UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)
x			ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, ~~2024~~2025
☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to _______

Commission file number 000-20827

CASS INFORMATION SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

Missouri

43-1265338

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

12444 Powerscourt Drive, Suite 550, St. Louis, Missouri 63131

(314) 506-5500

(Address of principal executive offices) (Zip Code)

(Telephone Number, incl. area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, par value $0.50 per share

CASS

The Nasdaq Global Select Market

Securities registered pursuant to Section 12(g) of the Act:

Title of each Class

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes ☐ No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes ☐ No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes x No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large accelerated filer: ☐ Accelerated filer: x Non-accelerated filer: ☐ Smaller reporting company: ☐ Emerging growth company: ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. x

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No x

The aggregate market value of the common stock held by non-affiliates of the Registrant was approximately $~~529~~555.5 million based on the closing price of the common stock of $4043.0745 on June 30, ~~2024~~2025, as reported by The Nasdaq Global Select Market. As of February 2127, ~~2025~~2026, the Registrant had 1312,~~503~~901,~~248~~080 shares outstanding of common stock.

DOCUMENTS INCORPORATED BY REFERENCE

Certain information required for Part III of this report is incorporated by reference to the Registrant’s Proxy Statement for the ~~2025~~2026 Annual Meeting of Shareholders.

Auditor Name: KPMG LLP Auditor Location: St. Louis, MO Auditor Firm ID: 185

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CASS INFORMATION SYSTEMS, INC.

FORM 10-K ANNUAL REPORT

TABLE OF CONTENTS

PART I.
Item 1.	BUSINESS	1
Item 1A.	RISK FACTORS	1110
Item 1B.	UNRESOLVED STAFF COMMENTS	1918
Item 1C.	CYBERSECURITY	1918
Item 2.	PROPERTIES	20
Item 3.	LEGAL PROCEEDINGS	2120
Item 4.	MINE SAFETY DISCLOSURES	2120
PART II.
Item 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES	2221
Item 6.	RESERVED	2322
Item 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	2322
Item 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	3940
Item 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	4142
Item 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	8185
Item 9A.	CONTROLS AND PROCEDURES	8185
Item 9B.	OTHER INFORMATION	8387
Item 9C.	DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS	8387
PART III.
Item 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	8488
Item 11.	EXECUTIVE COMPENSATION	8588
Item 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	8588
Item 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE	8589
Item 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES	8689
PART IV.
Item 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES	8790
Item 16.	FORM 10-K SUMMARY	8790
	SIGNATURES	8891

Forward-looking Statements - Factors That May Affect Future Results

This report may contain or incorporate by reference forward-looking statements made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Although we believe that, in making any such statements, our expectations are based on reasonable assumptions, forward-looking statements are not guarantees of future performance and involve risks, uncertainties, and other factors beyond our control, which may cause future performance to be materially different from expected performance summarized in the forward-looking statements. These risks, uncertainties and other factors are discussed in the section Part I, Item 1A, “Risk Factors.” We undertake no obligation to publicly update or revise any forward-looking statements to reflect changed assumptions, the occurrence of anticipated or unanticipated events, or changes to future results over time.

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PART I.

ITEM 1. BUSINESS

Description of Business

Cass Information Systems, Inc. (“Cass” or the “Company”) provides payment and information processing services to large manufacturing, distribution and retail enterprises across the United States. The Company’s services include freight invoice rating, payment processing, auditing, and the generation of accounting and transportation information. Cass also processes and pays facility-related invoices, which include electricity and gas as well as waste and telecommunications expenses~~, and is a provider of telecom expense management solutions~~. Cass solutions include integrated payments, a B2B payment platform for clients that require an agile fintech partner. Additionally, the Company offers a church management software solution and an on-line platform to provide generosity services for faith-based and non-profit organizations. The Company’s bank subsidiary, Cass Commercial Bank (the “Bank”), supports the Company’s payment operations. The Bank also provides banking services to its target markets, which include privately held businesses in the St. Louis metropolitan area and restaurant franchises and faith-based ministries within the United States.

On April 7, 2025, the Company signed an Asset Purchase Agreement providing for the sale of its telecom expense management and managed mobility solutions business unit ("TEM Business Unit") to Asignet USA Inc ("Asignet") for a purchase price of $18.0 million. The sale closed on June 30, 2025. The Company also signed a Transition Services Agreement with Asignet to provide certain information technology, data ingestion, and payment processing services for a period of time not to exceed 18 months after closing.

Company Strategy and Core Competencies

Cass is an information services company with a primary focus on processing payables and payables-related transactions for large corporations located in the United States. Cass possesses four core competencies that encompass most of its processing services.

Data acquisition – This refers to the gathering of data elements from diverse, heterogeneous sources and the building of complete databases for our customers. Data is the raw material of the information economy. Cass gathers vital data from complex and diverse input documents, electronic media, proprietary databases and data feeds, including data acquired from vendor invoices as well as customer procurement and sales systems. Through its numerous methods of obtaining streams and pieces of raw data, including those supported by artificial intelligence ("AI"), Cass is able to assemble vital data into centralized data management systems and warehouses, thus producing an engine to create the power of information for managing critical corporate functions and processing systems.

Data management – Once data is assembled, Cass is able to utilize the power from derived information to produce significant savings and benefits for its clients. This information is integrated into customers’ unique financial and accounting systems, eliminating the need for internal accounting processing and providing internal and external support for these critical systems. Information is also used to produce management and exception reporting for operational control, feedback, planning assistance and performance measurement.

Business Intelligence – Receiving information in the right place at the right time and in the required format is paramount for business survival. Cass’ information delivery solutions provide reports, digital images, data files and retrieval capabilities through the internet or directly into customer internal systems. Cass’ proprietary internet management delivery system is the foundation for driving these critical functions. Transaction, operational, control, status and processing exception information are all delivered through this system creating an efficient, accessible and highly reliable asset for Cass customers.

Financial exchange – Since Cass is unique among its competition in that it owns a commercial bank, it is also able to manage the movement of funds from its customers to their suppliers. This is a distinguishing factor, which clearly requires the processing capability, operating systems and financial integrity of a banking organization. Cass provides immediate, accurate, controlled and protected funds management and transfer system capabilities for all of its customers. Old and costly check processing and delivery mechanisms are replaced with more efficient electronic cash management and funds transfer systems.

Cass’ core competencies allow it to perform the highest volumes of transaction processing in an integrated, efficient and systematic approach. Not only is Cass able to process the transaction, it is also able to collect the data defining the transaction and effect the financial payment governing its terms.

These core competencies, enhanced through shared business processes, drive Cass’ strategic business units. Building upon these foundations, Cass continues to explore new business opportunities that leverage these competencies and processes.

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Marketing, Customers and Competition

The Company, through its Transportation Information Services business unit, is one of the largest firms in the transportation bill processing and payment industry in the United States based on the total dollars of transportation bills paid and items processed. Competition consists of a few primary competitors and numerous small transportation bill audit firms located throughout the United States. While offering transportation payment services, few of these audit firms compete on a national basis. These competitors compete mainly on price, functionality and service levels. The Company, through its ~~Utility~~Facilities Expense Management business unit, also competes with other companies located throughout the United States that pay utility bills and provide management reporting. Available data indicates that the Company is one of the largest providers of utility information processing and payment services. Cass is unique among these competitors in that it is not exclusively affiliated with any one energy service provider (“ESP”). Various ESPs market the Company’s services, adding value with their unique auditing, consulting and technological capabilities. Many of Cass’ services are customized for the ESPs, providing a full-featured solution without any development costs to the ESP. The Company, through its Telecom Information Services business unit, is a leader in the growing telecom expense management market and competes with other companies located throughout the United States in this market. The Company, through its Waste Expense Management business, is one of the largest providers of waste invoice management solutions and competes against small expense management companies along with large national account programs of major haulers. The Company's TouchPoint division offers a church management software solution and an on-line platform to provide generosity services for faith-based and non-profit organizations, which is a complementary service offering to the Bank’s faith-based customers. Also, the Company, through its CassPay operation, competes with providers of corporate payment solutions.

The Bank is organized as a Missouri trust company with banking powers and was founded in 1906. The Company was originally classified as a bank holding corporation due to its ownership of a federally-insured commercial bank and was originally organized in 1982 as Cass Commercial Corporation under the laws of Missouri. Approval by the Board of Governors of the Federal Reserve System was received in February 1983. The Company changed its name to Cass Information Systems, Inc. in January 2001. In December 2011, the Federal Reserve Bank (“FRB”) of St. Louis approved the election of Cass Information Systems, Inc. to become a financial holding company. As a financial holding company, Cass may engage in activities that are financial in nature or incidental to a financial activity. The Bank encounters competition from numerous banks and financial institutions located throughout the St. Louis, Missouri metropolitan area and other areas in which the Bank competes. The Bank’s principal competitors, however, are large bank holding companies that are able to offer a wide range of banking and related services through extensive branch networks. The Bank targets its services to privately held businesses, restaurant franchises, and faith-based ministries located in St. Louis, Missouri and other selected cities located throughout the United States.

The Company holds several trademarks for the payment and rating services it provides. These include: FreightPay®, Transdata®, Ratemaker®, Best Rate®, Rate Exchange®, CassPort®, Cass Freight Index®, Cass Truckload Linehaul Index®, Cass Intermodal Price Index® Expense$mart®, ExpenseSmart®, TouchPoint®, Gyve®, Generosity Made Simple®, WasteVision™, AcuAudit™ and Direct2Carrier Payments™. The Company holds patents for methods and systems of the following: managing employee-liable expenses, communicating expense management information, electronic auditing, and electronically generating and analyzing shipping parameters. The Company also holds patents for computer readable media for electronic auditing.

The Company and its subsidiaries have a varied client base and are not dependent on any one customer or group of customers for a significant portion of its business.

Employees and Human Capital Resources

The Company and its subsidiaries had ~~1,027~~860 full-time and ~~221~~156 part-time employees as of February 2127, ~~2025~~2026, exclusive of discontinued operations. Of these employees, the Bank had 6468 full-time and no part-time employees.

Cass has long been committed to comprehensive and competitive compensation and benefits programs to attract and retain talent in a competitive environment. Retention of skilled and highly trained employees is critical as the Company’s future operating results depend substantially upon the continued service of executive officers and key personnel. Furthering the philosophy to attract and retain a pool of talented and motivated employees who will continue to advance the Company’s purpose and contribute to overall success, compensation and benefits programs include: a noncontributory profit sharing program for exempt employees; a defined contribution 401(k) plan to provide retirement benefits to eligible employees; a performance-based equity compensation program for executive officers and key personnel; and incentive programs for loan

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program for exempt employees; a defined contribution 401(k) plan to provide retirement benefits to eligible employees; a performance-based equity compensation program for executive officers and key personnel; and incentive programs for sales personnel. Cass also provides comprehensive health, dental, and vision plans to most employees, as well as free employee assistance programs to all employees and members of their families.

The Company invests in its employees’ futures by assisting with tuition reimbursement for continued education. Employees are also able to participate in educational seminars run by outside parties to maintain and expand professional knowledge.

In order to develop a workforce that aligns with the Company’s corporate values, regularly sponsored campaigns and events occur, such as charitable workplace campaigns, food drives to assist local food banks, and toy drives to support charities during the holidays. The Company offers paid time off for charitable endeavors. Additionally, the Company supports a number of organizations with annual financial contributions.

The Company ~~recognizes~~also ~~the~~continues ~~benefits~~its ofcommitment ~~building~~to providing a ~~corporate~~workplace ~~culture~~ that ~~promotes~~is ~~diversity~~free of harassment and ~~fosters~~discrimination ~~unique~~by ~~ideas~~taking proactive measures and ~~ways~~providing ofall ~~thinking.~~employees ~~Among~~with ~~other~~non-discrimination ~~things,~~and ~~Cass~~sexual ~~focuses~~harassment onprevention ~~cultivating~~training on an ~~environment~~annual ~~that~~basis. ~~encourages~~Initiatives ~~collaboration,~~are ~~flexibility~~supported and ~~fairness~~promoted to ~~enable~~provide all employees toa ~~contribute~~place towhere ~~their~~they ~~full~~feel ~~potential~~welcomed, appreciated and valued.

As of December 31, 2024, 70% of the Company's U.S. employees were female, and 22% were ethnically diverse. Within the management group, 53% were female, and 15% were ethnically diverse. The Company continues to support and provide diversity training to all employees. The Company also continues its commitment to providing a workplace that is free of harassment and discrimination by taking proactive measures and providing all employees with non-discrimination and sexual harassment prevention training on an annual basis. Initiatives are supported and promoted to provide all employees a place where they feel welcomed, appreciated and valued.

Equal opportunities, anti-harassment, non-discrimination, the health and safety of employees and work-life balance are actively promoted as more fully described in the Company's Environmental, Social, and Governance ("ESG") report.

Supervision and Regulation

The Company and its bank subsidiary are extensively regulated under federal and state law. These laws and regulations are intended to primarily protect depositors, not shareholders. The Bank is subject to regulation and supervision by the Missouri Division of Finance, the FRB and the Federal Deposit Insurance Corporation (the “FDIC”). The Company is a financial holding company within the meaning of the Bank Holding Company Act of 1956, as amended (the “BHC Act”), and as such, it is subject to regulation, supervision and examination by the FRB. Significant elements of the laws and regulations applicable to the Company and the Bank are described below. The description is qualified in its entirety by reference to the full text of the statutes, regulations and policies that are described. Also, such statutes, regulations and policies are continually under review by Congress and state legislatures and federal and state regulatory agencies. A change in statutes, regulations or regulatory policies applicable to the Company and its subsidiaries could have a material effect on the business, financial condition and results of operations of the Company.

Bank Holding Company Activities – In general, the BHC Act limits the business of bank holding companies to banking, managing or controlling banks and other related activities. In addition, bank holding companies that qualify and elect to be financial holding companies, such as the Company, may engage in any activity, or acquire and retain the shares of a company engaged in any activity, that is either (i) financial in nature or incidental to such financial activity or (ii) complementary to a financial activity and does not pose a substantial risk to the safety and soundness of depository institutions or the financial system generally. Such permitted activities include securities underwriting and dealing, insurance underwriting and making merchant banking investments.

To maintain financial holding company status, a financial holding company and all of its depository institution subsidiaries must be “well capitalized” and “well managed.” A depository institution subsidiary is considered to be “well capitalized” if it satisfies the requirements for this status discussed in the section “Prompt Corrective Action” below. A depository institution subsidiary is considered “well managed” if it received a composite rating and management rating of at least “satisfactory” in its most recent examination. A financial holding company’s status will also depend upon it maintaining its status as “well capitalized” and “well managed’ under applicable FRB regulations. If a financial holding company ceases to meet these capital and management requirements, the FRB may impose limitations or conditions on the conduct of its activities during the non-compliance period, and the company may not commence any of the broader financial activities permissible for financial holding companies or acquire a company engaged in such financial activities without prior approval of the FRB. If the company does not return to compliance within 180 days, the FRB may require divestiture of the holding company’s depository institutions.

In order for a financial holding company to commence any new activity permitted by the BHC Act or to acquire a company engaged in any new activity permitted by the BHC Act, each insured depository institution subsidiary of the financial

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~~In order for a financial~~ holding company to commence any new activity permitted by the BHC Act or to acquire a company engaged in any new activity permitted by the BHC Act, each insured depository institution subsidiary of the financial holding company must have received a rating of at least “satisfactory” in its most recent examination under the Community Reinvestment Act. See “Community Reinvestment Act” below.

The FRB has the power to order any bank holding company or its subsidiaries to terminate any activity or to terminate its ownership or control of any subsidiary when the FRB has reasonable grounds to believe that continuation of such activity or such ownership or control constitutes a serious risk to the financial soundness, safety or stability of any bank subsidiary of the bank holding company.

The BHC Act, the Bank Merger Act, and other federal and state statutes regulate acquisitions of banks and banking companies. The BHC Act requires the prior approval of the FRB for the direct or indirect acquisition by the Company of more than 5% of the voting shares or substantially all of the assets of a bank or bank holding company. Under the Bank Merger Act, the prior approval of the FRB or other appropriate bank regulatory authority is required for the Bank to merge with another bank or purchase the assets or assume the deposits of another bank. In reviewing acquisition applications, the bank regulatory authorities will consider, among other things, the competitive effect and public benefits of the transactions, the capital position of the combined organization, the risks to the stability of the U.S. banking or financial system, the applicant’s performance record under the Community Reinvestment Act and its compliance with fair housing laws.

The Dodd-Frank Act – The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), enacted in July 2010, significantly restructured the financial regulatory environment in the United States, affecting all bank holding companies and banks, including the Company and the Bank, some of which are described in more detail below. The impact of the Dodd-Frank Act on the Company and the Bank has been substantial.

Enhanced Prudential Standards – The FRB is required to monitor emerging risks to financial stability and enact enhanced supervision and prudential standards applicable to large bank holding companies and certain non-bank covered companies designated as systemically important by the Financial Stability Oversight Council. The Dodd-Frank Act mandates that certain regulatory requirements applicable to these systemically important financial institutions be more stringent than those applicable to other financial institutions. In 2019, the FRB adopted new rules impacting certain capital and liquidity requirements and other enhanced prudential standards. The final rules assign all domestic bank holding companies with $100 billion or more in total consolidated assets to one of four categories of tailored regulatory requirements. The Company and the Bank are generally not impacted by these rules. The enhanced prudential standards rules, as amended in 2019, require publicly traded bank holding companies with $50 billion or more in total consolidated assets to establish risk committees. Prior to the amendment, the requirement to establish a risk committee was applicable to publicly traded companies with $10 billion or more in consolidated assets.

Dividends and Stock Repurchases – Both the Company and the Bank are subject to various regulations that restrict their ability to pay dividends and the amount of dividends that they may pay. Under the Federal Deposit Insurance Corporation Improvement Act of 1991, a depository institution, such as the Bank, may not pay dividends if payment would cause it to become undercapitalized or if it is already undercapitalized. The payment of dividends by the Company and the Bank may also be affected or limited by other factors, such as the requirement to maintain adequate capital and, under certain circumstances, the ability of federal regulators to prohibit dividend payments as an unsound or unsafe practice.

From time to time, the Company's Board of Directors has authorized stock repurchase plans. Bank holding companies must consult with the Federal Reserve before redeeming any equity or other capital instrument included in tier 1 or tier 2 capital prior to stated maturity, if such redemption could have a material effect on the level or composition of the organization’s capital base. In addition, a bank holding company is unable to repurchase shares equal to 10% or more of its net worth if it would not be well-capitalized (as defined by the Federal Reserve) after giving effect to such repurchase. Bank holding companies experiencing financial weaknesses, or that are at significant risk of developing financial weaknesses, must consult with the Federal Reserve before redeeming or repurchasing common stock or other regulatory capital instruments.

In August 2022, the Inflation Reduction Act of 2022 (the “Inflation Reduction Act") was enacted. Among other things, the Inflation Reduction Act imposes a new 1% excise tax on the fair market value of stock repurchased after December 31, 2022 by publicly traded U.S. corporations. With certain exceptions, the value of stock repurchased is determined net of stock issued in the year, including shares issued pursuant to compensatory arrangements.

Capital Requirements – As a bank holding company, the Company and the Bank are subject to capital requirements pursuant to the FRB’s capital guidelines which include (i) risk-based capital guidelines, which are designed to make capital requirements more sensitive to various risk profiles and account for off-balance sheet exposure; (ii) guidelines that consider market risk, which is the risk of loss due to change in value of assets and liabilities due to changes in interest rates; and (iii)

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~~requirements more sensitive to various risk profiles and account for off-balance sheet exposure; (ii)~~ guidelines that ~~consider market risk, which is the risk of loss due to change in value of assets and liabilities due to changes in interest rates; and (iii) guidelines that~~ use a leverage ratio which places a constraint on the maximum degree of risk to which a financial holding company may leverage its equity capital base.

The Basel III Capital Rules require the Company and the Bank to maintain the following:

•a minimum ratio of common equity Tier 1 capital to risk-weighted assets of at least 4.5%, plus a 2.5% capital conservation buffer (resulting in a minimum common equity Tier 1 capital ratio of 7.0%);

•a minimum ratio of Tier 1 capital to risk-weighted assets of at least 6.0%, plus a 2.5% capital conservation buffer (resulting in a minimum Tier 1 capital ratio of 8.5%);

•a minimum ratio of total capital (that is, Tier 1 plus Tier 2 capital) to risk-weighted assets of at least 8.0%, plus the 2.5% capital conservation buffer (resulting in a minimum total capital ratio of 10.5%); and

•a minimum leverage ratio of 4.0%, calculated as the ratio of Tier 1 capital to adjusted average consolidated assets.

The capital conservation buffer is designed to absorb losses during periods of economic stress. Banking institutions with a ratio of common equity Tier 1 capital to risk-weighted assets above the minimum but below the conservation buffer will face limitations on the payment of dividends, common stock repurchases and discretionary cash payments to executive officers based on the amount of the shortfall.

Common equity Tier 1 capital is generally defined as common stockholders’ equity and retained earnings. Tier 1 capital is generally defined as common equity Tier 1 and Additional Tier 1 capital. Additional Tier 1 capital generally includes certain noncumulative perpetual preferred stock and related surplus and minority interests in equity accounts of consolidated subsidiaries. Total capital includes Tier 1 capital (common equity Tier 1 capital plus Additional Tier 1 capital) and Tier 2 capital. Tier 2 capital is comprised of capital instruments and related surplus meeting specified requirements. Also included in Tier 2 capital is the allowance for credit losses limited to a maximum of 1.25% of risk-weighted assets and, for non-advanced approaches institutions like Cass that have exercised a one-time opt-out election regarding the treatment of Accumulated Other Comprehensive Income (“AOCI”), up to 45% of net unrealized gains on available-for-sale equity investment securities with readily determinable fair market values.

The calculation of all types of regulatory capital is subject to deductions and adjustments specified in the regulations. For instance, the Basel III Capital Rules and the capital simplification rules enacted in 2019 provide for a number of deductions from and adjustments to common equity Tier 1 capital. These include, for example, the requirement that certain deferred tax assets and significant investments in non-consolidated financial entities be deducted from Tier 1 capital to the extent that any one such category exceeds 25% of common equity Tier 1 capital.

In determining the amount of risk-weighted assets for purposes of calculating risk-based capital ratios, all assets, including certain off-balance sheet assets, are multiplied by a risk weight factor assigned by the regulations based on the risks believed inherent in the type of asset. Higher levels of capital are required for asset categories believed to present greater risk. For example, a risk weight of 0% is assigned to cash and U.S. government securities, a risk weight of 50% is generally assigned to prudently underwritten first lien one to four-family residential mortgages, a risk weight of 100% is assigned to commercial and consumer loans, a risk weight of 150% is assigned to certain past due loans, and a risk weight of between 0% to 600% is assigned to permissible equity interests, depending on certain specified factors.

The FRB has authority to establish individual minimum capital requirements in appropriate cases upon a determination that an institution’s capital level is or may become inadequate in light of the particular risks or circumstances. As of December 31, ~~2024~~2025, the Company and the Bank met all capital adequacy requirements under the Basel III Capital Rules.

InSource ~~December~~of ~~2017,~~Strength ~~the~~Doctrine ~~Basel~~– ~~Committee~~FRB ~~published~~and ~~standards~~other ~~that~~regulations itrequire ~~described~~bank asholding ~~the~~companies ~~finalization~~to ofact ~~the~~as ~~Basel~~a ~~III~~source ~~post-crisis~~of ~~regulatory~~financial ~~reforms~~and ~~(commonly~~managerial ~~referred~~strength to astheir ~~“Basel~~subsidiary ~~IV”)~~banks. ~~Among~~Under ~~other~~this ~~things~~requirement, ~~these standards revise~~ the ~~Basel~~Company ~~Committee's~~is ~~standardized~~expected ~~approach~~to ~~for~~commit ~~credit~~resources ~~risk~~to ~~(including~~support bythe ~~recalibrating~~Bank. ~~risk~~Any ~~weights~~capital ~~and~~loans ~~introducing~~by ~~new~~a ~~capital~~bank ~~requirements~~holding ~~for~~company ~~certain~~to ~~“unconditionally~~any ~~cancellable~~of ~~commitments,”~~its ~~such~~subsidiary asbanks ~~unused~~are ~~credit~~subordinate ~~card~~in ~~lines~~right of ~~credit)~~payment ~~and~~to ~~provides~~depositors aand ~~new~~to ~~standardized~~certain ~~approach~~other ~~for~~indebtedness ~~operational~~of ~~risk~~such ~~capital~~subsidiary banks. ~~Under~~In the ~~Basel~~event ~~framework,~~of ~~these~~a ~~standards~~bank ~~went~~holding ~~into~~company’s ~~effect on January 1~~bankruptcy, ~~2023,~~any ~~with~~commitment anby ~~aggregate output floor phasing in through January 1, 2027. Under~~ the ~~current~~bank ~~U.S.~~holding ~~capital~~company ~~rules,~~to ~~operational risk capital requirements and~~ a ~~capital~~federal ~~floor~~bank ~~apply~~regulatory ~~only~~agency to ~~advanced~~maintain ~~approaches institutions, and not to~~ the ~~Company~~capital ~~or the Bank. The impact~~ of ~~Basel~~a IVsubsidiary onbank ~~the Company~~ will ~~depend~~be onassumed by the ~~manner~~bankruptcy intrustee ~~which~~and itentitled isto ~~implemented~~priority byof ~~the federal bank regulators~~payment.

Deposit Insurance – Substantially all of the deposits of the Bank are insured up to applicable limits by the Deposit Insurance Fund (“DIF”) of the FDIC, and the Bank is subject to deposit insurance assessments to maintain the DIF. Deposit insurance assessments are based on average consolidated total assets minus average tangible equity. Under the FDIC’s risk-based assessment system, insured institutions with less than $10 billion in assets, such as the Bank, are assigned to one of

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~~Source~~four ofrisk ~~Strength~~categories ~~Doctrine~~based –on ~~FRB~~supervisory ~~and other regulations require bank holding companies to act as a source of financial and managerial strength to their subsidiary banks. Under this requirement~~evaluations, ~~the~~regulatory ~~Company is expected to commit resources to support the Bank. Any~~ capital ~~loans~~level, ~~by a bank holding company to any of its subsidiary banks are subordinate in right of payment to depositors~~ and to certain other ~~indebtedness~~factors, ofwith ~~such~~less ~~subsidiary~~risky ~~banks.~~institutions Inpaying ~~the~~lower ~~event~~assessments. ofAn ~~a bank holding company~~institution’s ~~bankruptcy,~~assessment ~~any~~rate ~~commitment~~depends byupon the ~~bank~~category ~~holding company~~ to awhich ~~federal~~it ~~bank~~is ~~regulatory~~assigned ~~agency to maintain the capital of a subsidiary bank will be assumed by the bankruptcy trustee~~ and ~~entitled~~certain toother ~~priority of payment~~factors.

~~Deposit~~The ~~Insurance~~FDIC –established ~~Substantially~~a ~~all~~plan ofon ~~the~~September ~~deposits~~15, of2020 ~~the~~to ~~Bank~~restore ~~are~~the ~~insured~~DIF upreserve ratio to ~~applicable~~meet ~~limits~~or byexceed the ~~Deposit~~statutory ~~Insurance~~minimum ~~Fund (“DIF”)~~ of ~~the~~1.35% ~~FDIC,~~within ~~and~~eight ~~the~~years. ~~Bank~~This isplan ~~subject~~did tonot ~~deposit~~include ~~insurance~~an ~~assessments~~increase toin ~~maintain~~ the ~~DIF.~~deposit ~~Deposit~~ insurance ~~assessments~~assessment ~~are~~rate. ~~based~~Based on ~~average~~the ~~consolidated~~FDIC’s ~~total~~recent ~~assets~~projections, ~~minus~~however, ~~average~~the ~~tangible~~FDIC ~~equity.~~determined ~~Under~~that the ~~FDIC’s~~DIF ~~risk-based~~reserve ~~assessment~~ratio ~~system,~~is ~~insured~~at ~~institutions~~risk ~~with~~of ~~less~~not ~~than~~reaching ~~$10~~the ~~billion~~statutory inminimum ~~assets,~~by ~~such as~~ the ~~Bank,~~statutory ~~are~~deadline ~~assigned~~of toSeptember ~~one~~30, of2028 ~~four~~without ~~risk~~increasing ~~categories~~the ~~based~~deposit oninsurance ~~supervisory~~assessment ~~evaluations,~~rates. ~~regulatory~~In ~~capital~~October ~~level~~2022, ~~and~~the ~~certain~~FDIC ~~other~~adopted ~~factors,~~a ~~with~~final ~~less~~rule ~~risky~~to ~~institutions~~increase ~~paying~~initial ~~lower~~base ~~assessments.~~deposit Aninsurance ~~institution’s~~ assessment rate ~~depends~~schedules ~~upon~~uniformly ~~the~~by ~~category~~2 tobasis ~~which~~points, itbeginning ison ~~assigned~~January ~~and~~1, ~~certain other factors~~2023.

In ~~October~~November ~~2022~~2023, the FDIC ~~adopted~~issued a final rule to ~~increase~~implement a special assessment to recover losses to the ~~initial~~DIF ~~base~~incurred ~~deposit~~as ~~insurance~~a result of bank failures in early 2023 and the FDIC's use of the systemic risk exception to cover certain deposits that were otherwise uninsured. The special assessment ~~rate~~was ~~schedules~~based ~~uniformly~~on byestimated 2uninsured ~~basis~~deposits ~~points~~as ~~beginning~~of ~~with~~December 31, 2022 (excluding the first $5.0 billion) and is being assessed at a quarterly rate of 3.36 basis points, over eight quarterly assessment ~~period~~periods, beginning in the first quarter of ~~2023~~2024. ~~The~~As ~~increased~~a ~~assessment~~result of this final rule, the Company is ~~expected~~not accruing expense related to ~~improve~~this ~~the~~assessment ~~likelihood~~based ~~that~~on the ~~DIF~~amount ~~reserve~~of ~~ratio~~uninsured ~~would~~deposits ~~reach~~at ~~the~~December ~~statutory~~31, ~~minimum~~2022 of 1less than $5.~~35%~~0 bybillion. Under the ~~statutory~~final ~~deadline~~rule, ~~prescribed~~the ~~under~~estimated loss pursuant to the systemic risk determination will be periodically adjusted, and the FDIC's ~~amended~~has ~~restoration~~retained ~~plan~~the ability to cease collection early, extend the special assessment collection period, and impose a final shortfall special assessment on a one-time basis.

In ~~November~~December ~~2023~~2025, ~~the~~based ~~FDIC~~upon ~~issued~~the afirst ~~final~~six ~~rule~~quarterly tocollections ~~implement~~of athe special assessment toand ~~recover~~anticipated ~~losses~~collections tofor the ~~DIF~~seventh ~~incurred~~quarterly asspecial aassessment, ~~result~~the ofFDIC ~~bank~~issued ~~failures~~an ininterim ~~early~~final ~~2023~~rule ~~and~~to amend the ~~FDIC's~~collection ~~use~~ of the ~~systemic~~special ~~risk~~assessment ~~exception~~ to ~~cover~~reduce ~~certain~~the ~~deposits~~eighth ~~that~~quarterly ~~were~~assessment ~~otherwise~~rate ~~uninsured~~from 3.36 ~~The~~basis ~~special~~points ~~assessment~~to ~~was~~2.97 ~~based~~basis onpoints. ~~estimated~~Because ~~uninsured~~the ~~deposits~~cumulative asamount ofcollected ~~December~~through ~~31,~~the ~~2022~~initial ~~(excluding~~eight ~~the~~quarter ~~first~~special ~~$5.0~~assessment ~~billion)~~period ~~and~~ is ~~being~~projected ~~assessed~~to atequal athe ~~quarterly~~FDIC’s ~~rate~~loss ofestimate, ~~3.36~~the ~~basis~~additional ~~points,~~two ~~over~~quarter ~~eight~~extension ~~quarterly~~of the assessment ~~periods,~~period ~~beginning~~was inremoved. ~~the~~The ~~first~~interim ~~quarter~~final ofrule ~~2024.~~also Asrequires athe ~~result~~FDIC ofto ~~this~~provide ~~final~~an ~~rule,~~offset ~~the~~to ~~Company~~regular isquarterly ~~not~~deposit ~~accruing~~insurance ~~expense~~assessments ~~related~~for institutions subject to ~~this~~the special assessment ~~based~~if on the aggregate amount ofcollected ~~uninsured~~exceeds ~~deposits~~estimated atlosses ~~December~~following ~~31,~~the ~~2022~~resolution of ~~less~~pending ~~than~~litigation, ~~$5.0~~and ~~billion.~~again ~~Under~~following the ~~final~~termination ~~rule,~~of ~~the~~any ~~estimated~~receiverships. ~~loss~~As ~~pursuant~~provided toin the ~~systemic~~special ~~risk~~assessment ~~determination~~rule, ~~will~~if belosses ~~periodically~~at ~~adjusted,~~the ~~and~~termination ~~the~~of ~~FDIC~~any ~~has~~receiverships ~~retained~~exceed the ~~ability~~amount tocollected, ~~cease~~the ~~collection~~FDIC ~~early,~~will ~~extend~~implement ~~the~~a one-time final shortfall special assessment ~~collection~~to ~~period,~~ensure ~~and~~the ~~impose~~full aamount ~~final~~of ~~shortfall~~actual ~~special~~losses ~~assessment~~is onrecovered aas ~~one-time~~required ~~basis~~by law. The extent to which any such ~~additional~~future offsets or a future ~~assessments~~one-time shortfall special assessment will impact the Company's future deposit insurance expense is currently uncertain.

FDIC insurance expense totaled $~~638~~628,000, $~~603~~638,000 and $~~415~~603,~~700~~000 for the years ended December 31, ~~2024~~2025, ~~2023~~2024 and ~~2022~~2023, respectively.

The FDIC may terminate deposit insurance upon a finding that the institution has engaged in unsafe and unsound practices, is in an unsafe or unsound condition to continue operations, or has violated any applicable law, regulation, rule, order or condition imposed by the FDIC.

Prompt Corrective Action – The Basel III Capital Rules incorporate new requirements into the prompt correction action framework, described above. The Federal Deposit Insurance Act (“FDIA”) requires that federal banking agencies take “prompt corrective action” against depository institutions that do not meet minimum capital requirements and includes the following five capital tiers: “well-capitalized,” “adequately capitalized,” “undercapitalized,” “significantly undercapitalized” and “critically undercapitalized.” A depository institution’s capital tier will depend upon how its capital levels compare with various relevant capital measures and certain other factors, as established by regulation.

A depository institution is deemed to be (i) “well-capitalized” if the institution has a total risk-based capital ratio of 10% or greater, a Tier 1 risk-based capital ratio of 8% or greater, a leverage ratio of 5% or greater, a common equity Tier 1 ratio of 6.5% or greater and is not subject to any regulatory order agreement or written directive to meet and maintain a specific capital level for any capital measure; (ii) “adequately capitalized” if the institution has a total risk-based capital ratio of 8% or greater, a Tier 1 risk-based capital ratio of 6% or greater, a leverage ratio of 4% or greater, a common equity Tier 1 ratio of 4.5% or greater and does not meet the definition of “well capitalized”; (iii) “undercapitalized” if the institution has a total risk-based capital ratio that is less than 8%, a Tier 1 risk-based capital ratio of less than 6%, a leverage ratio of less than 4% or a common equity Tier 1 ratio of less than 4.5%; (iv) “significantly undercapitalized” if the institution has a total risk-based capital ratio of less than 6%, a Tier 1 risk-based capital ratio of less than 4%, a leverage ratio of less than 3% or a common equity Tier 1 ratio of less than 3%; and (v) “critically undercapitalized” if the institution has a ratio of tangible equity (as defined in the regulations) to total assets that is equal to or less than 2%. An institution may be deemed to be in a capital category that is lower than indicated by its capital ratios if it is determined to be in an unsafe or unsound condition or if it receives an unsatisfactory examination rating with respect to certain matters. A bank’s capital category is

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equity (as defined in the regulations) to total assets that is equal to or less than 2%. An institution may be deemed to be in a capital category that is lower than indicated by its capital ratios if it is determined to be in an unsafe or unsound condition or if it receives an unsatisfactory examination rating with respect to certain matters. A bank’s capital category is determined solely for the purpose of applying prompt corrective action regulations, and the capital category may not constitute an accurate representation of the bank’s overall financial condition or prospects for other purposes.

Subject to a narrow exception, a receiver or conservator is required to be appointed for an institution that is “critically undercapitalized” within specified time frames. The regulations also provide that a capital restoration plan must be filed with the FRB within 45 days of the date an institution is deemed to have received notice that it is “undercapitalized,” “significantly undercapitalized” or “critically undercapitalized.” Compliance with the plan must be guaranteed by any parent holding company up to the lesser of 5% of the institution’s total assets when it was deemed to be undercapitalized or the amount necessary to achieve compliance with applicable capital requirements. In addition, numerous mandatory supervisory actions become immediately applicable to an undercapitalized institution including, but not limited to, increased monitoring by regulators and restrictions on growth, capital distributions and expansion. The FRB could also take any one of a number of discretionary supervisory actions, including the issuance of a capital directive and the replacement of senior executive officers and directors. Significantly and critically undercapitalized institutions are subject to additional mandatory and discretionary measures.

As of December 31, ~~2024~~2025, the most recent notification from the regulatory agencies categorized the Company and the Bank as well-capitalized. For further information regarding the capital ratios and leverage ratio of the Company and the Bank, see Item 8, Note 23 of this report.

Safety and Soundness Regulations – In accordance with the FDIA, the federal banking agencies adopted guidelines establishing general standards relating to internal controls, information systems, internal audit systems, loan documentation, credit underwriting, interest rate risk exposure, asset growth, asset quality, earnings, compensation, fees and benefits. In general, the guidelines require that institutions maintain appropriate systems and practices to identify and manage the risks and exposures specified in the guidelines. The guidelines prohibit excessive compensation as an unsafe and unsound practice and describe compensation as excessive when the amounts paid are unreasonable or disproportionate to the services performed by an executive officer, employee, director or principal shareholder. In addition, regulations adopted by the federal banking agencies authorize the agencies to require that an institution that has been given notice that it is not satisfying any of such safety and soundness standards to submit a compliance plan. If the institution fails to submit an acceptable compliance plan or fails in any material respect to implement an accepted compliance plan, the agency must issue an order directing corrective actions and may issue an order directing other actions of the types to which an undercapitalized institution is subject under the “prompt corrective action” provisions of FDIA. If the institution fails to comply with such an order, the agency may seek to enforce such order in judicial proceedings and to impose civil money penalties.

Loans-to-One-Borrower – The Bank generally may not make loans or extend credit to a single or related group of borrowers in excess of 15% of unimpaired capital and surplus. An additional amount may be loaned, up to 10% of unimpaired capital and surplus, if the loan is secured by readily marketable collateral, which generally does not include real estate. As of December 31, ~~2024~~2025, the Bank was in compliance with the loans-to-one-borrower limitations.

Depositor Preference – The FDIA provides that, in the event of the “liquidation or other resolution” of an insured depository institution, the claims of depositors of the institution, including the claims of the FDIC as subrogee of insured depositors, and certain claims for administrative expenses of the FDIC as a receiver, will have priority over other general unsecured claims against the institution. If an insured depository institution fails, insured and uninsured depositors, along with the FDIC, will have priority in payment ahead of unsecured, non-deposit creditors, including depositors whose deposits are payable only outside of the United States and the parent bank holding company, with respect to any extensions of credit they have made to such insured depository institution.

Community Reinvestment Act – The Community Reinvestment Act of 1977 (“CRA”) requires depository institutions to assist in meeting the credit needs of their market areas consistent with safe and sound banking practice. Under the CRA, each depository institution is required to help meet the credit needs of its market areas by, among other things, providing credit to low- and moderate-income individuals and communities. Depository institutions are periodically examined for compliance with the CRA and are assigned ratings that must be publicly disclosed. In order for a financial holding company to commence any new activity permitted by the BHC Act, or to acquire any company engaged in any new activity permitted by the BHC Act, each insured depository institution subsidiary of the financial holding company must ~~have received a rating of at least “satisfactory” in its most recent examination under the CRA. The Bank received a rating of “satisfactory” in its most recent CRA exam.~~

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Inhave ~~October~~received ~~2023, the OCC, together with the Federal Reserve and FDIC, issued~~ a ~~joint~~rating ~~final rule to modernize the CRA regulatory framework. The final rule is intended, among other things, to adapt to changes in the banking industry, including the expanded role~~ of ~~mobile~~at ~~and~~least ~~online~~“satisfactory” ~~banking, and to tailor performance standards to account for differences~~ in ~~bank~~its ~~size~~most ~~and~~recent ~~business~~examination ~~models. The final rule introduces new tests~~ under ~~which~~ the ~~performance of banks with over $2 billion in assets will be assessed~~CRA. The ~~new rule also includes data collection and reporting requirements, some of which are applicable only to banks larger than the~~ Bank ~~and~~received ~~updates~~a ~~the~~rating ~~definitions~~ of ~~community~~“satisfactory” ~~development~~in ~~and~~its ~~process~~most byrecent ~~which~~CRA ~~banks can seek approval of qualifying projects~~exam. ~~Most provisions of the final rule will become effective on January 1, 2026, and the data reporting requirements will become effective on January 1, 2027.~~

In October 2023, the Office of the Comptroller of the Currency ("OCC"), together with the Federal Reserve and FDIC, issued a joint final rule to modernize the CRA regulatory framework. The final rule is intended, among other things, to adapt to changes in the banking industry, including the expanded role of mobile and online banking, and to tailor performance standards to account for differences in bank size and business models. The final rule introduces new tests under which the performance of banks with over $2 billion in assets will be assessed. The new rule also includes data collection and reporting requirements, some of which are applicable only to banks larger than the Bank and updates the definitions of community development and process by which banks can seek approval of qualifying projects. Most provisions of the final rule became effective on January 1, 2026, and the data reporting requirements will become effective on January 1, 2027.

Financial Privacy – Banks and other financial institutions are subject to regulations that limit their ability to disclose non-public information about consumers to nonaffiliated third parties. These limitations require disclosure of privacy policies to consumers and affect how consumer information is transmitted through diversified financial companies and conveyed to outside vendors.

The Bank is also subject to regulatory guidelines establishing standards for safeguarding customer information and maintaining information security programs. The standards set forth in the guidelines are intended to ensure the security and confidentiality of customer records and information, protect against any anticipated threats or hazards to the security or integrity of such records and protect against unauthorized access to or use of such records or information that could result in substantial harm or inconvenience to any customer.

Transactions with Affiliates – Transactions between the Bank and its affiliates are subject to regulations that limit the types and amounts of covered transactions engaged in by the Bank and generally require those transactions to be on an arm’s-length basis. The term “affiliate” is defined to mean any company that controls or is under common control with the Bank and includes the Company and its non-bank subsidiaries. “Covered transactions” include a loan or extension of credit, as well as a purchase of securities issued by an affiliate, certain purchases of assets from the affiliate, certain derivative transactions that create a credit exposure to an affiliate, the acceptance of securities issued by the affiliate as collateral for a loan, and the issuance of a guarantee, acceptance or letter of credit on behalf of an affiliate. In general, these regulations require that any such transaction by the Bank (or its subsidiaries) with an affiliate must be secured by designated amounts of specified collateral and must be limited to certain thresholds on an individual and aggregate basis.

Federal law also limits the Bank’s authority to extend credit to its directors, executive officers and 10% shareholders, as well as to entities controlled by such persons. Among other things, extensions of credit to insiders are required to be made on terms that are substantially the same as, and follow credit underwriting procedures that are not less stringent than those prevailing for comparable transactions with unaffiliated persons. Also, the terms of such extensions of credit may not involve more than the normal risk of repayment or present other unfavorable features and may not exceed certain limitations on the amount of credit extended to such persons, individually and in the aggregate, which limits are based, in part, on the amount of the Bank’s capital.

Cybersecurity – Federal regulators regularly issue new and updated guidance and standards regarding cybersecurity intended to enhance cyber risk management among financial institutions and public companies generally. Financial institutions are expected to comply with such guidance and standards and develop appropriate risk management processes and security controls. If the Company fails to observe the regulatory guidance, it could be subject to various regulatory sanctions, including financial penalties.

~~Recently~~In November 2021, the federal banking agencies adopted a final rule requiring banking organizations to notify their primary banking regulator within 36 hours of determining that a “computer-security incident” has materially disrupted or degraded, or is reasonably likely to materially disrupt or degrade, the banking organization’s ability to carry out banking operations or deliver banking products and services to a material portion of its customer base, its businesses and operations that would result in material loss, or its operations that would impact the stability of the United States. Banking organizations are also required to notify each affected customer as soon as possible in the event of an incident that results in actual or potential harm to the integrity or availability of information and systems or that violates or threatens to violate the organization’s security for four or more hours.

Risks and exposures related to cybersecurity attacks, including litigation and enforcement risks, are expected to remain high for the foreseeable future due to the rapidly evolving nature and sophistication of these threats, as well as due to the expanding use of internet banking, mobile banking and other technology-based products and services by the Company and its customers. See Item 1A, “Risk Factors” for a further discussion of risks related to cybersecurity.

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~~Anti-Money~~Risks ~~Laundering Regulation~~ and ~~the~~exposures ~~USA~~related ~~PATRIOT~~to ~~Act~~cybersecurity -attacks, Aincluding ~~major~~litigation ~~focus of governmental policy on financial institutions in recent years has been aimed at combating money laundering~~ and ~~terrorist~~enforcement ~~financing. The Bank Secrecy Act (“BSA”)~~risks, ~~the~~are ~~USA~~expected ~~PATRIOT~~to ~~Act~~remain ofhigh ~~2021~~for (the ~~“USA~~foreseeable ~~PATRIOT~~future ~~Act”)~~due ~~and other laws and regulations require financial institutions, among other duties,~~ to ~~institute~~the ~~and~~rapidly ~~maintain~~evolving annature ~~effective Anti-Money Laundering (“AML”) program~~ and tosophistication ~~file~~of ~~timely~~these ~~reports~~threats, ~~such~~ as ~~suspicious~~well ~~activity~~as ~~reports~~due ~~and~~to ~~currency~~the ~~transaction~~expanding ~~reports~~use ~~that~~of ~~assist~~internet ~~government~~banking, ~~agencies~~mobile inbanking ~~detecting~~ and ~~preventing~~other ~~money~~technology-based ~~laundering.~~products ~~The USA PATRIOT Act prohibits financial institutions from entering into specified financial transactions~~ and ~~account~~services ~~relationships~~by ~~and requires that~~ the ~~institutions~~Company ~~implement customer identification programs~~ and ~~enhance~~its ~~due diligence procedures for certain high-risk~~ customers. ~~Regulatory~~See ~~authorities~~Item ~~routinely~~1A, ~~examine financial institutions for compliance with these obligations. The federal banking agencies and the Financial Crimes Enforcement Network (~~“~~FinCEN~~Risk Factors”) ~~are authorized to impose significant civil money penalties~~ for ~~violations~~a offurther ~~those~~discussion ~~requirements and have recently engaged in coordinated enforcement efforts against banks and other financial services providers with the Department~~ of ~~Justice,~~risks ~~Drug~~related ~~Enforcement Administration and Internal Revenue Service. The Company is also subject~~ to ~~increased scrutiny of compliance with the rules enforced by the Office of Foreign Assets Control~~cybersecurity.

Anti-Money Laundering - The Bank Secrecy Act, as amended by the Patriot Act and Anti-Money Laundering Act of 2020, ~~(“AMLA”)~~contains ~~amended~~anti-money ~~the~~laundering ~~BSA~~ and ~~was~~financial transparency provisions intended to bedetect aand ~~comprehensive~~prevent ~~reform~~the ~~and~~use ~~modernization~~of tothe U.S. ~~bank~~financial ~~secrecy~~system ~~and~~for ~~anti-~~money laundering ~~laws~~and terrorist financing activities. ~~Among~~The ~~other~~Bank ~~things,~~Secrecy itAct ~~codifies~~requires afinancial ~~risk-based~~institutions ~~approach~~such as depository institutions to ~~anti-money~~undertake ~~laundering~~activities, ~~compliance~~including ~~for~~maintaining ~~financial~~an ~~institutions;~~AML ~~requires~~program, verifying the ~~U.S.~~identity ~~Department~~ of customers, verifying the ~~Treasury~~identity toof ~~promulgate~~certain ~~priorities~~beneficial owners for ~~anti-money~~legal ~~laundering~~entity customers, monitoring for and ~~countering~~reporting ~~the~~suspicious ~~financing~~transactions, ofreporting ~~terrorism~~on ~~policy;~~cash ~~requires~~transactions ~~the~~exceeding ~~development~~specified ofthresholds, ~~standards~~and responding to requests for ~~testing~~information ~~technology~~by regulatory authorities and ~~internal~~law ~~processes~~enforcement ~~for~~agencies. ~~BSA~~The Company is subject to the Bank Secrecy Act and, therefore, is required to implement compliance; ~~expands~~policies, ~~enforcement-~~procedures, and ~~investigation-related~~internal ~~authority~~controls, ~~including~~provide ~~increasing~~its ~~available~~employees ~~sanctions~~with ~~for~~AML ~~certain~~training, ~~BSA~~designate ~~violations;~~an AML compliance officer, and ~~expands~~undergo ~~BSA~~periodic ~~whistleblower~~independent ~~incentives~~auditing and ~~protections.~~testing ~~Many~~to ofassess the ~~statutory~~effectiveness ~~provisions~~of inits ~~the~~AML ~~AMLA~~program, ~~will~~among ~~require~~other ~~additional~~requirements. ~~rulemakings~~The Company has implemented an AML compliance program, ~~reports~~including policies, procedures, and ~~other~~internal ~~measures~~controls that are designed to comply with these AML requirements. Bank regulators continue to focus their examinations on AML compliance, and the ~~impact~~Company ofwill ~~the~~continue ~~AMLA~~to ~~will~~monitor ~~depend~~and onaugment, ~~among~~where ~~other~~necessary, ~~things~~its AML compliance programs. The federal banking agencies are required, ~~rulemaking~~when reviewing bank and ~~implementation~~BHC ~~guidance~~acquisition or merger applications, to take into account the effectiveness of the AML activities of the applicant.

InThe ~~2021,~~Anti-Money ~~Congress~~Laundering ~~passed~~Act ~~the~~of ~~Corporate~~2020, ~~Transparency~~enacted ~~Act~~ as part of the National Defense Authorization Act, ~~which~~requires ~~enacted~~ the ~~most significant overhaul of the BSA and related AML laws since the USA PATRIOT Act~~U.S. ~~Notable~~Treasury ~~amendments include (i) significant changes~~ to ~~the~~issue ~~collection~~National ofAnti-Money ~~beneficial~~Laundering ~~ownership information~~ and Countering the ~~establishment~~Financing of aTerrorism ~~beneficial ownership registry~~Priorities, ~~which requires corporate entities (generally, any corporation, limited liability company or other similar entity with 20 or fewer employees~~ and~~/or~~ ~~annual~~conduct ~~gross~~studies ~~income of $5 million or less) to report beneficial ownership information to FinCEN (which information will be maintained by FinCEN~~ and ~~made~~issue ~~available~~regulations ~~upon~~that ~~request to certain government agencies and financial institutions); (ii) enhanced whistleblower provisions~~may, ~~which~~over ~~provide that one or more whistleblowers who voluntarily provide original information leading to~~ the ~~successful~~next ~~enforcement~~few ofyears, ~~violations~~significantly ofalter ~~the~~some ~~AML laws in any judicial or administrative action brought by the Secretary~~ of the ~~Treasury~~due ~~or the Attorney General resulting in monetary sanctions exceeding $1 million (including disgorgement and interest but excluding forfeiture~~diligence, ~~restitution~~recordkeeping, orand ~~compensation~~reporting torequirements ~~victims)~~that ~~will receive not more than 30 percent of~~ the ~~monetary~~Bank ~~sanctions~~Secrecy ~~collected~~Act ~~and~~imposes ~~will~~on ~~receive~~banks. ~~increased~~The ~~protections;~~Anti-Money ~~(iii)~~Laundering ~~increased~~Act ~~penalties for violations~~ of ~~the~~2020 ~~BSA;~~also ~~(iv)~~contains ~~improvements to existing information sharing~~ provisions that ~~permit~~promote ~~financial~~increased ~~institutions to share~~ information-sharing ~~relating to suspicious activity reports with foreign branches, subsidiaries,~~ and ~~affiliates~~use ~~(except those located in China, Russia, or certain other jurisdictions) for the purpose~~ of ~~combating~~technology ~~illicit finance risks;~~ and ~~(v)~~increases ~~expanded~~penalties ~~duties~~for ~~and~~violations ~~powers~~ of ~~FinCEN. Many of~~ the ~~requirements~~Bank ~~included~~Secrecy in the AML amendments will require additional rulemakings, reports and other measures, and the impact of these rules will depend on, among other things, rulemaking and implementation guidance. FinCEN proposed three rules to implement changes to the beneficial ownership requirements and related amendments set forth in the Corporate Transparency Act. ~~As of the date of this Form 10-K, two of the three have been finalized. The Beneficial Ownership Reporting Rule took effect on January 1, 2024~~ and ~~requires~~includes ~~certain~~whistleblower ~~domestic and foreign companies created~~incentives, orboth ~~registered to conduct business, in the United States to report beneficial ownership information to FinCEN. The Access Rule, effective as~~ of ~~February~~which ~~20,~~could ~~2024,~~increase ~~sets forth~~ the ~~circumstances~~prospect ~~under which FinCEN can disclose beneficial ownership information to authorized recipients and how FinCEN and recipients~~ of ~~the~~regulatory ~~data will protect that information~~enforcement. ~~It is expected that FinCEN will issue a third rule to revise existing customer due diligence requirements and bring them into conformance with the Corporate Transparency Act and the Access Rule.~~

Climate-Related Regulation and Guidance - In recent years the federal banking agencies have increased their focus on climate-related risks impacting the operations of banks, the communities they serve and the broader financial system. Accordingly, the agencies have begun to enhance their supervisory expectations regarding the climate risk management practices of larger banking organizations, including by encouraging such banks to: ensure that management of climate-related risk exposures has been incorporated into existing governance structures; evaluate the potential impact of climate-related risks on the bank’s financial condition, operations and business objectives as part of its strategic planning process; account for the effects of climate change in stress testing scenarios and systemic risk assessments; revise expectations for

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credit portfolio concentrations based on climate-related factors; consider investments in climate-related initiatives and lending to communities disproportionately impacted by the effects of climate change; evaluate the impact of climate change on the bank’s borrowers and consider possible changes to underwriting criteria to account for climate-related risks to mortgaged properties; incorporate climate-related financial risk into the bank’s internal reporting, monitoring and escalation processes; and prepare for the transition risks to the bank associated with the adjustment to a low-carbon economy and related changes in laws, regulations, governmental policies, technology, and consumer behavior and expectations.

In 2021, the OCC issued proposed principles for climate-related financial risk management for national banks with more than $100 billion in total assets. In 2022, the FDIC and FRB issued their own proposed principles for climate risk management by larger banking organizations. Although these risk management principles, if adopted as proposed, would not apply to the Bank directly based upon its current size, the regulators have indicated that all banks, regardless of their size, may have material exposures to climate-related financial and other risks that require prudent management. The federal banking agencies are expected to adopt a more formal climate risk management framework for larger banking organizations in the coming months. As climate-related supervisory guidance is considered and formalized for all banks and financial institutions, the Company may be required to expend significant capital and incur compliance, operating, maintenance and remediation costs in order to conform to such requirements.

Other Regulations – The operations of the Company and the Bank are also subject to:

•Truth-In-Lending Act, governing disclosures of credit terms to consumer borrowers;

•Fair Credit Reporting Act, governing the provision of consumer information to credit reporting agencies and the use of consumer information;

•Fair Debt Collection Act, governing the manner in which consumer debts may be collected by collection agencies;

•Electronic Funds Transfer Act, governing automatic deposits to and withdrawals from deposit accounts and customers’ rights and liabilities arising from the use of automated teller machines and other electronic banking services.

•Fair Housing Act, Home Mortgage Disclosure Act, and Real Estate Settlement Procedures Act, prohibiting discrimination against borrowers seeking housing and mortgages; requiring transparency and public reporting on mortgage and lending activities; and requiring that borrowers for mortgage loans for one- to four-family residential real estate receive various disclosures, including good faith estimates of settlement costs, lender servicing and escrow account practices, and prohibiting certain practices that increase the cost of settlement services;

•Equal Credit Opportunity Act, prohibiting discrimination on the basis of race, creed or other prohibited factors in extending credit;

•Check Clearing for the 21st Century Act (also known as “Check 21”), which gives “substitute checks,” such as digital check images and copies made from that image, the same legal standing as the original paper check.

Certain of these laws are consumer protection laws that extensively govern the Company’s relationship with its customers. Violations of applicable consumer protection laws can result in significant potential liability from litigation brought by customers, including actual damages, restitution and attorneys’ fees. Federal bank regulators, state attorneys general and state and local consumer protection agencies may also seek to enforce consumer protection requirements and obtain these and other remedies, including regulatory sanctions, customer rescission rights, action by the state and local attorneys general in each jurisdiction in which the Company operates and civil money penalties. Failure to comply with consumer protection requirements may also result in the Company’s inability to pursue merger or acquisition transactions.

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Website Availability of SEC Reports

Cass files annual, quarterly and current reports with the Securities and Exchange Commission (the “SEC”). Cass will, as soon as reasonably practicable after they are electronically filed with or furnished to the SEC, make available free of charge on its website each of its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, all amendments to those reports, and its definitive proxy statements. The address of Cass’ website is: www.cassinfo.com.

The reference to the Company’s website address does not constitute incorporation by reference of the information contained on the website and should not be considered part of this report.

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Statistical Disclosure by Bank Holding Companies

For the statistical disclosure by bank holding companies, refer to Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

ITEM 1A. RISK FACTORS

This section highlights specific risks that could affect the Company’s business. Although this section attempts to highlight key factors, please be aware that other risks may prove to be important in the future. New risks may emerge at any time, and Cass cannot predict such risks or estimate the extent to which they may affect the Company’s financial performance. InThis ~~addition~~section todescribes the Company’s beliefs regarding the factors ~~discussed~~that ~~elsewhere~~could ormaterially ~~incorporated~~and byadversely ~~reference~~affect inthe ~~this~~Company ~~report~~and its business, financial condition and results of operations in the ~~identified~~future. ~~risks~~All ~~that~~references ~~could~~to ~~cause~~past ~~actual~~events ~~results~~are intended to ~~differ~~be ~~materially~~examples ~~include~~only rather than a complete listing or a representation regarding whether such events have occurred in the ~~following:~~past or whether they are likely to occur in the future.

In addition to the factors discussed elsewhere or incorporated by reference in this report, the identified risks that could cause actual results to differ materially include the following:

Economic and Market Conditions Risk

~~Negative~~Risks ~~developments~~from ~~affecting~~fluctuating conditions in the ~~banking~~financial ~~industry,~~markets and ~~resulting~~economic ~~media~~and ~~coverage,~~political ~~can~~conditions ~~erode~~generally ~~customer~~affect ~~confidence in~~ the ~~banking system.~~Company

The ~~high-profile~~Company's ~~bank~~success ~~failures~~depends, ~~during~~to ~~2023~~a ~~generated~~certain ~~significant~~extent, ~~market~~upon ~~volatility~~local, national and global economic and political conditions, as well as governmental monetary policies. A favorable business environment is generally characterized by, among ~~publicly~~other ~~traded~~factors, ~~bank~~economic ~~holding~~growth, ~~companies~~efficient capital markets, low inflation, low unemployment, high business and investor confidence, and strong business earnings. ~~These~~Unfavorable or uncertain economic and market ~~developments~~conditions ~~negatively~~can ~~impacted~~be ~~customer~~caused ~~confidence~~by a decline in economic growth both in the ~~safety~~U.S. and ~~soundness~~internationally; declines in business activity or investor or business confidence; limitations on the availability of ~~regional~~or ~~banks.~~increases Asin the cost of credit and capital; increases in inflation or interest rates; high unemployment; oil price volatility; natural disasters; trade policies and tariffs; or a ~~result~~combination of these or other factors. In addition, ~~customers~~financial markets and global supply chains may ~~choose~~be toadversely ~~maintain~~affected ~~deposits~~by ~~with~~the ~~larger~~current ~~financial~~or ~~institutions~~anticipated impact of global wars/military conflicts, terrorism or ~~invest~~other ingeopolitical ~~higher~~events. ~~yielding~~Current ~~short-term~~economic ~~fixed~~conditions ~~income~~are ~~securities~~being heavily impacted by recent inflationary conditions and higher interest rates, ~~all~~the effects of which ~~could~~may ~~materially adversely~~ impact the Company’'s ~~liquidity,~~profitability ~~loan~~by ~~funding~~negatively ~~capacity~~impacting its fixed costs and expenses. Economic and inflationary pressure on consumers and uncertainty regarding economic improvement could result in changes in consumer and business spending, ~~net~~borrowing ~~interest~~and ~~margin~~savings habits. Such conditions could have a material adverse effect on the credit quality of the Company's loans and its business, ~~capital~~financial condition and results of operations.

~~Increased~~Federal ~~regulatory~~budget ~~examination~~deficit ~~scrutiny~~concerns orand ~~new~~the ~~regulatory~~potential ~~requirements~~for ~~arising~~political ~~from~~conflict over legislation to fund U.S. government operations and raise the ~~recent~~U.S. ~~events~~government's debt limit may increase the possibility of a default by the U.S. government on its debt obligations, related credit-rating downgrades, or an economic recession in the ~~banking~~United ~~industry~~States. ~~could~~Many ~~increase~~of the Company’'s ~~expenses~~investment securities are issued by the U.S. government and ~~affect~~government agencies and sponsored entities. As a result of uncertain domestic political conditions, including potential future federal government shutdowns, the ~~Company’~~possibility of the federal government defaulting on its obligations for a period of time due to debt ceiling limitations or other unresolved political issues, investments in financial instruments issued or guaranteed by the federal government pose liquidity risks. Most recently, in connection with successive failures by the U.S. government to reverse the trend of large annual fiscal deficits and growing interest costs, Moody's ~~operations~~lowered its long-term issuer credit rating on the U.S. from Aaa to Aa1. A further downgrade, or downgrades by other rating agencies, as well as sovereign debt issues facing the governments of

Increased regulatory scrutiny and new regulations designed to address the high profile bank failures in 2023 may increase the Company’s costs of doing business and reduce its profitability. Among other things, there may be an increased focus by regulators on deposit composition and the level of uninsured deposits. As primarily a commercial bank, the Bank has a higher degree of uninsured deposits compared to larger national banks or smaller community banks with a stronger focus on retail deposits. As a result, the Bank could face increased scrutiny or be viewed as higher risk.10

~~General~~Table ~~political,~~of ~~economic or industry conditions may be less favorable than expected.~~Contents

~~Local,~~other ~~domestic~~countries, ~~and~~could ~~international~~have ~~economic,~~a ~~political~~material ~~and~~adverse ~~industry-specific~~impact ~~conditions~~on ~~and~~financial ~~governmental~~markets ~~monetary~~ and ~~fiscal~~economic ~~policies~~conditions ~~affect the industries~~ in ~~which~~ the ~~Company competes, directly and indirectly~~U.S. Conditions such as inflation, recession, unemployment, volatile interest rates, tight money supply, real estate values, international conflicts, global pandemics, natural disasters, risks related to climate change, and ~~other factors outside of Cass’ control may adversely affect the Company~~worldwide. ~~Economic downturns could result in the delinquency of outstanding loans, which could have a material adverse impact on Cass’ earnings.~~

Certain events beyond the Company’s control, such as severe weather, natural disasters, terrorist activities or other hostilities, may adversely affect the general economy, financial and capital markets, specific industries, and the Company.

Severe weather, natural disasters, acts of terrorism or other hostilities, and other adverse external events beyond the Company’s control, could have a significant impact on the Company’s ability to conduct business. Such events could disrupt the Company's operations or those of its customers, affect the stability of the Company’s deposit base, impair the ability of borrowers to repay outstanding loans, impair the value of collateral securing loans, cause significant property damage, result in loss of revenue and/or cause the Company to incur additional expenses. The occurrence of any such event in the future could have a material adverse effect on the Company’s business, which, in turn, could have a material adverse effect on the Company’s financial condition and results of operations.

Credit and Interest Rate Risks

Unfavorable developments concerning customer credit quality could affect Cass’ financial results.

Although the Company regularly reviews credit exposure related to its customers and various industry sectors in which it has business relationships, default risk may arise from events or circumstances that are difficult to detect or foresee. Under such circumstances, the Company could experience an increase in the level of provision for credit losses, delinquencies, nonperforming assets, net charge-offs and allowance for credit losses.

~~Fluctuations~~The inCompany’s ~~interest~~allowance ~~rates~~for ~~could~~credit ~~affect~~losses ~~Cass’~~(“ACL”) ~~net~~is ~~interest~~subject ~~income~~to continuing evaluation and ~~balance~~may ~~sheet~~be insufficient.

The ~~operations~~Company ofmaintains ~~financial~~an ~~institutions~~ACL, ~~such~~which asis ~~the~~a ~~Company~~reserve ~~are~~established ~~dependent~~through a provision for credit losses charged to expense. The ACL is a ~~large~~valuation ~~degree~~account onthat is deducted from the amortized cost basis to present the net ~~interest~~amount ~~income~~expected to be collected on loans. Management uses a systematic, ~~which~~documented isapproach in determining the ~~difference~~appropriate ~~between~~level ~~interest~~of ~~income~~ACL, ~~from~~which represents management’s estimate of losses in loans and ~~investments~~off-balance sheet exposures as of the balance sheet date. Management estimated the allowance balance using relevant available information relating to internal and ~~interest~~external ~~expense~~factors, onpast ~~deposits~~events, current conditions and ~~borrowings.~~reasonable ~~Prevailing~~and supportable forecasts based on economic ~~conditions~~sources, ~~the~~such ~~fiscal~~as ~~and~~Gross ~~monetary~~Domestic ~~policies~~Product (“GDP”). Historical credit loss experience, of both the ~~federal~~Company ~~government~~ and similar peer banks, provides the ~~policies~~basis offor ~~various~~the ~~regulatory~~estimation ~~agencies~~of ~~all~~expected ~~affect~~credit ~~market~~losses. ~~rates~~Adjustments ofto ~~interest,~~historical ~~which~~loss ininformation ~~turn~~are ~~significantly~~made ~~affect~~for ~~financial~~asset ~~institutions~~quality trends, borrower’s ~~net~~ability ~~interest~~to ~~income~~pay, collateral, and other environmental factors. ~~Fluctuations~~The inACL ~~interest~~is ~~rates~~measured ~~affect~~on ~~Cass’~~a ~~financial~~collective ~~statements,~~pool asbasis ~~they~~when dosimilar risk characteristics exist. The determination of the appropriate level of the allowance for ~~all~~credit ~~financial~~losses ~~institutions~~inherently involves a high degree of subjectivity and requires management to make estimates based on risks and trends that are subject to material change. ~~Volatility~~A deterioration in economic conditions, including any recession, affecting borrowers and securities issuers; inflation; rising interest rates; ~~can~~new ~~also~~information ~~result~~regarding inexisting ~~disintermediation~~loans, ~~which~~credit iscommitments ~~the~~and ~~flow~~securities ofholdings; ~~funds~~global ~~away~~pandemics; ~~from~~geopolitical ~~financial~~and ~~institutions~~economic ~~into~~conditions; ~~direct~~natural ~~investments,~~disasters ~~such~~and asrisks ~~federal~~related ~~government~~to climate change; and ~~corporate~~identification ~~securities~~of problem loans, ratings down-grades and other ~~investment vehicles~~factors, ~~which,~~both ~~because~~within and outside of the ~~absence~~Company’s ofcontrol, ~~federal~~may ~~insurance~~require ~~premiums~~an ~~and~~increase ~~reserve~~in ~~requirements,~~the ~~generally~~allowances ~~pay~~for ~~higher~~credit ~~rates~~losses ofon ~~return~~loans, ~~than~~investment ~~financial~~securities and off-balance sheet credit exposures.

The determination and application of the ACL accounting policy involves judgments, estimates, and uncertainties that are subject to change. Changes in these assumptions, estimates or the conditions surrounding them may have a material impact on the Company’s financial condition, liquidity or results of operations. Various regulatory agencies, as an integral part of the examination process, periodically review the ACL. Such agencies may require the Company to recognize additions to the ACL or reserve increases to adversely graded classified loans based on information available to them at the time of their examinations.

The application of the model used to determine the ACL could result in volatility in earnings. Additionally, if charge-offs in future periods exceed the ACL, the Company will need additional provisions to increase the ACL. Any increases in the ACL will result in a decrease in net income and, possibly, capital, and may have a material adverse effect on the Company’s business, financial condition and results of operations.

See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Provision and Allowance for Credit Losses on Loans and Allowance for Unfunded Commitments” and Item 8, “Financial Statements and Supplementary Data—Note 1” for additional information.

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~~institutions.~~Fluctuations ~~Due~~ in ~~part to a higher market~~ interest ~~rate~~rates ~~environment~~could inaffect ~~recent~~Cass’ ~~periods, the Company's~~ net interest ~~margin has increased to 3.42% in 2024 from 3.25% in 2023, 2.74% in 2022 and 2.31% in 2021, therefore increasing net interest~~ income. ~~As discussed in greater detail in Item 7A, “Quantitative~~ and ~~Qualitative~~balance ~~Disclosures about Market Risk,” a decline in market interest rates would be expected to have a negative impact on the Company’s net interest income~~sheet.

The ~~value~~operations of ~~our~~financial ~~goodwill~~institutions such as the Company are dependent to a large degree on net interest income, which is the difference between interest income from loans and investments and interest expense on deposits and borrowings. Prevailing economic conditions, the fiscal and monetary policies of the federal government and the policies of various regulatory agencies all affect market rates of interest, which in turn significantly affect financial institutions’ net interest income. Fluctuations in interest rates affect Cass’ financial statements, as they do for all financial institutions. Volatility in interest rates can also result in disintermediation, which is the flow of funds away from financial institutions into direct investments, such as federal government and corporate securities and other ~~intangible~~investment ~~assets~~vehicles, ~~may~~which, because of the absence of federal insurance premiums and reserve requirements, generally pay higher rates of return than financial institutions. Due in part to a higher market interest rate environment in recent years, the Company's net interest margin has increased to 3.83% in 2025 from 3.42% in 2024, 3.25% in 2023 and 2.74% in 2022, therefore increasing net interest income. Notwithstanding these recent increases, as discussed in greater detail in Item 7A, “Quantitative and Qualitative Disclosures about Market Risk,” a decline in market interest rates would be expected to have a negative impact on the ~~future~~Company’s net interest income.

As of December 31, 2024, the Company had $26.4 million of goodwill and other intangible assets. A significant decline in the Company's expected future cash flows, a significant adverse change in the business climate, slower growth rates or a significant and sustained decline in the price of the Company's common stock may necessitate taking charges in the future related to the impairment of goodwill and other intangible assets which could have a material adverse effect on the Company's business, financial condition and results of operations.

In certain circumstances, Cass remits payment of invoices prior to receiving funds from its customers. As such, Cass could experience losses if such funds are not received from customers after payment is remitted.

Although the Company regularly reviews credit exposure related to its customers and various industry sectors in which it has business relationships, default risk may arise from events or circumstances that are difficult to detect or foresee. Under such circumstances, the Company could experience losses related to funds remitted for payment to freight carriers, utility companies and other such companies, prior to receiving funds from its customers.

The Company has lending concentrations, including, but not limited to, faith-based ministries located in selected cities, franchise restaurants, and privately-held businesses located in or near St. Louis, Missouri, that could suffer a significant decline which could adversely affect the Company.

Cass’ customer base consists, in part, of lending concentrations in several segments and geographical areas. If any of these segments or areas is significantly affected by weak economic conditions, the Company could experience increased credit losses, and its business could be adversely affected.

~~Operations~~Rising ofinterest ~~the~~rates ~~Company’s~~have ~~customer~~decreased ~~base~~the ~~are~~value ~~impacted~~of bythe ~~macro~~Company’s available-~~economic~~for-sale ~~factors~~investment ~~such~~securities asportfolio, ~~a strong dollar~~ and~~/or~~ ~~volatility~~the inCompany ~~commodity~~would ~~prices.~~realize Alosses ~~reduction~~if init ~~its~~were ~~customers’~~required ~~operations~~to ~~could~~sell ~~have~~such ainvestment ~~material~~securities ~~adverse~~to ~~effect~~meet onliquidity ~~Cass’ results of operations~~needs.

AAs ~~decline~~a inresult ~~the cost~~ of ~~oil~~inflationary ~~worldwide~~pressures ~~can~~and ~~have~~resulting ahigher ~~negative~~interest ~~effect~~rates, ~~on both~~ the ~~number~~fair value of ~~freight~~previously ~~transactions~~issued ~~processed~~government and ~~the~~other ~~dollar~~fixed ~~amount~~income ofinvestment ~~invoices~~securities ~~processed.~~has ~~For~~declined ~~example~~significantly, ~~lower~~resulting ~~oil~~in ~~prices~~unrealized ~~can~~losses. ~~cause~~If athe ~~significant~~Company ~~drop~~were inrequired ~~drilling~~to ~~supplies~~sell ~~being~~such ~~transported~~investment securities to ~~fracking~~meet ~~operations~~liquidity byneeds, ~~domestic~~it ~~railroads~~may ~~and~~incur ~~trucks.~~losses, ~~Lower~~which ~~oil~~could ~~prices~~impair ~~can~~the ~~also~~Company’s ~~result~~capital, infinancial ~~lower~~condition, ~~gas~~ and ~~fuel~~results ~~prices,~~of ~~negatively~~operations ~~affecting~~and require the ~~dollar~~Company ~~amounts~~to ofraise ~~the~~additional ~~invoices~~capital ~~that~~on ~~Cass~~unfavorable ~~processes~~terms, ~~for~~thereby negatively impacting its ~~freight~~profitability. ~~and~~While ~~shipping~~the ~~customers.~~Company Ahas ~~decline~~taken inactions ~~oil~~to ~~prices~~maximize ~~could~~its ~~have~~funding ansources, ~~adverse~~there ~~effect~~is onno ~~the~~guarantee ~~Company’s~~that ~~revenues~~such ~~and~~actions ~~could~~will ~~significantly~~be ~~impact~~successful ~~its~~or ~~results~~sufficient in the event of ~~operations~~sudden liquidity needs.

Business Operations and Strategic Risk

~~Operational~~Cass ~~difficulties~~uses orAI ~~cybersecurity~~in ~~problems~~connection ~~could~~with ~~damage~~its ~~Cass’~~business ~~reputation~~ and ~~business~~operations, which exposes the Company to inherent risks that may expose it to material harm.

InThe ~~the ordinary course of business, the~~ Company ~~depends~~uses onAI ~~the~~in ~~reliable~~connection ~~operation~~with of its ~~computer~~business and operations, ~~and~~including ~~network~~through ~~connections~~the ~~from~~models ~~its~~it ~~clients~~employs. toAI ~~its~~is ~~systems.~~complex ~~Any~~and ~~failure,~~rapidly ~~interruption~~evolving, orand ~~breach~~the inintroduction ~~security~~ of ~~these~~AI, ~~systems~~a ~~would~~relatively ~~cause~~new ~~Cass~~and toemerging betechnology ~~unable~~in tothe ~~process~~early ~~transactions~~stages ~~for~~of ~~its~~commercial ~~clients~~use, ~~resulting~~into inthe ~~decreased revenues. The~~ Company's ~~also~~business ~~relies~~and onoperations ~~electronic~~may ~~communications~~subject ~~and~~it ~~information systems~~ to ~~store~~new ~~sensitive~~or ~~customer~~heightened ~~data.~~legal, ~~Any~~regulatory, ~~failure~~ethical, ~~interruption~~operational, ~~breach~~reputational, ~~in security~~ or ~~loss~~other ofrisks. ~~data,~~The ~~whatever~~models ~~the~~underlying ~~cause,~~AI ~~could~~may ~~reduce~~be ~~client~~incorrectly ~~satisfaction~~or ~~with~~inadequately ~~the~~designed ~~Company’s~~or ~~products~~implemented and ~~services~~trained ~~and~~on, ~~harm~~or ~~Cass’~~otherwise ~~financial~~use, ~~results.~~data ~~These~~or ~~types~~algorithms ofthat ~~threats~~are, ~~may~~and ~~derive~~output ~~from~~that ~~human~~may ~~error~~be, ~~fraud~~incomplete, orinadequate, ~~malice~~misleading, onbiased, ~~the~~poor-quality ~~part of external~~ or ~~internal~~otherwise ~~parties~~flawed, orany ~~may~~of ~~result~~which ~~from~~may ~~accidental~~not ~~technological~~be ~~failure~~easily detectable. Further, toinappropriate ~~access~~or ~~the~~controversial ~~Company’s~~data ~~products~~practices ~~and~~by ~~services,~~developers ~~Cass’ customers may use computers~~ and ~~mobile~~end-users ~~devices~~or ~~that~~other ~~are~~factors ~~beyond~~adversely ~~the~~affecting ~~Company’s~~public ~~security~~opinion ~~control~~of ~~systems.~~AI ~~The~~could ~~Company’s~~impair ~~technologies,~~the ~~systems,~~acceptance ~~networks~~of ~~and software~~AI, ~~and~~including those ofincorporated ~~other~~in ~~financial~~the ~~institutions~~Company's ~~have~~business ~~been,~~ and ~~are~~operations. ~~likely~~If tothe ~~continue~~AI tothat ~~be,~~Cass ~~the~~uses ~~target~~is ofdeficient, ~~cybersecurity~~inaccurate ~~threats~~or ~~and attacks~~controversial, ~~which~~the ~~may~~Company ~~range~~could ~~from~~incur ~~uncoordinated~~operational ~~individual~~inefficiencies, ~~attempts~~competitive toharm, ~~sophisticated~~legal and ~~targeted~~regulatory ~~measures~~action, ~~directed~~brand ator ~~Cass.~~reputational ~~In addition~~harm, ~~the~~or ~~rapid~~other ~~evolution~~adverse ofimpacts ~~artificial~~on ~~intelligence~~its ~~technologies~~business ~~may~~and ~~intensify~~financial ~~our cybersecurity risks~~results. ~~The risk of a security breach or disruption~~Further, ~~particularly~~there ~~through~~can ~~cyber-attack~~be orno ~~cyber~~assurance ~~intrusion,~~that ~~has~~the ~~increased~~Company's asuse ~~the~~of ~~number,~~AI ~~intensity~~will ~~and~~be ~~sophistication~~successful ofin ~~attempted~~enhancing ~~attacks~~its ~~and~~business ~~intrusions~~or ~~from~~operations, be

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~~around~~successfully ~~the~~adopted ~~world~~and ~~have~~deployed ~~increased.~~by Aits ~~material~~colleague ~~security~~base, ~~problem~~or ~~affecting~~otherwise ~~Cass~~result ~~could~~in ~~damage~~ its ~~reputation~~intended outcomes, ~~deter~~and ~~prospects~~the ~~from~~Company's ~~purchasing~~competitors ~~its~~may ~~products~~incorporate ~~and~~AI ~~services,~~into ~~deter~~their ~~customers~~businesses ~~from~~or ~~using~~operations ~~its~~more ~~products~~quickly ~~and services~~ or ~~result~~more insuccessfully ~~liability~~than to Cass.

AI and the use thereof is also subject to a variety of existing laws and regulations, including fair lending, consumer protection, intellectual property, cybersecurity, data privacy, and equal opportunity, and is expected to be subject to new laws and regulations or new applications of existing laws and regulations. AI is the subject of evolving review by various governmental and regulatory agencies, and changes in laws and regulations governing AI may adversely affect the Company's ability to use AI. Additionally, various federal, state and foreign governments and regulators have implemented, or are considering implementing, general legal and regulatory frameworks for the appropriate use of AI. It is possible that the Company will not be able to anticipate how to respond to these rapidly developing laws and regulations. Further, if the Company does not have sufficient rights to use the data or algorithms on which its AI solutions rely or the output generated thereby, it also may incur liability through the violation of applicable laws and regulations, such as fair lending laws and regulations, third-party intellectual property, privacy or other rights, or contracts to which the Company is a party. The Company may not be able to sufficiently mitigate or detect any of the foregoing risks or concerns given its and other market participants’ lack of experience with using AI, the pace of technological change, and rapid adoption of AI by its business partners and competitors. Any actual or perceived failure to address risks or concerns relating to the use of AI, whether unfounded or not, could adversely affect the Company's business and operations.

The Company is exposed to risks associated with the handling of customer funds.

The Company makes payments of approximately $94 billion on an annual basis on behalf of its customers. Consequently, at any given time, the Company may be holding or directing funds of transportation, facility, CassPay and Bank customers. This function creates a risk of loss arising from, among other things, fraud by employees or third parties, execution of unauthorized transactions, ACH reversals, or errors relating to transaction processing. The occurrence of any of these types of events could cause the Company financial loss and reputational harm.

The Company may be adversely impacted by changing oil and overall energy prices.

A decline in the cost of oil worldwide can have a negative effect on both the number of freight transactions processed and the dollar amount of invoices processed. For example, lower oil prices can cause a significant drop in drilling supplies being transported to fracking operations by domestic railroads and trucks. Lower oil prices can also result in lower gas and fuel prices, negatively affecting the dollar amounts of the invoices that Cass processes for its freight and facility customers. In addition, a decline in the price of electricity would also result in lower dollars processed for facility customers. As such, a decline in oil and overall energy prices could have an adverse effect on the Company’s revenues in the form of net interest income and financial fees, and significantly impact its results of operations.

The Company may be adversely impacted by changing freight rates.

The Company is exposed to changes in freight rates, which impact the overall level of accounts and drafts payable, payments in advance of funding and resulting interest income and financial fees. Freight rates are highly sensitive to many factors, including carrier capacity, economic conditions, and other factors beyond the Company's control. A decline in freight rates would be expected to have an adverse effect on the Company's revenues and could significantly impact its result of operations.

Interruptions or performance problems associated with the Company's network technology and infrastructure may adversely affect its business and operating results.

The Company has experienced, and may in the future experience, disruptions, outages, and other performance problems related to its payments platform due to a variety of factors, including infrastructure changes, introductions of new functionality (including functionality that incorporates artificial intelligence tools), human or software errors, denial-of-service attacks, actions or inactions attributable to third parties, earthquakes, hurricanes, floods, fires, natural disasters, power losses, disruptions in telecommunications services, fraud, military or political conflicts, terrorist attacks and other geopolitical unrest, computer viruses, ransomware, malware, or other events. The Company's systems also may be subject to break-ins, sabotage, theft, and intentional acts of vandalism, including by its own employees. Some of the Company's systems are not fully redundant and disaster recovery planning may not be sufficient for all eventualities.

Occasionally, the Company may experience limited periods of server downtime due to server failure or other technical difficulties. In some instances, the Company may not be able to identify the cause or causes of these performance problems

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within an acceptable period of time. It may become increasingly difficult to maintain and improve its performance, especially during peak usage times. If the platform is unavailable or if the Company's users are unable to access the Company's platform within a reasonable amount of time, or at all, the Company's business would be adversely affected and its brand could be harmed. In the event of any of the factors described above, or certain other failures of the Company's infrastructure, customer data may be permanently lost and Cass could experience significant losses of revenue.

To the extent that the Company does not effectively address capacity constraints, upgrade systems as needed, and continually develop its payments technology and network architecture to accommodate actual and anticipated changes in technology, the Company's business and operating results may be adversely affected.

Operational difficulties or cybersecurity problems could damage Cass’ reputation and business.

In the ordinary course of business, the Company depends on the reliable operation of its computer operations and network connections from its clients to its systems. Any failure, interruption, or breach in security of these systems would cause Cass to be unable to process transactions for its clients, resulting in decreased revenues. The Company also relies on electronic communications and information systems to store sensitive customer data. Any failure, interruption, breach in security or loss of data, whatever the cause, could reduce client satisfaction with the Company’s products and services, cause reputational harm, and harm Cass’ financial results. These types of threats may derive from human error, fraud or malice on the part of external or internal parties, or may result from accidental technological failure. Further, to access the Company’s products and services, Cass’ customers may use computers and mobile devices that are beyond the Company’s security control systems. The Company’s technologies, systems, networks and software, and those of other financial institutions have been, and are likely to continue to be, the target of cybersecurity threats and attacks, which may range from uncoordinated individual attempts to sophisticated and targeted measures directed at Cass. The risk of a security breach or disruption, particularly through cyber-attack or cyber intrusion, has increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased. Criminals continuously adapt their methods to circumvent existing safeguards, and emerging technologies such as artificial intelligence may further enhance their ability to perpetrate fraud. A material security problem affecting Cass could damage its reputation, deter prospects from purchasing its products and services, deter customers from using its products and services or result in liability to Cass.

Cloud technologies are also critical to the operation of the Company's systems, and reliance on cloud technologies is growing. Service disruptions in cloud technologies may lead to delays in accessing, or the loss of, data that is important to the Company's businesses and may hinder customers access to products and services.

Although the Company makes significant efforts to maintain the security and integrity of Cass’ information systems and ~~have~~has implemented various measures to manage the risk of a security breach or disruption, there can be no assurance that Cass’ security efforts and measures will be effective or that attempted security breaches or disruptions would not be successful or damaging. Even the most well protected information, networks, systems and facilities remain potentially vulnerable because attempted security breaches, particularly cyber-attacks and intrusions, or disruptions will occur in the future, and because the techniques used in such attempts are constantly evolving and generally are not recognized until launched against a target, and in some cases are designed not to be detected and, in fact, may not be detected. Accordingly, the Company may be unable to anticipate these techniques or to implement adequate security barriers or other preventative measures, and thus it is virtually impossible to entirely mitigate this risk. While specific “cyber” insurance coverage is maintained, which would apply in the event of various breach scenarios, the amount of coverage may not be adequate in any particular case. Furthermore, because cyber threat scenarios are inherently difficult to predict and can take many forms, some breaches may not be covered under Cass’ cyber insurance coverage. A security breach or other significant disruption of Cass’ information systems or those related to customers, merchants and third-party vendors, including as a result of cyber-attacks, could (i) disrupt the proper functioning of Cass’ networks and systems and therefore operations and/or those of certain customers; (ii) result in the unauthorized access to, and destruction, loss, theft, misappropriation or release of confidential, sensitive or otherwise valuable information of the Company or its customers; (iii) result in a violation of applicable privacy, data breach and other laws, subjecting the Company to additional regulatory scrutiny and expose Cass to civil litigation, governmental fines and possible financial liability; (iv) require significant management attention and resources to remedy the damages that result; or (v) harm Cass’ reputation or cause a decrease in the number of customers that choose to do business with the Company. The occurrence of any of the foregoing could have a material adverse effect on Cass’ business, financial condition and results of operations.

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Cass must respond to rapid technological changes and these changes may be more difficult or expensive than anticipated.

If competitors introduce new products and services embodying new technologies, ~~including~~such as those ~~supported~~related byto artificial intelligence, more quickly or more successfully than the Company, or if new industry standards and practices emerge, the Company’s existing product and service offerings, technology and systems may become obsolete. Further, if Cass fails to adopt or develop new technologies, ~~including those supported by artificial intelligence,~~ or to adapt its products and services to emerging industry standards, Cass may lose current and future customers. Finally, Cass’ ability to adopt these technologies can also be inhibited by intellectual property rights of third parties. Any of these could have a material adverse effect on its business, financial condition and results of operations. The payment processing and financial services industries are changing rapidly and in order to remain competitive, Cass must continue to enhance and improve the functionality and features of its products, services and technologies. These changes may be more difficult or expensive than the Company anticipates.

Methods of reducing risk exposures might not be effective.

Instruments, systems and strategies used to hedge or otherwise manage exposure to various types of credit, interest rate, market and liquidity, operational, regulatory/compliance, business risks and enterprise-wide risks could be less effective than anticipated. As a result, the Company may not be able to effectively mitigate its risk exposures in particular market environments or against particular types of risk.

Customer borrowing, repayment, investment, deposit, and payable processing practices may be different than anticipated.

The Company uses a variety of financial tools, models and other methods to anticipate customer behavior as part of its strategic and financial planning and to meet certain regulatory requirements. Individual, economic, political and industry-specific conditions and other factors outside of Cass’ control could alter predicted customer borrowing, repayment, investment, deposit, and payable processing practices. Such a change in these practices could adversely affect Cass’ ability to anticipate business needs, including cash flow and its impact on liquidity, and to meet regulatory requirements.

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The Company’s allowance for credit losses (“ACL”) is subject to continuing evaluation and may be insufficient.

The Company maintains an ACL, which is a reserve established through a provision for credit losses charged to expense. The ACL is a valuation account that is deducted from the amortized cost basis to present the net amount expected to be collected on loans. Management uses a systematic, documented approach in determining the appropriate level of ACL, which represents management’s estimate of losses in loans and off-balance sheet exposures as of the balance sheet date. Management estimated the allowance balance using relevant available information from internal and external factors, relating to past events, current conditions and reasonable and supportable forecasts based on economic sources, such as Gross Domestic Product (“GDP”). Historical credit loss experience, of both the Company and similar peer banks, provides the basis for the estimation of expected credit losses. Adjustments to historical loss information are made for asset quality trends, borrower’s ability to pay, collateral, and other environmental factors. The ACL is measured on a collective pool basis when similar risk characteristics exist. The determination of the appropriate level of the allowance for credit losses inherently involves a high degree of subjectivity and requires management to make estimates based on risks and trends that are subject to material change. Continuing deterioration in economic conditions, including the possibility of a recession, affecting borrowers and securities issuers; inflation; rising interest rates; new information regarding existing loans, credit commitments and securities holdings; global pandemics; natural disasters and risks related to climate change; and identification of problem loans, ratings down-grades and other factors, both within and outside of the Company’s control, may require an increase in the allowances for credit losses on loans, securities and off-balance sheet credit exposures.

See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Provision and Allowance for Credit Losses and Unfunded Commitments” and Item 8, “Financial Statements and Supplementary Data—Note 1” for additional information.

Competitive product and pricing pressure within Cass’ markets may change.

The Company operates in a very competitive environment, which is characterized by competition from a number of other vendors and financial institutions in each market in which it operates. The Company competes with large payment processors and national and regional financial institutions and also smaller auditing companies and banks in terms of products and pricing. If the Company is unable to compete effectively in products and pricing in its markets, business could decline.

Management’s ability to maintain and expand customer relationships may differ from expectations.

The industries in which the Company operates are very competitive. The Company not only competes for business opportunities with new customers, but also competes to maintain and expand the relationships it has with its existing customers. The Company continues to experience pressures to maintain these relationships as its competitors attempt to capture its customers.

The introduction, withdrawal, success and timing of business initiatives and strategies, including, but not limited to, the expansion of payment and processing activities to new markets, and the expansion of products and services to existing markets ~~and opening of new bank branches~~, may be less successful or may be different than anticipated. ~~Such a result could adversely affect Cass’ business.~~

The Company makes certain projections as a basis for developing plans and strategies for its payment processing and banking products. If the Company does not accurately determine demand for its products and services, it could result in the Company incurring significant expenses without the anticipated increases in revenue, which could result in an adverse effect on its earnings.

14In addition, there are risks and uncertainties associated with the introduction of new products and services, including substantial investments of time and resources. The introduction and development of new products and services may not be achieved along expected timelines, or at all, and may not be successful as a result of factors beyond the Company’s control, including regulatory, competition and external market factors. Failure to successfully manage these risks in the development and implementation of new products or services, and failure to integrate such new products and services into

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the Company's ~~incurring~~existing ~~significant~~system ~~expenses~~of ~~without~~internal ~~the anticipated increases in revenue~~controls, ~~which~~ could ~~result~~have ina anmaterial adverse effect on its ~~earnings~~business, financial condition and results of operations.

~~In addition, there are risks and uncertainties associated with the introduction of new products and services, including substantial investments of time and resources.~~ The ~~introduction and development of new products and services may not be achieved along expected timelines, or at all, and may not be successful as a result of factors beyond the~~ Company’s ~~control,~~is ~~including~~subject ~~regulatory, competition and external market factors. Failure~~ to ~~successfully~~liquidity manage these risks in the development and implementation of new products or services, and failure to integrate such new products and services into our existing system of internal controls, could have a material adverse effect on our business, financial condition and results of operationsrisk.

The Company and the Bank are subject to liquidity risk.

The Company requires liquidity to meet deposit and accounts and drafts payable obligations as they come due. Access to funding sources in amounts adequate to finance the Company’s commitments and business activities or on terms that are acceptable or favorable to the Company could be impaired by risks and uncertainties that are beyond the Company’s control, including those described in this Item 1A, “Risk Factors” section.

The Company’s access to deposits and accounts and drafts payable for liquidity purposes may also be adversely affected by the needs of the Company’s depositors and customers. A failure to maintain adequate liquidity could have a material adverse effect on the Company’s business, financial condition and results of operations.

The ~~Company~~bank ~~could~~failures ~~experience~~in an2023 exemplify the potential serious results of the unexpected inability of insured depository institutions to obtain needed liquidity ~~which~~to ~~could~~satisfy ~~adversely~~deposit ~~affect~~withdrawal ~~the~~requests, ~~Company~~including how quickly such requests can accelerate once uninsured depositors lose confidence in an institution's ~~business,~~ability ~~profitability,~~to satisfy its obligations to depositors. The Company seeks to ensure funding needs are met by maintaining a level of liquidity through asset and ~~viability~~liability asmanagement. If the Company becomes unable to obtain funds when needed, it could have a ~~going~~material ~~concern~~adverse effect on its business, financial condition, and results of operations.

Liquidity measures the ability to meet current and future cash flow needs as they become due. The liquidity of a financial institution reflects its ability to meet loan requests, to accommodate possible outflows in deposits, and to take advantage of interest rate market opportunities and is essential to a financial institution’s business. The ability of a financial institution to meet its current financial obligations is a function of its balance sheet structure, its ability to liquidate assets, and its access to alternative sources of funds. The bank failures in 2023 exemplify the potential serious results of the unexpected inability of insured depository institutions to obtain needed liquidity to satisfy deposit withdrawal requests, including how quickly such requests can accelerate once uninsured depositors lose confidence in an institution's ability to satisfy its obligations to depositors. The Company seeks to ensure funding needs are met by maintaining a level of liquidity through asset and liability management. If the Company becomes unable to obtain funds when needed, it could have a material adverse effect on its business, financial condition, and results of operations.

Rising interest rates have decreased the value of the Company’s available-for-sale securities portfolio, and the Company would realize losses if it were required to sell such securities to meet liquidity needs.

As a result of inflationary pressures and the resulting rapid increases in interest rates over the last year, the fair value of previously issued government and other fixed income securities has declined significantly, resulting in unrealized losses. If the Company were required to sell such securities to meet liquidity needs, it may incur losses, which could impair the Company’s capital, financial condition, and results of operations and require the Company to raise additional capital on unfavorable terms, thereby negatively impacting its profitability. While the Company has taken actions to maximize its funding sources, there is no guarantee that such actions will be successful or sufficient in the event of sudden liquidity needs.

Management’s ability to retain key officers and employees may change.

Cass’ future operating results depend substantially upon the continued service of Cass’ executive officers and key personnel. Cass’ future operating results also depend in significant part upon Cass’ ability to attract and retain qualified management, financial, technical (including with AI experience), marketing, sales, and support personnel. Competition for qualified personnel is intense, and the Company cannot ensure success in attracting or retaining qualified personnel. There may be only a limited number of persons with the requisite skills to serve in these positions, and it may be increasingly difficult for the Company to hire personnel over time. Cass’ business, financial condition and results of operations could be materially adversely affected by the loss of any of its key employees, by the failure of any key employee to perform in his or her current position, or by Cass’ inability to attract and retain skilled employees.

15Cass’ stock price can become volatile and fluctuate widely in response to a variety of factors.

~~Table~~The ofCompany’s ~~Contents~~stock price can fluctuate based on factors that can include actual or anticipated variations in Cass’ quarterly results; new technology or services by competitors; unanticipated losses or gains due to unexpected events, including losses or gains on securities held for investment purposes; significant acquisitions or business combinations, strategic partnerships, joint ventures or capital commitments by or involving the Company or its competitors; changes in accounting policies or practices; failure to integrate acquisitions or realize anticipated benefits from acquisitions; or changes in government regulations.

General market fluctuations, industry factors and general economic and political conditions, such as economic slowdowns or recessions, governmental intervention, interest rate changes, credit loss trends, low trading volume or currency fluctuations also could cause Cass’ stock price to decrease regardless of the Company’s operating results.

Regulatory, Legal and Accounting Risk

The Company ~~and~~is ~~the Bank are~~ subject to extensive government regulation and supervision and possible enforcement or other legal actions that could detrimentally affect Cass’ business.

The Company ~~and~~is ~~the Bank are~~ subject to extensive federal and state regulation and supervision, the primary focus of which is to protect customers, depositors, the deposit insurance fund and the safety and soundness of the banking system as a whole, and not shareholders. InRegulatory ~~addition,~~authorities ~~since the global financial crisis, financial institutions generally~~ have been subject to increased scrutiny from regulatory authorities, with an increased focus on risk management and consumer compliance. This regulatory structure and heightened focus gives the regulatory authorities extensive discretion in connection with their supervisory and enforcement activities and examination policies, including policies with respect to capital levels, the timing and amount of dividend payments, the classification of assets and the establishment of adequate loan loss reserves for regulatory purposes. Failure to comply with applicable laws, regulations, policies or guidance could result in enforcement and other legal actions by federal and state authorities, including criminal and civil penalties, the loss of FDIC insurance, revocation of a banking ~~charter, and other regulatory sanctions, as well as reputational damage, any of which could have a material adverse effect on the Company’s business, financial condition and results of operations.~~

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charter, and other regulatory sanctions, as well as reputational damage, any of which could have a material adverse effect on the Company’s business, financial condition and results of operations.

Congress and federal regulatory agencies continually review banking laws, regulations and policies for possible changes. The substance and impact of pending or future legislation or regulation, or the application thereof, cannot be predicted, although any change could impact the regulatory structure under which the Company or its competitors operate and may significantly increase costs, impede the efficiency of internal business processes, require an increase in regulatory capital, require modifications to the Company’s business strategy, and/or limit its ability to pursue business opportunities in an efficient manner. A change in statutes, regulations or regulatory policies applicable to the Company or any of its subsidiaries could have a material, adverse effect on the Company’s business, financial condition and results of operations.

See Item 1, “Business—Supervision and Regulation,” and Item 8, Note 23 to the consolidated financial statements included elsewhere in this report for additional information.

The Company may need to raise additional capital or sell assets if it fails to meet regulatory capital requirements or meet commitments and liquidity needs. Such capital may not be available on favorable terms, or at all.

~~Fully~~Compliance phased in, the Basel III Capital rules implemented stricter capital requirements and leverage limits and methods for calculating risk-weighted assets, meaning the Company is required to hold more capital against such assets. Complying with ~~these~~regulatory ~~more stringent~~ capital requirements could result in management modifying its business strategy and could limit the Company’s ability to make distributions, including paying dividends, or buying back shares.

The Company may also need to raise additional capital in the future to provide it with sufficient capital resources and liquidity to meet commitments and business needs. The ability to raise additional capital, if needed, will depend on, among other things, conditions in the capital markets at that time and the Company’s financial condition, as well as the need for other financial institutions to raise capital at the same time. Economic conditions and the loss of confidence in financial institutions may increase the cost of funding and limit access to certain customary sources of capital, including inter-bank borrowings, repurchase agreements and borrowings from the discount window of the Federal Reserve.

An inability to raise additional capital on acceptable terms when needed could have a materially adverse effect on the Company’s business, financial condition and results of operations.

Legal and regulatory proceedings and related matters with respect to the financial services industry, including those directly involving the Company and its subsidiaries, could adversely affect Cass or the financial services industry in general.

The Company is subject to various legal and regulatory proceedings. It is inherently difficult to assess the outcome of these matters, and there can be no assurance that the Company will prevail in any proceeding or litigation. Any such matter could result in substantial cost and diversion of Cass’ efforts, which by itself could have a material adverse effect on Cass’ financial condition and operating results. Further, adverse determinations in such matters could result in actions by Cass’ regulators that could materially adversely affect Cass’ business, financial condition or results of operations. Please refer to Item 3, “Legal Proceedings.”

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The Company’s accounting policies and methods are the basis of how Cass reports its financial condition and results of operations, and they require management to make estimates about matters that are inherently uncertain. In addition, changes in accounting policies and practices, as may be adopted by the regulatory agencies, the Financial Accounting Standards Board, or other authoritative bodies, could materially impact Cass’ financial statements.

The Company’s accounting policies and methods are fundamental to how Cass records and reports its financial condition and results of operations. Management must exercise judgment in selecting and applying many of these accounting policies and methods in order to ensure that they comply with generally accepted accounting principles and reflect management’s judgment as to the most appropriate manner in which to record and report Cass’ financial condition and results of operations. In some cases, management must select the accounting policy or method to apply from two or more alternatives, any of which might be reasonable under the circumstances yet might result in the Company reporting materially different amounts than would have been reported under a different alternative.

Cass has identified one accounting policy around the calculation of the allowance for credit losses as being “critical” to the presentation of its financial condition and results of operations because it requires management to make particularly subjective and/or complex judgments about matters that are inherently uncertain and because of the likelihood that materially different amounts would be reported under different conditions or using different assumptions. More ~~information on Cass’ critical accounting policies is contained in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”~~

From time to time, the regulatory agencies, the Financial Accounting Standards Board (“FASB”), and other authoritative bodies change the financial accounting and reporting standards that govern the preparation of the Company’s financial statements. These changes can be hard to predict and can materially impact how management records and reports the Company’s financial condition and results of operations.

Cass is subject to examinations and challenges by tax authorities, which, if not resolved in the Company’s favor, could adversely affect the Company’s financial condition and results of operations.

In the normal course of business, Cass and its affiliates are routinely subject to examinations and challenges from federal and state tax authorities regarding the amount of taxes due in connection with investments it has made and the businesses in which it is engaged. Recently, federal and state taxing authorities have become increasingly aggressive in challenging tax positions taken by financial institutions. These tax positions may relate to tax compliance, sales and use, franchise, gross receipts, payroll, property and income tax issues, including tax base, apportionment and tax credit planning. The challenges made by tax authorities may result in adjustments to the timing or amount of taxable income or deductions or the allocation of income among tax jurisdictions. If any such challenges are made and are not resolved in the Company’s favor, they could have an adverse effect on Cass’ financial condition and results of operations.

General Risk Factors

Cass’ stock price can become volatile and fluctuate widely in response to a variety of factors.

The Company’s stock price can fluctuate based on factors that can include actual or anticipated variations in Cass’ quarterly results; new technology or services by competitors; unanticipated losses or gains due to unexpected events, including losses or gains on securities held for investment purposes; significant acquisitions or business combinations, strategic partnerships, joint ventures or capital commitments by or involving the Company or its competitors; changes in accounting policies or practices; failure to integrate acquisitions or realize anticipated benefits from acquisitions; or changes in government regulations.

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~~borrowers~~information toon ~~repay~~Cass’ ~~outstanding~~critical ~~loans,~~accounting ~~impair~~policies ~~the~~is ~~value~~contained ofin ~~collateral~~Item ~~securing loans~~7, ~~cause~~“Management’s ~~significant~~Discussion ~~property damage, result in loss of revenue~~ and~~/or~~ ~~cause~~Analysis ~~the Company to incur additional expenses. The occurrence~~ of ~~any~~Financial ~~such~~Condition ~~event in the future could have a material adverse effect on the Company’s business, which, in turn, could have a material adverse effect on the Company’s financial condition~~ and ~~results~~Results of ~~operations~~Operations.”

In the normal course of business, Cass and its affiliates are routinely subject to examinations and challenges from federal, state, and foreign tax authorities regarding the amount of taxes due in connection with investments it has made and the businesses in which it is engaged. The challenges made by tax authorities may result in adjustments to the timing or amount of taxable income or deductions or the allocation of income among tax jurisdictions. If any such challenges are made and are not resolved in the Company’s favor, they could have an adverse effect on Cass’ financial condition and results of operations.

General Risks

The value of the Company's goodwill and other intangible assets may decline in the future.

As of December 31, 2025, the Company had $19.9 million of goodwill and other intangible assets. A significant decline in the Company's expected future cash flows, a significant adverse change in the business climate, slower growth rates or a significant and sustained decline in the price of the Company's common stock may necessitate taking charges in the future related to the impairment of goodwill and other intangible assets which could have a material adverse effect on the Company's financial condition and results of operations.

Climate change could have a material negative impact on the Company and its clients.

~~The~~There ~~Company's~~is ~~business,~~an asincreasing ~~well~~concern asover the ~~operations~~risks ~~and~~of ~~activities~~climate ofchange itand ~~clients,~~related ~~could~~environmental besustainability ~~negatively~~matters. ~~impacted~~The byphysical risks of climate change. ~~Climate~~include ~~change~~discrete ~~presents~~events, ~~both~~such ~~immediate~~as flooding, hurricanes, and ~~long~~wildfires, and longer-term ~~risks~~shifts toin ~~Cass~~climate ~~and~~patterns, ~~its~~such ~~clients~~as ~~and~~extreme ~~these~~heat, ~~risks~~sea ~~are~~level ~~expected~~rise, toand ~~increase~~more ~~over~~frequent ~~time~~and prolonged drought. ~~Climate~~Under ~~changes~~medium ~~presents~~or ~~multi~~longer-~~faceted~~term ~~risks~~scenarios, ~~including~~such ~~(i)~~events, ~~operational~~if ~~risk~~uninterrupted ~~from~~or unaddressed, could disrupt the ~~physical~~Company's ~~effects~~operations ofor ~~climate~~those ~~events~~of onits ~~facilities~~customers ~~and~~or ~~other~~third ~~assets~~parties ason ~~well~~which asit ~~those~~relies, ofincluding ~~clients;~~through ~~(ii)~~direct ~~credit~~damage ~~risk~~to ~~from~~assets ~~borrowers~~and ~~with~~indirect ~~significant~~impacts ~~exposure~~from tosupply ~~climate~~chain ~~risk;~~disruption and ~~(iii)~~market ~~reputational~~volatility. ~~risk~~Additionally, ~~from~~transitioning ~~stakeholder~~to ~~concerns~~a ~~about~~low-carbon ~~practices~~economy ~~related~~may toentail ~~climate~~extensive ~~change~~policy, ~~carbon~~legal, ~~footprint~~technology, and ~~business~~market ~~relationships~~initiatives. ~~with~~Transition ~~clients~~risks, ~~who~~including ~~operate~~changes in ~~carbon-intensive~~consumer ~~industries.~~preferences ~~The~~and additional regulatory requirements or supervisory expectations or taxes, could increase the Company's ~~business~~expenses and undermine its strategies. In addition, the Company's reputation and ~~ability~~client relationships may be damaged as a result of its practices related to ~~attract~~climate ~~and~~change, ~~retain~~including ~~employees~~its ~~may~~involvement, ~~also~~or beits ~~harmed~~customers’ ifinvolvement, in certain industries or projects, in the ~~response~~absence toof mitigation and/or transition measures, associated with causing or exacerbating climate change, isas ~~perceived~~well as any decisions the Company makes to becontinue ~~ineffective~~to conduct or ~~insufficient~~change its activities in response to considerations relating to climate change.

Climate change exposes Cass to physical risk as its effects may lead to more frequent and more extreme weather events, such as prolonged droughts or flooding, tornados, hurricanes, wildfires and extreme seasonal weather; and longer-term shifts, such as increasing average temperatures, ozone depletion and rising sea levels. Such events and long-term shifts may damage, destroy or otherwise impact the value or productivity of the Company's properties and other assets; reduce the availability of insurance; and/or disrupt operations and other activities through prolonged outages. Such events and long-term shifts may also have a significant impact on Cass customers, which could amplify credit risk by diminishing borrowers’ repayment capacity or collateral values, and other businesses and counterparties with whom we transact, which could have a broader impact on the economy, supply chains and distribution networks.

Climate change also exposes Cass to transition risks associated with the transition to a less carbon-dependent economy. Transition risks may result from changes in policies; laws and regulations; technologies; and/or market preferences to address climate change. Such changes could materially, negatively impact our business, results of operations, financial condition and/or our reputation, in addition to having a similar impact on our clients. Cass has clients who operate in carbon-intensive industries that are exposed to climate risks, such as those risks related to the transition to a less carbon-dependent economy, as well as clients who operate in low-carbon industries that may be subject to risks associated with new technologies.

Federal and state banking regulators and supervisory authorities, investors and other stakeholders have increasingly viewed financial institutions as important in helping to address the risks related to climate change both directly and with respect to their clients, which may result in financial institutions coming under increased pressure regarding the disclosure and management of their climate risks and related lending and investment activities. The OCC, FRB and the U.S. Treasury Department have emphasized that climate-related risks are faced by banking organizations of all types and sizes, specifically including physical and transition risks, and is in the process of enhancing supervisory expectations regarding banks’ risk management practices. These agencies have indicated increased expectations for larger financial institutions to measure, monitor and manage climate-related risk as part of their enterprise risk management processes. Although any initial policies may not apply to financial institutions of the Bank’s size, it is likely that regulators will expect all banks to enhance internal control and risk management programs and processes relating to climate change. To the extent that these initiatives lead to the adoption of new regulations or guidance applicable to the Company and the Bank, compliance costs and risks are expected to increase.

Given that climate change could impose systemic risks upon the financial sector, either via disruptions in economic activity resulting from the physical impacts of climate change or changes in policies as the economy transitions to a less carbon-intensive environment, the Company faces ongoing legislative and regulatory uncertainties and changes regarding climate risk management and practices that if adopted, may result in higher regulatory, compliance, credit and reputational risks and costs.

The Company is subject to ESG risks that could adversely affect its reputation and the market price of its securities.

The Company is subject to a variety of risks arising from ESG matters. Risks arising from ESG matters may adversely affect, among other things, reputation and the market price of the Company’s securities. Further, the Company may be exposed to negative publicity based on the identity and activities of those to whom it lends and with which it otherwise does business and the public’s view of the approach and performance of its customers and business partners with respect to

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ESG matters. Any such negative publicity could arise from adverse news coverage in traditional media and could also spread through the use of social media platforms. The Company’s relationships and reputation with its existing and prospective customers and third parties with which it does business could be damaged if it were to become the subject of any such negative publicity. This, in turn, could have an adverse effect on the Company’s ability to attract and retain customers and employees and could have a negative impact on the market price for securities.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 1C. CYBERSECURITY

Managing cybersecurity risk within Cass is an ongoing, multifaceted process aimed at safeguarding digital assets and sensitive information. Led by the Company’s Chief Information Security Officer (“CISO”) and overseen by the ~~Executive~~Enterprise ITRisk ~~Council~~Management Committee ("ERMC"), the Company has a dedicated team of security professionals to implement the Company’s information security processes.

The ~~Executive~~ERMC ~~IT Council~~ is comprised of the CEO, CFO, Chief ~~information~~Information Officer (“CIO”), CISO, President and ~~all~~Chief ~~heads~~Operating Officer of ~~business~~Cass ~~units~~Commercial ~~that~~Bank, ~~serve~~Vice ~~together~~President toand ~~manage~~Chief ~~and~~Operational ~~oversee~~Risk ~~the~~Officer, ~~Company’s~~Chief ITHR ~~program~~Officer asand aGeneral ~~whole~~Counsel. As part of this function and at the direction of the CISO, the ~~Executive~~ERMC ~~IT Council~~ is charged with approving and providing oversight of the IT solutions that enhance the Company’s security posture. As more fully described in “Governance” below, the CISO and CIO regularly report the Executive IT Council’s findings to the Audit and Risk Committee of the Board, and to the full Board, in an effort to provide a collaborative and multi-point cybersecurity program.

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below, the CISO and CIO regularly report the ERMC's findings to the Audit and Risk Committee of the Board, and to the full Board, in an effort to provide a collaborative and multi-point cybersecurity program.

The Company also relies on certain critical third party IT vendors that support processing, transmission, and storage of data, which has become more critical given the information security risks that are intensified through the Company’s increased use of remote work arrangements. The Company has also engaged a third party to help monitor and analyze its system activities.

The Company’s information security program is comprised of three primary components that guide the activities of employees and advisors tasked with managing the program:

•Information Security Policy: The Company maintains an Information Security Policy that aligns with the National Institute of Standards and Technology and ISO 27001 cybersecurity guidelines and frameworks. This policy is reviewed at least annually by the Company’s IT Security & Risk team, with updates approved by the Board of Directors. The Information Security Policy addresses the standards, design, scope, testing, and operation of the Company’s cybersecurity program. All Company employees are trained both initially and on an annual basis on the information security requirements set by the policy. Employees whose work is more pertinent to cybersecurity management and risk, such as software development, receive additional and more specialized training.

•Incident Management Policy: The Company’s Incident Management Policy provides the structure and guidance for the Company’s cyber incident response operations to ensure the quick detection of security events and vulnerabilities, as well as promote a rapid response to security incidents and mitigation measures. A dedicated security incident response team is tasked with addressing security incidents and driving the Company’s response.

•Cyber Risk Management Program: The Company performs a comprehensive risk assessment on an annual basis to identify and prioritize potential threats and vulnerabilities, then uses the results to implement and revise policies, assign responsibilities, and deploy security controls to address them on an ongoing, 24-7 basis.

Using the policies and programs described above, Cass has implemented a multi-layered cybersecurity approach, including deployment of advanced endpoint protection, threat intelligence, and anomaly detection tools, continuous monitoring of network traffic through intrusion detection and prevention systems, regular penetration testing and vulnerability assessments, and encryption of sensitive data at rest and in transit.

Cass is dependent on third-party vendors to support operations and business objectives. Recognizing the interconnected nature of the Company’s business, Cass places emphasis on managing third-party cybersecurity risk by maintaining a Vendor Management Policy. This policy establishes guidelines for conducting due diligence on vendors’ security practices, making ongoing risk assessments and conducting extensive control reviews of identified high-risk vendors.

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Because the Company is a bank holding company, its information security program is regularly evaluated by banking examiners and regulators. In addition, the Company undergoes annual Service Organization Controls Type II audits to evaluate information security controls related to specific services offered by the Company.

While the Company continues to face a number of cybersecurity risks in connection with the business, Cass has not experienced any cyber incidents that materially affected business strategy, results of operations or financial condition over the past fiscal year. The Company commits to transparently communicating with stakeholders, including shareholders, regulatory bodies, and law enforcement agencies, as required. To mitigate financial risks associated with cybersecurity incidents, Cass maintains a comprehensive cyber insurance policy. This policy covers various costs, including legal expenses, investigation costs, business interruption, and potential liabilities.

Governance

As described above, the Company's cybersecurity program is led by the CISO, who ultimately reports to the Executive Vice President and CIO. The CISO is supported by an information security team, made up of two security analysts and one IT audit and compliance analyst. The security analysts monitor the Company’s security solutions and security event logs and ~~responds~~respond to incidents and events when they occur. The IT audit and compliance analyst tracks remediation efforts, manages the Company’s third party risk program and works with internal and external auditors on all IT compliance activities. Members of the information security team hold cybersecurity certifications, such as athe Certified Information Systems Security Professional ("CISSP") or Certified Information Security Manager certifications. The CIO oversees all IT departments within the Company, including security and risk, and is the primary liaison between IT and the Board of Directors.

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Both the CISO and CIO have extensive experience assessing and managing cybersecurity programs and cybersecurity risk. The CIO has a bachelor’s degree in Management Information Systems and an MBA from Oakland University, and was previously the Domain CIO at Comerica Bank. The CISO has a bachelor’s degree in Computer Science from the University of Illinois, holds the CISSP, Certified in Risk and Information Systems Control and Certified Chief Information Security Officer certifications, and has been active in the management of the Company’s security programs for more than a decade, serving in the CISO role since early 2023.

~~The~~AI ~~CISO~~related ~~and~~risks ~~CIO~~are ~~provide~~considered ~~monthly~~as ~~updates~~part toof the ~~Executive~~overall ITcybersecurity ~~Council~~program. onThe ~~security~~Company ~~incidents,~~maintains ~~compliance~~an ~~and~~AI ~~patching~~governance ~~metrics~~framework designed to support the responsible development, asdeployment, ~~well~~and asuse ~~security~~of ~~related~~AI ~~industry~~technologies ~~updates~~and ~~that~~to ~~might~~manage ~~affect~~associated ~~the~~cybersecurity ~~Company’s~~and ~~business~~operational risks. ~~Real~~The ~~time~~AI ~~updates~~Governance ~~are~~Committee, ~~also~~which ~~provided~~is tocomprised of the ~~Executive~~CIO, ITCISO, ~~Council~~General asCounsel, ~~needed.~~Chief ~~The~~HR ~~Executive~~Officer, ITVice ~~Council~~President ~~approves~~and ~~all~~Chief ~~security~~Operational ~~related~~Risk ~~project~~Officer, ~~expenditures~~Vice ~~and~~President ~~all~~of ~~members~~Internal ~~are~~Audit aand ~~part~~line of business representatives, oversees the ~~Company’s~~policies, ~~incident~~standards, ~~response~~and ~~team.~~risk assessment processes designed to manage these risks.

The ~~Audit~~CISO and ~~Risk~~CIO ~~Committee,~~provide ~~together~~monthly ~~with~~updates ~~the~~to ~~full Board of Directors, actively oversees~~ the ~~Company’s~~ERMC ~~cybersecurity program. The Audit and Risk Committee receives reports~~ on ~~evolving~~security ~~cybersecurity~~incidents, ~~standards~~compliance and ~~key~~patching metrics, ~~including the number of incidents, response times,~~ and ~~effectiveness~~security ~~of safety controls from the CIO on a quarterly basis,~~ and ~~more~~AI ~~frequently~~related ~~when~~industry ~~necessary. These reports include~~ updates onthat ~~the~~might ~~activities~~affect of the ~~Executive IT Council. Changes to the~~ Company’s ~~information security policies and programs are approved by the Audit and Risk Committee~~business. ~~This~~The ~~information~~ERMC isapproves ~~reported~~all tosecurity ~~the~~related ~~full~~project ~~Board of Directors which~~expenditures, ~~together with the Audit~~ and ~~Risk~~all ~~Committee,~~members ~~evaluates~~are ~~and~~a ~~considers~~part ~~the effectiveness~~ of the Company’s ~~risk~~incident ~~management~~response ~~policies and controls relating to cybersecurity that are described in the section above~~team.

The ~~Company~~Audit ~~believes~~and ~~that~~Risk byCommittee, ~~layering~~together with the full Board of Directors, actively oversees the Company’s cybersecurity ~~practices~~program. The Audit and ~~risk~~Risk ~~management~~Committee ~~oversight~~receives inreports aon ~~way~~evolving ~~that~~cybersecurity ~~involves~~standards ~~various~~and ~~individuals~~key metrics, ~~teams~~including the number of incidents, ~~and~~response ~~ultimately~~times, ~~the~~and ~~Board~~effectiveness of ~~Directors,~~safety itcontrols ~~fosters~~from the CIO on a ~~culture~~quarterly basis, and more frequently when necessary. These reports include updates on the activities of ~~accountability~~the ERMC. Changes to the Company’s information security policies and ~~helps~~programs ~~enable~~are ~~Cass~~approved by the Audit and Risk Committee. This information is reported to ~~prioritize~~the full Board of Directors which, together with the ~~safety~~Audit and ~~security~~Risk ofCommittee, ~~its~~evaluates and ~~its~~considers ~~clients~~the effectiveness of the Company’s ~~data~~risk management policies and controls relating to cybersecurity that are described in the section above.

The Company believes that, by layering cybersecurity practices and risk management oversight in a way that involves various individuals, teams, and ultimately, the Board of Directors, it fosters a culture of accountability and helps enable Cass to prioritize the safety and security of its and its clients’ data.

ITEM 2. PROPERTIES

The Company leases office space in St. Louis County, Missouri, to house the headquarters of the Company and the Bank. The Company’s headquarters occupy 7,549 square feet in an office center at 12444 Powerscourt Drive. The Bank’s headquarters occupy 16,572 square feet in the same center at 12412 Powerscourt Drive.

The Company owns approximately 61,500 square feet of office space at 13001 Hollenberg Drive in Bridgeton, Missouri, where the Company’s transportation processing activities are performed.

20The Company owns a production facility of approximately 48,300 square feet located at 2675 Corporate Exchange Drive, Columbus, Ohio. Additional facilities are located in Wellington, Kansas, Jacksonville, Florida, and Brighton, Michigan. The Company has offices in Breda, Netherlands, Basingstoke, United Kingdom, and Singapore to service its multinational customers.

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The Company owns a production facility of approximately 48,300 square feet located at 2675 Corporate Exchange Drive, Columbus, Ohio. Additional facilities are located in Greenville, South Carolina, Wellington, Kansas, Jacksonville, Florida, and Brighton, Michigan. The Company has offices in Breda, Netherlands, Basingstoke, United Kingdom, and Singapore to service its multinational customers.

In addition, the Bank owns a banking facility near downtown St. Louis, Missouri, has an operating branch in the Bridgeton, Missouri location, and has an additional leased facility in Colorado Springs, Colorado.

Management believes that these facilities are suitable and adequate for the Company’s operations.

ITEM 3. LEGAL PROCEEDINGS

The Company and its subsidiaries are not involved in any pending proceedings other than ordinary routine litigation incidental to their businesses. Management believes none of these proceedings, if determined adversely, would have a material effect on the business or financial conditions of the Company or its subsidiaries.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

The Company’s common stock is quoted on The Nasdaq Global Select Market® under the symbol “CASS.” As of February 2127, ~~2025~~2026, there were approximately 63,~~000~~833 holders of record of the Company’s common stock.

The Company has continuously paid regularly scheduled cash dividends since 1934 and expects to continue to pay quarterly cash dividends in the future. However, future dividend payments will depend on the Company’s earnings, capital requirements, financial condition, applicable banking regulatory requirements and other factors considered relevant by the Company’s Board of Directors.

The Company maintains a treasury stock buyback program approved by the Board of Directors in ~~October~~November ~~2023~~2025 pursuant to which, the Board of Directors has authorized the repurchase of up to ~~500~~1,000,000 shares of the Company’s common stock and has no expiration date. Repurchases may be made through a variety of methods, which could include open market purchases, privately negotiated transactions, or otherwise in accordance with applicable federal securities laws, including repurchase plans that satisfy the conditions of Rule 10b5-1 of the Securities Exchange Act of 1934, as amended. The Company has repurchased ~~181~~125,~~419~~030 shares under this treasury stock buyback program and therefore has ~~318~~874,~~581~~970 shares remaining for repurchase.

The Company repurchased a total of ~~167~~617,~~455~~415 shares at an aggregate cost of $726.20 million during the year ended December 31, ~~2024~~2025 and ~~150~~167,~~541~~455 shares at an aggregate cost of $57.82 million during the year ended December 31, ~~2023~~2024. A portion of the repurchased shares may be used for the Company’s employee benefit plans and the balance will be available for other general corporate purposes. The pace of repurchase activity will depend on factors such as levels of regulatory capital, net income, dividends, acquisition and divestiture activity, cash generation from operations, cash requirements for investments, repayment of debt, current stock price, business and market conditions, and other factors. The Company may repurchase shares from time to time on the open market or in private transactions, including structured transactions. The stock repurchase program may be modified or discontinued at any time.

During the three months ended December 31, ~~2024~~2025, the Company repurchased shares of its common stock as follows:

Period	Total Number of Shares Purchased(1)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2)	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
October 1, 2024 – October 31, 2024	8,787	$	41.40	8,787	389,507
October 1, 2025 – October 31, 2025	36,039	$	40.20	36,039	304,374
November 1, 2024 – November 30, 2024	28,514	44.56		28,514	360,993
November 1, 2025 – November 30, 2025	128,911	40.81		128,911	911,470
December 1, 2024 – December 31, 2024	42,412	45.02		42,412	318,581
December 1, 2025 – December 31, 2025	36,500	43.27		36,500	874,970
Total	79201,~~713~~450	$	4441.4615	79201,~~713~~450	~~318~~874,~~581~~970

(1)During the quarter ended December 31, ~~2024~~2025, there were 79201,~~713~~450 shares repurchased pursuant to the Company's publicly announced treasury stock buyback ~~program~~programs and no shares transferred from employees in satisfaction of tax withholding obligations upon the vesting of restricted stock.

(2)~~The~~On July 15, 2025, the Board of Directors authorized the ~~treasury~~repurchase ~~stock~~of ~~buyback~~up ~~program~~to ~~on October 17~~500,000 ~~2023,~~shares ~~announced~~of by the Company's oncommon ~~October~~stock ~~19,~~with ~~2023~~no expiration date. ~~The~~On ~~program~~November ~~provides~~6, ~~that~~2025, the ~~Company~~Board ~~may~~of ~~repurchase~~Directors upauthorized tothe anrepurchase ~~aggregate~~ of ~~500~~up to 1,000,000 shares of the Company’s common stock ~~and~~with ~~has~~ no expiration date, replacing the July 15, 2025 authorization. During the quarter ended December 31, 2025, the Company repurchased 125,030 shares under the November 6, 2025 authorization and 76,420 shares under the July 15, 2025 authorization.

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Performance Quoted on The Nasdaq Stock Market for the Last Five Fiscal Years

The following graph compares the cumulative total returns over the last five fiscal years of a hypothetical investment of $100 in shares of common stock of the Company with a hypothetical investment of $100 in The Nasdaq Stock Market (“Nasdaq”), the index of Nasdaq computer and data processing stocks, and the index of Nasdaq bank stocks. The graph assumes $100 was invested on December 31, ~~2019~~2020, with dividends reinvested. Returns are based on period end prices.

ITEM 6. RESERVED

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to promote understanding of the results of operations and financial condition. MD&A is provided as a supplement to, and should be read in conjunction with, the consolidated financial statements and the accompanying Notes to Financial Statements (Part II, Item 8 of this Form 10-K). This section generally discusses the results of operations for ~~2024~~2025 compared to ~~2023~~2024. For discussion related to the results of operations and changes in financial condition for ~~2023~~2024 compared to ~~2022~~2023 refer to Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's ~~2023~~2024 Annual Report on Form 10-K filed with the SEC on ~~February~~March 285, ~~2024~~2025.

The Company intends for the discussion of financial condition and results of operations that follows to provide information that will assist the reader in understanding the Consolidated Financial Statements, the changes in certain key items in those financial statements from year to year, and the primary factors that accounted for those changes, as well as how certain accounting principles, policies, and estimates affect the Consolidated Financial Statements. This discussion should be read in conjunction the Consolidated Financial Statements and the related notes that appear in Part II, Item 8 of this document.

~~Executive~~Forward-Looking ~~Overview~~Statements and Factors that Could Affect Future Results

~~The~~Certain ~~specific~~statements ~~payment~~contained ~~and~~in ~~information~~this ~~processing~~Annual ~~services~~Report ~~provided~~on toForm ~~each~~10-K ~~customer~~that are ~~developed~~not ~~individually~~statements toof ~~meet~~historical ~~each~~fact ~~customer’s~~constitute ~~requirements~~forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Act”), ~~which~~notwithstanding ~~can~~that ~~vary~~such ~~greatly~~statements are not specifically identified as such. In addition, ~~the~~certain ~~degree~~statements ofmay ~~automation~~be ~~such~~contained asin ~~electronic~~the ~~data~~Company's ~~interchange,~~future ~~imaging~~filings with the SEC, ~~work~~in ~~flow~~press releases, and ~~web-based~~in ~~solutions~~oral ~~varies~~and ~~greatly~~written ~~among~~statements ~~customers~~made by the Company or with the Company's approval that are not statements of historical fact and ~~industries~~constitute forward-looking statements within the meaning of the Act. ~~These~~Examples ~~factors~~of forward-looking statements include, but are not limited to: (i) projections of revenues, expenses, income or loss, earnings or loss per share, the payment or nonpayment of dividends,

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capital structure and other financial items; (ii) statements of plans, objectives and expectations of the Company or its management or Board of Directors, including those relating to products, services or operations; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such statements. Words such as “believes,” “anticipates,” “expects,” “intends,” “targeted,” “continue,” “remain,” “will,” “should,” “may,” and other similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.

Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those in such statements. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to:

•The effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board and the implementation of tariffs and other protectionist trade policies.

•Inflation, interest rate, securities market, and monetary fluctuations.

•Changes in energy prices.

•Changes in freight rates.

•Local, regional, national, and international economic conditions and the impact they may have on the Company and its customers and its assessment of that impact.

•Changes in the financial performance and/or condition of the Company's borrowers.

•Changes in the mix of loan sectors and types or the level of non-performing assets and charge-offs.

•Changes in estimates of future allowance for credit losses requirements based upon the periodic review thereof under relevant regulatory and accounting requirements.

•Changes in the Company's liquidity position.

•Impairment of the Company's goodwill or other intangible assets.

•Changes in consumer spending, borrowing, and saving habits.

•Technological changes, including artificial intelligence.

•The cost and effects of cyber incidents or other failures, interruptions, or security breaches of the Company's systems or those of the Company's customers or third-party providers.

•Acquisitions and integration of acquired businesses.

•Changes in the reliability of the Company's vendors, internal control systems or information systems.

•The Company's ability to increase market share and control expenses.

•The Company's ability to attract and retain qualified employees.

•Changes in the Company's organization, compensation, and benefit plans.

•The soundness of other financial institutions.

•Volatility and disruption in national and international financial and commodity markets.

•Government intervention in the U.S. financial system.

•Political or economic instability.

•Acts of God or of war or terrorism.

•The potential impact of climate change.

•The impact of pandemics, epidemics, or any other health-related crisis.

•The costs and effects of legal and regulatory developments, the resolution of legal proceedings or regulatory or other governmental inquiries, the results of regulatory examinations or reviews and the ability to obtain required regulatory approvals.

•The effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities, and insurance) and their application with which the Company must comply.

•The effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard setters.

•The Company's success at managing the risks involved in the foregoing items.

In addition, financial markets, international relations, and global supply chains have been significantly impacted by recent U.S. trade policies and practices. Due to the rapidly evolving and changing state of U.S. trade policies, the amount and duration of any tariffs and their ultimate impact on the Company, its customers, financial markets, and the overall U.S. and global economies is currently uncertain. Nonetheless, prolonged uncertainty, elevated tariff levels or their wide-spread use in U.S. trade policy could weaken economic conditions and adversely impact the ability of borrowers to repay outstanding loans or the value of collateral securing these loans or adversely affect financial markets or the values of securities. To the extent that these risks may have a negative impact on the financial condition of borrowers or financial markets, it could also have a material adverse effect on the Company's business, financial condition and results of operations.

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~~combine~~Forward-looking sostatements ~~that~~speak ~~pricing~~only ~~varies~~as ~~greatly~~of ~~among~~ the ~~customer~~date ~~base.~~on Inwhich ~~general,~~such ~~however,~~statements ~~Cass~~are ~~is compensated for its processing services through service fees, transactional level payment services, and investment of account balances generated during the payment process~~made. The ~~amount,~~Company ~~type,~~does ~~and~~not ~~calculation~~undertake ofany ~~service~~obligation ~~fees~~to ~~vary~~update ~~greatly~~any byforward-looking ~~service~~statement offering, but generally follow the volume of transactions processed. Transactional level payment services and interest income from the balances generated during the payment processing cycle are affected by the amount of time Cass holds the funds prior to ~~payment~~reflect ~~and~~events ~~the~~or ~~dollar~~circumstances ~~volume~~after ~~processed. Both~~ the ~~number~~date ofon ~~transactions~~which ~~processed and the dollar volume processed are therefore key metrics followed by management. Other factors will also influence revenue and profitability,~~ such asstatement ~~changes~~is ~~in the general level of interest rates~~made, ~~which~~or ~~have a significant effect on net interest income. The funds generated by these processing activities are invested in overnight investments, investment grade securities, advances~~ to ~~payees,~~reflect ~~and loans generated by~~ the ~~Bank.~~occurrence ~~The Bank earns most~~ of ~~its~~unanticipated ~~revenue from net interest income, or the difference between the interest earned on its loans and investments and the interest paid on its deposits and other borrowings~~events. ~~The Bank also assesses fees on other services such as cash management services.~~

~~Industry-wide~~Executive factors that impact the Company include the willingness of large corporations to outsource key business functions such as freight, energy, telecommunication and environmental payment and audit. The benefits that can be achieved by outsourcing transaction processing, and the management information generated by Cass’ systems can be influenced by factors such as the competitive pressures within industries to improve profitability, the general level of transportation costs, deregulation of energy costs, and consolidation of telecommunication providers. Economic factors that impact the Company include the general level of economic activity that can affect the volume and size of invoices processed, the ability to hire and retain qualified staff, and the growth and quality of the loan portfolio. The general level of interest rates also has a significant effect on the revenue of the Company. As discussed in greater detail in Item 7A, “Quantitative and Qualitative Disclosures about Market Risk,” a decline in the general level of interest rates can have a negative impact on net interest income and conversely, a rise in the general level of interest rates can have a positive impact on net interest income. The cost of fuel is another factor that has a significant impact on the transportation sector. As the price of fuel goes up or down, the Company’s earnings increase or decrease with the dollar amount of transportation invoices. Overview

The ~~Company~~specific ~~continues~~payment and information processing services provided to ~~operate~~each ~~profitably~~customer are developed individually to meet each customer’s requirements, ~~posting~~which acan 0vary greatly.~~82%~~ ~~return~~In onaddition, ~~average~~the ~~assets~~degree of automation such as electronic data interchange, imaging, work flow, and 8web-based solutions varies greatly among customers and industries.~~37%~~ ~~return~~These onfactors ~~average~~combine ~~equity~~so that pricing varies greatly among the customer base. ~~The~~In ~~Company’s~~general, ~~common~~however, ~~equity~~Cass ~~Tier~~is 1compensated ~~capital~~for ~~ratio~~its ~~was~~processing 13services through service fees, transactional level payment services, and investment of account balances generated during the payment process.~~84%~~ atThe ~~December 31~~amount, ~~2024~~type, ~~significantly~~and ~~exceeding~~calculation ~~regulatory~~of ~~requirements~~service fees vary greatly by service offering, but generally follow the volume of transactions processed. InTransactional ~~addition~~level payment services and interest income from the balances generated during the payment processing cycle are affected by the amount of time Cass holds the funds prior to payment and the dollar volume processed. Both the number of transactions processed and the dollar volume processed are therefore key metrics followed by management. Other factors will also influence revenue and profitability, such as changes in the ~~Company~~general ~~has~~level ~~maintained~~of ~~exceptional~~interest ~~credit~~rates, ~~quality~~which ~~with~~have noa ~~non-performing~~significant ~~loans~~effect aton ~~December 31~~net interest income. The funds generated by these processing activities are invested in overnight investments, ~~2024~~investment grade securities, ~~and~~advances noto ~~loan~~payees, ~~charge-offs~~and ~~during~~loans generated by the ~~year~~Bank. ~~ended~~The ~~December 31~~Bank earns most of its revenue from net interest income, ~~2024~~or the difference between the interest earned on its loans and investments and the interest paid on its deposits and other borrowings. The Bank also assesses fees on other services such as cash management services.

~~The~~Industry-wide factors that impact the Company’s ~~solid~~include ~~capital~~the ~~and~~willingness ~~liquidity~~of ~~positions~~large corporations to outsource key business functions such as freight, ~~combined~~energy, ~~with~~and ~~ongoing~~environmental ~~earnings~~payment and audit. The benefits that can be achieved by outsourcing transaction processing, ~~are~~and ~~expected~~the tomanagement ~~continue~~information generated by Cass’ systems can be influenced by factors such as the competitive pressures within industries to ~~allow~~improve ~~for~~profitability, ~~investment~~the ingeneral ~~strategic~~level ~~opportunities~~of ~~when~~transportation ~~they~~costs ~~become~~and ~~available~~deregulation of energy costs. Economic factors that impact the Company include the general level of economic activity that can affect the volume and size of invoices processed, inthe ~~addition~~ability to ~~return~~hire and retain qualified staff, and the growth and quality of ~~capital~~the toloan ~~shareholders~~portfolio. The ~~Company~~general ~~delivered~~level ~~$16~~of interest rates also has a significant effect on the revenue of the Company.5 ~~million~~As discussed in ~~dividend~~greater ~~payments~~detail in Item 7A, “Quantitative and ~~$7.2~~Qualitative ~~million~~Disclosures about Market Risk,” a decline in ~~share~~the ~~repurchases~~general ~~during~~level ~~2024~~of interest rates can have a negative impact on net interest income and conversely, a rise in the general level of interest rates can have a positive impact on net interest income. The ~~Company~~cost ~~continues~~of toenergy ~~invest~~is inanother factor that has a significant impact on the ~~technology,~~transportation ~~processes~~and facility sectors. As the price of energy goes up or down, ~~and~~the ~~people~~Company’s ~~required~~earnings toincrease ~~support~~or ~~its~~decrease ~~multi-national~~with ~~customer~~the ~~base~~dollar amount of transportation and facility expense invoices.

The Company continues to operate profitably, posting a 1.43% return on average assets and 14.98% return on average equity. The Company’s common equity Tier 1 capital ratio was 15.10% at December 31, 2025, significantly exceeding regulatory requirements. In addition, the Company has maintained exceptional credit quality with no loan charge-offs during the year ended December 31, 2025.

The Company’s solid capital and liquidity positions, combined with ongoing earnings, are expected to continue to allow for investment in strategic opportunities when they become available, in addition to return of capital to shareholders. The Company delivered $16.5 million in dividend payments and $26.0 million in share repurchases during 2025. The Company continues to invest in the technology, processes, and people required to support its multi-national customer base.

Currently, management views Cass’ major opportunity as the continued expansion of its payment and information processing service offerings and customer base. Management intends to accomplish this by maintaining the Company’s leadership position in applied technology, which when combined with the security and processing controls of the Bank, makes Cass unique in the industry.

Recent Industry Developments

~~The~~While ~~transportation industry continues to experience a decline in overall~~ freight rates ~~caused~~have byrecently anbegun ~~ongoing~~gradually ~~freight~~increasing ~~recession.~~after ~~The~~a ~~freight recession adversely affects the~~ number of ~~freight~~quarters ~~transactions~~of ~~and~~decline ~~dollar~~since ~~amount~~2023, ofvolumes ~~invoices~~continue ~~processed.~~to ~~Partially~~decline ason a ~~result~~year-over-year basis, ~~the~~which ~~Company's~~continues ~~transportation~~to ~~invoice~~put ~~and~~pressure ~~dollar~~on ~~volumes~~transportation ~~declined~~related 0processing fees.6% ~~and~~In ~~5.7%~~addition, ~~respectively~~carrier ~~during~~consolidation ~~the~~with ~~year~~small ~~ended~~and ~~December 31,~~medium-sized ~~2024~~trucking ascompanies ~~compared~~exiting to the ~~same~~market ~~period~~or inselling ~~2023. Transportation dollar volumes are key~~ to ~~the~~larger ~~Company’s~~carriers ~~revenue~~continues ~~as higher volumes generally lead~~ to anput ~~increase~~downward inpressure ~~payment~~on ~~float,~~financial ~~which~~fees ~~generates interest income,~~ as ~~well~~the assmaller antrucking ~~increase~~companies inwere ~~payments~~larger inusers ~~advance~~ of ~~funding,~~our ~~which~~quick ~~generates~~pay ~~financial fees~~solutions.

Recent Items of Note

Average interest-earning assets for December 31, 2024 declined $65.4 million, or 3.1%, as compared to 2023. The Company had fewer funds to invest due to the loss of approximately $100.0 million of balances in February 2024 as a result of a cyber attack experienced by a CassPay client. CassPay offers solutions such as integrated payments, a B2B payment platform for clients. The loss of CassPay balances was partially offset by an increase in facility dollar volumes of 8.1%, leading to higher average accounts and drafts payable.

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~~Despite~~The ~~the~~Company ~~decline~~started into ~~average~~see ~~interest-earning~~increased ~~assets~~tariff ~~during~~related ~~the~~charges ~~year,~~on ~~the~~shipping ~~Company’s~~invoices ~~liquidity~~of ~~position~~its ~~and~~clients ~~balance~~beginning ~~sheet~~in ~~remains~~April ~~strong~~2025. The Company ~~maintained~~estimates ~~average~~that ~~short-term~~transportation ~~investments~~dollar ofvolumes were approximately $~~326.2~~600 million ~~during~~higher in 2025 than 2024. Indue ~~addition,~~to ~~all~~the impact of ~~the~~tariffs. The Company's ~~investment~~benefits ~~securities~~from ~~are~~higher ~~classified~~dollar asvolumes ~~available-for-sale~~given ~~and~~the ~~there~~related ~~were~~increases noin ~~outstanding~~accounts ~~borrowings~~and atdrafts ~~December 31,~~payable ~~2024~~and interest income.

The Company ~~recorded~~has ~~bad~~experienced ~~debt~~an ~~expense~~increase ofin ~~$7.8~~facility ~~million~~dollar ~~for~~volumes ~~the~~in ~~year~~recent ~~ended~~quarters ~~December 31~~due to higher energy usage and prices, ~~2024~~in onaddition ato ~~funding~~onboarding ~~receivable~~new ~~related~~clients with high dollar volumes as compared to athe ~~facility~~related ~~client~~transaction count. ~~See~~Energy ~~Note~~prices 15are rising due to a number of factors, ~~"Commitments~~including an aging power grid, and ~~Contingencies"~~rising demand for ~~further~~electricity ~~information.~~as a result of data center construction to power artificial intelligence and electric vehicles.

~~During~~Recent ~~July~~Items ~~2024, the Company approved an Amendment providing for the termination~~ of its noncontributory defined-benefit pension plan. The Company recorded a one-time termination expense of approximately $3.5 million through operating expense related to the plan termination during the fourth quarter of 2024 as the plan liabilities were settled. The successful termination of the plan is expected to reduce run rate operating expense by approximately $1.0 million on an annual basis.Note

InNet ~~December~~interest ~~2024,~~income ~~the~~increased ~~Company~~$13.5 ~~acquired AcuAudit~~million, aor ~~freight~~19.8%, ~~audit~~as ~~platform~~compared ~~for~~to ~~ocean~~the ~~and~~same ~~international~~period ~~air~~last ~~freight,~~year. ~~from~~The ~~Acuitive~~increase ~~Solutions~~in ~~LLC.~~net ~~The~~interest ~~Asset~~income ~~Purchase~~was ~~Agreement~~attributable ~~reflects~~to athe ~~base~~net ~~purchase~~interest ~~price~~margin ofimproving $to 3.083% ~~million~~as ~~and~~compared anto ~~earnout~~3.42% ~~based~~in onthe ~~annualized~~same ~~recurring~~period ~~revenue~~last atyear, ~~the~~in ~~end~~addition ofto 24an ~~months.~~increase ~~Current~~in ~~annualized~~average ~~recurring~~interest-earning ~~revenue~~assets isof ~~approximately~~ $2136.58 million, or 6.8%. The Company ~~expects~~generally ~~the~~benefits ~~impact~~from ofa ~~the~~higher ~~acquisition~~interest torate beenvironment ~~EBITDA~~due ~~neutral~~to ~~in 2025 and~~ a ~~minimal~~large ~~negative~~percentage ~~impact~~of toits ~~diluted~~funding ~~earnings~~sources ~~per~~being ~~share~~non-interest ~~driven by intangible amortization~~bearing.

The One Big Beautiful Bill Act (“OBBBA”) was enacted on July 4, 2025. Among other things, the new law makes permanent certain expiring business tax provisions of the Tax Cuts and Jobs Act (“TCJA”). These include provisions which allow businesses to immediately expense, for tax purposes, the cost of new investments in certain qualified depreciable assets and the cost of qualified domestic research and development. The OBBBA also imposes a floor on tax deductions taken on charitable contributions. The OBBBA also significantly changes U.S. tax law related to foreign operations and certain tax credits. The impact of the OBBBA is not expected to have a material impact on the Company's consolidated financial statements.

Discontinued Operations

On April 7, 2025, the Company signed an Asset Purchase Agreement providing for the sale of its Telecom Expense Management & Managed Mobility Services (“TEM”) business to Asignet USA Inc. The sale closed on June 30, 2025. We have applied discontinued operations accounting in accordance with FASB Accounting Standards Codification (“ASC”), Topic 205-20, “Presentation of Financial Statements – Discontinued Operations,” to the assets and liabilities sold related to the Company's TEM Business Unit as of and for the years ended December 31, 2025, 2024, and 2023, as applicable. All financial information in this Annual Report on Form 10-K is reported on a continuing operations basis, unless otherwise noted. See Note 2 and Note 20 to the Company's consolidated financial statements for further discussion regarding discontinued operations and subsequent events associated with discontinued operations.

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Summary of Results

Various indicators are used by management in evaluating the Company's financial condition and operating performance. Among these indicators are net income and earnings per share, total revenue, operating expense, asset quality indicators such as nonperforming assets to assets and net charge-offs to average loans, and return on average assets and equity.


(In thousands except per share data)	For the Years Ended December 31,						% Change
	2025			2024			2023			2025 v. 2024		2024 v. 2023
Processing fees	$	66,129		$	66,061		$	59,670		0.1	%	10.7	%
Financial fees	40,398			42,584			45,339			(5.1)	%	(6.1)	%
Net interest income	81,240			67,787			66,494			19.8	%	1.9	%
Provision for (release of) credit losses	348			447			(550)			(22.1)	%	(181.3)	%
Loss on sale of investment securities	(3,534)			(45)			(173)			N/M		(74.0)	%
Other	6,865			5,247			5,089			30.8	%	3.1	%
Total revenues	190,750			181,187			176,969			5.3	%	2.4	%
Operating expense	151,991			157,742			142,505			(3.6)	%	10.7	%
Income before income tax expense	38,759			23,445			34,464			65.3	%	(32.0)	%
Income tax expense	7,647			4,887			6,574			56.5	%	(25.7)	%
Net income from continuing operations	$	31,112		$	18,558		$	27,890		67.6	%	(33.5)	%
Income from discontinued operations, net of tax	$	4,004		$	610		$	2,169		556.4	%	(71.9)	%
Net income	$	35,116		$	19,168		$	30,059		83.2	%	(36.2)	%
Diluted earnings per share from continuing operations	$	2.31		$	1.35		$	2.02		71.1	%	(33.2)	%
Diluted earnings per share from discontinued operations	$	0.30		$	0.04		$	0.16		650.0	%	(75.0)	%
Diluted earnings per share	$	2.61		$	1.39		$	2.18		87.8	%	(36.2)	%
Return on average assets	1.43		%	0.82		%	1.24		%	—		—
Return on average equity	14.98		%	8.37		%	14.24		%	—		—

(In thousands except per share data)	For the Years Ended December 31,									% Change
	2024			2023			2022			2024 v. 2023		2023 v. 2022
Processing fees	$	82,671		$	79,566		$	76,470		3.9	%	4.0	%
Financial fees	43,297			45,985			43,757			(5.8)	%	5.1	%
Net interest income	67,787			66,494			58,844			1.9	%	13.0	%
Provision for (release of) credit losses	447			(550)			1,350			(181.3)	%	(140.7)	%
Other	5,881			4,916			4,755			19.6	%	3.4	%
Total revenues	199,189			197,511			182,476			0.8	%	8.2	%
Operating expense	174,970			160,155			139,576			9.3	%	14.7	%
Income before income tax expense	24,219			37,356			42,900			(35.2)	%	(12.9)	%
Income tax expense	5,051			7,297			7,996			(30.8)	%	(8.7)	%
Net income	$	19,168		$	30,059		$	34,904		(36.2)	%	(13.9)	%
Diluted earnings per share	$	1.39		$	2.18		$	2.53		(36.2)	%	(13.8)	%
Return on average assets	0.82		%	1.24		%	1.35		%	—		—
Return on average equity	8.37		%	14.24		%	16.53		%	—		—

The Company recorded revenue of $190.8 million in 2025, up 5.3% from the prior year, largely due to an increase in net interest income, partially offset by a decrease in financial fees and a loss on sale of investment securities. Operating expense decreased 3.6% in 2025, largely driven by $7.8 million of bad debt expense in 2024 and $2.0 million of bad debt recovery experienced in 2025. Net income was $35.1 million and diluted EPS was $2.61 per share in 2025, increases of 83.2% and 87.8%, respectively, from the prior year.

The Company ~~recorded~~posted ~~revenue~~a ~~of $199~~1.~~2 million in December 31, 2024, up 0.8~~43% ~~from~~return ~~the~~on ~~prior~~average ~~year,~~assets ~~due to increases in processing fees~~ and ~~net interest income, partially offset by a decrease in financial fees and the negative variance in the provision for (release of) credit losses~~14. ~~Operating expenses increased 9.3~~98% ~~largely~~return ~~driven by $7.8 million of bad debt expense experienced~~ on aaverage ~~funding~~equity ~~receivable related to a facility client as well as a one-time non-cash expense of $3.5 million~~ in ~~the fourth quarter of 2024 related to the termination of its noncontributory defined-benefit pension plan~~2025. ~~Net income was $19.2 million and diluted EPS was $1.39 per share, decreases of 36.2% for both from the prior year.~~

The Company posted a 0.82% return on average assets and 8.37% return on average equity. The Company did not have any nonperforming assets at December 31, 2024 and did not have any loan charge-offs during 2024.

Further detail about the components of revenue and expenses are explained in the sections following.

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Fee Revenue and Other Income

The Company’s fee revenue is derived mainly from transportation and facility payment and processing fees. As the Company provides its processing and payment services, it is compensated by service fees which are typically calculated on a per-item basis, discounts received for services provided to carriers and by the accounts and drafts payable balances generated in the payment process which can be used to generate interest income. Processing volumes, average payments in advance of funding, fee revenue and other income were as follows:

(In thousands)	December 31,						% Change
	2024		2023		2022			2024 v. 2023		2023 v. 2022
	2025		2024		2023			2025 v. 2024		2024 v. 2023
Transportation invoice transaction volume	35,729		35,949		36,807			(0.6)	%	(2.3)	%
Transportation invoice volume	34,451		35,729		35,949			(3.6)	%	(0.6)	%
Transportation invoice dollar volume	$	36,113,169	$	38,288,478	$	44,749,359		(5.7)	%	(14.4)	%
Transportation dollar volume	$	36,447,471	$	36,113,169	$	38,288,478		0.9	%	(5.7)	%
Facility transaction volume(1)	17,135		13,857		12,990			23.7	%	6.7	%
Facility expense invoice volume	16,508		16,572		13,220			(0.4)	%	25.4	%
Facility dollar volume(1)	$	21,438,282	$	19,836,821	$	19,514,049		8.1	%	1.7	%
Facility expense dollar volume	$	23,256,090	$	20,272,451	$	18,599,214		14.7	%	9.0	%
Average payments in advance of funding	$	~~202~~175,~~860~~129	$	~~234~~202,~~865~~860	$	~~278~~234,~~185~~865		(13.67)	%	(1513.6)	%
Processing fees	$	8266,~~671~~129	$	7966,~~566~~061	$	7659,~~470~~670		30.91	%	410.07	%
Financial fees	$	4340,~~297~~398	$	4542,~~985~~584	$	4345,~~757~~339		(5.81)	%	5(6.1)	%
Other income	$	56,~~881~~865	$	45,~~916~~247	$	45,~~755~~089		1930.68	%	3.41	%
Loss on sale of investment securities	$	(3,534)	$	(45)	$	(173)		N/M		(74.0)	%

(Processing fees increased $68,000, or 0.1~~)Includes~~%, ~~utility~~during 2025 compared to 2024, ~~telecom~~due to the AcuAudit acquisition in December 2024, partially offset by decreases in facility and ~~waste~~transportation volumes of 0.4% and 3.6%, respectively. The decline in transportation volumes was primarily due to the on-going freight recession and the impact of tariffs. Facility expense invoice volumes were flat in 2025 after experiencing 25.4% growth in 2024.

~~Processing~~Financial fees ~~increased~~decreased $32.12 million, or 35.91%, ~~during~~in 2025 compared to 2024, ~~largely~~which ~~driven~~was byprimarily attributable to a 2313.7% ~~increase~~decrease in ~~facility~~average ~~transaction~~payments ~~volumes.~~in ~~Transportation~~advance ~~invoice~~of ~~volumes~~funding ~~decreased~~in ~~0.6%~~addition ~~over~~to the ~~same~~changes ~~period~~in the manner in which facility vendors receive payments. ~~The~~Average ~~decline~~payments in ~~transportation~~advance ~~volumes~~of isfunding ~~primarily~~declined in 2025 compared to 2024 due to the ~~on-going~~consolidation of freight ~~recession~~carriers, partially offset by a 0.9% increase in transportation dollar volumes.

~~Financial~~Other ~~fees~~income ~~decreased~~increased $21.76 million, or 530.8%, induring ~~2024~~2025 ~~primarily~~compared ~~attributable~~ to ~~the~~2024 ~~decline~~primarily indue ~~transportation~~to ~~invoice~~higher ~~dollar~~bank-owned ~~volumes~~life ofinsurance ~~5.7%.~~income ~~The~~as ~~decline~~well inas ~~transportation~~growth ~~invoice dollar volumes had a direct effect on the 13.6% decrease~~ in ~~average~~TouchPoint ~~payments~~related inchurch ~~advance~~management ofsoftware ~~funding, which is the primary generator of financial~~ fees.

~~Other~~The ~~income~~Company ~~increased~~sold $~~965,000,~~34.0 ormillion 19of corporate investment securities with a weighted-average yield of 2.629%, at a loss of $3.5 million in ~~2024~~June ~~largely~~2025 ~~due~~in an effort to ~~higher~~reposition ~~bank-owned~~the ~~life~~investment ~~insurance~~portfolio ~~revenue~~and improve the net interest margin and ~~TouchPoint~~net ~~fees~~interest income in future periods.

Net Interest Income

Net interest income is the difference between interest earned on loans, investments, and other earning assets and interest expense on deposits and other interest-bearing liabilities. Net interest income is a significant source of the Company’s revenues. The following table summarizes the changes in tax-equivalent net interest income and related factors:

(In thousands)	December 31,									~~% Change~~		% Change
	2024			2023			2022			2024 v. 2023		2023 v. 2022
	2025			2024			2023					2025 v. 2024		2024 v. 2023
Average earning assets	$	2,~~011~~148,~~554~~402		$	2,~~076~~011,~~951~~554		$	2,~~205~~076,~~792~~951		~~(3.1)~~	%	(56.8)	%	(3.1)	%
Average interest-bearing liabilities	$	~~634~~617,~~592~~281		$	~~573~~634,~~308~~592		$	~~603~~573,~~262~~308		~~10.7~~	%	(52.07)	%	10.7	%
Net interest income (1)	$	6882,~~798~~320		$	6768,~~583~~798		$	6067,~~533~~583		~~1.8~~	%	1119.67	%	1.8	%
Net interest margin (1)	3.4283		%	3.2542		%	23.7425		%	—		—		—
Yield on earning assets (1)	4.4359		%	4.0443		%	24.9004		%	—		—		—
Rate on interest bearing liabilities	32.1964		%	23.8419		%	02.5884		%	—		—		—

(1)Presented on a tax-equivalent basis using a tax rate of 21%.

The increase in net interest income in 2024 as compared to 2023 is primarily due to an increase in the net interest margin to 3.42% as compared to 3.25% in the prior year. The increase in the net interest margin was partially offset by a decrease in average earning assets of $65.4 million, or 3.1%. The yield on interest-earning assets increased 39 basis points from 4.04% 27

Table of Contents

The $13.5 million increase in ~~2023~~net interest income in 2025 as compared to 2024 was primarily due to an increase in net interest margin to 3.83% as compared to 3.42% in the prior year, in addition to the increase in average earning assets of $136.8 million, or 6.8%. The yield on interest-earning assets increased 16 basis points from 4.43% in 2024 to 4.59% in 2025 while the cost of interest-bearing liabilities ~~increased~~decreased 3555 basis points from 23.8419% in ~~2023~~2024 to 32.1964% in ~~2024~~2025.

Average loans ~~decreased~~increased $654.93 million, or 05.72%, in 2025 compared to 2024, to $1.0510 billion. ~~This~~The ~~decrease~~Company ~~was~~experienced ~~due~~significant toloan growth during the ~~Company~~first ~~opting~~quarter toof be2025 ~~more~~and ~~selective~~then ina ~~booking~~subsequent ~~new~~decline in loans asduring athe ~~result~~remainder of athe ~~decline in average deposits~~year. The average yield on loans increased 4737 basis points to 5.2865% in ~~2024~~2025.

Average investment securities ~~decreased~~increased $9758.58 million, or 139.32%, ~~due~~in to2025 ~~the~~compared ~~sale~~to ~~and~~2024. ~~maturity~~The ofincrease ~~investment~~was ~~securities~~driven ~~throughout~~by ~~2024.~~the ~~The~~utilization ~~investment~~of ~~portfolio~~available ~~will~~liquidity ~~expand~~arising ~~and~~from ~~contract~~an ~~over~~increase ~~time~~in asaverage ~~the~~accounts ~~Company~~and ~~manages~~drafts ~~its~~payable ~~liquidity~~to ~~and~~purchase ~~interest~~investment ~~rate position~~securities. The average ~~tax-equivalent~~ yield on taxable investment securities increased 1941 basis points to 23.8224% inand ~~2024~~the asaverage ayield ~~result~~on oftax-exempt ~~purchases of new~~ investment securities atincreased ~~current~~43 ~~market~~basis ~~interest~~points ~~rates,~~to ~~which are higher than the average interest rate in the current investment portfolio~~3. 22%.

Average short-term investments, consisting of interest-bearing deposits in other financial institutions and federal funds sold, increased $3923.07 million, or 137.63% in 2025 compared to 2024. The increase is primarily a result of the ~~decline~~increase in average ~~investment~~funding ~~securities and loans~~sources, partially offset by athe ~~decrease~~increase in average ~~funding~~loans ~~sources~~and average investment securities. The average yield on short-term investments ~~increased~~decreased 588 basis points to 43.8395% ~~in 2024~~ primarily due to the ~~higher~~decrease ~~short-term~~in ~~market~~the ~~interest~~Federal ~~rates~~Funds ~~when comparing the periods~~rate. The majority of these short-term investments are held at the Federal Reserve Bank.

The average balance of interest-bearing deposits ~~increased~~decreased $6317.5 million, or 112.18% in 2025 compared to 2024. Average non-interest-bearing demand deposits decreased $978.92 million, or 192.10%. The Company has experienced adeposit ~~migration~~attrition ofdue ~~client funds from non-interest bearing~~ to ~~interest-bearing~~a ~~driven~~decrease byin the ~~higher~~overall ~~interest~~level ~~rate~~of ~~environment~~some ~~prior~~larger tocommercial ~~the~~deposits ~~recent~~due ~~100~~to ~~basis~~client ~~point~~funding ~~decline~~needs infor ~~the~~acquisitions ~~Federal~~and ~~Funds~~other ~~rate~~purposes. The average rate paid on interest-bearing deposits ~~increased~~decreased 3655 basis points to 32.1964% in ~~2024~~2025 due to ~~higher~~the ~~average~~decrease ~~short-term~~in ~~interest~~the ~~rates~~Federal Funds rate.

Average accounts and drafts payable ~~decreased~~increased $50150.73 million, or 414.79%., ~~The decrease~~ in ~~these~~2025 ~~balances,~~compared ~~which~~to ~~are non-interest bearing~~2024, ~~are~~to ~~primarily~~$1.16 ~~reflective~~billion. ofThe aincrease ~~cyber~~in ~~event~~average ataccounts aand ~~CassPay~~drafts ~~client~~payable ~~during~~was ~~the~~primarily ~~first~~driven ~~quarter of 2024, which decreased average balances~~ by ~~approximately~~the ~~$100.0~~increase ~~million, and a decrease~~ in ~~transportation~~facility dollar volumes of 014.67%, ~~partially~~as ~~offset~~well byas anthe increase in ~~facility~~transportation dollar volumes of 80.19%. ~~Accounts and drafts payable are a significant source of funding generated by payment float from transportation and facility clients.~~

Distribution of Assets, Liabilities and Shareholders' Equity; Interest Rate and Interest Differential

The following table contains condensed average balance sheets for each of the periods reported, the tax-equivalent interest income and expense on each category of interest-earning assets and interest-bearing liabilities, and the average yield on such categories of interest-earning assets and the average rates paid on such categories of interest-bearing liabilities for each of the periods reported:

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Table of Contents

(In thousands)	~~2024~~2025								~~2023~~2024												~~2022~~2023
	AverageBalance		InterestIncome/Expense		Yield/ Rate		~~Yield/ Rate~~		Average Balance		~~Average Balance~~		Interest Income/Expense		~~Interest Income/Expense~~		Yield/ Rate		~~Yield/ Rate~~		Average Balance		~~Average Balance~~		Interest Income/Expense		Yield/ Rate
Assets (1)
Interest-earning assets
Loans (2):	$	1,~~048~~103,~~732~~067	$	5562,~~362~~340	5.65	%	~~5.28~~	%	$	1,048,732	$	~~1,055,668~~	$	55,362	$	~~50,825~~	5.28	%	~~4.81~~	%	$	1,055,668	$	~~992,004~~	$	3950,~~460~~825	34.9881	%
Securities (4):
Investment securities (4):
Taxable	~~474~~535,~~753~~416		1317,~~423~~328		3.24		~~2.83~~		474,753		~~541,159~~		13,423		~~14,118~~		2.83		~~2.61~~		541,159		~~509,537~~		1014,~~083~~118		12.9861
Tax-exempt (3)	~~161~~160,~~836~~019		45,~~519~~145		3.22		~~2.79~~		161,836		~~192,881~~		4,519		~~5,186~~		2.79		~~2.69~~		192,881		~~279,247~~		85,~~043~~186		2.8869
Short-term investments	~~326~~349,~~233~~900		1513,~~752~~834		3.95		~~4.83~~		326,233		~~287,243~~		15,752		~~13,720~~		4.83		~~4.78~~		287,243		~~425,004~~		613,~~429~~720		14.5178
Total interest-earning assets	2,~~011~~148,~~554~~402		8998,~~056~~647		4.59	%	~~4.43~~	%	2,011,554		~~2,076,951~~		89,056		~~83,849~~		4.43	%	~~4.04~~	%	2,076,951		~~2,205,792~~		6483,~~015~~849		24.9004	%
Non-interest-earning assets
Cash and due from banks	2321,~~695~~741								23,695		~~24,914~~										24,914		~~20,772~~
Premises and equipment, net	3330,~~309~~917								31,125		~~24,445~~										23,141		~~19,291~~
Payments in advance of funding	~~202~~175,~~860~~129								202,860		~~234,865~~										234,865		~~278,185~~
Bank-owned life insurance	4951,~~715~~183								49,715		~~48,540~~										48,540		~~46,468~~
Goodwill and other intangibles	20,~~314~~515								15,182		~~21,060~~										15,856		~~19,558~~
Unrealized (loss) gain on investment securities	(57,772)										(68,893)												(43,147)
Unrealized loss on investment securities	(47,093)								(57,772)												(68,893)
Other assets	7966,~~091~~116								72,358		~~71,050~~										63,777		~~51,686~~
Allowance for credit losses	(1314,~~369~~014)								(13,369)		~~(13,324)~~										(13,324)		~~(12,527)~~
Total assets	$	2,349,397									$	2,419,608											$	2,586,078
Assets of discontinued operations	7,518								14,049												13,781
Liabilities and Shareholders’ Equity (1)
Total assets	$	2,460,414							$	2,349,397											$	2,419,608
Interest-bearing liabilities
Liabilities and Shareholders’ Equity (1)
Interest-bearing demand deposits	$	549,164	$	17,028			3.10	%			$	496,154			$	14,056			2.83	%			$	549,054	$	3,118	0.57	%
Interest-bearing liabilities
Savings deposits	7,148		116				1.62				7,162				113				1.58				13,288		38		0.29
Interest-bearing demand deposits	$	522,010	$	13,153	2.52	%			$	549,164			$	17,029			3.10	%			$	496,154			$	14,056	2.83	%
Time deposits >=$250	27,211		597				2.19				23,912				417				1.74				18,272		102		0.56
Savings deposits	7,032		92		1.31				7,148				116				1.62				7,162				113		1.58
Other time deposits	51,058		2,516				4.93				43,839				1,564				3.57				22,637		224		0.99
Time deposits >=$250	23,294		813		1.96				27,211				597				2.19				23,912				417		1.74
Total interest-bearing deposits	634,581		20,257				3.19				571,067				16,150				2.83				603,251		3,482		0.58
Other time deposits	64,783		2,260		4.17				51,058				2,516				4.93				43,839				1,564		3.57
Short-term borrowings	11		1				9.09				2,241				116				5.18				11		—		—
Total interest-bearing deposits	617,119		16,318		2.64				634,581				20,258				3.19				571,067				16,150		2.83
Total interest-bearing liabilities	634,592		20,258				3.19	%			573,308				16,266				2.84	%			603,262		3,482		0.58	%
Short-term borrowings	162		9		5.56				11				—				9.09				2,241				116		5.18
Noninterest-bearing liabilities
Total interest-bearing liabilities	617,281		16,327		2.64	%			634,592				20,258				3.19	%			573,308				16,266		2.84	%
Demand deposits	414,711										512,608												588,121
Non-interest bearing liabilities
Accounts and drafts payable	1,030,520										1,081,245												1,141,329
Demand deposits	406,551								414,711												512,608
Other liabilities	40,630										41,378												42,224
Accounts and drafts payable	1,160,018								1,009,757												1,059,286
Total liabilities	2,120,453										2,208,539												2,374,936
Other liabilities	40,782								37,933												38,501
Shareholders’ equity	228,944										211,069												211,142
Liabilities of discontinued operations	1,301								23,460												24,836
Total liabilities and shareholders’ equity	$	2,349,397									$	2,419,608											$	2,586,078
Total liabilities	2,225,933								2,120,453												2,208,539
Net interest income (3)			$	68,798											$	67,583									$	60,533
Shareholders’ equity	234,481								228,944												211,069
Net interest margin (3)							3.42	%											3.25	%							2.74	%
Total liabilities and shareholders’ equity	$	2,460,414							$	2,349,397											$	2,419,608
Interest spread							1.23	%											1.20	%							2.32	%
Net interest income (3)			$	82,320									$	68,798											$	67,583
Net interest margin (3)					3.83	%											3.42	%									3.25	%
Interest spread					1.95	%											1.23	%									1.20	%

(1)Balances shown are daily averages.

(2)Interest income on loans includes net loan fees of $~~477~~744,000, $~~686~~477,000, and $~~684~~686,000 for ~~2024~~2025, ~~2023 and 2022, respectively. Loan fees include $0, $0, and $167,000 of Paycheck Protection Program ("PPP") loan fees for~~ 2024, ~~2023~~ and ~~2022~~2023, respectively.

(3)Interest income is presented on a tax-equivalent basis assuming a tax rate of 21%. The tax-equivalent adjustment was approximately $1.01 million, $1.10 million, and $1.71 million for ~~2024~~2025, ~~2023~~2024, and ~~2022~~2023, respectively.

(4)For purposes of these computations, yields on investment securities are computed as interest income divided by the average amortized cost of the investments.

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Analysis of Net Interest Income Changes

The following table presents the changes in interest income and expense between years due to changes in volume and interest rates.

(In thousands)

~~2024~~2025 Over ~~2023~~2024

~~2023~~2024 Over ~~2022~~2023

Volume (1)

Rate (1)

Total

Volume(1)

Rate (1)

Total

Increase (decrease) in interest income:

Loans (2):

~~(338)~~2,954

4,~~875~~024

46,~~537~~978

~~2,657~~(338)

84,~~708~~875

114,~~365~~537

Securities:

Investment securities:

Taxable

(1,~~823)~~832

12,~~128~~073

~~(695)~~3,905

~~658~~(1,823)

31,~~377~~128

~~4,035~~(695)

Tax-exempt (3)

(~~862~~51)

~~195~~677

~~(667)~~626

(~~2,351~~862)

~~(506)~~195

(~~2,857~~667)

Short-term investments

1,~~881~~079

~~151~~(2,997)

2(1,~~032~~918)

(21,~~671)~~881

~~9,962~~151

72,~~291~~032

Total interest income

(15,~~142)~~814

63,~~349~~777

59,~~207~~591

(1,~~707~~142)

216,~~541~~349

195,~~834~~207

Interest expense on:

Interest-bearing demand deposits

~~1,577~~(809)

1(3,~~395~~067)

2(3,~~972~~876)

~~(329)~~1,577

111,~~267~~396

102,~~938~~973

Savings deposits

—(2)

3(22)

3(24)

~~(25)~~—

~~100~~3

753

Time deposits >=$250

63(96)

~~117~~312

~~180~~216

4063

~~275~~117

~~315~~180

Other time deposits

~~287~~580

~~665~~(836)

~~952~~(256)

~~354~~287

~~986~~665

~~1,340~~952

Short-term borrowings

~~(165)~~—

509

~~(115)~~9

—(58)

~~116~~(58)

(116)

Total interest expense

~~1,762~~(327)

2(3,~~230~~604)

(3,~~992~~931)

401,869

122,~~744~~123

123,~~784~~992

Net interest income

(26,~~904)~~141

47,~~119~~381

113,~~215~~522

(13,~~747~~011)

84,~~797~~226

71,~~050~~215

(1)The change in interest due to the combined rate/volume variance has been allocated in proportion to the absolute dollar amounts of the change in each.

(2)Interest income includes net loan fees.

(3)Interest income is presented on a tax-equivalent basis assuming a tax rate of 21%.

Loan Portfolio

Interest earned on the loan portfolio is a primary source of income for the Company. The loan portfolio was $1.0806 billion, representing 4540.27% of the Company's total assets as of December 31, ~~2024~~2025 and generated $5562.43 million in interest income during the year ended December 31, ~~2024~~2025. The following tables show the composition of the loan portfolio at the end of the periods indicated and remaining maturities for loans as of December 31, ~~2024~~2025.

Loans by Type

December 31,

(In thousands)

~~2024~~2025

~~2023~~2024

~~2022~~2023

Commercial and industrial

~~559~~553,~~262~~080

~~498~~559,~~502~~262

~~561~~498,~~616~~502

Real estate (commercial and faith-based):

Mortgage

~~488~~459,~~075~~879

~~499~~488,~~739~~075

~~495~~499,~~280~~739

Construction

3448,~~652~~231

1634,~~023~~652

2516,~~968~~023

Other

—27

54—

4254

Total loans

1,~~081~~061,~~989~~217

1,~~014~~081,~~318~~989

1,~~082~~014,~~906~~318

~~The~~At December 31, 2025, the Company ~~does~~did not have any foreign loans. ~~The~~or ~~Company's loan portfolio includes $110,000 of~~ single family real estate mortgages, as the Company does not market its services to retail customers. Also, the Company had no sub-prime mortgage loans or residential development loans in its portfolio in any of the years presented.

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Loans by Maturity as of December 31, ~~2024~~2025

(In thousands)	One YearOr Less				Over 1 YearThrough 5 Years				Over 5 Years Through 15 Years (1)				Total
	FixedRate		FloatingRate		FixedRate		FloatingRate		FixedRate		FloatingRate
Commercial and industrial	$	4135,~~723~~054	$	5861,~~439~~783	$	~~204~~235,~~118~~252	$	2617,~~622~~573	$	~~211~~189,~~391~~599	$	1613,~~969~~819	$	~~559~~553,~~262~~080
Real Estate:
Mortgage	78,~~873~~382		2517,~~777~~191		~~304~~276,~~990~~860		1213,~~115~~156		6674,~~320~~290		—		~~488~~459,~~075~~879
Construction	1225,~~638~~586		2718,799		~~13,654~~—		83,~~333~~846		—		—		3448,~~652~~231
Total loans	$	133,234	$	84,243	$	522,762	$	47,070	$	277,711	$	16,969	$	1,081,989
Other	—		27		—		—		—		—		27
Total loans	$	139,022	$	97,800	$	512,112	$	34,575	$	263,889	$	13,819	$	1,061,217

(1)The Company did not have any loans with maturities greater than 15 years.

The Company has no concentrations of loans exceeding 10% of total loans, which are not otherwise disclosed in the loan portfolio composition table and as are discussed in Item 8, Note 45, of this report. The Company's primary market niche for banking services is privately held businesses, franchise restaurants, and faith-based ministries.

Loans to commercial entities are generally secured by the business assets of the borrower, including accounts receivable, inventory, machinery and equipment, and the real estate from which the borrower operates. Operating lines of credit to these companies generally are secured by accounts receivable and inventory, with specific percentages of each determined on a customer-by-customer basis based on various factors including the type of business. Intermediate term credit for machinery and equipment is generally provided at some percentage of the value of the equipment purchased, depending on the type of machinery or equipment purchased by the entity. Loans secured exclusively by real estate to businesses and faith-based ministries are generally made with a maximum 80% loan to value ratio, depending upon the Company's estimate of the resale value and ability of the property to generate cash. The Company's loan policy requires an independent appraisal for all loans over $500,000 secured by real estate. Company management monitors the local economy in an attempt to determine whether it has had a significant deteriorating effect on such real estate loans. When problems are identified, appraised values are updated on a continual basis, either internally or through an updated external appraisal.

Loans ~~increased~~decreased $6720.78 million, or 61.79%, to $1.0806 billion at December 31, 2025 as compared to December 31, 2024. Franchise restaurant loans, which are included in commercial and industrial loans, ~~increased~~decreased $4322.1 million during ~~2024~~2025. Faith-based loans increased $53.2 million, during ~~2024~~2025. Additional details regarding the types and maturities of loans in the loan portfolio are contained in the tables above and in Item 8, Note 45.

Performing loans subject to special monitoring increased from $5.5 million at December 31, 2023 to $51.2 million at December 31, 2024. These loans possess some credit deficiency or potential weakness which requires a higher level of management attention. The increase during 2024 is primarily due to a large franchise restaurant relationship that has experienced some level of financial weakness. However, the Company does not believe there is any concern of credit loss at December 31, 2024.

Provision and Allowance for Credit Losses on Loans and Allowance for Unfunded Commitments

The Company recorded a provision for credit losses and off-balance sheet credit exposures of $~~447~~348,000 ~~in 2024~~ and ~~a release of credit losses of~~ $~~550~~447,000 in ~~2023~~2025 and 2024, respectively. The amount of the provision for ~~(release of)~~ credit losses was derived from the Company’s CECL model. The amount of the provision will fluctuate as determined by these analyses. The Company had no loan charge-offs or recoveries in ~~2024~~2025 and ~~2023~~2024. The ACL was $13.46 million at December 31, ~~2024~~2025 compared to $13.14 million at December 31, ~~2023~~2024. The ACL represented 1.2428% and 1.2924% of outstanding loans at December 31, ~~2024~~2025 and December 31, ~~2023~~2024, respectively. The allowance for unfunded commitments was $~~273~~419,000 at December 31, ~~2024~~2025 and $~~132~~273,000 at December 31, ~~2023~~2024. ~~There~~The ~~were~~balance noof nonperforming loans outstanding was $7.0 million at December 31, ~~2024~~2025 orand $0 at December 31, ~~2023~~2024.

The ACL has been established and is maintained to estimate the lifetime credit losses expected in the loan portfolio. An ongoing assessment is performed to determine if the balance is adequate. Charges or credits are made to expense based on changes in the economic forecast, qualitative risk factors, loan volume, and individual loans. For loans that are individually evaluated, the Company uses two impairment measurement methods: 1) the present value of expected future cash flows and 2) collateral values.

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evaluated, the Company uses two impairment measurement methods: 1) the present value of expected future cash flows and 2) collateral values.

Federal and state regulatory agencies review the Company’s methodology for maintaining the ACL. These agencies may require the Company to adjust the ACL based on their judgments and interpretations about information available to them at the time of their examinations.

The following schedule summarizes activity in the ACL and the allocation of the allowance to the Company’s loan categories.

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Summary of Credit Loss Experience

(In thousands)	December 31,
	2024			2023			2022			2021			2020
	2025			2024			2023			2022			2021
Allowance at beginning of year	$	13,~~089~~395		$	13,~~539~~089		$	1213,~~041~~539		$	1112,~~944~~041		$	11,~~279~~944
Loans charged-off:
Commercial and industrial	—			—			—			—			—
Real estate (commercial and faith-based):
Mortgage	—			—			—			—			—
Construction	—			—			—			—			—
Other	—			—			—			—			—
Total loans charged-off	—			—			—			—			—
Recoveries of loans previously charged-off:
Commercial and industrial	—			—			13—			1213			1912
Real estate (commercial and faith-based):
Mortgage	—			—			—			15—			115
Construction	—			—			—			—			—
Other	—			—			—			—			—
Total recoveries of loans previously charged-off	—			—			13—			2713			2027
Net loans recovered	—			—			~~(13)~~—			(2713)			(2027)
Provision for (release of) credit losses	~~306~~202			~~(450)~~306			~~1,485~~(450)			701,485			~~645~~70
Allowance at end of year	$	13,~~395~~597		$	13,~~089~~395		$	13,~~539~~089		$	1213,~~041~~539		$	1112,~~944~~041
Allowance for unfunded commitments at beginning of year	$	~~132~~273		$	~~232~~132		$	~~367~~232		$	~~567~~367		$	~~402~~567
Provision for (release of) credit losses	~~141~~146			~~(100)~~141			(~~135~~100)			(~~200~~135)			~~165~~(200)
Allowance for unfunded commitments at end of year	~~273~~419			~~132~~273			~~232~~132			~~367~~232			~~567~~367
Loans outstanding:
Average	$	1,~~048~~103,~~732~~067		$	1,~~055~~048,~~668~~732		$	~~992~~1,~~004~~055,668		$	~~887~~992,~~662~~004		$	~~906~~887,~~631~~662
December 31	1,~~081~~061,~~989~~217			1,~~014~~081,~~318~~989			1,~~082~~014,~~906~~318			~~960~~1,~~567~~082,906			~~891~~960,~~676~~567
Ratio of allowance for credit losses to loans outstanding at December 31	1.2428		%	1.2924		%	1.2529		%	1.25		%	1.3425		%
Ratio of net recoveries to average loans outstanding	—		%	—		%	—		%	—		%	—		%
Allocation of allowance for credit losses (1):
Commercial and industrial	$	5,~~897~~833		$	5,~~412~~897		$	5,~~977~~412		$	5,~~035~~977		$	45,~~635~~035
Real estate (commercial and faith-based):
Mortgage	7,~~281~~435			7,~~569~~281			7,~~378~~569			67,~~714~~378			6,~~892~~714
Construction	~~217~~329			~~108~~217			~~184~~108			~~292~~184			~~417~~292
Total	$	13,~~395~~597		$	13,~~089~~395		$	13,~~539~~089		$	1213,~~041~~539		$	1112,~~944~~041
Percentage of categories to total loans:
Commercial and industrial	5152.71		%	4951.17		%	5149.91		%	4651.9		%	3347.56		%
Real estate (commercial and faith-based):
Mortgage	4543.13			4945.31			4549.73			4845.37			48.73
Construction	34.26			13.62			21.46			42.14			54.51
PPP	—			—			—			0.7			12.3
Total	100.0		%	100.0		%	100.0		%	100.0		%	100.0		%

(1)Although specific allocations exist, the entire allowance is available to absorb losses in any particular loan category.

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Nonperforming Assets

Nonperforming loans are defined as loans on non-accrual status and loans 90 days or more past due but still accruing. Nonperforming assets include nonperforming loans plus foreclosed real estate. Loans with modifications to borrowers experiencing financial difficulty are not included in nonperforming loans unless they are on non-accrual status or past due 90 days or more.

It is the policy of the Company to continually monitor its loan portfolio and to discontinue the accrual of interest on any loan for which collection is not probable. Subsequent payments received on such loans are applied to principal if collection ~~of principal is not probable; otherwise, these receipts are recorded as interest income. There was no interest income recognized on nonaccrual loans for the years ended 2024 and 2023.~~

~~There were no nonaccrual loans at December 31, 2024 and December 31, 2023. There were no foreclosed assets at December 31, 2024 or December 31, 2023.~~33

~~The~~Table ~~Company~~of ~~does not have any other interest-earning assets which would have been included in nonaccrual, past due or restructured loans if such assets were loans.~~Contents

of principal is not probable; otherwise, these receipts are recorded as interest income. There was no interest income recognized on nonaccrual loans for the years ended 2025 and 2024.

There were three nonaccrual loans with a balance of $7.0 million at December 31, 2025 and none at December 31, 2024. There were no foreclosed assets at December 31, 2025 or December 31, 2024.

The Company did not have any other interest-earning assets which would have been included in nonaccrual, past due or restructured loans if such assets were loans.

Summary of Nonperforming Assets

(In thousands)	December 31,
	2024		2023		2022		2021		2020
	2025		2024		2023		2022		2021
Commercial and industrial:
Nonaccrual	$	—3,770	$	—	$	~~1,150~~—	$	—1,150	$	—
Total nonperforming loans	$	—	$	—	$	1,150	$	—	$	—
Contractually past due 90 days or more and still accruing	—		—		—		—		—
Real estate – mortgage:
Nonaccrual	3,222		—		—		—		—
Contractually past due 90 days or more and still accruing	—		—		—		—		—
Total nonperforming loans	$	6,992	$	—	$	—	$	1,150	$	—
Total foreclosed assets	—		—		—		—		—
Total nonperforming assets	$	—6,992	$	—	$	~~1,150~~—	$	—1,150	$	—

32Operating Expense

Operating expense in 2025 compared to 2024 and 2023 include the following significant pre-tax components:


(In thousands)	December 31,
	2025		2024		2023
Salaries and commissions	$	80,710	$	80,371	$	76,097
Share-based compensation	4,186		3,052		4,007
Employee profit sharing	6,284		4,452		5,815
Net periodic pension cost	—		4,169		878
Other benefits	18,886		17,293		17,591
Total personnel expense	$	110,066	$	109,337	$	104,388
Occupancy	2,767		2,695		2,799
Equipment	9,917		8,101		6,895
Bad debt (recovery) expense	(2,000)		7,847		—
Amortization of intangible assets	1,172		692		692
Other operating	30,069		29,070		27,731
Total operating expense	$	151,991	$	157,742	$	142,505

Total operating expense decreased 3.6% in 2025 compared to 2024 largely driven by the $2.0 million bad debt recovery in 2025 compared to a $7.8 million bad debt expense on a funding receivable related to a facility client in 2024.

Personnel expenses increased $729,000, or 0.7% in 2025 compared to 2024. Salaries and commissions increased $339,000, or 0.4%, as a result of the AcuAudit acquisition and merit increases, partially offset by a decrease in average full-time equivalent employees ("FTEs") of 5.4% due to strategic investments in various technology initiatives. Share-based

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~~Operating~~compensation ~~Expenses~~increased $1.1 million due to the improvement in earnings. Other benefits increased $1.6 million, or 9.2%, due to higher health insurance costs, partially offset by the decline in average FTEs.

~~Operating~~Net ~~expenses~~periodic pension cost decreased $4.2 million in ~~2024~~2025 compared to ~~2023~~2024. ~~and~~The ~~2022~~Company ~~include~~recorded a one-time non-cash expense of $3.5 million in the ~~following~~fourth ~~significant~~quarter ~~pre~~of 2024 related to the termination of its noncontributory defined-~~tax~~benefit ~~components:~~pension plan.

(In thousands)	December 31,
	2024		2023		2022
Salaries and commissions	$	96,356	$	93,474	$	85,489
Share-based compensation	3,167		4,139		6,732
Net periodic pension cost (benefit)	4,172		878		(2,453)
Other benefits	19,696		20,203		16,706
Total personnel expense	$	123,391	$	118,694	$	106,474
Occupancy	3,446		3,560		3,676
Equipment	8,305		7,138		6,668
Bad debt expense	7,847		—		—
Amortization of intangible assets	739		780		680
Other operating	31,242		29,983		22,078
Total operating expense	$	174,970	$	160,155	$	139,576

Equipment expense increased $1.8 million, or 22.4%, in 2025 compared to 2024, primarily due to an increase in depreciation expense on software related to recently completed technology initiatives.

~~Total~~The ~~operating~~$480,000 ~~expenses~~increase ~~increased~~in ~~9.3%~~amortization of intangible assets in ~~2024~~2025 compared to ~~2023~~2024 was driven by the AcuAudit acquisition in December 2024.

~~Salaries~~The ~~and~~$1.0 ~~commissions~~million ~~increased~~increase in other operating expense for 2025 includes a $21.91 million, orrestructuring ~~3.1%,~~charge asprimarily arelated ~~result~~to the consolidation of ~~merit~~the ~~increases~~Company's ~~and~~non-transportation aninvoice ~~increase~~and inpayment ~~average~~processing ~~full-time~~activities ~~equivalent~~into ~~employees~~a ~~("FTEs")~~single ofFacilities 1division.~~6%.~~

Share-based compensation decreased $1.0 million, reflecting the Company's financial performance and the impact on performance-based restricted stock between the periods.

Net periodic pension cost increased $3.3 million. The Company recorded a one-time non-cash expense of $3.5 million in the fourth quarter of 2024 related to the termination of its noncontributory defined-benefit pension plan. The termination of the plan is expected to reduce run rate operating expense by approximately $1.0 million on an annual basis.

Other benefits, such as 401(k) match, health insurance and payroll taxes decreased $507,000, or 2.5%.

Equipment expense increased $1.2 million, or 16.3%, primarily due to an increase in depreciation expense on software related to recently completed technology initiatives.

The Company recorded bad debt expense during 2024 of $7.8 million on a funding receivable related to a facility client. While the Company is in the process of litigation to collect the receivable, a full write-off to bad debt expense was recorded as a result of a credit analysis.

Other operating expense increased $1.3 million, or 4.2%, to $31.2 million. The Company incurred $1.3 million of late fees on facility transactions during 2024 driven by a check processing delay with a third-party vendor, the same CassPay client which incurred the cyber attack.

Income Tax Expense

Income tax expense in ~~2024~~2025 totaled $57.16 million, compared to $74.39 million in ~~2023~~2024. When measured as a percent of pre-tax income, the Company’s effective tax rate was 2019.970% and 1920.580% in ~~2024~~2025 and ~~2023~~2024, respectively. The ~~increase~~decrease in the effective tax rate in ~~2024~~2025 compared to ~~2023~~2024 ~~was~~is ~~primarily~~reflective ~~due~~of topurchases ~~a lower level~~ of tax-~~free~~exempt ~~interest income on~~ municipal investment securities induring ~~the~~2025 ~~current~~and ~~year, in addition to $304,000 of tax penalties incurred in 2024 on~~ the ~~surrender~~impact ~~and redeployment~~ of ~~bank-owned~~certain ~~life~~tax ~~insurance policies to increase future noninterest income~~credits.

Summary of Discontinued Operations


(In thousands except per share data)	For the Years Ended December 31,						% Change
	2025		2024		2023		2025 v. 2024		2024 v. 2023
Processing fees	$	7,630	$	15,795	$	17,837	(51.7)	%	(11.4)	%
Financial fees	888		713		646		24.5	%	10.4	%
Other	3,402		1,494		2,059		127.7	%	(27.4)	%
Gain on sale of TEM business	3,550		—		—		N/M		N/M
Total revenues	15,470		18,002		20,542		(14.1)	%	(12.4)	%
Operating expense	10,156		17,229		17,649		(41.1)	%	(2.4)	%
Income before income tax expense	5,314		773		2,893		587.5	%	(73.3)	%
Income tax expense	1,310		163		724		703.7	%	(77.5)	%
Net income from discontinued operations	$	4,004	$	610	$	2,169	556.4	%	(71.9)	%
Facility transaction volume	259		563		637		(54.0)	%	(11.6)	%
Facility dollar volume	$	501,626	$	1,165,831	$	1,237,607	(57.0)	%	(5.8)	%

Net income from discontinued operations for 2025 was $4.0 million, as compared to $610,000 in 2024, primarily reflecting a $3.6 million gain on the sale of the TEM business in June 2025.

Investment Portfolio

Investment securities ~~decreased~~available-for-sale increased $99242.18 million, or 1546.80%, during ~~2024~~2025 to $~~528~~770.08 million at December 31, ~~2024~~2025. UState and political securities increased $68.S2 million, or 39.7%, ~~Treasury~~to $240.2 million at December 31, 2025. Mortgage-backed securities ~~decreased~~increased $~~108~~245.74 million to $0478.7 million at December 31, ~~2024~~2025. ~~compared~~Corporate bonds decreased $58.9 million to $~~108~~28.79 million at December 31, 2025. The investment portfolio provides the Company with a significant source of earnings, secondary source of liquidity, and mechanisms to manage the effects of changes in loan demand and interest rates. Therefore, the size, asset allocation and maturity distribution of the investment portfolio will vary over time depending on management’s assessment of current and future interest rates, changes in loan demand, changes in the Company’s sources of funds and the economic outlook. During 2025, the Company purchased investment securities totaling $435.2 million and sold investment securities totaling $129.9 million, including the sale of $34.0 million of

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~~2023.~~corporate ~~State~~bonds ~~and~~in ~~political~~June ~~securities~~2025 ~~decreased $47.1 million, or 21.5%,~~ to ~~$172.0~~reposition ~~million~~the atinvestment ~~December 31, 2024~~portfolio. ~~Mortgage-backed securities increased $75.5 million, or 47.8%, to $233.3 million at December 31, 2024.~~ The ~~investment~~growth ~~portfolio provides the Company with a significant source of earnings, secondary source of liquidity, and mechanisms to manage the effects of changes~~ in ~~loan demand and interest rates. Therefore,~~ the ~~size, asset allocation and maturity distribution of the~~ investment portfolio ~~will~~was ~~vary~~primarily ~~over~~due ~~time~~to ~~depending~~utilization ~~on management’s assessment~~ of ~~current~~cash ~~and~~proceeds ~~future~~from ~~interest~~an ~~rates,~~increase ~~changes~~ in ~~loan~~funding ~~demand, changes in the Company’s~~ sources ~~of funds and the economic outlook~~. During 2024, the Company purchased investment securities totaling $119.7 million and sold investment securities totaling $60.1 million. The Company generally utilized funds from maturities and sales of U.S. Treasury securities and state and political securities to increase short-term investments and fund purchases of mortgage-backed securities.

There was no single issuer of securities in the investment portfolio at December 31, ~~2024~~2025 for which the aggregate amortized cost exceeded 10% of total shareholders' equity.

Investments by Type

(In thousands)

December 31,

2024

2023

2022

2025

2024

2023

State and political subdivisions

~~171~~240,~~964~~211

~~219~~171,~~035~~964

~~295~~219,~~126~~035

Mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises

~~233~~478,~~275~~696

~~157~~233,~~799~~275

~~173~~157,~~939~~799

Corporate bonds

8728,~~786~~896

~~102~~87,~~340~~786

85102,~~097~~340

Asset-backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises

3422,~~996~~969

3934,~~222~~996

4539,~~023~~222

Treasury securities

—

~~108,721~~—

~~155~~108,~~283~~721

Total investments

~~528~~770,~~021~~772

~~627~~528,~~117~~021

~~754~~627,~~468~~117

Investment Securities by Maturity
(At December 31, 2024)
(At December 31, 2025)
(In thousands)	Within 1Year			Over 1 to 5Years			Over 5 to10 Years			Over10 Years			Yield (1)
State and political subdivisions	$	85,~~820~~753		$	5748,~~494~~402		$	9290,~~565~~494		$	1395,~~085~~562		23.3437	%
Mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	—			~~466~~179			4551,~~641~~836			~~187~~426,~~169~~681			23.6287	%
Corporate bonds	—			4423,~~267~~401			435,~~519~~494			—			31.1296	%
Asset-backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	—			—			1,~~727~~380			3321,~~268~~590			54.5807	%
Total investments	$	85,~~820~~753		$	~~102~~71,~~227~~982		$	~~183~~149,~~452~~204		$	~~233~~543,~~522~~833		23.7865	%
Weighted average yield (1)	34.3853		%	32.6049		%	2.1333		%	34.0119		%	23.7865	%

(1)Yields are presented on a tax-equivalent basis assuming a tax rate of 21%.

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Deposits and Accounts and Drafts Payable

(In thousands)	December 31,
	2024		2023		2022
	2025		2024		2023
Noninterest-bearing demand deposits	$	~~251~~513,~~230~~434	$	~~524~~251,~~359~~230	$	~~642~~524,~~757~~359
Interest-bearing deposits	~~716,~~686,599		~~616~~716,~~455~~686		~~614~~616,~~460~~455
Total deposits	$	~~967~~1,~~916~~200,033	$	1967,~~140,814~~916	$	1,~~257~~140,~~217~~814
Accounts and drafts payable	$	1,~~149~~124,~~276~~858	$	1,~~071~~129,~~369~~610	$	1,~~067~~053,~~600~~269

Total deposits ~~decreased~~increased $~~172~~232.91 million, or 1524.20% during 2025 compared to 2024. Noninterest-bearing demand deposits ~~decreased~~increased $~~273~~262.12 million, or 52104.14%, to $~~251~~513.24 million at December 31, ~~2024~~2025 and interest-bearing deposits ~~increased~~decreased $~~100~~30.21 million, or 164.32%, to $~~716~~686.76 million at December 31, ~~2024~~2025. The ~~Company~~increase ~~has experienced a migration of client funds from non-interest bearing to interest-bearing driven by the higher interest rate environment prior to the recent 100 basis point cumulative decline~~ in ~~the Federal Funds rate in the fourth quarter of 2024. The decrease in~~ total deposits between the periods was ~~also~~ driven by timing of customer funds. The average balance of deposits is more indicative of trends period to period.

Accounts and drafts payable generated by the Company in its payment processing operations ~~increased~~decreased $774.98 million, or 70.34%, from the prior year to $1.1512 billion, at December 31, ~~2024~~2025. Due to the Company’s payment processing cycle, average balances are much more indicative of the underlying activity than period-end balances since point-in-time comparisons can be misleading if the comparison dates fall on different days of the week. Average accounts and drafts payable decreased $50.7 million, or 4.7%, to $1.03 billion during 2024. The decrease in these balances, which are non-interest bearing, are primarily reflective of a cyber event at a CassPay client during the first quarter of 2024, which decreased average balances by approximately $100.0 million, and a decrease in transportation dollar volumes of 0.6%, partially offset by an increase in facility dollar volumes of 8.1%.

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average balances are much more indicative of the underlying activity than period-end balances since point-in-time comparisons can be misleading if the comparison dates fall on different days of the week. Average accounts and drafts payable increased $150.3 million, or 14.9%, to $1.16 billion during 2025. The increase in these balances, which are non-interest bearing, are primarily reflective of the increase in transportation and facility dollar volumes of 0.9%, and 14.7%, respectively.

The composition of average deposits and the average rates paid on those deposits is represented in the table entitled “Distribution of Assets, Liabilities and Shareholders' Equity; Interest Rate and Interest Differential” which is included earlier in this discussion. The Company does not have any significant deposits from foreign depositors.

Maturities of Certificates of Deposit as of December 31, ~~2024~~2025

(In thousands)

$100 or Less

$100 to LessThan $250

$250 orMore

Total

Three months or less

31,~~384~~539

3859,~~468~~672

812,~~047~~305

4973,~~899~~516

Three to six months

~~731~~636

86,~~062~~128

49,~~526~~084

1315,~~319~~848

Six to twelve months

~~871~~423

62,~~806~~992

42,~~733~~999

126,~~410~~414

Over twelve months

~~390~~104

~~1,075~~742

~~4,371~~778

51,~~836~~624

Total

52,~~376~~702

5469,~~411~~534

2125,~~677~~166

8197,~~464~~402

Liquidity

The discipline of liquidity management as practiced by the Company seeks to ensure that funds are available to fulfill all payment obligations relating to invoices processed as they become due and meet depositor withdrawal requests and borrower credit demands while at the same time maximizing profitability. This is accomplished by balancing changes in demand for funds with changes in supply of funds. Primary liquidity to meet demand is provided by short-term liquid assets that can be converted to cash, maturing securities and the ability to obtain funds from external sources. The Company's Asset/Liability Committee (“ALCO”) has direct oversight responsibility for the Company's liquidity position and profile. Management considers both on-balance sheet and off-balance sheet items in its evaluation of liquidity.

The balance of liquid assets consists of cash and cash equivalents, which includes cash and due from banks, interest-bearing deposits in other financial institutions, federal funds sold, and money market funds. These balances totaled $~~349~~392.73 million at December 31, ~~2024~~2025, aan ~~decrease~~increase of $2242.75 million, or 612.12%, from December 31, ~~2023~~2024. The ~~decrease~~increase during 2025 is primarily attributed to an increase in deposits and a decrease in loans, partially offset by increases in securities available-for-sale and accounts and drafts receivable from customers. At December 31, 2025, cash and cash equivalents represented 15.1% of total assets and were the Company’s and its subsidiaries’ primary source of liquidity to meet future expected and unexpected loan demand, depositor withdrawals or reductions in accounts and drafts payable.

35Secondary sources of liquidity include the investment portfolio and borrowing lines. Total investment securities available-for-sale at fair value were $770.8 million at December 31, 2025, an increase of $242.8 million, or 46.0%, from December 31, 2024. Investment securities represented 29.6% of total assets at December 31, 2025. Of the total portfolio, 0.9% mature in one year or less, 9.2% mature after one year through five years and 89.9% mature after five years.

~~Table~~As of ~~Contents~~December 31, 2025, the Bank had unsecured lines of credit at six correspondent banks to purchase federal funds up to a maximum of $83.0 million in aggregate. As of December 31, 2025, the Bank had secured lines of credit with the Federal Home Loan Bank of $239.9 million collateralized by commercial mortgage loans. At December 31, 2025, the Company had lines of credit from three banks up to a maximum of $225.0 million in aggregate collateralized by state and political subdivision securities. There were no amounts outstanding at December 31, 2025 and 2024 under any of the lines of credit.

2024 is primarily attributed to a decrease in deposits and an increase in loans, partially offset by decreases in securities available-for-sale and accounts and drafts receivable from customers and an increase in accounts and drafts payable. At December 31, 2024, cash and cash equivalents represented 14.6% of total assets and are the Company’s and its subsidiaries’ primary source of liquidity to meet future expected and unexpected loan demand, depositor withdrawals or reductions in accounts and drafts payable.

Secondary sources of liquidity include the investment portfolio and borrowing lines. Total investment securities available-for-sale at fair value were $528.0 million at December 31, 2024, a decrease of $99.1 million, or 15.8%, from December 31, 2023. Investment securities represented 22.0% of total assets at December 31, 2024. Of the total portfolio, 1.7% mature in one year or less, 19.4% mature after one year through five years and 78.9% mature after five years.

As of December 31, 2024, the Bank had unsecured lines of credit at six correspondent banks to purchase federal funds up to a maximum of $83.0 million in aggregate. As of December 31, 2024, the Bank had secured lines of credit with the Federal Home Loan Bank of $183.6 million collateralized by commercial mortgage loans. At December 31, 2024, the Company had lines of credit from three banks up to a maximum of $250.0 million in aggregate collateralized by state and political subdivision securities. There were no amounts outstanding at December 31, 2024 and 2023 under any of the lines of credit.

The deposits of the Company's banking subsidiary have historically been stable, consisting of a sizable volume of core deposits related to customers that utilize many other commercial products of the Bank. The accounts and drafts payable generated by the Company have also historically been a stable source of funds.

Net cash flows provided by operating activities for the years ~~2024~~2025, ~~2023~~2024 and ~~2022~~2023 were $3837.94 million, $3638.9 million, and $5136.69 million, respectively. Net income plus depreciation and amortization accounts for most of the operating cash provided. Net cash flows from investing and financing activities fluctuate greatly as the Company actively manages its investment and loan portfolios and customer activity influences changes in deposit and accounts and drafts payable balances. Further analysis of the changes in these account balances is discussed earlier in this report. Due to the daily fluctuations in these account balances, management believes that the analysis of changes in average balances, also discussed earlier in this report, can be more indicative of underlying activity than the period-end balances used in the statements of cash flows. Management anticipates that cash and cash equivalents, maturing investments, cash from operations, and borrowing lines will continue to be sufficient to fund the Company’s operations and capital expenditures in 2025. The Company estimates that capital expenditures for 2025 should range from $6 million to $8 million. Capital expenditures in 2025 are expected to primarily consist of purchases of equipment and software related to the payment and information processing services business.

Net income plus amortization of intangible assets, net amortization of premium/discount on investment securities and depreciation of premises and equipment was $28.7 million and $39.5 million for the years ended December 31, 2024 and December 31, 2023, respectively, a decrease of $10.8 million year over year. The decrease was due to the decrease in net income of $10.9 million and lower net amortization of premium/discount on investment securities of $882,000, partially offset by an increase in depreciation of $1.1 million. The net amortization of premium/discount on investment securities is dependent on the type of securities purchased and changes in the prevailing market interest rate environment. 37

Other factors impacting the $2.0 million increase in net cash provided by operating activities include:

•A decrease in share-based compensation expense of $1.0 million;

•An increase in other operating activities, net of $8.2 million, primarily due to changes in various accounts receivable and payable;

•An increase in current income tax liability of $2.3 million;

•A change in the FASB ASC 715 pension adjustment of $2.6 million; and

•A change in the provision for (release of) credit losses of $1.0 million primarily due to changes in loans outstanding during the respective periods.

On an overall basis, the Company's $2.0 million increase in net cash provided by operating activities was primarily due to changes in cash flows from fluctuations in tax and other accounts offset by the decline in net income.

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~~significantly~~investment ~~impact~~and loan portfolios and customer activity influences changes in deposit and accounts and drafts payable balances. Further analysis of the ~~Company~~changes ~~include~~in these account balances is discussed earlier in this report. Due to the ~~general~~daily ~~levels~~fluctuations in these account balances, management believes that the analysis of ~~interest~~changes ~~rates~~in average balances, ~~business~~also discussed earlier in this report, can be more indicative of underlying activity than the period-end balances used in the statements of cash flows. Management anticipates that cash and cash equivalents, ~~inflation~~maturing investments, ~~and~~cash ~~energy~~from ~~costs~~operations, asand ~~well~~borrowing aslines ~~new~~will ~~business~~continue ~~opportunities~~to ~~available~~be sufficient to fund the Company’s operations and capital expenditures in 2025. The Company estimates that capital expenditures for 2026 should range from $4.0 million to $6.0 million. Capital expenditures in 2026 are expected to primarily consist of purchases of equipment and software related to the payment and information processing services business.

Net income plus amortization of intangible assets, net amortization of premium/discount on investment securities and depreciation of premises and equipment was $43.3 million and $28.5 million for the years ended December 31, 2025 and December 31, 2024, respectively, an increase of $14.8 million year over year. The increase was due to the increase in net income of $15.9 million, an increase in amortization of intangible assets of $480,000, and an increase in depreciation of $1.0 million, partially offset by lower net amortization of premium/discount on investment securities of $2.6 million. The net amortization of premium/discount on investment securities is dependent on the type of securities purchased and changes in the prevailing market interest rate environment.

Other factors impacting the $1.5 million decrease in net cash provided by operating activities include:

•A decrease in other operating activities, net of $15.9 million, primarily due to changes in various accounts receivable and payable;

•A decrease in the ASC 718 pension adjustment of $5.2 million; and

•A decrease in net cash used from discontinued operations of $3.6 million; partially offset by

•A smaller increase in accounts receivable, representing a positive variance of $3.5 million; and

•An increase in the current income tax liability of $4.4 million.

There are several trends and uncertainties that may impact the Company’s ability to generate revenues and income at the levels that it has in the past. In addition, these trends and uncertainties may impact available liquidity. Those that could significantly impact the Company include the general levels of interest rates, business activity, freight rates, inflation, and energy costs as well as new business opportunities available to the Company.

As a financial institution, a significant source of the Company’s earnings is generated from net interest income. Therefore, the prevailing interest rate environment is important to the Company’s performance. A major portion of the Company’s funding sources are the noninterest-bearing accounts and drafts payable generated from its payment and information processing services. Accordingly, higher levels of interest rates will generally allow the Company to earn more net interest income. Conversely, a lower interest rate environment will generally tend to depress net interest income. The Company actively manages its balance sheet in an effort to maximize net interest income as the interest rate environment changes. This balance sheet management impacts the mix of earning assets maintained by the Company at any point in time. For example, in a low interest rate environment, short-term relatively lower rate liquid investments may be reduced in favor of longer term relatively higher yielding investments and loans. If the primary source of liquidity is reduced in a low interest rate environment, a greater reliance would be placed on secondary sources of liquidity including borrowing lines, the ability of the Bank to generate deposits, and the investment portfolio to ensure overall liquidity remains at acceptable levels.

The overall level of economic activity can have a significant impact on the Company’s ability to generate revenues and income, as the volume and size of customer invoices processed may increase or decrease. Lower levels of economic activity decrease both fee income (as fewer invoices are processed) and balances of accounts and drafts payable generated (as fewer or lower average dollar invoices are processed) from the Company’s transportation customers.

The relative level of energy costs can impact the Company’s earnings and available liquidity. Lower levels of energy costs will tend to decrease transportation and ~~energy~~facility expense invoice amounts resulting in a corresponding decrease in accounts and drafts payable. Decreases in accounts and drafts payable generate lower interest income and reduce liquidity.

New business opportunities are an important component of the Company’s strategy to grow earnings and improve performance. Generating new customers allows the Company to leverage existing systems and facilities and grow revenues faster than expenses. During ~~2024~~2025, new business was added in both the transportation and facility expense management operations, driven by both successful marketing efforts and the solid market leadership position held by Cass.

~~Capital Resources~~38

One of management’s primary objectives is to maintain a strong capital base to warrant the confidence of customers, shareholders, and bank regulatory agencies. A strong capital base is needed to take advantage of profitable growth opportunities that arise and to provide assurance to depositors and creditors. The Company and its banking subsidiary continue to exceed all regulatory capital requirements, as evidenced by the capital ratios at December 31, 2024 as shown in Item 8, Note 2 of this report.

Cash dividends paid were $16.5 million and $16.0 million in 2024 and 2023, respectively.

Shareholders’ equity was $229.0 million, or 9.6% of total assets, at December 31, 2024, a decrease of $779,000 as compared to December 31, 2023. The decrease was primarily a result of the payment of cash dividends of $16.5 million, and the repurchase of treasury shares of $7.2 million, partially offset by net income of $19.2 million and the decrease in accumulated other comprehensive loss of $2.3 million.

Dividends from the Bank are a source of funds for payment of dividends by the Company to its shareholders. The only restrictions on dividends are those dictated by regulatory capital requirements, state corporate laws and prudent and sound banking principles. During 2024, the Bank paid dividends of $20.0 million to the Company. As of December 31, 2024, unappropriated retained earnings of $31.4 million were available at the Bank for the declaration of dividends to the Company without prior approval from regulatory authorities.

The Company maintains a treasury stock buyback program approved by the Board of Directors in October 2023 pursuant to which the Board of Directors has authorized the repurchase of up to 500,000 shares of the Company’s common stock and has no expiration date. A total of 318,581 shares remain under the buyback program at December 31, 2024.

The Company repurchased a total of 167,455 shares at an aggregate cost of $7.2 million during the year ended December 31, 2024 and 150,541 shares at an aggregate cost of $5.8 million during the year ended December 31, 2023. A portion of the repurchased shares may be used for the Company’s employee benefit plans and the balance will be available

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~~for~~Capital other general corporate purposes. The pace of future repurchase activity will depend on factors such as levels of regulatory capital, cash generation from operations, cash requirements for investments, repayment of debt, current stock price, business and market conditions, and other factors. The Company may repurchase shares from time to time on the open market or in private transactions, including structured transactions. The stock repurchase program may be modified or discontinued at any time.Resources

Cash dividends paid were $16.5 million for both 2025 and 2024.

Shareholders’ equity was $243.0 million, or 9.3% of total assets, at December 31, 2025, an increase of $14.0 million as compared to December 31, 2024. The increase was primarily a result of net income of $35.1 million and the decrease in accumulated other comprehensive loss of $18.4 million, partially offset by the payment of cash dividends of $16.5 million, and the repurchase of treasury shares of $26.0 million.

Dividends from the Bank are a source of funds for payment of dividends by the Company to its shareholders. The only restrictions on dividends are those dictated by regulatory capital requirements, state corporate laws and prudent and sound banking principles. During 2025, the Bank paid dividends of $20.0 million to the Company. As of December 31, 2025, unappropriated retained earnings of $31.1 million were available at the Bank for the declaration of dividends to the Company without prior approval from regulatory authorities.

The Company maintains a treasury stock buyback program approved by the Board of Directors in November 2025 pursuant to which the Board of Directors has authorized the repurchase of up to 1,000,000 shares of the Company’s common stock and has no expiration date. A total of 874,970 shares remain under the buyback program at December 31, 2025.

The Company repurchased a total of 617,415 shares at an aggregate cost of $26.0 million during the year ended December 31, 2025 and 167,455 shares at an aggregate cost of $7.2 million during the year ended December 31, 2024. A portion of the repurchased shares may be used for the Company’s employee benefit plans and the balance will be available for other general corporate purposes. The pace of future repurchase activity will depend on factors such as levels of regulatory capital, cash generation from operations, cash requirements for investments, repayment of debt, current stock price, business and market conditions, and other factors. The Company may repurchase shares from time to time on the open market or in private transactions, including structured transactions. The stock repurchase program may be modified or discontinued at any time.

Impact of Inflation

Inflation could have the impact of increasing ~~our~~the Company's operating expenses, such as compensation expense. Inflationary pressures may also have an impact on total assets, earnings and capital, which could impact the Company's ability to grow. An increase in total assets could have the impact of decreasing regulatory capital ratios if earnings and total regulatory capital do not increase at the same rate.

As a result of rising inflation, the Federal Reserve increased the Federal Funds rate throughout ~~2022~~2023 and ~~2023~~2024. The increase in the Federal Funds rate ~~has~~ contributed to the increase in the Company's net interest margin to 3.4283% in ~~2024~~2025 from 3.2542% in ~~2023~~2024 and 23.7425% in ~~2022~~2023, therefore positively impacting net interest income. The Federal Reserve began to decrease the Federal Funds rate during the last four months of 2024 by a cumulative 100 basis points and by another 75 basis points during the last four months of 2025. Further decreases in the Federal Funds rate resulting from softening inflation or other reasons could negatively impact the Company's net interest margin and income in ~~2025~~2026.

Critical Accounting Policies

The Company has prepared the consolidated financial statements in this report in accordance with the FASB Accounting Standards Codification (“ASC”). In preparing the consolidated financial statements, management makes estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. These estimates have been generally accurate in the past, have been consistent and have not required any material changes. There can be no assurances that actual results will not differ from those estimates. A summary of significant accounting policies and a summary of recent accounting pronouncements applicable to the Company's Consolidated Financial Statements are included in Item 8, "Financial Statements and Supplementary Data—Note 1.”

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The accounting policy that requires significant management estimates and is deemed critical to the Company’s results of operations or financial position has been discussed with the Audit and Risk Committee of the Board of Directors and is described below.

Allowance for Credit Losses. The Company performs periodic and systematic detailed reviews of its loan portfolio to determine management’s estimate of the lifetime expected credit losses. The process combines many factors: economic factors, historical credit loss experience, of both the Company and similar peer banks, loan portfolio growth and concentrations, asset quality, and other qualitative and quantitative factors which could affect future credit loss. Given the Company's recent historical loss experience, the impact of the qualitative risk factors related to the collective ACL is a substantial percentage of the overall ACL. Because current economic conditions and forecasts can change and future events are inherently difficult to predict, the anticipated amount of estimated credit losses, and therefore the appropriateness of the ACL, could change significantly. It is difficult to estimate how potential changes in any one economic factor or input might affect the overall allowance because a wide variety of factors and inputs are considered in estimating the ACL and changes in those factors and inputs considered may not occur at the same rate and may not be consistent across all loan types. Additionally, changes in factors and inputs may be directionally inconsistent, such that improvement in one factor may offset deterioration in others. Various regulatory agencies, as an integral part of the examination process, periodically review the ACL. Such agencies may require the Company to recognize additions to the ACL or reserve increases to adversely graded classified loans based on information available to them at the time of their examinations. The Company believes the level of ACL is appropriate. These policies affect both segments of the Company. The impact and associated risks related to these policies on the Company’s business operations are discussed in Note 1 "Summary of Significant Accounting Policies" and Note 45 "Loans," as well as the “Provision and Allowance for Credit Losses and Allowance for Unfunded Commitments” section of this report.

Commitments, Contractual Obligations and Off-Balance Sheet Arrangements

In the normal course of business, the Company is party to activities that involve credit, market and operational risk that are not reflected in whole or in part in the Company’s consolidated financial statements. Such activities include traditional off-balance sheet credit-related financial instruments. These financial instruments include commitments to extend credit, commercial letters of credit and standby letters of credit. The Company’s maximum potential exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit, commercial letters of credit and standby letters of credit is represented by the contractual amounts of those instruments. At December 31, 2025, an allowance for unfunded commitments of $419,000 had been recorded. See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Provision and Allowance for Credit Losses and Unfunded Commitments.”

38Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commercial and standby letters of credit are commitments issued by the Company or its subsidiaries to guarantee the performance of a customer to a third party. These off-balance sheet financial instruments generally have fixed expiration dates or other termination clauses and may require payment of a fee. At December 31, 2025, the balance of loan commitments, standby and commercial letters of credit were $172.7 million, $12.8 million and $782,000, respectively. Since some of the financial instruments may expire without being drawn upon, the total amounts do not necessarily represent future cash requirements. Commitments to extend credit and letters of credit are subject to the same underwriting standards as those financial instruments included on the consolidated balance sheets. The Company evaluates each customer’s credit worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary upon extension of the credit, is based on management’s credit evaluation of the borrower. Collateral held varies, but is generally accounts receivable, inventory, residential or income-producing commercial property or equipment. In the event of nonperformance, the Company or its subsidiaries may obtain and liquidate the collateral to recover amounts paid under its guarantees on these financial instruments. See Note 15 "Disclosures about Fair Value of Financial Instruments" for more information.

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balance sheet credit-related financial instruments. These financial instruments include commitments to extend credit, commercial letters of credit and standby letters of credit. The Company’s maximum potential exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit, commercial letters of credit and standby letters of credit is represented by the contractual amounts of those instruments. At December 31, 2024, an allowance for unfunded commitments of $273,000 had been recorded. See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Provision and Allowance for Credit Losses and Unfunded Commitments.”

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commercial and standby letters of credit are commitments issued by the Company or its subsidiaries to guarantee the performance of a customer to a third party. These off-balance sheet financial instruments generally have fixed expiration dates or other termination clauses and may require payment of a fee. At December 31, 2024, the balance of loan commitments, standby and commercial letters of credit were $247.4 million, $12.0 million and $400,000, respectively. Since some of the financial instruments may expire without being drawn upon, the total amounts do not necessarily represent future cash requirements. Commitments to extend credit and letters of credit are subject to the same underwriting standards as those financial instruments included on the consolidated balance sheets. The Company evaluates each customer’s credit worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary upon extension of the credit, is based on management’s credit evaluation of the borrower. Collateral held varies, but is generally accounts receivable, inventory, residential or income-producing commercial property or equipment. In the event of nonperformance, the Company or its subsidiaries may obtain and liquidate the collateral to recover amounts paid under its guarantees on these financial instruments. See Note 14 "Disclosures about Fair Value of Financial Instruments" for more information.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Sensitivity

The Company faces market risk to the extent that its net interest income is affected by changes in market interest rates. The asset/liability management discipline as applied by the Company seeks to limit the volatility, to the extent possible, that can result from changes in market interest rates. This is accomplished by limiting the concentration of maturities of fixed rate investments, loans, and deposits; matching fixed rate assets and liabilities to the extent possible; and optimizing the mix of fees and net interest income. However, the Company's asset/liability position often differs from other financial holding companies with positive cumulative "gaps." This asset sensitive position is caused primarily by the operations of the Company, which generate large balances of accounts and drafts payable. These balances, which are noninterest-bearing, can cause the Company to become susceptible to changes in interest rates, with a decreasing net interest margin in periods of declining interest rates and an increasing net interest margin in periods of rising interest rates, like the Company experienced in 2024 before the fourth quarter cumulative 100 basis point decline.

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investments, loans, and deposits; matching fixed rate assets and liabilities to the extent possible; and optimizing the mix of fees and net interest income. However, the Company's asset/liability position often differs from other financial holding companies with positive cumulative "gaps." This asset sensitive position is caused primarily by the operations of the Company, which generate large balances of accounts and drafts payable. These balances, which are noninterest-bearing, can cause the Company to become susceptible to changes in interest rates, with a decreasing net interest margin in periods of declining interest rates and an increasing net interest margin in periods of rising interest rates.

The Company’s ALCO measures the Company's interest rate risk sensitivity on a quarterly basis to monitor and manage the variability of earnings in various interest rate environments. The ALCO evaluates the Company's risk position to determine whether the level of exposure is significant enough to hedge a potential decline in earnings or whether the Company can safely increase risk to enhance returns. The ALCO uses gap reports, 12-month net interest income simulations, and fair market value of equity analyses as its main analytical tools to provide management with insight into the Company's exposure to changing interest rates.

Management uses a gap report to review any significant mismatch between the re-pricing points of the Company’s rate sensitive assets and liabilities in certain time horizons. A negative gap indicates that more liabilities re-price in that particular time frame and, if rates rise, these liabilities will re-price faster than the assets. A positive gap would indicate the opposite. Gap reports can be misleading in that they capture only the re-pricing timing within the balance sheet and fail to capture other significant risks such as basis risk and embedded options risk. Basis risk involves the potential for the spread relationship between rates to change under different rate environments and embedded options risk relates to the potential for the alteration of the level and/or timing of cash flows given changes in rates.

Another measurement tool used by management is net interest income simulation, which forecasts net interest income during the coming 12 months under different interest rate scenarios. Management has set policy limits specifying acceptable levels of interest rate risk given multiple simulated rate movements. These simulations are more informative than gap reports because they are able to capture more of the dynamics within the balance sheet, such as basis risk and embedded options risk. A table containing simulation results as of December 31, 2025, from an immediate and sustained parallel change in interest rates in three varying scenarios is shown below.

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embedded options risk. A table containing simulation results as of December 31, 2024, from an immediate and sustained parallel change in interest rates in three varying scenarios is shown below.

While net interest income simulations do an adequate job of capturing interest rate risk to short term earnings, they do not capture risk within the current balance sheet beyond 12 months. The Company uses fair market value of equity analyses to help identify longer-term risk that may reside on the current balance sheet. The fair market value of equity is represented by the present value of all future income streams generated by the current balance sheet. The Company measures the fair market value of equity as the net present value of all asset and liability cash flows discounted at forward rates suggested by the current U.S. Treasury curve plus appropriate credit spreads. This representation of the change in the fair market value of equity under different rate scenarios gives insight into the magnitude of risk to future earnings due to rate changes. Management has set policy limits relating to declines in the market value of equity.

The table below illustrates the projected impact of interest rate shocks on net interest income as of December 31, ~~2024~~2025:

Change in Interest Rates						% Change in Net Interest Income
+200 basis points						9.0%
+300 basis points						10.7%
+100 basis points						4.4
+200 basis points						7.6
+100 basis points						3.7
Flat rates						—
-100 basis points						0.(2.5)
-200 basis points						(16.31)%
-300 basis points						(10.6)%

The Company is generally asset sensitive as average interest-earning assets of $2.0115 billion for ~~2024~~2025 greatly exceeded average interest-bearing liabilities of $~~634~~617.63 million. The table above on the projected impact of interest rate shocks results from a static balance sheet at December 31, ~~2024~~2025.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

CASS INFORMATION SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	December 31,
(In thousands except share and per share data)	~~2024~~2025		~~2023~~2024
Assets
Cash and due from banks	$	1926,~~328~~129	$	2019,~~908~~328
Short-term investments	~~330~~366,~~400~~139		~~351~~330,~~560~~400
Cash and cash equivalents	~~349~~392,~~728~~268		~~372~~349,~~468~~728
Securities available-for-sale, at fair value	528,021		627,117
Investment securities available-for-sale, at fair value	770,772		528,021
Loans	1,~~081~~061,~~989~~217		1,~~014~~081,~~318~~989
Less allowance for credit losses	13,~~395~~597		13,~~089~~395
Loans, net	1,~~068~~047,~~594~~620		1,~~001~~068,~~229~~594
Payments in advance of funding	~~208~~164,~~530~~514		~~198~~208,~~861~~530
Premises and equipment, net	3429,~~174~~449		30,~~093~~576
Investments in bank-owned life insurance	5052,~~325~~195		4950,~~159~~325
Goodwill	2116,~~352~~164		1716,~~309~~333
Other intangible assets, net	53,~~007~~728		34,~~345~~914
Accounts and drafts receivable from customers	5569,~~906~~425		~~110~~55,~~651~~906
Other assets	7359,~~444~~889		6867,~~390~~741
Total assets	$	2,395,081	$	2,478,622
Assets of discontinued operations	—		14,413
Total assets	$	2,606,024	$	2,395,081
Liabilities and Shareholders’ Equity
Liabilities:
Deposits
Noninterest-bearing	$	~~251~~513,~~230~~434	$	~~524~~251,~~359~~230
Interest-bearing	~~716,~~686,599		~~616~~716,~~455~~686
Total deposits	~~967~~1,~~916~~200,033		1967,~~140,814~~916
Accounts and drafts payable	1,~~149~~124,~~276~~858		1,~~071~~129,~~369~~610
Other liabilities	4838,~~859~~135		3646,~~630~~211
Total liabilities	2,166,051		2,248,813
Liabilities of discontinued operations	—		22,314
Total liabilities	2,363,026		2,166,051
Shareholders’ Equity:
Preferred stock, par value $0.50 per share; 2,000,000 shares authorized and no shares issued	—		—
Common stock, par value $0.50 per share; 40,000,000 shares authorized; 15,505,772 shares issued at December 31, 2024 and 2023; 13,504,104 and 13,582,375 shares outstanding at December 31, 2024 and 2023, respectively.	7,753		7,753
Common stock, par value $0.50 per share; 40,000,000 shares authorized; 15,505,772 shares issued at December 31, 2025 and 2024; 12,917,637 and 13,504,104 shares outstanding at December 31, 2025 and 2024, respectively.	7,753		7,753
Additional paid-in capital	~~205~~207,~~593~~052		~~208~~205,~~007~~593
Retained earnings	~~148~~167,~~487~~092		~~145~~148,~~782~~487
Common shares in treasury, at cost (2,001,668 shares at December 31, 2024 and 1,923,397 shares at December 31, 2023, respectively)	(87,615)		(84,264)
Common shares in treasury, at cost (2,588,135 shares at December 31, 2025 and 2,001,668 shares at December 31, 2024, respectively)	(112,148)		(87,615)
Accumulated other comprehensive loss	(4526,~~188~~751)		(4745,~~469~~188)
Total shareholders’ equity	~~229~~242,~~030~~998		229,~~809~~030
Total liabilities and shareholders’ equity	$	2,~~395~~606,~~081~~024	$	2,~~478~~395,~~622~~081

See accompanying notes to consolidated financial statements.

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CASS INFORMATION SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

	For the Years Ended December 31,
(In thousands except per share data)	2024		2023		2022
Fee Revenue and Other Income:
Processing fees	$	82,671	$	79,566	$	76,470
Financial fees	43,297		45,985		43,757
Other	5,881		4,916		4,755
Total fee revenue and other income	131,849		130,467		124,982
Interest Income:
Interest and fees on loans	55,362		50,825		39,460
Interest and dividends on securities:
Taxable	13,423		14,118		10,083
Exempt from federal income taxes	3,508		4,097		6,354
Interest on federal funds sold and other short-term investments	15,752		13,720		6,429
Total interest income	88,045		82,760		62,326
Interest Expense:
Interest on deposits	20,257		16,150		3,482
Interest on short-term borrowings	1		116		—
Total interest expense	20,258		16,266		3,482
Net interest income	67,787		66,494		58,844
Provision for (release of) credit losses	447		(550)		1,350
Net interest income after provision for (release of) credit losses	67,340		67,044		57,494
Total net revenue	199,189		197,511		182,476
Operating Expense:
Salaries and commissions	96,356		93,474		85,489
Share-based compensation	3,167		4,139		6,732
Net periodic pension cost	4,172		878		(2,453)
Other benefits	19,696		20,203		16,706
Total personnel expenses	123,391		118,694		106,474
Occupancy	3,446		3,560		3,676
Equipment	8,305		7,138		6,668
Bad debt expense	7,847		—		—
Amortization of intangible assets	739		780		680
Other operating	31,242		29,983		22,078
Total operating expense	174,970		160,155		139,576
Income before income tax expense	24,219		37,356		42,900
Income tax expense	5,051		7,297		7,996
Net income	$	19,168	$	30,059	$	34,904
Basic earnings per share	$	1.42	$	2.22	$	2.58
Diluted earnings per share	1.39		2.18		2.53

See accompanying notes to consolidated financial statements.

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CASS INFORMATION SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME


	For the Years Ended December 31,
(In thousands except per share data)	2025		2024		2023
Fee Revenue and Other Income:
Processing fees	$	66,129	$	66,061	$	59,670
Financial fees	40,398		42,584		45,339
Loss on sale of investment securities	(3,534)		(45)		(173)
Other	6,865		5,247		5,089
Total fee revenue and other income	109,858		113,847		109,925

Interest Income:
Interest and fees on loans	62,340		55,362		50,825
Interest and dividends on investment securities:
Taxable	17,328		13,422		14,118
Exempt from federal income taxes	4,064		3,509		4,097
Interest on federal funds sold and other short-term investments	13,834		15,752		13,720
Total interest income	97,566		88,045		82,760

Interest Expense:
Interest on deposits	16,318		20,258		16,150
Interest on short-term borrowings	8		—		116
Total interest expense	16,326		20,258		16,266
Net interest income	81,240		67,787		66,494
Provision for (release of) credit losses	348		447		(550)
Net interest income after provision for (release of) credit losses	80,892		67,340		67,044
Total net revenue	190,750		181,187		176,969

Operating Expense:
Salaries and commissions	80,710		80,371		76,097
Share-based compensation	4,186		3,052		4,007
Employee profit sharing	6,284		4,452		5,815
Net periodic pension cost	—		4,169		878
Other benefits	18,886		17,293		17,591
Total personnel expenses	110,066		109,337		104,388
Occupancy	2,767		2,695		2,799
Equipment	9,917		8,101		6,895
Bad debt (recovery) expense	(2,000)		7,847		—
Amortization of intangible assets	1,172		692		692
Other operating expense	30,069		29,070		27,731
Total operating expense	151,991		157,742		142,505
Income from continuing operations, before income tax expense	38,759		23,445		34,464
Income tax expense	7,647		4,887		6,574
Net income from continuing operations	31,112		18,558		27,890
Income from discontinued operations, net of tax	4,004		610		2,169
Net income	$	35,116	$	19,168	$	30,059

Basic earnings per share from continuing operations	$	2.36	$	1.37	$	2.06
Basic earnings per share from discontinued operations	0.30		0.05		0.16
Basic earnings per share	$	2.66	$	1.42	$	2.22

Diluted earnings per share from continuing operations	$	2.31	$	1.35	$	2.02
Diluted earnings per share from discontinued operations	0.30		0.04		0.16
Diluted earnings per share	$	2.61	$	1.39	$	2.18

See accompanying notes to consolidated financial statements.

	For the Years Ended December 31,
(In thousands)	2024		2023		2022
Comprehensive Income:
Net income	$	19,168	$	30,059	$	34,904
Other comprehensive income (loss):
Net unrealized (loss) gain on securities available-for-sale	(1,931)		12,605		(79,746)
Tax effect	459		(3,000)		18,981
Reclassification adjustments for losses (gains) included in net income	45		173		(15)
Tax effect	(10)		(41)		3
FASB ASC 715 pension adjustment	5,191		2,550		1,504
Tax effect	(1,235)		(607)		(358)
Foreign currency translation adjustments, net of tax	(238)		172		(143)
Other comprehensive income (loss)	2,281		11,852		(59,774)
Total comprehensive income (loss)	$	21,449	$	41,911	$	(24,870)

See accompanying notes to consolidated financial statements.

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CASS INFORMATION SYSTEMS, INC. AND SUBSIDIARIES

	For the Years Ended December 31,
(In thousands)	2024		2023		2022
Cash Flows From Operating Activities:
Net income	$	19,168	$	30,059	$	34,904
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of intangible assets	739		780		680
Net amortization of premium/discount on investment securities	3,591		4,473		6,275
Depreciation	5,248		4,189		4,021
Losses (gains) on sales of securities	45		173		(15)
Share-based compensation expense	3,167		4,139		6,732
Provision for (release of) credit losses	447		(550)		1,350
Deferred income tax benefit	(1,046)		(284)		(1,163)
Increase (decrease) in current income tax liability	854		(1,481)		724
FASB ASC 715 pension adjustment, net of tax	5,191		2,550		1,504
Increase in accounts receivable	(3,336)		(3,841)		(2,520)
Other operating activities, net	4,881		(3,271)		(884)
Net cash provided by operating activities	38,949		36,936		51,608
Cash Flows From Investing Activities:
Proceeds from sales of securities available-for-sale	60,126		111,583		3,838
Proceeds from maturities of securities available-for-sale	153,192		39,233		61,209
Purchases of securities available-for-sale	(119,744)		(15,332)		(232,083)
Net (increase) decrease in loans	(67,671)		68,588		(122,326)
Purchase of bank-owned life insurance	—		—		(4,000)
(Increase) decrease in payments in advance of funding	(9,669)		94,914		(2,348)
Purchases of premises and equipment, net	(9,329)		(14,324)		(5,866)
Asset acquisition	(2,954)		—		(4,814)
Net cash provided by (used in) investing activities	3,951		284,662		(306,390)
Cash Flows From Financing Activities:
Net (decrease) increase in noninterest-bearing demand deposits	(273,129)		(118,398)		60,115
Net increase (decrease) in interest-bearing demand and savings deposits	95,489		(34,106)		(17,838)
Net increase (decrease) in time deposits	4,742		36,101		(6,563)
Net decrease (increase) in accounts and drafts receivable from customers	54,746		(14,872)		(90,787)
Net increase in accounts and drafts payable	77,907		3,769		17,204
Cash dividends paid	(16,463)		(15,959)		(15,442)
Purchase of common shares for treasury	(7,248)		(5,773)		(5,299)
Other financing activities, net	(1,684)		(834)		(594)
Net cash used in financing activities	(65,640)		(150,072)		(59,204)
Net (decrease) increase in cash and cash equivalents	(22,740)		171,526		(313,986)
Cash and cash equivalents at beginning of year	372,468		200,942		514,928
Cash and cash equivalents at end of year	$	349,728	$	372,468	$	200,942
Supplemental cash flow information:
Cash paid for interest	$	20,227	$	15,697	$	3,431
Cash paid for income taxes	5,509		9,300		8,396
Supplemental noncash disclosures:
Contingent consideration for asset acquisition	$	3,500	$	—	$	—

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME


	For the Years Ended December 31,
(In thousands)	2025		2024		2023
Comprehensive Income:
Net income	$	35,116	$	19,168	$	30,059
Other comprehensive income:
Net unrealized gain (loss) on securities available-for-sale	21,419		(1,931)		12,605
Tax effect	(5,099)		459		(3,000)
Reclassification adjustments for losses included in net income	3,534		45		173
Tax effect	(841)		(10)		(41)
ASC 715 pension adjustment	—		5,191		2,550
Tax effect	—		(1,235)		(607)
Foreign currency translation adjustments, net of tax	(576)		(238)		172
Other comprehensive income	18,437		2,281		11,852
Total comprehensive income	$	53,553	$	21,449	$	41,911

See accompanying notes to consolidated financial statements.

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CASS INFORMATION SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS


	For the Years Ended December 31,
(In thousands)	2025		2024		2023
Cash Flows From Operating Activities:
Net Income	$	35,116	$	19,168	$	30,059
Less: net income from discontinued operations	4,004		610		2,169
Net income from continuing operations	$	31,112	$	18,558	$	27,890
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of intangible assets	1,172		692		692
Net amortization of premium/discount on investment securities	974		3,591		4,472
Depreciation	6,029		5,033		3,954
Loss on sales of securities	3,534		45		173
Share-based compensation expense	4,186		3,052		4,007
Provision for (release of) credit losses	348		447		(550)
Increase in bank-owned life insurance	(1,870)		(1,165)		(1,161)
Increase (decrease) in current income tax liability	4,256		(192)		(1,766)
ASC 715 pension adjustment, net of tax	—		5,191		806
Increase in accounts receivable	(322)		(3,830)		(3,082)
Other operating activities, net	(10,611)		5,322		(49)
Net cash provided by operating activities - continuing operations	38,808		36,744		35,386
Net cash (used in) provided by operating activities - discontinued operations	(1,371)		2,205		1,551
Net cash provided by operating activities	37,437		38,949		36,937

Cash Flows From Investing Activities:
Proceeds from sales of securities available-for-sale	129,857		60,126		111,583
Proceeds from maturities of securities available-for-sale	83,075		153,192		39,233
Purchases of securities available-for-sale	(435,237)		(119,744)		(15,332)
Net decrease (increase) in loans	20,772		(67,671)		68,588
Proceeds from sale of TEM business	18,000		—		—
Decrease (increase) in payments in advance of funding	44,016		(9,669)		94,914
Purchases of premises and equipment, net	(5,663)		(8,512)		(11,938)
Asset acquisition	—		(2,954)		—
Net cash (used in) provided by investing activities - continuing operations	(145,180)		4,768		287,048
Net cash used in investing activities - discontinued operations	(99)		(817)		(2,386)
Net cash (used in) provided by investing activities	(145,279)		3,951		284,662

Cash Flows From Financing Activities:
Net increase (decrease) in noninterest-bearing demand deposits	262,204		(273,129)		(118,398)
Net (decrease) increase in interest-bearing demand and savings deposits	(46,025)		95,489		(34,106)
Net increase in time deposits	15,938		4,742		36,101
Net (increase) decrease in accounts and drafts receivable from customers	(13,519)		54,746		(14,872)
Net (decrease) increase in accounts and drafts payable	(4,753)		76,341		5,407

Cash dividends paid	(16,511)		(16,463)		(15,959)
Purchase of common shares for treasury	(25,988)		(7,248)		(5,773)
Other financing activities, net	(1,299)		(1,684)		(834)
Net cash provided by (used in) financing activities - continuing operations	170,047		(67,206)		(148,434)
Net cash (used in) provided by financing activities - discontinued operations	(19,665)		1,566		(1,639)
Net cash provided by (used in) financing activities	150,382		(65,640)		(150,073)
Net increase (decrease) in cash and cash equivalents	42,540		(22,740)		171,526
Cash and cash equivalents at beginning of year	349,728		372,468		200,942
Cash and cash equivalents at end of year	$	392,268	$	349,728	$	372,468

Supplemental cash flow information:
Cash paid for interest	$	16,386	$	20,227	$	15,697
Cash paid for income taxes	5,136		5,509		9,300
Supplemental noncash disclosures:
Contingent consideration for asset acquisition	$	—	$	3,500	$	—

See accompanying notes to consolidated financial statements.

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CASS INFORMATION SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(In thousands except per share data)	CommonStock		AdditionalPaid-inCapital		RetainedEarnings		TreasuryStock		~~AccumulatedOtherComprehensiveIncome (Loss)~~AccumulatedOtherComprehensiveLoss		Total
Balance, December 31, 2021	$	7,753	$	204,276	$	112,220	$	(78,904)	$	453	$	245,798
Net income					34,904						34,904
Cash dividends ($1.13 per share)					(15,442)						(15,442)
Issuance of 82,172 common shares pursuant to share-based compensation plan, net			(2,727)				2,414				(313)
Exercise of SARs			(859)				578				(281)
Share-based compensation expense			6,732				—				6,732
Purchase of 130,374 common shares							(5,299)				(5,299)
Other comprehensive loss									(59,774)		(59,774)
Balance, December 31, 2022	$	7,753	$	207,422	$	131,682	$	(81,211)	$	(59,321)	$	206,325
Net income					30,059						30,059
Cash dividends ($1.17 per share)					(15,959)						(15,959)
Issuance of 84,366 common shares pursuant to share-based compensation plan, net			(3,334)				2,616				(718)
Exercise of SARs			(238)				122				(116)
Share-based compensation expense			4,157				(18)				4,139
Purchase of 150,541 common shares							(5,773)				(5,773)
Other comprehensive income									11,852		11,852
Balance, December 31, 2023	$	7,753	$	208,007	$	145,782	$	(84,264)	$	(47,469)	$	229,809
Net income					19,168						19,168
Cash dividends ($1.21 per share)					(16,463)						(16,463)
Issuance of 126,336 common shares pursuant to share-based compensation plan, net			(5,613)				3,929				(1,684)
Share-based compensation expense			3,199				(32)				3,167
Purchase of 167,455 common shares							(7,248)				(7,248)
Other comprehensive income									2,281		2,281
Balance, December 31, 2024	$	7,753	$	205,593	$	148,487	$	(87,615)	$	(45,188)	$	229,030
Net income					35,116						35,116
Cash dividends ($1.25 per share)					(16,511)						(16,511)
Issuance of 122,127 common shares pursuant to share-based compensation plan, net			(2,862)				1,563				(1,299)
Share-based compensation expense			4,321				(108)				4,213
Purchase of 617,415 common shares							(25,988)				(25,988)
Other comprehensive income									18,437		18,437
Balance, December 31, 2025	$	7,753	$	207,052	$	167,092	$	(112,148)	$	(26,751)	$	242,998

See accompanying notes to consolidated financial statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1

Summary of Significant Accounting Policies

Summary of Operations The Company provides payment and information services, which include processing and payment of transportation, energy, telecommunications and environmental invoices. These services include the acquisition and management of data, information delivery and financial exchange. The consolidated balance sheet captions, “Accounts and drafts payable” and “Payments in advance of funding,” represent the Company’s resulting financial position related to the payment services that are performed for customers. The Company also provides a full range of banking services to individual, corporate and institutional customers through the Bank, its wholly owned bank subsidiary.

Basis of Presentation The accounting and reporting policies of the Company and its subsidiaries conform to U.S. GAAP. The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries after elimination of intercompany transactions. Certain amounts in the ~~2023~~2024 and ~~2022~~2023 consolidated financial statements have been reclassified to conform to the ~~2024~~2025 presentation. Such reclassifications have no effect on previously reported net income or shareholders’ equity.

~~Use~~Financial results have been presented on a continuing operations basis for all periods shown, unless otherwise indicated. As such, amounts related to components of ~~Estimates~~the Inbusiness ~~preparing~~that meet the ~~consolidated~~criteria ~~financial~~for ~~statements,~~classification as discontinued operations have been excluded from continuing operations and reported separately. Additional information regarding the Company’s ~~management~~discontinued isoperations ~~required~~for tothe ~~make~~years ~~estimates~~ended 2025 and ~~assumptions~~2024, ~~which~~including ~~significantly~~the ~~affect~~nature of the ~~reported~~divestitures ~~amounts~~and their impact on the consolidated financial statements, is provided in Note 2 to the consolidated financial statements.

Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the useful lives of fixed assets; allowance for credit losses; the valuation of deferred tax assets, fixed assets, investments, lease liabilities and right-of-use assets, and share-based compensation; and reserves for employee benefit obligations, income tax uncertainties, and other contingencies.

Cash and Cash Equivalents For purposes of the consolidated statements of cash flows, the Company considers cash and due from banks, interest-bearing deposits in other financial institutions, and federal funds sold and other short-term investments to be cash and cash equivalents.

Investment ~~in Debt~~ Securities The Company classifies its investment securities as available-for-sale. Securities classified as available-for-sale are carried at fair value. Unrealized gains and losses, net of the related tax effect, are excluded from earnings and reported in accumulated other comprehensive income, a component of shareholders’ equity. Securities are periodically evaluated for credit losses in accordance with the guidance provided in FASB ASC Topic 326, Financial Instruments – Credit Losses ("ASC 326").

For available for sale investment securities in an unrealized loss position, the entire loss in fair value is required to be recognized in current earnings if the Company intends to sell the securities or believes it is more likely than not that it will be required to sell the security before the anticipated recovery. If neither condition is met, and the Company does not expect to recover the amortized cost basis, the Company determines whether the decline in fair value resulted from credit losses or other factors. If the assessment indicates that a credit loss exists, the present value of cash flows expected to be collected is compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss has occurred, and an allowance for credit losses is recorded. The allowance for credit losses is limited by the amount that the fair value is less than the amortized cost basis. Any impairment not recorded through the provision for credit losses would be recognized in other comprehensive income.

Changes in the allowance for credit losses would be recorded as a provision for credit losses on the consolidated statements of income. Losses would be charged against the allowance for credit losses on securities when management believes the uncollectibility of an available-for-sale security is confirmed or when either of the conditions regarding intent or requirement to sell is met.

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Premiums and discounts are amortized or accreted to interest income over the expected lives of the respective securities using the level-yield method. Interest income is recognized when earned. Gains and losses are calculated using the specific identification method.

Loans Interest on loans is recognized based upon the principal amounts outstanding. It is the Company’s policy to discontinue the accrual of interest when there is reasonable doubt as to the collectability of principal or interest. Subsequent payments received on such loans are applied to principal if there is any doubt as to the collectability of such principal; otherwise, these receipts are recorded as interest income. The accrual of interest on a loan is resumed when the loan is current as to payment of both principal and interest and/or the borrower demonstrates the ability to pay and remain current. Loan origination and commitment fees on originated loans, net of certain direct loan origination costs, are deferred and amortized to interest income using the level-yield method over the estimated lives of the related loans.

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Allowance for Credit Losses The ACL is increased by provisions charged to expense and is available to absorb charge-offs, net of recoveries. Management utilizes a systematic, documented approach in determining the appropriate level of the ACL. Management’s approach provides for estimated current expected credit losses on loans in accordance with ASC 326. These estimates are based upon a number of factors, such as payment history, financial condition of the borrower, expected future cash flows and collateral exposure.

The ACL is a valuation account that is deducted from the amortized cost basis to present the net amount expected to be collected on the loans. Loans are charged off against the ACL when management believes the uncollectibility of a loan balance is confirmed. Expected recoveries for amounts previously charged off and expected to be charged off do not exceed the aggregate of amounts previously charged off and expected to be charged off.

Management estimated the allowance balance using relevant available information from internal and external sources, relating to past events, current conditions and reasonable and supportable forecasts based on economic factors, such as GDP. Historical credit loss experience, of both the Company and similar peer banks, provides the basis for the estimation of expected credit losses. Adjustments to historical loss information are made for concentration risk, asset quality trends, borrower’s ability to pay, collateral, and other environmental factors. It is difficult to estimate how potential changes in any one economic factor or input might affect the overall ACL because a wide variety of factors and inputs are considered in estimating the allowance and changes in those factors and inputs considered may not occur at the same rate and may not be consistent across all loan types. Additionally, changes in factors and inputs may be directionally inconsistent, such that improvement in one factor may offset deterioration in others. The ACL is measured on a collective pool basis when similar risk characteristics exist. Management believes the ACL is adequate to absorb expected losses in the loan portfolio.

Loans

The Company has identified the following portfolio segments:

Commercial & Industrial (“C&I”) – C&I loans consist of loans to small and medium-sized businesses in a wide variety of industries, franchise lending, and equipment financing to companies of all sizes. These loans are generally collateralized by inventory, accounts receivable, equipment, and other commercial assets, and may be supported by other credit enhancements such as personal guarantees. Risk arises primarily due to a difference between expected and actual cash flows of the borrower. However, the recoverability of these loans is also dependent on other factors primarily dictated by the type of collateral securing these loans. The fair value of the collateral securing these loans may fluctuate as market conditions change. Included within C&I are revolving loans supported by borrowing bases that fluctuate depending on the amount of underlying collateral.

Commercial Real Estate (“CRE”) – CRE loans include various types of loans for which the Company holds real property as collateral. Commercial real estate lending activity is typically restricted to owner-occupied properties or to investor properties that are owned by customers with a current banking relationship. The primary risks of CRE loans include the borrower’s inability to pay and material decreases in the value of the real estate being held as collateral.

Faith-based CRE – Faith-based CRE loans include loans to faith-based ministries for which the Company holds real property as collateral. The primary risks of faith-based CRE loans include the borrower’s inability to pay and material decreases in the value of the real estate being held as collateral.

Construction and Land Development – The Company originates loans to finance construction projects including faith-based and commercial projects. Construction loans are generally collateralized by first liens on the real estate and have floating interest rates. The primary risks of construction loans are construction completion and timing risk. Adverse economic conditions may negatively impact the borrowers’ ability to complete the project. Additionally, the fair value of the underlying collateral may fluctuate as market conditions change.

The ACL is calculated as the difference between the amortized cost basis of the loan portfolio and the projections from the weighted-average remaining maturity ("WARM") model that the Company developed. The WARM model utilizes an attrition analysis, including events such as payoffs, matured loans, and renewals in the borrowers’ control, to anticipate the length of time it would take for each portfolio segment to runoff. Management incorporates a one-year GDP forecast and an immediate reversion to peer historical loss rates to determine the annual charge off rates over the estimated life of the loans. After the reasonable and supportable forecast period, the model reverts to long-run /historical average loss rates of its peers. However, for the faith-based CRE ACL, loss rates are determined using the Company’s long-run historical averages, as this loan segment is unique to the Company and does not represent a more than nominal percentage of peer loan portfolios. The economic forecast is based on management’s assessment of the length and pattern of the current economic 48

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Additionally, the ACL calculation includes subjective adjustments for qualitative risk factors that are likely to cause estimated credit losses to differ from historical experience. These qualitative adjustments may increase or reduce reserve levels and include adjustments for lending management experience and risk tolerance, value of underlying collateral, loan review and audit results, asset quality and portfolio trends, loan portfolio growth and loan concentrations. The Company has elected to exclude accrued interest receivable ("AIR") from the allowance for credit losses calculation. When a loan is placed on non-accrual, any recorded AIR is reversed against interest income.

The ACL is decreased by net charge-offs and is increased by provisions for credit losses that are charged to the consolidated statements of operations. Charge-offs, if any, are typically measured for each loan based on a thorough analysis of the most probable source of repayment, such as the present value of the loan’s expected future cash flows, the loan’s estimated fair value, or the estimated fair value of the underlying collateral less costs of disposition for collateral-dependent loans. When it is determined that specific loans, or portions thereof, are uncollectible, these amounts are charged off against the ACL.

Unfunded loan commitments

In addition to the ACL for funded loans, the Company maintains reserves to cover the risk of loss associated with off-balance sheet unfunded loan commitments. The allowance for off-balance sheet credit losses is maintained within other liabilities in the statements of financial condition. Under the CECL framework, adjustments to this liability are recorded as provision for credit losses in the consolidated statements of operations. Unfunded loan commitment balances are evaluated by loan segment. In order to establish the required level of reserve, the Company applies average historical utilization rates and ACL loan model loss rates for each loan segment to the outstanding unfunded commitment balances.

Investment securities

Management evaluates all investments in an unrealized loss position on a quarterly basis, and more frequently when economic or market conditions warrant such evaluation. If the Company has the intent to sell the security or it is more likely than not that the Company will be required to sell the security, the security is written down to fair value and the entire loss is recorded in earnings. If either of the above criteria is not met, the Company will evaluate whether the decline in fair value is the result of credit losses or other factors. In making the assessment, the Company may consider various factors including the extent to which fair value is less than amortized cost, performance on any underlying collateral, downgrades in the ratings of the security by a rating agency, the failure of the issuer to make scheduled interest or principal payments and adverse conditions specifically related to the security. If the assessment indicates that a credit loss exists, the present value of cash flows expected to be collected is compared to the amortized cost basis of the security and any excess is recorded as an allowance for credit loss. For U.S. agency-backed securities where the risk of nonpayment of the amortized cost basis is zero, the Company will not measure expected credit losses on these securities. When the loss is not considered a result of credit loss, the cost basis of the security is written down to fair value, with the loss charge recognized in AOCI. Credit losses are not estimated for AIR from investment securities as interest deemed uncollectible is written off through interest income.

Individually Evaluated Loans A loan is considered individually evaluated when it is probable that a creditor will be unable to collect all amounts due, both principal and interest, according to the contractual terms of the loan agreement. Individually evaluated loans are generally measured based on the expected future cash flows and discounted at the loan's effective interest rate. Alternatively, reference to an observable market price could be used to individually evaluate loans, if one exists, or the fair value of the collateral for a collateral-dependent loan. Regardless of the historical measurement method used, the Company measures individually evaluated loans based on the fair value of the collateral when the Company determines foreclosure is probable. The Company uses its methods as discussed above for recognizing interest on individually evaluated loans. 49

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Foreclosed Assets Real estate acquired as a result of foreclosure is initially recorded at fair value less estimated selling costs. Fair value is generally determined through the receipt of appraisals. Any write down to fair value at the time the property is acquired is recorded as a charge-off to the allowance for credit losses. Any decline in the fair value of the property subsequent to acquisition is recorded as a charge to non-interest expense.

Premises and Equipment Premises and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed over the estimated useful lives of the assets, or the respective lease terms for leasehold improvements, using straight-line and accelerated methods. Estimated useful lives do not exceed 40 years for buildings, the lesser of 10 years or the life of the lease for leasehold improvements and range from 3 to 7 years for software, equipment, furniture and fixtures. Maintenance and repairs are charged to expense as incurred.

Goodwill and Intangible Assets ~~Cost~~Goodwill inand intangible assets have resulted from the excess ofpurchase price over the estimated fair value of net assets acquired ~~has~~in ~~resulted~~a ~~from~~ business ~~acquisitions~~combination. Goodwill and intangible assets with indefinite useful lives are not amortized, but instead are tested for impairment at least annually. Intangible assets with ~~definite~~finite useful lives are amortized on a straight-line basis over their respective estimated useful lives.

Periodically, the Company reviews finite intangible assets for events or changes in circumstances that may indicate that the carrying amount of the assets may not be recoverable. Based on those reviews, adjustments of recorded amounts have not been required.

Non-marketable Equity Investments The Company accounts for non-marketable equity investments, in which it holds less than a 20% ownership, as equity investments without readily determinable fair values. As a result, the carrying value of the investment is determined under the measurement alternative of cost, less impairment (if any), adjusted for fair value changes when observable prices are available. The Company periodically evaluates for impairment of these investments. In performing this evaluation, the Company considers various factors including the investee's financial condition, results of operations, operating trends and other financial ratios. Non-marketable equity investments are included in other assets on the consolidated balance sheets.

Treasury Stock Purchases of the Company’s common stock are recorded at cost. Upon reissuance, treasury stock is reduced based upon the average cost basis of shares held.

Comprehensive Income Comprehensive income consists of net income, changes in net unrealized gains (losses) on available-for-sale investment securities and pension liability adjustments and is presented in the accompanying consolidated statements of shareholders' equity and consolidated statements of comprehensive income.

Processing Fees A majority of the Company’s fee revenue is attributable to providing services related to processing and payment of invoices. These services include invoice processing, transportation invoice rating, payment processing and services, auditing, and the generation of accounting and transportation information. The Company also processes, pays and generates management information from electric, gas, telecommunications, environmental, and other invoices. The specific payment and information processing services provided to each customer are developed individually to meet each customer’s specific requirements. The Company enters into service agreements with customers typically for fixed fees per transaction that are invoiced monthly. Revenues are recognized in the period services are rendered and earned under the service agreements, as long as collection is reasonably assured.

Financial fees The Company earns fees on a transaction level basis for invoice payment services when making customer payments. Fees are recognized at the point in time when the payment transactions are made, which is when the performance obligation is satisfied.

Income Taxes Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Deferred tax assets are reduced if necessary, by a deferred tax asset valuation allowance. In the event that management determines it is more likely than not that it will not be able to realize all or part of net deferred tax assets in the future, the Company adjusts the recorded value of deferred tax assets, which would result in a direct charge to income tax expense in the period that such determination is made. Likewise, the Company will reverse the valuation allowance when realization of the deferred tax asset is expected. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company and its subsidiaries file U.S. federal and certain state income tax returns on a consolidated basis. In addition, certain state jurisdictions are filed on a separate company basis by the Company or its subsidiaries. 50

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The Company recognizes and measures income tax benefits using a two-step model: 1) a tax position must be more likely than not to be sustained based solely on its technical merits in order to be recognized; and 2) the benefit must be measured as the largest dollar amount of that position that is more likely than not to be sustained upon settlement. The difference between the benefit recognized for a tax position in this model and the tax benefit claimed on a tax return is treated as an unrecognized tax benefit. The Company recognizes income tax related interest and penalties in income tax expense.

Earnings Per Share Basic earnings per share is computed by dividing net income by the weighted average number of common shares outstanding. Diluted earnings per share is computed by dividing net income by the sum of the weighted average number of common shares outstanding and the weighted average number of potential common shares outstanding.

Share-Based Compensation The Company follows ~~FASB~~ ASC 718, Accounting for Stock Options and Other Share-based Compensation (“ASC 718”), which requires that all share-based compensation be recognized as an expense in the financial statements and that such cost be measured at the fair value of the award. ASC 718 also requires that excess tax benefits related to stock option exercises and restricted stock awards be reflected as financing cash inflows instead of operating cash inflows.

Pension Plans The amounts recognized in the consolidated financial statements related to the pension plans are determined from actuarial valuations. Inherent in these valuations are assumptions including expected return on plan assets, discount rates at which the liabilities could be settled and mortality rates. These assumptions are updated annually and are disclosed in Note 1011. The Company follows ~~FASB~~ ASC 715, Compensation – Retirement Benefits (“ASC 715”), which requires companies to recognize the overfunded or underfunded status of a defined benefit postretirement plan as an asset or liability in its consolidated balance sheet and to recognize changes in that funded status in the year in which the changes occur through comprehensive income. The funded status is measured as the difference between the fair value of the plan assets and the projected benefit obligation as of the date of its fiscal year-end. As further described in Note 11 to the consolidated financial statements, the Company terminated its noncontributory defined-benefit pension plan during 2024.

Fair Value Measurements The Company follows the provisions of ~~FASB~~ ASC 820, Fair Value Measurements and Disclosures, which defines fair value, establishes a framework for measuring fair value in GAAP, and outlines disclosures about fair value measurements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A three-level hierarchy for valuation techniques is used to measure financial assets and financial liabilities at fair value. This hierarchy is based on whether the valuation inputs are observable or unobservable. Financial instrument valuations are considered Level 1 when they are based on quoted prices in active markets for identical assets or liabilities. Level 2 financial instrument valuations use quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. Financial instrument valuations are considered Level 3 when they are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable, and when determination of the fair value requires significant management judgment or estimation. The Company records investment securities available for sale at their fair values on a recurring basis using Level 2 valuations. Additionally, the Company records individually evaluated credits and other real estate owned at their fair value on a nonrecurring basis. The nonrecurring fair value adjustments typically involve application of lower-of-cost-or-market accounting or impairment write-downs of individual assets.

~~Impact of New and Not Yet Adopted Accounting Pronouncements~~51

In October 2023, the FASB issued 2023-06, Disclosure Improvements - Codification Amendments in Response to the SEC's Disclosure Update and Simplification Initiative ("ASU 2023-06"). This ASU amends the ASC to incorporate certain disclosure requirements from SEC Release No. 33-10532 - Disclosure Update and Simplification that was issued in 2018. The effective date for each amendment will be the date on which the SEC's removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. ASU 2023-06 is not expected to have a significant impact on the Company's financial statements.

In November 2023, the FASB issued 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ("ASU 2023-07"). This ASU expands segment disclosure requirements for public entities to require disclosure of significant segment expenses and other segment items on an annual and interim basis and to provide in interim periods all disclosures about a reportable segment's profit or loss and assets that are currently required annually. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The adoption of ASU 2023-07 did not have a significant impact on the Company's financial statements. See Note 17 to our financial statements.

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InImpact December 2023, the FASB issued 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"). This ASU requires public business entities to disclose in their rate reconciliation table additional categories of ~~information~~New ~~about federal, state,~~ and ~~foreign~~Not ~~income~~Yet ~~taxes~~Adopted ~~and~~Accounting to provide more details about the reconciling items in some categories if items meet a quantitative threshold. It also requires all entities to disclose income taxes paid, net of refunds, disaggregated by federal, state, and foreign taxes for annual periods and to disaggregate the information by jurisdiction based on a quantitative threshold, among other things. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, though early adoption is permitted. ASU 2023-09 is not expected to have a significant impact on the Company's financial statements.Pronouncements

In December 2023, the FASB issued 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"). This ASU requires public business entities to disclose in their rate reconciliation table additional categories of information about federal, state, and foreign income taxes and to provide more details about the reconciling items in some categories if items meet a quantitative threshold. It also requires all entities to disclose income taxes paid, net of refunds, disaggregated by federal, state, and foreign taxes for annual periods and to disaggregate the information by jurisdiction based on a quantitative threshold, among other things. The adoption of ASU 2023-09 was effective for annual periods beginning after December 15, 2024 and can be seen in Note 14 to the consolidated financial statements.

In July 2025, the FASB issued Accounting Standards Update 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets ("ASU 2025-05"). ASU 2025-05 provides the option to elect a practical expedient to assume that the current conditions as of the balance sheet date will remain unchanged for the remaining life of the asset when developing a reasonable and supportable forecast as part of estimating expected credit losses on these assets. ASU 2025-05 is effective for the Company for the fiscal years beginning after December 15, 2025 and interim periods within those fiscal years. The Company does not expect adoption of ASU 2025-05 to have a material impact on its consolidated financial statements.

In September 2025, the FASB issued Accounting Standards Update 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40), Targeted Improvements to the Accounting for Internal-Use Software ("ASU 2025-06"). ASU 2025-06 clarified and modernized the accounting for costs related to internal-use software. The amendments in 2025-06 remove all references to project stages throughout Subtopic 350-40 and clarify the threshold entities apply to begin capitalizing costs. ASU 2025-06 is effective for the Company for fiscal years beginning after December 15, 2027 and interim periods within those fiscal years. The Company is currently evaluating the impact of adoption of ASU 2025-06 on its consolidated financial statements.

In December 2025, the FASB issued Accounting Standards Update 2025-11, Interim Reporting (Topic 270): Narrow‑Scope Improvements ("ASU 2025-11"). ASU 2025-11 clarifies and enhances guidance under ASC 270 on interim financial reporting by (i) clarifying the scope of ASC 270 such that it now explicitly applies only to entities that issue complete interim financial statements and related notes under U.S. GAAP, (ii) establishing clear guidance on the form of interim statements and notes, incorporating a comprehensive list of required interim disclosures drawn from across the ASC, and (iii) introducing a requirement to disclose material events and changes occurring after the end of the last annual period that could impact interim results. ASU 2025-11 will be effective for the Company for interim periods beginning in 2028, though early adoption is permitted. The Company does not expect the adoption of ASU 2025-11 to have a material impact on its consolidated financial statements.

Note 2

Discontinued Operations and Assets and Liabilities Held for Sale

The Company has applied discontinued operations accounting in accordance with ASC Topic 205-20, “Presentation of Financial Statements – Discontinued Operations,” to the assets and liabilities being sold related to the Company's TEM Business Unit as of and for the years ended December 31, 2025, 2024, and 2023, as applicable. The sale of the TEM Business Unit represents a strategic shift due to the Company completely exiting both the telecom expense management and managed mobility solutions businesses. The Company did not allocate any consolidated interest that is not directly attributable to or related to discontinued operations. All financial information in the consolidated financial statements and notes to the consolidated financial statements is reported on a continuing operations basis, unless otherwise noted. The TEM Business Unit is included in the Information Services operating segment.

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The carrying amount of major classes of assets and liabilities included as part of discontinued operations at December 31, 2025 and 2024 were as follows:


	December 31,
(In thousands except share and per share data)	2025		2024
Assets
Premises and equipment, net	$	—	$	3,598
Goodwill	—		5,019
Other intangible assets, net	—		93
Other assets	—		5,703
Assets of discontinued operations	$	—	$	14,413

Liabilities
Accounts and drafts payable	—		19,665
Other liabilities	—		2,649
Liabilities of discontinued operations	$	—	$	22,314

Net income from discontinued operations for the years ended December 31, 2025, 2024, and 2023 is as follows:


	For the Years Ended December 31,
(In thousands except per share data)	2025		2024		2023
Fee Revenue and Other Income:
Processing fees	$	7,630	$	15,795	$	17,837
Financial fees	888		713		646
Other	3,402		1,494		2,059
Gain on sale of TEM business	3,550		—		—
Total fee revenue and other income	15,470		18,002		20,542

Operating Expense:
Salaries and commissions	6,637		11,533		11,562
Share-based compensation	27		116		132
Other benefits	1,414		2,406		2,612
Total personnel expenses	8,078		14,055		14,306
Occupancy	408		751		761
Equipment	110		204		242
Amortization of intangible assets	18		45		88
Other operating	1,542		2,174		2,252
Total operating expense	10,156		17,229		17,649
Income from discontinued operations, before income tax expense	5,314		773		2,893
Income tax expense	1,310		163		724
Net income from discontinued operations	$	4,004	$	610	$	2,169

Note 3

Capital Requirements and Regulatory Restrictions

The Company and the Bank are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can result in certain mandatory, and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s consolidated financial statements. Under capital adequacy guidelines, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The Company’s and the Bank’s capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulators to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios of total and Tier I capital and common equity Tier I capital to risk-weighted assets, and of Tier I capital to average assets. Management believes that as of December 31, 2024 and 2023, the Company and the Bank met all capital adequacy requirements to which they are subject. 53

The Bank is also subject to the regulatory framework for prompt corrective action. As of December 31, 2024, the most recent notification from the regulatory agencies categorized the Bank as well-capitalized. To be categorized as well-capitalized, the Bank must maintain minimum total risk-based, common equity Tier I risk-based, Tier I risk-based, and Tier I leverage ratios as set forth in the table below. There are no conditions or events since that notification that management believes have changed the Bank’s category.

The Company has traditionally paid a quarterly cash dividend to its shareholders. Subsidiary dividends can be a significant source of funds for payment of dividends by the Company to its shareholders. Banking regulations may limit the amount of dividends that may be paid. Approval by regulatory authorities is required if the effect of dividends declared would cause the regulatory capital of the Bank to fall below specified minimum levels. Approval is also required if dividends declared exceed the net profits for that year combined with the retained net profits for the preceding two years. Under the foregoing dividend restrictions and while maintaining its “well capitalized” status, at December 31, 2024, unappropriated retained earnings of $31.4 million were available at the Bank for the declaration of dividends to the Company without prior approval from regulatory authorities. In addition to regulatory requirements and considerations, any payment of dividends in the future will depend on the Company’s earnings, financial condition and other factors considered relevant by the Company’s Board of Directors.

There were no restricted funds on deposit used to meet regulatory reserve requirements at December 31, 2024 and 2023.

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that involve quantitative measures of assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The Company’s and the Bank’s capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulators to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios of total and Tier I capital and common equity Tier I capital to risk-weighted assets, and of Tier I capital to average assets. Management believes that as of December 31, 2025 and 2024, the Company and the Bank met all capital adequacy requirements to which they are subject.

The Bank is also subject to the regulatory framework for prompt corrective action. As of December 31, 2025, the most recent notification from the regulatory agencies categorized the Bank as well-capitalized. To be categorized as well-capitalized, the Bank must maintain minimum total risk-based, common equity Tier I risk-based, Tier I risk-based, and Tier I leverage ratios as set forth in the table below. There are no conditions or events since that notification that management believes have changed the Bank’s category.

The Company has traditionally paid a quarterly cash dividend to its shareholders. Subsidiary dividends can be a significant source of funds for payment of dividends by the Company to its shareholders. Banking regulations may limit the amount of dividends that may be paid. Approval by regulatory authorities is required if the effect of dividends declared would cause the regulatory capital of the Bank to fall below specified minimum levels. Approval is also required if dividends declared exceed the net profits for that year combined with the retained net profits for the preceding two years. Under the foregoing dividend restrictions and while maintaining its “well capitalized” status, at December 31, 2025, unappropriated retained earnings of $31.1 million were available at the Bank for the declaration of dividends to the Company without prior approval from regulatory authorities. In addition to regulatory requirements and considerations, any payment of dividends in the future will depend on the Company’s earnings, financial condition and other factors considered relevant by the Company’s Board of Directors.

There were no restricted funds on deposit used to meet regulatory reserve requirements at December 31, 2025 and 2024.

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The Company’s and the Bank’s actual and required capital amounts and ratios are as follows:

	Actual				CapitalRequirements				Requirement to beWell-Capitalized
(In thousands)	Amount		Ratio		Amount		Ratio		Amount	Ratio
At December 31, 2025
Total capital (to risk-weighted assets)
Cass Information Systems, Inc.	$	262,792	15.95	%	$	131,837	8.00	%	$ N/A	N/A %
Cass Commercial Bank	217,409		19.61		88,677		8.00		110,847	10.00
Common Equity Tier I Capital (to risk-weighted assets)
Cass Information Systems, Inc.	248,776		15.10		74,158		4.50		N/A	N/A
Cass Commercial Bank	203,943		18.40		49,881		4.50		72,050	6.50
Tier I capital (to risk-weighted assets)
Cass Information Systems, Inc.	248,776		15.10		98,878		6.00		N/A	N/A
Cass Commercial Bank	203,943		18.40		66,508		6.00		88,677	8.00
Tier I capital (to average assets)
Cass Information Systems, Inc.	248,776		9.91		100,367		4.00		N/A	N/A
Cass Commercial Bank	203,943		14.48		56,357		4.00		70,446	5.00
At December 31, 2024
Total capital (to risk-weighted assets)
Cass Information Systems, Inc.	$	261,021	14.61	%	$	142,969	8.00	%	$ N/A	N/A %
Cass Commercial Bank	207,519		17.68		93,911		8.00		117,389	10.00
Common Equity Tier I Capital (to risk-weighted assets)
Cass Information Systems, Inc.	247,354		13.84		80,420		4.50		N/A	N/A
Cass Commercial Bank	194,446		16.56		52,825		4.50		76,303	6.50
Tier I capital (to risk-weighted assets)
Cass Information Systems, Inc.	247,354		13.84		107,226		6.00		N/A	N/A
Cass Commercial Bank	194,446		16.56		70,433		6.00		93,911	8.00
Tier I capital (to average assets)
Cass Information Systems, Inc.	247,354		10.57		93,625		4.00		N/A	N/A
Cass Commercial Bank	194,446		13.50		57,620		4.00		72,026	5.00
At December 31, 2023
Total capital (to risk-weighted assets)
Cass Information Systems, Inc.	$	269,580	15.49	%	$	139,266	8.00	%	$ N/A	N/A %
Cass Commercial Bank	204,584		19.04		85,964		8.00		107,455	10.00
Common Equity Tier I Capital (to risk-weighted assets)
Cass Information Systems, Inc.	256,359		14.73		78,337		4.50		N/A	N/A
Cass Commercial Bank	192,104		17.88		48,355		4.50		69,846	6.50
Tier I capital (to risk-weighted assets)
Cass Information Systems, Inc.	256,359		14.73		104,449		6.00		N/A	N/A
Cass Commercial Bank	192,104		17.88		64,473		6.00		85,964	8.00
Tier I capital (to average assets)
Cass Information Systems, Inc.	256,359		10.71		95,760		4.00		N/A	N/A
Cass Commercial Bank	192,104		12.49		61,526		4.00		76,908	5.00

~~Note 3~~55

Investment Securities

Investment securities available-for-sale are recorded at fair value on a recurring basis. The Company’s investment securities available-for-sale at December 31, 2024 and 2023 are measured at fair value using Level 2 valuations. The market evaluation utilizes several sources which include “observable inputs” rather than “significant unobservable inputs” and therefore falls into the Level 2 category. The table below presents the balances of securities available-for-sale

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~~measured~~Note ~~at fair value on a recurring basis. The amortized cost, gross unrealized gains, gross unrealized losses and fair value of debt and equity securities are summarized as follows:~~ 4

	December 31, 2024
(In thousands)	AmortizedCost		GrossUnrealizedGains		GrossUnrealizedLosses		Fair Value
State and political subdivisions	$	188,933	$	4	$	(16,973)	$	171,964
Mortgage-backed securities issued or guaranteed by U.S. government agencies or sponsored enterprises	267,359		11		(34,095)		233,275
Corporate bonds	95,841		3		(8,058)		87,786
Asset backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	35,575		—		(579)		34,996
Total	$	587,708	$	18	$	(59,705)	$	528,021

Investment Securities

	December 31, 2023
(In thousands)	AmortizedCost		GrossUnrealizedGains		GrossUnrealizedLosses		Fair Value
State and political subdivisions	$	235,297	$	4	$	(16,266)	$	219,035
Mortgage-backed securities issued or guaranteed by U.S. government agencies or sponsored enterprises	188,307		—		(30,508)		157,799
Corporate bonds	111,109		—		(8,769)		102,340
Treasury Securities	109,836		—		(1,115)		108,721
Asset backed securities issued or guaranteed by U.S. government agencies or sponsored enterprises	40,368		—		(1,146)		39,222
Total	$	684,917	$	4	$	(57,804)	$	627,117

Investment securities available-for-sale are recorded at fair value on a recurring basis. The Company’s investment securities available-for-sale at December 31, 2025 and 2024 are measured at fair value using Level 2 valuations. The market evaluation utilizes several sources which include “observable inputs” rather than “significant unobservable inputs” and therefore falls into the Level 2 category. The table below presents the balances of investment securities available-for-sale measured at fair value on a recurring basis. The amortized cost, gross unrealized gains, gross unrealized losses and fair value of debt and equity investment securities are summarized as follows:


	December 31, 2025
(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
State and political subdivisions	$	247,716	$	3,228	$	(10,733)	$	240,211
Mortgage-backed securities issued or guaranteed by U.S. government agencies or sponsored enterprises	503,599		2,144		(27,047)		478,696
Corporate bonds	30,895		—		(1,999)		28,896

Asset backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	23,294		—		(325)		22,969
Total	$	805,504	$	5,372	$	(40,104)	$	770,772


	December 31, 2024
(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
State and political subdivisions	$	188,933	$	4	$	(16,973)	$	171,964
Mortgage-backed securities issued or guaranteed by U.S. government agencies or sponsored enterprises	267,359		11		(34,095)		233,275
Corporate bonds	95,841		3		(8,058)		87,786

Asset backed securities issued or guaranteed by U.S. government agencies or sponsored enterprises	35,575		—		(579)		34,996
Total	$	587,708	$	18	$	(59,705)	$	528,021

The fair values of securities with unrealized losses are as follows:

December 31, 2024

December 31, 2025

Less than 12 months

12 months or more

Total

(In thousands)

EstimatedFair Value

UnrealizedLosses

EstimatedFair Value

UnrealizedLosses

EstimatedFair Value

UnrealizedLosses

State and political subdivisions

~~4,082~~—

8—

~~163~~139,~~893~~379

1610,~~964~~733

~~167~~139,~~975~~379

1610,~~972~~733

Mortgage-backed securities issued or guaranteed by U.S. government agencies or sponsored enterprises

85148,~~272~~111

21,~~086~~733

~~139~~155,~~676~~353

3225,~~009~~314

~~224~~303,~~948~~464

3427,~~095~~047

Corporate bonds

~~7,901~~—

99—

6628,~~860~~896

71,~~960~~999

7428,~~761~~896

81,~~059~~999

Asset backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises

—

3022,~~575~~969

~~579~~325

3022,~~575~~969

~~579~~325

Total

97148,~~255~~111

21,~~193~~733

~~401~~346,~~004~~597

5738,~~512~~371

~~498~~494,~~259~~708

5940,~~705~~104

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	December 31, 2023
	December 31, 2024
	Less than 12 months				12 months or more				Total
(In thousands)	EstimatedFair Value		UnrealizedLosses		EstimatedFair Value		UnrealizedLosses		EstimatedFair Value		UnrealizedLosses
State and political subdivisions	$	634,~~198~~082	$	~~220~~8	$	~~152~~163,~~854~~893	$	16,~~046~~964	$	~~216~~167,~~052~~975	$	16,~~266~~972
Mortgage-backed securities issued or guaranteed by U.S. government agencies or sponsored enterprises	—85,272		—2,086		~~157~~139,~~799~~676		3032,~~508~~009		~~157~~224,~~799~~948		3034,~~508~~095
Corporate bonds	197,~~545~~901		~~455~~99		8266,~~795~~860		87,~~314~~960		~~102~~74,~~340~~761		8,~~769~~059
Treasury securities	—		—		108,721		1,115		108,721		1,115
Asset backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	—		—		30,575		579		30,575		579
Asset backed securities issued or guaranteed by U.S. Government agencies or sponsored enterprises	—		—		39,222		1,146		39,222		1,146
Total	$	97,255	$	2,193	$	401,004	$	57,512	$	498,259	$	59,705
Total	$	82,743	$	675	$	541,391	$	57,129	$	624,134	$	57,804

There were ~~241~~204 investment securities, or 9667.03%, in an unrealized loss position as of December 31, ~~2024~~2025 compared to ~~275~~241 investment securities, or 9896.90%, in an unrealized loss position as of December 31, ~~2023~~2024. The unrealized losses at December 31, ~~2024~~2025 were primarily attributable to changes in market interest rates after the investment securities were purchased. The Company does not currently intend to sell, and based on current conditions, the Company does not believe it will be required to sell these available-for-sale investment securities before the recovery of the amortized cost basis, which may be the maturity dates of the investment securities. Therefore, the unrealized losses are recorded in accumulated other comprehensive loss. Of these investment securities, ~~215~~177, or 8558.74%, were in an unrealized loss position for greater than 12 months at December 31, ~~2024~~2025. At December 31, ~~2024~~2025 and December 31, ~~2023~~2024, the Company had not recorded an allowance for credit losses on investment securities.

The amortized cost and fair value of debt and equity investment securities by contractual maturity are shown in the following table. Expected maturities may differ from contractual maturities because borrowers have the right to prepay obligations with or without prepayment penalties.

	December 31, 2024
	December 31, 2025
(In thousands)	Amortized Cost		Fair Value
Due in 1 year or less	$	86,~~826~~757	$	86,~~820~~755
Due after 1 year through 5 years	~~104~~73,~~272~~493		~~102~~70,~~227~~979
Due after 5 years through 10 years	~~207~~160,~~253~~264		~~183~~149,~~452~~204
Due after 10 years	~~267~~564,~~357~~990		~~233~~543,~~522~~834
Total	$	~~587~~805,~~708~~504	$	~~528~~770,~~021~~772

There were no investment securities pledged to secure public deposits or for other purposes at December 31, ~~2024~~2025.

Proceeds from sales of investment securities classified as available-for-sale were $60129.19 million in ~~2024~~2025, $~~111~~60.61 million in ~~2023~~2024, and $3111.86 million in ~~2022~~2023. Gross realized gains on the sales in ~~2024~~2025, ~~2023~~2024, and ~~2022~~2023 were $4429,000, $~~187~~4,000, and $15187,000, respectively. Gross realized losses on the sales in ~~2024~~2025, ~~2023~~2024, and ~~2022~~2023 were $494.0 million,~~000,~~ $~~360~~49,000 and $0360,000, respectively.

Note 45

Loans

The Company originates commercial, industrial and real estate loans to businesses and faith-based ministries throughout the metropolitan St. Louis, Missouri area, Colorado Springs, Colorado and other selected cities in the United States. The Company does not have any particular concentration of credit in any one economic sector; however, a substantial portion of the commercial and industrial loans is extended to privately-held commercial companies and franchises in these market areas and are generally secured by the assets of the business. The Company also has a substantial portion of real estate

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loans secured by mortgages that are extended to faith-based ministries in its market area and selected cities in the United States.

A summary of loan categories is as follows:

	December 31,
(In thousands)	~~2024~~2025		~~2023~~2024
Commercial and industrial	$	~~559~~553,~~262~~080	$	~~498~~559,~~502~~262
Real estate:
Commercial:
Mortgage	~~119~~97,~~194~~567		~~118~~119,~~371~~194
Construction	912,~~134~~943		89,~~233~~134
Faith-based:
Mortgage	~~368~~362,~~881~~312		~~381,~~368,881
Construction	2535,~~518~~288		725,~~790~~518
Other	—27		54—
Total loans	$	1,~~081~~061,~~989~~217	$	1,~~014~~081,~~318~~989

The following table presents the aging of loans by loan categories at December 31, 2025:

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