FIRST UNITED CORPORATION ANNOUNCES SECOND QUARTER 2026 FINANCIAL RESULTS

OAKLAND, Md. , July 20, 2026 /PRNewswire/ -- First United Corporation (the "Corporation", "we", "us", and "our") (NASDAQ: FUNC ), a bank holding company and the parent company of First United Bank & Trust (the "Bank"), today announced financial results for the three- and six-month periods ended June 30, 2026. Consolidated net income was $5.7 million on a Generally Accepted Accounting Principles ("GAAP") basis for the second quarter of 2026, or $0.87 per diluted share, compared to $6.0 million, or $0.92 per diluted share, for the second quarter of 2025 and $6.7 million, or $1.03 per diluted share, for the first quarter of 2026. Net income for the first six months of 2026 was $12.3 million, or $1.90 per diluted share, compared to $11.8 million, or $1.81 per diluted share, for the same period of 2025. Non-GAAP net income was $7.3 million and $13.9 million for the three- and six-months ended June 30, 2026, respectively. Annualized Return on Average Assets and Return on Average Equity for the six-month period ended June 30, 2026 were 1.20% and 11.92%, respectively. According to Jason Rush, President and CEO, "We delivered solid results this quarter. Earnings benefited from a stronger net interest margin and steady growth in income from our wealth franchise. While we recorded a one-time consulting expense of approximately $2.2 million, we believe the investment in technology and pricing initiatives will position us for improved efficiency in future years to come. Loan growth was steady in the second quarter and our loan pipelines remain robust going into the third quarter. Expense control will continue to be a focus across the organization." Second Quarter Financial Highlights: Net interest margin, on a non-GAAP, fully tax equivalent ("FTE") basis, was 3.98% for the second quarter of 2026, reflecting increased loan yields and reduced funding costs. Strong loan production during the quarter, with $66.0 million in commercial loan originations and $33.9 million in residential mortgage originations. Provision expense was $0.8 million in the second quarter, as a result of continued economic and political uncertainty and modest loan growth, slightly offset by improved qualitative factors. Operating expenses increased by $2.1 million when compared to the linked quarter driven by a one-time, non-GAAP $1.7 million, net of tax, expense related to consulting fees incurred for contract negotiations with our core processor in the second quarter of 2026. A cash dividend of $0.26 per share was declared in the second quarter. Income Statement Overview On a GAAP basis, net income for the second quarter of 2026 was $5.7 million, inclusive of a $1.7 million, net of tax, third party consulting expense incurred for core contract negotiations. This compares to $6.7 million in the first quarter of 2026 and $6.0 million for the second quarter of 2025. Excluding this expense item, net income was $7.3 million on a non-GAAP basis. Q2 2026 Q1 2026 Q2 2025 Net Income, GAAP (millions) $ 5.7 $ 6.7 $ 6.0 Net Income, non-GAAP (millions) $ 7.3 $ 6.6 $ 6.0 Diluted net income per share, GAAP $ 0.87 $ 1.03 $ 0.92 Diluted net income per share, non-GAAP $ 1.13 $ 1.02 $ 0.92 Second Quarter 2026 Compared to Second Quarter 2025 Consolidated net income decreased by $0.3 million for the second quarter of 2026 when compared to the second quarter of 2025. The decrease was driven by an increase in other expense as a result of a one-time, non-GAAP $1.7 million, net of tax, consulting expense related to the core contract negotiations. This increase was partially offset by a $1.9 million increase in net interest income, an increase of $0.3 million in non-interest income, inclusive of gains, and a $0.1 million decrease in provision for credit losses. Comparing the second quarter of 2026 to the same period of 2025, interest and fees on loans increased by $1.5 million as a result of new loans booked at higher rates and the continued repricing of adjustable-rate loans. Interest expense...