C & F FINANCIAL CORP (CFFI)
SIC breadcrumb: Finance, Insurance, And Real Estate > Depository Institutions > SIC 6022 State Commercial Banks
SEC company page: https://www.sec.gov/edgar/browse/?CIK=913341. Latest filing source: 0000913341-26-000010.
Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
|---|---|---|---|---|
| Revenue | 140,841,000 | USD | 2025 | 2026-03-03 |
| Net income | 26,835,000 | USD | 2025 | 2026-03-03 |
| Assets | 2,768,494,000 | USD | 2025 | 2026-03-03 |
Financials
Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-03-03. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000913341.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.
| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | 115,486,000 | 116,825,000 | 118,916,000 | 111,897,000 | 138,138,000 | 135,200,000 | 122,676,000 | 127,322,000 | 127,313,000 | 140,841,000 |
| Net income | 13,459,000 | 6,572,000 | 18,020,000 | 18,859,000 | 22,117,000 | 28,667,000 | 29,159,000 | 23,604,000 | 19,834,000 | 26,835,000 |
| Diluted EPS | 3.89 | 1.88 | 5.15 | 5.47 | 6.06 | 7.95 | 8.29 | 6.92 | 6.01 | 8.29 |
| Operating cash flow | 26,977,000 | 25,775,000 | 47,554,000 | -14,632,000 | -80,374,000 | 157,387,000 | 90,559,000 | 38,811,000 | 36,766,000 | 24,490,000 |
| Capital expenditures | 2,708,000 | 4,180,000 | 3,374,000 | 2,706,000 | 10,228,000 | 4,786,000 | 3,394,000 | 1,459,000 | 3,486,000 | 2,329,000 |
| Dividends paid | 4,464,000 | 4,637,000 | 4,931,000 | 5,131,000 | 5,546,000 | 5,675,000 | 5,756,000 | 5,986,000 | 5,780,000 | 5,953,000 |
| Share buybacks | 414,000 | 560,000 | 1,537,000 | 4,917,000 | 1,061,000 | 8,232,000 | 5,373,000 | 7,758,000 | 8,761,000 | 943,000 |
| Assets | 1,451,992,000 | 1,509,056,000 | 1,521,411,000 | 1,657,432,000 | 2,086,310,000 | 2,264,521,000 | 2,332,317,000 | 2,438,498,000 | 2,563,374,000 | 2,768,494,000 |
| Liabilities | 1,312,778,000 | 1,367,354,000 | 1,369,453,000 | 1,492,153,000 | 1,891,839,000 | 2,053,497,000 | 2,136,084,000 | 2,220,982,000 | 2,336,404,000 | 2,506,146,000 |
| Stockholders' equity | 139,214,000 | 141,702,000 | 151,958,000 | 164,798,000 | 193,805,000 | 210,318,000 | 195,634,000 | 216,878,000 | 226,360,000 | 261,753,000 |
| Free cash flow | 24,269,000 | 21,595,000 | 44,180,000 | -17,338,000 | -90,602,000 | 152,601,000 | 87,165,000 | 37,352,000 | 33,280,000 | 22,161,000 |
Ratios
| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Net margin | 11.65% | 5.63% | 15.15% | 16.85% | 16.01% | 21.20% | 23.77% | 18.54% | 15.58% | 19.05% |
| Return on equity | 9.67% | 4.64% | 11.86% | 11.44% | 11.41% | 13.63% | 14.90% | 10.88% | 8.76% | 10.25% |
| Return on assets | 0.93% | 0.44% | 1.18% | 1.14% | 1.06% | 1.27% | 1.25% | 0.97% | 0.77% | 0.97% |
| Liabilities / equity | 9.43 | 9.65 | 9.01 | 9.05 | 9.76 | 9.76 | 10.92 | 10.24 | 10.32 | 9.57 |
Financial Charts
Quarterly
Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-11. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000913341.json.
| Quarter | End Date | Revenue | Net Income | Diluted EPS | Method |
|---|---|---|---|---|---|
| 2022-Q2 | 2022-06-30 | 1.91 | reported discrete quarter | ||
| 2022-Q3 | 2022-09-30 | 1.85 | reported discrete quarter | ||
| 2023-Q1 | 2023-03-31 | 1.86 | reported discrete quarter | ||
| 2023-Q2 | 2023-06-30 | 32,108,000 | 6,306,000 | 1.84 | reported discrete quarter |
| 2023-Q3 | 2023-09-30 | 30,482,000 | 5,789,000 | 1.71 | reported discrete quarter |
| 2023-Q4 | 2023-12-31 | 32,331,000 | 5,068,000 | derived Q4 = FY annual - nine-month YTD | |
| 2024-Q1 | 2024-03-31 | 30,650,000 | 3,401,000 | 1.01 | reported discrete quarter |
| 2024-Q2 | 2024-06-30 | 31,152,000 | 5,007,000 | 1.50 | reported discrete quarter |
| 2024-Q3 | 2024-09-30 | 33,461,000 | 5,389,000 | 1.65 | reported discrete quarter |
| 2024-Q4 | 2024-12-31 | 32,050,000 | 6,037,000 | derived Q4 = FY annual - nine-month YTD | |
| 2025-Q1 | 2025-03-31 | 32,583,000 | 5,368,000 | 1.66 | reported discrete quarter |
| 2025-Q2 | 2025-06-30 | 36,356,000 | 7,691,000 | 2.37 | reported discrete quarter |
| 2025-Q3 | 2025-09-30 | 36,018,000 | 7,075,000 | 2.18 | reported discrete quarter |
| 2025-Q4 | 2025-12-31 | 35,884,000 | 6,701,000 | derived Q4 = FY annual - nine-month YTD | |
| 2026-Q1 | 2026-03-31 | 36,259,000 | 6,747,000 | 2.08 | reported discrete quarter |
Quarterly Charts
Macro Cross-References
- CPIAUCSL - Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
- UNRATE - Unemployment Rate
- FEDFUNDS - Federal Funds Effective Rate
- CES0500000003 - Average Hourly Earnings of All Employees, Total Private
- DFEDTARU - Federal Funds Target Range - Upper Limit
- DFEDTARL - Federal Funds Target Range - Lower Limit
- DGS3MO - Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
- DGS2 - Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
- DGS10 - Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- DGS30 - Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
- T10Y2Y - 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
- CPILFESL - Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
- CPIUFDSL - Consumer Price Index for All Urban Consumers: Food
- CPIENGSL - Consumer Price Index for All Urban Consumers: Energy
- CUSR0000SAH1 - Consumer Price Index for All Urban Consumers: Shelter
- PCEPI - Personal Consumption Expenditures: Chain-type Price Index
- PCEPILFE - Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
- PPIACO - Producer Price Index by Commodity: All Commodities
- T10YIE - 10-Year Breakeven Inflation Rate
- U6RATE - Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
- PAYEMS - All Employees, Total Nonfarm
- CIVPART - Labor Force Participation Rate
- EMRATIO - Employment-Population Ratio
- UNEMPLOY - Unemployed
- CE16OV - Employment Level
- ICSA - Initial Claims
- JTSJOL - Job Openings: Total Nonfarm
- JTSQUR - Quits: Total Nonfarm
- GDPC1 - Real Gross Domestic Product
- A191RL1Q225SBEA - Real Gross Domestic Product: Percent Change from Preceding Period
- INDPRO - Industrial Production: Total Index
- TCU - Capacity Utilization: Total Index
- HOUST - New Privately-Owned Housing Units Started: Total Units
- PERMIT - New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
- RSAFS - Advance Retail Sales: Retail Trade
- PCE - Personal Consumption Expenditures
- DSPIC96 - Real Disposable Personal Income
- PSAVERT - Personal Saving Rate
- M2SL - M2
- BOPGSTB - U.S. International Trade in Goods and Services: Balance
- MSPUS - Median Sales Price of Houses Sold for the United States
- HSN1F - New One Family Houses Sold: United States
- RHORUSQ156N - Homeownership Rate in the United States
- TTLCONS - Total Construction Spending: Total Construction in the United States
- RRVRUSQ156N - Rental Vacancy Rate in the United States
- TOTALSL - Total Consumer Credit Owned and Securitized
- REVOLSL - Revolving Consumer Credit Owned and Securitized
- DRCCLACBS - Delinquency Rate on Credit Card Loans, All Commercial Banks
- GDP - Gross Domestic Product
- GPDI - Gross Private Domestic Investment
- GCE - Government Consumption Expenditures and Gross Investment
- PCEC - Personal Consumption Expenditures
- NETEXP - Net Exports of Goods and Services
- GFDEBTN - Federal Debt: Total Public Debt
- GFDEGDQ188S - Federal Debt: Total Public Debt as Percent of Gross Domestic Product
- FYFSD - Federal Surplus or Deficit
- FGRECPT - Federal Government Current Receipts
- FGEXPND - Federal Government: Current Expenditures
- MANEMP - All Employees, Manufacturing
- USCONS - All Employees, Construction
- USTRADE - All Employees, Retail Trade
- USFIRE - All Employees, Financial Activities
- USGOVT - All Employees, Government
- AWHAETP - Average Weekly Hours of All Employees, Total Private
- DGORDER - Manufacturers' New Orders: Durable Goods
- NEWORDER - Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
- BUSINV - Total Business Inventories
- EXPGS - Exports of Goods and Services
- IMPGS - Imports of Goods and Services
- IR - Import Price Index (End Use): All Commodities
- PPIFIS - Producer Price Index by Commodity: Final Demand
Latest quarter (10-Q)
Latest 10-Q source: 0000913341-26-000028.
ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion supplements and provides information about the major components of the results of operations, financial condition, liquidity and capital resources of the Corporation. This discussion and analysis should be read in conjunction with the accompanying consolidated financial statements. In addition to current and historical information, the following discussion and analysis contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to our future business, financial condition or results of operations. For a description of certain factors that may have a significant impact on our future business, financial condition or results of operations, see “Cautionary Statement About Forward-Looking Statements” at the end of this discussion and analysis. OVERVIEW Our primary financial goals are to maximize the Corporation’s earnings and to deploy capital in profitable growth initiatives that will enhance long-term shareholder value. We track three primary financial performance measures in order to assess the level of success in achieving these goals: (1) return on average assets (ROA), (2) return on average equity (ROE), and (3) growth in earnings. In addition to these financial performance measures, we track the performance of the Corporation’s three business segments: community banking, mortgage banking, and consumer finance. We balance these financial measures with acceptable levels of interest rate risk, while satisfying liquidity and capital requirements and monitoring asset quality. We also actively manage our capital through growth, dividends and share repurchases, while considering the need to maintain a strong capital position. The following table presents selected financial performance highlights for the periods indicated. TABLE 1: Financial Performance Highlights (Dollars in thousands, except for per share data) Three Months Ended March 31, 2026 2025 Net Income (Loss): Community Banking $ 7,110 $ 5,445 Mortgage Banking 910 431 Consumer Finance (81) 226 Other (1,145) (707) Consolidated net income $ 6,794 $ 5,395 Earnings per share - basic and diluted $ 2.08 $ 1.66 Return on average assets 0.97 % 0.84 % Return on average equity 10.19 % 9.35 % Return on average tangible common equity (ROTCE)1 11.28 % 10.65 % 1 Refer to “Use of Certain Non-GAAP Financial Measures,” below, for information about these non-GAAP financial measures, including a quantitative reconciliation to the most directly comparable financial measures calculated in accordance with GAAP. Consolidated net income increased $1.4 million for the first quarter of 2026 compared to the same period in 2025 due primarily to higher net income at the community banking and mortgage banking segments, partially offset by a net loss at the consumer finance segment. A discussion of the performance of our business segments is included under the heading “Business Segments” in the “Results of Operations” section of this discussion and analysis. 34 Table of Contents Key factors affecting comparison for the first quarter of 2026 are as follows. ● Community banking segment loans grew $24.1 million, or 6.1 percent annualized, compared to December 31, 2025; ● Consumer finance segment loans decreased $3.6 million, or 3.1 percent annualized, compared to December 31, 2025; ● Deposits increased $53.7 million, or 9.2 percent annualized, compared to December 31, 2025; ● Consolidated annualized net interest margin was 4.27 percent for the first quarter of 2026 compared to 4.16 percent for the first quarter of 2025; ● The consumer finance segment experienced net charge-offs at an annualized rate of 2.98 percent of average total loans for the first quarter of 2026 compared to 2.64 percent for the first quarter of 2025; and ● Mortgage banking segment loan originations increased $65.9 million, or 57.9 percent, to $179.6 million for the first quarter of 2026 compared to the first quarter of 2025. Subsequent to March 31, 2026, the Corporation completed the sale (Transaction) of its membership interest in Bearing Insurance Group, LLC to an unaffiliated third party, effective May 1, 2026. Following the completion of Transaction, the Corporation executed a strategic restructuring of a portion of its securities available for sale portfolio. For more information on these transactions, each of which will impact the Corporation’s financial results for the second quarter of 2026, see Part I, Item 1, “Financial Statements” under the heading “Note 14: Subsequent Events” in this Quarterly Report on Form 10-Q. Capital Management and Dividends Total equity was $266.1 million at March 31, 2026 compared to $262.3 million at December 31, 2025. Under regulatory capital standards, the Corporation’s tier 1 risk-based capital and total risk-based capital ratios at March 31, 2026 were 12.1 percent and 15.1 percent, respectively, compared to 12.2 percent and 15.2 percent, respectively, at December 31, 2025. At March 31, 2026, the book value per share of the Corporation’s common stock was $81.73 and tangible book value per share, which is a non-GAAP financial measure, was $73.70, compared to $80.64 and $72.60, respectively, at December 31, 2025. Total consolidated equity increased $3.8 million at March 31, 2026 compared to December 31, 2025 due primarily to net income, partially offset by dividends paid on the Corporation’s common stock and higher net unrealized losses in the market value of securities available for sale, which are recognized as a component of other comprehensive income. The Corporation’s securities available for sale are fixed income debt securities and their net unrealized loss position is a result of increased market interest rates since they were purchased. The Corporation expects to recover its investments in debt securities through scheduled payments of principal and interest. Unrealized losses are not expected to affect the earnings or regulatory capital of the Corporation or C&F Bank. The accumulated other comprehensive loss related to the Corporation’s securities available for sale, net of deferred income taxes, increased to $11.7 million at March 31, 2026, compared to $10.2 million at December 31, 2025 due primarily to fluctuations in debt security market interest rates. The Corporation’s Board of Directors declared a quarterly cash dividend of 48 cents per share during the first quarter of 2026, which was paid on April 1, 2026. This dividend represents a payout ratio of 23.1 percent of earnings per share for the first quarter of 2026. The Board of Directors of the Corporation continually reviews the amount of cash dividends per share and the resulting dividend payout ratio in light of changes in economic conditions, current and future capital levels and requirements and expected future earnings. In making its decision on the payment of dividends on the Corporation’s common stock, the Corporation’s Board of Directors considers operating results, financial condition, capital adequacy, regulatory requirements, shareholder returns, growth expectations and other factors. The Corporation has a share repurchase program, effective January 1, 2026 through December 31, 2026, that was authorized by the Board of Directors to repurchase up to $5.0 million of the Corporation’s common stock (the 2026 Repurchase Program). During the first quarter of 2026, the Corporation repurchased 4,279 shares, or $309,000, of its common stock under the 2026 Repurchase Program. 35 Table of Contents CRITICAL ACCOUNTING ESTIMATES The preparation of financial statements requires us to make estimates and assumptions. Those accounting policies with the greatest uncertainty and that require management’s most difficult, subjective or complex judgments affecting the application of these policies, and the greatest likelihood that materially different amounts would be reported under different conditions, or using different assumptions, are described below. Allowance for Credit Losses: We establish the allowance for credit losses through charges to earnings in the form of a provision for credit losses. Loan losses are charged against the allowance for credit losses for the difference between the carrying value of the loan and the estimated net realizable value or fair value of the collateral, if collateral dependent, when management believes that the collectability of the principal is unlikely. Subsequent recoveries, if any, are credited to the allowance. The allowance represents management’s current estimate of expected credit losses over the contractual term of loans held for investment, and is recorded at an amount that, in management’s judgment, reduces the recorded investment in loans to the net amount expected to be collected. Management’s judgment in determining the level of the allowance is based on evaluations of historical loan losses, current conditions and reasonable and supportable forecasts relevant to the collectability of loans. The measurement of the allowance for credit losses on commercial and consumer loans is based in part on the twelve-month forecast of the national unemployment rate, which we believe to be indicative of risk factors related to the collectability of commercial and consumer loans. Forecasts of the national unemployment rate are derived from the Federal Open Markets Committee of the Federal Reserve Board. For periods beyond those for which reasonable and supportable forecasts are available, projections are based on a reversion of the national unemployment rate from the last forecast to a historical average level over the following six months. In addition, management’s estimate of expected credit losses is based on the remaining life of loans held for investment, which is affected in part by changes in expected prepayment behavior and in the nature and volume of the loan portfolio. Management also assesses the risk of credit losses arising from external factors, such as changes in general market, economic and business conditions and the value of underlying collateral, to make qualitative adjustments in determining the recorded balance of the allowance for credit losses. This evaluation is inherently subjective because it requires estimates that are susceptible to significant revision as more information becomes available. These factors outside of the Corporation’s control are difficult to predict and can have significant impacts on the level of allowance that is required, which can be different than the level recorded based on the then-existing loan portfolio, unemployment rate forecast and other external factors that were used in the qualitative adjustments at that time. In evaluating the level of the allowance, we consider a range of possible assumptions and outcomes related to the various factors identified above. The level of the allowance is particularly sensitive to changes in the actual and forecasted national unemployment rate during the twelve-month forecast period and changes in current conditions or reasonably expected future conditions affecting the collectability of loans. Given the relationship between external variables used in the forecast and the qualitative adjustments made based on the assessment of available information relevant to assessing collectability that is not captured in the forecast, it is difficult to estimate the impact of a change in any one individual variable on the allowance for c [Excerpt truncated for page length; source filing is linked above.]
Latest 10-K MD&A
ITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion supplements and provides information about the major components of the results of operations, financial condition, liquidity and capital resources of the Corporation. This discussion and analysis should be read in conjunction with the accompanying consolidated financial statements. In addition to current and historical information, the following discussion and analysis contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to our future business, financial condition or results of operations. For a description of certain factors that may have a significant impact on our future business, financial condition or results of operations, see “Cautionary Statement Regarding Forward-Looking Statements” prior to Part I, Item 1. “Business.” OVERVIEW Our primary financial goals are to maximize the Corporation’s earnings and to deploy capital in profitable growth initiatives that will enhance long-term shareholder value. We track three primary financial performance measures in order to assess the level of success in achieving these goals: (1) return on average assets (ROA), (2) return on average equity (ROE), and (3) growth in earnings. In addition to these financial performance measures, we track the performance of the Corporation’s three business segments: community banking, mortgage banking, and consumer finance. We balance these financial measures with acceptable levels of interest rate risk, while satisfying liquidity and capital requirements and monitoring asset quality. We also actively manage our capital through growth, dividends and share repurchases, while considering the need to maintain a strong capital position. The following table presents selected financial performance highlights for the periods indicated: TABLE 1: Financial Performance Highlights (Dollars in thousands, except for per share data) Year Ended December 31, 2025 2024 2023 Net Income (Loss): Community Banking $ 27,231 $ 20,284 $ 22,928 Mortgage Banking 2,307 1,108 465 Consumer Finance 1,229 1,414 2,879 Other (3,776) (2,888) (2,526) Consolidated net income $ 26,991 $ 19,918 $ 23,746 Earnings per share - basic and diluted $ 8.29 $ 6.01 $ 6.92 Return on average assets 1.01 % 0.80 % 0.99 % Return on average equity 11.11 % 9.02 % 11.68 % Return on average tangible common equity (ROTCE)1 12.53 % 10.37 % 13.58 % 1 Refer to “Use of Certain Non-GAAP Financial Measures,” below, for information about these non-GAAP financial measures, including a reconciliation to the most directly comparable financial measures calculated in accordance with U.S. Generally Accepted Accounting Principles (GAAP). Consolidated net income and earnings per share were $27.0 million and $8.29, respectively, for the year ended December 31, 2025, compared to $19.9 million and $6.01, respectively, for the year ended December 31, 2024. The increase in consolidated net income for 2025 compared to 2024 was due primarily to higher net income at the community banking and mortgage banking segments, partially offset by a decrease in net income at the consumer finance segment. A discussion of the performance of our business segments is included under the heading “Business Segments” in the “Results of Operations” section of this discussion and analysis. 38 Table of Contents Key factors affecting comparisons for the years ended December 31, 2025 and 2024 are as follows. ● Community banking segment loans grew $136.7 million, or 9.4 percent; ● Consumer finance segment loans decreased $2.5 million, or less than one percent; ● Deposits increased $174.9 million, or 8.1 percent, a portion of which was due to the wind-down of the repurchase agreement program with certain commercial deposit customers during the third quarter of 2025. The balance of these repurchase agreements was $29.0 million at December 31, 2024; ● Consolidated net interest margin was 4.21 percent, compared to 4.12 percent; ● Community banking segment recorded a net reversal of provision for credit losses of $50,000, compared to a provision for credit losses of $1.7 million; ● Consumer finance segment provision for credit losses was $11.6 million for each of the years ended December 31, 2025 and 2024, respectively; ● Consumer finance segment net charge-offs were 2.59 percent, compared to 2.62 percent; ● Mortgage banking segment loan originations increased $152.5 million, or 28.9 percent; ● The Corporation issued new subordinated notes with an aggregate principal amount of $40.0 million in the second quarter of 2025 and concurrently repurchased its previously issued subordinated notes with aggregate principal amount of $20.0 million; and ● The Corporation expanded into Southwest Virginia with the opening of a new loan production office in Roanoke in the third quarter of 2025. Discussion of consolidated net income and earnings per share for the year ended December 31, 2023 has been omitted as such discussion was provided in Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” under the heading “Overview” in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on February 27, 2025, and is incorporated herein by reference. Capital Management and Dividends Total equity was $262.3 million at December 31, 2025, compared to $227.0 million at December 31, 2024. Under regulatory capital standards, the Corporation’s tier 1 risk-based capital and total risk-based capital ratios at December 31, 2025 were 12.2 percent and 15.2 percent, respectively, compared to 11.9 percent and 14.1 percent, respectively, at December 31, 2024. Total consolidated equity increased $35.4 million at December 31, 2025 compared to December 31, 2024, due primarily to net income and lower unrealized losses in the market value of securities available for sale, which are recognized as a component of other comprehensive income, partially offset by dividends paid on the Corporation’s common stock. The Corporation’s securities available for sale are fixed income debt securities and their unrealized loss position is a result of increased market interest rates since they were purchased. The Corporation expects to recover its investments in debt securities through scheduled payments of principal and interest. Unrealized losses are not expected to affect the earnings or regulatory capital of the Corporation or C&F Bank. The accumulated other comprehensive loss related to the Corporation’s securities available for sale, net of deferred income taxes, decreased to $10.2 million at December 31, 2025, compared to $23.7 million at December 31, 2024 due primarily to fluctuations in debt security market interest rates and a decrease in the balance of securities available for sale in an unrealized loss position as a result of maturities, calls and paydowns. The Corporation’s Board of Directors continued its historical practice of paying dividends in 2025. For the year ended December 31, 2025, the Corporation declared dividends totaling $1.84 per share, compared to $1.76 per share for the year ended December 31, 2024. The Board of Directors of the Corporation continually reviews the amount of cash dividends per share and the resulting dividend payout ratio in light of changes in economic conditions, current and future capital levels and requirements and expected future earnings. In making its decision on the payment of dividends on the Corporation’s common stock, the Corporation’s Board of Directors considers operating results, financial condition, capital adequacy, regulatory requirements, shareholder returns, growth expectations and other factors. 39 Table of Contents In December 2023, the Board of Directors authorized a program, effective January 1, 2024 through December 31, 2024, to repurchase up to $10.0 million of the Corporation’s common stock (the 2024 Repurchase Program). During the year ended December 31, 2024, the Corporation repurchased 160,694 shares, or $7.9 million, of its common stock under the 2024 Repurchase Program. In December 2024, the Board of Directors authorized a program, effective January 1, 2025 through December 31, 2025, to repurchase up to $5.0 million of the Corporation’s common stock (the 2025 Repurchase Program). During the year ended December 31, 2025, the Corporation did not make any repurchases of its common stock under the 2025 Repurchase Program. In December 2025, the Board of Directors authorized a new program, effective January 1, 2026 through December 31, 2026, to repurchase up to $5.0 million of the Corporation’s common stock (the 2026 Repurchase Program). Repurchases under the 2026 Repurchase Program may be made through privately negotiated transactions or open market transactions, including pursuant to a trading plan in accordance with Rule 10b5-1 and/or Rule 10b-18 under the Securities Exchange Act of 1934, as amended, and shares repurchased will be returned to the status of authorized and unissued shares of common stock. At December 31, 2025, the book value per share of the Corporation’s common stock was $80.64, and tangible book value per share, a non-GAAP measure, was $72.60, compared to $70.00 and $61.86 respectively, at December 31, 2024. Refer to “Use of Certain Non-GAAP Financial Measures,” below, for information about non-GAAP financial measures, including a reconciliation to the most directly comparable financial measures calculated in accordance with GAAP. 2026 Outlook The current economic environment is challenging across all levels, market conditions are shifting quickly, and competition is intensifying; however, we believe our strong capital position, history of profitability, and diverse income stream sources position us well for the challenging times ahead. We remain focused on maintaining our strong balance sheet, managing margins, maintaining strong liquidity and capital positions, and pursuing disciplined growth by focusing on the following: ● Performance and growth: Organically growing earning assets and deposits remains at the top of our strategic initiatives list. With the addition of a seasoned commercial banking team in Roanoke, Virginia at the community banking segment and multiple teams of mortgage originators at the mortgage banking segment during 2025, we believe we’re well-positioned to grow heading into 2026. ● Marketing and brand recognition: We are well underway in implementing our three-year strategic marketing plan, developed in partnership with an industry-leading marketing firm, to increase our visibility in metro markets including Richmond, Williamsburg, Fredericksburg, Charlottesville and now Roanoke. Initial digital metrics show that traffic to our refreshed websites and overall online engagement are up significantly over prior years. ● Cross-company collaboration: Building and strengthening customer relationships through enhanced cross-selling efforts and leveraging the professional expertise of loyal and long-term teammates across our subsidiaries has been and will remain a strategic initiative. 40 Table of Contents ● People and community engagement: We make substantial investments in training, benefits, and career growth resources to attract and retain the very best talent. Additionally, we are highly focused on developing our “next generation” of leaders as the importance of succession planning grows. In 2025, our teammates volunteered, mentored, and partnered with local organizations to expand access to financial wellness and economic opportunity, which directly reflect our culture and values, building on trust we have earned in the markets where we live and work. ● Efficiency and technology: We are evaluating potential use cases across all subsidiaries and departments for the prudent adoption of Artificial Intelligence (AI) including robotic process automation, generative and agentic AI, and machine learning tools. We continue to simplify processes, modernize tools, and improve customer experience – from digital onboarding to faster, more transparent workflows. ● Risk management: We have strengthened capabilities and resources to combat an ever-changing fraud threat environment, primarily with stronger leverage and refinement of tools and technology, as well as proactive education and communication with our customers. Credit discipline remains a top priority in 2026 and is why we actively monitor industry concentrations and market trends – especially in the commercial real estate and consumer portfolios. We believe the Corporation’s diversified business model, including community banking, mortgage banking, and consumer finance, provides a strong foundation in times of volatility. Additional factors that could influence our financial performance in 2026 in our business segments include: ● Community Banking: C&F Bank delivered solid loan and deposit growth in 2025 with loan growth of 9.4% and deposit growth of 8.1%. Organically growing earning assets and deposits remain key strategic initiatives for 2026. We recruited a team of seasoned commercial bankers in Southwest Virginia, which positions our company to compete in key new markets. C&F Wealth Management (included in the results of the community banking segment) increased assets under management during 2025 and will continue to provide personalized client service while benefiting from a much closer relationship with our subsidiaries through internal referrals. ● Mortgage Banking: Earnings improved at C&F Mortgage during 2025 with loan originations increasing by 28.9%. We onboarded two new teams of mortgage originators during 2025 and plan to continue to drive growth through strategic partnerships and to increase revenues at Lender Solutions, a division that provides certain mortgage loan origination functions as a service to other financial institutions. ● Consumer Finance: Despite elevated funding costs, heighted competition and credit normalization toward pre-pandemic levels, C&F Finance remained profitable in 2025. In 2026, we will continue to closely monitor economic and industry conditions, focus on additional efficiencies and leverage our investments in technology to continue pursuing growth in our loan portfolio. CRITICAL ACCOUNTING ESTIMATES The preparation of financial statements requires us to make estimates and assumptions. Those accounting policies with the greatest uncertainty and that require management’s most difficult, subjective or complex judgments affecting the application of these policies, and the greatest likelihood that materially different amounts would be reported under different conditions, or using different assumptions, are described below. Allowance for Credit Losses: We establish the allowance for credit losses through charges to earnings in the form of a provision for credit losses. Loan losses are charged against the allowance for credit losses for the difference between the carrying value of the loan and the estimated net realizable value or fair value of the collateral, if collateral dependent, when management believes that the collectability of the principal is unlikely. Subsequent recoveries, if any, are credited to the allowance. The allowance represents management’s current estimate of expected credit losses over the contractual term of loans held for investment, and is recorded at an amount that, in management’s judgment, reduces the recorded investment in loans to the net amount expected to be collected. 41 Table of Contents Management’s judgment in determining the level of the allowance is based on evaluations of historical loan losses, current conditions and reasonable and supportable forecasts relevant to the collectability of loans. The measurement of the allowance for credit losses on commercial and consumer loans is based in part on the twelve-month forecast of the national unemployment rate, which we believe to be indicative of risk factors related to the collectability of commercial and consumer loans. Forecasts of the national unemployment rate are derived from the Federal Open Markets Committee of the Federal Reserve Board. For periods beyond those for which reasonable and supportable forecasts are available, projections are based on a reversion of the national unemployment rate from the last forecast to a historical average level over the following six months. In addition, management’s estimate of expected credit losses is based on the remaining life of loans held for investment, which is affected in part by changes in expected prepayment behavior and in the nature and volume of the loan portfolio. Management also assesses the risk of credit losses arising from external factors, such as changes in general market, economic and business conditions and the value of underlying collateral, to make qualitative adjustments in determining the recorded balance of the allowance for credit losses. This evaluation is inherently subjective because it requires estimates that are susceptible to significant revision as more information becomes available. These factors outside of the Corporation’s control are difficult to predict and can have significant impacts on the level of allowance that is required, which can be different than the level recorded based on the then-existing loan portfolio, unemployment rate forecast and other external factors that were used in the qualitative adjustments at that time. In evaluating the level of the allowance, we consider a range of possible assumptions and outcomes related to the various factors identified above. The level of the allowance is particularly sensitive to changes in the actual and forecasted national unemployment rate during the twelve-month forecast period and changes in current conditions or reasonably expected future conditions affecting the collectability of loans. Given the relationship between external variables used in the forecast and the qualitative adjustments made based on the assessment of available information relevant to assessing collectability that is not captured in the forecast, it is difficult to estimate the impact of a change in any one individual variable on the allowance for credit losses. The impact of a change in an assumption or input may be amplified by or partially offset by the impact of a change in another assumption or input. Goodwill: The Corporation’s goodwill was recognized in connection with past business combinations and is reported at the community banking segment and the consumer finance segment. The Corporation reviews the carrying value of goodwill at least annually or more frequently if certain impairment indicators exist. In testing goodwill for impairment, the Corporation may first consider qualitative factors to determine whether the existence of events or circumstances lead to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, we conclude that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then no further testing is required and the goodwill of the reporting unit is not impaired. If the Corporation elects to bypass the qualitative assessment or if we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the fair value of the reporting unit is compared with its carrying value to determine whether an impairment exists. These qualitative factors include, but are not limited to, general market, economic and business conditions; overall financial performance; reporting unit-specific performance, events or changes; and market value of the Corporation’s common stock. Several of these factors are outside of the Corporation’s control and are difficult to predict, which could have a significant impact on the qualitative assessment of the likelihood that the fair value of a reporting unit is less than its carrying amount. In the last evaluation of goodwill at the community banking segment and the consumer finance segment, which was the annual evaluation in the fourth quarter of 2025, the Corporation concluded that no impairment existed based on an assessment of qualitative factors. For further information concerning accounting policies, refer to Item 8. “Financial Statements and Supplementary Data” under the heading “Note 1: Summary of Significant Accounting Policies.” 42 Table of Contents RESULTS OF OPERATIONS NET INTEREST INCOME The following table shows the average balance sheets, the amounts of interest earned on earning assets, with related yields, and interest expense on interest-bearing liabilities, with related rates, for each of the years ended December 31, 2025, 2024 and 2023. Interest on tax-exempt loans and securities is presented on a taxable-equivalent basis (which converts the income on loans and investments for which no income taxes are paid to the equivalent yield as if income taxes were paid) using the federal corporate income tax rate of 21 percent that was applicable for all periods presented. Average balances of securities available for sale are included at amortized cost. Loans include loans held for sale. Loans placed on a nonaccrual status are included in the balances and are included in the computation of yields, but had no material effect. Accretion and amortization of fair value purchase adjustments related to business combinations are included in the computation of yields on loans and investments and on the cost of borrowings, but had no material effect. 43 Table of Contents TABLE 2: Average Balances, Income and Expense, Yields and Rates 2025 2024 2023 Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/ (Dollars in thousands) Balance Expense Rate Balance Expense Rate Balance Expense Rate Assets Loans: Community banking segment $ 1,516,513 $ 84,306 5.56 % $ 1,378,131 75,707 5.49 % 1,214,143 62,188 5.12 % Mortgage banking segment 36,731 2,336 6.36 30,737 1,897 6.17 25,598 1,695 6.62 Consumer finance segment 464,443 49,179 10.59 476,775 49,684 10.42 473,885 47,263 9.97 Total loans 2,017,687 135,821 6.73 1,885,643 127,288 6.75 1,713,626 111,146 6.49 Securities - available for sale: Taxable 340,860 9,475 2.78 335,647 $ 7,563 2.25 $ 428,895 $ 9,110 2.12 Tax-exempt 122,346 4,940 4.04 119,978 4,516 3.76 108,006 3,600 3.33 Total securities - available for sale 463,206 14,415 3.11 455,625 12,079 2.65 536,901 12,710 2.37 Interest-bearing deposits in other banks 69,065 2,498 3.62 37,238 1,374 3.69 35,351 1,245 3.52 Total earning assets 2,549,958 152,734 5.99 2,378,506 140,741 5.92 2,285,878 125,101 5.47 Allowance for credit losses (40,633) (40,736) (41,047) Total non-earning assets 158,470 156,726 148,666 Total assets $ 2,667,795 $ 2,494,496 $ 2,393,497 Liabilities and Equity Interest-bearing deposits: Interest-bearing demand deposits $ 322,732 $ 2,076 0.64 % $ 327,700 $ 2,170 0.66 % $ 354,643 $ 2,134 0.60 % Savings and money market deposit accounts 527,951 6,289 1.19 476,707 4,424 0.93 526,634 3,141 0.60 Time deposits 852,766 31,093 3.65 767,721 31,465 4.10 541,252 15,112 2.79 Total interest-bearing deposits 1,703,449 39,458 2.32 1,572,128 38,059 2.42 1,422,529 20,387 1.43 Borrowings: Repurchase agreements 15,902 236 1.48 27,754 456 1.64 32,393 399 1.23 Other borrowings 105,005 5,595 5.33 91,713 4,304 4.69 116,908 5,644 4.83 Total borrowings 120,907 5,831 4.82 119,467 4,760 3.98 149,301 6,043 4.05 Total interest-bearing liabilities 1,824,356 45,289 2.48 1,691,595 42,819 2.53 1,571,830 26,430 1.68 Noninterest-bearing demand deposits 557,743 536,828 575,452 Other liabilities 42,663 45,217 42,954 Total liabilities 2,424,762 2,273,640 2,190,236 Equity 243,033 220,856 203,261 Total liabilities and equity $ 2,667,795 $ 2,494,496 $ 2,393,497 Net interest income $ 107,445 $ 97,922 $ 98,671 Interest rate spread 3.51 % 3.39 % 3.79 % Interest expense to average earning assets 1.78 % 1.80 % 1.16 % Net interest margin 4.21 % 4.12 % 4.31 % Interest income and expense are affected by fluctuations in interest rates, by changes in the volume of earning assets and interest-bearing liabilities, and by the interaction of rate and volume factors. The following table shows the direct causes of the year-to-year changes in the components of net interest income on a taxable-equivalent basis. The Corporation calculates the rate and volume variances using a formula prescribed by the SEC. Rate/volume variances, the third element in the calculation, are not shown separately in the table, but are allocated to the rate and volume variances in proportion to the absolute dollar amounts of each. 44 Table of Contents TABLE 3: Rate-Volume Recap 2025 from 2024 2024 from 2023 Increase (Decrease) Total Increase (Decrease) Total Due to Increase Due to Increase (Dollars in thousands) Rate Volume (Decrease) Rate Volume (Decrease) Interest income: Loans: Community banking segment $ 969 $ 7,630 $ 8,599 $ 4,712 $ 8,807 $ 13,519 Mortgage banking segment 59 380 439 (121) 323 202 Consumer finance segment 799 (1,304) (505) 2,133 288 2,421 Securities - available for sale: Taxable 1,794 118 1,912 530 (2,077) (1,547) Tax-exempt 335 89 424 492 424 916 Interest-bearing deposits in other banks (27) 1,151 1,124 61 68 129 Total interest income 3,929 8,064 11,993 7,807 7,833 15,640 Interest expense: Interest-bearing deposits: Interest-bearing demand deposits (63) (31) (94) 204 (168) 36 Savings and money market deposit accounts 1,347 518 1,865 1,606 (323) 1,283 Time deposits (3,656) 3,284 (372) 8,647 7,706 16,353 Borrowings: Repurchase agreements (41) (179) (220) 120 (63) 57 Other borrowings 626 665 1,291 (159) (1,181) (1,340) Total interest expense (1,787) 4,257 2,470 10,418 5,971 16,389 Change in net interest income $ 5,716 $ 3,807 $ 9,523 $ (2,611) $ 1,862 $ (749) Net interest income, on a taxable-equivalent basis, for 2025 increased to $107.4 million, compared to $97.9 million for 2024, due primarily to higher average balances of earning assets and an increase in net interest margin. Average earning assets grew $171.5 million, or 7.2 percent, to $2.55 billion for 2025 compared to $2.38 billion for 2024, and net interest margin increased 9 basis points to 4.21 percent in 2025 compared to 4.12 percent in 2024. Net interest margin increased due primarily to higher average interest rates on securities available for sale, a shift in the mix of interest-earning assets towards higher-earning assets and lower average interest rates on deposits, partially offset by higher average cost of borrowings. The Federal Reserve Bank decreased the target federal funds interest rate from an upper limit of 5.50 percent at December 31, 2023 to 4.50 percent at December 31, 2024 and to 3.75 percent by December 31, 2025. The yield on interest-earning assets and cost of interest-bearing liabilities increased by 7 basis points and decreased by 5 basis points, respectively, for 2025, compared to 2024. Average loans, which includes both loans held for investment and loans held for sale, increased $132.0 million to $2.02 billion for 2025, compared to $1.89 billion for 2024. Average loans held for investment at the community banking segment increased $138.4 million, or 10.0 percent, to $1.52 billion for 2025, compared to $1.38 billion for 2024, due primarily to growth in commercial real estate, land acquisition and development and equity lines segments of the loan portfolio. Average loans held for investment at the consumer finance segment decreased $12.3 million, or 2.6 percent, to $464.4 million for 2025, compared to $476.8 million for 2024, due primarily to a decrease in marine and recreational vehicle (RV) loans as the third party administrator of that program significantly decreased sales of those loans to outside parties during 2025, which led to the consumer finance segment ending future purchases under the program during the third quarter of 2025. The marine and RV portfolio is expected to run off over the next several years as scheduled borrower payments are made on the existing loans. Average loans at the mortgage banking segment, which consist primarily of loans held for sale, increased $6.0 million, or 19.5 percent, to $36.7 million for 2025, compared to $30.7 million for 2024, due primarily to higher mortgage loan production volume in 2025 compared to 2024. Average loan yield increased at each of the community banking, consumer finance and mortgage banking segments, however, decreased 2 basis points overall to 6.73 percent for 2025, compared to 6.75 percent for 2024, due primarily to a shift in the mix of loans from the higher-yielding consumer finance segment to the community banking segment. The community banking segment average loan yield increased 7 basis points to 5.56 percent for 2025, compared to 5.49 percent for 2024, due primarily to a shift in the mix of the loan portfolio towards higher-yielding loans and renewals of fixed rate loans originated during periods of lower interest rates. The consumer finance segment average loan yield increased 17 basis points to 10.59 percent for 2025, compared to 10.42 percent for 2024, due primarily to a shift in the mix of the loan 45 Table of Contents portfolio with the termination of the lower-yielding marine and RV loan program and the portfolio composition in general shifting towards originations within the past three years, when interest rates were higher, as loans originated prior to that during periods of lower interest rates pay off or mature. The mortgage banking segment average loan yield increased 19 basis points to 6.36 percent for 2025, compared to 6.17 percent for 2024, due primarily to fluctuations in market interest rates. Average securities available for sale increased $7.6 million to $463.2 million for 2025, compared to $455.6 million for 2024, due primarily to purchases of mortgage-backed securities outpacing maturities, calls and paydowns throughout the portfolio. The average yield on the securities portfolio on a taxable-equivalent basis increased 46 basis points to 3.11 percent for 2025, compared to 2.65 percent for 2024, due primarily to purchases of securities during recent periods at higher average yields relative to the average yield of the portfolio as a whole and lower prepayment activity on mortgage-backed securities, which resulted in lower premium amortization. Average interest-bearing deposits in other banks, consisting primarily of excess cash reserves maintained at the Federal Reserve Bank, increased $31.8 million to $69.1 million for 2025, compared to $37.2 million for 2024. The average yield on interest-bearing deposits in other banks decreased 7 basis points to 3.62 percent for 2025, compared to 3.69 percent for 2024 due to the decrease in the federal funds interest rate beginning in September 2025. Average savings and money market and interest-bearing demand deposits combined increased $46.3 million to $850.7 million for 2025, compared to $804.4 million for 2024, and average noninterest-bearing demand deposits increased $20.9 million to $557.7 million for 2025, compared to $536.8 million for 2024. Average time deposits increased $85.0 million to $852.8 million for 2025, compared to $767.7 million for 2024. The average cost of interest-bearing deposits decreased 10 basis points to 2.32 percent for 2025, compared to 2.42 percent for 2024, due primarily to decreases in interest rates paid on time deposits, partially offset by an increase in the rates paid on savings and money market deposit accounts. A portion of the increases in average deposits was due to the wind-down of the repurchase agreement program with certain commercial deposit customers during the third quarter of 2025. Average borrowings increased $1.4 million to $120.9 million for 2025, compared to $119.5 million for 2024, due primarily to higher balances of subordinated debt, partially offset by decreases in short-term borrowings. The average cost of borrowings increased 84 basis points to 4.82 percent for 2025 compared to 3.98 percent for 2024, due primarily to higher rates paid on subordinated debt. The Corporation believes that the effects of declining market interest rates, if continued into 2026, could adversely affect its net interest margin in the short term as its assets typically reprice downward more quickly than its deposits and borrowings. The majority of the Corporation’s time deposits have repriced within the past year; however, the Corporation anticipates further declines in the cost of deposits due to the most recent decreases in market interest rates in September, October and December 2025. The Corporation also believes any such adverse impacts could be somewhat mitigated by renewals of fixed rate loans originated during periods of lower interest rates and purchases of securities available for sale with higher interest rates. The ultimate effect of market factors, including monetary policy actions taken by the Federal Reserve, on the Corporation’s net interest margin will also depend on other factors, including the Corporation’s ability to grow loans at the community banking segment and consumer finance segment, to compete for deposits, and the extent of its reliance on borrowings. The Corporation gives no assurance as to the timing or extent of changes in market interest rates or the impact of those changes or any other factor on the Corporation's ability to compete for loans and deposits or on its net interest margin. If market interest rates were to rise, net interest margin could be positively affected in the short term as the Corporation generally expects its assets to reprice upward more quickly than its deposits and borrowings. Discussion of net interest income for the year ended December 31, 2023 has been omitted as such discussion was provided in Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” under the heading “Net Interest Income” in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on February 27, 2025, and is incorporated herein by reference. 46 Table of Contents NONINTEREST INCOME TABLE 4: Noninterest Income Year Ended December 31, (Dollars in thousands) 2025 2024 2023 Gains on sales of loans $ 7,979 $ 6,064 5,780 Interchange income 6,286 6,178 $ 6,187 Service charges on deposit accounts 4,113 4,288 4,330 Wealth management services income, net 3,103 2,993 2,564 Mortgage banking fee income 2,925 2,286 2,110 Mortgage lender services income 2,850 2,049 2,048 Other service charges and fees 2,073 1,901 1,643 Unrealized gain on investments held in rabbi trust 2,585 1,319 2,301 Investment income from other equity interests 741 960 677 Other income, net 1,976 2,500 1,980 Total noninterest income $ 34,631 $ 30,538 $ 29,615 Total noninterest income increased $4.1 million, or 13.4 percent, for the year ended December 31, 2025, compared to the year ended December 31, 2024 due primarily to higher volume of mortgage loan production at the mortgage banking segment which resulted in higher gains on sales of loans and higher mortgage banking fee income, higher mortgage lender services income and higher gains on investments held in the rabbi trust, partially offset by lower investment income from other equity interests and lower other income. The Corporation uses a rabbi trust to fund liabilities under its nonqualified deferred compensation plan. Unrealized gains and losses on investments held in the Corporation’s rabbi trust are offset by changes in deferred compensation liabilities, recorded in salaries and employee benefits expense. Discussion of noninterest income for the year ended December 31, 2023 has been omitted as such discussion was provided in Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” under the heading “Noninterest Income” in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on February 27, 2025, and is incorporated herein by reference. 47 Table of Contents NONINTEREST EXPENSE TABLE 5: Noninterest Expense Year Ended December 31, (Dollars in thousands) 2025 2024 2023 Salaries and employee benefits: Compensation, payroll taxes and employee benefits $ 54,191 $ 52,259 $ 52,575 Increase in nonqualified deferred compensation plan liabilities 2,585 1,319 2,301 Total salaries and employee benefits 56,776 53,578 54,876 Occupancy expense 8,802 8,397 7,993 Data processing 11,962 11,314 10,874 Professional fees 3,699 3,611 2,752 Insurance expense 1,721 1,832 1,659 Marketing and advertising expenses 2,363 1,213 1,548 Loan processing and collection expenses 3,137 2,661 3,317 Other expenses: Telecommunication expenses 1,298 1,529 1,330 Licenses and taxes expense 1,191 1,004 918 Travel and educational expenses 1,291 994 1,272 Postage and courier expenses 1,091 1,049 994 Other real estate owned losses and expense, net — 218 — Other components of net periodic pension cost (601) (532) (452) Provision for indemnifications (190) (460) (585) All other noninterest expenses 3,680 3,522 3,387 Total other noninterest expenses 7,760 7,324 6,864 Total noninterest expense $ 96,220 $ 89,930 $ 89,883 Total noninterest expense increased $6.3 million, or 7.0 percent, for the year ended December 31, 2025, compared to the year ended December 31, 2024 due primarily to higher salaries and employee benefits due to higher commissions from increased volume of mortgage loan production, increased employee incentive accruals associated with improved financial performance and the addition of a seasoned lending team with the expansion into Southwest Virginia, fluctuations in deferred compensation liabilities, higher marketing and advertising expenses related to the Corporation’s strategic marketing initiative and higher data processing expenses related to investments in operational technology, partially offset by lower telecommunications expense and lower other real estate owned losses. Changes in deferred compensation liabilities are related to the Corporation’s nonqualified plan which are offset by unrealized gains and losses on investments held in the Corporation’s rabbi trust, and are recorded in noninterest income. Discussion of noninterest expense for the year ended December 31, 2023 has been omitted as such discussion was provided in Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” under the heading “Noninterest Expense” in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on February 27, 2025, and is incorporated herein by reference. INCOME TAXES Income tax expense on 2025 earnings was $6.1 million, resulting in an effective tax rate of 18.4 percent, compared with $4.2 million, or 17.5 percent, in 2024. The Corporation’s consolidated effective tax rate for the year ended December 31, 2025 was higher compared to the year ended December 31, 2024 due primarily to lower tax benefits of tax-exempt income as a percentage of pre-tax income and higher state income taxes. 48 Table of Contents Discussion of income taxes for the year ended December 31, 2023 has been omitted as such discussion was provided in Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” under the heading “Income Taxes” in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on February 27, 2025 and is incorporated herein by reference. BUSINESS SEGMENTS The Corporation operates in a decentralized manner in three business segments: community banking, mortgage banking and consumer finance. An overview of the financial results for each of the Corporation’s business segments is presented below. Community Banking: The community banking segment comprises C&F Bank, C&F Wealth Management, C&F Insurance and CVB Title. The following table presents the community banking segment operating results for the periods indicated. TABLE 6: Community Banking Segment Operating Results Year Ended December 31, (Dollars in thousands) 2025 2024 2023 Interest income $ 99,355 $ 87,600 $ 74,949 Interest expense 41,716 40,498 24,184 Net interest income before allocation 57,639 47,102 50,765 Net interest allocation1 24,058 24,456 23,438 Net interest income 81,697 71,558 74,203 Provision for credit losses (50) 1,650 1,625 Net interest income after provision for credit losses 81,747 69,908 72,578 Noninterest income: Interchange income 6,286 6,178 6,187 Service charges on deposit accounts 4,173 4,354 4,390 Wealth management services income, net 3,103 2,993 2,564 Other service charges and fees 2,071 1,899 1,640 Investment income from other equity interests 741 960 677 Other income, net 1,143 1,339 1,007 Total noninterest income 17,517 17,723 16,465 Noninterest expense: Salaries and employee benefits 37,640 36,252 36,005 Occupancy expense 7,266 6,887 6,353 Data processing 9,432 8,927 8,564 Professional fees 2,681 2,834 2,149 Insurance expense 1,476 1,575 1,396 Marketing and advertising expenses 1,784 748 1,075 Loan processing and collection expenses 174 256 248 Other expenses 5,292 5,395 5,023 Total noninterest expenses 65,745 62,874 60,813 Income before income taxes 33,519 24,757 28,230 Income tax expense 6,288 4,473 5,302 Net income $ 27,231 $ 20,284 $ 22,928 1 Interest expense is allocated to the mortgage banking and consumer finance segments through borrowings from the community banking segment. 49 Table of Contents Net income for the community banking segment was $27.2 million for the year ended December 31, 2025, compared to $20.3 million for the year ended December 31, 2024 due primarily to: ● higher interest income resulting from higher average balances of loans and cash reserves and higher average interest rates on securities; and ● lower provision for credit losses due to the resolution of a nonperforming commercial real estate loan in the second quarter of 2025 that had carried a specific reserve and a decrease in the pace of growth in loans; partially offset by: ● higher interest expense due primarily to higher average balances of interest-bearing deposits, partially offset by lower average rates on deposits; ● higher salaries and employee benefits due primarily to increased employee incentive accruals associated with improved financial performance and the addition of a seasoned lending team with the expansion into Southwest Virginia in the third quarter of 2025; and ● higher marketing and advertising expenses related to the Corporation’s strategic marketing initiative, which began in the second half of 2024. Net interest income for the community banking segment increased $10.1 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 due primarily to an increase in net interest margin and higher average balances of earning assets. Interest income allocated to the community banking segment includes interest income on loans to the consumer finance and mortgage banking segments. These transactions are eliminated to reach consolidated totals. Community banking segment loans, excluding loans to the consumer finance and mortgage banking segments, increased $136.7 million, or 9.4 percent, to $1.6 billion at December 31, 2025, compared to $1.5 billion at December 31, 2024, due primarily to growth in the commercial real estate, land acquisition and development and equity lines segments of the loan portfolio. Deposits increased $174.9 million, or 8.1 percent, to $2.3 billion at December 31, 2025, compared to $2.2 billion at December 31, 2024. The community banking segment recorded a net reversal of provision for credit losses of $50,000 for the year ended December 31, 2025, compared to a provision for credit losses of $1.7 million for the year ended December 31, 2024. The allowance for credit losses as a percentage of total loans decreased to 1.10 percent at December 31, 2025 from 1.20 percent at December 31, 2024. This decrease is due primarily to the resolution of a nonperforming commercial real estate loan that had carried a specific reserve and growth in loans with shorter expected lives, which resulted in lower estimated losses over the life of the loan, partially offset by growth in the loan portfolio. Management believes that the level of the allowance for credit losses is adequate to reflect the net amount expected to be collected. Discussion of the community banking segment for the year ended December 31, 2023 has been omitted as such discussion was provided in Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” under the heading “Business Segments” in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on February 27, 2025, and is incorporated herein by reference. 50 Table of Contents Mortgage Banking: The following table presents the mortgage banking operating results for the periods indicated. TABLE 7: Mortgage Banking Segment Operating Results Year Ended December 31, (Dollars in thousands) 2025 2024 2023 Interest income $ 2,336 $ 1,897 $ 1,695 Interest expense — — — Net interest income before allocation 2,336 1,897 1,695 Net interest allocation1 (1,027) (796) (612) Net interest income 1,309 1,101 1,083 Provision for credit losses — — — Net interest income after provision for credit losses 1,309 1,101 1,083 Noninterest income: Gains of sales of loans 8,568 6,421 5,845 Mortgage banking fee income 3,080 2,458 2,254 Mortgage lender services fee income 2,857 2,059 2,048 Other income 13 85 51 Total noninterest income 14,518 11,023 10,198 Noninterest expense: Salaries and employee benefits 7,903 7,069 6,996 Occupancy expense 958 890 1,005 Data processing 1,233 1,012 1,008 Professional fees 172 103 101 Insurance expense 101 111 128 Marketing and advertising expenses 546 426 428 Loan processing and collection expenses 1,214 917 1,047 Provision for indemnifications (190) (460) (585) Other expenses 803 528 560 Total noninterest expenses 12,740 10,596 10,688 Income before income taxes 3,087 1,528 593 Income tax expense 780 420 128 Net income $ 2,307 $ 1,108 $ 465 1 Interest expense is allocated to the mortgage banking segment through borrowings from the community banking segment. The mortgage banking segment reported net income of $2.3 million for the year ended December 31, 2025, compared to $1.1 million for the year ended December 31, 2024, due primarily to: ● higher gains on sales of loans and higher mortgage banking fee income due to higher volume of mortgage loan originations; and ● higher mortgage lender services income; partially offset by: ● higher variable expenses tied to mortgage loan origination volume such as commissions and bonuses, reported in salaries and employee benefits, as well as loan processing and data processing expenses; and ● lower reversal of provision for indemnifications. 51 Table of Contents The following table presents mortgage loan originations and mortgage loans sold for the periods indicated. TABLE 8: Mortgage Loan Originations Year Ended December 31, (Dollars in thousands) 2025 2024 2023 Mortgage loan originations: Purchases $ 596,127 $ 477,550 $ 446,071 Refinancings 84,120 50,200 52,726 Total mortgage loan originations1 $ 680,247 $ 527,750 $ 498,797 Lock-adjusted originations2 $ 684,957 $ 539,312 484,602 1 Total mortgage loan originations does not include mortgage lender services. 2 Lock-adjusted originations includes the effect of changes in the volume of mortgage loan applications in process that have not closed, net of an estimated volume not expected to close. Despite the sustained elevated level of mortgage interest rates, higher home prices and low levels of inventory, mortgage banking segment loan originations increased 28.9 percent for the year ended December 31, 2025, compared to the year ended December 31, 2024. Gains on sales of loans, while driven in part by mortgage loan originations, also includes the effects of changes in locked loan commitments, which reflect the volume of mortgage loan applications that are in process and have not closed. Lock-adjusted originations for the mortgage banking segment increased by 27.0 percent for the year ended December 31, 2025 compared to the year ended December 31, 2024. Locked loan commitments increased by $5.3 million in the year ended December 31, 2025 and increased by $13.1 million in the year ended December 31, 2024. Locked loan commitments were $44.6 million at December 31, 2025, compared to $39.3 million at December 31, 2024 and $26.2 million at December 31, 2023. Mortgage loan segment originations include originations of loans sold to the community banking segment, at prices similar to those paid by third-party investors. All interest expense allocated to the mortgage banking segment is from interest expense on borrowings from the community banking segment. These transactions are eliminated to reach consolidated totals. Through the Lender Solutions division of the mortgage banking segment, mortgage lender services fee income is derived from providing mortgage origination functions to third-party mortgage lenders for a fee. Mortgage lender services fee income increased for the year ended December 31, 2025 compared to the year ended December 31, 2024, due primarily to increased mortgage loan volume in the industry, an increase in fees and types of services provided, and an increase in the number of third-party mortgage lenders serviced. The mortgage banking segment recorded a net reversal of provision for indemnification losses of $190,000 for the year ended December 31, 2025 compared to a net reversal of provision for indemnification losses of $460,000 for the year ended December 31, 2024. The release of indemnification reserves in 2025 and 2024 was due primarily to lower volume of mortgage loan originations in recent years, improvement in the mortgage banking segment’s assessment of borrower payment performance and other factors affecting expected losses on mortgage loans sold in the secondary market, such as time since origination. The net releases in 2025 decreased compared to 2024 due primarily to the increased mortgage loan originations in 2025 compared to 2024. Management believes that the indemnification reserve is sufficient to absorb losses related to loans that have been sold in the secondary market. Discussion of the mortgage banking segment for the year ended December 31, 2023 has been omitted as such discussion was provided in Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” under the heading “Business Segments” in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on February 27, 2025, and is incorporated herein by reference. 52 Table of Contents Consumer Finance: The following table presents the consumer finance operating results for the periods indicated. TABLE 9: Consumer Finance Segment Operating Results Year Ended December 31, (Dollars in thousands) 2025 2024 2023 Interest income $ 49,178 $ 49,684 $ 47,264 Interest expense — — — Net interest income before allocation 49,178 49,684 47,264 Net interest allocation1 (23,031) (23,660) (22,826) Net interest income 26,147 26,024 24,438 Provision for credit losses 11,600 11,600 6,650 Net interest income after provision for credit losses 14,547 14,424 17,788 Noninterest income 764 1,024 962 Noninterest expense: Salaries and employee benefits 7,753 8,026 8,733 Occupancy expense 578 620 634 Data processing 1,257 1,328 1,280 Professional fees 570 312 310 Insurance expense 144 146 135 Marketing and advertising expenses 33 39 45 Loan processing and collection expenses 1,749 1,488 2,022 Other expenses 1,576 1,577 1,657 Total noninterest expenses 13,660 13,536 14,816 Income before income taxes 1,651 1,912 3,934 Income tax expense 422 498 1,055 Net income $ 1,229 $ 1,414 $ 2,879 1 Interest expense is allocated to the consumer finance segment through borrowings from the community banking segment. The consumer finance segment reported net income of $1.2 million for the year ended December 31, 2025, compared to $1.4 million for the year ended December 31, 2024, due primarily to: ● lower interest income resulting from lower average balances of loans, partially offset by higher loan yields; and ● higher loan processing and collection expenses; partially offset by: ● lower interest expense allocation on borrowings from the community banking segment as a result of lower average balances of borrowings; and ● lower salaries and employee benefits expense due to efforts to reduce overhead costs. All interest expense allocated to the consumer finance segment is from interest expense on borrowings from the community banking segment. These transactions are eliminated to reach consolidated totals. The consumer finance segment recorded provision for credit losses of $11.6 million for each of the years ended December 31, 2025 and 2024. The allowance for credit losses as a percentage of total loans was 4.79 percent at December 31, 2025 compared to 4.86 percent at December 31, 2024. Management believes that the level of the allowance for credit losses is adequate to reflect the net amount expected to be collected. If loan performance deteriorates resulting in further elevated delinquencies or net charge-offs, the provision for credit losses may increase in future periods. Discussion of the consumer finance segment for the year ended December 31, 2023 has been omitted as such discussion was provided in Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of 53 Table of Contents Operations,” under the heading “Business Segments” in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on February 27, 2025, and is incorporated herein by reference. ASSET QUALITY Allowance and Provision for Credit Losses The Corporation conducts an analysis of the collectability of the loan portfolio on a regular basis and uses this analysis to assess the sufficiency of the allowance for credit losses on loans and to determine the necessary provision for credit losses. The Corporation segments the loan portfolio into three loan portfolios based on common risk characteristics. The allowance for credit losses represents management’s current estimate of expected credit losses over the contractual term of loans held for investment, and is recorded at an amount that, in management’s judgment, reduces the recorded investment in loans to the net amount expected to be collected. Management’s judgment in determining the level of the allowance is based on evaluations of historical loan losses, current conditions and reasonable and supportable forecasts relevant to the collectability of loans. Loans that share common risk characteristics are evaluated collectively using a discounted cash flow approach for all loans except for overdraft balances, which are evaluated using a loss rate approach. The discounted cash flow approach used by the Corporation utilizes loan-level cash flow projections and pool-level assumptions. For commercial (except for loans to states and political subdivisions) and consumer loans, cash flow projections and estimated expected losses are based in part on forecasts of the national unemployment rate that are reasonable and supportable and external observations of historical loan losses. Forecasts of the national unemployment rate are derived from the Federal Open Markets Committee of the Federal Reserve Board. For periods beyond those for which reasonable and supportable forecasts are available, projections are based on a reversion of the national unemployment rate from the last forecast to a historical average level over the following six months. Cash flow projections and estimated expected losses for loans to states and political subdivisions are based on external loss observations for state and municipal debt obligations. For consumer finance loans, cash flow projections and estimated expected losses reflect historical average loss experience based on internal observations for automobile loans and based on external loss observations for marine and RV loans. Management’s estimate of the allowance for credit losses on loans that are collectively evaluated also includes a qualitative assessment of available information relevant to assessing collectability that is not captured in the loss estimation process. Factors considered by management include changes and expected changes in general market, economic and business conditions; the nature and volume of the loan portfolio; the volume and severity of delinquencies and adversely classified loan balances and the value of underlying collateral. This evaluation is inherently subjective, as it requires estimates that are susceptible to significant revision as more information becomes available. The evaluation also considers the following risk characteristics that are inherent in the loan portfolio: ● Commercial loans are comprised of mortgage loans on commercial real estate, real estate acquisition, development and constructions loans, and other business lending, and carry risks associated with the successful operation of a business or a real estate project and changes in the value of collateral. In addition to other risks associated with the ownership of real estate, the repayment of these loans may be dependent upon the profitability and cash flows of the business or project. Construction loans, which include loans to individuals for the construction of a residence that generally will be occupied by the borrower, also bear the risk that the general contractor, who may or may not be a loan customer, may be unable to finish the construction project as planned because of financial pressure unrelated to the project. In addition, there is risk associated with the value of collateral other than real estate which may depreciate over time and cannot be appraised with as much precision. ● Consumer loans are comprised primarily of residential mortgage loans and home equity lines secured by residential real estate and carry risks associated with the continued credit-worthiness of the borrower and changes in the value of the collateral. 54 Table of Contents ● Consumer finance loans are comprised of indirect financing for purchases of automobiles and marine and RVs and carry risks associated with the continued credit-worthiness of the borrower and changes in the value of the collateral, which are typically rapidly-depreciating vehicles. Consumer finance loans are more likely than real estate loans to be immediately adversely affected by job loss, divorce, illness or personal bankruptcy. Allowance for Credit Losses Methodology – Commercial and Consumer. The review process generally begins with management assigning loan ratings to individual loans and identifying problem loans to be reviewed on an individual basis. This review of individual loans is limited to those loans that have specific risk characteristics not shared by other loans or that may result in significant losses to the Corporation, while all other loans, which may include delinquent loans and loans classified as special mention or substandard, are evaluated collectively in pools that share common risk characteristics. The allowance for loans that are individually evaluated may be estimated based on their expected cash flows, or, in the case of loans for which repayment is expected substantially through the operation or sale of collateral when the borrower is experiencing financial difficulty, may be measured based on the fair value of the collateral less estimated costs to sell. For these collateral dependent loans, we obtain an updated appraisal if we do not have a current one on file. Appraisals are performed by independent third party appraisers with relevant industry experience. We may make adjustments to the appraised value based on recent sales of similar properties or general market conditions when appropriate. Commercial and consumer loans are assigned loan classification ratings based on their credit quality and risk of loss. These loan ratings are reviewed on a quarterly basis and updated as new information becomes available. The characteristics of these loan ratings are as follows: ● Pass rated loans are to persons or business entities with an acceptable financial condition, appropriate collateral margins, appropriate cash flow to service the existing loan, and an appropriate leverage ratio. The borrower has paid all obligations as agreed and it is expected that this type of payment history will continue. When necessary, acceptable personal guarantors support the loan. ● Special mention loans have a specific, identified weakness in the borrower’s operations and in the borrower’s ability to generate positive cash flow on a sustained basis. The borrower’s recent payment history may be characterized by late payments. The Corporation’s risk exposure is mitigated by collateral supporting the loan. The collateral is considered to be well-margined, well maintained, accessible and readily marketable. ● Substandard loans are considered to have specific and well-defined weaknesses that jeopardize the viability of the Corporation’s credit extension. The payment history for the loan has been inconsistent and the expected or projected primary repayment source may be inadequate to service the loan. The estimated net liquidation value of the collateral pledged and/or ability of the personal guarantor(s) to pay the loan may not adequately protect the Corporation. There is a distinct possibility that the Corporation will sustain some loss if the deficiencies associated with the loan are not corrected in the near term. ● Substandard nonaccrual loans have the same characteristics as substandard loans; however, they have a nonaccrual classification because it is probable that the Corporation will not be able to collect all amounts due. ● Doubtful rated loans have all the weaknesses inherent in a loan that is classified substandard but with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. The possibility of loss is extremely high. ● Loss rated loans are not considered collectible under normal circumstances and there is no realistic expectation for any future payment on the loan. Loss rated loans are fully charged off. Allowance for Credit Losses Methodology – Consumer Finance. Cash flow projections and estimated expected losses reflect historical average loss experience based on internal observations for auto loans and based on external loss observations for marine and RV loans. Automobile loans are evaluated in pools of loans that share the same internal credit rating based on borrowers’ credit scores at origination. The Corporation utilizes credit scores based on the methods developed and defined by the Fair Isaac Corporation (FICO) as a key indicator of the risk of loss to manage the portfolio 55 Table of Contents and estimate the allowance for credit losses. A FICO Score is a three-digit number based on the information in an applicant’s credit reports. It helps lenders determine how likely an applicant is to repay a loan. This, in turn, affects the loan amount that may be approved, repayment terms, and interest rate. The Corporation obtains FICO Scores in the credit reports provided by the car dealers that accept the consumer auto loan application, which may have been generated by any of the three major credit reporting bureaus, and also independently obtains a credit report on the borrower directly from Experian or Transunion. The Corporation utilizes an industry-specific FICO Score which is optimized for automobile credit products. Consumer finance loans are assigned a credit rating based on borrowers’ credit scores at the time of origination and are categorized within ranges of credit ratings used internally that parallel FICO Score rating bands. The Corporation monitors the consumer finance loan portfolio by past due status and by credit rating at the time of origination, which the Corporation believes serves as a relevant indicator of aggregate credit quality and risk of loan defaults in the portfolio based upon the use of FICO Scores over time for loan approval decisions and through experience analyzing loss patterns. The characteristics of these credit ratings and our thresholds are as follows: ● Very Good (739) and Good (670-739) credit rated borrowers are near or above the average FICO Score of consumers. Borrowers generally have limited to no prior credit difficulties or have shown extensive creditworthiness over a recent period of time. ● Fairly Good (625-669) and Fair (580-624) credit rated borrowers are approaching or slightly below the average FICO Score of consumers but typically have a credit profile acceptable to most lenders. Borrowers may have experienced minor credit difficulties or have a relatively limited credit history. ● Marginal (580) credit rated borrowers are well below the average FICO Score of consumers. Borrowers may have limited access to traditional financing due to having experienced prior credit difficulties or have a limited credit history. The risk of future charge-offs is higher. In accordance with its policies and guidelines and consistent with industry practices, the consumer finance segment, at times, offers payment deferrals, whereby the borrower is allowed to move up to two payments within a twelve-month rolling period to the end of the loan. A fee will be collected for extensions only in states that permit it. An account for which all delinquent payments are deferred is classified as current at the time the deferment is granted and therefore is not included as a delinquent account. Thereafter, such an account is aged based on the timely payment of future installments in the same manner as any other account. We evaluate the results of this deferment strategy based upon the amount of cash installments that are collected on accounts after they have been deferred versus the extent to which the collateral underlying the deferred accounts has depreciated over the same period of time. Based on this evaluation, we believe that payment deferrals granted according to our policies and guidelines are an effective portfolio management technique and result in higher ultimate cash collections. Payment deferrals may affect the ultimate timing of when an account is charged off. Increased use of deferrals may result in a lengthening of the loss confirmation period, which would increase expectations of credit losses inherent in the portfolio and therefore increase the allowance for credit losses and related provision for credit losses. The allowance for credit losses represents an amount that, in our judgment, reduces the recorded investment in loans to the net amount expected to be collected. The provision for credit losses increases the allowance, and loans charged off, net of recoveries, reduce the allowance. The following tables present the Corporation’s credit loss experience for the periods indicated. 56 Table of Contents TABLE 10: Allowance for Credit Losses Consumer (Dollars in thousands) Commercial Consumer1 Finance Total For the year ended December 31, 2025: Balance at December 31, 2024 $ 13,347 $ 4,032 $ 22,708 $ 40,087 Provision charged to operations (128) 278 11,600 11,750 Loans charged off (35) (273) (16,581) (16,889) Recoveries of loans previously charged off 55 142 4,532 4,729 Balance at December 31, 2025 $ 13,239 $ 4,179 $ 22,259 $ 39,677 Average loans2 $ 1,129,149 $ 387,364 $ 464,443 $ 1,980,956 Ratio of net (recoveries) charge-offs to average loans (0.00) % 0.03 % 2.59 % 0.61 % Consumer (Dollars in thousands) Commercial Consumer1 Finance Total For the year ended December 31, 2024: Balance at December 31, 2023 $ 12,315 $ 3,758 $ 23,578 $ 39,651 Provision charged to operations 1,058 442 11,600 13,100 Loans charged off (63) (377) (16,723) (17,163) Recoveries of loans previously charged off 37 209 4,253 4,499 Balance at December 31, 2024 $ 13,347 $ 4,032 $ 22,708 $ 40,087 Average loans2 $ 1,010,121 $ 371,375 $ 476,775 $ 1,858,271 Ratio of net charge-offs to average loans 0.00 % 0.05 % 2.62 % 0.68 % Consumer (Dollars in thousands) Commercial Consumer1 Finance Total For the year ended December 31, 2023: Balance at December 31, 2022 $ 11,219 $ 3,330 $ 25,969 $ 40,518 Impact of ASC 326 adoption on non-PCD loans (617) 98 406 (113) Impact of ASC 326 adoption on PCD loans 595 9 — 604 Provision charged to operations 978 498 6,650 8,126 Loans charged off (16) (356) (13,743) (14,115) Recoveries of loans previously charged off 156 179 4,296 4,631 Balance at December 31, 2023 $ 12,315 $ 3,758 $ 23,578 $ 39,651 Average loans2 $ 879,608 $ 336,727 $ 473,885 $ 1,690,220 Ratio of net (recoveries) charge-offs to average loans (0.02) % 0.05 % 1.99 % 0.56 % 1Consumer loans includes provision, charge-offs and recoveries related to demand deposit overdrafts. 2 Average loans does not include loans held for sale at the mortgage banking segment. For further information regarding the adequacy of our allowance for credit losses, refer to “Nonperforming Assets” and the accompanying disclosure below within this Item 7. 57 Table of Contents The allocation of the allowance for credit losses and the ratio of corresponding outstanding loan balances to total loans are as follows as of the dates indicated. TABLE 11: Allocation of Allowance for Credit Losses December 31, December 31, (Dollars in thousands) 2025 2024 Allocation of allowance for credit losses: Commercial $ 13,239 $ 13,347 Consumer 4,179 4,032 Consumer Finance 22,259 22,708 Total allowance for credit losses $ 39,677 $ 40,087 Ratio of loans to total period-end loans: Commercial 57 % 55 % Consumer 20 20 Consumer Finance 23 25 100 % 100 % Loans are required to be measured at amortized cost and to be presented at the net amount expected to be collected. Credit losses on available for sale debt securities are accounted for as an allowance for credit losses, which is a valuation account that is deducted from the amortized cost basis of the financial asset to present the net carrying value and the amount expected to be collected on the financial asset. The Corporation concluded that a credit loss did not exist in its securities portfolio at December 31, 2025, and no allowance for credit losses has been recognized. Off balance sheet credit exposures, including loan commitments, are not recorded on balance sheet, but expected credit losses arising from off balance sheet credit exposures are recorded as a reserve for unfunded commitments and reported in Other Liabilities. The following table presents the Corporation’s reserve for unfunded commitments for the periods indicated. TABLE 12: Reserve for Unfunded Commitments Year Ended December 31, (Dollars in thousands) 2025 2024 Balance at the beginning of period $ 1,800 $ 1,650 Provision charged to operations (200) 150 Total $ 1,600 $ 1,800 The allowance for credit losses on loans and available for sale debt securities and the reserve for unfunded commitments are established through a provision for credit losses charged against earnings. The following table presents a breakdown of the provision for credit losses for the periods indicated: TABLE 13: Provision for Credit Losses Year Ended December 31, (Dollars in thousands) 2025 2024 2023 Provision for credit losses: Provision for loans $ 11,750 $ 13,100 $ 8,126 Provision for unfunded commitments (200) 150 149 Total $ 11,550 $ 13,250 $ 8,275 58 Table of Contents TABLE 14: Credit Quality Indicators Loans by credit quality indicators as of December 31, 2025 were as follows: Special Substandard (Dollars in thousands) Pass Mention Substandard Nonaccrual Total1 Commercial real estate $ 835,360 $ 72 $ — $ — $ 835,432 Commercial business 115,710 — — — 115,710 Construction - commercial real estate 99,604 — — — 99,604 Land acquisition and development 66,248 — — — 66,248 Builder lines 37,938 — — — 37,938 Construction - consumer real estate 29,288 — — — 29,288 Residential mortgage 317,686 655 60 1,135 319,536 Equity lines 76,359 101 — — 76,460 Other consumer 10,085 — — — 10,085 $ 1,588,278 $ 828 $ 60 $ 1,135 $ 1,590,301 (Dollars in thousands) Very Good Good Fairly Good Fair Marginal Total Consumer finance - automobiles $ 49,347 $ 114,539 $ 135,569 $ 86,336 $ 20,521 $ 406,312 Consumer finance - marine and recreational vehicles 38,531 19,023 409 — — 57,963 $ 87,878 $ 133,562 $ 135,978 $ 86,336 $ 20,521 $ 464,275 1 At December 31, 2025, the Corporation did not have any loans classified as Doubtful or Loss. Loans by credit quality indicators as of December 31, 2024 were as follows: Special Substandard (Dollars in thousands) Pass Mention Substandard Nonaccrual Total1 Commercial real estate $ 733,242 $ 940 $ — $ — $ 734,182 Commercial business 104,947 — — — 104,947 Construction - commercial real estate 132,717 — — — 132,717 Land acquisition and development 46,072 — — — 46,072 Builder lines 35,605 — — — 35,605 Construction - consumer real estate 18,799 — — — 18,799 Residential mortgage 306,877 1,427 172 333 308,809 Equity lines 62,042 76 86 — 62,204 Other consumer 10,270 — — — 10,270 $ 1,450,571 $ 2,443 $ 258 $ 333 $ 1,453,605 (Dollars in thousands) Very Good Good Fairly Good Fair Marginal Total Consumer finance - automobiles $ 43,033 $ 106,791 $ 135,175 $ 90,581 $ 23,071 $ 398,651 Consumer finance - marine and recreational vehicles 46,761 20,902 479 — — 68,142 $ 89,794 $ 127,693 $ 135,654 $ 90,581 $ 23,071 $ 466,793 1 At December 31, 2024, the Corporation did not have any loans classified as Doubtful or Loss. 59 Table of Contents Nonperforming Assets A loan’s past due status is based on the contractual due date of the most delinquent payment due. Loans are generally placed on nonaccrual status when the collection of principal or interest is 90 days or more past due, or earlier, if collection is uncertain based on an evaluation of the net realizable value of the collateral and the financial strength of the borrower. Any accrued interest receivable on loans placed on nonaccrual status is reversed by an adjustment to interest income. Loans greater than 90 days past due may remain on accrual status if management determines it has adequate collateral to cover the principal and interest. For those loans that are carried on nonaccrual status, payments are first applied to principal outstanding. A loan may be returned to accrual status if the borrower has demonstrated a sustained period of repayment performance in accordance with the contractual terms of the loan and there is reasonable assurance the borrower will continue to make payments as agreed. These policies are applied consistently across our loan portfolio. Assets acquired through, or in lieu of, foreclosure are held for sale and are initially recorded at fair value less estimated costs to sell at the date of foreclosure. Initial fair value is based upon appraisals the Corporation obtains from independent licensed appraisers. Subsequent to foreclosure, management periodically performs valuations of the foreclosed assets based on updated appraisals, general market conditions, recent sales of similar properties, length of time the properties have been held, and our ability and intent with regard to continued ownership of the properties. We may incur additional write-downs of foreclosed assets to fair value less estimated costs to sell if valuations indicate a further deterioration in market conditions. Revenue and expenses from operations and changes in the property valuations are included in net expenses from foreclosed assets and improvements are capitalized. At the consumer finance segment, the repossession process is generally initiated after a loan becomes more than 60 days delinquent. Borrowers have an opportunity to redeem their repossessed vehicles by paying all outstanding balances, including finance charges and fees. Vehicles that are not redeemed within the prescribed waiting period before the Corporation has the legal right to sell the repossessed vehicle then become available-for-sale at the end of that period and are reclassified from loans to other assets and are recorded initially at fair value less estimated costs to sell. The difference between the carrying amount of each loan and the fair value of the vehicle (i.e. the deficiency) is charged against the allowance for credit losses. Accounts still in process of collection or for which the Corporation does not have the legal right to sell continue to be classified as loans until such legal authority is obtained. After the vehicles have been sold in third-party auctions, we credit the proceeds from the sale of the vehicles, and any other recoveries, to the carrying value of the repossessed vehicles. The Corporation pursues collection of deficiencies, as allowed by state law, when it deems such action to be appropriate. Table 15 summarizes the Corporation’s credit ratios on a consolidated basis and Table 16 summarizes nonperforming assets by principal business segment as of December 31, 2025 and 2024. The mortgage banking segment did not have any nonperforming assets as December 31, 2025 or 2024. TABLE 15: Consolidated Credit Ratios December 31, (Dollars in thousands) 2025 2024 Total loans1 $ 2,054,576 $ 1,920,398 Nonaccrual loans $ 2,157 $ 947 Allowance for credit losses (ACL) $ 39,677 $ 40,087 Nonaccrual loans to total loans 0.10 % 0.05 % ACL to total loans 1.93 % 2.09 % ACL to nonaccrual loans 1,839.45 % 4,233.05 % 1 Total loans does not include loans held for sale at the mortgage banking segment. 60 Table of Contents TABLE 16: Nonperforming Assets Community Banking Segment December 31, (Dollars in thousands) 2025 2024 Total loans $ 1,590,301 $ 1,453,605 Nonaccrual loans $ 1,135 $ 333 ACL $ 17,418 $ 17,379 Nonaccrual loans to total loans 0.07 % 0.02 % ACL to total loans 1.10 % 1.20 % ACL to nonaccrual loans 1,534.63 % 5,218.92 % Net charge-offs to average total loans 0.01 % 0.01 % Consumer Finance Segment December 31, (Dollars in thousands) 2025 2024 Total loans $ 464,275 $ 466,793 Nonaccrual loans $ 1,022 $ 614 Repossessed assets $ 937 $ 779 ACL $ 22,259 $ 22,708 Nonaccrual loans to total loans 0.22 % 0.13 % ACL to total loans 4.79 % 4.86 % ACL to nonaccrual loans 2,177.98 % 3,698.37 % Net charge-offs to average total loans 2.59 % 2.62 % The following table presents the changes in the OREO balance for the years ended December 31, 2025 and 2024. TABLE 17: OREO Changes Year Ended December 31, (Dollars in thousands) 2025 2024 Balance at the beginning of year, gross $ 1,531 $ — Additions — — Transfers from bank premises — 1,827 Charge-offs — — Sales proceeds — (416) Gain on disposition — 120 Balance at the end of year, gross 1,531 1,531 Less valuation allowance (215) (215) Balance at the end of year, net $ 1,316 $ 1,316 The community banking segment’s nonaccrual loans were $1.1 million at December 31, 2025 compared to $333,000 at December 31, 2024. The increase in nonaccrual loans compared to December 31, 2024 is due primarily to the downgrade of one residential mortgage relationship in the first quarter of 2025. If interest on loans on nonaccrual at December 31, 2025 had been recognized throughout the year, the community banking segment would have recorded additional gross interest income in 2025 of $76,000. OREO activity for the year ended December 31, 2024 related to properties previously used by the Bank as branches, which were consolidated into nearby branches. The community banking segment recorded $50,000 in net reversals in provision for credit losses for the year ended December 31, 2025, compared to $1.7 million for the year ended December 31, 2024. At both December 31, 2025 and 2024, the allowance for credit losses was $17.4 million. At December 31, 2025, the allowance for credit losses decreased to 1.10 percent of total 61 Table of Contents loans, compared to 1.20 percent at December 31, 2024, due primarily to the resolution of a nonperforming commercial real estate loan that had carried a specific reserve and growth in loans with shorter expected lives, which resulted in lower estimated losses over the life of the loan, partially offset by growth in the loan portfolio. Management believes that the level of the allowance for credit losses is adequate to reflect the net amount expected to be collected. Nonaccrual loans at the consumer finance segment increased to $1.0 million at December 31, 2025 from $614,000 at December 31, 2024. Nonaccrual consumer finance loans remain low relative to the allowance for credit losses and the total consumer finance loan portfolio because the consumer finance segment generally initiates repossession of loan collateral once a loan becomes more than 60 days delinquent. Repossessed vehicles of the consumer finance segment are classified as other assets and consist only of vehicles the Corporation has the legal right to sell. Prior to the reclassification from loans to repossessed vehicles, the difference between the carrying amount of each loan and the fair value of each vehicle (i.e. the deficiency) is charged against the allowance for credit losses. At December 31, 2025, repossessed vehicles at fair value less estimated costs to sell included in other assets totaled $937,000, compared to $779,000 at December 31, 2024. If interest on loans on nonaccrual at December 31, 2025 had been recognized throughout the year, the consumer finance segment would have recorded additional gross interest income in 2025 of $8,000. The consumer finance segment experienced net charge-offs at a rate of 2.59 percent of average total loans for the year ended December 31, 2025, compared to 2.62 percent for the year ended December 31, 2024. At December 31, 2025, total delinquent loans as a percentage of total loans was 4.38 percent, compared to 3.90 percent at December 31, 2024. The allowance for credit losses was $22.3 million at December 31, 2025, compared to $22.7 million at December 31, 2024. The allowance for credit losses as a percentage of total loans decreased to 4.79 percent at December 31, 2025, compared to 4.86 percent at December 31, 2024 due primarily to changes in qualitative model adjustments primarily related to the relative stabilization of collateral values during 2025. Management believes that the level of the allowance for credit losses is adequate to reflect the net amount expected to be collected. As previously described, the consumer finance segment, at times, offers payment deferrals as a portfolio management technique to achieve higher ultimate cash collections on select loan accounts. Payment deferrals may affect the ultimate timing of when an account is charged off. A significant reliance on deferrals as a means of managing collections may result in a lengthening of the loss confirmation period, which would increase expectations of credit losses inherent in the portfolio. The average amounts deferred of automobile loans on a monthly basis, which are not included in delinquent loans, during 2025 were 1.97 percent of average automobile loans outstanding, compared to 1.80 percent during 2024 and 1.87 percent during 2023. The consumer finance segment is an indirect lender that provides automobile financing through lending programs that are designed to serve customers in both the prime and “non-prime” markets, including those who may have limited access to traditional automobile financing due to having experienced prior credit difficulties. The preferred automobile is a later model, low mileage used vehicle because the value of new vehicles typically depreciates rapidly. In addition to automobile financing, marine and RV loan contracts were also purchased on an indirect basis through a referral program administered by a third party. The marine and RV loan contracts were for prime loans averaging less than $50,000 made to individuals with higher credit scores. The third party administrator of that program significantly decreased sales of those loans to outside parties during 2025, which led to the consumer finance segment ending future purchases during the third quarter of 2025. The marine and RV portfolio is expected to run off over the next several years as scheduled borrower payments are made on the existing loans. As the consumer finance segment’s customers include non-prime borrowers, the anticipated rates of delinquencies, defaults, repossessions and losses on the consumer finance loans could be more dramatically affected by changes in general economic conditions. Changes in economic conditions may also affect consumer demand for used automobiles and values of automobiles securing outstanding loans, due to changes in demand or changes in levels of inventory of used automobiles, which may directly affect the amount of a loss incurred by the consumer finance segment in the event of default. While the consumer finance segment manages the higher risk inherent in loans made to “non-prime” borrowers through its underwriting criteria, portfolio management and collection methods, no guarantees can be made that these criteria or methods will afford adequate protection against these risks. With the consumer finance segment’s scorecard model for purchasing loan contracts, the credit-worthiness of borrowers at origination has improved for automobile loans 62 Table of Contents purchased and the level of credit losses experienced has decreased relative to long-term historical averages. No assurances can be made that the consumer finance segment’s net charge-off ratio will not increase in future periods. However, we believe that the current allowance for credit losses is adequate to reflect the net amount expected to be collected on existing consumer finance segment loans that may become uncollectible. If factors influencing the consumer finance segment result in higher net charge-off ratios in future periods, the consumer finance segment may need to increase the level of its allowance for credit losses through additional provisions for credit losses, which could negatively affect future earnings of the consumer finance segment. FINANCIAL CONDITION SUMMARY A financial institution’s primary sources of revenue are generated by its earning assets and sales of financial assets, while its major expenses are produced by the funding of those assets with interest-bearing liabilities, provisions for credit losses and compensation to employees. Effective management of these sources and uses of funds is essential in attaining a financial institution’s maximum profitability while maintaining an acceptable level of risk. At December 31, 2025, the Corporation had total assets of $2.77 billion compared to $2.56 billion at December 31, 2024. The increase was attributable primarily to increases in loans held for investment, available for sale securities and loans held for sale and was funded by growth in deposits. The significant components of the Corporation’s Consolidated Balance Sheets are discussed below. LOAN PORTFOLIO General Through the community banking segment, we engage in a wide range of lending activities, primarily in the community banking segment’s market area, which include the origination of commercial real estate loans, commercial business loans, commercial and consumer real estate construction loans, land acquisition and development loans, builder lines, residential mortgage loans, equity lines, and other consumer loans. We engage in automobile lending through the consumer finance segment, which also has a marine and RV portfolio that is expected to run off over the next several years as scheduled borrower payments are made on the existing loans, and in residential mortgage lending through the mortgage banking segment with the majority of the loans originated through the mortgage banking segment sold to third-party investors. At December 31, 2025, the Corporation’s loans held for investment in all categories, net of the allowance for credit losses, totaled $2.01 billion and loans held for sale had a fair value of $40.9 million. Credit Policy The Corporation’s credit policy establishes minimum requirements and provides for appropriate limitations on overall concentration of credit within the Corporation. The policy provides guidance in general credit policies, underwriting policies and risk management, credit approval, and administrative and problem asset management policies. The overall goal of the Corporation’s credit policy is to ensure that loan growth is accompanied by acceptable asset quality with uniform and consistently applied approval, administration, and documentation practices and standards. Residential Mortgage – Held for Sale The mortgage banking segment’s guidelines for underwriting conventional conforming loans comply with the underwriting criteria established by Fannie Mae, Freddie Mac and/or the applicable third party investor. The guidelines for non-conforming conventional loans are based on the requirements of private investors and information provided by third-party investors. The guidelines used by the mortgage banking segment to originate FHA-insured, USDA-guaranteed and VA-guaranteed loans comply with the criteria established by HUD, the USDA, the VA and/or the applicable third party investor. The conventional loans that the mortgage banking segment originates that have loan-to-value ratios greater than 80 percent at origination are generally insured by private mortgage insurance. 63 Table of Contents Commercial Real Estate The community banking segment’s commercial real estate loans are primarily secured by the value of real property. The proceeds of commercial real estate loans are generally used by the borrower to finance or refinance the cost of acquiring and/or improving a commercial property. The properties that typically secure these loans are office and warehouse facilities, hotels, apartment complexes, retail facilities, restaurants, residential investment properties and other commercial properties. Commercial real estate loans may be made to borrowers who will occupy or use the financed property in connection with their normal business operations or to borrowers who will use the subject property to generate rental income. Loans secured by non-owner-occupied properties are made when the borrower is in strong financial condition and oftentimes the borrower has substantially pre-leased the property to high-caliber tenants. Our commercial real estate loans are usually amortized over a period of time ranging from 15 years to 30 years and usually have a term to maturity ranging from 5 years to 15 years, with fixed rates of interest typically for periods of up to ten years. The maximum loan-to-value ratio for a commercial real estate loan is 80 percent; however, this maximum can be waived for particularly strong borrowers on an exception basis. Most commercial real estate loans are further secured by one or more personal guarantees. We believe these loan terms provide some protection from changes in the borrower’s business and income as well as changes in general economic conditions. In the case of fixed-rate commercial real estate loans, shorter maturities also provide an opportunity to adjust the interest rate on this type of interest-earning asset in accordance with our asset and liability management strategies. Certain commercial customers qualify for participation in an interest rate swap program. This program provides flexible pricing structures for our larger borrowers who wish to pay a fixed rate of interest, while preserving a floating rate for the Bank, which protects the Corporation from exposure to rising interest rates. Loans secured by commercial real estate are generally larger and involve a greater degree of risk than residential mortgage loans. Because payments on loans secured by commercial real estate are usually dependent on successful operation or management of the properties securing such loans, repayment of such loans is subject to changes in both general and local economic conditions and the borrower’s business and income. As a result, events beyond our control, such as a downturn in the local economy, could adversely affect the performance of the commercial real estate loan portfolio. We seek to minimize these risks by lending to established customers and generally restricting our commercial real estate loans to our primary market area. Emphasis is placed on the income producing characteristics and quality of the collateral. Commercial Business The community banking segment’s commercial business loan products include revolving lines of credit to provide working capital, term loans to finance the purchase of vehicles and equipment, letters of credit to guarantee payment and performance, and other commercial loans. In general, these credit facilities carry the unconditional guaranty of the owners and/or stockholders. Revolving and operating lines of credit are typically secured by all current assets of the borrower, provide for the acceleration of repayment upon any event of default, are monitored to ensure compliance with loan covenants, and are typically re-underwritten or renewed annually. Interest rates generally will float at a spread tied to the prime lending rate. Term loans are generally advanced for the purchase of, and are secured by, vehicles and equipment and are normally fully amortized over a term of two to seven years, on either a fixed or floating rate basis. Construction Lending – Commercial Real Estate and Consumer Real Estate The community banking segment has a real estate construction lending program, which includes loans primarily for the construction of one-to-four family residences and, to a lesser extent, multi-family dwellings. The community banking segment also makes construction loans for office and warehouse facilities and other nonresidential projects, generally limited to borrowers that present other business opportunities for the community banking segment. 64 Table of Contents The amounts, interest rates and terms for construction loans vary, depending upon market conditions, the size and complexity of the project, and the financial strength of the borrower and any guarantors of the loan. The term for a typical construction loan ranges from 12 months to 15 months for the construction of an individual residence and from 15 months to a maximum of 3 years for larger residential or commercial projects. We do not typically amortize construction loans, and the borrower pays interest monthly on the outstanding principal balance of the loan. The community banking segment offers fixed and variable interest rates on construction loans. For residential builder loans, we limit the number of models and/or speculative units allowed depending on market conditions, the builder’s financial strength and track record and other factors. Generally, the maximum loan-to-value ratio for one-to-four family residential construction loans is 80 percent of the property’s fair market value, or 90 percent of the property’s fair market value if the property will be the borrower’s primary residence. The fair market value of a project is determined on the basis of an appraisal of the project conducted by an appraiser approved by the Bank. For larger projects where unit absorption or leasing is a concern, we may also obtain a feasibility study or other acceptable information from the borrower or other sources about the likely disposition of the property following the completion of construction. Construction loans for nonresidential projects and multi-unit residential projects are generally larger and involve a greater degree of risk than residential mortgage loans. We attempt to minimize such risks (1) by making construction loans in accordance with our underwriting standards and to established customers in our primary market area and (2) by monitoring the quality, progress and cost of construction. Generally, our maximum loan-to-value ratio for non-residential projects and multi-unit residential projects is 80 percent; however, this maximum can be waived for particularly strong borrowers on an exception basis. The community banking segment makes loans to individuals for the purpose of acquiring an unimproved building site for the construction of a residence that generally will be occupied by the borrower. These loans are made only to individual borrowers and typically have a maximum term of either three or five years with a balloon payment of the entire balance of the loan being due in full at the end of the initial term. The interest rate for these loans is fixed at a rate that is slightly higher than prevailing rates for one-to-four family residential mortgage loans. We do not believe these loans bear as much risk as land acquisition and development loans because such loans are not made for the construction of residences for immediate resale, are not made to developers and builders, and are not concentrated in any one subdivision or community. Land Acquisition and Development The community banking segment makes land acquisition and development loans to builders and developers for the purpose of acquiring unimproved land to be developed for residential building sites, residential housing subdivisions, multi-family dwellings and a variety of commercial uses. Our policy is to make land acquisition loans to borrowers for the purpose of acquiring developed lots for single-family, townhouse or condominium construction. We will make both land acquisition and development loans to residential builders, experienced developers and others in strong financial condition to provide additional construction and mortgage lending opportunities for the Corporation. We underwrite and process land acquisition and development loans in much the same manner as commercial construction loans and commercial real estate loans. For land acquisition and development loans, we use lower loan-to-value ratios, which are a maximum of 65 percent for raw land, 75 percent for land development and improved lots and 80 percent of the discounted appraised value of the property as determined in accordance with the appraisal policies for developed lots for single-family or townhouse construction. We can waive the maximum loan-to-value ratio for particularly strong borrowers on an exception basis. The term of land acquisition and development loans typically range from a maximum of two years for loans relating to the acquisition of unimproved land to, generally, a maximum of three years for other types of projects. All land acquisition and development loans generally are further secured by one or more personal guarantees. Because these loans are usually larger in amount and involve more risk than consumer lot loans, we carefully evaluate the borrower’s assumptions and projections about market conditions and absorption rates in the community in which the property is located and the borrower’s ability to carry the loan if the borrower’s assumptions prove inaccurate. 65 Table of Contents Builder Lines The community banking segment offers builder lines of credit to residential home builders to support their land and lot inventory needs. A construction loan facility for a builder will typically have an expiration of 24 months or less. Each loan that is made under the master loan facility will have a stated maturity that allows time for the residential unit to be constructed and sold to a homebuyer under prevailing market conditions. Specific terms vary based on the purpose of the loan (e.g., lot inventory, spec or non pre-sold units, pre-sold units) and previous sales activity to new homebuyers in the particular development. Repayment relies upon the successful performance of the underlying residential real estate project. This type of lending carries a higher level of risk related to residential real estate market conditions, a functioning first and secondary market in which to sell residential properties, and the borrower’s ability to manage inventory and run projects. We manage this risk by lending to experienced builders and by using specific underwriting policies and procedures for these types of loans. Residential Mortgage – Held for Investment The community banking segment originates residential mortgage loans secured by first and second liens on properties located in its primary market areas in Virginia. Various types of residential first mortgage loans in addition to traditional long-term, fixed-rate loans are offered. The majority of such loans include 10, 15 and 30 year amortizing mortgage loans with fixed rates of interest. Second mortgage loans are offered with fixed and adjustable rates. Second mortgage loans are granted for a fixed period of time, usually between 5 and 15 years. Additionally, the community banking segment purchases residential mortgage loans from the mortgage banking segment under terms and conditions similar to third-party investors. Equity Lines The community banking segment offers its customers home equity lines of credit that enable customers to borrow funds secured by the equity in their homes. Currently, home equity lines of credit are offered with adjustable rates of interest that are generally priced at a spread to the prime lending rate. Home equity lines of credit are made on an open-end, revolving basis. Home equity lines of credit generally do not present as much risk as other types of consumer loans. These lines of credit must satisfy our underwriting criteria, including loan-to-value and credit score guidelines. Other Consumer The community banking segment offers a variety of consumer loans, including automobile, personal secured and unsecured, and loans secured by savings accounts or certificates of deposit. The shorter terms and generally higher interest rates on consumer loans help the community banking segment maintain a profitable spread between its average loan yield and its cost of funds. Consumer loans secured by collateral other than a personal residence generally involve more credit risk than residential mortgage loans because of the type and nature of the collateral or, in certain cases, the absence of collateral. However, we believe the higher yields generally earned on such loans compensate for the increased credit risk associated with such loans. These loans must satisfy our underwriting criteria, including loan-to-value, debt ratio and credit score guidelines. This loan category also includes demand deposit overdrafts. Indirect Automobiles The consumer finance segment has an extensive automobile dealer network through which it purchases installment contracts throughout its markets. Credit approval is centralized, which along with the application processing system, ensures that contract purchase decisions comply with the consumer finance segment’s underwriting policies and procedures. Finance contract application packages completed by prospective borrowers are submitted by the automobile dealers electronically through multiple third-party online automotive sales and finance platforms to the consumer finance segment’s automated origination and application system, which processes the credit bureau report, generates all relevant loan calculations and displays the requested contract structure. Consumer finance segment personnel with credit authority 66 Table of Contents review the transaction and determine whether to approve or deny the purchase of the contract. The purchase decision is based primarily on the applicant’s credit history with emphasis on prior auto loan history, current employment status, income, collateral type and mileage, and the loan-to-value ratio. The consumer finance segment’s underwriting and collateral guidelines form the basis for the purchase decision. Exceptions to credit policies and authorities must be approved by a designated credit officer. The consumer finance segment’s automobile customers are both prime and non-prime and as such, some customers may have experienced prior credit difficulties. Because the consumer finance segment serves some customers who are unable to meet the credit standards imposed by traditional automobile financing sources, we expect the consumer finance segment to sustain a higher level of credit losses in the automobile portfolio than traditional financing sources. However, in those cases, the consumer finance segment purchases these contracts with interest rates higher than those charged by traditional financing sources. These higher rates should more than offset the increase in the provision for credit losses for this segment of the Corporation’s loan portfolio. Indirect Marine and Recreational Vehicles In addition to purchasing automobile contracts through a dealer network, the consumer finance segment purchased marine and RV contracts, also on an indirect basis, through a third-party provider until they significantly decreased sales of those loans to outside parties during 2025, which led to the consumer finance segment ending future purchases under the program during the third quarter of 2025. While the approval process was generally the same as the indirect automobile approval process described above, borrowers on marine and RV contracts purchased by the consumer finance segment have typically not had prior credit issues and these contracts are considered prime. The rates charged on these loans were significantly less than the automobile portfolio with a much lower expected level of credit losses. Tables 18, 19 and 20 present information pertaining to the composition of loans held for investment, the composition of commercial real estate and construction commercial real estate loans, and the maturity/repricing of certain loans held for investment, respectively. TABLE 18: Summary of Loans Held for Investment December 31, 2025 December 31, 2024 (Dollars in thousands) Amount Percent Amount Percent Commercial real estate $ 835,432 41 % $ 734,182 38 % Commercial business 115,710 5 104,947 5 Construction - commercial real estate 99,604 5 132,717 7 Land acquisition and development 66,248 3 46,072 2 Builder lines 37,938 2 35,605 2 Construction - consumer real estate 29,288 1 18,799 1 Residential mortgage 319,536 16 308,809 16 Equity lines 76,460 3 62,204 3 Other consumer 10,085 1 10,270 1 Consumer finance - automobiles 406,312 20 398,651 21 Consumer finance - marine and recreational vehicles 57,963 3 68,142 4 Subtotal 2,054,576 100 % 1,920,398 100 % Less allowance for credit losses (39,677) (40,087) Loans, net $ 2,014,899 $ 1,880,311 The increase in total loans from December 31, 2024 to December 31, 2025 was due primarily to growth in commercial real estate, land acquisition and development and equity lines segments of the loan portfolio at the community banking segment. 67 Table of Contents TABLE 19: Commercial Real Estate and Construction Commercial Real Estate Loans December 31, 2025 (Dollars in thousands) Amount % of Commercial Real Estate and Construction Commercial Real Estate Loans % of Total Multifamily $ 177,215 19.0 % 8.6 % Retail 162,677 17.4 7.9 Office 123,274 13.2 6.0 Hotels 100,858 10.8 4.9 1-4 family investment properties 99,526 10.6 4.8 Industrial/warehouse 85,479 9.1 4.2 Mini-storage 66,983 7.2 3.3 Medical office 43,447 4.6 2.1 Other 75,577 8.1 3.7 $ 935,036 100 % 45.5 % December 31, 2024 (Dollars in thousands) Amount % of Commercial Real Estate and Construction Commercial Real Estate Loans % of Total Multifamily $ 172,574 19.9 % 9.0 % Retail 153,227 17.7 8.0 Office 120,412 13.9 6.3 Hotels 84,936 9.8 4.4 1-4 family investment properties 80,950 9.3 4.2 Industrial/warehouse 94,100 10.9 4.9 Mini-storage 39,368 4.5 2.1 Medical office 40,335 4.7 2.1 Other 80,997 9.3 4.1 $ 866,899 100 % 45.1 % 68 Table of Contents TABLE 20: Maturity/Repricing Schedule of Loans Held for Investment December 31, 2025 (Dollars in thousands) Commercial Consumer Consumer Finance Total Variable Rate: Within 1 year $ 350,875 $ 77,526 $ — $ 428,401 1 to 5 years 90,701 686 — 91,387 5 to 15 years 7,078 — — 7,078 After 15 years — — — — Fixed Rate: Within 1 year 154,610 6,991 4,628 166,229 1 to 5 years 385,075 107,872 228,796 721,743 5 to 15 years 182,415 170,656 230,851 583,922 After 15 years 13,466 42,350 — 55,816 $ 1,184,220 $ 406,081 $ 464,275 $ 2,054,576 SECURITIES The investment portfolio plays a primary role in the management of the Corporation’s interest rate sensitivity. In addition, the portfolio serves as a source of liquidity and is used as needed to meet collateral requirements. The investment portfolio consists of securities available for sale, which may be sold in response to changes in market interest rates, changes in prepayment risk, increases in loan demand, general liquidity needs and other similar factors. These securities are carried at estimated fair value. At December 31, 2025 and 2024, all debt securities in the Corporation’s investment portfolio were classified as available for sale. Table 21 sets forth the composition of the Corporation’s securities available for sale in dollar amounts at fair value and as a percentage of the Corporation’s total securities available for sale at the dates indicated. TABLE 21: Securities Available for Sale December 31, 2025 December 31, 2024 (Dollars in thousands) Amount Percent Amount Percent U.S. Treasury securities $ 4,887 1 % $ 10,700 3 % U.S. government agencies and corporations 55,710 12 60,659 14 Mortgage-backed securities 205,832 45 182,436 44 Obligations of states and political subdivisions 157,091 34 143,610 34 Corporate and other debt securities 34,591 8 21,220 5 Total available for sale securities at fair value $ 458,111 100 % $ 418,625 100 % Securities available for sale increased by $39.5 million to $458.1 million at December 31, 2025, compared to $418.6 million at December 31, 2024, due primarily to an increase in mortgage-backed securities, obligations of state and political subdivisions and corporate securities, partially offset by maturities and calls of U.S. Treasury securities and U.S. government agencies and corporations. Net unrealized losses on the market value of securities available for sale were $12.9 million at December 31, 2025, compared to $30.0 million at December 31, 2024. The decrease in the net unrealized losses on the market value of securities available for sale during 2025 was due primarily to fluctuations in debt security market interest rates and a decrease in the balance of securities available for sale in an unrealized loss position as a result of maturities, calls and paydowns. The Corporation seeks to diversify its portfolio to minimize risk, including by purchasing shorter-duration mortgage-backed securities to reduce interest rate risk and for cash flow and reinvestment opportunities and obligations of states and political subdivisions due to the tax benefits and the higher tax-adjusted yield obtained from these securities. All of the Corporation’s mortgage-backed securities are direct issues of United States government agencies or government-sponsored enterprises. Collectively, these entities provide a guarantee, which is either explicitly or implicitly supported by the full 69 Table of Contents faith and credit of the U.S. government, that investors in such mortgage-backed securities will receive timely principal and interest payments. The Corporation also invests in the debt securities of corporate issuers, primarily financial institutions, that the Corporation views as having a strong financial position and earnings potential. Table 22 presents additional information pertaining to the composition of the securities portfolio at amortized cost, by the earlier of contractual maturity or expected maturity. Expected maturities will differ from contractual maturities because borrowers may have the right to prepay obligations with or without call or prepayment penalties. The total effective duration of the investment portfolio was 3.7 years as of December 31, 2025. TABLE 22: Maturity of Securities December 31, 2025 Weighted Amortized Average (Dollars in thousands) Cost Yield 1 U.S. Treasury securities: Maturing within 1 year $ 4,992 1.38 % Total U.S. Treasury securities 4,992 1.38 U.S. government agencies and corporations: Maturing within 1 year 6,607 1.25 Maturing after 1 year, but within 5 years 31,410 1.41 Maturing after 5 years, but within 10 years 20,237 1.95 Maturing after 10 years 2,351 2.25 Total U.S. government agencies and corporations 60,605 1.61 Mortgage-backed securities: Maturing within 1 year 32,751 2.74 Maturing after 1 year, but within 5 years 94,600 2.85 Maturing after 5 years, but within 10 years 62,105 3.22 Maturing after 10 years 22,197 4.51 Total mortgage-backed securities 211,653 3.12 States and municipals:1 Maturing within 1 year 33,940 3.64 Maturing after 1 year, but within 5 years 62,588 3.11 Maturing after 5 years, but within 10 years 51,535 4.69 Maturing after 10 years 10,095 4.35 Total states and municipals 158,158 3.82 Corporate and other debt securities: Maturing within 1 year 6,250 3.31 Maturing after 1 year, but within 5 years 15,426 5.79 Maturing after 5 years, but within 10 years 13,952 7.15 Total corporate and other debt securities 35,628 5.89 Total securities: Maturing within 1 year 84,540 2.95 Maturing after 1 year, but within 5 years 204,024 2.93 Maturing after 5 years, but within 10 years 147,829 3.93 Maturing after 10 years 34,643 4.31 Total securities $ 471,036 3.35 1. Yields on tax-exempt securities have been computed on a taxable-equivalent basis using the federal corporate income tax rate of 21 percent. The weighted average yield is calculated based on the relative amortized costs of the securities. 70 Table of Contents DEPOSITS The Corporation’s predominant source of funds is depository accounts, which are comprised of demand deposits, savings and money market accounts, and time deposits. The Corporation’s deposits are principally provided by individuals and businesses located within the communities served. During the year ended December 31, 2025, deposits increased $174.9 million to $2.35 billion at December 31, 2025, compared to $2.17 billion at December 31, 2024. Noninterest bearing demand deposits increased $17.6 million, savings, money market and interest-bearing demand deposits increased $79.2 million and time deposits increased $78.1 million during the same period. The increases in deposits are due in part to the opening of new deposit accounts, higher average balances within the deposit accounts and the wind-down of the repurchase agreement program with certain commercial deposit customers during the third quarter of 2025. The balance of these repurchase agreements was $29.0 million at December 31, 2024. The Corporation had $162.4 million in municipal deposits at December 31, 2025 compared to $163.4 million at December 31, 2024. The Corporation had $25.0 million in brokered deposits outstanding at both December 31, 2025 and 2024. The Corporation may continue to use brokered deposits as a means of maintaining and diversifying liquidity and funding sources. Table 23 presents the average deposit balances and average rates paid for the years 2025, 2024 and 2023. TABLE 23: Average Deposits and Rates Paid Year Ended December 31, 2025 2024 2023 Average Average Average Average Average Average (Dollars in thousands) Balance Rate Balance Rate Balance Rate Noninterest-bearing demand deposits $ 557,743 $ 536,828 $ 575,452 Interest-bearing demand deposits 322,732 0.64 % 327,700 0.66 % 354,643 0.60 % Savings and money market deposit accounts 527,951 1.19 476,707 0.93 526,634 0.60 Time deposits 852,766 3.65 767,721 4.10 541,252 2.79 Total interest-bearing deposits 1,703,449 2.32 1,572,128 2.42 1,422,529 1.43 Total deposits $ 2,261,192 $ 2,108,956 $ 1,997,981 BORROWINGS In addition to deposits, the Corporation utilizes short-term and long-term borrowings as sources of funds. Short-term borrowings from the Federal Reserve Bank, the FHLB and overnight unsecured fed funds lines with correspondent banks may be used to fund the Corporation’s day-to-day operations. Long-term borrowings consist of FHLB advances and subordinated notes, which rank junior to all future senior indebtedness of the Corporation and are structurally subordinated to all existing and future debt and liabilities of the Corporation and its subsidiaries. Trust I, Trust II and CVBK Trust I are wholly-owned non-operating subsidiaries of the Corporation, formed for the purpose of issuing trust preferred capital securities. Collectively, these trusts have issued $25.0 million of trust preferred capital securities to institutional investors through private placements and $775,000 in common equity that is held by the Corporation. Trust preferred capital securities of $5.0 million issued by CVBK Trust I, $10.0 million issued by Trust I, and $10.0 million issued by Trust II mature in 2033, 2035 and 2037, respectively, and are redeemable at the Corporation’s option. The principal assets of CVBK Trust I, Trust I and Trust II are trust preferred capital notes of the Corporation of $5.2 million, $10.3 million and $10.3 million, respectively, which have like maturities and like interest rates to the trust preferred capital securities. The interest payments by the Corporation on the notes will be used by the trusts to pay the quarterly distributions on the trust preferred capital securities. 71 Table of Contents Borrowings decreased to $113.3 million at December 31, 2025 from $122.6 million at December 31, 2024 due primarily to the wind-down of the repurchase agreement program with certain commercial deposit customers of the community banking segment during the third quarter of 2025, partially offset by an increase in the Corporation’s subordinated debt. The balance of these repurchase agreements was $29.0 million at December 31, 2024. For further information concerning the Corporation’s borrowings, refer to Item 8. “Financial Statements and Supplementary Data” under the heading “Note 11: Borrowings.” OFF-BALANCE-SHEET ARRANGEMENTS To meet the financing needs of customers, the Corporation is a party, in the normal course of business, to financial instruments with off-balance-sheet risk. These financial instruments include commitments to extend credit, commitments to sell loans and standby letters of credit. These instruments involve elements of credit and interest rate risk in addition to the amount on the balance sheet. The Corporation’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and standby letters of credit written is represented by the contractual amount of these instruments. The Corporation uses the same credit policies in making these commitments and conditional obligations as for on-balance-sheet instruments and obtains collateral based on the credit assessment of the customer in each circumstance. Loan commitments are agreements to extend credit to a customer provided that there are no violations of the terms of the contract prior to funding. Commitments have fixed expiration dates or other termination clauses and may require payment of a fee by the customer. Since many of the commitments may expire without being completely drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The total amount of unused loan commitments at the Bank was $443.3 million at December 31, 2025, compared to $469.8 million at December 31, 2024. Off balance sheet credit exposures, including loan commitments, are not recorded on balance sheet, but expected credit losses arising from off balance sheet credit exposures are recorded as a reserve for unfunded commitments and reported in Other Liabilities. Standby letters of credit are written conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loans to customers. The total contract amount of standby letters of credit was $22.2 million at December 31, 2025, compared to $18.8 million at December 31, 2024. The mortgage banking segment sells the majority of the residential mortgage loans it originates to third-party investors. Additionally, the community banking segment purchases residential mortgage loans from the mortgage banking segment under terms and conditions similar to third-party investors. As is customary in the industry, the agreements with these investors require the mortgage banking segment to extend representations and warranties with respect to program compliance, borrower misrepresentation, fraud, and early payment performance. Under the agreements, the investors are entitled to make loss claims and repurchase requests of the mortgage banking segment for loans that contain covered deficiencies. The mortgage banking segment has obtained early payment default recourse waivers for a portion of its business. Recourse periods for early payment default for the remaining investors vary from 90 days up to one year. Recourse periods for borrower misrepresentation or fraud, or underwriting error do not have a stated time limit. The mortgage banking segment maintains an allowance for indemnifications that represents management’s estimate of losses that are probable of arising under these recourse provisions. As performance data for loans that have been sold is not made available to the mortgage banking segment by the investors, the estimate of potential losses is inherently subjective and is based on historical indemnification payments and management’s assessment of current conditions that may contribute to indemnified losses on mortgage loans that have been sold in the secondary market, including the volume of loans sold, historical experience, current economic conditions, changes in operational and compliance processes, and information provided by investors. During the years ended December 31, 2025, 2024 and 2023, the mortgage banking segment reversed $190,000 and $460,000 and $585,000, respectively. The release of indemnification reserves in 2025, 2024 and 2023 was due primarily to lower volume of mortgage loan originations in recent years, improvement in the mortgage banking segment’s assessment of borrower payment performance and other factors affecting expected losses on mortgage loans sold in the secondary market, such as time since origination. The releases in 2025 decreased compared to the same period 72 Table of Contents in 2024 due primarily to the increased mortgage loan originations in 2025 compared to 2024. The balance of the allowance at December 31, 2025 and 2024 was $1.2 million and $1.3 million, respectively. Actual indemnification payments may differ materially from management’s estimates, which may result in additional provision for indemnification losses in future periods. There were no payments made in 2025, 2024 or 2023. Risks also arise from the possible inability of investors to meet the terms of their contracts. The mortgage banking segment has procedures in place to evaluate the credit risk of investors and does not expect any counterparty to fail to meet its obligations. The Corporation’s derivative financial instruments include (1) interest rate swaps that qualify and are designated as cash flow hedges on the Corporation’s trust preferred capital notes, (2) interest rate swaps with certain qualifying commercial loan customers and dealer counterparties and (3) interest rate contracts arising from mortgage banking activities, including interest rate lock commitments (IRLCs) on mortgage loans. For further information concerning the Corporation’s derivatives, refer to Item 8. “Financial Statements and Supplementary Data” under the heading “Note 21: Derivative Financial Instruments.” LIQUIDITY The objective of the Corporation’s liquidity management is to ensure the continuous availability of funds to satisfy the credit needs of our customers and the demands of our depositors, creditors and investors. Stable core deposits and a strong capital position are the components of a solid foundation for the Corporation’s liquidity position. Additional sources of liquidity available to the Corporation include cash flows from operations, loan payments and payoffs, deposit growth, maturities, calls and sales of securities, the issuance of brokered certificates of deposit and the capacity to borrow additional funds. Depending on the Corporation’s liquidity levels, conditions in the capital markets and other factors, the Corporation may from time to time consider the issuance of debt, equity or other securities, the proceeds of which could provide additional liquidity for our operations. Liquid assets, which include cash and due from banks, interest-bearing deposits at other banks, federal funds sold and nonpledged securities available for sale, totaled $406.4 million at December 31, 2025. The Corporation’s funding sources, including capacity, amount outstanding and amount available at December 31, 2025 are presented in Table 24. The Corporation’s capacity and amount available both increased $68.6 million from December 31, 2024 as a result of fluctuations in loans pledged to the FHLB and Federal Reserve Bank. TABLE 24: Funding Sources December 31, 2025 (Dollars in thousands) Capacity Outstanding Available Unsecured federal funds agreements $ 75,000 $ — $ 75,000 Borrowings from FHLB 276,703 40,000 236,703 Borrowings from FRB 363,100 — 363,100 Total $ 714,803 $ 40,000 $ 674,803 December 31, 2024 (Dollars in thousands) Capacity Outstanding Available Unsecured federal funds agreements $ 75,000 $ — $ 75,000 Borrowings from FHLB 257,734 40,000 217,734 Borrowings from FRB 313,499 — 313,499 Total $ 646,233 $ 40,000 $ 606,233 We have no reason to believe these arrangements will not be renewed at maturity. Additional loans and securities are available that can be pledged as collateral for future borrowings from the FHLB and Federal Reserve Bank above the current lendable collateral value. Our ability to maintain sufficient liquidity may be affected by numerous factors, including economic conditions nationally and in our markets. Depending on our liquidity levels, our capital position, conditions in the capital markets, our business operations and initiatives, and other factors, we may from time to time consider the 73 Table of Contents issuance of debt, equity or other securities or other possible capital market transactions, the proceeds of which could provide additional liquidity for our operations. Time deposits maturing in less than one year and in more than one year totaled $837.9 million and $58.5 million, respectively, at December 31, 2025. Uninsured deposits represent an estimate of amounts above the FDIC insurance coverage limit of $250,000. As of December 31, 2025, the Corporation’s uninsured deposits were approximately $710.4 million, or 30.3 percent of total deposits, compared to $640.2 million or 29.5 percent of total deposits at December 31, 2024. Excluding intercompany cash holdings and municipal deposits, which are secured with pledged securities, amounts uninsured were approximately $527.8 million, or 22.5 percent of total deposits as of December 31, 2025, compared to 21.0 percent of total deposits as of December 31, 2024. The Corporation’s liquid assets and borrowing availability as of December 31, 2025 totaled $1.08 billion, exceeding uninsured deposits, excluding intercompany cash holdings and secured municipal deposits, by $553.4 million. The Corporation’s internal policy limits brokered deposits to 20 percent of total deposits, representing approximately $555.6 million of additional net availability for additional brokered deposits as of December 31, 2025. In the ordinary course of business, the Corporation has entered into contractual obligations and has made other commitments to make future payments. For further information concerning the Corporation’s expected timing of such payments as of December 31, 2025, refer to Item 8. “Financial Statements and Supplementary Data” under the headings “Note 9: Leases,” “Note 11: Borrowings,” and “Note 18: Commitments and Contingent Liabilities.” As a result of the Corporation’s management of liquid assets and the ability to generate liquidity through liability funding, management believes that the Corporation maintains overall liquidity sufficient to satisfy its operational requirements and contractual obligations. CAPITAL RESOURCES Total equity was $262.3 million as of December 31, 2025, compared with $227.0 million as of December 31, 2024. During 2025 the Corporation declared common stock dividends totaling $1.84 per share and during each of 2024 and 2023, the Corporation declared common stock dividends totaling $1.76 per share. The assessment of capital adequacy depends on such factors as asset quality, liquidity, earnings performance, and changing competitive conditions and economic forces. We regularly review the adequacy of the Corporation’s and the Bank’s capital. We maintain a structure that will assure an adequate level of capital to support anticipated asset growth and to absorb potential losses. While we will continue to look for opportunities to invest capital in profitable growth, share repurchases are another tool that facilitates improving shareholder return, as measured by ROE and earnings per share. Under the small bank holding company policy statement of the Federal Reserve Board, which applies to certain bank holding companies with consolidated total assets of less than $3 billion, the Corporation was not subject to regulatory capital requirements as of December 31, 2025. The disclosure below reflects the Corporation’s consolidated capital as determined under regulations that apply to bank holding companies that are not small bank holding companies and minimum capital requirements that would apply to the Corporation if it were not a small bank holding company. At December 31, 2025 and 2024, the Corporation’s CET1 to total risk-weighted assets ratio was 11.0 percent and 10.7 percent, respectively; the Corporation’s Tier 1 capital to risk-weighted assets ratio was 12.2 percent and 11.9 percent, respectively; the Corporation’s total capital to risk-weighted assets ratio was 15.2 percent and 14.1 percent, respectively; and the Corporation’s Tier 1 leverage ratio was 10.0 percent and 9.8 percent, respectively. These ratios at December 31, 2025 include $25.0 million of trust preferred capital securities in Tier 1 capital of the Corporation and $40.0 million of outstanding subordinated notes of the Corporation in Tier 2 capital. At December 31, 2024 these ratios included $25.0 million of trust preferred capital securities in Tier 1 capital of the Corporation and $20.0 million of subordinated notes in Tier 2 capital. The Corporation repurchased $20.0 million of subordinated notes and issued $40.0 million of subordinated 74 Table of Contents notes during the second quarter of 2025. The net increase of $20 million in subordinated notes increased the total capital of the Corporation. The Corporation used a portion of the proceeds from the new subordinated notes issuance to increase its investment in the Bank by $25.0 million, which increased CET1, Tier 1 capital and total capital of the Bank. At December 31, 2025 and 2024, the Bank’s CET1 to total risk-weighted assets ratio was 13.6 percent and 12.3 percent, respectively; the Bank’s Tier 1 capital to risk-weighted assets ratio was 13.6 percent and 12.3 percent, respectively; the Bank’s total capital to risk-weighted assets ratio was 14.8 percent and 13.5 percent, respectively; and the Bank’s Tier 1 leverage ratio was 11.1 percent and 10.1 percent, respectively. Total risk-weighted assets at December 31, 2025 for the Corporation and the Bank were $2.26 billion and $2.23 billion, respectively, compared to $2.13 billion and $2.10 billion, respectively, at December 31, 2024. All regulatory capital ratios of the Bank were in excess of mandated minimum requirements at December 31, 2025 and 2024. In addition to the regulatory risk-based capital requirements, the Bank must maintain a capital conservation buffer of additional capital of 2.5 percent of risk-weighted assets as required by the Basel III Final Rule. Including the capital conservation buffer, the minimum ratios are a common equity Tier 1 risk-based capital ratio of 7.0 percent, a Tier 1 risk-based capital ratio of 8.5 percent and a total risk-based capital ratio of 10.5 percent. The Corporation and the Bank exceeded these ratios at December 31, 2025 and 2024. The Corporation's capital resources are impacted by its share repurchase programs. During the year ended December 31, 2025, the Corporation did not repurchase any of its common stock under the 2025 Repurchase Program, which expired December 31, 2025. In December 2025, the Board of Directors authorized a program, effective January 1, 2026 through December 31, 2026, to repurchase up to $5.0 million of the Corporation’s common stock (the 2026 Repurchase Program). Repurchases under the program may be made through privately negotiated transactions or open market transactions, including pursuant to a trading plan in accordance with Rule 10b5-1 and/or Rule 10b-18 under the Securities Exchange Act of 1934, as amended, and shares repurchased will be returned to the status of authorized and unissued shares of common stock. The timing, number and purchase price of shares repurchased under the program will be determined by management in its discretion and will depend on a number of factors, including the market price of the shares, general market and economic conditions, applicable legal requirements and other conditions, and there is no assurance that the Corporation will purchase any shares under the 2026 Repurchase Program. RECENT ACCOUNTING PRONOUNCEMENTS Recent accounting pronouncements affecting the Corporation are described in Item 8. “Financial Statements and Supplementary Data” under the heading “Note 1: Summary of Significant Accounting Policies-Recent Significant Accounting Pronouncements.” USE OF CERTAIN NON-GAAP FINANCIAL MEASURES The accounting and reporting policies of the Corporation conform to GAAP in the United States and prevailing practices in the banking industry. However, certain non-GAAP measures are used by management to supplement the evaluation of the Corporation’s performance. These include net tangible income attributable to the Corporation, ROTCE, tangible book value per share, price to tangible book value ratio, and the following fully-taxable equivalent (FTE) measures: interest and fees on loans-FTE, interest income and dividends on securities-FTE, total interest income-FTE and net interest income-FTE. Interest on tax-exempt loans and securities is presented on a taxable-equivalent basis (which converts the income on loans and investments for which no income taxes are paid to the equivalent yield as if income taxes were paid) using the federal corporate income tax rate of 21 percent that was applicable for all periods presented. Management believes that the use of these non-GAAP measures provides meaningful information about operating performance by enhancing comparability with other financial periods, other financial institutions, and between different sources of interest income. The non-GAAP measures used by management enhance comparability by excluding the effects of balances of intangible assets, including goodwill, that vary significantly between institutions and tax benefits that are not consistent across different opportunities for investment. These non-GAAP financial measures should not be considered an alternative to, or more important than, GAAP-basis financial statements, and other bank holding companies may define or calculate these or similar measures differently. 75 Table of Contents A reconciliation of the non-GAAP financial measures used by the Corporation to evaluate and measure the Corporation’s performance to the most directly comparable GAAP financial measures is presented below. TABLE 25: Non-GAAP Table For The Year Ended December 31, (Dollars in thousands, except per share amounts) 2025 2024 2023 Reconciliation of Certain Non-GAAP Financial Measures Return on Average Tangible Common Equity Average total equity, as reported $ 243,033 $ 220,856 $ 203,261 Average goodwill (25,191) (25,191) (25,191) Average other intangible assets (1,017) (1,273) (1,538) Average noncontrolling interest (693) (649) (675) Average tangible common equity $ 216,132 $ 193,743 $ 175,857 Net income $ 26,991 $ 19,918 $ 23,746 Amortization of intangibles 238 260 273 Net income attributable to noncontrolling interest (156) (84) (142) Net tangible income attributable to C&F Financial Corporation $ 27,073 $ 20,094 $ 23,877 Return on average equity, as reported 11.11 % 9.02 % 11.68 % Return on average tangible common equity 12.53 % 10.37 % 13.58 % For The Year Ended (Dollars in thousands, except per share amounts) December 31, Fully Taxable Equivalent Net Interest Income1 2025 2024 2023 Interest and fees on loans $ 135,623 $ 127,089 $ 110,938 FTE adjustment 198 199 208 FTE interest and fees on loans $ 135,821 $ 127,288 $ 111,146 Interest and dividends on securities $ 13,378 $ 11,131 $ 11,954 FTE adjustment 1,037 948 756 FTE interest and dividends on securities $ 14,415 $ 12,079 $ 12,710 Total interest income $ 151,499 $ 139,594 $ 124,137 FTE adjustment 1,235 1,147 964 FTE interest income $ 152,734 $ 140,741 $ 125,101 Net interest income $ 106,210 $ 96,775 $ 97,707 FTE adjustment 1,235 1,147 964 FTE net interest income $ 107,445 $ 97,922 $ 98,671 1. Interest on tax-exempt loans and securities is converted to the taxable-equivalent basis using the federal corporate income tax rate of 21 percent that was applicable for all periods presented. (Dollars in thousands, except per share amounts) December 31, Tangible Book Value Per Share 2025 2024 Equity attributable to C&F Financial Corporation $ 261,753 $ 226,360 Less goodwill (25,191) (25,191) Less other intangible assets (909) (1,147) Tangible equity attributable to C&F Financial Corporation $ 235,653 $ 200,022 Shares outstanding 3,245,972 3,233,672 Book value per share $ 80.64 $ 70.00 Tangible book value per share $ 72.60 $ 61.86 76 Table of Contents