UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024, or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to              

Commission File No. 001-39680

FULTON FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter) 

Pennsylvania				23-2195389
(State or other jurisdiction of incorporation or organization)				(I.R.S. Employer Identification No.)
One Penn Square	P. O. Box 4887	Lancaster,	Pennsylvania	17604
(Address of principal executive offices)				(Zip Code)

(717) 291-2411

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $2.50	FULT	The Nasdaq Stock Market, LLC
Depositary Shares, Each Representing 1/40th Interest in a Share of Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A	FULTP	The Nasdaq Stock Market, LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.			☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes  ☐    No  ☒

APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

Common Stock, $2.50 Par Value – 181,760,745 shares outstanding as of May 3, 2024.

1

FULTON FINANCIAL CORPORATION

FORM 10-Q FOR THE THREE MONTHS ENDED MARCH 31, 2024

INDEX

Description		Page
Glossary of Terms		3
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited):
(a)	Consolidated Balance Sheets - March 31, 2024 and December 31, 2023	7
(b)	Consolidated Statements of Income - Three months ended March 31, 2024 and 2023	8
(c)	Consolidated Statements of Comprehensive Income - Three months ended March 31, 2024 and 2023	9
(d)	Consolidated Statements of Shareholders’ Equity - Three months ended March 31, 2024 and 2023	10
(e)	Consolidated Statements of Cash Flows - Three months ended March 31, 2024 and 2023	11
(f)	Notes to Consolidated Financial Statements	12
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations		40
Item 3. Quantitative and Qualitative Disclosures About Market Risk		57
Item 4. Controls and Procedures		59
PART II. OTHER INFORMATION
Item 1. Legal Proceedings		60
Item 1A. Risk Factors		60
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		61
Item 3. Defaults Upon Senior Securities - (not applicable)
Item 4. Mine Safety Disclosures - (not applicable)
Item 5. Other Information		63
Item 6. Exhibits		64
Signatures		65

Note: Some numbers contained in the document may not sum due to rounding

2

GLOSSARY OF DEFINED ACRONYMS AND TERMS
2024 Repurchase Program	The authorization, commencing on January 1, 2024 and expiring on December 31, 2024, to repurchase up to $125 million of the Corporation's common stock; under this authorization, up to $25 million of the $125 million authorization may be used to repurchase the Corporation's preferred stock and outstanding subordinated notes
ACL	Allowance for credit losses
AFS	Available for sale
ALCO	Asset/Liability Management Committee
AOCI	Accumulated other comprehensive (loss) income
ASC	Accounting Standards Codification
ASU	Accounting Standards Update
BHCA	Bank Holding Company Act of 1956, as amended
bp or bps	Basis point(s)
Capital Rules	Regulatory capital requirements applicable to the Corporation and Fulton Bank
Corporation, Company, we, our or us	Fulton Financial Corporation
Directors' Plan	Amended and Restated 2023 Director Equity Plan
Dodd-Frank Act	Dodd-Frank Wall Street Reform and Consumer Protection Act
Employee Equity Plan	2022 Amended and Restated Equity and Cash Incentive Compensation Plan
ETR	Effective tax rate
Exchange Act	Securities Exchange Act of 1934, as amended
FASB	Financial Accounting Standards Board
FDIC	Federal Deposit Insurance Corporation
Federal Reserve Board	Board of Governors of the Federal Reserve System
FHLB	Federal Home Loan Bank
FOMC	Federal Open Market Committee
FRB	Federal Reserve Bank
FTE	Fully taxable-equivalent
Fulton Bank or the Bank	Fulton Bank, N.A.
GAAP	U.S. generally accepted accounting principles
HTM	Held to maturity
LIBOR	London Interbank Offered Rate
Management's Discussion	Management’s Discussion and Analysis of Financial Condition and Results of Operations
Merger	The acquisition by the Corporation of Prudential Bancorp that was completed effective as of July 1, 2022
MSRs	Mortgage servicing rights
Net loans	Loan and lease receivables (net of unearned income)
NIM	Net interest margin
N/M	Not meaningful
OBS	Off-balance-sheet
OCI	Other comprehensive income
OREO	Other real estate owned
Pension Plan	Defined Benefit Pension Plan
Postretirement Plan	Postretirement Benefits Plan
Prudential Bancorp	Prudential Bancorp, Inc.
PSU	Performance-based restricted stock unit
Republic First Bank	Republic First Bank, doing business as Republic Bank

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Republic First Assets and Liabilities	The assets acquired and liabilities assumed of Republic First Bank by Fulton Bank in connection with the Republic First Transaction.
Republic First Transaction	The acquisition of substantially all of the assets and assumption of substantially all of the deposits and certain liabilities of Republic First Bank by Fulton Bank from the FDIC, as receiver for Republic First Bank, as described further in “Note 13—Subsequent Events—Acquisition of all of the Assets and Assumption of all of the Deposits and Certain Liabilities of Republic First Bank from the FDIC."
RSU	Restricted stock unit
SBA	Small Business Administration
SEC	United States Securities and Exchange Commission
SOFR	Secured Overnight Financing Rate
TruPS	Trust Preferred Securities

FORWARD-LOOKING STATEMENTS

The Corporation has made, and may continue to make, certain forward-looking statements with respect to its financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward-looking statements can be identified by the use of words such as "may," "should," "will," "could," "estimates," "predicts," "potential," "continue," "anticipates," "believes," "plans," "expects," "future," "intends," "projects," the negative of these terms and other comparable terminology. These forward-looking statements may include projections of, or guidance on, the Corporation's future financial performance, expected levels of future expenses, including future credit losses, anticipated growth strategies, descriptions of new business initiatives and anticipated trends in the Corporation's business or financial results.

Forward-looking statements are neither historical facts, nor assurance of future performance. Instead, the statements are based on current beliefs, expectations and assumptions regarding the future of the Corporation's business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of the Corporation's control, and actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not unduly rely on any of these forward-looking statements. Any forward-looking statement is based only on information currently available and speaks only as of the date when made. In particular, statements about the fair value of the Republic First Assets and Liabilities are based on information provided to the Corporation by the FDIC, some of which has not been independently verified, and which is subject to change as the Corporation acquires additional information about the characteristics of the acquired assets and assumed liabilities. See “Item 1A. Risk Factors—Our assumptions regarding the fair value of Republic First Assets and Liabilities could be inaccurate which could materially and adversely affect our business, financial condition, results of operations, and future prospects.” Statements about the Corporation’s beliefs regarding the impact of the Republic First Transaction, including statements about the value of the assets acquired and the deposits and other liabilities assumed are subject to a number of factors, including the accuracy of the data provided by the FDIC with respect to the acquired assets and assumed liabilities in the Republic First Transaction, the accuracy of the Corporation’s projections with respect to factors, including with respect to future interest rates and allowances for credit losses, that may impact the value of the acquired assets and assumed liabilities, the ability of the Corporation to integrate the acquired assets, assumed liabilities, customers, systems and management personnel following the completion of the Republic First Transaction and the ability of the Corporation to manage costs (including in connection with potential future legal or regulatory costs incurred in connection with the Republic First Transaction) and achieve its projected synergies following the completion of the Republic First Transaction. See “Item 1A. Risk Factors—We may fail to realize the anticipated benefits of the Republic First Transaction” and “—We may incur unforeseen liabilities or losses in connection with the Republic First Transaction.” The Corporation undertakes no obligation, other than as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Many factors could affect future financial results including, without limitation:

•the impact of adverse conditions in the economy and financial markets, including increasing or elevated interest rates and elevated levels of inflation, on the performance of the Corporation's loan portfolio and demand for the Corporation's products and services;

•the potential impacts of recent events affecting the financial services industry on the Corporation, including increased competition for, and costs of, deposits and other funding sources, more stringent regulatory requirements relating to liquidity and interest rate risk management and capital adequacy and increased FDIC insurance expenses;

•the effects of actions by the federal government, including those of the Federal Reserve Board and other government agencies, that impact the money supply and market interest rates;

4

•the effects of market interest rates, and the relative balances of interest rate-sensitive assets to interest rate-sensitive liabilities, on NIM and net interest income;

•the composition of the Corporation's loan portfolio, including commercial mortgage loans, commercial and industrial loans and construction loans, which collectively represent a majority of the loan portfolio, may expose the Corporation to increased credit risk;

•the effects of changes in interest rates on demand for the Corporation's products and services;

•investment securities gains and losses, including declines in the fair value of securities which may result in changes to earnings or shareholders' equity;

•the effects of changes in interest rates or disruptions in liquidity markets on the Corporation's sources of funding;

•capital and liquidity strategies, including the Corporation's ability to comply with applicable capital and liquidity requirements, and the Corporation's ability to generate capital internally or raise capital on favorable terms;

•the effects of competition on deposit rates and growth, loan rates and growth and NIM;

•possible goodwill impairment charges;

•the impact of operational risks, including the risk of human error, inadequate or failed internal processes and systems, computer and telecommunications systems failures, faulty or incomplete data and an inadequate risk management framework;

•the loss of, or failure to safeguard, confidential or proprietary information;

•the Corporation's failure to identify and adequately and promptly address cybersecurity risks, including data breaches and cyberattacks;

•the impact of failures from third-party vendors upon which the Corporation relies to perform in accordance with contractual arrangements and the effects of concerns about other financial institutions on the Corporation;

•the potential to incur losses in connection with repurchase and indemnification payments related to sold loans;

•the potential effects of climate change on the Corporation's business and results of operations;

•the potential effects of increases in non-performing assets, which may require the Corporation to increase the ACL, charge-off loans and incur elevated collection and carrying costs related to such non-performing assets;

•the determination of the ACL, which depends significantly upon assumptions and judgments with respect to a variety of factors, including the performance of the loan portfolio, the weighted-average remaining lives of different classifications of loans within the loan portfolio and current and forecasted economic conditions, among other factors;

•the effects of the extensive level of regulation and supervision to which the Corporation and Fulton Bank are subject;

•changes in regulation and government policy, which could result in significant changes in banking and financial services regulation;

•the continuing impact of the Dodd-Frank Act on the Corporation's business and results of operations;

•the potential for negative consequences resulting from regulatory violations, investigations and examinations, including potential supervisory actions, the assessment of fines and penalties, the imposition of sanctions, the need to undertake remedial actions and possible damage to the Corporation's reputation;

•the effects of adverse outcomes in litigation and governmental or administrative proceedings;

•the effects of changes in U.S. federal, state or local tax laws;

•the effects of the significant amounts of time and expense associated with regulatory compliance and risk management;

•completed and potential acquisitions, including but not limited to the Republic First Transaction, may affect costs and the Corporation may not be able to successfully integrate the acquired business or realize the anticipated benefits from such acquisitions;

•the possibility that the anticipated benefits of the Republic First Transaction, including anticipated cost savings and strategic gains, are not realized when expected or at all, including as a result of the impact of, or challenges arising from, the integration of the acquired assets and assumed liabilities into the Corporation, potential adverse reactions or changes to business or employee relationships, or as a result of other unexpected factors or events;

•the Corporation's ability to successfully integrate into the Corporation's operations any assumed assets, liabilities, customers, systems, and management personnel the Corporation may acquire in connection with the Republic First Transaction, which may result in a disruption to the Corporation’s business;

•changes in the estimated fair value of the Republic First Assets and Liabilities in connection with the Republic First Transaction;

•the possibility of increased scrutiny by, and/or additional regulatory requirements of, governmental authorities as a result of the Republic First Transaction;

•potential exposure to unknown or contingent risks and liabilities the Corporation has acquired, or may acquire, or target for acquisition, including in connection with the purchase and assumption of certain assets and liabilities in connection with the Republic First Transaction;

•geopolitical conditions, including acts or threats of terrorism, actions taken by the United States or other governments in response to acts or threats of terrorism and/or military conflicts, including the war between Russia and Ukraine and

5

escalating conflict in the Middle East, which could impact business and economic conditions in the United States and abroad;

•public health crises and pandemics and their effects on the economic and business environments in which the Corporation operates, including on the Corporation's credit quality and business operations, as well as the impact on general economic and financial market conditions;

•the Corporation's ability to achieve its growth plans;

•the Corporation's ability to attract and retain talented personnel;

•the effects of competition from financial service companies and other companies offering bank services;

•the Corporation's ability to keep pace with technological changes;

•the Corporation's reliance on its subsidiaries for substantially all of its revenues and its ability to pay dividends or other distributions;

•the effects of negative publicity on the Corporation's reputation; and

•other factors that may affect future results of the Corporation.

6

Item 1. Financial Statements

CONSOLIDATED BALANCE SHEETS 

(dollars in thousands, except per-share data)

	March 31, 2024		December 31, 2023
	(unaudited)
ASSETS
Cash and due from banks	$	247,581	$	300,343
Interest-bearing deposits with other banks	109,752		249,367
Cash and cash equivalents	357,333		549,710
FRB and FHLB stock	121,637		124,405
Loans held for sale	10,624		15,158
Investment securities
AFS, at estimated fair value	2,526,969		2,398,352
HTM, at amortized cost	1,256,423		1,267,922
Net loans	21,444,483		21,351,094
Less: ACL - loans	(297,888)		(293,404)
Loans, net	21,146,595		21,057,690
Net premises and equipment	213,541		222,881
Accrued interest receivable	107,089		107,972
Goodwill and net intangible assets	560,114		560,687
Other assets	1,342,632		1,267,138
Total Assets	$	27,642,957	$	27,571,915
LIABILITIES
Deposits:
Noninterest-bearing	$	5,086,514	$	5,314,094
Interest-bearing	16,655,436		16,223,529
Total Deposits	21,741,950		21,537,623
Borrowings:
Federal funds purchased	—		240,000
Federal Home Loan Bank advances	900,000		1,100,000
Senior debt and subordinated debt	535,566		535,384
Other borrowings	860,474		612,142
Total Borrowings	2,296,040		2,487,526
Accrued interest payable	26,362		35,083
Other liabilities	820,926		751,544
Total Liabilities	$	24,885,278	$	24,811,776
SHAREHOLDERS' EQUITY
Preferred stock, no par value, 10,000,000 shares authorized; Series A, 200,000 shares authorized and issued as of March 31, 2024 and December 31, 2023, liquidation preference of $1,000 per share	192,878		192,878
Common stock, $2.50 par value, 600,000,000 shares authorized, 225,900,447 shares issued as of March 31, 2024 and 225,760,963 shares issued as of December 31, 2023	564,751		564,402
Additional paid-in capital	1,554,624		1,552,860
Retained earnings	1,651,133		1,619,300
Accumulated other comprehensive loss	(319,468)		(312,280)
Treasury stock, at cost, 63,813,228 shares as of March 31, 2024 and 61,959,552 shares as of December 31, 2023	(886,239)		(857,021)
Total Shareholders' Equity	2,757,679		2,760,139
Total Liabilities and Shareholders' Equity	$	27,642,957	$	27,571,915
See Notes to Consolidated Financial Statements

7

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(dollars in thousands, except per-share data)	Three months ended March 31
	2024		2023
Interest Income
Loans, including fees	$	311,216	$	260,651
Investment securities	25,122		25,521
Other interest income	3,328		3,648
Total Interest Income	339,666		289,820
Interest Expense
Deposits	103,574		41,620
Federal funds purchased	2,388		6,035
Federal Home Loan Bank advances	10,949		15,473
Senior debt and subordinated debt	5,305		5,344
Other borrowings and interest-bearing liabilities	10,513		5,761
Total Interest Expense	132,729		74,233
Net Interest Income	206,937		215,587
Provision for credit losses	10,925		24,544
Net Interest Income After Provision for Credit Losses	196,012		191,043
Non-Interest Income
Wealth management	20,155		18,062
Commercial banking	18,829		17,513
Consumer banking	11,668		11,217
Mortgage banking	3,090		1,970
Other	3,398		2,968
Non-Interest Income Before Investment Securities (Losses) Gains, Net	57,140		51,730
Investment securities gains, net	—		23
Total Non-Interest Income	57,140		51,753
Non-Interest Expense
Salaries and employee benefits	95,481		89,283
Data processing and software	17,661		15,796
Net occupancy	16,149		14,438
Other outside services	13,283		10,126
FDIC insurance	6,104		4,795
Equipment	4,040		3,389
Professional fees	2,088		2,392
Marketing	1,912		1,886
Intangible amortization	573		674
Other	20,309		16,837
Total Non-Interest Expense	177,600		159,616
Income Before Income Taxes	75,552		83,180
Income taxes	13,611		14,866
Net Income	61,941		68,314
Preferred stock dividends	(2,562)		(2,562)
Net Income Available to Common Shareholders	$	59,379	$	65,752
PER SHARE:
Net income available to common shareholders (basic)	$	0.36	$	0.39
Net income available to common shareholders (diluted)	0.36		0.39
Cash dividends	0.17		0.15
See Notes to Consolidated Financial Statements

8

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(dollars in thousands)

	Three months ended March 31
	2024		2023
Net Income	$	61,941	$	68,314
Other Comprehensive Income/(Loss), net of tax:
Unrealized (losses) gains on AFS investment securities
Net unrealized holding (losses) gains	(16,665)		32,641
Reclassification adjustment for securities net change realized in net income	—		18
Amortization of net unrealized gains on AFS securities transferred to HTM	1,387		1,477
Net unrealized (losses) gains on AFS investment securities	(15,278)		34,136
Unrealized gains (losses) on interest rate derivatives used in cash flow hedges
Net unrealized holding gains (losses)	4,297		(5,213)
Reclassification adjustment for net change realized in net income	3,899		5,536
Net unrealized gains on interest rate derivatives used in cash flow hedges	8,196		323
Defined benefit pension plan and postretirement benefits
Amortization of net unrecognized pension and postretirement items	(106)		25
Other Comprehensive (Loss) Income	(7,188)		34,484
Total Comprehensive Income	$	54,753	$	102,798
See Notes to Consolidated Financial Statements

9

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (UNAUDITED)

(in thousands, except per-share data)

	Preferred Stock			Common Stock			Additional		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Total
	Shares Outstanding	Amount		Shares Outstanding	Amount		Paid-in Capital
Three months ended March 31, 2024
Balance at December 31, 2023	200	$	192,878	163,801	$	564,402	$	1,552,860	$	1,619,300	$	(312,280)	$	(857,021)	$	2,760,139
Net income									61,941						61,941
Other comprehensive loss											(7,188)				(7,188)
Common stock issued(1)				79	198		895						12		1,105
Dividend reinvestment activity				87			184						1,221		1,405
Stock-based compensation awards (repurchases)				54	151		685						(103)		733
Acquisition of treasury stock				(1,934)									(30,348)		(30,348)
Preferred stock dividend									(2,562)						(2,562)
Common stock dividends - $0.17 per share									(27,546)						(27,546)
Balance at March 31, 2024	200	$	192,878	162,087	$	564,751	$	1,554,624	$	1,651,133	$	(319,468)	$	(886,239)	$	2,757,679
Three months ended March 31, 2023
Balance at December 31, 2022	200	$	192,878	167,599	$	561,511	$	1,541,840	$	1,450,758	$	(385,476)	$	(781,754)	$	2,579,757
Net income									68,314						68,314
Other comprehensive loss											34,484				34,484
Common stock issued(1)				89	223		998						14		1,235
Dividend reinvestment activity				81			240						1,129		1,369
Stock-based compensation awards (repurchases)				39	119		1,680						(140)		1,659
Acquisition of treasury stock				(2,412)									(40,449)		(40,449)
Preferred stock dividend									(2,562)						(2,562)
Common stock dividends - $0.15 per share									(24,809)						(24,809)
Balance at March 31, 2023	200	$	192,878	165,396	$	561,853	$	1,544,758	$	1,491,701	$	(350,992)	$	(821,200)	$	2,618,998
See Notes to Consolidated Financial Statements

(1) Issuance of common stock includes issuance in connection with the Corporation’s Employee Stock Purchase Plan and exercised stock options.

10

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(dollars in thousands)	Three months ended March 31
	2024		2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	61,941	$	68,314
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses	10,925		24,544
Depreciation and amortization of premises and equipment	7,796		7,319
Net amortization of investment securities premiums	574		2,981
Investment securities gains, net	—		(23)
Gain on sales of mortgage loans held for sale	(1,697)		(656)
Proceeds from sales of mortgage loans held for sale	95,388		41,928
Originations of mortgage loans held for sale	(89,157)		(40,515)
Intangible amortization	573		674
Amortization of issuance costs and discounts on long-term borrowings	182		180
Loss on disposal of premises and equipment	3,313		137
Stock-based compensation	836		1,668
Net change in deferred federal income tax	(2,330)		28,174
Net change in accrued salaries and benefits	(14,771)		(24,436)
Net change in life insurance cash surrender value	(3,563)		(2,830)
Other changes, net	82,891		(61,496)
Total adjustments	90,960		(22,351)
Net cash provided by operating activities	152,901		45,963
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of AFS securities	—		80,362
Proceeds from principal repayments and maturities of AFS securities	14,216		28,627
Proceeds from principal repayments and maturities of HTM securities	13,015		15,103
Purchase of AFS securities	(208,968)		(64,996)
Net change in FRB and FHLB stock	2,768		22,581
Net change in loans	(101,987)		(404,842)
Net purchases of premises and equipment	(1,769)		(2,437)
Settlement of bank-owned life insurance	236		—
Net change in tax credit investments	(17,399)		(12,412)
Net cash used in investing activities	(299,888)		(338,014)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in demand and savings deposits	(200,119)		(390,376)
Net change in time deposits and brokered deposits	404,446		1,057,432
Net change in other borrowings	(191,668)		(424,617)
Net proceeds from issuance of common stock	1,002		2,595
Dividends paid	(28,703)		(27,702)
Acquisition of treasury stock	(30,348)		(40,449)
Net cash provided by (used in) financing activities	(45,390)		176,883
Net decrease in Cash and Cash Equivalents	(192,377)		(115,168)
Cash and Cash Equivalents at Beginning of Period	549,710		681,921
Cash and Cash Equivalents at End of Period	$	357,333	$	566,753
Supplemental Disclosures of Cash Flow Information:
Cash paid during the period for:
Interest	$	141,450	$	72,526
Income taxes	6,764		7,308
Supplemental Schedule of Certain Noncash Activities:
Unsettled maturities of AFS securities	$	42,500	$	—
See Notes to Consolidated Financial Statements

11

FULTON FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1 – Basis of Presentation

The accompanying unaudited Consolidated Financial Statements of the Corporation have been prepared in conformity with GAAP for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts of assets and liabilities as of the date of the financial statements as well as revenues and expenses during the period. Actual results could differ from those estimates. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and the notes thereto included in the Corporation's Annual Report on Form 10-K for the year ended December 31, 2023. Operating results for the three months ended March 31, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024. The Corporation evaluates subsequent events through the date of filing of this Quarterly Report on Form 10-Q with the SEC for potential recognition or disclosure in the Consolidated Financial Statements.

Significant Accounting Policies

The significant accounting policies used in preparation of the Consolidated Financial Statements are disclosed in the Corporation's 2023 Annual Report on Form 10-K. Those significant accounting policies are unchanged at March 31, 2024.

Recently Adopted Accounting Standards

In June 2022, FASB issued ASU 2022-03 Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions ("ASU 2022-03"). This update clarifies how the fair value of equity securities subject to contractual sale restrictions is determined and requires additional qualitative and quantitative disclosures for equity securities with contractual sale restrictions. The Corporation adopted ASU 2022-03 on January 1, 2024, and it did not have a material impact on its consolidated financial statements.

In March 2023, FASB issued ASU 2023-01 Leases (Topic 842): Common Control Arrangements ("ASU 2023-01"). This update clarifies guidance for leases between related parties under common control. The Corporation adopted ASU 2023-01 on January 1, 2024, and it did not have a material impact on its consolidated financial statements.

Recently Issued Accounting Standards

In November 2023, FASB issued ASU 2023-07 Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ("ASU 2023-04"). This update requires public entities with reportable segments to provide additional and more detailed disclosures. The Corporation will adopt ASU 2023-07 on December 15, 2024. The Corporation is not currently required to report segment information and, as such, does not expect the adoption of ASU 2023-07 to have an impact on its consolidated financial statements.

In December 2023, FASB issued ASU 2023-08 Intangibles - Goodwill and Other - Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets ("ASU 2023-08"). This update provides guidance for crypto assets to be carried at fair value and requires additional disclosures. The Corporation will adopt ASU 2023-08 on January 1, 2025. The Corporation does not expect the adoption of ASU 2023-08 to have an impact on its consolidated financial statements. The Corporation currently does not hold crypto assets.

In December 2023, FASB issued ASU 2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"). This update requires companies to disclose specific categories in the income tax rate reconciliation and requires additional information for certain reconciling items. The Corporation will adopt ASU 2023-09 on January 1, 2025. The Corporation does not expect the adoption of ASU 2023-09 to have an impact on its consolidated financial statements.

In March 2024, FASB issued ASU 2024-01 Compensation - Stock Compensation (Topic 718): Scope Application of Profits Interest and Similar Awards ("ASU 2024-01"). This update provides guidance for profits interest and similar awards. The Corporation will adopt ASU 2024-01 on January 1, 2025. The Corporation does not expect the adoption of ASU 2024-01 to have a material impact on its consolidated financial statements.

12

In March 2024, FASB issued ASU 2024-02 Codification Improvements - Amendments to Remove References to the Concepts Statements ("ASU 2024-02"). This update contains amendments that remove references to various Concepts Statements. The Corporation will adopt ASU 2024-02 on January 1, 2025. The Corporation does not expect the adoption of ASU 2024-02 to have an impact on its consolidated financial statements.

Reclassifications

Certain amounts in the 2023 consolidated financial statements and notes have been reclassified to conform to the 2024 presentation.

NOTE 2 – Restrictions on Cash and Cash Equivalents

Cash collateral is posted by the Corporation with counterparties to secure derivatives and other contracts, which is included in "interest-bearing deposits with other banks" on the consolidated balance sheets. The amounts of such collateral as of March 31, 2024 and December 31, 2023 were $11.0 million and $17.4 million, respectively.

NOTE 3 – Investment Securities

The following table presents the amortized cost and estimated fair values of investment securities:

	March 31, 2024
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Available for Sale	(dollars in thousands)
U.S. Government-sponsored agency securities	$	1,035	$	—	$	(37)	$	998
State and municipal securities	1,198,180		390		(146,311)		1,052,259
Corporate debt securities	480,803		1,060		(37,596)		444,267
Collateralized mortgage obligations	199,510		160		(12,242)		187,428
Residential mortgage-backed securities	347,116		342		(30,626)		316,832
Commercial mortgage-backed securities	621,778		—		(96,593)		525,185
Total	$	2,848,422	$	1,952	$	(323,405)	$	2,526,969
Held to Maturity
Residential mortgage-backed securities	$	396,308	$	—	$	(58,245)	$	338,063
Commercial mortgage-backed securities	860,115		—		(151,246)		708,869
Total	$	1,256,423	$	—	$	(209,491)	$	1,046,932

13

	December 31, 2023
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Available for Sale	(dollars in thousands)
U.S. Government securities	$	42,475	$	—	$	(314)	$	42,161
U.S. Government-sponsored agency securities	1,038		—		(28)		1,010
State and municipal securities	1,200,571		1,089		(129,647)		1,072,013
Corporate debt securities	480,714		473		(40,636)		440,551
Collateralized mortgage obligations	122,824		—		(11,390)		111,434
Residential mortgage-backed securities	223,273		7		(26,485)		196,795
Commercial mortgage-backed securities	627,364		—		(92,976)		534,388
Total	$	2,698,259	$	1,569	$	(301,476)	$	2,398,352
Held to Maturity
Residential mortgage-backed securities	$	407,075	$	—	$	(51,805)	$	355,270
Commercial mortgage-backed securities	860,847		—		(143,910)		716,937
Total	$	1,267,922	$	—	$	(195,715)	$	1,072,207

Securities carried at $0.6 billion and $0.4 billion at March 31, 2024 and December 31, 2023, respectively, were pledged as collateral to secure public and trust deposits.

The amortized cost and estimated fair values of debt securities as of March 31, 2024, by contractual maturity, are shown in the following table. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay with or without call or prepayment penalties.

		March 31, 2024
		Available for Sale				Held to Maturity
		Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
	(dollars in thousands)
Due in one year or less		$	9,342	$	9,403	$	—	$	—
Due from one year to five years		180,221		171,975		—		—
Due from five years to ten years		486,781		453,657		—		—
Due after ten years		1,003,674		862,489		—		—
		1,680,018		1,497,524		—		—
Residential mortgage-backed securities(1)		347,116		316,832		396,308		338,063
Commercial mortgage-backed securities(1)		621,778		525,185		860,115		708,869
Collateralized mortgage obligations(1)		199,510		187,428		—		—
Total		$	2,848,422	$	2,526,969	$	1,256,423	$	1,046,932

(1) Maturities for mortgage-backed securities and collateralized mortgage obligations are dependent upon the interest rate environment and prepayments on the

underlying loans.

The following table presents information related to gross realized gains and losses on the sales of securities:

	Gross Realized Gains		Gross Realized Losses		Net Gains (Losses)
Three months ended	(dollars in thousands)
March 31, 2024	$	—	$	—	$	—
March 31, 2023	283		(260)		23

14

The following tables present the gross unrealized losses and estimated fair values of investment securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position:

	March 31, 2024
		Less than 12 months					12 months or longer				Total
	Number of Securities	Estimated Fair Value		Unrealized Losses		Number of Securities	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
Available for Sale	(dollars in thousands)
U.S. Government-sponsored agency securities	—	$	—	$	—	1	$	998	$	(37)	$	998	$	(37)
State and municipal securities	40	82,963		(1,072)		336	942,914		(145,239)		1,025,877		(146,311)
Corporate debt securities	3	15,247		(753)		64	392,222		(36,843)		407,469		(37,596)
Collateralized mortgage obligations	2	19,916		(56)		93	105,859		(12,186)		125,775		(12,242)
Residential mortgage-backed securities	15	18,591		(29)		69	187,840		(30,597)		206,431		(30,626)
Commercial mortgage-backed securities	—	—		—		135	525,185		(96,593)		525,185		(96,593)
Total available for sale	60	$	136,717	$	(1,910)	698	$	2,155,018	$	(321,495)	$	2,291,735	$	(323,405)
Held to Maturity
Residential mortgage-backed securities	—	$	—	$	—	120	$	338,063	$	(58,245)	$	338,063	$	(58,245)
Commercial mortgage-backed securities	—	—		—		60	708,869		(151,246)		708,869		(151,246)
Total held to maturity	—	$	—	$	—	180	$	1,046,932	$	(209,491)	$	1,046,932	$	(209,491)

	December 31, 2023
	Less than 12 months					12 months or longer					Total
	Number of Securities	Estimated Fair Value		Unrealized Losses		Number of Securities	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
Available for Sale	(dollars in thousands)
U.S. Government Securities	—	$	—	$	—	1	$	42,161	$	(314)	$	42,161	$	(314)
U.S. Government-sponsored agency securities	—	—		—		1	1,010		(28)		1,010		(28)
State and municipal securities	40	76,155		(858)		314	917,274		(128,789)		993,429		(129,647)
Corporate debt securities	8	42,945		(1,326)		60	370,523		(39,310)		413,468		(40,636)
Collateralized mortgage obligations	—	—		—		93	111,434		(11,390)		111,434		(11,390)
Residential mortgage-backed securities	6	409		(3)		69	195,453		(26,482)		195,862		(26,485)
Commercial mortgage-backed securities	2	26,907		(1,053)		133	507,481		(91,923)		534,388		(92,976)
Total available for sale	56	$	146,416	$	(3,240)	671	$	2,145,336	$	(298,236)	$	2,291,752	$	(301,476)
Held to Maturity
Residential mortgage-backed securities	—	$	—	$	—	120	$	355,270	$	(51,805)	$	355,270	$	(51,805)
Commercial mortgage-backed securities	—	—		—		60	716,937		(143,910)		716,937		(143,910)
Total held to maturity	—	$	—	$	—	180	$	1,072,207	$	(195,715)	$	1,072,207	$	(195,715)

The Corporation's collateralized mortgage obligations, residential mortgage-backed securities and commercial mortgage-backed securities have contractual terms that generally do not permit the issuer to settle the securities at a price less than the amortized cost of the investment. The change in fair value of these securities is attributable to changes in interest rates and not credit quality. The Corporation does not have the intent to sell and does not believe it will more likely than not be required to sell any of these securities prior to a recovery of their fair value to amortized cost. Therefore, the Corporation does not have an ACL for these investments as of March 31, 2024 and December 31, 2023.

As of March 31, 2024 and December 31, 2023, no ACL was required for the Corporation's state and municipal securities. The Corporation does not have the intent to sell and does not believe it will more likely than not be required to sell any of these securities prior to a recovery of their fair value to amortized cost, which may be at maturity.

15

The majority of the corporate debt securities were rated at or above investment grade as of March 31, 2024 and December 31, 2023. The Corporation does not have the intent to sell and does not believe it will more likely than not to be required to sell any of these securities prior to a recovery of their fair value to amortized cost, which may be at maturity. Based on the payment status, rating and management's evaluation of these securities, no ACL was required for corporate debt securities as of March 31, 2024 and December 31, 2023.

NOTE 4 - Loans and Allowance for Credit Losses

Loans and leases, net of unearned income

Loans and leases, net of unearned income, are summarized as follows:

	March 31, 2024		December 31, 2023
	(dollars in thousands)
Real estate - commercial mortgage	$	8,252,117	$	8,127,728
Commercial and industrial(1)	4,467,589		4,545,552
Real-estate - residential mortgage	5,395,720		5,325,923
Real-estate - home equity	1,040,335		1,047,184
Real-estate - construction	1,249,199		1,239,075
Consumer	698,421		729,318
Leases and other loans(2)	341,102		336,314
Net loans	$	21,444,483	$	21,351,094

(1) Includes no unearned income for March 31, 2024 and $41.0 thousand at December 31, 2023.

(2) Includes unearned income of $38.0 million at March 31, 2024 and December 31, 2023.

Allowance for Credit Losses

The ACL consists of reserves against loans that have been evaluated collectively and individually for expected credit losses. The ACL represents an estimate of expected credit losses over the expected life of the loans as of the balance sheet date and is recorded as a reduction to net loans. The ACL is increased by charges to expense, through the provision for credit losses, and decreased by charge-offs, net of recoveries. The reserve for OBS credit exposures includes estimated losses on unfunded loan commitments, letters of credit and other OBS credit exposures.

The following table summarizes the ACL - loans balance and the reserve for OBS credit exposures balance:

	March 31, 2024		December 31, 2023
	(dollars in thousands)
ACL - loans	$	297,888	$	293,404
Reserve for OBS credit exposures(1)	$	15,097	$	17,254

(1) Included in other liabilities on the consolidated balance sheets.

16

The following table presents the activity in the ACL - loans balances:

	Three months ended March 31
	2024		2023
	(dollars in thousands)
Balance at beginning of period	$	293,404	$	269,366
Loans charged off	(10,952)		(16,903)
Recoveries of loans previously charged off	2,354		2,899
Net loans (charged off) recovered	(8,598)		(14,004)
Provision for credit losses(1)	13,082		23,333
Balance at end of period	297,888		278,695
Provision for OBS credit exposures	(2,157)		1,211
Reserve for OBS credit exposures	$	15,097	$	17,539

(1) Provision only includes the portion related to net loans.

The following table presents the activity in the ACL by portfolio segment:

	Real Estate  Commercial Mortgage		Commercial and Industrial		Real Estate Residential Mortgage		Consumer and Home Equity		Real Estate Construction		Leases and other loans		Total
	(dollars in thousands)
Three months ended March 31, 2024
Balance at December 31, 2023	$	112,565	$	74,266	$	73,286	$	17,604	$	12,295	$	3,388	$	293,404
Loans charged off	(26)		(7,632)		(251)		(2,238)		—		(805)		(10,952)
Recoveries of loans previously charged off	152		1,248		116		676		—		162		2,354
Net loans (charged off) recovered	126		(6,384)		(135)		(1,562)		—		(643)		(8,598)
Provision for loan losses(1)	1,801		9,001		65		646		671		898		13,082
Balance at March 31, 2024	$	114,492	$	76,883	$	73,216	$	16,688	$	12,966	$	3,643	$	297,888
Three months ended March 31, 2023
Balance at December 31, 2022	$	69,456	$	70,116	$	83,250	$	26,429	$	10,743	$	9,372	$	269,366
Loans charged off	(13,362)		(612)		—		(2,206)		—		(723)		(16,903)
Recoveries of loans previously charged off	786		1,086		48		661		202		116		2,899
Net loans (charged off) recovered	(12,576)		474		48		(1,545)		202		(607)		(14,004)
Provision for loan and lease losses(1)	9,376		6,536		2,911		2,419		701		1,390		23,333
Balance at March 31, 2023	$	66,256	$	77,126	$	86,209	$	27,303	$	11,646	$	10,155	$	278,695

(1) Provision included in the table only includes the portion related to net loans.

The ACL may include qualitative adjustments intended to capture the impact of uncertainties not reflected in the quantitative models. In determining qualitative adjustments, management considers changes in national, regional, and local economic and business conditions and their impact on the lending environment, including underwriting standards and other factors affecting credit losses over the remaining life of each loan.

The increases in ACL - loans for the first quarter of 2024 were related to loan growth and risk migration.

Collateral-Dependent Loans

A loan or a lease is considered to be collateral-dependent when the debtor is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral. For all classes of loans and leases deemed collateral-dependent, the Corporation elected the practical expedient to estimate expected credit losses based on the collateral’s fair value less cost to sell. In most cases, the Corporation records a partial charge-off to reduce the collateral-dependent loan or lease's carrying value to the collateral’s fair value less cost to sell. Substantially all of the collateral supporting collateral-dependent loans or leases consists of various types of real estate, including residential properties, commercial properties, such as retail centers, office buildings, and lodging, agricultural land, and vacant land.

17

All loans individually evaluated for impairment are measured for losses on a quarterly basis. As of March 31, 2024 and December 31, 2023, substantially all of the Corporation's individually evaluated loans with total commitments greater than or equal to $1.0 million were measured based on the estimated fair value of each loan’s collateral, if any. Collateral could be in the form of real estate, in the case of commercial mortgages and construction loans, or business assets, such as accounts receivables or inventory, in the case of commercial and industrial loans. Commercial and industrial loans may also be secured by real estate.

As of March 31, 2024 and December 31, 2023, approximately 84% and 78%, respectively, of loans evaluated individually for impairment with principal balances greater than or equal to $1.0 million, whose primary collateral consisted of real estate, were measured at estimated fair value using appraisals performed by state certified third-party appraisers that had been updated in the preceding 12 months.

Non-accrual Loans

The following table presents total non-accrual loans, by class segment:

	March 31, 2024						December 31, 2023
	With a Related Allowance		Without a Related Allowance		Total		With a Related Allowance		Without a Related Allowance		Total
	(dollars in thousands)
Real estate - commercial mortgage	$	31,912	$	14,049	$	45,961	$	23,338	$	21,467	$	44,805
Commercial and industrial	17,774		25,961		43,735		12,410		27,542		39,952
Real estate - residential mortgage	21,217		2,028		23,245		18,806		2,018		20,824
Real estate - home equity	5,164		95		5,259		4,649		104		4,753
Real estate - construction	340		946		1,286		341		1,000		1,341
Consumer	51		—		51		52		—		52
Leases and other loans	432		9,659		10,091		9,255		638		9,893
	$	76,890	$	52,738	$	129,628	$	68,851	$	52,769	$	121,620

As of March 31, 2024 and December 31, 2023, there were $52.7 million and $52.8 million, respectively, of non-accrual loans that did not have a specific valuation allowance within the ACL. The estimated fair values of the collateral securing these loans exceeded their carrying amount, or the loans were previously charged down to realizable collateral values. Accordingly, no specific valuation allowance was considered to be necessary.

Asset Quality

Maintaining an appropriate ACL is dependent on various factors, including the ability to identify potential problem loans in a timely manner. For commercial construction, commercial and industrial, and commercial real estate, an internal risk rating process is used. The Corporation believes that internal risk ratings are the most relevant credit quality indicator for these types of loans. The migration of loans through the various internal risk categories is a significant component of the ACL methodology for these loans, which bases the probability of default on this migration. Assigning risk ratings involves judgment. The Corporation's loan review officers provide a separate assessment of risk rating accuracy. Risk ratings may be changed based on the ongoing monitoring procedures performed by loan officers or credit administration staff, or if specific loan review assessments identify a deterioration or an improvement in a loan.

18

The following table summarizes designated internal risk rating categories by portfolio segment and loan class, by origination year, in the current period:

		March 31, 2024
		(dollars in thousands)
		Term Loans Amortized Cost Basis by Origination Year												Revolving Loans		Revolving Loans converted to Term Loans
														Amortized		Amortized
		2024		2023		2022		2021		2020		Prior		Cost Basis		Cost Basis		Total
Real estate - commercial mortgage
	Pass	$	144,685	$	821,641	$	986,101	$	1,188,735	$	980,105	$	3,486,974	$	54,703	$	—	$	7,662,944
	Special Mention	226		1,793		44,169		141,371		10,370		138,537		3,485		897		340,848
	Substandard or Lower	218		6,622		33,988		35,564		50,009		120,983		941		—		248,325
	Total real estate - commercial mortgage	145,129		830,056		1,064,258		1,365,670		1,040,484		3,746,494		59,129		897		8,252,117
Real estate - commercial mortgage
	Current period gross charge-offs	—		—		—		—		—		—		—		(26)		(26)
Commercial and industrial
	Pass	127,723		557,669		578,694		317,053		328,636		813,618		1,363,249		15,558		4,102,200
	Special Mention	3,598		7,317		4,914		11,961		4,288		29,121		60,971		—		122,170
	Substandard or Lower	1,962		5,733		25,849		9,091		3,723		52,592		139,180		5,089		243,219
	Total commercial and industrial	133,283		570,719		609,457		338,105		336,647		895,331		1,563,400		20,647		4,467,589
Commercial and industrial
	Current period gross charge-offs	—		—		—		—		—		—		(3,997)		(3,635)		(7,632)
Real estate - construction(1)
	Pass	29,344		402,019		283,072		207,525		2,334		41,288		14,146		—		979,728
	Special Mention	—		—		13,023		9,250		—		—		—		—		22,273
	Substandard or Lower	—		—		605		—		—		23,651		148		—		24,404
	Total real estate - construction	29,344		402,019		296,700		216,775		2,334		64,939		14,294		—		1,026,405
Real estate - construction(1)
	Current period gross charge-offs	—		—		—		—		—		—		—		—		—
Total
	Pass	$	301,752	$	1,781,329	$	1,847,867	$	1,713,313	$	1,311,075	$	4,341,880	$	1,432,098	$	15,558	$	12,744,872
	Special Mention	3,824		9,110		62,106		162,582		14,658		167,658		64,456		897		485,291
	Substandard or Lower	2,180		12,355		60,442		44,655		53,732		197,226		140,269		5,089		515,948
	Total	$	307,756	$	1,802,794	$	1,970,415	$	1,920,550	$	1,379,465	$	4,706,764	$	1,636,823	$	21,544	$	13,746,111

(1) Excludes real estate - construction - other.

19

The following table summarizes designated internal risk rating categories by portfolio segment and loan class, by origination year, in the prior period:

		December 31, 2023
		(dollars in thousands)
		Term Loans Amortized Cost Basis by Origination Year												Revolving Loans		Revolving Loans converted to Term Loans
														Amortized		Amortized
		2023		2022		2021		2020		2019		Prior		Cost Basis		Cost Basis		Total
Real estate - commercial mortgage
	Pass	$	783,673	$	993,017	$	1,203,852	$	984,958	$	721,857	$	2,822,155	$	59,253	$	31,636	$	7,600,401
	Special Mention	2,767		43,904		105,185		7,862		35,289		105,786		1,760		—		302,553
	Substandard or Lower	366		20,958		31,304		49,142		26,579		95,621		804		—		224,774
	Total real estate - commercial mortgage	786,806		1,057,879		1,340,341		1,041,962		783,725		3,023,562		61,817		31,636		8,127,728
Real estate - commercial mortgage
	Current period gross charge-offs	—		—		—		—		—		(424)		—		(17,575)		(17,999)
Commercial and industrial
	Pass	626,386		590,132		330,576		341,218		272,126		598,838		1,443,203		10,736		4,213,215
	Special Mention	7,936		9,548		16,499		3,577		6,817		18,487		72,775		198		135,837
	Substandard or Lower	247		25,184		4,611		3,843		18,988		31,663		105,230		6,734		196,500
	Total commercial and industrial	634,569		624,864		351,686		348,638		297,931		648,988		1,621,208		17,668		4,545,552
Commercial and industrial
	Current period gross charge-offs	—		(299)		—		—		—		(249)		(682)		(8,016)		(9,246)
Real estate - construction(1)
	Pass	322,922		258,080		261,583		37,426		9,510		34,097		13,677		—		937,295
	Special Mention	—		12,622		25,898		—		—		—		—		—		38,520
	Substandard or Lower	—		521		2,229		—		340		21,284		168		2,229		26,771
	Total real estate - construction	322,922		271,223		289,710		37,426		9,850		55,381		13,845		2,229		1,002,586
Real estate - construction(1)
	Current period gross charge-offs	—		—		—		—		—		—		—		—		—
Total
	Pass	$	1,732,981	$	1,841,229	$	1,796,011	$	1,363,602	$	1,003,493	$	3,455,090	$	1,516,133	$	42,372	$	12,750,911
	Special Mention	10,703		66,074		147,582		11,439		42,106		124,273		74,535		198		476,910
	Substandard or Lower	613		46,663		38,144		52,985		45,907		148,568		106,202		8,963		448,045
	Total	$	1,744,297	$	1,953,966	$	1,981,737	$	1,428,026	$	1,091,506	$	3,727,931	$	1,696,870	$	51,533	$	13,675,866

(1) Excludes real estate - construction - other.

20

The Corporation considers the performance of the loan portfolio and its impact on the ACL. The Corporation does not assign internal risk ratings to smaller balance, homogeneous loans, such as home equity, residential mortgage, construction loans to individuals secured by residential real estate, consumer and other loans. For these loans, the most relevant credit quality indicator is delinquency status and the Corporation evaluates credit quality based on the aging status of the loan. The following tables present the amortized cost of these loans based on payment activity, by origination year, for the periods shown:

		March 31, 2024
		(dollars in thousands)
		Term Loans Amortized Cost Basis by Origination Year												Revolving Loans		Revolving Loans converted to Term Loans
														Amortized		Amortized
		2024		2023		2022		2021		2020		Prior		Cost Basis		Cost Basis		Total
Real estate - residential mortgage
	Performing	$	67,011	$	646,785	$	1,155,113	$	1,667,801	$	969,671	$	848,654	$	—	$	—	$	5,355,035
	Nonperforming	—		377		2,178		3,967		4,456		29,707		—		—		40,685
	Total real estate - residential mortgage	67,011		647,162		1,157,291		1,671,768		974,127		878,361		—		—		5,395,720
Real estate - residential mortgage
	Current period gross charge-offs	—		—		—		—		—		—		—		(251)		(251)
Consumer and real estate - home equity
	Performing	139,457		141,600		258,843		80,885		57,456		224,865		803,859		21,619		1,728,584
	Nonperforming	—		76		698		478		342		5,790		1,119		1,669		10,172
	Total consumer and real estate - home equity	139,457		141,676		259,541		81,363		57,798		230,655		804,978		23,288		1,738,756
Consumer and real estate - home equity
	Current period gross charge-offs	—		—		—		—		—		(401)		—		(1,837)		(2,238)
Leases and other loans
	Performing	73,190		112,516		79,168		25,088		19,865		21,141		—		—		330,968
	Nonperforming	—		—		408		—		23		9,703		—		—		10,134
	Leases and other loans	73,190		112,516		79,576		25,088		19,888		30,844		—		—		341,102
Leases and other loans
	Current period gross charge-offs	(13)		(259)		(90)		(62)		(32)		(173)		—		(176)		(805)
Construction - other
	Performing	10,366		142,825		60,623		7,118		—		—		—		—		220,932
	Nonperforming	—		—		1,862		—		—		—		—		—		1,862
	Total construction - other	10,366		142,825		62,485		7,118		—		—		—		—		222,794
Construction - other
	Current period gross charge-offs	—		—		—		—		—		—		—		—		—
Total
	Performing	$	290,024	$	1,043,726	$	1,553,747	$	1,780,892	$	1,046,992	$	1,094,660	$	803,859	$	21,619	$	7,635,519
	Nonperforming	—		453		5,146		4,445		4,821		45,200		1,119		1,669		62,853
	Total	$	290,024	$	1,044,179	$	1,558,893	$	1,785,337	$	1,051,813	$	1,139,860	$	804,978	$	23,288	$	7,698,372

21

		December 31, 2023
		(dollars in thousands)
		Term Loans Amortized Cost Basis by Origination Year												Revolving Loans		Revolving Loans converted to Term Loans
														Amortized		Amortized
		2023		2022		2021		2020		2019		Prior		Cost Basis		Cost Basis		Total
Real estate - residential mortgage
	Performing	$	623,247	$	1,126,656	$	1,682,759	$	984,050	$	260,049	$	607,133	$	—	$	—	$	5,283,894
	Nonperforming	—		1,720		4,888		4,701		6,233		24,487		—		—		42,029
	Total real estate - residential mortgage	623,247		1,128,376		1,687,647		988,751		266,282		631,620		—		—		5,325,923
Real estate - residential mortgage
	Current period gross charge-offs	—		—		—		—		—		—		—		(62)		(62)
Consumer and Real estate - home equity
	Performing	272,571		276,373		85,985		62,426		37,667		204,913		805,645		20,044		1,765,624
	Nonperforming	295		455		866		282		354		5,526		1,439		1,661		10,878
	Total consumer and real estate - home equity	272,866		276,828		86,851		62,708		38,021		210,439		807,084		21,705		1,776,502
Consumer and Real estate - home equity
	Current period gross charge-offs	(119)		—		—		—		—		(525)		(283)		(6,587)		(7,514)
Leases and other loans
	Performing	166,490		83,641		27,755		22,304		16,246		9,867		—		—		326,303
	Nonperforming	—		118		—		—		—		9,893		—		—		10,011
	Leases and other loans	166,490		83,759		27,755		22,304		16,246		19,760		—		—		336,314
Leases and other loans
	Current period gross charge-offs	(471)		(521)		(246)		(128)		(82)		(656)		(765)		(1,511)		(4,380)
Construction - other
	Performing	127,382		93,319		13,698		555		—		—		—		—		234,954
	Nonperforming	—		1,535		—		—		—		—		—		—		1,535
	Total construction - other	127,382		94,854		13,698		555		—		—		—		—		236,489
Construction - other
	Current period gross charge-offs	—		—		—		—		—		—		—		—		—
Total
	Performing	$	1,189,690	$	1,579,989	$	1,810,197	$	1,069,335	$	313,962	$	821,913	$	805,645	$	20,044	$	7,610,775
	Nonperforming	295		3,828		5,754		4,983		6,587		39,906		1,439		1,661		64,453
	Total	$	1,189,985	$	1,583,817	$	1,815,951	$	1,074,318	$	320,549	$	861,819	$	807,084	$	21,705	$	7,675,228

22

The following table presents non-performing assets:

	March 31, 2024		December 31, 2023
	(dollars in thousands)
Non-accrual loans	$	129,628	$	121,620
Loans 90 days or more past due and still accruing	26,521		31,721
Total non-performing loans	156,149		153,341
OREO(1)	277		896
Total non-performing assets	$	156,426	$	154,237

(1) Excludes $19.0 million and $10.9 million of residential mortgage properties for which formal foreclosure proceedings were in process as of March 31,

2024 and December 31, 2023, respectively.

The following tables present the aging of the amortized cost basis of loans, by class segment:

	30-59		60-89		≥ 90 Days
	Days Past		Days Past		Past Due		Non-
	Due		Due		and Accruing		Accrual		Current		Total
	(dollars in thousands)
March 31, 2024
Real estate - commercial mortgage	$	8,129	$	2,795	$	1,930	$	45,961	$	8,193,302	$	8,252,117
Commercial and industrial(1)	6,262		2,777		383		43,735		4,414,432		4,467,589
Real estate - residential mortgage	42,664		7,130		17,440		23,245		5,305,241		5,395,720
Real estate - home equity	5,954		2,852		4,077		5,259		1,022,193		1,040,335
Real estate - construction	987		297		1,862		1,286		1,244,767		1,249,199
Consumer	6,641		1,602		785		51		689,342		698,421
Leases and other loans(1)	213		159		44		10,091		330,595		341,102
Total	$	70,850	$	17,612	$	26,521	$	129,628	$	21,199,872	$	21,444,483

(1) Includes unearned income.

	30-59 Days Past Due		60-89 Days Past Due		≥ 90 Days Past Due and Accruing		Non- accrual		Current		Total
	(dollars in thousands)
December 31, 2023
Real estate - commercial mortgage	$	4,408	$	1,341	$	1,722	$	44,805	$	8,075,452	$	8,127,728
Commercial and industrial(1)	5,620		1,656		1,068		39,952		4,497,256		4,545,552
Real estate - residential mortgage	49,145		10,838		21,205		20,824		5,223,911		5,325,923
Real estate - home equity	8,142		2,075		5,326		4,753		1,026,888		1,047,184
Real estate - construction	4,185		451		1,535		1,341		1,231,563		1,239,075
Consumer	8,361		1,767		747		52		718,391		729,318
Leases and other loans(1)	146		722		118		9,893		325,435		336,314
Total	$	80,007	$	18,850	$	31,721	$	121,620	$	21,098,896	$	21,351,094

(1) Includes unearned income.

Loan Modifications to Borrowers Experiencing Financial Difficulty

The Corporation modifies loans by providing a concession when deemed appropriate. Depending on the circumstances, a term extension, interest rate reduction or principal forgiveness may be granted. In certain instances a combination of concessions may be provided to a borrower.

23

When principal forgiveness is provided, the amount of principal forgiven is deemed to be uncollectible and the amortized cost basis of the loan is reduced by the amount of the forgiven portion, with a corresponding reduction to the ACL.

The following table presents the amortized cost basis of the loans modified to borrowers experiencing financial difficulty, disaggregated by class of financing receivable and type of concession granted:

	Term Extension
	Three months ended March 31, 2024				Three months ended March 31, 2023
	Amortization Cost Basis		% of Class of Financing Receivable		Amortization Cost Basis		% of Class of Financing Receivable
	(dollars in thousands)
Real estate - commercial mortgage	$	—	—	%	$	1,426	0.02	%
Commercial and industrial	—		—		6,227		0.14
Real estate - residential mortgage	2,717		0.05		1,182		0.02
Real estate - construction	455		0.04		—		—
Total	$	3,172			$	8,835

	Interest Rate Reduction and Term Extension
	Three months ended March 31, 2024				Three months ended March 31, 2023
	Amortized Cost Basis		% of Class of Financing Receivable		Amortized Cost Basis		% of Class of Financing Receivable
	(dollars in thousands)
Real estate - residential mortgage	$	465	0.01	%	$	—	—	%
Total	$	465			$	—

The following table presents the financial effect of the modifications made to borrowers experiencing financial difficulty:

	Term Extension
	Financial Effect
Three months ended March 31, 2024
Real estate - residential mortgage	Added a weighted-average 6.27 years to the life of loans, which reduced monthly payment amounts for the borrowers.
Real estate - construction	Added a weighted-average 0.67 years to the life of loans, which reduced monthly payment amounts for the borrowers.
Three months ended March 31, 2023
Real estate - commercial mortgage	Added a weighted-average 1.91 years to the life of loans, which reduced monthly payment amounts for the borrowers.
Commercial and industrial	Added a weighted-average 0.77 years to the life of loans, which reduced monthly payment amounts for the borrowers.
Real estate - residential mortgage	Added a weighted-average 3.51 years to the life of loans, which reduced monthly payment amounts for the borrowers.

	Interest Rate Reduction1
	Financial Effect
Three months ended March 31, 2024
Real estate - residential mortgage	Reduced weighted-average interest rate from 4.37% to 2.71%

1 There were no loan modifications with interest rate reductions for the three months ended March 31, 2023.

24

During the three months ended March 31, 2024 and 2023, there were no loans modified due to financial difficulty where there was a principal balance forgiveness.

The following table presents the performance of loans that have been modified due to financial difficulty in the previous 12 months:

			30-89		90+		Total
			Days Past		Past Due		Past
	Current		Due		and Accruing		Due
March 31, 2024	(dollars in thousands)
Commercial and industrial	$	8,498	$	—	$	—	$	—
Real estate - residential mortgage	10,084		1,043		283		1,326
Real estate - construction	455		—		—		—
Total	$	19,037	$	1,043	$	283	$	1,326

There were no commitments to lend additional funds to borrowers with loan modifications as a result of financial difficulty as of March 31, 2024.

NOTE 5 – Mortgage Servicing Rights

The following table summarizes the changes in MSRs, which are included in other assets on the consolidated balance sheets, with adjustments to the carrying value included in mortgage banking income on the consolidated statements of income:

	Three months ended March 31
	2024		2023
	(dollars in thousands)
Amortized cost:
Balance at beginning of period	$	31,602	$	34,217
Originations of MSRs	582		196
Amortization	(1,127)		(1,331)
Balance at end of period	$	31,057	$	33,082
Valuation allowance:
Balance at beginning of period	$	—	$	—
Reduction (addition) to valuation allowance	—		—
Balance at end of period	$	—	$	—
Net MSRs at end of period	$	31,057	$	33,082
Estimated fair value of MSRs at end of period	$	51,191	$	47,223

MSRs represent the economic value of contractual rights to service mortgage loans that have been sold. The total portfolio of mortgage loans serviced by the Corporation for unrelated third parties was $4.0 billion and $4.1 billion as of March 31, 2024 and December 31, 2023, respectively. Actual and expected prepayments of the underlying mortgage loans can impact the fair values of the MSRs. The Corporation accounts for MSRs at the lower of amortized cost or fair value.

The fair value of MSRs is estimated by discounting the estimated cash flows from servicing income, net of expense, over the expected life of the underlying loans at a discount rate commensurate with the risk associated with these assets. Expected life is based on the contractual terms of the loans, as adjusted for prepayment projections. The fair values of MSRs were $51.2 million and $49.7 million as of March 31, 2024 and December 31, 2023, respectively. Based on its fair value analysis as of March 31, 2024, the Corporation determined that no valuation allowance was required as of March 31, 2024.

25

NOTE 6 – Derivative Financial Instruments

The Corporation uses derivatives to manage its exposure to certain market risk, including interest rate and foreign currency risks, and to assist customers with their risk management objectives. Certain of the Corporation's outstanding derivative contracts are designated as hedges, and none are entered into for speculative purposes. The Corporation enters into derivative contracts that are intended to economically hedge certain of its risks, even if hedge accounting does not apply or the Corporation elects not to apply hedge accounting.

In January 2023, the Corporation terminated interest rate derivatives designated as cash flow hedges with a combined notional amount of $1.0 billion. As the hedged transaction continues to be probable, the original unrealized loss of $70.6 million included in AOCI will be recognized as a reduction to interest income when the previously forecasted hedged item affects earnings in future periods. During the three months ended March 31, 2024, $7.0 million of these unrealized losses have been reclassified as a reduction of interest income on loans, including fees, on the Corporation's consolidated statements of income.

In the third quarter of 2023, the Corporation transitioned certain of the Corporation's legacy commercial customer back-to-back interest rate swap transactions from LIBOR to SOFR. For the three months ended March 31, 2024, the increase to other non-interest income to reflect market valuation movements from the transition from LIBOR to SOFR was $0.2 million. For the year ended December 31, 2023, the full-year reduction to other non-interest income related to the transition from LIBOR to SOFR was $1.9 million.

For additional information on our derivative accounting policies see Note 1 "Summary of Significant Accounting Policies" in our 2023 Annual Report on Form 10-K.

26

The following table presents a summary of the notional amounts and fair values of derivative financial instruments:

	March 31, 2024				December 31, 2023
	Notional Amount		Asset (Liability) Fair Value		Notional Amount		Asset (Liability) Fair Value
	(dollars in thousands)
Interest Rate Locks with Customers
Positive fair values	$	164,041	$	763	$	119,558	$	460
Negative fair values	1,018		(4)		1,015		(2)
Forward Commitments
Positive fair values	48,250		11		—		—
Negative fair values	—		—		42,000		(854)
Interest Rate Derivatives with Customers
Positive fair values	622,369		8,264		824,659		22,656
Negative fair values	4,044,521		(272,875)		3,784,236		(222,530)
Interest Rate Derivatives with Dealer Counterparties(1)
Positive fair values	4,044,521		164,762		3,784,236		128,235
Negative fair values	622,369		(8,630)		824,659		(23,023)
Interest Rate Derivatives used in Cash Flow Hedges
Positive fair values	2,300,000		1,060		2,500,000		6,189
Negative fair values	950,000		(72)		750,000		—
Foreign Exchange Contracts with Customers
Positive fair values	16,861		396		4,159		40
Negative fair values	4,192		(179)		13,353		(446)
Foreign Exchange Contracts with Correspondent Banks
Positive fair values	5,656		222		15,969		532
Negative fair values	18,449		(304)		6,112		(31)

(1) Fair Values are net of a valuation allowance of $366.3 thousand as of March 31, 2024 and December 31, 2023.

The following table presents the effect of cash flow hedge accounting on AOCI:

	Amount of Gain (Loss) Recognized in OCI on Derivative		Amount of Gain (Loss) Recognized in OCI Included Component		Amount of Gain (Loss) Recognized in OCI Excluded Component		Location of Gain (Loss) Recognized from AOCI into Income	Amount of Gain (Loss) Reclassified from AOCI into Income		Amount of Gain (Loss) Reclassified from AOCI into Income Included Component		Amount of Gain (Loss) Reclassified from AOCI into Income Excluded Component
	(dollars in thousands)
Three months ended March 31, 2024
Interest Rate Products	$	(5,659)	$	(5,659)	$	—	Interest Income	$	(7,032)	$	(7,032)	$	—
Interest Rate Products	11,215		11,215		—		Interest Expense	2,020		2,020		—
Total	$	5,556	$	5,556	$	—		$	(5,012)	$	(5,012)	$	—
Three months ended March 31, 2023
Interest Rate Products	$	12,535	$	12,535	—		Interest Income	$	(7,157)	$	(7,157)	—
Total	$	12,535	$	12,535	—			$	(7,157)	$	(7,157)	—

27

During the next twelve months, the Corporation estimates that an additional $19.7 million of unrealized losses will be reclassified as a decrease to net interest income.

The following table presents the effect of fair value and cash flow hedge accounting on the income statement:

	Consolidated Statements of Income Classification
	2024				2023
	Interest Income		Interest Expense		Interest Income		Interest Expense
	(dollars in thousands)
Three months ended March 31
Total amounts of income line items presented in the consolidated statements of income in which the effects of fair value or cash flow hedges are recorded	$	(7,032)	$	2,020	$	(7,157)	$	—
Interest contracts:
Amount of gain (loss) reclassified from AOCI into income	(7,032)		2,020		(7,157)		—
Amount of gain or (loss) reclassified from AOCI into income as a result that a forecasted transaction is no longer probable of occurring	—		—		—		—
Amount of gain (loss) reclassified from AOCI into income - included component	(7,032)		2,020		(7,157)		—
Amount of gain (loss) reclassified from AOCI into income - excluded component	—		—		—		—

The following table presents a summary of the net fair value gains (losses) on derivative financial instruments:

	Consolidated Statements of Income Classification	Three months ended March 31
		2024		2023
		(dollars in thousands)
Mortgage banking derivatives(1)	Mortgage banking income	$	1,167	$	394
Interest rate derivatives	Other income	151		—
Foreign exchange contracts	Other income	39		91
Net fair value gains/(losses) on derivative financial instruments		$	1,357	$	485

(1) Includes interest rate locks with customers and forward commitments.

Fair Value Option

The Corporation has elected to measure mortgage loans held for sale at fair value. The following table presents a summary of mortgage loans held for sale and the impact of the fair value election on the consolidated financial statements:

	March 31, 2024		December 31, 2023
	(dollars in thousands)
Amortized cost(1)	$	10,434	$	14,792
Fair value	10,624		15,158

(1) Cost basis of mortgage loans held for sale represents the unpaid principal balance.

Losses related to changes in fair values of mortgage loans held for sale were $0.2 million for the three months ended March 31, 2024 compared to gain of $0.1 million for the three months ended March 31, 2023. The gains and losses are recorded on the consolidated income statements as adjustments to mortgage banking income.

28

Balance Sheet Offsetting

The fair values of interest rate derivative agreements and foreign exchange contracts the Corporation enters into with customers and dealer counterparties may be eligible for offset on the consolidated balance sheets if they are subject to master netting arrangements or similar agreements. The Corporation has elected to net its financial assets and liabilities designated as interest rate derivatives when offsetting is permitted. The following table presents the Corporation's financial instruments that are eligible for offset, and the effects of offsetting, on the consolidated balance sheets:

	Gross Amounts		Gross Amounts Not Offset
	Recognized		on the Consolidated
	on the		Balance Sheets
	Consolidated		Financial		Cash		Net
	Balance Sheets		Instruments(1)		Collateral(2)		Amount
	(dollars in thousands)
March 31, 2024
Interest rate derivative assets	$	174,086	$	(9,663)	$	—	$	164,423
Foreign exchange derivative assets with correspondent banks	222		(222)		—		—
Total	$	174,308	$	(9,885)	$	—	$	164,423
Interest rate derivative liabilities	$	281,577	$	(10,651)	$	(109,005)	$	161,921
Foreign exchange derivative liabilities with correspondent banks	304		(222)		—		82
Total	$	281,881	$	(10,873)	$	(109,005)	$	162,003
December 31, 2023
Interest rate derivative assets	$	157,080	$	(15,154)	$	—	$	141,926
Foreign exchange derivative assets with correspondent banks	532		(532)		—		—
Total	$	157,612	$	(15,686)	$	—	$	141,926
Interest rate derivative liabilities	$	245,553	$	(21,343)	$	(93,841)	$	130,369
Foreign exchange derivative liabilities with correspondent banks	31		(532)		—		(501)
Total	$	245,584	$	(21,875)	$	(93,841)	$	129,868

(1) For interest rate derivative assets, amounts represent any derivative liability fair values that could be offset in the event of counterparty or customer default.

For interest rate derivative liabilities, amounts represent any derivative asset fair values that could be offset in the event of counterparty or customer default.

(2) Amounts represent cash collateral received from the counterparty or posted by the Corporation on interest rate derivative transactions and foreign exchange

contracts with financial institution counterparties. Interest rate derivatives with customers are collateralized by the same collateral securing the underlying

loans to those borrowers. Cash and securities collateral amounts are included in the table only to the extent of the net derivative fair values.

29

NOTE 7 – Accumulated Other Comprehensive (Loss) Income

The following table presents the components of other comprehensive income (loss):

	Before-Tax Amount		Tax Effect		Net of Tax Amount
	(dollars in thousands)
Three months ended March 31, 2024
Net unrealized losses on securities	$	(21,546)	$	4,881	$	(16,665)
Amortization of net unrealized gains on AFS securities transferred to HTM(1)	1,793		(406)		1,387
Net unrealized holding gains arising during the period on interest rate derivatives used in cash flow hedges	5,556		(1,259)		4,297
Reclassification adjustment for net change realized in net income on interest rate derivatives used in cash flow hedges	5,012		(1,113)		3,899
Amortization of net unrecognized pension and postretirement items(2)	(135)		29		(106)
Total Other Comprehensive Loss	$	(9,320)	$	2,132	$	(7,188)
Three months ended March 31, 2023
Net unrealized gains on securities	$	42,199	$	(9,558)	$	32,641
Reclassification adjustment for securities net change included in net income(3)	23		(5)		18
Amortization of net unrealized gains on AFS securities transferred to HTM(1)	1,910		(433)		1,477
Net unrealized holding gains arising during the period on interest rate derivatives used in cash flow hedges	12,535		(17,748)		(5,213)
Reclassification adjustment for net change realized in net income on interest rate derivatives used in cash flow hedges	7,157		(1,621)		5,536
Amortization of net unrecognized pension and postretirement items(2)	32		(7)		25
Total Other Comprehensive Loss	$	63,856	$	(29,372)	$	34,484

(1) Amounts reclassified out of AOCI. Before-tax amounts included as a reduction to "Interest Income" on the Consolidated Statements of Income.

(2) Amounts reclassified out of AOCI. Before-tax amounts included in "Salaries and employee benefits" on the Consolidated Statements of Income. See "Note

11 - Employee Benefit Plans," for additional details.

(3) Amounts reclassified out of AOCI. Before-tax amounts included in "Investment securities gains, net" on the Consolidated Statements of Income. See "Note 3

- Investment Securities," for additional details.

The following table presents changes in each component of accumulated other comprehensive income (loss), net of tax:

	Unrealized Gains (Losses) on Investment Securities		Net Unrealized Gain (Loss) on Interest Rate Derivatives used in Cash Flow Hedges		Unrecognized Pension and Postretirement Plan Income (Costs)		Total
	(dollars in thousands)
Three months ended March 31, 2024
Balance at December 31, 2023	$	(274,862)	$	(34,783)	$	(2,635)	$	(312,280)
OCI before reclassifications	(16,665)		4,297		—		(12,368)
Amounts reclassified from AOCI	—		3,899		(106)		3,793
Amortization of net unrealized gains on AFS securities transferred to HTM	1,387		—		—		1,387
Balance at March 31, 2024	$	(290,140)	$	(26,587)	$	(2,741)	$	(319,468)
Three months ended March 31, 2023
Balance at December 31, 2022	$	(316,231)	$	(61,776)	$	(7,469)	$	(385,476)
OCI before reclassifications	32,641		—		—		32,641
Amounts reclassified from AOCI	18		323		25		366
Amortization of net unrealized losses on AFS securities transferred to HTM	1,477		—		—		1,477
Balance at March 31, 2023	$	(282,095)	$	(61,453)	$	(7,444)	$	(350,992)

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NOTE 8 – Fair Value Measurements

FASB ASC Topic 820 establishes a fair value hierarchy for the inputs to valuation techniques used to measure assets and liabilities at fair value using the following three categories (from highest to lowest priority):

•Level 1 – Inputs that represent quoted prices for identical instruments in active markets.

•Level 2 – Inputs that represent quoted prices for similar instruments in active markets or quoted prices for identical instruments in non-active markets. Also includes valuation techniques whose inputs are derived principally from observable market data other than quoted prices, such as interest rates or other market-corroborated means.

•Level 3 – Inputs that are largely unobservable, as little or no market data exists for the instrument being valued.

All assets and liabilities measured at fair value on both a recurring and nonrecurring basis have been categorized into the above three levels. The following tables present assets and liabilities measured at fair value on a recurring basis and reported on the consolidated balance sheets:

	March 31, 2024
	Level 1		Level 2		Level 3		Total
	(dollars in thousands)
Loans held for sale	$	—	$	10,624	$	—	$	10,624
Available for sale investment securities:
U.S. Government-sponsored agency securities	—		998		—		998
State and municipal securities	—		1,052,259		—		1,052,259
Corporate debt securities	—		444,267		—		444,267
Collateralized mortgage obligations	—		187,428		—		187,428
Residential mortgage-backed securities	—		316,832		—		316,832
Commercial mortgage-backed securities	—		525,185		—		525,185
Total available for sale investment securities	—		2,526,969		—		2,526,969
Other assets:
Investments held in Rabbi Trust	32,562		—		—		32,562
Derivative assets	618		174,860		—		175,478
Total assets	$	33,180	$	2,712,453	$	—	$	2,745,633
Other liabilities:
Deferred compensation liabilities	$	32,562	$	—	$	—	$	32,562
Derivative liabilities	483		281,581		—		282,064
Total liabilities	$	33,045	$	281,581	$	—	$	314,626

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	December 31, 2023
	Level 1		Level 2		Level 3		Total
	(dollars in thousands)
Loans held for sale	$	—	$	15,158	$	—	$	15,158
Available for sale investment securities:
U.S. Government securities	42,161		—		—		42,161
U.S. Government sponsored agency securities	—		1,010		—		1,010
State and municipal securities	—		1,072,013		—		1,072,013
Corporate debt securities	—		440,551		—		440,551
Collateralized mortgage obligations	—		111,434		—		111,434
Residential mortgage-backed securities	—		196,795		—		196,795
Commercial mortgage-backed securities	—		534,388		—		534,388
Total available for sale investment securities	42,161		2,356,191		—		2,398,352
Other assets:
Investments held in Rabbi Trust	29,819		—		—		29,819
Derivative assets	572		157,540		—		158,112
Total assets	$	72,552	$	2,528,889	$	—	$	2,601,441
Other liabilities:
Deferred compensation liabilities	$	29,819	$	—	$	—	$	29,819
Derivative liabilities	477		246,157		—		246,634
Total liabilities	$	30,296	$	246,157	$	—	$	276,453

The valuation techniques used to measure fair value for the items in the preceding tables are as follows:

Loans held for sale – This category includes mortgage loans held for sale that are measured at fair value. Fair values as of March 31, 2024 and December 31, 2023, were measured at the price that secondary market investors were offering for loans with similar characteristics.

Available for sale investment securities – Included in this asset category are debt securities. Level 2 investment securities are valued by a third-party pricing service. The pricing service uses pricing models that vary based on asset class and incorporate available market information, including quoted prices of investment securities with similar characteristics. Because many fixed income securities do not trade on a daily basis, pricing models use available information, as applicable, through processes such as benchmark yield curves, benchmarking of like securities, sector groupings and matrix pricing.

Standard market inputs include: benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data, including market research publications. For certain security types, additional inputs may be used, or some of the standard market inputs may not be applicable.

•U.S. Government securities – These securities are classified as Level 1. Fair values are based on quoted prices with active markets.

•U.S. Government-sponsored agency securities, State and municipal securities/Collateralized mortgage obligations/Residential mortgage-backed securities/Commercial mortgage-backed securities – These debt securities are classified as Level 2. Fair values are determined by a third-party pricing service, as detailed above.

•Corporate debt securities – This category consists of subordinated debt and senior debt issued by financial institutions ($437.1 million at March 31, 2024 and $433.4 million at December 31, 2023) and other corporate debt issued by non-financial institutions ($7.2 million at March 31, 2024 and December 31, 2023).

Level 2 investments include subordinated debt and senior debt, and other corporate debt issued by non-financial institutions at March 31, 2024 and December 31, 2023. The fair values for these corporate debt securities are determined by a third-party pricing service, as detailed above.

32

Investments held in Rabbi Trust – This category consists of mutual funds that are held in trust for employee deferred compensation plans that the Corporation has elected to measure at fair value. Shares of mutual funds are valued based on net asset value, which represent quoted market prices for the underlying shares held in the mutual funds, and as such, are classified as Level 1.

Derivative assets – Fair value of foreign currency exchange contracts are classified as Level 1 assets ($0.6 million at March 31, 2024 and December 31, 2023). The mutual funds and foreign exchange prices used to measure these items at fair value are based on quoted prices for identical instruments in active markets.

Level 2 assets, representing the fair value of mortgage banking derivatives in the form of interest rate locks and forward commitments with secondary market investors ($0.8 million at March 31, 2024 and $0.5 million at December 31, 2023) and the fair value of interest rate derivatives ($174.1 million at March 31, 2024 and $157.1 million at December 31, 2023). The fair values of the interest rate locks, forward commitments and interest rate derivatives represent the amounts that would be required to settle the derivative financial instruments at the balance sheet date. See "Note 6 - Derivative Financial Instruments," for additional information.

Deferred compensation liabilities – Fair value of amounts due to employees under deferred compensation plans, classified as Level 1 liabilities and are included in other liabilities on the consolidated balance sheets. The fair values of these liabilities are determined in the same manner as the related assets, as described under the heading "Investments held in Rabbi Trust" above.

Derivative liabilities – Level 1 liabilities, representing the fair value of foreign currency exchange contracts ($0.5 million at March 31, 2024 and December 31, 2023).

Level 2 liabilities, representing the fair value of mortgage banking derivatives in the form of interest rate locks and forward commitments with secondary market investors ($0 at March 31, 2024 and $0.9 million at December 31, 2023) and the fair value of interest rate derivatives ($281.6 million at March 31, 2024 and $245.6 million at December 31, 2023).

The fair values of these liabilities are determined in the same manner as the related assets, as described under the heading "Derivative assets" above.

Certain financial instruments are not measured at fair value on an ongoing basis but are subject to fair value measurement in certain circumstances, such as upon their acquisition or when there is evidence of impairment. The following table presents Level 3 financial assets measured at fair value on a nonrecurring basis:

	March 31, 2024		December 31, 2023
	(dollars in thousands)
Loans, net	$	107,915	$	102,135
OREO	277		896
MSRs(1)	51,191		49,696
Total assets	$	159,383	$	152,727

(1) Amounts shown are estimated fair value. MSRs are recorded on the Corporation's consolidated balance sheets at the lower of amortized cost or fair value.

See "Note 5 - Mortgage Servicing Rights" for additional information.

The valuation techniques used to measure fair value for the items in the table above are as follows:

•Loans, net – This category consists of loans that were individually evaluated for impairment and have been classified as Level 3 assets. The amount shown is the balance of non-accrual loans, net of related ACL. See "Note 4 - Loans and Allowance for Credit Losses," for additional details.

•OREO – This category consists of OREO classified as Level 3 assets, for which the fair values were based on estimated selling prices less estimated selling costs for similar assets in active markets.

33

•MSRs – This category consists of MSRs, which were initially recorded at fair value upon the sale of residential mortgage loans to secondary market investors, and subsequently carried at the lower of amortized cost or fair value. MSRs are amortized as a reduction to servicing income over the estimated lives of the underlying loans. MSRs are stratified by product type and evaluated for impairment by comparing each stratum's carrying amount to its estimated fair value. Fair values are determined at the end of each quarter through a discounted cash flows valuation performed by a third-party valuation expert. Significant inputs to the valuation included expected net servicing income, the discount rate and the expected life of the underlying loans. Expected life is based on the contractual terms of the loans, as adjusted for prepayment projections. The weighted average annual constant prepayment rate and the weighted average discount rate used in the March 31, 2024 valuation were 7.3% and 9.5%, respectively. Management reviews the reasonableness of the significant inputs to the third-party valuation in comparison to market data. See "Note 5 - Mortgage Servicing Rights," for additional information.

The following tables detail the book values and the estimated fair values of the Corporation's financial instruments:

	March 31, 2024
			Estimated Fair Value
	Carrying Amount		Level 1		Level 2		Level 3		Total
	(dollars in thousands)
FINANCIAL ASSETS
Cash and cash equivalents	$	357,333	$	357,333	$	—	$	—	$	357,333
FRB and FHLB stock	121,637		—		121,637		—		121,637
Loans held for sale	10,624		—		10,624		—		10,624
AFS securities	2,526,969		—		2,526,969		—		2,526,969
HTM securities	1,256,423		—		1,046,932		—		1,046,932
Loans, net	21,146,595		—		—		20,044,269		20,044,269
Accrued interest receivable	107,089		107,089		—		—		107,089
Other assets	764,332		558,210		174,860		51,468		784,538
FINANCIAL LIABILITIES
Demand and savings deposits	$	17,453,569	$	17,453,569	$	—	$	—	$	17,453,569
Brokered deposits	1,152,427		144,960		1,006,416		—		1,151,376
Time deposits	3,135,954		—		3,123,531		—		3,123,531
Accrued interest payable	26,362		26,362		—		—		26,362
Federal Home Loan Bank advances	900,000		903,194		—		—		903,194
Senior debt and subordinated debt	535,566		—		420,502		—		420,502
Other borrowings	860,474		859,662		750		—		860,412
Other liabilities	463,030		166,352		281,581		15,097		463,030

34

	December 31, 2023
			Estimated Fair Value
	Carrying Amount		Level 1		Level 2		Level 3		Total
	(dollars in thousands)
FINANCIAL ASSETS
Cash and cash equivalents	$	549,710	$	549,710	$	—	$	—	$	549,710
FRB and FHLB stock	124,405		—		124,405		—		124,405
Loans held for sale	15,158		—		15,158		—		15,158
AFS securities	2,398,352		42,161		2,356,191		—		2,398,352
HTM securities	1,267,922		—		1,072,207		—		1,072,207
Loans, net	21,057,690		—		—		19,930,560		19,930,560
Accrued interest receivable	107,972		107,972		—		—		107,972
Other assets	661,067		452,935		157,540		50,592		661,067
FINANCIAL LIABILITIES
Demand and savings deposits	$	17,653,690	$	17,653,690	$	—	$	—	$	17,653,690
Brokered deposits	1,144,692		145,987		999,392		—		1,145,379
Time deposits	2,739,241		—		2,714,709		—		2,714,709
Accrued interest payable	35,083		35,083		—		—		35,083
Federal funds purchased	240,000		240,000		—		—		240,000
Federal Home Loan Bank advances	1,100,000		1,094,013		—		—		1,094,013
Senior debt and subordinated debt	535,384		—		463,270		—		463,270
Other borrowings	612,142		611,269		837		—		612,106
Other liabilities	429,046		165,635		246,157		17,254		429,046

Fair values of financial instruments are significantly affected by the assumptions used, principally the timing of future cash flows and discount rates. Because assumptions are inherently subjective in nature, the estimated fair values cannot be substantiated by comparison to independent market quotes and, in many cases, the estimated fair values could not necessarily be realized in an immediate sale or settlement of the instrument. The aggregate fair value amounts presented do not necessarily represent management’s estimate of the underlying value of the Corporation.

For short-term financial instruments, defined as those with remaining maturities of 90 days or less, and excluding those recorded at fair value on the Corporation's consolidated balance sheets, book value was considered to be a reasonable estimate of fair value.

The following instruments are predominantly short-term:

Assets	Liabilities
Cash and cash equivalents	Demand and savings deposits
Accrued interest receivable	Other borrowings
	Accrued interest payable

FRB and FHLB stock represent restricted investments and are carried at cost on the consolidated balance sheets, which is a reasonable estimate of fair value.

As of March 31, 2024, fair values for loans and time deposits were estimated by discounting future cash flows using the current rates, as adjusted for liquidity considerations, at which similar loans would be made to borrowers and similar deposits would be issued to customers for the same remaining maturities. Fair values of loans also include estimated credit losses that would be assumed in a market transaction, which represents estimated exit prices.

Brokered deposits consist of demand and saving deposits, which are classified as Level 1, and time deposits, which are classified as Level 2. The fair value of these deposits is determined in a manner consistent with the respective type of deposits discussed above.

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NOTE 9 – Net Income Per Share

Basic net income per share is calculated as net income available to common shareholders divided by the weighted average number of shares outstanding.

Diluted net income per share is calculated as net income available to common shareholders divided by the weighted average number of shares outstanding plus the incremental number of shares added as a result of converting common stock equivalents, calculated using the treasury stock method. The Corporation's common stock equivalents consist of outstanding stock options, restricted stock, RSUs, and PSUs. PSUs are required to be included in weighted average diluted shares outstanding if performance measures, as defined in each PSU award agreement, are met as of the end of the period.

A reconciliation of weighted average shares outstanding used to calculate basic and diluted net income per share follows (in thousands, except per share data):

	Three months ended March 31
	2024		2023
Weighted average shares outstanding (basic)	162,706		166,605
Impact of common stock equivalents	1,814		1,796
Weighted average shares outstanding (diluted)	164,520		168,401
Per share:
Basic	$	0.36	$	0.39
Diluted	0.36		0.39

NOTE 10 – Stock-Based Compensation

The Corporation grants equity awards to employees in the form of stock options, restricted stock, RSUs or PSUs under its Employee Equity Plan. In addition, employees may purchase stock under the Corporation's Employee Stock Purchase Plan. The fair value of equity awards granted to employees is recognized as compensation expense over the period during which employees are required to provide service in exchange for such awards.

The Corporation also grants equity awards to non-employee members of its board of directors and the Bank board of directors under the Directors’ Plan. Under the Directors’ Plan, the Corporation can grant equity awards to non-employee Corporation and Bank directors in the form of restricted stock, RSUs or common stock. Recent grants of equity awards under the Directors’ Plan have been limited to RSUs.

As of March 31, 2024, the Employee Equity Plan had approximately 4.5 million shares reserved for future grants through 2032, and the Directors’ Plan had approximately 395,000 shares reserved for future grants through 2033.

The following table presents compensation expense and the related tax benefits for equity awards recognized in the consolidated statements of income:

	Three months ended March 31
	2024		2023
	(dollars in thousands)
Compensation expense	$	667	$	1,668
Tax benefit	(144)		(362)
Total stock-based compensation, net of tax	$	523	$	1,306

36

NOTE 11 – Employee Benefit Plans

The net periodic pension cost for the Pension Plan consisted of the following components:

	Three months ended March 31
	2024		2023
	(dollars in thousands)
Interest cost	$	790	$	856
Expected return on plan assets	(976)		(877)
Net amortization and deferral	—		80
Net periodic pension cost	$	(186)	$	59

The components of the net benefit for the Postretirement Plan consisted of the following components:

	Three months ended March 31
	2024		2023
	(dollars in thousands)
Interest cost	$	10	$	13
Net accretion and deferral	(136)		(136)
Net periodic benefit	$	(126)	$	(123)

In connection with the Merger, the Corporation assumed the obligations of Prudential Bancorp under a multiemployer defined benefit pension plan that had previously been closed to new Prudential Bancorp participants.

The Corporation recognizes the funded status of its Pension Plan and Postretirement Plan on the consolidated balance sheets and recognizes the change in that funded status through OCI.

NOTE 12 – Commitments and Contingencies

Commitments

The Corporation is a party to financial instruments with OBS risk in the normal course of business to meet the financing needs of its borrowers or obligors.

Commitments to extend credit are agreements to lend to a borrower or obligor as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee by the borrower or obligor. Since a portion of the commitments is expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Corporation evaluates each borrower's or obligor's creditworthiness on a case-by-case basis. The amount of collateral, if any, obtained upon an extension of credit is based on management's credit evaluation of the borrower or obligor. Collateral held varies but may include accounts receivable, inventory, property, equipment and income-producing commercial properties.

Standby letters of credit are conditional commitments issued to guarantee the financial or performance obligation of a borrower or obligor to a third party. Commercial letters of credit are conditional commitments issued to facilitate foreign and domestic trade transactions for borrowers or obligors. The credit risk involved in issuing letters of credit is similar to that involved in extending loan facilities. These obligations are underwritten consistent with commercial lending standards. The maximum exposure to loss for standby and commercial letters of credit is equal to the contractual (or notional) amount of the instruments.

37

The following table presents the Corporation's commitments to extend credit and letters of credit:

	March 31, 2024		December 31, 2023
	(dollars in thousands)
Commitments to extend credit	$	8,778,133	$	8,790,511
Standby letters of credit	249,594		264,440
Commercial letters of credit	64,078		67,396

Residential Lending

The Corporation originates and sells residential mortgages to secondary market investors. The Corporation provides customary representations and warranties to secondary market investors that specify, among other things, that the loans have been underwritten to the standards of the secondary market investor. The Corporation may be required to repurchase specific loans or reimburse the investor for a credit loss incurred on a sold loan if it is determined that the representations and warranties have not been met. Under some agreements with secondary market investors, the Corporation may have additional credit exposure beyond customary representations and warranties, based on the specific terms of those agreements.

The Corporation maintains a reserve for estimated losses related to loans sold to investors. As of March 31, 2024 and December 31, 2023, the total reserve for losses on residential mortgage loans sold was $2.0 million and $1.8 million, respectively, including reserves for both representation and warranty and credit loss exposures. In addition, a component of ACL - OBS credit exposures of $1.9 million and $2.7 million, as of March 31, 2024 and December 31, 2023, respectively, related to additional credit exposures for potential loan repurchases.

Legal Proceedings

The Corporation is involved in various pending and threatened claims and other legal proceedings in the ordinary course of its business activities. The Corporation evaluates the possible impact of these matters, taking into consideration the most recent information available. A loss reserve is established for those matters for which the Corporation believes a loss is both probable and reasonably estimable. Once established, the reserve is adjusted as appropriate to reflect any subsequent developments. Actual losses with respect to any such matter may be more or less than the amount estimated by the Corporation. For matters where a loss is not probable, or the amount of the loss cannot be reasonably estimated by the Corporation, no loss reserve is established.

In addition, from time to time, the Corporation is involved in investigations or other forms of regulatory or governmental inquiry covering a range of possible issues and, in some cases, these may be part of similar reviews of the specified activities of other companies. These inquiries or investigations could lead to administrative, civil or criminal proceedings involving the Corporation, and could result in fines, penalties, restitution, other types of sanctions, or the need for the Corporation to undertake remedial actions, or to alter its business, financial or accounting practices. The Corporation's practice is to cooperate fully with regulatory and governmental inquiries and investigations.

As of the date of this report, the Corporation believes that any liabilities, individually or in the aggregate, that may result from the final outcomes of pending legal proceedings, or regulatory or governmental inquiries or investigations, will not have a material adverse effect on the financial condition of the Corporation. However, legal proceedings, inquiries and investigations are often unpredictable, and it is possible that the ultimate resolution of any such matters, if unfavorable, may be material to the Corporation's results of operations in any future period, depending, in part, upon the size of the loss or liability imposed and the operating results for the period, and could have a material adverse effect on the Corporation's business. In addition, regardless of the ultimate outcome of any such legal proceeding, inquiry or investigation, any such matter could cause the Corporation to incur additional expenses, which could be significant, and possibly material, to the Corporation's results of operations in any future period.

38

NOTE 13 – Subsequent Events

Acquisition of Substantially all of the Assets and Assumption of Substantially all of the Deposits and Certain Liabilities of Republic First Bank from the FDIC

On April 26, 2024, Fulton Bank acquired substantially all of the assets and assumed substantially all of the deposits and certain liabilities of Republic First Bank from the FDIC, as receiver for Republic First Bank. As part of the transaction, the Corporation acquired approximately $5.2 billion of assets of Republic First Bank, consisting of approximately $0.2 billion of cash, approximately $2.0 billion of investments (purchased at fair value), approximately $2.9 billion of loans, and approximately $0.1 billion of other assets. The Corporation also received approximately $0.8 billion of cash from the FDIC in connection with the Republic First Transaction. The Corporation assumed approximately $5.6 billion of total liabilities of Republic First Bank, including approximately $4.2 billion of deposits, approximately $1.3 billion of borrowings, and approximately $0.1 billion of other liabilities. The Corporation did not enter into a loss sharing arrangement with the FDIC in connection with the Republic First Transaction. Fulton Bank also has the option to purchase the Republic First Bank branches and office locations. Following the closing of the Republic First Transaction, the Corporation sold all of the acquired investment securities, and used $1.4 billion of the cash received from the sale of the investment securities to repay the assumed borrowings in their entirety and $250.0 million of the Corporation's wholesale funding sources.

The description of the Republic First Transaction and the value of the acquired assets and assumed liabilities are preliminary estimates based on information currently available to the Corporation and are subject to change. Information related to the assets and liabilities of Republic First Bank is based on information for Republic First Bank provided by the FDIC.

As a result of the Republic First Transaction, the Corporation enhanced its presence in Philadelphia, Pennsylvania and New Jersey.

In connection with the Republic First Transaction, Fulton Bank made a $5.0 million donation to the Fulton Forward Foundation to provide additional impact grants to nonprofit community organizations across the region that share Fulton’s vision of advancing economic empowerment, particularly in underserved communities.

Common Stock Offering

On May 1, 2024, the Corporation completed its previously announced underwritten public offering of 19,166,667 shares of its common stock at a price to the public of $15.00 per share, before underwriting discounts, which included 2,500,000 shares of common stock upon the exercise in full by the underwriters of their over-allotment option to purchase additional shares of common stock. The net proceeds to the Corporation from the offering before deducting transaction expenses were approximately $273.5 million.

The Corporation intends to use the net proceeds of the offering for general corporate purposes, including to support new opportunities in connection with the Republic First Transaction.

39

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

This Management's Discussion relates to the Corporation, a financial holding company registered under the BHCA and corporation incorporated under the laws of the Commonwealth of Pennsylvania, and its wholly owned subsidiaries. This Management's Discussion should be read in conjunction with the consolidated financial statements and other financial information presented in this report.

OVERVIEW

The Corporation is a financial holding company, which, through its wholly-owned banking subsidiary, provides a full range of retail and commercial financial services in Pennsylvania, Delaware, Maryland, New Jersey and Virginia.

The Corporation generates the majority of its revenue through net interest income, or the difference between interest earned on loans and investments and interest paid on deposits and borrowings. Growth in net interest income is dependent upon balance sheet growth and maintaining or increasing the NIM, which is FTE net interest income as a percentage of average interest-earning assets. The Corporation also generates revenue through fees earned on the various services and products offered to its customers and through gains on sales of assets, such as loans, investments and properties. Offsetting these revenue sources are provisions for credit losses on loans and OBS credit risks, non-interest expenses and income taxes.

The following table presents a summary of the Corporation's earnings and selected performance ratios:

	Three months ended March 31
	2024			2023
	(dollars in thousands, except per share data)
Net income	$	61,941		$	68,314
Net income available to common shareholders	59,379			65,752
Net income available to common shareholders (diluted)	0.36			0.39
Operating net income available to common shareholders per share(1)	0.40			0.39
Return on average assets, annualized	0.91		%	1.03		%
Operating return on average assets, annualized(1)	1.00		%	1.04		%
Return on average common shareholders' equity, annualized	9.28		%	11.02		%
Operating return on average common shareholders' equity (tangible), annualized(1)	13.08		%	14.46		%
Net interest margin(2)	3.32		%	3.53		%
Efficiency ratio(1)	63.2		%	58.5		%
Non-performing assets to total assets	0.57		%	0.62		%
Net charge-offs (recoveries) to average loans	0.16		%	0.27		%

(1) Ratio represents a financial measure derived by methods other than GAAP. See reconciliation of this non-GAAP financial measure to the most directly

comparable GAAP measure under the "Supplemental Reporting of Non-GAAP Based Financial Measures" section of Management's Discussion.

(2) Presented on a FTE basis, using a 21% federal tax rate and statutory interest expense disallowances.

Acquisition of Substantially all of the Assets and Assumption of Substantially all of the Deposits and Certain Liabilities of Republic First Bank from the FDIC

On April 26, 2024, Fulton Bank acquired substantially all of the assets and assumed substantially all of the deposits and certain liabilities of Republic First Bank from the FDIC, as receiver for Republic First Bank. As part of the transaction, the Corporation acquired approximately $5.2 billion of assets of Republic First Bank and assumed approximately $5.6 billion of liabilities of Republic First Bank, The Corporation received approximately $0.8 billion of cash from the FDIC in connection with the Republic First Transaction.

The description of the Republic First Transaction and the value of the acquired assets and assumed liabilities are preliminary estimates based on information currently available to the Corporation and are subject to change. Information related to the assets and liabilities of Republic First Bank is based on information for Republic First Bank provided by the FDIC.

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The consolidated financial statements contained in this report do not include the impact of the Republic First Transaction for the periods presented.

See "Note 13 - Subsequent Events" in the Notes to Consolidated Financial Statements in "Item 1. Financial Statements."

Common Stock Offering

On May 1, 2024, the Corporation completed its previously announced underwritten public offering of 19,166,667 shares of its common stock at a price to the public of $15.00 per share, before underwriting discounts, which included 2,500,000 shares of common stock upon the exercise in full by the underwriters of their over-allotment option to purchase additional shares of common stock. The net proceeds to the Corporation from the offering before deducting transaction expenses were approximately $273.5 million.

The Corporation intends to use the net proceeds of the offering for general corporate purposes, including to support new opportunities in connection with the Republic First Transaction.

Financial Highlights

Following is a summary of the financial highlights for the three months ended March 31, 2024:

•Net Income Available to Common Shareholders and Net Income Per Share - Net income available to common shareholders was $59.4 million for the three months ended March 31, 2024, a $6.4 million decrease compared to $65.8 million for the same period in 2023. Diluted net income available to common shareholders per share was $0.36 for the three months ended March 31, 2024, a $0.03 decrease compared to the same period in 2023.

•Net Interest Income - Net interest income was $206.9 million for the three months ended March 31, 2024, a decrease of $8.7 million, or 4.0%, compared to the same period in 2023. The decrease was primarily driven by rising interest rates resulting in an increase in interest expense from interest-bearing deposits, partially offset by an increase in interest income on loans.

•Net Interest Margin - For the three months ended March 31, 2024, NIM decreased to 3.32%, or 21 bps, compared to the same period in 2023, driven by a 95 bps increase in the cost of interest-bearing liabilities and noninterest-bearing deposits, partially offset by a 69 bps increase in the yield on net loans, a 11 bps increase in the yield on investment securities and a 236 bps increase in the yield on other interest-earning assets.

•Net Loans - Average net loans increased $906.9 million, or 4.4%, for the three months ended March 31, 2024 compared to the same period in 2023. The increase in average net loans was largely driven by increases in average residential mortgage loans and average commercial mortgage loans of $563.0 million and $445.0 million, respectively.

•Deposits - Average deposits increased $804.4 million, or 3.9%, for the three months ended March 31, 2024 compared to the same period in 2023. The increase in average deposits was largely due to increases in average time deposits of $1.3 billion, average brokered deposits of $643.7 million, average interest-bearing demand deposits of $270.2 million and average savings and money market deposits of $199.8 million, partially offset by a decrease in average noninterest-bearing demand deposits of $1.6 billion.

•Borrowings and Other Interest-Bearing Liabilities - Average borrowings and other interest-bearing liabilities decreased $450.3 million, or 14.7%, for the three months ended March 31, 2024 compared to the same period in 2023. The decrease in borrowings and other interest-bearing liabilities was primarily due to decreases in average FHLB advances and Federal funds purchased of $358.7 million and $331.5 million, respectively.

•Asset Quality - Non-performing assets increased $2.2 million, or 1.4%, as of March 31, 2024 compared to December 31, 2023, and were 0.57% and 0.56% of total assets as of those dates, respectively. Annualized net charge-offs to average loans outstanding was 0.16% for the three months ended March 31, 2024, compared to annualized net charge-offs to average loans outstanding of 0.27% for the same period in 2023. The provision for credit losses was $10.9 million for the three months ended March 31, 2024, compared to $24.5 million in the same period in 2023. Net charge-offs of $14.0 million for the three months ended March 31, 2023 included a charge-off of $13.3 million for a commercial office loan.

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•Non-interest Income - Compared to the three months ended March 31, 2023, non-interest income before investment securities gains (losses) increased $5.4 million, or 10.5%, from $51.7 million. The increase in non-interest income was primarily due to increases of $2.1 million in wealth management revenues due to an increase in assets under management, $1.3 million in commercial banking income, $1.1 million in mortgage banking income and $0.5 million in consumer banking income. The increase in commercial banking income was primarily due to increases of $0.8 million in cash management fee income and $0.3 million in gains on sale from SBA loans, reflected in other commercial banking income. The increase in mortgage banking income was driven by higher loan sale volumes and higher spreads.

•Non-interest Expense - Non-interest expense increased $18.0 million, or 11.3%, for the three months ended March 31, 2024 compared to the same period in 2023. Excluding FultonFirst implementation costs and loss on asset disposals of $6.3 million, non-interest expense increased $11.7 million, or 7.3%, compared to the same period in 2023. The increase was primarily due to increases of $6.0 million in salaries and employee benefits expense, $1.9 million in data processing and software expense primarily due to technology investments made in 2023, $1.7 million in net occupancy expense driven by snow removal costs, $1.3 million in FDIC insurance expense, which includes a $1.0 million special assessment charge to recover the loss to the Deposit Insurance Fund in connection with certain bank closures in 2023, and $0.7 million in other outside services expense. The $6.0 million increase in salaries and benefits expense was primarily due to merit increases and healthcare costs.

•Income Taxes - The Corporation's ETR was 18.0% for the three months ended March 31, 2024 compared to 18.5% for the full-year of 2023. The ETR is generally lower than the federal statutory rate of 21% due to tax-exempt interest income earned on loans, investments in tax-free municipal securities and investments in community development projects that generate tax credits under various programs.

Critical Accounting Policies

The Corporation's accounting policies are fundamental to understanding Management’s Discussion. Critical policies are those that the Corporation considers to be most important to the presentation of its financial condition and results of operations, because they require management's most difficult judgments as a result of the need to make estimates about the effects of matters that are inherently uncertain.

The Corporation's critical accounting policies are described in Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2023.

Supplemental Reporting of Non-GAAP Based Financial Measures

This Quarterly Report on Form 10-Q contains supplemental financial information, as detailed below, that has been derived by methods other than GAAP. The Corporation has presented these non-GAAP financial measures because it believes that these measures provide useful and comparative information to assess trends in the Corporation's results of operations. Presentation of these non-GAAP financial measures is consistent with how the Corporation evaluates its performance internally and these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the Corporation's industry. Management believes that these non-GAAP financial measures, in addition to GAAP measures, are also useful to investors to evaluate the Corporation's results. Investors should recognize that the Corporation's presentation of these non-GAAP financial measures might not be comparable to similarly titled measures of other companies. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures, and the Corporation strongly encourages a review of its consolidated financial statements in their entirety.

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Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measure follow:

	Three months ended March 31
	2024			2023
	(dollars in thousands, except per share data and share data)
Operating net income available to common shareholders
Net income available to common shareholders	$	59,379		$	65,752
Plus: Core deposit intangible amortization	441			514
Plus: Interest rate derivative transition valuation(1)	(151)			—
Plus: FDIC special assessment	956			—
Plus: FultonFirst implementation and asset disposals	6,329			—
Less: Tax impact of adjustments	(1,591)			(108)
Operating net income available to common shareholders (numerator)	$	65,363		$	66,158
Weighted average shares (diluted) (denominator)	164,520			168,401
Operating net income available to common shareholders, per share (diluted)	$	0.40		$	0.39
Operating return on average assets, annualized
Net income	$	61,941		$	68,314
Plus: Core deposit intangible amortization	441			514
Plus: Interest rate derivative transition valuation(1)	(151)			—
Plus: FDIC special assessment	956			—
Plus: FultonFirst implementation and asset disposals	6,329			—
Less: Tax impact of adjustments	(1,591)			(108)
Operating net income (numerator)	$	67,925		$	68,720
Total average assets	27,427,626			26,900,653
Less: Average net core deposit intangible	(4,666)			(6,937)
Total operating average assets	$	27,422,960		$	26,893,716
Operating return on average assets	1.00		%	1.04		%

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	Three months ended March 31
	2024			2023
	(dollars in thousands, except per share data and share data)
Operating return on average common shareholders' equity (tangible), annualized
Net income available to common shareholders	$	59,379		$	65,752
Plus: Intangible amortization	573			674
Plus: Interest rate derivative transition valuation(1)	(151)			—
Plus: FDIC special assessment	956			—
Plus: FultonFirst implementation and asset disposals	6,329			—
Less: Tax impact of adjustments	(1,618)			(142)
Adjusted net income available to common shareholders (numerator)	$	65,468		$	66,284
Average shareholders' equity	2,766,945			$	2,613,316
Less: Average preferred stock	(192,878)			(192,878)
Less: Average goodwill and intangible assets	(560,393)			(561,744)
Average tangible common shareholders' equity (denominator)	$	2,013,674		$	1,858,694
Operating return on average common shareholders' equity (tangible)	13.08		%	14.46		%
Efficiency ratio
Non-interest expense	$	177,600		$	159,616
Less: Intangible amortization	(573)			(674)
Less: FDIC special assessment	(956)			—
Less: FultonFirst implementation and asset disposals	(6,329)			—
Non-interest expense (numerator)	$	169,742		$	158,942
Net interest income	$	206,937		$	215,587
Tax equivalent adjustment	4,592			4,414
Plus: Total non-interest income	57,140			51,753
Plus: Interest rate derivative transition valuation(1)	(151)			—
Less: Investment securities (gains) losses, net	—			(23)
Total revenue (denominator)	$	268,518		$	271,731
Efficiency ratio	63.2		%	58.5		%
(1) Resulting from the reference rate transition from LIBOR to SOFR in the Corporation's commercial customer interest rate swap program.

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RESULTS OF OPERATIONS

Three months ended March 31, 2024 compared to the three months ended March 31, 2023

Net Interest Income

FTE net interest income was $211.5 million for the three months ended March 31, 2024, a decrease of $8.5 million, compared to $220.0 million for the same period in 2023. For the three months ended March 31, 2024, NIM decreased to 3.32%, or 21 bps, compared to the same period in 2023. The Corporation manages the risk associated with changes in interest rates through the techniques described within Item 3, "Quantitative and Qualitative Disclosures About Market Risk" in this Quarterly Report on Form 10-Q. The following table provides a comparative average balance sheet and net interest income analysis for those periods. Interest income and yields are presented on an FTE basis, using a 21% federal tax rate, and statutory interest expense disallowances. The discussion following this table is based on these taxable-equivalent amounts.

	Three months ended March 31
	2024						2023
	Average Balance		Interest (1)		Yield/ Rate		Average Balance		Interest (1)		Yield/ Rate
ASSETS	(dollars in thousands)
Interest-earning assets:
Net loans(2)	$	21,370,033	$	313,882	5.90	%	$	20,463,096	$	263,065	5.21	%
Investment securities(3)	3,983,753		27,048		2.71		4,289,643		27,522		2.60
Other interest-earning assets	249,079		3,328		5.36		493,130		3,648		3.00
Total interest-earning assets	25,602,865		344,258		5.40		25,245,869		294,235		4.73
Noninterest-earning assets:
Cash and due from banks	282,895						141,254
Premises and equipment	223,375						223,025
Other assets	1,614,746						1,563,806
Less: ACL - loans(4)	(296,255)						(273,301)
Total Assets	$	27,427,626					$	26,900,653
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
Demand deposits	$	5,596,725	$	20,500	1.47	%	$	5,326,566	$	8,455	0.64	%
Savings and money market deposits	6,669,228		38,797		2.34		6,469,468		20,535		1.29
Brokered deposits	1,083,382		14,655		5.44		439,670		5,173		4.77
Time deposits	2,968,344		29,622		4.01		1,696,878		7,458		1.78
Total interest-bearing deposits	16,317,679		103,574		2.55		13,932,582		41,621		1.21
Borrowings and other interest-bearing liabilities	2,608,376		29,155		4.46		3,058,684		32,613		4.32
Total interest-bearing liabilities	18,926,055		132,729		2.82		16,991,266		74,234		1.78
Noninterest-bearing liabilities:
Demand deposits	5,061,075						6,641,741
Other noninterest-bearing liabilities	673,551						654,330
Total Liabilities	24,660,681						24,287,337
Total Deposits	21,378,754				1.95	%	20,574,323				0.82	%
Total interest-bearing liabilities and non-interest bearing deposits	23,987,130				2.22	%	23,633,007				1.27	%
Shareholders’ equity	2,766,945						2,613,316
Total Liabilities and Shareholders’ Equity	$	27,427,626					$	26,900,653
Net interest income/FTE NIM			211,529		3.32	%			220,001		3.53	%
Tax equivalent adjustment			(4,592)						(4,414)
Net interest income			$	206,937					$	215,587

(1) Presented on a fully taxable-equivalent basis using a 21% federal tax rate and statutory interest expense disallowances.

(2) Average balance includes non-performing loans.

(3) Balances include amortized historical cost for AFS. The related unrealized holding gains (losses) are included in other assets.

(4) ACL - loans relates to the ACL specifically for net loans and does not include the ACL for OBS credit exposures, which is included in other liabilities.

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The following table summarizes the changes in FTE interest income and interest expense resulting from changes in average balances (volume) and changes in yields and rates for the three months ended March 31, 2024 in comparison to the same period in 2023:

	2024 vs. 2023 Increase (Decrease) due to change in
	Volume		Yield/Rate		Net
	(dollars in thousands)
FTE Interest income on:
Net loans(1)	$	12,700	$	38,117	$	50,817
Investment securities	(1,757)		1,283		(474)
Other interest-earning assets	(2,358)		2,038		(320)
Total interest income	$	8,585	$	41,438	$	50,023
Interest expense on:
Demand deposits	$	453	$	11,592	$	12,045
Savings and money market deposits	668		17,594		18,262
Brokered deposits	8,652		830		9,482
Time deposits	8,295		13,869		22,164
Borrowings and other interest-bearing liabilities	(4,579)		1,121		(3,458)
Total interest expense	$	13,489	$	45,006	$	58,495

(1) Average balance includes non-performing loans.

Note: Changes which are partially attributable to both volume and rate are allocated to the volume and rate components presented above based on the percentage of direct changes that are attributable to each component.

Compared to the first quarter of 2023, FTE total interest income for the first quarter of 2024 increased $50.0 million, or 17.0%, primarily due to an increase of $41.4 million attributable to changes in yield, of which $38.1 million related to net loans. The yield on average interest-earning assets increased 67 bps in the first quarter of 2024 compared to the same period in 2023. The increase due to changes in volume was due to an increase in average net loans, partially offset by decreases in average other interest-earning assets and average investment securities.

In the first quarter of 2024, interest expense increased $58.5 million compared to the first quarter of 2023, primarily driven by an increase in the rate on interest-bearing liabilities resulting in a $45.0 million increase in interest expense. The increase in interest expense attributable to rate was driven by increases in the rates on savings and money market deposits, time deposits and demand deposits. The increase in interest expense attributable to volume was primarily due to increases in average brokered deposits and average time deposits, partially offset by a decrease in average borrowings and other interest-bearing liabilities.

Average loans and average FTE yields, by type, are summarized in the following table:

	Three months ended March 31
	2024				2023				Increase (Decrease)
	Balance		Yield		Balance		Yield		$		%
	(dollars in thousands)
Real estate – commercial mortgage	$	8,166,018	6.34	%	$	7,720,975	5.55	%	$	445,043	5.8	%
Commercial and industrial	4,517,179		6.67		4,565,923		5.75		(48,744)		(1.1)
Real estate – residential mortgage	5,353,905		3.96		4,790,868		3.58		563,037		11.8
Real estate – home equity	1,039,321		7.34		1,086,032		6.37		(46,711)		(4.3)
Real estate – construction	1,240,640		7.44		1,276,145		6.29		(35,505)		(2.8)
Consumer	721,523		6.45		721,248		5.38		275		—
Leases and other loans(1)	331,447		4.69		301,905		4.09		29,542		9.8
Total loans	$	21,370,033	5.90	%	$	20,463,096	5.21	%	$	906,937	4.4	%

(1) Consists of equipment lease financing, overdrafts and net origination fees and costs.

During the first quarter of 2024, average loans increased $906.9 million, or 4.4%, compared to the same period in 2023. The increase in average loans was largely driven by increases in average residential mortgage loans and average commercial

46

mortgage loans of $563.0 million and $445.0 million, respectively. The yield on total loans increased 69 bps to 5.90% for the first quarter of 2024, compared to 5.21% for the same period in 2023, primarily due to rising interest rates.

Average deposits and average interest rates, by type, are summarized in the following table:

	Three months ended March 31
	2024				2023				Increase (Decrease)
	Balance		Rate		Balance		Rate		$		%
	(dollars in thousands)
Noninterest-bearing demand	$	5,061,075	—	%	$	6,641,741	—	%	$	(1,580,666)	(23.8)	%
Interest-bearing demand	5,596,725		1.47		5,326,566		0.64		270,159		5.1
Savings and money market deposits	6,669,228		2.34		6,469,468		1.29		199,760		3.1
Total demand deposits and savings and money market deposits	17,327,028		1.38		18,437,775		0.64		(1,110,747)		(6.0)
Brokered deposits	1,083,382		5.44		439,670		4.77		643,712		1.5
Time deposits	2,968,344		4.01		1,696,878		1.78		1,271,466		74.9
Total deposits	$	21,378,754	1.95	%	$	20,574,323	0.82	%	$	804,431	3.9	%

The cost of deposits increased 113 bps, to 1.95%, for the first quarter of 2024 compared to 0.82% for the same period in 2023, primarily due to an increase in rates and a change in the mix of deposits. Average deposits increased $804.4 million during the first quarter of 2024 compared to the same period in 2023, primarily due to increases in average time deposits and average brokered deposits of $1.3 billion and $643.7 million, respectively, partially offset by a decrease in average noninterest-bearing demand deposits of $1.6 billion.

Average borrowings and interest rates, by type, are summarized in the following table:

	Three months ended March 31
	2024				2023				Increase (Decrease)
	Balance		Rate		Balance		Rate		$		%
Borrowings and other interest-bearing liabilities:	(dollars in thousands)
Federal funds purchased	$	173,659	5.44	%	$	505,142	4.85	%	$	(331,483)	(65.6)	%
Federal Home Loan Bank advances	902,890		4.80		1,261,589		4.97		(358,699)		(28.4)
Senior debt and subordinated debt	535,479		3.96		539,726		4.02		(4,247)		(0.8)
Other borrowings and other interest-bearing liabilities(1)	996,348		4.10		752,227		3.11		244,121		32.5
Total borrowings and other interest-bearing liabilities	$	2,608,376	4.46	%	$	3,058,684	4.32	%	$	(450,308)	(14.7)	%

(1) Includes repurchase agreements, short-term promissory notes, capital leases and collateral liabilities.

Average borrowings and other interest-bearing liabilities decreased $450.3 million in the first quarter of 2024 compared to the same period in 2023, primarily as a result of an increase in average total deposits. The decrease in average borrowings and other interest-bearing liabilities in the first quarter of 2024 compared to the first quarter of 2023 was primarily due to decreases in average FHLB advances and average Federal funds purchased of $358.7 million and $331.5 million, respectively, partially offset by an increase in average other borrowings and other interest-bearing liabilities of $244.1 million.

Provision for Credit Losses

The provision for credit losses was $10.9 million for the first quarter of 2024 compared to a provision of $24.5 million for the same period in 2023. The provision for credit losses of $10.9 million recorded in the first quarter of 2024 was primarily due to net charge-offs of $8.6 million and loan growth.

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Non-Interest Income

The following table presents the components of non-interest income:

	Three months ended March 31				Increase (Decrease)
	2024		2023		$		%
	(dollars in thousands)
Wealth management	$	20,155	$	18,062	$	2,093	11.6	%
Commercial banking:
Merchant and card	6,808		6,834		(26)		N/M
Cash management	6,305		5,515		790		14.3
Capital markets	2,341		2,344		(3)		N/M
Other commercial banking	3,375		2,820		555		19.7
Total commercial banking	18,829		17,513		1,316		7.5
Consumer banking:
Card	6,628		6,243		385		6.2
Overdraft	2,786		2,733		53		1.9
Other consumer banking	2,254		2,241		13		0.6
Total consumer banking	11,668		11,217		451		4.0
Mortgage banking	3,090		1,970		1,120		56.9
Other	3,398		2,968		430		14.5
Non-interest income before investment securities gains	57,140		51,730		5,410		10.5
Investment securities gains (losses), net	—		23		(23)		(100.0)
Total Non-Interest Income	$	57,140	$	51,753	$	5,387	10.4	%

Compared to the three months ended March 31, 2023, non-interest income before investment securities gains (losses) increased $5.4 million, or 10.5%, from $51.7 million. The increase in non-interest income was primarily due to increases of $2.1 million in wealth management revenues due to an increase in assets under management, $1.3 million in commercial banking income, $1.1 million in mortgage banking income and $0.5 million in consumer banking income. The increase in commercial banking income was primarily due to increases of $0.8 million in cash management fee income and $0.3 million in gains on sale from SBA loans, reflected in other commercial banking income. The increase in mortgage banking income was driven by higher loan sale volumes and higher spreads.

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Non-Interest Expense

The following table presents the components of non-interest expense:

	Three months ended March 31				Increase (Decrease)
	2024		2023		$		%
	(dollars in thousands)
Salaries and employee benefits	$	95,240	$	89,283	$	5,957	6.7	%
Data processing and software	17,661		15,796		1,865		11.8
Net occupancy	16,149		14,438		1,711		11.9
Other outside services	10,809		10,126		683		6.7
FDIC insurance	6,104		4,795		1,309		27.3
Equipment	4,040		3,389		651		19.2
Professional fees	2,088		2,392		(304)		(12.7)
Marketing	1,912		1,886		26		1.4
Intangible amortization	573		674		(101)		(15.0)
Other	16,695		16,837		(142)		(0.8)
Subtotal	171,271		159,616		11,655		7.3
FultonFirst implementation and asset disposals	6,329		—		6,329		N/M
Total non-interest expense	$	177,600	$	159,616	$	17,984	11.3	%

Non-interest expense increased $18.0 million, or 11.3%, for the three months ended March 31, 2024 compared to the same period in 2023. Excluding FultonFirst implementation costs and loss on asset disposals of $6.3 million, non-interest expense increased $11.7 million, or 7.3%, compared to the same period in 2023. The increase was primarily due to increases of $6.0 million in salaries and employee benefits expense, $1.9 million in data processing and software expense primarily due to technology investments made in 2023, $1.7 million in net occupancy expense driven by snow removal costs, $1.3 million in FDIC insurance expense, which includes a $1.0 million special assessment charge to recover the loss to the Deposit Insurance Fund in connection with certain bank closures in 2023, and $0.7 million in other outside services expense. The $6.0 million increase in salaries and benefits expense was primarily due to merit increases and healthcare costs.

FultonFirst initiative expenses of $6.3 million for the three months ended March 31, 2024 included $0.2 million in severance expense (reflected in salaries and employee benefits on the Consolidated Statement of Income), $2.5 million in consulting services expense (reflected in other outside services on the Consolidated Statement of Income) and loss on disposals of assets of $3.6 million (reflected in other non-interest expense on the Consolidated Statement of Income).

Income Taxes

Income tax expense for the three months ended March 31, 2024 was $13.6 million, a $1.3 million decrease from $14.9 million for the same period in 2023. The Corporation's ETR was 18.0% for the three months ended March 31, 2024 compared to 18.5% for the full year in 2023.

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FINANCIAL CONDITION

The table below presents condensed consolidated ending balance sheets:

	March 31, 2024		December 31, 2023		Increase (Decrease)
					$		%
Assets	(dollars in thousands)
Cash and cash equivalents	$	357,333	$	549,710	$	(192,377)	(35.0)	%
FRB and FHLB Stock	121,637		124,405		(2,768)		(2.2)
Loans held for sale	10,624		15,158		(4,534)		(29.9)
Investment securities	3,783,392		3,666,274		117,118		3.2
Net loans, less ACL - loans	21,146,595		21,057,690		88,905		0.4
Net premises and equipment	213,541		222,881		(9,340)		(4.2)
Goodwill and intangibles	560,114		560,687		(573)		(0.1)
Other assets	1,449,721		1,375,110		74,611		5.4
Total Assets	$	27,642,957	$	27,571,915	$	71,042	0.3	%
Liabilities and Shareholders' Equity
Deposits	$	21,741,950	$	21,537,623	$	204,327	0.9	%
Borrowings	2,296,040		2,487,526		(191,486)		(7.7)
Other liabilities	847,288		786,627		60,661		7.7
Total Liabilities	24,885,278		24,811,776		73,502		0.3
Total Shareholders' Equity	2,757,679		2,760,139		(2,460)		(0.1)
Total Liabilities and Shareholders' Equity	$	27,642,957	$	27,571,915	$	71,042	0.3	%

Investment Securities

The following table presents the carrying amount of investment securities:

	March 31, 2024		December 31, 2023		Increase (Decrease)
					$		%
Available for Sale	(dollars in thousands)
U.S. Government securities	$	—	$	42,161	$	(42,161)	N/M
U.S. Government-sponsored agency securities	998		1,010		(12)		(1.2)
State and municipal securities	1,052,259		1,072,013		(19,754)		(1.8)
Corporate debt securities	444,267		440,551		3,716		0.8
Collateralized mortgage obligations	187,428		111,434		75,994		68.2
Residential mortgage-backed securities	316,832		196,795		120,037		61.0
Commercial mortgage-backed securities	525,185		534,388		(9,203)		(1.7)
Total available for sale securities	$	2,526,969	$	2,398,352	$	128,617	5.4	%
Held to Maturity
Residential mortgage-backed securities	$	396,308	$	407,075	$	(10,767)	(2.6)	%
Commercial mortgage-backed securities	860,115		860,847		(732)		(0.1)
Total held to maturity securities	$	1,256,423	$	1,267,922	$	(11,499)	(0.9)	%
Total Investment Securities	$	3,783,392	$	3,666,274	$	117,118	3.2	%

Compared to December 31, 2023, total AFS securities at March 31, 2024 increased $128.6 million, or 5.4%, primarily due to increases in residential mortgage-backed securities and collateralized mortgage obligations of $120.0 million and $76.0 million,

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respectively, partially offset by decreases in U.S. Government securities and state and municipal securities of $42.2 million and $19.8 million, respectively. The increases in residential mortgage-backed securities and collateralized mortgage obligations were driven by purchases of these securities.

At March 31, 2024, total HTM securities decreased $11.5 million compared to December 31, 2023, primarily driven by a decrease of $10.8 million in residential mortgage-backed securities due to payments.

Loans

The following table presents ending net loans outstanding by type:

	March 31, 2024		December 31, 2023		Increase (Decrease)
					$		%
	(dollars in thousands)
Real estate - commercial mortgage	$	8,252,117	$	8,127,728	$	124,389	1.5%
Commercial and industrial(1)	4,467,589		4,545,552		(77,963)		(1.7)%
Real estate - residential mortgage	5,395,720		5,325,923		69,797		1.3%
Real estate - home equity	1,040,335		1,047,184		(6,849)		(0.7)%
Real estate - construction	1,249,199		1,239,075		10,124		0.8%
Consumer	698,421		729,318		(30,897)		(4.2)%
Leases and other loans(2)	341,102		336,314		4,788		1.4%
Net loans	$	21,444,483	$	21,351,094	$	93,389	0.4%

(1) Includes no unearned income for March 31, 2024 and $41.0 thousand for December 31, 2023.

(2) Includes unearned income of $38.0 million for March 31, 2024 and December 31, 2023.

During the three months ended March 31, 2024, net loans increased $93.4 million, or 0.4%, compared to December 31, 2023, primarily due to increases in commercial mortgage loans and residential mortgage loans of $124.4 million and $69.8 million, respectively, partially offset by decreases in commercial and industrial loans and consumer loans of $78.0 million and $30.9 million, respectively.

The Corporation does not have a significant concentration of credit risk with any single borrower. As of March 31, 2024, approximately $9.5 billion, or 44.3%, of the loan portfolio was comprised of commercial mortgage loans and construction loans. The Corporation has established lower total lending limits for certain types of lending commitments and lower total lending limits based on the Corporation's internal risk rating of an individual borrower at the time the lending commitment is approved.

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The following table summarizes the industry concentrations within the commercial mortgage and the commercial and industrial loan portfolios:

	March 31, 2024		December 31, 2023
Real estate(1)	48.7	%	46.6	%
Health care	7.0		6.6
Manufacturing	6.2		6.1
Agriculture	5.5		5.6
Other services	4.5		4.5
Construction(2)	4.4		4.1
Hospitality and food services	3.5		3.6
Retail	3.3		3.3
Wholesale trade	3.1		3.2
Educational services	2.9		2.9
Professional, scientific and technical services	2.4		2.2
Arts, entertainment and recreation	1.9		1.9
Transportation and warehousing	1.7		1.7
Finance and Insurance	1.3		1.3
Administrative and Support	1.1		1.1
Public administration	1.0		1.0
Other	1.5		4.3
Total	100.0	%	100.0	%

(1) Includes commercial loans to borrowers engaged in the business of: renting, leasing or managing real estate for others; selling and/or buying real estate for

others; and appraising real estate. Real estate commercial office represents 3% of total loans.

(2) Includes commercial loans to borrowers engaged in the construction industry.

The following table presents the changes in non-accrual loans for the three months ended March 31, 2024:

	Commercial  and Industrial		Real Estate - Commercial Mortgage		Real Estate - Construction		Real Estate - Residential Mortgage		Consumer and Real Estate - Home Equity		Leases and other loans		Total
	(dollars in thousands)
Balance at December 31, 2023	$	39,952	$	44,805	$	1,341	$	20,824	$	4,805	$	9,893	$	121,620
Additions	30,942		11,238		—		2,702		3,153		1,248		49,283
Payments	(12,064)		(9,876)		(55)		(394)		(272)		(245)		(22,906)
Charge-offs	(7,632)		(26)		—		(251)		(2,238)		(805)		(10,952)
Transfers to accrual status	(7,463)		(180)		—		(142)		(138)		—		(7,923)
Transfers to OREO	—		—		—		506		—		—		506
Balance at March 31, 2024	$	43,735	$	45,961	$	1,286	$	23,245	$	5,310	$	10,091	$	129,628

During the first quarter of 2024, non-accrual loans increased approximately $8.0 million, or 6.6%, largely due to additions to non-accrual loans, partially offset by payments and charge-offs. During the three months ended March 31, 2024, non-accrual loans as a percentage of total loans increased to 0.60%, compared to 0.57% as of December 31, 2023.

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The following table summarizes non-performing assets as of the periods shown below:

	March 31, 2024			December 31, 2023
	(dollars in thousands)
Non-accrual loans	$	129,628		$	121,620
Loans 90 days or more past due and still accruing	26,521			31,721
Total non-performing loans	156,149			153,341
OREO(1)	277			896
Total non-performing assets	$	156,426		$	154,237
Non-accrual loans to total loans	0.60		%	0.57		%
Non-performing loans to total loans	0.73		%	0.72		%
Non-performing assets to total assets	0.57		%	0.56		%
ACL - loans to non-performing loans	191		%	191		%

(1) Excludes $19.0 million and $10.9 million of residential mortgage properties for which formal foreclosure proceedings were in process as of March 31, 2024

and December 31, 2023, respectively.

Non-performing loans at March 31, 2024 increased $2.8 million, or 1.8%, compared to $153.3 million as of December 31, 2023. Non-performing loans as a percentage of total loans were 0.73% at March 31, 2024 and 0.72% at December 31, 2023. See "Note 4 - Loans and Allowance for Credit Losses," in the Notes to Consolidated Financial Statements for further details on non-performing loans.

The ability to identify potential problem loans in a timely manner is important to maintaining an adequate ACL. For commercial and industrial loans, commercial mortgages and commercial construction loans to commercial borrowers, an internal risk rating process is used to monitor credit quality. The evaluation of credit risk for residential mortgages, home equity loans, construction loans to individuals, consumer loans and leases and other loans is based on payment history, through the monitoring of delinquency levels and trends.

Total internally risk-rated loans were $13.7 billion as of March 31, 2024 and December 31, 2023, respectively, of which $1.0 billion and $0.9 billion were criticized and classified, respectively. For a description of the Corporation's risk ratings, see "Note 1 - Summary of Significant Accounting Policies - Allowance for Credit Losses" in the Notes to Consolidated Financial Statements in the Corporation's Annual Report on Form 10-K for the year ended December 31, 2023.

The following table presents criticized and classified loans, or those with internal risk ratings of special mention or substandard or lower for commercial mortgages, commercial and industrial loans and construction loans to commercial borrowers, by class segment:

	Special Mention(1)						Increase (Decrease)			Substandard or Lower(2)						Increase (Decrease)				Total Criticized and Classified Loans
	March 31, 2024			December 31, 2023			$		%	March 31, 2024			December 31, 2023			$		%		March 31, 2024			December 31, 2023
	(dollars in thousands)
Real estate - commercial mortgage	$	340,848		$	302,553		$	38,295	12.7%	$	248,325		$	224,774		$	23,551	10.5	%	$	589,173		$	527,327
Commercial and industrial	122,170			135,837			(13,667)		(10.1)	243,219			196,500			46,719		23.8		365,389			332,337
Real estate - construction (3)	22,273			38,520			(16,247)		(42.2)	24,404			26,771			(2,367)		(8.8)		46,677			65,291
Total	$	485,291		$	476,910		$	8,381	1.8%	$	515,948		$	448,045		$	67,903	15.2%		$	1,001,239		$	924,955
% of total risk rated loans	3.5		%	3.5		%				3.8		%	3.3		%					7.3		%	6.8		%

(1) Considered "criticized" loans by banking regulators.

(2) Considered "classified" loans by banking regulators.

(3) Excludes construction - other.

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The Corporation accounts for the credit risk associated with lending activities through the ACL and the provision for credit losses.

The following table presents the activity in the ACL:

	Three months ended March 31
	2024			2023
	(dollars in thousands)
Average balance of net loans	$	21,370,033		$	20,463,096
Balance of ACL at beginning of period	$	293,404		$	269,366
Loans charged off:
Real estate - commercial mortgage	(26)			(13,362)
Commercial and industrial	(7,632)			(612)
Real estate - residential mortgage	(251)			—
Consumer and real estate - home equity	(2,238)			(2,206)
Real estate - construction	—			—
Leases and other loans	(805)			(723)
Total loans charged off	(10,952)			(16,903)
Recoveries of loans previously charged off:
Real estate - commercial mortgage	152			786
Commercial and industrial	1,248			1,086
Real estate - residential mortgage	116			48
Consumer and real estate - home equity	676			661
Real estate - construction	—			202
Leases and other loans	162			116
Total recoveries	2,354			2,899
Net loans charged off (recoveries)	(8,598)			(14,004)
Provision for credit losses(1)	13,082			23,333
Balance of ACL at end of period	$	297,888		$	278,695
Provision for OBS credit exposures	$	(2,157)		$	1,211
Reserve for OBS credit exposures(2)	$	15,097		$	17,539
Net charge-offs to average loans (annualized)	0.16		%	0.27		%

(1) Provision included in the table only includes the portion related to net loans.

(2) Reserve for OBS credit exposures is recorded with other liabilities on the consolidated balance sheets.

The provision for credit losses, specific to loans, for the three months ended March 31, 2024 was $13.1 million, compared to a provision of $23.3 million recorded for the same period in 2023. The ACL includes qualitative adjustments, as appropriate, intended to capture the impact of uncertainties not reflected in the quantitative models. See "Note 4 - Loans and Allowance for Credit Losses," in the Notes to Consolidated Financial Statements for further details on the provision for credit losses.

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The following table summarizes the allocation of the ACL - loans:

	March 31, 2024						December 31, 2023
	ACL - loans		% to Total ACL - loans(1)		% to Total Net Loans(2)		ACL - loans		% to Total ACL - loans(1)		% to Total Net Loans(2)
	(dollars in thousands)
Real estate - commercial mortgage	$	114,492	38.4	%	38.5	%	$	112,565	38.4	%	38.1	%
Commercial and industrial	76,883		25.8		20.8		74,266		25.3		21.3
Real estate - residential mortgage	73,216		24.6		25.2		73,286		25.0		24.9
Consumer, home equity and leases and other loans	20,331		6.8		9.7		20,992		7.1		9.9
Real estate - construction	12,966		4.4		5.8		12,295		4.2		5.8
Total ACL - loans	$	297,888	100.0	%	100.0	%	$	293,404	100.0	%	100.0	%

(1) Ending ACL - loan portfolio segment balance as a % of total ACL - loans.

(2) Ending loan portfolio segment balances as a % of total net loans for the periods presented.

Deposits and Borrowings

The following table presents ending deposits by type:

	March 31, 2024		December 31, 2023		Increase (Decrease)
					$		%
	(dollars in thousands)
Noninterest-bearing demand	$	5,086,514	$	5,314,094	$	(227,580)	(4.3)	%
Interest-bearing demand	5,521,017		5,722,695		(201,678)		(3.5)
Savings and money market deposits	6,846,038		6,616,901		229,137		3.5
Total demand and savings	17,453,569		17,653,690		(200,121)		(1.1)
Brokered deposits	1,152,427		1,144,692		7,735		0.7
Time deposits	3,135,954		2,739,241		396,713		14.5
Total deposits	$	21,741,950	$	21,537,623	$	204,327	0.9	%

During the three months ended March 31, 2024, total deposits increased by $204.3 million, or 0.9%, compared to December 31, 2023. The increase in total deposits was primarily due to increases in time deposits and savings and money market deposits of $396.7 million and $229.1 million, respectively, partially offset by decreases in noninterest-bearing demand deposits and interest-bearing demand deposits of $227.6 million and $201.7 million, respectively.

Total uninsured deposits were estimated to be $7.1 billion and $7.2 billion at March 31, 2024 and December 31, 2023, respectively.

Time deposits of $250 thousand or more were $698.2 million and $551.2 million at March 31, 2024 and December 31, 2023, respectively.

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The following table presents ending borrowings by type:

	March 31, 2024		December 31, 2023		Increase (Decrease)
					$		%
	(dollars in thousands)
Federal funds purchased	$	—	$	240,000	$	(240,000)	N/M
Federal Home Loan Bank advances	900,000		1,100,000		(200,000)		(18.2)
Senior debt and subordinated debt	535,566		535,384		182		—
Other borrowings(1)	860,474		612,142		248,332		40.6
Total borrowings	$	2,296,040	$	2,487,526	$	(191,486)	(7.7)	%

(1) Includes repurchase agreements, short-term promissory notes and capital leases.

During the three months ended March 31, 2024, total borrowings decreased $191.5 million, or 7.7%, compared to December 31, 2023. The decrease in total borrowings was due to decreases in Federal funds purchased and FHLB advances of $240.0 million and $200.0 million, respectively, partially offset by an increase in other borrowings of $248.3 million.

Shareholders' Equity

On December 19, 2023, the Corporation announced that its Board of Directors approved the 2024 Repurchase Program. The 2024 Repurchase Program will expire on December 31, 2024. Under the 2024 Repurchase Program, the Corporation is authorized to repurchase up to $125.0 million of shares of its common stock through December 31, 2024. Under this authorization, up to $25.0 million of the $125 million authorization may be used to repurchase shares of the Corporation's preferred stock and outstanding subordinated notes.

During the three months ended March 31, 2024, 1,934,297 shares were repurchased under the 2024 Repurchase Program at a total cost of $30.3 million, or $15.69 per share.

Regulatory Capital

The Corporation and its wholly owned subsidiary bank, Fulton Bank, are subject to the Capital Rules administered by banking regulators. Failure to meet minimum capital requirements can trigger certain actions by regulators that could have a material effect on the Corporation's financial statements.

The Capital Rules require the Corporation and Fulton Bank to:

•Meet a minimum Common Equity Tier 1 capital ratio of 4.50% of risk-weighted assets;

•Meet a minimum Tier 1 Leverage capital ratio of 4.00% of average assets;

•Meet a minimum Total capital ratio of 8.00% of risk-weighted assets and a minimum Tier 1 capital ratio of 6.00% of risk-weighted assets;

•Maintain a "capital conservation buffer" of 2.50% above the minimum risk-based capital requirements, which must be maintained to avoid restrictions on capital distributions and certain discretionary bonus payments; and

•Comply with a revised definition of capital to improve the ability of regulatory capital instruments to absorb losses. Certain non-qualifying capital instruments, including cumulative preferred stock and TruPS, are excluded as a component of Tier 1 capital for institutions of the Corporation's size.

As of March 31, 2024, the Corporation's capital levels met the minimum capital requirements, including the capital conservation buffers, as prescribed in the Capital Rules.

As of March 31, 2024, Fulton Bank met the well-capitalized requirements under the regulatory framework for prompt corrective action. To be categorized as well-capitalized, a bank must maintain minimum Total risk-based, Tier I risk-based, Common Equity Tier I risk-based and Tier I leverage ratios as set forth in the Capital Rules. There were no other conditions or events since March 31, 2024 that management believes have changed the Corporation's capital categories.

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The following table summarizes the Corporation's capital ratios in comparison to regulatory requirements:

	March 31, 2024		December 31, 2023		Regulatory Minimum for Capital Adequacy		Fully Phased-in, with Capital Conservation Buffers
Total Risk-Based Capital (to Risk-Weighted Assets)	14.0	%	14.0	%	8.0	%	10.5	%
Tier I Risk-Based Capital (to Risk-Weighted Assets)	11.1	%	11.2	%	6.0	%	8.5	%
Common Equity Tier I (to Risk-Weighted Assets)	10.3	%	10.3	%	4.5	%	7.0	%
Tier I Leverage Capital (to Average Assets)	9.3	%	9.5	%	4.0	%	4.0	%

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Market risk is the exposure to economic loss that arises from changes in the values of certain financial instruments. The types of market risk exposures generally faced by financial institutions include interest rate risk, equity market price risk, debt security market price risk, foreign currency price risk and commodity price risk. Due to the nature of its operations, foreign currency price risk and commodity price risk are not significant to the Corporation.

Interest Rate Risk, Asset/Liability Management and Liquidity

Interest rate risk creates exposure in two primary areas. First, changes in rates have an impact on the Corporation's liquidity position and could affect its ability to meet obligations and continue to grow. Second, movements in interest rates can create fluctuations in the Corporation's net interest income and changes in the economic value of its equity.

The Corporation employs various management techniques to minimize its exposure to interest rate risk. The Corporation's ALCO is responsible for reviewing the interest rate sensitivity and liquidity positions of the Corporation, approving asset and liability management policies, and overseeing the formulation and implementation of strategies regarding balance sheet positions.

The Corporation uses two complementary methods to measure and manage interest rate risk. They are a simulation of net interest income and estimates of economic value of equity. Using these measurements in tandem provides a reasonably comprehensive summary of the magnitude of the Corporation's interest rate risk, level of risk as time evolves, and exposure to changes in interest rates.

Simulation of net interest income is performed for the next 12-month period. A variety of interest rate scenarios are used to measure the effects of sudden and gradual movements upward and downward in the yield curve. These results are compared to the results obtained in a flat or unchanged interest rate scenario. Simulation of net interest income is used primarily to measure the Corporation's short-term earnings exposure to rate movements. The Corporation's policy limits the potential exposure of net interest income, in a non-parallel instantaneous shock, to 10% of the base case net interest income for a 100 bps shock in interest rates, 15% for a 200 bps shock, 20% for a 300 bps shock and 25% for a 400 bps shock. A "shock" is an immediate upward or downward movement of interest rates. The shocks do not take into account changes in customer behavior that could result in changes to mix and/or volumes in the balance sheet, nor does it take into account the potential effects of competition on the pricing of deposits and loans over the forward 12-month period.

Contractual maturities and repricing opportunities of loans are incorporated in the simulation model as are prepayment assumptions, maturity data and call options within the investment portfolio. Assumptions based on past experience are incorporated into the model for non-maturity deposit accounts. The assumptions used are inherently uncertain and, as a result, the model cannot precisely measure future net interest income or precisely predict the impact of fluctuations in market interest rates on net interest income. Actual results will differ from the model's simulated results due to timing, amount and frequency of interest rate changes as well as changes in market conditions and the application and timing of various management strategies.

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The following table summarizes the expected impact of abrupt interest rate changes, that is, a non-parallel instantaneous shock, on net interest income as of March 31, 2024:

Rate Shock(1)	Annual change in net interest income	% change in net interest income
+400 bp	+ $52.6 million	+5.8%
+300 bp	+ $40.6 million	+4.5%
+200 bp	+ $28.8 million	+3.2%
+100 bp	+ $17.7 million	+2.0%
–100 bp	- $39.4 million	-4.4%
–200 bp	- $79.5 million	-8.8%
–300 bp	- $111.1 million	-12.3%
–400 bp	- $131.9 million	-14.6%

(1) These results include the effect of implicit and explicit interest rate floors that limit further reduction in interest rates.

Economic value of equity estimates the discounted present value of asset and liability cash flows. Discount rates are based upon market prices for like assets and liabilities. Abrupt changes or "shocks" in interest rates, both upward and downward, are used to determine the comparative effect of such interest rate movements relative to the unchanged environment. This measurement tool is used primarily to evaluate the longer-term repricing risks and options in the Corporation's balance sheet. The Corporation's policy limits the economic value of equity that may be at risk, in a non-parallel instantaneous shock, to 10% of the base case economic value of equity for a 100 bps shock in interest rates, 20% for a 200 bps shock, 30% for a 300 bps shock and 40% for a 400 bps shock. As of March 31, 2024, the Corporation was within economic value of equity policy limits for every 100 bps shock.

Interest Rate Derivatives

The Corporation enters into interest rate derivatives with certain qualifying commercial loan customers to meet their interest rate risk management needs. The Corporation simultaneously enters into interest rate derivatives with dealer counterparties, with identical notional amounts and terms. The net result of these interest rate derivatives is that the customer pays a fixed rate of interest and the Corporation receives a floating rate. These interest rate derivatives are derivative financial instruments, and the gross fair values are recorded in other assets and liabilities on the consolidated balance sheets, with changes in fair value during the period recorded in other non-interest expense on the consolidated statements of income.

Cash Flow Hedges

The Corporation's objectives in using interest rate derivatives are to reduce volatility in interest income and interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Corporation primarily uses interest rate derivatives as part of its interest rate risk management strategy. The Corporation enters into interest rate derivatives designated as cash flow hedges to hedge the variable cash flows associated with existing floating rate loans and borrowings.

For derivatives designated and that qualify as cash flow hedges of interest rate risk, the unrealized gain or loss on the derivative is recorded in AOCI and subsequently reclassified into interest income or interest expense in the same period during which the hedged transaction affects earnings. Amounts reported in AOCI related to derivatives will be reclassified to interest income as interest payments are made on the Corporation's variable-rate liabilities.

In January 2023, the Corporation terminated interest rate derivatives designated as cash flow hedges with a combined notional amount of $1.0 billion. As the hedged transaction continues to be probable, the unrealized losses that have been recorded in AOCI will be recognized as a reduction to interest income when the previously forecasted hedged item affects earnings in future periods. During the three months ended March 31, 2024, $7.0 million of these unrealized losses have been reclassified as a reduction of interest income on loans, including fees, on the consolidated statements of income.

Liquidity

The Corporation must maintain a sufficient level of liquid assets to meet the cash needs of its customers, who, as depositors, may want to withdraw funds or who, as borrowers, need credit availability. Liquidity is provided on a continuous basis through scheduled and unscheduled principal and interest payments on investments and outstanding loans and through the availability of

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deposits and borrowings. The Corporation also maintains secondary sources that provide liquidity on a secured and unsecured basis to meet short- and long-term needs.

The Corporation maintains liquidity sources in the form of interest-bearing deposits and customer funding (short-term promissory notes). The Corporation can access additional liquidity from these sources, if necessary, by increasing the rates of interest paid on those instruments. The positive impact to liquidity resulting from paying higher interest rates could have a detrimental impact on NIM and net interest income if rates on interest-earning assets do not experience a proportionate increase. Borrowing availability with the FHLB and the FRB, along with federal funds lines at various correspondent banks, provides the Corporation with additional liquidity.

Fulton Bank is a member of the FHLB and has access to FHLB overnight and term credit facilities. As of March 31, 2024, the Bank had total borrowing capacity of approximately $9.4 billion with $3.3 billion of advances and letters of credit outstanding, for a remaining available borrowing capacity of approximately $6.1 billion under these facilities. Advances from the FHLB are secured by qualifying commercial real estate and residential mortgage loans, investments and other assets.

As of March 31, 2024, the Corporation had aggregate federal funds lines borrowing capacity of $2.6 billion with $0 outstanding against that amount. As of March 31, 2024, the Corporation had $1.2 billion of collateralized borrowing capacity at the FRB discount window.

A combination of commercial real estate loans, commercial loans, consumer loans and securities are pledged to the FRB of Philadelphia to provide access to FRB discount window borrowings. Securities carried at $0.6 billion at March 31, 2024 and $0.4 billion at December 31, 2023 were pledged as collateral to secure public and trust deposits.

Liquidity must also be managed at the Corporation's parent company level. For safety and soundness reasons, banking regulations limit the amount of cash that can be transferred from subsidiary banks to the parent company in the form of loans and dividends. Generally, these limitations are based on the subsidiary banks’ regulatory capital levels and their net income. Management continues to monitor the liquidity and capital needs of the parent company including monitoring the granularity of the deposit portfolio and level of uninsured deposits. Management will implement appropriate strategies, as necessary, to remain adequately capitalized and to meet its cash needs.

The consolidated statements of cash flows provide additional information. The Corporation's operating activities during the three months ended March 31, 2024 provided $152.9 million of cash. Cash used by investing activities was $299.9 million and was mainly due to the purchase of AFS securities and a net increase in loans. Cash used by financing activities was $45.4 million, and was primarily due to acquisition of treasury stock and dividends paid, partially offset by a net $12.7 million increase in deposits and other borrowings.

Debt Security Market Price Risk

Debt security market price risk is the risk that changes in the values of debt securities, unrelated to interest rate changes, could have a material impact on the financial position or results of operations of the Corporation. The Corporation's debt security investments consist primarily of U.S. government-sponsored agency issued mortgage-backed securities and collateralized mortgage obligations, state and municipal securities, and corporate debt securities. All of the Corporation's investments in mortgage-backed securities and collateralized mortgage obligations have principal payments that are guaranteed by U.S. government-sponsored agencies.

State and Municipal Securities

As of March 31, 2024, the Corporation owned securities issued by various states and municipalities with a total fair value of $1.1 billion. Uncertainty with respect to the financial strength of state and municipal bond insurers places emphasis on the underlying strength of issuers. Pressure on local tax revenues of issuers due to adverse economic conditions could have an adverse impact on the underlying credit quality of issuers. The Corporation evaluates existing and potential holdings primarily based on the underlying creditworthiness of the issuing state or municipality and then, to a lesser extent, on any credit enhancement. State and municipal securities can be supported by the general obligation of the issuing state or municipality, allowing the securities to be repaid by any means available to the issuing state or municipality. As of March 31, 2024, approximately 100% of state and municipal securities were supported by the general obligation of corresponding states or municipalities. Approximately 74% of these securities were school district issuances, which are also supported by the states of the issuing municipalities.

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Item 4. Controls and Procedures

The Corporation carried out an evaluation, under the supervision and with the participation of the Corporation's management, including the Corporation's Chief Executive Officer and Interim Chief Financial Officer, of the effectiveness of the design and operation of the Corporation's disclosure controls and procedures pursuant to Rule 13a-15, promulgated under the Exchange Act. Based upon that evaluation, the Corporation's Chief Executive Officer and Interim Chief Financial Officer concluded that, as of March 31, 2024, the Corporation's disclosure controls and procedures are effective. Disclosure controls and procedures are controls and procedures that are designed to ensure that information required to be disclosed in Corporation reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

The information presented in the "Legal Proceedings" section of Note 12 "Commitments and Contingencies" of the Notes to Consolidated Financial Statements is incorporated herein by reference.

Item 1A. Risk Factors

Item 1A. Risk Factors of the Corporation's Annual Report on Form 10-K for the year ended December 31, 2023 includes a discussion of the material risks and uncertainties that could adversely affect the Corporation's business, results of operations and financial condition.

The information presented below provides an update to, and should be read in conjunction with, the risk factors and other information contained in the Corporation's Annual Report on Form 10-K for the year ended December 31, 2023.

We may fail to realize the anticipated benefits of the Republic First Transaction.

The success of the Republic First Transaction will depend on, among other things, our ability to integrate the Republic First Assets and Liabilities into our business in a manner that facilitates growth opportunities and achieves the anticipated benefits of the Republic First Transaction. Although the Republic First Transaction was an FDIC-assisted transaction, we are still subject to some of the same risks we would face in acquiring another bank in a negotiated transaction. In addition, because of the expedited nature of the FDIC-assisted transaction, which did not allow bidders the time and access to information customarily associated with preparing for and evaluating a negotiated transaction, we may face additional risks. Such risks include risks associated with maintaining customer relationships and failure to realize the anticipated acquisition benefits in the amounts and within the time frames we expect. Further, we did not enter into a loss sharing arrangement with the FDIC in connection with the Republic First Transaction. If we are not able to successfully achieve our objectives and manage the corresponding risks, the anticipated benefits of the Republic First Transaction may not be realized fully or at all or may take longer to realize than expected.

There is a significant degree of difficulty and management distraction inherent in the process of integrating an acquisition, including challenges consolidating certain operations and functions (including regulatory functions), integrating technologies, organizations, procedures, policies and operations, addressing differences in the business cultures of the Corporation and retaining key personnel. In addition, the success of the Republic First Transaction will depend on a number of factors, including, but not limited to our ability to limit the outflow of deposits held by our new customers and to successfully retain and manage interest-earning assets (i.e., loans) acquired in the Republic First Transaction, our ability to attract new deposits and to generate new interest-earning assets in the areas previously served by the former Republic First Bank branches, our ability to control the incremental non-interest expense from the former Republic First Bank branches and other units in a manner that enables us to maintain a favorable overall efficiency ratio, the accuracy of our assumptions regarding the value of the Republic First Assets and Liabilities, our ability to effectively manage the ongoing relationship with the FDIC related to the Republic First Transaction, our ability to collect on the loans acquired, our assumptions regarding the risk profile of the loans acquired, and our ability to earn acceptable levels of interest and non-interest income. The integration may be complex and time consuming and involve delays or additional and unforeseen expenses. The integration process and other disruptions resulting from the Republic First Transaction may also disrupt our ongoing business, which may cause the Corporation to lose clients and customers, or cause clients and customers to move their business to competing financial institutions. It is possible that the integration process could result in inconsistencies in standards, controls, procedures and policies that could adversely affect the Corporation's ability to maintain relationships with clients, customers, depositors and employees. In addition, the loss of key employees in connection with the Republic First Transaction could adversely affect the Corporation's ability to successfully conduct its business. Any failure to successfully or cost-effectively integrate the Republic First Assets and Liabilities in connection with the Republic First Transaction could have a material adverse effect on our business, operations and financial

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position, including as a result of reputational harm or other legal or regulatory costs associated with the Republic First Transaction.

We may incur unforeseen liabilities or losses in connection with the Republic First Transaction.

In connection with the Republic First Transaction, we have agreed to assume certain liabilities of Republic First Bank. The expedited nature of the Republic First Transaction did not allow bidders the time and access to information customarily associated with preparing for and evaluating a negotiated transaction. As such, there may be liabilities that we failed or were unable to discover in the course of performing due diligence investigations into the Republic First Assets and Liabilities, or we may not have correctly assessed the significance of certain liabilities identified in the course of our due diligence. Any such liabilities, individually or in the aggregate, could lead to unforeseen losses, which may be significant, and which could have a material adverse effect on our business, financial condition and results of operations.

Our assumptions regarding the fair value of Republic First Assets and Liabilities could be inaccurate which could materially and adversely affect our business, financial condition, results of operations, and future prospects.

Our acquisition of certain assets of Republic First Bank in connection with the Republic First Transaction followed the FDIC's competitive bidding process. The expedited nature of the transaction did not allow bidders the time and access to information customarily associated with preparing for and evaluating a negotiated transaction. The determination of both the aggregate amount and the fair value of the Republic First Assets and Liabilities is based on estimates about discount rates, future expected cash flows, market conditions and other future events that are highly subjective in nature and subject to change. Our estimates of the fair value of the Republic First Assets and Liabilities are based on information provided to us by the FDIC, much of which has not been independently verified given the nature of the FDIC's expedited competitive bidding process. Further, we have not entered into a loss sharing arrangement with the FDIC in connection with the Republic First Transaction. As a result, fair value assumptions we have made in connection with Republic First Assets and Liabilities in the Republic First Transaction may be inaccurate and subject to change as the acquired assets and customers are integrated into Fulton Bank and we acquire additional information and details about the Republic First Assets and Liabilities. If our assumptions and projections regarding the fair value of the Republic First Assets and Liabilities are wrong, it could adversely impact our business, financial condition and results of operations.

We are in the process of validating the fair value of the Republic First Assets and Liabilities based on ongoing internal assessments and continuing discussions with the FDIC regarding the fair value of the assets acquired in the Republic First Transaction, which may impact our assumptions and estimates regarding the fair value of the Republic First Assets and Liabilities. In addition, we may obtain additional information and evidence that could result in changes to our assumptions regarding the fair value of the Republic First Assets and Liabilities in connection with the Republic First Transaction, including potential decreases in the fair value of the Republic First Assets and Liabilities.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(a)  None.

(b)  None.

(c)                             Period	Total Number of Shares Purchased	Average Price Paid per Share(1)		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
January 1, 2024 to January 31, 2024	514,004	$	16.08	514,004	$	116,733,523
February 1, 2024 to February 29, 2024	1,420,293	15.55		1,420,293	94,651,692
March 1, 2024 to March 31, 2024	—	—		—	94,651,692

(1) Includes 1% excise tax

On December 19, 2023, the Corporation announced that its Board of Directors approved the 2024 Repurchase Program. The 2024 Repurchase Program will expire on December 31, 2024. Under the 2024 Repurchase Program, the Corporation is authorized to repurchase up to $125.0 million of shares of its common stock through December 31, 2024. Under this authorization, up to $25.0 million of the $125 million authorization may be used to repurchase shares of the Corporation's preferred stock and outstanding subordinated notes.

As permitted by securities laws and other legal requirements and subject to market conditions and other factors, purchases may be made from time to time under the 2024 Repurchase Program in open market or privately negotiated transactions, including

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without limitation, through accelerated share repurchase transactions. The 2024 Repurchase Program may be discontinued at any time.

During the three months ended March 31, 2024, 1,934,297 shares were repurchased under the 2024 Repurchase Program at a total cost of $30.3 million, or $15.69 per share.

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Item 5. Other Information

(c) None of the Corporation's directors or "officers" (as defined in Rule 16a-1(f) (17 C.F.R. § 240.16a-1(f))) adopted or terminated a "Rule 10b5-1 trading arrangement" or a "non-Rule 10b5-1 trading arrangement" (as those terms are defined in Item 408 of Regulation S-K (17 C.F.R. § 229.408)) during the fiscal quarter ended March 31, 2024.

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Item 6. Exhibits

1.1	Underwriting Agreement, dated as of April 29, 2024, by and among Fulton Financial Corporation and Piper Sandler & Co. and BofA Securities, Inc., as representatives of the several underwriters listed in Schedule I thereto (Incorporated by reference to Exhibit 1.1 of the Fulton Financial Corporation Current Report on Form 8-K filed on May 1, 2024).
2.1	Purchase and Assumption Agreement – Whole Bank, All Deposits, effective as of April 26, 2024, with the Federal Deposit Insurance Corporation, as receiver of Republic First Bank, the Federal Deposit Insurance Corporation, and Fulton Bank, National Association (Incorporated by reference to Exhibit 2.1 of the Fulton Financial Corporation Current Report on Form 8-K filed on May 2, 2024).
3.1	Articles of Incorporation, as amended and restated, of Fulton Financial Corporation as amended (Incorporated by reference to Exhibit 3.1 of the Fulton Financial Corporation Current Report Form 8-K filed June 24, 2011).
3.2	Statement with Respect to Shares of Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A of Fulton Financial Corporation, dated October 23, 2020, filed with the Pennsylvania Department of State (Incorporated by reference to Exhibit 3.1 of the Fulton Financial Corporation Current Report on Form 8-K filed on October 29, 2020).
3.3	Bylaws of Fulton Financial Corporation as amended (Incorporated by reference to Exhibit 3.1 of the Fulton Financial Corporation Current Report on a Form 8-K filed May 14, 2021).
4.1	Statement with Respect to Shares of Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A of Fulton Financial Corporation, dated October 23, 2020, filed with the Pennsylvania Department of State (Incorporated by reference to Exhibit 3.1 of the Fulton Financial Corporation Current Report on Form 8-K filed on October 29, 2020).
4.2	Deposit Agreement, dated October 29, 2020, among Fulton Financial Corporation, Equiniti Trust Company, as depositary, and the holders from time to time of the depositary receipts described therein (Incorporated by reference to Exhibit 4.1 of the Fulton Financial Corporation Current Report on Form 8-K filed on October 29, 2020).
4.3	Form of depositary receipt representing the Depositary Shares (Included in Exhibit 4.2).
4.4	Stock Certificate (Incorporated by reference as Exhibit 4.1 of Fulton Financial Corporation Registration Statement on Form S-4 filed on April 21, 2022).
10.1	Separation Agreement and General Release - filed herewith.
10.2	Form of Time-Vested Restricted Stock Unit Award Agreement - filed herewith.
10.3	Form of Performance Restricted Stock Unit Award Agreement Total Shareholder Return ("TSR") Component - filed herewith.
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	Interactive data files pursuant to Rule 405 of Regulation S-T: (i) Unaudited Consolidated Balance Sheets, (ii) Unaudited Consolidated Statements of Income, (iii) Unaudited Consolidated Statements of Comprehensive Income, (iv) Unaudited Consolidated Statements of Shareholders' Equity, (v) Consolidated Statements of Cash Flows, and (vi) Notes to Consolidated Financial Statements.
104	Cover page interactive data file (formatted as inline XBRL and contained in Exhibit 101)

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FULTON FINANCIAL CORPORATION AND SUBSIDIARIES

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

FULTON FINANCIAL CORPORATION
Date:	May 9, 2024	/s/ Curtis J. Myers
		Curtis J. Myers
		Chairman and Chief Executive Officer
Date:	May 9, 2024	/s/ Beth Ann L. Chivinski
		Beth Ann L. Chivinski
		Senior Executive Vice President and Interim Chief Financial Officer

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