ACNB CORP

Previous wording

ACNB Corporation is the financial holding company for the wholly-owned subsidiaries of ACNB Bank and ACNB Insurance Services. ACNB Bank provides a full range of retail and commercial financial services in Pennsylvania and Maryland primarily through its network of 33 community banking offices and a loan production office in Hunt Valley, Maryland. ACNB Insurance Services offers a broad range of property, casualty, health, life and disability insurance serving personal and commercial clients through office locations in Westminster, Maryland, and Gettysburg, Pennsylvania and is licensed to do business in 46 states.

Current wording

ACNB Corporation is the financial holding company for the wholly-owned subsidiaries of ACNB Bank and ACNB Insurance Services. ACNB Bank provides a full range of retail and commercial financial services in Pennsylvania and Maryland primarily through its network of 33 community banking offices and two loan production offices. ACNB Insurance Services offers a broad range of property, casualty, health, life and disability insurance serving personal and commercial clients through office locations in Westminster, Maryland, and Gettysburg, Pennsylvania and is licensed to do business in 46 states.

Previous wording

ACNB closed the Acquisition of Traditions effective February 1, 2025. Traditions contributed, after acquisition accounting adjustments, $877.7 million in assets, $648.5 million in loans and $741.5 million in deposits at the Acquisition date. Financial results for the nine months ended September 30, 2025 were impacted by two discrete items that were related to the Acquisition: a provision for credit losses on non-PCD loans of $4.2 million, net of taxes, and merger-related expenses, net of taxes, totaling $7.9 million.

Current wording

Financial results for the three months ended March 31, 2025 were impacted by two discrete items that were related to the Acquisition of Traditions Bancorp, Inc. which was completed on February 1, 2025: a provision for credit losses on non-PCD loans of $4.2 million, net of taxes, and merger-related expenses, net of taxes, totaling $6.2 million. Financial results for the three months ended March 31, 2025 include ACNB’s standalone results for the month of January 2025.

Previous wording

◦Loan Growth —Average loans increased $675.4 million and $618.5 million for the three and nine months ended September 30, 2025, respectively, compared to the same periods of 2024.

Current wording

◦Loan Growth —Average loans increased $208.6 million for the three months ended March 31, 2026, compared to the same period of 2025, driven primarily by the Acquisition and, to a lesser extent, organic growth

Previous wording

◦Deposit Growth —Average interest-bearing deposits increased $575.6 million and $537.6 million for the three and nine months ended September 30, 2025, respectively, compared to the same periods of 2024.

Current wording

◦Deposit Growth —Average interest-bearing deposits increased $151.8 million for the three months ended March 31, 2026 compared to the same period of 2025, driven primarily by the Acquisition and, to a lesser extent, promotional incentives on commercial checking accounts

Previous wording

◦Yield on Average Earning Assets —For the three and nine months ended September 30, 2025, the yield on average earning assets was 5.64% and 5.58%, respectively, an increase of 74 bps compared to both of the same periods of 2024.

Current wording

◦Yield on Average Earning Assets —For the three months ended March 31, 2026, the yield on average earning assets was 5.78%, an increase of 33 bps compared to the same period of 2025

Previous wording

•Asset Quality —The allowance for credit losses was $23.7 million at September 30, 2025 compared to $17.3 million at December 31, 2024. The increase was driven primarily by an initial allowance for credit losses of $5.5 million for non-PCD loans and $1.5 million for accruing PCD loans at the Acquisition date.

Current wording

•Asset Quality —The allowance for credit losses was $23.6 million at March 31, 2026, compared to $23.7 million at December 31, 2025

Previous wording

◦Annualized net charge-offs for the three and nine months ended September 30, 2025 were 0.02% and 0.01% of total average loans, respectively, compared to 0.01% for both of the same periods of 2024.

Current wording

◦Annualized net recoveries for the three months ended March 31, 2026 were 0.00% of total average loans outstanding, compared to net charge-offs of 0.01% for the same period of 2025

Previous wording

◦Non-performing loans were $10.0 million, or 0.43%, of total loans at September 30, 2025 compared to $6.6 million, or 0.39%, of total loans at September 30, 2024. The increase was driven primarily by the Acquisition.

Current wording

◦Non-performing loans were $9.6 million, or 0.41%, of total loans at March 31, 2026 compared to $10.0 million, or 0.43%, of total loans at March 31, 2025. The decrease was driven primarily by paydowns of loans

Previous wording

•Noninterest income —Noninterest income was $8.4 million and $24.3 million for the three and nine months ended September 30, 2025, respectively, an increase of $1.6 million and $5.4 million, respectively, for the same periods of 2024. The increase for the three months ended September 30, 2025 was driven primarily by the Acquisition. In addition to impact of the Acquisition, the increase for the nine months ended September 30, 2025 was also driven by a gain on life insurance proceeds.

Current wording

•Noninterest income —Noninterest income was $8.3 million for the three months ended March 31, 2026, an increase of $1.1 million for the same period of 2025. The increase for the three months ended March 31, 2026 was driven primarily by the Acquisition. In addition to impact of the Acquisition, the increase for the three months ended March 31, 2026 was also driven primarily by a gain on an asset held for sale, earnings on investment in bank-owned life insurance, other, and wealth management

Previous wording

The accounting policies that the Corporation’s management deems to be most important to the portrayal of its financial condition and results of operations, and that require management’s most difficult, subjective or complex judgment, often result in the need to make estimates about the effect of such matters which are inherently uncertain. The following accounting estimate is deemed to be critical by management:

Current wording

The accounting policies that the Corporation’s management deems to be most important to the portrayal of its financial condition and results of operations, because they require management’s most difficult, subjective or complex judgment, often result in the need to make estimates about the effect of such matters which are inherently uncertain. The following accounting estimate is deemed to be critical by management:

Previous wording

Allowance for Credit Losses — The ACL represents an amount which, in management’s judgment, is adequate to absorb expected credit losses on outstanding loans at the balance sheet date based on the evaluation of the size and current risk characteristics of the loan portfolio, past events, current conditions, reasonable and supportable forecasts of future economic conditions and prepayment experience. The ACL is measured and recorded upon the initial recognition of a financial asset. The ACL is reduced by charge-offs, net of recoveries of previous losses, and is increased or decreased by a provision for credit losses, which is recorded as a current period operating expense.

Current wording

Allowance for Credit Losses — The ACL represents an amount which, in management’s judgment, is adequate to absorb expected credit losses on outstanding loans at the balance sheet date based on the evaluation of the size and current risk characteristics of the loan portfolio, past events, current conditions, reasonable and supportable forecasts of future economic conditions and prepayment experience. The ACL is measured and recorded upon the initial recognition of a financial asset. The ACL is reduced by charge-offs, net of recoveries of previous losses, and is increased or decreased by a provision for (reversal of) credit losses, which is recorded as a current period operating expense.

Previous wording

Management believes it uses relevant information available to make determinations about the ACL and that it has established the existing allowance in accordance with GAAP. However, the determination of the ACL requires significant judgment, and estimates of expected credit losses in the loan portfolio can vary from the amounts actually observed. While management uses available information to recognize expected credit losses, future additions to the ACL may be necessary based on changes in the loans comprising the portfolio, changes in the current and forecasted economic conditions, changes in the interest rate environment which may directly impact prepayment and curtailment rate assumption, and changes in the financial condition of borrowers.

Current wording

Management believes it uses relevant information available to make determinations about the ACL and that it has established the existing allowance in accordance with GAAP. However, the determination of the ACL requires significant judgment, and estimates of expected credit losses in the loan portfolio can vary from the amounts actually observed. While management uses available information to recognize expected credit losses, future additions to the ACL may be necessary based on changes in the loans comprising the portfolio, changes in the current and forecasted economic conditions, changes in the interest rate environment which may directly impact prepayment and curtailment rate assumption, and changes in the financial condition of borrowers. As of March 31, 2026, the Company believes that its ACL was adequate.

Previous wording

Net interest income totaled $32.1 million for the three months ended September 30, 2025 compared to $20.9 million for the same period of 2024, an increase of $11.2 million. The FTE net interest margin for the three months ended September 30, 2025 was 4.27%, a 50 bps increase from 3.77% for the same period of 2024. The accretion impact of acquisition accounting adjustments on loans and deposits from the Acquisition was $2.1 million for the three months ended September 30, 2025. The Corporation manages the risk associated with changes in interest rates through the techniques described within Item 3, “Quantitative and Qualitative Disclosures About Market Risk” in this Quarterly Report on Form 10-Q.

Current wording

Net interest income totaled $32.5 million for the three months ended March 31, 2026 compared to $27.1 million for the same period of 2025, an increase of $5.4 million. The FTE net interest margin for the three months ended March 31, 2026 was 4.46%, a 39 bps increase from 4.07% for the same period of 2025. The increase in net interest income and FTE net interest margin was driven primarily by the repositioning of the investment securities portfolio as announced on Form 8-K on December 5, 2025, the Acquisition, and new loans and investment securities funded at higher rates than those that paid off or matured. The accretion impact of acquisition accounting adjustments on loans and deposits from the Acquisition was $1.9 million for the three months ended March 31, 2026. The Corporation manages the risk associated with changes in interest rates through the techniques described within Item 3, “Quantitative and Qualitative Disclosures About Market Risk” in this Quarterly Report on Form 10-Q.

Previous wording

The following table provides a comparative average balance sheet and net interest income analysis for the periods presented. The discussion following this table is based on these taxable-equivalent amounts.

Current wording

The following table provides a comparative average Consolidated Statement of Condition and net interest income analysis for the periods presented. Interest income and yields are presented on a FTE basis. The discussion following this table is based on these tax equivalent amounts.

Previous wording

The provision for credit losses and unfunded commitments were reversals of $584 thousand and $145 thousand, respectively, for the three months ended September 30, 2025 compared to provisions of $81 thousand and $40 thousand, respectively, for the same period of 2024. The reversal of the provision for credit losses for the three months ended September 30, 2025 was driven primarily by the movement of construction loans for completed projects, which are a higher loss rate segment, primarily to commercial real estate loans and other lower loss rate segments within the loan portfolio and the paydowns of loans with a specific reserve. The Corporation assesses risks and reserves required compared with the balances in the ACL and unfunded commitments quarterly.

Current wording

The provisions for credit losses and unfunded commitments were reversals of $76 thousand and $13 thousand, respectively, for the three months ended March 31, 2026 compared to a provision for credit losses of $6.0 million and a reversal of the provision for unfunded commitments of $480 thousand for the same period of 2025. The reversal of the provision for credit losses for the three months ended March 31, 2026 was driven primarily by the paydowns of loans with a specific reserve and the movement of construction loans for completed projects, which are a higher loss rate segment, to lower loss rate segments within the loan portfolio, primarily commercial real estate, partially offset by loan growth. The provision for credit losses for the three months ended March 31, 2025 was driven primarily by the Acquisition. The Corporation assesses risks and reserves required compared with the balances in the ACL and unfunded commitments quarterly.

Previous wording

Noninterest expenses increased $24.8 million during the nine months ended September 30, 2025 compared to the same period of 2024 driven primarily by the Acquisition. The more significant fluctuations by category explained below:

Current wording

Noninterest expenses decreased $5.7 million for the three months ended March 31, 2026 compared to the same period of 2025 driven primarily by the Acquisition. The more significant variations by category that were not solely a direct result of the Acquisition are explained below:

Previous wording

•Salaries and employee benefits, the largest component of noninterest expenses, increase was driven primarily by an increased number of employees attributable to the Acquisition, merit increases, and higher mortgage commissions.

Current wording

•The increase in salaries and employee benefits, the largest component of noninterest expenses, was driven primarily by an increased number of employees attributable to the Acquisition and merit increases

Previous wording

•Equipment expenses increase was driven primarily by the Acquisition and the implementation of additional products into the core processing system.

Current wording

•The increase in equipment was driven primarily by the Acquisition and the implementation of additional products into the core processing system

Previous wording

•Other increased $738 thousand driven primarily by the Acquisition and higher internet banking services.

Current wording

•The increase in other was driven primarily by higher internet banking services and supplies and postage

Previous wording

The Corporation recognized income tax expense of $4.0 million during the three months ended September 30, 2025 compared to $2.2 million during the same period of 2024. The provision for income taxes for the three months ended September 30, 2025 reflects a combined Federal and State ETR of 21.4% compared to an ETR of 23.4% for the same period of the prior year. Any variances from the federal statutory rate of 21% are generally due to tax-free income, which includes, but not limited to, interest income on tax-free loans and investment securities and income from bank-owned life insurance policies, federal income tax credits, the impact of non-tax deductible expenses and state taxes. Additionally, ACNB has incurred non-deductible costs related to the Acquisition which are recorded within merger-related expenses on the Consolidated Statements of Income.

Current wording

The Corporation recognized income tax expense of $3.6 million during the three months ended March 31, 2026 compared to an income tax benefit of $277 thousand during the same period of 2025. The provision for income taxes for the three months ended March 31, 2026 reflects a combined Federal and State ETR of 20.6%. The income tax benefit for the three months ended March 31, 2025 was due to the net loss driven by the Acquisition. The variances from the federal statutory rate of 21% are generally due to tax-free income, which includes, but not limited to, interest income on tax-free loans and investment securities and income from bank-owned life insurance policies, federal income tax credits, the impact of non-tax deductible expenses such as certain merger-related costs and state taxes.

Previous wording

ACNB uses investment securities to manage interest rate risk, provide collateral for certain funding products, provide liquidity and generate interest and dividend income. The investment portfolio is comprised of U.S. Government and agencies, mortgage-backed, state and municipal, and corporate securities. These securities provide the appropriate characteristics with respect to credit quality, yield and maturity relative to the management of the overall balance sheet.

Current wording

ACNB uses investment securities to manage interest rate risk, provide collateral for certain funding products, provide liquidity and generate interest and dividend income. The investment securities provide the appropriate characteristics with respect to credit quality, yield and maturity relative to the management of the overall Consolidated Statements of Condition.

Previous wording

Total investment securities were $526.6 million at September 30, 2025 compared to $459.5 million at December 31, 2024, an increase of 14.6%. Following the Acquisition date, ACNB completed the sale of approximately $98.0 million of investment securities previously held by Traditions with a yield of 5.03%. ACNB paid off $40.2 million of Traditions’ FHLB borrowings with a cost of 4.73% with the proceeds from the sale of the investment securities, and invested the remainder of the proceeds into investment securities with a yield of 5.07%. At September 30, 2025, the securities balance included a net unrealized loss on AFS securities of $31.0 million on amortized cost of $493.3 million compared to a net unrealized loss of $47.7 million on amortized cost of $441.6 million at December 31, 2024. At September 30, 2025, the securities balance included HTM securities with an amortized cost of $63.4 million and a fair value of $56.9 million as compared to an amortized cost of $64.6 million and a fair value of $56.9 million at December 31, 2024.

Current wording

Total investment securities were $535.8 million at March 31, 2026 compared to $531.1 million at December 31, 2025. At March 31, 2026, the securities balance included a net unrealized loss on AFS securities of $27.7 million on amortized cost of $499.3 million compared to a net unrealized loss of $24.2 million on amortized cost of $491.1 million at December 31, 2025. At March 31, 2026, the securities balance included HTM securities with an amortized cost of $63.2 million and a fair value of $56.2 million as compared to an amortized cost of $63.3 million and a fair value of $57.5 million at December 31, 2025.

Previous wording

Total loans, net of unearned income, outstanding increased $653.7 million, or 38.8%, from December 31, 2024 to September 30, 2025. The increase was driven primarily by the $648.5 million in loans purchased at the Acquisition date. Total acquisition accounting adjustments on loans were $20.1 million at September 30, 2025. The majority of the loan acquisition accounting adjustments are expected to accrete back through as income as loans pay off or mature. ACNB does not have a significant concentration of credit risk with any single borrower, industry or geographic location. Most of the Corporation’s lending activities are with customers located within the Bank’s Market Area.

Current wording

Total loans, net of unearned income, outstanding increased $18.7 million, or 0.8%, from December 31, 2025 to March 31, 2026. The increase was driven primarily by growth in the commercial real estate portfolio partially offset by a decrease in the real estate construction portfolio as a result of completed projects which primarily moved to commercial real estate loans. Total acquisition accounting adjustments on loans were $16.3 million at March 31, 2026. The majority of the loan acquisition accounting adjustments are expected to accrete back through as income as loans pay off or mature. ACNB does not have a significant concentration of credit risk with any single borrower, industry or geographic location other than within its primary Market Area.

Previous wording

The commercial real estate portfolio, which includes farmland, multifamily, owner-occupied and non-owner occupied commercial real-estate, grew $294.4 million, or 30.4%, compared to December 31, 2024. The following data related to the commercial real estate portfolio through the breakout charts excludes the impact of the acquisition accounting adjustments on loans. The collateral for these loans is primarily spread across Pennsylvania and Maryland, 65.7% and 32.0%, respectively, at September 30, 2025, compared to 56.0% and 42.1%, respectively, at December 31, 2024. Less than 3% of the portfolio is for real estate in Urban areas of Baltimore, Maryland and Philadelphia, Pennsylvania. The largest sectors of the commercial real estate portfolio are retail and mixed-use commercial rental units, office complexes and hotels, motels and bed and breakfast entities. Non-owner occupied commercial real estate represented 65.6% of the commercial real estate portfolio. Non-owner occupied commercial real estate borrowers are geographically dispersed throughout ACNB’s Market Area and are leasing commercial properties to a varied group of tenants including medical offices, retail space, and other commercial purpose facilities. Because of the varied nature of the tenants, in aggregate, management believes that these loans present an acceptable risk when compared to commercial loans in general.

Current wording

The commercial real estate portfolio, which includes farmland, multifamily, owner-occupied and non-owner occupied commercial real estate, grew $28.0 million, or 2.2%, compared to December 31, 2025. The growth in commercial real estate was spread across a variety of industries, including non-owner occupied apartment complex, owner occupied and non-owner occupied farming, non-owner occupied warehouse and owner occupied office complex categories. The following data related to the commercial real estate portfolio through the breakout charts excludes the impact of the acquisition accounting adjustments on loans. The collateral for these loans is primarily spread across Pennsylvania and Maryland, 65.1% and 33.1%, respectively, at March 31, 2026, compared to 65.8% and 32.1%, respectively, at December 31, 2025. Less than 3% of the portfolio is for real estate in urban areas of Baltimore, Maryland and Philadelphia, Pennsylvania. The largest sectors of the commercial real estate portfolio are retail and mixed-use commercial rental units, office complexes, apartment complexes and hotels, motels and bed and breakfast entities. Non-owner occupied commercial real estate represented 65.3% of the commercial real estate portfolio. Non-owner occupied commercial real estate borrowers are geographically dispersed throughout ACNB’s Market Area and are leasing commercial properties to a varied group of tenants including medical offices, retail space, and other commercial purpose facilities. Because of the varied nature of the tenants, in aggregate, management believes that these loans present an acceptable risk when compared to commercial loans in general.

Previous wording

The concentration of non-owner occupied commercial real estate, construction, and multi-family was 242.9% of total risk-based capital of the Bank as of September 30, 2025 compared to 207.0% of total risk-based capital of the Bank as of December 31, 2024. The increase was primarily a result of the addition of Traditions’ portfolio.

Current wording

The concentration of non-owner occupied commercial real estate, construction, and multi-family was 233.1% of total risk-based capital of the Bank as of March 31, 2026 compared to 239.0% of total risk-based capital of the Bank as of December 31, 2025.

Previous wording

Residential real estate mortgages totaled $593.3 million, an increase of $191.3 million, or 47.6%, compared to December 31, 2024. Included in the residential real estate mortgages are $217.3 million of commercial loans and $64.0 million of consumer loans secured by residential real estate mortgages. Total residential real estate mortgages include $52.0 million in junior liens. Junior liens inherently have more credit risk by virtue of the fact that another financial institution may have a senior security position in the case of foreclosure liquidation of collateral to extinguish the debt.

Current wording

Residential real estate mortgages totaled $602.3 million, an increase of $3.3 million, or 0.5%, compared to December 31, 2025. Included in the residential real estate mortgages are $226.7 million of commercial loans and $58.9 million of consumer loans secured by residential real estate mortgages, which includes $37.3 million of junior liens. Junior liens inherently have more credit risk by virtue of the fact that another financial institution may have a senior security position in the case of foreclosure liquidation of collateral to extinguish the debt.

Previous wording

The ACL at September 30, 2025 was $23.7 million, or 1.01% of total loans, net of unearned income as compared to $17.3 million, or 1.03% of loans, at December 31, 2024 and $17.2 million, or 1.03% of loans, at September 30, 2024. The increases of $6.4 million compared to December 31, 2024 and $6.4 million compared to September 30, 2024 were driven primarily by an initial $5.5 million ACL for non-PCD loans, which was recognized through the provision for credit losses, and a $1.5 million ACL for accruing PCD loans, which was recognized as an acquisition accounting adjustment to the amortized cost basis of the acquired loans, at the Acquisition date.

Current wording

The ACL at March 31, 2026 was $23.6 million, or 1.01% of total loans, net of unearned income as compared to $23.7 million, or 1.02% of loans, at December 31, 2025 and $24.6 million, or 1.06% of loans, at March 31, 2025.

Previous wording

Nonaccrual loans increased $1.2 million from December 31, 2024 to September 30, 2025 driven primarily by the Acquisition. All nonaccrual loans are to borrowers located within ACNB’s Market Area and were originated by ACNB’s banking subsidiary or were part of the Acquisition and were originated by Traditions’ banking subsidiary.

Current wording

Nonaccrual loans decreased $241 thousand from December 31, 2025 to March 31, 2026 driven primarily by paydowns. All nonaccrual loans are to borrowers located within ACNB’s Market Area and were originated by ACNB’s banking subsidiary or were part of the Acquisition and were originated by Traditions’ banking subsidiary.

Previous wording

ACNB relies on deposits as a primary source of funds for lending activities. The increase in deposits from December 31, 2024 to September 30, 2025 was driven primarily by the Acquisition. ACNB acquired $741.5 million in deposits at the Acquisition date. Historically, deposit balances fluctuate reflecting different balance levels held by local companies, government units and school districts during different times of the year. Included in total deposits at September 30, 2025 were municipal deposits totaling $139.8 million, or 5.7%, of total deposits compared to $111.0 million, or 6.2%, of total deposits at December 31, 2024. Time deposits increased $173.4 million and included brokered deposits totaling $44.0 million at September 30, 2025 compared to $24.1 million at December 31, 2024. ACNB Bank issued a net $20.0 million in short-term brokered time deposits during the nine months ended September 30, 2025. The loan-to-deposit ratio was 94.76% at September 30, 2025 compared to 93.89% at December 31, 2024.

Current wording

ACNB relies on deposits as a primary source of funds for lending activities. The increase in deposits from December 31, 2025 to March 31, 2026 was driven primarily by the increase in time deposits, noninterest-bearing demand and money markets. Time deposits included $89.1 million of brokered time deposits compared to $59.1 million at December 31, 2025, an increase of $30.0 million. The increase in noninterest-bearing demand deposits was driven primarily by growth in commercial balances due to promotional incentives on commercial checking accounts and the increase in money markets was driven primarily by growth in balances of both consumer and commercial accounts. Historically, deposit balances fluctuate reflecting different balance levels held by local companies, government units and school districts during different times of the year. Included in total deposits at March 31, 2026 were municipal deposits totaling $127.1 million, or 5.0%, of total deposits compared to $119.3 million, or 4.9%, of total deposits at December 31, 2025. The loan-to-deposit ratio was 93.01% at March 31, 2026 compared to 95.12% at December 31, 2025.

Previous wording

ACNB’s deposit pricing function employs a disciplined pricing approach based upon liquidity needs and alternative funding rates, but also strives to price deposits to be competitive with relevant local competition, including local government investment trusts, credit unions and larger regional banks. Based on total Bank deposits outstanding, consumer and commercial constituted approximately 59% and 41%, respectively, of total Bank deposits as of September 30, 2025 compared to approximately 63% and 37%, respectively, as of December 31, 2024. The ratio of uninsured and non-collateralized Bank deposits to total Bank deposits was 20.5% at September 30, 2025. As of September 30, 2025, cash on hand, the fair value of unencumbered investment securities and collateralized borrowing capacities at the FHLB and the Federal Reserve discount window at the Bank were 292.7% of uninsured and non-collateralized Bank deposits. At September 30, 2025, deposits from the 20 largest unrelated depositors, excluding internal accounts, of the Bank totaled $175.7 million, or 7.1%, of total Bank deposits compared to $143.4 million, or 7.9%, of total Bank deposits at December 31, 2024.

Current wording

ACNB’s deposit pricing function employs a disciplined pricing approach based upon liquidity needs and alternative funding rates, but also strives to price deposits to be competitive with relevant local competition, including local government investment trusts, credit unions and larger regional banks. Based on total Bank deposits outstanding, consumer and commercial constituted approximately 61% and 39%, respectively, of total Bank deposits as of both March 31, 2026 and December 31, 2025. The ratio of uninsured and non-collateralized Bank deposits to total Bank deposits was 17.7% at March 31, 2026. As of March 31, 2026, cash on hand, the fair value of unencumbered investment securities and collateralized borrowing capacities at the FHLB and the Federal Reserve discount window at the Bank were 349.5% of uninsured and non-collateralized Bank deposits. At March 31, 2026, deposits from the 20 largest unrelated depositors, excluding internal accounts, of the Bank totaled $174.9 million, or 6.9%, of total Bank deposits compared to $177.2 million, or 7.2%, of total Bank deposits at December 31, 2025.

Previous wording

Short-term borrowings are comprised primarily of securities sold under agreements to repurchase and short-term borrowings from the FHLB. As of September 30, 2025, short-term borrowings were $80.5 million, an increase of $64.6 million compared to $15.8 million at December 31, 2024. Short-term FHLB advances at September 30, 2025 were $50.0 million compared to none at December 31, 2024. Short-term FHLB borrowings are used forgeneral balance sheet management. Compared to December 31, 2024, securities sold under repurchase agreements balances increased by $11.3 million, or 71.4%, due to normal changes in the cash flow position of ACNB’s commercial and local government customer base. Agreements to repurchase accounts are within the commercial and local government customer base and have attributes similar to core deposits. Investment securities are pledged in sufficient amounts to collateralize these agreements. During the first quarter of 2025, ACNB paid off $40.2 million of short-term and long-term FHLB borrowings held by Traditions with a cost of 4.73% shortly following the Acquisition date.

Current wording

Short-term borrowings are comprised of securities sold under agreements to repurchase, short-term borrowings from the FHLB and federal funds purchased. As of March 31, 2026, short-term borrowings were $63.8 million, a decrease of $912 thousand compared to $64.7 million at December 31, 2025. Short-term FHLB advances were $45.0 million at both March 31, 2026 and December 31, 2025. Short-term FHLB borrowings are used forgeneral balance sheet management. Compared to December 31, 2025, securities sold under repurchase agreements balances decreased by $1.0 million, or 6.4%, due to normal changes in the cash flow position of ACNB’s commercial and local government customer base. Agreements to repurchase accounts are within the commercial and local government customer base and have attributes similar to core deposits. Investment securities are pledged in sufficient amounts to collateralize these agreements.

Previous wording

Long-term borrowings consist of longer-term advances from the FHLB, trust preferred subordinated debt and subordinated debt. Long-term borrowings totaled $255.4 million at September 30, 2025 compared to $255.3 million at December 31, 2024. Further borrowings will be used when necessary for a variety of risk management and funding purposes. Please refer to the Liquidity discussion below for more information on the Corporation’s ability to borrow.

Current wording

Long-term borrowings consist of longer-term advances from the FHLB, trust preferred subordinated debt and subordinated debt. Long-term borrowings totaled $215.4 million at March 31, 2026 compared to $255.4 million at December 31, 2025. During the three months ended March 31, 2026 the Company paid off $40.0 million of long-term FHLB borrowings. On March 12, 2026, the Company sold and issued $15.0 million in aggregate principal amount 5.875% fixed-to-floating rate subordinated notes due March 15, 2036. On March 31, 2026, the Company redeemed the $15.0 million in aggregate principal amount 4.00% fixed-to-floating rate subordinated notes that were issued on March 30, 2021. Further borrowings will be used when necessary for a variety of risk management and funding purposes. Please refer to the Liquidity discussion below for more information on the Corporation’s ability to borrow.

Previous wording

ACNB’s capital management strategies have been developed to provide an appropriate risk-adjusted rate of return, in the opinion of management, to shareholders, while maintaining levels above its internal minimums and “well-capitalized” regulatory position in relationship to its risk exposure. Total stockholders’ equity was $408.6 million at September 30, 2025 compared to $303.3 million at December 31, 2024. The primary driver of the increase to stockholders’ equity was the issuance of 2,035,246 shares of common stock, or $83.6 million, to acquire Traditions. Other impacts to stockholders’ equity during the nine months ended September 30, 2025 were net income of $26.2 million, a $13.1 million change in unrealized gains in AFS investment securities, cash dividends paid to ACNB Corporation stockholders of $10.5 million, and common stock repurchases of $8.7 million.

Current wording

ACNB’s capital management strategies have been developed to provide an appropriate risk-adjusted rate of return, in the opinion of management, to shareholders, while maintaining levels above its internal minimums and “well-capitalized” regulatory position in relationship to its risk exposure. Total stockholders’ equity was $425.5 million at March 31, 2026 compared to $420.0 million at December 31, 2025. The increase to stockholders’ equity during the three months ended March 31, 2026 was driven primarily by net income of $13.7 million partially offset by a $1.3 million change in unrealized gains in AFS investment securities, cash dividends paid to ACNB Corporation stockholders of $3.9 million, and common stock repurchases of $3.6 million.

Previous wording

ACNB Corporation has a Dividend Reinvestment and Stock Purchase Plan that provides registered holders of ACNB Corporation common stock with a convenient way to purchase additional shares of common stock by permitting participants in the plan to automatically reinvest cash dividends on all or a portion of the shares owned and to make quarterly voluntary cash payments under the terms of the plan. Participation in the plan is voluntary, and there are eligibility requirements to participate in the plan. During the nine months ended September 30, 2025, 17,050 shares were issued under this plan with proceeds in the amount of $838 thousand.

Current wording

ACNB Corporation has a Dividend Reinvestment and Stock Purchase Plan that provides registered holders of ACNB Corporation common stock with a convenient way to purchase additional shares of common stock by permitting participants in the plan to automatically reinvest cash dividends on all or a portion of the shares owned and to make quarterly voluntary cash payments under the terms of the plan. Participation in the plan is voluntary, and there are eligibility requirements to participate in the plan. During the three months ended March 31, 2026, 7,669 shares were issued under this plan with proceeds in the amount of $356 thousand.

Previous wording

At September 30, 2025, ACNB’s banking subsidiary had borrowing capacity of approximately $1.29 billion from the FHLB, of which $1.01 billion was available. At September 30, 2025, ACNB’s banking subsidiary could borrow approximately $56.7 million from the Discount Window, of which the full amount was available. The underlying collateral at the Discount Window is made up of eligible loan collateral held in a joint-custody account under the Bank’s name.

Current wording

At March 31, 2026, ACNB’s banking subsidiary had borrowing capacity of approximately $1.28 billion from the FHLB, of which $1.04 billion was available. At March 31, 2026, ACNB’s banking subsidiary could borrow approximately $55.0 million from the Discount Window, of which the full amount was available. The underlying collateral at the Discount Window is made up of eligible loan collateral held in a joint-custody account under the Bank’s name.

Previous wording

ACNB’s banking subsidiary maintains several unsecured Fed Funds lines with correspondent banks. As of September 30, 2025, Fed Funds line capacity at the banking subsidiary was $192.0 million, of which the full amount was available. ACNB Corporation maintains a $5.0 million unsecured line of credit with a correspondent bank, all of which was available for borrowing as of September 30, 2025. The Corporation also executed a guaranty for a note related to a $1.5 million commercial line of credit from a local bank, with customary terms and conditions for such a line, for ACNB Insurance Services, the borrower and a wholly-owned subsidiary of ACNB Corporation. The commercial line of credit is for general working capital needs as they arise by ACNB Insurance Services and did not have any outstanding balance as of September 30, 2025.

Current wording

ACNB’s banking subsidiary maintains several unsecured Fed Funds lines with correspondent banks. As of March 31, 2026, Fed Funds line capacity at the banking subsidiary was $192.0 million, of which the full amount was available. ACNB maintains a $5.0 million unsecured line of credit with a correspondent bank, all of which was available for borrowing as of March 31, 2026. The Corporation also executed a guaranty for a note related to a $1.5 million commercial line of credit from a local bank, with customary terms and conditions for such a line, for ACNB Insurance Services, the borrower and a wholly-owned subsidiary of ACNB Corporation. The commercial line of credit is for general working capital needs as they arise by ACNB Insurance Services.

Previous wording

Another source of liquidity is securities sold under repurchase agreements to customers of ACNB’s banking subsidiary totaling approximately $27.1 million and $15.8 million at September 30, 2025, and December 31, 2024, respectively. These agreements vary in balance according to the cash flow needs of customers and competing accounts at other financial organizations.

Current wording

Another source of liquidity is securities sold under repurchase agreements to customers of ACNB’s banking subsidiary totaling approximately $15.1 million and $16.1 million at March 31, 2026 and December 31, 2025, respectively. These agreements vary in balance according to the cash flow needs of customers and competing accounts at other financial organizations.

Previous wording

The liquidity of the parent company also represents an important aspect of liquidity management. The parent company’s cash outflows consist principally of dividends to shareholders and corporate expenses. The main source of funding for the parent company is the dividends it receives from its subsidiaries. Federal and state banking regulations place certain legal restrictions and other practicable safety and soundness restrictions on dividends paid to the parent company from the subsidiary bank.

Current wording

The liquidity of the parent company also represents an important aspect of liquidity management. The parent company’s cash outflows consist principally of dividends to shareholders, common stock repurchases and corporate expenses. The main source of funding for the parent company is the dividends it receives from its subsidiaries. Federal and state banking regulations place certain legal restrictions and other practicable safety and soundness restrictions on dividends paid to the parent company from the subsidiary bank.

Previous wording

The Corporation is party to financial instruments with OBS risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and, to a lesser extent, standby letters of credit. At September 30, 2025, the Corporation had unfunded outstanding commitments to extend credit of $553.5 million and outstanding standby letters of credit of $26.0 million. Because these commitments generally have fixed expiration dates and many will expire without being drawn upon, the total commitment level does not necessarily represent future cash requirements.

Current wording

The Corporation is party to financial instruments with OBS risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and, to a lesser extent, standby letters of credit. At March 31, 2026, the Corporation had unfunded outstanding commitments to extend credit of $582.7 million and outstanding standby letters of credit of $23.9 million. Because these commitments generally have fixed expiration dates and many will expire without being drawn upon, the total commitment level does not necessarily represent future cash requirements.