Loans and Allowance for Credit Losses

12 Months Ended

Dec. 31, 2025

Note 4. Loans and Allowance for Credit Losses

The Company generally makes loans in its market areas of southern and central Mississippi; southern and central Alabama; northwest, central and southern Louisiana; the northern, central and panhandle regions of Florida; certain areas of east and northeast Texas; and the metropolitan areas of Nashville, Tennessee and Atlanta, Georgia. In addition, and to a lesser degree, the Bank makes loans both regionally and nationally, generally through its specialty lines of business, including the equipment finance, commercial real estate and healthcare segments, often with sponsors in our market areas.

The following table presents loans at their amortized cost basis, by portfolio class at December 31, 2025 and December 31, 2024. The amortized cost basis is net of unearned income and excludes accrued interest totaling $105.1 million and $109.8 million at

December 31, 2025 and 2024, respectively. Accrued interest is reflected in the accrued interest line item in the Consolidated Balance Sheets.


	December 31,
($ in thousands)	2025		2024
Commercial non-real estate	$	9,809,011	$	9,876,592
Commercial real estate - owner occupied		3,270,080		3,011,955
Total commercial and industrial		13,079,091		12,888,547
Commercial real estate - income producing		4,283,168		3,798,612
Construction and land development		1,239,086		1,281,115
Residential mortgages		4,016,917		3,961,328
Consumer		1,340,178		1,369,845
Total loans	$	23,958,440	$	23,299,447

The following briefly describes the composition of each loan category and portfolio class.

Commercial and industrial

Commercial and industrial loans are made available to businesses for working capital (including financing of inventory and receivables), for business expansion, facilitating the acquisition of a business, and for the purchase of equipment and machinery, including equipment leasing. These loans are primarily made based on the identified cash flows of the borrower and, when secured, have the added strength of the underlying collateral.

Commercial non-real estate loans may be secured by the assets being financed or other tangible or intangible business assets such as accounts receivable, inventory, ownership, enterprise value or commodity interests, and may incorporate a personal or corporate guarantee; however, some short-term loans may be made on an unsecured basis, including a small portfolio of corporate credit cards, generally issued as a part of overall customer relationships.

Commercial real estate – owner occupied loans consist of commercial mortgages on properties where repayment is generally dependent on the cash flow from the ongoing operations and activities of the borrower. Like commercial non-real estate, these loans are primarily made based on the identified cash flows of the borrower, but also have the added strength of the value of underlying real estate collateral.

Commercial real estate – income producing

Commercial real estate – income producing loans consist of loans secured by commercial mortgages on properties where the loan is made to real estate developers or investors and repayment is dependent on the sale, refinance, or income generated from the operation of the property. Properties financed include multifamily, retail, healthcare related facilities, industrial, office, hotel/motel and restaurants, and other commercial properties.

Construction and land development

Construction and land development loans are made to facilitate the acquisition, development, improvement and construction of both commercial and residential-purpose properties. Such loans are made to builders and investors where repayment is expected to be made from the sale, refinance or operation of the property or to businesses to be used in their business operations. This portfolio also includes residential construction loans and loans secured by raw land not yet under development.

Residential mortgages

Residential mortgages consist of closed-end loans secured by first liens on 1- 4 family residential properties. The portfolio includes both fixed and adjustable-rate loans, although most longer-term, fixed-rate loans originated are sold in the secondary mortgage market.

Consumer

Consumer loans include second lien mortgage home loans, home equity lines of credit and nonresidential consumer purpose loans. Nonresidential consumer loans are made to finance the purchase of personal property, including automobiles, recreational vehicles and boats, and for other personal purposes (secured and unsecured), and also include deposit account secured loans. Consumer loans also include a small portfolio of credit card receivables issued on the basis of applications received through referrals from the Bank’s branches, online and other marketing efforts.

The Bank makes loans in the normal course of business to directors and executive officers of the Company and the Bank and to their associates. Loans to such related parties were approximately $38.9 million and $46.2 million at December 31, 2025 and 2024, respectively. Related party loan activity in 2025 reflects new loans of $23.1 million, repayments of $30.2 million, and a net decrease of $0.2 million related to changes in directors and executive officers and their associates.

The Bank has a line of credit with the Federal Home Loan Bank of Dallas that is secured by blanket pledges of certain qualifying loan types. The Bank had $400 million borrowings on this line at December 31, 2025 and no borrowings at December 31, 2024.

The following schedules show activity in the allowance for credit losses by portfolio class for the years ended December 31, 2025, 2024 and 2023, as well as the allowance for credit loss by primary calculation method at the end of each period.


	Commercial Non-Real Estate			Commercial Real Estate-Owner Occupied			Total Commercial and Industrial			Commercial Real Estate-Income Producing			Construction and Land Development			Residential Mortgages			Consumer			Total
($ in thousands)	Year Ended December 31, 2025
Allowance for credit losses
Allowance for loan losses:
Beginning balance	$	121,090		$	36,264		$	157,354		$	71,975		$	21,158		$	42,445		$	25,950		$	318,882
Charge-offs		(45,564	)		(4,626	)		(50,190	)		(34	)		(1,314	)		(922	)		(16,006	)		(68,466	)
Recoveries		11,332			686			12,018			49			123			841			2,976			16,007
Net provision for loan losses		34,581			8,371			42,952			(11,515	)		(2,517	)		470			11,918			41,308
Ending balance - allowance for loan losses	$	121,439		$	40,695		$	162,134		$	60,475		$	17,450		$	42,834		$	24,838		$	307,731
Reserve for unfunded lending commitments:
Beginning balance	$	6,441		$	309		$	6,750		$	642		$	14,639		$	4		$	2,018		$	24,053
Provision for losses on unfunded commitments		6,198			62			6,260			363			3,310			(1	)		(57	)		9,875
Ending balance - reserve for unfunded lending commitments	$	12,639		$	371		$	13,010		$	1,005		$	17,949		$	3		$	1,961		$	33,928
Total allowance for credit losses	$	134,078		$	41,066		$	175,144		$	61,480		$	35,399		$	42,837		$	26,799		$	341,659
Allowance for credit losses:
Individually evaluated	$	6,506		$	602		$	7,108		$	—		$	—		$	236		$	54		$	7,398
Collectively evaluated	$	127,572		$	40,464		$	168,036		$	61,480		$	35,399		$	42,601		$	26,745		$	334,261


	Commercial Non-Real Estate			Commercial Real Estate-Owner Occupied			Total Commercial and Industrial			Commercial Real Estate-Income Producing			Construction and Land Development			Residential Mortgages			Consumer			Total
($ in thousands)	Year Ended December 31, 2024
Allowance for credit losses
Allowance for loan losses:
Beginning balance	$	101,737		$	40,197		$	141,934		$	74,539		$	27,039		$	38,983		$	25,412		$	307,907
Charge-offs		(45,488	)		(143	)		(45,631	)		(8,822	)		(264	)		(380	)		(17,987	)		(73,084	)
Recoveries		22,292			1,036			23,328			7			64			595			3,057			27,051
Net provision for loan losses		42,549			(4,826	)		37,723			6,251			(5,681	)		3,247			15,468			57,008
Ending balance - allowance for loan losses	$	121,090		$	36,264		$	157,354		$	71,975		$	21,158		$	42,445		$	25,950		$	318,882
Reserve for unfunded lending commitments:
Beginning balance	$	5,507		$	327		$	5,834		$	1,344		$	20,019		$	30		$	1,667		$	28,894
Provision for losses on unfunded commitments		934			(18	)		916			(702	)		(5,380	)		(26	)		351			(4,841	)
Ending balance - reserve for unfunded lending commitments	$	6,441		$	309		$	6,750		$	642		$	14,639		$	4		$	2,018		$	24,053
Total allowance for credit losses	$	127,531		$	36,573		$	164,104		$	72,617		$	35,797		$	42,449		$	27,968		$	342,935
Allowance for credit losses:
Individually evaluated	$	8,672		$	—		$	8,672		$	—		$	—		$	751		$	197		$	9,620
Collectively evaluated	$	118,859		$	36,573		$	155,432		$	72,617		$	35,797		$	41,698		$	27,771		$	333,315


	Commercial Non-Real Estate			Commercial Real Estate-Owner Occupied			Total Commercial and Industrial			Commercial Real Estate-Income Producing			Construction and Land Development			Residential Mortgages			Consumer			Total
($ in thousands)	Year Ended December 31, 2023
Allowance for credit losses
Allowance for loan losses:
Beginning balance	$	96,461		$	48,284		$	144,745		$	71,961		$	30,498		$	32,464		$	28,121		$	307,789
Charge-offs		(59,830	)		—			(59,830	)		(73	)		(72	)		(55	)		(15,393	)		(75,423	)
Recoveries		6,152			957			7,109			14			11			1,278			3,611			12,023
Net provision for loan losses		58,954			(9,044	)		49,910			2,637			(3,398	)		5,296			9,073			63,518
Ending balance - allowance for loan losses	$	101,737		$	40,197		$	141,934		$	74,539		$	27,039		$	38,983		$	25,412		$	307,907
Reserve for unfunded lending commitments:
Beginning balance	$	4,984		$	302		$	5,286		$	1,395		$	25,110		$	31		$	1,487		$	33,309
Provision for losses on unfunded commitments		523			25			548			(51	)		(5,091	)		(1	)		180			(4,415	)
Ending balance - reserve for unfunded lending commitments	$	5,507		$	327		$	5,834		$	1,344		$	20,019		$	30		$	1,667		$	28,894
Total allowance for credit losses	$	107,244		$	40,524		$	147,768		$	75,883		$	47,058		$	39,013		$	27,079		$	336,801
Allowance for credit losses:
Individually evaluated	$	1,666		$	—		$	1,666		$	—		$	—		$	—		$	—		$	1,666
Collectively evaluated	$	105,578		$	40,524		$	146,102		$	75,883		$	47,058		$	39,013		$	27,079		$	335,135

The calculation of the allowance for credit losses is performed using two primary approaches: a collective approach for pools of loans that have similar risk characteristics using a loss rate analysis, and a specific reserve analysis for credits individually evaluated. The allowance for credit losses for collectively evaluated portfolios is developed using multiple Moody’s macroeconomic forecasts applied to internally developed credit models for a two year reasonable and supportable period. These forecasts are anchored on a baseline economic forecast, which Moody’s defines as the “most likely outcome” based on current conditions and its view of where the economy is headed. The baseline scenario is positioned at the 50th percentile of possible outcomes. Several upside and downside alternative scenarios are also derived from that baseline scenario and considered when assessing reasonably possible outcomes.

The modest decrease in the allowance for credit losses at December 31, 2025 compared to December 31, 2024 reflects net decline in funded reserves, largely offset by an increase in unfunded reserves. In arriving at the allowance for credit losses at December 31, 2025, the Company weighted Moody’s December 2025 baseline economic forecast at 50% and downside mild recessionary S-2 scenario at 50%. The December 2025 baseline scenario maintains a generally optimistic outlook in its assumptions surrounding the drivers of economic growth, with no recession forecasted in the near-term. The S-2 scenario is less optimistic compared to the baseline with a mild recession forecasted starting in the first quarter of 2026 and lasting for three quarters.

The modest changes in the allowance for credit losses for the years ended December 31, 2024 and 2023 both reflected relatively stable economic conditions, outlook and credit quality metrics. In arriving at the allowance for credit losses at December 31, 2024 and December 31, 2023, the Company weighted the baseline economic forecast at 40%, the downside recessionary scenario S-2 at 60%.

Nonaccrual Loans and Certain Reportable Modified Loan Disclosures

The following table shows the composition of nonaccrual loans and those without an allowance for loan losses, by portfolio class at December 31, 2025 and 2024.


	December 31,
	2025				2024
($ in thousands)	Total Nonaccrual		Nonaccrual Without Allowance For Loan Losses		Total Nonaccrual		Nonaccrual Without Allowance For Loan Losses
Commercial non-real estate	$	34,525	$	3,294	$	33,418	$	4,855
Commercial real estate - owner occupied		6,723		1,470		2,727		1,198
Total commercial and industrial		41,248		4,764		36,145		6,053
Commercial real estate - income producing		4,760		5,114		356		—
Construction and land development		3,173		2,178		5,561		4,929
Residential mortgages		46,986		2,511		44,086		1,475
Consumer		10,703		316		11,187		500
Total loans	$	106,870	$	14,883	$	97,335	$	12,957

As a part of our loss mitigation efforts, we may provide modifications to borrowers experiencing financial difficulty to improve long-term collectability of the loans and to avoid the need for repossession or foreclosure of collateral. Nonaccrual loans include reportable nonaccruing modified loans to borrowers experiencing financial difficulty (MEFDs) of $5.8 million at December 31, 2025 and $20.2 million at December 31, 2024. Total reportable MEFDs, both accruing and nonaccruing, were $162.8 million at December 31, 2025 and $99.5 million at December 31, 2024. Unfunded commitments to borrowers whose terms have been modified as a reportable MEFD were $7.2 million and $6.9 million at December 31, 2025 and 2024, respectively.

The tables below provide detail by portfolio class for reportable MEFDs entered into during the years ended December 31, 2025 2024 and 2023. Modified facilities are reported using the balance at the end of each period reported and are reflected only once in each table based on the type of modification or combination of modification.


	Year Ended December 31, 2025
	Term Extension					Payment Delay					Term Extensions and Payment Delay					Other(1)
($ in thousands)	Balance		Percentage of Portfolio			Balance		Percentage of Portfolio			Balance		Percentage of Portfolio			Balance		Percentage of Portfolio
Commercial non-real estate	$	94,293		0.96	%	$	4,529		0.05	%	$	4,493		0.05	%	$	—		—
Commercial real estate - owner occupied		28,698		0.88	%		241		0.01	%		—		—			—		—
Total commercial and industrial		122,991		0.94	%		4,770		0.04	%		4,493		0.03	%		—		—
Commercial real estate - income producing		14,914		0.35	%		—		—			—		—			—		—
Construction and land development		147		0.01	%		—		—			—		—			—		—
Residential mortgages		11,173		0.28	%		1,319		0.03	%		2,065		0.05	%		602		0.01	%
Consumer		132		0.01	%		—		—			148		0.01	%		95		0.01	%
Total reportable modified loans	$	149,357		0.62	%	$	6,089		0.03	%	$	6,706		0.03	%	$	697		0.00	%

(1) Includes interest rate reduction and a combination of interest rate reduction and term extension.


	Year Ended December 31, 2024
	Term Extension					Payment Delay					Term Extensions and Payment Delay					Other(1)
($ in thousands)	Balance		Percentage of Portfolio			Balance		Percentage of Portfolio			Balance		Percentage of Portfolio			Balance		Percentage of Portfolio
Commercial non-real estate	$	58,176		0.59	%	$	19,150		0.19	%	$	15,373		0.16	%	$	758		0.01	%
Commercial real estate - owner occupied		—		—			—		—			—		—			—		—
Total commercial and industrial		58,176		0.45	%		19,150		0.15	%		15,373		0.12	%		758		0.01	%
Commercial real estate - income producing		2,741		0.07	%		—		—			—		—			—		—
Construction and land development		—		—			—		—			—		—			—		—
Residential mortgages		3,170		0.08	%		—		—			—		—			—		—
Consumer		131		0.01	%		—		—			—		—			—		—
Total reportable modified loans	$	64,218		0.28	%	$	19,150		0.08	%	$	15,373		0.07	%	$	758		0.00	%

(1) Includes interest rate reduction and other than insignificant payment delays.


	Year Ended December 31, 2023
	Term Extension					Payment Delay					Term Extensions and Payment Delay					Other(1)
($ in thousands)	Balance		Percentage of Portfolio			Balance		Percentage of Portfolio			Balance		Percentage of Portfolio			Balance		Percentage of Portfolio
Commercial non-real estate	$	7,930		0.08	%	$	4,274		0.04	%	$	9,753		0.10	%	$	—		—
Commercial real estate - owner occupied		1,774		0.06	%		—		—			—		—			—		—
Total commercial and industrial		9,704		0.07	%		4,274		0.03	%		9,753		0.07	%		—		—
Commercial real estate - income producing		—		—			—		—			—		—			—		—
Construction and land development		85		0.01	%		—		—			—		—			—		—
Residential mortgages		254		0.01	%		—		—			—		—			202		0.01	%
Consumer		78		0.01	%		—		—			196		0.01	%		—		—
Total reportable modified loans	$	10,121		0.04	%	$	4,274		0.02	%	$	9,949		0.04	%	$	202		0.00	%

(1) Includes interest rate reduction and other than insignificant payment delays.

Reportable modifications to borrowers experiencing financial difficulty during the year ended December 31, 2025 consisted of weighted-average term extensions totaling ten months for the commercial portfolio, two years for the residential mortgage portfolio and three years for the consumer portfolio. The weighted-average term of other than insignificant payment delays was six months for

the commercial portfolio, eight months for the residential mortgage portfolio and seven months for the consumer portfolio. The weighted-average interest rate reduction for the residential and consumer portfolio was 240 and 125 basis points, respectively. Reported term extensions and payment delays are considered more than insignificant if they exceeded six months when considering other modifications made in the past twelve months.

Reportable modifications to borrowers experiencing financial difficulty during the year ended December 31, 2024 consisted of weighted-average term extensions totaling nine months for the commercial portfolio, six years for the residential mortgage portfolio and four years for the consumer portfolio. The weighted-average term of other than insignificant payment delays for the commercial portfolio was eight months. The weighted-average interest rate reduction for the commercial portfolio was 50 basis points.

Reportable modifications to borrowers experiencing financial difficulty during the year ended December 31, 2023 consisted of weighted-average term extensions totaling ten months for commercial, ten years for residential mortgage and eight years for consumer. The weighted-average term of other than insignificant payment delays for the commercial and consumer portfolios was three months. The weighted-average interest rate reduction for the residential mortgage portfolio was 80 basis points.

The tables below present the aging analysis of reportable modifications to borrowers experiencing financial difficulty by portfolio class at December 31, 2025 and 2024.


December 31, 2025	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current		Total Reportable Modified Loans
(in thousands)
Commercial non-real estate	$	—	$	27,670	$	734	$	28,404	$	74,911	$	103,315
Commercial real estate - owner occupied		—		—		—		—		28,939		28,939
Total commercial and industrial		—		27,670		734		28,404		103,850		132,254
Commercial real estate - income producing		—		—		—		—		14,914		14,914
Construction and land development		—		—		—		—		147		147
Residential mortgages		1,285		416		—		1,701		13,458		15,159
Consumer		—		—		148		148		227		375
Total reportable modified loans	$	1,285	$	28,086	$	882	$	30,253	$	132,596	$	162,849


December 31, 2024	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current		Total Reportable Modified Loans
(in thousands)
Commercial non-real estate	$	1,975	$	—	$	12,548	$	14,523	$	78,934	$	93,457
Commercial real estate - owner occupied		—		—		—		—		—		—
Total commercial and industrial		1,975		—		12,548		14,523		78,934		93,457
Commercial real estate - income producing		—		826		—		826		1,915		2,741
Construction and land development		—		—		—		—		—		—
Residential mortgages		179		249		501		929		2,241		3,170
Consumer		—		—		—		—		131		131
Total reportable modified loans	$	2,154	$	1,075	$	13,049	$	16,278	$	83,221	$	99,499

There were seven loans to commercial borrowers totaling $27.6 million and two loans to consumer borrowers totaling $0.2 million with a reportable term extension and/or significant payment delay modification that had post modification payment defaults during the twelve months ended December 31, 2025. There were loans to seven commercial borrowers totaling $20.8 million and loans to three residential mortgage borrowers totaling $0.8 million with a reportable term extension and/or significant payment delay modification that had post modification payment defaults during the twelve months ended December 31, 2024. There was one loan to a commercial borrower totaling $4.4 million with a reportable term extension and significant payment delay modification that had a post modification payment default during the twelve months ended December 31, 2023. A payment default occurs if the loan is either 90 days or more delinquent or has been charged off as of the end of the period presented.

Aging Analysis

The tables below present the aging analysis of past due loans by portfolio class at December 31, 2025 and 2024.


December 31, 2025	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current		Total Loans		Recorded Investment > 90 Days and Accruing
($ in thousands)
Commercial non-real estate	$	19,008	$	43,316	$	39,954	$	102,278	$	9,706,733	$	9,809,011	$	20,358
Commercial real estate - owner occupied		15,013		308		7,609		22,930		3,247,150		3,270,080		1,586
Total commercial and industrial		34,021		43,624		47,563		125,208		12,953,883		13,079,091		21,944
Commercial real estate - income producing		990		2,806		7,177		10,973		4,272,195		4,283,168		2,928
Construction and land development		1,754		564		3,488		5,806		1,233,280		1,239,086		565
Residential mortgages		42,302		17,984		34,656		94,942		3,921,975		4,016,917		116
Consumer		9,284		4,675		9,839		23,798		1,316,380		1,340,178		3,245
Total loans	$	88,351	$	69,653	$	102,723	$	260,727	$	23,697,713	$	23,958,440	$	28,798


December 31, 2024	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current		Total Loans		Recorded Investment > 90 Days and Accruing
($ in thousands)
Commercial non-real estate	$	19,326	$	5,264	$	27,756	$	52,346	$	9,824,246	$	9,876,592	$	14,557
Commercial real estate - owner occupied		1,113		38		3,747		4,898		3,007,057		3,011,955		1,097
Total commercial and industrial		20,439		5,302		31,503		57,244		12,831,303		12,888,547		15,654
Commercial real estate - income producing		220		5,417		464		6,101		3,792,511		3,798,612		150
Construction and land development		1,066		3,773		5,314		10,153		1,270,962		1,281,115		3,563
Residential mortgages		42,211		25,050		34,113		101,374		3,859,954		3,961,328		27
Consumer		10,770		5,381		8,504		24,655		1,345,190		1,369,845		2,458
Total loans	$	74,706	$	44,923	$	79,898	$	199,527	$	23,099,920	$	23,299,447	$	21,852

Credit Quality Indicators

The following tables present the credit quality indicators by segment and portfolio class of loans at December 31, 2025 and 2024.


	December 31, 2025
($ in thousands)	Commercial Non- Real Estate		Commercial Real Estate - Owner Occupied		Total Commercial and Industrial		Commercial Real Estate - Income Producing		Construction and Land Development		Total Commercial
Grade:
Pass	$	9,180,624	$	3,064,325	$	12,244,949	$	4,035,415	$	1,170,834	$	17,451,198
Pass-Watch		266,120		123,373		389,493		189,994		35,305		614,792
Special Mention		88,729		23,195		111,924		8,251		28,208		148,383
Substandard		273,538		59,187		332,725		49,508		4,739		386,972
Doubtful		—		—		—		—		—		—
Total	$	9,809,011	$	3,270,080	$	13,079,091	$	4,283,168	$	1,239,086	$	18,601,345


	December 31, 2024
($ in thousands)	Commercial Non- Real Estate		Commercial Real Estate - Owner Occupied		Total Commercial and Industrial		Commercial Real Estate - Income Producing		Construction and Land Development		Total Commercial
Grade:
Pass	$	9,157,232	$	2,833,228	$	11,990,460	$	3,625,981	$	1,207,404	$	16,823,845
Pass-Watch		219,975		135,566		355,541		99,638		66,221		521,400
Special Mention		149,705		17,901		167,606		22,278		1,014		190,898
Substandard		349,680		25,260		374,940		50,715		6,476		432,131
Doubtful		—		—		—		—		—		—
Total	$	9,876,592	$	3,011,955	$	12,888,547	$	3,798,612	$	1,281,115	$	17,968,274


	December 31, 2025						December 31, 2024
($ in thousands)	Residential Mortgage		Consumer		Total		Residential Mortgage		Consumer		Total
Performing	$	3,969,931	$	1,329,475	$	5,299,406	$	3,917,242	$	1,358,658	$	5,275,900
Nonperforming		46,986		10,703		57,689		44,086		11,187		55,273
Total	$	4,016,917	$	1,340,178	$	5,357,095	$	3,961,328	$	1,369,845	$	5,331,173

The Company routinely assesses the ratings of loans in its portfolio through an established and comprehensive portfolio management process. Below are the definitions of the Company’s internally assigned grades:

Commercial:

•

Pass - loans properly approved, documented, collateralized, and performing which do not reflect an abnormal credit risk.

•

Pass - Watch - credits in this category are of sufficient risk to cause concern. This category is reserved for credits that display negative performance trends. The “Watch” grade should be regarded as a transition category.

•

Special Mention - a criticized asset category defined as having potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may, at some future date, result in the deterioration of the repayment prospects for the credit or the institution’s credit position. Special mention credits are not considered part of the classified credit categories and do not expose the institution to sufficient risk to warrant adverse classification.

•

Substandard - an asset that is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Assets so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

•

Doubtful - an asset that has all the weaknesses inherent in one classified substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

•

Loss - credits classified as loss are considered uncollectable and are charged off promptly once so classified.

Residential and Consumer:

•

Performing – accruing loans

•

Nonperforming – loans for which there are good reasons to doubt that payments will be made in full. Nonperforming loans include all loans with nonaccrual status.

Vintage Analysis

The following tables present credit quality disclosures of amortized cost by class and vintage for term loans and by revolving and revolving converted to amortizing at December 31, 2025 and 2024. The Company defines vintage as the later of origination, renewal or modification date. The gross charge-offs presented in the tables that follow are for the years ended December 31, 2025 and December 31, 2024.


	Term Loans														Revolving Loans
December 31, 2025	Amortized Cost Basis by Origination Year												Revolving		Converted to
($ in thousands)	2025		2024		2023		2022		2021		Prior		Loans		Term Loans		Total
Commercial Non-Real Estate:
Pass	$	2,030,587	$	1,164,266	$	711,218	$	812,902	$	525,095	$	891,032	$	2,955,174	$	90,350	$	9,180,624
Pass-Watch		24,737		27,477		39,683		33,385		12,896		18,064		94,461		15,417		266,120
Special Mention		2,405		6,975		6,239		27,719		10,564		4,305		28,330		2,192		88,729
Substandard		13,738		6,450		81,228		87,745		11,275		6,798		51,619		14,685		273,538
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	2,071,467	$	1,205,168	$	838,368	$	961,751	$	559,830	$	920,199	$	3,129,584	$	122,644	$	9,809,011
Gross Charge-offs	$	4,798	$	2,718	$	15,397	$	2,888	$	74	$	531	$	3,722	$	15,436	$	45,564
Commercial Real Estate - Owner Occupied:
Pass	$	616,536	$	401,399	$	312,006	$	461,247	$	459,700	$	711,509	$	51,600	$	50,328	$	3,064,325
Pass-Watch		26,766		6,397		2,746		43,060		14,187		27,591		2,506		120		123,373
Special Mention		2,371		2,202		1,008		12,024		5,054		293		195		48		23,195
Substandard		2,082		822		6,685		20,353		1,472		27,723		50		—		59,187
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	647,755	$	410,820	$	322,445	$	536,684	$	480,413	$	767,116	$	54,351	$	50,496	$	3,270,080
Gross Charge-offs	$	—	$	—	$	86	$	—	$	2,741	$	1,799	$	—	$	—	$	4,626
Commercial Real Estate - Income Producing:
Pass	$	1,110,044	$	416,052	$	519,955	$	724,326	$	549,335	$	649,996	$	64,217	$	1,490	$	4,035,415
Pass-Watch		22,429		15,606		4,219		101,959		4,277		40,381		1,123		—		189,994
Special Mention		7,962		—		289		—		—		—		—		—		8,251
Substandard		192		—		7,669		10,441		10,871		20,185		150		—		49,508
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	1,140,627	$	431,658	$	532,132	$	836,726	$	564,483	$	710,562	$	65,490	$	1,490	$	4,283,168
Gross Charge-offs	$	—	$	—	$	—	$	34	$	—	$	—	$	—	$	—	$	34
Construction and Land Development:
Pass	$	349,811	$	358,827	$	185,672	$	54,798	$	75,084	$	14,954	$	131,153	$	535	$	1,170,834
Pass-Watch		29,323		814		1,500		3,299		128		241		—		—		35,305
Special Mention		60		—		—		28,036		112		—		—		—		28,208
Substandard		72		185		1,665		2,560		135		122		—		—		4,739
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	379,266	$	359,826	$	188,837	$	88,693	$	75,459	$	15,317	$	131,153	$	535	$	1,239,086
Gross Charge-offs	$	—	$	—	$	—	$	1,297	$	—	$	17	$	—	$	—	$	1,314
Residential Mortgage:
Performing	$	360,686	$	131,928	$	390,276	$	1,039,884	$	824,012	$	1,220,288	$	2,857	$	—	$	3,969,931
Nonperforming		371		2,300		10,582		10,244		6,335		17,154		—		—		46,986
Total	$	361,057	$	134,228	$	400,858	$	1,050,128	$	830,347	$	1,237,442	$	2,857	$	—	$	4,016,917
Gross Charge-offs	$	—	$	36	$	502	$	335	$	—	$	49	$	—	$	—	$	922
Consumer Loans:
Performing	$	50,512	$	24,693	$	22,963	$	18,103	$	8,928	$	47,131	$	1,123,471	$	33,674	$	1,329,475
Nonperforming		51		44		349		842		627		4,367		408		4,015		10,703
Total	$	50,563	$	24,737	$	23,312	$	18,945	$	9,555	$	51,498	$	1,123,879	$	37,689	$	1,340,178
Gross Charge-offs	$	85	$	952	$	1,104	$	1,277	$	528	$	695	$	9,228	$	2,137	$	16,006


	Term Loans														Revolving Loans
December 31, 2024	Amortized Cost Basis by Origination Year												Revolving		Converted to
($ in thousands)	2024		2023		2022		2021		2020		Prior		Loans		Term Loans		Total
Commercial Non-Real Estate:
Pass	$	1,794,904	$	1,069,637	$	1,154,669	$	819,520	$	339,594	$	925,046	$	2,946,499	$	107,363	$	9,157,232
Pass-Watch		8,466		46,681		43,379		29,193		12,768		9,851		61,076		8,561		219,975
Special Mention		412		21,337		52,375		6,044		6,234		41		62,934		328		149,705
Substandard		19,839		91,192		117,545		15,225		8,200		2,898		65,138		29,643		349,680
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	1,823,621	$	1,228,847	$	1,367,968	$	869,982	$	366,796	$	937,836	$	3,135,647	$	145,895	$	9,876,592
Gross Charge-offs	$	705	$	7,575	$	7,494	$	11,090	$	213	$	1,837	$	5,952	$	10,622	$	45,488
Commercial Real Estate - Owner Occupied:
Pass	$	365,158	$	319,684	$	537,069	$	524,572	$	433,844	$	554,293	$	97,999	$	609	$	2,833,228
Pass-Watch		18,937		8,575		66,286		5,547		2,695		29,078		3,727		721		135,566
Special Mention		4,417		410		6,759		3,756		—		2,559		—		—		17,901
Substandard		1,322		2,630		5,574		1,563		1,248		12,923		—		—		25,260
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	389,834	$	331,299	$	615,688	$	535,438	$	437,787	$	598,853	$	101,726	$	1,330	$	3,011,955
Gross Charge-offs	$	—	$	—	$	131	$	—	$	—	$	12	$	—	$	—	$	143
Commercial Real Estate - Income Producing:
Pass	$	416,947	$	453,428	$	975,075	$	750,907	$	494,925	$	501,389	$	31,673	$	1,637	$	3,625,981
Pass-Watch		2,586		7,005		43,221		9,399		20,694		16,354		220		159		99,638
Special Mention		20,292		—		1,986		—		—		—		—		—		22,278
Substandard		1,818		18,189		8,604		2,210		19,731		163		—		—		50,715
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	441,643	$	478,622	$	1,028,886	$	762,516	$	535,350	$	517,906	$	31,893	$	1,796	$	3,798,612
Gross Charge-offs	$	—	$	—	$	8,819	$	—	$	—	$	3	$	—	$	—	$	8,822
Construction and Land Development:
Pass	$	237,136	$	418,002	$	296,286	$	103,259	$	33,519	$	14,477	$	102,694	$	2,031	$	1,207,404
Pass-Watch		624		2,279		62,415		391		30		323		159		—		66,221
Special Mention		1,014		—		—		—		—		—		—		—		1,014
Substandard		324		796		1,576		3,554		26		200		—		—		6,476
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	239,098	$	421,077	$	360,277	$	107,204	$	33,575	$	15,000	$	102,853	$	2,031	$	1,281,115
Gross Charge-offs	$	—	$	113	$	94	$	30	$	—	$	20	$	—	$	7	$	264
Residential Mortgage:
Performing	$	161,019	$	422,269	$	1,068,191	$	882,918	$	447,690	$	932,182	$	2,772	$	201	$	3,917,242
Nonperforming		327		7,724		10,974		6,687		1,199		17,175		—		—		44,086
Total	$	161,346	$	429,993	$	1,079,165	$	889,605	$	448,889	$	949,357	$	2,772	$	201	$	3,961,328
Gross Charge-offs	$	—	$	57	$	189	$	2	$	—	$	132	$	—	$	—	$	380
Consumer Loans:
Performing	$	56,983	$	39,301	$	35,320	$	20,397	$	15,035	$	41,299	$	1,120,027	$	30,296	$	1,358,658
Nonperforming		51		46		320		639		767		3,442		535		5,387		11,187
Total	$	57,034	$	39,347	$	35,640	$	21,036	$	15,802	$	44,741	$	1,120,562	$	35,683	$	1,369,845
Gross Charge-offs	$	92	$	1,733	$	2,474	$	1,173	$	180	$	985	$	8,826	$	2,524	$	17,987

Residential Mortgage Loans in Process of Foreclosure

Loans in process of foreclosure include those for which formal foreclosure proceedings are in process according to local requirements of the applicable jurisdiction. Included in loans are $12.0 million and $10.5 million of consumer loans secured by single family residential real estate that are in process of foreclosure as of December 31, 2025 and 2024, respectively. In addition to the single family residential real estate loans in process of foreclosure, the Company also held $5.1 million and $2.0 million of foreclosed single family residential properties in other real estate owned as of December 31, 2025 and 2024, respectively.

Loans Held for Sale

Loans held for sale totaled $33.2 million and $21.5 million at December 31, 2025 and 2024, respectively. Loans held for sale is composed primarily of residential mortgage loans originated for sale in the secondary market. At December 31, 2025, residential mortgage loans carried at the fair value option totaled $33.2 million with an unpaid principal balance of $32.3 million. At December 31, 2024 residential mortgage loans carried at the fair value option totaled $18.9 million with an unpaid principal balance of $18.6 million. All other loans held for sale are carried at lower of cost or market.