July 21, 2026 - 10-Q: Quarterly report [Sections 13 or 15(d)]

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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 June 30, 2026


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

For the transition period from _______ to _______

Commission File Number 001-36722

___________________________________________________________

TRIUMPH FINANCIAL, INC.

(Exact name of registrant as specified in its charter)

___________________________________________________________


Texas						20-0477066
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

12700 Park Central Drive, Suite 1700

Dallas, Texas 75251

(Address of principal executive offices)

(214) 365-6900

(Registrant’s telephone number, including area code)

___________________________________________________________

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 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 x No o

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 x No o

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	x	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
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 o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock — $0.01 par value, 23,894,537 shares, as of July 17, 2026.

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

Title of each class

Trading
Symbol(s)

Name of each exchange on which registered

Common stock, par value $0.01 per share

TFIN

New York Stock Exchange

NYSE Texas

Depositary Shares Each Representing a 1/40th Interest in a Share of 7.125% Series C Fixed-Rate Non-Cumulative Perpetual Preferred Stock, par value $0.01 per share

TFIN PR

New York Stock Exchange

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TRIUMPH FINANCIAL, INC.

FORM 10-Q

June 30, 2026

TABLE OF CONTENTS


PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements
	Consolidated Balance Sheets	2
	Consolidated Statements of Income	3
	Consolidated Statements of Comprehensive Income	4
	Consolidated Statements of Changes in Stockholders’ Equity	5
	Consolidated Statements of Cash Flows	7
	Condensed Notes to Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	49

Item 3.	Quantitative and Qualitative Disclosures About Market Risks	106

Item 4.	Controls and Procedures	108

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	108

Item 1A.	Risk Factors	108

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	108

Item 3.	Defaults Upon Senior Securities	108

Item 4.	Mine Safety Disclosures	109

Item 5.	Other Information	109

Item 6.	Exhibits	110

Table of Contents

PART I – FINANCIAL INFORMATION

ITEM 1

FINANCIAL STATEMENTS

Table of Contents

TRIUMPH FINANCIAL, INC.

CONSOLIDATED BALANCE SHEETS

June 30, 2026 and December 31, 2025

(Dollar amounts in thousands)


	June 30, 2026		December 31, 2025
	(Unaudited)
ASSETS
Cash and due from banks	$	74,039	$	67,535
Interest bearing deposits with other banks	822,772		180,936
Total cash and cash equivalents	896,811		248,471
Securities - equity investments with readily determinable fair values	4,540		4,588
Securities - available for sale	268,118		364,277
Securities - held to maturity, net of allowance for credit losses of $2,105 and $1,628, respectively, fair value of $515 and $1,878, respectively	977		1,550
Loans held for sale	1,405		459
Loans held for investment	5,477,091		4,991,307
Allowance for credit losses	(34,783)		(36,511)
Loans, net of allowance for credit losses	5,442,308		4,954,796
Federal Home Loan Bank and other restricted stock	3,171		14,253
Premises and equipment, net	85,968		91,071
Capitalized software, net	49,873		46,370
Goodwill	355,296		355,296
Intangible assets, net	42,925		47,888
Bank-owned life insurance	65,302		64,887
Deferred tax assets, net	—		181
Other assets	186,991		186,501
Total assets	$	7,403,685	$	6,380,588
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Deposits
Noninterest bearing	$	3,780,765	$	1,901,638
Interest bearing	2,436,624		3,048,578
Total deposits	6,217,389		4,950,216
Federal Home Loan Bank advances	—		280,000
Subordinated notes	69,979		69,879
Junior subordinated debentures	43,321		42,991
Deferred tax liabilities, net	7,187		—
Other liabilities	102,546		95,731
Total liabilities	6,440,422		5,438,817
Commitments and contingencies - See Note 7 and Note 8
Stockholders' equity - See Note 11
Preferred stock	45,000		45,000
Common stock, 23,894,537 and 23,765,385 shares outstanding, respectively	297		295
Additional paid-in-capital	605,940		597,466
Treasury stock, at cost	(272,840)		(270,619)
Retained earnings	587,490		571,368
Accumulated other comprehensive income (loss)	(2,624)		(1,739)
Total stockholders’ equity	963,263		941,771
Total liabilities and stockholders' equity	$	7,403,685	$	6,380,588

See accompanying condensed notes to consolidated financial statements.

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TRIUMPH FINANCIAL, INC.

CONSOLIDATED STATEMENTS OF INCOME

For the Three and Six Months Ended June 30, 2026 and 2025

(Dollar amounts in thousands, except per share amounts)

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Interest and dividend income:
Loans, including fees	$	53,592	$	54,836	$	101,248	$	108,412
Factored receivables, including fees	58,958		44,217		104,979		82,911
Securities	3,904		5,721		8,444		11,029
FHLB and other stock	146		246		418		495
Cash deposits	7,937		4,181		12,203		8,624
Total interest income	124,537		109,201		227,292		211,471
Interest expense:
Deposits	24,027		15,505		38,079		29,902
Subordinated notes	663		661		1,325		1,343
Junior subordinated debentures	965		1,035		1,919		2,029
Other borrowings	56		3,322		1,049		5,136
Total interest expense	25,711		20,523		42,372		38,410
Net interest income	98,826		88,678		184,920		173,061
Credit loss expense (benefit)	2,736		(702)		2,129		628
Net interest income after credit loss expense (benefit)	96,090		89,380		182,791		172,433
Noninterest income:
Service charges on deposits	1,798		1,742		3,010		3,338
Card income	2,129		1,922		4,089		3,719

Net gains (losses) on sale of loans	100		190		187		324
Net gains (losses) on disposal of premises and equipment	(1,779)		(218)		(1,173)		628
Fee income	15,527		12,755		29,262		21,869
Insurance commissions	1,006		1,282		2,117		2,532
Other	2,634		1,711		3,630		4,164
Total noninterest income	21,415		19,384		41,122		36,574
Noninterest expense:
Salaries and employee benefits	60,087		59,882		118,255		118,600
Occupancy, furniture and equipment	6,364		8,139		12,865		16,581
FDIC insurance and other regulatory assessments	1,167		894		2,225		1,621
Professional fees	7,089		(320)		11,852		5,744
Amortization of intangible assets	2,486		3,400		5,002		5,800
Advertising and promotion	1,405		1,838		2,617		3,302
Communications and technology	11,950		12,315		25,069		24,559
Software amortization	3,477		2,865		6,777		4,857
Travel and entertainment	1,208		1,619		2,728		3,111
Other	6,401		10,208		12,505		16,838
Total noninterest expense	101,634		100,840		199,895		201,013
Net income before income tax expense	15,871		7,924		24,018		7,994
Income tax expense	4,501		3,504		6,293		3,557
Net income	$	11,370	$	4,420	$	17,725	$	4,437
Dividends on preferred stock	(802)		(802)		(1,603)		(1,603)
Net income (loss) available to common stockholders	$	10,568	$	3,618	$	16,122	$	2,834
Earnings per common share
Basic	$	0.44	$	0.15	$	0.68	$	0.12
Diluted	$	0.44	$	0.15	$	0.67	$	0.12

See accompanying condensed notes to consolidated financial statements.

Table of Contents

TRIUMPH FINANCIAL, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the Three and Six Months Ended June 30, 2026 and 2025

(Dollar amounts in thousands)

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Net income	$	11,370	$	4,420	$	17,725	$	4,437
Other comprehensive income:
Unrealized gains (losses) on securities:
Unrealized holding gains (losses) arising during the period	(2)		1,019		(1,172)		613
Tax effect	2		(245)		287		(143)
Unrealized holding gains (losses) arising during the period, net of taxes	—		774		(885)		470
Reclassification of amount realized through sale or call securities	—		—		—		—
Tax effect	—		—		—		—
Reclassification of amount realized through sale or call of securities, net of taxes	—		—		—		—
Change in unrealized gains (losses) on securities, net of tax	—		774		(885)		470
Total other comprehensive income (loss)	—		774		(885)		470
Comprehensive income (loss)	$	11,370	$	5,194	$	16,840	$	4,907

See accompanying condensed notes to consolidated financial statements.

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TRIUMPH FINANCIAL, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

For the Three and Six Months Ended June 30, 2026 and 2025

(Dollar amounts in thousands)

(Unaudited)


	Preferred Stock		Common Stock			Additional Paid-in- Capital		Treasury Stock			Retained Earnings		Accumulated		Total Stockholders' Equity
	Liquidation Preference Amount		Shares Outstanding	Par Amount				Shares Outstanding	Cost				Other Comprehensive Income (Loss)
Balance, January 1, 2026	$	45,000	23,765,385	$	295	$	597,466	5,770,441	$	(270,619)	$	571,368	$	(1,739)	$	941,771
Vesting of restricted stock units and performance stock units	—		3,750	—		—		—	—		—		—		—
Stock option exercises, net	—		13,633	—		(211)		—	—		—		—		(211)
Issuance of common stock pursuant to the Employee Stock Purchase Plan	—		24,926	1		1,159		—	—		—		—		1,160
Stock based compensation	—		—	—		3,418		—	—		—		—		3,418

Purchase of treasury stock	—		(1,441)	—		—		1,441	(92)		—		—		(92)
Dividends on preferred stock	—		—	—		—		—	—		(801)		—		(801)
Net income	—		—	—		—		—	—		6,355		—		6,355
Other comprehensive income (loss)	—		—	—		—		—	—		—		(885)		(885)
Balance, March 31, 2026	$	45,000	23,806,253	$	296	$	601,832	5,771,882	$	(270,711)	$	576,922	$	(2,624)	$	950,715


Vesting of restricted stock units and performance stock units	—		119,807	1		(1)		—	—		—		—		—

Stock based compensation	—		—	—		4,109		—	—		—		—		4,109
Purchase of treasury stock	—		(31,523)	—		—		31,523	(2,129)		—		—		(2,129)
Dividends on preferred stock	—		—	—		—		—	—		(802)		—		(802)
Net income	—		—	—		—		—	—		11,370		—		11,370

Balance, June 30, 2026	$	45,000	23,894,537	$	297	$	605,940	5,803,405	$	(272,840)	$	587,490	$	(2,624)	963,263

Table of Contents


	Preferred Stock		Common Stock			Additional Paid-in- Capital		Treasury Stock			Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total Stockholders' Equity
	Liquidation Preference Amount		Shares Outstanding	Par Amount				Shares Outstanding	Cost
Balance, January 1, 2025	$	45,000	23,391,411	$	291	$	567,884	5,729,802	$	(268,356)	$	549,215	$	(3,115)	$	890,919

Vesting of restricted stock and performance stock units	—		8,973	—		—		—	—		—		—		—
Stock option exercises, net	—		495	—		25		—	—		—		—		25
Issuance of common stock pursuant to the Employee Stock Purchase Plan	—		20,892	1		1,367		—	—		—		—		1,368
Stock based compensation	—		—	—		2,831		—	—		—		—		2,831
Forfeiture of restricted stock awards	—		(575)	—		36		575	(36)		—		—		—
Purchase of treasury stock, net	—		(1,456)	—		—		1,456	(128)		—		—		(128)
Dividends on preferred stock	—		—	—		—		—	—		(801)		—		(801)
Net income	—		—	—		—		—	—		17		—		17
Other comprehensive income (loss)	—		—	—		—		—	—		—		(304)		(304)
Balance, March 31, 2025	$	45,000	23,419,740	$	292	$	572,143	5,731,833	$	(268,520)	$	548,431	$	(3,419)	$	893,927
Issuance of common stock	—		256,984	2		12,730		—	—		—		—		12,732
Vesting of restricted stock and performance stock units	—		88,930	1		(1)		—	—		—		—		—

Stock based compensation	—		—	—		3,430		—	—		—		—		3,430

Purchase of treasury stock, net	—		(38,608)	—		—		38,608	(2,099)		—		—		(2,099)
Dividends on preferred stock	—		—	—		—		—	—		(802)		—		(802)
Net income	—		—	—		—		—	—		4,420		—		4,420
Other comprehensive income (loss)	—		—	—		—		—	—		—		774		774
Balance, June 30, 2025	$	45,000	23,727,046	$	295	$	588,302	5,770,441	$	(270,619)	$	552,049	$	(2,645)	$	912,382

See accompanying condensed notes to consolidated financial statements.

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TRIUMPH FINANCIAL, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Six Months Ended June 30, 2026 and 2025

(Dollar amounts in thousands)

(Unaudited)


	Six Months Ended June 30,
	2026		2025
Cash flows from operating activities:
Net income	$	17,725	$	4,437
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation	5,646		7,899
Net accretion on loans	(115)		(778)
Amortization of subordinated notes issuance costs	100		118
Amortization of junior subordinated debentures	330		314
Net (accretion) amortization on securities	(43)		(216)
Amortization of intangible assets	5,002		5,800
Software amortization	6,777		4,857
Deferred taxes, net	7,656		4,164
Credit loss expense (benefit)	2,129		628
Stock based compensation	7,527		6,261

Net (gains) losses on equity securities	48		(81)
Net OREO (gains) losses and valuation adjustments	61		—
Net (gains) losses on disposal of premises and equipment	1,173		(628)
Origination of loans held for sale	(11,059)		(8,627)

Proceeds from sale of loans originated or purchased for sale	10,300		8,101
Net (gains) losses on sale of loans	(187)		(324)
Net change in operating leases	(545)		(217)
Change in estimated fair value of revenue share asset	312		(274)
(Increase) decrease in other assets	(4,498)		(35,407)
Increase (decrease) in other liabilities	2,880		10,152
Net cash provided by (used in) operating activities	51,219		6,179
Cash flows from investing activities:

Purchases of securities available for sale	—		(105,000)

Proceeds from maturities, calls, and pay downs of securities available for sale	95,030		95,028
Proceeds from maturities, calls, and pay downs of securities held to maturity	201		135
Purchases of loans held for investment	(3,682)		(21,742)
Proceeds from sale of loans	535		13,795
Net change in loans	(486,117)		(406,345)
Purchases of premises and equipment	(5,251)		(7,294)
Proceeds from sales of premises and equipment	1,220		11,455
Net proceeds from sale of OREO	10,124		—
Expenditures for capitalized software	(10,280)		(9,897)
(Purchases) redemptions of FHLB and other restricted stock, net	11,082		715
Net cash paid for acquisitions	—		(137,517)
Acquired intangible assets	(39)		(124)

Net cash provided by (used in) investing activities	(387,177)		(566,791)
Cash flows from financing activities:
Net increase (decrease) in deposits	1,267,173		365,278
Increase (decrease) in short term Federal Home Loan Bank advances	(250,000)		150,000
Repayment of long term Federal Home Loan Bank advances	(30,000)		—


Preferred stock dividends	(1,603)		(1,603)
Stock option exercises, net	(211)		25
Proceeds from employee stock purchase plan common stock issuance	1,160		1,368
Purchase of treasury stock, net	(2,221)		(2,227)
Net cash provided by (used in) financing activities	984,298		512,841
Net increase (decrease) in cash and cash equivalents	648,340		(47,771)
Cash and cash equivalents at beginning of period	248,471		330,117
Cash and cash equivalents at end of period	896,811		282,346

See accompanying condensed notes to consolidated financial statements.

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TRIUMPH FINANCIAL, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Six Months Ended June 30, 2026 and 2025

(Dollar amounts in thousands)

(Unaudited)


	Six Months Ended June 30,
	2026		2025
Supplemental cash flow information:
Interest paid	$	48,558	$	37,472
Income taxes paid, net	$	648	$	1,642
Cash paid for operating lease liabilities	$	3,358	$	2,952
Supplemental noncash disclosures:
Loans transferred to OREO	$	—	$	1,995
Loans held for investment transferred to loans held for sale	$	535	$	18,075
Assets transferred to assets held for sale	$	2,315	$	—

Lease liabilities arising from obtaining right-of-use assets	$	15,127	$	548

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

Triumph Financial, Inc. (collectively with its subsidiaries, “Triumph Financial”, or the “Company” as applicable) is a financial holding company headquartered in Dallas, Texas, offering a diversified line of banking, factoring, payments, and intelligence services. The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries Triumph CRA Holdings, LLC (“TCRA”), TBK Bank, SSB (“TBK Bank”), and TBK Bank’s wholly owned subsidiary Triumph Insurance Group, Inc. (“TIG”). Substantially all of the Company's products and services (other than certain insurance brokerage activities at TIG) are offered through TBK Bank.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with United States Generally Accepted Accounting Principles (“GAAP”) for interim financial information and in accordance with guidance provided by the Securities and Exchange Commission (“SEC”). Accordingly, the condensed financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all normal and recurring adjustments considered necessary for a fair presentation. Transactions between the subsidiaries have been eliminated. Certain prior period amounts have been reclassified to conform to the current period presentation. These condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. Operating results for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026.

Reportable Segments

The Company has four reportable segments consisting of Banking, Factoring, Payments, and Intelligence. The Company’s Chief Executive Officer uses segment results to evaluate segment performance, develop strategy, and allocate resources. For further discussion of management's operating segments and allocation methodology, see Note 16 – Business Segment Information.

Adoption of New Accounting Standards

In December 2023, the FASB issued Accounting Standards Update 2023-09, “Income Taxes (Topic 740), Improvements to Income Tax Disclosures" ("ASU 2023-09"). ASU 2023-09 requires public entities to disclose in their rate reconciliation table additional categories of information about federal, state and foreign income taxes and to provide more details about the reconciling items in some categories if items meet a quantitative threshold. ASU 2023-09 also requires all entities to disclose income taxes paid, net of refunds, disaggregated by federal, state and foreign taxes for annual periods and to disaggregate the information by jurisdiction based on a quantitative threshold, among other things. ASU 2023-09 is effective for the Company for fiscal years beginning after December 15, 2024 with early adoption permitted. The Company adopted ASU 2023-09 on a prospective basis effective December 31, 2025. Adoption of ASU 2023-09 did not have a material impact on the Company's consolidated financial statements.

In July 2025, the FASB issued Accounting Standards Update 2025-05, “Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses for Accounts Receivable and Contract Assets" ("ASU 2025-05"). ASU 2025-05 provides the option to elect a practical expedient to assume that the current conditions as of the balance sheet date will remain unchanged for the remaining life of the asset when developing a reasonable and supportable forecast as part of estimating expected credit losses on these assets. ASU 2025-05 is effective for the Company for fiscal years beginning after December 15, 2025 and interim periods within those fiscal years. Adoption of ASU 2025-05 did not have a material impact on the Company's consolidated financial statements.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Newly Issued, But Not Yet Effective Accounting Standards

In November 2024, the FASB issued Accounting Standards Update 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40)" ("ASU 2024-03"). ASU 2024-03 requires public entities to provide disaggregated disclosures, in the notes to the financial statements, of certain categories of expenses that are included in expense line items on the face of the income statement. ASU 2024-03 is effective for the Company for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company will update its expense disclosures upon adoption.

In September 2025, the FASB issued Accounting Standards Update 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40), Targeted Improvements to the Accounting for Internal-Use Software" ("ASU 2025-06"). ASU 2025-06 clarified and modernizes the accounting for costs related to internal-use software. The amendments in ASU 2025-06 remove all references to project stages throughout Subtopic 350-40 and clarify the threshold entities apply to begin capitalizing costs. ASU 2025-06 is effective for the Company for fiscal years beginning after December 15, 2027 and interim periods within those fiscal years. The Company is currently evaluating the impact of adoption of ASU 2025-06 on its consolidated financial statements.

In November 2025, the FASB issued Accounting Standards Update 2025-08, “Financial Instruments - Credit Losses (Topic 326), Purchased Loans" ("ASU 2025-08"). ASU 2025-08 expands the use of the gross-up approach in Accounting Standards Codification 326, "Credit Losses", to all purchased seasoned loans. ASU 2025-08 is effective for the Company for fiscal years beginning after December 15, 2026 and interim periods within those fiscal years. The Company is currently evaluating the impact of adoption of ASU 2025-08 on its consolidated financial statements.

USPS Settlement

At June 30, 2025, we carried a receivable (the “Misdirected Payments Receivable”) payable by the United States Postal Service (“USPS”) arising from accounts factored to a large carrier. The balance of such Misdirected Payments Receivable, net of customer reserves, was $19.4 million. The amounts represented by this receivable were paid by the USPS directly to such customer in contravention of notices of assignment delivered to, and previously honored by, the USPS, which amount was then not remitted back to us by such customer as required. The USPS disputed their obligation to make such payment, citing purported deficiencies in the notices delivered to them. We were a party to litigation in the United States Court of Federal Claims against the USPS seeking a ruling that the USPS was obligated to make the payments represented by this receivable directly to us. On June 30, 2025, we reached an agreement with the USPS ("the USPS Settlement") whereby the USPS agreed to pay us $47.5 million to settle the litigation in the United States Court of Federal Claims and certain other related proceedings. Such settlement was entered into as part of a global settlement of the disputes related to the Misdirected Payments Receivable, other amounts we asserted were due to us from USPS for other balances owed to us as a result of their failure to honor our notices of assignment, and certain claims of the large carrier involved in this matter against the USPS for underpayment on certain transportation contracts in which we had a security interest. We received the full $47.5 million settlement proceeds on July 10, 2025. The proceeds of the USPS Settlement were applied as follows:

•$11.5 million to the aforementioned large carrier,

•$19.4 million to relieve the entire balance of Misdirected Payments Receivable, net of customer reserves,

•$1.1 million of interest and fees,

•$7.9 million of legal expense recovery

•$3.8 million to recovery of previously charged-off acquired over-formula advances related to the aforementioned large carrier, and

•$3.8 million to CVLG in accordance with the amended terms of the CVLG transaction.

The $19.4 million Misdirected Payments Receivable balance was legally discharged upon receipt of the settlement proceeds on July 10, 2025. The USPS Settlement had a $12.4 million and $11.5 million positive impact on pretax net income for the three and six months ended June 30, 2025, respectively, made up of the prior period impacts of the interest and fees, legal expense recovery, and the recovery of the previously charged-off acquired over-formula advances. The USPS Settlement did not have an impact on pretax net income for the three and six months ended June 30, 2026.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Restructuring Activities

In August 2025, the Company announced a reduction in force involving approximately 5% of the Company's workforce, as well as other cost saving initiatives including non-headcount related reductions in facilities, legacy technology, vendor spend, and travel. These actions are part of the Company’s initiatives to re-balance its cost structure in light of technology investments that have delivered significant efficiencies across the organization. These advancements have reduced the need for certain roles and prompted a reorganization of teams and responsibilities to better serve the Company’s transportation verticals. The Company believes these actions will strengthen its competitive position, enhance operational agility, and support sustainable long-term growth.

During the three months ended September 30, 2025, the Company recognized $3,134,000 of expense related to the reduction in force, which consisted primarily of one-time termination charges arising from severance obligations and other customary employee benefit payments made in connection with a reduction in force. These costs were included in salaries and benefits expense in the consolidated statements of income and for segment reporting, $522,000 of the expense was recognized by the Banking segment, $1,059,000 was recognized by the Factoring segment, $513,000 was recognized by the Payments segment, $210,000 was recognized by the Intelligence segment, and $830,000 was allocated to the corporate and other category. The Company's Factoring segment recognized an additional $68,000 of severance expense during the three months ended December 31, 2025.

The Company also recognized $1,250,000 of expense during the three months ended September 30, 2025 related to the cost saving initiatives, which consisted primarily of one-time contract amendment fees. These costs were included in professional fees in the consolidated statements of income and were allocated to the corporate and other category for segment reporting.

All of the restructuring costs were incurred and paid during the year ended December 31, 2025.

NOTE 2 — ACQUISITIONS AND DIVESTITURES

Greenscreens.ai

On May 8, 2025, the Company, through its wholly-owned subsidiary TBK Bank, SSB, acquired Greenscreens AI, Inc. ("Greenscreens"), a pricing solution for the logistics industry that delivers short-term freight market pricing intelligence and business insights.

A summary of the estimated fair values of assets acquired, consideration transferred, and the resulting goodwill is as follows:


(Dollars in thousands)	Initial Values		Measurement Period Adjustments		Adjusted Values
Assets acquired:
Cash and cash equivalents	$	1,601	$	—	$	1,601
Accounts receivable and other	935		—		935
Intangible assets - customer relationship	36,380		(900)		35,480
Intangible assets - software	8,340		(20)		8,320
	47,256		(920)		46,336
Liabilities assumed:
Accounts payable and other	1,104		151		1,255
Deferred tax liabilities, net	6,251		470		6,721
	7,355		621		7,976
Fair value of net assets acquired	$	39,901	$	(1,541)	$	38,360
Consideration:
Cash paid	$	139,118	$	(143)	$	138,975
Stock consideration	12,732		—		12,732
Total consideration	$	151,850	$	(143)	$	151,707
Goodwill	$	111,949	$	1,398	$	113,347

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CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Consideration paid for the acquisition totaled $151,707,000, including $138,975,000 in cash and 256,984 shares of the Company's common stock valued at $12,732,000.

The Company has recognized goodwill of $113,347,000, which included measurement period adjustments related to customary settlement adjustments, intangible asset valuation adjustments, and the finalization of the Greenscreens stub period tax return and its impact on the acquired deferred tax liability. Goodwill was calculated as the excess of the fair value of consideration exchanged as compared to the fair value of identifiable net assets acquired. The goodwill in this acquisition resulted from expected synergies between the Company's Factoring, Payments, and Intelligence segments, as well as progress towards the development of data products to be offered to the freight brokerage community; therefore goodwill of $16,293,000 was allocated to the Company's Factoring segment, $15,601,000 was allocated to the Company's Payments segment, and $81,453,000 was allocated to the Company’s Intelligence segment. The goodwill will not be deducted for tax purposes.

The intangible assets recognized include a customer relationship intangible asset with an acquisition date fair value of $35,480,000 which will be amortized utilizing an accelerated method over its twelve year estimated useful life and a capitalized software intangible asset with an acquisition date fair value of $8,320,000 which will be amortized on a straight-line basis over its five year estimated useful life. A customer relationship intangible asset of $20,860,000 was allocated to the Company's Intelligence segment and a customer relationship intangible asset of $14,620,000 was allocated to the Company's Payments segment. The entire software intangible asset was allocated to the Company's Intelligence segment.

Revenue and earnings of Greenscreens since the acquisition date have not been disclosed as the acquired company was merged into the Company and separate financial information is not readily available.

Expenses related to the acquisition totaling $3,009,000 and $967,000 were recorded in professional fees in the consolidated statements of income during the three months ended June 30, 2025 and March 31, 2025, respectively.

NOTE 3 — SECURITIES

Equity Securities With Readily Determinable Fair Values

The Company held equity securities with readily determinable fair values of $4,540,000 and $4,588,000 at June 30, 2026 and December 31, 2025, respectively. The gross realized and unrealized gains and losses recognized on equity securities with readily determinable fair values included in noninterest income in the Company’s consolidated statements of income were as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in thousands)	2026		2025		2026		2025
Unrealized gains (losses) on equity securities held at the reporting date	$	(19)	$	14	$	(48)	$	81
Realized gains (losses) on equity securities sold during the period	—		—		—		—
	$	(19)	$	14	$	(48)	$	81

Equity Securities Without Readily Determinable Fair Values

The following table summarizes the Company's investments in equity securities without readily determinable fair values:


(Dollars in thousands)	June 30, 2026		December 31, 2025
Equity Securities without readily determinable fair value, at cost	$	65,862	$	75,499
Upward adjustments based on observable price changes, cumulative	10,163		10,163
Impairments and downward adjustments based on observable price changes, cumulative	(1,212)		(1,212)
Equity Securities without readily determinable fair value, carrying value	$	74,813	$	84,450

Equity securities without readily determinable fair values include Federal Home Loan Bank and other restricted stock, which are reported separately in the Company's consolidated balance sheets. Equity securities without readily determinable fair values also include the Company's investments in the common stock of Trax Group, Inc. and Warehouse Solutions Inc., with carrying amounts of $9,700,000 and $38,088,000, respectively, at June 30, 2026. Both investments have been allocated to our Payments segment and are included in other assets in the Company's consolidated balance sheets.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

There were no realized or unrealized gains or losses recognized on equity securities without readily determinable fair values during the three and six months ended June 30, 2026 and 2025.

Management monitors its equity securities without readily determinable fair values for observable transactions in similar equity instruments as well as indicators of impairment, either of which would require it to mark such equity securities to fair value. No such transactions or indicators of impairment were detected during the three and six months ended June 30, 2026.

Debt Securities

Debt securities have been classified in the financial statements as available for sale or held to maturity. The following table summarizes the amortized cost, fair value, and allowance for credit losses of debt securities and the corresponding amounts of gross unrealized gains and losses of available for sale securities recognized in accumulated other comprehensive income (loss) and gross unrecognized gains and losses of held to maturity securities:


(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
June 30, 2026
Available for sale securities:
Mortgage-backed securities, residential	$	84,283	$	173	$	(4,048)	$	—	$	80,408
Asset-backed securities	750		—		(7)		—		743
State and municipal	2,636		—		(48)		—		2,588
CLO securities	182,688		495		—		—		183,183
Corporate bonds	264		—		(4)		—		260
SBA pooled securities	976		8		(48)		—		936
Total available for sale securities	$	271,597	$	676	$	(4,155)	$	—	$	268,118


(Dollars in thousands)	Amortized Cost		Gross Unrecognized Gains		Gross Unrecognized Losses		Fair Value
June 30, 2026
Held to maturity securities:
CLO securities	$	3,082	$	—	$	(2,567)	$	515
Allowance for credit losses	(2,105)
Total held to maturity securities, net of ACL	$	977


(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
December 31, 2025
Available for sale securities:
Mortgage-backed securities, residential	$	91,642	$	462	$	(3,604)	$	—	$	88,500
Asset-backed securities	812		—		(1)		—		811
State and municipal	2,638		—		(49)		—		2,589
CLO Securities	270,148		926		—		—		271,074
Corporate bonds	265		—		(2)		—		263
SBA pooled securities	1,079		10		(49)		—		1,040
Total available for sale securities	$	366,584	$	1,398	$	(3,705)	$	—	$	364,277

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


(Dollars in thousands)	Amortized Cost		Gross Unrecognized Gains		Gross Unrecognized Losses		Fair Value
December 31, 2025
Held to maturity securities:
CLO securities	$	3,178	$	—	$	(1,300)	$	1,878
Allowance for credit losses	(1,628)
Total held to maturity securities, net of ACL	$	1,550

The amortized cost and estimated fair value of securities at June 30, 2026, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.


	Available for Sale Securities				Held to Maturity Securities
(Dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due in one year or less	$	—	$	—	$	—	$	—
Due from one year to five years	2,132		2,120		3,082		515
Due from five years to ten years	30,454		30,522		—		—
Due after ten years	153,002		153,389		—		—
	185,588		186,031		3,082		515
Mortgage-backed securities, residential	84,283		80,408		—		—
Asset-backed securities	750		743		—		—
SBA pooled securities	976		936		—		—
	$	271,597	$	268,118	$	3,082	$	515

There were no sales of debt securities during the three and six months ended June 30, 2026 and 2025.

Debt securities with a carrying amount of approximately $28,933,000 and $28,896,000 at June 30, 2026 and December 31, 2025, respectively, were pledged to secure public deposits and for other purposes required or permitted by law.

Accrued interest on available for sale securities totaled $2,256,000 and $3,387,000 at June 30, 2026 and December 31, 2025, respectively, and was included in other assets on the Company's consolidated balance sheets. There was no accrued interest related to debt securities reversed against interest income for the three and six months ended June 30, 2026 and 2025.

The following table summarizes available for sale debt securities in an unrealized loss position for which an allowance for credit losses has not been recorded, aggregated by investment category and length of time that individual securities have been in a continuous loss position:


	Less than 12 Months				12 Months or More				Total
(Dollars in thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
June 30, 2026
Available for sale securities:
Mortgage-backed securities, residential	$	37,975	$	(382)	$	25,428	$	(3,666)	$	63,403	$	(4,048)
Asset-backed securities	744		(7)		—		—		744		(7)
State and municipal	861		(2)		1,547		(46)		2,408		(48)
CLO securities	—		—		—		—		—		—
Corporate bonds	260		(4)		—		—		260		(4)
SBA pooled securities	—		—		653		(48)		653		(48)
	$	39,840	$	(395)	$	27,628	$	(3,760)	$	67,468	$	(4,155)

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


	Less than 12 Months				12 Months or More				Total
(Dollars in thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
December 31, 2025
Available for sale securities:
Mortgage-backed securities, residential	$	14,533	$	(85)	$	30,284	$	(3,519)	$	44,817	$	(3,604)
Asset-backed securities	811		(1)		—		—		811		(1)
State and municipal	505		—		1,544		(49)		2,049		(49)
CLO Securities	—		—		—		—		—		—
Corporate bonds	—		—		263		(2)		263		(2)
SBA pooled securities	—		—		747		(49)		747		(49)
	$	15,849	$	(86)	$	32,838	$	(3,619)	$	48,687	$	(3,705)

Management evaluates available for sale debt securities in unrealized loss positions to determine whether the impairment is due to credit-related factors or noncredit-related factors. Consideration is given to (1) the extent to which the fair value is less than cost, (2) the financial condition and near-term prospects of the issuer, and (3) the intent and ability of the Company to retain its investment in the security for a period of time sufficient to allow for any anticipated recovery in fair value.

At June 30, 2026, the Company had 72 available for sale debt securities in an unrealized loss position without an allowance for credit losses. Management does not have the intent to sell any of these securities and believes that it is more likely than not that the Company will not have to sell any such securities before a recovery of cost. The fair value is expected to recover as the securities approach their maturity date or repricing date or if market yields for such investments decline. Accordingly, as of June 30, 2026, management believes that the unrealized losses detailed in the previous table are due to noncredit-related factors, including changes in interest rates and other market conditions, and therefore the Company carried no allowance for credit losses on available for sale debt securities at June 30, 2026.

The following table presents the activity in the allowance for credit losses for held to maturity debt securities:


(Dollars in thousands)	Three Months Ended June 30,				Six Months Ended June 30,
Held to Maturity CLO Securities	2026		2025		2026		2025
Allowance for credit losses:
Beginning balance	$	2,104	$	1,476	$	1,628	$	3,491
Credit loss expense	(104)		(97)		372		48
Charge-offs	—		—		—		(2,160)
Recoveries	105		20		105		20
Allowance for credit losses ending balance	$	2,105	$	1,399	$	2,105	$	1,399

The Company’s held to maturity securities are investments in the unrated subordinated notes of collateralized loan obligation ("CLO") funds. These securities are the junior-most in securitization capital structures and are subject to suspension of distributions if the credit of the underlying loan portfolios deteriorates materially. The ACL on held to maturity securities is estimated at each measurement date on a collective basis by major security type. Expected credit losses for these securities are estimated using a discounted cash flow methodology which considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. Ultimately, the realized cash flows on CLO securities such as these will be driven by a variety of factors, including credit performance of the underlying loan portfolio, adjustments to the portfolio by the asset manager, and the timing of a potential call. During the three months ended March 31, 2025, the Company charged off one of its three investments in these CLO funds as it was deemed to be an uncollectible investment. The charge-off was fully reserved in a prior period. At June 30, 2026 and December 31, 2025, $3,082,000 and $1,913,000, respectively, of the Company’s held to maturity securities were classified as nonaccrual.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 4 — LOANS AND ALLOWANCE FOR CREDIT LOSSES

Loans Held for Sale

The following table presents loans held for sale:


(Dollars in thousands)	June 30, 2026		December 31, 2025


1-4 family residential	$	1,405	$	459

Total loans held for sale	$	1,405	$	459

Loans Held for Investment

Loans

The following table presents the amortized cost and unpaid principal balance of loans held for investment:


	June 30, 2026						December 31, 2025
(Dollars in thousands)	Amortized Cost		Unpaid Principal		Difference		Amortized Cost		Unpaid Principal		Difference
Commercial real estate	$	667,520	$	667,661	$	(141)	$	730,435	$	730,533	$	(98)
Construction, land development, land	192,091		192,260		(169)		224,214		224,414		(200)
1-4 family residential	205,540		203,758		1,782		193,508		192,322		1,186
Farmland	42,909		42,935		(26)		43,433		43,474		(41)
Commercial	1,160,128		1,169,548		(9,420)		1,163,664		1,173,373		(9,709)
Factored receivables	2,135,878		2,140,986		(5,108)		1,462,900		1,465,854		(2,954)
Consumer	16,715		16,728		(13)		16,819		16,833		(14)
Mortgage warehouse	1,056,310		1,056,310		—		1,156,334		1,156,334		—
Total loans held for investment	5,477,091		$	5,490,186	$	(13,095)	4,991,307		$	5,003,137	$	(11,830)
Allowance for credit losses	(34,783)						(36,511)
	$	5,442,308					$	4,954,796

The difference between the amortized cost and the unpaid principal is due to (1) premiums and discounts associated with acquired loans totaling $8,596,000 and $9,300,000 at June 30, 2026 and December 31, 2025, respectively, and (2) net deferred origination and factoring fees totaling $4,499,000 and $2,530,000 at June 30, 2026 and December 31, 2025, respectively.

Accrued interest on loans, which is excluded from the amortized cost of loans held for investment, totaled $35,089,000 and $42,478,000 at June 30, 2026 and December 31, 2025, respectively, and was included in other assets on the Company's consolidated balance sheets.

During the three months ended June 30, 2025, the Company acquired a $23,411,000 nonperforming commercial loan for $3,284,000. The loan was purchased credit deteriorated ("PCD") and a $10,780,000 ACL was established on Day 1 resulting in a discount of $9,348,000. Prior to June 30, 2025, the Company determined that the entire $10,780,000 ACL was uncollectible and charged off the entire amount. Such charge-off had no impact on credit loss expense.

As of June 30, 2026, most of the Company’s non-factoring business activity is with customers located within certain states. The states of Texas (20%), Colorado (10%), Illinois (12%), and Iowa (4%) make up 46% of the Company’s gross loans, excluding factored receivables. Therefore, the Company’s exposure to credit risk is affected by changes in the economies in these states. At December 31, 2025, the states of Texas (20%), Illinois (10%), Colorado (10%), and Iowa (4%) made up 44% of the Company’s gross loans, excluding factored receivables.

A majority (97%) of the Company's factored receivables, representing approximately 38% of the Company's total loan portfolio as of June 30, 2026, are transportation receivables. At December 31, 2025, 97% of the Company's factored receivables, representing approximately 29% of the Company's total loan portfolio, were transportation receivables.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

At June 30, 2026 and December 31, 2025, the Company had $374,124,000 and $338,496,000, respectively, of customer reserves associated with factored receivables. These amounts represent customer reserves held to settle any payment disputes or collection shortfalls, may be used to pay customers’ obligations to various third parties as directed by the customer, are periodically released to or withdrawn by customers, and are reported as deposits in the consolidated balance sheets.

Loans with carrying amounts of $1,721,719,000 and $1,725,914,000 at June 30, 2026 and December 31, 2025, respectively, were pledged to secure Federal Home Loan Bank borrowing capacity and Federal Reserve Bank discount window borrowing capacity.

Allowance for Credit Losses

The Company’s estimate of the ACL reflects losses expected over the remaining contractual life of the assets. The contractual term does not consider extensions, renewals or modifications. The activity in the allowance for credit losses (“ACL”) related to loans held for investment is as follows:


(Dollars in thousands)	Beginning Balance		Credit Loss Expense		Charge-offs		Recoveries		Initial ACL on Loans Purchased with Credit Deterioration		Ending Balance
Three Months Ended June 30, 2026
Commercial real estate	$	5,274	$	(410)	$	(668)	$	48	$	—	$	4,244
Construction, land development, land	2,498		420		—		1		—		2,919
1-4 family residential	1,924		210		(74)		26		—		2,086
Farmland	299		2		—		—		—		301
Commercial	12,795		(723)		(1,975)		1,353		—		11,450
Factored receivables	9,827		2,872		(567)		176		—		12,308
Consumer	357		114		(84)		26		—		413
Mortgage warehouse	1,183		(121)		—		—		—		1,062
	$	34,157	$	2,364	$	(3,368)	$	1,630	$	—	$	34,783


(Dollars in thousands)	Beginning Balance		Credit Loss Expense		Charge-offs		Recoveries		Initial ACL on Loans Purchased with Credit Deterioration		Ending Balance
Three Months Ended June 30, 2025
Commercial real estate	$	4,657	$	(518)	$	(5)	$	64	$	—	$	4,198
Construction, land development, land	2,639		199		(250)		1		—		2,589
1-4 family residential	1,446		158		(45)		1		—		1,560
Farmland	326		(24)		—		—		—		302
Commercial	16,191		1,693		(11,132)		281		10,780		17,813
Factored receivables	9,851		(2,638)		(665)		4,005		—		10,553
Consumer	155		368		(91)		34		—		466
Mortgage warehouse	964		246		—		—		—		1,210
	$	36,229	$	(516)	$	(12,188)	$	4,386	$	10,780	$	38,691

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


(Dollars in thousands)	Beginning Balance		Credit Loss Expense		Charge-offs		Recoveries		Initial ACL on Loans Purchased with Credit Deterioration		Ending Balance
Six Months Ended June 30, 2026
Commercial real estate	$	4,713	$	151	$	(668)	$	48	$	—	$	4,244
Construction, land development, land	2,970		(52)		—		1		—		2,919
1-4 family residential	1,927		205		(74)		28		—		2,086
Farmland	298		3		—		—		—		301
Commercial	14,947		(2,625)		(2,233)		1,361		—		11,450
Factored receivables	10,069		4,126		(2,344)		457		—		12,308
Consumer	429		155		(221)		50		—		413
Mortgage warehouse	1,158		(96)		—		—		—		1,062
	$	36,511	$	1,867	$	(5,540)	$	1,945	$	—	$	34,783


(Dollars in thousands)	Beginning Balance		Credit Loss Expense		Charge-offs		Recoveries		Initial ACL on Loans Purchased with Credit Deterioration		Ending Balance
Six Months Ended June 30, 2025
Commercial real estate	$	3,825	$	427	$	(121)	$	67	$	—	$	4,198
Construction, land development, land	2,873		(35)		(250)		1		—		2,589
1-4 family residential	1,404		199		(46)		3		—		1,560
Farmland	386		(84)		—		—		—		302
Commercial	21,419		762		(15,503)		355		10,780		17,813
Factored receivables	9,600		(1,129)		(2,073)		4,155		—		10,553
Consumer	185		470		(270)		81		—		466
Mortgage warehouse	1,022		188		—		—		—		1,210
	$	40,714	$	798	$	(18,263)	$	4,662	$	10,780	$	38,691

The increase in required ACL during the three months ended June 30, 2026 is a function of net charge-offs of $1,738,000 and credit loss expense of $2,364,000.

The decrease in required ACL during the six months ended June 30, 2026 is a function of net charge-offs of $3,595,000 and credit loss expense of $1,867,000.

The Company uses the discounted cash flow (DCF) method to estimate ACL for the commercial real estate, construction, land development, land, 1-4 family residential, commercial (excluding liquid credit), and consumer loan pools. For all loan pools utilizing the DCF method, the Company utilizes and forecasts national unemployment as a loss driver. The Company also utilizes and forecasts either one-year percentage change in national retail sales (commercial real estate – non multifamily, commercial general, commercial agriculture, commercial asset-based lending, commercial equipment finance, consumer), one-year percentage change in the national home price index (1-4 family residential and construction, land development, land), or one-year percentage change in national gross domestic product (commercial real estate – multifamily) as a second loss driver depending on the nature of the underlying loan pool and how well that loss driver correlates to expected future losses. Consistent forecasts of the loss drivers are used across the loan segments. The Company also forecasts prepayments speeds for use in the DCF models with higher prepayment speeds resulting in lower required ACL levels and vice versa for shorter prepayment speeds. These assumed prepayment speeds are based upon our historical prepayment speeds by loan type adjusted for the expected impact of the future interest rate environment. The impact of these assumed prepayment speeds is lesser in magnitude than the aforementioned loss driver assumptions.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

For all DCF models at June 30, 2026, the Company has determined that four quarters represents a reasonable and supportable forecast period and reverts back to a historical loss rate over eight quarters on a straight-line basis. The Company leverages economic projections from a reputable and independent third party to inform its loss driver forecasts over the four-quarter forecast period. Other internal and external indicators of economic forecasts are also considered by the Company when developing the forecast metrics. At June 30, 2026 as compared to December 31, 2025, the Company forecasted minimal change in national unemployment and one-year percentage change in national gross domestic product as well as modest improvement in one-year percentage change in national retail sales and one-year percentage change in national home price index. At June 30, 2026 for national unemployment, the Company projected a percentage in the first quarter that would be slightly higher than the current unemployment rate followed by a gradual rise in the following three quarters. For percentage change in national retail sales, the Company projected an increases in the first two projected quarters followed by a decline to negative levels over the last two projected quarters to a level below recent actual periods. For percentage change in national home price index, the Company projected an increase in the first projected quarter followed by a drop to negative levels for the remaining three quarters with such negative levels peaking in the fourth projected quarter. For percentage change in national gross domestic product, management projected very low growth for the first two projected quarters with low levels of contraction for the final two projected quarters. At June 30, 2026, the Company used its historical prepayment speeds with minimal adjustment.

The Company uses a loss-rate method to estimate expected credit losses for the farmland, liquid credit, factored receivable, and mortgage warehouse loan pools. For each of these loan segments, the Company applies an expected loss ratio based on internal and peer historical losses adjusted as appropriate for qualitative factors. Qualitative loss factors are based on the Company's judgment of company, market, industry or business specific data, changes in underlying loan composition of specific portfolios, trends relating to credit quality, delinquency, non-performing and adversely rated loans, and reasonable and supportable forecasts of economic conditions. Loss factors used to calculate the required ACL on pools that use the loss-rate method reflect the forecasted economic conditions described above.

For the three months ended June 30, 2026, changes in projected loss drivers and prepayment assumptions over the reasonable and supportable forecast period decreased the required ACL by $1,950,000. Changes in loan volume and mix increased the required ACL by $3,145,000. Changes in required specific reserves decreased the ACL by $569,000. Net charge-offs during the period were $1,738,000.

For the three months ended June 30, 2025, changes in projected loss drivers and prepayment assumptions over the reasonable and supportable forecast period decreased the required ACL by $207,000. Changes in loan volume and mix increased the required ACL by $1,185,000. Changes in required specific reserves increased the ACL by $1,484,000. Net charge-offs during the period were $7,802,000.

For the six months ended June 30, 2026, changes in projected loss drivers and prepayment assumptions over the reasonable and supportable forecast period decreased the required ACL by $3,629,000. Changes in loan volume and mix increased the required ACL by $3,255,000. Decreases in required specific reserves decreased the required ACL by $1,354,000. Net charge-offs during the period were $3,595,000.

For the six months ended June 30, 2025, changes in projected loss drivers and prepayment assumptions over the reasonable and supportable forecast period increased the required ACL by $286,000. Changes in loan volume and mix increased the required ACL by $1,787,000. Decreases in required specific reserves decreased the required ACL by $4,095,000. Net charge-offs during the period were $13,601,000.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following table presents the amortized cost basis of collateral dependent loans, which are individually evaluated to determine expected credit losses, and the related ACL allocated to these loans:


(Dollars in thousands)	Real Estate		Accounts Receivable		Equipment		Other		Total		ACL Allocation
June 30, 2026
Commercial real estate	$	59,123	$	—	$	—	$	—	$	59,123	$	—
Construction, land development, land	—		—		—		—		—		—
1-4 family residential	2,276		—		—		—		2,276		2
Farmland	243		—		46		128		417		—
Commercial	105		—		41,140		3,755		45,000		1,565
Factored receivables	—		6,321		—		—		6,321		1,365
Consumer	—		—		—		12		12		—
Mortgage warehouse	—		—		—		—		—		—
Total	$	61,747	$	6,321	$	41,186	$	3,895	$	113,149	$	2,932


(Dollars in thousands)	Real Estate		Accounts Receivable		Equipment		Other		Total		ACL Allocation
December 31, 2025
Commercial real estate	$	25,162	$	—	$	—	$	—	$	25,162	$	—
Construction, land development, land	—		—		—		—		—		—
1-4 family residential	1,827		—		—		—		1,827		—
Farmland	1,177		—		55		138		1,370		—
Commercial	173		—		40,647		4,627		45,447		1,708
Factored receivables	—		4,650		—		—		4,650		2,578
Consumer	—		—		—		12		12		—
Mortgage warehouse	—		—		—		—		—		—
Total	$	28,339	$	4,650	$	40,702	$	4,777	$	78,468	$	4,286

Commercial loans secured by Other collateral primarily consist of large liquid credit loans secured by the underlying enterprise values of the borrowers.

Past Due and Nonaccrual Loans

The following tables present an aging of contractually past due loans:


(Dollars in thousands)	Past Due 30-59 Days		Past Due 60-90 Days		Past Due 90 Days or More		Total Past Due		Current		Total		Past Due 90 Days or More and Accruing
June 30, 2026
Commercial real estate	$	58	$	1,151	$	38,349	$	39,558	$	627,962	$	667,520	$	—
Construction, land development, land	731		—		—		731		191,360		192,091		—
1-4 family residential	223		863		1,754		2,840		202,700		205,540		—
Farmland	217		98		—		315		42,594		42,909		—
Commercial	7,611		7,248		29,985		44,844		1,115,284		1,160,128		—
Factored receivables	26,880		4,199		515		31,594		2,104,284		2,135,878		515
Consumer	3		—		—		3		16,712		16,715		—
Mortgage warehouse	—		—		—		—		1,056,310		1,056,310		—
Total	$	35,723	$	13,559	$	70,603	$	119,885	$	5,357,206	$	5,477,091	$	515

Table of Contents

TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


(Dollars in thousands)	Past Due 30-59 Days		Past Due 60-90 Days		Past Due 90 Days or More		Total Past Due		Current		Total		Past Due 90 Days or More and Accruing
December 31, 2025
Commercial real estate	$	40,346	$	688	$	6,851	$	47,885	$	682,550	$	730,435	$	—
Construction, land development, land	—		—		—		—		224,214		224,214		—
1-4 family residential	370		1,138		1,489		2,997		190,511		193,508		—
Farmland	218		—		—		218		43,215		43,433		—
Commercial	31,105		6,798		13,299		51,202		1,112,462		1,163,664		1,178
Factored receivables	25,876		6,334		1,347		33,557		1,429,343		1,462,900		1,347
Consumer	14		9		—		23		16,796		16,819		—
Mortgage warehouse	—		—		—		—		1,156,334		1,156,334		—
Total	$	97,929	$	14,967	$	22,986	$	135,882	$	4,855,425	$	4,991,307	$	2,525

Given the nature of factored receivables, these assets are disclosed as past due 90 days or more still accruing; however, the Company is not recognizing income on the assets. Historically, any income recognized on factored receivables that are past due 90 days or more has not been material.

The following table presents the amortized cost basis of loans on nonaccrual status and the amortized cost basis of loans on nonaccrual status for which there was no related allowance for credit losses:


	June 30, 2026				December 31, 2025
(Dollars in thousands)	Total Nonaccrual		Nonaccrual With No ACL		Total Nonaccrual		Nonaccrual With No ACL
Commercial real estate	$	42,518	$	42,518	$	8,502	$	8,502
Construction, land development, land	—		—		—		—
1-4 family residential	2,276		2,218		1,790		1,790
Farmland	417		417		458		458
Commercial	44,774		38,216		45,446		38,224
Factored receivables	—		—		—		—
Consumer	12		12		12		12
Mortgage warehouse	—		—		—		—
	$	89,997	$	83,381	$	56,208	$	48,986

The following table presents accrued interest on nonaccrual loans reversed through interest income:


	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in thousands)	2026		2025		2026		2025
Commercial real estate	$	1	$	62	$	265	$	76
Construction, land development, land	—		—		—		—
1-4 family residential	—		2		3		2
Farmland	15		—		15		—
Commercial	3		—		30		3
Factored receivables	—		—		—		—
Consumer	—		—		—		—
Mortgage warehouse	—		—		—		—
	$	19	$	64	$	313	$	81

There was no interest earned on nonaccrual loans during the three and six months ended June 30, 2026 and 2025.

Table of Contents

TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following table presents information regarding nonperforming loans:


(Dollars in thousands)	June 30, 2026		December 31, 2025
Nonaccrual loans	$	89,997	$	56,208
Nonperforming factored receivables	515		1,347
	$	90,512	$	57,555

Credit Quality Information

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt, including: current collateral and financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans as to credit risk on a regular basis. Large groups of smaller balance homogeneous loans, such as consumer loans, are analyzed primarily based on payment status. The Company uses the following definitions for risk ratings:

Pass – Pass rated loans have low to average risk and are not otherwise classified.

Classified – Classified loans are 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 repayment of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Certain classified loans have the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.

Management considers the guidance in ASC 310-20 when determining whether a modification, extension, or renewal of loan constitutes a current period origination. As of June 30, 2026 and December 31, 2025, based on the most recent analysis performed, the risk category of loans is as follows:

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


													Revolving Loans		Revolving Loans Converted To Term Loans		Total
(Dollars in thousands)	Year of Origination
June 30, 2026	2026		2025		2024		2023		2022		Prior
Commercial real estate
Pass	$	14,488	$	195,137	$	73,351	$	98,459	$	30,338	$	146,854	$	5,752	$	829	$	565,208
Classified	—		—		42,600		37,890		3,128		17,773		921		—		102,312
Total commercial real estate	$	14,488	$	195,137	$	115,951	$	136,349	$	33,466	$	164,627	$	6,673	$	829	$	667,520
YTD gross charge-offs	$	—	$	—	$	—	$	2	$	—	$	666	$	—	$	—	$	668

Construction, land development, land
Pass	$	11,385	$	45,118	$	35,557	$	98,267	$	723	$	1,035	$	6	$	—	$	192,091
Classified	—		—		—		—		—		—		—		—		—
Total construction, land development, land	$	11,385	$	45,118	$	35,557	$	98,267	$	723	$	1,035	$	6	$	—	$	192,091
YTD gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

1-4 family residential
Pass	$	35,803	$	51,179	$	31,103	$	13,862	$	7,932	$	29,941	$	30,417	$	2,856	$	203,093
Classified	—		358		319		376		31		1,135		228		—		2,447
Total 1-4 family residential	$	35,803	$	51,537	$	31,422	$	14,238	$	7,963	$	31,076	$	30,645	$	2,856	$	205,540
YTD gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	74	$	—	$	—	$	74

Farmland
Pass	$	2,082	$	8,610	$	10,031	$	2,364	$	3,281	$	13,936	$	1,477	$	316	$	42,097
Classified	—		—		—		—		—		812		—		—		812
Total farmland	$	2,082	$	8,610	$	10,031	$	2,364	$	3,281	$	14,748	$	1,477	$	316	$	42,909
YTD gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Commercial
Pass	$	170,454	$	290,400	$	183,055	$	53,605	$	19,475	$	13,653	$	379,335	$	2,844	$	1,112,821
Classified	3,891		4,820		916		8,673		3,520		3,000		22,487		—		47,307
Total commercial	$	174,345	$	295,220	$	183,971	$	62,278	$	22,995	$	16,653	$	401,822	$	2,844	$	1,160,128
YTD gross charge-offs	$	—	$	1,314	$	2	$	246	$	671	$	—	$	—	$	—	$	2,233

Factored receivables
Pass	$	2,129,832	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	2,129,832
Classified	6,046		—		—		—		—		—		—		—		6,046
Total factored receivables	$	2,135,878	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	2,135,878
YTD gross charge-offs	$	567	$	1,777	$	—	$	—	$	—	$	—	$	—	$	—	$	2,344

Consumer
Pass	$	7,995	$	1,650	$	804	$	549	$	121	$	244	$	5,340	$	—	$	16,703
Classified	—		—		—		—		—		12		—		—		12
Total consumer	$	7,995	$	1,650	$	804	$	549	$	121	$	256	$	5,340	$	—	$	16,715
YTD gross charge-offs	$	182	$	28	$	4	$	7	$	—	$	—	$	—	$	—	$	221

Mortgage warehouse
Pass	$	1,056,310	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	1,056,310
Classified	—		—		—		—		—		—		—		—		—
Total mortgage warehouse	$	1,056,310	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	1,056,310
YTD gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Total loans
Pass	$	3,428,349	$	592,094	$	333,901	$	267,106	$	61,870	$	205,663	$	422,327	$	6,845	$	5,318,155
Classified	9,937		5,178		43,835		46,939		6,679		22,732		23,636		—		158,936
Total loans	$	3,438,286	$	597,272	$	377,736	$	314,045	$	68,549	$	228,395	$	445,963	$	6,845	$	5,477,091
YTD gross charge-offs	$	749	$	3,119	$	6	$	255	$	671	$	740	$	—	$	—	$	5,540

Table of Contents

TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


													Revolving Loans		Revolving Loans Converted To Term Loans		Total
(Dollars in thousands)	Year of Origination
December 31, 2025	2025		2024		2023		2022		2021		Prior
Commercial real estate
Pass	$	194,679	$	167,423	$	57,294	$	32,510	$	66,763	$	96,283	$	2,639	$	841	$	618,432
Classified	—		—		83,865		2,696		1,301		23,453		688		—		112,003
Total commercial real estate	$	194,679	$	167,423	$	141,159	$	35,206	$	68,064	$	119,736	$	3,327	$	841	$	730,435
YTD gross charge-offs	$	—	$	—	$	116	$	—	$	—	$	87	$	—	$	—	$	203

Construction, land development, land
Pass	$	14,821	$	87,037	$	120,397	$	843	$	769	$	347	$	—	$	—	$	224,214
Classified	—		—		—		—		—		—		—		—		—
Total construction, land development, land	$	14,821	$	87,037	$	120,397	$	843	$	769	$	347	$	—	$	—	$	224,214
YTD gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	250	$	—	$	—	$	250

1-4 family residential
Pass	$	54,257	$	41,135	$	15,614	$	11,408	$	14,114	$	18,889	$	31,545	$	2,286	$	189,248
Classified	365		9		899		82		1,120		1,734		51		—		4,260
Total 1-4 family residential	$	54,622	$	41,144	$	16,513	$	11,490	$	15,234	$	20,623	$	31,596	$	2,286	$	193,508
YTD gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	104	$	—	$	—	$	104

Farmland
Pass	$	9,001	$	9,827	$	4,068	$	3,613	$	2,330	$	12,939	$	458	$	358	$	42,594
Classified	—		—		—		—		—		839		—		—		839
Total farmland	$	9,001	$	9,827	$	4,068	$	3,613	$	2,330	$	13,778	$	458	$	358	$	43,433
YTD gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Commercial
Pass	$	335,153	$	225,023	$	82,460	$	32,954	$	7,901	$	13,026	$	417,434	$	2,153	$	1,116,104
Classified	4,409		1,524		10,608		5,478		956		928		23,657		—		47,560
Total commercial	$	339,562	$	226,547	$	93,068	$	38,432	$	8,857	$	13,954	$	441,091	$	2,153	$	1,163,664
YTD gross charge-offs	$	—	$	4,924	$	7,950	$	1,180	$	276	$	10,816	$	—	$	—	$	25,146

Factored receivables
Pass	$	1,458,558	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	1,458,558
Classified	4,342		—		—		—		—		—		—		—		4,342
Total factored receivables	$	1,462,900	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	1,462,900
YTD gross charge-offs	$	5,229	$	1,408	$	—	$	—	$	—	$	—	$	—	$	—	$	6,637

Consumer
Pass	$	9,851	$	1,162	$	778	$	226	$	167	$	314	$	4,309	$	—	$	16,807
Classified	—		—		—		—		—		12		—		—		12
Total consumer	$	9,851	$	1,162	$	778	$	226	$	167	$	326	$	4,309	$	—	$	16,819
YTD gross charge-offs	$	467	$	81	$	13	$	6	$	—	$	18	$	—	$	—	$	585

Mortgage warehouse
Pass	$	1,156,334	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	1,156,334
Classified	—		—		—		—		—		—		—		—		—
Total mortgage warehouse	$	1,156,334	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	1,156,334
YTD gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Total loans
Pass	$	3,232,654	$	531,607	$	280,611	$	81,554	$	92,044	$	141,798	$	456,385	$	5,638	$	4,822,291
Classified	9,116		1,533		95,372		8,256		3,377		26,966		24,396		—		169,016
Total loans	$	3,241,770	$	533,140	$	375,983	$	89,810	$	95,421	$	168,764	$	480,781	$	5,638	$	4,991,307
YTD gross charge-offs	$	5,696	$	6,413	$	8,079	$	1,186	$	276	$	11,275	$	—	$	—	$	32,925

Table of Contents

TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Loan Modifications to Borrowers Experiencing Financial Difficulty

In an effort to mitigate potential losses on loans, the Company will endeavor to work with borrowers experiencing financial difficulty to modify the terms of such loans to improve the likelihood of principal repayment. Such modifications generally fall into four broad categories; principal forgiveness, interest rate reduction, other-than-insignificant payment delay, or a term extension. Modifications can reflect one or multiple modification categories. For all loan types, including commercial real estate loans, the Company considers the likelihood of repayment by the borrower experiencing financial difficulty under the potential agreed upon modified terms. If such repayment is not deemed likely, the Company will not grant the troubled borrower a modification and will commence ultimate collection proceedings. On an ongoing basis, the Company monitors the performance of modified loans related to their restructured terms.

The following tables present the amortized cost basis of loan modifications to borrowers experiencing financial difficulty made during the reporting period:


	Term Extension
					Financial Effect
(Dollars in thousands)	Amortized Cost		% of Portfolio		Term Extended By
Three Months Ended June 30, 2026
Commercial real estate	$	48,161	7.2	%	0.3 years



Commercial	7,139		0.6	%	1.7 years



	$	55,300	1.0	%

Three Months Ended June 30, 2025
Commercial real estate	$	134,268	17.8	%	0.3 years



Commercial	2,087		0.2	%	1.3 years



	$	136,355	2.8	%

Six Months Ended June 30, 2026
Commercial real estate	$	48,161	7.2	%	0.4 years



Commercial	8,283		0.7	%	1.5 years



	$	56,444	1.0	%

Six Months Ended June 30, 2025
Commercial real estate	$	134,268	17.8	%	0.5 years

1-4 family residential	15		—	%	5.0 years

Commercial	2,087		0.2	%	1.3 years



	$	136,370	2.8	%

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


	Term Extension and Payment Delay
					Financial Effect
(Dollars in thousands)	Amortized Cost		% of Portfolio		Term Extended By	Payments Delayed By











Three Months Ended June 30, 2025




Commercial	302		—	%	0.5 years	0.5 years



	$	302	—	%

Six Months Ended June 30, 2026
Commercial real estate	$	654	0.1	%	0.6 years	0.5 years







	$	654	—	%

Six Months Ended June 30, 2025




Commercial	302		—	%	0.8 years	0.8 years



	$	302	—	%


	Payment Delay
					Financial Effect
(Dollars in thousands)	Amortized Cost		% of Portfolio		Payments Delayed By

































Six Months Ended June 30, 2025




Commercial	$	528	—	%	0.5 years



	$	528	—	%

Generally, if a loan to a borrower experiencing financial difficulty is modified, the Company will seek to obtain credit enhancements when possible.

The following table presents the payment status of loans that have been modified in the last twelve months:


	June 30, 2026
(Dollars in thousands)	Current		Past Due 30-89 Days		Past Due 90 Days or More		Total
Commercial real estate	$	66,282	$	654	$	37,554	$	104,490
Construction, land development, land	—		—		—		—
1-4 family residential	8		—		—		8
Farmland	—		—		—		—
Commercial	15,125		442		15		15,582
Factored receivables	—		—		—		—
Consumer	—		—		—		—
Mortgage warehouse	—		—		—		—
	$	81,415	$	1,096	$	37,569	$	120,080

At June 30, 2026, the Company had $0 of commitments to lend additional funds to borrowers experiencing financial difficulty for which the Company modified the terms of the loans in the form of principal forgiveness, an interest rate reduction, an other-than-insignificant payment delay, or a term extension during the current period.

There were $37,554,000 of commercial real estate loans and $15,000 of commercial loans to borrowers experiencing financial difficulty that had a payment default during the six months ended June 30, 2026 and were modified in the form of a term extension in the twelve months prior to that default. There were no loans to borrowers experiencing financial difficulty that had a payment default during the three months ended June 30, 2026 and were modified in the twelve months prior to that default.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

There were no loans to borrowers experiencing financial difficulty that had a payment default during the three and six months ended June 30, 2025 and were modified in the twelve months prior to that default. Default is determined at 90 or more days past due, upon charge-off, or upon foreclosure. Modified loans in default are individually evaluated for the allowance for credit losses or if the modified loan is deemed uncollectible, the loan, or a portion of the loan, is written off and the allowance for credit losses is adjusted accordingly.

Residential Real Estate Loans In Process of Foreclosure

At June 30, 2026 and December 31, 2025, the Company had $30,000 and $371,000, respectively, of 1-4 family residential real estate loans for which formal foreclosure proceedings were in process.

Other Real Estate Owned

At June 30, 2026 and December 31, 2025, the Company had $0 and $10,185,000 of other real estate owned, net.

NOTE 5 — GOODWILL AND INTANGIBLE ASSETS

Goodwill and intangible assets consist of the following:


(Dollars in thousands)	June 30, 2026		December 31, 2025
Goodwill	$	355,296	$	355,296


	June 30, 2026						December 31, 2025
(Dollars in thousands)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Core deposit intangibles	$	43,578	$	(42,367)	$	1,211	$	43,578	$	(41,836)	$	1,742
Customer relationship intangibles	65,494		(32,170)		33,324		65,494		(28,776)		36,718
Software intangible assets	26,932		(19,503)		7,429		26,932		(18,461)		8,471
Other intangible assets	3,681		(2,720)		961		3,641		(2,684)		957
	$	139,685	$	(96,760)	$	42,925	$	139,645	$	(91,757)	$	47,888

The changes in goodwill and intangible assets during the three and six months ended June 30, 2026 and 2025 are as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in thousands)	2026		2025		2026		2025
Beginning balance	$	400,668	$	255,912	$	403,184	$	258,208
Acquired goodwill	—		111,951		—		111,951
Acquired intangible assets	39		44,721		39		44,844




Amortization of intangibles	(2,486)		(3,400)		(5,002)		(5,800)
Amortization of intangibles included in lease income	—		(19)		—		(38)
Ending balance	$	398,221	$	409,165	$	398,221	$	409,165

NOTE 6 — VARIABLE INTEREST ENTITIES

Collateralized Loan Obligation Funds – Closed

The Company holds investments in the subordinated notes of the following closed Collateralized Loan Obligation (“CLO”) funds:


(Dollars in thousands)	Offering Date	Offering Amount
Trinitas CLO IV, LTD (Trinitas IV)	June 2, 2016	$	406,650

Trinitas CLO VI, LTD (Trinitas VI)	June 20, 2017	$	717,100

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The net carrying amounts of the Company’s investments in the subordinated notes of the CLO funds, which represent the Company’s maximum exposure to loss as a result of its involvement with the CLO funds, totaled $977,000 and $1,550,000 at June 30, 2026 and December 31, 2025, respectively, and are classified as held to maturity securities within the Company’s consolidated balance sheets.

The Company performed a consolidation analysis to confirm whether the Company was required to consolidate the assets, liabilities, equity or operations of the closed CLO funds in its financial statements. The Company concluded that the closed CLO funds were variable interest entities and that the Company holds variable interests in the entities in the form of its investments in the subordinated notes of entities. However, the Company also concluded that the Company does not have the power to direct the activities that most significantly impact the entities’ economic performance. As a result, the Company was not the primary beneficiary and therefore was not required to consolidate the assets, liabilities, equity, or operations of the closed CLO funds in the Company’s financial statements.

NOTE 7 — LEGAL CONTINGENCIES

TBK Bank, SSB (the “Bank”), the wholly-owned bank subsidiary of the Company, is the agent bank for a $60.5 million floorplan loan facility, of which the Bank holds approximately $22.5 million, for which Tricolor Holdings, LLC (“Tricolor”) is the lead borrower. On September 10, 2025, Tricolor and its affiliates filed for Chapter 7 bankruptcy in the United States District Court for the Northern District of Texas. The floorplan loan facility is secured by a first-priority security interest in the vehicle inventory and certain other assets of Tricolor. As of June 30, 2026, the Bank believes its collateral position adequately secures the outstanding balance of the loan facility. As the bankruptcy proceedings progress, however, the Bank may discover additional information regarding the status of specific collateral securing the loan. Other creditors have asserted that they have interests in some of the collateral in which the Bank asserts a first-priority security interest. To the extent necessary, the bankruptcy court may ultimately have to determine the Bank’s and other creditors’ interest in such collateral. The Company may also be subject to additional claims asserted by creditors or the trustee in the bankruptcy proceedings. Should any of such factual determinations or developments in the bankruptcy proceedings negatively impact the Bank’s assessment of its collateral position or otherwise have a negative impact on the Company, the Company might incur losses which could be material to our business, financial condition and results of operations.

Additionally, other various legal claims have arisen from time to time in the normal course of business which, in the opinion of management as of June 30, 2026, will have no material effect on the Company’s consolidated financial statements.

NOTE 8 — OFF-BALANCE SHEET LOAN COMMITMENTS

From time to time, the Company 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. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the balance sheet. The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments.

The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet financial instruments.

The contractual amounts of financial instruments with off-balance sheet risk were as follows:


	June 30, 2026						December 31, 2025
(Dollars in thousands)	Fixed Rate		Variable Rate		Total		Fixed Rate		Variable Rate		Total
Unused lines of credit	$	69,665	$	331,047	$	400,712	$	92,223	$	440,289	$	532,512
Standby letters of credit	$	5,792	$	6,609	$	12,401	$	7,090	$	2,951	$	10,041

Mortgage warehouse and other loan commitments	$	—	$	852,745	$	852,745	$	—	$	702,984	$	702,984

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being fully drawn upon, the total commitment amounts disclosed above do not necessarily represent future cash requirements. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if considered necessary by the Company, upon extension of credit, is based on management’s credit evaluation of the customer.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. In the event of nonperformance by the customer, the Company has rights to the underlying collateral, which can include commercial real estate, physical plant and property, inventory, receivables, cash and marketable securities. The credit risk to the Company in issuing letters of credit is essentially the same as that involved in extending loan facilities to its customers.

Mortgage warehouse commitments are unconditionally cancellable and represent the unused capacity on mortgage warehouse facilities the Company has approved. The Company reserves the right to refuse to buy any mortgage loans offered for sale by a customer, for any reason, at the Company’s sole and absolute discretion. Other loan commitments represent loans purchased by the Company that have not yet settled.

The Company records an allowance for credit losses on off-balance sheet credit exposures through a charge to credit loss expense on the Company’s consolidated statements of income. At June 30, 2026 and December 31, 2025, the allowance for credit losses on off-balance sheet credit exposures totaled $2,233,000 and $2,342,000, respectively, and was included in other liabilities on the Company’s consolidated balance sheets. The following table presents credit loss expense for off balance sheet credit exposures:


	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in thousands)	2026		2025		2026		2025
Credit loss expense (benefit)	$	476	$	(89)	$	(110)	$	(218)

NOTE 9 — FAIR VALUE DISCLOSURES

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:

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 company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The methods of determining the fair value of assets and liabilities presented in this note are consistent with the methodologies disclosed in Note 15 of the Company’s 2025 Form 10-K.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Assets and liabilities measured at fair value on a recurring basis are summarized in the table below.


(Dollars in thousands)	Fair Value Measurements Using						Total Fair Value
June 30, 2026	Level 1		Level 2		Level 3
Assets measured at fair value on a recurring basis
Securities available for sale
Mortgage-backed securities, residential	$	—	$	80,408	$	—	$	80,408
Asset-backed securities	—		743		—		743
State and municipal	—		2,588		—		2,588
CLO securities	—		183,183		—		183,183
Corporate bonds	—		260		—		260
SBA pooled securities	—		936		—		936
	$	—	$	268,118	$	—	$	268,118

Equity securities with readily determinable fair values
Mutual fund	$	4,540	$	—	$	—	$	4,540

Loans held for sale	$	—	$	1,405	$	—	$	1,405

Revenue share asset	$	—	$	—	$	1,349	$	1,349


(Dollars in thousands)	Fair Value Measurements Using						Total Fair Value
December 31, 2025	Level 1		Level 2		Level 3
Assets measured at fair value on a recurring basis
Securities available for sale
Mortgage-backed securities, residential	$	—	$	88,500	$	—	$	88,500
Asset-backed securities	—		811		—		811
State and municipal	—		2,589		—		2,589
CLO Securities	—		271,074		—		271,074
Corporate bonds	—		263		—		263
SBA pooled securities	—		1,040		—		1,040
	$	—	$	364,277	$	—	$	364,277

Equity securities with readily determinable fair values
Mutual fund	$	4,588	$	—	$	—	$	4,588

Loans held for sale	$	—	$	459	$	—	$	459

Revenue share asset	$	—	$	—	$	1,598	$	1,598

There were no transfers between levels during 2026 or 2025.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Revenue Share Asset

On June 30, 2022 and September 6, 2022, the Company entered into and closed two separate agreements to sell two separate portfolios of factored receivables. The June 30, 2022 agreement contains revenue share provisions that entitles the Company to an amount equal to fifteen percent of the future gross monthly revenue of the clients associated with the sold factored receivable portfolio. The September 6, 2022 agreement contains revenue share provisions that entitles the Company to an amount ranging from fifteen to twenty percent, depending on the client, of the future gross monthly revenue of the clients associated with the sold factored receivable portfolio. The fair value of the revenue share assets is calculated each reporting period, and changes in the fair value of the revenue share assets are recorded in noninterest income in the consolidated statements of income. The revenue share asset fair value is considered a Level 3 classification.

At June 30, 2026 and December 31, 2025, the estimated cash payments expected to be received from the purchaser for the Company's share of future gross monthly revenue was $1,911,000 and $2,256,000, respectively, and a discount rate of 10.0% was applied to calculate the present value of the revenue share asset. A reconciliation of the opening balance to the closing balance of the fair value of the revenue share asset is as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in thousands)	2026		2025		2026		2025
Beginning balance	$	1,448	$	2,507	$	1,598	$	2,616
Revenue share asset recognized	—		—		—		—
Change in fair value of revenue share asset recognized in earnings	(190)		101		(312)		274
Revenue share payments received	(168)		(264)		(196)		(546)
Other adjustments	259		—		259		—
Ending balance	$	1,349	$	2,344	$	1,349	$	2,344

Assets measured at fair value on a non-recurring basis are summarized in the table below. There were no liabilities measured at fair value on a non-recurring basis at June 30, 2026 and December 31, 2025.


(Dollars in thousands)	Fair Value Measurements Using						Total Fair Value
June 30, 2026	Level 1		Level 2		Level 3
Collateral dependent loans

1-4 family residential	$	—	$	—	$	56	$	56
Commercial	—		—		4,993		4,993
Factored receivables	—		—		4,956		4,956



	$	—	$	—	$	10,005	$	10,005


(Dollars in thousands)	Fair Value Measurements Using						Total Fair Value
December 31, 2025	Level 1		Level 2		Level 3
Collateral dependent loans


Commercial	$	—	$	—	$	5,515	$	5,515
Factored receivables	—		—		2,072		2,072




	$	—	$	—	$	7,587	$	7,587

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Collateral Dependent Loans Specific Allocation of ACL: A loan is considered to be a collateral dependent loan when, based on current information and events, the Company expects repayment of the financial assets to be provided substantially through the operation or sale of the collateral and the Company has determined that the borrower is experiencing financial difficulty as of the measurement date. The ACL is measured by estimating the fair value of the loan based on the present value of expected cash flows, the market price of the loan, or the underlying fair value of the loan’s collateral. For real estate loans, fair value of the loan’s collateral is determined by third party appraisals, which are then adjusted for the estimated selling and closing costs related to liquidation of the collateral. For this asset class, the actual valuation methods (income, sales comparable, or cost) vary based on the status of the project or property. For example, land is generally based on the sales comparable method while construction is based on the income and/or sales comparable methods. The unobservable inputs may vary depending on the individual assets with no one of the three methods being the predominant approach. The Company reviews the third party appraisal for appropriateness and adjusts the value downward to consider selling and closing costs, which typically range from 5% to 8% of the appraised value. For non-real estate loans, fair value of the loan’s collateral may be determined using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business.

The estimated fair values of the Company’s financial instruments not measured at fair value on a recurring or non-recurring basis at June 30, 2026 and December 31, 2025 were as follows:


(Dollars in thousands)	Carrying Amount		Fair Value Measurements Using						Total Fair Value
June 30, 2026			Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents	$	896,811	$	896,811	$	—	$	—	$	896,811
Securities - held to maturity	977		—		—		515		515
Loans not previously presented, gross	5,467,086		42,634		—		5,379,530		5,422,164
FHLB and other restricted stock	3,171		N/A		N/A		N/A		N/A
Accrued interest receivable	37,910		37,910		—		—		37,910

Financial liabilities:
Deposits	6,217,389		—		6,214,443		—		6,214,443

Subordinated notes	69,979		—		67,726		—		67,726
Junior subordinated debentures	43,321		—		44,383		—		44,383
Accrued interest payable	8,274		8,274		—		—		8,274


(Dollars in thousands)	Carrying Amount		Fair Value Measurements Using						Total Fair Value
December 31, 2025			Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents	$	248,471	$	248,471	$	—	$	—	$	248,471
Securities - held to maturity	1,550		—		—		1,878		1,878
Loans not previously presented, gross	4,983,720		31,254		—		4,903,148		4,934,402
FHLB and other restricted stock	14,253		N/A		N/A		N/A		N/A
Accrued interest receivable	46,254		46,254		—		—		46,254

Financial liabilities:
Deposits	4,950,216		—		4,948,300		—		4,948,300

Federal Home Loan Bank advances	280,000		—		280,000		—		280,000
Subordinated notes	69,879		—		65,581		—		65,581
Junior subordinated debentures	42,991		—		44,021		—		44,021
Accrued interest payable	14,890		14,890		—		—		14,890

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 10 — REGULATORY MATTERS

The Company (on a consolidated basis) and TBK Bank are subject to various regulatory capital requirements administered by federal and state banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s or TBK Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and TBK Bank must meet specific capital guidelines that involve quantitative measures of their 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.

Quantitative measures established by regulation to ensure capital adequacy require the Company and TBK Bank to maintain minimum amounts and ratios (set forth in the table below) of total, common equity Tier 1, and Tier 1 capital to risk weighted assets, and of Tier 1 capital to average assets. Management believes, as of June 30, 2026 and December 31, 2025, the Company and TBK Bank meet all capital adequacy requirements to which they are subject.

As of June 30, 2026 and December 31, 2025, TBK Bank’s capital ratios exceeded those levels necessary to be categorized as “well capitalized” under the regulatory framework for prompt corrective action. To be categorized as “well capitalized,” TBK Bank must maintain minimum total risk based, common equity Tier 1 risk based, Tier 1 risk based, and Tier 1 leverage ratios as set forth in the table below. There are no conditions or events since June 30, 2026 that management believes have changed TBK Bank’s category.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The actual capital amounts and ratios for the Company and TBK Bank are presented in the following table.


(Dollars in thousands)	Actual			Minimum for Capital Adequacy Purposes			To Be Well Capitalized Under Prompt Corrective Action Provisions
June 30, 2026	Amount		Ratio	Amount		Ratio	Amount		Ratio
Total capital (to risk weighted assets)
Triumph Financial, Inc.	$	739,086	12.3%	$	481,343	8.0%	N/A		N/A
TBK Bank, SSB	$	718,897	12.0%	$	480,912	8.0%	$	601,140	10.0%

Tier 1 capital (to risk weighted assets)
Triumph Financial, Inc.	$	629,987	10.5%	$	361,007	6.0%	N/A		N/A
TBK Bank, SSB	$	681,881	11.3%	$	360,684	6.0%	$	480,912	8.0%

Common equity Tier 1 capital (to risk weighted assets)
Triumph Financial, Inc.	$	541,666	9.0%	$	270,755	4.5%	N/A		N/A
TBK Bank, SSB	$	681,881	11.3%	$	270,513	4.5%	$	390,741	6.5%

Tier 1 capital (to average assets)
Triumph Financial, Inc.	$	629,987	9.2%	$	275,279	4.0%	N/A		N/A
TBK Bank, SSB	$	681,881	9.9%	$	275,132	4.0%	$	343,916	5.0%

December 31, 2025
Total capital (to risk weighted assets)
Triumph Financial, Inc.	$	709,842	12.7%	$	446,691	8.0%	N/A		N/A
TBK Bank, SSB	$	694,230	12.5%	$	445,538	8.0%	$	556,922	10.0%

Tier 1 capital (to risk weighted assets)
Triumph Financial, Inc.	$	599,481	10.7%	$	335,018	6.0%	N/A		N/A
TBK Bank, SSB	$	655,376	11.8%	$	334,153	6.0%	$	445,538	8.0%

Common equity Tier 1 capital (to risk weighted assets)
Triumph Financial, Inc.	$	511,490	9.2%	$	251,263	4.5%	N/A		N/A
TBK Bank, SSB	$	655,376	11.8%	$	250,615	4.5%	$	361,999	6.5%

Tier 1 capital (to average assets)
Triumph Financial, Inc.	$	599,481	9.9%	$	243,240	4.0%	N/A		N/A
TBK Bank, SSB	$	655,376	10.8%	$	243,123	4.0%	$	303,904	5.0%

Dividends paid by TBK Bank are limited to, without prior regulatory approval, current year earnings and earnings less dividends paid during the preceding two years.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The capital conservation buffer set forth by the Basel III regulatory capital framework was 2.5% at June 30, 2026 and December 31, 2025. The capital conservation buffer is designed to absorb losses during periods of economic stress and requires increased capital levels for the purpose of capital distributions and other payments. Failure to meet the full amount of the buffer will result in restrictions on the Company’s ability to make capital distributions, including dividend payments and stock repurchases, and to pay discretionary bonuses to executive officers. At June 30, 2026 and December 31, 2025, the Company’s and TBK Bank’s risk based capital exceeded the required capital conservation buffer.

NOTE 11 — STOCKHOLDERS' EQUITY

The following summarizes the capital structure of Triumph Financial, Inc.

Preferred Stock Series C


(Dollars in thousands, except per share amounts)	June 30, 2026			December 31, 2025
Shares authorized	51,750			51,750
Shares issued	45,000			45,000
Shares outstanding	45,000			45,000
Par value per share	$	0.01		$	0.01
Liquidation preference per share	$	1,000		$	1,000
Liquidation preference amount	$	45,000		$	45,000
Dividend rate	7.125		%	7.125		%
Dividend payment dates	Quarterly			Quarterly

Common Stock


(Dollars in thousands, except per share amounts)	June 30, 2026		December 31, 2025
Shares authorized	50,000,000		50,000,000
Shares issued	29,697,942		29,535,826
Treasury shares	(5,803,405)		(5,770,441)
Shares outstanding	23,894,537		23,765,385
Par value per share	$	0.01	$	0.01

NOTE 12 — STOCK BASED COMPENSATION

Stock based compensation expense that has been charged against income was $4,109,000 and $3,430,000 for the three months ended June 30, 2026 and 2025, respectively, and $7,527,000 and $6,261,000 for the six months ended June 30, 2026 and 2025, respectively.

2014 Omnibus Incentive Plan

The Company’s 2014 Omnibus Incentive Plan (“Omnibus Incentive Plan”) provides for the grant of nonqualified and incentive stock options, stock appreciation rights, restricted stock awards, restricted stock units, and other awards that may be settled in, or based upon the value of, the Company’s common stock. The maximum number of shares of common stock available for issuance under the Omnibus Incentive Plan is 3,650,000 shares.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Restricted Stock Units

A summary of changes in the Company’s nonvested Restricted Stock Units (“RSUs”) under the Omnibus Incentive Plan for the six months ended June 30, 2026 were as follows:


Nonvested RSUs	Shares	Weighted-Average Grant-Date Fair Value
Nonvested at January 1, 2026	198,757	$	59.96
Granted	77,974	67.55
Vested	(73,702)	63.63
Forfeited	(3,010)	63.50
Nonvested at June 30, 2026	200,019	$	61.51

RSUs granted to employees under the Omnibus Incentive Plan typically vest over one to four years. Compensation expense for the RSUs will be recognized over the vesting period of the awards based on the fair value of the stock at the issue date. As of June 30, 2026, there was $7,564,000 of unrecognized compensation cost related to the nonvested RSUs. The cost is expected to be recognized over a remaining period of 2.80 years.

Market Based Performance Stock Units

A summary of changes in the Company’s nonvested Market Based Performance Stock Units (“Market Based PSUs”) under the Omnibus Incentive Plan for the six months ended June 30, 2026 were as follows:


Nonvested Market Based PSUs	Shares	Weighted-Average Grant-Date Fair Value
Nonvested at January 1, 2026	245,423	$	93.82
Granted	90,689	121.27
Performance adjustment	(22,452)	—
Vested	(49,855)	81.95
Forfeited	(2,903)	103.09
Nonvested at June 30, 2026	260,902	$	107.60

Market Based PSUs granted to employees under the Omnibus Incentive Plan vest after three years. The number of shares issued upon vesting will range from 0% to 175% of the Market Based PSUs granted based on the Company’s relative total shareholder return (“TSR”) as compared to the TSR of specified groups of peer companies, and with respect to the Company's awards granted during and after 2023, may include an additional multiplier of up to 200% of the otherwise earned award based on the Company's absolute TSR. Compensation expense for the Market Based PSUs will be recognized over the vesting period of the awards based on the fair value of the award at the grant date. The fair value of Market Based PSUs granted is estimated using a Monte Carlo simulation. Expected volatilities were determined based on the historical volatilities of the Company and the specified peer group. The risk-free interest rate for the performance period was derived from the Treasury constant maturities yield curve on the valuation dates.

The fair value of the Market Based PSUs granted was determined using the following weighted-average assumptions:


	Six Months Ended June 30,
	2026			2025
Grant date	May 1, 2026			May 1, 2025
Performance period	3.00 years			3.00 years
Stock price	$	67.55		$	54.38
Triumph Financial stock price volatility	42.48		%	42.22		%
Risk-free rate	3.84		%	3.62		%

As of June 30, 2026, there was $18,559,000 of unrecognized compensation cost related to the nonvested Market Based PSUs. The cost is expected to be recognized over a remaining period of 2.30 years.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Stock Options

A summary of the changes in the Company’s stock options under the Omnibus Incentive Plan for the six months ended June 30, 2026 were as follows:


Stock Options	Shares	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (In Years)	Aggregate Intrinsic Value (In Thousands)
Outstanding at January 1, 2026	328,197	$	50.73
Granted	68,894	67.55
Exercised	(24,076)	15.87
Forfeited	—	—
Expired	—	—
Outstanding at June 30, 2026	373,015	$	56.08	6.82	$	7,754

Fully vested shares and shares expected to vest at June 30, 2026	373,015	$	56.08	6.82	$	7,754

Shares exercisable at June 30, 2026	202,644	$	51.46	5.00	$	5,245

Information related to the stock options for the six months ended June 30, 2026 and 2025 was as follows:


	Six Months Ended June 30,
(Dollars in thousands, except per share amounts)	2026		2025
Aggregate intrinsic value of options exercised	$	998	$	14
Cash received from option exercises, net	(211)		25
Tax benefit realized from option exercises	210		3
Weighted average fair value per share of options granted	$	36.42	$	28.35

Stock options awarded to employees under the Omnibus Incentive Plan are generally granted with an exercise price equal to the market price of the Company’s common stock at the date of grant, vest over four years, and have ten year contractual terms. The fair value of stock options granted is estimated at the date of grant using the Black-Scholes option-pricing model. Expected volatilities are determined based on the Company’s historical volatility. The expected term of the options granted is determined based on the SEC simplified method, which calculates the expected term as the mid-point between the weighted average time to vesting and the contractual term. The risk-free interest rate for the expected term of the options is derived from the Treasury constant maturity yield curve on the valuation date.

The fair value of the stock options granted was determined using the following weighted-average assumptions:


	Six Months Ended June 30,
	2026		2025
Risk-free interest rate	4.07	%	3.88	%
Expected term	6.25 years		6.25 years
Expected stock price volatility	50.55	%	48.48	%
Dividend yield	—		—

As of June 30, 2026, there was $3,549,000 of unrecognized compensation cost related to nonvested stock options granted under the Omnibus Incentive Plan. The cost is expected to be recognized over a remaining period of 3.11 years.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Employee Stock Purchase Plan

During the year ended December 31, 2019, the Company’s Board of Directors adopted, and the Company’s stockholders approved, the Company's 2019 Employee Stock Purchase Plan (“ESPP”). Under the ESPP, 2,500,000 shares of common stock were reserved for issuance. The ESPP enables eligible employees to purchase the Company’s common stock at a price per share equal to 85% of the lower of the fair market value of the common stock at the beginning or end of each six month offering period. During the six months ended June 30, 2026 and 2025, 24,926 shares and 20,892 shares, respectively, were issued under the plan.

NOTE 13 — EARNINGS PER SHARE

The factors used in the earnings per share computation follow:


	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in thousands)	2026		2025		2026		2025
Basic
Net income (loss) to common stockholders	$	10,568	$	3,618	$	16,122	$	2,834
Weighted average common shares outstanding	23,865,432		23,590,119		23,826,458		23,476,888
Basic earnings (loss) per common share	$	0.44	$	0.15	$	0.68	$	0.12
Diluted
Net income (loss) to common stockholders	$	10,568	$	3,618	$	16,122	$	2,834
Weighted average common shares outstanding	23,865,432		23,590,119		23,826,458		23,476,888
Dilutive effects of:
Assumed exercises of stock options	55,497		54,952		58,523		67,878
Restricted stock awards	—		16,097		—		30,785
Restricted stock units	101,847		89,156		113,023		124,984
Performance stock units - market based	122,961		17,704		124,493		23,171
Employee stock purchase program	2,772		4,627		1,518		4,299
Average shares and dilutive potential common shares	24,148,509		23,772,655		24,124,015		23,728,005
Diluted earnings (loss) per common share	$	0.44	$	0.15	$	0.67	$	0.12

Shares that were not considered in computing diluted earnings per common share because they were antidilutive are as follows:


	Three Months Ended June 30,		Six Months Ended June 30,
	2026	2025	2026	2025
Stock options	131,024	199,859	190,410	122,151

Restricted stock units	—	5,171	—	3,750
Performance stock units - market based	88,187	56,311	44,337	28,313

NOTE 14 — REVENUE FROM CONTRACTS WITH CUSTOMERS

The Company records revenue from contracts with customers in accordance with Accounting Standards Codification Topic 606, “Revenue from Contracts with Customers” (“Topic 606”). Under Topic 606, the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. The Company generally fully satisfies its performance obligations on its contracts with customers as services are rendered and the transaction prices can be fixed or variable; charged either on a periodic basis or based on activity. Except as disclosed below, the Company presents disaggregated revenue from contracts with customers in the consolidated statements of income.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Banking and Factoring Segments

The Banking segment derives its revenue principally from investments in interest-earning assets as well as noninterest income typical for the banking industry, and the Factoring segment derives the large majority of its revenue from interest income on purchased factored receivables. The majority of such revenue streams fall under Accounting Standards Codification Topic 310, “Receivables” (“Topic 310”) which is outside the scope of Topic 606. There are, however, certain Banking and Factoring activities that generate revenue under Topic 606. Descriptions of the Company's significant Banking and Factoring revenue-generating activities within the scope of Topic 606, which are included in non-interest income in the Company's consolidated statements of income, are as follows:

•Service charges on deposits. Service charges on deposits primarily consists of fees from the Company's deposit customers for account maintenance, account analysis, and overdraft services. Account maintenance fees and analysis fees are earned over the course of a month, representing the period over which the Company satisfies the performance obligation. Overdraft fees are recognized at the point in time that the overdraft occurs.

•Card income. Card income primarily consists of interchange fees. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized when the transaction processing services are provided to the cardholder.

•Net OREO gains (losses) and valuation adjustments. The Company records a gain or loss from the sale of OREO when control of the property transfers to the buyer, which generally occurs at the time of an executed deed. When the Company finances the sale of OREO to the buyer, the Company assesses whether the buyer is committed to perform their obligations under the contract and whether collectability of the transaction price is probable. Once these criteria are met, the OREO asset is derecognized and the gain or loss on sale is recorded upon the transfer of control of the property to the buyer.

•Fee income. Fee income for the Banking and Factoring segments primarily consists of transaction-based fees, including wire transfer fees, ACH and check fees, early termination fees, and other fees, earned from the Company's banking and factoring customers. Transaction based fees are recognized at the time the transaction is executed as that is the point in time the Company satisfies its performance obligations.

•Insurance commissions. Insurance commissions are earned for brokering insurance policies and providing administrative services to the Company's customers, over-the-road Carriers, over the one year life of the insurance policies. Because the administrative services are integral to the brokerage relationship, the brokering and servicing are considered one performance obligation and no allocation of the commission transaction price is required. The commissions are recognized over the one-year policy term.

Payments Segment

The Payments segment derives a portion of its revenue from interest income on factored receivables and commercial loans related to invoice payments. These factored receivables consist of (i) invoices where we offer a Carrier a QuickPay opportunity to receive payment at a discount in advance of the standard payment term for such invoice in exchange for the assignment of such invoice to us and (ii) factoring transactions where we purchase receivables payable to such freight brokers from their shipper clients. The Payments segment also offers commercial loans that result from our offering certain Brokers an additional liquidity option through the ability to settle their invoices with us on an extended term following our payment to their Carriers. There were no such commercial loans at June 30, 2026 and December 31, 2025. Such revenue falls under Topic 310 and is outside the scope of Topic 606.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The products and services offered through the Company's Payments segment connect Brokers, Shippers, Factors and Carriers through forward-thinking solutions that help each party successfully manage the life cycle of invoice presentment for services provided by Carrier through processing and audit of such invoice to its ultimate payment to the Carrier or the Factor. The Payments segment earns transaction revenue for such services from fees paid by its customers to receive auditing and payment processing of their invoices. Transaction revenue is recorded in Fee Income on the Consolidated Statements of Income and is subject to Topic 606. Transaction fees can be variable in nature. When such fees are variable, they are typically based upon the number of audit and payment transactions executed during a stated period; generally a calendar month. The customer is charged either a set fee per transaction or a set minimum fee for a stated number of transactions with the variable component being a per-invoice amount for transactions exceeding the stated minimum number. When applicable, the stated minimum number of transactions typically resets on a monthly basis. Transaction volume and related variable fees are known and recognized at each reporting period. Transaction fees can also be fixed in nature with such fees reflecting a set annual amount that is recognized ratably over the terms of the related contracts. In both variable and fixed arrangements, customers are typically billed monthly in arrears with payment due on 30 day terms and as such, no revenue is deferred.

Our LoadPay product, a digital banking platform developed for Carriers, is housed within our Payments segment. LoadPay provides a user experience and financial products, including small business transactional accounts, tailored to the financial needs of the small trucking companies that are the ultimate payees inside of the payments network. A key feature of the LoadPay product is our ability to rapidly fund invoices approved for payment through the payments network or approved for purchase as part of our factoring operations to the LoadPay account without the need for such payments to be processed through traditional payment rails such as ACH transfers.

LoadPay transaction revenue is recognized on interchange fees and instant transfer fees. The Carrier’s LoadPay bank account funds are deposited in a TBK noninterest bearing transactional account. The Carrier has the option to spend the funds directly from the transactional account via a TBK debit card which results in interchange fees (consistently recognized in accordance with the Card income discussion under the Banking segment). Additionally, the Carrier has the ability to transfer its LoadPay transactional account funds to another financial institution. In lieu of an ACH transfer for which the funds will take 2-3 days to be made available in the Carrier’s third party account, the Carrier can elect an instant transfer where the funds will be made available immediately for a fee retained by TBK. Instant transfer fees are within the scope of Topic 606. Instant transfer fees are variable in nature. They are based upon the number of instant transfer transactions executed during a given day. The customer is charged a set fee per transaction that scales up based on the size of the transaction. Instant transfer fees are typically collected directly prior to transfer of the funds and as such, no revenue is deferred.

The Payments segment's service comprises a single performance obligation to provide stand-ready access to its payments and audit platforms for its customers which is satisfied over time as services are rendered. Given the nature of its services and related revenue, no significant judgments are made in applying Topic 606 and there are no refund, warranty, or similar obligations.

The Payments segment's contracts with its customers are usually short-term in nature and can generally be terminated by either party without a termination penalty or refund after the notice period has lapsed. Therefore, the contracts are defined at the transaction level and do not extend beyond the service already provided. The contracts generally renew automatically without any significant material rights. Some of the contracts include tiered pricing, which is based primarily on volume. The fee charged per transaction is adjusted up or down based on the volume processed for a specified period. Management has concluded that this volume-based pricing approach does not constitute a future material right since changes in the fee ranges are typically offered to classes of customers with similar volume.

The Payments segment recognizes fees charged to its customers on a gross basis as transaction revenue as it is the principal in respect of completing Payments segment transactions. As a principal to the transaction, the Payments segment controls the services on its platforms. The Payments segment bears primary responsibility for the fulfillment of the services, contracts directly with its customers, controls the product specifications, and defines the value proposal from its services. Further, the Payments segment has full discretion in determining the fee charged to its customers. The Payments segment is also responsible for providing customer support.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Capitalized contract costs consist of (i) deferred sales commissions that are incremental costs of obtaining customer contracts and (ii) deferred set-up costs, primarily direct payroll costs, for implementation services provided to customers prior to the launching of the Company’s products for general availability (go-live) to customers. Deferred sales commissions are amortized ratably over two years, taking into consideration the initial contract term, expected renewal periods, and sales commissions paid on such renewal periods. Deferred set-up costs are amortized ratably over four years which estimates the benefit period of the capitalized costs starting on the go-live date of the service. Deferred sales commissions and deferred set-up costs were included in other assets in the accompanying consolidated balance sheets and were $138,000 and $2,068,000, respectively, at June 30, 2026 and $220,000 and $1,840,000, respectively, at December 31, 2025. The table below shows the amortization of deferred sales commissions and deferred set-up costs, which is included in salaries and employee benefits in the consolidated statements of income:


	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in thousands)	2026		2025		2026		2025
Amortization of deferred sales commissions	$	101	$	159	$	215	$	290
Amortization of deferred set up costs	189		125		360		233
Total amortization of deferred costs	$	290	$	284	$	575	$	523

Given the nature of services provided, the Payments segment does not carry any material contract balances.

The table below shows the Payments segment’s revenue from transaction and network fees from external customers, which are disaggregated by customer category.


	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in thousands)	2026		2025		2026		2025
Broker fee income	$	9,536	$	6,443	$	17,356	$	11,621
Factor fee income	630		993		1,426		2,226
Other fee income	551		150		1,009		257
Total fee income	$	10,717	$	7,586	$	19,791	$	14,104

Intelligence Segment

The services offered through the Company's Intelligence segment drive efficiency, enhance decision-making, and enable Shippers, Brokers, and Carriers to operate more profitably in a very competitive over-the-road trucking market. With Triumph’s access to data from its Intelligence network and other sources, management believes that Triumph can develop products and services to offer to logistics service providers, allowing them to better plan for peak periods, competitively source freight capacity, and allocate resources efficiently, thus improving their profitability.

The Intelligence segment earns subscription revenue for such services from fees paid by its customers to receive access to the Intelligence platform via a software as a service agreement. Subscription revenue is recorded in Fee Income on the Consolidated Statements of Income and is subject to Topic 606. The customer is charged a monthly fixed subscription fee that is typically billed in arrears with payment due on 30 day terms and as such, no revenue is deferred.

The Intelligence segment's service comprises a single performance obligation to provide stand-ready access to its Intelligence platform for its customers which is satisfied over time as services are rendered. Given the nature of its services and related revenue, no significant judgments are made in applying Topic 606 and there are no refund, warranty, or similar obligations other than standard constrained service level agreements.

The Intelligence segment's contracts with its customers are usually one or two years in nature and can generally be terminated by either party without a termination penalty or refund if either party gives the other party written notice of non-renewal at least 30 days prior to the expiration of the then-current term. Unless notice is given, the contracts generally renew automatically without any significant material rights. Some of the contracts include tiered pricing, where subscription fees will increase based primarily on an increase in customer revenue; however, such tiered pricing is dependent on customer performance and is constrained until known for revenue recognition purposes. Management has concluded that this tiered pricing approach does not constitute a future material right since changes in the fee ranges are typically offered to classes of customers with similar volume.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The Intelligence segment recognizes fees charged to its customers on a gross basis as subscription revenue as it is the principal in respect of completing Intelligence segment transactions. As a principal to the transaction, the Intelligence segment controls the services on its platforms. The Intelligence segment bears primary responsibility for the fulfillment of the services, contracts directly with its customers, controls the product specifications, and defines the value proposal from its services. Further, the Intelligence segment has full discretion in determining the fee charged to its customers. The Intelligence segment is also responsible for providing customer support.

Capitalized contract costs consist of (i) deferred sales commissions that are incremental costs of obtaining customer contracts and (ii) deferred set-up costs, primarily direct payroll costs, for implementation services provided to customers prior to the launching of the Company’s products for general availability (go-live) to customers. Deferred sales commissions are amortized ratably over two years, taking into consideration the initial contract term, expected renewal periods, and sales commissions paid on such renewal periods. Deferred set-up costs are amortized ratably over four years which estimates the benefit period of the capitalized costs starting on the go-live date of the service. Deferred sales commissions and deferred set-up costs were included in other assets in the accompanying consolidated balance sheets and were not significant at June 30, 2026 and December 31, 2025. The amortization of deferred sales commissions and deferred set-up costs is included in salaries and employee benefits in the consolidated statements of income and was not significant for the six months ended June 30, 2026 and 2025.

Given the nature of services provided, the Intelligence segment does not carry any material contract balances.

NOTE 15 — LESSOR OPERATING LEASES

On March 20, 2024, the Company purchased a building in Dallas, TX that was intended to be the future headquarters for Triumph Financial. On December 17, 2025, the Company sold the building and will not occupy it in any capacity. During the year ended December 31, 2025, the Company leased space in the building to tenants under operating leases. The table below shows the Company's revenue from these operating leases, which is included in non-interest income in the Company's consolidated statements of income.


	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars in thousands)	2026		2025		2026		2025
Fixed payments	$	—	$	133	$	—	$	682
Variable payments	—		142		—		436
Amortization of intangibles included in lease income	—		(19)		—		$	(38)
Total lease income	$	—	$	256	$	—	$	1,080

NOTE 16 — BUSINESS SEGMENT INFORMATION

The Company's reportable segments are Banking, Factoring, Payments, and Intelligence, which have been determined based upon their business processes and economic characteristics. This determination also gave consideration to the structure and management of various product lines.

The Banking segment includes the operations of TBK Bank. The Banking segment derives its revenue principally from investments in interest earning assets as well as noninterest income typical for the banking industry.

The Factoring segment derives its revenue from factoring services.

The Payments segment includes the presentment, audit, and payment solutions offered to Shipper, Broker, and Factor clients in the trucking industry. The Payments segment derives its revenue from transaction fees and interest income on factored receivables related to invoice payments. These factored receivables consist of (i) invoices where we offer a carrier a quickpay opportunity to receive payment at a discount in advance of the standard payment term for such invoice in exchange for the assignment of such invoice to us, (ii) offering freight brokers the ability to settle their invoices with us on an extended term following our payment to their carriers as an additional liquidity option for such freight brokers, and (iii) factoring transactions where we purchase receivables payable to such freight brokers from their shipper clients. The Payments segment also offer the LoadPay product; a digital banking platform developed for Carriers.

Table of Contents

TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The Intelligence segment was launched at the beginning of the fourth quarter of 2024 to turn the over-the-road trucking data collected through our services into actionable insights for our customers. This launch coincided with our acquisition of the assets of Isometric Technologies Inc. that provides service and performance scoring and benchmarking capabilities to the over-the-road trucking industry. The operations of this segment were further supplemented with our acquisition of Greenscreens AI. Inc., a pricing solution for the logistics industry that delivers short-term freight market pricing intelligence and business insights, during the quarter ended June 30, 2025. Intelligence offerings enable better decision making, market intelligence and automation. The revenue for Intelligence offerings is derived through access and subscription fees, as well as seat licenses where applicable.

The Corporate and Other category consists of other business activities that do not represent a reportable segment.

Expenses that are directly attributable to the Company's Banking, Factoring, Payments, and Intelligence segments such as, but not limited to, occupancy, salaries and benefits to employees that are fully dedicated to the segment, and certain technology costs that can be attributed to specific users or functional areas within the segment are allocated as such. The Company continues to make considerable investments in shared services that benefit the entire organization and these expenses are allocated to the Corporate and Other category. The Company allocates such expenses to the Corporate and Other category in order for the Company's chief operating decision maker and investors to have clear visibility into the operating performance of each reportable segment.

Intersegment interest expense is allocated to the Factoring and Payments segments based on one-month term SOFR for their funding needs. When the Payments segment is self-funded, with customer deposit funding in excess of its factored receivables, intersegment interest income is allocated based on the Federal Funds effective rate. Management believes that such intersegment interest allocations appropriately reflect the current interest rate environment and the relatively quick turn of the underlying receivables.

Reported segments and the financial information of the reported segments are not necessarily comparable with similar information reported by other financial institutions. Additionally, because of the interrelationships of the various segments, the information presented is not indicative of how the segments would perform if they operated as independent entities. Changes in management structure or allocation methodologies and procedures may result in future changes to previously reported segment financial data. The accounting policies of the segments are substantially the same as those described in the “Summary of Significant Accounting Policies” in Note 1 of the Company’s 2025 Form 10-K.

Transactions between segments consist primarily of borrowed funds, payment network fees, and servicing fees. Intersegment interest expense is allocated to the Factoring and Payments segments as described above. Payment network fees are paid by the Factoring segment to the Payments segment for use of the payments network. Servicing fees are paid by the Payments segment to the Factoring segment for servicing factoring transactions with freight broker clients transferred from the Factoring segment to the Payments segment to align with the supply chain finance product offerings for this business. Servicing fees are paid by the Payments segment to the Factoring segment for servicing such product. The Factoring and Payments segments pay fees to our Banking segment for the Banking segment's execution of various banking services that benefit those segments. Credit loss expense is allocated based on the segment’s ACL determination. Noninterest income and expense directly attributable to a segment are assigned to the related segment. Various shared service costs such as human resources, accounting, finance, risk management and information technology expense are assigned to the Corporate and Other category if they are not directly attributable to a segment. Other segment expense consists of various loan and card related expenses and other insignificant miscellaneous costs not specifically reviewed by the Company's chief operating decision maker. Taxes are paid on a consolidated basis and are not allocated for segment purposes.

Table of Contents

TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


(Dollars in thousands)									Total		Corporate
Three Months Ended June 30, 2026	Banking		Factoring		Payments		Intelligence		Segments		and Other(1)		Consolidated
Total interest income	$	65,381	$	50,166	$	8,957	$	—	$	124,504	$	33	$	124,537
Intersegment interest allocations	8,405		(10,585)		2,180		—		—		—		—
Total interest expense	24,076		7		—		—		24,083		1,628		25,711
Net interest income (expense)	49,710		39,574		11,137		—		100,421		(1,595)		98,826
Credit loss expense (benefit)	(30)		2,716		155		—		2,841		(105)		2,736
Net interest income after credit loss expense	49,740		36,858		10,982		—		97,580		(1,490)		96,090
Noninterest income	5,331		1,917		10,893		2,389		20,530		885		21,415
Noninterest expense:
Salaries and employee benefits	14,684		12,452		9,771		3,449		40,356		19,731		60,087
Depreciation	1,540		273		156		18		1,987		776		2,763
Other occupancy, furniture and equipment	2,128		463		163		13		2,767		834		3,601
FDIC insurance and other regulatory assessments	1,167		—		—		—		1,167		—		1,167
Professional fees	4,356		436		300		112		5,204		1,885		7,089
Amortization of intangible assets	269		111		812		1,283		2,475		11		2,486
Advertising and promotion	317		383		333		24		1,057		348		1,405
Communications and technology	3,405		2,459		3,106		358		9,328		2,622		11,950
Software amortization	—		1,117		1,932		77		3,126		351		3,477
Travel and entertainment	210		156		219		115		700		508		1,208
Other	2,912		567		1,583		269		5,331		1,070		6,401
Total noninterest expense	30,988		18,417		18,375		5,718		73,498		28,136		101,634
Net intersegment noninterest income (expense)(2)	144		518		(662)		—		—		—		—
Net income (loss) before income tax expense	$	24,227	$	20,876	$	2,838	$	(3,329)	$	44,612	$	(28,741)	$	15,871

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


(Dollars in thousands)									Total		Corporate
Three Months Ended June 30, 2025	Banking		Factoring		Payments		Intelligence		Segments		and Other(1)		Consolidated
Total interest income	$	64,851	$	38,040	$	6,230	$	—	$	109,121	$	80	$	109,201
Intersegment interest allocations	6,386		(9,282)		2,896		—		—		—		—
Total interest expense	18,825		2		—		—		18,827		1,696		20,523
Net interest income (expense)	52,412		28,756		9,126		—		90,294		(1,616)		88,678
Credit loss expense (benefit)	2,219		(2,916)		92		—		(605)		(97)		(702)
Net interest income after credit loss expense	50,193		31,672		9,034		—		90,899		(1,519)		89,380
Noninterest income	7,989		1,811		7,724		1,724		19,248		136		19,384
Noninterest expense:
Salaries and employee benefits	16,001		13,444		8,711		3,234		41,390		18,492		59,882
Depreciation	1,656		468		222		7		2,353		1,602		3,955
Other occupancy, furniture and equipment	1,896		508		163		14		2,581		1,603		4,184
FDIC insurance and other regulatory assessments	894		—		—		—		894		—		894
Professional fees	1,801		(7,272)		240		2,995		(2,236)		1,916		(320)
Amortization of intangible assets	385		193		1,418		946		2,942		458		3,400
Advertising and promotion	557		223		669		22		1,471		367		1,838
Communications and technology	5,257		2,438		2,455		278		10,428		1,887		12,315
Software amortization	—		1,125		1,413		—		2,538		327		2,865
Travel and entertainment	306		245		456		130		1,137		482		1,619
Other	3,210		2,770		1,097		84		7,161		3,047		10,208
Total noninterest expense	31,963		14,142		16,844		7,710		70,659		30,181		100,840
Net intersegment noninterest income (expense)(2)	155		413		(568)		—		—		—		—
Net income (loss) before income tax expense	$	26,374	$	19,754	$	(654)	$	(5,986)	$	39,488	$	(31,564)	$	7,924

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


(Dollars in thousands)									Total		Corporate
Six Months Ended June 30, 2026	Banking		Factoring		Payments		Intelligence		Segments		and Other(1)		Consolidated
Total interest income	$	121,992	$	89,110	$	16,123	$	—	$	227,225	$	67	$	227,292
Intersegment interest allocations	14,136		(18,804)		4,668		—		—		—		—
Total interest expense	39,115		13		—		—		39,128		3,244		42,372
Net interest income (expense)	97,013		70,293		20,791		—		188,097		(3,177)		184,920
Credit loss expense (benefit)	(2,368)		3,773		352		—		1,757		372		2,129
Net interest income after credit loss expense	99,381		66,520		20,439		—		186,340		(3,549)		182,791
Noninterest income	11,489		3,835		20,056		4,786		40,166		956		41,122
Noninterest expense:
Salaries and employee benefits	29,658		24,293		18,545		6,666		79,162		39,093		118,255
Depreciation	3,117		561		332		34		4,044		1,602		5,646
Other occupancy, furniture and equipment	4,144		959		304		40		5,447		1,772		7,219
FDIC insurance and other regulatory assessments	2,225		—		—		—		2,225		—		2,225
Professional fees	6,680		713		534		241		8,168		3,684		11,852
Amortization of intangible assets	538		248		1,629		2,566		4,981		21		5,002
Advertising and promotion	671		644		529		118		1,962		655		2,617
Communications and technology	8,502		4,779		5,942		717		19,940		5,129		25,069
Software amortization	—		2,187		3,753		135		6,075		702		6,777
Travel and entertainment	439		386		512		261		1,598		1,130		2,728
Other	6,356		1,237		2,399		340		10,332		2,173		12,505
Total noninterest expense	62,330		36,007		34,479		11,118		143,934		55,961		199,895
Net intersegment noninterest income (expense)(2)	269		1,033		(1,302)		—		—		—		—
Net income (loss) before income tax expense	$	48,809	$	35,381	$	4,714	$	(6,332)	$	82,572	$	(58,554)	$	24,018

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


(Dollars in thousands)									Total		Corporate
Six Months Ended June 30, 2025	Banking		Factoring		Payments		Intelligence		Segments		and Other(1)		Consolidated
Total interest income	$	128,344	$	71,371	$	11,593	$	—	$	211,308	$	163	$	211,471
Intersegment interest allocations	11,121		(16,935)		5,814		—		—		—		—
Total interest expense	35,036		2		—		—		35,038		3,372		38,410
Net interest income (expense)	104,429		54,434		17,407		—		176,270		(3,209)		173,061
Credit loss expense (benefit)	2,726		(2,356)		210		—		580		48		628
Net interest income after credit loss expense	101,703		56,790		17,197		—		175,690		(3,257)		172,433
Noninterest income	14,992		3,530		14,255		2,119		34,896		1,678		36,574
Noninterest expense:
Salaries and employee benefits	32,318		26,666		18,324		4,718		82,026		36,574		118,600
Depreciation	3,286		971		452		14		4,723		3,176		7,899
Other occupancy, furniture and equipment	3,998		1,045		331		21		5,395		3,287		8,682
FDIC insurance and other regulatory assessments	1,621		—		—		—		1,621		—		1,621
Professional fees	2,866		(5,420)		446		3,946		1,838		3,906		5,744
Amortization of intangible assets	770		386		2,969		1,062		5,187		613		5,800
Advertising and promotion	1,068		477		1,050		52		2,647		655		3,302
Communications and technology	10,272		4,712		4,924		505		20,413		4,146		24,559
Software amortization	56		1,719		2,609		2		4,386		471		4,857
Travel and entertainment	544		428		833		248		2,053		1,058		3,111
Other	6,235		3,511		2,019		150		11,915		4,923		16,838
Total noninterest expense	63,034		34,495		33,957		10,718		142,204		58,809		201,013
Net intersegment noninterest income (expense)(2)	292		848		(1,140)		—		—		—		—
Net income (loss) before income tax expense	$	53,953	$	26,673	$	(3,645)	$	(8,599)	$	68,382	$	(60,388)	$	7,994

(1) Includes revenue and expense from the Company’s holding company, which does not meet the definition of an operating segment. Also includes corporate shared service costs such as the majority of salaries and benefits expense for the Company's executive leadership team, as well as other selling, general, and administrative shared services costs including human resources, accounting, finance, risk management and a significant amount of information technology expense.

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TRIUMPH FINANCIAL, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(2) Net intersegment noninterest income (expense) includes:


(Dollars in thousands)	Banking		Factoring		Payments
Three Months Ended June 30, 2026
Factoring revenue received from Payments	$	—	$	910	$	(910)
Payments revenue received from Factoring	—		(266)		266
Banking revenue received from Payments and Factoring	144		(126)		(18)
Net intersegment noninterest income (expense)	$	144	$	518	$	(662)

Three Months Ended June 30, 2025
Factoring revenue received from Payments	$	—	$	910	$	(910)
Payments revenue received from Factoring	—		(381)		381
Banking revenue received from Payments and Factoring	155		(116)		(39)
Net intersegment noninterest income (expense)	$	155	$	413	$	(568)

Six months ended June 30, 2026
Factoring revenue received from Payments	$	—	$	1,821	$	(1,821)
Payments revenue received from Factoring	—		(553)		553
Banking revenue received from Payments and Factoring	269		(235)		(34)
Net intersegment noninterest income (expense)	$	269	$	1,033	$	(1,302)

Six months ended June 30, 2025
Factoring revenue received from Payments	$	—	$	1,821	$	(1,821)
Payments revenue received from Factoring	—		(753)		753
Banking revenue received from Payments and Factoring	292		(220)		(72)
Net intersegment noninterest income (expense)	$	292	$	848	$	(1,140)


(Dollars in thousands)									Total		Corporate
June 30, 2026	Banking		Factoring		Payments		Intelligence		Segments		and Other		Eliminations		Consolidated
Total assets	$	4,820,467	$	1,821,671	$	838,251	$	111,973	$	7,592,362	$	1,123,430	$	(1,312,107)	$	7,403,685
Gross loans	$	3,337,212	$	1,752,492	$	387,387	$	—	$	5,477,091	$	—	$	—	$	5,477,091


(Dollars in thousands)									Total		Corporate
December 31, 2025	Banking		Factoring		Payments		Intelligence		Segments		and Other		Eliminations		Consolidated
Total assets	$	4,480,124	$	1,335,150	$	774,979	$	120,410	$	6,710,663	$	1,088,885	$	(1,418,960)	$	6,380,588
Gross loans	$	3,525,447	$	1,223,740	$	242,120	$	—	$	4,991,307	$	—	$	—	$	4,991,307

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ITEM 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This section presents management’s perspective on our financial condition and results of operations. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the Company’s interim consolidated financial statements and the accompanying notes included elsewhere in this Quarterly Report on Form 10-Q and with the consolidated financial statements and accompanying notes and other detailed information appearing in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. To the extent that this discussion describes prior performance, the descriptions relate only to the periods listed, which may not be indicative of our future financial outcomes. In addition to historical information, this discussion contains forward-looking statements that involve risks, uncertainties and assumptions that could cause results to differ materially from management’s expectations. See the “Forward-Looking Statements” section of this discussion for further information on forward-looking statements.

Overview

We are a financial holding company headquartered in Dallas, Texas and registered under the Bank Holding Company Act, that offers a diversified line of banking, factoring, payments, and intelligence services. Our principal subsidiary is TBK Bank, SSB, a Texas state savings bank and the entity through which we offer substantially all of our products and services. Effective January, 1, 2025, we merged Triumph Financial Services LLC, the entity through which we previously conducted all of our factoring operations, with and into TBK Bank, SSB. As of June 30, 2026, we had consolidated total assets of $7.404 billion, total loans held for investment of $5.477 billion, total deposits of $6.217 billion and total stockholders’ equity of $963.3 million.

We offer traditional banking services, commercial lending product lines focused on businesses that require specialized financial solutions and national lending product lines that further diversify our lending operations. Our banking operations commenced in 2010 and include a branch network developed through organic growth and acquisition, including concentrations the front range of Colorado, the Quad Cities market in Iowa and Illinois and two full-service branches in Dallas, Texas. Our traditional banking offerings include a full suite of lending and deposit products and services. These activities are focused on our local market areas and some products are offered on a nationwide basis. They generate a stable source of core deposits and a diverse asset base to support our overall operations. Additionally, we offer equipment lending and mortgage warehouse lending on a nationwide basis to provide further asset base diversification and our mortgage warehouse lending generates stable deposits. Our Banking products and services share basic processes and have similar economic characteristics.

In addition to our traditional banking operations, we also operate a factoring business focused primarily on serving the over-the-road trucking industry. This business involves the provision of working capital to the trucking industry through the purchase of invoices generated by small to medium sized trucking fleets ("Carriers") at a discount to provide immediate working capital to such Carriers. In 2024, our factoring business also launched its Factoring as a Service ("FaaS") product. As part of our FaaS product, we offer certain back-office or white-labeled factoring services to the over-the-road transportation industry, enabling our FaaS customers to either supplement their own factoring operations or to offer factoring services to their customers wholly supported by our platform. Our factoring business operates in a highly specialized niche with unique processes and earns substantially higher yields on its factored accounts receivable portfolio than our other lending products described above.

Our payments business is a payments network for the over-the-road trucking industry. This platform was originally designed to manage Carrier payments for third party logistics companies, or 3PLs ("Brokers") and the manufacturers and other businesses that contract directly for the shipment of goods (“Shippers”), with a focus on increasing on-balance sheet factored receivable transactions through the offering of quick pay transactions for Carriers receiving such payments through the network. During 2021, we acquired HubTran, Inc., a software platform that offers workflow solutions for the processing and approval of Carrier Invoices for approval by Brokers or purchase by the factoring businesses providing working capital to Carriers ("Factors"). Following such acquisition, our strategy shifted from a capital-intensive on-balance sheet product with a greater focus on interest income to a network for the trucking industry with an additional focus on fee revenue. Our network connects Brokers, Shippers, Factors and Carriers through forward-thinking solutions that help each party successfully manage the life cycle of invoice presentment for services provided by Carrier through the processing and audit of such invoice to its ultimate payment to the Carrier or the Factor providing working capital to such Carrier.

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As part of our payments business, we also offer our LoadPay product; a digital banking platform developed for Carriers. LoadPay provides a user experience and financial products, including small business transactional accounts, tailored to the financial needs of the small trucking companies that are the ultimate payees inside of the network. A key feature of the LoadPay product is our ability to rapidly fund invoices approved for payment through the network or approved for purchase as part of our factoring operations to the LoadPay account without the need for such payments to be processed through traditional payment rails such as ACH transfers. We also offer supply chain finance to Brokers, allowing them to pay their Carriers faster and drive Carrier loyalty. In addition, through the network, we provide tools and services to increase automation, mitigate fraud, create back-office efficiency and improve the payment experience. Our payments business also operates in a highly specialized niche with unique processes and key performance indicators.

Our data intelligence business, which we call Intelligence, was launched at the beginning of the fourth quarter of 2024 to turn the over-the-road trucking data collected through our services into actionable insights for our customers. This launch coincided with our acquisition of Isometric Technologies Inc., a company that provides service and performance scoring and benchmarking capabilities to the over-the-road trucking industry. The operations of this segment were further supplemented with our acquisition of Greenscreens AI. Inc., a pricing solution for the logistics industry that delivers short-term freight market pricing intelligence and business insights during the quarter ended June 30, 2025. Data has the ability to drive efficiency, enhance decision-making, and enable Shippers, Brokers, and Carriers to operate more profitably in a very competitive over-the-road trucking market. With our access to data from our payments network and other sources, we believe we can develop products and services to offer to logistics service providers, allowing them to better plan for peak periods, competitively source freight capacity, and allocate resources efficiently, thus improving their profitability. Our Intelligence business operates in a highly specialized niche with unique processes and key performance indicators.

At June 30, 2026, our business is primarily focused on providing financial services to participants in the for-hire trucking ecosystem in the United States, including Brokers, Shippers, Factors and Carriers. Within such ecosystem, we operate our payments platform, which connects such parties to streamline and optimize the presentment, audit and payment of transportation invoices. We also act as capital provider to the Carrier industry through our factoring business. We have begun to offer data services through our Intelligence offerings. Our traditional banking operations provide stable, low cost deposits to support our operations, a diversified lending portfolio to add stability to our balance sheet, and a suite of traditional banking products and services to participants in the for-hire trucking ecosystem to deepen our relationship with such clients.

We have determined our reportable segments are Banking, Factoring, Payments and Intelligence. For the six months ended June 30, 2026, our Banking segment generated 50% of our total segment revenue (comprised of interest and noninterest income), our Factoring segment generated 35% of our total segment revenue, our Payments segment generated 14% of our total segment revenue, and our Intelligence segment generated 1% of our total segment revenue.

Second Quarter 2026 Overview

Net income available to common stockholders for the three months ended June 30, 2026 was $10.6 million, or $0.44 per diluted share, compared to a net income to common stockholders for the three months ended June 30, 2025 of $3.6 million, or $0.15 per diluted share. For the three months ended June 30, 2026, our return on average common equity was 4.59% and our return on average assets was 0.63%.

Net income available to common stockholders for the six months ended June 30, 2026 was $16.1 million, or $0.67 per diluted share, compared to net income available to common stockholders for the six months ended June 30, 2025 of $2.8 million, or $0.12 per diluted share. For the six months ended June 30, 2026, our return on average common equity was 3.55% and our return on average assets was 0.52%.

At June 30, 2026, we had total assets of $7.404 billion, including gross loans held for investment of $5.477 billion, compared to $6.381 billion of total assets and $4.991 billion of gross loans held for investment at December 31, 2025. Total loans held for investment increased $485.8 million during the six months ended June 30, 2026. Our Banking loans, which constitute 61% of our total loan portfolio at June 30, 2026, decreased from $3.525 billion in aggregate as of December 31, 2025 to $3.337 billion as of June 30, 2026, a decrease of 5.3%. Our Factoring factored receivables, which constitute 32% of our total loan portfolio at June 30, 2026, increased from $1.221 billion in aggregate as of December 31, 2025 to $1.748 billion as of June 30, 2026, an increase of 43.2%. Our Payments factored receivables, which constitute 7% of our total loan portfolio at June 30, 2026, increased from $242.1 million in aggregate as of December 31, 2025 to $387.4 million as of June 30, 2026, an increase of 60.0%.

At June 30, 2026, we had total liabilities of $6.440 billion, including total deposits of $6.217 billion, compared to $5.439 billion of total liabilities and $4.950 billion of total deposits at December 31, 2025. Deposits increased $1.267 billion during the six months ended June 30, 2026.

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At June 30, 2026, we had total stockholders' equity of $963.3 million. During the six months ended June 30, 2026, total stockholders’ equity increased $21.5 million. Capital ratios remained strong with Tier 1 capital and total capital to risk weighted assets ratios of 10.47% and 12.28%, respectively, at June 30, 2026.

The total dollar value of invoices purchased by our Factoring segment during the three months ended June 30, 2026 was $4.117 billion with an average invoice size of $2,201. The average transportation invoice size for the three months ended June 30, 2026 was $2,160. This compares to invoice purchase volume of $2.874 billion with an average invoice size of $1,693 and average transportation invoice size of $1,663 during the same period a year ago.

Our Payments segment processed 9.1 million invoices paying Carriers a total of $13.492 billion during the three months ended June 30, 2026. This compares to processed volume of 8.5 million invoices for a total of $10.081 billion during the same period a year ago.

Items of Note

Triumph Financial Headquarters Update

On December 17, 2025, we sold the building in Dallas, Texas originally purchased in March 2024 for the purpose of constructing a future headquarters for Triumph Financial and will not occupy the building in any capacity. The building was sold for $64.0 million in cash, resulting in a gain on sale of $8.7 million. The gain on sale was allocated to the Corporate and Other category for segment reporting.

Restructuring Activities

In August 2025, we announced a reduction in force involving approximately 5% of our workforce, as well as other cost saving initiatives including non-headcount related reductions in facilities, legacy technology, vendor spend, and travel. These actions are part of our initiatives to re-balance our cost structure in light of technology investments that have delivered significant efficiencies across the organization. These advancements have reduced the need for certain roles and prompted a reorganization of teams and responsibilities to better serve our transportation verticals. We believe these actions will strengthen our competitive position, enhance operational agility, and support sustainable long-term growth.

During the year ended December 31, 2025, we recognized $3.2 million of expense related to the reduction in force, which consisted primarily of one-time termination charges arising from severance obligations and other customary employee benefit payments made in connection with a reduction in force. These costs were included in salaries and benefits expense in the consolidated statements of income and for segment reporting, $0.5 million of the expense was recognized by the Banking segment, $1.1 million was recognized by the Factoring segment, $0.5 million was recognized by the Payments segment, $0.2 million was recognized by the Intelligence segment, and $0.8 million was allocated to the corporate and other category. The Company also recognized $1.3 million of expense during the year ended December 31, 2025 related to the cost saving initiatives, which consisted primarily of one-time contract amendment fees. These costs were included in professional fees in the consolidated statements of income and were allocated to the corporate and other category for segment reporting.

USPS Settlement

•$11.5 million to the aforementioned large carrier,

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•$19.4 million to relieve the entire balance of Misdirected Payments Receivable, net of customer reserves,

•$1.1 million of interest and fees,

•$7.9 million of legal expense recovery

•$3.8 million to recovery of previously charged-off acquired over-formula advances related to the aforementioned large carrier, and

•$3.8 million to CVLG in accordance with the amended terms of the CVLG transaction.

The USPS Settlement had a $12.4 million and $11.5 million positive impact on pretax net income for the three and six months ended June 30, 2025, respectively made up of the prior period impacts of the interest and fees, legal expense recovery, and the recovery of the previously charged-off acquired over-formula advances. The $19.4 million Misdirected Payments Receivable balance was legally discharged upon receipt of the settlement proceeds on July 10, 2025.

Greenscreens.ai

On May 8, 2025, we, through our wholly-owned subsidiary TBK Bank, SSB, acquired Greenscreens AI, Inc. ("Greenscreens"), a pricing solution for the logistics industry that delivers short-term freight market pricing intelligence and business insights, for $139.0 million in cash and $12.7 million of our common stock.

For further information on the above transactions see Note 2 – Business Combinations and Divestitures in the accompanying notes to the consolidated financial statements included elsewhere in this report.

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Transportation Update

Our business is primarily focused on providing financial services to participants in the for-hire trucking ecosystem in the United States, including Brokers, Shippers, Factors and Carriers. Because of this, we consider transportation revenue growth to be a key performance indicator for the Company. We generally measure transportation revenue growth on a linked quarter and a year-over-year timeframe. The table below illustrates such growth and further details around the calculation of revenue at each segment can be found in the tables within the Operating Segment Results section of Management's Discussion and Analysis of Financial Condition and Results of Operations.


	Three Months Ended						Linked Quarter				Year over Year
(Dollars in thousands)	June 30, 2026		March 31, 2026		June 30, 2025		$ Change		% Change		$ Change		% Change
Transportation Revenue
Factoring revenue	$	52,993	$	41,773	$	40,761	$	11,220	26.9	%	$	12,232	30.0	%
Intersegment noninterest income	(910)		(911)		(910)		1		(0.1)	%	—		—	%
Factoring revenue excluding intersegment noninterest income	$	52,083	$	40,862	$	39,851	$	11,221	27.5	%	$	12,232	30.7	%

Payments revenue	$	22,296	$	19,104	$	17,231	$	3,192	16.7	%	$	5,065	29.4	%
Intersegment noninterest income	(266)		(287)		(381)		21		(7.3)	%	115		(30.2)	%
Payments revenue excluding intersegment noninterest income	$	22,030	$	18,817	$	16,850	$	3,213	17.1	%	$	5,180	30.7	%

Intelligence revenue	$	2,389	$	2,397	$	1,724	$	(8)	(0.3)	%	$	665	38.6	%

Transportation revenue	$	76,502	$	62,076	$	58,425	$	14,426	23.2	%	$	18,077	30.9	%

Our transportation revenues, particularly factoring revenue in our Factoring and Payments segments, are highly correlated to fluctuations in the freight markets, particularly in brokered freight, which is priced largely off the spot market (a reflection of real-time balance of carrier supply and shipper demand in the market) and subject to variability in diesel prices. The softness in freight since 2023 was a combination of falling volumes and excess capacity. Throughout those years, average rates per mile decreased and returned spot rates to levels last seen in 2019. For the spot rate market, the drop was a little higher than the drop in diesel prices over the same period. Spot rates had fallen below the cost per mile to operate for many carriers. As a result, we observed a number of small and medium-sized trucking companies either leave the market by signing on with larger carriers or electing to sell their fleets or companies and move on to other endeavors, though the pace of these exits has slowed recently. The confluence of these circumstances resulted in persistently low invoice prices and decreased prices of new and used equipment in recent years. Beginning in the fourth quarter of 2025 and continuing through the first half of 2026, capacity dynamics have shifted as increased CDL enforcement for non-domiciled drivers and heightened focus on English proficiency requirements reduced the effective supply of available drivers. This tightening in capacity began to rebalance the freight market, contributing to improved freight availability and rising spot rates. Over the same period, diesel prices also increased, driven primarily by higher crude oil prices and refinery constraints resulting in spot rates and fuel level reaching highs not seen in several years and driving improved revenue performance in our factoring segment.

Over the past several quarters, prices of new and used equipment have remained steady which, over time, has improved the position of our current equipment finance borrowers, resulting in decreased equipment finance delinquencies and loan modifications. Equipment finance losses have been manageable to date.

Payments segment revenue growth generally has three drivers: winning new relationships, deepening existing relationships, and value-based pricing. Value-based pricing was the largest growth driver in payments revenue during the first half of 2026, but we also brought on and ramped up several new relationships while deepening relationships with others through our cross-selling efforts. Further, as fees are generally charged on a per invoice processed basis, an increase in payment invoices processed also drove an increase in Payments segment revenue.

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Financial Highlights


	Three Months Ended June 30,						Six Months Ended June 30,
(Dollars in thousands, except per share amounts)	2026			2025			2026			2025
Income Statement Data:
Interest income	$	124,537		$	109,201		$	227,292		$	211,471
Interest expense	25,711			20,523			42,372			38,410
Net interest income	98,826			88,678			184,920			173,061
Credit loss expense (benefit)	2,736			(702)			2,129			628
Net interest income after credit loss expense (benefit)	96,090			89,380			182,791			172,433


Noninterest income	21,415			19,384			41,122			36,574
Noninterest expense	101,634			100,840			199,895			201,013
Net income (loss) before income taxes	15,871			7,924			24,018			7,994
Income tax expense (benefit)	4,501			3,504			6,293			3,557
Net income (loss)	$	11,370		$	4,420		$	17,725		$	4,437
Dividends on preferred stock	(802)			(802)			(1,603)			(1,603)
Net income available (loss) to common stockholders	$	10,568		$	3,618		$	16,122		$	2,834

Per Share Data:
Basic earnings (loss) per common share	$	0.44		$	0.15		$	0.68		$	0.12
Diluted earnings (loss) per common share	$	0.44		$	0.15		$	0.67		$	0.12
Weighted average shares outstanding - basic	23,865,432			23,590,119			23,826,458			23,476,888
Weighted average shares outstanding - diluted	24,148,509			23,772,655			24,124,015			23,728,005





Performance ratios - Annualized:
Return on average assets	0.63		%	0.28		%	0.52		%	0.14		%
Return on average total equity	4.71		%	1.95		%	3.72		%	0.99		%
Return on average common equity	4.59		%	1.68		%	3.55		%	0.66		%
Return on average tangible common equity (1)	8.09		%	2.81		%	6.32		%	1.02		%
Yield on loans	8.56		%	8.41		%	8.16		%	8.39		%
Cost of interest bearing deposits	3.84		%	2.22		%	2.92		%	2.18		%
Cost of total deposits	1.58		%	1.25		%	1.35		%	1.24		%
Cost of total funds	1.66		%	1.53		%	1.45		%	1.49		%
Net interest margin	6.15		%	6.43		%	6.11		%	6.46		%
Net noninterest expense to average assets	4.43		%	5.13		%	4.63		%	5.36		%

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(Dollars in thousands, except per share amounts)	June 30, 2026			December 31, 2025
Balance Sheet Data:
Total assets	$	7,403,685		$	6,380,588
Cash and cash equivalents	896,811			248,471
Investment securities	273,635			370,415
Loans held for investment, net	5,442,308			4,954,796
Total liabilities	6,440,422			5,438,817
Noninterest bearing deposits	3,780,765			1,901,638
Interest bearing deposits	2,436,624			3,048,578
FHLB advances	—			280,000
Subordinated notes	69,979			69,879
Junior subordinated debentures	43,321			42,991
Total stockholders’ equity	963,263			941,771
Preferred stockholders' equity	45,000			45,000
Common stockholders' equity	918,263			896,771

Per Share Data:
Book value per share	$	38.43		$	37.73
Tangible book value per share (1)	$	21.76		$	20.77
Shares outstanding end of period	23,894,537			23,765,385

Asset Quality ratios(2):
Past due to total loans	2.19		%	2.72		%
Nonperforming loans to total loans	1.65		%	1.15		%
Nonperforming assets to total assets	1.29		%	1.10		%
ACL to nonperforming loans	38.43		%	63.44		%
ACL to total loans	0.64		%	0.73		%
Net charge-offs to average loans(3)	0.07		%	0.38		%

Capital ratios:
Tier 1 capital to average assets	9.15		%	9.86		%
Tier 1 capital to risk-weighted assets	10.47		%	10.74		%
Common equity Tier 1 capital to risk-weighted assets	9.00		%	9.16		%
Total capital to risk-weighted assets	12.28		%	12.71		%
Total stockholders' equity to total assets	13.01		%	14.76		%
Tangible common stockholders' equity ratio (1)	7.42		%	8.26		%

(1)The Company uses certain non-GAAP financial measures to provide meaningful supplemental information regarding the Company’s operational performance and to enhance investors’ overall understanding of such financial performance. The non-GAAP measures used by the Company include the following:

•"Tangible common stockholders' equity" is defined as common stockholders' equity less goodwill and other intangible assets.

•“Total tangible assets” is defined as total assets less goodwill and other intangible assets.

•“Tangible book value per share” is defined as tangible common stockholders’ equity divided by total common shares outstanding. This measure is important to investors interested in changes from period-to-period in book value per share exclusive of changes in intangible assets.

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•“Tangible common stockholders’ equity ratio” is defined as the ratio of tangible common stockholders’ equity divided by total tangible assets. We believe that this measure is important to many investors in the marketplace who are interested in relative changes from period-to period in common equity and total assets, each exclusive of changes in intangible assets.

•“Return on average tangible common equity” is defined as net income available to common stockholders divided by average tangible common stockholders’ equity.

(2)Asset quality ratios exclude loans held for sale, except for non-performing assets to total assets.

(3)Net charge-offs to average loans ratios are for the six months ended June 30, 2026 and the year ended December 31, 2025.

GAAP Reconciliation of Non-GAAP Financial Measures

We believe the non-GAAP financial measures included above provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with GAAP; however, we acknowledge that our non-GAAP financial measures have a number of limitations. The following reconciliation table provides a more detailed analysis of the non-GAAP financial measures:


	Three Months Ended June 30,						Six Months Ended June 30,
(Dollars in thousands, except per share amounts)	2026			2025			2026			2025








Average total stockholders' equity	$	968,408		$	910,202		$	960,486		$	906,253
Average preferred stock liquidation preference	(45,000)			(45,000)			(45,000)			(45,000)
Average total common stockholders' equity	923,408			865,202			915,486			861,253
Average goodwill and other intangibles	(399,652)			(347,894)			(400,898)			(302,896)
Average tangible common equity	$	523,756		$	517,308		$	514,588		$	558,357

Net income available to common stockholders	$	10,568		$	3,618		$	16,122		$	2,834
Average tangible common equity	523,756			517,308			514,588			558,357
Return on average tangible common equity	8.09		%	2.81		%	6.32		%	1.02		%












Net noninterest expense to average assets ratio:
Total noninterest expense	$	101,634		$	100,840		$	199,895		$	201,013
Total noninterest income	21,415			19,384			41,122			36,574
Net noninterest expenses	$	80,219		$	81,456		$	158,773		$	164,439
Average total assets	$	7,257,952		$	6,366,984		$	6,917,405		$	6,181,549
Net noninterest expense to average assets ratio	4.43		%	5.13		%	4.63		%	5.36		%


(Dollars in thousands, except per share amounts)	June 30, 2026			December 31, 2025
Total stockholders' equity	$	963,263		$	941,771
Preferred stock liquidation preference	(45,000)			(45,000)
Total common stockholders' equity	918,263			896,771
Goodwill and other intangibles	(398,221)			(403,184)
Tangible common stockholders' equity	$	520,042		$	493,587
Common shares outstanding	23,894,537			23,765,385
Tangible book value per share	$	21.76		$	20.77

Total assets at end of period	$	7,403,685		$	6,380,588
Goodwill and other intangibles	(398,221)			(403,184)
Tangible assets at period end	$	7,005,464		$	5,977,404
Tangible common stockholders' equity ratio	7.42		%	8.26		%

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Results of Operations

Three months ended June 30, 2026 compared with three months ended June 30, 2025.

Net Income

We earned net income of $11.4 million for the three months ended June 30, 2026 compared to net income of $4.4 million for the three months ended June 30, 2025, an increase of $7.0 million.


	Three Months Ended June 30, 2026
(Dollars in thousands, except per share amounts)	2026		2025		$ Change		% Change
Interest income	$	124,537	$	109,201	$	15,336	14.0	%
Interest expense	25,711		20,523		5,188		25.3	%
Net interest income	98,826		88,678		10,148		11.4	%
Credit loss expense (benefit)	2,736		(702)		3,438		(489.7)	%
Net interest income after credit loss expense (benefit)	96,090		89,380		6,710		7.5	%
Noninterest income	21,415		19,384		2,031		10.5	%
Noninterest expense	101,634		100,840		794		0.8	%
Net income (loss) before income taxes	15,871		7,924		7,947		100.3	%
Income tax expense (benefit)	4,501		3,504		997		28.5	%
Net income (loss)	$	11,370	$	4,420	$	6,950	157.2	%

Details of the changes in the various components of net income are further discussed below.

Net Interest Income

Our operating results heavily depend on our net interest income, which is the difference between interest income on interest earning assets, including loans and securities, and interest expense incurred on interest bearing liabilities, including deposits and other borrowed funds. Interest rate fluctuations, as well as changes in the amount and type of interest earning assets and interest bearing liabilities, combine to affect net interest income. Our net interest income is affected by changes in the amount and mix of interest earning assets and interest bearing liabilities, referred to as a “volume change.” It is also affected by changes in yields earned on interest earning assets and rates paid on interest bearing liabilities, referred to as a “rate change.”

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The following table presents the distribution of average assets, liabilities and equity, as well as interest income and fees earned on average interest earning assets and interest expense paid on average interest bearing liabilities. Average balances and interest are inclusive of assets and deposits classified as held for sale.


	Three Months Ended June 30,
	2026				2025
(Dollars in thousands)	Average Balance	Interest	Average Rate(5)		Average Balance	Interest	Average Rate(5)
Interest earning assets:
Cash and cash equivalents	862,507	7,937	3.69	%	377,775	4,181	4.44	%
Taxable securities	305,173	3,889	5.11	%	409,277	5,705	5.59	%
Tax-exempt securities	2,276	15	2.64	%	2,535	16	2.53	%
FHLB and other restricted stock	4,260	146	13.75	%	17,687	246	5.58	%
Loans (1)	5,271,228	112,550	8.56	%	4,725,240	99,053	8.41	%
Total interest earning assets	6,445,444	124,537	7.75	%	5,532,514	109,201	7.92	%
Noninterest earning assets:
Cash and cash equivalents	65,757				77,913
Other noninterest earning assets	746,751				756,557
Total assets	7,257,952				6,366,984
Interest bearing liabilities:
Deposits:
Interest bearing demand(2)	678,219	13,181	7.80	%	722,653	916	0.51	%
Individual retirement accounts	35,623	113	1.27	%	41,694	131	1.26	%
Money market	662,643	4,233	2.56	%	586,420	3,931	2.69	%
Savings	550,784	1,623	1.18	%	519,067	1,354	1.05	%
Certificates of deposit	218,365	1,334	2.45	%	225,333	1,520	2.71	%
Brokered time deposits	306,476	3,019	3.95	%	614,168	6,618	4.32	%
Other brokered deposits	56,864	524	3.70	%	93,315	1,035	4.45	%
Total interest bearing deposits(2)	2,508,974	24,027	3.84	%	2,802,650	15,505	2.22	%
Federal Home Loan Bank advances	6,099	56	3.68	%	298,132	3,322	4.47	%
Subordinated notes	69,956	663	3.80	%	69,749	661	3.80	%
Junior subordinated debentures	43,223	965	8.95	%	42,587	1,035	9.75	%

Total interest bearing liabilities	2,628,252	25,711	3.92	%	3,213,118	20,523	2.56	%
Noninterest bearing liabilities and equity:
Noninterest bearing demand deposits	3,583,133				2,166,628
Other liabilities	78,159				77,036
Total equity	968,408				910,202
Total liabilities and equity	7,257,952				6,366,984
Net interest income		98,826				88,678
Interest spread (3)			3.83	%			5.36	%
Net interest margin (4)			6.15	%			6.43	%

(1)Balance totals include respective nonaccrual assets.

(2)See discussion below regarding mortgage warehouse clients' noninterest bearing servicing deposits.

(3)Net interest spread is the yield on average interest earning assets less the rate on interest bearing liabilities.

(4)Net interest margin is the ratio of net interest income to average interest earning assets.

(5)Ratios have been annualized.

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The following table presents loan yields earned on our loan portfolios:


	Three Months Ended June 30,
	2026						2025
(Dollars in thousands)	Average Balance		Interest		Average Rate		Average Balance		Interest		Average Rate
Banking	$	3,362,327	$	53,427	6.37	%	$	3,381,919	$	54,784	6.50	%
Factoring	1,580,178		50,166		12.73	%	1,138,792		38,040		13.40	%
Payments	328,723		8,957		10.93	%	204,529		6,230		12.22	%
Total loans	$	5,271,228	$	112,550	8.56	%	$	4,725,240	$	99,054	8.41	%

We earned net interest income of $98.8 million for the three months ended June 30, 2026 compared to $88.7 million for the three months ended June 30, 2025, an increase of $10.1 million, or 11.4%, primarily driven by the following factors.

Interest income increased $15.3 million, or 14.0%, due to changes in average interest earning assets which increased $912.9 million, or 16.5%, including an increase in average total loans of $546.0 million, or 11.6%. The average balance of our higher yielding Factoring factored receivables increased $441.4 million, or 38.8%, and our average Payments factored receivables increased $124.2 million, or 60.7%. Average Banking loans decreased $19.6 million, or 0.6% due to decreases in the average balances of commercial real estate, construction, land development, and land, and farmland loans. Interest income from our Banking loans is impacted by our lower yielding mortgage warehouse lending product. The average mortgage warehouse lending balance was $1.110 billion for the three months ended June 30, 2026 compared to $1.068 billion for the three months ended June 30, 2025.

Interest expense increased $5.2 million, or 25.3%, primarily driven by $12.3 million of deposit interest expense incurred in the current period from mortgage warehouse earnings interest rebates that exceeded interest earned on a given client's loans (see detailed discussion of this arrangement below). The impact of the excess mortgage warehouse rebates was partially offset by a decrease in total average interest-bearing liabilities of $584.9 million, or 18.2%, period over period, including a decrease in average total interest bearing deposits of $293.7 million, or 10.5% and a decrease in average FHLB borrowings of $292.0 million, or 98.0%. Increases and decrease in interest rates paid on our interest bearing liabilities were mixed. Average noninterest bearing demand deposits grew $1.417 billion primarily due to the recent influx of mortgage warehouse client deposits.

Net interest margin decreased to 6.15% for the three months ended June 30, 2026 from 6.43% for the three months ended June 30, 2025, a decrease of 28 basis points or 4.4%.

The decrease in our net interest margin was largely driven by lower short-term interest rates as the target Fed Funds rate was lower in the current period than in the same period in 2025, along with a higher proportion of our earning assets held in cash and cash equivalents.

Our average cost of interest bearing liabilities increased by 136 basis points. This increase in average cost was caused by the aforementioned excess mortgage warehouse rebates associated with mortgage warehouse client deposits.

The decrease in our net interest margin was also impacted by a decrease in our yield on interest earning assets of 17 basis points to 7.75% for the three months ended June 30, 2026. This decrease was primarily driven by an increase in lower yielding cash and cash equivalent balances, partially offset by higher yields on loans which increased 15 basis points to 8.56% for the period. Our higher yielding Factoring factored receivables as a percentage of the total loan portfolio increased period over period which had an upward impact on our overall loan yield.

Our mortgage warehouse business is more than self-funded due to the noninterest bearing servicing deposits of its clients. The average balance of such deposits was $2.045 billion and $781.3 million for the three months ended June 30, 2026 and 2025, respectively. Given their legal form, these deposits are classified as noninterest bearing deposits on our balance sheet. Despite their classification, many of these deposits are not truly free of cost as we compensate our clients for these balances in the form of an earnings interest rebate rather than deposit interest. As a result, such noninterest bearing deposits first decrease our loan yield before increasing our deposit rates. Because of the recent influx of these deposits, some clients hold significantly higher deposit balances than loan balances. As a result, we are now, in some cases, paying out more in rebates than we earn in interest on a given client’s loans. In those cases, we are recording that excess rebate as deposit interest expense. Whether recorded as interest expense or an offset to interest income, the effect on net interest income and net income is the same: these are profitable funds as they displace more expensive wholesale funding and can be invested risk-free above their cost. During the three months ended June 30, 2026 and June 30, 2025, deposit interest expense recognized on these deposits was $12.3 million and $0, respectively.

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The following table shows the impact of mortgage warehouse excess rebates:


	Three Months Ended June 30,
	2026
(Dollars in thousands)	Average Balance		Interest		Average Rate(1)
Interest bearing demand deposits	$	678,219	$	13,181	7.80	%
Mortgage warehouse excess rebates	$	678,219	12,342		7.30	%
Interest bearing demand deposits excluding mortgage warehouse excess rebates	$	678,219	$	839	0.50	%

Total interest bearing deposits	$	2,508,974	$	24,027	3.84	%
Mortgage warehouse excess rebates	$	2,508,974	12,342		1.97	%
Total interest bearing deposits excluding mortgage warehouse excess rebates	$	2,508,974	$	11,685	1.87	%

(1)Ratios have been annualized.

The following table shows the effects that changes in average balances (volume) and average interest rates (rate) had on the interest earned on our interest earning assets and the interest incurred on our interest bearing:


	Three Months Ended
	June 30, 2026 vs. 2025
	Increase (Decrease) Due to:
(Dollars in thousands)	Rate		Volume		Net Increase
Interest earning assets:
Cash and cash equivalents	$	(705)	$	4,461	$	3,756
Taxable securities	(489)		(1,327)		(1,816)
Tax-exempt securities	1		(2)		(1)
FHLB and other restricted stock	360		(460)		(100)
Loans	1,839		11,658		13,497
Total interest income	1,006		14,330		15,336
Interest bearing liabilities:
Interest bearing demand	13,129		(864)		12,265
Individual retirement accounts	1		(19)		(18)
Money market	(185)		487		302
Savings	176		93		269
Certificates of deposit	(143)		(43)		(186)
Brokered time deposits	(568)		(3,031)		(3,599)
Other brokered deposits	(175)		(336)		(511)
Total interest bearing deposits	12,235		(3,713)		8,522
Federal Home Loan Bank advances	(585)		(2,681)		(3,266)
Subordinated notes	—		2		2
Junior subordinated debentures	(84)		14		(70)
Other borrowings	—		—		—
Total interest expense	11,566		(6,378)		5,188
Change in net interest income	$	(10,560)	$	20,708	$	10,148

Credit Loss Expense

Credit loss expense is the amount of expense that, based on our judgment, is required to maintain the allowances for credit losses (“ACL”) at an appropriate level under the current expected credit loss model. The determination of the amount of the allowance is complex and involves a high degree of judgment and subjectivity. Refer to Note 1 of the Company’s 2025 Form 10-K for detailed discussion regarding ACL methodologies for available for sale debt securities, held to maturity securities and loans held for investment.

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The following table presents the major categories of credit loss expense:


	Three Months Ended June 30,
(Dollars in thousands)	2026		2025		$ Change		% Change
Credit loss expense (benefit) on loans	$	2,364	$	(516)	$	2,880	558.1	%
Credit loss expense (benefit) on off balance sheet credit exposures	476		(89)		565		634.8	%
Credit loss expense (benefit) on held to maturity securities	(104)		(97)		(7)		(7.2)	%
Credit loss expense on available for sale securities	—		—		—		—
Total credit loss expense (benefit)	$	2,736	$	(702)	$	3,438	489.7	%

For available for sale debt securities in an unrealized loss position, the Company evaluates the securities at each measurement date to determine whether the decline in the fair value below the amortized cost basis (impairment) is due to credit-related factors or noncredit-related factors. Any impairment that is not credit related is recognized in other comprehensive income, net of applicable taxes. Credit-related impairment is recognized as an ACL on the balance sheet, limited to the amount by which the amortized cost basis exceeds the fair value, with a corresponding adjustment to earnings via credit loss expense. At June 30, 2026 and March 31, 2026, the Company determined that all impaired available for sale securities experienced a decline in fair value below the amortized cost basis due to noncredit-related factors. Therefore, the Company carried no ACL at those respective dates and there was no credit loss expense recognized by the Company during the three months ended June 30, 2026. The same was true for the same period in the prior year.

The ACL on held to maturity ("HTM") securities is estimated at each measurement date on a collective basis by major security type. At June 30, 2026 and December 31, 2025, the Company’s held to maturity ("HTM") securities consisted of investments in the subordinated notes of collateralized loan obligation (“CLO”) funds. Expected credit losses for these securities are estimated using a discounted cash flow methodology which considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. At June 30, 2026 and March 31, 2026, the Company carried $3.1 million and $3.1 million, respectively, of these HTM securities at amortized cost. The required ACL on these balances was $2.1 million at June 30, 2026 and $2.1 million at March 31, 2026. We recognized a benefit to credit loss expense of $0.1 million during the current quarter. Credit loss expense during the three months ended June 30, 2025 was also a benefit of $0.1 million. None of the overcollateralization triggers tied to the CLO securities were tripped as of June 30, 2026. Ultimately, the realized cash flows on CLO securities such as these will be driven by a variety of factors, including credit performance of the underlying loan portfolio, adjustments to the portfolio by the asset manager, and the timing of a potential call.

Our ACL on loans was $34.8 million as of June 30, 2026, compared to $36.5 million as of December 31, 2025, representing an ACL to total loans ratio of 0.64% and 0.73%, respectively.

Our credit loss expense on loans increased $2.9 million, or 558.1%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025.

During the three months ended June 30, 2025, the Company acquired a $23.4 million nonperforming equipment finance commercial loan for $3.3 million. The loan was purchased credit deteriorated ("PCD") and a $10.8 million ACL was established on Day 1 resulting in a discount of $9.3 million. Prior to June 30, 2025, the Company determined that the $10.8 million ACL was uncollectible and charged off the entire amount. Such charge-off had no impact on credit loss expense.

The increase in credit loss expense was primarily driven by net charge-off activity. During the three months ended June 30, 2026, we had net charge-offs of $1.7 million. Excluding the $10.8 million charge-off on the acquired PCD loan which had no impact on credit loss expense, we had a net recovery of $3.0 million during the three months ended June 30, 2025. Such net charge-offs for the three months ended June 30, 2025 includes the aforementioned $3.8 million recovery resulting from the USPS Settlement. Further, changes in volume and mix of the loan portfolio resulted in credit loss expense of $3.1 million during the three months ended June 30, 2026 compared to $1.2 million of credit loss expense during the same period a year ago. The increase in credit loss expense was partially offset by changes to projected loss drivers and prepayment speeds that the Company forecasted over the reasonable and supportable forecast periods to calculate expected losses which resulted in a benefit to credit loss expense of $2.0 million during the three months ended June 30, 2026 compared to $0.2 million of benefit to credit loss expense during the same period a year ago. The increase in credit loss expense was also partially offset by changes in required specific reserves. Such specific reserves decreased $0.6 million during the three months ended June 30, 2026 compared to an increase of $1.5 million during the same period a year ago.

Credit loss expense for off balance sheet credit exposures increased $0.6 million, primarily due to changes to outstanding commitments to fund and changes to assumed loss rates period over period.

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Noninterest Income

The following table presents our major categories of noninterest income:


	Three Months Ended June 30,
(Dollars in thousands)	2026		2025		$ Change		% Change
Service charges on deposits	$	1,798	$	1,742	$	56	3.2	%
Card income	2,129		1,922		207		10.8	%

Net gains (losses) on sale of loans	100		190		(90)		(47.4)	%
Net gains (losses) on disposal of premises and equipment	(1,779)		(218)		(1,561)		(716.1)	%
Fee income	15,527		12,755		2,772		21.7	%
Insurance commissions	1,006		1,282		(276)		(21.5)	%
Other	2,634		1,711		923		53.9	%
Total noninterest income	$	21,415	$	19,384	$	2,031	10.5	%

Noninterest income increased $2.0 million, or 10.5%. Changes in selected components of noninterest income in the above table are discussed below.

•Net gains (losses) on disposal of premises and equipment. Net gains (losses) on disposal of premises and equipment decreased $1.6 million due to a valuation adjustment on a real estate of a branch we are in the process of closing and a terminated prepaid maintenance agreement.

•Fee income. Fee income increased $2.8 million due to a $3.1 million increase in fee income from our Payments segment and a $0.7 million increase in fee income from our Intelligence segment, partially offset by a $1.1 million decrease in fee income from insurance services. There were no other significant changes within the components of fee income.

•Other. Other noninterest income increased $0.9 million due to a $1.8 million payment tied to a change in control provision on the sale of an unrelated third-party business. There were no other significant changes within the components of other noninterest income.

Noninterest Expense

The following table presents our major categories of noninterest expense:


	Three Months Ended June 30,
(Dollars in thousands)	2026		2025		$ Change		% Change
Salaries and employee benefits	$	60,087	$	59,882	$	205	0.3	%
Occupancy, furniture and equipment	6,364		8,139		(1,775)		(21.8)	%
FDIC insurance and other regulatory assessments	1,167		894		273		30.5	%
Professional fees	7,089		(320)		7,409		(2,315.3)	%
Amortization of intangible assets	2,486		3,400		(914)		(26.9)	%
Advertising and promotion	1,405		1,838		(433)		(23.6)	%
Communications and technology	11,950		12,315		(365)		(3.0)	%
Software amortization	3,477		2,865		612		21.4	%
Travel and entertainment	1,208		1,619		(411)		(25.4)	%
Other	6,401		10,208		(3,807)		(37.3)	%
Total noninterest expense	$	101,634	$	100,840	$	794	0.8	%

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Noninterest expense increased $0.8 million, or 0.8%. Details of the more significant changes in the various components of noninterest expense are further discussed below.

•Salaries and Employee Benefits. Salaries and employee benefits expenses increased $0.2 million, or 0.3%. Our average full-time equivalent employees were 1,440.3 and 1,576.0 for the three months ended June 30, 2026 and 2025, respectively. Employee salaries decreased $1.3 million, bonus expense decreased $1.4 million, and temporary labor decreased $0.1 million. These decreases were offset by an increase in severance expense of $1.8 million, an increase in commissions expense of $0.5 million, and an increase in employee benefits expense such as 401(k) benefits match, employee insurance and stock based compensation of $0.9 million.

•Occupancy, Furniture and Equipment. Occupancy, furniture and equipment expenses decreased $1.8 million, or 21.8%, primarily due to a $1.2 million decrease in depreciation expense and a $0.3 million decrease in building property taxes mostly driven by the sale of the building in December 2025 that had been purchased for the purpose of constructing a future headquarters for Triumph.

•Professional Fees. Professional fees increased $7.4 million, primarily due to the recovery of $7.4 million of previously expensed legal fees through the USPS Settlement during the three months ended June 30, 2025 and $2.0 million of non-recurring consulting fees incurred during the three months ended June 30, 2026 related to our ongoing efficiency initiatives. The increase was partially offset by $3.0 million of professional fees incurred during the three months ended June 30, 2025 as a result of the Greenscreens acquisition that did not recur in the current period.

•Amortization of Intangible Assets. Amortization of intangible assets decreased $0.9 million, or 26.9%, primarily due to $0.4 million decrease in lease intangible amortization driven by the sale of the building in December 2025 that had been purchased for the purpose of constructing a future headquarters for Triumph.

•Software Amortization. Software amortization expense increased $0.6 million, or 21.4%, primarily due to additional software assets coming on line during late 2025 and early 2026.

•Other. Other noninterest expense, which includes loan-related expenses, training and recruiting, postage, insurance, and subscription services, decreased $3.8 million, or 37.3%. Other noninterest expense for the three months ended June 30, 2025 included a $2.0 million litigation settlement (unrelated to the USPS Settlement) and $1.8 million of lease termination payments related to the building we sold in December 2025. There were no other significant changes within the components of other noninterest expense.

Income Taxes

The amount of income tax expense is influenced by the amount of pre-tax income, the amount of tax-exempt income and the effect of changes in valuation allowances maintained against deferred tax benefits.

Income tax expense increased $1.0 million, from $3.5 million for the three months ended June 30, 2025 to $4.5 million for the three months ended June 30, 2026. The effective tax rate was 28% for the three months ended June 30, 2026, compared to 44% for the three months ended June 30, 2025. The effective tax rate for the three months ended June 30, 2025 was impacted by limited restricted stock stock-based compensation deductibility, higher state tax rates, and higher disallowed expenses including some transaction costs paid in connection with the Greenscreens acquisition.

Operating Segment Results

See Note 16 – Business Segment Information in the accompanying condensed notes to the consolidated financial statements included elsewhere in this report for a description of our reportable segments.

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The following tables present our primary operating results for our operating segments:


(Dollars in thousands)									Total		Corporate
Three Months Ended June 30, 2026	Banking		Factoring		Payments		Intelligence		Segments		and Other(1)		Consolidated
Total interest income	$	65,381	$	50,166	$	8,957	$	—	$	124,504	$	33	$	124,537
Intersegment interest allocations	8,405		(10,585)		2,180		—		—		—		—
Total interest expense	24,076		7		—		—		24,083		1,628		25,711
Net interest income (expense)	49,710		39,574		11,137		—		100,421		(1,595)		98,826
Credit loss expense (benefit)	(30)		2,716		155		—		2,841		(105)		2,736
Net interest income after credit loss expense	49,740		36,858		10,982		—		97,580		(1,490)		96,090
Noninterest income	5,331		1,917		10,893		2,389		20,530		885		21,415
Noninterest expense:
Salaries and employee benefits	14,684		12,452		9,771		3,449		40,356		19,731		60,087
Depreciation	1,540		273		156		18		1,987		776		2,763
Other occupancy, furniture and equipment	2,128		463		163		13		2,767		834		3,601
FDIC insurance and other regulatory assessments	1,167		—		—		—		1,167		—		1,167
Professional fees	4,356		436		300		112		5,204		1,885		7,089
Amortization of intangible assets	269		111		812		1,283		2,475		11		2,486
Advertising and promotion	317		383		333		24		1,057		348		1,405
Communications and technology	3,405		2,459		3,106		358		9,328		2,622		11,950
Software amortization	—		1,117		1,932		77		3,126		351		3,477
Travel and entertainment	210		156		219		115		700		508		1,208
Other	2,912		567		1,583		269		5,331		1,070		6,401
Total noninterest expense	30,988		18,417		18,375		5,718		73,498		28,136		101,634
Net intersegment noninterest income (expense)(2)	144		518		(662)		—		—		—		—
Net income (loss) before income tax expense	$	24,227	$	20,876	$	2,838	$	(3,329)	$	44,612	$	(28,741)	$	15,871


(Dollars in thousands)									Total		Corporate
Three Months Ended June 30, 2025	Banking		Factoring		Payments		Intelligence		Segments		and Other(1)		Consolidated
Total interest income	$	64,851	$	38,040	$	6,230	$	—	$	109,121	$	80	$	109,201
Intersegment interest allocations	6,386		(9,282)		2,896		—		—		—		—
Total interest expense	18,825		2		—		—		18,827		1,696		20,523
Net interest income (expense)	52,412		28,756		9,126		—		90,294		(1,616)		88,678
Credit loss expense (benefit)	2,219		(2,916)		92		—		(605)		(97)		(702)
Net interest income after credit loss expense	50,193		31,672		9,034		—		90,899		(1,519)		89,380
Noninterest income	7,989		1,811		7,724		1,724		19,248		136		19,384
Noninterest expense:
Salaries and employee benefits	16,001		13,444		8,711		3,234		41,390		18,492		59,882
Depreciation	1,656		468		222		7		2,353		1,602		3,955
Other occupancy, furniture and equipment	1,896		508		163		14		2,581		1,603		4,184
FDIC insurance and other regulatory assessments	894		—		—		—		894		—		894
Professional fees	1,801		(7,272)		240		2,995		(2,236)		1,916		(320)
Amortization of intangible assets	385		193		1,418		946		2,942		458		3,400
Advertising and promotion	557		223		669		22		1,471		367		1,838
Communications and technology	5,257		2,438		2,455		278		10,428		1,887		12,315
Software amortization	—		1,125		1,413		—		2,538		327		2,865
Travel and entertainment	306		245		456		130		1,137		482		1,619
Other	3,210		2,770		1,097		84		7,161		3,047		10,208
Total noninterest expense	31,963		14,142		16,844		7,710		70,659		30,181		100,840
Net intersegment noninterest income (expense)(2)	155		413		(568)		—		—		—		—
Net income (loss) before income tax expense	$	26,374	$	19,754	$	(654)	$	(5,986)	$	39,488	$	(31,564)	$	7,924

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(1) Includes revenue and expense from the Company’s holding company, which does not meet the definition of an operating segment. Also includes corporate shared service costs such as the majority of salaries and benefits expense for our executive leadership team, as well as other selling, general, and administrative shared services costs including human resources, accounting, finance, risk management and a significant amount of information technology expense.

(2) Net intersegment noninterest income (expense) includes:


(Dollars in thousands)	Banking		Factoring		Payments
Three Months Ended June 30, 2026
Factoring revenue received from Payments	$	—	$	910	$	(910)
Payments revenue received from Factoring	—		(266)		266
Banking revenue received from Payments and Factoring	144		(126)		(18)
Net intersegment noninterest income (expense)	$	144	$	518	$	(662)

Three Months Ended June 30, 2025
Factoring revenue received from Payments	$	—	$	910	$	(910)
Payments revenue received from Factoring	—		(381)		381
Banking revenue received from Payments and Factoring	155		(116)		(39)
Net intersegment noninterest income (expense)	$	155	$	413	$	(568)


(Dollars in thousands)									Total		Corporate
June 30, 2026	Banking		Factoring		Payments		Intelligence		Segments		and Other		Eliminations		Consolidated
Total assets	$	4,820,467	$	1,821,671	$	838,251	$	111,973	$	7,592,362	$	1,123,430	$	(1,312,107)	$	7,403,685
Gross loans	$	3,337,212	$	1,752,492	$	387,387	$	—	$	5,477,091	$	—	$	—	$	5,477,091

(Dollars in thousands)									Total		Corporate
December 31, 2025	Banking		Factoring		Payments		Intelligence		Segments		and Other		Eliminations		Consolidated
Total assets	$	4,480,124	$	1,335,150	$	774,979	$	120,410	$	6,710,663	$	1,088,885	$	(1,418,960)	$	6,380,588
Gross loans	$	3,525,447	$	1,223,740	$	242,120	$	—	$	4,991,307	$	—	$	—	$	4,991,307

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Banking


(Dollars in thousands)	Three Months Ended June 30,
Banking	2026		2025		$ Change		% Change
Total interest income	$	65,381	$	64,851	$	530	0.8	%
Intersegment interest allocations	8,405		6,386		2,019		31.6	%
Total interest expense	24,076		18,825		5,251		27.9	%
Net interest income (expense)	49,710		52,412		(2,702)		(5.2)	%
Credit loss expense (benefit)	(30)		2,219		(2,249)		(101.4)	%
Net interest income after credit loss expense	49,740		50,193		(453)		(0.9)	%
Noninterest income	5,331		7,989		(2,658)		(33.3)	%
Noninterest expense:
Salaries and employee benefits	14,684		16,001		(1,317)		(8.2)	%
Depreciation	1,540		1,656		(116)		(7.0)	%
Other occupancy, furniture and equipment	2,128		1,896		232		12.2	%
FDIC insurance and other regulatory assessments	1,167		894		273		30.5	%
Professional fees	4,356		1,801		2,555		141.9	%
Amortization of intangible assets	269		385		(116)		(30.1)	%
Advertising and promotion	317		557		(240)		(43.1)	%
Communications and technology	3,405		5,257		(1,852)		(35.2)	%
Software amortization	—		—		—		—	%
Travel and entertainment	210		306		(96)		(31.4)	%
Other	2,912		3,210		(298)		(9.3)	%
Total noninterest expense	30,988		31,963		(975)		(3.1)	%
Net intersegment noninterest income (expense)	144		155		(11)		(7.1)	%
Operating income (loss)	$	24,227	$	26,374	$	(2,147)	(8.1)	%

Our Banking segment’s operating income decreased $2.1 million, or 8.1%.

Interest income increased $0.5 million, or 0.8%, at our Banking segment primarily as a result of increased interest income from cash deposits driven by an increase in the average balance of cash and cash equivalents period over period as a result of increased noninterest bearing deposit balances. This increase was partially offset by decreases in interest income from loans and securities. Average loans in our Banking segment, excluding intersegment loans, decreased 0.6% from $3.382 billion for the three months ended June 30, 2025 to $3.362 billion for the three months ended June 30, 2026, and our yields on these loans decreased period over period. The average balance of and yield on our debt securities also decreased period over period.

Intersegment interest income allocated to our Banking segment increased period over period due to increased funding provided to our Factoring segment resulting in increased intersegment interest allocation from such segment, partially offset by a decrease in intersegment interest allocations to our Payments segment.

Interest expense increased $5.3 million, or 27.9%, primarily driven by $12.3 million of deposit interest expense from mortgage warehouse earnings interest rebates that exceeded interest earned on a given client's loans, partially offset by lower average balances and decreased rates on our interest bearing liabilities.

Credit loss expense at our Banking segment is made up of credit loss expense related to loans and credit loss expense related to off balance sheet commitments to lend. Credit loss expense related to loans was a benefit of $0.5 million for the three months ended June 30, 2026 compared to credit loss expense on loans of $2.3 million for the three months ended June 30, 2025. The decrease in credit loss expense was the result of changes to the projected loss drivers and prepayment speeds that the company forecasted over the reasonable and supportable forecast periods and a decrease in required specific reserves at our Banking segment. The decrease in credit loss expense was partially offset by increases driven by changes in volume and mix of our Banking segment's loan portfolio period over period and increased net charge-offs at our Banking segment.

Credit loss expense for off balance sheet credit exposures at our Banking segment increased $0.6 million, from a benefit of $0.1 million for the three months ended June 30, 2025 to credit loss expense of $0.5 million for the three months ended June 30, 2026, primarily due to changes to outstanding commitments to fund and changes to assumed loss rates period over period.

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Noninterest income at our Banking segment decreased period over period due to a $1.1 million decrease in fee income from insurance services and a $0.9 million loss on disposal of premises and equipment during the three months ended June 30, 2026 due to a valuation adjustment on the real estate of a branch we are in the process of closing.

Noninterest expense at our Banking segment decreased period over period the details of which are illustrated in the table above. For the three months ended June 30, 2026, professional fees, a component of noninterest expense, at our Banking segment includes $2.0 million of non-recurring consulting fees incurred related to our ongoing efficiency initiatives.

Year to date, our aggregate outstanding balances for our banking products, excluding intercompany loans, has decreased $188.2 million, or 5.3%, to $3.337 billion as of June 30, 2026. The following table sets forth our banking loans:


(Dollars in thousands)	June 30, 2026		December 31, 2025		$ Change		% Change
Banking
Commercial real estate	$	667,520	$	730,435	$	(62,915)	(8.6)	%
Construction, land development, land	192,091		224,214		(32,123)		(14.3)	%
1-4 family residential	205,540		193,508		12,032		6.2	%
Farmland	42,909		43,433		(524)		(1.2)	%
Commercial - General	322,969		313,696		9,273		3.0	%
Commercial - Agriculture	51,130		42,588		8,542		20.1	%
Commercial - Equipment	621,884		587,926		33,958		5.8	%
Commercial - Asset-based lending	123,053		180,012		(56,959)		(31.6)	%
Commercial - Liquid Credit	37,091		36,482		609		1.7	%
Consumer	16,715		16,819		(104)		(0.6)	%
Mortgage Warehouse	1,056,310		1,156,334		(100,024)		(8.7)	%
Total banking loans	$	3,337,212	$	3,525,447	$	(188,235)	(5.3)	%

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Factoring


(Dollars in thousands)	Three Months Ended June 30,
Factoring	2026		2025		$ Change		% Change
Total interest income	$	50,166	$	38,040	$	12,126	31.9	%
Intersegment interest allocations	(10,585)		(9,282)		(1,303)		(14.0)	%
Total interest expense	7		2		5		250.0	%
Net interest income (expense)	39,574		28,756		10,818		37.6	%
Credit loss expense (benefit)	2,716		(2,916)		5,632		193.1	%
Net interest income (expense) after credit loss expense	36,858		31,672		5,186		16.4	%
Noninterest income	1,917		1,811		106		5.9	%
Noninterest expense:
Salaries and employee benefits	12,452		13,444		(992)		(7.4)	%
Depreciation	273		468		(195)		(41.7)	%
Other occupancy, furniture and equipment	463		508		(45)		(8.9)	%
FDIC insurance and other regulatory assessments	—		—		—		—	%
Professional fees	436		(7,272)		7,708		106.0	%
Amortization of intangible assets	111		193		(82)		(42.5)	%
Advertising and promotion	383		223		160		71.7	%
Communications and technology	2,459		2,438		21		0.9	%
Software amortization	1,117		1,125		(8)		(0.7)	%
Travel and entertainment	156		245		(89)		(36.3)	%
Other	567		2,770		(2,203)		(79.5)	%
Total noninterest expense	18,417		14,142		4,275		30.2	%
Net intersegment noninterest income (expense)	518		413		105		25.4	%
Net income (loss) before income tax expense	$	20,876	$	19,754	$	1,122	5.7	%

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	Three Months Ended June 30,
	2026			2025
Factored receivable period end balance	$	1,748,491,000		$	1,174,830,000
Commercial loans period end balance	$	4,001,000		$	2,593,000
Yield on average receivable balance	12.73		%	13.40		%
Current quarter charge-off rate	0.02		%	(0.19)		%
Factored receivables - transportation concentration	97		%	96		%

Interest income, including fees	$	50,166,000		$	38,040,000
Non-interest income	1,917,000			1,811,000
Intersegment noninterest income	910,000			910,000
Factored receivable total revenue	52,993,000			40,761,000
Average net funds employed	1,504,189,000			1,065,073,000
Yield on average net funds employed	14.13		%	15.35		%

Operating income (loss)	$	20,876,000		$	19,754,000
Factoring total revenue	$	52,993,000		$	40,761,000
Operating margin(1)	39.39		%	48.46		%

Accounts receivable purchased	$	4,117,210,000		$	2,873,659,000
Number of invoices purchased	1,870,938			1,697,851
Average invoice size	$	2,201		$	1,693
Average invoice size - transportation	$	2,160		$	1,663
Average invoice size - non-transportation	$	6,278		$	3,638

(1)Operating margin is a non-GAAP financial measure used as a supplemental measure to evaluate the performance of our Factoring segment. It provides meaningful supplemental information regarding the segment's operational performance and enhances investors' overall understanding of the Factoring segment's profitability and operational efficiency. For the three months ended June 30, 2025, operating income and factoring total revenue were impacted by $1.2 million of interest and fees resulting from the USPS Settlement and such settlement further impacted operating income by $7.4 million of legal expense accrual reversal and $3.8 million of recovery of factoring balances charged off in a prior period. Operating income was also impacted by a $2.0 million legal settlement that was unrelated to the USPS Settlement. Such items had a 24.71% impact on operating margin, a 0.43% impact on yield on average receivables, and a 0.46% impact on yield on average net funds employed for the three months ended June 30, 2025.

Our Factoring segment’s operating income increased $1.1 million, or 5.7%.

Our average invoice size increased 30.0% from $1,693 for the three months ended June 30, 2025 to $2,201 for the three months ended June 30, 2026. This increase is the result of a broad increase in transportation invoice prices across the industry as capacity exits and rising fuel costs began to impact pricing. Additionally, the number of invoices purchased increased 10.2% period over period.

Net interest income at our Factoring segment increased period over period. Overall average net funds employed (“NFE”) increased 41.2% during the three months ended June 30, 2026 compared to the same period in 2025. The increase in average NFE was the result of increased invoice purchase volume and increased average invoice sizes. See further discussion under the Recent Developments: Transportation Update section. We maintained a high concentration in transportation factoring balances, which typically generate a higher yield than our non-transportation factoring balances. This concentration was at 97% at June 30, 2026 and 96% at June 30, 2025. Net interest income at our Factoring segment was also impacted by an increase in intersegment interest allocation charges period over period driven by higher average balances at our Factoring segment, partially offset by lower intercompany rates consistent with lower rates in the broader macro economy period over period.

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Credit loss expense at our Factoring segment is made up of credit loss expense related to factored receivables and loans at our Factoring segment as well as credit loss expense related to off balance sheet commitments to lend, if any. Credit loss expense related to factored receivables and loans was $2.7 million for the three months ended June 30, 2026 compared to a benefit to credit loss expense on factored receivables of $2.9 million for the three months ended June 30, 2025. The increase in credit loss expense at our Factoring segment was driven by increased net charge-offs period over period as the period from the prior year reflects the $3.8 million recovery resulting from the USPS settlement. The increase was also driven by changes in volume and mix of the portfolio period over period and increased required specific reserves at our Factoring segment period over period. These increases were partially offset by a small decrease driven by changes in rate period over period at our Factoring segment.

There was no credit loss expense related to off balance sheet credit exposures during the three months ended June 30, 2026 or 2025 as there were no such commitments to lend at those times.

Noninterest income at our Factoring segment increased period over period primarily driven by increased fee income. There were no other significant variances in noninterest income at our Factoring segment.

Noninterest expense at our Factoring segment increased period over period the details of which are illustrated in the table above. For the three months ended June 30, 2025, professional fees, a component of noninterest expense, at our Factoring segment reflects a $7.4 million recovery of previously expensed legal fees associated with the USPS Settlement. Other noninterest expense at our Factoring segment for the three months ended June 30, 2025 included $2.0 million of expense driven by settlement of litigation unrelated to the USPS Settlement.

Payments


(Dollars in thousands)	Three Months Ended June 30,
Payments	2026		2025		$ Change		% Change
Total interest income	$	8,957	$	6,230	$	2,727	43.8	%
Intersegment interest allocations	2,180		2,896		(716)		(24.7)	%
Total interest expense	—		—		—		—	%
Net interest income (expense)	11,137		9,126		2,011		22.0	%
Credit loss expense (benefit)	155		92		63		68.5	%
Net interest income after credit loss expense	10,982		9,034		1,948		21.6	%
Noninterest income	10,893		7,724		3,169		41.0	%
Noninterest expense:
Salaries and employee benefits	9,771		8,711		1,060		12.2	%
Depreciation	156		222		(66)		(29.7)	%
Other occupancy, furniture and equipment	163		163		—		—	%
FDIC insurance and other regulatory assessments	—		—		—		—	%
Professional fees	300		240		60		25.0	%
Amortization of intangible assets	812		1,418		(606)		(42.7)	%
Advertising and promotion	333		669		(336)		(50.2)	%
Communications and technology	3,106		2,455		651		26.5	%
Software amortization	1,932		1,413		519		36.7	%
Travel and entertainment	219		456		(237)		(52.0)	%
Other	1,583		1,097		486		44.3	%
Total noninterest expense	18,375		16,844		1,531		9.1	%
Net intersegment noninterest income (expense)	(662)		(568)		(94)		(16.5)	%
Net income (loss) before income tax expense	$	2,838	$	(654)	$	3,492	533.9	%

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	Three Months Ended June 30,
	2026			2025
Supply chain financing factored receivables	$	287,454,000		$	152,054,000
QuickPay factored receivables	99,933,000			74,493,000
Factored receivable period end balance	$	387,387,000		$	226,547,000

Supply chain finance interest income	$	5,676,000		$	3,412,000
QuickPay interest income	3,281,000			2,818,000
Intersegment interest income	2,180,000			2,896,000
Total interest income	11,137,000			9,126,000
Broker noninterest income	9,536,000			6,443,000
Factor noninterest income	630,000			993,000
Other noninterest income	727,000			288,000
Intersegment noninterest income	266,000			381,000
Total noninterest income	11,159,000			8,105,000
Total revenue	$	22,296,000		$	17,231,000

Credit loss expense (benefit)	155,000			92,000
Noninterest expense	18,375,000			16,844,000
Intersegment noninterest expense	928,000			949,000
Total expense	$	19,458,000		$	17,885,000

Operating income (loss)	$	2,838,000		$	(654,000)
Depreciation expense	156,000			222,000
Software amortization expense	1,932,000			1,413,000
Intangible amortization expense	812,000			1,418,000
Earnings (losses) before interest, taxes, depreciation, and amortization(1)	$	5,738,000		$	2,399,000



EBITDA margin(1)	25.7		%	13.9		%

Number of invoices processed	9,086,400			8,500,565
Amount of payments processed	$	13,492,237,000		$	10,081,206,000
Network invoice volume	1,045,637			1,004,603
Network payment volume	$	2,277,297,000		$	1,579,662,000

LoadPay
Revenue	$	652,000		$	92,000
Pre-tax operating income (loss)	$	(2,052,000)		$	(1,751,000)
Depreciation expense	23,000			16,000
Software amortization expense	416,000			251,000
Earnings (losses) before interest, taxes, depreciation, and amortization(1)	$	(1,613,000)		$	(1,484,000)

Payments revenue excluding LoadPay	$	21,644,000		$	17,139,000
Payments EBITDA excluding LoadPay(2)	$	7,351,000		$	3,883,000
Payments EBITDA Margin excluding LoadPay(2)	34.0		%	22.7		%

(1)Earnings (losses) before interest, taxes, depreciation, and amortization ("EBITDA") and EBITDA margin are non-GAAP financial measures used as supplemental measures to evaluate the performance of our Payments segment. EBITDA is useful because it provides a clearer view of underlying operating performance by excluding the effects of capital structure, tax regimes, and non-cash depreciation and amortization. EBITDA margin complements EBITDA by illustrating how efficiently revenue is converted into operating profitability.

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(2)Payments EBITDA excluding LoadPay and Payments EBITDA Margin excluding LoadPay are non-GAAP financial metrics used as supplemental measures to evaluate the performance of our Payments segment exclusive of the investments associated with LoadPay, which is a relatively new product in its early stages. Such adjusted EBITDA measures provide comparable clarity into the performance of our Payments segment prior to the advent of our LoadPay product.

Our Payments segment's operating income was $2.8 million for the three months ended June 30, 2026 compared to an operating loss of $0.7 million for the three months ended June 30, 2025, an increase of $3.5 million, or 533.9%.

The number of invoices processed by our Payments segment increased 6.9% from 8,500,565 for the three months ended June 30, 2025 to 9,086,400 for the three months ended June 30, 2026, and the amount of payments processed increased 33.8% from $10.081 billion for the three months ended June 30, 2025 to $13.492 billion for the three months ended June 30, 2026.

A "network transaction" occurs when a fully integrated payor payments client receives an invoice from a fully integrated payee payments client. All network transactions are included in our payment processing volume above. These transactions are facilitated through our payments application programming interfaces ("APIs") with parties on both sides of the transaction using structured data; similar to how a credit card works at a point-of-sale terminal. The integrations largely automate the process and make it cheaper, faster and safer. During the three months ended June 30, 2026, we processed 1,045,637 network invoices representing a network payment volume of $2.277 billion. During the three months ended June 30, 2025, we processed 1,004,603 network invoices representing a network payment volume of $1.580 billion.

Net interest income increased due to an increased average balance of interest earning assets at our Payments segment. The increase was partially offset by decreased average rates at our Payments segment and decreased intersegment interest allocations.

Noninterest income increased due to a $3.1 million increase in fee income earned from our payment processing and audit business during the three months ended June 30, 2026 compared to the same period a year ago.

Noninterest expense at our Payments segment increased period over period the details of which are illustrated in the table above.

The acquisition of HubTran during the year ended December 31, 2021 allowed us to create a fully integrated payments network for trucking; servicing brokers and factors. Prior to the HubTran acquisition, our payments platform already offered tools and services to increase automation, mitigate fraud, create back-office efficiency and improve the payment experience. Through the acquisition of HubTran, we created additional value through the enhancement of its presentment, audit, and payment capabilities for third party logistics companies (i.e., freight brokers) and their carriers, and factors. The acquisition of HubTran was a meaningful inflection point in the operations of our payments and audit business as our strategy shifted from a capital-intensive on-balance sheet product with a focus on interest income to an open-loop payments network for the trucking industry with an additional focus on fee revenue. It is for this reason that management believes that earnings before interest, taxes, depreciation, and amortization ("EBITDA") enhance investors' overall understanding of the financial performance of the Payments segment. Further, management's investment in the LoadPay product began in earnest during 2025 and has increased over time. We adjust EBITDA and EBITDA margin at our Payments segment so investors can see returns both inclusive and exclusive of the investments associated with the LoadPay product. Because LoadPay is a relatively new product in its early stages, such adjusted EBITDA measures provide comparable clarity into the performance of our Payments segment prior to the advent of our LoadPay product.

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Intelligence


(Dollars in thousands)	Three Months Ended June 30,
Intelligence	2026		2025		$ Change		% Change
Total interest income	$	—	$	—	$	—	—	%
Intersegment interest allocations	—		—		—		—
Total interest expense	—		—		—		—	%
Net interest income (expense)	—		—		—		—	%
Credit loss expense (benefit)	—		—		—		—	%
Net interest income (expense) after credit loss expense	—		—		—		—	%
Other noninterest income	2,389		1,724		665		38.6	%
Noninterest expense:
Salaries and employee benefits	3,449		3,234		215		6.6	%
Depreciation	18		7		11		157.1	%
Other occupancy, furniture and equipment	13		14		(1)		(7.1)	%
FDIC insurance and other regulatory assessments	—		—		—		—	%
Professional fees	112		2,995		(2,883)		(96.3)	%
Amortization of intangible assets	1,283		946		337		35.6	%
Advertising and promotion	24		22		2		9.1	%
Communications and technology	358		278		80		28.8	%
Software amortization	77		—		77		100.0	%
Travel and entertainment	115		130		(15)		(11.5)	%
Other	269		84		185		220.2	%
Total noninterest expense	5,718		7,710		(1,992)		(25.8)	%
Net income (loss) before income tax expense	$	(3,329)	$	(5,986)	$	2,657	44.4	%


(Dollars in thousands)	Three Months Ended
Intelligence	June 30, 2026
Revenue	$	2,389
Cost of revenue	365
Gross profit	2,024
Selling, general and administrative costs	5,353
Pre-tax operating income (loss)	(3,329)

Gross Margin(1)	85		%

*prior period not meaningful

(1)Gross margin is a non-GAAP financial measure used as supplemental measure to evaluate the performance of our Intelligence segment. Cost of revenues is comprised primarily of salaries and benefits and communications and technology costs for employees providing services to the Company's customers. This includes the costs of the Company's personnel performing integration, customer support, third-party data center and customer training activities. Cost of revenues also includes the direct costs of third party hosting services. We have elected to exclude amortization expense of capitalized developed software and acquired technology, as well as allocations of fixed asset depreciation expense and occupancy expenses from cost of revenues.

Our Intelligence segment's operating loss for the three months ended June 30, 2026 was $3.3 million, compared to an operating loss of $6.0 million for the three months ended June 30, 2025.

Noninterest income at our Intelligence segment increased period over period, primarily due to a full quarter of intelligence fee income in the current period. As previously disclosed, the data intelligence line of business did not have meaningful operations prior to the acquisition of Greenscreens in May 2025.

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Noninterest expense at our Intelligence segment decreased period over period the details of which are illustrated in the table above. A majority of the professional fees recognized at our Intelligence segment during the three months ended June 30, 2025 relate to our acquisition of Greenscreens.

Corporate and Other


(Dollars in thousands)	Three Months Ended June 30,
Corporate and Other	2026		2025		$ Change		% Change
Total interest income	$	33	$	80	$	(47)	(58.8)	%
Intersegment interest allocations	—		—		—		—
Total interest expense	1,628		1,696		(68)		(4.0)	%
Net interest income (expense)	(1,595)		(1,616)		21		1.3	%
Credit loss expense (benefit)	(105)		(97)		(8)		(8.2)	%
Net interest income (expense) after credit loss expense	(1,490)		(1,519)		29		1.9	%
Other noninterest income	885		136		749		550.7	%
Noninterest expense:
Salaries and employee benefits	19,731		18,492		1,239		6.7	%
Depreciation	776		1,602		(826)		(51.6)	%
Other occupancy, furniture and equipment	834		1,603		(769)		(48.0)	%
FDIC insurance and other regulatory assessments	—		—		—		—	%
Professional fees	1,885		1,916		(31)		(1.6)	%
Amortization of intangible assets	11		458		(447)		(97.6)	%
Advertising and promotion	348		367		(19)		(5.2)	%
Communications and technology	2,622		1,887		735		39.0	%
Software amortization	351		327		24		7.3	%
Travel and entertainment	508		482		26		5.4	%
Other	1,070		3,047		(1,977)		(64.9)	%
Total noninterest expense	28,136		30,181		(2,045)		(6.8)	%
Net income (loss) before income tax expense	$	(28,741)	$	(31,564)	$	2,823	8.9	%

Corporate and other is not a reportable segment, but rather includes certain revenue and expense from the Company's holding company as well as activities not allocated to specific business segments. Corporate and other reported an operating loss of $28.7 million for the three months ended June 30, 2026 compared to an operating loss of $31.6 million for the three months ended June 30, 2025.

The decreased operating loss was primarily driven by a decrease in noninterest expense period over period, the details of which are illustrated in the table above. Other noninterest expense for the three months ended June 30, 2025 included $1.8 million of lease termination payments related to the building that had been purchased for the purpose of constructing a future headquarters for Triumph.

Noninterest income for Corporate and other increased period over period due to a $1.8 million payment tied to a change in control provision on the sale of an unrelated third-party business. This gain was partially offset by a $1.0 million loss on a terminated prepaid maintenance agreement.

Results of Operations

Six months ended June 30, 2026 compared with six months ended June 30, 2025

Net Income

We earned net income of $17.7 million for the six months ended June 30, 2026 compared to $4.4 million for the six months ended June 30, 2025, an increase of $13.3 million or 299.5%.

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	Six Months Ended June 30, 2026
(Dollars in thousands, except per share amounts)	2026		2025		$ Change		% Change
Interest income	$	227,292	$	211,471	$	15,821	7.5	%
Interest expense	42,372		38,410		3,962		10.3	%
Net interest income	184,920		173,061		11,859		6.9	%
Credit loss expense (benefit)	2,129		628		1,501		239.0	%
Net interest income after credit loss expense (benefit)	182,791		172,433		10,358		6.0	%
Noninterest income	41,122		36,574		4,548		12.4	%
Noninterest expense	199,895		201,013		(1,118)		(0.6)	%
Net income (loss) before income taxes	24,018		7,994		16,024		200.5	%
Income tax expense (benefit)	6,293		3,557		2,736		76.9	%
Net income (loss)	$	17,725	$	4,437	$	13,288	299.5	%

Details of the changes in the various components of net income are further discussed below.

Net Interest Income

Our operating results depend primarily on our net interest income, which is the difference between interest income on interest earning assets, including loans and securities, and interest expense incurred on interest bearing liabilities, including deposits and other borrowed funds. Interest rate fluctuations, as well as changes in the amount and type of interest earning assets and interest bearing liabilities, combine to affect net interest income. Our net interest income is affected by changes in the amount and mix of interest earning assets and interest bearing liabilities, referred to as a “volume change.” It is also affected by changes in yields earned on interest earning assets and rates paid on interest bearing liabilities, referred to as a “rate change.”

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	Six Months Ended June 30,
	2026						2025
(Dollars in thousands)	Average Balance		Interest		Average Rate(5)		Average Balance		Interest		Average Rate(5)
Interest earning assets:
Cash and cash equivalents	$	667,331	$	12,203	3.69	%	$	390,146	$	8,624	4.46	%
Taxable securities	331,464		8,415		5.12	%	394,247		10,997		5.62	%
Tax-exempt securities	2,277		29		2.57	%	2,541		32		2.54	%
FHLB and other restricted stock	8,736		418		9.65	%	15,833		495		6.30	%
Loans (1)	5,095,647		206,227		8.16	%	4,599,176		191,323		8.39	%
Total interest earning assets	6,105,455		227,292		7.51	%	5,401,943		211,471		7.89	%
Noninterest earning assets:
Cash and cash equivalents	66,647						74,069
Other noninterest earning assets	745,303						705,537
Total assets	$	6,917,405					$	6,181,549
Interest bearing liabilities:
Deposits:
Interest bearing demand(2)	$	680,332	$	13,926	4.13	%	$	727,873	$	1,769	0.49	%
Individual retirement accounts	36,104		221		1.23	%	42,399		265		1.26	%
Money market	635,679		8,021		2.54	%	598,763		7,811		2.63	%
Savings	543,088		3,147		1.17	%	518,879		2,722		1.06	%
Certificates of deposit	221,400		2,756		2.51	%	228,480		3,041		2.68	%
Brokered time deposits	433,679		8,525		3.96	%	591,808		13,038		4.44	%
Other brokered deposits	81,080		1,483		3.69	%	56,810		1,256		4.46	%
Total interest bearing deposits(2)	2,631,362		38,079		2.92	%	2,765,012		29,902		2.18	%
Federal Home Loan Bank advances	56,105		1,049		3.77	%	231,519		5,136		4.47	%
Subordinated notes	69,930		1,325		3.82	%	69,721		1,343		3.88	%
Junior subordinated debentures	43,141		1,919		8.97	%	42,509		2,029		9.63	%

Total interest bearing liabilities	2,800,538		42,372		3.05	%	3,108,761		38,410		2.49	%
Noninterest bearing liabilities and equity:
Noninterest bearing demand deposits	3,073,892						2,086,412
Other liabilities	82,489						80,123
Total equity	960,486						906,253
Total liabilities and equity	$	6,917,405					$	6,181,549
Net interest income			$	184,920					$	173,061
Interest spread (3)					4.46	%					5.40	%
Net interest margin (4)					6.11	%					6.46	%

(1)Balance totals include respective nonaccrual assets.

(2)See discussion below regarding mortgage warehouse clients' noninterest bearing servicing deposits.

(3)Net interest spread is the yield on average interest earning assets less the rate on interest bearing liabilities.

(4)Net interest margin is the ratio of net interest income to average interest earning assets.

(5)Ratios have been annualized.

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The following table presents loan yields earned on our loan portfolios:


	Six Months Ended June 30,
	2026						2025
(Dollars in thousands)	Average Balance		Interest		Average Rate		Average Balance		Interest		Average Rate
Banking	$	3,375,878	$	100,994	6.03	%	$	3,310,204	$	108,360	6.60	%
Factoring	1,425,804		89,110		12.60	%	1,099,854		71,371		13.09	%
Payments	293,965		16,123		11.06	%	189,118		11,593		12.36	%
Total loans	$	5,095,647	$	206,227	8.16	%	$	4,599,176	$	191,324	8.39	%

We earned net interest income of $184.9 million for the six months ended June 30, 2026 compared to $173.1 million for the six months ended June 30, 2025, an increase of $11.8 million, or 6.8%, primarily driven by the following factors.

Interest income increased $15.8 million, or 7.5%, due to changes in average interest earning assets which increased $703.5 million, or 13.0%, including an increase in average total loans of $496.5 million, or 10.8%. The average balance of our higher yielding Factoring factored receivables increased $326.0 million, or 29.6%, and we experienced an increase in average Payments factored receivables. We experienced an increase in average Banking loans of $65.7 million, or 2.0% due to increases in the average balances of residential real estate, commercial, consumer, and mortgage warehouse loans. Interest income from our Banking loans is impacted by our lower yielding mortgage warehouse lending product. The average mortgage warehouse lending balance was $1.099 billion for the six months ended June 30, 2026 compared to $1.003 billion for the six months ended June 30, 2025.

Interest expense increased $4.0 million, or 10.3%, primarily driven by $12.3 million of deposit interest expense incurred in the current period from mortgage warehouse earnings interest rebates that exceeded interest earned on a given client's loans (see detailed discussion of this arrangement below). The impact of the excess mortgage warehouse rebates was partially offset by a decrease in average interest-bearing liabilities period over period, including average total interest bearing deposits which decreased $133.7 million, or 4.8%, and decreased rates on our interest bearing liabilities. Average noninterest bearing deposits grew $987.5 million.

Net interest margin decreased to 6.11% for the six months ended June 30, 2026 from 6.46% for the six months ended June 30, 2025, a decrease of 35 basis points, or 5.4%.

Our average cost of interest bearing liabilities increased by 56 basis points. This increase in average cost was caused by the aforementioned excess mortgage warehouse rebates associated with mortgage warehouse client deposits.

Our mortgage warehouse business is more than self-funded due to the noninterest bearing servicing deposits of its customers. The average balance of such deposits was $1.590 billion and $713.7 million for the six months ended June 30, 2026 and 2025, respectively. Given their legal form, these deposits are classified as noninterest bearing deposits on our balance sheet. Despite their classification, many of these deposits are not truly free of cost as we compensate our clients for these balances in the form of an earnings interest rebate rather than deposit interest. As a result, such noninterest bearing deposits first decrease our loan yield before increasing our deposit rates. Because of the recent influx of these deposits, some clients hold significantly higher deposit balances than loan balances. As a result, we are now, in some cases, paying out more in rebates than we earn in interest on a given client’s loans. In those cases, we are recording that excess rebate as deposit interest expense. Whether recorded as interest expense or an offset to interest income, the effect on net interest income and net income is the same: these are profitable funds as they displace more expensive wholesale funding and can be invested risk-free above their cost. During the six months ended June 30, 2026 and June 30, 2025, deposit interest expense recognized on these deposits was $12.3 million and $0, respectively.

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The following table shows the impact of mortgage warehouse excess rebates:


	Six Months Ended June 30,
	2026
(Dollars in thousands)	Average Balance		Interest		Average Rate(1)
Interest bearing demand deposits	$	680,332	$	13,926	4.13	%
Mortgage warehouse excess rebates	$	680,332	12,342		3.66	%
Interest bearing demand deposits excluding mortgage warehouse excess rebates	$	680,332	$	1,584	0.47	%

Total interest bearing deposits	$	2,631,362	$	38,079	2.92	%
Mortgage warehouse excess rebates	$	2,631,362	12,342		0.95	%
Total interest bearing deposits excluding mortgage warehouse excess rebates	$	2,631,362	$	25,737	1.97	%

(1)Ratios have been annualized.


	Six Months Ended
	June 30, 2026 vs. 2025
	Increase (Decrease) Due to:				Net Increase
(Dollars in thousands)	Rate		Volume
Interest earning assets:
Cash and cash equivalents	$	(1,490)	$	5,069	$	3,579
Taxable securities	(988)		(1,594)		(2,582)
Tax-exempt securities	—		(3)		(3)
FHLB and other restricted stock	263		(340)		(77)
Loans	(5,189)		20,093		14,904
Total interest income	(7,404)		23,225		15,821
Interest bearing liabilities:
Interest bearing demand	13,130		(973)		12,157
Individual retirement accounts	(5)		(39)		(44)
Money market	(256)		466		210
Savings	285		140		425
Certificates of deposit	(197)		(88)		(285)
Brokered time deposits	(1,405)		(3,108)		(4,513)
Other brokered deposits	(217)		444		227
Total interest bearing deposits	11,335		(3,158)		8,177
Federal Home Loan Bank advances	(807)		(3,280)		(4,087)
Subordinated notes	(22)		4		(18)
Junior subordinated debentures	(138)		28		(110)
Other borrowings	—		—		—
Total interest expense	10,368		(6,406)		3,962
Change in net interest income	$	(17,772)	$	29,631	$	11,859

Credit Loss Expense

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The following table presents the major categories of credit loss expense:


	Six Months Ended June 30,
(Dollars in thousands)	2026		2025		$ Change		% Change
Credit loss expense on loans	$	1,867	$	798	$	1,069	134.0	%
Credit loss expense on off balance sheet credit exposures	(110)		(218)		108		49.5	%
Credit loss expense on held to maturity securities	372		48		324		675.0	%
Credit loss expense on available for sale securities	—		—		—		—
Total credit loss expense	$	2,129	$	628	$	1,501	239.0	%

For available for sale debt securities in an unrealized loss position, the Company evaluates the securities at each measurement date to determine whether the decline in the fair value below the amortized cost basis (impairment) is due to credit-related factors or noncredit-related factors. Any impairment that is not credit related is recognized in other comprehensive income, net of applicable taxes. Credit-related impairment is recognized as an ACL on the balance sheet, limited to the amount by which the amortized cost basis exceeds the fair value, with a corresponding adjustment to earnings via credit loss expense. At December 31, 2025 and June 30, 2026, the Company determined that all impaired available for sale securities experienced a decline in fair value below the amortized cost basis due to noncredit-related factors. Therefore, the Company carried no ACL at those respective dates and there was no credit loss expense recognized by the Company during the six months ended June 30, 2026. The same was true for the same period in the prior year.

The ACL on held to maturity securities is estimated at each measurement date on a collective basis by major security type. At June 30, 2026 and December 31, 2025, the Company’s held to maturity securities consisted investments in the subordinated notes of collateralized loan obligation (“CLO”) funds. Expected credit losses for these securities are estimated using a discounted cash flow methodology which considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. At June 30, 2026 and December 31, 2025, the Company carried $3.1 million and $3.2 million of these HTM securities at amortized cost, respectively. The ACL on these balances was $2.1 million at June 30, 2026 and $1.6 million at December 31, 2025. During the six months ended June 30, 2025, the Company charged off one of its three investments in these CLO funds in the amount of $2.2 million. The charge-off was fully reserved in a prior period and as a result, there was no impact to credit loss expense during the six months ended June 30, 2025. We recognized credit loss expense of $0.4 million during the six months ended June 30, 2026. During the six months ended June 30, 2025, we recognized credit loss expense of $48 thousand. None of the overcollateralization triggers tied to the CLO securities were tripped as of June 30, 2026. Ultimately, the realized cash flows on CLO securities such as these will be driven by a variety of factors, including credit performance of the underlying loan portfolio, adjustments to the portfolio by the asset manager, and the timing of a potential call.

Our ACL on loans was $34.8 million as of June 30, 2026, compared to $36.5 million as of December 31, 2025, representing an ACL to total loans ratio of 0.64% and 0.73% respectively.

Our credit loss expense on loans increased $1.1 million, or 134.0%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025.

During the six months ended June 30, 2025, the Company acquired a $23.4 million nonperforming loan for $3.3 million. The loan was purchased credit deteriorated ("PCD") and therefore, a $10.8 million ACL was established on Day 1 resulting in a discount of $9.3 million. Prior to June 30, 2025, the Company determined that the $10.8 million ACL was uncollectible and charged off the entire amount. Such charge-off had no impact on credit loss expense.

The increase in credit loss expense was primarily driven by net charge-off activity. During the six months ended June 30, 2026, we had net charge-offs of $3.6 million. Excluding the $10.8 million charge-off on the acquired PCD loan which had no impact on credit loss expense, we had net charge-offs of $2.8 million during the six months ended June 30, 2025. Such net charge-offs for the six months ended June 30, 2025 includes the aforementioned $3.8 million recovery resulting from the USPS Settlement. Additionally, changes in volume and mix of the loan portfolio resulted in credit loss expense of $3.3 million during the six months ended June 30, 2026 compared to credit loss expense of $1.8 million during the same period a year ago. Further, credit loss expense was impacted by a decrease in required specific reserves. Such specific reserves decreased $1.4 million during the six months ended June 30, 2026 compared to a decrease in specific reserves of $4.1 million during the same period a year ago.

The increase in credit loss expense was partially offset by changes to projected loss drivers and prepayment speeds that the Company forecasted over the reasonable and supportable forecast periods to calculate expected losses resulted in a benefit to credit loss expense of $3.6 million during the six months ended June 30, 2026 compared to $0.3 million of credit loss expense during the same period a year ago.

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Credit loss expense for off balance sheet credit exposures increased $0.1 million, primarily due to changes to outstanding commitments to fund and assumed loss rates period over period.

Noninterest Income

The following table presents our major categories of noninterest income:


	Six Months Ended June 30,
(Dollars in thousands)	2026		2025		$ Change		% Change
Service charges on deposits	$	3,010	$	3,338	$	(328)	(9.8	%)
Card income	4,089		3,719		370		9.9	%

Net gains (losses) on sale of loans	187		324		(137)		(42.3	%)
Net gains (losses) on disposal of premises and equipment	(1,173)		628		(1,801)		(286.8	%)
Fee income	29,262		21,869		7,393		33.8	%
Insurance commissions	2,117		2,532		(415)		(16.4	%)
Other	3,630		4,164		(534)		(12.8	%)
Total noninterest income	$	41,122	$	36,574	$	4,548	12.4	%

Noninterest income increased $4.5 million, or 12.4%. Changes in selected components of noninterest income in the above table are discussed below.

•Net gains (losses) on disposal of premises and equipment. Net gains (losses) on disposal of premises and equipment decreased $1.8 million due to a valuation adjustment on the real estate of a branch we are in the process of closing and a terminated prepaid maintenance agreement.

•Fee income. Fee income increased $7.4 million, or 33.8% due to a $5.7 million increase in fee income from our Payments segment, a $2.7 million increase in fee income from our Intelligence segment mostly driven by the acquisition of Greenscreens during the six months ended June 30, 2025, partially offset by a $1.4 million decrease in fee income from insurance services period over period.

•Other. Other noninterest income decreased $0.5 million, or 12.8%. Other noninterest income for the six months ended June 30, 2026 includes a $1.8 million payment tied to a change in control provision on the sale of an unrelated third-party business. Other noninterest income for the six months ended June 30, 2025 included $1.1 million of rental income generated by the property purchased for the purpose of constructing a future headquarters for Triumph that was subsequently sold in December 2025. There were no other significant changes within the components of other noninterest income.

Noninterest Expense

The following table presents our major categories of noninterest expense:


	Six Months Ended June 30,
(Dollars in thousands)	2026		2025		$ Change		% Change
Salaries and employee benefits	$	118,255	$	118,600	$	(345)	(0.3	%)
Occupancy, furniture and equipment	12,865		16,581		(3,716)		(22.4	%)
FDIC insurance and other regulatory assessments	2,225		1,621		604		37.3	%
Professional fees	11,852		5,744		6,108		106.3	%
Amortization of intangible assets	5,002		5,800		(798)		(13.8	%)
Advertising and promotion	2,617		3,302		(685)		(20.7	%)
Communications and technology	25,069		24,559		510		2.1	%
Software amortization	6,777		4,857		1,920		39.5	%
Travel and entertainment	2,728		3,111		(383)		(12.3	%)
Other	12,505		16,838		(4,333)		(25.7	%)
Total noninterest expense	$	199,895	$	201,013	$	(1,118)	(0.6	%)

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Noninterest expense decreased $1.1 million, or 0.6%. Details of the more significant changes in the various components of noninterest expense are further discussed below.

•Salaries and Employee Benefits. Salaries and employee benefits expenses decreased $0.3 million, or 0.3%. Our average full-time equivalent employees were 1,441.8 and 1,561.8 for the six months ended June 30, 2026 and 2025, respectively. Employee salaries decreased $2.3 million, bonus expense decreased $1.5 million, and temporary labor expense decreased $0.1 million. These decreases were offset by an increase in severance expense of $1.0 million, an increase in commissions expense of $0.3 million, and an increase in employee benefits expense such as 401(k) matching, employee insurance, and stock based compensation paid to employees of $2.5 million.

•Occupancy, Furniture and Equipment. Occupancy, furniture and equipment expenses decreased $3.7 million, or 22.4%, primarily due to a $2.3 million decrease in depreciation expense, a $0.6 million decrease in building property taxes, and a $0.4 million decrease in maintenance and service expenses. All such decreases were primarily driven by the sale of the building in December 2025 that had been purchased for the purpose of constructing a future headquarters for Triumph.

•FDIC Insurance and Other Regulatory Assessments. FDIC insurance and other regulatory assessments increased $0.6 million, or 37.3%, due to increased assessments period over period.

•Professional Fees. Professional fees increased $6.1 million, or 106.3%, primarily due to the recovery of $6.5 million of previously expensed legal fees through the USPS Settlement during the six months ended June 30, 2025 and $2.0 million of non-recurring consulting fees incurred during the six months ended June 30, 2026 related to our ongoing efficiency initiatives. The increase was partially offset by $4.0 million of professional fees incurred during the six months ended June 30, 2025 as a result of the Greenscreens acquisition that did not recur in the current period.

•Amortization of intangible assets. Amortization of intangible assets decreased $0.8 million, or 13.8%, primarily due to $0.6 million of amortization of lease intangible assets recognized during the six months ended June 30, 2025 that did not recur in the current period due to the sale of the building in December 2025 that had been purchased for the purpose of constructing a future headquarters for Triumph.

•Advertising and promotion. Advertising and promotion expenses decreased $0.7 million, or 20.7%, primarily due to a decrease in such activity period over period.

•Communications and Technology. Communications and technology expenses increased $0.5 million, or 2.1%, primarily due to increases in technology license and software maintenance costs, partially offset by a decrease in data processing costs.

•Software amortization. Software amortization increased $1.9 million, or 39.5%, primarily due to additional software assets coming on line.

•Other. Other noninterest expense, which includes loan-related expenses, training and recruiting, postage, insurance, and subscription services, decreased 4.3 million, or 25.7%. Other noninterest expense for the six months ended June 30, 2025 included a $2.0 million litigation settlement (unrelated to the USPS Settlement) and $2.4 million of lease termination payments related to the building we sold in December 2025. There were no other significant changes within the components of other noninterest expense.

Income Taxes

Income tax expense increased $2.7 million, or 76.9%, from $3.6 million for the six months ended June 30, 2025 to $6.3 million for the six months ended June 30, 2026. The effective tax rate was 26% for the six months ended June 30, 2026 and 44% for the six months ended June 30, 2025. The effective tax rate for the six months ended June 30, 2025 was impacted by limited restricted stock stock-based compensation deductibility, higher state tax rates, and higher disallowed expenses including some transaction costs paid in connection with the Greenscreens acquisition.

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Operating Segment Results

The following tables present our primary operating results for our operating segments:


(Dollars in thousands)									Total		Corporate
Six Months Ended June 30, 2026	Banking		Factoring		Payments		Intelligence		Segments		and Other(1)		Consolidated
Total interest income	$	121,992	$	89,110	$	16,123	$	—	$	227,225	$	67	$	227,292
Intersegment interest allocations	14,136		(18,804)		4,668		—		—		—		—
Total interest expense	39,115		13		—		—		39,128		3,244		42,372
Net interest income (expense)	97,013		70,293		20,791		—		188,097		(3,177)		184,920
Credit loss expense (benefit)	(2,368)		3,773		352		—		1,757		372		2,129
Net interest income after credit loss expense	99,381		66,520		20,439		—		186,340		(3,549)		182,791
Noninterest income	11,489		3,835		20,056		4,786		40,166		956		41,122
Noninterest expense:
Salaries and employee benefits	29,658		24,293		18,545		6,666		79,162		39,093		118,255
Depreciation	3,117		561		332		34		4,044		1,602		5,646
Other occupancy, furniture and equipment	4,144		959		304		40		5,447		1,772		7,219
FDIC insurance and other regulatory assessments	2,225		—		—		—		2,225		—		2,225
Professional fees	6,680		713		534		241		8,168		3,684		11,852
Amortization of intangible assets	538		248		1,629		2,566		4,981		21		5,002
Advertising and promotion	671		644		529		118		1,962		655		2,617
Communications and technology	8,502		4,779		5,942		717		19,940		5,129		25,069
Software amortization	—		2,187		3,753		135		6,075		702		6,777
Travel and entertainment	439		386		512		261		1,598		1,130		2,728
Other	6,356		1,237		2,399		340		10,332		2,173		12,505
Total noninterest expense	62,330		36,007		34,479		11,118		143,934		55,961		199,895
Net intersegment noninterest income (expense)(2)	269		1,033		(1,302)		—		—		—		—
Net income (loss) before income tax expense	$	48,809	$	35,381	$	4,714	$	(6,332)	$	82,572	$	(58,554)	$	24,018

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(Dollars in thousands)									Total		Corporate
Six Months Ended June 30, 2025	Banking		Factoring		Payments		Intelligence		Segments		and Other(1)		Consolidated
Total interest income	$	128,344	$	71,371	$	11,593	$	—	$	211,308	$	163	$	211,471
Intersegment interest allocations	11,121		(16,935)		5,814		—		—		—		—
Total interest expense	35,036		2		—		—		35,038		3,372		38,410
Net interest income (expense)	104,429		54,434		17,407		—		176,270		(3,209)		173,061
Credit loss expense (benefit)	2,726		(2,356)		210		—		580		48		628
Net interest income after credit loss expense	101,703		56,790		17,197		—		175,690		(3,257)		172,433
Noninterest income	14,992		3,530		14,255		2,119		34,896		1,678		36,574
Noninterest expense:
Salaries and employee benefits	32,318		26,666		18,324		4,718		82,026		36,574		118,600
Depreciation	3,286		971		452		14		4,723		3,176		7,899
Other occupancy, furniture and equipment	3,998		1,045		331		21		5,395		3,287		8,682
FDIC insurance and other regulatory assessments	1,621		—		—		—		1,621		—		1,621
Professional fees	2,866		(5,420)		446		3,946		1,838		3,906		5,744
Amortization of intangible assets	770		386		2,969		1,062		5,187		613		5,800
Advertising and promotion	1,068		477		1,050		52		2,647		655		3,302
Communications and technology	10,272		4,712		4,924		505		20,413		4,146		24,559
Software amortization	56		1,719		2,609		2		4,386		471		4,857
Travel and entertainment	544		428		833		248		2,053		1,058		3,111
Other	6,235		3,511		2,019		150		11,915		4,923		16,838
Total noninterest expense	63,034		34,495		33,957		10,718		142,204		58,809		201,013
Net intersegment noninterest income (expense)(2)	292		848		(1,140)		—		—		—		—
Net income (loss) before income tax expense	$	53,953	$	26,673	$	(3,645)	$	(8,599)	$	68,382	$	(60,388)	$	7,994

(1) Includes revenue and expense from the Company’s holding company, which does not meet the definition of an operating segment. Also includes corporate shared service costs such as the majority of salaries and benefits expense for our executive leadership team, as well as other selling, general, and administrative shared services costs including human resources, accounting, finance, risk management and a significant amount of information technology expense.

(2) Net intersegment noninterest income (expense) includes:


(Dollars in thousands)	Banking		Factoring		Payments
Six Months Ended June 30, 2026
Factoring revenue received from Payments	$	—	$	1,821	$	(1,821)
Payments revenue received from Factoring	—		(553)		553
Banking revenue received from Payments and Factoring	$	269	$	(235)	$	(34)
Net intersegment noninterest income (expense)	$	269	$	1,033	$	(1,302)

Six Months Ended June 30, 2025
Factoring revenue received from Payments	$	—	$	1,821	$	(1,821)
Payments revenue received from Factoring	—		(753)		753
Banking revenue received from Payments and Factoring	$	292	$	(220)	$	(72)
Net intersegment noninterest income (expense)	$	292	$	848	$	(1,140)


(Dollars in thousands)									Total		Corporate
June 30, 2026	Banking		Factoring		Payments		Intelligence		Segments		and Other		Eliminations		Consolidated
Total assets	$	4,820,467	$	1,821,671	$	838,251	$	111,973	$	7,592,362	$	1,123,430	$	(1,312,107)	$	7,403,685
Gross loans	$	3,337,212	$	1,752,492	$	387,387	$	—	$	5,477,091	$	—	$	—	$	5,477,091

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(Dollars in thousands)									Total		Corporate
December 31, 2025	Banking		Factoring		Payments		Intelligence		Segments		and Other		Eliminations		Consolidated
Total assets	$	4,480,124	$	1,335,150	$	774,979	$	120,410	$	6,710,663	$	1,088,885	$	(1,418,960)	$	6,380,588
Gross loans	$	3,525,447	$	1,223,740	$	242,120	$	—	$	4,991,307	$	—	$	—	$	4,991,307

Banking


(Dollars in thousands)	Six Months Ended June 30,
Banking	2026		2025		$ Change		% Change
Total interest income	$	121,992	$	128,344	$	(6,352)	(4.9	%)
Intersegment interest allocations	14,136		11,121		3,015		27.1	%
Total interest expense	39,115		35,036		4,079		11.6	%
Net interest income	97,013		104,429		(7,416)		(7.1	%)
Credit loss expense (benefit)	(2,368)		2,726		(5,094)		(186.9	%)
Net interest income after credit loss expense	99,381		101,703		(2,322)		(2.3	%)
Noninterest income	11,489		14,992		(3,503)		(23.4	%)
Noninterest expense:
Salaries and employee benefits	29,658		32,318		(2,660)		(8.2	%)
Depreciation	3,117		3,286		(169)		(5.1	%)
Other occupancy, furniture and equipment	4,144		3,998		146		3.7	%
FDIC insurance and other regulatory assessments	2,225		1,621		604		37.3	%
Professional fees	6,680		2,866		3,814		133.1	%
Amortization of intangible assets	538		770		(232)		(30.1	%)
Advertising and promotion	671		1,068		(397)		(37.2	%)
Communications and technology	8,502		10,272		(1,770)		(17.2	%)
Software amortization	—		56		(56)		(100.0	%)
Travel and entertainment	439		544		(105)		(19.3	%)
Other	6,356		6,235		121		1.9	%
Total noninterest expense	62,330		63,034		(704)		(1.1	%)
Net intersegment noninterest income (expense)	269		292		(23)		(7.9	%)
Net income (loss) before income tax expense	$	48,809	$	53,953	$	(5,144)	(9.5	%)

Our Banking segment’s operating income decreased $5.1 million, or 9.5%.

Total interest income decreased $6.4 million, or 4.9%, at our Banking segment primarily as a result of decreased yields at our Banking segment in spite of increased average balances of interest earning assets. While average loans in our Banking segment, excluding intersegment loans, increased 2.0% from $3.310 billion for the six months ended June 30, 2025 to $3.376 billion for the six months ended June 30, 2026, this increase was partially offset by decreased yields. Outside of loans, the majority of the categories of interest earning assets at our Banking segment experienced decreased yields and the average cash and cash equivalents balance increased period over period as a result of increased noninterest bearing deposit balances.

Interest expense increased $4.1 million, or 11.6%, primarily driven by $12.3 million of deposit interest expense from mortgage warehouse earnings interest rebates that exceeded interest earned on a given client's loans, partially offset by lower average balances and decreased rates on our interest bearing liabilities. Average total interest bearing deposits decreased $133.7 million, or 4.8% and average FHLB borrowings decreased $175.4 million, or 75.8%.

Credit loss expense at our Banking segment is made up of credit loss expense related to loans and credit loss expense related to off balance sheet commitments to lend. Credit loss expense related to loans at our Banking segment was a benefit of $2.3 million for the six months ended June 30, 2026 compared to credit loss expense on loans of $2.9 million for the six months ended June 30, 2025. The decrease in credit loss expense was the result of decreased net charge-offs at our banking segment, a decrease driven by changes to the projected loss drivers and prepayment speeds that the Company forecasted over the reasonable and supportable forecast periods, and a decrease driven by changes in the volume and mix of our Banking segment's loan portfolio period over period. The decrease in credit loss expense was partially offset by an increase in required specific reserves at our Banking segment period over period.

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Credit loss expense for off balance sheet credit exposures increased $0.1 million from a benefit to credit loss expense of $0.2 million for the six months ended June 30, 2025 to a benefit of $0.1 million for the six months ended June 30, 2026, primarily due to changes to outstanding commitments to fund and assumed loss rates period over period.

Noninterest income at our Banking segment decreased period over period due to a $1.5 million decrease in fee income, a $0.5 million decrease in noninterest income on loans, and a $0.4 million decrease of insurance commissions at our Banking segment.

Noninterest expense at our Banking segment decreased period over period the details of which are illustrated in the table above. For the six months ended June 30, 2026, professional fees, a component of noninterest expense, at our Banking segment includes $2.0 million of non-recurring consulting fees incurred related to our ongoing efficiency initiatives.

During the six months ended June 30, 2026, the aggregate outstanding balances of our banking products decreased $188.2 million, or 5.3%, to $3.337 billion as of June 30, 2026. See the Financial Condition section below for further discussion of changes in loan balances:


(Dollars in thousands)	June 30, 2026		December 31, 2025		$ Change		% Change
Banking
Commercial real estate	$	667,520	$	730,435	$	(62,915)	(8.6	%)
Construction, land development, land	192,091		224,214		(32,123)		(14.3	%)
1-4 family residential	205,540		193,508		12,032		6.2	%
Farmland	42,909		43,433		(524)		(1.2	%)
Commercial - General	322,969		313,696		9,273		3.0	%
Commercial - Agriculture	51,130		42,588		8,542		20.1	%
Commercial - Equipment	621,884		587,926		33,958		5.8	%
Commercial - Asset-based lending	123,053		180,012		(56,959)		(31.6	%)
Commercial - Liquid Credit	37,091		36,482		609		1.7	%
Consumer	16,715		16,819		(104)		(0.6	%)
Mortgage Warehouse	1,056,310		1,156,334		(100,024)		(8.7	%)
Total banking loans	$	3,337,212	$	3,525,447	$	(188,235)	(5.3	%)

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Factoring


(Dollars in thousands)	Six Months Ended June 30,
Factoring	2026		2025		$ Change		% Change
Total interest income	$	89,110	$	71,371	$	17,739	24.9	%
Intersegment interest allocations	(18,804)		(16,935)		(1,869)		(11.0	%)
Total interest expense	13		2		11		550.0	%
Net interest income	70,293		54,434		15,859		29.1	%
Credit loss expense (benefit)	3,773		(2,356)		6,129		260.1	%
Net interest income after credit loss expense	66,520		56,790		9,730		17.1	%
Noninterest income	3,835		3,530		305		8.6	%
Noninterest expense:
Salaries and employee benefits	24,293		26,666		(2,373)		(8.9	%)
Depreciation	561		971		(410)		(42.2	%)
Other occupancy, furniture and equipment	959		1,045		(86)		(8.2	%)
FDIC insurance and other regulatory assessments	—		—		—		—	%
Professional fees	713		(5,420)		6,133		113.2	%
Amortization of intangible assets	248		386		(138)		(35.8	%)
Advertising and promotion	644		477		167		35.0	%
Communications and technology	4,779		4,712		67		1.4	%
Software amortization	2,187		1,719		468		27.2	%
Travel and entertainment	386		428		(42)		(9.8	%)
Other	1,237		3,511		(2,274)		(64.8	%)
Total noninterest expense	36,007		34,495		1,512		4.4	%
Net intersegment noninterest income (expense)	1,033		848		185		21.8	%
Net income (loss) before income tax expense	$	35,381	$	26,673	$	8,708	32.6	%

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	Six Months Ended June 30,
	2026			2025
Factored receivable period end balance	$	1,748,491,000		$	1,174,830,000
Commercial loans period end balance	$	4,001,000		$	2,593,000
Yield on average receivable balance	12.60		%	13.09		%
Year to date charge-off rate	0.13		%	(0.09)		%
Factored receivables - transportation concentration	97		%	96		%

Interest income, including fees	$	89,110,000		$	71,371,000
Noninterest income	3,835,000			3,530,000
Intersegment noninterest income	1,821,000			1,821,000
Factored receivable total revenue	94,766,000			76,722,000
Average net funds employed	1,351,571,000			1,007,223,000
Yield on average net funds employed	14.14		%	15.36		%

Operating income (loss)	$	35,381,000		$	26,673,000
Factoring total revenue	$	94,766,000		$	76,722,000
Operating margin(1)	37.34		%	34.77		%

Accounts receivable purchased	$	7,379,820,000		$	5,581,464,000
Number of invoices purchased	3,554,098			3,195,495
Average invoice size	$	2,076		$	1,747
Average invoice size - transportation	$	2,035		$	1,713
Average invoice size - non-transportation	$	5,942		$	3,830

(1)Operating margin is a non-GAAP financial measure used as a supplemental measure to evaluate the performance of our Factoring segment. It provides meaningful supplemental information regarding the segment's operational performance and enhances investors' overall understanding of the Factoring segment's profitability and operational efficiency. For the six months ended June 30, 2025, operating income and factoring total revenue were impacted by $1.2 million of interest and fees resulting from the USPS Settlement and such settlement further impacted operating income by $6.5 million of legal expense accrual reversal and $3.8 million of recovery of factoring balances charged off in a prior period. Operating income was also impacted by a $2.0 million legal settlement that was unrelated to the USPS Settlement. Such items had a 12.00% impact on operating margin, a 0.23% impact on yield on average receivables, and a 0.24% impact on yield on average net funds employed for the six months ended June 30, 2025.

(2)The current period charge-off rate for the six months ended June 30, 2025 reflects a $3.8 million recovery of factoring balances charged off in a prior period. Such recovery impacted the current quarter charge-off rate for that period by (0.34%).

Our Factoring segment’s operating income increased $8.7 million, or 32.6%.

Our average invoice size increased 18.8% from $1,747 for the six months ended June 30, 2025 to $2,076 for the six months ended June 30, 2026. This increase is the result of a broad increase in transportation invoice prices across the industry as capacity exits and rising fuel costs began to impact pricing. Additionally, the number of invoices purchased increased 11.2% period over period.

Net interest income at our Factoring segment increased period over period. Overall average net funds employed (“NFE”) increased 34.2% during the six months ended June 30, 2026 compared to the same period in 2025. The increase in average NFE was the result of increased invoice purchase volume and increased average invoice sizes. See further discussion under the Recent Developments: Transportation Update section. We maintained high concentration in transportation factoring balances, which typically generate a higher yield than our non-transportation factoring balances. This concentration was at 96% at June 30, 2025 and 97% at June 30, 2026. Net interest income at our Factoring segment was also impacted by an increase in its intersegment interest allocation charge period over period driven by higher average Factoring balances and partially offset by lower intercompany rates consistent with lower rates in the broader macro economy period over period.

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Credit loss expense at our Factoring segment is made up of credit loss expense related to factored receivables and loans at our Factoring segment as well as credit loss expense related to off balance sheet commitments to lend to the extent there are any such commitments. Credit loss expense related to factored receivables and loans was $3.8 million for the six months ended June 30, 2026 compared to a benefit of $2.4 million for the six months ended June 30, 2025. The increase in credit loss expense at our Factoring segment was driven by increased net charge-offs period over period as the period from the prior year reflects the $3.8 million recovery resulting from the USPS settlement. The increase was also driven by changes in volume and mix of the portfolio period over period and increased required specific reserves at our Factoring segment period over period. These increases were partially offset by a small decrease driven by changes in rate period over period at our Factoring segment.

There was no credit loss expense for off balance sheet credit exposures for the six months ended June 30, 2025 and June 30, 2026 as there were no commitments to lend during either period.

The increase in noninterest income at our Factoring segment was driven by an increase in fee income period over period. There were no other significant variances in noninterest income at our Factoring segment.

Noninterest expense at our Factoring segment increased period over period the details of which are illustrated in the table above. For the six months ended June 30, 2025, professional fees, a component of noninterest expense, at our Factoring segment reflect a $6.5 million recovery of previously expensed legal fees associated with the USPS Settlement. Other noninterest expense at our Factoring segment for the six months ended June 30, 2025 included $2.0 million of expense driven by settlement of litigation unrelated to the USPS Settlement.

Payments


(Dollars in thousands)	Six Months Ended June 30,
Payments	2026		2025		$ Change		% Change
Total interest income	$	16,123	$	11,593	$	4,530	39.1	%
Intersegment interest allocations	4,668		5,814		(1,146)		(19.7)	%
Total interest expense	—		—		—		—	%
Net interest income	20,791		17,407		3,384		19.4	%
Credit loss expense (benefit)	352		210		142		67.6	%
Net interest income after credit loss expense	20,439		17,197		3,242		18.9	%
Noninterest income	20,056		14,255		5,801		40.7	%
Noninterest expense:
Salaries and employee benefits	18,545		18,324		221		1.2	%
Depreciation	332		452		(120)		(26.5)	%
Other occupancy, furniture and equipment	304		331		(27)		(8.2)	%
FDIC insurance and other regulatory assessments	—		—		—		—	%
Professional fees	534		446		88		19.7	%
Amortization of intangible assets	1,629		2,969		(1,340)		(45.1)	%
Advertising and promotion	529		1,050		(521)		(49.6)	%
Communications and technology	5,942		4,924		1,018		20.7	%
Software amortization	3,753		2,609		1,144		43.8	%
Travel and entertainment	512		833		(321)		(38.5)	%
Other	2,399		2,019		380		18.8	%
Total noninterest expense	34,479		33,957		522		1.5	%
Net intersegment noninterest income (expense)	(1,302)		(1,140)		(162)		(14.2)	%
Net income (loss) before income tax expense	$	4,714	$	(3,645)	$	8,359	229.3	%

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	Six Months Ended
	2026			2025
Supply chain financing factored receivables	$	287,454,000		$	152,054,000
QuickPay factored receivables	99,933,000			74,493,000
Factored receivable period end balance	$	387,387,000		$	226,547,000

Supply chain finance interest income	$	9,868,000		$	6,107,000
QuickPay interest income	6,255,000			5,486,000
Intersegment interest income	4,668,000			5,814,000
Total interest income	20,791,000			17,407,000
Broker fee income	17,356,000			11,621,000
Factor fee income	1,426,000			2,226,000
Other noninterest income	1,274,000			408,000
Intersegment noninterest income	553,000			753,000
Total noninterest income	20,609,000			15,008,000
Total revenue	$	41,400,000		$	32,415,000

Credit loss expense (benefit)	352,000			210,000
Noninterest expense	34,479,000			33,957,000
Intersegment noninterest expense	1,855,000			1,893,000
Total expense	36,686,000			36,060,000

Operating income (loss)	$	4,714,000		$	(3,645,000)
Depreciation expense	332,000			452,000
Software amortization expense	3,753,000			2,609,000
Intangible amortization expense	1,629,000			2,969,000
Earnings (losses) before interest, taxes, depreciation, and amortization	$	10,428,000		$	2,385,000



EBITDA margin(1)	25.2		%	7.4		%

Number of invoices processed	17,306,771			15,682,609
Amount of payments processed	$	24,506,277,000		$	18,859,031,000
Network invoice volume	2,089,125			1,724,134
Network payment volume	$	4,218,424,000		$	2,747,126,000

LoadPay
Revenue	$	1,089,000		$	116,000
Pre-tax operating income (loss)	$	(4,111,000)		$	(2,804,000)
Depreciation expense	44,000			19,000
Software amortization expense	790,000			391,000
Earnings (losses) before interest, taxes, depreciation, and amortization(1)	$	(3,277,000)		$	(2,394,000)

Payments revenue excluding LoadPay	$	40,311,000		$	32,299,000
Payments EBITDA excluding LoadPay(2)	$	13,705,000		$	4,779,000
Payments EBITDA Margin excluding LoadPay(2)	34.0		%	14.8		%

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Our Payments segment's operating income was $4.7 million for the six months ended June 30, 2026 compared to an operating loss of $3.6 million for the six months ended June 30, 2025, an increase of $8.4 million, or 229.3%.

The number of invoices processed by our Payments segment increased 10.4% from 15,682,609 for the six months ended June 30, 2025 to 17,306,771 for the six months ended June 30, 2026, and the amount of payments processed increased 29.9% from $18.859 billion for the six months ended June 30, 2025 to $24.506 billion for the six months ended June 30, 2026.

We began processing network transactions during the first quarter of 2022. When a fully integrated payments customer payor receives an invoice from a fully integrated payments customer payee, we call that a “network transaction.” All network transactions are included in our payment processing volume above. These transactions are facilitated through payments platform APIs with parties on both sides of the transaction using structured data; similar to how a credit card works at a point-of-sale terminal. The integrations largely automate the process and make it cheaper, faster and safer. During the six months ended June 30, 2026, we processed 2,089,125 network invoices representing a network payment volume of $4.218 billion. During the six months ended June 30, 2025, we processed 1,724,134 network invoices representing a network payment volume of $2.747 billion.

Noninterest income increased due to a $5.7 million increase in fee income earned from our payment processing and audit business during the six months ended June 30, 2026 compared to the same period a year ago. There were no other significant changes in the components of noninterest income at our Payments segment period over period.

Noninterest expense at our Payments segment was relatively flat period over period the details of which are illustrated in the table above.

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Intelligence


(Dollars in thousands)	Six Months Ended June 30,
Intelligence	2026		2025		$ Change		% Change
Total interest income	$	—	$	—	$	—	—	%
Intersegment interest allocations	—		—		—		—
Total interest expense	—		—		—		—	%
Net interest income (expense)	—		—		—		—	%
Credit loss expense (benefit)	—		—		—		—	%
Net interest income (expense) after credit loss expense	—		—		—		—	%
Noninterest income	4,786		2,119		2,667		125.9	%
Noninterest expense:
Salaries and employee benefits	6,666		4,718		1,948		41.3	%
Depreciation	34		14		20		142.9	%
Other occupancy, furniture and equipment	40		21		19		90.5	%
FDIC insurance and other regulatory assessments	—		—		—		—	%
Professional fees	241		3,946		(3,705)		(93.9)	%
Amortization of intangible assets	2,566		1,062		1,504		141.6	%
Advertising and promotion	118		52		66		126.9	%
Communications and technology	717		505		212		42.0	%
Software amortization	135		2		133		6,650.0	%
Travel and entertainment	261		248		13		5.2	%
Other	340		150		190		126.7	%
Total noninterest expense	11,118		10,718		400		3.7	%
Net income (loss) before income tax expense	$	(6,332)	$	(8,599)	$	2,267	26.4	%


(Dollars in thousands)	Six Months Ended
Intelligence	June 30, 2026
Revenue	$	4,786
Cost of revenue	698
Gross profit	4,088
Selling, general and administrative costs	10,420
Pre-tax operating income (loss)	(6,332)

Gross Margin(1)	85		%

*prior period not meaningful

Our Intelligence segment's operating loss for the six months ended June 30, 2026 was $6.3 million compared to an operating loss of $8.6 million for the six months ended June 30, 2025. Noninterest income at our Intelligence segment increased period over period, primarily due to a full period of intelligence fee income for the six months ended June 30, 2026. As previously disclosed, the data intelligence line of business did not have meaningful operations prior to the acquisition of Greenscreens in May 2025.

Noninterest expense at our Intelligence segment increased period over period the details of which are illustrated in the table above. A majority of the professional fees recognized at our Intelligence segment during the six months ended June 30, 2025 relate to our acquisition of Greenscreens.

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Corporate and Other


(Dollars in thousands)	Six Months Ended June 30,						% Change
Corporate and Other	2026		2025		$ Change
Total interest income	$	67	$	163	$	(96)	(58.9	%)
Intersegment interest allocations	—		—		—		—
Total interest expense	3,244		3,372		(128)		(3.8	%)
Net interest income (expense)	(3,177)		(3,209)		32		1.0	%
Credit loss expense (benefit)	372		48		324		675.0	%
Net interest income (expense) after credit loss expense	(3,549)		(3,257)		(292)		(9.0	%)
Noninterest income	956		1,678		(722)		(43.0	%)
Noninterest expense:
Salaries and employee benefits	39,093		36,574		2,519		6.9	%
Depreciation	1,602		3,176		(1,574)		(49.6	%)
Other occupancy, furniture and equipment	1,772		3,287		(1,515)		(46.1	%)
FDIC insurance and other regulatory assessments	—		—		—		—	%
Professional fees	3,684		3,906		(222)		(5.7	%)
Amortization of intangible assets	21		613		(592)		(96.6	%)
Advertising and promotion	655		655		—		—	%
Communications and technology	5,129		4,146		983		23.7	%
Software amortization	702		471		231		49.0	%
Travel and entertainment	1,130		1,058		72		6.8	%
Other	2,173		4,923		(2,750)		(55.9	%)
Total noninterest expense	55,961		58,809		(2,848)		(4.8	%)
Net income (loss) before income tax expense	$	(58,554)	$	(60,388)	$	1,834	3.0	%

Corporate and other is not a reportable segment, but rather includes certain revenue and expense from the Company's holding company as well as activities not allocated to specific business segments. Corporate and other reported an operating loss of $58.6 million for the six months ended June 30, 2026 compared to an operating loss of $60.4 million for the six months ended June 30, 2025.

The decreased operating loss was driven by decreased noninterest expense, the details of which are illustrated in the table above. Other noninterest expense for the six months ended June 30, 2025 included $2.4 million of lease termination payments related to the building that had been purchased for the purpose of constructing a future headquarters for Triumph.

Noninterest income for Corporate and other for the six months ended June 30, 2026 includes a $1.8 million payment tied to a change in control provision on the sale of an unrelated third-party business. This gain was partially offset by a $1.0 million loss on a terminated prepaid maintenance agreement during the current period. Noninterest income for the six months ended June 30, 2025 included $1.1 million of rental income related to the building that had been purchased for the purpose of constructing a future headquarters for Triumph that did not repeat in the current period.

Financial Condition

Assets

Total assets were $7.404 billion at June 30, 2026, compared to $6.381 billion at December 31, 2025, an increase of $1,023.1 million, the components of which are discussed below.

Loan Portfolio

Loans held for investment were $5.477 billion at June 30, 2026, compared with $4.991 billion at December 31, 2025.

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The following table shows our total loan portfolio by portfolio segments:


	June 30, 2026				December 31, 2025				$ Change		% Change
(Dollars in thousands)			% of Total				% of Total
Commercial real estate	$	667,520	12	%	$	730,435	15	%	$	(62,915)	(8.6	%)
Construction, land development, land	192,091		4	%	224,214		4	%	(32,123)		(14.3	%)
1-4 family residential	205,540		4	%	193,508		4	%	12,032		6.2	%
Farmland	42,909		1	%	43,433		1	%	(524)		(1.2	%)
Commercial	1,160,128		21	%	1,163,664		24	%	(3,536)		(0.3	%)
Factored receivables	2,135,878		39	%	1,462,900		29	%	672,978		46.0	%
Consumer	16,715		—	%	16,819		—	%	(104)		(0.6	%)
Mortgage warehouse	1,056,310		19	%	1,156,334		23	%	(100,024)		(8.7	%)
Total Loans	$	5,477,091	100	%	$	4,991,307	100	%	$	485,784	9.7	%

Commercial Real Estate Loans. Our commercial real estate loans decreased $62.9 million, or 8.6%, due to paydowns that outpaced new origination activity. A significant portion of our loan portfolio at June 30, 2026 consisted of commercial real estate loans secured by properties. Such loans can involve high principal loan amounts, and the repayment of these loans is dependent, in large part, on a borrower's ongoing business operations or on income generated from the properties. The table below sets forth the Company's commercial real estate loan portfolio, by portfolio industry sector and collateral location as of June 30, 2026.


(Dollars in thousands)	Illinois		New York		Texas		Colorado		New Jersey		Iowa		Other		Total
Non-owner occupied
Office	$	669	$	35,868	$	46,170	$	385	$	82,307	$	153	$	4,593	$	170,145
Multifamily	10,693		—		5,946		7,381		—		147		105,075		129,242
Retail	3,002		27,436		—		6,644		—		2,146		20,329		59,557
Industrial	6,403		33,593		1,747		876		—		844		6,084		49,547
Hospitality	884		—		—		1,422		—		—		32,079		34,385
Other	8,862		2,547		3,424		5,510		—		1,492		19,946		41,781
	30,513		99,444		57,287		22,218		82,307		4,782		188,106		484,657
Owner occupied
Industrial	17,387		—		2,331		5,778		—		18,621		15,600		59,717
Hospitality	2,871		—		—		2,461		—		—		—		5,332
Restaurant	16,194		—		—		2,785		—		1,339		1,537		21,855
Retail	1,581		—		—		8,039		—		46		498		10,164
Office	4,598		106		—		5,981		—		548		341		11,574
Other	3,943		—		—		13,232		—		34,803		22,243		74,221
	46,574		106		2,331		38,276		—		55,357		40,219		182,863
Total commercial real estate	$	77,087	$	99,550	$	59,618	$	60,494	$	82,307	$	60,139	$	228,325	$	667,520

Construction and Development Loans. Our construction and development loans decreased $32.1 million, or 14.3%, due to paydowns and conversions to term loans that outpaced origination and draw activity.

Residential Real Estate Loans. Our one-to-four family residential loans increased $12.0 million, or 6.2%, due to modest origination activity that outpaced paydowns.

Farmland Loans. Our farmland loans decreased $0.5 million, or 1.2%, due to paydowns that outpaced modest origination activity.

Commercial Loans. Our commercial loans held for investment decreased $3.5 million, or 0.3%, due to decreased asset based lending. During the fourth quarter of 2025, we made the decision to cease new originations in our asset-based loan portfolio and to begin winding down its operations during 2026. This decrease was partially offset by increases in equipment lending, other commercial lending, and agriculture lending. Our other commercial lending products, comprised primarily of general commercial loans originated in our community banking markets, increased $10.3 million, or 3.3%.

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The following table shows our commercial loans:


(Dollars in thousands)	June 30, 2026		December 31, 2025		$ Change		% Change
Commercial
Equipment	$	621,884	$	587,926	$	33,958	5.8	%
Asset-based lending	123,053		180,012		(56,959)		(31.6	%)
Liquid credit	37,091		36,482		609		1.7	%
Agriculture	51,130		42,588		8,542		20.1	%
Other commercial lending	326,970		316,656		10,314		3.3	%
Total commercial loans	$	1,160,128	$	1,163,664	$	(3,536)	(0.3	%)

Factored Receivables. Our factored receivables increased $673.0 million, or 46.0%. See discussion of our Factoring segment in the Operating Segment Results for analysis of the key drivers impacting the change in the ending factored receivables balance during the period.

Consumer Loans. Our consumer loans decreased $0.1 million, or 0.6%, due to paydowns that outpaced origination activity during the period.

Mortgage Warehouse. Our mortgage warehouse facilities decreased $100.0 million, or 8.7%, due to seasonal changes in utilization. Client utilization of mortgage warehouse facilities may experience significant fluctuation on a day-to-day basis given mortgage origination market conditions. Our average mortgage warehouse lending balance was $1.110 billion for the six months ended June 30, 2026 compared to $1.068 billion for the six months ended June 30, 2025.

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The following tables set forth the contractual maturities, including scheduled principal repayments, of our loan portfolio and the distribution between fixed and floating interest rate loans:


	June 30, 2026
(Dollars in thousands)	One Year or Less		After One but within Five Years		After Five but within Fifteen Years		After Fifteen Years		Total
Commercial real estate	$	347,617	$	269,942	$	49,929	$	32	$	667,520
Construction, land development, land	55,981		127,324		1,482		7,304		192,091
1-4 family residential	10,487		15,259		5,441		174,353		205,540
Farmland	4,087		27,504		10,580		738		42,909
Commercial	406,514		710,150		43,464		—		1,160,128
Factored receivables	2,135,878		—		—		—		2,135,878
Consumer	10,890		5,419		399		7		16,715
Mortgage warehouse	1,056,310		—		—		—		1,056,310
	$	4,027,764	$	1,155,598	$	111,295	$	182,434	$	5,477,091

Sensitivity of loans to changes in interest rates:			After One but within Five Years		After Five but within Fifteen Years		After Fifteen Years
Predetermined (fixed) interest rates
Commercial real estate			$	211,507	$	1,570	$	—
Construction, land development, land			59,312		344		—
1-4 family residential			11,855		1,695		90,207
Farmland			23,114		286		—
Commercial			636,331		18,683		—
Factored receivables			—		—		—
Consumer			5,419		399		7
Mortgage warehouse			—		—		—
			$	947,538	$	22,977	$	90,214
Floating interest rates
Commercial real estate			$	58,435	$	48,359	$	32
Construction, land development, land			68,012		1,138		7,304
1-4 family residential			3,404		3,746		84,146
Farmland			4,390		10,294		738
Commercial			73,819		24,781		—
Factored receivables			—		—		—
Consumer			—		—		—
Mortgage warehouse			—		—		—
			$	208,060	$	88,318	$	92,220

Total			$	1,155,598	$	111,295	$	182,434

As of June 30, 2026, most of the Company’s non-factoring business activity is with customers located within certain states. The states of Texas (20%), Illinois (12%), Colorado (10%), and Iowa (4%) make up 46% of the Company’s gross loans, excluding factored receivables. Therefore, the Company’s exposure to credit risk is affected by changes in the economies in these states. At December 31, 2025, the states of Texas (20%), Illinois (10%), Colorado (10%), and Iowa (4%) made up 44% of the Company’s gross loans, excluding factored receivables.

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Further, a majority (97%) of our factored receivables, representing approximately 38% of our total loan portfolio as of June 30, 2026, are receivables purchased from trucking fleets, owner-operators, and freight brokers in the transportation industry. Although such concentration may cause our future interest income with respect to our factoring operations to be correlated with demand for the transportation industry in the United States generally, we feel that the credit risk with respect to our outstanding portfolio is appropriately mitigated as we limit the amount of receivables acquired from individual debtors and creditors thereby achieving diversification across a number of companies and industries. At December 31, 2025, 97% of our factored receivables, representing approximately 29% of our total loan portfolio, were receivables purchased from trucking fleets, owner-operators, and freight brokers in the transportation industry.

Nonperforming Assets

We have established procedures to assist us in maintaining the overall quality of our loan portfolio. In addition, we have adopted underwriting guidelines to be followed by our lending officers and require senior management review of proposed extensions of credit exceeding certain thresholds. When delinquencies exist, we monitor them for any negative or adverse trends. Our loan review procedures include approval of lending policies and underwriting guidelines by the board of directors of our bank subsidiary, independent loan review, approval of large credit relationships by our bank subsidiary’s Management Loan Committee and loan quality documentation procedures. We, like other financial institutions, are subject to the risk that our loan portfolio will be subject to increasing pressures from deteriorating borrower credit due to general economic conditions.

To manage the credit risks associated with its loan portfolio, management may, depending on current or anticipated economic conditions and related exposures, apply enhanced risk management measures to loans through analysis of a specific borrower's financial condition, including cash flow, collateral values, and guarantees, among other credit factors. In response to the current market dynamics, including economic uncertainties and elevated market interest rates since 2022, the Company has enhanced its stress testing to mitigate interest rate reset risk with a specific emphasis on borrowers’ abilities to absorb the impact of higher interest loan rates.

The following table sets forth the allocation of our nonperforming assets among our different asset categories as of the dates indicated. We classify nonperforming assets as nonaccrual loans and securities, factored receivables greater than 90 days past due, OREO, and other repossessed assets. The balances of nonperforming loans reflect the recorded investment in these assets, including deductions for purchase discounts.


(Dollars in thousands)	June 30, 2026			December 31, 2025
Nonperforming loans:
Commercial real estate	$	42,518		$	8,502
Construction, land development, land	—			—
1-4 family residential	2,276			1,790
Farmland	417			458
Commercial	44,774			45,446
Factored receivables	515			1,347
Consumer	12			12
Mortgage warehouse	—			—
Total nonperforming loans held for investment	90,512			57,555

Held to maturity securities	3,082			1,913

Other real estate owned, net	—			10,185
Other repossessed assets	1,716			220
Total nonperforming assets	$	95,310		$	69,873

Nonperforming assets to total assets	1.29		%	1.10		%
Nonperforming loans to total loans held for investment	1.65		%	1.15		%
Total past due loans to total loans held for investment	2.19		%	2.72		%

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Nonperforming loans increased $33.0 million, or 57.3%, due to the additions of a $37.6 million commercial real estate loan secured by an office building, $7.3 million of equipment finance relationships, and a $2.4 million commercial real estate loan secured by a commercial property to nonaccrual. These increases were partially offset by a $3.2 million partial pay-down/partial charge-off on a nonperforming equipment finance relationship, a $1.7 million pay-off on a commercial real estate loan, a $3.9 million partial pay-down/partial charge-off of a nonperforming commercial real estate loan, and a $0.8 million reduction in nonperforming factored receivables.

OREO decreased $10.2 million due to the sale of a large property during the six months ended June 30, 2026.

As a result of the activity previously described and changes in our period end total loans held for investment, the ratio of nonperforming loans to total loans held for investment increased to 1.65% at June 30, 2026 from 1.15% at December 31, 2025.

Our ratio of nonperforming assets to total assets increased to 1.29% at June 30, 2026 from 1.10% at December 31, 2025. This is due to the aforementioned loan activity and an increase in other repossessed assets as well as changes in our period end total assets.

Past due loans to total loans held for investment decreased to 2.19% at June 30, 2026 from 2.72% at December 31, 2025, reflecting decreases in past due loans across several loan segments.

Allowance for Credit Losses on Loans

The ACL is a valuation allowance estimated at each balance sheet date in accordance with US GAAP that is deducted from the loans’ amortized cost basis to present the net amount expected to be collected on the loans. When the Company deems all or a portion of a loan to be uncollectible the appropriate amount is written off and the ACL is reduced by the same amount. Subsequent recoveries, if any, are credited to the ACL when received. See Note 1 of the Company’s 2025 Form 10-K and notes to the consolidated financial statements included elsewhere in this report for discussion of our ACL methodology on loans. Allocations of the ACL may be made for specific loans, but the entire allowance is available for any loan that, in the Company’s judgment, should be charged-off.

Loan loss valuation allowances are recorded on specific at-risk balances, typically consisting of collateral dependent loans and factored invoices greater than 90 days past due with negative cash reserves.

The following table sets forth the ACL by category of loan:


	June 30, 2026						December 31, 2025
(Dollars in thousands)	Allocated Allowance		% of Loan Portfolio		ACL to Loans		Allocated Allowance		% of Loan Portfolio		ACL to Loans
Commercial real estate	$	4,244	12	%	0.64	%	$	4,713	15	%	0.65	%
Construction, land development, land	2,919		4	%	1.52	%	2,970		4	%	1.32	%
1-4 family residential	2,086		4	%	1.01	%	1,927		4	%	1.00	%
Farmland	301		1	%	0.70	%	298		1	%	0.69	%
Commercial	11,450		21	%	0.99	%	14,947		24	%	1.28	%
Factored receivables	12,308		39	%	0.58	%	10,069		29	%	0.69	%
Consumer	413		—	%	2.47	%	429		—	%	2.55	%
Mortgage warehouse	1,062		19	%	0.10	%	1,158		23	%	0.10	%
Total Loans	$	34,783	100	%	0.64	%	$	36,511	100	%	0.73	%

The ACL decreased $1.7 million, or 4.7%. This decrease reflects net charge-offs of $3.6 million and credit loss expense of $1.9 million.

A driver of the change in ACL is change in the loss drivers that the Company forecasted to calculate expected losses at June 30, 2026 as compared to December 31, 2025. Such change had a positive impact on the Company’s loss drivers and assumptions over the reasonable and supportable forecast period and resulted in decrease of $3.6 million of ACL period over period. The positive impact on the Company's loss drivers was caused by improved forecasted conditions in our equipment finance loan segment (included in Commercial loans in the table above).

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The Company uses the discounted cash flow (DCF) method to estimate ACL for the commercial real estate, construction, land development, land, 1-4 family residential, commercial (excluding liquid credit), and consumer loan pools. For all loan pools utilizing the DCF method, the Company utilizes and forecasts national unemployment as a loss driver. The Company also utilizes and forecasts either one-year percentage change in national retail sales (commercial real estate – non multifamily, commercial general, commercial agriculture, commercial asset-based lending, commercial equipment finance, consumer), one-year percentage change in the national home price index (1-4 family residential and construction, land development, land), or one-year percentage change in national gross domestic product (commercial real estate – multifamily) as a second loss driver depending on the nature of the underlying loan pool and how well that loss driver correlates to expected future losses. Consistent forecasts of the loss drivers are used across the loan segments. The Company also forecasts prepayment speeds for use in the DCF models with higher prepayment speeds resulting in lower required ACL levels and vice versa for shorter prepayment speeds. These assumed prepayment speeds are based upon our historical prepayment speeds by loan type adjusted for the expected impact of the future interest rate environment. The impact of these assumed prepayment speeds is lesser in magnitude than the aforementioned loss driver assumptions.

The following tables show our credit ratios and an analysis of our credit loss expense:


(Dollars in thousands)	June 30, 2026			December 31, 2025
Allowance for credit losses on loans	$	34,783		$	36,511
Total loans held for investment	$	5,477,091		$	4,991,307
Allowance to total loans held for investment	0.64		%	0.73		%

Nonaccrual loans	$	89,997		$	56,208
Total loans held for investment	$	5,477,091		$	4,991,307
Nonaccrual loans to total loans held for investment	1.64		%	1.13		%

Allowance for credit losses on loans	$	34,783		$	36,511
Nonaccrual loans	$	89,997		$	56,208
Allowance for credit losses to nonaccrual loans	38.65		%	64.96		%

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	Three Months Ended June 30,
	2026						2025
(Dollars in thousands)	Net Charge-Offs		Average Loans HFI		Net Charge-Off Ratio		Net Charge-Offs		Average Loans HFI		Net Charge-Off Ratio
Commercial real estate	$	620	$	683,045	0.09	%	$	(59)	$	769,624	(0.01)	%
Construction, land development, land	(1)		206,574		—	%	249		217,235		0.11	%
1-4 family residential	48		191,727		0.03	%	44		163,894		0.03	%
Farmland	—		43,436		—	%	—		44,767		—	%
Commercial	622		1,114,975		0.06	%	10,851		1,101,336		0.99	%
Factored receivables	391		1,903,547		0.02	%	(3,340)		1,340,895		(0.25)	%
Consumer	58		17,075		0.34	%	57		12,800		0.45	%
Mortgage warehouse	—		1,109,544		—	%	—		1,068,476		—	%
Total Loans	$	1,738	$	5,269,923	0.03	%	$	7,802	$	4,719,027	0.17	%

Quarter to date net loans charged off decreased $6.1 million. There were no individually significant charge-offs during the three months ended June 30, 2026. Net charge-offs during the three months ended June 30, 2025 reflect the $10.8 million charge off on the acquired PCD loan that had no impact on earnings. Such charge-offs also reflect the $3.8 million recovery resulting from the USPS settlement.


	Six Months Ended June 30,
	2026						2025
(Dollars in thousands)	Net Charge-Offs		Average Loans HFI		Net Charge-Off Ratio		Net Charge-Offs		Average Loans HFI		Net Charge-Off Ratio
Commercial real estate	$	620	$	704,628	0.09	%	$	54	$	768,822	0.01	%
Construction, land development, land	(1)		210,807		—	%	249		213,347		0.12	%
1-4 family residential	46		191,195		0.02	%	43		160,080		0.03	%
Farmland	—		42,965		—	%	—		48,839		—	%
Commercial	872		1,113,613		0.08	%	15,148		1,104,141		1.37	%
Factored receivables	1,887		1,715,807		0.11	%	(2,082)		1,286,489		(0.16)	%
Consumer	171		16,882		1.01	%	189		10,453		1.81	%
Mortgage warehouse	—		1,098,636		—	%	—		1,002,867		—	%
Total Loans	$	3,595	$	5,094,533	0.07	%	$	13,601	$	4,595,038	0.30	%

Year to date net loans charged off decreased $10.0 million. There were no individually significant charge-offs during the three months ended June 30, 2026. Net charge-offs during the six months ended June 30, 2025 reflect the $10.8 million charge off on the acquired PCD loan that had no impact on earnings. Such charge-offs also reflect the $3.8 million recovery resulting from the USPS settlement and a $3.7 million partial charge-off of a liquid credit relationship.

Securities

As of June 30, 2026 and December 31, 2025, we held equity securities with readily determinable fair values of $4.5 million and $4.6 million, respectively. These securities represent investments in a publicly traded Community Reinvestment Act mutual fund and are subject to market pricing volatility, with changes in fair value reflected in earnings.

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As of June 30, 2026, we held debt securities classified as available for sale with a fair value of $268.1 million, a decrease of $96.2 million from $364.3 million at December 31, 2025. The following table illustrates the changes in our available for sale debt securities:


	Available For Sale Debt Securities:
(Dollars in thousands)	June 30, 2026		December 31, 2025		$ Change		% Change
Mortgage-backed securities, residential	$	80,408	$	88,500	$	(8,092)	(9.1)	%
Asset-backed securities	743		811		(68)		(8.4)	%
State and municipal	2,588		2,589		(1)		—	%
CLO Securities	183,183		271,074		(87,891)		(32.4)	%
Corporate bonds	260		263		(3)		(1.1)	%
SBA pooled securities	936		1,040		(104)		(10.0)	%
	$	268,118	$	364,277	$	(96,159)	(26.4)	%

Our available for sale CLO portfolio consists of investment grade positions in high ranking tranches within their respective securitization structures. As of June 30, 2026, the Company determined that all impaired available for sale securities experienced a decline in fair value below their amortized cost basis due to noncredit-related factors. Therefore, the Company carried no ACL at June 30, 2026. Our available for sale securities can be used for pledging to secure FHLB borrowings and public deposits, or can be sold to meet liquidity needs.

As of June 30, 2026, we held investments classified as held to maturity with an amortized cost, net of ACL, of $1.0 million, a decrease of $0.6 million from $1.6 million at December 31, 2025. See previous discussion of Credit Loss Expense related to our held to maturity securities for further details regarding the nature of these securities and the required ACL at June 30, 2026.

The following tables set forth the amortized cost and average yield of our debt securities, by type and contractual maturity:


	Maturity as of June 30, 2026
	One Year or Less				After One but within Five Years				After Five but within Ten Years				After Ten Years				Total
(Dollars in thousands)	Amortized Cost		Average Yield		Amortized Cost		Average Yield		Amortized Cost		Average Yield		Amortized Cost		Average Yield		Amortized Cost		Average Yield
Mortgage-backed securities	$	24	2.28	%	$	584	2.36	%	$	503	4.78	%	$	83,172	4.59	%	$	84,283	4.58	%
Asset-backed securities	—		—	%	—		—	%	750		3.80	%	—		—	%	750		3.80	%
State and municipal	—		—	%	2,132		2.88	%	504		2.66	%	—		—	%	2,636		2.84	%
CLO securities	—		—	%	—		—	%	29,686		5.49	%	153,002		5.17	%	182,688		5.22	%
Corporate bonds	—		—	%	—		—	%	264		5.14	%	—		—	%	264		5.14	%
SBA pooled securities	—		—	%	—		—	%	701		2.61	%	275		6.00	%	976		3.56	%
Total available for sale securities	$	24	2.28	%	$	2,716	2.77	%	$	32,408	5.33	%	$	236,449	4.96	%	$	271,597	4.99	%

Held to maturity securities:	$	—	—	%	$	3,082	4.13	%	$	—	—	%	$	—	—	%	$	3,082	4.13	%

Liabilities

Total liabilities were $6.440 billion as of June 30, 2026, compared to $5.439 billion at December 31, 2025, an increase of $1.002 billion, the components of which are discussed below.

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Deposits

The following table summarizes our deposits:


(Dollars in thousands)	June 30, 2026		December 31, 2025		$ Change		% Change
Noninterest bearing demand	$	3,780,765	$	1,901,638	$	1,879,127	98.8	%
Interest bearing demand	661,332		845,060		(183,728)		(21.7	%)
Individual retirement accounts	35,170		37,634		(2,464)		(6.5	%)
Money market	719,455		608,036		111,419		18.3	%
Savings	552,238		522,189		30,049		5.8	%
Certificates of deposit	212,943		224,644		(11,701)		(5.2	%)
Brokered time deposits	213,315		695,093		(481,778)		(69.3	%)
Other brokered deposits	42,171		115,922		(73,751)		(63.6	%)
Total Deposits	$	6,217,389	$	4,950,216	$	1,267,173	25.6	%

Our total deposits increased $1.267 billion, or 25.6%, primarily due to an increase in noninterest bearing demand deposits, money market deposits, and savings deposits. Our mortgage warehouse business is more than self-funded due to the servicing deposits of its customers. The balances of such noninterest bearing deposits were $2.273 billion and $668.3 million at June 30, 2026 and December 31, 2025, respectively. The Company experienced decreases in many other material deposit categories. Other brokered deposits are non-maturity deposits obtained from wholesale sources. As of June 30, 2026, interest bearing demand deposits, noninterest bearing deposits, money market deposits, other brokered deposits, and savings deposits accounted for 93% of our total deposits, while individual retirement accounts, certificates of deposit, and brokered time deposits made up 7% of total deposits. At June 30, 2026 and December 31, 2025, our estimated uninsured deposits were $1.643 billion and $1.466 billion, respectively.

At June 30, 2026 we held $61.1 million of time deposits that meet or exceed the Federal Deposit Insurance Corporation ("FDIC") insurance limit. The following table provides information on the maturity distribution of time deposits exceeding the FDIC insurance limit as of June 30, 2026:


(Dollars in thousands)	Over $250,000
Maturity
3 months or less	$	25,100
Over 3 through 6 months	21,409
Over 6 through 12 months	9,120
Over 12 months	3,014
	$	58,643

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The following table summarizes our average deposit balances and weighted average rates:


	Three Months Ended June 30, 2026						Three Months Ended June 30, 2025

(Dollars in thousands)	Average Balance		Weighted Avg Rates		% of Total		Average Balance		Weighted Avg Rates		% of Total
Interest bearing demand	$	678,219	7.80	%	11	%	$	722,653	0.51	%	15	%
Individual retirement accounts	35,623		1.27	%	1	%	41,694		1.26	%	1	%
Money market	662,643		2.56	%	11	%	586,420		2.69	%	12	%
Savings	550,784		1.18	%	9	%	519,067		1.05	%	10	%
Certificates of deposit	218,365		2.45	%	4	%	225,333		2.71	%	5	%
Brokered time deposits	306,476		3.95	%	5	%	614,168		4.32	%	12	%
Other brokered deposits	56,864		3.70	%	1	%	93,315		4.45	%	2	%
Total interest bearing deposits	2,508,974		3.84	%	42	%	2,802,650		2.22	%	57	%
Noninterest bearing demand	3,583,133		—		58	%	2,166,628		—		43	%
Total deposits	$	6,092,107	1.58	%	100	%	$	4,969,278	1.25	%	100	%

	Six Months Ended June 30, 2026						Six Months Ended June 30, 2025
(Dollars in thousands)	Average Balance		Weighted Avg Yields		% of Total		Average Balance		Weighted Avg Yields		% of Total
Interest bearing demand	$	680,332	4.13	%	12	%	$	727,873	0.49	%	15	%
Individual retirement accounts	36,104		1.23	%	1	%	42,399		1.26	%	1	%
Money market	635,679		2.54	%	11	%	598,763		2.63	%	12	%
Savings	543,088		1.17	%	10	%	518,879		1.06	%	11	%
Certificates of deposit	221,400		2.51	%	4	%	228,480		2.68	%	5	%
Brokered time deposits	433,679		3.96	%	8	%	591,808		4.44	%	12	%
Other brokered deposits	81,080		3.69	%	1	%	56,810		4.46	%	1	%
Total interest bearing deposits	2,631,362		2.92	%	47	%	2,765,012		2.18	%	57	%
Noninterest bearing demand	3,073,892		—		53	%	2,086,412		—		43	%
Total deposits	$	5,705,254	1.35	%	100	%	$	4,851,424	1.24	%	100	%

The Company's deposit base is made up of a high number of customers with accounts spread across 62 locations in six states. Our deposit base is diverse in terms of both geography and industry, comprised largely of retail as well small-to-medium sized business customers. The majority of our deposits are FDIC insured.

Other Borrowings

FHLB Advances

The following provides a summary of our FHLB advances as of and for the six months ended June 30, 2026 and the year ended December 31, 2025:


(Dollars in thousands)	June 30, 2026			December 31, 2025
Amount outstanding at end of period	$	—		$	280,000
Weighted average interest rate at end of period	—		%	3.67		%
Average amount outstanding during the period	56,105			208,014
Weighted average interest rate during the period	3.77		%	4.35		%
Highest month end balance during the period	205,000			355,000

Our FHLB advances are collateralized by assets, including a blanket pledge of certain loans. At June 30, 2026 and December 31, 2025, we had $940.8 million and $644.7 million, respectively, in unused and available advances from the FHLB.

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Subordinated Notes

On August 26, 2021, the Company issued $70.0 million of Fixed-to-Floating Rate Subordinated Notes due 2031 (the “2021 Notes”). The 2021 Notes initially bear interest at 3.500% per annum, payable semi-annually in arrears, to, but excluding, September 1, 2026, and, thereafter and to, but excluding, the maturity date or earlier redemption, interest shall be payable quarterly in arrears, at an annual floating rate equal to a benchmark rate, initially three-month SOFR, as determined for the applicable quarterly period, plus 2.860%. The Company may, at its option, beginning on September 1, 2026 and on any scheduled interest payment date thereafter, redeem the 2021 Notes, in whole or in part, at a redemption price equal to the outstanding principal amount of the 2021 Notes to be redeemed plus accrued and unpaid interest to, but excluding, the date of redemption.

The Subordinated Notes are included on the consolidated balance sheets as liabilities at their carrying values; however, for regulatory purposes, the $70.0 million and $69.9 million carrying value of these obligations at June 30, 2026 and December 31, 2025, respectively, were eligible for inclusion in Tier 2 regulatory capital. At the beginning of each of the last five years of the life of the Subordinated Notes, the amount eligible to be included in Tier 2 regulatory capital will be reduced by 20%.

Issuance costs related to the Subordinated Notes have been netted against the subordinated notes liability on the balance sheet. The debt issuance costs are being amortized using the effective interest method through maturity and recognized as a component of interest expense.

The Subordinated Notes are subordinated in right of payment to the Company’s existing and future senior indebtedness and are structurally subordinated to the Company’s subsidiaries’ existing and future indebtedness and other obligations.

Junior Subordinated Debentures

The following provides a summary of our junior subordinated debentures as of June 30, 2026:


(Dollars in thousands)	Face Value		Carrying Value		Maturity Date	Interest Rate
National Bancshares Capital Trust II	$	15,464	$	14,026	September 2033	Three Month SOFR + 3.26%
National Bancshares Capital Trust III	17,526		14,260		July 2036	Three Month SOFR + 1.64%
ColoEast Capital Trust I	5,155		4,055		September 2035	Three Month SOFR + 1.86%
ColoEast Capital Trust II	6,700		5,203		March 2037	Three Month SOFR + 2.05%
Valley Bancorp Statutory Trust I	3,093		2,962		September 2032	Three Month SOFR + 3.66%
Valley Bancorp Statutory Trust II	3,093		2,815		July 2034	Three Month SOFR + 3.01%
	$	51,031	$	43,321

These debentures are unsecured obligations and were issued to trusts that are unconsolidated subsidiaries. The trusts in turn issued trust preferred securities with identical payment terms to unrelated investors. The debentures may be called by the Company at par plus any accrued but unpaid interest; however, we have no current plans to redeem them prior to maturity. Interest on the debentures is calculated quarterly, based on a contractual rate equal to three month SOFR plus a weighted average spread of 2.41%. As part of the purchase accounting adjustments made with the National Bancshares, Inc. acquisition on October 15, 2013, the ColoEast acquisition on August 1, 2016, and the Valley acquisition on December 9, 2017, we adjusted the carrying value of the junior subordinated debentures to fair value as of the respective acquisition dates. The discounts on the debentures will continue to be amortized through maturity and recognized as a component of interest expense.

The debentures are included on our consolidated balance sheet as liabilities; however, for regulatory purposes, these obligations are eligible for inclusion in regulatory capital, subject to certain limitations. All of the carrying value of $43.3 million was allowed in the calculation of Tier I capital as of June 30, 2026.

Capital Resources and Liquidity Management

Capital Resources

Our stockholders’ equity totaled $963.3 million as of June 30, 2026, compared to $941.8 million as of December 31, 2025, an increase of $21.5 million. Stockholders’ equity increased during this period primarily due to our net income, stock based compensation expense, and the issuance of common stock pursuant to our employee stock purchase plan.

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Liquidity Management

We define liquidity as our ability to generate sufficient cash to fund current loan demand, deposit withdrawals, other cash demands and disbursement needs, and otherwise to operate on an ongoing basis.

We manage liquidity at the holding company level as well as that of our bank subsidiary. The management of liquidity at both levels is critical, because the holding company and our bank subsidiary have different funding needs and sources, and each is subject to regulatory guidelines and requirements which require minimum levels of liquidity. We believe that our liquidity ratios meet or exceed those guidelines and that our present position is adequate to meet our current and future liquidity needs.

As part of our liquidity management process, we regularly stress test our balance sheet to ensure that we are continually able to withstand unexpected liquidity shocks such as sudden or protracted material deposit runoff. This analysis explicitly contemplates the immediate runoff of any meaningful deposit concentrations such as the servicing deposits that we hold on behalf of our mortgage warehouse customers.

Our liquidity requirements are met primarily through cash flow from operations, receipt of pre-paid and maturing balances in our loan and investment portfolios, debt financing and increases in customer deposits. Our liquidity position is supported by management of liquid assets and liabilities and access to other sources of funds. Liquid assets include cash, interest earning deposits in banks, federal funds sold, securities available for sale and maturing or prepaying balances in our investment and loan portfolios. Liquid liabilities include core deposits, federal funds purchased, securities sold under repurchase agreements and other borrowings. Other sources of funds include the sale of loans, brokered deposits, the issuance of additional collateralized borrowings such as FHLB advances or borrowings from the Federal Reserve, the issuance of debt securities and the issuance of common securities. For additional information regarding our operating, investing and financing cash flows, see the Consolidated Statements of Cash Flows provided in our consolidated financial statements.

In addition to the liquidity provided by the sources described above, our subsidiary bank maintains correspondent relationships with other banks in order to sell loans or purchase overnight funds should additional liquidity be needed. As of June 30, 2026, TBK Bank had $727.8 million of unused borrowing capacity from the Federal Reserve Bank discount window and unsecured federal funds lines of credit with seven unaffiliated banks totaling $227.5 million, with no amounts advanced against those lines. Additionally, as of June 30, 2026, we had $940.8 million in unused and available advances from the FHLB. We have historically utilized FHLB advances to support the fluctuating and sometimes unpredictable balances in our mortgage warehouse lending portfolio, and we continue to have the ability to do so.

Contractual Obligations

The following table summarizes our contractual obligations and other commitments to make future payments as of June 30, 2026. The amount of the obligations presented in the table reflect principal amounts only and exclude the amount of interest we are obligated to pay. Also excluded from the table are a number of obligations to be settled in cash. These excluded items are reflected in our consolidated balance sheet and include deposits with no stated maturity, trade payables, and accrued interest payable.


	Payments Due by Period - June 30, 2026
(Dollars in thousands)	Total		One Year or Less		After One but within Three Years		After Three but within Five Years		After Five Years


Subordinated notes	$	70,000	$	—	$	—	$	—	$	70,000
Junior subordinated debentures	51,031		—		—		—		51,031
Operating lease agreements	43,587		6,098		10,995		9,505		16,989
Time deposits with stated maturity dates	461,428		441,972		15,912		3,544		—
Total contractual obligations	$	626,046	$	448,070	$	26,907	$	13,049	$	138,020

Regulatory Capital Requirements

Our capital management consists of providing equity to support our current and future operations. We are subject to various regulatory capital requirements administered by federal and state banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s or TBK Bank’s financial statements. For further information regarding our regulatory capital requirements, see Note 10 – Regulatory Matters in the accompanying condensed notes to the consolidated financial statements included elsewhere in this report.

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Off-Balance Sheet Arrangements

In the normal course of business, we enter into various transactions, which, in accordance with GAAP, are not included in our consolidated balance sheets. We enter into these transactions to meet the financing needs of our customers. These transactions include commitments to extend credit and standby and commercial letters of credit, which involve, to varying degrees, elements of credit risk and interest rate risk in excess of the amounts recognized in the consolidated balance sheets. For further information, see Note 8 – Off-Balance Sheet Loan Commitments in the accompanying condensed notes to the consolidated financial statements included elsewhere in this report.

Critical Accounting Policies and Estimates

Our accounting policies are fundamental to understanding our management’s discussion and analysis of our results of operations and financial condition. We have identified certain significant accounting policies which involve a higher degree of judgment and complexity in making certain estimates and assumptions that affect amounts reported in our consolidated financial statements. The significant accounting policy which we believe to be the most critical in preparing our consolidated financial statements is the determination of the allowance for credit losses. Since December 31, 2025, there have been no changes in critical accounting policies as further described under “Critical Accounting Policies and Estimates” and in Note 1 to the Consolidated Financial Statements in our 2025 Form 10-K.

Recently Issued Accounting Pronouncements

See Note 1 – Summary of Significant Accounting Policies in the accompanying condensed notes to consolidated financial statements included elsewhere in this report for details of recently issued accounting pronouncements and their expected impact on our consolidated financial statements.

Forward-Looking Statements

This document contains forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “would” and “outlook,” or the negative version of those words or other comparable of a future or forward-looking nature. These forward-looking statements are not historical facts and are 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, particularly with regard to developments related to COVID-19. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are 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.

There are or will be important factors that could cause our actual results to differ materially from those indicated in these forward-looking statements, including, but are not limited to, the following:

•business and economic conditions generally and in the bank and non-bank financial services industries, nationally and within our local market areas;

•our ability to mitigate our risk exposures;

•our ability to maintain our historical earnings trends;

•changes in management personnel;

•interest rate risk;

•concentration of our products and services in the transportation industry;

•credit risk associated with our loan portfolio;

•lack of seasoning in our loan portfolio;

•deteriorating asset quality and higher loan charge-offs;

•time and effort necessary to resolve nonperforming assets;

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•inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates;

•risks related to the integration of acquired businesses, including our acquisition of Greenscreens, and any future acquisitions;

•our ability to successfully identify and address the risks associated with our possible future acquisitions, and the risks that our prior and possible future acquisitions make it more difficult for investors to evaluate our business, financial condition and results of operations, and impairs our ability to accurately forecast our future performance;

•lack of liquidity;

•fluctuations in the fair value and liquidity of the securities we hold for sale;

•impairment of investment securities, goodwill, other intangible assets or deferred tax assets;

•our risk management strategies;

•environmental liability associated with our lending activities;

•increased competition in the bank and non-bank financial services industries, nationally, regionally or locally, which may adversely affect pricing and terms;

•the accuracy of our financial statements and related disclosures;

•material weaknesses in our internal control over financial reporting;

•system failures or failures to prevent breaches of our network security;

•the institution and outcome of litigation and other legal proceedings against us or to which we become subject;

•changes in carry-forwards of net operating losses;

•changes in federal tax law or policy;

•the impact of recent and future legislative and regulatory changes, including changes in banking, securities and tax laws and regulations, such as the Dodd-Frank Act and their application by our regulators as well as privacy, cybersecurity, and artificial intelligence regulation and oversight;

•governmental monetary and fiscal policies;

•changes in the scope and cost of FDIC, insurance and other coverages;

•failure to receive regulatory approval for future acquisitions; and

•increases in our capital requirements.

The foregoing factors should not be construed as exhaustive. If one or more events related to these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made and we do not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New factors emerge from time to time and it is not possible for us to predict which will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

ITEM 3

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

Asset/Liability Management and Interest Rate Risk

The principal objective of our asset and liability management function is to evaluate the interest rate risk within the balance sheet and pursue a controlled assumption of interest rate risk while maximizing net income and preserving adequate levels of liquidity and capital. The board of directors of our subsidiary bank has oversight of our asset and liability management function, which is managed by our Chief Financial Officer. Our Chief Financial Officer meets with our senior executive management team regularly to review, among other things, the sensitivity of our assets and liabilities to market interest rate changes, local and national market conditions and market interest rates. That group also reviews our liquidity, capital, deposit mix, loan mix and investment positions.

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As a financial institution, our primary component of market risk is interest rate volatility. Fluctuations in interest rates will ultimately impact both the level of income and expense recorded on most of our assets and liabilities, and the fair value of all interest-earning assets and interest-bearing liabilities, other than those which have a short term to maturity. Interest rate risk is the potential of economic losses due to future interest rate changes. These economic losses can be reflected as a loss of future net interest income and/or a loss of current fair values.

We manage our exposure to interest rates primarily by structuring our balance sheet in the ordinary course of business. We do not typically enter into derivative contracts for the purpose of managing interest rate risk, but we may elect to do so in the future. Based upon the nature of our operations, we are not subject to foreign exchange or commodity price risk. We do not own any trading assets.

We use an interest rate risk simulation model to test the interest rate sensitivity of net interest income and the balance sheet. Instantaneous parallel rate shift scenarios are modeled and utilized to evaluate risk and establish exposure limits for acceptable changes in projected net interest margin. These scenarios, known as rate shocks, simulate an instantaneous change in interest rates and use various assumptions, including, but not limited to, prepayments on loans and securities, deposit decay rates, pricing decisions on loans and deposits, and reinvestment and replacement of asset and liability cash flows. We also analyze the economic value of equity as a secondary measure of interest rate risk. This is a complementary measure to net interest income where the calculated value is the result of the fair value of assets less the fair value of liabilities. The economic value of equity is a longer term view of interest rate risk because it measures the present value of all future cash flows. The impact of changes in interest rates on this calculation is analyzed for the risk to our future earnings and is used in conjunction with the analyses on net interest income.

The following table summarizes simulated change in net interest income versus unchanged rates as of June 30, 2026 and December 31, 2025:


	June 30, 2026				December 31, 2025
	Following 12 Months		Months 13-24		Following 12 Months		Months 13-24
+400 basis points	4.5	%	7.0	%	9.3	%	11.1	%
+300 basis points	3.3	%	5.1	%	7.1	%	8.4	%
+200 basis points	2.0	%	3.3	%	4.8	%	5.7	%
+100 basis points	0.8	%	1.5	%	2.4	%	2.9	%
Flat rates	0.0	%	0.0	%	0.0	%	0.0	%
-100 basis points	(1.7	%)	(2.5	%)	(2.3	%)	(3.0	%)
-200 basis points	(2.9	%)	(4.7	%)	(4.9	%)	(6.7	%)
-300 basis points	(4.1	%)	(6.8	%)	(7.4	%)	(10.2	%)

The following table presents the change in our economic value of equity as of June 30, 2026 and December 31, 2025, assuming immediate parallel shifts in interest rates:


	Economic Value of Equity at Risk (%)
	June 30, 2026		December 31, 2025
+400 basis points	10.0	%	8.4	%
+300 basis points	7.9	%	6.6	%
+200 basis points	5.5	%	4.6	%
+100 basis points	2.7	%	2.1	%
Flat rates	0.0	%	0.0	%
-100 basis points	(3.0	%)	(2.5	%)
-200 basis points	(6.5	%)	(5.3	%)
-300 basis points	(10.3	%)	(8.5	%)

Many assumptions are used to calculate the impact of interest rate fluctuations. Actual results may be significantly different than our projections due to several factors, including the timing and frequency of rate changes, market conditions and the shape of the yield curve. The computations of interest rate risk shown above do not include actions that our management may undertake to manage the risks in response to anticipated changes in interest rates, and actual results may also differ due to any actions taken in response to the changing rates.

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As part of our asset/liability management strategy, our management has emphasized the origination of shorter duration loans as well as variable rate loans to limit the negative exposure to a rate increase. We also desire to acquire deposit transaction accounts, particularly noninterest or low interest-bearing non-maturity deposit accounts, whose cost is less sensitive to changes in interest rates. We intend to focus our strategy on utilizing our deposit base and operating platform to increase these deposit transaction accounts.

ITEM 4

CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of the end of the period covered by this Quarterly Report on Form 10-Q, the Company carried out an evaluation, under the supervision and with the participation of its management, including its Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of its disclosure controls and procedures. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management was required to apply judgment in evaluating its controls and procedures. Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective as of the end of the period covered by this report.

Changes in Internal Control Over Financial Reporting

There were no changes in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarter ended June 30, 2026, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

From time to time we are a party to various litigation matters incidental to the conduct of our business. Except as set forth below, we are not presently party to any legal proceedings the resolution of which we believe would have a material adverse effect on our business, prospects, financial condition, liquidity, results of operation, cash flows or capital levels.

Item 1A. Risk Factors

There have been no material changes in the Company’s risk factors from those disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

Not applicable.

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Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Insider Trading Arrangements

On February 19, 2026, Mr. Edward J. Schreyer, the Company’s Executive Vice President and Chief Operating Officer, adopted a written plan for the sale of our common stock that is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act (the “Schreyer Trading Plan”). The Schreyer Trading Plan covers the sale of up to 90 percent of the net shares (after applicable tax withholding) of the Company’s common stock received by Mr. Schreyer upon the May 1, 2026 vesting of equity awards previously issued to Mr. Schreyer, to occur in several transactions over a period commencing after the later of (1) 90 days from the execution of the Schreyer Trading Plan and (2) the second trading day following the public disclosure of the Company’s financial results on Form 10-Q for the quarter ended March 31, 2026, and will cease upon the earlier of January 31, 2027 or the sale of all shares subject to the Schreyer Trading Plan.

As of the end of the second quarter of 2026, none of our other directors or executive officers adopted Rule 10b5-1 trading plans and none of our directors or executive officers terminated a Rule 10b5-1 trading plan or adopted or terminated a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K).

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Item 6. Exhibits

Exhibits (Exhibits marked with a “†” denote management contracts or compensatory plans or arrangements)


3.1						Second Amended and Restated Certificate of Formation of the Registrant, effective November 7, 2014, incorporated by reference to Exhibit 3.1 to Form 8-K filed with the SEC on November 13, 2014.

3.2						Certificate of Amendment to Second Amended and Restated Certificate of Formation of Triumph Bancorp, Inc., incorporated by reference to Exhibit 3.1 to Form 8-K filed with the SEC on May 10, 2018.

3.3						Certificate of Amendment to Second Amended and Restated Certificate of Formation of Triumph Bancorp, Inc., incorporated by reference to Exhibit 3.1 to Form 8-K filed with the SEC on December 1, 2022.

3.4						Second Amended and Restated Bylaws of the Registrant, effective November 7, 2014, incorporated by reference to Exhibit 3.2 to Form 8-K filed with the SEC on November 13, 2014.

3.5						Amendment No. 1 to Second Amended and Restated Bylaws of Triumph Bancorp, Inc., incorporated by reference to Exhibit 3.2 to Form 8-K filed with the SEC on May 10, 2018.

3.6						Amendment No. 2 to Second Amended and Restated Bylaws of Triumph Bancorp, Inc., incorporated by reference to Exhibit 3.2 to Form 8-K filed with the SEC on December 1, 2022.

10.1†						Form of Restricted Stock Unit Award Agreement under Triumph Financial, Inc. 2014 Omnibus Incentive Plan.

10.2†						Form of Director Restricted Stock Unit Award Agreement under Triumph Financial, Inc. 2014 Omnibus Incentive Plan.

10.3†						Form of Performance Restricted Stock Unit Award Agreement under Triumph Financial, Inc. 2014 Omnibus Incentive Plan.

10.4†						Form of Nonqualified Option Agreement under Triumph Financial, Inc. 2014 Omnibus Incentive Plan.

31.1						Certification of Chief Executive Officer pursuant to Rule 13a-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2						Certification of Chief Financial Officer pursuant to Rule 13a-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1						Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS						Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).

101.SCH						Inline XBRL Taxonomy Extension Schema Document.

101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB						Inline XBRL Taxonomy Extension Label Linkbase Document.

101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document.

104						Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

* Schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule or exhibit will be furnished to the Securities and Exchange Commission upon request; provided, however, that the parties may request confidential treatment pursuant to Rule 24b-2 of the Exchange Act for any document so furnished.

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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.


		TRIUMPH FINANCIAL INC.
		(Registrant)

Date:	July 21, 2026	/s/ Aaron P. Graft
		Aaron P. Graft President and Chief Executive Officer

Date:	July 21, 2026	/s/ W. Bradley Voss
		W. Bradley Voss Chief Financial Officer

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Form: 10-Q

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