EAGLE BANCORP INC

Liquidity is a measure of the Company’s and Bank’s ability to meet loan demand and to satisfy depositor withdrawal requirements in an orderly manner. The Bank’s primary sources of liquidity consist of cash and cash balances due from correspondent banks, excess reserves at the Federal Reserve, loan repayments and other short-term investments, maturities and sales of investment securities, income from operations and new core deposits into the Bank. Approximately 53% of the Company's investment portfolio of debt securities is held as available-for-sale which allows flexibility to generate cash from sales as needed to meet ongoing cash needs. These securities can also be utilized as pledged assets that provide secondary liquidity through the form of additional available borrowings. These sources of liquidity are considered primary and are supplemented by the ability of the Company and Bank to borrow funds or issue brokered deposits, which are termed secondary sources of liquidity. Investment securities that are classified as held-to-maturity can also be used as collateral to pledge against additional borrowings.

The Company believes it maintains sufficient primary and secondary sources of liquidity to fund its operations. As of December 31, 2025, primary sources of liquidity were $1.7 billion, comprising interest-bearing deposits with other banks and other short-term investments and unencumbered AFS securities. Secondary sources of liquidity as of December 31, 2025 were $4.4 billion, which included the FHLB unused availability, other insured brokered deposit sweep programs, unpledged HTM securities, federal funds lines, and the FRB Discount Window. As of December 31, 2025, under the Company's liquidity formula, it had $6.1 billion of primary and secondary liquidity sources. Management believes the amount is adequate to meet current and projected funding needs.

The table below summarizes the Company's primary and secondary sources of liquidity available.

(1)Consists of cash and due from banks, interest-bearing deposits with banks, and other short-term investments.

(2)Secondary sources of liquidity in use was $592.1 million as of December 31, 2025 and $1.6 billion as of December 31, 2024.

(3)The available liquidity from the unsecured brokered deposits represents unsecured funds under one-way CDARS, ICS, and other brokered deposits that would require paying prevailing market rates and would be dependent on the availability of funds in those networks.

Additionally, the Bank can purchase up to $145.0 million in federal funds on an unsecured basis from its correspondents, against which there were no amounts outstanding as of December 31, 2025 and can borrow

unsecured funds under one-way CDARS and ICS brokered deposits in the amount of $1.1 billion, against which there was $38 million outstanding as of December 31, 2025. As of December 31, 2025, the Bank also has custodial agreements with various broker-dealers through IntraFi's IND program which provided $386.0 million of brokered deposits.

As of December 31, 2025, the Bank was also eligible to draw advances from the FHLB up to $1.3 billion based on assets pledged as collateral to the FHLB, against which the Bank borrowed none as of December 31, 2025.

The Bank may enter into repurchase agreements with broker-dealers provided adequate collateral exists. The Bank also has a back-up borrowing facility through the Discount Window at the Federal Reserve Bank of Richmond ("Federal Reserve Bank"). This facility, which can be used to borrow up to $1.4 billion, is collateralized with specific loan assets and investment securities pledged to the Federal Reserve Bank. It is anticipated that, except for periodic testing, this facility would be utilized for contingency funding only. There can be no assurance, however, that these alternative sources of liquidity will continue to be available or will be sufficient to meet our ongoing liquidity needs.

The Bank's aggregate borrowing capacity as of December 31, 2025 was $3.0 billion, which consists of $1.3 billion borrowing capacity from FHLB, $1.4 billion borrowing capacity from the Federal Reserve's Discount Window as discussed above, and $315.7 million of unencumbered HTM securities available to pledge to the FHLB or Discount Window.

The loss of deposits, including through disintermediation, is one of the primary risks to liquidity. Disintermediation occurs most commonly when rates rise and depositors withdraw deposits seeking higher rates in alternative savings and investment sources than the Bank may offer. The Bank regularly compares deposit interest rates and makes adjustments from time to time to ensure its interest rate offerings are competitive.

There is a risk that the cost of funds will increase significantly as the Bank competes for deposits or that some deposits would be lost if rates were to increase and the Bank elected not to remain competitive with its deposit rates. Under those conditions, the Bank believes that it is well positioned to use other sources of funds such as FHLB borrowings, brokered deposits, repurchase agreements and federal funds lines of credit to offset a decline in deposits in the short run, but the use of such sources may negatively impact net interest margin and earnings. The continuing elevated cost of funding has negatively impacted our net interest margin.

There can be no assurance that the mix of sources of funds available to us at any particular time in the future will be adequate to meet our future liquidity needs. The market for customer and brokered deposits is highly competitive and the risk of disintermediation is high, particularly in a high interest rate environment. Most of our noninterest-bearing deposits are operating deposits or compensating balances that are held in connection with lending relationships. The potential outflow of such deposits is a risk and may require the Bank to pay competitive rates of interest, which could significantly and negatively impact the Bank’s interest expense and net interest margin. Over the long-term, an adjustment in assets and change in business emphasis could compensate for a potential loss of deposits. The Bank also maintains a marketable investment portfolio to provide flexibility in the event of liquidity needs. The Asset Liability Committee ("ALCO") has adopted policy guidelines, which emphasize the importance of core deposits, adequate asset liquidity and a contingency funding plan.