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 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 strategic expansion into North Carolina; 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

Please also refer to such other factors as discussed throughout Part I, Item 1A. “Risk Factors” and Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the 2024 Form 10-K and related disclosures in other filings, which have been filed with the SEC and are available on the SEC’s website at www.sec.gov. All risk factors and uncertainties described herein and therein should be considered in evaluating forward-looking statements, and all of the forward-looking statements made in this Quarterly Report are expressly qualified by the cautionary statements contained or referred to herein and therein. The actual results or developments anticipated may not be realized or, even if substantially realized, they may not have the expected consequences to or effects on the Company or our businesses or operations. Readers are cautioned not to rely too heavily on the forward-looking statements contained in this Quarterly Report. Forward-looking statements speak only as of the date they are made. We do not intend or assume any obligation to update, revise or clarify any forward-looking statements that may be made from time to time by or on behalf of the Company, whether as a result of new information, future events or otherwise, except as required by law.

Current wording

More information on factors that could affect our forward-looking statements is discussed throughout Part I, Item 1A. “Risk Factors” and Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the 2025 Form 10-K and related disclosures in other filings, which have been filed with the SEC and are available on the SEC’s website at www.sec.gov. All risk factors and uncertainties described herein and therein should be considered in evaluating forward-looking statements, and all of the forward-looking statements made in this Quarterly Report are expressly qualified by the cautionary statements contained or referred to herein and therein. The actual results or developments anticipated may not be realized or, even if substantially realized, they may not have the expected consequences to or effects on the Company or our businesses or operations. Readers are cautioned not to rely too heavily on the forward-looking statements contained in this Quarterly Report. Forward-looking statements speak only as of the date they are made. We do not intend or assume any obligation to update, revise or clarify any forward-looking statements that may be made from time to time by or on behalf of the Company, whether as a result of new information, future events or otherwise, except as required by law.

Previous wording

Certain accounting policies inherently have a greater reliance on the use of estimates, assumptions and judgments and, as such, have a greater possibility of producing results that could be materially different than originally reported. We have identified the allowance for loan and lease losses, fair value measurements, and acquisition accounting as accounting policies that require the most difficult, subjective, or complex judgments and, as such, could be most subject to revision as new or additional information becomes available or circumstances change. Therefore, we evaluate these accounting policies and related critical accounting estimates on an ongoing basis and update them as needed. Management has discussed these accounting policies and the critical accounting estimates summarized below with the Audit Committee of the Board of Directors.

Current wording

Certain accounting policies inherently have a greater reliance on the use of estimates, assumptions and judgments and, as such, have a greater possibility of producing results that could be materially different than originally reported. We have identified the allowance for loan and lease losses, fair value measurements, valuation of deferred tax assets, and valuation of acquired assets and liabilities as accounting policies that require the most difficult, subjective or complex judgments and, as such, could be most subject to revision as new or additional information becomes available or circumstances change. Therefore, we evaluate these accounting policies and related critical accounting estimates on an ongoing basis and update them as needed. Management has discussed these accounting policies and the critical accounting estimates summarized below with the Audit Committee of the Board of Directors.

Previous wording

We provide additional information about our critical accounting estimates in “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates” in our 2024 Form 10-K. There have been no material changes to our critical accounting policies or the estimates made pursuant to those policies during the most recent quarter from those disclosed in our 2024 Form 10-K.

Current wording

We provide additional information about our critical accounting estimates in “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates” in our 2025 Form 10-K.

Previous wording

In September 2025, the FASB issued ASU No. 2025-06*Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software,*which outlined targeted improvements to Subtopic 350-40 to increase the operability of the recognition guidance considering different methods of software development. The amendments are effective for fiscal years beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. We are evaluating the impact of ASU No. 2025-06 on our consolidated financial statements.

Current wording

In September 2025, the FASB issued ASU No. 2025-06Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which outlined targeted improvements to Subtopic 350-40 to increase the operability of the recognition guidance considering different methods of software development. The amendments are effective for fiscal years beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. We are evaluating the impact of ASU No. 2025-06 on our consolidated financial statements.

Previous wording

In September 2025, the FASB issued ASU No. 2025-07Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract. The update to Topic 815 outlined the addition of derivative scope exceptions with underlyings that are based on the operations or activities of one of the parties to the contract. The update to Topic 606 clarified the applicability of Topic 606 and its interaction with other Topics. The amendments are effective for fiscal years beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. ASU No. 2025-07 is not expected to have an impact on our financial condition or results of operations.

Current wording

In September 2025, the FASB issued ASU No. 2025-07Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract. The update to Topic 815 outlined the addition of derivative scope exceptions with underlyings that are based on the operations or activities of one of the parties to the contract. The update to Topic 606 clarified the applicability of Topic 606 and its interaction with other Topics. The amendments are effective for fiscal years beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. ASU No. 2025-07 is not expected to have an impact on our consolidated financial statements.

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, 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.

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; AUB Investments, Inc., which provides investment services; and Atlantic Union Capital Markets, Inc., which provides capital market services.

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 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.

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, 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.

Previous 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.

Current wording

During the first quarter of 2026, financial markets experienced increased and prolonged economic uncertainty arising from international conflicts, including those in the Middle East, and changes in the unemployment rate. These factors 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

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.

Current wording

In March 2026, the FOMC maintained the target range for the Federal Funds rate at 3.50% to 3.75%. The FOMC noted that uncertainty about the economic outlook remains elevated, and the implications of developments in the Middle East for the U.S. economy are uncertain. In light of this continued uncertainty, 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.

Previous wording

Third Quarter Net Income & Performance Metrics

Current wording

First Quarter Net Income & Performance Metrics

Previous wording

Net interest income, which represents our principal source of revenue, is the amount by which interest income exceeds interest expense. Our interest margin represents net interest income expressed as a percentage of average earning assets. Changes in the volume and mix of interest-earning assets and interest-bearing liabilities, as well as their respective yields and rates, have a significant impact on our net interest income, net interest margin, and net income. In addition, our interest income includes the accretion of discounts on our acquired loans, which will also affect our net interest income and net interest margin.

Current wording

Net interest income, which represents our principal source of revenue, is the amount by which interest income exceeds interest expense. Our net interest margin represents net interest income expressed as a percentage of average earning assets. Changes in the volume and mix of interest-earning assets and interest-bearing liabilities, as well as their respective yields and rates, have a significant impact on our net interest income, net interest margin, and net income. In addition, our net interest income includes the accretion of discounts on our acquired loans, as well as amortization of deposits and borrowings, which will also affect our net interest income and net interest margin.

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 nine months ended September 30, (dollars in thousands):

Current wording

The following tables show interest and dividend 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 months ended March 31, (dollars in thousands):

Previous 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.

Current wording

For the first quarter of 2026, our net interest income was $312.4 million, an increase of $128.2 million from the first quarter of 2025, and our net interest income (FTE)(+) was $316.9 million, an increase of $129.0 million from the first quarter of 2025. The increases were primarily the result of a $11.3 billion increase in average interest earning assets and higher net accretion income, partially offset by a $8.2 billion increase in average interest-bearing liabilities, primarily related to the acquisition of Sandy Spring, as well as organic loan growth and lower cost of funds. The decline in cost of funds was driven by lower deposit costs, reflecting the impact of the Federal Reserve lowering the Federal Funds rates 75 bps between September and December 2025.

Previous 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.

Current wording

In the first quarter of 2026, our net interest margin increased 42 bps to 3.80% from 3.38% in the first quarter of 2025, and our net interest margin (FTE)(+) increased 40 bps to 3.85% in the first quarter of 2026 from 3.45% for the same period of 2025. The increases in net interest margin and net interest margin (FTE)(+) were primarily driven by lower cost of funds and higher earning asset yields. Our cost of funds decreased 29 bps to 1.94% from 2.23% in the first quarter of 2025, due to lower cost of deposits, primarily due to the Federal Funds rate cuts discussed above, as well as reduced brokered deposits. The lower cost of funds was 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 related to the Sandy Spring acquisition. Our earning asset yield increased 12 bps to 5.73% for the first quarter of 2026 from 5.61% in the first quarter of 2025, due to increases in loan balances and accretion income, primarily driven by the Sandy Spring acquisition.

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 $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):

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 $32.9 million for the first quarter of 2026, an increase of $20.3 million compared to the first quarter of 2025, 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

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):

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 months ended March 31, (dollars in thousands):

Previous wording

(5)Interest expense on time deposits includes accretion (amortization) of the fair market value related to acquisitions, as disclosed above.

Current wording

(5)Interest expense on time deposits includes accretion (amortization) of the fair market value adjustments related to acquisitions, as disclosed above.

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 nine months ended September 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 months ended March 31, (dollars in thousands):

Previous 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.

Current wording

Our noninterest income increased $25.6 million or 87.9% to $54.8 million for the quarter ended March 31, 2026, compared to the quarter ended March 31, 2025, primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the $13.5 million increase in fiduciary and asset management fees, due to assets under management increasing 125%, the $2.4 million increase in service charges on deposit accounts, the $1.7 million increase in BOLI income, and the $1.1 million increase in mortgage banking income. In addition to the acquisition impact, other operating income increased $4.9 million, primarily due to an increase in equity method investment income, and loan-related interest rate swap fees increased $1.6 million due to higher transaction volumes.

Previous 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.

Current wording

Our adjusted operating noninterest expense(+), which excludes amortization of intangible assets ($15.4 million in the first quarter 2026 and $5.4 million in the first quarter 2025) and merger-related costs ($9.0 million in the first quarter 2026 and $4.9 million in the first quarter 2025) increased $61.5 million or 49.7% to $185.3 million for the quarter ended March 31, 2026, compared to $123.8 million for the quarter ended March 31, 2025. The increase in adjusted operating noninterest expense(+) was primarily due to the impact of the Sandy Spring acquisition, which drove the majority of the $38.0 million increase in salaries and benefits expense, the $5.4 million increase in technology and data processing, the $4.6 million increase in occupancy expenses, the $4.1 million increase in marketing and advertising expense, the $3.3 million increase in other expenses, the $1.6 million increase in FDIC assessment premiums and other insurance, the $1.6 million increase in furniture and equipment expenses, and the $1.6 million increase in loan-related expenses. In addition to the acquisition impacts, professional services increased $1.1 million related to strategic projects that occurred during the first quarter of 2026.

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, 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.

Current wording

Our Wholesale Banking segment provides loan, leasing, deposit, treasury management, and capital market services to wholesale customers primarily throughout Virginia, Maryland, Washington, D.C., 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 which provides a wide variety of financial planning, wealth management and trust services to individuals and corporations.

Previous wording

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

Current wording

The following table presents operating results for the three months ended March 31, for the Wholesale Banking segment (dollars in thousands):

Previous 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.

Current wording

Wholesale Banking income before income taxes increased by $54.9 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. The increase was primarily due to increases in net interest income and noninterest income, in each case primarily driven by the impact of the Sandy Spring acquisition. In addition, the Wholesale Banking provision for credit losses decreased as compared to the same period in the prior year, primarily due to higher uncertainty in the economic outlook in the prior year, as well as specific reserves recorded in the prior year on two impaired commercial and industrial loans.

Previous 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.

Current wording

At March 31, 2026, Wholesale Banking deposits increased $538.9 million to $11.9 billion, compared to December 31, 2025, primarily due to an increase in interest-bearing customer deposits.

Previous 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.

Current wording

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

Previous wording

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

Current wording

The following table presents operating results for the three months ended March 31, for the Consumer Banking segment (dollars in thousands):

Previous wording

Our provision for income taxes is based on our results of operations, adjusted for the effect of certain tax-exempt income and non-deductible expenses. In addition, we report certain items of income and expense in different periods for financial reporting and tax return purposes. We recognize the tax effects of these temporary differences in the deferred income tax provision or benefit. Deferred tax assets or liabilities are computed based on the difference between the financial statements and income tax bases of assets and liabilities using the applicable enacted marginal tax rate.

Current wording

Our provision for income taxes is based on our results of operations, adjusted for the effect of certain tax-exempt income and non-deductible expenses. In addition, we report certain items of income and expense in different periods for financial reporting and tax return purposes. We recognize the tax effects of these temporary differences in the deferred income tax provision or benefit. Deferred tax assets or liabilities are computed based on the difference between the financial statements and income tax bases of assets and liabilities using the applicable enacted marginal tax rate. Asof each reporting date, we consider existing evidence, both positive and negative, that could impact our view regarding our future realization of deferred tax assets.

Previous 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.

Current wording

Our effective tax rate for the three months ended March 31, 2026 and March 31, 2025 was 21.0% and 19.0%, respectively. The increase in the effective tax rate for the three months ended March 31, 2026 is primarily due to the Sandy Spring acquisition, which resulted in additional state income tax expense due to an expanded tax footprint and an overall increase in the proportion of taxable income to tax-exempt income.

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 $11.9 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.

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. This assessment was consistent with our conclusions in the prior period.

Previous 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.

Current wording

LHFI totaled $27.9 billion at March 31, 2026, an increase of $150.3 million or 2.2% (annualized) from December 31, 2025, primarily due to an increase in the commercial and industrial portfolio. At March 31, 2026, quarterly average LHFI increased $9.4 billion or 51.0% from the same period in the prior year, primarily due to the addition of the Sandy Spring acquired loans. 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 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.

Current wording

Total securities at March 31, 2026 were $5.1 billion, a decrease of $209.5 million or 16.1% (annualized) from December 31, 2025. The decrease in total securities was primarily due to principal repayments and maturities of AFS securities. AFS securities totaled $4.0 billion at March 31, 2026, compared to $4.2 billion at December 31, 2025. At March 31, 2026, total net unrealized losses on the AFS securities portfolio were $322.1 million, compared to $295.7 million at December 31, 2025. HTM securities totaled $870.3 million at March 31, 2026, compared to $884.2 million at December 31, 2025, with net unrealized losses of $35.5 million at March 31, 2026, compared to $27.4 million at December 31, 2025.

Previous 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.

Current wording

Total deposits at March 31, 2026 were $30.4 billion, a decrease of $80.4 million or 1.1% (annualized) from December 31, 2025, and was primarily due to a decline in brokered deposits, partially offset by an increase in interest-bearing customer deposits. Quarterly average deposits at March 31, 2026 increased $9.7 billion or 47.6% from the same period in the prior year, primarily due 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 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.

Current wording

Total borrowings at March 31, 2026 were $1.3 billion, a decrease of $192.7 million or 52.2% (annualized) from December 31, 2025, primarily due to the higher short-term borrowings in the prior quarter that were repaid in the current quarter using funds from customer deposits, Refer to Note 7 “Borrowings” in Part I, Item 1 of this Quarterly Report for additional information on our borrowing activity.

Previous wording

At September 30, 2025, our stockholders’ equity was $4.9 billion, an increase of $1.8 billion from December 31, 2024, primarily driven by the issuance of common stock in connection with the Sandy Spring acquisition. In addition, on April 1, 2025, we physically settled in full the Forward Sale Agreements and received net proceeds, before expenses, of approximately $385.0 million. Our consolidated regulatory capital ratios continue to exceed the minimum capital requirements and are considered “well-capitalized” for regulatory purposes. Refer to “Capital Resources” within this Item 2, as well as Note 10 "Stockholders’ Equity" in Part I, Item 1 of this Quarterly Report for additional information on our capital resources and the Forward Sale Agreements.

Current wording

At March 31, 2026, our stockholders’ equity was $5.1 billion, an increase of $45.9 million from December 31, 2025. Our consolidated regulatory capital ratios continue to exceed the minimum capital requirements and are considered “well-capitalized” for regulatory purposes. Refer to “Capital Resources” within this Item 2, as well as Note 10 "Stockholders’ Equity" in Part I, Item 1 of this Quarterly Report for additional information on our capital resources and the Forward Sale Agreements.

Previous wording

During the third quarter of 2025, we declared and paid a quarterly dividend on our outstanding shares of Series A Preferred Stock of $171.88 per share (equivalent to $0.43 per outstanding depositary share), consistent with the fourth quarter of 2024 and the third quarter of 2024. During the third quarter of 2025, we also declared and paid cash dividends of $0.34 per common share, consistent with the fourth quarter of 2024 and an increase of $0.02 per share or 6.3% from the third quarter of 2024.

Current wording

During the first quarter of 2026, we declared and paid a quarterly dividend on our outstanding shares of Series A Preferred Stock of $171.88 per share (equivalent to $0.43 per outstanding depositary share), consistent with the fourth quarter of 2025 and the first quarter of 2025. During the first quarter of 2026, we also declared and paid cash dividends of $0.37 per common share, consistent with the fourth quarter of 2025 and an increase of $0.03 per share or 8.8% from the first quarter of 2025.

Previous wording

At September 30, 2025, we had total investments of $5.3 billion or 14.3% of total assets as compared to $3.3 billion or 13.6% of total assets at December 31,2024. This increase was primarily due to the Sandy Spring acquisition and 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. We seek to diversify our investment portfolio to minimize risk, and we focus on purchasing MBS for cash flow and reinvestment opportunities and securities issued by states and political subdivisions due to the tax benefits and the higher tax-equivalent yield offered from these securities. The majority of our MBS are agency-backed securities, which have a government guarantee. For information regarding the hedge transaction related to AFS securities, see Note 9 “Derivatives” in Part I, Item 1 of this Quarterly Report.

Current wording

At March 31, 2026, we had total securities of $5.1 billion or 13.6% of total assets, compared to $5.3 billion or 14.0% of total assets at December 31, 2025. This decrease was primarily due to principal repayments and maturities of AFS securities. We seek to diversify our investment portfolio to minimize risk, and we focus on purchasing MBS for cash flow and reinvestment opportunities and securities issued by states and political subdivisions due to the tax benefits and the higher tax-equivalent yield offered from these securities. The majority of our MBS are agency-backed securities, which have a government guarantee. For information regarding the hedge transaction related to AFS securities, see Note 9 “Derivatives” in Part I, Item 1 of this Quarterly Report.

Previous wording

As of September 30, 2025, we maintained a diversified municipal bond portfolio with approximately 64% of our holdings in general obligation issues and the remainder primarily backed by revenue bonds. Issuances within the State of Texas represented 19% of the total municipal portfolio; no other state had a concentration above 10%. Substantially all of our municipal holdings are considered investment grade. When purchasing municipal securities, we focus on strong underlying ratings for general obligation issuers or bonds backed by essential service revenues.

Current wording

As of March 31, 2026, we maintained a diversified municipal bond portfolio with approximately 64% of our holdings in general obligation issues and the remainder primarily backed by revenue bonds. Issuances within the State of Texas represented 20% of the total municipal portfolio; no other state had a concentration above 10%. Substantially all of our municipal holdings are considered investment grade. When purchasing municipal securities, we focus on strong underlying ratings for general obligation issuers or bonds backed by essential service revenues.

Previous wording

Liquidity represents an institution’s ability to meet present and future financial obligations through either the sale or maturity of existing assets or the acquisition of additional funds through liability management. Our largest source of liquidity on a consolidated basis is our customer deposit base generated by our wholesale and consumer businesses. These deposits provide relatively stable and low-cost funding. Total deposits at September 30, 2025 were $30.7 billion, an increase of $10.3 billion or approximately 50.3% from December 31, 2024. Total deposits increased from December 31, 2024 primarily due to an increase in interest-bearing customer deposits of $7.6 billion and demand deposits of $2.8 billion, partially offset by a decrease in brokered deposits. Refer to “Deposits” within this Item 2 for additional information on this topic.

Current wording

Liquidity represents an institution’s ability to meet present and future financial obligations through either the sale or maturity of existing assets or the acquisition of additional funds through liability management. Our largest source of liquidity on a consolidated basis is our customer deposit base generated by our wholesale and consumer businesses. These deposits provide relatively stable and low-cost funding. Total deposits at March 31, 2026 were $30.4 billion, a decrease of $80.4 million or 0.3% from December 31, 2025, primarily due to a decline in brokered deposits, partially offset by an increase in interest-bearing customer deposits. Refer to “Deposits” within this Item 2 for additional information on this topic.

Previous wording

We consider our liquid assets to include cash, interest-bearing deposits with banks, money market investments, federal funds sold, LHFS, and securities and loans maturing or re-pricing within one year. As of September 30, 2025, our liquid assets totaled $12.4 billion or 33.4% of total assets, and liquid earning assets totaled $12.0 billion or 36.3% of total earning assets. We also provide asset liquidity by managing loan and securities maturities and cash flows. As of September 30, 2025, loan payments of approximately $10.8 billion or 40.1% of total LHFI are expected within one year based on contractual terms, adjusted for expected prepayments, and approximately $723.8 million or 13.6% of total investments as of September 30, 2025 are scheduled to be paid down within one year based on contractual terms, adjusted for expected prepayments.

Current wording

We consider our liquid assets to include cash, interest-bearing deposits with banks, money market investments, federal funds sold, LHFS, and securities and loans maturing or re-pricing within one year. As of March 31, 2026, our liquid assets totaled $13.7 billion or 36.8% of total assets, and liquid earning assets totaled $13.3 billion or 39.8% of total earning assets. We also provide asset liquidity by managing loan and securities maturities and cash flows. As of March 31, 2026, loan payments of approximately $12.2 billion or 43.8% of total LHFI are expected within one year based on contractual terms, adjusted for expected prepayments, and approximately $703.3 million or 13.9% of total investments as of March 31, 2026 are scheduled to be paid down within one year based on contractual terms, adjusted for expected prepayments.