Management’s discussion and analysis (“MD&A”) of earnings and related financial data is presented to assist in understanding the financial condition and results of operations of First Citizens BancShares, Inc. (the “Parent Company” and, when including all of its subsidiaries on a consolidated basis, “we,” “us,” “our,” or “BancShares”) and its banking subsidiary, First-Citizens Bank & Trust Company (“FCB”). Unless otherwise noted, the terms “we,” “us,” “our,” and “BancShares” in this section refer to the consolidated financial position and consolidated results of operations for BancShares. This MD&A is expected to provide our investors with a view of our financial condition and results of operations from our management’s perspective. This MD&A should be read in conjunction with the unaudited consolidated financial statements and related notes presented within this Quarterly Report on Form 10-Q (this “Form 10-Q”), along with our consolidated financial statements and related MD&A of financial condition and results of operations included in our Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Form 10-K”). Throughout this MD&A, references to a specific “Note” refer to Notes to the Consolidated Financial Statements (Unaudited) in Item 1. Financial Statements. Intercompany accounts and transactions have been eliminated. Refer to Note 1—Significant Accounting Policies and Basis of Presentation for further information. Management uses certain financial measures that are not presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”) in its analysis of the financial condition and results of operations of BancShares. Refer to the "Non-GAAP Financial Measurements" section of this MD&A for a reconciliation of these financial measures to the most directly comparable financial measures in accordance with GAAP. EXECUTIVE OVERVIEW The Parent Company is a bank holding company (“BHC”) and financial holding company. The Parent Company is regulated by the Board of Governors of the Federal Reserve System (“Federal Reserve”) under the U.S. Bank Holding Company Act of 1956, as amended. The Parent Company is also registered under the BHC laws of North Carolina and is subject to supervision, regulation and examination by the North Carolina Office of the Commissioner of Banks (the “NCCOB”). BancShares conducts its banking operations through its wholly owned subsidiary, FCB, a state-chartered bank organized under the laws of the state of North Carolina. FCB is regulated by the NCCOB. In addition, FCB, as an insured depository institution, is supervised by the Federal Deposit Insurance Corporation (the “FDIC”). BancShares provides financial services for a wide range of consumer and commercial clients. BancShares offers deposit products, loans, and wealth management and private banking services to consumer clients. BancShares provides lending, leasing, capital markets and other financial and advisory services, to small and middle-market companies across a variety of industries. Additionally, BancShares provides a full suite of financial products and services to private equity firms, venture capital firms, and commercial clients in innovation markets, such as technology, life sciences and healthcare industries. BancShares also provides deposit, cash management and lending to homeowner associations and property management companies and owns a fleet of railcars and locomotives that are leased to railroads and shippers. BancShares delivers banking products and services to its customers through an extensive branch network and additionally operates a nationwide digital banking platform that delivers deposit products to consumers (the “Direct Bank”). Services offered at most branches include accepting deposits, cashing checks and providing for consumer and commercial cash needs. Consumer and business customers may also conduct banking transactions through various digital channels. In addition to our banking operations, we provide various investment products and services through FCB’s wholly owned subsidiaries, including First Citizens Investor Services, Inc. (“FCIS”), First Citizens Asset Management, Inc. (“FCAM”), and First Citizens Delaware Trust Company, and a non-bank subsidiary, First Citizens Capital Securities, LLC (“FCCS”). As a registered broker-dealer, FCIS provides a full range of investment products, including annuities, brokerage services and third-party mutual funds. As registered investment advisers, FCIS and FCAM provide investment management services and advice. FCCS is a broker-dealer that also provides underwriting and private placement services. We also have other wholly owned subsidiaries, including SVB Wealth LLC, SVB Asset Management, and First Citizens Institutional Asset Management, LLC, which are active investment advisers. Refer to Note 18—Segment Information for further information regarding the products and services we provide. Refer to the 2025 Form 10-K for a discussion of our strategy. 56 Recent Events Equity Transactions Share Repurchase Programs During the second quarter of 2026, we repurchased 298,907 shares of our Class A common stock for $600 million and paid a dividend of $2.10 per share on our Class A and Class B common stock. Shares repurchased during the second quarter of 2026 represented 2.80% of Class A common stock and 2.56% of total Class A and Class B common stock outstanding at March 31, 2026. From inception of the 2024 share repurchase program (“2024 SRP”) through June 30, 2026, we repurchased 3,141,855 shares of our Class A common stock for $6.19 billion, representing 23.23% of Class A common stock and 21.62% of total Class A and Class B common stock outstanding as of June 30, 2024. From July 1, 2026 through July 31, 2026, BancShares repurchased an additional 97,287 shares of Class A common stock for a total of $206 million and had total capacity remaining under the current share repurchase program (the “2025 SRP”) of $1.11 billion as of July 31, 2026. Refer to Part II, Item 2. Unregistered Sales of Equity Securities and Use of Proceeds for second quarter 2026 monthly repurchase activity of Class A common stock. Preferred Stock Issuance On February 5, 2026, the Parent Company issued and sold 6.625% non-cumulative perpetual preferred stock, series E for a total of $400 million. Refer to Note 13—Stockholders' Equity for further information, including depositary shares and liquidation preference. Debt Transactions Prepayments of the Purchase Money Note In connection with the SVBB Acquisition (as defined in Note 2—Business Combinations), FCB issued a five-year $36.07 billion note payable to the FDIC, maturing March 27, 2028 (the “Purchase Money Note”). The Purchase Money Note had a carrying value of $28.42 billion and $33.39 billion at June 30, 2026 and December 31, 2025, respectively. During the current quarter, we prepaid $2.50 billion of the Purchase Money Note which resulted in a $7 million loss on extinguishment of debt. During the six months ended June 30, 2026, we prepaid $5.00 billion of the Purchase Money Note which resulted in a $15 million loss on extinguishment of debt. The outstanding balance of the Purchase Money Note declined from $35.85 billion at September 30, 2025 to $28.42 billion at June 30, 2026. Additionally, we prepaid $1.00 billion in July 2026. We will continue to monitor the interest rate environment, FCB’s collateral position for the Purchase Money Note, and FCB’s liquidity position to determine the timing and magnitude of further voluntary prepayments. We expect monthly prepayments to be at least $500 million throughout 2026. In the third quarter of 2026, we expect total prepayments of $6 billion to $8 billion, largely driven by expected liquidity from the BMO Branch Acquisition (as defined in Note 2—Business Combinations). Debt Issuances Debt issuances through June 30, 2026 of $1.25 billion include the following: •On June 24, 2026, FCB issued and sold $750 million aggregate principal amount of its 5.097% Fixed-to-Floating Rate Senior Notes due in 2029 (the “Current Quarter Debt Issuance”). •On March 3, 2026, the Parent Company issued and sold $500 million aggregate principal amount of its 4.869% Fixed-to-Floating Rate Senior Notes due in 2032 in a public offering. On August 3, 2026, FCB issued and sold an additional $400 million aggregate principal amount of its 5.097% Fixed-to-Floating Rate Senior Notes due in 2029. SBA Securitization On June 29, 2026, we completed the SBA Securitization (as defined in Note 9—Variable Interest Entities) of SBA commercial loans held for sale totaling $363 million in amortized cost, resulting in a gain of $3 million. Loan Sale In April 2026, residential mortgage loans held for sale totaling $644 million in amortized cost were sold and we recognized a gain of $1 million as further discussed in Note 4—Assets Held for Sale. Sale of Tax Credit Investments In May 2026, we sold $161 million of tax credit investments and recognized a pretax gain of $17 million. Refer to Note 9—Variable Interest Entities for further discussion. 57 Pending Branch Acquisition On October 16, 2025, FCB announced the BMO Branch Acquisition to acquire 138 branches from BMO Bank N.A. located throughout the Midwest, Great Plains and West regions of the U.S. We expect to assume approximately $5.3 billion in deposits and acquire approximately $700 million in loans. We expect the transaction to be completed during the third quarter of 2026. Commercial Banking Brand Alignment On April 23, 2026, FCB announced plans to expand its commercial banking capabilities and align brand names in the fourth quarter of 2026. Silicon Valley Bank (“SVB”), a division of FCB, will rebrand as First Citizens Innovation Banking and First Citizens Fund Banking. CIT Commercial Services and the Silicon Valley Bank Wine division will rebrand as FCB. Recent Economic, Industry and Regulatory Developments Economic conditions reflected heightened uncertainty in 2026, as inflationary pressures, due in part to global energy constraints related to the conflicts in the Middle East, contributed to market volatility. We continue to monitor these developments and the broader macroeconomic environment; however, the ultimate effects remain uncertain and dependent on future events. Entering 2026, the benchmark federal funds range was between 3.50% - 3.75%. During the 2026 Federal Open Market Committee meetings through July, the benchmark federal funds rate was left unchanged. The U.S. government announced changes to its trade policies in 2025 and significantly increased tariffs on certain imports under emergency authorities, including the International Emergency Economic Powers Act (the “IEEPA”). In February 2026, the Supreme Court ruled that the IEEPA does not authorize the President to impose tariffs. The current tariff environment remains dynamic and uncertain, including with respect to replacement measures under other legal authorities. We continue to closely monitor both the impact and potential impact of such measures on our business, our customers and on overall economic conditions in the United States. On March 19, 2026, federal banking regulators issued revised notices of proposed rulemaking to implement the final components of the Basel III accords (the “Basel III proposals”). The proposals include revisions and streamlining of the expanded risk-based approach (the “ERBA”). The proposals require the ERBA for Category I and Category II firms and allow all other banking organizations, including Category III and Category IV firms, to elect the ERBA. The proposals include a revised standardized approach for calculating risk-weighted assets applicable to all other banking organizations, including Category III and Category IV firms, that do not elect the ERBA. These proposals are expected to decrease risk-weighted assets in aggregate for the banking industry. The proposals also require Category III and Category IV firms to recognize most aspects of accumulated other comprehensive income (“AOCI”) in regulatory capital. The comment period closed on June 18, 2026. We will continue to monitor further developments regarding the proposals and assess potential impacts to our regulatory capital requirements, including enhanced capital flexibility. Financial Performance Summary The following tables in this MD&A include financial data for the three months ended June 30, 2026 (the “current quarter”), March 31, 2026 (the “linked quarter”) and June 30, 2025 (the “prior year quarter”), along with the six months ended June 30, 2026 (“current YTD”), and the six months ended June 30, 2025 (“prior YTD”). In accordance with Item 303(c) of Regulation S-K, we focus our discussion of quarterly results of operations on changes compared to the linked quarter for the narrative discussion and analysis as we believe this provides investors and other users of our data with the most relevant information. We focus the discussion of our financial position by comparing balances as of June 30, 2026 to December 31, 2025, however the tables also provide linked quarter balances. Percent changes within this MD&A are based on unrounded amounts and may not recalculate precisely using the displayed rounded amounts. 58 Table 1 Selected Financial Data dollars in millions, except share data Three Months Ended Six Months Ended June 30, June 30, 2026 March 31, 2026 June 30, 2025 2026 2025 Results of Operations: Interest income $ 2,851 $ 2,786 $ 2,945 $ 5,637 $ 5,840 Interest expense 1,195 1,165 1,250 2,360 2,482 Net interest income 1,656 1,621 1,695 3,277 3,358 (Benefit) provision for credit losses (10) 72 115 62 269 Net interest income after provision for credit losses 1,666 1,549 1,580 3,215 3,089 Noninterest income 776 692 678 1,468 1,313 Noninterest expense 1,551 1,536 1,500 3,087 2,993 Income before income taxes 891 705 758 1,596 1,409 Income tax expense 219 171 183 390 351 Net income 672 534 575 1,206 1,058 Preferred stock dividends 32 26 14 58 29 Net income available to common stockholders $ 640 $ 508 $ 561 $ 1,148 $ 1,029 Per Common Share Information: Weighted average common shares outstanding (diluted) 11,535,792 11,924,899 13,237,226 11,729,271 13,405,295 Diluted earnings per common share $ 55.52 $ 42.63 $ 42.36 $ 97.95 $ 76.73 Key Performance Metrics: Return on average assets 1.15 % 0.93 % 1.01 % 1.04 % 0.94 % Net interest margin (1) 3.10 3.09 3.26 3.09 3.26 Net interest margin, excluding purchase accounting accretion or amortization (1) (2) 3.01 3.01 3.14 3.01 3.13 Select Average Balances: Investment securities $ 42,891 $ 41,757 $ 43,935 $ 42,327 $ 43,746 Total loans and leases (3) 150,602 149,890 141,952 150,249 141,420 Operating lease equipment, net 9,728 9,660 9,419 9,694 9,385 Total assets 235,200 233,181 227,552 234,197 226,506 Total deposits 170,639 165,927 157,664 168,296 157,024 Total borrowings 33,229 35,334 38,379 34,276 37,892 Total stockholders’ equity 22,180 22,487 22,488 22,332 22,472 As of the Period Ending June 30, 2026 March 31, 2026 June 30, 2025 December 31, 2025 Select Ending Balances: Investment securities $ 43,557 $ 42,986 $ 43,346 $ 41,564 Total loans and leases 151,034 148,692 141,269 147,930 Operating lease equipment, net 9,755 9,685 9,466 9,621 Total assets 236,842 235,959 229,653 229,698 Total deposits 173,427 170,842 159,935 161,578 Total borrowings 32,188 33,962 38,112 36,008 Total stockholders’ equity 21,900 22,048 22,296 22,238 Loan to deposit ratio 87.09 % 87.04 % 88.33 % 91.55 % Noninterest-bearing deposits to total deposits 24.49 25.52 25.56 25.16 Capital Ratios: Total risk-based capital 13.37 % 13.51 % 14.25 % 13.71 % Tier 1 risk-based capital 11.73 11.79 12.63 11.91 Common equity Tier 1 10.77 10.83 12.12 11.15 Tier 1 leverage 9.22 9.30 9.62 9.29 Select Asset Quality Metrics: Ratio of nonaccrual loans to total loans 0.96 % 0.96 % 0.93 % 0.88 % Allowance for loan and lease losses to loans ratio 0.98 1.05 1.18 1.06 (1) Calculated net of average credit balances of factoring clients to appropriately reflect the interest-earning portion of factoring receivables. (2) Net interest margin (“NIM”), excluding purchase accounting accretion or amortization (“PAA”), is a non-GAAP financial measure. Refer to the “Net Interest Income (“NII”), NIM, and Interest Income on Loans and Leases, Excluding PAA” discussion in the “Non-GAAP Financial Measurements” section of this MD&A for a reconciliation from the most comparable GAAP measure to the non-GAAP measure. (3) Average loan balances include loans held for sale and nonaccrual loans. 59 Financial highlights are summarized below. Further details are discussed in the “Results of Operations” and “Balance Sheet Analysis” sections of this MD&A. Current Quarter Income Statement Highlights (Current Quarter Compared to Linked Quarter) •Net income for the current quarter was $672 million, an increase of $138 million or 26% from $534 million for the linked quarter. Net income available to common stockholders for the current quarter was $640 million, an increase of $132 million or 26% from $508 million for the linked quarter. Earnings per basic and diluted common share for the current quarter were $55.52, increases from $42.63 for the linked quarter. The increases in net income and net income available to common stockholders were due to lower provision for credit losses and higher noninterest income and NII, partially offset by higher noninterest expense and income tax expense, as discussed below. •NII for the current quarter was $1.66 billion, an increase of $35 million or 2% from $1.62 billion for the linked quarter. NIM was 3.10% for the current quarter, an increase of 1 basis point (“bp”) from 3.09% for the linked quarter. The increases in NII and NIM were mainly due to higher yields on and average balances of loans and investment securities, and a decline in the average balance of borrowings as we repaid an additional $2.50 billion of the Purchase Money Note, partially offset by a higher average balance of and rate paid on interest-bearing deposits. ◦PAA for the current quarter was $48 million, an increase of $9 million from $39 million for the linked quarter. NIM, excluding PAA(1) was 3.01% for the current and linked quarters. •Noninterest income for the current quarter was $776 million, an increase of $84 million or 12% from $692 million for the linked quarter, largely due to an increase in other noninterest income of $50 million, mainly attributable to a $27 million increase in the fair value of equity warrants and a $17 million gain on sale of tax credit investments, and increases of $12 million in the fair value of marketable equity securities, $6 million in client investment fees, $4 million in deposit fees and service charges, and $4 million in lending-related fees. •Noninterest expense for the current quarter was $1.55 billion, an increase of $15 million or 1% from $1.54 billion for the linked quarter, mainly due to increases of $15 million in marketing expense, $8 million in other noninterest expense, $7 million in third-party processing fees and $5 million in equipment expense, partially offset by a decrease in personnel cost of $25 million. •Benefit for credit losses was $10 million for the current quarter, compared to a provision for credit losses of $72 million for the linked quarter. The current quarter included a provision for loan and lease losses of $34 million that was more than offset by a benefit for off-balance sheet credit exposure of $44 million. ◦The provision for loan and lease losses for the current quarter was $34 million, compared to $103 million for the linked quarter. The $69 million decrease was mainly attributable to the impact of a $74 million reserve release in the current quarter compared to an $8 million reserve release in the linked quarter, as well as a decline of $3 million in net charge-offs. ▪The $74 million allowance for loan and lease losses (“ALLL”) reserve release in the current quarter was largely driven by lower specific reserves, improvements in credit quality including updates to certain models used to estimate the allowance as further discussed in the “Risk Management—Credit Risk—ALLL Methodology” section of this MD&A, changes in the macroeconomic scenarios, and growth concentrated in capital call lines which have a significantly lower loss rate relative to our other loan portfolios. ▪The $8 million reserve release in the linked quarter was driven by loan growth concentrated in capital call lines and changes in the macroeconomic scenarios, partially offset by higher reserves for individually evaluated loans. ◦The benefit for off-balance sheet credit exposure was $44 million, an increase of $12 million from $32 million for the linked quarter, primarily due to the model updates discussed above and changes in the macroeconomic scenarios. •Income tax expense for the current quarter was $219 million, an increase of $48 million from $171 million for the linked quarter, largely due to higher income before income taxes. •Return on average assets for the current quarter was 1.15%, an increase of 22 bps from 0.93% for the linked quarter due to the increase in net income explained above. (1) NIM, excluding PAA is a non-GAAP measure. Refer to the “NII, NIM, and Interest Income on Loans and Leases, Excluding PAA” discussion in the “Non-GAAP Financial Measurements” section of this MD&A for further discussion. 60 YTD Income Statement Highlights (Current YTD Compared to Prior YTD) •Net income for the current YTD was $1.21 billion, an increase of $148 million or 14% from $1.06 billion for the prior YTD. Net income available to common stockholders for the current YTD was $1.15 billion, an increase of $119 million or 12% from $1.03 billion for the prior YTD. Earnings per basic and diluted common share for the current YTD were $97.95, increases from $76.73 for the prior YTD. The increases in net income and net income available to common stockholders were due to lower provision for credit losses and higher noninterest income, partially offset by lower NII and higher noninterest expense, as further discussed below. •NII for the current YTD was $3.28 billion, a decrease of $81 million or 2% from $3.36 billion for the prior YTD. NIM was 3.09% for the current YTD and 3.26% for the prior YTD, a decrease of 17 bps. The decreases in NII and NIM were mainly due to a lower yield on loans, lower yields on and average balances of interest-earning deposits at banks and investment securities, lower PAA, and a higher average balance of interest-bearing deposits, partially offset by the impacts of a higher average balance of loans, a decline in the rate paid on interest-bearing deposits, and a decline in the average balance of borrowings due to continued prepayments on the Purchase Money Note. ◦PAA for the current YTD was $87 million, a decrease of $55 million from $142 million for the prior YTD. NIM, excluding PAA(1) was 3.01% for the current YTD, a decrease of 12 bps from 3.13% for the prior YTD. •Noninterest income for the current YTD was $1.47 billion, an increase of $155 million or 12% from $1.31 billion for the prior YTD, largely due to increases in other noninterest income of $70 million, deposit fees and service charges of $27 million, a favorable change of $21 million in the fair value of marketable equity securities, along with higher rental income on operating lease equipment of $19 million, and increases of $12 million in the gain on sale of leasing equipment and $10 million in wealth management services. •Noninterest expense for the current YTD was $3.09 billion, an increase of $94 million or 3% from $2.99 billion for the prior YTD, mainly due to increases in personnel cost of $85 million, third-party processing fees of $67 million, maintenance and other operating lease expenses of $19 million, marketing expense of $11 million, and equipment expense of $10 million, partially offset by decreases in acquisition-related expenses of $67 million and other noninterest expense of $27 million. •Provision for credit losses for the current YTD was $62 million, a decrease of $207 million or 77% from $269 million for the prior YTD. The current YTD included a provision for loan and lease losses of $137 million, partially offset by a benefit for off-balance sheet credit exposure of $76 million. ◦The provision for loan and lease losses for the current YTD was $137 million compared to $259 million for the prior YTD. The $122 million decrease was mainly due to an $82 million ALLL reserve release in the current YTD compared to $4 million in the prior YTD and a decline in net charge-offs of $44 million. ▪The $82 million ALLL reserve release for the current YTD is discussed above as the “Current Quarter Income Statement Highlights” section of this MD&A summarizes the ALLL reserve releases of $74 million and $8 million for the current and linked quarters, respectively. ◦The benefit for off-balance sheet credit exposure for the current YTD was $76 million compared to a provision for the prior YTD of $10 million, resulting in a decrease in provision of $86 million, primarily due to the model updates discussed above in the “Current Quarter Income Statement Highlights” section of this MD&A and changes in the macroeconomic scenarios. •Income tax expense for the current YTD was $390 million, an increase of $39 million from $351 million for the prior YTD, largely due to higher income before income taxes. •Return on average assets for the current YTD was 1.04%, an increase of 10 bps from 0.94% for the prior YTD due to the increase in net income explained above. (1) NIM, excluding PAA is a non-GAAP measure. Refer to the “NII, NIM, and Interest Income on Loans and Leases, Excluding PAA” discussion in the “Non-GAAP Financial Measurements” section of this MD&A for further discussion. 61 Balance Sheet Highlights •Loans and leases at June 30, 2026 were $151.03 billion, an increase of $3.10 billion or 2% from $147.93 billion at December 31, 2025. Commercial Bank segment loan growth of $3.73 billion, mainly concentrated in Global Fund Banking, was partially offset by a decrease in General Bank segment loans of $603 million, largely due to the $363 million in amortized cost of SBA commercial loans sold in the SBA Securitization. •Investment securities at June 30, 2026 were $43.56 billion, an increase of $1.99 billion or 5% from $41.56 billion at December 31, 2025, as purchases of available for sale U.S. treasury securities were partially offset by maturities and paydowns. •Deposits at June 30, 2026 were $173.43 billion, an increase of $11.85 billion or 7% from $161.58 billion at December 31, 2025. As shown in Table 2 and discussed below, the increase from December 31, 2025 was attributable to deposit growth in Corporate of $6.77 billion primarily due to the Direct Bank and brokered deposits, the Commercial Bank segment of $4.16 billion, and the General Bank segment of $922 million. Noninterest-bearing deposits grew by $1.82 billion or 5% compared to December 31, 2025, and represented 24.5% of total deposits as of June 30, 2026, compared to 25.2% at December 31, 2025. •Borrowings at June 30, 2026 were $32.19 billion, a decrease of $3.82 billion or 11% from $36.01 billion at December 31, 2025. The decrease was primarily due to prepayments of $5.00 billion on the Purchase Money Note, partially offset by debt issuances of $1.25 billion. •The ALLL was $1.48 billion at June 30, 2026, compared to $1.57 billion at December 31, 2025, resulting in an ALLL reserve release of $82 million for the current YTD as further discussed above in the “YTD Income Statement Highlights” section of this MD&A. The ALLL as a percentage of loans was 0.98% at June 30, 2026, a decrease of 8 bps from 1.06% at December 31, 2025. •Interest-earning deposits at banks were $21.13 billion at June 30, 2026, an increase of $1.33 billion compared to $19.80 billion at December 31, 2025, a function of the balance sheet trends discussed above. •At June 30, 2026, BancShares remained well capitalized with a total risk-based capital ratio of 13.37%, a Tier 1 risk-based capital ratio of 11.73%, a Common Equity Tier 1 (“CET1”) ratio of 10.77% and a Tier 1 leverage ratio of 9.22%. Funding, Liquidity and Capital Overview Deposit Composition and Trends We primarily fund our business through deposits. Deposits represented 84% of total funding at June 30, 2026. Table 2 Deposit Trends dollars in millions Deposit Balance June 30, 2026 March 31, 2026 December 31, 2025 General Bank segment $ 75,718 $ 75,914 $ 74,796 Commercial Bank segment 45,690 47,191 41,532 Corporate and Rail segment 52,019 47,737 45,250 Total deposits $ 173,427 $ 170,842 $ 161,578 Deposit trends for the segments and Corporate at June 30, 2026 compared to December 31, 2025 are discussed below: •Corporate deposit growth of $6.77 billion was primarily due to Direct Bank and brokered deposit growth of $3.42 billion and $3.32 billion, respectively. We utilized brokered deposits more prevalently in 2026 as rates were favorable relative to Direct Bank deposits. We will continue to monitor the rate environments for brokered and Direct Bank deposits to determine the target growth for these deposit channels. •Commercial Bank segment deposit growth of $4.16 billion was mainly in Global Fund Banking and Tech and Healthcare lines of business. Most of the growth was in noninterest-bearing deposits and interest-bearing checking. •General Bank segment deposit growth of $922 million was primarily concentrated in our Branch Network. Deposit growth was mostly in time deposits and noninterest-bearing deposits. Refer to the “Results by Segment” for further discussion of changes in deposits at June 30, 2026 compared to March 31, 2026. Total uninsured deposits were $65.06 billion or 38% of total deposits at June 30, 2026 and $61.81 billion or 38% at December 31, 2025. 62 Refer to the “Balance Sheet Analysis—Interest-bearing Liabilities—Deposits” section of this MD&A for further discussion of deposits. Liquidity Position We strive to maintain a strong liquidity position and our risk appetite for liquidity is low. At June 30, 2026, we had $59.14 billion in high-quality liquid assets consisting of $20.18 billion in cash and interest-earning deposits at banks (primarily held at the Federal Reserve Bank (“FRB”)) and $38.96 billion in high-quality liquid securities (“HQLS”), mainly comprised of U.S. agency mortgage-backed and U.S. Treasury investment securities. Additionally, we have unused borrowing capacity with the Federal Home Loan Bank (“FHLB”) and FRB of $17.75 billion and $12.77 billion, respectively. Refer to the “Risk Management—Liquidity Risk” section of this MD&A for further discussion. In connection with the SVBB Acquisition, FCB issued a five-year, 3.50% fixed rate Purchase Money Note, which had a carrying value of $28.42 billion at June 30, 2026. While scheduled principal payments are not required until maturity in March 2028, FCB may voluntarily prepay principal without a premium or penalty. FCB prepaid $2.50 billion of the Purchase Money Note during the current quarter ($5.00 billion during the current YTD), and previously prepaid $2.49 billion in December 2025, which reduced the outstanding balance from $35.85 billion at September 30, 2025 to $28.42 billion at June 30, 2026. Additionally, we prepaid $1.00 billion in July 2026. We will continue to monitor the interest rate environment, FCB’s collateral position for the Purchase Money Note, and FCB’s liquidity position to determine the timing and magnitude of further voluntary prepayments. We expect monthly prepayments to be at least $500 million throughout 2026. In the third quarter of 2026, we expect total prepayments of $6 billion to $8 billion, largely driven by expected liquidity from the BMO Branch Acquisition. Potential sources that could fund voluntary prepayments or the amount due at maturity include excess liquidity (primarily comprised of interest-earning deposits at banks and proceeds from maturities and paydowns of investment securities), deposit growth including brokered deposits and deposits to be assumed in the BMO Branch Acquisition, loan sales or securitizations, FHLB advances, and issuance of perpetual preferred stock, unsecured debt or other borrowings. Investment Securities Duration At June 30, 2026, our investment securities portfolio primarily consisted of debt securities available for sale and held to maturity as summarized below. We manage debt security market risk by monitoring the average duration of our investment securities portfolio. The duration of our investment securities was 2.6 years at June 30, 2026. The investment securities available for sale portfolio had an average duration of 2.3 years and the held to maturity portfolio had an average duration of 3.9 years. Refer to the “Balance Sheet Analysis—Interest-earning Assets—Investment Securities” section of this MD&A and Note 3—Investment Securities for further information. Table 3 Investment Securities Summary dollars in millions June 30, 2026 Composition (1) Amortized Cost Fair Value Fair Value to Amortized Cost Total investment securities available for sale 80.2 % $ 34,510 $ 33,983 98.5 % Total investment securities held to maturity 19.4 9,418 8,214 87.2 Investment in marketable equity securities 0.4 95 156 164.5 Total investment securities 100.0 % $ 44,023 $ 42,353 (1) Calculated as a percentage of the total fair value of investment securities. Capital Position At June 30, 2026, all regulatory capital ratios for BancShares and FCB exceeded the prompt corrective action (“PCA”) thresholds, well capitalized thresholds, and Basel III requirements established by the federal banking agencies as further discussed in the “Capital” section of this MD&A. 63 RESULTS OF OPERATIONS Net Interest Income and Net Interest Margin NII is affected by changes in interest rates and changes in the amount and composition of interest-earning assets and interest-bearing liabilities. Interest income and expense and the respective yields and rates include amortization of premiums, accretion of discounts, and impacts from hedging activities. The following tables present the average balances of interest-earning assets and interest-bearing liabilities with the associated yields and rates, interest income and expense, and changes therein due to changes in volume and yields or rates. Changes in interest income and expense due to changes in (i) volume (average balances of interest-earning assets and interest-bearing liabilities) and (ii) yields or rates are based on the following: •The change in NII due to volume is calculated as the change in average balance multiplied by the yield or rate from the prior period. •The change in NII due to yield or rate is calculated as the change in yield or rate multiplied by the average balance from the prior period. •The change in NII due to changes in both volume and yield or rate (i.e., portfolio mix) is calculated as the change in rate multiplied by the change in volume. This component is allocated between the changes due to volume and yield or rate based on the ratio each component bears to the absolute dollar amounts of their total. •Tax equivalent NII was not materially different from NII, therefore we present NII in our analysis. 64 Table 4 Average Balances, Yields and Rates, NII, and NIM (Current Quarter Compared to Linked Quarter) dollars in millions Average Balance Yield / Rate Interest Income / Expense Three Months Ended Increase (Decrease) Three Months Ended Three Months Ended Increase (Decrease) due to: Jun 30, 2026 Mar 31, 2026 Jun 30, 2026 Mar 31, 2026 Increase (Decrease) bps Jun 30, 2026 Mar 31, 2026 Increase (Decrease) Volume(1) Yield /Rate(1) Loans and leases (1) (2) $ 149,275 $ 148,666 $ 609 0.4 % 6.05 % 6.01 % 4 $ 2,253 $ 2,206 $ 47 $ 16 $ 31 Investment securities 42,891 41,757 1,134 2.7 3.72 3.67 5 398 382 16 11 5 Securities purchased under agreements to resell 323 305 18 5.7 3.60 3.65 (5) 3 2 1 1 — Interest-earning deposits at banks 21,501 21,824 (323) (1.5) 3.67 3.64 3 197 196 1 (2) 3 Total interest-earning assets (2) $ 213,990 $ 212,552 $ 1,438 0.7 5.34 5.30 4 $ 2,851 $ 2,786 $ 65 $ 26 $ 39 Noninterest-earning assets 21,210 20,629 581 2.8 Total assets $ 235,200 $ 233,181 $ 2,019 0.9 Interest-bearing deposits Checking with interest $ 26,146 $ 25,341 $ 805 3.2 % 1.60 % 1.52 % 8 $ 104 $ 95 $ 9 $ 3 $ 6 Money market 40,889 41,196 (307) (0.7) 2.35 2.38 (3) 240 242 (2) (1) (1) Savings 48,357 46,720 1,637 3.5 3.48 3.46 2 420 398 22 18 4 Time deposits 13,993 11,946 2,047 17.1 3.36 3.31 5 117 98 19 18 1 Total interest-bearing deposits 129,385 125,203 4,182 3.3 2.73 2.70 3 881 833 48 38 10 Borrowings: Short-term borrowings 162 197 (35) (17.6) 0.35 0.37 (2) — — — — — Senior unsecured borrowings 1,136 718 418 58.2 5.13 5.23 (10) 14 10 4 4 — Subordinated debt 1,755 1,771 (16) (0.9) 5.27 5.28 (1) 24 23 1 1 — Other borrowings 30,176 32,648 (2,472) (7.6) 3.66 3.66 — 276 299 (23) (23) — Long-term borrowings 33,067 35,137 (2,070) (5.9) 3.80 3.78 2 314 332 (18) (18) — Total borrowings 33,229 35,334 (2,105) (6.0) 3.78 3.76 2 314 332 (18) (18) — Total interest-bearing liabilities $ 162,614 $ 160,537 $ 2,077 1.3 % 2.95 2.93 2 $ 1,195 $ 1,165 $ 30 $ 20 $ 10 Noninterest-bearing liabilities $ 50,406 $ 50,157 $ 249 0.5 % Stockholders' equity 22,180 22,487 (307) (1.4) Total liabilities and stockholders’ equity $ 235,200 $ 233,181 $ 2,019 0.9 Net interest spread (2) 2.39 % 2.37 % 2 Net interest margin and net interest income (2) 3.10 % 3.09 % 1 $ 1,656 $ 1,621 $ 35 (1) Loans and leases include nonaccrual loans and loans held for sale. Interest income on loans and leases includes accretion income and loan fees. (2) The average balances and yields for loans and leases are calculated net of average credit balances of factoring clients to appropriately reflect the interest-earning portion of factoring receivables. 65 NII and NIM (Current Quarter Compared to Linked Quarter) The table above quantifies the increases or decreases for the current quarter compared to the linked quarter for NII and NIM, as well as average balances of interest-earning assets and interest-bearing liabilities, and the respective yields earned and rates paid. The main reasons for the increases and decreases are explained below: •NII for the current quarter was $1.66 billion, an increase of $35 million or 2% from $1.62 billion for the linked quarter. NII, excluding PAA,(1) was $1.61 billion for the current quarter, an increase of $26 million, from $1.58 billion for the linked quarter. The main reasons for the increases in NII and NII, excluding PAA,(1) are explained below: ◦Interest income on loans and leases for the current quarter was $2.25 billion, an increase of $47 million or 2% from $2.21 billion for the linked quarter, mainly due to a higher yield, a higher average balance, and higher loan PAA. ▪Interest income on loans and leases, excluding loan PAA,(1) was $2.20 billion for the current quarter, an increase of $40 million or 2% from $2.16 billion for the linked quarter. Loan PAA was $55 million in the current quarter, an increase of $7 million or 16% from $48 million in the linked quarter, mainly a result of accelerated PAA for prepayments of residential mortgage loans. ◦Interest expense on borrowings for the current quarter was $314 million, a decrease of $18 million or 5% from $332 million for the linked quarter, mainly due to a decline in the average balance as we repaid an additional $2.50 billion of the Purchase Money Note, partially offset by the Current Quarter Debt Issuance. ◦Interest income on investment securities (including securities purchased under agreements to resell) for the current quarter was $401 million, an increase of $17 million or 4% from $384 million for the linked quarter, due to a higher yield and a higher average balance. ◦Interest expense on interest-bearing deposits for the current quarter was $881 million, an increase of $48 million or 6% from $833 million for the linked quarter, due to a higher average balance and a higher rate paid. •NIM for the current quarter was 3.10%, an increase of 1 bp from 3.09% for the linked quarter. NIM, excluding PAA,(1) was 3.01% for the current and linked quarters. The modest increase in NIM was mainly due to higher yields on and average balances of loans and investment securities, and a decline in the average balance of borrowings as we repaid an additional $2.5 billion of the Purchase Money Note, partially offset by a higher average balance of and rate paid on interest-bearing deposits. ◦The yield on average interest-earning assets for the current quarter was 5.34%, an increase of 4 bps from 5.30% for the linked quarter, mainly due to higher yields on and average balances of loans and investment securities. ◦The rate paid on average interest-bearing liabilities for the current quarter was 2.95%, an increase of 2 bps from 2.93% for the linked quarter, primarily due to increases in the average balance of and rate paid on interest-bearing deposits, partially offset by the impact of lower average borrowings. (1) Refer to the “NII, NIM, and Interest Income on Loans and Leases, Excluding PAA” discussion in the “Non-GAAP Financial Measurements” section of this MD&A for further information. Refer to the “Executive Overview—Financial Performance Summary—Balance Sheet Highlights,” “Balance Sheet Analysis—Interest-earning Assets,” and “Balance Sheet Analysis—Interest-bearing Liabilities” sections of this MD&A for discussions of balance sheet trends that impact average interest-earning assets, average interest-bearing liabilities, and the related yields and rates paid. 66 Table 5 Average Balances, Yields and Rates, NII, and NIM (Current Quarter Compared to Prior Year Quarter) dollars in millions Average Balance Yield / Rate Interest Income / Expense Three Months Ended Increase (Decrease) Three Months Ended Three Months Ended Increase (Decrease) due to: Jun 30, 2026 Jun 30, 2025 Jun 30, 2026 Jun 30, 2025 Increase (Decrease) bps Jun 30, 2026 Jun 30, 2025 Increase (Decrease) Volume(1) Yield /Rate(1) Loans and leases (1) (2) $ 149,275 $ 140,699 $ 8,576 6.1 % 6.05 % 6.47 % (42) $ 2,253 $ 2,270 $ (17) $ 134 $ (151) Investment securities 42,891 43,935 (1,044) (2.4) 3.72 3.79 (7) 398 416 (18) (10) (8) Securities purchased under agreements to resell 323 237 86 36.2 3.60 4.34 (74) 3 3 — 1 (1) Interest-earning deposits at banks 21,501 23,304 (1,803) (7.8) 3.67 4.40 (73) 197 256 (59) (19) (40) Total interest-earning assets (2) $ 213,990 $ 208,175 $ 5,815 2.8 5.34 5.67 (33) $ 2,851 $ 2,945 $ (94) $ 106 $ (200) Noninterest-earning assets 21,210 19,377 1,833 9.5 Total assets $ 235,200 $ 227,552 $ 7,648 3.4 Interest-bearing deposits Checking with interest $ 26,146 $ 22,929 $ 3,217 14.0 % 1.60 % 1.69 % (9) $ 104 $ 97 $ 7 $ 12 $ (5) Money market 40,889 37,980 2,909 7.7 2.35 2.84 (49) 240 269 (29) 20 (49) Savings 48,357 46,163 2,194 4.8 3.48 3.72 (24) 420 428 (8) 20 (28) Time deposits 13,993 11,510 2,483 21.6 3.36 3.48 (12) 117 100 17 21 (4) Total interest-bearing deposits 129,385 118,582 10,803 9.1 2.73 3.02 (29) 881 894 (13) 73 (86) Borrowings: Short-term borrowings 162 471 (309) (65.5) 0.35 0.57 (22) — — — — — Senior unsecured borrowings 1,136 555 581 104.5 5.13 5.27 (14) 14 8 6 6 — Subordinated debt 1,755 1,473 282 19.2 5.27 5.23 4 24 19 5 5 — Other borrowings 30,176 35,880 (5,704) (15.9) 3.66 3.66 — 276 329 (53) (53) — Long-term borrowings 33,067 37,908 (4,841) (12.8) 3.80 3.74 6 314 356 (42) (42) — Total borrowings 33,229 38,379 (5,150) (13.4) 3.78 3.71 7 314 356 (42) (42) — Total interest-bearing liabilities $ 162,614 $ 156,961 $ 5,653 3.6 % 2.95 3.19 (24) $ 1,195 $ 1,250 $ (55) $ 31 $ (86) Noninterest-bearing liabilities $ 50,406 $ 48,103 $ 2,303 4.8 % Stockholders' equity 22,180 22,488 (308) (1.4) Total liabilities and stockholders’ equity $ 235,200 $ 227,552 $ 7,648 3.4 Net interest spread (2) 2.39 % 2.48 % (9) Net interest margin and net interest income (2) 3.10 % 3.26 % (16) $ 1,656 $ 1,695 $ (39) (1) Loans and leases include nonaccrual loans and loans held for sale. Interest income on loans and leases includes accretion income and loan fees. (2) The average balances and yields for loans and leases are calculated net of average credit balances of factoring clients to appropriately reflect the interest-earning portion of factoring receivables. 67 Table 6 Average Balances, Yields and Rates, NII, and NIM (Current YTD Compared to Prior YTD) dollars in millions Average Balance Yield / Rate Interest Income / Expense Six Months Ended Increase (Decrease) Six Months Ended Six Months Ended Increase (Decrease) due to: Jun 30, 2026 Jun 30, 2025 Jun 30, 2026 Jun 30, 2025 Increase (Decrease) bps Jun 30, 2026 Jun 30, 2025 Increase (Decrease) Volume(1) Yield /Rate(1) Loans and leases (1) (2) $ 148,973 $ 140,099 $ 8,874 6.3 % 6.03 % 6.48 % (45) $ 4,459 $ 4,506 $ (47) $ 276 $ (323) Investment securities 42,327 43,746 (1,419) (3.2) 3.70 3.79 (9) 780 827 (47) (27) (20) Securities purchased under agreements to resell 314 260 54 21.0 3.63 4.36 (73) 5 6 (1) — (1) Interest-earning deposits at banks 21,662 23,003 (1,341) (5.8) 3.65 4.39 (74) 393 501 (108) (27) (81) Total interest-earning assets (2) $ 213,276 $ 207,108 $ 6,168 3.0 5.32 5.67 (35) $ 5,637 $ 5,840 $ (203) $ 222 $ (425) Noninterest-earning assets 20,921 19,398 1,523 7.8 Total assets $ 234,197 $ 226,506 $ 7,691 3.4 Interest-bearing deposits Checking with interest $ 25,746 $ 23,427 $ 2,319 9.9 % 1.56 % 1.73 % (17) $ 199 $ 201 $ (2) $ 19 $ (21) Money market 41,041 37,373 3,668 9.8 2.37 2.84 (47) 482 526 (44) 48 (92) Savings 47,543 45,046 2,497 5.5 3.47 3.79 (32) 818 845 (27) 45 (72) Time deposits 12,975 12,060 915 7.6 3.34 3.60 (26) 215 215 — 16 (16) Total interest-bearing deposits 127,305 117,906 9,399 8.0 2.72 3.06 (34) 1,714 1,787 (73) 128 (201) Borrowings: Short-term borrowings 180 450 (270) (60.1) 0.36 0.55 (19) — 1 (1) (1) — Senior unsecured borrowings 928 363 565 155.6 5.16 5.16 — 24 10 14 14 — Subordinated debt 1,763 1,218 545 44.8 5.27 4.49 78 47 27 20 15 5 Other borrowings 31,405 35,861 (4,456) (12.4) 3.66 3.66 — 575 657 (82) (82) — Long-term borrowings 34,096 37,442 (3,346) (8.9) 3.79 3.70 9 646 694 (48) (53) 5 Total borrowings 34,276 37,892 (3,616) (9.5) 3.77 3.66 11 646 695 (49) (54) 5 Total interest-bearing liabilities $ 161,581 $ 155,798 $ 5,783 3.7 % 2.94 3.20 (26) $ 2,360 $ 2,482 $ (122) $ 74 $ (196) Noninterest-bearing liabilities $ 50,284 $ 48,236 $ 2,048 4.2 % Stockholders' equity 22,332 22,472 (140) (0.6) Total liabilities and stockholders’ equity $ 234,197 $ 226,506 $ 7,691 3.4 Net interest spread (2) 2.38 % 2.47 % (9) Net interest margin and net interest income (2) 3.09 % 3.26 % (17) $ 3,277 $ 3,358 $ (81) (1) Loans and leases include nonaccrual loans and loans held for sale. Interest income on loans and leases includes accretion income and loan fees. (2) The average balances and yields for loans and leases are calculated net of average credit balances of factoring clients to appropriately reflect the interest-earning portion of factoring receivables. 68 NII and NIM (Current YTD Compared to Prior YTD) The table above quantifies the increases or decreases for the current YTD compared to the prior YTD for NII and NIM, as well as average balances of interest-earning assets and interest-bearing liabilities, and the respective yields earned and rates paid. The main reasons for the increases and decreases are explained below: •NII for the current YTD was $3.28 billion, a decrease of $81 million or 2% from $3.36 billion for the prior YTD. NII, excluding PAA,(1) was $3.19 billion for the current YTD, a decrease of $26 million from $3.22 billion for the prior YTD. The main reasons for the decreases in NII and NII, excluding PAA,(1) are explained below: ◦Interest income on interest-earning deposits at banks for the current YTD was $393 million, a decrease of $108 million or 22% from $501 million for the prior YTD, due to a decline in the federal funds rate and a lower average balance. ◦Interest income on investment securities (including securities purchased under agreements to resell) for the current YTD was $785 million, a decrease of $48 million or 6% from $833 million for the prior YTD, due to a lower average balance and a decline in yield. ◦Interest income on loans and leases for the current YTD was $4.46 billion, a decrease of $47 million or 1% from $4.51 billion for the prior YTD, mainly due to a lower yield and lower loan PAA, partially offset by a higher average balance. •Interest income on loans and leases, excluding loan PAA,(1) was $4.36 billion for the current YTD, an increase of $9 million from $4.35 billion for the prior YTD. •Loan PAA was $103 million in the current YTD, a decrease of $56 million or 35% from $159 million for the prior YTD. ◦Interest expense on interest-bearing deposits for the current YTD was $1.71 billion, a decrease of $73 million or 4% from $1.79 billion for the prior YTD, as a lower rate paid was partially offset by the impact of a higher average balance. ◦Interest expense on borrowings for the current YTD was $646 million, a decrease of $49 million or 7% from $695 million for the prior YTD, primarily due to a lower average balance as a result of $5.00 billion prepayments on the Purchase Money Note, partially offset by current YTD debt issuances of $1.25 billion and a higher rate paid on subordinated debt. •NIM for the current YTD was 3.09%, a decrease of 17 bps from 3.26% for the prior YTD. NIM, excluding PAA,(1) was 3.01% for the current YTD, a decrease of 12 bps from 3.13% for the prior YTD. ◦The yield on average interest-earning assets for the current YTD was 5.32%, a decrease of 35 bps from 5.67% for the prior YTD, mainly due to a decline in yield on loans, as well as lower loan PAA and lower yields on and average balances of interest-earning deposits at banks and investment securities, partially offset by a higher average balance of loans. ◦The rate paid on average interest-bearing liabilities for the current YTD was 2.94%, a decrease of 26 bps from 3.20% for the prior YTD, primarily due to a lower rate paid on interest-bearing deposits and a lower average balance of borrowings, partially offset by a higher average balance of interest-bearing deposits and a higher rate paid for subordinated debt. (1) Refer to the “NII, NIM, and Interest Income on Loans and Leases, Excluding PAA” discussion in the “Non-GAAP Financial Measurements” section of this MD&A for further information. The following table shows the types of average interest-earning assets as a percentage of total average interest-earning assets. Table 7 Average Interest-earning Asset Mix Three Months Ended Six Months Ended June 30, June 30, 2026 March 31, 2026 June 30, 2025 2026 2025 Loans and leases 70 % 70 % 68 % 70 % 68 % Investment securities 20 20 21 20 21 Interest-earning deposits at banks 10 10 11 10 11 Total interest-earning assets 100 % 100 % 100 % 100 % 100 % 69 The following table shows the average interest-bearing liabilities as a percentage of total average interest-bearing liabilities. Table 8 Average Interest-bearing Liability Mix Three Months Ended Six Months Ended June 30, June 30, 2026 March 31, 2026 June 30, 2025 2026 2025 Total interest-bearing deposits 80 % 78 % 76 % 79 % 76 % Long-term borrowings 20 22 24 21 24 Total interest-bearing liabilities 100 % 100 % 100 % 100 % 100 % Provision for Credit Losses Table 9 Provision for Credit Losses dollars in millions Three Months Ended Increase (Decrease) from Linked Quarter Six Months Ended Increase (Decrease) from Prior YTD June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 Provision for loan and lease losses $ 34 $ 103 $ 111 $ (69) (67.5) % $ 137 $ 259 (122) (47.0) % (Benefit) provision for off-balance sheet credit exposure (44) (32) 4 (12) (36.6) (76) 10 (86) NM Provision for other receivables — 1 — (1) (100.0) 1 — 1 100.0 (Benefit) provision for credit losses $ (10) $ 72 $ 115 $ (82) (113.9) % $ 62 $ 269 $ (207) (77.0) % Benefit for credit losses was $10 million for the current quarter, compared to a provision for credit losses of $72 million for the linked quarter. The current quarter included a provision for loan and lease losses of $34 million that was more than offset by a benefit for off-balance sheet credit exposure of $44 million. •The provision for loan and lease losses for the current quarter was $34 million, compared to $103 million for the linked quarter. The $69 million decrease was mainly attributable to the impact of a $74 million reserve release in the current quarter compared to an $8 million reserve release in the linked quarter, as well as a decline of $3 million in net charge-offs. ◦The $74 million ALLL reserve release in the current quarter was largely driven by lower specific reserves, improvements in credit quality including updates to certain models used to estimate the ALLL as further discussed in the “Risk Management—Credit Risk—ALLL Methodology” section of this MD&A, changes in the macroeconomic scenarios, and growth concentrated in capital call lines which have a significantly lower loss rate relative to our other loan portfolios. ◦The $8 million reserve release in the linked quarter was driven by loan growth concentrated in capital call lines and changes in the macroeconomic scenarios, partially offset by higher reserves for individually evaluated loans. •The benefit for off-balance sheet credit exposure was $44 million, an increase of $12 million from $32 million for the linked quarter, primarily due to the model updates discussed above and changes in the macroeconomic scenarios. Provision for credit losses for the current YTD was $62 million, a decrease of $207 million or 77% from $269 million for the prior YTD. The current YTD included a provision for loan and lease losses of $137 million, partially offset by a benefit for off-balance sheet credit exposure of $76 million. •The provision for loan and lease losses for the current YTD was $137 million compared to $259 million for the prior YTD. The $122 million decrease was mainly due to an $82 million ALLL reserve release in the current YTD compared to $4 million in the prior YTD and a decline in net charge-offs of $44 million. The current YTD ALLL reserve release of $82 million is addressed in the summary above, which discusses the reserve releases of $74 million and $8 million for the current and linked quarters, respectively. ◦The $4 million ALLL reserve release in the prior YTD primarily reflected decreases related to Hurricane Helene, other credit quality improvements, growth concentrated in capital call lines, and a modest shift in our weighting from the downside to baseline economic scenario. •The benefit for off-balance sheet credit exposure for the current YTD was $76 million compared to a provision for the prior YTD of $10 million, resulting in a decrease in provision of $86 million, primarily due to the model updates discussed above and changes in the macroeconomic scenarios. The ALLL and net charge-offs are further discussed in the “Risk Management—Credit Risk” section of this MD&A and in Note 6—Allowance for Loan and Lease Losses. 70 Noninterest Income The following table presents noninterest income: Table 10 Noninterest Income dollars in millions Three Months Ended Increase (Decrease) from Linked Quarter Six Months Ended Increase (Decrease) from Prior YTD June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 Rental income on operating lease equipment $ 280 $ 281 $ 272 $ (1) (0.1) % $ 561 $ 542 $ 19 3.5 % Lending-related fees 73 69 69 4 4.4 142 135 7 4.9 Deposit fees and service charges 74 70 59 4 5.1 144 117 27 23.1 Client investment fees 59 53 52 6 13.8 112 105 7 7.6 Wealth management services 62 59 55 3 4.5 121 111 10 8.6 International fees 36 35 33 1 (0.4) 71 65 6 8.9 Factoring commissions 18 17 18 1 8.1 35 35 — — Cardholder services, net 38 38 41 — — 76 82 (6) (6.9) Merchant services, net 13 13 13 — — 26 27 (1) (3.4) Insurance commissions 13 13 14 — — 26 28 (2) (7.5) Fair value adjustment on marketable equity securities, net 15 3 2 12 370.3 18 (3) 21 759.6 Gain on sale of leasing equipment, net 14 11 8 3 15.0 25 13 12 91.9 Loss on extinguishment of debt (7) (8) — 1 11.6 (15) — (15) (100.0) Other noninterest income 88 38 42 50 138.1 126 56 70 126.7 Total noninterest income $ 776 $ 692 $ 678 $ 84 12.1 % $ 1,468 $ 1,313 $ 155 11.8 % Noninterest income for the current quarter was $776 million, an increase of $84 million or 12% from $692 million for the linked quarter, primarily due to the following: •The increase of $50 million in other noninterest income was mainly attributable to a $27 million increase in the fair value of equity warrants and a $17 million gain on sale of tax credit investments. Our equity warrant portfolio could continue to grow, and changes in fair value will largely depend on market conditions affecting the underlying entities, primarily private venture-backed companies in the technology, life sciences, or healthcare industries. •The increase of $12 million in the fair value of marketable equity securities was due to higher market prices for the underlying securities. •The increase of $6 million in client investment fees was mostly due to higher transaction volumes and average balances. •Lending-related fees increased $4 million, mainly due to line of credit fees. •Deposit fees and service charges increased $4 million, largely attributable to overdraft fees. •The loss on extinguishment of debt for the current and linked quarters were due to continued prepayments of the Purchase Money Note. Noninterest income for the current YTD was $1.47 billion, an increase of $155 million or 12% from $1.31 billion for the prior YTD as further discussed below: •The increase of $70 million in other noninterest income was mainly attributable to a $34 million increase in the fair value of equity warrants discussed above, a $17 million gain on sale of tax credit investments, a $10 million increase in other real estate owned (“OREO”) income due to a write down in the prior YTD, and a $6 million increase in derivative fee income largely due to higher commercial client transaction volumes. •The increase of $27 million in deposit fees and service charges was primarily due to higher overdraft fees charged, and higher volume-related service charges for commercial clients. •The increase of $19 million in rental income on operating lease equipment was mainly the result of growth in the railcar portfolio. •The $21 million increase in the fair value of marketable equity securities was due to higher market prices for the underlying securities. •The increase of $12 million in gain on sale of leasing equipment was primarily the result of higher volume of rail equipment sales. •The increase of $10 million in wealth management services was primarily due to growth in assets under management. 71 Noninterest Expense The following table presents noninterest expense: Table 11 Noninterest Expense dollars in millions Three Months Ended Increase (Decrease) from Linked Quarter Six Months Ended Increase (Decrease) from Prior YTD June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 Depreciation on operating lease equipment $ 101 $ 101 $ 100 $ — — % $ 202 $ 198 $ 4 2.0 % Maintenance and other operating lease expenses 67 65 55 2 3.4 132 113 19 16.5 Personnel cost 844 869 810 (25) (2.9) 1,713 1,628 85 5.3 Net occupancy expense 59 60 61 (1) (0.9) 119 119 — — Equipment expense 141 136 131 5 2.9 277 267 10 3.7 Professional fees 26 24 30 2 4.2 50 55 (5) (10.1) Third-party processing fees 100 93 63 7 6.7 193 126 67 52.5 FDIC insurance expense 39 38 38 1 — 77 76 1 0.9 Marketing expense 45 30 32 15 48.9 75 64 11 17.2 Acquisition-related expenses 8 5 38 3 90.4 13 80 (67) (83.7) Intangible asset amortization 11 13 13 (2) (13.8) 24 28 (4) (16.6) Other noninterest expense 110 102 129 8 8.8 212 239 (27) (11.2) Total noninterest expense $ 1,551 $ 1,536 $ 1,500 $ 15 0.9 % $ 3,087 $ 2,993 $ 94 3.1 % Noninterest expense for the current quarter was $1.55 billion, an increase of $15 million or 1% from $1.54 billion for the linked quarter as further discussed below: •The increase of $15 million in marketing expense was primarily related to promotions for Direct Bank deposits. •The increase of $8 million in other noninterest expense was largely driven by the timing of charitable contributions. •Third-party processing fees and equipment expense increased $7 million and $5 million, respectively, as we advanced our long-term digital infrastructure dedicated to data center modernization and enhanced client-facing capabilities. •The increases above were partially offset by a decrease of $25 million in personnel cost, largely driven by lower incentive compensation and seasonal declines as employees reach annual benefit limits, partly tempered by merit increases, one additional payroll day, and higher health insurance claims. Noninterest expense for the current YTD was $3.09 billion, an increase of $94 million or 3% from $2.99 billion for the prior YTD as further discussed below: •The increase in personnel cost of $85 million was mainly due to higher salaries, reflecting higher merit and promotion costs and net staff additions, in addition to higher employee benefit costs. •Third-party processing fees and equipment expense increased $67 million and $10 million, respectively, as we advanced our long-term digital infrastructure dedicated to data center modernization and enhanced client-facing capabilities. •The increase of $19 million in maintenance and other operating lease expenses reflects timing and the number of railcars coming on or off lease as well as asset condition. Refer to the “Results by Segment—Rail” section of this MD&A for further information. •The increase of $11 million in marketing expense was primarily related to marketing promotions for Direct Bank deposits. •The decrease in acquisition-related expenses of $67 million is summarized in Table 12 and discussed below. •The decrease in other noninterest expense of $27 million was largely attributable to the prior YTD, which included accruals totaling $15 million resulting from a vendor dispute and an increase in litigation reserves. 72 Table 12 Acquisition-related Expenses dollars in millions Three Months Ended Six Months Ended June 30, June 30, 2026 March 31, 2026 June 30, 2025 2026 2025 Personnel cost $ 2 $ 1 $ 15 $ 3 $ 30 Professional fees — 1 20 1 46 Other acquisition-related expense 6 3 3 9 4 Total acquisition-related expense $ 8 $ 5 $ 38 $ 13 $ 80 The 2026 acquisition-related expenses relate to the pending BMO Branch Acquisition. Acquisition-related expenses for the prior year quarter and prior YTD include costs related to previous acquisitions. Personnel cost for the 2026 periods primarily relate to temporary contract labor costs. Personnel costs for the 2025 periods mainly included severance and retention costs for employees associated with business combinations. These amounts are recognized over the requisite service period, if any. Acquisition-related professional fees mainly include consulting, legal and accounting costs associated with business combinations and the related integration, optimization, and business process reengineering, including enhancements to technology. These amounts are expensed as incurred. Income Taxes Table 13 Income Tax Data dollars in millions Three Months Ended Six Months Ended June 30, June 30, 2026 March 31, 2026 June 30, 2025 2026 2025 Income before income taxes $ 891 $ 705 $ 758 $ 1,596 $ 1,409 Income tax expense $ 219 $ 171 $ 183 $ 390 $ 351 Effective income tax rate 24.5 % 24.3 % 24.1 % 24.4 % 24.9 % The effective income tax rate (“ETR”) was 24.5% for the current quarter compared to 24.3% for the linked quarter. The ETRs were 24.4% and 24.9% for the six months ended June 30, 2026 and 2025, respectively. The decrease in the ETR compared to the prior YTD was primarily due to higher tax credit benefits for 2026. The ETR is impacted by a number of factors, including the relative mix of domestic, state, and international earnings, effects of changes in enacted tax laws, adjustments to valuation allowances, and discrete items. The ETR in future periods may vary from the current quarter ETR due to changes in these factors. BancShares monitors and evaluates the potential impact of current events on the estimates used to establish income tax expense and income tax liabilities. On a periodic basis, we evaluate our income tax positions based on current tax law and positions taken by various tax auditors within the jurisdictions where BancShares is required to file income tax returns, as well as potential or pending audits or assessments by tax auditors. Refer to Note 16—Income Taxes for additional information. 73 RESULTS BY SEGMENT BancShares’ segments include the General Bank, the Commercial Bank, and Rail. All other financial information not included in the segments is reported in the Corporate section of the segment disclosures. Refer to Note 18—Segment Information for descriptions of segment products and services. General Bank Table 14 General Bank: Financial Data dollars in millions Three Months Ended Increase (Decrease) from Linked Quarter Six Months Ended Increase (Decrease) from Prior YTD Earnings Summary June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 Net interest income $ 819 $ 813 $ 824 $ 6 0.8 % $ 1,632 $ 1,612 $ 20 1.2 % Total noninterest income 187 172 164 15 8.5 359 328 31 9.3 Total revenue 1,006 985 988 21 2.1 1,991 1,940 51 2.6 Personnel cost 209 215 207 (6) (2.9) 424 417 7 1.5 All other noninterest expense 392 385 373 7 1.8 777 728 49 6.6 Total noninterest expense 601 600 580 1 0.1 1,201 1,145 56 4.8 Provision for credit losses 54 17 13 37 215.5 71 59 12 20.9 Income before income taxes 351 368 395 (17) (4.6) 719 736 (17) (2.3) Income tax expense 85 90 101 (5) (5.6) 175 189 (14) (7.4) Net income $ 266 $ 278 $ 294 $ (12) (4.2) $ 544 $ 547 $ (3) (0.5) Select Period End Balances Loans and leases $ 64,355 $ 64,367 $ 64,987 $ (12) — % $ 64,355 $ 64,987 $ (632) (1.0) % Deposits 75,718 75,914 73,499 (196) (0.3) 75,718 73,499 2,219 3.0 General Bank segment net income for the current quarter decreased $12 million from the linked quarter, primarily due to an increase in provision for credit losses, partially offset by higher noninterest income and NII. •The $37 million increase in provision for credit losses was mostly due to an ALLL reserve release in the linked quarter, partially offset by lower net charge-offs in the current quarter. •The $15 million increase in noninterest income was primarily due to higher gains on loan sales, including a gain on the SBA Securitization, deposit fees and service charges, and wealth management services. •The $6 million increase in NII was mostly due to a modest increase in loan yield. General Bank segment loans were $64.36 billion at June 30, 2026, a modest decline of $12 million or less than 1% compared to $64.37 billion at March 31, 2026. General Bank segment deposits were $75.72 billion at June 30, 2026, a marginal decrease of $196 million or less than 1% compared to $75.91 billion at March 31, 2026. General Bank segment net income for the current YTD decreased $3 million or less than 1% compared to the prior YTD, primarily due to higher noninterest expense and provision for credit losses, partially offset by higher noninterest income and NII. •The $56 million increase in total noninterest expense was mainly due to a $49 million increase in all other noninterest expense, which includes allocated expenses. •The $12 million increase in provision for credit losses was largely due to higher net charge-offs, partially offset by a lower ALLL reserve build. •The $31 million increase in total noninterest income was mostly due to higher deposit fees and service charges, including overdraft fees, and wealth management services. •The $20 million increase in NII was largely due to a higher yield on loans and a lower rate paid on interest-bearing deposits. 74 Commercial Bank Table 15 Commercial Bank: Financial Data dollars in millions Three Months Ended Increase (Decrease) from Linked Quarter Six Months Ended Increase (Decrease) from Prior YTD Earnings Summary June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 Net interest income $ 805 $ 802 $ 789 $ 3 0.5 % $ 1,607 $ 1,575 $ 32 2.0 % Noninterest Income Rental income on operating lease equipment 54 55 54 (1) (2.6) 109 110 (1) (1.4) All other noninterest income 270 230 228 40 17.5 500 429 71 16.7 Total noninterest income 324 285 282 39 13.6 609 539 70 13.0 Total revenue 1,129 1,087 1,071 42 3.9 2,216 2,114 102 4.8 Noninterest Expense Personnel cost 186 199 183 (13) (6.3) 385 373 12 3.6 Depreciation on operating lease equipment 43 43 44 — — 86 88 (2) (2.6) All other noninterest expense 400 404 422 (4) (1.2) 804 842 (38) (4.6) Total noninterest expense 629 646 649 (17) (2.7) 1,275 1,303 (28) (2.1) (Benefit) provision for credit losses (64) 55 102 (119) (216.5) (9) 210 (219) (104.3) Income before income taxes 564 386 320 178 46.4 950 601 349 58.1 Income tax expense 136 95 82 41 44.4 231 154 77 49.5 Net income $ 428 $ 291 $ 238 $ 137 47.1 $ 719 $ 447 $ 272 61.0 Select Period End Balances Loans and leases $ 86,635 $ 84,263 $ 76,220 $ 2,372 2.8 % $ 86,635 $ 76,220 $ 10,415 13.7 % Operating lease equipment, net 723 717 750 6 0.8 723 750 (27) (3.6) Deposits 45,690 47,191 40,697 (1,501) (3.2) 45,690 40,697 4,993 12.3 Table 16 Adjusted Rental Income on Operating Lease Equipment (non-GAAP) dollars in millions Three Months Ended Increase (Decrease) from Linked Quarter Six Months Ended Increase (Decrease) from Prior YTD June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 Rental income on operating leases (GAAP) $ 54 $ 55 $ 54 $ (1) (2.6) % $ 109 $ 110 $ (1) (1.4) % Less: depreciation on operating lease equipment 43 43 44 — — 86 88 (2) (2.6) Adjusted rental income on operating lease equipment (non-GAAP) (1) $ 11 $ 12 $ 10 $ (1) (8.3) $ 23 $ 22 $ 1 4.6 (1) Adjusted rental income on operating lease equipment is a non-GAAP measure. Refer to the “Non-GAAP Financial Measurements” section of this MD&A for a reconciliation from the most comparable GAAP measure to the non-GAAP measure. Commercial Bank segment net income for the current quarter increased $137 million compared to the linked quarter, primarily due to a benefit for credit losses, higher noninterest income, and lower noninterest expense. •The $119 million decrease in provision for credit losses was largely due to an ALLL reserve release for commercial and industrial, as well as commercial real estate, as discussed further in the “Risk Management—Credit Risk—ALLL Methodology” section later in this MD&A. •The $39 million increase in total noninterest income was largely attributable to an increase in the fair value of derivatives, higher client investment fees and gains on sales of leasing equipment. •The $17 million decrease in total noninterest expense mainly included a $13 million decrease in personnel cost and a $4 million decrease in all other noninterest expense, which includes allocated expenses. Commercial Bank segment loans were $86.64 billion at June 30, 2026, an increase of $2.37 billion from $84.26 billion at March 31, 2026, mainly concentrated in Global Fund Banking. Commercial Bank deposits were $45.69 billion at June 30, 2026, a decrease of $1.50 billion from $47.19 billion at March 31, 2026, largely due to large short-term deposits which moved off-balance sheet shortly after March 31, 2026. 75 Commercial Bank segment net income for the current YTD increased $272 million compared to the prior YTD, primarily due to a lower provision for credit losses, higher noninterest income, higher NII, and lower noninterest expense. •The $219 million decrease in provision for credit losses was largely due to an ALLL reserve release as mentioned above, in addition to lower net charge-offs. Refer to the “Risk Management—Credit Risk—ALLL Methodology” section of this MD&A for further discussion. •The $70 million increase in total noninterest income was largely due to the increases in lending-related fees, the fair value of derivatives, and client investment fees. •The $32 million increase in NII was largely due to the impact of loan growth and a lower rate paid on interest-bearing deposits, partially offset by a lower yield on loans, and deposit growth. •The $28 million decrease in total noninterest expense was mainly due to a $38 million decrease in all other noninterest expense, which includes allocated expenses, partially offset by a $12 million increase in personnel cost. Rail Table 17 Rail: Financial Data dollars in millions Three Months Ended Increase (Decrease) from Linked Quarter Six Months Ended Increase (Decrease) from Prior YTD Earnings Summary June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 Net interest expense $ (59) $ (58) $ (53) $ (1) (2.1) % $ (117) $ (105) $ (12) (10.9) % Noninterest Income Rental income on operating lease equipment 226 226 218 — — 452 432 20 4.7 All other noninterest income 7 9 3 (2) (28.0) 16 5 11 185.5 Total noninterest income 233 235 221 (2) (0.6) 468 437 31 7.0 Total revenue 174 177 168 (3) (1.5) 351 332 19 5.8 Noninterest Expense Personnel cost 6 8 6 (2) (14.6) 14 14 — — Depreciation on operating lease equipment 58 58 56 — — 116 110 6 5.7 Maintenance and other operating lease expenses 67 65 55 2 3.4 132 113 19 16.5 All other noninterest expense 18 17 26 1 1.5 35 40 (5) (15.0) Total noninterest expense 149 148 143 1 1.4 297 277 20 6.9 Income before income taxes 25 29 25 (4) (15.4) 54 55 (1) (1.0) Income tax expense 6 7 6 (1) (16.6) 13 14 (1) (5.0) Net income $ 19 $ 22 $ 19 $ (3) (15.1) % $ 41 $ 41 $ — — Select Period End Balances Loans and leases $ 44 $ 62 $ 62 $ (18) (29.7) % $ 44 $ 62 $ (18) (29.6) % Operating lease equipment, net 9,032 8,968 8,716 64 0.7 9,032 8,716 316 3.6 Deposits 2 2 3 — (1.5) 2 3 (1) (15.7) Table 18 Adjusted Rental Income on Operating Lease Equipment (non-GAAP) dollars in millions Three Months Ended Increase (Decrease) from Linked Quarter Six Months Ended Increase (Decrease) from Prior YTD June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 Rental income on operating leases (GAAP) $ 226 $ 226 $ 218 $ — — % $ 452 $ 432 $ 20 4.7 % Less: depreciation on operating lease equipment 58 58 56 — — 116 110 6 5.7 Less: maintenance and other operating lease expenses 67 65 55 2 3.4 132 113 19 16.5 Adjusted rental income on operating lease equipment (non-GAAP) (1) $ 101 $ 103 $ 107 $ (2) (1.9) $ 204 $ 209 $ (5) (2.4) (1) Adjusted rental income on operating lease equipment is a non-GAAP measure. Refer to the “Non-GAAP Financial Measurements” section of this MD&A for a reconciliation from the most comparable GAAP measure to the non-GAAP measure. 76 Rail segment net income for the current quarter decreased $3 million compared to the linked quarter, mostly due to lower gains on sales of leasing equipment. Rail segment net income for the current YTD was relatively unchanged compared to the prior YTD, as higher rental income on operating lease equipment and other noninterest income was offset by higher total noninterest expense and higher net interest expense. •The $20 million increase in rental income on operating lease equipment reflected portfolio growth and strong repricing. •The $11 million increase in all other noninterest income reflects higher gains on sales of operating lease equipment. •The $12 million increase in net interest expense was primarily due to higher funding costs and an increase in operating lease equipment. •Total noninterest expense increased $20 million. Depreciation on operating lease equipment increased $6 million, reflective of growth in operating lease equipment, and maintenance and other operating lease expenses increased $19 million. Maintenance and other operating lease expenses tend to be variable due to timing and the number of railcars coming on or off lease as well as asset condition. All other noninterest expense decreased $5 million as the prior YTD included a charge related to a vendor dispute. Railcar Portfolio Our fleet is diverse and the average re-pricing of equipment upon lease maturities was 115% of the average prior or expiring lease rate during the current quarter. Railcar utilization, including commitments to lease, was 96.7% at June 30, 2026 and 96.2% at December 31, 2025. Rail segment customers include all of the U.S. and Canadian Class I railroads (i.e., railroads with annual revenues of approximately $500 million and greater) and other railroads, as well as manufacturers and commodity shippers. Our total operating lease fleet at June 30, 2026 consisted of 129,331 railcars and locomotives. The following tables reflect the proportion of railcars by type based on units and net investment, and rail operating lease equipment by obligor industry: Table 19 Operating Lease Railcar Portfolio by Type (units and net investment) June 30, 2026 March 31, 2026 December 31, 2025 Railcar Type Total Owned Fleet - % Total Units Total Owned Fleet - % Total Net Investment Total Owned Fleet - % Total Units Total Owned Fleet - % Total Net Investment Total Owned Fleet - % Total Units Total Owned Fleet - % Total Net Investment Covered hoppers 45 % 41 % 45 % 41 % 45 % 41 % Tank cars 28 40 28 39 28 39 Mill/ coil gondolas 8 5 8 6 8 6 Coal 6 1 6 1 6 1 Boxcars 5 5 5 5 5 5 Other 8 8 8 8 8 8 Total 100 % 100 % 100 % 100 % 100 % 100 % Table 20 Rail Operating Lease Equipment by Obligor Industry dollars in millions June 30, 2026 March 31, 2026 December 31, 2025 Manufacturing $ 3,988 44 % $ 3,908 44 % $ 3,782 43 % Rail 2,017 22 2,010 22 2,047 23 Wholesale 1,567 18 1,582 18 1,554 18 Oil and gas extraction / services 468 5 475 5 487 5 Energy and utilities 188 2 198 2 206 2 Other 804 9 795 9 806 9 Total $ 9,032 100 % $ 8,968 100 % $ 8,882 100 % 77 Corporate Table 21 Corporate: Financial Data dollars in millions Three Months Ended Increase (Decrease) from Linked Quarter Six Months Ended Increase (Decrease) from Prior YTD Earnings Summary June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 Net interest income $ 91 $ 64 $ 135 $ 27 40.7 % $ 155 $ 276 $ (121) (43.7) % Total noninterest income 32 — 11 32 100.0 32 9 23 268.9 Total revenue 123 64 146 59 89.9 187 285 (98) (34.1) Personnel cost 443 447 414 (4) (1.1) 890 824 66 8.0 Acquisition-related expenses 8 5 38 3 90.4 13 80 (67) (83.7) All other noninterest expense (1) (279) (310) (324) 31 9.8 (589) (636) 47 7.6 Total noninterest expense 172 142 128 30 20.6 314 268 46 17.7 Provision for credit losses — — — — — — — — — Loss before income taxes (49) (78) 18 29 36.9 (127) 17 (144) NM Income tax (benefit) expense (8) (21) (6) 13 56.8 (29) (6) (23) (336.7) Net (loss) income $ (41) $ (57) $ 24 $ 16 29.9 $ (98) $ 23 $ (121) (517.2) Select Period End Balances Deposits 52,017 47,735 45,736 4,282 9.0 % 52,017 45,736 6,281 13.7 % (1) Under our segment expense allocation methodology, allocated expenses increase noninterest expense of the applicable segment(s), with an offsetting decrease to Corporate noninterest expense. “All other noninterest expense” in the Corporate table above includes the effect of allocated expenses, resulting in a reduction to expense (i.e., contra expense). The Corporate loss before income taxes was $49 million for the current quarter, compared to $78 million for the linked quarter. The $29 million change was mainly due to the following: •Total noninterest income increased $32 million, largely due to the gain on sale of tax credit investments and an increase in the fair value of marketable equity securities. •NII increased $27 million, mainly due to a higher yield on and average balance of investment securities, higher loan PAA, and a lower average balance of borrowings mainly due to prepayments of the Purchase Money Note, partially offset by a higher average balance of interest-bearing deposits. •Total noninterest expenses increased $30 million, primarily due to higher all other noninterest expense, which includes allocated expenses. Corporate deposits were $52.02 billion at June 30, 2026, an increase of $4.28 billion compared to $47.74 billion at March 31, 2026, as Direct Bank and brokered deposits increased $2.81 billion and $1.49 billion, respectively. At June 30, 2026, Corporate deposits primarily included $48.22 billion of Direct Bank deposits, the vast majority of which are savings, and $3.32 billion of brokered deposits, which are further discussed in the “Executive Overview—Funding, Liquidity and Capital Overview” section of this MD&A. The Corporate loss before income taxes was $127 million for the current YTD, compared to income before income taxes of $17 million for the prior YTD. The $144 million change primarily reflected lower NII and higher noninterest expense, partially offset by higher noninterest income. •NII decreased $121 million mainly due to the impacts of lower average balances of and yields on interest-earning deposits at banks and investment securities, a higher average balance of interest-bearing deposits, and lower loan PAA, partially offset by a lower rate paid on interest-bearing deposits and a lower average balance of borrowings, mainly due to prepayments of the Purchase Money Note. •Total noninterest expenses increased $46 million. All other noninterest expense, which includes allocated expenses, increased $47 million. Personnel cost increased $66 million, mainly due to higher salaries, reflecting higher merit and promotion costs and net staff additions, in addition to higher employee benefit costs. The decrease in acquisition-related expenses of $67 million is summarized in Table 12 and discussed in the “Results of Operations—Noninterest Expense” section of this MD&A. •Total noninterest income increased $23 million, largely due to the gain on sale of tax credit investments, and an increase in the fair value of marketable equity securities, partially offset by the loss on extinguishment of debt. 78 BALANCE SHEET ANALYSIS The following discussion provides additional information about the major components of our balance sheet. Information regarding our ALLL is included in the “Risk Management—Credit Risk—ALLL Methodology” section of this MD&A and in Note 6—Allowance for Loan and Lease Losses. Information regarding our capital and regulatory capital is included in the “Capital” section of this MD&A. Interest-earning Assets Interest-earning assets include interest-earning deposits at banks, securities purchased under agreements to resell, investment securities, loans held for sale, and loans and leases, all of which reflect varying interest rates based on the risk level and repricing characteristics of the underlying asset. Higher-risk investments typically carry a higher interest rate, but could expose us to higher levels of market and/or credit risk. We strive to maintain a high level of interest-earning assets relative to total assets. Interest-earning Deposits at Banks Interest-earning deposits at banks are primarily comprised of interest-earning deposits at the FRB. Interest-earning deposits at banks as of June 30, 2026 totaled $21.13 billion, an increase of $1.33 billion or 7% from $19.80 billion at December 31, 2025. The increase from December 31, 2025 is a function of the balance sheet trends discussed above in “Executive Overview—Financial Performance Summary—Balance Sheet Highlights.” Securities Purchased Under Agreements to Resell Securities purchased under agreements to resell at June 30, 2026 totaled $737 million, an increase of $505 million from $232 million at December 31, 2025, due primarily to timing of these short-term investments. Investment Securities The primary objective of the investment portfolio is to generate incremental income by deploying excess funds into securities that have minimal liquidity risk and low to moderate interest rate risk and credit risk. Other objectives include acting as a stable source of liquidity, serving as a tool for asset and liability management and maintaining an interest rate risk profile compatible with our objectives. Changes in the total balance of our investment securities portfolio result from trends in balance sheet funding and market performance. Generally, when inflows arising from deposit and treasury services products exceed loan and lease demand, we invest excess funds into the securities portfolio or into interest-earning deposits at banks. Conversely, when loan demand exceeds growth in deposits and short-term borrowings, we allow interest-earning deposits at banks to decline and use proceeds from maturing securities and prepayments to fund loan growth. Also refer to Note 3—Investment Securities and “Funding, Liquidity and Capital Overview” in the “Executive Overview” section of this MD&A for additional disclosures regarding investment securities. The carrying value of investment securities at June 30, 2026 totaled $43.56 billion, an increase of $1.99 billion or 5% from $41.56 billion at December 31, 2025. The increase mainly resulted from purchases of $8.79 billion, which were primarily short duration available for sale U.S. treasury and agency mortgage-backed securities, partially offset by maturities, sales, and prepayments totaling $6.57 billion. Our portfolio of investment securities available for sale consists of mortgage-backed securities issued by government agencies and government sponsored entities, U.S. Treasury securities, corporate and municipal bonds, and Retained SBA Notes. Investment securities available for sale are reported at fair value and unrealized gains and losses are included as a component of AOCI, net of deferred taxes. As of June 30, 2026, investment securities available for sale had a pretax net unrealized loss of $527 million, compared to $162 million as of December 31, 2025, primarily reflecting changes in interest rates. The fair value of investment securities is impacted by interest rates, credit spreads, market volatility and liquidity conditions. The fair value of the investment securities portfolio generally increases when interest rates decrease or when credit spreads tighten. Our portfolio of investment securities held to maturity consists of mortgage-backed securities issued by government agencies and government sponsored entities, U.S. Treasury notes, unsecured bonds issued by government agencies and government sponsored entities, and by the Supranational Entities & Multilateral Development Banks. 79 The following table presents the investment securities portfolio, segregated by major category: Table 22 Investment Securities dollars in millions June 30, 2026 March 31, 2026 December 31, 2025 Amortized Cost Fair Value Composition (1) Amortized Cost FairValue Composition (1) Amortized Cost Fair Value Composition (1) Investment securities available for sale: U.S. Treasury $ 13,365 $ 13,320 31.5 % $ 12,439 $ 12,442 29.8 % $ 10,624 $ 10,673 26.4 % Government agency 34 33 0.1 39 38 0.1 44 43 0.1 Residential mortgage-backed securities 17,804 17,500 41.3 17,782 17,595 42.1 17,683 17,623 43.6 Commercial mortgage-backed securities 3,145 2,972 7.0 3,259 3,099 7.4 3,444 3,299 8.2 Corporate bonds 132 128 0.3 132 128 0.3 145 140 0.3 Municipal bonds 12 12 — 12 12 — 12 12 — Other (2) 18 18 — — — — — — — Total investment securities available for sale $ 34,510 $ 33,983 80.2 % $ 33,663 $ 33,314 79.7 % $ 31,952 $ 31,790 78.6 % Investment in marketable equity securities $ 95 $ 156 0.4 % $ 83 $ 130 0.3 % $ 83 $ 127 0.3 % Investment securities held to maturity: U.S. Treasury $ 390 $ 376 0.9 % $ 389 $ 374 0.9 % $ 388 $ 373 0.9 % Government agency 1,190 1,135 2.7 1,205 1,150 2.8 1,225 1,170 2.9 Residential mortgage-backed securities 4,311 3,830 9.0 4,395 3,926 9.4 4,450 3,992 9.9 Commercial mortgage-backed securities 3,279 2,646 6.3 3,305 2,682 6.4 3,337 2,729 6.8 Supranational securities 247 226 0.5 246 226 0.5 246 226 0.6 Other 1 1 — 2 2 — 1 1 — Total investment securities held to maturity $ 9,418 $ 8,214 19.4 % $ 9,542 $ 8,360 20.0 % $ 9,647 $ 8,491 21.1 % Total investment securities $ 44,023 $ 42,353 100.0 % $ 43,288 $ 41,804 100.0 % $ 41,682 $ 40,408 100.0 % (1) Calculated as a percentage of the total fair value of investment securities. (2) Other investment securities available for sale includes Retained SBA Notes (as defined in Note 9—Variable Interest Entities). 80 The following table presents the weighted average yields for investment securities available for sale and held to maturity at June 30, 2026, segregated by major category with ranges of contractual maturities. The weighted average yields represent the yields of the underlying securities as of the specified date, June 30, 2026, within the specified maturity range. The weighted average yield on the portfolio was calculated using security-level annualized yields based on book yield to maturity and takes into account amortization of premiums and accretion of discounts. The total weighted average yields for investment securities available for sale and held to maturity are based on the underlying weighted average amortized cost. Table 23 Weighted Average Yield on Investment Securities June 30, 2026 Within One Year One to Five Years Five to 10 Years After 10 Years Total Investment securities available for sale: U.S. Treasury 4.15 % 3.82 % — % — % 3.93 % Government agency — 3.45 — — 3.45 Residential mortgage-backed securities (1) — 4.66 3.80 4.41 4.21 Commercial mortgage-backed securities (1) 4.26 4.78 4.49 2.68 3.91 Corporate bonds — 7.83 5.24 — 7.52 Municipal bonds — — — 7.73 7.73 Other (2) — — — 6.36 6.36 Total investment securities available for sale 4.15 % 4.02 % 3.81 % 4.25 % 4.09 % Investment securities held to maturity: U.S. Treasury 1.42 % 1.44 % — % — % 1.43 % Government agency 1.41 1.70 — — 1.61 Residential mortgage-backed securities (1) — — 1.07 2.87 2.71 Commercial mortgage-backed securities (1) — 1.83 4.65 2.43 2.44 Supranational securities — 1.64 — — 1.64 Other 3.17 — — — 3.17 Total investment securities held to maturity 1.42 % 1.64 % 1.27 % 2.67 % 2.40 % (1) Residential mortgage-backed and commercial mortgage-backed securities, which are not due at a single maturity date, have been included in maturity groupings based on the contractual maturity at June 30, 2026. The expected life will differ from contractual maturities because borrowers have the right to prepay the underlying loans. (2) Other includes Retained SBA Notes. Refer to the “Executive Overview—Recent Events—SBA Securitization” section of this MD&A and Note 9—Variable Interest Entities for further information. Assets Held for Sale Assets held for sale at June 30, 2026 were $93 million, a decrease of $711 million from $804 million at December 31, 2025, primarily due to loan sales. The composition of assets held for sale is included in the following table: Table 24 Assets Held for Sale Increase (Decrease) from: dollars in millions June 30, 2026 March 31, 2026 December 31, 2025 March 31, 2026 December 31, 2025 Loans and leases: Commercial (1) $ 34 $ 385 $ 18 $ (351) (91.2) % $ 16 84.0 % Consumer 56 733 781 (677) (92.3) (725) (92.8) Loans and leases 90 1,118 799 (1,028) (91.9) (709) (88.7) Operating lease equipment 3 4 5 (1) (13.3) (2) (40.4) Total assets held for sale $ 93 $ 1,122 $ 804 $ (1,029) (91.7) % $ (711) (88.4) % (1) There were nonaccrual loans held for sale of $0 at June 30, 2026 and March 31, 2026, and $10 million at December 31, 2025. 81 In March 2026, FCB management committed to a plan to sell SBA commercial loans, which were then transferred from held for investment to held for sale. We did not establish a valuation allowance for the loans transferred to held for sale as the estimated fair value exceeded amortized cost. In June 2026, all of the SBA commercial loans held for sale totaling $363 million in amortized cost were sold in the SBA Securitization and BancShares recognized a gain of $3 million. Consumer loans held for sale at June 30, 2026 and December 31, 2025 consisted of residential mortgage loans that FCB originated with the intent to sell. Additionally, consumer loans held for sale at December 31, 2025 were largely comprised of residential mortgage loans that were transferred from held for investment to held for sale in December 2025. We did not establish a valuation allowance for the loans transferred to held for sale as the estimated fair value exceeded the amortized cost. In April 2026, these residential mortgage loans held for sale totaling $644 million in amortized cost were sold and BancShares recognized a gain of $1 million. Loans and Leases The following table presents loans and leases by loan segment and loan class, and the respective proportion to total loans: Table 25 Loans and Leases dollars in millions June 30, 2026 March 31, 2026 December 31, 2025 Balance Increase (Decrease) from: Balance % to Total Loans Balance % to Total Loans Balance % to Total Loans March 31, 2026 December 31, 2025 Commercial: Commercial and industrial $ 46,574 31 % $ 45,753 31 % $ 44,721 30 % $ 821 1.8 % $ 1,853 4.1 % Capital call lines 34,203 22 32,274 21 31,791 21 1,929 6.0 $ 2,412 7.6 Owner occupied commercial mortgage 17,904 12 17,502 12 17,660 12 402 2.3 $ 244 1.4 Investor dependent 2,624 2 2,714 2 2,778 2 (90) (3.3) $ (154) (5.5) Commercial real estate 23,233 15 23,707 16 23,784 16 (474) (2.0) $ (551) (2.3) Total commercial $ 124,538 82 % $ 121,950 82 % $ 120,734 81 % $ 2,588 2.1 % 3,804 3.2 % Consumer: — — Residential mortgage $ 21,566 14 % $ 21,698 14 % $ 21,861 15 % $ (132) (0.6) % $ (295) (1.3) % Revolving mortgage 2,868 2 2,863 2 2,863 2 5 0.2 $ 5 0.2 Auto 1,261 1 1,332 1 1,416 1 (71) (5.4) $ (155) (11.0) Other consumer 801 1 849 1 1,056 1 (48) (5.7) $ (255) (24.2) Total consumer $ 26,496 18 % $ 26,742 18 % $ 27,196 19 % $ (246) (0.9) % (700) (2.6) % Total loans and leases $ 151,034 100 % $ 148,692 100 % $ 147,930 100 % $ 2,342 1.60 % $ 3,104 2.1 % Allowance for loan and lease losses (1,484) (1,558) (1,566) Net loans and leases $ 149,550 $ 147,134 $ 146,364 Loans and leases at June 30, 2026 were $151.03 billion, an increase of $3.10 billion or 2% from $147.93 billion at December 31, 2025, primarily due to growth of $2.41 billion in capital call lines. The unamortized discount related to acquired loans was $1.22 billion at June 30, 2026, a decrease of $105 million from $1.33 billion at December 31, 2025. Refer to Note 5—Loans and Leases for further information. 82 Operating Lease Equipment, Net Our operating lease portfolio mostly relates to the Rail segment, with the remainder included in the Commercial Bank segment as summarized in the following table. Refer to the “Results by Segment” section of this MD&A for further details on the operating lease equipment portfolio in Rail. Table 26 Operating Lease Equipment, Net dollars in millions Balance Increase (Decrease) from: June 30, 2026 March 31, 2026 December 31, 2025 March 31, 2026 December 31, 2025 Railcars and locomotives $ 9,032 $ 8,968 $ 8,882 $ 64 0.7 % $ 150 1.7 % Other equipment 723 717 739 6 0.8 (16) (2.2) Total (1) $ 9,755 $ 9,685 $ 9,621 $ 70 0.7 % $ 134 1.4 % (1) Includes off-lease rail equipment of $251 million at June 30, 2026, $265 million at March 31, 2026 and $257 million at December 31, 2025. Interest-bearing Liabilities Interest-bearing liabilities include interest-bearing deposits, securities sold under agreements to repurchase, and borrowings. Interest-bearing liabilities at June 30, 2026 totaled $163.14 billion, an increase of $6.21 billion or 4% from $156.93 billion at December 31, 2025. The increase from December 31, 2025 was mainly due to deposit growth, partially offset by lower borrowings as further discussed below. Deposits We strive to maintain a strong liquidity position, and therefore, deposit retention remains a key business objective. We believe traditional bank deposit products remain an attractive option for many customers. As economic conditions change, we recognize that our liquidity position could be adversely affected if bank deposits are withdrawn. Our ability to fund future loan growth is significantly dependent on our success in retaining existing deposits and generating new deposits at a reasonable cost. The following table summarizes the types of deposits: Table 27 Deposits dollars in millions Balance Increase (Decrease) from: June 30, 2026 March 31, 2026 December 31, 2025 March 31, 2026 December 31, 2025 Noninterest-bearing $ 42,475 $ 43,606 $ 40,653 $ (1,131) (2.6) % $ 1,822 4.5 % Checking with interest 25,778 25,599 24,377 179 0.7 1,401 5.7 Money market 39,964 41,136 38,687 (1,172) (2.9) 1,277 3.3 Savings 50,083 47,258 46,625 2,825 6.0 3,458 7.4 Time 15,127 13,243 11,236 1,884 14.2 3,891 34.6 Interest-bearing deposits 130,952 127,236 120,925 3,716 2.9 10,027 8.3 Total deposits $ 173,427 $ 170,842 $ 161,578 $ 2,585 1.5 % $ 11,849 7.3 % Noninterest-bearing deposits to total deposits 24.5 % 25.5 % 25.2 % Deposits at June 30, 2026 were $173.43 billion, an increase of $11.85 billion or 7% from $161.58 billion at December 31, 2025 as further discussed below: •Corporate deposit growth of $6.77 billion was primarily due to Direct Bank and brokered deposit growth of $3.42 billion and $3.32 billion, respectively. •Commercial Bank segment deposit growth of $4.16 billion was mainly in Global Fund Banking and Tech and Healthcare lines of business. Most of the growth was in noninterest-bearing deposits and interest-bearing checking. •General Bank segment deposit growth of $922 million was primarily concentrated in our Branch Network. Deposit growth was mostly in time deposits and noninterest-bearing deposits. Noninterest-bearing deposits grew by $1.82 billion or 5% compared to December 31, 2025 and represented 24.5% of total deposits as of June 30, 2026, compared to 25.2% at December 31, 2025. 83 Deposit Concentrations BancShares operates a network of branches and offices, predominantly located in the Southeast, Mid-Atlantic, Midwest and Western United States, providing a broad range of financial services to individuals, businesses and professionals. Based on branch location, our top state deposit concentrations as of June 30, 2026 were in North Carolina, South Carolina, and California, which represented 26.0%, 7.2%, and 6.3%, respectively, of total deposits. The Direct Bank had $48.22 billion or 27.8% of our total deposits as of June 30, 2026. The Direct Bank deposits mainly consist of savings. Commercial Bank segment deposits as of June 30, 2026 were $45.69 billion or 26.3% of total deposits and are primarily concentrated in online banking. Deposits in the Commercial Bank segment include large dollar accounts with private equity and venture capital clients, primarily in the technology, life science and healthcare industries. Deposit accounts with balances in excess of $50 million totaled $10.75 billion as of June 30, 2026, compared to $7.09 billion as of December 31, 2025. Brokered deposits as of June 30, 2026 were $3.32 billion or 1.9% of total deposits. We had no brokered deposits as of December 31, 2025. We utilized brokered deposits more prevalently in 2026 as rates have been favorable relative to Direct Bank deposits. We will continue to monitor the rate environments for brokered and Direct Bank deposits to determine the target growth for these deposit channels. Uninsured Deposits The amount of uninsured deposits is estimated consistent with the methodologies and assumptions utilized in providing information to the FDIC and Federal Reserve. We estimate total uninsured deposits were $65.06 billion, which represented 37.5% of total deposits at June 30, 2026, compared to $61.81 billion or 38.3% of total deposits at December 31, 2025. Refer to the “Executive Overview—Funding, Liquidity and Capital Overview” and “Results by Segment” sections of this MD&A for further discussion of deposit composition, uninsured deposits, and recent deposit trends. The following table provides the expected maturity of time deposits with balances in excess of $250,000 as of June 30, 2026: Table 28 Maturities of Time Deposits In Excess of $250,000 dollars in millions June 30, 2026 Time deposits maturing in: Three months or less $ 799 Over three months through six months 364 Over six months through 12 months 359 More than 12 months 12 Total $ 1,534 Borrowings Total borrowings at June 30, 2026 were $32.19 billion, a decrease of $3.82 billion or 11% from $36.01 billion at December 31, 2025. The decrease from December 31, 2025 primarily related to the prepayments of the Purchase Money Note, partially offset by the current YTD debt issuances. Refer to the “Executive Overview—Recent Events” section of this MD&A for further information related to 2026 borrowings activity, and Table 30 below for current YTD debt issuances. 84 The following table presents borrowings, net of the respective unamortized purchase accounting adjustments, premiums, discounts, and issuance costs: Table 29 Borrowings dollars in millions Balance Increase (Decrease) from: June 30, 2026 March 31, 2026 December 31, 2025 March 31, 2026 December 31, 2025 Securities sold under agreements to repurchase $ 152 $ 170 $ 224 $ (18) (10.6) % $ (72) (32.0) % Federal Deposit Insurance Corporation 3.500% fixed rate note due March 2028 (1) 28,423 30,905 33,385 (2,482) (8.0) (4,962) (14.9) Senior Unsecured Borrowings 5.097% fixed-to-floating rate notes due July 2029 746 — — 746 100.0 746 100.0 5.231% fixed-to-floating rate notes due March 2031 491 497 497 (6) (1.2) (6) (1.2) 4.869% fixed-to-floating rate notes due March 2032 489 495 — (6) (1.2) 489 100.0 6.000% fixed rate notes due April 2036 58 58 58 — — — — Subordinated debt 6.125% fixed rate notes due March 2028 423 427 430 (4) (0.9) (7) (1.6) 5.600% fixed rate reset notes due September 2035 589 595 597 (6) (1.0) (8) (1.3) 6.254% fixed-to-fixed rate notes due March 2040 732 742 745 (10) (1.3) (13) (1.7) Capital lease obligations 85 73 72 12 16.4 13 18.1 Total borrowings $ 32,188 $ 33,962 $ 36,008 $ (1,774) (5.2) % $ (3,820) (10.6) % (1) Issued in connection with the SVBB Acquisition and secured by collateral. Refer to Note 5—Loans and Leases. The unamortized discount was $77 million, $95 million, and $115 million at June 30, 2026, March 31, 2026, and December 31, 2025, respectively. The following summarizes debt issuances in the current YTD: Table 30 Borrowings - Issuances dollars in millions Borrowing Type Issuance Date Stated Maturity Date Earliest Par Call Date Par Value Current Interest Rate Current Payment Frequency Rate Reset Date Interest Rate After Reset Payment Frequency After Reset Parent Company Fixed-to-Floating Rate Senior Notes March 3, 2026 March 3, 2032 March 3, 2031 $500 4.869% Semiannual March 3, 2031 Compounded SOFR + 148.7 bps Quarterly FCB Fixed-to-Floating Rate Senior Notes June 24, 2026 July 13, 2029 July 13, 2028 $750 5.097% Semiannual July 13, 2028 Compounded SOFR + 114.6 bps Quarterly We continually monitor our capital needs and market conditions in an effort to diversify our borrowing base and capital mix when appropriate. Refer to the “Risk Management—Liquidity Risk” section of this MD&A and Note 10—Borrowings for further information regarding liquidity and borrowings. 85 Other Assets and Liabilities The following table includes the components of other assets: Table 31 Other Assets dollars in millions Balance Increase (Decrease) from: June 30, 2026 March 31, 2026 December 31, 2025 March 31, 2026 December 31, 2025 Affordable housing tax credit and other unconsolidated investments (1) (2) $ 2,731 $ 2,909 $ 2,955 $ (178) (6.1) % $ (224) (7.6) % Accrued interest receivable 943 955 912 (12) (1.3) 31 3.4 Fair value of derivative financial instruments 508 498 534 10 2.2 (26) (4.8) Pension and other retirement plan assets 803 794 784 9 1.1 19 2.4 Right of use assets for operating leases, net 278 285 294 (7) (2.3) (16) (5.3) Income tax assets 526 504 510 22 4.4 16 3.1 Counterparty receivables 122 124 124 (2) (1.6) (2) (1.5) Bank-owned life insurance 107 107 108 — — (1) (1.3) Nonmarketable investments 158 164 167 (6) (4.1) (9) (5.6) Other real estate owned 113 110 119 3 2.4 (6) (5.8) Mortgage servicing rights 45 33 32 12 38.7 13 42.3 Federal Home Loan Bank stock 20 20 20 — — — — Other 1,105 1,010 964 95 9.3 141 14.5 Total other assets $ 7,459 $ 7,513 $ 7,523 $ (54) (0.7) % $ (64) (0.9) % (1) Refer to Note 9—Variable Interest Entities for additional information. (2) During the current quarter, we sold $161 million of tax credit investments and recognized a pretax gain of $17 million included in other noninterest income. The following table includes the components of other liabilities: Table 32 Other Liabilities dollars in millions Balance Increase (Decrease) from: June 30, 2026 March 31, 2026 December 31, 2025 March 31, 2026 December 31, 2025 Income tax liabilities $ 3,805 $ 3,825 $ 3,819 $ (20) (0.5) % $ (14) (0.4) % Commitments to fund tax credit investments 1,166 1,234 1,321 (68) (5.5) (155) (11.8) Accrued personnel cost (1) 724 519 1,042 205 39.5 (318) (30.5) Fair value of derivative financial instruments 466 448 494 18 4.1 (28) (5.7) Lease liabilities 310 317 329 (7) (2.1) (19) (5.8) Reserve for off-balance sheet credit exposure 184 228 260 (44) (19.2) (76) (29.1) Accrued interest payable 167 109 140 58 53.2 27 19.4 Accounts payable and other 1,166 1,143 1,321 23 1.9 (155) (11.7) Total other liabilities $ 7,988 $ 7,823 $ 8,726 $ 165 2.1 % $ (738) (8.5) % (1) Includes accruals for annual incentive compensation which is typically paid during the first quarter. Additionally, accrued personnel cost can fluctuate based on timing of the payroll cycle. A reserve for off-balance sheet credit exposure is established for unfunded commitments and is included in other liabilities. BancShares estimates the expected funding amounts and applies its probability of obligor default (“PD”) and loss given default (“LGD”) models to those expected funding amounts to estimate the reserve. The reserve for off-balance sheet credit exposure was $184 million at June 30, 2026, a decrease of $76 million compared to $260 million at December 31, 2025. Refer to the “Results of Operations—Provision for Credit Losses” section of this MD&A for further discussion. Refer to Note 19—Commitments and Contingencies for information relating to off-balance sheet commitments. 86 RISK MANAGEMENT Risk is inherent in any business. BancShares has defined a moderate risk appetite and a balanced approach to risk taking with a philosophy that does not preclude higher risk business activities commensurate with acceptable returns while meeting regulatory objectives. Through the comprehensive Risk Management Framework and Risk Appetite Policy and Statement, senior management has primary responsibility for day-to-day management of the risks we face with accountability of and support from all associates. Senior management applies various strategies to reduce the risks to which BancShares may be exposed, with effective challenge by independent risk management and oversight by management committees. The Board of Directors of the Parent Company (the “Board”) strives to ensure that risk management is a part of our business culture and that our policies and procedures to identify, assess, respond, and monitor risk are part of the decision-making process. The Board’s role in risk oversight is an integral part of our overall Risk Management Framework and Risk Appetite Policy. The Board administers its risk oversight function primarily through its Risk Committee. The Risk Committee structure is designed to allow for information flow, effective challenge and timely escalation of risk-related issues. The Risk Committee monitors adherence to our Risk Management Framework and Risk Appetite Policy and Statement and provides quarterly updates to the Board on risk management. Our Chief Risk Officer also provides regular reports to the Risk Committee and the Board. Management and independent risk functions make regular reports to the Risk Committee on key risk areas, including credit, market, capital, liquidity, operational, compliance, and strategic risks. The Risk Committee also reviews reports of examination by and communications from regulatory agencies, the results of internal and third-party testing and qualitative and quantitative assessments related to risk management, and any other matters within the scope of the Risk Committee’s oversight responsibilities. The Risk Committee monitors management’s response to certain risk-related regulatory and audit issues. In addition, the Risk Committee may coordinate with the Board’s Audit Committee, Technology Committee and the Compensation, Nominations and Governance Committee for the review of financial statements and related risks, technology and cybersecurity risk, compensation risk management, and other areas of responsibility. BancShares leverages a Three Lines Model to promote clarity of roles and responsibilities in managing risk. The first line is comprised of organizational functions that own or support the management of risk. The second line is led by the Chief Risk Officer, who reports to the Risk Committee of the Board, and is comprised of organizational functions that make up the Risk Management Department which has the responsibility for establishing risk frameworks, policies, standards, and procedures which support the Framework; providing proactive, transparent, and independent oversight and effective challenge of the first line; and identifying, measuring, monitoring, or controlling for aggregate risks. Internal audit is independent of the first and second lines, reporting directly to the Audit Committee of the Board and constitutes the third line. In combination with other risk management and monitoring practices, enterprise-wide stress testing activities are conducted within a defined framework. Stress tests are performed for various risks to ensure the financial institution can support continued operations during stressed periods. BancShares monitors and stress tests its capital and liquidity consistent with the safety and soundness expectations of the federal regulators. Refer to the “Regulatory Considerations” section of Item 1. Business included in the 2025 Form 10-K for further discussion. BancShares assesses emerging risks on an ongoing basis, such as monitoring economic sentiment and emerging geopolitical issues, inflationary pressures due to rising energy prices among other factors, and the impact of artificial intelligence on various industries. BancShares also continues to assess operational risks such as those associated with potential cyberattacks for FCB and third parties upon whom it relies. Assessments will remain ongoing as the conditions continue to exist and develop. BancShares is also assessing the potential risk of an economic slowdown or recession that could create increased credit and market risk having downstream impacts on earnings, capital, and/or liquidity. Supported by resilient economic conditions, baseline forecasts reflect improving commercial real estate property values and a lower unemployment rate compared to the prior year, which have favorably impacted the ALLL. Key indicators will continue to be monitored, and impacts assessed as part of our ongoing Risk Management Framework. 87 Credit Risk Credit risk is the risk arising from a borrower, obligor, or counterparty’s failure to meet the terms of any financial obligation, which can result in financial impact to current or anticipated earnings or capital, or strategic objectives. Loans and leases we originate are underwritten in accordance with our credit policies and procedures and are subject to periodic ongoing reviews. Acquired loans, regardless of whether purchased credit deteriorated (“PCD”) or Non-PCD, are recorded at fair value as of the acquisition date and are subject to periodic reviews to identify any further credit deterioration. Our independent credit review function conducts risk reviews and analyses of both originated and acquired loans to ensure compliance with credit policies and to monitor asset quality trends and borrower financial strength. These reviews include portfolio analysis by geographic location, industry, collateral type, and product. We strive to identify potential problem loans as early as possible, to record charge-offs as appropriate and to maintain an appropriate ALLL that accounts for expected losses over the life of the loan and lease portfolios. Commercial Lending and Leasing BancShares employs a credit ratings system where each commercial loan is assigned a PD, LGD, and/or overall credit rating using scorecards developed to rate each type of transaction incorporating assessments of both quantitative and qualitative factors. When commercial loans and leases are graded during underwriting, or when updated periodically thereafter, a model is run to generate a preliminary risk rating. These models incorporate both internal and external historical default and loss data, as well as other borrower and loan characteristics, to assign a risk rating. The preliminary risk rating assigned by the model can be adjusted as a result of borrower specific facts and circumstances that, in management’s judgment, warrant a modification of the modeled risk rating to arrive at the final approved risk ratings. Consumer Lending Consumer lending begins with an evaluation of a consumer borrower’s credit profile against published standards. Credit decisions are made after analyzing quantitative and qualitative factors to assess the borrower’s ability to repay the loan, and secondary sources of repayment, such as collateral value. Consumer products use traditional and measurable standards to document and assess the creditworthiness of a loan applicant. Credit standards follow industry standard documentation requirements. Performance is largely evaluated based on an acceptable pay history along with a quarterly assessment which incorporates current market conditions. Loans may also be monitored during quarterly reviews of the borrower’s refreshed credit score. When warranted, an additional review of the loan-to-value of the underlying collateral may be conducted. ALLL Methodology Our ALLL methodology is discussed further in the section entitled “Critical Accounting Estimates” of the MD&A and Note 1—Significant Accounting Policies and Basis of Presentation in the 2025 Form 10-K. The ALLL is also discussed in Note 6—Allowance for Loan and Lease Losses of this Form 10-Q. Our ALLL estimate as of June 30, 2026 included extensive reviews of the changes in credit risk associated with the uncertainties around macroeconomic forecasts. These loss estimates consider industry risk and the actual net losses incurred during prior periods of economic stress as well as recent credit trends. The ALLL represents management’s best estimate of credit losses expected over the life of the loan or lease, adjusted for expected contractual payments and the impact of prepayment expectations. Estimates for loan and lease losses are determined by analyzing quantitative and qualitative components present as of the evaluation date. The ALLL is calculated based on a variety of considerations, including, but not limited to actual net loss history of the various loan and lease pools, delinquency trends, changes in forecasted economic conditions, loan growth, estimated loan life, and changes in portfolio credit quality. Loans and leases are segregated into pools with similar risk characteristics and each pool has a model tailored for the applicable risks. Macroeconomic Forecasts Utilized in the Estimate of the ALLL While management utilizes its best judgment and information available, the ultimate adequacy of our ALLL is dependent upon a variety of factors beyond our control which are inherently difficult to predict, the most significant being the macroeconomic scenario forecasts that determine the economic variables, including the U.S. unemployment rate, U.S. real gross domestic product (“GDP”), home price index (“HPI”), and commercial real estate price index (“CRE price index”) utilized in the ALLL models. These economic variables are based on macroeconomic scenario forecasts with a forecast horizon that covers the reasonable and supportable period. 88 Due to the inherent uncertainty in the macroeconomic forecasts, BancShares utilizes baseline, upside, and downside macroeconomic scenarios and probability weights the scenarios based on review of variable forecasts for each scenario and comparison to expectations. Our scenario weighting has remained consistent since the second quarter of 2025. We will continue to monitor economic sentiment and emerging geopolitical issues, rising energy prices, and the impact of artificial intelligence on various industries. At June 30, 2026, ALLL estimates ranged from $1.21 billion, when weighing the upside scenario 100%, to $2.06 billion when weighting the downside scenario 100%. BancShares management determined that an ALLL of $1.48 billion was appropriate as of June 30, 2026. The following table presents the U.S. unemployment rate, U.S. real GDP, HPI, and CRE price index based on the weighted-average scenario forecasts used in determining the ALLL at June 30, 2026 and December 31, 2025. The projected trends in the macroeconomic variables below may fluctuate depending on the underlying scenarios and our scenario weighting assumptions utilized for the applicable period. Table 33 Select Variables in ALLL Weighted-average Scenarios Assumptions as of June 30, 2026 2026 2027 2028 U.S. unemployment rate (1) 4.7 % 5.5 % 5.3 % U.S. real GDP (2) 1.5 % 1.2 % 2.1 % HPI (2) (0.3) % (0.1) % 3.7 % CRE price index (2) 2.2 % (1.2) % 2.1 % Assumptions as of December 31, 2025 2026 2027 2028 U.S. unemployment rate (1) 5.2 % 5.4 % 5.1 % U.S. real GDP (2) 1.5 % 1.6 % 2.0 % HPI (2) (1.4) % 2.2 % 3.5 % CRE price index (2) (3.4) % (1.6) % 4.1 % (1) Assumptions represent the projected quarterly averages for the years ending December 31, 2026, 2027, and 2028. (2) Assumptions represent the projected year-over-year percent changes. Qualitative Component of the ALLL ALLL model outputs may be adjusted through a qualitative assessment to reflect trends that may not be adequately reflected within the models, which could include economic conditions, uncertainty in macroeconomic forecasts, credit quality, risk to specific industry concentrations, and any significant policy and underwriting changes. These qualitative adjustments are also used to accommodate for the imprecision of certain assumptions and uncertainties inherent in the model calculations. Current economic conditions and forecasts can change which could affect the anticipated amount of estimated credit losses and therefore the appropriateness of the ALLL. It is difficult to estimate how potential changes in any one economic factor or input might affect the overall ALLL because a wide variety of factors and inputs are considered in estimating the ALLL and changes in those factors and inputs considered may not occur at the same rate and may not be consistent across all product types. Additionally, changes in factors and inputs may be directionally inconsistent, such that improvement in one factor may offset deterioration in others. 89 The following table summarizes the ALLL for commercial, consumer and total loans. Table 34 ALLL dollars in millions Three Months Ended June 30, 2026 Three Months Ended March 31, 2026 Three Months Ended June 30, 2025 Commercial Consumer Total Commercial Consumer Total Commercial Consumer Total Balance at beginning of period $ 1,428 $ 130 $ 1,558 $ 1,436 $ 130 $ 1,566 $ 1,517 $ 163 $ 1,680 Provision for loan and lease losses 28 6 34 97 6 103 111 — 111 Charge-offs (122) (8) (130) (123) (9) (132) (137) (7) (144) Recoveries 19 3 22 18 3 21 21 4 25 Balance at end of period $ 1,353 $ 131 $ 1,484 $ 1,428 $ 130 $ 1,558 $ 1,512 $ 160 $ 1,672 Net charge-off ratio 0.29 % 0.30 % 0.33 % Net charge-offs $ 103 $ 5 $ 108 $ 105 $ 6 $ 111 $ 116 $ 3 $ 119 Average loans $ 150,094 $ 149,121 $ 141,791 Percent of loans in each category to total loans 82 % 18 % 100 % 82 % 18 % 100 % 80 % 20 % 100 % Six Months Ended June 30, 2026 Six Months Ended June 30, 2025 Commercial Consumer Total Commercial Consumer Total Balance at beginning of period $ 1,436 $ 130 $ 1,566 $ 1,518 $ 158 $ 1,676 Provision for loan and lease losses 125 12 137 249 10 259 Charge-offs (245) (17) (262) (296) (15) (311) Recoveries 37 6 43 41 7 48 Balance at end of period $ 1,353 $ 131 $ 1,484 $ 1,512 $ 160 $ 1,672 Net charge-off ratio 0.29 % 0.37 % Net charge-offs $ 208 $ 11 $ 219 $ 255 $ 8 $ 263 Average loans $ 149,611 $ 141,288 Percent of loans in each category to total loans 82 % 18 % 100 % 80 % 20 % 100 % The following table summarizes the ALLL as a percentage of loans for each loan class: Table 35 ALLL by Loan Class dollars in millions June 30, 2026 March 31, 2026 December 31, 2025 ALLL Loan Balance ALLL as a Percentage of Loans ALLL Loan Balance ALLL as a Percentage of Loans ALLL Loan Balance ALLL as a Percentage of Loans Commercial Commercial and industrial $ 740 $ 46,574 1.59 % $ 808 $ 45,753 1.77 % $ 807 $ 44,721 1.80 % Capital call lines 28 34,203 0.08 29 32,274 0.09 29 31,791 0.09 Owner occupied commercial mortgage 60 17,904 0.33 52 17,502 0.30 50 17,660 0.28 Investor dependent 170 2,624 6.46 166 2,714 6.12 181 2,778 6.52 Commercial real estate 355 23,233 1.53 373 23,707 1.58 369 23,784 1.55 Total commercial 1,353 124,538 1.09 1,428 121,950 1.17 1,436 120,734 1.19 Consumer Residential mortgage 72 21,566 0.33 70 21,698 0.32 67 21,861 0.31 Revolving mortgage 27 2,868 0.94 28 2,863 0.96 26 2,863 0.89 Auto 10 1,261 0.83 9 1,332 0.70 9 1,416 0.67 Other consumer 22 801 2.75 23 849 2.71 28 1,056 2.62 Total consumer 131 26,496 0.49 130 26,742 0.48 130 27,196 0.48 Total $ 1,484 $ 151,034 0.98 % $ 1,558 $ 148,692 1.05 % $ 1,566 $ 147,930 1.06 % The ALLL may vary significantly from period to period due to changes in economic conditions, economic forecasts, the composition and credit quality of the loan and lease portfolio, and the related impacts to the ALLL models. We continuously monitor and update our ALLL estimation methodology and models, as appropriate. During the current quarter, we implemented enhancements to our PD, LGD, and exposure at default models for the commercial and industrial, and commercial real estate portfolios which contributed to the decreases in the ALLL at June 30, 2026 compared to March 31, 2026 and December 31, 2025. 90 The ALLL was $1.48 billion at June 30, 2026, a decrease of $82 million or 5% from $1.57 billion at December 31, 2025, largely driven by lower specific reserves, improvements in credit quality including updates to certain models used to estimate the allowance as discussed above, changes in the macroeconomic scenarios, and growth concentrated in capital call lines which have a significantly lower loss rate relative to our other loan portfolios. The ALLL as a percentage of loans was 0.98% at June 30, 2026, a decrease of 7 bps from 1.05% at March 31, 2026 and a decrease of 8 bps from 1.06% at December 31, 2025. Net Charge-Offs The following table summarizes net charge-offs for each loan class: Table 36 Net Charge-Offs dollars in millions Three Months Ended June 30, 2026 Three Months Ended March 31, 2026 Three Months Ended June 30, 2025 Charge-offs Recoveries Net charge-offs (recoveries) Charge-offs Recoveries Net charge-offs (recoveries) Charge-offs Recoveries Net charge-offs (recoveries) Commercial Commercial and industrial $ 73 $ 10 $ 63 $ 95 $ 11 $ 84 $ 87 $ 11 $ 76 Owner occupied commercial mortgage 1 — 1 4 — 4 1 — 1 Investor dependent 17 5 12 12 7 5 29 10 19 Commercial real estate 31 4 27 12 — 12 20 — 20 Total commercial 122 19 103 123 18 105 137 21 116 Consumer Residential mortgage 1 1 — — 1 (1) — 1 (1) Revolving mortgage — 1 (1) — — — — 1 (1) Auto 2 — 2 2 1 1 2 1 1 Other consumer 5 1 4 7 1 6 5 1 4 Total consumer 8 3 5 9 3 6 7 4 3 Total $ 130 $ 22 $ 108 $ 132 $ 21 $ 111 $ 144 $ 25 $ 119 Six Months Ended June 30, 2026 Six Months Ended June 30, 2025 Charge-offs Recoveries Net charge-offs (recoveries) Charge-offs Recoveries Net charge-offs (recoveries) Commercial Commercial and industrial $ 168 $ 21 $ 147 $ 168 $ 26 $ 142 Owner occupied commercial mortgage 5 — 5 1 — 1 Investor dependent 29 12 17 68 15 53 Commercial real estate 43 4 39 59 — 59 Total commercial 245 37 208 296 41 255 Consumer Residential mortgage 1 2 (1) — 1 (1) Revolving mortgage — 1 (1) — 1 (1) Auto 4 1 3 3 1 2 Other consumer 12 2 10 12 4 8 Total consumer 17 6 11 15 7 8 Total $ 262 $ 43 $ 219 $ 311 $ 48 $ 263 Net charge-offs for the current quarter were $108 million, a decrease of $3 million from $111 million for the linked quarter, primarily due to a decline of $21 million in commercial and industrial, partially offset by an increase of $15 million in commercial real estate. Net charge-offs for the current YTD were $219 million, a decrease of $44 million from $263 million for the prior YTD, primarily due to decreases of $36 million in investor dependent and $20 million in commercial real estate, partially offset by increases of $5 million in commercial and industrial, and $4 million in owner occupied commercial mortgage. 91 Nonperforming Assets Nonperforming assets include nonaccrual loans and leases, OREO and repossessed assets. Accounting policies related to nonperforming assets are discussed in Note 1—Significant Accounting Policies and Basis of Presentation of the 2025 Form 10-K. Table 37 Non-Performing Assets Increase (Decrease) from: dollars in millions June 30, 2026 March 31, 2026 December 31, 2025 March 31, 2026 December 31, 2025 Nonaccrual loans: Commercial loans $ 1,204 $ 1,184 $ 1,082 $ 20 1.7 % $ 122 11.3 % Consumer loans 242 245 225 (3) (1.4) 17 7.2 Total nonaccrual loans 1,446 1,429 1,307 17 1.2 139 10.6 Other real estate owned (1) and repossessed assets 116 116 124 — — (8) (6.1) Total nonperforming assets $ 1,562 $ 1,545 $ 1,431 $ 17 1.1 $ 131 9.2 Total loans and leases $ 151,034 $ 148,692 $ 147,930 $ 2,342 1.6 % $ 3,104 2.1 % Total loans and leases, other real estate owned, and repossessed assets 151,150 148,808 148,054 $ 2,342 1.6 $ 3,096 2.1 ALLL to total loans and leases 0.98 % 1.05 % 1.06 % -7 bps -8 bps Ratio of total nonperforming assets to total loans, leases, other real estate owned and repossessed assets 1.03 1.04 0.97 -1 6 Ratio of nonaccrual loans and leases to total loans and leases 0.96 % 0.96 % 0.88 % — 8 Ratio of ALLL to nonaccrual loans and leases 102.61 109.01 119.80 -640 -1,719 (1) OREO includes former branch property and other non-foreclosed property of $22 million and $26 million as of June 30, 2026 and December 31, 2025, respectively. OREO and repossessed assets were $116 million at June 30, 2026 compared to $124 million at December 31, 2025, a decrease of $8 million. 92 Past Due and Nonaccrual Loans Past due and nonaccrual loans by loan class are summarized in the following table: Table 38 Delinquencies and Nonaccrual Loans dollars in millions June 30, 2026 March 31, 2026 December 31, 2025 Accruing Loans Accruing Loans Accruing loans 30-89 Days Past Due 90 Days orGreater Nonaccrual Loans 30-89 Days Past Due 90 Days orGreater Nonaccrual Loans 30-89 Days Past Due 90 Days orGreater Nonaccrual Loans Commercial Commercial and industrial $ 204 $ 37 $ 498 $ 251 $ 35 $ 461 $ 288 $ 63 $ 456 Capital call lines — — — 31 — — — — — Owner occupied commercial mortgage 85 14 153 89 16 162 97 1 159 Investor dependent 5 — 41 8 — 37 12 — 49 Commercial real estate 28 197 512 97 185 524 252 171 418 Total commercial 322 248 1,204 476 236 1,184 649 235 1,082 Consumer Residential mortgage 155 7 196 173 7 196 210 7 179 Revolving mortgage 28 — 35 27 — 38 29 — 35 Auto 13 — 10 12 — 10 18 — 9 Other consumer 7 1 1 6 2 1 8 2 2 Total consumer 203 8 242 218 9 245 265 9 225 Total $ 525 $ 256 $ 1,446 $ 694 $ 245 $ 1,429 $ 914 $ 244 $ 1,307 The decrease of $389 million from December 31, 2025 in accruing loans that are 30 to 89 days past due is largely attributable to declines of $224 million in commercial real estate, $84 million in commercial and industrial, $55 million in residential mortgage, and $12 million in owner occupied commercial mortgage. Accruing loans that are 30 to 89 days past due are early stage delinquencies that are not showing signs of significant credit deterioration. Delinquency status is considered in the estimate of the ALLL. The increase of $12 million from December 31, 2025 in accruing loans that are 90 days or greater past due is primarily attributable to increases of $26 million in commercial real estate and $13 million in owner occupied commercial mortgage, partially offset by a decrease of $26 million in commercial and industrial. Loans 90 days or greater past due are assigned a more severe PD in accordance with our ALLL methodology. Nonaccrual loans and leases at June 30, 2026 were $1.45 billion (0.96% of loans), an increase of $139 million compared to $1.31 billion (0.88% of loans) at December 31, 2025, largely concentrated in a small number of commercial and industrial, and commercial real estate loans that were individually evaluated. Nonaccrual loans over an established threshold are individually evaluated for specific ALLL reserves as discussed in Note 1—Significant Accounting Policies and Basis of Presentation of the 2025 Form 10-K. 93 Commercial Real Estate Portfolio Composition Our commercial real estate portfolio is diversified across various property types. The following table provides an overview of the property type exposures within our commercial real estate portfolio: Table 39 Commercial Real Estate Portfolio dollars in millions June 30, 2026 Balance % to Total Loans and Leases Multi-family $ 5,116 3.4 % Medical office 3,620 2.4 Industrial, including warehouses 2,801 1.9 Data center 2,722 1.8 General office 1,806 1.2 Healthcare 1,749 1.2 Retail 1,484 1.0 Hotel and motel 822 0.5 Other 3,113 2.0 Total $ 23,233 15.4 % Evolving macroeconomic and social conditions (including the shift to hybrid work arrangements) may result in changes for general office demand moving forward. Our general office portfolio has experienced more negative credit quality trends relative to our other commercial real estate portfolios. Our general office portfolio is 1.20% of total loans and leases and 7.77% of total commercial real estate at June 30, 2026. Select metrics for our general office portfolio are summarized in the following table: Table 40 General Office Portfolio dollars in millions June 30, 2026 General office as a percentage of total loans and leases 1.20 % General office as a percentage of commercial real estate loans 7.77 % Net charge-offs as a percentage of general office (YTD annualized %) 1.53 % Percentage of general office 30 days or more past due 7.81 % Nonaccrual loans as a percentage of general office 9.48 % ALLL as a percentage of general office 4.93 % 94 Concentration We strive to minimize the risks associated with large concentrations within specific geographic areas, collateral types or industries. Despite our focus on diversification, several characteristics of our loan portfolio subject us to concentration risk. Loan concentration for our commercial and consumer loans is summarized below. Commercial Loan Concentration Industry Concentration The following table summarizes the industry concentration of our commercial loans and leases based on the obligors’ industries: Table 41 Commercial Loans and Leases - Industry dollars in millions June 30, 2026 March 31, 2026 December 31, 2025 Finance and insurance $ 42,180 33.9 % $ 39,540 32.4 % $ 38,417 31.8 % Real estate 17,038 13.7 17,678 14.5 17,911 14.8 Healthcare 11,137 8.9 11,196 9.2 11,155 9.2 Information 10,390 8.3 10,015 8.2 9,699 8.0 Business services 9,808 7.9 9,584 7.9 9,601 8.0 Transportation, communication, gas, utilities 7,890 6.3 7,631 6.3 7,567 6.3 Manufacturing 7,189 5.8 7,134 5.8 7,137 5.9 Retail 4,148 3.3 4,466 3.7 4,329 3.6 Service industries 4,296 3.5 4,271 3.5 4,274 3.5 Wholesale 3,676 3.0 3,622 3.0 3,571 3.0 Other 6,786 5.4 6,813 5.5 7,073 5.9 Total $ 124,538 100.0 % $ 121,950 100.0 % $ 120,734 100.0 % Loans to non-depository financial institutions (“NDFIs”) Loans to borrowers in the finance and insurance industry were $42.18 billion or 33.9% of commercial loans and leases at June 30, 2026, compared to $38.42 billion or 31.8% of commercial loans and leases at December 31, 2025. Loans to NDFIs of $41.43 billion comprised 98.2% of our loans to borrowers in the finance and insurance industry at June 30, 2026. Our NDFI portfolio composition is presented in Table 42 and described below. Table 42 Loans to Non-Depository Financial Institutions June 30, 2026 dollars in millions Balance % of Total Loans to NDFIs Capital call lines $ 34,203 82.5 % Net asset value loans 2,689 6.5 Leveraged fund lines 1,392 3.4 Warehouse lines 1,059 2.6 Specialty finance 631 1.5 Other 1,453 3.5 Total $ 41,427 100.0 % As of June 30, 2026, loans to NDFIs were $41.43 billion. Capital call lines comprise $34.20 billion, or 83%, of the NDFI portfolio. The primary source of repayment for capital call lines is the capital commitments of the underlying limited partner (“LP”) investors in funds managed by certain private equity and venture capital firms. Capital calls are contractual obligations of the LPs and are not subject to the performance of the underlying portfolio of investments. Capital call lines are typically governed by financial covenants oriented towards ensuring that the funds’ remaining callable capital is sufficient to repay the loan, and larger commitments (typically provided to larger private equity funds) are typically secured by an assignment of the general partner's right to call capital from the fund's LP investors. The credit quality is strong for capital call lines based on the structural protection provided by the funds and the underlying investors. Capital call lines have a significantly lower loss rate relative to our other loan portfolios. As of June 30, 2026, the ALLL was 0.08% of capital call lines, compared to 0.98% of total loans. 95 The loans to NDFIs that are not capital call lines (the “Other NDFI Portfolios”) have balances totaling $7.22 billion at June 30, 2026, and the largest portfolios are described below: •The net asset value portfolio ($2.69 billion) consists of: (i) loans to private equity funds collateralized by the funds’ portfolios of direct equity investments in private companies, and (ii) loans to predominantly secondary funds collateralized by the funds’ portfolios of investments in LP interests in private funds and/or co-investment vehicles. •Leveraged fund lines ($1.39 billion) are lines of credit provided to private credit funds and are collateralized by portfolios of the underlying assets, primarily first lien loans. •Warehouse lines ($1.06 billion) are asset-based lines of credit that finance cash flows for large pools of assets, such as accounts receivable and loans, that the borrower (or sponsor) typically sell or transfer to special purpose vehicle entities. •Specialty finance ($631 million) includes asset-based lending facilities to lenders that are primarily investing in first lien senior debt. The Other NDFI Portfolios are included in commercial and industrial loans and leases. As of June 30, 2026, the ALLL was 1.59% of commercial and industrial loans and leases. Through our credit risk management practices and our targeted analysis of the NDFI portfolios, we determined that the ALLL was appropriate. NDFIs could be subject to a less stringent regulatory environment than FDIC-insured depository institutions or BHCs as further discussed in Item 1A. Risk Factors of the 2025 Form 10-K. We strive to mitigate the credit risk of our loans to NDFIs through our underwriting and credit monitoring processes. As discussed above, 83% of our NDFI portfolio at June 30, 2026 is comprised of capital call lines which have strong credit quality based on the structural protection provided by the funds and the underlying investors. Additionally, we establish advance rates (the percentage of the collateral value FCB will lend to the borrower) for loans in the Other NDFI Portfolios commensurate with the risks of the underlying collateral type, structural protection of the funds or investors, diversification of the funds, and financial strength of the borrower (or sponsor). Real estate secured loans Our commercial real estate portfolio comprises the vast majority of the real estate industry loans in Table 41, which is based on the industry of the obligor. Additionally, we have commercial real estate and owner occupied commercial mortgage loans that are secured by real estate, but are categorized in other industries in Table 41. At June 30, 2026, the combined balances of our commercial real estate and owner occupied commercial mortgage loans were $41.14 billion, or 33% of commercial loans and leases, compared to $41.44 billion or 34% at December 31, 2025. We have historically carried a concentration of real estate secured loans, but actively mitigate exposure through underwriting policies, which primarily rely on borrower cash flow rather than underlying collateral values. When we do rely on underlying real property values, we prefer financing secured by owner-occupied real property. Healthcare and information industries The healthcare and information industries in Table 41 largely consist of the healthcare, life sciences, and technology sectors, which include clients in our Commercial Finance, Global Fund Banking, and Technology and Healthcare Banking lines of business within our Commercial Bank segment. Loans and leases to borrowers in medical, dental or other healthcare fields were $11.14 billion as of June 30, 2026, which represents 8.9% of commercial loans and leases, compared to $11.16 billion or 9.2% of commercial loans and leases at December 31, 2025. Loans and leases to borrowers in the information industry were $10.39 billion as of June 30, 2026, which represents 8.3% of commercial loans and leases, compared to $9.70 billion or 8.0% of commercial loans and leases at December 31, 2025. We actively mitigate credit risk exposure of these industry concentrations through our underwriting policies that emphasize reliance on adequate levels of borrower repayment sources. Larger Balance Loans The following table provides a summary of commercial loans by loan size and loan class as of June 30, 2026: Table 43 Commercial Loans by Size and Class dollars in millions Less Than $10 Million $10 Million to $30 Million Greater Than $30 Million Total Commercial Loans Commercial and industrial $ 15,762 $ 11,447 $ 19,365 $ 46,574 Capital call lines 1,324 3,546 29,333 34,203 Owner occupied commercial mortgage 14,939 2,322 643 17,904 Investor dependent 1,475 874 275 2,624 Commercial real estate 8,189 6,653 8,391 23,233 Total $ 41,689 $ 24,842 $ 58,007 $ 124,538 96 Most of our loans greater than $30 million at June 30, 2026 are capital call lines which are described above in “Risk Management—Credit Risk—Concentration—Loans to non-depository financial institutions (“NDFIs”).” Geographic Concentrations The following table summarizes geographic concentrations based on the location of the real estate collateral for owner occupied commercial mortgage and commercial real estate loans, and based on the obligor address for all other commercial loans. Table 44 Commercial Loans and Leases - Geography dollars in millions June 30, 2026 March 31, 2026 December 31, 2025 State California $ 26,291 21.1 % $ 25,324 20.8 % $ 26,056 21.6 % New York 12,284 9.9 12,129 9.9 12,193 10.1 North Carolina 11,745 9.4 11,258 9.2 11,005 9.1 Texas 9,491 7.6 9,570 7.9 8,811 7.3 Massachusetts 7,802 6.3 7,484 6.1 7,325 6.1 Florida 6,455 5.2 6,259 5.1 6,175 5.1 All other states 47,367 38.0 46,900 38.5 46,093 38.2 Total U.S. $ 121,435 97.5 % $ 118,924 97.5 % $ 117,658 97.5 % Total international 3,103 2.5 3,026 2.5 3,076 2.5 Total $ 124,538 100.0 % $ 121,950 100.0 % $ 120,734 100.0 % Consumer Loan Concentration Loan concentrations may exist when multiple borrowers could be similarly impacted by economic or other conditions. The following table summarizes state concentrations greater than 5.0% of consumer loans based on customer address: Table 45 Consumer Loans - Geography dollars in millions June 30, 2026 March 31, 2026 December 31, 2025 State California $ 7,764 29.3 % $ 7,950 29.7 % $ 8,118 29.8 % North Carolina 6,672 25.2 6,695 25.0 6,736 24.8 South Carolina 3,452 13.0 3,471 13.0 3,502 12.9 Massachusetts 1,498 5.7 1,486 5.6 1,597 5.9 Other states 7,110 26.8 7,140 26.7 7,243 26.6 Total $ 26,496 100.0 % $ 26,742 100.0 % $ 27,196 100.0 % Market Risk Market risk is the risk arising from changes in interest rates, foreign exchange, fixed income, commodity, or equity prices which can result in financial loss, or adverse impact to earnings and capital. Interest rate risk management BancShares is exposed to the risk that changes in market conditions may affect interest rates and negatively impact earnings. The risk arises from the nature of BancShares’ business activities, the composition of BancShares’ balance sheet, and changes in the level or shape of the yield curve. BancShares manages this inherent risk strategically based on prescribed guidelines and approved limits. Interest rate risk can arise from many of BancShares’ business activities, such as lending, leasing, investing, deposit taking, derivatives, and funding activities. We evaluate and monitor interest rate risk primarily through two metrics. •Net Interest Income Sensitivity (“NII Sensitivity”) measures the net impact of hypothetical changes in interest rates on forecasted NII; and •Economic Value of Equity (“EVE”) Sensitivity (“EVE Sensitivity”) measures the net impact of these hypothetical changes on the value of equity by assessing the economic value of assets, liabilities and off-balance sheet instruments. BancShares uses a holistic process to measure and monitor both short term and long term risks, which includes, but is not limited to, gradual and immediate parallel rate shocks, changes in the shape of the yield curve, and changes in the relationship of various yield curves. NII Sensitivity generally focuses on shorter term earnings risk, while EVE Sensitivity assesses the longer-term risk of the existing balance sheet. 97 Our exposure to NII Sensitivity is guided by the Risk Appetite Policy and Statement and a range of risk metrics, and BancShares may utilize tools across the balance sheet to adjust its interest rate risk exposures, including through business line actions and actions within the investment, funding and derivative portfolios. The composition of our interest rate sensitive assets and liabilities generally results in a net asset-sensitive position for NII Sensitivity, whereby our assets will reprice faster than our liabilities. A component of our interest rate risk management strategy is the use of derivative instruments to mitigate fluctuations in earnings caused by changes in market interest rates. Interest rate swaps are the primary type of derivative instrument that we use as part of our interest rate risk management strategy. These derivatives hedge interest income variability of floating rate loans indexed to secured overnight financing rate (“SOFR”), as well as fair value changes of fixed rate long-term debt. Refer to Note 11—Derivative Financial Instruments for further information on our derivative portfolio. Our funding sources consist primarily of deposits, and we also support our funding needs through wholesale funding sources (including unsecured and secured borrowings). The deposit rates we offer are influenced by market conditions and competitive factors. Market rates are the key factors of deposit costs, and we continue to optimize deposit costs by improving our deposit mix. Changes in interest rates, expected funding needs, as well as actions by competitors, can affect our deposit taking activities and deposit pricing. We believe our targeted non-maturity deposit customer retention is strong and we remain focused on optimizing our mix of deposits. We regularly assess the effect of deposit rate changes on our balances and seek to achieve optimal alignment between assets and liabilities. The following table summarizes the results of 12-month NII Sensitivity simulations produced by our asset/liability management system. These simulations assume static balance sheet replacement with like products and implied forward market rates, and also incorporate additional internal models and assumptions, which we may update periodically, including rate dependent prepayment for certain loans and securities and repricing of interest-bearing non-maturity deposits. The below simulations assume an immediate 100 and 200 bps parallel increase and decrease from current interest rates. Table 46 NII Sensitivity Simulation Analysis Estimated (Decrease) Increase in NII Change in interest rate (bps) June 30, 2026 March 31, 2026 December 31, 2025 -200 (9.5) % (12.1) % (11.3) % -100 (5.6) (6.4) (5.8) +100 6.4 6.7 6.5 +200 12.5 14.0 13.6 NII Sensitivity metrics at June 30, 2026, compared to December 31, 2025, were primarily affected by increased derivative hedges, prepayments on the Purchase Money Note, as well as other balance sheet compositional and market rate changes. As of June 30, 2026, BancShares continues to have an asset sensitive interest rate risk profile and the potential exposure to forecasted earnings was largely due to the composition of the balance sheet (primarily due to floating rate commercial loans and cash), as well as estimates of modest future deposit betas. 66.5% of our loans have floating contractual reference rates, indexed primarily to SOFR and the U.S. prime rate. Deposit betas are currently modeled to have a portfolio average of 35%-40% over the twelve-month forecast horizon, including 45%-50% for interest-bearing non-maturity deposits. Deposit beta is the portion of a change in the federal funds rate that is passed on to the deposit rate. Actual deposit betas may be different than modeled, depending on various factors, including liquidity requirements, deposit mix and competitive pressures. Impacts to NII Sensitivity may change due to actual results differing from modeled expectations. As noted above, EVE Sensitivity supplements NII simulations as it estimates risk exposures beyond a twelve-month horizon. EVE Sensitivity measures the change in EVE due to changes in assets, liabilities, and off-balance sheet instruments in response to a change in interest rates. EVE Sensitivity was calculated by estimating the change in the net present value of assets, liabilities, and off-balance sheet items under various rate movements, including utilizing a dynamic rate level dependent modeling approach for our deposit attrition assumption. In addition to interest rate changes, other key assumptions used in our EVE Sensitivity simulations include asset prepayments, as well as balance attrition and pricing of non-maturity deposits. 98 The below simulations assume an immediate 100 and 200 bps parallel increase and decrease from current interest rates and the estimated impact on our EVE profile based on our current modeling approach: Table 47 EVE Modeling Analysis Estimated Increase (Decrease) in EVE Change in interest rate (bps) June 30, 2026 March 31, 2026 December 31, 2025 -200 6.1 % 7.2 % 6.7 % -100 3.5 4.4 4.3 +100 (4.0) (4.3) (4.2) +200 (8.0) (7.8) (8.2) In addition to the above reported sensitivities, a wide variety of potential interest rate scenarios are simulated within our asset/liability management system. Scenarios that impact balance sheet composition or the sensitivity to key assumptions are also evaluated. We use results of our various interest rate risk analyses to formulate and implement asset and liability management strategies, in coordination with the Asset and Liability Committee, to achieve the desired risk profile, while managing our objectives for market risk and other strategic objectives. Specifically, we may manage our interest rate risk position through certain pricing strategies and product design for loans and deposits, our investment portfolio, funding portfolio, or by using derivatives to mitigate earnings volatility. The above sensitivities provide an estimate of our interest rate sensitivity; however, they do not account for potential changes in credit quality, size, mix, or changes in the competition for business in the industries we serve. They also do not account for other business developments and other actions. Accordingly, we can give no assurance that actual results would not differ materially from the estimated outcomes of our simulations. Loan Maturity and Loan Interest Rate Sensitivity The following table provides loan maturity distribution information: Table 48 Loan Maturity Distribution dollars in millions At June 30 2026, Maturing Within One Year One to Five Years Five to 15 Years After 15 Years Total Commercial Commercial and industrial $ 12,938 $ 28,366 $ 4,452 $ 818 $ 46,574 Capital call lines 33,992 211 — — 34,203 Owner occupied commercial mortgage 2,270 9,623 5,685 326 17,904 Investor dependent 1,108 1,516 — — 2,624 Commercial real estate 6,539 12,897 2,622 1,175 23,233 Total commercial 56,847 52,613 12,759 2,319 124,538 Consumer Residential mortgage 826 2,802 7,738 10,200 21,566 Revolving mortgage 49 176 1,132 1,511 2,868 Consumer auto 323 851 87 — 1,261 Consumer other 204 485 107 5 801 Total consumer 1,402 4,314 9,064 11,716 26,496 Total loans and leases $ 58,249 $ 56,927 $ 21,823 $ 14,035 $ 151,034 As noted above, 66.5% of our total loans have floating contractual reference rates, indexed primarily to SOFR and the U.S. prime rate. The following table provides information regarding fixed and variable interest rate loans and leases maturing one year or after, as of June 30, 2026: 99 Table 49 Fixed and Variable Interest Rate Loans dollars in millions Loans Maturing One Year or After with Fixed Interest Rates Variable Interest Rates Commercial Commercial and industrial $ 9,703 $ 23,933 Capital call lines — 211 Owner occupied commercial mortgage 13,860 1,774 Investor dependent 7 1,509 Commercial real estate 7,540 9,154 Total commercial 31,110 36,581 Consumer Residential mortgage 8,120 12,620 Revolving mortgage 21 2,798 Consumer auto 938 — Consumer other 281 316 Total consumer 9,360 15,734 Total loans and leases $ 40,470 $ 52,315 Liquidity Risk Liquidity risk is the risk arising from BancShares being unable to meet its obligations as they come due because of an inability to: (i) liquidate assets or obtain adequate funding, or (ii) unwind or offset specific exposures without significantly lowering market prices because of inadequate market depth or market disruptions. This may result in impairment of safety and soundness. Our liquidity risk management and monitoring process is designed to ensure the availability of adequate cash and collateral resources and funding capacity to meet our obligations. Our overall liquidity management strategy is intended to ensure appropriate liquidity to meet expected and contingent funding needs under both normal and stressed environments. Consistent with this strategy, we maintain sufficient amounts of available cash and HQLS. Additional sources of liquidity include committed credit facilities, repurchase agreements, brokered certificates of deposit issuances, unsecured debt issuances, cash collections generated by portfolio asset sales to third parties and securitizations. We utilize measurement tools to assess and monitor the level and adequacy of our liquidity position, liquidity conditions and trends. We measure and forecast liquidity and liquidity risks under different hypothetical scenarios and across different horizons. We use a liquidity stress testing framework to better understand the range of potential risks and their impacts to which BancShares is exposed. Stress test results inform our business strategy, risk appetite, levels of liquid assets, and contingency funding plans. Also included among our liquidity measurement tools are key risk indicators that assist in identifying potential liquidity risk and stress events. BancShares maintains a framework to establish liquidity risk tolerances, monitoring, and breach escalation protocol to alert management of potential funding and liquidity risks and to initiate mitigating actions as appropriate. Further, BancShares maintains a contingent funding plan, which details protocols and potential actions to be taken under liquidity stress conditions. Liquidity includes available cash and HQLS. At June 30, 2026 we had $59.14 billion of high-quality liquid assets (25.0% of total assets) and $30.52 billion of contingent liquidity sources available. Some of the more significant changes from December 31, 2025 included higher available cash and HQLS due to balance sheet changes discussed above in “Executive Overview—Financial Performance Summary—Balance Sheet Highlights.” 100 Table 50 Liquidity dollars in millions June 30, 2026 March 31, 2026 December 31, 2025 Available cash $ 20,180 $ 22,142 $ 19,111 High-quality liquid securities (1) 38,958 38,580 36,895 High-quality liquid assets $ 59,138 $ 60,722 $ 56,006 Current Capacity (2) of Credit Facilities: FHLB facility (3) $ 17,750 $ 17,349 $ 17,775 FRB facility 12,772 12,944 12,962 Total contingent sources $ 30,522 $ 30,293 $ 30,737 Total liquid assets and contingent sources $ 89,660 $ 91,015 $ 86,743 Total uninsured deposits $ 65,060 $ 65,439 $ 61,809 Coverage ratio of total liquid assets and contingent sources to uninsured deposits 138 % 139 % 140 % (1) Consists of readily marketable, unpledged securities, as well as securities pledged but not drawn against at the FHLB and available for sale, and generally is comprised of U.S. Treasury and U.S. agency investment securities held outright or via reverse repurchase agreements. (2) Current capacity is based on the amount of collateral pledged and available for use at June 30, 2026, March 31, 2026, and December 31, 2025. (3) Refer to Table 51 for additional details. We fund our operations through deposits and borrowings. Our primary source of liquidity is derived from our various deposit channels, including our Branch Network and Direct Bank. Total deposits at June 30, 2026 were $173.43 billion, an increase of $11.85 billion or 7% from $161.58 billion at December 31, 2025. Funding mix improved as deposits represented 84.3% of total funding at June 30, 2026 compared to 81.8% at December 31, 2025. We use borrowings to diversify the funding of our business operations. In addition to the Purchase Money Note and FHLB advances, borrowings also include senior unsecured notes, securities sold under customer repurchase agreements, and subordinated notes. Total borrowings at June 30, 2026 were $32.19 billion, a decrease of $3.82 billion or 11% from $36.01 billion at December 31, 2025. Refer to details of debt prepayments and issuances in the “Executive Overview—Recent Events” section of this MD&A. We continually monitor our capital needs and market conditions in an effort to diversify our borrowing base and capital mix when appropriate. FHLB Capacity A source of available funds is advances from the FHLB of Atlanta. We may pledge assets for secured borrowing transactions, which include borrowings from the FHLB or FRB, or for other purposes as required or permitted by law. The debt issued in conjunction with these transactions is collateralized by certain discrete receivables, securities, loans, leases and underlying equipment. Certain related cash balances are restricted. Table 51 FHLB Balances dollars in millions June 30, 2026 March 31, 2026 December 31, 2025 Total borrowing capacity $ 19,200 $ 18,799 $ 19,225 Less: Advances — — — Letters of credit (1) 1,450 1,450 1,450 Available capacity $ 17,750 $ 17,349 $ 17,775 Pledged Non-PCD loans $ 31,820 $ 31,368 $ 31,713 (1) Letters of credit were established with the FHLB to collateralize public funds. FRB Capacity Under borrowing arrangements with the FRB, FCB has access to $12.77 billion on a secured basis at June 30, 2026. Loans pledged are disclosed in Note 5—Loans and Leases. There were no outstanding borrowings with the FRB Discount Window at June 30, 2026 and December 31, 2025. Contractual Obligations and Commitments The following table includes significant contractual obligations and commitments as of June 30, 2026, representing required and potential cash outflows, including impacts from purchase accounting adjustments and deferred fees. Refer to Note 19—Commitments and Contingencies for additional information regarding commitments. Financing commitments, letters of credit and deferred purchase commitments are presented at contractual amounts and do not necessarily reflect future cash outflows, as many are expected to expire unused or partially used. 101 Table 52 Contractual Obligations and Commitments dollars in millions Payments Due by Period Less than 1 year 1-3 years 4-5 years Thereafter Total Contractual obligations: Time deposits $ 14,868 $ 221 $ 38 $ — $ 15,127 Short-term borrowings 152 — — — 152 Long-term borrowings (1) (2) (33) 28,870 1,232 1,967 32,036 Total contractual obligations $ 14,987 $ 29,091 $ 1,270 $ 1,967 $ 47,315 Commitments: Financing commitments $ 26,716 $ 10,145 $ 8,492 $ 7,505 $ 52,858 Letters of credit 2,129 567 177 86 2,959 Deferred purchase agreements 1,487 — — — 1,487 Purchase and funding commitments 103 — — — 103 Affordable housing partnerships (1) 613 486 26 41 1,166 Total commitments $ 31,048 $ 11,198 $ 8,695 $ 7,632 $ 58,573 (1) Long-term borrowings are presented net of purchase accounting adjustments of $50 million. On-balance sheet commitments for affordable housing partnerships are included in other liabilities and presented net of a purchase accounting adjustment of $9 million. (2) Balance in parenthesis represents the estimated amortization of the purchase accounting adjustment and deferred costs in excess of any principal balance. Long-term Borrowings As displayed above in Table 52, we do not have any significant long-term debt obligations due until the Purchase Money Note matures. While scheduled principal payments are not required until maturity in March 2028, FCB may voluntarily prepay principal without a premium or penalty. As noted earlier in “Executive Overview—Recent Events,” FCB made prepayments of the Purchase Money Note in the second quarter of 2026 totaling $2.50 billion ($5.00 billion for the current YTD period) and previously made a prepayment of $2.49 billion in December 2025. We will continue to monitor the interest rate environment, FCB’s collateral position for the Purchase Money Note, and FCB’s liquidity position to determine the timing and magnitude of further voluntary prepayments. We expect monthly prepayments to be at least $500 million throughout 2026. In the third quarter of 2026, we expect total prepayments of $6 billion to $8 billion, largely driven by expected liquidity from the BMO Branch Acquisition. Potential sources that could fund voluntary prepayments or the amount due at maturity include excess liquidity (primarily comprised of interest-earning deposits at banks and proceeds from maturities and paydowns of investment securities), deposit growth including brokered deposits and deposits to be assumed in the BMO Branch Acquisition, loan sales or securitizations, FHLB advances, and issuance of perpetual preferred stock, unsecured debt or other borrowings. At the time of any further voluntary prepayment or maturity, the interest rates for the potential interest-bearing sources of prepayment could be higher than the 3.50% rate. Refer to the respective “Deposits” and “Borrowings” discussions in the “Balance Sheet Analysis—Interest-bearing Liabilities” section of this MD&A for further details. CAPITAL Capital requirements applicable to BancShares are discussed in the “Regulatory Considerations” section in Item 1. Business of the 2025 Form 10-K. Common and Preferred Stock Dividends During the current quarter, we paid quarterly dividends of $2.10 per share on the Class A common stock and Class B common stock. In July 2026, the Board declared a quarterly dividend on the Class A common stock and Class B common stock of $2.10 per common share. The dividends are payable on September 15, 2026 to stockholders of record as of August 31, 2026. During the current quarter, we paid quarterly dividends on our Series A, Series B, Series C, Series D, and Series E Preferred Stock as disclosed in Note 13—Stockholders' Equity. In July 2026, the Board declared dividends on our Series A, Series B, Series C, Series D, and Series E Preferred Stock in accordance with their terms. The dividends are payable on September 15, 2026. Capital Composition and Ratios As discussed earlier in the “Executive Overview—Recent Events” section of this MD&A, during the current quarter and current YTD, we repurchased 298,907 and 748,752 shares of our Class A common stock, respectively. Refer to Part II, Item 2. Unregistered Sales of Equity Securities and Use of Proceeds for additional information regarding repurchases of Class A common stock, including current quarter monthly repurchase activity. 102 The following table summarizes the change in outstanding Class A common stock through June 30, 2026. Refer to Note 13—Stockholders' Equity for additional information. Table 53 Changes in Shares of Class A Common Stock Outstanding Three Months Ended June 30, 2026 Six Months Ended June 30, 2026 Class A common stock shares outstanding at beginning of period 10,684,129 11,133,974 Shares repurchased under authorized repurchase plan (298,907) (748,752) Class A common stock shares outstanding at end of period 10,385,222 10,385,222 We also had 1,005,185 Class B common stock outstanding at June 30, 2026 and December 31, 2025. We are committed to effectively managing our capital to protect our depositors, creditors and stockholders. We continually monitor the capital levels and ratios for BancShares and FCB to ensure they exceed the minimum requirements imposed by regulatory authorities and to ensure they are appropriate given growth projections, risk profile and potential changes in the regulatory or external environment. Failure to meet certain capital requirements may result in actions by regulatory agencies that could have a material impact on our operations or consolidated financial statements. In accordance with GAAP, the unrealized gains and losses on certain assets and liabilities, net of deferred taxes, are included in AOCI within stockholders’ equity. These amounts are excluded from the calculation of our regulatory capital ratios under current regulatory guidelines. Refer to details of Basel III proposals in the “Executive Overview—Recent Events” section of this MD&A. Table 54 Analysis of Capital Adequacy dollars in millions Basel III Requirements PCA Well Capitalized Thresholds June 30, 2026 March 31, 2026 December 31, 2025 Amount Ratio Amount Ratio Amount Ratio BancShares Risk-based capital ratios Total risk-based capital 10.50 % 10.00 % $ 24,680 13.37 % $ 24,799 13.51 % $ 24,945 13.71 % Tier 1 risk-based capital 8.50 8.00 21,650 11.73 21,634 11.79 21,660 11.91 Common equity Tier 1 7.00 6.50 19,885 10.77 19,869 10.83 20,285 11.15 Tier 1 leverage ratio 4.00 5.00 21,650 9.22 21,634 9.30 21,660 9.29 FCB Risk-based capital ratios Total risk-based capital 10.50 % 10.00 % $ 24,568 13.34 % $ 24,892 13.59 % $ 24,739 13.62 % Tier 1 risk-based capital 8.50 8.00 22,858 12.41 23,064 12.59 22,796 12.55 Common equity Tier 1 7.00 6.50 22,858 12.41 23,064 12.59 22,796 12.55 Tier 1 leverage ratio 4.00 5.00 22,858 9.75 23,064 9.93 22,796 9.79 As of June 30, 2026, BancShares and FCB had total risk-based capital ratio conservation buffers of 5.37% and 5.34%, respectively, which are in excess of the Basel III conservation buffer of 2.50%. As of December 31, 2025, BancShares and FCB’s total risk-based capital ratio conservation buffers were 5.71% and 5.62%, respectively. The capital ratio conservation buffers represent the excess of the regulatory capital ratios as of June 30, 2026 and December 31, 2025 over the Basel III minimum for the applicable ratio. Additional Tier 1 capital for BancShares includes perpetual preferred stock. Additional Tier 2 capital for BancShares and FCB primarily consists of qualifying ALLL and qualifying subordinated debt. 103 Dividend Restrictions Dividends paid from FCB to the Parent Company are the primary source of funds available to the Parent Company for payment of dividends to its stockholders. The Board of Directors of FCB may approve distributions, including dividends, as it deems appropriate, subject to the requirements of the FDIC and the General Statutes of North Carolina, provided that the distributions do not reduce the regulatory capital ratios below the applicable requirements. FCB could have paid additional dividends to the Parent Company in the amount of $6.15 billion while continuing to meet the requirements for well capitalized banks at June 30, 2026. Dividends declared by FCB and paid to the Parent Company amounted to $1.15 billion for the six months ended June 30, 2026. Payment of dividends is made at the discretion of FCB’s Board of Directors and may be contingent upon satisfactory earnings as well as projected capital needs. CRITICAL ACCOUNTING ESTIMATES The accounting and reporting policies of BancShares are described in Note 1—Significant Accounting Policies and Basis of Presentation in the 2025 Form 10-K. The ALLL is considered a critical accounting estimate. For more information regarding the ALLL, refer to the “Risk Management—Credit Risk—ALLL Methodology” section of this MD&A and Note 6—Allowance for Loan and Lease Losses. RECENT ACCOUNTING PRONOUNCEMENTS The following Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board are not yet effective for BancShares. Refer to Note 1—Significant Accounting Policies and Basis of Presentation for descriptions of ASUs that were adopted as of January 1, 2026. ASU Summary Effective Date and Expected Impact ASU 2024-03—Income Statement—Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses Issued November 2024 This ASU enhances expense disclosures, primarily by requiring footnote disaggregation of specified expenses in a tabular format. This ASU does not change the requirements for the presentation of expenses on the consolidated statements of income. This ASU is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. This ASU may be applied prospectively or retrospectively. We are currently evaluating the impact of this ASU on our notes to the consolidated financial statements. We do not plan to early adopt this ASU. ASU 2025-06—Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software Issued September 2025 This ASU amends certain aspects of the accounting for internal-use software. This ASU eliminated references to software development stages, which were previously determinants of whether internal-use software costs should be capitalized. This ASU also provided more specific criteria to assess when determining whether internal-use software costs should be capitalized. This ASU is effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period. This ASU may be applied using either a prospective, retrospective, or modified transition approach. We are currently evaluating the impact of this ASU on our consolidated financial statements. We did not early adopt this ASU on January 1, 2026, but are considering whether we may early adopt on January 1, 2027. ASU 2025-09—Derivatives and Hedging (Topic 815)—Hedge Accounting Improvements Issued November 2025 This ASU clarified certain aspects of hedge accounting to better reflect the economics of risk management activities. For example, this ASU eliminated the requirement that a group of interest payments be based on the same index in order to be hedged as a group, and provided more flexibility for grouping transactions with similar risks for cash flow hedges. This ASU is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted on any date on or after the issuance date of this ASU. Entities are required to apply this ASU on a prospective basis for all hedging relationships. We are currently evaluating the impact of this ASU on our consolidated financial statements and considering whether we may early adopt during 2026. 104 NON-GAAP FINANCIAL MEASUREMENTS BancShares provides certain non-GAAP information in reporting its financial results to give investors additional data to evaluate its operations. A non-GAAP financial measure is a numerical measure of a company’s historical or future financial performance or financial position that may either exclude or include amounts, or is adjusted in some way to the effect of including or excluding amounts, as compared to the most directly comparable measure calculated and presented in accordance with GAAP financial statements. BancShares’ management believes that non-GAAP financial measures, when reviewed in conjunction with GAAP financial information, can provide transparency about, or an alternate means of assessing, its operating results and financial position to its investors, analysts and management. These non-GAAP measures should be considered in addition to, and not superior to or a substitute for, GAAP measures presented in BancShares’ consolidated financial statements and other publicly filed reports. In addition, our non-GAAP measures may be different from or inconsistent with non-GAAP financial measures used by other institutions. Whenever we refer to a non-GAAP financial measure we will generally define and present the most directly comparable financial measure calculated and presented in accordance with GAAP, along with a reconciliation between the GAAP financial measure and the non-GAAP financial measure. We describe each of these measures below and explain why we believe the measure to be useful. Adjusted Rental Income on Operating Lease Equipment for Commercial Bank and Rail Segments Commercial Bank segment net income, rental income on operating lease equipment, and adjusted rental income on operating lease equipment are utilized to measure profitability. Adjusted rental income on operating lease equipment is a non-GAAP measure calculated as rental income on operating lease equipment less depreciation on operating lease equipment, as well as maintenance and other operating lease expenses, if any. This measure is meaningful because it enables management to monitor the performance and profitability of operating leases after deducting direct expenses. The following tables reconcile the most comparable GAAP measures to the non-GAAP measures for the Commercial Bank and Rail segments. Table 55 Commercial Bank Segment dollars in millions Three Months Ended Six Months Ended June 30, June 30, 2026 March 31, 2026 June 30, 2025 2026 2025 Rental income on operating leases (GAAP) $ 54 $ 55 $ 54 $ 109 $ 110 Less: depreciation on operating lease equipment 43 43 44 86 88 Adjusted rental income on operating lease equipment (non-GAAP) $ 11 $ 12 $ 10 $ 23 $ 22 Rail segment net income, rental income on operating lease equipment and adjusted rental income on operating lease equipment are utilized to measure profitability. Adjusted rental income on operating lease equipment is calculated as rental income on operating lease equipment reduced by depreciation, maintenance and other operating lease expenses. This measure is meaningful because it enables management to monitor the performance and profitability of operating leases after deducting direct expenses. Due to the nature of the Rail segment portfolio, which is essentially all operating lease equipment, certain financial measures commonly used by banks, such as NII, are not as meaningful for the Rail segment. NII is not used because it includes the impact of debt costs funding our operating lease assets but excludes the associated adjusted rental income. Table 56 Rail Segment dollars in millions Three Months Ended Six Months Ended June 30, June 30, 2026 March 31, 2026 June 30, 2025 2026 2025 Rental income on operating leases (GAAP) $ 226 $ 226 $ 218 $ 452 $ 432 Less: depreciation on operating lease equipment 58 58 56 116 110 Less: maintenance and other operating lease expenses 67 65 55 132 113 Adjusted rental income on operating lease equipment (non-GAAP) $ 101 $ 103 $ 107 $ 204 $ 209 105 NII, NIM, and Interest Income on Loans and Leases, Excluding PAA NII and NIM, excluding PAA, and interest income on loans and leases, excluding loan PAA are meaningful metrics as they allow management to analyze NII, NIM and loan and lease interest income trends more directly related to the rates of the underlying interest-earning assets and interest-bearing liabilities. Loan PAA is primarily related to the loan discount in the SVBB Acquisition. Other PAA is primarily related to the discount on the Purchase Money Note and the premium on deposits assumed in the merger with CIT Group Inc. The following table reconciles NII to NII, excluding PAA, NIM to NIM, excluding PAA, and interest income on loans and leases to interest income on loans and leases, excluding loan PAA: Table 57 NII, NIM, and Interest Income on Loans and Leases, Excluding PAA dollars in millions Three Months Ended Six Months Ended June 30, June 30, 2026 March 31, 2026 June 30, 2025 2026 2025 NII (GAAP) a $ 1,656 $ 1,621 $ 1,695 $ 3,277 $ 3,358 Loan PAA b 55 48 75 103 159 Other PAA c (7) (9) (9) (16) (17) PAA d = (b+c) 48 39 66 87 142 NII, excluding PAA (non-GAAP) e = (a-d) $ 1,608 $ 1,582 $ 1,629 $ 3,190 $ 3,216 Annualized NII f = a annualized $ 6,642 $ 6,575 $ 6,800 $ 6,609 $ 6,772 Annualized NII, excluding PAA (non-GAAP) g = e annualized 6,451 6,416 6,533 6,434 6,486 Average interest-earning assets h $ 213,990 $ 212,552 $ 208,175 $ 213,276 $ 207,108 NIM (GAAP) f/h 3.10 % 3.09 % 3.26 % 3.09 % 3.26 % NIM, excluding PAA (non-GAAP) g/h 3.01 3.01 3.14 3.01 3.13 Interest income on loans and leases (GAAP) $ 2,253 $ 2,206 $ 2,270 $ 4,459 $ 4,506 Less: loan PAA b 55 48 75 103 159 Interest income on loans and leases, excluding loan PAA (non-GAAP) $ 2,198 $ 2,158 $ 2,195 $ 4,356 $ 4,347 106 Forward-Looking Statements Statements in this Quarterly Report on Form 10-Q contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 regarding the financial condition, results of operations, business plans, asset quality, future performance, and other strategic goals of BancShares. Words such as “anticipates,” “believes,” “estimates,” “expects,” “predicts,” “forecasts,” “intends,” “plans,” “projects,” “targets,” “designed,” “could,” “may,” “should,” “will,” “potential,” “continue,” “aims,” or other similar words and expressions are intended to identify these forward-looking statements. These forward-looking statements are based on BancShares’ current expectations and assumptions regarding BancShares’ business, the economy, and other future conditions. Because forward-looking statements relate to future results and occurrences, they are subject to inherent risks, uncertainties, changes in circumstances and other factors that are difficult to predict. Many possible events or factors could affect BancShares’ future financial results and performance and could cause actual results, performance or achievements of BancShares to differ materially from any anticipated results expressed or implied by such forward-looking statements. Such risks and uncertainties include, among others, general competitive, economic (including the imposition of tariffs, retaliatory tariff measures, trade barriers on trading partners, and supply chain disruptions), political (including impacts of any U.S. government shutdown), geopolitical events (including conflicts or developments in Ukraine, the Middle East, and Latin America), natural disasters and market conditions, including changes in competitive pressures among financial institutions and the impacts related to or resulting from previous bank failures, the risks and impacts of future bank failures and other volatility in the banking industry, public perceptions of our business practices, including our deposit pricing and acquisition activity, the financial success or changing conditions or strategies of BancShares’ vendors or customers, including changes in demand for deposits, loans and other financial services, fluctuations in interest rates, changes in the quality or composition of BancShares’ loan or investment portfolio, actions of government regulators, including interest rate decisions by the Federal Reserve, changes to estimates of future costs and benefits of actions taken by BancShares, BancShares’ ability to maintain adequate sources of funding and liquidity, the potential impact of decisions by the Federal Reserve on BancShares’ capital plans, adverse developments with respect to U.S. or global economic conditions, including significant turbulence in the capital or financial markets, the impact of any sustained or elevated inflationary environment, the impact of any cyberattack, information or security breach, the effect of technological change, including artificial intelligence and digital assets, the impact of implementation and compliance with current or proposed laws, regulations and regulatory interpretations, including potential increased regulatory requirements, limitations, and costs, such as FDIC special assessments, increases to FDIC deposit insurance premiums, changes in regulatory capital requirements, or limitations on credit card interest rates, along with the risk that such laws, regulations and regulatory interpretations may change, the availability of capital and personnel, changes or enhancements BancShares implements with respect to risk management, technology, personnel, financial service offerings, or other areas, and the risks associated with BancShares’ previously completed acquisition transactions, the pending BMO Branch Acquisition, or any future transactions. BancShares’ 2025 SRP allows BancShares to repurchase shares of its Class A common stock through 2026. BancShares is not obligated under the 2025 SRP to repurchase any minimum or particular number of shares, and repurchases may be suspended or discontinued at any time (subject to the terms of any Rule 10b5-1 plan in effect) without prior notice. The authorization to repurchase Class A common stock pursuant to the 2025 SRP will be utilized at management’s discretion. The actual timing and amount of Class A common stock that may be repurchased under the plan will depend on a number of factors, including the terms of any Rule 10b5-1 plan then in effect, price, general business and market conditions, regulatory requirements, and alternative investment opportunities or capital needs. Except to the extent required by applicable laws or regulations, BancShares disclaims any obligation to update forward-looking statements or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments. Additional factors which could affect the forward-looking statements may be included in BancShares’ other filings with the Securities and Exchange Commission. 107