 million of lower-yielding AFS debt securities, with no corresponding loss recorded in the six months ended June 30, 2025.

*Government guaranteed loan income, net.* Government guaranteed loan income, net, includes income related to the sales of SBA and USDA loans. The increase in net government guaranteed loan income of $1.1 million, or 26.8%, during the six months ended June 30, 2025 is primarily due to a larger volume of SBA loan production in the six months ended June 30, 2025 compared to the six months ended June 30, 2024.

*Customer swap income.* These derivative instruments are not designated as accounting hedges and changes in the net fair value are recognized in noninterest income. The increase of $1.5 million, or 190.3%, during the six months ended June 30, 2025 is primarily due to increased volume of activity, compared to the six months ended June 30, 2024.

*Noninterest Expense*

The following table presents, for the periods indicated, the major categories of noninterest expense:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **For the Six Months Ended** | **For the Six Months Ended** | **Increase (Decrease)** | **Increase (Decrease)** |
| *(Dollars In thousands)* | **2025** | **2024** | **$ change** | **% change** |
| Noninterest expense |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Salaries and employee benefits | $71581 | $66155 | $5426 | 8.2% |
| &nbsp;&nbsp;&nbsp;&nbsp;Occupancy and equipment | 9161 | 9262 | (101) | (1.1) |
| &nbsp;&nbsp;&nbsp;&nbsp;Professional and regulatory fees | 10489 | 11670 | (1181) | (10.1) |
| &nbsp;&nbsp;&nbsp;&nbsp;Data processing and software expense | 10910 | 9953 | 957 | 9.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;Marketing | 4644 | 3522 | 1122 | 31.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;Amortization of intangibles | 4876 | 4876 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Telephone and communications | 563 | 626 | (63) | (10.1) |
| &nbsp;&nbsp;&nbsp;&nbsp;Other | 21772 | 19193 | 2579 | 13.4 |
| Total noninterest expense | $133996 | $125257 | $8739 | 7.0% |

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

Noninterest expense for the six months ended June 30, 2025 increased $8.7 million, or 7.0%, to $134.0 million compared to noninterest expense of $125.3 million for the six months ended June 30, 2024. The most significant components of the increase were as follows:

*Salaries and employee benefits.* Salaries and employee benefits include payroll expense, the cost of incentive compensation, benefit plans, health insurance and payroll taxes. Additionally, these expenses are impacted by direct loan origination costs, which are deferred and recognized as a component of interest income. Salaries and employee benefits increased $5.4 million, or 8.2%, during the six months ended June 30, 2025 compared to the six months ended June 30, 2024. The increase was primarily attributable to increases of $3.2 million in salaries, $5.6 million in incentive accruals, $972 thousand in payroll taxes and $710 thousand in other employee benefits, due primarily to increased headcount for the year over year period. These increases were offset by $1.6 million in lower stock grant expense. In addition, there was an increase of $3.0 million in deferred origination costs for the year over year period.

*Professional and regulatory fees.* This category includes legal, professional, audit, regulatory, and FDIC assessment fees. Professional and regulatory fees decreased $1.2 million, or 10.1%, compared to the six months ended June 30, 2024. The decrease is primarily due to a decrease in FDIC assessment fees of $1.3 million for the year over year period.

*Data processing and software expense.* This category of expenses includes expense related to data processing and software expenses. Data processing and software costs increased $957 thousand, or 9.6%, compared to the six months ended June 30, 2024. The increase is primarily due to an increase of $652 thousand in software expenses and $305 thousand in data processing costs. The increase is related to technological enhancements to support growth and meet regulatory requirements.

*Marketing.* Marketing expense, including advertising, promotions, donations and business development, increased $1.1 million, or 31.9%, compared to the six months ended June 30, 2024 largely due to marketing and sponsorship opportunities that increased expense during the six months ended June 30, 2025.

*Other noninterest expense.* Comprised of loan operations and collections, supplies and printing, automatic teller and online expenses and other miscellaneous expenses, this expense category increased $2.6 million, or 13.4% primarily due to an increase of $1.4 million in OREO expenses during the six months ended June 30, 2025 as compared to the same period in 2024. The remaining changes were nominal amongst individual other noninterest expense accounts.

*Income Tax Expense*

Income tax expense is a function of our pre-tax income, tax-exempt income and other nondeductible expenses. Deferred tax assets and liabilities reflect current statutory income tax rates in effect for the period in which the deferred tax assets and liabilities are expected to be realized or settled. As changes in tax laws or statutory tax rates are enacted, deferred tax assets and liabilities are adjusted through the provision of income taxes. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

For the six months ended June 30, 2025, income tax expense totaled $17.0 million, an increase of $1.6 million, or 10.2%, compared to an income tax expense of $15.5 million for the six months ended June 30, 2024. The effective tax rate was 22.1% and 23.1% over the same respective periods. The decrease in the effective rate was driven by a one-time expense and discrete tax expenses related to share-base awards, both of which occurred in the six months ended June 30, 2024.

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

**Financial Condition**

Our total assets decreased $240.5 million, or 1.9%, from $12.77 billion as of December 31, 2024 to $12.53 billion as of June 30, 2025. The slight decrease was primarily due to declines in the Company's cash balances, securities and LHFS and LHI portfolios.

*Loan Portfolio*

Our primary source of income is interest on loans to individuals, professionals, small to medium-sized businesses and commercial companies primarily located in the DFW metroplex and Houston metropolitan area. Our loan portfolio consists primarily of commercial loans and real estate loans secured by CRE properties located in our primary market areas. Our loan portfolio represents the highest yielding component of our interest-earning asset base.

As of June 30, 2025, total LHI, excluding ACL, was $9.46 billion, a decrease of $51.8 million, or 0.5%, compared to $9.51 billion as of December 31, 2024. In addition to these amounts, $69.5 million and $89.3 million in loans were classified as LHFS as of June 30, 2025 and December 31, 2024, respectively.

Total LHI as a percentage of deposits were 90.8% and 88.5% as of June 30, 2025 and December 31, 2024, respectively. Total LHI, excluding MW loans, as a percentage of deposits were 84.4% and 82.8% as of June 30, 2025 and December 31, 2024, respectively. Total LHI as a percentage of assets were 75.5% and 74.5% as of June 30, 2025 and December 31, 2024, respectively.

The following table summarizes our loan portfolio by type of loan as of the dates indicated:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **As of June 30, 2025** | **As of June 30, 2025** | **As of December 31, 2024** | **As of December 31, 2024** | **Increase (Decrease)** | **Increase (Decrease)** |
| *(Dollars in thousands)* | **Amount** | **% of Total** | **Amount** | **% of Total** | **Amount** | **% Change** |
| Commercial | $2692209 | 28.4% | $2693538 | 28.3% | $(1329) | —% |
| MW | 669052 | 7.1 | 605411 | 6.4 | 63641 | 10.5 |
| Real estate: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;OOCRE | 800881 | 8.5 | 780003 | 8.2 | 20878 | 2.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;NOOCRE | 2311466 | 24.4 | 2382499 | 25.0 | (71033) | (3.0) |
| &nbsp;&nbsp;&nbsp;&nbsp;Construction and land | 1142457 | 12.1 | 1303711 | 13.7 | (161254) | (12.4) |
| &nbsp;&nbsp;&nbsp;&nbsp;Farmland | 31589 | 0.3 | 31690 | 0.3 | (101) | (0.3) |
| &nbsp;&nbsp;&nbsp;&nbsp;1-4 family residential | 1086342 | 11.5 | 957341 | 10.1 | 129001 | 13.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;Multifamily | 718946 | 7.6 | 750218 | 7.9 | (31272) | (4.2) |
| Consumer | 8796 | 0.1 | 9115 | 0.1 | (319) | (3.5) |
| Total LHI, gross | 9461738 | 100.0% | 9513526 | 100.0% | $(51788) | (0.5)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Less: deferred loans fees, net | (8698) |  | (8982) |  |  |  |
| Total LHI, at amortized cost | $9453040 |  | $9504544 |  |  |  |
| Total LHFS | $69480 |  | $89309 |  |  |  |

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

*CRE Portfolio Composition*

The majority of our CRE loan portfolio consists of multifamily residential, NOOCRE and construction and land loans. The table below details the composition of the multifamily residential, NOOCRE and construction and land loan portfolios by borrower type and geographic location.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(Dollars in thousands)* | **As of June 30, 2025** | **As of June 30, 2025** | **As of June 30, 2025** | **As of June 30, 2025** | **As of June 30, 2025** |  |
| **Property Type** | **DFW** | **Houston** | **Secondary Texas**<sup>(1)</sup> | **Out of State** | **Total** | **% of Total Loans** |
| &nbsp;&nbsp;Industrial | $364272 | $277019 | $172093 | $249284 | $1062668 | 11.2% |
| &nbsp;&nbsp;Multifamily | 331408 | 266529 | 183985 | 173323 | 955245 | 10.1 |
| &nbsp;&nbsp;Office | 321114 | 127998 | 12041 | 20088 | 481241 | 5.1 |
| &nbsp;&nbsp;Retail | 203659 | 158219 | 115123 | 92156 | 569157 | 6.0 |
| &nbsp;&nbsp;Hotel | 188147 | 14257 | 112843 | 117434 | 432681 | 4.6 |
| &nbsp;&nbsp;SFR | 285311 | 48071 | 69273 | 14513 | 417168 | 4.4 |
| &nbsp;&nbsp;Other | 93980 | 57844 | 60465 | 42420 | 254709 | 2.7 |
| Total CRE | $1787891 | $949937 | $725823 | $709218 | $4172869 | 44.1% |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| *(Dollars in thousands)* | **As of December 31, 2024** | **As of December 31, 2024** | **As of December 31, 2024** | **As of December 31, 2024** | **As of December 31, 2024** |  |
| **Property Type** | **DFW** | **Houston** | **Secondary Texas**<sup>(1)</sup> | **Out of State** | **Total** | **% of Total Loans** |
| &nbsp;&nbsp;Industrial | $406146 | $250586 | $156214 | $281866 | $1094812 | 11.5% |
| &nbsp;&nbsp;Multifamily | 425774 | 351177 | 213560 | 153644 | 1144155 | 12.0 |
| &nbsp;&nbsp;Office | 318638 | 116090 | 32737 | 32632 | 500097 | 5.3 |
| &nbsp;&nbsp;Retail | 173747 | 172690 | 110141 | 157681 | 614259 | 6.5 |
| &nbsp;&nbsp;Hotel | 192940 | 22603 | 113923 | 127358 | 456824 | 4.8 |
| &nbsp;&nbsp;SFR | 236027 | 32193 | 62622 | 11832 | 342674 | 3.6 |
| &nbsp;&nbsp;Other | 91500 | 61942 | 75142 | 55023 | 283607 | 3.0 |
| Total CRE | $1844772 | $1007281 | $764339 | $820036 | $4436428 | 46.6% |

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<sup>(1)</sup> Includes loans made to markets in the state of Texas outside of DFW and Houston.

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

*Out of State Concentration*

The majority of the Company's loan portfolio consists of loans to businesses and individuals in the DFW metroplex and the Houston metropolitan area. The following table provides details on our out of state portfolio concentration:

---

| | | | | |
|:---|:---|:---|:---|:---|
| *(Dollars in thousands)* | **As of June 30, 2025** | **As of June 30, 2025** | **As of December 31, 2024** | **As of December 31, 2024** |
| **Out of State Loan Portfolio** | **Amount** | **% of Total Loans** | **Amount** | **% of Total Loans** |
| &nbsp;&nbsp;CRE | $709218 | 7.5% | $820036 | 8.6% |
| &nbsp;&nbsp;Lender Finance | 504316 | 5.3 | 473007 | 5.0 |
| &nbsp;&nbsp;Commercial | 411222 | 4.3 | 408914 | 4.3 |
| &nbsp;&nbsp;MW | 378251 | 4.0 | 335815 | 3.6 |
| &nbsp;&nbsp;Mortgage Servicing | 275505 | 2.9 | 311119 | 3.3 |
| &nbsp;&nbsp;1-4 Family Residential | 310827 | 3.3 | 246547 | 2.6 |
| &nbsp;&nbsp;USDA and SBA | 167663 | 1.8 | 183672 | 1.9 |
| &nbsp;&nbsp;Other | 38379 | 0.4 | 14244 | 0.1 |
| Total Out of State Loans | $2795381 | 29.5% | $2793354 | 29.4% |

---

*Nonperforming Assets*

The following table presents information regarding nonperforming assets by category as of the dates indicated:

---

| | | |
|:---|:---|:---|
| *(Dollars in thousands)* | **As of June 30, 2025** | **As of December 31, 2024** |
| Nonperforming loans <sup>(1)</sup> |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Construction and land | $6120 | $6373 |
| &nbsp;&nbsp;&nbsp;&nbsp;1-4 family residential | 1347 | 1562 |
| &nbsp;&nbsp;&nbsp;&nbsp;OOCRE | 8789 | 8887 |
| &nbsp;&nbsp;&nbsp;&nbsp;NOOCRE | 27486 | 10967 |
| &nbsp;&nbsp;&nbsp;&nbsp;Commercial | 17550 | 24680 |
| &nbsp;&nbsp;&nbsp;&nbsp;Consumer | 46 | 52 |
| Accruing loans 90 or more days past due | 4641 | 1914 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total nonperforming loans | 65979 | 54435 |
| OREO | 9218 | 24737 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total nonperforming assets | $75197 | $79172 |
| Nonperforming assets to total assets | 0.60% | 0.62% |
| Nonperforming assets to total LHI and OREO | 0.79% | 0.83% |
| Nonperforming loans to total LHI | 0.70% | 0.57% |
| <sup>&nbsp;&nbsp;&nbsp;&nbsp; (1)</sup> Represents loans on nonaccrual status, unless otherwise noted  |  |  |

---

Nonperforming assets totaled $75.2 million as of June 30, 2025, compared to $79.2 million as of December 31, 2024, a decrease of $4.0 million, or 5.0%. Nonperforming loans totaled $66.0 million as of June 30, 2025, compared to $54.4 million as of December 31, 2024, an increase of $11.5 million, or 21.2%. The increase in nonperforming loans was primarily due to two NOOCRE relationships totaling $18.5 million being added to nonaccrual during the six months ended June 30, 2025.

OREO declined $15.5 million to $9.2 million at June 30, 2025 from $24.7 million at December 31, 2024 due to the sale of two OREO properties during the six months ended June 30, 2025.

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<u>[**Table of Contents**](#i99d8b0fb842e4018a10d7d1e55bdf145_10)</u>

*Potential Problem Loans*

The following tables summarize our internal ratings of our loans as of the dates indicated.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
| *(Dollars in thousands)* | **Pass** | **Special<br>Mention** | **Substandard** | **PCD** | **Total** |
| Real estate: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Construction and land | $1081629 | $25640 | $35188 | $— | $1142457 |
| &nbsp;&nbsp;&nbsp;&nbsp;Farmland | 31589 |  |  |  | 31589 |
| &nbsp;&nbsp;&nbsp;&nbsp;1 - 4 family residential | 1082394 | 245 | 2690 | 1013 | 1086342 |
| &nbsp;&nbsp;&nbsp;&nbsp;Multi-family residential | 696633 | 21764 | 549 |  | 718946 |
| &nbsp;&nbsp;&nbsp;&nbsp;OOCRE | 758303 | 9119 | 24660 | 8799 | 800881 |
| &nbsp;&nbsp;&nbsp;&nbsp;NOOCRE | 2212206 | 56314 | 42602 | 344 | 2311466 |
| Commercial | 2519824 | 78520 | 93616 | 249 | 2692209 |
| MW | 669052 |  |  |  | 669052 |
| Consumer | 8678 | 66 | 48 | 4 | 8796 |
| Total | $9060308 | $191668 | $199353 | $10409 | $9461738 |

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| *(Dollars in thousands)* | **Pass** | **Special<br>Mention** | **Substandard** | **PCD** | **Total** |
| Real estate: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Construction and land | $1246075 | $24869 | $32767 | $— | $1303711 |
| &nbsp;&nbsp;&nbsp;&nbsp;Farmland | 31690 |  |  |  | 31690 |
| &nbsp;&nbsp;&nbsp;&nbsp;1 - 4 family residential | 951069 | 2766 | 2462 | 1044 | 957341 |
| &nbsp;&nbsp;&nbsp;&nbsp;Multi-family residential | 749660 |  | 558 |  | 750218 |
| &nbsp;&nbsp;&nbsp;&nbsp;OOCRE | 735886 | 12867 | 21884 | 9366 | 780003 |
| &nbsp;&nbsp;&nbsp;&nbsp;NOOCRE | 2211850 | 77426 | 92871 | 352 | 2382499 |
| Commercial | 2594686 | 35371 | 63178 | 303 | 2693538 |
| MW | 605411 |  |  |  | 605411 |
| Consumer | 8975 | 74 | 58 | 8 | 9115 |
| Total | $9135302 | $153373 | $213778 | $11073 | $9513526 |

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*ACL on LHI*

We maintain an ACL that represents management's best estimate of the credit losses and risks inherent in the loan portfolio. In determining the ACL, we estimate losses on specific loans, or groups of loans, where the probable loss can be identified and reasonably determined. The balance of the ACL is based on internally assigned risk classifications of loans, historical loan loss rates, changes in the nature of the loan portfolio, overall portfolio quality, industry concentrations, delinquency trends, current economic factors and the estimated impact of current economic conditions on certain historical loan loss rates.

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The following table presents, as of and for the periods indicated, an analysis of the ACL and other related data:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| *(Dollars in thousands)* | **Allocated Allowance** | **% of Loan Portfolio** | **ACL to Loans** | **Allocated Allowance** | **% of Loan Portfolio** | **ACL to Loans** |
| Construction and land | $20381 | 12.1% | 1.78% | $15457 | 13.7% | 1.19% |
| Farmland | 92 | 0.3 | 0.29 | 97 | 0.3 | 0.31 |
| 1 - 4 family residential | 18553 | 11.4 | 1.71 | 15639 | 10.1 | 1.63 |
| Multi-family residential | 4204 | 7.6 | 0.58 | 4849 | 7.9 | 0.65 |
| OOCRE | 17007 | 8.5 | 2.12 | 17546 | 8.2 | 2.25 |
| NOOCRE | 34779 | 24.4 | 1.50 | 39968 | 25.0 | 1.68 |
| Commercial | 16941 | 28.5 | 0.63 | 17654 | 28.3 | 0.66 |
| MW | 212 | 7.1 | 0.03 | 321 | 6.4 | 0.05 |
| Consumer | 93 | 0.1 | 1.06 | 214 | 0.1 | 2.35 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $112262 | 100.0% | 1.19% | $111745 | 100.0% | 1.18% |

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The ACL increased $517 thousand to $112.3 million as of June 30, 2025 from $111.7 million at December 31, 2024.

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| | | | |
|:---|:---|:---|:---|
| *(Dollars in thousands)* | **Net (Charge-offs) Recoveries** | **Average Loans** | **Annualized Net (Charge-off) Recoveries to Average Loans** |
| **Six Months Ended June 30, 2025** |  |  |  |
| Construction and land | $— | $1356110 | —% |
| Farmland |  | 31039 |  |
| 1 - 4 family residential | 22 | 1020407 |  |
| Multi-family residential |  | 737578 |  |
| OOCRE | 186 | 786488 | 0.05 |
| NOOCRE | (3305) | 2240900 | (0.30) |
| Commercial | (2326) | 2700477 | (0.17) |
| MW |  | 475230 |  |
| Consumer | 190 | 8408 | 4.56 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $(5233) | $9356637 | (0.11)% |
| **Six Months Ended June 30, 2024** |  |  |  |
| Construction and land | $— | $1683214 | —% |
| Farmland |  | 31515 |  |
| 1 - 4 family residential | (30) | 960154 | (0.01) |
| Multi-family residential | (198) | 750598 | (0.05) |
| OOCRE |  | 781114 |  |
| NOOCRE | (6262) | 2291088 | (0.55) |
| Commercial | (6090) | 2807438 | (0.44) |
| MW |  | 350252 |  |
| Consumer | 445 | 9027 | 9.91 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $(12135) | $9664400 | (0.25)% |

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Net charge-offs decreased $6.9 million, or 14 bps, to average loans annualized. Although the ACL is estimated in accordance with GAAP and adequately provides for known and inherent losses in the portfolio at all times shown above, future provisions will be subject to ongoing evaluations of the risks in our loan portfolio and changes in the economic environment. If we experience economic declines or asset quality deterioration, material additional provisions could be required.

*OBS Credit exposure* 

The ACL on OBS credit exposures totaled $8.9 million and $6.1 million at June 30, 2025 and December 31, 2024, respectively. The level of the ACL on OBS credit exposures depends upon the volume of outstanding commitments, underlying risk grades, the expected utilization of available funds and forecasted economic conditions impacting our loan portfolio.

*Equity Securities*

As of June 30, 2025, we held equity securities with a readily determinable fair value of $10.0 million compared to $9.8 million as of December 31, 2024. These equity securities primarily represent investments in a publicly traded CRA fund and are subject to market pricing volatility, with changes in fair value recorded in earnings.

The Company held equity securities without a readily determinable fair values and measured at cost of $10.5 million at June 30, 2025 compared to $12.3 million at December 31, 2024. The decrease from December 31, 2024 is primarily due to the sale of an equity security totaling approximately $2.5 million, which resulted in a gain on sale of $468 thousand. The Company measures equity securities that do not have readily determinable fair values at cost minus impairment, if any, plus or minus observable price changes in orderly transactions for an identical or similar investment of the same issuer.

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*FHLB Stock and FRB Stock*

As of June 30, 2025, we held FHLB stock and FRB stock of $52.5 million compared to $46.6 million as of December 31, 2024. The Bank is a member of its regional FRB and of the FHLB system. FHLB members are required to own a certain amount of stock based on the level of borrowings and other factors, and may invest in additional amounts. Both FRB and FHLB stock are carried at cost, restricted for sale, and periodically evaluated for impairment based on ultimate recovery of par value. Both cash and stock dividends are reported as income.

*Debt Securities*

We use our debt securities portfolio to provide an appropriate return on funds invested, manage interest rate risk, meet collateral and regulatory capital requirements, and as a source of liquidity. As of June 30, 2025, the carrying amount of debt securities totaled $1.42 billion, a decrease of $59.7 million, or 4.0%, compared to $1.48 billion as of December 31, 2024. Debt securities represented 11.3% and 11.6% of total assets as of June 30, 2025 and December 31, 2024, respectively.

All of our MBS and CMOs are issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored entities. We do not hold any Fannie Mae or Freddie Mac preferred stock, corporate equity, collateralized debt obligations, structured investment vehicles, private label CMOs, subprime, Alt-A, or second lien elements in our investment portfolio. As of June 30, 2025, our investment portfolio did not contain any securities that are directly backed by subprime or Alt-A mortgages.

Management evaluates debt securities in unrealized loss positions to determine whether the impairment is due to credit-related factors or noncredit-related factors. The Company has 127 AFS debt securities that were in an unrealized loss position totaling $61.6 million as of June 30, 2025, as well as 55 HTM securities in an unrealized loss positioning totaling $24.2 million as of the same date. For AFS securities, consideration is given to (1) the extent to which the fair value is less than cost, (2) the financial condition and near-term prospects of the issuer, and (3) the intent and ability of the Company to retain its investment in the security for a period of time sufficient to allow for any anticipated recovery in fair value. HTM securities are evaluated using the same impairment framework as loans held for investment. The Company evaluated all debt securities and no ACL was recognized in the Company's consolidated balance sheets as of June 30, 2025 or December 31, 2024.

As of June 30, 2025 and December 31, 2024, we did not own securities of any one issuer for which aggregate cost exceeded 10.0% of our stockholders' equity as of such respective dates.

*Deposits*

Total deposits as of June 30, 2025 were $10.42 billion, a decrease of $334.7 million, or 3.1%, compared to $10.75 billion as of December 31, 2024. The decrease from December 31, 2024 was the result of decreases of $166.1 million in certificates and other time deposits, $58.4 million in correspondent money market deposits, $58.2 million in noninterest-bearing deposits and $52.0 million in interest-bearing transaction and savings accounts.

*Borrowings*

At June 30, 2025, short-term borrowings consisted of FHLB advances and totaled $169.0 million with a contractual pay rate of 4.75%. The advances were taken out for short-term liquidity needs and matured on July 1, 2025. We had no short-term borrowings as of December 31, 2024.

We utilize short- and long-term borrowings to supplement deposits to fund our lending and investment activities, each of which is discussed below. Subordinated debentures and subordinated notes as of June 30, 2025 and December 31, 2024 were as follows:

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| | | |
|:---|:---|:---|
| *(Dollars in thousands)* | **June 30, 2025** | **December 31, 2024** |
| Subordinated notes, net of debt issuance costs | $124843 | $199607 |
| Subordinated debentures, net of discount | 31239 | 31129 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total subordinated notes and debentures | $156082 | $230736 |

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Total subordinated notes and subordinated debentures decreased $74.7 million, or 32.4%, due to the redemption of $75.0 million of subordinated notes during the first quarter 2025, as discussed in Note 6 "[Borrowings](#i99d8b0fb842e4018a10d7d1e55bdf145_127)" in the notes to the consolidated financial statements included in this report.

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Refer to Note 13 "Subordinated Debentures and Subordinated Notes" in our Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion on the details of our junior subordinated debentures and subordinated notes.

**Liquidity and Capital Resources**

*Liquidity*

Liquidity management involves our ability to raise funds to support asset growth and acquisitions or reduce assets to meet deposit withdrawals and other payment obligations, to maintain reserve requirements, to operate on an ongoing basis and manage unexpected events. For the six months ended June 30, 2025 and the year ended December 31, 2024, our liquidity needs were primarily met by core deposits, wholesale borrowings and security and loan amortization and maturities. Use of brokered deposits, purchased funds from correspondent banks and overnight advances from the FHLB and the FRB are available and have been utilized to take advantage of the cost of these funding sources.

*FHLB*

The FHLB allows us to borrow on a blanket floating lien status collateralized by certain securities and loans. As of June 30, 2025 and December 31, 2024, a total remaining borrowing capacity of $2.18 billion and $2.36 billion, respectively, was available under this arrangement in addition to $169.0 million outstanding balance as of June 30, 2025. There were no outstanding advances as of December 31, 2024. Additionally, there were outstanding standby letters of credit with the FHLB of $992.3 million and $1.06 billion as of June 30, 2025 and December 31, 2024, respectively.

*FRB*

The FRB has an available borrower in custody arrangement, which allows us to borrow on a collateralized basis. Certain loans and securities are pledged under this arrangement to meet potential future liquidity needs pursuant to our contingency funding plan, although there were no outstanding borrowings with the FRB as of June 30, 2025 and December 31, 2024. The following table outlines assets pledged and borrowing capacity with the FRB as of June 30, 2025 and December 31, 2024:

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| | | |
|:---|:---|:---|
| *(Dollars in thousands)* | **June 30, 2025** | **December 31, 2024** |
| FRB loans pledged as collateral | $2302086 | $2165451 |
| FRB securities pledged as collateral | 690595 | 745648 |
| Total FRB availability | $2992681 | $2911099 |

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In addition, we maintained five lines of credit with commercial banks that provide for extensions of credit with an availability to borrow up to an aggregate of $150.0 million as of June 30, 2025 and December 31, 2024. There were no advances under these lines of credit outstanding as of June 30, 2025 and December 31, 2024.

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The following table illustrates, during the periods presented, the mix of our funding sources and the average assets in which those funds are invested as a percentage of our average total assets for the period indicated. Average assets totaled $12.47 billion for the six months ended June 30, 2025 and $12.63 billion for the year ended December 31, 2024.

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| | | |
|:---|:---|:---|
| | **For the Six Months Ended**<br>**June 30, 2025** | **For the Year Ended**<br>**December 31, 2024** |
| Sources of Funds: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Noninterest-bearing | 18.4% | 19.0% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing | 43.9 | 37.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certificates and other time deposits | 21.9 | 27.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;Advances from FHLB |  | 0.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other borrowings | 1.4 | 1.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other liabilities | 1.3 | 1.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;Stockholders' equity | 13.1 | 12.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | 100.0% | 100.0% |
| Uses of Funds: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Loans | 74.1% | 75.2% |
| &nbsp;&nbsp;&nbsp;&nbsp;Debt Securities | 11.7 | 10.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing deposits in other banks | 6.2 | 0.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other assets | 8.0 | 13.3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | 100.0% | 100.0% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Average noninterest-bearing deposits to average deposits | 21.8% | 22.6% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Average loans, excluding MW, to average deposits | 84.5% | 86.8% |

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Our primary source of funds is deposits and our primary use of funds is loans. We do not expect a change in the primary source or use of our funds in the foreseeable future and believe that funds provided by such means will be sufficient to satisfy our anticipated cash requirements for the next twelve months and foreseeable future. Our average LHI decreased 2.6% for the six months ended June 30, 2025, compared to the year ended December 31, 2024.

As of June 30, 2025, we had $3.68 billion in outstanding commitments to extend credit, $650.9 million in unconditionally cancellable MW commitments and $112.7 million in commitments associated with outstanding standby and commercial letters of credit. As of December 31, 2024, we had $3.12 billion in outstanding commitments to extend credit, $562.6 million in MW commitments and $111.9 million in commitments associated with outstanding standby and commercial letters of credit. Since commitments associated with letters of credit and commitments to extend credit may expire unused, the total outstanding may not necessarily reflect the actual future cash funding requirements.

As of June 30, 2025, we had cash and cash equivalents of $770.6 million compared to $855.2 million as of December 31, 2024.

*Current Ratings from Rating Agency*

The ability of the Company to raise unsecured funding at competitive rates is impacted by rating agencies' views of the credit quality, liquidity, capital, earnings and other relevant factors related to the Company. During 2025, the ratings were reaffirmed by Kroll Bond Rating Agency and assigned the following ratings to long-term senior unsecured obligations of the Company, as well as long-term deposits at the Bank. A security rating is not a recommendation to buy, sell, or hold securities and may be subject to revision or withdrawal at any time by the assigning rating agency. Each rating should be evaluated independently of any other rating.

 Long-Term Deposit and Senior Unsecured Debt Rating Subordinated Debt Rating Short-Term Deposit and Debt Rating<sup>(1)</sup> <br> Kroll Bond Rating Agency BBB+ BBB K2

<sup>(1)</sup> For the subsidiary, Veritex Community Bank.

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*Share Repurchases*

On March 28, 2024, the Board authorized a stock buyback program (the "Stock Buyback Program") pursuant to which the Company could, from time to time, purchase up to $50 million of its outstanding common stock in the aggregate. On March 25, 2025, the Board authorized the extension of the Stock Buyback Program through March 31, 2026. The Stock Buyback Program does not obligate the Company to purchase any shares and may be suspended, terminated, amended or modified by the Board at any time without prior notice at the Board's discretion. The shares may be repurchased in the open market or in privately negotiated transactions from time to time, depending upon market conditions and other factors, and in accordance with applicable regulations of the SEC.

Shares repurchased through the periods indicated are as follows:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Six Months Ended June 30,** | **Six Months Ended June 30,** |
| | **2025** | **2024** | **2025** | **2024** |
| Numbers of shares repurchased | 286291 | 175688 | 663637 | 175688 |
| Weighted average price per share | $24.06 | $19.90 | $24.72 | $19.90 |

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*2025 Equity Incentive Plan*

In May 2025, the shareholders of the Company approved the 2025 Amended and Restated Omnibus Incentive Plan (2025 Plan). Under this plan, the Compensation Committee may grant awards in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, cash-based awards, stock awards and performance-based awards. Awards outstanding under any prior plan will remain in effect under the prior plan according to their respective terms. The 2025 Plan has 900,000 reserved shares of common stock to be awarded by the Company's Compensation Committee.

*Capital Resources*

Total stockholders' equity increased to $1.65 billion as of June 30, 2025 compared to $1.60 billion as of December 31, 2024, an increase of $48.2 million, or 3.0%. The increase from December 31, 2024 to June 30, 2025 was primarily the result of $60.0 million of net income recognized, $26.5 million increase in AOCI and $5.1 million in stock-based compensation. This increase was partially offset by $22.9 million in dividends paid, $16.6 million in stock buybacks and $4.2 million of RSUs vesting during the six months ended June 30, 2025.

Capital management consists of providing equity to support our current and future operations. Our regulators view capital levels as important indicators of an institution's financial soundness. As a general matter, FDIC-insured depository institutions and their holding companies are required to maintain minimum capital relative to the amount and types of assets they hold. We are subject to regulatory capital requirements at the bank holding company and bank levels. See Note 12 – "[Capital Requirements and Restrictions on Retained Earnings](#i99d8b0fb842e4018a10d7d1e55bdf145_106)" in the notes to our consolidated financial statements for additional discussion regarding the regulatory capital requirements applicable to us and the Bank. As of June 30, 2025 and December 31, 2024, we and the Bank were in compliance with all applicable regulatory capital requirements, and the Bank was classified as "well capitalized" for purposes of the PCA regulations. As we employ our capital and continue to grow our operations, our regulatory capital levels may decrease depending on our level of earnings. However, we expect to monitor and control our growth in order to remain in compliance with all regulatory capital standards applicable to us.

*Contractual Obligations*

In the ordinary course of the Company's operations, we have entered into contractual obligations and have made other commitments to make future payments. Other than normal changes in the ordinary course of business and changes discussed within "[Financial Condition](#if6ca33abab1c4d8d92c037427f17dbf5_8383)**[—](#if6ca33abab1c4d8d92c037427f17dbf5_8383)**[Borrowings](#if6ca33abab1c4d8d92c037427f17dbf5_8383)," there have been no significant changes in the types of contractual obligations or amounts due as of June 30, 2025 and since December 31, 2024 as reported in our Annual Report on Form 10-K for the year ended December 31, 2024.

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**Critical Accounting Policies**

Our accounting policies are fundamental to understanding our management's discussion and analysis of our results of operations and financial condition. We have identified certain significant accounting policies which involve a higher degree of judgment and complexity in making certain estimates and assumptions that affect amounts reported in our consolidated financial statements. The current significant accounting policies which we believe to be the most critical in preparing our consolidated financial statements relate to ACL and goodwill. Since December 31, 2024, there have been no changes in critical accounting policies as described under "Management's Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies" in our Form 10-K for the year ended December 31, 2024.

**Cautionary Notice Regarding Forward-Looking Statements**

This Quarterly Report on Form 10-Q includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on various facts and derived utilizing assumptions, current expectations, estimates and projections and are subject to known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements include, without limitation, statements relating to the expected payment date of our quarterly cash dividend, impact of certain changes in our accounting policies, standards and interpretations, any turmoil in the banking industry, responsive measures to mitigate and manage it and related supervisory and regulatory actions and costs and our future financial performance, business and growth strategy, projected plans and objectives, as well as other projections based on macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact broader economic and industry trends, and any such variations may be material. Statements preceded by, followed by or that otherwise include the words "believes," "expects," "anticipates," "intends," "seeks," "projects," "estimates," "targets," "outlooks," "plans" and similar expressions or future or conditional verbs such as "will," "should," "would," "may" and "could" are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing words. You should understand that the following important factors could affect our future results and cause actual results to differ materially from those expressed in the forward-looking statements:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• risks related to the proposed merger with Huntington including, among others (i) the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the merger agreement between Huntington and Veritex; (ii) the outcome of any legal proceedings that may be instituted against Huntington or Veritex; (iii) delays in completing the merger; the failure to obtain necessary regulatory approvals (and the risk that such approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the merger); (iv) the failure to obtain the requisite vote of Veritex stockholders or to satisfy any of the other conditions to the merger on a timely basis or at all; (v) the possibility that the anticipated benefits of the merger are not realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where Huntington and Veritex do business; (vi) the possibility that the merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events; diversion of management's attention from ongoing business operations and opportunities; (vii) potential adverse reactions or changes to business, customer or employee relationships, including those resulting from the announcement or completion of the merger; (viii) the ability to complete the merger and integration of Huntington and Veritex successfully; (ix) the dilution caused by Huntington's issuance of additional shares of its capital stock in connection with the merger; (x) changes in policies and standards for regulatory review of bank mergers; and (xi) other factors that may affect the future results of Huntington and Veritex.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• risks related to the concentration of our business in Texas, and specifically within the DFW metroplex and the Houston metropolitan area, including risks associated with any downturn in the real estate sector and risks associated with a decline in the values of single family homes in the DFW metroplex and the Houston metropolitan area;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• uncertain market conditions and economic trends nationally, regionally and particularly in the DFW metroplex and Texas;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the effects of regional or national civil unrest;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• significant changes to the size, structure, powers, and operations of the federal government and uncertainties regarding the potential for future changes;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the effects of war or other conflicts, including, but not limited to, the current conflicts between Russia and Ukraine and Israel and Hamas, acts of terrorism, cyber attacks or other catastrophic events, including natural disasters such as storms, droughts, fires, tornadoes, hurricanes and flooding, that may affect general economic conditions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• changes in market interest rates that affect the pricing of our loans and deposits and our net interest income;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• changes in U.S. trade policies, including the imposition of tariffs and retaliatory tariffs;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• risks related to our strategic focus on lending to small to medium-sized businesses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the sufficiency of the assumptions and estimates we make in establishing reserves for potential loan losses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to implement our growth strategy, including identifying and consummating suitable acquisitions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to recruit and retain successful bankers that meet our expectations in terms of customer relationships and profitability;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the impacts related to or resulting from bank failures and other volatility, including potential increased regulatory requirements and costs, such as FDIC special assessments, long-term debt requirements and heightened capital requirements, and potential impacts to macroeconomic conditions, which could affect the ability of depository institutions, including us, to attract and retain depositors and to borrow or raise capital;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• changes in our accounting policies, standards and interpretations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to retain executive officers and key employees and their customer and community relationships;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• risks associated with our CRE and construction loan portfolios, including the risks inherent in the valuation of the collateral securing such loans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• risks associated with our commercial loan portfolio, including the risk of deterioration in value of the general business assets that generally secure such loans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our level of nonperforming assets and the costs associated with resolving problem loans, if any, and complying with government-imposed foreclosure moratoriums;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• potential changes in the prices, values and sales volumes of commercial and residential real estate securing our real estate loans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• risks related to the significant amount of credit that we have extended to a limited number of borrowers and in a limited geographic area;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• changes in the financial performance and/or condition of our borrowers;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to maintain adequate liquidity and to raise necessary capital to fund our acquisition strategy and operations or to meet increased minimum regulatory capital levels;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• potential fluctuations in the market value and liquidity of our debt securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the effects of competition from a wide variety of local, regional, national and other providers of financial, investment and insurance services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to maintain an effective system of disclosure controls and procedures and internal control over financial reporting;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• risks associated with fraudulent and negligent acts by our customers, employees or vendors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to keep pace with technological change or difficulties when implementing new technologies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• risks associated with difficulties and/or terminations with third-party service providers and the services they provide;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• risks associated with unauthorized access, cyber-crime and other threats to data security;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• potential impairment on the goodwill we have recorded or may record in connection with business acquisitions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to comply with various governmental and regulatory requirements applicable to financial institutions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the impact of recent and future legislative and regulatory changes, including changes in banking, securities and tax laws and regulations and their application by our regulators, and economic stimulus programs;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• changes in consumer spending, borrowing and saving habits;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the potential impact of climate change;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the impact of pandemics, epidemics or any other health-related crisis;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the effects of and changes in governmental monetary and fiscal policies and laws, including the policies of the Federal Reserve;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to comply with supervisory actions by federal and state banking agencies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• changes in the scope and cost of FDIC, insurance and other coverage; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• systemic risks associated with the soundness of other financial institutions.

Other factors not identified above, including those described under the headings "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations," in our Annual Report on Form 10-K for the year ended December 31, 2024, may also cause actual results to differ materially from those described in our forward-looking statements. Most of these factors are difficult to anticipate and are generally beyond our control. Any forward-looking statement speaks only as of the date on which it is made. You should consider these factors in connection with considering any forward-looking statements that may be made by us. We undertake no obligation, and specifically decline any obligation, to publicly release any supplement, update or revision to any forward-looking statements, to report events or to report the occurrence of unanticipated events, whether as a result of new information, future developments or otherwise, unless we are required to do so by law.

**Item 3. Quantitative and Qualitative Disclosures About Market Risk**

As a financial institution, our primary component of market risk is interest rate volatility. Our asset, liability and funds management policy provides us with the guidelines for effective funds management. Additionally, we have an established measurement system for monitoring our net interest rate sensitivity position to ensure it is within set guidelines.

Fluctuations in interest rates will ultimately impact both the level of income and expense recorded on most of our assets and liabilities, as well as the market value of all interest-earning assets and interest-bearing liabilities, other than those with a short term to maturity. Interest rate risk is the potential for economic losses from future interest rate changes. The objective is to measure the effect of rate risk on net interest income and to manage the balance sheet to minimize the inherent risk while maximizing income.

We manage our exposure to interest rates by structuring our balance sheet in the ordinary course of business. With exception of our cash flow hedges designated as a hedging instrument, we do not enter into instruments such as leveraged derivatives, interest rate swaps, financial options, financial future contracts or forward delivery contracts for the purpose of reducing interest rate risk. We enter into interest rate swaps, caps and collars as an accommodation to our customers in connection with our interest rate swap program and minimize our exposure to those swaps through offsetting trades with bank counterparties. Based upon the nature of our operations, we are not subject to foreign exchange or commodity price risk. We do not own any trading assets.

Our exposure to interest rate risk is managed by the Asset-Liability Committee of the Bank in accordance with policies approved by its board of directors. The committee formulates strategies based on acceptable levels of interest rate risk, which are determined by considering the impact on earnings and capital of the current outlook on interest rates, potential changes in interest rates, regional economies, liquidity, business strategies and other factors. The committee meets regularly to review, among other things, the sensitivity of assets and liabilities to interest rate changes, the book and market values of assets and liabilities, unrealized gains and losses, purchase and sale activities, commitments to originate loans and the maturities of investments and borrowings. Additionally, the committee reviews liquidity, cash flow flexibility, maturities of deposits and consumer and commercial deposit activity. Management employs methodologies to manage interest rate risk, which include an analysis of relationships between interest-earning assets and interest-bearing liabilities, and an interest rate shock simulation model.

We use an interest rate risk simulation model and shock analysis to test the interest rate sensitivity of net interest income and the balance sheet, respectively. Contractual maturities and repricing opportunities of loans are incorporated in the model as are prepayment assumptions, maturity data and call options within the investment portfolio.

We utilize static balance sheet rate shocks to estimate the potential impact on net interest income of changes in interest

rates under various rate scenarios. This analysis estimates a percentage of change in the metric from the stable rate base scenario versus alternative scenarios of rising and falling market interest rates by instantaneously shocking a static balance sheet. Internal policy regarding internal rate risk simulations currently specifies that for instantaneous parallel shifts of the yield curve, estimated net income at risk for the subsequent one-year period should not decline by more than 5.0% for a 100 bps shift, 12.5% for a 200 bps shift, and 15.0% for a 300 bps shift.

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The following table summarizes the simulated change in net interest income and fair value of equity over a 12-month horizon as of the dates indicated:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **As of June 30, 2025** | **As of June 30, 2025** | **As of December 31, 2024** | **As of December 31, 2024** |
|<br>**Change in Interest**<br>**Rates (BPS)** | **Percent Change**<br>**in Net Interest**<br>**Income** | **Percent Change**<br>**in Fair Value**<br>**of Equity** | **Percent Change**<br>**in Net Interest**<br>**Income** | **Percent Change**<br>**in Fair Value**<br>**of Equity** |
| + 300 | 8.41% | (12.10)% | 7.60% | (9.24)% |
| + 200 | 6.06 | (7.51) | 5.51 | (5.14) |
| + 100 | 3.29 | (3.41) | 3.17 | (1.99) |
| Base |  |  |  |  |
| -100 | (2.78) | 0.34 | (2.55) | 0.43 |
| -200 | (5.52) | (2.63) | (10.01) | (6.48) |

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The results are primarily due to behavior of demand, money market and savings deposits during such rate fluctuations. We have found that, historically, interest rates on these deposits change more slowly than changes in the discount and Federal Funds Rates. This assumption is incorporated into the simulation model and is generally not fully reflected in a gap analysis. The assumptions incorporated into the model are inherently uncertain and, as a result, the model cannot precisely measure future net interest income or precisely predict the impact of fluctuations in market interest rates on net interest income. Actual results will differ from the model's simulated results due to timing, magnitude and frequency of interest rate changes as well as changes in market conditions and the application and timing of various strategies.

**Item 4. Controls and Procedures**

*Evaluation of disclosure controls and procedures* — As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of its management, including its CEO and CFO, of the effectiveness of the design and operation of its disclosure controls and procedures. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management was required to apply judgment in evaluating its controls and procedures. Based on this evaluation, the Company's CEO and CFO concluded that the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective as of the end of the period covered by this report.

There were no significant changes in the Company's internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

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**PART II. OTHER INFORMATION**

**Item 1. Legal Proceedings**

We are from time to time subject to claims and litigation arising in the ordinary course of business. These claims and litigation may include, among other things, allegations of violation of banking and other applicable regulations, competition law, labor laws and consumer protection laws, as well as claims or litigation relating to intellectual property, securities, breach of contract and tort. We intend to defend ourselves vigorously against any pending or future claims and litigation.

At this time, in the opinion of management, the likelihood is remote that the impact of such proceedings, either individually or in the aggregate, would have a material adverse effect on our consolidated results of operations, financial condition or cash flows. However, one or more unfavorable outcomes in any claim or litigation against us could have a material adverse effect for the period in which they are resolved. In addition, regardless of their merits or their ultimate outcomes, such matters are costly, divert management's attention and may materially adversely affect our reputation, even if resolved in our favor.

**Item 1A. Risk Factors**

In evaluating an investment in our common stock, investors should consider carefully, among other things, the risk factors previously disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024, as well as the information contained in this Quarterly Report on Form 10-Q and our other reports and registration statements filed with the SEC. See also "<u>[Cautionary Notice Regarding Forward-Looking Statements](#i99d8b0fb842e4018a10d7d1e55bdf145_151)</u>" disclosed in Part I, item 2 of this Quarterly Report on Form 10-Q.

Except as set forth below, there has been no material change in the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.

***Combining Huntington and Veritex may be more difficult, costly or time consuming than we expect.***

The success of the merger will depend, in part, on the ability to realize the anticipated cost savings from combining the businesses of Huntington and Veritex. To realize the anticipated benefits and cost savings from the merger, Huntington and Veritex must successfully integrate and combine their businesses in a manner that permits those cost savings to be realized. If Huntington and Veritex are not able to successfully achieve these objectives, the anticipated benefits of the merger may not be realized fully or at all or may take longer to realize than expected. In addition, the actual cost savings and anticipated benefits of the merger could be less than anticipated, and integration may result in additional unforeseen expenses.

Huntington and Veritex have operated and, until the completion of the merger, must continue to operate, independently. It is possible that the integration process could result in the loss of key employees, the disruption of each company's ongoing businesses or inconsistencies in standards, controls, procedures and policies that adversely affect the companies' ability to maintain relationships with clients, customers, depositors and employees or to achieve the anticipated benefits and cost savings of the merger. Integration efforts between the two companies may also divert management attention and resources. These integration matters could have an adverse effect on each of Huntington and Veritex during this transition period and for an undetermined period after completion of the merger on the combined company.

***Termination of the merger agreement could negatively affect Veritex****.* 

If the merger is not completed for any reason, including as a result of Veritex shareholders failing to approve the Veritex merger proposal, there may be various adverse consequences and Veritex may experience negative reactions from the financial markets and from their respective customers and employees. For example, Veritex's businesses may have been affected adversely by the failure to pursue other beneficial opportunities due to the focus of management on the merger, without realizing any of the anticipated benefits of completing the merger. Additionally, if the merger agreement is terminated, the market price of Veritex's common stock could decline to the extent that the current market prices reflect a market assumption that the merger will be completed. If the merger agreement is terminated under certain circumstances, Veritex may be required to pay a termination fee of $56 million to Huntington.

Additionally, Veritex has incurred and will incur substantial expenses in connection with the negotiation and completion of the transactions contemplated by the merger agreement, including legal, accounting and financial advisory costs. If the merger is not completed, Veritex would have to pay certain of these expenses without realizing the expected benefits of the merger.

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***Veritex will be subject to business uncertainties and contractual restrictions while the merger is pending.***

Uncertainty about the effect of the merger on employees and customers may have an adverse effect on Veritex. These uncertainties may impair Veritex's ability to attract, retain and motivate key personnel until the merger is completed, and could cause customers and others that deal with Veritex to seek to change existing business relationships with Veritex. In addition, subject to certain exceptions, Veritex has agreed to operate its business in the ordinary course prior to closing, and not to take certain actions which could cause Veritex to be unable to pursue other beneficial opportunities that may arise prior to the completion of the merger.

***The merger agreement limits Veritex's ability to pursue alternatives to the merger and may discourage other companies from trying to acquire Veritex.*** 

The merger agreement contains "no shop" covenants that restrict Veritex's ability to, directly or indirectly, initiate, solicit, knowingly encourage or knowingly facilitate any inquiries or proposals with respect to, engage or participate in any negotiations with any person concerning, provide any confidential or nonpublic information or data to, or have or participate in any discussions with, any person relating to, any acquisition proposal, subject to certain exceptions, or, during the term of the merger agreement, approve or enter into any letter of intent, memorandum of understanding, agreement in principle, acquisition agreement, merger agreement or other similar agreement relating to any acquisition proposal.

The merger agreement further provides that, during the twelve (12)-month period following the termination of the merger agreement under specified circumstances, including the entry into a definitive agreement or consummation of a transaction with respect to an alternative acquisition proposal, Veritex may be required to pay to Huntington a cash termination fee equal to $56 million.

These provisions could discourage a potential third-party acquirer that might have an interest in acquiring all or a significant portion of Veritex from considering or proposing that acquisition.

***The merger agreement subjects Veritex to certain restrictions on its business activities while the merger is pending.***

The merger agreement subjects the Veritex to certain restrictions on its business activities while the merger is pending. Subject to certain specified exceptions, the merger agreement obligates Veritex to, and to cause each of its subsidiaries to, conduct its business in the ordinary course in all material respects and use reasonable best efforts to maintain and preserve intact its business organization and advantageous business relationships, and to take no action that is intended or would be reasonably likely to adversely affect or materially delay the ability of either Huntington or Veritex to obtain any necessary approvals of any regulatory agency or other governmental entity required for the transactions contemplated by the merger agreement or to perform its respective covenants and agreements under the merger agreement or to consummate the transactions contemplated by the merger agreement on a timely basis. These restrictions could prevent Veritex from pursuing certain business opportunities that arise prior to the effective time.

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**Item 2. Unregistered Sales of Equity Securities and Use of Proceeds**

On March 26, 2024, the Board authorized a stock buyback program (the "Stock Buyback Program") pursuant to which the Company is authorized to purchase up to $50.0 million shares of the Company's outstanding common stock. On March 25, 2025, the Board authorized the extension of the Stock Buyback Program through March 31, 2026. The Stock Buyback Program may be suspended, terminated, amended or modified by the Board at any time without prior notice at the Board's discretion. Repurchases under the Stock Buyback Program may be made, from time to time, in amounts and at prices the Company deems appropriate. The Stock Buyback Program does not obligate the Company to purchase any shares of its common stock. Repurchases by the Company under the Stock Buyback Program will be subject to general market and economic conditions, applicable legal and regulatory requirements and other considerations. During the three months ended June 30, 2025, the Company repurchased shares of its common stock in the following amounts:

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| | | | | |
|:---|:---|:---|:---|:---|
| Period | Total number of shares purchased | Average price paid per share | Total number of shares purchased as part of publicly announced plans or programs | Approximate dollar value of shares that may yet be purchased under the program *(in thousands)* |
| Beginning balance |  |  |  | $36947 |
| April 1 - April 30, 2025 | 36000 | $23.15 | 36000 | 36113 |
| May 1 - May 31, 2025 | 169597 | 24.18 | 169597 | 32012 |
| June 1 - June 30, 2025 | 80694 | 24.22 | 80694 | 30057 |
| Quarterly totals and remaining $ balance available to repurchase | 286291 | $24.06 | 286291 | $30057 |

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**Item 6. Exhibits**

---

| | |
|:---|:---|
| **Exhibit<br>Number** | **Description of Exhibit** |
| <u>[2.1](https://www.sec.gov/Archives/edgar/data/1501570/000110465925068652/tm2520227d8_ex2-1.htm)</u> | <u>[Agreement and Plan of Merger, dated as of July 13, 2025, by and between Huntington Bancshares Incorporated and Veritex Holdings, Inc. (Exhibit 2.1 to Form 8-K filed on July 17, 2025 and incorporated herein by this reference).](https://www.sec.gov/Archives/edgar/data/1501570/000110465925068652/tm2520227d8_ex2-1.htm)</u> |
| <u>[3.1](https://www.sec.gov/Archives/edgar/data/1501570/000104746914007782/a2221492zex-3_1.htm)</u> | <u>[Restated Certificate of Formation (with Amendments) of Veritex Holdings, Inc. (incorporated herein by reference to Exhibit 3.1 to the Company's Registration Statement on Form S-1 (Registration No. 333-198484) filed September 22, 2014).](https://www.sec.gov/Archives/edgar/data/1501570/000104746914007782/a2221492zex-3_1.htm)</u> |
| <u>[3.2](https://www.sec.gov/Archives/edgar/data/1501570/000150157017000151/exhibit32q263017.htm)</u> | <u>[Third Amended and Restated Bylaws of Veritex Holdings, Inc. (incorporated by reference to Exhibit 3.2 to the Company's Quarterly Report on Form 10-Q filed July 25, 2017).](https://www.sec.gov/Archives/edgar/data/1501570/000150157017000151/exhibit32q263017.htm)</u> |
| <u>[10.1](https://www.sec.gov/Archives/edgar/data/1501570/000150157025000112/exhibit992-2025amendedandr.htm)</u> | <u>[2025 Amended and Restated Omnibus Incentive Plan for Veritex Holdings, Inc. (incorporated by reference to Exhibit 99.2 to the Company's Registration Statement on Form S-8 filed with the SEC on July 1, 2025)](https://www.sec.gov/Archives/edgar/data/1501570/000150157025000112/exhibit992-2025amendedandr.htm)</u> |
| <u>[31.1\*](a2025q2-exhibit311.htm)</u> | <u>[Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](a2025q2-exhibit311.htm)</u> |
| <u>[31.2\*](a2025q2-exhibit312.htm)</u> | <u>[Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](a2025q2-exhibit312.htm)</u> |
| <u>[32.1\*\*](a2025q-exhibit321.htm)</u> | <u>[Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.](a2025q-exhibit321.htm)</u> |
| <u>[32.2\*\*](a2025q2-exhibit322.htm)</u> | <u>[Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.](a2025q2-exhibit322.htm)</u> |
| 101\* | The following materials from Veritex Holdings, Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, formatted in Inline XBRL (Inline eXtensible Business Reporting Language): (i) Cover Page, (ii) Consolidated Balance Sheets, (iii) Consolidated Statements of Income, (iv) Consolidated Statements of Comprehensive Income, (v) Consolidated Statements of Changes in Stockholders' Equity, (vi) Consolidated Statements of Cash Flows, and (vii) Notes to Consolidated Financial Statements. |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |

---

______________________________

\* Filed with this Quarterly Report on Form 10-Q

\*\* Furnished with this Quarterly Report on Form 10-Q

The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure, other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.

------

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

---

| | |
|:---|:---|
| | **VERITEX HOLDINGS, INC.** |
| | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Registrant) |
| Date: August 1, 2025 | /s/ C. Malcolm Holland, III |
|  | C. Malcolm Holland, III |
|  | Chairman and Chief Executive Officer |
|  | (Principal Executive Officer) |
| Date: August 1, 2025 | /s/ William L. Holford |
|  | William L. Holford |
|  | Chief Financial Officer |
|  | (Principal Financial and Accounting Officer) |

---

## Exhibit 31.1

**EXHIBIT 31.1**

**CERTIFICATION**

I, C. Malcolm Holland, III, certify that:

1. I have reviewed this report on Form 10-Q of Veritex Holdings, Inc. for the period ended June 30, 2025;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 1, 2025

<u>/s/ C. Malcolm Holland, III</u>

C. Malcolm Holland, III

Chairman of the Board & Chief Executive Officer

## Exhibit 31.2

**EXHIBIT 31.2**

**CERTIFICATION**

I, William L. Holford, certify that:

1. I have reviewed this report on Form 10-Q of Veritex Holdings, Inc. for the period ended June 30, 2025;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 1, 2025

<u>/s/ William L. Holford</u>

William L. Holford

Chief Financial Officer

## Exhibit 32.1

**Exhibit 32.1**

**CERTIFICATION**

&nbsp;&nbsp;&nbsp;&nbsp;In connection with the report on Form 10-Q of Veritex Holdings, Inc. (the "Company") for the period ended June 30, 2025 (the "Report"), as filed with the Securities and Exchange Commission on the date hereof, I, C. Malcolm Holland, III, Chairman and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

<u>/s/ C. Malcolm Holland, III</u>

C. Malcolm Holland, III

Chairman of the Board & Chief Executive Officer

Date: August 1, 2025

## Exhibit 32.2

**Exhibit 32.2**

**CERTIFICATION**

&nbsp;&nbsp;&nbsp;&nbsp;In connection with the report on Form 10-Q of Veritex Holdings, Inc. (the "Company") for the period ended June 30, 2025 (the "Report"), as filed with the Securities and Exchange Commission on the date hereof, I, William L. Holford, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

<u>/s/ William L. Holford</u>

William L. Holford

Chief Financial Officer

Date: August 1, 2025

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