Peoples Bancorp (PEBO) investor relations material

Executive summary

• Net income for Q1 2026 was $29.0 million, or $0.81 per diluted share, up from $24.3 million ($0.68/share) in Q1 2025, but down from $31.8 million ($0.89/share) in Q4 2025; EPS exceeded consensus and included minor non-core items.

• Net interest margin improved to 4.16%, up 4 bps year-over-year and sequentially, driven by lower deposit costs and higher fee-based income.

• Tangible equity to tangible assets ratio increased to 8.91%, with book value per share up 1% annualized.

• Announced agreement to acquire Citizens National Corporation for $76.6–$77 million, adding $700M in assets and 12 branches in Kentucky, expected to close in H2 2026.

• Loan growth of $13 million, with strong C&I lending offset by declines in CRE, construction, premium finance, and leases; asset quality metrics improved.

Financial highlights

• Net interest income was $90.4 million in Q1 2026, up $5.2 million year-over-year but down $0.6 million sequentially, mainly due to lower accretion income and fewer days in Q1.

• Non-interest income (excluding gains/losses) rose $0.4 million sequentially and $1.2 million year-over-year, aided by annual insurance commissions and higher lease/trust income.

• Non-interest expenses increased $0.3–$0.8 million, mainly due to higher salaries, benefits, and seasonal employee-related costs; efficiency ratio was 58.6%.

• Quarterly dividend raised to $0.42 per share, 11th consecutive annual increase, with $14.6 million paid in Q1 2026.

• Loan-to-deposit ratio improved to 88.5%.

Outlook and guidance

• Expects positive operating leverage in 2026, with NIM guidance of 4.00%–4.20% assuming one 25 bps Fed rate cut; each 25 bps move impacts NIM by 3–4 bps.

• Quarterly fee-based income projected at $28M–$30M; non-interest expense at $73M–$75M per quarter for the rest of 2026.

• Loan growth expected at the low end of 3%–5% range due to paydowns and macro environment; net charge-offs projected to decline in 2H 2026.

• Management remains focused on loan growth, efficiency, and integration of acquisitions, with ongoing emphasis on expense control and deposit management.

• The Federal Reserve's recent and potential future rate cuts may impact net interest income and margin.