ALLOWANCE FOR CREDIT LOSSES ON LOANS AND LEASES

12 Months Ended

Dec. 31, 2025

ALLOWANCE FOR CREDIT LOSSES ON LOANS AND LEASES

The ACL is maintained for credit losses expected in the existing loan and lease portfolio and is presented as a reserve against loans and leases on the Consolidated Balance Sheets. Loan and lease losses are charged off against the ACL, with recoveries of amounts previously charged off credited to the ACL. Provisions for credit losses are charged to operations based on management’s periodic evaluation of the appropriate level of the ACL.

Following is a summary of changes in the ACL, by loan and lease class:

TABLE 6.1


(in millions)	Balance at Beginning of Year		Charge- Offs		Recoveries		Net Charge- Offs		Provision for Credit Losses		Balance at End of Year
Year Ended December 31, 2025
Commercial real estate	$	166.9	$	(30.0)	$	1.3	$	(28.7)	$	37.7	$	175.9
Commercial and industrial	85.6		(37.9)		8.1		(29.8)		43.1		98.9
Commercial leases	22.9		(0.2)		—		(0.2)		3.5		26.2
Other	4.3		(4.7)		1.0		(3.7)		3.8		4.4
Total commercial loans and leases	279.7		(72.8)		10.4		(62.4)		88.1		305.4
Direct installment	29.1		(0.9)		0.7		(0.2)		(3.2)		25.7
Residential mortgages	95.9		(2.4)		0.5		(1.9)		(1.6)		92.4
Indirect installment	9.5		(7.6)		2.2		(5.4)		4.9		9.0
Consumer lines of credit	8.6		(1.0)		0.4		(0.6)		(1.0)		7.0
Total consumer loans	143.1		(11.9)		3.8		(8.1)		(0.9)		134.1
Total allowance for credit losses on loans and leases	422.8		(84.7)		14.2		(70.5)		87.2		439.5
Allowance for unfunded loan commitments	21.4		—		—		—		(1.3)		20.1
Total allowance for credit losses on loans and leases and allowance for unfunded loan commitments	$	444.2	$	(84.7)	$	14.2	$	(70.5)	$	85.9	$	459.6


(in millions)	Balance at Beginning of Year		Charge- Offs		Recoveries		Net Charge- Offs		Provision for Credit Losses		Balance at End of Year
Year Ended December 31, 2024
Commercial real estate	$	166.6	$	(38.6)	$	2.5	$	(36.1)	$	36.4	$	166.9
Commercial and industrial	87.8		(20.9)		9.3		(11.6)		9.4		85.6
Commercial leases	21.2		(0.3)		0.1		(0.2)		1.9		22.9
Other	3.7		(4.2)		1.4		(2.8)		3.4		4.3
Total commercial loans and leases	279.3		(64.0)		13.3		(50.7)		51.1		279.7
Direct installment	33.8		(1.8)		1.1		(0.7)		(4.0)		29.1
Residential mortgages	70.5		(2.6)		1.2		(1.4)		26.8		95.9
Indirect installment	12.8		(11.8)		2.6		(9.2)		5.9		9.5
Consumer lines of credit	9.2		(1.6)		0.9		(0.7)		0.1		8.6
Total consumer loans	126.3		(17.8)		5.8		(12.0)		28.8		143.1
Total allowance for credit losses on loans and leases	405.6		(81.8)		19.1		(62.7)		79.9		422.8
Allowance for unfunded loan commitments	21.5		—		—		—		(0.1)		21.4
Total allowance for credit losses on loans and leases and allowance for unfunded loan commitments	$	427.1	$	(81.8)	$	19.1	$	(62.7)	$	79.8	$	444.2


(in millions)	Balance at Beginning of Period		Charge- Offs		Recoveries		Net Charge- Offs		Provision for Credit Losses		Balance at End of Period
Year Ended December 31, 2023
Commercial real estate	$	162.1	$	(12.4)	$	4.4	$	(8.0)	$	12.5	$	166.6
Commercial and industrial	102.1		(51.2)		3.8		(47.4)		33.1		87.8
Commercial leases	13.5		—		—		—		7.7		21.2
Other	4.0		(4.5)		1.0		(3.5)		3.2		3.7
Total commercial loans and leases	281.7		(68.1)		9.2		(58.9)		56.5		279.3
Direct installment	35.9		(0.6)		0.6		—		(2.1)		33.8
Residential mortgages	55.5		(0.7)		0.5		(0.2)		15.2		70.5
Indirect installment	17.3		(10.7)		2.3		(8.4)		3.9		12.8
Consumer lines of credit	11.3		(1.0)		0.8		(0.2)		(1.9)		9.2
Total consumer loans	120.0		(13.0)		4.2		(8.8)		15.1		126.3
Total allowance for credit losses on loans and leases	401.7		(81.1)		13.4		(67.7)		71.6		405.6
Allowance for unfunded loan commitments	21.4		—		—		—		0.1		21.5
Total allowance for credit losses on loans and leases and allowance for unfunded loan commitments	$	423.1	$	(81.1)	$	13.4	$	(67.7)	$	71.7	$	427.1

Following is a summary of changes in the AULC by portfolio segment:

TABLE 6.2


Year Ended December 31	2025		2024		2023
(in millions)
Balance at beginning of period	$	21.4	$	21.5	$	21.4
Provision for unfunded loan commitments and letters of credit:
Commercial portfolio	(1.1)		0.1		0.3
Consumer portfolio	(0.2)		(0.2)		(0.2)






Balance at end of period	$	20.1	$	21.4	$	21.5

The model used to calculate the ACL is dependent on the portfolio composition and credit quality, as well as historical experience, current conditions and forecasts of economic conditions and interest rates. Specifically, the following considerations are incorporated into the ACL calculation:

•a third-party macroeconomic forecast scenario;

•a 24-month R&S forecast period for macroeconomic factors with a reversion to the historical mean on a straight-line basis over a 12-month period; and

•the historical through-the-cycle mean was calculated using an expanded period to include a prior recessionary period.

At December 31, 2025 and 2024, we utilized a third-party consensus macroeconomic forecast reflecting the current and projected macroeconomic environment. For our ACL calculation at December 31, 2025, the macroeconomic variables that we utilized included, but were not limited to: (i) the purchase only Housing Price Index, which increases 4.3% over our R&S forecast period, (ii) a Commercial Real Estate Price Index, which decreases 0.5% over our R&S forecast period, (iii) S&P Volatility, which decreases 2.2% in 2026 and 7.9% in 2027 and (iv) personal and business bankruptcies, which increase steadily over the R&S forecast period but average below the historical through the cycle period. While we have not changed our ACL modeling methodology, we continually assess our key macroeconomic variables and their correlation to our historical and expected portfolio performance. During the quarter ended September 30, 2025, we changed certain macroeconomic variables used for ACL modeling purposes as we believe the new variables better correlate to our historical performance over the economic cycles. Macroeconomic variables that we utilized for our ACL calculation as of December 31, 2024 included, but were not limited to: (i) the purchase only Housing Price Index, which increases 7.4% over our R&S forecast period, (ii) a Commercial Real Estate Price Index, which increases 3.9% over our R&S forecast period, (iii) S&P Volatility, which increases

34.9% in 2025 and 2.5% in 2026 and (iv) personal and business bankruptcies, which increase steadily over the R&S forecast period but average below the historical through the cycle period.

The ACL on loans and leases of $439.5 million at December 31, 2025 increased $16.7 million, or 4.0%, from December 31, 2024. Our ending ACL coverage ratio was 1.26% at December 31, 2025 and 1.25% at December 31, 2024. Total provision for credit losses for the year ended December 31, 2025 was $86.0 million, compared to $79.8 million in 2024. Net charge-offs were $70.5 million during 2025, compared to $62.7 million during 2024.