Orange County Bancorp, Inc. /DE/

Previous wording

We are a bank holding company headquartered in Middletown, New York and registered under the BHC Act. Through our wholly owned subsidiaries, Orange Bank & Trust Company and Hudson Valley Investment Advisors, Inc., we offer full-service commercial and consumer banking products and services and trust and wealth management services to small businesses, middle-market enterprises, local municipal governments and affluent individuals in the Lower Hudson Valley region, the New York metropolitan area and nearby markets in Connecticut and New Jersey. By combining the high-touch service and relationship- based focus of a community bank with the extensive suite of financial products and services offered by our larger competitors, we believe we can capitalize on the substantial growth opportunities available in our market areas. We also offer a variety of deposit accounts to businesses and consumers, including checking accounts and a full line of municipal banking accounts through our business banking platform. These activities, together with our 16 branches and one loan production office, generate a stable source of low- cost core deposits and a diverse loan portfolio with attractive risk-adjusted yields. We also offer private banking services through Orange Bank & Trust Private Banking, a division of Orange Bank & Trust Company, and provide trust and wealth management services through Orange Bank & Trust Company’s trust services department and HVIA, which combined has $1.8 billion in assets under management at December 31, 2024. As of December 31, 2024, our assets, loans, deposits and stockholders’ equity totaled $2.5 billion, $1.8 billion, $2.2 billion and $185.5 million, respectively.

Current wording

We are a bank holding company headquartered in Middletown, New York and registered under the BHC Act. Through our wholly owned subsidiaries, Orange Bank & Trust Company and Orange Investment Advisors, Inc., we offer full-service commercial and consumer banking products and services and trust and wealth management services to small businesses, middle-market enterprises, local municipal governments and affluent individuals in the Lower Hudson Valley region, the New York metropolitan area and nearby markets in Connecticut and New Jersey. By combining the high-touch service and relationship-based focus of a community bank with the extensive suite of financial products and services offered by our larger competitors, we believe we can capitalize on the substantial growth opportunities available in our market areas. We also offer a variety of deposit accounts to businesses and consumers, including checking accounts and a full line of municipal banking accounts through our business banking platform. These activities, together with our 16 branches and one loan production office, generate a stable source of low-cost core deposits and a diverse loan portfolio with attractive risk-adjusted yields. We also offer private banking services through Orange Bank & Trust Private Banking, a division of Orange Bank & Trust Company, and provide trust and wealth management services through Orange Bank & Trust Company’s trust services department and OIA, which combined has $1.9 billion in assets under management at December 31, 2025. As of December 31, 2025, our assets, loans, deposits and stockholders’ equity totaled $2.7 billion, $2.0 billion, $2.3 billion and $284.4 million, respectively.

Previous wording

Interest rates experienced some volatility during 2024. Based on our asset sensitivity, a steepened yield curve and higher interest rates generally could have a beneficial impact on our net interest income. Conversely, a flat yield curve at lower rates would be expected to have an adverse impact on our net interest income.

Current wording

Interest rates experienced some volatility and pressure during 2025. Based on our asset sensitivity, a steepened yield curve and higher interest rates generally could have a beneficial impact on our net interest income. Conversely, a downward yield curve at lower rates would be expected to have an adverse impact on our net interest income.

Previous wording

Noninterest Income*.*Noninterest income is also a contributor to our net income. Noninterest income consists primarily of our investment advisory income and trust income generated by HVIA and our trust department. In addition, noninterest income is also impacted by net gains on the sale of investment securities, service charges on deposit accounts, earnings on bank owned life insurance and other fee income consisting primarily of debit card fee income, checkbook fees and rebates and safe deposit box rental income.

Current wording

Noninterest Income*.*Noninterest income is also a contributor to our net income. Noninterest income consists primarily of our investment advisory income and trust income generated by OIA and our trust department. In addition, noninterest income is also impacted by net gains on the sale of investment securities or other assets, service charges on deposit accounts, earnings on bank owned life insurance and other fee income consisting primarily of debit card fee income, checkbook fees and rebates and safe deposit box rental income.

Previous wording

Assets. Our total assets were $2.5 billion at December 31, 2024, an increase of $24.5 million from December 31, 2023. The increase was primarily due to increased net loan growth of approximately $67.8 million, or 3.9%, during the year. The increase in assets also included an increase in cash and due from banks of $3.0 million, or 2.0%. During 2024, investment securities decreased by $46.2 million, or 9.4%. This decrease represents management’s continued focus on increased liquidity as the maturities of securities were primarily used to enhance the Bank’s cash position and pay down borrowings.

Current wording

Assets. Our total assets were $2.7 billion at December 31, 2025, an increase of $149.5 million from December 31, 2024. The increase was primarily due to increased net loan growth of approximately $132.3 million, or 7.4%, during the year. The increase in assets also included an increase in cash and due from banks of $53.9 million, or 35.9%. During 2025, investment securities decreased by $24.4 million, or 5.5%. This decrease represents management’s continued focus on increased liquidity as the maturities of securities were primarily used to enhance the Bank’s cash position and pay-down borrowings.

Previous wording

Cash and due from banks. Cash and due from banks increased $3.0 million, or 2.0%, to $150.3 million at December 31, 2024 from $147.4 million at December 31, 2023. The increase was primarily driven by a strategic focus to increase cash balances, while paying down borrowings in order to maintain continued strong cash levels while ensuring that contingent liquidity sources are available.

Current wording

Cash and due from banks. Cash and due from banks increased $53.9 million, or 35.9%, to $204.2 million at December 31, 2025 from $150.3 million at December 31, 2024. The increase was primarily driven by strong deposit growth during the year coupled with a strategic focus to increase cash balances, while paying down borrowings in order to maintain continued strong cash levels while ensuring that contingent liquidity sources are available.

Previous wording

Net loans increased $67.8 million, or 3.9%, to $1.8 billion at December 31, 2024 from $1.7 billion at December 31, 2023 primarily due to increases in commercial real estate loans as well as increases in home equity loans and consumer loans. Commercial real estate loans increased $102.7 million, or 8.2%, to $1.4 billion at December 31, 2024 from $1.3 billion at December 31, 2023 primarily as a result of continued loan demand by our commercial real estate customers and developers, along with our strategy to expand commercial real estate lending in our market area. Consumer loans increased $1.4 million, or 3.9%, to $38.0 million at December 31, 2024 from $36.6 million at December 31, 2023. Home

Current wording

Net loans increased $132.3 million, or 7.4%, to $1.9 billion at December 31, 2025 from $1.8 billion at December 31, 2024 primarily due to increases in commercial real estate loans, commercial real estate construction loans as well as increases in commercial and industrial loans and home equity loans. Commercial real estate loans increased $118.0 million, or 8.7%, to $1.5 billion at December 31, 2025 from $1.4 billion at December 31, 2024 primarily as a result of continued loan demand by our commercial real estate customers, along with our strategy of continued expansion within commercial real estate lending in our market area. Commercial real estate construction loans increased $18.3 million, or 22.6%, to $99.3 million as of December 31, 2025 from $81.0 million as of December 31, 2024 due to continued loan

Previous wording

At December 31, 2024, $523.3 million, or 51.3% of our adjustable interest rate loans were at their interest rate floor.

Current wording

At December 31, 2025, $562.9 million, or 49.3% of our adjustable interest rate loans were at their interest rate floor.

Previous wording

Management reviews a loan for individual evaluation when it is non-performing or when it is probable at least a portion of the loan will not be collected in accordance with the original terms due to a deterioration in the financial condition of the borrower or the value of the underlying collateral if the loan is collateral dependent. When a loan is determined to be non-performing, the measurement of the loan in the allowance for credit losses is based on the fair value of the collateral for all collateral-dependent loans. Non-accrual loans are loans for which collectability is questionable and, therefore, interest on such loans will no longer be recognized on an accrual basis. All loans that become 90 days or more delinquent are placed on non-accrual status unless the loan is well secured and in the process of collection. When loans are placed on non-accrual status, unpaid accrued interest is fully reversed, and further income is recognized only to the extent received on a cash basis or cost recovery method.

Current wording

Management reviews a loan individually when it is non-performing or when it is probable at least a portion of the loan will not be collected in accordance with the original terms due to a deterioration in the financial condition of the borrower or the value of the underlying collateral if the loan is collateral dependent. When a loan is determined to be non-performing, the measurement of the loan in the allowance for credit losses is based on the fair value of the collateral for all collateral-dependent loans. Non-accrual loans are loans for which collectability is questionable and, therefore, interest on such loans will no longer be recognized on an accrual basis. All loans that become 90 days or more delinquent are placed on non-accrual status unless the loan is well secured and in the process of collection. When loans are placed on non-accrual status, unpaid accrued interest is fully reversed, and further income is recognized only to the extent received on a cash basis or cost recovery method.

Previous wording

When we acquire real estate as a result of foreclosure, the real estate is classified as real estate owned. The real estate owned is recorded at the lower of carrying amount or fair value, less estimated costs to sell. Soon after acquisition, we order a new appraisal to determine the current market value of the property. Any excess of the recorded value of the loan satisfied over the market value of the property is charged against the allowance for credit losses, or, if the existing allowance is inadequate, charged to expense of the current period. After acquisition, all costs incurred in maintaining the property are expensed. Costs relating to the development and improvement of the property, however, are capitalized to the extent of estimated fair value less estimated costs to sell.

Current wording

When we acquire real estate as a result of foreclosure, the real estate is classified as real estate owned. The real estate owned is recorded at the lower of carrying amount or fair value, less estimated costs to sell. Soon after acquisition, we order a new appraisal to determine the current market value of the property. Any excess of the recorded value of the loan satisfied over the market value of the property is charged against the allowance for credit losses, or, if the existing allowance is inadequate, charged to expense of the current period. After acquisition, all costs incurred in maintaining the property are expensed. Costs relating to the development and improvement of the property, however, are capitalized to the extent of estimated fair value less estimated costs to sell. As of December 31, 2025, the Company had no real estate owned.

Previous wording

The following table sets forth information regarding our non-performing assets. Non-performing loans aggregated approximately $6.3 million at December 31, 2024 as compared to $4.4 million at December 31, 2023.

Current wording

The following table sets forth information regarding our non-performing assets. Non-performing loans aggregated approximately $11.1 million at December 31, 2025 as compared to $6.3 million at December 31, 2024.

Previous wording

Non-performing loans at December 31, 2024 totaled $6.3 million and consisted mainly of $6.0 million related to commercial real estate loans and $293 thousand of commercial and industrial loans as well as $6 thousand of residential real estate loans. We had no other real estate owned at December 31, 2024 or 2023, respectively.

Current wording

Non-performing loans at December 31, 2025 totaled $11.1 million and consisted mainly of $8.7 million related to commercial real estate loans and $1.6 million of commercial and industrial loans as well as $844 thousand associated with home equity loans. We had no other real estate owned at December 31, 2025 or 2024, respectively.

Previous wording

Non-performing assets increased $1.9 million, or 42.3%, to $6.3 million, or 0.25% of total assets, at December 31, 2024 from $4.4 million, or 0.18% of total assets, at December 31, 2023. The increase in non- performing assets at December 31, 2024 compared to December 31, 2023 was primarily due to one commercial real estate loan participation which defaulted during 2024 and is currently recorded at $6.0 million.

Current wording

Non-performing assets increased $4.8 million, or 76.7%, to $11.1 million, or 0.42% of total assets, at December 31, 2025 from $6.3 million, or 0.25% of total assets, at December 31, 2024. The increase in non-performing assets at December 31, 2025 compared to December 31, 2024 was primarily due to several commercial and industrial loans as well as certain loans within the commercial real estate category.

Previous wording

On the basis of management’s review of our assets, we classified $44.0 million of our assets at December 31, 2024 as substandard compared to $19.6 million at December 31, 2023. We designated $20.9 million of our assets at December 31, 2024 as special mention compared to $32.8 million designated as special mention at December 31, 2023.

Current wording

On the basis of management’s review of our assets, we classified $73.7 million of our assets at December 31, 2025 as substandard compared to $44.0 million at December 31, 2024. We designated $58.4 million of our assets at December 31, 2025 as special mention compared to $20.9 million designated as special mention at December 31, 2024.

Previous wording

The allowance for credit losses increased by $895 thousand, or 3.6%, to $26.1 million, or 1.44% of total loans at December 31, 2024 from $25.2 million, or 1.44% of total loans, at December 31, 2023. The increase in the allowance for credit losses for 2024 was driven mainly by a provision of $8.7 million for one nonaccrual loan participation of a

Current wording

The allowance for credit losses increased by $2.3 million, or 8.7%, to $28.3 million, or 1.45% of total loans at December 31, 2025 from $26.1 million, or 1.44% of total loans, at December 31, 2024. The increase in the allowance for credit losses for 2025 was driven mainly by a provision of $7.8 million related to growth of our commercial real estate portfolio as well as the impact of $6.1 million in charge-offs during the year. Commercial and industrial loans represented the most significant impact on net charge-offs as a result of two relationships which had deteriorated.

Previous wording

Available for sale securities decreased $46.2 million, or 9.4%, to $443.8 million at December 31, 2024 from $489.9 million at December 31, 2023, as mortgage-backed securities decreased $32.9 million, municipal securities decreased $3.1 million, and U.S. Government agency securities decreased $10.9 million, while corporate securities increased $758 thousand. The overall decrease was primarily the result of management’s intent to increase our liquidity position and maintain the maturing investments within the cash accounts. During the first quarter of 2024, the Company recognized a net credit related to the provision for credit losses of $1.9 million. The recovery was received for proceeds from the sale of subordinated debt securities which were previously charged off during 2023. Management determined that an ACL was not required for the portfolio and the amount was reversed from the provision which reduced the ACL on investment securities to zero. The 2023 provision included the effect of a $5 million reserve associated with the write-off of an investment in Signature Bank subordinated debt.

Current wording

Available for sale securities decreased $24.4 million, or 5.5%, to $419.4 million at December 31, 2025 from $443.8 million at December 31, 2024, as mortgage-backed securities decreased $5.5 million, municipal securities decreased $7.5 million, and U.S. Government agency securities decreased $14.6 million, while corporate securities increased $3.2 million. The overall decrease was primarily the result of management’s continued intent to increase our liquidity position for funding purposes and maintain the maturing investments within the cash accounts. During the first quarter of 2024, the Company recognized a net-credit related to the provision for credit losses of $1.9 million. The recovery was received for proceeds from the sale of subordinated debt securities which were previously charged off during 2023. Management determined that an ACL was not required for the portfolio and the amount was reversed from the provision which reduced the ACL on investment securities to zero. The 2023 provision included the effect of a $5 million reserve associated with the write-off of an investment in Signature Bank subordinated debt. No credit related provision for credit losses was required to be recorded against the investment portfolio during 2025.

Previous wording

Available for sale securities are evaluated to determine if a decline in fair value below the amortized cost basis has resulted from a credit loss or other factors. An impairment related to credit factors would be recorded through an allowance for credit losses. The allowance is limited to the amount by which the security’s amortized cost basis exceeds the fair value. An impairment that has not been recorded through an allowance for credit losses shall be recorded through other comprehensive income, net of applicable taxes. Investment securities will be written down to fair value through the Consolidated Statements of Income when management intends to sell, or may be required to sell, the securities before they recover in value. Primarily all of the investment securities are backed by loans guaranteed by either U.S. government agencies or U.S government-sponsored entities, and management believes that default is highly unlikely

Current wording

Available for sale securities are evaluated to determine if a decline in fair value below the amortized cost basis has resulted from a credit loss or other factors. An impairment related to credit factors would be recorded through an allowance for credit losses. The allowance is limited to the amount by which the security’s amortized cost basis exceeds the fair value. An impairment that has not been recorded through an allowance for credit losses shall be recorded through other comprehensive income, net of applicable taxes. Investment securities will be written down to fair value through the Consolidated Statements of Income when management intends to sell, or may be required to sell, the securities before they recover in value. Primarily all of the investment securities are backed by loans guaranteed by either U.S. government agencies or U.S government-sponsored entities, and management believes that default is highly unlikely given the lack of historical credit losses and governmental backing. Management believes that the unrealized losses on these securities are a function of changes in market interest rates and credit spreads, not changes in credit quality.

Previous wording

The Company also evaluated available for sale debt securities that are in an unrealized loss position as of December 31, 2024 and determined that the declines in fair value are mainly attributable to interest rates, credit spreads, market volatility and liquidity conditions, not credit quality or other factors. No provision was recorded for the year ended December 31, 2024. During 2023, the Company wrote off approximately $5.0 million associated with Signature Bank subordinated notes.

Current wording

The Company also evaluated available for sale debt securities that are in an unrealized loss position as of December 31, 2025 and determined that the declines in fair value are mainly attributable to interest rates, credit spreads, market volatility and liquidity conditions, not credit quality or other factors. No provision was recorded for the years ended December 31, 2025 and 2024, respectively.

Previous wording

Total deposits increased $114.6 million, or 5.6%, to $2.2 billion at December 31, 2024 from $2.0 billion at December 31, 2023. Our strategic focus is to increase commercial deposit relationships through our suite of cash management products and continued attention to low-cost deposits. Our strategy remains centered on increasing business demand deposit accounts through our customer centric business development approach. Money market deposits increased $94.1 million and savings deposits increased $42.9 million while noninterest-bearing demand deposits decreased $48.1 million during 2024. Interest bearing demand deposits increased $26.2 million in 2024 due to certain seasonality of municipal deposit relationships, as well as the impact of attorney trust account growth during the year. At December 31, 2024, our core deposits (which includes all deposits except for certificates of deposit) totaled $1.9 billion, or 89.7% of our total deposits. The overall increase in deposits represented a continued strategic focus on maintaining increased liquidity during 2024. Certificates of deposit decreased $504 thousand, or 0.2% to $221.0 million at December 31, 2024 from $221.5 million at December 31, 2023, primarily due to relatively level balances of broker deposits to support loan growth. We held approximately $180.0 million in brokered deposits (excluding reciprocal deposits obtained through the Certificate Deposit Account Registry Service (CDARS) and Insured Cash Sweep (ICS) networks) at December 31, 2024 and $172.4 million in brokered deposits at December 31, 2023. Our reciprocal deposits obtained through the CDARS and ICS networks totaled $6.9 million and $92.5 million, respectively, at December 31, 2024.

Current wording

Total deposits increased $157.0 million, or 7.3%, to $2.3 billion at December 31, 2025 from $2.2 billion at December 31, 2024. We stay focused on increasing commercial deposit relationships through our suite of cash management products and continuing attention to low-cost deposits. Our strategy remains centered on increasing business demand deposit accounts through our customer centric business development approach. Noninterest-bearing demand deposits grew $74.5 million and savings deposits increased $88.4 million during 2025. Interest bearing demand deposits increased $88.5 million in 2025 due to certain seasonality of municipal deposit relationships combined with the impact of attorney trust account growth during the year. At December 31, 2025, our core deposits (which includes all deposits except for certificates of deposit) totaled $2.2 billion, or 93.1% of our total deposits. The overall increase in deposits represented a continued strategic focus on growing customer deposit relationships in order to maintain a low cost and stable funding source. Certificates of deposit decreased $62.0 million, or 28.1%, to $159.0 million at December 31, 2025 from $221.0 million at December 31, 2024, primarily due to reduced levels of brokered deposits to support loan growth as a result of the core deposit growth during the year. We held approximately $125.0 million in brokered deposits (excluding reciprocal deposits obtained through the Certificate Deposit Account Registry Service (CDARS) and Insured Cash Sweep (ICS) networks) at December 31, 2025 and $180.0 million in brokered deposits at December 31, 2024. Our reciprocal deposits obtained through the CDARS and ICS networks totaled $5.8 million and $96.0 million, respectively, at December 31, 2025.

Previous wording

As of December 31, 2024, and December 31, 2023, the aggregate amount of uninsured deposits (deposits in amounts greater than or equal to $250,000, which is the maximum amount for federal deposit insurance) was $1.1 billion and $1.0 billion, respectively. In addition, as of December 31, 2024, the aggregate amount of all our uninsured certificates of deposit was $11.6 million. The following table sets forth the maturity of these uninsured certificates of deposit as of December 31, 2024.

Current wording

As of December 31, 2025, and December 31, 2024, the aggregate amount of uninsured deposits (deposits in amounts greater than or equal to $250,000, which is the maximum amount for federal deposit insurance) was $1.3 billion and $1.1 billion, respectively. In addition, as of December 31, 2025, the aggregate amount of all our uninsured certificates of deposit was $10.5 million. The following table sets forth the maturity of these uninsured certificates of deposit as of December 31, 2025.

Previous wording

Total borrowings from the Federal Home Loan Bank of New York were $123.5 million at December 31, 2024 and $234.5 million at December 31, 2023. The decrease in borrowings was related to management’s focus on reducing borrowings with increased deposit levels. We have the capacity to borrow up to $512.2 million from the Federal Home Loan Bank of New York at December 31, 2024.

Current wording

Total borrowings from the Federal Home Loan Bank of New York were $10.0 million at December 31, 2025 and $123.5 million at December 31, 2024. The decrease in borrowings was driven by increased deposits which outpaced loan growth in 2025 and allowed for paydowns of borrowings while maintaining strong cash levels at year end. The decrease in borrowings reflects a strategic focus on actively managing liquidity sources and opportunities to reduce funding costs. We have the capacity to borrow up to $652.7 million from the Federal Home Loan Bank of New York at December 31, 2025.

Previous wording

In September 2020, we issued $20.0 million in aggregate principal amount of fixed to floating subordinated notes (the “2020 Notes”) to certain institutional investors. The 2020 Notes are non-callable for five years, have a stated maturity of September 30, 2030, and bear interest at a fixed rate of 4.25% per year until September 30, 2025. From September 30, 2025 to the maturity date or early redemption date, the interest rate will reset quarterly to a level equal to the current three-month SOFR plus 413 basis points, payable quarterly in arrears.

Current wording

In September 2025, we issued $25.0 million in aggregate principal amount of fixed to floating subordinated notes (the “2025 Notes”) to certain institutional investors. The 2025 Notes are non-callable for five years, have a stated maturity of September 30, 2035, and bear interest at a fixed rate of 6.50% per year until September 30, 2030. From September 30, 2030 to the maturity date or early redemption date, the interest rate will reset quarterly to a level equal to the then current three-month SOFR plus 320.5 basis points, payable quarterly in arrears.

Previous wording

Total stockholders’ equity increased $20.2 million, or 12.2%, to $185.5 million at December 31, 2024, from $165.4 million at December 31, 2023. The increase was primarily the result of the increase of $22.6 million in retained earnings during the current year, offset in part by a $3.6 million increase in accumulated other comprehensive loss due to a decrease in the fair market value of our securities available-for-sale during 2024.

Current wording

Total stockholders’ equity increased $98.8 million, or 53.3%, to $284.4 million at December 31, 2025, from $185.5 million at December 31, 2024. The increase was due to the combination of a common stock offering which netted approximately $43.0 million, earnings of $41.6 million, and a decrease in unrealized losses of $19.9 million on the market value of investment securities within the Company’s equity as accumulated other comprehensive income (loss) (“AOCI”), net of taxes. This reduction of the unrealized losses represents an increase in the fair market value of our securities available-for-sale during 2025.

Previous wording

accretion and net deferred loan origination costs accounted for as yield adjustments. Deferred loan fees totaled $4.9 million for each of the years ended December 31, 2024 and 2023, respectively.

Current wording

accretion and net deferred loan origination costs accounted for as yield adjustments. Deferred loan fees totaled $4.8 million and $4.9 million for each of the years ended December 31, 2025 and 2024, respectively.

Previous wording

Interest Income. Interest income increased $9.5 million, or 8.0%, to $127.2 million for the year ended December 31, 2024 from $117.8 million for the year ended December 31, 2023. This increase was the result of an increase in our average interest-earning assets which increased by $47.9 million, or 2.1%, to $2.4 billion for the year ended December 31, 2024 compared to $2.3 billion for the year ended December 31, 2023. Supporting the increase in interest income was an increase in the average yield on interest earning assets of 28 basis points to 5.31% during the year ended December 31, 2024 from 5.03% for the year ended December 31, 2023.

Current wording

Interest Income. Interest income increased $7.8 million, or 6.1%, to $135.0 million for the year ended December 31, 2025 from $127.2 million for the year ended December 31, 2024. This increase was the result of an increase in our average interest-earning assets which increased by $99.6 million, or 4.2%, to $2.5 billion for the year ended December 31, 2025 compared to $2.4 billion for the year ended December 31, 2024. Supporting the increase in interest income was an increase in the average yield on interest earning assets of 11 basis points to 5.42% during the year ended December 31, 2025 from 5.31% for the year ended December 31, 2024.

Previous wording

Interest income on loans increased by $9.8 million, or 10.2%, to $106.0 million during the year ended December 31, 2024 from $96.2 million during the year ended December 31, 2023. The increase in interest income on loans was primarily due to the increase in the average balance of loans (excluding PPP loans), combined with the effect of an increase in the average yield on loans. The average balance of loans (excluding PPP loans) increased by $76.8 million, or 4.6%, to $1.8 billion for the year ended December 31, 2024 compared to $1.7 billion for the year ended December 31, 2023. The average yield on loans increased by 29 basis points from 5.72% for the year ended December 31, 2023 to 6.01% for the year ended December 31, 2024. The increase in the average balance of loans was primarily due to our continued investment in commercial real estate, construction, and commercial and industrial loans, whereas the increase in average yield on loans was driven by a disciplined pricing approach within the market for new loan originations.

Current wording

Interest income on loans increased by $9.8 million, or 9.2%, to $115.8 million during the year ended December 31, 2025 from $106.0 million during the year ended December 31, 2024. The increase in interest income on loans was primarily due to the increase in the average balance of loans (excluding PPP loans), combined with the effect of an increase in the average yield on loans. The average balance of loans (excluding PPP loans) increased by $135.8 million, or 7.7%, to $1.9 billion for the year ended December 31, 2025 compared to $1.8 billion for the year ended December 31, 2024. The average yield on loans increased by 10 basis points from 6.01% for the year ended December 31, 2024 to 6.11% for the year ended December 31, 2025. The increase in the average balance of loans was primarily due to our continued investment in commercial real estate, construction, and commercial and industrial loans, while the increase in average yield on loans was driven by a disciplined pricing approach within the market for new loan originations.

Previous wording

Interest income on investment securities decreased by $800 thousand, or 5.7%, to $13.3 million during the year ended December 31, 2024 from $14.1 million during the year ended December 31, 2023. The decrease in interest income on securities was due to a decrease in the average balance of securities, partially offset by an increase in the average yield on securities. The average balance of securities decreased by $36.3 million, or 7.2%, to $467.1 million for the year ended December 31, 2024 compared to $503.4 million for the year ended December 31, 2023. The decrease in the average balance of securities was due to maturity and amortization of lower yielding securities during 2024 as compared to 2023. The average yield on securities increased by four basis points from 2.79% for the year ended December 31, 2023 to 2.83% for the year ended December 31, 2024. The increase in the average yield on securities resulted from higher-yielding securities purchased during a period of increasing market interest rates combined with the maturity of lower-yielding investment securities during 2024.

Current wording

Interest income on investment securities decreased by $1.1 million, or 7.9%, to $12.2 million during the year ended December 31, 2025 from $13.3 million during the year ended December 31, 2024. The decrease in interest income on securities was due to a decrease in the average balance of securities, partially offset by an increase in the average yield on securities. The average balance of securities decreased by $39.2 million, or 8.4%, to $428.0 million for the year ended December 31, 2025 compared to $467.1 million for the year ended December 31, 2024. The decrease in the average balance of securities was due to maturity and amortization of lower yielding securities during 2025 as compared to 2024. The average yield on securities increased by two basis points from 2.83% for the year ended December 31, 2024 to 2.85% for the year ended December 31, 2025. The increase in the average yield on securities resulted from higher-yielding securities purchased combined with the maturity of lower-yielding investment securities during 2025.

Previous wording

Interest income on cash and due from banks and other increased $723 thousand, or 11.1%, to $7.2 million for the year ended December 31, 2024 from $6.5 million for the year ended December 31, 2023. The increase in interest income from cash and due from banks and other was attributable to an increase in the average yield earned on cash and due from banks combined with increased average balances during the year. The average yield increased 11 basis points to 4.69% in 2024 from 4.58% in 2023 as a result of increased short-term market interest rates during the first half of 2024. Average balances for cash and due from banks increased to $153.6 million for the year ended December 31, 2024 from $142.0 million for the year ended December 31, 2023, representing an increase of $11.6 million, or 8.2%.

Current wording

Interest income on cash and due from banks and other decreased $797 thousand, or 11.0%, to $6.4 million for the year ended December 31, 2025 from $7.2 million for the year ended December 31, 2024. The decrease in interest income from cash and due from banks and other was attributable to a decrease in the average yield earned on cash and due from banks offset by a slight increase in average balances during the year. The average yield for cash and due from banks decreased 62 basis points to 4.07% in 2025 from 4.69% in 2024 as a result of decreased short-term market interest rates during 2025. Average balances for cash and due from banks increased to $158.0 million for the year ended December 31, 2025 from $153.6 million for the year ended December 31, 2024, representing an increase of $4.3 million, or 2.8%.

Previous wording

Interest Expense. Interest expense increased $6.1 million, or 20.7%, to $35.5 million for the year ended December 31, 2024 from $29.4 million for the year ended December 31, 2023. The increase in interest expense was a result of the higher interest rate environment associated with interest-bearing liabilities, primarily deposits, coupled with an increase in the average balance of interest-bearing liabilities. The average rate paid on interest-bearing liabilities increased 30 basis points to 2.20% during the year ended December 31, 2024 from 1.90% for the year ended December 31, 2023. The average balance of interest-bearing liabilities increased by $55.2 million, or 3.6%, to $1.6 billion for the year ended December 31, 2024 compared to $1.5 billion for the year ended December 31, 2023.

Current wording

Interest Expense. Interest expense decreased $4.5 million, or 12.8%, to $30.9 million for the year ended December 31, 2025 from $35.5 million for the year ended December 31, 2024. The decrease in interest expense was a result of the lower interest rate environment associated with interest-bearing liabilities, including the continued reduction of interest costs associated with lower FHLB advances and borrowings as well as a decrease in brokered deposits due to increased customer deposit levels during the year. The average rate paid on interest-bearing liabilities decreased 31 basis points to 1.89% during the year ended December 31, 2025 from 2.20% for the year ended December 31, 2024. The average balance of interest-bearing liabilities increased by $30.2 million, or 1.9%, to approximately $1.6 billion for the year ended December 31, 2025 compared to the year ended December 31, 2024.

Previous wording

Interest expense on interest-bearing deposits increased by $8.4 million, or 42.8%, to $27.9 million during the year ended December 31, 2024 from $19.5 million during the year ended December 31, 2023. The increase in interest expense on interest-bearing deposits was due to an increase in the average cost of deposits combined with an increase in the average balance of interest-bearing deposits. The average cost of interest-bearing deposits increased 47 basis points to 1.91% during the year ended December 31, 2024. The average balance of interest-bearing deposits increased by $99.3 million, or 7.3%, to $1.5 billion for the year ended December 31, 2024 compared to the year ended December 31, 2023 due to increases in the average balances of all deposit categories. The average cost of interest-bearing deposits increased due to the higher interest rate environment as we continued to experience rate pressure on all interest-bearing deposit categories, demand deposit accounts, savings, money market, and certificates of deposit accounts.

Current wording

Interest expense on interest-bearing deposits decreased by $641 thousand, or 2.3%, to $27.2 million during the year ended December 31, 2025 from $27.9 million during the year ended December 31, 2024. The decrease in interest expense on interest-bearing deposits was due to a decrease in the average cost of deposits partially offset by an increase in the average balance of interest-bearing deposits. The average cost of interest-bearing deposits decreased 17 basis points to 1.74% during the year ended December 31, 2025. The average cost of interest-bearing deposits decreased due to the lower interest rate environment as all deposit categories experienced lower costs during the year. The average balance of interest-bearing deposits increased by $105.3 million, or 7.2%, to $1.6 billion for the year ended December 31, 2025 compared to $1.5 billion for the year ended December 31, 2024 due to increases in the average balances of all deposit categories, except certificates of deposit. The reduction in the balance of certificates of deposit was due to lower brokered deposit levels as customer balances increased during 2025 and there was less reliance on brokered funding.

Previous wording

Interest expense on Federal Home Loan Bank borrowings decreased to $6.7 million for the year ended December 31, 2024 as compared to $8.9 million for the year ended December 31, 2023. The decrease in interest expense on borrowed funds was primarily due to reduced Federal Home Loan Bank advances as a result of increased deposit levels during the year which supported loan growth. The average balance of Federal Home Loan Bank advances decreased from $170.4 million for the year ended December 31, 2023 to an average balance of $126.1 million for the year ended December 31, 2024. In addition, the average rate of Federal Home Loan Bank advances remained relatively stable and only increased two basis points from 5.25% for the year ended December 31, 2023 to 5.27% for the year ended December 31, 2024. We also incurred $921 thousand in interest expense for the year ended December 31, 2024 as compared to $922 thousand for the year ended December 31, 2023 due to the issuance in September 2020 of $20.0 million in outstanding subordinated notes which carries an interest rate of 4.25%.

Current wording

Interest expense on Federal Home Loan Bank borrowings decreased to $2.2 million for the year ended December 31, 2025 as compared to $6.7 million for the year ended December 31, 2024. The decrease in interest expense on borrowed funds was primarily due to the continued reduction of Federal Home Loan Bank advances as a result of increased deposit levels during the year which supported loan growth. The average balance of Federal Home Loan Bank advances decreased from $126.2 million for the year ended December 31, 2024 to an average balance of $49.6 million for the year ended December 31, 2025. Additionally, the average rate of Federal Home Loan Bank advances experienced an 86 basis points reduction from 5.27% for the year ended December 31, 2024 to 4.41% for the year ended December 31, 2025. We did incur $1.5 million in interest expense for the year ended December 31, 2025 as compared to $921 thousand for the year ended December 31, 2024 related to the replacement of $20 million of outstanding subordinated notes issued in September 2020 which carried an interest rate of 4.25%. The replacement was part of a $25 million subordinated note issuance during September 2025 which carries an interest rate of 6.50%.

Previous wording

Net Interest Income. Net interest income increased $3.4 million, or 3.8%, to $91.8 million for the year ended December 31, 2024 from $88.4 million for the year ended December 31, 2023 due primarily to an increase in net interest margin. The net interest margin increased five basis points to 3.83% for the year ended December 31, 2024 from 3.78% for the year ended December 31, 2023 due to stability within the interest rate policy by the FRB which did not decrease rates until September 2024 coupled with a focus on managing interest costs associated with deposits and borrowings. Net interest-earning assets decreased by $7.3 million to $784.9 million for the year ended December 31, 2024 from $792.2 million for the year ended December 31, 2023. Net interest rate spread decreased by two basis points to 3.11% for the year ended December 31, 2024 from 3.13% for the year ended December 31, 2023, reflecting a 30 basis points increase in the average rate paid on interest-bearing liabilities, partially offset by a 28 basis points increase in the average yield on interest-earning assets.

Current wording

Net Interest Income. Net interest income increased $12.3 million, or 13.4%, to $104.1 million for the year ended December 31, 2025 from $91.8 million for the year ended December 31, 2024 due primarily to an increase in net interest margin. The net interest margin increased 35 basis points to 4.18% for the year ended December 31, 2025 from 3.83% for the year ended December 31, 2024 due to the increase in interest and fees on loans during the year combined with lower costs associated with interest bearing liabilities. The fed funds rate reductions by the FRB as part of its 2025 interest rate policy created lower costs associated with deposits and borrowings. Net interest-earning assets increased by $69.4 million to $854.3 million for the year ended December 31, 2025 from $784.9 million for the year ended December 31, 2024. Net interest rate spread increased by 42 basis points to 3.53% for the year ended December 31, 2025 from 3.11% for the year ended December 31, 2024, reflecting a 31 basis points decrease in the average rate paid on interest-bearing liabilities, and an 11 basis points increase in the average yield on interest-earning assets.

Previous wording

Provision for Credit Losses. Our provision for credit losses was $7.7 million for the year ended December 31, 2024 compared to $7.9 million for the year ended December 31, 2023. The decrease in the provision for credit losses primarily reflected the impact of a net recovery during 2024 associated with the previously charged-off Signature Bank subordinated debt and offset by provisions related to one nonaccrual loan participation of a commercial real estate transaction. The provision for the year ended December 31, 2024 included the recognition of credit losses associated with the participation as well as the additional provision related to the growth of the Company’s loan portfolio. The allowance for credit losses was $26.1 million, or 1.44%, of loans outstanding at December 31, 2024 compared to $25.2 million, or 1.44%, of loans outstanding at December 31, 2023.

Current wording

Provision for Credit Losses. Our provision for credit losses was $7.8 million for the year ended December 31, 2025 compared to $7.7 million for the year ended December 31, 2024. The provision for 2025 was driven mainly by growth of the Company’s loan portfolio. The provision for the year ended December 31, 2024 included a credit provision associated with the recovery of $1.9 million related to Signature Bank subordinated debt which was previously written off. No reserves for investment securities were recorded during 2025 or 2024. The allowance for credit losses was $28.3 million, or 1.45%, of loans outstanding at December 31, 2025 compared to $26.1 million, or 1.44%, of loans outstanding at December 31, 2024.

Previous wording

Noninterest income increased by $2.6 million, or 19.0%, to $16.0 million for the year ended December 31, 2024 from $13.4 million for the year ended December 31, 2023. The increase in noninterest income in the year ended December 31, 2024 was primarily due to increases in income from investment advisory income and trust income. Investment advisory income and trust income increased $1.5 million and $413 thousand, respectively, primarily the result of asset growth and the impact of equity markets and the interest rate environment. Service charges on deposit accounts increased $206 thousand directly related to customer activity. We had no investment securities gains in 2024 and $107 thousand in gains associated with investment securities for 2023.

Current wording

Noninterest income increased by $7.2 million, or 44.9%, to $23.2 million for the year ended December 31, 2025 from $16.0 million for the year ended December 31, 2024. The growth included increased fee income in each of the Company’s fee income categories, including investment advisory income, trust income, and service charges on deposit accounts. Investment advisory income and trust income increased $814 thousand and $1.0 million, respectively, primarily the result of asset growth and the impact of equity markets and the interest rate environment. The year ended December 31, 2025 also included BOLI proceeds of $3.6 million related to policy proceeds from a death benefit and $932 thousand of insurance proceeds related to a claim for a previous fraudulent incident as well as a $1.2 million gain related to the sale of a branch location, partially offset by a $568 thousand loss connected to a $15 million repositioning of our investment securities portfolio. Service charges on deposit accounts increased $349 thousand during 2025 as compared to 2024 directly related to customer activity.

Previous wording

Noninterest expense increased $8.4 million, or 14.8%, to $65.2 million during the year ended December 31, 2024 from $56.8 million during the year ended December 31, 2023. The increase in noninterest expense for the year ended December 31, 2024 as compared to the prior year was mainly due to a $2.7 million increase in salaries, a $1.5 million increase in employee benefits, a $1.2 million increase in professional fees, a $902 thousand increase in computer software expense and a $2.6 million increase in other expenses.

Current wording

Noninterest expense increased $2.7 million, or 4.1%, to $67.9 million during the year ended December 31, 2025 from $65.2 million during the year ended December 31, 2024. The increase in noninterest expense for the year ended December 31, 2025 as compared to the prior year was mainly due to a $1.9 million increase in computer software expenses and technology, a $919 thousand increase in salaries, a $684 thousand increase in employee benefits, a $398 thousand increase in advertising expense, and a $338 thousand increase in occupancy expense partially offset by a $2.1 million decrease in other expenses.

Previous wording

•Other expenses increased mainly from the recognition of increased costs associated with a nonperforming loan participation and certain costs related to a fraudulent incident within one of our branches.

Current wording

•Other expenses decreased mainly due to expenses recognized during fourth quarter 2024 related to a fraudulent incident within one of our branches and certain costs associated with a nonperforming loan participation and associated lawsuit.

Previous wording

Income Tax Expense. We recorded an income tax expense of $6.9 million for the year ended December 31, 2024, reflecting an effective tax rate of 19.9%. For the year ended December 31, 2023, we recorded an income tax expense of $7.7 million, reflecting an effective tax rate of 20.6%. The decreased tax expense was reflective of the reduction in pre-tax income during 2024.

Current wording

Income Tax Expense. We recorded an income tax expense of $9.9 million for the year ended December 31, 2025, reflecting an effective tax rate of 19.3%. For the year ended December 31, 2024, we recorded an income tax expense of $6.9 million, reflecting an effective tax rate of 19.9%. The increased tax expense was reflective of the growth in pre-tax income during 2025.

Previous wording

We conduct our business through two business segments: (1) our banking business segment, which involves the delivery of loan and deposit products to our customers through Orange Bank & Trust Company that provides revenues in our banking business segment; and (2) our wealth management business segment, which includes asset management and trust services to individuals and institutions through HVIA and Orange Bank & Trust Company that provides trust and investment management fee income in our wealth management business segment. For further information, see Note 20 of the Notes to the Audited Consolidated Financial Statements.

Current wording

We conduct our business through two business segments: (1) our banking business segment, which involves the delivery of loan and deposit products to our customers through Orange Bank & Trust Company that provides revenues in our banking business segment; and (2) our wealth management business segment, which includes asset management and trust services to individuals and institutions through OIA and Orange Bank & Trust Company that provides trust and investment management fee income in our wealth management business segment. For further information, see Note 20 of the Notes to the Audited Consolidated Financial Statements.

Previous wording

Comparison at or for the years ended December 31, 2024 and 2023. The market value of assets under management and/or administration at December 31, 2024 and 2023 was approximately $1.8 billion at December 31, 2024, and $1.6 billion at December 31, 2023. This includes assets held at both Orange Bank & Trust Company and HVIA at December 31, 2024 and 2023, respectively. This increase was due to continued acquisition of new assets under management combined with an increase in the market value of assets under management.

Current wording

Comparison at or for the years ended December 31, 2025 and 2024. The market value of assets under management and/or administration at December 31, 2025 and 2024 was approximately $1.9 billion at December 31, 2025, and $1.8 billion at December 31, 2024. This includes assets held at both Orange Bank & Trust Company and OIA at December 31, 2025 and 2024, respectively. This increase was due to continued acquisition of new assets under management combined with an increase in the market value of assets under management.

Previous wording

Our income related to our wealth management business segment, which we record as noninterest income, increased $1.9 million, or 18.5%, to $12.2 million for the year ended December 31, 2024 compared to $10.3 million for the year ended December 31, 2023. The increase was mainly due to the impact of equity markets and the interest rate environment during the year.

Current wording

Our income related to our wealth management business segment, which we record as noninterest income, increased $1.9 million, or 15.2%, to $14.1 million for the year ended December 31, 2025 compared to $12.2 million for the year ended December 31, 2024. The increase was mainly due to the impact of equity markets and growth of assets during the year.

Previous wording

Our expenses related to our wealth management business segment, which we record as noninterest expense, increased $1.4 million, or 17.5%, to $9.1 million for the year ended December 31, 2024 compared to $7.8 million for the year ended December 31, 2023. The increase was due to the continued growth in our operations and compensation as well as an investment in technology and staffing to support the future growth of the wealth management segment.

Current wording

Our expenses related to our wealth management business segment, which we record as noninterest expense, decreased $216 thousand, or 2.4%, to $8.9 million for the year ended December 31, 2025 compared to $9.1 million for the year ended December 31, 2024. The decrease was due to a management focus on operating costs as well as a reduction in compensation costs during 2025.