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Orrstown Financial (NASDAQ: ORRF) grows Q1 2026 profit with strong capital

Filing Impact
(High)
Filing Sentiment
(Neutral)
Form Type
8-K

Rhea-AI Filing Summary

Orrstown Financial Services, Inc. reported solid first quarter 2026 results with net income of $21.8 million, up from $18.1 million a year earlier. Diluted EPS rose to $1.12 from $0.93. Return on average assets was 1.59% and return on average equity was 14.76%, both higher than a year ago.

Total loans reached $4.1 billion, increasing $40.6 million from December 31, 2025, while deposits grew $98.7 million to $4.6 billion. The tax‑equivalent net interest margin slipped to 3.90% from 4.00% in the prior quarter as loan and securities yields declined.

Noninterest income improved to $15.6 million, helped by $2.4 million of life insurance death benefits, and noninterest expenses edged down to $36.7 million. Asset quality remained stable with an allowance for credit losses of $47.5 million or 1.17% of loans and nonaccrual loans at 0.74% of total loans. Capital stayed strong, with a total risk‑based capital ratio of 13.5% and tangible common equity of 9.2%. The Board declared a quarterly cash dividend of $0.30 per common share, payable May 12, 2026 to shareholders of record on May 5, 2026.

Positive

  • Profits and EPS rose meaningfully year over year: net income increased to $21.8 million from $18.1 million, and diluted EPS rose to $1.12 from $0.93, with ROA at 1.59% and ROE at 14.76%.
  • Capital and balance sheet strengthened: total risk‑based capital improved to 13.5%, the tangible common equity ratio rose to 9.2%, deposits increased $98.7 million, and FHLB advances and other borrowings fell by $68.0 million.
  • Improved efficiency and fee income: the efficiency ratio improved to 56.9% from 63.2% a year earlier, while noninterest income grew to $15.6 million, supported by higher life insurance income and swap fees.

Negative

  • Net interest margin compressed: tax‑equivalent NIM declined to 3.90% from 4.00% in the prior quarter, as yields on loans and securities fell faster than funding costs.
  • Credit metrics showed modest pressure: net charge‑offs increased to $0.9 million, nonaccrual loans rose to 0.74% of total loans from 0.70%, and ACL coverage of nonaccruals decreased from 170% to 158%.

Insights

Orrstown posts higher profits, strong capital, slight margin pressure.

Orrstown Financial Services delivered higher profitability in Q1 2026, with net income of $21.8M versus $18.1M a year earlier and diluted EPS of $1.12. Returns remain robust, with ROA at 1.59% and ROE at 14.76%, supported by fee income and cost control.

Balance sheet trends are constructive. Loans grew $40.6M to $4.1B, while deposits rose $98.7M, allowing a $68.0M reduction in FHLB advances and other borrowings. Capital ratios strengthened, with total risk‑based capital at 13.5% and the tangible common equity ratio at 9.2%.

Key trade-offs appear in the margin and credit. The tax‑equivalent net interest margin declined to 3.90% from 4.00%, driven by lower yields on loans and securities despite modestly lower funding costs. Asset quality is generally stable: the ACL stands at $47.5M (1.17% of loans), net charge‑offs were $0.9M, and nonaccrual loans rose slightly to 0.74% of total loans, while coverage remains solid at 158%.

Item 2.02 Results of Operations and Financial Condition Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 7.01 Regulation FD Disclosure Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 9.01 Financial Statements and Exhibits Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Net income $21.8M Three months ended March 31, 2026
Diluted EPS $1.12 Three months ended March 31, 2026
Net interest margin 3.90% Tax-equivalent basis, Q1 2026
Total loans $4.06B Balance at March 31, 2026
Total deposits $4.63B Balance at March 31, 2026
Allowance for credit losses $47.5M (1.17% of loans) Balance at March 31, 2026
Total risk-based capital ratio 13.5% Orrstown Financial Services, March 31, 2026
Quarterly dividend $0.30/share Payable May 12, 2026
net interest margin financial
"Net interest margin, on a tax equivalent basis, was 3.90% in the first quarter of 2026"
Net interest margin measures how much a bank earns from lending and investing compared with what it pays for funding, expressed as a percentage of its interest-earning assets. Think of it like a grocery store’s markup: it shows the gap between buying cost and selling price per dollar of goods — here, the cost is interest paid and the sale is interest received. Investors watch it because a higher margin usually means a bank is more profitable and better at managing interest rate and credit conditions.
allowance for credit losses financial
"The allowance for credit losses ("ACL") on loans decreased to $47.5 million at March 31, 2026"
Allowance for credit losses is a reserve set aside by a financial institution to cover potential losses from borrowers who may not repay their loans. It acts like a safety net, helping the institution prepare for loans that might turn sour. For investors, it signals how cautious the institution is about the quality of its loans and potential risks to its financial health.
nonaccrual loans financial
"Non-accrual loans totaled $30.0 million at March 31, 2026 compared to $28.0 million"
Nonaccrual loans are loans a lender has stopped counting toward interest income because the borrower is overdue or unlikely to pay; the lender only records cash payments received and may set aside extra funds to cover potential losses. For investors, a rising number or amount of nonaccrual loans signals weaker credit quality, lower future interest revenue and larger potential write-downs — similar to pausing expected subscription income when many customers stop paying.
tangible common equity ratio financial
"The Company's tangible common equity ratio was 9.2% at March 31, 2026"
Tangible common equity ratio measures how much real, loss-absorbing capital common shareholders have relative to a company's tangible assets—calculated by removing intangible items (like goodwill) and preferred equity from total equity and comparing that net amount to tangible assets. Think of it as the thickness of a safety cushion made of solid, visible value rather than accounting entries; investors use it to judge how well a company could withstand losses and protect common shareholders' claims.
efficiency ratio financial
"Efficiency ratio | 56.9 % | | 63.2 %"
A measure of how much a company spends to produce each dollar of revenue, usually shown as operating expenses divided by revenue and expressed as a percentage. Think of it as a household’s budget: a lower percentage means more of each dollar earned stays as profit, while a higher number means costs are eating into returns. Investors use it to judge cost control and compare how efficiently companies turn revenue into earnings, especially in banks and financial firms.
risk-based capital ratio financial
"The Company's tier 1 common equity, tier 1 capital and total risk-based capital ratios were 11.8%, 12.0% and 13.5%"
A risk-based capital ratio compares a financial firm's capital (the cushion of money it can lose without collapsing) to its assets after those assets are scaled up or down based on how risky they are. Think of it like measuring how strong a boat's lifeboats are relative to how stormy the water is—higher ratios mean a bigger safety buffer. Investors use it to judge a bank or insurer's ability to survive losses and to predict regulatory pressure or limits on dividends and growth.
Net income $21.8M +20.8% YoY (vs. $18.1M)
Diluted EPS $1.12 +20.4% YoY (vs. $0.93)
Net interest margin 3.90% -0.10 pts QoQ (vs. 4.00%)
Noninterest income $15.6M +34.0% YoY (vs. $11.6M)
Understanding 8-K Material Events →
0000826154False00008261542026-04-212026-04-21

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
April 21, 2026
ORRSTOWN FINANCIAL SERVICES, INC.
(Exact name of registrant as specified in its charter)
Pennsylvania001-3429223-2530374
(State or other jurisdiction of incorporation)(Commission File Number)(IRS Employer Identification No.)
4750 Lindle Road,Harrisburg,Pennsylvania17111
(Address of Principal Executive Offices)(Zip Code)
Registrant’s Telephone Number, Including Area Code:(717)532-6114
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)).
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbol(s)Name of each exchange on which registered
Common Stock, no par valueORRFNasdaq Stock Market
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
☐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 the Exchange Act.



Item 2.02    Results of Operations and Financial Condition
On April 21, 2026, Orrstown Financial Services, Inc. (the “Company”) issued a press release to report earnings for the quarter ended March 31, 2026.
A copy of the press release is furnished with this Form 8-K as Exhibit 99.1, and is incorporated herein in its entirety by reference.
Item 7.01    Regulation FD
In connection with the press release announcing the Company’s quarterly earnings, the Company posted an investor presentation to its website at www.orrstown.com. A copy of the investor presentation is furnished with this Form 8-K as Exhibit 99.2, and is incorporated herein in its entirety by reference.
The Board of Directors of the Company declared a cash dividend of $0.30 per common share, payable May 12, 2026 to shareholders of record as of May 5, 2026.
Item 9.01    Financial Statements and Exhibits
(d)    Exhibits
The following exhibit is furnished as part of this Current Report on Form 8-K:
Exhibit No.Description
99.1
Press Release dated April 21, 2026
99.2
Investor Presentation of Orrstown Financial Services, Inc. issued April 22, 2026
104Cover Page Interactive Data File (embedded within the inline XBRL document)


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 hereunto duly authorized.
ORRSTOWN FINANCIAL SERVICES, INC.
Date: April 22, 2026By:/s/ Neelesh Kalani
Neelesh Kalani
Executive Vice President and Chief Financial Officer
(Duly Authorized Representative)


Exhibit 99.1
orrflogo2019a.jpg
FOR IMMEDIATE RELEASE:                 
Orrstown Financial Services, Inc. Reports First Quarter 2026 Results

•Net income of $21.8 million, or $1.12 per diluted share, for the three months ended March 31, 2026 compared to net income of $21.5 million, or $1.11 per diluted share, for the three months ended December 31, 2025;
•Return on average assets was 1.59% and return on average equity was 14.76% for the three months ended March 31, 2026, compared to 1.55% and 14.73%, respectively, for the three months ended December 31, 2025;
•Net interest margin, on a tax equivalent basis, was 3.90% in the first quarter of 2026 compared to 4.00% in the fourth quarter of 2025;
•Total loans increased by $40.6 million, or approximately 4% annualized, from December 31, 2025 to March 31, 2026;
•Deposits increased by $98.7 million from December 31, 2025 to March 31, 2026; borrowings decreased by $68.0 million from December 31, 2025 to March 31, 2026;
•Noninterest income increased by $1.2 million from $14.4 million for the three months ended December 31, 2025 to $15.6 million for the three months ended March 31, 2026;
•Noninterest expenses decreased by $0.7 million from $37.4 million for the three months ended December 31, 2025 to $36.7 million for the three months ended March 31, 2026 due primarily to decreases in salaries and benefits expense and professional services expense;
•Tangible common equity increased to 9.2% at March 31, 2026 from 9.0% at December 31, 2025; total risk-based capital improved to 13.5% at March 31, 2026 from 13.3% at December 31, 2025;
•Tangible book value per common share(1) increased to $25.76 per share at March 31, 2026 from $25.21 per share at December 31, 2025 and
•The Board of Directors declared a cash dividend of $0.30 per common share, payable May 12, 2026, to shareholders of record as of May 5, 2026.

HARRISBURG, PA (April 21, 2026) -- Orrstown Financial Services, Inc. (the "Company") (NASDAQ: ORRF), the parent company of Orrstown Bank (the “Bank”), announced earnings for the quarter ended March 31, 2026. Net income totaled $21.8 million for the three months ended March 31, 2026, compared to net income of $21.5 million and $18.1 million for the three months ended December 31, 2025 and March 31, 2025, respectively. Diluted earnings per share was $1.12 for the three months ended March 31, 2026, compared to $1.11 and $0.93 for the three months ended December 31, 2025 and March 31, 2025, respectively. For the first quarter of 2025, excluding the impact from the previously disclosed merger-related expenses, net of taxes, net income and diluted earnings per share were $19.3 million(1) and $1.00(1), respectively.
“Orrstown delivered strong results across the board in another successful quarter,” said Thomas R. Quinn, Jr., President and Chief Executive Officer. “Net income and diluted earnings per share increased quarter to quarter. Return on average assets and return on average equity continued to exceed peer multiples. Noninterest income again was a substantial component of our earnings. Noninterest expense declined as we continue to focus on creating efficiencies throughout the organization. The loan portfolio experienced growth across the whole footprint while maintaining a focus on quality. We believe that deposit growth, which accelerated during the second half of the quarter, will enable us to successfully manage our funding costs and maintain a healthy net interest margin in a competitive funding environment. Our credit metrics remain sound and our capital ratios are consistently building from earnings generation.”
Adam Metz, Senior Executive Vice President and Chief Operating Officer added “Having spent nearly a decade at Orrstown, I have seen first-hand the strength of our franchise, the power of our culture and the collective commitment the whole organization has to our clients and community. An incredibly talented team with common alignment to our core principles will continue to build upon the foundation already in place - driving growth, deepening client relationships, thoughtfully expanding fee‑based businesses, and continuing our unwavering commitment to sound risk management and long‑term shareholder value.”
(1) Non-GAAP measure. See Appendix A for additional information.
1

DISCUSSION OF RESULTS
Balance Sheet
Loans
Loans held for investment increased by $40.6 million and totaled $4.1 billion at March 31, 2026 compared to $4.0 billion at December 31, 2025. Commercial loans increased by $31.5 million, or approximately 4% annualized, and residential mortgages increased by $10.1 million, or approximately 5% annualized, from December 31, 2025 to March 31, 2026. Loan growth was reduced by the impact of loan payoffs.
Investment Securities
Investment securities, all of which are classified as available-for-sale, decreased by $5.7 million to $947.0 million at March 31, 2026 from $952.7 million at December 31, 2025. During the three months ended March 31, 2026, paydowns totaled $23.4 million and net unrealized losses increased by $6.8 million due to higher market interest rates and widening of spreads at the end of the first quarter of 2026. The Bank purchased $23.1 million of investment securities, consisting of $15.1 million of agency mortgage backed securities and collateralized mortgage obligations, $6.9 million of non-agency collateralized mortgage obligations and $1.1 million of securities issued by state and political subdivisions during the first quarter of 2026. The remaining change in investment securities is due to net accretion recorded on the investment securities during the first quarter of 2026. The overall duration of the Company's investment securities portfolio was 4.7 years at March 31, 2026 compared to 4.6 years at December 31, 2025. See Appendix B for a summary of the Bank's investment securities at March 31, 2026, highlighting their concentrations, credit ratings and credit enhancement levels.
Deposits
During the first quarter of 2026, deposits increased by $98.7 million and totaled $4.6 billion at March 31, 2026 compared to $4.5 billion at December 31, 2025. Interest-bearing demand deposits, non-interest demand deposits, time deposits and money market deposits increased by $73.2 million, $11.7 million, $8.8 million and $7.6 million, respectively, from December 31, 2025 to March 31, 2026. Savings deposits decreased by $2.6 million from December 31, 2025 to March 31, 2026. Efforts to drive deposit generation were successful in the first quarter of 2026. The Bank's loan-to-deposit ratio was 88% at March 31, 2026 compared to 89% at December 31, 2025.
Borrowings
The Company actively manages its liquidity position through its various sources of funding to meet the needs of its clients. FHLB advances and other borrowings were $206.7 million at March 31, 2026 compared to $274.7 million at December 31, 2025. The decrease of $68.0 million was due to repayments during the first quarter of 2026 as the Bank utilized available liquidity from deposits to fund its operations. The Bank seeks to maintain sufficient liquidity to ensure that client needs can be addressed in a timely basis. The Bank had available alternative funding sources, such as FHLB advances and other wholesale options, of $1.8 billion at March 31, 2026 compared to $1.7 billion at December 31, 2025.
2

Income Statement
Net Interest Income and Margin
Net interest income was $49.0 million for the three months ended March 31, 2026 compared to $50.5 million for the three months ended December 31, 2025. A significant portion of this decrease was due to two less days in the first quarter of 2026 compared to the fourth quarter of 2025. The net interest margin, on a tax equivalent basis, decreased to 3.90% in the first quarter of 2026 from 4.00% in the fourth quarter of 2025. This decrease is primarily the result of a decrease of 13 basis points in the yield on loans and a decrease of seven basis points in the yield on securities from the three months ended December 31, 2025 to the three months ended March 31, 2026. These decreases in the yield on interest-earning assets were partially offset by a decrease of two basis points in the cost of funds between the same periods. Net interest income reflects the net accretion impact of purchase accounting marks on loans, securities, deposits and borrowings of $4.7 million during the first quarter of 2026 compared to $5.3 million for the fourth quarter of 2025.
Interest income on loans, on a tax equivalent basis, decreased by $1.4 million to $63.2 million for the three months ended March 31, 2026 compared to $64.6 million for the three months ended December 31, 2025. This decrease was primarily due to the impact of previous fed funds rate reductions on the Bank's variable rate loan portfolio. In addition, the net accretion impact of purchase accounting marks on loans was 33 basis points in the first quarter of 2026 compared to 36 basis points in the fourth quarter of 2025.
Interest income on investment securities, on a tax equivalent basis, was $11.1 million for the first quarter of 2026 compared to $11.2 million for the fourth quarter of 2025. The decrease in interest income is due to the decline in the market interest rates. Average investment securities increased by $7.1 million during the three months ended March 31, 2026 compared to the three months ended December 31, 2025 primarily due to net purchases.
Interest expense, on a tax equivalent basis, decreased by $0.3 million to $25.4 million for the three months ended March 31, 2026 compared to $25.7 million for the three months ended December 31, 2025. The cost of deposits decreased by two basis points during the three months ended March 31, 2026 compared to the three months ended December 31, 2025, and the borrowing costs from FHLB advances and other borrowings decreased by nine basis points during the three months ended March 31, 2026 compared to the three months ended December 31, 2025. This was the result of the recent reductions to FHLB borrowing rates. At the end of December 2025, the interest rate on the subordinated notes converted to a variable rate, which resulted in an increase of $0.3 million in interest expense and an increase of three basis points to the cost of interest-bearing liabilities for the first quarter of 2026. Average interest-bearing deposits increased by $54.0 million during the three months ended March 31, 2026 compared to the three months ended December 31, 2025. Average FHLB advances and other borrowings increased by $9.6 million from the three months ended December 31, 2025 to the three months ended March 31, 2026. Funding costs were elevated in the first half of the quarter due to seasonal deposit declines, which increased borrowing balances temporarily. Significant deposit inflow in the back half of the quarter enabled the Bank to significantly reduce its borrowing levels, but the average balance was still higher than the prior quarter.
Provision for Credit Losses on Loans
The allowance for credit losses ("ACL") on loans decreased to $47.5 million at March 31, 2026 from $47.7 million at December 31, 2025. The ACL to total loans was 1.17% at March 31, 2026 compared to 1.19% at December 31, 2025. The Company recorded provision expense on loans of $0.7 million for the three months ended March 31, 2026 compared to $0.1 million for the three months ended December 31, 2025. Net charge-offs were $0.9 million for the three months ended March 31, 2026 compared to $0.5 million for the three months ended December 31, 2025.
Classified loans decreased by $0.8 million to $57.6 million at March 31, 2026 from $58.4 million at December 31, 2025 due to repayments of $2.9 million and charge-offs of $0.9 million, offset by net downgrades. Non-accrual loans totaled $30.0 million at March 31, 2026 compared to $28.0 million at December 31, 2025. The increase of $2.0 million in nonaccrual loans was due to additions to nonaccrual status of $5.9 million of loans, primarily consisting of $4.2 million for one commercial and land development loan and $0.8 million in one commercial loan, partially offset by repayments totaling $2.3 million, an upgrade returning one commercial loan of $1.2 million to accruing status and net charge offs of $0.9 million. Nonaccrual loans to total loans increased to 0.74% at March 31, 2026 from 0.70% at December 31, 2025. Management believes the ACL to be adequate based on current asset quality metrics and economic forecasts.
3

Noninterest Income
Noninterest income increased by $1.2 million to $15.6 million for the three months ended March 31, 2026 from $14.4 million for the three months ended December 31, 2025.
Income from life insurance increased by $2.5 million to $3.8 million for the three months ended March 31, 2026 compared to $1.3 million for the three months ended December 31, 2025. During the first quarter of 2026, the Company recorded $2.4 million in income from life insurance policy death benefits.
Swap fee income increased by $0.2 million to $1.3 million for the three months ended March 31, 2026 compared to $1.1 million for the three months ended December 31, 2025. Swap fee income will fluctuate based on market conditions and client demand.
Wealth management income was $5.6 million for the three months ended March 31, 2026 compared to $5.7 million for the three months ended December 31, 2025, which reflects the strength of our wealth management platform despite a decline in market performance during the first quarter of 2026.
Income from service charges decreased by $0.3 million to $2.9 million for the three months ended March 31, 2026 from $3.2 million for the three months ended December 31, 2025 due to a decrease in interchange activity.
Other income decreased by $0.6 million to $0.2 million for the three months ended March 31, 2026 from $0.8 million for the three months ended December 31, 2025. The fourth quarter of 2025 includes $0.3 million in solar tax credit income and other one time credits.
Noninterest Expenses
Noninterest expenses decreased by $0.7 million to $36.7 million for the three months ended March 31, 2026 from $37.4 million in the three months ended December 31, 2025.
Salaries and benefits expense decreased by $0.8 million to $21.2 million for the three months ended March 31, 2026 compared to $22.0 million for the three months ended December 31, 2025. This was elevated during the fourth quarter of 2025 primarily due to year-end incentive accruals.
Professional services expense decreased by $0.7 million from $1.9 million for the three months ended December 31, 2025 to $1.2 million for the three months ended March 31, 2026. The decrease was due to reduced reliance on third-party assistance with internal projects.
Taxes other than income increased by $0.5 million in the three months ended March 31, 2026 compared to the three months ended December 31, 2025. This increase reflects the tax credits recognized in the fourth quarter of 2025 as a result of charitable contributions.
Income Taxes
The Company's effective tax rate was 20.7% for the first quarter of 2026 compared to 21.8% for the fourth quarter of 2025. The Company's effective tax rate for the three months ended March 31, 2026 is less than the 21% federal statutory rate primarily due to tax-exempt income, including interest earned on tax-exempt loans and securities and non-taxable income from life insurance policies and tax credits partially offset by the disallowed portion of interest expense against earnings in association with the Bank's tax-exempt investments under the Tax Equity and Fiscal Responsibility Act of 1982 ("TEFRA"). The Company regularly analyzes its projected taxable income and makes adjustments to the provision for income taxes accordingly.
Capital
Shareholders’ equity totaled $603.2 million at March 31, 2026 compared to $591.5 million at December 31, 2025. The increase of $11.7 million is primarily due to net income of $21.8 million partially offset by dividends of $5.9 million and other comprehensive losses of $4.5 million.
Tangible book value per common share(1) increased to $25.76 per share at March 31, 2026 from $25.21 per share at December 31, 2025. The Company's tangible common equity ratio was 9.2% at March 31, 2026 compared to 9.0% at December 31, 2025. Return on average tangible common equity per common share(1) was 17.96% for the three months ended March 31, 2026 compared to 18.15% for the three months ended December 31, 2025. The decrease in the return on average tangible common equity per common share was primarily due to the increase in average shareholders' equity.
(1) Non-GAAP measure. See Appendix A for additional information.
4

The Company's capital ratios increased during the three months ended March 31, 2026 compared to the three months ended December 31, 2025 due to earnings. The Company's tier 1 common equity, tier 1 capital and total risk-based capital ratios were 11.8%, 12.0% and 13.5%, respectively, at March 31, 2026 compared to 11.5%, 11.7% and 13.3%, respectively, at December 31, 2025. The Company's Tier 1 leverage ratio increased to 9.7% at March 31, 2026 compared to 9.5% at December 31, 2025.
At March 31, 2026, all four capital ratios applicable to the Company were above regulatory minimum levels to be deemed “well capitalized” under current bank regulatory guidelines. The Company continues to believe that capital is adequate to support the risks inherent in the balance sheet, as well as growth requirements.


Investor Relations Contact:
Neelesh Kalani
Executive Vice President, Chief Financial Officer
Phone (717) 510-7097

5


FINANCIAL HIGHLIGHTS (Unaudited)
Three Months Ended
March 31,March 31,
(In thousands)20262025
Profitability for the period:
Net interest income$49,005 $48,761 
Provision for (recovery of) credit losses - loans728 (554)
Recovery of credit losses - unfunded loan commitments(376)— 
Noninterest income15,577 11,624 
Noninterest expenses36,728 38,176 
Income before income tax expense27,502 22,763 
Income tax expense5,693 4,712 
Net income available to common shareholders$21,809 $18,051 
Financial ratios:
Return on average assets (1)
1.59 %1.35 %
Return on average assets, adjusted (1) (2) (3)
n/a1.45 %
Return on average equity (1)
14.76 %13.98 %
Return on average equity, adjusted (1) (2) (3)
n/a14.97 %
Net interest margin (1)
3.90 %4.00 %
Efficiency ratio56.9 %63.2 %
Efficiency ratio, adjusted (2) (3)
n/a60.5 %
Income per common share:
Basic$1.13 $0.94 
Basic, adjusted (2) (3)
n/a$1.01 
Diluted$1.12 $0.93 
Diluted, adjusted (2) (3)
n/a$1.00 
Average equity to average assets10.80 %9.65 %
(1) Annualized for the three months ended March 31, 2026 and 2025.
(2) Ratio has been adjusted for the non-recurring charges at March 31, 2025. There were no non-recurring charges for the three months ended March 31, 2026.
(3) Non-GAAP based financial measure at March 31, 2025. Please refer to Appendix A - Supplemental Reporting of Non-GAAP Measures and GAAP to Non-GAAP Reconciliations for a discussion of our use of non-GAAP based financial measures, including tables reconciling GAAP and non-GAAP financial measures appearing herein.

6

FINANCIAL HIGHLIGHTS (Unaudited)
(continued)
March 31,December 31,
(Dollars in thousands, except per share amounts)20262025
At period-end:
Total assets$5,576,972 $5,542,255 
Loans, net of allowance for credit losses4,013,856 3,973,012 
Loans held-for-sale, at fair value3,366 6,090 
Securities available for sale, at fair value947,018 952,740 
Total deposits4,627,424 4,528,774 
FHLB advances and other borrowings and Securities sold under agreements to repurchase225,958 299,243 
Subordinated notes and trust preferred debt37,274 37,122 
Shareholders' equity603,184 591,535 
Credit quality and capital ratios (1):
Allowance for credit losses to total loans1.17 %1.19 %
Total nonaccrual loans to total loans0.74 %0.70 %
Nonperforming assets to total assets0.56 %0.51 %
Allowance for credit losses to nonaccrual loans158 %170 %
Total risk-based capital:
Orrstown Financial Services, Inc.13.5 %13.3 %
Orrstown Bank13.6 %13.3 %
Tier 1 risk-based capital:
Orrstown Financial Services, Inc.12.0 %11.7 %
Orrstown Bank12.5 %12.2 %
Tier 1 common equity risk-based capital:
Orrstown Financial Services, Inc.11.8 %11.5 %
Orrstown Bank12.5 %12.2 %
Tier 1 leverage capital:
Orrstown Financial Services, Inc.9.7 %9.5 %
Orrstown Bank10.2 %9.9 %
Book value per common share$30.76 $30.32 
(1) Capital ratios are estimated for the current period, subject to regulatory filings. The Company elected the three-year phase in option for the day-one impact of ASU 2016-13 for current expected credit losses ("CECL") to regulatory capital. At December 31, 2025, the Company adjusted retained earnings, allowance for credit losses includable in tier 2 capital and the deferred tax assets from temporary differences in risk weighted assets by the permitted percentage of the day-one impact from adopting the CECL standard. At March 31, 2026, the day-one impact of ASU 2016-13 was fully applied to the capital ratios.







7

ORRSTOWN FINANCIAL SERVICES, INC.
CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollars in thousands, except per share amounts)March 31, 2026December 31, 2025
Assets
Cash and due from banks$49,014 $42,083 
Interest-bearing deposits with banks112,122 107,691 
Cash and cash equivalents161,136 149,774 
Restricted investments in bank stocks23,984 26,717 
Securities available for sale (amortized cost of $973,220 and $972,138 at March 31, 2026 and December 31, 2025, respectively)
947,018 952,740 
Loans held for sale, at fair value3,366 6,090 
Loans4,061,319 4,020,693 
Less: Allowance for credit losses(47,463)(47,681)
Net loans4,013,856 3,973,012 
Premises and equipment, net50,532 51,029 
Cash surrender value of life insurance145,964 146,994 
Goodwill69,751 69,751 
Other intangible assets, net35,751 37,990 
Accrued interest receivable21,176 21,473 
Deferred tax assets, net32,802 33,931 
Other assets71,636 72,754 
Total assets$5,576,972 $5,542,255 
Liabilities
Deposits:
Noninterest-bearing$882,588 $870,906 
Interest-bearing3,744,836 3,657,868 
Total deposits4,627,424 4,528,774 
Securities sold under agreements to repurchase and federal funds purchased19,264 24,542 
FHLB advances and other borrowings206,694 274,701 
Subordinated notes and trust preferred debt37,274 37,122 
Other liabilities83,132 85,581 
Total liabilities4,973,788 4,950,720 
Shareholders’ Equity
Preferred stock, $1.25 par value per share; 500,000 shares authorized; no shares issued or outstanding
— — 
Common stock, no par value—$0.05205 stated value per share; 50,000,000 shares authorized; 19,711,628 shares issued and 19,611,427 outstanding at March 31, 2026; 19,711,628 shares issued and 19,507,208 outstanding at December 31, 2025
1,026 1,026 
Additional paid—in capital422,663 424,596 
Retained earnings202,704 186,752 
Accumulated other comprehensive loss(19,720)(15,201)
Treasury stock— 100,201 and 204,420 shares, at cost at March 31, 2026 and December 31, 2025, respectively
(3,489)(5,638)
Total shareholders’ equity603,184 591,535 
Total liabilities and shareholders’ equity$5,576,972 $5,542,255 




8

ORRSTOWN FINANCIAL SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
Three Months Ended
March 31,March 31,
(Dollars in thousands, except per share amounts)20262025
Interest income
Loans$62,995 $63,432 
Investment securities - taxable9,851 8,944 
Investment securities - tax-exempt881 875 
Short-term investments637 2,268 
Total interest income74,364 75,519 
Interest expense
Deposits21,986 24,260 
Securities sold under agreements to repurchase and federal funds purchased97 84 
FHLB advances and other borrowings2,355 1,118 
Subordinated notes and trust preferred debt921 1,296 
Total interest expense25,359 26,758 
Net interest income49,005 48,761 
Provision for (recovery of) credit losses - loans728 (554)
Recovery of credit losses - unfunded loan commitments(376)— 
Net interest income after provision for (recovery of) credit losses48,653 49,315 
Noninterest income
Service charges2,871 2,395 
Interchange income1,513 1,427 
Swap fee income1,339 394 
Wealth management income5,557 5,415 
Mortgage banking activities326 302 
Income from life insurance3,761 1,289 
Investment securities (losses) gains(2)13 
Other income212 389 
Total noninterest income15,577 11,624 
Noninterest expenses
Salaries and employee benefits21,157 20,388 
Occupancy, furniture and equipment4,221 4,675 
Data processing1,537 924 
Advertising and bank promotions683 499 
FDIC insurance549 824 
Professional services1,221 1,826 
Taxes other than income1,025 942 
Intangible asset amortization2,239 2,535 
Merger-related expenses
— 1,649 
Restructuring expenses— 91 
Other operating expenses4,096 3,823 
Total noninterest expenses36,728 38,176 
Income before income tax expense27,502 22,763 
Income tax expense5,693 4,712 
Net income$21,809 $18,051 
continued
9

Three Months Ended
March 31,March 31,
20262025
Share information:
Basic earnings per share$1.13 $0.94 
Diluted earnings per share$1.12 $0.93 
Dividends paid per share$0.30 $0.26 
Weighted average shares - basic19,274 19,157 
Weighted average shares - diluted19,410 19,328 
10

ANALYSIS OF NET INTEREST INCOME
Average Balances and Interest Rates, Taxable-Equivalent Basis (Unaudited)
Three Months Ended
3/31/202612/31/20259/30/20256/30/20253/31/2025
Taxable-Taxable-Taxable-Taxable-Taxable-Taxable-Taxable-Taxable-Taxable-Taxable-
AverageEquivalentEquivalentAverageEquivalentEquivalentAverageEquivalentEquivalentAverageEquivalentEquivalentAverageEquivalentEquivalent
(In thousands)BalanceInterestRateBalanceInterestRateBalanceInterestRateBalanceInterestRateBalanceInterestRate
Assets
Federal funds sold & interest-bearing bank balances$70,086 $637 3.69 %$103,886 $1,017 3.88 %$101,728 $1,123 4.38 %$136,106 $1,513 4.46 %$203,347 $2,268 4.52 %
Investment securities (1)(2)
984,060 11,079 4.51 976,957 11,177 4.58 906,399 10,593 4.67 904,119 10,626 4.70 865,126 10,052 4.65 
Loans (1)(3)(4)(5)
4,070,889 63,214 6.29 3,997,842 64,635 6.42 3,979,044 65,975 6.58 3,894,978 63,246 6.52 3,909,694 63,641 6.59 
Total interest-earning assets5,125,035 74,930 5.91 5,078,685 76,829 6.01 4,987,171 77,691 6.19 4,935,203 75,385 6.13 4,978,167 75,961 6.17 
Other assets423,779 426,626 433,659 439,569 447,530 
Total assets$5,548,814 $5,505,311 $5,420,830 $5,374,772 $5,425,697 
Liabilities and Shareholders' Equity
Interest-bearing demand deposits
$2,534,291 13,796 2.21 $2,471,895 14,078 2.26 $2,450,034 14,145 2.29 $2,463,687 13,880 2.26 $2,473,543 14,156 2.32 
Savings deposits
259,585 143 0.22 262,240 164 0.25 264,761 164 0.25 269,309 165 0.25 273,313 165 0.25 
Time deposits906,875 8,047 3.60 912,611 8,342 3.63 897,416 8,330 3.68 914,108 8,810 3.87 970,588 9,939 4.15 
Total interest-bearing deposits3,700,751 21,986 2.41 3,646,746 22,584 2.46 3,612,211 22,639 2.49 3,647,104 22,855 2.51 3,717,444 24,260 2.65 
Securities sold under agreements to repurchase and federal funds purchased23,674 97 1.66 27,348 105 1.52 27,772 107 1.53 25,917 106 1.64 26,163 84 1.30 
FHLB advances and other borrowings248,357 2,355 3.85 238,806 2,371 3.94 168,939 1,791 4.21 104,068 1,030 3.97 112,859 1,118 4.02 
Subordinated notes and trust preferred debt37,175 921 10.05 37,023 669 7.17 68,749 1,597 9.21 68,910 1,330 7.74 68,739 1,296 7.65 
Total interest-bearing liabilities4,009,957 25,359 2.56 3,949,923 25,729 2.58 3,877,671 26,134 2.67 3,845,999 25,321 2.64 3,925,205 26,758 2.76 
Noninterest-bearing demand deposits850,415 882,552 902,128 904,031 887,726 
Other liabilities89,112 93,977 89,086 89,058 89,077 
Total liabilities4,949,484 4,926,452 4,868,885 4,839,088 4,902,008 
Shareholders' equity599,330 578,859 551,945 535,684 523,689 
Total$5,548,814 $5,505,311 $5,420,830 $5,374,772 $5,425,697 
Taxable-equivalent net interest income / net interest spread49,571 3.35 %51,100 3.43 %51,557 3.52 %50,064 3.49 %49,203 3.41 %
Taxable-equivalent net interest margin3.90 %4.00 %4.11 %4.07 %4.00 %
Taxable-equivalent adjustment(566)(569)(569)(552)(442)
Net interest income$49,005 $50,531 $50,988 $49,512 $48,761 
Ratio of average interest-earning assets to average interest-bearing liabilities128 %129 %129 %128 %127 %
11

NOTES:
(1) Yields and interest income on tax-exempt assets have been computed on a taxable-equivalent basis assuming a 21% tax rate.
(2) Average balance of investment securities is computed at fair value.
(3) Average balances include nonaccrual loans.
(4) Interest income on loans includes prepayment and late fees, where applicable.
(5) Interest income on loans includes accretion on purchase accounting marks of $4.2 million, $4.7 million, $5.3 million, $4.9 million and $6.6 million for the three months ended March 31, 2026, December 31, 2025, September 30, 2025, June 30, 2025 and March 31, 2025, respectively.



12

ORRSTOWN FINANCIAL SERVICES, INC.
HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA (Unaudited)
(In thousands)March 31,
2026		December 31,
2025		September 30,
2025		June 30,
2025		March 31,
2025
Profitability for the quarter:
Net interest income$49,005 $50,531 $50,988 $49,512 $48,761 
Provision for (recovery of) credit losses on loans and unfunded loan commitments
352 75 396 109 (554)
Noninterest income15,577 14,392 13,382 12,915 11,624 
Noninterest expenses36,728 37,355 36,297 37,614 38,176 
Income before income taxes27,502 27,493 27,677 24,704 22,763 
Income tax expense5,693 6,002 5,812 5,256 4,712 
Net income$21,809 $21,491 $21,865 $19,448 $18,051 
Financial ratios:
Return on average assets (1)
1.59 %1.55 %1.60 %1.45 %1.35 %
Return on average assets, adjusted (1)(2)(3)
n/an/an/a1.51 %1.45 %
Return on average equity (1)
14.76 %14.73 %15.72 %14.56 %13.98 %
Return on average equity, adjusted (1)(2)(3)
n/an/an/a15.12 %14.97 %
Net interest margin (1)
3.90 %4.00 %4.11 %4.07 %4.00 %
Efficiency ratio56.9 %57.5 %56.4 %60.3 %63.2 %
Efficiency ratio, adjusted (2)(3)
n/an/an/a58.7 %60.5 %
Per share information:
Income per common share:
Basic$1.13 $1.12 $1.14 $1.01 $0.94 
Basic, adjusted (2)(3)
n/an/an/a1.05 1.01 
Diluted1.12 1.11 1.13 1.01 0.93 
Diluted, adjusted (2)(3)
n/an/an/a1.04 1.00 
Book value30.76 30.32 29.33 28.07 27.32 
Tangible book value(3)
25.76 25.21 24.12 22.77 21.99 
Average tangible common equity(3)
17.96 18.15 19.70 18.43 17.91 
Cash dividends paid0.30 0.27 0.27 0.26 0.26 
Average basic shares19,274 19,251 19,224 19,173 19,157 
Average diluted shares19,410 19,384 19,364 19,342 19,328 
(1) Annualized.
(2) Ratio has been adjusted for non-recurring expenses for the three months ended June 30, 2025 and March 31, 2025. There were no non-recurring expenses for the three months ended March 31, 2026, December 31, 2025 and September 30, 2025.
(3) Non-GAAP based financial measure. Please refer to Appendix A - Supplemental Reporting of Non-GAAP Measures and GAAP to Non-GAAP Reconciliations for a discussion of our use of non-GAAP based financial measures, including tables reconciling GAAP and non-GAAP financial measures appearing herein.
13

ORRSTOWN FINANCIAL SERVICES, INC.
HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA (Unaudited)
(continued)
(In thousands)March 31,
2026		December 31,
2025		September 30,
2025		June 30,
2025		March 31,
2025
Noninterest income:
Service charges$2,871 $3,225 $2,997 $2,630 $2,395 
Interchange income1,513 1,553 1,620 1,441 1,427 
Swap fee income1,339 1,112 816 669 394 
Wealth management income5,557 5,739 5,277 5,267 5,415 
Mortgage banking activities326 503 522 478 302 
Income from life insurance
3,761 1,331 1,471 1,311 1,289 
Other income212 834 629 1,111 389 
Investment securities (losses) gains(2)95 50 8 13 
Total noninterest income$15,577 $14,392 $13,382 $12,915 $11,624 
Noninterest expenses:
Salaries and employee benefits$21,157 $21,980 $21,439 $21,364 $20,388 
Occupancy, furniture and equipment4,221 4,017 4,075 4,211 4,675 
Data processing1,537 1,292 1,116 965 924 
Advertising and bank promotions683 561 154 1,077 499 
FDIC insurance549 683 652 674 824 
Professional services1,221 1,947 1,703 2,016 1,826 
Taxes other than income1,025 574 828 295 942 
Intangible asset amortization2,239 2,348 2,410 2,472 2,535 
Merger-related expenses
— — — 968 1,649 
Restructuring expenses— — — — 91 
Other operating expenses4,096 3,953 3,920 3,572 3,823 
Total noninterest expenses$36,728 $37,355 $36,297 $37,614 $38,176 


14

HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA (Unaudited)
(continued)
(In thousands)March 31,
2026		December 31,
2025		September 30,
2025		June 30,
2025		March 31,
2025
Balance Sheet at quarter end:
Cash and cash equivalents$161,136 $149,774 $184,146 $149,377 $287,120 
Restricted investments in bank stocks23,984 26,717 24,111 21,204 19,693 
Securities available for sale947,018 952,740 890,357 885,373 855,456 
Loans held for sale, at fair value3,366 6,090 6,026 5,206 5,261 
Loans:
Commercial real estate:
Owner occupied645,026 644,713 629,481 622,315 617,854 
Non-owner occupied1,322,251 1,260,198 1,254,959 1,203,038 1,157,383 
Multi-family216,658 236,703 234,782 239,388 257,724 
Non-owner occupied residential151,560 155,749 163,138 165,479 168,354 
Agricultural114,409 121,417 118,596 124,291 134,916 
Commercial and industrial
481,815 489,371 479,929 487,063 455,494 
Acquisition and development:
1-4 family residential construction46,355 41,489 41,141 38,490 40,621 
Commercial and land development198,957 198,234 195,158 198,889 227,434 
Municipal27,744 25,302 28,664 28,693 30,780 
Total commercial loans3,204,775 3,173,176 3,145,848 3,107,646 3,090,560 
Residential mortgage:
First lien484,022 478,870 476,006 469,569 464,642 
Home equity – term5,685 5,972 5,800 5,784 9,224 
Home equity – lines of credit327,141 321,438 311,458 305,968 295,820 
Other - term(1)
22,442 22,906 23,737 25,384 — 
Installment and other loans17,254 18,331 16,887 17,028 15,739 
Total loans4,061,319 4,020,693 3,979,736 3,931,379 3,875,985 
Allowance for credit losses
(47,463)(47,681)(48,105)(47,898)(47,804)
Net loans held for investment4,013,856 3,973,012 3,931,631 3,883,481 3,828,181 
Goodwill69,751 69,751 69,751 69,751 68,106 
Other intangible assets, net35,751 37,990 40,338 42,748 45,230 
Total assets5,576,972 5,542,255 5,470,233 5,387,645 5,441,586 
Total deposits4,627,424 4,528,774 4,533,560 4,516,625 4,633,716 
FHLB advances and other borrowings and Securities sold under agreements to repurchase225,958 299,243 241,719 166,381 123,480 
Subordinated notes and trust preferred debt37,274 37,122 36,970 69,021 68,850 
Total shareholders' equity603,184 591,535 571,936 548,448 532,936 
(1) Other - term includes property assessed clean energy ("PACE") loans.

15

HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA (Unaudited)
(continued)
March 31,
2026		December 31,
2025		September 30,
2025		June 30,
2025		March 31,
2025
Capital and credit quality measures(1):
Total risk-based capital:
Orrstown Financial Services, Inc.13.5 %13.3 %13.1 %13.3 %13.1 %
Orrstown Bank13.6 %13.3 %12.9 %13.3 %13.0 %
Tier 1 risk-based capital:
Orrstown Financial Services, Inc.12.0 %11.7 %11.3 %11.1 %10.8 %
Orrstown Bank12.5 %12.2 %11.8 %12.1 %11.9 %
Tier 1 common equity risk-based capital:
Orrstown Financial Services, Inc.11.8 %11.5 %11.1 %10.9 %10.6 %
Orrstown Bank12.5 %12.2 %11.8 %12.1 %11.9 %
Tier 1 leverage capital:
Orrstown Financial Services, Inc.9.7 %9.5 %9.3 %9.0 %8.6 %
Orrstown Bank10.2 %9.9 %9.6 %9.8 %9.5 %
Average equity to average assets10.80 %10.51 %10.18 %9.97 %9.65 %
Allowance for credit losses to total loans1.17 %1.19 %1.21 %1.22 %1.23 %
Total nonaccrual loans to total loans0.74 %0.70 %0.66 %0.57 %0.59 %
Nonperforming assets to total assets0.56 %0.51 %0.48 %0.42 %0.42 %
Allowance for credit losses to nonaccrual loans158 %170 %184 %214 %210 %
Other information:
Net charge-offs$946 $499 $189 $115 $331 
Classified loans57,584 58,351 64,089 65,754 76,211 
Nonperforming and other risk assets:
Nonaccrual loans30,025 28,031 26,191 22,423 22,727 
Other real estate owned1,055 — — — 138 
Total nonperforming assets31,080 28,031 26,191 22,423 22,865 
Financial difficulty modifications still accruing
949 1,253 1,245 5,759 5,127 
Loans past due 90 days or more and still accruing443 1,040 497 1,312 400 
Total nonperforming and other risk assets$32,472 $30,324 $27,933 $29,494 $28,392 

(1) Capital ratios are estimated for the current period, subject to regulatory filings. The Company elected the three-year phase in option for the day-one impact of ASU 2016-13 for current expected credit losses ("CECL") to regulatory capital. Beginning in 2023, the Company adjusted retained earnings, allowance for credit losses includable in tier 2 capital and the deferred tax assets from temporary differences in risk weighted assets by the permitted percentage of the day-one impact from adopting the new CECL standard, which concluded at December 31, 2025. At March 31, 2026, the day-one impact of ASU 2016-13 was fully applied to the capital ratios.


16

Appendix A- Supplemental Reporting of Non-GAAP Measures and GAAP to Non-GAAP Reconciliations
Management believes providing certain other “non-GAAP” financial information will assist investors in their understanding of the effect on recent financial results from non-recurring charges.
As a result of acquisitions, the Company has intangible assets consisting of goodwill, core deposit and other intangible assets, which totaled $105.5 million and $107.7 million at March 31, 2026 and December 31, 2025, respectively. During the three months ended June 30, 2025 and March 31, 2025, the Company incurred $1.0 million and $1.6 million in merger-related expenses, respectively. The Company did not incur merger-related or other non-recurring expenses during the three months ended March 31, 2026, December 31, 2025 and September 30, 2025.
Tangible book value per common share, tangible common equity and the impact of the merger-related expenses on net income and associated ratios, as used by the Company in this earnings release, are determined by methods other than in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"). While we believe this information is a useful supplement to GAAP based measures presented in this earnings release, readers are cautioned that this non-GAAP disclosure has limitations as an analytical tool, should not be viewed as a substitute for financial measures determined in accordance with GAAP, and should not be considered in isolation or as a substitute for analysis of our results and financial condition as reported under GAAP, nor are such measures necessarily comparable to non-GAAP performance measures that may be presented by other companies. This supplemental presentation should not be construed as an inference that our future results will be unaffected by similar adjustments to be determined in accordance with GAAP.
The following tables present the computation of each non-GAAP based measure:
(In thousands)
Tangible Book Value per Common ShareMarch 31,
2026		December 31,
2025		September 30,
2025		June 30,
2025		March 31,
2025
Shareholders' equity (most directly comparable GAAP-based measure)$603,184 $591,535 $571,936 $548,448 $532,936 
Less: Goodwill69,751 69,751 69,751 69,751 68,106 
Other intangible assets35,751 37,990 40,338 42,748 45,230 
Related tax effect(7,508)(7,978)(8,471)(8,977)(9,498)
Tangible common equity (non-GAAP)$505,190 $491,772 $470,318 $444,926 $429,098 
Common shares outstanding19,611 19,507 19,501 19,536 19,510 
Book value per share (most directly comparable GAAP-based measure)$30.76 $30.32 $29.33 $28.07 $27.32 
Intangible assets per share5.00 5.11 5.21 5.30 5.33 
Tangible book value per share (non-GAAP)$25.76 $25.21 $24.12 $22.77 $21.99 


17

Return on Average Common EquityMarch 31,
2026		December 31,
2025		September 30,
2025		June 30,
2025		March 31,
2025
Net Income$21,809 $21,491 $21,865 $19,448 $18,051 
Average shareholders' equity$599,330 $578,859 $551,945 $535,684 $523,689 
Less: Average goodwill69,751 69,751 69,751 68,126 68,106 
Less: Average other intangible assets, gross37,132 39,467 41,809 44,304 46,864 
Average tangible equity$492,447 $469,641 $440,385 $423,254 $408,719 
Return on average tangible equity (non-GAAP) (1)
17.96 %18.15 %19.70 %18.43 %17.91 %
(1) - Annualized
18

(In thousands)
Three Months Ended
Adjusted Ratios for Non-recurring ChargesMarch 31,
2026		December 31, 2025September 30,
2025		June 30,
2025		March 31,
2025
Net income (A) - most directly comparable GAAP-based measure$21,809 $21,491 $21,865 $19,448 $18,051 
Plus: Merger-related expenses (B)— — — 968 1,649 
Less: Related tax effect (C)— — — (221)(368)
Adjusted net income (D=A+B-C) - Non-GAAP$21,809 $21,491 $21,865 $20,195 $19,332 
Average assets (E)$5,548,814$5,505,311$5,420,830$5,374,772$5,425,697
Return on average assets (= A / E) - most directly comparable GAAP-based measure (1)
1.59 %1.55 %1.60 %1.45 %1.35 %
Return on average assets, adjusted (= D / E) - Non-GAAP (1)
n/an/an/a1.51 %1.45 %
Average equity (F)$599,330 $578,859 $551,945 $535,684 $523,689 
Return on average equity (= A / F) - most directly comparable GAAP-based measure (1)
14.76 %14.73 %15.72 %14.56 %13.98 %
Return on average equity, adjusted (= D / F) - Non-GAAP (1)
n/a14.73 %15.72 %15.12 %14.97 %
Weighted average shares - basic (G) - most directly comparable GAAP-based measure19,274 19,251 19,224 19,173 19,157 
Basic earnings (loss) per share (= A / G) - most directly comparable GAAP-based measure$1.13 $1.12 $1.14 $1.01 $0.94 
Basic earnings per share, adjusted (= D / G) - Non-GAAPn/an/an/a$1.05 $1.01 
Weighted average shares - diluted (H) - most directly comparable GAAP-based measure19,410 19,384 19,364 19,342 19,328 
Diluted earnings (loss) per share (= A / H) - most directly comparable GAAP-based measure$1.12 $1.11 $1.13 $1.01 $0.93 
Diluted earnings per share, adjusted (= D / H) - Non-GAAPn/an/an/a$1.04 $1.00 
continued
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Three Months Ended
March 31,
2026		December 31, 2025September 30,
2025		June 30,
2025		March 31,
2025
Noninterest expense (I) - most directly comparable GAAP-based measure$36,728 $37,355 $36,297 $37,614 $38,176 
Less: Merger-related expenses (B)— — — (968)(1,649)
Adjusted noninterest expense (J = I - B) - Non-GAAP$36,728 $37,355 $36,297 $36,646 $36,527 
Net interest income (K)$49,005 $50,531 $50,988 $49,512 $48,761 
Noninterest income (L)15,577 14,392 13,382 12,915 11,624 
Total operating income (M = K + L)$64,582 $64,923 $64,370 $62,427 $60,385 
Efficiency ratio (= I / M) - most directly comparable GAAP-based measure56.9 %57.5 %56.4 %60.3 %63.2 %
Efficiency ratio, adjusted (= J / M) - Non-GAAPn/an/an/a58.7 %60.5 %
(1) Annualized


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Appendix B- Investment Portfolio Concentrations
The following table summarizes the credit ratings and collateral associated with the Company's investment security portfolio, excluding equity securities, at March 31, 2026:
(In thousands)
SectorPortfolio MixAmortized BookFair ValueCredit EnhancementAAAAAABBBBBNRCollateral / Guarantee Type
Unsecured ABS— %$2,455 $2,383 29 %— %— %— %— %— %100 %Unsecured Consumer Debt
Student Loan ABS— 2,809 2,803 31 — — — — — 100 Seasoned Student Loans
Federal Family Education Loan ABS7 70,295 69,987 12 — 47 33 7 13 — 
Federal Family Education Loan (1)
PACE Loan ABS— 1,634 1,494 7 100 — — — — — 
PACE Loans (2)
Non-Agency CMBS3 27,043 27,051 29 — — — — — 100 
Non-Agency RMBS4 35,718 34,599 16 93 7 — — — — 
Reverse Mortgages (3)
Municipal - General Obligation10 99,842 92,721 16 78 6 — — — 
Municipal - Revenue13 119,566 107,627 — 82 12 — — 6 
SBA ReRemic (5)
— 1,460 1,444 — 100 — — — — 
SBA Guarantee (4)
Small Business Administration— 2,821 2,884 — 100 — — — — 
SBA Guarantee (4)
Agency MBS25 242,363 240,315 — 100 — — — — 
Residential Mortgages (4)
Agency CMO36 350,010 347,290 — 100 — — — — 
U.S. Treasury securities2 15,014 14,197 — 100 — — — — 
U.S. Government Guarantee (4)
Corporate bonds— 1,950 1,983 — — 51 49 — — 
100 %$972,980 $946,778 5 %84 %5 %1 %1 %4 %
(1) 97% guaranteed by U.S. government
(2) PACE acronym represents Property Assessed Clean Energy loans
(3) Non-agency reverse mortgages with current structural credit enhancements
(4) Guaranteed by U.S. government or U.S. government agencies
(5) SBA ReRemic acronym represents Re-Securitization of Real Estate Mortgage Investment Conduits
Note: Ratings in table are the lowest of the six rating agencies (Standard & Poor's, Moody's, Fitch, Morningstar, DBRS and Kroll Bond Rating Agency). Standard & Poor's rates U.S. government obligations at AA+.

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About the Company
With $5.6 billion in assets, Orrstown Financial Services, Inc. and its wholly-owned subsidiary, Orrstown Bank, provide a wide range of consumer and business financial services in Berks, Cumberland, Dauphin, Franklin, Lancaster, Perry and York Counties, Pennsylvania and Anne Arundel, Baltimore, Harford, Howard, and Washington Counties, Maryland, as well as Baltimore City, Maryland. The Company’s lending area also includes counties in Pennsylvania, Maryland, Delaware, Virginia and West Virginia within a 75-mile radius of the Company's executive and administrative offices as well as the District of Columbia. Orrstown Bank is an Equal Housing Lender and its deposits are insured up to the legal maximum by the FDIC. Orrstown Financial Services, Inc.’s common stock is traded on Nasdaq (ORRF). For more information about Orrstown Financial Services, Inc. and Orrstown Bank, visit www.orrstown.com.
Cautionary Note Regarding Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements reflect the current views of the Company's management with respect to, among other things, future events and the Company's financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “forecast,” “goal,” “target,” “would” and “outlook,” or the negative variations of those words or other comparable words of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates, predictions or projections about events or the Company's industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond the Company's control. Accordingly, the Company cautions you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements and there can be no assurances that the Company will achieve the desired level of new business development and new loans, growth in the balance sheet and fee-based revenue lines of business, cost savings initiatives and continued reductions in risk assets or mitigation of losses in the future. Factors which could cause the actual results to differ from those expressed or implied by the forward-looking statements include, but are not limited to, the following: interest rate changes or volatility; general economic conditions (including inflation and concerns about liquidity) on a national basis or in the local markets in which the Company operates; ineffectiveness of the Company’s strategic growth plan due to changes in current or future market conditions; the effects of competition and how it may impact our community banking model, including industry consolidation and development of competing financial products and services; changes in consumer behavior due to changing political, business and economic conditions, or legislative or regulatory initiatives; changes in, and evolving interpretations of, existing and future laws and regulations; changes in credit quality; inability to raise capital, if necessary, under favorable conditions; volatility in the securities markets; the demand for our products and services; deteriorating economic conditions; geopolitical tensions; operational risks including, but not limited to, cybersecurity incidents, fraud, natural disasters and future pandemics; expenses associated with litigation and legal proceedings; and other risks and uncertainties, including those detailed in our Annual Report on Form 10-K for the year ended December 31, 2025 under the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in subsequent filings made with the Securities and Exchange Commission.
The foregoing list of factors is not exhaustive. If one or more events related to these or other risks or uncertainties materializes, or if the Company's underlying assumptions prove to be incorrect, actual results may differ materially from what the Company anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and the Company disclaims any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New risks and uncertainties arise from time to time, and it is not possible for the Company to predict those events or how they may affect it. In addition, the Company cannot assess the impact of each factor on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that the Company or persons acting on the Company's behalf may issue.
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The review period for subsequent events extends up to and includes the filing date of a public company’s financial statements, when filed with the Securities and Exchange Commission. Accordingly, the consolidated financial information presented in this announcement is subject to change. Annualized, pro forma, projected and estimated numbers in this document are used for illustrative purposes only and are not forecasts and may not reflect actual results.


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Exhibit 99.2
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Source: View Original Filing on SEC EDGAR

FAQ

How did Orrstown Financial Services (ORRF) perform in Q1 2026?

Orrstown generated higher profits in Q1 2026, with net income of $21.8 million versus $18.1 million a year earlier. Diluted EPS rose to $1.12, supported by solid fee income, lower noninterest expenses, and healthy returns on assets and equity.

What happened to Orrstown Financial Services’ net interest margin in Q1 2026?

The tax‑equivalent net interest margin declined to 3.90% from 4.00% in Q4 2025. Lower yields on loans and securities, partly from prior rate cuts, more than offset slightly reduced funding costs on deposits and borrowings during the quarter.

How strong is Orrstown Financial Services’ capital position after Q1 2026?

Capital remained strong, with the total risk‑based capital ratio at 13.5% and tier 1 risk‑based capital at 12.0%. The tangible common equity ratio improved to 9.2%, and all regulatory capital ratios stayed above “well capitalized” minimums under current bank guidelines.

How did credit quality at Orrstown Financial Services change in Q1 2026?

Credit quality remained generally sound. The allowance for credit losses on loans was $47.5 million, or 1.17% of total loans. Nonaccrual loans increased slightly to 0.74% of loans, while nonperforming assets represented 0.56% of total assets.

What dividend did Orrstown Financial Services declare for shareholders?

The Board declared a quarterly cash dividend of $0.30 per common share, payable on May 12, 2026 to shareholders of record as of May 5, 2026. This continues the company’s practice of returning capital through regular cash dividends.

How did noninterest income and expenses affect Orrstown’s Q1 2026 results?

Noninterest income increased to $15.6 million, boosted by $2.4 million in life insurance death benefits and higher swap fees. Noninterest expenses declined to $36.7 million, reflecting lower salaries and professional services, which improved the efficiency ratio to 56.9%.

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