PEAPACK GLADSTONE FINANCIAL CORP (PGC)

CIK: 0001050743. SIC: 6029 Commercial Banks, NEC. Latest 10-K as of: 2026-03-11.

SIC breadcrumb: Finance, Insurance, And Real Estate > Depository Institutions > SIC 6029 Commercial Banks, NEC

SEC company page: https://www.sec.gov/edgar/browse/?CIK=1050743. Latest filing source: 0001193125-26-101763.

Selected Fundamentals

Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-03-11. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001050743.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

Flow metrics use full-year FY periods from 10-K/10-K/A filings; balance-sheet metrics use FY-end instants. Free cash flow = operating cash flow - capital expenditures. Missing metrics are omitted rather than fabricated.

Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

Financial Charts

Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-08. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001050743.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

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: 0001193125-26-213949.

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary. Confidence: high. Filing date: 2026-05-08. Report date: 2026-03-31.

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

FORWARD LOOKING STATEMENTS: This Quarterly Report on Form 10-Q may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are not historical facts and include expressions about Management’s confidence and strategies and Management’s expectations about operations, growth, financial results, asset quality, new and existing programs and products, investments, relationships, opportunities and market conditions. These statements may be identified by such forward-looking terminology as “expect”, “look”, “believe”, “anticipate”, “may”, or similar statements or variations of such terms. Actual results may differ materially from such forward-looking statements. Factors that may cause results to differ materially from those contemplated by such forward-looking statements include, among others, those risk factors identified in the Company’s Form 10-K for the year ended December 31, 2025, which include the following:

•
our ability to successfully grow our business and implement our strategic plan, including our ability to generate revenues to offset the increased personnel and other costs related to the strategic plan;

•
the impact of anticipated higher operating expenses in 2026 and beyond;

•
our ability to successfully integrate wealth management firm and team acquisitions;

•
our ability to successfully integrate our expanded employee base;

•
an unexpected decline in the economy, in particular in our New Jersey and New York market areas, including potential recessionary conditions, which could affect the demand for loans and deposits or have an adverse effect on the ability of consumers and businesses to pay debts;

•
declines in our net interest margin caused by the interest rate environment and/or our highly competitive market;

•
declines in the value in our investment portfolio;

•
impact from a pandemic event on our business, operations, customers, allowance for credit losses and capital levels;

•
higher than expected increases in our allowance for credit losses;

•
changes in the methodology and assumptions used to calculate the allowance for credit losses;

•
higher than expected increases in credit losses or in the level of delinquent, nonperforming, classified and criticized loans or charge-offs;

•
inflation and changes in interest rates, which may adversely impact our margins and yields, reduce the fair value of our financial instruments, reduce our loan originations and lead to higher operating costs;

•
decline in real estate values within our market areas;

•
legislative and regulatory actions (including the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Basel III and related regulations) that may result in increased compliance costs;

•
the imposition of tariffs or other domestic or international governmental policies and retaliatory responses;

•
the impact of any federal government shutdown;

•
the failure to maintain current technologies and/or to successfully implement future information technology enhancements;

•
successful cyberattacks against our IT infrastructure and that of our IT and third-party providers;

•
higher than expected FDIC insurance premiums;

•
adverse weather conditions;

•
the current or anticipated impact of military conflict, terrorism or other geopolitical events;

•
our inability to successfully generate new business in new geographic markets, including our expansion into New York City and Long Island;

•
a reduction in our lower-cost funding sources;

•
changes in liquidity, including the size and composition of our deposit portfolio, including the percentage of uninsured deposits in the portfolio;

•
our inability to adapt to technological changes;

•
claims and litigation pertaining to fiduciary responsibility, environmental laws and other matters;

•
our inability to retain key employees;

•
demand for loans and deposits in our market areas;

•
adverse changes in securities markets;

•
changes in New York City rent regulation law;

•
changes in governmental regulation, including, but not limited to, any increase in FDIC insurance premiums and changes in the monetary and fiscal policies of the U.S. Treasury and the Board of Governors of the Federal Reserve System;

•
changes in accounting policies and practices; and/or

•
other unexpected material adverse changes in our financial condition, operations or earnings.

45

Except as may be required by applicable law or regulation, the Company undertakes no duty to update any forward-looking statements to conform the statement to actual results or change in the Company’s expectations. Although we believe that the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, levels of activity, performance, or achievements.

46

CRITICAL ACCOUNTING POLICIES AND ESTIMATES: Management’s Discussion and Analysis of Financial Condition and Results of Operations is based upon the Company’s consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. Note 1 to the Company’s Audited Consolidated Financial Statements for the year ended December 31, 2025 contains a summary of the Company’s significant accounting policies.

The Company’s determination of the allowance for credit losses involves a higher degree of complexity and requires Management to make difficult and subjective judgments, which often require assumptions or estimates about highly uncertain matters. Changes in the methodology for determining the allowance for credit losses or in these judgments, assumptions or estimates could materially impact our results of operations. This critical policy and its application are reviewed periodically with the Audit Committee and the Board of Directors.

The allowance for credit losses is a valuation allowance of Management’s estimate of expected credit losses in the loan portfolio calculated in accordance with ASC 326, "Credit Losses". The process to determine expected credit losses utilizes analytic tools and Management judgment and is reviewed on a quarterly basis. When Management is reasonably certain that a loan balance is not fully collectable, an analysis is completed whereby a specific reserve may be established or a full or partial charge-off is recorded against the allowance. Subsequent recoveries, if any, are credited to the allowance. Management estimates the allowance balance via a quantitative analysis, which considers available information from internal and external sources related to past loan loss and prepayment experience and current economic conditions, as well as the incorporation of reasonable and supportable forecasts. Management evaluates a variety of factors, including available published economic information, in arriving at its forecasts. Expected credit losses are estimated over the contractual term of the loans, adjusted for expected prepayments when appropriate. Also included in the allowance for credit losses are qualitative reserves that are expected, but, in the Management’s assessment, may not be adequately represented in the quantitative analysis or the forecasts described above. Factors may include, among others, changes in lending policies and procedures, size and composition of the portfolio, experience and depth of Management and the effect of external factors such as competition and legal and regulatory requirements. The allowance is available for any loan that, in Management’s judgment, should be charged off.

Although Management uses the best information available, the level of the allowance for credit losses remains an estimate, which is subject to significant judgment and short-term change. Various regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for credit losses. Such agencies may require the Company to make additional provisions for credit losses based upon information available to them at the time of their examination. Furthermore, the majority of the Company’s loans are secured by real estate in New Jersey and the boroughs of New York City. Accordingly, the collectability of a substantial portion of the carrying value of the Company’s loan portfolio is susceptible to changes in local market conditions, rent control regulations and any adverse economic conditions. Future adjustments to the provision for credit losses and allowance for credit losses may be necessary due to economic, operating, regulatory and other conditions beyond the Company’s control.

47

EXECUTIVE SUMMARY: The following table presents certain key aspects of our performance for the three months ended March 31, 2026 and 2025.

For the Three Months Ended March 31,

Change

(Dollars in thousands, except per share data)

2026

2025

2026 vs 2025

Results of Operations:

Interest income

$

95,049

$

86,345

$

8,704

Interest expense

35,153

40,840

(5,687

)

Net interest income

59,896

45,505

14,391

Wealth management fee income

16,503

15,435

1,068

Other income

6,094

3,419

2,675

Total other income

22,597

18,854

3,743

Total revenue

82,493

64,359

18,134

Operating expense

55,440

49,440

6,000

Pretax income before provision for credit losses

27,053

14,919

12,134

Provision for credit losses

7,327

4,471

2,856

Pretax income

19,726

10,448

9,278

Income tax expense

5,573

2,853

2,720

Net income

14,153

7,595

6,558

Dividends on preferred stock

—

—

—

Net income available to common shareholders

$

14,153

$

7,595

$

6,558

Diluted average shares outstanding

17,760,678

17,812,222

(51,544

)

Diluted earnings per share

$

0.80

$

0.43

$

0.37

Return on average assets annualized ("ROAA")

0.74

%

0.43

%

0.31

%

Return on average equity annualized ("ROAE")

8.51

4.98

3.53

March 31,

December 31,

Change

2026

2025

2026 vs 2025

Selected Balance Sheet Ratios:

Total capital (Tier I + II) to risk-weighted assets

12.08

%

12.68

%

(0.60

)%

Tier I leverage ratio

9.24

8.87

0.37

Loans to deposits

94.25

94.91

(0.66

)

Allowance for credit losses to total loans

1.04

1.14

(0.10

)

Allowance for credit losses to nonperforming loans

112.99

104.10

8.89

Nonperforming loans to total loans

0.92

1.09

(0.17

)

For the quarter ended March 31, 2026, the Company recorded total revenue of $82.5 million, pretax income of $19.7 million, net income of $14.2 million and diluted earnings per share of $0.80, compared to revenue of $64.4 million, pretax income of $10.4 million, net income of $7.6 million and diluted earnings per share of $0.43 for the same period last year.

The increase in total revenue for the first quarter of 2026 was primarily due to higher net interest income of $14.4 million offset by increases in operating expenses and provision for credit losses. The increase in operating expenses was principally attributable to the addition of new employees related to the Company's expansion into New York City and Long Island and the expansion of the equipment financing team, increased health insurance costs and annual merit increases. The implementation of the strategy, including our metro New York City expansion, continues to deliver lower-cost core deposit relationships resulting in consistent improvement in our cost of funds and net interest margin. During the first quarter of 2026, deposits grew $237.8 million, which included $115.8 million in noninterest-bearing demand deposits. Net interest margin improved to 3.26 percent for the first quarter of 2026 as compared to 2.68 percent for the same period in 2025. Wealth management fee income continues to be a consistent and steady revenue stream for the Company and re

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

Latest 10-K MD&A

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary. Confidence: high. Filing date: 2026-03-11. Report date: 2025-12-31.

Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

CAUTIONARY STATEMENT CONCERNING FORWARD LOOKING STATEMENTS: This Annual Report on Form 10-K may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are not historical facts and include expressions about Management’s confidence, strategies and expectations about new and existing programs and products, investments, relationships, financial results and operations, opportunities and market conditions. These statements may be identified by such forward-looking terminology as “expect,” “look,” “believe,” “anticipate,” “may,” or similar statements or variations of such terms. Actual results may differ materially from such forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, but are not limited to:

•
our ability to successfully grow our business and implement our strategic plan, including our ability to generate revenues to offset the increased personnel and other costs related to the strategic plan;

•
the impact of anticipated higher operating expenses in 2026 and beyond;

•
our ability to successfully integrate wealth management firm and team acquisitions;

•
our ability to successfully integrate our expanded employee base;

28

•
a decline in the economy, in particular in our New Jersey and New York market areas, including potential recessionary conditions;

•
declines in our net interest margin caused by the interest rate environment and/or our highly competitive market;

•
declines in the value in our investment portfolio;

•
impact from a pandemic event on our business, operations, customers, allowance for credit losses and/or capital levels;

•
increases in our allowance for credit losses;

•
changes in the methodology and assumptions used to calculate the allowance for credit losses;

•
higher than expected increases in credit losses or in the level of delinquent, nonperforming, classified and criticized loans or charge-offs;

•
inflation and changes in interest rates, which may adversely impact our margins and yields, reduce the fair value of our financial instruments, reduce our loan originations and lead to higher operating costs;

•
decline in real estate values within our market areas;

•
legislative and regulatory actions (including the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Basel III and related regulations) that may result in increased compliance costs;

•
the imposition of tariffs or other domestic or international governmental policies and retaliatory responses;

•
the impact of any federal government shutdown;

•
the failure to maintain current technologies and/or to successfully implement future information technology enhancements;

•
successful cyberattacks against our IT infrastructure and that of our IT and third-party providers;

•
increased FDIC insurance premiums;

•
adverse weather conditions;

•
the current or anticipated impact of military conflict, terrorism or other geopolitical events;

•
our inability to successfully generate new business and brand recognition in new geographic markets, including our expansion into New York City and Long Island;

•
a reduction in our lower-cost funding sources;

•
changes in liquidity, including the size and composition of our deposit portfolio, including the percentage of uninsured deposits in the portfolio;

•
our inability to adapt to technological changes;

•
claims and litigation pertaining to fiduciary responsibility, environmental laws and other matters;

•
our inability to retain key employees;

•
demand for loans and deposits in our market areas;

•
adverse changes in securities markets;

•
changes in new York City rent regulation law;

•
changes in governmental regulation, including, but not limited to, changes in the monetary and fiscal policies of the U.S. Treasury and the Board of Governors of the Federal Reserve System;

•
changes in accounting policies and practices; and/or

•
other unexpected material adverse changes in our operations or earnings.

Except as may be required by applicable law or regulation, the Company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations. Although we believe that the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, levels of activity, performance or achievements.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES: Management’s Discussion and Analysis of Financial Condition and Results of Operations is based upon the Company’s consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. Note 1 to the Company’s Audited Consolidated Financial Statements contains a summary of the Company’s significant accounting policies.

The Company's determination of the allowance for credit losses involves a higher degree of complexity and requires Management to make difficult and subjective judgments, which often require assumptions or estimates about highly uncertain matters. Changes in the methodology for determining the allowance for credit losses or in these judgments, assumptions or estimates could materially impact results of operations. This critical policy and its application are periodically reviewed with the Audit Committee and the Board of Directors.

29

The allowance for credit losses is a valuation allowance, which represents Management’s estimate of expected credit losses in the loan portfolio calculated in accordance with ASC 326, "Credit Losses". The process to determine expected credit losses utilizes analytic tools and Management judgment and is reviewed on a quarterly basis. When Management is reasonably certain that a loan balance is not fully collectable, an analysis is completed whereby a specific reserve may be established or a full or partial charge-off is recorded against the allowance. Subsequent recoveries, if any, are credited to the allowance. Management estimates the allowance balance via a quantitative analysis, which considers available information from internal and external sources related to past loan loss and prepayment experience and current economic conditions, as well as the incorporation of reasonable and supportable economic forecasts. Management evaluates a variety of factors, including available published economic information, in arriving at its forecasts. Expected credit losses are estimated over the contractual term of the loans, adjusted for expected prepayments when appropriate. Also included in the allowance for credit losses are qualitative reserves that are expected, but, in the Management’s assessment, may not be adequately represented in the quantitative analysis or the forecasts described above. Factors may include, among others, changes in lending policies and procedures, size and composition of the portfolio, experience and depth of Management and the effect of external factors such as competition and legal and regulatory requirements. The allowance is available for any loan that, in Management’s judgment, should be charged off.

Although Management uses the best information available, the level of the allowance for credit losses remains an estimate, which is subject to significant judgment and short-term change. Various regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for credit losses. Such agencies may require the Company to make additional provisions for credit losses based upon information available to them at the time of their examination. Furthermore, the majority of the Company’s loans are secured by real estate in New Jersey and the boroughs of New York City. Accordingly, the collectability of a substantial portion of the Company’s loan portfolio is susceptible to changes in local market conditions, rent control regulations and any adverse economic conditions. Future adjustments to the provision for credit losses and the allowance for credit losses may be necessary due to economic, operating, regulatory and other conditions beyond the Company’s control.

The Company’s quantitative component of its allowance for credit losses for collectively evaluated loans is calculated with an economic forecast sourced from Moody’s. Management performed a hypothetical sensitivity analysis to understand the impact of changes in the economic forecast as a key input in our calculation of the allowance for credit losses for collectively evaluated loans. Within the various economic scenarios considered for this hypothetical sensitivity analysis, as of December 31, 2025, the quantitative estimate of the allowance for credit loss for collectively evaluated loans would increase by approximately $23 million under sole consideration of an adverse Moody’s economic forecast, which when stressed, resulted in the national unemployment rate increasing to 8.3 percent and negative growth for national GDP of approximately 2.6 percent. The hypothetical sensitivity calculation reflects the sensitivity of the modeled allowance estimate to macroeconomic forecast data but lacks other qualitative overlays and other qualitative adjustments that are part of the quarterly allowance calculation process. As such, this does not necessarily reflect the nature and extent of future changes in the allowance for reasons including increases or decreases in qualitative adjustments, changes in the risk profile, size and composition of the loan portfolio, changes in the severity of the macroeconomic scenario and the range of scenarios under management consideration.

OVERVIEW: The following discussion and analysis is intended to provide information about the financial condition and results of operations of the Company and its subsidiaries on a consolidated basis and should be read in conjunction with the consolidated financial statements and the related notes and supplemental financial information appearing elsewhere in this report.

For the year ended December 31, 2025, the Company recorded net income of $37.3 million, and diluted earnings per share of $2.10, compared to $33.0 million and $1.85, respectively, for 2024, reflecting increases of $4.3 million, or 13 percent, and $0.25 per share, or 14 percent, respectively. During 2025, the Company continued to focus on its expansion into the metro New York region. During 2025, the Company added six new production teams in Long Island. The Company's metro New York initiative has resulted in approximately $1.9 billion in new core relationship deposits, 31 percent of which is in noninterest-bearing accounts. The Company also grew the wealth management team through the addition of experienced advisers to help serve the expanded geography throughout the metro NY market.

The following are selected highlights from 2025:

•
At December 31, 2025, the market value of assets under management in our Wealth Management Division grew by $1.2 billion to $13.1 billion, reflecting an increase of 10 percent from $11.9 billion at December 31, 2024.

•
Wealth Management fee income was $63.2 million in 2025, which comprised 22 percent of the Company's total revenue for the year.

30

•
Total loans increased by $741 million, or 13 percent, to $6.3 billion at December 31, 2025 compared to $5.5 billion at December 31, 2024.

•
At December 31, 2025, total C&I loans (including equipment finance loans) comprised 44 percent of the total loan portfolio.

•
Total deposits increased by $460 million, or 8 percent, to $6.6 billion at December 31, 2025 compared to $6.1 billion at December 31, 2024.

•
Noninterest-bearing demand deposits increased by $316 million, or 28 percent, to $1.4 billion as of December 31, 2025.

•
Core deposits (which includes noninterest-bearing demand and interest-bearing demand, savings and money market accounts) represent 94 percent of total deposits at December 31, 2025.

•
Book value per share increased 9 percent to $37.49 at December 31, 2025 from $34.45 at December 31, 2024.

•
The Company and the Bank’s capital ratios at December 31, 2025 remain well above regulatory well capitalized standards.

31

EARNINGS SUMMARY: The following table presents certain key aspects of our performance for the years ended December 31, 2025, 2024 and 2023.

At or for the Years Ended December 31,

Change

(Dollars in thousands, except share and per share data)

2025

2024

2023

2025 vs

2024

2024 vs

2023

Results of Operations:

Interest income

$

362,525

$

327,801

$

304,010

$

34,724

$

23,791

Interest expense

161,615

178,795

147,921

(17,180

)

30,874

Net interest income

200,910

149,006

156,089

51,904

(7,083

)

Provision for credit losses

23,518

7,500

14,091

16,018

(6,591

)

Net interest income after provision for

   credit losses

177,392

141,506

141,998

35,886

(492

)

Wealth management fee income

63,240

61,458

55,747

1,782

5,711

Other income

18,845

17,664

17,831

1,181

(167

)

Total operating expense

207,168

175,676

148,295

31,492

27,381

Income before income tax expense

52,309

44,952

67,281

7,357

(22,329

)

Income tax expense

14,983

11,964

18,427

3,019

(6,463

)

Net income

$

37,326

$

32,988

$

48,854

$

4,338

$

(15,866

)

Per Share Data:

Basic earnings per common share

$

2.12

$

1.87

$

2.74

$

0.25

$

(0.87

)

Diluted earnings per common share

2.10

1.85

2.71

0.25

(0.86

)

Cash dividends declared

0.20

0.20

0.20

—

—

Book value end-of-period

37.49

34.45

32.90

3.04

1.55

Average common shares outstanding

17,612,244

17,664,640

17,849,558

(52,396

)

(184,918

)

Common stock equivalents (dilutive)

137,635

175,121

199,494

(37,486

)

(24,373

)

Diluted average common shares outstanding

17,749,879

17,839,761

18,049,052

(89,882

)

(209,291

)

Average equity to average assets

8.70

%

8.97

%

8.70

%

(0.27

)%

0.27

%

Return on average assets

0.52

0.50

0.76

0.02

(0.26

)

Return on average equity

5.95

5.61

8.77

0.34

(3.16

)

Dividend payout ratio (A)

9.43

10.70

7.28

(1.27

)

3.42

Net interest margin (B)

2.84

2.32

2.48

0.52

(0.16

)

Noninterest expenses to average assets

2.87

2.68

2.32

0.19

0.36

Noninterest income to average assets

1.14

1.21

1.15

(0.07

)

0.06

Balance sheet data (at period end):

Total assets

$

7,526,409

$

7,011,238

$

6,476,857

$

515,171

$

534,381

Securities held to maturity

95,862

101,635

107,755

(5,773

)

(6,120

)

Securities available to sale

774,203

784,544

550,617

(10,341

)

233,927

Total loans

6,253,736

5,512,326

5,429,325

741,410

83,001

Allowance for credit losses

71,039

72,992

65,888

(1,953

)

7,104

Total deposits

6,588,979

6,129,022

5,274,114

459,957

854,908

Total shareholders’ equity

658,206

605,849

583,681

52,357

22,168

Cash dividends:

   Common

3,521

3,530

3,558

(9

)

(28

)

Assets under management and/or

   administration (market value)

$ 13.1 billion

$ 11.9 billion

$ 10.9 billion

$ 1.2 billion

$ 1.0 billion

32

At or for the Years Ended December 31,

Change

2025

2024

2023

2025 vs

2024

2024 vs

2023

Asset quality ratios (at period end):

Nonperforming loans to total loans

1.09

%

1.82

%

1.13

%

(0.73

)%

0.69

%

Nonperforming assets to total assets

0.91

1.43

0.95

(0.52

)

0.48

Allowance for credit losses to nonperforming loans

104.10

72.87

107.44

31.23

(34.57

)

Allowance for credit losses to total loans

1.14

1.32

1.21

(0.18

)

0.11

Net charge-offs to average loans plus other real estate owned

0.44

0.01

0.17

0.43

(0.16

)

Liquidity and capital ratios:

Average loans to average deposits

92.10

%

94.14

%

102.29

%

(2.04

)%

(8.15

)%

Total shareholders’ equity to total assets

8.75

8.64

9.01

0.11

(0.37

)

Selected Balance Sheet Ratios of the

   Company:

Regulatory total capital to risk-weighted assets

12.68

%

14.84

%

14.95

%

(2.16

)%

(0.11

)%

Regulatory leverage ratio

8.87

9.01

9.19

(0.14

)

(0.18

)

Noninterest-bearing deposits to total deposits

21.68

18.16

18.16

3.52

(0.00

)

Time deposits to total deposits

6.20

8.01

10.85

(1.81

)

(2.84

)

(A) Dividend payout ratio is calculated by dividing cash dividends by net income.

(B) Net interest income on a fully tax equivalent basis, using a 21 percent federal income tax rate, as a percentage of total average interest-earning assets.

2025 compared to 2024

The Company recorded net income of $37.3 million and diluted earnings per share of $2.10 for the year ended December 31, 2025, compared to net income of $33.0 million and diluted earnings per share of $1.85 for the year ended December 31, 2024. These results produced a return on average assets of 0.52 percent and 0.50 percent for 2025 and 2024, respectively, and a return on average shareholders’ equity of 5.95 percent and 5.61 percent for 2025 and 2024, respectively.

The increase in net income for 2025 was principally driven by increased net interest income partially offset by increased provision for credit losses and increased operating expenses, which was principally attributable to the expansion of our private banking model that offers a single point of contact for all banking services into the metro New York City market. This strategy and metro New York City expansion continues to deliver lower-cost core deposit relationships resulting in consistent improvement in our cost of funds and net interest margin. During 2025, deposits grew $460.0 million, which included $316.0 million in noninterest-bearing demand deposits.

NET INTEREST INCOME AND NET INTEREST MARGIN

The primary source of the Company’s operating income is net interest income, which is the difference between interest and dividends earned on interest-earning assets and interest paid on interest-bearing liabilities. Interest-earning assets include loans, investment securities, interest-earning deposits and federal funds sold. Interest-bearing liabilities include interest-bearing checking, savings and time deposits, Federal Home Loan Bank advances, subordinated debt and other borrowings. Net interest income is determined by the difference between the average yields earned on interest-earning assets and the average cost of interest-bearing liabilities (“net interest spread”) and the relative amounts of interest-earning assets and interest-bearing liabilities. Net interest margin ("NIM") is calculated as net interest income as a percent of total interest-earning assets. The Company’s net interest income, spread and margin are affected by regulatory, economic and competitive factors that influence interest rates, loan demand and deposit flows and levels of nonperforming assets.

33

The following table compares the average balance sheets, interest rate spreads and net interest margins for the years ended December 31, 2025, 2024 and 2023 (on a fully tax-equivalent basis "FTE"):

Year Ended December 31, 2025

Average

Income/Expense

Yield

(Dollars in thousands)

Balance

(FTE)

(FTE)

Assets:

Interest-earnings assets:

Investments:

Taxable (A)

$

997,712

$

31,513

3.16

%

Tax-exempt (A)(B)

—

—

—

Loans (B)(C):

Mortgages

638,855

28,615

4.48

Commercial mortgages

2,448,097

111,744

4.56

Commercial

2,559,260

167,998

6.56

Commercial construction

63

5

7.94

Installment

146,553

10,036

6.85

Home Equity

52,068

3,851

7.40

Other

376

20

5.40

Total loans

5,845,272

322,269

5.51

Federal funds sold

—

—

—

Interest-earning deposits

262,985

9,684

3.68

Total interest-earning assets

7,105,969

363,466

5.11

%

Noninterest-earning assets:

Cash and due from banks

9,335

Allowance for loan losses

(75,515

)

Premises and equipment

35,358

Other assets

132,386

Total noninterest-earning assets

101,564

Total assets

$

7,207,533

Liabilities and shareholders’ equity:

Interest-bearing deposits:

Checking

$

3,573,710

$

113,543

3.18

%

Money markets

999,858

27,470

2.75

Savings

104,744

616

0.59

Certificates of deposit - retail and listing service

433,633

14,970

3.45

Subtotal interest-bearing deposits

5,111,945

156,599

3.06

Interest-bearing demand - brokered

4,740

210

4.43

Certificates of deposit - brokered

—

—

—

Total interest-bearing deposits

5,116,685

156,809

3.06

Borrowed funds

12,067

543

4.50

Finance lease liability

1,262

53

4.20

Subordinated debt

105,781

4,210

3.98

Total interest-bearing liabilities

5,235,795

161,615

3.09

%

Noninterest-bearing liabilities:

Demand deposits

1,229,755

Accrued expenses and other liabilities

114,613

Total noninterest-bearing liabilities

1,344,368

Shareholders’ equity

627,370

Total liabilities and shareholders’ equity

$

7,207,533

Net interest income

$

201,851

Net interest spread

2.02

%

Net interest margin (D)

2.84

%

(A)
Average balances for available for sale securities are based on amortized cost.

(B)
Interest income is presented on a tax-equivalent basis using a 21 percent federal income tax rate.

(C)
Loans are stated net of unearned income and include nonaccrual loans.

(D)
Net interest income on an FTE basis as a percentage of total average interest-earning assets.

34

Year Ended December 31, 2024

Average

Income/Expense

Yield

(Dollars in thousands)

Balance

(FTE)

(FTE)

Assets:

Interest-earnings assets:

Investments:

Taxable (A)

$

849,933

$

23,402

2.75

%

Tax-exempt (A)(B)

—

—

—

Loans (B)(C):

Mortgages

582,024

23,017

3.95

Commercial mortgages

2,406,726

107,659

4.47

Commercial

2,216,401

151,610

6.84

Commercial construction

18,647

1,570

8.42

Installment

70,852

4,814

6.79

Home Equity

38,321

3,113

8.12

Other

246

25

10.16

Total loans

5,333,217

291,808

5.47

Federal funds sold

—

—

—

Interest-earning deposits

297,448

13,644

4.59

Total interest-earning assets

6,480,598

328,854

5.07

%

Noninterest-earning assets:

Cash and due from banks

8,517

Allowance for loan losses

(69,372

)

Premises and equipment

25,705

Other assets

110,938

Total noninterest-earning assets

75,788

Total assets

$

6,556,386

Liabilities and shareholders’ equity:

Interest-bearing deposits:

Checking

$

3,149,550

$

118,497

3.76

%

Money markets

842,606

24,851

2.95

Savings

105,351

410

0.39

Certificates of deposit - retail and listing service

500,842

20,984

4.19

Subtotal interest-bearing deposits

4,598,349

164,742

3.58

Interest-bearing demand - brokered

10,000

522

5.22

Certificates of deposit - brokered

58,425

2,950

5.05

Total interest-bearing deposits

4,666,774

168,214

3.60

Borrowed funds

65,299

3,848

5.89

Finance lease liability

2,207

89

4.03

Subordinated debt

133,413

6,644

4.98

Total interest-bearing liabilities

4,867,693

178,795

3.67

%

Noninterest-bearing liabilities:

Demand deposits

998,497

Accrued expenses and other liabilities

102,197

Total noninterest-bearing liabilities

1,100,694

Shareholders’ equity

587,999

Total liabilities and shareholders’ equity

$

6,556,386

Net interest income

$

150,059

Net interest spread

1.40

%

Net interest margin (D)

2.32

%

(A)
Average balances for available for sale securities are based on amortized cost.

(B)
Interest income is presented on a tax-equivalent basis using a 21 percent federal income tax rate.

(C)
Loans are stated net of unearned income and include nonaccrual loans.

(D)
Net interest income on an FTE basis as a percentage of total average interest-earning assets.

35

Year Ended December 31, 2023

Average

Income/Expense

Yield

(Dollars in thousands)

Balance

(FTE)

(FTE)

Assets:

Interest-earnings assets:

Investments:

Taxable (A)

$

800,811

$

19,743

2.47

%

Tax-exempt (A)(B)

1,251

50

4.00

Loans (B)(C):

Mortgages

562,488

19,733

3.51

Commercial mortgages

2,494,427

108,819

4.36

Commercial

2,254,617

144,141

6.39

Commercial construction

10,115

918

9.08

Installment

51,929

3,454

6.65

Home Equity

34,332

2,624

7.64

Other

257

29

11.28

Total loans

5,408,165

279,718

5.17

Federal funds sold

—

—

—

Interest-earning deposits

146,977

6,075

4.13

Total interest-earning assets

6,357,204

305,586

4.81

%

Noninterest-earning assets:

Cash and due from banks

8,973

Allowance for loan losses

(64,149

)

Premises and equipment

23,986

Other assets

79,192

Total noninterest-earning assets

48,002

Total assets

$

6,405,206

Liabilities and shareholders’ equity:

Interest-bearing deposits:

Checking

$

2,777,390

$

88,829

3.20

%

Money markets

862,686

18,432

2.14

Savings

124,538

229

0.18

Certificates of deposit - retail and listing service

400,155

11,736

2.93

Subtotal interest-bearing deposits

4,164,769

119,226

2.86

Interest-bearing demand – brokered

13,973

611

4.37

Certificates of deposit – brokered

67,998

3,038

4.47

Total interest-bearing deposits

4,246,740

122,875

2.89

Borrowed funds

337,777

18,204

5.39

Finance lease liability

4,018

191

4.75

Subordinated debt

133,127

6,651

5.00

Total interest-bearing liabilities

4,721,662

147,921

3.13

%

Noninterest-bearing liabilities:

Demand deposits

1,040,403

Accrued expenses and other liabilities

86,193

Total noninterest-bearing liabilities

1,126,596

Shareholders’ equity

556,948

Total liabilities and shareholders’ equity

$

6,405,206

Net interest income

$

157,665

Net interest spread

1.68

%

Net interest margin (D)

2.48

%

(A)
Average balances for available for sale securities are based on amortized cost.

(B)
Interest income is presented on a tax-equivalent basis using a 21 percent federal income tax rate.

(C)
Loans are stated net of unearned income and include nonaccrual loans.

(D)
Net interest income on an FTE basis as a percentage of total average interest-earning assets.

36

The effect of volume and rate changes on net interest income (on an FTE basis) for the periods indicated are shown below:

Year Ended 2025 Compared with 2024

Year Ended 2024 Compared with 2023

Net

Net

Difference due to

Change In

Change In

Change In

Change In:

Income/

Income/

Income/

(In Thousands):

Volume

Rate

Expense

Volume

Rate

Expense

ASSETS:

Investments

$

5,178

$

2,933

$

8,111

$

1,084

$

2,526

$

3,610

Loans

33,077

(2,616

)

30,461

(2,854

)

14,944

12,090

Federal funds sold

—

—

—

—

—

—

Interest-earning deposits

(1,461

)

(2,499

)

(3,960

)

6,826

743

7,569

Total interest income

$

36,794

$

(2,182

)

$

34,612

$

5,056

$

18,213

$

23,269

LIABILITIES:

Checking

$

15,333

$

(20,287

)

$

(4,954

)

$

13,624

$

16,044

$

29,668

Money market

5,690

(3,071

)

2,619

747

5,672

6,419

Savings

(2

)

208

206

(40

)

221

181

Certificates of deposit - retail

(2,597

)

(3,417

)

(6,014

)

3,414

5,834

9,248

Certificates of deposit - brokered

(1,475

)

(1,475

)

(2,950

)

(457

)

369

(88

)

Interest bearing demand brokered

(242

)

(70

)

(312

)

(193

)

104

(89

)

Borrowed funds

(2,563

)

(742

)

(3,305

)

(15,782

)

1,426

(14,356

)

Finance lease liability

(40

)

4

(36

)

(76

)

(26

)

(102

)

Subordinated debt

(1,236

)

(1,198

)

(2,434

)

16

(23

)

(7

)

Total interest expense

$

12,868

$

(30,048

)

$

(17,180

)

$

1,253

$

29,621

$

30,874

Net interest income

$

23,926

$

27,866

$

51,792

$

3,803

$

(11,408

)

$

(7,605

)

2025 compared to 2024

Net interest income, on a fully tax-equivalent basis, increased $51.8 million, or 35 percent, in 2025 to $201.9 million compared to $150.1 million in 2024. The net interest margin ("NIM") was 2.84 percent and 2.32 percent for the years ended December 31, 2025 and 2024, respectively, an increase of 52 basis points year over year. Net interest income, on a fully tax-equivalent basis, and NIM improved primarily due to continued growth in lower-costing client deposit relationships, which were used to fund loan production and investment purchases and allowed less reliance on higher-costing deposit balances and borrowed funds. The Bank also benefited from the 175 basis-point reduction in the target federal funds rate by the Federal Reserve from the latter half of 2024 through 2025, which lowered deposit costs and supported margin expansion.

The average balance of interest-earning assets increased by $625.4 million to $7.11 billion at December 31, 2025 compared to $6.48 billion at 2024. The increase was predominately driven by growth in the average balance of loans of $512.1 million, and investments of $147.8 million, partially offset by a decline in the average balance of interest earnings deposits of $34.5 million.

The increase in average balance of loans was primarily driven by an increase in commercial loans, residential and commercial mortgages, and installment loans, offset slightly by a decline in commercial construction. The average balance of commercial loans increased by $342.9 million to $2.56 billion in 2025 compared to $2.22 billion in 2024. The average balances of residential mortgages grew $56.8 million to $638.9 million for the year ended December 31, 2025 from $582.0 million in 2024. The average balances of commercial mortgages grew $41.4 million to $2.45 billion in 2025 compared to $2.41 billion in 2024. Additionally, the average balance of installment loans increased by $75.7 million to $146.6 million in 2025 as compared to $70.9 million in 2024. The increase in the average balance of loans was primarily a result of increasing loan demand from customers due to a lower interest rate environment, our expansion into the metro New York region and improving economic conditions.

Interest-earning deposits are an additional part of the Company's liquidity and interest rate risk management strategies. The combined average balance of these investments during the year ended December 31, 2025 was $263.0 million with an average yield of 3.68 percent as compared to $297.4 million and an average yield of 4.59 percent for 2024. The decrease reflected cash used to fund loan originations and investment purchases. The decrease in the rate reflected the lower interest rate environment.

37

The average yields earned on interest-earning assets for 2025 remained stable when comparing to 2024. The yield on interest-earning assets increased four basis points to 5.11 percent for the year ended December 31, 2025, when compared to 2024.

The increase in the average yield on total investments for the year ended December 31, 2025 compared to 2024 reflected purchases of higher-yielding securities in 2024 and 2025. The average yield on investments increased by 41 basis points to 3.16 percent for the year ended December 31, 2025 as compared to 2.75 percent for 2024.

The average yield on total loans for 2025 remained stable up four basis points to 5.51 percent for 2025 when compared to 5.47 percent for 2024. The average yield on residential mortgages increased 53 basis points to 4.48 percent for the year ended December 31, 2025, when compared to 3.95 percent for 2024. The average yield on commercial mortgages increased nine basis points to 4.56 percent for the year ended December 31, 2025, when compared to 2024. Mortgage-related yields rose in 2025 despite Federal Funds rate cuts, as rates remained elevated at the longer end of the yield curve, along with more seasoned lower-coupon mortgages being replaced with higher-yielding originations. The yield on commercial loans for the year ended December 31, 2025 decreased 28 basis points to 6.56 percent from 6.84 percent for the year ended December 31, 2024. The average yield on commercial loans decreased for 2025 due to a decrease in the target Federal Funds rate of 175 basis points from the second half of 2024 through December 31, 2025, which had a greater impact on these loans, which are typically floating rates with short repricing periods. As of December 31, 2025, 30 percent of all loans will reprice within one month, 35 percent within three months and 51 percent within one year.

The average balance of interest-bearing liabilities totaled $5.24 billion for 2025 representing an increase of $368.1 million, or 8 percent, from $4.87 billion in 2024. The increase in interest-bearing liabilities was primarily due to an increase in the average balance of interest-bearing deposits of $449.9 million to $5.12 billion in 2025 from $4.67 billion in 2024. This increase was partially offset by a decrease in overnight borrowings of $53.2 million to $12.1 million in 2025 from $65.3 million in 2024 and a decrease in subordinated debt of $27.6 million to $105.8 million in 2025 from $133.4 million in 2024.

The increase in the average balance of interest-bearing deposits was primarily due to an increase in the average balance of interest-bearing checking accounts of $424.2 million to $3.57 billion and money markets of $157.3 million to $999.9 million, partially offset by a decrease in the average balance of certificates of deposit of $67.2 million in 2025. The increase in interest-bearing checking deposits was principally attributable to our continued expansion into the metro New York region and client demand for FDIC insured products, which we can offer through a reciprocal deposit program. Our expansion into the metro New York market has allowed us to grow lower-cost, relationship deposits, while reducing the Company's reliance on overnight borrowings, brokered deposits and other high-cost funding sources.

The decrease in the average balance of borrowings from $65.3 million to $12.1 million for 2025 was driven by the growth in client deposits led by the Company's expansion into New York City, which were used to pay down borrowings.

For the years ended December 31, 2025 and 2024, the cost of interest-bearing liabilities was 3.09 percent and 3.67 percent, respectively, reflecting a decrease of 58 basis points. The decrease was driven by a decrease in the average cost of interest-bearing deposits of 54 basis points to 3.06 percent for 2025 and a decrease in the average cost of certificates of deposit of 74 basis points to 3.45 percent for 2025. The Company also benefited from lower short-term borrowing costs for the year ended December 31, 2025, which decreased by 139 basis points to 4.50 percent when compared to 5.89 percent for the same period in 2024. The decrease in deposit and borrowing rates was due to the Federal Reserve lowering the target Federal Funds rate by 175 basis points during the latter half of 2024 through the end of 2025, and a change in the composition of the deposit portfolio with a greater concentration of lower-cost core relationship deposits.

INVESTMENT SECURITIES: Investment securities classified as held to maturity are those securities that the Company has both the ability and intent to hold to maturity. These securities are carried at amortized cost. Investment securities classified as available for sale are purchased, sold and/or maintained as a part of the Company’s overall balance sheet, liquidity and interest rate risk management strategies, and in response to changes in interest rates, liquidity needs, prepayment speeds and/or other factors. These securities are carried at estimated fair value, and unrealized changes in fair value are recognized as a separate component of shareholders’ equity, net of income taxes. Realized gains and losses are recognized in income at the time the securities are sold. Equity securities are carried at fair value with unrealized gains and losses recorded in non-interest income as incurred.

At December 31, 2025, the Company had investment securities held to maturity with an amortized cost of $95.9 million and an estimated fair value of $87.5 million compared with an amortized cost of $101.6 million and an estimated fair value of $88.7 million at December 31, 2024.

38

At December 31, 2025, the Company had investment securities available for sale with an estimated fair value of $774.2 million compared with $784.5 million at December 31, 2024. A net unrealized loss (net of income tax) of $49.3 million and $72.1 million related to these securities were included in shareholders’ equity at December 31, 2025 and 2024, respectively.

The Company had one equity security (a CRA investment security) with a fair value of $13.5 million and $13.0 million at December 31, 2025 and 2024, respectively, with changes in fair value recognized in the Consolidated Statements of Income. The Company recorded an unrealized gain of $418,000 for the year ended December 31, 2025, as compared to a $125,000 unrealized loss for the year ended December 31, 2024. Additionally, the Company sold its Visa B shares, which resulted in a positive fair value adjustment to equity securities of $953,000 recognized in the Consolidated Statements of Income during the year ended December 31, 2024.

The amortized cost and fair value of investment securities held to maturity and available for sale at December 31, 2025, 2024 and 2023 are shown below:

2025

2024

2023

(In thousands)

Amortized Cost

Estimated Fair Value

Amortized Cost

Estimated Fair Value

Amortized Cost

Estimated Fair Value

Investment securities - held to maturity:

  U.S. government-sponsored

    agencies

$

40,000

$

38,875

$

40,000

$

37,334

$

40,000

$

36,631

  Mortgage-backed securities-residential (principally

    U.S. government-sponsored entities)

55,862

48,616

61,635

51,316

67,755

57,784

  Total investment securities -

     held to maturity

$

95,862

$

87,491

$

101,635

$

88,650

$

107,755

$

94,415

Investment securities - available for sale:

  U.S. government-sponsored

    agencies

$

244,833

$

211,223

$

244,813

$

196,914

$

244,794

$

197,691

  Mortgage-backed securities-residential (principally

     U.S. government-sponsored entities)

561,794

530,365

595,789

548,612

363,893

320,796

  SBA pool securities

19,345

17,212

27,772

24,482

27,148

23,404

  Corporate bond

15,500

15,403

15,500

14,536

10,000

8,726

  Total investment securities -

    available for sale

$

841,472

$

774,203

$

883,874

$

784,544

$

645,835

$

550,617

Total investment securities

$

937,334

$

861,694

$

985,509

$

873,194

$

753,590

$

645,032

39

The following table presents the contractual maturities and yields of debt securities held to maturity and available for sale as of December 31, 2025. The weighted average yield is a computation of income within each maturity range based on the amortized cost of securities:

After 1

After 5

But

But

After

Within

Within

Within

10

(Dollars in thousands)

1 Year

5 Years

10 Years

Years

Total

Investment securities - held to maturity:

   U.S. government-sponsored agencies

$

15,000

$

25,000

$

—

$

—

$

40,000

1.35

%

1.64

%

—

%

—

%

1.53

%

   Mortgage-backed securities-

$

—

$

—

$

—

$

55,862

$

55,862

      residential (A)

—

%

—

%

—

%

2.15

%

2.15

%

Total investment securities - held to maturity

$

15,000

$

25,000

$

—

$

55,862

$

95,862

1.35

%

1.64

%

—

%

2.15

%

1.89

%

Investment securities - available for sale:

   U.S. government-sponsored agencies

$

—

$

78,020

$

88,930

$

44,273

$

211,223

—

%

1.34

%

1.63

%

1.76

%

1.56

%

   Mortgage-backed securities-

$

50,079

$

8,589

$

10,262

$

461,435

$

530,365

      residential (A)

4.57

%

2.29

%

1.62

%

3.88

%

3.87

%

   SBA pool securities

$

—

$

1,575

$

9,012

$

6,625

$

17,212

—

%

3.26

%

1.85

%

1.19

%

1.69

%

   Corporate bond

$

—

$

—

$

15,403

$

—

$

15,403

—

%

—

%

6.32

%

—

%

6.32

%

Total investment securities - available for sale

$

50,079

$

88,184

$

123,607

$

512,333

$

774,203

4.57

%

1.46

%

2.16

%

3.63

%

3.19

%

Total investment securities

$

65,079

$

113,184

$

123,607

$

568,195

$

870,065

3.83

%

1.50

%

2.16

%

3.49

%

3.05

%

(A)
Shown using stated final maturity

LOANS: The loan portfolio represents the largest portion of the Company’s interest-earning assets and is the primary source of interest income. Loans are primarily originated in New Jersey and the boroughs of New York City and, to a lesser extent, Pennsylvania. The Company also offers equipment financing loan and leases that are originated nationally. As of December 31, 2025, 44 percent of the total loan portfolio consisted of C&I loans (including equipment financing), 30 percent of multifamily loans, 12 percent of commercial mortgages and 10 percent of residential mortgages.

Total loans were $6.3 billion and $5.5 billion at December 31, 2025 and 2024, respectively, an increase of $741.4 million, over the previous year. Residential loans increased $32.9 million to $647.8 million at December 31, 2025 from $614.8 million at December 31, 2024. Multifamily mortgage loans were $1.9 billion at December 31, 2025, an increase of $62.8 million, or 3 percent, when compared to $1.8 billion at December 31, 2024. During 2025, commercial mortgages increased $186.3 million to $774.4 million when compared to $588.1 million at December 31, 2024. The increase in commercial mortgages was bolstered by our focus on attracting clients that bring a full relationship to the Bank coupled with improved lender liquidity. Commercial loans, which includes equipment financing, totaled $2.7 billion at December 31, 2025. This was an increase of $332.3 million, or 14 percent, when compared to December 31, 2024. Commercial loan growth was driven by business expansion and capital investment.

The Company originates loans that are partially guaranteed by the SBA, to provide working capital and/or, finance the purchase of equipment, inventory or commercial real estate and that could be used for start-up and smaller businesses. All SBA loans are underwritten and documented as prescribed by the SBA. The Company generally sells the guaranteed portion of the SBA loans in the secondary market, with the non-guaranteed portion held in the loan portfolio. During 2025, the Bank sold $19.2 million of the guaranteed portion of SBA loans into the secondary market. As of December 31, 2025, the balance of the non-guaranteed portion of SBA loans held on our balance sheet totaled $36.7 million, which, and was included in commercial loans.

40

The following table presents the contractual repayments of the loan portfolio, by loan type, at December 31, 2025:

After 5 But

Within

After 1 But

Within

After

(In thousands)

One Year

Within 5 Years

15 Years

15 Years

Total

Residential mortgage

$

7,732

$

20,529

$

58,897

$

560,608

$

647,766

Commercial mortgage (including multifamily)

244,357

955,614

1,402,171

34,878

2,637,020

Commercial loans (including equipment financing)

565,863

1,427,269

663,256

65,059

2,721,447

Commercial construction

—

—

495

—

495

Home equity lines of credit

603

—

1,559

57,144

59,306

Consumer and other loans

395

48,284

99,637

39,386

187,702

Total loans

$

818,950

$

2,451,696

$

2,226,015

$

757,075

$

6,253,736

The following table presents the loans, by loan type, that have a fixed interest rate and an adjustable interest rate due after one year:

Fixed

Adjustable

(In thousands)

Interest Rate

Interest Rate

Residential mortgage

$

634,675

$

5,359

Commercial mortgage (including multifamily)

1,994,878

397,785

Commercial loans (including equipment financing)

1,215,160

940,424

Commercial construction

495

—

Home equity lines of credit

—

58,703

Consumer and other loans

103,520

83,787

Total loans

$

3,948,728

$

1,486,058

The Company has not made nor invested in subprime loans or “Alt-A” type mortgages.

The geographic breakdown of the multifamily portfolio, net of participated multifamily loans, at December 31, 2025 was as follows:

(Dollars in thousands)

New York

$

1,014,476

55

%

New Jersey

582,207

31

Pennsylvania

206,637

11

Other

59,272

3

Total Multifamily

$

1,862,592

100

%

A further breakdown of the multifamily portfolio by county within each respective State was as follows:

New Jersey

New York

Pennsylvania

Essex County

26

%

Bronx County

42

%

Philadelphia County

57

%

Hudson County

24

Kings County

26

Lehigh County

15

Union County

20

New York County

20

York County

12

Bergen County

10

Westchester County

4

Lycoming County

4

Morris County

8

Queens County

4

Bucks County

3

Monmouth County

3

All other NY counties

4

All other PA counties

9

All other NJ counties

9

Total

100

%

Total

100

%

Total

100

%

41

Principal types of owner occupied commercial real estate properties (by Call Report code), included in commercial mortgage loans on the balance sheet, at December 31, 2025 were:

(Dollars in thousands)

Industrial (including Warehouse)

$

87,818

30

%

Office Buildings/Office Condominiums

64,693

22

Retail Buildings/Shopping Centers

39,126

14

Medical Offices

23,885

8

Other Owner Occupied CRE Properties

74,279

26

Total Owner Occupied CRE Loans

$

289,801

100

%

Principal types of non-owner occupied commercial real estate properties (by Call Report code), at December 31, 2025 were as follows. These loans are included in commercial mortgage loans and commercial loans on the Company’s balance sheet.

(Dollars in thousands)

Retail Buildings/Shopping Centers

$

289,507

26

%

Healthcare

227,535

21

Office Buildings/Office Condominiums

165,954

15

Mixed Use (Commercial/Residential)

106,145

10

Hotels and Hospitality

84,202

8

Medical Offices

73,011

7

Industrial (including Warehouse)

50,252

4

Mixed Use (Retail/Office)

45,859

4

Other Non-Owner Occupied CRE Properties

58,617

5

Total Non-Owner Occupied CRE Loans

$

1,101,082

100

%

At December 31, 2025 and 2024, the Bank had a concentration in commercial real estate loans as defined by applicable regulatory guidance. The following table presents such concentration levels at December 31, 2025 and 2024:

As of December 31,

2025

2024

Multifamily mortgage loans as a percent of total regulatory capital of the Bank

231

%

225

%

Non-owner occupied commercial real estate loans as a percent of

   total regulatory capital of the Bank

136

122

Total CRE concentration

367

%

347

%

The CRE concentration as a percentage of regulatory capital is monitored by Management. Management believes it satisfactorily addresses the key elements in the risk management framework laid out by its regulators for the effective management of CRE concentration risks.

GOODWILL: At both December 31, 2025 and 2024, goodwill was $36.2 million, primarily as a result of the acquisition of registered investment advisors related to the Company's Wealth Management Division. The Bank currently intends to continue to grow its wealth management business through growth in existing relationships, attraction of new clients and acquisitions. Future acquisitions could result in additional goodwill.

42

DEPOSITS: The following table sets forth the details of total deposits as of December 31:

(Dollars in thousands)

2025

2024

Noninterest-bearing demand deposits

$

1,428,745

21.68

%

$

1,112,734

18.16

%

Interest-bearing checking

3,448,497

52.34

3,334,269

54.40

Savings

105,123

1.59

103,136

1.68

Money market

1,197,995

18.18

1,078,024

17.59

Certificates of deposit - retail

408,219

6.20

483,998

7.90

Certificates of deposit - listing service

400

0.01

6,861

0.11

Subtotal deposits

6,588,979

100.00

6,119,022

99.84

Interest-bearing demand - Brokered

—

—

10,000

0.16

Total deposits

$

6,588,979

100.00

%

$

6,129,022

100.00

%

At December 31, 2025 and 2024, the Company reported total deposits of $6.6 billion and $6.1 billion, an increase of $460.0 million, or 8 percent. The Company’s strategy is to fund a majority of its loan growth with core deposits, which is an important factor in the generation of net interest income. The increase in deposits was primarily due to increases of $316.0 million in noninterest-bearing demand deposits, $114.2 million in interest-bearing checking and $120.0 million in money market deposits. The growth in new client relationships was due to our continued expansion into the metro New York City market; client demand for FDIC insured products offered through our reciprocal deposit program; a focus on providing high-touch client service; and a full array of treasury management products that support core deposit growth. The Company has also successfully focused on:

•
Growth in deposits associated with its private banking relationships and

•
Business and personal core deposit generation, particularly noninterest-bearing checking accounts.

The Company is a participant in the Reich & Tang demand Deposit Marketplace ("DDM") program and the Promontory Program. The Company uses these deposit sweep services to place customer funds into interest-bearing demand (checking) accounts at other participating banks. Customer funds are placed at one or more participating banks to ensure that each deposit customer is eligible for the full amount of FDIC insurance. As a participant, the Company receives an equal amount of reciprocal deposits from other participating banks. Such average reciprocal deposit balances were $1.92 billion and $1.31 billion for 2025 and 2024, respectively.

At December 31, 2025, uninsured/unprotected deposits were approximately $1.90 billion, or 29 percent of total deposits. This amount was adjusted to exclude $317 million of public fund deposit balances, which are fully-collateralized by securities and an FHLBNY letter of credit. The Company continues to leverage interest rate swaps to extend the duration to the matched deposits. At December 31, 2025, the Company had transacted pay fixed, receive floating interest rate swaps totaling $305.0 million in notional amount.

The following table sets forth information concerning the composition of the Company’s average balance of deposits and average interest rates paid for the following years:

(Dollars in thousands)

2025

2024

2023

Noninterest-bearing demand

$

1,229,755

—

%

$

998,497

—

%

$

1,040,403

—

%

Checking

3,573,710

3.18

3,149,550

3.76

2,777,390

3.20

Savings

104,744

0.59

105,351

0.39

124,538

0.18

Money markets

999,858

2.75

842,606

2.95

862,686

2.14

Certificates of deposit - retail and listing

   service

433,633

3.45

500,842

4.19

400,155

2.93

Interest-bearing demand - brokered

4,740

4.43

10,000

5.22

13,973

4.37

Certificates of deposit - brokered

—

—

58,425

5.05

67,998

4.47

Total deposits

$

6,346,440

2.47

%

$

5,665,271

2.97

%

$

5,287,143

2.32

%

At December 31, 2025, the Company carried $ 1.90 billion in deposits that exceed the FDIC insurance limit of $250,000. At December 31, 2025, we had no deposits that were uninsured for any reason other than being in excess of the maximum amount for federal deposit insurance.

43

The following table shows the maturity for certificates of deposit of $250,000 or more as of December 31, 2025 (in thousands):

Three months or less

$

35,814

Over three months through six months

67,666

Over six months through year

29,943

Over year

4,648

Total

$

138,071

FEDERAL HOME LOAN BANK ADVANCES AND OTHER BORROWINGS: As part of our overall funding and liquidity management program, from time to time we borrow from the Federal Home Loan Bank (the "FHLB").

As of December 31,

(Dollars in thousands)

2025

2024

2023

Amount outstanding at end of the year

$

73,267

$

—

$

403,814

Weighted average interest rate end of the year

3.96

%

—

%

5.62

%

Average daily balance during the year

$

12,067

$

65,299

$

337,777

Weighted average interest rate during the year

4.50

%

5.89

%

5.39

%

Maximum month-end balance during the year

$

89,048

$

401,655

$

541,796

The Company had $73.3 million of overnight borrowings at the FHLB at a rate of 3.96 percent at December 31, 2025. At December 31, 2024, the Company had no overnight borrowings. The Company had $403.8 million of overnight borrowings at the FHLB at a rate of 5.62 percent at December 31, 2023.

At December 31, 2025, unused short-term or overnight borrowing commitments totaled $1.70 billion from the FHLB, $15.0 million from correspondent banks and $2.47 billion from the Federal Reserve Bank.

SUBORDINATED DEBT: In December 2017, the Company issued $35.0 million in aggregate principal amount of fixed-to-floating subordinated notes (the “2017 Notes”) to certain institutional investors. The 2017 Notes had a stated maturity of December 15, 2027, and an interest rate reset quarterly to a level equal to the then current three-month LIBOR rate plus 254 basis points, payable quarterly in arrears (which was 7.75 percent at December 31, 2024). The Company fully redeemed these notes plus $627,000 in unpaid interest on March 15, 2025. The remaining net issuance costs of $259,000 were written-off during the quarter ended March 31, 2025.

In December 2020, the Company issued $100.0 million in aggregate principal amount of fixed to floating subordinated notes (the “2020 Notes”) to certain institutional investors. The 2020 Notes are non-callable for five years, have a stated maturity of December 22, 2030, and had a fixed rate of 3.50 percent per year until December 22, 2025. From December 23, 2025 to the maturity date or early redemption date, the interest rate will reset quarterly to a level equal to the then current three-month SOFR plus 326 basis points, payable quarterly in arrears (which was 6.93 percent at December 31, 2025). Debt issuance costs incurred totaled $1.9 million and are being amortized to maturity. The Company fully redeemed these notes, plus any accrued and unpaid interest on March 2, 2026.

Subordinated debt is presented net of issuance cost on the Consolidated Statements of Condition. The subordinated debt issuances are included in the Company’s regulatory total capital amount and ratio.

ALLOWANCE FOR CREDIT LOSSES AND RELATED PROVISION: The allowance for credit losses ("ACL") was $71.0 million at December 31, 2025 compared to $73.0 million at December 31, 2024. The decrease in the ACL was primarily due to charge-offs of $26.9 million and changes in the application of the methodology used to calculate the ACL, partially offset by a provision for credit losses of $23.6 million during 2025.

Charge-offs consisted of $13.9 million related to several C&I loans and $13.0 million related to five multifamily property credits that were resolved during 2025. A significant portion of the charge-offs were tied to previously established specific reserves. As those reserves were utilized, both the related loan balances and the previously allocated specific reserves declined, limiting their incremental impact on the overall ACL. The resolutions of these credits reduced portfolio uncertainty and concentration risk. The provision for credit losses of $23.6 million was driven by loan growth of $741.4 million and the establishment of $25.5 million in specific reserves on certain relationships.

44

At December 31, 2025, the ACL as a percentage of total loans outstanding was 1.14 percent compared to 1.32 percent at December 31, 2024. The decline in the ratio was driven by (i) the use of previously established specific reserves associated with the charge-offs noted above, (ii) strong loan growth during the year, which increased total loans outstanding, and (iii) the Company’s annual CECL model recalibration. The recalibration incorporated lower historical loss rates and reflected the current risk portfolio characteristics, resulting in a lower required general reserve.

Although charge-offs were higher in 2025, they were largely related to credits that had been previously identified and reserved and therefore did not represent a broad decline in overall portfolio credit quality. Credit metrics and risk rating trends across the remainder of the portfolio remained stable, and management's forward-looking economic assumptions at December 31, 2025 reflected a stable economic outlook.

Despite the lower ACL ratio, management believes the allowance for credit losses of $71.0 million, or 1.14 percent of total loans, appropriately reflects the current credit quality, portfolio composition, loan growth, and forward-looking economic conditions, and remains adequate to absorb expected credit losses as of December 31, 2025.

The provision for credit losses was $23.5 million for 2025, $7.5 million for 2024 and $14.1 million for 2023. Net charge-offs were significantly higher at $25.6 million, as compared to $392,000 for 2024, as the Company aggressively worked to reduce nonperforming asset balances in 2025. Net charge-offs for the year ended December 31, 2024 included $5.4 million in recoveries recorded on commercial loans in 2024.

In determining an appropriate amount for the allowance, the Bank segments and aggregates the loan portfolio based on common characteristics. The following segments have been identified:

a)
Primary Residential Mortgages. The Bank originates one- to four-family residential mortgage loans in the Tri-State area (New York, New Jersey and Connecticut), Pennsylvania and Florida. On a case-by-case basis, the Bank will lend in additional states. When reviewing residential mortgage loan applications, detailed verifiable information is gathered on income, assets, employment and a tri-merged credit report obtained from a credit repository that will determine total monthly debt obligations. Utilizing an independent appraisal from an approved appraisal management company, the Bank makes residential mortgage loans up to 80 percent of the appraised value. Maximum loan-to-value (“LTV”) is determined based on property type and loan amount. On primary residences and second home properties, LTVs range from a maximum of 80 percent for loan amounts to $2 million to 60 percent for loan amounts to $7.5 million. Loans greater than $7.5 million will also be considered based on the strength of the overall credit profile of the borrower. For investment properties, LTVs range from a maximum of 80 percent for loan amounts to $2 million to 65 percent for loan amounts to $5 million. Underwriting guidelines include (i) minimum credit report scores of 680 and (ii) a maximum debt to income ratio of 45 percent. The Bank may consider an exception to any guideline if there are strong compensating factors that mitigate any risk. Generally, the Bank retains in its portfolio residential mortgage loans with fixed-rate maturities of no greater than ten years, which then convert to annually adjusted floating rates. Community Development loans granted under the Affordable Housing Program are offered with 30-year maturities. Loans with longer maturities or lower credit scores are sold to secondary market investors. The Bank does not originate, purchase or carry any sub-prime mortgage loans.

Risk characteristics associated with primary residential mortgage loans typically involve major living or lifestyle changes to the borrower, including: unemployment or other loss of income; unexpected significant expenses, such as for catastrophic events; and divorce or death. In addition, residential mortgage loans that have adjustable rates could expose the borrower to higher debt service requirements in a rising interest rate environment. Further, real estate values could drop significantly and cause the value of the property to fall below the loan amount, creating additional potential exposure for the Bank.

45

b)
Junior Lien Loan on Residence (which include home equity lines of credit). The Bank provides junior lien loans (“JLL”) and revolving home equity lines of credit against one-to four-family properties in the Tri-State area. Junior lien loans are a revolving home equity line of credit. These loans are subordinate to a first mortgage which may be from another lending institution. The Bank requires that the mortgage securing the JLL be no lower than a second lien position. When reviewing the JLL application, the Bank collects detailed verifiable information regarding income, assets, employment and a credit report that determines total monthly debt obligations. The Bank uses an independent appraisal of the subject property on all applications. LTVs and combined LTVs are capped at 75 percent for home equity lines of credit if the property type is a primary residence. All applications for JLLs adhere to applicable underwriting standards and guidelines. Exceptions can be made to these guidelines with compensating factors that mitigate the risk associated with the exception. Primary risk characteristics associated with JLLs typically involve major living or lifestyle changes to the borrower are the same as noted above for Primary Residential Mortgages.

c)
Multifamily Loans. Multifamily loans are commercial mortgages on residential apartment buildings. Multifamily loans are expected to be repaid from the cash flows of the underlying property so the collective amount of rents must be sufficient to cover all operating expenses, maintenance, taxes and debt service. Increases in vacancy rates, interest rates or other changes in general economic and political conditions can have an impact on the borrower and their ability to repay the loan. Certain markets, such as the Boroughs of New York City, are rent regulated, and as such, feature rents that are below market rates. Historically, rent regulated properties have been characterized by relatively stable occupancy levels and longer-term tenants. It is noted, however, New York City rent regulated buildings have had an increased level of non-paying tenants with a very protracted eviction process, which has negatively impacted rent collections. As a loan asset class for many banks, multifamily loans historically have experienced much lower historical loss rates compared to other types of commercial lending, however, given the stress on the New York rent regulated buildings, it is not clear if this will continue.

The Bank’s loan policy allows loan to appraised value ratios of up to 75 percent and the overall portfolio average loan to value ratio was approximately 60 percent at December 31, 2025 based on appraisals at the time of origination or at renewal or if any update is required per regulations. The majority of all new originations have a ten-year maturity with a repricing of the interest rate after five years.

Multifamily loan terms include prepayment penalties and generally require that the Bank escrow for real estate taxes. Multifamily loans will typically have a minimum debt service coverage ratio that provides for an adequate cushion for unexpected or uncertain events and changes in market conditions. In the loan underwriting process, the Bank requires an independent appraisal and review, appropriate environmental due diligence and an assessment of the property’s condition.

Multifamily properties generally present a lower level of risk as compared to investment commercial real estate projects given that there are a larger number of tenants in the property. The repayment of loans secured by multifamily real estate is typically dependent upon the successful operation of the related real estate property. If the cash flows from the property are reduced (for example, if tenants stop paying rent, leases are not obtained or renewed, or a bankruptcy court modifies a lease term), the borrower’s ability to repay the loan may be impaired.

d) Owner-Occupied Commercial Real Estate Loans. The Bank provides mortgage loans for owner-occupied commercial real estate properties in the Tri-State area and Pennsylvania.

The terms and conditions of all commercial mortgage loans are tailored to the specific attributes of the borrower and any guarantors as well as the nature of the property and loan purpose.

With an owner-occupied property, a detailed credit assessment is made of the operating business since its ongoing success and profitability will be the primary source of repayment. While owner-occupied properties include the real estate as collateral, the risk assessment of the operating business is more similar to the underwriting of commercial and industrial loans (described below). The Bank evaluates factors such as, but not limited to, the expected sustainability of profits and cash flows, the depth and experience of management and ownership, the nature of competition, and the impact of forces like regulatory change and evolving technology.

Commercial mortgage loans are generally made with an initial fixed rate with periodic rate resets at five years over an underlying market index. Resets may not be automatic and are subject to re-approval. Commercial mortgage loan terms include prepayment penalties and generally require that the Bank escrow for real estate taxes. The Bank

46

requires an independent appraisal, an assessment of the property’s condition, and appropriate environmental due diligence. With all commercial real estate loans, the Bank’s standard practice is to require a depository relationship.

e)
Investment Commercial Real Estate Loans. The Bank provides mortgage loans for properties managed as an investment property (non-owner-occupied) in the Tri-State area and Pennsylvania.

The terms and conditions of all commercial mortgage loans are tailored to the specific attributes of the borrower and any guarantors as well as the nature of the property and loan purpose. In the case of investment commercial real estate properties, the Bank reviews, among other things, the composition and mix of the underlying tenants, terms and conditions of the underlying tenant lease agreements, the resources and experience of the sponsor, and the condition and location of the subject property.

Commercial real estate loans are generally considered to have a higher degree of credit risk than multifamily loans as they may be dependent on the ongoing success and operating viability of a fewer number of tenants who are occupying the property and who may have a greater degree of exposure to various industry or economic conditions. To mitigate this risk, the Bank generally requires an assignment of leases, direct recourse to the owners, and a risk appropriate interest rate and loan structure. In underwriting an investment commercial real estate loan, the Bank evaluates the property’s historical operating income as well as its projected sustainable cash flows and generally requires a minimum debt service coverage ratio that provides for an adequate cushion for unexpected or uncertain events and changes in market conditions.

Commercial mortgage loans are generally made with an initial fixed rate with periodic rate resets at five years over an underlying market index. Resets may not be automatic and subject to re-approval. Commercial mortgage loan terms include prepayment penalties and generally require that the Bank escrow for real estate taxes. The Bank requires an independent appraisal, an assessment of the property’s condition, and appropriate environmental due diligence. With all commercial real estate loans, the Bank’s standard practice is to require a depository relationship.

f)
Commercial and Industrial Loans. The Bank provides lines of credit and term loans to operating companies for business purposes. The loans are generally secured by business assets such as accounts receivable, inventory, business vehicles and equipment as well as the stock of the company, if privately held. In addition, these loans may include commercial real estate as collateral to strengthen the Bank’s position and further mitigate risk. When underwriting business loans, among other things, the Bank evaluates the historical profitability and debt servicing capacity of the borrowing entity and the financial resources and character of the principal owners and guarantors.

Commercial and industrial loans are typically repaid by the cash flows generated by the borrower’s business. The primary risk characteristics are specific to the underlying business and its ability to generate sustainable profitability and resulting positive cash flows. Factors that may influence a business’ profitability include, but are not limited to, demand for its products or services, quality and depth of management, degree of competition, regulatory changes, and general economic conditions. Commercial and industrial loans are generally secured by business assets; however, the ability of the Bank to foreclose and realize sufficient value from the assets is often highly uncertain. To mitigate the risk characteristics of commercial and industrial loans, the Bank often requires more frequent reporting requirements from the borrower in order to better monitor its business performance.

g)
Leasing and Equipment Finance. Peapack Capital Corporation (“PCC”), a subsidiary of the Bank, offers a range of finance solutions nationally. PCC provides term loans and leases secured by assets financed for small, mid-size and large companies based in the U.S. Facilities tend to be fully drawn under fixed-rate terms. PCC serves a broad range of industries including transportation, manufacturing, heavy construction and utilities.

Asset risk in PCC’s portfolio is generally recognized through changes to loan income, or through changes to lease- related income streams due to fluctuations in lease rates. Changes to lease income can occur when the existing lease contract expires, the asset comes off lease, or the business seeks to enter a new lease agreement. Asset risk may also change depreciation, resulting from changes in the residual value of the operating lease asset or through impairment of the asset carrying value, which can occur at any time during the life of the asset.

Credit risk in PCC’s portfolio generally results from the potential default of borrowers or lessees, which may be driven by customer specific or broader industry-related conditions. Credit losses can impact multiple parts of the income statement including an increase in the provision for credit losses, loss of interest/lease/rental income and/or via higher costs and expenses related to the repossession, refurbishment, re-marketing and or re-leasing of assets.

47

h) Construction. The Bank selectively provides commercial construction loans for properties located in the Tri-state area. Risks common to commercial construction loans are cost overruns, inaccurate estimates of the time to complete construction, changes in market demand for property, inadequate long-term financing arrangements and declines in real estate values. Changes in market demand for property could lead to longer marketing times resulting in higher carrying costs, declining values, and higher interest rates.

i) Consumer and Other. These are loans to individuals for household, family and other personal expenditures as well as obligations of states and political subdivisions in the U.S. This also represents all other loans that cannot be categorized in any of the previous mentioned loan segments. Consumer loans generally have higher interest rates and shorter terms than residential loans but tend to have higher credit risk due to the depreciating nature of the collateral securing the loan or in some cases the absence of collateral.

Management believes that the underwriting guidelines previously described adequately address the primary risk characteristics. Further, the Bank has dedicated staff and resources to monitor and collect on any potentially problematic loans.

The following table presents the credit loss experience, by loan type, during the years ended December 31:

(Dollars in thousands)

2025

2024

2023

2022

2021

Average loans outstanding

$

5,837,009

$

5,327,594

$

5,396,212

$

5,105,200

$

4,494,473

Allowance for credit losses at beginning of year (A)

$

72,992

$

65,888

$

60,829

$

61,697

$

67,309

Day one CECL adjustment

—

—

—

(5,536

)

—

Loans charged-off during the period:

Residential mortgage

—

43

—

—

12

Commercial mortgage

12,991

5,379

3,422

1,450

7,137

Commercial

13,880

345

5,594

—

5,019

Home equity lines of credit

—

—

—

3

—

Consumer and other

37

39

139

53

80

Total loans charged-off

26,908

5,806

9,155

1,506

12,248

Recoveries during the period:

Residential mortgage

—

—

52

15

—

Commercial mortgage

24

—

—

—

—

Commercial

1,286

5,409

—

254

66

Home equity lines of credit

—

—

—

—

85

Consumer and other

44

5

6

2

10

Total recoveries

1,354

5,414

58

271

161

Net charge-offs/(recoveries)

25,554

392

9,097

1,235

12,087

Provision charge to expense

23,601

7,496

14,156

5,903

6,475

Allowance for credit losses at end of year

$

71,039

$

72,992

$

65,888

$

60,829

$

61,697

Ratios:

Allowance for credit losses/total loans (B)

1.14

%

1.32

%

1.21

%

1.15

%

1.28

%

Allowance for loans collectively evaluated/total loans (B)

0.94

%

1.09

%

1.13

%

1.12

%

1.20

%

Nonaccrual loans/total loans (B)

1.09

%

1.82

%

1.13

%

0.36

%

0.32

%

Allowance for credit losses/

   total nonperforming loans

104.10

%

72.87

%

107.44

%

320.59

%

396.18

%

Net charge offs/average loans:

   Residential mortgage

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

   Commercial mortgage

0.22

%

0.10

%

0.06

%

0.03

%

0.16

%

   Commercial

0.22

%

-0.10

%

0.10

%

0.00

%

0.11

%

   Home equity lines of credit

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

   Consumer and other

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

Total net charge offs/average loans

0.44

%

0.00

%

0.16

%

0.03

%

0.27

%

(A)
Commencing on January 1, 2022, the allowance calculation is based on the CECL methodology. Prior to January 1, 2022, the calculation was based on the incurred loss methodology. Provision to roll forward the ACL excludes a credit of $83,000, a provision of $4,000, a credit of $65,000 and a provision of $450,000 at December 31, 2025, 2024, 2023 and 2022, respectively, related to off-balance sheet commitments.

(B)
The December 31, 2024, 2023, 2022 and 2021 ACL coverage ratios include PPP loans of $297,000, $1.0 million, $1.7 million and $13.8 million, respectively.

48

The following table shows the allocation of the allowance for credit losses and the percentage of each loan category, by collateral type, to total loans as of December 31, of the years indicated:

% of

% of

% of

% of

% of

Loan

Loan

Loan

Loan

Loan

Category

Category

Category

Category

Category

To Total

To Total

To Total

To Total

To Total

(Dollars in thousands)

2025

Loans

2024

Loans

2023

Loans

2022

Loans

2021

Loans

Residential

$

5,536

11.1

$

4,578

11.9

$

4,108

11.5

$

3,048

10.7

$

1,520

11.3

Commercial and other

62,311

85.9

67,230

86.7

60,911

87.3

57,244

88.5

59,962

87.8

Consumer and other

3,192

3.0

1,184

1.4

869

1.2

537

0.8

215

0.9

Total

$

71,039

100.0

$

72,992

100.0

$

65,888

100.0

$

60,829

100.0

$

61,697

100.0

The portion of the allowance for credit losses allocated to loans collectively evaluated for impairment, commonly referred to as general reserves, was $59.0 million at December 31, 2025 and $60.3 million at December 31, 2024. General reserves at December 31, 2025 represented 0.94 percent of loans collectively evaluated for impairment compared to 1.09 percent at December 31, 2024. Though loan balances grew in 2025, the overall general reserve coverage declined primarily due to the annual CECL model recalibration, which incorporated lower historical loss rates resulting in a lower required general reserve. The specific reserves on individually evaluated loans were $12.0 million at December 31, 2025 compared to $12.7 million at December 31, 2024.

The allowance for credit losses as a percentage of nonperforming loans increased to 104 percent due to a decrease in nonperforming loans. Nonperforming loans decreased from $100.2 million to $68.2 million impacted by $20.3 million attributed to one commercial loan relationship and $22.3 million to five multifamily loans that were resolved in 2025. Nonperforming loans are specifically evaluated for impairment. Also, the Company commonly records partial charge-offs of the excess of the principal balance over the fair value, less estimated costs to sell, of collateral for collateral-dependent impaired loans. As a result, the allowance for credit losses does not always change proportionately with changes in nonperforming loans. The Company charged off $26.6 million on loans identified as collateral-dependent individually evaluated loans during 2025. The Company charged off $5.4 million on loans identified as collateral-dependent impaired loans during 2024.

ASSET QUALITY: The following table presents various asset quality data at the dates indicated. These tables do not include loans held for sale.

December 31,

(Dollars in thousands)

2025

2024

2023

2022

2021

Loans past due 30-89 days (A)

$

26,555

$

4,870

$

34,589

$

7,592

$

8,606

Modifications

$

131,230

$

49,479

$

3,254

$

—

$

—

Troubled debt restructured loans (B)

$

—

$

—

$

—

$

14,318

$

3,575

Loans past due 90 days or more and

   still accruing interest

$

—

$

—

$

—

$

—

$

—

Nonaccrual loans (C)

68,243

100,168

61,324

18,974

15,573

Total nonperforming loans

68,243

100,168

61,324

18,974

15,573

Other real estate owned

—

—

—

116

—

Total nonperforming assets

$

68,243

$

100,168

$

61,324

$

19,090

$

15,573

Ratios:

Total nonperforming loans/total loans

1.09

%

1.82

%

1.13

%

0.36

%

0.32

%

Total nonperforming loans/total assets

0.91

1.43

0.95

0.30

0.26

Total nonperforming assets/total assets

0.91

1.43

0.95

0.30

0.26

(A)
Included $14.2 million related to three multifamily loans and $4.2 million for one equipment lease at December 31, 2025. Included $16.5 million and $4.5 million outstanding to U.S. governmental entities at December 31, 2023 and December 31, 2022, respectively. Included $6.9 million for one equipment lease principally due to administrative issues with the servicer and at the lessee/borrower at December 31, 2021.

49

(B)
On January 1, 2023, the Company adopted Accounting Standards Update 2022-02, which replaced the accounting and recognition of TDRs.

(C)
The increase in nonaccrual loans in 2024 was largely due to nine multifamily credits totaling $51.5 million at December 31, 2024. The increase in nonaccrual loans in 2023 was due to one freight credit totaling $23.5 million and three multifamily credits totaling $16.6 million at December 31, 2023.

At December 31, 2025, there were no commitments to lend additional funds to borrowers whose loans were classified as nonperforming.

LOAN MODIFICATIONS:

The Company will provide modifications, which may include other than insignificant delays in payment of amounts due, extension of the terms of the notes or reduction in the interest rates on the notes. In certain instances, the Company may grant more than one type of modification.

The following table presents the modified loans, by collateral type, at December 31, 2025:

December 31,

Number of

(Dollars in thousands)

2025

Relationships

Primary residential mortgage

$

690

3

Multifamily property

102,374

21

Commercial and industrial

28,166

13

Total

$

131,230

37

The following table presents the modified loans, by collateral type, at December 31, 2024:

December 31,

Number of

(Dollars in thousands)

2024

Relationships

Primary residential mortgage

$

648

2

Investment commercial real estate

17,838

2

Commercial and industrial

30,993

9

Total

$

49,479

13

The increase in modified loans was primarily due to modifications related to multifamily property credits during 2025. The increase in multifamily property modifications was driven by various relationships which were impacted by the limitations imposed on rent increases along with higher costs to maintain and operate rental properties. There were $160,000 in specific reserves on the multifamily property loans and $5.6 million in specific reserves on the commercial and industrial loans modified in 2025. Each of these loans was performing according to its modified terms as of December 31, 2025.

At December 31, 2025, there were fourteen modified loans totaling $37.2 million included in nonaccrual loans. At December 31, 2024, there were four modified loans of $3.6 million included in nonaccrual loans. At December 31, 2025, fourteen modified loans totaling $37.2 million were included in individually evaluated loans and had specific reserves of $5.8 million. At December 31, 2024, four modified loans of $3.6 million were included in individually evaluated loans and had a specific reserve of $86,000.

Except as disclosed, the Company did not have any potential problem loans at December 31, 2025 or December 31, 2024 that caused Management to have serious doubts as to the ability of such borrowers to comply with the present loan repayment terms and which may result in disclosure of such loans.

50

The following table presents individually evaluated loans, by collateral type, at December 31, 2025 and 2024:

December 31,

Number of

December 31,

Number of

(Dollars in thousands)

2025

Relationships

2024

Relationships

Primary residential mortgage

$

2,573

11

$

2,779

10

Junior lien loan on residence

106

3

92

2

Multifamily property

31,343

5

53,105

10

Investment commercial real estate

11,557

2

11,684

2

Commercial and industrial

22,641

25

30,881

21

Lease financing

23

3

1,234

4

Total

$

68,243

49

$

99,775

49

Specific reserves, included in the allowance for loan losses

$

12,034

$

12,683

Loans individually evaluated totaled $68.2 million at December 31, 2025 as compared to $99.8 million at December 31, 2024, all of which were nonaccrual. The decrease was primarily due to the resolution of an equipment financing relationship with a loan balance of $20.3 million and six multifamily loans with balances totaling $25.9 million, partially offset by $17.3 million of commercial and industrial loans and $4.8 million of multifamily loans that migrated to nonperforming status during 2025. Individually evaluated loans included fourteen modified loans at December 31, 2025, totaling $37.2 million. Individually evaluated loans included four modified loans totaling $3.6 million at December 31, 2024.

CONTRACTUAL OBLIGATIONS: Leases represent obligations entered into by the Company for the use of land and premises. The leases generally have escalation terms based upon certain defined indexes. Common area maintenance charges may also apply and are adjusted annually based on the terms of the lease agreements. See Notes 1 and 15 in Notes in Consolidated Financial Statements for further discussion on leases.

Purchase obligations represent legally binding and enforceable agreements to purchase goods and services from third parties and consist of contractual obligations under data processing service agreements. The Company also enters into various routine rental and maintenance contracts for facilities and equipment. These contracts are generally for one year.

The Company is a limited partner in a Small Business Investment Company (“SBIC”). As of December 31, 2025, the Company had unfunded commitments of $6.7 million for its investment in SBIC qualified funds.

OFF-BALANCE SHEET ARRANGEMENTS: The following table shows the amounts and expected maturities of significant commitments, consisting primarily of letters of credit, as of December 31, 2025.

Less Than

More Than

(In thousands)

One Year

1-3 Years

3-5 Years

5 Years

Total

Financial letters of credit

$

49,620

$

4,015

$

2,518

$

—

$

56,153

Performance letters of credit

819

353

—

—

1,172

Interest rate lock commitments-residential mortgages

10,635

—

—

—

10,635

Total letters of credit

$

61,074

$

4,368

$

2,518

$

—

$

67,960

Commitments under standby letters of credit, both financial and performance, do not necessarily represent future cash requirements, in that these commitments often expire without being drawn upon.

51

OTHER INCOME: The following table presents the major components of other income (excluding income from our wealth management operations, which is discussed separately):

Years Ended December 31,

Change

(In thousands)

2025

2024

2023

2025 vs 2024

2024 vs 2023

Service charges and fees

$

4,807

$

5,317

$

5,152

$

(510

)

$

165

Bank owned life insurance

1,675

1,556

1,269

119

287

Loan fee income

6,525

7,460

7,429

(935

)

31

Gains on loans held for sale at fair

   value (mortgage banking)

132

163

91

(31

)

72

Gain on securities sale, net

7

—

—

7

—

Fair value adjustment for equity securities

418

828

181

(410

)

647

Fee income related to loan level,

   back-to-back swaps

492

—

—

492

—

(Loss)/gains on loans held for sale at

   lower of cost or fair value

(364

)

23

—

(387

)

23

Gain on sale of SBA loans

1,584

1,214

2,433

370

(1,219

)

Corporate advisory fee income

820

1,032

219

(212

)

813

Other income

2,749

71

1,057

2,678

(986

)

Total other income

$

18,845

$

17,664

$

17,831

$

1,181

$

(167

)

2025 compared to 2024

The Company recorded total other income, excluding wealth management fee income, of $18.8 million in 2025, compared to $17.7 million for 2024, reflecting an increase of $1.2 million.

Service charges and fee income decreased in 2025 reflecting our shift from a retail‑oriented deposit base to a more commercially focused client portfolio, which typically generates lower fee activity.

The Company provides loans that are partially guaranteed by the SBA, to provide working capital and/or finance the purchase of equipment, inventory or commercial real estate and that could be used for start-up businesses. All SBA loans are underwritten and documented as prescribed by the SBA. The Company generally sells the guaranteed portion of the SBA loans in the secondary market, with the non-guaranteed portion of SBA loans held in the loan portfolio. Gain on sale of SBA loans for 2025 increased by $370,000 to $1.6 million for 2025 compared to $1.2 million in 2024. The 2025 period was positively affected by the greater demand for capital as small business confidence improved, resulting in an increase in origination volumes.

The Company recorded corporate advisory fee income of $820,000 for 2025 compared to $1.0 million for 2024. The Company completed one corporate advisory/investment banking acquisition transaction in the third quarter of 2025, as well as one transaction in the first quarter of 2024.

The Company recorded $492,000 related to loan level, back-to-back swaps in 2025 compared to no fee income for back-to-back swaps recorded in 2024. The program provides a borrower with a degree of interest rate protection on a variable-rate loan, while still providing an adjustable rate to the Company, thus helping to manage the Company's interest rate risk, while contributing to income. The Company expects back-to-back swap activity will continue to be minimal in the current rate environment. Income from the back-to-back swap, corporate advisory fee income and SBA programs are dependent on volume, and may vary from period to period.

Income from the sale of newly originated residential mortgages loans for 2025 decreased to $132,000 from $163,000 for the year ended December 31, 2025. The Company continues to be impacted by the industry wide slowdown in refinancing and home purchase activity due to inventory constraints and elevated mortgage rates.

Loan fee income included $3.5 million of unused commercial credit line fees in 2025 compared to $3.3 million for 2024. Additionally, the Company recorded $821,000 of income generated by the Equipment Finance Division related to equipment transfers to lessees in 2025 compared to $2.6 million for the same 2024 period.

52

Included in other income was a gain of $875,000 related to the termination of a lease agreement for a branch location that was no longer in use in 2025. Other income also included $1.2 million of SBIC income for the year ended December 31, 2025.

During the year ended December 31, 2025, the Company recorded a $418,000 positive fair value adjustment for CRA equity securities compared to a negative adjustment of $125,000 for 2024. The positive fair value adjustment was due to a decline in medium-term rates during 2025. Additionally, the Company sold its Visa B shares which resulted in a positive fair value adjustment to equity securities of $953,000 during the year ended December 31, 2024.

OPERATING EXPENSES: The following table presents the major components of operating expenses:

Years Ended December 31,

Change

(In thousands)

2025

2024

2023

2025 vs 2024

2024 vs 2023

Compensation and employee benefits

$

145,492

$

122,325

$

100,524

$

23,167

$

21,801

Premises and equipment

26,613

22,485

19,733

4,128

2,752

FDIC assessment

4,810

3,510

2,946

1,300

564

Other operating expenses:

Professional and legal fees

6,675

7,309

5,710

(634

)

1,599

Trust department expense

4,385

4,014

3,837

371

177

Telephone

1,594

1,616

1,531

(22

)

85

Loan expense

2,697

1,295

1,200

1,402

95

Amortization of intangible assets

1,088

1,088

1,319

—

(231

)

Advertising

2,053

2,111

1,872

(58

)

239

Other operating expenses

11,761

9,923

9,623

1,838

300

Total operating expense

$

207,168

$

175,676

$

148,295

$

31,492

$

27,381

2025 compared to 2024

Operating expenses totaled $207.2 million in 2025, compared to $175.7 million in 2024, reflecting an increase of $31.5 million, or 18 percent. Increased operating expenses in 2025 were principally attributable to the Company's ongoing expansion into the metro New York City market, increased health insurance costs, and annual merit increases. The addition of production teams in Long Island and the expansion of our equipment financing team, which included the opening of two new Long Island offices and related computer and software equipment investments, contributed to an increase in premises and equipment expense in 2025. The increase in loan expense during 2025 was largely due to expenses related to the workout of several equipment finance and multifamily problem loans. FDIC assessment in 2025 increased $1.3 million compared to 2024, due primarily to higher assessment rates implemented by the FDIC and an increase in the Bank's average total assets subject to assessment.

INCOME TAXES: Income tax expense for the year ended December 31, 2025 was $15.0 million as compared to $12.0 million for 2024. The effective tax rate for the year ended December 31, 2025 was 28.6 percent as compared to 26.6 percent for the year ended December 31, 2024. The year ended December 2024 included the impact of discrete, favorable federal return to provision adjustments primarily related to the Company's state tax apportionment rate.

CAPITAL RESOURCES: A solid capital base provides the Company with financial strength and the ability to support future growth and is essential to executing the Company’s Strategic Plan. The Company’s capital strategy is intended to provide stability to expand its businesses, even in stressed environments. The Company employs quarterly capital stress testing - adverse case and severely adverse case. In the most recent stress test was completed using September 30, 2025 data, under severely adverse case, no growth scenarios, the Bank remains well capitalized over the two-year stress period.

The Company strives to maintain capital levels in excess of internal “triggers” and in excess of those considered to be well capitalized under regulatory guidelines applicable to banks and bank holding companies. Maintaining an adequate capital position supports the Company’s goal of providing shareholders an attractive and stable long-term return on investment.

The Company’s capital position during 2025 was enhanced by net income of $37.3 million. Capital also improved as a result of a decline in accumulated other comprehensive loss of $18.9 million, net of tax. The decrease was primarily due to a $22.9 million gain related to the available for sale securities portfolio partially offset by a $4.0 million loss on cash flow hedges.

53

The increases in capital were partially offset by share repurchases of $5.4 million and cash dividends of $3.5 million during the year ended December 31, 2025.

At December 31, 2025, the Company’s GAAP capital as a percent of total assets was 8.75 percent. At December 31, 2025, the Company’s regulatory leverage, common equity tier 1, tier 1 and total risk-based capital ratios were 8.87 percent, 10.33 percent, 10.33 percent and 12.68 percent, respectively. At December 31, 2025, the Bank’s regulatory leverage, common equity tier 1, tier 1 and total risk-based capital ratios were 9.89 percent, 11.52 percent, 11.52 percent and 12.64 percent, respectively. At December 31, 2025, the Company’s and the Bank’s regulatory capital ratios were all above the ratios to be considered well capitalized under regulatory guidance.

As a result of the enacted Economic Growth, Regulatory Relief, and Consumer Protection Act, the federal banking agencies were required to develop a “Community Bank Leverage Ratio” (the ratio of a bank’s tangible equity capital to average total consolidated assets) for financial institutions with assets of less than $10 billion. A “qualifying community bank” that exceeds this ratio will be deemed to be in compliance with all other capital and leverage requirements, including the capital requirements to be considered “well capitalized” under Prompt Corrective Action statutes. The federal banking agencies set the minimum capital for the new Community Bank Leverage Ratio at 9 percent. The Bank did not opt into the CBLR and will continue to comply with the requirements under Basel III.

To be categorized as well capitalized, the Bank must maintain minimum total risk-based, Tier I risk-based, common equity Tier I and Tier I leverage ratios as set forth in the table.

The Bank’s regulatory capital amounts and ratios are presented in the following table:

To Be Well

For Capital

Capitalized Under

For Capital

Adequacy Purposes

Prompt Corrective

Adequacy

Including Capital

Actual

Action Provisions

Purposes

Conservation Buffer (A)

(Dollars in thousands)

Amount

Ratio

Amount

Ratio

Amount

Ratio

Amount

Ratio

As of December 31, 2025:

Total capital

(to risk-weighted assets)

807,580

12.64

%

$

638,896

10.00

%

$

511,117

8.00

%

$

670,841

10.50

%

Tier I capital

(to risk-weighted assets)

735,931

11.52

511,117

8.00

383,338

6.00

543,062

8.50

Common equity tier I

(to risk-weighted assets)

735,872

11.52

415,282

6.50

287,503

4.50

447,227

7.00

Tier I capital

(to average assets)

735,931

9.89

372,195

5.00

297,756

4.00

297,756

4.00

As of December 31, 2024:

Total capital

(to risk-weighted assets)

$

801,365

14.75

%

$

543,234

10.00

%

$

434,587

8.00

%

$

570,396

10.50

%

Tier I capital

(to risk-weighted assets)

733,389

13.50

434,587

8.00

325,940

6.00

461,749

8.50

Common equity tier I

(to risk-weighted assets)

733,383

13.50

353,102

6.50

244,455

4.50

380,264

7.00

Tier I capital

(to average assets)

733,389

10.57

347,006

5.00

277,605

4.00

277,605

4.00

(A)
The Basel Rules require the Company and the Bank to maintain a 2.5 percent “capital conservation buffer” on top of the minimum risk-weighted asset ratios. The capital conservation buffer is designed to absorb losses during periods of economic stress. Banking institutions with a ratio of (i) CET1 to risk-weighted assets, (ii) Tier 1 capital to risk-weighted assets or (iii) total capital to risk-weighted assets above the respective minimum but below the capital conservation buffer face constraints on dividends, stock repurchases and discretionary bonus payments to executive officers based on the amount of the shortfall.

54

The Company’s regulatory capital amounts and ratios are presented in the following table:

To Be Well

For Capital

Capitalized Under

For Capital

Adequacy Purposes

Prompt Corrective

Adequacy

Including Capital

Actual

Action Provisions

Purposes

Conservation Buffer (A)

(Dollars in thousands)

Amount

Ratio

Amount

Ratio

Amount

Ratio

Amount

Ratio

As of December 31, 2025:

Total capital

(to risk-weighted assets)

811,375

12.68

%

N/A

N/A

$

511,816

8.00

%

$

671,759

10.50

%

Tier I capital

(to risk-weighted assets)

660,696

10.33

N/A

N/A

383,862

6.00

543,805

8.50

Common equity tier I

(to risk-weighted assets)

660,637

10.33

N/A

N/A

287,897

4.50

447,839

7.00

Tier I capital

(to average assets)

660,696

8.87

N/A

N/A

298,086

4.00

298,086

4.00

As of December 31, 2024:

Total capital

(to risk-weighted assets)

$

806,404

14.84

%

N/A

N/A

$

434,830

8.00

%

$

570,715

10.50

%

Tier I capital

(to risk-weighted assets)

625,830

11.51

N/A

N/A

326,123

6.00

462,007

8.50

Common equity tier I

(to risk-weighted assets)

625,824

11.51

N/A

N/A

244,592

4.50

380,477

7.00

Tier I capital

(to average assets)

625,830

9.01

N/A

N/A

277,710

4.00

277,710

4.00

(A)
The Basel Rules require the Company and the Bank to maintain a 2.5 percent “capital conservation buffer” on top of the minimum risk-weighted asset ratios. The capital conservation buffer is designed to absorb losses during periods of economic stress. Banking institutions with a ratio of (i) CET1 to risk-weighted assets, (ii) Tier 1 capital to risk-weighted assets or (iii) total capital to risk-weighted assets above the respective minimum but below the capital conservation buffer face constraints on dividends, stock repurchases and discretionary bonus payments to executive officers based on the amount of the shortfall.

The Dividend Reinvestment Plan of Peapack-Gladstone Financial Corporation, or the “Reinvestment Plan,” allows shareholders of the Company to purchase shares of common stock using cash dividends without payment of any brokerage commissions or other charges. Shareholders may also make voluntary cash payments of up to $200,000 per quarter to purchase shares of common stock. Voluntary share purchases in the Reinvestment Plan can be filled from the Company’s authorized but unissued shares and/or in the open market, at the discretion of the Company. All shares purchased through the Plan in both 2025 and 2024 were purchased in the open market.

Management believes the Company’s capital position and capital ratios are adequate at December 31, 2025. Further, Management believes the Company has sufficient common equity to support its planned growth for the immediate future. The Company continually assesses other potential sources of capital to support future growth.

LIQUIDITY: Liquidity refers to an institution’s ability to meet short-term requirements including funding of loans, deposit withdrawals and maturing obligations, as well as long-term obligations, including potential capital expenditures. The Company’s liquidity risk management is intended to ensure the Company has adequate funding and liquidity to support its assets across a range of market environments and conditions, including stressed conditions. Principal sources of liquidity include cash, temporary investments, securities available for sale, customer deposit inflows, loan repayments and secured borrowings. Other liquidity sources include loan and security sales and loan participations.

Management actively monitors and manages the Company’s liquidity position and believes it is sufficient to meet future needs. Cash and cash equivalents, including federal funds sold and interest-earning deposits, totaled $187.8 million at December 31, 2025. In addition, the Company had $774.2 million in securities designated as available for sale at December 31, 2025. These securities can be sold, or used as collateral for borrowings, in response to liquidity concerns. Available for sale and held to maturity securities with a carrying value of $553.2 million and $93.9 million as of December 31, 2025, respectively, were pledged to secure public funds and for other purposes required or permitted by law. However, only $46.6

55

million of pledged securities are encumbered. In addition, the Company generates significant liquidity from scheduled and unscheduled principal repayments of loans and mortgage-backed securities.

As of December 31, 2025, the Company had approximately $3.63 billion of external borrowing capacity available on a same day basis (subject to any practical constraints affecting the FHLB or FRB), which when combined with balance sheet liquidity provided the Company with 244 percent coverage of our uninsured/unprotected deposits.

The Company has a Board-approved Contingency Funding Plan, which provides a framework for managing adverse liquidity stress and contingent sources of liquidity. The Company conducts liquidity stress testing on a regular basis to ensure sufficient liquidity in a stressed environment.

Peapack-Gladstone Financial Corporation is a separate legal entity from the Bank and must provide for its own liquidity to pay dividends to its shareholders, to repurchase shares of its common stock, satisfy debt obligations and for other corporate purposes. Peapack-Gladstone Financial Corporation’s primary source of income is dividends received from the Bank. The Bank’s ability to pay dividends is governed by applicable law. At December 31, 2025, Peapack-Gladstone Financial Corporation (unconsolidated basis) had liquid assets of $15.9 million.

Management believes the Company’s liquidity position and sources were adequate at December 31, 2025.

WEALTH MANAGEMENT DIVISION: This division includes: investment management services provided for individuals and institutions; personal trust services, including services as executor, trustee, administrator, custodian and guardian, and other financial planning, tax preparation and advisory services. Officers from the wealth management division are available to provide wealth management, trust and investment services at the Bank’s headquarters in Bedminster, New Jersey at private banking locations in Morristown, Princeton, Red Bank, Summit and Teaneck, New Jersey, in New York City, in Long Island and at the Bank’s subsidiary, PGB Trust & Investments of Delaware in Greenville, Delaware.

The following table presents certain key aspects of the Wealth Management Division's performance for the years ended December 31, 2025, 2024 and 2023.

Years Ended December 31,

Change

(In thousands)

2025

2024

2023

2025 vs 2024

2024 vs 2023

Total fee income

$

63,240

$

61,458

$

55,747

$

1,782

$

5,711

Assets under management and/or

administration (AUM) (market value)

13.1 billion

11.9 billion

10.9 billion

The following table presents a roll forward of the Wealth Management Division's assets under management and/or administration for the years ended December 31, 2025, 2024 and 2023.

2025

2024

2023

(In billions)

AUM

AUA

AUM

AUA

AUM

AUA

Beginning AUM/AUA

$

10.6

$

1.3

$

9.7

$

1.3

$

8.6

$

1.3

    Inflows

0.9

0.1

0.6

0.2

0.7

0.3

    Outflows

(1.0

)

(0.2

)

(0.8

)

(0.2

)

(0.8

)

(0.4

)

    Net other

0.2

0.0

0.2

(0.0

)

0.2

0.1

      Net Flows

0.1

(0.1

)

(0.1

)

(0.0

)

0.1

(0.1

)

    Market appreciation

1.2

0.1

1.0

0.1

1.0

0.1

Ending AUM/AUA

11.9

1.3

10.6

1.3

9.7

1.3

56

The following table presents a breakdown of the Wealth Management Division's assets under management and/or administration by investment class for the years ended December 31, 2025, 2024 and 2023.

2025

2024

2023

Equities

70.8

%

70.3

%

68.3

%

Fixed income

19.2

18.7

19.6

Cash/other

10.0

11.0

12.1

  Total

100.0

%

100.0

%

100.0

%

The following tables present a breakdown of the Wealth Management Division's fee income for the years ended December 31, 2025, 2024 and 2023.

2025

2024

2023

Recurring

$

60,382

$

57,199

$

51,853

Nonrecurring

2,478

3,613

3,110

Brokerage

380

646

784

  Total fees

$

63,240

$

61,458

$

55,747

2025

2024

2023

Recurring

96

%

93

%

93

%

Nonrecurring

4

7

7

  Total fees

100

%

100

%

100

%

2025

2024

2023

Average bps managed

0.52

%

0.54

%

0.55

%

Average bps unmanaged

0.10

%

0.10

%

0.08

%

2025 compared to 2024

The market value of assets under management and/or administration (“AUM”) at December 31, 2025 and 2024 was $13.1 billion and $11.9 billion, respectively, an increase of 10 percent, primarily due to an improved equity market and modest net client inflows.

Wealth management fees increased $1.8 million, or 3 percent, to $63.2 million for the year ended December 31, 2025 from $61.5 million in 2024. The increase in fee income for the year ended December 31, 2025 was largely due to growth in AUM balances driven by the improved equity and bond markets during 2025. Nonrecurring fees were $2.5 million for the year ended December 31, 2025 as compared to $3.6 million for the same period in 2024. The prior year reflected elevated levels of trust and estate activity.

The Wealth Management Division currently generates adequate revenue to support the salaries, benefits and other expenses of the wealth division and Management believes it will continue to do so as the Company grows organically and/or by acquisition in future periods.

EFFECTS OF INFLATION AND CHANGING PRICES: The financial statements and related financial data presented herein have been prepared in terms of historical dollars without considering changes in the relative purchasing power of money over time due to inflation. Unlike most industrial companies, virtually all of the assets and liabilities of a financial institution are monetary in nature. As a result, interest rates have a more significant impact on a financial institution’s performance than do general levels of inflation.