UNITED BANKSHARES INC/WV

Overview

The following table sets forth certain consolidated income statement information of United:

Net income for the second quarter and first six months of 2026 was $131.38 million and $255.58 million, respectively, as compared to earnings of $120.72 million and $205.03 million for the second quarter and first six months of 2025. Diluted earnings per share were $0.95 for the second quarter of 2026 and $0.85 for the second quarter of 2025. Diluted earnings per share were $1.83 for the first six months of 2026 as compared to $1.44 for the first six months of 2025. On a linked-quarter basis, net income for the first quarter of 2026 was $124.20 million or $0.89 per diluted share.

As previously mentioned, United completed its acquisition of Piedmont on January 10, 2025. The financial results of Piedmont are included in United’s results from the acquisition date. As a result of the acquisition, United recorded acquisition-related costs for the Piedmont merger of $1.32 million for the second quarter of 2025 and $31.36 million for the first six months of 2025, including a provision for credit losses of $18.73 million for purchasednon-PCD loans recorded in the first quarter of 2025.

For the second quarter of 2026, United’s annualized return on average assets was 1.56% and return on average shareholders’ equity was 9.53% as compared to 1.49% and 9.05% for the second quarter of 2025. United’s annualized return on average assets was 1.49% and return on average shareholders’ equity was 9.08% for the first quarter of 2026. United’s annualized return on average assets for the first six months of 2026 was 1.53% and return on average shareholders’ equity was 9.31% as compared to 1.28% and 7.78% for the first six months of 2025. For the second quarter and first half of 2026, United’s annualized return on average tangible common equity, anon-GAAP measure, was 15.15% and 14.77%, respectively, as compared to 14.67% and 12.67% for the second quarter and first half of 2025, respectively. United’s annualized return on average tangible common equity was 14.40% for the first quarter of 2026.

Net interest income for the second quarter of 2026 increased $10.78 million, or 3.92% from the second quarter of 2025. The increase of $10.78 million in net interest income occurred because total interest income decreased $3.00 million while total interest expense decreased $13.77 million from the second quarter of 2025. Net interest income for the first half of 2026 increased $33.24 million or 6.22% from the first half of 2025. The increase of $33.24 million in net interest income occurred because total interest income increased $9.28 million while total interest expense decreased $23.95 million from the first half of 2025. Net interest income for the second quarter of 2026 was relatively flat from the first quarter of 2026, increasing $2.80 million, or less than 1%. The slight increase of $2.80 million in net interest income occurred because total interest income increased $2.27 million while total interest expense decreased $529 thousand from the first quarter of 2026.

The provision for credit losses was $4.96 million and $12.74 million for the second quarter and first half of 2026, respectively, while the provision for credit losses was $5.89 million and $34.99 million for the second quarter and first half of 2025. The provision for credit losses was $7.78 million for the first quarter of 2026. The decrease in the provision for credit losses for the first half of 2026 was mainly due to the previously mentioned $18.73 million of provision recorded on purchasednon-PCD loans from Piedmont.

For the second quarter of 2026, noninterest income increased $7.05 million or 22.40% from the second quarter of 2025 while noninterest income for the first six months of 2026 increased $11.56 million or 18.94% from the first six months of 2025. These increases were primarily due to increased fees from brokerage services, net gains on investment securities and other noninterest income. Noninterest income for the second quarter of 2026 increased $4.44 million, or 13.04%, from the first quarter of 2026.

Noninterest expense for the second quarter of 2026 increased $6.70 million or 4.52% from the second quarter of 2025 primarily due to increases in employee compensation and employee benefits. For the first six months of 2026, noninterest expense increased $5.94 million or 1.97% from the first six months of 2025 driven by increases in employee compensation, employee benefits, and equipment expense partially reduced by merger-related expenses from the Piedmont acquisition in the first six months of 2025. Noninterest expense for the second quarter of 2026 increased $1.90 million, or 1.24%, from the first quarter of 2026.

Income taxes for the second quarter of 2026 were $32.77 million as compared to $31.37 million for the second quarter of 2025. For the first six months of 2026 and 2025 income tax expense was $64.55 million and $53.99 million, respectively. These increases in income tax expense for the 2026 time periods above were primarily due to higher earnings partially offset by lower effective tax rates. Income tax expense increased $977 thousand from the first quarter of 2026 due mainly to increased earnings partially offset by a lower effective tax rate. For the quarters ended June 30, 2026 and 2025, United’s effective tax rate was 19.96% and 20.62%, respectively. The effective tax rate for the first six months of 2026 and 2025 was 20.16% and 20.85%, respectively. For the quarter ended March 31, 2026, United’s effective tax rate was 20.38%.

The following discussion explains in more detail the consolidated results of operations by major category.

Net Interest Income

Net interest income represents the primary component of United’s earnings. It is the difference between interest income from earning assets and interest expense incurred to fund these assets. Net interest income is impacted by changes in the volume and mix of interest-earning assets and interest-bearing liabilities, as well as changes in market interest rates. Such changes, and their impact on net interest income in 2026 and 2025, are presented below.

Net interest income for the second quarter of 2026 was $285.31 million, which was an increase of $10.78 million or 3.92% from the second quarter of 2025. The $10.78 million increase in net interest income occurred because total interest income decreased $3.00 million while total interest expense decreased $13.77 million from the second quarter of 2025. Net interest income for the first half of 2026 was $567.83 million, which was an increase of $33.24 million or 6.22% from the first half of 2025. The $33.24 million increase in net interest income occurred because total interest income increased $9.28 million while total interest expense decreased $23.95 million from the first half of 2025. On a linked-quarter basis, net interest income for the second quarter of 2026 was relatively flat from the first quarter of 2026, increasing $2.80 million or less than 1%. The $2.80 million slight increase in net interest income occurred because total interest income increased $2.27 million while total interest expense decreased $529 thousand from the first quarter of 2026.

For the purpose of this remaining discussion, net interest income is presented on a fullytax-equivalent basis to provide a comparison among all types of interest earning assets. The fullytax-equivalent basis adjusts for thetax-favored status of income from certain loans and investments. Although this is anon-GAAP measure, United’s management believes this measure is more widely used within the financial services industry and provides better comparability of net interest income arising from taxable andtax-exempt sources. United uses this measure to monitor net interest income performance and to manage its balance sheet composition.

Fullytax-equivalent net interest income for the second quarter of 2026 was $286.10 million, an increase of $10.77 million or 3.91% from the second quarter of 2025. The increase in fullytax-equivalent net interest income was primarily due to a lower rate paid on average interest-bearing deposits and an increase in average net loans partially offset by a lower yield on average net loans and an increase in average interest-bearing deposits. The rate paid on average interest-bearing deposits decreased 38 basis points from the second quarter of 2025. Average net loans increased $970.63 million, or 4.10%, from the second quarter of 2025. The yield on average net loans decreased 27 basis points from the second quarter of 2025. Acquired loan accretion income decreased $6.76 million from the second quarter of 2025. Average interest-bearing deposits increased $900.48 million, or 4.59%, from the second quarter of 2025. The net interest margin was 3.81% for both the second quarter of 2026 and the second quarter of 2025.

Fullytax-equivalent net interest income for the first half of 2026 increased $33.23 million, or 6.20%, from the first half of 2025. The increase in fullytax-equivalent net interest income was primarily due to an increase in average net loans and a lower rate paid on average interest-bearing deposits. These increases to fullytax-equivalent net interest income were partially offset by a lower yield on average net loans and an increase in average interest-bearing deposits. Average net loans increased $1.18 billion, or 5.02%, from the first half of 2025. The rate paid on average interest-bearing deposits decreased 37 basis points from the first half of 2025. The yield on average net loans decreased 17 basis points from the first half of 2025. Acquired loan accretion income decreased $5.27 million from the first half of 2025. Average interest-bearing deposits increased $1.07 billion, or 5.51%, from the first half of 2025. The net interest margin was 3.80% and 3.75% for the first half of 2026 and the first half of 2025, respectively.

On a linked-quarter basis, fullytax-equivalent net interest income for the second quarter of 2026 was relatively flat from the first quarter of 2026, increasing $2.80 million, or less than 1%. The net interest margin was 3.81% and 3.80% for second quarter of 2026 and the first quarter of 2026, respectively. The interest spread for the second quarter of 2026 increased a basis point to 3.07% from the first quarter of 2026 due to a 3 basis point decrease in the average cost of funds partially offset by a 2 basis point decrease in the yield on average earning assets. The decrease in the average cost of funds was primarily due to a 2 basis point decrease in the rate paid on average interest-bearing deposits. The decrease in the yield on average earning assets was driven by a 6 basis point decrease in the yield on average net loans partially offset by a 19 basis point increase in the yield on average investment securities. Acquired loan accretion income was $5.00 million for the second quarter of 2026, a decrease of $2.47 million from the first quarter of 2026 which contributed to an approximately 4 basis point decrease in the interest spread and in the net interest margin. The increase in the yield on average investment securities reflects United’s strategic purchases of higher yielding investment securities throughout 2026.

United’s fullytax-equivalent net interest income also includes the impact of acquisition accounting fair value adjustments. The following table provides the discount/premium and net accretion impact to fullytax-equivalent net interest income for the three months ended June 30, 2026, June 30, 2025 and March 31, 2026 and the six months ended June 30, 2026 and June 30, 2025:

The following tables reconcile the difference between net interest income and fullytax-equivalent net interest income for the three months ended June 30, 2026, June 30, 2025 and March 31, 2026 and the six months ended June 30, 2026 and June 30, 2025.

The following table shows the unaudited consolidated daily average balance of major categories of assets and liabilities for the three-month periods ended June 30, 2026 and 2025, respectively, with the interest and rate earned or paid on such amount. The interest income and yields on federally nontaxable loans and investment securities are presented on a fullytax-equivalent basis using the statutory federal income tax rate of 21% for the three-month period ended June 30, 2026 and 2025. Interest income on all loans and investment securities was subject to state income taxes.

The following table shows the unaudited consolidated daily average balance of major categories of assets and liabilities for the three-month periods ended June 30, 2026 and March 31, 2026, respectively, with the interest and rate earned or paid on such amount. The interest income and yields on federally nontaxable loans and investment securities are presented on a fullytax-equivalent basis using the statutory federal income tax rate of 21% for the three-month period ended June 30, 2026 and March 31, 2026. Interest income on all loans and investment securities was subject to state income taxes.

The following table shows the unaudited consolidated daily average balance of major categories of assets and liabilities for thesix-month periods ended June 30, 2026 and 2025, respectively, with the interest and rate earned or paid on such amount. The interest income and yields on federally nontaxable loans and investment securities are presented on a fullytax-equivalent basis using the statutory federal income tax rate of 21% for thesix-month period ended June 30, 2026 and 2025. Interest income on all loans and investment securities was subject to state income taxes.

Provision for Credit Losses

The provision for credit losses was $4.96 million and $12.74 million for the second quarter and first half of 2026, respectively, as compared to a provision for credit losses of $5.89 million and $34.99 million for the second quarter and first half of 2025, respectively. On a linked-quarter basis, the provision for credit losses for the first quarter of 2026 was $7.78 million. The provision for credit losses for the first quarter and first half of 2025 included provision expense of $18.73 million recorded for purchasednon-PCD loans from Piedmont. United’s provision for credit losses relates to its portfolio of loans and leases, available-for-sale securities andheld-to-maturity securities are discussed in more detail in the following paragraphs.

For the quarter ended June 30, 2026, the provision for loan and lease losses was $4.96 million as compared to a provision for loan and lease losses of $5.89 million for the quarter ended June 30, 2025. The provision for loan and lease losses for the first six months of 2026 was $12.74 million as compared to a provision for loan and lease losses of $34.99 million for the first six months of 2025. The higher amount of provision expense for the first half of 2025 was mainly due to the previously mentioned provision expense of $18.73 million recorded for purchasednon-PCD loans from Piedmont. Net charge-offs for the second quarter and first six months of 2026 were $5.06 million and $10.75 million, respectively, as compared to net charge-offs of $8.35 million and $16.39 million, respectively, for the second quarter and first six months of 2025. The lower amount of net charge-offs for 2026 as compared to 2025 was primarily due to decreased charge-offs within the consumer and other commercial real estate nonowner-occupied loan segments. On a linked-quarter basis, the provision for loan and lease losses was $7.78 million for the first quarter of 2026. Net charge-offs were $5.70 million for the first quarter of 2026.

Annualized net charge-offs as a percentage of average loans and leases, net of unearned income for the second quarter and first half of 2026 was 0.08% and 0.09%, respectively, as compared to annualized net charge-offs of 0.14% for both time periods in 2025. Annualized net charge-offs as a percentage of average loans and leases, net of unearned income for the first quarter of 2026 was 0.09%.

The following table shows a summary of United’s nonperforming assets including nonperforming loans and other real estate owned (“OREO”) at June 30, 2026 and December 31, 2025:

United maintains an allowance for loan and lease losses and a reserve for lending-related commitments. The combined allowance for loan losses and reserve for lending-related commitments is considered the allowance for credit losses. At June 30, 2026, the allowance for credit losses was $336.73 million as compared to $332.59 million at December 31, 2025.

At June 30, 2026, the allowance for loan and lease losses was $299.50 million as compared to $297.52 million at December 31, 2025. The allowance for loan and lease losses at June 30, 2026 saw the largest increase in the reserves for the commercial real estate nonowner-occupied loan segment from year-end 2025 due to increased outstanding loan balances and an increase in the allowance for individually evaluated loans. The largest decrease in reserves at June 30, 2026 was for the real estate construction and development loan segment due to an improvement in the historical loss rate and decreased outstanding loan balances. As a percentage of loans and leases, net of unearned income, the allowance for loan and lease losses was 1.20% for both June 30, 2026 and December 31, 2025. The ratio of the allowance for loan and lease losses to nonperforming loans and leases or coverage ratio was 270.68% and 293.22% at June 30, 2026 and December 31, 2025, respectively. The slight decrease in this ratio was due mainly to a larger increase in nonperforming loans as compared to the increase in the allowance for loan and lease losses.

United continues to evaluate risks which may impact its loan and lease portfolios. Reserves are initially determined based on losses identified from the PD/LGD and Cohort models which utilize the Company’s historical information. Then, any qualitative adjustments are applied to account for the Company’s view of the future and other factors. If current conditions underlying any qualitative adjustment factor were deemed to be materially different than historical conditions, an adjustment was made for that factor.

The second quarter of 2026 qualitative adjustments include analyses of the following:

United’s review of the allowance for loan and lease losses at June 30, 2026 produced increased reserves in two of the four loan categories as compared to December 31, 2025. The allowance related to the commercial, financial & agricultural loan pool, consisting of the owner and nonowner-occupied commercial real estate and other commercial loan segments, increased $8.02 million due to increased outstanding loan balances. The consumer loan segment reserve increased $988 thousand primarily due to an increase in the quarterly maximum loss experience utilized within the reasonable and supportable forecast adjustment as well as increased outstanding loan balances. The real estate construction and development loan segment reserve decreased $6.65 million due to decreased outstanding loan balances as well as improvement in the reasonable and supportable adjustment. The residential real estate loan segment reserve decreased $377 thousand due to an improvement in historical loss rates.

An allowance is established for estimated lifetime losses for loans that are individually assessed. Nonperforming commercial loans and leases are regularly reviewed to identify expected credit losses. A loan is individually assessed for expected credit losses when the loan does not share similar characteristics with other loans in the portfolio. Measuring expected credit losses of a loan requires judgment and estimates, and the eventual outcomes may differ from those estimates. Expected credit losses are measured based upon the present value of expected future cash flows from the loan discounted at the loan’s effective rate or the fair value of collateral if the loan is collateral dependent. When the selected measure is less than the recorded investment in the loan, an expected credit loss has occurred. The allowance for loans and leases that were individually assessed was $17.68 million at June 30, 2026 and $8.04 million at December 31, 2025. In comparison toyear-end, this element of the allowance increased $9.64 million due to collateral weaknesses identified in several relationships which necessitated individually assessed reserves and increases to reserves previously identified.

Management believes that the allowance for credit losses of $336.73 million at June 30, 2026 is appropriate to provide for expected losses on existing loans and lending-related commitments based on information currently available. United’s loan administration policies are focused on the risk characteristics of the loan portfolio in terms of loan approval and credit quality. The commercial loan portfolio is monitored for possible concentrations of credit in one or more industries. Management has lending limits as a percentage of capital per type of credit concentration in an effort to ensure adequate diversification within the portfolio. Most of United’s commercial loans are secured by real estate located in United’s footprint. It is the opinion of management that these commercial loans do not pose any unusual risks and that adequate consideration has been given to these loans in establishing the allowance for credit losses.

The provision for credit losses related to held to maturity securities for the second quarter of 2026 and 2025 was immaterial. The allowance for credit losses related to held to maturity securities was $14 thousand and $16 thousand, respectively, as of June 30, 2026 and December 31, 2025. There was no provision for credit losses recorded on available for sale investment securities for the first half of 2026 and 2025 and no allowance for credit losses on available for sale investment securities as of June 30, 2026 and December 31, 2025.

Management is not aware of any potential problem loans or leases, trends or uncertainties, which it reasonably expects, will materially impact future operating results, liquidity, or capital resources which have not been disclosed. Additionally, management has disclosed all known material credits, which cause management to have serious doubts as to the ability of such borrowers to comply with the loan repayment schedules.

Other Income

Other income consists of all revenues, which are not included in interest and fee income related to earning assets. Noninterest income has been and will continue to be an important factor for improving United’s profitability. Recognizing the importance, management continues to evaluate areas where noninterest income can be enhanced.

Noninterest income for the second quarter of 2026 was $38.51 million, an increase of $7.05 million or 22.40% from the second quarter of 2025. Noninterest income for the first half of 2026 was $72.57 million, an increase of $11.56 million or 18.94% from the first half of 2025. These increases were driven primarily by increases in fees from brokerage services and net gains on investment securities.

Fees from brokerage services for the second quarter and first half of 2026 increased $1.90 million or 39.12% and $3.66 million or 34.83%, respectively, from the second quarter and first half of 2025 due to higher volume driven by growth in the business.

Net gains on investment securities were $2.79 million for the second quarter of 2026 as compared to net gains on investment securities of $425 thousand for the second quarter of 2025. The net gains on investment securities for the second quarter of 2026 included a gain of $5.86 million as a result of the sale of an unaffiliated company in which United held an investment, a $5.66 million gain from a VISA share exchange, and a $1.00 million unrealized fair value net gain on equity securities. Partially offsetting these gains on investment securities was a loss of $9.73 million on the sale of available for sale investment securities. For the first six months of 2026, net gains on investment securities were $5.05 million as compared to net gains on investment securities of $946 thousand for the first six months of 2025. Net gains on investment securities for the first half of 2026 included the aforementioned gain as a result of the sale of an unaffiliated company in which United held an investment, the VISA share exchange gain and unrealized fair value net gain on equity securities as well as a net gain of $2.29 million on the sale of equity securities in the first quarter of 2026. Partially offsetting these gains on investment securities was the aforementioned loss on the sale of available for sale investment securities.

Other noninterest income for the second quarter and first half of 2026 increased $1.95 million or 92.72% and $2.67 million or 98.05% from the second quarter and first half of 2025, respectively. These increases in other noninterest income were primarily due to higher market values of underlying investments associated with postretirement benefit plans, which was largely offset by an increase in postretirement benefit costs recorded in noninterest expense as described in the “Other Expenses” section of this MD&A.

Income from bank-owned life insurance (“BOLI”) for the first half of 2026 decreased $860 thousand or 12.31% from the first half of 2025 due primarily to death proceeds of $1.07 million in the first half of 2025 partially offset by income on BOLI policies added from the Piedmont acquisition and an increase in the cash surrender value of insurance policies.

On a linked-quarter basis, noninterest income for the second quarter of 2026 increased of $4.44 million, or 13.04%, from the first quarter of 2026 driven by a $2.71 million increase in other noninterest income and smaller increases in several other categories of noninterest income. The increase in other noninterest income was primarily due to higher market values of underlying investments associated with postretirement benefit plans, which was largely offset by an increase in postretirement benefit costs recorded in noninterest expense.

Other Expenses

Just as management continues to evaluate areas where noninterest income can be enhanced, it strives to improve the efficiency of its operations to reduce costs. Other expenses include all items of expense other than interest expense, the provision for credit losses, and income taxes. Noninterest expense for the second quarter of 2026 was $154.72 million, which was an increase of $6.70 million or 4.52% from the second quarter of 2025. For the first half of 2026, noninterest expense was $307.53 million, which was an increase of $5.94 million or 1.97% from the first half of 2025. The second quarter and first six months of 2025 included $1.32 million and $12.63 million, respectively, of merger-related expenses from the Piedmont acquisition.

Employee compensation for the second quarter and first half of 2026 increased $3.62 million or 5.75% and $6.25 million or 5.05%, respectively, from the second quarter and first half of 2025. The increase in employee compensation was primarily due to higher salaries, brokerage commissions, employee incentives, and stock-based compensation costs. Included in employee compensation for the second quarter and first half of 2025 were $310 thousand and $1.46 million, respectively, in merger-related expenses.

Employee benefits expense for the second quarter of 2026 increased $2.86 million or 21.30% from the second quarter of 2025. This increase in employee benefits was primarily due to higher postretirement benefit costs. Employee benefits expense for the first half of 2026 increased $5.55 million or 20.77%, from the first half of 2025. This increase in employee benefits was primarily due to higher post-retirement benefit and Federal Insurance Contributions Act (“FICA”) costs.

Net occupancy for the first half of 2026 increased $995 thousand or 3.96% from the first half of 2025. This increase was due mainly to increased building maintenance, real property taxes and utilities costs.

Equipment expense for the second quarter and first half of 2026 increased $884 thousand or 10.34% and $1.04 million or 6.08%, respectively, from the second quarter and first half of 2025. These increases were due to higher equipment maintenance expense.

Data processing expense for the second quarter and first half of 2026 decreased $804 thousand or 10.11% and $2.26 million or 13.76%, respectively, from the second quarter and first half of 2025. The decrease in data processing was primarily due to technology contract renegotiations.

Other expense for the second quarter of 2026 decreased $812 thousand or 2.18% from the second quarter of 2025. Within other expense for the second quarter of 2026, consulting fees declined $1.98 million and merger-related expenses decreased $961 thousand from the second quarter of 2025. These decreases within other expense were partially offset by increases of $1.32 million in the amortization of investment tax credits and $923 thousand in the expense for the reserve for unfunded commitments. Other expense for the first half of 2026 decreased $6.24 million or 7.64% from the first half of 2025. Within other expense, merger-related expenses decreased $6.96 million and the amortization of core deposit intangibles declined $1.01 million. Partially offsetting these decreases was an increase in the expense for the reserve for unfunded commitments of $1.24 million due to an increase in outstanding loan commitments. The expense for the reserve for unfunded loan commitments for the first half of 2025 included $4.06 million in merger-related expense.

On a linked-quarter basis, noninterest expense for the second quarter of 2026 increased $1.90 million or 1.24% from the first quarter of 2026 due primarily to an increase in employee compensation of $3.06 million. The increase in employee compensation was primarily due to the timing of annual salary increases, stock-based compensation costs, and employee incentives. Partially offsetting this increase was a decrease of $2.57 million in other noninterest expense. Within other expense, the expense for the reserve for unfunded commitments decreased $1.80 million which reflected a smaller increase in outstanding loan commitments during the second quarter of 2026 as compared to the increase during the first quarter of 2026.

Income Taxes

For the second quarter of 2026, income tax expense was $32.77 million as compared to $31.37 million in the second quarter of 2025. For the first half of 2026, income tax expense was $64.55 million as compared to $53.99 million in the first half of 2025. On a linked-quarter basis, income tax expense increased $977 thousand or 3.07% from the first quarter of 2026. All of these increases in income tax expense were primarily due to higher earnings partially offset by lower effective tax rates. United’s effective tax rate was 19.96% for the second quarter of 2026, 20.62% for the second quarter of 2025 and 20.38% for the first quarter of 2026. For the first half of 2026 and 2025, United’s effective tax rate was 20.16% and 20.85%, respectively.

Liquidity and Capital Resources

In the opinion of management, United maintains liquidity that is sufficient to satisfy its depositors’ requirements and the credit needs of its customers. Like all banks, United depends upon its ability to renew maturing deposits and other liabilities on a daily basis and to acquire new funds in a variety of markets. A significant source of funds available to United is “core deposits”. Core deposits include certain demand deposits, statement and special savings and NOW accounts. These deposits are relatively stable, and they are the lowest cost source of funds available to United. Short-term borrowings have also been a significant source of funds. These include federal funds purchased and securities sold under agreements to repurchase as well as advances from the FHLB. Repurchase agreements represent funds which are obtained as the result of a competitive bidding process.

Liquid assets are cash and those items readily convertible to cash. All banks must maintain sufficient balances of cash and near-cash items to meet theday-to-day demands of customers and United’s cash needs. Other than cash and due from banks, the available for sale securities portfolio and maturing loans are the primary sources of liquidity.

The goal of liquidity management is to ensure the ability to access funding which enables United to efficiently satisfy the cash flow requirements of depositors and borrowers and meet United’s cash needs. Liquidity is managed by monitoring funds’ availability from a number of primary sources. Substantial funding is available from cash and cash equivalents, unused short-term borrowing and a geographically dispersed network of branches providing access to a diversified and substantial retail deposit market.

Short-term needs can be met through a wide array of outside sources such as correspondent and downstream correspondent federal funds and utilization of Federal Home Loan Bank advances.

Other sources of liquidity available to United to provide long-term as well as short-term funding alternatives, in addition to FHLB advances, are long-term certificates of deposit, lines of credit, borrowings that are secured by bank premises or stock of United’s subsidiaries and issuances of trust preferred securities. In the normal course of business, United through its Asset Liability Committee evaluates these as well as other alternative funding strategies that may be utilized to meet short-term and long-term funding needs.

During the first half of 2026, United decreased its interest-bearing deposit balance at the FRB by $517.17 million to $1.72 billion. The change in the balance at the FRB was mostly the result of growth in loans of $286.87 million, net purchases of $267.87 million in investment securities and a net repayment of $31.58 million in securities sold under agreements to repurchase partially offset by a growth in total deposits of $109.82 million.

For the six months ended June 30, 2026, cash of $266.02 million was provided by operating activities due mainly to net income of $255.58 million. Net cash of $564.99 million was used in investing activities which was primarily due to the aforementioned loan growth of $286.87 million and net purchases of investment securities of $267.87 million. During the first six months of 2026, net cash of $161.97 million was used in financing activities due primarily to net acquisition of $136.25 million in treasury stock, cash dividends paid of $106.69 million and the net repayment of securities sold under agreements to repurchase of $31.58 million partially offset by growth in deposits of $109.82 million. The net effect of the cash flow activities was a decrease in cash and cash equivalents of $460.95 million for the first half of 2026.

At June 30, 2026, United had an unused borrowing amount at the FHLB of approximately $9.25 billion subject to delivery of collateral after certain trigger points and $5.03 billion without the delivery of additional collateral. United has various unused lines of credit available from certain of its correspondent banks in the aggregate amount of $280 million and a $20 million unsecured, revolving line of credit with an unrelated financial institution to provide for general liquidity needs, all of which was available at June 30, 2026. At June 30, 2026, United’s borrowing capacity for the FRB Discount Window was $4.42 billion. United did not have any borrowings from the FRB’s Discount Window during the first half of 2026.

United anticipates it can meet its obligations over the next 12 months and has no material commitments for capital expenditures. United also has lines of credit available. See Notes 8 and 9 to the accompanying unaudited Notes to Consolidated Financial Statements for more details regarding the amounts available to United under lines of credit.

The Asset Liability Committee monitors liquidity to ascertain that a liquidity position within certain prescribed parameters is maintained. No changes are anticipated in the policies of United’s Asset Liability Committee.

United’s capital position is financially sound. United seeks to maintain a proper relationship between capital and total assets to support growth and sustain earnings. United has historically generated attractive returns on shareholders’ equity. United is well-capitalized based upon regulatory guidelines. United’s risk-based capital ratio is 15.57% at June 30, 2026 while its Common Equity Tier 1 capital, Tier 1 capital and leverage ratios are 13.30%, 13.30% and 11.29%, respectively. The regulatory requirements for a well-capitalized financial institution are a risk-based capital ratio of 10.0%, a Common Equity Tier 1 capital ratio of 6.5%, a Tier 1 capital ratio of 8.0% and a leverage ratio of 5.0%.

Total shareholders’ equity was $5.51 billion at June 30, 2026, which was relatively flat from December 31, 2025, increasing $14.55 million or less than 1%. This slight increase was primarily due to an increase of $149.80 million in retained earnings as a result of net earnings (net income less dividends declared) during the first half of 2026 partially offset by an increase of $137.64 million in treasury stock. During the first half of 2026, United repurchased 3,241,721 shares of its common stock at an average price of $41.78 per share.

United’s shareholders’ equity to assets ratio was 16.33% at June 30, 2026 as compared to 16.33% at December 31, 2025. The primary capital ratio, capital and reserves to total assets and reserves, was 17.15% at both June 30, 2026 and December 31, 2025. United’s average equity to average asset ratio was 16.38% for the second quarter of 2026 as compared to 16.42% the second quarter of 2025. United’s average equity to average asset ratio was 16.42% for both the first half of 2026 and the first half of 2025. All of these financial measurements reflect a financially sound position.

During the second quarter of 2026, United’s Board of Directors declared a cash dividend of $0.38 per share. Cash dividends were $0.76 per common share for the first six months of 2026. Total cash dividends declared were $52.61 million for the second quarter of 2026 and $105.78 million for the first six months of 2026 as compared to $52.75 million for the second quarter of 2025 and $106.08 million for the first six months of 2025, respectively.