BankUnited, Inc.

Previous wording

The following discussion and analysis is intended to focus on significant matters impacting and changes in the financial condition and results of operations of the Company during the three and six months ended June 30, 2025 and should be read in conjunction with the consolidated financial statements and notes hereto included in this Quarterly Report on Form 10-Q and BKU's 2024 Annual Report on Form 10-K for the year ended December 31, 2024 (the "2024 Annual Report on Form 10-K").

Current wording

The following discussion and analysis is intended to focus on significant matters impacting and changes in the financial condition and results of operations of the Company during the three and nine months ended September 30, 2025 and should be read in conjunction with the consolidated financial statements and notes hereto included in this Quarterly Report on Form 10-Q and BKU's 2024 Annual Report on Form 10-K for the year ended December 31, 2024 (the "2024 Annual Report on Form 10-K").

Previous wording

In evaluating our financial performance, we consider (i) the funding mix and the composition of interest earning assets; (ii) the level of and trends in net interest income and the net interest margin; (iii) the cost of deposits, trends in non-interest income and non-interest expense; (iv) performance ratios such as the return on average equity and return on average assets and asset quality ratios, including the ratios of non-performing loans to total loans and non-performing assets to total assets; (v) trends in criticized and classified assets; and (vi) and portfolio delinquency and charge-off trends. We analyze these ratios and trends against our own historical performance, our expected performance, our risk appetite and the financial condition and performance of comparable financial institutions.

Current wording

In evaluating our financial performance, we consider (i) the funding mix and the composition of interest earning assets; (ii) the level of and trends in net interest income and the net interest margin; (iii) the cost of deposits, trends in non-interest income and non-interest expense; (iv) performance ratios such as the return on average equity and return on average assets and trends in those metrics; and (v) asset quality metrics, including the level of criticized and classified assets, the ratios of non-performing loans to total loans and non-performing assets to total assets, delinquency and net charge-off rates, as well as trends in those metrics. We analyze these ratios and trends against our own historical performance, our expected performance, our risk appetite and the financial condition and performance of comparable financial institutions.

Previous wording

•Net Income for the three months ended June 30, 2025 was $68.8 million, or $0.91 per diluted share, compared to $58.5 million or $0.78 per diluted share for the immediately preceding quarter ended March 31, 2025, an 18% increase. Net income was $53.7 million, or $0.72 per diluted share for the three months ended June 30, 2024. Net income for the six months ended June 30, 2025 was $127.2 million, or $1.68 per diluted share, compared to $101.7 million, or $1.36 per diluted share for the six months ended June 30, 2024, an increase of 25%.

Current wording

•Net income for the three months ended September 30, 2025 was $71.9 million, or $0.95 per diluted share, compared to $68.8 million or $0.91 per diluted share for the immediately preceding quarter ended June 30, 2025. Net income was $61.5 million, or $0.81 per diluted share for the three months ended September 30, 2024. Net income for the nine months ended September 30, 2025 was $199.1 million, or $2.63 per diluted share, compared to $163.2 million, or $2.17 per diluted share for the nine months ended September 30, 2024, an increase of 21% in diluted earnings per share.

Previous wording

•For the three months ended June 30, 2025, the annualized return on average stockholders' equity was 9.4% compared to 8.2% for the three months ended March 31, 2025 and 8.0% for the three months ended June 30, 2024. Return on average assets improved to 0.78% for the three months ended June 30, 2025, from 0.68% and 0.61% for the three months ended March 31, 2025 and June 30, 2024, respectively.

Current wording

•For the three months ended September 30, 2025, the annualized return on average stockholders' equity was 9.5% compared to 9.4% for the three months ended June 30, 2025 and 8.8% for the three months ended September 30, 2024. Return on average assets improved to 0.82% for the three months ended September 30, 2025, from 0.78% and 0.69% for the three months ended June 30, 2025 and September 30, 2024, respectively.

Previous wording

•As expected, the net interest margin, calculated on a tax-equivalent basis, expanded by 0.12%, to 2.93% for the three months ended June 30, 2025 from 2.81% for the immediately preceding three months ended March 31, 2025. The net interest margin was 2.72% for the three months ended June 30, 2024.

Current wording

•The net interest margin, calculated on a tax-equivalent basis, expanded by 0.07%, to 3.00% for the three months ended September 30, 2025 from 2.93% for the immediately preceding three months ended June 30, 2025. The net interest margin was 2.78% for the three months ended September 30, 2024.

Previous wording

•The average cost of total deposits declined by 0.11% to 2.47% for the three months ended June 30, 2025, from 2.58% for the immediately preceding three months ended March 31, 2025. The spot APY of total deposits declined by 0.15% to 2.37% at June 30, 2025 from 2.52% at March 31, 2025. The spot APY of total deposits was 3.09% at June 30, 2024, one year ago.

Current wording

•The average cost of total deposits declined by 0.09% to 2.38% for the three months ended September 30, 2025, from 2.47% for the immediately preceding three months ended June 30, 2025. The spot APY of total deposits declined by 0.06% to 2.31% at September 30, 2025 from 2.37% at June 30, 2025. The spot APY of total deposits was 2.93% at September 30, 2024, one year ago.

Previous wording

•For the three months ended June 30, 2025, CRE loans grew by $267 million, largely in line with our expectations. C&I loans declined by $199 million; a continued high level of unscheduled payoffs and some strategic exits impacted C&I growth. Consistent with our balance sheet strategy, the residential, franchise, equipment and municipal finance portfolios declined by a combined $171 million. Total loans declined by $56 million for the three months ended June 30, 2025.

Current wording

•For the three months ended September 30, 2025 total loans declined by $231 million. In the aggregate, consistent with our balance sheet strategy, the residential, franchise, equipment and municipal finance portfolios declined by a combined $245 million while the core commercial portfolio segments and mortgage warehouse grew by a combined $14 million.

Previous wording

•The loan to deposit ratio declined to 83.6% at June 30, 2025, from 85.5% at March 31, 2025 and 87.2% at December 31, 2024.

Current wording

•The loan to deposit ratio declined to 82.8% at September 30, 2025, from 83.6% at June 30, 2025 and 87.2% at December 31, 2024.

Previous wording

•With respect to credit, total criticized and classified loans declined by $156 million for the three months ended June 30, 2025. We experienced net migration of $117 million of loans to non-accrual for the quarter, the majority of which, not unexpectedly, was attributable to office exposure. The NPA ratio at June 30, 2025 was 1.08%, including 0.10% related to the guaranteed portion of non-performing SBA loans, compared to 0.76% including 0.09% related to the guaranteed portion of non-accrual SBA loans at March 31, 2025. The annualized net charge-off ratio for the six months ended June 30, 2025, was 0.27%. The net charge-off ratio for the trailing twelve months was 0.23%.

Current wording

•Total criticized and classified loans declined by $3 million for the three months ended September 30, 2025 while non-accrual loans increased by $3 million. The annualized net charge-off ratio for the nine months ended September 30, 2025, was 0.26%; the net charge-off ratio for the trailing twelve months was 0.27%. The NPA ratio at September 30, 2025 was 1.10%, including 0.11% related to the guaranteed portion of non-performing SBA loans, compared to 1.08% including 0.10% related to the guaranteed portion of non-accrual SBA loans at June 30, 2025.

Previous wording

•The ratio of the ACL to total loans was 0.93% at June 30, 2025, compared to 0.92% at March 31, 2025. The ratio of the ACL to non-performing loans was 59.18%. The ACL to loans ratio for commercial portfolio sub-segments including C&I, CRE, franchise finance and equipment finance was 1.36% at June 30, 2025 and the ACL to loans ratio for CRE office loans was 1.92%. The provision for credit losses was $15.7 million for the three months ended June 30, 2025 compared to $15.1 million for the preceding three months ended March 31, 2025 and $19.5 million for the three months ended June 30, 2024.

Current wording

•The ratio of the ACL to total loans was 0.93% at September 30, 2025, consistent with prior quarter-end. The ratio of the ACL to non-performing loans was 57.95%. The ACL to loans ratio for commercial portfolio sub-segments including C&I, CRE, franchise finance and equipment finance was 1.35% at September 30, 2025 and the ACL to loans ratio for CRE office loans was 2.21%. The provision for credit losses was $11.6 million for the three months ended September 30, 2025 compared to $15.7 million for the preceding three months ended June 30, 2025 and $9.2 million for the three months ended September 30, 2024.

Previous wording

•Our capital position is robust. At June 30, 2025, CET1 was 12.2% and pro-forma CET1, including accumulated other comprehensive income, was 11.3%. The ratio of tangible common equity/tangible assets increased to 8.1%.

Current wording

•Our capital position is robust. At September 30, 2025, CET1 was 12.5% and pro-forma CET1, including accumulated other comprehensive income, was 11.7%. The ratio of tangible common equity/tangible assets increased to 8.4%.

Previous wording

•Book value and tangible book value per common share continued to accrete, to $39.26 and $38.23, respectively, at June 30, 2025, compared to $38.51 and $37.48, respectively, at March 31, 2025, and $36.11 and $35.07, respectively, at June 30, 2024. This represents a 9% year-over-year increase in tangible book value per share.

Current wording

•Book value and tangible book value per common share continued to accrete, to $40.30 and $39.27, respectively, at September 30, 2025, compared to $39.26 and $38.23, respectively, at June 30, 2025, and $37.56 and $36.52, respectively, at September 30, 2024. This represents an 8% year-over-year increase in tangible book value per share.

Previous wording

(1)On a tax-equivalent basis where applicable. The tax-equivalent adjustment for tax-exempt loans was $2.7 million for both the three months ended June 30, 2025 and March 31, 2025, and $3.1 million for the three months ended June 30, 2024. The tax-equivalent adjustment for tax-exempt investment securities was $0.7 million for both the three months ended June 30, 2025 and March 31, 2025, and $0.9 million for the three months ended June 30, 2024.

Current wording

(1)On a tax-equivalent basis where applicable. The tax-equivalent adjustment for tax-exempt loans was $2.9 million for the three months ended September 30, 2025, $2.7 million for the three months ended June 30, 2025, and $3.0 million for the three months ended September 30, 2024. The tax-equivalent adjustment for tax-exempt investment securities was $0.7 million for both the three months ended September 30, 2025 and June 30, 2025, and $0.9 million for the three months ended September 30, 2024.

Previous wording

(1)On a tax-equivalent basis where applicable. The tax-equivalent adjustment for tax-exempt loans was $5.4 million and $6.3 million for the six months ended June 30, 2025 and 2024, respectively. The tax-equivalent adjustment for tax-exempt investment securities was $1.4 million and $1.7 million for the six months ended June 30, 2025 and 2024, respectively.

Current wording

(1)On a tax-equivalent basis where applicable. The tax-equivalent adjustment for tax-exempt loans was $8.3 million and $9.3 million for the nine months ended September 30, 2025 and 2024, respectively. The tax-equivalent adjustment for tax-exempt investment securities was $2.1 million and $2.6 million for the nine months ended September 30, 2025 and 2024, respectively.

Previous wording

Net interest income, calculated on a tax-equivalent basis, was $249.5 million for the three months ended June 30, 2025, compared to $236.6 million for the three months ended March 31, 2025, an increase of $12.9 million. The increase was comprised of an increase in tax-equivalent interest income of $10.1 million and a decrease in interest expense of $2.9 million for the three months ended June 30, 2025, compared to the three months ended March 31, 2025. The quarter-over-quarter increase in interest income was primarily related to higher yields on loans. The decline in interest expense related to both a lower average cost of funds and lower average balance of interest bearing liabilities.

Current wording

Net interest income, calculated on a tax-equivalent basis, was $253.7 million for the three months ended September 30, 2025, compared to $249.5 million for the three months ended June 30, 2025, an increase of $4.2 million. The increase was comprised of decreases in tax-equivalent interest income and interest expense of $0.7 million and $4.9 million, respectively, for the three months ended September 30, 2025 compared to the three months ended June 30, 2025. The decline in interest expense related to both a lower average cost of funds and lower average balance of interest bearing liabilities.

Previous wording

The net interest margin, calculated on a tax-equivalent basis, increased by 0.12% to 2.93% for the three months ended June 30, 2025, compared to 2.81% for the immediately preceding three months ended March 31, 2025. Factors impacting the net interest margin for the three months ended June 30, 2025 compared to the three months ended March 31, 2025 included:

Current wording

The net interest margin, calculated on a tax-equivalent basis, increased by 0.07% to 3.00% for the three months ended September 30, 2025, compared to 2.93% for the immediately preceding three months ended June 30, 2025. Factors impacting the net interest margin for the three months ended September 30, 2025 compared to the three months ended June 30, 2025 included:

Previous wording

•The net interest margin was positively impacted by the increase in average NIDDA as a percentage of both total deposits and total funding. Average NIDDA grew by $581 million for the three months ended June 30, 2025, while average interest bearing deposits declined by $290 million.

Current wording

•The net interest margin was positively impacted by a more favorable funding mix. Average NIDDA increased as a percentage of both total deposits and total funding, growing by $210 million for the three months ended September 30, 2025, while average interest bearing liabilities declined by $526 million.

Previous wording

•The average rate paid on interest bearing deposits declined to 3.48% for the three months ended June 30, 2025, from 3.54% for the three months ended March 31, 2025. This decline reflected the maturity of higher-rate term deposits, a reduction in higher priced brokered deposits and continued pricing discipline.

Current wording

•The average rate paid on interest bearing deposits declined to 3.40% for the three months ended September 30, 2025, from 3.48% for the three months ended June 30, 2025. This decline reflected the maturity of higher-rate term deposits, actions taken to proactively reduce deposit pricing in response to a lower Federal funds rate and higher priced brokered deposits, on average, declining for the quarter. The redemption of higher cost senior debt also positively impacted the cost of funds.

Previous wording

•The average rate paid on FHLB advances increased to 3.79% for the three months ended June 30, 2025, from 3.69% for the three months ended March 31, 2025, primarily due to expiration of cash flow hedges, partially offset by maturities of higher rate advances.

Current wording

•The average rate paid on FHLB advances increased to 3.94% for the three months ended September 30, 2025, from 3.79% for the three months ended June 30, 2025, primarily due to expiration of cash flow hedges.

Previous wording

The net interest margin, calculated on a tax-equivalent basis, increased to 2.93% and 2.87% for the three and six months ended June 30, 2025, respectively, from 2.72% and 2.64% for the three and six months ended June 30, 2024, increases of 0.21% and 0.23%, respectively. Both the yield on interest earning assets and the cost of interest bearing liabilities declined over these comparative periods reflecting a lower interest rate environment, however the decline in the cost of interest bearing liabilities outpaced the decline in the yield on interest earning assets, primarily as a result of balance sheet repositioning, particularly an improved funding mix.

Current wording

The net interest margin, calculated on a tax-equivalent basis, increased to 3.00% and 2.92% for the three and nine months ended September 30, 2025, respectively, from 2.78% and 2.69% for the three and nine months ended September 30, 2024, increases of 0.22% and 0.23%, respectively. Both the yield on interest earning assets and the cost of interest bearing liabilities declined over these comparative periods reflecting a lower interest rate environment, however the decline in the cost of interest bearing liabilities outpaced the decline in the yield on interest earning assets, primarily as a result of balance sheet repositioning, particularly an improved funding mix.

Previous wording

For the three months ended June 30, 2025 compared to the three months ended June 30, 2024, average NIDDA grew by $545 million while average FHLB advances declined by $823 million. For the six months ended June 30, 2025 compared to the six months ended June 30, 2024, average NIDDA grew by $700 million while average FHLB advances declined by $1.2 billion. Within interest bearing deposits, there was a shift from generally higher priced time deposits to generally lower priced forms of interest bearing deposits for both the three and six month periods. On the asset side of the balance sheet, average core C&I and CRE loans increased to 63.0% and 62.8% of average loans for the three and six months ended June 30, 2025, respectively, from 60.4% and 60.1% of average loans for the three and six months ended June 30, 2024, respectively, while generally lower yielding residential loans declined to 30.9% and 31.2% of average loans from 32.8% and 33.1% of average loans for the respective periods.

Current wording

For the three months ended September 30, 2025 compared to the three months ended September 30, 2024, average NIDDA grew by $819 million while average FHLB advances declined by $545 million. For the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, average NIDDA grew by $741 million while average FHLB advances declined by $980 million. Within interest bearing deposits, there was a shift from generally higher priced time deposits to generally lower priced forms of interest bearing deposits for both the three and nine month periods. On the asset side of the balance sheet, average core C&I and CRE loans increased to 63.2% and 63.0% of average loans for the three and nine months ended September 30, 2025, respectively, from 61.4% and 60.6% of average loans for the three and nine months ended September 30, 2024, respectively, while generally lower yielding residential loans declined to 30.7% and 31.0% of average loans from 32.2% and 32.8% of average loans for the respective periods.

Previous wording

The provision for credit losses may be volatile and the level of the ACL may change materially from current levels. Future levels of the ACL could be significantly impacted, in either direction, by changes in factors such as, but not limited to, economic conditions or the economic outlook, the composition of the loan portfolio, the financial condition of our borrowers and collateral values. In the current environment, changes in economic conditions could be particularly impactful.

Current wording

The provision for credit losses may be volatile and the level of the ACL may change materially from current levels. Future levels of the ACL could be significantly impacted, in either direction, by changes in factors such as, but not limited to, economic conditions or the economic outlook, the composition of the loan portfolio, the financial condition of our borrowers and collateral values.

Previous wording

The decrease in lease financing revenue for the three and six months ended June 30, 2025, compared to the three and six months ended June 30, 2024, was attributable to the continuing decline in the size of the operating lease equipment portfolio and lower residual income. Expense related to the depreciation of operating lease equipment reflected a corresponding decline over these comparative periods.

Current wording

The decrease in lease financing revenue for the three and nine months ended September 30, 2025, compared to the three and nine months ended September 30, 2024, was attributable primarily to the continuing decline of the operating lease equipment portfolio. Expense related to the depreciation of operating lease equipment also reflected a declining trend over these comparative periods.

Previous wording

The more significant items included in other non-interest income typically include commercial card revenue, lending related fees other than origination fees, income related to BOLI, securities gains and losses and capital markets revenue such as customer derivative, FX and syndication fees, none of which are individually material for any of the periods presented. The increase in other non-interest income for the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024, was primarily driven by an increases in capital markets and BOLI revenue.

Current wording

The more significant items included in other non-interest income in the table above typically may include commercial card revenue, lending related fees other than origination fees, syndication fees, BOLI income, securities gains and losses and FX fees.

Previous wording

The decrease in deposit insurance expense was primarily attributable to a $5.2 million FDIC special assessment incurred during the six months ended June 30, 2024.

Current wording

The decrease in deposit insurance expense was primarily attributable to a $5.2 million FDIC special assessment incurred during the nine months ended September 30, 2024. A lower base assessment rate for the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024, also contributed to the decline in deposit insurance expense.

Previous wording

The decline in depreciation of operating lease equipment for the six months ended June 30, 2025 was primarily attributable to the continued decline in the size of the operating lease equipment portfolio as discussed above.

Current wording

The decline in depreciation of operating lease equipment for the nine months ended September 30, 2025 was primarily attributable to the continued decline in the size of the operating lease equipment portfolio as discussed above.

Previous wording

We have continued to execute on our organic balance sheet transformation strategy, focused on improving both the funding profile and asset mix. For the six months ended June 30, 2025, NIDDA grew by $1.5 billion from 27% to 32% of total deposits, and non-brokered deposits grew by $1.9 billion. Wholesale funding, including FHLB advances and brokered deposits, declined by $1.8 billion. Year-over-year, for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, average NIDDA grew by $700 million. While growth of the core C&I and CRE loan portfolio segments fell short of our expectations, declining by $38 million for the six months ended June 30, 2025, consistent with our balance sheet strategy, lower yielding residential loans declined by $277 million, and franchise, equipment, and municipal finance declined by a combined $90 million. The core C&I and CRE portfolio segments comprised 63.4% of total loans at June 30, 2025, up from 62.5% at December 31, 2024 while residential loans declined to 30.5% of total loans at June 30, 2025 from 31.2% at December 31, 2024. The securities portfolio grew by $271 million over this six month period. The loan-to-deposit ratio improved to 83.6% at June 30, 2025 from 87.2% at December 31, 2024.

Current wording

Total loans declined by $595 million for the nine months ended September 30, 2025. Consistent with our balance sheet strategy, the residential, franchise, equipment and municipal finance portfolios declined by $612 million, while the core commercial portfolio segments and mortgage warehouse grew by $17 million. The core C&I and CRE portfolio segments comprised 63.6% of total loans at September 30, 2025, up from 62.5% at December 31, 2024 while residential loans declined to 30.1% of total loans at September 30, 2025 from 31.2% at December 31, 2024. The securities portfolio grew by $337 million over this nine month period. The loan-to-deposit ratio was 82.8% at September 30, 2025 compared to 87.2% at December 31, 2024.

Previous wording

Our investment strategy is focused on ensuring adequate liquidity, maintaining a suitable balance of high credit quality, diverse assets, managing interest rate risk, and generating acceptable returns given our established risk parameters. We have sought to maintain liquidity by investing a significant portion of the portfolio in high quality liquid securities including U.S. Treasury and U.S. Government Agency and sponsored enterprise securities. We have also invested in highly-rated structured products, including private-label commercial and residential MBS, CLOs, single family real estate-backed securities and non-mortgage asset-backed securities that, while somewhat less liquid, are generally pledgeable at either the FHLB or the FRB and provide us with attractive yields. Investment grade municipal securities provide liquidity and attractive tax-equivalent yields. We remain committed to keeping the duration of our securities portfolio short; relatively short effective portfolio duration helps mitigate interest rate risk. The estimated effective duration of the investment portfolio was 1.67 years andthe estimated weighted average life of the portfolio was 5.3 yearsas of June 30, 2025. Approximately 71% of the securities portfolio was floating rate at June 30, 2025.

Current wording

Our investment strategy is focused on ensuring adequate liquidity, maintaining a suitable balance of high credit quality, diverse assets, managing interest rate risk, and generating acceptable returns given our established risk parameters. We have sought to maintain liquidity by investing a significant portion of the portfolio in high quality liquid securities including U.S. Treasury and U.S. Government Agency and sponsored enterprise securities. We have also invested in highly-rated structured products, including private-label commercial and residential MBS, CLOs, single family real estate-backed securities and non-mortgage asset-backed securities that, while somewhat less liquid, are generally pledgeable at either the FHLB or the FRB and provide us with attractive yields. Investment grade municipal securities provide liquidity and attractive tax-equivalent yields. We remain committed to keeping the duration of our securities portfolio short; relatively short effective portfolio duration helps mitigate interest rate risk. The estimated effective duration of the investment portfolio was 1.60 years andthe estimated weighted average life of the portfolio was 5.0 yearsas of September 30, 2025. Approximately 72% of the securities portfolio was floating rate at September 30, 2025.

Previous wording

The investment securities AFS portfolio was in a net unrealized loss position of $330.0 million at June 30, 2025, an improvement of $75.6 million compared to a net unrealized loss position of $405.6 million at December 31, 2024. Net unrealized losses at June 30, 2025 included $17.2 million of gross unrealized gains and $347.2 million of gross unrealized losses. Investment securities available for sale in unrealized loss positions at June 30, 2025 had an aggregate fair value of $5.8 billion. The unrealized losses resulted primarily from a sustained period of higher interest rates, and in some cases, wider spreads compared to the levels at which securities were purchased. None of the unrealized losses were attributable to credit loss impairments.

Current wording

The investment securities AFS portfolio was in a net unrealized loss position of $289.9 million at September 30, 2025, an improvement of $115.7 million compared to a net unrealized loss position of $405.6 million at December 31, 2024. The improvement in unrealized losses is largely due to a declining interest rate environment. Net unrealized losses at September 30, 2025 included $22.5 million of gross unrealized gains and $312.4 million of gross unrealized losses. Investment securities available for sale in unrealized loss positions at September 30, 2025 had an aggregate fair value of $4.5 billion. The unrealized losses resulted primarily from a sustained period of higher interest rates, and in some cases, wider spreads compared to the levels at which securities were purchased. None of the unrealized losses were attributable to credit loss impairments.

Previous wording

We have not sold, and do not anticipate the need to sell, securities in unrealized loss positions to generate liquidity. Additionally, we do not intend to sell securities in significant unrealized loss positions at June 30, 2025. Based on an assessment of our liquidity position and internal and regulatory guidelines for permissible investments and concentrations, it is not more likely than not that we will be required to sell securities in significant unrealized loss positions prior to recovery of amortized cost basis, which may be at maturity. The substantial majority of our investment securities are eligible to be pledged at either the FHLB or FRB.

Current wording

We have not sold, and do not anticipate the need to sell, securities in unrealized loss positions to generate liquidity. At September 30, 2025, the Company did not have an intent to sell securities that were in significant unrealized loss positions, and it was not more likely than not that the Company would be required to sell these securities before recovery of the amortized cost basis, which may be at maturity. The substantial majority of our investment securities are eligible to be pledged at either the FHLB or FRB.

Previous wording

Commercial loans include a diverse portfolio of commercial and industrial loans and lines of credit, loans secured by owner-occupied commercial real-estate, income-producing non-owner occupied commercial real estate, a smaller amount of construction loans, SBA loans, mortgage warehouse lines of credit, municipal loans and leases and franchise and equipment finance loans and leases.

Current wording

Commercial loans include a diverse portfolio of commercial and industrial loans and lines of credit, loans secured by owner-occupied commercial real-estate, income-producing non-owner occupied commercial real estate, construction loans, SBA loans, mortgage warehouse lines of credit, municipal loans and leases and franchise and equipment finance loans and leases.

Previous wording

(2)CRE peer median information based on March 31, 2025 Call Report data for banks with total assets between $10 billion and $100 billion

Current wording

(2)CRE peer information based on June 30, 2025 Call Report data for banks with total assets between $10 billion and $100 billion

Previous wording

Geographic distribution in the tables above is based on location of the underlying collateral property. LTVs and DSCRs are based on the most recent available information; if current appraisals are not available, LTVs are adjusted by our models based on current and forecasted sub-market dynamics. DSCRs are calculated based on current contractually required payments, which in some cases may be interest only and on current levels of operating cash flows. DSCR calculations do not include pro-forma rental payments on in-place leases that are currently in initial rent abatement periods.

Current wording

Geographic distribution in the tables above is based on location of the underlying collateral property. LTVs and DSCRs are based on the most recent available information; if current appraisals are not available, LTVs are adjusted by our models based on current and forecasted sub-market dynamics. DSCRs are calculated based on current contractually required payments, which in some cases may be interest only and on current levels of operating cash flows. DSCR calculations do not include secondary forms of repayment or pro-forma rental payments on in-place leases that are currently in initial rent abatement periods.

Previous wording

Included in New York tri-state multifamily loans in the tables above is approximately $110 million of rent regulated exposure as of June 30, 2025.

Current wording

Included in New York tri-state multifamily loans in the tables above is approximately $107 million of rent regulated exposure as of September 30, 2025.

Previous wording

The following table presents information about CRE loans maturing in the next 12 months by property type at June 30, 2025 (dollars in thousands). 16% of the total CRE portfolio, with a weighted average coupon rate of 4.34%, is fixed rate to the borrower and maturing in the next 12 months.

Current wording

The following table presents information about CRE loans maturing in the next 12 months by property type at September 30, 2025 (dollars in thousands). Sixteen percent of the total CRE portfolio, with a weighted average coupon rate of 4.41%, is fixed rate to the borrower and maturing in the next 12 months.

Previous wording

The office segment totaled $1.6 billion at June 30, 2025. Medical office comprised approximately $337 million or 20% of the total office portfolio. The following charts present the sub-market geographic distribution of the Florida and NY tri-state office portfolios at June 30, 2025:

Current wording

The office segment totaled $1.5 billion at September 30, 2025, a decline of $122 million for the quarter. Medical office comprised approximately $292 million or 19% of the total office portfolio. The following charts present the sub-market geographic distribution of the Florida and NY tri-state office portfolios at September 30, 2025:

Previous wording

The New York tri-state market encompasses approximately 22% of the office segment, with $133 million of exposure in Manhattan. As of June 30, 2025, the Manhattan office portfolio was approximately 96% occupied with 6% rent rollover expected in the next 12 months. The Florida office portfolio is predominantly suburban.

Current wording

The New York tri-state market encompasses approximately 18% of the office segment, with $85 million of exposure in Manhattan. As of September 30, 2025, the Manhattan office portfolio was approximately 98% occupied with 9% rent rollover expected in the next 12 months. The Florida office portfolio is predominantly suburban.

Previous wording

Office loans not secured by properties in Florida or the New York tri-state area comprised 19%, or approximately $315 million of the segment, and exhibited no particular geographic concentration. Estimated rent rollover of the total office portfolio in the next 12 months is approximately 9%; 10% for Florida and 7% for the New York tri-state area.

Current wording

Office loans not secured by properties in Florida or the New York tri-state area comprised 21%, or approximately $314 million of the segment, and exhibited no particular geographic concentration. Estimated rent rollover of the total office portfolio in the next 12 months is approximately 12%; 14% for Florida and 10% for the New York tri-state area.

Previous wording

The construction portfolio includes an additional $88 million in office related exposure, $84 million of which is in New York.

Current wording

The construction portfolio includes an additional $87 million in office related exposure, $83 million of which is in New York.

Previous wording

Non-performing CRE loans, excluding SBA loans, totaled $142 million at June 30, 2025 and included $124 million of office exposure at June 30, 2025. Also see the section entitled "Asset Quality" below.

Current wording

Non-performing CRE loans, excluding SBA loans, totaled $136 million at September 30, 2025 and included $119 million of office exposure. Also see the section entitled "Asset Quality" below.