Primis Financial Corp. Reports Strong Results for the Second Quarter of 2026

View all news 07/23/2026 Declares Quarterly Cash Dividend of $0.10 Per Share , /PRNewswire/ -- Primis Financial Corp. (NASDAQ: FRST) ("Primis" or the "Company"), and its wholly-owned subsidiary, Primis Bank (the "Bank"), today reported net income available to common shareholders of $9.4 million, or $0.38 per diluted share, for the three months ended June 30, 2026, compared to net income available to common shareholders of $2.4 million, or $0.10 per diluted share, for the three months ended June 30, 2025. For the six months ended June 30, 2026, the Company reported net income available to common shareholders of $16.7 million, or $0.68 per diluted share, compared to a net income available to common shareholders of $25.1 million, or $1.01 per diluted share, for the six months ended June 30, 2025. Q2 And Year-to-Date 2026 Accomplishments The Company demonstrated strong profitability in the second quarter and first half of 2026. Significant areas of improvement year-over-year are detailed in the chart below: As of or for the Three Months Ended June 30 As of or for the Six Months Ended June 30 ($ in millions except per share) 2026 2025 2026 2025 Net Income $9.4 $2.4 $16.7 $25.1 Pre-Tax Pre-Provision Op. Net Income(1) 11.7 4.1 23.4 10.4 ROAA 0.90 % 0.26 % 0.83 % 1.36 % Pre-Tax Pre-Provision Op. ROAA(1) 1.12 0.44 1.15 0.57 Net Interest Income $33.8 $25.2 $65.8 $51.5 Net Interest Margin 3.45 % 2.86 % 3.44 % 3.00 % Total Assets $4,353 $3,872 $4,353 $3,872 Gross Loans HFI 3,466 3,131 3,466 3,131 Total Deposits 3,446 3,343 3,446 3,343 Average Earning Assets $ 3,929 $3,532 $ 3,862 $3,466 Avg. NIB Deposits 566 467 550 457 Avg. NIB /Avg. Total Deposits 16.3 % 14.3 % 16.1 % 14.3 % TCE /TA(1) 7.99 % 7.49 % 7.99 % 7.49 % Tangible Book Value per Share(1) $13.72 $11.48 $13.72 $11.48 Commenting on the results, Dennis J. Zember, Jr., President and Chief Executive Officer of the Company, stated, "We delivered another quarter of improving results and continued momentum. Our ROA climbed to 0.90% in the second quarter, more than three times where it was a year ago. Just as noteworthy, NPAs declined by 37% during the quarter and our allowance to NPAs increased to 73%. During the quarter, we recognized a pre-tax gain related to the sale of Bearing Insurance totaling $5.9 million. We offset that gain with a provision for loan losses on a larger office CRE loan and a $0.9 settlement on a nuisance lawsuit regarding mortgage recruiting. Lastly, as discussed later in this press release, we have identified substantial earnings enhancements related to our announcement to convert the entire bank to our digital, real-time core. The total earnings impact of $6.1 million is equally centered on revenue and expense improvements and should be incrementally in place beginning in the fourth quarter of 2026. This project will afford us another year of the superior operating leverage that we have been demonstrating while putting the entire bank on the most sales focused real time core available in our industry." Division Updates The second quarter of 2026 demonstrated continued progress across the Company's strategies to meet its growth and profitability goals in 2026. The following discussion highlights recent progress for each of these strategies: Core Community Bank The Core Bank's 24 banking offices in Virginia and Maryland represent almost two-thirds of the Company's total balance sheet. Management believes the Core Bank drives significant value for the Company with a stable deposit base and strong core profitability: The Core Bank has low concentrations of investor CRE (23% of total loans and only 188% of regulatory capital).Loan pipeline of $158 million as of June 30, 2026, up 28% from $123 million at March 31, 2026.Cost of deposits of 1.60% in the second quarter of 2026 compared to 1.79% in the same quarter in 2025. Zero brokered deposits.A proprietary banking app for commercial depositors that drives new sales independent of lending efforts in and around the Company's footprint. Approximately 21% of the core Bank's deposit base are noninterest bearing deposits, supported with what management believes is the region's best and most unique technology including the Bank's proprietary V1BE service. Over $450 million of deposits have used the service, including over 80% of commercial clients. Over $70 million of new deposit relationships have resulted directly from the V1BE offering. Primis Mortgage Primis Mortgage had closed mortgage volume of $421 million in the second quarter of 2026, up 30% compared to the same quarter in 2025, in spite of significant macroeconomic headwinds in the second quarter. Construction-to-permanent loan volume was $34 million in the second quarter of 2026 versus $26 million in the same period in 2025. Pre-tax earnings related to Primis Mortgage were approximately $2.2 million for the second quarter of 2026, up substantially from earnings of $0.1 million in the second quarter of 2025. Mortgage Warehouse Mortgage warehouse lending continued to show strong growth in the second quarter of 2026. Outstanding loan balances at June 30, 2026 were $544 million, up 18% from $460 million at March 31, 2026 and up 195% from $185 million at June 30, 2025. Average loan balances were $426 million in the second quarter of 2026, up 24% from $343 million in the first quarter of 2026 and up 226% from $131 million in the second quarter of 2025. Mortgage warehouse also funded on average approximately 11% of its balance sheet with associated customer noninterest bearing deposit balances during the second quarter of 2026. Panacea Financial Panacea's growth remained strong through the second quarter of 2026 with loans outstanding of $617 million, including loans held for sale, up 11% annualized compared to March 31, 2026. Panacea sold approximately $51 million of loans in the second quarter of 2026, including $41 million of loans classified as held for sale at March 31, 2026, and had $33 million of loans classified as held for sale at June 30, 2026. Panacea loans held for investment were $583 million at June 30, 2026, up 18% annualized from $559 million at March 31, 2026. At the end of the second quarter of 2026, Panacea customer deposits totaled $169 million, up 52% from June 30, 2025. Panacea remains the number one ranked "Bank for doctors" on Google and banks over 7,500 professionals and practices nationwide. Digital Platform Funding for the national strategies is provided exclusively by the Bank's digital platform powered by what the Bank believes is one of the safest and most functional deposit accounts in the nation. Because of the scalability of the platform, there is significantly less pressure on the core Bank to provide this funding and risk the profitable, decades old relationships with core customers. The platform ended the second quarter of 2026 with approximately $1.0 billion of deposits with a cost of deposits of 3.79% compared to $1.1 billion at June 30, 2025 with a cost of 4.27%. The platform also successfully grew business accounts in 2026 with small business balances reaching $38 million at June 30, 2026, up substantially from $16 million at December 31, 2025. These customers remain sticky with approximately 74% of our digital deposits banking with Primis for at least three years. Core Consolidation Initiative In 2025, the Company announced its decision to fully convert its core bank and all divisions onto its real-time, fully digital core that had served as the backbone of its successful national deposit origination platform. Concurrent with that decision, management has been fully evaluating its products and services as well as vendors and various contracts supporting both cores. Additional earnings improvements from this evaluation are expected to begin late in 2026 and be fully implemented in early 2027. The improvements to earnings are on both the income and expense side totaling $6.1 million and are comprised of the following: $3 million in revenue improvements resulting from consolidating account types and applying best practice fee solutions across all products and services, expected to be in place by late 2026.$2.4 million in cost savings from consolidation of printing and statement services. Expected to be in place by January 2027.$0.7 million from the consolidation of contracts and other consulting services. Consolidation of these services is beginning in 4Q 2026 with the majority of the savings realized in the first quarter of 2027 and full realization expected by the end of the second quarter of 2027. In addition, we currently amortize approximately $0.8 million per quarter of capitalized costs from the initial development of the digital platform. This amortization expense is expected to end during the third quarter of 2027. Net Interest Income Net interest income in the second quarter of 2026 was $33.8 million, up 34.1%, versus $25.2 million in the second quarter of 2025. As noted above, the Company's net interest margin improved to 3.45% in the second quarter of 2026 compared to 2.86% in the same quarter of 2025 with the expansion driven by robust earning asset growth funded at attractive incremental margins. Yield on earnings assets in the second quarter of 2026 increased three basis points and 34 basis points versus the first quarter of 2026 and second quarter of 2025, respectively. Yield on investments increased 131 basis points year-over-year largely due to the portfolio restructuring in the fourth quarter of 2025. Cost of deposits in the Bank have benefitted from the focus on growing noninterest bearing deposit balances as well as the Core Bank's management of interest expense. In the second quarter of 2026, the Company reported cost of interest-bearing deposits of 2.69% compared to 2.94% in the same quarter in 2025. Cost of funds was 2.46% in the second quarter of 2026, down 21 basis points from 2.67% in the second quarter of 2025. Noninterest Income Noninterest income was $22.0 million in the second quarter of 2026 versus $13.6 million in the first quarter of 2026 and $18.0 million in the second quarter of 2025. The second quarter of 2026 included a gain of $5.9 million from the liquidation of an insurance agency investment while the second quarter of 2025 included a $7.5 million gain on the Company's investment in Panacea Financial Holdings. Mortgage related income grew 44.3% to $11.4 million in the second quarter of 2026 compared to $7.9 million in the same quarter in 2025. In 2026, the Company restructured its bank-owned life insurance portfolio which improved noninterest income by approximately $1.2 million annually beginning late in the second quarter of 2026. The Company reported gain on sale income of $1.6 million related to the sale of Panacea loans and the guaranteed portion of SBA loans in the second quarter of 2026 compared to no similar gain on sale income in the second quarter of 2025. Approximately $237 thousand of the gain on sale income was attributable to the Core Bank in the second quarter of 2026 with the remainder driven by the Panacea Division. The Company anticipates increasing SBA gain on sale income to between $500 thousand to $600 thousand from the Core Bank beginning in the third quarter of 2026. Noninterest Expense Noninterest expense was $38.2 million for the second quarter of 2026, compared to $31.9 million for the same quarter of 2025. The following table reflects the core operating expense burden at the Company, net of mortgage related and Panacea division impacts. ($ in thousands) 2Q26 1Q26 4Q25 3Q25 2Q25 Reported Noninterest Expense $38,207 $33,754 $42,164 $32,313 $31,942 Nonrecurring - - (1,126) - (232) Primis Mortgage Expenses (11,526) (10,545) (10,048) (8,214) (8,514) Panacea Net Expense (1,507) (1,040) (2,614) (2,100) (370) Consumer Program Servicing Fee (300) (347) (391) (439) (518) Reserve for Unfunded Commitment 39 136 127 19 (18) Total Adjustments (13,294) (11,796) (14,052) (10,734) (9,652) Core Operating Expense Burden $24,913 $21,958 $28,112 $21,579 $22,290 Core operating expense burden, as defined above, was $25 million in the second quarter of 2026 versus $22 million in both the first quarter of 2026 and second quarter of 2025. As previously disclosed, the first and second quarters of 2026 include a full quarter of lease expense, net of reduced depreciation expense, of approximately $1.4 million from the Company's sale leaseback transaction executed in the fourth quarter of 2025. The second quarter of 2026 included a number of discrete expenses including $1.1 million related to the settlement of a previously disclosed mortgage lawsuit, $0.4 million increase of loan related expenses and $0.2 million higher marketing costs. There was also approximately $0.9 million cumulatively of smaller expenses related to the Company's recent shelf filing, BOLI exchange and core conversion project. Lastly, the Company is also in the beginning stages of deploying artificial intelligence tools and agents to drive ongoing productivity improvements in order to preserve operating leverage. Loan Portfolio and Asset Quality Loans held for investment increased to $3.5 billion at June 30, 2026 compared to $3.4 billion at March 31, 2026 and $3.1 billion at June 30, 2025. Primary drivers in these levels include: Core Bank loans averaged approximately $2.0 billion in the second quarter of 2026, flat from the first quarter of 2026 Panacea Financial loans grew $24 million, or 4%, through the end of second quarter of 2026 to $583 million excluding loans held for sale at June 30, 2026. Mortgage warehouse outstandings increased significantly to $544 million, or 18%, at the end of the second quarter of 2026 compared to $460 million at March 31, 2026.Mortgage portfolio loans generated by Primis Mortgage grew to $140 million at June 30, 2026, up 15% from $122 million at March 31, 2026 and up 132% from $67 million at June 30, 2025.Loan balances associated with the consumer loan program declined to $75 million at June 30, 2026, net of fair value discounts, compared to $113 million at June 30, 2025. Importantly, loans in promotional periods with full deferral now represent an immaterial amount of the portfolio which is amortizing down over time. Nonperforming assets, excluding portions guaranteed by the SBA, improved to 1.45% of total assets at June 30, 2026 compared to 2.35% of total assets at March 31, 2026 and 1.90% at June 30, 2025. The Company has made significant progress reducing nonperforming assets with total nonperforming assets decreasing to $63 million at June 30, 2026 from $100 million at March 31, 2026, representing a 37% reduction in the second quarter of 2026. The Company recorded a provision for credit losses of $5.5 million for the second quarter of 2026 compared to a provision for credit losses of $1.5 million for the first quarter of 2026 and $8.3 million for the second quarter of 2025. Approximately $5.3 million of the second quarter 2026 provision was related to specific reserve additions for one nonaccrual credit. Absent this amount, improvements in specific reserve amounts largely offset provision amounts related to portfolio growth and the consumer loan program. Core net charge-offs as a percentage of average loans were 53 basis points, up 38 basis points from the same period a year ago and up 47 basis points from the first quarter of 2026. The increase in net charge-offs was largely driven by one nonaccrual loan that was resolved in the second quarter of 2026. As a percentage of loans held for investment, the allowance for credit losses was 1.33% at the end of the second quarter of 2026 compared to 1.47% at the end of the second quarter of 2025. Deposits and Funding Total deposits at June 30, 2026 were $3.4 billion, up $0.1 billion, or 3.1% when compared to the same period in 2025. Noninterest bearing demand deposits were $506 million at June 30, 2026, an increase of 5.9% compared to balances at June 30, 2025. The Company had FHLB advances totaling $300 million outstanding at June 30, 2026, up from $25 million at December 31, 2025 and compared to no advances at June 30, 2025. Taxes Tax expense for the second quarter of 2026 was $2.7 million. Included in this expense was $0.8 million of tax expense related to the Panacea Financial Holdings deconsolidation in 2025 offset by $0.8 million of benefit from the purchase of certain tax credits. The Company expects the effective tax rate to be approximately 22% for the rest of 2026. Shareholders' Equity Tangible book value per common share(1) at the end of the second quarter of 2026 was $13.72, an increase of $2.24, or 19.5%, from levels reported at June 30, 2025. Tangible common equity(1) ended the second quarter of 2026 at $340.0 million, or 7.99% of tangible assets(1). The Board of Directors declared a dividend of $0.10 per share payable on August 21, 2026 to shareholders of record on August 7, 2026. This is Primis' fifty-ninth consecutive quarterly dividend. About Primis Financial Corp. As of June 30, 2026, Primis had $4.4 billion in total assets, $3.5 billion in total loans held for investment and $3.4 billion in total deposits. Primis Bank provides a range of financial services to individuals and small- and medium-sized businesses through twenty-four full-service branches in Virginia and Maryland and provides services to customers through certain online and mobile applications. Contacts: Address: Dennis J. Zember, Jr., President and CEO Primis Financial Corp. Matthew A. Switzer, EVP and CFO 1676 International Drive, Suite 900 Phone: (703) 893-7400 McLean, VA 22102 Primis Financial Corp., NASDAQ Symbol FRST Website: www.primisbank.com Conference Call The Company's management will host a conference call to discuss its second quarter results on Friday, July 24, 2026 at 10:00 a.m. (ET). A live webcast of the conference call is available at the following website: https://events.q4inc.com/attendee/499443631. Participants may also call 1-833-461-5787, enter meeting ID 499 443 631 and ask for the Primis Financial Corp. call. A replay of the teleconference will be available for 7 days using the webcast link above. Non-GAAP Measures Statements included in this press release include non-GAAP financial measures and should be read along with the accompanying tables. Primis uses non-GAAP financial measures to analyze its performance. The measures entitled operating net income (loss) available to Primis' common shareholders; pre-tax pre-provision operating earnings; operating return on average assets; pre-tax pre-provision operating return on average assets; operating return on average equity; operating return on average tangible equity; operating efficiency ratio; operating earnings per share – basic; operating earnings per share – diluted; core operating expense burden, tangible book value per share; tangible common equity; tangible common equity to tangible assets; and core net interest margin are not measures recognized under GAAP and therefore are considered non-GAAP financial measures. We use the term "operating" to describe a financial measure that excludes income or expense considered to be non-recurring in nature. Items identified as non-operating are those that, when excluded from a reported financial measure, provide management or the reader with a measure that may be more indicative of forward-looking trends in our business. A reconciliation of these non-GAAP financial measures to the most comparable GAAP measures is provided when discussing the financial measure or in the Reconciliation of Non-GAAP Items table. Management believes that these non-GAAP financial measures provide additional useful information about Primis that allows management and investors to evaluate the ongoing operating results, financial strength and performance of Primis and provide meaningful comparison to its peers. Non-GAAP financial measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider Primis' performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of Primis. Non-GAAP financial measures are not standardized and, therefore, it may not be possible to compare these measures with other companies that present measures having the same or similar names. Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the results or financial condition as reported under GAAP. Forward-Looking Statements This press release and certain of our other filings with the Securities and Exchange Commission contain statements that constitute "forward-looking statements" within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements. Such statements can generally be identified by such words as "may," "plan," "contemplate," "anticipate," "believe," "intend," "continue," "expect," "project," "predict," "estimate," "could," "should," "would," "will," and other similar words or expressions of the future or otherwise regarding the outlook for the Company's future business and financial performance and/or the performance of the banking industry and economy in general. These forward-looking statements include, but are not limited to, our expectations regarding our future operating and financial performance, including the preliminary estimated financial and operating information presented herein, which is subject to adjustment; our outlook and long-term goals for future growth and new offerings and services; our expectations regarding net interest margin; expectations on our growth strategy, expense management, capital management and future profitability; expectations on credit quality and performance; and the assumptions underlying our expectations. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties which may cause the actual results, performance or achievements of the Company to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are based on the information known to, and current beliefs and expectations of, the Company's management and are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements. Factors that might cause such differences include, but are not limited to: instability in global economic conditions and geopolitical matters; the impact of current and future economic and market conditions generally (including seasonality) and in the financial services industry, nationally and within our primary market areas; adverse developments in borrower industries; changes in interest rates, inflation, loan demand, real estate values, or competition, as well as labor shortages and supply chain disruptions; the impact of tariffs, trade policies, and trade wars (including reduced consumer spending, lower economic growth or recession, reduced demand for U.S. exports, disruptions to supply chains, and decreased demand for other banking products and services); the Company's ability to implement its various strategic and growth initiatives, including its recently established Panacea Financial Division, digital banking platform, V1BE fulfillment service, Mortgage Warehouse division and Primis Mortgage Company, as well as with respect to use and implementation of artificial intelligence; competitive pressures among financial institutions increasing significantly (including as a result of technological changes and the use of artificial intelligence); changes in applicable laws, rules, or regulations, including changes to statutes, regulations or regulatory policies or practices; legislative, regulatory or supervisory actions related to so‑called "de‑banking," including any new prohibitions, requirements or enforcement priorities that could affect customer relationships, compliance obligations, or operational practices; changes in management's plans for the future; credit risk associated with our lending activities; changes in accounting principles, policies, or guidelines; adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions; potential impacts of adverse developments in the banking industry, including impacts on customer confidence, deposit outflows, liquidity and the regulatory response thereto; potential increases in the provision for credit losses; our ability to identify and address increased cybersecurity risks, including those impacting vendors and other second parties; fraud or misconduct by internal or external actors, which we may not be able to prevent, detect or mitigate; acts of God or of war or other conflicts, civil unrest, acts of terrorism, pandemics or other catastrophic events that may affect general economic conditions; action or inaction by the federal government, including as a result of any prolonged government shutdown; and other general competitive, economic, political, and market factors, including those affecting our business, operations, pricing, products, or services. Forward-looking statements speak only as of the date on which such statements are made. These forward-looking statements are based upon information presently known to the Company's management and are inherently subjective, uncertain and subject to change due to any number of risks and uncertainties, including, without limitation, the risks and other factors set forth in the Company's filings with the Securities and Exchange Commission, the Company's Annual Report on Form 10-K for the year ended December 31, 2025, under the captions "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors," and in the Company's Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events. Readers are cautioned not to place undue reliance on these forward-looking statements. ___________ (1) Non-GAAP financial measure. Please see "Reconciliation of Non-GAAP Items" in the financial tables for more information and for a reconciliation to GAAP. Primis Financial Corp Financial Highlights (unaudited) (Dollars in thousands, except per share data) For Three Months Ended: For Six Months Ended: Selected Performance Ratios: 2Q 2026 1Q 2026 4Q 2025 3Q 2025 2Q 2025 2Q 2026 2Q 2025 Return on average assets 0.90 % 0.76 % 2.94 % 0.70 % 0.26 % 0.83 % 1.36 % Operating return on average assets(1) 0.53 % 0.84 % 0.23 % 0.70 % (0.34 %) 0.68 % 0.02 % Pre-tax pre-provision return on average assets 1.68 % 1.20 % 3.84 % 0.89 % 1.20 % 1.44 % 2.23 % Pre-tax pre-provision operating return on average assets(1) 1.12 % 1.20 % 0.39 % 0.89 % 0.44 % 1.15 % 0.57 % Return on average common equity 8.71 % 7.24 % 29.46 % 7.13 % 2.57 % 7.84 % 13.96 % Operating return on average common equity(1) 5.17 % 7.96 % 2.36 % 7.13 % (3.40 %) 6.56 % 0.19 % Operating return on average tangible common equity(1) 6.65 % 10.19 % 3.07 % 9.45 % (4.51 %) 8.38 % 0.26 % Cost of funds 2.46 % 2.46 % 2.52 % 2.62 % 2.67 % 2.46 % 2.67 % Net interest margin 3.45 % 3.43 % 3.28 % 3.18 % 2.86 % 3.44 % 3.00 % Gross loans to deposits 100.58 % 99.22 % 96.70 % 95.92 % 93.65 % 100.58 % 93.65 % Efficiency ratio 68.48 % 73.97 % 52.14 % 78.81 % 73.92 % 70.95 % 63.25 % Operating efficiency ratio(1) 76.51 % 73.97 % 91.05 % 78.81 % 88.67 % 70.95 % 90.27 % Per Common Share Data: Earnings per common share - Basic $ 0.38 $ 0.30 $ 1.20 $ 0.28 $ 0.10 $ 0.68 $ 1.01 Operating earnings per common share - Basic(1) $ 0.23 $ 0.33 $ 0.10 $ 0.28 $ (0.13) $ 0.55 $ 0.01 Earnings per common share - Diluted $ 0.38 $ 0.30 $ 1.20 $ 0.28 $ 0.10 $ 0.68 $ 1.01 Operating earnings per common share - Diluted(1) $ 0.23 $ 0.33 $ 0.10 $ 0.28 $ (0.13) $ 0.55 $ 0.01 Book value per common share $ 17.49 $ 17.25 $ 17.12 $ 15.51 $ 15.27 $ 17.49 $ 15.27 Tangible book value per common share(1) $ 13.72 $ 13.47 $ 13.34 $ 11.71 $ 11.48 $ 13.72 $ 11.48 Cash dividend per common share $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.20 $ 0.20 Weighted average shares outstanding - Basic 24,731,956 24,665,011 24,634,544 24,632,202 24,701,319 24,698,677 24,703,942 Weighted average shares outstanding - Diluted 24,788,023 24,719,255 24,654,037 24,643,889 24,714,229 24,751,058 24,718,458 Shares outstanding at end of period 24,799,072 24,772,072 24,695,385 24,644,385 24,643,185 24,799,072 24,643,185 Asset Quality Ratios: Non-performing assets as a percent of total assets, excluding SBA guarantees 1.45 % 2.35 % 2.03 % 2.07 % 1.90 % 1.45 % 1.90 % Net charge-offs (recoveries) as a percent of average loans (annualized) 0.65 % 0.12 % 0.16 % 0.14 % 0.80 % 0.41 % 1.13 % Core net charge-offs (recoveries) as a percent of average loans (annualized)(1) 0.53 % 0.06 % 0.05 % 0.03 % 0.15 % 0.30 % 0.11 % Allowance for credit losses to total loans 1.33 % 1.37 % 1.40 % 1.40 % 1.47 % 1.33 % 1.47 % Capital Ratios: Common equity to assets 9.96 % 10.04 % 10.45 % 9.66 % 9.72 % Tangible common equity to tangible assets(1) 7.99 % 8.02 % 8.33 % 7.48 % 7.49 % Leverage ratio(2) 8.63 % 8.76 % 8.80 % 8.32 % 8.34 % Common equity tier 1 capital ratio(2) 9.48 % 9.18 % 9.36 % 8.62 % 8.92 % Tier 1 risk-based capital ratio(2) 9.75 % 9.45 % 9.64 % 8.91 % 9.22 % Total risk-based capital ratio(2) 12.32 % 12.01 % 12.40 % 12.02 % 12.43 % (1) See Reconciliation of Non-GAAP financial measures (2) Ratios are estimated and may be subject to change pending the final filing of the FR Y-9C Primis Financial Corp (Dollars in thousands) For Three Months Ended: Condensed Consolidated Balance Sheets (unaudited) 2Q 2026 1Q 2026 4Q 2025 3Q 2025 2Q 2025 Assets Cash and cash equivalents $ 176,825 $ 159,881 $ 143,607 $ 63,881 $ 94,074 Investment securities-available for sale 168,285 171,877 171,377 234,660 242,073 Investment securities-held to maturity 6,588 6,792 6,981 8,550 8,850 Loans held for sale 231,990 223,180 166,066 202,372 126,869 Loans held for investment 3,466,388 3,396,366 3,283,683 3,200,234 3,130,521 Allowance for credit losses (45,964) (46,381) (45,883) (44,766) (45,985) Net loans 3,420,424 3,349,985 3,237,800 3,155,468 3,084,536 Stock in Federal Reserve Bank and Federal Home Loan Bank 27,487 24,162 14,185 17,035 12,998 Bank premises and equipment, net 5,955 5,924 6,070 19,380 19,642 Operating lease right-of-use assets 64,233 64,781 65,596 9,427 9,927 Goodwill and other intangible assets 93,482 93,488 93,495 93,502 93,508 Assets held for sale, net 776 776 776 775 2,181 Bank-owned life insurance 77,515 76,958 68,969 68,504 68,048 Deferred tax assets, net 15,914 14,593 14,683 17,328 19,466 Investment in Panacea Financial Holdings, Inc. common stock 7,299 6,899 6,899 6,880 6,586 Other assets 56,841 57,372 50,884 57,087 82,968 Total assets $ 4,353,614 $ 4,256,668 $ 4,047,388 $ 3,954,849 $ 3,871,726 Liabilities and stockholders' equity Demand deposits $ 505,758 $ 541,168 $ 554,442 $ 489,728 $ 477,705 NOW accounts 878,976 844,528 862,735 831,709 858,624 Money market accounts 794,540 778,366 740,886 737,634 744,321 Savings accounts 960,343 942,847 922,337 958,416 935,527 Time deposits 306,724 316,156 315,185 318,865 326,496 Total deposits 3,446,341 3,423,065 3,395,585 3,336,352 3,342,673 Securities sold under agreements to repurchase - short term 3,974 3,525 3,552 3,954 4,370 Federal Home Loan Bank advances 300,000 230,000 25,000 85,000 - Secured borrowings 14,165 14,450 14,773 15,403 16,449 Subordinated debt and notes 69,358 69,311 96,162 96,091 96,020 Operating lease liabilities 60,573 60,832 61,340 10,682 11,195 Other liabilities 25,374 28,287 28,080 25,214 24,604 Total liabilities 3,919,785 3,829,470 3,624,492 3,572,696 3,495,311 Total stockholders' equity 433,829 427,198 422,896 382,153 376,415 Total liabilities and stockholders' equity $ 4,353,614 $ 4,256,668 $ 4,047,388 $ 3,954,849 $ 3,871,726 Tangible common equity(1) $ 340,347 $ 333,710 $ 329,401 $ 288,651 $ 282,907 Primis Financial Corp (Dollars in thousands) For Three Months Ended: For Six Months Ended: Condensed Consolidated Statement of Operations (unaudited) 2Q 2026 1Q 2026 4Q 2025 3Q 2025 2Q 2025 2Q 2026 2Q 2025 Interest and dividend income $ 56,322 $ 53,526 $ 53,326 $ 51,766 $ 47,627 $ 109,848 $ 95,350 Interest expense 22,567 21,452 22,474 22,734 22,447 44,019 43,806 Net interest income 33,755 32,074 30,852 29,032 25,180 65,829 51,544 Provision for (recovery of) credit losses 5,452 1,549 2,439 (49) 8,303 7,001 9,899 Net interest income after provision for credit losses 28,303 30,525 28,413 29,081 16,877 58,828 41,645 Account maintenance and deposit service fees 1,699 1,246 1,292 1,358 1,675 2,945 3,014 Mortgage banking income 11,388 10,760 9,992 8,887 7,893 22,148 13,508 Gain on sale of loans 1,582 567 1,470 249 210 2,149 210 Gains on Panacea Financial Holdings investment 400 - 20 294 7,450 400 32,028 Gain on sale-leaseback - - 50,573 - - - - Loss on sales of investment securities - - (14,777) - - - - Gain (loss) on other investments 5,961 49 33 381 (308) 6,010 (255) Other 1,004 933 1,413 800 1,110 1,937 1,860 Noninterest income 22,034 13,555 50,016 11,969 18,030 35,589 50,365 Employee compensation and benefits 20,267 19,556 25,535 18,523 17,060 39,823 35,001 Occupancy and equipment expenses 4,799 4,617 4,459 3,481 3,127 9,416 6,412 Virginia franchise tax expense 695 611 577 576 577 1,306 1,154 FDIC Insurance assessment 854 738 918 999 1,021 1,592 1,814 Data processing expense 2,342 2,188 2,421 2,369 3,037 4,530 5,886 Marketing expense 934 760 472 450 720 1,694 1,234 Telecommunication and communication expense 350 311 352 309 324 661 611 Professional fees 2,886 1,860 3,730 2,509 2,413 4,746 4,638 Miscellaneous lending expenses 1,128 728 634 231 900 1,856 1,734 Other expenses 3,952 2,385 3,066 2,866 2,763 6,337 5,974 Noninterest expense 38,207 33,754 42,164 32,313 31,942 71,961 64,458 Income before income taxes 12,130 10,326 36,265 8,737 2,965 22,456 27,552 Income tax expense 2,704 3,014 6,725 1,907 528 5,718 6,081 Net Income 9,426 7,312 29,540 6,830 2,437 16,738 21,471 Noncontrolling interest - - - - - - 3,602 Net income available to Primis' common shareholders $ 9,426 $ 7,312 $ 29,540 $ 6,830 $ 2,437 $ 16,738 $ 25,073 (1) See Reconciliation of Non-GAAP financial measures Primis Financial Corp (Dollars in thousands) For Three Months Ended: Loan Portfolio Composition 2Q 2026 1Q 2026 4Q 2025 3Q 2025 2Q 2025 Loans held for sale $ 231,990 $ 223,180 $ 166,066 $ 202,372 $ 126,869 Loans secured by real estate: Commercial real estate - owner occupied 560,515 534,897 510,088 495,739 480,981 Commercial real estate - non-owner occupied 522,383 540,154 567,092 592,480 590,848 Secured by farmland 2,479 2,386 3,407 3,642 3,696 Construction and land development 153,906 151,426 131,757 102,227 106,443 Residential 1-4 family 558,782 560,711 576,866 564,087 571,206 Multi-family residential 137,953 150,475 140,261 137,804 157,097 Home equity lines of credit 61,985 61,786 61,738 62,458 62,103 Total real estate loans 1,998,003 2,001,835 1,991,209 1,958,437 1,972,374 Commercial loans 1,184,862 1,104,438 970,492 915,158 811,458 Paycheck Protection Program loans 1,713 1,716 1,719 1,723 1,729 Consumer loans 277,248 283,605 315,407 319,977 339,936 Total Non-PCD loans 3,461,826 3,391,594 3,278,827 3,195,295 3,125,497 PCD loans 4,562 4,772 4,856 4,939 5,024 Total loans receivable, net of deferred fees $ 3,466,388 $ 3,396,366 $ 3,283,683 $ 3,200,234 $ 3,130,521 (Dollars in thousands) For Three Months Ended: Loans by Risk Grade: 2Q 2026 1Q 2026 4Q 2025 3Q 2025 2Q 2025 Pass Grade 1 - Highest Quality $ 128 $ 119 $ 87 $ 666 $ 667 Pass Grade 2 - Good Quality 152,946 160,228 178,999 168,177 170,560 Pass Grade 3 - Satisfactory Quality 1,537,862 1,556,700 1,882,934 1,842,958 1,737,153 Pass Grade 4 - Pass 1,591,207 1,469,542 1,026,499 1,034,035 1,050,397 Pass Grade 5 - Pass/ Watch(1) 14,599 13,765 - - - Pass Grade 6 - Special Mention(2) 75,213 49,308 48,683 7,004 31,902 Grade 7 - Substandard(2) 86,884 139,155 138,932 139,847 139,842 Grade 8 - Doubtful(2) 7,549 7,549 7,549 7,547 - Grade 9 - Loss(2) - - - - - Total loans $ 3,466,388 $ 3,396,366 $ 3,283,683 $ 3,200,234 $ 3,130,521 (Dollars in thousands) For Three Months Ended: Asset Quality Information 2Q 2026 1Q 2026 4Q 2025 3Q 2025 2Q 2025 Allowance for Credit Losses: Balance at beginning of period $ (46,381) $ (45,883) $ (44,766) $ (45,985) $ (44,021) Recovery of (provision for) credit losses (5,452) (1,549) (2,439) 49 (8,303) Net charge-offs 5,869 1,051 1,322 1,170 6,339 Ending balance $ (45,964) $ (46,381) $ (45,883) $ (44,766) $ (45,985) Reserve for Unfunded Commitments: Balance at beginning of period $ (870) $ (1,006) $ (1,133) $ (1,152) $ (1,134) Recovery of (provision for) unfunded loan commitment reserve 39 136 127 19 (18) Total Reserve for Unfunded Commitments $ (831) $ (870) $ (1,006) $ (1,133) $ (1,152) Non-Performing Assets: 2Q 2026 1Q 2026 4Q 2025 3Q 2025 2Q 2025 Nonaccrual loans $ 61,847 $ 84,949 $ 84,823 $ 84,973 $ 53,059 Accruing loans delinquent 90 days or more 5,827 20,222 1,713 1,713 25,188 Total non-performing assets $ 67,674 $ 105,171 $ 86,536 $ 86,686 $ 78,247 SBA guaranteed portion of non-performing loans $ 4,491 $ 5,033 $ 4,482 $ 4,682 $ 4,750 (1) In first quarter of 2026. the Company expanded its risk grade matrix to include Pass Grade 5 - Pass/ Watch (2) In first quarter of 2026, due to the expansion of the risk grade matrix, Special Mention, Substandard, Doubtful and Loss loans that were in risk grades 5, 6, 7 and 8, respectively in 2025, were migrated to risk grades 6, 7, 8 and 9, respectively in 2026 Primis Financial Corp (Dollars in thousands) For Three Months Ended: For Six Months Ended: Average Balance Sheet 2Q 2026 1Q 2026 4Q 2025 3Q 2025 2Q 2025 2Q 2026 2Q 2025 Assets Loans held for sale $ 207,590 $ 159,007 $ 162,854 $ 130,061 $ 108,693 $ 183,433 $ 139,431 Loans, net of deferred fees 3,379,938 3,297,456 3,238,184 3,143,155 3,074,993 3,338,925 2,986,727 Investment securities 177,451 176,582 220,343 247,008 249,485 177,019 247,362 Other earning assets 164,006 161,199 115,908 101,278 98,369 162,611 92,457 Total earning assets 3,928,985 3,794,244 3,737,289 3,621,502 3,531,540 3,861,988 3,465,977 Other assets 272,805 261,466 244,183 232,636 272,910 267,167 252,469 Total assets $ 4,201,790 $ 4,055,710 $ 3,981,472 $ 3,854,138 $ 3,804,450 $ 4,129,155 $ 3,718,446 Liabilities and equity Demand deposits $ 565,815 $ 533,570 $ 498,681 $ 481,697 $ 467,493 $ 549,781 $ 457,007 Interest-bearing liabilities: NOW and other demand accounts 856,254 838,845 837,231 834,839 821,893 847,598 813,752 Money market accounts 777,265 750,380 740,915 756,361 759,107 763,896 773,507 Savings accounts 950,932 922,152 934,092 922,048 882,227 936,622 818,619 Time deposits 311,192 316,281 315,943 324,614 329,300 313,722 332,484 Total Deposits 3,461,458 3,361,228 3,326,862 3,319,559 3,260,020 3,411,619 3,195,369 Borrowings 219,946 181,185 205,767 117,697 117,701 200,672 117,330 Total Funding 3,681,404 3,542,413 3,532,629 3,437,256 3,377,721 3,612,291 3,312,699 Other Liabilities 86,339 86,090 50,978 36,720 36,649 86,216 37,461 Total liabilites 3,767,743 3,628,503 3,583,607 3,473,976 3,414,370 3,698,507 3,350,160 Primis common stockholders' equity 434,047 427,207 397,865 380,162 380,080 430,648 362,295 Noncontrolling interest — — — — - - 5,991 Total stockholders' equity 434,047 427,207 397,865 380,162 380,080 430,648 368,286 Total liabilities and stockholders' equity $ 4,201,790 $ 4,055,710 $ 3,981,472 $ 3,854,138 $ 3,794,450 $ 4,129,155 $ 3,718,446 Net Interest Income Loans held for sale $ 3,142 $ 2,376 $ 2,511 $ 2,085 $ 1,754 $ 5,518 $ 2,810 Loans 49,785 47,758 47,856 46,772 42,963 97,543 86,871 Investment securities 1,950 1,911 1,841 1,894 1,928 3,862 3,834 Other earning assets 1,445 1,481 1,118 1,015 982 2,925 1,835 Total Earning Assets Income 56,322 53,526 53,326 51,766 47,627 109,848 95,350 Non-interest bearing DDA - - - - - - - NOW and other interest-bearing demand accounts 4,446 4,244 4,124 4,549 4,603 8,690 9,118 Money market accounts 4,916 4,539 4,615 5,229 5,271 9,454 10,691 Savings accounts 7,575 7,202 7,599 8,070 7,793 14,777 14,211 Time deposits 2,451 2,517 2,639 2,723 2,830 4,969 5,869 Total Deposit Costs 19,388 18,502 18,977 20,571 20,497 37,890 39,889 Borrowings 3,179 2,950 3,497 2,163 1,950 6,129 3,917 Total Funding Costs 22,567 21,452 22,474 22,734 22,447 44,019 43,806 Net Interest Income $ 33,755 $ 32,074 $ 30,852 $ 29,032 $ 25,180 $ 65,829 $ 51,544 Net Interest Margin Loans held for sale 6.07 % 6.06 % 6.12 % 6.36 % 6.47 % 6.07 % 4.06 % Loans 5.91 % 5.87 % 5.86 % 5.90 % 5.60 % 5.89 % 5.87 % Investments 4.41 % 4.39 % 3.31 % 3.04 % 3.10 % 4.40 % 3.13 % Other Earning Assets 3.53 % 3.73 % 3.83 % 3.98 % 4.00 % 3.63 % 4.00 % Total Earning Assets 5.75 % 5.72 % 5.66 % 5.67 % 5.41 % 5.74 % 5.55 % NOW 2.08 % 2.05 % 1.95 % 2.16 % 2.25 % 2.07 % 2.26 % MMDA 2.54 % 2.45 % 2.47 % 2.74 % 2.79 % 2.50 % 2.79 % Savings 3.20 % 3.17 % 3.23 % 3.47 % 3.54 % 3.18 % 3.50 % CDs 3.16 % 3.23 % 3.31 % 3.33 % 3.45 % 3.19 % 3.56 % Cost of Interest Bearing Deposits 2.69 % 2.65 % 2.66 % 2.88 % 2.94 % 2.67 % 2.94 % Cost of Deposits 2.25 % 2.23 % 2.26 % 2.46 % 2.52 % 2.24 % 2.52 % Other Funding 5.80 % 6.60 % 6.74 % 7.29 % 6.65 % 6.16 % 6.73 % Total Cost of Funds 2.46 % 2.46 % 2.52 % 2.62 % 2.67 % 2.46 % 2.67 % Net Interest Margin 3.45 % 3.43 % 3.28 % 3.18 % 2.86 % 3.44 % 3.00 % Net Interest Spread 2.84 % 2.83 % 2.72 % 2.62 % 2.32 % 2.84 % 2.46 % Primis Financial Corp (Dollars in thousands, except per share data) For Three Months Ended: For Six Months Ended: Reconciliation of Non-GAAP items: 2Q 2026 1Q 2026 4Q 2025 3Q 2025 2Q 2025 2Q 2026 2Q 2025 Net income available to Primis' common shareholders $ 9,426 $ 7,312 $ 29,540 $ 6,830 $ 2,437 $ 16,738 $ 25,073 Non-GAAP adjustments to Net Income: Loss on sale of investment securities - - 14,777 - - - - Branch Consolidation / Other restructuring - - - - - - 144 Professional fee expense related to accounting matters and LPF sale - - - - 232 - 1,125 Gain on sale-leaseback - - (50,573) - - - - Transaction costs related to sale-leaseback - - 1,126 - - - - Gains on Panacea Financial Holdings investment - - - - (7,450) - (32,028) Loss on sale of closed bank branch buildings - - - - - - 107 Gain on investment in Bearing Insurance (5,853) - - - - (5,853) - Tax expense related to de-consolidation gain in 2025 on PFH investment 759 759 - - - 1,518 - Income tax effect 1,264 - 7,489 - 1,559 1,264 5,929 Operating net income (loss) available to Primis' common shareholders $ 5,596 $ 8,071 $ 2,359 $ 6,830 $ (3,222) $ 13,667 $ 350 Net income available to Primis' common shareholders $ 9,426 $ 7,312 $ 29,540 $ 6,830 $ 2,437 $ 16,738 $ 25,073 Income tax expense 2,704 3,014 6,725 1,907 528 5,718 6,081 Provision (benefit) for credit losses (incl. unfunded commitment expense/benefit) 5,413 1,413 2,312 (68) 8,321 6,826 9,930 Pre-tax pre-provision earnings $ 17,543 $ 11,739 $ 38,577 $ 8,669 $ 11,286 $ 29,282 $ 41,084 Effect of adjustment for nonrecurring income and expenses (5,853) - (34,670) - (7,218) (5,853) (30,652) Pre-tax pre-provision operating earnings $ 11,690 $ 11,739 $ 3,907 $ 8,669 $ 4,068 $ 23,429 $ 10,432 Return on average assets 0.90 % 0.76 % 2.94 % 0.70 % 0.26 % 0.83 % 1.36 % Effect of adjustment for nonrecurring income and expenses (0.37 %) 0.08 % (2.71 %) 0.00 % (0.60 %) (0.15 %) (1.34 %) Operating return on average assets 0.53 % 0.84 % 0.23 % 0.70 % (0.34 %) 0.68 % 0.02 % Return on average assets 0.90 % 0.76 % 2.94 % 0.70 % 0.26 % 0.83 % 1.36 % Effect of tax expense 0.26 % 0.30 % 0.67 % 0.20 % 0.06 % 0.28 % 0.33 % Effect of provision for credit losses (incl. unfunded commitment expense) 0.52 % 0.14 % 0.23 % (0.01 %) 0.88 % 0.33 % 0.54 % Pre-tax pre-provision return on average assets 1.68 % 1.20 % 3.84 % 0.89 % 1.20 % 1.44 % 2.23 % Effect of adjustment for nonrecurring income and expenses (0.56 %) 0.00 % (3.45 %) 0.00 % (0.76 %) (0.29 %) (1.66 %) Pre-tax pre-provision operating return on average assets 1.12 % 1.20 % 0.39 % 0.89 % 0.44 % 1.15 % 0.57 % Return on average common equity 8.71 % 7.24 % 29.46 % 7.13 % 2.57 % 7.84 % 13.96 % Effect of adjustment for nonrecurring income and expenses (3.54 %) 0.72 % (27.10 %) 0.00 % (5.97 %) (1.28 %) (13.77 %) Operating return on average common equity 5.17 % 7.96 % 2.36 % 7.13 % (3.40 %) 6.56 % 0.19 % Effect of goodwill and other intangible assets 1.48 % 2.23 % 0.71 % 2.32 % (1.11 %) 1.82 % 0.07 % Operating return on average tangible common equity 6.65 % 10.19 % 3.07 % 9.45 % (4.51 %) 8.38 % 0.26 % Efficiency ratio 68.48 % 73.97 % 52.14 % 78.81 % 73.92 % 70.95 % 63.25 % Effect of adjustment for nonrecurring income and expenses 8.03 % 0.00 % 38.91 % 0.00 % 14.75 % 0.00 % 27.02 % Operating efficiency ratio 76.51 % 73.97 % 91.05 % 78.81 % 88.67 % 70.95 % 90.27 % Earnings per common share - Basic $ 0.38 $ 0.30 $ 1.20 $ 0.28 $ 0.10 $ 0.68 $ 1.01 Effect of adjustment for nonrecurring income and expenses (0.15) 0.03 (1.10) - (0.23) (0.13) (1.00) Operating earnings per common share - Basic $ 0.23 $ 0.33 $ 0.10 $ 0.28 $ (0.13) $ 0.55 $ 0.01 Earnings per common share - Diluted $ 0.38 $ 0.30 $ 1.20 $ 0.28 $ 0.10 $ 0.68 $ 1.01 Effect of adjustment for nonrecurring income and expenses (0.15) 0.03 (1.10) - (0.23) (0.13) (1.00) Operating earnings per common share - Diluted $ 0.23 $ 0.33 $ 0.10 $ 0.28 $ (0.13) $ 0.55 $ 0.01 Book value per common share $ 17.49 $ 17.25 $ 17.12 $ 15.51 $ 15.27 $ 17.49 $ 15.27 Effect of goodwill and other intangible assets (3.77) (3.78) (3.78) (3.80) (3.79) (3.77) (3.79) Tangible book value per common share $ 13.72 $ 13.47 $ 13.34 $ 11.71 $ 11.48 $ 13.72 $ 11.48 Net charge-offs as a percent of average loans (annualized) 0.65 % 0.12 % 0.16 % 0.14 % 0.80 % 0.41 % 1.13 % Impact of third-party consumer portfolio (0.12 %) (0.06 %) (0.11 %) (0.11 %) (0.65 %) (0.11 %) (1.02 %) Core net charge-offs as a percent of average loans (annualized) 0.53 % 0.06 % 0.05 % 0.03 % 0.15 % 0.30 % 0.11 % Total Primis common stockholders' equity $ 433,829 $ 427,198 $ 422,896 $ 382,153 $ 376,415 $ 433,829 $ 376,415 Less goodwill and other intangible assets (93,482) (93,488) (93,495) (93,502) (93,508) (93,482) (93,508) Tangible common equity $ 340,347 $ 333,710 $ 329,401 $ 288,651 $ 282,907 $ 340,347 $ 282,907 Common equity to assets 9.96 % 10.04 % 10.45 % 9.66 % 9.72 % 9.96 % 9.72 % Effect of goodwill and other intangible assets (1.97 %) (2.02 %) (2.12 %) (2.18 %) (2.23 %) (1.97 %) (2.23 %) Tangible common equity to tangible assets 7.99 % 8.02 % 8.33 % 7.48 % 7.49 % 7.99 % 7.49 % View original content to download multimedia:https://www.prnewswire.com/news-releases/primis-financial-corp-reports-strong-results-for-the-second-quarter-of-2026-302833482.html SOURCE Primis Financial Corp. 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