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What changed in CITY HOLDING CO's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of CITY HOLDING CO's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+234 added−224 removedSource: 10-K (2026-02-25) vs 10-K (2025-02-26)

Top changes in CITY HOLDING CO's 2025 10-K

234 paragraphs added · 224 removed · 201 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

50 edited+15 added−3 removed98 unchanged
Biggest changeThe Company’s minimum required capital ratios for both City Holding and City National include the 2.5% capital conservation buffer and are illustrated in the following tables (dollars in thousands): December 31, 2024 Actual Minimum Required - Basel III Required to be Considered Well Capitalized Capital Amount Ratio Capital Amount Ratio Capital Amount Ratio CET 1 Capital City Holding Company $ 688,707 16.5 % $ 291,989 7.0 % $ 271,133 6.5 % City National Bank 563,301 13.6 % 291,068 7.0 % 270,277 6.5 % Tier 1 Capital City Holding Company 688,707 16.5 % 354,558 8.5 % 333,702 8.0 % City National Bank 563,301 13.6 % 353,439 8.5 % 332,649 8.0 % Total Capital City Holding Company 709,820 17.0 % 437,983 10.5 % 417,127 10.0 % City National Bank 584,415 14.1 % 436,602 10.5 % 415,811 10.0 % Tier 1 Leverage Ratio City Holding Company 688,707 10.6 % 259,325 4.0 % 324,156 5.0 % City National Bank 563,301 8.7 % 258,477 4.0 % 323,096 5.0 % 8 December 31, 2023 Actual Minimum Required - Basel III Required to be Considered Well Capitalized Capital Amount Ratio Capital Amount Ratio Capital Amount Ratio CET 1 Capital City Holding Company $ 627,579 15.7 % $ 279,768 7.0 % $ 259,875 6.5 % City National Bank 549,031 13.8 % 278,692 7.0 % 258,785 6.5 % Tier 1 Capital City Holding Company 627,579 15.7 % 339,718 8.5 % 319,735 8.0 % City National Bank 549,031 13.8 % 338,412 8.5 % 318,505 8.0 % Total Capital City Holding Company 648,646 16.2 % 419,652 10.5 % 399,669 10.0 % City National Bank 570,099 14.3 % 418,038 10.5 % 398,131 10.0 % Tier 1 Leverage Ratio City Holding Company 627,579 10.2 % 245,468 4.0 % 306,835 5.0 % City National Bank 549,031 8.9 % 245,587 4.0 % 306,984 5.0 % Management believes that, as of December 31, 2024, City Holding and City National meet all capital adequacy requirements under Basel III.
Biggest changeThe Company’s minimum required capital ratios for both City Holding and City National include the 2.5% capital conservation buffer and are illustrated in the following tables (dollars in thousands): December 31, 2025 Actual Minimum Required - Basel III Required to be Considered Well Capitalized Capital Amount Ratio Capital Amount Ratio Capital Amount Ratio CET 1 Capital City Holding Company $ 730,153 16.9 % $ 301,848 7.0 % $ 280,287 6.5 % City National Bank 576,928 13.4 % 300,911 7.0 % 279,418 6.5 % Tier 1 Capital City Holding Company 730,453 16.9 % 366,530 8.5 % 344,969 8.0 % City National Bank 576,928 13.4 % 365,392 8.5 % 343,899 8.0 % Total Capital City Holding Company 750,319 17.4 % 452,772 10.5 % 431,211 10.0 % City National Bank 596,794 13.9 % 451,367 10.5 % 429,873 10.0 % Tier 1 Leverage Ratio City Holding Company 730,453 11.0 % 266,566 4.0 % 333,207 5.0 % City National Bank 576,928 8.7 % 265,801 4.0 % 332,252 5.0 % 8 December 31, 2024 Actual Minimum Required - Basel III Required to be Considered Well Capitalized Capital Amount Ratio Capital Amount Ratio Capital Amount Ratio CET 1 Capital City Holding Company $ 688,707 16.5 % $ 291,989 7.0 % $ 271,133 6.5 % City National Bank 563,301 13.6 % 291,068 7.0 % 270,277 6.5 % Tier 1 Capital City Holding Company 688,707 16.5 % 354,558 8.5 % 333,702 8.0 % City National Bank 563,301 13.6 % 353,439 8.5 % 332,649 8.0 % Total Capital City Holding Company 709,820 17.0 % 437,983 10.5 % 417,127 10.0 % City National Bank 584,415 14.1 % 436,602 10.5 % 415,811 10.0 % Tier 1 Leverage Ratio City Holding Company 688,707 10.6 % 259,325 4.0 % 324,156 5.0 % City National Bank 563,301 8.7 % 258,477 4.0 % 323,096 5.0 % Management believes that, as of December 31, 2025, City Holding and City National meet all capital adequacy requirements under Basel III.
Fixed rate mortgage loans are processed and underwritten in accordance with Fannie Mae and Freddie Mac guidelines, while adjustable rate mortgage loans are underwritten in accordance with City National's internal loan policy. 2 Consumer loans may be secured by automobiles, boats, recreational vehicles, certificates of deposit and other personal property, or they may be unsecured.
Fixed rate mortgage loans are processed and underwritten in accordance 2 with Fannie Mae and Freddie Mac guidelines, while adjustable rate mortgage loans are underwritten in accordance with City National's internal loan policy. Consumer loans may be secured by automobiles, boats, recreational vehicles, certificates of deposit and other personal property, or they may be unsecured.
To bring out the best in our employees and our Company, we introduced the "Integrity in Action" program that gives all employees additional resources to help protect our Company and uphold our high standards. We support all of the communities in which we serve, and our employees embrace this 4 opportunity.
To bring out the best in our employees and our Company, we introduced the "Integrity in Action" program that gives all employees additional resources to help protect our Company and 4 uphold our high standards. We support all of the communities in which we serve, and our employees embrace this opportunity.
Certain provisions affecting the Company include: • Simplifying regulatory capital requirements by providing that banks with less than $10 billion in total consolidated assets that meet a leverage ratio of tangible equity to average consolidated assets between eight and nine percent will be deemed to be in compliance with risk-based capital and leverage requirements. • Changing how federal financial institution regulators classify certain municipal securities assets under the liquidity coverage ratio rule; 7 • Exempting certain reciprocal deposits from treatment as brokered deposits under the FDIC's brokered deposits rule; • Exempting banks with less than $10 billion in total consolidated assets from certain provisions under the Volcker Rule; and • Authorizing new banking procedures to better facilitate online transactions.
Certain provisions affecting the Company include: • Simplifying regulatory capital requirements by providing that banks with less than $10 billion in total consolidated assets that meet a leverage ratio of tangible equity to average consolidated assets between eight and nine percent will be deemed to be in compliance with risk-based capital and leverage requirements. 7 • Changing how federal financial institution regulators classify certain municipal securities assets under the liquidity coverage ratio rule; • Exempting certain reciprocal deposits from treatment as brokered deposits under the FDIC's brokered deposits rule; • Exempting banks with less than $10 billion in total consolidated assets from certain provisions under the Volcker Rule; and • Authorizing new banking procedures to better facilitate online transactions.
City National also offers credit cards through an agreement with a third-party vendor. • Mortgage Banking - City National provides mortgage banking services, including fixed and adjustable-rate mortgages, construction financing, land loans, production of conventional and government insured mortgages, secondary marketing and mortgage servicing. • Wealth Management and Trust Services - City National offers specialized services and expertise in the areas of wealth management, trust, investment and custodial services for commercial and individual customers.
City National also offers credit cards through an agreement with a third-party vendor. • Mortgage Banking - City National provides mortgage banking services, including fixed and adjustable-rate mortgages, construction financing, land loans, production of conventional and government insured mortgages, secondary marketing and mortgage servicing. • Wealth and Investment Management Services - City National offers specialized services and expertise in the areas of wealth management, investment and custodial services for commercial and individual customers.
Cybersecurity Federal regulators issued two statements regarding cybersecurity: (i) a statement indicating that financial institutions should design multiple layers of security controls to establish lines of defense and to ensure that their risk management processes also address the risk posed by compromised customer credentials, including security measures to reliably authenticate customers accessing internet-based services of the financial institutions; and (ii) a statement indicating the expectation of a financial institution's management to maintain a sufficient business continuity planning process to ensure rapid recovery, resumption and maintenance of the financial institution's operations after a cyber-attack involving destructive malware.
In 2015, Federal regulators issued two statements regarding cybersecurity: (i) a statement indicating that financial institutions should design multiple layers of security controls to establish lines of defense and to ensure that their risk management processes also address the risk posed by compromised customer credentials, including security measures to reliably authenticate customers accessing internet-based services of the financial institutions; and (ii) a statement indicating the expectation of a financial institution's management to maintain a sufficient business continuity planning process to ensure rapid recovery, resumption and maintenance of the financial institution's operations after a cyber-attack involving destructive malware.
Commercial real estate loans are provided to many of the same customers and carry similar industry and customer specific risks as the commercial and industrial loans, but have different collateral risks.
Commercial real estate loans are provided to many of the same customers and carry similar industry and customer specific risks as the commercial and industrial loans, but 1 have different collateral risks.
Management monitors industry concentrations against internally established risk-based capital thresholds. As of December 31, 2024, City National was within its internally designated concentration limits. Furthermore, with the exception of loans to borrowers within the "Lessors of Nonresidential Buildings" and "Lessors of Residential Buildings and Dwellings" categories, no other NAICS industry classification exceeded 10% of total loans at December 31, 2024.
Management monitors industry concentrations against internally established risk-based capital thresholds. As of December 31, 2025, City National was within its internally designated concentration limits. Furthermore, with the exception of loans to borrowers within the "Lessors of Nonresidential Buildings" and "Lessors of Residential Buildings and Dwellings" categories, no other NAICS industry classification exceeded 10% of total loans at December 31, 2025.
Although no portion of City National’s loan portfolio is concentrated within a single industry or group of related industries in excess of City National's internally designated limit, residential mortgage loans have historically comprised a significant portion of its loan portfolio. At December 31, 2024, approximately 47% of the Company’s loan portfolio was categorized as residential mortgage and home equity loans.
Although no portion of City National’s loan portfolio is concentrated within a single industry or group of related industries in excess of City National's internally designated limit, residential mortgage loans have historically comprised a significant portion of its loan portfolio. At December 31, 2025, approximately 47% of the Company’s loan portfolio was categorized as residential mortgage and home equity loans.
Our average quarterly employee turnover rate in 2024 was under 6%. As of December 31, 2024, approximately 79% of our current workforce is female, 21% is male, our average tenure is approximately 10 years and approximately 14% of our workforce has a college degree. Compensation and Benefits Programs: We provide competitive compensation and benefits programs to our employees.
Our average quarterly employee turnover rate in 2025 was under 6%. As of December 31, 2025, approximately 79% of our current workforce is female, 21% is male, our average tenure is approximately 10 years and approximately 14% of our workforce has a college degree. Compensation and Benefits Programs: We provide competitive compensation and benefits programs to our employees.
The information on the Company’s website is not, and shall not be deemed to be, a part of this report or incorporated into any other filing with the Securities and Exchange Commission. Copies of the Company’s annual report will be made available, free of charge, upon written request. 12
The information on the Company’s website is not, and shall not be deemed to be, a part of this report or incorporated into any other filing with the Securities and Exchange Commission. Copies of the Company’s annual report will be made available, free of charge, upon written request. 13
Loans to "Lessors of Nonresidential Buildings" and "Lessors of Residential Buildings and Dwellings" were 14% and 11% , respectively, of total loans at December 31, 2024. Management also monitors non-owner occupied commercial real estate as a percent of risk-based capital (based upon regulatory guidance).
Loans to "Lessors of Nonresidential Buildings" and "Lessors of Residential Buildings and Dwellings" were 14% and 11% , respectively, of total loans at December 31, 2025. Management also monitors non-owner occupied commercial real estate as a percent of risk-based capital (based upon regulatory guidance).
No dividends were paid in 2024 or 2023 that required regulatory approval. The payment of dividends by the Company and City National may also be limited by other factors, such as requirements to maintain adequate capital above regulatory guidelines.
No dividends were paid in 2025 or 2024 that required regulatory approval. The payment of dividends by the Company and City National may also be limited by other factors, such as requirements to maintain adequate capital above regulatory guidelines.
In addition, banks will have to notify at least one designated point of contact at any affected customer as soon as possible when the bank experiences any computer-security incident that has disrupted or degraded, or is reasonably likely to materially disrupt or degrade, covered services provided to such customer for four or more hours.
In addition, banks must notify at least one designated point of contact at any affected customer as soon as possible when the bank experiences any computer-security incident that has disrupted or degraded, or is reasonably likely to materially disrupt or degrade, covered services provided to such customer for four or more hours.
Market Area and Competition City National operates a network of 97 bank branches primarily along the I-64 corridor from Lexington, Kentucky through Lexington, Virginia and along the I-81 corridor through the Shenandoah Valley from Lexington, Virginia to Martinsburg, West Virginia.
Market Area and Competition City National operates a network of 96 bank branches primarily along the I-64 corridor from Lexington, Kentucky through Lexington, Virginia and along the I-81 corridor through the Shenandoah Valley from Lexington, Virginia to Martinsburg, West Virginia.
In Lawrence County, Ohio, where City National has three bank branches, City National has approximately 19% of the deposit market share. The following table represents changes in population in West Virginia, Kentucky, Virginia, and Ohio counties where City National's branches are located compared to the U.S. national average according to the most recent U.S.
In Lawrence County, Ohio, where City National has three bank branches, City National has approximately 19% of the deposit market share. The following table represents changes in population in West Virginia, Kentucky, Virginia, and Ohio counties where City National's branches are located compared to the U.S. national average according to the most recently available U.S.
In addition to traditional banking organizations, the Company competes with credit unions, finance companies, financial technology "fintech" companies, mutual funds, insurance companies, and other financial service providers, many of which are able to provide specialty financial products and services to targeted customer groups.
In addition to traditional banking organizations, the Company competes with credit unions, finance companies, financial technology "fintech" companies, including decentralized finance and cryptocurrency companies, mutual funds, insurance companies, and other financial service providers, many of which are able to provide specialty financial products and services to targeted customer groups.
However, due to the fractured nature of residential mortgage lending, there is no concentration of credits that would be considered materially detrimental to the Company’s financial position or operating results. At December 31, 2024, approximately 51% of the Company’s loan portfolio was categorized as commercial and industrial and commercial real estate.
However, due to the fractured nature of residential mortgage lending, there is no concentration of credits that would be considered materially detrimental to the Company’s financial position or operating results. At December 31, 2025, approximately 52% of the Company’s loan portfolio was categorized as commercial and industrial and commercial real estate.
At December 31, 2024, the Company had $1.5 billion of commercial loans classified as non-owner occupied, which was within its designated concentration threshold. Residential real estate loans represent loans to consumers that are secured by a first priority lien on residential real property.
At December 31, 2025, the Company had $1.6 billion of commercial loans classified as non-owner occupied, which was within its designated concentration threshold. Residential real estate loans represent loans to consumers that are secured by a first priority lien on residential real property.
Within its markets, the Company competes with national, regional, and local community banks for deposits, credit and trust and investment management customers.
Within its markets, the Company competes with national, regional, and local community banks for deposits, credit and wealth and investment management customers.
Banking regulators also take into account CRA ratings when considering approval of a proposed merger or acquisition transaction. Depository institutions are typically examined for CRA compliance every three years, although the frequency is at the OCC's discretion. City National received a "satisfactory" ra ting on its most recent CRA examination in 2022.
Banking regulators also take into account CRA ratings when considering approval of a proposed merger or acquisition transaction. Depository institutions are typically examined for CRA compliance every three years, although the frequency is at the OCC's discretion. City National received a "Satisfactory" rating on its most recent CRA examination in 2025.
A change in statutes, regulations or regulatory policies applicable to the Company or our subsidiaries could have a material effect on the Company’s business, financial condition and results of operations. 11 Executive Officers of the Registrant At December 31, 2024, the executive officers of the Company were as follows: Name Age Positions Held with Registrant Charles R.
A change in statutes, regulations or regulatory policies applicable to the Company or our subsidiaries could have a material effect on the Company’s business, financial condition and results of operations. 12 Executive Officers of the Registrant At December 31, 2025, the named executive officers of the Company were as follows: Name Age Positions Held with Registrant Charles R.
As of December 31, 2024, City National reported $1.82 billion of loans classified as "Residential Real Estate." City National's home equity loans represent loans to consumers that are secured by a second (or junior) priority lien on residential real property.
As of December 31, 2025, City National reported $1.91 billion of loans classified as "Residential Real Estate." City National's home equity loans represent loans to consumers that are secured by a second (or junior) priority lien on residential real property.
City National's branch network includes 58 branches in West Virginia, 22 branches in Kentucky, 13 branches in Virginia and 4 branches in southeastern Ohio.
City National's branch network includes 58 branches in West Virginia, 22 branches in Kentucky, 13 branches in Virginia and 3 branches in southeastern Ohio.
As of December 31, 2024, City National reported $5.7 million of loans classified as "DDA Overdrafts." City National’s loan underwriting guidelines and standards are updated periodically with suggested revisions presented to City National's Board of Directors for approval.
As of December 31, 2025, City National reported $3.7 million of loans classified as "DDA Overdrafts." City National’s loan underwriting guidelines and standards are updated periodically with suggested revisions presented to City National's Board of Directors for approval.
Michael T. Quinlan, Jr. 56 Executive Vice President of Retail Banking, City Holding Company and City National Bank, since January 2021. Jeffrey D. Legge 60 Executive Vice President, Chief Administration Officer and Chief Information Officer, City Holding Company and City National Bank, since December 2005.
Michael T. Quinlan, Jr. 57 Executive Vice President of Retail Banking, City Holding Company and City National Bank, since January 2021. Jeffrey D. Legge 61 Executive Vice President, Chief Administration Officer and Chief Information Officer, City Holding Company and City National Bank, since December 2005.
City National provides banking, trust and investment management and other financial solutions through its network of 97 bank branches and 941 full-time equivalent associates located in West Virginia, Kentucky, Virginia and southeastern Ohio. The Company’s business activities are currently limited to one reportable business segment, which is community banking.
City National provides banking, wealth and investment management and other financial solutions through its network of 96 bank branches and 934 full-time equivalent associates located in West Virginia, Kentucky, Virginia and southeastern Ohio. The Company’s business activities are currently limited to one reportable business segment, which is community banking.
Risk characteristics are driven by rental housing demand as well as economic and employment conditions. These properties exhibit greater risk than multi-family properties due to fewer income sources. • The Hotel portfolio is comprised of all lodging establishments and totaled $389.7 million as of December 31, 2024.
Risk characteristics are driven by rental housing demand as well as economic and employment conditions. These properties exhibit greater risk than multi-family properties due to fewer income sources. • The Hotel portfolio is comprised of all lodging establishments and totaled $398.6 million as of December 31, 2025.
As of December 31, 2024, City National reported $420 million of loans classified as "Commercial and Industrial". Commercial real estate loans consist of commercial mortgages, which generally are secured by nonresidential and multi-family residential properties, including hotel/motel and apartment lending.
As of December 31, 2025, City National reported $454.0 million of loans classified as "Commercial and Industrial". Commercial real estate loans consist of commercial mortgages, which generally are secured by nonresidential and multi-family residential properties, including hotel/motel and apartment lending.
Specifically, the approval of the OCC is required prior to the payment of dividends by City National in excess of its earnings retained in the current year plus retained net profits for the preceding two years. At December 31, 2024, City National could pay dividends up to $48.2 million without prior regulatory permission.
Specifically, the approval of the OCC is required prior to the payment of dividends by City National in excess of its earnings retained in the current year plus retained net profits for the preceding two years. At December 31, 2025, City National could pay dividends up to $43.7 million without prior regulatory permission.
As of December 31, 2024, City National reported $1.77 billion of loans classified as "Commercial Real Estate." 1 In order to group loans with similar risk characteristics, the portfolio is further segmented by product types: • Commercial 1-4 Family loans consist of residential single-family, duplex, triplex, and fourplex rental properties and totaled $197.3 million as of December 31, 2024.
As of December 31, 2025, City National reported $1.87 billion of loans classified as "Commercial Real Estate." In order to group loans with similar risk characteristics, the portfolio is further segmented by product types: • Commercial 1-4 Family loans consist of residential single-family, duplex, triplex, and fourplex rental properties and totaled $210.2 million as of December 31, 2025.
As of December 31, 2024, City National reported $199.2 million of loans classified as "Home Equity." All mortgage loans, whether fixed rate or adjustable rate, are originated in accordance with acceptable industry standards and comply with regulatory requirements.
As of December 31, 2025, City National reported $224.7 million of loans classified as "Home Equity." All mortgage loans, whether fixed rate or adjustable rate, are originated in accordance with acceptable industry standards and comply with regulatory requirements.
Hageboeck, Ph.D. 62 President and Chief Executive Officer, City Holding Company and City National Bank, since February 1, 2005. John A. DeRito 74 Executive Vice President of Commercial Banking, City Holding Company and City National Bank, since June 2004. David L. Bumgarner 59 Executive Vice President and Chief Financial Officer, City Holding Company and City National Bank, since February 2005.
Hageboeck, Ph.D. 63 President and Chief Executive Officer, City Holding Company and City National Bank, since February 1, 2005. John A. DeRito 75 Executive Vice President of Commercial Banking, City Holding Company and City National Bank, since June 2004. David L. Bumgarner 60 Executive Vice President and Chief Financial Officer, City Holding Company and City National Bank, since February 2005.
Our success is a testament to the quality of financial products and services we provide, but more importantly, to our team and our culture. Employee Demographics: As of December 31, 2024, we employed 963 full and part-time employees (941 FTEs) across our 97 branches throughout West Virginia, Kentucky, Virginia and southeastern Ohio.
Our success is a testament to the quality of financial products and services we provide, but more importantly, to our team and our culture. Employee Demographics: As of December 31, 2025, we employed 950 full and part-time employees (934 FTEs) across our 96 branches throughout West Virginia, Kentucky, Virginia and southeastern Ohio.
Risk characteristics relate to the demand for business and personal travel. • Multi-family consists of 5 or more family residential apartment lending. The portfolio totaled $240.9 million as of December 31, 2024.
Risk characteristics relate to the demand for business and personal travel. • Multi-family consists of 5 or more family residential apartment lending. The portfolio totaled $237.4 million as of December 31, 2025.
As of December 31, 2024, City National reported $57.8 million of loans classified as "Consumer." DDA overdraft balances reflect demand deposit accounts that have been overdrawn by deposit customers and have been reclassified as loans.
As of December 31, 2025, City National reported $47.4 million of loans classified as "Consumer." DDA overdraft balances reflect demand deposit accounts that have been overdrawn by deposit customers and have been reclassified as loans.
The Federal Reserve Board has stated that, as a matter of prudent banking, a bank or bank holding company should not maintain its existing rate of cash dividends on common stock unless (1) the organization’s net income available to common shareholders over the past year has been sufficient to fully fund the dividends and (2) the prospective rate of earnings retention appears consistent with the organization’s capital needs, asset quality, and overall financial condition.
Depending upon the financial condition of City National, the payment of dividends could be deemed to constitute such an unsafe or unsound practice.The Federal Reserve Board has stated that, as a matter of prudent banking, a bank or bank holding company should not maintain its existing rate of cash dividends on common stock unless (1) the organization’s net income available to common shareholders over the past year has been sufficient to fully fund the dividends and (2) the prospective rate of earnings retention appears consistent with the organization’s capital needs, asset quality, and overall financial condition.
National Average 334,914.9 331,449.3 1.0 Human Capital We care about our employees and provide not only competitive compensation and benefit packages, but a work environment our employees characterize as "family." We are committed to integrity and the highest ethical standards in regard to how we treat both our customers and our employees.
National Average 340,111.0 331,515.7 2.6 Human Capital We care about our employees and provide not only competitive compensation and benefit packages, but a work environment our employees characterize as "family." We are committed to integrity and the highest ethical standards in regard to how we treat both our customers and our employees.
The Company's SEC filings are also available to the public at the SEC's website at www.sec.gov. The Company’s Internet website address is www.bankatcity.com.
The Company's SEC filings are also available to the public at the SEC's website at www.sec.gov by searching our ticker symbol "CHCO". The Company’s Internet website address is www.bankatcity.com.
Nonresidential non-owner occupied commercial real estate totaled $707.3 million while nonresidential owner-occupied commercial real estate totaled $233.5 million as of December 31, 2024. Risk characteristics relate to levels of consumer spending and overall economic conditions.
Nonresidential non-owner occupied commercial real estate totaled $767.6 million while nonresidential owner-occupied commercial real estate totaled $253.4 million as of December 31, 2025. Risk characteristics relate to levels of consumer spending and overall economic conditions.
Census Bureau estimates (in thousands): 2023 (Estimate) 2020 (Actual) Change % West Virginia 996.6 1,000.6 (0.4) % Kentucky 1,408.3 1,420.5 (0.9) Virginia 237.4 230.8 2.9 Lawrence County, Ohio 56.1 58.2 (3.6) U.S.
Census Bureau estimates (in thousands): 2024 (Estimate) 2020 (Actual) Change % West Virginia 999.5 1,000.5 (0.1) % Kentucky 1,440.9 1,420.5 1.4 Virginia 241.0 230.8 4.4 Lawrence County, Ohio 55.8 58.2 (4.1) U.S.
The CFPB has also promulgated rules under the Equal Credit Opportunity Act, the Truth in Lending Act, and the Real Estate Settlement Procedures Act, all of which impact the Company's loan origination and servicing operations. The CFPB also has broad authority to supervise unfair, deceptive or abusive acts or practices related to banking.
The CFPB has also promulgated rules under the Equal Credit Opportunity Act, the Truth in Lending Act, and the Real Estate Settlement Procedures Act, all of which impact the Company's loan origination and servicing operations.
The increased expense was due to a final rule adopted by the FDIC in October 2022 that increased the initial base deposit insurance assessment rate schedules uniformly by 2 basis points beginning with the first quarterly assessment period of 2023.
In October 2022, the adopted a final rule that increased the initial base deposit insurance assessment rate schedules uniformly by 2 basis points beginning with the first quarterly assessment period of 2023. The Company's FDIC insurance expense for deposit assessments for the past three years is shown in the table below (in thousands).
These statutes and regulations impose specific limits on the amount of loans City National may make to directors and other insiders, and specify approval procedures that must be followed in making loans that exceed certain amounts. 6 The Community Reinvestment Act of 1977 ("CRA") requires depository institutions to assist in meeting the credit needs of their market areas consistent with safe and sound banking practice.
These statutes and regulations impose 6 specific limits on the amount of loans City National may make to directors and other insiders, and specify approval procedures that must be followed in making loans that exceed certain amounts.
The OCC also has the authority to prohibit any bank under its jurisdiction from engaging in an unsafe or unsound practice in conducting its business. Depending upon the financial condition of City National, the payment of dividends could be deemed to constitute such an unsafe or unsound practice.
The OCC also has the authority to prohibit any bank under its jurisdiction from engaging in an unsafe or unsound practice in conducting its business.
Under the CRA, each depository institution is required to help meet the credit needs of its market areas by, among other things, providing credit to low- and moderate-income individuals and communities. Depository institutions are periodically examined for compliance with the CRA and are assigned ratings.
The Community Reinvestment Act of 1977 ("CRA") requires depository institutions to assist in meeting the credit needs of their market areas consistent with safe and sound banking practice. Under the CRA, each depository institution is required to help meet the credit needs of its market areas by, among other things, providing credit to low- and moderate-income individuals and communities.
The National Bank Act generally requires each national bank to maintain reserves against deposits, restricts the nature and amount of loans that the bank may make and the interest the bank may charge on such loans, and restricts investments and other activities of the bank. 5 There are no anticipated material capital expenditures, or any expected material effects on earnings or the Company’s competitive position as a result of compliance with federal, state and local provisions enacted or adopted relating to environmental protection.
There are no anticipated material capital expenditures, or any expected material effects on earnings or the Company’s competitive position as a result of compliance with federal, state and local provisions enacted or adopted relating to environmental protection.
At December 31, 2024, the outstanding balance of commercial loans to markets outside of the geographical footprint of the bank's branches was approximately $420 million, or 19% of City National's outstanding commercial loan balances. City National has approximately 13% of the deposit market share in the counties of West Virginia where its bank branches are located.
At December 31, 2025, the outstanding balance of commercial loans to markets outside of the geographical footprint of the bank's branches was approximately $807 million, or 35% of City National's outstanding commercial loan balances as compared to $420 million, or 19%, as of December 31, 2024.
For the year ended December 31, 2024, the Company's FDIC insurance expense remained stable at $2.9 million. 10 Under the Federal Deposit Insurance Act, as amended ("FDIA") the FDIC may terminate deposit insurance upon finding that an institution has engaged in unsafe or unsound practices, is in unsafe or unsound condition to continue operations, or has violated any applicable law, regulation, rule, order or condition imposed by the FDIC.
For the year ended December 31, 2025 2024 2023 FDIC insurance expense $ 3,049 $ 2,892 $ 2,922 Under the Federal Deposit Insurance Act, as amended ("FDIA") the FDIC may terminate deposit insurance upon finding that an institution has engaged in unsafe or unsound practices, is in unsafe or unsound condition to continue operations, or has violated any applicable law, regulation, rule, order or condition imposed by the FDIC. 10 Cybersecurity In April 2005, federal regulators issued guidance requiring financial institutions to develop and implement a response program designed to address incidents of unauthorized access to sensitive customer information maintained by the financial institution or its service provider.
The bank and holding company are required to determine whether an incident arises to the level of requiring notification. See Item 1C for further discussion related to the Company's risk management, strategy, and governance of cybersecurity.
The Company is required to determine whether an incident arises to the level of requiring notification.
Removed
The Federal Reserve Board and the OCC have indicated their view that it generally would be an unsafe and unsound practice to pay dividends except out of current operating earnings.
Added
The increase from the prior year is primarily due to branch closure in Columbus, Ohio during 2025. City National has approximately 13% of the deposit market share in the counties of West Virginia where its bank branches are located.
Removed
The Company's FDIC insurance expense for deposit assessments for the past three years is shown in the table below (in thousands).
Added
The National Bank Act generally 5 requires each national bank to maintain reserves against deposits, restricts the nature and amount of loans that the bank may make and the interest the bank may charge on such loans, and restricts investments and other activities of the bank.
Removed
For the year ended December 31, 2024 2023 2022 FDIC insurance expense $ 2,892 $ 2,922 $ 1,673 The Company's FDIC insurance expense increased $1.2 million from the year ended December 31, 2022 to the year ended December 31, 2023.
Added
Depository institutions are periodically examined for compliance with the CRA and are assigned ratings.
Added
The guidance requires several elements to be included in an institution’s response program including notifications to an institution’s primary federal regulator as soon as possible when the institution becomes aware of an incident involving unauthorized access to or use of sensitive customer information; and notification to its customers when, after a reasonable investigation, the financial institution determines that misuse of the information has occurred or it is reasonably possible that misuse will occur.
Added
State regulators have also been increasingly active in implementing data privacy and cybersecurity standards and regulations. Recently, several states have adopted regulations requiring certain financial institutions to implement cybersecurity programs and providing detailed requirements with respect to these programs, including data encryption requirements. Many states have also recently implemented or modified their data breach notification and data privacy requirements.
Added
Many, but not all, state breach notification laws expressly exempt entities that are subject to federal regulatory breach notification mandates. The Company continues to monitor developments in the states in which its customers are located.
Added
The Cybersecurity Information Sharing Act (“CISA”) is intended to improve cybersecurity in the U.S. by enhanced sharing of information about security threats among the U.S. government and private sector entities, including financial institutions, and empowers the Cybersecurity and Infrastructure Security Agency (“CISA Agency”) to oversee this information-sharing process.
Added
The CISA also authorizes companies to monitor their own systems notwithstanding any other provision of law and allows companies to carry out defensive measures on their own systems from cyber-attacks or other information or security breaches.
Added
The law includes liability protections for companies that share cyber-threat information with third parties so long as such sharing activity is conducted in accordance with the CISA.
Added
Although the CISA originally expired on September 30, 2025 and was temporarily reauthorized to remain in effect through September 30, 2026, the long-term status of the CISA remains uncertain pending further action by the U.S. Congress.
Added
In addition, the enactment of the Cyber Incident Reporting for Critical Infrastructure Act (“CIRCIA”) in 2022, once rulemaking is complete, will require, among other things, certain companies to report significant cyber incidents to the CISA Agency within 72 hours from the time the company reasonably believes the incident occurred (and within 24 hours of making a ransom payment as a result of a ransomware attack).
Added
On April 4, 2024, the CISA Agency proposed a rule under the CIRCIA that would clarify the scope of cyber incidents to be reported and would further define covered entities subject to the CIRCIA to expressly include companies in the financial services industry that are required to report cyber incidents to their primary federal regulators.
Added
Final rulemaking for CIRCIA has been extended to May 2026. On July 26, 2023, the SEC adopted final rules that require public companies to promptly disclose material cybersecurity incidents in a Current Report on Form 8-K and detailed information regarding their cybersecurity risk management, strategy, and governance on an annual basis in its Annual Reports on Form 10-K.
Added
Companies are required to report on Form 8-K any cybersecurity incident they determine to be material within four business days of making that determination.
Added
These SEC rules, and any other regulatory guidance, are in addition to notification and disclosure requirements under state and federal banking law and regulations. 11 See Item 1C for further discussion related to the Company's risk management, strategy, and governance of cybersecurity.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese claims and legal actions, including supervisory actions by its regulators, could involve large monetary claims and cause the Company to incur significant defense expenses. As a result, the Company may be exposed to substantial liabilities, which could negatively affect its shareholders’ equity and financial results. The Company Faces Reputational Risk.
Biggest changeSignificant Legal Actions Could Result in Substantial Liabilities. From time to time, the Company is subject to claims related to its operations. These claims and legal actions, including supervisory actions by its regulators, could involve large monetary claims and cause the Company to incur significant defense expenses.
Climate change presents multi-faceted risks, including: operational risk from the physical effects of climate events on the Company and its customers’ facilities and other assets; credit risk from borrowers with significant exposure to climate risk; transition risks associated with the transition to a less carbon-dependent economy; and reputational risk from stakeholder concerns about the Company’s practices related to climate change, the Company’s carbon footprint, and the Company’s business relationships with clients who operate in carbon-intensive industries.
Climate change presents multi-faceted risks, including: operational risk from the physical effects of climate events on the Company and its customers’ facilities and other assets; credit risk from borrowers with significant exposure to climate risk; transition risks associated with the transition to a less carbon-dependent economy; 23 and reputational risk from stakeholder concerns about the Company’s practices related to climate change, the Company’s carbon footprint, and the Company’s business relationships with clients who operate in carbon-intensive industries.
The Company’s ability to compete successfully depends on a number of factors, including our ability to develop, maintain, and build long-term customer relationships; our ability to expand our market area and range of services and products offered; our ability to keep up-to-date with technological advancements, both with respect to new and existing products and with respect to cybersecurity; customer satisfaction with our products and services; and general industry and economic trends.
The Company’s ability to compete successfully depends on a number of factors, including our ability to develop, maintain, and build long-term customer relationships; our ability to expand our market area and range of services and products offered; our ability to keep up-to-date with technological advancements, both with respect to new and existing products and with respect to cybersecurity; customer satisfaction with our products and services; and general industry and 17 economic trends.
The Company’s business needs and future growth, including future acquisitions or organic growth into new markets and business lines, may require it to raise additional capital. 17 One of the Company’s main sources for liquidity is customer deposits. Increased competition and the availability of alternative products may reduce the Company’s ability to attract and retain core deposits.
The Company’s business needs and future growth, including future acquisitions or organic growth into new markets and business lines, may require it to raise additional capital. One of the Company’s main sources for liquidity is customer deposits. Increased competition and the availability of alternative products may reduce the Company’s ability to attract and retain core deposits.
The Company's business is highly dependent on third-party vendors, especially with respect to information technology and telecommunication systems, payment processing system, and mobile and online banking systems. Our operations rely heavily on the secure processing, storage, transmission, and monitoring of information and transactions, and many of these services are outsourced to third-party vendors.
The Company's business is highly dependent on third-party vendors, especially with respect to information technology and telecommunication systems, payment processing system, and mobile and online banking systems. Our operations rely heavily on the secure processing, storage, transmission, and monitoring of information and transactions, and 19 many of these services are outsourced to third-party vendors.
In developing and marketing new lines of business and/or products and services, the Company may invest significant time and resources. External factors, such as compliance with regulations, competitive 16 alternatives, and shifting market preferences, may also impact the successful implementation of a new line of business or a new product or service.
In developing and marketing new lines of business and/or products and services, the Company may invest significant time and resources. External factors, such as compliance with regulations, competitive alternatives, and shifting market preferences, may also impact the successful implementation of a new line of business or a new product or service.
Negative publicity may arise regarding the Company’s business, employees, or customers, with or without merit, and could 20 result in the loss of customers, investors and employees, costly litigation, a decline in revenue, and increased regulatory oversight. The Company Is Subject to Possible Claims and Litigation Relating to Fiduciary Activities.
Negative publicity may arise regarding the Company’s business, employees, or customers, with or without merit, and could result in the loss of customers, investors and employees, costly litigation, a decline in revenue, and increased regulatory oversight. The Company Is Subject to Possible Claims and Litigation Relating to Fiduciary Activities.
The Company’s ability to attract and retain talented employees may be affected by these restrictions, or any new executive compensation limits or regulations. Risks Related to Legal, Reputational and Compliance Matters Certain Banking Laws May Have an Anti–Takeover Effect.
The Company’s ability to attract and retain talented employees may be affected by these restrictions, or any new executive compensation limits or regulations. 20 Risks Related to Legal, Reputational and Compliance Matters Certain Banking Laws May Have an Anti–Takeover Effect.
In addition, the Company’s credit risk may be exacerbated when the collateral held by 18 the Company cannot be realized upon or is liquidated at prices not sufficient to recover the full amount of the credit or derivative exposure due to the Company.
In addition, the Company’s credit risk may be exacerbated when the collateral held by the Company cannot be realized upon or is liquidated at prices not sufficient to recover the full amount of the credit or derivative exposure due to the Company.
Although the Board of Directors has declared cash dividends in the past, the Company's current ability to pay dividends is largely dependent upon the receipt of dividends from City National. Federal laws impose restrictions on the 19 ability of City National to pay dividends.
Although the Board of Directors has declared cash dividends in the past, the Company's current ability to pay dividends is largely dependent upon the receipt of dividends from City National. Federal laws impose restrictions on the ability of City National to pay dividends.
Given the lower trading volume of the Company’s common stock, significant sales of the Company’s common stock, or the expectation of these sales, could cause the Company’s stock price to fall. 15 Future Sales or the Issuance of Shares of the Company’s Common Stock Could Negatively Affect its Market Price.
Given the lower trading volume of the Company’s common stock, significant sales of the Company’s common stock, or the expectation of these sales, could cause the Company’s stock price to fall. Future Sales or the Issuance of Shares of the Company’s Common Stock Could Negatively Affect its Market Price.
If the value of the 13 real estate serving as collateral for the Company's loan portfolio were to decline materially, a significant part of the Company's loan portfolio could become under-collateralized.
If the value of the real estate serving as collateral for the Company's loan portfolio were to decline materially, a significant part of the Company's loan portfolio could become under-collateralized.
Neither the FDIC nor any other governmental agency insures the shares of the Company’s common stock. Therefore, the value of common stock of the Company will be based on market value and may decline. Strategic Risks Due to Increased Competition, the Company May Not be Able to Attract and Retain Banking Customers.
Neither the FDIC nor any other governmental agency insures the shares of the Company’s common stock. Therefore, the value of common stock of the Company will be based on market value and may fluctuate. Strategic Risks Due to Increased Competition, the Company May Not be Able to Attract and Retain Banking Customers.
In addition, an economic transition to mitigate climate change on a broader scale could have a negative or destabilizing impact on the general economic conditions of the country, which could also have a negative impact on the financial outcomes of the Company. 22 Item 1B. Unresolved Staff Comments None.
In addition, an economic transition to mitigate climate change on a broader scale could have a negative or destabilizing impact on the general economic conditions of the country, which could also have a negative impact on the financial outcomes of the Company. 24 Item 1B. Unresolved Staff Comments None.
The Trading Volume in the Company’s Common Stock Is Less Than That of Other Larger Financial Services Companies. Although the Company’s common stock is listed for trading on the NASDAQ Global Select Market, the trading volume in its common stock is less than that of other financial services companies.
Although the Company’s common stock is listed for trading on the NASDAQ Global Select Market, the trading volume in its common stock is less than that of some other financial services companies.
The Company recently completed such an impairment analysis and concluded that no impairment charge was necessary for the year ended December 31, 2024. The Company cannot provide assurance whether it will be required to take an impairment charge in the future.
The Company recently completed such an impairment analysis and concluded that no impairment charge was necessary for the year ended December 31, 2025. The Company cannot provide 18 assurance whether it will be required to take an impairment charge in the future.
At December 31, 2024, the Company’s goodwill and other identifiable intangible assets were approximately $160 million. Under current accounting standards, if the Company determines goodwill or intangible assets are impaired, it would be required to write down the value of these assets. The Company conducts an annual review to determine whether goodwill and other identifiable intangible assets are impaired.
At December 31, 2025, the Company’s goodwill and other identifiable intangible assets were approximately $158 million. Under current accounting standards, if the Company determines goodwill or intangible assets are impaired, it would be required to write down the value of these assets. The Company conducts an annual review to determine whether goodwill and other identifiable intangible assets are impaired.
A significant portion of the business conducted in the Company's trust division involves the Company assuming the special role of a fiduciary to its customers and to the beneficiaries of its customers' assets. Customers or beneficiaries could make claims and take legal action relating to the Company’s fiduciary activities.
A significant portion of the business conducted in the Company's wealth and investment management division involves the Company assuming the special role of a fiduciary to its customers and to the beneficiaries of its customers' assets. Customers or beneficiaries could make claims and take legal action relating to the Company’s fiduciary activities.
Additionally, the coal industry continues to be in decline as a result of increased environmental and safety regulatory burden, increased competition from alternative energy sources and a decline in demand for coal. The Company has limited direct exposure to coal industry specific loans.
Additionally, the coal industry has historically been in decline as a result of increased environmental and safety regulatory burden, increased competition from alternative energy sources and a decline in demand for coal. The Company has limited direct exposure to coal industry specific loans.
The techniques used by cyber criminals change frequently, may not be recognized until launched, and can originate from a wide variety of sources, including outside groups such as external service providers, organized crime affiliates, terrorist organizations or hostile foreign governments.
Persistent attackers may succeed in penetrating defenses given enough resources, time and motive. The techniques used by cyber criminals change frequently, may not be recognized until launched, and can originate from a wide variety of sources, including outside groups such as external service providers, organized crime affiliates, terrorist organizations or hostile foreign governments.
Prolonged low oil and gas prices, and continued decline in the coal industry, could result in downward pressure on businesses in the Company’s market area which could negatively affect City National’s customers (both individuals and businesses). As a result, the Company’s operating results and financial condition could be negatively impacted.
Prolonged low oil and gas prices, and continued decline in the coal industry, could result in downward pressure on businesses in the Company’s market area which could negatively affect City National’s customers (both individuals and businesses).
An economic slowdown could have the following consequences: • Loan delinquencies may increase; • Problem assets and foreclosures may increase; • Demand for City National's products and services may decline; and • Collateral (including real estate) that secures loans made by City National may decline in value, in turn reducing customers’ borrowing power and making existing loans less secure.
An economic slowdown, or an increase in joblessness, whether caused by general economic conditions or the rise of alternative technologies replacing members of the workforce, could have the following consequences: • Loan delinquencies may increase; • Problem assets and foreclosures may increase; • Demand for City National's products and services may decline; and • Collateral (including real estate) that secures loans made by City National may decline in value, in turn reducing customers’ borrowing power and making existing loans less secure.
Changes in interest rates may also negatively affect the ability of the Company's borrowers to repay their loans, particularly as interest rates rise and adjustable-rate loans become more expensive. 14 Although management believes it has implemented effective asset and liability management strategies, including the use of derivatives as hedging instruments, to reduce the potential effects of changes in interest rates on the Company’s results of operations, any substantial, unexpected, prolonged change in market interest rates could have a material adverse effect on the Company’s financial condition and results of operations.
Although management believes it has implemented effective asset and liability management strategies, including the use of derivatives as hedging instruments, to reduce the potential effects of changes in interest rates on the Company’s results of operations, any substantial, unexpected, prolonged change in market interest rates could have a material adverse effect on the Company’s financial condition and results of operations.
The Company could incur substantial costs and suffer other negative consequences, including: remediation costs, such as liability for stolen assets or information, repairs of system damage, and incentives to customers in an effort to maintain relationships after an attack; increased cybersecurity protection costs, such as organizational changes, deploying additional personnel and protection technologies, training employees, and engaging third-party experts and consultants; and damage to the Company's competitiveness, stock price, and long-term shareholder values.
The Company could incur substantial costs and suffer other negative consequences, including: remediation costs, such as liability for stolen assets or information, repairs of system damage, and incentives to customers in an effort to maintain relationships after an attack; increased cybersecurity protection costs, such as organizational changes, deploying additional personnel and protection technologies, training employees, and engaging third-party experts and consultants; and damage to the Company's competitiveness, stock price, and long-term shareholder values. 22 Despite efforts to ensure the integrity of the Company's systems, the Company will not be able to anticipate all security breaches of these types, nor will it be able to implement guaranteed preventive measures against such security breaches.
The Company’s future success depends on its ability to address the needs and preferences of its customers by using technology to provide products and services that enhance customer convenience and that create additional efficiencies in the Company’s operations.
The banking and financial services industry continually undergoes technological change, with frequent introductions of new technology-driven products and services. The Company’s future success depends on its ability to address the needs and preferences of its customers by using technology to provide products and services that enhance customer convenience and that create additional efficiencies in the Company’s operations.
Credit and Interest Rate Risks The Value of Real Estate Collateral May Fluctuate Significantly Resulting in an Under-Collateralized Loan Portfolio. The market value of real estate, particularly real estate held for investment, can fluctuate significantly in a short period of time as a result of market conditions in the geographic area in which the real estate is located.
The market value of real estate, particularly real estate held for investment, can fluctuate significantly in a short period of time as a result of market conditions in the geographic area in which the real estate is located.
A successful security breach could result in violations of applicable privacy and other laws, financial loss to the Company or to its customers, loss of confidence in its security measures, significant litigation exposure, and harm to its reputation, all of which could have a material adverse effect on the Company. 21 Criminals are committing fraud at an increasing rate and are using more sophisticated techniques, including the use of artificial intelligence technologies.
A successful security breach could result in violations of applicable privacy and other laws, financial loss to the Company or to its customers, loss of confidence in its security measures, significant litigation exposure, and harm to its reputation, all of which could have a material adverse effect on the Company.
Furthermore, the stock market in general, and the market for financial institutions in particular, have experienced extreme volatility that often has been unrelated to the operating performance of particular companies. These broad market and industry fluctuations may adversely affect the trading price of the Company’s common stock, regardless of actual operating performance.
Furthermore, the stock market in general, and the market for financial institutions in particular, have experienced extreme volatility that often has been unrelated to the operating performance of particular companies.
Any system of controls, no matter how well designed and operated, is based in part on certain assumptions and can provide only reasonable, not absolute, assurances that the objectives of the system are met. Significant Legal Actions Could Result in Substantial Liabilities. From time to time, the Company is subject to claims related to its operations.
Any system of controls, no matter how well designed and operated, is based in part on certain assumptions and can provide only reasonable, not absolute, assurances that the objectives of the system are met. 21 The Company Faces Reputational Risk.
Interest rates are highly sensitive to many factors that are beyond the Company’s control, including general economic conditions and policies of various governmental and regulatory agencies and, in particular, the Board of Governors of the Federal Reserve System.
Net interest income is the difference between interest income earned on interest-earning assets, such as loans and securities, and interest expense paid on interest-bearing liabilities, such as deposits and borrowed funds. 15 Interest rates are highly sensitive to many factors that are beyond the Company’s control, including general economic conditions and policies of various governmental and regulatory agencies and, in particular, the Board of Governors of the Federal Reserve System.
Earnings also could be adversely affected if the interest rates received on loans and other investments fall more quickly than the interest rates paid on deposits and other borrowings.
Earnings also could be adversely affected if the interest rates received on loans and other investments fall more quickly than the interest rates paid on deposits and other borrowings. Changes in interest rates may also negatively affect the ability of the Company's borrowers to repay their loans, particularly as interest rates rise and adjustable-rate loans become more expensive.
Changes in Tax Law and Accounting Standards Could Materially Affect the Company's Operations. Changes in tax laws, or changes in the interpretation of existing tax laws, could materially adversely affect the Company’s operations.
As a result, the Company may be exposed to substantial liabilities, which could negatively affect its shareholders’ equity and financial results. Changes in Tax Law and Accounting Standards Could Materially Affect the Company's Operations. Changes in tax laws, or changes in the interpretation of existing tax laws, could materially adversely affect the Company’s operations.
Collection efforts may or may not be successful causing the Company to write off the loan or repossess the collateral securing the loan, which may or may not exceed the balance of the loan. Remediation Costs for Real Property Could Impact the Financial Outcomes of the Company. A significant portion of the Company’s loan portfolio is secured by real property.
To the extent the Company’s customers are impacted by these conditions, the default rate could accelerate. Remediation Costs for Real Property Could Impact the Financial Outcomes of the Company. A significant portion of the Company’s loan portfolio is secured by real property.
The Company’s earnings and cash flows are largely dependent upon its net interest income. Net interest income is the difference between interest income earned on interest-earning assets, such as loans and securities, and interest expense paid on interest-bearing liabilities, such as deposits and borrowed funds.
The Company’s earnings and cash flows are largely dependent upon its net interest income.
The loss of these revenue streams and the lower cost of deposits as a source of funds could have a material adverse effect on our financial condition and results of operations. The banking and financial services industry continually undergoes technological change, with frequent introductions of new technology-driven products and services.
The loss of these revenue streams and lower cost of deposits as a source of funds could have a material adverse effect on our financial condition and results of operations. Furthermore, some of the Company's non-bank competitors are not subject to the same regulations that the Company is and, therefore, may have greater flexibility in competing for business.
Removed
Despite efforts to ensure the integrity of the Company's systems, the Company will not be able to anticipate all security breaches of these types, nor will it be able to implement guaranteed preventive measures against such security breaches. Persistent attackers may succeed in penetrating defenses given enough resources, time and motive.
Added
As a result, the Company’s operating results and financial condition could be negatively impacted. 14 Credit and Interest Rate Risks The Value of Real Estate Collateral May Fluctuate Significantly Resulting in an Under-Collateralized Loan Portfolio.
Added
Collection efforts may or may not be successful causing the Company to write off the loan or repossess the collateral securing the loan, which may or may not exceed the balance of the loan. The Company may experience fluctuations in its default rate driven by general economic conditions, or by increases in technology that lead to cross-industry, widespread job displacement.
Added
The existing Chair of the Federal Reserve’s term ends on May 15, 2026. There is increased uncertainty in what approach to interest rates the Board of Governors will take while led by a new Chair later in 2026.
Added
These broad market and industry fluctuations may adversely affect the trading price of the Company’s common stock, regardless of actual operating performance. 16 The Trading Volume in the Company’s Common Stock Is Less Than That of Other Larger Financial Services Companies.
Added
In addition, the emergence, adoption, and evolution of new technologies that do not require intermediation, including distributed ledgers such as digital assets and blockchain, as well as advances in automation, artificial intelligence, and robotics, could significantly affect the competition for financial services.
Added
Criminals are committing fraud at an increasing rate and are using more sophisticated techniques, including the use of artificial intelligence technologies.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe Information Security Officer and Chief Information Officer are assigned as the Incident Response Team leaders 23 and reports summaries of key issues, including significant cybersecurity and/or privacy incidents to Incident Response Team which includes the Chief Executive Officer. If appropriate, the Chief Executive Officer will communicate the actions taken to our board of directors.
Biggest changeThe Information Security Officer and Chief Information Officer are assigned as the Incident Response Team leaders 25 and reports summaries of key issues, including significant cybersecurity and/or privacy incidents to Incident Response Team which includes the Chief Executive Officer. If appropriate, the Chief Executive Officer will communicate the actions taken to our board of directors.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAll of the properties are suitable and adequate for their current operations. City National also operates a loan production office leased in Cincinnati, Ohio. The Company also owns parcels of real estate for potential future branch development.
Biggest changeAll of the properties are suitable and adequate for their current operations. City National also operates two loan production offices, one leased in Cincinnati, Ohio and one owned in Columbus, Ohio. The Company also owns parcels of real estate for potential future branch development.
Item 2. Properties City National owns the Company’s executive office, located at 25 Gatewater Road, Charleston, West Virginia. This facility has approximately 60,000 square feet and houses the Company's executive and administrative personnel. As of December 31, 2024, City National owns eighty bank branch locations and leases seventeen bank branch locations, pursuant to operating leases.
Item 2. Properties City National owns the Company’s executive office, located at 25 Gatewater Road, Charleston, West Virginia. This facility has approximately 60,000 square feet and houses the Company's executive and administrative personnel. As of December 31, 2025, City National owns seventy-nine bank branch locations and leases seventeen bank branch locations, pursuant to operating leases.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThere can be no assurance that current actions will have immaterial results, either positive or negative, or that no material actions may be presented in the future. Item 4. Mine Safety Disclosures None. 24 PART II
Biggest changeThere can be no assurance that current actions will have immaterial results, either positive or negative, or that no material actions may be presented in the future. As of December 31, 2025, management expects the resolution of current legal actions will not have a material impact on the Company's financial statements. Item 4. Mine Safety Disclosures None. 26 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeAt December 31, 2024, City National could pay $48.2 million in dividends to the Company without prior regulatory permission. 25 Stock Performance The following graph sets forth the cumulative total shareholder return (assuming reinvestment of dividends) to the Company’s shareholders during the five-year period ended December 31, 2024, as well as the NASDAQ Composite Index and the KBW NASDAQ Bank Index. 2019 2020 2021 2022 2023 2024 City Holding Company $100.00 $87.83 $106.52 $124.92 $152.34 $168.20 NASDAQ Composite Index $100.00 $144.92 $177.06 $119.45 $172.77 $223.87 KBW Nasdaq Bank Index $100.00 $89.69 $124.06 $97.52 $96.65 $132.60 This graph shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, unless the Company specifically incorporates this report by reference.
Biggest changeAt December 31, 2025, City National could pay $43.7 million in dividends to the Company without prior regulatory permission. 27 Stock Performance The following graph sets forth the cumulative total shareholder return (assuming reinvestment of dividends) to the Company’s shareholders during the five-year period ended December 31, 2025, as well as the NASDAQ Composite Index and the KBW NASDAQ Bank Index. 2020 2021 2022 2023 2024 2025 City Holding Company $100.00 $121.28 $142.24 $173.43 $191.51 $197.99 NASDAQ Composite Index $100.00 $122.18 $82.43 $119.22 $154.48 $187.14 KBW Nasdaq Bank Index $100.00 $138.33 $108.73 $107.76 $147.85 $196.00 This graph shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, unless the Company specifically incorporates this report by reference.
This table sets forth the cash dividends declared per share and information regarding the closing market prices per share of the Company’s common stock for the periods indicated. The price ranges are based on transactions as reported on the NASDAQ Global Select Market. At February 24, 2025, there were 2,438 shareholders of record.
This table sets forth the cash dividends declared per share and information regarding the closing market prices per share of the Company’s common stock for the periods indicated. The price ranges are based on transactions as reported on the NASDAQ Global Select Market. At February 23, 2026, there were 2,377 shareholders of record.
No time limit was placed on the duration of the share repurchase program. As part of this authorization, the Company terminated its previous repurchase program that was approved in May 2022. There were no common stock repurchases during the quarter ended December 31, 2024. Item 6. Reserved 27
No time limit was placed on the duration of the share repurchase program. As part of this authorization, the Company terminated its previous repurchase program that was approved in May 2022. The following table sets forth information regarding the Company's common stock repurchases transacted during the quarter ended December 31, 2025.
It will not be otherwise filed under such Acts. 26 Unregistered Sales of Equity Securities and Use of Proceeds On January 31, 2024, the Board of Directors of the Company authorized the Company to buy back up to 1,000,000 shares of its common stock (approximately 7% of outstanding shares) in open market transactions at prices that are accretive to the earnings per share of continuing shareholders.
Stock Repurchases On January 31, 2024, the Board of Directors of the Company authorized the Company to buy back up to 1,000,000 shares of its common stock (approximately 7% of outstanding shares) in open market transactions at prices that are accretive to the earnings per share of continuing shareholders.
Added
It will not be otherwise filed under such Acts. 28 Unregistered Sales of Equity Securities and Use of Proceeds There were no sales of unregistered securities in the past three years.
Added
Total Number Maximum Number of Shares Purchased of Shares that May as Part of Publicly Yet Be Purchased Total Number of Average Price Announced Plans Under the Plans Period Shares Purchased Paid per Share or Programs or Programs October 1 - October 31, 2025* 86,430 119.18 520,453 479,547 November 1 - November 30, 2025* 55,166 119.02 575,619 424,381 *There were no common stock repurchases in December 2025.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeDuring the year ended December 31, 2024, the Company borrowed an additional $50.0 million from the Federal Home Loan Bank. 32 TABLE ONE AVERAGE BALANCE SHEETS AND NET INTEREST INCOME (In thousands) 2024 2023 2022 Average Balance Interest Yield/ Rate Average Balance Interest Yield/ Rate Average Balance Interest Yield/ Rate Assets Loan portfolio (1) : Residential real estate (2),(3) $ 1,978,804 $ 100,401 5.07 % $ 1,899,239 $ 88,083 4.64 % $ 1,755,772 $ 68,581 3.91 % Commercial, financial, and agriculture (3) 2,088,474 137,071 6.56 1,935,038 120,783 6.24 1,781,132 75,390 4.23 Installment loans to individuals (3),(4) 66,565 4,048 6.08 66,636 3,828 5.74 46,622 2,567 5.51 Total loans 4,133,843 241,520 5.84 3,900,913 212,694 5.45 3,583,526 146,538 4.09 Securities: Taxable 1,295,289 54,132 4.18 1,273,674 48,335 3.79 1,288,252 34,445 2.67 Tax-exempt (5) 158,257 4,153 2.62 175,383 4,878 2.78 218,588 6,217 2.84 Total securities 1,453,546 58,285 4.01 1,449,057 53,213 3.67 1,506,840 40,662 2.70 Deposits in depository institutions 144,134 7,495 5.20 142,299 6,382 4.48 357,184 3,794 1.06 Total interest-earning assets 5,731,523 307,300 5.36 5,492,269 272,289 4.96 5,447,550 190,994 3.51 Cash and due from banks 104,575 74,443 88,581 Bank premises and equipment 71,298 72,582 72,590 Goodwill and intangible assets 161,318 153,937 116,469 Other assets 299,378 329,198 271,685 Less: allowance for credit losses (22,804) (22,089) (17,687) Total assets $ 6,345,288 $ 6,100,340 $ 5,979,188 Liabilities Interest-bearing demand deposits $ 1,323,507 $ 15,335 1.16 % $ 1,291,234 $ 11,048 0.86 % $ 1,150,007 $ 1,234 0.11 % Savings deposits 1,231,698 8,917 0.72 1,332,527 7,979 0.60 1,414,727 1,544 0.11 Time deposits (3) 1,149,773 40,277 3.50 969,329 18,260 1.88 983,046 4,666 0.47 Short-term borrowings 337,368 15,500 4.59 290,440 12,027 4.14 284,611 2,211 0.78 FHLB long-term advances 146,721 6,163 4.20 66,849 2,709 4.05 — — — Total interest-bearing liabilities 4,189,067 86,192 2.06 3,950,379 52,023 1.32 3,832,391 9,655 0.25 Noninterest-bearing demand deposits 1,336,625 1,389,295 1,429,415 Other liabilities 107,061 125,377 98,553 Total shareholders’ equity 712,535 635,289 618,829 Total liabilities and shareholders’ equity $ 6,345,288 $ 6,100,340 $ 5,979,188 Net interest income $ 221,108 $ 220,266 $ 181,339 Net yield on earning assets 3.86 % 4.01 % 3.33 % 1.
Biggest changeNoninterest-bearing demand deposit balances increased $69.2 million, time deposit balances increased $54.2 million, savings deposit balances increased $29.2 million, and interest-bearing demand deposit balances increased $4.2 million. 33 TABLE ONE AVERAGE BALANCE SHEETS AND NET INTEREST INCOME (In thousands) 2025 2024 2023 Average Balance (6) Interest Yield/ Rate Average Balance (6) Interest Yield/ Rate Average Balance (6) Interest Yield/ Rate Assets Loan portfolio (1) : Residential real estate (2),(3) $ 2,086,207 $ 109,849 5.27 % $ 1,978,804 $ 100,401 5.07 % $ 1,899,239 $ 88,083 4.64 % Commercial, financial, and agriculture (3) 2,210,665 138,980 6.29 2,088,474 137,071 6.56 1,935,038 120,783 6.24 Installment loans to individuals (3),(4) 57,832 3,658 6.33 66,565 4,048 6.08 66,636 3,828 5.74 Total loans 4,354,704 252,487 5.80 4,133,843 241,520 5.84 3,900,913 212,694 5.45 Securities: Taxable 1,392,157 59,896 4.30 1,295,289 54,132 4.18 1,273,674 48,335 3.79 Tax-exempt (5) 137,059 3,997 2.92 158,257 4,153 2.62 175,383 4,878 2.78 Total securities 1,529,216 63,893 4.18 1,453,546 58,285 4.01 1,449,057 53,213 3.67 Deposits in depository institutions 131,001 5,675 4.33 144,134 7,495 5.20 142,299 6,382 4.48 Total interest-earning assets 6,014,921 322,055 5.35 5,731,523 307,300 5.36 5,492,269 272,289 4.96 Cash and due from banks 97,771 104,575 74,443 Bank premises and equipment 69,651 71,298 72,582 Goodwill and intangible assets 158,889 161,318 153,937 Other assets 288,361 299,378 329,198 Less: Allowance for credit losses (20,994) (22,804) (22,089) Total assets $ 6,608,599 $ 6,345,288 $ 6,100,340 Liabilities Interest-bearing demand deposits $ 1,338,751 $ 13,224 0.99 % $ 1,323,507 $ 15,335 1.16 % $ 1,291,234 $ 11,048 0.86 % Savings deposits 1,241,530 9,291 0.75 1,231,698 8,917 0.72 1,332,527 7,979 0.60 Time deposits (3) 1,287,094 42,841 3.33 1,149,773 40,277 3.50 969,329 18,260 1.88 Customer repurchase agreements 355,952 13,165 3.70 337,368 15,500 4.59 290,440 12,027 4.14 FHLB long-term advances 150,000 6,292 4.19 146,721 6,163 4.20 66,849 2,709 4.05 Total interest-bearing liabilities 4,373,327 84,813 1.94 4,189,067 86,192 2.06 3,950,379 52,023 1.32 Noninterest-bearing demand deposits 1,367,035 1,336,625 1,389,295 Other liabilities 95,225 107,061 125,377 Total shareholders’ equity 773,012 712,535 635,289 Total liabilities and shareholders’ equity $ 6,608,599 $ 6,345,288 $ 6,100,340 Net interest income $ 237,242 $ 221,108 $ 220,266 Net yield on earning assets 3.94 % 3.86 % 4.01 % 1.
Under the final rules, which went into effect on January 1, 2020, depository institutions and depository institution holding companies that have less than $10 billion in total consolidated assets and meet other qualifying criteria, including a leverage ratio of greater than 9%, off–balance–sheet exposures of 25% or less of total consolidated assets and trading assets plus trading liabilities of 5% or less of total consolidated assets, are deemed "qualifying community banking organizations" and are eligible to opt into the "community bank leverage ratio framework." A qualifying community banking organization that elects to use the community bank leverage ratio framework and that maintains a leverage ratio of greater than 9% is considered to have satisfied the generally applicable risk–based and leverage capital requirements under the Basel III Rules and, if applicable, is considered to have met the "well capitalized" ratio requirements for purposes of its primary federal regulator’s prompt corrective action rules, discussed below.
Under the final rules, which went into effect on January 1, 2020, depository institutions and depository institution holding companies that have less than $10 billion in total consolidated assets and meet other qualifying criteria, including a leverage ratio of greater than 9%, 43 off–balance–sheet exposures of 25% or less of total consolidated assets and trading assets plus trading liabilities of 5% or less of total consolidated assets, are deemed "qualifying community banking organizations" and are eligible to opt into the "community bank leverage ratio framework." A qualifying community banking organization that elects to use the community bank leverage ratio framework and that maintains a leverage ratio of greater than 9% is considered to have satisfied the generally applicable risk–based and leverage capital requirements under the Basel III Rules and, if applicable, is considered to have met the "well capitalized" ratio requirements for purposes of its primary federal regulator’s prompt corrective action rules, discussed below.
The Company has identified the following portfolio segments and measures the allowance for credit losses using the following methods: 29 Portfolio Segment Measurement Method Commercial and industrial Migration Commercial real estate: 1-4 family Migration Hotels Migration Multi-family Migration Non Residential Non-Owner Occupied Migration Non Residential Owner Occupied Migration Residential real estate Vintage Home equity Vintage Consumer Vintage Migration is an analysis that tracks a closed pool of loans for a configurable period of time and calculates a loss ratio on only those loans in the pool at the start date based on outstanding balance.
The Company has identified the following portfolio segments and measures the allowance for credit losses using the following methods: Portfolio Segment Measurement Method Commercial and industrial Migration Commercial real estate: 1-4 family Migration Hotels Migration Multi-family Migration Non Residential Non-Owner Occupied Migration Non Residential Owner Occupied Migration Residential real estate Vintage Home equity Vintage Consumer Vintage Migration is an analysis that tracks a closed pool of loans for a configurable period of time and calculates a loss ratio on only those loans in the pool at the start date based on outstanding balance.
C&I loans typically involve a higher level of risk than other loan types, including industry specific risks such as the pertinent economy, new technology, labor rates and cyclicality, 44 as well as customer specific factors, such as cash flow, financial structure, operating controls and asset quality. Collateral securing these loans includes equipment, machinery, inventory, receivables and vehicles.
C&I loans typically involve a higher level of risk than other loan types, including industry specific risks such as the pertinent economy, new technology, labor rates and cyclicality, as well as customer specific factors, such as cash flow, financial structure, operating controls and asset quality. Collateral securing these loans includes equipment, machinery, inventory, receivables and vehicles.
In addition to its branch network, City National's delivery channels include automated-teller-machines ("ATMs"), interactive-teller-machines ("ITMs"), mobile banking, debit cards, interactive voice response systems, and internet technology. The Company’s business activities are currently limited to one reportable business segment, which is community banking. See Note Twenty-Three for additional information on the Company's reportable business segment.
In addition to its branch network, City National's delivery channels include automated-teller-machines ("ATMs"), interactive-teller-machines ("ITMs"), mobile banking, debit cards, interactive voice response systems, and internet technology. The Company’s business activities are currently limited to one reportable business segment, which is community banking. See Note Three for additional information on the Company's reportable business segment.
Goodwill is considered to be impaired when the carrying value of a reporting unit exceeds its estimated fair value. Indefinite-lived intangible assets are considered impaired if their carrying value exceeds their estimated fair value. As described in Note Twenty-Three of the Notes to Consolidated Financial Statements, the Company conducts its business activities through one reportable business segment – community banking.
Goodwill is considered to be impaired when the carrying value of a reporting unit exceeds its estimated fair value. Indefinite-lived intangible assets are considered impaired if their carrying value exceeds their estimated fair value. As described in Note Three of the Notes to Consolidated Financial Statements, the Company conducts its business activities through one reportable business segment – community banking.
The current expected credit losses model ("CECL") applies to the allowance for credit losses, available-for-sale and held-to-maturity debt securities, purchased financial assets with credit deterioration and certain off-balance sheet credit exposures. Management systematically monitors the loan portfolio and the appropriateness of the allowance for credit losses on a quarterly basis to provide for expected losses inherent in the portfolio.
The current expected credit losses model ("CECL") applies to the allowance for credit losses, available-for-sale and held-to-maturity debt securities, purchased financial assets with credit deterioration and certain off-balance sheet credit exposures. 48 Management systematically monitors the loan portfolio and the appropriateness of the allowance for credit losses on a quarterly basis to provide for expected losses inherent in the portfolio.
Fixed rate mortgage loans are processed and underwritten in accordance with Fannie Mae and Freddie Mac guidelines, while adjustable rate mortgage loans are underwritten in accordance with City National's internal loan policy. 45 Consumer loans may be secured by automobiles, boats, recreational vehicles, certificates of deposit and other personal property, or they may be unsecured.
Fixed rate mortgage loans are processed and underwritten in accordance with Fannie Mae and Freddie Mac guidelines, while adjustable rate mortgage loans are underwritten in accordance with City National's internal loan policy. Consumer loans may be secured by automobiles, boats, recreational vehicles, certificates of deposit and other personal property, or they may be unsecured.
These increases were partially offset by a decrease of $2.0 million from bank owned life insurance (lower death benefits) and $0.8 million in other income. Non-interest expenses increased $3.7 million, or 2.6%, from $143.5 million for 2023 to $147.2 million for 2024.
These increases were partially offset by a decrease of $2.0 million from bank owned life insurance (lower death benefits) and $0.8 million in other income. 39 Non-interest expenses increased $3.7 million, or 2.6%, from $143.5 million for 2023 to $147.2 million for 2024.
ALLOWANCE FOR CREDIT LOSSES 46 The Company adopted ASU No. 2016-13, "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" effective January 1, 2020, using the modified retrospective method for all financial assets measured at amortized cost and off-balance sheet credit exposures.
ALLOWANCE FOR CREDIT LOSSES The Company adopted ASU No. 2016-13, "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" effective January 1, 2020, using the modified retrospective method for all financial assets measured at amortized cost and off-balance sheet credit exposures.
Future provisions for credit losses will be dependent upon trends in loan balances including the composition of the loan portfolio, changes in loan quality and loss experience trends, and recoveries of previously charged-off loans, among other factors. 47 TABLE SIX ALLOCATION OF THE ALLOWANCE FOR CREDIT LOSSES The allocation of the allowance for credit losses by portfolio segment and the percent of loans in each category to total loans is shown in the table below (dollars in thousands).
Future provisions for credit losses will be dependent upon trends in loan balances including the composition of the loan portfolio, changes in loan quality and loss experience trends, and recoveries of previously charged-off loans, among other factors. 49 TABLE SIX ALLOCATION OF THE ALLOWANCE FOR CREDIT LOSSES The allocation of the allowance for credit losses by portfolio segment and the percent of loans in each category to total loans is shown in the table below (dollars in thousands).
During the year ending December 31, 2020, the Company entered into three $50 million swap agreements that hedged interest rate risk on certain pools of the Company’s investment securities. These agreements require the Company to pay rates ranging from 0.20% to 0.24%, while receiving the federal funds effective rate in return.
During the year ending December 31, 2020, the Company entered into three $50 million swap agreements that hedged interest rate risk on certain pools of the Company’s investment securities. These agreements required the Company to pay rates ranging from 0.20% to 0.24%, while receiving the federal funds effective rate in return.
City National provides credit, deposit, and trust and investment management services to its customers in a broad geographical area that includes many rural and small community markets in addition to larger cities including Charleston (WV), Huntington (WV), Martinsburg (WV), Ashland (KY), Lexington (KY), Winchester (VA) and Staunton (VA).
City National provides credit, deposit, and wealth and investment management services to its customers in a broad geographical area that includes many rural and small community markets in addition to larger cities including Charleston (WV), Huntington (WV), Martinsburg (WV), Ashland (KY), Lexington (KY), Winchester (VA) and Staunton (VA).
During 2024, the Parent Company used cash obtained from the dividends received primarily to: (1) pay common dividends to shareholders and (2) fund repurchases of the Company's common shares. Additional information concerning sources and uses of cash by the Parent Company is discussed in Note Nineteen of the Notes to Consolidated Financial Statements.
During 2025, the Parent Company used cash obtained from the dividends received primarily to: (1) pay common dividends to shareholders and (2) fund repurchases of the Company's common shares. Additional information concerning sources and uses of cash by the Parent Company is discussed in Note Nineteen of the Notes to Consolidated Financial Statements.
Excluding the dividend payments discussed above, the Parent Company has no significant commitments or obligations in years after 2025. City National manages its liquidity position in an effort to effectively and economically satisfy the funding needs of its customers and to accommodate the scheduled repayment of borrowings.
Excluding the dividend payments discussed above, the Parent Company has no significant commitments or obligations in years after 2026. City National manages its liquidity position in an effort to effectively and economically satisfy the funding needs of its customers and to accommodate the scheduled repayment of borrowings.
Fair values are estimated by reviewing the Company’s stock price as it compares to book value and the Company’s reported earnings. In addition, the impact of future earnings and activities is considered in the Company’s analysis. The Company had approximately $150 million of goodwill at December 31, 2024 and December 31, 2023.
Fair values are estimated by reviewing the Company’s stock price as it compares to book value and the Company’s reported earnings. In addition, the impact of future earnings and activities is considered in the Company’s analysis. The Company had approximately $150 million of goodwill at December 31, 2025 and December 31, 2024.
The Company also provides overdraft protection to certain demand deposit customers that represent an unfunded commitment. As a result of the Company’s off-balance sheet arrangements for 2024 and 2023, no material revenue, expenses, or cash flows were recognized.
The Company also provides overdraft protection to certain demand deposit customers that represent an unfunded commitment. As a result of the Company’s off-balance sheet arrangements for 2025 and 2024, no material revenue, expenses, or cash flows were recognized.
This increase was largely attributable to an increase of $1.7 million, or 17.7%, in trust and investment management fee income and an increase of $1.5 million, or 5.3%, from service charges. Additionally, bankcard revenues increased $0.5 million, or 1.9%, from the year ended December 31, 2023.
This increase was largely attributable to an increase of $1.7 million, or 17.7%, in wealth and investment management fee income and an increase of $1.5 million, or 5.3%, from service charges. Additionally, bankcard revenues increased $0.5 million, or 1.9%, from the year ended December 31, 2023.
The Company manages its asset and liability mix to balance its desire to maximize net interest income against its desire to minimize risks associated with capitalization, interest rate volatility, and liquidity. Historically, the Company has utilized derivative instruments, when appropriate, to assist this goal.
The Company manages its asset and liability mix to balance its desire to maximize net interest income against its desire to minimize risks associated with capitalization, interest rate volatility, and liquidity. Historically, the Company has utilized derivative instruments, when appropriate, to assist in attaining this goal.
Management’s judgment is necessary to estimate fair value when quoted prices or observable market data are not available. At December 31, 2024, approximately 23% of total assets, or $1.5 billion, consisted of financial instruments recorded at fair value.
Management’s judgment is necessary to estimate fair value when quoted prices or observable market data are not available. At December 31, 2025, approximately 23% of total assets, or $1.5 billion, consisted of financial instruments recorded at fair value.
Regulatory agencies can initiate certain mandatory actions if either City Holding or City National fails to meet the minimum capital requirements, as shown above. As of December 31, 2024, management believes that City Holding and City National meet all capital adequacy requirements.
Regulatory agencies can initiate certain mandatory actions if either City Holding or City National fails to meet the minimum capital requirements, as shown above. As of December 31, 2025, management believes that City Holding and City National meet all capital adequacy requirements.
Based on the Company’s analysis of the adequacy of the allowance for credit losses and in consideration of the known factors utilized in computing the allowance, management believes that the allowance for credit losses as of December 31, 2024 is adequate to provide for expected losses inherent in the Company’s loan portfolio.
Based on the Company’s analysis of the adequacy of the allowance for credit losses and in consideration of the known factors utilized in computing the allowance, management believes that the allowance for credit losses as of December 31, 2025 is adequate to provide for expected losses inherent in the Company’s loan portfolio.
The interest associated with variable-rate obligations is based upon interest rates in effect at December 31, 2024. The contractual amounts to be paid on variable-rate obligations are affected by market interest rates that could materially affect the contractual amounts to be paid.
The interest associated with variable-rate obligations is based upon interest rates in effect at December 31, 2025. The contractual amounts to be paid on variable-rate obligations are affected by market interest rates that could materially affect the contractual amounts to be paid.
The Company categorizes commercial loans by industry according to the North American Industry Classification System ("NAICS") to monitor the portfolio for possible concentrations in one or more industries. Management monitors industry concentrations against internally established risk-based capital thresholds. As of December 31, 2024, City National was within its internally designated concentration limits.
The Company categorizes commercial loans by industry according to the North American Industry Classification System ("NAICS") to monitor the portfolio for possible concentrations in one or more industries. Management monitors industry concentrations against internally established risk-based capital thresholds. As of December 31, 2025, City National 46 was within its internally designated concentration limits.
As of December 31, 2024, City National's loans to borrowers within the Lessors of Nonresidential Buildings (14%) and Lessors of Residential Buildings and Dwellings (11%) categories exceeded 10% of total loans. No other NAICS industry classification exceeded 10% of total loans as of December 31, 2024.
As of December 31, 2025, City National's loans to borrowers within the Lessors of Nonresidential Buildings (14%) and Lessors of Residential Buildings and Dwellings (11%) categories exceeded 10% of total loans. No other NAICS industry classification exceeded 10% of total loans as of December 31, 2025.
The Company is currently open to audit under the statute of limitations by the Internal Revenue Service and various state taxing authorities for the years ended December 31, 2021 and forward. The effective tax rate is calculated by taking the statutory rate and adjusting for permanent and discrete items.
The Company is currently open to audit under the statute of limitations by the Internal Revenue Service and various state taxing authorities for the years ended December 31, 2022 and forward. 32 The effective tax rate is calculated by taking the statutory rate and adjusting for permanent and discrete items.
City National had an additional $1.5 billion and $1.9 billion available from unused portions of lines of credit with the FHLB and Federal Reserve Discount Window at December 31, 2024 and 2023, respectively. No short-term or long-term funding has been utilized with certain other financial institutions the Company maintains business relationships as of December 31, 2024 or December 31, 2023.
City National had an additional $1.7 billion and $1.5 billion available from unused portions of lines of credit with the FHLB and Federal Reserve Discount Window at December 31, 2025 and 2024, respectively. No short-term or long-term funding has been utilized with certain other financial institutions the Company maintains business relationships as of December 31, 2025 or December 31, 2024.
Based on the valuation techniques used and the sensitivity of financial statement amounts to the methods, assumptions, and estimates underlying those amounts, management has identified: (i) the determination of the allowance for credit losses (ii) income taxes and (iii) acquisition and preliminary purchase price accounting to be the accounting areas that require the most subjective or complex judgments and, as such, could be most subject to revision as new information becomes available.
Based on the valuation techniques used and the sensitivity of financial statement amounts to the methods, assumptions, and estimates underlying those amounts, management has identified: (i) the determination of the allowance for credit losses and (ii) income taxes accounting to be the accounting areas that require the most subjective or complex judgments and, as such, could be most subject to revision as new information becomes available.
The Company’s liability for uncertain tax positions at December 31, 2024 was $1.3 million pursuant to ASC Topic 740. This liability represents an estimate of tax positions that the Company has taken in its tax returns that may ultimately not be sustained upon examination by tax authorities.
The Company’s liability for uncertain tax positions at December 31, 2025 was $1.5 million pursuant to ASC Topic 740. This liability represents an estimate of tax positions that the Company has taken in its tax returns that may ultimately not be sustained upon examination by tax authorities.
Geographically, the portfolio supports the 43 Company's footprint, with 17% of the portfolio being from municipalities throughout West Virginia, and the remainder from communities in Texas, Washington, Ohio and various other states.
Geographically, the portfolio supports the Company's footprint, with 16% of the portfolio being from municipalities throughout West Virginia, and the remainder from communities in Texas, Washington, Ohio and various other states.
Most of these financial instruments used valuation methodologies involving observable market data, collectively Level 1 and Level 2 measurements, to determine fair value. At December 31, 2024, approximately $51 million of derivative liabilities were recorded at fair value using methodologies involving observable market data.
Most of these financial instruments used valuation methodologies involving observable market data, collectively Level 1 and Level 2 measurements, to determine fair value. At December 31, 2025, approximately $34 million of derivative liabilities were recorded at fair value using methodologies involving observable market data.
Short-term Borrowings 39 28 CITY HOLDING COMPANY City Holding Company (the "Company"), a West Virginia corporation headquartered in Charleston, West Virginia, is a registered financial holding company under the Bank Holding Company Act and conducts its principal activities through its wholly owned subsidiary, City National Bank of West Virginia ("City National").
Short-term Borrowings 40 30 CITY HOLDING COMPANY City Holding Company (the "Company"), a West Virginia corporation headquartered in Charleston, West Virginia, is a registered financial holding company under the Bank Holding Company Act and conducts its principal activities through its wholly owned subsidiary, City National Bank of West Virginia ("City National").
The portfolio totaled $240.9 million as of December 31, 2024. Risk characteristics are driven by rental housing demand as well as economic and employment conditions. ◦ Non-residential commercial real estate includes properties such as retail, office, warehouse, storage, healthcare, entertainment, religious, and other nonresidential commercial properties. The non-residential product type is further segmented into owner- and non-owner occupied properties.
The portfolio totaled $237.4 million as of December 31, 2025. Risk characteristics are driven by rental housing demand as well as economic and employment conditions. ◦ Non-residential commercial real estate includes properties such as retail, office, warehouse, storage, healthcare, entertainment, religious, and other nonresidential commercial properties. The non-residential product type is further segmented into owner- and non-owner occupied properties.
Average Balance Sheets 33 b. Analysis of Net Interest Earnings 34 c. Rate Volume Analysis of Changes in Interest Income and Expense 34 II. Investment Portfolio a. Maturity Schedule of Investments 43 III. Loan Portfolio a. Types of Loans 44 b. Maturities and Sensitivity to Changes in Interest Rates 44 c. Other Interest Bearing Assets None d.
Average Balance Sheets 34 b. Analysis of Net Interest Earnings 35 c. Rate Volume Analysis of Changes in Interest Income and Expense 35 II. Investment Portfolio a. Maturity Schedule of Investments 45 III. Loan Portfolio a. Types of Loans 45 b. Maturities and Sensitivity to Changes in Interest Rates 45 c. Other Interest Bearing Assets None d.
INCOME TAXES Selected information regarding the Company's income taxes is presented in the table below (dollars in millions): For the year ended December 31, 2024 2023 2022 Income tax expense $ 27.4 $ 28.7 $ 25.3 Effective tax rate 19.0 % 20.1 % 19.8 % A reconciliation of the effective tax rate to the statutory rate is included in Note Twelve of the Notes to Consolidated Financial Statements.
INCOME TAXES Selected information regarding the Company's income taxes is presented in the table below (dollars in millions): For the year ended December 31, 2025 2024 2023 Income tax expense $ 31.0 $ 27.4 $ 28.7 Effective tax rate 19.2 % 19.0 % 20.1 % A reconciliation of the effective tax rate to the statutory rate is included in Note Twelve of the Notes to Consolidated Financial Statements.
As illustrated in the Consolidated Statements of Cash Flows, the Company generated $131.9 million of cash from operating activities during 2024, primarily from interest income received on loans and investments, net of interest expense paid on deposits and borrowings.
As illustrated in the Consolidated Statements of Cash Flows, the Company generated $131.4 million of cash from operating activities during 2025, primarily from interest income received on loans and investments, net of interest expense paid on deposits and borrowings.
The Company has obligations to extend credit, but these obligations are primarily associated with existing home equity loans that have predictable borrowing patterns across the portfolio. The Company has investment security balances with carrying values that totaled $1.45 billion at December 31, 2024, and that greatly exceeded the Company’s non-deposit sources of borrowing, which totaled $476 million.
The Company has obligations to extend credit, but these obligations are primarily associated with existing home equity loans that have predictable borrowing patterns across the portfolio. The Company has investment security balances with carrying values that totaled $1.53 billion at December 31, 2025, and that greatly exceeded the Company’s non-deposit sources of borrowing, which totaled $518 million.
In order to group loans with similar risk characteristics, the portfolio is further segmented by product types: ◦ Commercial 1-4 Family loans consist of residential single-family, duplex, triplex, and fourplex rental properties and totaled $197.3 million as of December 31, 2024. Risk characteristics are driven by rental housing demand as well as economic and employment conditions.
In order to group loans with similar risk characteristics, the portfolio is further segmented by product types: ◦ Commercial 1-4 Family loans consist of residential single-family, duplex, triplex, and fourplex rental properties and totaled $210.2 million as of December 31, 2025. Risk characteristics are driven by rental housing demand as well as economic and employment conditions.
Risk Elements 76 V. Deposits a. Breakdown of Deposits by Categories, Average Balance and Average Rate Paid 33 b. Maturity Schedule of Uninsured Time Certificates of Deposit 49 VI. Return on Equity and Assets 31 VII.
Risk Elements 76 V. Deposits a. Breakdown of Deposits by Categories, Average Balance and Average Rate Paid 34 b. Maturity Schedule of Uninsured Time Certificates of Deposit 51 VI. Return on Equity and Assets 33 VII.
The portfolio has 92% rated "A" or better and the remaining portfolio is unrated, as the issuances represented small issuances of revenue bonds. Additional credit support has been purchased by the issuer for 25% of the portfolio, while 75% has no additional credit support.
The portfolio has 92% rated "A" or better and the remaining portfolio is unrated, as the issuances represented small issuances of revenue bonds. Additional credit support has been purchased by the issuer for 31% of the portfolio, while 69% has no additional credit support.
These properties exhibit greater risk than multi-family properties due to fewer income sources. ◦ The Hotel portfolio is comprised of all lodging establishments and totaled $389.7 million as of December 31, 2024. Risk characteristics relate to the demand for both business and personal travel. ◦ Multi-family consists of 5 or more family residential apartment lending.
These properties exhibit greater risk than multi-family properties due to fewer income sources. ◦ The Hotel portfolio is comprised of all lodging establishments and totaled $398.6 million as of December 31, 2025. Risk characteristics relate to the demand for both business and personal travel. ◦ Multi-family consists of 5 or more family residential apartment lending.
In addition to these anticipated cash needs, the Parent Company has operating expenses and other contractual obligations, which are estimated to 39 require $1.8 million of additional cash over the next 12 months.
In addition to these anticipated cash needs, the Parent Company has operating expenses and other contractual obligations, which are estimated to require $2.2 million of additional cash over the next 12 months.
The Company’s reported net interest margin increased from 3.33% for the year ended December 31, 2022 to 4.01% for the year ended December 31, 2023. Non-GAAP Financial Measures Management of the Company uses measures in its analysis of the Company's performance other than those in accordance with generally accepted accounting principles in the United States of America ("GAAP").
The Company’s reported net interest margin decreased from 4.01% for the year ended December 31, 2023 to 3.86% for the year ended December 31, 2024. Non-GAAP Financial Measures Management of the Company uses measures in its analysis of the Company's performance other than those in accordance with generally accepted accounting principles in the United States of America ("GAAP").
For purposes of this table, non-accruing loans have been included in average balances and the following net loan fees (in thousands) have been included in interest income: 2024 2023 2022 Loan fees, net $ 494 $ 1,366 $ 568 2. Includes the Company's residential real estate and home equity loan categories. 33 3.
For purposes of this table, non-accruing loans have been included in average balances and the following net loan fees (in thousands) have been included in interest income: 2025 2024 2023 Loan fees, net $ 357 $ 494 $ 1,366 2. Includes the Company's residential real estate and home equity loan categories. 34 3.
Generally, any dividends in amounts that exceed the earnings retained by City National in the current year plus retained net profits for the preceding two years must be approved by regulatory authorities. At December 31, 2024, City National could pay dividends up to $48.2 million without prior regulatory permission.
Generally, any dividends in amounts that exceed the earnings retained by City National in the current year plus retained net profits for the preceding two years must be approved by regulatory authorities. At December 31, 2025, City National could pay dividends up to $43.7 million without prior regulatory permission.
No impairment was required to be recognized in 2024 or 2023, as the estimated fair value of the Company has continued to exceed its book value. CERTIFICATES OF DEPOSIT The Company has time certificates of deposit that meet or exceed the FDIC insurance limit of $250,000 totaling an estimated $441.9 million at December 31, 2024.
No impairment was required to be recognized in 2025 or 2024, as the estimated fair value of the Company has continued to exceed its book value. CERTIFICATES OF DEPOSIT The Company has time certificates of deposit that meet or exceed the FDIC insurance limit of $250,000 totaling an estimated $467.7 million at December 31, 2025.
Scheduled maturities of uninsured time certificates of deposit are estimated at December 31, 2024 and are summarized in the table below (in thousands).
Scheduled maturities of uninsured portion of time certificates of deposit are estimated at December 31, 2025 and are summarized in the table below (in thousands).
Management also monitors non-owner occupied commercial real estate as a percent of risk based capital (based upon regulatory guidance). At December 31, 2024, the Company had $1.5 billion of commercial loans classified as non-owner occupied and was within its designated concentration threshold. Residential real estate loans increased $35.5 million from December 31, 2023 to $1.82 billion at December 31, 2024.
Management also monitors non-owner occupied commercial real estate as a percent of risk based capital (based upon regulatory guidance). At December 31, 2025, the Company had $1.6 billion of commercial loans classified as non-owner occupied and was within its designated concentration threshold. Residential real estate loans increased $86.5 million from December 31, 2024 to $1.91 billion at December 31, 2025.
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The Company was in a net deferred tax asset position ($41.7 million) at December 31, 2024 and a net deferred tax asset position ($42.2 million) at December 31, 2023.
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The Company was in a net deferred tax asset position ($30.0 million) at December 31, 2025 and a net deferred tax asset position ($41.7 million) at December 31, 2024.
Interest income and changes in market valuations from these swap agreements are recognized as investment income in the accompanying statements of income. These agreements mature in October ($50 million) and November ($100 million) of 2025.
Interest income and changes in market valuations from these swap agreements were recognized as investment income in the accompanying statements of income. These agreements matured in October ($50 million) and November ($100 million) of 2025.
Based on sensitivity of the portfolio, the change had no material impact on the reserve. Based on sensitivity analysis of all portfolios, a 0.0050% change (slight improvement or decline on bank's scale) in all 11 qualitative risk factors (where assigned) would have a $2.2 million impact on the reserve allocation.
Based on sensitivity of the portfolio, the change had a less than $0.5 million impact on the reserve. Based on sensitivity analysis of all portfolios, a 0.0050% change (slight improvement or decline on bank's scale) in all 11 qualitative risk factors (where assigned) would have a $2.4 million impact on the reserve allocation.
In the December 31, 2024 estimate, the Company assumed an unemployment forecast range of 4.2% to 4.8%, compared to a range of 3.8% to 4.8% utilized in the December 31, 2023 estimate. Historical loss rates from periods where the average unemployment rate matches the forecast range are considered when calculating the forecast period loss rate.
In the December 31, 2025 estimate, the Company assumed a 2-year unemployment forecast range of 4.2% to 4.6%, compared to a range of 4.2% to 4.8% utilized in the December 31, 2024 estimate. Historical loss rates from periods where the average unemployment rate matches the forecast range are considered when calculating the forecast period loss rate.
City National is a retail and consumer-oriented community bank with 97 bank branches in West Virginia (58), Kentucky (22), Virginia (13) and southeastern Ohio (4).
City National is a retail and consumer-oriented community bank with 96 bank branches in West Virginia (58), Kentucky (22), Virginia (13) and southeastern Ohio (3).
As of December 31, 2024, the Parent Company reported a cash balance of $117.3 million and management believes that the Parent Company’s available cash balance, together with cash dividends from City National, will be adequate to satisfy its funding and cash needs over the next twelve months.
As of December 31, 2025, the Parent Company reported a cash balance of $148.9 million and management believes that the Parent Company’s available cash balance, together with 40 cash dividends from City National, will be adequate to satisfy its funding and cash needs over the next twelve months.
The Parent Company anticipates continuing the payment of dividends, which are expected to approximate $46.5 million on an annualized basis for 2025 based on common shareholders of record at December 31, 2024 at a dividend rate of $3.16 per share for 2025. However, dividends to shareholders can, if necessary, be suspended.
The Parent Company anticipates continuing the payment of dividends, which are expected to approximate $50.0 million on an annualized basis for 2026 based on common shareholders of record at December 31, 2025 at a dividend rate of $3.48 per share for 2026. However, dividends to shareholders can, if necessary, be suspended.
During the year ended December 31, 2024, the Company repurchased approximately 179,000 common shares at a weighted average price of $100.24 per share as part of a one million share repurchase plan authorized by the Board of Directors in January 2024. At December 31, 2024, the Company could repurchase an additional approximately 821,000 shares under the current plan.
During the year ended December 31, 2025, the Company repurchased approximately 397,000 common shares at a weighted average price of $115.24 per share as part of a one million share repurchase plan authorized by the Board of Directors in January 2024. At December 31, 2025, the Company could repurchase approximately 424,000 additional shares under the current plan.
The credit and collateral documents for each potential purchased loan are reviewed to ensure the credit metrics are acceptable to management. At December 31, 2024, $7.5 million of the residential real estate loans were for properties under construction. Home equity loans increased $32.0 million from December 31, 2023 to $199 million at December 31, 2024.
The credit and collateral documents for each potential purchased loan are reviewed to ensure the credit metrics are acceptable to management. At December 31, 2025, $9.9 million of the residential real estate loans were for properties under construction. Home equity loans increased $25.5 million from December 31, 2024 to $224.7 million at December 31, 2025.
LIQUIDITY AND CAPITAL RESOURCES Liquidity The Company evaluates the adequacy of liquidity at both the Parent Company level and at the banking subsidiary level. At the Parent Company level, the principal source of cash is dividends from its banking subsidiary, City National. Dividends paid by City National to the Parent Company are subject to certain legal and regulatory limitations.
At the Parent Company level, the principal source of cash is dividends from its banking subsidiary, City National. Dividends paid by City National to the Parent Company are subject to certain legal and regulatory limitations.
As a result of the Company’s analysis of the adequacy of the Allowance for Credit Losses, the Company recorded a provision for credit losses of $1.8 million for the year ended December 31, 2024 and $3.2 million for the year ended December 31, 2023.
As a result of the Company’s analysis of the adequacy of the Allowance for Credit Losses, the Company recorded a recovery of credit losses of $1.4 million for the year ended December 31, 2025 and a provision for credit losses of $1.8 million for the year ended December 31, 2024.
The Company’s net loan to asset ratio is 65.8% as of December 31, 2024 and deposit balances fund 79.6% of total assets as compared to 72.2% for its peers (Bank Holding Company Peer Group, as of the most recent data available as of September 30, 2024, which includes commercial banks with assets ranging from $3 billion to $10 billion).
The Company’s net loan to asset ratio is 66.8% as of December 31, 2025 and deposit balances fund 78.9% of total assets as compared to 73.0% for its peers (Bank Holding Company Peer Group, as of the most recent data available as of September 30, 2025, which includes commercial banks with assets ranging from $3 billion to $10 billion).
Included in the above table are the following amounts (in thousands) for the accretion of the fair value adjustments related to the Company's acquisitions: 2024 2023 2022 Residential real estate $ 202 $ 243 $ 298 Commercial, financial, and agriculture 3,301 2,276 642 Installment loans to individuals 21 41 45 Time deposits 110 535 83 Total $ 3,634 $ 3,095 $ 1,068 4.
Included in the above table are the following amounts (in thousands) for the accretion of the fair value adjustments related to the Company's acquisitions: 2025 2024 2023 Residential real estate $ 352 $ 202 $ 243 Commercial, financial, and agriculture 2,217 3,301 2,276 Installment loans to individuals 10 21 41 Time deposits 15 110 535 Total $ 2,594 $ 3,634 $ 3,095 4.
FINANCIAL SUMMARY The Company’s financial performance over the previous three years is summarized in the following table: 2024 2023 2022 Net income available to common shareholders (in thousands) $ 117,101 $ 114,365 $ 102,071 Earnings per common share, basic $ 7.91 $ 7.62 $ 6.81 Earnings per common share, diluted $ 7.89 $ 7.61 $ 6.80 Cash dividends declared $ 3.01 $ 2.73 $ 2.50 Book value per share $ 49.69 $ 45.65 $ 39.08 Dividend payout ratio 38.1 % 35.9 % 36.8 % ROA* 1.85 % 1.87 % 1.71 % ROE* 16.4 % 18.0 % 16.5 % ROATCE* 21.2 % 23.8 % 20.3 % *ROA (Return on Average Assets) is a measure of the effectiveness of asset utilization.
FINANCIAL SUMMARY The Company’s financial performance over the previous three years is summarized in the following table: 2025 2024 2023 Net income available to common shareholders (in thousands) $ 130,485 $ 117,101 $ 114,365 Earnings per common share, basic $ 8.94 $ 7.91 $ 7.62 Earnings per common share, diluted $ 8.93 $ 7.89 $ 7.61 Cash dividends declared $ 3.32 $ 3.01 $ 2.73 Book value per share $ 56.41 $ 49.69 $ 45.65 Dividend payout ratio 37.2 % 38.1 % 35.9 % ROA* 1.97 % 1.85 % 1.87 % ROE* 16.9 % 16.4 % 18.0 % ROATCE* 21.2 % 21.2 % 23.8 % *ROA (Return on Average Assets) is a measure of the effectiveness of asset utilization.
Average yields on investments available-for-sale are computed based on amortized cost. Mortgage-backed securities have been allocated to their respective maturity groupings based on their contractual maturity. TABLE FIVE LOAN PORTFOLIO Loans increased $148.9 million (3.6%) from December 31, 2023 to $4.27 billion at December 31, 2024.
Average yields on investments available-for-sale are computed based on amortized cost. Mortgage-backed securities have been allocated to their respective maturity groupings based on their contractual maturity. 45 TABLE FIVE LOAN PORTFOLIO Loans increased $232.2 million (5.4%) from December 31, 2024 to $4.51 billion at December 31, 2025.
TABLE SEVEN MATURITY DISTRIBUTION OF UNINSURED CERTIFICATES OF DEPOSIT Amounts Three months or less $ 50,418 Over three months through six months 68,370 Over six months through twelve months 49,746 Over twelve months 11,605 Total $ 180,139 FAIR VALUE MEASUREMENTS The Company determines the fair value of its financial instruments based on the fair value hierarchy established in ASC Topic 820, whereby the fair value of certain assets and liabilities is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants.
TABLE SEVEN MATURITY DISTRIBUTION OF UNINSURED CERTIFICATES OF DEPOSIT Amounts Three months or less $ 73,018 Over three months through six months 64,101 Over six months through twelve months 47,732 Over twelve months 12,076 Total $ 196,927 FAIR VALUE MEASUREMENTS The Company determines the fair value of its financial instruments based on the fair value hierarchy established in ASC Topic 820, whereby the fair value of certain assets and liabilities is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants.
The following table reconciles fully taxable equivalent net interest income with net interest income as derived from the Company's financial statements, as well as other non-GAAP measures (dollars in thousands): 36 TABLE THREE NON-GAAP FINANCIAL MEASURES (dollars in thousands) 2024 2023 2022 Net interest income ("GAAP") $ 220,237 $ 219,241 $ 180,033 Taxable equivalent adjustment 871 1,025 1,306 Net interest income, fully taxable equivalent $ 221,108 $ 220,266 $ 181,339 Equity to assets ("GAAP") 11.31 % 10.98 % 9.83 % Effect of goodwill and other intangibles, net (2.25) (2.41) (1.81) Tangible common equity to tangible assets 9.06 % 8.57 % 8.02 % 37 NON-INTEREST INCOME AND NON-INTEREST EXPENSE 2024 vs. 2023 Selected income statement fluctuations and ratios are summarized in the following table (dollars in millions): For the year ended December 31, 2024 2023 $ Change % Change Net investment security losses $ (2.7) $ (4.5) $ 1.8 40 % Non-interest income, excluding net investment securities (losses) gains 76.0 75.1 0.9 1 % Non-interest expense, excluding merger-related expenses 147.2 138.4 8.9 6 % Non-interest income was $73.3 million for the year ended December 31, 2024, as compared to $70.6 million for the year ended December 31, 2023.
The following table reconciles fully taxable equivalent net interest income with net interest income as derived from the Company's financial statements, as well as other non-GAAP measures (dollars in thousands): 37 TABLE THREE NON-GAAP FINANCIAL MEASURES (dollars in thousands) 2025 2024 2023 Net interest income ("GAAP") $ 236,403 $ 220,237 $ 219,241 Taxable equivalent adjustment 839 871 1,025 Net interest income, fully taxable equivalent $ 237,242 $ 221,108 $ 220,266 Equity to assets ("GAAP") 12.04 % 11.31 % 10.98 % Effect of goodwill and other intangibles, net (2.11) (2.25) (2.41) Tangible common equity to tangible assets 9.93 % 9.06 % 8.57 % 38 NON-INTEREST INCOME AND NON-INTEREST EXPENSE 2025 vs. 2024 Selected income statement fluctuations and ratios are summarized in the following table (dollars in millions): For the year ended December 31, 2025 2024 $ Change % Change Net investment security losses $ (0.4) $ (2.7) $ 2.3 85 % Non-interest income, excluding net investment securities losses 78.2 76.0 2.2 3 % Non-interest expense 154.1 147.2 6.9 5 % Non-interest income was $77.8 million for the year ended December 31, 2025, as compared to $73.3 million for the year ended December 31, 2024.
The Company manages the risk associated with consumer loans by monitoring such factors as portfolio size and growth, internal lending policies and pertinent economic conditions. City National's underwriting standards are continually evaluated and modified based upon these factors. Consumer loans decreased $7.4 million from 2023 to $58 million at December 31, 2024.
The Company manages the risk associated with consumer loans by monitoring such factors as portfolio size and growth, internal lending policies and pertinent economic conditions. City National's underwriting standards are continually evaluated and modified based upon these factors.
The Company's municipal bond portfolio of $184 million as of December 31, 2024 has an average tax equivalent yield of 2.58% with an average maturity of 11.2 years. The average dollar amount invested in each security is $1.3 million.
The Company's municipal bond portfolio of $180 million as of December 31, 2025 has an average tax equivalent yield of 2.83% with an average maturity of 12.7 years. The average dollar amount invested in each security is $1.4 million.
Nonresidential non-owner occupied commercial real estate totaled $707.3 million while nonresidential owner-occupied commercial real estate totaled $233.5 million as of December 31, 2024. Risk characteristics relate to levels of consumer spending and overall economic conditions.
Nonresidential non-owner occupied commercial real estate totaled $767.6 million while nonresidential owner-occupied commercial real estate totaled $253.4 million as of December 31, 2025. Risk characteristics relate to levels of consumer spending and overall economic conditions.
Income Taxes The Income Taxes section of this Annual Report on Form 10-K provides management’s analysis of the Company’s income taxes. The Company is subject to federal and state income taxes in the jurisdictions in which it conducts business. In computing the provision for income taxes, management must make judgments regarding interpretation of laws in those jurisdictions.
The Company is subject to federal and state income taxes in the jurisdictions in which it conducts business. In computing the provision for income taxes, management must make judgments regarding interpretation of laws in those jurisdictions.
In 2023, the Company reported $4.9 million of realized security losses and $0.4 million of unrealized security gains on the Company’s equity securities as compared to $1.6 million of unrealized security losses on the Company’s equity securities in 2022.
In 2025, the Company reported $0.2 million of realized security gains and $0.6 million of unrealized security losses on the Company’s equity securities as compared to $2.8 million realized security losses and $0.2 million of unrealized security gains on the Company’s equity securities in 2024.
These expenses were partially offset by lower other expenses of $2.9 million that were primarily related to acquisition and integration expenses associated with the Citizens acquisition completed in 2023 ($5.2 million). 2023 vs. 2022 Selected income statement fluctuations are summarized in the following table (dollars in millions): For the year ended December 31, 2023 2022 $ Change % Change Net investment security losses $ (4.5) $ (1.6) $ (2.9) (181) % Non-interest income, excluding net investment securities (losses) gains 75.1 73.7 1.4 2 % Non-interest expense, less merger related expenses 138.4 124.0 14.4 12 % Non-interest income was $70.6 million for the year ended December 31, 2023, as compared to $72.1 million for the year ended December 31, 2022.
These expenses were partially offset by lower advertising expenses of $0.7 million. 2024 vs. 2023 Selected income statement fluctuations are summarized in the following table (dollars in millions): For the year ended December 31, 2024 2023 $ Change % Change Net investment security losses $ (2.7) $ (4.5) $ 1.8 40 % Non-interest income, excluding net investment securities losses 76.0 75.1 0.9 1 % Non-interest expense, excluding merger-related expenses 147.2 138.4 8.8 6 % Non-interest income was $73.3 million for the year ended December 31, 2024, as compared to $70.6 million for the year ended December 31, 2023.
Short-term borrowings and FHLB long-term advances represent borrowings of the Company and have stated maturity dates.
Short-term borrowings and FHLB long-term advances represent borrowings of the Company and have stated maturity dates. Operating leases between the Company and the lessor have stated expiration dates and renewal terms.
NET INTEREST INCOME 2024 2023 2022 Total interest income $ 306,429 $ 271,264 $ 189,688 Total interest expense 86,192 52,023 9,655 Net interest income 220,237 219,241 180,033 2024 vs. 2023 The Company’s net interest income increased from $219.2 million for the year ended December 31, 2023 to $220.2 million for the year ended December 31, 2024.
NET INTEREST INCOME 2025 2024 2023 Total interest income $ 321,216 $ 306,429 $ 271,264 Total interest expense 84,813 86,192 52,023 Net interest income $ 236,403 $ 220,237 $ 219,241 2025 vs. 2024 The Company’s net interest income increased from $220.2 million for the year ended December 31, 2024 to $236.4 million for the year ended December 31, 2025.
The Company does not believe that any changes in the unobservable inputs used to value the financial instruments mentioned above would have a material impact on the Company’s results of operations, liquidity, or capital resources. See Note Eighteen of the Notes to Consolidated Financial Statements for additional information regarding ASC Topic 820 and its impact on the Company’s financial statements.
The Company does not believe that any changes in the unobservable inputs used to value the financial instruments mentioned above would have a material impact on the Company’s results of operations, liquidity, or capital resources.
Changing each factor by 0.01% (moderate improvement or decline) would have a $4.5 million impact. Management recognizes that these are extreme scenarios and it is very unlikely that all risk factors would change by 0.005% or 0.01% simultaneously. There were no changes to any qualitative factors for the year ended December 31, 2024.
Changing each factor by 0.01% (moderate improvement or decline) would have a $4.7 million impact. Management recognizes that these are extreme scenarios and it is very unlikely that all risk factors would change by 0.005% or 0.01% simultaneously.
The Company’s reported net interest margin decreased from 4.01% for the year ended December 31, 2023 to 3.86% for the year ended December 31, 2024. 35 2023 vs. 2022 The Company’s net interest income increased from $180.0 million for the year ended December 31, 2022 to $219.2 million for the year ended December 31, 2023.
The Company’s reported net interest margin increased from 3.86% for the year ended December 31, 2024 to 3.94% for the year ended December 31, 2025. 36 2024 vs. 2023 The Company’s net interest income increased from $219.2 million for the year ended December 31, 2023 to $220.2 million for the year ended December 31, 2024.
These evaluations are conducted at least quarterly and more frequently if deemed necessary. Additionally, all commercial loans within the portfolio are subject to internal risk grading. Risk grades are generally assigned by the primary lending officer and are periodically evaluated by the Company’s internal loan review process.
These evaluations are conducted at least quarterly and more frequently if deemed necessary. Additionally, all commercial loans within the portfolio are subject to internal risk grading.
This increase was primarily due to net income of $117 million that was partially offset by cash dividends declared of $45 million, common share repurchases of $18 million, and other comprehensive losses of $5 million.
This increase was primarily due to net income of $130 million and other comprehensive income of $39 million, which were partially offset by cash dividends declared of $48 million and common share repurchases of $46 million.
Commercial real estate loans increased $95.2 million (5.7%), residential real estate loans increased $35.5 million (2.0%), and home equity loans increased $32.0 million (19.1%) for the year ended December 31, 2024. These increases were partially 31 offset by a decrease in consumer loans of $7.4 million (11.4%) and a decrease in commercial and industrial loans of $7.1 million (1.7%).
Commercial real estate loans increased $98.6 million (5.6%), residential real estate loans increased $86.5 million (4.7%), commercial and industrial loans increased $34.1 million (8.1%), and home equity loans increased $25.5 million (12.8%) for the year ended December 31, 2025. These increases were partially offset by a decrease in consumer loans of $10.5 million (18.1%).
As disclosed in Note Fifteen of the Notes to Consolidated Financial Statements, the Company has entered into agreements with its customers to extend credit or to provide conditional commitments to provide payment on drafts presented in accordance with the terms of the underlying credit documents (including standby and commercial letters of credit).
As the ultimate amount and timing of any future cash settlements cannot be predicted with reasonable reliability, this estimated liability has been excluded from the contractual obligations table. 44 As disclosed in Note Fifteen of the Notes to Consolidated Financial Statements, the Company has entered into agreements with its customers to extend credit or to provide conditional commitments to provide payment on drafts presented in accordance with the terms of the underlying credit documents (including standby and commercial letters of credit).

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeInternally, the Company considers a variety of interest rate scenarios that are deemed to be possible while considering the level of risk it is willing to assume in "worst-case" scenarios such as shown by the following: Immediate Basis Point Change in Interest Rates Implied Federal Funds Rate Associated with Change in Interest Rates Estimated Increase (Decrease) in Net Income Over 12 Months December 31, 2024 +300 7.50 3.2 % +200 6.50 5.9 +100 5.50 7.0 -100 3.50 -2.9 -200 2.50 -7.8 -300 1.50 -13.2 December 31, 2023 +300 8.50 % -4.5 % +200 7.50 -2.4 +100 6.50 -1.6 -100 4.50 -7.2 -200 3.50 -8.3 -300 2.50 -13.9 These estimates are highly dependent upon assumptions made by management, including, but not limited to, assumptions regarding the manner in which interest-bearing demand deposit and savings deposit accounts reprice in different interest rate scenarios, changes in the composition of deposit balances, pricing behavior of competitors, prepayments of loans 51 and deposits under alternative rate environments, and new business volumes and pricing.
Biggest changeInternally, the Company considers a variety of interest rate scenarios that are deemed to be possible while considering the level of risk it is willing to assume in "worst-case" scenarios such as shown by the following: Immediate Basis Point Change in Interest Rates Implied Federal Funds Rate Associated with Change in Interest Rates Estimated Increase (Decrease) in Net Income Over 12 Months December 31, 2025 +300 6.75 0.2 % +200 5.75 2.6 +100 4.75 3.1 -100 2.75 (1.6) -200 1.75 (4.8) -300 0.75 (10.0) December 31, 2024 +300 7.50 % 3.2 % +200 6.50 5.9 +100 5.50 7.0 -100 3.50 (2.9) -200 2.50 (7.8) -300 1.50 (13.2) These estimates are highly dependent upon assumptions made by management, including, but not limited to, assumptions regarding the manner in which interest-bearing demand deposit and savings deposit accounts reprice in different interest rate scenarios, changes in the composition of deposit balances, pricing behavior of competitors, prepayments of loans 53 and deposits under alternative rate environments, and new business volumes and pricing.
As a result, there can be no assurance that the estimates above will be achieved in the event that interest rates increase or decrease during 2025 and beyond. The estimates above do not necessarily imply that the Company will experience increases in net income if market interest rates rise.
As a result, there can be no assurance that the estimates above will be achieved in the event that interest rates increase or decrease during 2026 and beyond. The estimates above do not necessarily imply that the Company will experience increases in net income if market interest rates rise.
The table above indicates how the Company’s net income behave relative to an increase or decrease in rates compared to what would otherwise occur if rates remain stable. 52
The table above indicates how the Company’s net income behave relative to an increase or decrease in rates compared to what would otherwise occur if rates remain stable. 54

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