Orrstown Financial Services (ORRF) investor relations material

Executive summary

• Net income for Q2 2026 was $21.2 million, or $1.09 per diluted share, reflecting an 8.8% year-over-year increase in net income and 8.3% growth in EPS, with robust returns on average assets (1.53%) and equity (13.96%).

• Net interest margin was 3.87%, or 4.00% excluding a $1.6 million one-time charge from subordinated debt redemption.

• Fee income contributed 22.1% of total operating income, with record wealth management income of $5.9 million.

• Board declared a quarterly dividend of $0.30 per share, payable August 11, 2026.

• Credit quality remained strong, with non-accrual and classified loans both decreasing due to repayments.

Financial highlights

• Net interest income for Q2 2026 was $48.8 million, slightly down from Q1 due to subordinated note redemption.

• Fee income was $13.8 million, down from Q1 due to lower life insurance proceeds.

• Noninterest expenses rose to $37.7 million, mainly due to merit increases and healthcare costs.

• Efficiency ratio was 60.1% (58.6% adjusted) in Q2 2026.

• Allowance for credit losses on loans was $46.6 million, or 1.13% of total loans.

Outlook and guidance

• Net interest margin guidance for 2026 remains 3.90%-4.00%, expected at the higher end on an adjusted basis.

• Loan growth guidance for 2026 is 5.0% annualized, with a strong pipeline.

• Noninterest income projected at $53.0–$55.0 million annualized; noninterest expenses at $148.0–$151.0 million annualized.

• Expenses anticipated to fall at the lower end of prior guidance for the full year.

• Effective tax rate guidance is approximately 21%.