
	For the Year Ended December 31, 2025
(In thousands)	Beginning Balance		Allowance on PCD Loans Acquired During the Period		Provision for Credit Losses		Charge- Offs		Recoveries		Ending Balance
Construction and land development	$	7,252	$	46	$	2,583	$	(156)	$	15	$	9,740
CRE - owner occupied	11,825		190		5,137		(728)		104		16,528
CRE - non-owner occupied	43,866		1,477		8,727		(420)		2,493		56,143
Residential real estate	39,168		743		11,583		(410)		213		51,297
Commercial and financial	27,533		639		22,639		(15,521)		2,653		37,943
Consumer	8,411		37		591		(2,787)		900		7,152
Total	$	138,055	$	3,132	$	51,260	$	(20,022)	$	6,378	$	178,803


	For the Year Ended December 31, 2024
(In thousands)	Beginning Balance		Provision for Credit Losses		Charge- Offs		Recoveries		Ending Balance
Construction and land development	$	8,637	$	(1,404)	$	(1)	$	20	$	7,252
CRE - owner occupied	5,529		6,629		(341)		8		11,825
CRE - non-owner occupied	48,288		(3,096)		(1,485)		159		43,866
Residential real estate	39,016		(150)		(134)		436		39,168
Commercial and financial	34,343		7,789		(17,616)		3,017		27,533
Consumer	13,118		6,490		(12,288)		1,091		8,411
Total	$	148,931	$	16,258	$	(31,865)	$	4,731	$	138,055


	For the Year Ended December 31, 2023
(In thousands)	Beginning Balance		Allowance on PCD Loans Acquired During the Period		Provision for Credit Losses		Charge- Offs		Recoveries		Ending Balance
Construction and land development	$	6,464	$	5	$	2,160	$	—	$	8	$	8,637
CRE - owner occupied	6,051		139		(663)		—		2		5,529
CRE - non-owner occupied	43,258		647		4,315		(120)		188		48,288
Residential real estate	29,605		400		8,858		(356)		509		39,016
Commercial and financial	15,648		17,527		17,644		(18,565)		2,089		34,343
Consumer	12,869		161		5,204		(5,754)		638		13,118
Total	$	113,895	$	18,879	$	37,518	$	(24,795)	$	3,434	$	148,931

Management establishes the allowance using relevant available information from both internal and external sources, relating to past events, current economic conditions, and reasonable and supportable forecasts. Forecast data is sourced from Moody’s, a firm widely recognized for its research, analysis, and economic forecasts. The forecasts of future economic conditions are over the expected remaining life of the loan using economic forecasts that revert to long-term historical averages over time.

As of December 31, 2025 and December 31, 2024, the Company utilized a multiple scenario model comprised of a blend of Moody’s economic scenarios and considered the uncertainty associated with the assumptions in the scenarios, including continued actions taken by the Federal Reserve regarding monetary policy and changes in interest rates and the potential impact of those actions. Outcomes could differ from the scenarios utilized, and the Company incorporated qualitative considerations

reflecting the risk of uncertain economic conditions, and for additional dimensions of risk that may not be captured in the quantitative model.

The allowance increased $40.7 million, or 29.5%, during 2025 to $178.8 million, or 1.42%, of loans held for investment as of December 31, 2025. The acquisition of VBI on October 1, 2025, added approximately $1.2 billion in loans and provision expense of $22.7 million for the non-PCD loans acquired from VBI, contributing to the increase in allowance in each segment.

In the Construction and land development segment, the increase in the allowance is primarily due to an increase in outstanding loan balances. In this segment, the primary source of repayment typically stems from proceeds of the sale or permanent financing of the underlying property. Therefore, industry, collateral type and estimated collateral values are among the relevant factors in assessing expected losses.

In the CRE - owner-occupied segment, the allowance increased due to an increase in loan balances and additional credit and integration risk associated with acquired loan balances. Risk characteristics include, but are not limited to, collateral type, note structure, and loan seasoning.

In the CRE - Non-owner occupied segment, the allowance increase is driven by an increase in loan balances and additional credit and integration risk associated with acquired loan balances. Repayment is often dependent upon rental income from the successful operation of the underlying property or from the sale of the property. Loan performance may be adversely affected by general economic conditions or conditions specific to the real estate market, including property types. Collateral type, note structure, and loan seasoning are among the risk characteristics analyzed for this segment.

The Residential real estate segment includes residential mortgage, home equity loans and HELOCs. The increase in the allowance is primarily due to an increase in loans due to the VBI acquisition. Risk characteristics considered for this segment include, but are not limited to, borrower FICO score, lien position, LTV ratios, and loan seasoning.

In the Commercial and financial segment, borrowers are primarily small to medium-sized professional firms and other businesses, and loans are generally supported by projected cash flows of the business, collateralized by business assets, and/or guaranteed by the business owners. The increase in the allowance is due to an increase in loan balances. Industry, collateral type, estimated collateral values, and loan seasoning are among the relevant factors in assessing expected losses.