First Carolina Financial Services Reports Net Income of $5.1 Million, or $0.20 Per Diluted Share, for the Second Quarter of 2026

About this update from First Carolina Financial Services, Inc.

First Carolina Financial Services, Inc. (NYSE: FCBM) (“First Carolina,” the “Company,” “we,” “our,” or “us”), today reported net income of $5.1 million, or $0.20 per diluted share, for the second quarter of 2026, compared to $4.6 million, or $0.18 per diluted share, for the second quarter of 2025, an 11.0% increase in net income. All per share data has been adjusted to reflect the two-for-one stock split completed on June 17, 2026. The quarter marked a transformational milestone for First Carolina. On June 22, 2026, the Company successfully completed its initial public offering (the “IPO”) of 5,500,000 shares of common stock at a public offering price of $12.50 per share. First Carolina's common stock began trading on the New York Stock Exchange (“NYSE”) on June 18, 2026, under the ticker symbol “FCBM.” On June 29, 2026, the underwriters of the IPO exercised their option to purchase additional shares in full, resulting in the sale of an additional 825,000 shares of the Company’s common stock at the public offering price per share. Inclusive of the shares purchased pursuant to the underwriters' option, the Company received net proceeds of approximately $69.3 million, after deducting underwriting discounts and commissions and expenses of the offering. “The first half of 2026 was a landmark period for First Carolina as we successfully completed our initial public offering while continuing to deliver solid financial performance,” said Ron Day, Chairman, President, and Chief Executive Officer. “Our results were driven by solid loan production and net loan growth, material deposit optimization activities, expanding year-over-year net interest margin, disciplined expense management, and exceptional execution across the organization. In particular, in our traditional banking business, for the first six months of 2026, brokered deposits declined $211 million and were replaced by $246 million in less expensive, non-brokered deposits. “What continues to set First Carolina apart is the strength and diversity of our business model. Through our Commercial Banking, Payments, Consumer Banking, and Wealth Management businesses, we are well positioned to serve clients across every stage of their financial journey. Commercial loan production remains robust, with a focus on new variable-rate loan originations to replace maturing lower-yield legacy loans, and this has helped to improve the overall profitability of our balance sheet. At the same time, we are deepening relationships with commercial clients through treasury management solutions that enhance customer engagement and drive valuable operating deposit growth.” Day added, “With respect to our Payments business, we continue to strengthen our competitive position by expanding our service offerings. For example, we are partnering with U.S. Bank, a leader in prepaid card solutions, to develop a prepaid card option, which we anticipate will allow us to expand the range of disbursement choices made available to our higher-education institution clients and their students. We have successfully integrated the Payments business into First Carolina and are now focused on the broader banking opportunity across higher education as a strategic growth vertical. Demonstrating this shift, as of June 30, 2026, we have successfully placed $37 million in loan facilities and secured over $37 million in deposits from our base of higher-education institution clients, since completing our acquisition of BM Technologies, Inc. in January 2025. "We believe our diversified model will be a true differentiator, and we see emerging tailwinds that give us great confidence in our team's ability to deliver strong shareholder returns while staying grounded in our core values.” Second Quarter 2026 Performance Highlights: Net income of $5.1 million, an increase of 11.0% from the second quarter of 2025. Successfully completed the Company's IPO and NYSE listing, significantly enhancing capital flexibility and growth opportunities. Generated $58.1 million of loan growth, representing an annualized growth rate of 8.9%. Expanded net interest margin by 18 basis points on a year-over-year comparative-quarter basis to 3.23%. Increased second quarter net interest income by 8.8% year over year. Maintained exceptional credit quality with zero net loan charge-offs during the quarter. Reduced higher-cost certificates of deposit by 24.4% during the quarter and 53.5% over the past year, supporting funding cost improvements. Continued strong capital levels with average shareholders' equity representing 10.53% of average assets. Improved asset quality, with nonperforming assets declining to 0.65% of total assets compared to 0.89% a year ago. Ended the quarter with book value per share of $13.88 and tangible book value per share 1 of $11.66. Return on average assets (“ROAA”) of 0.60%. Return on average equity (“ROAE”) of 5.71%; Return on average tangible common equity (“ROATCE”) 1 of 7.09%. (1) Considered non-GAAP financial measure - See "Non-GAAP Financial Measures" and reconciliation of GAAP to non-GAAP financial measures in the financial tables section of the press release. Operating Highlights Net interest income totaled $25.6 million for the second quarter of 2026, an increase of $2.1 million, or 8.8%, over the second quarter of 2025, reflecting continued balance sheet strength and revenue generation. The Company's net interest margin was 3.23% for the second quarter of 2026, representing an 18-basis point improvement over the prior year period, driven primarily by lower interest-bearing deposit costs. Net interest margin declined modestly by two basis points from the first quarter of 2026, largely attributable to the seasonality in deposits generated by the Company’s Payments business. Noninterest-bearing deposits in the Payments business regularly decline in the second quarter of each fiscal year from the preceding first quarter period, primarily due to the educational calendar. More broadly, the Company continues to benefit from ongoing deposit repricing initiatives and a favorable shift in earning asset yields. The yield on average interest-earning assets was 5.92% for the second quarter of 2026, compared to 6.02% for the second quarter of 2025, a decrease of 10 basis points primarily reflecting lower yield on the securities portfolio and short-term, floating rate investments in a declining rate environment. The yield on average interest-earning assets increased from 5.82% in the first quarter of 2026 to 5.92% for the second quarter of 2026, primarily attributable to an improvement in loan yields, reflecting the strength of the Company's lending franchise and loan portfolio pricing, partially offset by a decline in the yield on securities available for sale. The Company delivered meaningful growth in net interest income and year-over-year expansion in net interest margin. The Company’s total cost of funds was 2.84% for the second quarter of 2026, a decrease of 30 basis points compared to the second quarter of 2025. Deposit costs were 2.75% for the second quarter of 2026, compared to 3.05% for the second quarter of 2025, a decrease of 30 basis points, and compared to 2.63% for the first quarter of 2026, an increase of 12 basis points. The cost of interest-bearing liabilities was 3.58% for the second quarter of 2026, a decrease of 42 basis points compared to 4.00% for the second quarter of 2025, and a decrease of 1 basis point compared to 3.59% for the first quarter of 2026, reflecting the strategic shift of deposits from time deposits to money market and savings accounts. Management believes the declines in total cost of funds, deposit costs, and cost of interest-bearing liabilities in the second quarter of 2026 versus the second quarter of 2025 are particularly instructive, as it eliminates the impact of the seasonality of the Payments business deposit flows, as compared to the linked-quarter comparisons. Noninterest income totaled $6.7 million for the second quarter of 2026, a decrease of $6.5 million, or 49.5%, from the second quarter of 2025. The decrease primarily reflects the planned discontinuation in 2025 of a banking-as-a-service partnership inherited through the BM Technologies’ acquisition that was not consistent with the Company's long-term strategic focus. Accordingly, results for the second quarter of 2025 are not directly comparable to those for the second quarter of 2026. Noninterest expense totaled $25.5 million for the second quarter of 2026, a decrease of $5.2 million, or 17.1%, from the second quarter of 2025. The decline was primarily driven by right sizing the BM Technologies’ workforce post acquisition, which resulted in lower salaries and employee benefits expense, as well as by reduced consumer fraud and transaction losses and lower data processing expense, reflecting the Company's continued focus on disciplined expense management and operating efficiency. The Company's effective tax rate was 21.5% for the second quarter of 2026, compared to 25.4% for the second quarter of 2025 and 19.4% for the first quarter of 2026. The lower effective tax rate compared to the prior-year quarter was primarily attributable to state income tax, non-taxable income resulting from the change in cash surrender value of bank-owned life insurance, a decrease in non-deductible expenses, and a tax credit for research and development. Balance Sheet Trends Total assets were $3.41 billion at June 30, 2026, reflecting an increase of $19.4 million, or 0.6%, compared to June 30, 2025. Gross loans were $2.74 billion at June 30, 2026, an increase of $45.7 million, or 1.7%, compared to June 30, 2025, and an increase of $58.1 million, or 2.2% from $2.68 billion at March 31, 2026. Total deposits were $2.83 billion at June 30, 2026, reflecting a decrease of $107.5 million, or 3.7%, compared to June 30, 2025. The Company continues to shift its deposit mix away from higher-cost certificates of deposit (brokered and non-brokered) and toward lower-cost core deposits. Certificates of deposit were $678.3 million at June 30, 2026, a $780.8 million, or 53.5%, decrease compared to June 30, 2025, and a $219.3 million, or 24.4%, decrease compared to March 31, 2026. Credit Quality During the second quarter of 2026, the Company recorded a provision for credit losses of $273 thousand, compared to a recovery for credit losses of $169 thousand in the second quarter of 2025, and a recovery for credit losses of $398 thousand during the first quarter of 2026. The provision recorded during the second quarter of 2026 was primarily due to strong loan growth, offset by positive changes in economic factors and no net loan charge-offs for the period. The Company's annualized net charge-offs to average loans held for investment ratio remained steady at 0.00% across the second quarter of 2026, the preceding quarter, and one year prior. Nonperforming assets totaled $22.3 million, or 0.65% of total assets, at June 30, 2026, compared to $30 million, or 0.89% of total assets, at June 30, 2025, and $22.3 million, or 0.65% of total assets at March 31, 2026. About First Carolina Financial Services, Inc. First Carolina Financial Services, Inc. (NYSE: FCBM) operates as a bank holding company for First Carolina Bank that provides financial services for businesses, higher education institutions, and individuals. First Carolina offers a range of deposit and loan products and trust services. First Carolina is headquartered in Raleigh, North Carolina with full-service banking offices in Rocky Mount, Raleigh, Wilmington, Cary, and Reidsville, North Carolina; Virginia Beach, Virginia; Columbia and Greenville, South Carolina; and Atlanta, Georgia. For more information, please visit firstcarolinabank.com. The information contained in, or that can be accessed through, our website is not incorporated by reference in, and is not part of, this press release. The inclusion of our website address in this press release is only as an inactive textual reference. Company Note Regarding Forward-Looking Statements This press release contains, and future oral and written statements by us and our management may contain, forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements include discussion of plans, estimates, objectives, goals, guidelines, expectations, intentions, projections, and statements of the Company’s beliefs concerning future events, business plans, objectives, expected operating results and the assumptions upon which those statements are based. Forward-looking statements include, without limitation, statements that may predict, forecast, indicate or imply future results, performance or achievements, and are typically identified with words such as “see,” “may,” “could,” “should,” “will,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “aim,” “intend,” “plan” or words or phases of similar meaning. We caution that the forward-looking statements are based largely on our expectations and are subject to a number of known and unknown risks and uncertainties that are subject to change based on factors which are, in many instances, beyond our control and could cause actual results to differ materially from those currently anticipated. Such risks and uncertainties include, but are not limited to: adverse developments in our borrowers’ industries and, in particular, declines in real estate values; our ability to maintain compliance with federal and state laws that regulate our business and capital levels; our ability to raise capital as needed by our business; our ability to manage growth; the loss of any of our key employees; changes in the interest rates affecting our deposits, loans, and securities portfolio; our ability to maintain adequate liquidity and control our cost of funds; the strength of the economy in our current and future market areas, as well as general economic, market, or business conditions; negative developments in the financial industry and credit markets; an insufficient allowance for credit losses as a result of inaccurate assumptions or otherwise; the ability of our current and any future markets to weather a downturn in the economy; our potential growth, including loans, deposits, and our entrance or expansion into new markets, the opportunities that may be presented to and pursued by us and the need for sufficient capital to support that growth; changes in our competitive position, competitive actions by other financial institutions and the competitive nature of the financial services industry and our ability to compete effectively against other financial institutions in our banking markets; changes in laws, regulations and the policies of federal or state regulators and agencies or interpretations thereof; governmental monetary and fiscal policies, including the policies of the Federal Reserve; our ability to maintain internal control over financial reporting and an effective risk management framework; our effective use of technology or an interruption or breach in security of our information systems; our reliance on secondary sources, such as FHLB advances, sales of securities and loans, federal funds lines of credit from correspondent banks and out-of-market time deposits, to meet our liquidity needs; inaccurate or incomplete information about our clients; our ability to assess and manage our asset quality; natural disasters, pandemics or other public health crises, war, terrorist activities or civil unrest and their effects on the economic and business environments in which we operate; risks associated with unauthorized access, cyber-crime and other threats to data security; and other risks and uncertainties described under “Risk Factors” of our Registration Statement on Form S-1 and subsequent filings with the U.S. Securities and Exchange Commission. We assume no obligation and do not intend to update these forward-looking statements, except as required by law. FIRST CAROLINA FINANCIAL SERVICES, INC. QUARTER END BALANCE SHEETS   (dollars in thousands) June 30, 2026   March 31, 2026   December 31, 2025   June 30, 2025   (unaudited)   (unaudited)   (audited)   (unaudited) Assets               Cash and cash equivalents $ 118,821     $ 190,323     $ 134,116     $ 151,910   Investment securities, available for sale   325,341       331,641       312,090       284,608   Investment securities, held to maturity   -       -       -       37,421   Federal Home Loan Bank stock, at cost   4,739       2,364       5,732       2,143   Loans receivable   2,742,549       2,684,469       2,648,174       2,696,875   Allowance for credit losses   (22,064 )     (21,121 )     (20,893 )     (21,760 ) Net loans   2,720,485       2,663,348       2,627,281       2,675,115   Premises and equipment, net   42,077       43,531       44,707       46,331   Goodwill and intangible assets, net   69,009       69,702       70,395       67,870   Deferred tax asset   24,055       24,092       25,142       31,366   Bank-owned life insurance   68,577       58,910       58,356       57,239   Prepaid expenses and other assets   32,825       34,466       39,689       32,492   Total assets $ 3,405,929     $ 3,418,377     $ 3,317,508     $ 3,386,495   Liabilities and shareholders' equity               Liabilities               Deposits               Noninterest bearing DDA $ 563,008     $ 658,707     $ 533,232     $ 577,066   Interest bearing DDA   572,971       479,032       376,537       284,266   Savings and money market   1,016,471       931,271       759,197       617,869   Certificates of deposit   678,265       897,584       1,126,707       1,459,023   Total deposits   2,830,715       2,966,594       2,795,673       2,938,224   Federal Home Loan Bank advances   50,000       -       75,000       -   Subordinated debt, net   63,489       63,463       63,436       63,383   Allowance for credit losses on off-balance sheet credit exposures   2,493       3,164       3,794       3,289   Accrued expenses and other liabilities   28,028       31,802       32,680       32,054   Total liabilities   2,974,725       3,065,023       2,970,583       3,036,950   Shareholders' equity               Common stock   15,535       12,307       12,261       12,483   Additional paid-in capital   309,745       240,684       239,903       243,631   Retained earnings   106,254       101,160       95,249       93,665   Accumulated other comprehensive loss   (330 )     (797 )     (488 )     (234 ) Total shareholders' equity   431,204       353,354       346,925       349,545   Total liabilities and shareholders' equity $ 3,405,929     $ 3,418,377     $ 3,317,508     $ 3,386,495     FIRST CAROLINA FINANCIAL SERVICES, INC. STATEMENTS OF OPERATIONS (unaudited)     As of and for the Three Months Ended   As of and for the Six Months Ended (dollars in thousands) June 30, 2026   March 31, 2026   June 30, 2025   June 30, 2026   June 30, 2025 Interest income           Interest on cash and due from banks $ 1,424   $ 1,940   $ 2,136   $ 3,364   $ 4,277   Loans, including fees   41,592     40,063     41,174     81,655     81,112   Investment securities   3,786     3,693     3,001     7,479     5,255   Other interest and dividends   44     45     47     89     123   Total interest income   46,846     45,741     46,358     92,587     90,767   Interest expense           Deposits   19,951     19,076     21,439     39,027     40,878   Borrowings   1,307     1,138     1,390     2,445     2,574   Total interest expense   21,258     20,214     22,829     41,472     43,452   Net interest income   25,588     25,527     23,529     51,115     47,315   Provision (recovery) for credit losses   273     (398 )   (169 )   (125 )   363   Net interest income after provision for credit losses   25,315     25,925     23,698     51,240     46,952   Noninterest income           Service charges on deposit accounts   5,538     6,825     12,095     12,363     19,929   Gain on sale of securities, net   -     108     -     108     -   Bank-owned life insurance   636     554     348     1,190     692   Other noninterest income   501     154     763     655     2,273   Total noninterest income   6,675     7,641     13,206     14,316     22,894   Noninterest expense           Salaries and employee benefits   11,662     12,399     15,215     24,061     27,596   Occupancy and equipment   4,013     4,325     3,902     8,338     6,901   Data processing   1,738     1,952     2,302     3,690     4,146   Other professional fees   3,183     2,506     2,198     5,689     3,569   Service fees   95     75     75     170     1,853   Federal deposit insurance premiums   650     1,050     795     1,700     1,590   Consumer fraud and transaction losses   1,432     1,338     3,522     2,770     7,039   Other noninterest expense   2,729     2,587     2,737     5,316     5,170   Total noninterest expense   25,502     26,232     30,746     51,734     57,864   Net income before taxes   6,488     7,334     6,158     13,822     11,982   Income tax expense   1,392     1,423     1,567     2,815     2,686   Net income $ 5,096   $ 5,911   $ 4,591   $ 11,007   $ 9,296         FIRST CAROLINA FINANCIAL SERVICES, INC. FINANCIAL TABLES             Financial Highlights (unaudited)           As of and for the Three Months Ended   As of and for the Six Months Ended (dollars in thousands except per share amounts) June 30, 2026   March 31, 2026   June 30, 2025   June 30, 2026   June 30, 2025 Selected Operating Data:           Interest income $ 46,846   $ 45,741   $ 46,358   $ 92,587   $ 90,767   Interest expense   21,258     20,214     22,829     41,472     43,452   Net interest income   25,588     25,527     23,529     51,115     47,315   Provision (recovery) for credit losses   273     (398 )   (169 )   (125 )   363   Noninterest income   6,675     7,641     13,206     14,316     22,894   Noninterest expense   25,502     26,232     30,746     51,734     57,864   Income tax expense   1,392     1,423     1,567     2,815     2,686   Net income   5,096     5,911     4,591     11,007     9,296   Share and Per Share Data:           Basic earnings per share $ 0.16   $ 0.24   $ 0.18   $ 0.35   $ 0.37   Diluted earnings per share $ 0.20   $ 0.24   $ 0.18   $ 0.44   $ 0.37   Book value per share (at period end) $ 13.88   $ 14.36   $ 14.00   $ 13.88   $ 14.00   Tangible book value per share 1 $ 11.66   $ 11.52   $ 11.28   $ 11.66   $ 11.28   Shares of common stock outstanding   31,068,852     24,614,852     24,965,054     31,068,852     24,965,054   Weighted average diluted shares outstanding   25,235,701     24,610,368     24,955,621     24,924,762     24,946,966   Selected Balance Sheet Data:           Total assets $ 3,405,929   $ 3,418,377   $ 3,386,495   $ 3,405,929   $ 3,386,495   Securities available-for-sale, at fair value   325,341     331,641     284,608     325,341     284,608   Securities held-to-maturity, at fair value   -     -     37,421     -     37,421   Gross loans held for investment (LHFI)   2,742,549     2,684,469     2,696,875     2,742,549     2,696,875   Allowance for credit losses   22,064     21,121     21,760     22,064     21,760   Goodwill and other intangible assets   69,009     69,702     67,870     69,009     67,870   Deposits   2,830,715     2,966,594     2,938,224     2,830,715     2,938,224   Sub debt   63,489     63,463     63,383     63,489     63,383   Other borrowings   50,000     -     -     50,000     -   Total shareholders' equity   431,204     353,354     349,545     431,204     349,545   ____________________ 1 Considered non-GAAP financial measure - See "Non-GAAP Financial Measures.”   FIRST CAROLINA FINANCIAL SERVICES, INC. FINANCIAL TABLES             Financial Highlights - continued (unaudited)         As of and for the Three Months Ended   As of and for the Six Months Ended (dollars in thousands) June 30, 2026   March 31, 2026   June 30, 2025   June 30, 2026   June 30, 2025 Performance Ratios:           Pre-tax pre-provision net revenue (PPNR) 2 $ 6,761   $ 6,936   $ 5,989   $ 13,697   $ 12,345   Return on average assets (ROAA) 2   0.60 %   0.70 %   0.56 %   0.65 %   0.58 % Return on average equity 3   5.71     6.80     5.36     6.25     5.46   Return on average tangible common equity (ROATCE) 1   7.09     8.50     6.69     7.78     6.55   Net interest margin   3.23     3.25     3.05     3.24     3.14   Efficiency ratio 1   79.05     79.35     83.70     79.20     82.42   Noninterest income to average total assets   0.79     0.91     1.61     0.85     1.43   Noninterest income to total revenue   20.69     23.04     35.95     21.88     32.61   Noninterest expense to average total assets   3.01     3.12     3.74     3.07     3.60   Average interest-earning assets to average interest-bearing liabilities   133.15     139.47     135.03     136.22     139.63   Average equity to average total assets   10.53     10.34     10.41     10.43     10.61   Asset Quality Data:           Nonperforming assets to total assets   0.65 %   0.65 %   0.89 %   0.65 %   0.89 % Nonperforming loans to gross LHFI   0.81     0.83     0.90     0.81     0.90   Total allowance for credit losses to nonperforming loans   99.07     94.54     89.75     99.07     89.75   Total allowance for credit losses to total LHFI   0.80     0.79     0.81     0.80     0.81   Net charge-offs to average LHFI   0.00     0.00     0.00     0.00     0.00   Balance Sheet and Capital Ratios:           Loan-to-deposit ratio   96.89 %   90.49 %   91.79 %   96.89 %   91.79 % Noninterest bearing deposits to total deposits   19.89     22.20     19.64     19.89     19.64   Total shareholders' equity to total assets   12.66     10.34     10.32     12.66     10.32   Tangible common equity to tangible assets 1   10.85     8.47     8.49     10.85     8.49   Other:           Number of branches   9     9     9     9     9   Number of full-time equivalent employees   269     269     312     275     312   ____________________ 1 Considered non-GAAP financial measure - See "Non-GAAP Financial Measures.” 2 Annualized calculations shown for quarterly periods presented.   FIRST CAROLINA FINANCIAL SERVICES, INC. FINANCIAL TABLES                                       QTD Average Balances and Yields/Rates (unaudited)     As of and for the Three Months Ended     June 30, 2026   March 31, 2026   June 30, 2025 (dollars in thousands)   Average balance   Interest income/expense   Average yields earned/rates paid   Average balance   Interest income/expense   Average yields earned/rates paid   Average balance   Interest income/expense   Average yields earned/rates paid Assets:                                     Loans   $ 2,688,901     $ 41,592     6.20 %   $ 2,656,562     $ 40,063     6.12 %   $ 2,671,797     $ 41,174     6.18 % Securities, available for sale     328,941       3,786     4.62 %     319,900       3,693     4.68 %     194,246       2,448     5.05 % Securities, held to maturity     -       -     0.00 %     -       -     0.00 %     40,360       553     5.50 % Deposits in banks and short-term investments     156,891       1,468     3.75 %     210,574       1,985     3.82 %     184,541       2,183     4.74 % Total interest earning assets     3,174,733       46,846     5.92 %     3,187,036       45,741     5.82 %     3,090,944       46,358     6.02 % Noninterest-earning assets     223,606               221,340               207,726           Total assets   $ 3,398,339             $ 3,408,376             $ 3,298,670           Liabilities and shareholders’ equity                                     Transaction accounts   $ 517,257     $ 4,373     3.39 %   $ 389,712     $ 3,138     3.27 %   $ 295,503     $ 2,843     3.86 % Money market and savings     972,528       7,654     3.16 %     847,186       6,294     3.01 %     614,315       5,326     3.48 % Time deposits     799,742       7,924     3.97 %     972,238       9,644     4.02 %     1,291,002       13,270     4.12 % Total interest-bearing deposits     2,289,527       19,951     3.50 %     2,209,136       19,076     3.50 %     2,200,820       21,439     3.91 % Sub debt     63,480       1,014     6.41 %     63,453       1,019     6.51 %     63,374       1,158     7.33 % Borrowings     31,348       293     3.75 %     12,534       119     3.85 %     24,801       232     3.75 % Total interest-bearing liabilities     2,384,355       21,258     3.58 %     2,285,123       20,214     3.59 %     2,288,995       22,829     4.00 % Noninterest-bearing demand deposits     620,825               731,313               623,172           Other liabilities     35,442               39,646               43,011           Shareholders’ equity     357,717               352,294               343,492           Total liabilities and shareholders’ equity   $ 3,398,339             $ 3,408,376             $ 3,298,670           Net interest spread           2.34 %           2.23 %           2.02 % Net interest income and spread       $ 25,588             $ 25,527             $ 23,529       Net interest income/margin           3.23 %           3.25 %           3.05 % Cost of total deposits           2.75 %           2.63 %           3.05 % Cost of total funding           2.84 %           2.72 %           3.14 %             FIRST CAROLINA FINANCIAL SERVICES, INC. FINANCIAL TABLES                           YTD Average Balances and Yields/Rates (unaudited)             As of and for the Six Months Ended     June 30, 2026   June 30, 2025 (dollars in thousands)   Average balance   Interest income/ expense   Average yields earned/rates paid   Average balance   Interest income/ expense   Average yields earned/rates paid Assets:                         Loans   $ 2,672,821     $ 81,655     6.16 %   $ 2,654,768     $ 81,112     6.16 % Securities, available for sale     324,446       7,478     4.65 %     153,968       4,047     5.30 % Securities, held to maturity     -       -     0.00 %     44,833       1,208     5.43 % Deposits in banks and short-term investments     183,584       3,454     3.79 %     189,171       4,400     4.69 % Total interest earning assets     3,180,851       92,587     5.87 %     3,042,740       90,767     6.02 % Noninterest-earning assets     222,479               193,504           Total assets   $ 3,403,330             $ 3,236,244           Liabilities and shareholders’ equity                         Transaction accounts     453,837       7,511     3.34 %     299,450       5,761     3.88 % Money market and savings     910,203       13,948     3.09 %     601,652       10,333     3.46 % Time deposits     885,513       17,568     4.00 %     1,193,282       24,785     4.19 % Total interest-bearing deposits     2,249,553       39,027     3.50 %     2,094,384       40,878     3.94 % Sub debt     63,467       2,033     6.46 %     63,360       2,140     6.81 % Borrowings     21,993       412     3.78 %     21,456       434     4.08 % Total interest-bearing liabilities     2,335,013       41,472     3.58 %     2,179,200       43,452     4.02 % Non-interest-bearing demand deposits     675,764               668,783           Other liabilities     37,532               45,912           Shareholders’ equity     355,021               342,349           Total liabilities and shareholders’ equity   $ 3,403,330             $ 3,236,244           Net interest spread           2.29 %           1.99 % Net interest income and spread       $ 51,115             $ 47,315       Net interest income/margin           3.24 %           3.14 % Cost of total deposits           2.69 %           2.98 % Cost of total funding           2.78 %           3.08 %         FIRST CAROLINA FINANCIAL SERVICES, INC. FINANCIAL TABLES                           Loan Data (unaudited)                     As of the Quarter Ended     June 30, 2026   March 31, 2026   June 30, 2025 (dollars in thousands)   Amount   % of Loans   Amount   % of Loans   Amount   % of Loans Construction, land & land development   $ 325,384     11.9 %   $ 283,894     10.6 %   $ 330,465     12.3 % Other commercial real estate     1,475,934     53.8 %     1,449,799     54.0 %     1,493,746     55.4 % Owner-occupied real estate     270,838     9.9 %     268,905     10.0 %     283,528     10.5 % Commercial, industrial & agricultural     313,056     11.4 %     327,404     12.2 %     297,347     11.0 % Residential real estate     355,291     13.0 %     352,532     13.1 %     289,823     10.7 % Consumer     2,046     0.1 %     1,935     0.1 %     1,966     0.1 % Gross loans held for investment   $ 2,742,549         $ 2,684,469         $ 2,696,875       Allowance for credit losses on LHFI     (22,064 )         (21,121 )         (21,760 )     Net loans held for investment   $ 2,720,485         $ 2,663,348         $ 2,675,115         Nonperforming Assets (unaudited)                   As of the Quarter Ended (dollars in thousands)   June 30, 2026   March 31, 2026   June 30, 2025 Nonaccrual loans   $ 22,272     $ 22,340     $ 24,245   Past due loans 90 days and still accruing     -       -       -   Total nonperforming loans   $ 22,272     $ 22,340     $ 24,245   Other nonperforming assets     -       -       5,780   Other real estate owned     -       -       -   Total nonperforming assets   $ 22,272     $ 22,340     $ 30,025   Nonperforming loans to gross loans     0.81 %     0.83 %     0.90 % Nonaccrual loans to gross loans     0.81 %     0.83 %     0.90 % Nonaccrual loans to total assets     0.65 %     0.65 %     0.72 % Nonperforming assets to total assets     0.65 %     0.65 %     0.89 % Non-GAAP Financial Measures Some of the financial measures discussed or presented in this press release or the accompanying financial tables are non-GAAP financial measures. In accordance with SEC rules, we classify a financial measure as being a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, that are included or excluded, as the case may be, in the most directly comparable measure calculated and presented in accordance with U.S. generally accepted accounting principles (“GAAP”). Our accounting and reporting policies conform to GAAP and the prevailing practices in the banking industry. However, we also evaluate our performance based on certain additional non-GAAP financial measures. Management uses these non-GAAP financial measures because it believes they may provide useful supplemental information for evaluating our operations and performance over periods of time, as well as in managing and evaluating our business and in discussions about our operations and performance. Management believes these non-GAAP financial measures may also provide users of our financial information with a meaningful measure for assessing our financial results and credit trends, as well as a comparison to financial results for prior periods. These non-GAAP financial measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP and are not necessarily comparable to other similarly titled measures used by other companies. Tangible common equity is defined as total shareholders’ equity less goodwill and other intangible assets. Tangible book value per share is defined as tangible common equity divided by total common shares outstanding. We believe this measure is important because it shows changes from period to period in book value per share exclusive of changes in intangible assets. Tangible common equity to tangible assets is defined as the ratio of tangible common equity divided by total tangible assets. We believe this measure is important because it shows relative changes from period to period in equity and total assets, each exclusive of changes in intangible assets. Return on average tangible common equity (ROATCE) is defined as the ratio of net income to average tangible common equity (as defined above). Efficiency ratio is defined as total noninterest expense divided by the sum of net interest income and noninterest income, excluding only gains from securities transactions. We believe this measure is important as an indicator of productivity because it shows the amount of revenue generated for each dollar spent. Pretax pre-provision return (PPNR) is defined as net income plus income tax expense plus provision (minus recovery) for credit losses. We believe that these non-GAAP financial measures provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with GAAP. However, we acknowledge that our non-GAAP financial measures have a number of limitations. As such, these disclosures should not be considered as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other banking companies use. Other banking companies may use names similar to those we disclose for the non-GAAP financial measures, but may calculate them differently. FIRST CAROLINA FINANCIAL SERVICES, INC. NON-GAAP RECONCILIATION             Tangible Book Value per Share / Tangible Common Equity to Tangible Assets (unaudited)   As of and for the Three Months Ended   As of and for the Six Months Ended (dollars in thousands, except per share data) June 30, 2026   March 31, 2026   June 30, 2025   June 30, 2026   June 30, 2025 Total shareholders' equity (GAAP) $ 431,204   $ 353,354   $ 349,545   $ 431,204   $ 349,545   Less: goodwill and intangibles   (69,009 )   (69,702 )   (67,870 )   (69,009 )   (67,870 ) Tangible common equity (Non-GAAP) $ 362,195   $ 283,652   $ 281,675   $ 362,195   $ 281,675   Common shares outstanding   31,068,852     24,614,852     24,965,054     31,068,852     24,965,054   Book value per common share (GAAP)   13.88     14.36     14.00     13.88     14.00   Tangible book value per common share (Non-GAAP)   11.66     11.52     11.28     11.66     11.28   Total assets (GAAP) $ 3,405,929   $ 3,418,377   $ 3,386,495   $ 3,405,929   $ 3,386,495   Less: goodwill and intangibles   (69,009 )   (69,702 )   (67,870 )   (69,009 )   (67,870 ) Tangible assets $ 3,336,920   $ 3,348,675   $ 3,318,625   $ 3,336,920   $ 3,318,625   Tangible common equity to tangible assets (Non-GAAP)   10.85 %   8.47 %   8.49 %   10.85 %   8.49 %   Return on Average Tangible Common Equity (unaudited)   As of and for the Three Months Ended   As of and for the Six Months Ended (dollars in thousands) June 30, 2026   March 31, 2026   June 30, 2025   June 30, 2026   June 30, 2025 Net income (GAAP) $ 5,096   $ 5,911   $ 4,591   $ 11,007   $ 9,296   Average shareholders' equity   357,717     352,294     343,492     355,020     343,575   Return on average equity   5.71 %   6.80 %   5.36 %   6.25 %   5.46 % Average shareholders' equity $ 357,717   $ 352,294   $ 343,492   $ 355,020   $ 343,575   Less: average goodwill and intangibles   (69,463 )   (70,156 )   (68,398 )   (69,807 )   (57,167 ) Average tangible common equity (Non-GAAP)   288,254     282,138     275,094     285,213     286,408   Return on average tangible common equity (Non-GAAP)   7.09 %   8.50 %   6.69 %   7.78 %   6.55 %   Efficiency Ratio (unaudited)   As of and for the Three Months Ended   As of and for the Six Months Ended (dollars in thousands) June 30, 2026   March 31, 2026   June 30, 2025   June 30, 2026   June 30, 2025 Net interest income $ 25,588   $ 25,527   $ 23,529   $ 51,115   $ 47,315   Noninterest income (loss)   6,675     7,641     13,206     14,316     22,894   Adjusted for:           Gain (loss) on sale of securities   -     108     -     108     -   Adjusted revenue $ 32,263   $ 33,060   $ 36,735   $ 65,323   $ 70,209   Total noninterest expense   25,502     26,232     30,746     51,734     57,864   GAAP-based efficiency ratio   79.04 %   79.35 %   83.70 %   79.20 %   82.42 %   FIRST CAROLINA FINANCIAL SERVICES, INC. NON-GAAP RECONCILIATION             Pretax pre-provision return (unaudited)   As of and for the Three Months Ended   As of and for the Six Months Ended (dollars in thousands) June 30, 2026   March 31, 2026   June 30, 2025   June 30, 2026   June 30, 2025 Net income (GAAP-based) $ 5,096   $ 5,911   $ 4,591   $ 11,007   $ 9,296   Plus:           Income tax expense   1,392     1,423     1,567     2,815   $ 2,686   Provision (recovery) for credit losses   273     (398 )   (169 )   (125 ) $ 363   Pre-tax, pre-provision return $ 6,761   $ 6,936   $ 5,989   $ 13,697   $ 12,345     View source version on businesswire.com: https://www.businesswire.com/news/home/20260730279439/en/

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