BayCom Corp

Previous wording

In light of these risks, uncertainties and assumptions, the forward-looking statements discussed in this report might not occur, and you should not put undue reliance on any forward-looking statements. Moreover, you should treat these statements as speaking only as of the date they are made and based only on information then actually known to us. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements included in this report or the reasons why actual results could differ from those contained in such statements, whether as a result of new information or to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. These risks could cause our actual results for the remainder of 2026 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of, us and could negatively affect our consolidated financial condition and results of operations as well as our stock price performance.

Current wording

In light of these risks, uncertainties and assumptions, the forward-looking statements discussed in this report might not occur, and you should not put undue reliance on any forward-looking statements. Moreover, you should treat these statements as speaking only as of the date they are made and based only on information then actually known to us. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements included in this report or the reasons why actual results could differ from those contained in such statements, whether as a result of new information or to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. These risks could cause our actual results for the remainder of 2026 and beyond to differ materially from those

Previous wording

Our principal business objective is to enhance shareholder value and generate consistent earnings growth by expanding our commercial banking franchise through organic growth, strategic loan and deposit transactions, and strategic acquisitions. Since its founding in 2010, growth has been predominantly acquisition-driven, and we have expanded our geographic footprint through ten successful acquisitions. We believe that our selective acquisition of community banks has yielded economies of scale and improved our efficiency. We have also achieved organic growth by leveraging opportunities within the metropolitan and community markets in which we operate. These markets provide significant opportunities to expand our commercial client base, increase interest-earning assets, and enhance market share. We believe our geographic footprint, which now includes the San Francisco Bay Area; the metropolitan markets of Los Angeles, California, Seattle, Washington, Denver, Colorado, and Las Vegas, Nevada; and community markets including Albuquerque, New Mexico, and Custer, Delta, and Grand Counties, Colorado, provides access to low-cost, stable core deposits in community markets that can be used to fund commercial loan growth. We strive to create an enhanced banking experience for our clients by providing a comprehensive suite of sophisticated banking products and services tailored to meet their needs, while delivering the high-quality, relationship-based client service associated with a community bank. At June 30, 2026, on a consolidated basis, the Company had approximately $2.6 billion in total assets, $2.1 billion in total loans, $2.2 billion in total deposits and $335.4 million in shareholders’ equity.

Current wording

Our principal business objective is to enhance shareholder value and generate consistent earnings growth by expanding our commercial banking franchise through organic growth, strategic loan and deposit transactions, and strategic acquisitions. Since its founding in 2010, growth has been predominantly acquisition-driven, and we have expanded our geographic footprint through ten successful acquisitions. We believe that our selective acquisition of community banks has yielded economies of scale and improved our efficiency. We have also achieved organic growth by leveraging opportunities within the metropolitan and community markets in which we operate. These markets provide significant opportunities to expand our commercial client base, increase interest-earning assets, and enhance market share. We believe our geographic footprint, which now includes the San Francisco Bay Area; the metropolitan markets of Los Angeles, California, Seattle, Washington, Denver, Colorado, and Las Vegas, Nevada; and community markets including Albuquerque, New Mexico, and Custer, Delta, and Grand Counties, Colorado, provides access to low-cost, stable core deposits in community markets that can be used to fund commercial loan growth. We strive to create an enhanced banking experience for our clients by providing a comprehensive suite of sophisticated banking products and services tailored to meet their needs, while delivering the high-quality, relationship-based client service associated with a community bank. At September 30, 2026, on a consolidated basis, the Company had approximately $2.68 billion in total assets, $2.13 billion in total loans, $2.29 billion in total deposits and $334.8 million in shareholders’ equity.

Previous wording

We continue to focus on growing our commercial loan portfolios through acquisitions as well as organic growth. At June 30,2026, our$2.1 billion total loan portfolio included $188.5 million, or 9.1%, of loans acquired through business combinations (all of which were recorded to their estimated fair values at the time of acquisition), and the remaining $1.9 billion, or 90.9%, consisted of loans we originated or purchased not as part of a business combination.

Current wording

Our near-term focus is on growing our commercial loan portfolio organically. We continue to evaluate acquisition opportunities, and we expect acquisitions to remain part of our long-term growth strategy, although there can be no assurance that we will complete any future acquisitions. At September 30, 2026, our $2.13 billion total loan portfolio included $175.5 million, or 8.2%, of loans acquired through business combinations (all of which were recorded at their estimated fair values at the time of acquisition), and the remaining $1.98 billion, or 91.8%, consisted of loans we originated or purchased other than as part of a business combination.

Previous wording

Changes in market interest rates, the slope of the yield curve, and the rates we earn on interest earning assets or pay on interest bearing liabilities have a significant impact on our net interest spread, net interest margin and net interest income. During 2025, the Federal Open Market Committee of the Federal Reserve (“FOMC”) lowered the target range for the federal funds rate in response to continued moderation in inflation and evolving economic conditions. The FOMC reduced the target range by 75 basis points, from 4.25%–4.50% at December 31, 2024, to 3.50%–4.25% by year-end 2025, where it remained as of June 30, 2026. All reductions occurred between September and December 2025. Correspondingly,

Current wording

Changes in market interest rates, the slope of the yield curve, and the rates we earn on interest earning assets or pay on interest bearing liabilities have a significant impact on our net interest spread, net interest margin and net interest income. After lowering the federal funds target range by 75 basis points in late 2025, to 3.50%-3.75%, the Federal Open Market Committee of the Federal Reserve held rates steady until September 2026, when it increased the target range by 25 basis points to 3.75%-4.00%. The prime rate was 7.00% at September 30, 2026. Additional details regarding net interest income are discussed below.

Previous wording

Our accounting and reporting policies conform to accounting principles generally accepted in the United States of America (“GAAP”) and to general practices within the banking industry. To prepare financial statements and interim financial statements in conformity with GAAP, management makes estimates, assumptions and judgments based on available information. These estimates, assumptions and judgments affect the amounts reported in the financial statements and accompanying notes and are based on information available as of the dates of the financial statements. As this information changes, actual results could differ from the estimates, assumptions and judgments reflected in the financial statements. In particular, management has identified several accounting policies that, due to the estimates, assumptions and judgments inherent in those policies, are critical to understanding our financial statements.

Current wording

Our accounting and reporting policies conform to accounting principles generally accepted in the United States of America (“GAAP”) and to general practices within the banking industry. To prepare financial statements and interim financial statements in conformity with GAAP, management makes estimates, assumptions and judgments based on available information. These estimates, assumptions and judgments affect the amounts reported in the financial statements and accompanying notes and are based on information available as of the dates of the financial statements. As this

Previous wording

Total assets. Total assets decreased $13.6 million, or 0.5%, to $2.6 billion at June 30, 2026, from December 31, 2025. The decrease primarily was due to a $29.1 million, or 14.1%, decrease in cash and cash equivalents, partially offset by a $3.0 million, or 1.7%, increase in investment securities available-for-sale at fair value and a $7.2 million, or 0.3%, increase in loans receivable, net.

Current wording

Total assets. Total assets increased $82.7 million, or 3.2%, to $2.7 billion at September 30, 2026, from December 31, 2025. The increase primarily was due to an $83.6 million, or 4.1%, increase in loans receivable, net and a $12.0 million, or 5.8%, increase in cash and cash equivalents, partially offset by a $9.9 million, or 78.8%, decrease in equity securities, at fair value and an $8.0 million, or 4.4%, decrease in investment securities available-for-sale at fair value.

Previous wording

Cash and cash equivalents. Cash and cash equivalents decreased $29.1 million, or 14.1%, to $177.4 million at June 30, 2026, from $206.5 million at December 31, 2025. The decrease primarily was due to a $24.1 million decrease in federal funds sold resulting from an increase in loan originations and purchases, and a decrease in deposits.

Current wording

Cash and cash equivalents. Cash and cash equivalents increased $12.0 million, or 5.8%, to $218.5 million at September 30, 2026, from $206.5 million at December 31, 2025. The increase primarily was due to a $16.2 million increase in federal funds sold and interest bearing balances at banks resulting from an increase in deposits and proceeds from sales and maturities of investment securities, partially offset by loan originations and purchase of investment securities available-for-sale.

Previous wording

Investment securities available-for-sale. Investment securities available-for-sale increased $3.0 million, or 1.7%, to $182.7 million at June 30, 2026, from $179.7 million at December 31, 2025. The increase was primarily attributable to purchases of investment securities, partially offset by routine maturities, principal repayments, and calls of investment securities, and to a lesser extent upward fair value adjustments related to unrealized gains on investment securities available-for-sale.

Current wording

Investment securities available-for-sale. Investment securities available-for-sale decreased $8.0 million, or 4.4%, to $171.7 million at September 30, 2026, from $179.7 million at December 31, 2025. The decrease was primarily attributable to sales, routine maturities, principal repayments, and calls of investment securities, partially offset by purchases of investment securities.

Previous wording

Equity securities. Equity securities decreased $847,000, or 6.7%, to $11.7 million at June 30, 2026 from $12.6 million at December 31, 2025, primarily due tothe redemption of one equity security for $1.0 million at par in the current quarter, with no gain or loss recognized, partially offset by positive mark-to-market adjustments recorded during the six months ended June 30, 2026.

Current wording

Equity securities. Equity securities decreased $9.9 million, or 78.8%, to $2.7 million at September 30, 2026 from $12.6 million at December 31, 2025, primarily due to the sale of $7.8 million of equity securities and the redemption of two equity securities for $1.7 million at par, with no gain or loss recognized on redemptions, during the nine months ended September 30, 2026.

Previous wording

Loans receivable, net. We originate a wide variety of loans with a focus on commercial real estate (“CRE”) loans and commercial and industrial loans. Total loans increased $7.2 million, or 0.3%, to $2.1 billion at June 30, 2026 from $2.0 billion at December 31, 2025. The increase was due to $114.4 million of new loan originations and $66.5 million of loan purchases, which were more than offset by $160.4 million of loan repayments and $11.6 million of loans sold.

Current wording

Loans receivable, net. We originate a wide variety of loans with a focus on commercial real estate (“CRE”) loans and commercial and industrial loans. Total loans increased an $83.6 million, or 4.1%, to $2.1 billion at September 30, 2026 from $2.0 billion at December 31, 2025. The increase was due to $260.6 million of new loan originations and $118.4 million of loan purchases, offset by $277.8 million of loan repayments and $13.7 million of loans sold. The Company’s purchase of loans was to supplement lower organic origination volume in the first half of 2026, with new loan originations increasing during the third quarter, with minimal additional loan purchases anticipated in 2026.

Previous wording

Acquired loans. As of June 30, 2026, our total loan portfolio included $188.5 million, or 9.1%, of loans acquired through business combinations (all of which were recorded at their estimated fair values as of the time of acquisition), of which $149.1 million had a remaining net premium or discount.

Current wording

Acquired loans. As of September 30, 2026, our total loan portfolio included $175.5 million, or 8.2%, of loans acquired through business combinations (all of which were recorded at their estimated fair values as of the time of acquisition), of which $37.6 million had a remaining net premium or discount.

Previous wording

As of June 30, 2026, acquired non-PCD loans totaled $39.4 million, with a remaining net premium of $543,000, compared to $121.1 million with a remaining net premium of $397,000 as of December 31, 2025. The decrease from December 31, 2025 was due to payoffs, paydowns, and migration to the general pool of $58.9 million of acquired loans during the current quarter, as the portfolio continued to season and such acquired loans exhibited risk characteristics indistinguishable from the Company’s originated loans with most of these loans having not been renewed or re-underwritten during the first half of 2026. The net premium for acquired non-PCD loans includes a credit discount based on estimated losses in the acquired loans, partially offset by any premium based on market interest rates on the date of acquisition.

Current wording

As of September 30, 2026, non-PCD loans acquired through business combinations totaled $35.5 million, with a remaining net premium of $422,000, compared to $121.1 million with a remaining net premium of $397,000 as of December 31, 2025. The decrease from December 31, 2025 was due to payoffs, paydowns, and migration to the general pool of $58.9 million of acquired loans during the second quarter of 2026, as the portfolio continued to season and such acquired loans exhibited risk characteristics indistinguishable from the Company’s originated loans with most of these loans having not been renewed or re-underwritten during the first nine months of 2026. The net premium for acquired non-PCD loans includes a credit discount based on estimated losses in the acquired loans, partially offset by any premium based on market interest rates on the date of acquisition.

Previous wording

As of June 30, 2026, acquired PCD loans totaled $2.1 million, with a remaining net non-credit discount of $298,000, compared to $16.1 million with a remaining net non-credit discount of $1.2 million as of December 31, 2025.

Current wording

As of September 30, 2026, PCD acquired loans through business combinations totaled $2.1 million, with a remaining net non-credit discount of $295,000, compared to $16.1 million with a remaining net non-credit discount of $1.2 million as of December 31, 2025. The decrease was primarily due to payoffs and paydowns.

Previous wording

Nonperforming assets and loans. Nonperforming assets generally consist of nonperforming loans and other real estate owned (“OREO”). Nonperforming loans include nonaccrual loans and accruing loans 90 days or more past due. The Company held no OREO at June 30, 2026 or December 31, 2025. Nonperforming loans decreased $3.6 million to $9.8 million, or 0.47% of total loans, at June 30, 2026, compared to $13.4 million, or 0.65% of total loans, at December 31, 2025.

Current wording

Nonperforming assets and loans. Nonperforming assets generally consist of nonperforming loans and other real estate owned (“OREO”). Nonperforming loans include nonaccrual loans and accruing loans 90 days or more past due. The Company held no OREO at September 30, 2026 or December 31, 2025. Nonperforming loans decreased $2.2 million to $11.2 million, or 0.52% of total loans, at September 30, 2026, compared to $13.4 million, or 0.65% of total loans, at December 31, 2025.

Previous wording

The decrease in nonperforming loans was primarily due to the payoff of six nonaccrual loans totaling $2.3 million and the sale of two nonaccrual loans totaling $7.7 million, partially offset by three new nonaccrual CRE loans totaling $6.4 million. The majority of nonperforming loans remain concentrated in the CRE portfolio, while consumer and other commercial loans continue to exhibit low levels of delinquencies. At June 30, 2026, nonaccrual loans included $1.4 million of loans 30–89 days past due and $4.7 million of loans less than 30 days past due. The $1.4 million of loans 30-89 days past due consisted of one loan and the $4.7 million of nonaccrual loans less than 30 days past due consisted of 13 loans, all of which were placed on nonaccrual due to borrower-specific financial concerns and other credit-related factors that raised reasonable doubt about the full collectability of principal and interest, rather than delinquency. At December 31, 2025, nonaccrual loans included $562,000 of loans 30–89 days past due and $9.4 million of loans less than 30 days past due. At December 31, 2025, the $9.4 million of loans less than 30 days past due was comprised of 15 loans all of which were placed on nonaccrual due to concerns over the financial condition of the borrowers.

Current wording

The decrease in nonperforming loans was primarily due to the payoff of ten nonaccrual loans totaling $4.1 million and the sale of two nonaccrual loans totaling $7.7 million, partially offset by four new nonaccrual CRE loans totaling $9.6 million. The majority of nonperforming loans remain concentrated in the CRE portfolio, while consumer and other commercial loans continue to exhibit low levels of delinquencies. At September 30, 2026, nonaccrual loans included $3.7 million of loans 30–89 days past due and $2.8 million of loans less than 30 days past due. The $3.7 million of loans 30-89 days past due consisted of two loans and the $2.8 million of nonaccrual loans less than 30 days past due consisted of nine loans, all of which were placed on nonaccrual due to borrower-specific financial concerns and other credit-related factors that raised reasonable doubt about the full collectability of principal and interest, rather than delinquency. At December 31, 2025, nonaccrual loans included $562,000 of loans 30–89 days past due and $9.4 million of loans less than 30 days past due. At December 31, 2025, the $9.4 million of loans less than 30 days past due was comprised of 15 loans all of which were placed on nonaccrual due to concerns over the financial condition of the borrowers.

Previous wording

Of the nonperforming loans at June 30, 2026, approximately $862,000 were guaranteed by governmental agencies, compared to $1.7 million at December 31, 2025. The decrease in government-guaranteed nonaccrual loans during this period reflected paydowns.

Current wording

Of the nonperforming loans at September 30, 2026, approximately $849,000 were guaranteed by governmental agencies, compared to $1.7 million at December 31, 2025. The decrease in government-guaranteed nonaccrual loans during this period reflected paydowns.

Previous wording

Loans may be acquired at a premium or discount to par value, in which case the premium is amortized (subtracted from) or accreted (added to) interest income over the remaining life of the loan. Generally, over time, the effects of loan discount accretion and loan premium amortization decrease as the purchased loans mature or pay off before maturity.

Current wording

Loans may be acquired at a premium or discount to par value, in which case the premium is amortized (subtracted from) or accreted (added to) interest income over the remaining life of the loan. Generally, over time, the effects of loan discount accretion and loan premium amortization decrease as the purchased loans mature or pay off before maturity. Upon the payoff of a loan before maturity, any remaining (unaccreted) discount or (unamortized) premium is immediately taken into interest income; as loan payoffs may vary significantly from quarter to quarter, so may the impact of discount accretion and premium amortization on interest income.

Previous wording

Modified loans to borrowers experiencing financial difficulty as of June 30, 2026 and December 31, 2025, totaled $2.0 million and $1.4 million, respectively. All such modified loans were on nonaccrual status as of each respective reporting date. Modified loans that are accruing and performing in accordance with their modified terms are not classified as nonperforming loans because they continue to accrue interest and demonstrate satisfactory payment performance despite their modified terms. There were no such modified loans at June 30, 2026 and December 31, 2025. At both June 30, 2026 and December 31, 2025, individually evaluated modified loans to borrowers experiencing financial difficulty had related allowances of $594,000 and none, respectively.

Current wording

Modified loans to borrowers experiencing financial difficulty as of September 30, 2026 and December 31, 2025, totaled $2.0 million and $1.4 million, respectively. All such modified loans were on nonaccrual status as of each respective reporting date. Modified loans that are accruing and performing in accordance with their modified terms are not classified as nonperforming loans because they continue to accrue interest and demonstrate satisfactory payment performance despite their modified terms. There were no such modified loans at September 30, 2026 and December 31, 2025. At September 30, 2026 and December 31, 2025, individually evaluated modified loans to borrowers experiencing financial difficulty had related allowances of $607,000 and none, respectively.

Previous wording

Allowance for credit losses for loans. The allowance for credit losses is determined by the Company on a quarterly basis, although management monitors the appropriate level of the allowance more frequently. We assess the allowance for credit losses based on three categories: (i) originated loans, (ii) acquired non-PCD loans, and (iii) acquired PCD loans. The allowance for credit losses reflects management’s estimate of current expected credit losses inherent in the loan portfolios. The computation includes elements of judgment and high levels of subjectivity.

Current wording

Allowance for credit losses for loans. The allowance for credit losses is determined by the Company on a quarterly basis, although management monitors the appropriate level of the allowance more frequently. The Company assesses the allowance for credit losses based onspecific allowances for individually analyzed loans and a pooled loans component which includes both quantitative and qualitative factors for loans that share similar risk characteristics. The Company also maintains a separate reserve for unfunded loan commitments, which is included in other liabilities. The allowance for credit losses reflects management’s estimate of expected credit losses over the contractual term of the loan portfolio, adjusted for expected prepayments. The computation includes elements of judgment and high levels of subjectivity.

Previous wording

At June 30, 2026, the Company’s allowance for credit losses for loans was $23.0 million, or 1.11% oftotal loans, compared to $21.2 million, or 1.03% of total loans, at December 31, 2025. Management currently believes that the allowance for credit losses at June 30, 2026 is adequate to absorb expected credit losses inherent in the Company’s loan portfolio. No assurance can be given, however, that adverse economic conditions or other circumstances will not result in increased losses in the portfolio.

Current wording

At September 30, 2026, the Company’s allowance for credit losses for loans was $23.7 million, or 1.10% of total loans, compared to $21.2 million, or 1.03% of total loans, at December 31, 2025. Management currently believes that the allowance for credit losses at September 30, 2026 is adequate to cover expected credit losses in the Company’s loan portfolio. No assurance can be given, however, that adverse economic conditions or other circumstances will not result in increased losses in the portfolio.

Previous wording

As of June 30, 2026, the Company individually evalu ated $9.9 million in loans, of which $7.8 million had a specific allowance totaling $2.9 million as of June 30, 2026. As of December 31, 2025, the Company individually evaluated $14.9 million in loans, of which $4.5 million had a specific allowance totaling $1.4 million.

Current wording

As of September 30, 2026, the Company individually evaluated $11.3 million in loans, of which $6.4 million had a specific allowance totaling $2.6 million as of September 30, 2026. As of December 31, 2025, the Company individually evaluated $14.9 million in loans, of which $4.5 million had a specific allowance totaling $1.4 million.

Previous wording

Management considers the allowance for credit losses for loans at June 30, 2026 to be adequate to cover expected credit losses inherent in the loan portfolio based on the assessment of current portfolio performance, historical loss experience, and relevant qualitative and quantitative factors, including current economic conditions and reasonable and supportable forecasts. While management believes the estimates and assumptions used in determining the adequacy of the allowance are reasonable, actual credit losses may differ from those expected. Changes in economic conditions, borrower performance, or other factors could result in actual losses exceeding the current allowance, which could adversely affect the Company’s financial condition and results of operations. In addition, the methodology, assumptions, and judgments used in determining the allowance for credit losses are subject to review by bank regulators, as part of their routine examination process, which may result in adjustments to the provision for credit losses based upon information available to them at the time of their examination.

Current wording

Management considers the allowance for credit losses for loans at September 30, 2026 to be adequate to cover expected credit losses in the loan portfolio based on the assessment of current portfolio performance, historical loss experience, and relevant qualitative and quantitative factors, including current economic conditions and reasonable and supportable forecasts. While management believes the estimates and assumptions used in determining the adequacy of the allowance are reasonable, actual credit losses may differ from those expected. Changes in economic conditions, borrower performance, or other factors could result in actual losses exceeding the current allowance, which could adversely affect the Company’s financial condition and results of operations. In addition, the methodology, assumptions, and judgments used in determining the allowance for credit losses are subject to review by bank regulators, as part of their routine examination process, which may result in adjustments to the provision for credit losses based upon information available to them at the time of their examination.

Previous wording

Deposits. Deposits are our primary source of funding and generally consist of core deposits from the communities served by our branch and office locations. We offer a variety of deposit accounts with a competitive range of interest rates and terms to both consumers and businesses. Deposits include interest bearing and noninterest bearing demand accounts,

Current wording

Deposits. Deposits are our primary source of funding and generally consist of core deposits from the communities served by our branch and office locations. We offer a variety of deposit accounts with a competitive range of interest rates and terms to both consumers and businesses. Deposits include interest bearing and noninterest bearing demand accounts, savings accounts, money market accounts, certificates of deposit and individual retirement accounts. These accounts earn

Previous wording

savings accounts, money market accounts, certificates of deposit and individual retirement accounts. These accounts earn interest at rates established by management based on competitive market factors, management’s desire to increase certain product types or maturities, and consistent with our asset/liability, liquidity and profitability objectives. Competitive products, competitive pricing and high touch client service are important to attracting and retaining these deposits.

Current wording

interest at rates established by management based on competitive market factors, management’s desire to increase certain product types or maturities, and consistent with our asset/liability, liquidity and profitability objectives. Competitive products, competitive pricing and high touch client service are important to attracting and retaining these deposits.

Previous wording

Total deposits decreased $43.7 million, or 2.0%, to $2.2 billion at June 30, 2026, compared to December 31, 2025. At June 30, 2026, noninterest-bearing demand deposits totaled $576.5 million, or 26.6% of total deposits, compared to $578.1 million, or 26.1% of total deposits, at December 31, 2025, representing a decrease of $1.5 million. From December 31, 2025 to June 30, 2026, interest-bearing deposits generally decreased, with time deposits decreasing $106.2 million and NOW accounts decreasing $9.5 million, partially offset by money market accounts increasing $73.3 million, and savings accounts increasing $207,000. Time deposits included no brokered deposits as of June 30, 2026, and December 31, 2025.

Current wording

Total deposits increased $78.5 million, or 3.5%, to $2.3 billion at September 30, 2026, compared to December 31, 2025. At September 30, 2026, noninterest-bearing demand deposits totaled $574.2 million, or 25.1% of total deposits, compared to $578.1 million, or 26.1% of total deposits, at December 31, 2025, representing a decrease of $3.9 million. From December 31, 2025 to September 30, 2026, interest-bearing deposits generally increased, with money market account increasing $111.8 million, NOW accounts increasing $13.8 million, and savings accounts increasing $2.4 million, partially offset by time deposits decreasing $45.6 million. Time deposits included no brokered deposits as of September 30, 2026, and December 31, 2025.

Previous wording

The overall decrease in total deposits from December 31, 2025 primarily reflects declines in time deposits, partially offset by increases in money market accounts and, to a lesser extent, savings accounts. The increase in money market deposits reflects continued customer migration within the deposit portfolio in response to the prevailing rate environment. Management continues to monitor deposit mix and pricing strategies in the context of funding costs, liquidity needs, and interest rate risk.

Current wording

The overall increase in total deposits from December 31, 2025 primarily reflects growth in money market deposits, partially offset by decreases in time deposits due to maturity of higher rate deposits. The increase in money market deposits reflects continued customer migration within the deposit portfolio in response to the prevailing rate environment. Management continues to monitor deposit mix and pricing strategies in the context of funding costs, liquidity needs, and interest rate risk.

Previous wording

We consider our deposit base to be seasoned, stable and well-diversified, and we do not have any significant industry concentrations among our non-insured deposits. We also offer our customers the ability to place deposits in Certificate of Deposit Account Registry Service (“CDARS”) and Insured Cash Sweep (“ICS”) money market product services via the IntraFi Network, to ensure deposits above FDIC insurance limits. At June 30, 2026, our average deposit account size (excluding public funds), calculated by dividing period-end deposits by the population of accounts with balances, was approximately $62,000. See “Note 17 – Commitments and Contingencies” of the Notes to Condensed Consolidated Financial Statements in this Form 10-Q for information regarding our top ten depositors.

Current wording

We consider our deposit base to be seasoned, stable and well-diversified, and we do not have any significant industry concentrations among our non-insured deposits. We also offer our customers the ability to place deposits in Certificate of Deposit Account Registry Service (“CDARS”) and Insured Cash Sweep (“ICS”) money market product services via the IntraFi Network, to ensure deposits above FDIC insurance limits. At September 30, 2026, our average deposit account size (excluding public funds), calculated by dividing period-end deposits by the population of accounts with balances, was approximately $66,000. See “Note 17 – Commitments and Contingencies” of the Notes to Condensed Consolidated Financial Statements in this Form 10-Q for information regarding our top ten depositors.

Previous wording

At June 30, 2026 and December 31, 2025, we could borrow up to $531.0 million and$580.7 million, respectively, from the FHLB of San Francisco. At June 30, 2026, the Bank had $25.0 million of overnight advances outstanding from the FHLB, compared to no FHLB borrowings outstanding at December 31, 2025.

Current wording

At September 30, 2026 and December 31, 2025, we could borrow up to $579.8 million and $580.7 million, respectively, from the FHLB of San Francisco. At both September 30, 2026 and December 31, 2025, the Bank had no FHLB borrowings outstanding.

Previous wording

At June 30, 2026 and December 31, 2025, we could borrow up to $42.8 million and$49.3 million, respectively, from the FRB of San Francisco. At both June 30, 2026 and December 31, 2025, there were no FRB advances outstanding.

Current wording

At September 30, 2026 and December 31, 2025, we could borrow up to $41.8 million and $49.3 million, respectively, from the FRB of San Francisco. At both September 30, 2026 and December 31, 2025, there were no FRB advances outstanding.

Previous wording

The Bank is required to provide collateral for certain local agency deposits. At both June 30, 2026 and December 31, 2025, the FHLB of San Francisco had issued letters of credit on behalf of the Bank totaling $42.1 million and $41.6 million, respectively, as collateral for local agency deposits.

Current wording

The Bank is required to provide collateral for certain local agency deposits. At September 30, 2026 and December 31, 2025, the FHLB of San Francisco had issued letters of credit on behalf of the Bank totaling $42.1 million and $41.6 million, respectively, as collateral for local agency deposits.

Previous wording

Shareholders’ equity. Shareholders’ equity decreased $3.2 million, to $335.4 million at June 30, 2026 from $338.6 million at December 31, 2025. The decrease in shareholders’ equity primarily was due to $6.5 million of cash dividends paid or accrued during the period. These decreases were partially offset by a $1.4 million increase in common stock due to stock based compensation primarily related to accelerated vesting of shares for departing executives, net income of $1.2 million earned during the first six months of 2026 and $811,000 in other comprehensive income, net of taxes, which primarily reflected changes in the unrealized gain on available-for-sale securities. During the six months ended June 30, 2026, the Company did not repurchase any shares of common stock, compared to the repurchase of $5.2 million of common stock during the six months ended June 30, 2025. For additional information see Part II, Item 2, “Unregistered Sales of Equity Securities and Use of Proceeds.”

Current wording

Shareholders’ equity. Shareholders’ equity decreased $3.7 million, or 1.1%, to $334.8 million at September 30, 2026 from $338.6 million at December 31, 2025. The decrease in shareholders’ equity primarily was due to $9.8 million of cash dividends paid or accrued during the period. This decrease was partially offset by a $1.6 million increase in common stock due to stock-based compensation primarily related to accelerated vesting of shares for departing executives, net income of $2.4 million earned during the first nine months of 2026 and $2.1 million in other comprehensive income, net of taxes, which primarily reflected a decrease in net unrealized losses on available-for-sale securities, including the reclassification of realized losses on securities sold. During the nine months ended September 30, 2026, the Company did not repurchase any shares of common stock, compared to the repurchase of $6.1 million of common stock during the nine months ended September 30, 2025. For additional information see Part II, Item 2, “Unregistered Sales of Equity Securities and Use of Proceeds.”

Previous wording

Comparison of Results of Operations for the Three and Six months Ended June 30, 2026 and 2025

Current wording

Comparison of Results of Operations for the Three and Nine Months Ended September 30, 2026 and 2025

Previous wording

Earnings summary. The Company reported a net loss of $7.0 million for the three months ended June 30, 2026, compared to net income of $6.4 million for the three months ended June 30, 2025, a decrease of $13.3 million. The decrease was primarily a result of an $11.4 million increase in noninterest expense, largely attributable to the one-time recognition of $10.5 million of severance, accelerated equity award vesting and employee benefit costs associated with the previously announced departures of three senior executives, and a $5.0 million increase in the provision for credit losses. These changes were partially offset by a $568,000 increase in net interest income and a $2.6 million decrease in the provision for income taxes. Basic and diluted loss per share was $(0.64) for the three months ended June 30, 2026, compared to basic and diluted earnings per share was $0.58 for the three months ended June 30, 2025.

Current wording

Earnings summary. The Company reported a net income of $1.1 million for the three months ended September 30, 2026, compared to net income of $5.0 million for the three months ended September 30, 2025, a decrease of $3.9 million. The decrease was primarily a result of an $8.1 million decrease in noninterest income, largely attributable to the $6.8 million loss on the sale of available-for-sale investment securities, and a $1.7 million increase in noninterest expense. These changes were partially offset by a $2.2 million increase in net interest income, a $2.1 million decrease in the provision for credit losses, and $1.6 million decrease in the provision for income taxes. Basic and diluted earnings per share were $0.10 for the three months ended September 30, 2026, compared to $0.46 for the three months ended September 30, 2025.

Previous wording

Our efficiency ratio, which is calculated by dividing noninterest expense by the sum of net interest income before provision for credit losses and noninterest income, was 107.71% and 84.04% for the three and six months ended June 30, 2026, and 63.85% and 64.79% for the three and six months ended June 30, 2025, respectively. The change in the efficiency ratio for the current quarter was primarily attributable to the significant increase in noninterest expense due to costs of the previously announced departures of three senior executives, partially offset by higher net interest income.

Current wording

Our efficiency ratio, which is calculated by dividing noninterest expense by the sum of net interest income before provision for credit losses and noninterest income, was 89.41% and 85.52% for the three and nine months ended September 30, 2026, compared to 62.15% and 63.88% for the three and nine months ended September 30, 2025, respectively. The increase in the efficiency ratio for the current quarter was primarily attributable to the decrease in noninterest income resulting from the $6.8 million loss on the sale of available-for-sale securities, partially offset by higher net interest income. For the nine-month period, the increase was primarily due to higher noninterest expense, including $10.5 million of costs related to the previously announced departures of three senior executives, and the decrease in noninterest income resulting from the loss on the sale of available-for-sale securities, partially offset by higher net interest income.

Previous wording

Interest income. Interest income on loans, including fees, increased $251,000, or 0.9%, to $28.2 million for the three months ended June 30, 2026 from $28.0 million for the three months ended June 30, 2025, due to a $28.3 million increase in the average balance of loans, partially offset by a three basis point decrease in the average loan yield. The average balance of loans was $2.0 billion for the second quarter of 2026, up 1.42% compared to the second quarter of 2025. The average yield on loans was 5.60% for the second quarter of 2026, compared to 5.63% for the second quarter of 2025. The decrease in the average yield on loans reflected higher amortization of net premiums on acquired loans, partially offset by new loans being originated at higher market interest rates.

Current wording

balance of loans was $2.1 billion for the third quarter of 2026, up 3.11% compared to the third quarter of 2025. The average yield on loans was 5.72% for the third quarter of 2026, compared to 5.70% for the third quarter of 2025. The increase in the average yield on loans reflected new loans being originated at higher market interest rates, partially offset by higher amortization of net premiums on acquired loans.

Previous wording

Interest income on loans for the three months ended June 30, 2026 included $380,000 of amortization of net premiums on acquired loans, primarily due to continued seasoning and runoff of the acquired loan portfolio, which negatively impacted the average loan yield by eight basis points. During the three months ended June 30, 2025, $110,000 of accretion of the net discount was recognized, with minimal positive impact on the average loan yield. Remaining net premiums on these acquired loans totaled $245,000 and $319,000 at June 30, 2026 and 2025, respectively. Additionally, interest income on loans for the three months ended June 30, 2026 and 2025, included $110,000 and $109,000, respectively, in fees related to prepayment penalties.

Current wording

Interest income on loans for the three months ended September 30, 2026 included $67,000 of amortization of net premiums on acquired loans, compared to $155,000 accretion of the net discount for the three months ended September 30, 2025, with no significant impact to the average loan yield during these periods. At September 30, 2026, these acquired loans had a net premium of $127,000 compared to a $146,000 net discount at September 30, 2025. Additionally, interest income on loans for the three months ended September 30, 2026 and 2025, included $84,000 and $119,000, respectively, in fees related to prepayment penalties.

Previous wording

Interest income on investment securities decreased $139,000, or 5.8%, to $2.3 million for the three months ended June 30, 2026, compared to $2.4 million for the three months ended June 30, 2025, as a result of decreases in the average balance and average yield. The average balance of investment securities totaled $194.7 million for the three months ended June 30, 2026, compared to $206.5 million for the three months ended June 30, 2025. The average yield on investment securities was 4.67% for the three months ended June 30, 2026, compared to 4.68% for the three months ended June 30, 2025. The decreases in the average balance and the average yield from the same quarter a year ago were due to paydowns and calls on higher variable-rate securities and rate resets on variable rate securities. In addition, during the second quarter of 2026, we received $135,000 in cash dividends on our FRB and FHLB stock, compared to $392,000 during the second quarter of 2025, with the decrease due to the FHLB lowering the dividend rate in the current quarter.

Current wording

Interest income on investment securities decreased $72,000, or 3.1%, to $2.2 million for the three months ended September 30, 2026, compared to $2.3 million for the three months ended September 30, 2025, as a result of a decrease in the average balance, partially offset by an increase in the average yield. The average balance of investment securities totaled $184.6 million for the three months ended September 30, 2026, compared to $199.8 million for the three months ended September 30, 2025. The average yield on investment securities was 4.82% for the three months ended September 30, 2026, compared to 4.60% for the three months ended September 30, 2025. The decrease in the average balance from the same quarter a year ago was due to paydowns, calls and sales of securities, while the increase in the average yield reflected purchases of higher yielding securities, partially offset by rate resets on variable rate securities.** **In addition, during the third quarter of 2026, we received $400,000 in cash dividends on our FRB and FHLB stock, including $142,000 in special dividends from the FHLB, compared to $398,000 during the third quarter of 2025. Excluding the special dividends, dividends decreased, primarily due to the FHLB lowering its dividend rate in the second quarter of 2026.

Previous wording

Interest income on federal funds sold and interest-bearing balances in banks decreased $1.1 million, or 39.3%, to $1.6 million for the three months ended June 30, 2026, compared to $2.7 million for the three months ended June 30, 2025, as a result of decreases in both the average yield and average balance. The average yield decreased 75 basis points to 3.70% for the three months ended June 30, 2026, compared to 4.45% for the three months ended June 30, 2025, reflecting decreases in Federal Reserve policy rates. The average balance of federal funds sold and interest-bearing balance in banks totaled $177.3 million and $242.8 million for the three months ended June 30, 2026 and 2025, respectively.

Current wording

Interest income on federal funds sold and interest-bearing balances in banks decreased $1.4 million, or 47.8%, to $1.6 million for the three months ended September 30, 2026, compared to $3.0 million for the three months ended September 30, 2025, as a result of decreases in both the average yield and average balance. The average yield decreased 71 basis points to 3.73% for the three months ended September 30, 2026, compared to 4.44% for the three months ended September 30, 2025, reflecting decreases in Federal Reserve policy rates. The average balance of federal funds sold and interest-bearing balances in banks totaled $167.4 million and $269.8 million for the three months ended September 30, 2026 and 2025, respectively.

Previous wording

Interest income on loans, including fees, increased $2.7 million, or 4.9%, to $57.8 million for the six months ended June 30, 2026 from $55.1 million for six months ended June 30, 2025, primarily due to a $58.6 million increase in the average balance of loans to $2.0 billion, and an 11 basis point increase in the average loan yield. The average yield on loans was 5.74% for the six months ended June 30, 2026, compared to 5.63% for the six months ended June 30, 2025. The increase in the average yield on loans from the same period last year was due to the impact of increased rates on variable rate loans, new loans being originated at higher market interest rates, as well as recovery of interest on one large payoff discussed below.

Current wording

Interest income on loans, including fees, increased $3.7 million, or 4.4%, to $88.1 million for the nine months ended September 30, 2026 from $84.3 million for nine months ended September 30, 2025, primarily due to a $60.2 million increase in the average balance of loans to $2.1 billion, and a seven basis point increase in the average loan yield. The average yield on loans was 5.73% for the nine months ended September 30, 2026, compared to 5.66% for the nine months ended September 30, 2025. The increase in the average yield on loans from the same period last year was primarily due to the discount accretion and recovery of interest on one large payoff discussed below and new loans being originated at higher market interest rates, partially offset by accelerated premium amortization on acquired loans.

Previous wording

Interest income on loans for the six months ended June 30, 2026 and 2025 included $203,000 and $315,000 in accretion of the net discount on acquired loans and revenue from PCD loans in excess of discounts. During the first quarter of 2026, one $4.0 million acquired CRE loan paid off, resulting in $555,000 of discount accretion and recovery of interest of $610,000. The recovery of interest positively impacted the average loan yield by 11 basis points. Interest income on loans for the six months ended June 30, 2026 and 2025, included $355,000 and $271,000, respectively, in fees related to prepayment penalties.

Current wording

Interest income on loans for the nine months ended September 30, 2026 and 2025 included $136,000 and $579,000 in accretion of the net discount on acquired loans and revenue from PCD loans in excess of discounts, respectively. During the first quarter of 2026, one $4.0 million acquired CRE loan paid off, resulting in $555,000 of discount accretion and recovery of interest of $610,000. The recovery of interest positively impacted the average loan yield by four basis points. Interest income on loans for the nine months ended September 30, 2026 and 2025, included $439,000 and $391,000, respectively, in fees related to prepayment penalties.