PRIMIS FINANCIAL CORP._September 30, 2025

Please wait

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended September 30, 2025

Commission File No. 001-33037

PRIMIS FINANCIAL CORP.

(Exact name of registrant as specified in its charter)


Virginia	20-1417448
(State or other jurisdiction	(I.R.S. Employer Identification No.)
of incorporation or organization)

1676 International Drive, Suite 900

McLean, Virginia 22102

(Address of principal executive offices) (zip code)

(703) 893-7400

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class:	Trading symbol	Name of each exchange on which registered:
Common Stock, par value $0.01 per share	FRST	NASDAQ Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b–2 of the Exchange Act:


Large accelerated filer ☐	Accelerated filer ☒	Smaller reporting company ☐

Non-accelerated filer ☐	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

As of October 31, 2025, there were 24,644,385 shares of common stock, $0.01 par value, outstanding.

Table of Contents

PRIMIS FINANCIAL CORP.

FORM 10-Q

September 30, 2025

TABLE OF CONTENTS		PAGE
PART I - FINANCIAL INFORMATION

Item 1 - Financial Statements		4

Condensed Consolidated Balance Sheets as of September 30, 2025 and December 31, 2024		4
Condensed Consolidated Statements of Income and Comprehensive Income for the three and nine months ended September 30, 2025 and 2024		5
Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three and nine months ended September 30, 2025 and 2024		6
Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2025 and 2024		7
Notes to Unaudited Condensed Consolidated Financial Statements		8

Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations		46

Item 3 – Quantitative and Qualitative Disclosures about Market Risk		77

Item 4 – Controls and Procedures		79

PART II - OTHER INFORMATION

Item 1 – Legal Proceedings		80

Item 1A – Risk Factors		80

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds		80

Item 3 – Defaults Upon Senior Securities		80

Item 4 – Mine Safety Disclosures		81

Item 5 – Other Information		81

Item 6 - Exhibits		82

Signatures		84

Table of Contents

GLOSSARY OF ACRONYMS AND DEFINED TERMS

In this Quarterly Report on Form 10-Q, except as otherwise indicated or the context suggests otherwise, references to the “Company” refers to Primis Financial Corp., and the terms “Primis”, “we”, “us” and “our” refer to the Company and its subsidiaries, including Primis Bank, which we refer to as “Primis Bank” or the “Bank.”

“PMC” refers to Primis Mortgage Company, a residential mortgage lender headquartered in Wilmington, North Carolina, a consolidated subsidiary of Primis Bank.

“PFH” refers to Panacea Financial Holdings, Inc., headquartered in Little Rock, Arkansas, which owns the rights to the Panacea Financial brand and its intellectual property and partners with the Bank to offer a suite of financial products and services for doctors, their practices, and the broader healthcare industry.



ACL	Allowance for credit losses
AFS	Available-for-sale
ALCO	Asset-Liability Committee
ASC	Accounting Standards Codification
ASU	Accounting Standards Update
Basel III	Basel Committee's 2010 Regulatory Capital Framework
CECL	Current expected credit losses
CEO	Chief Executive Officer
CFO	Chief Financial Officer
DEI	Diversity, equity and inclusion
Dodd-Frank Act	Dodd-Frank Wall Street Reform and Consumer Protection Act
EPS	Earnings per share
ESG	Environmental, social and governance
EVE	Economic value of equity
FASB	Financial Accounting Standards Board
FDIC	Federal Deposit Insurance Corporation
FHLB	Federal Home Loan Bank of Atlanta
FRB	Federal Reserve Bank
FOMC	Federal Open Market Committee
FVO	Fair value option
GAAP	U.S. generally accepted accounting principles
HTM	Held-to-maturity
IRLC	Interest rate lock commitments
LHFI	Loans held for investment
LHFS	Loans held for sale
NII	Net interest income
NASDAQ	National Association of Securities Dealers Automated Quotations
PCA	Prompt corrective action
PCD	Purchased credit deteriorated
PPP	Paycheck Protection Program
SEC	Securities and Exchange Commission
SOFR	Secured Overnight Financing Rate
VIE	Variable interest entity

Table of Contents

PART I - FINANCIAL INFORMATION

ITEM 1 - FINANCIAL STATEMENTS

PRIMIS FINANCIAL CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS

(dollars in thousands, except per share amounts)


	September 30,		December 31,
	2025		2024
	(unaudited)
ASSETS
Cash and cash equivalents:
Cash and due from financial institutions	$	7,692	$	8,059
Interest-bearing deposits in other financial institutions		56,189		56,446
Total cash and cash equivalents		63,881		64,505
Securities available-for-sale, at fair value (amortized cost of $252,991 and $262,632, respectively)		234,660		235,903
Securities held-to-maturity, at amortized cost (fair value of $8,037 and $8,602, respectively)		8,550		9,448
Loans held for sale, at fair value		148,781		83,276
Loans held for sale, at lower of cost or market		53,591		163,832
Total loans held for sale		202,372		247,108
Loans held for investment, collateralizing secured borrowings		15,476		17,287
Loans held for investment		3,184,758		2,870,160
Less: allowance for credit losses		(44,766)		(53,724)
Net loans		3,155,468		2,833,723
Stock in Federal Reserve Bank and Federal Home Loan Bank		17,035		13,037
Bank premises and equipment, net		19,380		19,432
Assets held for sale		775		5,497
Operating lease right-of-use assets		9,427		10,279
Cloud computing arrangement assets, net		6,017		8,065
Goodwill		93,459		93,459
Intangible assets, net		43		665
Bank-owned life insurance		68,504		67,184
Deferred tax assets, net		17,328		26,466
Consumer Program derivative asset		409		4,511
Investment in Panacea Financial Holdings, Inc. common stock		6,880		—
Other assets		50,661		50,833
Total assets	$	3,954,849	$	3,690,115

LIABILITIES AND STOCKHOLDERS' EQUITY
Noninterest-bearing demand deposits	$	489,728	$	438,917
Interest-bearing deposits:
NOW accounts		831,709		817,715
Money market accounts		737,634		798,506
Savings accounts		958,416		775,719
Time deposits		318,865		340,178
Total interest-bearing deposits		2,846,624		2,732,118
Total deposits		3,336,352		3,171,035
Securities sold under agreements to repurchase		3,954		3,918
Secured borrowings		15,403		17,195
FHLB advances		85,000		—
Junior subordinated debt		9,917		9,880
Senior subordinated notes		86,174		85,998
Operating lease liabilities		10,682		11,566
Other liabilities		25,214		25,541
Total liabilities		3,572,696		3,325,133
Commitments and contingencies (See Note 9)
Stockholders' equity:
Preferred stock, $0.01 par value. Authorized 5,000,000 shares; no shares issued and outstanding		—		—
Common stock, $0.01 par value. Authorized 45,000,000 shares; 24,723,934 shares issued and 24,644,385 shares outstanding at September 30, 2025, and 24,722,734 shares issued and outstanding at December 31, 2024		247		247
Additional paid in capital		314,770		314,694
Retained earnings		82,541		58,047
Treasury stock, at cost. 79,549 shares at September 30, 2025		(807)		—
Accumulated other comprehensive loss		(14,598)		(21,232)
Total Primis stockholders' equity		382,153		351,756
Noncontrolling interests		—		13,226
Total stockholders' equity		382,153		364,982
Total liabilities and stockholders' equity	$	3,954,849	$	3,690,115

See accompanying notes to unaudited condensed consolidated financial statements.

Table of Contents

PRIMIS FINANCIAL CORP.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(dollars in thousands, except per share amounts) (Unaudited)



	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2025		2024		2025		2024
Interest and dividend income:
Interest and fees on loans	$	48,857	$	54,296	$	138,538	$	151,581
Interest and dividends on taxable securities		1,808		1,702		5,450		5,022
Interest and dividends on tax exempt securities		86		97		278		297
Interest and dividends on other earning assets		1,015		1,017		2,850		2,756
Total interest and dividend income		51,766		57,112		147,116		159,656
Interest expense:
Interest on deposits		20,571		25,351		60,460		72,987
Interest on other borrowings		2,163		3,738		6,080		8,524
Total interest expense		22,734		29,089		66,540		81,511
Net interest income		29,032		28,023		80,576		78,145
Provision for (recovery of) credit losses		(49)		7,511		9,850		17,138
Net interest income after provision for (recovery of) credit losses		29,081		20,512		70,726		61,007

Noninterest income:
Account maintenance and deposit service fees		1,358		1,468		4,372		4,722
Income from bank-owned life insurance		456		431		1,319		1,975
Gains on Panacea Financial Holdings investment		294		—		32,322		—
Mortgage banking income		8,887		6,803		22,395		18,779
Gains on sale of loans		249		—		459		307
Gains on other investments		381		51		126		393
Consumer Program derivative income		264		79		565		3,392
Other noninterest income		80		450		776		873
Total noninterest income		11,969		9,282		62,334		30,441

Noninterest expenses:
Salaries and benefits		18,523		16,764		53,524		48,587
Occupancy expenses		1,575		1,248		4,321		3,988
Furniture and equipment expenses		1,906		1,823		5,572		5,288
Amortization of intangible assets		—		318		602		952
Virginia franchise tax expense		576		631		1,730		1,894
FDIC insurance assessment		999		545		2,813		1,744
Data processing expense		2,369		2,552		8,255		7,130
Marketing expense		450		449		1,684		1,407
Telephone and communication expense		309		330		920		1,017
Professional fees		2,509		2,914		7,147		7,255
Miscellaneous lending expenses		231		1,098		1,965		1,835
Other operating expenses		2,866		2,283		8,238		7,182
Total noninterest expenses		32,313		30,955		96,771		88,279
Income (loss) before income taxes		8,737		(1,161)		36,289		3,169
Income tax expense (benefit)		1,907		(304)		7,988		1,679
Net income (loss)		6,830		(857)		28,301		1,490
Net loss attributable to noncontrolling interests		—		2,085		3,602		5,640
Net income attributable to Primis' common stockholders	$	6,830	$	1,228	$	31,903	$	7,130

Other comprehensive income:
Unrealized gains on available-for-sale securities	$	1,703	$	7,601	$	8,398	$	5,863
Tax expense		358		1,595		1,764		1,231
Other comprehensive income		1,345		6,006		6,634		4,632
Comprehensive income	$	8,175	$	7,234	$	38,537	$	11,762
Earnings per share, basic	$	0.28	$	0.05	$	1.29	$	0.29
Earnings per share, diluted	$	0.28	$	0.05	$	1.29	$	0.29

See accompanying notes to unaudited condensed consolidated financial statements.

Table of Contents

PRIMIS FINANCIAL CORP.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY
(dollars in thousands, except per share amounts) (Unaudited)


	For the Three Months Ended September 30, 2025
											Accumulated
					Additional						Other
	Common Stock				Paid in		Retained		Treasury		Comprehensive		Noncontrolling
	Shares		Amount		Capital		Earnings		Stock		Income (Loss)		Interests		Total
Balance - June 30, 2025		24,643,185	$	247	$	314,743	$	78,175	$	(807)	$	(15,943)	$	—	$	376,415
Net income		—		—		—		6,830		—		—		—		6,830
Other comprehensive income		—		—		—		—		—		1,345		—		1,345
Dividends on common stock ($0.10 per share)		—		—		—		(2,464)		—		—		—		(2,464)
Stock option exercises		1,200		—		15		—		—		—		—		15
Stock-based compensation expense		—		—		12		—		—		—		—		12
Balance - September 30, 2025		24,644,385	$	247	$	314,770	$	82,541	$	(807)	$	(14,598)	$	—	$	382,153

		For the Three Months Ended September 30, 2024
											Accumulated
					Additional						Other
	Common Stock				Paid in		Retained		Treasury		Comprehensive		Noncontrolling
	Shares		Amount		Capital		Earnings		Stock		Income (Loss)		Interests		Total
Balance - June 30, 2024		24,708,234	$	247	$	313,852	$	85,099	$	—	$	(23,151)	$	18,164	$	394,211
Issuance of Panacea Financial Holdings stock, net of costs		—		—		—		—		—		—		(38)		(38)
Net income (loss)		—		—		—		1,228		—		—		(2,085)		(857)
Other comprehensive income		—		—		—		—		—		6,006		—		6,006
Dividends on common stock ($0.10 per share)		—		—		—		(2,473)		—		—		—		(2,473)
Stock option exercises		15,500		—		173		—		—		—		—		173
Restricted stock forfeited		(1,000)		—		—		—		—		—		—		—
Stock-based compensation expense		—		—		41		—		—		—		—		41
Balance - September 30, 2024		24,722,734	$	247	$	314,066	$	83,854	$	—	$	(17,145)	$	16,041	$	397,063


		For the Nine Months Ended September 30, 2025
											Accumulated
					Additional						Other
	Common Stock				Paid in		Retained		Treasury		Comprehensive		Noncontrolling
	Shares		Amount		Capital		Earnings		Stock		Income (Loss)		Interests		Total
Balance - December 31, 2024		24,722,734	$	247	$	314,694	$	58,047	$	—	$	(21,232)	$	13,226	$	364,982
Net income (loss)		—		—		—		31,903		—		—		(3,602)		28,301
Other comprehensive income		—		—		—		—		—		6,634		—		6,634
Panacea Financial Holdings, Inc. deconsolidation		—		—		—		—		—		—		(9,624)		(9,624)
Dividends on common stock ($0.30 per share)		—		—		—		(7,409)		—		—		—		(7,409)
Stock option exercises		1,200		—		15		—		—		—		—		15
Repurchase of common stock		(79,549)		—		—		—		(807)		—		—		(807)
Stock-based compensation expense		—		—		61		—		—		—		—		61
Balance - September 30, 2025		24,644,385	$	247	$	314,770	$	82,541	$	(807)	$	(14,598)	$	—	$	382,153

		For the Nine Months Ended September 30, 2024
											Accumulated
					Additional						Other
	Common Stock				Paid in		Retained		Treasury		Comprehensive		Noncontrolling
	Shares		Amount		Capital		Earnings		Stock		Income (Loss)		Interests		Total
Balance - December 31, 2023		24,693,172	$	247	$	313,548	$	84,143	$	—	$	(21,777)	$	21,432	$	397,593
Issuance of Panacea Financial Holdings stock, net of costs		—		—		—		—		—		—		249		249
Net income (loss)		—		—		—		7,130		—		—		(5,640)		1,490
Other comprehensive income		—		—		—		—		—		4,632		—		4,632
Dividends on common stock ($0.30 per share)		—		—		—		(7,419)		—		—		—		(7,419)
Stock option exercises		30,916		—		210		—		—		—		—		210
Restricted stock forfeited		(1,000)		—		—		—		—		—		—		—
Repurchase of restricted stock		(354)		—		(4)		—		—		—		—		(4)
Stock-based compensation expense		—		—		312		—		—		—		—		312
Balance - September 30, 2024		24,722,734	$	247	$	314,066	$	83,854	$	—	$	(17,145)	$	16,041	$	397,063

See accompanying notes to unaudited condensed consolidated financial statements.

Table of Contents

PRIMIS FINANCIAL CORP.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands, except per share amounts) (Unaudited)


	For the Nine Months Ended September 30,
	2025		2024
Operating activities:
Net income	$	28,301	$	1,490
Adjustments to reconcile net income to net cash and cash equivalents (used in) provided by operating activities:
Depreciation and amortization		6,535		6,723
Net amortization of premiums and (accretion of discounts)		285		(11)
Provision for credit losses		9,850		17,138
Proceeds from sales of loans originated to sell		12,224		76,194
Net change in mortgage loans held for sale		(34,436)		(42,783)
Net gains on mortgage banking		(22,395)		(18,779)
Net gains on sale of loans		(459)		(307)
Proceeds from sales of assets held for sale		2,308		3,319
Loss on bank premises and equipment and assets held for sale		191		—
Earnings on bank-owned life insurance		(1,319)		(1,272)
Gain on bank-owned life insurance death benefit		—		(703)
Stock-based compensation expense		61		312
Gains on Panacea Financial Holdings investment		(32,322)		—
Gains on other investments		(126)		(393)
Deferred income tax expense (benefit)		7,374		(4,418)
Net change in fair value of loan derivative		4,102		3,660
Net (increase) decrease in other assets		(546)		18,549
Net increase (decrease) in other liabilities		2,404		(1,368)
Net cash and cash equivalents (used in) provided by operating activities		(17,968)		57,351
Investing activities:
Purchases of securities available-for-sale		(18,460)		(34,170)
Proceeds from paydowns, maturities and calls of securities available-for-sale		27,615		25,380
Proceeds from paydowns, maturities and calls of securities held-to-maturity		879		1,863
Net increase in FRB and FHLB stock		(3,998)		(6,629)
Net change in loans held for investment		(299,072)		(209,673)
Proceeds from sales of loans initially originated to be held for investment		57,093		—
Proceeds from sale of Panacea Financial Holdings investment		22,091		—
Proceeds from sale of other investment		432		—
Net (increase) decrease in other investments		(49)		288
Net cash and cash equivalents used in investing activities		(213,469)		(219,677)
Financing activities:
Net increase in deposits		155,770		36,276
Increase in securities sold under agreements to repurchase		36		633
Repayments of secured borrowings, net		(1,792)		(2,898)
Repayment of short-term FHLB advances		—		135,000
Cash dividends paid on common stock		(7,409)		(7,419)
Repurchase of common stock		(807)		—
Proceeds from exercised stock options		15		210
Repurchase of restricted stock		—		(4)
Increase in short-term FHLB advances		85,000		—
Issuance of Panacea Financial Holdings stock, net of costs		—		249
Net cash and cash equivalents provided by financing activities		230,813		162,047
Net change in cash and cash equivalents		(624)		(279)
Cash and cash equivalents at beginning of period		64,505		77,553
Cash and cash equivalents at end of period	$	63,881	$	77,274
Supplemental disclosure of cash flow information
Cash payments for:
Interest	$	67,194	$	80,491
Income taxes	$	496	$	42
Supplemental schedule of noncash activities:
Loans held for sale transferred to held for investment	$	101,568	$	—
Loans held for investment transferred to loans held for sale, at lower of cost or market	$	53,591	$	361,825
Assets held for sale transferred to other assets	$	2,221	$	—
Deconsolidation of Panacea Financial Holdings, Inc.	$	9,624	$	—

See accompanying notes to unaudited condensed consolidated financial statements.

Table of Contents

PRIMIS FINANCIAL CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

1. ACCOUNTING POLICIES

The Company

Primis Financial Corp. (NASDAQ: FRST) is the bank holding company for Primis Bank, a Virginia state-chartered bank, that commenced operations on April 14, 2005. Primis Bank provides a range of financial services to individuals and small and medium-sized businesses. As of September 30, 2025, Primis Bank had 24 full-service branches in Virginia and Maryland and also provides services to customers through certain online and mobile applications. Headquartered in McLean, Virginia, the Company has an administrative office in Glen Allen, Virginia and an operations center in Atlee, Virginia. PMC, a residential mortgage lender headquartered in Wilmington, North Carolina, is a consolidated subsidiary of Primis Bank. PFH owns the rights to the Panacea Financial brand and its intellectual property and partners with the Bank to offer a suite of financial products and services for doctors, their practices, and ultimately the broader healthcare industry. PFH was deconsolidated from the Company on March 31, 2025, as further discussed below in “PFH Deconsolidation and Sale of Shares”. The operating results of PFH were included in the Company’s consolidated operating results through March 31, 2025.

Basis of Financial Information

The accounting policies and practices of Primis and its subsidiaries conform to GAAP and follow general practices within the banking industry. A discussion of the Company’s material accounting policies is located in our 2024 Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”).

These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the 2024 Form 10-K. Certain prior period amounts have been reclassified to conform to current period presentation. None of these reclassifications had a material effect on the Company’s financial statements. See Note 1 “Summary of Significant Accounting Policies” in the “Notes to the Consolidated Financial Statements” contained in Item 8 “Financial Statements and Supplementary Data” in the Company’s 2024 Form 10-K for additional information on the Company’s accounting policies. There have not been any significant changes to the Company’s accounting policies from those disclosed in the Company’s 2024 Form 10-K that could have a material effect on the Company’s financial statements.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of Primis and its subsidiaries, Primis Bank and PMC. The results of operations for PFH are included in the Company’s results of operations until its deconsolidation as of March 31, 2025, as further described below. Significant inter-company accounts and transactions have been eliminated in consolidation. Primis consolidates subsidiaries in which it holds, directly or indirectly, more than 50 percent of the voting rights or where it exercises control. Entities where Primis holds 20 to 50 percent of the voting rights, or has the ability to exercise significant influence, or both, are accounted for under the equity method. Primis owns EVB Statutory Trust I (the “Trust”), which is an unconsolidated subsidiary and the junior subordinated debt owed to the Trust is reported as a liability of Primis.

We determine whether we have a controlling financial interest in an entity by first evaluating whether the entity is a voting interest entity or a VIE under GAAP. Voting interest entities are entities in which the total equity investment at risk is sufficient to enable the entity to finance itself independently and provides the equity holders with the obligation to absorb losses, the right to receive residual returns and the right to make decisions about the entity’s activities. We consolidate voting interest entities in which we have all, or at least a majority of, the voting interest. As defined in GAAP, VIEs are entities that lack one or more of the characteristics of a voting interest entity. A controlling financial interest in a VIE is present when an enterprise has both the power to direct the activities of the VIE that most significantly impact the VIE’s

Table of Contents

economic performance and an obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. The enterprise with a controlling financial interest, known as the primary beneficiary, consolidates the VIE. The Company has investments in VIE’s for which we are not the primary beneficiary and, as such, are not included in our consolidated financial statements.

PFH Deconsolidation and Sale of Shares

On December 21, 2023, PFH completed a $25 million Series B financing round led by a global venture capital firm. As part of the financing round, Primis acquired approximately 19% of PFH’s common stock for an immaterial purchase price due to previous operating losses in the Bank’s Panacea Financial Division. The Company performed an analysis and determined that PFH is a VIE because it lacks one or more of the characteristics of a voting interest entity. The Company’s analysis further determined that it has a controlling financial interest in PFH due to the substantial historical activities between PFH and the Bank’s Panacea Financial Division combined with the limited activities of PFH outside of its relationship with Primis. Further, there are employees of Primis that have historically carried out substantially all of the activities of PFH. Accordingly, the Company determined it is the primary beneficiary of PFH and consolidated it as of December 31, 2023.

As of March 31, 2025, the three primary executives of PFH resigned from their positions as management-level employees of Primis’ Panacea Financial Division of the Bank. Additionally, Primis and PFH amended their partnership agreement as of March 31, 2025 to allow PFH more control over the type and amount of lending it can perform through the Bank. As a result of these changes in the relationship between the Company and PFH, a re-assessment of PFH under the VIE accounting guidance was performed. The Company determined that PFH continues to be a VIE because it lacks one or more of the characteristics of a voting interest entity. However, as of March 31, 2025, the Company has determined, based on the relationship changes described above, that it was no longer the primary beneficiary of the VIE because it no longer has the power to direct the activities that most significantly impact the VIE’s economic performance. Accordingly, the Company deconsolidated PFH as of March 31, 2025.

Upon deconsolidation, the Company performed an analysis of its 2 million common share investment in PFH. The Company determined that based on a combination of its level of voting share ownership (19% of total outstanding voting shares), along with meaningful continued involvement in PFH’s lending and operating activities, the investment met the requirements to be accounted for in accordance with ASC 323, Investments - Equity Method and Joint Ventures. As of the time of deconsolidation and initial application of ASC 323, the Company decided to elect the FVO allowed under ASC 323 and accounted for its investment in PFH common stock as of March 31, 2025 at fair value under ASC 825, Financial Instruments. The FVO is irrevocable and must be used in all future periods following election.

For the three months ended March 31, 2025, the Company recognized a gain from deconsolidation of PFH of $25 million, which is recorded in the income statement in “Gain on Panacea Financial Holdings investment” within noninterest income. The gain resulted from recognition, as of the deconsolidation date of March 31, 2025, of the Company’s retained interest in PFH common stock of $21 million, at fair value, and the deconsolidation as of the same date of noncontrolling interest in PFH of $10 million and PFH’s net assets of $6 million. The Company engaged a third-party valuation specialist to perform a valuation of the Company’s PFH common shares as of March 31, 2025. The valuation included an assessment of the value of PFH primarily using an income approach leveraging a discounted cash flow technique. Key inputs and assumptions in the valuation included projected financial growth of PFH driven by future loan growth assumptions, growth in new services offerings of PFH, and cost savings from fundings provided by customer growth. Following deconsolidation, the Company continues to originate loans for PFH through its Panacea Division of the Bank, retaining some of the originated loans and selling the remaining. Any loans retained by the Company will be included within net loans in the balance sheet and will be included in the Company’s determination of future expected credit losses, which is the Company’s primary exposure to losses as a result of its continued involvement with PFH. For any originated loans that are intended to be sold, the Company will also include these on its balance sheet until the time of sale but through an agreement with PFH, any exposure to a decline in value prior to sale will be reimbursed to the Company by PFH. The

Table of Contents

Company will also continue, through the Division, to provide loan origination support to PFH and the servicing of loans retained by the Division.

On June 12, 2025, the Company signed a non-binding term sheet to sell a portion of its retained ownership in PFH common shares after the deconsolidation that generated proceeds to the Company of $22 million. Following the sale of these shares, the Company continued to hold approximately 467 thousand shares in PFH. The Company utilizes a third-party valuation specialist to value these shares at each quarter end to support the Company’s recording of its investment at fair value as previously discussed. For the nine months ended September 30, 2025, the Company recorded a gain of $8 million in the income statement in “Gain on Panacea Financial Holdings investment” within noninterest income related to the sale of PFH common shares and fair value adjustments on its remaining investment.

Following deconsolidation, the Company determined that any transactions between the Company and PFH would be related party transactions under relevant accounting guidance. The primary transactions between the Company and PFH relate to quarterly payments between the parties driven by financial performance of loans PFH originates in the Division of the Bank. As of September 30, 2025, the Company had a payable of $200 thousand included within other liabilities on the balance sheet related to this payment due to PFH. As of September 30, 2025, the Company did not hold any assets on its balance sheet related to PFH that could be used by PFH to settle their obligations. The Company does not have an obligation to provide any future monetary support to PFH. The maximum exposure to loss as of September 30, 2025 as a result of continued involvement with PFH is the common stock investment of $7 million and any potential credit losses on loans originated in the division of the Bank as discussed above.

Disposition of the Life Premium Finance Division

On October 24, 2024, the Company entered into a purchase and assumption agreement with EverBank, N.A. (“EverBank”) for the sale of the Company’s Life Premium Finance division (“LPF”). EverBank acquired LPF from the Company, except for a subset of mostly fixed rate and rate-capped loans that were retained by the Bank. All of the LPF operations, including its employees, were assumed by EverBank following the close of the transaction, which took place in two parts. EverBank acquired approximately $370 million of loans from the division at a $6 million premium at the first close on October 31, 2024. Between the first and second closing on January 31, 2025, EverBank purchased loans generated by the division in ordinary course at par. The Bank provided interim servicing from the first closing until the transition of the business at the final closing, when EverBank began servicing the purchased loans and serviced the Bank’s retained portfolio for the duration of the portfolio. From the first closing through December 31, 2024, the Bank sold approximately $400 million of loans and related accrued interest and recorded a pre-tax gain of $5 million, net of advisory and legal fees. As of December 31, 2024, the Bank had an additional $51 million of loans to be sold to EverBank which were recorded in loans held for sale at the lower of cost or market. The Bank subsequently sold approximately $64 million of additional loans at par to EverBank (inclusive of the loans in held for sale at year end) from January 1, 2025 through the second closing on January 31, 2025.

Operating Segments

The Company, through its Bank subsidiary, provides a broad range of financial services. While the Company’s chief operating decision maker monitors the revenue streams of the various financial products and services, operations are managed and financial performance is evaluated on an organization-wide basis. Management has determined that the Company has two reportable operating segments: Primis Mortgage and Primis Bank, as discussed in Note 11 – Segment Information.

Basis of Presentation

The unaudited condensed consolidated financial statements and notes thereto have been prepared in accordance with GAAP for interim financial information and instructions for Form 10-Q and follow general practice within the banking industry. Accordingly, the unaudited condensed consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. However, in the opinion of management, all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of the results of the interim

Table of Contents

periods presented have been made. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the full year. For further information, refer to the consolidated financial statements and footnotes thereto included in the 2024 Form 10-K.

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates. Estimates that are particularly susceptible to change in the near term include: the determination of the allowance for credit losses, the fair value of investment securities, the credit impairment of investment securities, the mortgage banking derivatives, interest rate swap derivatives, Consumer Program derivatives, the valuation of goodwill, and deferred tax assets. Management monitors and continually reassess these at each reporting period.

Interest Rate Swaps

The Company is subject to interest rate risk exposure in the normal course of business through its core lending operations. Primarily to help mitigate interest rate risk associated with its loan portfolio, the Company entered into interest rate swaps in May and August of 2023 with a large U.S. financial institution as the counterparty. Interest rate swaps are contractual agreements whereby one party pays a floating interest rate on a notional principal amount and receives a fixed-rate payment on the same notional principal, or vice versa, for a fixed period of time. Interest rate swaps change in value with movements in benchmark interest rates, such as Prime or SOFR. Interest rate swaps subject the Company to market risk associated with changes in interest rates, changes in interest rate volatility, as well as the credit risk that the counterparty will fail to perform. The Company’s interest rate swaps are pay-fixed and receive-floating whereby the Company receives a variable rate of interest based on SOFR.

As of September 30, 2025, the gross amounts of interest rate swap derivative assets and liabilities were $196 thousand and $333 thousand, respectively, and are recorded net in other assets on the consolidated balance sheets. As of December 31, 2024, the gross amounts of interest rate swap derivative assets and liabilities were $1 million and $248 thousand, respectively, and are recorded net in other assets on the consolidated balance sheets. One of the Company’s three interest rate swaps matured in May of 2025 and the remaining two swaps mature in May and August of 2026.

The following table represents the carrying value of the portfolio layer method hedged assets and the cumulative fair value hedging adjustments included in the carrying value of the hedged assets as of September 30, 2025 and December 31, 2024:


	September 30, 2025						December 31, 2024
(dollars in thousands)	Amortized Cost Basis		Hedged Asset		Basis Adjustment		Amortized Cost Basis		Hedged Asset		Basis Adjustment
Fixed rate assets	$	727,236	$	150,103	$	103	$	818,375	$	249,190	$	(810)

Treasury Stock

On December 19, 2024, the Board of Directors of the Company authorized a stock repurchase program (the “Stock Repurchase Program”) under which the Company may repurchase up to 740,600 shares of its outstanding common stock. The Stock Repurchase Program began on December 19, 2024, near the end of the previously authorized repurchase plan, and will end on December 19, 2025. The Stock Repurchase Program does not obligate the Company to purchase any particular number of shares, and there is no guarantee as to the exact number of shares that will be repurchased by the Company. The Stock Repurchase Program may be suspended, modified or terminated by the Company at any time and for any reason, without prior notice.

In June 2025, the Company repurchased a total of 79,549 shares of its common stock under the Stock Repurchase Program at an average cost of $10.00 per share and recorded the stock in Treasury Stock in Stockholders’ Equity at its repurchase cost of $807 thousand. At the date of repurchase, Stockholders' Equity was reduced by the repurchase price. If

Table of Contents

the Company subsequently reissues treasury shares, Treasury Stock is reduced by the cost of such stock with differences recorded in additional paid-in capital or retained earnings, as applicable. The remaining buyback authority under the Stock Repurchase Program was 661,051 shares as of September 30, 2025.

Recent Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU requires annual disclosure of certain information relating to the rate reconciliation, income taxes paid by jurisdiction, income (or loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic and foreign, and income tax expense (or benefit) from continuing operations disaggregated by federal, state, and foreign. The ASU also eliminates certain requirements relating to unrecognized tax benefits and certain deferred tax disclosure relating to subsidiaries and corporate joint ventures. This ASU is effective for the Company’s annual disclosures beginning for the year ended December 31, 2025. The Company is currently evaluating the impact of this ASU to the annual financial statement disclosures in its Form 10-K for the year ending December 31, 2025.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40). This ASU requires more disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses but does not change the requirements for the presentation of expenses on the face of the income statement. In January 2025, FASB issued an update ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40), clarifying the effective date. The amendments in this standard will be effective for the Company’s annual disclosures beginning for the year ended December 31, 2027, and interim periods within fiscal years beginning on January 1, 2028, and is required to be applied prospectively, with early adoption permitted. The Company does not believe this standard will have a material impact on its consolidated financial statements.

In May 2025, the FASB issued ASU 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810) – Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity. This ASU modifies the Topic 805 framework for identifying the accounting acquirer in certain business combinations when the legal acquiree is a VIE. Existing guidance states the primary beneficiary is the accounting acquirer of a VIE in a business combination even if Topic 805’s general factors used to identify the accounting acquirer (which apply to other business combinations) suggest that the transaction would otherwise be a reverse acquisition. This ASU modifies existing guidance by limiting situations in which entities must identify the primary beneficiary as the accounting acquirer in certain business combinations and requiring entities to consider the general factors in Topic 805 when a business combination involving a VIE is primarily effected through exchanging equity interests. The ASU is to be applied prospectively to annual and interim reporting periods beginning after December 15, 2026 for all entities, with early adoption permitted. The Company does not believe this standard will have a material impact on its consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40) – Targeted Improvements to the Accounting for Internal-use Software. This ASU is intended to modernize old internal-use software guidance that is twenty years old to adapt to the agile (i.e., iterative and flexible) basis predominantly used to develop software today. The key changes to the guidance include (i) eliminating accounting consideration of software project development stages, (ii) enhancing the guidance around the ‘probable-to-complete’ threshold, (iii) modifying the website development costs guidance by eliminating Subtopic 350-50 and relocating any remaining relevant guidance into Subtopic 350-40, and (iv) providing new examples to illustrate the applications of the updated guidance. The ASU allows entities to adopt the guidance either (1) retrospectively, (2) prospectively to software costs incurred after the adoption date (i.e. on existing, in-process software projects or new projects) or (3) on a modified prospective basis. The ASU is effective for the Company starting in annual and interim periods beginning after December 31, 2027, with early adoption permitted. The Company is currently assessing the potential impact of adoption of this ASU on its consolidated financial statements.

In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606) - Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract. This ASU expands the population of contracts that are excluded from the scope of derivative accounting. It also clarifies that the revenue guidance in ASC 606 initially applies to share-

Table of Contents

based noncash consideration received from a customer for the transfer of goods or services. The ASU adds a scope exception from derivative accounting for nonexchange traded contracts with underlyings based on operations or activities specific to one of the parties to the contract. The ASU also clarifies that the revenue guidance in ASC 606 applies initially to share-based noncash consideration (e.g., shares, share options or other equity instruments) received from a customer for the transfer of goods or services. The guidance in other ASCs, including derivatives (ASC 815) and equity securities (ASC 321), is not applied unless and until the entity’s right to receive or retain the share-based noncash consideration is unconditional under ASC 606. The ASU allows entities to adopt the guidance either prospectively or on a modified retrospective basis. The ASU is effective for the Company starting in annual and interim periods beginning after December 31, 2026, with early adoption permitted. The Company is currently assessing the potential impact of adoption of this ASU on its consolidated financial statements.

Table of Contents

2. INVESTMENT SECURITIES

The amortized cost and fair value of AFS investment securities and the related gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) were as follows ($ in thousands):


	Amortized		Gross Unrealized				Fair
	Cost		Gains		Losses		Value
September 30, 2025
Residential government-sponsored mortgage-backed securities	$	102,557	$	250	$	(10,154)	$	92,653
Obligations of states and political subdivisions		31,753		3		(2,779)		28,977
Corporate securities		10,000		—		(780)		9,220
Residential government-sponsored collateralized mortgage obligations		61,260		523		(964)		60,819
Government-sponsored agency securities		16,351		—		(1,821)		14,530
Agency commercial mortgage-backed securities		24,483		—		(2,541)		21,942
SBA pool securities		6,587		6		(74)		6,519
Total	$	252,991	$	782	$	(19,113)	$	234,660


	Amortized		Gross Unrealized				Fair
	Cost		Gains		Losses		Value
December 31, 2024
Residential government-sponsored mortgage-backed securities	$	105,655	$	5	$	(14,253)	$	91,407
Obligations of states and political subdivisions		33,500		3		(3,798)		29,705
Corporate securities		16,000		—		(920)		15,080
Residential government-sponsored collateralized mortgage obligations		57,908		223		(1,741)		56,390
Government-sponsored agency securities		16,315		—		(2,479)		13,836
Agency commercial mortgage-backed securities		25,750		—		(3,572)		22,178
SBA pool securities		7,504		6		(203)		7,307
Total	$	262,632	$	237	$	(26,966)	$	235,903

The amortized cost, gross unrecognized gains and losses, allowance for credit losses and fair value of investment securities HTM were as follows ($ in thousands):


	Amortized		Gross Unrecognized				Allowance for		Fair
	Cost		Gains		Losses		Credit Losses		Value
September 30, 2025
Residential government-sponsored mortgage-backed securities	$	6,893	$	2	$	(485)	$	—	$	6,410
Obligations of states and political subdivisions		1,519		—		(26)		—		1,493
Residential government-sponsored collateralized mortgage obligations		138		—		(4)		—		134
Total	$	8,550	$	2	$	(515)	$	—	$	8,037


	Amortized		Gross Unrecognized				Allowance for		Fair
	Cost		Gains		Losses		Credit Losses		Value
December 31, 2024
Residential government-sponsored mortgage-backed securities	$	7,760	$	2	$	(764)	$	—	$	6,998
Obligations of states and political subdivisions		1,519		—		(75)		—		1,444
Residential government-sponsored collateralized mortgage obligations		169		—		(9)		—		160
Total	$	9,448	$	2	$	(848)	$	—	$	8,602

No AFS investment securities were purchased during the three months ended September 30, 2025. AFS investment securities of $18 million were purchased during the nine months ended September 30, 2025 and $16 million and $34 million were purchased during the three and nine months ended September 30, 2024, respectively. No HTM investments were purchased during the three and nine months ended September 30, 2025 and 2024. No investment securities were sold during the three and nine months ended September 30, 2025 and 2024.

Table of Contents

The amortized cost and fair value of AFS and HTM investment securities as of September 30, 2025, by contractual maturity, were as follows ($ in thousands). Investment securities not due at a single maturity date are shown separately.


	Available-for-Sale				Held-to-Maturity
	Amortized				Amortized
	Cost		Fair Value		Cost		Fair Value
Due within one year	$	1,797	$	1,789	$	—	$	—
Due in one to five years		12,827		12,413		1,014		994
Due in five to ten years		32,637		28,745		505		499
Due after ten years		10,843		9,780		—		—
Residential government-sponsored mortgage-backed securities		102,557		92,653		6,893		6,410
Residential government-sponsored collateralized mortgage obligations		61,260		60,819		138		134
Agency commercial mortgage-backed securities		24,483		21,942		—		—
SBA pool securities		6,587		6,519		—		—
Total	$	252,991	$	234,660	$	8,550	$	8,037

Investment securities with a carrying amount of approximately $134 million and $141 million at September 30, 2025 and December 31, 2024, respectively, were pledged to secure public deposits, certain other deposits, a line of credit for advances from the FHLB of Atlanta, and repurchase agreements.

Management measures expected credit losses on HTM securities on a collective basis by major security type with each type sharing similar risk characteristics and considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. Regarding U.S. Treasury and residential mortgage-backed securities issued by the U.S. government, or agencies thereof, it is expected that the securities will not be settled at prices less than the amortized cost basis of the securities as such securities are backed by the full faith and credit of and/or guaranteed by the U.S. government. Accordingly, no allowance for credit losses has been recorded for these securities. Regarding securities issued by states and political subdivisions and other HTM securities, management considers (i) issuer bond ratings, (ii) historical loss rates for given bond ratings, (iii) whether issuers continue to make timely principal and interest payments under the contractual terms of the securities and (iv) internal forecasts. As of September 30, 2025, Primis did not have a material allowance for credit losses on HTM securities.

As of September 30, 2025 and December 31, 2024, there were 148 and 155, respectively, of investment securities AFS that were in an unrealized loss position. The unrealized losses related to investment securities AFS as of September 30, 2025 and December 31, 2024, relate to changes in interest rates relative to when the investment securities were purchased, and do not indicate credit-related impairment. Primis performs quantitative analysis and if needed, a qualitative analysis in this determination. As a result of the Company’s analysis, none of the securities were deemed to require an allowance for credit loss. Primis has the ability and intent to retain these securities for a period of time sufficient to recover all unrealized losses.

Table of Contents

The following tables present information regarding investment securities AFS and HTM in a continuous unrealized loss position as of September 30, 2025 and December 31, 2024 by duration of time in a loss position ($ in thousands):


	Less than 12 months				12 Months or More				Total
September 30, 2025	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
Available-for-Sale	value		Losses		value		Losses		value		Losses
Residential government-sponsored mortgage-backed securities	$	—	$	—	$	75,563	$	(10,154)	$	75,563	$	(10,154)
Obligations of states and political subdivisions		—		—		26,224		(2,779)		26,224		(2,779)
Corporate securities		—		—		9,221		(780)		9,221		(780)
Residential government-sponsored collateralized mortgage obligations		—		—		17,493		(964)		17,493		(964)
Government-sponsored agency securities		—		—		14,530		(1,821)		14,530		(1,821)
Agency commercial mortgage-backed securities		—		—		21,942		(2,541)		21,942		(2,541)
SBA pool securities		349		(2)		5,710		(72)		6,059		(74)
Total	$	349	$	(2)	$	170,683	$	(19,111)	$	171,032	$	(19,113)


	Less than 12 months				12 Months or More				Total
September 30, 2025	Fair		Unrecognized		Fair		Unrecognized		Fair		Unrecognized
Held-to-Maturity	value		Losses		value		Losses		value		Losses
Residential government-sponsored mortgage-backed securities	$	—	$	—	$	6,343	$	(485)	$	6,343	$	(485)
Obligations of states and political subdivisions		—		—		913		(26)		913		(26)
Residential government-sponsored collateralized mortgage obligations		—		—		134		(4)		134		(4)
Total	$	—	$	—	$	7,390	$	(515)	$	7,390	$	(515)


	Less than 12 months				12 Months or More				Total
December 31, 2024	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
Available-for-Sale	value		Losses		value		Losses		value		Losses
Residential government-sponsored mortgage-backed securities	$	10,233	$	(102)	$	80,700	$	(14,151)	$	90,933	$	(14,253)
Obligations of states and political subdivisions		2,060		(21)		26,642		(3,777)		28,702		(3,798)
Corporate securities		—		—		15,080		(920)		15,080		(920)
Residential government-sponsored collateralized mortgage obligations		16,488		(339)		14,739		(1,402)		31,227		(1,741)
Government-sponsored agency securities		—		—		13,836		(2,479)		13,836		(2,479)
Agency commercial mortgage-backed securities		—		—		22,178		(3,572)		22,178		(3,572)
SBA pool securities		4,359		(161)		2,426		(42)		6,785		(203)
Total	$	33,140	$	(623)	$	175,601	$	(26,343)	$	208,741	$	(26,966)


	Less than 12 months				12 Months or More				Total
December 31, 2024	Fair		Unrecognized		Fair		Unrecognized		Fair		Unrecognized
Held-to-Maturity	value		Losses		value		Losses		value		Losses
Residential government-sponsored mortgage-backed securities	$	—	$	—	$	6,927	$	(764)	$	6,927	$	(764)
Obligations of states and political subdivisions		572		(8)		872		(67)		1,444		(75)
Residential government-sponsored collateralized mortgage obligations		—		—		160		(9)		160		(9)
Total	$	572	$	(8)	$	7,959	$	(840)	$	8,531	$	(848)

Table of Contents

3. LOANS AND ALLOWANCE FOR CREDIT LOSSES

The following table summarizes the composition of our loan portfolio as of September 30, 2025 and December 31, 2024 ($ in thousands):


	September 30, 2025		December 31, 2024
Loans held for sale, at fair value	$	148,781	$	83,276
Loans held for sale, at lower of cost or market		53,591		163,832
Total loans held for sale	$	202,372	$	247,108

Loans held for investment
Loans secured by real estate:
Commercial real estate - owner occupied ⁽¹⁾	$	495,739	$	475,898
Commercial real estate - non-owner occupied		592,480		610,482
Secured by farmland		3,642		3,711
Construction and land development		102,227		101,243
Residential 1-4 family		564,087		588,859
Multi-family residential		137,804		158,426
Home equity lines of credit		62,458		62,954
Total real estate loans		1,958,437		2,001,573

Commercial loans ⁽²⁾		915,158		608,595
Paycheck Protection Program loans		1,723		1,927
Consumer loans		319,977		270,063
Total Non-PCD loans		3,195,295		2,882,158
PCD loans		4,939		5,289
Total loans held for investment	$	3,200,234	$	2,887,447

(1)	Includes $6 million related to loans collateralizing secured borrowings as of both September 30, 2025 and December 31, 2024.

(2)	Includes $9 million and $11 million related to loans collateralizing secured borrowings as of September 30, 2025 and December 31, 2024, respectively.

Loans held for sale, at the lower of cost or market

As of September 30, 2025, $54 million of commercial loans were included in loans held for sale, at the lower of cost or market, based on the Company’s decision to sell the loans. As of December 31, 2024, $113 million of Consumer Program loans and $51 million of life premium finance loans were included in loans held for sale, at the lower of cost or market, based on the Company’s decision to sell the loans. The life premium finance loans were sold during the nine months ended September 30, 2025. At March 31, 2025, the Company determined it would no longer sell the Consumer Program loans and has the intent and ability to hold these loans for the foreseeable future as it intends to run off the portfolio and therefore transferred the loans back to the consumer loans category within loans held for investment at their amortized cost of $102 million as of that date.

Consumer Program Loans

The Company had $101 million and $152 million of amortized cost balance of loans outstanding in the Consumer Program as of September 30, 2025 and December 31, 2024, respectively, or 3% and 5%, respectively of our total gross loan portfolio as of each date. Loans in the Consumer Program are included within the consumer loans category disclosures in this footnote as of September 30, 2025. As of December 31, 2024, $113 million is included in loans held for sale, at the lower of cost or market, and $39 million in the consumer loans category in loans held for investment. As of September 30, 2025, 7% of the loans were in a promotional period requiring no payment of interest, with 91% of these promotional loan periods ending in the fourth quarter of 2025 through the second quarter of 2026.

Table of Contents

Accrued Interest Receivable

Accrued interest receivable on loans totaled $17 million as of both September 30, 2025 and December 31, 2024 and is included in other assets in the consolidated balance sheets.

Nonaccrual and Past Due Loans

Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due. Loans are placed on nonaccrual status when, in management’s opinion, the borrower may be unable to meet payment obligations as they become due, as well as when required by regulatory provisions. In determining whether or not a borrower may be unable to meet payment obligations for each class of loans, we consider the borrower’s debt service capacity through the analysis of current financial information, if available, and/or current information with regards to our collateral position. Regulatory provisions typically require the placement of a loan on nonaccrual status if (i) principal or interest has been in default for a period of 90 days or more unless the loan is both well secured and in the process of collection or (ii) full payment of principal and interest is not expected. Loans may be placed on nonaccrual status regardless of whether or not such loans are considered past due. When interest accrual is discontinued, all unpaid accrued interest is reversed. Interest income on nonaccrual loans is recognized only to the extent that cash payments are received in excess of principal due. A loan may be returned to accrual status when all the principal and interest amounts contractually due are brought current and future principal and interest amounts contractually due are reasonably assured, which is typically evidenced by a sustained period (at least six months) of repayment performance by the borrower.

Table of Contents

The following tables present the aging of the recorded investment in past due loans by class of loans held for investment as of September 30, 2025 and December 31, 2024 ($ in thousands):


	30 - 59		60 - 89		90
	Days		Days		Days		Total		Loans Not		Total
September 30, 2025	Past Due		Past Due		or More		Past Due		Past Due		Loans
Commercial real estate - owner occupied	$	5,426	$	56	$	1,494	$	6,976	$	488,763	$	495,739
Commercial real estate - non-owner occupied		40,129		11,888		—		52,017		540,463		592,480
Secured by farmland		—		—		—		—		3,642		3,642
Construction and land development		397		—		—		397		101,830		102,227
Residential 1-4 family		2,895		943		1,593		5,431		558,656		564,087
Multi- family residential		—		549		—		549		137,255		137,804
Home equity lines of credit		367		—		618		985		61,473		62,458
Commercial loans		17,337		5,640		24,784		47,761		867,397		915,158
Paycheck Protection Program loans		—		—		1,714		1,714		9		1,723
Consumer loans		2,791		1,565		104		4,460		315,517		319,977
Total Non-PCD loans		69,342		20,641		30,307		120,290		3,075,005		3,195,295
PCD loans		—		—		—		—		4,939		4,939
Total	$	69,342	$	20,641	$	30,307	$	120,290	$	3,079,944	$	3,200,234


	30 - 59		60 - 89		90
	Days		Days		Days		Total		Loans Not		Total
December 31, 2024	Past Due		Past Due		or More		Past Due		Past Due		Loans
Commercial real estate - owner occupied	$	456	$	52	$	4,021	$	4,529	$	471,369	$	475,898
Commercial real estate - non-owner occupied		9,539		4,290		—		13,829		596,653		610,482
Secured by farmland		—		—		—		—		3,711		3,711
Construction and land development		12		656		—		668		100,575		101,243
Residential 1-4 family		6,694		318		1,462		8,474		580,385		588,859
Multi- family residential		—		—		—		—		158,426		158,426
Home equity lines of credit		1,098		168		238		1,504		61,450		62,954
Commercial loans		24,101		1,279		1,954		27,334		581,261		608,595
Paycheck Protection Program loans		—		—		1,886		1,886		41		1,927
Consumer loans		6,625		7,013		—		13,638		256,425		270,063
Total Non-PCD loans		48,525		13,776		9,561		71,862		2,810,296		2,882,158
PCD loans		—				—		—		5,289		5,289
Total	$	48,525	$	13,776	$	9,561	$	71,862	$	2,815,585	$	2,887,447

Table of Contents

The amortized cost, by class, of loans and leases on nonaccrual status as of September 30, 2025 and December 31, 2024, were as follows ($ in thousands):


	90 Days			Less Than	Total		Nonaccrual With
	Past Due			90 Days	Nonaccrual		No Credit
September 30, 2025	or More			Past Due	Loans		Loss Allowance
Commercial real estate - owner occupied	$	1,494	$	482	$	1,976	$	651
Commercial real estate - non-owner occupied		—		40,090		40,090		364
Secured by farmland		—		301		301		301
Construction and land development		—		510		510		510
Residential 1-4 family		1,593		3,544		5,137		5,137
Home equity lines of credit		618		516		1,134		1,134
Commercial loans		24,784		8,901		33,685		8,669
Consumer loans		104		815		919		919
Total Non-PCD loans		28,593		55,159		83,752		17,685
PCD loans		—		1,221		1,221		1,221
Total	$	28,593	$	56,380	$	84,973	$	18,906

	90 Days			Less Than	Total		Nonaccrual With
	Past Due			90 Days	Nonaccrual		No Credit
December 31, 2024	or More			Past Due	Loans		Loss Allowance
Commercial real estate - owner occupied	$	4,021	$	431	$	4,452	$	641
Commercial real estate - non-owner occupied		—		393		393		393
Secured by farmland		—		378		378		378
Construction and land development		—		130		130		130
Residential 1-4 family		1,462		2,417		3,879		3,879
Home equity lines of credit		238		542		780		780
Commercial loans		1,954		720		2,674		846
Paycheck Protection Program loans		173		—		173		173
Consumer loans		—		864		864		864
Total Non-PCD loans		7,848		5,875		13,723		8,084
PCD loans		—		1,303		1,303		1,303
Total	$	7,848	$	7,178	$	15,026	$	9,387

There were $2 million of PPP loans greater than 90 days past due and still accruing as of both September 30, 2025 and December 31, 2024.

Table of Contents

The following table presents nonaccrual loans as of September 30, 2025 by class and year of origination ($ in thousands):



															Revolving Loans
													Revolving		Converted
	2025		2024		2023		2022		2021		Prior		Loans		To Term		Total
Commercial real estate - owner occupied	$	—	$	—	$	—	$	87	$	189	$	1,700	$	—	$	—	$	1,976
Commercial real estate - non-owner occupied		—		—		—		—		39,726		364		—		—		40,090
Secured by farmland		—		—		—		—		—		301		—		—		301
Construction and land development		—		—		—		—		—		510		—		—		510
Residential 1-4 family		—		112		—		517		—		3,641		284		583		5,137
Home equity lines of credit		—		—		—		—		—		—		503		631		1,134
Commercial loans		—		7,580		208		22,316		383		992		2,094		112		33,685
Consumer loans		8		47		85		443		318		2		—		16		919
Total non-PCD nonaccruals		8		7,739		293		23,363		40,616		7,510		2,881		1,342		83,752
PCD loans		—		—		—		—		—		1,221		—		—		1,221
Total nonaccrual loans	$	8	$	7,739	$	293	$	23,363	$	40,616	$	8,731	$	2,881	$	1,342	$	84,973

Interest received on nonaccrual loans was immaterial for the three months ended September 30, 2025 and $2 million for the nine months ended September 30, 2025, and immaterial for the three and nine months ended September 30, 2024.

Modifications Provided to Borrowers Experiencing Financial Difficulty

The Bank determines that a borrower may be experiencing financial difficulty if the borrower is currently delinquent on any of its debt, or if the Bank is concerned that the borrower may not be able to perform in accordance with the current terms of the loan agreement in the foreseeable future. Many aspects of the borrower’s financial situation are assessed when determining whether they are experiencing financial difficulty, particularly for commercial borrowers due to the complex nature of the loan structure, business/industry risk and borrower/guarantor structures. Concessions may include the reduction of an interest rate at a rate lower than current market rates for a new loan with similar risk, extension of the maturity date, reduction of accrued interest, or principal forgiveness. When evaluating whether a concession has been granted, the Bank also considers whether the borrower has provided additional collateral or guarantors and whether such additions adequately compensate the Bank for the restructured terms, or if the revised terms are consistent with those currently being offered to new loan customers.

The assessments of whether a borrower is experiencing financial difficulty at the time a concession has been granted is inherently subjective in nature, and management’s judgment is required when determining whether the concession results in a modification that is accounted for as a new loan or a continuation of the existing loan under GAAP.

Although each occurrence is unique to the borrower and is evaluated separately, for all portfolio segments, loans modified as a result of borrowers experiencing financial difficulty are typically modified through reductions in interest rates, reductions in payments, changing the payment terms from principal and interest to interest only, and/or extensions in term maturity.

The allowance for credit losses incorporates an estimate of lifetime expected credit losses and is recorded on each asset upon asset origination or acquisition. The starting point for the estimate of the allowance for credit losses is historical loss information, which includes losses from modifications of receivables to borrowers experiencing financial difficulty. Because the effect of most modifications made to borrowers experiencing financial difficulty is already included in the allowance for credit losses because of the measurement methodologies used to estimate the allowance, a change to the allowance for credit losses is generally not recorded upon modification. Occasionally, the Company modifies

Table of Contents

certain loans by providing principal forgiveness. When principal forgiveness is provided, the amortized cost basis of the loan is written off against the allowance. The amount of the principal forgiveness is deemed to be uncollectible; therefore, that portion of the loan is written off, resulting in a reduction of the amortized cost basis and a corresponding adjustment to the allowance for credit losses.

If it is determined that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or a portion of the loan) is written off. At that time, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses is adjusted by the same amount.

The following table provides a summary of the amortized cost basis of loan modifications to borrowers experiencing financial difficulty during the three and nine months ended September 30, 2025 and the related percentage of the class of the loan portfolio period-end balance by the type of modification as of September 30, 2025, excluding Consumer Program loans ($ in thousands):


	For the three months ended September 30, 2025
	Payment Deferral				Total
		$	%			$	%
Commercial real estate - owner occupied	$	—	—	%	$	—	—	%
Multi-family residential		—	—	%		—	—	%
Commercial loans		—	—	%		—	—	%
Total	$	—	—	%	$	—	—	%


	For the nine months ended September 30, 2025
	Payment Deferral				Total
		$	%			$	%
Commercial real estate - non-owner occupied	$	1,729	0.35	%	$	1,729	0.35	%
Multi-family residential		554	0.40	%		554	0.40	%
Commercial loans		24,023	2.62	%		24,023	2.62	%
Total	$	26,306	0.82	%	$	26,306	0.82	%

The following table depicts the amortized cost basis as of September 30, 2025, of the performance of loans that have been modified to borrowers experiencing financial difficulty in the last 12 months ($ in thousands):


	Payment Status

	Current		30-59 days past due		60-89 days past due		90 days or more
Commercial real estate - owner occupied	$	1,728	$	—	$	—	$	—
Commercial real estate - non-owner occupied		—		—		—		—
Residential 1-4 family		64		—		—		—
Multi- family residential		—		—		549		—
Home equity lines of credit		54		—		—		—
Commercial loans		535		—		—		23,480
Consumer loans		51		—		—		—
Total	$	2,432	$	—	$	549	$	23,480

Consumer Program Modifications

The Company began offering modifications to Consumer Program borrowers beginning on January 1, 2025, in an attempt to enhance collections of delinquent loans and mitigate charge-offs. The primary type of modifications were principal forgiveness of portions of outstanding principal owed and a combination of term modifications to extend maturity dates and interest rate reductions (primarily on promotional loans).

Table of Contents

The following table provides a summary of the loan modifications to Consumer Program borrowers experiencing financial difficulty during the three and nine months ended September 30, 2025, by the type of modification ($ in thousands):


	For the three months ended September 30, 2025							For the nine months ended September 30, 2025
		Total		Average		Average			Total		Average		Average
		Amortized		Term		Rate Change			Amortized		Term		Rate Change
	# of	Cost		Adjustment		of Modified		# of	Cost		Adjustment		of Modified
	Loans	Modified		(Years)		Loans		Loans	Modified		(Years)		Loans
Term and Interest Rate	115	$	2,359		1.4	(7.48)	%	532	$	7,767		2.2	(11.30)	%
Term only	14	$	140		2.8	N/A	%	14	$	140		2.8	N/A	%
Principal Forgiveness	100	$	411		N/A	N/A	%	246	$	1,947		N/A	N/A	%

The following table provides a status at September 30, 2025 of the amortized cost of Consumer Program loans modified since January 1, 2025 by the type of modification ($ in thousands):


	Term and
	Interest
	Rate		Term		Principal
Status	Modifications		Modifications		Modifications
Current	$	6,020	$	89	$	1,084
1-30 days past due	$	526	$	42	$	129
31-60 days past due	$	292	$	9	$	79
61-90 days past due	$	160	$	—	$	59

Credit Quality Indicators

Through its system of internal controls, Primis evaluates and segments loan portfolio credit quality using regulatory definitions for Special Mention, Substandard and Doubtful. Special Mention loans are considered “criticized”, while loans classified as Substandard or Doubtful are considered “classified”.

Special Mention loans are loans that have a potential weakness that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position.

Substandard loans may be inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful loans have all the weaknesses inherent in those classified as Substandard, with the added characteristic that the weaknesses make collection or liquidation in full, based on currently existing facts, conditions, and values, highly questionable or improbable. Primis had one loan classified as Doubtful as of September 30, 2025 and none as of December 31, 2024.

In monitoring credit quality trends in the context of assessing the appropriate level of the allowance for credit losses on loans, we monitor portfolio credit quality by the weighted-average risk grade of each class of loan.

Table of Contents

The following table presents weighted-average risk grades for all loans, by class and year of origination/renewal as of September 30, 2025 ($ in thousands):


															Revolving
															Loans
														Revolving	Converted
	2025		2024		2023		2022		2021		Prior		Loans		To Term		Total
Commercial real estate - owner occupied
Pass	$	45,461	$	52,675	$	63,695	$	77,572	$	58,661	$	181,405	$	919	$	8,077	$	488,465
Special Mention		—		—		—		—		—		3,169		—		—		3,169
Substandard		—		—		—		87		189		3,829		—		—		4,105
Doubtful		—		—		—		—		—		—		—		—		—
	$	45,461	$	52,675	$	63,695	$	77,659	$	58,850	$	188,403	$	919	$	8,077	$	495,739
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		3.39		3.21		3.52		3.41		3.42		3.46		3.97		3.74		3.43
Commercial real estate - nonowner occupied
Pass	$	6,928	$	21,512	$	47,002	$	55,100	$	41,803	$	306,879	$	10,846	$	3,345	$	493,415
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		98,800		265		—		—		99,065
Doubtful		—		—		—		—		—		—		—		—		—
	$	6,928	$	21,512	$	47,002	$	55,100	$	140,603	$	307,144	$	10,846	$	3,345	$	592,480
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		3.46		3.73		3.64		3.43		5.22		3.69		3.72		2.98		4.02
Secured by farmland
Pass	$	575	$	29	$	—	$	—	$	—	$	2,160	$	506	$	71	$	3,341
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		301		—		—		301
Doubtful		—		—		—		—		—		—		—		—		—
	$	575	$	29	$	—	$	—	$	—	$	2,461	$	506	$	71	$	3,642
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		4.00		—		N/A		N/A		N/A		4.24		3.96		2.97		4.13
Construction and land development
Pass	$	29,993	$	18,536	$	7,229	$	34,701	$	3,577	$	7,220	$	461	$	—	$	101,717
Special Mention		—		—		—		—		—		510		—		—		510
Substandard		—		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—		—
	$	29,993	$	18,536	$	7,229	$	34,701	$	3,577	$	7,730	$	461	$	—	$	102,227
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		3.11		3.03		3.90		3.65		3.03		3.53		3.65		N/A		3.37
Residential 1-4 family
Pass	$	31,120	$	29,621	$	27,165	$	146,331	$	125,803	$	190,371	$	5,467	$	2,729	$	558,607
Special Mention		—		—		—		—		—		270		—		—		270
Substandard		—		115		—		517		—		3,710		284		584		5,210
Doubtful		—		—		—		—		—		—		—		—		—
	$	31,120	$	29,736	$	27,165	$	146,848	$	125,803	$	194,351	$	5,751	$	3,313	$	564,087
Current period gross charge offs	$	—	$	—	$	67	$	—	$	—	$		$	—	$	—	$	67
Weighted average risk grade		3.07		3.14		3.09		3.09		3.04		3.20		3.19		3.94		3.13
Multi- family residential
Pass	$	6,958	$	—	$	443	$	21,503	$	23,296	$	83,110	$	1,672	$	—	$	136,982
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		549		—		273		822
Doubtful		—		—		—		—		—		—		—		—		—
	$	6,958	$	—	$	443	$	21,503	$	23,296	$	83,659	$	1,672	$	273	$	137,804
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		4.00		N/A		3.00		3.17		3.23		3.41		4.00		6.00		3.38
Home equity lines of credit
Pass	$	411	$	225	$	424	$	375	$	309	$	331	$	59,086	$	112	$	61,273
Special Mention		—		—		—		—		—		(1)		—		—		(1)
Substandard		—		—		—		—		—		(2)		557		631		1,186
Doubtful		—		—		—		—		—		—		—		—		—
	$	411	$	225	$	424	$	375	$	309	$	328	$	59,643	$	743	$	62,458
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		3.00		3.00		3.00		3.00		3.00		3.18		3.07		5.62		3.10
Commercial loans
Pass	$	87,317	$	411,775	$	69,430	$	147,394	$	26,520	$	21,457	$	88,374	$	6,550	$	858,817
Special Mention		4,987		—		—		792		2,278		1		13,510		906		22,474
Substandard		—		31		211		22,318		383		1,167		2,096		112		26,318
Doubtful		—		7,549		—		—		—		—		—		—		7,549
	$	92,304	$	419,355	$	69,641	$	170,504	$	29,181	$	22,625	$	103,980	$	7,568	$	915,158
Current period gross charge offs	$	—	$	—	$	—	$	28	$	—	$	—	$	—	$	732	$	760
Weighted average risk grade		3.35		3.12		3.37		3.42		3.91		3.36		3.53		3.89		3.30

Table of Contents


															Revolving
															Loans
														Revolving	Converted
	2025		2024		2023		2022		2021		Prior		Loans		To Term		Total
Paycheck Protection Program loans
Pass	$	—	$	—	$	—	$	—	$	853	$	870	$	—	$	—	$	1,723
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—		—
	$	—	$	—	$	—	$	—	$	853	$	870	$	—	$	—	$	1,723
Current period gross charge offs	$	—	$	—	$	—	$	—	$	173	$	—	$	—	$	—	$	173
Weighted average risk grade		N/A		N/A		N/A		N/A		2.00		2.00		N/A		N/A		2.00
Consumer loans
Pass	$	8,477	$	109,039	$	14,856	$	155,200	$	17,904	$	2,920	$	9,990	$	558	$	318,944
Special Mention		—		—		3		29		—		22		—		—		54
Substandard		8		48		84		490		330		4		—		15		979
Doubtful		—		—		—		—		—		—		—		—		—
	$	8,485	$	109,087	$	14,943	$	155,719	$	18,234	$	2,946	$	9,990	$	573	$	319,977
Current period gross charge offs	$	42	$	2,423	$	11,400	$	15,513	$	362	$	18	$	9	$	—	$	29,767
Weighted average risk grade		4.00		4.00		3.08		2.72		3.15		4.01		2.52		4.05		3.24
PCD
Pass	$	—	$	—	$	—	$	—	$	—	$	1,778	$	—	$	—	$	1,778
Special Mention		—		—		—		—		—		1,813		—		—		1,813
Substandard		—		—		—		—		—		1,348		—		—		1,348
Doubtful		—		—		—		—		—		—		—		—		—
	$	—	$	—	$	—	$	—	$	—	$	4,939	$	—	$	—	$	4,939
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		N/A		N/A		N/A		N/A		N/A		4.81		N/A		N/A		4.81
Total	$	222,235	$	651,155	$	230,542	$	662,409	$	400,706	$	815,456	$	193,768	$	23,963	$	3,200,234
Current period gross charge offs	$	42	$	2,423	$	11,467	$	15,541	$	535	$	18	$	9	$	732	$	30,767
Weighted average risk grade		3.34		3.29		3.43		3.19		3.94		3.49		3.35		3.80		3.42

Table of Contents

The following table presents weighted-average risk grades for all loans, by class and year of origination/renewal as of December 31, 2024 ($ in thousands):


															Revolving
															Loans
														Revolving	Converted
	2024		2023		2022		2021		2020		Prior		Loans		To Term		Total
Commercial real estate - owner occupied
Pass	$	41,807	$	58,979	$	79,927	$	65,362	$	14,830	$	193,528	$	1,623	$	9,280	$	465,336
Special Mention		—		—		—		—		—		3,960		—		—		3,960
Substandard		—		—		—		210		—		6,392		—		—		6,602
Doubtful		—		—		—		—		—		—		—		—		—
	$	41,807	$	58,979	$	79,927	$	65,572	$	14,830	$	203,880	$	1,623	$	9,280	$	475,898
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		3.24		3.53		3.42		3.39		3.17		3.51		3.34		3.76		3.44
Commercial real estate - nonowner occupied
Pass	$	21,857	$	37,292	$	56,104	$	117,439	$	45,057	$	295,756	$	2,486	$	3,216	$	579,207
Special Mention		—		—		—		—		—		2,904		—		—		2,904
Substandard		—		—		—		28,371		—		—		—		—		28,371
Doubtful		—		—		—		—		—		—		—		—		—
	$	21,857	$	37,292	$	56,104	$	145,810	$	45,057	$	298,660	$	2,486	$	3,216	$	610,482
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		3.72		3.55		3.17		4.13		3.84		3.68		3.14		2.91		3.74
Secured by farmland
Pass	$	270	$	68	$	—	$	4	$	76	$	2,408	$	400	$	107	$	3,333
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		378		—		—		378
Doubtful		—		—		—		—		—		—		—		—		—
	$	270	$	68	$	—	$	4	$	76	$	2,786	$	400	$	107	$	3,711
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		4.00		—		N/A		4.00		N/A		4.26		3.89		3.06		4.14
Construction and land development
Pass	$	28,796	$	22,554	$	36,762	$	3,957	$	(1)	$	8,224	$	821	$	—	$	101,113
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		130		—		—		130
Doubtful		—		—		—		—		—		—		—		—		—
	$	28,796	$	22,554	$	36,762	$	3,957	$	(1)	$	8,354	$	821	$	—	$	101,243
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		3.01		3.73		3.69		3.10		3.00		3.42		3.36		N/A		3.46
Residential 1-4 family
Pass	$	32,866	$	33,350	$	161,816	$	134,244	$	37,927	$	174,569	$	6,054	$	2,985	$	583,811
Special Mention		—		—		—		—		—		605		—		—		605
Substandard		159		263		542		—		—		2,680		262		537		4,443
Doubtful		—		—		—		—		—		—		—		—		—
	$	33,025	$	33,613	$	162,358	$	134,244	$	37,927	$	177,854	$	6,316	$	3,522	$	588,859
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	8	$	—	$	—	$	8
Weighted average risk grade		3.13		3.11		3.09		3.04		3.07		3.20		3.74		3.85		3.12
Multi- family residential
Pass	$	1,356	$	451	$	21,692	$	23,703	$	17,147	$	69,360	$	4,863	$	564	$	139,136
Special Mention		—		—		—		18,438		—		—		—		—		18,438
Substandard		—		—		—		—		—		573		—		279		852
Doubtful		—		—		—		—		—		—		—		—		—
	$	1,356	$	451	$	21,692	$	42,141	$	17,147	$	69,933	$	4,863	$	843	$	158,426
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		N/A		3.00		3.17		3.88		3.91		3.30		4.00		4.66		3.53
Home equity lines of credit
Pass	$	211	$	428	$	348	$	458	$	44	$	3,017	$	56,813	$	140	$	61,459
Special Mention		—		—		—		—		—		(1)		32		—		31
Substandard		—		—		—		—		—		11		812		641		1,464
Doubtful		—		—		—		—		—		—		—		—		—
	$	211	$	428	$	348	$	458	$	44	$	3,027	$	57,657	$	781	$	62,954
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	9	$	—	$	9
Weighted average risk grade		3.00		3.00		3.00		3.00		3.00		3.90		3.08		5.53		3.15
Commercial loans
Pass	$	152,489	$	85,049	$	179,070	$	32,374	$	4,125	$	22,008	$	97,721	$	6,781	$	579,617
Special Mention		—		—		1,276		—		—		1		1,127		—		2,404
Substandard		31		4		21,967		383		169		1,108		2,782		130		26,574
Doubtful		—		—		—		—		—		—		—		—		—
	$	152,520	$	85,053	$	202,313	$	32,757	$	4,294	$	23,117	$	101,630	$	6,911	$	608,595
Current period gross charge offs	$	—	$	383	$	—	$	—	$	—	$	196	$	347	$	—	$	926
Weighted average risk grade		3.21		3.35		3.40		3.83		3.34		3.42		3.44		3.75		3.38

Table of Contents


															Revolving
															Loans
														Revolving	Converted
	2024		2023		2022		2021		2020		Prior		Loans		To Term		Total
Paycheck Protection Program loans
Pass	$	—	$	—	$	—	$	870	$	884	$	—	$	—	$	—	$	1,754
Special Mention		—		—		—		173		—		—		—		—		173
Substandard		—		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—		—
	$	—	$	—	$	—	$	1,043	$	884	$	—	$	—	$	—	$	1,927
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		N/A		N/A		N/A		2.66		2.00		N/A		N/A		N/A		2.36
Consumer loans
Pass	$	51,194	$	17,987	$	166,307	$	21,621	$	537	$	3,044	$	7,718	$	637	$	269,045
Special Mention		—		4		59		—		—		41		—		—		104
Substandard		2		40		447		398		—		2		—		25		914
Doubtful		—		—		—		—		—		—		—		—		—
	$	51,196	$	18,031	$	166,813	$	22,019	$	537	$	3,087	$	7,718	$	662	$	270,063
Current period gross charge offs	$	19,199	$	9,777	$	19,790	$	1,293	$	—	$	33	$	—	$	—	$	50,092
Weighted average risk grade		4.27		3.37		2.88		3.29		4.00		4.01		2.46		N/A		3.22
PCD
Pass	$	—	$	—	$	—	$	—	$	—	$	1,890	$	—	$	—	$	1,890
Special Mention		—		—		—		—		—		1,960		—		—		1,960
Substandard		—		—		—		—		—		1,439		—		—		1,439
Doubtful		—		—		—		—		—		—		—		—		—
	$	—	$	—	$	—	$	—	$	—	$	5,289	$	—	$	—	$	5,289
Current period gross charge offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Weighted average risk grade		N/A		N/A		N/A		N/A		N/A		4.81		N/A		N/A		4.81
Total	$	331,038	$	256,469	$	726,317	$	448,005	$	120,795	$	795,987	$	183,514	$	25,322	$	2,887,447
Current period gross charge offs	$	19,199	$	10,160	$	19,790	$	1,293	$	—	$	237	$	356	$	—	$	51,035
Weighted average risk grade		3.29		3.41		3.17		3.59		3.50		3.49		3.31		3.75		3.39

Revolving loans that were converted to term loans during the three and nine months ended September 30, 2025 were as follows ($ in thousands):


	For the three months ended September 30, 2025		For the nine months ended September 30, 2025
Commercial real estate - non-owner occupied	$	198	$	212
Residential 1-4 family		—		157
Commercial loans		—		1,052
Total loans	$	198	$	1,421

The recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure were immaterial at September 30, 2025. There were no foreclosed residential real estate property held or in the process of foreclosure as of December 31, 2024.

Allowance For Credit Losses – Loans

The allowance for credit losses on loans is a contra-asset valuation account, calculated in accordance with ASC 326 that is deducted from the amortized cost basis of loans to present the net amount expected to be collected. The amount of the allowance represents management's best estimate of current expected credit losses on loans considering available information, from internal and external sources, relevant to assessing collectability over the loans' contractual terms, adjusted for expected prepayments when appropriate. The accounting policy related to the allowance for credit losses is considered a critical policy given the level of estimation, judgment, and uncertainty in the levels of the allowance required to account for the expected losses in the loan portfolio and the material effect such estimation, judgment, and uncertainty can have on the consolidated financial results.

In calculating the allowance for credit losses, most loans are segmented into pools based upon similar characteristics and risk profiles. For allowance modeling purposes, our loan pools include but are not limited to (i) commercial real estate - owner occupied, (ii) commercial real estate - non-owner occupied, (iii) construction and land development, (iv) commercial, (v) agricultural loans, (vi) residential 1-4 family and (vii) consumer loans. We periodically reassess each pool to ensure the loans within the pool continue to share similar characteristics and risk profiles and to determine whether further segmentation is necessary. For each loan pool, we measure expected credit losses over the life of each loan utilizing

Table of Contents

a combination of inputs: (i) probability of default, (ii) probability of attrition, (iii) loss given default and (iv) exposure at default. Internal data is supplemented by, but not replaced by, peer data when required, primarily to determine the probability of default input. The various pool-specific inputs may be adjusted for current macroeconomic assumptions. Significant macroeconomic variables utilized in our allowance models include, among other things, (i) National Gross Domestic Product, (ii) Virginia House Price Index, and (iii) Virginia unemployment rates.

Management applies qualitative adjustments to model results for risk factors that are not considered within our quantitative modeling processes but are nonetheless relevant in assessing the expected credit losses within our loan pools. Qualitative factor (“Q-Factor”) adjustments are driven by key risk indicators that management tracks on a pool-by-pool basis.

In some cases, management may determine that an individual loan exhibits unique risk characteristics which differentiate the loan from other loans within our loan pools. In such cases, the loans are evaluated for expected credit losses on an individual basis and excluded from the collective evaluation.

The following tables present details of the allowance for credit losses on loans segregated by loan portfolio segment as of September 30, 2025 and December 31, 2024, calculated in accordance with ASC 326 ($ in thousands).


	Commercial		Commercial										Home
	Real Estate		Real Estate				Construction						Equity
	Owner		Non-owner		Secured by		and Land		1-4 Family		Multi-Family		Lines Of		Commercial		Consumer		PCD
September 30, 2025	Occupied		Occupied		Farmland		Development		Residential		Residential		Credit		Loans		Loans		Loans		Total
Modeled expected credit losses	$	4,997		4,158		1		694		6,151		745		421		4,811		2,743	$	—	$	24,721
Q-factor and other qualitative adjustments		447		1,022		30		86		527		652		17		379		526				3,686
Specific allocations		334		9,451		—		—		—		—		—		5,204		1,156		214		16,359
Total	$	5,778	$	14,631	$	31	$	780	$	6,678	$	1,397	$	438	$	10,394	$	4,425	$	214	$	44,766

	Commercial		Commercial										Home
	Real Estate		Real Estate				Construction						Equity
	Owner		Non-owner		Secured by		and Land		1-4 Family		Multi-Family		Lines Of		Commercial		Consumer		PCD
December 31, 2024	Occupied		Occupied		Farmland		Development		Residential		Residential		Credit		Loans		Loans		Loans		Total
Modeled expected credit losses	$	4,623	$	4,194	$	1	$	1,045	$	6,423	$	971	$	511	$	4,062	$	3,932	$	—	$	25,762
Q-factor and other qualitative adjustments		321		698		19		158		396		649		22		694		362		—		3,319
Specific allocations		955		2,074		—		—		—		—		—		6,038		15,331		245		24,643
Total	$	5,899	$	6,966	$	20	$	1,203	$	6,819	$	1,620	$	533	$	10,794	$	19,625	$	245	$	53,724

No allowance for credit losses has been recognized for PPP loans as such loans are fully guaranteed by the SBA.

Table of Contents

Activity in the allowance for credit losses by class of loan for the three and nine months ended September 30, 2025 and 2024 is summarized below ($ in thousands):


	Commercial		Commercial
	Real Estate		Real Estate				Construction						Home Equity
For the Three Months Ended	Owner		Non-owner		Secured by		and Land		1-4 Family		Multi-Family		Lines Of		Commercial		Consumer		PCD
September 30, 2025	Occupied		Occupied		Farmland		Development		Residential		Residential		Credit		Loans		Loans		Loans		Total
Allowance for credit losses:
Beginning balance	$	5,727	$	13,987	$	29	$	1,057	$	6,340	$	1,456	$	462	$	11,535	$	5,175	$	217	$	45,985
Provision (recovery)		51		644		2		(277)		338		(59)		(25)		(1,140)		420		(3)		(49)
Charge offs		—		—		—		—		—		—		—		(1)		(3,700)		—		(3,701)
Recoveries		—		—		—		—		—		—		1		—		2,530		—		2,531
Ending balance	$	5,778	$	14,631	$	31	$	780	$	6,678	$	1,397	$	438	$	10,394	$	4,425	$	214	$	44,766

For the Three Months Ended
September 30, 2024
Allowance for credit losses:
Beginning balance	$	4,892	$	5,459	$	26	$	890	$	5,926	$	2,035	$	364	$	6,124	$	25,251	$	607	$	51,574
Provision (recovery)		475		1,564		(5)		178		576		(271)		191		117		5,007		(321)		7,511
Charge offs		—		—		—		—		—		—		—		(580)		(7,840)		—		(8,420)
Recoveries		31		—		—		—		—		—		1		18		417		—		467
Ending balance	$	5,398	$	7,023	$	21	$	1,068	$	6,502	$	1,764	$	556	$	5,679	$	22,835	$	286	$	51,132


	Commercial		Commercial
	Real Estate		Real Estate				Construction						Home Equity
For the Nine Months Ended	Owner		Non-owner		Secured by		and Land		1-4 Family		Multi-Family		Lines Of		Commercial		Consumer		PCD
September 30, 2025	Occupied		Occupied		Farmland		Development		Residential		Residential		Credit		Loans		Loans		Loans		Total
Allowance for credit losses:
Beginning balance	$	5,899	$	6,966	$	20	$	1,203	$	6,819	$	1,620	$	533	$	10,794	$	19,625	$	245	$	53,724
Provision (recovery)		(121)		7,665		11		(423)		(74)		(223)		(98)		533		2,611		(31)		9,850
Charge offs		—		—		—		—		(67)		—		—		(933)		(29,767)		—		(30,767)
Recoveries		—		—		—		—		—		—		3		—		11,956		—		11,959
Ending balance	$	5,778	$	14,631	$	31	$	780	$	6,678	$	1,397	$	438	$	10,394	$	4,425	$	214	$	44,766

For the Nine Months Ended
September 30, 2024
Allowance for credit losses:
Beginning balance	$	4,255	$	5,822	$	31	$	1,129	$	4,938	$	1,590	$	364	$	6,320	$	26,088	$	1,672	$	52,209
Provision (recovery)		1,112		1,201		(10)		(61)		1,562		174		189		265		14,092		(1,386)		17,138
Charge offs		—		—		—		—		—		—		—		(926)		(19,136)		—		(20,062)
Recoveries		31		—		—		—		2		—		3		20		1,791		—		1,847
Ending balance	$	5,398	$	7,023	$	21	$	1,068	$	6,502	$	1,764	$	556	$	5,679	$	22,835	$	286	$	51,132

Generally, a commercial loan, or a portion thereof, is charged-off when it is determined, through the analysis of any available current financial information with regards to the borrower, that the borrower is incapable of servicing unsecured debt, there is little or no prospect for near term improvement and no realistic strengthening action of significance is pending or, in the case of secured debt, when it is determined, through analysis of current information with regards to our collateral position, that amounts due from the borrower are in excess of the calculated current fair value of the collateral. Losses on installment loans are recognized in accordance with regulatory guidelines. All other consumer loan losses are recognized when delinquency exceeds 120 cumulative days except for the Consumer Program loans that are charged-off once they become 90 days past due.

Table of Contents

The following table presents the principal balance of loans that were evaluated for expected credit losses on an individual basis and the related specific allocations, by loan portfolio segment as of September 30, 2025 and December 31, 2024 ($ in thousands):


	September 30, 2025				December 31, 2024
	Loan		Specific		Loan		Specific
	Balance		Allocations		Balance		Allocations
Commercial real estate - owner occupied	$	3,742	$	334	$	6,266	$	955
Commercial real estate - non-owner occupied		99,233		9,451		28,764		2,074
Secured by farmland		271		—		378		—
Construction and land development		396		—		—		—
Residential 1-4 family		2,967		—		2,268		—
Multi- family residential		821		—		852		—
Home equity lines of credit		618		—		628		—
Commercial loans		33,090		5,204		25,947		6,038
Consumer loans		6,119		1,156		22,885		15,331
Total non-PCD loans		147,257		16,145		87,988		24,398
PCD loans		4,909		214		5,289		245
Total loans	$	152,166	$	16,359	$	93,277	$	24,643

The following table presents a breakdown between loans at amortized cost that were evaluated on an individual basis and identified as collateral dependent loans and non-collateral dependent loans, by loan portfolio segment and their collateral value as of September 30, 2025 and December 31, 2024 ($ in thousands):


	September 30, 2025				December 31, 2024
			Non				Non
	Collateral		Collateral		Collateral		Collateral
	Dependent		Dependent		Dependent		Dependent
	Assets ⁽¹⁾		Assets ⁽¹⁾		Assets ⁽¹⁾		Assets ⁽¹⁾
Commercial real estate - owner occupied	$	3,528	$	—	$	4,229	$	—
Commercial real estate - non-owner occupied		30,033		70,573		30,130		—
Secured by farmland		1,159		—		1,277		—
Construction and land development		396		—		—		—
Residential 1-4 family		3,728		—		3,038		—
Multi- family residential		826		—		857		—
Home equity lines of credit		618		—		635		—
Commercial loans		32,956		—		26,424		—
Total loans	$	73,244	$	70,573	$	66,590	$	—

Collateral value	$	84,910	$	—	$	75,375	$	—

(1)	Loan balances include PCD loans and are presented net of SBA guarantees.

Table of Contents

4. DERIVATIVES

Consumer Program Derivative

The Company has a derivative instrument in connection with its agreement with a third-party that originates loans that are held on the Company’s balance sheet. The third-party provides credit support and reimbursement for lost interest under the agreement, and the Company provides performance fees to the third-party on performing loans. Specifically, a portion of the originated loans are originated with a promotional period where interest accrues on the loans but is not owed to the Company unless and until the loan begins to amortize. If the borrower prepays the principal on the loan prior to the end of the promotional period, the accrued interest is waived but becomes due to the Company from the third-party under the agreement. This expected payment of waived interest to the Company along with performance fees due to the third-party comprise the value of the derivative. The fair value of the derivative instrument was an asset of immaterial value and $5 million as of September 30, 2025 and December 31, 2024, respectively. The underlying cash flows were immaterial and $5 million as of September 30, 2025 and December 31, 2024, respectively. The Company calculates the fair value of this derivative using a discounted cash flow model using inputs that are inherently judgmental and reflect management’s best estimates of the assumptions a market participant would use to calculate the fair value. The most significant inputs and assumptions in determining the value of the derivative are noted below ($ in thousands).


	September 30, 2025
					Weighted
	Low		High		Average
Remaining cumulative charge-offs	$	40,757	$	47,243		n/a
Remaining cumulative promotional prepayments ⁽¹⁾	$	3,635	$	7,270	$	5,453
Average life (years)		n/a		n/a		0.6
Discount rate		3.99%		14.56%		14.56%

	December 31, 2024
					Weighted
	Low		High		Average
Remaining cumulative charge-offs	$	28,387	$	41,994		n/a
Remaining cumulative promotional prepayments ⁽¹⁾	$	24,322	$	53,661	$	34,366
Average life (years)		n/a		n/a		0.5
Discount rate		4.28%		14.39%		14.39%

(1)	Reflects principal amount expected to be prepaid.

Mortgage Banking Derivatives and Financial Instruments

The Company enters into IRLCs to originate residential mortgage loans held for sale, at specified interest rates and within a specified period of time (generally between 30 and 90 days), with borrowers who have applied for a loan and have met certain credit and underwriting criteria. The IRLCs are adjusted for estimated costs to originate the loan as well as the probability that the mortgage loan will fund within the terms of the IRLC (the pull through rate). Estimated costs to originate include loan officer commissions and overrides. The pull through rate is estimated on changes in market conditions, loan stage, and actual borrower behavior using a historical analysis of IRLC closing rates. The Company obtains an analysis from a third party on a monthly basis to support the reasonableness of the pull through estimate.

Best efforts and mandatory forward loan sale commitments are commitments to sell individual mortgage loans using both best efforts and mandatory delivery at a fixed price to an investor at a future date. Forward loan sale commitments that are mandatory delivery are accounted for as derivatives and carried at fair value, determined as the amount that would be necessary to settle the derivative financial instrument at the balance sheet date. Forward loan sale commitments that are best efforts are not derivatives but can be and have been accounted for at fair value, determined in a similar manner to those that are mandatory delivery. Forward loan sale commitments are recorded on the balance sheet as derivative assets

Table of Contents

and derivative liabilities with changes in their fair values recorded in mortgage banking income in the statement of operations.

The key unobservable inputs used in determining the fair value of IRLCs are as follows as of September 30, 2025 and December 31, 2024:


	September 30, 2025		December 31, 2024
Average pull through rates	85.8	%	89.2	%
Average costs to originate	1.3	%	1.3	%

The following summarizes derivative and non-derivative financial instruments as of September 30, 2025 and December 31, 2024 ($ in thousands):


	September 30, 2025
	Fair		Notional
Derivative financial instruments:	Value		Amount
Derivative assets ⁽¹⁾	$	1,908	$	78,892
Derivative liabilities	$	—	$	—

	September 30, 2025
	Fair		Notional
Non-derivative financial instruments:	Value		Amount
Best efforts assets	$	174	$	14,067

	December 31, 2024
	Fair		Notional
Derivative financial instruments:	Value		Amount
Derivative assets ⁽¹⁾	$	1,000	$	34,593
Derivative liabilities	$	—	$	—

	December 31, 2024
	Fair		Notional
Non-derivative financial instruments:	Value		Amount
Best efforts assets	$	82	$	6,352

(1)	Pull through rate adjusted.

The notional amounts of mortgage loans held for sale not committed to investors was $74 million and $55 million as of September 30, 2025 and December 31, 2024, respectively.

The Company has exposure to credit loss in the event of contractual non-performance by its trading counterparties in derivative instruments that the Company uses in its rate risk management activities. The Company manages this credit risk by selecting only counterparties that the Company believes to be financially strong, spreading the risk among multiple counterparties, by placing contractual limits on the amount of unsecured credit extended to any single counterparty and by entering into netting agreements with counterparties, as appropriate.

Table of Contents

5. FAIR VALUE

ASC 820 establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data

Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability

Assets and liabilities measured at fair value on a recurring basis are summarized below:


			Fair Value Measurements Using
					Significant
			Quoted Prices in		Other		Significant
			Active Markets for		Observable		Unobservable
	Total at		Identical Assets		Inputs		Inputs
(dollars in thousands)	September 30, 2025		(Level 1)		(Level 2)		(Level 3)
Assets:
Available-for-sale securities
Residential government-sponsored mortgage-backed securities	$	92,653	$	—	$	92,653	$	—
Obligations of states and political subdivisions		28,977		—		28,977		—
Corporate securities		9,220		—		9,220		—
Residential government-sponsored collateralized mortgage obligations		60,819		—		60,819		—
Government-sponsored agency securities		14,530		—		14,530		—
Agency commercial mortgage-backed securities		21,942		—		21,942		—
SBA pool securities		6,519		—		6,519		—
		234,660		—		234,660		—
Loans held for investment		150,103		—		150,103		—
Loans held for sale, at fair value		148,781		—		148,781		—
Consumer Program derivative		409		—		—		409
Mortgage banking financial assets		174		—		—		174
Mortgage banking derivative assets		1,908		—		—		1,908
Investment in Panacea Financial Holdings, Inc. common stock ⁽¹⁾		6,880		—		—		6,880
Total assets	$	542,915	$	—	$	533,544	$	9,371

Liabilities:
Interest rate swaps, net	$	137	$	—	$	137	$	—

(1)

Inputs and assumptions utilized in determining the fair value are discussed in “PFH Deconsolidation and Sale of Shares” in footnote 1, Accounting Policies.

Table of Contents


			Fair Value Measurements Using
					Significant
			Quoted Prices in		Other		Significant
			Active Markets for		Observable		Unobservable
	Total at		Identical Assets		Inputs		Inputs
(dollars in thousands)	December 31, 2024		(Level 1)		(Level 2)		(Level 3)
Assets:
Available-for-sale securities
Residential government-sponsored mortgage-backed securities	$	91,407	$	—	$	91,407	$	—
Obligations of states and political subdivisions		29,705		—		29,705		—
Corporate securities		15,080		—		15,080		—
Residential government-sponsored collateralized mortgage obligations		56,390		—		56,390		—
Government-sponsored agency securities		13,836		—		13,836		—
Agency commercial mortgage-backed securities		22,178		—		22,178		—
SBA pool securities		7,307		—		7,307		—
		235,903		—		235,903		—
Loans held for investment		249,190		—		249,190		—
Loans held for sale, at fair value		83,276		—		83,276		—
Consumer Program derivative		4,511		—		—		4,511
Mortgage banking financial assets		82		—		—		82
Mortgage banking derivative assets		1,000		—		—		1,000
Total assets	$	573,962	$	—	$	568,369	$	5,593

Assets measured at fair value on a non-recurring basis are summarized below:

Fair Value Measurements Using

Significant

Quoted Prices in

Other

Significant

Active Markets for

Observable

Unobservable

Total at

Identical Assets

Inputs

(dollars in thousands)

September 30, 2025

(Level 1)

(Level 2)

(Level 3)

Collateral dependent loans

73,244

—

73,244

Assets held for sale

775

—

775


			Fair Value Measurements Using
					Significant
			Quoted Prices in		Other		Significant
			Active Markets for		Observable		Unobservable
	Total at		Identical Assets		Inputs		Inputs
(dollars in thousands)	December 31, 2024		(Level 1)		(Level 2)		(Level 3)
Collateral dependent loans	$	66,590	$	—	$	—	$	66,590
Loans held for sale, at lower of cost or market		163,832		50,662		113,170		—
Assets held for sale		5,497		—		—		5,497

Table of Contents

Fair Value of Financial Instruments

The carrying amount, estimated fair values and fair value hierarchy levels of financial instruments were as follows ($ in thousands) for the periods indicated:


		September 30, 2025				December 31, 2024
	Fair Value	Carrying		Fair		Carrying		Fair
	Hierarchy Level	Amount		Value		Amount		Value
Financial assets:
Cash and cash equivalents	Level 1	$	63,881	$	63,881	$	64,505	$	64,505
Securities available-for-sale	Level 2		234,660		234,660		235,903		235,903
Securities held-to-maturity	Level 2		8,550		8,037		9,448		8,602
Stock in Federal Reserve Bank and Federal Home Loan Bank	Level 2		17,035		17,035		13,037		13,037
Preferred investment in mortgage company	Level 2		3,005		3,005		3,005		3,005
Net loans	Level 2 and 3		3,155,468		3,056,805		2,833,723		2,564,623
Loans held for sale, at fair value	Level 2		148,781		148,781		83,276		83,276
Loans held for sale, at lower of cost or market	Level 1 and 2		53,591		53,591		163,832		163,832
Consumer Program derivative	Level 3		409		409		4,511		4,511
Mortgage banking financial assets	Level 3		174		174		82		82
Mortgage banking derivative assets	Level 3		1,908		1,908		1,000		1,000
Interest rate swaps, net	Level 2		—		—		752		752
Investment in Panacea Financial Holdings, Inc. common stock	Level 3		6,880		6,880		—		—
Financial liabilities:
Demand deposits and NOW accounts	Level 2	$	1,321,437	$	1,321,437	$	1,256,632	$	1,256,632
Money market and savings accounts	Level 2		1,696,050		1,696,050		1,574,225		1,574,225
Time deposits	Level 3		318,865		318,439		340,178		339,767
Securities sold under agreements to repurchase	Level 1		3,954		3,954		3,918		3,918
Interest rate swaps, net	Level 2		137		137		—		—
FHLB advances	Level 1		85,000		85,000		—		—
Junior subordinated debt	Level 2		9,917		8,941		9,880		9,016
Senior subordinated notes	Level 2		86,174		87,027		85,998		85,987
Secured borrowings	Level 3		15,403		15,403		17,195		17,195

The carrying amount is the estimated fair value for cash and cash equivalents, loans held for sale, mortgage banking financial assets and liabilities, mortgage banking derivative assets and liabilities, Consumer Program derivative, interest rate swaps, demand deposits and NOW accounts, savings accounts, money market accounts, FHLB advances, secured borrowings and securities sold under agreements to repurchase.

The fair value of junior subordinated debt and senior subordinated notes are based on current rates for similar financing. The carrying amount of Federal Reserve Bank and FHLB stock is a reasonable estimate of fair value as these securities are not readily marketable and are based on the ultimate recoverability of the par value. The fair value of off-balance-sheet items is not considered material. The fair value of net loans, time deposits, junior subordinated debt, and senior subordinated notes are measured using the exit-price notion. The net loans that use level 2 inputs are related to the portfolio of loans underlying our interest rate swaps as previously discussed in “Note 1 – Accounting Policies”.

Table of Contents

6. LEASES

The Company leases certain premises under operating leases. In recognizing lease right-of-use assets and related liabilities, we account for lease and non-lease components (such as taxes, insurance, and common area maintenance costs) separately as such amounts are generally readily determinable under our lease contracts. As of September 30, 2025 and December 31, 2024, the Company had operating lease liabilities totaling $11 million and $12 million, respectively, and right-of-use assets totaling $9 million and $10 million, respectively, reflected in our condensed consolidated balance sheets related to these leases. We do not currently have any financing leases. For the three months ended September 30, 2025 and 2024, our net operating lease costs were $1 million, and for the nine months ended September 30, 2025 and 2024, our net operating lease costs were $2 million for both periods. These net operating lease costs are reflected in occupancy expenses on our condensed consolidated statements of income.

The following table presents other information related to our operating leases:


	For the Nine Months Ended
	September 30, 2025			September 30, 2024
Other information:
Weighted-average remaining lease term - operating leases, in years		5.6			6.6
Weighted-average discount rate - operating leases		4.1	%		4.0	%

The following table summarizes the maturity of remaining lease liabilities:



	As of
(dollars in thousands)	September 30, 2025
Lease payments due:
2025	$	623
2026		2,471
2027		2,414
2028		2,164
2029		1,617
Thereafter		2,714
Total lease payments		12,003
Less: imputed interest		(1,321)
Lease liabilities	$	10,682

As of September 30, 2025, the Company did not have any operating lease that has not yet commenced that will create additional lease liabilities and right-of-use assets.

Table of Contents

7. DEBT AND OTHER BORROWINGS

Other borrowings can consist of FHLB convertible advances, FHLB overnight advances, FHLB advances maturing within one year, federal funds purchased, Federal Reserve Board Discount Window, secured borrowings and securities sold under agreements to repurchase (“repo”) that mature within one year, which are secured transactions with customers. The balance in repo accounts as of September 30, 2025 and December 31, 2024 was $4 million.

As of September 30, 2025 and December 31, 2024, we had pledged callable agency securities, residential government-sponsored mortgage-backed securities and collateralized mortgage obligations with a carrying value of $7 million to customers who require collateral for overnight repurchase agreements and deposits.

As of September 30, 2025, Primis Bank had lendable collateral value in the form of residential 1-4 family mortgages, HELOCs, commercial mortgage loans, and investment securities supporting borrowing capacity of approximately $537 million from the FHLB.

In June 2023, the Bank took the necessary steps to participate in the Federal Reserve discount window borrowing program. As of September 30, 2025, the Bank had borrowing capacity of $595 million within the program and has not borrowed under the program.

In 2017, the Company assumed $10 million of trust preferred securities that were issued on September 17, 2003 and placed through a trust in a pooled underwriting totaling approximately $650 million. As of September 30, 2025 and December 31, 2024, there was $10 million outstanding, net of approximately $394 thousand and $431 thousand of debt issuance costs as of September 30, 2025 and December 31, 2024, respectively. As of September 30, 2025 and December 31, 2024, the interest rate payable on the trust preferred securities was 7.23% and 7.56%, respectively. As of September 30, 2025, all of the trust preferred securities qualified as Tier 1 capital.

On January 20, 2017, Primis completed the sale of $27 million of its fixed-to-floating rate senior Subordinated Notes due 2027. Interest is currently payable at an annual floating rate equal to three-month CME Term SOFR plus a tenor spread adjustment of 0.26% until maturity or early redemption. As of September 30, 2025, 20% of these Subordinated Notes qualified as Tier 2 capital.

On August 25, 2020, Primis completed the sale of $60 million of its fixed-to-floating rate Subordinated Notes due 2030. Interest was payable at an initial annual fixed rate of 5.40% and after September 1, 2025, at a floating rate equal to Three-Month Term SOFR, plus a spread of 531 basis points. As of September 30, 2025, all of these notes qualified as Tier 2 capital.

As of September 30, 2025, and December 31, 2024, the remaining unamortized debt issuance costs related to the senior Subordinated Notes totaled $1 million.

Secured Borrowings

The Company transferred $1 million and $23 million in principal balance of loans to another financial institution in 2024 and 2023, respectively, that were accounted for as secured borrowings. The balance of secured borrowings was $15 million and $17 million as of September 30, 2025, and December 31, 2024, respectively, and the remaining amortized cost balance of the underlying loans was $15 million and $17 million, respectively. None of the loans underlying the secured borrowings were past due 30 days or greater or on nonaccrual as of September 30, 2025 and December 31, 2024, and were all internally rated as “pass” loans as presented in our “credit quality indicators” section of “Note 3 – Loans and Allowance for Credit Losses”. The loans were included in our allowance for credit losses process and an allowance was calculated on the loans as part of their inclusion in a pool with other loans with similar credit risk characteristics. There were no charge-offs of the loans underlying the secured borrowings during the three and nine months ended September 30, 2025. The underlying loans collateralize the borrowings and cannot be sold or pledged by the Company.

Table of Contents

8. STOCK-BASED COMPENSATION

The 2017 Equity Compensation Plan (the “2017 Plan”) has a maximum number of 750,000 shares reserved for issuance. The purpose of the 2017 Plan is to promote the success of the Company by providing greater incentives to employees, non-employee directors, consultants and advisors to associate their personal financial interests with the long-term financial success of the Company, including its subsidiaries, and with growth in stockholder value, consistent with the Company’s risk management practices.

A summary of stock option activity for the nine months ended September 30, 2025, follows:


				Weighted
		Weighted		Average	Aggregate
		Average		Remaining	Intrinsic
		Exercise		Contractual	Value
	Shares	Price		Term (Yrs)	(in thousands)
Options outstanding, beginning of period	35,800	$	11.73	1.0	$	4
Expired	(16,800)		11.43
Exercised	(1,200)		11.99
Options outstanding, end of period	17,800	$	12.00	0.7		—

Exercisable at end of period	17,800	$	12.00	0.7		—

There was no stock-based compensation expense associated with stock options for the three and nine months ended September 30, 2025 and 2024. As of September 30, 2025, we do not have any unrecognized compensation expense associated with the stock options.

A summary of time vested restricted stock awards for the nine months ended September 30, 2025, follows:


		Weighted		Weighted
		Average		Average
		Grant-Date		Remaining
		Fair Value		Contractual
	Shares	Per Share		Term (Yrs)
Unvested restricted stock outstanding, beginning of period	20,900	$	13.18	1.8
Vested	(9,050)		15.15
Unvested restricted stock outstanding, end of period	11,850	$	11.67	2.0

Stock-based compensation expense for time vested restricted stock awards totaled $12 thousand and $41 thousand for the three months ended September 30, 2025 and 2024, respectively, and $61 thousand and $312 thousand for the nine months ended September 30, 2025 and 2024, respectively. Unrecognized compensation expense associated with restricted stock awards was $81 thousand, which is expected to be recognized over the remaining contractual term.

A summary of performance-based restricted stock units (the “Units”) for the nine months ended September 30, 2025, follows:


			Weighted	Weighted
			Average	Average
			Grant-Date	Remaining
			Fair Value	Contractual
	Shares		Per Share	Term (Yrs)
Unvested Units outstanding, beginning of period	223,460	$	11.79	2.1
Forfeited	—		—
Unvested Units outstanding, end of period	223,460		11.79	1.3

Table of Contents

These Units are subject to service and performance conditions and vest based on the achievement of both conditions. Achievement of the performance condition will be determined at the end of the five-year performance period (the “Performance Period”) by evaluating the: (1) Company’s adjusted earnings per share compound annual growth measured for the Performance Period and (2) performance factor achieved. Payouts between performance levels will be determined based on straight line interpolation.

The Company recognized no stock-based compensation expense during the three and nine months ended September 30, 2025, and 2024 as a result of the probability of a portion of the Units vesting because it is not probable that these Units will vest. The potential unrecognized compensation expense associated with these Units was $4 million as of both September 30, 2025 and December 31, 2024.

Table of Contents

9. COMMITMENTS AND CONTINGENCIES

Financial Instruments with Off-Balance Sheet Risk

Primis is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit, standby letters of credit and guarantees of credit card accounts. These instruments involve elements of credit and funding risk in excess of the amounts recognized in the consolidated balance sheets. Letters of credit are written conditional commitments issued by Primis to guarantee the performance of a customer to a third party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loans to customers. The Company had letters of credit outstanding totaling $20 million and $10 million as of September 30, 2025 and December 31, 2024, respectively.

The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instruments for commitments to extend credit and letters of credit is based on the contractual amount of these instruments. Primis uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. Unless noted otherwise, we do not require collateral or other security to support financial instruments with credit risk.

Allowance For Credit Losses - Off-Balance-Sheet Credit Exposures

The allowance for credit losses on off-balance sheet credit exposures is a liability account, calculated in accordance with ASC 326, representing expected credit losses over the contractual period for which Primis is exposed to credit risk resulting from a contractual obligation to extend credit. No allowance is recorded if the Company has the unconditional right to cancel the obligation. Off-balance sheet credit exposures primarily consist of amounts available under outstanding lines of credit and letters of credit detailed above. For the period of exposure, the estimate of expected credit losses considers both the likelihood that funding will occur, and the amount expected to be funded over the estimated remaining life of the commitment or other off-balance sheet exposure. The likelihood and expected amount of funding are based on historical utilization rates. The amount of the allowance represents management's best estimate of expected credit losses on commitments expected to be funded over the contractual life of the commitment. Estimating credit losses on amounts expected to be funded uses the same methodology as described for loans in Note 3 - Loans and Allowance for Credit Losses, as if such commitments were funded. The allowance for credit losses on off-balance sheet credit exposures is reflected in other liabilities in the condensed consolidated balance sheets.

The following table details activity in the allowance for credit losses on off-balance-sheet credit exposures ($ in thousands):


	2025		2024
Balance as of January 1	$	1,121	$	1,579
Credit loss expense (benefit)		12		(452)
Balance as of September 30	$	1,133	$	1,127

Commitments

Commitments to extend credit are agreements to lend to a customer if there is no violation of any condition established in the contract. Commitments are made predominately for adjustable-rate loans, and generally have fixed expiration dates of up to three months or other termination clauses and usually require payment of a fee. Since many of the commitments may expire without being completely drawn upon, the total commitment amounts do not necessarily represent future cash requirements. We evaluate each customer’s creditworthiness on a case-by-case basis.

The Company had $167 million of mortgage loan commitments outstanding as of September 30, 2025. These commitments have a contractual expiry from 15 to 30 years.

As of September 30, 2025 and December 31, 2024, we had unfunded lines of credit and undisbursed construction loan funds totaling $493 million and $459 million, respectively, not all of which are expected to be drawn. Virtually all of our unfunded lines of credit and undisbursed construction loan funds are variable rate instruments. The amount of certificate

Table of Contents

of deposit accounts maturing in less than one year was $276 million as of September 30, 2025. Management anticipates that funding requirements for these commitments will be met in the normal course of business.

Primis also had outstanding commitments under subscription agreements entered into for investments in non-marketable equity securities of $1 million as of September 30, 2025 and December 31, 2024.

Table of Contents

10. EARNINGS PER SHARE

The following is a reconciliation of the denominators of the basic and diluted EPS computations ($ in thousands, except per share data):


			Weighted
			Average
	Income		Shares	Per Share
	(Numerator)		(Denominator)	Amount
For the three months ended September 30, 2025
Basic EPS	$	6,830	24,632	$	0.28
Effect of dilutive stock options and unvested restricted stock		—	12		—
Diluted EPS	$	6,830	24,644	$	0.28

For the three months ended September 30, 2024
Basic EPS	$	1,228	24,696	$	0.05
Effect of dilutive stock options and unvested restricted stock		—	24		—
Diluted EPS	$	1,228	24,720	$	0.05

For the nine months ended September 30, 2025
Basic EPS	$	31,903	24,680	$	1.29
Effect of dilutive stock options and unvested restricted stock		—	13		—
Diluted EPS	$	31,903	24,693	$	1.29

For the nine months ended September 30, 2024
Basic EPS	$	7,130	24,684	$	0.29
Effect of dilutive stock options and unvested restricted stock		—	26		—
Diluted EPS	$	7,130	24,710	$	0.29

The Company had 17,800 anti-dilutive options as of September 30, 2025. The Company did not have any anti-dilutive options as of September 30, 2024.

Table of Contents

11. SEGMENT INFORMATION

The Company’s reportable operating segments are determined based on its internal organizational structure, which is overseen by the CEO, the Company’s designated Chief Operating Decision Maker. While the CEO consults with key members of his leadership team, the ultimate responsibility for making operational decisions and resource allocations resides with the CEO. For the nine months ended September 30, 2025 and 2024, the Company’s internal organizational structure and resulting management reporting was concentrated around the Bank and Primis Mortgage, which resulted in the Company determining these to be its two reportable segments.

Primis’ organizational structure and its operational segments are determined by attributes such as products, services, and customer base, which are then aggregated based on similarities around these attributes. The operating results for each segment are regularly reviewed by the CEO using a broad set of financial and operational data. Key financial data utilized by the CEO to assess financial performance and allocate resources includes loan and deposit growth, certain direct expenses, net interest income and mortgage banking income, along with overall net income attributable to Primis’ common shareholders. The CEO also considers actual results compared to budgeted results in these metrics when assessing performance and making determinations related to resource allocations. The following is a description of the Company’s reportable segments.

Primis Bank. This segment specializes in providing financing services to businesses in various industries along with consumer and residential loans to individuals. The segment also provides deposit-related services to businesses, non-profits, municipalities, and individual consumers. The primary source of revenue for this segment is interest income from the origination of loans, while the primary expenses are interest expenses on deposits, provisions for loan losses, personnel costs, and data processing expenses.

Primis Mortgage. This segment specializes in originating mortgages in a majority of the U.S. The primary source of revenue for this segment is noninterest income generated from the origination and sale of mortgage loans, while the primary expense of the segment is personnel costs.

Table of Contents

The following table provides financial information for the Company's reportable segments. In addition to the Company’s two reportable segments as described above, the caption “Other” has been included to provide reconciliation of the Company’s consolidated results and includes operational costs that are not a part of the two reportable segments but don’t qualify to be considered a separate reportable segment. “Other” primarily includes the Primis Bank Holding Company and PFH, which are generally cost centers to the consolidated entity, along with elimination adjustments to reconcile the results of the reportable segments to the consolidated financial statements prepared in conformity with GAAP.


	As of and for the three months ended September 30, 2025								As of and for the nine months ended September 30, 2025
($ in thousands)	Primis Mortgage		Primis Bank		Other ⁽¹⁾		Consolidated		Primis Mortgage		Primis Bank		Other ⁽¹⁾		Consolidated Company

Interest income	$	2,085	$	49,636	$	45	$	51,766	$	4,895	$	142,075	$	146	$	147,116
Interest expense		—		20,888		1,846		22,734		—		61,393		5,147		66,540
Net interest income		2,085		28,748		(1,801)		29,032		4,895		80,682		(5,001)		80,576
Provision (benefit) for loan losses		—		(49)		—		(49)		—		9,850		—		9,850
Net interest income after provision (benefit) for loan losses		2,085		28,797		(1,801)		29,081		4,895		70,832		(5,001)		70,726

Noninterest income:
Mortgage banking income		8,927		(40)		—		8,887		23,040		(645)		—		22,395
Other noninterest income		—		2,436		646		3,082		—		6,953		32,986		39,939
Total noninterest income		8,927		2,396		646		11,969		23,040		6,308		32,986		62,334

Noninterest expenses:
Salaries and benefits		7,348		10,973		202		18,523		19,756		29,790		3,978		53,524
Data processing expense		221		2,148		—		2,369		544		7,711		—		8,255
Other operating expenses		731		10,553		137		11,421		2,960		30,243		1,789		34,992
Total noninterest expenses		8,300		23,674		339		32,313		23,260		67,744		5,767		96,771
Income before income taxes		2,712		7,519		(1,494)		8,737		4,675		9,396		22,218		36,289
Income tax expense (benefit)		624		1,599		(316)		1,907		1,070		2,138		4,780		7,988
Net income (loss)		2,088		5,920		(1,178)		6,830		3,605		7,258		17,438		28,301
Net loss attributable to noncontrolling interests		—		—		—		—		—		—		3,602		3,602
Net income attributable to Primis' common stockholders	$	2,088	$	5,920	$	(1,178)	$	6,830	$	3,605	$	7,258	$	21,040	$	31,903

Total assets	$	164,680	$	3,934,341	$	(144,172)	$	3,954,849	$	164,680	$	3,934,341	$	(144,172)	$	3,954,849

(1)

Other includes Primis Bank Holding Company, PFH, and intercompany eliminations.

Table of Contents


	As of and for the three months ended September 30, 2024								As of and for the nine months ended September 30, 2024
($ in thousands)	Primis Mortgage		Primis Bank		Other ⁽¹⁾		Consolidated		Primis Mortgage		Primis Bank		Other ⁽¹⁾		Consolidated Company

Interest income	$	1,589	$	55,471	$	52	$	57,112	$	4,018	$	155,473	$	165	$	159,656
Interest expense		—		27,347		1,742		29,089		—		76,288		5,223		81,511
Net interest income		1,589		28,124		(1,690)		28,023		4,018		79,185		(5,058)		78,145
Provision for loan losses		—		7,511		—		7,511		—		17,138		—		17,138
Net interest income after provision for loan losses		1,589		20,613		(1,690)		20,512		4,018		62,047		(5,058)		61,007

Noninterest income:
Mortgage banking income		7,018		(215)		—		6,803		19,176		(397)		—		18,779
Other noninterest income		—		2,600		126		2,479		—		11,578		84		11,662
Total noninterest income		7,018		2,385		126		9,282		19,176		11,181		84		30,441

Noninterest expenses:
Salaries and benefits		5,444		8,983		2,337		16,764		14,716		27,706		6,165		48,587
Data processing expense		122		2,430		—		2,552		319		6,811		—		7,130
Other operating expenses		870		10,372		675		11,639		2,607		28,057		1,898		32,562
Total noninterest expenses		6,436		21,785		3,012		30,955		17,642		62,574		8,063		88,279
Income (loss) before income taxes		2,171		1,213		(4,576)		(1,161)		5,552		10,654		(13,037)		3,169
Income tax expense (benefit)		519		(404)		(419)		(304)		1,330		1,666		(1,317)		1,679
Net income (loss)		1,652		1,617		(4,157)		(857)		4,222		8,988		(11,720)		1,490
Net loss attributable to noncontrolling interests		—		—		2,085		2,085		—		—		5,640		5,640
Net income attributable to Primis' common stockholders	$	1,652	$	1,617	$	(2,072)	$	1,228	$	4,222	$	8,988	$	(6,080)	$	7,130

Total assets	$	110,902	$	3,906,456	$	6,989	$	4,024,347	$	110,902	$	3,906,456	$	6,989	$	4,024,347

(1)

Other includes Primis Bank Holding Company, PFH, and intercompany eliminations.

Table of Contents

ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management’s discussion and analysis (“MD&A”) is presented to aid the reader in understanding and evaluating the financial condition and results of operations of Primis. This discussion and analysis should be read in conjunction with the condensed consolidated financial statements, the footnotes thereto, and the other financial data included in this report and in our Annual Report on Form 10-K for the year ended December 31, 2024. Results of operations for the three and nine months ended September 30, 2025, are not necessarily indicative of results that may be achieved for any other period. The emphasis of this discussion will be on the three and nine months ended September 30, 2025, compared to the three and nine months ended September 30, 2024 for the consolidated income statements. For the consolidated balance sheets, the emphasis of this discussion will be the balances as of September 30, 2025 compared to December 31, 2024. This discussion and analysis contain statements that may be considered “forward-looking statements” as defined in, and subject to the protections of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. See the following section for additional information regarding forward-looking statements.

NON-GAAP

In the following discussion and analysis, we provide certain financial information determined by methods other than in accordance with GAAP. These non-GAAP financial measures are intended to supplement, not replace, GAAP, which we use to prepare our financial statements, and should not be considered in isolation or as a substitute for comparable measures calculated in accordance with GAAP. In addition, our non-GAAP financial measures may not be comparable to non-GAAP financial measures of other companies. We use the non-GAAP financial measures discussed herein in our analysis of our performance. Management believes that these non-GAAP financial measures provide additional understanding of our ongoing operations, enhance the comparability of our results of operations with prior periods and show the effects of significant gains and charges in the periods presented without the impact of items or events that may obscure trends in our underlying performance. Non-GAAP financial measures may be identified with the symbol ⁽⁺⁾ and may be labeled as adjusted. Refer to the “Non-GAAP Financial Measures” section within this Item 2 for more information about these non-GAAP financial measures, including a reconciliation of these measures to the most directly comparable GAAP financial measures.

FORWARD-LOOKING STATEMENTS

Statements and financial discussion and analysis contained in this Quarterly Report on Form 10-Q that are not statements of historical fact constitute forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not historical facts and are instead based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are inherently subject to risks, assumptions and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. The words “believe,” “may,” “forecast,” “should,” “anticipate,” “contemplate,” “estimate,” “expect,” “project,” “predict,” “intend,” “continue,” “would,” “could,” “hope,” “might,” “assume,” “objective,” “seek,” “plan,” “strive” or similar words, or the negatives of these words, identify forward-looking statements.

Forward-looking statements involve risks and uncertainties that may cause our actual results to differ materially from the expectations of future results we express or imply in any forward-looking statements. In addition to the Risk Factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024, and the other reports we file with the Securities and Exchange Commission, factors that could contribute to those differences include, but are not limited to:

●

the effects of future economic, business and market conditions and disruptions in the credit and financial markets, domestic and foreign;

Table of Contents

●

potential increases in the provision for credit losses and other general competitive, economic, political, and market factors, including those affecting our business, operations, pricing, products, or services;

●

uncertainties surrounding geopolitical events, trade policy, taxation policy, the impact of the federal government shutdown that began in October 2025 and monetary policy, which continue to impact the outlook for future economic growth (including an economic downturn or recession), including the U.S. imposition of tariffs on other countries and consideration of responsive actions by these nations or the expansion of import fees and tariffs among a larger group of nations, which is bringing greater ambiguity to the outlook for future economic growth;

●

fraudulent and negligent acts by loan applicants, mortgage brokers and our employees;

●

our ability to implement our various strategic and growth initiatives, including our Panacea Financial Division, digital banking platform, V1BE fulfillment service, Mortgage Warehouse lending, and Primis Mortgage Company, as well as our cost saving projects to reduce technology vendor expenses and administrative and branch expenses;

●

adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions;

●

changes in the local economies in our market areas which adversely affect our customers and their ability to transact profitable business with us, including the ability of our borrowers to repay their loans according to their terms or a change in the value of the related collateral;

●

changes in interest rates, inflation, stagflation, loan demand, real estate values, or competition, as well as labor shortages, supply chain disruptions, the threat of recession and volatile equity capital markets;

●

changes in the availability of funds resulting in increased costs or reduced liquidity, as well as the adequacy of our cash flow from operations and borrowings to meet our short-term liquidity needs;

●

a deterioration or downgrade in the credit quality and credit agency ratings of the investment securities in our investment securities portfolio;

●

impairment concerns and risks related to our investment securities portfolio of collateralized mortgage obligations, agency mortgage-backed securities and obligations of states and political subdivisions;

●

the incurrence and impairment of goodwill associated with current or future acquisitions and adverse short-term effects on our results of operations;

●

increased credit risk in our assets and increased operating risk caused by a material change in commercial, consumer and/or real estate loans as a percentage of our total loan portfolio, including as a result of rising or elevated interest rates, inflation and recessionary concerns;

●

the concentration of our loan portfolio in loans collateralized by real estate;

●

our level of construction and land development and commercial real estate loans;

●

risk related to a third-party’s ability to satisfy its contractual obligation to reimburse us for waived interest on loans with promotional features that pay off early;

●

our ability to identify and address potential cybersecurity risks on our systems and/or third party vendors and service providers on which we rely, heightened by the developments in generative artificial intelligence and increased use of our virtual private network platform, including data security breaches, credential stuffing, malware, “denial-of-service” attacks, “hacking” and identity theft, a failure of which could disrupt our business and result in the disclosure of and/or misuse or misappropriation of confidential or proprietary information, disruption or damage to our systems, increased costs, losses, or adverse effects to our reputation;

●

changes in the levels of loan prepayments and the resulting effects on the value of our loan portfolio;

●

the failure of assumptions and estimates underlying the establishment of and provisions made for credit losses;

●

our ability to expand and grow our business and operations, including the acquisition of additional banks, and our ability to realize the cost savings and revenue enhancements we expect from such activities;

●

government intervention in the U.S. financial system, including the effects of legislative, tax, accounting and regulatory actions and reforms, including the Dodd-Frank Act, the Jumpstart Our Business Startups Act, the Consumer Financial Protection Bureau, the capital ratios of Basel III as adopted by the federal banking authorities, the Tax Cuts and Jobs Act of 2017, the CARES Act and the One Big Beautiful Bill Act, as well as the possibility that the U.S. could default on its debt obligations and the risk of inflation and interest rate increases resulting from monetary and fiscal stimulus response, which may have unanticipated adverse effects on our customers, and our financial condition and results of operations;

●

the potential implementation of a regulatory reform agenda under the presidential administration that is significantly different than that of the prior administration, impacting rulemaking, supervision, examination and enforcement priorities of the federal banking agencies;

Table of Contents

●

increased competition for deposits and loans adversely affecting rates and terms;

●

the continued service of key management personnel;

●

the potential payment of interest on demand deposit accounts to effectively compete for customers;

●

the potential environmental liability risk associated with properties that we assume upon foreclosure;

●

increased asset levels and changes in the composition of assets and the resulting impact on our capital levels and regulatory capital ratios;

●

risks of current or future mergers and acquisitions, including the related time and cost of implementing transactions and the potential failure to achieve expected gains, revenue growth or expense savings;

●

increases in regulatory capital requirements for banking organizations generally, which may adversely affect our ability to expand our business or could cause us to shrink our business;

●

acts of God or of war or other conflicts, civil unrest, acts of terrorism, pandemics or other catastrophic events that may affect general economic conditions;

●

changes in accounting policies, rules and practices and applications or determinations made thereunder;

●

any inability or failure to implement and maintain effective internal control over financial reporting and/or disclosure control or inability to expediently remediate our existing material weaknesses in our internal controls deemed ineffective;

●

the risk that our deferred tax assets could be reduced if future taxable income is less than currently estimated, if corporate tax rates in the future are less than current rates, or if sales of our capital stock trigger limitations on the amount of net operating loss carryforwards that we may utilize for income tax purposes;

●

our ability to attract and retain qualified employees, including as a result of heightened labor shortages;

●

risks related to DEI and ESG strategies and initiatives, the scope and pace of which could alter our reputation and shareholder, associate, customer and third-party affiliations or result in litigation in connection with anti-DEI and anti-ESG laws, rules or activism;

●

negative publicity and the impact on our reputation;

●

our ability to realize the value of derivative assets that are recorded at fair value due to changes in fair value driven by actual results being materially different than our assumptions;

●

our ability to grow the mortgage warehouse business and achievement of certain margin results; and

●

other factors and risks described under “Risk Factors” herein and in any of the reports that we file with the SEC under the Exchange Act.

Forward-looking statements are not guarantees of performance or results and should not be relied upon as representing management’s views as of any subsequent date. A forward-looking statement may include a statement of the assumptions or bases underlying the forward-looking statement. We believe we have chosen these assumptions or bases in good faith and that they are reasonable. We caution you, however, that assumptions or bases almost always vary from actual results, and the differences between assumptions or bases and actual results can be material. When considering forward-looking statements, you should refer to the risk factors and other cautionary statements in this Quarterly Report on Form 10-Q and in our periodic and current reports filed with the SEC for specific factors that could cause our actual results to be different from those expressed or implied by our forward-looking statements. These statements speak only as of the date of this Quarterly Report on Form 10-Q (or an earlier date to the extent applicable). Except as required by applicable law, we undertake no obligation to publicly updated or revise these forward-looking statements in light of new information or future events.

Table of Contents

OVERVIEW

Primis Financial Corp. (NASDAQ: FRST) is the bank holding company for Primis Bank, a Virginia state-chartered bank, which commenced operations on April 14, 2005. Primis Bank provides a range of financial services to individuals and small and medium-sized businesses. As of September 30, 2025, Primis Bank had 24 full-service branches in Virginia and Maryland and also provides services to customers through certain online and mobile applications. Twenty-two full-service retail branches are in Virginia and two full-service retail branches are in Maryland. The Company is headquartered in McLean, Virginia and has an administrative office in Glen Allen, Virginia and an operations center in Atlee, Virginia. PMC, a residential mortgage lender headquartered in Wilmington, North Carolina, is a consolidated subsidiary of Primis Bank. PFH owns the rights to the Panacea Financial brand and its intellectual property and partners with the Bank to offer a suite of financial products and services for doctors, their practices, and ultimately the broader healthcare industry through the Panacea Financial Division of the Bank. PFH was a consolidated subsidiary of Primis until March 31, 2025, when it was deconsolidated in accordance with applicable accounting guidance.

While Primis Bank offers a wide range of commercial banking services, it focuses on making loans secured primarily by commercial real estate and other types of secured and unsecured commercial loans to small and medium-sized businesses in a number of industries, as well as loans to individuals for a variety of purposes. Primis Bank invests in real estate-related securities, including collateralized mortgage obligations and agency mortgage-backed securities. Primis Bank’s principal sources of funds for loans and investing in securities are deposits and, to a lesser extent, borrowings. Primis Bank offers a broad range of deposit products, including checking, savings, money market accounts and certificates of deposit. Primis Bank actively pursues business relationships by utilizing the business contacts of its senior management, other bank officers and its directors, thereby capitalizing on its knowledge of its local market areas.

Table of Contents

OPERATIONAL HIGHLIGHTS

Executive Overview

In 2024, we focused on organizing the core bank and lines of business that we believe drive premium operating results. The third quarter of 2025 demonstrated progress in key areas that are expected to continue and build through the rest of the year and into 2026. Our strategy centers on growing earning assets back to previous levels after the sale of our Life Premium Finance division and achieving higher production and profitability in our retail mortgage business. We continued to execute successfully during the first nine months of 2025 on these strategies, which included the following:

Core Community Bank

●

The core Bank’s loan portfolio was essentially flat at $2.1 billion at September 30, 2025, compared to $2.2 billion at December 31, 2024. The core Bank has low concentrations of investor commercial real estate loans.

●

The core Bank’s cost of deposits was 1.73% in the third quarter of 2025, compared to 2.29% in the third quarter of 2024. Approximately 20% of the core Bank’s deposit base at September 30, 2025, are noninterest bearing deposits.

●

The core Bank had zero brokered deposits and low utilization of FHLB borrowings at September 30, 2025.

Mortgage Warehouse

●

Outstanding loan balances as of September 30, 2025 were $327 million, up 411% from $64 million as of December 31, 2024.

●

Mortgage warehouse funded approximately 10% of its outstanding loans with associated customer noninterest bearing deposit balances, which totaled $34 million as of September 30, 2025.

●

Committed facilities were up 187% to $1 billion as of September 30, 2025, compared to $349 million as of December 31, 2024.

Panacea Financial Division

●

Outstanding loan balances grew 26% to $548 million during the nine months ended September 30, 2025 from $434 million as of December 31, 2024.

●

Outstanding deposits were $133 million as of September 30, 2025, up 44% from December 31, 2024.

Primis Mortgage

●

Funded loan volume was $308 million in the third quarter of 2025, up 34% from the third quarter of 2024.

●

Earnings for PMC was $2 million and $4 million for the three and nine months ended September 30, 2025, respectively. The nine month period was impacted by approximately $1 million of personnel costs related to new production teams hired at the end of the first quarter of 2025. However, as these teams rebuild their pipeline, we expect income from their production to exceed the upfront costs incurred.

Changes in the relationship between PFH and Primis during the first quarter of 2025 resulted in a determination to deconsolidate PFH from Primis as of March 31, 2025. The deconsolidation resulted in recognition of a $25 million gain for Primis during the nine months ended September 30, 2025, as a result of recording the fair value of our retained interest in common stock of PFH. The deconsolidation resulted in us no longer including PFH’s financial results in our financial results after March 31, 2025. PFH continues to work with the Panacea Division of the Bank to originate loans, some of which the Bank will retain, and others will be sold to investors and other financial institutions.

On June 12, 2025, we signed a non-binding term sheet to sell a portion of our retained ownership in PFH common shares after the deconsolidation and the sale of the shares generated proceeds of $22 million. Following the sale of these shares, we continued to hold approximately 467 thousand shares in PFH as of September 30, 2025. For the nine months ended September 30, 2025, we recorded a gain of $7 million in the income statement in “Gain on Panacea Financial Holdings investment” within noninterest income related to the sale of PFH common shares and fair value adjustments on our remaining investment.

Table of Contents

SUMMARY OF FINANCIAL RESULTS

Results of Operations Highlights

We experienced improved financial performance in both the three and nine months ended September 30, 2025 compared to the same periods in 2024. Net income available to common shareholders for the three months ended September 30, 2025 totaled $7 million, or $0.28 basic and diluted earnings per share, compared to net income of $1 million, or $0.05 basic and diluted earnings per share, for the three months ended September 30, 2024, resulting in an increase year-over-year of $6 million, or 600%. Net income available to common shareholders for the nine months ended September 30, 2025 totaled $32 million, or $1.29 basic and diluted earnings per share, compared to net income of $7 million, or $0.29 basic and diluted earnings per share, for the nine months ended September 30, 2024, resulting in an increase year-over-year of $25 million, or 357%. The key financial drivers of the improvement are noted in the following table with additional discussions following the table ($ in thousands).


	Three Months Ended		Nine Months Ended
	September 30, 2025		September 30, 2025
	compared to		compared to
	September 30, 2024		September 30, 2024
	Favorable (unfavorable) change
Net interest income	$	1,009	$	2,431
Provision for credit losses		7,560		7,288
Noninterest income		2,687		31,893
Noninterest expenses		(1,358)		(8,492)
Provision for income taxes		(2,211)		(6,309)
Noncontrolling interest		(2,085)		(2,038)
Net income attributable to Primis' common stockholders	$	5,602	$	24,773

●

Net interest income increases were driven by declines in interest expenses in 2025 compared to 2024. The interest expense declines were driven by lower average deposit and borrowing balances combined with lower interest rates. Net interest income for the third quarter of 2025 included $1 million of interest reversals on loans that were moved to nonaccrual in the quarter. During the nine months ended September 30, 2025 we also had significant interest income reversals on the Consumer Program loans due to higher credit losses, while there were no reversals during the same period in 2024.

●

Net interest margin increased to 3.18% for the three months ended September 30, 2025, compared to 2.97% for the three months ended September 30, 2024. Continued rebuilding of earning asset levels coupled with favorable deposit pricing was responsible for the improvement during the third quarter of 2025. Additionally, the effects of the Consumer Program loan portfolio were accretive in the third quarter due primarily to less credit losses resulting in less income reversals compared to prior periods.

●

Net interest margin grew to 3.06% for the nine months ended September 30, 2025, compared to 2.85% for the nine months ended September 30, 2024. The significant driver of this increase was a meaningful decrease in our cost of funds that declined by 63 basis points. Higher credit losses on the Consumer Program loans in the earlier part of 2025 negatively impacted margin resulting in interest income reversals.

●

The provision for loan losses decrease during the three months ended September 30, 2025 was driven by the changing mix of the Bank’s loan portfolio to loan categories with lower reserve requirements and the move of approximately $53 million of commercial loans to held for sale. Decreases were also driven during the nine month period by less reserves in the Consumer Program loan portfolio in 2025 due to higher reserves and charge-offs in 2024, higher expected credit quality of the remaining portfolio, and enhanced loss mitigation efforts in 2025, resulting in improved performance of the Consumer Program portfolio.

●

Noninterest income increased during the three month period of 2025 compared to 2024 primarily due to higher income from mortgage banking activity during the nine months ended September 30, 2025 compared to the same period in 2024, primarily driven by the $32 million gain on our PFH investment, which was comprised of a gain on deconsolidation of PFH in the first quarter of 2025 and gain on sale of a portion of our ownership in PFH and

Table of Contents

fair value adjustments to the remaining common share investment retained in the second and third quarter of 2025.

●

Noninterest expense increases were primarily driven in both periods by higher personnel costs due to growth in PMC, Mortgage Warehouse, and the Panacea Division of the Bank.

Balance Sheet Highlights

●

Total assets increased 7% as of September 30, 2025 when compared to December 31, 2024 primarily due to growth in PMC, Mortgage Warehouse, and the Panacea Division that drove growth in LHFI.

●

Total LHFI as of September 30, 2025 were $3.2 billion, an increase of $315 million, or 11%, from December 31, 2024. The increase was led by growth in the Mortgage Warehouse loans of $264 million and Panacea Division loans of $114 million since December 31, 2024.

●

Total deposits were $3.3 billion at September 30, 2025 compared to $3.2 million at December 31, 2024, with growth across all categories except for money market accounts and time deposits. Growth was partially driven by increased Mortgage Warehouse business and Panacea Division deposit account balances. Noninterest bearing demand deposits were $490 million at September 30, 2025, a growth rate of 12% compared to balances at December 31, 2024. We have no wholesale deposit funding at September 30, 2025.

●

The ratio of gross loans (excluding loans held for sale) to deposits increased to 95.9% at September 30, 2025, from 91.1% at December 31, 2024.

●

Allowance for credit losses to total loans was down 46 basis points to 1.40% as of September 30, 2025, compared to 1.86% as of December 31, 2024. The decline was driven by improved expected performance in the Consumer Program portfolio due to the significant decline in promotional loans that drove prior credit losses along with enhanced loss mitigation efforts during 2025, a changing mix of the Bank’s loan portfolio to loan categories with lower reserve requirements, and the $53 million of commercial loans moved to LHFS as of September 30, 2025 due to our intent to sell the loans.

●

Asset quality declined from year end with nonperforming assets as a percentage of total assets (excluding SBA guarantees) at 2.07% as of September 30, 2025, compared to 0.29% as of December 31, 2024, a 178 basis point change. This decline was primarily driven by one commercial real estate loan and one commercial relationship comprised of two loans that were placed on nonaccrual since year end. We have individual reserves on these loans of approximately 20% and are actively working with the borrowers to facilitate a return to performing status.

●

Book value and tangible book value⁽⁺⁾ per common share increased by 128 and 129 basis points, respectively, as of September 30, 2025 compared to December 31, 2024, driven by the increase in equity as a result of net income.

●

Our capital ratios continued to exceed requirements to be considered well capitalized as of September 30, 2025, with decreases in Common Equity Tier 1 and Tier 1 and total risk-based capital of 12, 14 and 51 basis points, respectively, compared to December 31, 2024.

Table of Contents

RESULTS OF OPERATIONS

Net Income

Three-Month Comparison Net income available to common shareholders for the three months ended September 30, 2025 totaled $7 million, or $0.28 basic and diluted earnings per share, compared to $1 million, or $0.05 basic and diluted earnings per share, for the three months ended September 30, 2024. The results reflect a decrease in provision for credit losses of $7 million driven by less provision required on the Consumer Program portfolio, the changing mix of the Bank’s loan portfolio to loan categories with lower reserve requirements and the move of approximately $53 million of commercial loans to held for sale. The results also reflect an increase in noninterest income of $3 million primarily due to higher mortgage banking income in the third quarter driven by growth of PMC and higher loan sales and related gains and a $1 million increase in net interest income driven by lower interest expenses on deposits and borrowings. These are partially offset by an increase in noninterest expense of $1 million driven by personnel expenses due to growth in PMC and Mortgage Warehouse, a $2 million increase in our income tax provision and a decrease in noncontrolling interest income of $2 million. Additional details of the changes in net income will be discussed in the remaining sections of this Results of Operations section.

Nine-Month Comparison Net income available to common shareholders for the nine months ended September 30, 2025 totaled $32 million, or $1.29 basic and diluted earnings per share, compared to $7 million, or $0.29 basic and diluted earnings per share, for the nine months ended September 30, 2024. The results reflect an increase in noninterest income of $32 million, primarily due to a gain on the deconsolidation of PFH in the first quarter of 2025 and gains from the sale of a portion of our remaining investment in PFH common share investment in 2025. A $2 million increase in our net interest income was driven by lower interest expenses in the current year on both deposits and borrowings due to lower average balances and lower interest rates. These increases were partially offset by an increase in noninterest expense of $8 million driven primarily by higher personnel costs due to growth in PMC, Mortgage Warehouse, and the Panacea Division of the Bank and an increase in income tax provisions of $6 million from higher pre-tax earnings. Additional details of the changes in net income will be discussed in the remaining sections of this Results of Operations section.

Table of Contents

Net Interest Income and Net Interest Margin

Our operating results depend primarily on our net interest income, which is the difference between interest and dividend income on interest-earning assets such as loans and investments, and interest expense on interest-bearing liabilities such as deposits and borrowings.

Three-Month Comparison

The following table details average balances of interest-earning assets and interest-bearing liabilities, the amount of interest earned/paid on such assets and liabilities, and the yield/rate for the periods indicated:


	Average Balance Sheets and Net Interest Margin
	Analysis For the Three Months Ended
	September 30, 2025						September 30, 2024
			Interest						Interest
	Average		Income/		Yield/		Average		Income/		Yield/
	Balance		Expense		Rate		Balance		Expense		Rate

	(Dollar amounts in thousands)
Assets
Interest-earning assets:
Loans held for sale	$	130,061	$	2,085	6.36	%	$	98,110	$	1,589	6.44	%
Loans, net of deferred fees ^{(1) (2)}		3,143,155		46,772	5.90	%		3,324,157		52,707	6.31	%
Investment securities		247,008		1,894	3.04	%		242,631		1,799	2.95	%
Other earning assets		101,278		1,015	3.98	%		83,405		1,017	4.85	%
Total earning assets		3,621,502		51,766	5.67	%		3,748,303		57,112	6.06	%
Allowance for credit losses		(44,520)						(49,966)
Total non-earning assets		277,156						293,681
Total assets	$	3,854,138					$	3,992,018

Liabilities and stockholders' equity
Interest-bearing liabilities:
NOW and other demand accounts	$	834,839	$	4,549	2.16	%	$	748,202	$	4,630	2.46	%
Money market accounts		756,361		5,229	2.74	%		859,988		7,432	3.44	%
Savings accounts		922,048		8,070	3.47	%		866,375		8,918	4.10	%
Time deposits		324,614		2,723	3.33	%		425,238		4,371	4.09	%
Total interest-bearing deposits		2,837,862		20,571	2.88	%		2,899,803		25,351	3.48	%
Borrowings		117,697		2,163	7.29	%		238,994		3,738	6.22	%
Total interest-bearing liabilities		2,955,559		22,734	3.05	%		3,138,797		29,089	3.69	%
Noninterest-bearing liabilities:
Demand deposits		481,697						421,908
Other liabilities		36,720						36,527
Total liabilities		3,473,976						3,597,232
Primis common stockholders' equity		380,162						377,314
Noncontrolling interest		—						17,472
Total stockholders' equity		380,162						394,786
Total liabilities and stockholders' equity	$	3,854,138	$	29,032			$	3,992,018	$	28,023
Interest rate spread					2.62	%					2.37	%
Net interest margin					3.18	%					2.97	%

(1)	Includes loan fees in both interest income and the calculation of the yield on loans.

(2)	Calculations include non-accruing loans in average loan amounts outstanding.

Table of Contents

Net interest income was $29 million for the three months ended September 30, 2025, compared to $28 million for the three months ended September 30, 2024. Net interest income increased as a result of interest-bearing liability costs declining more than the declines in interest-earning asset income. Net interest income for the third quarter of 2025 included $1 million of interest reversals on loans that were moved to nonaccrual in the quarter. Our net interest margin for the three months ended September 30, 2025 was 3.18%, compared to 2.97% for the three months ended September 30, 2024. Continued rebuilding of earning asset levels coupled with favorable deposit pricing was responsible for the improvement during the third quarter of 2025. Margin increased by 21 basis points primarily as a result of lower average interest-earning asset balances and slightly higher net interest income when comparing the three months ended September 30, 2025 to the three months ended September 30, 2024.

●

Average earning assets decreased $127 million, or 3%, primarily due to a decline in average total loans of $149 million, or 4%, partially offset by growth in other earning assets of $18 million, or 21%, and an increase in average investment securities of $4 million, or 2%. Average earning asset balances were driven lower by a $181 million decline in average loan balances which was primarily a result of the sale of approximately $400 million of our life premium finance loan portfolio in the fourth quarter of 2024 and the decision to run-off the remaining retained life premium finance loans and a decline in average Consumer Program loans of $89 million, partially offset by an increase in average Mortgage Warehouse loans of $208 million and average Panacea loans of $99 million.

●

Average interest-bearing liabilities declined by $183 million largely due to maturing time deposits driving average time deposit balances down by $101 million. We also experienced declines in average money market deposit accounts of $104 million, partially offset by growth in demand deposits of $87 million and savings balances of $56 million. The increase in demand deposits was driven by growth in the Panacea Division and Mortgage Warehouse business, each of which has been successful in growing deposits alongside their loan growth. Rates on average interest-bearing deposits declined 60 basis points in total, in large part due to a decline in the Fed Funds borrowing rate during the last twelve months of 75 basis points, which influences our deposit pricing. Interest paid on average borrowings decreased $2 million due to a decline of $121 million in average borrowings from the prior year.

●

Yields on average interest earning assets decreased by 39 basis points comparing the three months ended September 30, 2025 to 2024. The decline was primarily driven by decreases in yields earned on loans which were down 8 basis points on LHFS and 41 basis points on LHFI. The decline in HFI was primarily driven by the sale of our life premium finance loans and charge-offs in the Consumer Program loan portfolio, both of which earned higher rates, and due to the drop in benchmark lending rates since the three months ended September 30, 2024. Yields on all of our interest-bearing liabilities declined by 64 basis points during the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily driven by the decline in benchmark borrowing rates by 75 basis points over that time.

Our net interest income and margin were positively impacted during the three months ended September 30, 2025 compared to the same period in 2024 by the Consumer Program loans. During the third quarter, we had lower charge-offs related to these loans, most of which had promotional interest features, which resulted in less reversal of interest income. The Company recognizes interest income on the promotional loans when promotional features expire and which generally includes a substantial amount of deferred interest accumulated to that date. If the loan subsequently defaults, that previously recognized interest is reversed against interest income. The Bank recognized substantial interest income on loans exiting their promotional periods beginning in the third quarter of 2024, with a roughly one quarter lag of subsequent reversals primarily due to high first payment defaults on full deferral promotional loans. The interest recognized on promotional loan expirations was insignificant in the third quarter of 2025, which is expected to lead to substantially lower interest income reversals going forward.

Table of Contents

Nine-Month Comparison


	Average Balance Sheets and Net Interest Margin
	Analysis For the Nine Months Ended
	September 30, 2025						September 30, 2024
			Interest						Interest
	Average		Income/		Yield/		Average		Income/		Yield/
	Balance		Expense		Rate		Balance		Expense		Rate

	(Dollar amounts in thousands)
Assets
Interest-earning assets:
Loans held for sale	$	136,273	$	4,895	4.80	%	$	80,530	$	4,017	6.66	%
Loans, net of deferred fees ^{(1) (2)}		3,039,443		133,643	5.88	%		3,266,111		147,564	6.04	%
Investment securities		247,243		5,728	3.10	%		242,706		5,319	2.93	%
Other earning assets		95,430		2,850	3.99	%		78,076		2,756	4.72	%
Total earning assets		3,518,389		147,116	5.59	%		3,667,423		159,656	5.82	%
Allowance for credit losses		(43,840)						(50,929)
Total non-earning assets		289,626						295,815
Total assets	$	3,764,175					$	3,912,309

Liabilities and stockholders' equity
Interest-bearing liabilities:
NOW and other demand accounts	$	820,859	$	13,667	2.23	%	$	766,800	$	13,924	2.43	%
Money market accounts		767,729		15,920	2.77	%		832,531		20,732	3.33	%
Savings accounts		853,474		22,281	3.49	%		844,531		25,876	4.09	%
Time deposits		329,832		8,592	3.48	%		426,557		12,455	3.90	%
Total interest-bearing deposits		2,771,894		60,460	2.92	%		2,870,419		72,987	3.40	%
Borrowings		117,454		6,080	6.92	%		172,942		8,524	6.58	%
Total interest-bearing liabilities		2,889,348		66,540	3.08	%		3,043,361		81,511	3.58	%
Noninterest-bearing liabilities:
Demand deposits		465,327						440,172
Other liabilities		37,211						35,344
Total liabilities		3,391,886						3,518,877
Primis common stockholders' equity		368,295						374,154
Noncontrolling interest		3,994						19,278
Total stockholders' equity		372,289						393,432
Total liabilities and stockholders' equity	$	3,764,175					$	3,912,309
Net interest income			$	80,576					$	78,145
Interest rate spread					2.51	%					2.24	%
Net interest margin					3.06	%					2.85	%

(1)	Includes loan fees in both interest income and the calculation of the yield on loans.

(2)	Calculations include non-accruing loans in average loan amounts outstanding.

Table of Contents

Net interest income was $80 million for the nine months ended September 30, 2025, compared to $78 million for the nine months ended September 30, 2024. Net interest income increased as a result of interest-bearing liability costs declining more than the declines in interest-earning asset income. Our net interest margin for the nine months ended September 30, 2024 was 3.06%, compared to 2.85% for the nine months ended September 30, 2024. Margin increased by 21 basis points primarily from higher net interest income on lower average interest-earning assets over those periods. Consumer Program loan income reversals had a significant impact on the nine months ended September 30, 2025 and no impact on the same period in 2024.

●

Average earning assets decreased $149 million, or 4%, primarily due to a decline in average total loans of $171 million, or 5%, partially offset by growth in other earning assets of $17 million, or 22%, and a $5 million, or 2%, increase in average investment securities. Decline in average loan balances was driven primarily by the sale of approximately $400 million of our life premium finance loan portfolio in the fourth quarter of 2024 and the decision to run-off the remaining retained life premium finance loans and the decline in average balances of Consumer Program loans of $107 million. These average loan balance declines were partially offset by continued growth of average Panacea Division loans of $131 million and Mortgage Warehouse loan of $114 million during the nine months ended September 30, 2025 compared to the same period in 2024.

●

Average interest-bearing liabilities declined by $154 million largely due to maturing time deposits driving average time deposit balances down by $97 million. We also experienced declines in average money market accounts of $64 million, partially offset by growth in demand deposits of $54 million and savings balances of $9 million. The increase in demand deposits was driven by growth in the Panacea Division and Mortgage Warehouse business, each of which has been successful in growing deposits alongside their loan growth. Rates on average interest-bearing deposits declined 48 basis points, in large part due to a decline in the Fed Funds borrowing rate during the last twelve months of 75 basis points, which influences our deposit pricing. Interest paid on average borrowings decreased $2 million due to a decline of $55 million in average borrowings from the prior year.

●

Yields on average interest earning assets decreased 23 basis points driven by lower yields on LHFS and LHFI during the nine months ended September 30, 2025 compared to the same period in 2024. The sale of our life premium finance loans, which earned higher yields than our average loan portfolio yield, and the significant reversals of Consumer Program loan income due to charge-offs of promotional loans during the nine months ended September 30, 2025 drove the overall earning asset yield decline. The drop in benchmark lending rates since the nine months ended September 30, 2024 also impacted the decline as newer production was generally at lower rates in 2025 compared to 2024. Yields on all of our interest bearing liabilities declined by 50 basis points during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily driven by the decline in benchmark borrowing rates by 75 basis points over that time.

Table of Contents

Provision for (Recovery of) Credit Losses

The provision for (recovery of) credit losses is a current charge to earnings made in order to adjust the allowance for credit losses for current expected losses in the loan portfolio based on an evaluation of the loan portfolio characteristics, current economic conditions, changes in the nature and volume of lending, historical loan experience and other known internal and external factors affecting loan collectability, and assessment of reasonable and supportable forecasts of future economic conditions that would impact collectability of the loans. Our allowance for credit losses is calculated by segmenting the loan portfolio by loan type and applying risk factors to each segment. The risk factors are determined by considering historical loss data, peer data, as well as applying management’s judgment.

For the three months ended September 30, 2025 and 2024, we had a recovery of credit losses of $49 thousand and provision for credit losses of $7 million, respectively. The recovery of credit losses during the three months ended September 30, 2025 was driven by the changing mix of the Bank’s loan portfolio to loan categories with lower reserve requirements and the move of approximately $53 million of commercial loans to held for sale and reversal of the allowance on these loans. Based on performance during the quarter, there was provision expense of $274 thousand associated with the Consumer Program in the third quarter of 2025 compared to $4 million during the three months ended September 30, 2024.

For the nine months ended September 30, 2025 and 2024, we had a provision for credit losses of $10 million and $17 million, respectively. Decline in provision for credit losses for the nine months ended September 30, 2025 compared to September 30, 2024 was driven by higher provisions in the 2024 periods primarily related to the Consumer Program loans. Credit losses were concentrated in the promotional portion of that portfolio that were largely originated between the third quarter of 2022 and first quarter of 2023. Due to the majority of these promotional loans ending their promotions in 2024 or the first quarter of 2025, coupled with our loss mitigation efforts in 2025, our provisioning for this portfolio was only $2 million during the nine months ended September 30, 2025, compared to $13 million during the nine months ended September 30, 2024.

The decline in provision during the nine months ended September 30, 2025 compared to the same period of 2024 was also driven by the lower provisioning for Consumer Program loans, the change in portfolio mix, and transfer to held for sale of commercial loans in the three months ended September 30, 2025. Partially offsetting the decline in provision during the nine months ended September 30, 2025 was $7 million of provisions on an individually evaluated commercial real estate loan that was placed on nonaccrual during the period, due to certain weaknesses in the credit. See additional discussion of this loan in the Asset Quality section of this MD&A.

The Financial Condition section of this MD&A provides information on our loan portfolio, past due loans, nonperforming assets and the allowance for credit losses.

Table of Contents

Noninterest Income

Three-Month Comparison


	For the Three Months Ended
	September 30,
(dollars in thousands)	2025		2024		Change
Account maintenance and deposit service fees	$	1,358	$	1,468	$	(110)
Income from bank-owned life insurance		456		431		25
Gain on Panacea Financial Holdings investment		294		—		294
Mortgage banking income		8,887		6,803		2,084
Gains on sale of loans		249		—		249
Gains on other investments		381		51		330
Consumer Program derivative income		264		79		185
Other noninterest income		80		450		(370)
Total noninterest income	$	11,969	$	9,282	$	2,687

Noninterest income increased 29% to $12 million for the three months ended September 30, 2025, compared to $9 million for the three months ended September 30, 2024. The increase was primarily driven by $2 million of higher income from mortgage banking activity during the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The 31% increase in mortgage banking income was due to higher gain on sale income driven by an increase of $62 million, or 27%, in loan sales during the three months ended September 30, 2025 compared to 2024 as well as higher fair value gains in marking the mortgage HFS loan portfolio to fair value. The increase in noninterest income was also a result of $330 thousand of gains from returns on other investments and a $294 thousand gain due to fair value adjustments to the remaining common share investment retained in PFH.

Consumer Program related income was $264 thousand for the three months ended September 30, 2025, compared to $79 thousand for the three months ended September 30, 2024. While we recognized less income in the third quarter of 2025 from borrowers paying off their promotional loans before the end of the promotional period triggering payment of interest from the third-party, there were less negative fair value adjustments on the related derivative in the third quarter of 2025 compared to the same quarter in 2024. Noninterest income from the Consumer Program is expected to be increasingly immaterial going forward as promotional loans have declined to $7 million at the end of the third quarter of 2025 and the derivative value is immaterial at September 30, 2025.

Table of Contents

Nine-Month Comparison


	For the Nine Months Ended
	September 30,
(dollars in thousands)	2025		2024		Change
Account maintenance and deposit service fees	$	4,372	$	4,722	$	(350)
Income from bank-owned life insurance		1,319		1,975		(656)
Gains on Panacea Financial Holdings investment		32,322		—		32,322
Mortgage banking income		22,395		18,779		3,616
Gains on sale of loans		459		307		152
Gains on other investments		126		393		(267)
Consumer Program derivative income		565		3,392		(2,827)
Other noninterest income		776		873		(97)
Total noninterest income	$	62,334	$	30,441	$	31,893

Noninterest income increased 105% to $62 million for the nine months ended September 30, 2025, compared to $30 million for the nine months ended September 30, 2024. The increase in noninterest income was primarily driven by the $32 million gain on our PFH investment, which comprised the gain on deconsolidation of PFH in the first quarter of 2025 and gain on the sale of a portion of our ownership in PFH and fair value adjustments to the remaining common share investment retained in the second and third quarter of 2025. The increase was also driven partially by $4 million of higher income from mortgage banking activity during 2025 compared to 2024. The increase in mortgage banking income was due to higher gain on sale income driven by $194 million, or 36%, higher loan sales during the nine months ended September 30, 2025 compared to 2024. The increases were partially offset by declines in Consumer Program derivative income and income from bank-owned life insurance held as a result of several one-time death benefit gains in 2024 that did not re-occur in 2025

The decline in Consumer Program related income included higher derivative fair value losses during the nine months ended September 30, 2025 compared to 2024 because the promotional loan population declined at a faster pace during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The fair value losses on the derivative were $443 thousand higher during the nine months ended September 30, 2025 compared to the same period in 2024. The remaining decline in the Consumer Program derivative income was a combination of less income earned from the third-party on origination of loans, which ended in January of 2025, and less reimbursement due to us when borrowers paid off their promotional loans before the end of the promotional period. These two items resulted in a combined decline of $2 million in income when comparing the nine months ended September 30, 2025 to the same period in 2024. Noninterest income from the Consumer Program is expected to be increasingly immaterial going forward as promotional loans have declined to only $7 million at the end of the third quarter of 2025 and the derivative value is immaterial at September 30, 2025.

Table of Contents

Noninterest Expense

Three-Month Comparison


	For the Three Months Ended
	September 30,
(dollars in thousands)	2025		2024		Change
Salaries and benefits	$	18,523	$	16,764	$	1,759
Occupancy expenses		1,575		1,248		327
Furniture and equipment expenses		1,906		1,823		83
Amortization of core deposit intangible		—		318		(318)
Virginia franchise tax expense		576		631		(55)
FDIC insurance assessment		999		545		454
Data processing expense		2,369		2,552		(183)
Marketing expense		450		449		1
Telephone and communication expense		309		330		(21)
Professional fees		2,509		2,914		(405)
Miscellaneous lending expenses		231		1,098		(867)
Other operating expenses		2,866		2,283		583
Total noninterest expenses	$	32,313	$	30,955	$	1,358

Noninterest expenses increased 4% to $32 million during the three months ended September 30, 2025, compared to $31 million during the three months ended September 30, 2024. The increase was primarily driven by higher salaries and benefits expenses, FDIC insurance expense, and occupancy expenses, partially offset by lower miscellaneous lending expenses, professional fees, and amortization of core deposit intangibles. Our core deposit intangible fully amortized in the second quarter of 2025.

Salaries and benefits expenses increased $2 million in the three months ended September 30, 2025, compared to the same period in 2024. PMC accounted for the growth in salaries and benefits while the remainder of the bank managed to reflect a small decline in total compensation costs. For the third quarter of 2025, PMC had $7 million in total salaries and benefits, an increase of $2 million or 35% compared to the same period in 2024. All other compensation costs were $11 million in the third quarter of 2025, down slightly from the $12 million reported in the third quarter of 2024.

FDIC insurance expense increased $454 thousand during the three months ended September 30, 2025, compared to the same period in 2024 primarily due to an increase in our assessment base as a result of the financial restatements in 2024 along with changes in asset quality in 2025. Occupancy expenses increased $327 thousand in the three months ended September 30, 2025, compared to the three months ended September 30, 2024, due to one-time expenses incurred in the third quarter of 2025 that did not occur in the third quarter of 2024.

Miscellaneous lending expenses decreased $867 thousand in the third quarter of 2025 compared to the third quarter of 2024 due to lower servicing fees paid to the third-party servicer of our Consumer Program loan portfolio which has reduced in size by 48% since January 1, 2024, less repurchase reserve provisions on PMC sold loans, and less provisions on unfunded Bank issued loan commitments during the current year quarter compared to the prior year quarter.

Professional fees decreased $405 thousand in the third quarter of 2025 compared to the third quarter of 2024. The primary driver of the decline was due to expenses during the three months ended September 30, 2024 related to the restatement of financial statements in 2024 that did not reoccur in the third quarter of 2025. Professional fees in the third quarter of 2025 included $1 million in legal fees associated with mortgage recruiting that management expects will subside in the coming quarters.

Table of Contents

Nine-Month Comparison


	For the Nine Months Ended
	September 30,
(dollars in thousands)	2025		2024		Change
Salaries and benefits	$	53,524	$	48,587	$	4,937
Occupancy expenses		4,321		3,988		333
Furniture and equipment expenses		5,572		5,288		284
Amortization of core deposit intangible		602		952		(350)
Virginia franchise tax expense		1,730		1,894		(164)
FDIC insurance assessment		2,813		1,744		1,069
Data processing expense		8,255		7,130		1,125
Marketing expense		1,684		1,407		277
Telephone and communication expense		920		1,017		(97)
Professional fees		7,147		7,255		(108)
Miscellaneous lending expenses		1,965		1,835		130
Other operating expenses		8,238		7,182		1,056
Total noninterest expenses	$	96,771	$	88,279	$	8,492

Noninterest expenses increased 10% to $96 million during the nine months ended September 30, 2025, compared to $88 million during the nine months ended September 30, 2024. The increase was primarily driven by higher salaries and benefits expenses, data processing expense, and FDIC insurance expenses in 2025 compared to 2024. These increases were partially offset by less core deposit intangible amortization that fully amortized by June 30, 2025.

The higher salaries and benefits expense of $5 million for the nine months ended September 30, 2025 compared to the same period in 2024 was driven primarily due to additions of several lending teams at PMC, one of which is the top mortgage originator in the Nashville, TN market and the other is the fourth ranked VA lender in the country. These teams drove the salaries and benefits expense in 2025 due to salary draws while they rebuilt their portfolios. These teams are expected to generate production in 2025 that will exceed these initial salary draws, which should help to generate income that offsets the salary expenses in later periods. Increase in salaries and benefits was also from the growth in salaries and benefit expenses in the Panacea and Mortgage Warehouse lines of business, each increasing $1 million when comparing the year-to-date periods in 2025 to 2024.

FDIC insurance expense increased $1 million during the nine months ended September 30, 2025 compared to the same period in 2024 primarily due to an increase in our assessment base as a result of the financial restatements in 2024 and the changes in asset quality in 2025.

Data processing expense increased $1 million comparing the nine months ended September 30, 2025 to 2024, which was due to higher processing volume and was also a result of our continued use of two core operating systems. We have negotiated a new contract with our core data provider with contract terms that began to provide significant reductions in data processing expense in August of 2025.

Table of Contents

FINANCIAL CONDITION

The following illustrates key balance sheet categories as of September 30, 2025 and December 31, 2024 ($ in thousands):


	September 30,		December 31,
	2025		2024		Change
Total cash and cash equivalents	$	63,881	$	64,505	$	(624)
Securities available-for-sale		234,660		235,903		(1,243)
Securities held-to-maturity		8,550		9,448		(898)
Loans held for sale, at fair value		148,781		83,276		65,505
Loans held for sale, at lower of cost or market		53,591		163,832		(110,241)
Net loans		3,155,468		2,833,723		321,745
Other assets		289,918		299,428		(9,510)
Total assets	$	3,954,849	$	3,690,115	$	264,734

Total deposits	$	3,336,352	$	3,171,035	$	165,317
Borrowings		200,448		116,991		83,457
Other liabilities		35,896		37,107		(1,211)
Total liabilities		3,572,696		3,325,133		247,563
Total equity		382,153		364,982		17,171
Total liabilities and equity	$	3,954,849	$	3,690,115	$	264,734

LOAN PORTFOLIO

Loans Held for Sale

LHFS declined $45 million from December 31, 2024 primarily due to the sale of $51 million of LPF loans, paydowns of Consumer Program LHFS, and the transfer back to net loans of $102 million of Consumer Program loans in 2025 after the decision to retain these for the foreseeable future or until maturity. These declines were partially offset by increased originations of PMC loans held for sale at fair value and the transfer to held for sale, at the lower of cost or market, of commercial loans in the Panacea Division that we intend to sell in the fourth quarter to another financial institution.

Loans Held for Investment

Gross LHFI were $3.2 billion and $2.9 billion as of September 30, 2025 and December 31, 2024, respectively. The increase in loans was driven by the transfer back from LHFS into the consumer loans category in LHFI of Consumer Program loans along with growth of mortgage warehouse loans and Panacea Division commercial loans, both of which were the primary driver of the $307 million increase in commercial loans seen below. The growth was partially offset by loan paydowns during the nine months ended September 30, 2025 of loans secured by real estate. As of September 30, 2025 and December 31, 2024, a majority of our loans were to customers located in Virginia and Maryland. We are not dependent on any single customer or group of customers whose insolvency would have a material adverse effect on our operations.

Table of Contents

The composition of our loans HFI portfolio consisted of the following as of September 30, 2025 and December 31, 2024 ($ in thousands):


	September 30, 2025				December 31, 2024
	Amount		Percent		Amount		Percent
Loans secured by real estate:
Commercial real estate - owner occupied	$	495,739	15.5	%	$	475,898	16.5	%
Commercial real estate - non-owner occupied		592,480	18.5	%		610,482	21.1	%
Secured by farmland		3,642	0.1	%		3,711	0.1	%
Construction and land development		102,227	3.2	%		101,243	3.5	%
Residential 1-4 family		564,087	17.6	%		588,859	20.4	%
Multi- family residential		137,804	4.3	%		158,426	5.4	%
Home equity lines of credit		62,458	2.0	%		62,954	2.2	%
Total real estate loans		1,958,437	61.2	%		2,001,573	69.2	%

Commercial loans		915,158	28.6	%		608,595	21.1	%
Paycheck protection program loans		1,723	0.1	%		1,927	0.1	%
Consumer loans		319,977	10.0	%		270,063	9.4	%
Total Non-PCD loans		3,195,295	99.9	%		2,882,158	99.8	%
PCD loans		4,939	0.1	%		5,289	0.2	%
Total loans	$	3,200,234	100.0	%	$	2,887,447	100.0	%

The following table sets forth the contractual maturity ranges of our LHFI portfolio and the amount of those loans with fixed and floating interest rates in each maturity range as of September 30, 2025 ($ in thousands):


			After 1 Year				After 5 Years
			Through 5 Years				Through 15 Years				After 15 Years
	One Year		Fixed		Floating		Fixed		Floating		Fixed		Floating
	or Less		Rate		Rate		Rate		Rate		Rate		Rate		Total
Loans secured by real estate:
Commercial real estate - owner occupied	$	21,517	$	70,735	$	31,288	$	189,916	$	134,279	$	1,644	$	46,360	$	495,739
Commercial real estate - non-owner occupied		93,486		159,761		30,623		88,789		86,875		9,283		123,663		592,480
Secured by farmland		1,007		649		77		226		591		—		1,092		3,642
Construction and land development		68,945		1,357		27,296		—		4,587		—		42		102,227
Residential 1-4 family		15,786		46,420		13,168		22,262		41,976		63,835		360,640		564,087
Multi- family residential		49,591		31,413		29,001		—		5,826		—		21,973		137,804
Home equity lines of credit		3,255		757		7,026		29		706		24		50,661		62,458
Total real estate loans		253,587		311,092		138,479		301,222		274,840		74,786		604,431		1,958,437
Commercial loans		122,610		85,098		359,098		298,242		47,778		1,031		1,301		915,158
Paycheck protection program loans		1,723		-		—		—		—		—		—		1,723
Consumer loans		6,156		189,448		54,744		61,074		6,835		1,715		5		319,977
Total Non-PCD loans		384,076		585,638		552,321		660,538		329,453		77,532		605,737		3,195,295
PCD loans		2,373		1,125		92		—		975		374		—		4,939
Total loans	$	386,449	$	586,763	$	552,413	$	660,538	$	330,428	$	77,906	$	605,737	$	3,200,234

Our highest concentration of credit by loan type is in commercial real estate. As of September 30, 2025, 38% of our loan portfolio was comprised of loans secured by commercial real estate, including multi-family residential loans and loans secured by farmland. Commercial real estate loans are generally viewed as having a higher risk of default than residential real estate loans and depend on cash flows from the owner’s business or the property’s tenants to service the debt. The borrower’s cash flows may be affected significantly by general economic conditions, a downturn in the local economy, or in occupancy rates in the market where the property is located, any of which could increase the likelihood of default.

Table of Contents

We seek to mitigate risks attributable to our most highly concentrated portfolios and our portfolios that pose unique risks to our balance sheet through our credit underwriting and monitoring processes, including oversight by a centralized credit administration function, approval process, credit policy, and risk management committee, as well as through our seasoned bankers that focus on lending to borrowers with proven track records in markets with which we are familiar.

The following table presents the composition of the industry classification for commercial real estate non-owner occupied loans as a percentage of total loans for the periods ended September 30, 2025 and December 31, 2024 (dollars in thousands):


	September 30, 2025				December 31, 2024
	Amount		Percent		Amount		Percent
Commercial real estate - non-owner occupied
Hotel/ Motel	$	167,502	28.3	%	$	190,077	31.1	%
Office		136,366	23.0	%		136,046	22.3	%
Retail		91,372	15.4	%		97,748	16.0	%
Assisted living		56,353	9.5	%		58,191	9.5	%
Mixed use		44,777	7.6	%		49,419	8.1	%
Warehouse/ Industrial		21,236	3.6	%		21,454	3.5	%
Daycare/Schools/Churches		10,839	1.8	%		8,851	1.4	%
Self-storage		10,881	1.8	%		5,833	1.0	%
Leisure/Recreational		14,870	2.5	%		4,598	0.8	%
Other		38,284	6.5	%		38,265	6.3	%
Total Commercial real estate - non-owner occupied	$	592,480	100.0	%	$	610,482	100.0	%

The following table presents the composition of office portfolio loans for commercial real estate non-owner occupied loans, their loan count and their weighted average loan-to-value percentage as of September 30, 2025 and December 31, 2024 (dollars in thousands):


	September 30, 2025					December 31, 2024
Commercial real estate - non-owner occupied - Office Portfolio ⁽¹⁾	Loan count		Amount	Weighted Average Loan-to-Value		Loan count		Amount	Weighted Average Loan-to-Value
Commercial medical office	10	$	9,375	67.1	%	5	$	7,020	66.9	%
Commercial office building	28		109,150	66.0	%	31		110,675	66.3	%
Commercial office/ warehouse	12		17,841	36.9	%	12		18,351	37.8	%
Total	50	$	136,366	62.2	%	48	$	136,046	62.5	%

⁽¹⁾ The office portfolio is a subset of our Commercial real estate non-owner occupied loans.

The shift to work-from-home and hybrid work environments has caused a decreased utilization of office space. As such, we have additional monitoring for our exposure to office space, within our non-owner occupied commercial real estate portfolio, including periodic credit risk assessment of expiring office leases for most of the office portfolio. We do not currently finance large, high-rise, or major metropolitan central business district office buildings, and the office portfolio is generally in suburban markets with strong occupancy levels.

Table of Contents

Consumer Program Loans

The following table sets forth the contractual maturity ranges of our Consumer Program loan portfolio as of September 30, 2025, which is only originated at fixed rates ($ in thousands):


	One Year or Less		After One Year to Five Years		After Five Through Ten Years		After Ten Years		Total
Total Consumer Program Loans ⁽¹⁾	$	392	$	33,394	$	53,177	$	22,944	$	109,907

⁽¹⁾ Does not include $9 million of remaining fair market value adjustments related to the original $20 million write-down of the portfolio when transferred to LHFS as of December 31, 2024.

The following table describes the period over which our Consumer Program loans that are currently in a no interest promotional period will exit that promotional period and begin to amortize. All these promotional loans generally amortize over four years from the date they exit the promotional period if not prepaid before the end of the promotional period ($ in thousands):


	Amount ending		Amount ending
	No Interest		No Interest		Total Interest
	Promotional Period in		Promotional Period in		Promotional
	next 12 months		next 13-24 months		as of 9/30/25
Consumer Program Loans	$	6,984	$	286	$	7,270

During the three and nine months ended September 30, 2025, $8 million and $34 million, respectively, of Consumer Program loans either paid off during the no interest promotional period or converted to amortizing at the end of the promotional period.

ASSET QUALITY

Nonperforming Assets

The following table presents a comparison of nonperforming assets as of September 30, 2025 and December 31, 2024 ($ in thousands):


	September 30,			December 31,
	2025			2024
Nonaccrual loans	$	84,973		$	15,026
Loans past due 90 days and accruing interest		1,713			1,713
Total nonperforming assets	$	86,686		$	16,739

SBA guaranteed amounts included in nonperforming loans	$	4,682		$	5,921

Allowance for credit losses to total loans		1.40	%		1.86	%
Allowance for credit losses to nonaccrual loans		52.68	%		357.53	%
Allowance for credit losses to nonperforming loans		51.64	%		320.94	%
Nonaccrual to total loans		2.67	%		0.52	%
Nonperforming assets excluding SBA guaranteed loans to total assets		2.07	%		0.29	%

Nonperforming assets increased $70 million, or 418%, as of September 30, 2025 compared to December 31, 2024, which was driven by an increase in nonaccrual loans. The increase in nonaccrual was primarily due to the addition of one commercial real estate loans with a $40 million amortized cost balance that was past due over 30 days as of September 30, 2025 and one commercial relationship comprised of two loans totaling $24 million in amortized cost that was past due over 90 days as of September 30, 2025. Despite the commercial real estate loan only being 30-59 days past due, the credit has exhibited certain weaknesses that warranted placing it on nonaccrual, including a decline in occupancy of the underlying office building leading to reduced lease income. We have a lien on the underlying collateral which is

Table of Contents

Class A office space in a desirable location in northern Virginia. The borrower is actively seeking new tenants for vacant office space in the building. We assess expected credit losses on this loan individually and have a $7 million individual reserve against the loan, or 18% of its amortized cost balance, as of September 30, 2025. The commercial loans past due over 90 days were utilized by the customer to support a business acquisition into an existing business. The merged companies have taken longer than anticipated to realize the anticipated reduction in operating costs and the stabilization of revenues. The company became profitable at the end of 2024 and has shown steady improvement during 2025 with anticipation of being able to provide full debt service coverage by the end of 2025 or early in 2026. We assess expected credit losses on this loan individually and have a $5 million individual reserve against the loan, or 20% of its amortized cost balance, as of September 30, 2025

We will generally place a loan on nonaccrual status when it becomes 90 days past due, with the exception of most consumer loans, which are charged off at 120 days past due and Consumer Program loans, which are charged off once they reach 90 days past due. Loans will also be placed on nonaccrual status in cases where we are uncertain whether the borrower can satisfy the contractual terms of the loan agreement. Cash payments received while a loan is categorized as nonaccrual will be recorded as a reduction of principal as long as doubt exists as to future collections.

We maintain appraisals on loans secured by real estate, particularly those categorized as nonperforming loans and potential problem loans. In instances where appraisals reflect reduced collateral values, we make an evaluation of the borrower’s overall financial condition to determine the need, if any, for impairment or write-down to their fair values. If foreclosure occurs, we record OREO at the lower of our recorded investment in the loan or fair value less our estimated costs to sell.

Our loan portfolio losses and delinquencies have been primarily limited by our underwriting standards and portfolio management practices. Whether losses and delinquencies in our portfolio will increase significantly depends upon the value of the real estate securing the loans and economic factors, such as the overall economy, rising or elevated interest rates, historically high or persistent inflation, and recessionary concerns.

Allowance for Credit Losses

We are focused on the asset quality of our loan portfolio, both before and after a loan is made. We have established underwriting standards that we believe are effective in maintaining high credit quality in our loan portfolio. We have experienced loan officers who take personal responsibility for the loans they originate, a skilled underwriting team and highly qualified credit officers that review each loan application carefully.

Our allowance for credit losses is established through charges to earnings in the form of a provision for credit losses. Management evaluates the allowance at least quarterly. In addition, on a quarterly basis, our Board of Directors reviews our loan portfolio, evaluates credit quality, reviews the loan loss provision and the allowance for credit losses and requests management to make changes as may be required. In evaluating the allowance, management and the Board of Directors consider the growth, composition and industry diversification of the loan portfolio, historical loan loss experience, current delinquency levels and all other known factors affecting loan collectability.

The allowance for credit losses is based on the CECL methodology and represents management’s estimate of an amount appropriate to provide for expected credit losses in the loan portfolio. This estimate is based on historical credit loss information adjusted for current conditions and reasonable and supportable forecasts applied to various loan types that compose our portfolio, including the effects of known factors such as the economic environment within our market area will have on net losses. The allowance is also subject to regulatory examinations and determination by the regulatory agencies as to the appropriate level of the allowance.

Table of Contents

The following table sets forth the allowance for credit losses allocated by loan category and the percentage of loans in each category to total loans at the dates indicated ($ in thousands):


	As of September 30,				As of December 31,
	2025				2024
			Percent of				Percent of
	Allowance		Loans by		Allowance		Loans by
	for Credit		Category to		for Credit		Category to
	Losses		Total Loans		Losses		Total Loans
Commercial real estate - owner occupied	$	5,778	15.5	%	$	5,899	16.5	%
Commercial real estate - non-owner occupied		14,631	18.5	%		6,966	21.1	%
Secured by farmland		31	0.1	%		20	0.1	%
Construction and land development		780	3.2	%		1,203	3.5	%
Residential 1-4 family		6,678	17.6	%		6,819	20.4	%
Multi- family residential		1,397	4.3	%		1,620	5.4	%
Home equity lines of credit		438	2.0	%		533	2.2	%
Commercial loans		10,394	28.6	%		10,794	21.1	%
Paycheck Protection Program loans		—	0.1	%		—	0.1	%
Consumer loans		4,425	10.0	%		19,625	9.4	%
PCD loans		214	0.1	%		245	0.2	%
Total	$	44,766	100.0	%	$	53,724	100.0	%

The following table presents an analysis of the allowance for credit losses for the periods indicated ($ in thousands):


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2025			2024			2025			2024
Balance, beginning of period	$	45,985		$	51,574		$	53,724		$	52,209
Provision charged to operations:
Total provisions		(49)			7,511			9,850			17,138
Recoveries credited to allowance:
Residential 1-4 family		—			—			—			2
Home equity lines of credit		1			1			3			3
Commercial loans		—			18			—			20
Consumer loans		2,530			417			11,956			1,791
Total recoveries		2,531			467			11,959			1,847
Total		48,467			59,552			75,533			71,194
Loans charged off:
Residential 1-4 family		—			—			67			—
Commercial loans		1			580			933			926
Consumer loans		3,700			7,840			29,767			19,136
Total loans charged-off		3,701			8,420			30,767			20,062
Net charge-offs		1,170			7,953			18,808			18,215
Balance, end of period	$	44,766		$	51,132		$	44,766		$	51,132

Net charge-offs to average loans, net of unearned income		0.04	%		0.24	%		0.62	%		0.56	%

We believe that the allowance for credit losses as of September 30, 2025 is sufficient to absorb future expected credit losses in our loan portfolio based on our assessment of all known factors affecting the collectability of our loan portfolio. Our assessment involves uncertainty and judgment; therefore, the adequacy of the allowance for credit losses cannot be determined with precision and may be subject to change in future periods. In addition, bank regulatory authorities, as part of their periodic examination, may require additional charges to the provision for credit losses in future periods if the results of their reviews warrant additions to the allowance for credit losses.

Table of Contents

Our allowance for credit losses was $45 million as of September 30, 2025, compared to $54 million as of December 31, 2024. The $8 million decrease was driven by $19 million in net charge-offs during the nine months ended September 30, 2025, primarily a result of Consumer Program loans, and less provision for credit losses. Our provision for credit losses decreased $8 million and $7 million during the three and nine months ended September 30, 2025 compared to the same periods in 2024, respectively, primarily related to improved performance in the Consumer Program portfolio driven by the significant decline in promotional loans that drove prior credit losses, a changing mix of the Bank’s loan portfolio to loan categories with lower reserve requirements, and the $53 million of commercial loans moved to LHFS as of September 30, 2025 due to our intent to sell the loans. Partially offsetting these declines was specific provisions for expected credit losses of $7 million on the individually evaluated commercial real estate loan that was 30-59 days past due and proactively placed on nonaccrual during the nine months ended September 30, 2025.

Net charge-offs were primarily related to the Consumer Program portfolio during the three and nine months ended September 30, 2025 and 2024. During the three and nine months ended September 30, 2025, we charged-off $1 million and $17 million, respectively, net of recoveries, in the Consumer Program portfolio. Comparatively, during the three and nine months ended September 30, 2024, we charged-off $8 million and $18 million, respectively, net of recoveries. A majority of these charge-offs related to loans originated from the third quarter of 2022 through the first quarter of 2023 where we experienced significant credit weaknesses. When excluding the Consumer Program net charge-offs, we had net charge-offs of $300 thousand and $2 million during the three and nine months ended September 30, 2025, respectively, and net charge-offs of $4 million and $6 million during the three and nine months ended September 30, 2024, respectively.

Provision for the Consumer Program portfolio has subsided significantly since 2024 and was $274 thousand in the third quarter of 2025 and $2 million during the nine months ended September 30, 2025, because the earlier vintage promotional loans that have resulted in a majority of our previous credit losses have mostly converted to amortizing in 2024 or early 2025. We believe that any remaining loans in these older vintages, along with newer vintage promotional loans that end their promotional period over the next two quarters have been considered in our reserving methodology based on our loss experience from 2024 to the first quarter of 2025 with the earlier vintage promotional loans. Specifically, our methodology was updated to consider promotional loan maturity and amount of first payment defaults with eventual charge-off, which was a key driver to charge-offs of these loans in 2024 and the first quarter of 2025. We have also implemented loss mitigation efforts that include working with promotional loan borrowers both prior to the end of the promotional period and once a borrower defaults in order to maximize collectability. A combination of these factors, along with the remaining balance of promotional loans of only $7 million, resulted in our lower provisioning for the three and nine months ended September 30, 2025 and lower ending allowance balance at September 30, 2025.

As of September 30, 2025, the principal balance outstanding of Consumer Program loans was $110 million, excluding a $9 million discount as a result of our prior decision to market a majority of the portfolio for sale, which has since been moved back to LHFI and will be run-off over time. These loans are accounted for like our other consumer loans and are not placed on nonaccrual because they are charged off when they become 90 days past due. The allowance on this portfolio plus the discount resulted in a reduction of the outstanding principal balance of $11 million, or 10%. As of September 30, 2025, 93% of the outstanding principal balance was current, resulting in 135% coverage by the aggregate allowance and discount of the non-current principal balances.

Table of Contents

INVESTMENT SECURITIES

Our investment securities portfolio provides us with required liquidity and collateral to pledge to secure public deposits, certain other deposits, advances from the FHLB of Atlanta, and repurchase agreements.

AFS and HTM investment securities totaled $243 million as of September 30, 2025, a decrease of 1% from $245 million as of December 31, 2024, primarily due to improvement in unrealized losses on AFS securities and paydowns, maturities, and calls of the AFS and HTM investments over the past nine months, partially offset by purchases of AFS securities during that time. We recognized no credit impairment charges related to credit losses on our HTM investment securities during the three and nine months ended September 30, 2025.

The following table sets forth a summary of the investment securities portfolio as of the dates indicated. AFS investment securities are reported at fair value, and HTM investment securities are reported at amortized cost ($ in thousands).


	September 30,		December 31,
	2025		2024
Available-for-sale investment securities:
Residential government-sponsored mortgage-backed securities	$	92,653	$	91,407
Obligations of states and political subdivisions		28,977		29,705
Corporate securities		9,220		15,080
Residential government-sponsored collateralized mortgage obligations		60,819		56,390
Government-sponsored agency securities		14,530		13,836
Agency commercial mortgage-backed securities		21,942		22,178
SBA pool securities		6,519		7,307
Total	$	234,660	$	235,903

Held-to-maturity investment securities:
Residential government-sponsored mortgage-backed securities	$	6,893	$	7,760
Obligations of states and political subdivisions		1,519		1,519
Residential government-sponsored collateralized mortgage obligations		138		169
Total	$	8,550	$	9,448

Debt investment securities that we have the positive intent and ability to hold to maturity are classified as HTM and are carried at amortized cost. Investment securities classified as AFS are those debt securities that may be sold in response to changes in interest rates, liquidity needs or other similar factors. Investment securities AFS are carried at fair value, with unrealized gains or losses net of deferred taxes, included in accumulated other comprehensive income (loss) in stockholders’ equity. Our portfolio of AFS securities currently contains a material amount of unrealized mark-to-market adjustments due to increases in market interest rates since the original purchase of many of these securities. We intend to hold these securities until maturity or recovery of the value and do not anticipate realizing any losses on the investments.

For additional information regarding investment securities refer to “Note 2 - Investment Securities” in this Form 10-Q.

Table of Contents

DEPOSITS AND OTHER BORROWINGS

Deposits

The market for deposits is competitive. We offer a line of traditional deposit products that currently include noninterest-bearing and interest-bearing checking (or NOW accounts), commercial checking, money market accounts, savings accounts and certificates of deposit. We compete for deposits through our banking branches with competitive pricing, as well as nationally through advertising and online banking. We use deposits as a principal source of funding for our lending, purchasing of investment securities and for other business purposes. We seek to fund increased loan volumes by growing core deposits, but, subject to internal policy limits on the amount of funding we may maintain, we may use funding sources to fund shortfalls, if any, or to provide additional liquidity. We use purchased brokered deposits as part of our overall liquidity management strategy on an as needed basis, and we purchase such brokered deposits through nationally recognized networks.

The variety of deposit accounts we offer allows us to be competitive in obtaining funds and in responding to the threat of disintermediation (the flow of funds away from depository institutions such as banking institutions into direct investment vehicles such as government and corporate securities). Our ability to attract and maintain deposits, and the effect of such retention on our cost of funds, has been, and will continue to be, significantly affected by the general economy and market rates of interest.

Total deposits increased by $165 million to $3.3 billion as of September 30, 2025 from $3.2 billion at December 31, 2024. The mix of deposits changed during the nine months ended September 30, 2025, including an increase in lower-cost demand, NOW deposit balances and savings balances of $247 million, offset by a decline in money market and time deposit account balances of $82 million. The driver of the increase since year end has been due to growth of noninterest bearing and lower cost interest bearing deposit accounts generated by the Panacea and Mortgage Warehouse lines of business that have focused on this deposit growth to cost-effectively fund their loan growth. We have no wholesale deposit funding at September 30, 2025 or December 31, 2024.

Our deposits are diversified in type and by underlying customers and lack significant concentrations to any type of customer (i.e. commercial, consumer, government) or industry. Deposits are net of excess amounts we sweep off balance sheet to manage liquidity. Deposits swept off our balance sheet were zero as of September 30, 2025, compared to $137 million as of December 31, 2024. The decline since year end was driven by the growth in our loan portfolio, which required us to retain more deposits on our balance sheet.

Uninsured deposits are defined as the portion of deposit accounts in U.S. offices that exceed the FDIC insurance limit and amounts in any other uninsured investment or deposit accounts that are classified as deposits and are not subject to any federal or state deposit insurance regimes. Total uninsured deposits as calculated per regulatory guidance were $831 million, or 25% of total deposits at the Bank, as of September 30, 2025.

The following table sets forth the average balance and average rate paid on each of the deposit categories for the nine months ended September 30, 2025 and 2024 ($ in thousands):


	2025				2024
	Average		Average		Average		Average
	Balance		Rate		Balance		Rate
Noninterest-bearing demand deposits	$	465,327			$	440,172
Interest-bearing deposits:
Savings accounts		853,474	3.49	%		844,531	4.09	%
Money market accounts		767,729	2.77	%		832,531	3.33	%
NOW and other demand accounts		820,859	2.23	%		766,800	2.43	%
Time deposits		329,832	3.48	%		426,557	3.90	%
Total interest-bearing deposits		2,771,894	2.92	%		2,870,419	3.40	%
Total deposits	$	3,237,221			$	3,310,591

Table of Contents

Other Borrowings

We use other borrowed funds to support our liquidity needs and to temporarily satisfy our funding needs from increased loan demand and for other shorter-term purposes. We are a member of the FHLB and are authorized to obtain advances from the FHLB from time to time, as needed. The FHLB has a credit program for members with different maturities and interest rates, which may be fixed or variable. We are required to collateralize our borrowings from the FHLB with purchases of FHLB stock and other collateral acceptable to the FHLB. As of September 30, 2025 and December 31, 2024, we had $85 million and no FHLB borrowings, respectively. The FHLB borrowings at September 30, 2025 are short-term borrowings that were obtained in September 2025 primarily to fund increased loan growth experienced at the end of the quarter. As of September 30, 2025, we had $262 million of unused and available FHLB lines of credit as well as $595 million of available credit with the FRB, secured by excess collateral pledged to the FHLB and FRB in the form of loans and investment securities.

Other borrowings can consist of federal funds purchased, secured borrowings due to failed loan sales, and repo transactions that mature within one year, which are secured transactions with customers. The balance in repo accounts at both September 30, 2025 and December 31, 2024 was $4 million.

We had secured borrowings of $15 million and $17 million as of September 30, 2025 and December 31, 2024, respectively, related to loan transfers to other financial institutions during 2023 and 2024 that did not meet the criteria to be treated as a sale under applicable accounting guidance. These borrowings reflect the cash received for transferring the loans to the other financial institution and any unamortized sale premium and are secured by approximately the same amount of loans held for investment that are recorded in our balance sheet. We retained the servicing of the loans that were transferred and accordingly receive principal and interest from the borrower as contractually required and transfer the interest to the other financial institution net of our contractually agreed upon servicing fee. The loans transferred have an average maturity of approximately ten years, which will be the time over which the principal balance of the loans in our balance sheet and secured borrowings will pay down, absent borrower prepayments. For additional information on secured borrowings refer to “Note 7 –Debt and Other Borrowings” in this Form 10-Q.

JUNIOR SUBORDINATED DEBT AND SENIOR SUBORDINATED NOTES

For information about junior subordinated debt and senior subordinated notes and their anticipated principal repayments refer to “Note 7 –Debt and Other Borrowings.”

Table of Contents

LIQUIDITY AND FUNDS MANAGEMENT

The objective of our liquidity management is to ensure the ability to meet our financial obligations. These obligations include the payment of deposits on demand or at maturity, the repayment of borrowings at maturity and the ability to fund commitments and other new business opportunities. We obtain funding from a variety of sources, including customer deposit accounts, customer certificates of deposit and payments on our loans and investments. If our level of core deposits is not sufficient to fully fund our lending activities, we have access to funding from additional sources, including but not limited to, borrowing from the FHLB and institutional certificates of deposits. In addition, we maintain federal funds lines of credit with two correspondent banks, totaling $75 million, and utilize securities sold under agreements to repurchase and reverse repurchase agreement borrowings from approved securities dealers as needed. For additional information about borrowings and anticipated principal repayments refer to “Note 7 –Debt and Other Borrowings” and “Note 9 – Commitments and Contingencies”.

We prepare a cash flow forecast on a 30, 60 and 90 day basis along with a one and two year basis. These projections incorporate expected cash flows on loans, investment securities, and deposits based on data used to prepare our interest rate risk analyses. As of September 30, 2025, we were not aware of any known trends, events or uncertainties that have or are reasonably likely to have a material impact on our liquidity. As of September 30, 2025, we had no material commitments or long-term debt for capital expenditures.

Impact of Inflation and Changing Prices

The financial statements and related financial data presented in Item 1 “Financial Statements” of this Quarterly Report have been prepared in accordance with GAAP, which require the measurement of financial position and operating results in terms of historical dollars, without considering changes in the relative purchasing power of money over time due to inflation. The primary impact of inflation on our operations is reflected in increased operating costs. Unlike most industrial companies, substantially all of the assets and liabilities of a financial institution are monetary in nature. As a result, changes in interest rates have a more significant impact on our performance than the effects of changes in the general rate of inflation and changes in prices do. Interest rates do not necessarily move in the same direction or in the same magnitude as the prices of goods and services. Many factors impact interest rates, including the decisions of the FRB, inflation, recession, changes in unemployment, the money supply, and international disorder and instability in domestic and foreign financial markets. Like most financial institutions, changes in interest rates can impact our net interest income, which is the difference between interest earned from interest-earning assets, such as loans and investment securities, and interest paid on interest-bearing liabilities, such as deposits and borrowings, as well as the valuation of our assets and liabilities.

Table of Contents

CAPITAL RESOURCES

Capital management consists of providing equity to support both current and future operations. Primis Financial Corp. and its subsidiary, Primis Bank, are subject to various regulatory capital requirements administered by the 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 our financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action (“PCA”), we must meet specific capital guidelines that involve quantitative measures of our assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. As of September 30, 2025 and December 31, 2024, the most recent regulatory notifications categorized the Bank as well capitalized under regulatory framework for PCA. Federal banking agencies do not provide a similar well capitalized threshold for bank holding companies.

Quantitative measures established by regulation to ensure capital adequacy require us to maintain minimum amounts and ratios of Total and Tier I capital (as defined in the regulations) to average assets (as defined in the regulations). Management believes, as of September 30, 2025, that we meet all capital adequacy requirements to which we are subject.

The following table provides a comparison of the leverage and risk-weighted capital ratios of Primis Financial Corp. and Primis Bank at the periods indicated to the minimum and well-capitalized required regulatory standards:


	Minimum
	Required for
	Capital		To Be		Actual Ratio at
	Adequacy		Categorized as		September 30,		December 31,
	Purposes		Well Capitalized⁽¹⁾		2025		2024
Primis Financial Corp.
Leverage ratio	4.00	%	n/a		8.32	%	7.76	%
Common equity tier 1 capital ratio	4.50	%	n/a		8.62	%	8.74	%
Tier 1 risk-based capital ratio	6.00	%	n/a		8.91	%	9.05	%
Total risk-based capital ratio	8.00	%	n/a		12.02	%	12.53	%

Primis Bank
Leverage ratio	4.00	%	5.00	%	9.34	%	9.10	%
Common equity tier 1 capital ratio	7.00	%	6.50	%	10.14	%	10.78	%
Tier 1 risk-based capital ratio	8.50	%	8.00	%	10.14	%	10.78	%
Total risk-based capital ratio	10.50	%	10.00	%	11.39	%	12.04	%

(1)	Prompt corrective action provisions are not applicable at the bank holding company level.

Bank regulatory agencies have approved regulatory capital guidelines (“Basel III”) aimed at strengthening existing capital requirements for banking organizations. The Basel III Capital Rules require Primis Financial Corp. and Primis Bank to maintain (i) a minimum ratio of Common Equity Tier 1 capital to risk-weighted assets of at least 4.5%, plus a 2.5% “capital conservation buffer”, (ii) a minimum ratio of Tier 1 capital to risk-weighted assets of at least 6.0%, plus the capital conservation buffer, (iii) a minimum ratio of Total capital to risk-weighted assets of at least 8.0%, plus the capital conservation buffer and (iv) a minimum leverage ratio of 4.0%. Failure to meet minimum capital requirements may result in certain actions by regulators which could have a direct material effect on the consolidated financial statements.

Primis Financial Corp. and Primis Bank remain well-capitalized under Basel III capital requirements. Primis Bank had a capital conservation buffer of 3.39% and 4.04% as of September 30, 2025 and December 31, 2024, respectively, which exceeded the 2.50% minimum requirement below which the regulators may impose limits on distributions.

Primis Bank’s capital position is consistent with being well-capitalized under the regulatory framework for PCA.

Table of Contents

NON-GAAP FINANCIAL MEASURES

The following tables provide additional details and reconciliation of our non-GAAP metrics used in this Quarterly Report and a reconciliation to the most comparable GAAP metric ($ in thousands except per share data).


	September 30,		December 31,
	2025		2024
Primis stockholders' equity (GAAP)	$	382,153	$	351,756
Less: Goodwill and Intangible assets		93,502		94,124
Tangible Primis stockholders' equity (Non-GAAP)	$	288,651	$	257,632

Shares outstanding at end of period		24,644,385		24,722,734

Book Value per share (GAAP)	$	15.51	$	14.23
Effect of goodwill and other intangible assets		3.80		3.81
Tangible Book Value per share (Non-GAAP)	$	11.71	$	10.42

CRITICAL ACCOUNTING POLICIES

The critical accounting policies are discussed in the MD&A in our Annual Report on Form 10-K for the year ended December 31, 2024. Significant accounting policies and changes in accounting principles and effects of new accounting pronouncements are discussed in “Note 1 - Organization and Significant Accounting Policies” in the Form 10-K for the year ended December 31, 2024. Disclosures regarding changes in our significant accounting policies since year end and the effects of new accounting pronouncements are included in “Note 1 - Accounting Policies” in this Form 10-Q. There have been no changes to the significant accounting policies during the nine months ended September 30, 2025. Notwithstanding, we are providing an update to the Goodwill discussion from our Form 10-K to describe the results of our annual impairment testing performed during the quarter.

Goodwill

As discussed in our Form 10-K for the year ended December 31, 2024, we are required to test goodwill for impairment at least annually and that test is performed as of September 30 of each year. Our goodwill is allocated to our two reporting units, Primis Bank and Primis Mortgage, and as of September 30, 2025, $91 million of goodwill is allocated to the Primis Bank reporting unit and $3 million is allocated to the Primis Mortgage reporting unit. As of September 30, 2025, we elected to forgo a qualitative assessment allowed under U.S. GAAP and performed a quantitative assessment to test goodwill for impairment. As part of our impairment assessment, the fair value of each reporting unit was estimated using a combination of a market and income approach. The income approach is a valuation technique under which we estimate future cash flows using the financial forecast from the perspective of an unrelated market participant and a terminal value was then applied to the projected cash flow stream. Future estimated cash flows were discounted to their present value to calculate the estimated fair value. The market valuation approach evaluated transactions of comparable banks and considered market pricing ratios of public bank peers. As of September 30, 2025, the estimated fair value exceeded the carrying value of the Primis Mortgage reporting unit and no goodwill impairment was required.

As of September 30, 2025, the estimated fair value of the Primis Bank reporting unit was 118% of the carrying value of the reporting unit, and no goodwill impairment was required. Fair value determinations utilized in the quantitative goodwill impairment test for the Primis Bank reporting unit required considerable judgment and is sensitive to changes in underlying assumptions, estimates, and market factors. Estimating the fair value of the reporting unit requires us to make assumptions and estimates regarding future plans, as well as industry, economic, and regulatory conditions. These assumptions and estimates at September 30 included estimated future annual interest income and interest expense, lending and deposit interest rates, Fed borrowing rates, discount rates, growth rates of the Bank and its loan and deposit portfolio, credit losses on the loan portfolio, and other market factors. We also make assumptions in certain testing methodologies

Table of Contents

about the composition of our peers and market acquisition transactions related to banks that we believe are similar to us. If current expectations of future growth rates, interest rates, provision for credit losses, and margins are not met, if market factors outside of our control, such as discount rates, Fed borrowing rates, or inflation, change, or if management’s expectations or plans otherwise change, including updates to long-term operating plans, then the fair value of the reporting unit may decline below its carrying value and result in goodwill impairment in the future.

Table of Contents

ITEM 3 – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are engaged primarily in the business of investing funds obtained from deposits and borrowings into interest-earning loans and investments. Consequently, our earnings significantly depend on our net interest income, which is the difference between the interest income on loans and other investments and the interest expense on deposits and borrowings. To the extent that our interest-bearing liabilities do not reprice or mature at the same time as our interest-earning assets, we are subject to interest rate risk and corresponding fluctuations in net interest income. Our ALCO meets regularly and is responsible for reviewing our interest rate sensitivity position and establishing policies to monitor and limit exposure to interest rate risk. The policies established by the ALCO are reviewed and approved by our Board of Directors. We have employed asset/liability management policies that seek to manage our net interest income, without having to incur unacceptable levels of credit or investment risk.

We use simulation modeling to manage our interest rate risk and review quarterly interest sensitivity. This approach uses a model which generates estimates of the change in our EVE over a range of interest rate scenarios. EVE is the present value of expected cash flows from assets, liabilities and off-balance sheet contracts using assumptions including estimated loan prepayment rates, reinvestment rates and deposit decay rates.

The following tables are based on an analysis of our interest rate risk as measured by the estimated change in EVE resulting from instantaneous and sustained parallel shifts in the yield curve (plus 400 basis points or minus 400 basis points, measured in 100 basis point increments) as of September 30, 2025 and December 31, 2024. All changes are within our Asset/Liability Risk Management Policy guidelines ($ amounts in thousands).


	Sensitivity of EVE
	As of September 30, 2025
	EVE						EVE as a % of
Change in Interest Rates			$ Change		% Change		Total		Equity
in Basis Points (Rate Shock)	Amount		From Base		From Base		Assets		Book Value
Up 400	$	507,304	$	(107,824)	(17.53)	%	12.83	%	132.75	%
Up 300		538,440		(76,688)	(12.47)	%	13.61	%	140.90	%
Up 200		566,326		(48,802)	(7.93)	%	14.32	%	148.19	%
Up 100		603,250		(11,878)	(1.93)	%	15.25	%	157.86	%
Base		615,128		—	—	%	15.55	%	160.96	%
Down 100		613,414		(1,714)	(0.28)	%	15.51	%	160.52	%
Down 200		588,849		(26,279)	(4.27)	%	14.89	%	154.09	%
Down 300		548,569		(66,559)	(10.82)	%	13.87	%	143.55	%
Down 400		478,676		(136,452)	(22.18)	%	12.10	%	125.26	%


	Sensitivity of EVE
	As of December 31, 2024
	EVE						EVE as a % of
Change in Interest Rates			$ Change		% Change		Total		Equity
in Basis Points (Rate Shock)	Amount		From Base		From Base		Assets		Book Value
Up 400	$	438,490	$	(68,444)	(13.50)	%	11.88	%	120.14	%
Up 300		451,722		(55,212)	(10.89)	%	12.24	%	123.77	%
Up 200		464,410		(42,524)	(8.39)	%	12.59	%	127.24	%
Up 100		493,213		(13,721)	(2.71)	%	13.37	%	135.13	%
Base		506,934		—	—	%	13.74	%	138.89	%
Down 100		509,055		2,121	0.42	%	13.80	%	139.47	%
Down 200		493,913		(13,021)	(2.57)	%	13.38	%	135.33	%
Down 300		469,048		(37,886)	(7.47)	%	12.71	%	128.51	%
Down 400		435,781		(71,153)	(14.04)	%	11.81	%	119.40	%

Our interest rate sensitivity is also monitored by management through the use of a model that generates estimates of the change in the NII over a range of interest rate scenarios. NII depends upon the relative amounts of interest-earning assets and interest-bearing liabilities and the interest rates earned or paid on them. In this regard, our model historically assumes that the composition of our interest sensitive assets and liabilities remains constant over the period being measured

Table of Contents

and also assumes that a particular change in interest rates is reflected uniformly across the yield curve regardless of the duration to maturity or repricing of specific assets and liabilities.

During the nine months ended September 30, 2025, we implemented enhancements to our interest rate risk modeling framework, which impacted the NII sensitivity modeling results as of September 30, 2025 seen below. The enhancements include the adoption of non-linear beta and decay assumptions, which reflect industry best practices for modeling deposit behaviors and rate sensitivities. As a result of these changes, the Bank’s overall interest rate risk profile shifted toward a more neutral position. Additionally, the Bank has also steadily increased its portfolio of floating-rate mortgage warehouse loans during the nine months ended September 30, 2025, which when combined with the modeling enhancements increased our asset sensitivity compared to year end as seen in each of the shock scenarios as of September 30, 2025. The results below are within our ALM Policy guidelines as of September 30, 2025 and December 31, 2024 ($ in thousands).


	Sensitivity of NII
	As of September 30, 2025
	Adjusted NII
Change in Interest Rates			$ Change
in Basis Points (Rate Shock)	Amount		From Base
Up 400	$	138,739	$	7,803
Up 300		136,922		5,986
Up 200		134,989		4,053
Up 100		134,102		3,166
Base		130,936		—
Down 100		128,384		(2,552)
Down 200		124,583		(6,353)
Down 300		121,092		(9,844)
Down 400		118,440		(12,496)


	Sensitivity of NII
	As of December 31, 2024
	Adjusted NII
Change in Interest Rates			$ Change
in Basis Points (Rate Shock)	Amount		From Base
Up 400	$	95,367	$	(15,874)
Up 300		98,941		(12,300)
Up 200		102,472		(8,769)
Up 100		107,370		(3,871)
Base		111,241		—
Down 100		114,126		2,885
Down 200		114,960		3,719
Down 300		115,205		3,964
Down 400		115,736		4,495

Sensitivity of EVE and NII are modeled using different assumptions and approaches. Certain shortcomings are inherent in the methodology used in the above interest rate risk measurements. Modeling changes in EVE and NII sensitivity requires the making of certain assumptions that may or may not reflect the manner in which actual yields and costs respond to changes in market interest rates. Accordingly, although the EVE tables and NII tables provide an indication of our interest rate risk exposure at a particular point in time, such measurements are not intended to, and do not, provide a precise forecast of the effect of changes in market interest rates on our net worth and NII.

Table of Contents

ITEM 4 – CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures. Disclosure controls and procedures are our controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934 is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

As of the end of the period covered by this quarterly report on Form 10-Q, under the supervision and with the participation of management, including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), we have evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d -15(e) under the Securities Exchange Act of 1934). Based upon that evaluation, our CEO and CFO have concluded that these controls and procedures are not effective as of the end of the period covered by this Quarterly Report on Form 10-Q. This conclusion was reached as a result of the continued remediation of previously identified material weaknesses in its internal controls over financial reporting as further described in Item 9A in the 2024 Annual Report on Form 10-K.

Notwithstanding the material weaknesses that have not been fully remediated, the Company’s management, including the CEO and CFO, has concluded that the condensed consolidated financial statements, included in this Form 10-Q, as of and for the three and nine months ended September 30, 2025, fairly present, in all material respects, the Company's financial condition, results of operations and cash-flows for the periods presented in conformity with generally accepted accounting principles for interim financial statements.

(b) Changes in Internal Control over Financial Reporting. There were no changes in our internal controls over financial reporting that occurred during the nine months ended September 30, 2025 that materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting. During the nine months ended September 30, 2025, the Company continued to remediate the material weaknesses in its internal control over financial reporting as previously identified and disclosed in Item 9A in the 2024 Annual Report on Form 10-K. Management continues to put controls in place to remediate the previously identified material weaknesses and the material weaknesses will not be remediated until the necessary controls are in place and operating effectively for a sufficient amount of time.

Table of Contents

PART II - OTHER INFORMATION

ITEM 1 – LEGAL PROCEEDINGS

Primis and Primis Bank are from time to time a party, as both plaintiff and defendant, to various claims and proceedings arising in the ordinary course of the Company’s business, including administrative and/or legal proceedings that may include employment-related claims, as well as claims of lender liability, breach of contract, and other similar lending-related claims. While the ultimate resolution of these matters cannot be determined at this time, the Bank’s management presently believes that such matters, individually and in the aggregate, will not have a material adverse effect on the Bank’s financial condition or results of operations. There are no proceedings pending, or to management’s knowledge, threatened, that represent a significant risk against Primis or Primis Bank as of September 30, 2025.

ITEM 1A – RISK FACTORS

In addition to the other information set forth in this Report, in evaluating an investment in the Company’s securities, investors should consider carefully, among other things, the risk factors previously disclosed in Part I, Item 1A of our 2024 Form 10-K, which could materially affect the Company's business, financial position, results of operations, cash flows, or future results. Please be aware that these risks may change over time and other risks may prove to be important in the future. New risks may emerge at any time, and we cannot predict such risks or estimate the extent to which they may affect our business, financial condition or results of operations, or the trading price of our securities.

There are no material changes during the period covered by this Report to the risk factors previously disclosed in our 2024 Form 10-K.

ITEM 2 – UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

The following table sets forth information regarding purchases of our common stock related to our share repurchase program made by us or on our behalf during the three months ended September 30, 2025:


Issuer Purchases of Equity Securities
					Approximate
				Total Number of	Dollar Value of
				Shares	Shares that May
	Total			Purchased as	Yet be
	Number of	Average		Part of Publicly	Purchased
	Shares	Price Paid		Announced Plan	Under the Plan
Period	Purchased	Per Share		or Program	or Program ⁽¹⁾
July 1-31, 2025	—	$	—	—	$	8,287,314
Aug 1-31, 2025	—		—	—		8,479,870
Sep 1-30, 2025	—		—	—		7,783,706
Total	—	$	—	—

(1)

In December 2024, our Board of Directors approved a new share repurchase program authorizing the purchase of up to 740,600 shares of our outstanding common stock beginning on December 19, 2024 and ending on December 19, 2025. This share repurchase authorization replaced our prior share repurchase program authorization that also authorized up to 740,600 shares to be repurchased. The actual amount and timing of future share repurchases, if any, will depend on market and economic conditions, regulatory rules, applicable SEC rules, and various other factors.

ITEM 3 – DEFAULTS UPON SENIOR SECURITIES

Not applicable.

Table of Contents

ITEM 4 – MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5 – OTHER INFORMATION

Pursuant to Item 408(a) of Regulation S-K, none of the Company's directors or executive officers adopted, terminated or modified a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the three and nine months ended September 30, 2025.

Table of Contents

ITEM 6 - EXHIBITS

(a) Exhibits.


Exhibit No.		Description

3.1		Articles of Incorporation (incorporated herein by reference to Exhibit 3.1 to Primis Financial Corp.’s (formerly Southern National’s) Registration Statement on Form S-1 (Registration No. 333-136285) filed August 4, 2006)

3.2		Certificate of Amendment to the Articles of Incorporation dated January 31, 2005 (incorporated herein by reference to Exhibit 3.2 to Primis Financial Corp.’s (formerly Southern National’s) Registration Statement on Form S-1 (Registration No. 333-136285) filed on August 4, 2006)

3.3		Certificate of Amendment to the Articles of Incorporation dated April 13, 2006 (incorporated herein by reference to Exhibit 3.3 to Primis Financial Corp.’s (formerly Southern National’s) Registration Statement on Form S-1 (Registration No. 333-136285) filed on August 4, 2006)

3.4		Articles of Amendment to the Articles of Incorporation dated March 31, 2021 (incorporated herein by reference to Exhibit 3.1 to Primis Financial Corp.’s Current Report on Form 8-K filed on March 31, 2021)

3.5		Articles of Amendment to the Articles of Incorporation dated July 2, 2025 (incorporated herein by reference to Exhibit 3.1 to Primis Financial Corp.’s Current Report on Form 8-K filed on July 2, 2025)

3.6		Second Amended and Restated Bylaws (incorporated herein by reference to Exhibit 3.2 to Primis Financial Corp.’s Current Report on Form 8-K filed on July 2, 2025)

31.1*		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1**		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Table of Contents

101		The following materials from Primis Financial Corp. Quarterly Report on Form 10-Q for the quarter ended September 30, 2025, formatted in Inline XBRL (Extensible Business Reporting Language), filed herewith: (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Income and Comprehensive Income (unaudited), (iii) Condensed Consolidated Statement of Changes in Stockholders’ Equity (unaudited), (iv) Consolidated Statements of Cash Flows (unaudited), and (v) Notes to Unaudited Condensed Consolidated Financial Statements.

104		The cover Page Interactive Data File (the cover page XBRL tags are embedded in the Inline XBRL document).

* Filed with this Quarterly Report on Form 10-Q

** Furnished with this Quarterly Report on Form 10-Q

Table of Contents

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		Primis Financial Corp.
		(Registrant)

November 10, 2025		/s/ Dennis J. Zember, Jr.
(Date)		Dennis J. Zember, Jr.
		President and Chief Executive Officer

November 10, 2025		/s/ Matthew Switzer
(Date)		Matthew Switzer
		Executive Vice President and Chief Financial Officer