Carter Bankshares, Inc.

Previous wording

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to assist readers in understanding Carter Bankshares, Inc.’s operations, financial condition, and current business environment. The MD&A is provided as a supplement to, and should be read in conjunction with, The Company’s Consolidated Financial Statements and the accompanying notes thereto contained in Item 1 of this Quarterly Report on Form 10-Q. Certain reclassifications have been made to prior periods to place them on a basis comparable with the current period presentation. The results of operations reported in the accompanying Consolidated Financial Statements are not necessarily indicative of results to be expected in future periods. The MD&A includes the following sections:

Current wording

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to assist readers in understanding Carter Bankshares, Inc.’s operations, financial condition, and current business environment. The MD&A is provided as a supplement to, and should be read in conjunction with, The Company’s Consolidated Financial Statements and the accompanying notes thereto contained in Item 1 of this Quarterly Report on Form 10-Q. The results of operations reported in the accompanying Consolidated Financial Statements are not necessarily indicative of results to be expected in future periods. The MD&A includes the following sections:

Previous wording

This section reviews the Company’s financial condition and results of operations and highlights material changes in its financial condition and results of operations as of and for the three-month periods ended March 31, 2026 and March 31, 2025. Certain prior period amounts have been reclassified to conform to the current period presentation. In addition, certain tables may include additional periods to illustrate trends within the Company’s consolidated financial statements and related disclosures.

Current wording

This section reviews the Company’s financial condition and results of operations and highlights material changes in its financial condition and results of operations as of and for the three and six month periods ended June 30, 2026 and June 30, 2025. Certain prior period amounts have been reclassified to conform to the current period presentation. In addition, certain tables may include additional periods to illustrate trends within the Company’s consolidated financial statements and related disclosures.

Previous wording

This Quarterly Report on Form 10-Q contains or incorporates certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may include statements relating to our financial condition, market conditions, results of operations, plans, including our strategic plan, brand strategy, and guiding principles and the anticipated results of the foregoing, objectives, outlook for earnings, revenues, expenses, capital and liquidity levels and ratios, asset levels, asset quality, loan pipeline and nonaccrual and nonperforming loans (“NPL”). Forward looking statements are typically identified by words or phrases such as “will likely result,” “expect,” “anticipate,” “estimate,” “forecast,” “project,” “intend,” “believe,” “assume,” “strategy,” “trend,” “plan,” “outlook,” “outcome,” “continue,” “remain,” “potential,” “opportunity,” “comfortable,” “current,” “position,” “maintain,” “sustain,” “seek,” “achieve” and variations of such words and similar expressions, or future or conditional verbs such as will, would, should, could or may.

Current wording

This Quarterly Report on Form 10-Q contains or incorporates certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may include statements relating to the financial consequences of the Loan Sale Transaction, Insurance Transaction and Portfolio Repositioning, including the expected enhancement of future earnings, asset yields, and net interest income from the Portfolio Repositioning, our expansion in the Carolinas and the anticipated results of such expansion, our financial condition, market conditions, results of operations, plans, including our strategic plan, brand strategy, and guiding principles and the anticipated results of the foregoing, objectives, outlook for earnings, revenues, expenses, capital and liquidity levels and ratios, asset levels, asset quality, loan pipeline and nonaccrual and nonperforming loans (“NPL”). Forward looking statements are typically identified by words or phrases such as “will likely result,” “expect,” “anticipate,” “estimate,” “forecast,” “project,” “intend,” “believe,” “assume,” “strategy,” “trend,” “plan,” “outlook,” “outcome,” “continue,” “remain,” “potential,” “opportunity,” “comfortable,” “current,” “position,” “maintain,” “sustain,” “seek,” “achieve” and variations of such words and similar expressions, or future or conditional verbs such as will, would, should, could or may.

Previous wording

•concentrations of loans secured by real estate, particularly commercial real estate (“CRE”) loans, and the potential impacts of changes in market conditions on the value of real estate collateral;

Current wording

•concentrations of loans secured by real estate, particularly commercial real estate loans, and the potential impacts of changes in market conditions on the value of real estate collateral;

Previous wording

•increased delinquency and foreclosure rates on CRE loans;

Current wording

•increased delinquency and foreclosure rates on commercial real estate loans;

Previous wording

•re-emergence of turbulence in significant portions of the global financial and real estate markets that could impact our performance, both directly, by affecting our revenues and the value of our assets and liabilities, and indirectly, by affecting the economy generally and access to capital in the amounts, at the times and on the terms required to support our future businesses.

Current wording

•turbulence in significant portions of the global financial and real estate markets that could impact our performance, both directly, by affecting our revenues and the value of our assets and liabilities, and indirectly, by affecting the economy generally and access to capital in the amounts, at the times and on the terms required to support our future businesses.

Previous wording

During 2025, the Company acquired two leased branch facilities, along with the associated deposits, located in Mooresville, North Carolina and Winston Salem, North Carolina, from First Reliance Bank (the “Branch Purchase”). In connection with the Branch Purchase, the Bank acquired $55.9 million in deposits, along with cash and premises and equipment associated with the branch locations, and welcomed ten associates to its team. No loans were acquired as part of the Branch Purchase. The Branch Purchase closed during the second quarter of 2025.

Current wording

During 2025, the Company acquired two leased branch facilities, along with the associated deposits, located in Mooresville, North Carolina and Winston Salem, North Carolina (the “Branch Purchase”). In connection with the Branch Purchase, the Bank acquired $55.9 million in deposits, along with cash and premises and equipment associated with the branch locations, and welcomed ten associates to its team. No loans were acquired as part of the Branch Purchase. The Branch Purchase closed during the second quarter of 2025.

Previous wording

On March 26, 2026, the Bank completed the sale (the “Transaction”) of all loans subsequently reduced to judgments related to various entities in which James C. Justice, II has an interest (such loans, subsequently reduced to judgments, the “Judgments”). The Transaction was completed as an absolute, “as-is, where-is” sale to an unaffiliated third party.

Current wording

On March 26, 2026, the Bank completed the Loan Sale Transaction of all loans subsequently reduced to judgments related to various entities in which James C. Justice, II has an interest (such loans, subsequently reduced to judgments, the “Judgments”). The Loan Sale Transaction was completed as an absolute, “as-is, where-is” sale to an unaffiliated third party.

Previous wording

The Company received consideration of $289.5 million in cash in the Transaction. Immediately prior to the Transaction, the Judgments had an outstanding aggregate principal amount of $209.5 million, all of the Judgments were nonperforming and on nonaccrual status, and the Company had recorded a specific reserve with respect to the Judgments of $18.0 million as of December 31, 2025. Management’s continued focus on the resolution of this relationship has improved overall asset quality, reduced credit concentration risk and helped to optimize capital and liquidity.

Current wording

The Company received consideration of $289.5 million in cash in the Loan Sale Transaction. Immediately prior to the Loan Sale Transaction, the Judgments had an outstanding aggregate principal amount of $209.5 million, all of the Judgments were nonperforming and on nonaccrual status, and the Company had recorded a specific reserve with respect to the Judgments of $18.0 million as of December 31, 2025. Management’s continued focus on the resolution of this relationship has improved overall asset quality, reduced credit concentration risk and helped to optimize capital and liquidity.

Previous wording

•Received consideration of $289.5 million in cash in the Transaction during the first quarter of 2026;

Current wording

•Received consideration of $289.5 million in cash in the Loan Sale Transaction, during the first quarter of 2026;

Previous wording

•Recognized a net gain on the Transaction of $80.0 million, comprised of:

Current wording

•Recognized a net gain on the Loan Sale Transaction of $80.0 million, comprised of:

Previous wording

•The Transaction was accretive to diluted earnings per share by $3.50 for the first quarter of 2026; and

Current wording

•The Loan Sale Transaction was accretive to diluted earnings per share by $3.50 for the first quarter of 2026; and

Previous wording

•The Transaction increased book value per share by $3.49 for the first quarter of 2026.

Current wording

•The Loan Sale Transaction increased book value per share by $3.49 for the first quarter of 2026.

Previous wording

Highlights for the Three Months Ended March 31, 2026 compared to the Three Months Ended March 31, 2025.

Current wording

Highlights for the Three Months Ended June 30, 2026

Previous wording

•Total noninterest expense increased $3.0 million to $31.0 million compared to the same period in 2025; and

Current wording

•Total noninterest expense increased $0.7 million to $30.0 million compared to the same period in 2025; and

Previous wording

•Income tax provision increased $22.1 million to $24.3 million compared to $2.2 million for the same period in 2025.

Current wording

•Income tax provision increased $6.2 million to $8.3 million compared to $2.1 million for the same period in 2025.

Previous wording

•The available-for-sale securities portfolio decreased $29.5 million and is currently 13.8% of total assets compared to 14.3% of total assets;

Current wording

•The available-for-sale securities portfolio decreased $51.3 million and is currently 13.3% of total assets compared to 14.3% of total assets;

Previous wording

•The portfolio loans to deposit ratio was 88.0%, compared to 92.1%;

Current wording

•The portfolio loans to deposit ratio was 89.0%, compared to 92.1%;

Previous wording

•Nonperforming loans (“NPLs”) decreased significantly by $220.0 million to $24.0 million compared to $244.0 million due to the Transaction and NPLs to total portfolio loans were 0.64% compared to 6.29%;

Current wording

•Nonperforming loans (“NPLs”) decreased by $206.4 million to $37.6 million compared to $244.0 million due to the Loan Sale Transaction and NPLs to total portfolio loans were 1.01% compared to 6.29%;

Previous wording

•The allowance for credit losses to total portfolio loans was 1.41%, compared to 1.84%, primarily reflecting the reversal of specific reserves of $18.0 million related to the Judgments;

Current wording

•The allowance for credit losses to total portfolio loans was 1.48%, compared to 1.84%, primarily reflecting the reversal of specific reserves of $18.0 million related to the Judgments;

Previous wording

•Total deposits increased $24.4 million, or 2.3%, on an annualized basis, to $4.2 billion, compared to December 31, 2025; and

Current wording

•Total deposits decreased $13.3 million, or 0.64%, on an annualized basis, to $4.2 billion, compared to December 31, 2025; and

Previous wording

•FHLB borrowings decreased $178.5 million, reflecting the repayment of borrowings utilizing proceeds from the Transaction.

Current wording

•FHLB borrowings decreased $178.5 million, reflecting the repayment of borrowings utilizing proceeds from the Loan Sale Transaction.

Previous wording

The Company reported net income of$85.8 million, or $3.88 diluted earnings per share for thethree months ended March 31, 2026, compared to net income of$9.0 million, or $0.39 diluted earnings per share for thethree months ended March 31, 2025.

Current wording

The Company reported net income of$28.9 million, or $1.31 diluted earnings per share, and$114.7 million, or $5.18 diluted earnings per share for thethree and six months ended June 30, 2026, respectively, compared to net income of$8.5 million, or $0.37 diluted earnings per share, and$17.5 million, or $0.76 diluted earnings per share, for thethree and six months ended June 30, 2025, respectively.

Previous wording

2 Tax-exempt income is on an FTE basis using the statutory federal corporate income tax rate of 21 percent.

Current wording

2 Tax-exempt income is on an FTE basis using the statutory federal corporate income tax rate of 21%.

Previous wording

Total interest expense decreased $2.6 million, or 10.1%, to $23.3 million for the three months ended March 31, 2026, compared to $25.9 million for the same period in 2025. The average cost of total interest-bearing liabilities declined 41 basis points to 2.49%, primarily due to continued reductions in funding costs, as well as stabilization in deposit pricing, partially reflecting the broader interest rate environment.

Current wording

The increase was primarily attributable to higher average interest-earning assets, led by growth in the commercial real estate, commercial and industrial, construction, and residential mortgage loan portfolios, as well as a reduction in the average costs of interest-bearing liabilities. The average yield on total interest-earning assets increased 22 basis points to 5.23% from 5.01% primarily as a result of the redeployment of funds from the Loan Sale Transaction, while the average cost of total interest-bearing liabilities declined 37 basis points to 2.39% from 2.76%, primarily due to continued reductions in funding costs, as well as stabilization in deposit pricing, partially reflecting the broader interest rate environment, resulting in expansion of the net interest margin to 3.40%, compared to 2.82% for the second quarter of 2025.

Previous wording

Net interest income for the three months ended March 31, 2026 increased $5.8 million, or 19.2%, to $35.9 million compared to the same period in 2025. On an FTE basis (non-GAAP), net interest income increased $5.8 million to $36.1 million compared to the same period in 2025.

Current wording

Net interest income for the six months ended June 30, 2026 increased $13.4 million, or 21.4% to $75.9 million, compared to $62.5 million for the same period in 2025. On an FTE basis (non-GAAP), net interest income increased $13.4 million, or 21.4%, to $76.3 million, compared to $62.8 million for the same period in 2025.

Previous wording

The following table presents information regarding the recovery for credit losses and net (recoveries) / charge-offs for the periods presented:

Current wording

The following table presents information regarding the provision (recovery) for credit losses and net (recoveries) / charge-offs for the periods presented:

Previous wording

The recovery for credit losses in the first quarter of 2026 primarily reflects the release of previously established specific reserves of $18.0 million, as well as a $15.0 million net recovery associated with the Judgments, in each case related to the Transaction.

Current wording

During the three months ended June 30, 2026, the Company recorded a provision for credit losses of $2.0 million, compared to a recovery of $2.3 million for the same period in 2025. The provision for the quarter ended June 30, 2026 was primarily attributable to a commercial and industrial credit relationship consisting of three loans that transferred to NPL status during the quarter, resulting in the establishment of a $3.1 million specific reserve. This increase was partially offset by $0.7 million net recoveries received during the period. During the six months ended June 30, 2026, the Company recorded a recovery for credit losses of $31.9 million, compared to a recovery of $4.3 million for the same period in 2025. The recovery for credit losses during the six months ended June 30, 2026 primarily reflects the release of previously established specific reserves of $18.0 million, as well as a $15.0 million net recovery associated with the Judgments, in each case related to the Loan Sale Transaction. This recovery was offset by the previously mentioned $3.1 million specific reserve recorded in the second quarter. The recovery for credit losses in the first six months of 2025 was primarily driven by a decline in the Other segment reserve rate, specifically the Company’s former largest nonperforming credit relationship due to curtailment payments received during the period.

Previous wording

The Company also recorded a recovery for unfunded loan commitments of $0.2 million compared to $0.1 million for the same period in 2025. The increase from the prior year was primarily due to a reduction in unfunded loan commitments, which is reflective of the increase in construction loans in the loan composition.

Current wording

The Company also recorded a recovery for unfunded loan commitments of $0.6 million and $0.8 million for the three and six months ended June 30, 2026, respectively compared to $0.3 million and $0.4 million for the same periods in 2025, respectively. The increases from the three and six months ended June 30, 2025 were primarily due to a reduction in unfunded loan commitments, which is reflective of the increase in construction loans in the loan composition.

Previous wording

As a result of these factors, the Company recorded a net benefit to the recovery for credit losses, contributing to a decline in the allowance for credit losses to total portfolio loans declined to 1.41% during the quarter. The net benefit to the recovery for credit losses was a significant driver of earnings for the first quarter of 2026.

Current wording

As a result of these factors, the allowance for credit losses to total portfolio loans declined to 1.48% at June 30, 2026 from 1.90% at June 30, 2025. While the Company recorded a provision for credit losses during the second quarter of 2026, the year-to-date recovery for credit losses, primarily driven by the first quarter of 2026 Loan Sale Transaction and related reserve release and recovery discussed above, remained a significant contributor to earnings for the six months ended June 30, 2026.

Previous wording

Net recoveries totaled $14.9 million for the three months ended March 31, 2026, compared to net charge-offs of $0.1 million for the same period in 2025. Net recoveries (annualized) to average portfolio loans, were 1.55% for the three months ended March 31, 2026 compared to net charge-offs of 0.01% for the same period in 2025.

Current wording

Net recoveries totaled $0.7 million and $15.6 million for the three and six months ended June 30, 2026, respectively, compared to net charge-offs of $0.2 million for both the three and six months ended June 30, 2025. Net recoveries (annualized) to average portfolio loans, were 0.07% and 0.82% for the three and six months ended June 30, 2026, respectively, compared to net charge-offs of 0.02% and 0.01% for the same periods in 2025, respectively.

Previous wording

The increase in salaries and employee benefits was primarily attributable to higher incentive compensation, increased medical costs and annual merit increases, partially offset by higher deferred costs on loan originations. Other noninterest expense increased primarily due to a $0.6 million write-down on one closed office that was transferred to OREO during the first quarter of 2026. Data processing expense increased due to inflationary cost pressures and higher costs associated with new and existing service agreements implemented in early 2026. The increase in occupancy expense was primarily attributable to maintenance contracts entered into during the first quarter of 2026 and related infrastructure investments. Professional and legal fees increased primarily due to costs associated with the Transaction and higher expenses related to the management of special assets.

Current wording

Consistent with the quarterly discussion above, other noninterest expense increased primarily due to the OREO property write-down and the write-down on the closed corporate office building, while data processing expense increased due to new and expanded service agreements implemented in early 2026. Occupancy expense increased primarily as a result of higher costs associated with service agreements, software licenses, maintenance contracts, and related infrastructure investments. Salaries and employee benefits increased primarily due to higher incentive compensation, increased medical benefit costs and annual merit increases, partially offset by higher deferred costs on loan originations. Professional and legal fees increased primarily due to costs associated with the Loan Sale Transaction and higher expenses related to the management of special assets. FDIC insurance expense declined as a result of the Company’s improved risk profile following the Loan Sale Transaction completed during the first quarter of 2026.

Previous wording

The effective tax rate was 22.1% for the three months ended March 31, 2026 compared to 19.6% for the same period in 2025. The current period effective tax rate exceeded the statutory federal rate of 21% primarily due to the impact of higher pre-tax income attributable to the Transaction and the expiration of tax credits associated with historic tax credit investments. In contrast, the prior year period included a $1.9 million tax-free BOLI death benefit, which reduced the annual effective tax rate in that period.

Current wording

The effective income tax rate was 22.4% and 22.1% for the three and six months ended June 30, 2026, respectively compared to 19.9% and 19.8% for the same periods in 2025. The effective tax rates for 2026 exceeded the statutory federal tax rate of 21.0%, primarily due to state income taxes and the expiration of certain tax credits associated with historic tax credit investments. These items were partially offset by the tax benefits associated with tax-exempt interest income, BOLI income and rehabilitation tax credits. In contrast, the effective tax rate for the prior-year periods benefited from the $1.9 million tax-exempt BOLI death benefit recognized during the first quarter of 2025.

Previous wording

At March 31, 2026, approximately 82.8% of total deposits were insured under FDIC insurance coverage limits, while approximately 17.2% of total deposits were uninsured. At December 31, 2025, approximately 81.3% of total deposits were insured under FDIC insurance coverage limits, while approximately 18.7% of total deposits were uninsured.

Current wording

At June 30, 2026, approximately 82.3% of total deposits were insured under FDIC insurance coverage limits, while approximately 17.7% of total deposits were uninsured. At December 31, 2025, approximately 81.3% of total deposits were insured under FDIC insurance coverage limits, while approximately 18.7% of total deposits were uninsured.

Previous wording

As of March 31, 2026, approximately 34.2% of the securities portfolio consisted of variable rate securities, with approximately 100.0% of the portfolio repricing at least once within the next 12 months. Total gross unrealized gains in the available-for-sale portfolio were $0.2 million at March 31, 2026, offset by $55.0 million of gross unrealized losses, compared to gross unrealized gains of $0.4 million and gross unrealized losses of $54.2 million at December 31, 2025.

Current wording

Total gross unrealized gains in the available-for-sale portfolio were $1.6 million at June 30, 2026, offset by $43.6 million of gross unrealized losses, compared to gross unrealized gains of $0.4 million and gross unrealized losses of $54.2 million at December 31, 2025. Although increases in intermediate and long-term market interest rates during the six months ended June 30, 2026 would have increased unrealized losses on the remaining portfolio, gross unrealized losses declined overall as a result of the Company’s strategic Portfolio Repositioning, which realized a portion of previously existing unrealized losses through the sale of securities.

Previous wording

Management believes that unrealized losses on debt securities at March 31, 2026 are temporary and primarily attributable to changes in market interest rates since the time of purchase rather than deterioration in credit quality. Approximately 43.5% of the securities portfolio is comprised of obligations issued by U.S. government sponsored entities that carry implicit government guarantees. States and political subdivision securities comprise 35.2% and are largely general obligations and essential purpose revenue bonds, which have historically performed well across economic cycles and are predominantly rated AA and AAA. The Company has the ability and intent to hold these securities to maturity and expects to recover the full amortized cost of these investments. The Company may occasionally sell securities to take advantage of market opportunities or as part of a strategic initiative.

Current wording

Management believes the unrealized losses on debt securities at June 30, 2026 are temporary and primarily attributable to changes in market interest rates since the securities were purchased rather than deterioration in credit quality. Approximately 48.0% of the securities portfolio is comprised of obligations issued by U.S. government sponsored entities that carry implicit government guarantees. States and political subdivision securities represent 26.0% of the portfolio and consist primarily of general obligation and essential purpose revenue bonds, which have historically demonstrated strong credit performance and are predominantly rated AA and AAA. The Company has the ability and intent to hold these securities until recovery of their amortized cost basis through maturity or sale.

Previous wording

Unrealized losses were concentrated primarily in securities with intermediate and long-term maturities, whose market values are most sensitive to movements in the U.S. Treasury yield curve, particularly the five year and ten year maturities. During the three months ended March 31, 2026, intermediate term Treasury yields increased, contributing to an increase in unrealized losses. At March 31, 2026, the five and ten-year U.S. Treasury yields were 3.92% and 4.30%, respectively, compared to 3.73% and 4.18%, respectively, at December 31, 2025. The increase of approximately 19 basis points in the five year yield and 12 basis points in the ten year yield largely explains the slight increase in unrealized losses during the three months ended March 31, 2026, with longer duration securities, such as municipal bonds, experiencing the most pronounced valuation changes.

Current wording

Unrealized losses remained concentrated primarily in securities with intermediate and long-term maturities, whose market values are most sensitive to movements in the U.S. Treasury yield curve, particularly the five year and ten year maturities. During the six months ended June 30, 2026, intermediate-term Treasury yields increased, creating additional valuation pressure on the remaining securities portfolio. At June 30, 2026, the five and ten-year U.S. Treasury yields were 4.19% and 4.44%, respectively, compared to 3.73% and 4.18%, respectively, at December 31, 2025. The increase of approximately 46 basis points in the five year yield and 26 basis points in the ten year yield would generally be expected to increase unrealized losses, particularly for longer duration securities such as municipal bonds. However, the Company’s strategic Portfolio Repositioning during the period ended June 30, 2026 reduced the overall gross unrealized loss balance by realizing a portion of previously existing unrealized losses through the sale of selected securities.

Previous wording

Under Basel III capital rules, most banking organizations are permitted to make a one-time election to retain the existing regulatory capital treatment for accumulated other comprehensive loss. The Company elected to retain this treatment, under which accumulated comprehensive loss is excluded from regulatory capital. As a result, changes in unrealized gains and losses on available-for-sale securities do not affect regulatory capital levels, therefore reducing capital volatility associated with interest rate movements.

Current wording

Under Basel III capital rules, most banking organizations are permitted to make a one-time election to retain the existing regulatory capital treatment for accumulated other comprehensive loss. The Company elected to retain this treatment, under which accumulated other comprehensive loss is excluded from regulatory capital. As a result, changes in unrealized gains and losses on available-for-sale securities do not affect regulatory capital levels, therefore reducing capital volatility associated with interest rate movements.

Previous wording

Total portfolio loans decreased $151.1 million to $3.7 billion at March 31, 2026, compared to December 31, 2025 largely reflecting the Transaction, partially offset by net loan growth during the three months ended March 31, 2026 of $58.4 million.

Current wording

Total portfolio loans decreased $145.0 million to $3.7 billion at June 30, 2026, compared to December 31, 2025 largely reflecting the Loan Sale Transaction completed during the first quarter of 2026, partially offset by net loan growth during the first half of the year.

Previous wording

The Company actively monitors the loan portfolio in light of changing market conditions, borrower performance, and the interest rate environment. At March 31, 2026, the loan portfolio consisted of 20.7% floating rates loans that reprice monthly, 38.2% variable rate loans that reprice at least once during the life of the loan, and 41.1% fixed rate loans.

Current wording

The Company actively monitors the loan portfolio in light of changing market conditions, borrower performance, and the interest rate environment. At June 30, 2026, the loan portfolio consisted of 21.0% floating rates loans that reprice monthly, 37.4% variable rate loans that reprice at least once during the life of the loan, and 41.6% fixed rate loans.