CARE

MARTINSVILLE, VA / ACCESS Newswire / July 23, 2026 / Carter Bankshares, Inc. (the "Company") (NASDAQ:CARE), the holding company of Carter Bank (the "Bank") today announced quarterly net income of $28.9 million, or $1.31 diluted earnings per share ("EPS"), for the second quarter of 2026 compared to net income of $85.8 million, or $3.88 diluted EPS, for the first quarter of 2026 and net income of $8.5 million, or $0.37 diluted EPS, for the second quarter of 2025. Net interest income was $40.0 million for the second quarter of 2026, $35.9 million for the first quarter of 2026, and $32.4 million for the second quarter of 2025. Adjusted net income1 was $11.6 million for the second quarter of 2026, $8.6 million for the first quarter of 2026 and $9.3 million for the second quarter of 2025. For the six months ended June 30, 2026, net income was $114.7 million, or $5.18 diluted EPS, compared to net income of $17.5 million, or $0.76 diluted EPS for the same period in 2025. Net interest income was $75.9 million for the six months ended June 30, 2026, and $62.5 million for the six months ended June 30, 2025. Adjusted net income1 was $20.2 million and $16.6 million for the six months ended June 30, 2026 and 2025, respectively. On May 1, 2026, the Company announced that it had completed the sale of its membership interest in Bearing Insurance Group, LLC (the "Insurance Transaction") to an unaffiliated third party, effective May 1, 2026. Recognized a net gain (pre-tax) from the Insurance Transaction of $35.9 million; The Insurance Transaction was accretive to diluted earnings per share by $1.30 for the quarter; and The Insurance Transaction increased tangible book value per share by $1.28. As a result of the successful completion of the Insurance Transaction and the sale of the large nonperforming credit relationship ("Loan Sale Transaction") during the first quarter of 2026, the Company generated approximately $100.9 million of aggregate nonrecurring gains during the first six months of 2026. These gains afforded an opportunity to optimize the Company's balance sheet, improve future earnings potential and enhance interest rate risk positioning. As part of this process, the Company completed a strategic repositioning of a portion of its available-for-sale securities portfolio (the "Portfolio Repositioning") during the second quarter of 2026, resulting in a pre-tax loss of $12.5 million. The Portfolio Repositioning is expected to enhance future earnings performance through improved asset yields and balance sheet positioning. In the Portfolio Repositioning, the Company sold $139.4 million in book value of securities available-for-sale with a weighted average yield of 2.28% and representing approximately 18.7% of the Company's securities portfolio, and purchased approximately $88.5 million of securities available-for-sale with a weighted average yield of approximately 5.27%. All of the securities purchased were rated AAA or AA by a recognized credit rating agency. The Company expects to use the remaining proceeds from the Portfolio Repositioning to fund organic loan growth during the remainder of 2026. Financial Highlights for the Three Months Ended June 30, 2026 Total portfolio loans increased $6.1 million at June 30, 2026 from March 31, 2026, despite approximately $132.6 million in commercial real estate loan payoffs during the second quarter, reflecting solid loan origination activity and continued demand, decreased 0.3% from June 30, 2025, and increased 6.45%7 excluding the Loan Sale Transaction from June 30, 2025; Net interest income totaled $40.0 million, an increase of $4.1 million, or 11.2% compared to the prior quarter, and an increase of $7.6 million, or 23.5% compared to the prior year quarter; Net interest margin increased 31 basis points to 3.38% for the second quarter of 2026, compared to 3.07% for the prior quarter and increased 58 basis points compared to 2.80% for the prior year quarter; Nonperforming loans ("NPLs") increased by $13.6 million to $37.6 million at June 30, 2026 compared to March 31, 2026 and decreased by $213.0 million compared to June 30, 2025 due to the Loan Sale Transaction during the first quarter of 2026. NPLs to total portfolio loans were 1.01% at June 30, 2026, 0.64% at March 31, 2026 and 6.69% at June 30, 2025; The allowance for credit losses to total portfolio loans was 1.48% at June 30, 2026, compared to 1.41% at March 31, 2026 and 1.90% at June 30, 2025. The year-over-year decrease primarily reflects the release of specific reserves of $18.0 million related to the Loan Sale Transaction during the first quarter of 2026; and The efficiency ratio was 43.66% for the quarter ended June 30, 2026, compared to 29.01% for the quarter ended March 31, 2026, and 78.63% for the quarter ended June 30, 2025. The efficiency ratios for the first and second quarters of 2026 reflect the nonrecurring gains recognized during those periods as a result of the Insurance Transaction and the Loan Sale Transaction, both as discussed above. The adjusted efficiency ratio (non-GAAP)5 improved to 62.66% for the second quarter of 2026, compared to 72.66% for the first quarter of 2026 and 75.55% for the second quarter of 2025. "We are very pleased with the successful completion of the sale of our membership interest in Bearing Insurance Group, LLC during the second quarter of 2026," stated Litz H. Van Dyke, Chief Executive Officer. "This Transaction resulted in a significant capital gain, which increased tangible book value by $1.28 per share, and provided the flexibility to reposition a portion of our available-for-sale securities portfolio. We expect these strategic actions to enhance future earnings through increased asset yields and a stronger balance sheet." Van Dyke added, "Our core operating performance remained strong during the quarter, highlighted by continued net interest margin expansion and growth in our loan portfolio across our markets. Excluding the impact of the Loan Sale Transaction during the first quarter, loans increased approximately 6.45%7 from a year ago despite elevated payoff activity. We continue to see a healthy pipeline and growing momentum in small business and commercial and industrial lending, and we expect additional growth from prior construction lending commitments that are anticipated to fund over the next 12 to 18 months as projects progress." Van Dyke concluded, "We believe the strategic initiatives undertaken in the first half of 2026 have strengthened our capital and liquidity position, providing additional financial flexibility to support future organic growth, optimize our balance sheet and capitalize on new opportunities as market conditions evolve. We are excited about what the future holds for Carter Bank." Operating Highlights Credit Quality At June 30, 2026, nonperforming loans totaled $37.6 million, compared to $24.0 million at March 31, 2026 and $250.6 million at June 30, 2025. The linked quarter increase was primarily attributable to a commercial and industrial relationship consisting of three loans with an aggregate principal balance of $13.4 million that was downgraded to substandard and placed on nonperforming status during the quarter. Nonperforming assets totaled $40.9 million at June 30, 2026, compared to $27.4 million at March 31, 2026 and $250.6 million at June 30, 2025. The ratio of nonperforming assets to total portfolio loans plus other real estate owned ("OREO") was 1.09% at June 30, 2026, compared to 0.73% at March 31, 2026 and 6.73% at June 30, 2025. The allowance for credit losses on loans totaled $55.2 million, or 1.48% of total portfolio loans, at June 30, 2026, compared to $52.5 million, or 1.41% at March 31, 2026 and $71.0 million, or 1.90% at June 30, 2025. The allowance for credit losses to nonperforming loans decreased to 146.88% at June 30, 2026, compared to 219.03% at March 31, 2026 and increased compared to 28.34% at June 30, 2025. The linked quarter decrease in the coverage ratio primarily reflected the increase in nonperforming loans during the quarter. The Company recognized net recoveries of $0.7 million for the quarter ended June 30, 2026, compared to net recoveries of $14.9 million for the quarter ended March 31, 2026 and net charge-offs of $0.2 million for the quarter ended June 30, 2025. Net recoveries (annualized) to average portfolio loans, were 0.07% for the second quarter of 2026, compared to net recoveries of 1.55% in the first quarter of 2026 and net charge-offs of 0.02% in the second quarter of 2025. Management continues to closely monitor credit quality trends and believes the allowance for credit losses remains appropriate based on the composition of the loan portfolio, current economic conditions, and other qualitative factors. Year-to-date credit quality metrics continue to reflect the impact of the first quarter 2026 Loan Sale Transaction. The transaction removed $209.5 million of nonperforming loans from the balance sheet and included the release of $18.0 million of specific reserves and the recognition of $15.0 million of loan recoveries. As a result, year-to-date comparisons to prior periods are influenced by this transaction and should be evaluated in that context. Net Interest Income and Margin Net interest income (GAAP) for the quarter ended June 30, 2026 totaled $40.0 million, representing an increase of $4.1 million, or 11.2%, from net interest income of $35.9 million in the prior quarter and an increase of $7.6 million, or 23.5%, from net interest income of $32.4 million in the prior year quarter. Net interest income, on an FTE basis4 (non-GAAP) totaled $40.2 million for the quarter ended June 30, 2026, representing an increase of $4.1 million, or 11.4%, compared to the quarter ended March 31, 2026, and an increase of $7.7 million, or 23.5% compared to the quarter ended June 30, 2025. The linked-quarter increase in net interest income, on an FTE basis4 (non-GAAP) was primarily driven by a 10 basis point decline in funding costs and a 16 basis point increase in the yield on average interest-earning assets. The year-over-year increase was attributable to a 37 basis point decline in funding costs and a 22 basis point increase in average interest-earning assets yields. During the second quarter of 2026, interest-bearing funding costs declined compared to both the prior quarter and year ago quarter, primarily reflecting a reduction in higher cost FHLB borrowings following the Loan Sale Transaction and Insurance Transaction, as well as stabilization in deposit pricing, partially reflecting the broader interest rate environment. Net interest margin was 3.38% for the quarter ended June 30, 2026 compared to 3.07% for the prior quarter and 2.80% for the quarter ended June 30, 2025. On an FTE basis4 (non-GAAP) net interest margin was 3.40% compared to 3.08% and 2.82% for the prior quarter and prior year quarter, respectively. Net interest margin continued to expand during the quarter ended June 30, 2026, reflecting the benefits of disciplined balance sheet management. The Portfolio Repositioning improved the yield on the investment portfolio, while lower funding costs, favorable loan repricing, and approximately $0.6 million in loan prepayment penalties recognized during the quarter further supported the increase in net interest income and net interest margin. The Company expects the Portfolio Repositioning to provide an ongoing benefit to future earnings through higher asset yields. Noninterest Income Noninterest income totaled $28.7 million for the second quarter of 2026, compared to $71.0 million for the first quarter of 2026 and $4.9 million for the second quarter of 2025. Key drivers of noninterest income: $35.9 million net gain recognized from the Insurance Transaction during the second quarter of 2026. $12.5 million of losses on sales of securities recognized in connection with the Portfolio Repositioning during the second quarter of 2026. $65.0 million gain recognized from the Loan Sale Transaction during the first quarter of 2026. These items are considered non-core in nature and not indicative of the Company's ongoing operating performance. Compared to the first quarter of 2026, noninterest income decreased $42.2 million, primarily due to the $65.0 million gain recognized from the Loan Sale Transaction during the first quarter of 2026 and $12.5 million of securities losses recognized in connection with the Portfolio Repositioning during the second quarter of 2026. These decreases were partially offset by the net gain recognized from the Insurance Transaction during the second quarter of 2026. Other notable changes in noninterest income included a $0.5 million increase from the prior quarter in service charges on deposit accounts. Insurance commissions declined $0.8 million from the prior quarter, primarily due to the Insurance Transaction, which reduced ongoing insurance commission income, and a favorable prior year adjustment true-up recorded in the first quarter of 2026. Compared to the second quarter of 2025, noninterest income increased $23.8 million, primarily due to the net gain recognized from the Insurance Transaction, partially offset by the $12.5 million securities losses recognized in connection with the Portfolio Repositioning during the second quarter of 2026. For the six months ended June 30, 2026, noninterest income totaled $99.7 million, compared to $11.8 million for the same period in 2025. The increase was primarily attributable to the $65.0 million gain recognized from the Loan Sale Transaction during the first quarter of 2026, the $35.9 million net gain recognized from the Insurance Transaction during the second quarter of 2026 and higher service charges on deposit accounts. These increases were partially offset by $12.5 million of securities losses recognized in connection with the Portfolio Repositioning during the second quarter of 2026 and the $1.9 million bank owned life insurance ("BOLI") death benefit recognized during the first quarter of 2025. Noninterest Expense Noninterest expense totaled $30.0 million for the second quarter of 2026, compared to $31.0 million for the first quarter of 2026 and $29.3 million for the second quarter of 2025. The linked-quarter decrease was primarily attributable to lower FDIC insurance expense and salaries and employee benefits, partially offset by increases in other noninterest expense, professional and legal fees, and data processing expense. FDIC insurance expense declined during the second quarter of 2026, primarily reflecting the favorable impact of the Loan Sale Transaction during the first quarter of 2026, which improved the Company's FDIC assessments. Salaries and employee benefits decreased $0.9 million, primarily due to lower incentive compensation compared to the first quarter of 2026, partially offset by annual merit increases, higher medical costs, and increased deferred compensation expense. Other noninterest expense increased primarily due to a $0.8 million write-down of an OREO property based on an updated appraisal received during the second quarter of 2026, as well as a $0.5 million write-down on a closed corporate office building. Professional and legal fees increased as a result of costs associated with the litigation involving the Loan Sale Transaction and higher expenses related to the management of special assets. Data processing expense increased primarily due to new and existing service agreements implemented in early 2026. Compared to the second quarter of 2025, noninterest expense increased $0.7 million, primarily reflecting increases of $1.1 million in other noninterest expense, $0.8 million in data processing expense, and $0.4 million in occupancy expense, partially offset by a $1.7 million decrease in FDIC insurance expense. The increases in other noninterest expense and data processing expense and the decrease in FDIC insurance expense were driven by the same factors discussed above. The increase in occupancy expense primarily reflected higher costs associated with new and existing service agreements, software licenses, maintenance contracts, and related infrastructure investments. For the six months ended June 30, 2026, noninterest expense totaled $61.0 million, compared to $57.3 million for the same period in 2025, an increase of $3.7 million. The increase primarily reflected $1.6 million in higher other noninterest expense, $1.2 million in data processing expense, $1.2 million in salaries and employee benefits, $0.7 million in occupancy expense, and $0.4 million in professional and legal fees, partially offset by a $1.6 million decrease in FDIC insurance expense. These changes were attributable to the same factors discussed in the quarterly comparison above. Financial Condition Total assets increased $2.6 million to $4.8 billion at June 30, 2026, compared to March 31, 2026. The increase was primarily driven by a $6.1 million increase in portfolio loans, despite approximately $132.6 million in commercial real estate loan payoffs during the second quarter of 2026, reflecting continued loan origination activity and customer demand across the Company's markets. Total cash and cash equivalents increased $48.2 million during the quarter, primarily reflecting higher interest-bearing deposits maintained with other financial institutions from excess liquidity generated by the Loan Sale Transaction during the first quarter of 2026 and the Insurance Transaction during the second quarter of 2026. The increase in interest-bearing deposits with other financial institutions reflected the redeployment of excess liquidity from Federal Reserve balances into higher-yielding deposit accounts during the quarter. The Company continued to strategically deploy excess liquidity during the quarter through loan growth and the previously announced Portfolio Repositioning. The allowance for credit losses on loans totaled $55.2 million, or 1.48% of total portfolio loans at June 30, 2026, compared to $52.5 million, or 1.41%, at March 31, 2026. Available-for-sale investment securities declined $21.8 million during the second quarter of 2026, primarily reflecting the previously announced Portfolio Repositioning, which is part of the Company's broader balance sheet optimization strategy. These securities represented 13.3% of total assets at June 30, 2026, compared to 13.8% at March 31, 2026. Total deposits decreased $37.7 million from March 31, 2026, primarily reflecting normal fluctuations in customer deposit balances. The Company had no Federal Home Loan Bank ("FHLB") borrowings outstanding at June 30, 2026, as higher cost wholesale borrowings had been repaid with proceeds from the Company's recent strategic transactions, contributing to lower funding costs and a more efficient balance sheet. At June 30, 2026, approximately 82.3% of total deposits were insured under FDIC insurance coverage limits, while approximately 17.7% of total deposits were uninsured. At March 31, 2026, approximately 82.8% of total deposits were insured under Federal Deposit Insurance Corporation ("FDIC") insurance coverage limits, while approximately 17.2% of total deposits were uninsured. Capitalization and Liquidity The Company maintained a strong capital and liquidity position at June 30, 2026. Capital levels increased significantly and continued to exceed all applicable regulatory requirements, supported by earnings for the quarter and the impact of the recent strategic transactions. The Company remained well capitalized at June 30, 2026. The Company's Tier 1 capital ratio was 14.26% at June 30, 2026, compared to 13.52% at March 31, 2026. The Company's leverage ratio was 11.65% at June 30, 2026, compared to 11.10% at March 31, 2026. The Company's total risk-based capital ratio was 15.51% at June 30, 2026, compared to 14.78% at March 31, 2026. During both the three and six months ended June 30, 2026, the Company repurchased 108,601 shares of its common stock at a total cost of $2.9 million and a weighted average cost per share of $26.50. At June 30, 2026, funding sources accessible to the Company included borrowing availability at the FHLB equal to 30.0% of total assets, or $1.4 billion, subject to eligible collateral pledged, of which the Company had the capacity to borrow an additional $879.5 million. During the six months ended June 30, 2026, the Company's previously disclosed $45.0 million secured line of credit with a correspondent financial institution was converted to an unsecured facility, with a borrowing capacity of $25.0 million. In addition, a $50.0 million unsecured line of credit with an unrelated correspondent financial institution was fully reinstated. Reflecting the Company's improved earnings performance and enhanced credit risk profile following the Loan Sale Transaction during the first quarter of 2026, the Company now maintains unsecured borrowing lines of credit totaling $105.0 million with four correspondent financial institutions and continues to have access to the institutional CD market. In addition to these funding sources, the Company had $500.6 million of unpledged available-for-sale investment securities at fair value at June 30, 2026, providing additional liquidity. About Carter Bankshares, Inc. Headquartered in Martinsville, VA, Carter Bankshares, Inc. (NASDAQ:CARE) provides a full range of commercial banking, consumer banking, mortgage and other services through its subsidiary Carter Bank. The Company has $4.8 billion in assets and 63 branches in Virginia and North Carolina as of June 30, 2026. For more information or to open an account visit www.carterbank.com. Important Note Regarding Non-GAAP Financial Measures In addition to results presented in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"), management uses, and this press release contains or references, certain non-GAAP financial measures, including pre-tax pre-provision income, adjusted net income, adjusted earnings per common share (diluted), tangible book value, tangible shareholders' equity, adjusted noninterest income, adjusted noninterest expense, adjusted loan growth, adjusted efficiency ratio, and interest and dividend income, yield on interest-earning assets, net interest income and net interest margin on a fully taxable equivalent ("FTE") basis. These non-GAAP measures should be read along with the accompanying tables in our definitions and reconciliation of GAAP to non-GAAP financial measures. Management believes these non-GAAP financial measures are useful because they enhance the ability of investors and management to evaluate and compare the Company's operating results across periods in a meaningful manner. These measures also assist in assessing the Company's underlying operating performance and performance trends and facilitate comparisons with other financial services companies. The Company believes that presenting interest and dividend income, yield on interest-earning assets, net interest income and net interest margin on an FTE basis improves comparability between income derived from taxable and tax-exempt sources and is consistent with industry practice. While management believes these non-GAAP measures provide meaningful supplemental information, they should not be considered as an alternative to GAAP results, as more relevant than financial results prepared in accordance with GAAP, or as necessarily comparable to similarly titled non-GAAP measures used by other companies. Non-GAAP financial measures have limitations as analytical tools, and should not be considered in isolation or as a substitute for an analysis of the Company's financial condition or results of operations as reported under GAAP. Investors are encouraged to review the Company's GAAP financial results and all other relevant information when evaluating its performance and financial condition. Important Note Regarding Forward-Looking Statements This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements made in Mr. Van Dyke's quotations and may include statements relating to the financial consequences of the Portfolio Restructuring, our financial condition, market conditions, results of operations, plans, including our strategic plan, brand strategy, and guiding principles and the anticipated results of the foregoing, objectives, outlook for earnings, revenues, expenses, capital and liquidity levels and ratios, asset levels, asset quality, loan pipeline and nonaccrual and nonperforming loans. Forward looking statements are typically identified by words or phrases such as "will likely result," "expect," "anticipate," "estimate," "forecast," "project," "intend," "believe," "assume," "strategy," "trend," "plan," "outlook," "outcome," "continue," "remain," "potential," "opportunity," "comfortable," "current," "position," "maintain," "sustain," "seek," "achieve" and variations of such words and similar expressions, or future or conditional verbs such as will, would, should, could or may. These statements are not guarantees of future results or performance and involve certain risks, uncertainties and assumptions that are difficult to predict and often are beyond the Company's control. Although we believe the assumptions upon which these forward-looking statements are based are reasonable, any of these assumptions could prove to be inaccurate and the forward-looking statements based on these assumptions could be incorrect. Actual results may differ significantly from those expressed in or implied by these forward-looking statements. The matters discussed in these forward-looking statements are subject to various risks, uncertainties and other factors that could cause actual results and trends to differ materially from those made, projected, or implied in or by the forward-looking statements including, but not limited to the effects of: market interest rates and the impacts of market interest rates on economic conditions, customer behavior, and the Company's net interest margin, net interest income, funding costs and its deposit, loan and securities portfolios; inflation, market and monetary fluctuations; changes in trade policies, tariffs, monetary and fiscal policies and laws of the U.S. government and the related impacts on economic conditions and financial markets, and changes in policies of the Federal Reserve, FDIC and U.S. Department of the Treasury; changes in accounting policies, practices, or guidance, for example, our adoption of Current Expected Credit Losses ("CECL") methodology, including potential volatility in the Company's operating results due to application of the CECL methodology; cyber-security threats, attacks or events; rapid technological developments and changes, including emerging issues related to the development and use of artificial intelligence that could give rise to legal or regulatory action or increase cybersecurity threats; our ability to resolve our nonperforming assets and our ability to secure collateral on loans that have entered nonaccrual status due to loan maturities and failure to pay in full; changes in the Company's liquidity and capital positions; concentrations of loans secured by real estate, particularly commercial real estate loans, and the potential impacts of changes in market conditions on the value of real estate collateral; increased delinquency and foreclosure rates on commercial real estate loans; an insufficient allowance for credit losses; the potential adverse effects of unusual and infrequently occurring events, such as weather-related disasters, terrorist acts, war and other geopolitical conflicts or public health events (such as pandemics), and of any governmental and societal responses thereto; these potential adverse effects may include, without limitation, adverse effects on macroeconomic conditions, the ability of the Company's borrowers to satisfy their obligations to the Company, on the value of collateral securing loans, on the demand for the Company's loans or its other products and services, on incidents of cyberattack and fraud, on the Company's liquidity or capital positions, on risks posed by reliance on third-party service providers, on other aspects of the Company's business operations and on financial markets and economic growth; a change in spreads on interest-earning assets and interest-bearing liabilities; regulatory supervision and oversight, including our relationship with regulators and any actions that may be initiated by our regulators; legislation affecting the financial services industry as a whole, and the Company and the Bank, in particular and changes impacting the rulemaking, supervision, examination and enforcement priorities of the federal banking agencies; the outcome of pending and future litigation and/or governmental proceedings; increasing price and product/service competition; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; managing our internal growth and acquisitions; the possibility that the anticipated benefits from acquisitions cannot be fully realized in a timely manner or at all, or that integrating acquired operations will be more difficult, disruptive or more costly than anticipated; the soundness of other financial institutions and any indirect exposure related to large bank failures and their impact on the broader market through other customers, suppliers and partners or that the conditions which resulted in the liquidity concerns with those failed banks may also adversely impact, directly or indirectly, other financial institutions and market participants with which the Company has commercial or deposit relationships with; material increases in costs and expenses; reliance on significant customer relationships; general economic or business conditions, including unemployment levels, supply chain disruptions, slowdowns in economic growth, government shutdowns and geopolitical instability and tensions; significant weakening of the local economies in which we operate; changes in customer behaviors, including consumer spending, borrowing and saving habits; changes in deposit flows and loan demand; our failure to attract or retain key associates; expansions or consolidations in the Company's branch network, including that the anticipated benefits of the Company's branch acquisitions or the Company's branch network optimization project are not fully realized in a timely manner or at all; deterioration of the housing market and reduced demand for mortgages; and turbulence in significant portions of the global financial and real estate markets that could impact our performance, both directly, by affecting our revenues and the value of our assets and liabilities, and indirectly, by affecting the economy generally and access to capital in the amounts, at the times and on the terms required to support our future businesses. Many of these factors, as well as other factors, are described in our filings with the Securities and Exchange Commission, including in the "Risk Factors" section of the Company's Annual Report on Form 10-K for the year ended December 31, 2025. All risk factors and uncertainties described herein and therein should be considered in evaluating the Company's forward-looking statements. Forward-looking statements are based on beliefs and assumptions using information available at the time the statements are made. We caution you not to unduly rely on forward-looking statements because the assumptions, beliefs, expectations and projections about future events are expressed in or implied by a forward-looking statement may, and often do, differ materially from actual results. Any forward-looking statement speaks only as to the date on which it is made, and we undertake no obligation to update, revise or clarify any forward-looking statement to reflect developments occurring after the statement is made, except as required by law. Carter Bankshares, [email protected] CARTER BANKSHARES, INC.CONSOLIDATED SELECTED FINANCIAL DATABALANCE SHEETS CARTER BANKSHARES, INC.CONSOLIDATED SELECTED FINANCIAL DATAINCOME STATEMENTS *All outstanding unvested restricted stock awards are considered participating securities for the earnings per share calculation. As such, these shares have been allocated to a portion of net income ($402 thousand, $1,069 thousand and $97 thousand for the quarters ended June 30, 2026, March 31, 2026 and June 30, 2025, respectively and $1,514 thousand and $190 thousand for the six months ended June 30, 2026 and 2025, respectively) and are excluded from the diluted earnings per share calculation. CARTER BANKSHARES, INC.CONSOLIDATED SELECTED FINANCIAL DATANET INTEREST MARGIN (FTE) (QTD AVERAGES)(Unaudited) a Nonaccruing loans are included in the daily average loan amounts outstanding. CARTER BANKSHARES, INC.CONSOLIDATED SELECTED FINANCIAL DATANET INTEREST MARGIN (FTE) (YTD AVERAGES)(Unaudited) a Nonaccruing loans are included in the daily average loan amounts outstanding. LOANS AND LOANS HELD-FOR-SALE(Unaudited) CARTER BANKSHARES, INC.CONSOLIDATED SELECTED FINANCIAL DATAASSET QUALITY DATA(Unaudited) CARTER BANKSHARES, INC.CONSOLIDATED SELECTED FINANCIAL DATAALLOWANCE FOR CREDIT LOSSES(Unaudited) DEFINITIONS AND RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES:(Unaudited) CARTER BANKSHARES, INC.CONSOLIDATED SELECTED FINANCIAL DATA 4 Net interest income has been computed on a fully taxable equivalent basis ("FTE") using 21% federal income tax rate for the 2026 and 2025 periods. CARTER BANKSHARES, INC.CONSOLIDATED SELECTED FINANCIAL DATA 6The Gain on BOLI death benefit is tax-exempt. SOURCE: Carter Bankshares, Inc. View the original press release on ACCESS Newswire

Carter Bankshares, Inc. (CARE) came out with quarterly earnings of $0.53 per share, beating the Zacks Consensus Estimate of $0.41 per share. This compares to earnings of $0.41 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +29.27%. A quarter ago, it was expected that this company would post earnings of $3.91 per share when it actually produced earnings of $0.4, delivering a surprise of -89.77%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Carter Bankshares, which belongs to the Zacks Banks - Northeast industry, posted revenues of $68.92 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 3.28%. This compares to year-ago revenues of $37.44 million. The company has topped consensus revenue estimates just once over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Carter Bankshares shares have added about 67.5% since the beginning of the year versus the S&P 500's gain of 9.6%. While Carter Bankshares has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Carter Bankshares was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.52 on $46.22 million in revenues for the coming quarter and $5.43 on $267.25 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Banks - Northeast is currently in the top 37% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. HBT Financial (HBT), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on July 27. This bank holding company is expected to post quarterly earnings of $0.74 per share in its upcoming report, which represents a year-over-year change of +17.5%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. HBT Financial's revenues are expected to be $80.7 million, up 37.2% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Carter Bankshares, Inc. (CARE) : Free Stock Analysis Report HBT Financial, Inc. (HBT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

MARTINSVILLE, VA / ACCESS Newswire / April 23, 2026 / Carter Bankshares, Inc. (the "Company") (NASDAQ:CARE), the holding company of Carter Bank (the "Bank") today announced quarterly net income of $85.8 million, or $3.88 diluted earnings per share ("EPS"), for the first quarter of 2026 compared to net income of $8.5 million, or $0.38 diluted EPS, for the fourth quarter of 2025 and net income of $9.0 million, or $0.39 diluted EPS, for the first quarter of 2025. Net interest income was $35.9 million for the first quarter of 2026, $34.6 million for the fourth quarter of 2025, and $30.1 million for the first quarter of 2025. Pre-tax pre-provision income1 was $75.9 million for the first quarter of 2026, $8.8 million for the fourth quarter of 2025 and $9.0 million for the first quarter of 2025. On March 26, 2026, the Bank completed the sale (the "Transaction") of all loans, subsequently reduced to judgments related to various entities in which James C. Justice, II has an interest (such loans, subsequently reduced to judgments, the "Loans"). The Transaction was completed as an absolute, "as-is, where-is" sale to an unaffiliated third party. The Company received consideration of $289.5 million in cash in the Transaction. Immediately prior to the Transaction, the Loans had an outstanding aggregate principal amount of $209.5 million, all of the Loans were nonperforming and on nonaccrual status, and the Company had recorded a specific reserve with respect to the Loans of $18.0 million as of December 31, 2025. Transaction Highlights Received consideration of $289.5 million in cash in the Transaction during the quarter; Recognized a net gain on the Transaction of $80.0 million, comprised of: $65.0 million gain on the Transaction; and $15.0 million net recovery; Released $18.0 million of specific reserves related to the Loans; The Transaction was accretive to diluted earnings per share by $3.50 for the quarter; and The Transaction increased each of book value per share and tangible book value per share by $3.49. Financial Highlights for the Three Months Ended March 31, 2026 Total portfolio loans decreased $151.1 million at March 31, 2026 from December 31, 2025 due to the Transaction, partially offset by net loan growth during the first quarter of $58.4 million, or 6.1%7 on an annualized basis, and increased $41.0 million, or 1.1% from March 31, 2025; Net interest income totaled $35.9 million, an increase of $1.3 million, or 3.8% compared to the prior quarter, and an increase of $5.8 million, or 19.2% compared to the prior year quarter; Net interest margin increased 15 basis points to 3.07% for the first quarter of 2026, compared to 2.92% for the prior quarter and increased 39 basis points compared to the prior year quarter; Nonperforming loans ("NPLs") decreased significantly by $220.0 million to $24.0 million at March 31, 2026 compared to December 31, 2025 due to the Transaction. NPLs to total portfolio loans were 0.64% at March 31, 2026, 6.29% at December 31, 2025 and 7.09% at March 31, 2025; The allowance for credit losses to total portfolio loans was 1.41% at March 31, 2026, compared to 1.84% at December 31, 2025 and 1.99% at March 31, 2025, primarily reflecting the release of specific reserves of $18.0 million related to the Loans; and The efficiency ratio was 29.01% for the quarter ended March 31, 2026, compared to 77.84% and 75.71% for the quarters ended December 31, 2025 and March 31, 2025, respectively. The improvement was primarily driven by the gain on the Transaction, which increased noninterest income for the quarter. The adjusted efficiency ratio (non-GAAP)5 was 72.66%, 76.85%, and 78.67% for the quarters ended March 31, 2026, December 31, 2025 and March 31, 2025, respectively. "We are very pleased to report the successful resolution of our largest nonperforming credit relationship during the first quarter of 2026," stated Litz H. Van Dyke, Chief Executive Officer. "This Transaction meaningfully strengthened our balance sheet and favorably increased tangible book value by $3.49 per share, while also improving key financial ratios. It represents an important milestone for the Company and positions us well for continued growth." Van Dyke added, "We continued to deliver strong operating performance during the quarter, highlighted by margin expansion and solid loan growth across our footprint. Annualized loan growth of 6.1%7, net of the Transaction, reflects continued momentum in our commercial and small business lending platforms, supported by a healthy pipeline and increasing traction in commercial and industrial lending. We also expect a continued tailwind from prior construction lending commitments, which are anticipated to fund over the next 12 to 18 months as projects progress. Our balance sheet remains slightly liability sensitive, positioning us to benefit from potential Federal Reserve interest rate reductions, which we expect would further support margin expansion, particularly given the short-term nature of our certificates of deposit ("CD") portfolio." Operating Highlights Credit Quality Credit quality metrics for the quarter were favorably impacted by the Transaction, driving meaningful improvements in nonperforming assets and overall credit quality trends. During the quarter, the Company recognized a recovery for credit losses of $33.9 million and a recovery for unfunded commitments of $0.2 million, primarily reflecting the release of previously established specific reserves of $18.0 million, as well as a $15.0 million net recovery associated with the Loans, in each case related to the Transaction. As a result, the Company recorded a net benefit to the recovery for credit losses, contributing to a decline in the allowance for credit losses to total portfolio loans. The net benefit to the recovery for credit losses was a significant driver of earnings for the quarter. At March 31, 2026, nonperforming assets declined to $27.4 million compared to $244.1 million at December 31, 2025 and $262.0 million at March 31, 2025, primarily reflecting the resolution of the aforementioned credit relationship. Nonperforming loans decreased to $24.0 million at March 31, 2026, from $244.0 million at December 31, 2025 and $261.4 million at March 31, 2025. The ratio of nonperforming assets to total portfolio loans plus other real estate owned ("OREO") improved to 0.73% at March 31, 2026, compared to 6.29% at December 31, 2025 and 7.10% at March 31, 2025. The allowance for credit losses to total portfolio loans was 1.41% at March 31, 2026 compared to 1.84% at December 31, 2025 and 1.99% at March 31, 2025, reflecting the release of previously established reserves of $18.0 million related to the Loans. The allowance for credit losses to nonperforming loans increased to 219.03% at March 31, 2026 compared to 29.30% at December 31, 2025 and 28.12% at March 31, 2025, driven by the significant reduction in nonperforming loans. The Company recognized net recoveries of $14.9 million for the quarter ended March 31, 2026, compared to net charge-offs of $0.1 million for the fourth quarter of 2025 and $0.1 million for the first quarter of 2025. Net recoveries (annualized) to average portfolio loans, were 1.55% for the quarter ended March 31, 2026 compared to net charge-offs of 0.01% in each of the fourth quarter of 2025 and the first quarter of 2025. Excluding the impact of the Transaction, underlying credit quality trends remained relatively stable during the first quarter of 2026. Net Interest Income and Margin Net interest income (GAAP) for the quarter ended March 31, 2026 totaled $35.9 million, representing an increase of $1.3 million from net interest income of $34.6 million in the prior quarter and an increase of $5.8 million from net interest income of $30.1 million in the prior year quarter. Net interest income, on an FTE basis4 (non-GAAP) totaled $36.1 million for the quarter ended March 31, 2026, representing an increase of $1.3 million, or 3.8%, compared to the quarter ended December 31, 2025, and an increase of $5.8 million, or 19.0% compared to the quarter ended March 31, 2025. The linked-quarter increase in net interest income, on an FTE basis4 (non-GAAP) was primarily driven by a 12 basis point decline in funding costs and a six basis point increase in the yield on average interest-earning assets. The year-over-year increase was attributable to a 41 basis point decline in funding costs and a seven basis point increase in average interest-earning assets yields. Net interest income during the first quarter of 2026 benefited from lower rates paid on average interest-bearing liabilities and higher average loan balances compared to both the prior quarter and the prior year quarter. These positive impacts were partially offset by declines in both average balances of and yields on investment securities. Net interest margin was 3.07% for the quarter ended March 31, 2026 compared to 2.92% for the prior quarter and 2.68% for the quarter ended March 31, 2025. On an FTE basis4 (non-GAAP) net interest margin was 3.08% compared to 2.93% and 2.70% for the prior quarter and prior year quarter, respectively. During the first quarter of 2026, interest-bearing funding costs declined compared to both the prior quarter and prior year quarter, primarily due to continued reductions in funding costs, as well as stabilization in deposit pricing, partially reflecting the broader interest rate environment. Noninterest Income Noninterest income for the quarter ended March 31, 2026 totaled $71.0 million, increasing $65.7 million from the prior quarter and $64.1 million from the prior year quarter. The increase was primarily driven by the $65.0 million gain on the Transaction, which is considered non-core in nature and not indicative of the Company's ongoing operating performance. Compared to the quarter ended March 31, 2025, insurance commissions increased $0.6 million, while other noninterest income decreased $2.0 million, primarily reflecting favorable period-end adjustments within insurance commissions and the impact of a $1.9 million gain on a bank owned life insurance ("BOLI") death benefit recognized in the first quarter of 2025, respectively. Noninterest Expense Noninterest expense for the quarter ended March 31, 2026 totaled $31.0 million, relatively unchanged compared to the prior quarter and increased $3.0 million compared to the prior year quarter. Compared to the prior quarter, the quarter reflected several changes across expense categories. Salaries and employee benefits decreased $1.1 million, primarily due to lower base salaries resulting from seasonal expenses in the prior quarter and two less working days in the first quarter, medical costs, and deferred compensation expense, partially offset by higher incentive compensation. Data processing increased $0.4 million and occupancy expenses increased $0.5 million, primarily reflecting higher costs associated with new and existing service agreements, software licenses, maintenance contracts, and related infrastructure investments. Other noninterest expense increased $0.7 million primarily due to a write-down of $0.6 million on one closed office that was transferred to OREO during the first quarter of 2026. Compared to the quarter ended March 31, 2025, salaries and employee benefits increased $1.3 million, other noninterest expense increased $0.5 million, data processing expenses increased $0.4 million, occupancy expense increased $0.4 million and professional and legal fees increased $0.3 million. The increase in salaries and employee benefits was primarily driven by higher incentive compensation, increased medical costs and annual merit increases, partially offset by higher deferred costs on loan originations. Other noninterest expense increased primarily due to the aforementioned $0.6 million write-down on one closed office that was transferred to OREO during the first quarter of 2026. Data processing expenses increased due to inflationary cost pressures and higher costs associated with new and existing service agreements implemented in early 2026. The increase in occupancy expense was primarily attributable to maintenance contracts entered into during the first quarter of 2026 and related infrastructure investments. Professional and legal fees increased primarily due to costs associated with the Transaction and higher expenses related to the management of special assets. Financial Condition Total assets decreased $52.7 million to $4.8 billion at March 31, 2026, compared to December 31, 2025. The decrease was primarily driven by a $151.1 million decline in portfolio loans, largely reflecting the Transaction, partially offset by net loan growth during the first quarter of $58.4 million. This decrease was partially offset by an increase in cash and due from banks of $123.2 million, as balances held at the Federal Reserve Bank increased due to the excess proceeds from the Transaction in the first quarter of 2026. The allowance for credit losses decreased $19.0 million during the first quarter, primarily reflecting the release of the $18.0 million of specific reserve related to the Loans. Available-for-sale investment securities decreased $29.5 million, primarily due to normal paydowns, calls and sales, as well as changes in unrealized losses, partially offset by purchases. These securities represented 13.8% of total assets at March 31, 2026, compared to 14.3% at December 31, 2025. Federal Home Loan Bank ("FHLB") stock declined $8.4 million in line with lower borrowing levels. On the funding side, FHLB borrowings decreased $178.5 million during the first quarter, reflecting the repayment of borrowings utilizing proceeds from the Transaction. Total deposits increased $24.4 million to $4.2 billion at March 31, 2026 compared to December 31, 2025, reflecting an increase of $63.2 million in interest-bearing demand deposits and $17.5 million in noninterest-bearing demand deposits, partially offset by a decrease of $39.6 million in money market accounts and $17.5 million in CDs. Other liabilities increased $16.5 million, primarily due to an increase in taxes payable associated with the Transaction. At March 31, 2026, approximately 82.8% of total deposits were insured under FDIC insurance coverage limits, while approximately 17.2% of total deposits were uninsured. At December 31, 2025, approximately 81.3% of total deposits were insured under Federal Deposit Insurance Corporation ("FDIC") insurance coverage limits, while approximately 18.7% of total deposits were uninsured. Capitalization and Liquidity The Company maintained a strong capital and liquidity position at March 31, 2026. Capital levels increased significantly and continued to exceed all applicable regulatory requirements, supported by earnings for the quarter and the impact of the Transaction. The Company remained well capitalized at March 31, 2026. The Company's Tier 1 capital ratio was 13.52% at March 31, 2026, compared to 10.70% at December 31, 2025. The Company's leverage ratio was 11.10% at March 31, 2026, compared to 9.43% at December 31, 2025. The Company's total risk-based capital ratio was 14.78% at March 31, 2026, compared to 11.95% at December 31, 2025. The Company did not repurchase any shares under the current repurchase plan during the three months ended March 31, 2026. The Transaction also resulted in an increase in book value per share and tangible book value of $3.49 per share, reflecting the net gain recognized on the Transaction and the associated improvement in capital. At March 31, 2026, funding sources accessible to the Company included borrowing availability at the FHLB equal to 30.0% of total assets, or $1.4 billion, subject to eligible collateral pledged, of which the Company had the capacity to borrow an additional $816.6 million. The Company also maintains unsecured facilities with three correspondent financial institutions totaling $30.0 million, a fully secured facility with one correspondent financial institution totaling $25.0 million, and access to the institutional CD market. The borrowing capacity under the secured line of credit decreased by $20.0 million during the quarter ended March 31, 2026, from $45.0 million as of March 13, 2026, as a result of the sale of investment securities previously pledged as collateral to the secured facility, which reduced the borrowing capacity, as the Company did not replace the sold investment securities with new pledged assets. In addition to these funding sources, the Company had $407.8 million of unpledged available-for-sale investment securities at fair value at March 31, 2026, providing additional liquidity. About Carter Bankshares, Inc. Headquartered in Martinsville, VA, Carter Bankshares, Inc. (NASDAQ:CARE) provides a full range of commercial banking, consumer banking, mortgage and services through its subsidiary Carter Bank. The Company has $4.8 billion in assets and 63 branches in Virginia and North Carolina as of March 31, 2026. For more information or to open an account visit www.carterbank.com. Important Note Regarding Non-GAAP Financial Measures In addition to results presented in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"), management uses, and this press release contains or references, certain non-GAAP financial measures, including pre-tax pre-provision income, adjusted net income, adjusted earnings per common share (diluted), tangible book value, adjusted noninterest expense, adjusted efficiency ratio, and interest and dividend income, yield on interest-earning assets, net interest income and net interest margin on a fully taxable equivalent ("FTE") basis. These non-GAAP measures should be read along with the accompanying tables in our definitions and reconciliation of GAAP to non-GAAP financial measures. Management believes these non-GAAP financial measures are useful because they enhance the ability of investors and management to evaluate and compare the Company's operating results across periods in a meaningful manner. These measures also assist in assessing the Company's underlying operating performance and performance trends and facilitate comparisons with other financial services companies. The Company believes that presenting interest and dividend income, yield on interest-earning assets, net interest income and net interest margin on an FTE basis improves comparability between income derived from taxable and tax-exempt sources and is consistent with industry practice. While management believes these non-GAAP measures provide meaningful supplemental information, they should not be considered as an alternative to GAAP results, as more relevant than financial results prepared in accordance with GAAP, or as necessarily comparable to similarly titled non-GAAP measures used by other companies. Non-GAAP financial measures have limitations as analytical tools, and should not be considered in isolation or as a substitute for an analysis of the Company's financial condition or results of operations as reported under GAAP. Investors are encouraged to review the Company's GAAP financial results and all other relevant information when evaluating its performance and financial condition. Important Note Regarding Forward-Looking Statements This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements made in Mr. Van Dyke's quotations and may include statements relating to our financial condition, market conditions, results of operations, plans, including our strategic plan, brand strategy, and guiding principles and the anticipated results of the foregoing, objectives, outlook for earnings, revenues, expenses, capital and liquidity levels and ratios, asset levels, asset quality, loan pipeline and nonaccrual and nonperforming loans. Forward looking statements are typically identified by words or phrases such as "will likely result," "expect," "anticipate," "estimate," "forecast," "project," "intend," "believe," "assume," "strategy," "trend," "plan," "outlook," "outcome," "continue," "remain," "potential," "opportunity," "comfortable," "current," "position," "maintain," "sustain," "seek," "achieve" and variations of such words and similar expressions, or future or conditional verbs such as will, would, should, could or may. These statements are not guarantees of future results or performance and involve certain risks, uncertainties and assumptions that are difficult to predict and often are beyond the Company's control. Although we believe the assumptions upon which these forward-looking statements are based are reasonable, any of these assumptions could prove to be inaccurate and the forward-looking statements based on these assumptions could be incorrect. Actual results may differ significantly from those expressed in or implied by these forward-looking statements. The matters discussed in these forward-looking statements are subject to various risks, uncertainties and other factors that could cause actual results and trends to differ materially from those made, projected, or implied in or by the forward-looking statements including, but not limited to the effects of: market interest rates and the impacts of market interest rates on economic conditions, customer behavior, and the Company's net interest margin, net interest income, funding costs and its deposit, loan and securities portfolios; inflation, market and monetary fluctuations; changes in trade policies, tariffs, monetary and fiscal policies and laws of the U.S. government and the related impacts on economic conditions and financial markets, and changes in policies of the Federal Reserve, FDIC and U.S. Department of the Treasury; changes in accounting policies, practices, or guidance, for example, our adoption of Current Expected Credit Losses ("CECL") methodology, including potential volatility in the Company's operating results due to application of the CECL methodology; cyber-security threats, attacks or events; rapid technological developments and changes, including emerging issues related to the development and use of artificial intelligence that could give rise to legal or regulatory action or increase cybersecurity threats; our ability to resolve our nonperforming assets and our ability to secure collateral on loans that have entered nonaccrual status due to loan maturities and failure to pay in full; changes in the Company's liquidity and capital positions; concentrations of loans secured by real estate, particularly commercial real estate ("CRE") loans, and the potential impacts of changes in market conditions on the value of real estate collateral; increased delinquency and foreclosure rates on CRE loans; an insufficient allowance for credit losses; the potential adverse effects of unusual and infrequently occurring events, such as weather-related disasters, terrorist acts, war and other geopolitical conflicts or public health events (such as pandemics), and of any governmental and societal responses thereto; these potential adverse effects may include, without limitation, adverse effects on macroeconomic conditions, the ability of the Company's borrowers to satisfy their obligations to the Company, on the value of collateral securing loans, on the demand for the Company's loans or its other products and services, on incidents of cyberattack and fraud, on the Company's liquidity or capital positions, on risks posed by reliance on third-party service providers, on other aspects of the Company's business operations and on financial markets and economic growth; a change in spreads on interest-earning assets and interest-bearing liabilities; regulatory supervision and oversight, including our relationship with regulators and any actions that may be initiated by our regulators; legislation affecting the financial services industry as a whole, and the Company and the Bank, in particular and changes impacting the rulemaking, supervision, examination and enforcement priorities of the federal banking agencies; the outcome of pending and future litigation and/or governmental proceedings; increasing price and product/service competition; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; managing our internal growth and acquisitions; the possibility that the anticipated benefits from acquisitions cannot be fully realized in a timely manner or at all, or that integrating acquired operations will be more difficult, disruptive or more costly than anticipated; the soundness of other financial institutions and any indirect exposure related to large bank failures and their impact on the broader market through other customers, suppliers and partners or that the conditions which resulted in the liquidity concerns with those failed banks may also adversely impact, directly or indirectly, other financial institutions and market participants with which the Company has commercial or deposit relationships with; material increases in costs and expenses; reliance on significant customer relationships; general economic or business conditions, including unemployment levels, supply chain disruptions, slowdowns in economic growth, government shutdowns and geopolitical instability and tensions; significant weakening of the local economies in which we operate; changes in customer behaviors, including consumer spending, borrowing and saving habits; changes in deposit flows and loan demand; our failure to attract or retain key associates; expansions or consolidations in the Company's branch network, including that the anticipated benefits of the Company's branch acquisitions or the Company's branch network optimization project are not fully realized in a timely manner or at all; deterioration of the housing market and reduced demand for mortgages; and re-emergence of turbulence in significant portions of the global financial and real estate markets that could impact our performance, both directly, by affecting our revenues and the value of our assets and liabilities, and indirectly, by affecting the economy generally and access to capital in the amounts, at the times and on the terms required to support our future businesses. Many of these factors, as well as other factors, are described in our filings with the Securities and Exchange Commission, including in the "Risk Factors" section of the Company's Annual Report on Form 10-K for the year ended December 31, 2025. All risk factors and uncertainties described herein and therein should be considered in evaluating the Company's forward-looking statements. Forward-looking statements are based on beliefs and assumptions using information available at the time the statements are made. We caution you not to unduly rely on forward-looking statements because the assumptions, beliefs, expectations and projections about future events are expressed in or implied by a forward-looking statement may, and often do, differ materially from actual results. Any forward-looking statement speaks only as to the date on which it is made, and we undertake no obligation to update, revise or clarify any forward-looking statement to reflect developments occurring after the statement is made, except as required by law. Carter Bankshares, Inc. [email protected] CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA BALANCE SHEETS CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA INCOME STATEMENTS *All outstanding unvested restricted stock awards are considered participating securities for the earnings per share calculation. As such, these shares have been allocated to a portion of net income ($1,069 thousand, $104 thousand and $93 thousand for the quarters ended March 31, 2026, December 31, 2025 and March 31, 2025, respectively) and are excluded from the diluted earnings per share calculation. CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA NET INTEREST MARGIN (FTE) (QTD AVERAGES) (Unaudited) a Nonaccruing loans are included in the daily average loan amounts outstanding. CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA LOANS AND LOANS HELD-FOR-SALE (Unaudited) ASSET QUALITY DATA (Unaudited) CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA ALLOWANCE FOR CREDIT LOSSES (Unaudited) CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA DEFINITIONS AND RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES: (Unaudited) 4 Net interest income has been computed on a fully taxable equivalent basis ("FTE") using 21% federal income tax rate for the 2026 and 2025 periods. SOURCE: Carter Bankshares, Inc. View the original press release on ACCESS Newswire

Carter Bankshares, Inc. (CARE) came out with quarterly earnings of $0.4 per share, missing the Zacks Consensus Estimate of $3.91 per share. This compares to earnings of $0.32 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -89.76%. A quarter ago, it was expected that this company would post earnings of $0.33 per share when it actually produced earnings of $0.41, delivering a surprise of +24.24%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Carter Bankshares, which belongs to the Zacks Banks - Northeast industry, posted revenues of $107.06 million for the quarter ended March 2026, missing the Zacks Consensus Estimate by 11.48%. This compares to year-ago revenues of $37.22 million. The company has not been able to beat consensus revenue estimates over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Carter Bankshares shares have added about 24% since the beginning of the year versus the S&P 500's gain of 4.3%. While Carter Bankshares has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Carter Bankshares was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.43 on $44.49 million in revenues for the coming quarter and $5.44 on $257.89 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Banks - Northeast is currently in the top 38% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Capital Bancorp (CBNK), another stock in the same industry, has yet to report results for the quarter ended March 2026. This company is expected to post quarterly earnings of $0.81 per share in its upcoming report, which represents a year-over-year change of -8%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Capital Bancorp's revenues are expected to be $63 million, up 7.5% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Carter Bankshares, Inc. (CARE) : Free Stock Analysis Report Capital Bancorp, Inc. (CBNK) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Wall Street expects a year-over-year increase in earnings on higher revenues when Carter Bankshares, Inc. (CARE) reports results for the quarter ended March 2026. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates. The earnings report might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower. While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise. This company is expected to post quarterly earnings of $3.91 per share in its upcoming report, which represents a year-over-year change of +1121.9%. Revenues are expected to be $120.95 million, up 225% from the year-ago quarter. The consensus EPS estimate for the quarter has been revised 3.61% higher over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction). The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For Carter Bankshares, the Most Accurate Estimate is the same as the Zacks Consensus Estimate, suggesting that there are no recent analyst views which differ from what have been considered to derive the consensus estimate. This has resulted in an Earnings ESP of 0%. On the other hand, the stock currently carries a Zacks Rank of #3. So, this combination makes it difficult to conclusively predict that Carter Bankshares will beat the consensus EPS estimate. While calculating estimates for a company's future earnings, analysts often consider to what extent it has been able to match past consensus estimates. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that Carter Bankshares would post earnings of $0.33 per share when it actually produced earnings of $0.41, delivering a surprise of +24.24%. Over the last four quarters, the company has beaten consensus EPS estimates three times. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. Carter Bankshares doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. Among the stocks in the Zacks Banks - Northeast industry, Atlantic Union (AUB), is soon expected to post earnings of $0.88 per share for the quarter ended March 2026. This estimate indicates a year-over-year change of +54.4%. This quarter's revenue is expected to be $381.58 million, up 75.8% from the year-ago quarter. The consensus EPS estimate for Atlantic Union has been revised 0.4% lower over the last 30 days to the current level. However, a lower Most Accurate Estimate has resulted in an Earnings ESP of -5.47%. When combined with a Zacks Rank of #3 (Hold), this Earnings ESP makes it difficult to conclusively predict that Atlantic Union will beat the consensus EPS estimate. Over the last four quarters, the company surpassed consensus EPS estimates two times. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Carter Bankshares, Inc. (CARE) : Free Stock Analysis Report Atlantic Union Bankshares Corporation (AUB) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Unity Bancorp (UNTY) came out with quarterly earnings of $1.4 per share, beating the Zacks Consensus Estimate of $1.37 per share. This compares to earnings of $1.13 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +2.19%. A quarter ago, it was expected that this bank holding company would post earnings of $1.35 per share when it actually produced earnings of $1.41, delivering a surprise of +4.44%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Unity Bancorp, which belongs to the Zacks Banks - Northeast industry, posted revenues of $33.61 million for the quarter ended March 2026, surpassing the Zacks Consensus Estimate by 0.03%. This compares to year-ago revenues of $29.35 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Unity Bancorp shares have added about 8.7% since the beginning of the year versus the S&P 500's gain of 0.6%. While Unity Bancorp has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Unity Bancorp was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.43 on $34.77 million in revenues for the coming quarter and $5.78 on $140.68 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Banks - Northeast is currently in the top 38% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, Carter Bankshares, Inc. (CARE), is yet to report results for the quarter ended March 2026. This company is expected to post quarterly earnings of $3.91 per share in its upcoming report, which represents a year-over-year change of +1121.9%. The consensus EPS estimate for the quarter has been revised 3.6% higher over the last 30 days to the current level. Carter Bankshares, Inc.'s revenues are expected to be $120.95 million, up 225% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Unity Bancorp, Inc. (UNTY) : Free Stock Analysis Report Carter Bankshares, Inc. (CARE) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Carter Bankshares, Inc. (CARE) came out with quarterly earnings of $0.41 per share, beating the Zacks Consensus Estimate of $0.33 per share. This compares to earnings of $0.37 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +24.24%. A quarter ago, it was expected that this company would post earnings of $0.39 per share when it actually produced earnings of $0.26, delivering a surprise of -33.33%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Carter Bankshares, which belongs to the Zacks Banks - Northeast industry, posted revenues of $39.99 million for the quarter ended December 2025, missing the Zacks Consensus Estimate by 2.52%. This compares to year-ago revenues of $34.7 million. The company has topped consensus revenue estimates just once over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Carter Bankshares shares have added about 1.3% since the beginning of the year versus the S&P 500's gain of 1.9%. While Carter Bankshares has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Carter Bankshares was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.38 on $40.93 million in revenues for the coming quarter and $1.90 on $174.02 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Banks - Northeast is currently in the top 23% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, Meridian Bank (MRBK), has yet to report results for the quarter ended December 2025. This company is expected to post quarterly earnings of $0.55 per share in its upcoming report, which represents a year-over-year change of +12.2%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Meridian Bank's revenues are expected to be $32.18 million, up 12.6% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Carter Bankshares, Inc. (CARE) : Free Stock Analysis Report Meridian Bank (MRBK) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

MARTINSVILLE, VA / ACCESS Newswire / January 29, 2026 / Carter Bankshares, Inc. (the "Company") (NASDAQ:CARE), the holding company of Carter Bank (the "Bank") today announced quarterly net income of $8.5 million, or $0.38 diluted earnings per share ("EPS"), for the fourth quarter of 2025 compared to net income of $5.4 million, or $0.24 diluted EPS, for the third quarter of 2025 and net income of $8.3 million, or $0.36 diluted EPS, for the fourth quarter of 2024. Net interest income was $34.6 million for the fourth quarter of 2025, $33.7 million for the third quarter of 2025, and $29.1 million for the fourth quarter of 2024. Pre-tax pre-provision income1 was $8.8 million for the fourth quarter of 2025, $10.4 million for the third quarter of 2025 and $5.7 million for the fourth quarter of 2024. For the year ended December 31, 2025, net income was $31.4 million, or $1.38 diluted EPS, compared to net income of $24.5 million, or $1.06 diluted EPS for the year ended December 31, 2024. Net interest income was $130.8 million for the year ended December 31, 2025 and $114.5 million for the year ended December 31, 2024. Pre-tax pre-provision income1 was $36.2 million and $25.8 million for the years ended December 31, 2025 and 2024, respectively. The Company's financial results continue to be significantly impacted by loans in the Bank's Other segment of the Company's loan portfolio, the significant majority of which have been on nonaccrual status since the second quarter of 2023. The Bank's loans, now reduced to judgments, relate to various entities in which James C. Justice, II has an interest (collectively, the "Justice Entities"), remain the Bank's largest credit relationship and comprise the significant majority of the Other segment with an aggregate principal balance of $214.0 million as of December 31, 2025. Interest income was negatively impacted by $6.1 million during the fourth quarter of 2025, $6.5 million during the third quarter of 2025 and $7.9 million during the fourth quarter of 2024, due to these credits being on nonaccrual status. The negative impact to interest income during the years ended December 31, 2025 and December 31, 2024, was $26.1 million and $35.1 million, respectively. Interest income has been negatively impacted by $91.2 million in the aggregate since placement of these credits on nonaccrual status during the second quarter of 2023. As of December 31, 2025, $87.9 million of aggregate curtailment payments made by the Justice Entities to the Bank have decreased the aggregate nonperforming loan ("NPL") principal balance from $301.9 million as of June 30, 2023 to $214.0 million as of December 31, 2025. Curtailment payments received during the fourth quarter of 2025 and the year ended December 31, 2025 totaled $14.5 million and $38.0 million, respectively. For additional information regarding the Bank's credit relationship with the Justice Entities, see "Credit Quality." Fourth Quarter and Full Year 2025 Financial Highlights Total portfolio loans increased $43.9 million, or 4.5%, on an annualized basis, to $3.9 billion at December 31, 2025 from September 30, 2025 and increased $254.7 million, or 7.0%, from December 31, 2024; Net interest income totaled $34.6 million in the fourth quarter of 2025, an increase of $0.9 million, or 2.6%, from the prior quarter and an increase of $5.5 million, or 18.7%, compared to the fourth quarter of 2024. Net interest income was $130.8 million for the year ended December 31, 2025, an increase of $16.4 million, or 14.3%, compared to the year ended December 31, 2024; Net interest margin increased six basis points to 2.92% in the fourth quarter of 2025 compared to the prior quarter and increased 35 basis points compared to the year over year quarter. Net interest income and net interest margin continue to be significantly impacted by the Bank's largest lending relationship remaining on nonaccrual status since the second quarter of 2023; NPLs decreased by $14.7 million to $244.0 million at December 31, 2025 compared to September 30, 2025. NPLs to total portfolio loans were 6.29% at December 31, 2025, 6.74% at September 30, 2025 and 7.15% at December 31, 2024; The (recovery) for credit losses was $2.2 million for the fourth quarter of 2025, compared to a provision of $2.9 million for the third quarter of 2025 and a (recovery) of $5.1 million for the fourth quarter of 2024. The (recovery) provision for credit losses continues to be significantly impacted by curtailment payments and related Other segment reserve release in connection with the Bank's largest lending relationship; The allowance for credit losses to total portfolio loans was 1.84%, 1.92% and 2.09% at December 31, 2025, September 30, 2025 and December 31, 2024, respectively; and The efficiency ratio was 77.84%, 73.43% and 83.63%, and the adjusted efficiency ratio (non-GAAP)4 was 76.85%, 73.37%, and 82.76% for the quarters ended December 31, 2025, September 30, 2025 and December 31, 2024, respectively. The efficiency ratio for the fourth quarter of 2025 continues to be impacted by the Bank's largest lending relationship that was placed in nonaccrual status during the second quarter of 2023. "We are pleased to report continued strong fundamentals and positive trends for the fourth quarter and for the full year 2025. During the quarter, we again realized margin expansion and solid loan growth throughout our footprint. Our annual loan growth of 7.0% reflects good momentum in our commercial lending platform. In the second half of 2025, we were fortunate to add new seasoned commercial lending teams in Western North Carolina, and we also entered South Carolina with the establishment of a commercial lending presence in Greenville. Our loan pipeline remains healthy and we continue to expect a tailwind from prior construction lending that will fund online over the coming 12 to 18 months as projects progress. Our balance sheet remains slightly liability sensitive. As the Federal Reserve continues to reduce short-term interest rates, we believe we are well positioned to benefit, including with further margin expansion, especially given the short-term nature of our certificates of deposit ("CD") portfolio," stated Litz H. Van Dyke, Chief Executive Officer. Van Dyke concluded, "Although our large nonperforming credit relationship continues to have a negative impact on our financial and credit metrics, aside from this impact, our fundamentals, financial performance, and asset quality metrics all remain solid. We are committed to resolving this lending relationship in a manner that is most beneficial to our Company and our shareholders. We continue to believe we are well positioned for a strong 2026 and beyond." Operating Highlights Credit Quality NPLs as a percentage of total portfolio loans declined to 6.29% at December 31, 2025, compared to 6.74% at September 30, 2025 and 7.15% at December 31, 2024. Total NPLs decreased $14.7 million to $244.0 million from September 30, 2025 and decreased $15.4 million from December 31, 2024. The quarter-over-quarter decline was primarily driven by $14.5 million of curtailment payments received during the fourth quarter of 2025 from the Bank's largest nonperforming lending relationship. The year-over-year decrease was also attributable to total curtailment payments of $38.0 million received during 2025, partially offset by the transfer of certain loans to nonperforming status, including a $9.5 million commercial real estate ("CRE") relationship consisting of four loans during the first quarter of 2025, a $14.3 million CRE loan during the third quarter of 2025 and a $0.8 million residential mortgage loan during the third quarter of 2025. The $14.3 million CRE loan is secured by an office building that government agency tenants vacated during the fourth quarter of 2025. While this CRE loan was originated at a relatively low loan-to-value ratio, an updated appraisal was received in the fourth quarter of 2025 and a $1.0 million specific reserve was established. The Company believes it is well secured based on the net carrying value of the credit. The Bank continues to closely monitor this CRE loan and other similar loans in its CRE portfolio for changes in valuation and other market impacts. Since the Bank's largest lending relationship was transferred to nonaccrual status, in the second quarter of 2023 due to loan maturities and failure to pay in full, this relationship's NPL balance has decreased from $301.9 million at June 30, 2023 to $214.0 million at December 31, 2025. Note that, because U.S. GAAP requires the full amount of each curtailment payment to be applied to this relationship's NPL balance, this relationship's total legal obligations to the Bank significantly exceed the NPL balance. This NPL relationship represents 87.7% of total NPLs and 5.5% of total portfolio loans at December 31, 2025. The Company continues to believe it is well secured based on the net carrying value of the credit relationship and is appropriately reserved for potential credit losses with respect to all such loans based on information currently available. However, the Company cannot give any assurance as to the timing or amount of future payments or collections on such loans or that the Company will ultimately collect all amounts contractually due under the terms of such loans. The specific reserves with respect to the Bank's largest NPL credit relationship were $18.0 million at December 31, 2025 compared to $21.7 million at September 30, 2025. The decline during the fourth quarter of 2025 was driven by the aforementioned curtailment payments. The Company uses a discounted cash flow model to calculate the associated reserve. Each quarter, the model is updated to reflect changes in assumptions and inputs regarding the credit relationship, legal risk and related risks. The (recovery) for credit losses was $2.2 million for the fourth quarter of 2025, compared to a provision of $2.9 million for the third quarter of 2025 and a (recovery) of $5.1 million for the fourth quarter of 2024. The quarter-over-quarter improvement was driven primarily by a $3.7 million reduction in the reserve for the Other loan segment, reflecting a decrease in the reserve rate from 9.49% at September 30, 2025 to 8.43% at December 31, 2025. The change was a result of higher curtailment payments during the fourth quarter of 2025 compared to the prior quarter. These improvements were partially offset by the establishment of a new $1.0 million specific reserve on the CRE loan discussed above during the fourth quarter of 2025 resulting from an updated appraisal, offset by a net $0.6 million decrease in a specific reserve related to an existing CRE loan under contract to sell and the establishment of $1.1 million in general reserves associated with new loan originations during the fourth quarter. During the fourth quarter of 2025, the (recovery) for unfunded commitments was a (recovery) of $80 thousand compared to a provision of $335 thousand in the third quarter of 2025 and a provision of $81 thousand in the fourth quarter of 2024. The change from the prior quarter was primarily due to decreased unfunded commitments in construction loans. Net Interest Income Net interest income for the fourth quarter of 2025 increased $0.9 million to $34.6 million compared to the third quarter of 2025 and increased $5.5 million compared to the fourth quarter of 2024. The linked-quarter increase was primarily driven by a nine basis point decline in funding costs, partially offset by a two basis point decrease in the yield on average interest-earning assets. The year-over-year increase was primarily attributable to a 43 basis point decline in funding costs and a three basis point increase in the yield on average interest-earning assets. On an FTE basis,3 net interest income totaled $34.8 million and $131.5 million for the three months and year ended December 31, 2025, respectively, representing increases of $5.4 million and $16.3 million compared to the same periods in the prior year. Net interest income for both the three months and year ended December 31, 2025 was positively impacted by lower rates paid on average interest-bearing liabilities and higher loan balances compared to the prior year periods. These benefits were partially offset by declines in both the average securities balances and yields on securities during the three months and year ended December 31, 2025. Net interest margin was 2.92% and 2.82% for the three months and year ended December 31, 2025, respectively, compared to 2.57% for both periods ended December 31, 2024. On an FTE basis,3 net interest margin was 2.93% and 2.83% for the three months and year ended December 31, 2025, respectively, compared to 2.58% for both periods ended December 31, 2024. During 2025, interest-bearing funding costs benefited from the Federal Reserve's prior 100 basis point reduction in the federal funds target rate during the third and fourth quarters of 2024. In addition, the Federal Reserve's most recent 75 basis point reduction in the federal funds target rate during the third and fourth quarters of 2025 continues to allow the Company to lower interest-bearing funding costs. Noninterest Income Noninterest income was $5.2 million for the fourth quarter of 2025, a decrease of $0.1 million, compared to both the third quarter of 2025, and the fourth quarter of 2024. The primary driver of the decreases was lower insurance commissions, partially offset by an increase in BOLI income. For the full year 2025, noninterest income was $22.4 million, an increase of $1.0 million, or 4.8% compared to the same period in 2024. This growth was primarily due to a $2.0 million increase in other noninterest income, partially offset by a $1.0 million decline in insurance commissions. The increase in other noninterest income included a $1.9 million gain on a BOLI death benefit recorded in the first quarter of 2025. The decline in insurance commissions was due to lower activity during 2025. Noninterest Expense Noninterest expense totaled $31.0 million in the fourth quarter of 2025, representing an increase of $2.3 million, or 8.0%, compared to the prior quarter. The linked-quarter increase was primarily driven by higher seasonal salaries and employee benefits, elevated medical claims and lower deferred compensation associated with lower loan growth in the fourth quarter of 2025 as compared to the third quarter of 2025. Compared to the fourth quarter of 2024, noninterest expense increased by $2.1 million. This year-over-year increase was driven primarily by higher salaries and employee benefits of $1.1 million, professional and legal fees of $0.4 million, debit card expenses of $0.3 million and occupancy expense of $0.2 million. For the year ended December 31, 2025, noninterest expense was $117.1 million, an increase of $7.1 million, or 6.4%, compared to 2024. The increase was primarily driven by higher other noninterest expense of $2.3 million, occupancy expenses of $2.0 million, professional and legal fees of $1.2 million, data processing expenses of $0.8 million, debit card expenses of $0.8 million and advertising expenses of $0.6 million. These increases were partially offset by a $0.4 million decrease in FDIC insurance expense. The increase in other noninterest expense was primarily attributable to $1.1 million of OREO related activity, $0.7 million of fees associated with 1035 exchanges resulting from the early surrender of certain BOLI policies during 2025 and $0.2 million amortization expense related to core deposit intangibles. The increase in occupancy expense was driven by higher software maintenance costs and increased depreciation. Professional and legal fees increased during the year primarily due to acquisition-related activity, consulting costs related to troubled or nonperforming loans, and higher expenses associated with the management of special assets. Data processing expenses increased primarily due to inflationary cost increases related to existing and new service agreements. Debit card expenses increased during the year driven by higher miscellaneous fees and elevated costs associated with ATM and debit card fraud activity. Advertising expense increased primarily due to higher spending related to rebranding initiatives and expanded new account promotions and advertising campaigns. The decline in FDIC insurance expense reflected reduced loan balances associated with the Company's largest nonperforming lending relationship. Financial Condition Total assets increased $11.8 million to $4.9 billion at December 31, 2025 compared to September 30, 2025. Cash and due from banks decreased $1.8 million to $105.2 million at December 31, 2025 compared to September 30, 2025. Available-for-sale securities decreased $36.3 million to $691.6 million compared to September 30, 2025. These securities represented 14.3% of total assets at December 31, 2025, down slightly from 15.0% at September 30, 2025. The decrease was primarily driven by sales, and normal paydowns, partially offset by a reduction in unrealized losses and purchases of securities during the fourth quarter. Total portfolio loans increased $43.9 million, or 4.5%, on an annualized basis, to $3.9 billion at December 31, 2025 compared to September 30, 2025. The breakdown of loan growth compared to September 30, 2025 related to the following increases: $51.1 million in CRE loans and $13.9 million in commercial and industrial ("C&I"), partially offset by the following decreases: $14.5 million in Other due to curtailment payments, $4.8 million in residential mortgages, $1.1 million in construction, and $0.7 million in other consumer. Total deposits increased slightly by $0.5 million to $4.2 billion at December 31, 2025 compared to September 30, 2025. Federal Home Loan Bank ("FHLB") borrowings increased $3.0 million to $178.5 million at December 31, 2025 compared to September 30, 2025 to help fund loan growth. As of December 31, 2025, approximately 81.3% of our $4.2 billion in total deposits were insured within standard Federal Deposit Insurance Corporation ("FDIC") coverage limits, while approximately 18.7% were uninsured deposits exceeding those limits, compared to 81.6% insured and 18.4% uninsured at September 30, 2025. Capitalization and Liquidity The Company remained well capitalized at December 31, 2025. The Company's Tier 1 Capital ratio was 10.70% at December 31, 2025 as compared to 10.66% at September 30, 2025. The Company's leverage ratio was 9.43% at December 31, 2025 as compared to 9.41% at September 30, 2025. The Company's Total Risk-Based Capital ratio was 11.95% at December 31, 2025 as compared to 11.91% at September 30, 2025. During the three months and year ended December 31, 2025, the Company repurchased 315,089 and 1,124,690 shares of its common stock at a total cost of $6.0 million and $20.0 million, respectively, at weighted average cost per share of $18.91 and $17.78, respectively. At December 31, 2025, funding sources accessible to the Company include borrowing availability at the FHLB, equal to 30.0% of the Company's assets or approximately $1.5 billion, subject to the amount of eligible collateral pledged, of which the Company is eligible to borrow up to an additional $609.4 million. The Company has unsecured facilities with three other correspondent financial institutions totaling $30.0 million, a fully secured facility with one other correspondent financial institution totaling $45.0 million, and access to the institutional CD market. The Company did not have outstanding borrowings on these federal funds lines as of December 31, 2025. In addition to the above funding resources, the Company also has $402.2 million of unpledged available-for-sale investment securities, at fair value, as an additional source of liquidity. About Carter Bankshares, Inc. Headquartered in Martinsville, VA, Carter Bankshares, Inc. (NASDAQ:CARE) provides a full range of commercial banking, consumer banking, mortgage and services through its subsidiary Carter Bank. The Company has $4.9 billion in assets and 64 branches in Virginia and North Carolina as of December 31, 2025. For more information or to open an account visit www.carterbank.com. Important Note Regarding Non-GAAP Financial Measures In addition to the results of operations presented in accordance with generally accepted accounting principles in the United States ("GAAP"), our management uses, and this press release contains or references, certain non-GAAP financial measures and should be read along with the accompanying tables in our definitions and reconciliations of GAAP to non-GAAP financial measures. This press release and the accompanying tables discuss financial measures that we believe are useful because they enhance the ability of investors and management to evaluate and compare the Company's operating results from period to period in a meaningful manner. Management also believes these measures provide information useful to investors in understanding our underlying business, operational performance and performance trends as these measures facilitate comparisons with the performance of other companies in the financial services industry. The Company also believes the presentation of interest and dividend income, yield on interest-earning assets, net interest income and net interest margin on an FTE basis ensures the comparability of interest and dividend income, yield on interest earning assets, net interest income and net interest margin arising from both taxable and tax-exempt sources and is consistent with industry practice. Although management believes that these non-GAAP financial measures enhance investors' understanding of its business and performance, these non-GAAP measures should not be considered as an alternative to GAAP or considered to be more relevant than financial results determined in accordance with GAAP, nor are they necessarily comparable with similar non-GAAP measures that may be presented by other companies. Investors should consider the Company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company's results or financial condition as reported under GAAP. Important Note Regarding Forward-Looking Statements This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements made in Mr. Van Dyke's quotations and may include statements relating to our financial condition, market conditions, results of operations, plans, including our strategic plan, brand strategy, and guiding principles and the anticipated results of the foregoing, objectives, outlook for earnings, revenues, expenses, capital and liquidity levels and ratios, asset levels, asset quality, loan pipeline and nonaccrual and nonperforming loans. Forward looking statements are typically identified by words or phrases such as "will likely result," "expect," "anticipate," "estimate," "forecast," "project," "intend," "believe," "assume," "strategy," "trend," "plan," "outlook," "outcome," "continue," "remain," "potential," "opportunity," "comfortable," "current," "position," "maintain," "sustain," "seek," "achieve" and variations of such words and similar expressions, or future or conditional verbs such as will, would, should, could or may. These statements are not guarantees of future results or performance and involve certain risks, uncertainties and assumptions that are difficult to predict and often are beyond the Company's control. Although we believe the assumptions upon which these forward-looking statements are based are reasonable, any of these assumptions could prove to be inaccurate and the forward-looking statements based on these assumptions could be incorrect. Actual results may differ significantly from those expressed in or implied by these forward-looking statements. The matters discussed in these forward-looking statements are subject to various risks, uncertainties and other factors that could cause actual results and trends to differ materially from those made, projected, or implied in or by the forward-looking statements including, but not limited to the effects of: market interest rates and the impacts of market interest rates on economic conditions, customer behavior, and the Company's net interest margin, net interest income, funding costs and its deposit, loan and securities portfolios; inflation, market and monetary fluctuations; changes in trade policies, tariffs, monetary and fiscal policies and laws of the U.S. government and the related impacts on economic conditions and financial markets, and changes in policies of the Federal Reserve, FDIC and U.S. Department of the Treasury; changes in accounting policies, practices, or guidance, for example, our adoption of Current Expected Credit Losses ("CECL") methodology, including potential volatility in the Company's operating results due to application of the CECL methodology; cyber-security threats, attacks or events; rapid technological developments and changes; our ability to resolve our nonperforming assets and our ability to secure collateral on loans that have entered nonaccrual status due to loan maturities and failure to pay in full; changes in the Company's liquidity and capital positions; concentrations of loans secured by real estate, particularly CRE loans, and the potential impacts of changes in market conditions on the value of real estate collateral; increased delinquency and foreclosure rates on CRE loans; an insufficient allowance for credit losses; the potential adverse effects of unusual and infrequently occurring events, such as weather-related disasters, terrorist acts, war and other geopolitical conflicts or public health events (such as pandemics), and of any governmental and societal responses thereto; these potential adverse effects may include, without limitation, adverse effects on the ability of the Company's borrowers to satisfy their obligations to the Company, on the value of collateral securing loans, on the demand for the Company's loans or its other products and services, on incidents of cyberattack and fraud, on the Company's liquidity or capital positions, on risks posed by reliance on third-party service providers, on other aspects of the Company's business operations and on financial markets and economic growth; a change in spreads on interest-earning assets and interest-bearing liabilities; regulatory supervision and oversight, including our relationship with regulators and any actions that may be initiated by our regulators; legislation affecting the financial services industry as a whole, and the Company and the Bank, in particular and changes impacting the rulemaking, supervision, examination and enforcement priorities of the federal banking agencies; the outcome of pending and future litigation and/or governmental proceedings; increasing price and product/service competition; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; managing our internal growth and acquisitions; the possibility that the anticipated benefits from acquisitions cannot be fully realized in a timely manner or at all, or that integrating acquired operations will be more difficult, disruptive or more costly than anticipated; the soundness of other financial institutions and any indirect exposure related to large bank failures and their impact on the broader market through other customers, suppliers and partners or that the conditions which resulted in the liquidity concerns with those failed banks may also adversely impact, directly or indirectly, other financial institutions and market participants with which the Company has commercial or deposit relationships with; material increases in costs and expenses; reliance on significant customer relationships; general economic or business conditions, including unemployment levels, supply chain disruptions, slowdowns in economic growth, government shutdowns and geopolitical instability and tensions; significant weakening of the local economies in which we operate; changes in customer behaviors, including consumer spending, borrowing and saving habits; changes in deposit flows and loan demand; our failure to attract or retain key associates; expansions or consolidations in the Company's branch network, including that the anticipated benefits of the Company's branch acquisitions or the Company's branch network optimization project are not fully realized in a timely manner or at all; deterioration of the housing market and reduced demand for mortgages; and re-emergence of turbulence in significant portions of the global financial and real estate markets that could impact our performance, both directly, by affecting our revenues and the value of our assets and liabilities, and indirectly, by affecting the economy generally and access to capital in the amounts, at the times and on the terms required to support our future businesses. Many of these factors, as well as other factors, are described in our filings with the Securities and Exchange Commission, including in the "Risk Factors" section of the Company's Annual Report on Form 10-K for the year ended December 31, 2024. All risk factors and uncertainties described herein and therein should be considered in evaluating the Company's forward-looking statements. Forward-looking statements are based on beliefs and assumptions using information available at the time the statements are made. We caution you not to unduly rely on forward-looking statements because the assumptions, beliefs, expectations and projections about future events are expressed in or implied by a forward-looking statement may, and often do, differ materially from actual results. Any forward-looking statement speaks only as to the date on which it is made, and we undertake no obligation to update, revise or clarify any forward-looking statement to reflect developments occurring after the statement is made, except as required by law. Carter Bankshares, Inc. [email protected] CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA BALANCE SHEETS CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA INCOME STATEMENTS *All outstanding unvested restricted stock awards are considered participating securities for the earnings per share calculation. As such, these shares have been allocated to a portion of net income ($104 thousand, $68 thousand and $85 thousand for the quarters ended December 31, 2025, September 30, 2025 and December 31, 2024, respectively and $361 thousand and $248 thousand for the years ended December 31, 2025 and 2024, respectively) and are excluded from the diluted earnings per share calculation. CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA NET INTEREST MARGIN (FTE) (QTD AVERAGES) (Unaudited) CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA NET INTEREST MARGIN (FTE) (YTD AVERAGES) (Unaudited) CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA LOANS AND LOANS HELD-FOR-SALE (Unaudited) ASSET QUALITY DATA (Unaudited) CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA ALLOWANCE FOR CREDIT LOSSES (Unaudited) DEFINITIONS AND RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES: (Unaudited) CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA 3 Net interest income has been computed on a fully taxable equivalent basis ("FTE") using 21% federal income tax rate for the 2025 and 2024 periods. CARTER BANKSHARES, INC. CONSOLIDATED SELECTED FINANCIAL DATA SOURCE: Carter Bankshares, Inc. View the original press release on ACCESS Newswire

CB Financial Services (CBFV) came out with quarterly earnings of $0.72 per share, missing the Zacks Consensus Estimate of $0.83 per share. This compares to earnings of $0.35 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -13.25%. A quarter ago, it was expected that this holding company for Pennsylvania-based Community Bank would post earnings of $0.66 per share when it actually produced earnings of $0.74, delivering a surprise of +12.12%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. CB Financial Services, which belongs to the Zacks Banks - Northeast industry, posted revenues of $15.56 million for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 2.34%. This compares to year-ago revenues of $13.19 million. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. CB Financial Services shares have added about 0.7% since the beginning of the year versus the S&P 500's gain of 1.5%. While CB Financial Services has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for CB Financial Services was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.75 on $14.8 million in revenues for the coming quarter and $3.26 on $60.9 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Banks - Northeast is currently in the top 22% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Carter Bankshares, Inc. (CARE), another stock in the same industry, has yet to report results for the quarter ended December 2025. This company is expected to post quarterly earnings of $0.33 per share in its upcoming report, which represents a year-over-year change of -10.8%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Carter Bankshares, Inc.'s revenues are expected to be $41.02 million, up 18.2% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CB Financial Services, Inc. (CBFV) : Free Stock Analysis Report Carter Bankshares, Inc. (CARE) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research