Hilltop Holdings Inc.

Previous wording

Consolidated income before income taxes during the three months ended March 31, 2026 included the following contributions from our reportable business segments.

Current wording

Consolidated income before income taxes during the three and six months ended June 30, 2026 included the following contributions from our reportable business segments.

Previous wording

During the three months ended March 31, 2026, we declared and paid total common dividends of $11.8 million.

Current wording

During the six months ended June 30, 2026, we declared and paid total common dividends of $23.4 million.

Previous wording

On April 23, 2026, our board of directors declared a quarterly cash dividend of $0.20 per common share, payable on May 22, 2026 to all common stockholders of record as of the close of business on May 8, 2026.

Current wording

On July 23, 2026, our board of directors declared a quarterly cash dividend of $0.22 per common share, a 10% increase from the prior quarter, payable on August 21, 2026 to all common stockholders of record as of the close of business on August 7, 2026.

Previous wording

In January 2026, our board of directors authorized a new stock repurchase program through January 2027, pursuant to which we are authorized to repurchase, in the aggregate, up to $125.0 million of our outstanding common stock, which is inclusive of repurchases to offset dilution related to grants of stock-based compensation. During the three months ended March 31, 2026, Hilltop paid $47.5 million to repurchase an aggregate of 1,238,216 shares of our common stock at an average price of $38.40 per share pursuant to the stock repurchase program.

Current wording

In January 2026, our board of directors authorized a new stock repurchase program through January 2027, pursuant to which we were originally authorized to repurchase, in the aggregate, up to $125.0 million of our outstanding common stock. In July 2026, our board of directors authorized an increase to the aggregate amount of common stock we may repurchase under this program to $200.0 million, an increase of $75.0 million, which is inclusive of repurchases to offset dilution related to grants of stock-based compensation. During the six months ended June 30, 2026, we paid $94.5 million to repurchase an aggregate of 2,488,216 shares of our common stock at an average price of $37.99 per share pursuant to the stock repurchase program. As a result of share repurchases during 2026, Hilltop has approximately $106 million of available share repurchase capacity through the expiration of the 2026 stock repurchase program in January 2027.

Previous wording

We present certain measures in our selected financial data that are not measures of financial performance recognized by GAAP. “Tangible book value per common share” is defined as our total stockholders’ equity reduced by goodwill and other intangible assets, divided by total common shares outstanding. “Tangible common equity to tangible assets” is defined as our total stockholders’ equity reduced by goodwill and other intangible assets, divided by total assets reduced by goodwill and other intangible assets. These measures are used by management, investors and analysts to assess the use of equity. For companies such as ours that have engaged in business combinations, purchase accounting can result in the recording of significant amounts of goodwill and other intangible assets related to those transactions. You should not view this disclosure as a substitute for results determined in accordance with GAAP, and our disclosure is not necessarily comparable to that of other companies that use non-GAAP measures. The following table reconciles these non-GAAP financial measures to the most comparable GAAP financial measures, “book value per common share” and “equity to total assets” (dollars in thousands, except per share data).

Current wording

We present certain measures in our selected financial data that are not measures of financial performance recognized by GAAP. “Tangible book value per common share” is defined as our total stockholders’ equity reduced by goodwill and other intangible assets, divided by total common shares outstanding. “Tangible common equity to tangible assets” is defined as our total stockholders’ equity reduced by goodwill and other intangible assets, divided by total assets reduced by goodwill and other intangible assets. These measures are used by management, investors and analysts to assess the use of equity. For companies such as ours that have engaged in business combinations, purchase accounting can result in the recording of significant amounts of goodwill and other intangible assets related to those transactions. You should not view this disclosure as a substitute for results determined in accordance with GAAP, and our disclosure is not necessarily comparable to that of other companies that use non-GAAP measures. The following tables reconcile these non-GAAP financial measures to the most comparable GAAP financial measures, “book value per common share” and “equity to total assets” (dollars in thousands, except per share data).

Previous wording

Our balance sheet, operating results and certain metrics during 2025 and the first quarter of 2026 reflected uncertainty around general economic, market and business conditions that we expect will remain uncertain for the remainder of 2026. The extent of the impacts of uncertain economic conditions on our financial performance during the remainder of 2026 will depend in part on developments outside of our control, including, among others, changes in political environment, the impact of tariffs and reciprocal tariffs, the timing and significance of further changes in U.S. Treasury yields and mortgage interest rates, and a volatile economic forecast. These conditions, coupled with exposure to changes in funding costs, inflationary pressures, and international armed conflicts and their impact on supply chains within our business segments during the first quarter of 2026 have had, and are expected to continue to have, an adverse impact on our operating results during the remainder of 2026.

Current wording

Our balance sheet, operating results and certain metrics during 2025 and the first six months of 2026 reflected uncertainty around general economic, market and business conditions that we expect will remain uncertain for the remainder of 2026. The extent of the impacts of uncertain economic conditions on our financial performance during the remainder of 2026 will depend in part on developments outside of our control, including, among others, changes in political environment, the impact of tariffs and reciprocal tariffs, the timing and significance of further changes in U.S. Treasury yields and mortgage interest rates, and a volatile economic forecast. These conditions, coupled with exposure to changes in funding costs, inflationary pressures, elevated energy prices, and international armed conflicts and their impact on supply chains within our business segments during the first six months of 2026 have had, and are expected to continue to have, an adverse impact on our operating results during the remainder of 2026.

Previous wording

Historically, high-profile banking failures periodically increase market uncertainty and concerns associated with banking sector liquidity positions, increase regulatory scrutiny and underscore the importance of maintaining access to diverse sources of funding. In light of these events, we have continued our efforts to monitor deposit flows and balance sheet trends to ensure that our liquidity needs and financial flexibility are maintained. During 2025, deposit costs remained elevated despite actions we took to reduce the interest paid on our interest-bearing deposits. Our cost of deposits decreased during the three months ended March 31, 2026, compared to the same period of 2025, as a result of the rate reductions since September 2025. Additionally, at March 31, 2026, we continued to access core deposits from our Hilltop Securities Federal Deposit Insurance Corporation (“FDIC”) insured sweep program, while the Bank was not utilizing any of its Federal Home Loan Bank (“FHLB”) borrowing capacity.

Current wording

Historically, high-profile banking failures periodically increase market uncertainty and concerns associated with banking sector liquidity positions, increase regulatory scrutiny and underscore the importance of maintaining access to diverse sources of funding. In light of these events, we have continued our efforts to monitor deposit flows and balance sheet trends to ensure that our liquidity needs and financial flexibility are maintained. During 2025, deposit costs remained elevated despite actions we took to reduce the interest paid on our interest-bearing deposits. Our cost of deposits decreased during the six months ended June 30, 2026, compared to the same period of 2025, as a result of the rate reductions since September 2025. Additionally, at June 30, 2026, we continued to access core deposits from our Hilltop Securities Federal Deposit Insurance Corporation (“FDIC”) insured sweep program, while the Bank was not utilizing any of its Federal Home Loan Bank (“FHLB”) borrowing capacity.

Previous wording

We expect uncertainties related to economic headwinds discussed above, the impact of interest rate movements on the shape and inversions of the yield curve and the continued active management of deposits and related funding costs that persisted through 2025 and into the first quarter of 2026, to continue during the remainder of 2026.

Current wording

We expect uncertainties related to economic headwinds discussed above, the impact of interest rate movements on the shape and inversions of the yield curve and the continued active management of deposits and related funding costs that persisted through 2025 and into the first half of 2026, to continue during the remainder of 2026.

Previous wording

Continuing macroeconomic challenges related to mortgage loan origination volumes, customer sensitivity to interest rates and resulting demand for certain products have resulted in a challenging environment associated with the mortgage origination segment’s short- and long-term financial condition, resulting in variability in their operating results.

Current wording

Continuing macroeconomic challenges related to mortgage loan origination volumes, customer sensitivity to interest rates and resulting demand for certain products, including recent shift in market expectations related to a prolonged elevated interest rate environment, have resulted in a challenging environment associated with the mortgage origination segment’s short- and long-term financial condition, resulting in variability in their operating results.

Previous wording

We generate revenue from net interest income and from noninterest income. Net interest income represents the difference between the income earned on our assets, including our loans and investment securities, and our cost of funds, including the interest paid on the deposits and borrowings that are used to support our assets. Net interest income is a significant contributor to our operating results. Fluctuations in interest rates, as well as the amounts and types of interest-earning assets and interest-bearing liabilities we hold, affect net interest income. We generated $112.1 million in net interest income during the three months ended March 31, 2026, compared with net interest income of $105.1 million during the three months ended March 31, 2025. The change in reportable business segment net interest income during the three months ended March 31, 2026, compared with the same period in 2025, primarily reflected improvements within the banking segment and corporate.

Current wording

We generate revenue from net interest income and from noninterest income. Net interest income represents the difference between the income earned on our assets, including our loans and investment securities, and our cost of funds, including the interest paid on the deposits and borrowings that are used to support our assets. Net interest income is a significant contributor to our operating results. Fluctuations in interest rates, as well as the amounts and types of interest-earning assets and interest-bearing liabilities we hold, affect net interest income. We generated $227.9 million in net interest income during the six months ended June 30, 2026, compared with net interest income of $215.8 million during the six months ended June 30, 2025. The change in reportable business segment net interest income during the six months ended June 30, 2026, compared with the same period in 2025, primarily reflected improvements within the banking segment and corporate.

Previous wording

In the aggregate, we generated $188.4 million and $213.3 million in noninterest income during the three months ended March 31, 2026 and 2025, respectively. The decrease in noninterest income during the three months ended March 31, 2026, compared to the same period in 2025, was predominantly attributable, as noted in the segment results table previously presented, primarily due to a decrease in pre-tax gains associated with merchant bank equity investment activity within corporate, partially offset by increased noninterest income within our broker-dealer segment from principal transactions, commissions and fees and within our mortgage origination segment from net gains from sale of loans.

Current wording

In the aggregate, we generated $388.4 million and $406.0 million in noninterest income during the six months ended June 30, 2026 and 2025, respectively. The decrease in noninterest income during the six months ended June 30, 2026, compared to the same period in 2025, was predominantly attributable, as noted in the segment results table previously presented, to a decrease in pre-tax gains associated with merchant bank equity investment activity within corporate, partially offset by increased noninterest income within our broker-dealer segment from principal transactions, commissions and fees and within our mortgage origination segment from net gains from sale of loans.

Previous wording

Income applicable to common stockholders during the three months ended March 31, 2026 was $37.8 million, or $0.64 per diluted share, compared to $42.1 million, or $0.65 per diluted share, during the three months ended March 31, 2025. Hilltop’s financial results during the three months ended March 31, 2026, compared with three months ended March 31, 2025, are discussed in more detail below and within the respective “Banking Segment,” “Broker-Dealer Segment,” “Mortgage Origination Segment” and “Corporate” segment results sections that follow.

Current wording

Income applicable to common stockholders during the three months ended June 30, 2026 was $36.5 million, or $0.63 per diluted share, compared to $36.1 million, or $0.57 per diluted share, during the three months ended June 30, 2025. Income applicable to common stockholders during the six months ended June 30, 2026 was $74.4 million, or $1.27 per diluted share, compared to $78.2 million, or $1.22 per diluted share, during the six months ended June 30, 2025. Hilltop’s financial results during the three and six months ended June 30, 2026, compared with the three and six months ended June 30, 2025, are discussed in more detail below and within the respective “Banking Segment,” “Broker-Dealer Segment,” “Mortgage Origination Segment” and “Corporate” segment results sections that follow.

Previous wording

Certain items included in net income for the three months ended March 31, 2026 and 2025 resulted from purchase accounting associated with the merger of PlainsCapital Corporation with and into a wholly owned subsidiary of Hilltop on November 30, 2012, the FDIC-assisted transaction whereby the Bank acquired certain assets and assumed certain liabilities of FNB, the acquisition of SWS Group, Inc. in a stock and cash transaction, and the acquisition of The Bank of River Oaks in an all-cash transaction (collectively, the “Bank Transactions”). Income before income taxes during the three months ended March 31, 2026 and 2025 included net accretion on earning assets and liabilities of $1.3 million and $1.1 million, respectively, and amortization of identifiable intangibles of $0.2 million and $0.3 million, respectively, related to the Bank Transactions.

Current wording

Certain items included in net income for the three and six months ended June 30, 2026 and 2025 resulted from purchase accounting associated with the merger of PlainsCapital Corporation with and into a wholly owned subsidiary of Hilltop on November 30, 2012, the FDIC-assisted transaction whereby the Bank acquired certain assets and assumed certain liabilities of FNB, the acquisition of SWS Group, Inc. in a stock and cash transaction, and the acquisition of The Bank of River Oaks in an all-cash transaction (collectively, the “Bank Transactions”). Income before income taxes during the three months ended June 30, 2026 and 2025 included net accretion on earning assets and liabilities of $0.8 million and $0.5 million, respectively, and amortization of identifiable intangibles of $0.2 million and $0.2 million, respectively, related to the Bank Transactions. During the six months ended June 30, 2026 and 2025, income before income taxes included net accretion on earning assets and liabilities of $2.1 million and $1.6 million, respectively, and amortization of identifiable intangibles of $0.5 million and $0.5 million, respectively, related to the Bank Transactions.

Previous wording

During the three months ended March 31, 2026 and 2025, purchase accounting contributed 4 and 4 basis points, respectively, to our consolidated taxable equivalent net interest margin of 3.15% and 2.86%, respectively. The purchase accounting activity was primarily related to the accretion of discount of loans which totaled $1.3 million and $1.1 million during the three months ended March 31, 2026 and 2025, respectively, associated with the Bank Transactions.

Current wording

was primarily related to the accretion of discount of loans which totaled $0.8 million and $0.5 million during the three months ended June 30, 2026 and 2025, respectively, and $2.1 million and $1.6 million during the six months ended June 30, 2026 and 2025, respectively, associated with the Bank Transactions.

Previous wording

The table below provides additional details regarding our consolidated net interest income (dollars in thousands).

Current wording

The tables below provide additional details regarding our consolidated net interest income (dollars in thousands).

Previous wording

On a consolidated basis, the change in net interest income during the three months ended March 31, 2026, compared with the same period in 2025, was primarily due to decreased costs of deposits from rate decreases, partially offset by decreased loans held for investment yield and interest-bearing deposits in other institutions yields from rate decreases. Refer to the discussion in the “Banking Segment” section that follows for more details on the changes in net interest income, including the component changes in the volume of average interest-earning assets and interest-bearing liabilities and changes in the rates earned or paid on those items.

Current wording

On a consolidated basis, the change in net interest income during the three and six months ended June 30, 2026, compared with the same periods in 2025, were primarily due to decreased funding costs on our deposits from rate decreases, partially offset by lower yields on loans held for investment and interest-bearing deposits in other institutions from rate decreases. Refer to the discussion in the “Banking Segment” section that follows for more details on the changes in net interest income, including the component changes in the volume of average interest-earning assets and interest-bearing liabilities and changes in the rates earned or paid on those items.

Previous wording

The provision for (reversal of) credit losses is determined by management as the amount necessary to maintain the allowance for credit losses at the amount of expected credit losses inherent within the loans held for investment portfolio. The amount of expense and the corresponding level of allowance for credit losses for loans are based on our evaluation of the collectability of the loan portfolio based on historical loss experience, reasonable and supportable forecasts, and other significant qualitative and quantitative factors. Substantially all of our consolidated provision for (reversal of) credit losses is related to the banking segment. During the three months ended March 31, 2026, the provision for credit losses was primarily driven by a build in the allowance related to specific reserves and net charge-offs, partially offset by changes in the U.S. economic outlook associated with collectively evaluated loans and loan portfolio changes, including

Current wording

The provision for (reversal of) credit losses is determined by management as the amount necessary to maintain the allowance for credit losses at the amount of expected credit losses inherent within the loans held for investment portfolio. The amount of expense and the corresponding level of allowance for credit losses for loans are based on our evaluation of the collectability of the loan portfolio based on historical loss experience, reasonable and supportable forecasts, and other significant qualitative and quantitative factors. Substantially all of our consolidated provision for (reversal of) credit losses is related to the banking segment. During the three months ended June 30, 2026, the reversal of credit losses was primarily driven by changes in the U.S. economic outlook associated with collectively evaluated loans and loan portfolio changes, including changes in loan mix and risk rating grade migration, partially offset by a build in the allowance related to specific reserves, within the banking segment since the prior quarter. The provision for credit losses

Previous wording

changes in loan mix and risk rating grade migration, within the banking segment since the prior quarter. Refer to the discussion under the heading “Financial Condition – Allowance for Credit Losses on Loans” for more details regarding the significant assumptions and estimates involved in estimating credit losses.

Current wording

during the six months ended June 30, 2026 was primarily driven by a build in the allowance related to specific reserves and net charge-offs, partially offset by changes in the U.S. economic outlook associated with collectively evaluated loans and loan portfolio changes, including changes in loan mix and risk rating grade migration, within the banking segment. Refer to the discussion under the heading “Financial Condition – Allowance for Credit Losses on Loans” for more details regarding the significant assumptions and estimates involved in estimating credit losses.

Previous wording

Noninterest income decreased during the three months ended March 31, 2026, compared with the same period in 2025, primarily due to the recognition within corporate of a pre-tax gain of $27.8 million associated with the sale of operations by a merchant bank equity investment in the first quarter of 2025, partially offset by net increases within the broker-dealer segment’s fixed income services, wealth management and structured finance business lines and an increase in net gains from sale of loans within our mortgage origination segment.

Current wording

Noninterest income increased during the three months ended June 30, 2026, compared with the same period in 2025, primarily due to net increases within our broker-dealer segment’s structured finance, wealth management and fixed income services business lines, partially offset a decrease within our mortgage origination segment due to multiple Settlement Agreement & Releases (the “Settlements”) whereby PrimeLending received an aggregate of $9.5 million from the respective parties in the second quarter of 2025. Noninterest income decreased during the six months ended June 30, 2026, compared with the same period in 2025, primarily due to the recognition within corporate of a pre-tax gain of $27.1 million associated with the sale of operations by a merchant bank equity investment in the first quarter of 2025 and due to the decrease noted above within the mortgage origination, partially offset by net increases within the broker-dealer segment’s structured finance, wealth management and fixed income business lines.

Previous wording

Noninterest expense decreased during the three months ended March 31, 2026, compared with the same period in 2025, primarily due to a net decrease in employees’ compensation and benefits within corporate associated with the sale of a merchant bank equity investment in the first quarter of 2025, partially offset by an increase within our broker-dealer segment associated with increases in employees’ compensation and benefits. During 2025 and through the first quarter of 2026, we continued to experience increases in certain noninterest expenses, compared with respective prior periods, including compensation, occupancy, and software costs, due to inflationary pressures. We expect such inflationary headwinds to continue during the remainder of 2026.

Current wording

Noninterest expense increased during the three months ended June 30, 2026, compared with the same period in 2025, primarily due to an increase within our broker-dealer segment associated with increases in variable compensation expense and other segment operating costs, partially offset by a decrease in lender paid closing costs within our mortgage origination segment. Noninterest expense increased during the six months ended June 30, 2026, compared to the same period in 2025, primarily due to an increase in professional fees within our banking segment due to the settlement and receipt of $6.5 million during the first quarter of 2025 that reimbursed the Bank for legal fees previously incurred and an increase within our broker-dealer segment associated with increases in variable compensation expense and other segment operating costs, partially offset by a net decrease in employees’ compensation and benefits within corporate associated with the sale of a merchant bank equity investment in the first quarter of 2025. During 2025 and through the second quarter of 2026, we continued to experience increases in certain noninterest expenses, compared with respective prior periods, including compensation, occupancy, and software costs, due to inflationary pressures. We expect such inflationary headwinds to continue during the remainder of 2026.

Previous wording

Effective income tax rates during the three months ended March 31, 2026 and 2025 were 22.6% and 22.7%, respectively. During each of the three months ended March 31, 2026 and 2025, the effective tax rate was higher than the applicable statutory rate primarily due to the impact of nondeductible expenses, nondeductible compensation expense and other permanent adjustments, partially offset by investments in tax-exempt instruments.

Current wording

Effective income tax rates during the three months ended June 30, 2026 and 2025 were 24.2% and 23.4%, respectively, and during the six months ended June 30, 2026 and 2025 were 23.4% and 23.1%, respectively. During the three and six months ended June 30, 2026 the effective tax rate was higher than the applicable statutory rate primarily due to the impact of nondeductible expenses, nondeductible compensation expense and other permanent adjustments, partially offset by investments in tax-exempt instruments. During the three and six months ended June 30, 2025, the effective tax rate was higher than the applicable statutory rate primarily due to the impact of nondeductible compensation expense, other nondeductible expenses and other permanent adjustments, partially offset by investments in tax-exempt instruments.

Previous wording

The increase in income before income taxes during the three months ended March 31, 2026, compared with the same period in 2025, was primarily due to an increase in net interest income and a decrease in the provision for credit losses, partially offset by an increase in noninterest expense. Changes to net interest income related to the component changes in the volume of average interest-earning assets and interest-bearing liabilities and changes in the rates earned or paid on those items are discussed in more detail below.

Current wording

The decrease in income before income taxes during the three months ended June 30, 2026, compared with the same period in 2025, was primarily due to a decrease in the reversal of credit losses and an increase in noninterest expense, partially offset by an increase in net interest income. The increase in income before income taxes during the six months ended June 30, 2026, compared with the same period in 2025, was primarily due to an increase in net interest income and a decrease in the provision for credit losses, partially offset by an increase in noninterest expense. Changes to net interest income related to the component changes in the volume of average interest-earning assets and interest-bearing liabilities and changes in the rates earned or paid on those items are discussed in more detail below.

Previous wording

As discussed in more detail below, the banking segment's overall deposit costs decreased during the first quarter of 2026, primarily due to lower rates on interest-bearing deposits on certain products and product tiers in conjunction with rate reductions by the Federal Reserve to lower the effective funds rate towards the end of 2025. We are continuing to actively manage our overall deposit costs and will continue to seek opportunities to further lower interest-bearing deposit rates if they present themselves. Future decisions on the costs of deposits will be influenced by various factors, including, but not limited to competitive pressures, broader economic conditions, future changes in the target range for the federal funds rate, customer behavior and our liquidity position at that time.

Current wording

As discussed in more detail below, the banking segment's overall deposit costs decreased during the first six months of 2026, primarily due to lower rates on interest-bearing deposits on certain products and product tiers in conjunction with rate reductions by the Federal Reserve to lower the effective funds rate towards the end of 2025. Future decisions on the costs of deposits will continue to be influenced by various factors, including, but not limited to competitive pressures, broader economic conditions, future changes in the target range for the federal funds rate, customer behavior and our liquidity position at that time.

Previous wording

During the three months ended March 31, 2026 and 2025, purchase accounting contributed 5 and 3 basis points, respectively, to the banking segment’s taxable equivalent net interest margin of 3.39% and 2.97%, respectively. These purchase accounting items are primarily related to accretion of discount of loans associated with the Bank Transactions presented in the Consolidated Operating Results section.

Current wording

During the three months ended June 30, 2026 and 2025, purchase accounting contributed 3 and 3 basis points, respectively, to the banking segment’s taxable equivalent net interest margin of 3.42% and 3.17%, respectively. During the six months ended June 30, 2026 and 2025, purchase accounting contributed 4 and 3 basis points, respectively, to the banking segment’s taxable equivalent net interest margin of 3.40% and 3.07%, respectively. These purchase accounting items are primarily related to accretion of discount of loans associated with the Bank Transactions presented in the Consolidated Operating Results section.

Previous wording

The table below provides additional details regarding our banking segment’s net interest income (dollars in thousands).

Current wording

The tables below provide additional details regarding our banking segment’s net interest income (dollars in thousands).

Previous wording

The increase in net interest income during the three months ended March 31, 2026, compared to the same period in 2025, as noted in the table above, was driven by decreased funding costs on our deposit products from rate decreases. This decrease was partially offset by lower earnings on interest‑earning assets due to reduced balances and lower yields and by increased interest income from loans held for investment reflecting higher loan volumes. The average rate paid on interest-bearing liabilities decreased 67 basis points from 3.23% for the three months ended March 31, 2025 to 2.56% for the three months ended March 31, 2026, while the average yield on interest-earning assets decreased 5 basis points from 5.20% for the three months ended March 31, 2025 to 5.15% for the three months ended March 31, 2026.

Current wording

and by increased interest income from loans held for investment reflecting higher loan volumes. The average rate paid on interest-bearing liabilities decreased 63 basis points from 3.19% for the six months ended June 30, 2025 to 2.56% for the six months ended June 30, 2026, while the average yield on interest-earning assets decreased 9 basis points from 5.26% for the six months ended June 30, 2025 to 5.17% for the six months ended June 30, 2026.

Previous wording

Our portfolio includes loans that periodically reprice or mature prior to the end of an amortized term. The extent and timing of this impact on interest income will ultimately be driven by the timing, magnitude and frequency of interest rate and yield curve movements, as well as changes in market conditions and timing of management strategies. At March 31, 2026, approximately $501 million of our floating rate loans held for investment remained at or below their applicable rate floor, exclusive of our mortgage warehouse lending program, of which approximately 18% are not scheduled to reprice for more than one year based upon agreed-upon terms. If interest rates were to continue to fall, the impact on our interest income for certain variable-rate loans would be limited by these rate floors. If interest rates rise, yields on the portion of our loan portfolio that remain at applicable rate floors would rise more slowly than increases in market interest rates, unless such loans are refinanced or repaid. Competition for loan growth could also continue to put pressure on new loan origination rates.

Current wording

Our portfolio includes loans that periodically reprice or mature prior to the end of an amortized term. The extent and timing of this impact on interest income will ultimately be driven by the timing, magnitude and frequency of interest rate and yield curve movements, as well as changes in market conditions and timing of management strategies. At June 30, 2026, approximately $455 million of our floating rate loans held for investment remained at or below their applicable rate floor, exclusive of our mortgage warehouse lending program, of which approximately 16% are not scheduled to reprice for more than one year based upon agreed-upon terms. If interest rates were to continue to fall, the impact on our interest income for certain variable-rate loans would be limited by these rate floors. If interest rates rise, yields on the portion of our loan portfolio that remain at applicable rate floors would rise more slowly than increases in market interest rates, unless such loans are refinanced or repaid. Competition for loan growth could also continue to put pressure on new loan origination rates.

Previous wording

Additionally, within our banking segment, the composition of the deposit base and ultimate cost of funds on deposits and net interest income are affected by the level of market interest rates, the interest rates and products offered by competitors, the volatility of equity markets and other factors. Deposit products and pricing structures relative to the market are regularly evaluated to maintain competitiveness over time. As discussed above, our cost of deposits decreased during the three months ended March 31, 2026, compared to the same period of 2025. We expect such costs during the remainder of 2026 will continue to be influenced by various factors, including, but not limited to competitive pressures, broader economic conditions, future changes in the target range for the federal funds rate, customer behavior and our liquidity position at that time. The Bank’s deposit base primarily includes a combination of commercial, wealth and public funds deposits, without a high level of industry concentration. At March 31, 2026, total estimated uninsured deposits were $5.9 billion, or approximately 56% of total deposits, while estimated uninsured deposits, excluding collateralized deposits of $640.8 million and internal accounts of $448.2 million, were $4.8 billion, or approximately 46% of total deposits.

Current wording

Additionally, within our banking segment, the composition of the deposit base and ultimate cost of funds on deposits and net interest income are affected by the level of market interest rates, the interest rates and products offered by competitors, the volatility of equity markets and other factors. Deposit products and pricing structures relative to the market are regularly evaluated to maintain competitiveness over time. As discussed above, our cost of deposits decreased during the three and six months ended June 30, 2026, compared to the same periods in 2025. We expect such costs during the remainder of 2026 will continue to be influenced by various factors, including, but not limited to competitive pressures, broader economic conditions, future changes in the target range for the federal funds rate, customer behavior and our liquidity position at that time. The Bank’s deposit base primarily includes a combination of commercial, wealth and public funds deposits, without a high level of industry concentration. At June 30, 2026, total estimated uninsured deposits were $5.7 billion, or approximately 55% of total deposits, while estimated uninsured deposits, excluding collateralized deposits of $580.0 million and internal accounts of $388.6 million, were $4.8 billion, or approximately 45% of total deposits.

Previous wording

The banking segment retained approximately $54.9 million and $62.5 million in mortgage loans originated by the mortgage origination segment during the three months ended March 31, 2026 and 2025, respectively. These loans are purchased by the banking segment at par. For origination services provided, the banking segment reimburses the mortgage origination segment for direct origination costs associated with these mortgage loans, in addition to payment of a correspondent fee. The correspondent fees are eliminated in consolidation. The determination of mortgage loan retention levels by the banking segment will be impacted by, among other things, an ongoing review of the prevailing mortgage rates, balance sheet positioning at Hilltop and the banking segment’s outlook for commercial loan growth.

Current wording

The banking segment retained approximately $58.7 million and $43.2 million in mortgage loans originated by the mortgage origination segment during the three months ended June 30, 2026 and 2025, respectively, and $113.6 million and $105.7 million in mortgage loans originated by the mortgage origination segment during the six months ended June 30, 2026 and 2025, respectively. These loans are purchased by the banking segment at par. For origination services provided, the banking segment reimburses the mortgage origination segment for direct origination costs associated with these mortgage loans, in addition to payment of a correspondent fee. The correspondent fees are eliminated in consolidation. The determination of mortgage loan retention levels by the banking segment will be impacted by, among other things, an ongoing review of the prevailing mortgage rates, balance sheet positioning at Hilltop and the banking segment’s outlook for commercial loan growth.

Previous wording

The banking segment’s provision for (reversal of) credit losses has been subject to significant year-over-year and quarterly changes primarily attributable to the effects of changes in economic outlook, macroeconomic forecast assumptions and the resulting impact on reserves. During the three months ended March 31, 2026, the provision for credit losses was primarily driven by a build in the allowance related to specific reserves and net charge-offs, partially offset by changes in the U.S. economic outlook associated with collectively evaluated loans and loan portfolio changes, including changes in loan mix and risk rating grade migration, within the banking segment since the prior quarter. The net impact to the allowance of changes associated with individually evaluated loans during the three months ended March 31, 2026 included a provision for credit losses of $4.0 million, while collectively evaluated loans during the three months ended March 31, 2026 included a reversal of credit losses of $2.3 million. The change in the allowance for credit losses during the noted period also reflected other factors including, but not limited to, loan mix, and changes in loan balances and qualitative factors from the prior quarter. The change in the allowance for credit losses during the three months ended March 31, 2026 was also impacted by net charge-offs of $4.3 million. Refer to the discussion in the “Financial Condition – Allowance for Credit Losses on Loans” section that follows for more details regarding the significant assumptions and estimates involved in estimating credit losses.

Current wording

The banking segment’s provision for (reversal of) credit losses has been subject to significant year-over-year and quarterly changes primarily attributable to the effects of changes in economic outlook, macroeconomic forecast assumptions and the resulting impact on reserves. During the three months ended June 30, 2026, the reversal of credit losses was primarily driven by changes in the U.S. economic outlook associated with collectively evaluated loans and loan portfolio changes, including changes in loan mix and risk rating grade migration, partially offset by a build in the allowance related to specific reserves, since the prior quarter. The provision for credit losses during the six months ended June 30, 2026 was primarily driven by a build in the allowance related to specific reserves and net charge-offs, partially offset by changes in the U.S. economic outlook associated with collectively evaluated loans and loan portfolio changes, including changes in loan mix and risk rating grade migration. The net impact to the allowance of changes associated

Previous wording

During the three months ended March 31, 2025, the increase in the provision for credit losses was primarily driven by a build in the allowance related to loan portfolio changes and specific reserves, including changes in loan mix and risk rating grade migration, partially offset by net charge-offs and changes in the U.S. economic outlook associated with collectively evaluated loans within the banking segment since the prior quarter. The net impact to the allowance of changes associated with collectively and individually evaluated loans during the three months ended March 31, 2025 included a provision for credit losses of $7.7 million and $1.7 million, respectively. The change in the allowance for credit losses during the noted period also reflected other factors including, but not limited to, loan growth, loan mix and changes in risk grades and qualitative factors from the prior quarter. The change in the allowance for credit losses during the three months ended March 31, 2025 was also impacted by net charge-offs of $4.3 million.

Current wording

During the three months ended June 30, 2025, the reversal of credit losses was primarily driven by changes in the U.S. economic outlook associated with collectively evaluated loans, loan portfolio changes and net charge-offs, partially offset by a build in the allowance related to specific reserves, including changes in loan mix and risk rating grade migration, since the prior quarter. The provision for credit losses during the six months ended June 30, 2025 was primarily driven a build in the allowance related to loan portfolio changes and specific reserves, including changes in loan mix and risk rating grade migration, partially offset by net charge-offs and changes in the U.S. economic outlook associated with collectively evaluated loans. The net impact to the allowance of changes associated with individually evaluated loans during the three and six months ended June 30, 2025 included a provision for credit losses of $1.8 million and $3.4 million, respectively, while collectively evaluated loans during the three and six months ended June 30, 2025 included a reversal of credit losses of $9.1 million and $1.4 million, respectively. The changes in the allowance for credit losses during the noted periods also reflected other factors including, but not limited to, the change in economic scenario, loan mix, and changes in loan balances and qualitative factors from the prior quarter. The change in the allowance for credit losses during the three and six months ended June 30, 2025 was also impacted by net charge-offs of $0.9 million and $5.2 million, respectively.

Previous wording

The banking segment’s noninterest income increased slightly during the three months ended March 31, 2026, compared to the same period in 2025.

Current wording

The banking segment’s noninterest income increased slightly during the three and six months ended June 30, 2026, compared to the same periods in 2025, primarily due an increase in trust management fees, significantly offset by the receipt of a legal restitution payment during the second quarter of 2025 that compensated the Bank for previously incurred losses.

Previous wording

The banking segment’s noninterest expense increased during the three months ended March 31, 2026, compared to the same period in 2025, primarily due to increases in professional fees, employees’ compensation and benefits and occupancy and equipment expenses. The increase in professional fees during 2026, compared to the same period in 2025, was driven by the settlement and receipt of $6.5 million during the first quarter of 2025 that reimbursed the Bank for legal fees previously incurred.

Current wording

The banking segment’s noninterest expense increased during the three and six months ended June 30, 2026, compared to the same periods in 2025, primarily due to increases in professional fees, employees’ compensation and benefits and software costs. The increase in professional fees during the six months ended June 30, 2026, compared to the same period in 2025, was significantly driven by the settlement and receipt of $6.5 million during the first quarter of 2025 that reimbursed the Bank for legal fees previously incurred.

Previous wording

and structured finance business lines. These increases were offset by a decrease in the public finance services business line. The increase in the fixed income business line’s net revenues was due primarily to improved revenue earned from sales activities in both taxable and municipal capital markets divisions. The increase in the wealth management business line’s net revenue was driven by an increase in asset management fees revenues generated from customer assets under management and earnings on over-the-counter securities transactions. The increase in the structured finance business line’s net revenues was primarily due to an increase in commissions earned on the sale of agricultural insurance products and commodities transactions offset by a decrease in housing revenue period over period. The decrease in the public finance services business lines was due to a decrease in advisory fees. Income before income taxes for the three months ended March 31, 2026 was impacted by the increases in net revenue as described above and a net increase in noninterest expense.

Current wording

The increases in net revenue and income before income taxes for the three and six months ended June 30, 2026, compared with the same periods in 2025, were primarily due to improved revenues within the fixed income services, wealth management and structured finance business lines. These increases were offset by a decrease in the public finance services business line. The increase in the fixed income business line’s net revenues was due primarily to improved revenue earned from sales activities in both taxable and municipal capital markets divisions. The increase in the wealth management business line’s net revenue was driven by an increase in asset management fee revenues generated from managed customer assets and transactional commission revenues. The increase in the structured finance business line’s net revenues was primarily due to an increase in housing revenue period over period and an increase in commissions earned on the sale of agricultural insurance products and commodities transactions. The decrease in the public finance services business lines was due to a decrease in advisory fees. Income before income taxes for the three and six months ended June 30, 2026 were impacted by the increases in net revenue as described above and a net increase in noninterest expense.

Previous wording

Noninterest income increased during the three months ended March 31, 2026, compared with the same period in 2025, primarily due to increases in principal transactions, commissions and fees and investment banking, advisory and administrative fees.

Current wording

Noninterest income increased during the three and six months ended June 30, 2026, compared with the same periods in 2025, primarily due to increases in principal transactions, commissions and fees and investment banking, advisory and administrative fees.

Previous wording

Principal transactions, commissions and fees increased during the three months ended March 31, 2026, compared with the same period in 2025, primarily due to increases in commodities and over-the-counter sales commissions. This increase was offset by the overall decrease in revenue from trading activities within our fixed income services business line due to a volatile market.

Current wording

Principal transactions, commissions and fees increased during the three and six months ended June 30, 2026, compared with the same periods in 2025, primarily due to increases in commodities and over-the-counter sales commissions, income from hedging activities and an increase in housing revenue period over period.

Previous wording

Investment banking advisory and administrative fees increased during the three and three months ended March 31, 2026, compared with the same period in 2025, primarily due to increases in fees earned from managed assets offset by a decrease in fees earned from public finance advisory services.

Current wording

Investment banking advisory and administrative fees increased during the three and six months ended June 30, 2026, compared with the same periods in 2025, primarily due to increases in fees earned from managed assets offset by a decrease in fees earned from public finance advisory services.

Previous wording

The increase in noninterest expense during the three months ended March 31, 2026, compared with the same period in 2025, was primarily due to increases in commissions, which was in line with the increase in commissions revenue earned period over period. The increase in variable compensation expense was partially offset by decreases in occupancy and general operating expenses.

Current wording

The increase in noninterest expense during the three and six months ended June 30, 2026, compared with the same periods in 2025, were primarily due to increases in variable compensation, which were in line with the increases in production revenue earned period over period. This increase in variable compensation expense was partially offset by decreases in employee benefits, primarily employee health insurance and severance expenses incurred in the prior year. Additionally, segment operating costs increased during the three and six months ended June 30, 2026, compared with the same periods in 2025, primarily due to increased legal and quotation costs.

Previous wording

The mortgage lending business is subject to variables that can impact loan origination volume, including seasonal transaction volumes and interest rate fluctuations. Historically, the mortgage origination segment has experienced increased loan origination volume from home purchases during the spring and summer months to varying degrees, when more people tend to move and buy or sell homes. A decrease in mortgage interest rates tends to result in increased loan origination volume from refinancings, while an increase in mortgage interest rates tends to result in decreased loan origination volume from refinancings. While changes in mortgage interest rates have historically had a lesser impact on home purchases volume than on refinancing volume, an increase in average mortgage rates since 2022 have negatively impacted home purchase volume through the first quarter of 2026. The effect of this trend was compounded by periods of broader economic uncertainty during that time. See details regarding loan origination volume in the table below.

Current wording

The mortgage lending business is subject to variables that can impact loan origination volume, including seasonal transaction volumes and interest rate fluctuations. Historically, the mortgage origination segment has experienced increased loan origination volume from home purchases during the spring and summer months to varying degrees, when more people tend to move and buy or sell homes. A decrease in mortgage interest rates tends to result in increased loan origination volume from refinancings, while an increase in mortgage interest rates tends to result in decreased loan origination volume from refinancings. While changes in mortgage interest rates have historically had a lesser impact on home purchases volume than on refinancing volume, the sharp increase in average mortgage rates during 2022 and their continued elevation has adversely affected home purchase volume through the first half of 2026. This impact was further amplified by broader economic uncertainty during the same period. See details regarding loan origination volume in the table below.

Previous wording

Recent trends, as well as typical historical patterns in loan origination volume from home purchases and refinancings because of movements in mortgage interest rates, may not be indicative of future loan origination volumes. During 2025 and through the first quarter of 2026, certain events initially triggered as early as 2022 have continued to challenge total mortgage market origination volumes because of their effect on the broader economy. These factors include higher

Current wording

Recent trends, as well as typical historical patterns in loan origination volume from home purchases and refinancings because of movements in mortgage interest rates, may not be indicative of future loan origination volumes. During 2025 and through the first half of 2026, certain events initially triggered as early as 2022 have continued to challenge total mortgage market origination volumes because of their effect on the broader economy. These factors include higher average interest rates during this period when compared to the average of the three years prior to 2023, actions and communications by the Federal Reserve and ongoing geopolitical events. These events have adversely impacted the willingness and ability of some mortgage origination segment’s customers to conduct mortgage transactions. While