HANCOCK WHITNEY CORP

Previous wording

The objective of this discussion and analysis is to provide material information relevant to the assessment of the financial condition and results of operations of Hancock Whitney Corporation and its subsidiaries during the three and six months ended June 30, 2026 and selected comparable prior periods, including an evaluation of the amounts and certainty of cash flows from operations and outside sources. This discussion and analysis is intended to highlight and supplement financial and operating data and information presented elsewhere in this report, including the consolidated financial statements and related notes. The discussion contains forward-looking statements within the meaning and protections of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are subject to risks and uncertainties. Should one or more of these risks or uncertainties materialize, our actual results may differ from those expressed or implied by the forward-looking statements. Important factors that could cause actual results to differ materially from the forward-looking statements we make in this Quarterly Report on Form 10-Q and in other reports or documents that we file from time to time with the SEC include, but are not limited to, the following:

Current wording

The objective of this discussion and analysis is to provide material information relevant to the assessment of the financial condition and results of operations of Hancock Whitney Corporation and its subsidiaries during the three and nine months ended September 30, 2026 and selected comparable prior periods, including an evaluation of the amounts and certainty of cash flows from operations and outside sources. This discussion and analysis is intended to highlight and supplement financial and operating data and information presented elsewhere in this report, including the consolidated financial statements and related notes. The discussion contains forward-looking statements within the meaning and protections of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are subject to risks and uncertainties. Should one or more of these risks or uncertainties materialize, our actual results may differ from those expressed or implied by the forward-looking statements. Important factors that could cause actual results to differ materially from the forward-looking statements we make in this Quarterly Report on Form 10-Q and in other reports or documents that we file from time to time with the SEC include, but are not limited to, the following:

Previous wording

general economic and business conditions in our local markets, including conditions affecting employment levels, interest rates, inflation, the threat of recession, volatile equity capital markets, property and casualty insurance costs, collateral values, customer income, creditworthiness and confidence, spending and savings that may affect customer bankruptcies, defaults, charge-offs and deposit activity; and the impact of the foregoing on customer behavior (including the velocity and levels of deposit withdrawals and loan repayment);

Current wording

general economic and business conditions in our local markets, including conditions affecting employment levels, interest rates, inflation, the threat of recession, tariffs, volatile equity capital markets, property and casualty insurance costs, collateral values, customer income, creditworthiness and confidence, spending and savings that may affect customer bankruptcies, defaults, charge-offs and deposit activity, and the impact of the foregoing on customer behavior (including the velocity and levels of deposit withdrawals and loan repayment);

Previous wording

the timing, benefits, costs and synergies of the merger with OFB Bancshares, Inc., as well as statements regarding potential impact of current or future business combinations on our performance and financial condition, including our ability to successfully identify acquisition targets and to successfully integrate the businesses;

Current wording

the timing (including integration), impact on customers, employees and deposit mix, benefits, costs and synergies of the merger with OFB Bancshares, Inc., as well as statements regarding potential impact of current or future business combinations on our performance and financial condition, including our ability to successfully identify acquisition targets and to successfully integrate the businesses;

Previous wording

our ability to identify and address potential cybersecurity risks and/or breaches, which may be exacerbated by recent developments in generative artificial intelligence, on our systems and/or third party vendors and service providers on which we rely, a material failure of which could disrupt our business and result in the disclosure of and/or misuse or misappropriation of confidential or proprietary information, disruption or damage to our systems, increased costs, losses, or adverse effects to our reputation;

Current wording

our ability to identify and address potential cybersecurity risks and/or breaches, which may be exacerbated by developments in generative artificial intelligence, on our systems and/or third party vendors and service providers on which we rely, a material failure of which could disrupt our business and result in the disclosure of and/or misuse or misappropriation of confidential or proprietary information, disruption or damage to our systems, increased costs, losses, or adverse effects to our reputation;

Previous wording

changes in laws and regulations affecting our businesses, including governmental monetary and fiscal policies, legislation and regulations relating to bank products and services, as well as changes in the enforcement and interpretation of such laws and regulations by applicable governmental and self-regulatory agencies, which could require us to change certain business practices, increase compliance risk, reduce our revenue, impose additional costs on us, or otherwise negatively affect our businesses;

Current wording

changes in laws and regulations affecting our businesses, including governmental monetary and fiscal policies, legislation and regulations relating to bank products and services, as well as changes in the enforcement and interpretation of such laws and regulations by applicable governmental and self-regulatory agencies, which could require us to change certain business practices, increase compliance risk, reduce our revenue, impose additional costs on us, or otherwise negatively affect our businesses; and

Previous wording

Subsequent to the end of the second quarter of 2026, on August 1, 2026, we acquired OFB Bancshares, Inc., parent company of One Florida Bank, in an all-cash transaction. One Florida Bank operated five financial centers in the greater Orlando, Florida area and one in the Florida Panhandle. At June 30, 2026, OFB Bancshares, Inc., on a consolidated basis, had total assets of $2.1 billion, total loans of $1.7 billion, and total deposits of $1.8 billion. The acquisition enhances our existing financial center footprint by establishing a meaningful presence in the high growth Orlando market and is expected to be immediately accretive to earnings per share, exclusive of one-time transaction costs. Full integration and system conversion activities are expected to be finalized in the fourth quarter of 2026.

Current wording

One Florida Bank operated five financial centers in the greater Orlando, Florida area and one in the Florida Panhandle. The acquisition enhances our existing financial center footprint by establishing a meaningful presence in the high growth Orlando market and is expected to be immediately accretive to earnings per share, exclusive of one-time transaction costs of approximately $30.4 million incurred in the third quarter of 2026. Full integration and system conversion activities are expected to be finalized in the fourth quarter of 2026. Refer to Note 2 - Acquisition in Part I, Item I of this document for additional information.

Previous wording

In the second quarter of 2026, conditions in the financial services industry remained generally favorable despite persistent economic pressures and uncertainty with respect to fiscal and monetary policy. Within our markets, we experienced robust loan production, and deposit cost pressures continued to moderate, contributing favorably to our net interest margin and profitability.

Current wording

In the third quarter of 2026, conditions in the financial services industry remained generally favorable despite persistent economic pressures and uncertainty with respect to fiscal and monetary policy. We experienced solid loan production and deposit growth beyond those from the OFB acquisition, reflecting what we believe to be a general resilience in our local markets.

Previous wording

The baseline scenario maintains a mostly optimistic tenor with respect to economic outcomes, though the outlook has softened as energy prices remain elevated. Key variables underlying the June 2026 baseline forecast include the following: (1) the conflict with Iran will be resolved in the near-term; (2) the effective tariff rate of about 8% is expected to remain for the duration of the current administration before eventually falling back to about 2% late in the decade or early in the next; (3) above target inflation caused by the Iran conflict, oil price shock, tariffs and migration policy headwinds will preclude Federal Reserve interest rate cuts for the remainder of 2026 and 2027; (4) the combination of a slowdown in labor force growth and monthly job growth will remain a headwind to the labor market, prompting the unemployment rate to resume a gradual climb, peaking at 4.6% in the second quarter of 2027; (5) GDP is forecasted at 2.1% in 2026 and then slow to 1.9% in 2027 and 2.0% in 2028 before rebounding to 2.5% in 2029; (6) the 10-year U.S. Treasury yield is forecasted to average 4.4% in the second quarter of 2026 and remain near that level through the end of the decade due to elevated inflation and fiscal uncertainty.

Current wording

The baseline scenario maintains a mostly optimistic tenor with respect to economic outcomes, though the outlook has weakened somewhat from previously published scenarios. Key variables underlying the September 2026 baseline forecast include the following: (1) the likelihood of a near-term negotiated settlement between the US and Iran has decreased, and, as a result, crude oil prices will remain elevated for longer; (2) the Fed funds target rate will stay within the range of 3.5% to 3.75% until the end of the decade, reflecting short-term inflation pressures from the Iran war; (3) the effective tariff rate of about 8% is expected to remain for the duration of the current administration before eventually falling back to about 2% late in the decade or early in the next; (4) the combination of a slowdown in labor force growth and monthly job growth will remain a headwind to the labor market, prompting the unemployment rate to resume a gradual climb, peaking at 4.7% in the second half of 2027; (5) GDP is forecasted at 2.2% in 2026, slowing slightly to 2.0% in 2027 and 2.1% in 2028 before rebounding to 2.5% in 2029; (6) the 10-year U.S. Treasury yield is forecasted to average 4.6% in the third quarter of 2026 and remain near that level through the end of the decade due to elevated inflation and fiscal uncertainty.

Previous wording

The S-2 scenario presents a downside alternative to the baseline. The S-2 scenario assumes the negotiations between the U.S. and Iran take longer than expected and that the damage to energy infrastructure is worse than expected and takes longer to repair. As a result, oil prices decline at a slower rate than assumed in the baseline. The effective tariff rate increases to about 11% and remains elevated through the end of 2028. The impacts on the economy from tariffs, deportations and elevated oil prices are worse than expected, causing inflation to rise. Further, there is longer and farther-reaching disturbance from other geopolitical conflict. The scenario assumes the unemployment rate will rise considerably to a peak of 7.3% in the second quarter of 2027 and remain elevated before returning to full employment in late 2028. The combination of higher oil prices, rising inflation, tariffs, still elevated interest rates and reduced credit availability causes the U.S. economy to fall into a mild recession beginning in the third quarter of 2026 that lasts for three quarters, with a peak-to-trough decline in GDP of 1% and the stock market contracting 22%. The recession and rising inflation prompts the Federal Reserve to lower its benchmark interest rate only slightly below what is forecasted in the baseline scenario before making more significant cuts as inflation subsides.

Current wording

The S-2 scenario presents a downside alternative to the baseline. The S-2 scenario assumes the effective tariff rate increases to about 11% and remains elevated through the end of 2028. The impacts on the economy from tariffs, deportations and still-elevated oil prices as a result of the conflict with Iran are worse than expected, causing inflation to rise. Further, there is longer and farther-reaching disturbance from other geopolitical conflict. The scenario assumes the unemployment rate will rise considerably to a peak of 7.2% in the third quarter of 2027 and remain elevated before returning to full employment in early 2029. The combination of higher oil prices, rising inflation, tariffs, still elevated interest rates and reduced credit availability causes the U.S. economy to fall into a mild recession beginning in the fourth quarter of 2026 that lasts for three quarters, with a peak-to-trough decline in GDP of 1.1% and the stock market contracting 22%. The recession and rising inflation prompts the Federal Reserve to lower its benchmark interest rate slightly below what is forecasted in the baseline scenario before making more significant cuts as inflation subsides.

Previous wording

Management has deemed certain assumptions underlying the baseline scenario and the downside S-2 scenario to have an equal likelihood to occur in the near term, and, as such, the baseline and S-2 scenarios were each given probability weightings of 50% in the calculation of our allowance for credit losses at June 30, 2026. The weighting of scenarios has changed from the March 31, 2026 calculation of allowance for credit losses, where the baseline scenario was weighted at 40% and the downside S-2 scenario was weighted at 60%. The change in weighting does not represent a significant shift in our outlook, but rather is a function of a shift in the assumptions underlying the baseline forecast to reflect the downside risks of the U.S. – Iran conflict.

Current wording

Management has deemed certain assumptions underlying the baseline scenario and the downside S-2 scenario to have an equal likelihood to occur in the near term, and, as such, the baseline and S-2 scenarios were each given probability weightings of 50% in the calculation of our allowance for credit losses at September 30, 2026, consistent with the weightings used in the calculation of allowance for credit losses at June 30, 2026.

Previous wording

Rapidly evolving changes in geopolitical, fiscal and other policies have created heightened uncertainty as to the impact on the U.S. and global economies. The duration and scope of the conflict in the Middle East is expected to play a pivotal role in economic conditions. The impact of continued inflation, a softening labor market and the Federal Reserve's actions to counter those effects, as well as to respond to other economic concerns, could reduce economic growth in the near term. The full extent of the impact of the conflict in the Middle East and other influential factors are uncertain and may have an adverse effect on the U.S. economy, including the possibility of an economic recession or slower growth in the near or midterm.

Current wording

Rapidly evolving changes in geopolitical, fiscal and other policies continue to drive heightened uncertainty as to the impact on the U.S. and global economies. The duration and scope of the conflict in the Middle East continues to play a pivotal role in economic conditions. The impact of persisting inflation, the potential for a softening labor market and the Federal Reserve's actions to counter those effects, as well as to respond to other economic concerns, could reduce economic growth in the near term. The full extent of the impact of the conflict in the Middle East and other influential factors are uncertain and may have an adverse effect on the U.S. economy, including the possibility of an economic recession or slower growth in the near or midterm.

Previous wording

We reported net income for the second quarter of 2026 of $127.0 million, or $1.55 per diluted common share, compared to $47.4 million, or $0.57 per diluted common share, in the first quarter of 2026 and $113.5 million, or $1.32 per diluted common share, in the second quarter of 2025. The first quarter of 2026 included a supplemental disclosure item attributable to a net loss on the restructuring of the available for sale securities portfolio totaling $98.6 million pre-tax, or $0.95 per diluted share after tax, and the second quarter of 2025 included supplemental disclosure items $5.9 million pre-tax, or $0.05 per diluted share, attributable to costs associated with the acquisition of Sabal Trust Company.

Current wording

We reported net income for the third quarter of 2026 of $110.1 million, or $1.36 per diluted common share, compared to $127.0 million, or $1.55 per diluted common share, in the second quarter of 2026 and $127.5 million, or $1.49 per diluted common share, in the third quarter of 2025. The third quarter of 2026 includes supplemental disclosure items attributable to the acquisition of OFB Bancshares, Inc. (OFB) totaling $30.4 million pre-tax, or $0.30 per diluted share after tax. There were no supplemental disclosure items in the second quarter of 2026 or the third quarter of 2025.

Previous wording

Second quarter 2026 results compared to first quarter 2026:

Current wording

Third quarter 2026 results compared to second quarter 2026:

Previous wording

Adjusted pre-provision net revenue, a non-GAAP measure, totaled $178.1 million, up $5.2 million, or 3%

Current wording

Adjusted pre-provision net revenue, a non-GAAP measure, totaled $189.3 million, up $11.1 million, or 6%

Previous wording

Criticized commercial loans decreased while total nonaccrual loans remained relatively flat; annualized net charge-offs to average loans was 0.16%, down from 0.19%

Current wording

Criticized commercial loans decreased while total nonaccrual loans increased; annualized net charge-offs to average loans was unchanged at 0.16%

Previous wording

Allowance for credit losses coverage to total loans remains solid at 1.42%, down 1 basis point (bp) from March 31, 2026

Current wording

Allowance for credit losses coverage to total loans remained solid at 1.42%, unchanged from June 30, 2026

Previous wording

Tangible common equity ratio of 9.78%, down 15 bps; common equity tier 1 ratio of 13.19%, down 10 bps; and total risk-based capital ratio of 14.98%, down 12 bps; all reflective of capital deployment to enhance shareholder value

Current wording

Tangible common equity ratio of 8.05%, down 173 bps; common equity tier 1 ratio of 11.57%, down 162 bps; and total risk-based capital ratio of 13.26%, down 172 bps

Previous wording

Efficiency ratio, a non-GAAP measure, improved to 55.31%, compared to 55.43%

Current wording

Efficiency ratio, a non-GAAP measure, improved to 54.46%, compared to 55.31%

Previous wording

Our results for the second quarter of 2026 reflect continued strong performance, profitability and enhanced shareholder value. We experienced solid loan and deposit growth during the quarter, reflecting continued progress on our organic growth plan. We continued to invest in our growth strategy with the hiring of a net 15 new bankers in the second quarter, bringing the year to date total to 42. We also returned capital to shareholders with the repurchase of 712,966 shares of our common stock, bringing year-to-date repurchases to 2.1 million shares. Noninterest income grew, expenses remained on target and our efficiency ratio improved. Credit metrics remained stable and we maintained a robust allowance for credit losses coverage of 1.42%. Looking ahead, our acquisition of One Florida Bank, completed on August 1, 2026, will enhance our ability to bring our relationship-based approach to banking to customers across an expanded footprint in the Central Florida area. We remain encouraged by the momentum across our franchise. While the operating environment continues to present challenges, we believe our solid balance sheet, strong customer relationships and disciplined execution position us well to deliver on our objectives for the remainder of this year and over the longer term.

Current wording

Our results for the third quarter of 2026 again reflect a period of strong performance and enhanced shareholder value. Our acquisition of OFB, completed on August 1, 2026, delivered approximately $2 billion of balance sheet growth and enhanced our ability to bring our relationship-based approach to banking to customers across an expanded footprint in the Central Florida area. We experienced solid organic deposit and loan growth during the third quarter, reflecting continued progress on our multi-year growth plan. Adjusted pre-provision net revenue grew and our efficiency ratio improved. Credit metrics remained stable and we maintained a robust allowance for credit losses coverage of 1.42%. We also returned capital to shareholders with the repurchase of 1.0 million shares of our common stock, bringing year-to-date repurchases to 3.1 million shares. Our capital ratios remain strong and reflect capital deployed for both inorganic and organic growth, return to shareholders and the impact of the rising interest rate environment. We believe our solid balance sheet, strong customer relationships and disciplined execution position us well to deliver on our objectives for the remainder of this year and over the longer term.

Previous wording

The $7.7 million increase in net interest income (te) from the first quarter of 2026 is comprised of an increase in interest income (te) of $11.3 million partially offset by an increase in interest expense of $3.6 million. The increase in interest income (te) was driven primarily by loan growth, an additional accrual day and an increase in interest income from securities as a result of the full-quarter impact of the portfolio restructuring completed in late January 2026. The increase in interest expense was primarily attributable to an increase in average short-term borrowings to support growth in the loan portfolio and an additional accrual day, partially offset by a decrease in the cost of deposits, reflecting a continued shift in the mix of average interest-bearing deposits from time deposits to transaction and savings deposits. The net interest margin for the second quarter of 2026 was 3.56%, up 1 bp from the first quarter of

Current wording

The $19.7 million increase in net interest income (te) from the second quarter of 2026 is comprised of an increase in interest income (te) of $33.5 million that was partially offset by an increase in interest expense of $13.8 million. The acquisition of OFB contributed approximately $22.8 million of interest income, inclusive of $3.3 million of accretion of the fair value discount, and $7.9 million of interest expense. Outside of the contributions from the OFB acquisition, the increase in interest income (te) was driven primarily by increases in yields on securities and loans, organic loan growth and the impact of an additional accrual day. The increase in interest expense from our legacy operation was driven primarily by increases in the average balance and cost of interest-bearing deposits and the impact of an additional accrual day, partially offset by a decrease in average short-term borrowings. The net interest margin for the third quarter of 2026 was 3.61%, up 5 bps from the second quarter of 2026, due in part to the acquisition of OFB, including accretion. The increase in net interest margin also reflects higher yields on securities and loans and lower average short-term borrowings, partially offset by growth in and the rate paid on interest-bearing deposits.

Previous wording

The $30.6 million increase in net interest income (te) for the six months ended June 30, 2026 from the same period in 2025 is comprised of a $15.7 million increase in interest income (te) and a $14.9 million decrease in interest expense. The increase in interest income (te) was primarily attributable to an increase in interest income from securities, as the impact of loan growth was largely offset by a decline in loan yields. The decrease in interest expense was driven by a decline in interest expense on deposits that was largely a product of the interest rate environment, which also fostered a favorable shift in the mix of average interest-bearing deposits from time deposits to transaction and savings deposits, partially offset by an increase in average short-term borrowings. The net interest margin for the six months ended June 30, 2026 was 3.55%, up 9 bps from the same period in 2025, largely attributable to the impact of higher securities yields of 47 bps, a lower cost of interest-bearing deposits of 37 bps, partially offset by a decline in loan yields of 24 bps and an increase in borrowing costs of 40 bps.

Current wording

The $63.2 million increase in net interest income (te) for the nine months ended September 30, 2026 from the same period in 2025 is comprised of a $52.7 million increase in interest income (te) and a $10.5 million decrease in interest expense. The acquisition of OFB contributed approximately $22.8 million of interest income, inclusive of accretion, and $7.9 million of interest expense. Outside of the contributions from the OFB acquisition, the increase in interest income (te) was primarily attributable to higher yield on the securities portfolio and loan growth that was partially offset by a decline in yields on loans and short-term investments. The decrease in interest expense was driven by a decline in the cost of interest-bearing deposits, reflective of interest rate movement and a favorable shift in the mix within interest-bearing deposits, partially offset by increases in the average balance of interest-bearing deposits and short-term borrowings. The net interest margin for the nine months ended September 30, 2026 was 3.57%, up 10 bps from the same period in 2025, driven in part by the acquisition of OFB, including accretion, and also by a decrease in the rate paid on interest-bearing deposits, an increase in the yield on securities, and loan growth, partially offset by a decline in the loan yield, growth in interest-bearing deposits, and an increase in average short-term borrowings. The improvement in the securities yield is due in part to the portfolio restructure in the first quarter of 2026.

Previous wording

During the second quarter of 2026, we recorded a provision for credit losses of $13.8 million, compared to $13.2 million in the first quarter of 2026. The provision for credit losses in the second quarter of 2026 included net charge-offs of $9.4 million and a reserve build of $4.4 million, compared to net charge-offs of $11.1 million and a reserve build of $2.1 million in the first quarter of 2026. The provisions for credit losses in both periods reflect mostly stable credit quality and modest builds attributable to loan growth.

Current wording

During the third quarter of 2026, we recorded a provision for credit losses of $16.1 million, compared to $13.8 million in the second quarter of 2026. The provision for credit losses in the third quarter of 2026 included net charge-offs of $10.2 million and a reserve build of $5.9 million, including $1.0 million attributable to a provision for unfunded commitments assumed in the acquisition of OFB, identified as a supplemental disclosure item. The provision for credit losses in the second quarter of 2026 included net charge-offs of $9.4 million and a reserve build of $4.4 million. The provision for credit losses in both periods reflect mostly stable credit quality and modest builds attributable to loan growth.

Previous wording

Annualized net charge-offs as a percentage of average loans in the second quarter of 2026 were 0.16%, down from 0.19%, in the first quarter of 2026. Net charge-offs in the second quarter of 2026 included $6.6 million in the commercial portfolio, $2.7 million in the consumer portfolio and $0.1 million in the residential mortgage portfolio. Net charge-offs in the first quarter of 2026 included $7.4 million in the commercial portfolio, $3.5 million in the consumer portfolio and $0.2 million in the residential mortgage portfolio.

Current wording

Annualized net charge-offs as a percentage of average loans in the third quarter of 2026 were 0.16%, unchanged from the second quarter of 2026. Net charge-offs in the third quarter of 2026 included $7.3 million in the commercial portfolio, $2.5 million in the consumer portfolio and $0.4 million in the residential mortgage portfolio. Net charge-offs in the second quarter of 2026 included $6.6 million in the commercial portfolio, $2.7 million in the consumer portfolio and $0.1 million in the residential mortgage portfolio.

Previous wording

For the six months ended June 30, 2026, we recorded a provision for credit losses of $26.9 million compared to $25.4 million for the same period in 2025. The provision for credit losses for the six months ended June 30, 2026 included net charge-offs of $20.6 million and a reserve build of $6.3 million, compared to net charge-offs of $28.0 million and a reserve release of $2.6 million in the same period in 2025. Net charge-offs for the six months ended June 30, 2026 were 0.17% of average loans, comprised of net charge-offs of $14.1 million in the commercial portfolio, $6.2 million in the consumer portfolio and $0.3 million in the residential mortgage portfolio. Net charge-offs for the six months ended June 30, 2025 were 0.24% of average loans, comprised of net charge-offs of $21.8 million in the commercial portfolio and $6.3 million in the consumer portfolio, partially offset by net recoveries of less than $0.1 million in the residential mortgage portfolio.

Current wording

For the nine months ended September 30, 2026, we recorded a provision for credit losses of $43.0 million compared to $38.0 million for the same period in 2025. The provision for credit losses for the nine months ended September 30, 2026 included net charge-offs of $30.8 million and a reserve build of $12.2 million, including the $1.0 million supplemental disclosure item described above. The provision for credit losses for the nine months ended September 30, 2025 included net charge-offs of $39.4 million and a reserve release of $1.4 million. Net charge-offs for the nine months ended September 30, 2026 were 0.17% of average loans, comprised of net charge-offs of $21.4 million in the commercial portfolio, $8.7 million in the consumer portfolio and $0.7 million in the residential mortgage portfolio. Net charge-offs for the nine months ended September 30, 2025 were 0.23% of average loans, comprised of net charge-offs of $29.2 million in the commercial portfolio, $10.1 million in the consumer portfolio, and $0.1 million in the residential mortgage portfolio.

Previous wording

Noninterest income totaled $108.4 million for the second quarter of 2026, up $100.9 million from the first quarter of 2026. Included in noninterest income in the first quarter of 2026 was a $98.6 million loss identified as a supplemental disclosure item attributable to the restructuring of the available for sales securities portfolio. Excluding the supplemental disclosure item, noninterest income was up $2.3 million, or 2%, from the first quarter of 2026, driven primarily by increases in investment and annuity fees, trust fees, bank card and ATM fees and income from secondary mortgage market operations, partially offset by a decline in other miscellaneous income. For the six months ended June 30, 2026, noninterest income totaled $115.8 million, down $77.5 million from the same period in 2025. Excluding the supplemental disclosure item described above, noninterest income was up $21.1 million, or 11%, from the same period in 2025, with increases across most lines. A detailed discussion of noninterest income variances follows.

Current wording

Noninterest income totaled $107.0 million for the third quarter of 2026, down $1.3 million, or 1%, from the second quarter of 2026, driven primarily by declines in secondary mortgage market operations, trust fees and investment and annuity fees, partially offset by increases in service charges on deposits and other miscellaneous income. For the nine months ended September 30, 2026, noninterest income totaled $222.8 million, down $76.5 million from the same period in 2025. Included in noninterest income for the nine months ended September 30, 2026 was a $98.6 million loss identified as a supplemental disclosure item attributable to the restructuring of the available for sales securities portfolio. Excluding the supplemental disclosure item, noninterest income was up $22.1 million, or 7%, from the same period in 2025, with increases across most lines. A detailed discussion of noninterest income variances follows.

Previous wording

Service charges on deposit accounts include consumer, business, and corporate deposit account servicing fees, as well as nonsufficient funds fees on non-consumer accounts, overdraft and overdraft protection fees, and other customer transaction-related fees. Service charges on deposits totaled $25.9 million for the second quarter of 2026, virtually flat compared to the first quarter of 2026. For the six months ended June 30, 2026, service charges on deposits totaled $51.8 million, up $3.4 million, or 7%, from the same period in 2025, primarily attributable to consumer overdraft fees and analysis fees on commercial accounts.

Current wording

Service charges on deposit accounts include consumer, business, and corporate deposit account servicing fees, as well as nonsufficient funds fees on non-consumer accounts, overdraft and overdraft protection fees, and other customer transaction-related fees. Service charges on deposits totaled $27.1 million for the third quarter of 2026, up $1.2 million, or 5%, from the second quarter of 2026. For the nine months ended September 30, 2026, service charges on deposits totaled $78.9 million, up $5.3 million, or 7%, from the same period in 2025. The increases in service charges on deposits for both the three and nine months ended September 30, 2026 include a $0.2 million contribution from deposits assumed in the OFB acquisition. Outside of the contribution from OFB, both the linked-quarter and year-over-year increases in service charges on deposit accounts were driven largely by increases in commercial analysis fees and consumer, small business and commercial overdraft fees.

Previous wording

Trust fee income represents revenue generated from a full range of trust services, including asset management and custody services provided to individuals, businesses and institutions. Trust fees totaled $26.0 million for the second quarter of 2026, up $1.5 million, or 6%, from the first quarter of 2026, driven in part by seasonal tax preparation fees. For the six months ended June 30, 2026, trust fees totaled $50.6 million, up $9.8 million, or 24%, from the same period in 2025. The year-over-year increase is mostly attributable to personal trust, resulting from both a full period contribution from the Sabal acquisition and organic and market value-driven growth in our legacy business.

Current wording

Trust fee income represents revenue generated from a full range of trust services, including asset management and custody services provided to individuals, businesses and institutions. Trust fees totaled $25.0 million for the third quarter of 2026, down $1.1 million, or 4%, from the second quarter of 2026, driven in part by seasonal tax preparation fees earned in the second quarter of 2026. For the nine months ended September 30, 2026, trust fees totaled $75.6 million, up $10.6 million, or 16%, from the same period in 2025. The year-over-year increase is mostly attributable to personal trust, resulting from both a full period contribution from the Sabal acquisition and organic and market value-driven growth in our legacy business.

Previous wording

Bank card and ATM fees include interchange and other income from credit and debit card transactions, fees earned from processing card transactions for merchants, and fees earned from ATM transactions. Bank card and ATM fees totaled $23.2 million for the second quarter of 2026, up $1.1 million, or 5%, from the first quarter of 2026, reflecting higher activity across all fee lines. Bank card and ATM fees for the six months ended June 30, 2026 totaled $45.3 million, up $2.6 million, or 6%, from the same period in 2025. The year-over-year increase is mostly attributable to interchange fees, due in part to card-focused marketing campaigns, and ATM fees, reflecting a marketing adjustment on certain fees.

Current wording

Bank card and ATM fees include interchange and other income from credit and debit card transactions, fees earned from processing card transactions for merchants, and fees earned from ATM transactions. Bank card and ATM fees totaled $23.0 million for the third quarter of 2026, down $0.2 million, or 1%, from the second quarter of 2026, driven primarily by a decline in merchant services fees. Bank card and ATM fees for the nine months ended September 30, 2026 totaled $68.3 million, up $3.8 million, or 6%, from the same period in 2025. The year-over-year increase is mostly attributable to interchange fees, due in part to card-focused marketing campaigns, and ATM fees, reflecting a marketing adjustment on certain fees.

Previous wording

Investment and annuity fees and insurance commissions includes both fees earned from sales of annuity and insurance products, as well as managed account fees. Investment and annuity fees and insurance commissions totaled $14.6 million for the second quarter of 2026, up $2.0 million, or 16%, from the first quarter of 2026. The linked quarter increase was largely driven by annuity sales, corporate underwriting fees and investment management fees. For the six months ended June 30, 2026, investment and annuity fees and insurance commissions totaled $27.2 million, up $5.2 million, or 23%, from the same period in 2025. The year-over-year increase was largely driven by fixed income trading and investment management fees, partially offset by a decline in annuity sales. Investment and annuity fee income can vary from period to period depending on market conditions, impacting demand for products and services and related fees.

Current wording

Investment and annuity fees and insurance commissions includes both fees earned from sales of annuity and insurance products, as well as managed account fees. Investment and annuity fees and insurance commissions totaled $13.9 million for the third quarter of 2026, down $0.7 million, or 5%, from the second quarter of 2026. The linked quarter decrease was largely driven by annuity sales volume. For the nine months ended September 30, 2026, investment and annuity fees and insurance commissions totaled $41.1 million, up $4.5 million, or 12%, from the same period in 2025. The year-over-year increase was largely driven by fixed income trading and investment management fees, partially offset by a decline in annuity sales. Investment and annuity fee income can vary from period to period depending on market conditions, impacting demand for products and services and related fees.

Previous wording

Income from secondary mortgage market operations is comprised of income produced from the origination and sales of residential mortgage loans in the secondary market. We offer a full range of mortgage products to our customers and typically sell longer-term fixed-rate loans while retaining the majority of adjustable-rate loans, as well as loans generated through programs to support customer relationships. Secondary mortgage market operations income will vary based on mortgage application volume, pull through rates, the percentage of loans ultimately sold in the secondary market and the timing of such sales. Income from secondary mortgage market operations was $4.1 million in the second quarter of 2026, up $0.5 million, or 15%, from the first quarter of 2026. The linked quarter increase was primarily attributable to an increase in mortgage production. For the six months ended June 30, 2026, income from secondary mortgage market operations totaled $7.6 million, virtually flat compared to the same period in 2025, as the impact of an increase in mortgage production was offset by a decline in the percentage of loans sold in the secondary market.

Current wording

Income from secondary mortgage market operations is comprised of income produced from the origination and sales of residential mortgage loans in the secondary market. We offer a full range of mortgage products to our customers and typically sell longer-term fixed-rate loans while retaining the majority of adjustable-rate loans, as well as loans generated through programs to support customer relationships. Secondary mortgage market operations income will vary based on mortgage application volume, pull through rates, the percentage of loans ultimately sold in the secondary market and the timing of such sales. Income from secondary mortgage market operations was $2.9 million in the third quarter of 2026, down $1.2 million, or 30%, from the second quarter of 2026. The linked quarter decrease was primarily attributable to a decrease in both production and the percentage of loans sold in the secondary market, largely reflective of pressure from interest rate movement. For the nine months ended September 30, 2026, income from secondary mortgage market operations totaled $10.5 million, down $0.6 million, or 6%, from the same period in 2025, as the impact of an increase in mortgage production was offset by a decline in the percentage of loans sold in the secondary market.

Previous wording

There was no net gain or loss on securities transactions during the second quarter of 2026, compared to a net loss on securities transactions of $98.6 million in the first quarter of 2026 that resulted from the sale of $1.5 billion of available for sale securities. The sale reflects a strategic decision to restructure the portfolio to enhance future net interest income through deployment of the proceeds into higher-yielding instruments.

Current wording

There was no net gain or loss on securities transactions during the third or second quarters of 2026 or in any period in 2025. For the nine months ended September 30, 2026, net loss on securities transactions totaled $98.6 million, resulting from the sale of $1.5 billion of available for sale securities. The sale reflects a strategic decision to restructure the portfolio to enhance future net interest income through deployment of the proceeds into higher-yielding instruments.

Previous wording

Income from bank-owned life insurance (BOLI) is typically generated through insurance benefit proceeds as well as the growth of the cash surrender value of insurance contracts held. Income from BOLI was $6.3 million for the second quarter of 2026, up $1.0 million, or 20%, from the first quarter of 2026. The linked quarter increase was driven primarily by an increase in mortality gains and also reflects an increase in income from changes in cash surrender value. For the six months ended June 30, 2026, income from BOLI totaled $11.6 million, up $1.4 million, or 14%, from the same period in 2025, driven by an increase in income from changes in cash surrender value that was partially offset by a decline in mortality gains.

Current wording

Income from bank-owned life insurance (BOLI) is typically generated through insurance benefit proceeds as well as the growth of the cash surrender value of insurance contracts held. Income from BOLI was $5.9 million for the third quarter of 2026, down $0.4 million, or 7%, from the second quarter of 2026. The linked quarter decrease was driven by a decline in mortality gains that was partially offset by an increase in income from changes in cash surrender value. For the nine months ended September 30, 2026, income from BOLI totaled $17.5 million, up $1.5 million, or 10%, from the same period in 2025, driven by an increase in income from changes in cash surrender value that was partially offset by a decline in mortality gains.

Previous wording

Credit related fees include fees assessed on letters of credit and unused portions of loan commitments. For the three and six months ended June 30, 2026, credit related fees totaled $2.8 million and $5.6 million, respectively. The linked quarter and year-over-year variances were virtually flat in relation to the respective comparative periods.

Current wording

Credit related fees include fees assessed on letters of credit and unused portions of loan commitments. For the three months ended September 30, 2026, credit related fees totaled $2.9 million, up $0.1 million, or 3%, from the second quarter of 2026. For the nine months ended September 30, 2026, credit related fees totaled $8.4 million, virtually flat compared to the same period in 2025. Credit related fees can vary from period to period depending on the amount of letters of credit outstanding and utilization rates of lines of credit.

Previous wording

Income or loss from customer and other derivatives is largely from our customer interest rate derivative program. Income from customer and other derivatives totaled $0.4 million for the second quarter of 2026, down $0.6 million from the first quarter of 2026. The linked quarter decrease was largely attributable to the customer derivative program and is a product of volume and interest rate movement, partially offset by lower losses associated with assumption changes to the Visa Class B derivative liability. For the six months ended June 30, 2026, income from customer and other derivatives totaled $1.4 million, down $0.3 million from the same period in 2025. The year-over-year decrease was also driven by the customer derivative program. Derivative income can be volatile and is dependent upon the composition of the portfolio, volume and mix of sales and termination activity, and market value adjustments due to market interest rate movement.

Current wording

Income or loss from customer and other derivatives is largely from our customer interest rate derivative program. Income from customer and other derivatives totaled $0.1 million for the third quarter of 2026, down $0.3 million from the second quarter of 2026. The linked quarter decrease was largely attributable to losses associated with assumption changes to the Visa Class B derivative liability, partially offset by an increase in income from the customer derivative program that is a product of volume and interest rate movement during the quarter. For the nine months ended September 30, 2026, income from customer and other derivatives totaled $1.4 million, down $2.2 million from the same period in 2025. The year-over-year decrease was largely driven by the customer derivative program that is a product of volume and changes in the interest rate environment during the comparative periods. Derivative income can be volatile and is dependent upon the composition of the portfolio, volume and mix of sales and termination activity, and market value adjustments due to market interest rate movement.

Previous wording

Net gains on sales of premises, equipment and other assets consist primarily of net revenue earned from sales of excess-bank owned facilities and equipment no longer in use, gains on sales of Small Business Administration (SBA) and other non-residential mortgage loans, and leases and other assets associated with the equipment finance line of business. Net gains on sales of premises, equipment and other assets for the second quarter of 2026 totaled $1.6 million, down $0.4 million, or 20%, from the first quarter of 2026. For the six months ended June 30, 2026, net gains on sales of premises, equipment and other assets totaled $3.7 million, up $0.8 million, or 27%, from the same period in 2025. The level of net gains or losses on sales of these assets in a given reporting period will vary based on a variety of circumstances.

Current wording

Net gains on sales of premises, equipment and other assets consist primarily of net revenue earned from sales of excess-bank owned facilities and equipment no longer in use, gains on sales of Small Business Administration (SBA) and other non-residential mortgage loans, and leases and other assets associated with the equipment finance line of business. Net gains on sales of premises, equipment and other assets for the third quarter of 2026 totaled $1.3 million, down $0.3 million, or 21%, from the second quarter of 2026. For the nine months ended September 30, 2026, net gains on sales of premises, equipment and other assets totaled $5.0 million, down $0.2 million, or 4%, from the same period in 2025. The level of net gains or losses on sales of these assets in a given reporting period will vary based on a variety of circumstances.

Previous wording

Other miscellaneous income is comprised of various items, including income from investments in small business investment companies (SBIC), dividends on Federal Home Loan Bank (FHLB) stock, and fees from loan syndication and other specialty lines of business. Other miscellaneous income totaled $3.4 million, down $2.9 million from the first quarter of 2026. The linked quarter decrease reflects declines in income from SBICs, syndication income and dividends on FHLB stock. For the six months ended June 30, 2026, other miscellaneous income totaled $9.7 million, down $1.8 million from the same period in 2025. The year over year decrease was driven primarily by a decline in income from SBICs that was partially offset by an increase in dividends on FHLB stock. SBIC income and syndication fees will vary from period to period, depending on activity.

Current wording

Other miscellaneous income is comprised of various items, including income from investments in small business investment companies (SBIC), dividends on Federal Home Loan Bank (FHLB) stock, and fees from loan syndication and other specialty lines of business. Other miscellaneous income totaled $5.1 million, up $1.7 million from the second quarter of 2026. The linked quarter increase reflects increases in income from SBICs, syndication income and dividends on FHLB stock. For the nine months ended September 30, 2026, other miscellaneous income totaled $14.9 million, down $0.9 million from the same period in 2025. The year over year decrease was driven primarily by a decline in income from SBICs and syndication fees that was partially offset by an increase in dividends on FHLB stock. SBIC income and syndication fees will vary from period to period, depending on activity.

Previous wording

Noninterest expense for the second quarter of 2026 was $225.4 million, up $4.7 million, or 2%, from the first quarter of 2026, driven by personnel, other miscellaneous, professional services and occupancy and equipment expenses, partially offset by a decrease in data processing expense. For the six months ended June 30, 2026, noninterest expense totaled $446.2 million, up $25.1 million, or 6%, from the same period in 2025. Included in noninterest expense for six months ended June 30, 2025 were supplemental disclosure items totaling $5.9 million attributable to costs associated with the Sabal acquisition. Excluding the supplemental disclosure items, noninterest expense was up $31.1 million, or 7%, from the same period in 2025, largely driven by increases in personnel, business development, data processing and professional services expenses. A more detailed discussion of noninterest expense variances follows.

Current wording

Noninterest expense for the third quarter of 2026 was $262.0 million, up $36.6 million, or 16%, from the second quarter of 2026. Included in the three months ended September 30, 2026 were supplemental disclosure items totaling $29.4 million related to the acquisition of OFB Bancshares, Inc. Excluding the supplemental disclosure items, noninterest expense was up $7.2 million, or 3%, from the second quarter of 2026, driven largely by increases in personnel, and occupancy and equipment expense. For the nine months ended September 30, 2026, noninterest expense totaled $708.2 million, up $74.4 million, or 12%, from the same period in 2025. Included in noninterest expense for nine months ended September 30, 2026 were the $29.4 million of OFB acquisition-related supplemental disclosure items mentioned above. Included in the nine months ended September 30, 2025 were supplemental disclosure items totaling $5.9 million attributable to the Sabal acquisition. Excluding the supplemental disclosure items in each respective period, noninterest expense was up $51.0 million, or 8%, from the same period in 2025, with increases across most categories but largely driven by increases in personnel, business development, and data processing expenses. A more detailed discussion of noninterest expense variances follows.

Previous wording

Personnel expense consists of salaries, incentive compensation, long-term incentives, payroll taxes, and other employee benefits such as 401(k), pension, and insurance for medical, life and disability. Personnel expense totaled $130.2 million for the second quarter of 2026, up $3.0 million, or 2%, from the first quarter of 2026. The linked quarter increase was driven primarily by increases in salary expense as a result of annual merit increases and increased headcount, commissions and incentives associated with production, share-based compensation and certain employee benefits. These increases were partially offset by seasonal declines in payroll tax and certain other employee benefits, and a favorable benefit from salary deferrals associated with lending activity. For the six months ended June 30, 2026, personnel expense totaled $257.3 million, up $26.5 million, or 11%, from the same period in 2025. The six months ended June 30, 2025 included $1.4 million of Sabal acquisition costs highlighted as supplemental disclosure items. Excluding the Sabal acquisition costs, personnel expense for the six months ended June 30, 2026 was up $27.9 million, or 12%, from the same period in 2025. The year-over-year increase reflects increases in most components of this category, and reflects both expected annual increases in salary, incentives, bonus and associated benefit costs, and incremental expense associated with increased headcount that includes both Sabal associates and additional hires of revenue-producing and facility management associates.

Current wording

Personnel expense consists of salaries, incentive compensation, long-term incentives, payroll taxes, and other employee benefits such as 401(k), pension, and insurance for medical, life and disability. Personnel expense totaled $144.8 million for the third quarter of 2026, up $14.6 million, or 11%, from the second quarter of 2026. The three months ended September 30, 2026 included $8.3 million of OFB acquisition costs highlighted as supplemental disclosure items. Excluding the OFB acquisition costs, personnel expense for the third quarter of 2026 were up $6.2 million, or 5%, from the second quarter of 2026. The linked quarter increase was driven primarily by $3.6 million of expense attributable to the addition of OFB associates and by increases in salary expense as a result of increased headcount, commissions and incentives associated with production, certain employee benefits and a decrease in benefit from salary deferrals associated with lending activity. These increases were partially offset by a decrease in certain other employee benefits. For the nine months ended September 30, 2026, personnel expense totaled $402.1 million, up $49.2 million, or 14%, from the same period in 2025. The nine months ended September 30, 2026 and 2025 included $8.3 million and $1.4 million, respectively, of acquisition costs highlighted as supplemental disclosure items. Excluding the acquisition costs in each respective period, personnel expense for the nine months ended September 30, 2026 was up $42.3 million, or 12%, from the same period in 2025. The year-over-year increase reflects increases in most components of this category, and reflects both expected annual increases in salary, incentives, bonus and associated benefit costs, and incremental expense associated with increased headcount that includes the addition of OFB associates and additional hires of revenue-producing associates, and facility management associates whose function was previously outsourced.

Previous wording

Occupancy and equipment expenses are primarily composed of lease expenses, depreciation, maintenance and repairs, rent, property taxes, and other equipment expenses. Occupancy and equipment expenses totaled $18.3 million for the second quarter of 2026, up $1.0 million, or 6%, from the first quarter of 2026, primarily attributable to increases in building repair and maintenance and leased facility expense. For the six months ended June 30, 2026, occupancy and equipment expenses totaled $35.6 million, down $0.5 million, or 1%, compared to the same period in 2025. The year-over-year decrease was driven by decreases in facility repair and maintenance and outsourced facility management that were partially offset by an increase in leased facility expense.

Current wording

Occupancy and equipment expenses are primarily composed of lease expenses, depreciation, maintenance and repairs, rent, property taxes, and other equipment expenses. Occupancy and equipment expenses totaled $20.1 million for the third quarter of 2026, up $1.8 million, or 10%, from the second quarter of 2026, primarily attributable to increases in equipment expense, building repair and maintenance, utilities and leased facility expense. For the nine months ended September 30, 2026, occupancy and equipment expenses totaled $55.6 million, up $1.4 million, or 3%, compared to the same period in 2025. The year over year increase was mostly driven by leased facility expense and equipment expense that was partially offset by decreases in facility repair and maintenance, outsourced facility management, and insurance expense.

Previous wording

Data processing expense includes expenses related to third party technology processing and servicing costs, technology project costs and fees associated with bank card and ATM transactions, and credit card reward expenses. Data processing expense was $31.7 million for the second quarter of 2026, down $1.1 million, or 3%, from the first quarter of 2026. The linked quarter decrease was driven primarily by declines in maintenance on bank owned software and certain third-party technology processing expenses, partially offset by an increase in activity-based card processing and rewards and rebate expenses. For the six months ended June 30, 2026, data processing expense totaled $64.5 million, down $0.2 million, or less than 1%, from the same period in 2025. The six months ended June 30, 2025 included $2.0 million of Sabal acquisition costs highlighted as supplemental disclosure items. Excluding the Sabal acquisition costs, data processing expense for the six months ended June 30, 2026 was up $1.8 million, or 3%, from the same period in 2025. The year over year increase was largely attributable to increases in certain third-party technology processing and activity-based card processing and rewards and rebates expenses, partially offset by a decrease in amortization and maintenance on bank owned software. Data processing expense can vary from period to period, depending on business needs and technology enhancement initiatives.

Current wording

Data processing expense includes expenses related to third party technology processing and servicing costs, technology project costs and fees associated with bank card and ATM transactions, and credit card reward expenses. Data processing expense was $38.7 million for the third quarter of 2026, up $7.0 million, or 22%, from the second quarter of 2026. The three months ended September 30, 2026 included $7.8 million of OFB acquisition costs highlighted as supplemental disclosure items, largely related to software contract terminations. Excluding the OFB acquisition costs, data processing expense for the third quarter of 2026 was down $0.8 million, or 3%, from the second quarter of 2026. The linked quarter decrease was driven primarily by a decline in activity-based card processing expenses and certain third-party technology processing expenses, partially offset by increases in maintenance on bank owned software and expense associated with an outsourced ATM provider. For the nine months ended September 30, 2026, data processing expense totaled $103.2 million, up $7.8 million, or 8%, from the same period in 2025. The nine months ended September 30, 2026 and 2025 included $7.8 million and $2.0 million, respectively, of acquisition costs highlighted as supplemental disclosure items. Excluding the acquisition costs in each respective period, data processing expense for the nine months ended September 30, 2026 was up $2.0 million, or 2%, from the same period in 2025. The year over year increase was largely attributable to increases in certain third-party technology processing and activity-based card processing and rewards and rebates expenses, partially offset by a decrease in amortization and maintenance on bank owned software. Data processing expense can vary from period to period, depending on business needs and technology enhancement initiatives.