UNITED COMMUNITY BANKS INC

Previous wording

The following is a discussion of our financial condition at March 31, 2026 and December 31, 2025 and our results of operations for the three months ended March 31, 2026 and 2025. The purpose of this discussion is to focus on information about our financial condition and results of operations which is not otherwise apparent from our consolidated financial statements and is intended to provide insight into our results of operations and financial condition. The following discussion and analysis should be read along with our consolidated financial statements and related notes included in Part I - Item 1 of this Report, “Cautionary Note Regarding Forward-Looking Statements” beginning on page 4 of this Report and the risk factors discussed in our Item 1A. of our 2025 10-K and in Part II, Item IA. of this Report.

Current wording

The following is a discussion of our financial condition at June 30, 2026 and December 31, 2025 and our results of operations for the three and six months ended June 30, 2026 and 2025. The purpose of this discussion is to focus on information about our financial condition and results of operations which is not otherwise apparent from our consolidated financial statements and is intended to provide insight into our results of operations and financial condition. The following discussion and analysis should be read along with our consolidated financial statements and related notes included in Part I - Item 1 of this Report, “Cautionary Note Regarding Forward-Looking Statements” beginning on page 4 of this Report and the risk factors discussed in our Item 1A. of our 2025 10-K and in Part II, Item IA. of this Report.

Previous wording

We offer a wide array of commercial and consumer banking services and investment advisory solutions provided through a 200 banking office network throughout Georgia, South Carolina, North Carolina, Tennessee, Florida and Alabama. Our equipment finance and SBA/USDA lending businesses operate throughout the United States. At March 31, 2026, we had consolidated total assets of $28.2 billion and 3,118 full-time equivalent employees.

Current wording

We offer a wide array of commercial and consumer banking services and investment advisory solutions through a network of 200 banking offices in Georgia, South Carolina, North Carolina, Tennessee, Florida and Alabama. Our equipment finance and SBA/USDA lending businesses operate throughout the United States. At June 30, 2026, we had consolidated total assets of $29.1 billion and 3,141 full-time equivalent employees.

Previous wording

Subsequent to the end of the first quarter, on April 21, 2026, we entered into a definitive merger agreement to acquire Peach State Bancshares, Inc. and its wholly-owned subsidiary, Peach State Bank & Trust, headquartered in Gainesville, Georgia. As of March 31, 2026, Peach State Bank & Trust reported total assets of $788 million, with total loans of $498 million and total deposits of $713 million. We expect the merger to close in the third quarter of 2026. See Note 10 to the Notes of the Financial Statements for further detail.

Current wording

Subsequent to quarter end, on August 1, 2026, we closed on the previously announced acquisition of Peach State, headquartered in Gainesville, Georgia. As of June 30, 2026, Peach State Bank & Trust reported total assets of $786 million, with total loans of $523 million and total deposits of $707 million. We expect the merger will strengthen our existing presence in the Gainesville, Georgia MSA. See Note 13 in the Notes to the Financial Statements for further detail.

Previous wording

Results for the first quarter of 2026 are discussed in further detail throughout the following sections of MD&A.

Current wording

Results for the second quarter and first six months of 2026 are discussed in further detail throughout the following sections of MD&A.

Previous wording

The interest rate environment changes over the past year included aggregate reductions of 75 basis points in the federal funds rate, which drove decreases in funding costs, and to a lesser extent, loan yields. As a result, the primary driver in the increase in FTE net interest revenue for the first quarter of 2026 was a $20.9 million decrease in deposit interest expense. Interest revenue from interest-earning assets decreased $1.28 million. Loan interest revenue increased $12.7 million compared to the same period of 2025, mostly driven by loan growth, while securities interest revenue decreased $12.7 million due to both a lower average balances and a decrease in the average rate earned. The increase in net interest revenue for the first quarter of 2026 also reflects net interest revenue from the loans and deposits acquired in the ANB merger, which closed on May 1, 2025. The increase in net interest margin and net interest spread was primarily driven by a steeper decrease in average rates paid on deposits compared to the decrease in rates earned on loans.

Current wording

FTE net interest revenue for the second quarter of 2026 was $242 million, an increase of $15.6 million from the same period in 2025. Net interest spread and net interest margin were 2.93% and 3.68%, respectively, which were up 31 basis points and 18 basis points, respectively, compared to the second quarter of 2025. The interest rate environment changes over the past year included aggregate reductions of 75 basis points in the federal funds rate, which drove decreases in funding costs, and to a lesser extent, loan yields. As a result, the primary driver of the increase in FTE net interest revenue for the second quarter of 2026 from the second quarter of 2025 was a $21.0 million decrease in deposit interest expense. Interest revenue from interest-earning assets decreased $2.76 million from the second quarter of 2025. Loan interest revenue increased $8.26 million compared to the same period of 2025, mostly driven by loan growth, while securities interest revenue decreased $9.55 million due to both lower average balances and a decrease in the average rate earned.

Previous wording

(1)Interest revenue on tax-exempt securities and loans includes a taxable-equivalent adjustment to reflect comparable interest on taxable securities and loans. The FTE adjustment totaled $1.11 million and $991,000, respectively, for the three months ended March 31, 2026 and 2025. The tax rate used to calculate the adjustment was 25%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.

Current wording

(1)Interest revenue on tax-exempt securities and loans includes a taxable-equivalent adjustment to reflect comparable interest on taxable securities and loans. The FTE adjustment totaled $1.22 million and $983,000, respectively, for the three months ended June 30, 2026 and 2025. The tax rate used to calculate the adjustment was 25%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.

Previous wording

(3)Unrealized losses on AFS securities, including those related to the transfer from AFS to HTM, have been reclassified to other assets. Pretax unrealized losses of $176 million in 2026 and $269 million in 2025 are included in other assets for purposes of this presentation.

Current wording

(3)Unrealized losses on AFS securities, including those related to the reclassified from AFS to HTM, have been reclassified to other assets. Pretax unrealized losses of $191 million in 2026 and $240 million in 2025 are included in other assets for purposes of this presentation.

Previous wording

The increase in mortgage loan gains and related fees for the three months ended March 31, 2026 compared to the same period of 2025 was primarily a result of an increase in mortgage servicing income of $1.04 million, which includes fair value adjustments to our mortgage servicing asset. During the first quarter of 2026, we began an economic hedging strategy utilizing a trading securities portfolio, with the intention of offsetting the impact of the changes in the fair value of our mortgage servicing asset with the gains or losses on trading securities. During the first quarter of 2026, we recognized $1.07 million losses on trading securities, which is included in other noninterest income.

Current wording

The increase in mortgage loan gains and related fees for the three and six months ended June 30, 2026 compared to the same periods of 2025 was primarily a result of an increase in mortgage servicing income of $1.10 million and $2.14 million, respectively, which includes fair value adjustments to our mortgage servicing asset. During the first quarter of 2026, we began an economic hedging strategy utilizing a trading securities portfolio, with the intention of offsetting the impact of the changes in the fair value of our mortgage servicing asset with the gains or losses on trading securities. During the three and six months ended June 30, 2026, we recognized $904,000 and $1.98 million, respectively, in losses on trading securities, which is included in other noninterest income on the consolidated statements of income.

Previous wording

During the first quarter of 2026, other investment income reflects higher earnings on our fintech and limited partnership investments compared to the same period of 2025. Our other investment portfolio includes mutual funds, equity securities, fintech and other limited partnership investments. Gains and losses from these investments are generally unrealized.

Current wording

During the three and six months ended June 30, 2026, other investment income reflects higher earnings on our mutual fund portfolio and our fintech and limited partnership investments compared to the same periods of 2025. Our other investment portfolio includes mutual funds, equity securities, fintech and other limited partnership investments. Gains and losses from these investments are generally unrealized.

Previous wording

The increase in other noninterest income was primarily driven by the $5.18 million gain on the termination of an interest rate cap accounted for as a cash flow hedge of our $100 million subordinated debt, for which redemption notice was provided in the first quarter of 2026. The subordinated debt was subsequently redeemed on April 30, 2026.

Current wording

The increase in other noninterest income for the six months ended June 30, 2026 was primarily driven by the $5.18 million gain on the termination of an interest rate cap accounted for as a cash flow hedge of our $100 million subordinated debt, for which redemption notice was provided in the first quarter of 2026 and which was then subsequently redeemed on April 30, 2026.

Previous wording

We recorded provisions for credit losses of $10.9 million for the three months ended March 31, 2026, compared to $15.4 million for the same period of 2025. The amount of provision recorded in each period was the amount required such that the total ACL reflected the appropriate balance as determined by management reflecting expected life of loan losses. Additional discussion on credit quality and the ACL is included in the “Allowance for Credit Losses” section of MD&A in this Report.

Current wording

We recorded negative provisions for credit losses of $29.8 million and $19.0 million, respectively, for the three and six months ended June 30, 2026, compared to provision expense of $11.8 million and $27.2 million, respectively, for the same respective periods of 2025. The amount of provision recorded in each period was the amount required such that the total ACL reflected the appropriate balance as determined by management reflecting expected life of loan losses. The negative provisions for the three and six months ended June 30, 2026 reflect the reversal of the ACL related to the equipment financing portfolio, as substantially all of that portfolio was reclassified to held for sale during the second quarter of 2026. Additional discussion on credit quality and the ACL is included in the “Allowance for Credit Losses” section of MD&A in this Report.

Previous wording

The increase in salaries and employee benefits for the first quarter of 2026 compared to 2025 was mostly driven by the $6.70 million one-time payroll transition bonus described below, annual merit increases that went into effect on April 1, 2025, higher performance-related incentive compensation and the addition of ANB employees on May 1, 2025.

Current wording

The increase in salaries and employee benefits for the second quarter of 2026 compared to 2025 was mostly driven by an increase in salaries and higher performance-related incentive compensation as well as an increase in group medical expense. The increase in salaries was partly driven by annual merit increases that went into effect on April 1, 2026 and the increase in full-time equivalent employees. At June 30, 2026 and 2025 we had 3,141 and 3,050 full-time equivalent employees, respectively, an increase of 3%, reflecting our current strategic hiring plan. In addition to the factors impacting the quarter, the increase for the six months ended June 30, 2026 also reflects the $6.70 million first quarter one-time payroll transition bonus. The bonus was paid to bridge the gap in payroll dates due to the transition from a semi-monthly payroll cycle to a bi-weekly payroll cycle in arrears.

Previous wording

The decrease in FDIC assessments and other regulatory charges reflects a $1.89 million accrual reversal of the FDIC special assessment related to certain 2023 bank failures, as the FDIC announced it no longer intended to collect the remainder of the assessment. In addition, our assessment rate for the first quarter of 2026 decreased compared to the first quarter of 2025.

Current wording

The decrease in FDIC assessments and other regulatory charges for the six months ended June 30, 2026 reflects a $1.89 million accrual reversal of the FDIC special assessment related to certain 2023 bank failures, as the FDIC announced it no longer intended to collect the remainder of the assessment.

Previous wording

Our business purpose is to provide financial services and products to customers, which inherently comes with risk. We strive to manage, mitigate and optimize that risk appropriately. We maintain an enterprise risk framework that provides for the structure of the governance and oversight of our primary risk categories, which include credit, liquidity, market/interest rate, capital, strategic, operational, legal/compliance and reputation. The objective of our risk framework is to establish a formal structure for identifying, assessing, managing, monitoring and reporting risks in order to assist the Bank in achieving its strategic objectives.

Current wording

Our business purpose is to provide financial services and products to customers, which inherently comes with risk. We strive to manage, mitigate and optimize that risk appropriately. We maintain an enterprise risk framework that provides structure of the governance and oversight of our primary risk categories, which include credit, liquidity, market/interest rate, capital, strategic, operational, legal/compliance and reputation. The objective of our risk framework is to establish a formal structure for identifying, assessing, managing, monitoring and reporting risks in order to assist the Bank in achieving its strategic objectives.

Previous wording

The following discussion of our financial results and activities for the periods covered by this Report are grouped into their most relevant risk categories of Credit Risk Management, Liquidity Risk Management, Market / Interest Rate Risk Management and

Current wording

The following discussion of our financial results and activities for the periods covered by this Report are grouped into their most relevant risk categories of Credit Risk Management, Liquidity Risk Management, Market / Interest Rate Risk Management and Capital Risk Management. For more information on our risks, see Item 1A. Risk Factors and the Managing Risk section in MD&A of the 2025 10-K.

Previous wording

As of March 31, 2026, loans totaled $19.6 billion, compared to $19.4 billion at December 31, 2025. The increase was primarily driven by organic loan growth, particularly in our commercial portfolio.

Current wording

As of June 30, 2026, loans held for investment totaled $18.0 billion, compared to $19.4 billion at December 31, 2025. The decrease was primarily due to the reclassification, following the decision to sell Navitas, of $1.91 billion of equipment financing receivables to held for sale in the second quarter of 2026, representing substantially all of that portfolio. The remainder of equipment financing receivables retained were reclassified to the commercial and industrial category, as equipment financing no longer represents a significant category of loans held for investment. Excluding equipment financing receivables reclassified as held for sale, loans increased $457 million, or 3%, from December 31, 2025 representing organic loan growth, particularly in our commercial portfolio. We continue to focus on organic loan growth and have seen loan growth begin to accelerate during the second quarter of 2026. One of the key initiatives implemented by Management is the onboarding of experienced and proven revenue producers whereby over 35 such producers have been added since the third quarter of 2025.

Previous wording

The ACL for loans at March 31, 2026 totaled $208 million compared to $210 million at December 31, 2025 and the ACL for loans as a percentage of total loans decreased slightly to 1.06% from 1.09%. The decrease in the ACL was primarily attributable to a more positive economic forecast at March 31, 2026 compared to December 31, 2026. Our ACL for unfunded commitments, which totaled $17.6 million, increased $2.51 million compared to December 31, 2025 mostly due to an increase in our construction commitments.

Current wording

The ACL for loans at June 30, 2026 totaled $169 million compared to $210 million at December 31, 2025 and the ACL for loans as a percentage of total loans held for investment decreased to 0.94% from 1.09%. The decrease in the ACL was primarily attributable to the release of the ACL on the equipment financing loans reclassified to held for sale during June of 2026. As the equipment financing loans have a higher projected loss rate, the ACL coverage ratio decreased in correlation with the release of the ACL on those loans. The ACL for the remainder of the loan portfolio increased approximately 3%, mostly due to loan growth. Our ACL for unfunded commitments, which totaled $19.6 million, increased $4.53 million compared to December 31, 2025, due to an increase in our construction commitments combined with a higher modeled loss rate.

Previous wording

The table below summarizes NPAs for the periods indicated. NPAs include nonaccrual loans, OREO and repossessed assets. The main driver of the increase in nonaccrual loans since December 31, 2025 was a small population of larger owner-occupied CRE loans moving to nonaccrual during the first quarter of 2026.

Current wording

The table below summarizes NPAs for the periods indicated. NPAs include nonaccrual loans, OREO and repossessed assets. The main driver of the increase in nonaccrual loans since December 31, 2025 was a small population of larger owner-occupied CRE loans moving to nonaccrual during the first six months of 2026.

Previous wording

Commercial loans make up 75% of our loan portfolio, which includes owner occupied and income producing real estate, commercial and industrial, commercial construction and land and equipment financing loans.

Current wording

Commercial loans make up 73% of our loan portfolio, which as of June 30, 2026, includes owner occupied and income producing real estate, commercial and industrial and commercial construction and land.

Previous wording

Approximately 75% of our loan portfolio is secured by real estate and therefore, can be affected by changes in real estate valuation.

Current wording

Approximately 83% of our loan portfolio is secured by real estate and therefore, can be affected by changes in real estate valuation.

Previous wording

The Bank’s main source of liquidity is customer deposit accounts. Liquidity is also available from cash and cash equivalents and wholesale funding sources consisting primarily of Federal funds purchased, securities sold under agreements to repurchase, FHLB advances and brokered deposits. Wholesale funding instruments are generally short-term in nature and used as necessary to fund asset growth and meet other short-term liquidity needs. At the end of 2025 and through most of the first quarter of 2026, due to loan growth and some seasonal deposit attrition, we utilized modest short-term borrowings to meet short-term funding needs. At December 31, 2025, we had $85.0 million of outstanding federal funds purchased. By March 31, 2026, we were able to meet our funding needs without the use of wholesale borrowings and had no outstanding short-term borrowings at quarter-end. Our loan and securities portfolios also provide liquidity primarily through loan principal and interest payments and the maturities and sales of securities, as well as the ability to use these assets as collateral for borrowings on a secured basis.

Current wording

The Bank’s main source of liquidity is customer deposit accounts. Liquidity is also available from cash and cash equivalents and wholesale funding sources consisting primarily of Federal funds purchased, securities sold under agreements to repurchase, FHLB advances and brokered deposits. Wholesale funding instruments are generally short-term in nature and used as necessary to fund asset growth and meet other short-term liquidity needs. Our loan and securities portfolios also provide liquidity primarily through loan principal and interest payments and the maturities and sales of securities, as well as the ability to use these assets as collateral for borrowings on a secured basis.

Previous wording

Customer deposits are the primary source of funds for the continued growth of our earning assets. We believe our high level of service, as evidenced by our strong customer satisfaction scores, is instrumental in attracting and retaining customer deposit accounts. Since December 31, 2025, customer deposits increased $237 million, primarily driven by the increase in noninterest demand deposits. As of March 31, 2026, we had approximately $10.1 billion of uninsured deposits, of which $2.99 billion was collateralized by investment securities.

Current wording

Customer deposits are the primary source of funds for the continued growth of our earning assets. We believe our high level of service, as evidenced by our strong customer satisfaction scores, is instrumental in attracting and retaining customer deposit accounts. Since December 31, 2025, customer deposits decreased $57.6 million, mostly due to a seasonal decrease in public funds, partially offset by an increase in noninterest bearing demand balances. As of June 30, 2026, we had approximately $9.48 billion of uninsured deposits, of which $2.79 billion was collateralized by investment securities.

Previous wording

At March 31, 2026, HTM debt securities had a fair value of $1.88 billion, indicating net unrealized losses of $333 million (pre-tax). Additional unrealized losses on HTM debt securities of $50.0 million (pre-tax) were included in AOCI as a result of the transfer of AFS debt securities to HTM in 2022. Unrealized losses were primarily attributable to changes in interest rates.

Current wording

At June 30, 2026, HTM debt securities had a fair value of $1.85 billion, indicating net unrealized losses of $330 million (pre-tax). Additional unrealized losses on HTM debt securities of $48.2 million (pre-tax) were included in AOCI as a result of the reclassification of certain AFS debt securities to HTM in 2022. Unrealized losses were primarily attributable to changes in interest rates.

Previous wording

At March 31, 2026 and December 31, 2025, we had long-term debt outstanding of $121 million and $120 million, respectively, which includes subordinated debentures and trust preferred securities. During the first quarter of 2026, holders of our $100 million subordinated debentures were notified that the debt would be redeemed prior to maturity, on April 30, 2026. At March 31, 2026 there were no short-term borrowings outstanding, compared to $85.0 million at December 31, 2025. The need to utilize wholesale funding sources has decreased because our liquidity needs have been met by our deposit and cash balances.

Current wording

At June 30, 2026 and December 31, 2025, the Holding Company had long-term debt outstanding of $20.6 million and $120 million, respectively, which includes trust preferred securities and, as of December 31, 2025, also includes subordinated debt. On April 30, 2026, we redeemed our $100 million in principal amount of subordinated debentures prior to maturity. At June 30, 2026, the Bank had $360 million in short-term borrowings outstanding, compared to $85.0 million at December 31, 2025. The Bank also had $800 million in FHLB advances at June 30, 2026. In the second quarter we utilized wholesale funding sources to facilitate securities purchases, as discussed above, and fund loan growth.

Previous wording

The maintenance and management of capital levels is one of management’s significant priorities. We are committed to maintaining a capital position that will support ongoing operations and achieve our strategic objectives. The ALCO and the Board are responsible for establishing capital adequacy risk ranges that are appropriate given the risks to which we are exposed and the environment in which we operate. Current and projected capital levels are compared to the capital adequacy risk ranges and reported quarterly to the ALCO and the Board. We utilize a baseline capital forecast as part of our capital management and planning process to evaluate current and future capital needs. We also use hypothetical stressed scenarios and sensitivity analyses, based on changing economic conditions and scenarios, including potential merger and acquisition transactions and debt/capital market activities. Forecasting alternative capital scenarios helps inform overall capital adequacy and capital ranges.

Current wording

The maintenance and management of capital levels are significant priorities of management. We are committed to maintaining a capital position that will support ongoing operations and the achievement of our strategic objectives. The ALCO and the Board are responsible for establishing capital adequacy risk ranges that are appropriate given the risks to which we are exposed and the environment in which we operate. Current and projected capital levels are compared to capital adequacy risk ranges and reported quarterly to the ALCO and the Board. We utilize a baseline capital forecast as part of our capital management and planning process to evaluate current and future capital needs. We also use hypothetical stressed scenarios and sensitivity analyses, based on changing economic conditions and scenarios, including potential merger and acquisition transactions and debt/capital market activities. Forecasting alternative capital scenarios helps inform overall capital adequacy and capital ranges.

Previous wording

Shareholders’ equity at March 31, 2026 was $3.65 billion, an increase of $16.0 million from December 31, 2025 primarily due to year-to-date earnings of $84.3 million, partially offset by common stock repurchases of $37.4 million and dividends declared on common stock of $30.4 million.

Current wording

Shareholders’ equity at June 30, 2026 was $3.75 billion, an increase of $106 million from December 31, 2025 primarily due to year-to-date earnings of $200 million, partially offset by common stock repurchases of $37.4 million and dividends declared on common stock of $60.8 million.

Previous wording

The following table shows capital composition as of March 31, 2026 and December 31, 2025.

Current wording

The following table shows capital composition as of June 30, 2026 and December 31, 2025. The decrease in Tier 2 capital instruments reflects the redemption of the $100 million subordinated debenture in the second quarter of 2026, which was subject to phase-out provisions as it approached maturity.