The Bank is subject to various regulatory capital requirements administered by federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary, actions by regulators

that, if undertaken, could have a direct material effect on the Company’s Consolidated Financial Statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The Bank’s and consolidated Company’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weighting and other factors.

The minimum capital level requirements include: (i) a Tier 1 leverage ratio of 4%; (ii) common equity Tier 1 risk weighted capital ratio of 4.5%; (iii) a Tier 1 risk weighted capital ratio of 6%; and (iv) a total risk weighted capital ratio of 8% for all institutions. The Bank is also required to maintain a “capital conservation buffer” of 2.5% above the regulatory minimum capital ratios which results in the following minimum ratios: (i) a common equity Tier 1 risk weighted capital ratio of 7.0%; (ii) a Tier 1 risk weighted capital ratio of 8.5%; and (iii) a total risk weighted capital ratio of 10.5%. An institution will be subject to limitations on paying dividends, engaging in share repurchases and paying discretionary bonuses if its capital level falls below the buffer amount. These limitations will establish a maximum percentage of eligible retained income that could be utilized for such actions.

As the Company’s consolidated assets now exceed $3 billion, it no longer qualifies for the Federal Reserve’s Small Bank Holding Company Policy Statement. Accordingly, the Company is subject to the Federal Reserve’s consolidated capital requirements applicable to bank holding companies.

The following table shows information regarding the Company’s and the Bank’s regulatory capital levels at June 30, 2026 and at December 31, 2025, as if the Company were subject to minimum capital requirements.


	Actual					Required for Capital Adequacy Purposes					To be Well Capitalized Under Prompt Corrective Action Regulations *
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
As of June 30, 2026
Total risk-based capital (to risk-weighted assets)
Company Consolidated	$	413,850		15.82	%	$	209,245		8.00	%	$	261,556		10.00	%
Bank		404,120		15.52			208,351		8.00			260,439		10.00
Common equity tier 1 (to risk-weighted assets)
Company Consolidated		371,123		14.19			117,700		4.50			170,012		6.50
Bank		371,530		14.27			117,198		4.50			169,285		6.50
Tier 1 capital (to risk-weighted assets)
Company Consolidated		381,123		14.57			156,934		6.00			209,245		8.00
Bank		371,530		14.27			156,263		6.00			208,351		8.00
Tier 1 capital (to average total assets)
Company Consolidated		381,123		13.17			115,758		4.00			144,697		5.00
Bank		371,530		12.88			115,343		4.00			144,179		5.00

As of December 31, 2025
Total risk-based capital (to risk-weighted assets)
Company Consolidated	$	385,054		16.12	%	$	191,088		8.00	%	$	238,860		10.00	%
Bank		374,667		15.70			190,922		8.00			238,652		10.00
Common equity tier 1 (to risk-weighted assets)
Company Consolidated		345,158		14.45			107,487		4.50			155,259		6.50
Bank		344,796		14.45			107,393		4.50			155,124		6.50
Tier 1 capital (to risk-weighted assets)
Company Consolidated		355,158		14.87			143,316		6.00			191,088		8.00
Bank		344,796		14.45			143,191		6.00			190,922		8.00
Tier 1 capital (to average total assets)
Company Consolidated		355,158		12.72			111,698		4.00			139,622		5.00
Bank		344,796		12.39			111,305		4.00			139,131		5.00

*Prompt Corrective Action requirements only apply to the Bank.

NOTE 10. Regulatory Capital