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What changed in FULTON FINANCIAL CORP's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of FULTON FINANCIAL CORP'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.

+305 added−321 removedSource: 10-K (2026-02-27) vs 10-K (2025-02-28)

Top changes in FULTON FINANCIAL CORP's 2025 10-K

305 paragraphs added · 321 removed · 238 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

49 edited+9 added−14 removed138 unchanged
Biggest changeGiven that cybersecurity threat actors are continuously adapting their techniques, it is important to note that no cybersecurity program is completely infallible. As we continue to offer new and innovative technologies for our customers, the risk of cybersecurity attacks and our oversight of this risk will remain at a high level. See "Item 1C.
Biggest changeAs we continue to offer new and innovative technologies for our customers, the risk of cybersecurity attacks and our oversight of this risk will remain at a high level. See "Item 1C. Cybersecurity." Climate Risk Management At this time, we have not experienced material losses from events related to climate change.
Effective September 30, 2020, the Federal Reserve finalized a rule that simplifies and increases the transparency of its rules for determining when one company controls another company for purposes of the BHCA and, on March 31, 2021, the Federal Reserve Board published interpretive guidance regarding the final rule and related regulatory control matters.
Effective September 30, 2020, the Federal Reserve Board finalized a rule that simplifies and increases the transparency of its rules for determining when one company controls another company for purposes of the BHCA and, on March 31, 2021, the Federal Reserve Board published interpretive guidance regarding the final rule and related regulatory control matters.
Specifically, that rule allows a non-QM loan or a "rebuttable presumption" QM loan to receive a safe harbor from APR liability at the end of a "seasoning" period of at least 36 months as a "seasoned QM" if it satisfies certain product restrictions, points-and-fees limits, and underwriting requirements, and the loan meets the designated performance and portfolio requirements during the "seasoning period." Integrated disclosures under the RESPA and the TILA - Under the CFPB rules, mortgage lenders are required to provide a loan estimate, not later than the third business day after submission of a loan application, and a closing disclosure at least three days prior to the loan closing.
Specifically, that rule allows a non-QM loan or a "rebuttable presumption" QM loan to receive a safe harbor from APR liability at the end of a "seasoning" period of at least 36 months as a "seasoned QM" if it 13 satisfies certain product restrictions, points-and-fees limits, and underwriting requirements, and the loan meets the designated performance and portfolio requirements during the "seasoning period." Integrated disclosures under the RESPA and the TILA - Under the CFPB rules, mortgage lenders are required to provide a loan estimate, not later than the third business day after submission of a loan application, and a closing disclosure at least three days prior to the loan closing.
The guidance, which covers all employees that have the ability to materially affect the risk profile of an organization, is based upon the key principles that a banking organization's incentive 17 compensation arrangements should (i) provide incentives that do not encourage risk-taking beyond the organization's ability to effectively identify and manage risks, (ii) be compatible with effective internal controls and risk management, and (iii) be supported by strong corporate governance, including active and effective oversight by the organization's board of directors.
The guidance, which covers all employees that have the ability to materially affect the risk profile of an organization, is based upon the key principles that a banking organization's incentive compensation arrangements should (i) provide incentives that do not encourage risk-taking beyond the organization's ability to effectively identify and manage risks, (ii) be compatible with effective internal controls and risk management, and (iii) be supported by strong corporate governance, including active and effective oversight by the organization's board of directors.
In general, these restrictions require that such transactions: (i) with the Corporation or any of its non-bank subsidiaries be limited to 10% of Fulton Bank's regulatory capital (20% in the aggregate to all such entities); (ii) satisfy certain qualitative limitations, including that any covered transaction be made on an arm's length basis; and (iii) in the case of extensions of credit, be secured by designated amounts of specified collateral.
In general, these restrictions require that such transactions: (i) with the Corporation or any of its non-bank subsidiaries be limited to 10% of Fulton Bank's regulatory capital (20% in the aggregate to all such entities); (ii) 15 satisfy certain qualitative limitations, including that any covered transaction be made on an arm's length basis; and (iii) in the case of extensions of credit, be secured by designated amounts of specified collateral.
As a financial holding company, the Corporation may also engage in or acquire and retain the shares of a company engaged in activities that are financial in nature or incidental or complementary to activities that are financial in nature as long as the Corporation continues to meet the eligibility requirements for financial holding companies, including that the Corporation and each of its U.S. depository institution subsidiaries remain "well-capitalized" and "well-managed." A depository institution is considered "well-capitalized" if it satisfies the requirements of the Prompt Corrective Action framework described above.
As a financial holding company, the Corporation may also engage in or acquire and retain the shares of a company engaged in activities that are financial in nature or incidental or complementary to activities that are financial in nature as long as the Corporation continues to meet the eligibility requirements for financial holding companies, including that the Corporation and each of its U.S. depository institution subsidiaries remain "well-capitalized" and "well-managed." 19 A depository institution is considered "well-capitalized" if it satisfies the requirements of the Prompt Corrective Action framework described above.
The CFPB is also authorized to prevent 12 any institution under its authority from engaging in an unfair, deceptive, or abusive act or practice in connection with consumer financial products and services. As a residential mortgage lender, we are subject to multiple federal consumer protection statutes and regulations, including, but not limited to, those statutes and regulations referenced above.
The CFPB is also authorized to prevent any institution under its authority from engaging in an unfair, deceptive, or abusive act or practice in connection with consumer financial products and services. As a residential mortgage lender, we are subject to multiple federal consumer protection statutes and regulations, including, but not limited to, those statutes and regulations referenced above.
In general, these statutes, regulations promulgated thereunder, and related interpretations establish the eligible business activities we can engage in, certain acquisition and merger restrictions, limitations on intercompany transactions (such as loans and dividends), cash reserve requirements, lending limitations, compliance with unfair, deceptive and abusive acts and practices prohibitions, limitations on 11 investments, and capital adequacy requirements, among other things.
In general, these statutes, regulations promulgated thereunder, and related interpretations establish the eligible business activities we can engage in, certain acquisition and merger restrictions, limitations on intercompany transactions (such as loans and dividends), cash reserve requirements, lending limitations, compliance with unfair, deceptive and abusive acts and practices prohibitions, limitations on investments, and capital adequacy requirements, among other things.
The first $16.9 million of otherwise reservable balances (subject to adjustment by the Federal Reserve Board) are exempt from the reserve requirements. Fulton Bank is in compliance with the foregoing requirements. Required reserves must be maintained in the form of either vault cash, an account at a FRB or a pass-through account as defined by the Federal Reserve Board.
The first $16.9 million of otherwise reservable balances (subject to adjustment by the Federal Reserve Board) are exempt from the reserve requirements. Fulton Bank is in compliance with the foregoing requirements. 18 Required reserves must be maintained in the form of either vault cash, an account at a FRB or a pass-through account as defined by the Federal Reserve Board.
Loans and Dividends from Bank Subsidiary - There are various restrictions on the extent to which Fulton Bank can make loans and other extensions of credit (including credit exposure arising from repurchase and reverse repurchase agreements, securities 15 borrowing and derivative transactions) to, or enter into certain transactions with, its affiliates, which includes the Corporation and its non-bank subsidiaries.
Loans and Dividends from Bank Subsidiary - There are various restrictions on the extent to which Fulton Bank can make loans and other extensions of credit (including credit exposure arising from repurchase and reverse repurchase agreements, securities borrowing and derivative transactions) to, or enter into certain transactions with, its affiliates, which includes the Corporation and its non-bank subsidiaries.
In accordance with the Dodd-Frank Act, the federal banking agencies prohibit incentive-based compensation arrangements that encourage inappropriate risk taking by covered financial institutions (generally institutions, like us, that have over $1 billion in assets) and are deemed to be excessive, or that may lead to material losses.
In accordance with the Dodd-Frank Act, the federal banking agencies prohibit incentive-based compensation arrangements that 17 encourage inappropriate risk taking by covered financial institutions (generally institutions, like us, that have over $1 billion in assets) and are deemed to be excessive, or that may lead to material losses.
The rate on excess balances will be set equal to the lowest target Federal Funds Rate in effect during the reserve maintenance period. On December 22, 2020, the Federal Reserve Board issued a final rule that amends Regulation D by lowering the reserve requirement ratios on transaction accounts maintained at depository institutions to 0%.
The rate on excess balances will be set equal to the lowest target Fed Funds Rate in effect during the reserve maintenance period. On December 22, 2020, the Federal Reserve Board issued a final rule that amends Regulation D by lowering the reserve requirement ratios on transaction accounts maintained at depository institutions to 0%.
In addition, the CFPB examines Fulton Bank for compliance with most federal consumer financial protection laws, including the laws relating to fair lending and prohibiting unfair, deceptive or abusive acts or practices in connection with the offer, sale or provision of consumer financial products or services and enforces such laws with respect to Fulton Bank and our affiliates.
In addition, the CFPB examines Fulton Bank for compliance with most federal consumer financial protection laws, including the laws relating to fair 11 lending and prohibiting unfair, deceptive or abusive acts or practices in connection with the offer, sale or provision of consumer financial products or services and enforces such laws with respect to Fulton Bank and our affiliates.
These reports, as well as any amendments thereto, are posted on our website as soon as reasonably practicable after they are electronically filed with the SEC. The information contained on our website or in any websites linked by our website is not a part of this Annual Report on Form 10-K.
These reports, as well as any amendments thereto, are posted on our website as soon as reasonably practicable after they are electronically filed with the SEC. The information contained on our website or in any websites linked by our website is not a part of this 2025 Annual Report on Form 10-K.
A reserve of 3% must be 18 maintained against aggregate transaction account balances of between $16.9 million and $127.5 million (subject to adjustment by the Federal Reserve Board) plus a reserve of 10% (subject to adjustment by the Federal Reserve Board within a range of between 8% and 14%) against that portion of total transaction account balances in excess of $127.5 million.
A reserve of 3% must be maintained against aggregate transaction account balances of between $16.9 million and $127.5 million (subject to adjustment by the Federal Reserve Board) plus a reserve of 10% (subject to adjustment by the Federal Reserve Board within a range of between 8% and 14%) against that portion of total transaction account balances in excess of $127.5 million.
Commercial lending products include commercial real estate loans, commercial and industrial loans and construction loans. Variable, adjustable and fixed rate loans are provided, with variable and adjustable rate loans generally tied to an index, such as the Prime Rate or SOFR, as well as interest rate derivatives.
Commercial lending products include commercial real estate loans, commercial and industrial loans and construction loans. Variable, adjustable and fixed rate loans 9 are provided, with variable and adjustable rate loans generally tied to an index, such as the Prime Rate or SOFR, as well as interest rate derivatives.
The Corporation has an additional 10 million authorized shares of preferred stock, of which approximately 200,000 shares with a liquidation preference of $1,000 per share were outstanding as of December 31, 2024. Supervision and Regulation We operate in an industry that is subject to laws and regulations that are enforced by a number of federal and state agencies.
The Corporation has an additional 10 million authorized shares of preferred stock, of which approximately 200,000 shares with a liquidation preference of $1,000 per share were outstanding as of December 31, 2025. Supervision and Regulation We operate in an industry that is subject to laws and regulations that are enforced by a number of federal and state agencies.
Safety, Health and Wellness - The safety, health and wellness of our employees is a top priority. In addition to healthcare, paid time off, paid parental leave and retirement benefits, we provide behavioral and mental health support and work-life services through our Employee Assistance Program. Cybersecurity Cybersecurity is a major component of our overall risk management approach.
Safety, Health and Wellness - The safety, health and wellness of our employees is a top priority. In addition to healthcare, paid time off, paid parental leave and retirement benefits, we provide behavioral and mental health support and work-life services through our Employee Assistance Program. Cybersecurity Cybersecurity is a critical component of our overall risk management approach.
The CRA also requires all institutions to make public disclosure of their CRA ratings. As of December 31, 2024, Fulton Bank was rated as "outstanding." Current regulations require that Fulton Bank publicly disclose certain agreements that are in fulfillment of CRA. Fulton Bank is not a party to any such agreements at this time.
The CRA also requires all institutions to make public disclosure of their CRA ratings. As of December 31, 2025, Fulton Bank was rated as "outstanding." Current regulations require that Fulton Bank publicly disclose certain agreements that are in fulfillment of CRA. Fulton Bank is not a party to any such agreements at this time.
Our consumer loan products also include automobile loans, student loans, personal loans and lines of credit and checking account overdraft protection. Commercial Banking - We provide commercial banking products and services primarily to small- and medium-sized businesses (generally with annual gross revenue of less than $150 million) in our market area.
Our consumer loan products also include automobile loans, student loans, personal loans and lines of credit and checking account overdraft protection. Commercial Banking - We provide commercial banking products and services primarily to small- and medium-sized businesses (generally with annual gross revenue of less than $500 million) in our market area.
We conduct an annual survey of our workforce to measure employee engagement, assess employee morale, and help identify areas of the employee experience that could be improved. We then task our leaders with developing and implementing communication and action plans to gain a better understanding of the results of the assessment and to foster enhanced future engagement.
We conduct an annual survey of our workforce to measure employee engagement and help identify areas of the employee experience that could be improved. We then task our leaders with developing and implementing communication and action plans to gain a better understanding of the results of the assessment and to foster enhanced future engagement.
As of December 31, 2024, the Corporation and Fulton Bank exceeded the minimum capital requirements, including the capital conservation buffer, as prescribed in the Basel III Rules. The Basel III Rules also provide that the largest banking institutions must adhere to additional countercyclical buffer and supplementary leverage ratio requirements.
As of December 31, 2025, the Corporation and Fulton Bank exceeded the minimum capital requirements, including the capital conservation buffer, as prescribed in the Basel III Rules. The Basel III Rules also provide that the largest banking institutions must adhere to additional countercyclical buffer and supplementary leverage ratio requirements.
Pursuant to the Emergency Economic Stabilization Act of 2008, the FRB pays interest on depository institutions' required and excess reserve balances. The interest rate paid on required reserve balances is currently the average target Federal Funds Rate over the reserve maintenance period.
Pursuant to the Emergency Economic Stabilization Act of 2008, the FRB pays interest on depository institutions' required and excess reserve balances. The interest rate paid on required reserve balances is currently the average target Fed Funds Rate over the reserve maintenance period.
The CFPB is responsible for promoting fairness and transparency for mortgages, credit cards, deposit accounts and other consumer financial products and services and for interpreting and enforcing the federal consumer financial laws that govern the provision of such products and services.
Consumer Financial Protection Laws and Enforcement - The CFPB is responsible for promoting fairness and transparency for mortgages, credit cards, deposit accounts and other consumer financial products and services and for interpreting and enforcing the federal consumer financial laws that govern the provision of such products and services.
The Federal Reserve will review, as part of the regular, risk-focused examination process, the incentive compensation arrangements of banking organizations, such as the Corporation, that are not "large, complex banking organizations." These reviews will be tailored to each organization based on the scope and complexity of the organization's activities and the prevalence of incentive compensation arrangements.
The FRB will review, as part of the regular, risk-focused examination process, the incentive compensation arrangements of banking organizations, such as the Corporation, that are not "large, complex banking organizations." These reviews will be tailored to each organization based on the scope and complexity of the organization's activities and the prevalence of incentive compensation arrangements.
As of December 31, 2024, Fulton Bank's capital ratios were above the minimum levels required to be considered "well capitalized" by the OCC.
As of December 31, 2025, Fulton Bank's capital ratios were above the minimum levels required to be considered "well capitalized" by the OCC.
Electronic copies of our 2024 Annual Report on Form 10-K are available free of charge by visiting "Investor Relations - Documents" at www.fultonbank.com . Electronic copies of Quarterly Reports on Form 10-Q and Current Reports on Form 8-K are also available at this Internet address.
Electronic copies of our 2025 Annual Report on Form 10-K are available free of charge by visiting "Investor Relations - Financials" at www.fultonbank.com . Electronic copies of Quarterly Reports on Form 10-Q and Current Reports on Form 8-K are also available at this Internet address.
The impact of Basel IV on the Corporation and Fulton Bank will depend on the manner in which it is implemented by the federal banking agencies. As of December 31, 2024, the 14 Corporation and Fulton Bank exceeded all capital requirements necessary to be deemed "well-capitalized" for all regulatory purposes under the U.S. capital rules.
The impact of Basel IV on the Corporation and Fulton Bank will depend on the manner in which it is implemented by the federal banking agencies. As of December 31, 2025, the Corporation and Fulton Bank exceeded all capital requirements necessary to be deemed "well-capitalized" for all regulatory purposes under the Capital Rules.
The Economic Growth Act also enacted other important changes, for which the banking agencies issued certain corresponding guidance documents and implementing regulations, including: • Raising the total asset threshold for Dodd-Frank Act company-run stress tests from $10 billion to $250 billion; • Prohibiting federal banking agencies from imposing higher capital requirements for high volatility commercial real estate exposures unless such exposures meet the statutory definition for high volatility acquisition, development or construction loans in the Economic Growth Act; • Exempting from appraisal requirements certain transactions involving real property in rural areas and valued at less than $400,000; • Providing that reciprocal deposits are not treated as brokered deposits in the case of a "well capitalized" institution that received an "outstanding" or "good" rating on its most recent examination to the extent the amount of such deposits does not exceed the lesser of $5 billion or 20% of the bank's total liabilities; and • Directing the CFPB to provide guidance on the applicability of the TILA-RESPA Integrated Disclosure rule to mortgage assumption transactions and construction-to-permanent home loans, as well the extent to which lenders can rely on model disclosures that do not reflect recent regulatory changes.
The Economic Growth Act also enacted other important changes, for which the banking agencies issued certain corresponding guidance documents and implementing regulations, including: • Raising the total asset threshold for Dodd-Frank Act company-run stress tests from $10 billion to $250 billion; • Prohibiting federal banking agencies from imposing higher capital requirements for high volatility commercial real estate exposures unless such exposures meet the statutory definition for high volatility acquisition, development or construction loans in the Economic Growth Act; • Exempting from appraisal requirements certain transactions involving real property in rural areas and valued at less than $400,000; • Providing that reciprocal deposits are not treated as brokered deposits in the case of a "well capitalized" institution that received an "outstanding" or "good" composite condition rating on its most recent examination to the extent the amount of such deposits does not exceed the lesser of $5 billion or 20% of the bank's total liabilities; and • Directing the CFPB to provide guidance on the applicability of the TILA-RESPA Integrated Disclosure rule to mortgage assumption transactions and construction-to-permanent home loans, as well the extent to which lenders can rely on model disclosures that do not reflect recent regulatory changes. 12 Given Fulton Bank's size, a number of additional benefits afforded to community banks under applicable asset thresholds are not available to Fulton Bank.
As of December 31, 2024, we had 216 financial centers, not including remote service facilities (mainly stand-alone ATMs), and our main office located in Lancaster, Pennsylvania. Human Capital Our workforce, excluding temporary employees and interns, consisted of approximately 3,400 employees, at December 31, 2024 and December 31, 2023.
As of December 31, 2025, we had 204 financial centers, not including remote service facilities (mainly stand-alone ATMs), and our main office located in Lancaster, Pennsylvania. Human Capital Our workforce, excluding temporary employees and interns, consisted of approximately 3,400 employees, at December 31, 2025.
Stock Information The Corporation's common stock is traded on the Nasdaq Global Select Market under the ticker symbol "FULT." There are 600 million authorized shares of the Corporation's common stock, with approximately 182 million shares outstanding as of December 31, 2024.
Stock Information The Corporation's common stock is traded on the Nasdaq Global Select Market under the ticker symbol "FULT." There are 600 million authorized shares of the Corporation's common stock, with approximately 180 million shares outstanding as of December 31, 2025.
Among other requirements, the Patriot Act and related regulations impose the following requirements on financial institutions: • establishment of AML programs; • establishment of a program specifying procedures for obtaining identifying information from customers seeking to open new accounts, including verifying the identity of customers within a reasonable period of time; • establishment of enhanced due diligence policies, procedures and controls designed to detect and report money laundering; and 16 • prohibition on correspondent accounts for foreign shell banks and compliance with recordkeeping obligations with respect to correspondent accounts of foreign banks.
Among other requirements, the Patriot Act and related regulations impose the following requirements on financial institutions: • establishment of AML programs; • establishment of a program specifying procedures for obtaining identifying information from customers seeking to open new accounts, including verifying the identity of customers within a reasonable period of time; • establishment of enhanced due diligence policies, procedures and controls designed to detect and report money laundering; and • prohibition on correspondent accounts for foreign shell banks and compliance with recordkeeping obligations with respect to correspondent accounts of foreign banks. 16 Failure to comply with the requirements of the Patriot Act and other AML laws and regulations could have serious legal, financial, regulatory and reputational consequences.
On April 26, 2024, the Corporation consummated the Republic First Transaction. On July 1, 2022, the Corporation completed our acquisition of 100% of the outstanding common stock of Prudential Bancorp. Prudential Bancorp's wholly-owned subsidiary, Prudential Bank, became our wholly-owned subsidiary. Prudential Bank merged with and into Fulton Bank on November 5, 2022. Our Internet address is www.fultonbank.com .
On July 1, 2022, the Corporation completed the acquisition of 100% of the outstanding common stock of Prudential Bancorp. Prudential Bancorp's wholly-owned subsidiary, Prudential Bank, became our wholly-owned subsidiary. Prudential Bank merged with and into Fulton Bank on November 5, 2022. Our Internet address is www.fultonbank.com .
We deliver these products and services through a network of financial center locations. Electronic delivery channels include a network of ATMs and telephone, mobile and online banking. The variety of available delivery channels allows customers to access their account information and perform certain transactions, such as depositing checks, transferring funds and paying bills, at any time of the day.
Electronic delivery channels include a network of ATMs and telephone, mobile and online banking. The variety of available delivery channels allows customers to access their account information and perform certain transactions, such as depositing checks, transferring funds and paying bills, at any time of the day.
The following discussion is general in nature and seeks to highlight some of the more significant regulatory requirements to which we are subject but does not purport to be complete or to describe all applicable laws and regulations.
The following discussion is general in nature and seeks to highlight some of the more significant regulatory requirements to which we are subject but does not purport to be complete or to describe all applicable laws and regulations. The descriptions are qualified in their entirety by reference to the relevant statutes and regulations.
In certain circumstances, repurchases of our common stock may be subject to a prior approval or notice requirement under other regulations or policies of the Federal Reserve Board. Any redemption or repurchase of preferred stock or subordinated debt remains subject to the prior approval of the Federal Reserve Board.
In certain circumstances, repurchases of our common stock may be subject to a prior approval or notice requirement under other regulations or policies of the Federal Reserve Board.
As such, we maintain a comprehensive cybersecurity strategy that includes, but is not limited to: regular employee cybersecurity training and communications; continuous monitoring, detection, alerting, and defense in-depth technologies; regular internal and third-party program oversight; policies and procedures regularly reviewed and designed with regulatory and industry guidance; and regular reviews of vendors who maintain sensitive data on behalf of Fulton Bank.
As such, we maintain a comprehensive cybersecurity strategy that includes, but is not limited to: regular employee cybersecurity training and communications; continuous monitoring, detection, alerting, and defense-in-depth technologies; regular internal and third-party program oversight; policies and procedures regularly reviewed and designed with regulatory and industry guidance; and regular reviews of vendors who maintain sensitive data on behalf of Fulton Bank. 10 Given that cybersecurity threat actors are continuously adapting their techniques, it is important to note that no cybersecurity program is completely infallible.
The Basel Committee published the last version of the Basel III accord in 2017, generally referred to as "Basel IV." Among other things, these standards revise the Basel Committee's standardized approach for credit risk (including by recalibrating risk weights and introducing new capital requirements for certain "unconditionally cancellable commitments," such as unused credit card and home equity lines of credit) and provides a new standardized approach for operational risk capital.
Any redemption or repurchase of preferred stock or subordinated debt remains subject to the prior approval of the Federal Reserve Board. 14 The Basel Committee published the last version of the Basel III accord in 2017, generally referred to as "Basel IV." Among other things, these standards revise the Basel Committee's standardized approach for credit risk (including by recalibrating risk weights and introducing new capital requirements for certain "unconditionally cancellable commitments," such as unused credit card and home equity lines of credit) and provides a new standardized approach for operational risk capital.
The amended control rule has had, and will likely continue to have, a meaningful impact on control determinations related to investments in banks and bank holding companies and investments by bank holding companies in nonbank companies. 19 Permissible Activities — As a bank holding company, the Corporation may engage in the business of banking, managing or controlling banks, performing servicing activities for subsidiaries, and engaging in activities that the Federal Reserve Board has determined, by order or regulation, are so closely related to banking as to be a proper incident thereto.
Permissible Activities - As a bank holding company, the Corporation may engage in the business of banking, managing or controlling banks, performing servicing activities for subsidiaries, and engaging in activities that the Federal Reserve Board has determined, by order or regulation, are so closely related to banking as to be a proper incident thereto.
Our commercial lending policy encourages relationship banking and provides guidelines related to customer creditworthiness and collateral requirements for secured loans. We offer equipment lease financing, letters of credit, cash management services and traditional deposit products to commercial customers.
Our commercial lending policy encourages relationship banking and provides guidelines related to customer creditworthiness and collateral requirements for secured loans. We offer equipment lease financing, letters of credit, cash management services and traditional deposit products to commercial customers. We have established lending limits based on our internal risk rating of a borrower and for certain types of lending commitments.
The closing disclosure must include, among other things, closing costs and a comparison of costs reported on the loan estimate to actual charges to be applied at closing. 13 Volcker Rule - Provisions of the Dodd-Frank Act, commonly known as the "Volcker Rule," prohibit banks and their affiliates from engaging in proprietary trading and investing in and sponsoring hedge funds and private equity funds and other private funds that are, among other things, offered within specified exemptions to the Investment Company Act, known as "covered funds," subject to certain exemptions.
Volcker Rule - Provisions of the Dodd-Frank Act, commonly known as the "Volcker Rule," prohibit banks and their affiliates from engaging in proprietary trading and investing in and sponsoring hedge funds and private equity funds and other private funds that are, among other things, offered within specified exemptions to the Investment Company Act, known as "covered funds," subject to certain exemptions.
Cybersecurity." Climate Risk Management At this time, we have not experienced material losses from climate change. However, we are aware that its impact may increase in the future. We recognize the potential impact climate change may have on us, our clients, our suppliers, employees, 10 shareholders, and the communities we serve.
However, we are aware that its impact may increase in the future. We recognize the potential impact climate change may have on us, our clients, our suppliers, employees, shareholders, and the communities we serve.
The Federal Reserve Board continues to supervise our capital planning and risk management practices through its regular supervisory process which includes regular stress testing.
The Federal Reserve Board continues to supervise our capital planning and risk management practices through its regular supervisory process which includes regular stress testing. Prompt Corrective Action - The FDICIA established a system of prompt corrective action to attempt to resolve the problems of undercapitalized institutions.
The loan estimate must detail the terms of the loan, including, among other things, expenses, projected monthly mortgage payments and estimated closing costs.
The loan estimate must detail the terms of the loan, including, among other things, expenses, projected monthly mortgage payments and estimated closing costs. The closing disclosure must include, among other things, closing costs and a comparison of costs reported on the loan estimate to actual charges to be applied at closing.
On September 17, 2024, the FDIC, the OCC and the DOJ, each announced new rules and policy statements impacting their bank merger review processes. Among these actions, the FDIC approved a final statement of policy on bank merger transactions and the OCC approved a final rule updating the agency's regulations for business combinations involving national banks and federal savings associations.
Among these actions, the FDIC approved a final statement of policy on bank merger transactions and the OCC approved a final rule updating the agency's regulations for business combinations involving national banks and federal savings associations, both of which expressed heightened scrutiny of business combinations.
Under this limited exception, qualified IDIs, like Fulton Bank, are able to except from treatment as "brokered" deposits the lesser of up to $5 billion, or 20% of the institution's total liabilities, in reciprocal deposits. On July 30, 2024, the FDIC issued a proposed rule that would significantly revise the existing brokered deposits regulation as outlined above.
Under this limited exception, qualified IDIs, like Fulton Bank, are able to exempt from treatment as "brokered" deposits the lesser of up to $5 billion, or 20% of the institution's total liabilities, in reciprocal deposits.
We have established lending limits based on our internal risk rating of a borrower and for certain types of lending commitments. 9 Wealth Management - We offer wealth management services, which include investment management, trust, brokerage, insurance and investment advisory services, to consumer and commercial customers in our market area through Fulton Financial Advisors and Fulton Private Bank, both operating divisions of Fulton Bank.
Wealth Management - We offer wealth management services, which include investment management, trust, brokerage, insurance and investment advisory services, to consumer and commercial customers in our market area through Fulton Financial Advisors and Fulton Private Bank, both operating divisions of Fulton Bank. We deliver these products and services through a network of financial center locations.
Failure to comply with the requirements of the Patriot Act and other AML laws and regulations could have serious legal, financial, regulatory and reputational consequences. In addition, bank regulators will consider a bank holding company's effectiveness in combating money laundering when ruling on BHCA and BMA applications.
In addition, bank regulators will consider a bank holding company's effectiveness in combating money laundering when ruling on BHCA and BMA applications.
On October 24, 2023, the federal regulatory agencies jointly issued a final rule to strengthen and modernize regulations implementing the CRA. On March 29, 2024, a federal district court in Texas granted a preliminary injunction barring implementation of the final rule in response to a lawsuit filed by several trade groups. We will continue to monitor the litigation until resolved.
On October 24, 2023, the federal regulatory agencies jointly issued a final rule to strengthen and modernize regulations implementing the CRA, but in light of litigation, the agencies issued a joint proposal in July 2025 to rescind this rule and reinstate the CRA framework that existed prior to the 2023 final rule.
Removed
Given Fulton Bank's size, a number of additional benefits afforded to community banks under applicable asset thresholds are not available to Fulton Bank. Consumer Financial Protection Laws and Enforcement - The CFPB and the federal banking agencies continue to focus attention on consumer protection laws and regulations.
Added
On November 24, 2025, the Corporation entered into the Merger Agreement with Blue Foundry. Under the terms of the Merger Agreement, Blue Foundry will merge with and into the Corporation, with the Corporation continuing as the surviving corporation.
Removed
CECL Transitional Provisions – On August 26, 2020, the federal bank regulatory agencies adopted the CECL Transition Rule that provides banking institutions an optional five-year transition period to phase in the impact of the CECL standard on their regulatory capital.
Added
The combined company will operate under the Corporation's name and will trade under the ticker symbol "FULT." Shareholders of Blue Foundry approved the Merger at the Blue Foundry special shareholder meeting on January 29, 2026, and all regulatory approvals required to complete the Merger have been obtained.
Removed
The final rule gives eligible institutions the option to mitigate the estimated capital effects of CECL for two years, followed by a three-year transition period. Taken together, these measures offer institutions a transition period of up to five years. We have elected to avail ourselves of the transition relief permitted under applicable regulations.
Added
Subject to the satisfaction of the remaining customary closing conditions in the Merger Agreement, we expect the Merger to close on or about April 1, 2026. Blue Foundry Bank is expected to be merged with and into Fulton Bank in the third quarter of 2026. On April 26, 2024, Fulton Bank completed the Republic First Transaction.
Removed
Prompt Corrective Action - The FDICIA established a system of prompt corrective action to attempt to resolve the problems of undercapitalized institutions.
Added
The FDIC approved an interim final rule in December 2025 to reduce the special assessment for the eighth collection quarter to 2.97 bps. The interim final rule aims to ensure the FDIC will collect the exact amount needed through the special assessment to match the total losses preventing either over-or under-collection.
Removed
Among other things, the proposed rule would broaden the scope of deposits that IDIs would be required to classify as brokered and narrow the exception to the definition of the term “deposit broker,” which would result in more deposits being classified as brokered deposits.
Added
The interim final rule also requires the FDIC to provide an offset to regular quarterly deposit insurance assessments for banks subject to the special assessment if the aggregate amount collected exceeds losses following the final resolution of litigation between the FDIC and one of the bank entities.
Removed
As a result of the change in the U.S. presidential administration, and based on recent statements from the new Acting Chairman of the FDIC, the proposed rule is unlikely to be adopted as proposed and the prospects and timing for any re-proposal or supervisory action in this area remain uncertain at this time.
Added
On September 17, 2024, the FDIC, the OCC and the DOJ, each announced new rules and policy statements impacting their bank merger review processes under the BMA.
Removed
As a result of this final rule, we accrued $6.5 million ($5.1 million after tax) related to this assessment in the fourth quarter of 2023. This amount represents our current expectation of the full amount of the assessment based on our total uninsured deposits as of December 31, 2022.
Added
In May 2025, the FDIC rescinded its 2024 policy statement on bank merger review and reinstated its prior Statement of Policy on Bank Merger Transactions and the OCC adopted an interim final rule amending the 2024 final rule to restore the expedited review and the use of the streamlined business combination application. The OCC also rescinded its 2024 policy statement.
Removed
Under the final rule, the estimated losses to the DIF may be revised from time to time, and the FDIC has retained the ability to cease collection early, extend the special assessment collection period and impose a final shortfall special assessment on a one-time basis.
Added
President Trump subsequently signed a joint resolution under the Congressional Review Act, which, among other things, prevents an agency from reissuing a substantially similar rule.
Removed
We have also begun efforts to evaluate the impact of the new rule and develop a strategy to ensure compliance.
Added
The amended control rule has had, and will likely continue to have, a meaningful impact on control determinations related to investments in banks and bank holding companies and investments by bank holding companies in nonbank companies.
Removed
The OCC's final rule modifies its procedures for reviewing bank merger applications under the BMA applications, including the elimination of the expedited bank merger review and the streamlined application procedures.
Removed
The OCC's final rule also includes a new policy statement that addresses the substantive standards that it will use to evaluate bank merger applications, including indicators that point in favor of likely approval or rejection.
Removed
The FDIC's statement of policy adopts a principles-based approach and clarifies its policies and expectations in the evaluation of bank merger transactions subject to FDIC approval under the BMA.
Removed
However, Acting FDIC Chairman Travis Hill has indicated the possibility of withdrawing the new statement of policy, and it is unclear whether the OCC under anticipated new leadership will reconsider its new regulation and policy statement.
Removed
Concurrent with the FDIC and OCC announcements, the DOJ withdrew from its 1995 Bank Merger Guidelines and announced that it would consider bank mergers under its 2023 Merger Guidelines, which are not industry specific, as well as under a separate, recently adopted bank merger addendum.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

58 edited+30 added−18 removed124 unchanged
Biggest changeAs a result, we may have to increase our provision for credit losses, which would negatively impact our results of operations, and could result in charge-offs of a higher percentage of our loans. Unlike large, national institutions, we are not able to spread the risks of unfavorable local economic conditions across a large number of diversified economies and geographic locations.
Biggest changeWorsening economic conditions, such as economic downturns, recessions, increases in prevailing interest rates and high unemployment rates, could negatively impact the quality of our loan portfolio. As a result, we may have to increase our provision for credit losses, which would negatively impact our results of operations, and could result in charge-offs of a higher percentage of our loans.
Commercial loans, commercial mortgage loans and construction loans generally involve a greater degree of credit risk than residential mortgage loans and consumer loans because these loans are likely to be more sensitive to broader economic factors and conditions.
Commercial loans, commercial mortgage loans and residential and commercial construction loans generally involve a greater degree of credit risk than residential mortgage loans and consumer loans because these loans are likely to be more sensitive to broader economic factors and conditions.
Even if required approvals are obtained, acquisitions involve numerous risks, including lower than expected performance, higher than expected costs, difficulties related to integration, diversion of management's attention from other business activities, the potential loss of key employees, changes in relationships with customers, disruption of the operations of the acquired business and our business, exposure to potential asset quality issues and unknown or contingent liabilities of the acquired business and changes in banking or tax laws or regulations that may affect the acquired business.
Even if required approvals are obtained, acquisitions involve numerous risks, including lower than expected performance, higher than expected costs, difficulties related to integration, diversion of management's attention from other business activities, the potential loss of key employees, changes in relationships with customers, disruption of the operations of the acquired business and our business, exposure to potential asset quality issues, unknown or contingent liabilities of the acquired business and changes in banking or tax laws or regulations that may affect the acquired business and our business.
The financial services industry has become even more competitive as a result of legislative, regulatory, and technological changes and continued banking consolidation, which may increase in connection with current economic, market, and political conditions. We face substantial competition in all phases of our operations from a variety of competitors, including national 30 banks, regional banks, community banks and FinTechs.
The financial services industry has become even more competitive as a result of legislative, regulatory, and technological changes and continued banking consolidation which may increase in connection with current economic, market, and political conditions. We face substantial competition in all phases of our operations from a variety of competitors, including national banks, regional banks, community banks and FinTechs.
Our large transaction volume and necessary dependence upon automated systems to record and process these transactions results in the risk that technical flaws, tampering, or manipulation of those automated systems, arising from events wholly or partially beyond our control, and may give rise to 24 disruption of service to customers and to financial loss or liability.
Our large transaction volume and necessary dependence upon automated systems to record and process these transactions results in the risk that technical flaws, tampering, or manipulation of those automated systems, arising from events wholly or partially beyond our control, and may give rise to disruption of service to customers and to financial loss or liability.
Compliance with current or future privacy, data protection and information security laws could result in higher compliance and technology costs and could restrict our ability to provide certain products and services that could materially and adversely affect our profitability. We are subject to a variety of risks in connection with the origination and sale of loans.
Compliance with current or future privacy, data protection and information security laws could result in higher compliance and technology costs and could restrict our ability to provide certain products and services that could materially and adversely affect our profitability. 25 We are subject to a variety of risks in connection with the origination and sale of loans.
Unfavorable or uncertain economic and market conditions can be caused by: declines in economic growth, business activity or investor or business confidence; limitations on the availability, or increases in the cost, of credit and capital; changes in the rate of inflation or in interest rates; high unemployment; labor shortages; governmental fiscal and monetary policies; the level of, or changes in, prices of raw materials, goods or commodities; supply chain issues; global economic conditions; immigration policies; trade policies and tariffs affecting other countries as well as retaliatory policies and tariffs by such countries; geopolitical events, including the war between Russia and Ukraine and the ongoing conflict in the Middle East; natural disasters; public health crises, such as epidemics and pandemics; acts of war or terrorism; or a combination of these or other factors.
Unfavorable or uncertain economic and market conditions can be caused by: declines in economic growth, business activity or investor or business confidence; limitations on the availability, or increases in the cost, of credit and capital; changes in the rate of inflation or in interest rates; high unemployment; labor shortages; governmental fiscal and monetary policies; the level of, or changes in, prices of raw materials, goods or commodities; supply chain issues; global economic conditions; immigration policies; trade policies and tariffs affecting other countries as well as retaliatory policies and tariffs by such countries; geopolitical events, including the war between Russia and Ukraine and ongoing tensions in the Middle East; natural disasters; public health crises, such as epidemics and pandemics; acts of war or terrorism; or a combination of these or other factors.
Notification to the Federal Reserve is also required prior to our declaring and paying a cash dividend to our shareholders during any period in which our quarterly and/or cumulative twelve-month net earnings are insufficient to fund the dividend amount, among other requirements.
Notification to the Federal Reserve Board is also required prior to our declaring and paying a cash dividend to our shareholders during any period in which our quarterly and/or cumulative twelve-month net earnings are insufficient to fund the dividend amount, among other requirements.
Failure to comply with these regulatory requirements, including inadvertent or unintentional 27 violations, may result in the assessment of fines and penalties, the commencement of informal or formal regulatory enforcement actions against us, or regulatory restrictions on our activities.
Failure to comply with these regulatory requirements, including inadvertent or unintentional violations, may result in the assessment of fines and penalties, the commencement of informal or formal regulatory enforcement actions against us, or regulatory restrictions on our activities.
These law changes may be retroactive to previous periods and, as a result, could negatively affect our current and future financial performance. The Tax Act reduced our federal corporate income tax rate to 21% beginning in 2018.
These changes may be retroactive to previous periods and, as a result, could negatively affect our current and future financial performance. The Tax Act reduced our federal corporate income tax rate to 21% beginning in 2018.
Any failure or circumvention of our controls and procedures or failure to comply with regulations related to controls and procedures could have a material adverse effect on our business, financial condition or results of operations. See "Item 9A.
Any failure or circumvention of our controls and procedures or failure to comply with regulations related 24 to controls and procedures could have a material adverse effect on our business, financial condition or results of operations. See "Item 9A.
Although we maintain insurance coverage that may, subject 25 to policy terms and conditions, cover certain aspects of cyber risks, our insurance coverage may be inapplicable or otherwise insufficient to cover any or all losses.
Although we maintain insurance coverage that may, subject to policy terms and conditions, cover certain aspects of cyber risks, our insurance coverage may be inapplicable or otherwise insufficient to cover any or all losses.
We are subject to various federal and state privacy, information security, and data protection laws, such as the GLBA, that among other things require privacy disclosures and maintenance of a robust security program that are increasingly subject to change which could have a significant impact on our current and planned privacy, data protection, and information security-related practices; our collection, use, sharing, retention, and safeguarding of consumer or employee information; disclosures and notifications during a cyber or information security incident; and some of our current or planned business activities.
We are subject to various federal and state privacy, information security, and data protection laws, such as the GLBA, that among other things require privacy disclosures and maintenance of a robust security program that are increasingly subject to change which could have a significant impact on our current and planned privacy, data protection, and information security-related practices; our collection, use, sharing, retention, and safeguarding of consumer or employee information; disclosures and notifications during a cyber or information security incident; and certain of our current or planned business activities.
We may not pay a dividend if the Federal Reserve objects or until such time as we receive approval from the Federal Reserve or we no longer need to provide notice under applicable regulations.
We may not pay a dividend if the Federal Reserve Board objects or until such time as we receive approval from the Federal Reserve Board or we no longer need to provide notice under applicable regulations.
A reduction or discontinuance of dividends on our common stock or our share repurchases could have a material adverse effect on the market price of our common stock. Item 1B. Unresolved Staff Comments None.
A reduction or discontinuance of dividends on our common stock or our share repurchases could have a material adverse effect on the market price of our common stock. 32 Item 1B. Unresolved Staff Comments None.
We are not required to pay dividends on, or effect repurchases of, our common stock and may reduce or eliminate our common stock 31 dividend and/or share repurchases in the future.
We are not required to pay dividends on, or effect repurchases of, our common stock and may reduce or eliminate our common stock dividend and/or share repurchases in the future.
Our ability to pay dividends to our stockholders is subject to the restrictions set forth in Pennsylvania law, by the Federal Reserve, and by certain covenants contained in our subordinated debentures.
Our ability to pay dividends to our stockholders is subject to the restrictions set forth in Pennsylvania law, by the Federal Reserve Board, and by certain covenants contained in our subordinated debentures.
Thus, changes in 21 market interest rates might, for example, result in a decrease in the interest earned on interest-earning assets that is not accompanied by a corresponding decrease in the interest paid on interest-bearing liabilities, or the decrease in interest paid on interest-bearing liabilities might be at a slower pace, or in a smaller amount, than the decrease in interest earned on interest-earning assets, reducing our net interest income and/or net interest margin.
Thus, changes in market interest rates might, for example, result in a decrease in the interest earned on interest-earning assets that is not accompanied by a corresponding decrease in the interest paid on interest-bearing liabilities, or the decrease in interest paid on interest-bearing liabilities might be at a slower pace, or in a smaller amount, than the decrease in interest earned on interest-earning assets, 21 reducing our net interest income and/or NIM.
Under this framework, regulatory agencies have broad authority to carry out their supervisory, examination and enforcement responsibilities to address compliance with applicable laws and regulations, including laws and regulations relating to capital adequacy, asset quality, earnings, liquidity, risk management and financial accounting and reporting as well as laws and regulations governing consumer protection, fair lending, privacy, information security and cybersecurity risk management, third-party vendor risk management, AML and sanctions and anti-terrorism laws.
Under this framework, regulatory agencies have broad authority to carry out their supervisory, examination and enforcement responsibilities to address compliance with applicable laws and regulations, including, but not limited to, laws and regulations relating to capital adequacy, asset quality, earnings, liquidity, risk management and financial accounting and reporting as well as laws and regulations governing consumer protection, fair lending, privacy, information security and cybersecurity risk management, third-party vendor risk management, AML and sanctions and anti-terrorism laws.
Changes to the Tax Code may affect our business, financial condition and results of operations. 28 Regulations relating to privacy, information security, and data protection could increase our costs, affect or limit how we collect and use personal information, and adversely affect our business opportunities.
Future changes to the Tax Code may affect our business, financial condition and results of operations. Regulations relating to privacy, information security, and data protection could increase our costs, affect or limit how we collect and use personal information and adversely affect our business opportunities.
Further, deposits from state and municipal entities, primarily in non-maturing, interest-bearing accounts, are a significant source of deposit funding for us, representing approximately 13% of total deposits at December 31, 2024.
Further, deposits from state and municipal entities, primarily in non-maturing, interest-bearing accounts, are a significant source of deposit funding for us, representing approximately 13% of total deposits at December 31, 2025.
Acquisitions may dilute shareholder value. Future mergers or acquisitions, if any, may involve cash, debt or equity securities as transaction consideration. Acquisitions typically involve the payment of a premium over book and market values, and, therefore, some dilution of our stock's tangible book value and net income per common share may occur in connection with any future transaction.
Additionally, future mergers or acquisitions, if any, may involve cash, debt or equity securities as transaction consideration. Acquisitions typically involve the payment of a premium over book and market values, and, therefore, some dilution of our stock's tangible book value and net income per common share may occur in connection with any future transaction.
Virtually every aspect of our operations is subject to extensive regulation and supervision by federal and state regulatory agencies, including the Federal Reserve Board, OCC, FDIC, CFPB, DOJ, UST, SEC, HUD, DOL, EEOC, state attorneys general and state banking, financial services, securities and insurance regulators.
Virtually every aspect of our operations is subject to extensive regulation and supervision by federal and state regulatory agencies, including, but not limited to, the Federal Reserve Board, OCC, FDIC, CFPB, DOJ, UST, SEC, HUD, DOL, EEOC, state attorneys general and state banking, financial services, securities and insurance regulators.
Actual results could differ from these estimates. Material estimates subject to change in the near term include, among other items: the allowance for credit losses; the carrying value of goodwill or other intangible assets; the fair value estimates of certain assets and liabilities; and the realization of deferred tax assets and liabilities.
Actual results could differ from these estimates. Material estimates subject to change in the near term include, among other items: the allowance for credit losses; the carrying value of goodwill or other intangible assets; the fair value estimates of certain assets and liabilities; and the realization of DTAs and liabilities.
A failure to follow applicable regulatory guidance in this area could expose us to regulatory sanctions. The commercial soundness of many financial institutions may be closely interrelated as a result of credit, trading, execution of transactions or other relationships between the institutions.
A failure to follow applicable regulatory guidance in this area could expose us to regulatory sanctions. The commercial soundness of many financial institutions are closely interrelated as a result of credit, trading, execution of transactions or other relationships between the institutions.
Any of these operational or other risks could result in our diminished ability to operate one or more of our businesses, financial loss, potential liability to customers, inability to secure insurance, reputational damage and regulatory intervention and could materially adversely affect our business, financial condition and results of operations. 26 Climate change may materially adversely affect our business and results of operations.
Any of these operational or other risks could result in our diminished ability to operate one or more of our businesses, financial loss, potential liability to customers, inability to secure insurance, reputational damage and regulatory intervention and could materially adversely affect our business, financial condition and results of operations.
Our business plan includes the pursuit of profitable growth. To achieve profitable growth, we may pursue new lines of business or offer new products or services, all of which can involve significant costs, uncertainties and risks. Any new activity we pursue may require a significant investment of time and resources and may not generate the anticipated return on that investment.
To achieve profitable growth, we may pursue new lines of business or offer new products or services, all of which can involve significant costs, uncertainties and risks. Any new activity we pursue may require a significant investment of time and resources and may not generate the anticipated return on that investment.
In addition, we are dependent on lower-cost, core deposits as our primary source of funding and changes in interest rates could increase our cost of funding, reduce our net interest margin and/or create liquidity challenges.
In addition, we are dependent on lower-cost, core deposits as our primary source of funding and changes in interest rates could increase our cost of funding, reduce our NIM and/or create liquidity challenges.
As a result of elevated interest rates in recent years, the fair value of our AFS investment securities declined resulting in unrealized losses of approximately $276 million as of December 31, 2024 and is reflected in AOCI as a reduction to total shareholders' equity.
As a result of elevated interest rates in recent years, the fair value of our AFS investment securities declined resulting in unrealized losses of approximately $206 million as of December 31, 2025 and is reflected in AOCI as a reduction to total shareholders' equity.
A significant proportion of our loan portfolio consists of commercial mortgage loans that may pose increased credit risk. At December 31, 2024, commercial mortgage loans represented approximately 40% of our loan portfolio. These loans are secured by both owner-occupied and non-owner-occupied commercial real estate.
A significant proportion of our loan portfolio consists of commercial mortgage loans that may pose increased credit risk. At December 31, 2025, commercial mortgage loans represented approximately 41% of our loan portfolio. These loans are secured by both owner-occupied and non-owner-occupied commercial real estate.
Potential acquisitions are typically subject to regulatory or other approvals, and there can be no assurance that we would be able to obtain any such approvals in a timely manner, without restrictive conditions or at all.
Potential acquisitions, including the pending Merger, are typically subject to regulatory or other approvals, and there can be no assurance that we would be able to obtain any such approvals in a timely manner, without restrictive conditions or at all.
Changes in market interest rates, in the shape of the yield curve or in spreads between different market interest rates can have a material effect on our net interest margin.
Changes in market interest rates, in the shape of the yield curve or in spreads between different market interest rates can have a material effect on our NIM.
Net interest income is the difference between interest earned on interest-earning assets and interest paid on interest-bearing liabilities. Net interest income is the most significant component of our net income, accounting for approximately 78% of total revenues in 2024.
Net interest income is the difference between interest earned on interest-earning assets and interest paid on interest-bearing liabilities. Net interest income is the most significant component of our net income, accounting for approximately 79% of total revenues in 2025.
Efforts to reform government sponsored enterprises and agencies, changes in the types of, or standards for, loans purchased by government sponsored enterprises or agencies and other investors, or our failure to maintain our status as an eligible seller of such loans may limit our ability to sell these loans.
Efforts to reform GSEs, changes in the types of, or standards for, loans purchased by GSEs and other investors, or our failure to maintain our status as an eligible seller of such loans may limit our ability to sell these loans.
We have dedicated significant time, effort, and expense over time to comply with regulatory and supervisory standards and requirements imposed by our regulators, and we expect that we will continue to do so.
We dedicate significant time, effort, and expense to comply with regulatory and supervisory standards and requirements imposed by our regulators, and we expect that we will continue to do so.
We originate residential mortgage loans and other loans, such as loans guaranteed, in part, by the SBA, all or portions of which are later sold in the secondary market to government sponsored enterprises or agencies, such as the Federal National Mortgage Association (Fannie Mae) and other non-government sponsored investors.
We originate residential mortgage loans and other loans, such as loans guaranteed, in part, by the SBA, all or portions of which are later sold in the secondary market to GSEs, such as Fannie Mae and other non-government sponsored investors.
We operate in areas where our business and the activities of our customers could be impacted by the effects of climate change, including increased frequency or severity of storms, hurricanes, floods, droughts, and rising sea levels.
Climate change may materially adversely affect our business and results of operations. We operate in areas where our business and the activities of our customers could be impacted by the effects of climate change, including increased frequency or severity of storms, hurricanes, floods, droughts, and rising sea levels.
If we are unable to attract and retain banking customers, we may be unable to grow or maintain the levels of our loans and deposits, and our financial condition and results of operations may be adversely affected as a result. Ultimately, we may not be able to compete successfully against current and future competitors.
If we are unable to attract and retain banking customers, we may be unable to grow or maintain the levels of our loans and deposits, and our financial condition and results of operations may be adversely affected as a result.
If we are not able to continue to depend primarily on customer deposits to meet our liquidity and funding needs, access secondary, non-deposit funding sources on favorable terms or otherwise fail to manage our liquidity effectively, our ability to continue to grow may be constrained, and our liquidity, operating margins, business, financial condition and results of operations may be materially adversely affected.
At December 31, 2025, approximately 36% of our deposits (excluding Intra-Company deposits) were uninsured and we are dependent on these deposits for liquidity. 23 If we are not able to continue to depend primarily on customer deposits to meet our liquidity and funding needs, access secondary, non-deposit funding sources on favorable terms or otherwise fail to manage our liquidity effectively, our ability to continue to grow may be constrained, and our liquidity, operating margins, business, financial condition and results of operations may be materially adversely affected.
The Inflation Reduction Act of 2022 imposes a 1% excise tax on the value of our shares we repurchase that exceeds $1 million in the aggregate during any taxable year, subject to certain adjustments. In addition, a number of the changes to the Tax Code are set to expire at the end of 2025.
The Inflation Reduction Act of 2022 imposes a 1% excise tax on the value of our shares we repurchase that exceeds $1 million in the aggregate during any taxable year, subject to certain adjustments.
Our future success depends, in part, upon our ability to address the needs of our customers by using technology to provide products and services that will satisfy customer demands, as well as to create additional efficiencies in our operations.
The effective use of technology increases efficiency and enables financial institutions to better serve customers and to reduce costs. Our future success depends, in part, upon our ability to address the needs of our customers by using technology to provide products and services that will satisfy customer demands, as well as to create additional efficiencies in our operations.
Furthermore, failure to realize the expected revenue increases, cost savings, strategic gains, increases in geographic or product presence, and/or other anticipated benefits from pending or future acquisitions could have a material adverse effect on our business, financial condition and results of operations.
Furthermore, failure to realize the expected revenue increases, cost savings, strategic gains, increases in geographic or product presence, and/or other anticipated benefits from pending or future acquisitions could have a material adverse effect on our business, financial condition and results of operations. 30 If the goodwill that we have recorded or will record in the future in connection with our acquisitions becomes impaired, it could have a negative impact on our results of operations.
For example, the increased prevalence of remote and hybrid working arrangements as a result of COVID-19 has impacted the demand for commercial office space putting pressure on office rental and occupancy rates.
For example, the increased prevalence of remote and hybrid working arrangements as a result of COVID-19 has impacted the demand for commercial office space putting pressure on office rental and occupancy rates. Changes in the real estate market could also affect the value of foreclosed assets.
Changes in any of these factors could increase our funding costs, reduce our net interest margin and/or create liquidity challenges. 23 Additionally, negative news about us or the banking industry in general could negatively impact market and/or customer perceptions of us, which could lead to a loss of depositor confidence and an increase in deposit withdrawals, particularly among those with uninsured deposits.
Additionally, negative news about us or the banking industry in general could negatively impact market and/or customer perceptions of us, which could lead to a loss of depositor confidence and an increase in deposit withdrawals, particularly among those with uninsured deposits.
Beginning in September 2024, as inflation moderated toward the Federal Reserve Board's policy objective, the Federal Reserve Board incrementally reduced the Fed Funds Rate to 4.25% to 4.50% as of February 1, 2025. The timing and magnitude of future Fed Funds Rate decreases are uncertain, and increases in Fed Funds Rates are possible.
Beginning in September 2024, as inflation moderated toward the Federal Reserve Board's policy objective, the Federal Reserve Board incrementally reduced the Fed Funds Rate, which is now at a target range of 3.50% to 3.75%. The timing and magnitude of future Fed Funds Rate decreases are uncertain, and increases in Fed Funds Rates are possible.
State and municipal customers frequently maintain large deposit account balances substantially in excess of the FDIC insurance limit, and these depositors may be more sensitive than other depositors to changes in interest rates.
State and municipal customers frequently maintain large deposit account balances substantially in excess of the FDIC insurance limit, and these depositors may be more sensitive than other depositors to changes in interest rates. Changes in any of these factors could increase our funding costs, reduce our NIM and/or create liquidity challenges.
Many of our competitors have substantially greater resources to invest in technological improvements or are technology focused start-ups with internally developed cloud-native systems that offer improved user interfaces and experiences.
Many of our competitors have substantially greater resources to invest in technological improvements or are technology focused start-ups with internally developed cloud-native systems that offer improved user interfaces and experiences. Due to our size, we may face challenges in allocating sufficient resources to keep pace with technological investments and improvements implemented by our larger competitors.
The effects of such changes are difficult to predict and may produce unintended consequences, like limiting the types of financial services and products we may offer, limiting the fees we may charge, altering demand for existing products and services, increasing the ability of non-banks to offer competing financial services and products, increasing compliance burdens, or otherwise adversely affecting our business, financial condition or results of operations.
The effects of such changes are difficult to predict and may produce unintended consequences, like limiting the types of financial services and products we may offer, limiting the fees we may charge, altering demand for existing products and services, increasing the ability of non-banks to offer competing financial services and products, increasing compliance burdens, or otherwise adversely affecting our business, financial condition or results of operations. 27 The CFPB, established pursuant to the Dodd-Frank Act, has imposed enforcement actions against a variety of bank and non-bank market participants with respect to a number of consumer financial products and services.
In the future, we may seek to supplement organic growth through additional acquisitions. If the purchase price of an acquired company exceeds the fair value of the company's net assets, the excess is carried on the acquirer's balance sheet as goodwill. As of December 31, 2024, we had $553 million of goodwill recorded on our balance sheet.
We have supplemented our internal growth with strategic acquisitions of banks, branches and other financial services companies. In the future, we may seek to supplement organic growth through additional acquisitions. If the purchase price of an acquired company exceeds the fair value of the company's net assets, the excess is carried on the acquirer's balance sheet as goodwill.
In addition, our ability to sell our securities brokerage services is dependent, in part, upon 22 consumers' level of confidence in securities markets. Securities market volatility or other market disruptions may adversely affect our ability to sell our securities brokerage services, which could negatively affect our fee-based non-interest income, and as a result, our results of operations.
Securities market volatility or other market disruptions may adversely affect our ability to sell our securities brokerage and wealth management services, which could negatively affect our fee-based non-interest income, and as a result, our results of operations. 22 Our loan portfolio composition subjects us to credit risk.
RISKS RELATED TO STRATEGIC GROWTH We face a variety of risks in connection with completed and potential acquisitions. We may from time to time seek to supplement organic growth through acquisitions of banks, branches or other financial businesses or assets.
If the Merger is not completed, we would have to pay some of these expenses without realizing the expected benefits of the Merger. We face a variety of risks in connection with completed and potential future acquisitions. We may from time to time seek to supplement organic growth through acquisitions of banks, branches or other financial businesses or assets.
Our loan portfolio composition subjects us to credit risk. At December 31, 2024, approximately 65% of our loan portfolio consisted of commercial loans, commercial mortgage loans, and residential and commercial construction loans.
At December 31, 2025, approximately 63% of our loan portfolio consisted of commercial loans, commercial mortgage loans, and residential and commercial construction loans.
We cannot predict or control changes in interest rates. We are affected by fiscal and monetary policies of the federal government, including those of the Federal Reserve Board, many of which affect interest rates charged on loans and paid on deposits.
We are affected by fiscal and monetary policies of the federal government, including those of the Federal Reserve Board, many of which affect interest rates charged on loans and paid on deposits. During 2022-2024, the Federal Reserve Board raised the target range for the Fed Funds Rate in a series of actions to combat rising inflation.
If the communities in which we operate do not grow, or if prevailing economic conditions locally or nationally are unfavorable, our business could be adversely affected. In addition, increased market competition in a lower demand environment could adversely affect our profit potential. INTEREST RATE AND CREDIT RISKS We are subject to interest rate risk.
In addition, increased market competition in a lower demand environment could adversely affect our profit potential. INTEREST RATE AND CREDIT RISKS We are subject to interest rate risk. We cannot predict or control changes in interest rates.
Our regulators also hold us responsible for privacy and data protection obligations performed by our third-party service providers while providing services to us, as well as disclosures and notifications during a cyber or information security incident.
Our regulators also hold us responsible for privacy and data protection obligations performed by our third-party service providers while providing services to us, as well as disclosures and notifications during a cyber or information security incident. 28 New or changes to existing laws could increase our costs of compliance and business operations and could reduce income from certain business initiatives, including increased privacy-related enforcement activity and higher compliance and technology costs, and could restrict our ability to provide certain products and services.
We are required to evaluate goodwill for impairment at least annually. Write-downs of the amount of any impairment, if necessary, are to be charged to earnings in the period in which the impairment occurs. There can be no assurance that future evaluations of goodwill will not result in impairment charges. We may not be able to achieve our growth plans.
There can be no assurance that future evaluations of goodwill will not result in impairment charges. We may not be able to achieve our growth plans. Our business plan includes the pursuit of profitable growth.
Failure to keep pace with technological change could adversely affect our business. The financial services industry experiences continuous technological change with frequent introductions of new technology-driven products and services. The effective use of technology increases efficiency and enables financial institutions to better serve customers and to reduce costs.
Ultimately, we may not be able to compete successfully against current and future competitors. 31 Failure to keep pace with technological change could adversely affect our business. The financial services industry experiences continuous technological change with frequent introductions of new technology-driven products and services.
The CFPB, established pursuant to the Dodd-Frank Act, has imposed enforcement actions against a variety of bank and non-bank market participants with respect to a number of consumer financial products and services. These enforcement actions have resulted in those participants expending significant time, money and resources to adjust to the initiatives being pursued by the CFPB.
These enforcement actions have resulted in those participants expending significant time, money and resources to adjust to the initiatives being pursued by the CFPB.
Removed
There continues to be economic uncertainty, including the possibility of a recession resulting from elevated levels of inflation and a higher-for-longer interest rate environment, which could negatively impact the quality of our loan portfolio.
Added
Unlike large, national institutions, we are not able to spread the risks of unfavorable local economic conditions across a large number of diversified economies and geographic locations. If the communities in which we operate do not grow, or if prevailing economic conditions locally or nationally are unfavorable, our business could be adversely affected.
Removed
In a series of actions to combat rising inflation that began in March 2022, the Federal Reserve Board raised the Fed Funds Rate to 5.25% to 5.50% in July 2023.
Added
In addition, our ability to sell our securities brokerage and wealth management services is dependent, in part, upon consumers' level of confidence in securities markets.
Removed
In addition, the current elevated level of interest rates may make it more difficult for commercial real estate borrowers to refinance or repay maturing loans and may adversely affect the market value of the underlying real estate. Changes in the real estate market could also affect the value of foreclosed assets.
Added
In addition, due to divergent policies and viewpoints regarding climate change, we are at an increased risk of being subject to different and potentially conflicting legal or regulatory requirements and stakeholder expectations, as well as the risk of harm to our business and brand and our ability to attract and retain employees from negative public opinion related to any of our actual or perceived action or inaction in response to climate-related matters.
Removed
At December 31, 2024, approximately 37% of our deposits were uninsured and we are dependent on these deposits for liquidity.
Added
Furthermore, ongoing legislative or regulatory uncertainties and 26 changes regarding climate-related matters and practices may result in higher regulatory, compliance, credit and other risks and costs, and may subject us to different and potentially conflicting requirements.
Removed
For instance, the leadership of the federal banking agencies, including the OCC, have emphasized that climate-related risks are faced by banking organizations of all types and sizes. If new regulations or supervisory guidance applicable to us came into effect, our compliance costs and other compliance-related risks would be expected to increase and affect our financial position and results of operations.
Added
Additionally, on July 4, 2025, H.R. 1 was signed into law, which included a broad range of tax reform provisions affecting businesses, including extending and modifying certain key provisions from the Tax Act and accelerating the phase-out of certain incentives from the Inflation Reduction Act of 2022. There is uncertainty concerning whether future legislation will further revise the Tax Code.
Removed
There is substantial uncertainty concerning whether those expiring provisions will be extended and whether future legislation will further revise the Tax Code.
Added
RISKS RELATED TO THE CONSUMMATION OF THE MERGER AND OUR FUTURE STRATEGIC GROWTH We expect to incur substantial costs related to the Merger and integration, and these costs may be greater than anticipated due to unexpected events. We have incurred and expect to incur a number of significant non-recurring costs associated with the Merger.
Removed
New or changes to existing laws increase our costs of compliance and business operations and could reduce income from certain business initiatives, including increased privacy-related enforcement activity and higher compliance and technology costs, and could restrict our ability to provide certain products and services.
Added
These costs include legal, financial advisory, accounting, consulting and other advisory fees, severance/employee benefit-related costs, public company filing fees and other regulatory fees, financial printing and other printing costs and other related costs. Some of these costs are payable by us regardless of whether or not the Merger is completed.
Removed
On September 17, 2024, the FDIC, the OCC and the DOJ, each announced new rules and policy statements i mpacting their bank merger review processes.
Added
In addition, we will incur integration costs following the completion of the Merger as we integrate Blue Foundry Bank, including facilities and systems consolidation costs and employment-related costs. We may also incur additional costs to maintain employee morale and to retain key employees.
Removed
Among these actions, the FDIC approved a final statement of policy on bank merger transactions and the OCC approved a final rule updating the agency's regulations for business combinations involving national banks and federal savings associations.
Added
There are a large number of processes, policies, procedures, operations, technologies and systems that may need to be integrated, including purchasing, accounting and finance, payroll, compliance, treasury management, branch operations, vendor management, risk management, lines of business, pricing and benefits.
Removed
The OCC's final rule modifies its procedures for reviewing bank merger applications under the BMA applications, including the elimination of the expedited bank merger review and the streamlined application procedures.
Added
While we have assumed that a certain level of costs will be incurred, there are many factors beyond our control that could affect the total amount or the timing of the integration costs. Moreover, many of the costs that will be incurred are, by their nature, difficult to estimate accurately.
Removed
The OCC’s final rule also includes as an appendix a policy statement which includes a list of characteristics of a merger transaction that the OCC would consider to be consistent or inconsistent with approval.
Added
These integration costs may result in us taking charges against earnings following the completion of the Merger, and the amount and timing of such charges are uncertain at present. There can be no assurances that the expected benefits and efficiencies related to the integration of the businesses will be realized to offset these transaction and integration costs over time.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur policy requires material incidents to be reported within four business days after an incident is determined to be material with the materiality determination to be completed without unreasonable delay. Management's Disclosure Committee has developed a plan to facilitate making timely determinations as to whether and when incidents should be disclosed.
Biggest changeCybersecurity incidents are managed through the ICIRP, which provides direction to management allowing for the timely transfer of information throughout the organization. Our policy requires material incidents to be reported within four business days after an incident is determined to be material with the materiality determination to be completed without unreasonable delay.
The Corporation uses an integrated cybersecurity incident response plan ICIRP designed to enable management to respond timely to cybersecurity incidents, coordinate such responses within the Corporation and with our Board of Directors, notify law enforcement and other government agencies, and notify customers and employees.
The Corporation uses an ICIRP designed to enable management to respond timely to cybersecurity incidents, coordinate such responses within the Corporation and with our Board of Directors, notify law enforcement and other government agencies, and notify customers and employees.
Our Board of Directors provides direction and oversight over the Corporation's enterprise-wide risk management program, including risks related to cybersecurity. The Risk Committee is responsible for overseeing the Corporation's information security program and execution.
Our Board of Directors provides direction and oversight over the Corporation's enterprise-wide risk management program, including risks related to cybersecurity. The Risk Committee is responsible for overseeing the Corporation's information security program and execution. The Risk Committee promotes collaboration and cooperation between various elements within the Corporation relative to information security.
With regard to the possible impact of future cybersecurity threats or incidents, see "Item 1A. Risk Factors."
To our knowledge, previous cybersecurity incidents have not materially affected the Corporation, its business strategy, financial condition or results of operation. With regard to the possible impact of future cybersecurity threats or incidents, see "Item 1A. Risk Factors." 33
If a material incident occurs, the Corporation will describe in detail the material aspects and nature, scope and timing of the incident, along with the impact to its financial condition and results of operations. To our knowledge, previous cybersecurity incidents have not materially affected the Corporation, its business strategy, financial condition or results of operation.
Management's Disclosure Committee has developed a plan to facilitate making timely determinations as to whether and when incidents should be disclosed. If a material incident occurs, the Corporation will describe in detail the material aspects and nature, scope and timing of the incident, along with the impact to its financial condition and results of operations.
Removed
The Risk Committee promotes collaboration and cooperation between various elements within the Corporation relative to information security. 32 Cybersecurity incidents are managed through the ICIRP, which provides direction to management allowing for the timely transfer of information throughout the organization.

Item 2. Properties

Properties — owned and leased real estate

1 edited+0 added−0 removed0 unchanged
Biggest changeItem 2. Properties The Corporation's financial center properties as of December 31, 2024 totaled 216 financial centers. Of those financial centers, 54 were owned and 162 were leased. Remote service facilities (mainly stand-alone ATMs) are excluded from these totals. The Corporation's headquarters is located in Lancaster, Pennsylvania. The Corporation owns an operations center located in East Petersburg, Pennsylvania.
Biggest changeItem 2. Properties The Corporation's financial center properties as of December 31, 2025 totaled 204 financial centers. Of those financial centers, 43 were owned and 161 were leased. Remote service facilities (mainly stand-alone ATMs) are excluded from these totals. The Corporation's headquarters is located in Lancaster, Pennsylvania. The Corporation owns an operations center located in East Petersburg, Pennsylvania.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings The information presented in the "Legal Proceedings" section of "Note 21 - Commitments and Contingencies" in the Notes to Consolidated Financial Statements is incorporated herein by reference. Item 4. Mine Safety Disclosures Not applicable. 33 PART II
Biggest changeItem 3. Legal Proceedings The information presented in the "Legal Proceedings" section of "Note 21 - Commitments and Contingencies" in the Notes to Consolidated Financial Statements in Part I, "Item 1. Financial Statements" is incorporated herein by reference. Item 4. Mine Safety Disclosures Not applicable. 34 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

7 edited+1 added−2 removed8 unchanged
Biggest changeFinancial Statements and Supplementary Data." Securities Authorized for Issuance under Equity Compensation Plans The following table provides information about options outstanding under the Corporation's Employee Equity Plan and the number of securities remaining available for future issuance under the Employee Equity Plan, the Directors' Plan and the ESPP as of December 31, 2024: Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights (1) Weighted-average exercise price of outstanding, options, warrants and rights (2) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in first column) (3) Equity compensation plans approved by security holders 2,702,997 $ 12.61 5,030,550 Equity compensation plans not approved by security holders — — — Total 2,702,997 $ 12.61 5,030,550 (1) The number of securities to be issued upon exercise of outstanding options, warrants and rights includes: (i) 1,094,846 PSUs, which is the target number of PSUs that are payable under the Employee Equity Plan, though no shares will be issued until achievement of applicable performance goals, (ii) 1,315,836 time-vested RSUs granted under the Employee Equity Plan and (iii) 292,315 time-vested RSUs granted under the Directors' Plan.
Biggest changeFinancial Statements and Supplementary Data." Securities Authorized for Issuance under Equity Compensation Plans The following table provides information about the number of securities remaining available for future issuance under the Employee Equity Plan, the Directors' Plan and the ESPP as of December 31, 2025: Plan Category Number of securities to be issued upon exercise of outstanding warrants and rights (1) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in first column) (2) Equity compensation plans approved by security holders 2,876,550 4,143,684 Equity compensation plans not approved by security holders — — Total 2,876,550 4,143,684 (1) The number of securities to be issued upon exercise of outstanding warrants and rights includes: (i) 972,558 PSUs, which is the target number of PSUs that are payable under the Employee Equity Plan, though no shares will be issued until achievement of applicable performance goals, (ii) 1,571,252 time-vested RSUs granted under the Employee Equity Plan and (iii) 332,740 time-vested RSUs granted under the Directors' Plan.
Excludes accrued purchase rights under the ESPP as of December 31, 2024 as the number of shares to be purchased is indeterminable until the shares are issued. 34 Performance Graph The following graph shows cumulative total shareholder return (i.e., price change, plus reinvestment of dividends) on the common stock of the Corporation during the five-year period ended December 31, 2024, compared with (1) the Nasdaq Bank Index and (2) the S&P 500.
Excludes accrued purchase rights under the ESPP as of December 31, 2025 as the number of shares to be purchased is indeterminable until the shares are issued. 35 Performance Graph The following graph shows cumulative total shareholder return (i.e., price change, plus reinvestment of dividends) on the common stock of the Corporation during the five-year period ended December 31, 2025, compared with (1) the Nasdaq Bank Index and (2) the S&P 500.
As permitted by securities laws and other legal requirements and subject to market conditions and other factors, purchases may be made from time to time under the 2025 Repurchase Program in open market or privately negotiated transactions, including without limitation, through accelerated share repurchase transactions. The 2025 Repurchase Program may be discontinued at any time. 36 Item 6. [Reserved]
As permitted by securities laws and other legal requirements and subject to market conditions and other factors, purchases may be made from time to time under the 2026 Repurchase Program in open market or privately negotiated transactions, including without limitation, through accelerated share repurchase transactions. The 2026 Repurchase Program may be discontinued at any time. 37 Item 6. [Reserved]
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Common Stock As of February 3, 2025, the Corporation had 182.2 million shares of $2.50 par value common stock outstanding held by approximately 48,603 holders of record. The closing price per share of the Corporation's common stock on February 25, 2025 was $19.57.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Common Stock As of February 2, 2026, the Corporation had 180.0 million shares of $2.50 par value common stock outstanding held by approximately 53,242 holders of record. The closing price per share of the Corporation's common stock on February 24, 2026 was $21.17.
Under the 2025 Repurchase Program, the Corporation is authorized to repurchase up to $125.0 million of shares of its common stock. Under this authorization, up to $25.0 million of the $125 million authorization may be used to repurchase the Corporation's Preferred Stock through December 31, 2025.
The 2026 Repurchase Program will expire on January 31, 2027. Under the 2026 Repurchase Program the Corporation is authorized to repurchase up to $150.0 million of shares of its common stock. Under this authorization, up to $25.0 million of the $150.0 million authorization may be used to repurchase the Corporation's preferred stock and outstanding subordinated notes.
(3) Consists of: (i) 3,839,493 shares that may be awarded under the Employee Equity Plan, (ii) 325,059 shares that may be awarded under the Directors' Plan and (iii) 865,998 shares that may be purchased under the ESPP.
(2) Consists of: (i) 3,152,543 shares that may be awarded under the Employee Equity Plan, (ii) 256,205 shares that may be awarded under the Directors' Plan and (iii) 734,936 shares that may be purchased under the ESPP.
During 2024, 1.9 million shares were repurchased at a total cost of $30.3 million, or $15.69 per share, under t he 2024 Repurchase Program. On December 17, 2024, the Corporation announced that its Board of Directors approved the 2025 Repurchase Program. The 2025 Repurchase Program will expire on December 31, 2025.
During the year ended December 31, 2025, approximately 3.3 million shares of common stock were repurchased at a total cost of $59.7 million, or an average cost of $18.16 per share, under t he 2025 Repurchase Program. On December 16, 2025, the Corporation announced that its Board of Directors approved the 2026 Repurchase Program.
Removed
(2) The weighted-average exercise price of outstanding warrants and rights does not take into account outstanding PSUs and RSUs granted under the Employee Equity Plan and the Directors' Plan.
Added
Year Ending December 31 Index 2020 2021 2022 2023 2024 2025 Fulton Financial Corporation $ 100.00 $ 138.94 $ 142.98 $ 146.02 $ 177.11 $ 183.57 S&P 500 $ 100.00 $ 128.71 $ 105.40 $ 133.10 $ 166.40 $ 196.16 Nasdaq Bank Index $ 100.00 $ 142.26 $ 115.66 $ 107.92 $ 125.97 $ 131.30 36 Issuer Purchases of Equity Securities Period Total Number of Shares Purchased Average Price Paid per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs October 1, 2025 to October 31, 2025 342,275 $ 17.45 342,275 $ 79,711,778 November 1, 2025 to November 30, 2025 150,000 18.48 150,000 68,643,653 December 1, 2025 to December 31, 2025 590,403 18.82 590,403 65,981,606 (1) Includes 1% excise tax During the fourth quarter of 2025, approximately 1.1 million shares of common stock were repurchased at a total cost of $19.9 million, or an average cost of $18.34 per share, under t he 2025 Repurchase Program.
Removed
Year Ending December 31 Index 2019 2020 2021 2022 2023 2024 Fulton Financial Corporation $ 100.00 $ 76.52 $ 106.37 $ 109.15 $ 111.42 $ 134.46 S&P 500 $ 100.00 $ 118.40 $ 152.39 $ 124.79 $ 157.59 $ 197.02 Nasdaq Bank Index $ 100.00 $ 88.19 $ 125.45 $ 102.00 $ 95.17 $ 111.09 35 Issuer Purchases of Equity Securities There were no repurchases of our common stock during the fourth quarter of 2024.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeFinancial Statements and Supplementary Data: Consolidated Balance Sheets 70 Consolidated Statements of Income 71 Consolidated Statements of Comprehensive Income 72 Consolidated Statements of Shareholders' Equity 73 Consolidated Statements of Cash Flows 74 Notes to Consolidated Financial Statements 76 Management Report On Internal Control Over Financial Reporting 137 Report of Independent Registered Public Accounting Firm 138
Biggest changeFinancial Statements and Supplementary Data: Consolidated Balance Sheet s 71 Consolidated Statements of Income 72 Consolidated Statements of Comprehensive Income 73 Consolidated Statements of Shareholders' Equity 74 Consolidated Statements of Cash Flows 75 Notes to Consolidated Financial Statements 77 Management Report On Internal Control Over Financial Reporting 137 Report of Independent Registered Public Accounting Firm 138
Item 6. [Reserved] 37 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 37 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 64 Item 8.
Item 6. [Reserved] 38 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 38 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 65 Item 8.

Item 7. Management's Discussion & Analysis

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

85 edited+24 added−43 removed34 unchanged
Biggest changeReconciliations of these non-GAAP financial measures to the most directly comparable GAAP measure follow: 2024 2023 2022 (dollars in thousands, except per share data) Operating net income available to common shareholders Net income available to common shareholders $ 278,495 $ 274,032 $ 276,733 Less: Other revenue (1,805) 1,855 — Less: Gain on acquisition, net of tax (36,996) — — Plus: Loss on securities restructuring 20,282 — — Plus: Core deposit intangible amortization 17,307 2,308 1,029 Plus: Acquisition-related expense 37,635 — 10,328 Plus: CECL Day 1 Provision 23,444 — 7,954 Plus: FDIC special assessment 940 6,494 — Less: Gain on Sale-Leaseback Transaction (20,266) — — Plus: FultonFirst implementation and asset disposals 32,038 3,197 — Less: Tax impact of adjustments (23,011) (2,909) (4,055) Operating net income available to common shareholders (numerator) $ 328,063 $ 284,977 $ 291,989 Weighted average shares (diluted) (denominator) 177,223 166,769 165,472 Operating net income available to common shareholders, per share (diluted) $ 1.85 $ 1.71 $ 1.76 39 2024 2023 2022 (dollars in thousands) Operating return on average assets Net income $ 288,743 $ 284,280 $ 286,981 Plus: Other revenue (1,805) 1,855 — Less: Gain on acquisition, net of tax (36,996) — — Plus: Loss on securities restructuring 20,282 — — Plus: Core deposit intangible amortization 17,307 2,308 1,029 Plus: Acquisition-related expense 37,635 — 10,328 Plus: CECL Day 1 Provision 23,444 — 7,954 Plus: FDIC special assessment 940 6,494 — Less: Gain on Sale-Leaseback Transaction (20,266) — — Plus: FultonFirst implementation and asset disposals 32,038 3,197 — Less: Tax impact of adjustments (23,011) (2,909) (4,055) Operating net income (numerator) $ 338,311 $ 295,225 $ 302,237 Total average assets $ 30,473,130 $ 27,229,704 $ 25,971,484 Less: Average net core deposit intangible (61,810) (5,996) (3,915) Total average operating assets (denominator) $ 30,411,320 $ 27,223,708 $ 25,967,569 Operating return on average assets 1.11 % 1.08 % 1.16 % Operating return on average common shareholders' equity (tangible) Net income available to common shareholders $ 278,495 $ 274,032 $ 276,733 Plus: Other revenue (1,805) 1,855 — Less: Gain on acquisition, net of tax (36,996) — — Plus: Loss on securities restructuring 20,282 — Plus: Intangible amortization 17,830 2,944 1,731 Plus: Acquisition-related expense 37,635 — 10,328 Plus: CECL Day 1 Provision 23,444 — 7,954 Plus: FDIC special assessment 940 6,494 — Less: Gain on Sale-Leaseback Transaction (20,266) — — Plus: FultonFirst implementation and asset disposals 32,038 3,197 — Less: Tax impact of adjustments (23,121) (3,043) (4,203) Adjusted net income available to common shareholders (numerator) $ 328,476 $ 285,479 $ 292,543 Average shareholders' equity $ 3,025,642 $ 2,631,249 $ 2,560,323 Less: Average goodwill and intangible assets (615,156) (561,858) (548,102) Less: Average preferred stock (192,878) (192,878) (192,878) Average tangible common shareholders' equity (denominator) $ 2,217,608 $ 1,876,513 $ 1,819,343 Return on average common shareholders' equity (tangible) 14.81 % 15.21 % 16.08 % 40 2024 2023 2022 (dollars in thousands) Efficiency ratio Non-interest expense $ 819,791 $ 679,207 $ 633,728 Less: Amortization of tax credit investments — — (2,783) Less: Intangible amortization (17,830) (2,944) (1,731) Less: Acquisition-related expense (37,635) — (10,328) Less: Debt extinguishment gain (cost) — 720 — Less: FDIC special assessment (940) (6,494) — Less: Gain on Sale-Leaseback Transaction 20,266 — — Less: FultonFirst implementation and asset disposals (32,038) (3,197) — Non-interest expense (numerator) $ 751,614 $ 667,292 $ 618,886 Net interest income $ 960,325 $ 854,286 $ 781,634 Tax equivalent adjustment 17,915 17,811 14,995 Plus: Total non-interest income 275,731 227,678 227,130 Plus: Other revenue (1,805) 1,855 — Less: Gain on acquisition, net of tax (36,996) — — Plus: Investment securities losses (gains), net 20,283 733 27 Total revenue (denominator) $ 1,235,453 $ 1,102,363 $ 1,023,786 Efficiency ratio 60.8 % 60.5 % 60.5 % CRITICAL ACCOUNTING POLICIES The following is a summary of those accounting policies that the Corporation considers to be most important to the presentation of its financial condition and results of operations, because they require management's most difficult judgments as a result of the need to make estimates about the effects of matters that are inherently uncertain.
Biggest changeThese non-GAAP financial measures should not be considered a substitute for GAAP basis measures, and the Corporation strongly encourages a review of its Consolidated Financial Statements in their entirety. 39 Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measure follow: 2025 2024 2023 (dollars in thousands, except per share data) Operating net income available to common shareholders Net income available to common shareholders $ 381,361 $ 278,495 $ 274,032 Less: Other (1) (5,858) (1,805) 1,855 Less: Gain on acquisition, net of tax — (36,996) — Plus: Loss on securities restructuring — 20,282 — Plus: Core deposit intangible amortization 22,010 17,307 2,308 Plus: Acquisition-related expense 1,182 37,635 — Plus: CECL Day 1 Provision — 23,444 — Plus: FDIC special assessment (95) 940 6,494 Less: Gain on Sale-Leaseback Transaction — (20,266) — Plus: FultonFirst implementation and asset disposals 2,271 32,038 3,197 Less: Tax impact of adjustments (4,097) (23,011) (2,909) Operating net income available to common shareholders (numerator) $ 396,774 $ 328,063 $ 284,977 Weighted average shares (diluted) (denominator) 183,289 177,223 166,769 Operating net income available to common shareholders, per share (diluted) $ 2.16 $ 1.85 $ 1.71 (1) Includes a loan recovery adjustment of $5.6 million in 2025, reflected in the provision for credit losses related to a loan acquired in the Republic First Transaction. 2025 2024 2023 (dollars in thousands) Operating return on average assets Net income $ 391,609 $ 288,743 $ 284,280 Less: Other (1) (5,858) (1,805) 1,855 Less: Gain on acquisition, net of tax — (36,996) — Plus: Loss on securities restructuring — 20,282 — Plus: Core deposit intangible amortization 22,010 17,307 2,308 Plus: Acquisition-related expense 1,182 37,635 — Plus: CECL Day 1 Provision — 23,444 — Plus: FDIC special assessment (95) 940 6,494 Less: Gain on Sale-Leaseback Transaction — (20,266) — Plus: FultonFirst implementation and asset disposals 2,271 32,038 3,197 Less: Tax impact of adjustments (4,097) (23,011) (2,909) Operating net income (numerator) $ 407,022 $ 338,311 $ 295,225 Total average assets $ 31,952,633 $ 30,473,130 $ 27,229,704 Less: Average net core deposit intangible (68,709) (61,810) (5,996) Total average operating assets (denominator) $ 31,883,924 $ 30,411,320 $ 27,223,708 Operating return on average assets 1.28 % 1.11 % 1.08 % (1) Includes a loan recovery adjustment of $5.6 million in 2025, reflected in the provision for credit losses related to a loan acquired in the Republic First Transaction. 40 2025 2024 2023 (dollars in thousands) Operating return on average common shareholders' equity (tangible) Net income available to common shareholders $ 381,361 $ 278,495 $ 274,032 Less: Other (1) (5,858) (1,805) 1,855 Less: Gain on acquisition, net of tax — (36,996) — Plus: Loss on securities restructuring — 20,282 — Plus: Intangible amortization 22,462 17,830 2,944 Plus: Acquisition-related expense 1,182 37,635 — Plus: CECL Day 1 Provision — 23,444 — Plus: FDIC special assessment (95) 940 6,494 Less: Gain on Sale-Leaseback Transaction — (20,266) — Plus: FultonFirst implementation and asset disposals 2,271 32,038 3,197 Less: Tax impact of adjustments (4,192) (23,121) (3,043) Adjusted net income available to common shareholders (numerator) $ 397,131 $ 328,476 $ 285,479 Average shareholders' equity $ 3,346,630 $ 3,025,642 $ 2,631,249 Less: Average goodwill and intangible assets (623,752) (615,156) (561,858) Less: Average preferred stock (192,878) (192,878) (192,878) Average tangible common shareholders' equity (denominator) $ 2,530,000 $ 2,217,608 $ 1,876,513 Operating return on average common shareholders' equity (tangible) 15.70 % 14.81 % 15.21 % (1) Includes a loan recovery adjustment of $5.6 million in 2025, reflected in the provision for credit losses related to a loan acquired in the Republic First Transaction. 2025 2024 2023 (dollars in thousands) Efficiency ratio Non-interest expense $ 791,829 $ 819,791 $ 679,207 Less: Intangible amortization (22,462) (17,830) (2,944) Less: Acquisition-related expense (1,182) (37,635) — Less: Debt extinguishment gain (cost) — — 720 Less: FDIC special assessment 95 (940) (6,494) Less: Gain on Sale-Leaseback Transaction — 20,266 — Less: FultonFirst implementation and asset disposals (2,271) (32,038) (3,197) Non-interest expense (numerator) $ 766,009 $ 751,614 $ 667,292 Net interest income $ 1,036,347 $ 960,325 $ 854,286 Tax equivalent adjustment 17,680 17,915 17,811 Plus: Total non-interest income 276,766 275,731 227,678 Plus: Other revenue (258) (1,805) 1,855 Less: Gain on acquisition, net of tax — (36,996) — Plus: Investment securities losses (gains), net 2 20,283 733 Total revenue (denominator) $ 1,330,537 $ 1,235,453 $ 1,102,363 Efficiency ratio 57.6 % 60.8 % 60.5 % 41 CRITICAL ACCOUNTING POLICIES The Corporation's accounting policies are fundamental to understanding Management’s Discussion.
Average deposits and interest rates, by type, are summarized in the following table: 2024 2023 Increase (Decrease) Balance Rate Balance Rate $ % (dollars in thousands) Noninterest-bearing demand $ 5,394,518 — % $ 5,939,799 — % $ (545,281) (9.2) % Interest-bearing demand 7,049,915 1.83 5,582,930 1.12 1,466,985 26.3 Savings and money market deposits 7,364,106 2.45 6,616,087 1.85 748,019 11.3 Total demand deposits and savings and money market deposits 19,808,539 1.56 18,138,816 1.02 1,669,723 9.2 Brokered deposits 981,060 5.27 847,795 5.15 133,265 15.7 Time deposits 3,747,029 4.29 2,170,245 2.94 1,576,784 72.7 Total deposits $ 24,536,628 2.13 % $ 21,156,856 1.38 % $ 3,379,772 16.0 % The cost of total deposits increased 75 bps to 2.13% in 2024 compared to 1.38% in 2023, primarily due to rising interest rates and a change in mix of deposits.
Average deposits and interest rates, by type, are summarized in the following table: 2024 2023 Increase (Decrease) Balance Rate Balance Rate $ % (dollars in thousands) Noninterest-bearing demand $ 5,394,518 — % $ 5,939,799 — % $ (545,281) (9.2) % Interest-bearing demand 7,049,915 1.83 5,582,930 1.12 1,466,985 26.3 Savings and money market deposits 7,364,106 2.45 6,616,087 1.85 748,019 11.3 Total demand and savings and money market deposits 19,808,539 1.56 18,138,816 1.02 1,669,723 9.2 Brokered deposits 981,060 5.27 847,795 5.15 133,265 15.7 Time deposits 3,747,029 4.29 2,170,245 2.94 1,576,784 72.7 Total deposits $ 24,536,628 2.13 % $ 21,156,856 1.38 % $ 3,379,772 16.0 % The cost of total deposits increased 75 bps to 2.13% in 2024 compared to 1.38% in 2023, primarily due to rising interest rates and a change in mix of deposits.
Average borrowings and interest rates, by type, are summarized in the following table: 2024 2023 Increase (Decrease) Balance Rate Balance Rate $ % (dollars in thousands) Federal funds purchased $ 51,306 5.52 % $ 566,379 5.30 % $ (515,073) (90.9) Federal Home Loan Bank advances 804,328 4.30 922,164 5.05 (117,836) (12.8) % Senior debt and subordinated debt 514,073 3.66 539,726 3.96 (25,653) (4.8) Other borrowings and other interest-bearing liabilities (1) 910,675 3.66 743,061 3.77 167,614 22.6 Total borrowings and other interest-bearing liabilities $ 2,280,382 4.39 % $ 2,771,330 4.54 % $ (490,948) (17.7) % (1) Includes repurchase agreements, short-term promissory notes, capital leases and collateral liabilities.
Average borrowings and other interest-bearing liabilities and interest rates, by type, are summarized in the following table: 2024 2023 Increase (Decrease) Balance Rate Balance Rate $ % (dollars in thousands) Federal funds purchased $ 51,306 5.52 % $ 566,379 5.30 % $ (515,073) (90.9) % Federal Home Loan Bank advances 804,328 4.30 922,164 5.05 (117,836) (12.8) Senior debt and subordinated debt 514,073 3.66 539,726 3.96 (25,653) (4.8) Other borrowings and other interest-bearing liabilities (1) 910,675 3.66 743,061 3.77 167,614 22.6 Total borrowings and other interest-bearing liabilities $ 2,280,382 4.39 % $ 2,771,330 4.54 % $ (490,948) (17.7) % (1) Includes repurchase agreements, short-term promissory notes, capital leases and collateral liabilities.
The remaining increase of $22.9 million included a $9.2 million increase in wealth management revenues due to an increase in assets under management, a $4.3 million increase in cash management fee income due to an increase in account analysis fees with customers electing to move funds to interest-bearing deposit accounts, a $3.6 million increase in mortgage banking income primarily due to higher loan volumes and spreads, a $1.8 million increase in SBA income largely due to higher loan sale volumes, a $1.6 million increase in income from bank owned life insurance and a $1.7 million increase in debit card fee income.
The remaining increase of $22.9 million included a $9.2 million increase in wealth management revenues due to an increase in assets under management, a $4.8 million increase in cash management fee income due to an increase in account analysis fees with customers electing to move funds to interest-bearing deposit accounts, a $3.6 million increase in mortgage banking income primarily due to higher loan volumes and spreads, a $1.8 million increase in SBA income largely due to higher loan sale volumes, a $1.6 million increase in income from bank owned life insurance and a $1.7 million increase in debit card fee income.
Note: Changes which are partially attributable to both volume and rate are allocated to the volume and rate components presented above based on the percentage of the direct changes that are attributable to each component.
Note: Changes which are partially attributable to both volume and rate are allocated to the volume and rate components presented above based on the percentage of direct changes that are attributable to each component.
The Corporation has established lower total lending limits for certain types of commercial lending commitments and lower total lending limits based on the Corporation's internal risk rating of an individual borrower at the time the lending commitment is approved. The Corporation adheres to loan portfolio management practices, which include requiring an annual review of the majority of loans.
The Corporation has established lower total lending limits for certain types of commercial lending commitments and lower total lending limits based on the Corporation's internal risk rating of an individual borrower at the time the lending commitment is approved. The Corporation adheres to loan portfolio management practices, which include requiring an annual review of the majority of commercial loans.
The proceeds from the sale were reinvested into higher yielding securities of a similar type and similar duration. 46 Non-Interest Expense The following table presents the components of non-interest expense: Increase (Decrease) 2024 2023 $ % (dollars in thousands) Salaries and employee benefits $ 424,733 $ 376,795 $ 47,938 12.7 % Data processing and software 77,882 66,471 11,411 17.2 Net occupancy 69,359 58,019 11,340 19.5 Other outside services 47,811 45,149 2,662 5.9 FDIC insurance 23,829 25,565 (1,736) (6.8) Equipment 17,850 14,390 3,460 24.0 Marketing 8,958 9,004 (46) (0.5) Professional fees 10,681 8,392 2,289 27.3 Intangible amortization 17,830 2,944 14,886 N/M Other 71,451 69,281 2,170 3.1 Subtotal 770,384 676,010 94,374 14.0 % Gain on Sale-Leaseback Transaction (20,266) — (20,266) N/M Acquisition-related expenses 37,635 — 37,635 N/M FultonFirst implementation and asset disposals 32,038 3,197 28,841 N/M Total Non-Interest Expense $ 819,791 $ 679,207 $ 140,584 20.7 % Non-interest expense in 2024 increased $140.6 million, or 20.7%, compared to 2023.
The proceeds from the sale were reinvested into higher yielding securities of a similar type and similar duration. 51 Non-Interest Expense The following table presents the components of non-interest expense: Increase (Decrease) 2024 2023 $ % (dollars in thousands) Salaries and employee benefits $ 424,733 $ 376,795 $ 47,938 12.7 % Data processing and software 77,882 66,471 11,411 17.2 Net occupancy 69,359 58,019 11,340 19.5 Other outside services 47,811 45,149 2,662 5.9 FDIC insurance 23,829 25,565 (1,736) (6.8) Equipment 17,850 14,390 3,460 24.0 Marketing 8,958 9,004 (46) (0.5) Professional fees 10,681 8,392 2,289 27.3 Intangible amortization 17,830 2,944 14,886 N/M Other 71,451 69,281 2,170 3.1 Subtotal $ 770,384 $ 676,010 $ 94,374 14.0 % Gain on sale-leaseback (20,266) — (20,266) N/M FultonFirst implementation and asset disposals 32,038 3,197 28,841 N/M Acquisition-related expenses 37,635 — 37,635 N/M Total non-interest expense $ 819,791 $ 679,207 $ 140,584 20.7 % Non-interest expense in 2024 increased $140.6 million, or 20.7%, compared to 2023.
Average loans and average FTE yields, by type, are summarized in the following table: 2024 2023 Increase (Decrease) Balance Yield Balance Yield $ % (dollars in thousands) Real estate - commercial mortgage $ 9,052,738 6.51 % $ 7,876,076 5.97 % $ 1,176,662 14.9 % Commercial and industrial 4,779,254 6.67 4,596,742 6.27 182,512 4.0 Real estate - residential mortgage 5,925,708 4.31 5,079,739 3.76 845,969 16.7 Real estate - home equity 1,060,520 7.43 1,060,396 6.95 124 — Real estate - construction 1,275,562 7.61 1,247,336 6.81 28,226 2.3 Consumer 725,308 6.67 748,089 5.94 (22,781) (3.0) Leases and other loans (1) 326,024 5.77 320,924 4.37 5,100 1.6 Total loans $ 23,145,114 6.08 % $ 20,929,302 5.57 % $ 2,215,812 10.6 % (1) Consists of equipment lease financing, overdrafts and net origination fees and costs. 44 During 2024, average net loans increased $2.2 billion, or 10.6%, compared to 2023.
Average loans and average FTE yields, by type, are summarized in the following table: 2024 2023 Increase (Decrease) Balance Yield Balance Yield $ % (dollars in thousands) Real estate - commercial mortgage $ 9,052,738 6.51 % $ 7,876,076 5.97 % $ 1,176,662 14.9 % Commercial and industrial 4,779,254 6.67 4,596,742 6.27 182,512 4.0 Real estate - residential mortgage 5,925,708 4.31 5,079,739 3.76 845,969 16.7 Real estate - home equity 1,060,520 7.43 1,060,396 6.95 124 — Real estate - construction 1,275,562 7.61 1,247,336 6.81 28,226 2.3 Consumer 725,308 6.67 748,089 5.94 (22,781) (3.0) Leases and other loans (1) 326,024 5.77 320,924 4.37 5,100 1.6 Total loans $ 23,145,114 6.08 % $ 20,929,302 5.57 % $ 2,215,812 10.6% (1) Consists of equipment lease financing, overdrafts and net origination fees and costs. 49 During 2024, average net loans increased $2.2 billion, or 10.6%, compared to 2023.
Additionally, included in the ACL as of December 31, 2024 was $54.6 million recorded for PCD Loans acquired in the Republic First Transaction. The ACL includes qualitative adjustments, as appropriate, intended to capture the impact of uncertainties not reflected in the quantitative models.
Additionally, included in the ACL as of December 31, 2024 was $54.6 million recorded for PCD Loans acquired in the Republic First Transaction. 60 The ACL includes qualitative adjustments, as appropriate, intended to capture the impact of uncertainties not reflected in the quantitative models.
Additionally, management monitors the loan portfolio throughout the year taking into account, among other things, the size, complexity and level risk of loans and individual borrowers. An independent loan review function assesses the portfolio for internal risk rating accuracy and loan servicing policy requirements.
Additionally, management monitors the loan portfolio throughout the year taking into account, among other things, the size, complexity and risk of loans and individual borrowers. An independent loan review function assesses the portfolio for internal risk rating accuracy and loan servicing policy requirements.
In May 2024, the Corporation sold $345.7 million of AFS securities and recorded a pre-tax loss of $20.3 million.
In May 2024, the Corporation sold $345.7 million of AFS investment securities and recorded a pre-tax loss of $20.3 million.
The Corporation manages the risk associated with changes in interest rates through the techniques described within Item "7A. Quantitative and Qualitative Disclosures About Market Risk." The following table provides a comparative average balance sheet and net interest income analysis for 2024 compared to 2023 and 2022.
The Corporation manages the risk associated with changes in interest rates through the techniques described within Item "7A. Quantitative and Qualitative Disclosures About Market Risk." The following table provides a comparative average balance sheet and net interest income analysis for 2025 compared to 2024 and 2023.
The Capital Rules require the Corporation and Fulton Bank to: • Meet a minimum Common Equity Tier 1 capital ratio of 4.50% of risk-weighted assets; • Meet a minimum Tier 1 Leverage capital ratio of 4.00% of average assets; • Meet a minimum Total capital ratio of 8.00% of risk-weighted assets and a minimum Tier 1 capital ratio of 6.00% of risk-weighted assets; • Maintain a "capital conservation buffer" of 2.50% above the minimum risk-based capital requirements, which must be maintained to avoid restrictions on capital distributions and certain discretionary bonus payments; and • Comply with a revised definition of capital to improve the ability of regulatory capital instruments to absorb losses.
The Capital Rules require the Corporation and Fulton Bank to: • Meet a minimum CET1 capital ratio of 4.50% of risk-weighted assets; • Meet a minimum Tier 1 Leverage capital ratio of 4.00% of average assets; • Meet a minimum Total capital ratio of 8.00% of risk-weighted assets and a minimum Tier 1 capital ratio of 6.00% of risk-weighted assets; • Maintain a "capital conservation buffer" of 2.50% above the minimum risk-based capital requirements, which must be maintained to avoid restrictions on capital distributions and certain discretionary bonus payments; and • Comply with a revised definition of capital to improve the ability of regulatory capital instruments to absorb losses.
This scenario resulted in a hypothetical increase to the ACL of approximately $39.5 million. For further discussion of the methodology used in the determination of the ACL, refer to Note 1, "Summary of Significant Accounting Policies" in the Notes to the Consolidated Financial Statements in "Item 8.
This scenario resulted in a hypothetical increase to the ACL of approximately $35.5 million. For further discussion of the methodology used in the determination of the ACL, refer to Note 1, "Summary of Significant Accounting Policies" in the Notes to the Consolidated Financial Statements in "Item 8.
The Corporation reviews portfolio concentrations and adjusts the lending limits based on asset quality, economic forecasts and industry outlook. 53 The following table summarizes the industry concentrations within the commercial mortgage and the commercial and industrial loan portfolios: December 31, 2024 2023 Real estate (1) 39.5 % 46.6 % Retail 6.6 3.3 Health care 6.3 6.6 Agriculture 5.3 5.6 Other services 5.3 4.5 Manufacturing 5.1 6.1 Construction (2) 4.3 4.1 Hospitality and food services 4.0 3.6 Wholesale trade 3.4 3.2 Educational services 3.0 2.9 Professional, scientific and technical services 2.7 2.2 Arts, entertainment and recreation 2.4 1.9 Finance and Insurance 1.6 1.3 Transportation and warehousing 1.5 1.7 Public administration 1.3 1.0 Administrative and Support 1.2 1.1 Other 6.5 4.3 Total 100.0 % 100.0 % (1) Includes commercial loans to borrowers engaged in the business of: renting, leasing or managing real estate for others; selling and/or buying real estate for others; and appraising real estate.
The Corporation reviews portfolio concentrations and adjusts the lending limits based on asset quality, economic forecasts and industry outlook. 54 The following table summarizes the industry concentrations within the commercial mortgage and the commercial and industrial loan portfolios: December 31, 2025 2024 Real estate (1) 42.3 % 39.5 % Health care 7.0 6.3 Manufacturing 7.0 5.1 Retail 6.0 6.6 Agriculture 5.2 5.3 Construction (2) 4.6 4.3 Other services 4.5 5.3 Wholesale trade 4.2 3.4 Hospitality and food services 3.9 4.0 Educational services 3.0 3.0 Professional, scientific and technical services 2.6 2.7 Arts, entertainment and recreation 2.4 2.4 Finance and insurance 1.4 1.6 Public administration 1.3 1.3 Transportation and warehousing 1.3 1.5 Administrative and Support 1.0 1.2 Other 2.3 6.5 Total 100.0 % 100.0 % (1) Includes commercial loans to borrowers engaged in the business of: renting, leasing or managing real estate for others, selling and/or buying real estate for others and appraising real estate.
(2) Includes accruing loans 90 days or more past due and non-accrual loans and leases. 58 Allowance for Credit Losses The Corporation accounts for the credit risk associated with lending activities through the ACL and the provision for credit losses.
(2) Includes accruing loans 90 days or more past due and non-accrual loans and leases. 59 Allowance for Credit Losses The Corporation accounts for the credit risk associated with lending activities through the ACL and the provision for credit losses.
These obligations include payments for liabilities recorded on the Corporation's consolidated balance sheets as well as contractual obligations for purchased services. Contractual purchase obligations to third parties that were fixed and determinable of approximately $72.4 million and $124.6 million at December 31, 2024 and 2023, respectively, include information technology, telecommunication and data processing outsourcing contracts.
These obligations include payments for liabilities recorded on the Corporation's Consolidated Balance Sheets as well as contractual obligations for purchased services. Contractual purchase obligations to third parties that were fixed and determinable of approximately $55.6 million and $72.4 million at December 31, 2025 and 2024, respectively, include information technology, telecommunication and data processing outsourcing contracts.
For commercial and industrial loans, commercial mortgage loans and construction loans to commercial borrowers, an internal risk rating process is used to monitor credit quality.
For commercial and industrial loans, commercial mortgage loans, construction loans to commercial borrowers and leases and other loans, an internal risk rating process is used to monitor credit quality.
Certain non-qualifying capital instruments, including cumulative preferred stock and TruPS, are excluded as a component of Tier 1 capital for institutions of the Corporation's size. 61 As of December 31, 2024, the Corporation's capital levels met the minimum capital requirements, including the capital conservation buffers, as prescribed in the Capital Rules.
Certain non-qualifying capital instruments, including cumulative preferred stock and TruPS, are excluded as a component of Tier 1 capital for institutions of the Corporation's size. 62 As of December 31, 2025, the Corporation's capital levels met the minimum capital requirements, including the capital conservation buffers, as prescribed in the Capital Rules.
There were no other conditions or events in 2024 that management believes have changed the Corporation's capital categories.
There were no other conditions or events in 2025 that management believes have changed the Corporation's capital categories.
The following table summarizes the Corporation's capital ratios in comparison to regulatory requirements: December 31, 2024 December 31, 2023 Regulatory Minimum for Capital Adequacy With Capital Conservation Buffers Total Risk-Based Capital (to Risk-Weighted Assets) 14.3% 14.0% 8.0% 10.5% Tier I Risk-Based Capital (to Risk-Weighted Assets) 11.5% 11.2% 6.0% 8.5% Common Equity Tier I (to Risk-Weighted Assets) 10.8% 10.3% 4.5% 7.0% Tier I Leverage Capital (to Average Assets) 9.0% 9.5% 4.0% 4.0% Contractual Obligations and Off-Balance Sheet Arrangements The Corporation has various financial obligations that require future cash payments.
The following table summarizes the Corporation's capital ratios in comparison to regulatory requirements: December 31, 2025 December 31, 2024 Regulatory Minimum for Capital Adequacy With Capital Conservation Buffers Total Risk-Based Capital (to Risk-Weighted Assets) 15.2% 14.3% 8.0% 10.5% Tier I Risk-Based Capital (to Risk-Weighted Assets) 11.8% 11.5% 6.0% 8.5% CET1 (to Risk-Weighted Assets) 12.6% 10.8% 4.5% 7.0% Tier I Leverage Capital (to Average Assets) 9.7% 9.0% 4.0% 4.0% Contractual Obligations and Off-Balance Sheet Arrangements The Corporation has various financial obligations that require future cash payments.
In November 2024, the Corporation retired $168.8 million of subordinated notes issued in November 2014 and June 2015 which matured on November 15, 2024. See "Note 10 - Borrowings" of the Notes to Consolidated Financial Statements for additional details.
In November 2024, the Corporation retired $168.8 million of subordinated notes issued in November 2014 and June 2015 which matured on November 15, 2024. See "Note 10 - Borrowings" in the Notes to the Consolidated Financial Statements in "Item 8. Financial Statements and Supplementary Data" for details of borrowings.
As of December 31, 2024, Fulton Bank met the well-capitalized requirements under the regulatory framework for prompt corrective action. To be categorized as well-capitalized, a bank must maintain minimum Total risk-based, Tier I risk-based, Common Equity Tier I risk-based and Tier I leverage ratios as set forth in the Capital Rules.
As of December 31, 2025, Fulton Bank met the well-capitalized requirements under the regulatory framework for prompt corrective action. To be categorized as well-capitalized, a bank must maintain minimum Total risk-based, Tier I risk-based, CET1 risk-based and Tier I leverage ratios as set forth in the Capital Rules.
Recognition and measurement of tax positions is based upon management's evaluations of current taxing authorities' examinations of the Corporation's tax returns, recent positions taken by the taxing authorities on similar transactions and the overall tax environment. Income tax expense was $55.9 million and $64.4 million for the years ended December 31, 2024 and December 31, 2023, respectively.
Recognition and measurement of tax positions is based upon management's evaluations of current taxing authorities' examinations of the Corporation's tax returns, recent positions taken by the taxing authorities on similar transactions and the overall tax environment. Income tax expense was $94.0 million and $55.9 million for the years ended December 31, 2025 and 2024, respectively.
(2) Ending loan portfolio segment balances as a % of total net loans for the periods presented. Management believes that the $379.2 million ACL - loans as of December 31, 2024 is sufficient to cover expected credit losses in the loan portfolio.
(2) Ending loan portfolio segment balances as a percentage of total net loans for the periods presented. Management believes that the $364.5 million ACL - loans as of December 31, 2025 is sufficient to cover expected credit losses in the loan portfolio.
Non-Interest Income The following table presents the components of non-interest income: Increase (Decrease) 2024 2023 $ % (dollars in thousands) Wealth management $ 84,743 $ 75,541 $ 9,202 12.2 % Commercial banking: Merchant and card 29,186 29,205 (19) — Cash management 28,106 23,340 4,766 20.4 Capital markets 11,033 15,654 (4,621) (29.5) Other commercial banking 16,657 12,961 3,696 28.5 Total commercial banking 84,982 81,160 3,822 4.7 Consumer banking: Card 30,914 26,343 4,571 17.4 Overdraft 13,764 11,416 2,348 20.6 Other consumer banking 10,826 9,438 1,388 14.7 Total consumer banking 55,504 47,197 8,307 17.6 Mortgage banking 13,943 10,388 3,555 34.2 Other 19,846 14,125 5,721 40.5 Non-interest income before investment securities gains (losses) and gain on acquisition, net of tax 259,018 228,411 30,607 13.4 Gain on acquisition, net of tax 36,996 — 36,996 N/M Investment securities losses, net (20,283) (733) (19,550) N/M Total Non-Interest Income $ 275,731 $ 227,678 $ 48,053 21.1 % Non-interest income before investment securities losses and gain on acquisition, net of tax increased $30.6 million, or 13.4%, during 2024 compared to 2023.
The increase was primarily due to the Republic First Transaction, which included a provision for credit losses of $23.4 million for non-PCD Loans, partially offset by an elevated level of provision for credit losses in the same period in 2023 due to a $13.3 million charge-off for a commercial office loan. 50 Non-Interest Income The following table presents the components of non-interest income: Increase (Decrease) 2024 2023 $ % (dollars in thousands) Wealth management $ 84,743 $ 75,541 $ 9,202 12.2 % Commercial banking: Merchant and card 29,186 29,205 (19) — Cash management 28,106 23,340 4,766 20.4 Capital markets 11,033 15,654 (4,621) (29.5) Other commercial banking 16,657 12,961 3,696 28.5 Total commercial banking 84,982 81,160 3,822 4.7 Consumer banking: Card 30,914 26,343 4,571 17.4 Overdraft 13,764 11,416 2,348 20.6 Other consumer banking 10,826 9,438 1,388 14.7 Total consumer banking 55,504 47,197 8,307 17.6 Mortgage banking 13,943 10,388 3,555 34.2 Other 19,846 14,125 5,721 40.5 Non-interest income before investment securities gains (losses) 259,018 228,411 30,607 13.4 Gain on acquisition, net of tax 36,996 — 36,996 N/M Investment securities (losses) gains, net (20,283) (733) (19,550) N/M Total Non-Interest Income $ 275,731 $ 227,678 $ 48,053 21.1 % Non-interest income before investment securities losses and gain on acquisition, net of tax increased $30.6 million, or 13.4%, during 2024 compared to 2023.
(2) Average balances include non-performing loans. (3) Average balances include amortized historical cost for AFS securities; the related unrealized holding gains (losses) are included in other assets.
(2) Average balances include amortized historical cost for AFS investment securities; the related unrealized holding gains (losses) are included in other assets.
The following table presents a summary of the Corporation's earnings and selected performance ratios: 2024 2023 2022 (dollars in thousands, except per share) Net income $ 288,743 $ 284,280 $ 286,981 Net income available to common shareholders $ 278,495 $ 274,032 $ 276,733 Net income available to common shareholders per share (diluted) $ 1.57 $ 1.64 $ 1.67 Operating net income available to common shareholders per share (1) $ 1.85 $ 1.71 $ 1.76 Return on average assets 0.95 % 1.04 % 1.10 % Operating return on average assets (1) 1.11 % 1.08 % 1.16 % Return on average common shareholders' equity 9.83 % 11.24 % 11.69 % Operating return on average common shareholders' equity (tangible) (1) 14.81 % 15.21 % 16.08 % Net interest margin (2) 3.42 % 3.42 % 3.27 % Efficiency ratio (1) 60.8 % 60.5 % 60.5 % Non-performing assets to total assets 0.69 % 0.56 % 0.66 % Net charge-offs to average loans, annualized 0.19 % 0.14 % 0.04 % (1) Ratio represents a financial measure derived by methods other than GAAP.
The following table presents a summary of the Corporation's earnings and selected performance ratios: 2025 2024 2023 (dollars in thousands, except per share) Net income $ 391,609 $ 288,743 $ 284,280 Net income available to common shareholders $ 381,361 $ 278,495 $ 274,032 Net income available to common shareholders per share (diluted) $ 2.08 $ 1.57 $ 1.64 Operating net income available to common shareholders per share (1) $ 2.16 $ 1.85 $ 1.71 Return on average assets 1.23 % 0.95 % 1.04 % Operating return on average assets (1) 1.28 % 1.11 % 1.08 % Return on average common shareholders' equity 12.09 % 9.83 % 11.24 % Operating return on average common shareholders' equity (tangible) (1) 15.70 % 14.81 % 15.21 % Net interest margin (2) 3.51 % 3.42 % 3.42 % Efficiency ratio (1) 57.6 % 60.8 % 60.5 % Non-performing assets to total assets 0.58 % 0.69 % 0.56 % Net charge-offs to average loans, annualized 0.21 % 0.19 % 0.14 % (1) Represents a financial measure derived by methods other than GAAP.
The Corporation does not have a significant concentration of credit risk with any single borrower. As of December 31, 2024, approximately $11.0 billion, or 45.7%, of the loan portfolio was comprised of commercial mortgage loans and construction loans.
The Corporation does not have a significant concentration of credit risk with any single borrower. As of December 31, 2025, approximately $10.8 billion, or 44.7%, of the loan portfolio was comprised of commercial mortgage loans and construction loans.
The evaluation of credit risk for residential mortgages, home equity loans, construction loans to individuals, consumer loans and leases and other loans is based on payment history through the monitoring of delinquency levels and trends. 57 Total internally risk-rated loans were $15.4 billion and $13.7 billion as of December 31, 2024 and 2023, respectively, of which $1.8 billion and $925.0 million were criticized and classified loans, respectively.
The evaluation of credit risk for residential mortgages, home equity loans, construction loans to individuals and consumer loans is based on payment history through the monitoring of delinquency levels and trends. 58 Total internally risk-rated loans were $15.4 billion as of December 31, 2025 and 2024, of which $1.5 billion and $1.8 billion were criticized and classified loans, respectively.
The provision for credit losses for 2024 was $71.6 million compared to a provision for credit losses of $54.0 million in 2023. The increase in the provision for credit losses was primarily driven by a $23.4 million CECL Day 1 Provision related to the Republic First Transaction in 2024.
The provision for credit losses for 2025 was $35.7 million compared to a provision for credit losses of $71.6 million in 2024. The decrease in the provision for credit losses was primarily driven by a $23.4 million CECL Day 1 Provision related to the Republic First Transaction in 2024.
(4) ACL - loans relates to the ACL specifically for net loans and does not include the ACL for OBS credit exposures, which is included in other liabilities. 43 Comparison of 2024 to 2023 The following table summarizes the changes in FTE interest income and interest expense resulting from changes in average balances (volumes) and changes in yields and rates: 2024 versus 2023 Increase (decrease) due to change in Volume Yield/Rate Net (dollars in thousands) FTE interest income on: Net loans (1) $ 128,611 $ 111,229 $ 239,840 Investment securities 7,513 26,479 33,992 Other interest-earning assets 28,897 6,335 35,232 Total FTE interest income $ 165,021 $ 144,043 $ 309,064 Interest expense on: Demand deposits $ 19,480 $ 46,995 $ 66,475 Savings and money market deposits 15,022 43,093 58,115 Brokered deposits 7,016 1,040 8,056 Time deposits 59,441 37,568 97,009 Borrowings and other interest-bearing liabilities (22,532) (4,202) (26,734) Total interest expense $ 78,427 $ 124,494 $ 202,921 (1) Average balance includes non-performing loans.
The ETR is generally lower than the federal statutory rate of 21% due to tax-exempt interest income earned on loans, investments in tax-free municipal securities and TCIs that generate tax credits under various federal programs. 48 Comparison of 2024 to 2023 The following table summarizes the changes in FTE interest income and interest expense resulting from changes in average balances (volumes) and changes in yields and rates: 2024 versus 2023 Increase (decrease) due to change in Volume Yield/Rate Net (dollars in thousands) FTE interest income on: Net loans (1) $ 128,611 $ 111,229 $ 239,840 Investment securities 7,513 26,479 33,992 Other interest-earning assets 28,897 6,335 35,232 Total FTE interest income $ 165,021 $ 144,043 $ 309,064 Interest expense on: Demand deposits $ 19,480 $ 46,995 $ 66,475 Savings and money market deposits 15,022 43,093 58,115 Brokered deposits 7,016 1,040 8,056 Time deposits 59,441 37,568 97,009 Borrowings and other interest-bearing liabilities (22,532) (4,202) (26,734) Total interest expense $ 78,427 $ 124,494 $ 202,921 (1) Average balance includes non-performing loans and loan fees.
(2) Includes commercial loans to borrowers engaged in the construction industry. The commercial mortgage loan portfolio consists of 46% owner occupied commercial mortgage loans and 54% of non-owner occupied commercial mortgage loans as of December 31, 2024. The following table summarizes the non-owner occupied commercial mortgage loan portfolio and the percent to total net loans.
(2) Includes commercial loans to borrowers engaged in the construction industry. The commercial mortgage loan portfolio consists of 45.0% owner occupied commercial mortgage loans and 55.0% non-owner occupied commercial mortgage loans as of December 31, 2025. The following table summarizes the non-owner occupied commercial mortgage loan portfolio outstanding balance and the percent to total net loans.
The EAD incorporates a prepayment rate and applies the PD rates to estimate the projected exposure at default across the life of each loan. The ACL is calculated by applying the LGD to the EAD at each period across the life of each loan.
The EAD incorporates a prepayment rate and applies the PD rates to estimate the projected exposure at default across the life of each loan. The ACL is calculated by applying the LGD to the EAD at each period across the life of each loan. The ACL incorporates the Corporation’s historical credit observations, current conditions and reasonable and supportable forecasts.
The increase in interest expense attributable to rate was driven by the increases in savings and money market deposits, interest-bearing demand deposits, time deposits, borrowings and other interest-bearing liabilities and brokered deposits. The increase in interest expense attributable to volume was $82.9 million, primarily driven by increases in borrowings and other interest-bearing liabilities and brokered deposits.
The increase in interest expense attributable to volume was primarily driven by increases in average savings and money market deposits, average interest-bearing demand deposits and average time deposits, partially offset by a decrease in average borrowings and other interest-bearing liabilities and average brokered deposits.
During 2024, non-accrual loans as a percentage of net loans increased to 0.79%, compared to 0.57% as of December 31, 2023.
During 2025, non-accrual loans as a percentage of net loans decreased to 0.64% compared to 0.79% as of December 31, 2024.
Financial Statements and Supplementary Data." 42 RESULTS OF OPERATIONS Net Interest Income FTE net interest income was $978.2 million for the year ended December 31, 2024, an increase of $106.1 million, compared to $872.1 million for the same period in 2023. For the twelve months ended December 31, 2024 and December 31, 2023, NIM was 3.42%.
Financial Statements and Supplementary Data." 43 RESULTS OF OPERATIONS Net Interest Income FTE net interest income was $1.1 billion for the year ended December 31, 2025, an increase of $75.8 million, compared to $978.2 million for the same period in 2024. For the years ended December 31, 2025 and December 31, 2024, NIM was 3.51% and 3.42%, respectively.
Net income available to common shareholders per diluted share was $1.57 for the year ended December 31, 2024, a $0.07 decrease compared to $1.64 in 2023.
Net income available to common shareholders per diluted share was $2.08 for the year ended December 31, 2025, a $0.51 increase compared to $1.57 in 2024.
The following table presents non-performing assets: December 31, 2024 2023 2022 (dollars in thousands) Non-accrual loans (1)(2) $ 189,293 $ 121,620 $ 144,443 Loans 90 days or more past due and still accruing (2) 30,781 31,721 27,463 Total non-performing loans and leases 220,074 153,341 171,906 OREO (3) 2,621 896 5,790 Total non-performing assets $ 222,695 $ 154,237 $ 177,696 Non-accrual loans to total loans 0.79 % 0.57 % 0.71 % Non-performing loans to total loans 0.92 % 0.72 % 0.85 % Non-performing assets to total assets 0.69 % 0.56 % 0.66 % ACL to non-performing loans 172 % 191 % 157 % (1) The amount of interest income on non-accrual loans that was recognized in 2024, 2023 and 2022 was approximately $1.0 million, $1.5 million and $2.2 million, respectively.
The following table presents non-performing assets: December 31, 2025 2024 2023 (dollars in thousands) Non-accrual loans (1)(2) $ 153,872 $ 189,293 $ 121,620 Loans 90 days or more past due and still accruing (2) 29,924 30,781 31,721 Total non-performing loans and leases 183,796 220,074 153,341 OREO (3) 1,365 2,621 896 Total non-performing assets $ 185,161 $ 222,695 $ 154,237 Non-accrual loans to total loans 0.64 % 0.79 % 0.57 % Non-performing loans to total loans 0.76 % 0.92 % 0.72 % Non-performing assets to total assets 0.58 % 0.69 % 0.56 % ACL to non-performing loans 198 % 172 % 191 % (1) The amount of interest income on non-accrual loans that was recognized in 2025, 2024 and 2023 was approximately $2.8 million, $1.0 million and $1.5 million in income, respectively.
The following table presents the activity in the ACL: December 31, December 31, December 31, 2024 2023 2022 (dollars in thousands) Net loans $ 24,044,919 $ 21,351,094 $ 20,279,547 Average balance of net loans $ 23,145,114 $ 20,929,302 $ 19,152,740 Balance of ACL at beginning of period $ 293,404 $ 269,366 $ 249,001 CECL Day 1 Provision (1) 23,444 — 7,954 Initial purchased credit deteriorated loans 54,631 — 1,135 Loans charged off: Real estate - commercial mortgage (13,186) (17,999) (12,473) Commercial and industrial (26,585) (9,246) (2,390) Real estate - residential mortgage (1,472) (62) (66) Consumer and real estate - home equity (8,490) (7,514) (4,412) Real estate - construction — — — Leases and other loans (4,696) (4,380) (2,131) Total loans charged off (54,429) (39,201) (21,472) Recoveries of loans previously charged off: Real estate - commercial mortgage 603 1,076 3,860 Commercial and industrial 4,440 3,473 5,893 Real estate - residential mortgage 472 421 425 Consumer and real estate - home equity 3,357 3,198 2,581 Real estate - construction 382 858 574 Leases and other loans 730 1,103 759 Total recoveries 9,984 10,129 14,092 Net loans charged off (recoveries) (44,445) (29,072) (7,380) Provision for credit losses (1)(2) 52,122 53,110 18,656 Balance of ACL at end of period $ 379,156 $ 293,404 $ 269,366 Provision for OBS credit exposures (1) $ (3,930) $ 926 $ 1,411 Reserve for OBS credit exposures (3) $ 14,161 $ 17,254 $ 16,328 Selected Asset Quality Ratios %: Net charge-offs to average loans 0.19 % 0.14 % 0.04 % ACL - loans to total net loans 1.58 1.37 1.33 Non-performing assets (4) to total assets 0.69 0.56 0.66 Non-accrual loans to total net loans 0.79 0.57 0.71 ACL - loans to non-performing loans 172 191 157 ACL - loans to non-accrual loans 200 241 186 (1) These amounts are reflected in the provision for credit losses in the Consolidated Statements of Income.
The following table presents the activity in the ACL: December 31, December 31, December 31, 2025 2024 2023 (dollars in thousands) Net loans $ 24,144,884 $ 24,044,919 $ 21,351,094 Average balance of net loans $ 23,995,200 $ 23,145,114 $ 20,929,302 Balance of ACL at beginning of period $ 379,156 $ 293,404 $ 269,366 CECL Day 1 Provision (1) — 23,444 — Initial PCD allowance for credit losses — 54,631 — Loans charged off: Real estate - commercial mortgage (36,518) (13,186) (17,999) Commercial and industrial (20,787) (26,585) (9,246) Real estate - residential mortgage (1,053) (1,472) (62) Consumer and real estate - home equity (8,817) (8,490) (7,514) Real estate - construction (5,386) — — Leases and other loans (5,637) (4,696) (4,380) Total loans charged off (78,198) (54,429) (39,201) Recoveries of loans previously charged off: Real estate - commercial mortgage 5,447 603 1,076 Commercial and industrial 18,377 4,440 3,473 Real estate - residential mortgage 640 472 421 Consumer and real estate - home equity 3,146 3,357 3,198 Real estate - construction 227 382 858 Leases and other loans 780 730 1,103 Total recoveries of loans previously charged-off 28,617 9,984 10,129 Net loans charged off (recoveries) (49,581) (44,445) (29,072) Provision for credit losses (1)(2) 34,887 52,122 53,110 Balance of ACL at end of period $ 364,462 $ 379,156 $ 293,404 Provision for OBS credit exposures (1) $ 811 $ (3,930) $ 926 Reserve for OBS credit exposures (3) $ 14,972 $ 14,161 $ 17,254 Selected Asset Quality Ratios %: Net charge-offs to average loans 0.21 % 0.19 % 0.14 % ACL - loans to total net loans 1.51 1.58 1.37 Non-performing assets (4) to total assets 0.58 0.69 0.56 Non-accrual loans to total net loans 0.64 0.79 0.57 ACL - loans to non-performing loans 198 172 191 ACL - loans to non-accrual loans 237 200 241 (1) These amounts are reflected in the provision for credit losses in the Consolidated Statements of Income.
The increase in average net loans was primarily due to approximately $2.4 billion of total loans acquired in the Republic First Transaction and outstanding as of December 31, 2024.
The increase in average net loans was primarily due to approximately $2.4 billion of total loans acquired in the Republic First Transaction and outstanding as of December 31, 2024. The yield on total loans increased 51 bps to 6.08% in 2024 compared to 5.57% in 2023.
In November 2024, the Corporation retired $168.8 million of subordinated notes issued in November 2014 and June 2015 which matured on November 15, 2024. See "Note 10 - Borrowings" of the Notes to Consolidated Financial Statements for additional details. Provision for Credit Losses The provision for credit losses was $71.6 million in 2024 compared to $54.0 million in 2023.
Average borrowings and other interest-bearing liabilities decreased $490.9 million during 2024 compared to 2023. In November 2024, the Corporation retired $168.8 million of subordinated notes issued in November 2014 and June 2015, which matured on November 15, 2024. See "Note 10 - Borrowings" of the Notes to Consolidated Financial Statements for additional details.
The following table summarizes the contractual purchase obligations for each of the next five years (dollars in thousands): Year 2025 $ 28,062 2026 25,392 2027 7,365 2028 6,713 2029 4,835 Total $ 72,367 The Corporation is a party to financial instruments with OBS risk in the normal course of business to meet the financing needs of its customers.
The following table summarizes the contractual purchase obligations for each of the next five years (dollars in thousands): Year 2026 $ 29,523 2027 10,936 2028 8,425 2029 6,726 2030 — Total $ 55,610 The Corporation is a party to financial instruments with OBS risk in the normal course of business to meet the financing needs of its customers.
See "Note 5 - Loans and Allowance for Credit Losses" of the Notes to Consolidated Financial Statements for additional details. 59 The following table summarizes the allocation of the ACL - loans : December 31, 2024 December 31, 2023 December 31, 2022 ACL - loans % to Total ACL - loans (1) % to Total Net Loans (2) ACL - loans % to Total ACL - loans (1) % to Total Net Loans (2) ACL - loans % to Total ACL - loans (1) % to Total Net Loans (2) (dollars in thousands) Real estate - commercial mortgage $ 158,181 41.7 % 39.9 % $ 112,565 38.4 % 38.1 % $ 69,456 25.8 % 37.9 % Commercial and industrial 92,212 24.3 19.2 74,266 25.3 21.3 70,116 26.0 22.1 Real estate - residential mortgage 81,331 21.5 26.4 73,286 25.0 24.9 83,250 30.9 23.4 Consumer, home equity and leases and other loans 22,292 5.9 8.7 20,992 7.1 9.9 35,801 13.3 10.3 Real estate - construction 25,140 6.6 5.8 12,295 4.2 5.8 10,743 4.0 6.3 Total $ 379,156 100.0 % 100.0 % $ 293,404 100.0 % 100.0 % $ 269,366 100.0 % 100.0 % (1) Ending ACL - loan portfolio segment balance as a % of total ACL - loans.
The following table summarizes the allocation of the ACL - loans : December 31, 2025 December 31, 2024 December 31, 2023 ACL - loans % to Total ACL - loans (1) % to Total Net Loans (2) ACL - loans % to Total ACL - loans (1) % to Total Net Loans (2) ACL - loans % to Total ACL - loans (1) % to Total Net Loans (2) (dollars in thousands) Real estate - commercial mortgage $ 157,302 43.2 % 40.7 % $ 158,181 41.7 % 39.9 % $ 112,565 38.4 % 38.1 % Commercial and industrial 77,740 21.3 18.8 92,212 24.3 19.2 74,266 25.3 21.3 Real estate - residential mortgage 88,961 24.4 27.6 81,331 21.5 26.4 73,286 25.0 24.9 Consumer, home equity and leases and other loans 29,563 8.1 8.9 22,292 5.9 8.7 20,992 7.1 9.9 Real estate - construction 10,896 3.0 4.0 25,140 6.6 5.8 12,295 4.2 5.8 Total $ 364,462 100.0 % 100.0 % $ 379,156 100.0 % 100.0 % $ 293,404 100.0 % 100.0 % (1) Ending ACL - loan portfolio segment balance as a percentage of total ACL - loans.
The discussion following this table is based on these tax-equivalent amounts. 2024 2023 2022 Average Balance Interest (1) Yield/ Rate Average Balance Interest (1) Yield/ Rate Average Balance Interest (1) Yield/ Rate (dollars in thousands) ASSETS Interest-earning assets: Net loans (2) $ 23,145,114 $ 1,406,216 6.08 % $ 20,929,302 $ 1,166,376 5.57 % $ 19,152,740 $ 765,603 4.00 % Investment securities (3) 4,486,726 143,317 3.19 4,210,010 109,325 2.59 4,364,627 106,115 2.43 Other interest-earning assets 962,971 50,578 5.25 387,360 15,346 3.96 829,705 8,115 0.98 Total interest-earning assets 28,594,811 1,600,111 5.60 25,526,672 1,291,047 5.06 24,347,072 879,833 3.61 Noninterest-earning assets: Cash and due from banks 295,156 215,649 156,050 Premises and equipment 197,823 219,315 220,982 Other assets 1,761,083 1,553,284 1,505,277 Less: ACL - loans (4) (375,743) (285,216) (257,897) Total Assets $ 30,473,130 $ 27,229,704 $ 25,971,484 LIABILITIES AND SHAREHOLDERS' EQUITY Interest-bearing liabilities: Demand deposits $ 7,049,915 $ 128,969 1.83 % $ 5,582,930 $ 62,494 1.12 % $ 5,593,942 $ 8,219 0.15 % Savings and money market deposits 7,364,106 180,455 2.45 6,616,087 122,340 1.85 6,458,165 16,642 0.26 Brokered deposits 981,060 51,691 5.27 847,795 43,635 5.15 262,359 4,097 1.56 Time deposits 3,747,029 160,744 4.29 2,170,245 63,735 2.94 1,617,804 14,871 0.92 Total interest-bearing deposits 19,142,110 521,859 2.73 15,217,057 292,204 1.92 13,932,270 43,829 0.31 Borrowings and other interest-bearing liabilities 2,280,382 100,012 4.39 2,771,330 126,746 4.54 1,358,357 39,375 2.89 Total interest-bearing liabilities 21,422,492 621,871 2.90 17,988,387 418,950 2.32 15,290,627 83,204 0.54 Noninterest-bearing liabilities: Demand deposits 5,394,518 5,939,799 7,522,304 Other liabilities 630,478 670,269 598,230 Total Liabilities 27,447,488 24,598,455 23,411,161 Shareholders' equity 3,025,642 2,631,249 2,560,323 Total Liabilities and Shareholders' Equity $ 30,473,130 $ 27,229,704 $ 25,971,484 Net interest income/net interest margin (FTE) 978,240 3.42 % 872,097 3.42 % 796,629 3.27 % Tax equivalent adjustment (17,915) (17,811) (14,995) Net interest income $ 960,325 $ 854,286 $ 781,634 (1) Presented on a fully taxable-equivalent basis using a 21% federal tax rate and statutory interest expense disallowances.
The discussion following this table is based on these tax-equivalent amounts. 2025 2024 2023 Average Balance Interest Yield/ Rate Average Balance Interest Yield/ Rate Average Balance Interest Yield/ Rate (dollars in thousands) ASSETS Interest-earning assets: Net loans (1) $ 23,995,200 $ 1,407,669 5.87 % $ 23,145,114 $ 1,406,216 6.08 % $ 20,929,302 $ 1,166,376 5.57 % Investment securities (2) 5,270,122 193,154 3.66 4,486,726 143,317 3.19 4,210,010 109,325 2.59 Other interest-earning assets 729,300 33,731 4.63 962,971 50,578 5.25 387,360 15,346 3.96 Total interest-earning assets 29,994,622 1,634,554 5.45 28,594,811 1,600,111 5.60 25,526,672 1,291,047 5.06 Noninterest-earning assets: Cash and due from banks 294,284 295,156 215,649 Premises and equipment 184,342 197,823 219,315 Other assets 1,862,326 1,761,083 1,553,284 Less: ACL - loans (3) (382,941) (375,743) (285,216) Total Assets $ 31,952,633 $ 30,473,130 $ 27,229,704 LIABILITIES AND SHAREHOLDERS' EQUITY Interest-bearing liabilities: Demand deposits $ 7,854,613 $ 139,134 1.77 % $ 7,049,915 $ 128,969 1.83 % $ 5,582,930 $ 62,494 1.12 % Savings and money market deposits 8,277,276 188,019 2.27 7,364,106 180,455 2.45 6,616,087 122,340 1.85 Brokered deposits 772,488 33,547 4.34 981,060 51,691 5.27 847,795 43,635 5.15 Time deposits 4,080,550 153,993 3.77 3,747,029 160,744 4.29 2,170,245 63,735 2.94 Total interest-bearing deposits 20,984,927 514,693 2.45 19,142,110 521,859 2.73 15,217,057 292,204 1.92 Borrowings and other interest-bearing liabilities 1,604,263 65,834 4.10 2,280,382 100,012 4.39 2,771,330 126,746 4.54 Total interest-bearing liabilities 22,589,190 580,527 2.57 21,422,492 621,871 2.90 17,988,387 418,950 2.32 Noninterest-bearing liabilities: Demand deposits 5,299,084 5,394,518 5,939,799 Other liabilities 717,729 630,478 670,269 Total Liabilities 28,606,003 27,447,488 24,598,455 Total deposits 26,284,011 1.96% 24,536,628 2.13% 21,156,856 1.38% Total interest-bearing liabilities and noninterest-bearing deposits (cost of funds) 27,888,274 2.08% 26,817,010 2.33% 23,928,186 1.75% Shareholders' equity 3,346,630 3,025,642 2,631,249 Total Liabilities and Shareholders' Equity $ 31,952,633 $ 30,473,130 $ 27,229,704 Net interest income/net interest margin (FTE) 1,054,027 3.51 % 978,240 3.42 % 872,097 3.42 % Tax equivalent adjustment (17,680) (17,915) (17,811) Net interest income $ 1,036,347 $ 960,325 $ 854,286 (1) Average balances include non-performing loans and loan fees.
The following table presents, by class segment, a summary of delinquency status and rates, as a percentage of loans in each portfolio and in total, that do not have internal risk ratings: Delinquent (1) Non-performing (2) Total December 31, December 31, December 31, December 31, December 31, December 31, 2024 2023 2024 2023 2024 2023 $ % $ % $ % $ % $ % $ % (dollars in thousands) Consumer and real estate - home equity $ 16,241 0.91 % $ 20,345 1.15 % $ 14,374 0.81 % $ 10,878 0.61 % $ 30,615 1.72 % $ 31,223 1.76 % Real estate - residential mortgage 65,539 1.03 59,983 1.13 45,901 0.72 42,029 0.79 111,440 1.76 102,012 1.92 Real estate - construction 5,302 2.42 4,636 0.37 1,406 0.64 1,535 0.12 6,708 3.06 6,171 0.50 Leases and other loans 374 0.12 868 0.26 12,017 3.81 10,011 2.98 12,391 3.93 10,879 3.23 Total $ 87,456 1.01 % $ 85,832 0.99 % $ 73,698 0.85 % $ 64,453 0.74 % $ 161,154 1.86 % $ 150,285 1.74 % (1) Includes accruing loans 30 days to 89 days past due.
The following table presents, by class segment, a summary of delinquency status and rates, as a percentage of loans in each portfolio and in total, that do not have internal risk ratings: Delinquent (1) Non-performing (2) Total December 31, December 31, December 31, December 31, December 31, December 31, 2025 2024 2025 2024 2025 2024 $ % $ % $ % $ % $ % $ % (dollars in thousands) Consumer and real estate - home equity $ 25,001 1.38 % $ 16,241 0.91 % $ 11,873 0.66 % $ 14,374 0.81 % $ 36,874 2.04 % $ 30,615 1.72 % Real estate - residential mortgage 56,158 0.84 65,539 1.03 45,569 0.68 45,901 0.72 101,727 1.53 111,440 1.76 Real estate - construction 6,253 2.58 5,302 2.42 2,012 0.83 1,406 0.64 8,265 3.40 6,708 3.06 Leases and other loans — — 374 0.12 — — 12,017 3.81 — — 12,391 3.93 Total $ 87,412 1.00 % $ 87,456 1.01 % $ 59,454 0.68 % $ 73,698 0.85 % $ 146,866 1.68 % $ 161,154 1.86 % (1) Includes accruing loans 30 days to 89 days past due.
The following table summarizes the commercial mortgage multi-family non-owner occupied loan portfolio outstanding balance, total commitment and LTV ratio by Metropolitan Statistical Area: December 31, 2024 December 31, 2023 Outstanding Balance Total Commitment Weighted Average LTV (1) Outstanding Balance Total Commitment Weighted Average LTV (1) (dollars in thousands) Philadelphia (2) $ 707,826 $ 738,256 62 % $ 467,749 $ 480,942 57 % New York (3) 124,321 130,238 64 53,153 53,642 72 Baltimore (4) 108,384 108,680 59 54,675 54,879 56 Washington, D.C.
The following table summarizes the non-owner occupied commercial mortgage multi-family loan portfolio outstanding balance, total commitment and LTV ratio by Metropolitan Statistical Area: December 31, 2025 December 31, 2024 Outstanding Balance Total Commitment Weighted Average LTV (1) Outstanding Balance Total Commitment Weighted Average LTV (1) (dollars in thousands) Philadelphia (2) $ 706,637 $ 723,133 61 % $ 707,826 $ 738,256 62 % Lancaster, PA 157,997 159,485 47 135,891 146,593 69 New York (3) 117,055 118,819 59 124,321 130,238 64 Baltimore (4) 114,523 114,523 54 108,384 108,680 59 Washington, D.C.
The increase due to changes in volume was due to an increase in average net loans, partially offset by decreases in average other interest-earning assets and investment securities. The yield on average interest-earning assets increased 145 bps in 2023 compared to 2022.
The decrease due to changes in yield was largely due to a decrease in the yield on average net loans, partially offset by an increase in the yield on average investment securities. The yield on average interest-earning assets decreased 15 bps in 2025 compared to 2024.
The reasonable and supportable forecast extends to 24 months and reverts back to an average PD rate using a straight-line reversion methodology over a 12 month period. 41 The ACL is highly sensitive to the economic forecasts used to develop the reserve. As such, the calculation of the ACL is inherently subjective and requires management to exercise judgment.
These forecasts are based on the projected performance of specific economic variables statistically correlated with historical PD rates. The reasonable and supportable forecast extends to 24 months and reverts back to an average PD rate using a straight-line reversion methodology over a 12 month period. The ACL is highly sensitive to the economic forecasts used to develop the reserve.
The ACL may include qualitative adjustments intended to capture the impact of uncertainties not reflected in the quantitative models. In determining qualitative adjustments, management considers changes in national, regional, and local economic and business conditions and their impact on the lending environment, including underwriting standards and other factors affecting credit losses over the remaining life of each loan.
In determining qualitative adjustments, management considers changes in national, regional, and local economic and business conditions and their impact on the lending environment, including underwriting standards and other factors affecting credit losses over the remaining life of each loan. The ACL for loans was $364.5 million and $379.2 million on December 31, 2025 and December 31, 2024, respectively.
Compared to December 31, 2023, total HTM securities at December 31, 2024 increased $127.6 million, or 10.1%. The increase in HTM securities at December 31, 2024 compared to December 31, 2023 was largely driven by an increase in residential mortgage-backed securities of $130.8 million.
The increase in HTM investment securities at December 31, 2025 compared to December 31, 2024 was primarily driven by an increase in residential mortgage-backed securities of $35.8 million.
Commitments and standby and commercial letters of credit do not necessarily represent future cash needs, as they may expire without being drawn. 62 The following table presents the Corporation's commitments to extend credit and letters of credit as of December 31, 2024 (dollars in thousands): Commercial and industrial $ 4,967,334 Real estate - commercial mortgage and real estate - construction 1,706,879 Real estate - home equity 2,154,382 Total commitments to extend credit $ 8,828,595 Standby letters of credit $ 279,309 Commercial letters of credit 48,993 Total letters of credit $ 328,302 63
Commitments and standby and commercial letters of credit do not necessarily represent future cash needs, as they may expire without being drawn. 63 The following table presents the Corporation's commitments to extend credit and letters of credit as of December 31, 2025 (dollars in thousands): Commercial and industrial $ 4,975,873 Real estate - commercial mortgage and real estate - construction 1,477,796 Real estate - home equity 2,256,494 Total commitments to extend credit $ 8,710,163 Standby letters of credit $ 311,697 Commercial letters of credit 29,842 Total letters of credit $ 341,539 64
Total uninsured deposits (excluding intra-Company deposits) were estimated to be $9.4 billion and $7.2 billion at December 31, 2024 and December 31, 2023, respectively. 60 The following table presents ending borrowings, by type: December 31, Increase (Decrease) 2024 2023 $ % (dollars in thousands) Federal funds purchased $ — $ 240,000 $ (240,000) N/M Federal Home Loan Bank advances 850,000 1,100,000 (250,000) (22.7) Senior debt and subordinated debt 367,316 535,384 (168,068) (31.4) Other borrowings (1) 564,732 612,142 (47,410) (7.7) Total borrowings $ 1,782,048 $ 2,487,526 $ (705,478) (28.4) % (1) Includes repurchase agreements, short-term promissory notes and capital leases.
Total uninsured deposits (excluding intra-Company deposits) were estimated to be $9.7 billion and $9.4 billion at December 31, 2025 and December 31, 2024, respectively. 61 The following table presents ending borrowings, by type: December 31, Increase (Decrease) 2025 2024 $ % (dollars in thousands) FHLB advances $ 250,000 $ 850,000 $ (600,000) (70.6) % Senior debt and subordinated debt 367,637 367,316 321 N/M Other borrowings (1) 679,738 564,732 115,006 20.4 Total borrowings $ 1,297,375 $ 1,782,048 $ (484,673) (27.2) % (1) Includes repurchase agreements, short-term promissory notes and capital leases.
The commercial mortgage multi-family non-owner occupied loan portfolio table above excludes commercial construction loans secured by multi-family property collateral with a total outstanding loan balance of $405.2 million and outstanding loan commitment of $693.4 million as of December 31, 2024. 55 The following table presents the changes in non-accrual loans for the years ended December 31: Commercial and Industrial Real Estate - Commercial Mortgage Real Estate - Construction Real Estate - Residential Mortgage Consumer and Real Estate - Home Equity Leases and Other Loans Total (dollars in thousands) Balance at December 31, 2022 $ 27,116 $ 70,161 $ 1,368 $ 26,294 $ 6,197 $ 13,307 $ 144,443 Additions 46,358 31,004 438 792 8,416 1,520 88,528 Payments (24,276) (38,296) (465) (1,881) (2,245) (554) (67,717) Charge-offs (9,246) (17,999) — (62) (7,514) (4,380) (39,201) Transfers to OREO — — — (1,793) — — (1,793) Transfers to accrual status — (65) — (2,526) (49) — (2,640) Balance at December 31, 2023 39,952 44,805 1,341 20,824 4,805 9,893 121,620 Additions 70,700 94,887 1,406 11,067 15,066 7,759 200,885 Payments (33,580) (25,757) (130) (4,780) (2,414) (825) (67,486) Charge-offs (26,585) (13,186) — (1,472) (8,490) (4,696) (54,429) Transfers to OREO (90) (133) (871) (97) (190) — (1,381) Transfers to accrual status (8,180) (1,119) — (142) (178) (297) (9,916) Balance at December 31, 2024 $ 42,217 $ 99,497 $ 1,746 $ 25,400 $ 8,599 $ 11,834 $ 189,293 During 2024, non-accrual loans increased $67.7 million, or 55.6%, largely due to additions to non-accrual loans, partially offset by payments and charge-offs.
The non-owner occupied commercial mortgage multi-family loan portfolio table above excludes commercial construction loans secured by multi-family property collateral with a total outstanding loan balance of $196.5 million and outstanding loan commitments of $388.6 million as of December 31, 2025. 56 The following table presents the changes in non-accrual loans for the years ended December 31: Commercial and Industrial Real Estate - Commercial Mortgage Real Estate - Construction Real Estate - Residential Mortgage Consumer and Real Estate - Home Equity Leases and Other Loans Total (dollars in thousands) Balance at December 31, 2023 $ 39,952 $ 44,805 $ 1,341 $ 20,824 $ 4,805 $ 9,893 $ 121,620 Additions 70,700 94,887 1,406 11,067 15,066 7,759 200,885 Payments (33,580) (25,757) (130) (4,780) (2,414) (825) (67,486) Charge-offs (26,585) (13,186) — (1,472) (8,490) (4,696) (54,429) Transfers to OREO (90) (133) (871) (97) (190) — (1,381) Transfers to accrual status (8,180) (1,119) — (142) (178) (297) (9,916) Balance at December 31, 2024 42,217 99,497 1,746 25,400 8,599 11,834 189,293 Additions 57,874 136,402 25,980 11,076 8,601 2,347 242,280 Payments (31,150) (122,440) (20,439) (6,085) (3,339) (10,647) (194,100) Charge-offs (20,787) (36,518) (5,386) (1,054) (6,261) (2,346) (72,352) Transfers to OREO — — (240) (1,271) (50) — (1,561) Transfers to accrual status (4,051) (4,891) — (315) (421) (10) (9,688) Balance at December 31, 2025 $ 44,103 $ 72,050 $ 1,661 $ 27,751 $ 7,129 $ 1,178 $ 153,872 During 2025, non-accrual loans decreased $35.4 million, or 18.7%, largely due to payments and charge-offs, partially offset by additions to non-accrual loans.
(5) 28,145 31,121 48 87,020 92,483 51 Lancaster, PA 135,891 146,593 69 159,691 169,437 66 Other 439,376 479,884 59 325,324 361,693 65 Total multi-family non-owner occupied commercial real estate $ 1,543,943 $ 1,634,772 62 % $ 1,147,612 $ 1,213,076 59 % (1) Weighted Average LTV as of origination . (2) Philadelphia-Camden-Wilmington, PA-NJ-DE-MD. (3) New York-Newark-Jersey City, NY-NJ-PA. (4) Washington-Arlington-Alexandria, DC-VA-MD-WV.
(5) 67,666 72,190 51 28,145 31,121 48 Other 425,924 477,162 57 439,376 479,884 59 Total multi-family non-owner occupied commercial real estate $ 1,589,802 $ 1,665,312 58 % $ 1,543,943 $ 1,634,772 62 % (1) Weighted average LTV as of origination . (2) Philadelphia-Camden-Wilmington, PA-NJ-DE-MD. (3) New York-Newark-Jersey City, NY-NJ-PA. (4) Baltimore-Columbia-Towson, MD. (5) Washington-Arlington-Alexandria, DC-VA-MD-WV.
December 31, 2024 December 31, 2023 $ % $ % (dollars in thousands) Multi-family $ 1,543,943 6.4 % $ 1,147,612 5.4 % Retail trade 1,097,712 4.6 893,029 4.2 Industrial 829,354 3.4 634,533 3.0 Office 761,929 3.2 640,403 3.0 Hospitality and food services 470,907 2.0 453,305 2.1 Other 527,661 2.2 498,122 2.3 Total non-owner occupied commercial mortgage loans $ 5,231,506 21.8 % $ 4,267,004 20.0 % 54 The following table summarizes the commercial mortgage office non-owner occupied loan portfolio outstanding balance, total commitment and LTV ratio by Metropolitan Statistical Area: December 31, 2024 December 31, 2023 Outstanding Balance Total Commitment Weighted Average LTV (1) Outstanding Balance Total Commitment Weighted Average LTV (1) (dollars in thousands) Philadelphia (2) $ 339,164 $ 369,758 62 % $ 241,596 $ 247,395 56 % New York (3) 96,129 100,893 59 60,149 62,565 71 Washington, D.C.
December 31, 2025 December 31, 2024 $ % of Total Net Loans $ % of Total Net Loans (dollars in thousands) Multi-family $ 1,589,802 6.6 % $ 1,543,943 6.4 % Retail trade 1,109,612 4.6 1,097,712 4.6 Industrial 944,807 3.9 829,354 3.4 Office 730,803 3.0 761,929 3.2 Hospitality and food services 450,273 1.9 470,907 2.0 Other 571,371 2.4 527,661 2.2 Total non-owner occupied commercial mortgage loans $ 5,396,668 22.4 % $ 5,231,506 21.8 % 55 The following table summarizes the commercial mortgage office non-owner occupied loan portfolio outstanding balance, total commitment and LTV ratio by Metropolitan Statistical Area: December 31, 2025 December 31, 2024 Outstanding Balance Total Commitment Weighted Average LTV (1) Outstanding Balance Total Commitment Weighted Average LTV (1) (dollars in thousands) Philadelphia (2) $ 345,981 $ 357,190 63 % $ 339,164 $ 369,758 62 % Washington, D.C.
See reconciliation of this non-GAAP financial measure to the most directly comparable GAAP measure under the "Supplemental Reporting of Non-GAAP Based Financial Measures" section of Management's Discussion. (2) Presented on a FTE basis using a 21% federal tax rate and statutory interest expense disallowances.
See reconciliation of this non-GAAP financial measure to the most directly comparable GAAP measure under the "Supplemental Reporting of Non-GAAP Based Financial Measures" section of Management's Discussion.
The assessment of the carrying value of DTAs is based on certain assumptions, the changes of which could have a material impact on the Corporation's consolidated financial statements. On a periodic basis, the Corporation evaluates its income tax expense based on tax laws, regulations and financial reporting considerations and records adjustments as appropriate.
On a periodic basis, the Corporation evaluates its income tax expense based on tax laws, regulations and financial reporting considerations and records adjustments as appropriate.
The Corporation consolidates risk migrations to identify emerging risks by industry and real estate property types, taking into consideration economic forecasts and industry trends. In 2024, the Corporation identified the office and multi-family commercial mortgage loan portfolios as posing heightened risks and consequently moderated the volume of new loan originations.
The Corporation consolidates risk migrations to identify emerging risks by industry and real estate property types, taking into consideration economic forecasts and industry trends. The Corporation takes a risk-based approach when reviewing a specific loan portfolio, such as the commercial office loan portfolio or multi-family loan portfolio.
(3) Excludes $17.5 million, $10.9 million and $6.0 million of residential mortgage properties for which formal foreclosure proceedings were in process as of December 31, 2024, 2023 and 2022, respectively. 56 The following table presents non-performing loans: December 31, 2024 2023 2022 (dollars in thousands) Real estate - commercial mortgage $ 102,359 $ 46,527 $ 72,634 Commercial and industrial 43,677 41,020 28,288 Real estate - residential mortgage 45,901 42,029 46,509 Real estate - home equity 13,349 10,079 8,809 Real estate - construction 1,746 2,876 1,368 Consumer 1,025 799 991 Leases and other loans 12,017 10,011 13,307 Total non-performing loans $ 220,074 $ 153,341 $ 171,906 Non-performing loans to total loans 0.92 % 0.72 % 0.85 % The following table presents the amortized cost basis of loans modified to borrowers experiencing financial difficulty: December 31, 2024 2023 (dollars in thousands) Real estate - commercial mortgage $ 20,501 $ 2,944 Commercial and industrial 3,913 11,970 Real estate - residential mortgage 13,969 9,092 Real estate - home equity 379 — Real estate - construction 595 — Total $ 39,357 $ 24,006 There were no loans modified due to borrowers experiencing financial difficulty that defaulted during 2024.
(3) Excludes $19.1 million, $17.5 million and $10.9 million of residential mortgage properties for which formal foreclosure proceedings were in process as of December 31, 2025, 2024 and 2023, respectively. 57 The following table presents non-performing loans: December 31, 2025 2024 2023 (dollars in thousands) Real estate - commercial mortgage $ 74,981 $ 102,359 $ 46,527 Commercial and industrial 47,756 43,677 41,020 Real estate - residential mortgage 45,569 45,901 42,029 Real estate - home equity 11,084 13,349 10,079 Real estate - construction 2,267 1,746 2,876 Consumer 791 1,025 799 Leases and other loans 1,348 12,017 10,011 Total non-performing loans $ 183,796 $ 220,074 $ 153,341 Non-performing loans to total loans 0.76 % 0.92 % 0.72 % The following table presents the amortized cost basis of loans modified to borrowers experiencing financial difficulty: December 31, 2025 2024 (dollars in thousands) Real estate - commercial mortgage $ 81,548 $ 20,501 Commercial and industrial 30,493 3,913 Real estate - residential mortgage 8,828 13,969 Real estate - home equity 372 379 Real estate - construction 30,454 595 Total $ 151,695 $ 39,357 The following table summarizes OREO, by property type: December 31, 2025 2024 2023 (dollars in thousands) Commercial properties $ 240 $ 1,888 $ 165 Residential properties 1,125 733 229 Undeveloped land — — 502 Total OREO $ 1,365 $ 2,621 $ 896 The Corporation's ability to identify potential problem loans in a timely manner is important to maintaining an adequate ACL.
Financial Statements." Financial Highlights Net Income Available to Common Shareholders and Net Income Per Share - Net income available to common shareholders was $278.5 million for the year ended December 31, 2024, a $4.5 million increase compared to $274.0 million in 2023.
(2) Presented on a FTE basis using a 21% federal tax rate and statutory interest expense disallowances. 38 Financial Highlights Net Income Available to Common Shareholders and Net Income Per Share - Net income available to common shareholders was $381.4 million for the year ended December 31, 2025, a $102.9 million increase compared to $278.5 million in 2024.
(5) Baltimore-Columbia-Towson, MD. The commercial mortgage office non-owner occupied loan portfolio table above excludes commercial construction loans secured by office property collateral with a total outstanding balance of $52.5 million and outstanding loan commitment of $57.4 million as of December 31, 2024.
(2) Philadelphia-Camden-Wilmington, PA-NJ-DE-MD. (3) Washington-Arlington-Alexandria, DC-VA-MD-WV. (4) Baltimore-Columbia-Towson, MD. (5) New York-Newark-Jersey City, NY-NJ-PA. The non-owner occupied commercial mortgage office loan portfolio table above excludes commercial construction loans secured by office property collateral with no total outstanding balance and total outstanding loan commitments of $1.1 million as of December 31, 2025.
Compared to 2022, FTE total interest income for 2023 increased $411.2 million due to increases of $344.7 million attributable to changes in yield and $66.5 million attributable to changes in volume. The increase due to changes in yield was largely due to an increase in net loans.
Compared to 2024, FTE total interest income for 2025 increased $34.4 million due to an increase of $66.5 million attributable to changes in volume, partially offset by a decrease of $32.1 million attributable to changes in yield. The increase due to changes in volume was due to an increase in average net loans and average investment securities.
Management's determination of the appropriateness of the reserve is based on periodic evaluations of the loan portfolio, lending-related commitments, current and forecasted economic factors and other relevant factors. Loans Evaluated Collectively : Loans evaluated collectively for expected credit losses include all accruing loans and non-accrual loans where the total commitment amount is less than $1 million.
Financial Statements and Supplementary Data." Allowance for Credit Losses - The ACL is based on estimated losses over the remaining expected life of loans. Management's determination of the appropriateness of the reserve is based on periodic evaluations of the loan portfolio, lending-related commitments, current and forecasted economic factors and other relevant factors.
See "Note 15 - Shareholders' Equity" in the Notes to the Consolidated Financial Statements in "Item 8. Financial Statements and Supplementary Data" for details of accumulated comprehensive loss. Regulatory Capital The Corporation and its wholly-owned subsidiary bank, Fulton Bank, are subject to the Capital Rules administered by banking regulators.
Financial Statements and Supplementary Data" for details of accumulated comprehensive loss. Regulatory Capital The Corporation and its wholly-owned subsidiary bank, Fulton Bank, are subject to the Capital Rules administered by banking regulators. Failure to meet minimum capital requirements can trigger certain actions by regulators that could have a material effect on the Corporation's financial statements.
The tax effects of these temporary differences are recognized currently in the deferred income tax provision or benefit. DTAs or deferred tax liabilities are computed based on the difference between the financial statement and income tax bases of assets and liabilities using the applicable enacted marginal tax rate.
DTAs or deferred tax liabilities are computed based on the difference between the financial statement and income tax bases of assets and liabilities using the applicable enacted marginal tax rate. 42 The Corporation must also evaluate the likelihood that DTAs will be recovered through future taxable income.
Financial Statements." Securities Restructuring In May 2024, the Corporation sold approximately $345.7 million AFS securities and recorded a pre-tax loss of $20.3 million during the second quarter of 2024. The proceeds from the sale were reinvested into higher-yielding securities of a similar type and similar duration.
In May 2024, the Corporation sold $345.7 million of AFS investment securities and recorded a pre-tax loss of $20.3 million.
The increase in AFS securities at December 31, 2024 compared to December 31, 2023 was due to increases in residential mortgage-backed 52 securities and collateralized mortgage obligations of $793.1 million and $677.5 million, respectively, partially offset by decreases in state and municipal securities and corporate debt securities of $257.1 million and $140.2 million, respectively.
The decrease in AFS investment securities at December 31, 2025 compared to December 31, 2024 was due to decreases of $223.2 million in residential mortgage-backed securities and $85.4 million in corporate debt securities, partially offset by increases of $251.2 million in collateralized mortgage obligations, $42.6 million in commercial mortgage-backed securities and $11.8 million in state and municipal securities. 53 Compared to December 31, 2024, total HTM investment securities at December 31, 2025 increased $30.3 million, or 2.2%.
Deposits and Borrowings The following table presents ending deposits, by type: December 31, Increase (Decrease) 2024 2023 $ % (dollars in thousands) Noninterest-bearing demand $ 5,499,760 $ 5,314,094 $ 185,666 3.5 % Interest-bearing demand 7,843,604 5,722,695 2,120,909 37.1 Savings and money market deposits 7,792,114 6,616,901 1,175,213 17.8 Total demand and savings 21,135,478 17,653,690 3,481,788 19.7 Brokered deposits 843,857 1,144,692 (300,835) (26.3) Time deposits 4,150,098 2,739,241 1,410,857 51.5 Total deposits $ 26,129,433 $ 21,537,623 $ 4,591,810 21.3 % During 2024, total deposits increased by $4.6 billion, or 21.3%, compared to December 31, 2023.
Deposits and Borrowings The following table presents ending deposits, by type: December 31, Increase (Decrease) 2025 2024 $ % (dollars in thousands) Noninterest-bearing demand $ 5,256,096 $ 5,499,760 $ (243,664) (4.4) % Interest-bearing demand 7,970,188 7,843,604 126,584 1.6 Savings and money market deposits 8,512,829 7,792,114 720,715 9.2 Total demand and savings 21,739,113 21,135,478 603,635 2.9 Brokered deposits 855,042 843,857 11,185 1.3 Time deposits 3,995,252 4,150,098 (154,846) (3.7) Total deposits $ 26,589,407 $ 26,129,433 $ 459,974 1.8 % During 2025, total deposits increased by $460.0 million, or 1.8%, compared to December 31, 2024.
The following table presents criticized and classified loans, or those with internal risk ratings of special mention or substandard or lower for commercial mortgages, commercial and industrial loans and construction loans to commercial borrowers, by class segment: Special Mention (1) Increase (Decrease) Substandard or Lower (2) Increase (Decrease) Total Criticized and Classified Loans December 31, December 31, December 31, 2024 2023 $ % 2024 2023 $ % 2024 2023 (dollars in thousands) Real estate - commercial mortgage $ 531,423 $ 302,553 $ 228,870 75.6% $ 522,377 $ 224,774 $ 297,603 132.4% $ 1,053,800 $ 527,327 Commercial and industrial 238,809 135,837 102,972 75.8 335,246 196,500 138,746 70.6 574,055 332,337 Real estate - construction (3) 161,310 38,520 122,790 N/M 47,183 26,771 20,412 76.2 208,493 65,291 Total $ 931,542 $ 476,910 $ 454,632 95.3% $ 904,806 $ 448,045 $ 456,761 101.9% $ 1,836,348 $ 924,955 % of total risk-rated loans 6.1% 3.5% 5.9% 3.3% 11.9% 6.8% (1) Considered "criticized" loans by banking regulators.
The following table presents criticized and classified loans, or those with internal risk ratings of special mention or substandard or lower for commercial mortgages, commercial and industrial loans, construction loans to commercial borrowers and leases and other loans by class segment: Special Mention (1) Increase (Decrease) Substandard or Lower (2) Increase (Decrease) Total Criticized and Classified Loans December 31, December 31, December 31, 2025 2024 $ % 2025 2024 $ % 2025 2024 (dollars in thousands) Real estate - commercial mortgage $ 412,685 $ 531,423 $ (118,738) (22.3) % $ 531,491 $ 522,377 $ 9,114 1.7 % $ 944,176 $ 1,053,800 Commercial and industrial 220,022 238,809 (18,787) (7.9) 243,786 335,246 (91,460) (27.3) 463,808 574,055 Real estate - construction (3) 30,416 161,310 (130,894) (81.1) 9,142 47,183 (38,041) (80.6) 39,558 208,493 Leases and other loans 3,415 — 3,415 N/M 6,487 — 6,487 N/M 9,902 — Total $ 666,538 $ 931,542 $ (265,004) (28.4) % $ 790,906 $ 904,806 $ (113,900) (12.6) % $ 1,457,444 $ 1,836,348 % of total risk-rated loans 4.3% 6.1% 5.1% 5.9% 9.4% 11.9% (1) Considered "criticized" loans by banking regulators.
The increase in income tax expense in 2023 resulted primarily from the higher ETR.
The increase in income tax expense in 2025 was primarily due to higher taxable income.
The increase in net loans during 2024 was primarily due to $2.4 billion of net loans acquired in the Republic First Transaction and outstanding as of December 31, 2024. The overall increase in net loans was largely due to increases in commercial mortgage loans and residential mortgage loans, of $1.5 billion and $1.0 billion, respectively.
During 2025, net loans increased $100.0 million, or 0.4%, compared to December 31, 2024. The increase in net loans during 2025 was primarily due to increases in residential mortgage loans and commercial mortgage loans of $320.4 million and $219.1 million, respectively, partially offset by a decrease in construction loans of $424.6 million.
The increase in average deposits occurred primarily in average time deposits, average interest-bearing demand deposits and average savings and money market deposits, which increased $1.6 billion, $1.5 billion and $748.0 million, respectively, partially offset by a decrease in average noninterest-bearing demand deposits of $545.3 million.
The increase in total deposits was primarily due to increases in savings and money market deposits and interest-bearing demand deposits of $720.7 million and $126.6 million respectively, partially offset by decreases in noninterest-bearing demand deposits and time deposits of $243.7 million and $154.8 million, respectively.
Shareholders' Equity During 2024, total shareholders' equity increased $437.2 million, or 15.8%, to $3.2 billion, or 10.0% of total assets, as of December 31, 2024.
Other Liabilities During 2025, other liabilities decreased $221.8 million, or 23.0%, compared to December 31, 2024, primarily due to decreases in derivative-related liabilities, accrued taxes and other accrued expenses and payables. Shareholders' Equity During 2025, total shareholders' equity increased $293.1 million, or 9.2%, to $3.5 billion, or 10.9% of total assets, as of December 31, 2025.
See additional information regarding these critical accounting policies in "Note 1 - Summary of Significant Accounting Policies," in the Notes to the Consolidated Financial Statements in "Item 8. Financial Statements and Supplementary Data." Allowance for Credit Losses - The ACL is based on estimated losses over the remaining expected life of loans.
The following is a summary of those accounting policies that the Corporation considers to be most important to the presentation of its financial condition and results of operations. See additional information regarding these critical accounting policies in "Note 1 - Summary of Significant Accounting Policies," in the Notes to the Consolidated Financial Statements in "Item 8.
(2) Considered "classified" loans by banking regulators. (3) Excludes construction - other. Total criticized and classified loans increased $911.4 million, or 98.5%, compared to December 31, 2023.
(2) Considered "classified" loans by banking regulators. (3) Excludes non-commercial real estate - construction. Total criticized and classified loans decreased $378.9 million, or 20.6%, compared to December 31, 2024. Special mention loans decreased $265.0 million as of December 31, 2025 compared to December 31, 2024.
Loans The following table presents ending net loans outstanding, by type: December 31, Increase (Decrease) 2024 2023 $ % (dollars in thousands) Real estate - commercial mortgage $ 9,601,858 $ 8,127,728 $ 1,474,130 18.1 % Commercial and industrial (1) 4,605,589 4,545,552 60,037 1.3 Real estate - residential mortgage 6,349,643 5,325,923 1,023,720 19.2 Real estate - home equity 1,160,616 1,047,184 113,432 10.8 Real estate - construction 1,394,899 1,239,075 155,824 12.6 Consumer 616,856 729,318 (112,462) (15.4) Leases and other loans (2) 315,458 336,314 (20,856) (6.2) Net loans $ 24,044,919 $ 21,351,094 $ 2,693,825 12.6 % (1) Includes no unearned income for December 31, 2024 and $41.0 thousand at December 31, 2023.
Loans The following table presents ending net loans outstanding, by type: December 31, Increase (Decrease) 2025 2024 $ % (dollars in thousands) Real estate - commercial mortgage $ 9,820,944 $ 9,601,858 $ 219,086 2.3 % Commercial and industrial 4,539,060 4,605,589 (66,529) (1.4) Real estate - residential mortgage 6,669,993 6,349,643 320,350 5.0 Real estate - home equity 1,242,831 1,160,616 82,215 7.1 Real estate - construction 970,298 1,394,899 (424,601) (30.4) Consumer 564,349 616,856 (52,507) (8.5) Leases and other loans (1) 337,409 315,458 21,951 7.0 Net loans $ 24,144,884 $ 24,044,919 $ 99,965 0.4 % (1) Includes unearned income of $36.8 million and $35.6 million as of December 31, 2025 and 2024, respectively.
The ETR is generally lower than the federal statutory rate of 21% due to tax-exempt interest income earned on loans, investments in tax-free municipal securities and TCIs that generate tax credits under various federal programs. 51 FINANCIAL CONDITION The table below presents condensed consolidated ending balance sheets: December 31, Increase (Decrease) 2024 2023 $ % (dollars in thousands) Assets Cash and cash equivalents $ 1,063,871 $ 549,710 $ 514,161 93.5 % FRB and FHLB Stock 139,574 124,405 15,169 12.2 Loans held for sale 25,618 15,158 10,460 69.0 Investment securities 4,806,468 3,666,274 1,140,194 31.1 Net loans, less ACL - loans 23,665,763 21,057,690 2,608,073 12.4 Net premises and equipment 195,527 222,881 (27,354) (12.3) Goodwill and net intangible assets 635,458 560,687 74,771 13.3 Other assets 1,539,531 1,375,110 164,421 12.0 Total Assets $ 32,071,810 $ 27,571,915 $ 4,499,895 16.3 % Liabilities and Shareholders' Equity Deposits $ 26,129,433 $ 21,537,623 $ 4,591,810 21.3 % Borrowings 1,782,048 2,487,526 (705,478) (28.4) Other liabilities 963,004 786,627 176,377 22.4 Total Liabilities 28,874,485 24,811,776 4,062,709 16.4 Total Shareholders' Equity 3,197,325 2,760,139 437,186 15.8 Total Liabilities and Shareholders' Equity $ 32,071,810 $ 27,571,915 $ 4,499,895 16.3 % Investment Securities The table below presents the carrying amount of investment securities: December 31, Increase (Decrease) 2024 2023 $ % (dollars in thousands) Available for Sale U.S.
The ETR is generally lower than the federal statutory rate of 21% due to tax-exempt interest income earned on loans, investments in tax-free municipal securities and TCIs that generate tax credits under various federal programs. 52 FINANCIAL CONDITION The table below presents condensed consolidated ending balance sheets: December 31, Increase (Decrease) 2025 2024 $ % (dollars in thousands) Assets Cash and cash equivalents $ 1,061,609 $ 1,063,871 $ (2,262) (0.2) % FRB and FHLB Stock 121,009 139,574 (18,565) (13.3) Loans held for sale 16,316 25,618 (9,302) (36.3) Investment securities 4,833,744 4,806,468 27,276 0.6 Net loans, less ACL - loans 23,780,422 23,665,763 114,659 0.5 Net premises and equipment 175,240 195,527 (20,287) (10.4) Goodwill and intangible assets 612,996 635,458 (22,462) (3.5) Other assets 1,517,064 1,539,531 (22,467) (1.5) Total Assets $ 32,118,400 $ 32,071,810 $ 46,590 0.1 % Liabilities and Shareholders' Equity Deposits $ 26,589,407 $ 26,129,433 $ 459,974 1.8 % Borrowings 1,297,375 1,782,048 (484,673) (27.2) Other liabilities 741,171 963,004 (221,833) (23.0) Total Liabilities 28,627,953 28,874,485 (246,532) (0.9) Total Shareholders' Equity 3,490,447 3,197,325 293,122 9.2 Total Liabilities and Shareholders' Equity $ 32,118,400 $ 32,071,810 $ 46,590 0.1 % Investment Securities The table below presents the carrying amount of investment securities: December 31, Increase (Decrease) 2025 2024 $ % (dollars in thousands) Available for Sale State and municipal securities $ 826,693 $ 814,887 $ 11,806 1.4 % Corporate debt securities 214,921 300,370 (85,449) (28.4) Collateralized mortgage obligations 1,040,078 788,885 251,193 31.8 Residential mortgage-backed securities 766,717 989,875 (223,158) (22.5) Commercial mortgage-backed securities 559,450 516,882 42,568 8.2 Total AFS investment securities $ 3,407,859 $ 3,410,899 $ (3,040) (0.1) % Held to Maturity Residential mortgage-backed securities $ 573,636 $ 537,856 $ 35,780 6.7 % Commercial mortgage-backed securities 852,249 857,713 (5,464) (0.6) Total HTM investment securities $ 1,425,885 $ 1,395,569 $ 30,316 2.2 % Total investment securities $ 4,833,744 $ 4,806,468 $ 27,276 0.6 % Compared to December 31, 2024, total AFS investment securities at December 31, 2025 decreased $3.0 million, or 0.1%.
Excluding acquisition-related expenses of $10.3 million in 2022 and FultonFirst initiatives of $3.2 million in 2023, non-interest expense increased $52.6 million, or 8.4%, in 2023 compared to 2022.
Excluding the gain on the Sale-Leaseback Transaction, acquisition-related expenses and FultonFirst implementation and asset disposal costs, non-interest expense increased $18.0 million, or 2.3%, in 2025 compared to 2024.
In 2023, interest expense increased $335.7 million compared to 2022, primarily driven by an increase in rate on interest-bearing liabilities resulting in a $252.9 million increase in interest expense.
In 2025, total interest expense decreased $41.3 million compared to 2024, driven by a decrease in rate on interest-bearing liabilities resulting in a $53.0 million decrease in interest expense, partially offset by an increase in average interest-bearing liabilities resulting in a $11.6 million increase in interest expense.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

30 edited+3 added−5 removed13 unchanged
Biggest changeThe following table summarizes the expected impact of interest rate changes in rate-ramp scenarios over a 12-month period, that is, a gradual non-parallel shift, on net interest income as of December 31, 2024: Rate Ramp (1) Annual change in net interest income % change in net interest income +400 bp + $29.4 million +2.6% +300 bp + $25.0 million +2.2% +200 bp + $19.2 million +1.7% +100 bp + $11.8 million +1.1% –100 bp - $7.3 million -0.7% –200 bp - $14.3 million -1.3% –300 bp - $21.4 million -1.9% –400 bp - $29.0 million -2.6% (1) These results include the effect of implicit and explicit interest rate floors that limit further reduction in interest rates. 64 The following table summarizes the expected impact of abrupt interest rate changes, i.e. a non-parallel instantaneous shock, on net interest income as of December 31, 2024: Rate Shock (1) Annual change in net interest income % Change in net interest income +400 bp +$46.6 million +4.2% '+300 bp + $41.1 million + 3.7% '+200 bp + $35.3 million + 3.2% '+100 bp + $27.4 million + 2.5% '-100 bp - $18.7 million - 1.7% '-200 bp - $32.6 million - 2.9% -300 bp - $49.3 million - 4.4% -400 bp - $66.4 million -6.0% (1) These results include the effect of implicit and explicit interest rate floors that limit further reduction in interest rates.
Biggest changeThe following table summarizes the expected impact of abrupt interest rate changes, that is a parallel instantaneous shock, on net interest income as of December 31, 2025: Rate Shock (1) Annual change in net interest income % change in net interest income +400 bp +$59.0 million +5.3% '+300 bp + $49.3 million + 4.4% '+200 bp + $37.1 million + 3.3% '+100 bp + $23.8 million + 2.1% '-100 bp - $14.3 million - 1.3% '-200 bp - $28.8 million - 2.6% -300 bp - $46.3 million - 4.1% (1) Results include the effect of implicit and explicit interest rate floors that limit further reduction in interest rates.
First, changes in rates have an impact on the Corporation's liquidity position and could affect its ability to meet obligations and continue to grow. Second, movements in interest rates can create fluctuations in the Corporation's net interest income and changes in its economic value of its equity.
First, changes in rates have an impact on the Corporation's liquidity position and could affect its ability to meet obligations and continue to grow. Second, movements in interest rates can create fluctuations in the Corporation's net interest income and changes in the economic value of its equity.
The Corporation's investment portfolio consists mainly of state and municipal securities, commercial mortgage-backed securities, residential mortgage-backed securities, corporate debt securities and collateralized mortgage obligations. Commercial mortgage-backed securities, residential mortgage-backed securities and collateralized mortgage obligations have stated maturities that may differ from actual maturities due to borrowers' ability to prepay obligations.
The Corporation's investment portfolio consists of residential mortgage-backed securities, commercial mortgage-backed securities, collateralized mortgage obligations, state and municipal securities and corporate debt securities. Commercial mortgage-backed securities, residential mortgage-backed securities and collateralized mortgage obligations have stated maturities that may differ from actual maturities due to borrowers' ability to prepay obligations.
The assumptions used are inherently uncertain and, as a result, the model cannot precisely measure future net interest income or precisely predict the impact of fluctuations in market interest rates on net interest income.
The assumptions used are inherently uncertain and, as a result, the model cannot precisely predict future net interest income or precisely predict the impact of fluctuations in market interest rates on net interest income.
The Corporation uses two complementary methods to measure and manage interest rate risk. They are a simulation of net interest income and estimates of economic value of equity. Using these measurements in tandem provides a reasonably comprehensive summary of the magnitude of the Corporation's interest rate risk, level of risk as time evolves, and exposure to changes in interest rates.
The Corporation uses two complementary methods to measure and manage interest rate risk: simulation of net interest income and estimates of economic value of equity. Using these measurements in tandem provides a reasonably comprehensive summary of the magnitude of the Corporation's interest rate risk, level of risk as time evolves, and exposure to changes in interest rates.
As the hedged transaction continues to be probable, the unrealized losses that have been recorded in AOCI will be recognized as reduction to interest income, including fees, when the previously forecasted hedged item affects earnings in future periods.
As the hedged transaction continues to be probable, the unrealized losses that have been recorded in AOCI are recognized as reduction to interest income, including fees, when the previously forecasted hedged item affects earnings in future periods.
State and municipal securities can be supported by the general obligation of the issuing state or municipality, allowing the securities to be repaid by any means available to the issuing state or municipality. As of December 31, 2024, approximately 100% of state and municipal securities were supported by the general obligation of corresponding states or municipalities.
State and municipal securities can be supported by the general obligation of the issuing state or municipality, allowing the securities to be repaid by any means available to the issuing state or municipality. As of December 31, 2025, approximately 100% of state and municipal securities were supported by the general obligation of corresponding states or municipalities.
Advances from the FHLB, when utilized, are secured by qualifying commercial real estate and residential mortgage loans, investments and other assets. As of December 31, 2024, the Corporation had aggregate federal funds lines borrowing capacity of $2.6 billion with no amounts outstanding against that amount.
Advances from the FHLB, when utilized, are secured by qualifying commercial real estate and residential mortgage loans, investments and other assets. As of December 31, 2025, the Corporation had aggregate federal funds lines borrowing capacity of $2.6 billion with no amount outstanding against that amount.
The Corporation's policy limits the economic value of equity that may be at risk, in a non-parallel instantaneous shock, to 10% of the base case economic value of equity for a 100 bps shock in interest rates, 20% for a 200 bps shock, 30% for a 300 bps shock and 40% for a 400 bps shock.
The Corporation's policy limits the economic value of equity that may be at risk, in a parallel instantaneous shock, to: • 10% of the base-case economic value of equity for a 100 bps shock, • 20% for a 200 bps shock, • 30% for a 300 bps shock, and • 40% for a 400 bps shock.
To accomplish this objective, the Corporation primarily uses interest rate derivatives as part of its interest rate risk management strategy. The Corporation enters into interest rate derivatives designated as cash flow hedges to hedge the variable cash flows associated with existing floating rate loans and borrowings.
To accomplish this objective, the Corporation primarily uses 66 interest rate derivatives as part of its interest rate risk management strategy. The Corporation enters into interest rate derivatives designated as cash flow hedges to hedge cash flows associated with existing loans and borrowings.
Approximately 74% of these securities were school district issuances, which are also supported by the states of the issuing municipalities. 69
Approximately 74% of these securities were school district issuances, which are also supported by the states of the issuing municipalities. 70
Fulton Bank is a member of the FHLB and has access to FHLB overnight and term credit facilities. As of December 31, 2024, the Bank had total borrowing capacity of approximately $11.1 billion with $5.1 billion of advances and letters of credit outstanding, for a remaining available borrowing capacity of approximately $6.0 billion.
Fulton Bank is a member of the FHLB and has access to FHLB overnight and term credit facilities. As of December 31, 2025, the Bank had total borrowing capacity of approximately $11.6 billion with $4.5 billion of advances and letters of credit outstanding, for a remaining available borrowing capacity of approximately $7.1 billion.
As of December 31, 2024, the Corporation was within economic value of equity policy limits for every 100 bps shock. Interest Rate Derivatives The Corporation enters into interest rate derivatives with certain qualifying commercial loan customers to meet their interest rate risk management needs.
As of December 31, 2025, the Corporation was within economic value of equity policy limits for every 100 bps parallel instantaneous shock presented. Interest Rate Derivatives The Corporation enters into interest rate derivatives with certain qualifying commercial loan customers to meet their interest rate risk management needs.
This measurement tool is used primarily to evaluate the longer-term repricing risks and options in the Corporation's balance sheet.
This measurement tool is used primarily to evaluate the longer-term repricing risks and options in the Corporation's Consolidated Balance Sheets.
A "shock" is an immediate upward or downward movement of interest rates. The shocks do not take into account changes in customer behavior that could result in changes to mix and/or volumes in the balance sheet, nor does it take into account the potential effects of competition on the pricing of deposits and loans over the forward 12-month period.
A "shock" is an immediate upward or downward movement of interest rates. These shocks do not incorporate potential changes in customer behavior that could result in changes to mix and/or volumes in the balance sheet, nor do they consider the potential effects of competition on the pricing of deposits and loans over the forward 12-month period.
Simulation of net interest income is performed for the next 12-month period. A variety of interest rate scenarios are used to measure the effects of sudden and gradual movements upward and downward in the yield curve. These results are compared to the results obtained in a flat or unchanged interest rate scenario.
Net interest income simulation is performed for the following 12-month period using various interest rate scenarios. These scenarios measure the effects of sudden and gradual parallel movements upward and downward in the yield curve and are compared to results under a flat or unchanged interest rate scenario.
The Corporation's debt security investments consist primarily of U.S. government-sponsored agency issued mortgage-backed securities and collateralized mortgage obligations, state and municipal securities, and corporate debt securities. All of the Corporation's investments in mortgage-backed securities and collateralized mortgage obligations have principal payments that are guaranteed by U.S. government-sponsored agencies.
The Corporation's debt security investments consist primarily of GSEs issued mortgage-backed securities and collateralized mortgage obligations, state and municipal securities, and corporate debt securities. All of the Corporation's investments in mortgage-backed securities and collateralized mortgage obligations have principal payments that are guaranteed by GSEs.
State and Municipal Securities As of December 31, 2024, the Corporation owned securities issued by various states and municipalities with a total fair value of $0.8 billion. Uncertainty with respect to the financial strength of state and municipal bond insurers places emphasis on the underlying strength of issuers.
State and Municipal Securities As of December 31, 2025, the Corporation owned investment securities issued by various states and municipalities with a total fair value of $826.7 million. Uncertainty with respect to the financial strength of state and municipal bond insurers places emphasis on the underlying strength of issuers.
Amounts reported in AOCI related to derivatives will be reclassified to interest income or interest expense as interest payments are made on the Corporation's loans or borrowings. On October 10, 2024, the Corporation terminated interest rate derivatives designated as cash flow hedges with a combined notional amount of $250 million.
Amounts reported in AOCI related to derivatives will be reclassified to interest income or interest expense as interest payments are made on the Corporation's loans or borrowings. In January 2023, the Corporation terminated interest rate derivatives designated as cash flow hedges with a combined notional amount of $1.0 billion.
Economic value of equity estimates the discounted present value of asset and liability cash flows. Discount rates are based upon market prices for like assets and liabilities. Abrupt changes or "shocks" in interest rates, both upward and downward, are used to determine the comparative effect of such interest rate movements relative to the unchanged environment.
The economic value of equity analysis estimates the discounted present value of asset and liability cash flows, using discount rates derived from market pricing for like assets and liabilities. Abrupt changes or "shocks" in interest rates, both upward and downward, are applied to evaluate the comparative effect of such interest rate movements relative to the unchanged environment.
For safety and soundness reasons, banking regulations limit the amount of cash that can be transferred from subsidiary banks to the parent company in the form of loans and dividends. Generally, these limitations are based on the subsidiary banks’ regulatory capital levels and their net income.
Liquidity must also be managed at the Parent Company. For safety and soundness reasons, banking regulations limit the amount of cash that can be transferred from a subsidiary bank to its parent company in the form of loans and dividends. Generally, these limitations are based on the subsidiary bank's regulatory capital levels and its net income.
The Corporation's policy limits the potential exposure of net interest income, in a non-parallel instantaneous shock, to 10% of the base case net interest income for a 100 bps shock in interest rates, 15% for a 200 bps shock, 20% for a 300 bps shock and 25% for a 400 bps shock .
Under the revised policy, the potential exposure of net interest income, under a parallel instantaneous shock, is limited to: • 10% of base-case net interest income for a 100 bps shock, • 15% for a 200 bps shock, • 20% for a 300 bps shock, and • 25% for a 400 bps shock.
Contractual maturities of time deposits as of December 31, 2024 were as follows (dollars in thousands): Year 2025 $ 3,801,297 2026 242,638 2027 40,071 2028 10,130 2029 11,908 Thereafter 44,054 Total $ 4,150,098 Contractual maturities of the portion of time deposits estimated to be in excess of the FDIC insurance limit as of December 31, 2024 included in the table above, were as follows (dollars in thousands): Three months or less $ 121,877 Over three through six months 108,934 Over six through twelve months 194,862 Over twelve months 13,867 Total $ 439,540 Total uninsured deposits (excluding intra-Company deposits) were estimated to be $9.4 billion at December 31, 2024 compared with $7.2 billion at December 31, 2023. 68 Debt Security Market Price Risk Debt security market price risk is the risk that changes in the values of debt securities, unrelated to interest rate changes, could have a material impact on the financial position or results of operations of the Corporation.
The scheduled maturities of time deposits as of December 31, 2025 were as follows (dollars in thousands): Year 2026 $ 3,528,876 2027 291,166 2028 114,925 2029 12,464 2030 8,151 Thereafter 39,670 Total $ 3,995,252 The scheduled maturities of the portion of time deposits estimated to be in excess of the FDIC insurance limit as of December 31, 2025 included in the table above, were as follows (dollars in thousands): Three months or less $ 159,874 Over three through six months 133,817 Over six through twelve months 166,734 Over twelve months 27,913 Total $ 488,338 Total uninsured deposits (excluding intra-Company deposits) were estimated to be $9.7 billion at December 31, 2025 compared with $9.4 billion at December 31, 2024. 69 Debt Security Market Price Risk Debt security market price risk is the risk that changes in the values of debt securities, unrelated to interest rate changes, could have a material impact on the financial position or results of operations of the Corporation.
Contractual maturities and repricing opportunities of loans are incorporated in the simulation model as are prepayment assumptions, maturity data and call options within the investment portfolio. Assumptions based on past experience are incorporated into the model for non-maturity deposit accounts.
Rate shocks resulting in negative interest rates that have been deemed impractical are omitted from presentation. The simulation model incorporates contractual maturities and repricing opportunities for loans as well as prepayment assumptions, maturity data and call options embedded in the investment portfolio. Assumptions for non-maturity deposit accounts based on historical experience are incorporated into the model.
During the years ended December 31, 2024 and 2023, $27.9 million and $22.1 million, respectively, of these unrealized losses have been reclassified as a reduction of interest income on loans, including fees, on the consolidated statements of income. 65 In the fourth quarter of 2024, the Corporation executed $900.0 million of receive fixed, pay floating interest rate derivatives that qualify as cash flow hedges of interest rate risk to manage the Corporation's exposure to interest rate movements.
During the years ended December 31, 2025, 2024 and 2023, $13.0 million, $27.9 million and $22.1 million, respectively, of these unrealized losses have been reclassified as a reduction of interest income on loans, including fees, on the Consolidated Statements of Income.
The Corporation has commitments to extend credit and letters of credit. As of December 31, 2024, the balance of commitments to extend credit was $8.8 billion and total letters of credit were $0.3 billion. Liquidity must also be managed at the Parent Company level.
Securities carried at $0.4 billion at December 31, 2025 and $0.3 billion at December 31, 2024 were pledged as collateral to secure public and trust deposits. The Corporation has commitments to extend credit and letters of credit. As of December 31, 2025, the balance of commitments to extend credit was $8.7 billion and total letters of credit were $0.3 billion.
A combination of commercial real estate loans, commercial loans, consumer loans and securities are pledged to the FRB of Philadelphia to provide access to FRB discount window borrowings. Securities carried at $0.3 billion at December 31, 2024 and $0.4 billion at December 31, 2023 were pledged as collateral to secure public and trust deposits.
As of December 31, 2025, the Corporation had $3.9 billion of collateralized borrowing capacity at the FRB discount window with no amount outstanding against this amount. A combination of commercial real estate loans, commercial loans, consumer loans and securities are pledged to the FRB of Philadelphia to provide access to FRB discount window borrowings.
Net cash used by financing activities was $1.5 billion, due largely to $2.1 billion in repayment of borrowings. 66 The following table presents the expected maturities of government, state and municipal and corporate AFS investment securities, at estimated fair value, as of December 31, 2024 and the weighted average yields on such securities (calculated based on historical cost): Maturing Within One Year After One But Within Five Years After Five But Within Ten Years After Ten Years Amount Yield Amount Yield Amount Yield Amount Yield Available for sale (dollars in thousands) State and municipal (1) $ 969 6.10% $ — —% $ 111,762 3.88% $ 702,156 3.85% Corporate debt securities 14,564 3.52 102,912 5.54 182,894 4.53 — — Total $ 15,533 3.68 % $ 102,912 5.54 % $ 294,656 4.28 % $ 702,156 3.85 % (1) Weighted average yields on tax-exempt securities have been computed on a FTE basis assuming a federal tax rate of 21% and statutory interest expense disallowances.
Financial Statements and Supplementary Data" for details of cash flow activity. 67 The following table presents the expected maturities of AFS state and municipal and corporate debt securities, at estimated fair value, as of December 31, 2025 and the weighted average yields on such securities (calculated based on historical cost): Maturing Within One Year After One But Within Five Years After Five But Within Ten Years After Ten Years Amount Yield Amount Yield Amount Yield Amount Yield AFS (dollars in thousands) State and municipal (1) $ 5,832 3.32 % $ 1,640 4.66 % $ 114,451 3.91 % $ 704,770 3.92 % Corporate debt securities — — 112,311 6.34 102,610 4.97 — — Total $ 5,832 3.32 % $ 113,951 6.32 % $ 217,061 4.42 % $ 704,770 3.92 % (1) Weighted average yields on tax-exempt securities have been computed on a FTE basis assuming a federal tax rate of 21% and statutory interest expense disallowances.
Simulation of net interest income is used primarily to measure the Corporation's short-term earnings exposure to rate movements.
Simulation of net interest income is used primarily to assess the Corporation's short-term earnings exposure to rate movements. During the first quarter of 2025, the Corporation revised its policy to measure its interest rate risk profile using parallel instantaneous shocks, rather than non-parallel instantaneous shocks.
The Corporation's operating activities during 2024 generated $416.6 million of cash, mainly due to net income of $288.7 million. Cash provided in investing activities was $1.6 billion, primarily due to $1.0 billion of net cash received for acquisitions in the Republic First Transaction.
The Corporation's operating activities during 2025 generated $304.5 million of cash, mainly due to net income of $391.6 million. Cash used in investing activities was $82.2 million, primarily due to the net change in loans of $101.8 million.
Removed
Actual results will differ from the model's simulated results due to timing, amount and frequency of interest rate changes as well as changes in market conditions and the application and timing of various management strategies.
Added
Actual results will differ from the model's simulated results due to timing, amount and frequency of interest rate changes as well as changes in market conditions and the application and timing of various management strategies. 65 The following table summarizes the expected impact of interest rate changes in rate-ramp scenarios over a 12-month period, that is, a gradual parallel shift, on net interest income as of December 31, 2025: Rate Ramp (1) Annual change in net interest income % change in net interest income +400 bp + $28.7 million +2.6% +300 bp + $23.6 million + 2.1% +200 bp + $17.6 million + 1.6% +100 bp + $10.7 million + 1.0% –100 bp - $5.9 million - 0.5% –200 bp - $10.4 million - 0.9% –300 bp - $14.9 million - 1.3% (1) Results include the effect of implicit and explicit interest rate floors that limit further reduction in interest rates.
Removed
As the hedged transaction continues to be probable, the unrealized losses will be recorded in AOCI and will be recognized as an increase to interest expense when the previously forecasted hedged items affects earnings in future periods.
Added
Net cash used by financing activities was $224.6 million, due largely to $485.0 million in repayment of borrowings and $141.2 million of dividends paid, partially offset by a $460.0 million increase in net deposits. See "The Consolidated Statement of Cash Flows" in "Item 8.
Removed
During the year ended December 31, 2024, $0.2 million of these unrealized losses have been reclassified as an increase to interest expense on borrowings, on the consolidated statements of income. In January 2023, the Corporation terminated interest rate derivatives designated as cash flow hedges with a combined notional amount of $1.0 billion.
Added
The following table presents AFS residential mortgage-backed securities, commercial mortgage-backed securities and collateralized mortgage obligations, at estimated fair value, and HTM residential mortgage-backed securities and commercial mortgage-backed securities, at amortized cost, as of December 31, 2025, without stated maturities, including the weighted average yields and estimated weighted average lives based on prepayment speeds on such securities: Weighted Amount Yield Average Life (dollars in thousands) (in years) AFS Residential mortgage-backed securities $ 766,717 4.60 % 4.7 Commercial mortgage-backed securities 559,450 2.71 7.7 Collateralized mortgage obligations 1,040,078 5.16 2.7 HTM Residential mortgage-backed securities $ 573,636 3.51 % 6.5 Commercial mortgage-backed securities 852,249 1.51 6.5 68 The following table presents the contractual maturities of fixed rate loans and loan types subject to changes in interest rates as of December 31, 2025: One Year or Less After One Through Five Years After Five Through Fifteen Years After 15 Years Total (dollars in thousands) Commercial and industrial: Adjustable and variable rate $ 1,035,923 $ 2,257,921 $ 397,570 $ 9,943 $ 3,701,357 Fixed rate 329,563 433,589 68,186 6,365 837,703 Total commercial and industrial 1,365,486 2,691,510 465,756 16,308 4,539,060 Real estate - mortgage (1) : Adjustable and variable rate 3,107,233 5,528,383 2,718,855 368,763 11,723,234 Fixed rate 1,363,846 2,219,499 1,754,679 672,510 6,010,534 Total real estate - mortgage (1) 4,471,079 7,747,882 4,473,534 1,041,273 17,733,768 Real estate - construction: Adjustable and variable rate 284,048 350,086 53,155 2,267 689,556 Fixed rate 242,153 37,837 687 65 280,742 Total real estate - construction 526,201 387,923 53,842 2,332 970,298 Consumer, leases and other: Adjustable and variable rate 26,549 54,907 127 — 81,583 Fixed rate 288,235 474,244 94,292 199 856,970 Total consumer, leases and other 314,784 529,151 94,419 199 938,553 Unearned income — (36,795) — — (36,795) Total $ 6,677,550 $ 11,319,671 $ 5,087,551 $ 1,060,112 $ 24,144,884 (1) Includes commercial mortgages, residential mortgages and home equity loans.
Removed
As of December 31, 2024, the Corporation had $3.1 billion of collateralized borrowing capacity at the FRB discount window with no amounts outstanding and had no borrowings drawn against the Bank Term Funding Program facility, which expired March 11, 2024.
Removed
The following table presents AFS residential mortgage-backed securities, commercial mortgage-backed securities and collateralized mortgage obligations, at estimated fair value, and HTM residential mortgage-backed securities and commercial mortgage-backed securities, at amortized cost, as of December 31, 2024, without stated maturities, including the weighted average yields and estimated weighted average lives based on prepayment speeds on such securities: Weighted Amount Yield Average Life (dollars in thousands) (in years) Available for sale Residential mortgage-backed securities $ 989,875 4.94 % 8.7 Commercial mortgage-backed securities 516,882 2.70 4.2 Collateralized mortgage obligations 788,885 5.15 2.1 Held to maturity Residential mortgage-backed securities $ 537,856 3.13 % 9.2 Commercial mortgage-backed securities 857,713 1.52 5.7 67 The following table presents the contractual maturities of fixed rate loans and loan types subject to changes in interest rates as of December 31, 2024: One Year or Less After One Through Five Years After Five Through Fifteen Years After 15 Years Total (dollars in thousands) Commercial and industrial: Adjustable and floating rate $ 1,160,844 $ 2,177,388 $ 320,385 $ 5,586 $ 3,664,203 Fixed rate 387,190 509,344 44,001 851 941,386 Total commercial and industrial 1,548,034 2,686,732 364,386 6,437 4,605,589 Real estate - mortgage (1) : Adjustable and floating rate 2,591,921 5,341,646 2,615,788 277,102 10,826,457 Fixed rate 1,288,523 2,412,596 1,866,083 718,458 6,285,660 Total real estate - mortgage (1) 3,880,444 7,754,242 4,481,871 995,560 17,112,117 Real estate - construction: Adjustable and floating rate 480,495 500,384 69,595 1,692 1,052,166 Fixed rate 254,477 84,382 3,874 — 342,733 Total real estate - construction 734,972 584,766 73,469 1,692 1,394,899 Consumer, leases and other: Adjustable and floating rate 12,599 57,746 166 — 70,511 Fixed rate 265,592 505,255 123,130 3,430 897,407 Total consumer, leases and other 278,191 563,001 123,296 3,430 967,918 Unearned income — (35,604) — — (35,604) Total $ 6,441,641 $ 11,553,137 $ 5,043,022 $ 1,007,119 $ 24,044,919 (1) Includes commercial and residential mortgages and home equity loans.

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