Equibles

10-Q

Tompkins Financial Corp (TMP)

10-Q 2026-05-05 For: 2026-03-31
View Original
Added on May 05, 2026

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 March 31, 2026

OR

☐ 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 1-12709

Tompkins Financial logo Color.jpg

Tompkins Financial Corporation

(Exact name of registrant as specified in its charter)

New York 16-1482357
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)

118 E. Seneca Street, P.O. Box 460, Ithaca, NY

(Address of principal executive offices)

14851

(Zip Code)

Registrant’s telephone number, including area code: (888) 503-5753

Former name, former address, and former fiscal year, if changed since last report: NA

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, $0.10 par value TMP NYSE American, LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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. (Check one):

Large Accelerated Filer ☒ 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 Exchange Act.☐

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

Indicate the number of shares of the Registrant's Common Stock outstanding as of the latest practicable date: 14,382,941 shares as of April 30, 2026.

TOMPKINS FINANCIAL CORPORATION

FORM 10-Q

INDEX

PART I -FINANCIAL INFORMATION
PAGE
Item 1 – Financial Statements<br><br>Consolidated Statements of Condition as of March 31, 2026(Unaudited) and December 31, 2025(Audited) 1
Consolidated Statements of Income for the three months ended March 31, 2026and 2025(Unaudited) 2
Consolidated Statements of Comprehensive Income for the three months ended March 31, 2026and 2025(Unaudited) 3
Consolidated Statements of Cash Flows for the three months ended March 31, 2026and 2025(Unaudited) 4
Consolidated Statements of Changes in Shareholders’ Equity for the three months ended March 31, 2026and 2025(Unaudited) 6
Notes to Unaudited Consolidated Financial Statements 7
Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations 34
Item 3 - Quantitative and Qualitative Disclosures About Market Risk 50
Item 4 - Controls and Procedures 51
PART II - OTHER INFORMATION
Item 1 – Legal Proceedings 51
Item 1A – Risk Factors 51
Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds 51
Item 3 - Defaults Upon Senior Securities 52
Item 4 - Mine Safety Disclosures 52
Item 5 - Other Information 52
Item 6- Exhibits 52
SIGNATURES 54

Glossary of Abbreviations and Acronyms

The acronyms and abbreviations identified below are used throughout this report, including the Notes to Consolidated Financial Statements. You may find it helpful to refer to this page as you read this report. All references in the glossary to laws are to those laws as amended from time to time.

Term Definition
ACL Allowance for credit losses
AFS Available for sale
ASC Accounting Standards Codification
ASU Accounting Standards Update
BHC Act Bank Holding Company Act of 1956
BOLI Bank owned life insurance
CECL Current Expected Credit Losses
CRE Commercial real estate
DIF Deposit Insurance Fund
Dodd-Frank Act Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010
ECL Expected credit losses
ESOP Employee Stock Ownership Plan
Exchange Act Securities Exchange Act of 1934
FASB Financial Accounting Standards Board
FDIC Federal Deposit Insurance Corporation
FHLB Federal Home Loan Bank
FHLBNY Federal Home Loan Bank of New York
FHLMC Federal Home Loan Mortgage Corporation
FRB Federal Reserve Board
GAAP U.S. Generally Accepted Accounting Principles
HTM Held to maturity
NYSDFS New York State Department of Financial Services
OREO Other real estate owned
PCA Prompt corrective action
PCD Purchased with credit deterioration
PCI Purchased credit impaired
ROU Right-of-use
Sarbanes-Oxley Sarbanes-Oxley Act of 2002
SBIC Small business investment companies
SEC Securities and Exchange Commission
Securities Act Securities Act of 1933
SERP Supplemental employee retirement plan
SONYMA State of New York Mortgage Agency
TDR Troubled debt restructuring
Tompkins Annual Report Tompkins Annual Report on Form 10-K for the year ended December 31, 2024
TIA Tompkins Insurance Agencies, Inc.
Tompkins or the Company Tompkins Financial Corporation

Item 1. Financial Statements

TOMPKINS FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CONDITION

(In thousands, except share and per share data)(unaudited) As of As of
ASSETS 03/31/2026 12/31/2025
(unaudited) (audited)
Cash and noninterest bearing balances due from banks $ 68,665 $ 50,717
Interest bearing balances due from banks 102,784 82,100
Cash and Cash Equivalents 171,449 132,817
Available-for-sale debt securities, at fair value (amortized cost of $1,407,770 at March 31, 2026 and $1,391,379 at December 31, 2025) 1,388,910 1,382,068
Held-to-maturity debt securities, at amortized cost (fair value of $282,589 at March 31, 2026 and $283,860 at December 31, 2025) 312,545 312,528
Equity securities, at fair value 795 800
Loans held for sale 54 43,440
Total loans and leases, net of unearned income and deferred costs and fees 6,477,943 6,446,245
Less: Allowance for credit losses 58,108 57,671
Net Loans and Leases 6,419,835 6,388,574
Federal Home Loan Bank and other stock 27,189 32,307
Bank premises and equipment, net 71,000 72,418
Corporate owned life insurance 78,490 77,843
Goodwill 72,736 72,736
Accrued interest and other assets 152,758 152,737
Total Assets $ 8,695,761 $ 8,668,268
LIABILITIES
Deposits:
Interest bearing:
Checking, savings and money market 3,889,995 3,742,402
Time 1,292,391 1,298,393
Noninterest bearing 1,871,786 1,896,967
Total Deposits 7,054,172 6,937,762
Federal funds purchased and securities sold under agreements to repurchase 118,133 95,569
Other borrowings 449,446 564,446
Other liabilities 127,269 132,114
Total Liabilities $ 7,749,020 $ 7,729,891
EQUITY
Shareholders' equity:
Common Stock - par value $0.10 per share: Authorized 25,000,000 shares; Issued: 14,420,973 at March 31, 2026; and 14,449,845 at December 31, 2025 1,443 1,446
Additional paid-in capital 297,181 299,206
Retained earnings 678,575 662,161
Accumulated other comprehensive loss (26,098) (19,054)
Treasury stock, at cost – 88,982 shares at March 31, 2026, and 104,492 shares at December 31, 2025 (4,360) (5,382)
Total Equity $ 946,741 $ 938,377
Total Liabilities and Equity $ 8,695,761 $ 8,668,268

See notes to unaudited consolidated financial statements.

TOMPKINS FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

Three Months Ended
(In thousands, except per share data) (Unaudited) 03/31/2026 03/31/2025
INTEREST AND DIVIDEND INCOME
Loans $ 87,123 $ 78,630
Due from banks 166 175
Available-for-sale debt securities 13,702 8,729
Held-to-maturity debt securities 1,218 1,217
Federal Home Loan Bank and other stock 460 711
Total Interest and Dividend Income 102,669 89,462
INTEREST EXPENSE
Time certificates of deposits of $250,000 or more 4,478 4,507
Other deposits 21,531 22,143
Federal funds purchased and securities sold under agreements to repurchase 18 41
Other borrowings 4,781 6,109
Total Interest Expense 30,808 32,800
Net Interest Income 71,861 56,662
Less: Provision for credit loss expense 1,502 5,287
Net Interest Income After Provision for Credit Loss Expense 70,359 51,375
NONINTEREST INCOME
Insurance commissions and fees 0 11,599
Wealth management fees 5,266 5,119
Service charges on deposit accounts 1,795 1,805
Card services income 2,642 2,626
Other income 2,136 3,869
Net gain (loss) on securities transactions (5) 14
Total Noninterest Income 11,834 25,032
NONINTEREST EXPENSE
Salaries and wages 21,948 24,977
Other employee benefits 6,807 7,100
Net occupancy expense of premises 3,455 3,570
Furniture and fixture expense 2,027 1,787
Other operating expense 13,489 13,173
Total Noninterest Expenses 47,726 50,607
Income Before Income Tax Expense 34,467 25,800
Income Tax Expense 8,393 6,121
Net Income $ 26,074 $ 19,679
Basic Earnings Per Share $ 1.83 $ 1.38
Diluted Earnings Per Share $ 1.82 $ 1.37

See notes to unaudited consolidated financial statements.

TOMPKINS FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three Months Ended
(In thousands) (Unaudited) 03/31/2026 03/31/2025
Net income $ 26,074 $ 19,679
Other comprehensive (loss) income, net of tax:
Available-for-sale debt securities:
Change in net unrealized gain (loss) during the period (7,162) 16,117
Employee benefit plans:
Amortization of net retirement plan actuarial loss 82 128
Amortization of net retirement plan prior service cost 36 37
Other comprehensive income (loss) (7,044) 16,282
Total comprehensive income $ 19,030 $ 35,961

See notes to unaudited consolidated financial statements.

TOMPKINS FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended
(In thousands) (Unaudited) 03/31/2026 03/31/2025
OPERATING ACTIVITIES
Net income $ 26,074 $ 19,679
Adjustments to reconcile net income to cash provided by (used in) operating activities:
Provision for credit loss expense 1,502 5,287
Depreciation and amortization of premises, equipment, and software 2,307 2,195
Amortization of intangible assets 0 84
Earnings from corporate owned life insurance (645) (615)
Net amortization on securities (2,858) (393)
Amortization/accretion related to purchase accounting (60) (63)
Current year tax liability 6,606 5,788
Net (gain) loss on securities transactions 5 (14)
Net gain on sale of loans originated for sale (705) (454)
Proceeds from sale of loans originated for sale 25,124 12,036
(Increase)/decrease in loans originated for sale (19,652) (11,300)
(Increase)/decrease in loans held for sale 43,386 0
Net gain on sale of bank premises and equipment (34) 27
Stock-based compensation expense 877 943
Increase in accrued interest receivable (1,361) (48)
Increase in accrued interest payable (577) (532)
Other, net (6,553) (10,395)
Net Cash Provided by Operating Activities 73,436 22,225
INVESTING ACTIVITIES
Proceeds from maturities, calls and principal paydowns of available-for-sale debt securities 48,499 29,979
Purchases of available-for-sale debt securities (62,049) (35,922)
Net increase in loans (36,801) (47,398)
Proceeds from sale/redemptions of Federal Home Loan Bank stock 30,538 36,258
Purchases of Federal Home Loan Bank and other stock (25,419) (23,130)
Proceeds from sale of bank premises and equipment 51 0
Purchases of bank premises, equipment and software (2,330) (1,353)
Purchase of corporate owned life insurance (2) 0
Proceeds from sale of other real estate owned 0 16,131
Net Cash (Used in) Provided by Investing Activities (47,513) (25,435)
FINANCING ACTIVITIES
Net increase in demand, money market, and savings deposits 122,412 166,524
Net (decrease) increase in time deposits (5,944) 115,234
Net increase in Federal funds purchased and securities sold under agreements to repurchase 22,564 85,949
Increase in other borrowings 0 48,000
Repayment of other borrowings (115,000) (345,000)
Cash dividends (9,547) (8,833)
Common stock issued 42 28
Repurchase of common stock (1,816) 0
Net shares issued related to restricted stock awards 0 (25)
Net proceeds from exercise of stock options (2) 0
Net Cash Provided by (Used in) Financing Activities 12,709 61,877
Net Increase in Cash and Cash Equivalents 38,632 58,667
Cash and cash equivalents, beginning of the period 132,817 134,398
Total Cash and Cash Equivalents at End of Period $ 171,449 $ 193,065

See notes to unaudited consolidated financial statements.

TOMPKINS FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended
(In thousands) (Unaudited) 03/31/2026 03/31/2025
Supplemental Information:
Cash paid during the year for - Interest $ 31,443 $ 33,392
Cash paid during the year for - Taxes 1,716 273
Transfer of loans to other real estate owned 40 0
Right-of-use assets obtained in exchange for new lease liabilities 16 1,496

See notes to unaudited consolidated financial statements.

TOMPKINS FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(In thousands except share and per share data)(Unaudited) Additional Paid-in Capital Retained<br>Earnings Accumulated Other Comprehensive (Loss) Income Treasury<br>Stock Total
Balances at January 1, 2025 1,447 $ 300,073 $ 537,157 $ (118,492) $ (6,741) $ 713,444
Net income 19,679 19,679
Other comprehensive income 16,282 16,282
Total Comprehensive Income 35,961
Cash dividends (0.62 per share) (8,949) (8,949)
Treasury stock issued (549 shares) 28 7 35
Stock-based compensation expense 911 911
Directors deferred compensation plan (34,588 shares) (1,974) 1,974 0
Restricted stock activity (3,039 shares) (25) (25)
Balances at March 31, 2025 1,447 $ 299,013 $ 547,887 $ (102,210) $ (4,760) $ 741,377
Balances at January 1, 2026 1,446 $ 299,206 $ 662,161 $ (19,054) $ (5,382) $ 938,377
Net income 26,074 26,074
Other comprehensive loss (7,044) (7,044)
Total Comprehensive Income 19,030
Cash dividends (0.67 per share) (9,660) (9,660)
Net exercise of stock options (36 shares) (2) (2)
Common stock repurchased and returned to unissued status (23,731 shares) (1,814) (1,816)
Treasury Stock (714 shares) 42 9 51
Stock-based compensation expense 761 761
Directors deferred compensation plan (14,796 shares) (1,013) 1,013 0
Restricted stock activity (5,177 shares) 1 0
Balances at March 31, 2026 1,443 $ 297,181 $ 678,575 $ (26,098) $ (4,360) $ 946,741

All values are in US Dollars.

See notes to unaudited consolidated financial statements.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

  1. Business

Tompkins Financial Corporation ("Tompkins" or the "Company") is headquartered in Ithaca, New York and is registered as a Financial Holding Company with the Federal Reserve Board under the Bank Holding Company Act of 1956, as amended. The Company is a locally oriented, community-based financial services organization that offers a full array of financial products and services, including commercial and consumer banking, leasing, trust and investment management, and financial planning and wealth management. At March 31, 2026, the Company had one wholly-owned banking subsidiary, Tompkins Community Bank. Tompkins Community Bank provides a broad selection of trust and wealth management services under the Tompkins Financial Advisors brand, including investment management, trust and estate, and financial and tax planning services. On October 31, 2025, the Company sold all of the issued and outstanding shares of capital stock of its insurance subsidiary, Tompkins Insurance Agencies, Inc. ("TIA"), to Arthur J. Gallagher Risk Management Services, LLC ("Gallagher"). The Company’s principal offices are located at 118 E. Seneca Street, Ithaca, New York, 14850, and its telephone number is (888) 503-5753. The Company’s common stock is traded on the NYSE American under the symbol "TMP."

As a registered financial holding company, the Company is regulated under the Bank Holding Company Act of 1956 ("BHC Act"), as amended and is subject to examination and comprehensive regulation by the Federal Reserve Board ("FRB"). The Company is also subject to the jurisdiction of the Securities and Exchange Commission ("SEC") and is subject to disclosure and regulatory requirements under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. The Company is subject to the rules of the NYSE American for listed companies.

Tompkins Community Bank is subject to examination and comprehensive regulation by various regulatory authorities, including the Federal Deposit Insurance Corporation ("FDIC"), and the New York State Department of Financial Services ("NYSDFS"). Each of these agencies issues regulations and requires the filing of reports describing the activities and financial condition of the entities under its jurisdiction. Likewise, such agencies conduct examinations on a recurring basis to evaluate the safety and soundness of the institutions, and to test compliance with various regulatory requirements, including: consumer protection, privacy, fair lending, the Community Reinvestment Act, the Bank Secrecy Act, sales of non-deposit investments, electronic data processing, and trust department activities. These agencies also examine and regulate the trust business of Tompkins Community Bank.

  1. Basis of Presentation

The unaudited consolidated financial statements included in this quarterly report do not include all of the information and footnotes required by U.S. Generally Accepted Accounting Principles ("GAAP") for a full year presentation and certain disclosures have been condensed or omitted in accordance with rules and regulations of the SEC. In the application of certain accounting policies, management is required to make assumptions regarding the effect of matters that are inherently uncertain. These estimates and assumptions affect the reported amounts of certain assets, liabilities, revenues, and expenses in the unaudited consolidated financial statements. Different amounts could be reported under different conditions, or if different assumptions were used in the application of these accounting policies. The accounting policy that management considers critical in this respect is the determination of the allowance for credit losses. The Company has evaluated subsequent events for potential recognition and/or disclosure as of the date of these unaudited consolidated financial statements, and determined that no further disclosures were required.

In management’s opinion, the unaudited consolidated financial statements reflect all adjustments of a normal recurring nature. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year ended December 31, 2026. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

Cash and cash equivalents in the consolidated statements of cash flow include cash and noninterest bearing balances due from banks, interest-bearing balances due from banks, and money market funds. Management regularly evaluates the credit risk associated with the counterparties to these transactions and believes that the Company is not exposed to any significant credit risk on cash and cash equivalents.

Accounting Standards Pending Adoption

ASU No. 2023-06, "Disclosure Improvements" amends the disclosure or presentation requirements related to various subtopics in the FASB Accounting Standards Codification. The new guidance is intended to align GAAP requirements with those of the SEC. The ASU will become effective on the earlier of the date on which the SEC removes its related disclosure requirements

from Regulation S-X or Regulation S-K, or June 30, 2027. Early adoption is prohibited. Adoption of ASU 2023-06 is not expected to have a material impact on our consolidated financial statements.

ASU No. 2024-03, "Disaggregation of Income Statement Expenses" requires new financial statement disclosures in tabular format, disaggregating information about prescribed categories underlying any relevant income statement expense captions, including employee compensation, depreciation, and intangible asset amortization. Tompkins is required to adopt this ASU prospectively for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption and retrospective application are permitted. Tompkins is currently evaluating the potential impact of ASU 2024-03 on our consolidated financial statements.

ASU No. 2025-11, "Interim Reporting (Topic 270): Narrow-Scope Improvements" was issued to improve the guidance within Topic 270, Interim Reporting, by clarifying applicability of the requirements. This guidance is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. Tompkins is currently evaluating the potential impact of ASU 2025-11 on our consolidated financial statements.

ASU No. 2025-12, "Codification Improvements" addresses suggestions received from stakeholders on the Accounting Standards Codification and to make other incremental improvements to generally accepted accounting principles (GAAP). This ASU is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. Adoption is not expected to have a material impact on our consolidated financial statements.

The Company reviews new accounting standards as issued. Management has not identified any other new standards that it believes will have a significant impact on the Company’s financial statements.

  1. Securities

Available-for-Sale Debt Securities

The following table summarizes available-for-sale debt securities held by the Company at March 31, 2026 and December 31, 2025:

(In thousands) Amortized<br>Cost Gross<br>Unrealized<br>Gains Gross<br>Unrealized<br>Losses Fair Value
March 31, 2026
U.S. Treasuries $ 45,577 $ 131 $ 1,966 $ 43,742
Obligations of U.S. Government sponsored entities 348,769 4,052 12,312 340,509
Obligations of U.S. states and political subdivisions 80,622 5 5,986 74,641
Mortgage-backed securities – residential, issued by
U.S. Government agencies 308,634 358 2,537 306,455
U.S. Government sponsored entities 621,668 4,863 5,419 621,112
U.S. corporate debt securities 2,500 0 49 2,451
Total available-for-sale debt securities $ 1,407,770 $ 9,409 $ 28,269 $ 1,388,910
December 31, 2025
U.S. Treasuries $ 55,492 $ 213 $ 1,925 $ 53,780
Obligations of U.S. Government sponsored entities 354,128 5,928 11,653 348,403
Obligations of U.S. states and political subdivisions 81,517 7 5,214 76,310
Mortgage-backed securities – residential, issued by
U.S. Government agencies 315,001 852 2,357 313,496
U.S. Government sponsored entities 582,741 6,712 1,821 587,632
U.S. corporate debt securities 2,500 0 53 2,447
Total available-for-sale debt securities $ 1,391,379 $ 13,712 $ 23,023 $ 1,382,068

Held-to-Maturity Debt Securities

The following table summarizes held-to-maturity debt securities held by the Company at March 31, 2026 and December 31, 2025:

(In thousands) Amortized<br>Cost Gross<br>Unrealized<br>Gains Gross<br>Unrealized<br>Losses Fair Value
March 31, 2026
U.S. Treasuries $ 85,775 $ 0 $ 7,347 $ 78,428
Obligations of U.S. Government sponsored entities 226,770 0 22,609 204,161
Total held-to-maturity debt securities $ 312,545 $ 0 $ 29,956 $ 282,589
December 31, 2025
U.S. Treasuries $ 85,831 $ 0 $ 7,037 $ 78,794
Obligations of U.S. Government sponsored entities 226,697 0 21,631 205,066
Total held-to-maturity debt securities $ 312,528 $ 0 $ 28,668 $ 283,860

The Company may from time to time sell debt securities from its available-for-sale portfolio. There were no sales of available-for-sale debt securities for the three months ended March 31, 2026 or the three months ended March 31, 2025. The Company's available-for-sale portfolio includes callable securities that may be called prior to maturity. There were no realized gains (losses) on called available-for-sale debt securities for the three months ended March 31, 2026 or the three months ended March 31, 2025. The Company also recognized net losses on equity securities of $5,000 for the three months ended March 31, 2026 and net gains of $14,000 for the same period during 2025, reflecting the change in fair value.

The following table summarizes available-for-sale debt securities that had unrealized losses at March 31, 2026 and December 31, 2025:

Less than 12 Months 12 Months or Longer Total
(In thousands) Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses
March 31, 2026
U.S. Treasuries $ 0 $ 0 $ 28,906 $ 1,966 $ 28,906 $ 1,966
Obligations of U.S. Government sponsored entities 26,669 189 141,157 12,123 167,826 12,312
Obligations of U.S. states and political subdivisions 9,391 56 61,099 5,930 70,490 5,986
Mortgage-backed securities – residential, issued by
U.S. Government agencies 187,441 2,289 11,620 248 199,061 2,537
U.S. Government sponsored entities 422,096 4,976 7,889 443 429,985 5,419
U.S. corporate debt securities 0 0 2,451 49 2,451 49
Total available-for-sale debt securities $ 645,597 $ 7,510 $ 253,122 $ 20,759 $ 898,719 $ 28,269
December 31, 2025
U.S. Treasuries $ 0 $ 0 $ 38,936 $ 1,925 $ 38,936 $ 1,925
Obligations of U.S. Government sponsored entities 0 0 141,606 11,653 141,606 11,653
Obligations of U.S. states and political subdivisions 2,530 2 65,279 5,212 67,809 5,214
Mortgage-backed securities – residential, issued by
U.S. Government agencies 179,250 2,129 12,051 228 191,301 2,357
U.S. Government sponsored entities 291,424 1,452 7,990 369 299,414 1,821
U.S. corporate debt securities 0 0 2,447 53 2,447 53
Total available-for-sale debt securities $ 473,204 $ 3,583 $ 268,309 $ 19,440 $ 741,513 $ 23,023

The following table summarizes held-to-maturity debt securities that had unrealized losses at March 31, 2026 and December 31, 2025:

Less than 12 Months 12 Months or Longer Total
(In thousands) Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses
March 31, 2026
U.S. Treasuries $ 0 $ 0 $ 78,428 $ 7,347 $ 78,428 $ 7,347
Obligations of U.S. Government sponsored entities 0 0 204,161 22,609 204,161 22,609
Total held-to-maturity debt securities $ 0 $ 0 $ 282,589 $ 29,956 $ 282,589 $ 29,956
December 31, 2025
U.S. Treasuries $ 0 $ 0 $ 78,794 $ 7,037 $ 78,794 $ 7,037
Obligations of U.S. Government sponsored entities 0 0 205,066 21,631 205,066 21,631
Total held-to-maturity debt securities $ 0 $ 0 $ 283,860 $ 28,668 $ 283,860 $ 28,668

The Company evaluates available-for-sale debt securities for expected credit losses ("ECL") in unrealized loss positions at each measurement date to determine whether the decline in the fair value below the amortized cost basis is due to credit-related factors or noncredit-related factors.

Factors that may be indicative of ECL include, but are not limited to, the following:

•Extent to which the fair value is less than the amortized cost basis.

•Adverse conditions specifically related to the security, an industry, or geographic area (changes in technology, business practice).

•Payment structure of the debt security with respect to underlying issuer or obligor.

•Failure of the issuer to make scheduled payment of principal and/or interest.

•Changes to the rating of a security or issuer by a nationally recognized statistical rating organization.

•Changes in tax or regulatory guidelines that impact a security or underlying issuer.

For available-for-sale debt securities in an unrealized loss position, the Company evaluates the securities to determine whether the decline in the fair value below the amortized cost basis is the result of changes in interest rates or reflects a fundamental change in the creditworthiness of the underlying issuer. Any impairment that is not credit related is recognized in other comprehensive income (loss), net of applicable taxes. Credit-related impairment is recognized as an allowance for credit losses ("ACL") on the Consolidated Statements of Condition, limited to the amount by which the amortized cost basis exceeds the fair value, with a corresponding adjustment to earnings. Both the ACL and the adjustment to net income may be reversed if conditions change.

Management measures expected credit losses on held-to-maturity debt securities on a collective basis by major security type with each type sharing similar risk characteristics and considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. Management has made the accounting policy election to exclude accrued interest receivable on held-to-maturity debt securities from the estimate of credit losses. As of March 31, 2026, the held-to- maturity portfolio consisted of U.S. Treasury securities and securities issued by U.S. government-sponsored enterprises, including the Federal National Mortgage Agency and the Federal Farm Credit Banks Funding Corporation. U.S. Treasury securities are backed by the full faith and credit of and/or guaranteed by the U.S. government, and it is expected that the securities will not be settled at prices less than the amortized cost bases of the securities. Securities issued by U.S. government agencies or U.S. government-sponsored enterprises carry the explicit and/or implicit guarantee of the U.S. government, are widely recognized as "low-risk," and have a long history of zero credit loss. As such, the Company did not record an allowance for credit losses for these securities as of March 31, 2026 or December 31, 2025.

The gross unrealized losses reported for residential mortgage-backed securities relate to investment securities issued by U.S. government sponsored entities such as Federal National Mortgage Association, Federal Home Loan Mortgage Corporation, and U.S. government agencies such as Government National Mortgage Association. The total gross unrealized losses, shown in the tables above, were primarily attributable to changes in interest rates and levels of market liquidity, relative to when the investment securities were purchased, and not due to the credit-related quality of the investment securities. The Company does

not have the intent to sell these securities and does not believe it is more likely than not that the Company will be required to sell these securities before a recovery of amortized cost.

The Company did not recognize any net credit impairment charge to earnings on investment securities in the first quarter of 2026 or the first quarter of 2025.

The amortized cost and estimated fair value of debt securities by contractual maturity are shown in the following table. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Mortgage-backed securities are shown separately since they are not due at a single maturity date.

March 31, 2026 December 31, 2025
(In thousands) Amortized Cost Fair Value Amortized Cost Fair Value
Available-for-sale debt securities:
Due in one year or less $ 62,719 $ 62,637 $ 74,224 $ 74,109
Due after one year through five years 229,088 220,345 238,913 231,336
Due after five years through ten years 185,661 178,361 180,500 175,495
Total 477,468 461,343 493,637 480,940
Mortgage-backed securities 930,302 927,567 897,742 901,128
Total available-for-sale debt securities $ 1,407,770 $ 1,388,910 $ 1,391,379 $ 1,382,068 March 31, 2026 December 31, 2025
--- --- --- --- --- --- --- --- ---
(In thousands) Amortized Cost Fair Value Amortized Cost Fair Value
Held-to-maturity debt securities:
Due after one year through five years $ 189,679 $ 173,185 $ 174,870 $ 160,547
Due after five years through ten years 122,866 109,404 137,658 123,313
Total held-to-maturity debt securities $ 312,545 $ 282,589 $ 312,528 $ 283,860

The Company also holds non-marketable Federal Home Loan Bank New York ("FHLBNY") stock and non-marketable Atlantic Community Bankers Bank ("ACBB") stock, all of which are required to be held for regulatory purposes and for borrowing availability. The required investment in Federal Home Loan Bank ("FHLB") stock is tied to the Company’s borrowing levels with the FHLB. Holdings of FHLBNY stock and ACBB stock totaled $27.1 million and $95,000, respectively, at March 31, 2026 compared to $32.2 million and $95,000, respectively, at December 31, 2025. These securities are carried at par, which is also cost. The FHLBNY continues to pay dividends and repurchase stock. Quarterly, we evaluate our investment in the FHLB for impairment. We evaluate recent and long-term operating performance, liquidity, funding and capital positions, stock repurchase history, dividend history and impact of legislative and regulatory changes. Based on our most recent evaluation, as of March 31, 2026, we determined that no impairment write-downs were required.

  1. Loans and Leases

Loans and Leases at March 31, 2026 and December 31, 2025 were as follows:

(In thousands) 03/31/2026 12/31/2025
Commercial and industrial
Agriculture $ 104,534 $ 114,475
Commercial and industrial other 1,013,267 986,173
Subtotal commercial and industrial 1,117,801 1,100,648
Commercial real estate
Construction 471,378 448,901
Agriculture 238,165 234,292
Commercial real estate other 2,972,270 2,978,842
Subtotal commercial real estate 3,681,813 3,662,035
Residential real estate
Home equity 229,927 227,654
Mortgages 1,359,102 1,363,532
Subtotal residential real estate 1,589,029 1,591,186
Consumer and other
Indirect 58 68
Consumer and other 83,609 86,399
Subtotal consumer and other 83,667 86,467
Leases 9,653 10,413
Total loans and leases 6,481,963 6,450,749
Less: unearned income and deferred costs and fees (4,020) (4,504)
Total loans and leases, net of unearned income and deferred costs and fees $ 6,477,943 $ 6,446,245

The Company has adopted comprehensive lending policies, underwriting standards and loan review procedures. Management reviews these policies and procedures on a regular basis. The Company discussed its lending policies and underwriting guidelines for its various lending portfolios in Note 4 – "Loans and Leases" in the Notes to Consolidated Financial Statements contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. There have been no significant changes in these policies and guidelines since the date of that report. The Company’s Board of Directors approves the lending policies at least annually. The Company recognizes that exceptions to policy guidelines may occasionally occur and has established procedures for approving exceptions to these policy guidelines. Management has also implemented reporting systems to monitor loan origination, loan quality, concentrations of credit, loan delinquencies and nonperforming loans and potential problem loans.

Loans are considered past due if the required principal and interest payments have not been received as of the date such payments are due. Generally loans are placed on nonaccrual status if principal or interest payments become 90 days or more contractually past due and/or management deems the collectability of the principal and/or interest to be in question as well as when required by regulatory agencies. When interest accrual is discontinued, all unpaid accrued interest is reversed. Payments received on loans on nonaccrual are generally applied to reduce the principal balance of the loan. Loans are generally returned to accrual status when all the principal and interest amounts contractually due are brought current, the borrower has established a payment history, and future payments are reasonably assured. When management determines that the collection of principal in full is not probable, management will charge-off a partial amount or full amount of the loan balance. Management considers specific facts and circumstances relative to each individual credit in making such a determination. For residential and consumer loans, management uses specific regulatory guidance and thresholds for determining charge-offs.

The below tables are an age analysis of past due loans, segregated by class of loans as of March 31, 2026 and December 31, 2025:

March 31, 2026
(In thousands) 30-59 Days 60-89 Days 90 Days or More Total Past Due Current Loans Total Loans
Loans and Leases
Commercial and industrial
Agriculture $ 564 $ 0 $ 0 $ 564 $ 103,970 $ 104,534
Commercial and industrial other 547 334 5,023 5,904 1,007,363 1,013,267
Subtotal commercial and industrial 1,111 334 5,023 6,468 1,111,333 1,117,801
Commercial real estate
Construction 200 0 17,302 17,502 453,876 471,378
Agriculture 65 0 0 65 238,100 238,165
Commercial real estate other 1,132 0 3,609 4,741 2,967,529 2,972,270
Subtotal commercial real estate 1,397 0 20,911 22,308 3,659,505 3,681,813
Residential real estate
Home equity 598 0 2,683 3,281 226,646 229,927
Mortgages 1,059 965 7,804 9,828 1,349,274 1,359,102
Subtotal residential real estate 1,657 965 10,487 13,109 1,575,920 1,589,029
Consumer and other
Indirect 0 0 0 0 58 58
Consumer and other 205 205 150 560 83,049 83,609
Subtotal consumer and other 205 205 150 560 83,107 83,667
Leases 0 0 0 0 9,653 9,653
Total loans and leases $ 4,370 $ 1,504 $ 36,571 $ 42,445 $ 6,439,518 $ 6,481,963
Less: unearned income and deferred costs and fees 0 0 0 0 (4,020) (4,020)
Total loans and leases, net of unearned income and deferred costs and fees $ 4,370 $ 1,504 $ 36,571 $ 42,445 $ 6,435,498 $ 6,477,943
December 31, 2025
--- --- --- --- --- --- --- --- --- --- --- --- ---
(In thousands) 30-59 Days 60-89 Days 90 Days or More Total Past Due Current Loans Total Loans
Loans and Leases
Commercial and industrial
Agriculture $ 4 $ 0 $ 0 $ 4 $ 114,471 $ 114,475
Commercial and industrial other 1,818 1,543 5,136 8,497 977,676 986,173
Subtotal commercial and industrial 1,822 1,543 5,136 8,501 1,092,147 1,100,648
Commercial real estate
Construction 0 0 17,302 17,302 431,599 448,901
Agriculture 69 0 0 69 234,223 234,292
Commercial real estate other 474 775 4,507 5,756 2,973,086 2,978,842
Subtotal commercial real estate 543 775 21,809 23,127 3,638,908 3,662,035
Residential real estate
Home equity 1,286 107 2,040 3,433 224,221 227,654
Mortgages 0 2,331 8,225 10,556 1,352,976 1,363,532
Subtotal residential real estate 1,286 2,438 10,265 13,989 1,577,197 1,591,186
Consumer and other
Indirect 0 0 0 0 68 68
Consumer and other 295 104 191 590 85,809 86,399
Subtotal consumer and other 295 104 191 590 85,877 86,467
Leases 0 0 0 0 10,413 10,413
Total loans and leases $ 3,946 $ 4,860 $ 37,401 $ 46,207 $ 6,404,542 $ 6,450,749
Less: unearned income and deferred costs and fees 0 0 0 0 (4,504) (4,504)
Total loans and leases, net of unearned income and deferred costs and fees $ 3,946 $ 4,860 $ 37,401 $ 46,207 $ 6,400,038 $ 6,446,245

The following tables present 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. The below tables are an age analysis of nonaccrual loans segregated by class of loans, as of March 31, 2026 and December 31, 2025:

(In thousands) Nonaccrual Loans and Leases with no ACL Nonaccrual Loans and Leases Loans and Leases Past Due Over 89 Days and Accruing Nonaccrual Loans and Leases with no ACL Nonaccrual Loans and Leases Loans and Leases Past Due Over 89 Days and Accruing
March 31, 2026 December 31, 2025
Commercial and industrial
Commercial and industrial other $ 6,544 $ 11,355 $ 0 $ 4,565 $ 8,305 $ 0
Subtotal commercial and industrial 6,544 11,355 0 4,565 8,305 0
Commercial real estate
Construction 0 17,302 0 0 17,303 0
Agriculture 0 66 0 0 92 0
Commercial real estate other 927 5,113 0 1,463 5,469 0
Subtotal commercial real estate 927 22,481 0 1,463 22,864 0
Residential real estate
Home equity 232 3,256 0 232 2,624 0
Mortgages 1,203 14,122 1 1,570 13,931 1
Subtotal residential real estate 1,435 17,378 1 1,802 16,555 1
Consumer and other
Consumer and other 0 57 123 0 70 145
Subtotal consumer and other 0 57 123 0 70 145
Total loans and leases $ 8,906 $ 51,271 $ 124 $ 7,830 $ 47,794 $ 146

The Company recognized $0 of interest income on nonaccrual loans during the three months ended March 31, 2026.

  1. Allowance for Credit Losses

Management reviews the appropriateness of the allowance for credit losses ("allowance" or "ACL") on a regular basis. Management considers the accounting policy relating to the allowance to be a critical accounting policy, given the inherent uncertainty in evaluating the levels of the allowance required to cover credit losses in the portfolio and the material effect that assumptions could have on the Company’s results of operations. The Company has developed a methodology to measure the amount of estimated credit loss exposure inherent in the loan portfolio to assure that an appropriate allowance is maintained. The Company’s methodology is based upon guidance provided in SEC Staff Accounting Bulletin No. 119, Measurement of Credit Losses on Financial Instruments ("CECL"), and Financial Instruments - Credit Losses and ASC Topic 326, Financial Instruments - Credit Losses.

The Company uses a Discounted Cash Flow ("DCF") method to estimate expected credit losses for all loan segments excluding the leasing segment. For each of these loan segments, the Company generates cash flow projections at the instrument level wherein payment expectations are adjusted for estimated prepayment speed, curtailments, recovery lag, probability of default, and loss given default. The modeling of expected prepayment speeds, curtailment rates, and time to recovery are based on internal historical data.

The Company uses regression analysis of historical internal and peer data to determine suitable loss drivers to utilize when modeling lifetime probability of default and loss given default. This analysis also determines how expected probability of default and loss given default will react to forecasted levels of the loss drivers. For all loans utilizing the DCF method, management utilizes forecasts of national unemployment and a one year percentage change in national gross domestic product as loss drivers in the model.

For all DCF models, management 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. Management 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, and scenario weightings, are also considered by management when developing the forecast metrics.

Due to the size and characteristics of the leasing portfolio, the Company uses the remaining life method, using the historical loss rate of the commercial and industrial segment, to determine the allowance for credit losses.

The combination of adjustments for credit expectations and timing expectations produces an expected cash flow stream at the instrument level. Instrument effective yield is calculated, net of the impacts of prepayment assumptions, and the instrument expected cash flows are then discounted at that effective yield to produce a net present value of expected cash flows ("NPV"). An ACL is established for the difference between the NPV and amortized cost basis.

Since the methodology is based upon historical experience and trends, current conditions, and reasonable and supportable forecasts, as well as management’s judgment, factors may arise that result in different estimates. While management’s evaluation of the allowance as of March 31, 2026, considers the allowance to be appropriate, under different conditions or assumptions, the Company would need to increase or decrease the allowance. In addition, various federal and State regulatory agencies, as part of their examination process, review the Company's allowance and may require the Company to recognize additions to the allowance based on their judgments and information available to them at the time of their examinations.

Loan Commitments and Allowance for Credit Losses on Off-Balance Sheet Credit Exposures

Financial instruments include off-balance sheet credit instruments, such as commitments to make loans, and commercial letters of credit. The Company's exposure to credit loss in the event of nonperformance by the other party to the financial instrument for off-balance sheet loan commitments is represented by the contractual amount of those instruments. Such financial instruments are recorded when they are funded. The Company records an allowance for credit losses on off-balance sheet credit exposures, unless the commitments to extend credit are unconditionally cancellable, through a charge to credit loss expense for off-balance sheet credit exposures included in provision for credit loss expense in the Company's consolidated statements of income.

The following table details activity in the allowance for credit losses on loans and leases for the three months ended March 31, 2026 and 2025. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories.

(In thousands) Commercial<br>& Industrial Commercial<br>Real Estate Residential<br>Real Estate Consumer<br>and Other Finance<br>Leases Total
Three Months Ended March 31, 2026
Allowance for credit losses:
Beginning balance $ 10,234 $ 35,255 $ 10,893 $ 1,230 $ 59 $ 57,671
Charge-offs (336) 0 (250) (416) 0 (1,002)
Recoveries 17 6 63 141 0 227
Provision (credit) for credit loss expense 808 307 (140) 236 1 1,212
Ending Balance $ 10,723 $ 35,568 $ 10,566 $ 1,191 $ 60 $ 58,108
Three Months Ended March 31, 2025
Allowance for credit losses:
Beginning balance $ 7,684 $ 35,837 $ 11,345 $ 1,568 $ 62 $ 56,496
Charge-offs (185) 0 0 (779) 0 (964)
Recoveries 42 2 27 160 0 231
Provision (credit) for credit loss expense 1,077 3,469 170 548 (4) 5,260
Ending Balance $ 8,618 $ 39,308 $ 11,542 $ 1,497 $ 58 $ 61,023

The following table details activity in the liabilities for off-balance sheet credit exposures for the three months ended March 31, 2026 and 2025:

(In thousands) 2026 2025
Liabilities for off-balance sheet credit exposures at beginning of period $ 1,433 $ 1,463
Provision for credit loss expense related to off-balance sheet credit exposures 290 27
Liabilities for off-balance sheet credit exposures at end of period $ 1,723 $ 1,490

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

(In thousands) Real Estate Business Assets Other Total ACL Allocation
March 31, 2026
Commercial and Industrial $ 2,231 $ 4,986 $ 0 $ 7,217 $ 251
Commercial Real Estate 20,148 0 0 20,148 1,288
Total Loans and Leases $ 22,379 $ 4,986 $ 0 $ 27,365 $ 1,539
December 31, 2025
Commercial and Industrial $ 482 $ 4,565 $ 0 $ 5,047 $ 250
Commercial Real Estate 21,052 0 0 21,052 1,178
Total Loans and Leases $ 21,534 $ 4,565 $ 0 $ 26,099 $ 1,428

Loan Modifications to Borrowers Experiencing Financial Difficulty

When the Company modifies loans to borrowers experiencing financial difficulty, the modifications may include interest rate reductions, principal or interest forgiveness, forbearances, term extensions, and other actions intended to minimize economic loss and to avoid foreclosure or repossession of collateral.

The following tables show the amortized cost basis as of March 31, 2026 and December 31, 2025 of the loans modified to borrowers experiencing financial difficulty, disaggregated by class of financing receivable and type of concession granted:

(In thousands) Term Extension Interest Rate Reduction Payment Delay and Term Extension Term Extension and Interest Rate Reduction Payment Delay Total % of Total Class of Loans and Leases
March 31, 2026
Commercial and Industrial
Commercial and industrial other $ 78 $ 835 $ 0 $ 0 $ 0 $ 913 0.09 %
Subtotal commercial and industrial 78 835 0 0 0 913 0.08 %
Commercial Real Estate
Commercial real estate other 0 3,304 0 0 379 3,683 0.12 %
Subtotal commercial real estate 0 3,304 0 0 379 3,683 0.10 %
Residential
Home equity 0 0 0 49 0 49 0.02 %
Mortgages 0 0 0 297 940 1,237 0.09 %
Subtotal residential 0 0 0 346 940 1,286 0.08 %
Consumer
Consumer and other 23 0 0 0 0 23 0.03 %
Subtotal consumer 23 0 0 0 0 23 0.03 %
Total loans and leases $ 101 $ 4,139 $ 0 $ 346 $ 1,319 $ 5,905 0.09 %
(In thousands) Term Extension Interest Rate Reduction Payment Delay and Term Extension Term Extension and Interest Rate Reduction Payment Delay Total % of Total Class of Loans and Leases
--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
December 31, 2025
Commercial and Industrial
Commercial and industrial other $ 101 $ 410 $ 0 $ 262 $ 0 $ 773 0.08 %
Subtotal commercial and industrial 101 410 0 262 0 773 0.07 %
Commercial Real Estate
Commercial real estate other 0 2,856 0 0 382 3,238 0.11 %
Subtotal commercial real estate 0 2,856 0 0 382 3,238 0.09 %
Residential
Home equity 0 0 0 50 0 50 0.02 %
Mortgages 0 0 0 109 953 1,062 0.08 %
Subtotal residential 0 0 0 159 953 1,112 0.07 %
Consumer
Consumer and other 23 0 0 0 0 23 0.03 %
Subtotal consumer 23 0 0 0 0 23 0.03 %
Total loans and leases $ 124 $ 3,266 $ 0 $ 421 $ 1,335 $ 5,146 0.08 %

There were no loan modifications made to borrowers experiencing financial difficulty that had defaulted as of March 31, 2026 and December 31, 2025.

The following tables show the aging analysis of loan modifications made to borrowers experiencing financial difficulty as of March 31, 2026 and December 31, 2025:

Payment Status (Amortized Cost Basis)
(In thousands) Current 30-59 Days Past Due 60-89 Days Past Due 90+ Days Past Due Non-Accrual Total
March 31, 2026
Commercial and Industrial
Commercial and industrial other $ 436 $ 0 $ 0 $ 0 $ 477 $ 913
Subtotal commercial and industrial 436 0 0 0 477 913
Commercial Real Estate
Commercial real estate other 3,199 0 0 0 484 3,683
Subtotal commercial real estate 3,199 0 0 0 484 3,683
Residential Real Estate
Home equity 49 0 0 0 0 49
Mortgages 258 0 0 0 979 1,237
Subtotal residential real estate 307 0 0 0 979 1,286
Consumer and Other
Consumer and other 23 0 0 0 0 23
Subtotal consumer and other 23 0 0 0 0 23
Total $ 3,965 $ 0 $ 0 $ 0 $ 1,940 $ 5,905
Payment Status (Amortized Cost Basis)
--- --- --- --- --- --- --- --- --- --- --- --- ---
(In thousands) Current 30-59 Days Past Due 60-89 Days Past Due 90+ Days Past Due Non-Accrual Total
December 31, 2025
Commercial and Industrial
Commercial and industrial other $ 474 $ 262 $ 0 $ 0 $ 37 $ 773
Subtotal commercial and industrial 474 262 0 0 37 773
Commercial Real Estate
Commercial real estate other 3,238 0 0 0 0 3,238
Subtotal commercial real estate 3,238 0 0 0 0 3,238
Residential Real Estate
Home equity 50 0 0 0 0 50
Mortgages 260 0 0 0 802 1,062
Subtotal residential real estate 310 0 0 0 802 1,112
Consumer and Other
Consumer and other 23 0 0 0 0 23
Subtotal consumer and other 23 0 0 0 0 23
Total $ 4,045 $ 262 $ 0 $ 0 $ 839 $ 5,146

The following tables present credit quality indicators by total loans on an amortized cost basis by origination year as of March 31, 2026 and December 31, 2025:

March 31, 2026
(In thousands) 2026 2025 2024 2023 2022 Prior Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Total Loans
Commercial and Industrial - Other:
Pass $ 63,659 $ 164,262 $ 113,700 $ 72,835 $ 76,150 $ 148,294 $ 331,280 $ 5,901 $ 976,081
Special Mention 0 112 1,388 71 0 2,730 22,048 0 26,349
Substandard 0 61 674 1,419 1,295 930 6,458 0 10,837
Total Commercial and Industrial - Other $ 63,659 $ 164,435 $ 115,762 $ 74,325 $ 77,445 $ 151,954 $ 359,786 $ 5,901 $ 1,013,267
Current-period gross writeoffs $ 0 $ 223 $ 113 $ 250 $ 0 $ 0 $ 0 $ 0 $ 586
Commercial and Industrial - Agriculture:
Pass $ 4,402 $ 9,799 $ 8,107 $ 22,930 $ 6,900 $ 4,585 $ 47,679 $ 0 $ 104,402
Special Mention 0 23 0 0 3 19 66 0 111
Substandard 0 0 0 0 0 21 0 0 21
Total Commercial and Industrial - Agriculture $ 4,402 $ 9,822 $ 8,107 $ 22,930 $ 6,903 $ 4,625 $ 47,745 $ 0 $ 104,534
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Commercial Real Estate
Pass $ 65,266 $ 420,999 $ 327,844 $ 245,834 $ 295,832 $ 1,520,790 $ 18,783 $ 11,815 $ 2,907,163
Special Mention 0 6,500 303 920 1,459 29,853 0 0 39,035
Substandard 0 0 399 927 2,119 21,890 737 0 26,072
Total Commercial Real Estate $ 65,266 $ 427,499 $ 328,546 $ 247,681 $ 299,410 $ 1,572,533 $ 19,520 $ 11,815 $ 2,972,270
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Commercial Real Estate - Agriculture:
Pass $ 7,375 $ 27,881 $ 24,249 $ 11,325 $ 40,488 $ 118,948 $ 5,599 $ 2,043 $ 237,908
Special Mention 0 0 0 0 0 157 0 0 157
Substandard 0 0 0 0 0 100 0 0 100
Total Commercial Real Estate - Agriculture $ 7,375 $ 27,881 $ 24,249 $ 11,325 $ 40,488 $ 119,205 $ 5,599 $ 2,043 $ 238,165
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Commercial Real Estate - Construction
Pass $ 0 $ 0 $ 9,000 $ 37,160 $ 18,226 $ 15,930 $ 366,998 $ 6,311 $ 453,625
Special Mention 0 0 0 0 0 0 452 0 452
Substandard 0 0 0 0 0 0 17,301 0 17,301
Total Commercial Real Estate - Construction $ 0 $ 0 $ 9,000 $ 37,160 $ 18,226 $ 15,930 $ 384,751 $ 6,311 $ 471,378
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
(In thousands) 2026 2025 2024 2023 2022 Prior Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Total Loans
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Residential - Home Equity
Performing $ 396 $ 1,537 $ 744 $ 1,366 $ 1,232 $ 17,735 $ 202,873 $ 788 $ 226,671
Nonperforming 0 0 0 0 0 1,515 1,741 0 3,256
Total Residential - Home Equity $ 396 $ 1,537 $ 744 $ 1,366 $ 1,232 $ 19,250 $ 204,614 $ 788 $ 229,927
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Residential - Mortgages
Performing $ 26,020 $ 110,382 $ 100,262 $ 117,613 $ 158,819 $ 831,884 $ 0 $ 0 $ 1,344,980
Nonperforming 0 103 474 865 832 11,848 0 0 14,122
Total Residential - Mortgages $ 26,020 $ 110,485 $ 100,736 $ 118,478 $ 159,651 $ 843,732 $ 0 $ 0 $ 1,359,102
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Consumer - Direct
Performing $ 15,963 $ 20,715 $ 9,858 $ 10,416 $ 6,872 $ 17,629 $ 2,099 $ 0 $ 83,552
Nonperforming 0 5 9 14 14 14 1 0 57
Total Consumer - Direct $ 15,963 $ 20,720 $ 9,867 $ 10,430 $ 6,886 $ 17,643 $ 2,100 $ 0 $ 83,609
Current-period gross writeoffs $ 355 $ 15 $ 0 $ 5 $ 5 $ 36 $ 0 $ 0 $ 416
Consumer - Indirect
Performing $ 0 $ 0 $ 0 $ 0 $ 0 $ 58 $ 0 $ 0 $ 58
Nonperforming 0 0 0 0 0 0 0 0 0
Total Consumer - Indirect $ 0 $ 0 $ 0 $ 0 $ 0 $ 58 $ 0 $ 0 $ 58
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
December 31, 2025
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(In thousands) 2025 2024 2023 2022 2021 Prior Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Total Loans
Commercial and Industrial - Other:
Pass $ 178,999 $ 111,528 $ 81,883 $ 73,977 $ 37,104 $ 126,706 $ 316,314 $ 8,606 $ 935,117
Special Mention 9,871 9,447 90 1,154 178 1,468 21,037 0 43,245
Substandard 0 423 1,433 0 390 192 5,032 341 7,811
Total Commercial and Industrial - Other $ 188,870 $ 121,398 $ 83,406 $ 75,131 $ 37,672 $ 128,366 $ 342,383 $ 8,947 $ 986,173
Current-period gross writeoffs $ 526 $ 597 $ 85 $ 66 $ 254 $ 13 $ 0 $ 0 $ 1,541
Commercial and Industrial - Agriculture:
Pass $ 11,890 $ 9,337 $ 24,659 $ 7,539 $ 1,418 $ 3,852 $ 55,263 $ 470 $ 114,428
Special Mention 0 0 0 0 22 25 0 0 47
Substandard 0 0 0 0 0 0 0 0 0
Total Commercial and Industrial - Agriculture $ 11,890 $ 9,337 $ 24,659 $ 7,539 $ 1,440 $ 3,877 $ 55,263 $ 470 $ 114,475
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Commercial Real Estate
Pass $ 409,529 $ 320,178 $ 256,566 $ 310,051 $ 374,436 $ 1,204,064 $ 19,291 $ 19,216 $ 2,913,331
Special Mention 6,500 305 927 1,961 1,362 45,932 0 0 56,987
Substandard 0 399 927 1,149 1,461 3,804 784 0 8,524
Total Commercial Real Estate $ 416,029 $ 320,882 $ 258,420 $ 313,161 $ 377,259 $ 1,253,800 $ 20,075 $ 19,216 $ 2,978,842
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 2,000 $ 5,310 $ 0 $ 0 $ 7,310
Commercial Real Estate - Agriculture:
Pass $ 26,485 $ 23,114 $ 11,133 $ 41,082 $ 20,087 $ 103,609 $ 4,488 $ 4,026 $ 234,024
Special Mention 0 0 0 0 0 141 0 0 141
Substandard 0 0 0 0 0 127 0 0 127
Total Commercial Real Estate - Agriculture $ 26,485 $ 23,114 $ 11,133 $ 41,082 $ 20,087 $ 103,877 $ 4,488 $ 4,026 $ 234,292
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Commercial Real Estate - Construction
Pass $ 0 $ 13,222 $ 30,274 $ 1,542 $ 15,688 $ 349 $ 344,568 $ 25,659 $ 431,302
Special Mention 0 0 0 0 0 0 297 0 297
Substandard 0 0 0 0 0 0 17,302 0 17,302
Total Commercial Real Estate - Construction $ 0 $ 13,222 $ 30,274 $ 1,542 $ 15,688 $ 349 $ 362,167 $ 25,659 $ 448,901
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
(In thousands) 2025 2024 2023 2022 2021 Prior Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Total Loans
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Residential - Home Equity
Performing $ 1,613 $ 767 $ 1,448 $ 1,309 $ 795 $ 17,309 $ 200,118 $ 1,671 $ 225,030
Nonperforming 0 0 0 0 0 1,382 1,242 0 2,624
Total Residential - Home Equity $ 1,613 $ 767 $ 1,448 $ 1,309 $ 795 $ 18,691 $ 201,360 $ 1,671 $ 227,654
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Residential - Mortgages
Performing $ 113,023 $ 104,677 $ 120,785 $ 160,682 $ 220,793 $ 629,641 $ 0 $ 0 $ 1,349,601
Nonperforming 103 294 878 982 1,037 10,637 0 0 13,931
Total Residential - Mortgages $ 113,126 $ 104,971 $ 121,663 $ 161,664 $ 221,830 $ 640,278 $ 0 $ 0 $ 1,363,532
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Consumer - Direct
Performing $ 34,987 $ 11,109 $ 11,207 $ 7,430 $ 6,887 $ 12,427 $ 2,282 $ 0 $ 86,329
Nonperforming 0 0 2 21 0 40 7 0 70
Total Consumer - Direct $ 34,987 $ 11,109 $ 11,209 $ 7,451 $ 6,887 $ 12,467 $ 2,289 $ 0 $ 86,399
Current-period gross writeoffs $ 2,220 $ 15 $ 17 $ 17 $ 20 $ 55 $ 0 $ 0 $ 2,344
Consumer - Indirect
Performing $ 0 $ 0 $ 0 $ 0 $ 17 $ 51 $ 0 $ 0 $ 68
Nonperforming 0 0 0 0 0 0 0 0 0
Total Consumer - Indirect $ 0 $ 0 $ 0 $ 0 $ 17 $ 51 $ 0 $ 0 $ 68
Current-period gross writeoffs $ 0 $ 0 $ 0 $ 0 $ 0 $ 15 $ 0 $ 0 $ 15
  1. Earnings Per Share

Earnings per share in the table below, for the three month periods ended March 31, 2026 and 2025 are calculated under the two-class method as required by ASC Topic 260, Earnings Per Share (ASC 260). ASC 260 provides that unvested share-based payment awards that contain nonforfeitable rights to dividends are participating securities and shall be included in the computation of earnings per share pursuant to the two-class method. Prior to 2019, the Company issued restricted stock awards that contained such rights and are therefore considered participating securities. Since 2019, the Company has issued restricted stock awards that do not have nonforfeitable rights to dividends and are therefore not considered participating securities. Basic earnings per common share are calculated by dividing net income allocable to common stock by the weighted average number of common shares, excluding participating securities, during the period. Diluted earnings per common share include the dilutive effect of participating securities.

Three Months Ended
(In thousands, except share and per share data) 03/31/2026 03/31/2025
Basic
Net income available to common shareholders $ 26,074 $ 19,679
Less: income attributable to unvested stock-based compensation awards 0 0
Net earnings allocated to common shareholders 26,074 19,679
Weighted average shares outstanding, including unvested stock-based compensation awards 14,416,228 14,434,637
Less: average unvested stock-based compensation awards (165,259) (188,497)
Weighted average shares outstanding - Basic 14,250,969 14,246,140
Diluted
Net earnings allocated to common shareholders 26,074 19,679
Weighted average shares outstanding - Basic 14,250,969 14,246,140
Plus: incremental shares from assumed conversion of stock-based compensation awards 96,545 73,300
Weighted average shares outstanding - Diluted 14,347,514 14,319,440
Basic EPS $ 1.83 $ 1.38
Diluted EPS $ 1.82 $ 1.37

Stock-based compensation awards representing 8,209 and 13,488 of common shares during the three months ended March 31, 2026 and 2025, respectively, were not included in the computations of diluted earnings per common share because the effect on those periods would have been anti-dilutive.

  1. Other Comprehensive Income (Loss)

The following table presents reclassifications out of the accumulated other comprehensive income (loss) for the three month periods ended March 31, 2026 and 2025:

(In thousands) Before-Tax<br>Amount Tax (Expense)<br>Benefit Net of Tax
March 31, 2026
Available-for-sale debt securities:
Change in net unrealized (loss) gain during the period $ (9,549) $ 2,387 $ (7,162)
Net unrealized gains (9,549) 2,387 (7,162)
Employee benefit plans:
Amortization of net retirement plan actuarial gain (loss) 109 (27) 82
Amortization of net retirement plan prior service cost 49 (13) 36
Employee benefit plans 158 (40) 118
Other comprehensive loss $ (9,391) $ 2,347 $ (7,044)
March 31, 2025
Available-for-sale debt securities:
Change in net unrealized (loss) gain during the period $ 21,489 $ (5,372) $ 16,117
Net unrealized losses 21,489 (5,372) 16,117
Employee benefit plans:
Amortization of net retirement plan actuarial gain (loss) 171 (43) 128
Amortization of net retirement plan prior service cost 49 (12) 37
Employee benefit plans 220 (55) 165
Other comprehensive income $ 21,709 $ (5,427) $ 16,282

The following table presents the activity in our accumulated other comprehensive income (loss) for the periods indicated:

(In thousands) Available-for-<br>Sale Debt Securities Employee<br>Benefit Plans Accumulated<br>Other<br>Comprehensive<br>(Loss) Income
Balance at January 1, 2026 $ (6,984) $ (12,070) $ (19,054)
Other comprehensive income before reclassifications (7,162) 0 (7,162)
Amounts reclassified from accumulated other comprehensive (loss) income 0 118 118
Net current-period other comprehensive income (7,162) 118 (7,044)
Balance at March 31, 2026 $ (14,146) $ (11,952) $ (26,098)
Balance at January 1, 2025 $ (101,694) $ (16,798) $ (118,492)
Other comprehensive loss before reclassifications 16,117 0 16,117
Amounts reclassified from accumulated other comprehensive (loss) income 0 165 165
Net current-period other comprehensive income (loss) 16,117 165 16,282
Balance at March 31, 2025 $ (85,577) $ (16,633) $ (102,210)

The following table presents the amounts reclassified out of each component of accumulated other comprehensive (loss) income for the three months ended March 31, 2026 and 2025:

Details about Accumulated other Comprehensive Income (Loss) Components (In thousands) Amount Reclassified from Accumulated Other Comprehensive (Loss) Income1 Affected Line Item in the Statement Where Net Income is Presented
03/31/2026 03/31/2025
Available-for-sale debt securities:
Unrealized gains and losses on available-for-sale debt securities $ 0 $ 0 Net gain (loss) on securities transactions
0 0 Income tax expense
0 0 Net of tax
Employee benefit plans:
Amortization of the following
Net retirement plan actuarial loss (109) (171) Other operating expense
Net retirement plan prior service cost (49) (49) Other operating expense
(158) (220) Total before tax
40 55 Income tax expense
$ (118) $ (165) Net of tax

1 Amounts in parentheses indicate debits in income statement.

  1. Financial Guarantees

The Company currently does not issue any guarantees that would require liability recognition or disclosure, other than standby letters of credit. The Company extends standby letters of credit to its customers in the normal course of business. The standby letters of credit are generally short-term. As of March 31, 2026, the Company’s maximum potential obligation under standby letters of credit was $36.8 million compared to $36.5 million at December 31, 2025. Management uses the same credit policies to extend standby letters of credit that it uses for on-balance sheet lending decisions and may require collateral to support standby letters of credit based upon its evaluation of the counterparty. Management does not anticipate any significant losses as a result of these transactions, and has determined that the fair value of standby letters of credit is not significant.

  1. Segment and Related Information

The Company manages its operations through two reportable business segments in accordance with the standards set forth in FASB ASC 280, "Segment Reporting": (i) banking and (ii) wealth management. The Company’s wealth management services, other than trust services, are managed separately from the banking segment.

On October 31, 2025, the Company sold all of the issued and outstanding shares of capital stock of its insurance subsidiary, TIA, to Gallagher. For the first 10 months of 2025, the Company had three operating segments: (i) banking, (ii) insurance services, and (iii) wealth management.

Banking

Tompkins Community Bank has twelve banking offices located in Ithaca, NY and surrounding communities; fourteen banking offices located in the Genesee Valley region of New York State, which includes Monroe County; twelve banking offices located in the counties north of New York City; and sixteen banking offices operating in southeastern Pennsylvania.

Wealth Management

The wealth management segment is generally organized under the Tompkins Financial Advisors brand. Tompkins Financial Advisors offers a comprehensive suite of financial services to customers, including trust and estate services, investment management and financial and insurance planning for individuals, corporate executives, small business owners and high net worth individuals. Tompkins Financial Advisors has offices in each of the Company’s regional markets.

Chief Operating Decision Maker

Our Chief Executive Officer ("CEO") is our chief operating decision maker. In order to allocate costs, capital and resources to each operating segment, we (i) identify the cost or opportunity value of funds within each business segment, (ii) measure the profitability of a particular business segment by relating appropriate costs to revenues, (iii) evaluate each business segment in a manner consistent with its economic impact on consolidated earnings, and (iv) enhance asset and liability pricing decisions. Our CEO reviews actual net income versus budgeted net income on a monthly basis to assess segment performance and to make decisions about allocating capital and personnel among the segments.

Segment Reporting

Summarized financial information concerning the Company’s reportable segments and the reconciliation to the Company’s consolidated results is shown in the following tables. Investment in subsidiaries is netted out of the presentations below. The “Intercompany” column identifies the intercompany activities of revenues, expenses and other assets between the banking, insurance and wealth management services segments. The Company accounts for intercompany fees and services at an estimated fair value according to regulatory requirements for the services provided. Intercompany items relate primarily to the use of human resources, information systems, accounting and marketing services provided by the bank and the holding company. All other accounting policies are the same as those described in the summary of significant accounting policies in the Company's Annual Report on Form 10-K for the year ended December 31, 2025.

Three months ended March 31, 2026
(In thousands) Banking Wealth Management Intercompany Consolidated
Interest income $ 102,669 $ 0 $ 0 $ 102,669
Interest expense 30,808 0 0 30,808
Net interest income 71,861 0 0 71,861
Provision for credit loss expense 1,502 0 0 1,502
Noninterest income 6,468 5,366 0 11,834
Noninterest expense 43,578 4,148 0 47,726
Income before income tax expense 33,249 1,218 0 34,467
Income tax expense 8,089 304 0 8,393
Net Income $ 25,160 $ 914 $ 0 $ 26,074
Depreciation and amortization $ 2,261 $ 46 $ 0 $ 2,307
Assets 8,666,640 29,121 0 8,695,761
Goodwill 64,525 8,211 0 72,736
Other intangibles, net 1,833 0 0 1,833
Net loans and leases 6,419,835 0 0 6,419,835
Deposits 7,054,239 0 (67) 7,054,172
Total Equity 920,303 26,438 0 946,741 Three months ended March 31, 2025
--- --- --- --- --- --- --- --- --- --- ---
(In thousands) Banking Insurance Wealth<br>Management Intercompany Consolidated
Interest income $ 89,462 $ 1 $ 0 $ (1) $ 89,462
Interest expense 32,801 0 0 (1) 32,800
Net interest income 56,661 1 0 0 56,662
Provision for credit loss expense 5,287 0 0 0 5,287
Noninterest income 8,645 11,703 5,213 (529) 25,032
Noninterest expense 39,693 7,325 4,118 (529) 50,607
Income before income tax expense 20,326 4,379 1,095 0 25,800
Income tax expense 4,642 1,205 274 0 6,121
Net Income $ 15,684 $ 3,174 $ 821 $ 0 $ 19,679
Depreciation and amortization $ 2,105 $ 46 $ 44 $ 0 $ 2,195
Assets 8,141,375 44,496 29,304 (15,522) 8,199,653
Goodwill 64,524 19,867 8,211 0 92,602
Other intangibles, net 1,222 935 19 0 2,176
Net loans and leases 6,005,622 0 0 0 6,005,622
Deposits 6,768,704 0 0 (15,202) 6,753,502
Total Equity 678,242 36,669 26,466 0 741,377
  1. Fair Value Measurements

FASB ASC Topic 820, Fair Value Measurements and Disclosures, defines fair value, establishes a framework for measuring fair value in accordance with GAAP and expands disclosures about fair value measurements. FASB ASC Topic 820 also establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Transfers between levels, when determined to be appropriate, are recognized at the end of each reporting period.

The three levels of the fair value hierarchy under FASB ASC Topic 820 are:

Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2 - Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;

Level 3 – Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).

The following tables summarize financial assets and financial liabilities measured at fair value on a recurring basis as of March 31, 2026 and December 31, 2025, segregated by the level of valuation inputs within the fair value hierarchy used to measure fair value:

Recurring Fair Value Measurements
(In thousands) Total (Level 1) (Level 2) (Level 3)
March 31, 2026
Assets
Available-for-sale debt securities
U.S. Treasuries $ 43,742 $ 0 $ 43,742 $ 0
Obligations of U.S. Government sponsored entities 340,509 0 340,509 0
Obligations of U.S. states and political subdivisions 74,641 0 74,641 0
Mortgage-backed securities – residential, issued by:
U.S. Government agencies 306,455 0 306,455 0
U.S. Government sponsored entities 621,112 0 621,112 0
U.S. corporate debt securities 2,451 0 2,451 0
Total Available-for-sale debt securities $ 1,388,910 $ 0 $ 1,388,910 $ 0
Equity securities, at fair value 795 0 0 795
Derivatives designated as hedging instruments 23 0 23 0
Derivatives not designated as hedging instruments 3,725 0 3,725 0
Liabilities
Derivatives not designated as hedging instruments $ 4,095 $ 0 $ 4,095 $ 0
December 31, 2025
Assets
Available-for-sale debt securities
U.S. Treasuries $ 53,780 $ 0 $ 53,780 $ 0
Obligations of U.S. Government sponsored entities 348,403 0 348,403 0
Obligations of U.S. states and political subdivisions 76,310 0 76,310 0
Mortgage-backed securities – residential, issued by:
U.S. Government agencies 313,496 0 313,496 0
U.S. Government sponsored entities 587,632 0 587,632 0
U.S. corporate debt securities 2,447 0 2,447 0
Total Available-for-sale debt securities $ 1,382,068 $ 0 $ 1,382,068 $ 0
Equity securities, at fair value 800 0 0 800
Derivatives designated as hedging instruments 33 0 33 0
Derivatives not designated as hedging instruments 5,032 0 5,032 0
Liabilities
Derivatives not designated as hedging instruments $ 5,389 $ 0 $ 5,389 $ 0

Securities: Fair values for U.S. Treasury securities are based on quoted market prices. Fair values for obligations of U.S. government sponsored entities, mortgage-backed securities-residential, obligations of U.S. states and political subdivisions, and U.S. corporate debt securities are based on quoted market prices, where available, as provided by third-party pricing vendors. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments in active markets and/or based upon a matrix pricing methodology, which uses comprehensive interest rate tables to determine market price, movement and yield relationships. These securities are reviewed periodically to determine if there are any events or changes in circumstances that would adversely affect their value.

The change in the fair value of equity securities valued using significant unobservable inputs (level 3), between December 31, 2025 and March 31, 2026, was immaterial.

There were no transfers between Levels 1, 2 and 3 for the three months ended March 31, 2026.

The Company determines fair value for its available-for-sale debt securities using an independent bond pricing service for identical assets or very similar securities. The Company determines fair value for its equity securities based on the underlying equity fund’s pricing and valuation procedures which consider recent sales price, market quotations from a pricing service, or market quotes from an independent broker-dealer. The Company has reviewed the pricing sources, including methodologies used, and finds them to be fairly stated.

Derivatives: The Company has contracted with a third-party vendor to provide periodic valuations for its interest rate derivatives to determine the fair value of its interest rate contracts. The vendor utilizes standard valuation methodologies applicable to interest rate derivatives such as discounted cash flow analysis. Such valuations are based upon readily observable market data and are therefore considered Level 2 valuations by the Company.

Certain assets are measured at fair value on a nonrecurring basis. For the Company, these include loans held for sale, collateral-dependent individually evaluated loans, and other real estate owned ("OREO"). As of March 31, 2026 and 2025, certain collateral-dependent evaluated loans were remeasured and reported at fair value through a specific valuation allowance and/or partial charge-offs for credit losses based upon the fair value of the underlying collateral. Collateral values are estimated using Level 3 inputs. Upon initial recognition, fair value write-downs are taken through a charge-off to the allowance for credit losses. Subsequent fair value write-downs on other real estate owned are reported in other noninterest expense.

The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments at March 31, 2026 and 2025. The carrying amounts shown in the table are included in the Consolidated Statements of Condition under the indicated captions:

(In thousands) Fair value measurements at reporting<br>date using: Gain (losses)<br>from fair<br>value changes
Assets: (Level 1) (Level 2) (Level 3)
Three months ended March 31, 2026
Individually evaluated loans $ 18,443 $ 0 $ 0 $ 18,443 $ (250)
Other real estate owned 37 0 0 37 0
Three months ended March 31, 2025
Individually evaluated loans $ 36,274 $ 0 $ 0 $ 36,274 $ 80
Other real estate owned 0 0 0 0 1,898

The fair value estimates, methods and assumptions set forth below for the Company's financial instruments, including those financial instruments carried at cost, are made solely to comply with disclosures required by GAAP and should be read in conjunction with the financial statements and notes included herein.

For loans where the Company has determined that foreclosure of the collateral is probable, or where the borrower is experiencing financial difficulty and the Company expects repayment of the loan to be provided substantially through the operation or sale of the collateral, the ACL is measured based on the difference between the fair value of the collateral and the amortized cost basis of the loan as of the measurement date. 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.

Estimated Fair Value of Financial Instruments
(In thousands) Carrying<br>Amount Fair Value (Level 1) (Level 2) (Level 3)
March 31, 2026
Financial Assets:
Cash and cash equivalents $ 171,449 $ 171,449 $ 171,449 $ 0 $ 0
Securities - held-to-maturity 312,545 282,589 0 282,589 0
FHLB stock and other stock 27,189 27,189 0 27,189 0
Accrued interest receivable 32,058 32,058 0 32,058 0
Loans/leases, net1 6,419,889 6,123,061 0 0 6,123,061
Financial Liabilities:
Time deposits $ 1,292,391 $ 1,288,852 $ 0 $ 1,288,852 $ 0
Other deposits 5,761,781 5,761,781 0 5,761,781 0
Fed funds purchased and securities sold
under agreements to repurchase 118,133 118,133 0 118,133 0
Other borrowings 449,446 450,017 0 450,017 0
Accrued interest payable 4,343 4,343 0 4,343 0
December 31, 2025
Financial Assets:
Cash and cash equivalents $ 132,817 $ 132,817 $ 132,817 $ 0 $ 0
Securities - held-to-maturity 312,528 283,860 0 283,860 0
FHLB stock and other stock 32,307 32,307 0 32,307 0
Accrued interest receivable 30,697 30,697 0 30,697 0
Loans/leases, net1 6,432,014 6,129,089 0 0 6,129,089
Financial Liabilities:
Time deposits $ 1,298,393 $ 1,296,714 $ 0 $ 1,296,714 $ 0
Other deposits 5,639,369 5,639,369 0 5,639,369 0
Fed funds purchased and securities sold
under agreements to repurchase 95,569 95,569 0 95,569 0
Other borrowings 564,446 565,568 0 565,568 0
Accrued interest payable 4,920 4,920 0 4,920 0

1 Lease receivables, although excluded from the scope of ASC Topic 825, are included in the estimated fair value amounts at their carrying value.

The following methods and assumptions were used in estimating fair value disclosures for financial instruments.

Cash and Cash Equivalents: The carrying amounts reported in the Consolidated Statements of Condition for cash, noninterest-bearing deposits, money market funds, and Federal funds sold approximate the fair value of those assets.

Securities - Held-to-Maturity: Fair values for U.S. Treasury securities are based on quoted market prices. Fair values for obligations of U.S. government sponsored entities and mortgage-backed securities-residential are based on quoted market prices, where available, as provided by third-party pricing vendors. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments in active markets and/or based upon a matrix pricing methodology,

which uses comprehensive interest rate tables to determine market price, movement and yield relationships. These securities are reviewed periodically to determine if there are any events or changes in circumstances that would adversely affect their value.

FHLB Stock and Other Stock: The carrying amount of FHLB stock approximates fair value. If the stock is redeemed, the Company will receive an amount equal to the par value of the stock. For other stock reported above, carrying value is cost.

Loans and Leases: Fair value for loans is calculated using an exit price notion. The Company's valuation methodology takes into account factors such as estimated cash flows, including contractual cash flow and assumptions for prepayments; liquidity risk; and credit risk. The fair values of residential loans were estimated using discounted cash flow analyses, based upon available market benchmarks for rates and prepayment assumptions. The fair values of commercial and consumer loans were estimated using discounted cash flow analyses, based upon interest rates currently offered for loans and leases with similar terms and credit quality. The fair values of loans held for sale were determined based upon contractual prices for loans with similar characteristics.

Accrued Interest Receivable and Accrued Interest Payable: The carrying amount of these short term instruments approximates fair value.

Deposits: The fair values disclosed for noninterest bearing accounts and accounts with no stated maturities are equal to the amount payable on demand at the reporting date. The fair value of time deposits is based upon discounted cash flow analyses using rates offered for FHLB advances, which is the Company’s primary alternative source of funds.

Fed Funds Purchased and Securities Sold Under Agreements to Repurchase: The carrying amount of these instruments approximates fair value because the instruments have short-term maturities.

Other borrowings: The fair value of other borrowings is based upon discounted cash flow analyses using current rates offered for FHLB advances, with similar terms.

  1. Derivatives and Hedging Activities

Risk Management Objective of Using Derivatives

The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and liabilities and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company also enters into interest rate derivatives to accommodate the business requirements of certain qualifying customers. All derivatives are recognized as other assets or other liabilities on the Company's Consolidated Statements of Condition at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative and resulting designation.

Derivatives Designated as Hedging Instruments

Fair Value Hedges of Interest Rate Risk

The Company is exposed to changes in the fair value of certain of its fixed-rate assets due to changes in benchmark interest rates. The Company uses interest rate swaps to manage its exposure to changes in fair value on these instruments attributable to changes in the designated benchmark interest rate. Interest rate swaps designated as fair value hedges involve the payment of fixed-rate amounts to a counterparty in exchange for the Company receiving variable-rate payments over the life of the agreements without the exchange of the underlying notional amount. As of March 31, 2026, the Company had interest rate swaps with a total notional amount of $50.0 million hedging fixed-rate residential mortgage loans.

For derivatives designated and that qualify as fair value hedges, the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in interest income.

As of March 31, 2026 and December 31, 2025, the following amounts were recorded on the consolidated statements of condition related to cumulative basis adjustment for fair value hedges.

Line Item in the Statement of Financial Position in Which the Hedged Item is Included Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities) Carrying Amount of the Hedged Assets/(Liabilities) Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities)
03/31/2026 12/31/2025 12/31/2025
Fixed Rate Loans1 $(30) $49,962 $(38)
Total $(30) $49,962 $(38)
1 These amounts include the amortized cost basis of closed portfolios of fixed rate loans used to designate hedging relationships in which the hedged item is the stated amount of assets in the closed portfolio anticipated to be outstanding for the designated hedged period. At March 31, 2026 and December 31, 2025, the amortized cost basis of the closed portfolios used in these hedging relationships was 648.5 million and 658.5 million respectively; the cumulative basis adjustments associated with these hedging relationships was 30,000 and 38,000, respectively; and the amounts of the designated hedged items were 50.0 million and 100.0 million respectively.

All values are in US Dollars.

Derivatives Not Designated as Hedging Instruments

The Company enters into interest rate swaps to help commercial loan borrowers manage their interest rate risk. These interest rate swap contracts allow borrowers to convert variable-rate loan payments to fixed-rate loan payments. When the Company enters into an interest rate derivative contract with a commercial loan borrower, it simultaneously enters into a “mirror” interest rate contract with a third-party. For interest rate swaps, the third-party exchanges the client’s fixed-rate loan payments for variable-rate loan payments. The Company's credit policies with respect to interest rate contracts with commercial borrowers are similar to those used for loans. The Company retains the risk that is associated with the potential failure of counterparties and the risk inherent in originating loans. The interest rate contracts with counterparties are generally subject to bilateral collateralization terms. These derivatives are not designated as hedges and therefore, changes in fair value are recognized in earnings.

The Company has entered into risk participation agreements with other banks in commercial loan arrangements. Participating banks guarantee the performance on borrower-related interest rate swap contracts. These derivatives are not designated as hedges and therefore, changes in fair value are recognized in earnings.

Under a risk participation-out agreement, a derivative asset, the Company participates out a portion of the credit risk associated with the interest rate swap position executed with the commercial borrower for a fee paid to the participating bank. Under a risk participation-in agreement, a derivative liability, the Company assumes, or participates in, a portion of the credit risk associated with the interest rate swap position with the commercial borrower for a fee received from the other bank.

Tabular Disclosure of Fair Values of Derivative Instruments on the Consolidated Statements of Condition

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the consolidated statements of condition as of March 31, 2026 and December 31, 2025.

(In thousands) Notional Amount Fair Value Notional Amount Fair Value
March 31, 2026 December 31, 2025
Derivative Assets
Derivatives designated as hedging instruments
Interest Rate Products $ 50,000 $ 23 $ 50,000 $ 33
Total derivatives designated as hedging instruments $ 23 $ 33
Derivatives not designated as hedging instruments
Interest Rate Products $ 251,804 $ 3,725 $ 249,273 $ 5,032
Total derivatives not designated as hedging instruments $ 3,725 $ 5,032
Derivative Liabilities
Derivatives not designated as hedging instruments
Interest Rate Products $ 251,804 $ 4,013 $ 249,273 $ 5,312
Risk Participation Agreement 57,717 82 64,282 77
Total derivatives not designated as hedging instruments $ 4,095 $ 5,389

Tabular Disclosure of the Effect of Fair Value and Cash Flow Hedge Accounting on the Consolidated Statements of Income

The table below presents the effect of the Company’s derivative financial instruments on the consolidated statements of income for the three months ended March 31, 2026 and 2025:

The Effect of Fair Value and Cash Flow Hedge Accounting on the Consolidated Statements of Income
Location of Gain or (Loss) Recognized in Income on Derivative
03/31/2026 03/31/2025
(In thousands) Interest Income
Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded $ 32 $ 294
The effects of fair value and cash flow hedging:
Gain or (loss) on fair value hedging relationships in Subtopic 815-20
Interest contracts
Hedged items 9 340
Derivatives designated as hedging instruments 23 (46)

Tabular Disclosure of the Effect of Derivatives Not Designated as Hedging Instruments on the Income Statement

The table below presents the effect of the Company’s derivative financial instruments that are not designated as hedging instruments on the consolidated statements of income for the three months ending March 31, 2026 and March 31, 2025:

Effect of Derivatives Not Designated as Hedging Instruments on the Consolidated Statements of Income
Derivatives Not Designated as Hedging Instruments under Subtopic 815-20 Location of Gain or (Loss) Recognized in Income on Derivative Amount of Gain or (Loss) Recognized in Income on Derivative Amount of Gain or (Loss) Recognized in Income on Derivative
Three Months Ended
(In thousands) 03/31/2026 03/31/2025
Interest Rate Products Other Income $ (65) $ (111)
Risk Participation Agreement Other Income (4) 25
Total $ (69) $ (86)
Fee Income Other Income $ 58 $ 29

Credit-risk-related Contingent Features

Applicable for OTC derivatives with dealers

The Company's agreements with each of its derivative counterparties provide that if the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default on its derivative obligations.

As of March 31, 2026 and December 31, 2025, the fair value of derivatives in a net liability position, which includes accrued interest but excludes any adjustment for nonperformance risk, related to these agreements was $3.9 million and $5.3 million, respectively. As of March 31, 2026 and December 31, 2025, the Company had posted $3.4 million and $1.9 million, respectively, in collateral related to these agreements.

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

BUSINESS

Overview

Tompkins Financial Corporation ("Tompkins" or the "Company") is headquartered in Ithaca, New York and is registered as a Financial Holding Company with the Federal Reserve Board under the Bank Holding Company Act of 1956, as amended. The Company is a locally oriented, community-based financial services organization that offers a full array of products and services, including commercial and consumer banking, leasing, trust and investment management, and financial planning and wealth management. At March 31, 2026, the Company had one wholly-owned banking subsidiary, Tompkins Community Bank. Tompkins Community Bank provides a broad selection of wealth management services under the Tompkins Financial Advisors brand, including investment management, trust and estate, and financial and tax planning. On October 31, 2025, the Company sold all of the issued and outstanding shares of capital stock of its wholly-owned insurance subsidiary, Tompkins Insurance Agencies, Inc. ("TIA"), to Arthur J. Gallagher Risk Management Services, LLC ("Gallagher"). The Company’s principal offices are located at 118 E. Seneca Street, P.O. Box 460, Ithaca, NY, 14850, and its telephone number is (888) 503-5753. The Company’s common stock is traded on the NYSE American under the Symbol "TMP."

Tompkins' strategy centers around our core values and a commitment to delivering long-term value to our clients, communities, and shareholders. A key strategic initiative for the Company is a focus on responsible and sustainable growth, including initiatives to grow organically through our current businesses, as well as through possible acquisitions of financial institutions, branches, and financial services businesses. As such, the Company has acquired, and from time to time considers acquiring, banks, thrift institutions, branch offices of banks or thrift institutions, or other businesses that would complement the Company’s business or its geographic reach. The Company generally targets merger or acquisition partners that are culturally similar and have experienced management and possess either significant market presence or have potential for improved profitability through financial management, economies of scale and expanded services.

Business Segments

Banking services consist primarily of attracting deposits from the areas served by Tompkins Community Bank, which has 54 banking offices (38 offices in New York and 16 offices in Pennsylvania) and using those deposits to originate a variety of commercial loans, agricultural loans, consumer loans, real estate loans, and leases. The Company’s lending function is managed within the guidelines of a comprehensive Board-approved lending policy. Reporting systems are in place to provide management with ongoing information related to loan production, loan quality, concentrations of credit, loan delinquencies, and nonperforming and potential problem loans. Banking services also include a full suite of products such as debit cards, credit cards, remote deposit, electronic banking, mobile banking, cash management, and safe deposit services.

Wealth management services consist of investment management, trust and estate, and financial and tax planning services. Wealth management services are provided under the trade name Tompkins Financial Advisors.

The Company operated its wholly-owned insurance subsidiary, TIA, from 2001 until its sale to Gallagher on October 31, 2025. TIA was a full-service insurance agency that offered services such as property and casualty insurance, employee benefit consulting, and life, long-term care and disability insurance. TIA's revenue and expenses were consolidated into the Company's financial statements through October 31, 2025.

The Company’s principal expenses are interest on deposits, interest on borrowings, and operating and general administrative expenses, as well as provisions for credit losses. Funding sources, other than deposits, include borrowings, securities sold under agreements to repurchase, and cash flow from lending and investing activities.

Competition

Competition for commercial banking and other financial services is strong in the Company’s market areas. In one or more aspects of its business, Tompkins Community Bank competes with other commercial banks, savings and loan associations, credit unions, finance companies, internet-based financial services companies, mutual funds, brokerage and investment banking companies, and other financial intermediaries. Some of these competitors have substantially greater resources and lending capabilities and may offer services that the Company does not currently provide. The financial services industry continues to undergo rapid technological change with introductions of new technologies and services, including new ways that customers can make payments or manage their accounts, including through use of stablecoins and other forms of cryptocurrency, tokens, and other digital assets or alternative payment systems. The Company faces increasing competition from institutions not subject to the same the same extensive State and Federal regulations that govern financial holding companies and Federally-insured banks, including by financial technology companies, or "fintechs," which may offer bank-like products or services that compete directly with the Company’s products and services.

Competition among financial institutions is based upon interest rates offered on deposit accounts, interest rates charged on loans and other credit and service charges, the quality and scope of the services rendered, the convenience of facilities and services, and, in the case of loans to commercial borrowers, relative lending limits. Management believes that a community-based financial organization is better positioned to establish personalized financial relationships with both commercial customers and individual households. The Company’s community commitment and involvement in its primary market areas, as well as its commitment to quality and personalized financial services, are factors that contribute to the Company’s competitiveness. Management believes that the Company’s subsidiary bank can compete successfully in its primary market areas by making prudent lending decisions quickly and more efficiently than its competitors, without compromising asset quality or profitability. In addition, the Company focuses on providing unparalleled customer service, which includes offering a strong suite of products and services, including products that are accessible to our customers through digital means. Although management feels that this business model has caused the Company to grow its customer base in recent years and allows it to compete effectively in the markets it serves, we cannot assure you that such factors will result in future success.

Regulation

Banking and wealth management are highly regulated. As a financial holding company including a community bank and a registered investment adviser, the Company and its subsidiary are subject to examination and regulation by the Federal Reserve Board ("FRB"), Securities and Exchange Commission ("SEC"), the Federal Deposit Insurance Corporation ("FDIC"), the New York State Department of Financial Services, and the Financial Industry Regulatory Authority.

OTHER IMPORTANT INFORMATION

The following discussion is intended to provide an understanding of the consolidated financial condition and results of operations of the Company for the three months ended March 31, 2026. It should be read in conjunction with the Company’s Audited Consolidated Financial Statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, and the Unaudited Consolidated Financial Statements and notes thereto included in Part I of this Quarterly Report on Form 10-Q.

In this Report, there are comparisons of the Company’s performance to that of a peer group, which is comprised of 200 domestic bank holding companies with $3 billion to $10 billion in total assets as defined in the Federal Reserve’s "Bank Holding Company Performance Report" for December 31, 2025 (the most recent report available). Although the peer group data is presented based upon financial information that is one fiscal quarter behind the financial information included in this report, the Company believes that it is relevant to include certain peer group information for comparison to current quarter numbers.

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The statements contained in this Report that are not statements of historical fact may include forward-looking statements that involve a number of risks and uncertainties. Forward-looking statements may be identified by use of such words as "may", "could", "should", "will", "would", "estimate", "intend", "continue", "believe", "expect", "plan", "commit", or "anticipate", as well as the negative and other variations of these terms and other similar words. Examples of forward-looking statements may include statements regarding; the sufficiency of liquidity sources; the Company's exposure to changes in interest rates, and to new, changed, or extended government/regulatory expectations; the need to sell securities before recovery of amortized cost; the impact of changes in accounting standards; and trends, plans, prospects, growth and strategies; projections of future financial condition, operating results, income, capital expenditures, costs or other financial items; anticipated regulatory and legislative changes; and other characterizations of future events or circumstances as well as other statements that are not statements of historical fact. Forward-looking statements are made based on management’s expectations and beliefs concerning future events impacting the Company and are subject to uncertainties and factors relating to the Company’s operations and economic environment, all of which are difficult to predict and many of which are beyond the control of the Company, that could cause actual results of the Company to differ materially from those expressed and/or implied by forward-looking statements and historical performance. The following factors, in addition to those listed as Risk Factors in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025, are among those that could cause actual results to differ materially from the forward-looking statements and historical performance: changes in general economic, market and regulatory conditions; our ability to attract and retain deposits and other sources of liquidity; gross domestic product growth and inflation trends; the impact of the interest rate and inflationary environment on the Company's business, financial condition and results of operations; other income or cash flow anticipated from the Company's operations, investment and/or lending activities; changes in laws and regulations affecting public companies, banks, bank holding companies and/or financial holding companies, including the Dodd-Frank Act, and other federal, state and local government mandates; the impact of any change in the FDIC insurance assessment rate or the rules and regulations related to the calculation of the FDIC insurance assessment amount; changes in supervisory and regulatory scrutiny of financial institutions; technological developments and

changes; cybersecurity incidents and threats; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; governmental and public policy changes, including environmental regulation; reliance on large customers and the geographic concentration of our business; the ability to access financial resources in the amounts, at the times, and on the terms required to support the Company's future businesses; and the economic impact, including potential market volatility, of national and global events, including the response to bank failures, war and geopolitical matters (including continuing or increasing hostilities in the Middle East and the war in Ukraine), tariffs and trade wars, widespread protests, civil unrest, political uncertainty, and pandemics or other public health crises; and the related financial stress on borrowers and changes to customer behavior and credit risk as a result of any of the foregoing. The Company does not undertake any obligation to update its forward-looking statements.

Critical Accounting Policies

The accounting and reporting policies followed by the Company conform, in all material respects, to U.S. generally accepted accounting principles ("GAAP") and to general practices within the financial services industry. In the course of normal business activity, management must select and apply many accounting policies and methodologies and make estimates and assumptions that lead to the financial results presented in the Company’s consolidated financial statements and accompanying notes. There are uncertainties inherent in making these estimates and assumptions, which could materially affect the Company’s results of operations and financial position.

Management considers accounting estimates to be critical to reported financial results if (i) the accounting estimates require management to make assumptions about matters that are highly uncertain, and (ii) different estimates that management reasonably could have used for the accounting estimate in the current period, or changes in the accounting estimate that are reasonably likely to occur from period to period, could have a material impact on the Company’s financial statements. Management considers the accounting policy relating to the allowance for credit losses ("allowance", or "ACL") to be a critical accounting policy because of the uncertainty and subjectivity involved in this policy and the material effect that estimates related to this area can have on the Company’s results of operations.

The Company’s methodology for estimating the allowance considers available relevant information about the collectability of cash flows, including information about past events, current conditions, and reasonable and supportable forecasts. Refer to "Financial Condition - Allowance for Credit Losses" below, and to Note 5 - "Allowance for Credit Losses" and Note 1 – "Summary of Significant Accounting Policies" in the Notes to Consolidated Financial Statements contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2025.

For information on the Company's significant accounting policies and to gain a greater understanding of how the Company’s financial performance is reported, refer to Note 1 – "Summary of Significant Accounting Policies" in the Notes to Consolidated Financial Statements contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. Refer to "Accounting Standards Pending Adoption" in Note 2 - "Basis of Presentation" in the Notes to Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for a discussion of recent accounting standards updates.

Critical Accounting Estimates

The Company's significant accounting policies conform with GAAP and are described in Note 1 "Summary of Significant Accounting Policies" in the Notes to Consolidated Financial Statements contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2025. In applying those accounting policies, management of the Company is required to exercise judgment in determining many of the methodologies, assumptions and estimates to be utilized. Certain critical accounting estimates are more dependent on such judgment and in some cases may contribute to volatility in the Company's reported financial performance should the assumptions and estimates used change over time due to changes in circumstances. The most significant area in which management of the Company applies critical assumptions and estimates is the following:

•Accounting for credit losses - The Company accounts for the allowance for credit losses using the current expected credit loss model. Under this model, the allowance for credit losses represents a valuation account that is deducted from the amortized cost basis of certain financial assets, including loans and leases, to present the net amount expected to be collected at the balance sheet date. A provision for credit losses is recorded to adjust the level of the allowance as deemed necessary by management. In estimating expected losses in the loan and lease portfolio, borrower-specific financial data and macro-economic assumptions are utilized to project losses over a reasonable and supportable forecast period. For certain loan pools that share similar risk characteristics, the Company utilizes statistically developed models to estimate amounts and timing of expected future cash flows, collateral values and other factors used to determine the borrowers' abilities to repay obligations. Such models consider historical correlations of credit losses with various macroeconomic assumptions including unemployment and gross domestic product. These forecasts may be adjusted for inherent limitations or biases of the models. Subsequent to the forecast period, the Company utilizes longer-term historical loss experience to estimate losses over the remaining contractual life of the loans.

Changes in the circumstances considered when determining management's estimates and assumptions could result in changes in those estimates and assumptions, which could result in adjustment of the allowance for credit losses in future periods. A discussion of facts and circumstances considered by management in determining the allowance for credit losses is included herein in Note 5 - "Allowance for Credit Losses" in the Notes to the Unaudited Consolidated Financial Statements.

RESULTS OF OPERATIONS

Performance Summary

Net income for the first quarter of 2026 was $26.1 million or $1.82 diluted earnings per share, compared to $19.7 million or $1.37 diluted earnings per share for the same period in 2025. The increase in net income from the first quarter of 2025 was mainly a result of higher net interest income, driven by increased interest income on loans and securities and lower funding costs; lower provision expense; and lower noninterest expenses.

Return on average assets ("ROA") for the quarter ended March 31, 2026 was 1.23%, compared to 0.99% for the quarter ended March 31, 2025. Return on average shareholders’ equity ("ROE") for the first quarter of 2026 was 11.11%, compared to 10.96% for the same period in 2025.

Segment Reporting

The Company operates in the following two business segments: banking and wealth management. Wealth management activities include the results of the Company's trust, financial planning, and wealth management services provided by Tompkins Financial Advisors, a division of Tompkins Community Bank. All other activities are considered banking. Prior to the sale of TIA on October 31, 2025, the Company also had an insurance segment. TIA provided property and casualty insurance services and employee benefits consulting. For additional financial information on the Company's segments, refer to "Note 9 - Segment and Related Information" in the Notes to Consolidated Financial Statements in Part I of this Report on Form 10-Q.

Banking Segment

The banking segment reported net income of $25.2 million for the first quarter of 2026, an increase of $9.5 million or 60.4% from net income of $15.7 million for the same period in 2025. The increase in net income for the first quarter of 2026 compared to the first quarter of 2025 was primarily due to an increase in net interest margin and a reduction in provision expense. Net interest income of $71.9 million for the first quarter of 2026 was up $15.2 million or 26.8% from the same period in 2025. The increase in net interest income was primarily due to higher yields on interest earning assets, growth in average interest earning assets and a reduction in funding costs. The provision for credit loss expense was $1.5 million for the three months ended March 31, 2026, compared to a provision expense of $5.3 million for the same period in 2025.

Noninterest income of $6.5 million for the three months ended March 31, 2026 was down $2.2 million or 25.2% compared to the same period in 2025. The decrease in noninterest income for the three months ended March 31, 2026 compared to the same period in 2025 was mainly attributable to a gain on the sale of other real estate owned ("OREO") of $1.9 million recorded in the prior period.

Noninterest expense of $43.6 million for the first quarter of 2026 was up $3.9 million or 9.8% from the same period in 2025. The increase was driven primarily by higher salaries and employee benefits, which increased $2.7 million, along with higher technology and furniture, fixtures, and equipment expenses.

Wealth Management Segment

The wealth management segment reported net income of $914,000 for the three months ended March 31, 2026, which was up $93,000 or 11.3% compared to the first quarter of 2025. The increase in net income for the three month period ended March 31, 2026, compared to the same period in 2025, was mainly attributable to an increase in asset-based advisory revenue. Noninterest expense for the first quarter of 2026 was in line with the same period prior year.

Average Net Interest Income

The following tables show average interest-earning assets and interest-bearing liabilities, and the corresponding yield or cost associated with each, for each of the three month periods ended March 31, 2026, December 31, 2025, and March 31, 2025:

Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited)
Quarter Ended Quarter Ended Quarter Ended
March 31, 2026 December 31, 2025 March 31, 2025
(dollar amounts in thousands) Average <br>Balance <br>(QTD) Interest Average <br>Yield/Rate Average <br>Balance <br>(QTD) Interest Average <br>Yield/Rate Average <br>Balance <br>(QTD) Interest Average <br>Yield/Rate
ASSETS
Interest-earning assets
Interest-bearing balances due from banks $ 13,394 $ 166 5.03 % $ 17,795 $ 211 4.70 % $ 16,424 $ 175 4.32 %
Securities1
U.S. Government securities 1,636,770 14,435 3.58 % 1,595,043 12,244 3.04 % 1,598,785 9,441 2.39 %
State and municipal2 81,218 536 2.68 % 81,613 537 2.61 % 85,893 554 2.62 %
Other Securities2 3,305 49 6.01 % 3,298 52 6.25 % 3,275 53 6.56 %
Total securities 1,721,293 15,020 3.54 % 1,679,954 12,833 3.03 % 1,687,953 10,048 2.41 %
FHLBNY and FRB stock 29,016 460 6.43 % 24,113 593 9.76 % 31,983 711 9.01 %
Total loans and leases, net of unearned income2,3 6,434,853 87,337 5.50 % 6,336,565 87,612 5.48 % 6,025,363 78,835 5.31 %
Total interest-earning assets 8,198,556 102,983 5.09 % 8,058,427 101,249 4.98 % 7,761,723 89,769 4.69 %
Other assets 382,767 313,860 294,855
Total assets $ 8,581,323 $ 8,372,287 $ 8,056,578
LIABILITIES & EQUITY
Deposits
Interest-bearing deposits
Interest bearing checking, savings, & money market $ 3,823,812 $ 15,589 1.65 % $ 3,779,290 $ 16,695 1.75 % $ 3,682,318 $ 16,093 1.77 %
Time deposits 1,285,701 10,420 3.29 % 1,282,009 11,150 3.45 % 1,159,039 10,557 3.69 %
Total interest-bearing deposits 5,109,513 26,009 2.06 % 5,061,299 27,845 2.18 % 4,841,357 26,650 2.23 %
Federal funds purchased & securities sold under agreements to repurchase 42,788 18 0.17 % 42,221 21 0.20 % 47,653 41 0.35 %
Other borrowings 491,310 4,781 3.95 % 380,920 3,983 4.15 % 561,983 6,109 4.41 %
Total interest-bearing liabilities 5,643,611 30,808 2.21 % 5,484,440 31,849 2.30 % 5,450,993 32,800 2.44 %
Noninterest bearing deposits 1,855,440 1,911,583 1,779,197
Accrued expenses and other liabilities 130,879 100,606 98,278
Total liabilities 7,629,930 7,496,629 7,328,468
Tompkins Financial Corporation Shareholders’ equity 951,393 875,658 728,110
Total equity 951,393 875,658 728,110
Total liabilities and equity $ 8,581,323 $ 8,372,287 $ 8,056,578
Interest rate spread 2.88 % 2.68 % 2.25 %
Tax-equivalent net interest income/margin on earning assets 72,175 3.57 % 69,400 3.42 % 56,969 2.98 %
Tax-equivalent adjustment (314) (339) (307)
Net interest income $ 71,861 $ 69,061 $ 56,662

1 Average balances and yields on available-for-sale debt securities are based on historical amortized cost.

2 Interest income includes the tax effects of taxable-equivalent adjustments using an effective income tax rate of 21% in 2026 and 2025 to increase tax exempt interest income to taxable-equivalent basis.

3 Nonaccrual loans are included in the average asset totals presented above. Payments received on nonaccrual loans have been recognized as disclosed in Note 1 of the Company’s consolidated financial statements included in Part 1 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

Net Interest Income

Net interest income is the Company’s largest source of revenue, representing 85.9% of total revenues for the three months ended March 31, 2026, compared to 69.4% for the same period in 2025. Net interest income is dependent on the volume and composition of interest-earning assets and interest-bearing liabilities and the level of market interest rates. The above table

shows average interest-earning assets and interest-bearing liabilities, and the corresponding yield or cost associated with each, for the periods indicated.

Net interest income for the three months ended March 31, 2026 of $71.9 million was up $15.2 million or 26.8% from the same period in 2025. The increase in net interest income was due to improvement in net interest margin, which is discussed below, and growth in average loans. The average yield on interest-earning assets for the three months ended March 31, 2026 was up 40 basis points over the same period in 2025, while the average cost of interest-bearing liabilities was down 23 basis points over the same period.

Net interest margin for the three months ended March 31, 2026 was 3.57% compared to 3.42% for the most recent prior quarter, and 2.98% for the first quarter of 2025. The increase in net interest margin over the prior periods reflects growth in average loan balances, improved yields on average earnings assets, and lower funding costs.

Interest income for the three months ended March 31, 2026 was $102.7 million, up $13.2 million or 14.8% compared to the same period in 2025. The increase in interest income was mainly in interest and fees on loans, which were up $8.5 million or 10.8%, driven by higher yields and higher average balances for the three months ended March 31, 2026, compared to the same period in 2025. Average loan balances for the first quarter of 2026 were up $409.5 million or 6.8% from the first quarter of 2025, while the 5.50% average yield on loans for the first quarter of 2026 was up 19 basis points from the average yield on loans for the first quarter of 2025.

Interest income on securities, excluding dividends on FHLB stock, for the three months ended March 31, 2026, was up $5.0 million or 50.0% as compared to the same period in 2025. Average yield on securities for the first quarter of 2026 was up 113 basis points over the first quarter of 2025, mainly a result of the reinvestment within the portfolio at higher yields, including the previously reported repositioning of the portfolio in the fourth quarter of 2025. Average balances for securities for the first quarter of 2026 increased $33.3 million, or 2.0%, over the same period in 2025.

Interest expense for the three months ended March 31, 2026 decreased by $2.0 million or 6.1% compared to the same period in 2025, driven mainly by a decrease in average rates paid on interest-bearing liabilities, partially offset by higher average balances of interest-bearing liabilities. The average cost of interest-bearing liabilities for the first quarter of 2026 was 2.21%, a decrease of 23 basis points from the first quarter of 2025, as a result of lower market interest rates and improved funding mix, as deposit growth contributed to a decrease in average borrowings.

Average interest-bearing deposits for the first quarter of 2026 were up $268.2 million or 5.5% over the same period in 2025. The growth was largely in interest-bearing checking, savings, and money market accounts, which were up $141.5 million or 3.8% for the first quarter of 2026 compared to the same period in 2025. The average cost of interest-bearing deposits for the first quarter of 2026 compared to the same period in 2025 was down 17 basis points or 7.6%. Average noninterest bearing deposit balances for the first quarter of 2026 increased $76.4 million or 4.3% compared to the first quarter of 2025.

Average other borrowings for the three months ended March 31, 2026 were down $70.7 million or 12.6% compared to the same period in 2025. The average rate paid on other borrowings for the first quarter of 2026 was down 46 basis points from the same period in 2025.

Noninterest Income

Noninterest income was $11.8 million for the first quarter of 2026, down $13.2 million or 52.7% compared to the first quarter of 2025. Noninterest income represented 14.1% of total revenue for the three months ended March 31, 2026, compared to 30.6% for the same period in 2025. The decrease was mainly in insurance commissions and fees and reflects the sale of the Company's insurance subsidiary, TIA, in October 2025. Insurance revenues were $11.6 million in the first quarter of 2025.

Wealth management fees for the first quarter of 2026 were up $147,000 or 2.9% over the first quarter of 2025, driven by an increase in advisory assets under management. Wealth management fees include trust services, financial planning, wealth management services, and brokerage related services and are generally based on the market value of assets within an account and are thus impacted by volatility in equity and bond markets. The fair value of assets managed by, or in custody of, Tompkins was $2.9 billion at March 31, 2026, down from $3.1 billion at March 31, 2025.

Other income of $2.1 million in the first quarter of 2026 was down $1.7 million or 44.8% compared to the same period in 2025. The decrease in the first quarter of 2026 compared to the same period in 2025 was driven by a $1.9 million gain on the sale of other real estate owned in 2025.

Noninterest Expense

Noninterest expense was $47.7 million for the first quarter of 2026, down $2.9 million or 5.7% compared to the same period in 2025. Noninterest expense as a percentage of total revenue for the first quarter of 2026 was 57.0% compared to 61.9% for the same period in 2025. The decrease mainly reflects the sale of the Company's insurance subsidiary, TIA, in October 2025.

Expenses associated with salaries and wages and employee benefits are the largest component of noninterest expense, representing 60.3% of total noninterest expense for the first quarter of 2026, compared to 63.4% for the first quarter of 2025. Salaries and wages and employee benefits expense for the three months ended March 31, 2026 were down $3.3 million or 10.4% compared to the first quarter of 2025. Salaries, wages and employee benefits expense attributable to TIA were $6.0 million in the first quarter of 2025. Partially offsetting the decrease in employee related costs relative to the sale of TIA, were increases in strategic hiring in the bank, annual merit increases and increases in other employee benefits. Also contributing to the year-over-year decrease were net occupancy expenses, down $115,000 or 3.2%, and amortization expense, down $84,000 or 100.0%, with first quarter 2025 TIA expenses in the same categories of $279,000 and $81,000, respectively.

Income Tax Expense

The provision for income taxes was $8.4 million for an effective rate of 24.4% for the first quarter of 2026, compared to provision expense of $6.1 million and an effective rate of 23.7% for the same quarter in 2025. The effective rates differ from the U.S. statutory rate primarily due to the effect of tax-exempt income from loans, securities and life insurance assets, and the income tax effects associated with stock-based compensation.

FINANCIAL CONDITION

Total assets were $8.7 billion at March 31, 2026, up $27.5 million or 0.3% from December 31, 2025. Cash and cash equivalents were up $38.6 million or 29.1%, total loans were up $31.7 million or 0.5%, total securities were up $6.9 million or 0.4% and loans held for sale were down $43.4 million compared to December 31, 2025. Total deposits were up $116.4 million or 1.7%, Federal funds purchased and securities sold under agreement to repurchase were up $22.6 million or 23.6%, and total borrowings were down $115.0 million or 20.4% from December 31, 2025.

Securities

As of March 31, 2026, the Company’s securities portfolio was $1.7 billion or 19.6% of total assets, in line with year-end 2025. The following table details the composition of the securities portfolio:

Available-for-Sale Debt Securities
March 31, 2026 December 31, 2025
(In thousands) Amortized Cost Fair Value Amortized Cost Fair Value
U.S. Treasuries $ 45,577 $ 43,742 $ 55,492 $ 53,780
Obligations of U.S. Government sponsored entities 348,769 340,509 354,128 348,403
Obligations of U.S. states and political subdivisions 80,622 74,641 81,517 76,310
Mortgage-backed securities - residential, issued by
U.S. Government agencies 308,634 306,455 315,001 313,496
U.S. Government sponsored entities 621,668 621,112 582,741 587,632
U.S. corporate debt securities 2,500 2,451 2,500 2,447
Total available-for-sale debt securities $ 1,407,770 $ 1,388,910 $ 1,391,379 $ 1,382,068 Held-to-Maturity Debt Securities
--- --- --- --- --- --- --- --- ---
March 31, 2026 December 31, 2025
(In thousands) Amortized Cost Fair Value Amortized Cost Fair Value
U.S. Treasuries $ 85,775 $ 78,428 $ 85,831 $ 78,794
Obligations of U.S. Government sponsored entities 226,770 204,161 226,697 205,066
Total held-to-maturity debt securities $ 312,545 $ 282,589 $ 312,528 $ 283,860

The increase in unrealized losses, which reflects the amount that amortized cost exceeds fair value, related to the available-for-sale debt and held-to-maturity debt portfolios was due primarily to changes in market interest rates during the first three months

of 2026. Management’s policy is to purchase investment grade securities that on average have relatively short duration, which helps mitigate interest rate risk and provides sources of liquidity without significant risk to capital.

The Company did not recognize any net credit impairment charge to earnings on investment securities in the first quarter of 2026.

Loans and Leases

Loans and leases as of the end of the first quarter and prior year-end were as follows:

(In thousands) 03/31/2026 12/31/2025
Commercial and industrial
Agriculture $ 104,534 $ 114,475
Commercial and industrial other 1,013,267 986,173
Subtotal commercial and industrial 1,117,801 1,100,648
Commercial real estate
Construction 471,378 448,901
Agriculture 238,165 234,292
Commercial real estate other 2,972,270 2,978,842
Subtotal commercial real estate 3,681,813 3,662,035
Residential real estate
Home equity 229,927 227,654
Mortgages 1,359,102 1,363,532
Subtotal residential real estate 1,589,029 1,591,186
Consumer and other
Indirect 58 68
Consumer and other 83,609 86,399
Subtotal consumer and other 83,667 86,467
Leases 9,653 10,413
Total loans and leases 6,481,963 6,450,749
Less: unearned income and deferred costs and fees (4,020) (4,504)
Total loans and leases, net of unearned income and deferred costs and fees $ 6,477,943 $ 6,446,245

The table below shows a more detailed break-out of commercial real estate loans as of March 31, 2026 and December 31, 2025.

03/31/2026 12/31/2025
(In thousands) Balance % CRE Balance % CRE
Construction $ 471,378 12.80 % $ 448,901 12.26 %
Multi-family/Single family real estate 763,885 20.75 % 774,338 21.15 %
Agriculture 238,165 6.47 % 234,292 6.40 %
Retail1 496,130 13.48 % 508,523 13.89 %
Hotels/motels 187,852 5.10 % 181,026 4.94 %
Office space2 245,136 6.66 % 243,874 6.66 %
Industrial3 258,940 7.03 % 253,959 6.93 %
Mixed Use 351,386 9.54 % 362,900 9.91 %
Medical4 144,087 3.91 % 150,499 4.11 %
Other 524,854 14.26 % 503,723 13.75 %
Total $ 3,681,813 100.00 % $ 3,662,035 100.00 %
1Retail included 2.04% and 2.10%, respectively, of owner occupied real estate at March 31, 2026 and December 31, 2025.
2Office space included 1.68% and 1.65%, respectively, of owner occupied real estate at March 31, 2026 and December 31, 2025.
3Industrial included 2.95% and 2.79%, respectively, of owner occupied real estate at March 31, 2026 and December 31, 2025.
4Medical included 1.49% and 1.71%, respectively, of owner occupied real estate at March 31, 2026 and December 31, 2025.

Total loans and leases of $6.5 billion at March 31, 2026 were up $31.7 million or 0.5% from December 31, 2025. The increase was mainly in commercial real estate loans, which were up $19.8 million or 0.5%, to $3.7 billion at March 31, 2026. As of March 31, 2026, total loans and leases represented 74.5% of total assets compared to 74.4% of total assets at December 31, 2025.

Residential real estate loans, including home equity loans, were $1.6 billion at March 31, 2026, down $2.2 million or 0.14% compared to December 31, 2025, and comprised 24.5% of total loans and leases at March 31, 2026. Changes in residential real estate loan balances are impacted by the Company’s decision to retain these loans or sell them in the secondary market due to interest rate considerations. The Company’s Asset/Liability Committee meets regularly and establishes standards for selling and retaining residential real estate mortgage originations. These residential real estate loans are generally sold to Federal Home Loan Mortgage Corporation ("FHLMC") without recourse in accordance with standard secondary market loan sale agreements. These residential real estate loans also are subject to customary representations and warranties made by the Company, including representations and warranties related to gross incompetence or negligence, and fraud. The Company has not had to repurchase any loans as a result of these representations and warranties.

During the first three months of 2026 and 2025, the Company sold residential real estate loans totaling $24.4 million and $11.6 million, respectively, recognizing gains on these sales of $705,000 and $454,000, respectively. These residential real estate loans were sold without recourse in accordance with standard secondary market loan sale agreements. When residential mortgage loans are sold, the Company typically retains all servicing rights, which provides the Company with a source of fee income. Mortgage servicing rights totaled $1.8 million at March 31, 2026 and $1.7 million at December 31, 2025.

Commercial real estate loans and commercial and industrial loans totaled $3.7 billion and $1.1 billion, respectively, and represented 56.8% and 17.3%, respectively, of total loans at March 31, 2026. Commercial real estate loans and commercial and industrial loans as of March 31, 2026 were up $19.8 million or 0.5% and $17.2 million or 1.6% over year-end 2025, respectively.

As of March 31, 2026, agriculturally-related loans totaled $342.7 million or 5.3% of total loans and leases, compared to $348.8 million or 5.4% of total loans and leases at December 31, 2025. Agriculturally-related loans include loans to dairy farms and crop farms. Agriculturally-related loans are primarily made based on identified cash flows of the borrower with consideration given to underlying collateral, personal guarantees, and government related guarantees. Agriculturally-related loans are generally secured by the assets or property being financed or other business assets such as accounts receivable, livestock, equipment or commodities/crops.

The Company’s loan and lease customers are located primarily in the New York and Pennsylvania communities served by its subsidiary bank. As a result of its geographic concentration in New York and Pennsylvania, the Company is dependent on the general economic conditions of these states and the local economic conditions of the communities within those states in which the Company does business.

Allowance for Credit Losses

The tables below represent the allowance for credit losses as of March 31, 2026, December 31, 2025, and March 31, 2025. The tables provide, as of the dates indicated, an allocation of the allowance for credit losses for inherent loan losses by type. The allocation is neither indicative of the specific amounts or the loan categories in which future charge-offs may occur, nor is it an indicator of future loss trends. The allocation of the allowance for credit losses to each category does not restrict the use of the allowance to absorb losses in any category.

(In thousands) 03/31/2026 12/31/2025 03/31/2025
Allowance for credit losses
Commercial and industrial $ 10,723 $ 10,234 $ 8,618
Commercial real estate 35,568 35,255 39,308
Residential real estate 10,566 10,893 11,542
Consumer and other 1,191 1,230 1,497
Finance leases 60 59 58
Total $ 58,108 $ 57,671 $ 61,023
Allowance for credit losses as a percentage of total loans and leases 0.90 % 0.89 % 1.01 %
Allowance/nonperforming loans and leases 113.06 % 120.30 % 85.85 %

Activity in the Company’s allowance for credit losses during the first three months of 2026 and 2025 is illustrated in the table below:

Analysis of the Allowance for Credit Losses
(In thousands) 03/31/2026 03/31/2025
Average loans outstanding during period $ 6,434,853 $ 6,025,363
Balance of allowance at beginning of year 57,671 56,496
LOANS CHARGED-OFF:
Commercial and industrial 336 185
Commercial real estate 0 0
Residential real estate 250 0
Consumer and other 416 779
Total loans charged-off $ 1,002 $ 964
RECOVERIES OF LOANS PREVIOUSLY CHARGED-OFF:
Commercial and industrial 17 42
Commercial real estate 6 2
Residential real estate 63 27
Consumer and other 141 160
Total loans recovered $ 227 $ 231
Net loans charged-off (recovered) 775 733
Provision for credit losses related to loans 1,212 5,260
Balance of allowance at end of period $ 58,108 $ 61,023
Annualized net charge-offs on loans to average total loans and leases during the period 0.05 % 0.05 %

As of March 31, 2026, the allowance for credit losses was $58.1 million, up $437,000 or 0.8% compared to December 31, 2025, and down $2.9 million or 4.8% compared to March 31, 2025. The allowance for credit losses as a percentage of total loans measured 0.90% at March 31, 2026, up compared to 0.89% reported at December 31, 2025, and down from 1.01% at March 31, 2025. The decrease in the allowance for credit losses coverage ratio at March 31, 2026, compared to March 31,

2025, was mainly due to lower reserves for individually analyzed loans. The allowance for credit losses at March 31, 2025, included a specific reserve of $4.2 million for one commercial real estate relationship totaling $18.1 million.

The ratio of the allowance to nonperforming loans and leases was 113.06% at March 31, 2026, compared to 120.30% at December 31, 2025, and 85.85% at March 31, 2025. The decrease in the ratio compared to year-end 2025 was due to an increase in nonperforming loans and leases. At March 31, 2026 nonperforming loans and leases were $3.5 million or 7.2% higher than at December 31, 2025. The Company’s nonperforming loans and leases are mostly comprised of collateral-dependent loans with limited exposure or loans that require limited specific reserve due to the level of collateral available with respect to these loans and/or previous charge-offs.

The provision expense for credit losses for loans is based upon the Company's quarterly evaluation of the appropriateness of the allowance for credit losses. The provision for credit losses for loans for the first quarter of 2026 was $1.2 million compared to $5.3 million for the first quarter of 2025. The decrease in provision expense is mainly reflective of the previously discussed specific reserve on one commercial real estate relationship. Net charge-offs for the three months ended March 31, 2026 were $775,000, compared to $3.3 million for the fourth quarter of 2025, and $733,000 for the first quarter of 2025.

Allowance for Credit Losses on Off-Balance Sheet Credit Exposures

For the three months ended March 31, 2026, the provision for credit losses on off-balance sheet credit exposures was $290,000 compared to $27,000 for the same period in 2025. The year-over-year increase in provision expense was mainly a result of increases in off-balance sheet exposures related to the commercial loan pipeline. For additional information on the Company's off-balance sheet commitments, refer to "Note 5 - Allowance for Credit Losses" in the Notes to Consolidated Financial Statements in Part I of this Report on Form 10-Q.

Analysis of Past Due and Nonperforming Loans
(In thousands) 03/31/2026 12/31/2025 03/31/2025
Loans 90 days past due and accruing
Residential real estate $ 1 $ 1 $ 1
Consumer and other 123 145 186
Total loans 90 days past due and accruing $ 124 $ 146 $ 187
Nonaccrual loans
Commercial and industrial 11,355 8,305 2,477
Commercial real estate 22,481 22,864 51,155
Residential real estate 17,378 16,555 17,141
Consumer and other 57 70 118
Total nonaccrual loans $ 51,271 $ 47,794 $ 70,891
Total nonperforming loans and leases $ 51,395 $ 47,940 $ 71,078
Other real estate owned 269 229 81
Total nonperforming assets $ 51,664 $ 48,169 $ 71,159
Total nonperforming loans and leases as percentage of total loans and leases 0.79 % 0.74 % 1.17 %
Total nonperforming assets as percentage of total assets 0.59 % 0.56 % 0.87 %

Asset quality measures at March 31, 2026 were stable compared to December 31, 2025. Loans internally-classified Special Mention or Substandard totaled $120.4 million at March 31, 2026, down $14.0 million or 10.4% compared to December 31, 2025. Loans past due 30-89 days totaled $5.9 million at March 31, 2026, down $2.9 million from year-end 2025.

Nonperforming assets include loans past due 90 days and accruing, nonaccrual loans, and foreclosed real estate/other real estate owned. Total nonperforming assets of $51.7 million at March 31, 2026 were up $3.5 million or 7.3% compared to December 31, 2025, and down $19.5 million or 27.4% compared to March 31, 2025. Nonperforming assets represented 0.59% of total assets at March 31, 2026, up from 0.56% at December 31, 2025, and 0.87% at March 31, 2025. Our peer group's average ratio of nonperforming assets to total assets was 0.52% at December 31, 2025.

Deposits and Other Liabilities

Total deposits of $7.1 billion at March 31, 2026 were up $116.4 million or 1.7% from December 31, 2025. The increase from year-end was primarily in checking, money market and savings balances, which collectively were up $147.6 million or 3.9%.

The increase in checking, money market and savings balances was mainly in municipal deposits. The increase was partially offset by decreases in non-interest bearing deposits, down $25.2 million or 1.3%.

The Company is a participant in the IntraFi Network's IntraFi Cash Service (ICS) and Certificate of Deposit Account Registry Service (CDARS) programs. The Company uses these deposit sweep services to place customer funds from interest-bearing demand accounts, money market accounts, and/or time deposits to be placed with other participating network banks. Customer funds are placed at one or more participating banks to ensure that each deposit customer is eligible for the full amount of FDIC insurance. As a program participant, we receive reciprocal amounts of deposits from other participating network banks equal to the amount of our customer funds placed in the IntraFi Network. In addition to the reciprocal funding programs, the Company may utilize both the ICS and CDARS programs to obtain wholesale funding through One-Way Buy transactions. Funds obtained using one-way buy transactions are classified as brokered deposits. At March 31, 2026 the Company held $950,000 in CDARS one-way buy funds.

The most significant source of funding for the Company is core deposits. The Company defines core deposits as total deposits less time deposits of $250,000 or more, brokered deposits, municipal money market deposits and reciprocal deposit relationships with municipalities. Core deposits decreased by $14.4 million or 0.3% from year-end 2025, to $5.5 billion at March 31, 2026. Core deposits represented 78.0% of total deposits at March 31, 2026, compared to 79.5% of total deposits at December 31, 2025.

The Company uses both retail and wholesale repurchase agreements. Retail repurchase agreements are arrangements with local customers of the Company in which the Company agrees to sell securities to the customer with an agreement to repurchase those securities at a specified later date. Retail repurchase agreements totaled $68.1 million at March 31, 2026 and $45.6 million at December 31, 2025. Management generally views local repurchase agreements as an alternative to large time deposits.

The Company has established several unsecured Federal funds purchased lines through various correspondent bank relationships, totaling $149.0 million as of March 31, 2026. At March 31, 2026, the Company had outstanding $50.0 million of overnight Federal funds purchased, which was unchanged from December 31, 2025.

The Company’s other borrowings totaled $449.4 million at March 31, 2026, down $115.0 million or 20.4% compared to $564.4 million at December 31, 2025. The increases in deposit balances, Federal funds purchased, and retail repurchase agreements contributed to the decrease in other borrowings. Other borrowings at March 31, 2026 included $325.0 million in overnight advances from the FHLB and $124.4 million of FHLB term advances. The $564.4 million in other borrowings at December 31, 2025 included $395.0 million in overnight advances from the FHLB and $169.4 million in term advances from the FHLB. Of the $124.4 million in FHLB term advances at March 31, 2026, $75.0 million is due in over one year; unchanged from December 31, 2025.

Capital

Total equity was $946.7 million at March 31, 2026, an increase of $8.4 million or 0.9% from December 31, 2025. The increase was mainly a result of the $16.4 million or 2.5% increase in retained earnings; partially offset by a $7.1 million increase in accumulated other comprehensive loss, reflecting the change in unrealized loss on available-for-sale debt securities from an unrealized loss of $7.0 million at December 31, 2025 to an unrealized loss of $14.1 million at March 31, 2026.

Cash dividends paid in the first three months of 2026 totaled approximately $9.7 million or $0.67 per common share, representing 37.0% of year to date 2026 earnings through March 31, 2026, and up 8.1% compared to cash dividends of $8.9 million or $0.62 per common share paid in the first three months of 2025.

On July 24, 2025, the Company’s Board of Directors authorized a share repurchase plan (the “2025 Repurchase Plan”) under which the Company may repurchase up to 400,000 shares of the Company’s common stock over the 24 months following adoption of the plan. Shares may be repurchased from time to time under the 2025 Repurchase Plan in open market transactions at prevailing market prices, in privately negotiated transactions, or by other means in accordance with federal securities laws. The Company has no obligation to repurchase any shares and may discontinue repurchases at any time. The Company repurchased 23,731 shares at an average price of $76.55 during the first quarter of 2026. As of March 31, 2026, a total of 46,070 shares at an average price of $75.25 had been repurchased under the 2025 Repurchase Plan.

The Company and its subsidiary bank are subject to various regulatory capital requirements administered by Federal bank regulatory 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 adverse effect on the Company’s business, results of operation and financial condition. Under capital adequacy guidelines and the regulatory framework for prompt corrective action (PCA), banks must meet specific guidelines that involve quantitative measures of assets, liabilities, and certain

off-balance-sheet items as calculated under regulatory accounting practices. Capital amounts and classifications of the Company and its subsidiary banks are also subject to qualitative judgments by regulators concerning components, risk weightings, and other factors. Quantitative measures established by regulation to ensure capital adequacy require the maintenance of minimum amounts and ratios of common equity Tier 1 capital, Total capital and Tier 1 capital to risk-weighted assets, and of Tier 1 capital to average assets. Management believes that the Company and its subsidiary bank meet all capital adequacy requirements to which they are subject.

The following table provides a summary of the Company’s capital ratios as of March 31, 2026:

Regulatory Capital Analysis
March 31, 2026 Actual Well Capitalized Requirement
(dollar amounts in thousands) Amount Ratio Amount Ratio
Total Capital (to risk weighted assets) $ 959,902 14.78 % $ 649,575 10.00 %
Tier 1 Capital (to risk weighted assets) 900,071 13.86 % 519,660 8.00 %
Tier 1 Common Equity (to risk weighted assets) 900,071 13.86 % 422,224 6.50 %
Tier 1 Capital (to average assets) 900,071 10.58 % 425,411 5.00 %

As of March 31, 2026, the Company’s capital ratios exceeded the minimum required capital ratios plus the fully phased-in capital conservation buffer, and the minimum required capital ratios for well capitalized institutions. The capital levels required to be considered well capitalized, presented in the above table, are based upon prompt corrective action regulations, as amended to reflect the changes under Basel III Capital Rules.

Total capital as a percentage of risk weighted assets was 14.8% at March 31, 2026, up from 14.6% as of December 31, 2025. Tier 1 capital as a percentage of risk weighted assets was 13.9% as of March 31, 2026, an increase from 13.6% at year-end 2025. Tier 1 capital as a percentage of average assets was 10.6% at March 31, 2026, unchanged from December 31, 2025. Common equity Tier 1 capital was 13.9% at the end of the first quarter of 2026, up from 13.6% at the end of 2025.

As of March 31, 2026, the capital ratios for the Company’s subsidiary bank also exceeded the minimum required capital ratios plus the fully phased-in capital conservation buffer, and the minimum required capital ratios for well capitalized institutions.

Liquidity

The objective of liquidity management is to ensure the availability of adequate funding sources to satisfy anticipated demand for credit, deposit withdrawals, and business investment opportunities. The Company’s large, stable core deposit base and strong capital position are the foundation for the Company’s liquidity position. The Company uses a variety of resources to meet its liquidity needs, which include deposits, cash and cash equivalents, short-term investments, cash flow from lending and investing activities, repurchase agreements, and borrowings. The Company’s Asset/Liability Management Committee monitors asset and liability positions of the Company’s subsidiary bank individually and on a combined basis. The Committee reviews periodic reports on liquidity and interest rate sensitivity positions. Comparisons with industry and peer groups are also monitored. The Company’s strong reputation in the communities it serves, along with its strong financial condition, provides access to numerous sources of liquidity as described below. Management believes these diverse liquidity sources provide sufficient means to meet all demands on the Company’s liquidity that are reasonably likely to occur. Management measures liquidity, including the level of cash, unencumbered securities, and the availability of dependable borrowing sources. The Board has set a policy limit stating that reliable sources of liquidity should remain in excess of 6% of total assets. The ratio was 16.1% at March 31, 2026 and 16.2% at December 31, 2025. In addition, the Company maintains access to the Federal Reserve Bank borrowing facility, which improved the reliable sources of liquidity ratio by an additional 2.8% at March 31, 2026, and 2.9% at December 31, 2025, to 18.9% and 19.1%, respectively. The Company also maintains board policy limits requiring that on-balance sheet liquidity, which includes liquid assets including cash, overnight funds sold, short-term investments, fair value of encumbered investment securities, and the guaranteed portion of government and agency loans, remain above 3% of total assets. As of March 31, 2026, this ratio was 9.6%.

Core deposits, discussed above under "Deposits and Other Liabilities", are a primary and low-cost funding source obtained primarily through the Company’s branch network. In addition to core deposits, the Company uses non-core funding sources to support asset growth. These non-core funding sources include time deposits of $250,000 or more, brokered deposits, municipal money market deposits, reciprocal deposits, bank borrowings, securities sold under agreements to repurchase, overnight and term advances from the FHLB, and other funding sources. Rates and terms are the primary determinants of the mix of these funding sources. Non-core funding sources of $2.1 billion at March 31, 2026 increased $38.4 million or 1.8% as compared to

year end 2025. Non-core funding sources, as a percentage of total liabilities, were 27.3% at March 31, 2026, compared to 26.9% at December 31, 2025.

Non-core funding sources may require securities to be pledged against the underlying liability. Securities carried at $1.0 billion at March 31, 2026, and $887.5 million at December 31, 2025, were either pledged or sold under agreements to repurchase. Pledged securities represented 60.6% of total securities at March 31, 2026, compared to 52.1% of total securities at December 31, 2025.

Cash and cash equivalents totaled $171.4 million as of March 31, 2026 which increased from $132.8 million at December 31, 2025. Short-term investments, consisting of securities due in one year or less, decreased from $74.1 million at December 31, 2025 to $62.6 million at March 31, 2026.

Cash flow from the loan and investment portfolios provides a significant source of liquidity. These assets may have stated maturities in excess of one year, but have monthly principal reductions. Total mortgage-backed securities, at fair value, were $927.6 million at March 31, 2026 compared with $901.1 million at December 31, 2025. Outstanding principal balances of residential mortgage loans, consumer loans, and leases totaled approximately $1.7 billion at March 31, 2026, unchanged compared with December 31, 2025. Aggregate amortization from monthly payments on these assets provides significant additional cash flow to the Company.

Liquidity is enhanced by ready access to national and regional wholesale funding sources including Federal funds purchased, repurchase agreements, brokered certificates of deposit, and FHLB advances. Through its subsidiary bank, the Company has borrowing relationships with the FHLB and correspondent banks, which provide secured and unsecured borrowing capacity. As members of the FHLB, the Company’s subsidiary banks can use certain unencumbered mortgage-related assets and securities to secure additional borrowings from the FHLB. At March 31, 2026 the established borrowing capacity with the FHLB was $1.3 billion, or 14.8% of total assets, with available unencumbered mortgage-related assets of $564.7 million. In addition to the $449.4 million of FHLB borrowings outstanding at March 31, 2026 the Company had utilized $270.0 million of availability at March 31, 2026, to collateralize municipal deposits through several standby letters of credit with the FHLB. Additional assets may also qualify as collateral for FHLB advances upon approval of the FHLB.

Through various programs at the Federal Reserve Bank, the Company has the ability to use certain unencumbered loans and securities to secure borrowings from the Federal Reserve Bank's Discount Window. At March 31, 2026 the available borrowing capacity with the Federal Reserve Bank was $245.9 million, secured by commercial and mortgage-related loans. In addition to the available borrowing lines at the FHLB and Federal Reserve Bank, the Company maintains $653.0 million of unencumbered securities which could be pledged to further enhance secured borrowing capacity.

Non-GAAP Disclosures

The following tables include disclosure of non-GAAP financial measures. The first table shows a reconciliation of tangible book value per share (non-GAAP) to common equity book value per share (GAAP). Tangible common equity, a non-GAAP financial measure, is total stockholders' equity less intangible assets. Tangible book value per share is tangible equity divided by total shares issued and outstanding. These measures adjust common equity per share to exclude the effects of goodwill and intangible amortization expense on earnings, equity, and capital. The second table summarizes the Company’s results of operations on a GAAP basis and on an operating (non-GAAP) basis for the periods indicated. The non-GAAP financial measures adjust GAAP measures to exclude the effects of non-operating items, such as the effects of the sales of available-for-sale debt securities, and significant nonrecurring income or expense on earnings, equity, and capital.

The Company believes the non-GAAP measures provide meaningful comparisons of our underlying operational performance and facilitate management's and investors' assessments of business and performance trends in comparison to others in the financial services industry. These non-GAAP financial measures should not be considered in isolation or as a measure of the Company's profitability or liquidity; they should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance with GAAP. The non-GAAP financial measures presented herein may be different from non-GAAP financial measures used by other companies, and may not be comparable to similarly titled measures reported by other companies. Further, the Company may utilize other measures to illustrate performance in the future. Non-GAAP financial measures have limitations since they do not reflect all of the amounts associated with the Company's results of operations as determined in accordance with GAAP.

Reconciliation of Tangible Book Value Per Share (non-GAAP) to Common Equity Book Value Per Share (GAAP)
Quarter-Ended Year-ended
(In thousands, except share and per share data) 03/31/2026 12/31/2025
Total common equity (GAAP) $ 946,741 $ 938,377
Less: Goodwill and intangibles 72,766 72,766
Tangible common equity (Non-GAAP) 873,975 865,611
Ending shares outstanding 14,392,337 14,420,495
Common equity book value per share (GAAP) $ 65.78 $ 65.07
Tangible book value per share (Non-GAAP) $ 60.73 $ 60.03
Reconciliation of Operating or Adjusted Net Income Available to Common Shareholders/Operating or Adjusted Diluted Earnings Per Share (Non-GAAP) to Net Income Available to Common Shareholders/Diluted Earnings Per Share (GAAP); Operating or Adjusted Return on Average Assets, Operating or Adjusted Return on Average Equity and Operating or Adjusted Return on Average Shareholders' Tangible Common Equity (Non-GAAP) to Return on Average Assets and Return on Average Equity (GAAP)
--- --- --- --- --- --- --- --- --- ---
QTD QTD QTD
(In thousands, except per share data) 03/31/2026 12/31/2025 03/31/2025
Net income available to common shareholders $ 26,074 $ 96,248 $ 19,679
Less: income attributable to unvested stock-based compensation awards 0 0 0
Net earnings allocated to common shareholders (GAAP) 26,074 96,248 19,679
Diluted earnings per share (GAAP) 1.82 6.70 1.37
Adjustments for non-operating income and expense:
(Gain) loss on sale of investment securities 0 78,721 0
(Gain) from sale of Tompkins Insurance Agencies, Inc. 0 (183,902) 0
Total adjustments 0 (105,181) 0
Tax expense 0 (34,509) 0
Total adjustments, net of tax 0 (70,672) 0
Operating or adjusted net income (Non-GAAP) 26,074 25,576 19,679
Weighted average shares outstanding (basic) 14,250,969 14,270,206 14,246,140
Weighted average shares outstanding (diluted) 14,347,514 14,356,680 14,319,440
Operating or adjusted basic earnings per share (Non-GAAP) 1.83 1.79 1.38
Operating or adjusted diluted earnings per share (Non-GAAP) 1.82 1.78 1.37
Net income available to common shareholders 26,074 96,248 19,679
Operating or adjusted net income (Non-GAAP) 26,074 25,576 19,679
Average total assets 8,581,323 8,372,287 8,056,578
Return on average assets (GAAP) 1.23 % 4.56 % 0.99 %
Operating or adjusted return on average assets (Non-GAAP) 1.23 % 1.21 % 0.99 %
Net income available to common shareholders 26,074 96,248 19,679
Operating or adjusted net income (Non-GAAP) 26,074 25,576 19,679
Average total equity 951,393 875,658 728,110
Return on average equity (GAAP) 11.11 % 43.61 % 10.96 %
Operating or adjusted return on average equity (Non-GAAP) 11.11 % 11.59 % 10.96 %
Operating or adjusted net income (Non-GAAP) 26,074 25,576 19,679
Average Tompkins Financial Corporation shareholders' equity 951,393 875,658 728,110
Amortization of intangibles 0 27 0
Tax expense 0 6 0
Amortization of intangibles, net of tax 0 21 0
Operating or adjusted net income (Non-GAAP) 26,074 25,597 19,679
Average Tompkins Financial Corporation shareholders' equity 951,393 875,658 728,110
Average goodwill and intangibles 72,766 79,494 93,637
Average Tompkins Financial Corporation shareholders' tangible common equity (Non-GAAP) $ 878,627 $ 796,164 $ 634,473
Operating or adjusted return on average shareholders' tangible common equity (Non-GAAP) 12.04 % 12.76 % 12.58 %

Item 3. Quantitative and Qualitative Disclosure About Market Risk

Interest rate risk is the primary market risk category associated with the Company's operations. Interest rate risk refers to the volatility of earnings caused by changes in interest rates. The Company manages interest rate risk using income simulation to measure interest rate risk inherent in its on-balance sheet and off-balance sheet financial instruments at a given point in time. The simulation models are used to estimate the potential effect of interest rate shifts on net interest income for future periods. Each quarter the Company's Asset/Liability Management Committee reviews the simulation results to determine whether the exposure of net interest income to changes in interest rates remains within Board-approved levels. The Committee also considers strategies to manage this exposure and incorporates these strategies into the investment and funding decisions of the Company. The Company uses derivatives to manage various risks and to accommodate the business requirements of its customers. Additional information on derivatives is available in "Note 11 Derivatives and Hedging Activities" in the Notes to Unaudited Consolidated Financial Statements in Part I, "Financial Statements" of this Report on Form 10-Q.

The Company's Board of Directors has set a policy that interest rate risk exposure will remain within a range whereby net interest income will not decline by more than 10% in one year as a result of a 200 basis point parallel change in rates over a one-year time frame. Based upon the most recent simulation analysis performed as of February 28, 2026, a 200 basis point parallel upward change in interest rates over a one-year time frame would result in a one-year decrease in net interest income from the base case of approximately 1.7%, while a 200 basis point parallel decline in interest rates over a one-year period would result in a one year increase in net interest income of 0.9% from the base case. This simulation assumes no balance sheet growth, no changes in balance sheet mix, deposit rates move in a manner that reflects the historical relationship between deposit rate movement and changes in Federal funds rate, and no management action to address balance sheet mismatches.

The decrease in net interest income in the rising rate scenario is a result of the balance sheet showing a slightly more liability sensitive position over a one year time horizon. As such, in a rising rate scenario, in the short-term, net interest income would be expected to trend slightly below the base assumption, as upward adjustments to rate sensitive deposits and short-term funding outpace increases to asset yields which are concentrated in intermediate to longer-term products. As intermediate and longer- term assets continue to reprice/adjust into a higher rate environment and funding costs stabilize, the simulation shows net interest income would be expected to trend upwards.

The 200 basis point decline scenario increases net interest income slightly in the first year as a result of the Company's assets repricing downward to a lesser degree than the rates on the Company's interest-bearing liabilities, mainly deposits and overnight borrowings. The model assumes that prepayments accelerate in the down interest rate environment resulting in additional pressure on asset yields as proceeds are reinvested at lower rates.

The most recent simulation of a base case scenario, which in addition to the above assumptions, also assumes interest rates remain unchanged from the date of the simulation, reflects a net interest margin that is increasing over the next 12 months.

Although the simulation model is useful in identifying potential exposure to interest rate movements, actual results may differ from those modeled as the repricing, maturity, balance sheet mix, and prepayment characteristics of financial instruments may change to a different degree than modeled. In addition, the model does not reflect actions that management may employ to manage the Company's interest rate risk exposure. The Company's current liquidity profile, capital position, and growth prospects offer a level of flexibility for management to take actions that could offset some of the negative effects of unfavorable movements in interest rates. Management believes the current exposure to changes in interest rates is not significant in relation to the earnings and capital strength of the Company.

In addition to the simulation analysis, management assesses the Company's exposure to changes in interest rates using an interest rate gap measure. The table below is a Condensed Static Gap Report, which illustrates the anticipated repricing intervals of assets and liabilities as of March 31, 2026. The Company’s one-year net interest rate gap was a positive $9.1 million or 0.10% of total assets at March 31, 2026, compared with a negative $106.9 million or negative 1.23% of total assets at December 31, 2025. A positive gap position exists when the amount of interest-bearing assets maturing or repricing exceeds the amount of interest-earning liabilities maturing or repricing within a particular time period. This analysis demonstrates that the timing of repricing of the Company's interest-earning assets and interest-bearing liabilities over the next 12 months is relatively similar, suggesting net interest income contains a minimal degree of risk of decline in either a rising or falling rate environment over the next 12 months. An interest rate gap measure could be significantly affected by external factors such as a rise or decline in interest rates, loan or securities prepayments, and deposit withdrawals.

Condensed Static Gap - March 31, 2026 Repricing Interval
(In thousands) Total 0-3 months 3-6 months 6-12 months Cumulative 12 months
Interest-earning assets1 $ 8,329,026 $ 2,082,084 $ 382,554 $ 718,409 $ 3,183,047
Interest-bearing liabilities 5,749,965 2,456,069 446,551 271,370 3,173,990
Net gap position (373,985) (63,997) 447,039 9,057
Net gap position as a percentage of total assets (4.30) % (0.74) % 5.14 % 0.10 %

1 Balances of available securities are shown at amortized cost

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) as of March 31, 2026.

Based upon that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this Report on Form 10-Q, the Company’s disclosure controls and procedures were effective.

Changes in Internal Control Over Financial Reporting

There were no changes in the Company's internal control over financial reporting that occurred during the quarter ended March 31, 2026, that 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

The Company is subject to various claims and legal actions that arise in the ordinary course of conducting business. As of March 31, 2026, management, after consultation with legal counsel, does not anticipate that the aggregate ultimate liability arising out of litigation pending or threatened against the Company or its subsidiaries will be material to the Company's consolidated financial position. On at least a quarterly basis, the Company assesses its liabilities and contingencies in connection with such legal proceedings. Although the Company does not believe that the outcome of pending litigation will be material to the Company's consolidated financial position, it cannot rule out the possibility that such outcomes will be material to the consolidated results of operations for a particular reporting period in the future.

Item 1A. Risk Factors

There have been no material changes in the risk factors previously disclosed under Item 1A. of the Company’s Annual Report on Form 10-K, for the fiscal year ended December 31, 2025.

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

Issuer Purchases of Equity Securities

Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
(a) (b) (c) (d)
January 1, 2026 through January 31, 2026 4,733 $ 73.45 3,000 374,661
February 1, 2026 through February 28, 2026 499 80.24 0 374,661
March 1, 2026 through March 31, 2026 20,731 76.89 20,731 353,930
Total 25,963 $ 76.33 23,731 353,930

Included above are 1,733 shares purchased in January 2026, at an average cost of $72.20, and 499 shares purchased in February 2026, at an average cost of $80.24, at the direction of the trustee of the rabbi trust established by the Company under the Amended and Restated Retainer Plan for Eligible Directors of Tompkins Financial Corporation and Participating Subsidiaries (the "Retainer Plan"), for eligible directors who elected to receive deferred stock compensation under such plan.

On July 24, 2025, the Company’s Board of Directors authorized a share repurchase plan (the “2025 Repurchase Plan”) under which the Company may repurchase up to 400,000 shares of the Company’s common stock over the 24 months following adoption of the plan. Shares may be repurchased from time to time under the 2025 Repurchase Plan in open market transactions at prevailing market prices, in privately negotiated transactions, or by other means in accordance with federal securities laws. The Company has no obligation to repurchase any shares and may discontinue repurchases at any time. As of March 31, 2026, 46,070 shares had been repurchased under the 2025 Repurchase Plan at an average price of $75.25.

Recent Sales of Unregistered Securities

On January 5, 2026, we issued an aggregate of 714 shares of our common stock to non-employee members of our Board of Directors who elected to receive all or a portion of their quarterly director retainer fees in Company stock pursuant to the Retainer Plan. These shares were valued at $72.20, which was the price at which shares of common stock were purchased on the open market for directors who elected to receive deferred stock under the Retainer Plan. The aggregate value of the shares issued was $51,550.80. The shares were issued to our non-employee directors in private transactions exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended.

Item 3. Defaults Upon Senior Securities

None

Item 4. Mine Safety Disclosures

Not applicable

Item 5. Other Information

None

Item 6. Exhibits

EXHIBIT INDEX

Exhibit Number Description
3.1 Amended and Restated Certificate of Incorporation of the Company, incorporated herein by reference to Exhibit 3(i) to the Company’s Form 10-Q, filed with the Commission on August 11, 2008.
3.2 Second Amended and Restated Bylaws of the Company, incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed with the Commission on January 31, 2011.
31.1 Certification of Principal Executive Officer as required by Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.
31.2 Certification of Principal Financial Officer as required by Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.
32.1 Certification of Principal Executive Officer as required by Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended, 18 U.S.C. Section 1350
32.2 Certification of Principal Financial Officer as required by Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended, 18 U.S.C. Section 1350
101 INS** 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 - the cover page interactive data file does not appear in the interactive date file because its XBRL tags are embedded with the inline XBRL document.

** Attached as Exhibit 101 to this report are the following formatted in Inline XBRL (eXtensible Business Reporting Language): (i) Consolidated Statements of Condition as of March 31, 2026 and December 31, 2025; (ii) Consolidated Statements of Income for the three months ended March 31, 2026 and 2025; (iii) Consolidated Statements of Comprehensive Income for the three months ended March 31, 2026 and 2025; (iv) Consolidated Statements of Cash Flows for the three months ended March 31, 2026 and 2025; (v) Consolidated Statements of Changes in Shareholders' Equity for the three months ended March 31, 2026 and 2025; and (vi) Notes to Unaudited Consolidated Financial Statements.

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.

Date:     May 5, 2026

TOMPKINS FINANCIAL CORPORATION

By: /s/ Stephen S. Romaine
Stephen S. Romaine
President and Chief Executive Officer
(Principal Executive Officer) By: /s/ Matthew D. Tomazin
--- ---
Matthew D. Tomazin
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)

54

Document

Exhibit 31.1

CERTIFICATION

I, Stephen S. Romaine, certify that:

  1. I have reviewed this quarterly report on Form 10-Q of Tompkins Financial Corporation;

  2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

  3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

  4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

  1. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 05, 2026
/s/ Stephen S. Romaine
Stephen S. Romaine
President and Chief Executive Officer
(Principal Executive Officer)

Document

Exhibit 31.2

CERTIFICATION

I,  Matthew D. Tomazin, certify that:

  1. I have reviewed this quarterly report on Form 10-Q of Tompkins Financial Corporation;

  2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

  3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

  4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

  1. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 05, 2026
/s/ Matthew D. Tomazin
Matthew D. Tomazin
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)

Document

Exhibit 32.1

CERTIFICATION

In connection with the filing of the Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2026 (the “Report”) by Tompkins Financial Corporation (the “Company”), the undersigned, as the Chief Executive Officer of the Company, hereby certifies pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

The Report fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934; and

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

May 05, 2026
/s/ Stephen S. Romaine
Stephen S. Romaine
President and Chief Executive Officer
(Principal Executive Officer)

Document

Exhibit 32.2

CERTIFICATION

In connection with the filing of the Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2026 (the “Report”) by Tompkins Financial Corporation (the “Company”), the undersigned, as the Chief Financial Officer of the Company, hereby certifies pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

The Report fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934; and

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

May 05, 2026
/s/ Matthew D. Tomazin
Matthew D. Tomazin
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)

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