Meridian Corp

Previous wording

The following items highlight the Corporation’s changes in its financial condition as of June 30, 2026 compared to December 31, 2025 and the results of operations for the three and six months ended June 30, 2026 compared to the same periods in 2025. More detailed information related to these highlights can be found in the sections that follow.

Current wording

The following items highlight the Corporation’s changes in its financial condition as of September 30, 2026 compared to December 31, 2025 and the results of operations for the three and nine months ended September 30, 2026 compared to the same periods in 2025. More detailed information related to these highlights can be found in the sections that follow.

Previous wording

•Total assets increased $31.2 million, or 1.2%, to $2.6 billion as of June 30, 2026.

Current wording

•Total assets increased $9.6 million, or 0.4%, to $2.6 billion as of September 30, 2026.

Previous wording

•Mortgage loans held for sale increased $21.1 million, or 62.6%, to $54.9 million as of June 30, 2026.

Current wording

•Mortgage loans held for sale increased $8.3 million, or 24.6%, to $42.1 million as of September 30, 2026.

Previous wording

•Portfolio loans increased $7.9 million, or 0.4%, to $2.2 billion as of June 30, 2026.

Current wording

•Total deposits increased $8.8 million or 0.4% to $2.2 billion as of September 30, 2026.

Previous wording

•The Corporation earned net income of $7.8 million during the six months ended June 30, 2026 and returned $3.3 million of capital to Meridian shareholders during this period through a $0.14 dividend per share in each of the first two quarters of the year.

Current wording

•The Corporation earned net income of $13.0 million during the nine months ended September 30, 2026 and returned $5.0 million of capital to Meridian shareholders during this period through a $0.14 dividend per share in each of the first three quarters of the year.

Previous wording

•Net income was $5.8 million, or $0.48 per diluted share, up $215 thousand, or 3.8%, driven by higher net interest income and a lower level of provision for credit losses, partially offset by lower non-interest income, and higher non-interest expense.

Current wording

•Net income was $5.2 million, or $0.43 per diluted share, down $1.5 million, or 21.8%, driven by lower non-interest income and higher non-interest expense, partially offset by a lower provision for credit losses, and slightly higher net interest income.

Previous wording

•The return on average assets and return on average equity were 0.90% and 11.42%, respectively, for the second quarter 2026, compared to 0.90% and 12.68%, respectively, for the second quarter 2025.

Current wording

•The return on average assets and return on average equity were 0.80% and 9.97%, respectively, for the third quarter 2026, compared to 1.04% and 14.42%, respectively, for the third quarter 2025.

Previous wording

•The overall provision for credit losses decreased $835 thousand when comparing the second quarter 2026 to the second quarter 2025. The provision on funded loans decreased $840 thousand over the three month comparable period in 2025 driven largely by a decrease of $940 thousand in charge-offs over this period, combined with a lower level of loan growth as well.

Current wording

•The overall provision for credit losses decreased $1.7 million when comparing the third quarter 2026 to the third quarter 2025. The provision on funded loans decreased $1.7 million over the three month comparable period in 2025 driven by a combination of a lower level of loan growth, a reduction in specific reserves on non-performing loans, and a decrease in net charge-offs over this period.

Previous wording

•Non-interest expense increased $870 thousand, or 4.1%, to $22.2 million due to largely to an increase of $312 thousand in data processing and software expense, a $135 thousand increase in occupancy and equipment expense, combined with a $392 thousand increase in other non-interest expense.

Current wording

•Non-interest expense increased $1.5 million, or 6.9%, to $23.0 million due largely to an increase of $351 thousand in data processing and software expense, a $230 thousand increase in occupancy and equipment expense, combined with a $677 thousand increase in other non-interest expense, and a $180 thousand increase in professional fees.

Previous wording

Six Month Results of Operations - June 30, 2026 Compared to June 30, 2025

Current wording

Nine Month Results of Operations - September 30, 2026 Compared to September 30, 2025

Previous wording

•Net income was $7.8 million, or $0.64 per diluted share, down $178 thousand, or 2.2%, driven by an increase in the provision for credit losses, a decrease in non-interest income, and an increase in non-interest expense.

Current wording

•Net income was $13.0 million, or $1.07 per diluted share, down $1.6 million, or 11.1%, driven by a decrease in non-interest income, an increase in non-interest expense, partially offset by an increase in net interest income and a reduction in the provision for credit losses.

Previous wording

•The return on average assets and return on average equity were 0.61% and 7.75%, respectively, for the six months ended June 30, 2026, compared to 0.66% and 9.16%, respectively, for the six months ended June 30, 2025

Current wording

•The return on average assets and return on average equity were 0.68% and 8.51%, respectively, for the nine months ended September 30, 2026, compared to 0.79% and 10.98%, respectively, for the nine months ended September 30, 2025.

Previous wording

•Net interest margin increased to 3.75% from 3.50% due to the impact of a reduction in deposit and borrowing costs outpacing the decreased yield on interest earnings assets, mainly loans.

Current wording

•Net interest margin increased to 3.76% from 3.59% due to the impact of a reduction in deposit and borrowing costs outpacing the decreased yield on interest earnings assets, mainly loans.

Previous wording

•Non-interest income decreased $1.7 million, or 9.1%, to $16.9 million driven by a $2.0 million decrease in SBA loan income, and an overall $1.0 million negative impact of fair value changes related to mortgage banking activities. These changes were partially offset by a $1.5 million increase in mortgage banking income, and a $408 thousand increase in wealth management fee income.

Current wording

•Non-interest income decreased $4.9 million, or 17.3%, to $23.6 million driven by a $3.7 million decrease in SBA loan income, and an overall $1.8 million negative impact of fair value changes related to mortgage banking activities. These changes were partially offset by a $260 thousand increase in mortgage banking income, and a $675 thousand increase in wealth management fee income.

Previous wording

•Non-interest expense increased $2.3 million, or 5.7%, to $42.4 million due to an increase of $1.0 million in salaries and employee benefits, an increase of $806 thousand in data processing and software expense, combined with a $211 thousand increase in professional fees, and an increase of $354 thousand in other non-interest expense.

Current wording

•Non-interest expense increased $3.8 million, or 6.1%, to $65.4 million due to an increase of $1.0 million in salaries and employee benefits, an increase of $1.2 million in data processing and software expense, combined with a $391 thousand increase in professional fees, and an increase of $1.0 million in other non-interest expense.

Previous wording

Net interest income is an integral source of the Corporation’s revenue. The tables below present a summary for the three and six months ended June 30, 2026 and 2025, of the Corporation’s average balances and yields earned on its interest-earning assets and the rates paid on its interest-bearing liabilities. The net interest margin is the net interest income as a percentage of average interest-earning assets. The net interest spread is the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities. The difference between the net interest margin and the net interest spread is the result of net free funding sources such as non-interest bearing deposits and stockholders’ equity.

Current wording

Net interest income is an integral source of the Corporation’s revenue. The tables below present a summary for the three and nine months ended September 30, 2026 and 2025, of the Corporation’s average balances and yields earned on its interest-earning assets and the rates paid on its interest-bearing liabilities. The net interest margin is the net interest income as a percentage of average interest-earning assets. The net interest spread is the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities. The difference between the net interest margin and the net interest spread is the result of net free funding sources such as non-interest bearing deposits and stockholders’ equity.

Previous wording

The rate/volume analysis table below analyzes dollar changes in the components of interest income and interest expense as they relate to the change in balances (volume) and the change in interest rates (rate) of tax-equivalent net interest income for the three and six months ended June 30, 2026 as compared to the same periods in 2025, allocated by rate and volume. Changes in interest income and/or expense attributable to both rate and volume have been allocated proportionately based on the relationship of the absolute dollar amount of the change in each category.

Current wording

The rate/volume analysis table below analyzes dollar changes in the components of interest income and interest expense as they relate to the change in balances (volume) and the change in interest rates (rate) of tax-equivalent net interest income for the three and nine months ended September 30, 2026 as compared to the same periods in 2025, allocated by rate and volume. Changes in interest income and/or expense attributable to both rate and volume have been allocated proportionately based on the relationship of the absolute dollar amount of the change in each category.

Previous wording

For the three months ended June 30, 2026 as compared to the same period in 2025, tax-equivalent interest income decreased $430 thousand as favorable volume changes contributed $1.4 million to interest income, but this was offset by a $1.8 million unfavorable change in rates. The unfavorable change in rates led to a 32 basis point decline in the yield on loans held for investment, which had a $1.7 million unfavorable impact on interest income. Nearly half of this decline, $885 thousand or 14 bps, was due to the impact of interest reversal on loans that were placed on nonaccrual during the quarter. The loans held for investment average balances increased $67.5 million, leading to a favorable volume impact on interest income of $1.2 million, while the increase in loans held for sale average balances of $9.1 million had a small but favorable impact to interest income of $138 thousand. Growth in the loans held for investment portfolio was led by average balance increases in construction loans ($56.7 million), commercial real estate ($26.9 million), commercial loans ($26.9 million), and home equity loans ($13.9 million), partially offset by a decline in the average balance of residential real estate loans of ($21.1 million), and a decline of ($31.7 million) in the average balance of small business loans.

Current wording

For the three months ended September 30, 2026 as compared to the same period in 2025, tax-equivalent interest income decreased $1.7 million as favorable volume changes contributed $450 thousand to interest income, but this was offset by a $2.1 million unfavorable change in rates. The unfavorable change in rates led to a 36 basis point decline in the yield on loans held for investment, which had a $2.0 million unfavorable impact on interest income. This decline in rates was largely due to the 25 basis point decline in the prime interest rate over this period. The loans held for investment average balances increased $16.3 million, leading to a favorable volume impact on interest income of $301 thousand, while the increase in loans held for sale average balances of $7.4 million also had a small but favorable impact to interest income of $114 thousand. Growth in the loans held for investment portfolio was led by average balance increases in construction loans ($88.3 million), commercial real estate ($74.1 million), commercial loans ($31.6 million), and home equity loans ($25.3 million), partially offset by a decline in the average balance of residential real estate loans of ($27.6 million), and a decline of ($38.7 million) in the average balance of small business loans.

Previous wording

On the funding side, overall interest expense decreased $2.1 million, largely driven by the continued impact that the Fed's prior period rate hikes have had on the cost of deposits and borrowings. The cost of deposits was down across the board, leading to a $1.6 million decrease to interest expense. The cost of interest-bearing demand deposits, money market and savings accounts and time deposits decreased 30, 57, and 44 basis points, respectively, while the cost of borrowings decreased 23 basis points. Interest expense was down overall due to these rate changes, an increase in average balances had an unfavorable impact of $451 thousand on interest expense. Money market/savings accounts were the largest drivers of the volume increase as average balances on such accounts increased $71.3 million, time deposit average balances increased $30.1 million, but the average balances on interest-bearing demand deposits decreased $10.6 million, and borrowings decreased $31.2 million on average.

Current wording

On the funding side, overall interest expense decreased $2.0 million. The cost of deposits was down across the board as the prime rate was 25 basis points higher in the prior year comparable period, leading to a $1.3 million decrease to interest expense. The cost of interest-bearing demand deposits, money market and savings accounts and time deposits decreased 4, 52, and 24 basis points, respectively, while the cost of borrowings decreased 14 basis points. Interest expense was down overall due to these rate changes, and an increase in average balances had a favorable impact of $94 thousand on interest expense. Money market/savings accounts were the largest drivers of the volume increase as average balances on such accounts increased $26.2 million, time deposit average balances increased $34.3 million, but the average balances on interest-bearing demand deposits decreased $15.2 million, and borrowings decreased $46.5 million on average.

Previous wording

Overall, the $1.6 million increase in net interest income over this period was attributable largely to rate changes as unfavorable rate changes in interest-earning assets were offset by favorable rate changes on interest-bearing liabilities.

Current wording

Overall, the $286 thousand increase in net interest income over this period was attributable largely to the drop in the prime rate, as the 34 basis point decline in the yield on interest-earning assets was offset by a 37 basis point drop in the cost of interest-bearing liabilities.

Previous wording

For the six months ended June 30, 2026 as compared to the same period in 2025, tax-equivalent interest income increased $1.1 million as favorable volume changes contributed $3.8 million to interest income, but this was partially offset by a $2.7 million unfavorable change in rates. The loans held for investment average balances increased $101.7 million, leading to a favorable volume impact on interest income of $3.6 million, while the increase in loans held for sale average balances of $6.1 million had a favorable impact to interest income of $184 thousand. Growth in the loans held for investment portfolio was led by average balance increases in construction loans ($24.7 million), commercial real estate ($11.9 million), commercial loans ($8.8 million), residential real estate ($4.2 million), and home equity loans ($4.8 million). The unfavorable change in rates led to decreased yields on loans held for sale (down 42 basis points) and loans held for investment (down 24 basis points) that unfavorably impact interest income by $2.5 million, overall.

Current wording

For the nine months ended September 30, 2026 as compared to the same period in 2025, tax-equivalent interest income decreased $583 thousand as favorable volume changes contributed $4.3 million to interest income, but this was offset by a $4.9 million unfavorable change in rates as the prime rate was 25 basis points higher as of September 30, 2025. The loans held for investment average balances increased $72.9 million, leading to a favorable volume impact on interest income of $3.9 million, while the increase in loans held for sale average balances of $6.6 million had a favorable impact to interest income of $299 thousand. Growth in the loans held for investment portfolio was led by average balance increases in construction loans ($58.7 million), commercial real estate ($31.7 million), commercial loans ($21.3 million), and home equity loans ($13.7 million). The unfavorable change in rates led to decreased yields on loans held for sale (down 37 basis points) and loans held for investment (down 28 basis points) that unfavorably impact interest income by $4.6 million, overall.

Previous wording

On the funding side, overall interest expense decreased $3.9 million. Interest expense on deposits decreased $3.2 million as the cost of all deposit types decreased. The cost of interest-bearing demand deposits, money market and savings accounts and time deposits decreased 38 basis points, 61 basis points and 49 basis points, respectively, while the cost of borrowings decreased by 19 basis points as well. From a volume perspective, money market/savings account average balances increased $88.2 million, while time deposit average balances increased $28.1 million, and the average balance on interest-bearing demand deposits decreased $6.2 million, and borrowings decreased $21.5 million on average.

Current wording

On the funding side, overall interest expense decreased $5.9 million. Interest expense on deposits decreased $4.5 million as the cost of all deposit types decreased. The cost of interest-bearing demand deposits, money market and savings accounts and time deposits decreased 26 basis points, 58 basis points and 41 basis points, respectively, while the cost of borrowings decreased by 17 basis points as well. From a volume perspective, money market/savings account average balances increased $67.3 million, while time deposit average balances increased $30.2 million, and the average balance on interest-bearing demand deposits decreased $9.3 million, and borrowings decreased $29.9 million on average.

Previous wording

Overall, the $5.1 million increase in net interest income over this period was driven by rate changes as the drop in cost of interest bearing liabilities outpaced the decrease in the yield on interest earning assets.

Current wording

Overall, the $5.3 million increase in net interest income over this period was driven largely by the drop in the prime rate, as the 26 basis point decline in the yield on interest-earning assets was offset by a 49 basis point drop in the cost of interest-bearing liabilities.

Previous wording

The total provision for credit losses decreased $835 thousand on a net basis for the three months ended June 30, 2026, compared to the three months ended June 30, 2025. The provision on funded loans decreased $840 thousand over the three month comparable period in 2025 driven largely by a decrease of $940 thousand in charge-offs over this period, combined with a lower level of loan growth as well. There was a $175 thousand provision on unfunded loan commitments for the three months ended June 30, 2026, while for the three months June 30, 2025 there was a $170 thousand provision on unfunded loan commitments.

Current wording

The total provision for credit losses decreased $1.7 million on a net basis for the three months ended September 30, 2026, compared to the three months ended September 30, 2025. The provision on funded loans decreased $1.7 million over the three month comparable period in 2025 driven by a combination of a lower level of loan growth, a reduction in specific reserves on non-performing loans, and a decrease in net charge-offs over this period. There was a $5 thousand provision on unfunded loan commitments for the three months ended September 30, 2026, while for the three months ended September 30, 2025 there was zero provision on unfunded loan commitments.

Previous wording

The total provision for credit losses increased $1.4 million on a net basis for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. The provision on funded loans increased $1.4 million over the six month comparable period in 2025 as there was an increase of $4.2 million in charge-offs over this period, with $3.9 million of the increase in charge-offs coming from a loan participated to us by another financial institution that became non-performing in the first quarter of 2026. The provision increase was also partially due to providing for loan growth over the six month comparable periods and an increase in certain loss factors that are part of the ACL calculation. There was a $230 thousand provision on unfunded loan commitments for the six months ended June 30, 2026, while for the six months June 30, 2025 there was an unfunded provision of $170 thousand.

Current wording

The total provision for credit losses decreased $274 thousand on a net basis for the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025. The provision on funded loans decreased $339 thousand over the nine month comparable period in 2025 despite an increase of $4.7 million in charge-offs over this period, with $3.9 million of the increase in charge-offs coming from a loan participated to us by another financial institution that became non-performing in the first quarter of 2026. The decrease in provision for credit losses was due to slightly negative portfolio loan growth for the nine months ended September 30, 2026, compared to loan growth for the nine months September 30, 2025 amounting to 6.6%, combined with an improvement in certain macro-economic factors in the underlying forecast models utilized in the ACL calculations. There was a $235 thousand provision on unfunded loan commitments for the nine months ended September 30, 2026, while for the nine months September 30, 2025 there was an unfunded provision of $170 thousand.

Previous wording

Total non-interest income decreased $1.7 million, despite a $1.5 million increase in mortgage banking over the six month comparable period. While there was with a 6 basis point decrease in the sales margin, the volume of residential mortgage loans sold increased by $54.3 million, or 15%, over the six month comparable period. Wealth management income improved $408 thousand, or 13.5%, as the amount of assets under management as of June 30, 2026 was up 9.2% since December 31, 2025. SBA loan income decreased $2.0 million over this period as the volume of SBA loans sold for the six months ended June 30, 2026 declined $33.1 million, or 64.0%, compared to the six months ended June 30, 2025, while the gross margin on sale was 8.1% for the six months ended June 30, 2026 compared to 6.8% for the six months ended June 30, 2025.

Current wording

SBA loan income decreased $3.7 million over this period as the volume of SBA loans sold for the nine months ended September 30, 2026 was lower by $56.8 million, compared to the nine months ended September 30, 2025, while the gross margin on sale was 8.1% for the nine months ended September 30, 2026 compared to 7.0% for the nine months ended September 30, 2025.

Previous wording

Included in the six months ended June 30, 2025 was the sale of $979 thousand in MSRs that resulted in a net gain on sale of $415 thousand, compared to a net loss on sale of MSRs of $159 thousand was recorded during the six months ended June 30, 2026.

Current wording

Included in the nine months ended September 30, 2025 was the sale of $979 thousand in MSRs that resulted in a net gain on sale of $415 thousand, compared to a net loss on sale of MSRs of $159 thousand was recorded during the nine months ended September 30, 2026.

Previous wording

Total non-interest expense increased $870 thousand, or 4.1%, as the result of increases in occupancy and equipment expense, data processing and software expense, and other non-interest expense. Occupancy and equipment expenses were up $135 thousand related to the opening of Meridian's first full-service branch in Bonita Springs, Florida which occurred late in 2025. Data processing and software expense increased $312 thousand over the three month comparable period as Meridian invests in technology at the customer and employee level to improve to continuously improve on the efficiency and security of the systems we use, combined with an increase in customer transaction volume. Other expense increased $392 thousand mainly due to an increase in OREO expenses and non-salary employee expenses in the current quarter.

Current wording

Total non-interest expense increased $1.5 million, or 6.9%, as the result of increases in occupancy and equipment expense, professional fees, data processing and software expense, and other non-interest expense. Occupancy and equipment expenses were up $230 thousand related to the opening of Meridian's first full-service branch in Bonita Springs, Florida which occurred late in 2025. Professional fees increased period over period due to the increase in fees related to non-performing loans and costs incurred related to the solar tax credit program entered into during 2026 that had a positive impact on income tax expense. Data processing and software expense increased $351 thousand over the three month comparable period as Meridian invests in technology at the customer and employee level to continuously improve on the efficiency and security of the systems we use, combined with an increase in customer transaction volume. Other expense increased $677 thousand mainly due to an increase in OREO expenses and non-salary employee expenses in the current quarter.

Previous wording

Total non-interest expense increased $2.3 million, or 5.7%, largely attributable to increases in salaries and employee benefits, professional fees, data processing and software expenses, as well as other non-interest expense. Salaries and employee benefits increased $1.0 million due largely to overall employee merit, benefit, and tax related increases for existing employees, as well as an increase of nearly 14 full-time equivalent employees, combined with an increase in mortgage segment related commissions and other benefits. The $211 thousand increase in professional fees was due to expenses related to non-performing loans. Other expense increased $354 thousand mainly due to an increase in OREO expenses and non-salary employee expenses in the current year-to-date period, compared to the prior year period.

Current wording

Total non-interest expense increased $3.8 million, or 6.1%, largely attributable to increases in salaries and employee benefits, professional fees, data processing and software expenses, as well as other non-interest expense. Salaries and employee benefits increased $1.0 million due largely to overall employee merit, benefit, and tax related increases for existing employees, as well as an increase of nearly 9 full-time equivalent employees, combined with an increase in mortgage segment related commissions and other benefits. The $391 thousand increase in professional fees was due to expenses related to non-performing loans. Data processing and software expense increased $1.2 million over the nine month comparable period due to the year-to-date impact of Meridian's continued investment in technology at the customer and employee level, combined with an increase in customer transaction volume discussed above in the three month comparison section. Other expense increased $1.0 million mainly due to an increase in OREO expenses and non-salary employee expenses in the current year-to-date period, compared to the prior year period.

Previous wording

As of June 30, 2026, total assets were $2.6 billion which increased $31.2 million, or 1.2%, from December 31, 2025. This increase in assets was due primarily to loan portfolio growth, as detailed in the following table:

Current wording

As of September 30, 2026, total assets were $2.6 billion which increased $9.6 million, or 0.4%, from December 31, 2025. This increase in assets was driven primarily by a $10.1 million increase in securities available-for-sale, an increase of $10.1 million in total loans held for sale, partially offset by the decrease in portfolio loans, as detailed in the following table:

Previous wording

As of June 30, 2026, included within the commercial real estate loans total of $911.7 million was $286 million of owner-occupied commercial loans, as well as $102.0 million of multi-family loans. Nearly all of the multi-family real estate loans are on properties located in Philadelphia and surrounding counties we service.

Current wording

As of September 30, 2026, included within the commercial real estate loans total of $897.8 million was $280 million of owner-occupied commercial loans, as well as $98.9 million of multi-family loans. Nearly all of the multi-family real estate loans are on properties located in Philadelphia and surrounding counties we service.

Previous wording

Meridian's deposit base is comprised of business deposits, 50%, with consumer deposits amounting to 15% at June 30, 2026. Municipal deposits at 12% and brokered deposits at 23% provide growth funding. Historically, business deposits lag loan fundings. A typical business relationship maintains operating accounts, investment accounts or sweep accounts and business owners may also have personal savings or wealth accounts. Deposit balances in business accounts have a tendency to be higher on average than consumer accounts. At June 30, 2026, 65% of business accounts and 87% of consumer accounts were fully insured by the FDIC. The municipal deposits are 100% collateralized and brokered deposits are 100% FDIC insured. The level of uninsured deposits for the entire deposit base was 20% at June 30, 2026.

Current wording

Meridian's deposit base is comprised of business deposits, 53%, with consumer deposits amounting to 16% at September 30, 2026. Municipal deposits at 9% and brokered deposits at 22% provide growth funding. Historically, business deposits lag loan fundings. A typical business relationship maintains operating accounts, investment accounts or sweep accounts and business owners may also have personal savings or wealth accounts. Deposit balances in business accounts have a tendency to be higher on average than consumer accounts. At September 30, 2026, 64% of business accounts and 86% of consumer accounts were fully insured by the FDIC. The municipal deposits are 100% collateralized and brokered deposits are 100% FDIC insured. The level of uninsured deposits for the entire deposit base was 21% at September 30, 2026.

Previous wording

Consolidated stockholders’ equity of the Corporation was $204.8 million, or 7.9% of total assets as of June 30, 2026, as compared to $199.7 million, or 7.8% of total assets as of December 31, 2025. On July 30, 2026, the Board of Directors declared a quarterly cash dividend of $0.14 per common share payable August 17, 2026 to shareholders of record as of August 10, 2026.

Current wording

Consolidated stockholders’ equity of the Corporation was $203.6 million, or 7.9% of total assets as of September 30, 2026, as compared to $199.7 million, or 7.8% of total assets as of December 31, 2025. On October 29, 2026, the Board of Directors declared a quarterly cash dividend of $0.14 per common share payable November 16, 2026 to shareholders of record as of November 9, 2026.

Previous wording

Under the Community Bank Leverage Ratio framework, a community banking organization that is less than $10 billion in total consolidated assets, and has limited amounts of certain assets and off-balance sheet exposures, and a CBLR greater than 9% can elect to report a single regulatory capital ratio. The Corporation has elected to be measured under this framework for Bank capital adequacy and had ratios of 9.72% and 9.50% at June 30, 2026 and December 31, 2025, respectively. The Corporation is exempt from CBLR.

Current wording

Under the Community Bank Leverage Ratio framework, as revised by bank regulators on July 1, 2026, a community banking organization that is less than $10 billion in total consolidated assets, and has limited amounts of certain assets and off-balance sheet exposures, and a CBLR greater than 8% can elect to report a single regulatory capital ratio. The Corporation has elected to be measured under this framework for Bank capital adequacy and had ratios of 9.93% and 9.50% at September 30, 2026 and December 31, 2025, respectively. The Corporation is exempt from CBLR.

Previous wording

The ratio of non-performing assets to total assets was 3.40% as of June 30, 2026, compared to 2.38% reported as of December 31, 2025. Total non-performing loans of $82.1 million as of June 30, 2026, increased $27.0 million from $55.1 million as of December 31, 2025, with the largest increases coming from land development loans ($21.7 million) and commercial mortgage loans ($9.8 million) that were downgraded during the current quarter, partially offset by payoffs of $3.4 million of several CRE & SBA loans combined. The downgraded land development loan relationships were all well collateralized and therefore did not require any specific reserve as of June 30, 2026. Of the increase in commercial mortgage non-performing loans, $2.9 million came from a purchased participation loan that is secured by a first lien on the leasehold interests of Class A office property with multiple buildings and tenants where an April 2026 appraisal, representative of conditions existing as of March 31, 2026, showed a significantly lower value than the original appraisal at the time of our participation, leading to a charge-off at March 31, 2026. The remaining increase in commercial mortgage non-performing loan relationships were well collateralized and therefore did not require any specific reserve as of June 30, 2026. SBA loans make up $24.6 million of total non-performing loans, with $11.9 million, or 48.4%, guaranteed by the SBA. The SBA portfolio was subject to the Fed's rapid rate increase with 49.7%, of total non-performing SBA loans having been originated in 2020-2021 when rates were lower by over 500 basis points.

Current wording

The ratio of non-performing assets to total assets was 3.23% as of September 30, 2026, compared to 2.38% reported as of December 31, 2025. Total non-performing loans of $78.3 million as of September 30, 2026, increased $23.3 million from $55.1 million as of December 31, 2025, with the largest increases coming from land development loans ($19.9 million) and commercial mortgage loans ($9.0 million), partially offset by the reclassification out of non-performing status and/or payoff of $3.8 million of several residential, CRE & SBA loans combined. The downgraded land development loan relationships were all well collateralized and therefore did not require any specific reserve as of September 30, 2026. Of the increase in commercial mortgage non-performing loans, $2.9 million came from a purchased participation loan secured by a first lien on leasehold interests in a multi-building Class A office property. An April 2026 appraisal, reflecting conditions as of March 31, 2026, indicated a significant decline in value from the original appraisal at the time of our participation and resulted in a charge-off as of March 31, 2026. The remaining increase in commercial mortgage non-performing loan relationships were well collateralized and therefore did not require any specific reserve as of September 30, 2026. SBA loans make up $23.6 million of total non-performing loans, with $13.6 million, or 57.6%, guaranteed by the SBA. The SBA portfolio was subject to the Fed's rapid rate increase with 48.1%, of total non-performing SBA loans having been originated in 2020-2021 when rates were lower by over 500 basis points.

Previous wording

As of June 30, 2026 there were specific reserves of $3.3 million against non-performing loans, a slight decrease from $3.4 million as of December 31, 2025.

Current wording

As of September 30, 2026 there were specific reserves of $3.0 million against non-performing loans, a decrease of $422 thousand, from $3.4 million as of December 31, 2025.

Previous wording

Meridian realized net charge-offs of 0.12% of total average loans for the three months ending June 30, 2026, a decrease from 0.17% reported for the same period in 2025. Net charge-offs for the quarter ended June 30, 2026 were $2.6 million, compared to net charge-offs of $3.6 million for the quarter ended June 30, 2025. Net charge-offs for the current quarter comprised of $3.0 million in total gross charge-offs, $2.2 million from commercial, industrial & other finance receivables, $414 thousand related to SBA loans, and $455 thousand in small equipment leases. There were $467 thousand in recoveries during the period related to commercial loans, finance receivables and leases.

Current wording

Meridian realized net charge-offs of 0.09% of total average loans for the three months ending September 30, 2026, on pace with the 0.09% reported for the same period in 2025. Net charge-offs for the quarters ended September 30, 2026 and September 30, 2025 were both $1.9 million, with the quarter ended September 30, 2026 being $10 thousand lower than the prior year comparable quarter. Net charge-offs for the current quarter comprised of $2.6 million in total gross charge-offs, $1.3 million from commercial, industrial & other finance receivables, $934 thousand related to SBA loans, and $413 thousand in small equipment leases. There were $739 thousand in recoveries during the period related to small business loans, finance receivables and leases.

Previous wording

The ratio of allowance for credit losses to total loans and other finance receivables, excluding loans at fair value (a non-GAAP measure, see reconciliation in the Non-GAAP Financial Measures), was 0.99% as of June 30, 2026 compared to 1.00% as of December 31, 2025. The level of provision for credit losses in the first six months of 2026, combined with lower loan growth, helped to maintain the allowance coverage level.

Current wording

The ratio of allowance for credit losses to total loans and other finance receivables, excluding loans at fair value (a non-GAAP measure, see reconciliation in the Non-GAAP Financial Measures), was 0.96% as of September 30, 2026 compared to 1.00% as of December 31, 2025. The level of provision for credit losses in the first nine months of 2026, combined with lower loan growth and a lower level of specifically reserved loans, helped to drive the allowance coverage level slightly lower.

Previous wording

(1) Included in non-performing small business loans as of June 30, 2026 and December 31, 2025, respectively, are $11.9 million and $13.2 million in SBA guarantees.

Current wording

(1) Included in non-performing small business loans as of September 30, 2026 and December 31, 2025, respectively, are $13.6 million and $13.2 million in SBA guarantees.

Previous wording

(2) Subsequent to June 30, 2026, a property in OREO valued at $719 thousand sold for a recorded gain of $218 thousand.

Current wording

(3) In the quarter-ended September 30, 2026, a property in OREO valued at $719 thousand sold for a recorded gain of $218 thousand.