Santander Holdings USA, Inc.

EX-99.1 · d151630dex991.htm

EX-99.1
 3
 d151630dex991.htm
 EX-99.1

 Exhibit 99.1

 Report of Independent Registered Public Accounting Firm

 To the Stockholders and the Board of Directors
 Webster
Financial Corporation:
 Opinion on the Consolidated Financial Statements

 We have audited the accompanying consolidated balance sheets of Webster Financial Corporation and subsidiaries (the Company) as of December 31, 2025 and
2024, the related consolidated statements of income, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes (collectively, the consolidated
financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows
for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.
 We also have
audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in
 Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 27, 2026 expressed an unqualified opinion on the effectiveness of the
Company’s internal control over financial reporting.
 Basis for Opinion

 These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
rules and regulations of the Securities and Exchange Commission and the PCAOB.
 We conducted our audits in accordance with the standards of the PCAOB. Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to
assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the
amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated
financial statements. We believe that our audits provide a reasonable basis for our opinion.
 Critical Audit Matter

 The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or
required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.
The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the
critical audit matter or on the accounts or disclosures to which it relates.
 Assessment of the allowance for credit losses for certain
commercial loans and leases evaluated on a collective basis
 As discussed in Notes 1 and 4 to the consolidated financial statements, the
Company’s total allowance for credit losses as of December 31, 2025 was $719.4 million, a portion of which related to the allowance for credit losses for certain commercial loans and leases evaluated on a collective basis (the
Commercial Allowance). The Commercial Allowance includes the measure of expected credit losses on a collective (pooled) basis for those loans and leases with similar risk characteristics. The Company’s collectively assessed loans and leases
are segmented based on product type and credit quality and expected losses are determined using a model that follows a probability of default (PD), loss given default (LGD), and exposure at default (EAD) framework. The expected credit losses are
calculated as the product of the Company’s estimate of PD, LGD, and individual loan level EAD. The Company’s PD and LGD calculations use a predictive model that measures the current risk profile of the loan pools using forecasts of
future macroeconomic conditions, historical loss information, loan-level risk attributes and credit quality indicators. The Company’s model incorporates baseline and downside macroeconomic forecast scenarios, and management weights the
scenarios based on reviews of variable forecasts and comparisons to expectations using readily available data to arrive at a macroeconomic scenario over a reasonable and supportable forecast period. The development of the reasonable and supportable
forecast assumes that each portfolio will revert to its long-term loss rate expectation. The reasonable and supportable forecast period is two years after which the reversion period is one year. The model uses output reversion and revert to mean
historical portfolio loss rates on a straight-line basis in the third year of the forecast. A portion of

 1

 the Commercial Allowance is comprised of qualitative adjustments for risk characteristics
that are not reflected or captured in the quantitative model but are likely to impact the measurement of expected credit losses.
 We
identified the assessment of the Commercial Allowance as a critical audit matter. A high degree of audit effort, including specialized skills and knowledge, and subjective and complex auditor judgment was involved in the assessment due to
significant measurement uncertainty. Specifically, the assessment encompassed the evaluation of the Commercial Allowance methodology, including the methods and model used to estimate (1) the PD, LGD, and EAD, and their significant assumptions,
including the baseline and downside macroeconomic forecast scenarios and macroeconomic variables and (2) qualitative adjustments and their significant assumptions not reflected in the PD and LGD model and EAD method. The assessment also
included an evaluation of the conceptual soundness and performance of the PD and LGD model and EAD method. In addition, auditor judgment was required to evaluate the sufficiency of audit evidence obtained.

 The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating
effectiveness of certain internal controls related to the Company’s measurement of the Commercial Allowance estimate, including controls over the:

 •

 evaluation of the Commercial Allowance methodology

 •

 continued use and appropriateness of changes made to certain PD and LGD model and EAD method

 •

 identification and determination of the significant assumptions used in the PD and LGD model and EAD method

 •

 procedures performed by the Company to validate the model is fit for use and appropriate to estimate the lifetime
loss

 •

 evaluation of qualitative adjustments, including the significant assumptions, and

 •

 analysis of the Collective Allowance results, trends, and ratios.

 We evaluated the Company’s process to develop the Commercial Allowance estimate by testing certain sources of data, factors, and
assumptions that the Company used, and considered the relevance and reliability of such data, factors, and assumptions. In addition, we involved credit risk professionals with specialized skills and knowledge, who assisted in:

 •

 evaluating the Company’s Commercial Allowance methodology for compliance with U.S. generally accepted
accounting principles

 •

 evaluating judgments made by the Company relative to the assessment and performance testing of PD and LGD model
and EAD method by comparing them to relevant Company-specific metrics and trends and the applicable industry practices

 •

 assessing the conceptual soundness and performance of the PD and LGD model by inspecting the model documentation
to determine whether the model is suitable for the intended use

 •

 evaluating the selection of the economic forecast scenarios and underlying macroeconomic variables by comparing
them to the Company’s business environment and relevant industry practices

 •

 evaluating the methodology and assumptions used to develop the qualitative factors and the effect of those factors
on the Commercial Allowance compared with credit trends and identified limitations of the underlying quantitative model.

 We also assessed the sufficiency of the audit evidence obtained related to the Commercial Allowance estimate by evaluating the cumulative
results of the audit procedures and potential bias in the accounting estimate.
 /s/ KPMG LLP (185)

 We have served as the Company’s auditor since 2013.
 New
York, New York
 February 27, 2026

 2

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 CONSOLIDATED BALANCE SHEETS

 December 31,

 (In thousands, except share and par value data)

 2025

 2024

 Assets:

 Cash and due from banks

  $
 370,748

  $
 388,060

 Interest-bearing deposits

 2,078,777

 1,686,374

 Investment securities
 available-for-sale, at fair value (1)

 10,009,500

 9,006,600

 Investment securities
 held-to-maturity, net of allowance for credit losses of $97 and $171 (2)

 7,969,575

 8,444,191

 Loans held for sale (3)

 14,886

 27,634

 Loans and leases

 56,597,110

 52,505,168

 Allowance for credit losses on loan and leases

 (719,411
 )

 (689,566
 )

 Loans and leases, net

 55,877,699

 51,815,602

 Federal Home Loan Bank and Federal Reserve Bank stock

 356,411

 321,343

 Deferred tax assets, net

 195,740

 316,856

 Premises and equipment, net

 432,035

 406,963

 Goodwill

 2,897,522

 2,868,068

 Other intangible assets, net

 313,234

 334,301

 Cash surrender value of life insurance policies

 1,271,457

 1,251,622

 Accrued interest receivable and other assets

 2,286,079

 2,157,459

 Total assets

  $
 84,073,663

  $
 79,025,073

 Liabilities and stockholders’ equity:

 Deposits:

 Non-interest-bearing

  $
 10,082,854

  $
 10,316,501

 Interest-bearing

 58,676,959

 54,436,579

 Total deposits

 68,759,813

 64,753,080

 Securities sold under agreements to repurchase and federal funds purchased

 596,738

 344,168

 Federal Home Loan Bank advances

 2,980,718

 2,110,108

 Long-term debt

 739,454

 909,185

 Accrued expenses and other liabilities

 1,504,704

 1,775,318

 Total liabilities

 74,581,427

 69,891,859

 Stockholders’ equity:

 Preferred stock, $0.01 par value: Authorized—3,000,000 shares;

 Series F issued and outstanding—6,000 shares

 145,037

 145,037

 Series G issued and outstanding—135,000 shares

 138,942

 138,942

 Common stock, $0.01 par value: Authorized—400,000,000 shares;

 Issued—182,778,045 shares; Outstanding—161,216,008 and 171,391,125 shares

 1,828

 1,828

 Paid-in capital

 6,183,434

 6,181,475

 Retained earnings

 4,477,744

 3,759,158

 Treasury stock, at cost—21,562,037 and 11,386,920 shares

 (1,103,905
 )

 (536,843
 )

 Accumulated other comprehensive (loss), net of tax

 (350,844
 )

 (556,383
 )

 Total stockholders’ equity

 9,492,236

 9,133,214

 Total liabilities and stockholders’ equity

  $
    84,073,663

  $
    79,025,073

 (1)
 Investment securities
 available-for-sale had an amortized cost basis of $10,466,978 at December 31, 2025, and $9,720,415 at December 31, 2024.

 (2)
 Investment securities
 held-to-maturity had a fair value of $7,168,583 at December 31, 2025, and $7,453,123 and at December 31, 2024.

 (3)
 Total loans held for sale includes residential mortgage loans valued under the fair value option of $2,142 at
December 31, 2025, and $297 at December 31, 2024.

 See accompanying Notes to Consolidated Financial Statements.

 3

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF INCOME

 Years ended December 31,

 (In thousands, except per share data)

 2025

 2024

 2023

 Interest income:

 Interest and fees on loans and leases

  $
    3,118,558
  

  $
    3,182,466

  $
    3,071,378

 Taxable interest on investment securities

 764,631

 636,177

 396,681

 Non-taxable interest on investment securities

 28,949

 38,758

 54,207

 Loans held for sale

 4,215

 13,911

 734

 Other interest and dividends

 105,155

 55,974

 105,260

 Total interest income

 4,021,508

 3,927,286

 3,628,260

 Interest expense:

 Deposits

 1,365,703

 1,427,204

 1,021,418

 Securities sold under agreements to repurchase and federal funds purchased

 3,298

 4,113

 9,102

 Federal Home Loan Bank advances

 111,183

 125,329

 222,537

 Long-term debt

 43,430

 32,253

 37,934

 Total interest expense

 1,523,614

 1,588,899

 1,290,991

 Net interest income

 2,497,894

 2,338,387

 2,337,269

 Provision for credit losses

 210,000

 222,000

 150,747

 Net interest income after provision for credit losses

 2,287,894

 2,116,387

 2,186,522

 Non-interest income:

 Deposit service fees

 157,891

 161,144

 169,318

 Loan and lease related fees

 70,692

 76,384

 84,861

 Wealth and investment services

 30,983

 33,234

 28,999

 Cash surrender value of life insurance policies

 33,219

 27,712

 26,228

 Gain (loss) on sale of investment securities, net

 220

 (136,224
 )

 (33,620
 )

 Other income

 108,514

 89,649

 38,551

 Total non-interest income

 401,519

 251,899

 314,337

 Non-interest expense:

 Compensation and benefits

 821,748

 762,794

 711,752

 Occupancy

 77,416

 72,161

 77,520

 Technology and equipment

 190,614

 195,017

 197,928

 Intangible assets amortization

 36,304

 36,082

 36,207

 Marketing

 20,978

 18,751

 18,622

 Professional and outside services

 75,202

 58,253

 107,497

 Deposit insurance

 51,006

 68,912

 98,081

 Other expense

 155,996

 139,309

 168,748

 Total non-interest expense

 1,429,264

 1,351,279

 1,416,355

 Income before income taxes

 1,260,149

 1,017,007

 1,084,504

 Income tax expense

 257,347

 248,300

 216,664

 Net income

 1,002,802

 768,707

 867,840

 Preferred stock dividends

 16,650

 16,650

 16,650

 Income allocated to participating securities

 11,291

 7,981

 7,922

 Net income applicable to common stockholders

  $
 974,861

  $
 744,076

  $
 843,268

 Earnings per common share:

 Basic

  $
 5.91

  $
 4.38

  $
 4.91

 Diluted

 5.90

 4.37

 4.91

 See accompanying Notes to Consolidated Financial Statements.

 4

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

 Years ended December 31,

 (In thousands)

 2025

 2024

 2023

 Net income

  $
    1,002,802

  $
    768,707

  $
    867,840 

 Other comprehensive income (loss), net of tax:

 Investment securities
 available-for-sale

 186,205

 (2,868
 )

 113,710 

 Derivative financial instruments

 13,341

 (6,731
 )

 6,005 

 Defined benefit pension and other postretirement benefit plans

 5,993

 3,787

 14,674 

 Other comprehensive income (loss), net of tax

 205,539

 (5,812
 )

 134,389 

 Comprehensive income

  $
 1,208,341

  $
 762,895

  $
 1,002,229 

 See accompanying Notes to Consolidated Financial Statements.

 5

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

 (In thousands, except per share data)

 Preferred
Stock

 Common
Stock

 Paid-In
Capital

 Retained
Earnings

 Treasury
Stock,
at cost

 Accumulated
Other
Comprehensive
(Loss), Net of Tax

 Total
Stockholders’
Equity

 Balance at December 31, 2022

  $
 283,979

 $
 1,828

 $
 6,173,240

 $
 2,713,861

 $
 (431,762
 )

 $
 (684,960
 )

 $
 8,056,186 

 Adoption of ASU No. 2022-02

 —

 —

 —

 (4,245
 )

 —

 —

 (4,245)

 Net income

 —

 —

 —

 867,840

 —

 —

 867,840 

 Other comprehensive income, net of tax

 —

 —

 —

 —

 —

 134,389

 134,389 

 Common stock dividends and equivalents—$1.60 per share

 —

 —

 —

 (278,276
 )

 —

 —

 (278,276)

 Series F preferred stock dividends—$1,312.50 per share

 —

 —

 —

 (7,875
 )

 —

 —

 (7,875)

 Series G preferred stock dividends—$65.00 per share

 —

 —

 —

 (8,775
 )

 —

 —

 (8,775)

 Stock-based compensation

 —

 —

 8,539

 —

 45,548

 —

 54,087 

 Exercise of stock options

 —

 —

 (2,026
 )

 —

 3,749

 —

 1,723 

 Common shares acquired from stock compensation plan activity

 —

 —

 —

 —

 (16,278
 )

 —

 (16,278)

 Common stock repurchase program (1)

 —

 —

 —

 —

 (108,780
 )

 —

 (108,780)

 Balance at December 31, 2023

 283,979

 1,828

 6,179,753

 3,282,530

 (507,523
 )

 (550,571
 )

 8,689,996 

 Net income

 —

 —

 —

 768,707

 —

 —

 768,707 

 Other comprehensive (loss), net of tax

 —

 —

 —

 —

 —

 (5,812
 )

 (5,812)

 Common stock dividends and equivalents—$1.60 per share

 —

 —

 —

 (275,429
 )

 —

 —

 (275,429)

 Series F preferred stock dividends—$1,312.50 per share

 —

 —

 —

 (7,875
 )

 —

 —

 (7,875)

 Series G preferred stock dividends—$65.00 per share

 —

 —

 —

 (8,775
 )

 —

 —

 (8,775)

 Stock-based compensation

 —

 —

 1,886

 —

 53,255

 —

 55,141 

 Exercise of stock options

 —

 —

 (164
 )

 —

 418

 —

 254 

 Common shares acquired from stock compensation plan activity

 —

 —

 —

 —

 (17,215
 )

 —

 (17,215)

 Common stock repurchase program (1)

 —

 —

 —

 —

 (65,778
 )

 —

 (65,778)

 Balance at December 31, 2024

 283,979

 1,828

 6,181,475

 3,759,158

 (536,843
 )

 (556,383
 )

 9,133,214 

 Net income

 —

 —

 —

 1,002,802

 —

 —

 1,002,802 

 Other comprehensive income, net of tax

 —

 —

 —

 —

 —

 205,539

 205,539 

 Common stock dividends and equivalents—$1.60 per share

 —

 —

 —

 (267,566
 )

 —

 —

 (267,566)

 Series F preferred stock dividends—$1,312.50 per share

 —

 —

 —

 (7,875
 )

 —

 —

 (7,875)

 Series G preferred stock dividends—$65.00 per share

 —

 —

 —

 (8,775
 )

 —

 —

 (8,775)

 Stock-based compensation

 —

 —

 1,997

 —

 54,826

 —

 56,823 

 Exercise of stock options

 —

 —

 (38
 )

 —

 105

 —

 67 

 Common shares acquired from stock compensation plan activity

 —

 —

 —

 —

 (22,762
 )

 —

 (22,762)

 Common stock repurchase program (1)

 —

 —

 —

 —

 (599,231
 )

 —

 (599,231)

 Balance at December 31, 2025

  $
   283,979

 $
  1,828

 $
  6,183,434

 $
  4,477,744

 $
  (1,103,905
 )

 $
     (350,844
 )

 $
   9,492,236 

 (1)
 Includes an addition to Treasury Stock of $5.6 million, $0.4 million, and $0.8 million at
December 31, 2025, 2024, and 2023, respectively, for the 1% excise tax on net stock repurchases as imposed by the Inflation Reduction Act of 2022.

 See accompanying Notes to Consolidated Financial Statements.

 6

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF CASH FLOWS

 Years ended December 31,

 (In thousands)

 2025

 2024

 2023

 Operating Activities:

 Net income

  $
    1,002,802

  $
    768,707

  $
    867,840

 Adjustments to reconcile net income to net cash provided by operating activities:

 Provision for credit losses

 210,000

 222,000

 150,747

 Deferred income tax expense (benefit)

 47,588

 18,183

 (53,634
 )

 Stock-based compensation

 56,823

 55,141

 54,087

 Depreciation and amortization of property and equipment and intangible assets

 73,346

 71,531

 76,490

 Net (accretion) and amortization of interest-earning assets and borrowings

 (165,552
 )

 (95,281
 )

 (23,267
 )

 Amortization of low-income housing tax credit
investments

 115,274

 80,902

 71,775

 Reduction of ROU lease assets

 29,960

 31,275

 30,616

 Net (gain) loss on sale of investment securities

 (220
 )

 136,224

 33,620

 Originations of loans held for sale

 (9,843
 )

 (6,806
 )

 (13,319
 )

 Proceeds from sale of loans held for sale

 8,068

 8,310

 13,882

 Net loss on sale of factored receivables portfolio

 —

 15,977

 —

 Net (gain) on sale of mortgage servicing rights

 —

 (11,655
 )

 —

 (Increase) in cash surrender value of life insurance policies

 (33,219
 )

 (27,712
 )

 (26,228
 )

 (Gain) from life insurance policies

 (4,777
 )

 (14,065
 )

 (3,566
 )

 (Gain) on extinguishment of long-term debt

 (9,767
 )

 —

 (698
 )

 (Gain) on sale of alternative investments

 (8,806
 )

 (14,763
 )

 —

 Other operating activities, net

 (16,042
 )

 (15,998
 )

 2,760

 Net decrease (increase) in loans held for sale

 3

 (49,566
 )

 —

 Net (increase) decrease in derivative contract assets and liabilities

 (185,003
 )

 20,526

 (73,295
 )

 Net decrease (increase) in prepaid expenses and other assets

 37,177

 246,752

 (13,774
 )

 Net (decrease) in accrued expenses and other liabilities

 (89,676
 )

 (35,382
 )

 (115,387
 )

 Net cash provided by operating activities

 1,058,136

 1,404,300

 978,649

 Investing Activities:

 Purchases of
 available-for-sale investment securities

 (1,990,902
 )

 (3,202,766
 )

 (2,372,249
 )

 Proceeds from principal payments, maturities, and calls of available-for-sale investment securities

 1,292,532

 892,965

 591,207

 Proceeds from sale of
 available-for-sale investment securities

 14,880

 2,142,462

 789,603

 Purchases of
 held-to-maturity investment securities

 —

 (1,778,098
 )

 (891,761
 )

 Proceeds from principal payments, maturities, and calls of held-to-maturity investment securities

 538,566

 457,433

 390,073

 Net (increase) decrease in Federal Home Loan Bank and Federal Reserve Bank stock

 (35,068
 )

 5,539

 119,018

 Alternative investments (capital calls), net of returns of capital

 (293,451
 )

 (160,062
 )

 (27,430
 )

 Proceeds from sales of alternative investments

 13,441

 19,588

 —

 Net (increase) in loans

 (4,632,549
 )

 (2,488,796
 )

 (1,653,257
 )

 Proceeds from sale of loans not originated for sale

 400,017

 569,538

 625,968

 Proceeds from sale of mortgage servicing rights

 —

 18,588

 —

 Proceeds from sale of foreclosed properties and repossessed assets

 2,055

 8,526

 4,033

 Proceeds from sale of property and equipment

 4,337

 6,769

 6,894

 Purchases of property and equipment

 (49,566
 )

 (35,844
 )

 (40,303
 )

 Proceeds from life insurance policies

 18,574

 34,358

 20,098

 Cash paid for acquisitions of HSA deposits

 (6,428
 )

 —

 —

 Net cash paid for acquisition of SecureSave

 (24,401
 )

 —

 —

 Net cash paid for acquisition of Ametros

 —

 (359,460
 )

 —

 Net cash paid for acquisition of interLINK

 —

 —

 (157,646
 )

 Net cash (used for) investing activities

 (4,747,963
 )

 (3,869,260
 )

 (2,595,752
 )

 See accompanying Notes to Consolidated Financial Statements.

 7

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF CASH FLOWS, continued

 Years ended December 31,

 (In thousands)

 2025

 2024

 2023

 Financing Activities:

 Net increase in deposits

 4,006,261

 3,697,887

 6,721,028

 Net increase (decrease) in Federal Home Loan Bank advances

 870,610

 (249,910
 )

 (3,100,534
 )

 Net increase (decrease) in securities sold under agreements to repurchase and federal funds
purchased

 252,570

 (114,219
 )

 (693,443
 )

 Repayment of long-term debt

 (499,000
 )

 (132,550
 )

 (16,752
 )

 Proceeds from the issuance of long-term debt

 347,389

 —

 —

 Debt issuance costs

 (1,636
 )

 —

 —

 Payment of contingent consideration

 (11,447
 )

 (4,050
 )

 —

 Dividends paid to common stockholders

 (266,830
 )

 (274,545
 )

 (278,155
 )

 Dividends paid to preferred stockholders

 (16,650
 )

 (16,650
 )

 (16,650
 )

 Exercise of stock options

 67

 254

 1,723

 Common stock repurchase program

 (593,654
 )

 (65,403
 )

 (107,984
 )

 Common shares acquired related to stock compensation plan activity

 (22,762
 )

 (17,215
 )

 (16,278
 )

 Net cash provided by financing activities

 4,064,918

 2,823,599

 2,492,955

 Net increase in cash and cash equivalents

 375,091

 358,639

 875,852

 Cash and cash equivalents, beginning of period

 2,074,434

 1,715,795

 839,943

 Cash and cash equivalents, end of period

  $
    2,449,525

  $
    2,074,434

  $
    1,715,795

 See accompanying Notes to Consolidated Financial Statements.

 8

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 Note 1: Summary of Significant Accounting Policies

 Nature of Operations
 The Company is a bank holding company
that has elected to be treated as a financial holding company under the BHC Act, incorporated under the laws of Delaware in 1986, and headquartered in Stamford, Connecticut. As of December 31, 2025, the Company had $84.1 billion in total
consolidated assets.
 The Bank is a commercial bank with a national bank charter focused on providing financial products and services to businesses,
individuals, and families. While its core footprint spans the Northeast from the New York metropolitan area to Rhode Island and Massachusetts, certain businesses operate in extended geographies. The Bank offers three differentiated lines of
business: Commercial Banking, Healthcare Financial Services, and Consumer Banking.
 Basis of Presentation

 The Consolidated Financial Statements have been prepared in accordance with GAAP, and include the accounts of the Company and all other entities in which the
Company has a controlling financial interest. Intercompany transactions and balances have been eliminated in consolidation. Assets under administration or assets under management that the Company holds or manages in a fiduciary or agency capacity
for customers are not included on the accompanying Consolidated Balance Sheets. Certain prior period amounts presented in the Consolidated Statement of Cash Flows and disclosed in Note 12: Accumulated Other Comprehensive (Loss), Net of Tax and Note
18: Retirement Benefit Plans have been reclassified to conform to the current year’s presentation. These reclassifications did not have a significant impact on the Company’s Consolidated Financial Statements.

 Principles of Consolidation
 The purpose of Consolidated
Financial Statements is to present the results of operations and the financial position of the Company and its subsidiaries as if the consolidated group were a single economic entity. In accordance with the applicable accounting guidance for
consolidations, the Consolidated Financial Statements include any VOE in which the Company has a controlling financial interest and any VIE for which the Company is deemed to be the primary beneficiary. The Company generally consolidates its VOEs if
the Company, directly or indirectly, owns more than 50% of the outstanding voting shares of the entity, and if the non-controlling stockholders do not hold any substantive participating or
controlling rights. The Company evaluates VIEs to understand the purpose and design of the entity, and its involvement in the ongoing activities of the VIE, and will consolidate the VIE if it has (i) the power to direct the activities of the
VIE that most significantly affect the VIE’s economic performance, and (ii) an obligation to absorb losses of the VIE, or the right to receive benefits from the VIE, that could potentially be significant to the VIE. The Company accounts
for unconsolidated partnerships and certain other investments using the equity method of accounting if it has the ability to significantly influence the operating and financial policies of the investee. This is generally presumed to exist when the
Company owns between 20% and 50% of a corporation’s voting common stock or in-substance common stock, or when it has greater than 3% to 5% interest in a limited partnership
or similarly structured entity. Additional information regarding consolidated and non-consolidated VIEs can be found within Note 14: Variable Interest Entities.

 Use of Estimates
 The preparation of the Consolidated
Financial Statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the 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.

 Business Combinations
 Business combinations are accounted
for under the acquisition method, in which the identifiable assets acquired and liabilities assumed are generally measured and recognized at fair value as of the acquisition date, with the excess of the purchase price over the fair value of the net
assets acquired recognized as goodwill. Items such as acquired ROU lease assets and operating lease liabilities as lessee, employee benefit plans, and income-tax related balances are recognized in accordance
with other applicable GAAP, which may result in measurements that differ from fair value. After the adoption of ASU No. 2021-08—Business Combinations (Topic 805)—Accounting for Contract Assets and
Contract Liabilities from Contracts with Customers, contract assets and contract liabilities from contracts with customers, may result in measurements that differ from fair value as well. The Company uses estimates and assumptions as part of the
purchase price allocation process to determine the fair value of assets acquired and liabilities assumed as of the acquisition date. These estimates and assumptions are inherently uncertain and subject to refinement during the measurement period,
which may extend for up to one year from the acquisition date.

 9

 Business combinations are included in the Consolidated Financial Statements from the respective dates of
acquisition. Historical reporting periods reflect only the results of legacy Webster operations. Acquisition-related costs are expensed in the period incurred and presented within the applicable non-interest
expense category. Additional information regarding the Company’s business combinations can be found within Note 2: Business Developments.
 Cash and
Cash Equivalents
 Cash and cash equivalents is comprised of Cash and due from banks and Interest-bearing deposits. Cash equivalents have an original
maturity of three months or less.
 Cash and due from banks includes cash on hand, certain deposits at the FRB of New York, and cash due from
banks. Restricted cash related to Federal Reserve requirements, cash collateral received on derivative positions, and cash due from a bank held in connection with a compensating balance arrangement are also included in Cash and due from banks.

 Interest-bearing deposits includes deposits at the FRB of New York in excess of reserve requirements and federal funds sold to other financial
institutions. Restricted cash related to a deposit with contractual use limitations held in connection with a third-party arrangement is also included in Interest-bearing deposits.

 The following table summarizes supplemental disclosures of cash flow information and non-cash investing and financing
activities:

 Years ended December 31,

 (In thousands)

 2025

 2024

 2023

 Supplemental disclosure of cash flow information:

 Interest paid

  $
    1,550,091
  

  $
    1,611,201
  

  $
    1,248,620
  

 Income taxes paid (1)

 85,386

 124,817

 234,549

 Non-cash investing and financing
activities:

 Transfer of loans held for investment to foreclosed properties and repossessed assets

  $
 8,178

  $
 2,305

  $
 10,485

 Transfer of returned finance lease equipment to assets held for sale

 3,220

 5,626

 5,139

 Transfer of loans held for investment to loans held for sale

 368,620

 680,159

 629,172

 Transfer of loans held for sale to loans held for investment

 —

 133,168

 —

 Transfer of property and equipment to assets held for sale

 —

 750

 —

 ROU lease assets obtained in exchange for operating lease liabilities

 42,611

 10,444

 22,989

 Settlement of outstanding loan balance through receipt of equity interest

 19,180

 —

 —

 Approved commitments to fund LIHTC investments

 166,494

 304,269

 334,947

 Receipt of Ametros member deposits from other financial institutions

 —

 285,705

 —

 Business combinations (2):

 Tangible assets acquired

  $
 5,214

  $
 256,957

  $
 24,318

 Goodwill and other intangible assets

 38,944

 417,085

 157,361

 Liabilities assumed (3)

 3,303

 299,507

 7,994

 Forgiveness of long-term debt

 —

 12,875

 —

 Pre-existing equity interest

 8,034

 2,200

 —

 Contingent consideration

 8,420

 —

 16,039

 (1)
 Income taxes paid, net of refunds received, are further disaggregated by jurisdiction in the table below, in
accordance with the disclosure requirements of ASU No. 2023-09—Income Taxes (Topic 740): Improvements to Income Tax Disclosures.

 (2)
 Reflects the effects from the acquisition of SecureSave during the year ended December 31, 2025, Ametros
during the year ended December 31, 2024, and interLINK during the year ended December 31, 2023. In addition, the amounts for 2023 include adjustments to fair values of assets acquired and liabilities assumed related to the Bend acquisition
and Sterling merger, which were recognized during the one-year measurement period.

 (3)
 For the year ended December 31, 2024, the amount presented reflects the sum of the $293.7 million of
liabilities assumed from Ametros and the $5.8 million liability assumed for the Seller’s transaction expenses, which was included as part of the purchase price consideration and paid by the Company at closing.

 10

 Disaggregation of Income Taxes Paid

 Upon adoption of ASU No. 2023-09—Income Taxes (Topic 740): Improvements to Income Tax Disclosures, the following
table summarizes the disaggregation of income taxes paid, net of refunds received, by jurisdiction:

 Years ended December 31,

 (In thousands)

    2025   

    2024   

    2023   

 Federal

  $
 55,350

  $
 70,299

  $
 181,073 

 State and local:

 Massachusetts

 12,581

 *

 * 

 New Jersey

 6,000

 *

 * 

 Illinois

 4,587

 *

 * 

 New York State

 *

 23,486

 15,322 

 New York City

 *

 14,001

 12,553 

 Other

 6,868

 17,031

 25,601 

 Total state and local

 30,036

 54,518

 53,476 

 Total income taxes paid, net of refunds received

  $
   85,386

  $
   124,817

  $
   234,549 

 *The amount of income taxes paid, net of refunds received, during the year for this jurisdiction does not meet the 5%
disaggregation threshold and is included in Other.
 Investments in Debt Securities

 Debt security transactions are recognized on the trade date, which is the date the order to buy or sell the security is executed. Investments in debt securities
are classified as available-for-sale or held-to-maturity at the time of purchase. Any
classification change subsequent to the trade date is reviewed for compliance with corporate objectives and accounting policies.
 Debt securities classified
as available-for-sale are recorded at fair value with unrealized gains and losses recorded as a component of AOCL. If a debt security is transferred from available-for-sale to held-to-maturity, it is recorded at fair value at the time of transfer
and any respective gain or loss would be recorded as a separate component of AOCL and amortized as an adjustment to interest income over the remaining life of the security. Debt securities classified as available-for-sale are reviewed for credit losses when the fair value of a security falls below the amortized cost basis and the decline is evaluated to determine if any portion is attributable to credit
loss. The decline in fair value attributable to credit loss is recorded directly to earnings, with a corresponding allowance for credit loss, limited to the amount that fair value is less than the amortized cost. If the credit quality subsequently
improves, previously recorded allowance amounts may be reversed. An available-for-sale debt security will be placed on
 non-accrual status if collection of principal and interest in accordance with contractual terms is doubtful. When the Company intends to sell an impaired available-for-sale debt security, or if it is more likely than not that the Company will be required to sell the security prior to recovery of the amortized cost basis, the entire fair value adjustment will
immediately be recognized in earnings through non-interest income. The gain or loss on sale is calculated using the carrying value plus any related AOCL balance associated with the securities sold.

 Debt securities classified as held-to-maturity are those in which the Company
has the ability and intent to hold to maturity. Debt securities classified as held-to-maturity are recorded at amortized cost net of unamortized premiums and discounts.
Discount accretion income and premium amortization expense are recognized as interest income using the effective interest method, with consideration given to prepayment assumptions on mortgage-backed securities. Premiums are amortized to the
earliest call date for debt securities purchased at a premium, with explicit, non-contingent call features and are callable at a fixed price and preset date. Debt securities classified as held-to-maturity are reviewed for credit losses under the CECL model with an allowance recorded on the balance sheet for expected lifetime credit losses. The ACL is calculated
on a pooled basis using statistical models which include forecasted scenarios of future economic conditions. Forecasts revert to long-run loss rates implicitly through the economic scenario, generally over
three years. If the risk for a particular security no longer matches the collective assessment pool, it is removed and individually assessed for credit deterioration. The non-accrual policy for held-to-maturity debt securities is the same as for available-for-sale debt securities.

 A zero credit loss assumption is maintained for U.S. Treasuries and agency-backed securities in both the available-for-sale and held-to-maturity portfolios, as applicable. This assumption is subject to quarterly review to ensure it
remains appropriate. Additional information regarding investments in debt securities can be found within Note 3: Investment Securities.

 11

 Investments in Equity Securities

 The Company’s accounting treatment for non-consolidated equity investments differs for those with and without
readily determinable fair values. Equity investments with readily determinable fair values are recorded at fair value with changes in fair value recorded in non-interest income. For equity investments without
readily determinable fair values and are not already accounted for under the equity method, the Company elected the measurement alternative, and therefore carries these investments at cost, less impairment, if any, plus or minus changes in
observable prices. Certain equity investments that do not have a readily available fair value may qualify for NAV measurement based on specific requirements. The Company’s alternative investments accounted for at NAV consist of investments in non-public entities that generally cannot be redeemed since the Company’s investments are distributed as the underlying equity is liquidated. On a quarterly basis, the Company reviews its equity investments
without readily determinable fair values for impairment. If the equity investment is considered impaired, an impairment loss equal to the amount by which the carrying value exceeds its fair value is recorded through a charge to earnings. The
impairment loss may be reversed in a subsequent period if there are observable transactions for the identical or similar investment of the same issuer at a higher amount than the carrying amount that was established when the impairment was
recognized. Impairments, as well as upward or downward adjustments resulting from observable price changes in orderly transactions for identical or similar investments, are included in non-interest income.

 Equity investments in entities that finance affordable housing and other community development projects provide a return primarily through the realization
of tax benefits. The Company applies the proportional amortization method to account for its investments in qualified affordable housing projects.

 Investment in Federal Home Loan Bank and Federal Reserve Bank Stock

 The Bank is a member of the FHLB and the Federal Reserve System, and is required to maintain an investment in capital stock of both a FHLB and FRB. Based on
redemption provisions, FHLB and FRB stock has no quoted market value and is carried at cost. Membership stock is reviewed for impairment if economic circumstances would warrant review.

 Loans Held for Sale
 Loans that are classified as held for
sale at the time of origination are accounted for under the fair value option. Loans not originated for sale but subsequently transferred to held for sale are valued at the lower of cost or fair value on an individual asset basis. Any cost amount in
excess of fair value is recorded as a valuation allowance and recognized as a reduction of other non-interest income. Interest income on loans held for sale is recognized based on contractual rates and is
reflected in Loans held for sale interest income on the accompanying Consolidated Statements of Income. Gains or losses on the sale of loans held for sale are recorded as part of Other income on the accompanying Consolidated Statements of Income.

 For the purpose of presentation in the accompanying Consolidated Statements of Cash Flows, cash flows from loans are classified based on management’s
intent to either sell the loan or hold the loan as an investment for the foreseeable future. When management’s intent is to sell the loan, the cash flows of that loan are presented as operating activities. When management’s intent is to
hold the loan as an investment for the foreseeable future, the cash flows of that loan are presented as investing activities. Additionally, proceeds from the sale of loans that were originated for sale are presented as operating activities, and
proceeds from the sale of loans that were originated for investment and then subsequently transferred to held for sale are presented as investing activities consistent with the original classification.

 Transfers and Servicing of Financial Assets
 Transfers of
financial assets are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is generally considered to have been surrendered when: (i) the transferred assets are legally isolated from the
Company or its consolidated affiliates, even in bankruptcy or other receivership, (ii) the transferee has the right to pledge or exchange the assets with no conditions that constrain the transferee and provide more than a trivial benefit to the
Company, and (iii) the Company does not maintain the obligation or unilateral ability to reclaim or repurchase the assets. Transfers of financial assets that do not qualify for sale accounting are reported as collateralized borrowings.
Accordingly, the related assets remain on the Company’s consolidated balance sheets and continue to be reported and accounted for as if the transfer had not occurred as discussed within the next policy below.

 The Company sells financial assets in the normal course of business, the majority of which are residential mortgage loan sales to government-sponsored
enterprises through established programs, as well as commercial loan sales through participation agreements, and other individual or portfolio loan and securities sales. In accordance with the accounting guidance for asset transfers, the Company
considers any ongoing involvement with transferred assets in determining whether the assets should be derecognized from the balance sheet. With the exception of servicing, the Company’s continuing involvement with financial assets sold is
minimal, and generally is limited to market customary representation and warranty clauses covering certain characteristics of the mortgage loans that were sold, and the Company’s origination process. The gain or loss on sale depends on the
previous carrying amount of the transferred financial assets, the consideration received, and the fair value of any other assets obtained or liabilities incurred in exchange for the transferred assets.

 12

 When the Company sells financial assets, it may retain servicing rights and/or other interests in the
financial assets. Servicing assets and any other interests held by the Company are initially measured at fair value, and subsequently measured using the amortization method.

 Securities Sold Under Agreements to Repurchase
 These
agreements are accounted for as secured financing transactions since the Company maintains effective control over the transferred investment securities and the transfer meets the other criteria for such treatment. Obligations to repurchase the sold
investment securities are reflected as a liability on the accompanying Consolidated Balance Sheets. The investment securities sold with agreement to repurchase to wholesale dealers are transferred to a custodial account for the benefit of the dealer
or to the bank with whom each transaction is executed. The dealers or banks may sell, loan, or otherwise dispose of such securities to other parties in the normal course of their operations and agree to resell to the Company the same securities at
the maturity date of the agreement. The Company also enters into repurchase agreements with Bank customers. The investment securities sold to Bank customers with agreements to repurchase are not transferred, but internally pledged to the repurchase
agreement transaction. As such, the underlying investment securities pledged remain on the accompanying Consolidated Balance Sheets. Additional information regarding securities sold under agreements to repurchase can be found within Note 10:
Borrowings.
 Loans and Leases
 Loans and leases are
stated at the principal amount outstanding, net of amounts charged-off, unamortized premiums and discounts, and deferred loan and lease fees or costs, which are recognized as yield adjustments in interest
income using the effective interest method. These yield adjustments are amortized over the contractual life of the related loans and leases and are adjusted for prepayments as they occur. Interest on loans and leases is credited to interest income
as earned based on the interest rate applied to principal amounts outstanding. The Company has elected to present accrued interest receivable separately from the amortized cost basis of Loans and leases on the accompanying Consolidated Balance
Sheets. Amounts of cash receipts and cash payments for loans and leases are presented net within Investing activities on the Consolidated Statements of Cash Flows.

 Non-accrual Loans

 Loans are placed on non-accrual status when full collection of principal and interest in accordance with contractual
terms is not expected based on available information, which generally occurs when principal or interest payments become 90 days delinquent unless the loan is well secured and in the process of collection, or sooner if circumstances indicate that the
borrower may be unable to meet contractual principal or interest payments. The Company considers a loan to be “well-secured” when it is secured by collateral in the form of liens on, or pledges of, real or personal property that have a
realizable value sufficient to discharge the debt in full, or when it is secured by a contractual guarantee of a financially responsible party. The Company considers a loan “in the process of collection” if collection of the debt is
proceeding in due course either through legal action or through collection efforts not involving legal action that are reasonably expected to result in repayment of the debt or in its restoration to a current status in the near future.

 When loans and leases are placed on non-accrual status, the accrual of interest income and the amortization or accretion
of premiums, discounts, and deferred fees and costs is discontinued, and any previously accrued interest is reversed as a reduction of interest income. For commercial loans and leases, if the Company determines that repayment of non-accrual loans and leases is not expected, any payment received is applied to principal until the unpaid balance has been fully recovered. Any excess is then credited to interest income. For consumer loans, if
the Company determines that principal can be repaid, interest payments are taken into income as received on a cash basis.
 Loans are generally removed from non-accrual status when they become current as to principal and interest or demonstrate a period of performance under the contractual terms and, in the opinion of management, are fully collectible as to principal
and interest. For commercial loans, a sustained period of repayment performance is generally required. Pursuant to regulatory guidance, a loan discharged under Chapter 7 of the U.S. bankruptcy code is removed from
 non-accrual status when full repayment of the remaining pre-discharged contractual principal and interest is expected, and there have been at least six consecutive months of current payments. Additional
information regarding non-accrual loans and leases can be found within Note 4: Loans and Leases.
 Allowance for
Credit Losses on Loans and Leases
 The ACL on loans and leases, which is established through a provision charged to expense, is a contra-asset account
that offsets the amortized cost basis of loans and leases for the credit losses that are expected to occur over the life of the asset. Executive management reviews and advises on the adequacy of the allowance on a quarterly basis, which is
maintained at a level that management deems to be sufficient to cover expected credit losses within the loan and lease portfolios. An ACL on accrued interest for a loan is not measured since accrued interest income is reversed against interest
income for non-accrual loans immediately after their non-accrual classification.

 13

 The ACL on loans and leases is determined using the CECL model, whereby an expected lifetime credit loss is
recognized at the origination or purchase of an asset, including those acquired through a business combination, which is then reassessed at each reporting date over the contractual life of the asset. The calculation of expected credit losses
includes consideration of past events, current conditions, and reasonable and supportable economic forecasts that affect the collectability of the reported amounts. Generally, expected credit losses are determined through a pooled, collective
assessment of loans and leases with similar risk characteristics. However, if the risk characteristics of a loan or lease change such that it no longer aligns to that of the collectively assessed pool, it is removed from the population and
individually assessed for credit losses. The total ACL on loans and leases recorded by management represents the aggregated estimated credit loss determined through both the collective and individual assessments.

 Collectively Assessed Loans and Leases. Collectively assessed loans and leases are segmented based on product type and credit quality, and expected
losses are determined using models that follow a PD, LGD, or EAD framework. Under these frameworks, expected credit losses are calculated as the product of the probability of a loan defaulting, expected loss rate given the occurrence of a default,
and the expected exposure of a loan at default. Summing the product across loans over their lives yields the lifetime expected credit losses for a given portfolio. The Company’s PD and LGD calculations are predictive models that measure the
current risk profile of the loan pools using forecasts of future macroeconomic conditions, historical loss information, loan-level risk attributes, and credit quality indicators. The calculation of EAD follows an iterative process to determine the
expected remaining principal balance of a loan based on historical paydown rates for loans of a similar segment within the same portfolio. The calculation of portfolio exposure in future quarters incorporates expected losses, the loan’s
amortization schedule, and prepayment rates.
 The Company incorporates forecasts of macroeconomic variables in the determination of expected credit losses.
Macroeconomic variables are selected for each class of financing receivable based on relevant factors, such as asset type and the correlation of the variables to credit losses, among others. Data from the forecast scenario of these macroeconomic
variables are used as inputs to the modeled loss calculation.
 The Company’s models incorporate a baseline and a downside macroeconomic forecast
scenario, and management weights the scenarios based on reviews of variable forecasts and comparisons to expectations using readily available data to arrive at a macroeconomic scenario for each quarter end over a reasonable and supportable forecast
period. The development of the reasonable and supportable forecast assumes that each portfolio will revert to its long-term loss rate expectation. The reasonable and supportable forecast period is two years, after which the reversion period is one
year. Models use output reversion and revert to mean historical portfolio and risk rating specific loss rates on a straight-line basis in the third year of the forecast.

 The commercial models use unemployment, gross domestic product, corporate profits, housing starts, and retail sales (for commercial unfunded); the residential
models use the Case-Shiller Home Price Index and the Federal Housing Finance Agency Home Price Index. Forecasted economic scenarios are sourced from a third party. Data from the baseline forecast scenario is used as the input to the modeled loss
calculation. Changes in forecasts of macroeconomic variables will impact expectations of lifetime credit losses calculated by the loss models. However, the impact of changes in macroeconomic forecasts may be different for each portfolio and will
reflect the credit quality and nature of the underlying assets at that time.
 A portion of the collective ACL is comprised of qualitative adjustments for
risk characteristics that are not reflected or captured in the quantitative models, but are likely to impact the measurement of estimated credit losses. Qualitative adjustments are based on management’s judgment of the Company, market,
industry, or business specific data, and may be applied in relation to economic forecasts when relevant facts and circumstances are expected to impact credit losses, particularly in times of significant volatility in economic activity. Qualitative
factors that are generally used in the Company’s models for all loan and lease portfolios include, but are not limited to, nature and volume of portfolio growth, credit quality trends, underwriting exception levels, quality of internal loan
review, credit concentrations, and staffing trends.
 In addition to the above considerations, the ACL calculation includes expectations of prepayments and
recoveries. Extensions, renewals, and modifications are not included in the collective assessment.
 Individually Assessed Loans and Leases. When
loans and leases no longer align to the risk characteristics of the collectively assessed pool, they are removed from the collectively assessed population and individually assessed for credit losses. Generally, all
 non-accrual loans and loans with a charge-off are individually assessed.

 14

 Individual assessment for commercial loans that are considered to be collateral dependent is based on the
fair value of the collateral less estimated cost to sell, the present value of the expected cash flows from the operation of the collateral, or a probability-weighted scenario approach of both of these methods. If a loan is not collateral dependent,
the individual assessment is based on a discounted cash flow approach. For collateral dependent commercial loans and leases, the Company’s process requires the Company to determine the fair value of the collateral by obtaining a third-party
appraisal or asset valuation, an interim valuation analysis, blue book reference, or other internal methods. Whenever the Company has a third-party real estate appraisal performed by independent licensed appraisers, a licensed in-house appraisal officer or qualified individual reviews these appraisals for compliance with the Financial Institutions Reform Recovery and Enforcement Act and the Uniform Standards of Professional Appraisal
Practice.
 Individual assessment for consumer loans are based on the fair value of collateral less the estimated costs to sell or loss factor approach based
on historical loss rates. For residential and consumer collateral dependent loans, a third-party appraisal is obtained upon loan default. Fair value of the collateral for residential and consumer collateral dependent loans is reevaluated every six
months, by either obtaining a new appraisal or other internal valuation method. Fair value is also reassessed, with any excess amount charged off, for residential and home equity loans that reach 180 days past due per Federal Financial Institutions
Examination Council guidelines.
 A fair value shortfall relative to the amortized cost balance is reflected as an allowance within the ACL on loans and
leases. Subsequent to an appraisal or other fair value estimate, should reliable information come to management’s attention that the value has declined further, an additional allowance may be recorded to reflect the particular situation,
thereby increasing the ACL on loans and leases. If the credit quality subsequently improves, the allowance is reversed up to a maximum of the previously recorded credit losses. Any individually assessed loan for which no specific allowance is
necessary is the result of either sufficient cash flow or sufficient collateral coverage relative to the amortized cost. Additional information regarding the ACL on loans and leases can be found within Note 4: Loans and Leases.

 Charge-off of Uncollectible Loans

 If all or a portion of a loan is deemed to be no longer collectible upon the occurrence of a loss-confirming event, a
 charge-off may be recognized. Charge-offs reduce the amortized cost basis of the loan with a corresponding reduction to the ACL. For commercial loans, loss confirming events usually involve the receipt of
specific adverse information about the borrower. The Company will generally recognize charge-offs for commercial loans on a case-by-case basis based on the review of the
entire credit relationship and financial condition of the borrower. Loss-confirming events for consumer loans, such as bankruptcy or protracted delinquency, are typically based on established thresholds rather than by specific adverse information
about the borrower.
 PCD Loans and Leases
 PCD loans and
leases are defined as those that have experienced a more-than-insignificant deterioration in credit quality since origination. The Company considers a variety of factors to evaluate and identify whether acquired loans are PCD, including but not
limited to, nonaccrual status, delinquency, whether the borrower is experiencing financial difficulty, partial charge-offs, decreases in FICO scores, risk rating downgrades, and other factors. Upon acquisition, expected credit losses are added to
the fair value of individual PCD loans and leases to determine the amortized cost basis. After initial recognition, any changes to the estimate of expected credit losses, favorable or unfavorable, are recorded as a provision for credit loss during
the period of change.
 PCD accounting is also applied to loans and leases previously charged-off by the acquiree if
the Company has contractual rights to the cash flows at the acquisition date. The Company recognizes an additional ACL for amounts previously charged-off by the acquiree with a corresponding increase to the
amortized costs basis of the acquired asset. Balances deemed to be uncollectible are immediately charged-off in accordance with the Company’s charge-off policies,
resulting in the establishment of the initial ACL for PCD loans and leases to be recorded net of these uncollectible balances.
 Allowance for Credit
Losses on Unfunded Loan Commitments
 The ACL on unfunded loan commitments provides for potential exposure inherent with funding the unused portion of
legal commitments to lend that are not unconditionally cancellable by the Company. Accounting for unfunded loan commitments follows the CECL model. The calculation of the allowance includes the probability of funding to occur and a corresponding
estimate of expected lifetime credit losses on amounts assumed to be funded. Loss calculation factors are consistent with the ACL methodology for funded loans using the PD and LGD applied to the underlying borrower risk and facility grades, a draw
down factor applied to utilization rates, relevant forecast information, and management’s qualitative factors. The ACL on unfunded credit commitments is included within Accrued expenses and other liabilities on the accompanying Consolidated
Balance Sheets. Additional information regarding the ACL on unfunded loan commitments can be found within Note 22: Commitments and Contingencies.

 15

 Foreclosed and Repossessed Assets

 Real estate acquired through foreclosure or completion of a deed in lieu of foreclosure and other assets acquired through repossession are recorded at fair
value less estimated cost to sell at the date of transfer. Subsequent to the acquisition date, the foreclosed and repossessed assets are carried at the lower of cost or fair value less estimated selling costs and are included within Accrued interest
receivable and other assets on the accompanying Consolidated Balance Sheets. Independent appraisals generally are obtained to substantiate fair value and may be subject to adjustment based upon historical experience or specific geographic trends
impacting the property. Upon transfer to OREO, the excess of the loan balance over fair value less cost to sell is charged off against the ACL. Subsequent write-downs in value, maintenance costs as incurred, and gains or losses upon sale are charged
to Other expense on the accompanying Consolidated Statements of Income.
 Property and Equipment

 Property and equipment is carried at cost, less accumulated depreciation and amortization. Depreciation and amortization is computed on a straight-line basis
over the estimated useful lives of the assets, as illustrated in the following table. If shorter, leasehold improvements are amortized over the terms of the respective leases.

   Minimum  

   Maximum  

 Building and improvements

 5

 -

 40

 years    

 Leasehold improvements

 5

 -

 20

 years    

 Furniture, fixtures, and equipment

 5

 -

 10

 years    

 Data processing equipment and software

 3

 -

 7

 years    

 Repairs and maintenance costs are expensed as incurred, while significant improvements are capitalized. Property and equipment
that is actively marketed for sale is reclassified to assets held for disposition. The cost and accumulated depreciation and amortization of property and equipment that is sold, retired, or otherwise disposed of, is eliminated from accounts and any
resulting gain or loss is included in Other expense on the accompanying Consolidated Statements of Income. Additional information regarding property and equipment can be found within Note 5: Premises and Equipment.

 Operating Leases
 The Company determines if an arrangement
is a lease at inception by assessing whether there is an identified asset and whether the contract conveys the right to control the use of the identified asset for a period of time in exchange for consideration. As lessee, operating leases with a
term greater than one year are recognized as lease liabilities and corresponding ROU assets on the lease commencement date. The Company has elected the short-term lease practical expedient; as such, the Company does not to recognize lease
liabilities and ROU assets on operating leases with terms of one year or less. An ROU asset is measured based on the present value of the future minimum lease payments, adjusted for any initial direct costs, incentives, or other payments prior to
the lease commencement date. A lease liability represents a legal obligation to make lease payments and is measured based on the present value of the future minimum lease payments. The Company utilizes the incremental borrowing rate, which is the
rate of interest that would be incurred to borrow on a collateralized basis over a similar term on an amount equal to the lease payments in a similar economic environment since the interest rate implicit in the lease contract is typically not
readily determinable. Variable lease payments that are dependent on either an index or rate are initially measured using the index or rate at the commencement date and included in the measurement of the lease liability. Renewal options are not
included as part of the ROU asset or lease liability unless the renewal option is deemed reasonably certain to be exercised. ROU assets and operating lease liabilities are included in Premises and equipment and Accrued expenses and other
liabilities, respectively, on the accompanying Consolidated Balance Sheets.
 For real estate leases, lease components and
 non-lease components are accounted for as a single lease component. For equipment leases, lease components and non-lease components are accounted for separately.
Operating lease expense, which is comprised of operating lease costs and variable lease costs, net of sublease income, is amortized on a straight-line basis and reflected as a part of Occupancy or Technology and equipment expense on the accompanying
Consolidated Statements of Income. Additional information regarding the Company’s lessee arrangements can be found within Note 6: Leasing.

 Goodwill
 Goodwill represents the excess purchase price of
businesses acquired over the fair value of the identifiable net assets acquired and is assigned to specific reporting units. Goodwill is not subject to amortization but rather is evaluated for impairment annually, or more frequently if events occur
or circumstances change indicating it would more likely than not result in a reduction of the fair value of the reporting units below their carrying value, including goodwill.

 16

 Goodwill may be evaluated for impairment by first performing a qualitative assessment. If the qualitative
assessment indicates that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill, or, if for any other reason the Company determines it to be appropriate, then a quantitative
assessment will be performed. The quantitative assessment process utilizes an income and market approach to arrive at an indicated fair value range for the reporting units. The fair value calculated for each reporting unit is compared to its
carrying amount, including goodwill, to ascertain if goodwill impairment exists. If the fair value exceeds the carrying amount, including goodwill for a reporting unit, it is not considered to be impaired. If the fair value is below the carrying
amount, including goodwill for a reporting unit, then an impairment charge is recognized for the amount by which the carrying amount exceeds the calculated fair value, up to but not exceeding the amount of goodwill allocated to the reporting unit.
The resulting amount is charged to Other expense on the accompanying Consolidated Statements of Income.
 The Company completed a quantitative assessment for
its reporting units during its most recent annual impairment review. Based on this quantitative assessment, the Company determined that there was no evidence of impairment to the balance of its goodwill. Additional information regarding goodwill can
be found within Note 7: Goodwill and Other Intangible Assets.
 Other Intangible Assets

 Other intangible assets represent purchased assets that lack physical substance but can be distinguished from goodwill because of contractual or other legal
rights, or because they are capable of being sold or exchanged either separately or in combination with a related contract, asset, or liability. Other intangible assets with finite useful lives, such as core deposits and customer relationships, are
amortized to non-interest expense over their estimated useful lives and are evaluated for impairment whenever events occur or circumstances change indicating that the carrying amount of the asset may not be
recoverable. Recognized impairment losses are charged to Other expense on the accompanying Consolidated Statements of Income. Additional information regarding other intangible assets can be found within Note 7: Goodwill and Other Intangible Assets.

 Cash Surrender Value of Life Insurance
 Bank-owned life
insurance represents the cash surrender value of life insurance policies on certain current and former employees of Webster and Sterling, and employees of banks that Webster and Sterling had previously acquired. Cash surrender value increases and
decreases are recorded in Non-interest income. Death benefit proceeds in excess of the cash surrender value are recorded in Other income upon the death of the insured.

 Revenue From Contracts With Customers
 Revenue from
contracts with customers comprises non-interest income earned in exchange for services provided to customers and is recognized either when services are completed or as they are rendered. These revenue streams
include Deposit service fees, Wealth and investment services, and non-significant portions of Loan and lease related fees and Other income on the accompanying Consolidated Statements of Income. The Company
identifies the performance obligations included in its contracts with customers, determines the transaction price, allocates the transaction price to the performance obligations, as applicable, and recognizes revenue when the performance obligations
are satisfied. Services provided over a period of time are generally transferred to customers evenly over the term of the contracts, and revenue is recognized evenly over the period the services are provided. On the accompanying Consolidated Balance
Sheets, deferred costs to obtain contracts are included in Accrued interest receivable and other assets, and deferred revenue is included in Accrued expenses and other liabilities. Payment terms vary by services offered, and generally the time
between the completion of performance obligations and receipt of payment is not significant. Additional information regarding contracts with customers can be found within Note 21: Revenue from Contracts with Customers.

 Stock-Based Compensation
 The Company maintains a stock
compensation plan that provides for the grant of stock options, stock appreciation rights, restricted stock, performance-based stock, and stock units to employees and directors. Share awards are issued from available treasury shares. Stock
compensation expense is recognized over the required service vesting period for each award based on the grant date fair value, and is included within Compensation and benefits expense on the accompanying Consolidated Statements of Income. For
time-based restricted stock awards and average return on equity performance-based restricted stock awards, fair value is measured using the closing price of Webster common stock at the grant date. For total stockholder return performance-based
restricted stock awards, fair value is measured using the Monte Carlo simulation model. Performance-based restricted stock awards ultimately vest in a range from 0% to 150% of the target number of shares under the grant. Compensation expense may be
subject to adjustment based on management’s assessment of the Company’s average return on equity performance relative to the target number of shares condition. Stock option awards use the Black-Scholes Option-Pricing Model to measure
fair value at the grant date. Forfeiture of stock awards are accounted for as they occur. Excess tax benefits or tax deficiencies result when tax return deductions differ from recognized compensation cost determined using the grant-date fair value
approach for financial statement purposes. Dividends are paid on time-based shares upon grant and are non-forfeitable, while dividends

 17

 are accrued on performance-based awards and are paid with the vested shares when the performance target is
met. Additional information regarding share-based compensation can be found within Note 19: Stock-Based Compensation Plans.
 Income Taxes

 Income tax expense (benefit) is comprised of two components, current and deferred. The current component represents income taxes payable or refundable for the
current period based on applicable tax laws, while the deferred component represents the tax effects of temporary differences between amounts recognized for financial accounting and tax purposes. DTAs and DTLs reflect the tax effects of such
differences that are anticipated to result in taxable or deductible amounts in the future when the temporary differences reverse. DTAs are recognized if it is more likely than not that they will be realized, and may be reduced by a valuation
allowance if it is more likely than not that all or some portion will not be realized.
 Uncertain tax positions that meet a more likely than not recognition
threshold are initially and subsequently measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon settlement with a taxing authority based on knowledge of all relevant information. The determination
of whether or not a tax position meets the more likely than not recognition threshold considers the facts, circumstances, and information available at the reporting date and is subject to management judgment. The Company recognizes interest and
penalties on uncertain tax positions and interest on refundable income taxes as a component of Income tax expense and Other income, respectively, on the accompanying Consolidated Statements of Income. Additional information regarding income taxes
can be found within Note 8: Income Taxes.
 Earnings per Common Share

 Earnings per common share is calculated under the two-class method. Basic earnings per common share is computed by
dividing earnings applicable to common stockholders by the weighted-average number of common shares outstanding, excluding outstanding participating securities, during the pertinent period. Diluted earnings per common share is computed using the
weighted-average number of shares determined for the basic earnings per common share computation plus the dilutive effect of shares resulting from stock compensation and warrants for common stock using the treasury stock method. The identification
of the Company’s participating securities and a reconciliation between the weighted-average common shares used in calculating basic earnings per common share and the weighted-average common shares used in calculating diluted earnings per
common share can be found within Note 15: Earnings Per Common Share.
 Comprehensive Income (Loss)

 Comprehensive income (loss) includes all changes in equity during the period, except those resulting from transactions with stockholders. Comprehensive income
(loss) comprises net income and the after-tax effect changes in the following items: net unrealized gain (loss) on
 available-for-sale securities, net unrealized gain (loss) on derivative instruments, and net actuarial gain (loss) related to defined benefit pension and other
postretirement benefit plans. Comprehensive income (loss) is reported on the accompanying Consolidated Statements of Stockholders’ Equity and the accompanying Consolidated Statements of Comprehensive Income. Income tax effects of these items
are released from Comprehensive income (loss) contemporaneously with the related gross pretax amount. Additional information regarding comprehensive income (loss) can be found within Note 12: Accumulated Other Comprehensive (Loss), Net of Tax.

 Derivative Instruments and Hedging Activities
 Derivatives
are recognized at fair value and are included in Accrued interest receivable and other assets and Accrued expenses and other liabilities, as applicable, on the accompanying Consolidated Balance Sheets. The value of exchange-traded contracts is based
on quoted market prices, whereas non-exchange traded contracts are valued based on dealer quotes, pricing models, discounted cash flow methodologies, or similar techniques in which the determination of fair
value may require management judgment or estimation. Net cash flows from derivative contract assets and liabilities are presented within Operating activities on the accompanying Consolidated Statements of Cash Flows.

 Derivatives Designated in Hedge Relationships. The Company uses derivatives to hedge exposures or to modify interest rate characteristics for
certain balance sheet accounts under its interest rate risk management strategy. The Company designates derivatives in qualifying hedge relationships either as fair value or cash flow hedges for accounting purposes. Derivative financial instruments
receive hedge accounting treatment if they are qualified and are properly designated as a hedge, and remain highly effective in offsetting changes in the fair value or cash flows attributable to the risk being hedged, both at hedge inception and on
an ongoing basis throughout the life of the hedge. Quarterly prospective and retrospective assessments are performed to ensure hedging relationships continue to be highly effective. If a hedge relationship is no longer highly effective, hedge
accounting would be discontinued.

 18

 The change in fair value on a derivative that is designated and qualifies as a fair value hedge, as well as
the offsetting change in fair value on the hedged item attributable to the risk being hedged, is recognized in earnings. The gain or loss on a derivative that is designated and qualifies as a cash flow hedge is initially recorded as a component of
AOCL, and either subsequently reclassified to interest income as hedged interest payments are received or to interest expense as hedged interest payments are made during the same period in which the hedged transaction affects earnings.

 Derivatives Not Designated in Hedge Relationships . The Company also enters into derivative transactions that are not designated in hedge
relationships. Derivative financial instruments not designated in hedge relationships are recorded at fair value with changes in fair value recognized in Other income on the accompanying Consolidated Statements of Income.

 Offsetting Assets and Liabilities . Derivative assets and derivative liabilities with the same counterparty are presented on a net basis in
Accrued interest receivable and other assets or Accrued expenses and other liabilities on the accompanying Consolidated Balance Sheets when master netting agreements are in place. Cash collateral paid or received for
 non-exchange cleared transactions are presented net with the associated derivative assets and derivative liabilities. Securities collateral is not offset. Amounts paid to dealers for initial margin are also
included in Accrued interest receivable and other assets. Additional information regarding derivatives can be found within Note 16: Derivative Financial Instruments.

 Fair Value Measurements
 The Company measures many of its
assets and liabilities on a fair value basis in accordance with ASC Topic 820, Fair Value Measurement. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. Fair value is used to measure certain assets and liabilities on a recurring basis when fair value is the primary basis of accounting, and on a non-recurring basis
when evaluating assets or liabilities for impairment. Additional information regarding the Company’s policies and methodologies used to measure fair value can be found within Note 17: Fair Value Measurements.

 Employee Retirement Benefit Plans
 The Company sponsors
defined contribution postretirement benefit plans that are established under Section 401(k) of the Internal Revenue Code. Expenses to maintain the plans, as well as employer contributions, are charged to Compensation and benefits on the
accompanying Consolidated Statements of Income.
 The Bank had offered a qualified noncontributory defined benefit pension plan and a non-qualified SERP to eligible employees and key executives who met certain age and service requirements, both of which were frozen effective December 31, 2007. The Bank also provides for OPEB to certain
retired employees. In connection with the merger with Sterling, the Company also assumed the benefit obligations of Sterling’s non-qualified SERP and OPEB plans.

 Pension contributions are funded in accordance with the requirements of the Employee Retirement Income Security Act. Net periodic benefit cost (income), which
is based upon actuarial computations of current and future benefits for eligible employees, are charged to Other expense on the accompanying Consolidated Statements of Income. The funded status of the plans is recorded as an asset when over-funded
or a liability when under-funded. Additional information regarding the defined benefit pension and postretirement benefit plans can be found within Note 18: Retirement Benefit Plans.

 Accounting Standards Adopted During the Current Year

 ASU No. 2023-09—Income Taxes (Topic 740): Improvements to Income Tax Disclosures

 In December 2023, the FASB issued ASU No. 2023-09—Income Taxes (Topic 740): Improvements to Income Tax
Disclosures, to provide more transparency about income tax information through improvements to income tax disclosures, primarily related to the rate reconciliation and income taxes paid information. Specifically, the amendments in this Update
require disclosure of: (i) a tabular reconciliation, using both percentages and reporting currency amounts, with prescribed categories that are required to be disclosed, and the separate disclosure and disaggregation of prescribed reconciling
items with an effect equal to 5% or more of the amount determined by multiplying pretax income from continuing operations by the application statutory rate; (ii) a qualitative description of the states and local jurisdictions that make up the
majority (greater than 50%) of the effect of the state and local income taxes; and (iii) amount of income taxes paid, net of refunds received, disaggregated by federal, state, and foreign taxes and by individual jurisdictions that comprise 5%
or more of total income taxes paid, net of refunds received. The amendments in this Update also include certain other amendments to improve the effectiveness of income tax disclosures.

 The Company adopted the Update as of December 31, 2025, on a retrospective basis. Refer to the section captioned “Disaggregation of Income Taxes
Paid” earlier in this Note 1: Summary of Significant Accounting Policies and Note 8: Income Taxes for the incorporation of such additional income tax disclosure information.

 19

 Relevant Accounting Standards Issued But Not Yet Adopted

 ASU No. 2024-03—Income Statement—Reporting Comprehensive Income—Expense Disaggregation
Disclosures
 (Subtopic 220-40): Disaggregation of Income Statement Expenses

 In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive
Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires entities to disclose specified information about certain costs and expenses in the
notes to financial statements at each interim and annual reporting period, including the amounts of (a) purchases of inventory, (b) employee compensation, (c) depreciation, (d) intangible asset amortization, and (e) depletion
included in each relevant expense caption. For the employee compensation category, bank holding companies may continue to present compensation expense on the face of the income statement in accordance with Regulation
 S-X Rule 210.9-04. A qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively are also required
to be disclosed. In addition, entities must disclose the total amount of selling expenses and, in annual reporting periods, their definition of selling expenses.

 The Update is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15,
2027, with early adoption permitted. The amendments may be applied on either a prospective or retrospective basis. The Company is currently evaluating this guidance to determine the impact on its non-interest
expense disclosures; however, the impact is not expected to be material.
 ASU No.
 2025-06—Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the
Accounting for Internal-Use Software
 In September 2025, the FASB issued ASU No. 2025-06—Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the
Accounting for Internal-Use Software, to modernize the accounting framework for internal-use software development. The amendments eliminate the requirement to evaluate
software development stages and instead introduce a principles-based capitalization threshold. Under the new guidance, entities begin capitalizing costs when (i) management authorizes and commits to funding the project, and (ii) it is
probable the project will be completed, and the software will be used to perform its intended function (the “probable-to-complete” threshold).

 The Update is effective for annual periods beginning after December 15, 2027, including interim periods within fiscal years beginning after
December 15, 2027, with early adoption permitted. The amendments may be applied using either a prospective, modified, or retrospective transition approach. The Company is currently evaluating this guidance to determine the impact on its internal-use software costs capitalization policy and financial statement presentation.
 ASU No. 2025-08—Financial Instruments—Credit Losses (Topic 326): Purchased Loans
 In November 2025, the FASB
issued ASU No. 2025-08, Financial Instruments—Credit Losses (Topic 326): Purchased Loans, which expands the gross-up approach under CECL beyond PCD assets to
include certain purchased seasoned loans. Under the amendments, loans (excluding credit cards) acquired without credit deterioration and deemed “seasoned,” as defined in the Update, are considered purchased seasoned loans and accounted
for using the gross-up approach at acquisition. The Update also clarifies that any difference between the unpaid principal balance and the grossed-up basis is a non-credit discount or premium, which is to be accreted or amortized into interest income over the term of the loan.
 The
Update is effective for annual periods beginning after December 15, 2026, including interim periods within those fiscal years, with early adoption permitted. The amendments are to be applied prospectively. The Company is currently evaluating
this guidance to determine the impact on its consolidated financial statements.
 ASU No.
 2025-09—Derivatives and Hedging (Topic 815): Hedge Accounting Improvements
 In November 2025, the FASB
issued ASU No. 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements, which introduces targeted refinements to simplify and expand hedge accounting. The amendments (i) permit
designation of groups of forecasted transactions with similar risk exposure in a cash flow hedge, (ii) provide an optional model for hedging choose-your-rate debt
instruments to maintain continuity when contractual terms allow index or tenor changes, (iii) allow designation of variable price components of forecasted purchases or sales of nonfinancial items, and (iv) remove the presumption that a
derivative instrument that results from combining a written option and any other non-option derivative are automatically a written option. The Update also eliminates presentation mismatches for dual hedge
strategies involving foreign-currency-denominated debt.
 The Update is
effective for annual periods beginning after December 15, 2026, including interim periods within those fiscal years, with early adoption permitted. The amendments are to be applied prospectively. The Company is currently evaluating this
guidance to determine the impact on its consolidated financial statements.

 20

 Note 2: Business Developments

 SecureSave Acquisition
 On December 4, 2025, the
Company acquired SecureSave, a financial technology company that partners with employers to offer employees FDIC-insured emergency savings accounts funded through automatic payroll deductions to help budget for unexpected expenses. The acquisition
provided the Company with a new source of low-cost deposits with potential for growth, access to SecureSave’s existing client partnerships, and enhanced the Company’s financial wellness offerings.

 Prior to the acquisition, the Company had a 17% interest in SecureSave. Upon acquisition, the Company remeasured its previously held equity interest in
SecureSave to its acquisition-date fair value of $8.0 million, and recognized an insignificant loss in Other income on the accompanying Consolidated Statement of Income.

 The total consideration transferred was $34.9 million, which reflects the purchase price for the remaining 83% of the business, and included cash paid at
closing of $26.5 million and contingent consideration with an acquisition-date fair value of $8.4 million. The contingent consideration is payable in cash up to a maximum $35.0 million, based upon the achievement of deposit growth
performance targets at three consecutive annual measurement dates beginning December 31, 2026. Additional information regarding the determination of fair value for contingent consideration liabilities can be found within Note 17: Fair Value
Measurements.
 The acquisition was accounted for as a business combination. The total consideration transferred was preliminarily allocated to
$13.5 million of net identifiable assets acquired, measured at fair value, which primarily comprised a $7.6 million core deposit intangible asset and a $1.9 million non-competition agreement
intangible asset. The associated core deposit intangible asset is being amortized on an accelerated basis over an estimated useful life of 10 years, which represents the period over which the expected economic benefits are anticipated to be
received. The non-competition agreement intangible asset is being amortized on a straight-line basis over an estimated useful life of 3 years. The Company considers its valuations of other intangible assets
and, in turn, the related deferred tax impact, to be provisional at December 31, 2025.
 The $29.5 million of preliminary goodwill recognized,
which represents the future economic benefits arising from acquiring SecureSave primarily due to expected synergies, is not deductible for tax purposes. Information regarding the allocation of goodwill to the Company’s reportable segments can
be found within Note 20: Segment Reporting.
 United Community Bank HSA Portfolio Acquisition

 On November 14, 2025, the Company acquired a portfolio of HSAs from United Community Bank. The transaction was accounted for as an asset acquisition, and
the Company received $10.5 million in both cash and deposits on the acquisition date. The Company also paid an 8% deposit premium based on the final settlement of deposits, which resulted in the recognition of an $0.8 million core deposit
intangible asset. The associated core deposit intangible asset is being amortized over an estimated useful life of 9 years using a 1.5% declining balance approach. This portfolio acquisition reflects a planned change in custody related to the
Company’s acquisition of Bend in 2022. The HSA deposits acquired in the transaction had been previously reflected as assets under administration, which are excluded from the Company’s Consolidated Balance Sheets.

 Elements Financial Federal Credit Union HSA Portfolio Acquisition

 On October 1, 2025, the Company acquired a portfolio of HSAs from Elements Financial Federal Credit Union. The transaction was accounted for as an asset
acquisition, and the Company received $53.9 million in both cash and deposits on the acquisition date. The Company also paid a 12% deposit premium based on $40.9 million of the total deposits settlement, which resulted in the recognition
of a $4.9 million core deposit intangible asset. The associated core deposit intangible asset is being amortized over an estimated useful life of 9 years using a 1.5% declining balance approach. This portfolio acquisition reflects a planned
change in custody related to the Company’s acquisition of Bend in 2022. The HSA deposits acquired in the transaction had been previously reflected as assets under administration, which are excluded from the Company’s Consolidated Balance
Sheets.
 Allegacy Federal Credit Union HSA Portfolio Acquisition

 On August 29, 2025, the Company acquired a portfolio of HSAs from Allegacy Federal Credit Union. The transaction was accounted for as an asset acquisition,
and the Company received $6.2 million in both cash and deposits on the acquisition date. The Company also paid a 12% deposit premium based on the final settlement of deposits, which resulted in the recognition of a $0.7 million core
deposit intangible asset. The associated core deposit intangible asset is being amortized over an estimated useful life of 9 years using a 1.5% declining balance approach. This portfolio acquisition reflects a planned change in custody related to
the Company’s acquisition of Bend in 2022. The HSA deposits acquired in the transaction had been previously reflected as assets under administration, which are excluded from the Company’s Consolidated Balance Sheets.

 21

 Ametros Acquisition

 On January 24, 2024, the Bank acquired all of the equity interest in Ametros from Long Ridge Capital Management (the “Seller”). Ametros is a
custodian and administrator of medical funds from insurance claim settlements that helps individuals manage their ongoing medical care through its CareGuard service and proprietary technology platform. The acquisition provided the Bank with a
fast-growing source of low-cost and long-duration deposits, new sources of non-interest income, and enhanced its employee benefit and healthcare financial services
expertise.
 The acquisition was accounted for as a business combination. Accordingly, the total purchase price, which included cash paid of
$359.7 million, the forgiveness of $12.9 million in long-term debt, and the assumption of a $5.8 million liability for the Seller’s transaction expenses, has been allocated to the identifiable assets acquired and liabilities
assumed based on their acquisition-date fair values, as summarized in the following table:

 (In thousands)

     Fair Value    

 Purchase price consideration

  $
 378,424 

 Assets:

 Cash and due from banks

 310 

 Premises and equipment

 1,078 

 Other intangible assets

 188,900 

 Deferred tax assets, net

 (35,889)

 Other assets:

 Funds held in escrow

 288,167 

 Accounts receivable

 2,435 

 Prepaid expenses

 1,166 

 Total other assets

 291,768 

 Total assets acquired

  $
 446,167 

 Liabilities:

 Interest-bearing deposits (1)

 (20,622)

 Other liabilities:

 Accounts payable

 684 

 Accrued expenses

 4,270 

 Deferred revenue

 20,391 

 Members’ funds

 288,167 

 Operating lease liabilities

  $
 838 

 Total other liabilities

  $
 314,350 

 Total liabilities assumed

  $
 293,728 

 Net assets acquired

 152,439 

 Pre-existing equity interest (2)

 2,200 

 Goodwill

  $
    228,185 

 (1)
 The $20.6 million reflects the amount held in Ametros’ operating cash account at the Bank on
January 24, 2024. Upon acquisition, such cash and the Bank’s corresponding deposit liability owed to Ametros were eliminated in consolidation, which resulted in a decrease to interest-bearing deposits for the Bank and the Bank’s
legal title to the funds being held in such operating cash account.

 (2)
 Prior to the acquisition date, the Company had a 0.6% equity interest in Ametros. The consideration transferred
reflects the purchase price for the remaining 99.4% of the business. Upon acquisition, the Company recognized a $1.5 million gain in Other income on the accompanying Consolidated Statement of Income, which represents the difference between the
cost basis and estimated acquisition-date fair value of the Company’s pre-existing equity interest in Ametros.

 The Company’s valuations of the assets acquired and liabilities assumed in the Ametros acquisition were considered final as of December 31, 2024.
There were no adjustments to fair value estimates recognized during the measurement period. The $228.2 million of goodwill represents future economic benefits arising from acquiring Ametros, primarily due to its strong market position and its
assembled workforce, and is not deductible for tax purposes. Information regarding the allocation of goodwill to the Company’s reportable segments can be found within Note 20: Segment Reporting.

 The Company incurred $3.1 million of professional and outside services expenses related to the acquisition of Ametros during the first quarter of 2024. The
revenue and earnings related to the Ametros business since the acquisition date are included in the Company’s Consolidated Statements of Income for the years ended December 31, 2025, and 2024, and were not material.

 22

 The following is a description of the valuation methodologies used to estimate the fair values of the
significant assets acquired and liabilities assumed:
 Other intangible assets. The Company identified and recognized a $182.8 million
core deposit intangible asset and a $6.1 million trade name intangible asset. A core deposit intangible asset represents the value of relationships with deposit customers. The fair value of the core deposit intangible asset was estimated using
a net cost savings method, a form of discounted cash flow methodology, which gave appropriate consideration to expected client attrition rates and other applicable adjustments to the projected deposit balance, the interest cost and net maintenance
cost associated with the client deposit base, an alternative cost of funds, and a discount rate that was used to discount the future economic benefits of the core deposit intangible asset to present value. The core deposit intangible asset is being
amortized on an accelerated basis over an estimated useful life of 25 years, which is the period over which the estimated economic benefits are estimated to be received. The fair value of the trade name intangible asset for the Ametros brand was
estimated using a relief-from-royalty methodology, which models the cost savings from owning the brand rather than licensing it from a third party. The trade name intangible asset is being amortized on a straight-line basis over an estimated useful
life of 5 years.
 Funds held in escrow and Members’ funds. Funds held in escrow represent amounts held in interest-bearing checking
accounts at insured depository institutions other than the Bank for the purpose of providing post-settlement medical administration services on a respective member’s behalf. Members’ funds is the corresponding liability to the Funds held
in escrow. Given that these amounts can be withdrawn and/or directed for use on demand, as long as in accordance with the terms of the settlement agreement, their carrying amount is a reasonable estimate of fair value.

 Joint Venture with Marathon Asset Management
 On
July 19, 2024, the Company, through its subsidiary, MW Advisor Holding, LLC, entered into an agreement with Marathon Asset Management and formed a private credit joint venture, which is designed to deliver direct lending solutions for
sponsor-backed middle market companies across the country.
 During the year ended December 31, 2025, the Company identified and sold
$247.5 million, in aggregate, of commercial non-mortgage loans comprising the seed portfolio to launch the joint venture’s operations. The transfers each met the requisite criteria to be accounted
for as sales in accordance with ASC 860, Transfers and Servicing. The resulting gain on sale of $2.1 million, in aggregate, was included in Other income on the accompanying Consolidated Statements of Income and in Commercial Banking for segment
reporting purposes. Upon the identification of the loans to be sold, the $1.3 million difference, in aggregate, between the lower of the amortized cost basis of the loans and their fair value was
 charged-off and recognized in the Provision for credit losses on the accompanying Consolidated Statements of Income.

 Multi-family Securitization
 On September 30, 2024, the
Company completed a multi-family securitization, in which it transferred $303.9 million of multi-family loans ($302.5 million carrying amount plus $1.4 million accrued interest receivable) to a third-party depositor, who placed the
multi-family loans into a third-party trust, in exchange for net cash proceeds of $311.6 million. Through a two-step process, pass-through certificates were issued, which are secured by the multi-family
loans and guaranteed by Freddie Mac. The transfer of the multi-family loans was accounted for as a sale in accordance with ASC 860, Transfers and Servicing. Servicing rights were not retained.

 Per the terms of the securitization agreement, the Company assumed an obligation to reimburse Freddie Mac for any payments made under Freddie Mac’s
guarantee of the certificates. The reimbursement obligation covers losses up to 12% of the aggregate UPB of the multi-family loans at the time of sale, and is secured in full by an irrevocable letter of credit issued by the FHLB. Essentially, this
reimbursement obligation represents a first credit loss enhancement provided by the Company to Freddie Mac. Based on the credit quality of the multi-family loans at the time of sale, among other factors, the Company estimated the fair value of its
reimbursement obligation to be $3.3 million. Including the reimbursement obligation, the transaction resulted in a net gain on sale of $4.4 million. The carrying amount of the reimbursement obligation remained at $3.3 million at both
December 31, 2025, and 2024, and is included in Accrued expenses and other liabilities on the Consolidated Balance Sheets. The Company has not yet been required to make any guarantee payments to Freddie Mac.

 Until the Company’s obligation to reimburse Freddie Mac for the first 12% of losses is reduced to 25% of the initial amount, it may have the option to
exercise certain contingent repurchase rights over the transferred multi-family loans, unless it elects to waive or assign those rights. At both the time of sale, and as of December 31, 2025, the Company does not intend to repurchase any of the
multi-family loans.

 23

 Payroll Finance Portfolio and Sale of Factored Receivables Portfolio

 In March 2024, the Company initiated a plan to actively sell its payroll finance and factored receivables loan portfolios, along with the related customer
contracts. This decision was a direct result of the Company’s continuous reassessment of its strategic model in an effort to identify opportunities to improve its core financial products and services. Accordingly, the aggregate
$220.2 million balance of the payroll finance and factored receivables loans, at March 31, 2024, was reclassified and transferred from held for investment to held for sale on the accompanying Consolidated Balance Sheets. Upon the transfer,
the $5.4 million ACL that was previously recorded against the payroll finance and factored receivables loans was reversed into earnings.
 On
September 27, 2024, the Company sold its factored receivables loan portfolio of $124.1 million, and the related customer contracts, for proceeds of $129.2 million. After the write-off of the
factored receivables customer relationship intangible asset, which had a net carrying amount of $19.7 million, less $1.3 million of selling costs, the sale of assets resulted in a $16.0 million net loss on sale. The entire net loss is
included in Other income on the Consolidated Statements of Income and in the Corporate and Reconciling category for segment reporting purposes in accordance with the Company’s methodology.

 In December 2024, after re-evaluating its strategic priorities as part of its annual budgeting and forecasting process,
the Company decided to terminate the plan of sale of its payroll finance portfolio and instead hold the loans as an investment for the foreseeable future. Accordingly, the $133.2 million balance of the payroll finance loans, at
December 31, 2024, was reclassified and transferred from held for sale to held for investment on the accompanying Consolidated Balance Sheets. Upon the transfer, a $0.3 million ACL was re-established
against the payroll finance loans.
 Sale of Mortgage Servicing Rights

 During the year ended December 31, 2023, the Company committed to and initiated a plan to actively market and sell the majority of its mortgage servicing
portfolio. Upon making this determination, the Company treated the related mortgage servicing rights as assets held for disposition and ceased the recognition of any future amortization expense. On February 12, 2024, the Company sold the
majority of its mortgage servicing portfolio, which comprised 9,184 individual residential mortgage loans with an aggregate UPB of $1.4 billion. In connection with the sale, the Company received net cash proceeds of $18.4 million and
derecognized $6.7 million of mortgage servicing rights. The resulting $11.7 million net gain on sale of mortgage servicing rights is included in Other income on the Consolidated Statements of Income and in Consumer Banking for segment
reporting purposes.

 24

 Note 3: Investment Securities

 Available-for-Sale

 The following tables summarize the amortized cost and fair value of
 available-for-sale securities by major type:

 December 31, 2025

 (In thousands)

 Amortized

 Cost (1)

 Gross
Unrealized
Gains

 Gross
Unrealized Losses

 Allowance for Credit
Losses

 Fair Value

 Government agency debentures

  $
 222,848

 $
 —

 $
 (25,198
 )

 $
 —

 $
 197,650 

 Municipal bonds and notes

 116,750

 —

 (7,131
 )

 —

 109,619 

 Agency CMO

 26,816

 —

 (1,960
 )

 —

 24,856 

 Agency MBS

 5,125,433

 80,370

 (148,530
 )

 —

 5,057,273 

 Agency CMBS

 3,855,392

 9,057

 (338,439
 )

 —

 3,526,010 

 CMBS

 717,776

 1,531

 (895
 )

 —

 718,412 

 Corporate debt

 350,996

 584

 (23,435
 )

 —

 328,145 

 Private label MBS

 41,087

 —

 (3,035
 )

 —

 38,052 

 Other

 9,880

 —

 (397
 )

 —

 9,483 

 Total
 available-for-sale

  $
 10,466,978

 $
 91,542

 $
 (549,020
 )

 $
 —

 $
 10,009,500 

 December 31, 2024

 (In thousands)

 Amortized

 Cost (1)

 Gross
Unrealized
Gains

 Gross
Unrealized Losses

  Allowance for Credit 
Losses

 Fair Value

 Government agency debentures

  $
 222,767

 $
 —

 $
 (36,341
 )

 $
 —

 $
 186,426 

 Municipal bonds and notes

 123,885

 2

 (13,011
 )

 —

 110,876 

 Agency CMO

 32,193

 —

 (3,150
 )

 —

 29,043 

 Agency MBS

 4,760,541

 11,654

 (252,410
 )

 —

 4,519,785 

 Agency CMBS

 3,400,021

 84

 (365,713
 )

 —

 3,034,392 

 CMBS

 630,985

 411

 (6,008
 )

 —

 625,388 

 Corporate debt

 496,087

 801

 (43,755
 )

 (867
 )

 452,266 

 Private label MBS

 44,081

 —

 (4,862
 )

 —

 39,219 

 Other

 9,855

 —

 (650
 )

 —

 9,205 

 Total
 available-for-sale

  $
      9,720,415

 $
      12,952

 $
      (725,900
 )

 $
 (867
 )

 $
      9,006,600 

 (1)
 Accrued interest receivable on
 available-for-sale securities of $37.5 million and $35.2 million at December 31, 2025, and 2024, respectively, is excluded from amortized cost and
included in accrued interest receivable and other assets on the accompanying Consolidated Balance Sheets.

 Unrealized Losses

 The following tables summarize the gross unrealized losses and fair value of
 available-for-sale securities by length of time each major security type has been in a continuous unrealized loss position:

 December 31, 2025

 Less Than 12 Months

 12 Months or More

 Total

 (Dollars in thousands)

 Fair Value

 Gross Unrealized
Losses

 Fair Value

 Gross Unrealized
Losses

 Number of
Holdings

 Fair Value

 Gross Unrealized
Losses

 Government agency debentures

  $
 —

 $
 — 

  $
 197,650

 $
 (25,198)

 15

 $
 197,650

 $
 (25,198)

 Municipal bonds and notes

 —

 — 

 108,944

 (7,131)

 36

 108,944

 (7,131)

 Agency CMO

 —

 — 

 24,856

 (1,960)

 25

 24,856

 (1,960)

 Agency MBS

 15,368

 (22)

 1,197,592

 (148,508)

 301

 1,212,960

 (148,530)

 Agency CMBS

 542,126

 (10,939)

 2,395,394

 (327,500)

 184

 2,937,520

 (338,439)

 CMBS

 151,663

 (362)

 72,197

 (533)

 16

 223,860

 (895)

 Corporate debt

 14,948

 (52)

 297,613

 (23,383)

 41

 312,561

 (23,435)

 Private label MBS

 —

 — 

 38,052

 (3,035)

 3

 38,052

 (3,035)

 Other

 4,994

 (6)

 4,489

 (391)

 2

 9,483

 (397)

 Total

  $
    729,099

 $
    (11,381)

  $
    4,336,787

 $
    (537,639)

    623   

 $
    5,065,886

 $
    (549,020)

 25

 December 31, 2024

 Less Than 12 Months

 12 Months or More

 Total

 (Dollars in thousands)

 Fair Value

 Gross Unrealized
Losses

 Fair Value

 Gross Unrealized
Losses

 Number of
Holdings

 Fair Value

 Gross Unrealized
Losses

 Government agency debentures

 $
 — 

 $
 — 

 $
 186,427

 $
 (36,341) 

 15

 $
 186,427

 $
 (36,341) 

 Municipal bonds and notes

 859 

 (1)

 108,013

 (13,010) 

 57

 108,872

 (13,011) 

 Agency CMO

 — 

 — 

 29,043

 (3,150) 

 28

 29,043

 (3,150) 

 Agency MBS

 2,624,722 

 (31,539)

 1,246,818

 (220,871) 

 370

 3,871,540

 (252,410) 

 Agency CMBS

 1,468,615 

 (32,528)

 1,540,263

 (333,185) 

 185

 3,008,878

 (365,713) 

 CMBS

 — 

 — 

 457,423

 (6,008) 

 32

 457,423

 (6,008) 

 Corporate debt

 — 

 — 

 426,805

 (43,755) 

 59

 426,805

 (43,755) 

 Private label MBS

 — 

 — 

 39,219

 (4,862) 

 3

 39,219

 (4,862) 

 Other

 — 

 — 

 9,205

 (650) 

 2

 9,205

 (650) 

 Total

 $
    4,094,196 

 $
    (64,068)

 $
    4,043,216

 $
    (661,832) 

    751   

 $
    8,137,412

 $
    (725,900) 

 The $176.9 million decrease in gross unrealized losses of
 available-for-sale securities from December 31, 2024, to December 31, 2025, is primarily due to lower market interest rates and lower securities’
spreads. The Company assesses each available-for-sale security that is in an unrealized loss position on a quarterly basis to determine whether the decline in fair value
below the amortized cost basis is a result of any credit related factors. There was no ACL recorded on available-for-sale securities at December 31, 2025. At
December 31, 2024, the ACL on available-for-sale securities was $0.9 million, which related to a single Corporate debt security. Each of the Company’s available-for-sale securities in an unrealized loss position at December 31, 2025, is investment grade, current as to principal and interest, and their price changes are
consistent with interest and credit spreads when adjusting for duration, convexity, rating, and industry differences.
 Based on current market conditions
and the Company’s targeted balance sheet composition strategy, the Company intends to hold its available-for-sale securities in unrealized loss positions through
the anticipated recovery period. The issuers of these available-for-sale securities have not, to the Company’s knowledge, established any cause for default. Market
prices are expected to approach par as the securities approach maturity.
 Contractual Maturities

 The following table summarizes the amortized cost and fair value of
 available-for-sale securities by contractual maturity:

 December 31, 2025

 (In thousands)

 Amortized Cost

 Fair Value

 Maturing within 1 year

  $
 12,514

  $
 12,495

 After 1 year through 5 years

 269,131

 265,399

 After 5 years through 10 years

 880,536

 851,880

 After 10 years

 9,304,797

 8,879,726

 Total
 available-for-sale

  $
      10,466,978
  

  $
      10,009,500
  

 Available-for-sale securities that are not due
at a single maturity date have been categorized based on the maturity date of the underlying collateral. Actual principal cash flows may differ from this categorization as borrowers have the right to prepay their obligations with or without
prepayment penalties.
 Sales of Available-for Sale Securities

 The following table summarizes information related to sales of
 available-for-sales securities:

 Years ended December 31,

 (In thousands)

 2025

 2024

 2023

 Proceeds from sales

  $
        14,880

  $
        2,142,462

  $
        789,603

 Gross realized gains

  $
 332

  $
 2,240

  $
 —

 Gross realized losses (1)

 (112
 )

 (141,034
 )

 (37,356
 )

 (1)
 There were no gross losses realized on sale of
 available-for-sale securities due to credit related factors for the year ended December 31, 2025. For the years ended December 31, 2024, and 2023,
respectively, $2.6 million and $3.8 million of the gross losses realized on sale of available-for-sale securities were due to credit related factors and,
therefore, was included in the Provision for credit losses on the accompanying Consolidated Statements of Income. The net amounts presented as a component of non-interest income for the years ended
December 31, 2025, 2024, and 2023, respectively, include the portion of any gross losses that were not due to credit related factors.

 26

 Other Information

 The following table summarizes the carrying value of available-for-sale
securities that are pledged for deposits, borrowings, and other purposes:

 December 31,

 (In thousands)

 2025

 2024

 Pledged for deposits

  $
 1,779,781

  $
 1,596,378

 Pledged for borrowings and other

 7,659,722

 6,863,183

 Total
 available-for-sale securities pledged

  $
      9,439,503
   

  $
      8,459,561
   

 Held-to-Maturity

 The following tables summarizes the amortized cost, fair value, and ACL on
 held-to-maturity securities by major type:

 December 31, 2025

 (In thousands)

 Amortized

 Cost (1)

 Gross Unrealized
Gains

 Gross Unrealized
Losses

 Fair Value

 Allowance for Credit
Losses

 Net Carrying Value 

 Agency CMO

  $
 16,791

 $
 —

 $
 (1,071
 )

 $
 15,720 

  $
       —

 $
 16,791 

 Agency MBS

 2,767,869

 24,073

 (226,089
 )

 2,565,853 

 —

 2,767,869 

 Agency CMBS

 4,295,308

 —

 (567,040
 )

 3,728,268 

 —

 4,295,308 

 Municipal bonds and notes

 824,734

 989

 (30,461
 )

 795,262 

 (97
 )

 824,637 

 CMBS

 64,970

 —

 (1,490
 )

 63,480 

 —

 64,970 

 Total
 held-to-maturity

  $
     7,969,672

 $
      25,062

 $
     (826,151)

 $
     7,168,583 

  $
 (97
 )

 $
 7,969,575 

 December 31, 2024

 (In thousands)

 Amortized

 Cost (1)

 Gross Unrealized
Gains

 Gross Unrealized
Losses

 Fair Value

 Allowance for Credit
Losses

 Net Carrying Value 

 Agency CMO

  $
 19,847

 $
 —

 $
 (1,671
 )

 $
 18,176 

  $
 —

 $
 19,847 

 Agency MBS

 3,109,411

 771

 (333,039
 )

 2,777,143 

 —

 3,109,411 

 Agency CMBS

 4,357,505

 414

 (613,914
 )

 3,744,005 

 —

 4,357,505 

 Municipal bonds and notes

 891,909

 317

 (40,266
 )

 851,960 

 (171
 )

 891,738 

 CMBS

 65,690

 —

 (3,851
 )

 61,839 

 —

 65,690 

 Total
 held-to-maturity

  $
 8,444,362

 $
 1,502

 $
 (992,741
 )

 $
 7,453,123 

  $
 (171
 )

 $
 8,444,191 

 (1)
 Accrued interest receivable on
 held-to-maturity securities of $28.1 million and $30.5 million at December 31, 2025, and 2024, respectively, is excluded from amortized cost and is
included in accrued interest receivable and other assets on the accompanying Consolidated Balance Sheets.

 An ACL on held-to-maturity securities is recorded for certain Municipal bonds and notes to account for expected lifetime credit losses. Agency securities represent obligations issued by
a U.S. government-sponsored enterprise or other federally related entity and are either explicitly or implicitly guaranteed, and therefore, assumed to be zero loss.
 Held-to-maturity securities with gross unrealized losses and no ACL are considered to be high credit quality, and therefore, zero credit loss has been recorded.

 The following table summarizes the activity in the ACL on held-to-maturity
securities:

 Years ended December 31,

 (In thousands)

 2025

 2024

 2023

 Balance, beginning of period

  $
 171

  $
 209

  $
 182

 (Benefit) provision for credit losses

 (74
 ) 

 (38
 ) 

 27
  

 Balance, end of period

  $
         97

  $
        171

  $
       209

 Contractual Maturities

 The following table summarizes the amortized cost and fair value of
 held-to-maturity securities by contractual maturity:

 December 31, 2025

 (In thousands)

 Amortized Cost

 Fair Value

 Maturing within 1 year

  $
 10,463

  $
 10,465

 After 1 year through 5 years

 169,137

 164,773

 After 5 years through 10 years

 273,639

 269,539

 After 10 years

 7,516,433
   

 6,723,806
   

 Total
 held-to-maturity

  $
      7,969,672

  $
      7,168,583

 Held-to-maturity securities that are not due at
a single maturity date have been categorized based on the maturity date of the underlying collateral. Actual principal cash flows may differ from this categorization as borrowers have the right to prepay their obligations with or without prepayment
penalties.

 27

 Credit Quality Information

 The Company monitors the credit quality of held-to-maturity securities through
credit ratings provided by S&P, Moody’s, Fitch Ratings, Inc., Kroll Bond Rating Agency, or DBRS Inc. Credit ratings express opinions about the credit quality of a security and are updated at each quarter end. Investment grade securities
are rated BBB- or higher by S&P, or Baa3 or higher by Moody’s, and are generally considered by the rating agencies and market participants to be of low credit risk. Conversely, securities rated below
investment grade, which are labeled as speculative grade by the rating agencies, are considered to have distinctively higher credit risk than investment grade securities. At December 31, 2025, and 2024, there were no speculative grade held-to-maturity securities. Held-to-maturity securities that are not rated are collateralized
with U.S. Treasury obligations.
 The following tables summarize the amortized cost of
 held-to-maturity securities based on their lowest publicly available credit rating:

 December 31, 2025

 Investment Grade

 (In thousands)

 Aaa

 Aa1

 Aa2

 Aa3

 A1

 A2

 A3

 Not Rated

 Agency CMO

  $
 —

 $
 16,791

 $
 —

 $
 —

 $
 —

 $
 —

 $
 —

  $
 —

 Agency MBS

 —

 2,767,869

 —

 —

 —

 —

 —

 —

 Agency CMBS

 —

 4,295,308

 —

 —

 —

 —

 —

 —

 Municipal bonds and notes

 298,666

 153,187

 234,269

 112,482

 9,539

 4,165

 —…

EX-99.2 · d151630dex992.htm

EX-99.2
 4
 d151630dex992.htm
 EX-99.2

 Exhibit 99.2

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 CONDENSED CONSOLIDATED BALANCE SHEETS

   March 31, 2026  

   December 31, 2025  

 (In thousands, except par value and share
data)

 (Unaudited)

 Assets:

 Cash and due from banks

 $
        353,234

 $
        370,748

 Interest-bearing deposits

 2,506,930

 2,078,777

 Investment securities
 available-for-sale, at fair value (1)

 10,581,263

 10,009,500

 Investment securities
 held-to-maturity, net of allowance for credit losses of $96 and $97 (2)

 7,838,979

 7,969,575

 Loans held for sale (3)

 14,478

 14,886

 Loans and leases

 57,248,542

 56,597,110

 Allowance for credit losses on loans and leases

 (733,434
 )

 (719,411
 )

 Loans and leases, net

 56,515,108

 55,877,699

 Federal Home Loan Bank and Federal Reserve Bank stock

 431,395

 356,411

 Deferred tax assets, net

 186,604

 195,740

 Premises and equipment, net

 428,182

 432,035

 Goodwill

 2,898,463

 2,897,522

 Other intangible assets, net

 299,518

 313,234

 Cash surrender value of life insurance policies

 1,292,770

 1,271,457

 Accrued interest receivable and other assets

 2,237,664

 2,286,079

 Total assets

 $
 85,584,588

 $
 84,073,663

 Liabilities and Stockholders’ Equity:

 Deposits:

 Non-interest-bearing

 $
 9,847,077

 $
 10,082,854

 Interest-bearing

 59,192,639

 58,676,959

 Total deposits

 69,039,716

 68,759,813

 Securities sold under agreements to repurchase

 69,756

 596,738

 Federal Home Loan Bank advances

 4,810,619

 2,980,718

 Long-term debt

 738,312

 739,454

 Accrued expenses and other liabilities

 1,352,536

 1,504,704

 Total liabilities

 76,010,939

 74,581,427

 Stockholders’ equity:

 Preferred stock, $0.01 par value: Authorized — 3,000,000 shares;

 Series F issued and outstanding — 6,000 shares

 145,037

 145,037

 Series G issued and outstanding — 135,000 shares

 138,942

 138,942

 Common stock, $0.01 par value: Authorized — 400,000,000 shares;

 Issued — 182,778,045 shares; Outstanding — 162,048,997
 and 161,216,008 shares

 1,828

 1,828

 Paid-in capital

 6,133,181

 6,183,434

 Retained earnings

 4,655,038

 4,477,744

 Treasury stock, at cost — 20,729,048 and 21,562,037 shares

 (1,069,828
 )

 (1,103,905
 )

 Accumulated other comprehensive (loss), net of tax

 (430,549
 )

 (350,844
 )

 Total stockholders’ equity

 9,573,649

 9,492,236

 Total liabilities and stockholders’ equity

 $
 85,584,588 

 $
 84,073,663

 (1)
 Investment securities
 available-for-sale had an amortized cost basis of $11,141,388 at March 31, 2026, and $10,466,978 at December 31, 2025.

 (2)
 Investment securities
 held-to-maturity had a fair value of $6,962,140 at March 31, 2026, and $7,168,583 at December 31, 2025.

 (3)
 Total loans held for sale includes residential mortgage loans valued under the fair value option of $1,734 at
March 31, 2026, and $2,142 at December 31, 2025.

 See accompanying Notes to Condensed Consolidated Financial Statements.

 1

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

 Three months ended

 March 31,

 (In thousands, except per share data)

 2026

 2025

 Interest Income:

 Interest and fees on loans and leases

 $
    776,610 

 $
    755,117 

 Taxable interest on investment securities

 184,609 

 187,115 

 Non-taxable interest on investment securities

 8,491 

 7,354 

 Loans held for sale

 18 

 15 

 Other interest and dividends

 24,551 

 23,886 

 Total interest income

 994,279 

 973,487 

 Interest Expense:

 Deposits

 316,624 

 326,383 

 Securities sold under agreements to repurchase

 1,062 

 1,676 

 Federal Home Loan Bank advances

 33,860 

 23,589 

 Long-term debt

 8,330 

 9,647 

 Total interest expense

 359,876 

 361,295 

 Net interest income

 634,403 

 612,192 

 Provision for credit losses

 54,000 

 77,500 

 Net interest income after provision for credit losses

 580,403 

 534,692 

 Non-interest Income:

 Deposit service fees

 41,515 

 38,895 

 Loan and lease related fees

 15,414 

 17,621 

 Wealth and investment services

 7,209 

 7,789 

 Cash surrender value of life insurance policies

 8,644 

 7,992 

 Gain on sale of investment securities, net

 — 

 220 

 Other income

 28,681 

 20,089 

 Total non-interest income

 101,463 

 92,606 

 Non-interest Expense:

 Compensation and benefits

 222,906 

 198,645 

 Occupancy

 19,486 

 19,717 

 Technology and equipment

 49,631 

 47,719 

 Intangible assets amortization

 9,186 

 9,237 

 Marketing

 4,699 

 4,027 

 Professional and outside services

 22,542 

 17,226 

 Deposit insurance

 16,300 

 16,345 

 Other expense

 34,359 

 30,728 

 Total non-interest expense

 379,109 

 343,644 

 Income before income taxes

 302,757 

 283,654 

 Income tax expense

 56,526 

 56,737 

 Net income

 246,231 

 226,917 

 Preferred stock dividends

 4,163 

 4,163 

 Income allocated to participating securities

 2,794 

 2,387 

 Net income applicable to common stockholders

 $
 239,274 

 $
 220,367 

 Earnings per Common Share:

 Basic

 $
 1.50 

 $
 1.30 

 Diluted

 1.50 

 1.30 

 See accompanying Notes to Condensed Consolidated Financial Statements.

 2

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)

 Three months ended

 March 31,

 (In thousands)

   2026  

   2025  

 Net income

 $
 246,231 

 $
 226,917 

 Other comprehensive (loss) income, net of tax:

 Investment securities available-for-sale

 (74,615)

 96,581 

 Derivative financial instruments

 (5,132)

 10,124 

 Defined benefit pension and other postretirement benefit plans

 42 

 277 

 Other comprehensive (loss) income, net of tax

 (79,705)

 106,982 

 Comprehensive income

 $
    166,526 

 $
    333,899 

 See accompanying Notes to Condensed Consolidated Financial Statements.

 3

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

 Three months ended March 31, 2026

 (In thousands, except per share data)

 Preferred
Stock

 Common
Stock

 Paid-In
Capital

 Retained
Earnings

 Treasury
Stock,
at cost

 Accumulated Other
Comprehensive
(Loss), Net of Tax

 Total
Stockholders’
Equity

 Balance at December 31, 2025

 $
 283,979

 $
 1,828

 $
 6,183,434

 $
 4,477,744

 $
 (1,103,905
 )

 $
 (350,844
 )

 $
 9,492,236

 Net income

 —

 —

 —

 246,231

 —

 —

 246,231

 Other comprehensive (loss), net of tax

 —

 —

 —

 —

 —

 (79,705
 )

 (79,705
 )

 Common stock dividends and equivalents — $0.40 per
share

 —

 —

 —

 (64,774
 )

 —

 —

 (64,774
 )

 Series F preferred stock dividends — $328.125 per
share

 —

 —

 —

 (1,969
 )

 —

 —

 (1,969
 )

 Series G preferred stock dividends — $16.25 per
share

 —

 —

 —

 (2,194
 )

 —

 —

 (2,194
 )

 Stock-based compensation

 —

 —

 (50,253
 )

 —

 64,255

 —

 14,002

 Common shares acquired from stock compensation plan activity

 —

 —

 —

 —

 (30,178
 )

 —

 (30,178
 )

 Balance at March 31, 2026

 $
  283,979

 $
  1,828

 $
  6,133,181

 $
  4,655,038

 $
  (1,069,828
 )

 $
    (430,549
 )

 $
   9,573,649

 Three months ended March 31, 2025

 (In thousands, except per share data)

 Preferred
Stock

 Common
Stock

 Paid-In
Capital

 Retained
Earnings

 Treasury
Stock,
at cost

 Accumulated Other
Comprehensive
(Loss), Net of Tax

 Total
Stockholders’
Equity

 Balance at December 31, 2024

 $
 283,979

 $
 1,828

 $
 6,181,475

 $
 3,759,158

 $
 (536,843
 )

 $
 (556,383
 )

 $
 9,133,214

 Net income

 —

 —

 —

 226,917

 —

 —

 226,917

 Other comprehensive income, net of tax

 —

 —

 —

 —

 —

 106,982

 106,982

 Common stock dividends and equivalents — $0.40 per
share

 —

 —

 —

 (68,743
 )

 —

 —

 (68,743
 )

 Series F preferred stock dividends — $328.125 per
share

 —

 —

 —

 (1,969
 )

 —

 —

 (1,969
 )

 Series G preferred stock dividends — $16.25 per
share

 —

 —

 —

 (2,194
 )

 —

 —

 (2,194
 )

 Stock-based compensation

 —

 —

 (40,590
 )

 —

 54,601

 —

 14,011

 Common shares acquired from stock compensation plan activity

 —

 —

 —

 —

 (21,782
 )

 —

 (21,782
 )

 Common stock repurchase program (1)

 —

 —

 —

 —

 (182,282
 )

 —

 (182,282
 )

 Balance at March 31, 2025

 $
  283,979

 $
  1,828

 $
  6,140,885

 $
  3,913,169

 $
   (686,306
 )

 $
    (449,401
 )

 $
   9,204,154

 (1)
 Includes an addition to Treasury Stock of $1.3 million for the three months ended March 31, 2025,
which reflects the 1% excise tax on net stock repurchases as imposed by the Inflation Reduction Act of 2022.

 See accompanying Notes to
Condensed Consolidated Financial Statements.

 4

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

    Three months ended March 31,   

 (In thousands)

 2026

 2025

 Operating Activities:

 Net income

  $
 246,231  

  $
 226,917  

 Adjustments to reconcile net income to net cash provided by operating
activities:

 Provision for credit losses

 54,000  

 77,500  

 Deferred income tax expense

 39,317  

 27,636  

 Stock-based compensation

 14,002  

 14,011  

 Depreciation and amortization of property and equipment and intangible
assets

 19,998  

 18,239  

 Net (accretion) and amortization of interest-earning assets and
borrowings

 (33,746) 

 (41,132) 

 Amortization of low-income
housing tax credit investments

 38,353  

 32,061  

 Reduction of ROU lease assets

 7,540  

 7,614  

 Net (gain) on sale of investment securities

 —  

 (220) 

 Originations of loans held for sale

 (6,534) 

 (3,105) 

 Proceeds from sale of loans held for sale

 7,009  

 2,741  

 (Increase) in cash surrender value of life insurance policies

 (8,644) 

 (7,992) 

 (Gain) from life insurance policies

 (1,247) 

 (821) 

 (Gain) on sale of alternative investments

 (1,519) 

 (3,291) 

 Other operating activities, net

 (2,553) 

 (499) 

 Net decrease (increase) in derivative contract assets and
liabilities

 54,085  

 (84,526) 

 Net (increase) in prepaid expenses and other assets

 (17,633) 

 (14,062) 

 Net (decrease) in accrued expenses and other liabilities

 (119,912) 

 (156,181) 

 Net cash provided by operating activities

 288,747  

 94,890  

 Investing Activities:

 Purchases of available-for-sale investment securities

 (954,225) 

 (552,655) 

 Proceeds from principal payments, maturities, and calls of available-for-sale investment securities

 292,308  

 331,818  

 Proceeds from sale of available-for-sale investment securities

 —  

 14,880  

 Proceeds from principal payments, maturities, and calls of held-to-maturity investment securities

 141,176  

 162,036  

 Net (increase) in Federal Home Loan Bank and Federal Reserve Bank
stock

 (74,984) 

 (29,359) 

 Alternative investments (capital calls), net of returns of
capital

 (78,076) 

 (56,677) 

 Proceeds from sales of alternative investments

 3,671  

 4,970  

 Net (increase) in loans

 (699,630) 

 (653,556) 

 Proceeds from sale of loans not originated for sale

 16,806  

 38,877  

 Proceeds from sale of foreclosed properties and repossessed
assets

 1,262  

 181  

 Proceeds from sale of property and equipment

 1,317  

 1,428  

 Purchases of property and equipment

 (10,474) 

 (8,311) 

 Proceeds from life insurance policies

 4,007  

 8,004  

 Payments for premiums on life insurance policies

 (3,040) 

 —  

 Net cash (used for) investing activities

 (1,359,882) 

 (738,364) 

 Financing Activities:

 Net increase in deposits

 277,690  

 817,663  

 Net increase in Federal Home Loan Bank advances

 1,829,901  

 799,903  

 Net (decrease) in securities sold under agreements to
repurchase

 (526,982) 

 (260,773) 

 Dividends paid to common stockholders

 (64,494) 

 (68,545) 

 Dividends paid to preferred stockholders

 (4,163) 

 (4,163) 

 Common stock repurchase program

 —  

 (180,987) 

 Common shares acquired related to stock compensation plan
activity

 (30,178) 

 (21,782) 

 Net cash provided by financing activities

 1,481,774  

 1,081,316  

 Net increase in cash and cash equivalents

 410,639  

 437,842  

 Cash and cash equivalents, beginning of period

 2,449,525  

 2,074,434  

 Cash and cash equivalents, end of period

  $
 2,860,164  

  $
 2,512,276  

 See accompanying Notes to Condensed Consolidated Financial Statements.

 5

 WEBSTER FINANCIAL CORPORATION AND SUBSIDIARIES

 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

 Note 1: Basis of Presentation and Accounting Standards Updates

 Basis of Presentation
 The unaudited Condensed Consolidated
Financial Statements of the Company have been prepared in accordance with GAAP for interim financial information and Article 10 of Regulation S-X. Certain information and footnote disclosures required by GAAP
for complete financial statements have been omitted or condensed. Therefore, the Condensed Consolidated Financial Statements should be read in conjunction with the Company’s Annual Report on Form 10-K
for the year ended December 31, 2025. The Company’s financial condition, results of operations, and cash flows for the three months ended March 31, 2026, are not necessarily indicative of the future results that may be attained for
the entire year or other interim periods.
 In the opinion of management, all necessary adjustments have been reflected to present fairly the financial
condition, results of operations, and cash flows for the reporting periods presented. Intercompany transactions and balances have been eliminated in consolidation. Assets under administration or assets under management that the Company holds or
manages in a fiduciary or agency capacity for customers are not included in the accompanying Condensed Consolidated Balance Sheets.
 Use of Estimates

 The preparation of the Condensed Consolidated Financial Statements in accordance with GAAP requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the Condensed Consolidated Financial Statements, and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
 Significant Accounting Policies

 The Company’s significant accounting policies are described in Note 1: Summary of Significant Accounting Policies in the Notes to Consolidated Financial
Statements contained in Part II - Item 8. Financial Statements and Supplementary Data of the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. There have been no changes to
those accounting policies during the three months ended March 31, 2026.
 Supplemental Cash Flow Information

 The following table summarizes supplemental disclosures of cash flow information and non-cash investing and financing
activities:

    Three months ended March 31,   

 (In thousands)

 2026

 2025

 Supplemental disclosure of cash flow information:

 Interest paid

  $
 366,212 

  $
 393,822 

 Income taxes paid, net of refunds received

 5,606 

 3,790 

 Non-cash investing and
financing activities:

 Transfer of loans held for investment to foreclosed properties and
repossessed assets

  $
 2,937 

  $
 310 

 Transfer of returned finance lease equipment to assets held for
sale

 799 

 727 

 Transfer of loans held for investment to loans held for sale

 16,806 

 59,948 

 ROU lease assets obtained in exchange for operating lease
liabilities

 653 

 24,261 

 Approved commitments to fund LIHTC investments

 27,087 

 70,753 

 Business combinations:
 (1)

 Deferred tax assets, net

  $
 302 

  $
 — 

 Goodwill

 941 

 — 

 Other intangible assets

 (1,120)

 — 

 Other assets

 (123)

 — 

 (1)
 The non-cash business combination activities reflect the effects of the
measurement-period adjustments recorded during the first quarter of 2026 related to the acquisition of SecureSave in December 2025. Additional information regarding the SecureSave acquisition can be found within Note 2: Business Developments.

 6

 Relevant Accounting Standards Issued But Not Yet Adopted

 ASU No. 2024-03—Income Statement—Reporting Comprehensive Income—Expense Disaggregation
Disclosures
 (Subtopic 220-40): Disaggregation of Income Statement Expenses

 In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive
Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires entities to disclose specified information about certain costs and expenses in the
notes to financial statements at each interim and annual reporting period, including the amounts of (a) purchases of inventory, (b) employee compensation, (c) depreciation, (d) intangible asset amortization, and (e) depletion
included in each relevant expense caption. For the employee compensation category, bank holding companies may continue to present compensation expense on the face of the income statement in accordance with Regulation
 S-X Rule 210.9-04. A qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively are also required
to be disclosed. In addition, entities must disclose the total amount of selling expenses and, in annual reporting periods, their definition of selling expenses.

 The Update is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15,
2027, with early adoption permitted. The amendments may be applied on either a prospective or retrospective basis. The Company is currently evaluating this guidance to determine the impact on its non-interest
expense disclosures; however, the impact is not expected to be material.
 ASU No.
 2025-06—Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the
Accounting for Internal-Use Software
 In September 2025, the FASB issued ASU No. 2025-06—Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the
Accounting for Internal-Use Software, to modernize the accounting framework for internal-use software development. The amendments eliminate the requirement to evaluate
software development stages and instead introduce a principles-based capitalization threshold. Under the new guidance, entities begin capitalizing costs when (i) management authorizes and commits to funding the project, and (ii) it is
probable the project will be completed, and the software will be used to perform its intended function (the “probable-to-complete” threshold).

 The Update is effective for annual periods beginning after December 15, 2027, including interim periods within fiscal years beginning after
December 15, 2027, with early adoption permitted. The amendments may be applied using either a prospective, modified, or retrospective transition approach. The Company is currently evaluating this guidance to determine the impact on its internal-use software costs capitalization policy and financial statement presentation.
 ASU No. 2025-08—Financial Instruments—Credit Losses (Topic 326): Purchased Loans
 In November 2025, the FASB
issued ASU No. 2025-08, Financial Instruments—Credit Losses (Topic 326): Purchased Loans, which expands the gross-up approach under CECL beyond purchased
credit-deteriorated assets to include certain purchased seasoned loans. Under the amendments, loans (excluding credit cards) acquired without credit deterioration and deemed “seasoned,” as defined in the Update, are considered purchased
seasoned loans and accounted for using the gross-up approach at acquisition. The Update also clarifies that any difference between the unpaid principal balance and the
 grossed-up basis is a non-credit discount or premium, which is to be accreted or amortized into interest income over the term of the loan.

 The Update is effective for annual periods beginning after December 15, 2026, including interim periods within those fiscal years, with early adoption
permitted. The amendments are to be applied prospectively. The Company is currently evaluating this guidance to determine the impact on its consolidated financial statements.

 ASU No. 2025-09—Derivatives and Hedging (Topic 815): Hedge Accounting Improvements

 In November 2025, the FASB issued ASU No. 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting
Improvements, which introduces targeted refinements to simplify and expand hedge accounting. The amendments (i) permit designation of groups of forecasted transactions with similar risk exposure in a cash flow hedge, (ii) provide an
optional model for hedging choose-your-rate debt instruments to maintain continuity when contractual terms allow index or tenor changes, (iii) allow designation of
variable price components of forecasted purchases or sales of nonfinancial items, and (iv) remove the presumption that a derivative instrument that results from combining a written option and any other
 non-option derivative are automatically a written option. The Update also eliminates presentation mismatches for dual hedge strategies involving
 foreign-currency-denominated debt.
 The Update is effective for annual
periods beginning after December 15, 2026, including interim periods within those fiscal years, with early adoption permitted. The amendments are to be applied prospectively. The Company is currently evaluating this guidance to determine the
impact on its consolidated financial statements.

 7

 Note 2: Business Developments

 Proposed Transaction with Banco Santander
 On
February 3, 2026, Webster entered into a Transaction Agreement with Banco Santander and Webster Virginia Corporation, a wholly owned subsidiary of Webster incorporated in the State of Virginia. The Transaction Agreement provides that, upon the
terms and subject to the conditions set forth therein, Banco Santander will acquire Webster in two steps. First, Webster will merge with and into Webster Virginia Corporation, with Webster Virginia Corporation continuing as the surviving corporation
in such merger. Second, immediately following the completion of such merger, Banco Santander will acquire all outstanding shares of Webster Virginia Corporation through a statutory share exchange.

 Based on Banco Santander’s closing stock price on February 2, 2026, the Transaction has an aggregate value of approximately $12.3 billion. Under
the terms of the Transaction Agreement, holders of Webster common stock will receive $48.75 in cash and 2.0548 ADSs for each share of Webster common stock that they own. Holders of Webster common stock will have the option to exchange ADSs received
in connection with the Transaction for Ordinary Shares at no charge for a specified period following the completion of the Transaction.
 The Transaction
Agreement contains customary representations and warranties, covenants, and closing conditions. As of the date of this Quarterly Report on Form 10-Q, completion of the Transaction remains subject to approval
by the Federal Reserve and the European Central Bank, approval by Webster’s stockholders, and other customary closing conditions.
 In connection with
the Transaction, the Company incurred $9.1 million of acquisition-related expenses during the three months ended March 31, 2026, comprising $0.5 million in Compensation and benefits, $8.5 million in Professional and outside
services, and $0.1 million in Other expense.
 SecureSave Acquisition

 On December 4, 2025, the Company acquired SecureSave, a financial technology company that partners with employers to offer employees FDIC-insured emergency
savings accounts funded through automatic payroll deductions to help budget for unexpected expenses. Additional information regarding the SecureSave acquisition, including the total consideration transferred, the net identifiable assets acquired,
and the preliminary goodwill recognized as of the acquisition date, can be found within Note 2: Business Developments in the Notes to Consolidated Financial Statements contained in Part II – Item 8. Financial Statements and Supplementary Data
of the Company’s Form 10-K for the year ended December 31, 2025.
 During the three months ended
March 31, 2026, the Company recorded a net measurement-period adjustment of $0.9 million, which impacted the identified non-competition agreement intangible assets, their related deferred tax
liabilities, and other assets. Additional information regarding this measurement-period adjustment can be found within Note 5: Goodwill and Other Intangible Assets. The Company’s valuations of the net identifiable assets acquired as part of
the SecureSave acquisition were considered final at March 31, 2026. The $30.4 million of goodwill recognized has been allocated to the Healthcare Financial Services reportable segment.

 8

 Note 3: Investment Securities

 Available-for-Sale

 The following tables summarize the amortized cost and fair value of
 available-for-sale securities by major type:

 March 31, 2026

 (In thousands)

 Amortized

 Cost (1)

 Gross Unrealized
Gains

 Gross Unrealized
Losses

 Fair Value

  

 Government agency debentures

  $
 222,869

 $
 —

 $
 (26,782
 )

 $
 196,087 

 Agency CMO

 25,675

 —

 (2,112
 )

 23,563 

 Agency MBS

 5,487,638

 44,262

 (164,280
 )

 5,367,620 

 Agency CMBS

 4,053,383

 6,267

 (379,200
 )

 3,680,450 

 Municipal bonds and notes

 116,552

 1

 (9,344
 )

 107,209  

 CMBS

 857,992

 996

 (701
 )

 858,287 

 Corporate debt

 326,799

 417

 (25,855
 )

 301,361 

 Private label MBS

 40,593

 —

 (3,407
 )

 37,186 

 Other

 9,887

 —

 (387
 )

 9,500 

 Total
 available-for-sale

  $
   11,141,388

 $
   51,943

 $
 (612,068
 )

 $
   10,581,263 

 December 31, 2025

 (In thousands)

 Amortized

 Cost (1)

 Gross Unrealized
Gains

 Gross Unrealized
Losses

 Fair Value

 Government agency debentures

  $
 222,848

 $
 —

 $
 (25,198
 )

 $
 197,650 

 Agency CMO

 26,816

 —

 (1,960
 )

 24,856 

 Agency MBS

 5,125,433

 80,370

 (148,530
 )

 5,057,273 

 Agency CMBS

 3,855,392

 9,057

 (338,439
 )

 3,526,010 

 Municipal bonds and notes

 116,750

 —

 (7,131
 )

 109,619 

 CMBS

 717,776

 1,531

 (895
 )

 718,412 

 Corporate debt

 350,996

 584

 (23,435
 )

 328,145 

 Private label MBS

 41,087

 —

 (3,035
 )

 38,052 

 Other

 9,880

 —

 (397
 )

 9,483 

 Total
 available-for-sale

  $
   10,466,978

 $
   91,542

 $
 (549,020
 )

 $
   10,009,500 

 (1)
 Accrued interest receivable on
 available-for-sale securities of $40.0 million at March 31, 2026, and $37.5 million at December 31, 2025, is excluded from amortized cost and
included in Accrued interest receivable and other assets on the accompanying Condensed Consolidated Balance Sheets.

 Unrealized
Losses
 The following tables summarize the gross unrealized losses and fair value of
 available-for-sale securities by length of time each major security type has been in a continuous unrealized loss position:

 March 31, 2026

 Less Than 12 Months

 12 Months or More

 Total

 (Dollars in thousands)

 Fair
Value

 Gross Unrealized
Losses

 Fair
Value

 Gross Unrealized
Losses

 Number of
Holdings

 Fair
Value

 Gross Unrealized 

 Losses

 Government agency debentures

  $
 14,710

 $
 (170) 

  $
 181,377

 $
 (26,612) 

 15

 $
 196,087

 $
 (26,782) 

 Agency CMO

 —

 —  

 23,563

 (2,112) 

 25

 23,563

 (2,112) 

 Agency MBS

 1,283,650

 (11,120) 

 1,160,727

 (153,160) 

 341

 2,444,377

 (164,280) 

 Agency CMBS

 759,859

 (23,030) 

 2,335,145

 (356,170) 

 197

 3,095,004

 (379,200) 

 Municipal bonds and notes

 7,477

 (313) 

 98,770

 (9,031) 

 34

 106,247

 (9,344) 

 CMBS

 235,037

 (356) 

 68,363

 (345) 

 19

 303,400

 (701) 

 Corporate debt

 9,960

 (46) 

 277,482

 (25,809) 

 38

 287,442

 (25,855) 

 Private label MBS

 —

 —  

 37,186

 (3,407) 

 3

 37,186

 (3,407) 

 Other

 4,991

 (9) 

 4,509

 (378) 

 2

 9,500

 (387) 

 Total

  $
    2,315,684

 $
 (35,044) 

 $
    4,187,122

 $
   (577,024) 

   674  

 $
    6,502,806

 $
 (612,068) 

 9

 December 31, 2025

 Less Than 12 Months

 12 Months or More

 Total

 (Dollars in thousands)

 Fair
Value

 Gross Unrealized
Losses

 Fair
Value

 Gross Unrealized
Losses

 Number of
Holdings

 Fair
Value

 Gross Unrealized
Losses

 Government agency debentures

  $
 —

 $
 —  

 $
 197,650

 $
 (25,198) 

 15

 $
 197,650

 $
 (25,198) 

 Agency CMO

 —

 —  

 24,856

 (1,960) 

 25

 24,856

 (1,960) 

 Agency MBS

 15,368

 (22) 

 1,197,592

 (148,508) 

 301

 1,212,960

 (148,530) 

 Agency CMBS

 542,126

 (10,939) 

 2,395,394

 (327,500) 

 184

 2,937,520

 (338,439) 

 Municipal bonds and notes

 —

 —  

 108,944

 (7,131) 

 36

 108,944

 (7,131) 

 CMBS

 151,663

 (362) 

 72,197

 (533) 

 16

 223,860

 (895) 

 Corporate debt

 14,948

 (52) 

 297,613

 (23,383) 

 41

 312,561

 (23,435) 

 Private label MBS

 —

 —  

 38,052

 (3,035) 

 3

 38,052

 (3,035) 

 Other

 4,994

 (6) 

 4,489

 (391) 

 2

 9,483

 (397) 

 Total

  $
   729,099

 $
   (11,381) 

 $
   4,336,787

 $
   (537,639) 

   623  

 $
   5,065,886

 $
   (549,020) 

 The $63.0 million increase in gross unrealized losses of
 available-for-sale securities from December 31, 2025, to March 31, 2026, was primarily due to higher market interest rates and wider securities spreads. The
Company assesses each available-for-sale security that is in an unrealized loss position on a quarterly basis to determine whether the decline in fair value below the
amortized cost basis is a result of any credit related factors. There was no ACL recorded on available-for-sale securities at March 31, 2026, and at
December 31, 2025. Each of the Company’s available-for-sale securities in an unrealized loss position at March 31, 2026, is investment grade, current as
to principal and interest, and has had price changes that are consistent with interest and credit spreads when adjusting for duration, convexity, rating, and industry differences.

 Based on current market conditions and the Company’s targeted balance sheet composition strategy, the Company intends to hold its available-for-sale securities in unrealized loss positions through the anticipated recovery period. The issuers of these available-for-sale securities have not, to the Company’s knowledge, established any cause for default. Market prices are expected to approach par as the securities approach maturity.

 Contractual Maturities
 The following table
summarizes the amortized cost and fair value of available-for-sale securities by contractual maturity:

 March 31, 2026

 (In thousands)

 Amortized Cost

 Fair Value

 Maturing within 1 year

 $
 8,581 

 $
 8,565 

 After 1 year through 5 years

 278,455 

 271,735 

 After 5 years through 10 years

 993,644 

 949,655 

 After 10 years

 9,860,708 

 9,351,308 

 Total
 available-for-sale

 $
    11,141,388 

 $
    10,581,263 

 Available-for-sale securities that are not due
at a single maturity date have been categorized based on the maturity date of the underlying collateral. Actual principal cash flows may differ from this categorization as borrowers have the right to prepay their obligations with or without
prepayment penalties.
 Sales of Available-for Sale Securities

 The following table summarizes information related to sales of
 available-for-sales securities:

 Three months ended March 31,

 (In thousands)

 2026

 2025

 Proceeds from sales

 $
       — 

 $
     14,880  

 Gross realized gains

 $
 — 

 $
 332  

 Gross realized losses

 — 

 (112) 

 10

 Other Information

 The following table summarizes the carrying value of available-for-sale
securities that are pledged for deposits, borrowings, and other purposes:

 (In thousands)

 March 31, 2026

 December 31, 2025

 Pledged for deposits

 $
 2,394,014

 $
 1,779,781

 Pledged for borrowing capacity, repurchase agreements, and other

 7,398,688

 7,659,722

 Total
 available-for-sale securities pledged

 $
     9,792,702

 $
     9,439,503

 Held-to-Maturity

 The following tables summarize the amortized cost, fair value, and ACL on
 held-to-maturity securities by major type:

 March 31, 2026

 (In thousands)

 Amortized

 Cost (1)

 Gross Unrealized
Gains

 Gross Unrealized
Losses

 Fair Value

 Allowance for Credit
Losses

 Net Carrying Value

 Agency CMO

 $
 15,818

 $
 —

 $
 (1,125
 )

 $
 14,693 

 $
 —

 $
 15,818 

 Agency MBS

 2,670,159

 14,485

 (234,529
 )

 2,450,115 

 —

 2,670,159 

 Agency CMBS

 4,277,053

 —

 (613,371
 )

 3,663,682 

 —

 4,277,053 

 Municipal bonds and notes

 812,923

 300

 (41,301
 )

 771,922 

 (96
 )

 812,827 

 CMBS

 63,122

 —

 (1,394
 )

 61,728 

 —

 63,122 

 Total
 held-to-maturity

 $
    7,839,075

 $
    14,785

 $
    (891,720
 )

 $
    6,962,140 

 $
     (96
 )

 $
    7,838,979 

 December 31, 2025

 (In thousands)

 Amortized

 Cost (1)

 Gross Unrealized
Gains

 Gross Unrealized
Losses

 Fair Value

 Allowance for Credit
Losses

 Net Carrying Value

 Agency CMO

 $
 16,791

 $
 —

 $
 (1,071
 )

 $
 15,720 

 $
 —

 $
 16,791 

 Agency MBS

 2,767,869

 24,073

 (226,089
 )

 2,565,853 

 —

 2,767,869 

 Agency CMBS

 4,295,308

 —

 (567,040
 )

 3,728,268 

 —

 4,295,308 

 Municipal bonds and notes

 824,734

 989

 (30,461
 )

 795,262 

 (97
 )

 824,637 

 CMBS

 64,970

 —

 (1,490
 )

 63,480 

 —

 64,970 

 Total
 held-to-maturity

 $
    7,969,672

 $
    25,062

 $
    (826,151
 )

 $
    7,168,583 

 $
     (97
 )

 $
    7,969,575 

 (1)
 Accrued interest receivable on
 held-to-maturity securities of $23.6 million at March 31, 2026, and $28.1 million at December 31, 2025, is excluded from amortized cost and included
in Accrued interest receivable and other assets on the accompanying Condensed Consolidated Balance Sheets.

 An ACL on held-to-maturity securities is recorded for certain Municipal bonds and notes to account for expected lifetime credit losses. Agency securities represent obligations issued by
a U.S. government-sponsored enterprise or other federally related entity and are either explicitly or implicitly guaranteed and, therefore, assumed to be zero loss.
 Held-to-maturity securities with gross unrealized losses and no ACL are considered to be high credit quality and, therefore, zero credit loss has been recorded.

 The following table summarizes the activity in the ACL on held-to-maturity
securities:

 Three months ended March 31,

 (In thousands)

 2026

 2025

 Balance, beginning of period

 $
 97 

 $
 171 

 (Benefit) for credit losses

 (1)

 (62)

 Balance, end of period

 $
        96 

 $
       109 

 Contractual Maturities

 The following table summarizes the amortized cost and fair value of
 held-to-maturity securities by contractual maturity:

 March 31, 2026

 (In thousands)

 Amortized Cost

 Fair Value

 Maturing within 1 year

 $
 16,662 

 $
 16,674 

 After 1 year through 5 years

 169,004 

 164,252 

 After 5 years through 10 years

 261,077 

 253,555 

 After 10 years

 7,392,332 

 6,527,659 

 Total
 held-to-maturity

 $
    7,839,075 

 $
    6,962,140 

 Held-to-maturity securities that are not due at
a single maturity date have been categorized based on the maturity date of the underlying collateral. Actual principal cash flows may differ from this categorization as borrowers have the right to prepay their obligations with or without prepayment
penalties.

 11

 Credit Quality Information

 The Company monitors the credit quality of held-to-maturity securities through
credit ratings provided by S&P, Moody’s, Fitch Ratings, Inc., Kroll Bond Rating Agency, or DBRS Inc. Credit ratings express opinions about the credit quality of a security and are updated on a quarterly basis. Investment grade securities
are rated BBB- or higher by S&P, or Baa3 or higher by Moody’s, and are generally considered by both the rating agencies and market participants to be of low credit risk. Conversely, securities rated
below investment grade, which are labeled as speculative grade by the rating agencies, are considered to have distinctively higher credit risk than investment grade securities. The Company did not hold any speculative grade held-to-maturity securities at March 31, 2026, and at December 31, 2025.
 Held-to-maturity securities that are not rated are collateralized with U.S. Treasury obligations.

 The following tables summarize the amortized cost of held-to-maturity securities
based on their lowest publicly available credit rating:

 March 31, 2026

 Investment Grade

 (In thousands)

 Aaa

 Aa1

 Aa2

 Aa3

 A1

 A2

 Not Rated

 Agency CMO

  $
 —

 $
 15,818

 $
 —

 $
 —

 $
 —

 $
 — 

 $
 —
  

 Agency MBS

 —

 2,670,159

 —

 —

 —

 — 

 —

 Agency CMBS

 —

 4,277,053

 —

 —

 —

 — 

 —

 Municipal bonds and notes

 293,061

 147,552

 233,975

 98,270

 23,484

 4,165 

 12,416

 CMBS

 63,122

 —

 —

 —

 —

 — 

 —

 Total
 held-to-maturity

  $
    356,183

 $
    7,110,582

 $
    233,975

 $
     98,270

 $
    23,484

 $
     4,165 

 $
    12,416

 December 31, 2025

 Investment Grade

 (In thousands)

 Aaa

 Aa1

 Aa2

 Aa3

 A1

 A2

 Not Rated

 Agency CMO

  $
 —

 $
 16,791

 $
 —

 $
 —

 $
 —

 $
 — 

 $
 —
  

 Agency MBS

 —

 2,767,869

 —

 —

 —

 — 

 —

 Agency CMBS

 —

 4,295,308

 —

 —

 —

 — 

 —

 Municipal bonds and notes

 298,666

 153,187

 234,269

 112,482

 9,539

 4,165 

 12,426

 CMBS

 64,970

 —

 —

 —

 —

 — 

 —

 Total
 held-to-maturity

  $
    363,636

 $
    7,233,155

 $
    234,269

 $
    112,482

 $
     9,539

 $
     4,165 

 $
    12,426

 There were no held-to-maturity securities past
due under the terms of their agreements or in non-accrual status at March 31, 2026, and at December 31, 2025.

 Other Information
 The following table summarizes the
carrying value of held-to-maturity securities that are pledged for deposits, borrowings, and other purposes:

 (In thousands)

 March 31, 2026

 December 31, 2025

 Pledged for deposits

 $
 1,988,281 

 $
 1,926,373
  

 Pledged for borrowing capacity, repurchase agreements, and other

 5,783,470 

 5,934,352

 Total
 held-to-maturity securities pledged

 $
      7,771,751 

 $
      7,860,725

 12

 Note 4: Loans and Leases

 The following table summarizes loans and leases by portfolio segment and class:

 (In thousands)

 March 31,
2026

 December 31, 2025

 Commercial non-mortgage

 $
 20,915,252 

 $
 20,405,237 

 Asset-based

 1,118,988 

 1,231,231 

 Commercial real estate

 15,234,864 

 15,326,007 

 Multi-family

 7,334,216 

 7,008,839 

 Equipment financing

 1,254,131 

 1,258,882 

 Commercial portfolio

 45,857,451 

 45,230,196 

 Residential

 9,600,026 

 9,599,577 

 Home equity

 1,345,757 

 1,370,513 

 Other consumer

 445,308 

 396,824 

 Consumer portfolio

 11,391,091 

 11,366,914 

 Loans and leases

 $
     57,248,542 

 $
    56,597,110 

 The carrying amount of loans and leases includes net unamortized (discounts)/premiums and net unamortized deferred (fees)/costs,
in aggregate, of $20.0 million at March 31, 2026, and $16.3 million at December 31, 2025. Accrued interest receivable of $285.6 million at March 31, 2026, and $282.5 million at December 31, 2025, is excluded
from the carrying amount of loans and leases and included in Accrued interest receivable and other assets on the accompanying Condensed Consolidated Balance Sheets.

 The Company had pledged eligible loans as collateral of $18.6 billion at March 31, 2026, and $17.2 billion at December 31, 2025, to support
borrowing capacity at the FHLB of Boston, and $6.4 billion at March 31, 2026, and $7.2 billion at December 31, 2025, to support borrowing capacity at the FRB of New York.

 Non-Accrual and Past Due Loans and Leases

 The following tables summarize the aging of accrual and non-accrual loans and leases by class:

 March 31, 2026

 (In thousands)

 30-59 Days
Past Due and
Accruing

 60-89 Days
Past Due and
Accruing

 90 or More Days
Past Due
and Accruing

 Non-accrual

 Total Past Due and
 Non-accrual

 Current

 Total Loans
and Leases

 Commercial non-mortgage

 $
 19,881

 $
 2,534

 $
 —

 $
 184,985

 $
 207,400

 $
 20,707,852

 $
 20,915,252 

 Asset-based

 —

 —

 —

 60,432

 60,432

 1,058,556

 1,118,988 

 Commercial real estate

 76,146

 1,021

 —

 193,949

 271,116

 14,963,748

 15,234,864 

 Multi-family

 8,540

 3,258

 —

 36,863

 48,661

 7,285,555

 7,334,216 

 Equipment financing

 2,798

 1,631

 5

 8,763

 13,197

 1,240,934

 1,254,131 

 Commercial portfolio

 107,365

 8,444

 5

 484,992

 600,806

 45,256,645

 45,857,451 

 Residential

 15,410

 6,515

 —

 20,490

 42,415

 9,557,611

 9,600,026 

 Home equity

 6,941

 1,844

 —

 16,031

 24,816

 1,320,941

 1,345,757 

 Other consumer

 1,095

 1,269

 4

 1,049

 3,417

 441,891

 445,308 

 Consumer portfolio

 23,446

 9,628

 4

 37,570

 70,648

 11,320,443

 11,391,091 

 Total

 $
    130,811

 $
    18,072

 $
      9

 $
    522,562

 $
    671,454

 $
    56,577,088

 $
    57,248,542 

 December 31, 2025

 (In thousands)

 30-59 Days
Past Due and
Accruing

 60-89 Days
Past Due and
Accruing

 90 or More Days
Past Due
and Accruing

 Non-accrual

 Total Past Due and
 Non-accrual

 Current

 Total Loans
and Leases

 Commercial non-mortgage

 $
 12,397

 $
 1,547

 $
 —

 $
 165,378

 $
 179,322

 $
 20,225,915

 $
 20,405,237 

 Asset-based

 —

 —

 —

 66,844

 66,844

 1,164,387

 1,231,231 

 Commercial real estate

 23,702

 838

 —

 182,968

 207,508

 15,118,499

 15,326,007 

 Multi-family

 476

 —

 —

 41,095

 41,571

 6,967,268

 7,008,839 

 Equipment financing

 2,279

 256

 —

 8,340

 10,875

 1,248,007

 1,258,882 

 Commercial portfolio

 38,854

 2,641

 —

 464,625

 506,120

 44,724,076

 45,230,196 

 Residential

 12,163

 3,074

 —

 18,187

 33,424

 9,566,153

 9,599,577 

 Home equity

 5,602

 2,126

 —

 16,743

 24,471

 1,346,042

 1,370,513 

 Other consumer

 1,370

 830

 —

 859

 3,059

 393,765

 396,824 

 Consumer portfolio

 19,135

 6,030

 —

 35,789

 60,954

 11,305,960

 11,366,914 

 Total

 $
    57,989

 $
     8,671

 $
     —

 $
    500,414

 $
     567,074

 $
    56,030,036

 $
    56,597,110 

 13

 The following table provides additional information on non-accrual
loans and leases:

 March 31, 2026

 December 31, 2025

 (In thousands)

 Non-accrual

 Non-accrual with No
Allowance

 Non-accrual

 Non-accrual with No
Allowance

 Commercial non-mortgage

 $
 184,985

 $
 39,169 

 $
 165,378

 $
 52,284 

 Asset-based

 60,432

 — 

 66,844

 774 

 Commercial real estate

 193,949

 46,020 

 182,968

 53,385 

 Multi-family

 36,863

 27,659 

 41,095

 31,873 

 Equipment financing

 8,763

 144 

 8,340

 181 

 Commercial portfolio

 484,992

 112,992 

 464,625

 138,497 

 Residential

 20,490

 8,873 

 18,187

 8,284 

 Home equity

 16,031

 9,294 

 16,743

 8,688 

 Other consumer

 1,049

 — 

 859

 — 

 Consumer portfolio

 37,570

 18,167 

 35,789

 16,972 

 Total

 $
      522,562

 $
      131,159 

 $
      500,414

 $
      155,469 

 Allowance for Credit Losses on Loans and Leases

 The following table summarizes the change in the ACL on loans and leases by portfolio segment:

 Three months ended March 31,

 2026

 2025

 (In thousands)

 Commercial
Portfolio

 Consumer
Portfolio

 Total

 Commercial
Portfolio

 Consumer
Portfolio

 Total

 ACL on loans and leases:

 Balance, beginning of period

 $
 631,377

 $
 88,034

 $
 719,411  

 $
 635,871

 $
 53,695

 $
 689,566  

 Provision

 49,794

 5,445

 55,239  

 68,203

 10,509

 78,712 

 Charge-offs

 (40,225
 )

 (3,997
 )

 (44,222) 

 (55,566
 )

 (1,052
 )

 (56,618) 

 Recoveries

 1,017

 1,989

 3,006  

 942

 719

 1,661  

 Balance, end of period (1)

 $
 641,963

 $
 91,471

 $
 733,434  

 $
 649,450

 $
 63,871

 $
 713,321  

 Individually evaluated for credit losses

 100,272

 772

 101,044  

 93,102

 710

 93,812  

 Collectively evaluated for credit losses

 $
    541,691

 $
    90,699

 $
     632,390  

 $
    556,348

 $
     63,161

 $
    619,509  

 (1)
 The $14.0 million increase in the ACL on loans and leases from December 31, 2025, to March 31,
2026, was primarily due to an increase in individually assessed reserves and loan growth, partially offset by favorable risk rating migration.

 Concentrations of Credit Risk
 Concentrations of credit risk
may exist when a number of borrowers are engaged in similar activities, or activities in the same geographic region, and have similar economic characteristics that would cause them to be similarly impacted by changes in economic or other conditions.
Concentrations of credit risk are controlled and monitored as part of the Company’s credit policies and procedures. The Company is a regional financial services holding company in the Northeast U.S. with a commercial concentration primarily in
five geographic markets: New York City, Other New York Counties, Connecticut, New Jersey, and Massachusetts; and secondarily in the Southeast and Other states.

 The Company’s concentration of credit risk associated with commercial non-mortgage loans represented 36.5% at
March 31, 2026, and 36.0% at December 31, 2025, of total loans and leases. The Company’s concentration of credit risk associated with commercial real estate and multi-family loans, in aggregate, represented 39.4% at March 31,
2026, and 39.5% at December 31, 2025, of total loans and leases.

 14

 Credit Quality Indicators

 To measure credit risk for the commercial portfolio, the Company employs a dual grade credit risk grading system for estimating the PD and LGD. The credit risk
grade system assigns a rating to each borrower and to the facility, which together form a Composite Credit Risk Profile. The credit risk grade system categorizes borrowers by common financial characteristics that measure the credit strength of
borrowers and facilities by common structural characteristics. The Composite Credit Risk Profile has ten grades, with each grade corresponding to a progressively greater risk of loss. Grades (1) to (6) are considered pass ratings, and grades
(7) to (10) are considered criticized, as defined by the regulatory agencies. A (7) “Special Mention” rating has a potential weakness that, if left uncorrected, may result in deterioration of the repayment prospects for the asset.
An (8) “Substandard” rating has a well-defined weakness that jeopardizes the full repayment of the debt. A (9) “Doubtful” rating has all of the same weaknesses as a substandard asset with the added characteristic that the
weakness makes collection or liquidation in full, given current facts, conditions, and values, improbable. Assets classified as a (10) “Loss” rating are considered uncollectible and charged-off.
Risk ratings, which are assigned to differentiate risk within the portfolio, are reviewed on an ongoing basis and revised to reflect changes in a borrower’s current financial position and outlook, risk profile, and the related collateral and
structural position. Loan officers review updated financial information or other loan factors on at least an annual basis for all pass rated loans to assess the accuracy of the risk grade. Criticized loans undergo more frequent reviews and enhanced
monitoring.
 To measure credit risk for the consumer portfolio, the most relevant credit characteristic is the FICO score, which is a widely used credit
scoring system that ranges from 300 to 850. A lower FICO score is indicative of higher credit risk and a higher FICO score is indicative of lower credit risk. FICO scores are updated at least quarterly. Factors such as past due status, employment
status, collateral, geography, loans discharged in bankruptcy, and the status of first lien position loans on second lien position loans, are also considered to be consumer portfolio credit quality indicators. For portfolio monitoring purposes, the
Company estimates the current value of property secured as collateral for home equity and residential first mortgage lending products on an ongoing basis. The estimate is based on home price indices compiled by the S&P/Case-Shiller Home Price
Indices. Real estate price data is applied to the loan portfolios taking into account the age of the most recent valuation and geographic area.

 15

 The following tables summarize the amortized cost of commercial loans and leases by Composite Credit Risk
Profile grade and origination year:

 March 31, 2026

 (In thousands)

 2026

 2025

 2024

 2023

 2022

 Prior

 Revolving Loans
Amortized Cost
Basis

 Total

 Commercial
 non-mortgage:

 Risk rating:

 Pass

  $
 648,115

 $
 3,313,782

 $
 2,222,958

 $
 1,365,223

 $
 1,667,645

 $
 2,249,033

 $
   8,310,689

 $
 19,777,445 

 Special mention

 493

 3,886

 50,409

 10,526

 212,629

 16,307

 31,728

 325,978 

 Substandard

 1,950

 37,702

 39,030

 182,164

 239,994

 162,976

 147,984

 811,800 

 Doubtful

 —

 —

 —

 —

 —

 29

 —

 29 

 Total commercial
 non-mortgage

 650,558

 3,355,370

 2,312,397

 1,557,913

 2,120,268

 2,428,345

 8,490,401

 20,915,252 

 Current period gross write-offs

 —

 60

 —

 —

 6,514

 174

 7,607

 14,355 

 Asset-based:

 Risk rating:

 Pass

 —

 10,400

 187

 1,350

 —

 15,088

 923,651

 950,676 

 Special mention

 —

 —

 —

 800

 —

 —

 25,195

 25,995 

 Substandard

 2,080

 3,088

 —

 9,197

 —

 4,207

 123,745

 142,317 

 Total asset-based

 2,080

 13,488

 187

 11,347

 —

 19,295

 1,072,591

 1,118,988 

 Current period gross write-offs

 —

 —

 —

 —

 —

 —

 7,289

 7,289 

 Commercial real estate:

 Risk rating:

 Pass

 1,240,656

 3,230,609

 1,920,371

 1,838,531

 1,990,189

 4,054,134

 347,828

 14,622,318 

 Special mention

 6,105

 —

 —

 —

 —

 30,199

 —

 36,304 

 Substandard

 —

 —

 5,134

 154,353

 137,943

 278,812

 —

 576,242 

 Total commercial real estate

   1,246,761

   3,230,609

   1,925,505

   1,992,884

   2,128,132

   4,363,145

 347,828

   15,234,864 

 Current period gross write-offs

 —

 —

 —

 15,217

 —

 —

 —

 15,217 

 Multi-family:

 Risk rating:

 Pass

 467,735

 723,199

 695,099

 1,199,669

 1,360,669

 2,689,276

 —

 7,135,647 

 Special mention

 —

 —

 —

 —

 —

 77,605

 —

 77,605 

 Substandard

 —

 —

 —

 11,918

 29,567

 79,479

 —

 120,964 

 Total multi-family

 467,735

 723,199

 695,099

 1,211,587

 1,390,236

 2,846,360

 —

 7,334,216 

 Current period gross write-offs

 —

 —

 —

 —

 —

 1,356

 —

 1,356 

 Equipment financing:

 Risk rating:

 Pass

 108,143

 434,244

 285,771

 126,547

 105,994

 118,987

 —

 1,179,686 

 Special mention

 —

 4,737

 5,233

 292

 1,987

 2,078

 —

 14,327 

 Substandard

 —

 2,958

 867

 19,058

 22,535

 14,700

 —

 60,118 

 Total equipment financing

 108,143

 441,939

 291,871

 145,897

 130,516

 135,765

 —

 1,254,131 

 Current period gross write-offs

 —

 —

 171

 839

 459

 539

 —

 2,008 

 Total commercial portfolio

 2,475,277

 7,764,605

 5,225,059

 4,919,628

 5,769,152

 9,792,910

 9,910,820

 45,857,451 

 Current period gross write-offs

  $
 —

 $
 60

 $
 171

 $
 16,056

 $
 6,973

 $
 2,069

 $
 14,896

 $
 40,225 

 16

 December 31, 2025

 (In thousands)

 2025

 2024

 2023

 2022

 2021

 Prior

 Revolving Loans
Amortized Cost
Basis

 Total

 Commercial
 non-mortgage:

 Risk rating:

 Pass

  $
 3,378,004

 $
 2,340,865

 $
 1,463,952

 $
 1,857,656

 $
 853,239

 $
 1,420,790

 $
   7,929,719

 $
 19,244,225 

 Special mention

 4,213

 46,657

 50,332

 181,775

 32,948

 15,264

 38,883

 370,072 

 Substandard

 67,353

 33,646

 144,627

 219,885

 88,312

 42,874

 194,220

 790,917 

 Doubtful

 —

 —

 —

 —

 1

 22

 —

 23 

 Total commercial
 non-mortgage

 3,449,570

 2,421,168

 1,658,911

 2,259,316

 974,500

 1,478,950

 8,162,822

 20,405,237 

 Current period gross write-offs

 6,716

 3,550

 7,817

 13,774

 721

 17,166

 26,157

 75,901 

 Asset-based:

 Risk rating:

 Pass

 10,550

 199

 2,320

 —

 —

 15,901

 1,036,960

 1,065,930 

 Special mention

 —

 —

 7,063

 —

 —

 —

 8,069

 15,132 

 Substandard

 1,445

 —

 3,898

 —

 —

 4,833

 139,993

 150,169 

 Total asset-based

 11,995

 199

 13,281

 —

 —

 20,734

 1,185,022

 1,231,231 

 Current period gross write-offs

 —

 —

 —

 —

 —

 —

 37,870

 37,870 

 Commercial real estate:

 Risk rating:

 Pass

 3,462,637

 2,091,777

 2,092,674

 2,337,376

 1,105,105

 3,268,858

 273,252

 14,631,679 

 Special mention

 —

 —

 16,834

 75,651

 —

 29,401

 —

 121,886 

 Substandard

 —

 3,240

 168,356

 93,572

 100,957

 206,317

 —

 572,442 

 Total commercial real estate

   3,462,637

   2,095,017

   2,277,864

   2,506,599

   1,206,062

   3,504,576

 273,252

   15,326,007 

 Current period gross write-offs

 —

 —

 31,057

 256

 1,283

 27,514

 —

 60,110 

 Multi-family:

 Risk rating:

 Pass

 736,744

 691,180

 1,193,933

 1,370,368

 810,954

 1,988,941

 —

 6,792,120 

 Special mention

 —

 —

 —

 —

 3,865

 68,742

 —

 72,607 

 Substandard

 —

 —

 11,915

 26,377

 38,819

 67,001

 —

 144,112 

 Total multi-family

 736,744

 691,180

 1,205,848

 1,396,745

 853,638

 2,124,684

 —

 7,008,839 

 Current period gross write-offs

 —

 —

 —

 —

 —

 990

 —

 990 

 Equipment financing:

 Risk rating:

 Pass

 454,313

 305,538

 141,372

 120,382

 59,566

 96,161

 —

 1,177,332 

 Special mention

 4,931

 5,700

 2,573

 2,430

 1,087

 1,663

 —

 18,384 

 Substandard

 3,145

 696

 17,898

 24,897

 9,501

 7,029

 —

 63,166 

 Total equipment financing

 462,389

 311,934

 161,843

 147,709

 70,154

 104,853

 —

 1,258,882 

 Current period gross write-offs

 —

 —

 1,356

 4,614

 174

 749

 —

 6,893 

 Total commercial portfolio

 8,123,335

 5,519,498

 5,317,747

 6,310,369

 3,104,354

 7,233,797

 9,621,096

 45,230,196 

 Current period gross write-offs

  $
 6,716

 $
 3,550

 $
 40,230

 $
 18,644

 $
 2,178

 $
 46,419

 $
 64,027

 $
 181,764 

 17

 The following tables summarize the amortized cost of consumer loans by FICO score and origination year:

 March 31, 2026

 (In thousands)

 2026

 2025

 2024

 2023

 2022

 Prior

 Revolving Loans
Amortized Cost
Basis

 Total

 Residential:

 Risk rating:

 800+

  $
 46,950

 $
 611,409

 $
 483,167

 $
   272,596

 $
 888,859

 $
 2,214,476

 $
 —

 $
 4,517,457 

 740-799

 150,556

 634,107

 371,786

 187,994

 483,261

 1,329,082

 —

 3,156,786 

 670-739

 18,963

 202,491

 124,037

 72,674

 287,750

 848,263

 —

 1,554,178 

 580-669

 2,892

 21,273

 10,648

 21,181

 53,286

 144,485

 —

 253,765 

 579 and below

 —

 1,667

 4,694

 6,146

 21,399

 83,934

 —

 117,840 

 Total residential

   219,361

   1,470,947

   994,332

 560,591

   1,734,555

   4,620,240

 —

   9,600,026 

 Current period gross write-offs

 —

 —

 —

 —

 101

 25

 —

 126 

 Home equity:

 Risk rating:

 800+

 2,563

 11,259

 8,850

 21,717

 23,419

 90,377

 338,281

 496,466 

 740-799

 2,800

 15,195

 8,835

 15,681

 13,577

 52,103

 309,471

 417,662 

 670-739

 2,877

 11,324

 9,658

 9,237

 9,798

 34,922

 210,996

 288,812 

 580-669

 151

 1,159

 1,478

 2,805

 2,617

 12,989

 70,349

 91,548 

 579 and below

 —

 76

 1,052

 1,819

 2,462

 8,064

 37,796

 51,269 

 Total home equity

 8,391

 39,013

 29,873

 51,259

 51,873

 198,455

     966,893

 1,345,757 

 Current period gross write-offs

 —

 —

 —

 —

 —

 4

 6

 10 

 Other consumer:

 Risk rating:

 800+

 6,669

 9,431

 3,910

 168

 54

 1,817

 15,050

 37,099 

 740-799

 38,112

 77,985

 37,463

 393

 135

 177

 3,485

 157,750 

 670-739

 52,809

 120,419

 56,904

 235

 176

 207

 13,007

 243,757 

 580-669

 728

 2,417

 1,732

 86

 47

 48

 1,036

 6,094 

 579 and below

 —

 35

 16

 47

 42

 11

 457

 608 

 Total other consumer

 98,318

 210,287

 100,025

 929

 454

 2,260

 33,035

 445,308 

 Current period gross write-offs

 1,070

 677

 2,028

 3

 5

 4

 74

 3,861 

 Total consumer portfolio

 326,070

 1,720,247

 1,124,230

 612,779

 1,786,882

 4,820,955

 999,928

 11,391,091 

 Current period gross write-offs

  $
 1,070

 $
 677

 $
 2,028

 $
 3

 $
 106

 $
 33

 $
 80

 $
 3,997 

 18

 December 31, 2025

 (In thousands)

 2025

 2024

 2023

 2022

 2021

 Prior

 Revolving Loans
Amortized Cost
Basis

 Total

 Residential:

 Risk rating:

 800+

  $
 517,482

 $
 551,613

 $
 272,249

 $
 918,256

 $
 1,045,573

 $
 1,258,654

 $
 —

 $
 4,563,827 

 740-799

 687,120

 419,019

 212,246

 480,885

 598,172

 748,825

 —

 3,146,267 

 670-739

 185,620

 118,104

 84,332

 294,954

 241,266

 604,881

 —

 1,529,157 

 580-669

 16,852

 19,346

 23,602

 51,886

 45,714

 100,593

 —

 257,993 

 579 and below

 648

 2,377

 3,952

 21,911

 21,966

 51,479

 —

 102,333 

 Total residential

   1,407,722

   1,110,459

   596,381

   1,767,892

   1,952,691

   2,764,432

 —

   9,599,577 

 Current period gross write-offs

 —

 —

 —

 —

 —

 135

 —

 135 

 Home equity:

 Risk rating:

 800+

 11,847

 8,896

 23,146

 22,811

 29,498

 65,401

 348,961

 510,560 

 740-799

 15,932

 11,658

 16,149

 16,523

 19,123

 35,861

 317,846

 433,092 

 670-739

 10,811

 9,786

 10,120

 9,351

 11,025

 27,662

 217,924

 296,679 

 580-669

 1,682

 1,522

 2,850

 2,731

 2,941

 9,607

 68,953

 90,286 

 579 and below

 77

 499

 1,662

 2,287

 908

 4,543

 29,920

 39,896 

 Total home equity

 40,349

 32,361

 53,927

 53,703

 63,495

 143,074

 983,604

 1,370,513 

 Current period gross write-offs

 —

 50

 —

 1

 —

 38

 175

 264 

 Other consumer:

 Risk rating:

 800+

 11,131

 4,799

 254

 74

 1,677

 171

 16,597

 34,703 

 740-799

 88,171

 46,222

 368

 145

 30

 136

 3,273

 138,345 

 670-739

 133,564

 68,381

 282

 231

 130

 133

 14,439

 217,160 

 580-669

 2,651

 1,962

 74

 60

 27

 59

 1,136

 5,969 

 579 and below

 34

 36

 65

 53

 19

 2

 438

 647 

 Total other consumer

 235,551

 121,400

 1,043

 563

 1,883

 501

 35,883

 396,824 

 Current period gross write-offs

 3,325

 3,591

 19

 10

 7

 7

 168

 7,127 

 Total consumer portfolio

 1,683,622

 1,264,220

 651,351

 1,822,158

 2,018,069

 2,908,007

   1,019,487

 11,366,914 

 Current period gross write-offs

  $
 3,325

 $
 3,641

 $
 19

 $
 11

 $
 7

 $
 180

 $
 343

 $
 7,526 

 Collateral Dependent Loans and Leases

 A non-accrual loan or lease is considered collateral dependent when the borrower is experiencing financial difficulty
and when repayment is substantially expected to be provided through the operation or sale of collateral. Commercial non-mortgage loans, asset-based loans, and equipment financing loans and leases are generally
secured by machinery and equipment, inventory, receivables, or other non-real estate assets, whereas commercial real estate, multi-family, residential, and home equity loans are secured by real estate.

 The carrying amount of collateral dependent loans was $288.8 million at March 31, 2026, and $308.3 million at December 31, 2025, for
commercial loans and leases, and $26.4 million at March 31, 2026, and $28.1 million at December 31, 2025, for consumer loans. The ACL for collateral dependent loans and leases is individually assessed based on the fair value of
the collateral less costs to sell at the reporting date. The aggregate collateral value associated with collateral dependent loans and leases was $315.1 million at March 31, 2026, and $364.3 million at December 31, 2025.

 Modifications to Borrowers Experiencing Financial Difficulty

 In certain circumstances, the Company enters into agreements to modify the terms of loans to borrowers experiencing financial difficulty. A variety of solutions
are offered to borrowers experiencing financial difficulty, including loan modifications that may result in principal forgiveness, interest rate reductions, payment delays, term extensions, or a combination thereof. The following is a description of
each of these types of modifications:

 •
 Principal forgiveness – The outstanding principal balance of a loan may be reduced by a specified
amount. Principal forgiveness may occur voluntarily as part of a negotiated agreement with a borrower, or involuntarily through a bankruptcy proceeding.

 •
 Interest rate reductions – Includes modifications where the contractual interest rate of the loan
has been reduced.

 •
 Payment delays – Deferral arrangements that allow borrowers to delay a scheduled loan payment to a
later date. Deferred loan payments do not affect the original contractual maturity terms of the loan. Modifications that result in only an insignificant payment delay are not disclosed. The Company generally considers a payment delay of three months
or less to be insignificant.

 19

 •

 Term extensions – Extensions of the original contractual maturity date of the loan.

 •

 Combination – Combination includes loans that have undergone more than one of the above loan
modification types.

 Significant judgment is required to determine if a borrower is experiencing financial difficulty. These
considerations vary by portfolio class. The Company has identified modifications to borrowers experiencing financial difficulty that are included in its disclosures as follows:

 •

 Commercial: The Company evaluates modifications of loans to commercial borrowers that are rated substandard
or worse, and includes the modifications in its disclosures to the extent that the modification is considered other-than-insignificant.

 •

 Consumer: The Company generally evaluates all modifications of loans to consumer borrowers subject to its
loss mitigation program and includes them in its disclosures to the extent that the modification is considered other-than-insignificant.

 The following tables summarize the amortized cost at March 31, 2026, and at March 31, 2025, of loans modified to borrowers experiencing financial
difficulty, disaggregated by class and type of concession granted:

 Three months ended March 31, 2026

 (Dollars in thousands)

  Term Extension  

   Payment Delay  

   Combination - Term  
 Extension &
Interest
 Rate Reduction

     Total    

   % of Total  
 Class (2)

 Commercial non-mortgage

 $
 81,520

 $
 1,993

 $
 —

 $
 83,513

 0.4 %

 Asset-based

 41,454

 6,500

 —

 47,954

 4.3   

 Commercial real estate

 84,444

 13,215

 —

 97,659

 0.6   

 Multi-family

 13,598

 —

 —

 13,598

 0.2   

 Residential

 308

 —

 58

 366

 —   

 Total (1)

 $
 221,324

 $
 21,708

 $
 58

 $
 243,090

 0.4 %

 Three months ended March 31, 2025

 (Dollars in thousands)

 Term Extension

 Payment Delay

 Combination -Term
 Extension & Interest
 Rate Reduction

 Total

 % of Total Class (2)

 Commercial non-mortgage

 $
 43,880

 $
 24,106

 $
 115

 $
 68,101

 0.4 %

 Commercial real estate

 20,700

 512

 —

 21,212

 0.1   

 Multi-family

 2,414

 —

 —

 2,414

 —   

 Equipment financing

 207

 —

 —

 207

 —   

 Residential

 —

 —

 900

 900

 —   

 Home equity

 —

 —

 40

 40

 —   

 Total (1)

 $
 67,201

 $
 24,618

 $
 1,055

 $
 92,874

 0.2 %

 (1)
 The total amortized cost excludes accrued interest receivable of $1.1 million at March 31, 2026, and
$0.1 million at March 31, 2025.

 (2)
 Represents the total amortized cost of the loans modified as a percentage of the total period end loan balance
by class.

 The following tables describe the financial effect of the modifications made to borrowers experiencing financial difficulty:

 Three months ended March 31, 2026

 Financial Effect
 (1)

 Term Extension:

 Commercial non-mortgage

 Extended term by a weighted average of 1.4 years

 Asset-based

 Extended term by a weighted average of 0.6 years

 Commercial real estate

 Extended term by a weighted average of 0.5 years

 Multi-family

 Extended term by a weighted average of 1.8 years

 Payment Delay:

 Commercial non-mortgage

 Provided payment deferrals for a weighted average of 0.5 years

 Asset-based

 Provided payment deferrals for a weighted average of 0.5 years

 Commercial real estate

 Provided payment deferrals for a weighted average of 1.7 years

 20

 Three months ended March 31, 2025

 Financial Effect
 (1)

 Term Extension:

 Commercial non-mortgage

 Extended term by a weighted average of 1.3 years

 Commercial real estate

 Extended term by a weighted average of 0.9 years

 Multi-family

 Extended term by a weighted average of 0.7 years

 Payment Delay:

 Commercial non-mortgage

 Provided partial payment deferrals for a weighted average of 0.5 years

 (1)
 Certain disclosures related to the financial effects of modifications do not include those deemed to be
immaterial.

 The Company closely monitors the performance of the loans that are modified with borrowers experiencing financial difficulty
to understand the effectiveness of its modification efforts. The following tables summarize the aging of loans that had been modified in the 12 months preceding March 31, 2026, and March 31, 2025:

 March 31, 2026

 (In thousands)

    Current   

   30-59 Days  
 Past Due

   60-89 Days  
 Past Due

 90 or More
   Days Past Due  

   Non-Accrual  

    Total   

 Commercial non-mortgage

 $
 143,335

 $
 14,923

 $
 897

 $
 —

 $
 50,265

 $
 209,420

 Asset-based

 51,883

 —

 —

 —

 23,467

 75,350

 Commercial real estate

 164,852

 —

 —

 —

 45,242

 210,094

 Multi-family

 52,177

 —

 —

 —

 —

 52,177

 Equipment financing

 3,167

 —

 —

 —

 2,585

 5,752

 Residential

 1,354

 —

 —

 —

 921

 2,275

 Home equity

 681

 —

 —

 —

 84

 765

 Total

 $
 417,449

 $
 14,923

 $
 897

 $
 —

 $
 122,564

 $
 555,833

 March 31, 2025

 (In thousands)

 Current

 30-59 Days
Past Due

 60-89 Days
Past Due

 90 or More
Days Past Due

 Non-Accrual

 Total

 Commercial non-mortgage

 $
 57,856

 $
 1,015

 $
 —

 $
 —

 $
 148,972

 $
 207,843

 Asset-based

 23,718

 —

 —

 —

 —

 23,718

 Commercial real estate

 116,386

 —

 —

 —

 30,012

 146,398

 Multi-family

 692

 1,721

 —

 —

 —

 2,413

 Equipment financing

 338

 13

 —

 —

 —

 351

 Residential

 716

 —

 —

 —

 1,074

 1,790

 Home equity

 420

 —

 —

 —

 464

 884

 Total

 $
 200,126

 $
 2,749

 $
 —

 $
 —

 $
 180,522

 $
 383,397

 Loans that had been modified with borrowers experiencing financial difficulty in the 12 months preceding March 31, 2026,
and that had a subsequent payment default during the three months ended March 31, 2026, were not significant. Loans that had been modified with borrowers experiencing financial difficulty in the 12 months preceding March 31, 2025, and that
had a subsequent payment default during the three months ended March 31, 2025, also were not significant.
 For the purpose of this disclosure, a
payment default is defined as 90 or more days past due. Non-accrual loans that are modified to borrowers experiencing financial difficulty remain on non-accrual status
until the borrower has demonstrated performance under the modified terms. Commitments to lend additional funds to borrowers experiencing financial difficulty whose loans had been modified were not significant.

 21

 Note 5: Goodwill and Other Intangible Assets

 Goodwill
 The following table summarizes changes in the
carrying amount of goodwill:

 (In thousands)

 March 31,
      2026     

 December 31,
      2025     

 Balance, beginning of period

 $
 2,897,522
  

 $
 2,868,068
  

 SecureSave acquisition (1)

 941

 29,454

 Balance, end of period

 $
 2,898,463

 $
 2,897,522

 (1)
 The increase to the carrying amount of goodwill at March 31, 2026, reflects the effects of the
measurement-period adjustment recorded during the first quarter of 2026 related to the acquisition of SecureSave in December 2025. Additional information regarding the SecureSave acquisition can be found within Note 2: Business Developments.

 Information regarding goodwill by reportable segment can be found within Note 15: Segment Reporting.

 Other Intangible Assets
 The following table summarizes
other intangible assets:

 March 31, 2026

 December 31, 2025

 (In thousands)

   Gross Carrying  

 Amount

   Accumulated  

 Amortization

   Net Carrying  

 Amount

   Gross Carrying  

 Amount

   Accumulated  

 Amortization

   Net Carrying  

 Amount

 Core deposits

 $
 339,465

 $
 104,205

 $
 235,260 

 $
 342,875

 $
 98,483

 $
 244,392 

 Customer relationships

 120,855

 62,130

 58,725 

 120,855

 59,255

 61,600 

 Non-competition agreements

 4,760

 2,684

 2,076 

 5,880

 2,400

 3,480 

 Trade name

 6,100

 2,643

 3,457 

 6,100

 2,338

 3,762 

 Total other intangible assets

 $
 471,180

 $
 171,662

 $
 299,518 

 $
 475,710

 $
 162,476

 $
 313,234 

 The remaining estimated aggregate future amortization expense for other intangible assets is as follows:

 (In thousands)

 March 31,
    2026    

 Remainder of 2026

 $
 26,648 

 2027

 34,482 

 2028

 31,370 

 2029

 29,213 

 2030

 28,272 

 Thereafter

 149,533 

 22

 Note 6: Deposits

 The following table summarizes deposits by type:

 (In thousands)

 March 31,
     2026    

 December 31,
     2025    

 Non-interest-bearing:

 Demand

 $
 9,847,077 

 $
 10,082,854 

 Interest-bearing:

 Checking

 11,932,682 

 10,760,496 

 Health savings accounts

 9,446,895 

 9,184,452 

 Money market

 24,332,087 

 23,196,747 

 Savings

 6,841,135 

 6,964,946 

 Time deposits

 6,639,840 

 8,570,318 

 Total interest-bearing

 $
 59,192,639 

 $
 58,676,959 

 Total deposits

 $
 69,039,716 

 $
 68,759,813 

 Time deposits, money market, and interest-bearing checking obtained through brokers (1)

 $
 1,670,013 

 $
 3,134,894 

 Aggregate amount of time deposit accounts that exceeded the FDIC limit (2)

 1,454,233 

 1,494,626 

 Deposit overdrafts reclassified as loan balances

 4,461 

 6,674 

 (1)
 Excludes money market deposits received through interSYNC of $9.4 billion at March 31, 2026, and
$9.3 billion at December 31, 2025.

 (2)
 Excludes an aggregate amount of time deposit accounts that were at the FDIC limit of $8.5 million at
March 31, 2026, and $10.5 million at December 31, 2025.

 The following table summarizes the scheduled maturities of time
deposits:

 (In thousands)

 March 31,
     2026    

 Remainder of 2026

 $
 6,286,982 

 2027

 286,202 

 2028

 23,344 

 2029

 16,013 

 2030

 22,211 

 Thereafter

 5,088 

 Total time deposits

 $
 6,639,840 

 23

 Note 7: Borrowings

 Securities Sold Under Agreements to Repurchase
 The
following table summarizes securities sold under agreements to repurchase:

 March 31, 2026

 December 31, 2025

 (Dollars in thousands)

  Total Outstanding 

    Rate   

  Total Outstanding 

    Rate   

 Securities sold under agreements to repurchase
 (1)

 $
 69,756

 0.12 % 

 $
 596,738

 3.32 % 

 (1)
 Securities sold under agreements to repurchase have an original maturity date of one year or less for the
periods presented.

 The Company’s repurchase agreement counterparties are limited to primary dealers in government securities and
commercial and municipal customers through the Corporate Treasury function. The Company has the right of offset with respect to repurchase agreement assets and liabilities with the same counterparty when master netting agreements are in place.
Securities sold under agreements to repurchase are presented as gross transactions at March 31, 2026, and at December 31, 2025, since only liabilities are outstanding. Agency MBS securities, which had an aggregate carrying value of
$71.8 million at March 31, 2026, and $625.3 million at December 31, 2025, are pledged to secure repurchase agreements. These Agency MBS securities are subject to changes in market value and, therefore, the Company may increase or
decrease the level of securities pledged as collateral based upon movements in market value.
 The following tables represent the offsetting of repurchase
agreements that are subject to master netting agreements:

 March 31, 2026

 Gross Amounts Not Offset in the Statement

 of Financial Position

 Gross Amounts of
Recognized
Liabilities

 Gross Amounts
Offset in the
Statement of
Financial Position

 Net Amounts of
Liabilities
Presented in the
Statement of
Financial Position

 (In thousands)

 Financial

  Instruments 

   Cash Collateral  

 Pledged

  Net Amount  

 Repurchase agreements

 $
 —

 $
 —

 $
 —

 $
 —

 $
 —

 $
 — 

 December 31, 2025

 Gross Amounts Not Offset in the Statement

 of Financial Position

 Gross Amounts of
Recognized
Liabilities

 Gross Amounts
Offset in the
Statement of
Financial Position

 Net Amounts of
Liabilities
Presented in the
Statement of
Financial Position

 (In thousands)

 Financial
Instruments (1)

 Cash Collateral
Pledged

 Net Amount

 Repurchase agreements

 $
 494,420

 $
 —

 $
 494,420

 $
 494,420

 $
 —

 $
 — 

 (1)
 Amounts disclosed are limited to the balance of securities sold under agreements to repurchase reported on the
accompanying Condensed Consolidated Balance Sheets that are subject to master netting agreements and, accordingly, exclude excess collateral pledged. At December 31, 2025, Agency MBS with an aggregate carrying value of $520.1 million was
pledged as collateral against such securities sold under agreements to repurchase, resulting in an excess collateral positions of $25.6 million.

 FHLB Advances
 The following table summarizes information
for FHLB advances:

 March 31, 2026

 December 31, 2025

 (Dollars in thousands)

  Total Outstanding 

 Weighted-
Average Contractual Coupon
Rate

  Total Outstanding 

 Weighted-
Average Contractual Coupon
Rate

 Maturing within 1 year

 $
 4,800,000 

 3.84 %

 $
 2,970,000 

 3.44 %

 After 1 but within 2 years

 394 

 1.38   

 201 

 —   

 After 2 but within 3 years

 — 

 —   

 201 

 2.75   

 After 3 but within 4 years

 608 

 1.75   

 615 

 1.75   

 After 4 but within 5 years

 3,638 

 1.25   

 3,669 

 1.25   

 After 5 years

 5,979 

 2.16   

 6,032 

 2.16   

 Total FHLB advances

 $
 4,810,619 

 3.84 %

 $
 2,980,718 

 3.44 %

 Aggregate market value of assets pledged as collateral

 $
 17,752,710 

 $
 16,331,016 

 Remaining borrowing capacity at the FHLB of Boston

 7,016,007 

 7,882,187 

 The Bank may borrow up to a discounted amount of eligible loans and securities that have been pledged as collateral to secure
FHLB advances, which includes certain residential, multi-family, and commercial real estate loans, home equity lines of credit, Agency MBS, and Agency CMO. The Bank was in compliance with its FHLB collateral requirements at March 31, 2026, and
at December 31, 2025.

 24

 Long-term Debt

 The following table summarizes long-term debt:

 (Dollars in thousands)

 March 31,
     2026    

 December 31,
     2025    

 4.100% Senior fixed-rate notes due March 25, 2029 (1)

 $
 316,059

 $
 317,398

 5.784% Fixed-rate reset subordinated notes due September 11, 2035

 350,000

 350,000

 Junior subordinated debt Webster Statutory Trust I floating-rate notes due September 17, 2033 (2)

 77,320

 77,320

 Total senior and subordinated debt

 743,379

 744,718

 Discount on senior fixed-rate notes

 (298
 )

 (323
 )

 Debt issuance cost on senior fixed-rate notes

 (802
 )

 (869
 )

 Discount on fixed-rate reset subordinated notes

 (2,479
 )

 (2,545
 )

 Debt issuance cost on fixed-rate reset subordinated notes

 (1,488
 )

 (1,527
 )

 Total long-term debt (3)

 $
 738,312

 $
 739,454

 (1)
 The Company de-designated its fair value hedging relationship on these
senior fixed-rate notes in 2020. A basis adjustment of $16.1 million at March 31, 2026, and $17.4 million at December 31, 2025, is included in the carrying value and is being amortized over the remaining life of the senior
fixed-rate notes.

 (2)
 The interest rate on the Webster Statutory Trust I floating-rate notes varies quarterly based on 3-month SOFR plus a credit spread adjustment plus a market spread of 2.95%, which yielded 6.89% at March 31, 2026, and 6.92% at December 31, 2025.

 (3)
 The classification of debt as long-term is based on the initial term of greater than one year as of the date of
issuance.

 Additional information regarding the Company’s long-term debt can be found within Note 10: Borrowings in the Notes to
Consolidated Financial Statements contained in Part II - Item 8. Financial Statements and Supplementary Data of the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

 25

 Note 8: Stockholders’ Equity

 The following table summarizes the changes in shares of preferred and common stock issued and common stock held as treasury stock:

 Preferred Stock Series
F Issued

 Preferred Stock Series
G Issued

 Common Stock Issued

 Treasury Stock Held

 Common Stock

 Outstanding

 Balance at December 31, 2025

 6,000

 135,000

 182,778,045

 21,562,037

 161,216,008

 Stock compensation plan activity (1)

 —

 —

 —

 (832,989
 )

 832,989

 Balance at March 31, 2026

 6,000

 135,000

 182,778,045

 20,729,048

 162,048,997

 Balance at December 31, 2024

 6,000

 135,000

 182,778,045

 11,386,920

 171,391,125

 Stock compensation plan activity (1)

 —

 —

 —

 (772,605
 )

 772,605

 Common stock repurchase program

 —

 —

 —

 3,569,454

 (3,569,454
 )

 Balance at March 31, 2025

 6,000

 135,000

 182,778,045

 14,183,769

 168,594,276

 (1)
 Reflects (i) common shares issued from Treasury stock for time-based restricted stock award grants, net of
forfeitures, and the vesting of performance-based restricted stock awards of 1,253,851 and 1,157,278, in aggregate, during the three months ended March 31, 2026, and 2025, respectively, less (ii) common shares acquired outside of the
Company’s common stock repurchase program related to stock compensation plan activity of 420,862 and 384,673 during the three months ended March 31, 2026, and 2025, respectively.

 Common Stock Repurchase Program
 Information regarding the
Company’s common stock repurchase program be found within Note 11: Stockholders’ Equity in the Notes to Consolidated Financial Statements contained in Part II - Item 8. Financial Statements and Supplementary Data of the Company’s
Annual Report on Form 10-K for the year ended December 31, 2025. There were no common stock repurchases under the Company’s common stock repurchase program during the three months ended
March 31, 2026.
 Preferred Stock
 Information
regarding the Company’s preferred stock can be found within Note 11: Stockholders’ Equity in the Notes to Consolidated Financial Statements contained in Part II - Item 8. Financial Statements and Supplementary Data of the Company’s
Annual Report on Form 10-K for the year ended December 31, 2025.

 26

 Note 9: Accumulated Other Comprehensive (Loss), Net of Tax

 The following tables summarize the change in each component of accumulated other comprehensive (loss), net of the related tax impact:

 Three months ended March 31, 2026

 (In thousands)

   Investment  

 Securities

 Available-
 for-Sale

 Derivative

 Financial

   Instruments  

 Defined Benefit

  Pension and Other 

 Postretirement
 Benefit
Plans

    Total   

 Balance, beginning of period

 $
 (334,113
 )

 $
 3,741

 $
 (20,472
 )

 $
 (350,844) 

 Other comprehensive (loss) before reclassifications

 (74,615
 )

 (4,887
 )

 —

 (79,502) 

 Amounts reclassified from accumulated other comprehensive (loss) income

 —

 (245
 )

 42

 (203) 

 Other comprehensive (loss) income, net of tax

 (74,615
 )

 (5,132
 )

 42

 (79,705) 

 Balance, end of period

 $
 (408,728
 )

 $
 (1,391
 )

 $
 (20,430
 )

 $
 (430,549) 

 Three months ended March 31, 2025

 (In thousands)

 Investment
Securities
Available-
 for-Sale

 Derivative
Financial
Instruments

 Defined Benefit
Pension and Other
Postretirement
Benefit Plans

 Total

 Balance, beginning of period

 $
 (520,318
 )

 $
 (9,600
 )

 $
 (26,465
 )

 $
 (556,383) 

 Other comprehensive income before reclassifications

 96,966

 7,752

 —

 104,718  

 Amounts reclassified from accumulated other comprehensive (loss)

 (385
 )

 2,372

 277

 2,264  

 Other comprehensive income, net of tax

 96,581

 10,124

 277

 106,982  

 Balance, end of period

 $
 (423,737
 )

 $
 524

 $
 (26,188
 )

 $
 (449,401) 

 The following table further summarizes the amounts reclassified from accumulated other comprehensive (loss):

 Accumulated Other Comprehensive

 (Loss) Components

 Three months ended
 March 31,

   Associated Line Item on the Condensed Consolidated  

 Statements of Income

 2026

 2025

 (In thousands)

 Investment securities
 available-for-sale:

 Net gains (1)

 $
 — 

 $
     528 

 Gain on sale of investment securities, net (2)

 Tax (expense)

 — 

 (143)

 Income tax expense

 Net of tax

 $
 — 

 $
 385 

 Derivative financial instruments:

 Interest payments (3)

 $
 336 

 $
 (3,255)

 Interest and fees on loans and leases

 Tax (expense) benefit

 (91)

 883 

 Income tax expense

 Net of tax

 $
     245 

 $
 (2,372)

 Defined benefit pension and other postretirement
benefit plans:

 Net actuarial (losses)

 $
 (58)

 $
 (380)

 Other expense

 Tax benefit

 16 

 103 

 Income tax expense

 Net of tax

 $
 (42)

 $
 (277)

 (1)
 Reclassification adjustments for investment securities available-for-sale that were sold are determined by reference to the unrealized gain or loss reported in the month prior to sale.

 (2)
 Gains and losses realized on sales of investment securities available-for-sale are generally included as a component of non-interest income on the accompanying Condensed Consolidated Statements of Income unless any portion or
all of the loss is due to credit related factors, in which the amount is then included in the Provision for credit losses. None of the gross losses realized on sale of
 available-for-sale securities during the three months ended March 31, 2025, were due to credit related factors.

 (3)
 Over the next 12 months, an estimated $1.4 million related to cash flow hedge gain or loss will be
reclassified from AOCL, decreasing Interest and fees on loans and leases as hedge interest payments are made.

 27

 Note 10: Regulatory Capital and Restrictions

 Regulatory Capital Requirements
 The Company and the Bank
are subject to various regulatory capital requirements administered by the federal bank regulatory agencies. Failure to meet minimum capital requirements can initiate certain mandatory actions by regulators that could have a direct material effect
on the Company’s financial statements. Under capital adequacy guidelines and/or the regulatory framework for prompt corrective action, which applies to the Bank only, both the Company and the Bank must meet specific capital guidelines that
involve quantitative measures of assets, liabilities, and certain off-balance sheet items calculated pursuant to regulatory directives. Capital amounts and classification are also subject to qualitative
judgments by the regulators about components, risk weightings, and other factors.
 Quantitative measures established by the Basel III Capital Rules, as
adopted in the U.S., to ensure capital adequacy require the Company and the Bank to maintain minimum ratios of CET1 Risk-Based Capital, Tier 1 Risk-Based Capital, Total Risk-Based Capital, and Tier 1 Leverage Ratio, as defined in the regulations.
CET1 capital consists of common stockholders’ equity, less deductions for goodwill and other intangible assets, and certain deferred tax adjustments. At the time of initial adoption of the Basel III Capital Rules, the Company had elected to opt-out of the requirement to include certain components of AOCI in CET1 capital. Tier 1 capital consists of CET1 capital plus preferred stock. Total capital consists of Tier 1 capital and Tier 2 capital, as defined
in the regulations. Tier 2 capital includes qualifying subordinated debt and the permissible portion of the ACL.
 Both the Company and the Bank were
classified as “well-capitalized” at March 31, 2026, and at December 31, 2025.
 The following tables provide information on the
regulatory capital ratios for the Company and the Bank:

 March 31, 2026

 Actual

 Minimum Requirement

 Well Capitalized

 (Dollars in thousands)

    Amount   

    Ratio   

    Amount   

    Ratio   

    Amount   

    Ratio   

 Webster Financial Corporation

 CET1 Risk-Based Capital

 $
 6,614,681

 11.42
 %

 $
 2,606,184

 4.5
 %

 $
 3,764,488

 6.5
 %

 Tier 1 Risk-Based Capital

 6,898,660

 11.91 

 3,474,912

 6.0 

 4,633,216

 8.0 

 Total Risk-Based Capital

 8,045,478

 13.89 

 4,633,216

 8.0 

 5,791,519

 10.0 

 Tier 1 Leverage Ratio

 6,898,660

 8.37 

 3,296,999

 4.0 

 4,121,249

 5.0 

 Webster Bank

 CET1 Risk-Based Capital

 $
 6,994,801

 12.07
 %

 $
 2,608,116

 4.5
 %

 $
 3,767,279

 6.5
 %

 Tier 1 Risk-Based Capital

 6,994,801

 12.07 

 3,477,488

 6.0 

 4,636,651

 8.0 

 Total Risk-Based Capital

 7,718,266

 13.32 

 4,636,651

 8.0 

 5,795,814

 10.0 

 Tier 1 Leverage Ratio

 6,994,801

 8.49 

 3,293,654

 4.0 

 4,117,067

 5.0 

 December 31, 2025

 Actual

 Minimum Requirement

 Well Capitalized

 (Dollars in thousands)

 Amount

 Ratio

 Amount

 Ratio

 Amount

 Ratio

 Webster Financial Corporation

 CET1 Risk-Based Capital

 $
 6,441,440

 11.20
 %

 $
 2,588,039

 4.5
 %

 $
 3,738,279

 6.5
 %

 Tier 1 Risk-Based Capital

 6,725,419

 11.69 

 3,450,719

 6.0 

 4,600,959

 8.0 

 Total Risk-Based Capital

 7,861,688

 13.67 

 4,600,959

 8.0 

 5,751,199

 10.0 

 Tier 1 Leverage Ratio

 6,725,419

 8.33 

 3,230,039

 4.0 

 4,037,549

 5.0 

 Webster Bank

 CET1 Risk-Based Capital

 $
 7,007,352

 12.19
 %

 $
 2,586,346

 4.5
 %

 $
 3,735,833

 6.5
 %

 Tier 1 Risk-Based Capital

 7,007,352

 12.19 

 3,448,461

 6.0 

 4,597,948

 8.0 

 Total Risk-Based Capital

 7,720,373

 13.43 

 4,597,948

 8.0 

 5,747,435

 10.0 

 Tier 1 Leverage Ratio

 7,007,352

 8.69 

 3,226,561

 4.0 

 4,033,202

 5.0 

 Dividend Restrictions
 The
Company is dependent upon dividends from the Bank to provide funds for the payment of dividends to stockholders and for other cash requirements. Dividends paid by the Bank are subject to various federal and state regulatory limitations. Express
approval by the OCC is required if the effect of dividends declared would cause the regulatory capital of the Bank to fall below specified minimum levels or if the amount would exceed net income for that year combined with undistributed net income
for the preceding two years. The Bank paid the Company dividends of $300.0 million for the three months ended March 31, 2026, and $100.0 million for the three months ended March 31, 2025, for which no express approval from the
OCC was required.

 28

 Cash Restrictions

 The Bank is required under Federal Reserve regulations to maintain cash reserve balances in the form of vault cash or deposits held at a FRB to ensure that it
is able to meet customer demands. The reserve requirement ratio is subject to adjustment as economic conditions warrant. On March 26, 2020, the Federal Reserve reduced the reserve requirement ratios on all net transaction accounts to zero
percent. As a result, the Bank has not been required to hold cash reserve balances since that date.

 29

 Note 11: Variable Interest Entities

 The Company has an investment interest in the following entities that each meet the definition of a VIE. Information regarding the consolidation of VIEs can be
found within Note 1: Summary of Significant Accounting Policies in the Notes to Consolidated Financial Statements contained in Part II - Item 8. Financial Statements and Supplementary Data of the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
 Consolidated

 Rabbi Trusts. The Company had established a Rabbi Trust to meet its obligations due under the Webster Bank Deferred Compensation Plan for
Directors and Officers. The funding of this Rabbi Trust and the discontinuation of the Webster Bank Deferred Compensation Plan for Directors and Officers occurred during 2012. In 2025, the Company amended the Rabbi Trust that had been established
for the Webster Bank Deferred Compensation Plan for Directors and Officers to also cover the funding of its obligations due under the Webster Bank Deferred Director Fee Plan. Further, in connection with the merger with Sterling Bancorp in 2022, the
Company acquired assets held in separate Rabbi Trusts that had respectively established to fund obligations due under the Greater New York Savings Bank Directors’ Retirement Plan and the Sterling National Bank Nonqualified Deferred
Compensation Plan (renamed as the Webster Bank Nonqualified Deferred Compensation Plan).
 The Company is considered the primary beneficiary of these Rabbi
Trusts as it has the power to direct the activities that most significantly impact their economic performance and it has the obligation to absorb losses and/or the right to receive benefits that could potentially be significant. The aggregate
carrying value of the Company’s Rabbi Trust assets was $31.4 million at March 31, 2026, and $28.6 million at December 31, 2025, the majority of which are included in Accrued interest receivable and other assets on the
accompanying Condensed Consolidated Balance sheets, with a portion also included in the Cash surrender value of life insurance policies. Investment earnings and changes in fair value, and changes in cash surrender value, are included in Other income
and the Cash surrender value of life insurance policies, respectively, on the accompanying Condensed Consolidated Statements of Income. Additional information regarding the Rabbi Trusts’ investments reported at fair value can be found within
Note 14: Fair Value Measurements.
 Non-Consolidated

 Low-Income Housing Tax Credit Investments. The Company makes
 non-marketable equity investments in entities that sponsor affordable housing and other community development projects that qualify for the LIHTC Program pursuant to Section 42 of the Internal Revenue
Code. The purpose of these investments is to not only assist the Bank in meeting its responsibilities under the CRA, but also to provide a return, primarily through the realization of tax benefits. While the Company’s investment in an entity
may exceed 50% of its outstanding equity interests, the entity is not consolidated as the Company is not the primary beneficiary. The Company has determined that it is not the primary beneficiary due to its inability to direct the activities that
most significantly impact economic performance. The Company applies the proportional amortization method to subsequently measure its investments in qualified affordable housing projects.

 The following table summarizes the Company’s LIHTC investments and related unfunded commitments:

 (In thousands)

    March 31, 2026   

   December 31, 2025  

 Gross investment in LIHTC investments

 $
 1,633,042 

 $
 1,605,955 

 Accumulated amortization

 (375,728)

 (337,375)

  Net investment in LIHTC investments

 $
 1,257,314 

 $
 1,268,580 

  

 Unfunded commitments for LIHTC investments

 $
 590,942 

 $
 634,092 

 The Company approved commitments to fund LIHTC investments of $27.1 million during the three months ended March 31,
2026, and $70.8 million during the three months ended March 31, 2025.
 The aggregate carrying value of the Company’s LIHTC investments and
the related unfunded commitments are included in Accrued interest receivable and other assets and Accrued expenses and other liabilities, respectively, on the accompanying Condensed Consolidated Balance Sheets. The Company’s maximum exposure
to loss related to its LIHTC investments is generally the aggregate carrying value as of each reporting date. However, income tax credits recognized related to these investments are subject to recapture by taxing authorities for up to a period of 15
years based on compliance provisions that are required to be met at the project level.

 30

 The following table summarizes the amount of income tax credits, other income tax benefits, and investment
amortization generated from the Company’s LIHTC investments, which are recognized as a component of income tax expense on the accompanying Condensed Consolidated Statements of Income:

    Three months ended March 31,   

 (In thousands)

 2026

 2025

 Income tax credits and other income tax benefits from LIHTC investments

 $
 (49,701)

 $
 (41,706)

 Investment amortization from LIHTC investments

 38,353 

 32,061 

 Income tax credits and other income tax benefits, and investment amortization generated from the Company’s LIHTC
investments, are included as a component of operating activities on the accompanying Condensed Consolidated Statements of Cash Flows.
 Webster
Statutory Trust I. The Company owns all the outstanding common stock of Webster Statutory Trust I, a financial vehicle that has issued, and in the future may issue, trust preferred securities. The Company is not the primary beneficiary of
Webster Statutory Trust I. The only assets of Webster Statutory Trust I are junior subordinated debentures that are issued by the Company, which were acquired using the proceeds from the issuance of trust preferred securities and common stock. The
junior subordinated debentures are included in Long-term debt on the accompanying Condensed Consolidated Balance Sheets, and the related interest expense is included in Long-term debt on the accompanying Condensed Consolidated Statements of Income.
Additional information regarding these junior subordinated debentures can be found within Note 10: Borrowings in the Notes to Consolidated Financial Statements contained in Part II - Item 8. Financial Statements and Supplementary Data of the
Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
 Multi-family
Securitization Trusts. In 2024, the Company completed a multi-family securitization. The Company has determined that it is not the primary beneficiary of the multi-family securitization trusts since it does not have the power to direct the
activities that would have the most significant impact on their economic performance. The Company’s maximum exposure related to the multi-family securitization trusts is $36.4 million, which represents its obligation to Freddie Mac to
guarantee losses up to 12% of the aggregate UPB of the loans at the time of sale. The obligation is secured in full by an irrevocable letter of credit issued by the FHLB. Additional information regarding this multi-family securitization can be found
within Note 2: Business Developments in the Notes to Consolidated Financial Statements contained in Part II - Item 8. Financial Statements and Supplementary Data of the Company’s Annual Report on Form
 10-K for the year ended December 31, 2025.
 Joint Venture with Marathon Asset Management .
 The Company, through its subsidiary MW Advisor Holding, LLC, owns a 50 percent interest in both MW Advisor, LLC and Marathon Direct Lending SLP, LLC. The Company (i) will receive a management fee for investment advisory and other
related services performed by MW Advisor, LLC on behalf of a certain investment fund formed in connection with the joint venture (the “Fund”), and (ii) may be entitled to receive certain special limited partner carried interest
distributions through its interest in Marathon Direct Lending SLP, LLC, as the designated special limited partner of the Fund. The Company has determined that it is not the primary beneficiary of either MW Advisor, LLC, Marathon Direct Lending SLP,
LLC, or the Fund since it does not have the power to make decisions or control the activities that would most significantly affect their economic performance.

 The carrying value of the Company’s investment in MW Advisor, LLC and Marathon Direct Lending SLP, LLC, which is included in Accrued interest receivable
and other assets on the accompanying Condensed Consolidated Balance Sheets, was not significant at March 31, 2026, and at December 31, 2025, and its maximum exposure to loss is equal to the carrying value plus contractual obligations to
provide capital contributions in the future, if any, which also is not significant.
 Other Non-Marketable
Investments. The Company invests in alternative investments comprising interests in non-public entities that cannot be redeemed since the investment is distributed as the underlying equity is
liquidated. The ultimate timing and amount of these distributions cannot be predicted with reasonable certainty. For each of these alternative investments that is classified as a VIE, the Company has determined that it is not the primary beneficiary
due to its inability to direct the activities that most significantly impact economic performance. The aggregate carrying value of the Company’s other non-marketable investments was $278.6 million
at March 31, 2026, and $271.1 million at December 31, 2025, which is included in Accrued interest receivable and other assets on the accompanying Condensed Consolidated Balance Sheets, and its maximum exposure to loss, including
unfunded commitments, was $404.8 million and $401.2 million, respectively. Additional information regarding other non-marketable investments can be found within Note 14: Fair Value Measurements.

 31

 Note 12: Earnings Per Common Share

 The following table summarizes the calculation of basic and diluted earnings per common share:

    Three months ended March 31,   

 (In thousands, except per share data)

 2026

 2025

 Net income

 $
 246,231 

 $
 226,917 

 Less: Preferred stock dividends

 4,163 

 4,163 

 Income allocated to participating securities

 2,794 

 2,387 

 Net income applicable to common stockholders

 $
 239,274 

 $
 220,367 

 Weighted-average common shares outstanding - basic

 159,534 

 169,182 

 Add: Effect of dilutive stock options and restricted stock

 316 

 362 

 Weighted-average common shares - diluted

 159,850 

 169,544 

 Earnings per common share - basic

 $
 1.50 

 $
 1.30 

 Earnings per common share - diluted

 1.50 

 1.30 

 Earnings per common share is calculated under the two-class method in which all
earnings, distributed and undistributed, are allocated to common stock and participating securities based on their respective rights to receive dividends. The Company may provide for the grant of stock options, stock appreciation rights, restricted
stock, performance-based stock, and stock units to eligible employees and directors under its stock incentive plan. Holders of restricted stock are entitled to receive non-forfeitable dividends during the
vesting period on a basis equivalent to the dividends paid to holders of common stock. These unvested awards meet the definition of participating securities.

 Potential common shares from performance-based restricted stock that were not included in the computation of diluted earnings per common share because they were
anti-dilutive under the treasury stock method were zero for the three months ended March 31, 2026, and 46,900 for the three months ended March 31, 2025. Additional information regarding the issuance of stock awards under the
Company’s stock incentive plan can be found within Note 19: Stock-Based Compensation Plans in the Notes to Consolidated Financial Statements contained in Part II - Item 8. Financial Statements and Supplementary Data of the Company’s
Annual Report on Form 10-K for the year ended December 31, 2025.

 32

 Note 13: Derivative Financial Instruments

 Derivative Positions and Offsetting
 Derivatives
Designated in Hedge Relationships . Interest rate swaps allow the Company to change the fixed or variable nature of an interest rate without the exchange of the underlying notional amount. Certain pay fixed/receive variable interest rate
swaps are designated as cash flow hedges to effectively convert variable-rate debt into fixed-rate debt, whereas certain receive fixed/pay variable interest rate swaps are designated as fair value hedges to effectively convert fixed-rate debt into
variable-rate debt. Certain purchased options are also designated as cash flow hedges, allowing the Company to limit the potential adverse impact of variable interest rates by establishing a cap rate or floor rate in exchange for an upfront premium.
The purchased options designated as cash flow hedges represent interest rate caps where payment is received from the counterparty if interest rates rise above the cap rate, and interest rate floors where payment is received from the counterparty
when interest rates fall below the floor rate. The maximum length of time over which forecasted transactions are hedged is 2.3 years.
 Derivatives Not
Designated in Hedge Relationships. The Company also enters into derivative transactions that are not designated in hedge relationships. The Company has a
 back-to-back swap program, whereby it enters into an interest rate swap with a qualified customer and simultaneously enters into an equal and opposite interest rate swap
with a swap counterparty, to hedge interest rate risk. Derivative assets and derivative liabilities with the same counterparty are presented on a net basis when master netting agreements are in place.

 The following tables present the notional amounts and fair values, including accrued interest, of derivative positions:

 March 31, 2026

 Asset Derivatives

 Liability Derivatives

 (In thousands)

   Notional Amounts  

     Fair Value    

   Notional Amounts  

     Fair Value    

 Designated in hedge relationships:

 Interest rate derivatives (1)

 $
 2,750,000

 $
 3,145 

 $
 2,750,000

 $
 1,414 

 Not designated in hedge relationships:

 Interest rate derivatives (1)

 10,022,504

 199,980 

 9,977,467

 199,718 

 Mortgage banking derivatives

 811

 10 

 —

 — 

 Other (2)

 300,604

 442 

 1,069,582

 537 

 Total not designated in hedge relationships

 10,323,919

 200,432 

 11,047,049

 200,255 

 Gross derivative financial instruments, before netting

 $
 13,073,919

 203,577 

 $
 13,797,049

 201,669 

 Less: Master netting agreements

 39,145 

 39,145 

 Cash collateral pledged

 120,487 

 6,040 

 Total derivative financial instruments, after netting

 $
 43,945 

 $
 156,484 

 December 31, 2025

 Asset Derivatives

 Liability Derivatives

 (In thousands)

 Notional Amounts

 Fair Value

 Notional Amounts

 Fair Value

 Designated in hedge relationships:

 Interest rate derivatives (1)

 $
 4,500,000

 $
 6,258 

 $
 500,000

 $
 403 

 Not designated in hedge relationships:

 Interest rate derivatives (1)

 9,989,160

 223,685 

 9,989,160

 222,794 

 Mortgage banking derivatives

 4,032

 67 

 —

 — 

 Other (2)

 412,075

 191 

 1,014,621

 517 

 Total not designated in hedge relationships

 10,405,267

 223,943 

 11,003,781

 223,311 

 Gross derivative financial instruments, before netting

 $
 14,905,267

 230,201 

 $
 11,503,781

 223,714 

 Less: Master netting agreements

 65,063 

 65,063 

 Cash collateral pledged

 84,056 

 12,053 

 Total derivative financial instruments, after netting

 $
 81,082 

 $
 146,598 

 (1)
 The notional amounts of interest rate swaps that were centrally-cleared through clearing houses was
$191.9 million at March 31, 2026, and $65.3 million at December 31, 2025, for asset derivatives, and $1.2 million at March 31, 2026, and $126.5 million at December 31, 2025, for liability derivatives. Interest
rate swaps that are centrally-cleared through clearing houses are “settled-to-market” and considered a single unit of account. In accordance with their rule
books, clearing houses record the variation margin transferred for settled-to-market derivatives as a legal settlement of the derivative contract (i.e., the variation
margin legally settles the outstanding exposure, but does not result in any other change or reset of the contractual terms of the derivative). The fair values of the Company’s
 settled-to-market interest rate swaps are presented net on the accompanying Condensed Consolidated Balance Sheets and approximated zero at March 31, 2026, and at
December 31, 2025.

 (2)
 Other derivatives not designated in hedge relationships included foreign currency forward contracts related to
lending arrangements, a Visa equity swap transaction, and risk participation agreements. The notional amount of risk participation agreements was $255.0 million at March 31, 2026, and $370.1 million at December 31, 2025, for
asset derivatives, and $1.0 billion at March 31, 2026, and $965.4 million at December 31, 2025, for liability derivatives, all of which had immaterial related fair values.

 33

 The following tables represent the offsetting of derivative financial instruments that are subject to master
netting agreements:

 March 31, 2026

 Gross Amounts Not Offset in the

 Statement of Financial Position

   Gross Amounts of  

 Recognized

 Assets/Liabilities

   Gross Amounts  
Offset in the
Statement of
Financial Position

   Net Amounts of  

 Assets/Liabilities
Presented in the
Statement of
Financial Position

 (In thousands)

 Financial
  Instruments  

  Cash Collateral 

 Pledged

   Net Amount  

 Asset derivatives

 $
 159,632

 $
 39,145

 $
 120,487

 $
 —

 $
 120,487

 $
 — 

 Liability derivatives

 45,917

 39,145

 6,772

 —

 6,040

 732 

 December 31, 2025

 Gross Amounts Not Offset in the

 Statement of Financial Position

 Gross Amounts of
Recognized

 Assets/Liabilities

 Gross Amounts
Offset in the
Statement of
Financial Position

 Net Amounts of
Assets/Liabilities
Presented in the
Statement of
Financial Position

 (In thousands)

 Financial
Instruments

 Cash Collateral
Pledged

 Net Amount

 Asset derivatives

 $
 153,854

 $
 65,063

 $
 88,791

 $
 —

 $
 84,056

 $
 4,735 

 Liability derivatives

 77,167

 65,063

 12,104

 —

 12,053

 51 

 Derivative Activity
 The
following table summarizes the income statement effect of derivatives designated in hedge relationships:

 Recognized in

 Net Interest Income

    

 Three months ended March 31,

 (In thousands)

     2026    

     2025    

 Cash flow hedges:

 Interest rate derivatives (1)

 Interest and fees on loans and leases

 $
 336

 $
 (3,255) 

 (1)
 Additional information regarding the amounts recognized in net income related to cash flow hedge activities can
be found within Note 9: Accumulated Other Comprehensive (Loss), Net of Tax.

 The following table summarizes the income statement effect of
derivatives not designated in hedge relationships:

 Recognized in

     Non-interest Income    

 Three months ended March 31,

 (In thousands)

    

     2026    

     2025    

 Interest rate derivatives

 Other income

 $
 3,864 

 $
 (2,824)

 Mortgage banking derivatives

 Other income

 (57)

 (13)

 Other

 Other income

 (885)

 (987)

 Total not designated in hedge relationships

 $
 2,922 

 $
 (3,824)

 Derivative Exposure. At March 31, 2026, the Company had $132.8 million of cash collateral
received and $6.0 million of cash collateral posted included in Cash and due from banks on the accompanying Condensed Consolidated Balance Sheets. In addition, at March 31, 2026, the Company had $3.4 million in initial margin posted
at clearing houses, which is included in Accrued interest receivable and other assets on the accompanying Condensed Consolidated Balance Sheets. The Company regularly evaluates the credit risk of its derivative customers, taking into account the
likelihood of default, net exposures, and remaining contractual life, among other related factors. Credit risk exposure is mitigated as transactions with customers are generally secured by the same collateral of the underlying transactions. The
current net credit exposure relating to customer derivatives was $43.9 million at March 31, 2026. The Company also monitors potential future exposure, which represents its best estimate of exposure to remaining contractual maturity. The
potential future exposure relating to customer derivatives was $122.3 million at March 31, 2026. The Company has incorporated a credit valuation adjustment to reflect non-performance risk in the fair
value measurement of its derivative financial instruments, which totaled $4.4 million at March 31, 2026, and $4.2 million at December 31, 2025. Various factors impact the change in the credit valuation adjustment over time, such
as changes in the credit spreads of the contracted parties, and changes in market rates and volatilities, which can affect the total expected exposure of the derivative financial instruments.

 Additional information regarding the Company’s accounting policies for derivative financial instruments can be found within Note 1: Summary of Significant
Accounting Policies in the Notes to Consolidated Financial Statements contained in Part II - Item 8. Financial Statements and Supplementary Data of the Company’s Annual Report on Form 10-K for the year
ended December 31, 2025.

 34

 Note 14: Fair Value Measurements

 Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants
at the measurement date. The determination of fair value may require the use of estimates when quoted market prices are not available. Fair value estimates made at a specific point in time are based on management’s judgments regarding future
expected losses, current economic conditions, the risk characteristics of each financial instrument, and other subjective factors that cannot be determined with precision.

 The framework for measuring fair value provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure value. The hierarchy
gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels within the fair value hierarchy are as follows:

 •

 Level 1: Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities
in active markets that the Company has the ability to access at the measurement date.

 •

 Level 2: Inputs to the valuation methodology include quoted prices for similar assets or liabilities in
active markets, quoted prices for identical or similar assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, rate volatility, prepayment speeds, and credit
ratings), or inputs that are derived principally from or corroborated by market data, correlation, or other means.

 •

 Level 3: Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
This includes certain pricing models or other similar techniques that require significant management judgment or estimation.

 Assets
and Liabilities Measured at Fair Value on a Recurring Basis

 Available-for-Sale Securities. When unadjusted quoted prices are
available in an active market, the Company classifies its available-for-sale securities within Level 1 of the fair value hierarchy. When quoted market prices are
not available, the Company employs an independent pricing service that utilizes matrix pricing to calculate fair value. These fair value measurements consider observable data, such as dealer quotes, market spreads, cash flows, yield curves, live
trading levels, trade execution data, market consensus prepayment speeds, credit information, and the respective terms and conditions of debt instruments. Management maintains procedures to monitor the pricing service’s results and has a
process in place to challenge their valuations and methodologies. Government agency debentures, Agency CMO, Agency MBS, Agency CMBS, Municipal bonds and notes, CMBS, Corporate debt, Private label MBS, and Other available-for-sale securities are classified within Level 2 of the fair value hierarchy.
 Derivative
Financial Instruments. The fair values presented for derivative financial instruments include any accrued interest. Foreign exchange contracts are valued based on unadjusted quoted prices in active markets and, accordingly, are classified
within Level 1 of the fair value hierarchy. Except for mortgage banking derivatives, all other derivative financial instruments are valued using third-party valuation software, which considers the present value of cash flows discounted using
observable forward rate assumptions. The resulting fair value is then validated against valuations performed by dealer counterparties. Credit valuation adjustments, which are included in the fair value of derivative financial instruments, utilize
Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by its counterparties. When credit valuation adjustments are significant to the overall fair value of a derivative financial instrument, the
Company classifies that derivative financial instrument in Level 3 of the fair value hierarchy. Otherwise, derivative financial instruments are generally classified within Level 2 of the fair value hierarchy. The Company’s credit
valuation adjustments were not considered significant to the overall fair value of its derivative financial instruments at March 31, 2026, and at December 31, 2025.

 Mortgage Banking Derivatives. The Company uses forward sales of mortgage loans and mortgage-backed securities to manage the risk of loss
associated with its mortgage loan commitments and mortgage loans held for sale. Prior to closing and funding certain single-family residential mortgage loans, an interest rate lock commitment is generally extended to the borrower. During this in-between time period, the Company is subject to the risk that market interest rates may change. If rates rise, investors generally will pay less to purchase mortgage loans, which would result in a reduction in the
gain on sale of the loans, or possibly a loss. In an effort to mitigate this risk, forward delivery sales commitments are established in which the Company agrees to either deliver whole mortgage loans to various investors or issue mortgage-backed
securities. The fair value of mortgage banking derivatives is determined based on current market prices for similar assets in the secondary market. Accordingly, mortgage banking derivatives are classified within Level 2 of the fair value
hierarchy.
 Loans Originated for Sale . The Company has elected to measure residential mortgage loans originated for sale at fair value
under the fair value option per ASC Topic 825, Financial Instruments. Electing to measure residential mortgage loans originated for sale at fair value reduces certain timing differences and better reflects the price the Company would expect to
receive from the sale of these loans. The fair value of residential mortgage loans originated for sale is based on quoted market prices of similar loans sold in conjunction with securitization transactions. Accordingly, residential mortgage loans
originated for sale are classified within Level 2 of the fair value hierarchy.

 35

 The following table compares the fair value to the UPB of residential mortgage loans originated for sale:

 March 31, 2026

 December 31, 2025

 (In thousands)

     Fair Value

     UPB

     Difference

     Fair Value

     UPB

     Difference

 Originated loans held for sale

 $
 1,734

 $
 1,752

 $
 (18)

 $
 2,142

 $
 2,068

 $
 74

 Rabbi Trust Investments. Investments held in the Company’s Rabbi Trusts that are reported at fair
value consist primarily of mutual funds that invest in equity and fixed income securities. Shares of these mutual funds are valued based on the NAV as reported by the trustee of the funds, which represents quoted prices in active markets.
Accordingly, these investments are classified within Level 1 of the fair value hierarchy. The total cost basis of the investments held in the Company’s Rabbi Trusts that are reported at fair value was $11.3 million at March 31,
2026, and $11.2 million at December 31, 2025.
 Alternative Investments. Equity investments have a readily determinable fair value
when unadjusted quoted prices are available in an active market for identical assets. Accordingly, these alternative investments are classified within Level 1 of the fair value hierarchy. The Company did not have any equity investments with a
readily determinable fair value at March 31, 2026, and at December 31, 2025.
 Equity investments that do not have a readily determinable fair
value may qualify for the NAV practical expedient if they meet certain requirements. The Company’s alternative investments measured at NAV consist of investments in non-public entities that cannot be
redeemed since investments are distributed as the underlying equity is liquidated. Alternative investments measured at NAV are not classified within the fair value hierarchy. The Company’s alternative investments measured at NAV had a total
carrying amount of $62.0 million at March 31, 2026, and $57.5 million at December 31, 2025, and a total remaining unfunded commitment of $53.1 million and $52.2 million, respectively.

 Contingent Consideration. The Company recorded contingent consideration at fair value related to one
 earn-out agreement associated with the SecureSave acquisition completed in December 2025. The earn-out is based on total program deposits measured as of three future
measurement dates, with a payment due only if total program deposits exceed the program deposit threshold and, if so, (i) equal to total program deposits multiplied by the applicable earn-out rate for the
measurement dates on December 31, 2026, and December 31, 2027, and (ii) equal to the total program deposits in excess of the program deposit threshold multiplied by the earn-out rate for the
measurement date on December 31, 2028. The contingent consideration is payable in cash up to an aggregate maximum of $35.0 million.
 The
following tables summarize the significant inputs used to derive the estimated fair value of the Company’s contingent consideration liabilities associated with the SecureSave acquisition (dollars in thousands):

 March 31, 2026

 Contractual Inputs

 Unobservable Inputs

 Measurement Date

 Program

 Deposit

  Threshold 

 Earn-Out Rate

 Aggregate

 Maximum
  Earn-Out 

 Projected

 Program

 Deposits

 Discount Factor

 on Projected

 Program

 Deposits

 Deposit Volatility

 Payout Present

 Value Factor

  Fair Value 

 December 31, 2026

 $
 145,000

 1.0 %

 $
 35,000

 $
 64,037

 0.94

 14.0 %

 0.95

 $
 — 

 December 31, 2027

 402,500

 1.5   

 35,000

 406,931

 0.83

 14.0   

 0.91

 1,163 

 December 31, 2028

 681,000

 5.0   

 35,000

 1,034,752

 0.71

 14.0   

 0.86

 6,027 

 December 31, 2025

 Contractual Inputs

 Unobservable Inputs

 Measurement Date

 Program

 Deposit

 Threshold

 Earn-Out Rate

 Aggregate

 Maximum
   Earn-Out  

 Projected

 Program

   Deposits  

 Discount Factor

 on Projected

 Program

 Deposits

 Deposit Volatility

 Payout Present

 Value Factor

  Fair Value 

 December 31, 2026

 $
 145,000

 1.0 %

 $
 35,000

 $
 146,700

 0.92

 14.0 %

 0.94

 $
 417 

 December 31, 2027

 402,500

 1.5   

 35,000

 485,405

 0.79

 14.0   

 0.90

 2,998 

 December 31, 2028

 681,000

 5.0   

 35,000

 1,034,752

 0.68

 14.0   

 0.86

 5,005 

 The estimated fair value of the SecureSave contingent consideration liability is measured on a recurring basis and d…

EX-99.3 · d151630dex993.htm

EX-99.3
 5
 d151630dex993.htm
 EX-99.3

 Exhibit 99.3

 UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

 The following unaudited pro forma condensed combined financial information and related notes are based on and should be read in conjunction with:

 a.
 the historical audited consolidated financial statements of Santander Holdings USA, Inc. (“SHUSA” or
the “Company”) and the related notes, and Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in the Company’s Annual Report on Form 10-K for
the fiscal year ended December 31, 2025 filed on March 2, 2026;

 b.
 the historical unaudited condensed consolidated financial statements of the Company and the related notes, and
Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in the Company’s Quarterly Report on Form 10-Q for the three-month period ended March 31, 2026
filed on May 4, 2026;

 c.
 the historical audited consolidated financial statements of Webster Financial Corporation
(“Webster”) and the related notes, included as Exhibit 99.1 to the Form 8-K to which this exhibit is attached; and

 d.
 the historical unaudited condensed consolidated financial statements of Webster and the related notes, included
as Exhibit 99.2 to the Form 8-K to which this exhibit is attached.

 The unaudited pro forma
condensed combined financial information combines the historical consolidated financial position and results of operations of the Company and Webster as a result of the acquisition of Webster by Banco Santander, S.A. (“Santander”) and
the contribution of Webster to SHUSA by Santander in exchange for no consideration and the subsequent merger of Webster with and into the Company. It is provided for illustrative information purposes only and has been derived from the historical
consolidated financial statements of the Company and Webster, and is presented based on available information and certain assumptions that management believes are reasonable. The unaudited pro forma condensed combined financial information is not
necessarily, and should not be assumed to be, an indication of the actual results that would have been achieved had the transactions among Webster, Santander, and their respective subsidiaries more fully described in the Form 8-K the Company filed
with the Securities and Exchange Commission on March 31, 2026 (collectively, the “Transaction”) been completed as of the dates indicated or that may be achieved in the future. The pro forma condensed combined financial information has
been prepared by the Company in accordance with Regulation S-X Article 11, Pro Forma Financial Information, as amended by the final rule, Amendments to Financial Disclosures About Acquired and Disposed
Businesses, as adopted by the SEC on May 21, 2020.
 The unaudited pro forma condensed combined consolidated income statements for the three-month
period ended March 31, 2026 and the year ended December 31, 2025 have been prepared with the assumption that the Transaction was completed as of January 1, 2025. The unaudited pro forma condensed combined balance sheet as of
March 31, 2026 has been prepared with the assumption that the Transaction was completed as of that date.

 SANTANDER HOLDINGS USA, INC. AND SUBSIDIARIES

 PRO FORMA CONDENSED COMBINED BALANCE SHEET

 Unaudited (In thousands)

 SHUSA
Historical as of

 Webster
Historical as of

 Pro Forma
Adjustments

 Note 4

 Pro Forma as of

 March 31, 2026

 March 31, 2026

 March 31, 2026

 ASSETS

 Cash and cash equivalents

 $
 15,378,595

 $
 2,825,456

 $
 — 

 $
 18,204,051

 Federal funds sold and securities purchased under resale agreements or similar
arrangements

 9,076,054

 — 

 — 

 9,076,054

 Investment securities

 40,298,809

 18,851,637

 (801,090
 )

 (a)

 58,349,356

 Loans held for investment (LHFI)

 83,281,327

 57,248,542

 (895,125
 )

 (b)

 139,634,744

 ALLL

 (5,954,321
 )

 (733,434
 )

 (128,600
 )

 (c)

 (6,816,355
 )

 Net LHFI

 77,327,006

 56,515,108

 (1,023,725
 )

 132,818,389

 LHFS

 1,617,810

 14,478

 — 

 1,632,288

 Premises and equipment, net

 916,072

 258,435

 — 

 1,174,507

 Operating lease assets, net

 7,253,905

 — 

 — 

 7,253,905

 Goodwill

 2,766,665

 2,898,463

 2,885,119

 (d)

 8,550,247

 Intangible assets, net

 207,864

 299,518

 1,611,675

 (e)

 2,119,057

 BOLI

 2,055,523

 1,292,770

 — 

 3,348,293

 Restricted cash (1)

 6,094,527

 34,708

 — 

 6,129,235

 Other assets (2)

 5,095,351

 2,594,015

 75,202

 (f)

 7,764,568

 TOTAL ASSETS

 $
 168,088,181

 $
 85,584,588

 $
 2,747,181

 $
 256,419,950

 LIABILITIES

 Deposits and other customer accounts

 $
 81,207,311

 $
 69,039,716

 $
 (14,960
 )

 (g)

 $
 150,232,067

 Federal funds purchased and securities loaned or sold under repurchase agreements

 21,305,562

 69,756

 — 

 21,375,318

 Trading liabilities

 3,609,135

 — 

 — 

 3,609,135

 Borrowings and other debt obligations

 35,367,551

 5,548,931

 (6,523
 )

 (h)

 40,909,959

 Accounts payable, accrued expenses, and other liabilities

 8,344,729

 1,352,536

 — 

 9,697,265

 TOTAL LIABILITIES

 $
 149,834,288

 $
 76,010,939

 $
 (21,483
 )

 $
 225,823,744

 MEZZANINE EQUITY

 Preferred stock (no par value; 2,000,000 shares outstanding)

 2,000,000

 — 

 — 

 2,000,000

 STOCKHOLDER’S EQUITY

 Preferred stock

 $
 — 

 $
 283,979

 $
 — 

 (k)

 $
 283,979

 Common stock and paid-in capital

 17,289,649

 6,135,009

 5,923,325

 (i)

 29,347,983

 Treasury stock

 — 

 (1,069,828
 )

 1,069,828

 (j)

 — 

 Accumulated other comprehensive loss, net of tax

 (576,548
 )

 (430,549
 )

 430,549

 (j)

 (576,548
 )

 (Accumulated deficit) / retained earnings

 (459,208
 )

 4,655,038

 (4,655,038
 )

 (j)

 (459,208
 )

 TOTAL STOCKHOLDER’S EQUITY

 16,253,893

 9,573,649

 2,768,664

 28,596,206

 TOTAL LIABILITIES, MEZZANINE AND STOCKHOLDER’S EQUITY

 $
 168,088,181

 $
 85,584,588

 $
 2,747,181

 $
 256,419,950

 (1)
 Includes $29.6 million of restricted cash that was included in Webster’s historical Cash and due from
banks and $5.1 million of restricted cash that was included in Webster’s Interest-bearing deposits.

 (2)
 Includes $169.7 million of
 right-of-use assets that was included in Webster’s historical Premises and equipment, net.

 See accompanying notes to unaudited pro forma condensed combined financial statements.

 SANTANDER HOLDINGS USA, INC. AND SUBSIDIARIES

 PRO FORMA CONDENSED COMBINED INCOME STATEMENT

 Unaudited (In thousands)

 SHUSA
Historical for
the three
months ended

 Webster
Historical

 for the three
months ended

 Pro Forma
Adjustments

 Note 5

 Pro Forma for
the three months
ended

 March 31, 2026

 March 31, 2026

 March 31, 2026

 INTEREST INCOME:

 Loans

 $
 1,993,787

 $
 776,628

 $
 39,741

 (a)

 $
 2,810,156

 Interest-earning deposits

 162,760

 20,054

 — 

 182,814

 Interest and fees on federal funds sold and securities purchased under resale agreements or similar
arrangements

 310,053

 — 

 — 

 310,053

 Investment securities

 423,943

 197,597

 26,284

 (b)

 647,824

 TOTAL INTEREST INCOME

 2,890,543

 994,279

 66,025

 3,950,847

 INTEREST EXPENSE:

 Deposits and other customer accounts

 441,277

 316,624

 642

 (c)

 758,543

 Interest expense on federal funds purchased and securities loaned or sold under repurchase
agreements

 429,496

 1,062

 — 

 430,558

 Interest expense on trading liabilities

 43,477

 — 

 — 

 43,477

 Borrowings and other debt obligations

 481,025

 42,190

 186

 (d)

 523,401

 TOTAL INTEREST EXPENSE

 1,395,275

 359,876

 828

 1,755,979

 NET INTEREST INCOME

 1,495,268

 634,403

 65,197

 2,194,868

 Credit loss expense

 431,342

 54,000

 — 

 485,342

 NET INTEREST INCOME AFTER CREDIT LOSS EXPENSE

 1,063,926

 580,403

 65,197

 1,709,526

 NON-INTEREST INCOME:

 Consumer and commercial fees

 123,710

 56,929

 — 

 180,639

 Capital markets and foreign exchange income

 170,581

 — 

 — 

 170,581

 Lease income

 321,221

 — 

 — 

 321,221

 Miscellaneous income, net

 161,822

 44,534

 — 

 206,356

 TOTAL FEES AND OTHER INCOME

 777,334

 101,463

 — 

 878,797

 Securities gains, net

 26,480

 — 

 — 

 26,480

 TOTAL NON-INTEREST INCOME

 803,814

 101,463

 — 

 905,277

 GENERAL, ADMINISTRATIVE AND OTHER EXPENSES:

 Compensation and benefits

 544,323

 222,906

 — 

 (f)

 767,229

 Occupancy and equipment expenses

 161,798

 19,486

 — 

 181,284

 Technology, outside service and marketing expense

 215,612

 76,872

 — 

 292,484

 Loan expense (1)

 83,722

 6,175

 — 

 89,897

 Lease expense

 287,480

 — 

 — 

 287,480

 Other expenses

 92,003

 53,670

 46,637

 (e)

 192,310

 TOTAL GENERAL, ADMINISTRATIVE AND OTHER EXPENSES

 1,384,938

 379,109

 46,637

 1,810,684

 INCOME BEFORE INCOME TAX

 482,802

 302,757

 18,560

 804,119

 Income tax provision

 68,631

 56,526

 4,826

 (g)

 129,983

 NET INCOME

 $
 414,171

 $
 246,231

 $
 13,734

 $
 674,136

 (1)
 Includes $6.2 million of loan expense that was included in Webster’s historical Other expenses.

 See accompanying notes to unaudited pro forma condensed combined financial statements.

 SANTANDER HOLDINGS USA, INC. AND SUBSIDIARIES

 PRO FORMA CONDENSED COMBINED INCOME STATEMENT

 Unaudited (In thousands)

 SHUSA
 Historical for
the year ended
 December 31, 2025

 Webster
 Historical for
the year ended
 December 31, 2025

 Pro Forma
Adjustments

 Note 5

 Pro Forma for
the year ended
 December 31, 2025

 INTEREST INCOME:

 Loans

 $
 8,356,608

 $
 3,122,773

 $
 171,564

 (a
 )

 $
 11,650,945

 Interest-earning deposits

 920,487

 87,870

 — 

 1,008,357

 Interest and fees on federal funds sold and securities purchased under resale agreements or similar
arrangements

 1,679,483

 — 

 — 

 1,679,483

 Investment securities

 1,480,080

 810,865

 123,847

 (b
 )

 2,414,792

 TOTAL INTEREST INCOME

 12,436,658

 4,021,508

 295,411

 16,753,577

 INTEREST EXPENSE:

 Deposits and other customer accounts

 1,880,013

 1,365,703

 9,312

 (c
 )

 3,255,028

 Interest expense on federal funds purchased and securities loaned or sold under repurchase
agreements

 2,210,270

 3,298

 — 

 2,213,568

 Interest expense on trading liabilities

 150,517

 — 

 — 

 150,517

 Borrowings and other debt obligations

 2,242,993

 154,613

 746

 (d
 )

 2,398,352

 TOTAL INTEREST EXPENSE

 6,483,793

 1,523,614

 10,058

 8,017,465

 NET INTEREST INCOME

 5,952,865

 2,497,894

 285,353

 8,736,112

 Credit loss expense

 1,655,924

 210,000

 — 

 1,865,924

 NET INTEREST INCOME AFTER CREDIT LOSS EXPENSE

 4,296,941

 2,287,894

 285,353

 6,870,188

 NON-INTEREST INCOME:

 Consumer and commercial fees

 487,095

 228,583

 — 

 715,678

 Capital markets and foreign exchange income

 494,289

 — 

 — 

 494,289

 Lease income

 1,631,032

 — 

 — 

 1,631,032

 Miscellaneous income, net

 713,902

 172,716

 — 

 886,618

 TOTAL FEES AND OTHER INCOME

 3,326,318

 401,299

 — 

 3,727,617

 Securities gains, net

 154,705

 220

 — 

 154,925

 TOTAL NON-INTEREST INCOME

 3,481,023

 401,519

 — 

 3,882,542

 GENERAL, ADMINISTRATIVE AND OTHER EXPENSES:

 Compensation and benefits

 2,138,311

 821,748

 27,539

 (f
 )

 2,987,598

 Occupancy and equipment expenses

 725,848

 77,416

 — 

 803,264

 Technology, outside service and marketing expense

 867,340

 286,794

 — 

 1,154,134

 Loan expense (1)

 355,169

 32,365

 — 

 387,534

 Lease expense

 1,312,792

 — 

 — 

 1,312,792

 Other expenses

 536,973

 210,941

 186,548

 (e
 )

 934,462

 TOTAL GENERAL, ADMINISTRATIVE AND OTHER EXPENSES

 5,936,433

 1,429,264

 214,087

 7,579,784

 INCOME BEFORE INCOME TAX

 1,841,531

 1,260,149

 71,266

 3,172,946

 Income tax provision

 196,373

 257,347

 18,529

 (g
 )

 472,249

 NET INCOME

 $
 1,645,158

 $
 1,002,802

 $
 52,737

 $
 2,700,697

 (1)
 Includes $32.4 million of loan expense that was included in Webster historical Other expenses.

 See accompanying notes to unaudited pro forma condensed combined financial statements.

 NOTES TO THE PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

 Note 1: Basis of Presentation
 The accompanying unaudited
pro forma condensed combined financial information and related notes have been prepared in accordance with Article 11 of Regulation S-X, Pro Forma Financial Information, as amended by the final rule,
Amendments to Financial Disclosures About Acquired and Disposed Businesses, as adopted by the SEC on May 21, 2020.
 Certain reclassifications were made to
align accounting policies and financial statement presentation. The review of Webster’s accounting policies and financial statement presentation is preliminary, and additional differences could be identified prior to or at the completion of
the Transaction. Based on the preliminary review of Webster’s accounting policies, there were no material accounting policy differences identified.

 The unaudited pro forma condensed combined financial statements have been prepared to illustrate the effects of the Transaction under the acquisition method of
accounting under the provisions of Accounting Standards Codification (“ASC”) Topic 805, Business Combinations. As described in the Prior Form 8-K, Santander is the acquirer of Webster. Santander
will transfer its investment in Webster to the Company in the form of a capital contribution, and the Company will record the assets acquired and liabilities assumed at Santander’s carrying value, which will equal their estimated fair value as
of the acquisition date. The fair value concepts applied are consistent with ASC Topic 820, Fair Value Measurement.
 Transaction costs associated with the
Transaction are expected to be expensed as incurred by Santander and are not expected to be charged to the Company. Any excess of the purchase consideration over the estimated fair value of net assets acquired will be allocated to goodwill.

 The pro forma allocation of the purchase price is based on preliminary estimates and assumptions and is subject to change. The Company has not completed the
valuation analysis necessary to finalize the fair value estimates of Webster’s assets and liabilities. Preliminary estimates have been developed for certain intangible assets and select financial assets and liabilities. Other assets and
liabilities are presented at their historical carrying amounts and should be considered preliminary. The final allocation of the purchase price will be completed by Santander within the 12-month measurement
period following the acquisition date, in accordance with ASC Topic 805. A final determination of fair values will be based on Webster’s actual assets and liabilities as of the closing date of the Transaction and may differ materially from the
preliminary estimates presented herein.
 The unaudited pro forma condensed combined balance sheet as of March 31, 2026 combines the historical
consolidated balance sheets of the Company and Webster, giving effect to the Transaction as if it had been completed on the March 31, 2026. The unaudited pro forma condensed combined income statements for the three months ended March 31,
2026 and for the year ended December 31, 2025 combine the historical consolidated income statements of the Company and Webster, giving effect to the Transaction as if it had been completed on January 1, 2025.

 The unaudited pro forma condensed combined financial information is presented for illustrative purposes only and is not necessarily indicative of the financial
position or results of operations that would have been achieved had the Transaction been completed on the dates indicated, nor is it indicative of future results or financial position of the Company following the Transaction.

 The pro forma financial information included herein does not reflect the issuance or maintenance of loss-absorbing instruments that may be required in
connection with applicable total loss-absorbing capacity requirements.

 Note 2: Preliminary Purchase Price Allocation

 The total consideration transferred by Santander to the Webster shareholders will be allocated to the identifiable assets acquired and liabilities assumed based
on their estimated fair values as of the acquisition date. The following table summarizes the preliminary estimated consideration at May 26, 2026 as described in the Schedule 14A Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 filed by Webster with the Securities and Exchange Commission on April 23, 2026. Based on that information, at the effective time of the Transaction, by virtue of the share exchange described in that proxy statement, each
outstanding share of Webster Virginia Corporation common stock will be exchanged for the right to receive (i) 2.0548 American Depositary Shares of Santander representing such ordinary shares (“ADSs”) and (ii) $48.75 in cash, without
interest.

 As of May 26, 2026

 Webster shares outstanding

 162,042,903

 Exchange ratio

 2.0548

 ADSs to be issued in the Transaction

 332,965,757

 Cash consideration per Webster share (in $)

 $
 48.75

 Cash consideration ($ in thousands)

 $
 7,899,592

 Relative per share value of ADSs based on closing price as of May 26, 2026 (in dollars) (1)

 $
 12.49

 Estimated share consideration at May 26, 2026 ($ in thousands)

 $
 4,158,742

 Estimated total consideration ($ in thousands)

 $
 12,058,334

 (1)
 Estimated total consideration and goodwill would increase $415.9 million and decrease $(415.9) million with
a +10% / -10% change in the relative per share value of Santander ADSs, respectively.

 The following table summarizes the allocation of the preliminary estimated purchase consideration to the fair
value of identifiable tangible and intangible assets to be acquired and liabilities to be assumed as if the Transaction had been completed on March 31, 2026. The excess of Santander’s purchase price over the estimated fair value of net
assets acquired and contributed to the Company will be recorded as goodwill.

 (in thousands)

 Preliminary Balances at
 March 31, 2026

 Fair value of consideration to be transferred
 (1)

 $
 12,058,334

 Fair value of assets:

 Cash, and cash equivalents

 $
 2,825,456

 Investment securities

 18,050,547

 Loans held for investment, net

 55,491,383

 Other intangible assets

 1,911,193

 All other assets (includes $75,202 of deferred taxes on purchase accounting fair value
adjustments)

 4,269,608

 Total assets to be acquired

 $
 82,548,187

 Fair value of liabilities:

 Deposits and other customer accounts

 $
 69,024,756

 Federal funds purchased and securities loaned or sold under repurchase agreements

 69,756

 Borrowings and other debt obligations

 5,542,408

 Accounts payable, accrued expenses, and other liabilities

 1,352,536

 Total liabilities to be acquired

 $
 75,989,456

 Fair value of net assets to be acquired

 6,558,731

 Plus: Preferred stock to be acquired

 283,979

 Goodwill recognized

 $
 5,783,582

 (1)
 Estimated as of May 26, 2026

 Note 3: Identifiable Intangible Assets
 Identifiable
intangible assets are required to be measured at fair value. For purposes of these unaudited pro forma condensed combined financial statements, it is assumed that all assets will be used in a manner that represents their highest and best use.
Amounts preliminarily allocated to identifiable intangibles may change significantly, which could result in a material change in amortization of acquired intangible assets, which is on a straight-line basis. The following represents the amount and
estimated useful lives of identifiable intangible assets:

 (dollars in thousands)

 Amount

 Useful Life
(Midpoint)

 Identified intangible assets:

 Core deposit intangibles - core deposits

 $
 1,064,151

 7-10 years (8)

 Core deposit intangibles - health saving accounts

 520,302

 8-11 years (9)

 Core deposit intangibles - workers comp administration funds

 246,034

 20-30 years (25)

 Customer relationships

 80,706

 9-10 years (10)

 $
 1,911,193

 Note 4: Balance Sheet Adjustments

 The following pro forma adjustments have been reflected in the unaudited pro forma condensed combined balance sheet. All adjustments are based on preliminary
assumptions and valuations, which are subject to change.

 a.
 Fair value adjustment to
 held-to-maturity debt securities to reflect a current market rate of interest as of March 31, 2026 for similar types of securities, resulting in a net discount of
$801.1 million which will be accreted into interest income over the estimated remaining life of the held-to-maturity debt securities portfolio.

 b.
 Fair value adjustment to loans and leases to reflect a current market rate of interest for loans as of
March 31, 2026 with similar terms, resulting in a non-credit discount of $895.1 million, which will be accreted into interest income over the estimated remaining life of the loan portfolio.

 c.
 Fair value adjustment to eliminate Webster’s allowance for credit losses of $733.4 million at
March 31, 2026 and to record the Company’s preliminary estimate of credit losses for the loans to be acquired of $862.0 million. The Company adopted ASU 2025-08, Purchased Loans, and will
record its initial estimate of the allowance for credit losses using the gross-up method, resulting in an additional allowance for loan losses of $128.6 million and an increase in the cost basis of the
loans.

 d.
 Fair value adjustment to reverse Webster’s existing goodwill of $2.9 billion, and to record
preliminary estimated goodwill associated with the Transaction of $5.8 billion.

 e.
 Fair value adjustment to eliminate Webster’s core deposit and other intangibles of $299.5 million at
March 31, 2026 and record a core deposit intangible of $1.8 billion and other intangibles of $80.7 million.

 f.
 Adjustment to deferred tax assets calculated at the statutory rate in effect of 26.0% to reflect the impact of
the fair value adjustments to the assets and liabilities to be acquired.

 g.
 Fair value adjustment to time deposits calculated as the present value of contractual payments discounted at a
market rate as of March 31, 2026.

 h.
 Fair value adjustment to Federal Home Loan Bank (“FHLB”) advances and long-term debt calculated as
the present value of contractual payments discounted at a market rate as of March 31, 2026.

 i.
 Adjustment to record the capital contribution of Webster from Santander to the Company for $12.1 billion
and to eliminate the additional paid-in capital of Webster.

 j.
 Adjustment to eliminate components of Webster’s equity (common stock at par value, retained earnings,
treasury stock and accumulated other comprehensive income).

 k.
 Preferred stock reflects the conversion of Webster’s Series F and Series G Preferred Stock into a
newly-issued series of the Company’s preferred stock with substantially the same terms. The fair value of the newly-issued preferred stock of the Company is preliminarily estimated to be equivalent to the carrying value of Webster’s
preferred stock.

 The estimated amortization for the next five years for certain balance sheet adjustments is as follows:

 Fiscal Year

 ( $ in thousands)

 Identified Intangibles

 Held-to-Maturity
Investments

 Loans Held for Investment

 2026

 $
 186,548

 $
 123,847

 $
 171,564

 2027

 186,548

 105,136

 158,963

 2028

 186,548

 89,207

 144,313

 2029

 186,548

 75,672

 127,418

 2030

 186,548

 64,369

 108,068

 Note 5: Income Statement Adjustments

 The following pro forma adjustments have been reflected in the unaudited pro forma condensed combined income statement. All adjustments are based on preliminary
assumptions and valuations, which are subject to change.

 a.
 Represents the accretion of the fair value adjustment on loans into interest income over an estimated life of 6
years and an effective interest rate of 5.88%.

 b.
 Represents the accretion of the fair value adjustment on held-to-maturity debt securities into interest income over a weighted average term of 5.0 years using the effective interest method at a weighted average interest rate return of 5.18%.

 c.
 Represents the amortization of the fair value adjustment on time deposits over an estimated term of 5 years
using the effective interest method.

 d.
 Represents the amortization of the fair value adjustment on (i) FHLB advances over an estimated term of 15
years using the straight-line method and (ii) long-term debt over an estimated term of 6.8 years using the straight-line method.

 e.
 Represents the amortization of the fair value adjustment on the core deposit intangibles and customer
relationship intangibles utilizing the straight-line method. Refer to Note 3 above for estimated amortization periods.

 f.
 Represents the increased amortization expense for unvested Webster equity awards replaced with Santander ADSs
upon acquisition.

 g.
 Represents the impact of pro forma adjustments to the income tax provision calculated at the statutory rate in
effect.

EX-23.1 · d151630dex231.htm

EX-23.1
 2
 d151630dex231.htm
 EX-23.1

 Exhibit 23.1

 KPMG LLP
 Two Manhattan West

 375 9th Avenue, 17th Floor
 New York, NY 10001

 Consent of Independent Registered Public Accounting Firm

 We consent to the incorporation by reference in the registration statement (No. 333-276089) on Form S-3 of Santander USA Holdings, Inc. of our reports dated February 27, 2026, with respect to the consolidated financial statements of Webster Financial Corporation, and the effectiveness of internal control over
financial reporting, which reports appear in the Form 8-K of Santander USA Holdings, Inc. which is incorporated by reference in the prospectus supplement to be dated as of the date hereof, and to the reference
of our firm under the heading “Experts” in such prospectus supplement.

 New York, New York

 June 1, 2026

  

 KPMG LLP, a Delaware limited liability partnership, and its subsidiaries are part of

 the KPMG global organization of independent member firms affiliated with KPMG

 International Limited, a private English company limited by guarantee.