HomeTrust Bancshares, Inc.

Previous wording

•533,240 shares of Company common stock were repurchased during the current quarter at an average price of $42.85 compared to 241,201 shares repurchased at an average price of $42.19 in the prior quarter.

Current wording

•153,606 shares of Company common stock were repurchased during the current quarter at an average price of $46.31 compared to 533,240 shares repurchased at an average price of $42.85 in the prior quarter.

Previous wording

Net Income. Net income totaled $16.8 million, or $0.99 per diluted share, for the three months ended March 31, 2026 compared to $16.1 million, or $0.93 per diluted share, for the three months ended December 31, 2025, an increase of $648,000, or 4.0%. The results for the three months ended March 31, 2026 compared to the three months ended December 31, 2025 benefited from a $1.7 million decrease in the provision for credit losses and a $635,000 increase in noninterest income, partially offset by a $1.3 million increase in the noninterest expense. Details of the changes in the various components of net income are further discussed below.

Current wording

Net Income. Net income totaled $15.6 million, or $0.94 per diluted share, for the three months ended June 30, 2026 compared to $16.8 million, or $0.99 per diluted share, for the three months ended March 31, 2026, a decrease of $1.2 million, or 6.8%. The results for the three months ended June 30, 2026 compared to the three months ended March 31, 2026 were negatively impacted by a $784,000 decrease in noninterest income and a $1.0 million increase in noninterest expense due to a $1.1 million loss resulting from the redemption of junior subordinated debt securities, partially offset by a $1.0 million increase in net interest income. Details of the changes in the various components of net income are further discussed below.

Previous wording

For the quarter ended December 31,2025, the "loans" portion of the provision for credit losses was primarily the result of the following, offset by net charge-offs of $3.1 million during the quarter:

Current wording

For the quarter ended March 31, 2026, the "loans" portion of the provision for credit losses was primarily the result of the following, offset by net charge-offs of $1.8 million during the quarter:

Previous wording

Noninterest Income. Noninterest income for the three months ended March 31, 2026 increased $635,000, or 6.8%, when compared to the quarter ended December 31, 2025. Changes in the components of noninterest income are discussed below:

Current wording

Noninterest Income. Noninterest income for the three months ended June 30, 2026 decreased $784,000, or 7.8%, when compared to the quarter ended March 31, 2026. Changes in the components of noninterest income are discussed below:

Previous wording

•Gain on sale of loans held for sale: The increase was primarily driven by an increase in the sales volume of HELOC loans originated for sale, partially offset by reduced sales volume of residential mortgage loans and SBA commercial loans. There were $103.0 million of HELOCs originated for sale which were sold during the current quarter with gains of $934,000 compared to $13.7 million sold with gains of $121,000 in the prior quarter. There were $23.3 million of residential mortgage loans sold for gains of $431,000 during the current quarter compared to $31.1 million sold with gains of $606,000 in the prior quarter. There were $16.4 million in sales of the guaranteed portion of SBA commercial loans with gains of $1.2 million for the current quarter compared to $18.9 million sold and gains of $1.5 million for the prior quarter. Our hedging of mandatory commitments on the residential mortgage loan pipeline resulted in a net gain of $68,000 for the current quarter compared to a net loss of $295,000 for the prior quarter.

Current wording

•Gain on sale of loans held for sale: The decrease was primarily driven by a drop in the sales volume of HELOC loans originated for sale, partially offset by an increase in the sales volume of residential mortgage loans. There were $17.2 million of HELOCs originated for sale which were sold during the current quarter with gains of $93,000 compared to $103.0 million sold with gains of $934,000 in the prior quarter. There were $39.9 million of residential mortgage loans sold for gains of $481,000 during the current quarter compared to $23.3 million sold with gains of $431,000 in the prior quarter. There were $15.3 million in sales of the guaranteed portion of SBA commercial loans with gains of $1.3 million for the current quarter compared to $16.4 million sold and gains of $1.2 million for the prior quarter. Lastly, our hedging of mandatory commitments on the residential mortgage loan pipeline resulted in a net gain of $4,000 for the current quarter compared to $68,000 for the prior quarter.

Previous wording

Noninterest Expense. Noninterest expense for the three months ended March 31, 2026 increased $1.3 million, or 4.0%, when compared to the three months ended December 31, 2025. Changes in the components of noninterest expense are discussed below:

Current wording

Noninterest Expense. Noninterest expense for the three months ended June 30, 2026 increased $1.0 million, or 3.0%, when compared to the three months ended March 31, 2026. Changes in the components of noninterest expense are discussed below:

Previous wording

Income Taxes. The amount of income tax expense is influenced by the amount of pre-tax income, tax-exempt income, changes in the statutory rate and the effect of changes in valuation allowances maintained against deferred tax benefits. The effective tax rates for the three months ended March 31, 2026 and December 31, 2025 were 20.1% and 18.7%, respectively, with the quarter-over-quarter increase driven by the prior quarter impact of the Company's investment in a tax credit equity fund.

Current wording

Income Taxes. The amount of income tax expense is influenced by the amount of pre-tax income, tax-exempt income, changes in the statutory rate and the effect of changes in valuation allowances maintained against deferred tax benefits. The effective tax rates for the three months ended June 30, 2026 and March 31, 2026 were 20.4% and 20.1%, respectively.

Previous wording

(4)Tax-equivalent results include adjustments to interest income of $435 and $448 for the three months ended March 31,2026 and December 31, 2025, respectively, calculated based on combined federal and state tax rates of 23% and 24% for the same periods, respectively.

Current wording

(4)Tax-equivalent results include adjustments to interest income of $892 and $849 for the six months ended June 30, 2026 and 2025, respectively, calculated based on combined federal and state tax rates of 23% and 24% for the same periods, respectively.

Previous wording

Total interest and dividend income for the three months ended March 31, 2026 decreased $2.0 million, or 3.1%, when compared to the three months ended December 31, 2025. A decline of $1.9 million, or 3.1%, in loan interest income drove this change, primarily due to fewer days in the current quarter and the impact of decreases in the federal funds rate upon loan yields, partially offset by an increase of $348,000 in accretion income.

Current wording

Total interest and dividend income for the six months ended June 30, 2026 decreased $4.6 million, or 3.6%, when compared to the six months ended June 30, 2025. A decline of $3.8 million, or 3.2%, in interest income drove this change, primarily due to the impact of decreases in the federal funds rate upon loan yields. Accretion income on acquired loans of $1.1 million and $1.3 million was recognized during the same periods, respectively, and was included in loan interest income.

Previous wording

Total interest expense for the three months ended March 31, 2026 decreased $2.1 million, or 10.7%, when compared to the three months ended December 31, 2025. A decline of $2.1 million, or 10.9%, in deposit interest expense drove this change, the result of a decline in the average balance of certificate accounts, specifically brokered deposits, a decline in the average cost of funds across funding categories, and fewer days in the current quarter.

Current wording

Total interest expense for the six months ended June 30, 2026 decreased $7.1 million, or 17.6%, when compared to the six months ended June 30, 2025. A decline of $6.8 million, or 17.3%, in deposit interest expense drove this change, the result of a decline in the average balance of certificate accounts, specifically brokered deposits, in addition to a decline in the average cost of funds across funding categories.

Previous wording

•Gain on sale of premises and equipment: In both periods presented, gains were recognized on the sale of excess parcels of land.

Current wording

•Gain on sale of premises and equipment: In both periods presented, gains were recognized on the sale of excess parcels of real estate.

Previous wording

•Salaries and employee benefits: The increase was primarily the result of a $449,000 increase in incentive compensation and $409,000 in additional FICA taxes.

Current wording

•Salaries and employee benefits: The increase was primarily the result of increases in both pay and incentive compensation.

Previous wording

General. Total assets decreased by $159.3 million to $4.4 billion and total liabilities decreased by $151.0 million to $3.8 billion at March 31,2026 as compared to December 31, 2025. These changes can be traced to the use of proceeds from both loan sales and loan paydowns to offset a $70.5 million decline in deposits. The decrease in deposits was the result of a $116.1 million reduction in brokered deposits, partially offset by an increase of $45.7 million in all other deposit categories.

Current wording

General. Total assets decreased by $105.4 million to $4.4 billion and total liabilities decreased by $105.3 million to $3.8 billion at June 30,2026 as compared to December 31, 2025. These changes can be traced to the use of existing liquidity and the proceeds from loan sales to offset a $103.2 million decline in deposits. The decrease in deposits was the result of a $134.6 million reduction in brokered deposits, partially offset by an increase of $31.5 million in all other deposit categories.

Previous wording

Cash and Cash Equivalents. Total cash and cash equivalents decreased $24.0 million, or 7.4%, to $300.7 million at March 31, 2026 from $324.7 million at December 31, 2025.

Current wording

Cash and Cash Equivalents. Total cash and cash equivalents decreased $52.1 million, or 16.1%, to $272.5 million at June 30, 2026 from $324.7 million at December 31, 2025.

Previous wording

Certificates of Deposit in Other Banks. Total certificates of deposit in other banks decreased $5.2 million, or 27.7%, to $13.6 million at March 31, 2026 compared to December 31, 2025.

Current wording

Certificates of Deposit in Other Banks. Total certificates of deposit in other banks decreased $7.2 million, or 38.3%, to $11.6 million at June 30, 2026 compared to December 31, 2025.

Previous wording

Debt Securities Available for Sale. Debt securities available for sale increased $7.2 million, or 5.0%, to $149.7 million at March 31, 2026 from $142.5 million at December 31, 2025. Outside of changes in value, the changes between periods were the result of $13.0 million in purchases, partially offset by $5.2 million in proceeds from the maturity, call and paydown of securities. All purchases were MBS and consistent with the composition of the existing securities held in the portfolio.

Current wording

Debt Securities Available for Sale. Debt securities available for sale increased $3.3 million, or 2.3%, to $145.9 million at June 30, 2026 from $142.5 million at December 31, 2025. Outside of fluctuations in value, the changes between periods were the result of $26.7 million in purchases, partially offset by $22.5 million in proceeds from the maturity, call and paydown of securities. All purchases were MBS and consistent with the composition of the existing securities held in the portfolio.

Previous wording

Loans Held for Sale. Loans held for sale decreased $97.2 million, or 47.3%, to $108.5 million at March 31, 2026 from $205.7 million at December 31, 2025. This was driven by a decrease of $103.3 million, or 63.4%, in HELOCs held for sale due to loan sales during the current quarter, partially offset by a $5.8 million, or 16.3%, increase in SBA loans held for sale.

Current wording

Loans Held for Sale. Loans held for sale decreased $84.8 million, or 41.2%, to $120.9 million at June 30, 2026 from $205.7 million at December 31, 2025. This was driven by a decrease of $81.1 million, or 49.8%, in HELOCs held for sale due to loan sales during the current period.

Previous wording

Loans, Net of Deferred Loan Fees and Costs. Loans held for investment totaled $3.5 billion at March 31, 2026, a decrease of $31.6 million, 0.9%, compared to the balance as of December 31, 2025. The following table illustrates the changes within the portfolio:

Current wording

Loans, Net of Deferred Loan Fees and Costs. Loans held for investment totaled $3.6 billion at June 30, 2026, an increase of $44.1 million, or 1.2%, compared to the balance as of December 31, 2025. The following table illustrates the changes within the portfolio:

Previous wording

SBA loans made up 48.3%, 46.5% and 23.1% of total nonperforming assets at March 31, 2026, December 31, 2025 and March 31, 2025, respectively. The year-over-year increase was primarily the result of a management decision to accelerate the repurchase of the sold portion of nonperforming SBA loans (fully guaranteed portion) to simplify the workout process.

Current wording

SBA loans made up 55.4%, 48.3% and 46.5% of total nonperforming assets at June 30, 2026, March 31, 2026 and December 31, 2025, respectively. The increase during the current six month period was primarily the result of a management decision to accelerate the repurchase of the sold portion of nonperforming SBA loans (fully guaranteed portion) to simplify the workout process.

Previous wording

Classified assets increased by $6.0 million, or 9.1%, to $72.2 million, or 1.65% of total assets, as of March 31, 2026 when compared to the balance of $66.2 million, or 1.46% of total assets, as of December 31, 2025. Similarly, classified assets increased by $31.5 million, or 77.4%, to $72.2 million, or 1.65% of total assets, as of March 31, 2026 when compared to the balance of $40.7 million, or 0.89% of total assets, as of March 31, 2025. SBA loans made up the largest portion of classified assets at $25.7 million and $27.3 million, respectively, as of March 31, 2026 and December 31, 2025, of which $18.1 million $19.8 million, respectively, was fully guaranteed. The remaining population of classified assets as of March 31, 2026 included $10.0 million of HELOCs, $9.3 million of 1-4 family residential real estate loans, $7.7 million of equipment finance loans (concentrated in the transportation sector) and $7.4 million of non-owner occupied CRE loans.

Current wording

Classified assets decreased by $1.5 million, or 2.0%, to $70.7 million, or 1.59% of total assets, as of June 30, 2026 when compared to the balance of $72.2 million, or 1.65% of total assets, as of March 31, 2026. Classified assets increased by $4.5 million, or 6.9%, to $70.7 million, or 1.59% of total assets, as of June 30, 2026 when compared to the balance of $66.2 million, or 1.46% of total assets, as of December 31, 2025. SBA loans made up the largest portion of classified assets at $32.3 million and $27.3 million, respectively, as of June 30, 2026 and December 31, 2025, of which $24.5 million and $19.8 million, respectively, was fully guaranteed. The remaining population of classified assets as of June 30, 2026 included $10.5 million of HELOCs, $10.0 million of 1-4 family residential real estate loans and $7.0 million of equipment finance loans (concentrated in the transportation sector).

Previous wording

Allowance for Credit Losses on Loans. The ACL on loans was $40.6 million, or 1.14% of total loans, at March 31,2026 compared to$41.5 million, or 1.16% of total loans, at December 31,2025. The drivers of this change are discussed inthe "Comparison of Results of Operations for the Quarters Ended March 31, 2026 and December 31, 2025 – Provision for Credit Losses" section above.

Current wording

Allowance for Credit Losses on Loans. The ACL on loans was $39.8 million, or 1.10% of total loans, at June 30,2026 compared to$41.5 million, or 1.16% of total loans, at December 31,2025. The drivers of this change are discussed inthe "Comparison of Results of Operations for the Six Months Ended June 30, 2026 and June 30, 2025 – Provision for Credit Losses" section above.

Previous wording

Net loan charge-offs totaled $1.8 million for the quarter ended March 31,2026 compared to $3.1 million and $1.3 million for the three months ended December 31, 2025 and March 31, 2025, respectively. For all three periods, net charge-offs were concentrated within our equipment finance portfolio, primarily related to over-the-road truck loans, where we recognized net charge-offs of $1.5 million, $2.0 million and $1.0 million for the same periods, respectively. Annualized net charge-offs as a percentage of average loans were 0.19% for the three months ended March 31,2026 as compared to 0.33% and 0.14% for the three months ended December 31, 2025 and March 31, 2025, respectively.

Current wording

Net loan charge-offs totaled $3.7 million for the six months ended June 30,2026 compared to $3.3 million for the same period last year. Net charge-offs were concentrated within our equipment finance portfolio, primarily related to over-the-road truck loans, where we recognized net charge-offs of $2.4 million and $2.1 million for the same periods, respectively. Annualized net charge-offs as a percentage of average loans were 0.19% for the six months ended June 30,2026 as compared to 0.18% for the six months ended June 30, 2025.

Previous wording

The decrease in deposits was driven by a reduction in brokered certificates of deposit of $116.1 million, partially offset by an increase of $45.7 million in core deposits and other certificates of deposit.

Current wording

The decrease in deposits was the result of a $134.6 million reduction in brokered deposits, partially offset by an increase of $31.5 million in all other deposit categories.

Previous wording

Stockholders' Equity. Stockholders' equity decreased $8.3 million, or 1.4%, to $592.4 million at March 31,2026 as compared to December 31,2025. Activity within stockholders' equity included $16.8 million in net income and $1.4 million in share-based compensation and stock option exercises, which was more than offset by $2.2 million in cash dividends declared and $23.1 million in stock repurchases. In addition, accumulated other comprehensive income declined by $622,000 due to an increase in the unrealized loss on available for sale securities due to higher market interest rates.

Current wording

Stockholders' Equity. Stockholders' equity decreased $90,000, to $600.6 million at June 30,2026 as compared to December 31, 2025. Activity within stockholders' equity included $32.4 million in net income and $4.0 million in share-based compensation and stock option exercises, partially offset by $4.6 million in cash dividends declared and $30.2 million in stock repurchases. In addition, accumulated other comprehensive income declined by $1.0 million due to an increase in the unrealized loss on available for sale securities due to higher market interest rates between December 31, 2025 and June 30, 2026.

Previous wording

Management maintains a liquidity position that it believes will adequately provide for funding of loan demand and deposit run-off that may occur in the normal course of business. We rely on a number of different sources in order to meet our potential liquidity demands. The primary sources are increases in deposit accounts, wholesale borrowings and cash flows from loan payments and the securities portfolio.

Current wording

Management maintains a liquidity position that it believes will adequately provide for funding of loan demand and deposit run-off that may occur in the normal course of business. We rely on a number of different sources in order to meet our expected liquidity demands. The primary sources are increases in deposit accounts, wholesale borrowings and cash flows from payments on the loan and securities portfolios.

Previous wording

In addition to these primary sources of funds, management has several secondary sources available to meet potential funding requirements. All qualifying one-to-four family loans, HELOCs, commercial real estate loans, multifamily loans and FHLB of Atlanta stock are pledged as collateral to secure outstanding FHLB advances while commercial construction loans, indirect auto loans, and equipment and municipal leases are pledged as collateral to secure outstanding FRB advances. At March 31, 2026, the Company had the ability to borrow $366.6 million through additional FHLB advances and $140.6 million through the unused portion of a line of credit with the FRB. At this same date, the Company maintained revolving lines of credit with four unaffiliated banks which totaled $135.0 million, all of which was unused.

Current wording

In addition to these primary sources of funds, management has several secondary sources available to meet potential funding requirements. All qualifying one-to-four family loans, HELOCs, commercial real estate loans, multifamily loans and FHLB of Atlanta stock are pledged as collateral to secure outstanding FHLB advances while commercial construction loans, indirect auto loans, and equipment and municipal leases are pledged as collateral to secure outstanding FRB advances. At June 30, 2026, the Company had the ability to borrow $373.4 million through additional FHLB advances and $30.6 million through the unused portion of a line of credit with the FRB. At this same date, the Company maintained revolving lines of credit with four unaffiliated banks which totaled $135.0 million, all of which was unused.

Previous wording

We also classify our securities portfolio as available for sale, providing an additional source of liquidity. Management believes that our securities portfolio is of high quality, of short duration, and the securities would therefore be readily marketable. In addition, we have historically sold fixed-rate mortgage loans in the secondary market to reduce interest rate risk and to create still another source of liquidity. From time to time we also utilize brokered time deposits to supplement our other sources of funds. Brokered time deposits are obtained by utilizing an outside broker that is paid a fee. This funding requires advance notification to structure the type of deposit desired by us. Brokered deposits can vary in term from one month to several years and have the benefit of being a source of longer-term funding. We also utilize brokered deposits to help manage interest rate risk by extending the term to repricing of our liabilities, enhance our liquidity and fund asset growth. Brokered deposits are typically from outside our primary market areas, and our brokered deposit levels may vary from time to time depending on competitive interest rate conditions and other factors. At March 31, 2026, brokered deposits totaled $155.2 million, or 4.3% of total deposits.

Current wording

We also classify our securities portfolio as available for sale, providing an additional source of liquidity. Management believes that our securities portfolio is of high quality, of short duration, and the securities would therefore be readily marketable. In addition, we have historically sold fixed-rate mortgage loans in the secondary market to reduce interest rate risk and to create still another source of liquidity. From time to time we also utilize brokered time deposits to supplement our other sources of funds. Brokered time deposits are obtained by utilizing an outside broker that is paid a fee. This funding requires advance notification to structure the type of deposit desired by us. Brokered deposits can vary in term from one month to several years and have the benefit of being a source of longer-term funding. We also utilize brokered deposits to help manage interest rate risk by extending the term to repricing of our liabilities, enhance our liquidity and fund asset growth. Brokered deposits are typically from outside our primary market areas, and our brokered deposit levels may vary from time to time depending on competitive interest rate conditions and other factors. At June 30, 2026, brokered deposits totaled $136.7 million, or 3.8% of total deposits.

Previous wording

Liquidity management is both a daily and long-term function of business management. Excess liquidity is generally invested in short-term investments, such as overnight deposits and federal funds. On a longer term basis, we maintain a strategy of investing in various lending products and debt securities, including MBS. On a stand-alone level we are a separate legal entity from the Bank and must provide for our own liquidity and pay our own operating expenses. Our primary source of funds consists of dividends or capital distributions from the Bank, although there are regulatory restrictions on the ability of the Bank to pay dividends. At March 31, 2026, we (on an unconsolidated basis) had liquid assets of $6.6 million.

Current wording

Liquidity management is both a daily and long-term function of business management. Excess liquidity is generally invested in short-term investments, such as overnight deposits and federal funds. On a longer term basis, we maintain a strategy of investing in various lending products and debt securities, including MBS. We are a separate legal entity from the Bank and must provide for our own liquidity and pay our own operating expenses. Our primary source of funds consists of dividends or capital distributions from the Bank, although there are regulatory restrictions on the ability of the Bank to pay dividends. At June 30, 2026, we (on an unconsolidated basis) had liquid assets of $6.6 million.

Previous wording

At the Bank level, we use our sources of funds primarily to meet our ongoing commitments, pay maturing deposits and fund withdrawals and to fund loan commitments. At March 31, 2026, the total approved loan commitments and unused lines of credit outstanding amounted to $323.1 million and $884.6 million, respectively. Certificates of deposit scheduled to mature in one year or less at March 31, 2026 totaled $745.4 million. It is management's policy to manage deposit rates that are competitive with other local financial institutions. Based on this strategy, we believe that a majority of maturing deposits will be retained.

Current wording

At the Bank level, we use our sources of funds primarily to meet our ongoing commitments, pay maturing deposits and fund withdrawals and to fund loan commitments. At June 30, 2026, the total approved loan commitments and unused lines of credit outstanding amounted to $296.2 million and $793.6 million, respectively. Certificates of deposit scheduled to mature in one year or less at June 30, 2026 totaled $722.6 million. It is management's policy to manage deposit rates to be competitive with other local financial institutions. Based on this strategy, we believe that a majority of maturing deposits will be retained.