Atlantic Union Bankshares Corp

Previous wording

Certain statements in this Quarterly Report may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that include, without limitation, statements regarding the recently completed acquisition of Sandy Spring, including expectations with regard to the benefits of the Sandy Spring acquisition; statements regarding our future ability to recognize the benefits of certain tax assets; statements regarding our business, financial and operating results, including our deposit base and funding; the impact of changes in economic conditions, anticipated changes in the interest rate environment and the related impacts on our net interest margin, changes in economic, fiscal or trade policy and the potential impacts on our business, loan demand and economic conditions in our markets and nationally; management’s beliefs regarding our liquidity, capital resources, asset quality, CRE loan portfolio and our customer relationships; and statements that include other projections, predictions, expectations, or beliefs about future events or results or otherwise are not statements of historical fact. Such forward-looking statements are based on certain assumptions as of the time they are made, and are inherently subject to known and unknown risks, uncertainties, and other factors, some of which cannot be predicted or quantified, that may cause actual results, performance, or achievements to be materially different from those expressed or implied by such forward-looking statements. Forward-looking statements are often characterized by the use of qualified words (and their derivatives) such as “expect,” “believe,” “estimate,” “plan,” “project,” “anticipate,” “intend,” “will,” “may,” “view,” “opportunity,” “seek to,” “potential,” “continue,” “confidence,” or words of similar meaning or other statements concerning opinions or judgment of the Company and our management about future events. Although we believe that our expectations with respect to forward-looking statements are based upon reasonable assumptions within the bounds of our existing knowledge of our business and operations, there can be no assurance that actual future results, performance, or achievements of, or trends affecting, us will not differ materially from any projected future results, performance, achievements or trends expressed or implied by such forward-looking statements. Actual future results, performance, achievements or trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to, the effects of or changes in

Current wording

Certain statements in this Quarterly Report may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that include, without limitation, statements regarding the acquisition of Sandy Spring, including expectations with regard to the benefits of the Sandy Spring acquisition; statements regarding our future ability to recognize the benefits of certain tax assets; statements regarding our business, financial and operating results, including our deposit base and funding; the impact of changes in economic conditions, anticipated changes in the interest rate environment and the related impacts on our net interest margin, changes in economic, fiscal or trade policy and the potential impacts on our business, loan demand and economic conditions in our markets and nationally; management’s beliefs regarding our liquidity, capital resources, asset quality, CRE loan portfolio and our customer relationships; and statements that include other projections, predictions, expectations, or beliefs about future events or results or otherwise are not statements of historical fact. Such forward-looking statements are based on certain assumptions as of the time they are made, and are inherently subject to known and unknown risks, uncertainties, and other factors, some of which cannot be predicted or quantified, that may cause actual results, performance, or achievements to be materially different from those expressed or implied by such forward-looking statements. Forward-looking statements are often characterized by the use of qualified words (and their derivatives) such as “expect,” “believe,” “estimate,” “plan,” “project,” “anticipate,” “intend,” “will,” “may,” “view,” “opportunity,” “seek to,” “potential,” “continue,” “confidence,” or words of similar meaning or other statements concerning opinions or judgment of the Company and our management about future events. Although we believe that our expectations with respect to forward-looking statements are based upon reasonable assumptions within the bounds of our existing knowledge of our business and operations, there can be no assurance that actual future results, performance, or achievements of, or trends affecting, us will not differ materially from any projected future results, performance, achievements or trends expressed or implied by such forward-looking statements. Actual future results, performance, achievements or trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to, the effects of or changes in

Previous wording

Headquartered in Richmond, Virginia, Atlantic Union Bankshares Corporation (NYSE: AUB) is the holding company for Atlantic Union Bank. Atlantic Union Bank has branches and ATMs located in Virginia, Maryland and North Carolina. Certain non-bank financial services affiliates of Atlantic Union Bank include: Atlantic Union Equipment Finance, Inc., which provides equipment financing; Atlantic Union Financial Consultants, LLC, which provides brokerage services; and Union Insurance Group, LLC, which offers various lines of insurance products.

Current wording

Headquartered in Richmond, Virginia, Atlantic Union Bankshares Corporation (NYSE: AUB) is the holding company for Atlantic Union Bank. Atlantic Union Bank has branches and ATMs located in Virginia, Maryland, North Carolina and Washington D.C. Certain non-bank financial services affiliates of Atlantic Union Bank include: Atlantic Union Equipment Finance, Inc., which provides equipment financing; Atlantic Union Financial Consultants, LLC, which provides brokerage services; and Union Insurance Group, LLC, which offers various lines of insurance products.

Previous wording

On April 1, 2025, we completed our merger with Sandy Spring, the bank holding company for Sandy Spring Bank. Sandy Spring’s results of operations are included in our consolidated results since the date of acquisition, and therefore, our second quarter and first half of 2025 results reflect increased levels of average balances, net interest income, noninterest income and noninterest expense compared to prior quarter and first half of 2024 results.

Current wording

On April 1, 2025, we completed our merger with Sandy Spring, the bank holding company for Sandy Spring Bank, and we successfully completed the integration of Sandy Spring branches and operations on October 14, 2025. Sandy Spring’s results of operations are included in our consolidated results since the date of acquisition, and therefore, our third quarter and first nine months of 2025 results reflect increased levels of average balances, net interest income, noninterest income and noninterest expense compared to our results for the corresponding periods in 2024.

Previous wording

We are continually monitoring the impact of various global and national events on our results of operations and financial condition, including changes in economic conditions, such as inflation and recessionary conditions, changes in market interest rates, geopolitical conflicts, deposit competition, liquidity strains, changes in government policy, including changes in, or the imposition of, tariffs and/or trade barriers, and changes in legislative or regulatory requirements. The timing and impact of such events on our results of operation and financial condition will depend on future developments, which are highly uncertain and difficult to predict. In July 2025, the One Big Beautiful Bill Act was signed into law, which includes a broad range of tax reform provisions affecting businesses, including extending and modifying certain key provisions from the Tax Cuts and Jobs Act of 2017 and expanding certain incentives from the Inflation Reduction Act of 2022 while accelerating the phase-out of others. We are still evaluating the impact on our income tax expense and taxes payable from the tax provisions of the One Big Beautiful Bill Act.

Current wording

We are continually monitoring the impact of various global and national events on our results of operations and financial condition, including changes in economic conditions, such as inflation and recessionary conditions, changes in the unemployment rate, changes in market interest rates, the U.S. government shutdown, geopolitical conflicts, deposit competition, liquidity strains, changes in government policy, including changes in, or the imposition of, tariffs and/or trade barriers, and changes in legislative or regulatory requirements. The timing and impact of such events on our results of operation and financial condition will depend on future developments, which are highly uncertain and difficult to predict. In July 2025, the One Big Beautiful Bill Act was signed into law, which included a broad range of tax reform provisions affecting businesses, including extending and modifying certain key provisions from the Tax Cuts and Jobs Act of 2017 and expanding certain incentives from the Inflation Reduction Act of 2022 while accelerating the phase-out of others. The tax provisions of the One Big Beautiful Bill Act did not have a material impact on our tax balances.

Previous wording

In the first half of 2025, financial markets, international relations and global supply chains were impacted by changes and developments in U.S. trade policies and practices, including tariffs. Due to the rapidly evolving state of U.S. trade policies, the amount and duration of any tariffs and their ultimate impact on us, our customers, financial markets and the U.S. and global economies is currently uncertainty. However, there is a risk that these policy changes could have a negative impact on certain of our customers causing increased difficulty in repaying their loans or other obligations which could result in a higher level of credit losses in our loan portfolios with a corresponding impact on our results of operations. In addition, increased and prolonged economic uncertainty, the potential for elevated tariff levels or their wide-spread use in U.S. trade policies, as well as related tensions caused by such tariffs, could adversely affect the U.S. and global economies and financial markets, including by increasing inflation and leading to a slowdown of future economic growth and ultimately recessionary conditions.

Current wording

In the first nine months of 2025, financial markets, international relations and global supply chains were impacted by changes and developments in U.S. trade policies and practices, including tariffs. Due to the rapidly evolving state of U.S. trade policies, the amount and duration of any tariffs and their ultimate impact on us, our customers, financial markets and the U.S. and global economies is currently uncertain. However, there is a risk that these policy changes, as well as the U.S. government shutdown, could have a negative impact on certain customers causing increased difficulty in repaying their loans or other obligations which could result in a higher level of credit losses in our loan portfolios with a corresponding impact on our results of operations. In addition, increased and prolonged economic uncertainty, the U.S. government shutdown, changes in the unemployment rate, the potential for elevated tariff levels or their wide-spread use in U.S. trade policies, as well as related tensions caused by such tariffs, could adversely affect the U.S. and global economies and financial markets, including by increasing inflation and leading to a slowdown of future economic growth and ultimately recessionary conditions.

Previous wording

Inflation eased substantially in 2024, but it was estimated at 2.7% as of June 2025, which is still over the FOMC’s 2.0% target. In late 2024, the Federal Reserve shifted its interest rate policy as inflationary pressure began to ease and economic growth moderated, lowering rates three times between September and December in 2024, which resulted in the current Federal Funds target rate range of 4.25% to 4.50%. While the FOMC, has maintained the Federal Funds target rate range at 4.25% to 4.50% so far in 2025, with uncertainty elevated over the potential impacts of changes in U.S. and global trade and other economic policies and tensions, it is difficult to predict how the Federal Reserve will balance possible inflationary pressure with the potential of slower economic growth.

Current wording

In September 2025, the FOMC reduced the target range for the Federal Funds rate by 25 bps to 4.00% to 4.25%, marking its first policy rate cut since December 2024, in response to slowing job growth, higher unemployment, and signs of moderating economic growth activity. In October 2025, the FOMC further reduced the target range for the Federal Funds rate by 25 bps to 3.75% to 4.00%. The FOMC noted that inflation remains somewhat elevated, but its decision reflects a shift in its balance of risks, as unemployment rates have risen. With continued uncertainty over the potential impacts of changes in U.S. and global trade and other economic policies and tensions, it is difficult to predict how the Federal Reserve will balance possible inflationary pressure with the potential of slower economic growth and rising risks in employment, as well as the impacts of the U.S. government shut down.

Previous wording

In 2024, the higher-for-longer interest rate environment and heightened competition for deposits led to a shift within deposit composition toward higher cost products, which has continued through the first half of 2025, although the pace of movement slowed in late 2024 and so far in 2025. The interest rate environment has also affected the affordability of credit to consumers and businesses, moderating loan demand. At June 30, 2025, our LHFI, total deposits, and total borrowings increased from December 31, 2024 by $8.9 billion, $10.6 billion, and $358.2 million, respectively, primarily due to the Sandy Spring acquisition. At June 30, 2025, noninterest bearing deposits comprised 22.7% of total deposits, compared to 21.0% at December 31, 2024. As of June 30, 2025, we estimate that approximately 68.0% of our deposits were insured or collateralized, and that we maintained available liquidity sources to cover approximately 157.2% of uninsured and uncollateralized deposits. At June 30, 2025, our brokered deposits decreased by $54.3 million to $1.2 billion from December 31, 2024.

Current wording

In 2024, the higher-for-longer interest rate environment and heightened competition for deposits led to a shift within deposit composition toward higher cost products, which continued into 2025. The interest rate environment has also affected the affordability of credit to consumers and businesses, moderating loan demand. At September 30, 2025, our LHFI, total deposits, and total borrowings increased from December 31, 2024 by $8.9 billion, $10.3 billion, and $325.7 million, respectively, primarily due to the Sandy Spring acquisition. At September 30, 2025, noninterest bearing deposits comprised 23.2% of total deposits, compared to 21.0% at December 31, 2024. As of September 30, 2025, we estimate that approximately 68.0% of our deposits were insured or collateralized, and that we maintained available liquidity sources to cover approximately 156.8% of uninsured and uncollateralized deposits. At September 30, 2025, our brokered deposits decreased by $170.4 million to $1.0 billion from December 31, 2024.

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Second Quarter Net Income & Performance Metrics

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Third Quarter Net Income & Performance Metrics

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First Six Months Net Income & Performance Metrics

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First Nine Months Net Income & Performance Metrics

Previous wording

The following tables show interest income on earning assets and related average yields, as well as interest expense on interest-bearing liabilities and related average rates paid for the three and six months ended June 30, (dollars in thousands):

Current wording

The following tables show interest income on earning assets and related average yields, as well as interest expense on interest-bearing liabilities and related average rates paid for the three and nine months ended September 30, (dollars in thousands):

Previous wording

For the second quarter of 2025, our net interest income was $321.4 million, an increase of $136.8 million from the second quarter of 2024, and our net interest income (FTE)(+) was $325.7 million, an increase of $137.4 million from the second quarter of 2024. The increases were the result of a $12.2 billion increase in average interest earning assets due primarily to the addition of Sandy Spring acquired loans and the impact of loan accretion income related to acquisition accounting, as well as organic loan growth, and lower cost of funds, partially offset by a $9.0 billion increase in average interest-bearing liabilities due primarily to the addition of Sandy Spring acquired deposits and borrowings and the associated net amortization related to acquisition accounting.

Current wording

For the third quarter of 2025, our net interest income was $319.2 million, an increase of $136.3 million from the third quarter of 2024, and our net interest income (FTE)(+) was $323.6 million, an increase of $136.8 million from the third quarter of 2024. The increases were primarily the result of a $11.6 billion increase in average interest earning assets due primarily to the addition of Sandy Spring acquired loans and the impact of loan accretion income related to acquisition accounting, as well as organic loan growth, and lower cost of funds, reflecting the impact of the Federal Reserve lowering the Federal Funds target rates by 100 basis points from September 2024 to December 2024 and by another 25 basis points in September 2025. These increases were partially offset by a $8.3 billion increase in average interest-bearing liabilities due primarily to the addition of Sandy Spring acquired deposits and borrowings and the associated net amortization related to acquisition accounting.

Previous wording

In the second quarter of 2025, our net interest margin increased 39 bps to 3.78% from 3.39% in the second quarter of 2024, and our net interest margin (FTE)(+) increased 37 bps to 3.83% in the second quarter of 2025 from 3.46% for the same period of 2024. The increases were primarily driven by the net accretion of purchase accounting adjustments on loans, deposits, and long-term borrowings related to the Sandy Spring acquisition.

Current wording

In the third quarter of 2025, our net interest margin increased 46 bps to 3.77% from 3.31% in the third quarter of 2024, and our net interest margin (FTE)(+) increased 45 bps to 3.83% in the third quarter of 2025 from 3.38% for the same period of 2024. The increases were primarily driven by the lower cost of funds, reflecting the impact of the Federal Reserve lowering the Federal Funds rates by 100 basis points from September 2024 to December 2024 and by another 25 basis points in September 2025, and higher net accretion of purchase accounting adjustments on loans, deposits, and long-term borrowings, related to the Sandy Spring acquisition. Our cost of funds decreased by 39 basis points to 2.17% for the three months ended September 30, 2025, compared to the same period in the prior year, primarily due to a lower cost of deposits, resulting from lower balances in higher costing brokered deposits, and a decrease in our borrowing costs due to lower short-term FHLB advances.

Previous wording

Our net interest margin and net interest margin (FTE)(+) includes the impact of acquisition accounting fair value adjustments. Net accretion income related to acquisition accounting was $45.4 million for the second quarter of 2025 compared to $14.3 million for the second quarter of 2024, an increase of $31.1 million primarily due to the impacts from the Sandy Spring acquisition. The impact of accretion and amortization for the periods presented are reflected in the following table (dollars in thousands):

Current wording

Our net interest margin and net interest margin (FTE)(+) includes the impact of acquisition accounting fair value adjustments. Net accretion income related to acquisition accounting was $41.9 million for the third quarter of 2025 compared to $12.7 million for the third quarter of 2024, an increase of $29.2 million primarily due to the impacts from the Sandy Spring acquisition. The impact of accretion and amortization for the periods presented are reflected in the following table (dollars in thousands):

Previous wording

For the first six months of 2025 net interest income was $505.5 million, an increase of $173.2 million from the same period of 2024, and our net interest income (FTE)(+) was $513.7, an increase of $173.8 million from the same period of 2024. The increases in both net interest income and net interest income (FTE)(+) were primarily the result of a $7.6 billion increase in average interest earning assets, partially offset by a $5.7 billion increase in average interest-bearing liabilities, in each case primarily related to the Sandy Spring acquisition, as well as organic loan growth and lower cost of funds.

Current wording

For the first nine months of 2025 net interest income was $824.7 million, an increase of $309.5 million from the same period of 2024, and our net interest income (FTE)(+) was $837.3, an increase of $310.6 million from the same period of 2024. The increases in both net interest income and net interest income (FTE)(+) were primarily the result of a $9.0 billion increase in average interest earning assets, partially offset by a $6.6 billion increase in average interest-bearing liabilities, in each case primarily related to the Sandy Spring acquisition, as well as organic loan growth and lower cost of funds, reflecting the impact of the Federal Reserve lowering the Federal Funds rates by 100 basis points from September 2024 to December 2024 and by another 25 basis points in September 2025.

Previous wording

For the first six months of 2025, our net interest margin increased 36 bps to 3.62% and our net interest margin (FTE)(+) increased 35 bps to 3.68%, compared to the first six months of 2024. The increases were primarily driven by the higher earning asset yields which increased due to higher loan accretion, primarily driven by the Sandy Spring acquisition, as well as organic loan growth. Our cost of funds decreased by 24 basis points to 2.23% for the six months ended June 30, 2025, compared to the same period in the prior year, primarily due to a lower cost of deposits and a decrease in our short-term borrowings, partially offset by an increase in net amortization related to acquisition accounting and an increase in long-term subordinated debt with higher borrowing costs, both as a result of the Sandy Spring acquisition.

Current wording

For the first nine months of 2025, our net interest margin increased 40 bps to 3.68% and our net interest margin (FTE)(+) increased 38 bps to 3.73%, compared to the first nine months of 2024. The increases were primarily driven by the lower cost of funds, reflecting the impact of the Federal Reserve lowering the Federal Funds rates by 100 basis points from September 2024 to December 2024 and by another 25 basis points in September 2025, and higher earning asset yields which increased due to higher loan accretion, primarily driven by the Sandy Spring acquisition, as well as organic loan growth. Our cost of funds decreased by 29 basis points to 2.21% for the nine months ended September 30, 2025, compared to the same period in the prior year, due to a lower cost of deposits primarily due to the Federal Funds rate cuts discussed above, and a decrease in our short-term borrowings, partially offset by an increase in net amortization related to acquisition accounting and an increase in long-term subordinated debt with higher borrowing costs, both as a result of the Sandy Spring acquisition.

Previous wording

The following table shows interest income on earning assets and related average yields as well as interest expense on interest-bearing liabilities and related average rates paid for the three and six months ended June 30, (dollars in thousands):

Current wording

The following table shows interest income on earning assets and related average yields as well as interest expense on interest-bearing liabilities and related average rates paid for the three and nine months ended September 30, (dollars in thousands):

Previous wording

The Volume Rate Analysis table below presents changes in our net interest income (FTE)(+) and interest expense and distinguishes between the changes related to increases or decreases in our average outstanding balances of interest-earning assets and interest-bearing liabilities (volume), and the changes related to increases or decreases in average interest rates on such assets and liabilities (rate). Changes attributable to both volume and rate have been allocated proportionally. Results, on a taxable equivalent basis, are as follows for the three and six months ended June 30, (dollars in thousands):

Current wording

The Volume Rate Analysis table below presents changes in our net interest income (FTE)(+) and interest expense and distinguishes between the changes related to increases or decreases in our average outstanding balances of interest-earning assets and interest-bearing liabilities (volume), and the changes related to increases or decreases in average interest rates on such assets and liabilities (rate). Changes attributable to both volume and rate have been allocated proportionally. Results, on a taxable equivalent basis, are as follows for the three and nine months ended September 30, (dollars in thousands):

Previous wording

Our adjusted operating noninterest income,(+) which excludes the pre-tax gain on CRE loan sale ($15.7 million in the second quarter 2025), pre-tax gain on sale of our equity interest in CSP ($14.3 million in the second quarter 2025), and pre-tax gains and losses on sale of securities (gains of $16,000 in the second quarter 2025 and losses of $6.5 million in the second quarter 2024), increased $21.2 million or 69.8% to $51.5 million for the quarter ended June 30, 2025, compared to $30.3 million for the quarter ended June 30, 2024. The increase in adjusted operating noninterest income(+) was primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the $10.8 million increase in fiduciary and asset management fees, due to assets under management increasing approximately 120%, and the $3.1 million increase in service charges on deposit accounts. In addition to the acquisition impact, the BOLI income increase of $3.5 million includes death benefits of $2.4 million received in the second quarter of 2025 and the mortgage banking income increase of $1.6 million includes the impact of Sandy Spring’s mortgage business, as well as an increase in mortgage loan origination volumes. Other operating income increased $1.0 million, primarily due to an increase in gains on the sale of leased equipment.

Current wording

Our adjusted operating noninterest income (+), which excludes the pre-tax loss on CRE loan sale ($4.8 million in the third quarter 2025) and pre-tax gains on sale of securities ($4,000 in both the third quarter 2025 and 2024), increased $22.3 million or 65.0% to $56.6 million for the quarter ended September 30, 2025, compared to $34.3 million for the quarter ended September 30, 2024. The increase in adjusted operating noninterest income(+) was primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the $11.7 million increase in fiduciary and asset management fees, due to assets under management increasing approximately 117%, the $3.0 million increase in service charges on deposit accounts, and the $1.6 million increase in mortgage banking income. In addition to the acquisition impact, loan-related interest rate swap fees increased $4.4 million due to higher transaction volumes.

Previous wording

Our noninterest income increased $57.7 million or 242.4% to $81.5 million for the quarter ended June 30, 2025, compared to $23.8 million for the quarter ended June 30, 2024, primarily driven by the $15.7 million pre-tax gain on the CRE loan sale, a $14.3 million pre-tax gain on the sale of our equity interest in CSP, a $6.5 million pre-tax loss on the sale of securities in the second quarter of 2024 as part of our restructuring of the American National securities portfolio, and the full quarter impact of the Sandy Spring acquisition that closed on April 1, 2025.

Current wording

Our noninterest income increased $78.8 million or 94.2% to $162.4 million for the nine months ended September 30, 2025, compared to $83.7 million for the nine months ended September 30, 2024, primarily due to the impact of the Sandy Spring acquisition, and a $25.1 million increase in other operating income, primarily driven by a $14.3 million pre-tax gain on the sale of our equity interest in CSP and a $10.9 million pre-tax gain on the CRE loan sale. In addition, pre-tax losses incurred on the sale of AFS securities decreased by $6.4 million from the prior year due to our restructuring of the American National securities portfolio in 2024.

Previous wording

Our adjusted operating noninterest income,(+) which excludes the pre-tax gain on CRE loan sale ($15.7 million in 2025), pre-tax gain on sale of our equity interest in CSP ($14.3 million in 2025), and pre-tax losses on sale of securities ($87,000 in 2025 and $6.5 million in 2024), increased $24.9 million or 44.5% to $80.8 million for the six months ended June 30, 2025, compared to $55.9 million for the six months ended June 30, 2024. The increase in adjusted operating noninterest income(+) was primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the $12.7 million increase in fiduciary and asset management fees, due to assets under management increasing approximately 120%, the $4.3 million increase in service charges on deposit accounts, and the $1.3 million increase in interchange fees. In addition to the acquisition impacts, the BOLI income increase of $3.8 million includes death benefits of $2.4 million received in the second quarter of 2025, the mortgage banking income increase of $1.7 million includes the impact of Sandy Spring’s mortgage business, as well as an increase in mortgage loan origination volumes, and loan-related interest rate swap fees increased $1.3 million due to higher transaction volumes.

Current wording

Our adjusted operating noninterest income (+), which excludes the pre-tax gain on CRE loan sale ($10.9 million in 2025), pre-tax gain on sale of our equity interest in CSP ($14.3 million in 2025), and pre-tax losses on sale of securities ($83,000 in 2025 and $6.5 million in 2024), increased $47.1 million or 52.2% to $137.3 million for the nine months ended September 30, 2025, compared to $90.2 million for the nine months ended September 30, 2024. The increase in adjusted operating noninterest income(+) was primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the $24.4 million increase in fiduciary and asset management fees, due to assets under management increasing approximately 117%, the $7.3 million increase in service charges on deposit accounts, the $3.3 million increase in mortgage banking income, and the $2.0 million increase in interchange fees. In addition to the acquisition impacts, loan-related interest rate swap fees increased $5.7 million due to higher transaction volumes and BOLI income increased $3.9 million, primarily due to death benefits of $2.4 million received in the second quarter of 2025.

Previous wording

Our noninterest expense increased $129.7 million or 86.5% to $279.7 million for the quarter ended June 30, 2025, compared to $150.0 million for the quarter ended June 30, 2024, primarily driven by a $49.1 million increase in merger-related costs, a $41.4 million increase in salaries and benefits, and other increases in noninterest expense, primarily due to the full quarter impact of the Sandy Spring acquisition that closed on April 1, 2025.

Current wording

Our noninterest expense increased $115.9 million or 94.5% to $238.4 million for the quarter ended September 30, 2025, compared to $122.6 million for the quarter ended September 30, 2024, primarily driven by a $38.9 million increase in salaries and benefits expense, a $33.5 million increase in merger-related costs, and other increases in noninterest expense, primarily due to the impact of the Sandy Spring acquisition.

Previous wording

Our adjusted operating noninterest expense(+), which excludes merger-related costs ($78.9 million in the second quarter 2025 and $29.8 million in the second quarter 2024) and amortization of intangible assets ($18.4 million in the second quarter 2025 and $6.0 million in the second quarter 2024) increased $68.2 million or 59.6% to $182.4 million for the quarter ended June 30, 2025, compared to $114.2 million for the quarter ended June 30, 2024. The increase in adjusted operating noninterest expense(+) was primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the $41.4 million increase in salaries and benefits, the $7.0 million increase in technology and data processing, the $4.9 million increase in occupancy expenses, the $4.4 million in other expenses, the $4.0 million increase in FDIC assessment premiums and other insurance, the $3.4 million increase in professional services and the $2.5 million increase in furniture and equipment expenses.

Current wording

Our adjusted operating noninterest expense(+), which excludes merger-related costs ($34.8 million in the third quarter 2025 and $1.4 million in the third quarter 2024) and amortization of intangible assets ($18.1 million in the third quarter 2025 and $5.8 million in the third quarter 2024) increased $70.1 million or 60.7% to $185.5 million for the quarter ended September 30, 2025, compared to $115.4 million for the quarter ended September 30, 2024. The increase in adjusted operating noninterest expense(+) was primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the $38.9 million increase in salaries and benefits expense, the $7.3 million increase in technology and data processing, the $5.8 million increase in occupancy expenses, the $5.3 million in other expenses, the $4.8 million increase in professional services, the $3.5 million increase in FDIC assessment premiums and other insurance, the $2.9 million increase in furniture and equipment expenses, and the $1.8 million increase in marketing and advertising expense.

Previous wording

Our noninterest expense increased $158.6 million or 62.1% to $413.9 million for the six months ended June 30, 2025, compared to $255.3 million for the six months ended June 30, 2024, primarily driven by a $54.9 million increase in salaries and benefits, a $52.2 million increase in merger-related costs, and other increases in noninterest expense, primarily due to the impact of the Sandy Spring acquisition that closed on April 1, 2025.

Current wording

Our noninterest expense increased $274.5 million or 72.6% to $652.3 million for the nine months ended September 30, 2025, compared to $377.9 million for the nine months ended September 30, 2024, primarily driven by a $93.8 million increase in salaries and benefits expense, a $85.6 million increase in merger-related costs, and other increases in noninterest expense, primarily due to the impact of the Sandy Spring acquisition.

Previous wording

Our adjusted operating noninterest expense(+), which excludes merger-related costs ($83.8 million in 2025 and $31.7 million in 2024), amortization of intangible assets ($23.8 million in 2025 and $7.9 million in 2024), and a FDIC special assessment ($840,000 in 2024) increased $91.3 million or 42.5% to $306.2 million for the six months ended June 30, 2025, compared to $214.9 million for the six months ended June 30, 2024. The increase in adjusted operating noninterest expense(+) was primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the $54.9 million increase in salaries and benefits, the $9.0 million increase in technology and data processing, the $6.9 million increase in occupancy expenses, the $5.0 million increase in professional services, the $4.9 million increase in FDIC assessment premiums and other insurance, and the $3.1 million increase in furniture and equipment expenses. In addition to the acquisition impacts, other expenses increased $6.0 million, primarily due to an increase in non-credit related losses on customer transactions and marketing and advertising expense increased $1.6 million.

Current wording

Our adjusted operating noninterest expense(+), which excludes merger-related costs ($118.7 million in 2025 and $33.0 million in 2024), amortization of intangible assets ($42.0 million in 2025 and $13.7 million in 2024), and a FDIC special assessment ($840,000 in 2024) increased $161.4 million or 48.9% to $491.7 million for the nine months ended September 30, 2025, compared to $330.3 million for the nine months ended September 30, 2024. The increase in adjusted operating noninterest expense(+) was primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the $93.8 million increase in salaries and benefits expense, the $16.3 million increase in technology and data processing, the $12.7 million increase in occupancy expenses, the $11.3 million increase in other expenses, the $9.8 million increase in professional services, the $7.6 million increase in FDIC assessment premiums and other insurance, the $6.0 million increase in furniture and equipment expenses, and the $3.4 million increase in marketing and advertising expense.

Previous wording

Our Wholesale Banking segment provides loan, leasing, and deposit services, as well as treasury management and capital market services to wholesale customers primarily throughout Virginia, Maryland, North Carolina, and South Carolina. These customers include CRE and commercial and industrial customers. This segment also includes our equipment finance subsidiary, which has nationwide exposure. The wealth management business also resides in the Wholesale Banking segment.

Current wording

Our Wholesale Banking segment provides loan, leasing, and deposit services, as well as treasury management and capital market services to wholesale customers primarily throughout Virginia, Maryland, North Carolina, South Carolina, and Washington D.C. These customers include CRE and commercial and industrial customers. This segment also includes our equipment finance subsidiary, which has nationwide exposure. The wealth management business also resides in the Wholesale Banking segment.

Previous wording

The following table presents operating results for the three and six months ended June 30, for the Wholesale Banking segment (dollars in thousands):

Current wording

The following table presents operating results for the three and nine months ended September 30, for the Wholesale Banking segment (dollars in thousands):

Previous wording

Wholesale Banking income before income taxes decreased by $19.6 million and $18.7 million, respectively, for the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024. The decreases were primarily due to increases in the provision for credit losses primarily driven by the Day 1 initial provision expense on non-PCD loans and unfunded commitments acquired from Sandy Spring. In addition, Wholesale Banking noninterest expense increased for the three and six months ended June 30, 2025 compared to the same periods in 2024, primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the increases in salaries and benefits. The decreases in income before income taxes were partially offset by increases in net interest income, driven by the impact of the Sandy Spring acquisition. Wholesale Banking noninterest income also increased for the three and six months ended June 30, 2025 compared to the same periods in 2024, primarily due to the impact of Sandy Spring acquisition, which drove the majority of the increases in fiduciary and asset management fees.

Current wording

Wholesale Banking income before income taxes increased by $21.4 million and $2.7 million, respectively, for the three and nine months ended September 30, 2025, compared to the three and nine months ended September 30, 2024. The increases were primarily due to increases in net interest income, primarily driven by the impact of the Sandy Spring acquisition. In addition, Wholesale Banking noninterest income increased for the three and nine months ended September 30, 2025, compared to the same periods in 2024, primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the increases in fiduciary and asset management fees and service charges on deposit accounts.

Previous wording

LHFI for the Wholesale Banking segment increased $7.4 billion to $22.9 billion at June 30, 2025, compared to December 31, 2024, primarily driven by the Sandy Spring acquisition, as well as organic loan growth.

Current wording

LHFI for the Wholesale Banking segment increased $7.3 billion to $22.9 billion at September 30, 2025, compared to December 31, 2024, primarily driven by the Sandy Spring acquisition, as well as organic loan growth.

Previous wording

Wholesale Banking deposits increased $4.5 billion to $11.7 billion at June 30, 2025, compared to December 31, 2024, primarily due to increases in interest-bearing customer deposits and demand deposits, primarily driven by the Sandy Spring acquisition.

Current wording

Wholesale Banking deposits increased $4.4 billion to $11.5 billion at September 30, 2025, compared to December 31, 2024, primarily due to increases in interest-bearing customer deposits and demand deposits, primarily driven by the Sandy Spring acquisition.

Previous wording

Our Consumer Banking segment provides loan and deposit services to consumers and small businesses throughout Virginia, Maryland, and North Carolina. Consumer Banking also includes the home loan division and investment management and advisory services businesses.

Current wording

Our Consumer Banking segment provides loan and deposit services to consumers and small businesses throughout Virginia, Maryland, North Carolina, and Washington D.C. Consumer Banking also includes the home loan division and investment management and advisory services businesses.

Previous wording

The following table presents operating results for the three and six months ended June 30, for the Consumer Banking segment (dollars in thousands):

Current wording

The following table presents operating results for the three and nine months ended September 30, for the Consumer Banking segment (dollars in thousands):

Previous wording

Consumer Banking income before income taxes decreased by $16.3 million and $19.2 million, respectively, for the three and six months ended June 30, 2025, compared to the three and six months ended June 30, 2024. The decreases were primarily due to increases in noninterest expense, primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the increases in salaries and benefits. In addition, the Consumer Banking provision for credit losses increased for the three and six months ended June 30, 2025 compared to the same periods in 2024, primarily driven by the Day 1 initial provision expense on non-PCD loans and unfunded commitments acquired from Sandy Spring. The decreases in income before income taxes were partially offset by increases in net interest income driven by the impact of the Sandy Spring acquisition. Consumer Banking noninterest income also increased for the three and six months ended June 30, 2025, compared to the same periods in 2024, primarily due to the impact of Sandy Spring acquisition, which drove the majority of the increases in service charges on deposit accounts and interchange fees. In addition to the acquisition impact, the increases in noninterest income were driven by increases in mortgage banking income, which includes the impact of Sandy Spring’s mortgage business, as well as increases in mortgage loan origination volumes.

Current wording

Consumer Banking income before income taxes decreased by $3.8 million and $22.9 million, respectively, for the three and nine months ended September 30, 2025, compared to the three and nine months ended September 30, 2024. The decreases were primarily due to increases in noninterest expense, primarily due to the impact of the Sandy Spring acquisition. In addition, the Consumer Banking provision for credit losses increased for the nine months ended September 30, 2025, compared to the same period in 2024, primarily driven by the CECL Day 1 initial provision expense on non-PCD loans and unfunded commitments acquired from Sandy Spring.

Previous wording

Consumer Banking deposits increased $6.0 billion to $17.9 billion at June 30, 2025, compared to December 31, 2024, primarily due to increases across all deposit categories, primarily driven by the Sandy Spring acquisition.

Current wording

Consumer Banking deposits increased $6.1 billion to $18.0 billion at September 30, 2025, compared to December 31, 2024, primarily due to increases across all deposit categories, primarily driven by the Sandy Spring acquisition.

Previous wording

Our effective tax rate for the three months ended June 30, 2025 and 2024 was (13.2%) and 31.2%, respectively, and the effective tax rate for the six months ended June 30, 2025 and 2024 was 11.9% and 22.3%, respectively. The decreases in the effective tax rate for both the three and six months ended June 30, 2025 reflects the impact of a $8.0 million income tax benefit recorded this quarter related to re-evaluating our state deferred tax asset, as a result of the Sandy Spring acquisition, as well as the impact of the $4.8 million valuation allowance established during the second quarter of 2024.

Current wording

Our effective tax rate for the three months ended September 30, 2025 and 2024 was 20.8% and 17.0%, respectively, and the effective tax rate for the nine months ended September 30, 2025 and 2024 was 17.2% and 19.7%, respectively. The increase in the effective tax rate for the three months ended September 30, 2025 is primarily due to the Sandy Spring acquisition, which resulted in additional state income tax expense, as well as an overall increase in the proportion of tax-exempt to pre-tax income. The decrease in the effective tax rate for the nine months ended September 30, 2025 primarily reflects the impact of the Sandy Spring acquisition, which resulted in a $8.0 million income tax benefit in the second quarter of 2025 related to re-evaluating our state net deferred tax assets as a result of the Sandy Spring acquisition, as well as the impact of the $4.8 million valuation allowance established during the second quarter of 2024.

Previous wording

As of each reporting date, we consider existing evidence, both positive and negative, that could impact our view regarding our future realization of deferred tax assets. Our valuation allowance was $11.1 million and $4.4 million as of June 30, 2025 and December 31, 2024, respectively. The increase in the valuation allowance was due to the Sandy Spring acquisition and Sandy Spring’s historical valuation allowance relating to net operating losses in certain state filing jurisdictions. The prior year valuation allowance balance primarily includes the initial recording of the deferred tax asset valuation.

Current wording

As of each reporting date, we consider existing evidence, both positive and negative, that could impact our view regarding our future realization of deferred tax assets. Our valuation allowance was $11.9 million and $4.4 million as of September 30, 2025 and December 31, 2024, respectively. The increase in the valuation allowance was due to the Sandy Spring acquisition and its historical valuation allowance related to net operating losses in certain state filing jurisdictions.

Previous wording

LHFI were $27.3 billion at June 30, 2025, an increase of $8.9 billion or 96.7% (annualized) from December 31, 2024, primarily due to the Sandy Spring acquisition, as well as organic loan growth. At June 30, 2025, quarterly average LHFI increased $8.9 billion or 49.2% from the same period in the prior year. Refer to "Loan Portfolio" within this Item 2 and Note 4 "Loans and Allowance for Loan and Lease Losses" in Part I, Item 1 of this Quarterly Report for additional information on our loan activity.

Current wording

LHFI were $27.4 billion at September 30, 2025, an increase of $8.9 billion from December 31, 2024, primarily due to the Sandy Spring acquisition, as well as organic loan growth. At September 30, 2025, quarterly average LHFI increased $9.1 billion or 49.5% from the same period in the prior year. Refer to "Loan Portfolio" within this Item 2 and Note 4 "Loans and Allowance for Loan and Lease Losses" in Part I, Item 1 of this Quarterly Report for additional information on our loan activity.

Previous wording

At June 30, 2025, we had total investments of $4.8 billion, an increase of $1.4 billion or 86.0% (annualized) from December 31, 2024. The increase in total investments was primarily due to the Sandy Spring acquisition. AFS securities totaled $3.8 billion at June 30, 2025, compared to $2.4 billion at December 31, 2024. As part of the Sandy Spring acquisition, we restructured $485.2 million of securities acquired from Sandy Spring and reinvested the proceeds into higher yielding securities. At June 30, 2025, total net unrealized losses on the AFS securities portfolio were $372.8 million, compared to $402.6 million at December 31, 2024. HTM securities totaled $827.1 million at June 30, 2025, compared to $803.9 million at December 31, 2024, with net unrealized losses of $49.2 million at June 30, 2025, compared to $44.5 million at December 31, 2024.

Current wording

At September 30, 2025, we had total investments of $5.3 billion, an increase of $2.0 billion from December 31, 2024. The increase in total investments was primarily due to the Sandy Spring acquisition, as well as purchases of AFS agency mortgage-backed securities and HTM municipal bonds using a portion of the proceeds from the CRE loan sale that occurred in the second quarter of 2025. AFS securities totaled $4.3 billion at September 30, 2025, compared to $2.4 billion at December 31, 2024. At September 30, 2025, total net unrealized losses on the AFS securities portfolio were $327.6 million, compared to $402.6 million at December 31, 2024. HTM securities totaled $883.8 million at September 30, 2025, compared to $803.9 million at December 31, 2024, with net unrealized losses of $35.7 million at September 30, 2025, compared to $44.5 million at December 31, 2024.

Previous wording

At June 30, 2025, we had total liabilities of $32.5 billion, an increase of $11.0 billion or approximately 103.6% (annualized) from December 31, 2024, which was primarily driven by the growth in total deposits, primarily due to the Sandy Spring acquisition.

Current wording

At September 30, 2025, we had total liabilities of $32.2 billion, an increase of $10.7 billion from December 31, 2024, which was primarily driven by the growth in deposits, primarily due to the Sandy Spring acquisition.

Previous wording

Total deposits at June 30, 2025 were $31.0 billion, an increase of $10.6 billion or approximately 104.5% (annualized) from December 31, 2024. At June 30, 2025, quarterly average deposits increased $11.2 billion or 56.0% from the same period in the prior year. Total deposits increased from December 31, 2024 primarily due to increases in interest-bearing customer deposits and demand deposits, primarily related to the Sandy Spring acquisition. Refer to “Deposits” within this Item 2 for additional information on this topic.

Current wording

Total deposits at September 30, 2025 were $30.7 billion, an increase of $10.3 billion from December 31, 2024. At September 30, 2025, quarterly average deposits increased $10.9 billion or 53.8% from the same period in the prior year. The increases were primarily due to increases in interest-bearing customer deposits and demand deposits, primarily related to the addition of the Sandy Spring acquired deposits. Refer to “Deposits” within this Item 2 for additional information on this topic.

Previous wording

Total borrowings at June 30, 2025 were $892.8 million, an increase of $358.2 million or 135.1% (annualized) from December 31, 2024, primarily due to the long-term subordinated debt of $358.0 million assumed in connection with the Sandy Spring acquisition. Refer to Note 7 “Borrowings” in Part I, Item 1 of this Quarterly Report for additional information on our borrowing activity.

Current wording

Total borrowings at September 30, 2025 were $860.3 million, an increase of $325.7 million from December 31, 2024, primarily due to the long-term subordinated debt of $358.0 million assumed in connection with the Sandy Spring acquisition. Refer to Note 7 “Borrowings” in Part I, Item 1 of this Quarterly Report for additional information on our borrowing activity.