BANCFIRST CORP /OK/ (BANF)

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

The following discussion and analysis of our financial condition as of March 31, 2026 and December 31, 2025 and results of operations for the three months ended March 31, 2026 should be read in conjunction with our consolidated financial statements and notes to the consolidated financial statements for the year ended December 31, 2025 and the other information included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. Certain risks, uncertainties and other factors, including those set forth under "Risk Factors" in Part I, Item 1A of the 2025 Form 10-K, and "Item 1A, Risk Factors" in this Quarterly Report on Form 10-Q, may cause actual results to differ materially from the results discussed in the forward-looking statements appearing in this discussion and analysis.

FORWARD LOOKING STATEMENTS

The Company may make forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 with respect to earnings, credit quality, corporate objectives, interest rates and other financial and business matters. Forward-looking statements include estimates and give management’s current expectations or forecasts of future events. The Company cautions readers that these forward-looking statements are subject to numerous assumptions, risks and uncertainties, including economic conditions; the performance of financial markets and interest rates; legislative and regulatory actions and reforms; competition; as well as other factors, all of which change over time. Examples of forward-looking statements include, but are not limited to: (i) projections of revenues, expenses, income or loss, earnings or loss per share, the payment or nonpayment of dividends, capital structure and other financial items; (ii) statements of plans, objectives and expectations, including those relating to products or services; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such statements. Words such as “believes”, “anticipates”, “expects”, “intends”, “targeted”, “continue”, “remain”, “will”, “should”, “may” and other similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.

Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those in such statements. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to:

•
The effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard setters.

•
Changes in fiscal, monetary or regulatory policy may have adverse consequences including impacts to the labor market, tariffs and inflation which may impact our financial performance.

•
Changes in the regulatory environment for the banking industry, including rule-making, supervision, examination and enforcement.

•
The increased time, effort and staffing needs related to ongoing and/or changed regulations from regulatory bodies could negatively impact noninterest expense.

•
Local, regional, national and international economic conditions, including the effect of a government shutdown, and the impact they may have on the Company and its customers.

•
Inflation, including wage inflation, energy prices, securities markets and monetary fluctuations.

•
Changes in oil and gas commodity prices and the potential impact to the related loan portfolio as well as the overall impact to the regional economic environment.

•
Changes in interest rates.

•
Adverse developments in the banking industry that could impact customer confidence.

•
Further shift in deposit mix from noninterest-bearing deposits to interest-bearing deposits could negatively impact net interest margin.

•
Changes in the financial performance and/or condition of the Company’s borrowers.

•
Changes in consumer spending, borrowing and savings habits.

•
Changes in the mix of loan sectors and types or the level of non-performing assets and charge-offs.

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•
Deterioration in the market for commercial office property could have an adverse effect on the value of the Company's other real estate owned as well as commercial office collateral for the Company's commercial real estate loans.

•
Impairment of the Company’s goodwill or other intangible assets.

•
Technological changes, artificial intelligence, fintech competition and disruption to the traditional banking systems, including emerging regulation around stablecoins, tokenized deposits, blockchain technology in payment networks and market acceptance of digital assets.

•
Cyber threats including system failures, interruptions or security breaches, which could include fraud or ransomware, impacting the Company, third-party vendors and/or customers.

•
The Company’s success at managing the risks involved in the foregoing items.

Actual results may differ materially from forward-looking statements.

SUMMARY

The Company’s net income for the first quarter of 2026 was $63.0 million, compared to $56.1 million for the first quarter of 2025. Diluted net income per common share was $1.85 and $1.66 for the first quarter of 2026 and 2025, respectively. The Company’s net interest income for the first quarter of 2026 increased to $127.6 million from $115.9 million for the first quarter of 2025. Higher loan volume along with general growth in earning assets were the primary drivers of the change in net interest income. Net interest margin was 3.74% for the first quarter of 2026 compared to 3.70% for the first quarter of 2025. The Company recorded a provision for credit losses of $2.1 million in the first quarter of 2026 compared to $1.6 million for the first quarter of 2025.

Noninterest income for the quarter totaled $51.4 million compared to $49.0 million last year. Trust revenue, services charges on deposits, treasury income, and securities transaction each increased compared to first quarter of 2025 partially offset by a decrease in insurance commissions.

Noninterest expense grew to $96.8 million for the quarter-ended March 31, 2026 compared to $92.2 million in the same quarter in 2025. The increase in noninterest expense was primarily attributable to the growth in salaries and employee benefits of $4.3 million. The total salaries and benefits expenses recorded of $58.9 million for the period ended March 31, 2026 is after a favorable adjustment to the funded employee benefit trust of $1.8 million. Total noninterest expense for the first quarter of 2026 also reflects conversion expenses related to ABOK. For the first quarter of 2025 the Company recorded a $4.4 million expense related to the disposition of certain equity investments no longer permissible under the Volcker rule, no such equivalent expense was recorded in 2026.

At March 31, 2026, the Company’s total assets were $15.1 billion, an increase of $277.6 million from December 31, 2025. Loans grew $51.4 million from December 31, 2025, totaling $8.6 billion at March 31, 2026. Deposits totaled $12.9 billion, an increase of $230.7 million from year-end 2025. Sweep accounts totaled $5.1 billion at March 31, 2026, up $160.2 million from December 31, 2025. The Company’s total stockholders’ equity was $1.9 billion, an increase of $47.8 million over December 31, 2025.

FUTURE APPLICATION OF ACCOUNTING STANDARDS

See Note (1) of the Notes to the Consolidated Financial Statements for disclosures regarding recently issued accounting pronouncements since December 31, 2025, the date of its most recent annual report to stockholders.

SEGMENT INFORMATION

See Note (12) of the Notes to the Consolidated Financial Statements for disclosures regarding business segments.

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RESULTS OF OPERATIONS

Average Balances, Income, Expenses and Rates

The following table presents certain information related to the Company's consolidated average balance sheet, average yields on assets and average costs of liabilities. Such yields are derived by dividing income or expense by the average balance of the corresponding assets or liabilities. For these computations: (i) average balances are derived from daily averages, (ii) information is shown on a taxable-equivalent basis assuming a 21% tax rate, and (iii) nonaccrual loans are included in the average loan balances and any interest on such nonaccrual loans is recognized on a cash basis. Loan fees included in interest income were $5.1 million for the three months ended March 31, 2026 compared to $5.0 million for the three months ended March 31, 2025.

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[Excerpt truncated for page length; source filing is linked above.]

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis presents factors that the Company believes are relevant to an assessment and understanding of the Company’s financial position and results of operations for the three years ended December 31, 2025. This discussion and analysis should be read in conjunction with the consolidated financial statements and notes thereto and the selected consolidated financial data included herein.

FORWARD-LOOKING STATEMENTS

The Company may make forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 with respect to earnings, credit quality, corporate objectives, interest rates and other financial and business matters. Forward-looking statements include estimates and give management’s current expectations or forecasts of future events. The Company cautions readers that these forward-looking statements are subject to numerous assumptions, risks and uncertainties, including economic conditions; the performance of financial markets and interest rates; legislative and regulatory actions and reforms; competition; as well as other factors, all of which change over time. Examples of forward-looking statements include, but are not limited to: (i) projections of revenues, expenses, income or loss, earnings or loss per share, the payment or nonpayment of dividends, capital structure and other financial items; (ii) statements of plans, objectives and expectations, including those relating to products or services; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such statements. Words such as “believes”, “anticipates”, “expects”, “intends”, “targeted”, “continue”, “remain”, “will”, “should”, “may” and other similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.

Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those in such statements. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to:

•
The effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard setters.

•
Changes in fiscal, monetary or regulatory policy may have adverse consequences including impacts to the labor market, tariffs and inflation which may impact our financial performance.

•
Changes in the regulatory environment for the banking industry, including rule-making, supervision, examination and enforcement.

•
The increased time, effort and staffing needs related to ongoing and/or changed regulations from regulatory bodies could negatively impact noninterest expense.

•
Local, regional, national and international economic conditions, including the effect of a government shutdown, and the impact they may have on the Company and its customers.

•
Inflation, including wage inflation, energy prices, securities markets and monetary fluctuations.

•
Changes in oil and gas commodity prices and the potential impact to the related loan portfolio as well as the overall impact to the regional economic environment.

•
Changes in interest rates.

•
Potential impacts of adverse developments in the banking industry that could impact customer confidence.

•
Further shift in deposit mix from noninterest-bearing deposits to interest-bearing deposits could negatively impact net interest margin.

•
Changes in the financial performance and/or condition of the Company’s borrowers, including the impact of higher interest rates.

•
Changes in consumer spending, borrowing and savings habits.

•
Changes in the mix of loan sectors and types or the level of non-performing assets and charge-offs.

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•
Deterioration in the market for commercial office property could have an adverse effect on the value of the Company's other real estate owned as well as commercial office collateral for the Company's commercial real estate loans.

•
Impairment of the Company’s goodwill or other intangible assets.

•
Technological changes, fintech competition and disruption to the traditional banking systems, including emerging regulation around stablecoins, blockchain technology in payment networks and market acceptance of digital assets.

•
Cyber threats.

•
The Company’s success at managing the risks involved in the foregoing items.

Actual results may differ materially from forward-looking statements.

SUMMARY

The Company’s net income for 2025 was $240.6 million, or $7.11 per diluted share, compared to $216.4 million, or $6.44 per diluted share for 2024.

In 2025, net interest income increased to $490.5 million, compared to $446.9 million in 2024. Higher loan volume and growth in other earning assets were the primary drivers of the change in net interest income. The Company’s net interest margin increased to 3.74% for 2025 compared to 3.73% for 2024.

The Company recorded a provision for credit losses of $5.7 million in 2025 compared to $9.0 million in 2024. The Company's provision for credit losses decreased in 2025 primarily due to the lower loss rates experienced in more recent periods and the impact on the vintage loss analysis.

Noninterest income totaled $200.1 million in 2025 compared to $184.6 million in 2024. The increase in noninterest income was partially due to a gain on the sale of Visa B-1 stock of $4.5 million. In addition, trust revenue, treasury income, sweep fees and insurance commissions each increased during the year.

Noninterest expense was $379.8 million in 2025 compared to $347.2 million in 2024. Higher noninterest expenses in 2025 were primarily related to growth in salaries and employee benefits of $14.0 million related to annual merit increases and new hires. Also contributing to noninterest expense was an increase in net expense from other real estate owned of $7.4 million, which largely consisted of an increase in write-downs of other real estate of $4.1 million, other real estate expense of $1.8 million and a decrease in loss on sales of $1.5 million. Data processing expense increased $1.1 million in 2025 compared to 2024.

The Company’s assets at year-end 2025 totaled $14.8 billion, an increase of $1.3 billion from December 31, 2024. Loans grew $511.5 million from December 31, 2024, totaling $8.5 billion at December 31, 2025. Deposits totaled $12.7 billion at December 31, 2025 an increase of $951.8 million from December 31, 2024. Off-balance-sheet sweep accounts totaled $4.9 billion at December 31, 2025, down $262.6 million from December 31, 2024. The Company’s total stockholders’ equity totaled $1.9 billion at December 31, 2025.

Asset quality was strong through the year. Nonaccrual loans of $61.1 million representing 0.72% of total loans at December 31, 2025 relatively unchanged from $58.0 million or 0.72% of total loans at December 31, 2024. The allowance for credit losses to total loans was 1.22% at December 31, 2025, down slightly from 1.24% at December 31, 2024. Net charge-offs were $8.5 million for the year, compared to $6.3 million for the year ended December 31, 2024.

See Note (2) of the Notes to Consolidated Financial Statements for disclosure regarding the Company’s recent developments, including mergers and acquisitions.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The Company’s significant accounting policies are described in Note (1) to the consolidated financial statements. The preparation of financial statements in conformity with accounting principles generally accepted in the United States inherently involves the use of estimates and assumptions, which affect the amounts reported in the financial statements and the related disclosures. These estimates

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relate principally to the allowance for credit losses, income taxes, intangible assets and the fair value of financial instruments. Such estimates and assumptions may change over time and actual amounts realized may differ from those reported. The following is a summary of the accounting policies and estimates that management believes are the most critical.

Allowance for Credit losses

The Company determines its provision for credit losses and allowance for credit losses using the current expected credit loss methodology that is referred to as the current expected credit loss ("CECL") model. The allowance for credit losses is measured on a collective (pool) basis when similar risk characteristics exist.

The allowance for credit losses is increased by provisions charged to operating expense and is reduced by net loan charge-offs. The amount of the allowance for credit losses is measured using relevant information about past events, including historical credit loss experience on financial assets with similar risk characteristics, current conditions and reasonable and supportable forecasts that affect the collectability of the remaining cash flows over the contractual term of the financial assets.

To estimate expected losses using historical loss information, the Company elected to utilize a methodology known as vintage loss analysis. Vintage loss analysis measures impairment based on the age of the accounts and the historical performance of assets with similar risk characteristics. Vintage loss analysis determines expected losses by allowing the Company to calculate the cumulative loss rates of a given loan pool and, in so doing, determine the loan pool’s lifetime expected loss experience relative to the appropriate type of financial assets that share similar risk characteristics. Vintage loss analysis uses different “vintages” analyzed by year of origination through the weighted average maturity of each loan pool. The key quantitative inputs used in the Company’s estimate of the allowance for credit losses include 1) all available loan data tracked by year of origination, 2) total charge-offs for each specific loan pool recorded since year of origination, 3) recovery rate calculated by the average recovery over the previous seven years across all loan pools and 4) a weighting factor biased to more recent loss experience. The quantitative expected credit loss is calculated by dividing each year’s net charge-offs by the original balance. The respective vintage’s original balance remains the denominator in each annual calculation, as it references the specific vintage’s initial balance. The loss experience of this original balance is tracked annually and summed over the life of the loan for each separate loan pool, leaving a cumulative life of credit loss rate based on historic averages weighted towards more recent loss experience. These key quantitative inputs change from period to period as new loans are originated and charge-offs and recoveries are recognized. The recovery rate is revised on an annual basis, taking into consideration the most recent seven years. The weighting factor percentages remain static; however, the most recent year receives the highest weighting percentage.

The Senior Loan Committee (“the SLC”) approves qualitative adjustments for each loan pool. In approving the qualitative adjustments, they consider several factors, including external economic information, peer bank comparisons and experience with the loan portfolio, among others. The SLC also considers other current conditions adjustments and reasonable and supportable forecasts derived from third party information, primarily Moody’s Analytics economic scenarios. To determine the appropriateness of the economic scenarios, the Company uses judgment and statistical analysis which correlates charge-off history to the economic scenarios. The Company then forecasts future loss expectations based on the selected economic scenarios over the next 12 months, which is driven by management’s judgment of a reasonable and supportable forecast period, to arrive at an estimated qualitative adjustment attributable to economic forecasts. For periods beyond which the Company is able to make or obtain reasonable and supportable forecasts of expected credit losses, the Company reverts to historical loss information.

In some cases, management may determine a loan to be collateral dependent. A loan is considered collateral-dependent when the borrower is experiencing financial difficulty based on the Company's assessment as of the reporting date and the repayment is expected to be provided substantially through the operation or sale of the collateral. For collateral dependent loans, the standard allows institutions to use, as a practical expedient, the fair value of the collateral to measure current expected credit losses on collateral-dependent financial assets. This amount is included in the allowance for credit losses.

Each quarter the SLC reviews the aggregate allowance. In addition, annually or more frequently as needed, the SLC evaluates the qualitative adjustments used in the allowance based on the information described above. To facilitate the SLC’s evaluation, the Asset Quality Department performs periodic reviews of business units and reports on the adequacy of management’s identification of collateral-dependent and adversely classified loans and their adherence to loan policies and procedures.

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The process of evaluating the appropriateness of the allowance for credit losses necessarily involves the exercise of judgment and consideration of numerous subjective factors and, accordingly, there can be no assurance that the estimate of expected losses will not change in light of future developments and economic conditions. Changes in assumptions and conditions could result in a materially different amount for the allowance for credit losses.

Income Taxes

The Company files a consolidated income tax return. Deferred taxes are recognized under the balance sheet method based upon the future tax consequences of temporary differences between the carrying amounts and tax basis of assets and liabilities, using the tax rates expected to apply to taxable income in the periods when the related temporary differences are expected to be realized.

The amount of accrued current and deferred income taxes is based on estimates of taxes due or receivable from taxing authorities either currently or in the future. Changes in these accruals are reported as income tax expense or benefits, and involve estimates of the various components included in determining taxable income, tax credits, other taxes and temporary differences. Changes periodically occur in the estimates due to changes in tax rates, tax laws and regulations and implementation of new tax planning strategies. The process of determining the accruals for income taxes necessarily involves the exercise of considerable judgment and consideration of numerous subjective factors.

Management performs an analysis of the Company’s tax positions annually and believes it is more likely than not that all of its tax positions will be utilized in future years.

Intangible Assets and Goodwill

Core deposit intangibles are amortized on a straight-line basis over the estimated useful lives of seven to ten years and customer relationship intangibles are amortized on a straight-line basis over the estimated useful life of three to eighteen years. Goodwill is not amortized, but is evaluated at a reporting unit level at least annually for impairment or more frequently if other indicators of impairment are present. At least annually in the fourth quarter, intangible assets, are evaluated for possible impairment. Impairment losses are measured by comparing the fair values of the intangible assets with their recorded amounts. Any impairment losses are reported in the consolidated statements of comprehensive income.

The evaluation of remaining core deposit intangibles for possible impairment involves reassessing the useful lives and the recoverability of the intangible assets. The evaluation of the useful lives is performed by reviewing the levels of core deposits of the respective branches acquired. The actual life of a core deposit base may be longer than originally estimated due to more successful retention of customers, or may be shorter due to more rapid runoff. Amortization of core deposit intangibles would be adjusted, if necessary, to amortize the remaining net book values over the remaining lives of the core deposits. The evaluation for recoverability is only performed if events or changes in circumstances indicate that the carrying amount of the intangibles may not be recoverable.

The evaluation of goodwill for possible impairment is performed by comparing the fair values of the related reporting units with their carrying amounts including goodwill. The fair values of the related reporting units are estimated using market data for prices of recent acquisitions of banks and branches.

The evaluation of intangible assets and goodwill for the year ended December 31, 2025 and 2024 resulted in no impairments.

Fair Value of Financial Instruments

Debt securities that are being held for indefinite periods of time, or that may be sold as part of the Company’s asset/liability management strategy, to provide liquidity or for other reasons, are classified as available for sale and are stated at estimated fair value. Unrealized gains or losses on debt securities available for sale are reported as a component of stockholders’ equity, net of income tax.

The Company reviews its portfolio of debt securities in an unrealized loss position at least quarterly. The Company first assesses whether it intends to sell, or it is more-likely-than-not that it will be required to sell, the securities before recovery of the amortized cost basis. If either of these criteria is met, the security's amortized cost basis is written down to fair value as a current period expense. If either of the above criteria is not met, the Company evaluates whether the decline in fair value is the result of credit losses or other factors. In making this assessment, the Company considers, among other things, the performance of any underlying collateral and adverse conditions specifically related to the security. At December 31, 2025 97.2% of the available for sale debt securities held by the Company were issued by the U.S. Treasury, or U.S. government-sponsored entities and agencies. The Company does not consider the unrealized position of these securities to be the result of credit factors, because the decline in fair value is attributable to changes in

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interest rates and illiquidity, and not credit quality, and the Company does not have the intent to sell these securities and it is unlikely that it will be required to sell the securities before their anticipated recovery. Therefore, the Company has not recorded an allowance for credit losses against its debt securities portfolio, as the credit risk is not material.

The estimates of fair values of debt securities and other financial instruments are based on a variety of factors. In some cases, fair values represent quoted market prices for identical or comparable instruments. In other cases, fair values have been estimated based on assumptions concerning the amount and timing of estimated future cash flows and assumed discount rates reflecting varying degrees of risk. Accordingly, the fair values may not represent actual values of the financial instruments that could have been realized as of year-end or that will be realized in the future.

Future Application of Accounting Standards

See Note (1) of the Notes to Consolidated Financial Statements for a discussion of recently issued accounting pronouncements and their expected impact on the Company’s consolidated financial statements.

Segment Information

See Note (23) of the Notes to Consolidated Financial Statements for disclosure regarding the Company’s operating business segments.

RESULTS OF OPERATIONS

The following discussion and analysis presents the more significant factors that affected the Company's financial condition as of December 31, 2025 and 2024 and results of operations for each of the years then ended. Refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K filed with the SEC on February 28, 2025 (the “2024 Form 10-K”) for information about results of operations for 2024 compared with 2023, which the Company incorporates by reference.

This discussion and analysis should be read in conjunction with the Company's consolidated financial statements, notes thereto and other financial information appearing elsewhere in this report. From time to time, the Company has engaged in acquisitions. None of these acquisitions had a significant impact on the Company's consolidated financial statements. The Company accounts for acquisitions using the acquisition method, and as such, the results of operations of acquired companies are included from the date of acquisition forward.

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Average Balances, Income, Expenses and Rates

The following tables present certain information related to the Company's consolidated average balance sheet, average yields on assets and average costs of liabilities. Such yields are derived by dividing income or expense by the average balance of the corresponding assets or liabilities. For these computations: (i) average balances are derived from daily averages, (ii) information is shown on a taxable-equivalent basis assuming a 21% tax rate and (iii) nonaccrual loans are included in the average loan balances and any interest on such nonaccrual loans is recognized on a cash basis. Loan fees included in interest income were $20.9 million for the year ended December 31, 2025 compared to $20.8 million for the year ended December 31, 2024 and $21.9 million for the year ended December 31, 2023.

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The following table depicts, for the periods indicated, selected income statement data and other selected data:

Net Interest Income

Net interest income, which is the Company’s principal source of operating revenue, increased $43.6 million in 2025. The primary driver of the increase in net interest income was higher loan volume and growth in other earning assets.

Changes in the volume of earning assets and interest-bearing liabilities and changes in interest rates, determine the changes in net interest income. The following volume/rate analysis summarizes the relative contribution of each of these components to the changes in net interest income in 2025 and 2024. See “Maturity and Rate Sensitivity of Loans” for additional discussion.

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VOLUME/RATE ANALYSIS

Taxable Equivalent Basis

Provision for Credit Losses

The Company's provision for credit losses decreased in 2025 primarily due to the lower loss rates observed in more recent periods and the impact on the vintage loss analysis. The Company establishes an allowance as an estimate of the current expected credit losses in the loan portfolio at the balance sheet date. Management believes the allowance for credit losses is appropriate based upon management’s best estimate of expected losses within the existing loan portfolio. Should any of the factors considered by management in evaluating the appropriate level of the allowance for credit losses change, the Company’s estimate of expected credit losses could also change which could affect the amount of future provisions for credit losses.

Net loan charge-offs were $8.5 million for 2025 compared to $6.3 million for 2024. The net charge-offs equated to 0.10% and 0.08% of average loans for 2025 and 2024, respectively. The rate of net charge-offs to average total loans continues to be at a low level. A more detailed discussion of the allowance for credit losses is provided under “Loans.”

Noninterest Income

Total noninterest income increased by $15.6 million, or 8.4% for 2025 compared to 2024. The increase in noninterest income was partially due to a gain on the sale of Visa B-1 stock of $4.5 million. Other drivers of the increase in noninterest income include increased income from sweep fees of $3.5 million along with increases in trust revenue of $1.3 million, treasury income of $1.4 million, insurance commissions of $1.5 million, service charges on deposits of $1.5 million and gain on sale of other assets of $1.0 million.

The Company’s operating noninterest income has generally increased over time due to enhanced product lines, acquisitions and internal deposit account growth.

The Company earned $3.2 million on the sale of loans in 2025 compared to $2.7 million in 2024.

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Noninterest income included NSF and overdraft fees totaling $31.6 million and $31.1 million in 2025 and 2024, respectively. This represents 15.8% and 16.8% of the Company’s noninterest income for the years 2025 and 2024, respectively. In addition, the Company had debit card usage and interchange fees totaling $27.2 million and $26.8 million for the years 2025 and 2024, respectively. This represents 13.6% and 14.5% of the Company’s noninterest income for the years 2025 and 2024, respectively.

Noninterest Expense

Total noninterest expense increased by $32.7 million, or 9.4% for 2025 compared to 2024. Higher noninterest expenses in 2025 were primarily related to growth in salaries and employee benefits of $14.0 million related to annual merit increases and new hires. In addition, net expense from other real estate owned increased $7.4 million, which largely consisted of an increase in write-downs of other real estate of $4.1 million, other real estate expense of $1.8 million and was partially offset by a decrease in loss on sales of $1.5 million. Data processing expense increased $1.1 million in 2025 compared to 2024. Occupancy expense increased $3.0 million, due largely to repairs and maintenance. In addition, included in other, the Company recorded an expense related to the disposition of certain equity investments no longer permissible under the Volcker Rule, which prohibits banks with more than $10 billion in assets from holding certain private equity investments.

Noninterest expense included deposit insurance expense, which totaled $6.8 million for the year ended December 31, 2025, compared to $6.4 million for the year ended December 31, 2024.

Income Taxes

Income tax expense totaled $64.5 million in 2025, compared to $58.9 million in 2024. The effective tax rates for 2025 and 2024 were 21.1% and 21.4% respectively.

The primary reasons for the difference between the Company’s effective tax rate and the federal statutory rate were tax-exempt income, nondeductible amortization, federal and state tax credits and state tax expense.

Certain financial information is prepared on a taxable equivalent basis to facilitate analysis of yields and changes in components of earnings. Average balance sheets, comprehensive income statements and other financial statistics are also presented on a taxable equivalent basis.

Impact of Inflation

The impact of inflation on financial institutions differs significantly from that of industrial or commercial companies. The assets of financial institutions are predominantly monetary, as opposed to fixed or nonmonetary assets such as premises, equipment and inventory. As a result, there is little exposure to inflated earnings by understated depreciation charges or significantly understated current values of assets. Although inflation can have an indirect effect by leading to higher interest rates, financial institutions are in a position to monitor the effects on interest costs and yields and respond to inflationary trends through management of interest rate sensitivity. Inflation can also have an impact on noninterest expenses such as salaries and employee benefits, occupancy, services and other costs.

Impact of Deflation

In a period of deflation, it would be reasonable to expect widely decreasing prices for real assets. In such an economic environment, assets of businesses and individuals, such as real estate, commodities or inventory, could decline. The inability of customers to repay or refinance their loans could result in credit losses incurred by the Company far in excess of historical experience due to deflated collateral values.

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FINANCIAL POSITION

Cash, Federal Funds Sold and Interest-Bearing Deposits with Banks

Cash consists of cash and cash items on hand, noninterest-bearing deposits and amounts due from other banks, reserves deposited with the Federal Reserve Bank, and interest-bearing deposits with other banks. Federal funds sold consist of overnight investments of excess funds with other financial institutions. The Company has continued to maintain the majority of its excess funds with the Federal Reserve Bank. The Federal Reserve Bank pays interest on these funds based upon the lowest target rate for the maintenance period, which decreased during the last four months of 2025 from 4.40% to 3.65%. The rate decreased from 5.40% to 4.40% during the last four months of 2024.

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The amount of cash, federal funds sold and interest-bearing deposits with the Federal Reserve Bank carried by the Company is a function of the availability of funds presented to other institutions for clearing and the Company’s liquidity and interest rate sensitivity management. Balances of these items can fluctuate widely based on these various factors. The aggregate of cash and due from banks, federal funds sold and interest-bearing deposits with banks increased by $941.6 million, or 26.5%, to $4.5 billion, from December 31, 2024 to December 31, 2025. The increase was related to an increase of interest-bearing deposits in addition to maturing securities.

Securities

For the year ended December 31, 2025, total debt securities decreased $286.8 million. Debt securities available for sale represented 99.9% of the total debt securities portfolio at both December 31, 2025 and December 31, 2024. Debt securities available for sale had a net unrealized loss, before taxes, of $10.8 million at December 31, 2025, compared to $43.1 million at December 31, 2024. These unrealized losses, net of income taxes, of $8.3 million at December 31, 2025 and $32.9 million at December 31, 2024 are included in the Company’s stockholders’ equity as accumulated other comprehensive loss. The Company did not recognize a gain or loss on debt securities during the years ended December 31, 2025 or 2024. The Company purchased a total of $371.3 million of debt securities in 2025 compared to $375.4 million of debt securities in 2024. In addition, the Company had maturities and paydowns of debt securities totaling $709.2 million in 2025 and $742.3 million in 2024.

The Company does not engage in securities trading activities. Any sales of debt securities are for the purpose of executing the Company’s asset/liability management strategy, eliminating a perceived credit risk in a specific security, or providing liquidity. Debt securities that are being held for indefinite periods of time, or that may be sold as part of the Company’s asset/liability management strategy, to provide liquidity, or for other reasons, are classified as available for sale and are stated at estimated fair value. Unrealized gains or losses on debt securities available for sale are reported as a component of stockholders’ equity, net of income tax. Debt securities for which the Company has the intent and ability to hold to maturity are classified as held for investment and are stated at cost, adjusted for amortization of premiums and accretion of discounts computed under the interest method.

Management has the ability and intent to hold the debt securities classified as held for investment until they mature, at which time the Company will receive full value for the securities. Furthermore, the Company also has the ability and intent to hold the debt securities classified as available for sale for a period of time sufficient for a recovery of cost. As of December 31, 2025, the Company had net unrealized losses largely due to increases in market interest rates over the yields available at the time the underlying securities were purchased. The fair value of those securities having unrealized losses is expected to recover as the securities approach their maturity date or repricing date, or if market yields for similar investments decrease. Furthermore, as of December 31, 2025, management had no intent or requirement to sell before the recovery of the unrealized loss.

See Note (4) of the Notes to Consolidated Financial Statements for disclosures regarding the Company’s Securities.

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WEIGHTED AVERAGE YIELD OF DEBT SECURITIES

The following table summarizes the maturity distribution schedule with corresponding weighted average taxable equivalent yields of the debt securities portfolio at December 31, 2025. The following table presents securities at their expected maturities, which may differ from contractual maturities. The Company manages its debt securities portfolio for liquidity, as a tool to execute its asset/liability management strategy, and for pledging requirements for public funds. For the interest rate sensitivity of debt securities see the table in item 7A.

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Loans

The Company has historically generated loan growth from both internal originations and bank acquisitions. Total loans held for investment increased $507.7 million, or 6.3% in 2025, as a result of internal loan growth and its acquisition of ABOK. The acquisition of ABOK added $243.1 million of the increase in loans held for investment. In addition, of the total increase in loans, commercial real estate loans made up the largest increase with $242.0 million, or 47.7%, residential real estate loans increased $204.8 million, or 40.3% and consumer non-real estate loans increased $54.8 million, or 10.8%. Construction and development loans decreased $99.4 million, or 19.6% in 2025. The preponderance of internal loan growth was from the Company's Oklahoma subsidiary BancFirst.

Composition

The Company’s loan portfolio was diversified among various types of commercial and individual borrowers. Commercial loans were comprised principally of loans to companies in real estate, light manufacturing, retail and service industries. Consumer non-real estate loans were comprised primarily of loans to individuals for automobiles.

LOANS HELD FOR INVESTMENT BY CATEGORY

See Note (1) and Note (5) of the Notes to Consolidated Financial Statements for additional disclosures regarding the Company’s loans.

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LOANS BY MATURITY AND INTEREST RATE SENSITIVITY

The information relating to the maturity and interest rate sensitivity of loans is based upon contractual maturities and original loan terms. In the ordinary course of business, loans maturing within one year may be renewed, in whole or in part, at interest rates prevailing at the date of renewal.

The following table presents the maturity distribution of loans held for investment at December 31, 2025. Many of the loans with maturities of one year or less are renewed at existing or similar terms after scheduled principal reductions. Also, approximately 64% of loans had adjustable interest rates at December 31, 2025.

The interest rate composition of loans with a maturity date over one year are presented below based on contractual terms.

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NONPERFORMING ASSETS

The following table summarizes nonperforming assets.

Nonaccrual Loans

Nonaccrual loans increased $3.1 million during 2025. Although nonaccrual loans increased during 2025, they represent only 0.72% of loans at December 31, 2025. Nonaccrual loans negatively impact the Company’s net interest margin. A loan is placed on nonaccrual status when, in the opinion of management, the future collectability of both interest and principal is in serious doubt. Interest income is not recognized until the principal balance is fully collected. However, if the full collection of the remaining principal balance is not in doubt, interest income is recognized on certain of these loans on a cash basis. Had nonaccrual loans performed in accordance with their original contractual terms, the Company would have recognized additional interest income of $4.9 million for 2025 and $3.5 million for 2024. Only a small amount of this interest is expected to be ultimately collected.

The classification of a loan as nonaccrual does not necessarily indicate that loan principal and interest will ultimately be uncollectible; although, in an economic downturn, the Company’s experience has been that the level of collections decline. The above normal risk associated with nonaccrual loans has been considered in the determination of the allowance for credit losses. The level of nonaccrual loans and credit losses could rise over time as a result of adverse economic conditions. At December 31, 2025, the allowance for credit losses as a percentage of nonaccrual loans was 170.6%, compared to 171.6%, at the end of 2024.

Modified Loans

The Company evaluates, based on the accounting for loan modifications, whether the modification represents a new loan or a continuation of an existing loan when a borrower is experiencing financial difficulty. The current and future financial effects of the recorded balance of loans considered to be modified during the period were not considered to be material. The recorded balance of loans modified during the year ended December 31, 2025 was approximately $6.4 million. The recorded balance of loans modified during the year ended December 31, 2024 was approximately $14.8 million.

Other Real Estate Owned and Repossessed Assets

Other real estate owned ("OREO") and repossessed assets increased $15.5 million in 2025. OREO consists of properties acquired through foreclosure proceedings or acceptance of a deed in lieu of foreclosure and premises held for sale. These properties are carried at the lower of the book values of the related loans or fair values based upon appraisals of the properties, less estimated costs to sell. Write-downs arising at the time of reclassification of such properties from loans to OREO are charged directly to the allowance for credit losses. Any losses on bank premises designated to be sold are charged to operating expense at the time of transfer from premises to OREO. Decreases in values of properties subsequent to their classification as OREO are charged to operating expense. The Company's write-downs in OREO totaled $8.2 million for 2025 and $4.0 million for 2024.

During the twelve months ended December 31, 2025, the Company foreclosed on a construction and development real estate loan and recorded $15.6 million in OREO, which was the primary reason for the increase in OREO. In addition, as of both December 31, 2025 and December 31, 2024, OREO included a commercial real estate property recorded at approximately $24.7 million and $28.1 million, respectively. The decrease for this commercial real estate property was due to write downs during the year ended December 31, 2025.

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Rental income for OREO properties is included in other noninterest income on the consolidated statements of comprehensive income. Operating expense for OREO properties is included in net expense from OREO in other noninterest expense on the consolidated statements of comprehensive income.

The Company's total rental income and operating expenses from OREO are presented in the following table:

Allowance for Credit Losses/Fair Value Adjustments on Acquired Loans

The Company determines its provision for credit losses and allowance for credit losses using the expected loss methodology that is referred to as the CECL model. The allowance for credit losses is measured on a collective (pool) basis when similar risk characteristics exist. At December 31, 2025, the allowance for credit losses to total loans stood at 1.22% of total loans, compared to 1.24% at December 31, 2024.

The overall credit quality of the Company’s loan portfolio has remained strong. Net charge-offs were $8.5 million and $6.3 million for the years ended 2025 and 2024, respectively. The amount of net loan charge-offs is relatively low, equating to 0.10% and 0.08% of average total loans for the years ended December 31, 2025 and 2024, respectively. If unforeseen adverse changes occur in the national or local economy, or in the credit markets, it would be reasonable to expect that the allowance for credit losses would increase in future periods.

ANALYSIS OF ALLOWANCE FOR CREDIT LOSSES

The following table is a break-out of the allowance for credit losses:

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The following table is a break-out of net charge-offs/(recoveries) and the break-out of the percent of average loans in each category:

Fair Value Adjustments on Acquired Loans

The fair value adjustment on acquired loans can consist of a credit component and a rate component to adjust for estimated credit exposures in the acquired loans. The credit component of the adjustment was a $841,000 discount at December 31, 2025 and a $1.1 million discount at December 31, 2024. The rate component was $417,000 at December 31, 2025 and $472,000 at December 31, 2024. These fair value adjustments will be accreted to income over the remaining life of the loans. The acquired loans outstanding were $504.0 million and $262.2 million, at December 31, 2025 and 2024, respectively.

Intangible Assets, Goodwill and Other Assets

Identifiable intangible assets and goodwill totaled $204.1 million and $195.4 million at December 31, 2025 and December 31, 2024. On November 17, 2025, the Company acquired American Bank of Oklahoma and recorded a core deposit intangible of approximately $11.6 million and goodwill of approximately $476,000. See Note (7) of the Notes to Consolidated Financial Statements for disclosure regarding the Company’s intangible assets and goodwill.

See Note (2) of the Notes to Consolidated Financial Statements for disclosure regarding the Company’s recent developments, including mergers and acquisitions.

Other assets include the cash surrender value of key-man life insurance policies totaling $94.2 million at December 31, 2025 and $84.4 million at December 31, 2024.

Derivative financial instruments consisting of oil and gas swaps and option contracts are included in other assets and totaled $21.2 million at December 31, 2025 and $10.5 million at December 31, 2024. They require a daily margin to be posted, which fluctuates with oil and gas prices and customer activity. The Company had a margin liability included in other liabilities in the amount of $7.4 million at December 31, 2025. The Company had a margin asset included in other assets in the amount of $463,000 at December 31, 2024. See Note (22) of the Notes to Consolidated Financial Statements for a complete discussion of the Company’s derivative financial instruments.

Equity securities are reported in other assets on the balance sheet. The Company invests in equity securities without readily determinable fair values. The realized and unrealized gains and losses are reported as securities transactions in the noninterest income section of the consolidated statements of comprehensive income. The balance of equity securities was $9.3 million at December 31, 2025 and $13.4 million at December 31, 2024. The decrease in equity securities was due to a disposition of certain equity investments

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no longer permissible under the Volcker Rule, which prohibits banks with more than $10 billion in assets from holding certain private equity investments. The Company reviews its portfolio of equity securities for impairment at least quarterly.

Low-Income Housing Tax Credit Investments

The Company invests in affordable housing projects that qualify for the low-income housing tax credit (LIHTC), which is designed to promote private development of low-income housing. The Company’s LIHTC investments were $94.9 million and $58.6 million at December 31, 2025 and 2024, respectively and are included in other assets on the consolidated balance sheet. Unfunded commitments to these investments as of December 31, 2025 totaled $63.5 million.

New Market Tax Credit Investments

The Company invests in active low-income community businesses that qualify for New Market Tax Credits. New Market Tax Credit investments are made through Community Development Entities and such entities are qualified through the US Department of the Treasury. The Company’s NMTC investments were $8.9 million and $7.5 million at December 31, 2025 and 2024, respectively and are included in other assets on the consolidated balance sheet. There are no unfunded commitments.

Historic Tax Credit Investments

The Company invests in rehabilitation projects that qualify for Historic Tax Credits. Total Historic Tax Credit investments were $8.6 million and $6.3 million at December 31, 2025 and 2024, respectively, and are included in other assets on the consolidated balance sheet. Unfunded commitments to these investments as of December 31, 2025 totaled $2.6 million.

See Note (6) of the Notes to Consolidated Financial Statements for disclosures regarding these investments.

Liquidity and Funding

The Company’s principal source of liquidity and funding is its broad deposit base generated from customer relationships. The availability of deposits is affected by economic conditions, competition with other financial institutions and alternative investments available to customers. Through interest rates paid, service charge levels and services offered, the Company can affect its level of deposits to a limited extent. The level and maturity of funding necessary to support the Company’s lending and investment functions is determined through the Company’s asset/liability management process. The Company currently does not rely heavily on long-term borrowings and does not utilize brokered CDs. The Company maintains lines of credit from the Federal Home Loan Bank (“FHLB”), federal funds lines of credit with other banks and could also utilize the sale of loans, securities and liquidation of other assets as sources of liquidity and funding. The Company is highly liquid, with percent of cash and due from banks, interest-bearing deposits with banks and federal funds sold to total assets of 30.3% at December 31, 2025, compared to 26.2% at December 31, 2024. The increase was related to an increase in interest-bearing deposits in addition to maturing securities.

Historically, BancFirst has more liquidity than its peers. This liquidity positions BancFirst to respond to increased loan demand and other requirements for funds, or to decreases in funding sources. The liquidity of BancFirst Corporation, however, is dependent upon dividend payments from BancFirst and its ability to obtain financing and or raise capital. Banking regulations limit bank dividends based upon net earnings retained by BancFirst and minimum capital requirements. Dividends in excess of these limits require regulatory approval. At January 1, 2026, BancFirst had approximately $204.9 million of equity available for dividends to BancFirst Corporation without regulatory approval. During 2025, BancFirst declared four common stock dividends totaling $75.8 million and two preferred stock dividends totaling $1.9 million to BancFirst Corporation. During 2025, Pegasus declared special dividends totaling $7.4 million to BancFirst Corporation.

Deposits

At December 31, 2025, deposits totaled $12.7 billion, an increase of $951.8 million from December 31, 2024. The increase was primarily related to organic growth in interest-bearing deposits as well as its acquisition of ABOK, which added $329.5 million at December 31, 2025. The Company’s core deposits provide it with a stable, low-cost funding source. The Company’s core deposits as a percentage of total deposits was 94.8% at December 31, 2025 and 95.5% December 31, 2024. Noninterest-bearing deposits to total deposits were 30.8% at December 31, 2025, compared to 33.3% at December 31, 2024.

Uninsured deposits are defined as the portion of deposit accounts in U.S. offices that exceed the FDIC insurance limit and amounts in any other uninsured investment or deposit account that are classified as deposits and are not subject to any federal or state deposit

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insurance regimes. Total uninsured deposits were $4.3 billion and $4.0 billion at December 31, 2025 and 2024, respectively, as calculated per regulatory guidance. This was approximately 34% of deposits at both December 31, 2025 and 2024.

Off-balance-sheet sweep accounts totaled $4.9 billion at December 31, 2025, compared to $5.2 billion at December 31, 2024. The movement of customers' funds into the Company's off-balance-sheet sweep accounts affected the balances of both cash and deposits.

ANALYSIS OF AVERAGE DEPOSITS

The following table sets forth average deposits and rates paid by category:

MATURITY OF TIME DEPOSITS

The following table shows the maturity of time deposits that are in excess of the Federal Deposit Insurance Corporation's insurance limit:

At December 31, 2025, 86.6% of the Company’s uninsured time deposits mature in one year or less.

Short-Term Borrowings

See Note (9) of the Notes to Consolidated Financial Statements for a discussion of short-term borrowings.

Lines of Credit

See Note (10) of the Notes to Consolidated Financial Statements for a discussion of the Company’s lines of credit.

Subordinated Debt

See Note (11) of the Notes to Consolidated Financial Statements for a complete discussion of the Company’s subordinated debt.

Capital Resources

Stockholders’ equity totaled $1.9 billion at December 31, 2025, compared to $1.6 billion at December 31, 2024. In addition to net income of $240.6 million, other changes in stockholders’ equity during the year ended December 31, 2025 included $4.7 million in common stock issuances related to stock-based compensation plans, $22.7 million in common stock issuances related to the acquisition of ABOK, $3.7 million related to stock-based compensation arrangements, and a $24.6 million increase in other comprehensive income,

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that were partially offset by $63.4 million in dividends. The Company’s average stockholders’ equity to average assets for 2025 was 12.22% compared to 11.78% for 2024. The Company’s leverage ratio and total risk-based capital ratios at December 31, 2025 were well in excess of the regulatory requirements. Banking institutions are generally expected to maintain capital well above the minimum levels. The Company’s trust preferred securities qualify as Tier 1 capital and its Subordinated Notes qualify as Tier 2 capital under bank regulatory guidelines.

See Note (15) of the Notes to Consolidated Financial Statements for a discussion of capital ratio requirements.

See Note (11) of the Notes to Consolidated Financial Statements for disclosures regarding the Company’s Subordinated Debt.

On August 5, 2025, the Company filed with the Securities and Exchange Commission (“SEC”) an automatic shelf registration statement on Form S-3, which became effective upon filing with the SEC. Under the shelf registration, the Company may offer and sell, from time to time, an indeterminate amount of its common stock in one or more future offerings.

The Company has adopted a Stock Repurchase Program (the “SRP”). The SRP may be used as a means to increase earnings per share and return on equity. In addition, the SRP may be used to purchase treasury stock for the issuance of stock related to stock-based compensation plans, to provide liquidity for optionees to dispose of stock from exercises of their stock options and to provide liquidity for stockholders wishing to sell their stock. All shares repurchased under the SRP have been retired and not held as treasury stock. The timing, price and amount of stock repurchases under the SRP is determined by management and approved by the Company’s Executive Committee. At December 31, 2025, up to 479,784 shares could be repurchased under the SRP. No shares were repurchased for the year ended December 31, 2025 or 2024.

Future dividend payments will be determined by the Company’s Board of Directors considering the earnings, financial condition and capital needs of the Company, BancFirst, Pegasus, Worthington, ABOK, applicable governmental policies and regulations and such other factors as the Board of Directors deems appropriate. While no assurance can be given as to the Company’s ability to pay dividends, management believes that, based upon the anticipated performance of the Company, regular dividend payments will continue in 2026.

Related Party Transactions

See Note (18) of the Notes to Consolidated Financial Statements for disclosures regarding the Company’s related party transactions.

Liquidity Risk and Off-Balance Sheet Arrangements

Liquidity is the ability to meet financial obligations through the maturity or sale of existing assets or the acquisition of additional funds. Various financial obligations, including contractual obligations and commercial commitments, may require future cash payments by the Company. Certain obligations are recognized on the Consolidated Balance Sheets, while others are off-balance sheet under U.S. generally accepted accounting principles. The Company currently has 7.20% Junior Subordinated Debentures, Subordinated Notes, operating and financing lease payments, time deposit payments, low-income housing partnership commitments and historic tax credit commitments. The Company’s 7.20% Junior Subordinated Debentures mature on March 31, 2034. The Company's Subordinated Notes mature on June 30, 2036. The Company has consistently generated positive net income and the Company currently expects to have positive net income for 2026. Management does not currently know of any trends that would cause the Company to be unable to provide for current obligations in the next twelve months.

Refer to Notes 6, 8, 11, 19 and 20 to the consolidated financial statements for further information regarding these contractual obligations.

The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include loan commitments and standby letters of credit, which involve elements of credit and interest-rate risk to varying degrees. The Company’s exposure to credit loss in the event of nonperformance by the other party to the instrument is represented by the instrument’s contractual amount. To control this credit risk, the Company uses the same underwriting standards as it uses for loans recorded on the consolidated balance sheet. The Company had $2.4 billion and $2.5 billion in loan commitments at December 31, 2025 and 2024, respectively. The Company had $87.8 million and $102.6 million in stand-by letters of credit at December 31, 2025 and 2024, respectively. Loan commitments are agreements to lend to a customer, as long as there is no violation of any condition established in the contract. Stand-by letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. These instruments generally have fixed expiration dates or other termination

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clauses. Since many of the instruments are expected to expire without being drawn upon, the total amounts do not necessarily represent commitments that will be funded in the future.