COLUMBIA BANKING SYSTEM, INC.

Previous wording

•uncertainty in U.S. fiscal and monetary policy, including the interest rate policies of the Federal Reserve or the effects of any declines in housing and CRE prices, high or increasing unemployment rates, renewed inflation, or any recession or slowdown in economic growth particularly in the western United States;

Current wording

•uncertainty in U.S. fiscal and monetary policy, including the interest rate policies of the Federal Reserve or the effects of any declines in housing and CRE prices, high or increasing unemployment rates, renewed or sustained inflation, or any recession or slowdown in economic growth particularly in the western United States;

Previous wording

•risks related to the acquisition of Pacific Premier including, among others, cost savings and any revenue or expense synergies from the acquisition may not be fully realized or may take longer than anticipated to be realized;

Current wording

•risks related to the acquisition of Pacific Premier including, among others, any revenue synergies from the acquisition may not be fully realized or may take longer than anticipated to be realized, and the risk that deposit attrition may result from the transaction;

Previous wording

•our ability to achieve the efficiencies and enhanced financial and operating performance we expect to realize from investments in personnel, acquisitions, and infrastructure;

Current wording

•our ability to achieve the efficiencies and enhanced financial and operating performance we expect to realize from investments in personnel, acquisitions, infrastructure, and technology;

Previous wording

•the possibility that the anticipated benefits from ongoing initiatives to improve operational performance are not realized in the amounts or when expected if at all;

Current wording

•the possibility that the anticipated benefits from ongoing initiatives to improve operational performance and efficiency are not realized in the amounts or when expected if at all;

Previous wording

•Net interest margin, on a tax-equivalent basis, was 3.96% for the three months ended March 31, 2026, as compared to 4.06% for the three months ended December 31, 2025. The decline primarily reflects the absence of the $12 million of time-deposit premium amortization associated with the Pacific Premier acquisition that benefited the prior quarter. Lower yields on loans and cash following reductions to the federal funds rate during the fourth quarter of 2025 were offset by lower deposit costs related to the rate reductions and continued improvement in the Company's funding mix, including a lower proportion of higher-cost brokered deposits. The average cost of interest-bearing deposits declined by 4 basis points to 2.04%, reflecting proactive deposit pricing actions and a favorable change in deposit mix. Overall, the cost of interest-bearing liabilities declined to 2.24%, a 3-basis-point decrease from the prior quarter.

Current wording

•Net interest margin, on a tax-equivalent basis, was 3.93% for the three months ended June 30, 2026, as compared to 3.96% for the three months ended March 31, 2026. The 3 basis point decrease was driven primarily by interest income reversals recorded during the three months ended June 30, 2026. Otherwise, net interest income was relatively consistent between periods as a lower yield on taxable securities was offset by lower deposit costs and continued improvement in the Company's funding mix, including a lower proportion of higher-cost brokered deposits. The average cost of interest-bearing deposits declined by 8 basis points to 1.96%, while the cost of interest-bearing liabilities declined 3 basis points to 2.21%. The decline in the yield on taxable securities between periods was driven by changes in prepayment speed expectations.

Previous wording

•Non-interest income was $83 million for the three months ended March 31, 2026, as compared to $90 million for the three months ended December 31, 2025. Quarterly changes in fair value adjustments and MSR hedging activity, driven by interest-rate movements, resulted in a net fair-value gain of $2 million during the quarter, unchanged from the prior quarter. The remaining change in non-interest income primarily reflects lower swap, syndication, and international banking revenue following stronger levels of customer activity in the prior quarter.

Current wording

•Non-interest income was $88 million for the three months ended June 30, 2026, as compared to $83 million for the three months ended March 31, 2026. Interest rate movements resulted in a net fair value loss of $3 million related to fair value adjustments and mortgage servicing rights hedging activity during the second quarter of 2026, as compared to a net fair value gain of $2 million during the first quarter of 2026. Excluding these impacts, the increase in non-interest income primarily reflects higher customer fee income, including service charges on deposits, card-based fees, and other income. Other income also benefited from $3 million of BOLI death benefit proceeds from a single policy, while trading, international banking, syndication, and swap-related revenue increased from the seasonally lower levels typically experienced during the first quarter.

Previous wording

•Non-interest expense was $394 million for the three months ended March 31, 2026, representing a decrease of $18 million as compared to the three months ended December 31, 2025. The decrease was primarily due to a $15 million reduction in merger and restructuring expenses, as well as the realization of acquisition-related cost savings with the Pacific Premier acquisition.

Current wording

•Non-interest expense was $375 million for the three months ended June 30, 2026, a decrease of $19 million as compared to the three months ended March 31, 2026. The decrease was primarily due to a $15 million reduction in merger and restructuring expense following the systems conversion completed during the first quarter, as well as the continued realization of cost savings associated with the Pacific Premier acquisition.

Previous wording

•Earnings per diluted common share was $0.66 for the three months ended March 31, 2026, as compared to $0.41 for the three months ended March 31, 2025. The increase primarily reflects higher net income driven by the acquisition of Pacific Premier and continued improvements in our balance sheet's mix of assets and liabilities, partially offset by an increase in weighted-average diluted common shares outstanding following the issuance of shares in connection with the Pacific Premier acquisition.

Current wording

•Earnings per diluted common share was $1.38 for the six months ended June 30, 2026, as compared to $1.14 for the six months ended June 30, 2025. The increase primarily reflects the acquisition of Pacific Premier and continued balance sheet optimization, including the replacement of lower-yielding transactional loans with relationship-based commercial loans and a reduced reliance on higher-cost wholesale funding sources, as well as growth in recurring fee income streams. These benefits were partially offset by an increase in weighted-average diluted common shares outstanding following the issuance of shares in connection with the acquisition.

Previous wording

•Net interest margin, on a tax-equivalent basis, was 3.96% for the three months ended March 31, 2026, as compared to 3.60% for the three months ended March 31, 2025. The increase was primarily driven by lower funding costs and benefits of balance sheet optimization, including a shift toward lower-cost customer deposits and reduced reliance on high-cost wholesale funding sources. These improvements were partially offset by lower earning-asset yields, given reductions to the federal funds rate during 2025.

Current wording

•Net interest margin, on a tax-equivalent basis, was 3.94% for the six months ended June 30, 2026, as compared to 3.67% for the six months ended June 30, 2025. The increase was primarily attributable to lower funding costs and a favorable balance sheet mix shift toward lower-cost customer deposits and away from higher-cost wholesale funding sources, including borrowings and brokered deposits. These benefits were partially offset by lower earning-asset yields resulting from the lower rate environment.

Previous wording

•Non-interest income was $83 million for the three months ended March 31, 2026, as compared to $66 million for the three months ended March 31, 2025. The increase was primarily driven by higher financial services and trust revenue reflecting the combined operations following the acquisition of Pacific Premier, as well as growth in customer-related fee income. Changes in fair value adjustments and hedges resulted in a net fair value gain of $2 million related mainly to loans held for investment at fair value and MSR fair value and hedge changes for the three months ended March 31, 2026, compared to a net gain of $10 million for the prior-year period.

Current wording

•Non-interest income was $171 million for the six months ended June 30, 2026, as compared to $131 million for the six months ended June 30, 2025. The increase was primarily driven by higher financial services and trust revenue reflecting the combined operations following the acquisition of Pacific Premier, including the addition of Pacific Premier's custodial trust business, as well as growth in customer-related fee income. These increases were partially offset by unfavorable fair value adjustments and hedging activity, resulting in a net fair value loss of $1 million for the six months ended June 30, 2026, as compared to a net fair value gain of $9 million for the prior-year period.

Previous wording

•Non-interest expense was $394 million for the three months ended March 31, 2026, as compared to $340 million for the three months ended March 31, 2025. The increase was primarily driven by the combined operations following the Pacific Premier acquisition, including a $10 million increase in merger and restructuring expense to $24 million, as well as higher salaries and employee benefits and increased occupancy and software costs. The first quarter of 2025 included a $55 million legal settlement, which favorably impacted comparability.

Current wording

•Non-interest expense was $769 million for the six months ended June 30, 2026, as compared to $618 million for the six months ended June 30, 2025. The increase primarily reflects the combined operations following the Pacific Premier acquisition, including higher salaries and employee benefits, occupancy and software costs, intangible amortization, and merger and restructuring expense. The prior-year period included a $55 million legal settlement that did not occur in 2026.

Previous wording

•Total loans and leases were $47.7 billion as of March 31, 2026, a decrease of $79 million as compared to December 31, 2025. The decrease primarily reflects continued runoff in below-market-rate transactional loans, partially offset by growth in commercial loans, consistent with the Company's balance sheet optimization strategy.

Current wording

•Total loans and leases were $47.2 billion as of June 30, 2026, a decrease of $610 million as compared to December 31, 2025. The decrease primarily reflects ongoing balance sheet optimization efforts, including continued runoff of below-market-rate transactional loans, partially offset by growth in relationship-based commercial lending.

Previous wording

•Total consolidated assets were $66.0 billion as of March 31, 2026, as compared to $66.8 billion as of December 31, 2025. The decrease primarily reflects balance sheet optimization activity, including a reduction in excess cash balances as we fine-tuned our liquidity management strategy.

Current wording

•Total consolidated assets were $65.4 billion as of June 30, 2026, as compared to $66.8 billion as of December 31, 2025. The decrease primarily reflects the continued execution of the Company's balance sheet optimization strategy, including lower cash and transactional real estate loan balances and a reduction in wholesale funding.

Previous wording

•Non-performing assets were $264 million, or 0.40% of total assets, as of March 31, 2026, as compared to $200 million, or 0.30% of total assets, as of December 31, 2025. Non-performing loans and leases were $261 million, or 0.55% of total loans and leases, as of March 31, 2026, compared to $198 million, or 0.41% of total loans and leases, as of December 31, 2025. As of March 31, 2026, non-performing loans included $88 million in government guaranteed balances. The increases in non-performing assets and loans primarily reflects adverse performance in a single agricultural industry relationship and is not indicative of broader portfolio deterioration.

Current wording

•Non-performing assets were $273 million, or 0.42% of total assets, as of June 30, 2026, as compared to $200 million, or 0.30% of total assets, as of December 31, 2025. Non-performing loans and leases were $268 million, or 0.57% of total loans and leases, as of June 30, 2026, compared to $198 million, or 0.41% of total loans and leases, as of December 31, 2025. As of June 30, 2026, non-performing loans included $78 million in government guaranteed balances. The increases in non-performing assets and loans primarily reflect adverse performance in a single agricultural industry relationship and are not indicative of broader portfolio deterioration.

Previous wording

•Provision for credit losses was $28 million for the three months ended March 31, 2026, as compared to $23 million for the three months ended December 31, 2025 and $27 million for the three months ended March 31, 2025. The provision reflects changes in economic forecasts used in the ACL methodology.

Current wording

•Provision for credit losses was $27 million and $55 million for the three and six months ended June 30, 2026, as compared to $28 million for the three months ended March 31, 2026 and $57 million for the six months ended June 30, 2025. The provision reflects changes in variables that influence changes in the ACL between periods, as mentioned above.

Previous wording

•Total cash and cash equivalents were $2.1 billion as of March 31, 2026, a decrease of $281 million from December 31, 2025. The decline primarily reflects a reduction in interest-bearing cash balances as the Company optimized on balance sheet liquidity levels during the quarter, consistent with improved liquidity risk metrics compared to the prior year. The Company manages its cash position with a comprehensive liquidity framework designed to maintain a high-quality liquid asset base, fund lending and investment activity, and reduce debt and other non-deposit liabilities when market conditions are favorable.

Current wording

•Total cash and cash equivalents were $1.8 billion as of June 30, 2026, a decrease of $611 million from December 31, 2025. The decline primarily reflects a reduction in interest-bearing cash balances as the Company optimized on balance-sheet liquidity levels during the six months ended June 30, 2026, consistent with improved liquidity risk metrics compared to the prior year. The Company manages its cash position with a comprehensive liquidity framework designed to maintain a high-quality liquid asset base, fund lending and investment activity, and reduce debt and other non-deposit liabilities when market conditions are favorable.

Previous wording

•Including secured off-balance sheet lines of credit, total available liquidity was $27.1 billion as of March 31, 2026, representing 41% of total assets, 51% of total deposits, and 129% of estimated uninsured deposits.

Current wording

•Including secured off-balance sheet lines of credit, total available liquidity was $25.6 billion as of June 30, 2026, representing 39% of total assets, 49% of total deposits, and 125% of estimated uninsured deposits.

Previous wording

•The Company's total risk-based capital ratio was 13.4% and its common equity tier 1 ("CET1") capital ratio was 11.6% as of March 31, 2026. As of December 31, 2025, the Company's total risk-based capital ratio was 13.6% and its CET1 capital ratio was 11.8%. The modest decline in regulatory capital ratios primarily reflects capital actions during the quarter, including common share repurchases, while remaining well in excess of regulatory well-capitalized standards.

Current wording

•The Company's total risk-based capital ratio was 13.5% and its common equity tier 1 ("CET1") capital ratio was 11.7% as of June 30, 2026. As of December 31, 2025, the Company's total risk-based capital ratio was 13.6% and its CET1 capital ratio was 11.8%. The modest decline in regulatory capital ratios primarily reflects capital actions during the six months ended June 30, 2026, including common share repurchases, while remaining well in excess of regulatory well-capitalized standards.

Previous wording

•On October 29, 2025, Columbia's Board of Directors authorized the repurchase of up to $700 million of the Company's common stock under a new repurchase plan, which is scheduled to expire on November 30, 2026. During the three months ended March 31, 2026, the Company repurchased 6.5 million shares of common stock for $200 million. The timing and amount of common share repurchases remain subject to senior management discretion and subject to various factors, including, without limitation, Columbia’s capital position, financial performance, market conditions, and regulatory considerations. As of March 31, 2026, $400 million remained under the company's existing repurchase authorization.

Current wording

•On October 29, 2025, Columbia's Board of Directors authorized the repurchase of up to $700 million of the Company's common stock under a repurchase program, which is scheduled to expire on November 30, 2026. Under this program, during the three and six months ended June 30, 2026, the Company repurchased 6.6 million and 13.1 million shares of common stock, respectively, for $199 million and $398 million, respectively. The timing and amount of common share repurchases remain subject to senior management discretion and subject to various factors, including, without limitation, Columbia’s capital position, financial performance, market conditions, and regulatory considerations. As of June 30, 2026, $202 million remained available under the repurchase authorization.

Previous wording

Our critical accounting estimates are described in detail in the Critical Accounting Estimates section of our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on February 26, 2026. The consolidated financial statements are prepared in conformity with GAAP and follow general practices within the financial services industry in which the Company operates. This preparation requires management to make estimates, assumptions, and judgments that affect the amounts reported in the financial statements and accompanying notes. These estimates, assumptions, and judgments are based on information available as of the date of the financial statements; accordingly, as this information changes, actual results could differ from the estimates, assumptions, and judgments reflected in the financial statements. Certain estimates inherently have a greater reliance on the use of assumptions and judgments and, as such, have a greater possibility of producing results that could be materially different than originally reported. Management believes that the estimate for ACL and business combinations are important to the portrayal of the Company's financial condition and results of operations and require difficult, subjective, or complex judgments. There have been no material changes in the methodology of these estimates during the three months ended March 31, 2026.

Current wording

Our critical accounting estimates are described in detail in the Critical Accounting Estimates section of our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on February 26, 2026. The consolidated financial statements are prepared in conformity with GAAP and follow general practices within the financial services industry in which the Company operates. This preparation requires management to make estimates, assumptions, and judgments that affect the amounts reported in the financial statements and accompanying notes. These estimates, assumptions, and judgments are based on information available as of the date of the financial statements; accordingly, as this information changes, actual results could differ from the estimates, assumptions, and judgments reflected in the financial statements. Certain estimates inherently have a greater reliance on the use of assumptions and judgments and, as such, have a greater possibility of producing results that could be materially different than originally reported. Management believes that the estimate for the ACL and business combinations are important to the portrayal of the Company's financial condition and results of operations and require difficult, subjective, or complex judgments. There have been no material changes in the methodology of these estimates during the six months ended June 30, 2026.

Previous wording

Columbia's financial results for periods ended prior to August 31, 2025, the acquisition date for Pacific Premier, reflect Columbia's results only on a standalone basis. Accordingly, Columbia's reported financial results for the first eight months of 2025 include only Columbia's financial results through the closing of the acquisition. As a result, Columbia's financial results for the three months ended March 31, 2026, may not be directly comparable to results reported for periods prior to the acquisition or to future periods that fully reflect the combined operations.

Current wording

Columbia's financial results for periods ended prior to August 31, 2025, the acquisition date of Pacific Premier, reflect Columbia's results only on a standalone basis. Accordingly, Columbia's reported financial results for the first eight months of 2025 include only Columbia's financial results through the closing of the acquisition. As a result, Columbia's financial results for the six months ended June 30, 2026, may not be directly comparable to results reported for periods prior to the acquisition or to future periods that fully reflect the combined operations.

Previous wording

For the three months ended March 31, 2026, the Company had net income of $192 million, compared to $87 million for the same period in the prior year. The increase primarily reflects increases in net interest income and non-interest income of $169 million and $17 million, respectively, driven by the acquisition of Pacific Premier, which did not contribute to the results in the prior-year period, and our success replacing transactional loans and wholesale funding sources with relationship-centric business that contributes to loans, deposits, and recurring fee income streams, improving our profitability. These increases were partially offset by higher non-interest expense of $54 million and income tax expense of $26 million. The increase in non-interest expense reflects higher merger and restructuring expense, as well as increased salaries and employee benefits and occupancy and software costs associated with the Pacific Premier acquisition, partially offset by a $55 million accrual for a legal settlement recorded in the prior-year period, which did not repeat. The increase in income tax expense primarily reflects higher pre-tax income resulting from the acquisition.

Current wording

For the six months ended June 30, 2026, the Company reported net income of $400 million, compared to $239 million for the same period in 2025. The increase primarily reflects higher net interest income and non-interest income of $312 million and $40 million, respectively. These increases largely reflect the impact of the Pacific Premier acquisition, which did not contribute to the Company's results during the comparable prior-year period, as well as our continued balance sheet optimization efforts, including the replacement of transactional loans and wholesale funding sources with relationship-based commercial lending and customer deposits, as well as growth in recurring fee income streams, which improved profitability. These increases were partially offset by higher non-interest expense of $151 million and income tax expense of $42 million. The increase in FHLB advances was driven by a shift in the Bank's funding mix during 2026, as FHLB advance rates were more favorable than alternative wholesale funding sources, including brokered deposits. The increase in non-interest expense reflects increased salaries and employee benefits, occupancy, deposit costs, and higher merger and restructuring expense associated with the Pacific Premier acquisition, partially offset by a $55 million accrual for a legal settlement recognized in the prior-year period that did not recur. The increase in income tax expense primarily reflects higher pre-tax income resulting from the acquisition.

Previous wording

Net interest margin, calculated as net interest income as a percentage of average interest-earning assets on a fully tax-equivalent basis, was 3.96% for the three months ended March 31, 2026, as compared to 4.06% for the three months ended December 31, 2025. The decrease primarily reflects the absence of the prior quarter's 8-basis point benefit from the time deposit premium amortization and the absence of a 3-basis point benefit related to an accelerated loan repayment during the prior quarter. Lower earning asset yields resulting from recent reductions in the federal funds rate were offset by correspondingly lower deposit costs and continued improvement in the Company's funding mix, including a lower proportion of higher-cost brokered deposits.

Current wording

Net interest margin, calculated as net interest income as a percentage of average interest-earning assets on a fully tax-equivalent basis, was 3.93% for the three months ended June 30, 2026, as compared to 3.96% for the three months ended March 31, 2026. The 3 basis point decrease was driven primarily by interest income reversals during the three months ended June 30, 2026. Net interest margin was otherwise consistent between periods, as a lower yield on taxable securities was offset by lower funding costs resulting from reduced balances of higher-cost brokered deposits and lower deposit pricing.

Previous wording

The cost of interest-bearing deposits for the three months ended March 31, 2026 was 2.04%, a decrease of 4 basis points compared to the three months ended December 31, 2025. The decrease reflects proactive management of deposit rates surrounding the Federal Reserve's October and December rate cuts, as well as a favorable change in deposit mix, including a reduction in higher-cost brokered deposits. The prior quarter's cost of interest‑bearing deposits benefited from $12 million of amortization of premiums on Pacific Premier's time deposits, which concluded on December 31, 2025 and provided a 12-basis point benefit to the cost of interest-bearing deposits during the fourth quarter of 2025. The cost of interest-bearing liabilities for the three months ended March 31, 2026 was 2.24%, a decrease of 3 basis points compared to the three months ended December 31, 2025. The decrease reflects the same underlying drivers as interest-bearing deposits, partially offset by higher average borrowings for the three months ended March 31, 2026 relative to prior quarter, as balances increased late in December, due to an expected decline in customer deposit balances, given typical behavior related to year-end spending and business distributions.

Current wording

The cost of interest-bearing deposits for the three months ended June 30, 2026 was 1.96%, a decrease of 8 basis points compared to the three months ended March 31, 2026, reflecting lower deposit pricing and reduced balances of higher-cost brokered deposits. The cost of interest-bearing liabilities for the three months ended June 30, 2026 was 2.21%, a decrease of 3 basis points compared to the three months ended March 31, 2026. The decrease reflects the same underlying drivers as interest-bearing deposits, partially offset by higher average borrowings.

Previous wording

Net interest income for the three months ended March 31, 2026 was $594 million, an increase of $169 million compared to the three months ended March 31, 2025. The increase was primarily driven by an increase of $168 million in interest income, reflecting higher average loans and leases balances following the acquisition of Pacific Premier, with acquired balances recorded at fair value as of August 31, 2025.

Current wording

Net interest income for the six months ended June 30, 2026 was $1.2 billion, an increase of $312 million compared to the six months ended June 30, 2025. The increase was primarily driven by an additional $308 million of interest income resulting from higher average balances of loans and leases and investment securities acquired in the Pacific Premier acquisition, as well as Columbia's balance sheet optimization activity. Acquired balances were recorded at fair value as of August 31, 2025.

Previous wording

Net interest margin, calculated on a fully tax-equivalent basis, was 3.96% for the three months ended March 31, 2026, as compared to 3.60% for the three months ended March 31, 2025. The increase was primarily attributable to lower funding costs and a favorable balance sheet mix shift toward lower-cost customer deposits and away from higher-cost wholesale funding sources, which include borrowings and brokered deposits. The cost of interest-bearing liabilities was 2.24% for the three months ended March 31, 2026, compared to 2.80% for the three months ended March 31, 2025, a decrease of 56 basis points. The decrease was driven primarily by reductions in the federal funds rate and a continued optimization of the Company's funding mix. These benefits were partially offset by slightly lower earning-asset yields. The yield on earning assets was 5.44% for the three months ended March 31, 2026, compared to 5.49% for the three months ended March 31, 2025, a decrease of 5 basis points. The yield on loans and leases was 5.78% for the three months ended March 31, 2026, as compared to 5.92% for the three months ended March 31, 2025, a decrease of 14 basis points, reflecting the declining rate environment during 2025, partially offset by higher average loans and leases balances related to the Pacific Premier acquisition. An increase in the yield on investment securities reflected higher-yielding new purchases, including acquired securities recorded at fair value in connection with the Pacific Premier acquisition, replacing principal paydowns from lower-yielding securities, partially offsetting the decrease in the yield on loans and leases.

Current wording

Net interest margin, calculated on a fully tax-equivalent basis, was 3.94% for the six months ended June 30, 2026, as compared to 3.67% for the six months ended June 30, 2025. The increase was primarily attributable to lower funding costs and a favorable balance sheet mix shift toward lower-cost customer deposits and away from higher-cost wholesale funding sources, which include borrowings and brokered deposits. The cost of interest-bearing liabilities was 2.23% for the six months ended June 30, 2026, compared to 2.79% for the six months ended June 30, 2025, a decrease of 56 basis points. The decrease was driven primarily by reductions in the federal funds rate, continued optimization of the Company's funding mix, and lower balances of higher-cost funding sources. These benefits were partially offset by lower earning-asset yields. The yield on earning assets was 5.42% for the six months ended June 30, 2026, compared to 5.56% for the six months ended June 30, 2025, a decrease of 14 basis points. The yield on loans and leases was 5.78% for the six months ended June 30, 2026, as compared to 5.96% for the six months ended June 30, 2025, a decrease of 18 basis points, reflecting the declining rate environment during 2025, partially offset by the replacement of lower-yielding transactional loans with relationship-based commercial loans. An increase in the yield on investment securities reflects higher-yielding new purchases, including acquired securities recorded at fair value in connection with the Pacific Premier acquisition, replacing principal paydowns from lower-yielding securities, partially offsetting the decrease in the yield on loans and leases.

Previous wording

During 2025, the Federal Reserve reduced the target range for the federal funds rate by an aggregate of 0.75% through a series of 0.25% reductions primarily implemented in the fourth quarter. The target range remained unchanged during the first quarter of 2026. As of March 31, 2026, the balance sheet remains modestly liability sensitive. Management expects customer deposit balance trends and continued optimization of the funding mix to be key drivers of net interest margin performance, as the Company continues to target a lower reliance on wholesale funding sources, including FHLB advances and brokered deposits.

Current wording

During 2025, the Federal Reserve reduced the target range for the federal funds rate by an aggregate of 0.75% through a series of 0.25% reductions primarily implemented in the fourth quarter. The target range remained unchanged during the first six months of 2026. As of June 30, 2026, the balance sheet remains modestly liability sensitive. Management expects customer deposit balance trends, replacement of wholesale funding sources with relationship-based deposits, and continued optimization of the funding mix to be key drivers of net interest margin performance as the Company continues to target a lower reliance on brokered deposits and FHLB advances.

Previous wording

The Company had a $28 million provision for credit losses for the three months ended March 31, 2026, as compared to $27 million for the three months ended March 31, 2025. The increase reflects loan portfolio runoff, credit migration trends, and updated economic forecasts incorporated into the Company's credit loss models. As an annualized percentage of average outstanding loans and leases, the provision for credit losses recorded for the three months ended March 31, 2026 was 0.24%, as compared to 0.29% for the three months ended March 31, 2025.

Current wording

The Company had a $27 million provision for credit losses for the three months ended June 30, 2026, as compared to a $28 million provision for the three months ended March 31, 2026. The provision remained relatively stable quarter over quarter, reflecting the combined effect of lower loan portfolio balances, updated economic assumptions, portfolio activity and credit migration, and changes to the Company's ACL estimation methodology and qualitative adjustments. As an annualized percentage of average outstanding loans and leases, the provision for credit losses recorded for the three months ended June 30, 2026 was 0.23%, as compared to 0.24% for the three months ended March 31, 2026.

Previous wording

For the three months ended March 31, 2026 and December 31, 2025, net charge-offs were $35 million and $30 million, respectively. As an annualized percentage of average outstanding loans and leases, net charge-offs for the three months ended March 31, 2026 were 0.30%, as compared to 0.25% for the three months ended December 31, 2025. Net charge-offs within the FinPac portfolio were $14 million for the three months ended March 31, 2026 and December 31, 2025. Excluding the FinPac portfolio, net charge-offs were $21 million, as compared to $16 million in the prior period.

Current wording

For the three months ended June 30, 2026 and March 31, 2026, net charge-offs were $30 million and $35 million, respectively. As an annualized percentage of average outstanding loans and leases, net charge-offs for the three months ended June 30, 2026 were 0.25%, as compared to 0.30% for the three months ended March 31, 2026. Net charge-offs within the FinPac portfolio were $15 million for the three months ended June 30, 2026, as compared to $14 million three months ended March 31, 2026. Excluding the FinPac portfolio, net charge-offs were $15 million, as compared to $21 million for the prior quarter, reflecting improved charge-off performance across the remainder of the loan portfolio.

Previous wording

The Company had a $28 million provision for credit losses for the three months ended March 31, 2026, as compared to a $23 million provision for the three months ended December 31, 2025. The increase was primarily driven by credit migration trends and updated economic forecasts incorporated into the Company's credit loss models. As an annualized percentage of average outstanding loans and leases, the provision for credit losses recorded for the three months ended March 31, 2026 was 0.24%, as compared to 0.19% for the three months ended December 31, 2025.

Current wording

The Company had a $55 million provision for credit losses for the six months ended June 30, 2026, as compared to $57 million for the six months ended June 30, 2025. The decrease in the provision reflects changes in loan portfolio balances, economic assumptions, portfolio activity and credit migration, and changes to the Company's ACL estimation methodology and qualitative adjustments. As an annualized percentage of average outstanding loans and leases, the provision for credit losses recorded for the six months ended June 30, 2026 was 0.23%, as compared to 0.30% for the six months ended June 30, 2025.

Previous wording

For the three months ended March 31, 2026, net charge-offs were $35 million, as compared to $30 million for the three months ended March 31, 2025. As an annualized percentage of average outstanding loans and leases, net charge-offs for the three months ended March 31, 2026 were 0.30%, as compared to 0.32% for the three months ended March 31, 2025. Net charge-offs in the FinPac portfolio were $14 million for the three months ended March 31, 2026, as compared to $17 million for the three months ended March 31, 2025, which is reflective of continued improvement of the lease portfolio. Net charge-offs for the Bank were $21 million and $13 million for the three months ended March 31, 2026 and 2025, respectively.

Current wording

For the six months ended June 30, 2026, net charge-offs were $65 million, as compared to $59 million for the six months ended June 30, 2025. As an annualized percentage of average outstanding loans and leases, net charge-offs for the six months ended June 30, 2026 were 0.28%, as compared to 0.31% for the six months ended June 30, 2025. Net charge-offs within the FinPac portfolio were $29 million for the six months ended June 30, 2026, as compared to $31 million for the six months ended June 30, 2025, reflecting continued improvement in the FinPac lease portfolio. Excluding the FinPac portfolio, net charge-offs were $36 million and $28 million for the six months ended June 30, 2026 and 2025, respectively, with the variance driven primarily by commercial loan charge-offs.

Previous wording

Residential mortgage banking revenue increased during the three months ended March 31, 2026. The increase was primarily driven by a $6 million gain on the fair value of the MSR asset related to changes in valuation inputs and assumptions, compared to a loss of $1 million for the three months ended December 31, 2025.

Current wording

Residential mortgage banking revenue decreased during the three months ended June 30, 2026. The decrease was primarily driven by a lower gain on the fair value of the MSR asset related to changes in valuation inputs and assumptions, with a $1 million gain recognized during the three months ended June 30, 2026, compared to a gain of $6 million for the three months ended March 31, 2026.

Previous wording

Financial services and trust revenue increased during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase reflects the combined operations following the acquisition of Pacific Premier, which contributed to higher transaction volumes and an expanded client base. In addition, the Pacific Premier acquisition significantly expanded the Company's wealth management platform through the addition of Pacific Premier's custodial trust business, resulting in a 200% increase in financial services and trust revenue compared to the prior-year period.

Current wording

Financial services and trust revenue increased during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. The increase reflects the combined operations following the acquisition of Pacific Premier, which contributed to higher transaction volumes and an expanded client base. In addition, the Pacific Premier acquisition significantly expanded the Company's wealth management platform through the addition of Pacific Premier's custodial trust business, resulting in a 173% increase in financial services and trust revenue compared to the prior-year period.

Previous wording

Gain (loss) on certain loans held for investment, at fair value, resulted in a loss of $2 million for the three months ended March 31, 2026, compared to a gain of $7 million for the three months ended March 31, 2025. The variance was primarily driven by changes in interest rates between periods.

Current wording

Gain (loss) on certain loans held for investment, at fair value, resulted in a loss of $3 million for the six months ended June 30, 2026, compared to a gain of $7 million for the six months ended June 30, 2025. The variance was primarily driven by changes in market interest rates and related fair value adjustments between periods.

Previous wording

Other income increased during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to favorable changes in swap related income, a reduction in swap derivative loss, higher miscellaneous income, and increased loan related fees, resulting in a net increase of $7 million between periods.

Current wording

Other income increased during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, primarily due to $3 million of BOLI death benefit proceeds from a single policy, as well as increased miscellaneous income, swap related income, loan related fees, and a reduction in swap derivative loss, resulting in a net increase of $13 million between periods.

Previous wording

Merger and restructuring expense decreased during the three months ended March 31, 2026, as compared to the three months ended December 31, 2025, reflecting lower charitable contributions, legal and professional fees, and personnel-related costs.

Current wording

Merger and restructuring expense decreased during the three months ended June 30, 2026, as compared to the three months ended March 31, 2026, reflecting lower personnel-related costs, legal and professional fees, and occupancy and benefit expense, as integration activities associated with the Pacific Premier acquisition continued to wind down.

Previous wording

Salaries and employee benefits increased during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily reflecting expenses associated with a larger employee base following the acquisition of Pacific Premier.

Current wording

Salaries and employee benefits increased during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, primarily due to the addition of Pacific Premier employees following the acquisition.

Previous wording

Occupancy and equipment, net increased during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to an expanded branch footprint and higher software costs resulting from the acquisition of Pacific Premier.

Current wording

Occupancy and equipment, net increased during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, primarily due to the expanded branch network and additional technology and software costs resulting from the acquisition of Pacific Premier.

Previous wording

Deposit costs increased during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily driven by higher HOA-related fees following the expansion of the Company's HOA banking business as part of the acquisition of Pacific Premier.

Current wording

Deposit costs increased during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, primarily driven by higher HOA-related fees associated with the growth in the Company's HOA banking business as part of the acquisition of Pacific Premier.

Previous wording

Intangible amortization increased during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, reflecting amortization of the core deposit intangibles recognized in connection with the acquisition of Pacific Premier. Refer to Note 6 –Goodwill and Other Intangible Assetsfor additional information regarding expected amortization expense.

Current wording

Intangible amortization increased during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, reflecting the ongoing amortization of the core deposit intangibles recognized in the acquisition of Pacific Premier. Refer to Note 6 –Goodwill and Other Intangible Assetsfor additional information regarding expected amortization expense.