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Table of Contents

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025

​

OR

​

☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ________

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Commission File Number 001-38412

BRIDGEWATER BANCSHARES, INC.

(Exact name of registrant as specified in its charter)

​

​ | ​ | ​
Minnesota (State or other jurisdiction of incorporation or organization) | ​ | 26-0113412 (I.R.S. Employer Identification No.)
​ | ​ | ​
4450 Excelsior Boulevard, Suite 100 St. Louis Park, Minnesota (Address of principal executive offices) | ​ | 55416 (Zip Code)

​

(952) 893-6868

(Registrant’s telephone number, including area code)

. Securities registered pursuant to Section 12(b) of the Act:

​

Title of each class: |  | Trading Symbol |  | Name of each exchange on which registered:
Common Stock, $0.01 Par Value |  | BWB |  | The Nasdaq Stock Market LLC
Depositary Shares, each representing a 1/100th interest in a share of 5.875% Non-Cumulative Perpetual Preferred Stock, Series A, par value $0.01 per share | ​ | BWBBP | ​ | The Nasdaq Stock Market LLC

​

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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​ ​ | ​ | ​ | ​
Large accelerated filer | ☐ | Accelerated filer | ☒
Non-accelerated filer | ☐ | Smaller reporting company | ☐
​ | Emerging growth company ☐ | ​ | ​

​

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

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The number of shares of the Common Stock outstanding as of October 28, 2025 was 27,584,732.

​

​

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Table of Contents

Table of Contents

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| ​
PART I FINANCIAL INFORMATION | 3
​ | ​
Item 1. Consolidated Financial Statements (unaudited) | 3
Consolidated Balance Sheets | 3
Consolidated Statements of Income | 4
Consolidated Statements of Comprehensive Income | 5
Consolidated Statements of Shareholders’ Equity | 6
Consolidated Statements of Cash Flows | 7
Notes to Consolidated Financial Statements | 8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations | 43
Item 3. Quantitative and Qualitative Disclosures About Market Risk | 71
Item 4. Controls and Procedures | 72
​ | ​
PART II OTHER INFORMATION | 73
​ | ​
Item 1. Legal Proceedings | 73
Item 1A. Risk Factors | 73
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 73
Item 3. Defaults Upon Senior Securities | 74
Item 4. Mine Safety Disclosures | 74
Item 5. Other Information | 74
Item 6. Exhibits | 75
​ | ​
SIGNATURES | 76
​ | ​

​

​

​

2

Table of Contents

PART 1 – FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

Bridgewater Bancshares, Inc. and Subsidiaries

Consolidated Balance Sheets

(dollars in thousands, except share data)

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, | ​ | December 31,
​ |  | 2025 |  | 2024
​ | ​ | (Unaudited) | ​ | ​ | ​
ASSETS | ​ | ​ | ​ | ​ | ​ | ​
Cash and Cash Equivalents | ​ | $ | 131,818 | ​ | $ | 229,760
Bank-Owned Certificates of Deposit | ​ |  | 3,658 | ​ |  | 4,377
Securities Available for Sale, at Fair Value | ​ |  | 826,473 | ​ |  | 768,247
Loans, Net of Allowance for Credit Losses of $56,390 at September 30, 2025 (unaudited) and $52,277 at December 31, 2024 | ​ | ​ | 4,149,882 | ​ |  | 3,809,436
Federal Home Loan Bank (FHLB) Stock, at Cost | ​ |  | 21,373 | ​ |  | 19,297
Premises and Equipment, Net | ​ |  | 50,955 | ​ |  | 49,533
Accrued Interest | ​ |  | 19,244 | ​ |  | 17,711
Goodwill | ​ |  | 11,982 | ​ |  | 11,982
Other Intangible Assets, Net | ​ |  | 7,160 | ​ |  | 7,850
Bank-Owned Life Insurance | ​ | ​ | 46,121 | ​ | ​ | 44,646
Other Assets | ​ |  | 91,328 | ​ |  | 103,403
Total Assets | ​ | $ | 5,359,994 | ​ | $ | 5,066,242
​ | ​ | ​ | ​ | ​ | ​ | ​
LIABILITIES AND EQUITY | ​ |  |  | ​ |  |
LIABILITIES | ​ |  |  | ​ |  |
Deposits: | ​ |  |  | ​ |  |
Noninterest Bearing | ​ | $ | 822,632 | ​ | $ | 800,763
Interest Bearing | ​ |  | 3,470,132 | ​ |  | 3,286,004
Total Deposits | ​ |  | 4,292,764 | ​ |  | 4,086,767
Notes Payable | ​ | ​ | — | ​ | ​ | 13,750
FHLB Advances | ​ |  | 404,500 | ​ |  | 359,500
Subordinated Debentures, Net of Issuance Costs | ​ |  | 108,588 | ​ |  | 79,670
Accrued Interest Payable | ​ |  | 5,208 | ​ |  | 4,008
Other Liabilities | ​ |  | 51,471 | ​ |  | 64,612
Total Liabilities | ​ |  | 4,862,531 | ​ |  | 4,608,307
​ | ​ | ​ | ​ | ​ | ​ | ​
SHAREHOLDERS' EQUITY | ​ |  |  | ​ |  |
Preferred Stock- $0.01 par value; Authorized 10,000,000 | ​ | ​ | ​ | ​ | ​ | ​
Preferred Stock - Issued and Outstanding 27,600 Series A shares ($2,500 liquidation preference) at September 30, 2025 (unaudited) and December 31, 2024 | ​ | ​ | 66,514 | ​ |  | 66,514
Common Stock- $0.01 par value; Authorized 75,000,000 | ​ |  | ​ | ​ |  | ​
Common Stock - Issued and Outstanding 27,584,732 at September 30, 2025 (unaudited) and 27,552,449 at December 31, 2024 | ​ | ​ | 276 | ​ |  | 276
Additional Paid-In Capital | ​ |  | 97,101 | ​ |  | 95,088
Retained Earnings | ​ |  | 339,135 | ​ |  | 309,421
Accumulated Other Comprehensive Loss | ​ |  | (5,563) | ​ |  | (13,364)
Total Shareholders' Equity | ​ |  | 497,463 | ​ |  | 457,935
Total Liabilities and Equity | ​ | $ | 5,359,994 | ​ | $ | 5,066,242

​

See accompanying notes to consolidated financial statements.

3

Table of Contents

Bridgewater Bancshares, Inc. and Subsidiaries

Consolidated Statements of Income

(dollars in thousands, except per share data)

(Unaudited)

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30, | ​ | September 30, | ​ | September 30,
​ |  | 2025 |  | 2024 |  | 2025 |  | 2024
INTEREST INCOME |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |
Loans, Including Fees | ​ | $ | 60,038 | ​ | $ | 51,895 | ​ | $ | 171,746 | ​ | $ | 152,861
Investment Securities | ​ |  | 10,371 | ​ |  | 8,725 | ​ |  | 28,968 | ​ |  | 24,818
Other | ​ |  | 3,224 | ​ |  | 2,407 | ​ |  | 7,825 | ​ |  | 4,895
Total Interest Income | ​ |  | 73,633 | ​ |  | 63,027 | ​ |  | 208,539 | ​ |  | 182,574
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
INTEREST EXPENSE | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​
Deposits | ​ |  | 34,615 | ​ |  | 34,187 | ​ |  | 99,215 | ​ | ​ | 95,995
Federal Funds Purchased | ​ | ​ | — | ​ | ​ | 2 | ​ | ​ | 16 | ​ | ​ | 1,159
Notes Payable | ​ |  | 106 | ​ |  | 296 | ​ |  | 624 | ​ | ​ | 887
FHLB Advances | ​ |  | 2,933 | ​ |  | 1,942 | ​ |  | 7,941 | ​ | ​ | 6,325
Subordinated Debentures | ​ |  | 1,888 | ​ |  | 1,001 | ​ |  | 3,992 | ​ | ​ | 2,982
Total Interest Expense | ​ |  | 39,542 | ​ |  | 37,428 | ​ |  | 111,788 | ​ |  | 107,348
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
NET INTEREST INCOME | ​ |  | 34,091 | ​ |  | 25,599 | ​ |  | 96,751 | ​ |  | 75,226
Provision for Credit Losses | ​ |  | 1,100 | ​ |  | — | ​ |  | 4,600 | ​ | ​ | 1,350
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
NET INTEREST INCOME AFTER | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
PROVISION FOR CREDIT LOSSES | ​ |  | 32,991 | ​ |  | 25,599 | ​ |  | 92,151 | ​ |  | 73,876
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
NONINTEREST INCOME | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
Customer Service Fees | ​ |  | 501 | ​ | ​ | 373 | ​ |  | 1,492 | ​ | ​ | 1,081
Net Gain (Loss) on Sales of Available for Sale Securities | ​ |  | 59 | ​ | ​ | (28) | ​ |  | 534 | ​ | ​ | 385
Letter of Credit Fees | ​ |  | 383 | ​ | ​ | 424 | ​ |  | 1,161 | ​ | ​ | 1,127
Debit Card Interchange Fees | ​ | ​ | 173 | ​ | ​ | 152 | ​ | ​ | 462 | ​ | ​ | 448
Swap Fees | ​ | ​ | — | ​ | ​ | 26 | ​ | ​ | 980 | ​ | ​ | 26
Bank-Owned Life Insurance | ​ | ​ | 440 | ​ | ​ | 352 | ​ | ​ | 1,206 | ​ | ​ | 965
Investment Advisory Fees | ​ | ​ | 208 | ​ | ​ | — | ​ | ​ | 746 | ​ | ​ | —
FHLB Prepayment Income | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 301 | ​ | ​ | —
Other Income | ​ | ​ | 297 | ​ | ​ | 223 | ​ | ​ | 885 | ​ | ​ | 803
Total Noninterest Income | ​ |  | 2,061 | ​ |  | 1,522 | ​ |  | 7,767 | ​ |  | 4,835
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
NONINTEREST EXPENSE | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
Salaries and Employee Benefits | ​ |  | 12,229 | ​ | ​ | 9,851 | ​ |  | 34,963 | ​ | ​ | 28,959
Occupancy and Equipment | ​ |  | 1,266 | ​ | ​ | 1,069 | ​ |  | 3,774 | ​ | ​ | 3,218
FDIC Insurance Assessment | ​ |  | 775 | ​ | ​ | 750 | ​ |  | 1,975 | ​ | ​ | 2,350
Data Processing | ​ | ​ | 637 | ​ | ​ | 368 | ​ | ​ | 1,881 | ​ | ​ | 1,252
Professional and Consulting Fees | ​ | ​ | 1,261 | ​ | ​ | 1,149 | ​ | ​ | 3,365 | ​ | ​ | 2,890
Derivative Collateral Fees | ​ | ​ | 309 | ​ | ​ | 381 | ​ | ​ | 1,132 | ​ | ​ | 1,395
Information Technology and Telecommunications | ​ | ​ | 973 | ​ | ​ | 840 | ​ | ​ | 2,915 | ​ | ​ | 2,448
Marketing and Advertising | ​ | ​ | 658 | ​ | ​ | 367 | ​ | ​ | 1,420 | ​ | ​ | 1,006
Intangible Asset Amortization | ​ | ​ | 230 | ​ | ​ | 9 | ​ | ​ | 690 | ​ | ​ | 26
Other Expense | ​ | ​ | 1,618 | ​ | ​ | 976 | ​ | ​ | 4,918 | ​ | ​ | 2,944
Total Noninterest Expense | ​ |  | 19,956 | ​ |  | 15,760 | ​ |  | 57,033 | ​ |  | 46,488
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
INCOME BEFORE INCOME TAXES | ​ |  | 15,096 | ​ |  | 11,361 | ​ |  | 42,885 | ​ |  | 32,223
Provision for Income Taxes | ​ |  | 3,495 | ​ |  | 2,686 | ​ |  | 10,131 | ​ |  | 7,602
NET INCOME | ​ | ​ | 11,601 | ​ | ​ | 8,675 | ​ | ​ | 32,754 | ​ | ​ | 24,621
Preferred Stock Dividends | ​ | ​ | (1,013) | ​ | ​ | (1,013) | ​ | ​ | (3,040) | ​ | ​ | (3,040)
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS | ​ | $ | 10,588 | ​ | $ | 7,662 | ​ | $ | 29,714 | ​ | $ | 21,581
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
EARNINGS PER SHARE | ​ |  | ​ | ​ |  |  | ​ |  | ​ | ​ |  | ​
Basic | ​ | $ | 0.38 | ​ | $ | 0.28 | ​ | $ | 1.08 | ​ | $ | 0.79
Diluted | ​ | ​ | 0.38 | ​ | ​ | 0.27 | ​ | ​ | 1.06 | ​ | ​ | 0.77

​

See accompanying notes to consolidated financial statements.

4

Table of Contents

Bridgewater Bancshares, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income

(dollars in thousands)

(Unaudited)

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
​ |  | 2025 |  | 2024 |  | 2025 |  | 2024
Net Income | ​ | $ | 11,601 | ​ | $ | 8,675 | ​ | $ | 32,754 | ​ | $ | 24,621
Other Comprehensive Income (Loss): | ​ |  | ​ | ​ | ​ | ​ | ​ |  | ​ | ​ | ​ | ​
Unrealized Gains on Available for Sale Securities | ​ | ​ | 13,860 | ​ | ​ | 14,738 | ​ | ​ | 21,068 | ​ | ​ | 16,141
Unrealized Gains (Losses) on Cash Flow Hedges | ​ | ​ | (41) | ​ | ​ | (6,761) | ​ | ​ | (4,538) | ​ | ​ | 987
Reclassification Adjustment for Gains Realized in Income | ​ | ​ | (1,659) | ​ | ​ | (2,498) | ​ | ​ | (5,583) | ​ | ​ | (7,543)
Income Tax Impact | ​ | ​ | (3,495) | ​ | ​ | (1,575) | ​ | ​ | (3,146) | ​ | ​ | (2,755)
Total Other Comprehensive Income, Net of Tax | ​ | ​ | 8,665 | ​ | ​ | 3,904 | ​ | ​ | 7,801 | ​ | ​ | 6,830
Comprehensive Income | ​ | $ | 20,266 | ​ | $ | 12,579 | ​ | $ | 40,555 | ​ | $ | 31,451

​

See accompanying notes to consolidated financial statements.

​

5

Table of Contents

Bridgewater Bancshares, Inc. and Subsidiaries

Consolidated Statements of Shareholders’ Equity

Three and Nine Months Ended September 30, 2025 and 2024

(dollars in thousands, except share data)

(Unaudited)

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Accumulated | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Additional | ​ | ​ | ​ | ​ | Other | ​ | ​ | ​
​ | ​ | Preferred | ​ | Common Stock | ​ | Paid-In | ​ | Retained | ​ | Comprehensive | ​ | ​ | ​
Three Months Ended | ​ | Stock |  | Shares |  | Amount |  | Capital |  | Earnings |  | Income (Loss) |  | Total
BALANCE June 30, 2024 |  | $ | 66,514 | ​ | 27,348,049 | ​ | $ | 273 | ​ | $ | 93,205 | ​ | $ | 294,569 | ​ | $ | (15,320) | ​ | $ | 439,241
Stock-based Compensation |  | ​ | — | ​ | 8,496 | ​ | ​ | — | ​ | ​ | 923 | ​ | ​ | — | ​ | ​ | — | ​ |  | 923
Comprehensive Income |  | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 8,675 | ​ | ​ | 3,904 | ​ |  | 12,579
Stock Options Exercised | ​ | ​ | — | ​ | 69,856 | ​ | ​ | 1 | ​ | ​ | 517 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 518
Vested Restricted Stock Units | ​ | ​ | — | ​ | 3,000 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
Restricted Shares Withheld for Taxes | ​ | ​ | — | ​ | (3,711) | ​ | ​ | — | ​ | ​ | (48) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (48)
Preferred Stock Dividend | ​ | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (1,013) | ​ | ​ | — | ​ | ​ | (1,013)
BALANCE September 30, 2024 |  | $ | 66,514 | ​ | 27,425,690 | ​ | $ | 274 | ​ | $ | 94,597 | ​ | $ | 302,231 | ​ | $ | (11,416) | ​ | $ | 452,200
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
BALANCE June 30, 2025 |  | $ | 66,514 | ​ | 27,470,283 | ​ | $ | 275 | ​ | $ | 95,174 | ​ | $ | 328,547 | ​ | $ | (14,228) | ​ | $ | 476,282
Stock-based Compensation |  | ​ | — | ​ | 7,566 | ​ | ​ | — | ​ | ​ | 1,079 | ​ | ​ | — | ​ | ​ | — | ​ |  | 1,079
Comprehensive Income |  | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 11,601 | ​ | ​ | 8,665 | ​ |  | 20,266
Stock Options Exercised | ​ | ​ | — | ​ | 106,563 | ​ | ​ | 1 | ​ | ​ | 851 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 852
Vested Restricted Stock Units | ​ | ​ | — | ​ | 500 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
Restricted Shares Withheld for Taxes | ​ | ​ | — | ​ | (180) | ​ | ​ | — | ​ | ​ | (3) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (3)
Preferred Stock Dividend | ​ | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (1,013) | ​ | ​ | — | ​ | ​ | (1,013)
BALANCE September 30, 2025 |  | $ | 66,514 | ​ | 27,584,732 | ​ | $ | 276 | ​ | $ | 97,101 | ​ | $ | 339,135 | ​ | $ | (5,563) | ​ | $ | 497,463

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Accumulated | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Additional | ​ | ​ | ​ | ​ | Other | ​ | ​ | ​
​ | ​ | Preferred | ​ | Common Stock | ​ | Paid-In | ​ | Retained | ​ | Comprehensive | ​ | ​ | ​
Nine Months Ended |  | Stock |  | Shares |  | Amount |  | Capital |  | Earnings |  | Income (Loss) |  | Total
BALANCE December 31, 2023 |  | $ | 66,514 | ​ | 27,748,965 | ​ | $ | 277 | ​ | $ | 96,320 | ​ | $ | 280,650 | ​ | $ | (18,246) | ​ | $ | 425,515
Stock-based Compensation |  | ​ | — | ​ | 29,832 | ​ | ​ | — | ​ | ​ | 2,994 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 2,994
Comprehensive Income |  | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 24,621 | ​ | ​ | 6,830 | ​ | ​ | 31,451
Stock Options Exercised | ​ | ​ | — | ​ | 78,356 | ​ | ​ | 1 | ​ | ​ | 586 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 587
Stock Repurchases | ​ | ​ | — | ​ | (446,509) | ​ | ​ | (4) | ​ | ​ | (5,173) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (5,177)
Vested Restricted Stock Units | ​ | ​ | — | ​ | 25,665 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
Restricted Shares Withheld for Taxes | ​ | ​ | — | ​ | (10,619) | ​ | ​ | — | ​ | ​ | (130) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (130)
Preferred Stock Dividend | ​ | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (3,040) | ​ | ​ | — | ​ | ​ | (3,040)
BALANCE September 30, 2024 |  | $ | 66,514 | ​ | 27,425,690 | ​ | $ | 274 | ​ | $ | 94,597 | ​ | $ | 302,231 | ​ | $ | (11,416) | ​ | $ | 452,200
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
BALANCE December 31, 2024 | ​ | $ | 66,514 | ​ | 27,552,449 | ​ | $ | 276 | ​ | $ | 95,088 | ​ | $ | 309,421 | ​ | $ | (13,364) | ​ | $ | 457,935
Stock-based Compensation |  | ​ | — | ​ | 23,495 | ​ | ​ | — | ​ | ​ | 3,118 | ​ | ​ | — | ​ | ​ | — | ​ |  | 3,118
Comprehensive Income (Loss) |  | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 32,754 | ​ | ​ | 7,801 | ​ |  | 40,555
Stock Options Exercised | ​ | ​ | — | ​ | 148,738 | ​ | ​ | 1 | ​ | ​ | 1,246 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 1,247
Stock Repurchases | ​ | ​ | — | ​ | (167,709) | ​ | ​ | (1) | ​ | ​ | (2,190) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (2,191)
Vested Restricted Stock Units | ​ | ​ | — | ​ | 38,962 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
Restricted Shares Withheld for Taxes | ​ | ​ | — | ​ | (11,203) | ​ | ​ | — | ​ | ​ | (161) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (161)
Preferred Stock Dividend | ​ | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (3,040) | ​ | ​ | — | ​ | ​ | (3,040)
BALANCE September 30, 2025 |  | $ | 66,514 | ​ | 27,584,732 | ​ | $ | 276 | ​ | $ | 97,101 | ​ | $ | 339,135 | ​ | $ | (5,563) | ​ | $ | 497,463

​

See accompanying notes to consolidated financial statements.

6

Table of Contents

Bridgewater Bancshares, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(dollars in thousands)

(Unaudited)

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Nine Months Ended
​ | ​ | September 30,
​ | ​ | 2025 | ​ | 2024
CASH FLOWS FROM OPERATING ACTIVITIES | ​ | ​ | ​ | ​ | ​ | ​
Net Income | ​ | $ | 32,754 | ​ | $ | 24,621
Adjustments to Reconcile Net Income to Net Cash | ​ |  | ​ | ​ |  | ​
Provided by Operating Activities: | ​ |  | ​ | ​ |  | ​
Net Amortization on Securities Available for Sale | ​ |  | (2,635) | ​ |  | (1,064)
Net Gain on Sales of Securities Available for Sale | ​ |  | (534) | ​ |  | (385)
Provision for Credit Losses on Loans and Leases | ​ |  | 4,400 | ​ |  | 1,450
Credit for Credit Losses on Off-Balance Sheet Exposures | ​ | ​ | 200 | ​ | ​ | (100)
Depreciation of Premises and Equipment | ​ |  | 1,881 | ​ |  | 1,767
Amortization of Other Intangible Assets | ​ |  | 690 | ​ |  | 26
Amortization of Right-of Use Asset | ​ | ​ | 419 | ​ | ​ | 117
Cash Surrender Value of Bank-Owned Life Insurance | ​ | ​ | (1,206) | ​ | ​ | (965)
Amortization of Subordinated Debt Issuance Costs | ​ | ​ | 208 | ​ | ​ | 286
Stock-based Compensation | ​ |  | 3,118 | ​ |  | 2,994
Deferred Income Taxes | ​ | ​ | (2,701) | ​ | ​ | (1,100)
Changes in Operating Assets and Liabilities: | ​ |  | ​ | ​ |  | ​
Accrued Interest Receivable and Other Assets | ​ |  | (1,232) | ​ |  | (465)
Accrued Interest Payable and Other Liabilities | ​ |  | (14,527) | ​ |  | (15,383)
Net Cash Provided by Operating Activities | ​ |  | 20,835 | ​ |  | 11,799
​ | ​ | ​ | ​ | ​ | ​ | ​
CASH FLOWS FROM INVESTING ACTIVITIES | ​ |  | ​ | ​ |  | ​
Decrease in Bank-Owned Certificates of Deposit | ​ |  | 719 | ​ | ​ | —
Proceeds from Sales of Securities Available for Sale | ​ |  | 64,707 | ​ | ​ | 101,612
Proceeds from Maturities, Paydowns, Payups and Calls of Securities Available for Sale | ​ |  | 108,590 | ​ | ​ | 45,219
Purchases of Securities Available for Sale | ​ |  | (204,111) | ​ | ​ | (189,344)
Net Increase in Loans | ​ |  | (344,846) | ​ | ​ | 36,464
Net Increase in FHLB Stock | ​ |  | (2,076) | ​ | ​ | (1,529)
Purchases of Premises and Equipment | ​ |  | (3,303) | ​ | ​ | (658)
Purchase of Bank-owned Life Insurance | ​ | ​ | (4,630) | ​ | ​ | —
Redemption of Bank-owned Life Insurance | ​ | ​ | 4,361 | ​ | ​ | —
Net Cash Used in Investing Activities | ​ | ​ | (380,589) | ​ |  | (8,236)
​ | ​ | ​ | ​ | ​ | ​ | ​
CASH FLOWS FROM FINANCING ACTIVITIES | ​ |  | ​ | ​ |  | ​
Net Increase in Deposits | ​ |  | 205,997 | ​ | ​ | 37,494
Principal Payments on Notes Payable | ​ |  | (13,750) | ​ | ​ | —
Proceeds from FHLB Advances | ​ |  | 936,500 | ​ | ​ | 699,000
Principal Payments on FHLB Advances | ​ | ​ | (891,500) | ​ | ​ | (669,000)
Issuance of Subordinated Debt, net of Issuance Costs | ​ | ​ | 78,690 | ​ | ​ | —
Redemption of Subordinated Debt, net of Issuance Costs | ​ | ​ | (49,980) | ​ | ​ | —
Preferred Stock Dividends Paid | ​ | ​ | (3,040) | ​ | ​ | (3,040)
Stock Options Exercised | ​ | ​ | 1,247 | ​ | ​ | 587
Stock Repurchases | ​ | ​ | (2,191) | ​ | ​ | (5,177)
Shares Repurchased for Tax Withholdings Upon Vesting of Restricted Stock-Based Awards | ​ | ​ | (131) | ​ | ​ | (94)
Shares Repurchased for Tax Withholdings Upon Exercise Stock Options | ​ | ​ | (30) | ​ | ​ | (36)
Net Cash Provided by Financing Activities | ​ |  | 261,812 | ​ |  | 59,734
​ | ​ | ​ | ​ | ​ | ​ | ​
NET CHANGE IN CASH AND CASH EQUIVALENTS | ​ |  | (97,942) | ​ |  | 63,297
Cash and Cash Equivalents Beginning | ​ |  | 229,760 | ​ |  | 128,562
Cash and Cash Equivalents Ending | ​ | $ | 131,818 | ​ | $ | 191,859
​ | ​ | ​ | ​ | ​ | ​ | ​
SUPPLEMENTAL CASH FLOW DISCLOSURE | ​ |  | ​ | ​ |  | ​
Cash Paid for Interest | ​ | $ | 110,380 | ​ | $ | 108,886
Cash Paid for Income Taxes | ​ |  | ​ | ​ |  | ​
Federal | ​ | $ | 6,000 | ​ | $ | 2,850
Minnesota | ​ | ​ | 4,050 | ​ | ​ | 2,516
Other States | ​ | ​ | 158 | ​ | ​ | 119
Total Cash Paid for Income Taxes | ​ | $ | 10,208 | ​ | $ | 5,485
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES | ​ | ​ | ​ | ​ | ​ | ​
Loans Transferred to Foreclosed Assets | ​ | ​ | — | ​ | ​ | 434

​

​ | ​ | ​ | ​ | ​ | ​ | ​ ​ ​

See accompanying notes to consolidated financial statements.

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Bridgewater Bancshares, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

(Unaudited)

Note 1: Description of the Business and Summary of Significant Accounting Policies

Organization

Bridgewater Bancshares, Inc. (the “Company”) is a financial holding company whose operations consist of the ownership of its wholly-owned subsidiary, Bridgewater Bank (the “Bank”). The Bank commenced operations in 2005 and provides retail and commercial loan and deposit services, principally to customers within the Minneapolis-St. Paul-Bloomington, MN-WI Metropolitan Statistical Area. In 2008, the Bank formed BWB Holdings, LLC, a wholly-owned subsidiary of the Bank, for the purpose of holding repossessed property. In 2018, the Bank formed Bridgewater Investment Management, Inc., a wholly-owned subsidiary of the Bank, for the purpose of holding certain municipal securities and to engage in municipal lending activities.

Recent Developments

On December 13, 2024, the Bank completed its acquisition of First Minnetonka City Bank (“FMCB”) in an all-cash transaction. On the closing date, FMCB merged with and into the Bank, with the Bank as the surviving entity. The acquisition of FMCB added two full-service branches in Minnetonka, Minnesota to the Bank’s footprint, and added approximately $225.7 million of deposits and $117.1 million of loans as of December 31, 2024.

​

On June 24, 2025, the Company entered into a Subordinated Note Purchase Agreement with certain institutional accredited investors and qualified institutional buyers pursuant to which the Company sold and issued $80.0 million in aggregate principal amount of its 7.625% Fixed-to-Floating Rate Subordinated Notes due 2035 (the “Notes”). The Notes were issued by the Company to such purchasers at a price equal to 100% of their face amount. The Company used the net proceeds it received from the sale of the Notes to redeem $50 million of outstanding 5.25% Fixed-to-Floating Rate Subordinated Notes due 2030 and for general corporate purposes.

​

On July 4, 2025, the President signed H.R. 1, the “One Big Beautiful Bill Act,” into law. The legislation includes several changes to federal tax law that generally allow for more favorable deductibility of certain business expenses beginning in 2025, including the restoration of immediate expensing of domestic research and development expenditures, reinstatement of 100% bonus depreciation, and more favorable rules for determining the limitation on business interest expense. The financial impact was immaterial to the financial statements.

​

On September 30, 2025, the Company announced its plan to close its Country Village branch location, effective December 29, 2025, given the close proximity to its Glen Lake branch in Minnetonka, Minnesota.

​

Basis of Presentation

The accompanying unaudited consolidated financial statements were prepared in accordance with instructions for Form 10-Q and, therefore, do not include all disclosures necessary for a complete presentation of the consolidated balance sheets, consolidated statements of income, consolidated statements of comprehensive income, consolidated statements of shareholders’ equity and consolidated statements of cash flows in conformity with U.S. generally accepted accounting principles (“GAAP”). However, all normal recurring adjustments which are, in the opinion of management, necessary for the fair presentation of the interim financial statements have been included. The results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of the results which may be expected for the entire year. For further information, refer to the consolidated financial statements and footnotes included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 6, 2025.

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Principles of Consolidation

These consolidated financial statements include the amounts of the Company, the Bank, with locations in Bloomington, Greenwood, Minneapolis (2), Minnetonka (2), Orono, St. Louis Park, and St. Paul, Minnesota, BWB Holdings, LLC, and Bridgewater Investment Management, Inc. All significant intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates in Preparation of Financial Statements

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Information available which could affect judgements includes, but is not limited to, changes in interest rates, changes in the performance of the economy, including elevated levels of inflation and possible recession, and changes in the financial condition of borrowers.

Material estimates that are particularly susceptible to significant change in the near term include the determination of the allowance for credit losses (“ACL”).

Segment Reporting

An operating segment is generally defined as a component of a business for which discrete financial information is available and whose operating results are regularly reviewed by the chief operating decision maker (“CODM”). Substantially all of the Company’s operations involve the delivery of loan and deposit products to clients. The Company’s CODM makes operating decisions and assesses performance based on an ongoing review of the banking activities, which constitute the Company’s only operating segment for financial reporting purposes. The Company’s single segment is managed on a consolidated basis by the CODM who is the Chief Executive Officer.

​

The accounting policies of this segment are the same as those described throughout this Note 1 concerning significant accounting policies. The CODM assesses performance of the segment and determines the appropriate allocation of Company resources based on consolidated net income, which is reported in the Consolidated Statements of Income. Consolidated net income is used in deciding where to deploy capital, and to monitor how budget compares to actual results. It is also used in benchmarking performance measures to Company peers for compensation related analysis. The measure of segment assets is reported on the Consolidated Balance Sheets as total consolidated assets.

​

Impact of Recently Adopted Accounting Guidance

On January 1, 2025, the Company adopted Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic ASC 740) Income Taxes. The ASU improves the transparency of income tax disclosures by requiring (1) consistent categories and greater disaggregation of information in rate reconciliation and (2) disaggregation of income taxes paid by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024. The Company’s adoption of this standard did not have a material impact on the Company’s consolidated financial statements.

​

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Impact of Recently Issued Accounting Standards

​

The following ASU’s have been issued by FASB and may impact the Company’s consolidated financial statements in future reporting periods:

​

On November 4, 2024, the FASB issued ASU 2024-03, which was updated in ASU 2025-01, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40). The ASU requires disclosure of additional information about specific expense categories in the notes to the financial statements. This ASU does not change or remove current expense disclosure requirements, but does affect where this information appears in the notes to the financial statements. The amendments are effective for the first fiscal year period beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. The amendments should be applied on a prospective or a retrospective basis, with an option to early adopt. The Company is currently evaluating the impact of ASU 2024-03 and ASU 2025-01.

​

On September 18, 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The ASU removes all references to a prescriptive and sequential software development method (referred to as “project stages”) throughout Subtopic 350-40. The amendments require an entity to start capitalizing software costs when management has authorized and committed to funding the software project and it is probable that the project will be completed and the software will be used to perform the function intended. The amendments are effective for annual reporting periods beginning after December 15, 2027 and for interim reporting within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period. The Company is currently evaluating the impact of ASU 2025-06.

​

Subsequent Events

​

Subsequent events have been evaluated through October 30, 2025, which is the date the consolidated financial statements were available to be issued.

​

Note 2: Earnings Per Share

Basic earnings per common share are computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted earnings per common share are computed by dividing net income available to common shareholders by the weighted average number of common shares, adjusted for the dilutive effect of stock compensation. For the three and nine months ended September 30, 2025, stock options and restricted stock units totaling 570,500 and 535,450 shares, respectively, were excluded from the calculation because they were deemed to be anti-dilutive. For the three and nine months ended September 30, 2024, stock options and restricted stock units totaling 774,770 and 1,137,208 shares, respectively, were excluded from the calculation because they were deemed to be antidilutive.

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The following table presents the numerators and denominators for basic and diluted earnings per share computations for the three and nine months ended September 30, 2025 and 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
(dollars in thousands, except per share data) |  | 2025 |  | 2024 |  | 2025 |  | 2024
Net Income Available to Common Shareholders | ​ | $ | 10,588 | ​ | $ | 7,662 | ​ | $ | 29,714 | ​ | $ | 21,581
Weighted Average Common Stock Outstanding: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Weighted Average Common Stock Outstanding (Basic) | ​ | ​ | 27,504,840 | ​ | ​ | 27,382,798 | ​ | ​ | 27,511,297 | ​ | ​ | 27,486,590
Dilutive Effect of Stock Compensation | ​ | ​ | 685,566 | ​ | ​ | 522,112 | ​ | ​ | 578,112 | ​ | ​ | 433,194
Weighted Average Common Stock Outstanding (Dilutive) | ​ | ​ | 28,190,406 | ​ | ​ | 27,904,910 | ​ | ​ | 28,089,409 | ​ | ​ | 27,919,784
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Basic Earnings per Common Share | ​ | $ | 0.38 | ​ | $ | 0.28 | ​ | $ | 1.08 | ​ | $ | 0.79
Diluted Earnings per Common Share | ​ | ​ | 0.38 | ​ | ​ | 0.27 | ​ | ​ | 1.06 | ​ | ​ | 0.77

​

​

​

​

Note 3: Securities

The following tables present the amortized cost and estimated fair value of securities with gross unrealized gains and losses at September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025
​ | ​ | ​ | ​ | ​ | Gross | ​ | Gross | ​ | ​ | ​
​ | ​ | Amortized | ​ | Unrealized | ​ | Unrealized | ​ | ​ | ​
(dollars in thousands) |  | Cost |  | Gains |  | Losses |  | Fair Value
Securities Available for Sale: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
U.S. Treasury Securities | ​ | $ | 155,902 | ​ | $ | — | ​ | $ | (8,703) | ​ | $ | 147,199
Municipal Bonds | ​ | ​ | 247,471 | ​ | ​ | 6,614 | ​ | ​ | (13,538) | ​ | ​ | 240,547
Mortgage-Backed Securities | ​ |  | 267,171 | ​ |  | 2,877 | ​ |  | (10,899) | ​ |  | 259,149
Corporate Securities | ​ |  | 109,613 | ​ | ​ | 1,791 | ​ | ​ | (3,421) | ​ |  | 107,983
U.S Government Agency Securities | ​ |  | 9,803 | ​ | ​ | 73 | ​ | ​ | (41) | ​ | ​ | 9,835
Asset-Backed Securities | ​ | ​ | 61,687 | ​ | ​ | 92 | ​ | ​ | (19) | ​ | ​ | 61,760
Total Securities Available for Sale | ​ | $ | 851,647 | ​ | $ | 11,447 | ​ | $ | (36,621) | ​ | $ | 826,473

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | December 31, 2024
​ | ​ | ​ | ​ | ​ | Gross | ​ | Gross | ​ | ​ | ​
​ | ​ | Amortized | ​ | Unrealized | ​ | Unrealized | ​ | ​ | ​
(dollars in thousands) |  | Cost |  | Gains |  | Losses |  | Fair Value
Securities Available for Sale: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
U.S. Treasury Securities | ​ | $ | 179,835 | ​ | $ | 3 | ​ | $ | (12,090) | ​ | $ | 167,748
Municipal Bonds | ​ | ​ | 139,891 | ​ | ​ | 23 | ​ | ​ | (17,649) | ​ | ​ | 122,265
Mortgage-Backed Securities | ​ |  | 259,833 | ​ |  | 882 | ​ |  | (15,825) | ​ |  | 244,890
Corporate Securities | ​ |  | 139,161 | ​ | ​ | 1,041 | ​ | ​ | (6,016) | ​ |  | 134,186
U.S Government Agency Securities | ​ |  | 22,053 | ​ | ​ | 85 | ​ | ​ | (56) | ​ | ​ | 22,082
Asset-Backed Securities | ​ | ​ | 76,891 | ​ | ​ | 211 | ​ | ​ | (26) | ​ | ​ | 77,076
Total Securities Available for Sale | ​ | $ | 817,664 | ​ | $ | 2,245 | ​ | $ | (51,662) | ​ | $ | 768,247

​

Securities with a carrying value of $264.9 million and $289.9 million were pledged to secure borrowing capacity at the Federal Reserve Discount Window as of September 30, 2025 and December 31, 2024, respectively.

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The following tables present the fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at September 30, 2025 and December 31, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Less Than 12 Months | ​ | 12 Months or Greater | ​ | Total
​ | ​ | Number of | ​ | ​ | ​ | ​ | Unrealized | ​ | ​ | ​ | ​ | Unrealized | ​ | ​ | ​ | ​ | Unrealized
(dollars in thousands, except number of holdings) |  | Holdings |  | Fair Value |  | Losses |  | Fair Value |  | Losses |  | Fair Value |  | Losses
September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
U.S. Treasury Securities | ​ | 2 | ​ | $ | — | ​ | $ | — | ​ | $ | 147,199 | ​ | $ | (8,703) | ​ | $ | 147,199 | ​ | $ | (8,703)
Municipal Bonds | ​ | 191 | ​ | ​ | 19,961 | ​ | ​ | (654) | ​ | ​ | 95,294 | ​ | ​ | (12,884) | ​ | ​ | 115,255 | ​ | ​ | (13,538)
Mortgage-Backed Securities | ​ | 113 | ​ | ​ | 10,653 | ​ | ​ | (47) | ​ | ​ | 115,179 | ​ | ​ | (10,852) | ​ |  | 125,832 | ​ |  | (10,899)
Corporate Securities | ​ | 51 | ​ | ​ | 5,366 | ​ | ​ | (49) | ​ | ​ | 47,728 | ​ | ​ | (3,372) | ​ |  | 53,094 | ​ |  | (3,421)
U.S Government Agency Securities | ​ | 31 | ​ | ​ | 1,279 | ​ | ​ | (5) | ​ | ​ | 2,470 | ​ | ​ | (36) | ​ |  | 3,749 | ​ |  | (41)
Asset-Backed Securities | ​ | 7 | ​ | ​ | 10,035 | ​ | ​ | (13) | ​ | ​ | 6,899 | ​ | ​ | (6) | ​ | ​ | 16,934 | ​ | ​ | (19)
Total Securities Available for Sale | ​ | 395 | ​ | $ | 47,294 | ​ | $ | (768) | ​ | $ | 414,769 | ​ | $ | (35,853) | ​ | $ | 462,063 | ​ | $ | (36,621)

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Less Than 12 Months | ​ | 12 Months or Greater | ​ | Total
​ | ​ | Number of | ​ | ​ | ​ | ​ | Unrealized | ​ | ​ | ​ | ​ | Unrealized | ​ | ​ | ​ | ​ | Unrealized
(dollars in thousands, except number of holdings) |  | Holdings |  | Fair Value |  | Losses |  | Fair Value |  | Losses |  | Fair Value |  | Losses
December 31, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
U.S. Treasury Securities | ​ | 14 | ​ | $ | 157,091 | ​ | $ | (12,090) | ​ | $ | — | ​ | $ | — | ​ | $ | 157,091 | ​ | $ | (12,090)
Municipal Bonds | ​ | 236 | ​ | ​ | 21,329 | ​ | ​ | (120) | ​ | ​ | 95,774 | ​ | ​ | (17,529) | ​ | ​ | 117,103 | ​ | ​ | (17,649)
Mortgage-Backed Securities | ​ | 168 | ​ | ​ | 47,636 | ​ | ​ | (391) | ​ | ​ | 118,824 | ​ | ​ | (15,434) | ​ |  | 166,460 | ​ |  | (15,825)
Corporate Securities | ​ | 93 | ​ | ​ | 6,860 | ​ | ​ | (75) | ​ | ​ | 91,666 | ​ | ​ | (5,941) | ​ |  | 98,526 | ​ |  | (6,016)
U.S Government Agency Securities | ​ | 38 | ​ | ​ | 5,878 | ​ | ​ | (5) | ​ | ​ | 4,071 | ​ | ​ | (51) | ​ |  | 9,949 | ​ |  | (56)
Asset-Backed Securities | ​ | 7 | ​ | ​ | 5,735 | ​ | ​ | (5) | ​ | ​ | 10,161 | ​ | ​ | (21) | ​ | ​ | 15,896 | ​ | ​ | (26)
Total Securities Available for Sale | ​ | 556 | ​ | $ | 244,529 | ​ | $ | (12,686) | ​ | $ | 320,496 | ​ | $ | (38,976) | ​ | $ | 565,025 | ​ | $ | (51,662)

​

At September 30, 2025, 395 debt securities had unrealized losses with aggregate depreciation of approximately 7.3% from the Company’s amortized cost basis. At December 31, 2024, 556 debt securities had unrealized losses with aggregate depreciation of approximately 8.4% from the Company’s amortized cost basis. These unrealized losses have not been recognized into income because management does not intend to sell these securities, and it is not more likely than not it will be required to sell the securities before recovery of its amortized cost basis. Furthermore, the unrealized losses are due to changes in interest rates and other market conditions and were not reflective of credit events. To make this determination, consideration is given to such factors as the credit rating of the issuer, level of credit enhancement, changes in credit ratings, market conditions such as current interest rates, any adverse conditions specific to the security, and delinquency status on contractual payments. As of September 30, 2025 and December 31, 2024, there was no allowance for credit losses carried on the Company’s securities portfolio.

​

Accrued interest receivable on securities, which is recorded within accrued interest on the balance sheet, totaled $7.0 million and $6.2 million at September 30, 2025 and December 31, 2024, respectively, and was excluded from the estimate of credit losses.

​

The Company has entered into a fair value hedging transaction to mitigate the impact of changing interest rates on the fair value of U.S. treasury securities and mortgage-backed securities. See Note 7 – Derivative Instruments and Hedging Activities for disclosure of the gains and losses recognized on derivative instruments and the cumulative fair value hedging adjustments to the carrying amount of the hedged securities.

​

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The following table presents a summary of the amortized cost and estimated fair value of debt securities by the earlier of expected call date or contractual maturity as of September 30, 2025. Call date is used when a call of the debt security is expected, as determined by the Company when the security has a market value above its amortized cost. Contractual maturities will differ from expected maturities for mortgage-backed, U.S. government agency securities and asset-backed securities because borrowers may have the right to call or prepay obligations without penalties.

​

​ | ​ | ​ | ​ | ​ | ​ | ​
(dollars in thousands) |  | Amortized Cost |  | Fair Value
September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​
Due in One Year or Less | ​ | $ | 42,029 | ​ | $ | 42,814
Due After One Year Through Five Years | ​ |  | 130,801 | ​ |  | 134,703
Due After Five Years Through 10 Years | ​ |  | 152,428 | ​ |  | 142,107
Due After 10 Years | ​ |  | 187,728 | ​ |  | 176,105
Subtotal | ​ |  | 512,986 | ​ |  | 495,729
Mortgage-Backed Securities | ​ |  | 267,171 | ​ |  | 259,149
U.S Government Agency Securities | ​ |  | 9,803 | ​ |  | 9,835
Asset-Backed Securities | ​ | ​ | 61,687 | ​ | ​ | 61,760
Totals | ​ | $ | 851,647 | ​ | $ | 826,473

​

The following table presents a summary of the proceeds from sales of securities available for sale, as well as gross gains and losses, for the three and nine months ended September 30, 2025 and 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
(dollars in thousands) |  | 2025 |  | 2024 |  | 2025 |  | 2024
Proceeds From Sales of Securities | ​ | $ | 5,112 | ​ | $ | 50,779 | ​ | $ | 64,707 | ​ | $ | 101,612
Gross Gains on Sales | ​ |  | 59 | ​ |  | 488 | ​ |  | 543 | ​ |  | 1,594
Gross Losses on Sales | ​ |  | — | ​ |  | (516) | ​ |  | (9) | ​ |  | (1,209)

​

​

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Note 4: Loans and Allowance for Credit Losses

The following table presents the components of the loan portfolio at September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, | ​ | December 31,
(dollars in thousands) |  | 2025 |  | 2024
Commercial | ​ | $ | 533,476 | ​ | $ | 497,662
Leases | ​ | ​ | 43,186 | ​ | ​ | 44,291
Construction and Land Development | ​ |  | 159,991 | ​ |  | 97,255
1-4 Family Construction | ​ | ​ | 41,739 | ​ | ​ | 41,961
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​
1-4 Family Mortgage | ​ |  | 487,297 | ​ |  | 474,383
Multifamily | ​ |  | 1,578,223 | ​ |  | 1,425,610
CRE Owner Occupied | ​ | ​ | 192,966 | ​ | ​ | 191,248
CRE Nonowner Occupied | ​ | ​ | 1,158,622 | ​ | ​ | 1,083,108
Total Real Estate Mortgage Loans | ​ | ​ | 3,417,108 | ​ | ​ | 3,174,349
Consumer and Other | ​ | ​ | 19,054 | ​ | ​ | 12,996
Total Loans, Gross | ​ |  | 4,214,554 | ​ |  | 3,868,514
Allowance for Credit Losses | ​ |  | (56,390) | ​ |  | (52,277)
Net Deferred Loan Fees | ​ |  | (8,282) | ​ |  | (6,801)
Total Loans, Net | ​ | $ | 4,149,882 | ​ | $ | 3,809,436

​

The following tables present the aging in past due loans and loans on nonaccrual status, with and without an ACL by loan segment, as of September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Accruing Interest | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | 30-89 Days | ​ | 90 Days or | ​ | Nonaccrual | ​ | Nonaccrual | ​ | ​ | ​
(dollars in thousands) |  | Current |  | Past Due |  | More Past Due |  | with ACL |  | without ACL |  | Total
September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | 532,193 | ​ | $ | — | ​ | $ | — | ​ | $ | 1,250 | ​ | $ | 33 | ​ | $ | 533,476
Leases | ​ | ​ | 43,167 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 19 | ​ | ​ | 43,186
Construction and Land Development | ​ |  | 159,951 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 40 | ​ |  | 159,991
1-4 Family Construction | ​ | ​ | 41,739 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 41,739
Real Estate Mortgage: | ​ |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |  | ​
1-4 Family Mortgage | ​ |  | 486,980 | ​ | ​ | 317 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ |  | 487,297
Multifamily | ​ |  | 1,578,223 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ |  | 1,578,223
CRE Owner Occupied | ​ |  | 191,218 | ​ | ​ | 1,748 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ |  | 192,966
CRE Nonowner Occupied | ​ |  | 1,149,973 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 8,649 | ​ | ​ | — | ​ |  | 1,158,622
Consumer and Other | ​ |  | 18,213 | ​ | ​ | 841 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ |  | 19,054
Totals | ​ | $ | 4,201,657 | ​ | $ | 2,906 | ​ | $ | — | ​ | $ | 9,899 | ​ | $ | 92 | ​ | $ | 4,214,554

​

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​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Accruing Interest | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | 30-89 Days | ​ | 90 Days or | ​ | Nonaccrual | ​ | Nonaccrual | ​ | ​ | ​
(dollars in thousands) |  | Current |  | Past Due |  | More Past Due |  | with ACL |  | without ACL |  | Total
December 31, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | 497,432 | ​ | $ | 59 | ​ | $ | — | ​ | $ | 171 | ​ | $ | — | ​ | $ | 497,662
Leases | ​ | ​ | 44,257 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 34 | ​ | ​ | — | ​ | ​ | 44,291
Construction and Land Development | ​ |  | 97,197 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 58 | ​ | ​ | 97,255
1-4 Family Construction | ​ | ​ | 41,961 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 41,961
Real Estate Mortgage: | ​ |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
1-4 Family Mortgage | ​ |  | 474,185 | ​ | ​ | 178 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 20 | ​ | ​ | 474,383
Multifamily | ​ |  | 1,425,610 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 1,425,610
CRE Owner Occupied | ​ |  | 190,197 | ​ | ​ | 1,051 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 191,248
CRE Nonowner Occupied | ​ |  | 1,083,108 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 1,083,108
Consumer and Other | ​ |  | 12,975 | ​ | ​ | 3 | ​ | ​ | — | ​ | ​ | 18 | ​ | ​ | — | ​ | ​ | 12,996
Totals | ​ | $ | 3,866,922 | ​ | $ | 1,291 | ​ | $ | — | ​ | $ | 223 | ​ | $ | 78 | ​ | $ | 3,868,514

​

The Company aggregates loans into credit quality indicators based on relevant information about the ability of borrowers to service their debt by using internal reviews in which management monitors and analyzes the financial condition of borrowers and guarantors, trends in the industries in which the borrowers operate, and the fair values of collateral securing the loans. The Company analyzes all loans individually to assign a risk rating, grouped into six major categories defined as follows:

​

Pass: A pass loan is a credit with no known or existing potential weaknesses deserving of management’s close attention.

Watch: Loans classified as watch have a credit where the borrower’s financial strength and performance has

been declining and may pose an elevated level of risk. Watch loans have been identified as having minor deterioration in loan quality or other credit weaknesses/circumstances meriting closer attention of management.

​

Special Mention: Loans classified as special mention have a potential weakness that deserves management’s

close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the Company’s credit position at some future date. Special mention loans are not adversely classified and do not expose the Company to sufficient risk to warrant adverse classification. This is a transitional rating and loans should not be classified as special mention for more than one year.

​

Substandard: Loans classified as substandard are not adequately protected by the current net worth and paying capacity of the borrower or of the collateral pledged, if any. Loans classified as substandard have a well-defined weakness or weaknesses that jeopardize the repayment of the debt. Well defined weaknesses include a borrower’s lack of marketability, inadequate cash flow or collateral support, failure to complete construction on time, or the failure to fulfill economic expectations. They are characterized by the distinct possibility that the Company will sustain loss if the deficiencies are not corrected.

​

Doubtful: Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or repayment in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loss: Loans classified as loss are considered uncollectible and charged-off immediately.

15

Table of Contents

The following tables present loan balances classified by credit quality indicators by year of origination as of September 30, 2025 and December 31, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025
(dollars in thousands) | ​ | 2025 | ​ | ​ | 2024 | ​ | ​ | 2023 | ​ | ​ | 2022 | ​ | ​ | 2021 | ​ | ​ | Prior | ​ | ​ | Revolving | ​ | ​ | Total
Commercial | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | $ | 127,366 | ​ | $ | 88,485 | ​ | $ | 29,477 | ​ | $ | 57,803 | ​ | $ | 16,507 | ​ | $ | 27,330 | ​ | $ | 170,940 | ​ | $ | 517,908
Watch/Special Mention | ​ | 94 | ​ | ​ | — | ​ | ​ | 610 | ​ | ​ | 164 | ​ | ​ | — | ​ | ​ | 8 | ​ | ​ | 555 | ​ | ​ | 1,431
Substandard | ​ | 110 | ​ | ​ | 142 | ​ | ​ | 1,306 | ​ | ​ | 10,380 | ​ | ​ | 9 | ​ | ​ | — | ​ | ​ | 2,190 | ​ | ​ | 14,137
Total Commercial | ​ | 127,570 | ​ | ​ | 88,627 | ​ | ​ | 31,393 | ​ | ​ | 68,347 | ​ | ​ | 16,516 | ​ | ​ | 27,338 | ​ | ​ | 173,685 | ​ | ​ | 533,476
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | 10 | ​ | ​ | 58 | ​ | ​ | 186 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 254
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Leases | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 11,963 | ​ | ​ | 12,035 | ​ | ​ | 9,356 | ​ | ​ | 6,292 | ​ | ​ | 2,151 | ​ | ​ | 1,370 | ​ | ​ | — | ​ | ​ | 43,167
Substandard | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 19 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 19
Total Leases | ​ | 11,963 | ​ | ​ | 12,035 | ​ | ​ | 9,356 | ​ | ​ | 6,311 | ​ | ​ | 2,151 | ​ | ​ | 1,370 | ​ | ​ | — | ​ | ​ | 43,186
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 15 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 15
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Construction and Land Development | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 84,744 | ​ | ​ | 60,287 | ​ | ​ | 1,604 | ​ | ​ | 337 | ​ | ​ | 434 | ​ | ​ | — | ​ | ​ | 12,545 | ​ | ​ | 159,951
Substandard | ​ | — | ​ | ​ | 40 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 40
Total Construction and Land Development | ​ | 84,744 | ​ | ​ | 60,327 | ​ | ​ | 1,604 | ​ | ​ | 337 | ​ | ​ | 434 | ​ | ​ | — | ​ | ​ | 12,545 | ​ | ​ | 159,991
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
1-4 Family Construction | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 20,093 | ​ | ​ | 9,104 | ​ | ​ | 227 | ​ | ​ | 201 | ​ | ​ | 187 | ​ | ​ | — | ​ | ​ | 11,927 | ​ | ​ | 41,739
Total 1-4 Family Construction | ​ | 20,093 | ​ | ​ | 9,104 | ​ | ​ | 227 | ​ | ​ | 201 | ​ | ​ | 187 | ​ | ​ | — | ​ | ​ | 11,927 | ​ | ​ | 41,739
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Real Estate Mortgage: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
1-4 Family Mortgage | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 71,539 | ​ | ​ | 73,348 | ​ | ​ | 47,161 | ​ | ​ | 90,200 | ​ | ​ | 68,477 | ​ | ​ | 56,564 | ​ | ​ | 78,865 | ​ | ​ | 486,154
Substandard | ​ | 633 | ​ | ​ | — | ​ | ​ | 193 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 317 | ​ | ​ | — | ​ | ​ | 1,143
Total 1-4 Family Mortgage | ​ | 72,172 | ​ | ​ | 73,348 | ​ | ​ | 47,354 | ​ | ​ | 90,200 | ​ | ​ | 68,477 | ​ | ​ | 56,881 | ​ | ​ | 78,865 | ​ | ​ | 487,297
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Multifamily | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 285,418 | ​ | ​ | 189,795 | ​ | ​ | 128,257 | ​ | ​ | 428,087 | ​ | ​ | 321,394 | ​ | ​ | 157,685 | ​ | ​ | 9,677 | ​ | ​ | 1,520,313
Watch/Special Mention | ​ | 31,841 | ​ | ​ | — | ​ | ​ | 2,213 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 34,054
Substandard | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 10,561 | ​ | ​ | — | ​ | ​ | 13,295 | ​ | ​ | — | ​ | ​ | 23,856
Total Multifamily | ​ | 317,259 | ​ | ​ | 189,795 | ​ | ​ | 130,470 | ​ | ​ | 438,648 | ​ | ​ | 321,394 | ​ | ​ | 170,980 | ​ | ​ | 9,677 | ​ | ​ | 1,578,223
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
CRE Owner Occupied | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 19,712 | ​ | ​ | 21,034 | ​ | ​ | 25,716 | ​ | ​ | 59,371 | ​ | ​ | 29,689 | ​ | ​ | 27,775 | ​ | ​ | 1,955 | ​ | ​ | 185,252
Watch/Special Mention | ​ | — | ​ | ​ | 563 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 436 | ​ | ​ | 2,191 | ​ | ​ | 1,832 | ​ | ​ | 5,022
Substandard | ​ | 152 | ​ | ​ | — | ​ | ​ | 792 | ​ | ​ | — | ​ | ​ | 1,748 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 2,692
Total CRE Owner Occupied | ​ | 19,864 | ​ | ​ | 21,597 | ​ | ​ | 26,508 | ​ | ​ | 59,371 | ​ | ​ | 31,873 | ​ | ​ | 29,966 | ​ | ​ | 3,787 | ​ | ​ | 192,966
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
CRE Nonowner Occupied | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 262,084 | ​ | ​ | 316,755 | ​ | ​ | 91,792 | ​ | ​ | 219,899 | ​ | ​ | 127,344 | ​ | ​ | 120,235 | ​ | ​ | 4,191 | ​ | ​ | 1,142,300
Watch/Special Mention | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 135 | ​ | ​ | — | ​ | ​ | 135
Substandard | ​ | 15,283 | ​ | ​ | 904 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 16,187
Total CRE Nonowner Occupied | ​ | 277,367 | ​ | ​ | 317,659 | ​ | ​ | 91,792 | ​ | ​ | 219,899 | ​ | ​ | 127,344 | ​ | ​ | 120,370 | ​ | ​ | 4,191 | ​ | ​ | 1,158,622
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Real Estate Mortgage Loans | ​ | 686,662 | ​ | ​ | 602,399 | ​ | ​ | 296,124 | ​ | ​ | 808,118 | ​ | ​ | 549,088 | ​ | ​ | 378,197 | ​ | ​ | 96,520 | ​ | ​ | 3,417,108
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Consumer and Other | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 2,910 | ​ | ​ | 234 | ​ | ​ | 397 | ​ | ​ | 325 | ​ | ​ | 59 | ​ | ​ | 1,116 | ​ | ​ | 14,013 | ​ | ​ | 19,054
Total Consumer and Other | ​ | 2,910 | ​ | ​ | 234 | ​ | ​ | 397 | ​ | ​ | 325 | ​ | ​ | 59 | ​ | ​ | 1,116 | ​ | ​ | 14,013 | ​ | ​ | 19,054
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 25 | ​ | ​ | 25
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | 10 | ​ | ​ | 73 | ​ | ​ | 186 | ​ | ​ | — | ​ | ​ | 25 | ​ | ​ | 294
Total Loans | $ | 933,942 | ​ | $ | 772,726 | ​ | $ | 339,101 | ​ | $ | 883,639 | ​ | $ | 568,435 | ​ | $ | 408,021 | ​ | $ | 308,690 | ​ | $ | 4,214,554

16

Table of Contents

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | December 31, 2024
(dollars in thousands) | ​ | 2024 | ​ | ​ | 2023 | ​ | ​ | 2022 | ​ | ​ | 2021 | ​ | ​ | 2020 | ​ | ​ | Prior | ​ | ​ | Revolving | ​ | ​ | Total
Commercial | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | $ | 135,665 | ​ | $ | 45,089 | ​ | $ | 67,579 | ​ | $ | 23,353 | ​ | $ | 13,349 | ​ | $ | 19,794 | ​ | $ | 178,293 | ​ | $ | 483,122
Watch/Special Mention | ​ | — | ​ | ​ | — | ​ | ​ | 76 | ​ | ​ | 96 | ​ | ​ | 29 | ​ | ​ | — | ​ | ​ | 1,716 | ​ | ​ | 1,917
Substandard | ​ | 110 | ​ | ​ | 44 | ​ | ​ | 10,491 | ​ | ​ | — | ​ | ​ | 65 | ​ | ​ | — | ​ | ​ | 1,913 | ​ | ​ | 12,623
Total Commercial | ​ | 135,775 | ​ | ​ | 45,133 | ​ | ​ | 78,146 | ​ | ​ | 23,449 | ​ | ​ | 13,443 | ​ | ​ | 19,794 | ​ | ​ | 181,922 | ​ | ​ | 497,662
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Leases | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 15,128 | ​ | ​ | 12,684 | ​ | ​ | 9,736 | ​ | ​ | 4,057 | ​ | ​ | 1,504 | ​ | ​ | 1,148 | ​ | ​ | — | ​ | ​ | 44,257
Substandard | ​ | — | ​ | ​ | — | ​ | ​ | 34 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 34
Total Leases | ​ | 15,128 | ​ | ​ | 12,684 | ​ | ​ | 9,770 | ​ | ​ | 4,057 | ​ | ​ | 1,504 | ​ | ​ | 1,148 | ​ | ​ | — | ​ | ​ | 44,291
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 11 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 11
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Construction and Land Development | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 74,967 | ​ | ​ | 6,027 | ​ | ​ | 6,791 | ​ | ​ | 585 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 8,827 | ​ | ​ | 97,197
Substandard | ​ | 58 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 58
Total Construction and Land Development | ​ | 75,025 | ​ | ​ | 6,027 | ​ | ​ | 6,791 | ​ | ​ | 585 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 8,827 | ​ | ​ | 97,255
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
1-4 Family Construction | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 29,378 | ​ | ​ | 488 | ​ | ​ | 1,164 | ​ | ​ | 363 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 10,568 | ​ | ​ | 41,961
Total 1-4 Family Construction | ​ | 29,378 | ​ | ​ | 488 | ​ | ​ | 1,164 | ​ | ​ | 363 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 10,568 | ​ | ​ | 41,961
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Real Estate Mortgage: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
1-4 Family Mortgage | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 89,561 | ​ | ​ | 58,054 | ​ | ​ | 102,627 | ​ | ​ | 77,293 | ​ | ​ | 55,936 | ​ | ​ | 18,289 | ​ | ​ | 71,097 | ​ | ​ | 472,857
Watch/Special Mention | ​ | 298 | ​ | ​ | 196 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 324 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 818
Substandard | ​ | 20 | ​ | ​ | 45 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 643 | ​ | ​ | — | ​ | ​ | 708
Total 1-4 Family Mortgage | ​ | 89,879 | ​ | ​ | 58,295 | ​ | ​ | 102,627 | ​ | ​ | 77,293 | ​ | ​ | 56,260 | ​ | ​ | 18,932 | ​ | ​ | 71,097 | ​ | ​ | 474,383
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Multifamily | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 219,162 | ​ | ​ | 133,916 | ​ | ​ | 486,854 | ​ | ​ | 336,859 | ​ | ​ | 161,626 | ​ | ​ | 57,679 | ​ | ​ | 6,624 | ​ | ​ | 1,402,720
Watch/Special Mention | ​ | 9,953 | ​ | ​ | 2,245 | ​ | ​ | 10,692 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 22,890
Total Multifamily | ​ | 229,115 | ​ | ​ | 136,161 | ​ | ​ | 497,546 | ​ | ​ | 336,859 | ​ | ​ | 161,626 | ​ | ​ | 57,679 | ​ | ​ | 6,624 | ​ | ​ | 1,425,610
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
CRE Owner Occupied | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 22,761 | ​ | ​ | 31,402 | ​ | ​ | 62,522 | ​ | ​ | 34,228 | ​ | ​ | 17,801 | ​ | ​ | 15,355 | ​ | ​ | 2,121 | ​ | ​ | 186,190
Watch/Special Mention | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 1,759 | ​ | ​ | 1,739 | ​ | ​ | — | ​ | ​ | 593 | ​ | ​ | 4,091
Substandard | ​ | — | ​ | ​ | 967 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 967
Total CRE Owner Occupied | ​ | 22,761 | ​ | ​ | 32,369 | ​ | ​ | 62,522 | ​ | ​ | 35,987 | ​ | ​ | 19,540 | ​ | ​ | 15,355 | ​ | ​ | 2,714 | ​ | ​ | 191,248
Current Period Gross Write-offs | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
CRE Nonowner Occupied | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 356,582 | ​ | ​ | 113,973 | ​ | ​ | 261,827 | ​ | ​ | 148,866 | ​ | ​ | 73,300 | ​ | ​ | 97,350 | ​ | ​ | 6,962 | ​ | ​ | 1,058,860
Watch/Special Mention | ​ | 9,622 | ​ | ​ | 3,659 | ​ | ​ | — | ​ | ​ | 2,690 | ​ | ​ | — | ​ | ​ | 894 | ​ | ​ | — | ​ | ​ | 16,865
Substandard | ​ | 7,261 | ​ | ​ | 122 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 7,383
Total CRE Nonowner Occupied | ​ | 373,465 | ​ | ​ | 117,754 | ​ | ​ | 261,827 | ​ | ​ | 151,556 | ​ | ​ | 73,300 | ​ | ​ | 98,244 | ​ | ​ | 6,962 | ​ | ​ | 1,083,108
Current Period Gross Write-offs | ​ | 1,236 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 1,236
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Real Estate Mortgage Loans | ​ | 715,220 | ​ | ​ | 344,579 | ​ | ​ | 924,522 | ​ | ​ | 601,695 | ​ | ​ | 310,726 | ​ | ​ | 190,210 | ​ | ​ | 87,397 | ​ | ​ | 3,174,349
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Consumer and Other | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pass | ​ | 921 | ​ | ​ | 3,061 | ​ | ​ | 498 | ​ | ​ | 157 | ​ | ​ | 1,301 | ​ | ​ | 5 | ​ | ​ | 7,035 | ​ | ​ | 12,978
Substandard | ​ | — | ​ | ​ | 18 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 18
Total Consumer and Other | ​ | 921 | ​ | ​ | 3,079 | ​ | ​ | 498 | ​ | ​ | 157 | ​ | ​ | 1,301 | ​ | ​ | 5 | ​ | ​ | 7,035 | ​ | ​ | 12,996
Current Period Gross Write-offs | ​ | 17 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 2 | ​ | ​ | 19
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Period Gross Write-offs | ​ | 1,253 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 11 | ​ | ​ | — | ​ | ​ | 2 | ​ | ​ | 1,266
Total Loans | $ | 971,447 | ​ | $ | 411,990 | ​ | $ | 1,020,891 | ​ | $ | 630,306 | ​ | $ | 326,974 | ​ | $ | 211,157 | ​ | $ | 295,749 | ​ | $ | 3,868,514

​

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The following tables present the activity in the ACL, by segment, for the three and nine months ended September 30, 2025 and 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | Provision for | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | (Recovery of) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | Credit Losses | ​ | Loans and | ​ | Recoveries | ​ | Total Ending
​ | ​ | Beginning | ​ | for Loans | ​ | Leases | ​ | of Loans | ​ | Allowance
(dollars in thousands) |  | Balance | ​ | and Leases | ​ | Charged-off | ​ | and Leases | ​ | Balance
Three Months Ended September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | 5,935 | ​ | $ | 1,112 | ​ | $ | (254) | ​ | $ | — | ​ | $ | 6,793
Leases | ​ | ​ | 381 | ​ | ​ | 52 | ​ | ​ | (15) | ​ | ​ | — | ​ | ​ | 418
Construction and Land Development | ​ |  | 1,104 | ​ |  | 176 | ​ |  | — | ​ |  | — | ​ |  | 1,280
1-4 Family Construction | ​ | ​ | 278 | ​ | ​ | 16 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 294
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​
1-4 Family Mortgage | ​ |  | 2,413 | ​ |  | 19 | ​ |  | — | ​ |  | — | ​ |  | 2,432
Multifamily | ​ |  | 23,921 | ​ |  | (691) | ​ |  | — | ​ |  | — | ​ |  | 23,230
CRE Owner Occupied | ​ | ​ | 1,137 | ​ | ​ | (25) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 1,112
CRE Nonowner Occupied | ​ | ​ | 20,443 | ​ | ​ | 207 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 20,650
Total Real Estate Mortgage Loans | ​ | ​ | 47,914 | ​ | ​ | (490) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 47,424
Consumer and Other | ​ | ​ | 153 | ​ | ​ | 34 | ​ | ​ | (7) | ​ | ​ | 1 | ​ | ​ | 181
Total | ​ | $ | 55,765 | ​ | $ | 900 | ​ | $ | (276) | ​ | $ | 1 | ​ | $ | 56,390
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Nine Months Ended September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | 5,630 | ​ | $ | 1,416 | ​ | $ | (254) | ​ | $ | 1 | ​ | $ | 6,793
Leases | ​ | ​ | 368 | ​ | ​ | 65 | ​ | ​ | (15) | ​ | ​ | — | ​ | ​ | 418
Construction and Land Development | ​ |  | 866 | ​ |  | 414 | ​ |  | — | ​ |  | — | ​ |  | 1,280
1-4 Family Construction | ​ | ​ | 331 | ​ | ​ | (37) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 294
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​
1-4 Family Mortgage | ​ |  | 2,795 | ​ |  | (363) | ​ |  | — | ​ |  | — | ​ |  | 2,432
Multifamily | ​ |  | 23,120 | ​ |  | 110 | ​ |  | — | ​ |  | — | ​ |  | 23,230
CRE Owner Occupied | ​ | ​ | 1,290 | ​ | ​ | (178) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 1,112
CRE Nonowner Occupied | ​ | ​ | 17,735 | ​ | ​ | 2,915 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 20,650
Total Real Estate Mortgage Loans | ​ | ​ | 44,940 | ​ | ​ | 2,484 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 47,424
Consumer and Other | ​ | ​ | 142 | ​ | ​ | 58 | ​ | ​ | (25) | ​ | ​ | 6 | ​ | ​ | 181
Total | ​ | $ | 52,277 | ​ | $ | 4,400 | ​ | $ | (294) | ​ | $ | 7 | ​ | $ | 56,390

​

18

Table of Contents

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | Provision for | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | (Recovery of) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | Credit Losses | ​ | Loans and | ​ | Recoveries | ​ | Total Ending
​ | ​ | Beginning | ​ | for Loans | ​ | Leases | ​ | of Loans | ​ | Allowance
(dollars in thousands) |  | Balance | ​ | and Leases | ​ | Charged-off | ​ | and Leases | ​ | Balance
Three Months Ended September 30, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | 6,018 | ​ | $ | (350) | ​ | $ | — | ​ | $ | 5 | ​ | $ | 5,673
Construction and Land Development | ​ |  | 1,220 | ​ |  | (141) | ​ |  | — | ​ |  | — | ​ |  | 1,079
1-4 Family Construction | ​ | ​ | 522 | ​ | ​ | (128) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 394
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​
1-4 Family Mortgage | ​ |  | 2,774 | ​ |  | 5 | ​ |  | — | ​ |  | — | ​ |  | 2,779
Multifamily | ​ |  | 22,480 | ​ |  | (125) | ​ |  | — | ​ |  | — | ​ |  | 22,355
CRE Owner Occupied | ​ | ​ | 1,258 | ​ | ​ | (25) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 1,233
CRE Nonowner Occupied | ​ | ​ | 17,581 | ​ | ​ | 730 | ​ | ​ | (935) | ​ | ​ | — | ​ | ​ | 17,376
Total Real Estate Mortgage Loans | ​ | ​ | 44,093 | ​ | ​ | 585 | ​ | ​ | (935) | ​ | ​ | — | ​ | ​ | 43,743
Consumer and Other | ​ | ​ | 96 | ​ | ​ | 34 | ​ | ​ | (2) | ​ | ​ | 1 | ​ | ​ | 129
Total | ​ | $ | 51,949 | ​ | $ | — | ​ | $ | (937) | ​ | $ | 6 | ​ | $ | 51,018
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Nine Months Ended September 30, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | 5,398 | ​ | $ | 265 | ​ | $ | — | ​ | $ | 10 | ​ | $ | 5,673
Construction and Land Development | ​ |  | 2,156 | ​ |  | (1,077) | ​ |  | — | ​ |  | — | ​ |  | 1,079
1-4 Family Construction | ​ | ​ | 558 | ​ | ​ | (164) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 394
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​
1-4 Family Mortgage | ​ |  | 2,651 | ​ |  | 125 | ​ |  | — | ​ |  | 3 | ​ |  | 2,779
Multifamily | ​ |  | 22,217 | ​ |  | 138 | ​ |  | — | ​ |  | — | ​ |  | 22,355
CRE Owner Occupied | ​ | ​ | 1,184 | ​ | ​ | 49 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 1,233
CRE Nonowner Occupied | ​ | ​ | 16,225 | ​ | ​ | 2,086 | ​ | ​ | (935) | ​ | ​ | — | ​ | ​ | 17,376
Total Real Estate Mortgage Loans | ​ | ​ | 42,277 | ​ | ​ | 2,398 | ​ | ​ | (935) | ​ | ​ | 3 | ​ | ​ | 43,743
Consumer and Other | ​ | ​ | 105 | ​ | ​ | 28 | ​ | ​ | (14) | ​ | ​ | 10 | ​ | ​ | 129
Total | ​ | $ | 50,494 | ​ | $ | 1,450 | ​ | $ | (949) | ​ | $ | 23 | ​ | $ | 51,018

​

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The following tables present the balance in the ACL and the recorded investment in loans, by segment, as of September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Individually | ​ | Collectively | ​ | ​ | ​
​ | ​ | Evaluated for | ​ | Evaluated for | ​ | ​ | ​
(dollars in thousands) |  | Credit Loss | ​ | Credit Loss | ​ | Total
ACL at September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | 1,317 | ​ | $ | 5,476 | ​ | $ | 6,793
Leases | ​ | ​ | — | ​ | ​ | 418 | ​ | ​ | 418
Construction and Land Development | ​ |  | — | ​ |  | 1,280 | ​ |  | 1,280
1-4 Family Construction | ​ | ​ | — | ​ | ​ | 294 | ​ | ​ | 294
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​ | ​ |  | ​
1-4 Family Mortgage | ​ |  | — | ​ |  | 2,432 | ​ |  | 2,432
Multifamily | ​ |  | 226 | ​ |  | 23,004 | ​ |  | 23,230
CRE Owner Occupied | ​ | ​ | — | ​ | ​ | 1,112 | ​ | ​ | 1,112
CRE Nonowner Occupied | ​ | ​ | 2,889 | ​ | ​ | 17,761 | ​ | ​ | 20,650
Total Real Estate Mortgage Loans | ​ | ​ | 3,115 | ​ | ​ | 44,309 | ​ | ​ | 47,424
Consumer and Other | ​ | ​ | — | ​ | ​ | 181 | ​ | ​ | 181
Total | ​ | $ | 4,432 | ​ | $ | 51,958 | ​ | $ | 56,390

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Individually | ​ | Collectively | ​ | ​ | ​
​ | ​ | Evaluated for | ​ | Evaluated for | ​ | ​ | ​
(dollars in thousands) |  | Credit Loss | ​ | Credit Loss | ​ | Total
ACL at December 31, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | 133 | ​ | $ | 5,497 | ​ | $ | 5,630
Leases | ​ | ​ | 6 | ​ | ​ | 362 | ​ | ​ | 368
Construction and Land Development | ​ |  | — | ​ |  | 866 | ​ |  | 866
1-4 Family Construction | ​ | ​ | — | ​ | ​ | 331 | ​ | ​ | 331
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​ | ​ |  | ​
1-4 Family Mortgage | ​ |  | — | ​ |  | 2,795 | ​ |  | 2,795
Multifamily | ​ |  | — | ​ |  | 23,120 | ​ |  | 23,120
CRE Owner Occupied | ​ | ​ | — | ​ | ​ | 1,290 | ​ | ​ | 1,290
CRE Nonowner Occupied | ​ | ​ | — | ​ | ​ | 17,735 | ​ | ​ | 17,735
Total Real Estate Mortgage Loans | ​ | ​ | — | ​ | ​ | 44,940 | ​ | ​ | 44,940
Consumer and Other | ​ | ​ | 5 | ​ | ​ | 137 | ​ | ​ | 142
Total | ​ | $ | 144 | ​ | $ | 52,133 | ​ | $ | 52,277

​

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Table of Contents

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Individually | ​ | Collectively | ​ | ​ | ​
​ | ​ | Evaluated for | ​ | Evaluated for | ​ | ​ | ​
(dollars in thousands) |  | Credit Loss | ​ | Credit Loss | ​ | Total
Loans at September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | 14,205 | ​ | $ | 519,271 | ​ | $ | 533,476
Leases | ​ | ​ | 19 | ​ | ​ | 43,167 | ​ | ​ | 43,186
Construction and Land Development | ​ |  | 40 | ​ |  | 159,951 | ​ |  | 159,991
1-4 Family Construction | ​ | ​ | — | ​ | ​ | 41,739 | ​ | ​ | 41,739
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​ | ​ |  | ​
1-4 Family Mortgage | ​ |  | 1,143 | ​ |  | 486,154 | ​ |  | 487,297
Multifamily | ​ |  | 23,857 | ​ |  | 1,554,366 | ​ |  | 1,578,223
CRE Owner Occupied | ​ | ​ | 4,525 | ​ | ​ | 188,441 | ​ | ​ | 192,966
CRE Nonowner Occupied | ​ | ​ | 16,187 | ​ | ​ | 1,142,435 | ​ | ​ | 1,158,622
Total Real Estate Mortgage Loans | ​ | ​ | 45,712 | ​ | ​ | 3,371,396 | ​ | ​ | 3,417,108
Consumer and Other | ​ | ​ | — | ​ | ​ | 19,054 | ​ | ​ | 19,054
Total | ​ | $ | 59,976 | ​ | $ | 4,154,578 | ​ | $ | 4,214,554

​

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Individually | ​ | Collectively | ​ | ​ | ​
​ | ​ | Evaluated for | ​ | Evaluated for | ​ | ​ | ​
(dollars in thousands) |  | Credit Loss | ​ | Credit Loss | ​ | Total
Loans at December 31, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | 14,045 | ​ | $ | 483,617 | ​ | $ | 497,662
Leases | ​ | ​ | 34 | ​ | ​ | 44,257 | ​ | ​ | 44,291
Construction and Land Development | ​ |  | 58 | ​ |  | 97,197 | ​ |  | 97,255
1-4 Family Construction | ​ | ​ | — | ​ | ​ | 41,961 | ​ | ​ | 41,961
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​ | ​ |  | ​
1-4 Family Mortgage | ​ |  | 708 | ​ |  | 473,675 | ​ |  | 474,383
Multifamily | ​ |  | — | ​ |  | 1,425,610 | ​ |  | 1,425,610
CRE Owner Occupied | ​ | ​ | 1,558 | ​ | ​ | 189,690 | ​ | ​ | 191,248
CRE Nonowner Occupied | ​ | ​ | 8,278 | ​ | ​ | 1,074,830 | ​ | ​ | 1,083,108
Total Real Estate Mortgage Loans | ​ | ​ | 10,544 | ​ | ​ | 3,163,805 | ​ | ​ | 3,174,349
Consumer and Other | ​ | ​ | 18 | ​ | ​ | 12,978 | ​ | ​ | 12,996
Total | ​ | $ | 24,699 | ​ | $ | 3,843,815 | ​ | $ | 3,868,514

​

The following tables present the amortized cost basis of collateral dependent loans by the primary collateral type, which are individually evaluated to determine expected credit losses, and the related ACL allocated to these loans, as of September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Primary Type of Collateral | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | Business | ​ | ​ | ​ | ​ | ​ | ​ | ACL
(dollars in thousands) |  | Real Estate |  | Assets |  | Other |  | Total |  | Allocation
September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | — | ​ | $ | 2,525 | ​ | $ | 11,680 | ​ | $ | 14,205 | ​ | $ | 1,317
Leases | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 19 | ​ | ​ | 19 | ​ | ​ | —
Construction and Land Development | ​ |  | 40 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 40 | ​ | ​ | —
Real Estate Mortgage: | ​ |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
1-4 Family Mortgage | ​ |  | 1,143 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 1,143 | ​ | ​ | —
Multifamily | ​ |  | 23,857 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 23,857 | ​ | ​ | 226
CRE Owner Occupied | ​ |  | 4,525 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 4,525 | ​ | ​ | —
CRE Nonowner Occupied | ​ |  | 16,187 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 16,187 | ​ | ​ | 2,889
Totals | ​ | $ | 45,752 | ​ | $ | 2,525 | ​ | $ | 11,699 | ​ | $ | 59,976 | ​ | $ | 4,432

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​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Primary Type of Collateral | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | Business | ​ | ​ | ​ | ​ | ​ | ​ | ACL
(dollars in thousands) |  | Real Estate |  | Assets |  | Other |  | Total |  | Allocation
December 31, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | — | ​ | $ | 3,688 | ​ | $ | 10,357 | ​ | $ | 14,045 | ​ | $ | 133
Leases | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 34 | ​ | ​ | 34 | ​ | ​ | 6
Construction and Land Development | ​ |  | 58 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 58 | ​ | ​ | —
Real Estate Mortgage: | ​ |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
1-4 Family Mortgage | ​ |  | 708 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 708 | ​ | ​ | —
CRE Owner Occupied | ​ |  | 1,558 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 1,558 | ​ | ​ | —
CRE Nonowner Occupied | ​ |  | 8,278 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 8,278 | ​ | ​ | —
Consumer and Other | ​ |  | — | ​ | ​ | — | ​ | ​ | 18 | ​ | ​ | 18 | ​ | ​ | 5
Totals | ​ | $ | 10,602 | ​ | $ | 3,688 | ​ | $ | 10,409 | ​ | $ | 24,699 | ​ | $ | 144

​

Accrued interest receivable on loans, which is recorded within accrued interest on the balance sheet, totaled $12.1 million and $11.4 million at September 30, 2025 and December 31, 2024, respectively, and was excluded from the estimate of credit losses.

​

For both the three months ended September 30, 2025 and September 30, 2024, there were no modified loans to borrowers experiencing financial difficulty. For the nine months ended September 30, 2025, the Company modified one commercial real estate (“CRE”), nonowner occupied loan, with an outstanding balance of $8.6 million, for a borrower experiencing financial difficulty by granting a 3-year extension of the loan at a below market rate. For the nine months ended September 30, 2024, there were no modified loans to borrowers experiencing financial difficulty.

​

Note 5: Goodwill and Other Intangible Assets

Goodwill was $12.0 million at September 30, 2025 and December 31, 2024. Goodwill is not amortized but is subject to, at a minimum, an annual test for impairment. Other intangible assets consist of core deposit relationships and favorable lease terms.

​

The following table presents a summary of other intangible assets at September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, | ​ | December 31,
(dollars in thousands) |  | 2025 |  | 2024
Core Deposit Intangible | ​ | $ | 8,833 | ​ | $ | 8,833
Favorable Lease | ​ |  | 445 | ​ |  | 445
Subtotal | ​ |  | 9,278 | ​ |  | 9,278
Accumulated Amortization | ​ |  | (2,118) | ​ |  | (1,428)
Totals | ​ | $ | 7,160 | ​ | $ | 7,850

​

Amortization expense of other intangible assets was $230,000 for the three months ended September 30, 2025 and $9,000 for the three months ended September 30, 2024. Amortization expense of other intangible assets was $690,000 for the nine months ended September 30, 2025 and $26,000 for the nine months ended September 30, 2024. The core deposit intangible asset is amortized over its estimated useful life of ten years.

​

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The following table presents the estimated future amortization of the core deposit intangible and favorable lease assets for the next five years and thereafter. The projections of amortization expense are based on existing asset balances as of September 30, 2025.

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Core Deposit | ​ | Favorable
(dollars in thousands) | ​ | Intangible |  | Lease
2025 | ​ | $ | 221 | ​ | $ | 9
2026 | ​ |  | 871 | ​ |  | 34
2027 | ​ |  | 852 | ​ |  | 34
2028 | ​ |  | 830 | ​ |  | 34
2029 | ​ |  | 803 | ​ |  | 18
2030 | ​ | ​ | 773 | ​ | ​ | —
Thereafter | ​ |  | 2,681 | ​ |  | —
Totals | ​ | $ | 7,031 | ​ | $ | 129

​

​

Note 6: Deposits

The following table presents the composition of deposits at September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, | ​ | December 31,
(dollars in thousands) |  | 2025 |  | 2024
Transaction Deposits | ​ | $ | 1,683,406 | ​ | $ | 1,663,005
Savings and Money Market Deposits | ​ |  | 1,428,726 | ​ |  | 1,259,503
Time Deposits | ​ |  | 346,214 | ​ |  | 338,506
Brokered Deposits | ​ |  | 834,418 | ​ |  | 825,753
Totals | ​ | $ | 4,292,764 | ​ | $ | 4,086,767

​
​
​
​​

Brokered deposits included brokered transaction and money market accounts of $149.4 million and $127.4 million as of September 30, 2025 and December 31, 2024, respectively.

​

The following table presents the scheduled maturities of brokered and time deposits at September 30, 2025:

​

​ | ​ | ​ | ​
​ | ​ | September 30,
(dollars in thousands) |  | 2025
Less than 1 Year | ​ | $ | 663,327
1 to 2 Years | ​ | ​ | 118,836
2 to 3 Years | ​ | ​ | 79,134
3 to 4 Years | ​ | ​ | 72,237
4 to 5 Years | ​ | ​ | 97,733
Totals | ​ | $ | 1,031,267

​

The aggregate amount of time deposits greater than $250,000 was approximately $179.8 million and $155.0 million at September 30, 2025 and December 31, 2024, respectively.

​

​

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Note 7: Derivative Instruments and Hedging Activities

The Company uses derivative financial instruments, which consist of interest rate swaps, interest rate caps, and fair value swaps to assist in its interest rate risk management. The notional amount does not represent amounts exchanged by the parties. The amount exchanged is determined by reference to the notional amount and the other terms of the individual agreements. Derivative financial instruments are reported at fair value in other assets or other liabilities. The accounting for changes in the fair value of a derivative depends on whether it has been designated and qualifies as part of a hedging relationship and classification as either a cash flow hedge or fair value hedge for those derivatives which are designated as part of a hedging relationship. For derivatives not designated as hedges, the gain or loss is recognized in current earnings.

​

Non-hedge Derivatives

​

The Company enters into interest rate swaps to facilitate client transactions and meet their financing needs. Upon entering into these instruments to meet client needs, the Company enters into offsetting positions with large U.S. financial institutions in order to minimize the risk to the Company. These swaps are derivatives, but are not designated as hedging instruments.

Interest rate swap contracts involve the risk of dealing with counterparties and their ability to meet contractual terms. When the fair value of a derivative instrument contract is positive, this generally indicates that the counterparty or client owes the Company, and results in credit risk to the Company. When the fair value of a derivative instrument contract is negative, the Company owes the client or counterparty and therefore, the Company has no credit risk.

The following table presents a summary of the Company’s interest rate swaps to facilitate customer transactions as of September 30, 2025 and December 31, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025 | ​ | December 31, 2024
​ | ​ | Notional | ​ | Estimated | ​ | Notional | ​ | Estimated
(dollars in thousands) | ​ | Amount | ​ | Fair Value | ​ | Amount | ​ | Fair Value
Interest rate swap agreements: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Assets | ​ | $ | 170,837 | ​ | $ | 8,549 | ​ | $ | 115,577 | ​ | $ | 8,210
Liabilities | ​ |  | 170,837 | ​ |  | (8,549) | ​ |  | 115,577 | ​ |  | (8,210)
Total | ​ | $ | 341,674 | ​ | $ | — | ​ | $ | 231,154 | ​ | $ | —

​

The Company has entered into a risk participation agreement (“RPA”) to share credit exposure with a counterparty related to an interest rate swap agreement associated with a loan participation. Under the RPA, the Company sold a portion of its credit exposure, receiving an up-front fee, and will be required to make a payment if the loan client defaults on its obligations. The notional amount of the RPA reflects the Company’s pro-rata share of the derivative instrument consistent with its share of the related participated loan.

​

The following table presents a summary of the Company’s RPA as of September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | September 30, 2025 | ​ | December 31, 2024
​ | ​ | Location of | ​ | Notional | ​ | Fair Value | ​ | Notional | ​ | Fair Value
(dollars in thousands) | ​ | Gain (Loss) | ​ | Amount | ​ | Assets | ​ | Liabilities | ​ | Amount | ​ | Assets | ​ | Liabilities
Risk Participation Agreement | ​ | Other Income | ​ | $ | 9,944 | ​ | $ | — | ​ | $ | 17 | ​ | $ | — | ​ | $ | — | ​ | $ | —

​

​

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Any gain or loss related to changes in the fair value of the RPA is recorded to earnings. For the three months ended September 30, 2025, the total net gain recorded to earnings was $2,000. For the nine months ended September, 30, 2025, the total net loss recorded to earnings was $17,000. There was no gain or loss recorded to earnings for the three and nine months ended September 30, 2024

​

Cash Flow Hedging Derivatives

​

For derivative instruments that are designated and qualify as a cash flow hedge, the aggregate fair value of the derivative instrument is recorded in other assets or other liabilities with any gain or loss related to changes in fair value recorded in accumulated other comprehensive income, net of tax. The gain or loss is reclassified into earnings in the same period during which the hedged asset or liability affects earnings and is presented in the same income statement line item as the earnings effect of the hedged asset or liability. The Company utilizes cash flow hedges to manage interest rate exposure for the brokered deposit and wholesale borrowing portfolios. During the next 12 months, the Company estimates that $3.7 million will be reclassified to interest expense, as a reduction of the expense.

​

The following table presents a summary of the Company’s interest rate swaps designated as cash flow hedges as of September 30, 2025 and December 31, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(dollars in thousands) |  | September 30, 2025 |  | December 31, 2024 | ​
Notional Amount | ​ | $ | 183,000 | ​ | $ | 178,000 | ​
Weighted Average Pay Rate | ​ | ​ | 2.87 | % | ​ | 2.20 | %
Weighted Average Receive Rate | ​ | ​ | 4.30 | % | ​ | 4.80 | %
Weighted Average Maturity (Years) | ​ | ​ | 4.42 | ​ | ​ | 4.02 | ​
Net Unrealized Gain | ​ | $ | 636 | ​ | $ | 5,139 | ​

​

The Company purchases interest rate caps, designated as cash flow hedges, of certain liabilities. The interest rate caps require receipt of variable amounts from the counterparties when interest rates rise above the strike price in the contracts. For the three and nine months ended September 30, 2025, the Company recognized amortization expense on the interest rate caps of $200,000 and $593,000, respectively, which was recorded as a component of interest expense on FHLB advances. For the three and nine months ended September 30, 2024, the Company recognized amortization expense on the interest rate caps of $204,000 and $600,000, respectively, which was recorded as a component of interest expense on brokered deposits and FHLB advances.

​

The following table presents a summary of the Company’s interest rate caps designated as cash flow hedges as of September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(dollars in thousands) |  | September 30, 2025 |  | December 31, 2024 | ​
Notional Amount | ​ | $ | 125,000 | ​ | $ | 125,000 | ​
Unamortized Premium Paid | ​ | ​ | 3,688 | ​ | ​ | 4,281 | ​
Weighted Average Strike Rate | ​ | ​ | 0.96 | % | ​ | 0.96 | %
Weighted Average Maturity (Years) | ​ | ​ | 4.59 | ​ | ​ | 5.34 | ​

​

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The following table presents the effect of derivative instruments in cash flow hedging relationships on the consolidated statements of income for the three and nine months ended September 30, 2025 and 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Three Months Ended September 30, | ​ | Nine Months Ended September 30,
(dollars in thousands) | ​ | 2025 | ​ | 2024 | ​ | 2025 | ​ | 2024
Derivatives in | ​ | Location of Gain | ​ | Gain | ​ | Gain
Cash Flow Hedging | ​ | Reclassified | ​ | Reclassified from | ​ | Reclassified from
Relationships | ​ | from AOCI into Income | ​ | AOCI into Earnings | ​ | AOCI into Earnings
Interest rate swaps | ​ | Interest expense | ​ | $ | 683 | ​ | $ | 1,478 | ​ | $ | 2,318 | ​ | $ | 4,549
Interest rate caps | ​ | Interest expense | ​ | ​ | 917 | ​ | ​ | 1,048 | ​ | ​ | 2,731 | ​ | ​ | 2,609

​

No amounts were reclassified from accumulated other comprehensive income into net income related to hedge ineffectiveness for these derivatives during the three and nine months ended September 30, 2025 and 2024, and no amounts are expected to be reclassified from accumulated other comprehensive income into net income related to hedge ineffectiveness over the next twelve months.

Fair Value Hedging Derivatives

​

For derivative instruments that are designated and qualify as a fair value hedge, the gain or loss on the derivative instrument as well as the offsetting gain or loss on the hedged asset or liability attributable to the hedged risk are recognized in current earnings. The gain or loss on the derivative instrument is presented on the same income statement line item as the earnings effect of the hedged item. The Company utilizes fair value hedges to mitigate the effect of changing interest rates on the fair values of fixed rate available for sale securities. The hedging strategy converts the fixed interest rates to variable interest rates based on Secured Overnight Financing Rate (“SOFR”).

​

The following table presents a summary of the Company’s interest rate swaps designated as fair value hedges as of September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(dollars in thousands) | ​ | September 30, 2025 | ​ | December 31, 2024 | ​
Notional Amount | ​ | $ | 243,569 | ​ | $ | 145,850 | ​
Weighted Average Pay Rate | ​ | ​ | 3.56 | % | ​ | 3.52 | %
Weighted Average Receive Rate | ​ | ​ | 4.32 | ​ | ​ | 4.82 | ​
Weighted Average Maturity (Years) | ​ | ​ | 14.79 | ​ | ​ | 19.47 | ​

​

The effects of the Company’s fair value hedge relationships on the income statement during the three and nine months ended September 30, 2025 and 2024 were as follows:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Amount of Gain (Loss) Recognized in Income
(dollars in thousands) | ​ | Three Months Ended September 30, | ​ | Nine Months Ended September 30,
Securities | ​ | Location of Gain (Loss) | ​ | 2025 | ​ | 2024 | ​ | 2025 | ​ | 2024
Interest Rate Swaps | ​ | Interest Income | ​ | $ | (202) | ​ | ​ | (893) | ​ | $ | (3,734) | ​ | ​ | (893)
Securities Available for Sale | ​ | Interest Income | ​ | ​ | 202 | ​ | ​ | 893 | ​ | ​ | 3,734 | ​ | ​ | 893

​

The following table presents amounts that were recorded on the balance sheet related to cumulative basis adjustments for fair value hedges at September 30, 2025 and December 31, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Cumulative Amount of Fair Value Hedging Adjustment
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Included in the Carrying Amount of the Hedged
(dollars in thousands) | ​ | Carrying Amount of The Hedged Assets/Liabilities | ​ | ​ | Assets/Liabilities
Line Item on the Balance Sheet | ​ | September 30, 2025 | ​ | December 31, 2024 | ​ | September 30, 2025 | ​ | December 31, 2024
Securities Available for Sale | ​ | $ | 250,347 | ​ | ​ | 156,337 | ​ | $ | 6,778 | ​ | ​ | 10,487

​

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The following table presents a summary of the Company’s interest rate contracts as of September 30, 2025 and December 31, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025 | ​ | December 31, 2024
​ | ​ | Notional | ​ | Estimated | ​ | Notional | ​ | Estimated
(dollars in thousands) | ​ | Amount | ​ | Fair Value | ​ | Amount | ​ | Fair Value
Interest Rate Swap Agreements - Borrowings: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Assets | ​ | $ | 45,000 | ​ | $ | 1,914 | ​ | $ | 178,000 | ​ | $ | 5,139
Liabilities | ​ | ​ | 138,000 | ​ | ​ | (1,278) | ​ | ​ | — | ​ | ​ | —
Interest Rate Swap Agreements - Securities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Assets | ​ | ​ | 145,850 | ​ | ​ | 7,546 | ​ | ​ | 145,850 | ​ | ​ | 10,487
Liabilities | ​ | ​ | 97,719 | ​ | ​ | (768) | ​ | ​ | — | ​ | ​ | —
Interest Rate Cap Agreements: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Assets | ​ | ​ | 125,000 | ​ | ​ | 13,643 | ​ | ​ | 125,000 | ​ | ​ | 19,319

​

The Company is party to collateral support agreements with certain derivative counterparties. These agreements require that the Company maintain collateral based on the fair values of derivative transactions. In the event of default by the Company, the counterparty would be entitled to the collateral. As of September 30, 2025 and December 31, 2024, the Company had pledged no cash collateral for the Company’s derivative contracts. As of September 30, 2025 and December 31, 2024, the Company’s counterparties had pledged cash collateral to the Company of $25.2 million and $44.2 million, respectively.

​

The following table summarizes gross and net information about derivative instruments that are eligible for offset in the balance sheet at September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Gross Amounts Not Offset in the Balance Sheet | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Net Amounts of | ​ | ​ | ​ | ​ | ​
​ | ​ | Gross Amounts | ​ | Gross Amounts | ​ | Assets (Liabilities) | ​ | ​ | ​ | ​ | ​
​ | ​ | of Recognized | ​ | Offset in the | ​ | Presented in the | ​ | Financial | ​ | Cash Collateral | ​ | Net Assets
(dollars in thousands) | ​ | Assets (Liabilities) | ​ | Balance Sheet | ​ | Balance Sheet | ​ | Instruments | ​ | Received | ​ | (Liabilities)
September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Assets | ​ | $ | 31,652 | ​ | $ | — | ​ | $ | 31,652 | ​ | $ | — | ​ | $ | 25,243 | ​ | $ | 6,409
Liabilities | ​ |  | (10,595) | ​ |  | — | ​ |  | (10,595) | ​ |  | — | ​ |  | — | ​ |  | (10,595)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
December 31, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Assets | ​ | $ | 43,155 | ​ | $ | — | ​ | $ | 43,155 | ​ | $ | — | ​ | $ | 44,233 | ​ | $ | (1,078)
Liabilities | ​ | ​ | (8,210) | ​ | ​ | — | ​ | ​ | (8,210) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (8,210)

​

​

​

​

Note 8: Federal Home Loan Bank Advances and Other Borrowings

Federal Home Loan Bank Advances. The Company has entered into an Advances, Pledge, and Security Agreement with the FHLB whereby specific mortgage loans of the Bank with aggregate principal balances of $1.64 billion and $1.54 billion at September 30, 2025 and December 31, 2024, respectively, were pledged to the FHLB as collateral. FHLB advances are also secured with FHLB stock owned by the Company. Total remaining available capacity under the agreement was $493.6 million and $483.2 million at September 30, 2025 and December 31, 2024, respectively.

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The following table presents information regarding FHLB advances, by maturity, at September 30, 2025 and December 31, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025 | ​ | December 31, 2024
​ |  | Weighted |  | ​ |  | Weighted |  | ​
​ | ​ | Average | ​ | Total | ​ | Average | ​ | Total
(dollars in thousands) | ​ | Rate | ​ | Outstanding | ​ | Rate | ​ | Outstanding
Less than 1 Year | ​ | 4.36 | % | $ | 320,500 | ​ | 4.62 | % | $ | 288,000
1 to 2 Years | ​ | 3.71 | ​ | ​ | 31,500 | ​ | 3.45 | ​ | ​ | 21,500
2 to 3 Years | ​ | 4.02 | ​ | ​ | 30,000 | ​ | 4.13 | ​ | ​ | 27,500
3 to 4 Years | ​ | 4.10 | ​ | ​ | 15,000 | ​ | 4.01 | ​ | ​ | 22,500
4 to 5 Years | ​ | 4.09 | ​ | ​ | 7,500 | ​ | — | ​ | ​ | —
Totals | ​ | ​ | ​ | $ | 404,500 | ​ | ​ | ​ | $ | 359,500

​

Line of Credit. The Company has a Loan and Security Agreement and related revolving note with an unaffiliated financial institution that is secured by 100% of the issued and outstanding stock of the Bank. The note contains customary representations, warranties, and covenants, including certain financial covenants and capital ratio requirements. The Company believes it was in compliance with all covenants as of September 30, 2025 and December 31, 2024.

The following table presents information regarding the revolving line of credit at September 30, 2025 and December 31, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | Total Debt | ​ | ​ | Total Debt | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | Outstanding | ​ | ​ | Outstanding | ​ | Interest | ​ | ​ | ​
Name | ​ | Maturity Date | ​ | ​ | September 30, 2025 | ​ | ​ | December 31, 2024 | ​ | Rate | ​ | ​ | Coupon Structure
(dollars in thousands) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Revolving Credit Facility | ​ | September 1, 2026 | ​ | $ | — | ​ | $ | 13,750 | ​ | 7.50 | % | ​ | Variable with Floor (1)

(1) | The variable interest rate is equal to the greater of Wall Street Journal Prime Rate in effect or a floor of 4.50%.

​

​

Note 9: Subordinated Debentures

On June 24, 2025, the Company issued $80.0 million of Fixed-to-Floating Rate Subordinated Notes due June 30, 2035. The Notes bear a fixed interest rate of 7.625% from June 24, 2025 to but excluding June 30, 2030, with interest during this period payable semi-annually in arrears. From June 30, 2030 to the stated maturity date or earlier redemption date, the interest rate converts to a variable rate equal to the then current three-month term SOFR, plus 388 basis points, which is payable quarterly. The Company used the net proceeds it received from the sale of the Notes to redeem $50 million of outstanding 5.25% Fixed-to-Floating Rate Subordinated Notes due 2030 and for general corporate purposes. The transaction resulted in debt issuance costs of approximately $1.3 million that is being amortized over 10 years.

​

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The following table presents a summary of the Company’s subordinated debentures as of September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Total Debt | ​ | ​ | Total Debt | ​ | ​ | ​ | ​ | ​
​ | ​ | Date | ​ | ​ | First | ​ | ​ | Maturity | ​ | Outstanding | ​ | ​ | Outstanding | ​ | Interest | ​ | ​ | ​
Name | ​ | Established | ​ | ​ | Redemption Date | ​ | ​ | Date | ​ | September 30, 2025 | ​ | ​ | December 31, 2024 | ​ | Rate | ​ | ​ | Coupon Structure
(dollars in thousands) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
2030 Notes | ​ | June 19, 2020 | ​ | ​ | July 1, 2025 | ​ | ​ | July 1, 2030 | $ | — | ​ | $ | 50,000 | ​ | 5.25 | % | ​ | Fixed-to-Floating (1)
2031 Notes | ​ | July 8, 2021 | ​ | ​ | July 15, 2026 | ​ | ​ | July 15, 2031 | ​ | 30,000 | ​ | ​ | 30,000 | ​ | 3.25 | % | ​ | Fixed-to-Floating (2)
2035 Notes | ​ | June 24, 2025 | ​ | ​ | June 30, 2030 | ​ | ​ | June 30, 2035 | ​ | 80,000 | ​ | ​ | — | ​ | 7.625 | % | ​ | Fixed-to-Floating (3)
Subordinated Debentures | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 110,000 | ​ | ​ | 80,000 | ​ | ​ | ​ | ​ | ​
Debt Issuance Costs | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | (1,412) | ​ | ​ | (330) | ​ | ​ | ​ | ​ | ​
Subordinated Debentures, Net of Issuance Costs | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | $ | 108,588 | ​ | $ | 79,670 | ​ | ​ | ​ | ​ | ​

(1) | Notes fully redeemed as of June 30, 2025.

(2) | Migrates to three month term SOFR + 2.52% beginning July 15, 2026 until either the maturity date or earlier redemption date.

(3) | Migrates to three month term SOFR + 3.88% beginning June 30, 2030 until either the maturity date or earlier redemption date.

​

Note 10: Commitments, Contingencies and Credit Risk

Financial Instruments with Off-Balance Sheet Credit Risk

The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated balance sheets.

The Company’s exposure to credit loss is represented by the contractual, or notional, amount of these commitments. The Company follows the same credit policies in making commitments as it does for on-balance sheet instruments. Since some of the commitments are expected to expire without being drawn upon and some of the commitments may not be drawn upon to the total extent of the commitment, the notional amount of these commitments does not necessarily represent future cash requirements.

The following table presents information regarding commitments outstanding at September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, | ​ | December 31,
(dollars in thousands) |  | 2025 |  | 2024
Unfunded Commitments Under Lines of Credit | ​ | $ | 794,788 | ​ | $ | 679,064
Letters of Credit | ​ |  | 133,538 | ​ |  | 124,397
Totals | ​ | $ | 928,326 | ​ | $ | 803,461

​

The Company had outstanding letters of credit with the FHLB of $135.4 million and $103.2 million at September 30, 2025 and December 31, 2024, respectively, on behalf of customers and to secure public deposits.

The ACL for off-balance sheet credit exposures was $3.8 million and $3.6 million at September 30, 2025 and December 31, 2024, respectively, and is separately classified on the balance sheet within other liabilities.

​

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The following table presents the balance and activity in the ACL for off-balance sheet credit exposures for the three and nine months ended September 30, 2025 and 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | Three Months Ended | ​ | ​ | Nine Months Ended
​ | ​ | ​ | September 30, | ​ | ​ | September 30,
(dollars in thousands) | ​ | ​ | 2025 | ​ | ​ | 2024 | ​ | ​ | 2025 | ​ | ​ | 2024
Allowance for Credit Losses: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Beginning Balance | ​ | $ | 3,610 | ​ | $ | 2,885 | ​ | $ | 3,610 | ​ | $ | 2,985
Provision for (Recovery of) Off-Balance Sheet Credit Exposures | ​ | ​ | 200 | ​ | ​ | — | ​ | ​ | 200 | ​ | ​ | (100)
Total Ending Balance | ​ | $ | 3,810 | ​ | $ | 2,885 | ​ | $ | 3,810 | ​ | $ | 2,885

​

Legal Contingencies

Neither the Company nor any of its subsidiaries is a party, and no property of these entities is subject, to any material pending legal proceedings, other than ordinary routine litigation incidental to the Bank’s business. The Company does not know of any material proceeding contemplated by a governmental authority against the Company or any of its subsidiaries.

​

Note 11: Stock Options and Restricted Stock

In 2012, the Company adopted the Bridgewater Bancshares, Inc. 2012 Combined Incentive and Non-Statutory Stock Option Plan (the “2012 Plan”) under which the Company was able to grant options to its directors, officers, and employees for up to 750,000 shares of common stock. Both incentive stock options and nonqualified stock options were granted under the 2012 Plan. The exercise price of each option equals the fair market value of the Company’s stock on the date of grant, and the maximum term of each outstanding option is ten years. All outstanding options have been granted with vesting periods of four or five years. The 2012 Plan expired in March 2022, and awards are no longer able to be granted under the 2012 Plan.

In 2017, the Company adopted the Bridgewater Bancshares, Inc. 2017 Combined Incentive and Non-Statutory Stock Option Plan (the “2017 Plan”). Under the 2017 Plan, the Company may grant options to its directors, officers, employees and consultants for up to 1,500,000 shares of common stock. Both incentive stock options and nonqualified stock options may be granted under the 2017 Plan. The exercise price of each option equals the fair market value of the Company’s stock on the date of grant and the maximum term of each outstanding option is ten years. All outstanding options have been granted with vesting periods of four or five years. As of September 30, 2025 and December 31, 2024, there were 10,000 and 30,000 shares, respectively, of the Company’s common stock reserved for future option grants under the 2017 Plan.

In 2019, the Company adopted the Bridgewater Bancshares, Inc. 2019 Equity Incentive Plan (the “2019 EIP”). The types of awards which may be granted under the 2019 EIP include incentive and nonqualified stock options, stock appreciation rights, stock awards, restricted stock units, restricted stock and cash incentive awards. The Company may grant these awards to its directors, officers, employees and certain other service providers for up to 1,000,000 shares of common stock. The exercise price of each option equals the fair market value of the Company’s stock on the date of grant and the maximum term of each award is ten years. All outstanding awards have been granted with a vesting period of four years. As of September 30, 2025 and December 31, 2024, there were 2,192 and 87 shares, respectively, of the Company’s common stock reserved for future grants under the 2019 EIP.

In 2023, the Company adopted the Bridgewater Bancshares, Inc. 2023 Equity Incentive Plan (the “2023 EIP”). Under the 2023 EIP, the Company may grant incentive and nonqualified stock options, stock appreciation rights, stock awards, restricted stock units, restricted stock and cash incentive awards. The Company may grant these awards to its directors, officers, employees and certain other service providers for up to 1,500,000 shares of common stock. The

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exercise price of each option equals the fair market value of the Company’s stock on the date of grant and the maximum term of each award is ten years. All outstanding awards have been granted with a vesting period of four years. As of September 30, 2025 and December 31, 2024, there were 661,403 and 972,460 shares, respectively, of the Company’s common stock reserved for future grants under the 2023 EIP.

Stock Options

The fair value of each option award is estimated on the date of grant using a closed form option valuation (Black-Scholes) model that uses the assumptions noted in the table below. Expected volatilities are based on an industry index as described below. The expected term of options granted is based on historical data and represents the period of time that options granted are expected to be outstanding, which takes into account the fact that the options are not transferable. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant. Historically, the Company has not paid a dividend on its common stock and does not expect to do so in the near future.

The Company used the S&P 600 CM Bank Index as its historical volatility index. The S&P 600 CM Bank Index is an index of publicly traded small capitalization, regional, commercial banks located throughout the United States. There were 59 banks in the index ranging in market capitalization from $600 million up to $5.0 billion.

The weighted average assumptions used in the model for valuing stock options grants for the nine months ended September 30, 2025 are as follows:

​

​ | ​ | ​ | ​
​ | ​ | September 30, | ​
​ |  | 2025 |
Dividend Yield |  | — | %
Expected Life |  | 7 | Years
Expected Volatility |  | 30.83 | %
Risk-Free Interest Rate |  | 4.42 | %

​

​

The following table presents a summary of the status of the Company’s outstanding stock options for the nine months ended September 30, 2025:

​

​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025
​ |  |  |  | Weighted
​ | ​ | ​ | ​ | Average
​ | ​ | Shares | ​ | Exercise Price
Outstanding at Beginning of Year |  | 1,860,609 | ​ | $ | 10.69
Granted |  | 275,000 | ​ |  | 13.77
Exercised |  | (148,738) | ​ |  | 8.39
Forfeitures |  | (16,500) | ​ |  | 12.94
Outstanding at Period End |  | 1,970,371 | ​ | $ | 11.28
​ | ​ | ​ | ​ | ​ | ​
Options Exercisable at Period End |  | 1,396,745 | ​ | $ | 10.52

​

For the three months ended September 30, 2025 and 2024, the Company recognized compensation expense for stock options of $315,000 and $227,000, respectively. For the nine months ended September 30, 2025 and 2024, the Company recognized compensation expense for stock options of $893,000 and $712,000, respectively.

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The following table presents information pertaining to options outstanding at September 30, 2025:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | Options Outstanding | ​ | Options Exercisable
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Weighted Average | ​ | ​ | ​ | ​
​ | ​ | ​ | Number of | ​ | Weighted Average | ​ | Remaining Contractual | ​ | Number of | ​ | Weighted Average
Range of Exercise Prices |  | Options |  | Exercise Price | ​ | Life in Years | ​ | Options |  | Exercise Price
$ | 7.00 - 7.99 |  | 714,438 |  | $ | 7.47 |  | 2.0 |  | 714,438 |  | $ | 7.47
​ | 8.00 - 8.99 |  | 2,961 |  | ​ | 8.76 |  | 4.5 |  | 2,961 |  | ​ | 8.76
​ | 10.00 - 10.99 | ​ | 204,250 | ​ | ​ | 10.62 | ​ | 7.7 | ​ | 96,499 | ​ | ​ | 10.59
​ | 11.00 - 11.99 | ​ | 229,125 | ​ | ​ | 11.16 | ​ | 6.5 | ​ | 117,000 | ​ | ​ | 11.22
​ | 12.00 - 12.99 | ​ | 249,097 | ​ | ​ | 12.91 | ​ | 3.8 | ​ | 249,097 | ​ | ​ | 12.91
​ | 13.00 - 13.99 | ​ | 285,000 | ​ | ​ | 13.75 | ​ | 9.3 | ​ | 2,500 | ​ | ​ | 12.91
​ | 17.00 - 17.99 | ​ | 285,500 | ​ | ​ | 17.50 | ​ | 6.3 | ​ | 214,250 | ​ | ​ | 17.50
​ | Totals |  | 1,970,371 | ​ | $ | 11.28 | ​ | 5.0 |  | 1,396,745 | ​ | $ | 10.52

​

As of September 30, 2025, there was $2.4 million of total unrecognized compensation cost related to nonvested stock options that is expected to be recognized over a weighted-average period of 2.3 years.

The following table presents an analysis of nonvested options to purchase shares of the Company’s stock issued and outstanding for the nine months ended September 30, 2025:

​

​ | ​ | ​ | ​ | ​ | ​
​ |  |  |  | Weighted
​ | ​ | Number of | ​ | Average Grant
​ | ​ | Shares | ​ | Date Fair Value
Nonvested Options at December 31, 2024 |  | 437,501 | ​ | $ | 5.18
Granted |  | 275,000 | ​ | ​ | 5.83
Vested |  | (129,000) | ​ | ​ | 5.33
Forfeited | ​ | (9,875) | ​ | ​ | 4.85
Nonvested Options at September 30, 2025 |  | 573,626 | ​ | $ | 5.46

​

Restricted Stock Awards

There was no restricted stock award activity for the nine months ended September 30, 2025. Compensation expense associated with restricted stock awards is recognized on a straight-line basis over the period that the restrictions associated with the awards lapse based on the total cost of the award at the grant date. For the three months ended September 30, 2025 and 2024, the Company recognized compensation expense associated with restricted stock awards of $-0- and $2,000, respectively. For the nine months ended September 30, 2025 and 2024, the Company recognized compensation expense associated with restricted stock awards of $-0- and $12,000, respectively.

​

In addition, during the nine months ended September 30, 2025, the Company issued 23,495 shares of unrestricted common stock to non-employee directors as a part of their compensation for their annual services on the Company’s board of directors. The aggregate value of the shares issued to non-employee directors of $369,000 was included in stock based compensation expense in the accompanying consolidated statements of shareholders’ equity.

Restricted Stock Units

The Company has granted restricted stock units out of the 2019 EIP and 2023 EIP. Restricted stock units represent the right to receive one share of Company stock upon vesting and vest in equal annual installments on the first four anniversaries of the date of the grant. Nonvested restricted stock units have no voting or dividend rights and are not considered outstanding until vesting.

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The following table presents an analysis of nonvested restricted stock units outstanding for the nine months ended September 30, 2025:

​ | ​ | ​ | ​ | ​ | ​
​ |  |  |  | Weighted
​ | ​ | Number of | ​ | Average Grant
​ | ​ | Units | ​ | Date Fair Value
Nonvested at December 31, 2024 |  | 415,758 | ​ | $ | 14.46
Granted |  | 55,355 | ​ | ​ | 13.78
Vested |  | (38,962) | ​ | ​ | 14.12
Forfeited | ​ | (8,398) | ​ | ​ | 14.39
Nonvested at September 30, 2025 |  | 423,753 | ​ | $ | 14.40

​

Compensation expense associated with the restricted stock units is recognized on a straight-line basis over the period that the restrictions associated with the units lapse based on the total cost of the unit at the grant date. For the three months ended September 30, 2025 and 2024, the Company recognized compensation expense associated with restricted stock units of $629,000 and $574,000, respectively. For both the nine months ended September 30, 2025 and 2024, the Company recognized compensation expense associated with restricted stock units of $1.9 million.

​

As of September 30, 2025, there was $4.2 million of total unrecognized compensation cost related to nonvested restricted stock units granted under the 2019 EIP and 2023 EIP that is expected to be recognized over a weighted-average period of 2.3 years.

​

​

Note 12: Regulatory Capital

The Company and the Bank are subject to various regulatory requirements administered by federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The Bank must also meet certain specific capital guidelines under the regulatory framework for prompt corrective action. The capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy require the Company and Bank to maintain minimum amounts and ratios of common equity Tier 1 capital, Tier 1 capital and total capital to risk-weighted assets and of Tier 1 capital to average consolidated assets (referred to as the “leverage ratio”), as defined under the applicable regulatory capital rules.

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The following tables present the capital amounts and ratios for the Company, on a consolidated basis, and the Bank as of September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | Minimum Required | ​ | For Capital Adequacy | ​ | To be Well Capitalized | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | For Capital Adequacy | ​ | Purposes Plus Capital | ​ | Under Prompt Corrective | ​
​ | ​ | Actual | ​ | Purposes | ​ | Conservation Buffer | ​ | Action Regulations | ​
(dollars in thousands) |  | Amount |  | Ratio |  | Amount |  | Ratio |  | Amount |  | Ratio | ​ | Amount |  | Ratio | ​
September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Company (Consolidated): | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Risk-based Capital | ​ | $ | 652,426 | ​ | 14.12 | % | $ | 369,556 | ​ | 8.00 | % | $ | 485,042 | ​ | 10.50 | % | ​ | N/A | ​ | N/A | ​
Tier 1 Risk-based Capital | ​ | ​ | 486,065 | ​ | 10.52 | ​ | ​ | 277,167 | ​ | 6.00 | ​ | ​ | 392,653 | ​ | 8.50 | ​ | ​ | N/A | ​ | N/A | ​
Common Equity Tier 1 Capital | ​ | ​ | 419,551 | ​ | 9.08 | ​ | ​ | 207,875 | ​ | 4.50 | ​ | ​ | 323,361 | ​ | 7.00 | ​ | ​ | N/A | ​ | N/A | ​
Tier 1 Leverage Ratio | ​ | ​ | 486,065 | ​ | 9.02 | ​ | ​ | 215,446 | ​ | 4.00 | ​ | ​ | 215,446 | ​ | 4.00 | ​ | ​ | N/A | ​ | N/A | ​
Bank: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Risk-based Capital | ​ | $ | 619,058 | ​ | 13.43 | % | $ | 368,824 | ​ | 8.00 | % | $ | 484,082 | ​ | 10.50 | % | $ | 461,030 | ​ | 10.00 | %
Tier 1 Risk-based Capital | ​ | ​ | 561,397 | ​ | 12.18 | ​ | ​ | 276,618 | ​ | 6.00 | ​ | ​ | 391,876 | ​ | 8.50 | ​ | ​ | 368,824 | ​ | 8.00 | ​
Common Equity Tier 1 Capital | ​ | ​ | 561,397 | ​ | 12.18 | ​ | ​ | 207,464 | ​ | 4.50 | ​ | ​ | 322,721 | ​ | 7.00 | ​ | ​ | 299,670 | ​ | 6.50 | ​
Tier 1 Leverage Ratio | ​ | ​ | 561,397 | ​ | 10.43 | ​ | ​ | 215,230 | ​ | 4.00 | ​ | ​ | 215,230 | ​ | 4.00 | ​ | ​ | 269,037 | ​ | 5.00 | ​

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | Minimum Required | ​ | For Capital Adequacy | ​ | To be Well Capitalized | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | For Capital Adequacy | ​ | Purposes Plus Capital | ​ | Under Prompt Corrective | ​
​ | ​ | Actual | ​ | Purposes | ​ | Conservation Buffer | ​ | Action Regulations | ​
(dollars in thousands) |  | Amount |  | Ratio |  | Amount |  | Ratio |  | Amount |  | Ratio | ​ | Amount |  | Ratio | ​
December 31, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Company (Consolidated): | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Risk-based Capital | ​ | $ | 585,966 | ​ | 13.76 | % | $ | 340,581 | ​ | 8.00 | % | $ | 447,013 | ​ | 10.50 | % | ​ | N/A | ​ | N/A | ​
Tier 1 Risk-based Capital | ​ | ​ | 453,049 | ​ | 10.64 | ​ | ​ | 255,436 | ​ | 6.00 | ​ | ​ | 361,867 | ​ | 8.50 | ​ | ​ | N/A | ​ | N/A | ​
Common Equity Tier 1 Capital | ​ | ​ | 386,535 | ​ | 9.08 | ​ | ​ | 191,577 | ​ | 4.50 | ​ | ​ | 298,008 | ​ | 7.00 | ​ | ​ | N/A | ​ | N/A | ​
Tier 1 Leverage Ratio | ​ | ​ | 453,049 | ​ | 9.44 | ​ | ​ | 191,878 | ​ | 4.00 | ​ | ​ | 191,878 | ​ | 4.00 | ​ | ​ | N/A | ​ | N/A | ​
Bank: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Risk-based Capital | ​ | $ | 573,158 | ​ | 13.49 | % | $ | 340,003 | ​ | 8.00 | % | $ | 446,254 | ​ | 10.50 | % | $ | 425,004 | ​ | 10.00 | %
Tier 1 Risk-based Capital | ​ | ​ | 520,000 | ​ | 12.24 | ​ | ​ | 255,002 | ​ | 6.00 | ​ | ​ | 361,253 | ​ | 8.50 | ​ | ​ | 340,003 | ​ | 8.00 | ​
Common Equity Tier 1 Capital | ​ | ​ | 520,000 | ​ | 12.24 | ​ | ​ | 191,252 | ​ | 4.50 | ​ | ​ | 297,503 | ​ | 7.00 | ​ | ​ | 276,253 | ​ | 6.50 | ​
Tier 1 Leverage Ratio | ​ | ​ | 520,000 | ​ | 10.86 | ​ | ​ | 191,593 | ​ | 4.00 | ​ | ​ | 191,593 | ​ | 4.00 | ​ | ​ | 239,491 | ​ | 5.00 | ​

​

The Company and the Bank must maintain a capital conservation buffer, as defined by regulatory guidelines, in order to avoid limitations on capital distributions, including dividend payments, stock repurchases and certain discretionary bonus payments to executive officers.

​

Note 13: Fair Value Measurement

The Company categorizes its assets and liabilities measured at fair value into a three-level hierarchy based on the priority of the inputs to the valuation technique used to determine fair value. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used in the determination of the fair value measurement fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement. Assets and liabilities valued at fair value are categorized based on the inputs to the valuation techniques as follows:

Level 1 – Inputs that utilized quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access.

Level 2 – Inputs that include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instruments. Fair values for these instruments are estimated using pricing models, quoted prices of securities with similar characteristics, or discounted cash flows.

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Level 3 – Inputs that are unobservable for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity.

Subsequent to initial recognition, the Company may re-measure the carrying value of assets and liabilities measured on a nonrecurring basis to fair value. Adjustments to fair value usually result when certain assets are impaired. Such assets are written down from their carrying amounts to their fair value.

Professional standards allow entities the irrevocable option to elect to measure certain financial instruments and other items at fair value for the initial and subsequent measurement on an instrument-by-instrument basis. The Company adopted the policy to value certain financial instruments at fair value. The Company has not elected to measure any existing financial instruments at fair value; however, it may elect to measure newly acquired financial instruments at fair value in the future.

Recurring Basis

The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. There have been no changes in methodologies used as of September 30, 2025. The following tables present the balances of assets and liabilities measured at fair value on a recurring basis as of September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025
(dollars in thousands) |  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Fair Value of Financial Assets: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Securities Available for Sale: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
U.S. Treasury Securities | ​ | $ | 147,199 | ​ | $ | — | ​ | $ | — | ​ | $ | 147,199
Municipal Bonds | ​ | ​ | — | ​ | ​ | 240,547 | ​ | ​ | — | ​ | ​ | 240,547
Mortgage-Backed Securities | ​ | ​ | — | ​ | ​ | 259,149 | ​ | ​ | — | ​ | ​ | 259,149
Corporate Securities | ​ | ​ | — | ​ | ​ | 107,983 | ​ | ​ | — | ​ | ​ | 107,983
U.S. Government Agency Securities | ​ | ​ | — | ​ | ​ | 9,835 | ​ | ​ | — | ​ | ​ | 9,835
Asset-Backed Securities | ​ | ​ | — | ​ | ​ | 61,760 | ​ | ​ | — | ​ | ​ | 61,760
Fair Value Swaps | ​ | ​ | — | ​ | ​ | 7,546 | ​ | ​ | — | ​ | ​ | 7,546
Interest Rate Caps | ​ | ​ | — | ​ | ​ | 13,643 | ​ | ​ | — | ​ | ​ | 13,643
Interest Rate Swaps | ​ | ​ | — | ​ | ​ | 10,463 | ​ | ​ | — | ​ | ​ | 10,463
Total Fair Value of Financial Assets | ​ | $ | 147,199 | ​ | $ | 710,926 | ​ | $ | — | ​ | $ | 858,125
Fair Value of Financial Liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Fair Value Swaps | ​ | $ | — | ​ | $ | 768 | ​ | $ | — | ​ | $ | 768
Interest Rate Swaps | ​ | ​ | — | ​ | ​ | 9,827 | ​ | ​ | — | ​ | ​ | 9,827
Risk Participation Agreement | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 17 | ​ | ​ | 17
Total Fair Value of Financial Liabilities | ​ | $ | — | ​ | $ | 10,595 | ​ | $ | 17 | ​ | $ | 10,612

​

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​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | December 31, 2024
(dollars in thousands) |  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Fair Value of Financial Assets: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Securities Available for Sale: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
U.S. Treasury Securities | ​ | $ | 167,748 | ​ | $ | — | ​ | $ | — | ​ | $ | 167,748
Municipal Bonds | ​ | ​ | — | ​ | ​ | 122,265 | ​ | ​ | — | ​ | ​ | 122,265
Mortgage-Backed Securities | ​ | ​ | — | ​ | ​ | 244,890 | ​ | ​ | — | ​ | ​ | 244,890
Corporate Securities | ​ | ​ | — | ​ | ​ | 134,186 | ​ | ​ | — | ​ | ​ | 134,186
U.S. Government Agency Securities | ​ | ​ | — | ​ | ​ | 22,082 | ​ | ​ | — | ​ | ​ | 22,082
Asset-Backed Securities | ​ | ​ | — | ​ | ​ | 77,076 | ​ | ​ | — | ​ | ​ | 77,076
Fair Value Swaps | ​ | ​ | — | ​ | ​ | 10,487 | ​ | ​ | — | ​ | ​ | 10,487
Interest Rate Caps | ​ | ​ | — | ​ | ​ | 19,319 | ​ | ​ | — | ​ | ​ | 19,319
Interest Rate Swaps | ​ | ​ | — | ​ | ​ | 13,349 | ​ | ​ | — | ​ | ​ | 13,349
Total Fair Value of Financial Assets | ​ | $ | 167,748 | ​ | $ | 643,654 | ​ | $ | — | ​ | $ | 811,402
Fair Value of Financial Liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest Rate Swaps | ​ | $ | — | ​ | $ | 8,210 | ​ | $ | — | ​ | $ | 8,210
Total Fair Value of Financial Liabilities | ​ | $ | — | ​ | $ | 8,210 | ​ | $ | — | ​ | $ | 8,210

​

Investment Securities

When available, the Company uses quoted market prices to determine the fair value of investment securities; such items are classified in Level 1 of the fair value hierarchy.

For the Company’s investments, when quoted prices are not available for identical securities in an active market, the Company determines fair value utilizing vendors who apply matrix pricing for similar bonds where no price is observable or may compile prices from various sources. These models are primarily industry-standard models that consider various assumptions, including time value, yield curve, volatility factors, prepayment speeds, default rates, loss severity, current market, and contractual prices for the underlying financial instruments, as well as other relevant economic measures. Substantially, all of these assumptions are observable in the marketplace and can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. Fair values from these models are verified, where possible, against quoted market prices for recent trading activity of assets with similar characteristics to the security being valued. Such methods are generally classified as Level 2. However, when prices from independent sources vary, or cannot be obtained or corroborated, a security is generally classified as Level 3.

Fair Value Swaps

Fair value swaps are traded in over-the-counter markets where quoted market prices are not readily available. For such fair value swaps, fair value is determined using internally developed models of a third party that uses primarily market observable inputs, such as yield curves and option volatilities, and accordingly are valued using Level 2 inputs.

Interest Rate Caps

The fair value of the caps is calculated by determining the total expected asset or liability exposure of the derivatives. Total expected exposure incorporates both the current and potential future exposure of the derivative, derived from using observable inputs, such as yield curves and volatilities, and accordingly are valued using Level 2 inputs.

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Interest Rate Swaps

Interest rate swaps are traded in over-the-counter markets where quoted market prices are not readily available. For those interest rate swaps, fair value is determined using internally developed models of a third party that uses primarily market observable inputs, such as yield curves and option volatilities, and accordingly are valued using Level 2 inputs.

Risk Participation Agreements

The fair value of risk participation agreements is calculated by determining the total expected asset or liability exposure using observable inputs, such as yield curves and volatilities, of the derivative to the borrower and applying an unobservable credit default probability to that exposure, and accordingly are valued using level 3 inputs.

Nonrecurring Basis

Certain assets are measured at fair value on a nonrecurring basis. These assets are not measured at fair value on an ongoing basis; however, they are subject to fair value adjustments in certain circumstances, such as when there is evidence of impairment or a change in the amount of previously recognized impairment.

The following tables present net credit losses related to nonrecurring fair value measurements of certain assets at September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025
(dollars in thousands) |  | Level 1 |  | Level 2 |  | Level 3 |  | Loss
Individually Evaluated Loans | ​ | $ | — | ​ | $ | — | ​ | $ | 16,222 | ​ | $ | 4,457
Totals | ​ | $ | — | ​ | $ | — | ​ | $ | 16,222 | ​ | $ | 4,457

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | December 31, 2024
(dollars in thousands) |  | Level 1 |  | Level 2 |  | Level 3 |  | Loss
Individually Evaluated Loans | ​ | $ | — | ​ | $ | — | ​ | $ | 91 | ​ | $ | 44
Totals | ​ | $ | — | ​ | $ | — | ​ | $ | 91 | ​ | $ | 44

​

Individually Evaluated Loans

The Company records certain loans at fair value on a non-recurring basis. Individually evaluated loans for which an allowance is established, or a write-down has occurred during the period, based on the fair value of collateral require classification in the fair value hierarchy. The fair value of the loan’s collateral is determined by appraisals, independent valuation and other techniques. When the fair value of the loan’s collateral is based on an observable market price the Company classifies the fair value of the individually evaluated loans within Level 2 of the valuation hierarchy. For loans in which the valuation has unobservable inputs, the Company classifies these within the Level 3 of the valuation hierarchy. As of September 30, 2025, collateral values were estimated using a combination of observable inputs, including recent appraisals, and unobservable inputs, including internally determined values based on cost adjusted for depreciation and customized discounting criteria on appraisals which ranged from 4-25%. Due to the significance of unobservable inputs, fair values of individually evaluated loans have been classified as Level 3.

​

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Fair Value

Disclosure of fair value information about financial instruments, for which it is practicable to estimate that value, is required whether or not recognized in the consolidated balance sheets. In cases where quoted market prices are not available, fair values are based on estimates using present value of cash flow or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimate of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases could not be realized in immediate settlement of the instruments. Certain financial instruments with a fair value that is not practicable to estimate and all non-financial instruments are excluded from the disclosure requirements. Accordingly, the aggregate fair value amounts presented do not necessarily represent the underlying value of the Company.

Fair value estimates are made at a specific point in time based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular instrument. Because no market exists for a significant portion of the Company’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters that could affect the estimates. Fair value estimates are based on existing on and off-balance sheet financial instruments without attempting to estimate the value of anticipated future business. Deposits with no stated maturities are defined as having a fair value equivalent to the amount payable on demand. This prohibits adjusting fair value derived from retaining those deposits for an expected future period of time. This component, commonly referred to as a deposit base intangible, is neither considered in the above amounts nor is it recorded as an intangible asset on the balance sheet. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in the estimates.

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The following tables present the carrying amounts and estimated fair values of financial instruments at September 30, 2025 and December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025
​ | ​ | ​ | ​ | ​ | Fair Value Hierarchy | ​ | ​ | ​
​ | ​ | Carrying | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Estimated
(dollars in thousands) |  | Amount |  | Level 1 |  | Level 2 |  | Level 3 |  | Fair Value
Financial Assets: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash and Due From Banks | ​ | $ | 131,818 | ​ | $ | 131,818 | ​ | $ | — | ​ | $ | — | ​ | $ | 131,818
Bank-Owned Certificates of Deposit | ​ | ​ | 3,658 | ​ | ​ | — | ​ | ​ | 3,675 | ​ | ​ | — | ​ | ​ | 3,675
Securities Available for Sale | ​ | ​ | 826,473 | ​ | ​ | 147,199 | ​ | ​ | 679,274 | ​ | ​ | — | ​ | ​ | 826,473
FHLB Stock, at Cost | ​ | ​ | 21,373 | ​ | ​ | — | ​ | ​ | 21,373 | ​ | ​ | — | ​ | ​ | 21,373
Loans, Net | ​ | ​ | 4,149,882 | ​ | ​ | — | ​ | ​ | 4,069,195 | ​ | ​ | 16,222 | ​ | ​ | 4,085,417
Accrued Interest Receivable | ​ | ​ | 19,244 | ​ | ​ | — | ​ | ​ | 19,244 | ​ | ​ | — | ​ | ​ | 19,244
Fair Value Swaps | ​ | ​ | 7,546 | ​ | ​ | — | ​ | ​ | 7,546 | ​ | ​ | — | ​ | ​ | 7,546
Interest Rate Caps | ​ | ​ | 13,643 | ​ | ​ | — | ​ | ​ | 13,643 | ​ | ​ | — | ​ | ​ | 13,643
Interest Rate Swaps | ​ | ​ | 10,463 | ​ | ​ | — | ​ | ​ | 10,463 | ​ | ​ | — | ​ | ​ | 10,463
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Financial Liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Deposits | ​ | $ | 4,292,764 | ​ | $ | — | ​ | $ | 4,295,375 | ​ | $ | — | ​ | $ | 4,295,375
FHLB Advances | ​ | ​ | 404,500 | ​ | ​ | — | ​ | ​ | 404,710 | ​ | ​ | — | ​ | ​ | 404,710
Subordinated Debentures | ​ | ​ | 108,588 | ​ | ​ | — | ​ | ​ | 104,304 | ​ | ​ | — | ​ | ​ | 104,304
Accrued Interest Payable | ​ | ​ | 5,208 | ​ | ​ | — | ​ | ​ | 5,208 | ​ | ​ | — | ​ | ​ | 5,208
Fair Value Swaps | ​ | ​ | 768 | ​ | ​ | — | ​ | ​ | 768 | ​ | ​ | — | ​ | ​ | 768
Interest Rate Swaps | ​ | ​ | 9,827 | ​ | ​ | — | ​ | ​ | 9,827 | ​ | ​ | — | ​ | ​ | 9,827
Risk Participation Agreement | ​ | ​ | 17 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 17 | ​ | ​ | 17

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | December 31, 2024
​ | ​ | ​ | ​ | ​ | Fair Value Hierarchy | ​ | ​ | ​
​ | ​ | Carrying | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Estimated
(dollars in thousands) |  | Amount |  | Level 1 |  | Level 2 |  | Level 3 |  | Fair Value
Financial Assets: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash and Due From Banks | ​ | $ | 229,760 | ​ | $ | 229,760 | ​ | $ | — | ​ | $ | — | ​ | $ | 229,760
Bank-Owned Certificates of Deposit | ​ | ​ | 4,377 | ​ | ​ | — | ​ | ​ | 4,370 | ​ | ​ | — | ​ | ​ | 4,370
Securities Available for Sale | ​ | ​ | 768,247 | ​ | ​ | 167,748 | ​ | ​ | 600,499 | ​ | ​ | — | ​ | ​ | 768,247
FHLB Stock, at Cost | ​ | ​ | 19,297 | ​ | ​ | — | ​ | ​ | 19,297 | ​ | ​ | — | ​ | ​ | 19,297
Loans, Net | ​ | ​ | 3,809,436 | ​ | ​ | — | ​ | ​ | 3,709,775 | ​ | ​ | 91 | ​ | ​ | 3,709,866
Accrued Interest Receivable | ​ | ​ | 17,711 | ​ | ​ | — | ​ | ​ | 17,711 | ​ | ​ | — | ​ | ​ | 17,711
Fair Value Swaps | ​ | ​ | 10,487 | ​ | ​ | — | ​ | ​ | 10,487 | ​ | ​ | — | ​ | ​ | 10,487
Interest Rate Caps | ​ | ​ | 19,319 | ​ | ​ | — | ​ | ​ | 19,319 | ​ | ​ | — | ​ | ​ | 19,319
Interest Rate Swaps | ​ | ​ | 13,349 | ​ | ​ | — | ​ | ​ | 13,349 | ​ | ​ | — | ​ | ​ | 13,349
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Financial Liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Deposits | ​ | $ | 4,086,767 | ​ | $ | — | ​ | $ | 4,131,298 | ​ | $ | — | ​ | $ | 4,131,298
Notes Payable | ​ | ​ | 13,750 | ​ | ​ | — | ​ | ​ | 13,775 | ​ | ​ | — | ​ | ​ | 13,775
FHLB Advances | ​ | ​ | 359,500 | ​ | ​ | — | ​ | ​ | 358,759 | ​ | ​ | — | ​ | ​ | 358,759
Subordinated Debentures | ​ | ​ | 79,670 | ​ | ​ | — | ​ | ​ | 76,056 | ​ | ​ | — | ​ | ​ | 76,056
Accrued Interest Payable | ​ | ​ | 4,008 | ​ | ​ | — | ​ | ​ | 4,008 | ​ | ​ | — | ​ | ​ | 4,008
Interest Rate Swaps | ​ | ​ | 8,210 | ​ | ​ | — | ​ | ​ | 8,210 | ​ | ​ | — | ​ | ​ | 8,210

​

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The following methods and assumptions were used by the Company to estimate fair value of financial instruments not previously discussed.

Cash and due from banks – The carrying amount of cash and cash equivalents approximates their fair value.

Bank-owned certificates of deposit – Fair values of bank-owned certificates of deposit are estimated using the discounted cash flow analysis based on current rates for similar types of deposits.

​

FHLB stock – The carrying amount of FHLB stock approximates its fair value.

Loans, net – Fair values for loans are estimated based on discounted cash flows, using interest rates currently being offered for loans with similar terms to borrowers with similar credit quality.

Accrued interest receivable – The carrying amount of accrued interest receivable approximates its fair value since it is short term in nature and does not present anticipated credit concerns.

Deposits – The fair values disclosed for demand deposits without stated maturities (interest and noninterest transaction, savings, and money market accounts) are equal to the amount payable on demand at the reporting date (their carrying amounts). Fair values for the fixed-rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities on time deposits.

Notes payable and subordinated debentures – The fair values of the Company’s notes payable and subordinated debentures are estimated using a discounted cash flow analysis, based on the Company’s current incremental borrowing rate for similar types of borrowing arrangements.

FHLB advances – The fair values of the Company’s FHLB advances are estimated using discounted cash flow analysis based on the Company’s current incremental borrowing rates for similar types of borrowing agreements.

Accrued interest payable – The carrying amount of accrued interest payable approximates its fair value since it is short term in nature.

Off-balance sheet instruments – Fair values of the Company’s off-balance sheet instruments (lending commitments and unused lines of credit) are based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements, the counterparties’ credit standing and discounted cash flow analysis. The fair value of these off-balance sheet items approximates the recorded amounts of the related fees and was not material at September 30, 2025 and December 31, 2024.

Limitations – The fair value of a financial instrument is the current amount that would be exchanged between market participants, other than in a forced liquidation. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument. Consequently, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Company.

​

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Note 14: Accumulated Other Comprehensive Income

The following tables present the components of other comprehensive income for the three and nine months ended September 30, 2025 and 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(dollars in thousands) | ​ | Before Tax | ​ | Tax Effect | ​ | Net of Tax
Three Months Ended September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Unrealized Gain on Available for Sale Securities | ​ | $ | 13,860 | ​ | $ | (3,984) | ​ | $ | 9,876
Less: Reclassification Adjustment for Net Gains Included in Net Income | ​ | ​ | (59) | ​ | ​ | 17 | ​ | ​ | (42)
Total Unrealized Gain | ​ | ​ | 13,801 | ​ | ​ | (3,967) | ​ | ​ | 9,834
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Unrealized Loss on Cash Flow Hedge | ​ | ​ | (41) | ​ | ​ | 12 | ​ | ​ | (29)
Less: Reclassification Adjustment for Gains Included in Net Income | ​ | ​ | (1,600) | ​ | ​ | 460 | ​ | ​ | (1,140)
Total Unrealized Loss | ​ | ​ | (1,641) | ​ | ​ | 472 | ​ | ​ | (1,169)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other Comprehensive Income | ​ | $ | 12,160 | ​ | $ | (3,495) | ​ | $ | 8,665
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Three Months Ended September 30, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Unrealized Gain on Available for Sale Securities | ​ | $ | 14,738 | ​ | $ | (4,236) | ​ | $ | 10,502
Less: Reclassification Adjustment for Net Losses Included in Net Income | ​ | ​ | 28 | ​ | ​ | (8) | ​ | ​ | 20
Total Unrealized Gain | ​ | ​ | 14,766 | ​ | ​ | (4,244) | ​ | ​ | 10,522
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Unrealized Loss on Cash Flow Hedge | ​ | ​ | (6,761) | ​ | ​ | 1,943 | ​ | ​ | (4,818)
Less: Reclassification Adjustment for Gains Included in Net Income | ​ | ​ | (2,526) | ​ | ​ | 726 | ​ | ​ | (1,800)
Total Unrealized Loss | ​ | ​ | (9,287) | ​ | ​ | 2,669 | ​ | ​ | (6,618)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other Comprehensive Income | ​ | $ | 5,479 | ​ | $ | (1,575) | ​ | $ | 3,904

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(dollars in thousands) | ​ | Before Tax | ​ | Tax Effect | ​ | Net of Tax
Nine Months Ended September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Unrealized Gain on Available for Sale Securities | ​ | $ | 21,068 | ​ | $ | (6,055) | ​ | $ | 15,013
Less: Reclassification Adjustment for Net Gains Included in Net Income | ​ | ​ | (534) | ​ | ​ | 154 | ​ | ​ | (380)
Total Unrealized Gain | ​ | ​ | 20,534 | ​ | ​ | (5,901) | ​ | ​ | 14,633
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Unrealized Loss on Cash Flow Hedge | ​ | ​ | (4,538) | ​ | ​ | 1,304 | ​ | ​ | (3,234)
Less: Reclassification Adjustment for Gains Included in Net Income | ​ | ​ | (5,049) | ​ | ​ | 1,451 | ​ | ​ | (3,598)
Total Unrealized Loss | ​ | ​ | (9,587) | ​ | ​ | 2,755 | ​ | ​ | (6,832)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other Comprehensive Income | ​ | $ | 10,947 | ​ | $ | (3,146) | ​ | $ | 7,801
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Nine Months Ended September 30, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Unrealized Gain on Available for Sale Securities | ​ | $ | 16,141 | ​ | $ | (4,639) | ​ | $ | 11,502
Less: Reclassification Adjustment for Net Gains Included in Net Income | ​ | ​ | (385) | ​ | ​ | 111 | ​ | ​ | (274)
Total Unrealized Gain | ​ | ​ | 15,756 | ​ | ​ | (4,528) | ​ | ​ | 11,228
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Unrealized Gain on Cash Flow Hedge | ​ | ​ | 987 | ​ | ​ | (284) | ​ | ​ | 703
Less: Reclassification Adjustment for Gains Included in Net Income | ​ | ​ | (7,158) | ​ | ​ | 2,057 | ​ | ​ | (5,101)
Total Unrealized Loss | ​ | ​ | (6,171) | ​ | ​ | 1,773 | ​ | ​ | (4,398)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other Comprehensive Income | ​ | $ | 9,585 | ​ | $ | (2,755) | ​ | $ | 6,830

​

​

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The following tables present the changes in each component of accumulated other comprehensive income, net of tax, for the three and nine months ended September 30, 2025 and 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | Accumulated
​ | ​ | Available For | ​ | ​ | ​ | ​ | Other Comprehensive
(dollars in thousands) | ​ | Sale Securities | ​ | Cash Flow Hedge | ​ | Income (Loss)
Three Months Ended September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Balance at Beginning of Period | ​ | $ | (22,944) | ​ | $ | 8,716 | ​ | $ | (14,228)
Other Comprehensive (Loss) Before Reclassifications | ​ | ​ | 9,876 | ​ | ​ | (29) | ​ | ​ | 9,847
Amounts Reclassified from Accumulated Other Comprehensive Income | ​ | ​ | (42) | ​ | ​ | (1,140) | ​ | ​ | (1,182)
Net Other Comprehensive Income (Loss) During Period | ​ | ​ | 9,834 | ​ | ​ | (1,169) | ​ | ​ | 8,665
Balance at End of Period | ​ | $ | (13,110) | ​ | $ | 7,547 | ​ | $ | (5,563)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Three Months Ended September 30, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Balance at Beginning of Period | ​ | $ | (31,014) | ​ | $ | 15,694 | ​ | $ | (15,320)
Other Comprehensive Income (Loss) Before Reclassifications | ​ | ​ | 10,502 | ​ | ​ | (4,818) | ​ | ​ | 5,684
Amounts Reclassified from Accumulated Other Comprehensive Income | ​ | ​ | 20 | ​ | ​ | (1,800) | ​ | ​ | (1,780)
Net Other Comprehensive Income (Loss) During Period | ​ | ​ | 10,522 | ​ | ​ | (6,618) | ​ | ​ | 3,904
Balance at End of Period | ​ | $ | (20,492) | ​ | $ | 9,076 | ​ | $ | (11,416)

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | Accumulated
​ | ​ | Available For | ​ | ​ | ​ | ​ | Other Comprehensive
(dollars in thousands) | ​ | Sale Securities | ​ | Cash Flow Hedge | ​ | Income (Loss)
Nine Months Ended September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Balance at Beginning of Period | ​ | $ | (27,743) | ​ | $ | 14,379 | ​ | $ | (13,364)
Other Comprehensive Income (Loss) Before Reclassifications | ​ | ​ | 15,013 | ​ | ​ | (3,234) | ​ | ​ | 11,779
Amounts Reclassified from Accumulated Other Comprehensive Income | ​ | ​ | (380) | ​ | ​ | (3,598) | ​ | ​ | (3,978)
Net Other Comprehensive Income (Loss) During Period | ​ | ​ | 14,633 | ​ | ​ | (6,832) | ​ | ​ | 7,801
Balance at End of Period | ​ | $ | (13,110) | ​ | $ | 7,547 | ​ | $ | (5,563)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Nine Months Ended September 30, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Balance at Beginning of Period | ​ | $ | (31,720) | ​ | $ | 13,474 | ​ | $ | (18,246)
Other Comprehensive Income Before Reclassifications | ​ | ​ | 11,502 | ​ | ​ | 703 | ​ | ​ | 12,205
Amounts Reclassified from Accumulated Other Comprehensive Income | ​ | ​ | (274) | ​ | ​ | (5,101) | ​ | ​ | (5,375)
Net Other Comprehensive Income During Period | ​ | ​ | 11,228 | ​ | ​ | (4,398) | ​ | ​ | 6,830
Balance at End of Period | ​ | $ | (20,492) | ​ | $ | 9,076 | ​ | $ | (11,416)

​

​

​

​

Note 15: Subsequent Events

On October 21, 2025, the Company’s Board of Directors announced a quarterly cash dividend of $36.72 per share ($0.3672 per depositary share) on its 5.875% Non-Cumulative Perpetual Preferred Stock, Series A (“Series A Preferred Stock”), payable on December 1, 2025, to shareholders of record on the Series A Preferred Stock at the close of business on November 14, 2025.

​

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

General

The following discussion explains the Company’s financial condition and results of operations as of and for the three and nine months ended September 30, 2025. Annualized results for these interim periods may not be indicative of results for the full year or future periods. The following discussion and analysis should be read in conjunction with the consolidated financial statements and related notes presented elsewhere in this report and the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission, or the SEC, on March 6, 2025.

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, identified by words such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized”, “target” and “outlook”, or the negative version of those words or other comparable words of a future or forward-looking nature. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following:

​

| ● | interest rate risk, including the effects of changes in interest rates;

| ● | effects on the U.S. economy resulting from the threat or implementation of new, or changes to, existing policies, regulations, regulatory and governmental agencies and executive orders, including with respect to tariffs, immigration, DEI and ESG initiatives, consumer protection, foreign policy, and tax regulations;

| ● | fluctuations in the values of the securities held in our securities portfolio, including as the result of changes in interest rates;

| ● | business and economic conditions generally and in the financial services industry, nationally and within our market area, including the level and impact of inflation, including future monetary policies of the Federal Reserve in response thereto, and possible recession;

| ● | the effects of developments and events in the financial services industry, including the large-scale deposit withdrawals over a short period of time that resulted in several bank failures;

| ● | credit risk and risks from concentrations (by type of borrower, geographic area, collateral and industry) within the Company’s loan portfolio or large loans to certain borrowers (including CRE loans);

| ● | the overall health of the local and national real estate market;

| ● | our ability to successfully manage credit risk;

| ● | our ability to maintain an adequate level of allowance for credit losses on loans;

| ● | new or revised accounting standards as may be adopted by state and federal regulatory agencies, the Financial Accounting Standards Board, SEC or Public Company Accounting Oversight Board;

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| ● | the concentration of large deposits from certain clients, including those who have balances above current Federal Deposit Insurance Corporation (“FDIC”) insurance limits;

| ● | our ability to successfully manage liquidity risk, which may increase our dependence on non-core funding sources such as brokered deposits, and negatively impact our cost of funds;

| ● | our ability to raise additional capital to implement our business plan;

| ● | our ability to implement our growth strategy and manage costs effectively;

| ● | the composition of our senior leadership team and our ability to attract and retain key personnel;

| ● | talent and labor shortages and employee turnover;

| ● | the occurrence of fraudulent activity, breaches or failures of our or our third-party vendors’ information security controls or cybersecurity-related incidents, including as a result of sophisticated attacks using artificial intelligence and similar tools or as a result of insider fraud;

| ● | interruptions involving our information technology and telecommunications systems or third-party servicers;

| ● | competition in the financial services industry, including from nonbank competitors such as credit unions, “fintech” companies and digital asset service providers;

| ● | the effectiveness of our risk management framework;

| ● | rapid technological changes implemented by us and other parties in the financial services industry, including third-party vendors, which may be more difficult to implement or more expensive than anticipated or which may have unforeseen consequence to us and our customers, including the development and implementation of tools incorporating artificial intelligence;

| ● | the commencement, cost and outcome of litigation and other legal proceedings and regulatory actions against us;

| ● | the impact of recent and future legislative and regulatory changes, domestic or foreign;

| ● | risks related to climate change and the negative impact it may have on our customers and their businesses;

| ● | the imposition of tariffs or other governmental policies impacting the global supply chain and the value of products produced by our commercial borrowers;

| ● | severe weather, natural disasters, wide spread disease or pandemics, acts of war or terrorism or other adverse external events, including ongoing conflicts in the Middle East and the Russian invasion of Ukraine;

| ● | potential impairment to the goodwill the Company recorded in connection with acquisitions;

| ● | risks associated with our integration of FMCB, including the possibility that the merger may be more difficult or expensive to integrate than anticipated, and the effect of the merger on the Company’s customer and employee relationships and operating results;

| ● | changes to U.S. or state tax laws, regulations and governmental policies concerning the Company’s general business, including changes in interpretation or prioritization of such rules and regulations;

| ● | the impact of bank failures or adverse developments at other banks and related negative publicity about the banking industry in general on investor and depositor sentiment regarding the stability and liquidity of banks;

| ● | the effects of the current U.S. government shutdown and its impact on our customers; and

| ● | any other risks described in the “Risk Factors” sections of reports filed by the Company with the SEC.

The foregoing factors should not be construed as exhaustive and should be read together with the other cautionary statements included in this report. In addition, past results of operations are not necessarily indicative of

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future results. Any forward-looking statement made by us in this report is based only on information currently available to us and speaks only as of the date on which it is made. The Company undertakes no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

Overview

The Company is a financial holding company headquartered in St. Louis Park, Minnesota. The principal sources of funds for loans and investments are transaction, savings, time, and other deposits, and short-term and long-term borrowings. The Company’s principal sources of income are interest and fees collected on loans, interest and dividends earned on investment securities and service charges. The Company’s principal expenses are interest paid on deposit accounts and borrowings, employee compensation and other overhead expenses. The Company’s simple, efficient business model of providing responsive support and unconventional experiences to clients continues to be the underlying principle that drives the Company’s profitable growth.

Critical Accounting Policies and Estimates

The consolidated financial statements of the Company are prepared based on the application of certain accounting policies, the most significant of which are described in “Note 1 – Description of the Business and Summary of Significant Accounting Policies” of the notes to the consolidated financial statements included as a part of the Company’s most recent Annual Report on Form 10-K, filed with the SEC on March 6, 2025. There have been no significant changes in the critical accounting policies or the assumptions and judgments utilized in applying these policies since December 31, 2024. Certain policies require numerous estimates and strategic or economic assumptions that may prove inaccurate or subject to variation and may significantly affect the reported results and financial position for the current period or in future periods. Changes in underlying factors, assumptions or estimates in any of these areas could have a material impact on the future financial condition and results of operations. Management has discussed each critical accounting policy and the methodology for the identification and determination of critical accounting policies with the Company’s Audit Committee.

Recent Developments

On December 13, 2024, the Company's wholly-owned banking subsidiary, Bridgewater Bank, completed its

acquisition of FMCB in an all-cash transaction. On the closing date, FMCB merged with and into Bridgewater Bank, with Bridgewater Bank as the surviving entity. The acquisition of FMCB aligns with and accelerates the Company’s strategic priorities, including its focus on continued growth within the Twin Cities market. The acquisition of FMCB added approximately $245.0 million of assets, $225.7 million of deposits, $117.1 million of loans and leases as of December 31, 2024, and two branch locations in Minnetonka, Minnesota. The acquisition also added an investment advisory business that offers nondeposit investment products through a third party arrangement. During the three and nine months ended September 30, 2025, the Company incurred merger-related expenses of $530,000 and $1.6 million, respectively. The acquisition may impact comparability between periods.

​

On June 24, 2025, the Company entered into a Subordinated Note Purchase Agreement with certain institutional accredited investors and qualified institutional buyers pursuant to which the Company sold and issued $80.0 million of aggregate principal amount of its 7.625% Fixed-to-Floating Rate Subordinated Notes due 2035. The Notes were issued by the Company to such purchasers at a price equal to 100% of their face amount. The Company used the net proceeds it received from the sale of the Notes to redeem $50 million of outstanding 5.25% Fixed-to-Floating Rate Subordinated Notes due 2030 and for general corporate purposes.

​

On July 4, 2025, the President signed H.R. 1, the “One Big Beautiful Bill Act,” into law. The legislation includes several changes to federal tax law that generally allow for more favorable deductibility of certain business expenses beginning in 2025, including the restoration of immediate expensing of domestic research and development

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expenditures, reinstatement of 100% bonus depreciation, and more favorable rules for determining the limitation on business interest expense. The financial impact was immaterial to the financial statements.

​

On September 30, 2025, the Company announced its plan to close its Country Village branch location, effective December 29, 2025, given the close proximity to its Glen Lake branch in Minnetonka, Minnesota.

​

Operating Results Overview

The following table summarizes certain key financial results as of and for the periods indicated:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | As of and for the Three Months Ended | ​
​ | ​ | September 30, | ​ | June 30, | ​ | March 31, | ​ | December 31, | ​ | September 30, | ​
(dollars in thousands, except per share data) | ​ | 2025 | ​ | 2025 | ​ | 2025 | ​ | 2024 | ​ | 2024 | ​
Income Statement | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Interest Income | ​ | $ | 34,091 | ​ | $ | 32,452 | ​ | $ | 30,208 | ​ | $ | 26,967 | ​ | $ | 25,599 | ​
Provision for Credit Losses | ​ | ​ | 1,100 | ​ | ​ | 2,000 | ​ | ​ | 1,500 | ​ | ​ | 2,175 | ​ | ​ | — | ​
Noninterest Income | ​ | ​ | 2,061 | ​ | ​ | 3,627 | ​ | ​ | 2,079 | ​ | ​ | 2,533 | ​ | ​ | 1,522 | ​
Noninterest Expense | ​ | ​ | 19,956 | ​ | ​ | 18,941 | ​ | ​ | 18,136 | ​ | ​ | 16,812 | ​ | ​ | 15,760 | ​
Net Income | ​ | ​ | 11,601 | ​ | ​ | 11,520 | ​ | ​ | 9,633 | ​ | ​ | 8,204 | ​ | ​ | 8,675 | ​
Net Income Available to Common Shareholders | ​ | ​ | 10,588 | ​ | ​ | 10,506 | ​ | ​ | 8,620 | ​ | ​ | 7,190 | ​ | ​ | 7,662 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Per Common Share Data | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Basic Earnings Per Share | ​ | $ | 0.38 | ​ | $ | 0.38 | ​ | $ | 0.31 | ​ | $ | 0.26 | ​ | $ | 0.28 | ​
Diluted Earnings Per Share | ​ | ​ | 0.38 | ​ | ​ | 0.38 | ​ | ​ | 0.31 | ​ | ​ | 0.26 | ​ | ​ | 0.27 | ​
Adjusted Diluted Earnings Per Share (1) | ​ | ​ | 0.39 | ​ | ​ | 0.37 | ​ | ​ | 0.32 | ​ | ​ | 0.27 | ​ | ​ | 0.28 | ​
Book Value Per Share | ​ | ​ | 15.62 | ​ | ​ | 14.92 | ​ | ​ | 14.60 | ​ | ​ | 14.21 | ​ | ​ | 14.06 | ​
Tangible Book Value Per Share (1) | ​ | ​ | 14.93 | ​ | ​ | 14.21 | ​ | ​ | 13.89 | ​ | ​ | 13.49 | ​ | ​ | 13.96 | ​
Basic Weighted Average Shares Outstanding | ​ | ​ | 27,504,840 | ​ | ​ | 27,460,982 | ​ | ​ | 27,568,772 | ​ | ​ | 27,459,433 | ​ | ​ | 27,382,798 | ​
Diluted Weighted Average Shares Outstanding | ​ | ​ | 28,190,406 | ​ | ​ | 27,998,008 | ​ | ​ | 28,036,506 | ​ | ​ | 28,055,532 | ​ | ​ | 27,904,910 | ​
Shares Outstanding at Period End | ​ | ​ | 27,584,732 | ​ | ​ | 27,470,283 | ​ | ​ | 27,560,150 | ​ | ​ | 27,552,449 | ​ | ​ | 27,425,690 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Selected Performance Ratios | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Return on Average Assets (2) | ​ | ​ | 0.86 | % | ​ | 0.90 | % | ​ | 0.77 | % | ​ | 0.68 | % | ​ | 0.73 | %
Pre-Provision Net Revenue Return on Average Assets (1)(2) | ​ | ​ | 1.19 | ​ | ​ | 1.27 | ​ | ​ | 1.13 | ​ | ​ | 1.05 | ​ | ​ | 0.96 | ​
Return on Average Shareholders' Equity (2) | ​ | ​ | 9.47 | ​ | ​ | 9.80 | ​ | ​ | 8.39 | ​ | ​ | 7.16 | ​ | ​ | 7.79 | ​
Return on Average Tangible Common Equity (1)(2) | ​ | ​ | 10.50 | ​ | ​ | 10.93 | ​ | ​ | 9.22 | ​ | ​ | 7.43 | ​ | ​ | 8.16 | ​
Average Shareholders' Equity to Average Assets | ​ | ​ | 9.04 | ​ | ​ | 9.14 | ​ | ​ | 9.18 | ​ | ​ | 9.52 | ​ | ​ | 9.42 | ​
Net Interest Margin (3) | ​ | ​ | 2.63 | ​ | ​ | 2.62 | ​ | ​ | 2.51 | ​ | ​ | 2.32 | ​ | ​ | 2.24 | ​
Core Net Interest Margin (1)(3) | ​ | ​ | 2.52 | ​ | ​ | 2.49 | ​ | ​ | 2.37 | ​ | ​ | 2.24 | ​ | ​ | 2.16 | ​
Yield on Interest Earning Assets(3) | ​ | ​ | 5.63 | ​ | ​ | 5.56 | ​ | ​ | 5.43 | ​ | ​ | 5.40 | ​ | ​ | 5.48 | ​
Yield on Total Loans, Gross(3) | ​ | ​ | 5.79 | ​ | ​ | 5.74 | ​ | ​ | 5.61 | ​ | ​ | 5.55 | ​ | ​ | 5.57 | ​
Cost of Interest Bearing Liabilities | ​ | ​ | 3.89 | ​ | ​ | 3.83 | ​ | ​ | 3.82 | ​ | ​ | 4.06 | ​ | ​ | 4.27 | ​
Cost of Total Deposits | ​ | ​ | 3.19 | ​ | ​ | 3.16 | ​ | ​ | 3.18 | ​ | ​ | 3.40 | ​ | ​ | 3.58 | ​
Cost of Funds | ​ | ​ | 3.25 | ​ | ​ | 3.19 | ​ | ​ | 3.17 | ​ | ​ | 3.38 | ​ | ​ | 3.54 | ​
Efficiency Ratio (1) | ​ | ​ | 54.7 | ​ | ​ | 52.6 | ​ | ​ | 55.5 | ​ | ​ | 56.8 | ​ | ​ | 58.0 | ​
Noninterest Expense to Average Assets (2) | ​ | ​ | 1.47 | ​ | ​ | 1.47 | ​ | ​ | 1.45 | ​ | ​ | 1.40 | ​ | ​ | 1.33 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Adjusted Financial Ratios (1) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Adjusted Return on Average Assets | ​ | ​ | 0.88 | % | ​ | 0.88 | % | ​ | 0.80 | % | ​ | 0.71 | % | ​ | 0.75 | %
Adjusted Pre-Provision Net Revenue Return on Average Assets (2) | ​ | ​ | 1.23 | ​ | ​ | 1.31 | ​ | ​ | 1.18 | ​ | ​ | 1.09 | ​ | ​ | 0.98 | ​
Adjusted Return on Average Shareholders' Equity | ​ | ​ | 9.77 | ​ | ​ | 9.64 | ​ | ​ | 8.77 | ​ | ​ | 7.49 | ​ | ​ | 7.96 | ​
Adjusted Return on Average Tangible Common Equity | ​ | ​ | 10.86 | ​ | ​ | 10.74 | ​ | ​ | 9.68 | ​ | ​ | 7.82 | ​ | ​ | 8.36 | ​
Adjusted Efficiency Ratio | ​ | ​ | 53.2 | ​ | ​ | 51.5 | ​ | ​ | 53.7 | ​ | ​ | 55.2 | ​ | ​ | 57.2 | ​
Adjusted Noninterest Expense to Average Assets | ​ | ​ | 1.43 | ​ | ​ | 1.43 | ​ | ​ | 1.41 | ​ | ​ | 1.36 | ​ | ​ | 1.31 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Balance Sheet | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Assets | ​ | $ | 5,359,994 | ​ | $ | 5,296,673 | ​ | $ | 5,136,808 | ​ | $ | 5,066,242 | ​ | $ | 4,691,517 | ​
Total Loans, Gross | ​ | ​ | 4,214,554 | ​ | ​ | 4,145,799 | ​ | ​ | 4,020,076 | ​ | ​ | 3,868,514 | ​ | ​ | 3,685,590 | ​
Deposits | ​ | ​ | 4,292,764 | ​ | ​ | 4,236,742 | ​ | ​ | 4,162,457 | ​ | ​ | 4,086,767 | ​ | ​ | 3,747,442 | ​
Total Shareholders' Equity | ​ | ​ | 497,463 | ​ | ​ | 476,282 | ​ | ​ | 468,975 | ​ | ​ | 457,935 | ​ | ​ | 452,200 | ​
Loan to Deposit Ratio | ​ | ​ | 98.2 | % | ​ | 97.9 | % | ​ | 96.6 | % | ​ | 94.7 | % | ​ | 98.3 | %
Core Deposits to Total Deposits (4) | ​ | ​ | 76.4 | ​ | ​ | 75.2 | ​ | ​ | 76.2 | ​ | ​ | 76.0 | ​ | ​ | 71.5 | ​
Uninsured Deposits to Total Deposits | ​ | ​ | 29.2 | ​ | ​ | 30.5 | ​ | ​ | 28.7 | ​ | ​ | 27.7 | ​ | ​ | 25.0 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Capital Ratios (Consolidated) (5) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Tier 1 Leverage Ratio | ​ | ​ | 9.02 | % | ​ | 9.14 | % | ​ | 9.10 | % | ​ | 9.45 | % | ​ | 9.75 | %
Common Equity Tier 1 Risk-based Capital Ratio | ​ | ​ | 9.08 | ​ | ​ | 9.03 | ​ | ​ | 9.03 | ​ | ​ | 9.08 | ​ | ​ | 9.79 | ​
Tier 1 Risk-based Capital Ratio | ​ | ​ | 10.52 | ​ | ​ | 10.51 | ​ | ​ | 10.55 | ​ | ​ | 10.64 | ​ | ​ | 11.44 | ​
Total Risk-based Capital Ratio | ​ | ​ | 14.12 | ​ | ​ | 14.17 | ​ | ​ | 13.62 | ​ | ​ | 13.76 | ​ | ​ | 14.62 | ​
Tangible Common Equity to Tangible Assets (1) | ​ | ​ | 7.71 | ​ | ​ | 7.40 | ​ | ​ | 7.48 | ​ | ​ | 7.36 | ​ | ​ | 8.17 | ​

​

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​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | As of and for the Three Months Ended | ​
​ | ​ | September 30, | ​ | June 30, | ​ | March 31, | ​ | December 31, | ​ | September 30, | ​
(dollars in thousands) | ​ | 2025 | ​ | 2025 | ​ | 2025 | ​ | 2024 | ​ | 2024 | ​
Selected Asset Quality Data | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Loans 30-89 Days Past Due | ​ | $ | 2,906 | ​ | $ | 12,492 |  | $ | 466 |  | $ | 1,291 |  | $ | 65 | ​
Loans 30-89 Days Past Due to Total Loans | ​ | ​ | 0.07 | % | ​ | 0.30 | % | ​ | 0.01 | % | ​ | 0.03 | % | ​ | 0.00 | %
Nonperforming Loans | ​ | $ | 9,991 | ​ | $ | 10,134 |  | $ | 10,290 |  | $ | 301 |  | $ | 8,378 | ​
Nonperforming Loans to Total Loans | ​ | ​ | 0.24 | % | ​ | 0.24 | % | ​ | 0.26 | % | ​ | 0.01 | % | ​ | 0.23 | %
Nonaccrual Loans to Total Loans | ​ | ​ | 0.24 | ​ | ​ | 0.24 | ​ | ​ | 0.26 | ​ | ​ | 0.01 | ​ | ​ | 0.23 | ​
Nonaccrual Loans and Loans Past Due 90 Days and Still Accruing to Total Loans | ​ | ​ | 0.24 | ​ | ​ | 0.24 | ​ | ​ | 0.26 | ​ | ​ | 0.01 | ​ | ​ | 0.23 | ​
Foreclosed Assets | ​ | $ | — | ​ | $ | 185 |  | $ | — |  | $ | — |  | $ | 434 | ​
Nonperforming Assets (6) | ​ | ​ | 9,991 | ​ | ​ | 10,319 |  | ​ | 10,290 |  | ​ | 301 |  | ​ | 8,812 | ​
Nonperforming Assets to Total Assets (6) | ​ | ​ | 0.19 | % | ​ | 0.19 | % | ​ | 0.20 | % | ​ | 0.01 | % | ​ | 0.19 | %
Allowance for Credit Losses on Loans to Total Loans | ​ | ​ | 1.34 | ​ | ​ | 1.35 | ​ | ​ | 1.34 | ​ | ​ | 1.35 | ​ | ​ | 1.38 | ​
Allowance for Credit Losses on Loans to Nonaccrual Loans | ​ | ​ | 564.41 | ​ | ​ | 550.28 | ​ | ​ | 522.51 | ​ | ​ | 17,367.77 | ​ | ​ | 608.95 | ​
Net Loan Charge-Offs (Annualized) to Average Loans (2) | ​ | ​ | 0.03 | ​ | ​ | 0.00 |  | ​ | 0.00 |  | ​ | 0.03 |  | ​ | 0.10 | ​
Watchlist/Special Mention Risk Rating Loans | ​ | $ | 40,642 | ​ | $ | 53,282 | ​ | $ | 38,346 | ​ | $ | 46,581 | ​ | $ | 31,991 | ​
Substandard Risk Rating Loans | ​ | ​ | 58,074 | ​ | ​ | 44,986 | ​ | ​ | 31,587 | ​ | ​ | 21,791 | ​ | ​ | 31,637 | ​

(1) | Represents a non-GAAP financial measure. See "Non-GAAP Financial Measures" for further details.

(2) | Annualized.

(3) | Amounts calculated on a tax-equivalent basis using the statutory federal tax rate of 21%.

(4) | Core deposits are defined as total deposits less brokered deposits and certificates of deposit greater than $250,000.

(5) | Preliminary data. Current period subject to change prior to filing with applicable regulatory filings.

(6) | Nonperforming assets are defined as nonaccrual loans plus 90 days past due plus foreclosed assets.

Discussion and Analysis of Results of Operations

Net Income

Net income was $11.6 million for the third quarter of 2025, compared to net income of $8.7 million for the third quarter of 2024. Earnings per diluted common share for the third quarter of 2025 were $0.38, compared to $0.27 per diluted common share for the third quarter of 2024. Adjusted net income, a non-GAAP financial measure, was $12.0 million for the third quarter of 2025, compared to $8.9 million for the third quarter of 2024. Adjusted earnings per diluted common share, a non-GAAP financial measure, for the third quarter of 2025 were $0.39, compared to $0.28 per diluted common share for the third quarter of 2024.

Net Interest Income

The Company’s primary source of revenue is net interest income, which is impacted by the level of interest earning assets and related funding sources, as well as changes in interest rates. The difference between the average yield on earning assets and the average rate paid for interest bearing liabilities is the net interest spread. Noninterest bearing sources of funds, such as demand deposits and shareholders’ equity, also support earning assets. The impact of the noninterest bearing sources of funds is captured in the net interest margin, which is calculated as net interest income divided by average earning assets. Both the net interest margin and net interest spread are presented on a tax-equivalent basis, which means that tax-free interest income has been adjusted to pretax-equivalent income, assuming a 21% federal tax rate. Management’s ability to respond to changes in interest rates by using effective asset-liability management techniques is critical to managing net interest margin and the Company’s primary source of earnings.

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Average Balances and Yields

The following tables present, for the three and nine months ended September 30, 2025 and 2024, the average balances of each principal category of assets, liabilities and shareholders’ equity, and an analysis of net interest income. The average balances are principally daily averages and, for loans, include both performing and nonperforming balances. Interest income on loans includes the effects of net deferred loan origination fees and costs accounted for as yield adjustments. These tables are presented on a tax-equivalent basis, if applicable.

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the Three Months Ended |
​ | ​ | September 30, 2025 | ​ | September 30, 2024 |
​ | ​ | Average | ​ | Interest | ​ | Yield/ | ​ | Average | ​ | Interest | ​ | Yield/ |
(dollars in thousands) |  | Balance |  | & Fees |  | Rate |  | Balance |  | & Fees |  | Rate |
Interest Earning Assets: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash Investments | ​ | $ | 256,174 | ​ | $ | 2,732 | ​ | 4.23 | % | $ | 157,114 | ​ | $ | 1,971 | ​ | 4.99 | %
Investment Securities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Taxable Investment Securities | ​ |  | 730,643 | ​ |  | 9,448 | ​ | 5.13 | ​ |  | 668,429 | ​ |  | 8,406 | ​ | 5.00 | ​
Tax-Exempt Investment Securities (1) | ​ |  | 81,962 | ​ |  | 1,168 | ​ | 5.66 | ​ |  | 31,496 | ​ |  | 402 | ​ | 5.08 | ​
Total Investment Securities | ​ |  | 812,605 | ​ |  | 10,616 | ​ | 5.18 | ​ |  | 699,925 | ​ |  | 8,808 | ​ | 5.01 | ​
Loans (1)(2) | ​ |  | 4,132,987 | ​ | ​ | 60,317 | ​ | 5.79 | ​ |  | 3,721,654 | ​ | ​ | 52,118 | ​ | 5.57 | ​
Federal Home Loan Bank Stock | ​ |  | 21,373 | ​ | ​ | 492 | ​ | 9.12 | ​ |  | 16,828 | ​ | ​ | 436 | ​ | 10.31 | ​
Total Interest Earning Assets | ​ |  | 5,223,139 | ​ |  | 74,157 | ​ | 5.63 | % |  | 4,595,521 | ​ |  | 63,333 | ​ | 5.48 | %
Noninterest Earning Assets | ​ | ​ | 149,304 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 108,283 | ​ | ​ | ​ | ​ | ​ | ​
Total Assets | ​ | $ | 5,372,443 | ​ | ​ | ​ | ​ | ​ | ​ | $ | 4,703,804 | ​ | ​ | ​ | ​ | ​ | ​
Interest Bearing Liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Deposits: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest Bearing Transaction Deposits | ​ | $ | 843,905 | ​ | $ | 8,037 | ​ | 3.78 | % | $ | 804,161 | ​ | $ | 9,369 | ​ | 4.63 | %
Savings and Money Market Deposits | ​ |  | 1,473,465 | ​ | ​ | 13,465 | ​ | 3.63 | ​ |  | 939,665 | ​ | ​ | 10,262 | ​ | 4.34 | ​
Time Deposits | ​ |  | 342,926 | ​ | ​ | 3,703 | ​ | 4.28 | ​ |  | 355,050 | ​ | ​ | 3,918 | ​ | 4.39 | ​
Brokered Deposits | ​ |  | 856,516 | ​ | ​ | 9,410 | ​ | 4.36 | ​ |  | 989,712 | ​ | ​ | 10,638 | ​ | 4.28 | ​
Total Interest Bearing Deposits | ​ | ​ | 3,516,812 | ​ | ​ | 34,615 | ​ | 3.90 | ​ | ​ | 3,088,588 | ​ | ​ | 34,187 | ​ | 4.40 | ​
Federal Funds Purchased | ​ |  | — | ​ | ​ | — | ​ | — | ​ |  | 141 | ​ | ​ | 2 | ​ | 5.72 | ​
Notes Payable | ​ |  | 5,679 | ​ | ​ | 106 | ​ | 7.40 | ​ |  | 13,750 | ​ | ​ | 296 | ​ | 8.58 | ​
FHLB Advances | ​ |  | 404,500 | ​ | ​ | 2,933 | ​ | 2.88 | ​ |  | 309,120 | ​ | ​ | 1,942 | ​ | 2.50 | ​
Subordinated Debentures | ​ |  | 108,639 | ​ | ​ | 1,888 | ​ | 6.89 | ​ |  | 79,519 | ​ | ​ | 1,001 | ​ | 5.01 | ​
Total Interest Bearing Liabilities | ​ |  | 4,035,630 | ​ |  | 39,542 | ​ | 3.89 | % |  | 3,491,118 | ​ |  | 37,428 | ​ | 4.27 | %
Noninterest Bearing Liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Noninterest Bearing Transaction Deposits | ​ |  | 793,760 | ​ | ​ | ​ | ​ | ​ | ​ |  | 710,192 | ​ | ​ | ​ | ​ | ​ | ​
Other Noninterest Bearing Liabilities | ​ | ​ | 57,184 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 59,417 | ​ | ​ | ​ | ​ | ​ | ​
Total Noninterest Bearing Liabilities | ​ |  | 850,944 | ​ | ​ | ​ | ​ | ​ | ​ |  | 769,609 | ​ | ​ | ​ | ​ | ​ | ​
Shareholders' Equity | ​ | ​ | 485,869 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 443,077 | ​ | ​ | ​ | ​ | ​ | ​
Total Liabilities and Shareholders' Equity | ​ | $ | 5,372,443 | ​ | ​ | ​ | ​ | ​ | ​ | $ | 4,703,804 | ​ | ​ | ​ | ​ | ​ | ​
Net Interest Income / Interest Rate Spread | ​ | ​ | ​ | ​ |  | 34,615 | ​ | 1.74 | % | ​ | ​ | ​ |  | 25,905 | ​ | 1.21 | %
Net Interest Margin (3) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 2.63 | % | ​ | ​ | ​ | ​ | ​ | ​ | 2.24 | %
Taxable Equivalent Adjustment: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Tax-Exempt Investment Securities and Loans | ​ | ​ | ​ | ​ |  | (524) | ​ | ​ | ​ | ​ | ​ | ​ |  | (306) | ​ | ​ | ​
Net Interest Income | ​ | ​ | ​ | ​ | $ | 34,091 | ​ | ​ | ​ | ​ | ​ | ​ | $ | 25,599 | ​ | ​ | ​

(1) | Interest income and average rates for tax-exempt investment securities and loans are presented on a tax-equivalent basis, assuming a federal income tax rate of 21%.

(2) | Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.

(3) | Net interest margin includes the tax equivalent adjustment and represents the annualized results of: (i) the difference between interest income on interest earning assets and the interest expense on interest bearing liabilities, divided by (ii) average interest earning assets for the period.

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​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the Nine Months Ended |
​ | ​ | September 30, 2025 | ​ | September 30, 2024 |
​ | ​ | Average | ​ | Interest | ​ | Yield/ | ​ | Average | ​ | Interest | ​ | Yield/ | ​
(dollars in thousands) |  | Balance |  | & Fees |  | Rate |  | Balance |  | & Fees |  | Rate |
Interest Earning Assets: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash Investments | ​ | $ | 210,525 | ​ | $ | 6,469 | ​ | 4.11 | % | $ | 104,831 | ​ | $ | 3,722 | ​ | 4.74 | %
Investment Securities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Taxable Investment Securities | ​ |  | 744,605 | ​ |  | 27,364 | ​ | 4.91 | ​ |  | 649,538 | ​ |  | 23,867 | ​ | 4.91 | ​
Tax-Exempt Investment Securities (1) | ​ |  | 49,987 | ​ |  | 2,030 | ​ | 5.43 | ​ |  | 31,597 | ​ |  | 1,203 | ​ | 5.09 | ​
Total Investment Securities | ​ |  | 794,592 | ​ |  | 29,394 | ​ | 4.95 | ​ |  | 681,135 | ​ |  | 25,070 | ​ | 4.92 | ​
Loans (1)(2) | ​ |  | 4,034,656 | ​ |  | 172,418 | ​ | 5.71 | ​ |  | 3,740,855 | ​ | ​ | 153,568 | ​ | 5.48 | ​
Federal Home Loan Bank Stock | ​ |  | 20,601 | ​ | ​ | 1,356 | ​ | 8.80 | ​ |  | 18,111 | ​ | ​ | 1,173 | ​ | 8.65 | ​
Total Interest Earning Assets | ​ |  | 5,060,374 | ​ |  | 209,637 | ​ | 5.54 | % |  | 4,544,932 | ​ |  | 183,533 | ​ | 5.39 | %
Noninterest Earning Assets | ​ | ​ | 145,373 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 102,993 | ​ | ​ | ​ | ​ | ​ | ​
Total Assets | ​ | $ | 5,205,747 | ​ | ​ | ​ | ​ | ​ | ​ | $ | 4,647,925 | ​ | ​ | ​ | ​ | ​ | ​
Interest Bearing Liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Deposits: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest Bearing Transaction Deposits | ​ | $ | 837,504 | ​ | $ | 23,995 | ​ | 3.83 | % | $ | 757,409 | ​ | $ | 25,332 | ​ | 4.47 | %
Savings and Money Market Deposits | ​ |  | 1,383,876 | ​ | ​ | 38,092 | ​ | 3.68 | ​ |  | 917,051 | ​ | ​ | 28,502 | ​ | 4.15 | ​
Time Deposits | ​ |  | 333,199 | ​ | ​ | 10,280 | ​ | 4.13 | ​ |  | 344,484 | ​ | ​ | 10,935 | ​ | 4.24 | ​
Brokered Deposits | ​ |  | 841,750 | ​ | ​ | 26,848 | ​ | 4.26 | ​ |  | 993,445 | ​ | ​ | 31,226 | ​ | 4.20 | ​
Total Interest Bearing Deposits | ​ | ​ | 3,396,329 | ​ | ​ | 99,215 | ​ | 3.91 | ​ | ​ | 3,012,389 | ​ | ​ | 95,995 | ​ | 4.26 | ​
Federal Funds Purchased | ​ |  | 456 | ​ | ​ | 16 | ​ | 4.64 | ​ |  | 27,605 | ​ | ​ | 1,159 | ​ | 5.61 | ​
Notes Payable | ​ |  | 11,030 | ​ | ​ | 624 | ​ | 7.57 | ​ |  | 13,750 | ​ | ​ | 887 | ​ | 8.62 | ​
FHLB Advances | ​ |  | 388,026 | ​ | ​ | 7,941 | ​ | 2.74 | ​ |  | 311,380 | ​ | ​ | 6,325 | ​ | 2.71 | ​
Subordinated Debentures | ​ |  | 90,853 | ​ | ​ | 3,992 | ​ | 5.87 | ​ |  | 79,424 | ​ | ​ | 2,982 | ​ | 5.02 | ​
Total Interest Bearing Liabilities | ​ |  | 3,886,694 | ​ |  | 111,788 | ​ | 3.85 | % |  | 3,444,548 | ​ |  | 107,348 | ​ | 4.16 | %
Noninterest Bearing Liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Noninterest Bearing Transaction Deposits | ​ |  | 779,897 | ​ | ​ | ​ | ​ | ​ | ​ |  | 700,308 | ​ | ​ | ​ | ​ | ​ | ​
Other Noninterest Bearing Liabilities | ​ | ​ | 64,878 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 67,405 | ​ | ​ | ​ | ​ | ​ | ​
Total Noninterest Bearing Liabilities | ​ |  | 844,775 | ​ | ​ | ​ | ​ | ​ | ​ |  | 767,713 | ​ | ​ | ​ | ​ | ​ | ​
Shareholders' Equity | ​ | ​ | 474,278 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 435,664 | ​ | ​ | ​ | ​ | ​ | ​
Total Liabilities and Shareholders' Equity | ​ | $ | 5,205,747 | ​ | ​ | ​ | ​ | ​ | ​ | $ | 4,647,925 | ​ | ​ | ​ | ​ | ​ | ​
Net Interest Income / Interest Rate Spread | ​ | ​ | ​ | ​ |  | 97,849 | ​ | 1.69 | % | ​ | ​ | ​ |  | 76,185 | ​ | 1.23 | %
Net Interest Margin (3) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 2.59 | % | ​ | ​ | ​ | ​ | ​ | ​ | 2.24 | %
Taxable Equivalent Adjustment: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Tax-Exempt Investment Securities and Loans | ​ | ​ | ​ | ​ |  | (1,098) | ​ | ​ | ​ | ​ | ​ | ​ |  | (959) | ​ | ​ | ​
Net Interest Income | ​ | ​ | ​ | ​ | $ | 96,751 | ​ | ​ | ​ | ​ | ​ | ​ | $ | 75,226 | ​ | ​ | ​

(1) | Interest income and average rates for tax-exempt investment securities and loans are presented on a tax-equivalent basis, assuming a federal income tax rate of 21%.

(2) | Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.

(3) | Net interest margin includes the tax equivalent adjustment and represents the annualized results of: (i) the difference between interest income on interest earning assets and the interest expense on interest bearing liabilities, divided by (ii) average interest earning assets for the period.

​

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Interest Rates and Operating Interest Differential

Increases and decreases in interest income and interest expense result from changes in average balances (volume) of interest earning assets and interest bearing liabilities, as well as changes in average interest rates. The following table presents the effect that these factors had on the interest earned on interest earning assets and the interest incurred on interest bearing liabilities. The effect of changes in volume is determined by multiplying the change in volume by the previous period’s average rate. Similarly, the effect of rate changes is calculated by multiplying the change in average rate by the previous period’s volume. The changes not attributable specifically to either volume or rate have been allocated to the changes due to volume. The following tables present the changes in the volume and rate of interest bearing assets and liabilities for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, and for the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended September 30, 2025
​ | ​ | Compared with
​ | ​ | Three Months Ended September 30, 2024
​ | ​ | Change Due To: | ​ | Interest
(dollars in thousands) |  | Volume |  | Rate |  | Variance
Interest Earning Assets: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash Investments | ​ | $ | 1,062 | ​ | $ | (301) | ​ | $ | 761
Investment Securities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Taxable Investment Securities | ​ | ​ | 828 | ​ | ​ | 214 | ​ | ​ | 1,042
Tax-Exempt Investment Securities | ​ | ​ | 721 | ​ | ​ | 45 | ​ | ​ | 766
Total Securities | ​ | ​ | 1,549 | ​ | ​ | 259 | ​ | ​ | 1,808
Loans | ​ | ​ | 6,149 | ​ | ​ | 2,050 | ​ | ​ | 8,199
Federal Home Loan Bank Stock | ​ | ​ | 106 | ​ | ​ | (50) | ​ | ​ | 56
Total Interest Earning Assets | ​ | $ | 8,866 | ​ | $ | 1,958 | ​ | $ | 10,824
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest Bearing Liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest Bearing Transaction Deposits | ​ | $ | 405 | ​ | $ | (1,736) | ​ | $ | (1,331)
Savings and Money Market Deposits | ​ | ​ | 4,906 | ​ | ​ | (1,703) | ​ | ​ | 3,203
Time Deposits | ​ | ​ | (120) | ​ | ​ | (95) | ​ | ​ | (215)
Brokered Deposits | ​ | ​ | (1,435) | ​ | ​ | 206 | ​ | ​ | (1,229)
Total Deposits | ​ | ​ | 3,756 | ​ | ​ | (3,328) | ​ | ​ | 428
Federal Funds Purchased | ​ | ​ | (2) | ​ | ​ | — | ​ | ​ | (2)
Notes Payable | ​ | ​ | (149) | ​ | ​ | (41) | ​ | ​ | (190)
FHLB Advances | ​ | ​ | 697 | ​ | ​ | 294 | ​ | ​ | 991
Subordinated Debentures | ​ | ​ | 508 | ​ | ​ | 379 | ​ | ​ | 887
Total Interest Bearing Liabilities | ​ | ​ | 4,810 | ​ | ​ | (2,696) | ​ | ​ | 2,114
Net Interest Income | ​ | $ | 4,056 | ​ | $ | 4,654 | ​ | $ | 8,710

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​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | Nine Months Ended September 30, 2025
​ | ​ | ​ | Compared with
​ | ​ | ​ | Nine Months Ended September 30, 2024
​ | ​ | ​ | Change Due To: | ​ | ​ | Interest
(dollars in thousands) |  | ​ | Volume |  | ​ | Rate |  | ​ | Variance
Interest Earning Assets: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cash Investments | ​ | $ | 3,244 | ​ | $ | (497) | ​ | $ | 2,747
Investment Securities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Taxable Investment Securities | ​ | ​ | 3,472 | ​ | ​ | 25 | ​ | ​ | 3,497
Tax-Exempt Investment Securities | ​ | ​ | 745 | ​ | ​ | 82 | ​ | ​ | 827
Total Securities | ​ | ​ | 4,217 | ​ | ​ | 107 | ​ | ​ | 4,324
Loans | ​ | ​ | 12,427 | ​ | ​ | 6,423 | ​ | ​ | 18,850
Federal Home Loan Bank Stock | ​ | ​ | 163 | ​ | ​ | 20 | ​ | ​ | 183
Total Interest Earning Assets | ​ | $ | 20,051 | ​ | $ | 6,053 | ​ | $ | 26,104
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest Bearing Liabilities: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest Bearing Transaction Deposits | ​ | $ | 2,271 | ​ | $ | (3,608) | ​ | $ | (1,337)
Savings and Money Market Deposits | ​ | ​ | 12,824 | ​ | ​ | (3,234) | ​ | ​ | 9,590
Time Deposits | ​ | ​ | (358) | ​ | ​ | (297) | ​ | ​ | (655)
Brokered Deposits | ​ | ​ | (4,867) | ​ | ​ | 489 | ​ | ​ | (4,378)
Total Deposits | ​ | ​ | 9,870 | ​ | ​ | (6,650) | ​ | ​ | 3,220
Federal Funds Purchased | ​ | ​ | (943) | ​ | ​ | (200) | ​ | ​ | (1,143)
Notes Payable | ​ | ​ | (152) | ​ | ​ | (111) | ​ | ​ | (263)
FHLB Advances | ​ | ​ | 1,563 | ​ | ​ | 53 | ​ | ​ | 1,616
Subordinated Debentures | ​ | ​ | 499 | ​ | ​ | 511 | ​ | ​ | 1,010
Total Interest Bearing Liabilities | ​ | ​ | 10,837 | ​ | ​ | (6,397) | ​ | ​ | 4,440
Net Interest Income | ​ | $ | 9,214 | ​ | $ | 12,450 | ​ | $ | 21,664

​

Comparison of Net Interest Margin, Interest Income, and Interest Expense

Third Quarter of 2025 Compared to Third Quarter of 2024

Net interest income was $34.1 million for the third quarter of 2025, an increase of $8.5 million compared to $25.6 million for the third quarter of 2024. The increase in net interest income was primarily due to growth and higher yields in the loan and securities portfolios and purchase accounting accretion, offset partially by higher deposit balances.

Net interest margin (on a fully tax-equivalent basis) for the third quarter of 2025 was 2.63%, a 39 basis point increase from 2.24% in the third quarter of 2024. Core net interest margin (on a fully tax-equivalent basis), a non-GAAP financial measure which excludes the impact of loan fees and purchase accounting accretion, was 2.52% for the third quarter of 2025, a 36 basis point increase from 2.16% in the third quarter of 2024. The increase in the margin was primarily due to higher earning asset yields and purchase accounting accretion, offset partially by the effects of the subordinated debt refinance completed in the second quarter of 2025.

Average interest earning assets were $5.22 billion for the third quarter of 2025, an increase of $627.6 million, or 13.7%, compared to $4.60 billion for the third quarter of 2024. This increase in average interest earning assets was primarily due to growth in the loan and securities portfolios, higher average cash balances, and the FMCB acquisition. Average interest bearing liabilities were $4.04 billion for the third quarter of 2025, an increase of $544.5 million, or 15.6%, compared to $3.49 billion for the third quarter of 2024. The increase in average interest bearing liabilities was primarily due to deposit growth and deposits acquired, offset partially by a decrease in brokered deposits.

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Average interest earning assets produced a tax-equivalent yield of 5.63% for the third quarter of 2025, compared to 5.48% for the third quarter of 2024. The increase in the yield on interest earning assets was primarily due to growth and repricing of the loan and securities portfolios and purchase accounting accretion attributable to the acquisition of FMCB. The average rate paid on interest bearing liabilities was 3.89% for the third quarter of 2025, compared to 4.27% for the third quarter of 2024. The decrease was primarily due to lower rates paid on deposits.

Interest Income. Total interest income, on a tax-equivalent basis, was $74.2 million for the third quarter of 2025, compared to $63.3 million for the third quarter of 2024. The $10.8 million, or 17.1%, increase in total interest income on a tax-equivalent basis was primarily due to growth of the loan and securities portfolios and higher earning asset yields.

Interest income on the investment securities portfolio, on a tax-equivalent basis, increased $1.8 million for the third quarter of 2025, compared to the third quarter of 2024, primarily due to a $112.7 million, or 16.1%, increase in average balances between the two periods primarily attributable to purchases of investment securities, offset partially by securities sales.

Interest income on loans, on a tax-equivalent basis, was $60.3 million for the third quarter of 2025, compared to $52.1 million for the third quarter of 2024. The $8.2 million, or 15.7%, increase was primarily due to growth and repricing of the loan portfolio in the higher interest rate environment.

The aggregate loan yield increased to 5.79% in the third quarter of 2025, which was 22 basis points higher than 5.57% in the third quarter of 2024. Core loan yield, a non-GAAP financial measure, continued to rise as new loans originated at higher yields and the existing portfolio repriced in the higher interest rate environment.

​

The following table presents a summary of interest, fees and accretion recognized on loans for the periods indicated:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​
​ | ​ | September 30, 2025 | ​ | June 30, 2025 | ​ | March 31, 2025 | ​ | December 31, 2024 | ​ | September 30, 2024 | ​
Interest | ​ | 5.66 | % | 5.59 | % | 5.50 | % | 5.47 | % | 5.47 | %
Fees | ​ | 0.09 | ​ | 0.11 | ​ | 0.07 | ​ | 0.08 | ​ | 0.10 | ​
Accretion | ​ | 0.04 | ​ | 0.04 | ​ | 0.04 | ​ | — | ​ | — | ​
Yield on Loans | ​ | 5.79 | % | 5.74 | % | 5.61 | % | 5.55 | % | 5.57 | %

​

Interest Expense. Interest expense on interest bearing liabilities was $39.5 million for the third quarter of 2025, an increase of $2.1 million, from $37.4 million for the third quarter of 2024. The increase was primarily due to growth of the deposit portfolio, increased utilization of FHLB advances, and higher balance and rate of subordinated debentures following the payoff of $50.0 million of outstanding subordinated notes and the issuance of $80.0 million of new subordinated notes at the end of the second quarter, offset partially by a decrease in rates paid on deposits.

Interest expense on deposits was $34.6 million for the third quarter of 2025, an increase of $428,000, from $34.2 million for the third quarter of 2024. The increase in interest expense on deposits was primarily due to higher balances in savings and money market deposits and interest bearing transaction deposits, offset partially by a decrease in rates paid on those deposit account types. The cost of total deposits was 3.19% in the third quarter of 2025, a 39 basis point decrease, compared to 3.58% in the third quarter of 2024. The decrease was primarily due to lower rates paid on deposits following interest rate cuts in 2024 and 2025 and decreases in average brokered deposit balances.

Interest expense on borrowings was $4.9 million for the third quarter of 2025, an increase of $1.7 million, compared to $3.2 million for the third quarter of 2024. The increase was primarily due to an increased utilization of FHLB advances and higher balance and rate of subordinated debentures due to the previously-discussed subordinated debt refinance in the second quarter of 2025.

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Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

Net interest income was $96.8 million for the nine months ended September 30, 2025, an increase of $21.5 million, or 28.6%, compared to $75.2 million for the nine months ended September 30, 2024. The increase in net interest income was primarily due to growth and higher yields in the loan and securities portfolios, offset partially by higher interest bearing liability balances.

Net interest margin (on a fully tax-equivalent basis) for the nine months ended September 30, 2025 was 2.59%, a 35 basis point increase from 2.24% for the nine months ended September 30, 2024. Core net interest margin (on a fully tax equivalent basis), a non-GAAP financial measure which excludes the impact of loan fees and purchase accounting accretion, was 2.46% for the nine months ended September 30, 2025, a 29 basis point increase from 2.17% for the nine months ended September 30, 2024.

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Average interest earning assets were $5.06 billion for the nine months ended September 30, 2025, an increase of $515.4 million, or 11.3%, compared to $4.54 billion for the nine months ended September 30, 2024. This increase in average interest earning assets was primarily due to higher average cash balances, growth in the loan and securities portfolios, and the FMCB acquisition. Average interest bearing liabilities were $3.89 billion for the nine months ended September 30, 2025, an increase of $442.1 million, or 12.8%, compared to $3.44 billion for nine months ended September 30, 2024. The increase in average interest bearing liabilities was primarily due to an increase in savings and money market deposits and interest bearing transaction deposits, offset partially by a decrease in brokered deposits.

​

Average interest earning assets produced a tax-equivalent yield of 5.54% for the nine months ended September 30, 2025, compared to 5.39% for the nine months ended September 30, 2024. The average rate paid on interest bearing liabilities was 3.85% for the nine months ended September 30, 2025, compared to 4.16% for the nine months ended September 30, 2024.

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Interest Income. Total interest income on a tax-equivalent basis was $209.6 million for the nine months ended September 30, 2025, compared to $183.5 million for the nine months ended September 30, 2024. The $26.1 million increase in total interest income on a tax-equivalent basis was primarily due to growth in the loan and securities portfolios and higher earning asset yields.

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Interest income on the investment securities portfolio, on a tax-equivalent basis, was $29.4 million for the nine months ended September 30, 2025, compared to $25.1 million for the nine months ended September 30, 2024. The $4.3 million increase in total interest income on the investment securities portfolio was primarily due to a $113.5 million, or 16.7%, increase in average balances between the two periods primarily attributable to purchases of investment securities.

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Interest income on loans, on a tax-equivalent basis, for the nine months ended September 30, 2025 was $172.4 million, compared to $153.6 million for the nine months ended September 30, 2024. The $18.9 million increase was primarily due to growth and repricing of the loan portfolio in the higher interest rate environment.

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Interest Expense. Interest expense on interest bearing liabilities was $111.8 million for the nine months ended September 30, 2025, compared to $107.3 million for the nine months ended September 30, 2024. The $4.4 million increase was primarily due to growth of the deposit portfolio.

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Interest expense on deposits increased to $99.2 million for the nine months ended September 30, 2025, compared to $96.0 million for the nine months ended September 30, 2024. The $3.2 million increase in interest expense on deposits was primarily due to higher balances in savings and money market deposits and interest bearing transaction deposits, offset partially by a decrease in brokered deposits and lower rates paid on deposits.

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Interest expense on borrowings was $12.6 million for the nine months ended September 30, 2025, compared to $11.4 million for the nine months ended September 30, 2024. This $1.2 million increase was primarily due to higher average balances of FHLB advances and subordinated debentures, offset partially by lower average balances of federal funds purchased.

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Provision for Credit Losses

The provision for credit losses on loans and leases was $900,000 for the third quarter of 2025, compared to $-0- for the third quarter of 2024. The provision for credit losses on loans and leases was $4.4 million for the nine months ended September 30, 2025, compared to $1.5 million for the nine months ended September 30, 2024. The provision for credit losses on loans and leases recorded in the third quarter of 2025 was primarily attributable to growth in the loan portfolio and an increase in specific reserves for loans individually evaluated. The allowance for credit losses on loans and leases to total loans was 1.34% at September 30, 2025, compared to 1.38% at September 30, 2024.

The following table presents a summary of the activity in the allowance for credit losses on loans and leases for the periods indicated:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
(dollars in thousands) | ​ | 2025 |  | 2024 | ​ | 2025 |  | 2024
Balance at Beginning of Period | ​ | $ | 55,765 | ​ | $ | 51,949 | ​ | $ | 52,277 | ​ | $ | 50,494
Provision for Credit Losses | ​ | ​ | 900 | ​ | ​ | — | ​ | ​ | 4,400 | ​ | ​ | 1,450
Charge-offs | ​ | ​ | (276) | ​ | ​ | (937) | ​ | ​ | (294) | ​ | ​ | (949)
Recoveries | ​ | ​ | 1 | ​ | ​ | 6 | ​ | ​ | 7 | ​ | ​ | 23
Balance at End of Period | ​ | $ | 56,390 | ​ | $ | 51,018 | ​ | $ | 56,390 | ​ | $ | 51,018

​

The provision for credit losses for off-balance sheet credit exposures was $200,000 for the third quarter of 2025, compared to $-0- for the third quarter of 2024. The provision recorded during the third quarter of 2025 was primarily due to an increase in the volume of newly originated loans with unfunded commitments in the commercial and construction and land development segments. The provision for credit losses for off-balance sheet credit exposures was $200,000 for the nine months ended September 30, 2025, compared to a negative provision of $100,000 for the nine months ended September 30, 2024. The allowance for credit losses on off-balance sheet credit exposures was $3.8 million as of September 30, 2025, compared to $2.9 million as of September 30, 2024.

The following table presents a summary of the activity in the provision for credit losses for the periods indicated:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | ​ | ​ | ​ | Nine Months Ended | ​ | ​ | ​
​ | ​ | September 30, | ​ | Increase/ | ​ | September 30, | ​ | Increase/
(dollars in thousands) | ​ | 2025 |  | 2024 |  | (Decrease) | ​ | 2025 |  | 2024 |  | (Decrease)
Provision for Credit Losses on Loans and Leases | ​ | $ | 900 | ​ | $ | — | ​ | $ | 900 | ​ | $ | 4,400 | ​ | $ | 1,450 | ​ | $ | 2,950
Provision for (Recovery of) Credit Losses for Off-Balance Sheet Credit Exposures | ​ | ​ | 200 | ​ | ​ | — | ​ | ​ | 200 | ​ | ​ | 200 | ​ | ​ | (100) | ​ | ​ | 300
Provision for Credit Losses | ​ | $ | 1,100 | ​ | $ | — | ​ | $ | 1,100 | ​ | $ | 4,600 | ​ | $ | 1,350 | ​ | $ | 3,250

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Noninterest Income

Noninterest income was $2.1 million for the third quarter of 2025, an increase of $539,000 from $1.5 million for the third quarter of 2024. The increase was primarily due to higher investment advisory fees and customer service fees. Noninterest income was $7.8 million for the nine months ended September 30, 2025, an increase of $2.9 million from $4.8 million for the nine months ended September 30, 2024. The increase was primarily due to higher swap fees, investment advisory fees, and customer service fees.

The following table presents the major components of noninterest income for the periods indicated:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | ​ | ​ | ​ | Nine Months Ended | ​ | ​ | ​
​ | ​ | September 30, | ​ | Increase/ | ​ | September 30, | ​ | Increase/
(dollars in thousands) | ​ | 2025 |  | 2024 |  | (Decrease) |  | 2025 |  | 2024 |  | (Decrease)
Noninterest Income: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Customer Service Fees | ​ | $ | 501 | ​ | $ | 373 | ​ | $ | 128 | ​ | $ | 1,492 | ​ | $ | 1,081 | ​ | $ | 411
Net Gain (Loss) on Sales of Securities | ​ | ​ | 59 | ​ | ​ | (28) | ​ | ​ | 87 | ​ | ​ | 534 | ​ | ​ | 385 | ​ | ​ | 149
Letter of Credit Fees | ​ | ​ | 383 | ​ | ​ | 424 | ​ | ​ | (41) | ​ | ​ | 1,161 | ​ | ​ | 1,127 | ​ | ​ | 34
Debit Card Interchange Fees | ​ | ​ | 173 | ​ | ​ | 152 | ​ | ​ | 21 | ​ | ​ | 462 | ​ | ​ | 448 | ​ | ​ | 14
Swap Fees | ​ | ​ | — | ​ | ​ | 26 | ​ | ​ | (26) | ​ | ​ | 980 | ​ | ​ | 26 | ​ | ​ | 954
Bank-Owned Life Insurance | ​ | ​ | 440 | ​ | ​ | 352 | ​ | ​ | 88 | ​ | ​ | 1,206 | ​ | ​ | 965 | ​ | ​ | 241
Investment Advisory Fees | ​ | ​ | 208 | ​ | ​ | — | ​ | ​ | 208 | ​ | ​ | 746 | ​ | ​ | — | ​ | ​ | 746
FHLB Prepayment Income | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 301 | ​ | ​ | — | ​ | ​ | 301
Other Income | ​ | ​ | 297 | ​ | ​ | 223 | ​ | ​ | 74 | ​ | ​ | 885 | ​ | ​ | 803 | ​ | ​ | 82
Totals | ​ | $ | 2,061 | ​ | $ | 1,522 | ​ | $ | 539 | ​ | $ | 7,767 | ​ | $ | 4,835 | ​ | $ | 2,932

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Noninterest Expense

Third Quarter of 2025 Compared to Third Quarter of 2024

Noninterest expense was $20.0 million for the third quarter of 2025, an increase of $4.2 million from $15.8 million for the third quarter of 2024. The increase was primarily attributable to increases in salaries and employee benefits, marketing and advertising, operating costs related to the FMCB acquisition, and merger-related expenses.

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

Noninterest expense was $57.0 million for the nine months ended September 30, 2025, an increase of $10.5 million, from $46.5 million for the nine months ended September 30, 2024. The increase was primarily attributable to increases in salaries and employee benefits, increased operating costs related to the FMCB acquisition, and merger-related expenses.

The Company had 325 full-time equivalent employees at September 30, 2025, compared to 308 at June 30, 2025, and 265 at September 30, 2024. The year-over-year increase was largely driven by the addition of employees from the acquisition of FMCB and the hiring of key talent across the organization.

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Efficiency Ratio. The efficiency ratio, a non-GAAP financial measure, reports total noninterest expense, less amortization of intangible assets, as a percentage of net interest income plus total noninterest income, less gains (losses) on sales of securities. Management believes this non-GAAP financial measure provides a meaningful comparison of operational performance and facilitates investors’ assessments of business performance and trends in comparison to peers in the banking industry.

The efficiency ratio was 54.7% for the third quarter of 2025, compared to 58.0% for the third quarter of 2024. The efficiency ratio was 54.2% and 58.3%, respectively for the nine months ended September 30, 2025 and

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September 30, 2024. The Company’s efficiency has remained consistently below the industry median due in part to its “branch-light” model.

The following table presents the major components of noninterest expense for the periods indicated:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | ​ | ​ | ​ | Nine Months Ended | ​ | ​ | ​
​ | ​ | September 30, | ​ | Increase/ | ​ | September 30, | ​ | Increase/
(dollars in thousands) | ​ | 2025 |  | 2024 |  | (Decrease) |  | 2025 |  | 2024 |  | (Decrease)
Noninterest Expense: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Salaries and Employee Benefits | ​ | $ | 12,229 | ​ | $ | 9,851 | ​ | $ | 2,378 | ​ | $ | 34,963 | ​ | $ | 28,959 | ​ | $ | 6,004
Occupancy and Equipment | ​ | ​ | 1,266 | ​ | ​ | 1,069 | ​ | ​ | 197 | ​ | ​ | 3,774 | ​ | ​ | 3,218 | ​ | ​ | 556
FDIC Insurance Assessment | ​ | ​ | 775 | ​ | ​ | 750 | ​ | ​ | 25 | ​ | ​ | 1,975 | ​ | ​ | 2,350 | ​ | ​ | (375)
Data Processing | ​ | ​ | 637 | ​ | ​ | 368 | ​ | ​ | 269 | ​ | ​ | 1,881 | ​ | ​ | 1,252 | ​ | ​ | 629
Professional and Consulting Fees | ​ | ​ | 1,261 | ​ | ​ | 1,149 | ​ | ​ | 112 | ​ | ​ | 3,365 | ​ | ​ | 2,890 | ​ | ​ | 475
Derivative Collateral Fees | ​ | ​ | 309 | ​ | ​ | 381 | ​ | ​ | (72) | ​ | ​ | 1,132 | ​ | ​ | 1,395 | ​ | ​ | (263)
Information Technology and Telecommunications | ​ | ​ | 973 | ​ | ​ | 840 | ​ | ​ | 133 | ​ | ​ | 2,915 | ​ | ​ | 2,448 | ​ | ​ | 467
Marketing and Advertising | ​ | ​ | 658 | ​ | ​ | 367 | ​ | ​ | 291 | ​ | ​ | 1,420 | ​ | ​ | 1,006 | ​ | ​ | 414
Intangible Asset Amortization | ​ | ​ | 230 | ​ | ​ | 9 | ​ | ​ | 221 | ​ | ​ | 690 | ​ | ​ | 26 | ​ | ​ | 664
Other Expense | ​ | ​ | 1,618 | ​ | ​ | 976 | ​ | ​ | 642 | ​ | ​ | 4,918 | ​ | ​ | 2,944 | ​ | ​ | 1,974
Totals | ​ | $ | 19,956 | ​ | $ | 15,760 | ​ | $ | 4,196 | ​ | $ | 57,033 | ​ | $ | 46,488 | ​ | $ | 10,545

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Income Tax Expense

The provision for income taxes includes both federal and state taxes. Fluctuations in effective tax rates reflect the differences in the inclusion or deductibility of certain income and expenses for income tax purposes and the recognition of tax credits. The Company’s future effective income tax rate will fluctuate based on the mix of taxable and tax-free investments and loans, the recognition and availability of tax credit investments, and overall taxable income.

Income tax expense was $3.5 million for the third quarter of 2025, compared to $2.7 million for the third quarter of 2024. The effective combined federal and state income tax rate for the third quarter of 2025 was 23.2%, compared to 23.6% for the third quarter of 2024. Income tax expense was $10.1 million for the nine months ended September 30, 2025, compared to $7.6 million for the nine months ended September 30, 2024. The effective combined federal and state income tax rate for both the nine months ended September 30, 2025 and 2024 was 23.6%.

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Financial Condition

Assets

Total assets at September 30, 2025 were $5.36 billion, an increase of $293.8 million, or 5.8%, over total assets of $5.07 billion at December 31, 2024, and an increase of $668.5 million, or 14.2%, over total assets of $4.69 billion at September 30, 2024. The year-to-date increase was primarily due to organic growth in the loan portfolio. The year-over-year increase was primarily due to growth in the loan and securities portfolios driven by organic growth and the acquisition of FMCB in the fourth quarter of 2024.

Investment Securities Portfolio

The investment securities portfolio is used to make various term investments and is intended to provide the Company with adequate liquidity, a source of stable income, and at times, serve as collateral for certain types of deposits or borrowings. Investment balances in the investment securities portfolio are subject to change over time based on funding needs and interest rate risk management objectives. The liquidity levels take into account anticipated

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future cash flows and are maintained at levels management believes are appropriate to ensure future flexibility in meeting anticipated funding needs.

The investment securities portfolio consists primarily of U.S. treasury securities, U.S. government agency mortgage backed securities, municipal securities, corporate securities comprised primarily of subordinated debentures of banks and financial holding companies, and asset-backed securities. In addition, the Company also holds other mortgage backed and other debt securities, all with varying contractual maturities. These maturities do not necessarily represent the expected life of the securities as the securities may be called or paid down without penalty prior to their stated maturities. All investment securities are held as available for sale.

Securities available for sale were $826.5 million at September 30, 2025, an increase of $58.2 million, or 7.6%, compared to $768.2 million at December 31, 2024. The increase was primarily due to purchases of investment securities and improvements in the overall securities market.

The following table presents the amortized cost and fair value of securities available for sale, by type, at September 30, 2025 and December 31, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | September 30, 2025 | ​ | ​ | December 31, 2024 | ​
​ | ​ | Amortized | ​ | Fair | ​ | ​ | ​ | ​ | Amortized | ​ | Fair |  | ​ | ​
(dollars in thousands) |  | Cost |  | Value |  | Percent | ​ | ​ | Cost |  | Value |  | Percent | ​
U.S. Treasury Securities | ​ | $ | 155,902 | ​ | $ | 147,199 | ​ | 17.8 | % | ​ | $ | 179,835 | ​ | $ | 167,748 | ​ | 21.8 | %
U.S Government Agency Securities | ​ | ​ | 9,803 | ​ | ​ | 9,835 | ​ | 1.2 | ​ | ​ | ​ | 22,053 | ​ | ​ | 22,082 | ​ | 2.9 | ​
Mortgage-Backed Securities Issued or Guaranteed by U.S. Agencies (MBS): | ​ |  | ​ | ​ |  | ​ | ​ | ​ | ​ | ​ |  | ​ | ​ |  | ​ | ​ | ​ | ​
Residential Pass-Through: | ​ |  | ​ | ​ |  | ​ | ​ | ​ | ​ | ​ |  | ​ | ​ |  | ​ | ​ | ​ | ​
Guaranteed by GNMA | ​ |  | 45,040 | ​ |  | 44,773 | ​ | 5.4 | ​ | ​ |  | 7,726 | ​ |  | 7,021 | ​ | 0.8 | ​
Issued by FNMA and FHLMC | ​ |  | 27,949 | ​ |  | 25,991 | ​ | 3.1 | ​ | ​ |  | 60,532 | ​ |  | 57,354 | ​ | 7.5 | ​
Other Residential Mortgage-Backed Securities | ​ |  | 75,620 | ​ |  | 68,830 | ​ | 8.3 | ​ | ​ |  | 71,301 | ​ |  | 61,969 | ​ | 8.1 | ​
Commercial Mortgage-Backed Securities | ​ |  | 7,592 | ​ |  | 7,388 | ​ | 0.9 | ​ | ​ |  | 11,084 | ​ |  | 10,583 | ​ | 1.4 | ​
All Other Commercial MBS | ​ |  | 110,970 | ​ |  | 112,167 | ​ | 13.6 | ​ | ​ |  | 109,190 | ​ |  | 107,963 | ​ | 14.1 | ​
Total MBS | ​ |  | 267,171 | ​ |  | 259,149 | ​ | 31.3 | ​ | ​ |  | 259,833 | ​ |  | 244,890 | ​ | 31.9 | ​
Municipal Securities | ​ |  | 247,471 | ​ | ​ | 240,547 | ​ | 29.1 | ​ | ​ | ​ | 139,891 | ​ | ​ | 122,265 | ​ | 15.9 | ​
Corporate Securities | ​ |  | 109,613 | ​ | ​ | 107,983 | ​ | 13.1 | ​ | ​ | ​ | 139,161 | ​ | ​ | 134,186 | ​ | 17.5 | ​
Asset-Backed Securities | ​ | ​ | 61,687 | ​ | ​ | 61,760 | ​ | 7.5 | ​ | ​ | ​ | 76,891 | ​ | ​ | 77,076 | ​ | 10.0 | ​
Total | ​ | $ | 851,647 | ​ | $ | 826,473 | ​ | 100.0 | % | ​ | $ | 817,664 | ​ | $ | 768,247 | ​ | 100.0 | %

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Loan Portfolio

The Company focuses on lending to borrowers located or investing in the Minneapolis-St. Paul-Bloomington, MN-WI Metropolitan Statistical Area across a diverse range of industries and property types. The Company lends primarily to commercial customers, consisting of loans secured by nonfarm, nonresidential properties, multifamily residential properties, land, and non-real estate business assets. Responsive service, local decision making, and an efficient turnaround time from application to closing have been significant factors in growing the loan portfolio.

The Company manages concentrations of credit exposure through a risk management program which implements formalized processes and procedures specifically for managing and mitigating risk within the loan portfolio. The processes and procedures include board of directors and management oversight, commercial real estate exposure limits, portfolio monitoring tools, management information systems, market reports, underwriting standards, internal and external loan review, and stress testing.

Total gross loans at September 30, 2025 were $4.21 billion, an increase $346.0 million, or 8.9%, over total gross loans of $3.87 billion at December 31, 2024, and an increase of $529.0 million, or 14.4%, over total gross loans of $3.69 billion at September 30, 2024. The year-to-date increase in the loan portfolio was primarily due to increased loan originations and lower loan payoffs. The year-over-year increase was primarily attributable to increased loan originations and the acquisition of FMCB during the fourth quarter of 2024.

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The following table presents the dollar and percentage composition of the loan portfolio by category, at the dates indicated:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025 | ​ | June 30, 2025 | ​ | March 31, 2025 | ​ | December 31, 2024 | ​ | September 30, 2024 |
(dollars in thousands) |  | Amount |  | Percent |  | Amount |  | Percent |  | Amount |  | Percent |  | Amount |  | Percent |  | Amount |  | Percent |
Commercial | ​ | $ | 533,476 | ​ | 12.7 | % | $ | 549,259 | ​ | 13.3 | % | $ | 528,801 | ​ | 13.2 | % | $ | 497,662 | ​ | 12.9 | % | $ | 493,403 | ​ | 13.4 | %
Leases | ​ | ​ | 43,186 | ​ | 1.0 | ​ | ​ | 44,817 | ​ | 1.1 | ​ | ​ | 43,958 | ​ | 1.1 | ​ | ​ | 44,291 | ​ | 1.1 | ​ | ​ | — | ​ | — | ​
Construction and Land Development | ​ | ​ | 159,991 | ​ | 3.8 | ​ | ​ | 136,438 | ​ | 3.3 | ​ | ​ | 128,073 | ​ | 3.2 | ​ | ​ | 97,255 | ​ | 2.5 | ​ | ​ | 118,596 | ​ | 3.2 | ​
1-4 Family Construction | ​ | ​ | 41,739 | ​ | 1.0 | ​ | ​ | 39,095 | ​ | 0.9 | ​ | ​ | 39,438 | ​ | 1.0 | ​ | ​ | 41,961 | ​ | 1.1 | ​ | ​ | 45,822 | ​ | 1.3 | ​
Real Estate Mortgage: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
1-4 Family Mortgage | ​ | ​ | 487,297 | ​ | 11.6 | ​ | ​ | 474,269 | ​ | 11.4 | ​ | ​ | 479,461 | ​ | 11.9 | ​ | ​ | 474,383 | ​ | 12.3 | ​ | ​ | 421,179 | ​ | 11.4 | ​
Multifamily | ​ | ​ | 1,578,223 | ​ | 37.4 | ​ | ​ | 1,555,731 | ​ | 37.5 | ​ | ​ | 1,534,747 | ​ | 38.2 | ​ | ​ | 1,425,610 | ​ | 36.9 | ​ | ​ | 1,379,814 | ​ | 37.4 | ​
CRE Owner Occupied | ​ | ​ | 192,966 | ​ | 4.6 | ​ | ​ | 192,837 | ​ | 4.7 | ​ | ​ | 196,080 | ​ | 4.9 | ​ | ​ | 191,248 | ​ | 4.9 | ​ | ​ | 182,239 | ​ | 5.0 | ​
CRE Nonowner Occupied | ​ | ​ | 1,158,622 | ​ | 27.5 | ​ | ​ | 1,137,007 | ​ | 27.4 | ​ | ​ | 1,055,157 | ​ | 26.1 | ​ | ​ | 1,083,108 | ​ | 28.0 | ​ | ​ | 1,032,142 | ​ | 28.0 | ​
Total Real Estate Mortgage Loans | ​ |  | 3,417,108 | ​ | 81.1 | ​ |  | 3,359,844 | ​ | 81.0 | ​ |  | 3,265,445 | ​ | 81.1 | ​ |  | 3,174,349 | ​ | 82.1 | ​ |  | 3,015,374 | ​ | 81.8 | ​
Consumer and Other | ​ | ​ | 19,054 | ​ | 0.4 | ​ | ​ | 16,346 | ​ | 0.4 | ​ | ​ | 14,361 | ​ | 0.4 | ​ | ​ | 12,996 | ​ | 0.3 | ​ | ​ | 12,395 | ​ | 0.3 | ​
Total Loans, Gross | ​ |  | 4,214,554 | ​ | 100.0 | % |  | 4,145,799 | ​ | 100.0 | % |  | 4,020,076 | ​ | 100.0 | % |  | 3,868,514 | ​ | 100.0 | % |  | 3,685,590 | ​ | 100.0 | %
Allowance for Credit Losses | ​ | ​ | (56,390) | ​ | ​ | ​ | ​ | (55,765) | ​ | ​ | ​ | ​ | (53,766) | ​ | ​ | ​ | ​ | (52,277) | ​ | ​ | ​ | ​ | (51,018) | ​ | ​ | ​
Net Deferred Loan Fees | ​ | ​ | (8,282) | ​ | ​ | ​ | ​ | (7,629) | ​ | ​ | ​ | ​ | (7,218) | ​ | ​ | ​ | ​ | (6,801) | ​ | ​ | ​ | ​ | (5,705) | ​ | ​ | ​
Total Loans, Net | ​ | $ | 4,149,882 | ​ | ​ | ​ | $ | 4,082,405 | ​ | ​ | ​ | $ | 3,959,092 | ​ | ​ | ​ | $ | 3,809,436 | ​ | ​ | ​ | $ | 3,628,867 | ​ | ​ | ​

​

The Company primarily focuses on real estate mortgage lending, which constituted 81.1% of the portfolio at September 30, 2025. The composition of the portfolio has remained relatively consistent with prior periods, and the Company does not expect any significant changes in the composition of the loan portfolio or the emphasis on real estate lending in the foreseeable future.

​

As of September 30, 2025, investor CRE loans totaled $2.94 billion, consisting of $1.16 billion of loans secured by nonowner occupied CRE, $1.58 billion of loans secured by multifamily residential properties, $41.7 million of 1-4 family construction loans, and $160.0 million of construction and land development loans. Investor CRE loans represented 69.7% of the total gross loan portfolio and 474.7% of the Bank’s total risk-based capital at September 30, 2025, compared to 68.4% and 462.0%, respectively, at December 31, 2024.

The following table provides a breakdown of CRE nonowner occupied loans by collateral types as of September 30, 2025 and December 31, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025 | ​ | ​ | December 31, 2024 | ​
​ | ​ | ​ | ​ | ​ | Percent of | ​ | Percent of | ​ | ​ | ​ | ​ | ​ | Percent of | ​ | Percent of | ​
​ | ​ | ​ | ​ | ​ | CRE Nonowner | ​ | Total Loan | ​ | ​ | ​ | ​ | ​ | CRE Nonowner | ​ | Total Loan | ​
(dollars in thousands) | ​ | Balance | ​ | Occupied Portfolio | ​ | Portfolio | ​ | ​ | Balance | ​ | Occupied Portfolio | ​ | Portfolio | ​
Collateral Type: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Industrial | ​ | $ | 310,417 | ​ | 26.8 | % | 7.4 | % | ​ | $ | 285,594 | ​ | 26.4 | % | 7.4 | %
Office | ​ | ​ | 210,908 | ​ | 18.2 | ​ | 5.0 | ​ | ​ | ​ | 191,638 | ​ | 17.7 | ​ | 5.0 | ​
Retail | ​ | ​ | 189,452 | ​ | 16.4 | ​ | 4.5 | ​ | ​ | ​ | 172,530 | ​ | 15.9 | ​ | 4.5 | ​
Nursing/Assisted Living | ​ | ​ | 119,633 | ​ | 10.3 | ​ | 2.8 | ​ | ​ | ​ | 108,452 | ​ | 10.3 | ​ | 2.9 | ​
Mini Storage Facility | ​ | ​ | 109,548 | ​ | 9.5 | ​ | 2.6 | ​ | ​ | ​ | 111,705 | ​ | 10.2 | ​ | 2.9 | ​
Medical Office | ​ | ​ | 90,549 | ​ | 7.8 | ​ | 2.1 | ​ | ​ | ​ | 110,486 | ​ | 10.0 | ​ | 2.8 | ​
Other | ​ | ​ | 128,115 | ​ | 11.0 | ​ | 3.1 | ​ | ​ | ​ | 102,703 | ​ | 9.5 | ​ | 2.5 | ​
Total CRE Nonowner Occupied | ​ | $ | 1,158,622 | ​ | 100.0 | % | 27.5 | % | ​ | $ | 1,083,108 | ​ | 100.0 | % | 28.0 | %

​

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The following tables present time to contractual maturity and sensitivity to interest rate changes for the loan portfolio as of September 30, 2025 and December 31, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | As of September 30, 2025
​ |  | Due in One Year |  | More Than One |  | More Than Five | ​ | After
(dollars in thousands) | ​ | or Less | ​ | Year to Five Years | ​ | Year to Fifteen Years | ​ | Fifteen Years
Commercial | ​ | $ | 227,214 | ​ | $ | 233,343 | ​ | $ | 70,072 | ​ | $ | 2,847
Leases | ​ | ​ | 4,301 | ​ | ​ | 38,545 | ​ | ​ | 340 | ​ | ​ | —
Construction and Land Development | ​ |  | 82,777 | ​ |  | 70,515 | ​ |  | 6,699 | ​ |  | —
1-4 Family Construction | ​ | ​ | 37,324 | ​ | ​ | 4,214 | ​ | ​ | 201 | ​ | ​ | —
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​
1-4 Family Mortgage | ​ |  | 95,296 | ​ |  | 299,725 | ​ |  | 67,256 | ​ |  | 25,020
Multifamily | ​ |  | 228,139 | ​ |  | 822,792 | ​ |  | 443,045 | ​ |  | 84,247
CRE Owner Occupied | ​ |  | 10,645 | ​ |  | 119,673 | ​ |  | 59,090 | ​ |  | 3,558
CRE Nonowner Occupied | ​ |  | 263,268 | ​ |  | 697,651 | ​ |  | 197,277 | ​ |  | 426
Total Real Estate Mortgage Loans | ​ |  | 597,348 | ​ |  | 1,939,841 | ​ |  | 766,668 | ​ |  | 113,251
Consumer and Other | ​ |  | 9,687 | ​ | ​ | 8,913 | ​ | ​ | 161 | ​ | ​ | 293
Total Loans, Gross | ​ | $ | 958,651 | ​ | $ | 2,295,371 | ​ | $ | 844,141 | ​ | $ | 116,391
Interest Rate Sensitivity: | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  | ​
Fixed Interest Rates | ​ | $ | 607,379 | ​ | $ | 1,776,247 | ​ | $ | 419,383 | ​ | $ | 25,313
Floating or Adjustable Rates | ​ |  | 351,272 | ​ |  | 519,124 | ​ |  | 424,758 | ​ |  | 91,078
Total Loans, Gross | ​ | $ | 958,651 | ​ | $ | 2,295,371 | ​ | $ | 844,141 | ​ | $ | 116,391

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | As of December 31, 2024
​ |  | Due in One Year |  | More Than One |  | More Than Five | ​ | After
(dollars in thousands) | ​ | or Less | ​ | Year to Five Years | ​ | Year to Fifteen Years | ​ | Fifteen Years
Commercial | ​ | $ | 170,588 | ​ | $ | 248,695 | ​ | $ | 75,467 | ​ | $ | 2,912
Leases | ​ | ​ | 4,998 | ​ | ​ | 38,641 | ​ | ​ | 652 | ​ | ​ | —
Construction and Land Development | ​ |  | 53,373 | ​ |  | 42,002 | ​ |  | 1,880 | ​ |  | —
1-4 Family Construction | ​ | ​ | 38,996 | ​ | ​ | 2,764 | ​ | ​ | 201 | ​ | ​ | —
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​
1-4 Family Mortgage | ​ |  | 74,914 | ​ |  | 297,516 | ​ |  | 76,647 | ​ |  | 25,306
Multifamily | ​ |  | 206,913 | ​ |  | 637,012 | ​ |  | 513,194 | ​ |  | 68,491
CRE Owner Occupied | ​ |  | 4,704 | ​ |  | 112,223 | ​ |  | 69,742 | ​ |  | 4,579
CRE Nonowner Occupied | ​ |  | 264,947 | ​ |  | 602,380 | ​ |  | 214,971 | ​ |  | 810
Total Real Estate Mortgage Loans | ​ |  | 551,478 | ​ |  | 1,649,131 | ​ |  | 874,554 | ​ |  | 99,186
Consumer and Other | ​ |  | 8,813 | ​ | ​ | 3,776 | ​ | ​ | 174 | ​ | ​ | 233
Total Loans, Gross | ​ | $ | 828,246 | ​ | $ | 1,985,009 | ​ | $ | 952,928 | ​ | $ | 102,331
Interest Rate Sensitivity: | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  | ​
Fixed Interest Rates | ​ | $ | 580,854 | ​ | $ | 1,622,161 | ​ | $ | 475,264 | ​ | $ | 32,271
Floating or Adjustable Rates | ​ |  | 247,392 | ​ |  | 362,848 | ​ |  | 477,664 | ​ |  | 70,060
Total Loans, Gross | ​ | $ | 828,246 | ​ | $ | 1,985,009 | ​ | $ | 952,928 | ​ | $ | 102,331

​

Asset Quality

The Company emphasizes credit quality in the originating and monitoring of the loan portfolio, and success in underwriting is measured by the levels of classified and nonperforming assets and net charge-offs. Federal regulations and internal policies require the use of an asset classification system as a means of managing and reporting problem and potential problem assets. The Company has incorporated an internal asset classification system, substantially consistent with federal banking regulations, as a part of the credit monitoring system. Federal banking regulations set forth a classification scheme for problem and potential problem assets as “special mention,” “substandard,” “doubtful” or “loss” assets. An asset identified as “special mention” is not adversely classified but has potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in the deterioration of the payment prospects of the asset. An asset is considered “substandard” if it is inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. A financial institution with assets classified as “special mention” is not expected to sustain losses of principal or interest from these assets and should not classify assets under this category for more than a year. “Substandard” assets include those characterized by the “distinct possibility” that the financial institution will sustain “some loss” if the deficiencies are not corrected.

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Assets classified as “doubtful” have all of the weaknesses inherent in those classified “substandard” with the added characteristic that the weaknesses present make “collection or liquidation in full,” on the basis of currently existing facts, conditions, and values, “highly questionable and improbable.” Assets classified as “loss” are those considered “uncollectible” and of such little value that their continuance as assets without the establishment of a specific loss reserve is not warranted. Assets which do not currently expose the insured institution to sufficient risk to warrant classification in one of the aforementioned categories but possess weaknesses are required to be designated “watch.”

​

The following table presents information on loan classifications at September 30, 2025. The Company had no assets classified as doubtful or loss at September 30, 2025.

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Risk Category |  | ​
(dollars in thousands) | ​ | Watch/Special Mention | ​ | Substandard | ​ | Total
Commercial | ​ | $ | 1,431 | ​ | $ | 14,137 | ​ | $ | 15,568
Leases | ​ | ​ | — | ​ | ​ | 19 | ​ | ​ | 19
Construction and Land Development |  | ​ | — |  | ​ | 40 |  | ​ | 40
Real Estate Mortgage: |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
1-4 Family Mortgage |  | ​ | — |  | ​ | 1,143 |  | ​ | 1,143
Multifamily |  | ​ | 34,054 |  | ​ | 23,856 |  | ​ | 57,910
CRE Owner Occupied |  | ​ | 5,022 |  | ​ | 2,692 |  | ​ | 7,714
CRE Nonowner Occupied |  | ​ | 135 |  | ​ | 16,187 |  | ​ | 16,322
Total Real Estate Mortgage Loans |  | ​ | 39,211 |  | ​ | 43,878 |  | ​ | 83,089
Totals | ​ | $ | 40,642 | ​ | $ | 58,074 | ​ | $ | 98,716

​

Loans that have potential weaknesses that warranted a watch or special mention risk rating at September 30, 2025 totaled $40.6 million, compared to $46.6 million at December 31, 2024. Loans that warranted a substandard risk rating at September 30, 2025 totaled $58.1 million, compared to $21.8 million at December 31, 2024. Management continues to actively work with these borrowers and closely monitor substandard credits.

Nonperforming Assets

Nonperforming loans include loans accounted for on a nonaccrual basis and loans 90 days past due and still accruing. Nonaccrual loans totaled $10.0 million as of September 30, 2025 and $301,000 as of December 31, 2024. There were no loans 90 days past due and still accruing as of September 30, 2025 or December 31, 2024. There were also no foreclosed assets as of September 30, 2025 and December 31, 2024.

​

The following table presents a summary of nonperforming assets, by category, at the dates indicated:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, | ​ | December 31, | ​
(dollars in thousands) |  | 2025 |  | 2024 | ​
Total Nonaccrual Loans | ​ | $ | 9,991 | ​ | $ | 301 | ​
Total Nonperforming Loans | ​ | $ | 9,991 | ​ | $ | 301 | ​
Total Nonperforming Assets (1) | ​ | $ | 9,991 | ​ | $ | 301 | ​
Nonaccrual Loans to Total Loans | ​ |  | 0.24 | % |  | 0.01 | %
Nonperforming Loans to Total Loans | ​ |  | 0.24 | ​ |  | 0.01 | ​
Nonperforming Assets to Total Loans Plus Foreclosed Assets (1) | ​ |  | 0.24 | ​ |  | 0.01 | ​

(1) | Nonperforming assets are defined as nonaccrual loans and loans greater than 90 days past due still accruing plus foreclosed assets. There were no loans greater than 90 days past due still accruing or modified accruing loans for any period shown.

​

The balance of nonperforming assets can fluctuate due to changes in economic conditions. The Company has established a policy to discontinue accruing interest on a loan (that is, to place the loan on nonaccrual status) after it

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has become 90 days delinquent as to payment of principal or interest, unless the loan is considered to be well-collateralized and is actively in the process of collection. In addition, a loan will be placed on nonaccrual status before it becomes 90 days delinquent unless management believes that the collection of interest is expected. Interest previously accrued but uncollected on such loans is reversed and charged against current income when the receivable is determined to be uncollectible. If management believes that a loan will not be collected in full, an increase to the allowance for credit losses on loans is recorded to reflect management’s estimate of any potential exposure or loss. Generally, payments received on nonaccrual loans are applied directly to principal. Gross income that would have been recorded on nonaccrual loans for three and nine months ended September 30, 2025 was $56,000 and $398,000, respectively. Gross income that would have been recorded on nonaccrual loans for the three and nine months ended September 30, 2024 was $116,000 and $152,000, respectively.

Allowance for Credit Losses

The allowance for credit losses on loans and leases is a reserve established through charges to earnings in the form of a provision for credit losses. The Company maintains an allowance for credit losses at a level management considers adequate to provide for expected lifetime losses in the portfolio. Although management strives to maintain an allowance it deems adequate, future economic changes, deterioration of borrowers’ creditworthiness, and the impact of examinations by regulatory agencies, among other factors, all could cause changes to the allowance for credit losses on loans and leases.

At September 30, 2025, the allowance for credit losses on loans and leases was $56.4 million, an increase of $4.1 million from $52.3 million at December 31, 2024. Net charge-offs (recoveries) totaled $275,000 during the third quarter of 2025 and $931,000 during the third quarter of 2024. Net charge-offs (recoveries) totaled $287,000 for the nine months ended September 30, 2025, and $926,000 for the nine months ended September 30, 2024. The allowance for credit losses on loans and leases as a percentage of total loans was 1.34% at September 30, 2025 and 1.35% at December 31, 2024.

​

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The following table presents a summary of net charge-offs for the periods indicated:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended | ​
​ | ​ | September 30, | ​ | September 30, | ​
(dollars in thousands) |  | 2025 |  | 2024 | ​ | 2025 |  | 2024 |
Net Charge-offs (Recoveries) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Commercial | ​ | $ | 254 | ​ | $ | (5) | ​ | $ | 253 | ​ | $ | (10) | ​
Leases | ​ | ​ | 15 | ​ | ​ | — | ​ | ​ | 15 | ​ | ​ | — | ​
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​
1-4 Family Mortgage | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | (3) | ​
CRE Nonowner Occupied | ​ |  | — | ​ |  | 935 | ​ |  | — | ​ |  | 935 | ​
Total Real Estate Mortgage Loans | ​ |  | — | ​ |  | 935 | ​ |  | — | ​ |  | 932 | ​
Consumer and Other | ​ |  | 6 | ​ |  | 1 | ​ |  | 19 | ​ | ​ | 4 | ​
Total Net Charge-offs (Recoveries) | ​ | $ | 275 | ​ | $ | 931 | ​ | $ | 287 | ​ | $ | 926 | ​
Net Charge-offs to Average Loans | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​
Commercial | ​ |  | 0.20 | % |  | 0.00 | % |  | 0.07 | % | ​ | 0.00 | %
Leases | ​ | ​ | 0.14 | ​ | ​ | 0.00 | ​ | ​ | 0.05 | ​ | ​ | 0.00 | ​
Real Estate Mortgage: | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ | ​ | ​ | ​
CRE Nonowner Occupied | ​ |  | 0.00 | ​ |  | 0.35 | ​ |  | 0.00 | ​ | ​ | 0.12 | ​
Total Real Estate Mortgage Loans | ​ |  | 0.00 | ​ |  | 0.12 | ​ |  | 0.00 | ​ | ​ | 0.04 | ​
Consumer and Other | ​ |  | 0.13 | ​ |  | 0.04 | ​ |  | 0.16 | ​ | ​ | 0.05 | ​
Total Net Charge-offs (Recoveries) (Annualized) to Average Loans | ​ |  | 0.03 | % |  | 0.10 | % |  | 0.01 | % |  | 0.03 | %
Gross Loans, End of Period | ​ | $ | 4,214,554 | ​ | $ | 3,685,590 | ​ | $ | 4,214,554 | ​ | $ | 3,685,590 | ​
Average Loans | ​ | ​ | 4,132,987 | ​ |  | 3,721,654 | ​ | ​ | 4,034,656 | ​ |  | 3,740,855 | ​
Allowance for Credit Losses to Total Gross Loans | ​ |  | 1.34 | % |  | 1.38 | % |  | 1.34 | % |  | 1.38 | %

​

The following table presents a summary of the allocation of the allowance for credit losses on loans and leases by loan portfolio segment as of the dates indicated:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, | ​ | December 31, | ​
​ | ​ | 2025 | ​ | 2024 | ​
(dollars in thousands) |  | Amount |  | Percent |  | Amount |  | Percent | ​
Commercial | ​ | $ | 6,793 | ​ | 12.1 | % | $ | 5,630 | ​ | 10.8 | %
Leases | ​ | ​ | 418 | ​ | 0.7 | ​ | ​ | 368 | ​ | 0.7 | ​
Construction and Land Development | ​ |  | 1,280 | ​ | 2.3 | ​ |  | 866 | ​ | 1.7 | ​
1-4 Family Construction | ​ |  | 294 | ​ | 0.5 | ​ |  | 331 | ​ | 0.6 | ​
Real Estate Mortgage: | ​ |  | ​ | ​ | ​ | ​ |  | ​ | ​ | ​ | ​
1 - 4 Family Mortgage | ​ |  | 2,432 | ​ | 4.3 | ​ |  | 2,795 | ​ | 5.3 | ​
Multifamily | ​ |  | 23,230 | ​ | 41.2 | ​ |  | 23,120 | ​ | 44.2 | ​
CRE Owner Occupied | ​ |  | 1,112 | ​ | 2.0 | ​ |  | 1,290 | ​ | 2.5 | ​
CRE Nonowner Occupied | ​ |  | 20,650 | ​ | 36.6 | ​ |  | 17,735 | ​ | 33.9 | ​
Total Real Estate Mortgage Loans | ​ |  | 47,424 |  | 84.1 | ​ |  | 44,940 |  | 85.9 | ​
Consumer and Other | ​ |  | 181 | ​ | 0.3 | ​ |  | 142 | ​ | 0.3 | ​
Total Allowance for Credit Losses | ​ | $ | 56,390 |  | 100.0 | % | $ | 52,277 |  | 100.0 | %

​

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Deposits

The principal sources of funds for the Company are deposits, consisting of demand deposits, money market accounts, savings accounts, and certificates of deposit. The following table presents the dollar and percentage composition of the deposit portfolio, by category, at the dates indicated:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025 | ​ | ​ | June 30, 2025 | ​ | ​ | March 31, 2025 | ​ | ​ | December 31, 2024 | ​ | ​ | September 30, 2024 | ​ | ​
(dollars in thousands) |  | Amount |  | Percent |  | ​ | Amount |  | Percent |  | ​ | Amount |  | Percent |  | ​ | Amount |  | Percent |  | ​ | Amount |  | Percent |  | ​
Noninterest Bearing Transaction Deposits | ​ | $ | 822,632 | ​ | 19.1 | % | ​ | $ | 787,868 | ​ | 18.6 | % | ​ | $ | 791,528 | ​ | 19.0 | % | ​ | $ | 800,763 | ​ | 19.6 | % | ​ | $ | 713,309 | ​ | 19.0 | % | ​
Interest Bearing Transaction Deposits | ​ |  | 860,774 | ​ | 20.1 | ​ | ​ |  | 791,748 | ​ | 18.7 | ​ | ​ |  | 840,378 | ​ | 20.2 | ​ | ​ |  | 862,242 | ​ | 21.1 | ​ | ​ |  | 805,756 | ​ | 21.5 | ​ | ​
Savings and Money Market Deposits | ​ |  | 1,428,726 | ​ | 33.3 | ​ | ​ |  | 1,441,694 | ​ | 34.0 | ​ | ​ |  | 1,372,191 | ​ | 33.0 | ​ | ​ |  | 1,259,503 | ​ | 30.8 | ​ | ​ |  | 980,345 | ​ | 26.2 | ​ | ​
Time Deposits | ​ |  | 346,214 | ​ | 8.1 | ​ | ​ |  | 344,882 | ​ | 8.1 | ​ | ​ |  | 326,821 | ​ | 7.8 | ​ | ​ |  | 338,506 | ​ | 8.3 | ​ | ​ |  | 347,080 | ​ | 9.3 | ​ | ​
Brokered Deposits | ​ |  | 834,418 | ​ | 19.4 | ​ | ​ |  | 870,550 | ​ | 20.6 | ​ | ​ |  | 831,539 | ​ | 20.0 | ​ | ​ |  | 825,753 | ​ | 20.2 | ​ | ​ |  | 900,952 | ​ | 24.0 | ​ | ​
Total Deposits | ​ | $ | 4,292,764 | ​ | 100.0 | % | ​ | $ | 4,236,742 | ​ | 100.0 | % | ​ | $ | 4,162,457 | ​ | 100.0 | % | ​ | $ | 4,086,767 | ​ | 100.0 | % | ​ | $ | 3,747,442 | ​ | 100.0 | % | ​

​

Total deposits at September 30, 2025 were $4.29 billion, an increase of $206.0 million, or 5.0%, compared to total deposits of $4.09 billion at December 31, 2024, and an increase of $545.3 million, or 14.6%, over total deposits of $3.75 billion at September 30, 2024. Core deposits, defined as total deposits excluding brokered deposits and time deposits greater than $250,000, increased $172.0 million, or 7.4% annualized, from December 31, 2024. Growth in core deposits was primarily due to both increased balances of existing clients and new client acquisitions. Based on the nature of the Company’s client base, management believes core deposits could fluctuate in future periods as deposit growth is not always linear.

​

The Company relies on increasing the deposit base to fund loans and other asset growth. The Company is in a highly competitive market and competes for local deposits by offering attractive products with competitive rates. The Company expects to have a higher average cost of funds for local deposits compared to competitor banks due to the lack of an extensive branch network. The Company’s strategy is to offset the higher cost of funding with a lower level of operating expense. When appropriate, the Company utilizes alternative funding sources such as brokered deposits. The brokered deposit market provides flexibility in structure, optionality and efficiency not afforded in traditional retail deposit channels. As of September 30, 2025, total brokered deposits were $834.4 million, an increase of $8.7 million, compared to total brokered deposits of $825.8 million at December 31, 2024. Brokered deposits continue to be used as a supplemental funding source, as needed, to support loan portfolio growth.

​

The following table presents the average balance and average rate paid on each of the following deposit categories as of and for the three months ended September 30, 2025 and 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | As of and for the | ​ | As of and for the | ​
​ | ​ | Three Months Ended | ​ | Three Months Ended | ​
​ | ​ | September 30, 2025 | ​ | September 30, 2024 | ​
​ | ​ | Average | ​ | Average | ​ | Average | ​ | Average | ​
(dollars in thousands) |  | Balance |  | Rate |  | Balance |  | Rate | ​
Noninterest Bearing Transaction Deposits | ​ | $ | 793,760 | ​ | — | % | $ | 710,192 | ​ | — | %
Interest Bearing Transaction Deposits | ​ |  | 843,905 | ​ | 3.78 | ​ |  | 804,161 | ​ | 4.63 | ​
Savings and Money Market Deposits | ​ |  | 1,473,465 | ​ | 3.63 | ​ |  | 939,665 | ​ | 4.34 | ​
Time Deposits < $250,000 | ​ |  | 170,163 | ​ | 4.28 | ​ |  | 184,397 | ​ | 4.01 | ​
Time Deposits > $250,000 | ​ |  | 172,763 | ​ | 4.29 | ​ |  | 170,653 | ​ | 4.80 | ​
Brokered Deposits | ​ |  | 856,516 | ​ | 4.36 | ​ |  | 989,712 | ​ | 4.28 | ​
Total Deposits | ​ | $ | 4,310,572 |  | 3.19 | % | $ | 3,798,780 |  | 3.58 | %

​

The Company’s total uninsured deposits, which are the amounts of deposit accounts that exceed the FDIC insurance limit, currently $250,000, were approximately $1.26 billion, or 29.2% of total deposits, at

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September 30, 2025 and $1.14 billion, or 27.7% of total deposits, at December 31, 2024. These amounts were estimated based on the same methodologies and assumptions used for regulatory reporting purposes.

Borrowed Funds

Other Borrowings

At September 30, 2025, the Company had outstanding FHLB advances of $404.5 million, compared to $359.5 million at December 31, 2024. The Company’s borrowing capacity at the FHLB is determined based on collateral pledged, generally consisting of loans. The Company had additional borrowing capacity under this credit facility of $493.6 million and $483.2 million at September 30, 2025 and December 31, 2024, respectively.

The Company has an outstanding Loan and Security Agreement and revolving note with a third party correspondent lender, which is secured by 100% of the issued and outstanding stock of the Bank. The maximum principal amount of the revolving line of credit is $40.0 million, and the facility matures on September 1, 2026. As of September 30, 2025 the Company had no outstanding balance under the revolving line of credit, compared to $13.8 million as of December 31, 2024. The Company also has two outstanding letters of credit totaling $6.4 million under this facility as of both September 30, 2025 and December 31, 2024.

Additionally, the Company has borrowing capacity from other sources. As of September 30, 2025, the Bank was eligible to use the Federal Reserve discount window for borrowings. Based on assets pledged as collateral as of the applicable date, the Bank’s borrowing availability was approximately $994.0 million and $925.8 million at September 30, 2025 and December 31, 2024, respectively. As of September 30, 2025 and December 31, 2024, the Company had no outstanding advances from the discount window.

Subordinated Debentures

As of September 30, 2025 and December 31, 2024, the Company had subordinated debentures, net of issuance costs, of $108.6 million and $79.7 million, respectively.

For additional information, see “Note 9 – Subordinated Debentures” of the Company’s Consolidated Financial Statements included as part of this report.

Contractual Obligations

The following table presents supplemental information regarding total contractual obligations at September 30, 2025:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Within |  | One to |  | Three to |  | After |  | ​
(dollars in thousands) | ​ | One Year | ​ | Three Years | ​ | Five Years | ​ | Five Years | ​ | Total
Deposits Without a Stated Maturity | ​ | $ | 3,261,497 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | 3,261,497
Time Deposits | ​ |  | 663,327 | ​ | ​ | 197,970 | ​ | ​ | 169,970 | ​ | ​ | — | ​ | ​ | 1,031,267
FHLB Advances | ​ |  | 320,500 | ​ | ​ | 61,500 | ​ | ​ | 22,500 | ​ | ​ | — | ​ | ​ | 404,500
Subordinated Debentures | ​ |  | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 110,000 | ​ | ​ | 110,000
Commitment to Fund Tax Credit Investments | ​ | ​ | 2,212 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 2,212
Operating Lease Obligations | ​ |  | 586 | ​ | ​ | 754 | ​ | ​ | 304 | ​ | ​ | 22 | ​ | ​ | 1,666
Totals | ​ | $ | 4,248,122 | ​ | $ | 260,224 | ​ | $ | 192,774 | ​ | $ | 110,022 | ​ | $ | 4,811,142

​

The Company believes that it will be able to meet all contractual obligations as they come due through the maintenance of adequate cash levels. The Company expects to maintain adequate cash levels through earnings, loan

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and securities repayments and maturity activity and continued deposit gathering activities. As described above, the Company has in place various borrowing mechanisms for both short-term and long-term liquidity needs.

Capital

Total shareholders’ equity at September 30, 2025 was $497.5 million, an increase of $39.5 million, or 8.6%, compared to total shareholders’ equity of $457.9 million at December 31, 2024. The increase was primarily due to net income retained and a decrease in unrealized losses in the securities portfolio, offset partially by a decrease in unrealized gains in the derivatives portfolio, preferred stock dividends, and stock repurchases.

Tangible book value per share, a non-GAAP financial measure, was $14.93 as of September 30, 2025, an increase of 10.7% from $13.49 as of December 31, 2024. Tangible common equity as a percentage of tangible assets, a non-GAAP financial measure, was 7.71% at September 30, 2025, compared to 7.36% at December 31, 2024.

Stock Repurchase Program. The Company did not repurchase any shares of its common stock pursuant to its existing stock repurchase program during the three months ended September 30, 2025. During the nine months ended September 30, 2025, the Company repurchased 167,709 shares of its common stock, representing 0.61% of the Company’s issued and outstanding shares as of September 30, 2025. Shares were repurchased during this period at a weighted average price of $13.07 per share, for a total of $2.2 million. All shares repurchased under the stock repurchase program were converted to authorized but unissued shares. As of September 30, 2025, the remaining amount that could be used to repurchase shares under the 2022 Stock Repurchase Program was $13.1 million. The Company remains committed to maintaining strong capital levels while enhancing shareholder value as it strategically executes its stock repurchase program based on various factors including valuation, capital levels and other uses of capital.

Regulatory Capital. The Company and the Bank are subject to various regulatory capital requirements administered by federal banking regulators. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by federal banking regulators that, if undertaken, could have a direct material effect on the Company’s and Bank’s business.

Management believes the Company and the Bank met all capital adequacy requirements to which they were subject as of September 30, 2025. The regulatory capital ratios necessary for the Company and the Bank to meet minimum capital adequacy standards, and for the Bank to be considered well capitalized under the prompt corrective action framework, are set forth in the following tables. The Company’s and the Bank’s actual capital amounts and ratios as of the dates indicated are presented in the following tables:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | Minimum Required | ​ | For Capital Adequacy | ​ | To be Well Capitalized | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | For Capital Adequacy | ​ | Purposes Plus Capital | ​ | Under Prompt Corrective | ​
​ | ​ | Actual | ​ | Purposes | ​ | Conservation Buffer | ​ | Action Regulations | ​
(dollars in thousands) |  | Amount |  | Ratio |  | Amount |  | Ratio |  | Amount |  | Ratio | ​ | Amount |  | Ratio | ​
September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Company (Consolidated): | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Risk-based Capital | ​ | $ | 652,426 | ​ | 14.12 | % | $ | 369,556 | ​ | 8.00 | % | $ | 485,042 | ​ | 10.50 | % | ​ | N/A | ​ | N/A | ​
Tier 1 Risk-based Capital | ​ | ​ | 486,065 | ​ | 10.52 | ​ | ​ | 277,167 | ​ | 6.00 | ​ | ​ | 392,653 | ​ | 8.50 | ​ | ​ | N/A | ​ | N/A | ​
Common Equity Tier 1 Capital | ​ | ​ | 419,551 | ​ | 9.08 | ​ | ​ | 207,875 | ​ | 4.50 | ​ | ​ | 323,361 | ​ | 7.00 | ​ | ​ | N/A | ​ | N/A | ​
Tier 1 Leverage Ratio | ​ | ​ | 486,065 | ​ | 9.02 | ​ | ​ | 215,446 | ​ | 4.00 | ​ | ​ | 215,446 | ​ | 4.00 | ​ | ​ | N/A | ​ | N/A | ​
Bank: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Risk-based Capital | ​ | $ | 619,058 | ​ | 13.43 | % | $ | 368,824 | ​ | 8.00 | % | $ | 484,082 | ​ | 10.50 | % | $ | 461,030 | ​ | 10.00 | %
Tier 1 Risk-based Capital | ​ | ​ | 561,397 | ​ | 12.18 | ​ | ​ | 276,618 | ​ | 6.00 | ​ | ​ | 391,876 | ​ | 8.50 | ​ | ​ | 368,824 | ​ | 8.00 | ​
Common Equity Tier 1 Capital | ​ | ​ | 561,397 | ​ | 12.18 | ​ | ​ | 207,464 | ​ | 4.50 | ​ | ​ | 322,721 | ​ | 7.00 | ​ | ​ | 299,670 | ​ | 6.50 | ​
Tier 1 Leverage Ratio | ​ | ​ | 561,397 | ​ | 10.43 | ​ | ​ | 215,230 | ​ | 4.00 | ​ | ​ | 215,230 | ​ | 4.00 | ​ | ​ | 269,037 | ​ | 5.00 | ​

​

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​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | Minimum Required | ​ | For Capital Adequacy | ​ | To be Well Capitalized | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | For Capital Adequacy | ​ | Purposes Plus Capital | ​ | Under Prompt Corrective | ​
​ | ​ | Actual | ​ | Purposes | ​ | Conservation Buffer | ​ | Action Regulations | ​
(dollars in thousands) |  | Amount |  | Ratio |  | Amount |  | Ratio |  | Amount |  | Ratio | ​ | Amount |  | Ratio | ​
December 31, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Company (Consolidated): | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Risk-based Capital | ​ | $ | 585,966 | ​ | 13.76 | % | $ | 340,581 | ​ | 8.00 | % | $ | 447,013 | ​ | 10.50 | % | ​ | N/A | ​ | N/A | ​
Tier 1 Risk-based Capital | ​ | ​ | 453,049 | ​ | 10.64 | ​ | ​ | 255,436 | ​ | 6.00 | ​ | ​ | 361,867 | ​ | 8.50 | ​ | ​ | N/A | ​ | N/A | ​
Common Equity Tier 1 Capital | ​ | ​ | 386,535 | ​ | 9.08 | ​ | ​ | 191,577 | ​ | 4.50 | ​ | ​ | 298,008 | ​ | 7.00 | ​ | ​ | N/A | ​ | N/A | ​
Tier 1 Leverage Ratio | ​ | ​ | 453,049 | ​ | 9.44 | ​ | ​ | 191,878 | ​ | 4.00 | ​ | ​ | 191,878 | ​ | 4.00 | ​ | ​ | N/A | ​ | N/A | ​
Bank: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Risk-based Capital | ​ | $ | 573,158 | ​ | 13.49 | % | $ | 340,003 | ​ | 8.00 | % | $ | 446,254 | ​ | 10.50 | % | $ | 425,004 | ​ | 10.00 | %
Tier 1 Risk-based Capital | ​ | ​ | 520,000 | ​ | 12.24 | ​ | ​ | 255,002 | ​ | 6.00 | ​ | ​ | 361,253 | ​ | 8.50 | ​ | ​ | 340,003 | ​ | 8.00 | ​
Common Equity Tier 1 Capital | ​ | ​ | 520,000 | ​ | 12.24 | ​ | ​ | 191,252 | ​ | 4.50 | ​ | ​ | 297,503 | ​ | 7.00 | ​ | ​ | 276,253 | ​ | 6.50 | ​
Tier 1 Leverage Ratio | ​ | ​ | 520,000 | ​ | 10.86 | ​ | ​ | 191,593 | ​ | 4.00 | ​ | ​ | 191,593 | ​ | 4.00 | ​ | ​ | 239,491 | ​ | 5.00 | ​

​

Regulations include a capital conservation buffer of 2.5% that is added to the minimum requirements for capital adequacy purposes. A banking organization with a conservation buffer of less than the required amount is subject to limitations on capital distributions, including dividend payments, stock repurchases and certain discretionary bonus payments to executive officers. At September 30, 2025, the ratios for the Company and the Bank were sufficient to meet the conservation buffer.

Off-Balance Sheet Arrangements

In the normal course of business, the Company enters into various transactions to meet the financing needs of clients, which, in accordance with GAAP, are not included in the consolidated balance sheets. These transactions include commitments to extend credit, standby letters of credit, and commercial letters of credit, which involve, to varying degrees, elements of credit risk and interest rate risk in excess of the amounts recognized in the consolidated balance sheets. Most of these commitments mature within two years and the standby letters of credit are expected to expire without being drawn upon. All off-balance sheet commitments are included in the determination of the amount of risk-based capital that the Company and the Bank are required to hold.

The Company’s exposure to credit loss in the event of non-performance by the other party to the financial instrument for commitments to extend credit, standby letters of credit, and commercial letters of credit is represented by the contractual or notional amount of those instruments. The Company decreases its exposure to losses under these commitments by subjecting them to credit approval and monitoring procedures. The Company assesses the credit risk associated with certain commitments to extend credit and establishes a liability for probable credit losses.

The following table presents credit arrangements and financial instruments whose contract amounts represented credit risk as of September 30, 2025 and December 31, 2024:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025 | ​ | December 31, 2024
​ |  | Fixed |  | Variable |  | Fixed |  | Variable
(dollars in thousands) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Unfunded Commitments Under Lines of Credit | ​ | $ | 244,628 | ​ | $ | 550,160 | ​ | $ | 174,273 | ​ | $ | 504,791
Letters of Credit | ​ |  | 24,664 | ​ |  | 108,874 | ​ |  | 9,012 | ​ |  | 115,385
Totals | ​ | $ | 269,292 | ​ | $ | 659,034 | ​ | $ | 183,285 | ​ | $ | 620,176

​

The Company had outstanding letters of credit with the FHLB of $135.4 million and $103.2 million at September 30, 2025 and December 31, 2024, respectively, on behalf of customers and to secure public deposits.

Liquidity

Liquidity is the Company’s capacity to meet cash and collateral obligations at a reasonable cost. Maintaining an adequate level of liquidity depends on the Company’s ability to efficiently meet both expected and unexpected cash

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flow and collateral needs without adversely affecting either daily operations or financial condition. The Bank’s Asset Liability Management, or ALM, Committee, is responsible for managing commitments to meet the needs of customers while achieving the Company’s financial objectives. The ALM Committee meets regularly to review balance sheet composition, funding capacities, and current and forecasted loan demand.

The Company manages liquidity by maintaining adequate levels of cash and other assets from on- and off-balance sheet arrangements. Specifically, on-balance sheet liquidity consists of cash and due from banks and unpledged investment securities available for sale, which are referred to as primary liquidity. In regards to off-balance sheet capacity, the Company maintains available borrowing capacity under secured borrowing lines with the FHLB, the Federal Reserve Bank of Minneapolis, and a correspondent lender, as well as unsecured lines of credit for the purpose of overnight funds with various correspondent banks, which the Company refers to as secondary liquidity.

Total on- and off-balance sheet liquidity was $2.39 billion as of September 30, 2025, compared to $2.30 billion at December 31, 2024.

​

The following tables present a summary of primary and secondary liquidity levels as of the dates indicated:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Primary Liquidity—On-Balance Sheet |  | September 30, 2025 |  | December 31, 2024 |
(dollars in thousands) | ​ | ​ | ​ | ​ | ​ | ​ |
Cash and Cash Equivalents | ​ | $ | 109,903 | ​ | $ | 188,884 | ​
Securities Available for Sale | ​ |  | 826,473 | ​ |  | 768,247 | ​
Less: Pledged Securities | ​ | ​ | (264,901) | ​ | ​ | (289,903) | ​
Total Primary Liquidity | ​ | $ | 671,475 | ​ | $ | 667,228 | ​
Ratio of Primary Liquidity to Total Deposits | ​ |  | 15.6 | % |  | 16.3 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Secondary Liquidity—Off-Balance Sheet | ​ | ​ | ​ | ​ |
(dollars in thousands) | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Secured Borrowing Capacity with the FHLB | ​ | $ | 493,644 | ​ | $ | 483,245 | ​
Net Secured Borrowing Capacity with the Federal Reserve Bank | ​ |  | 994,039 | ​ |  | 925,798 | ​
Unsecured Borrowing Capacity with Correspondent Lenders | ​ |  | 200,000 | ​ |  | 200,000 | ​
Secured Borrowing Capacity with Correspondent Lender | ​ | ​ | 33,605 | ​ | ​ | 19,855 | ​
Total Secondary Liquidity | ​ | ​ | 1,721,288 | ​ | ​ | 1,628,898 | ​
Total Primary and Secondary Liquidity | ​ | $ | 2,392,763 | ​ | $ | 2,296,126 | ​
Ratio of Primary and Secondary Liquidity to Total Deposits | ​ |  | 55.7 | % |  | 56.2 | %

​

​

During the nine months ended September 30, 2025, primary liquidity increased by $4.2 million due to a $58.2 million increase in securities available for sale and a $25.0 million decrease in pledged securities, offset partially by a $79.0 million decrease in cash and cash equivalents, when compared to December 31, 2024. Secondary liquidity increased by $92.4 million as of September 30, 2025, when compared to December 31, 2024, due to a $68.2 million increase in the borrowing capacity with the Federal Reserve Bank, a $13.8 million increase in the borrowing capacity with correspondent lenders, and a $10.4 million increase in borrowing capacity with the FHLB.

In addition to primary liquidity, the Company generates liquidity from cash flows from the loan and securities portfolios and from the large base of core deposits, defined as noninterest bearing transaction, interest bearing transaction, savings, non-brokered money market accounts and non-brokered time deposits less than $250,000. At September 30, 2025, core deposits totaled approximately $3.28 billion and represented 76.4% of total deposits. These core deposits are normally less volatile, often with customer relationships tied to other products offered by the Company, which promote long-standing relationships and stable funding sources.

The Company uses brokered deposits, the availability of which is uncertain and subject to competitive market forces and regulation, for liquidity and interest rate risk management purposes. At September 30, 2025, brokered deposits totaled $834.4 million, consisting of $685.1 million of brokered time deposits and $149.4 million of non-maturity brokered money market and transaction accounts. At December 31, 2024, brokered deposits totaled $825.8

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million, consisting of $698.3 million of brokered time deposits and $127.4 million of non-maturity brokered money market and transaction accounts.

The Company’s liquidity policy includes guidelines for On-Balance Sheet Liquidity (a measurement of primary liquidity to total deposits plus borrowings), Total On-Balance Sheet Liquidity with Borrowing Capacity (a measurement of primary and secondary liquidity to total deposits plus borrowings), Wholesale Funding Ratio (a measurement of total wholesale funding to total deposits plus borrowings), and other guidelines developed for measuring and maintaining liquidity.

​

Non-GAAP Financial Measures

In addition to financial measures presented in accordance with GAAP, the Company routinely supplements its evaluation with an analysis of certain non-GAAP financial measures. The Company believes these non-GAAP financial measures, in addition to the related GAAP measures, provide meaningful information to investors to help them understand the Company’s operating performance and trends, and to facilitate comparisons with the performance of peers. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of non-GAAP disclosures used in this report to the comparable GAAP measures are provided in the following tables:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the Three Months Ended | ​ | For the Nine Months Ended | ​
​ | ​ | September 30, | ​ | June 30, | ​ | March 31, | ​ | December 31, | ​ | September 30, | ​ | September 30, | ​ | September 30, | ​
(dollars in thousands) | ​ | 2025 |  | 2025 |  | 2024 |  | 2024 | ​ | 2024 | ​ | 2025 |  | 2024 | ​
Pre-Provision Net Revenue | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Noninterest Income | ​ | $ | 2,061 | ​ | $ | 3,627 | ​ | $ | 2,079 | ​ | $ | 2,533 | ​ | $ | 1,522 | ​ | $ | 7,767 | ​ | $ | 4,835 | ​
Less: (Gain) Loss on Sales of Securities | ​ | ​ | (59) | ​ | ​ | (474) | ​ | ​ | (1) | ​ | ​ | — | ​ | ​ | 28 | ​ | ​ | (534) | ​ | ​ | (385) | ​
Less: FHLB Advance Prepayment Income | ​ | ​ | — | ​ | ​ | (301) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (301) | ​ | ​ | — | ​
Total Operating Noninterest Income | ​ | ​ | 2,002 | ​ | ​ | 2,852 | ​ | ​ | 2,078 | ​ | ​ | 2,533 | ​ | ​ | 1,550 | ​ | ​ | 6,932 | ​ | ​ | 4,450 | ​
Plus: Net Interest Income | ​ | ​ | 34,091 | ​ | ​ | 32,452 | ​ | ​ | 30,208 | ​ | ​ | 26,967 | ​ | ​ | 25,599 | ​ | ​ | 96,751 | ​ | ​ | 75,226 | ​
Net Operating Revenue | ​ | $ | 36,093 | ​ | $ | 35,304 | ​ | $ | 32,286 | ​ | $ | 29,500 | ​ | $ | 27,149 | ​ | $ | 103,683 | ​ | $ | 79,676 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Noninterest Expense | ​ | $ | 19,956 | ​ | $ | 18,941 | ​ | $ | 18,136 | ​ | $ | 16,812 | ​ | $ | 15,760 | ​ | $ | 57,033 | ​ | $ | 46,488 | ​
Total Operating Noninterest Expense | ​ | $ | 19,956 | ​ | $ | 18,941 | ​ | $ | 18,136 | ​ | $ | 16,812 | ​ | $ | 15,760 | ​ | $ | 57,033 | ​ | $ | 46,488 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Pre-Provision Net Revenue | ​ | $ | 16,137 | ​ | $ | 16,363 | ​ | $ | 14,150 | ​ | $ | 12,688 | ​ | $ | 11,389 | ​ | $ | 46,650 | ​ | $ | 33,188 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Plus: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Non-Operating Revenue Adjustments | ​ | ​ | 59 | ​ | ​ | 775 | ​ | ​ | 1 | ​ | ​ | — | ​ | ​ | (28) | ​ | ​ | 835 | ​ | ​ | 385 | ​
Less: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Provision for Credit Losses | ​ | ​ | 1,100 | ​ | ​ | 2,000 | ​ | ​ | 1,500 | ​ | ​ | 2,175 | ​ | ​ | — | ​ | ​ | 4,600 | ​ | ​ | 1,350 | ​
Provision for Income Taxes | ​ | ​ | 3,495 | ​ | ​ | 3,618 | ​ | ​ | 3,018 | ​ | ​ | 2,309 | ​ | ​ | 2,686 | ​ | ​ | 10,131 | ​ | ​ | 7,602 | ​
Net Income | ​ | $ | 11,601 | ​ | $ | 11,520 | ​ | $ | 9,633 | ​ | $ | 8,204 | ​ | $ | 8,675 | ​ | $ | 32,754 | ​ | $ | 24,621 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Average Assets | ​ | $ | 5,372,443 | ​ | $ | 5,162,182 | ​ | $ | 5,071,446 | ​ | $ | 4,788,036 | ​ | $ | 4,703,804 | ​ | $ | 5,205,747 | ​ | $ | 4,647,925 | ​
Pre-Provision Net Revenue Return on Average Assets | ​ | ​ | 1.19 | % | ​ | 1.27 | % | ​ | 1.13 | % | ​ | 1.05 | % | ​ | 0.96 | % | ​ | 1.20 | % | ​ | 0.95 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Adjusted Pre-Provision Net Revenue | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Operating Revenue | ​ | $ | 36,093 | ​ | $ | 35,304 | ​ | $ | 32,286 | ​ | $ | 29,500 | ​ | $ | 27,149 | ​ | $ | 103,683 | ​ | $ | 79,676 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Noninterest Expense | ​ | $ | 19,956 | ​ | $ | 18,941 | ​ | $ | 18,136 | ​ | $ | 16,812 | ​ | $ | 15,760 | ​ | $ | 57,033 | ​ | $ | 46,488 | ​
Less: Merger-related Expenses | ​ | ​ | (530) | ​ | ​ | (540) | ​ | ​ | (565) | ​ | ​ | (488) | ​ | ​ | (224) | ​ | ​ | (1,635) | ​ | ​ | (224) | ​
Adjusted Total Operating Noninterest Expense | ​ | $ | 19,426 | ​ | $ | 18,401 | ​ | $ | 17,571 | ​ | $ | 16,324 | ​ | $ | 15,536 | ​ | $ | 55,398 | ​ | $ | 46,264 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Adjusted Pre-Provision Net Revenue | ​ | $ | 16,667 | ​ | $ | 16,903 | ​ | $ | 14,715 | ​ | $ | 13,176 | ​ | $ | 11,613 | ​ | $ | 48,285 | ​ | $ | 33,412 | ​
Adjusted Pre-Provision Net Revenue Return on Average Assets | ​ | ​ | 1.23 | % | ​ | 1.31 | % | ​ | 1.18 | % | ​ | 1.09 | % | ​ | 0.98 | % | ​ | 1.24 | % | ​ | 0.96 | %

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​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the Three Months Ended | ​ | For the Nine Months Ended | ​
​ | ​ | September 30, | ​ | June 30, | ​ | March 31, | ​ | December 31, | ​ | September 30, | ​ | September 30, | ​ | September 30, | ​
(dollars in thousands) | ​ | 2025 |  | 2025 |  | 2025 |  | 2024 | ​ | 2024 | ​ | 2025 |  | 2024 |
Core Net Interest Margin | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Interest Income (Tax-equivalent Basis) |  | $ | 34,614 | ​ | $ | 32,770 | ​ | $ | 30,464 | ​ | $ | 27,254 | ​ | $ | 25,905 | ​ | $ | 97,848 | ​ | $ | 76,185 | ​
Less: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Loan Fees | ​ | ​ | (966) | ​ | ​ | (1,019) | ​ | ​ | (719) | ​ | ​ | (747) | ​ | ​ | (968) | ​ | ​ | (2,704) | ​ | ​ | (2,342) | ​
Purchase Accounting Accretion: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Loan Accretion | ​ | ​ | (380) | ​ | ​ | (425) | ​ | ​ | (342) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (1,147) | ​ | ​ | — | ​
Bond Accretion | ​ | ​ | (89) | ​ | ​ | (152) | ​ | ​ | (578) | ​ | ​ | (91) | ​ | ​ | — | ​ | ​ | (819) | ​ | ​ | — | ​
Bank-Owned Certificates of Deposit Accretion | ​ | ​ | (6) | ​ | ​ | (4) | ​ | ​ | (7) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (17) | ​ | ​ | — | ​
Deposit Certificates of Deposit Accretion | ​ | ​ | (13) | ​ | ​ | (37) | ​ | ​ | (38) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (88) | ​ | ​ | — | ​
Total Purchase Accounting Accretion | ​ | ​ | (488) | ​ | ​ | (618) | ​ | ​ | (965) | ​ | ​ | (91) | ​ | ​ | — | ​ | ​ | (2,071) | ​ | ​ | — | ​
Core Net Interest Income (Tax-equivalent Basis) | ​ | $ | 33,160 | ​ | $ | 31,133 | ​ | $ | 28,780 | ​ | $ | 26,416 | ​ | $ | 24,937 | ​ | $ | 93,073 | ​ | $ | 73,843 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Average Interest Earning Assets | ​ | $ | 5,223,139 | ​ | $ | 5,019,058 | ​ | $ | 4,928,283 | ​ | $ | 4,682,841 | ​ | $ | 4,595,521 | ​ | $ | 5,060,374 | ​ | $ | 4,544,932 | ​
Core Net Interest Margin | ​ | ​ | 2.52 | % | ​ | 2.49 | % | ​ | 2.37 | % | ​ | 2.24 | % | ​ | 2.16 | % | ​ | 2.46 | % | ​ | 2.17 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Core Loan Yield | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Loan Interest Income (Tax-equivalent Basis) | ​ | $ | 60,317 | ​ | $ | 58,122 | ​ | $ | 53,979 | ​ | $ | 52,078 | ​ | $ | 52,118 | ​ | $ | 172,418 | ​ | $ | 153,567 | ​
Less: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Loan Fees | ​ | ​ | (966) | ​ | ​ | (1,019) | ​ | ​ | (719) | ​ | ​ | (747) | ​ | ​ | (968) | ​ | ​ | (2,704) | ​ | ​ | (2,342) | ​
Loan Accretion | ​ | ​ | (380) | ​ | ​ | (425) | ​ | ​ | (342) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (1,147) | ​ | ​ | — | ​
Core Loan Interest Income | ​ | $ | 58,971 | ​ | $ | 56,678 | ​ | $ | 52,918 | ​ | $ | 51,331 | ​ | $ | 51,150 | ​ | $ | 168,567 | ​ | $ | 151,225 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Average Loans | ​ | $ | 4,132,987 | ​ | $ | 4,064,540 | ​ | $ | 3,899,258 | ​ | $ | 3,730,532 | ​ | $ | 3,721,654 | ​ | $ | 4,034,656 | ​ | $ | 3,740,855 | ​
Core Loan Yield | ​ | ​ | 5.66 | % |  | 5.59 | % | ​ | 5.50 | % | ​ | 5.47 | % |  | 5.47 | % |  | 5.59 | % |  | 5.40 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Efficiency Ratio | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Noninterest Expense |  | $ | 19,956 | ​ | $ | 18,941 | ​ | $ | 18,136 | ​ | $ | 16,812 | ​ | $ | 15,760 | ​ | $ | 57,033 | ​ | $ | 46,488 | ​
Less: Amortization of Intangible Assets | ​ | ​ | (230) | ​ | ​ | (230) | ​ | ​ | (230) | ​ | ​ | (52) | ​ | ​ | (9) | ​ | ​ | (690) | ​ | ​ | (26) | ​
Adjusted Noninterest Expense | ​ | $ | 19,726 | ​ | $ | 18,711 | ​ | $ | 17,906 | ​ | $ | 16,760 | ​ | $ | 15,751 | ​ | $ | 56,343 | ​ | $ | 46,462 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Interest Income | ​ | $ | 34,091 | ​ | $ | 32,452 | ​ | $ | 30,208 | ​ | $ | 26,967 | ​ | $ | 25,599 | ​ | $ | 96,751 | ​ | $ | 75,226 | ​
Noninterest Income | ​ | ​ | 2,061 | ​ | ​ | 3,627 | ​ | ​ | 2,079 | ​ | ​ | 2,533 | ​ | ​ | 1,522 | ​ | ​ | 7,767 | ​ | ​ | 4,835 | ​
Less: Gain (Loss) on Sales of Securities | ​ | ​ | (59) | ​ | ​ | (474) | ​ | ​ | (1) | ​ | ​ | — | ​ | ​ | 28 | ​ | ​ | (534) | ​ | ​ | (385) | ​
Adjusted Operating Revenue | ​ | $ | 36,093 | ​ | $ | 35,605 | ​ | $ | 32,286 | ​ | $ | 29,500 | ​ | $ | 27,149 | ​ | $ | 103,984 | ​ | $ | 79,676 | ​
Efficiency Ratio | ​ |  | 54.7 | % |  | 52.6 | % |  | 55.5 | % |  | 56.8 | % |  | 58.0 | % |  | 54.2 | % |  | 58.3 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Adjusted Efficiency Ratio | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Noninterest Expense | ​ | $ | 19,956 | ​ | $ | 18,941 | ​ | $ | 18,136 | ​ | $ | 16,812 | ​ | $ | 15,760 | ​ | $ | 57,033 | ​ | $ | 46,488 | ​
Less: Amortization of Intangible Assets | ​ | ​ | (230) | ​ | ​ | (230) | ​ | ​ | (230) | ​ | ​ | (52) | ​ | ​ | (9) | ​ | ​ | (690) | ​ | ​ | (26) | ​
Less: Merger-related Expenses | ​ | ​ | (530) | ​ | ​ | (540) | ​ | ​ | (565) | ​ | ​ | (488) | ​ | ​ | (224) | ​ | ​ | (1,635) | ​ | ​ | (224) | ​
Adjusted Noninterest Expense | ​ | $ | 19,196 | ​ | $ | 18,171 | ​ | $ | 17,341 | ​ | $ | 16,272 | ​ | $ | 15,527 | ​ | $ | 54,708 | ​ | $ | 46,238 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Interest Income | ​ | $ | 34,091 | ​ | $ | 32,452 | ​ | $ | 30,208 | ​ | $ | 26,967 | ​ | $ | 25,599 | ​ | ​ | 96,751 | ​ | ​ | 75,226 | ​
Noninterest Income | ​ | ​ | 2,061 | ​ | ​ | 3,627 | ​ | ​ | 2,079 | ​ | ​ | 2,533 | ​ | ​ | 1,522 | ​ | ​ | 7,767 | ​ | ​ | 4,835 | ​
Less: FHLB Advance Prepayment Income | ​ | ​ | — | ​ | ​ | (301) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (301) | ​ | ​ | — | ​
Less: (Gain) Loss on Sales of Securities | ​ | ​ | (59) | ​ | ​ | (474) | ​ | ​ | (1) | ​ | ​ | — | ​ | ​ | 28 | ​ | ​ | (534) | ​ | ​ | (385) | ​
Adjusted Operating Revenue | ​ | $ | 36,093 | ​ | $ | 35,304 | ​ | $ | 32,286 | ​ | $ | 29,500 | ​ | $ | 27,149 | ​ | $ | 103,683 | ​ | $ | 79,676 | ​
Adjusted Efficiency Ratio | ​ |  | 53.2 | % |  | 51.5 | % |  | 53.7 | % |  | 55.2 | % |  | 57.2 | % | ​ | 52.8 | % | ​ | 58.0 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Adjusted Noninterest Expense to Average Assets (Annualized) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Noninterest Expense | ​ | $ | 19,956 | ​ | $ | 18,941 | ​ | $ | 18,136 | ​ | $ | 16,812 | ​ | $ | 15,760 | ​ | $ | 57,033 | ​ | $ | 46,488 | ​
Less: Merger-related Expenses | ​ | ​ | (530) | ​ | ​ | (540) | ​ | ​ | (565) | ​ | ​ | (488) | ​ | ​ | (224) | ​ | ​ | (1,635) | ​ | ​ | (224) | ​
Adjusted Noninterest Expense | ​ | $ | 19,426 | ​ | $ | 18,401 | ​ | $ | 17,571 | ​ | $ | 16,324 | ​ | $ | 15,536 | ​ | $ | 55,398 | ​ | $ | 46,264 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Average Assets | ​ | $ | 5,372,443 | ​ | $ | 5,162,182 | ​ | $ | 5,071,446 | ​ | $ | 4,788,036 | ​ | $ | 4,703,804 | ​ | $ | 5,205,747 | ​ | $ | 4,647,925 | ​
Adjusted Noninterest Expense to Average Assets (Annualized) | ​ | ​ | 1.43 | % | ​ | 1.43 | % | ​ | 1.41 | % | ​ | 1.36 | % | ​ | 1.31 | % | ​ | 1.42 | % | ​ | 1.33 | %

​

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​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the Three Months Ended | ​ | For the Nine Months Ended | ​
​ | ​ | September 30, | ​ | June 30, | ​ | March 31, | ​ | December 31, | ​ | September 30, | ​ | September 30, | ​ | September 30, | ​
(dollars in thousands) | ​ | 2025 |  | 2025 |  | 2025 |  | 2024 | ​ | 2024 |  | 2025 |  | 2024 | ​
Tangible Common Equity and Tangible Common Equity/Tangible Assets | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Shareholders' Equity | ​ | $ | 497,463 | ​ | $ | 476,282 | ​ | $ | 468,975 | ​ | $ | 457,935 | ​ | $ | 452,200 | ​ | ​ | ​ | ​ | ​ | ​ | ​
Less: Preferred Stock | ​ | ​ | (66,514) | ​ | ​ | (66,514) | ​ | ​ | (66,514) | ​ | ​ | (66,514) | ​ | ​ | (66,514) | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Common Shareholders' Equity | ​ | ​ | 430,949 | ​ | ​ | 409,768 | ​ | ​ | 402,461 | ​ | ​ | 391,421 | ​ | ​ | 385,686 | ​ | ​ | ​ | ​ | ​ | ​ | ​
Less: Intangible Assets | ​ | ​ | (19,142) | ​ | ​ | (19,372) | ​ | ​ | (19,602) | ​ | ​ | (19,832) | ​ | ​ | (2,789) | ​ | ​ | ​ | ​ | ​ | ​ | ​
Tangible Common Equity | ​ | $ | 411,807 | ​ | $ | 390,396 | ​ | $ | 382,859 | ​ | $ | 371,589 | ​ | $ | 382,897 | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total Assets | ​ | $ | 5,359,994 | ​ | $ | 5,296,673 | ​ | $ | 5,136,808 | ​ | $ | 5,066,242 | ​ | $ | 4,691,517 | ​ | ​ | ​ | ​ | ​ | ​ | ​
Less: Intangible Assets | ​ | ​ | (19,142) | ​ | ​ | (19,372) | ​ | ​ | (19,602) | ​ | ​ | (19,832) | ​ | ​ | (2,789) | ​ | ​ | ​ | ​ | ​ | ​ | ​
Tangible Assets | ​ | $ | 5,340,852 | ​ | $ | 5,277,301 | ​ | $ | 5,117,206 | ​ | $ | 5,046,410 | ​ | $ | 4,688,728 | ​ | ​ | ​ | ​ | ​ | ​ | ​
Tangible Common Equity/Tangible Assets | ​ |  | 7.71 | % |  | 7.40 | % |  | 7.48 | % |  | 7.36 | % |  | 8.17 | % | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Tangible Book Value Per Share | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Book Value Per Common Share | ​ | $ | 15.62 | ​ | $ | 14.92 | ​ | $ | 14.60 | ​ | $ | 14.21 | ​ | $ | 14.06 | ​ | ​ | ​ | ​ | ​ | ​ | ​
Less: Effects of Intangible Assets | ​ | ​ | (0.69) | ​ | ​ | (0.71) | ​ | ​ | (0.71) | ​ | ​ | (0.72) | ​ | ​ | (0.10) | ​ | ​ | ​ | ​ | ​ | ​ | ​
Tangible Book Value Per Common Share | ​ | $ | 14.93 | ​ | $ | 14.21 | ​ | $ | 13.89 | ​ | $ | 13.49 | ​ | $ | 13.96 | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Return on Average Tangible Common Equity | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Income Available to Common Shareholders | ​ | $ | 10,588 | ​ | $ | 10,506 | ​ | $ | 8,620 | ​ | $ | 7,190 | ​ | $ | 7,662 | ​ | $ | 29,714 | ​ | $ | 21,581 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Average Shareholders' Equity | ​ | $ | 485,869 | ​ | $ | 471,700 | ​ | $ | 465,408 | ​ | $ | 455,949 | ​ | $ | 443,077 | ​ | $ | 474,278 | ​ | $ | 435,664 | ​
Less: Average Preferred Stock | ​ | ​ | (66,514) | ​ | ​ | (66,514) | ​ | ​ | (66,514) | ​ | ​ | (66,514) | ​ | ​ | (66,514) | ​ | ​ | (66,514) | ​ | ​ | (66,514) | ​
Average Common Equity | ​ | ​ | 419,355 | ​ | ​ | 405,186 | ​ | ​ | 398,894 | ​ | ​ | 389,435 | ​ | ​ | 376,563 | ​ | ​ | 407,764 | ​ | ​ | 369,150 | ​
Less: Effects of Average Intangible Assets | ​ | ​ | (19,274) | ​ | ​ | (19,504) | ​ | ​ | (19,738) | ​ | ​ | (4,412) | ​ | ​ | (2,794) | ​ | ​ | (19,504) | ​ | ​ | (2,802) | ​
Average Tangible Common Equity | ​ | $ | 400,081 | ​ | $ | 385,682 | ​ | $ | 379,156 | ​ | $ | 385,023 | ​ | $ | 373,769 | ​ | $ | 388,260 | ​ | $ | 366,348 | ​
Return on Average Tangible Common Equity | ​ | ​ | 10.50 | % | ​ | 10.93 | % | ​ | 9.22 | % | ​ | 7.43 | % | ​ | 8.16 | % | ​ | 10.23 | % | ​ | 7.87 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Adjusted Diluted Earnings Per Common Share | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Income Available to Common Shareholders | ​ | $ | 10,588 | ​ | $ | 10,506 | ​ | $ | 8,620 | ​ | $ | 7,190 | ​ | $ | 7,662 | ​ | $ | 29,714 | ​ | $ | 21,581 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Add: Merger-related Expenses | ​ | ​ | 530 | ​ | ​ | 540 | ​ | ​ | 565 | ​ | ​ | 488 | ​ | ​ | 224 | ​ | ​ | 1,635 | ​ | ​ | 224 | ​
Less: FHLB Advance Prepayment Income | ​ | ​ | — | ​ | ​ | (301) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (301) | ​ | ​ | — | ​
Less: (Gain) Loss on Sales of Securities | ​ | ​ | (59) | ​ | ​ | (474) | ​ | ​ | (1) | ​ | ​ | — | ​ | ​ | 28 | ​ | ​ | (534) | ​ | ​ | (385) | ​
Total Adjustments | ​ | ​ | 471 | ​ | ​ | (235) | ​ | ​ | 564 | ​ | ​ | 488 | ​ | ​ | 252 | ​ | ​ | 800 | ​ | ​ | (161) | ​
Less: Tax Impact of Adjustments | ​ | ​ | (110) | ​ | ​ | 56 | ​ | ​ | (135) | ​ | ​ | (107) | ​ | ​ | (59) | ​ | ​ | (189) | ​ | ​ | 38 | ​
Adjusted Net Income Available to Common Shareholders | ​ | $ | 10,949 | ​ | $ | 10,327 | ​ | $ | 9,049 | ​ | $ | 7,571 | ​ | $ | 7,855 | ​ | $ | 30,325 | ​ | $ | 21,458 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Diluted Weighted Average Shares Outstanding | ​ | ​ | 28,190,406 | ​ | ​ | 27,998,008 | ​ | ​ | 28,036,506 | ​ | ​ | 28,055,532 | ​ | ​ | 27,904,910 | ​ | ​ | 28,089,409 | ​ | ​ | 27,919,784 | ​
Adjusted Diluted Earnings Per Common Share | ​ | $ | 0.39 | ​ | $ | 0.37 | ​ | $ | 0.32 | ​ | $ | 0.27 | ​ | $ | 0.28 | ​ | $ | 1.08 | ​ | $ | 0.77 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Adjusted Return on Average Assets | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Income | ​ | $ | 11,601 | ​ | $ | 11,520 | ​ | $ | 9,633 | ​ | $ | 8,204 | ​ | $ | 8,675 | ​ | $ | 32,754 | ​ | $ | 24,621 | ​
Add: Total Adjustments | ​ | ​ | 471 | ​ | ​ | (235) | ​ | ​ | 564 | ​ | ​ | 488 | ​ | ​ | 252 | ​ | ​ | 800 | ​ | ​ | (161) | ​
Less: Tax Impact | ​ | ​ | (110) | ​ | ​ | 56 | ​ | ​ | (135) | ​ | ​ | (107) | ​ | ​ | (59) | ​ | ​ | (189) | ​ | ​ | 38 | ​
Net Income, Excluding Impact of Merger-related Expenses | ​ | $ | 11,962 | ​ | $ | 11,341 | ​ | $ | 10,062 | ​ | $ | 8,585 | ​ | $ | 8,868 | ​ | $ | 33,365 | ​ | $ | 24,498 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Average Assets | ​ | $ | 5,372,443 | ​ | $ | 5,162,182 | ​ | $ | 5,071,446 | ​ | $ | 4,788,036 | ​ | $ | 4,703,804 | ​ | $ | 5,205,747 | ​ | $ | 4,647,925 | ​
Adjusted Return on Average Assets | ​ | ​ | 0.88 | % | ​ | 0.88 | % | ​ | 0.80 | % | ​ | 0.71 | % | ​ | 0.75 | % | ​ | 0.86 | % | ​ | 0.70 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Adjusted Return on Average Shareholders' Equity | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Income, Excluding Impact of Merger-related Expenses | ​ | $ | 11,962 | ​ | $ | 11,341 | ​ | $ | 10,062 | ​ | $ | 8,585 | ​ | $ | 8,868 | ​ | $ | 33,365 | ​ | $ | 24,498 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Average Shareholders' Equity | ​ | $ | 485,869 | ​ | $ | 471,700 | ​ | $ | 465,408 | ​ | $ | 455,949 | ​ | $ | 443,077 | ​ | $ | 474,278 | ​ | $ | 435,664 | ​
Adjusted Return on Average Shareholders' Equity | ​ | ​ | 9.77 | % | ​ | 9.64 | % | ​ | 8.77 | % | ​ | 7.49 | % | ​ | 7.96 | % | ​ | 9.41 | % | ​ | 7.51 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Adjusted Return on Average Tangible Common Equity | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net Income Available to Common Shareholders, Excluding Impact of Merger-related Expenses | ​ | $ | 10,949 | ​ | $ | 10,327 | ​ | $ | 9,049 | ​ | $ | 7,571 | ​ | $ | 7,855 | ​ | $ | 30,325 | ​ | $ | 21,458 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Average Tangible Common Equity | ​ | $ | 400,081 | ​ | $ | 385,682 | ​ | $ | 379,156 | ​ | $ | 385,023 | ​ | $ | 373,769 | ​ | $ | 388,260 | ​ | $ | 366,348 | ​
Adjusted Return on Average Tangible Common Equity | ​ | ​ | 10.86 | % | ​ | 10.74 | % | ​ | 9.68 | % | ​ | 7.82 | % | ​ | 8.36 | % | ​ | 10.44 | % | ​ | 7.82 | %

​

​

​

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

Interest Rate Risk

As a financial institution, the Company’s primary market risk is interest rate risk, which is defined as the risk of loss of net interest income or net interest margin because of changes in interest rates. The Company continually seeks to measure and manage the potential impact of interest rate risk. Interest rate risk occurs when interest earning assets and interest bearing liabilities mature or re-price at different times, on a different basis or in unequal amounts. Interest rate risk also arises when assets and liabilities each respond differently to changes in interest rates.

The Company’s management of interest rate risk is overseen by its ALM Committee, based on a risk management infrastructure approved by the board of directors that outlines reporting and measurement requirements. In particular, this infrastructure sets limits and management targets for various metrics, including net interest income simulation involving parallel shifts in interest rate curves, steepening and flattening yield curves, and various prepayment and deposit duration assumptions. The Company’s risk management infrastructure also requires a periodic review of all key assumptions used, such as identifying appropriate interest rate scenarios, setting loan prepayment rates based on historical analysis and noninterest bearing and interest bearing transaction deposit durations based on historical analysis. The Company does not engage in speculative trading activities relating to interest rates, foreign exchange rates, commodity prices, equities or credit.

The Company manages the interest rate risk associated with interest earning assets by managing the interest rates and terms associated with the investment securities portfolio by purchasing and selling investment securities from time to time. The Company manages the interest rate risk associated with interest bearing liabilities by managing the interest rates and terms associated with wholesale borrowings and deposits from customers which the Company relies on for funding. For example, the Company occasionally uses special offers on deposits to alter the interest rates and terms associated with interest bearing liabilities.

The Company has entered into certain hedging transactions including fair value swaps and interest rate swaps and caps, which are designed to lessen elements of the Company’s interest rate exposure. Cash flow hedge relationships mitigate exposure to the variability of future cash flows or other forecasted transactions. The Company utilizes cash flow hedges to manage interest rate exposure for the brokered deposit and wholesale borrowing portfolios. These cash flow hedges had a total notional amount of $308.0 million and $303.0 million at September 30, 2025 and December 31, 2024, respectively. Fair value hedge relationships mitigate exposure to changes in the fair value of a recognized asset or value. The Company utilizes fair value hedges to manage fair value exposure for the U.S. treasury security, mortgage-backed security, and municipal security portfolios. These fair value hedges had a total notional amount of $243.6 million and $145.9 million at September 30, 2025 and December 31, 2024, respectively. In the event that interest rates do not change in the manner anticipated, such transactions may adversely affect the Company’s results of operations.

Net Interest Income Simulation

The Company uses a net interest income simulation model to measure and evaluate potential changes in net interest income that would result over the next 12 months from immediate and sustained changes in interest rates as of the measurement date. This model has inherent limitations and the results are based on a given set of rate changes and assumptions as of a certain point in time. For purposes of the simulation, the Company assumes no growth in either interest-sensitive assets or liabilities over the next 12 months; therefore, the model’s results reflect an interest rate shock to a static balance sheet. The simulation model also incorporates various other assumptions, which the Company believes are reasonable but which may have a significant impact on results, such as: (1) the timing of changes in interest rates, (2) shifts or rotations in the yield curve, (3) re-pricing characteristics for market-rate-sensitive instruments, (4) differing sensitivities of financial instruments due to differing underlying rate indices, (5) varying loan prepayment speeds for different interest rate scenarios, (6) the effect of interest rate limitations in assets, such as

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floors and caps, and (7) overall growth and repayment rates and product mix of assets and liabilities. Because of the limitations inherent in any approach used to measure interest rate risk, simulation results are not intended as a forecast of the actual effect of a change in market interest rates on the results, but rather as a means to better plan and execute appropriate asset-liability management strategies and to manage interest rate risk.

Potential changes to the Company’s net interest income in hypothetical rising and declining rate scenarios calculated as of September 30, 2025 and December 31, 2024 are presented in the table below. The projections assume an immediate, parallel shift downward of the yield curve of 100, 200, 300, and 400 basis points and immediate, parallel shifts upward of the yield curve of 100, 200, 300 and 400 basis points.

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(dollars in thousands) | ​ | September 30, 2025 | ​ | December 31, 2024
Change (basis points) | ​ | Forecasted | ​ | Percentage | ​ | Forecasted | ​ | Percentage
in Interest Rates |  | Net Interest | ​ | Change |  | Net Interest | ​ | Change
(12-Month Projection) | ​ | Income | ​ | from Base | ​ | Income | ​ | from Base
+400 | ​ | $ | 138,605 | ​ | (10.03) | % | ​ | $ | 130,390 | ​ | (6.00) | %
+300 | ​ |  | 142,757 | ​ | (7.33) | ​ | ​ |  | 132,605 | ​ | (4.40) | ​
+200 | ​ |  | 146,468 | ​ | (4.92) | ​ | ​ |  | 134,355 | ​ | (3.14) | ​
+100 | ​ |  | 149,883 | ​ | (2.70) | ​ | ​ |  | 136,411 | ​ | (1.66) | ​
0 | ​ |  | 154,049 | ​ | — | ​ | ​ |  | 138,708 | ​ | — | ​
−100 | ​ | ​ | 160,743 | ​ | 4.35 | ​ | ​ | ​ | 143,038 | ​ | 3.12 | ​
−200 | ​ | ​ | 170,174 | ​ | 10.47 | ​ | ​ | ​ | 147,997 | ​ | 6.70 | ​
−300 | ​ | ​ | 182,264 | ​ | 18.32 | ​ | ​ | ​ | 153,515 | ​ | 10.67 | ​
−400 | ​ | ​ | 193,011 | ​ | 25.29 | ​ | ​ | ​ | 158,778 | ​ | 14.47 | ​

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The table above indicates that as of September 30, 2025, in the event of an immediate and sustained 400 basis point increase in interest rates, the Company would experience a 10.03% decrease in net interest income. In the event of an immediate 400 basis point decrease in interest rates, the Company would experience an 25.29% increase in net interest income.

The results of this simulation analysis are hypothetical, and a variety of factors might cause actual results to differ substantially from what is depicted. For example, if the timing and magnitude of interest rate changes differ from those projected, net interest income might vary significantly. Non-parallel yield curve shifts such as a flattening or steepening of the yield curve or changes in interest rate spreads would also cause net interest income to be different from that depicted. An increasing interest rate environment could reduce projected net interest income if deposits and other short-term liabilities re-price faster than expected or re-price faster than the Company’s assets. Actual results could differ from those projected if the Company grows assets and liabilities faster or slower than estimated, if the Company experienced a net outflow of deposit liabilities, or if the mix of assets and liabilities otherwise changes. Actual results could also differ from those projected if the Company experienced substantially different repayment speeds in the loan portfolio than those assumed in the simulation model. Finally, these simulation results do not contemplate all the actions that the Company may undertake in response to potential or actual changes in interest rates, such as changes to the Company’s loan, investment, deposit, or funding strategies.

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Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company’s Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the design and operation of the Company’s “disclosure controls and procedures” (as that term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, or the Exchange Act) as of September 30, 2025, the end of the fiscal quarter covered by this Quarterly Report on Form 10-Q. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of September 30, 2025, the Company’s disclosure controls and

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procedures were effective to ensure that the information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and is accumulated and communicated to the Company’s management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

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Changes in Internal Control Over Financial Reporting

There has been no change in the Company’s internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II – OTHER INFORMATION

Item 1. Legal Proceedings

Neither the Company nor any of its subsidiaries is a party, and no property of these entities is subject, to any material pending legal proceedings, other than ordinary routine litigation incidental to the Bank’s business. The Company does not know of any proceeding contemplated by a governmental authority against the Company or any of its subsidiaries.

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Item 1.A. Risk Factors

There have been no material changes to the risk factors disclosed in the Company’s Annual Report on Form 10-K filed with the SEC on March 6, 2025.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Repurchases of Equity Securities

The following table presents stock purchases made during the third quarter of 2025:

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Period | Total Number of Shares Purchased (1) | ​ | Average Price Paid Per Share | ​ | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) | ​ | Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
July 1 - 31, 2025 | 180 | ​ | $ | 16.23 | ​ | — | ​ | $ | 13,089,198
August 1 - 31, 2025 | — | ​ | ​ | — | ​ | — | ​ | ​ | 13,089,198
September 1 - 30, 2025 | — | ​ | ​ | — | ​ | — | ​ | ​ | 13,089,198
Total | 180 | ​ | $ | 16.23 | ​ | — | ​ | $ | 13,089,198

(1) | The total number of shares repurchased during the periods indicated includes shares repurchased as part of the Company’s stock repurchase program and shares withheld for income tax purposes in connection with vesting of restricted stock and stock options. The shares were purchased or otherwise valued at the closing price of the Company’s common stock on the date of purchase and/or withholding.

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(2) | On August 17, 2022, the Company’s board of directors approved the 2022 Stock Repurchase Program, which authorizes the Company to repurchase up to $25.0 million of its common stock, subject to certain limitations and conditions. On July 22, 2025, the Company’s board of directors extended the expiration date of the 2022 Stock Repurchase Program from August 20, 2025 to August 26, 2026. The 2022 Stock Repurchase Program does not obligate the Company to repurchase any shares of its common stock, and other than repurchases that have been completed to date, there is no assurance that the Company will do so. Under the 2022 Stock Repurchase Program, the Company may repurchase shares of common stock from time to time in open market or privately negotiated transactions. The extent to which the Company repurchases its shares, and the timing of such repurchases, will depend upon a variety of factors, including general market and economic conditions, regulatory requirements, availability of funds, and other relevant

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| considerations, as determined by the Company. The Company may, in its discretion, begin, suspend or terminate repurchases at any time prior to the 2022 Stock Repurchase Program’s expiration, without any prior notice.

Unregistered Sales of Equity Securities

None.

Use of Proceeds from Registered Securities

None.

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Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Rule 10b5-1 Trading Plans

During the quarter ended September 30, 2025, none of the Company’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10 b5-1(c) or any non-Rule 10 b5-1 trading arrangement.

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Item 6. Exhibits

| ​ |
Exhibit Number |  | Description
3.1 | ​ | Third Amended and Restated Articles of Incorporation of Bridgewater Bancshares, Inc. (incorporated herein by reference to Exhibit 3.1 on Form 8-K filed on April 27, 2023)
3.2 | ​ | Second Amended and Restated Bylaws of Bridgewater Bancshares, Inc. (incorporated herein by reference to Exhibit 3.2 on Form 8-K filed on April 27, 2023)
3.3 | ​ | Statement of Designation of 5.875% Non-Cumulative Perpetual Preferred Stock, Series A (incorporated herein by reference to Exhibit 3.1 on Form 8-K filed on August 17, 2021)
10.1 | ​ | First Amendment to Employment Agreement among Bridgewater Bancshares, Inc., Bridgewater Bank, and Mary Jane Crocker, dated August 18, 2025 (incorporated herein by reference to Exhibit 10.1 on Form 8-K filed on August 19, 2025)
10.2 | ​ | First Amendment to Employment Agreement among Bridgewater Bancshares, Inc., Bridgewater Bank, and Jeffrey Shellberg, dated August 18, 2025 (incorporated herein by reference to Exhibit 10.2 on Form 8-K filed on August 19, 2025)
31.1 | ​ | Certification of the Chief Executive Officer required, by Rule 13a-14(a) of the Securities Exchange Act of 1934, and Section 302 of the Sarbanes-Oxley Act of 2002
31.2 | ​ | Certification of the Chief Financial Officer required by Rule 13a-14(a) of the Securities Exchange Act of 1934, and Section 302 of the Sarbanes-Oxley Act of 2002
32.1 | ​ | Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2 | ​ | Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.1 | ​ | Financial information from the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2025, formatted in inline XBRL interactive data files pursuant to Rule 405 of Regulation S-T: (i) Consolidated Balance Sheets; (ii) Consolidated Statements of Income; (iii) Consolidated Statements of Comprehensive Income; (iv) Consolidated Statements of Shareholders’ Equity; (v) Consolidated Statements of Cash Flows; and (vi) Notes to Consolidated Financial Statements
104 | ​ | The cover page for Bridgewater Bancshares, Inc’s Form 10-Q Report for the quarterly period ended September 30, 2025 formatted in inline XBRL and contained in Exhibit 101

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

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​ |
​ | Bridgewater Bancshares, Inc.
​ | ​
Date: October 30, 2025 | By: | /s/ Jerry J. Baack
​ | Name: | Jerry J. Baack
​ | Title: | Chairman and Chief Executive Officer (Principal Executive Officer)
​ | ​
Date: October 30, 2025 | By: | /s/ Joe M. Chybowski
​ | Name: | Joe M. Chybowski
​ | Title: | President and Chief Financial Officer (Principal Financial Officer)
​ | ​

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