Burke & Herbert Financial Services Corp. Announces Third Quarter 2025 Results and Declares Common Stock Dividend

ALEXANDRIA, Va., Oct. 23, 2025 /PRNewswire/ -- Burke & Herbert Financial Services Corp. (the "Company" or "Burke & Herbert") (Nasdaq: BHRB) reported financial results for the quarter year ended September 30, 2025, and disclosed that, at its meeting on October 23, 2025, the board of directors declared a $0.55 per share regular cash dividend to be paid on December 1, 2025, to shareholders of record as of the close of business on November 14, 2025.

Q3 2025 Highlights

From David P. Boyle, Company Chair and Chief Executive Officer

"Our solid results reflect the teamwork in executing our strategy to be trusted advisors to our customers and to expand into attractive markets where we deliver our full suite of products and services. Our loan originations were strong, and we increased our deposits during the quarter. We recently opened our first branch in Bethesda, Maryland and our newer markets in Virginia, including Fredericksburg and Richmond, are exceeding our expectations. Our balance sheet remains well positioned with ample liquidity, solid capital ratios, and adequate loss reserves. We are looking forward to a strong close to 2025 and delivering increased value for our customers, employees, communities, and shareholders."

Results of Operations

Third Quarter 2025 compared to Second Quarter 2025

The Company reported third quarter 2025 net income applicable to common shares of $29.7 million, or $1.97 per diluted common share, compared to second quarter 2025 net income applicable to common shares of $29.7 million, or $1.97 per diluted common share.

Regulatory capital ratios 2

The Company continues to be well-capitalized with capital ratios that are above regulatory requirements. As of September 30, 2025, our Common Equity Tier 1 capital to risk-weighted asset and Total risk-based capital to risk-weighted asset ratios were 12.7% 2 and 15.4% 2, respectively, and significantly above the well-capitalized requirements of 6.5% and 10%, respectively. The leverage ratio was 10.7% 2 compared to a 5% level to be considered well-capitalized.

Burke & Herbert Bank & Trust Company ("the Bank"), the Company's wholly-owned bank subsidiary, also continues to be well-capitalized with capital ratios that are above regulatory requirements. As of September 30, 2025, the Bank's Common Equity Tier 1 capital to risk-weighted asset and Total risk-based capital to risk-weighted asset ratios were 14.0% 2 and 15.2%, 2 respectively, and significantly above the well-capitalized requirements. In addition, the Bank's leverage ratio of 11.4% 2 is considered to be well-capitalized.

For more information about the Company's financial condition, including additional disclosures pertinent to recent events in the banking industry, please see our financial statements and supplemental information attached to this release.

About Burke & Herbert

Burke & Herbert Financial Services Corp. is the financial holding company for Burke & Herbert Bank & Trust Company. Burke & Herbert Bank & Trust Company is the oldest continuously operating bank under its original name headquartered in the greater Washington, D.C. metropolitan area. With over 75 branches across Delaware, Kentucky, Maryland, Virginia, and West Virginia, Burke & Herbert Bank & Trust Company offers a full range of business and personal financial solutions designed to meet customers' banking, borrowing, and investment needs. Learn more at investor.burkeandherbertbank.com.

Cautionary Note Regarding Forward-Looking Statements

This communication contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the beliefs, goals, intentions, and expectations of the Company regarding revenues, earnings, earnings per share, loan production, asset quality, and capital levels, among other matters; our estimates of future costs and benefits of the actions we may take; our assessments of expected losses on loans; our assessments of interest rate and other market risks; our ability to achieve our financial and other strategic goals; and other statements that are not historical facts.

Forward–looking statements are typically identified by such words as "believe," "expect," "anticipate," "intend," "outlook," "estimate," "forecast," "project," "will," "should," and other similar words and expressions, and are subject to numerous assumptions, risks, and uncertainties, which change over time. Additionally, forward–looking statements speak only as of the date they are made; the Company does not assume any duty, does not undertake, and specifically disclaims any obligation to update such forward–looking statements, whether written or oral, that may be made from time to time, whether because of new information, future events, or otherwise, except as required by law. Furthermore, because forward–looking statements are subject to assumptions and uncertainties, actual results or future events could differ, possibly materially, from those indicated in or implied by such forward-looking statements because of a variety of factors, many of which are beyond the control of the Company. Further, factors identified herein are not necessarily all of the factors that could cause the Company's actual results, performance or achievements to differ materially from those expressed in or implied by any of the forward-looking statements. Other factors, including unknown or unpredictable factors, also could harm the Company. Accordingly, you should consider all of these risks, uncertainties and other factors carefully in evaluating all such forward-looking statements made by the Company and not place undue reliance on forward-looking statements.

The risks and uncertainties that could cause actual results to differ from those described in the forward-looking statements include, but are not limited to, the following: costs or difficulties associated with newly developed or acquired operations; changes in general economic, political, or market trends (either nationally or locally in the areas in which we conduct, or will conduct, business), including inflation, changes in interest rates, market volatility and monetary fluctuations, and changes in federal government policies and practices, as well as the impact from recently announced and future tariffs on the markets we serve; increased competition; changes in consumer confidence and demand for financial services, including changes in consumer borrowing, repayment, investment, and deposit practices; changes in asset quality and credit risk; our ability to control costs and expenses; adverse developments in borrower industries or declines in real estate values; changes in and compliance with federal and state laws and regulations that pertain to our business and capital levels; our ability to raise capital as needed; the impact, extent and timing of technological changes; the effects of any cybersecurity breaches; and the other factors discussed in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" section of the Company's Annual Report on Form 10–K for the year ended December 31, 2024, the Company's Quarterly Reports on Form 10-Q for the quarters ended March 31, 2025, June 30, 2025, and other reports the Company files with the SEC.

Burke & Herbert Financial Services Corp.

Consolidated Statements of Income (unaudited)

(In thousands)

Three Months Ended

Nine Months Ended

September 30,

June 30

September 30,

2025

2024

2025

2024

Interest income

Taxable loans, including fees

$ 95,132

$ 103,682

$ 96,803

$ 288,966

$ 213,400

Tax-exempt loans, including fees

136

Taxable securities

9,062

10,076

9,303

27,852

29,949

Tax-exempt securities

4,863

3,135

3,939

12,069

7,052

Other interest income

2,105

1,585

1,770

4,830

2,886

Total interest income

111,209

118,526

111,858

333,853

253,368

Interest expense

Deposits

30,286

39,441

30,431

92,568

82,745

Short-term borrowings

4,379

3,080

4,438

12,009

10,806

Subordinated debt

2,748

2,798

2,730

8,207

4,658

Other interest expense

Total interest expense

37,439

45,347

37,625

112,863

98,293

Net interest income

73,770

73,179

74,233

220,990

155,075

Credit loss expense - loans and available-for-

sale securities

574

717

2,191

19,515

Credit loss (recapture) - off-balance sheet credit

exposures

(312)

(93)

(804)

3,872

Total provision for credit losses

262

147

624

1,387

23,387

Net interest income after credit loss expense

73,508

73,032

73,609

219,603

131,688

Non-interest income

Fiduciary and wealth management

2,664

2,352

2,425

7,532

5,982

Service charges and fees

2,070

2,509

2,036

6,195

4,977

Net gains on securities

212

—

251

613

Income from company-owned life insurance

1,152

1,330

2,982

5,327

2,799

Bank debit and other card revenue

3,192

3,119

3,024

9,100

6,708

Other non-interest income

2,295

1,306

2,372

6,080

3,296

Total non-interest income

11,585

10,616

12,877

34,485

24,375

Non-interest expense

Salaries and wages

20,848

20,858

21,320

63,109

51,271

Pensions and other employee benefits

4,429

4,678

4,067

13,632

12,346

Occupancy

3,479

3,412

3,521

11,045

7,947

Equipment rentals, depreciation and maintenance

3,908

4,699

4,100

12,092

18,643

Core deposit intangible amortization

3,683

4,297

3,888

11,869

7,162

ATM, card and network expense

1,200

1,640

1,314

3,646

3,299

FDIC and other regulatory assessments

976

1,037

1,088

2,978

2,500

Other operating

9,569

10,205

10,007

28,690

33,255

Total non-interest expense

48,092

50,826

49,305

147,061

136,423

Income before income taxes

37,001

32,822

37,181

107,027

19,640

Income tax expense

7,037

5,200

7,284

19,965

3,725

Net income

29,964

27,622

29,897

87,062

15,915

Preferred stock dividends

225

675

450

Net income applicable to common shares

$ 29,739

$ 27,397

$ 29,672

$ 86,387

$ 15,465

Burke & Herbert Financial Services Corp.

Consolidated Balance Sheets

(In thousands)

September 30,

2025

December 31,

2024

(Unaudited)

(Audited)

Assets

Cash and due from banks

$ 55,224

$ 35,554

Interest-earning deposits with banks

76,489

99,760

Cash and cash equivalents

131,713

135,314

Securities available-for-sale, at fair value

1,598,407

1,432,371

Restricted stock, at cost

42,187

33,559

Loans held-for-sale, at fair value

1,303

2,331

Loans

5,559,479

5,672,236

Allowance for credit losses

(67,604)

(68,040)

Net loans

5,491,875

5,604,196

Premises and equipment, net

136,117

132,270

Other real estate owned

2,742

2,783

Accrued interest receivable

35,444

34,454

Intangible assets

45,431

57,300

Goodwill

34,149

32,783

Company-owned life insurance

182,980

182,834

Other assets

186,689

161,990

Total Assets

$ 7,889,037

$ 7,812,185

Liabilities and Shareholders' Equity

Liabilities

Non-interest-bearing deposits

$ 1,358,250

$ 1,379,940

Interest-bearing deposits

5,053,802

5,135,299

Total deposits

6,412,052

6,515,239

Short-term borrowings

450,000

365,000

Subordinated debentures, net

68,906

94,872

Subordinated debentures owed to unconsolidated subsidiary trusts

17,204

17,013

Accrued interest and other liabilities

118,644

89,904

Total Liabilities

7,066,806

7,082,028

Shareholders' Equity

Preferred stock and surplus

10,413

Common stock

7,800

7,770

Common stock, additional paid-in capital

404,656

401,172

Retained earnings

495,400

434,106

Accumulated other comprehensive income (loss)

(68,454)

(95,720)

Treasury stock

(27,584)

Total Shareholders' Equity

822,231

730,157

Total Liabilities and Shareholders' Equity

$ 7,889,037

$ 7,812,185

Burke & Herbert Financial Services Corp.

Details of Net Interest Margin (unaudited)

For the three months ended

Details of Net Interest Margin - Yield Percentages

September 30

June 30

March 31

December 31

September 30

2025

2024

Interest-earning assets:

Loans:

Taxable loans

6.76 %

6.90 %

6.96 %

6.91 %

7.34 %

Tax-exempt loans

6.78

5.90

5.80

5.87

5.63

Total loans

6.76

6.90

6.96

6.91

7.34

Interest-earning deposits and

fed funds sold

4.33

4.68

5.76

4.48

3.43

Securities:

Taxable securities

3.86

3.83

3.85

3.82

4.05

Tax-exempt securities

4.17

4.20

3.85

3.55

3.58

Total securities

3.97

3.95

3.85

3.75

3.91

Total interest-earning assets

6.11 %

6.25 %

6.31 %

6.22 %

6.56 %

Interest-bearing liabilities:

Deposits:

Interest-bearing demand

2.18 %

2.21 %

2.16 %

2.51 %

3.19 %

Money market & savings

2.02

2.01

2.02

1.60

1.43

Brokered CDs & time

deposits

3.25

3.37

3.85

4.55

4.82

Total interest-bearing deposits

2.37

2.41

2.53

2.76

3.02

Borrowings:

Short-term borrowings

3.85

3.91

3.88

4.17

4.06

Subordinated debt

borrowings and other

9.49

9.62

9.85

9.87

10.16

Total interest-bearing

liabilities

2.63 %

2.68 %

2.76 %

2.98 %

3.21 %

Taxable-equivalent net

interest spread

3.48

3.57

3.55

3.24

3.35

Benefit from use of non-

interest-bearing deposits

0.60

0.63

0.67

0.72

Taxable-equivalent net

interest margin (non-GAAP 1)

4.08 %

4.17 %

4.18 %

3.91 %

4.07 %

Burke & Herbert Financial Services Corp.

Details of Net Interest Margin (unaudited)

For the three months ended

(In thousands)

Details of Net Interest Margin - Average Balances

September 30

June 30

March 31

December 31

September 30

2025

2024

Interest-earning assets:

Loans:

Taxable loans

$ 5,584,315

$ 5,627,236

$ 5,651,937

$ 5,634,157

$ 5,621,531

Tax-exempt loans

3,511

3,737

4,057

3,115

4,310

Total loans

5,587,826

5,630,973

5,655,994

5,637,272

5,625,841

Interest-earning deposits and

fed funds sold

100,445

81,369

40,757

152,537

175,265

Securities:

Taxable securities

1,034,136

1,059,310

1,039,391

1,031,024

996,749

Tax-exempt securities

586,129

476,586

435,789

452,937

440,781

Total securities

1,620,265

1,535,896

1,475,180

1,483,961

1,437,530

Total interest-earning assets

$ 7,308,536

$ 7,248,238

$ 7,171,931

$ 7,273,770

$ 7,238,636

Interest-bearing liabilities:

Deposits:

Interest-bearing demand

$ 2,278,587

$ 2,239,100

$ 2,216,243

$ 2,560,445

$ 2,144,567

Money market & savings

1,660,401

1,648,338

1,633,307

1,366,276

1,725,387

Brokered CDs & time

deposits

1,135,546

1,173,213

1,253,841

1,247,900

1,328,076

Total interest-bearing

deposits

5,074,534

5,060,651

5,103,391

5,174,621

5,198,030

Borrowings:

Short-term borrowings

453,486

457,775

336,245

325,084

304,849

Subordinated debt

borrowings and other

114,900

113,813

112,383

111,021

109,557

Total interest-bearing

liabilities

$ 5,642,920

$ 5,632,239

$ 5,552,019

$ 5,610,726

$ 5,612,436

Non-interest-bearing deposits

$ 1,338,188

$ 1,352,785

$ 1,371,615

$ 1,411,202

$ 1,389,134

Burke & Herbert Financial Services Corp.

Supplemental Information (unaudited)

As of or for the three months ended

(In thousands, except ratios and per share amounts)

September 30

June 30

March 31

December 31

September 30

2025

2024

Per common share information

Basic earnings

$ 1.98

$ 1.80

$ 1.31

$ 1.83

Diluted earnings

1.97

1.80

1.30

1.82

Cash dividends

0.55

0.53

Book value

54.02

51.28

49.90

48.08

48.63

Tangible book value

(non-GAAP 1)

48.72

45.73

44.17

42.06

42.32

Balance sheet-related (at period end, unless otherwise indicated)

Assets

$ 7,889,037

$ 8,053,084

$ 7,838,090

$ 7,812,185

$ 7,864,913

Average interest-earning

assets

7,308,536

7,248,238

7,171,931

7,273,770

7,238,636

Loans (gross)

5,559,479

5,590,457

5,647,507

5,672,236

5,574,037

Loans (net)

5,491,875

5,523,201

5,579,754

5,604,196

5,506,220

Securities, available-for-

sale, at fair value

1,598,407

1,522,611

1,436,869

1,432,371

1,436,431

Intangible assets

45,431

49,114

53,002

57,300

61,598

Goodwill

34,149

32,842

32,783

Non-interest-bearing deposits

1,358,250

1,363,617

1,382,427

1,379,940

1,392,123

Interest-bearing deposits

5,053,802

5,027,357

5,159,444

5,135,299

5,208,702

Deposits, total

6,412,052

6,390,974

6,541,871

6,515,239

6,600,825

Brokered deposits

124,386

132,098

246,902

244,802

345,328

Uninsured deposits

2,022,739

1,963,566

1,943,227

1,926,724

1,999,403

Short-term borrowings

450,000

650,000

300,000

365,000

320,163

Subordinated debt, net

86,110

114,692

113,289

111,885

110,482

Unused borrowing

capacity 3

4,153,137

4,075,313

4,082,879

4,092,378

2,353,963

Total equity

822,231

780,018

758,000

730,157

738,059

Total common equity

811,818

769,605

747,587

719,744

727,646

Accumulated other

comprehensive income

(loss)

(68,454)

(87,854)

(88,024)

(95,720)

(75,758)

Asset Quality

Provision for credit losses

$ 262

$ 624

$ 501

$ 833

$ 147

Net loan charge-offs

226

1,214

1,187

737

285

Allowance for credit

losses

67,604

67,256

67,753

68,040

67,817

Total delinquencies 4

34,722

29,056

86,223

38,213

12,486

Nonperforming loans 5

89,051

85,531

64,756

38,368

35,872

Burke & Herbert Financial Services Corp.

Supplemental Information (unaudited)

As of or for the three months ended

(In thousands, except ratios and per share amounts)

September 30

June 30

March 31

December 31

September 30

2025

2024

Income statement

Interest income

$ 111,209

$ 111,858

$ 110,786

$ 112,793

$ 118,526

Interest expense

37,439

37,625

37,799

42,083

45,347

Non-interest income

11,585

12,877

10,023

11,791

10,616

Total revenue (non-

GAAP 1)

85,355

87,110

83,010

82,501

83,795

Non-interest expense

48,092

49,305

49,664

61,410

50,826

Pretax, pre-provision

earnings (non-GAAP 1)

37,263

37,805

33,346

21,091

32,969

Provision for (recapture

of) credit losses

262

624

501

833

147

Income before income

taxes

37,001

37,181

32,845

20,258

32,822

Income tax expense

7,037

7,284

5,644

465

5,200

Net income

29,964

29,897

27,201

19,793

27,622

Preferred stock dividends

225

Net income applicable to

common shares

$ 29,739

$ 29,672

$ 26,976

$ 19,568

$ 27,397

Ratios

Return on average assets

(annualized)

1.50 %

1.51 %

1.41 %

1.00 %

1.40 %

Return on average equity

(annualized)

14.88

15.50

14.57

10.49

15.20

Net interest margin (non-

GAAP 1)

4.08

4.17

4.18

3.91

4.07

Efficiency ratio

56.34

56.60

59.83

74.44

60.66

Loan-to-deposit ratio

86.70

87.47

86.33

87.06

84.44

Consolidated Common

Equity Tier 1 (CET1)

capital ratio 2

12.73

12.22

11.77

11.53

11.40

Consolidated Total risk-

based capital ratio 2

15.37

15.27

14.79

14.57

14.45

Consolidated Leverage

ratio 2

10.71

10.42

10.12

9.80

9.66

Allowance coverage ratio

1.22

1.20

1.22

Allowance for credit

losses as a percentage of

non-performing loans

75.92

78.63

104.63

177.34

189.05

Non-performing loans as

a percentage of total

loans

1.60

1.53

1.15

0.68

0.64

Non-performing assets as

a percentage of total

assets

1.16

1.10

0.86

0.53

0.49

Net charge-offs to

average loans

(annualized)

1.6 bps

8.6 bps

8.5 bps

5.2 bps

2.0 bps

Burke & Herbert Financial Services Corp.

Non-GAAP Reconciliations (unaudited)

(In thousands, except ratios and per share amounts)

Operating net income, adjusted diluted EPS, and adjusted non-interest expense (non-GAAP 1 )

For the three months ended

September 30

June 30

March 31

December 31

September 30

2025

2024

Net income applicable to

common shares

$ 29,739

$ 29,672

$ 26,976

$ 19,568

$ 27,397

Add back significant items

(tax effected):

Merger-related

—

7,069

2,449

Total significant items

—

7,069

2,449

Operating net income

$ 29,739

$ 29,672

$ 26,976

$ 26,637

$ 29,846

Weighted average dilutive

15,112,413

15,023,807

15,026,376

15,038,442

15,040,145

Adjusted diluted EPS

$ 1.97

$ 1.80

$ 1.77

$ 1.98

Non-interest expense

$ 48,092

$ 49,305

$ 49,664

$ 61,410

$ 50,826

Remove significant items:

Merger-related

—

8,948

3,101

Total significant items

$ —

$ 8,948

$ 3,101

Adjusted non-interest

expense

$ 48,092

$ 49,305

$ 49,664

$ 52,462

$ 47,725

Operating net income is a non-GAAP measure that is derived from net income adjusted for significant items. The Company believes that operating net income is useful in periods with certain significant items such as merger-related expenses. The operating net income is more reflective of management's ability to grow the business and manage expenses. Adjusted non-interest expense also removes these significant items, such as merger-related expenses. Management believes it represents a more normalized non-interest expense total for periods with identified significant items.

Total Revenue (non-GAAP 1 )

For the three months ended

September 30

June 30

March 31

December 31

September 30

2025

2024

Interest income

$ 111,209

$ 111,858

$ 110,786

$ 112,793

$ 118,526

Interest expense

37,439

37,625

37,799

42,083

45,347

Non-interest income

11,585

12,877

10,023

11,791

10,616

Total revenue (non-

GAAP 1)

$ 85,355

$ 87,110

$ 83,010

$ 82,501

$ 83,795

Total revenue is a non-GAAP measure and is derived from total interest income less total interest expense plus total non-interest income. We believe that total revenue is a useful tool to determine how the Company is managing its business and demonstrates how stable our revenue sources are from period to period.

Burke & Herbert Financial Services Corp.

Non-GAAP Reconciliations (unaudited)

(In thousands, except ratios and per share amounts)

Pretax, Pre-Provision Earnings (non-GAAP 1 )

For the three months ended

September 30

June 30

March 31

December 31

September 30

2025

2024

Income before taxes

$ 37,001

$ 37,181

$ 32,845

$ 20,258

$ 32,822

Provision for (recapture of)

credit losses

262

624

501

833

147

Pretax, pre-

provision earnings

(non-GAAP 1)

$ 37,263

$ 37,805

$ 33,346

$ 21,091

$ 32,969

Pretax, pre-provision earnings is a non-GAAP measure and is based on adjusting income before income taxes and to exclude provision for (recapture of) credit losses. We believe that pretax, pre-provision earnings is a useful tool to help evaluate the ability to provide for credit costs through operations and provides an additional basis to compare results between periods by isolating the impact of provision for (recapture of) credit losses, which can vary significantly between periods.

Tangible Common Equity (non-GAAP 1 )

For the three months ended

September 30

June 30

March 31

December 31

September 30

2025

2024

Common shareholders'

equity

$ 811,818

$ 769,605

$ 747,587

$ 719,744

$ 727,646

Less:

Intangible assets

45,431

49,114

53,002

57,300

61,598

Goodwill

34,149

32,842

32,783

Tangible common equity

(non-GAAP 1)

$ 732,238

$ 686,342

$ 661,743

$ 629,661

$ 633,265

Shares outstanding at end

of period

15,028,524

15,007,712

14,982,807

14,969,104

14,963,003

Tangible book value per

common share

$ 48.72

$ 45.73

$ 44.17

$ 42.06

$ 42.32

In management's view, tangible common equity measures are capital adequacy metrics that may be meaningful to the Company, as well as analysts and investors, in assessing the Company's use of equity and in facilitating comparisons with peers. These non-GAAP measures are valuable indicators of a financial institution's capital strength because they eliminate intangible assets from stockholders' equity and retain the effect of accumulated other comprehensive income/(loss) in stockholders' equity.

Burke & Herbert Financial Services Corp.

Non-GAAP Reconciliations (unaudited)

(In thousands, except ratios and per share amounts)

Net Interest Margin & Taxable-Equivalent Net Interest Income (non-GAAP 1 )

As of or for the three months ended

September 30

June 30

March 31

December 31

September 30

2025

2024

Net interest income

$ 73,770

$ 74,233

$ 72,987

$ 70,710

$ 73,179

Taxable-equivalent

adjustments

1,305

1,059

881

858

847

Net interest income

(Fully Taxable-

Equivalent - FTE)

$ 75,075

$ 75,292

$ 73,868

$ 71,568

$ 74,026

Average interest-earning

assets

$ 7,308,536

$ 7,248,238

$ 7,171,931

$ 7,273,770

$ 7,238,636

Net interest margin

(non-GAAP 1)

4.08 %

4.17 %

4.18 %

3.91 %

4.07 %

The interest income earned on certain earning assets is completely or partially exempt from federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments. To provide more meaningful comparisons of net interest income, we use net interest income on a fully taxable-equivalent (FTE) basis by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments. FTE net interest income is calculated by adding the tax benefit on certain financial interest earning assets, whose interest is tax-exempt, to total interest income then subtracting total interest expense. Management believes FTE net interest income is a standard practice in the banking industry, and when net interest income is adjusted on an FTE basis, yields on taxable, nontaxable, and partially taxable assets are comparable; however, the adjustment to an FTE basis has no impact on net income and this adjustment is not permitted under GAAP. FTE net interest income is only used for calculating FTE net interest margin, which is calculated by annualizing FTE net interest income and then dividing by the average earning assets. The tax rate used for this adjustment is 21%. Net interest income shown elsewhere in this presentation is GAAP net interest income.

(1) Non-GAAP financial measures referenced in this release are used by management to measure performance in operating the business that management believes enhances investors' ability to better understand the underlying business performance and trends related to core business activities. Reconciliations of non-GAAP operating measures to the most directly comparable GAAP financial measures are included in the non-GAAP reconciliation tables in this release. Non-GAAP measures should not be used as a substitute for the closest comparable GAAP measurements.

(2) Ratios as of September 30, 2025, are estimated.

(3) Includes Federal Home Loan Bank, Borrower-in-Custody (BIC), and correspondent bank availability.

(4) Total delinquencies represent accruing loans 30 days or more past due.

(5) Includes non-accrual loans and loans 90 days past due and still accruing.

CONTACT:

Investor Relations

703-666-3555

bhfsir@burkeandherbertbank.com

SOURCE Burke & Herbert Financial Services Corp.