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Keep track of this season's goals with First Bank and the Carolina Hurricanes at www.localfirstbank.com/canes. , /PRNewswire/ -- Building on the success of last season's initiative, which generated nearly $27,000 for the Carolina Hurricanes Foundation, First Bank is strengthening its commitment to the Carolinas by extending its partnership with and sponsorship of the Carolina Hurricanes for an additional three years. First Bank is a proud supporter of the Carolina Hurricanes Foundation. Through the Good Goa ...

Part I. Financial Information [Item 1 - Financial Statements (unaudited)](index=4&type=section&id=Item%201%20-%20Financial%20Statements%20(unaudited)) This section presents First Bancorp's unaudited consolidated financial statements, including Balance Sheets, Statements of Income, Comprehensive Income (Loss), Shareholders' Equity, and Cash Flows, with detailed notes on organization, accounting policies, and financial instruments [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) | Metric | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :-------------------------------- | :------------------------------ | :------------------------------- | :---------------------- | :--------- | | Total assets | 12,608,265 | 12,147,694 | 460,571 | 3.79% | | Total cash and cash equivalents | 711,286 | 507,507 | 203,779 | 40.15% | | Net loans | 8,105,105 | 7,972,104 | 133,001 | 1.67% | | Total deposits | 10,830,380 | 10,530,525 | 299,855 | 2.85% | | Total liabilities | 11,052,085 | 10,702,083 | 350,002 | 3.27% | | Total shareholders' equity | 1,556,180 | 1,445,611 | 110,569 | 7.65% | [Consolidated Statements of Income](index=5&type=section&id=Consolidated%20Statements%20of%20Income) | Metric | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------- | :--------- | | Total interest income | 136,741 | 128,822 | 7,919 | 6.15% | | Total interest expense | 40,065 | 47,707 | (7,642) | -16.02% | | Net interest income | 96,676 | 81,115 | 15,561 | 19.18% | | Provision for credit losses | 2,212 | 541 | 1,671 | 308.87% | | Total noninterest income | 14,341 | 14,601 | (260) | -1.78% | | Total noninterest expenses | 58,983 | 58,291 | 692 | 1.19% | | Net income | 38,566 | 28,712 | 9,854 | 34.30% | | Basic EPS | 0.93 | 0.70 | 0.23 | 32.86% | | Diluted EPS | 0.93 | 0.70 | 0.23 | 32.86% | | Metric | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | Change (%) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------- | :--------- | | Total interest income | 269,401 | 255,436 | 13,965 | 5.47% | | Total interest expense | 79,842 | 95,047 | (15,205) | -16.00% | | Net interest income | 189,559 | 160,389 | 29,170 | 18.19% | | Provision for credit losses | 3,328 | 1,741 | 1,587 | 91.15% | | Total noninterest income | 27,243 | 27,497 | (254) | -0.92% | | Total noninterest expenses | 116,876 | 117,478 | (602) | -0.51% | | Net income | 74,972 | 53,984 | 20,988 | 38.88% | | Basic EPS | 1.81 | 1.31 | 0.50 | 38.17% | | Diluted EPS | 1.81 | 1.31 | 0.50 | 38.17% | [Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) | Metric | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------- | | Net income | 38,566 | 28,712 | 9,854 | | Other comprehensive income (loss) | 17,110 | 6,782 | 10,328 | | Comprehensive income (loss) | 55,676 | 35,494 | 20,182 | | Metric | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------- | | Net income | 74,972 | 53,984 | 20,988 | | Other comprehensive income (loss) | 52,511 | (7,161) | 59,672 | | Comprehensive income (loss) | 127,483 | 46,823 | 80,660 | [Consolidated Statements of Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Shareholders'%20Equity) | Metric | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | Change ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------- | | Total shareholders' equity | 1,556,180 | 1,445,611 | 110,569 | | Retained earnings | 812,657 | 756,327 | 56,330 | | Accumulated other comprehensive income (loss) | (229,518) | (282,029) | 52,511 | - For the six months ended June 30, 2025, the company declared cash dividends of **$0.45 per common share**, totaling **$18.642 million**; stock repurchases amounted to **$0.992 million**[20](index=20&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) | Cash Flow Activity | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------- | | Net cash provided by (used in) operating activities | 98,307 | 67,630 | 30,677 | | Net cash provided by (used in) investing activities | (175,353) | 403,343 | (578,696) | | Net cash provided by (used in) financing activities | 280,825 | (100,416) | 381,241 | | Increase (decrease) in cash and cash equivalents | 203,779 | 370,557 | (166,778) | | Cash and cash equivalents, end of period | 711,286 | 608,412 | 102,874 | - Cash paid for interest decreased by **$14.612 million (15.49%)** from **$94.342 million** in H1 2024 to **$79.730 million** in H1 2025[25](index=25&type=chunk) - Cash paid for income taxes decreased by **$5.546 million (38.56%)** from **$14.382 million** in H1 2024 to **$8.836 million** in H1 2025[25](index=25&type=chunk) [Notes to Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) [Note 1. Organization and Basis of Presentation](index=11&type=section&id=Note%201.%20Organization%20and%20Basis%20of%20Presentation) - The consolidated financial statements include First Bancorp, its wholly-owned subsidiary First Bank, and First Bank's subsidiaries Magnolia Financial, Inc. and First Troy SPE, LLC, with SBA Complete, Inc. becoming inactive in Q2 2024[28](index=28&type=chunk)[29](index=29&type=chunk) - The company did not adopt any new accounting standards in the first six months of 2025, with ASU 2023-09 (Income Tax Disclosures) and ASU 2024-03 (Expense Disaggregation Disclosures) pending adoption and no significant impact expected[33](index=33&type=chunk)[34](index=34&type=chunk)[35](index=35&type=chunk)[36](index=36&type=chunk) [Note 2. Securities](index=12&type=section&id=Note%202.%20Securities) | Security Type | Amortized Cost (June 30, 2025) ($ thousands) | Fair Value (June 30, 2025) ($ thousands) | Unrealized Losses (June 30, 2025) ($ thousands) | | :-------------------------- | :----------------------------- | :------------------------- | :-------------------------------- | | Securities available for sale | 2,443,724 | 2,144,831 | (303,483) | | Securities held to maturity | 516,405 | 431,420 | (84,987) | | Total unrealized loss position | 2,960,129 | 2,576,251 | (388,470) | - As of June 30, 2025, **548 out of 589 securities** were in an unrealized loss position, primarily due to interest rate factors rather than credit quality concerns, with no intent to sell before recovery of amortized cost[41](index=41&type=chunk)[42](index=42&type=chunk) - No sales of investment securities occurred during the three and six months ended June 30, 2025, contrasting with **$142.7 million** (Q2 2024) and **$148.0 million** (H1 2024) in proceeds from sales of securities and Visa Class B shares, which generated net losses of **$0.2 million** and **$1.2 million**, respectively, in the comparable 2024 periods[46](index=46&type=chunk)[47](index=47&type=chunk) [Note 3. Loans, Allowance for Credit Losses, and Asset Quality Information](index=14&type=section&id=Note%203.%20Loans,%20Allowance%20for%20Credit%20Losses,%20and%20Asset%20Quality%20Information) | Loan Category | June 30, 2025 (Amount in thousands) | June 30, 2025 (Percentage) | December 31, 2024 (Amount in thousands) | December 31, 2024 (Percentage) | | :------------------------------------ | :---------------------------------- | :------------------------- | :------------------------------------ | :------------------------- | | Commercial and industrial | 911,227 | 11% | 919,690 | 11% | | Construction, development & other land loans | 633,529 | 8% | 647,167 | 8% | | Commercial real estate - owner occupied | 1,254,596 | 15% | 1,248,812 | 16% | | Commercial real estate - non owner occupied | 2,758,629 | 34% | 2,625,554 | 33% | | Multi-family real estate | 509,419 | 6% | 506,407 | 6% | | Residential 1-4 family real estate | 1,731,397 | 21% | 1,729,322 | 21% | | Home equity loans/lines of credit | 355,876 | 4% | 345,883 | 4% | | Consumer loans | 70,137 | 1% | 70,653 | 1% | | Total loans | 8,225,650 | 100% | 8,094,676 | 100% | | Nonperforming Asset (NPA) | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | | :-------------------------------- | :------------------------------ | :------------------------------- | | Nonaccrual loans | 34,625 | 31,779 | | Foreclosed properties | 1,218 | 4,965 | | Total nonperforming assets | 35,843 | 36,744 | | Allowance for Credit Losses (ACL) Activity | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :----------------------------------------- | :------------------------------------ | :------------------------------------ | | Beginning balance | 122,572 | 109,853 | | Charge-offs | (5,874) | (4,772) | | Recoveries | 1,379 | 1,727 | | Provisions / (Reversals) | 2,468 | 3,250 | | Ending balance | 120,545 | 110,058 | - Loans to borrowers in areas impacted by Hurricane Helene totaled **$703 million** as of June 30, 2025, a decrease from **$755 million** at the time of the storm, with an ACL of **$7.5 million** contributing **10 basis points** to the overall ACL as a percent of total loans (1.47%)[75](index=75&type=chunk) [Note 4. Goodwill, Other Intangible Assets and Servicing Assets](index=25&type=section&id=Note%204.%20Goodwill,%20Other%20Intangible%20Assets%20and%20Servicing%20Assets) | Intangible Asset | Net Amount (June 30, 2025) ($ thousands) | Net Amount (December 31, 2024) ($ thousands) | | :------------------------- | :---------------------------------- | :------------------------------------ | | Customer lists | 53 | 213 | | Core deposit intangibles | 19,867 | 22,691 | | Total amortizable intangible assets | 19,920 | 22,904 | | Goodwill | 478,750 | 478,750 | - Amortization expense for intangible assets was **$1.5 million** for Q2 2025 (vs. **$1.7 million** in Q2 2024) and **$3.0 million** for H1 2025 (vs. **$3.4 million** in H1 2024), with no goodwill impairment identified in 2025[80](index=80&type=chunk)[81](index=81&type=chunk) - SBA guaranteed servicing fee income was **$0.7 million** for Q2 2025 (vs. **$0.8 million** in Q2 2024) and **$1.4 million** for H1 2025 (vs. **$1.5 million** in H1 2024), with the net balance of SBA servicing assets at **$2.029 million** as of June 30, 2025[83](index=83&type=chunk)[84](index=84&type=chunk) [Note 5. Borrowings](index=26&type=section&id=Note%205.%20Borrowings) | Borrowing Type | Balance (June 30, 2025) ($ thousands) | Interest Rate (June 30, 2025) | Balance (December 31, 2024) ($ thousands) | Interest Rate (December 31, 2024) | | :-------------------------- | :--------------------------------- | :---------------------------- | :----------------------------------- | :---------------------------- | | FHLB Principal Reducing Credit | 778 | 0.00% to 1.00% fixed | 802 | 0.00% to 1.00% fixed | | Trust Preferred Securities | 77,024 | 5.95% to 7.29% adjustable | 77,024 | 6.01% to 7.61% adjustable | | Subordinated Debentures | 18,000 | 4.38% fixed (until 11/15/25) | 18,000 | 4.38% fixed (until 11/15/25) | | Total borrowings (net of discount) | 92,237 | 6.09% (weighted average) | 91,876 | 6.22% (weighted average) | [Note 6. Leases](index=27&type=section&id=Note%206.%20Leases) - The company leases **13 bank branch offices** (land and buildings) and **10 branch offices** (land only), along with other office space, all as operating leases with maturity dates ranging from April 2026 to May 2076, including extension options[87](index=87&type=chunk) | Lease Metric | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | | :----------------------------------- | :------------------------------ | :------------------------------- | | Right-of-use assets | 14,000 | 13,800 | | Lease liabilities | 14,900 | 14,600 | | Weighted average remaining life of lease term | 20.7 years | 21.2 years | | Weighted average discount rates | 3.40% | 3.34% | | Total operating lease expenses (H1) | 1,300 | 1,200 | [Note 7. Fair Value of Financial Instruments](index=28&type=section&id=Note%207.%20Fair%20Value%20of%20Financial%20Instruments) - The company categorizes financial instruments measured at fair value into Level 1 (quoted prices in active markets), Level 2 (significant other observable inputs), and Level 3 (significant unobservable inputs)[93](index=93&type=chunk)[94](index=94&type=chunk) | Financial Instrument (Recurring) | Fair Value (June 30, 2025) ($ thousands) | Level 1 ($ thousands) | Level 2 ($ thousands) | Level 3 ($ thousands) | | :----------------------------------- | :------------------------------------ | :----------------------- | :----------------------- | :----------------------- | | Securities available for sale | 2,144,831 | 0 | 2,142,396 | 2,435 | | Derivative financial assets | 2,714 | 0 | 2,714 | 0 | | Presold mortgages in process of settlement | 8,928 | 0 | 8,928 | 0 | | Derivative financial liabilities | 2,752 | 0 | 2,752 | 0 | | Financial Instrument (Nonrecurring) | Fair Value (June 30, 2025) ($ thousands) | Level 1 ($ thousands) | Level 2 ($ thousands) | Level 3 ($ thousands) | | :------------------------------------ | :------------------------------------ | :----------------------- | :----------------------- | :----------------------- | | Individually evaluated loans | 5,649 | 0 | 0 | 5,649 | - Valuation methodologies include matrix pricing for most Level 2 securities and discounted cash flow or asset approach for individually evaluated (Level 3) loans, primarily based on real estate collateral appraisals[96](index=96&type=chunk)[97](index=97&type=chunk)[100](index=100&type=chunk) [Note 8. Stock-Based Compensation](index=31&type=section&id=Note%208.%20Stock-Based%20Compensation) | Metric | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | | Stock-based compensation expense | 1,100 | 900 | | Income tax benefits | 246 | 218 | | Metric | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | | Stock-based compensation expense | 2,100 | 1,600 | | Income tax benefits | 484 | 371 | - As of June 30, 2025, the First Bancorp 2024 Equity Plan had **1,831,944 shares available for grant**, granting restricted stock to employees and unrestricted stock to non-employee directors[105](index=105&type=chunk)[106](index=106&type=chunk)[108](index=108&type=chunk) - Total unrecognized compensation expense for restricted stock awards was **$4.5 million** at June 30, 2025, with a weighted average remaining term of **2.5 years**[109](index=109&type=chunk) [Note 9. Earnings Per Share](index=32&type=section&id=Note%209.%20Earnings%20Per%20Share) | EPS Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | | Basic EPS | 0.93 | 0.70 | | Diluted EPS | 0.93 | 0.70 | | Weighted average common shares outstanding (Basic) | 41,168,260 | 40,879,684 | | Weighted average common shares outstanding (Diluted) | 41,441,393 | 41,262,091 | | EPS Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | | Basic EPS | 1.81 | 1.31 | | Diluted EPS | 1.81 | 1.31 | | Weighted average common shares outstanding (Basic) | 41,149,623 | 40,861,775 | | Weighted average common shares outstanding (Diluted) | 41,424,063 | 41,256,081 | [Note 10. Accumulated Other Comprehensive Income (Loss)](index=33&type=section&id=Note%2010.%20Accumulated%20Other%20Comprehensive%20Income%20(Loss)) | Component of AOCI | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | | :----------------------------------- | :------------------------------ | :------------------------------- | | Net unrealized loss on securities available for sale | (229,603) | (282,114) | | Net postretirement plans asset (liability) | 85 | 85 | | Total accumulated other comprehensive income (loss) | (229,518) | (282,029) | - For the six months ended June 30, 2025, net current period other comprehensive income was **$52.511 million**, a significant improvement from a loss of **($7.161) million** in the prior year period[112](index=112&type=chunk) [Note 11. Revenue from Contracts with Customers](index=34&type=section&id=Note%2011.%20Revenue%20from%20Contracts%20with%20Customers) | Noninterest Income Category | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | | Noninterest income (in-scope of ASC 606) | 9,825 | 9,580 | | Noninterest income (out-of-scope of ASC 606) | 4,516 | 5,021 | | Total noninterest income | 14,341 | 14,601 | | Noninterest Income Category | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | | Noninterest income (in-scope of ASC 606) | 19,452 | 19,187 | | Noninterest income (out-of-scope of ASC 606) | 7,791 | 8,310 | | Total noninterest income | 27,243 | 27,497 | [Note 12. Segment Reporting](index=35&type=section&id=Note%2012.%20Segment%20Reporting) - First Bancorp operates as a single operating segment focused on banking operations, including loan and deposit products and financial advice, with management assessing performance and allocating resources based on pre-tax net income[115](index=115&type=chunk)[117](index=117&type=chunk) [Note 13. Subsequent Events](index=35&type=section&id=Note%2013.%20Subsequent%20Events) - In Q3 2025, the company executed a securities loss earnback transaction, selling **$194.3 million** of AFS securities at a **$27.9 million** loss and reinvesting **$167.4 million** in AFS securities bearing **4.79%**[120](index=120&type=chunk) [Item 2 – Management's Discussion and Analysis of Consolidated Results of Operations and Financial Condition](index=35&type=section&id=Item%202%20%E2%80%93%20Management's%20Discussion%20and%20Analysis%20of%20Consolidated%20Results%20of%20Operations%20and%20Financial%20Condition) This section provides management's perspective on the company's financial performance and condition for the three and six months ended June 30, 2025, highlighting key drivers of net income, balance sheet changes, and critical accounting estimates [Overview and Highlights](index=36&type=section&id=Overview%20and%20Highlights) | Metric | Q2 2025 | Q2 2024 | Change (%) | | :----------------------------------- | :------ | :------ | :--------- | | Net income ($ millions) | $38.6 | $28.7 | 34.5% | | Diluted EPS | $0.93 | $0.70 | 32.9% | | Adjusted net income ($ millions) | $35.9 | N/A | N/A | | Adjusted diluted EPS | $0.87 | N/A | N/A | | Net interest income ($ millions) | $96.7 | $81.1 | 19.2% | | Net interest margin (NIM) | 3.32% | 2.84% | +48 bps | | Total assets ($ billions) | $12.6 | N/A | 3.8% (vs. Dec 31, 2024) | | Total loans ($ billions) | $8.2 | N/A | 1.6% (vs. Dec 31, 2024) | | Total deposits ($ billions) | $10.8 | N/A | 2.85% (vs. Dec 31, 2024) | | Nonperforming assets to total assets | 0.28% | N/A | -2 bps (vs. Dec 31, 2024) | | On-balance sheet liquidity ratio | 20.0% | N/A | +2.4% (vs. Dec 31, 2024) | - The increase in net interest income was driven by a lower cost of funds and higher yields on interest-earning assets, partly due to Federal Reserve rate cuts in late 2024 and the securities loss-earnback transaction[122](index=122&type=chunk)[125](index=125&type=chunk)[126](index=126&type=chunk)[127](index=127&type=chunk) - Capital ratios remained strong, with Common Equity Tier 1 ratio at **14.64%**, Tier 1 risk-based capital ratio at **15.45%**, and total risk-based capital ratio at **16.90%** as of June 30, 2025, all increasing from June 30, 2024[125](index=125&type=chunk) [Critical Accounting Estimates](index=38&type=section&id=Critical%20Accounting%20Estimates) - The most subjective accounting areas are the determination of the Allowance for Credit Losses (ACL) and Allowance for Unfunded Commitments, as well as business combinations, related fair value measurements, and goodwill determination[131](index=131&type=chunk) [Current Accounting Matters](index=38&type=section&id=Current%20Accounting%20Matters) - Refer to Note 1 of the consolidated financial statements for information on recently announced or adopted accounting standards[133](index=133&type=chunk) [Results of Operations](index=39&type=section&id=RESULTS%20OF%20OPERATIONS) [Net Interest Income](index=39&type=section&id=Net%20Interest%20Income) - Net interest income for Q2 2025 increased by **$15.6 million (19.2%)** to **$96.7 million**, driven by higher yields on interest-earning assets and lower cost of funds; for H1 2025, net interest income increased by **$29.2 million (18.2%)** to **$189.6 million**[136](index=136&type=chunk)[144](index=144&type=chunk) - Net Interest Margin (NIM) improved by **48 basis points** to **3.32%** in Q2 2025 (from **2.84%** in Q2 2024) and to **3.29%** in H1 2025 (from **2.81%** in H1 2024), influenced by Federal Reserve rate cuts in late 2024, increased loan yields, and the securities loss-earnback transaction[139](index=139&type=chunk)[141](index=141&type=chunk)[144](index=144&type=chunk)[145](index=145&type=chunk)[152](index=152&type=chunk) - Average interest-earning assets increased by **$216.6 million (1.9%)** in Q2 2025 YoY, with average loans and taxable securities growing by **$116.8 million** and **$105.7 million**, respectively; average loan volumes for H1 2025 were **$60.6 million** higher than H1 2024[137](index=137&type=chunk)[152](index=152&type=chunk) - The cost of interest-bearing deposits decreased by **40 basis points** in Q2 2025 YoY, primarily due to a **$3.0 million** decrease in Other time deposits and a **$2.5 million** decrease in Money market deposits; interest expense on borrowings decreased by **$1.3 million** in Q2 2025 YoY, largely due to the payoff of Federal Reserve Bank Term Funding Program borrowings[138](index=138&type=chunk)[145](index=145&type=chunk) [Provision for Credit Losses](index=44&type=section&id=Provision%20for%20Credit%20Losses) | Metric | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | | Provision for credit losses | 2,200 | 500 | | Provision for loan losses (incl. Hurricane Helene reversal) | 1,100 | 1,500 | | Provision for unfunded commitments | 1,100 | (900) | | Metric | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | | Provision for credit losses | 3,300 | 1,700 | | Provision for unfunded commitments | 900 | (1,500) | - The Q2 2025 provision for loan losses included a **$3.5 million reversal** specifically attributed to Hurricane Helene; for H1 2025, the provision for credit losses was significantly impacted by loan growth and **$4.5 million** in net charge-offs, partially offset by a **$5.5 million** reduction in the incremental provision related to Hurricane Helene[129](index=129&type=chunk)[158](index=158&type=chunk) - The incremental reserve related to Hurricane Helene added **0.10%** to the ACL as of June 30, 2025, for approximately **$703 million** of loans in the impacted path[160](index=160&type=chunk) [Noninterest Income](index=45&type=section&id=Noninterest%20Income) | Noninterest Income Category | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | | Total noninterest income | 14,341 | 14,601 | | SBA loan sale gains | 151 | 1,336 | | Other service charges and fees - other | 4,007 | 2,955 | | Noninterest Income Category | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | | Total noninterest income | 27,243 | 27,497 | | SBA loan sale gains | 203 | 2,231 | | Other income, net | 809 | 1,570 | | Other service charges and fees - other | 7,563 | 6,211 | | Securities losses, net | 0 | (1,161) | - Noninterest income for Q2 2025 decreased slightly by **$0.26 million** YoY, primarily due to a **$1.2 million** decrease in SBA loan sale gains, partially offset by a **$1.1 million** increase in other service charges; for H1 2025, noninterest income decreased by **$0.254 million** YoY, mainly from lower SBA loan sale gains and other income, partially offset by increased service charges and the absence of securities losses seen in H1 2024[162](index=162&type=chunk) [Noninterest Expenses](index=45&type=section&id=Noninterest%20Expenses) | Noninterest Expense Category | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | | Total noninterest expenses | 58,983 | 58,291 | | Total personnel expense | 35,192 | 34,512 | | Noninterest Expense Category | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | | Total noninterest expenses | 116,876 | 117,478 | | Total personnel expense | 69,948 | 68,423 | | FDIC insurance costs | 2,822 | 3,657 | | Professional fees | 2,474 | 3,215 | - Total noninterest expenses increased by **$0.7 million (1.2%)** in Q2 2025 YoY, primarily due to a **$0.7 million** increase in total personnel costs; for H1 2025, total noninterest expenses decreased by **$0.6 million** YoY, driven by **$0.8 million** lower FDIC insurance costs and **$0.7 million** lower professional fees, partially offset by a **$1.5 million** increase in personnel costs[165](index=165&type=chunk)[166](index=166&type=chunk) [Income Taxes](index=46&type=section&id=Income%20Taxes) | Metric | Three Months Ended June 30, 2025 ($ millions) | Three Months Ended June 30, 2024 ($ millions) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | | Income tax expense | $11.3 | $8.2 | | Effective tax rate | 22.6% | 22.2% | | Metric | Six Months Ended June 30, 2025 ($ millions) | Six Months Ended June 30, 2024 ($ millions) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | | Income tax expense | $21.6 | $14.7 | | Effective tax rate | 22.4% | 21.4% | [Financial Condition](index=46&type=section&id=FINANCIAL%20CONDITION) [Total Assets and Loans](index=46&type=section&id=Total%20Assets%20and%20Loans) - Total assets increased by **$460.6 million (3.8%)** to **$12.6 billion** at June 30, 2025, primarily due to higher interest-bearing cash, AFS securities, and loans[170](index=170&type=chunk) - Total loans increased by **$131.0 million (1.6%)** to **$8.2 billion** at June 30, 2025, with the loan portfolio mix remaining stable and no notable concentrations in geographies or industries, including office or hospitality categories[171](index=171&type=chunk) [Investment Securities](index=46&type=section&id=Investment%20Securities) - Total investment securities increased by **$98.2 million** to **$2.7 billion** at June 30, 2025, with the company purchasing **$137.0 million** in investment securities during H1 2025 and no sales[172](index=172&type=chunk) - The unrealized loss on AFS securities totaled **$298.9 million** at June 30, 2025, determined to be temporary and primarily due to interest rate factors, not credit quality concerns[174](index=174&type=chunk)[175](index=175&type=chunk) [Deposits](index=48&type=section&id=Deposits) - Total deposits increased by **$299.9 million (2.8%)** to **$10.8 billion** at June 30, 2025, driven by organic growth in noninterest-bearing checking and money market accounts[175](index=175&type=chunk)[176](index=176&type=chunk) | Deposit Type | June 30, 2025 ($ thousands) | Percentage | December 31, 2024 ($ thousands) | Percentage | | :----------------------------------- | :------------------------------ | :--------- | :------------------------------- | :--------- | | Noninterest-bearing checking accounts | 3,542,626 | 33% | 3,367,624 | 32% | | Interest-bearing checking accounts | 1,443,010 | 13% | 1,398,395 | 13% | | Money market accounts | 4,446,485 | 41% | 4,285,405 | 41% | | Savings accounts | 536,247 | 5% | 542,133 | 5% | | Other time deposits | 514,865 | 5% | 566,514 | 5% | | Time deposits >$250,000 | 337,382 | 3% | 360,854 | 4% | | Total customer deposits | 10,820,615 | 100% | 10,520,925 | 100% | | Brokered deposits | 9,765 | 0% | 9,600 | 0% | | Total deposits | 10,830,380 | 100% | 10,530,525 | 100% | - As of June 30, 2025, **59.7% ($6.5 billion)** of total deposits were estimated insured, and an additional **$707.0 million** were collateralized, bringing the total insured or collateralized deposits to approximately **66.3%**[177](index=177&type=chunk) [Nonperforming Assets](index=48&type=section&id=Nonperforming%20Assets) | NPA Metric | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | | :----------------------------------- | :------------------------------ | :------------------------------- | | Total nonperforming assets | 35,843 | 36,744 | | Nonaccrual loans | 34,625 | 31,779 | | Foreclosed real estate | 1,218 | 4,965 | | Nonperforming loans to total loans | 0.42% | 0.39% | | Nonperforming assets to total assets | 0.28% | 0.30% | | Allowance for credit losses to nonperforming loans | 348.14% | 385.70% | - Total NPAs decreased to **$35.8 million** at June 30, 2025, primarily due to a **$3.7 million** decrease in foreclosed real estate, partially offset by a **$2.8 million** increase in nonaccrual loans[178](index=178&type=chunk) - Commercial and industrial loans represent the largest category of nonaccrual loans (**$10.6 million**, or **30.6%**), followed by Commercial real estate - owner occupied (**$10.0 million**, or **28.9%**); nonaccrual SBA loans totaled **$17.6 million**, with **$7.3 million** guaranteed by the SBA[179](index=179&type=chunk) [Allowance for Credit Losses, Allowance for Unfunded Commitments, and Loan Loss Experience](index=49&type=section&id=Allowance%20for%20Credit%20Losses,%20Allowance%20for%20Unfunded%20Commitments,%20and%20Loan%20Loss%20Experience) | Metric | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | | :----------------------------------- | :------------------------------ | :------------------------------- | | Allowance for credit losses (ACL) | 120,545 | 122,572 | | Net charge-offs (H1) | (4,495) | (6,032) | | Net charge-offs as a percent of average loans (annualized) | 0.11% | 0.07% | | ACL as a percent of loans | 1.47% | 1.51% | | Allowance for unfunded commitments | 9,900 | 9,100 | - The ACL decreased to **$120.5 million** at June 30, 2025, largely due to releases of **$3.5 million** (Q2) and **$5.5 million** (H1) of credit reserves related to Hurricane Helene; the ACL as a percent of loans was **1.47%**, with **10 basis points** attributable to Hurricane Helene[181](index=181&type=chunk)[182](index=182&type=chunk) - The allowance for unfunded commitments increased to **$9.9 million** at June 30, 2025, driven by an increase in available lines of credit, partially offset by a reduction in reserve rates[185](index=185&type=chunk) [Liquidity, Commitments, and Contingencies](index=50&type=section&id=Liquidity,%20Commitments,%20and%20Contingencies) - The company's on-balance sheet liquidity ratio was **20.0%** at June 30, 2025 (up from **17.6%** at Dec 31, 2024); total liquidity ratio, including **$2.3 billion** in available lines of credit, was **36.1%**[187](index=187&type=chunk) - Available borrowing capacity includes a **$1.3 billion** FHLB line of credit, **$265.0 million** in federal funds lines of credit, and an approximately **$761.1 million** Federal Reserve discount window line of credit[192](index=192&type=chunk) [Off-Balance Sheet Arrangements and Derivative Financial Instruments](index=51&type=section&id=Off-Balance%20Sheet%20Arrangements%20and%20Derivative%20Financial%20Instruments) - The company has no significant off-balance sheet arrangements other than letters of credit and repayment guarantees for trust preferred securities and subordinated debentures[189](index=189&type=chunk) - Derivative financial instruments consist entirely of customer back-to-back interest rate swaps, which are not designated as hedges, with changes in fair value recognized directly in earnings[191](index=191&type=chunk) [Capital Resources](index=52&type=section&id=Capital%20Resources) | Capital Ratio | June 30, 2025 | December 31, 2024 | Minimum Required | | :----------------------------------- | :------------ | :---------------- | :--------------- | | Common equity Tier 1 ratio | 14.64% | 14.35% | 7.00% | | Tier I capital ratio | 15.45% | 15.17% | 8.50% | | Total risk-based capital ratio | 16.90% | 16.63% | 10.50% | | Tier 1 capital to quarterly average total assets (Leverage ratio) | 11.23% | 11.15% | 4.00% | - The company was well-capitalized at June 30, 2025, with all capital ratios increasing from year-end 2024 due to retained earnings and shifts to lower risk-weighted assets[195](index=195&type=chunk) | Metric | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | | :----------------------------------- | :------------------------------ | :------------------------------- | | Tangible Common Equity (TCE) | 1,070,523 | 957,951 | | Tangible Assets | 12,122,608 | 11,660,034 | | TCE divided by Tangible Assets | 8.83% | 8.22% | [Stock Repurchase Plans](index=54&type=section&id=Stock%20Repurchase%20Plans) - The Board of Directors authorized a **$40 million** common stock repurchase plan in January 2024, renewed in January 2025; as of June 30, 2025, **$39.0 million** remained available under the program, with no repurchases made during Q2 2025[198](index=198&type=chunk)[199](index=199&type=chunk) [Item 3 – Quantitative and Qualitative Disclosures About Market Risk](index=54&type=section&id=Item%203%20%E2%80%93%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section details the company's exposure to market risk, primarily interest rate risk, and the methodologies used to monitor and manage these risks, including earnings and economic value simulation analyses [Market Risk](index=54&type=section&id=Market%20Risk) - The company's market risk primarily stems from interest rate risk inherent in lending and deposit-taking activities, with no trading assets or activities[200](index=200&type=chunk) [Interest Rate Risk](index=54&type=section&id=Interest%20Rate%20Risk) - Interest rate risk is the most significant market risk, affecting net interest income due to mismatches in asset and liability repricing characteristics, with the company aiming to maximize net interest income while minimizing adverse impacts from interest rate changes[201](index=201&type=chunk)[203](index=203&type=chunk) - Interest rate risk is monitored using earnings simulation modeling and economic value simulation (net present value estimation) to measure changes across various hypothetical interest rate scenarios[204](index=204&type=chunk) [Earnings Simulation Analysis](index=54&type=section&id=Earnings%20Simulation%20Analysis) - As of June 30, 2025, the company's net interest income sensitivity indicated an asset-sensitive position over a one-year period, with immediate parallel rate shifts resulting in a **4.7% increase** in a +200 bps scenario and a **3.9% decrease** in a -200 bps scenario[208](index=208&type=chunk) [Economic Value Simulation](index=55&type=section&id=Economic%20Value%20Simulation) - As of June 30, 2025, the company's Economic Value of Equity (EVE) generally declines in rising rate scenarios (**-3.2%** in +100 bps, **-10.5%** in +200 bps) and improves in falling rate scenarios (**+3.1%** in -100 bps, **+2.7%** in -200 bps), driven by the composition of fixed-rate loans and mortgage-backed securities versus variable-rate deposits[211](index=211&type=chunk) [Inflation](index=55&type=section&id=Inflation) - Changes in interest rates generally affect the company's financial condition more than inflation, which primarily impacts operating costs, and the company reviews pricing and costs to mitigate its effects[214](index=214&type=chunk)[215](index=215&type=chunk) [Item 4 – Controls and Procedures](index=54&type=section&id=Item%204%20%E2%80%93%20Controls%20and%20Procedures) Management, including the CEO and CFO, assessed the effectiveness of the company's disclosure controls and procedures as of June 30, 2025, concluding they were effective, with no material changes to internal control over financial reporting occurring during the period - The CEO and CFO concluded that disclosure controls and procedures were effective as of June 30, 2025, ensuring timely disclosure decisions for material information[216](index=216&type=chunk) - No material changes to internal control over financial reporting occurred during or subsequent to the period covered by the report[216](index=216&type=chunk) Part II. Other Information [Item 1 – Legal Proceedings](index=54&type=section&id=Item%201%20%E2%80%93%20Legal%20Proceedings) The company is not involved in any pending legal proceedings that management believes are material to its consolidated financial position, with reserves established for probable and determinable losses - No material legal proceedings are pending or threatened against the company or its subsidiaries[217](index=217&type=chunk) [Item 1A – Risk Factors](index=54&type=section&id=Item%201A%20%E2%80%93%20Risk%20Factors) There are no material changes to the risk factors previously disclosed in the company's 2024 Annual Report on Form 10-K - No material changes to the risk factors from the 2024 Annual Report on Form 10-K[218](index=218&type=chunk) [Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds](index=56&type=section&id=Item%202%20%E2%80%93%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section refers to the Stock Repurchase Plans discussed in Management's Discussion and Analysis - Information regarding issuer purchases of equity securities is incorporated by reference from the Stock Repurchase Plans section of Management's Discussion and Analysis[219](index=219&type=chunk) [Item 5 - Other Information](index=56&type=section&id=Item%205%20-%20Other%20Information) No Section 16 reporting persons (directors and certain officers) maintained, adopted, modified, or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1(c) arrangement during the quarter ended June 30, 2025 - No Section 16 reporting persons engaged in Rule 10b5-1 trading arrangements or non-Rule 10b5-1(c) arrangements during Q2 2025[220](index=220&type=chunk)[221](index=221&type=chunk) [Item 6 – Exhibits](index=55&type=section&id=Item%206%20%E2%80%93%20Exhibits) This section lists all exhibits filed with the report, including articles of incorporation, bylaws, stock certificates, officer certifications, and XBRL financial information - Exhibits include Articles of Incorporation, Amended and Restated Bylaws, Form of Common Stock Certificate, CEO and CFO certifications (Sections 302(a) and 906 of Sarbanes-Oxley Act), and XBRL financial information[224](index=224&type=chunk)

Group 1 - First Bancorp has a market capitalization of $1.98 billion, indicating it is a decent-sized bank [1] - The focus of Crude Value Insights is on cash flow and companies that generate it, highlighting value and growth prospects in the oil and natural gas sector [1] Group 2 - Subscribers of Crude Value Insights have access to a 50+ stock model account and in-depth cash flow analyses of exploration and production firms [2] - The service includes live chat discussions about the oil and gas sector, enhancing community engagement [2]

Core Insights - First Bancorp (FBNC) reported revenue of $111.02 million for the quarter ended June 2025, marking a year-over-year increase of 16% and exceeding the Zacks Consensus Estimate of $108.33 million by 2.48% [1] - The company's EPS for the same period was $0.93, up from $0.70 a year ago, and also surpassed the consensus EPS estimate of $0.88 by 5.68% [1] Financial Performance Metrics - Net Interest Margin was reported at 3.3%, higher than the estimated 2.9% by analysts [4] - Net Charge-offs remained stable at 0.1%, matching the average estimate [4] - Average Interest-Earning Assets totaled $11.68 billion, slightly below the average estimate of $11.7 billion [4] - Total Non-Interest Income was $14.34 million, exceeding the average estimate of $13.94 million [4] - Bank-Owned Life Insurance Income was $1.22 million, above the estimated $1.12 million [4] - Other service charges, commissions, and fees reached $6.6 million, surpassing the average estimate of $5.86 million [4] - Commissions from sales of insurance and financial products were $1.39 million, exceeding the estimated $1.15 million [4] - Service charges on deposit accounts were $3.98 million, slightly below the average estimate of $4.18 million [4] - Net Interest Income was reported at $96.68 million, above the average estimate of $93.78 million [4] - Fees from presold mortgage loans were $0.32 million, lower than the average estimate of $0.84 million [4] Stock Performance - Shares of First Bancorp have returned +11.2% over the past month, outperforming the Zacks S&P 500 composite's +5.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Financial Performance - First Bancorp reported quarterly earnings of $0.93 per share, exceeding the Zacks Consensus Estimate of $0.88 per share, and up from $0.70 per share a year ago, representing an earnings surprise of +5.68% [1] - The company posted revenues of $111.02 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 2.48%, compared to year-ago revenues of $95.72 million [2] - Over the last four quarters, First Bancorp has surpassed consensus EPS estimates four times and topped consensus revenue estimates three times [2] Stock Performance and Outlook - First Bancorp shares have increased approximately 6.6% since the beginning of the year, while the S&P 500 has gained 7.3% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the coming quarter is $0.91 on revenues of $110.83 million, and $3.50 on revenues of $436.57 million for the current fiscal year [7] Industry Context - The Zacks Industry Rank indicates that the Banks - Southeast industry is currently in the top 14% of over 250 Zacks industries, suggesting a favorable environment for stock performance [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Executive Summary & Q2 2025 Highlights [Q2 2025 Financial Data](index=1&type=section&id=Q2%202025%20Financial%20Data) First Bancorp reported strong second-quarter 2025 results with significant increases in net income and diluted EPS compared to both the linked and like quarters, achieving expanded net interest income and margin, alongside disciplined expense management and improved liquidity and capital levels Q2 2025 Financial Data | Metric | Q2-2025 | Q1-2025 | Q2-2024 | | :--- | :--- | :--- | :--- | | Total interest income | $136,741 | $132,660 | $128,822 | | Total interest expense | $40,065 | $39,777 | $47,707 | | Net interest income | $96,676 | $92,883 | $81,115 | | Provision for credit losses | $2,212 | $1,116 | $541 | | Noninterest income | $14,341 | $12,902 | $14,601 | | Noninterest expenses | $58,983 | $57,893 | $58,291 | | Income tax expense | $11,256 | $10,370 | $8,172 | | Net income | $38,566 | $36,406 | $28,712 | | Diluted EPS | $0.93 | $0.88 | $0.70 | | Return on average assets | 1.24% | 1.21% | 0.96% | | Return on average common equity | 10.11% | 10.06% | 8.38% | | NIM | 3.32% | 3.25% | 2.84% | | Tangible common equity to tangible assets | 8.83% | 8.55% | 7.90% | | Common equity tier I capital ratio | 14.62% | 14.52% | 13.99% | | Total risk-based capital ratio | 16.87% | 16.80% | 16.24% | [Q2 2025 Key Highlights](index=1&type=section&id=Q2%202025%20Key%20Highlights) Key highlights for Q2 2025 include significant diluted EPS growth, expanded loan yield, contracted cost of funds, increased core deposits, strong loan growth, and improved liquidity - Diluted earnings per share (D-EPS) increased to **$0.93**, up from $0.88 in Q1-2025 and $0.70 in Q2-2024[2](index=2&type=chunk)[3](index=3&type=chunk) - Total loan yield expanded to **5.53%** (up 1 bp QoQ, 3 bps YoY), while total cost of funds contracted **3 bps to 1.48%** (from 1.51% QoQ and 1.81% YoY)[2](index=2&type=chunk)[3](index=3&type=chunk) - Average core deposits reached **$10.7 billion**, an increase of **$140.4 million** from the linked quarter, driven by growth in noninterest-bearing deposits and money market accounts[3](index=3&type=chunk) - Total loans grew by **$122.6 million** (**6.07% annualized**) for the quarter, reaching **$8.2 billion** at June 30, 2025[3](index=3&type=chunk) - On-balance sheet liquidity ratio increased to **20.0%** from 19.8% in the linked quarter, with total liquidity ratio at **36.1%** including off-balance sheet sources[3](index=3&type=chunk) [CEO Statement](index=2&type=section&id=CEO%20Statement) CEO Richard H. Moore highlighted improved financial results, expanded net interest margin, disciplined expense management, enhanced liquidity, increased capital, strong credit quality, and an approved dividend increase - Second quarter net income was **$38.6 million** and diluted EPS was **$0.93**, driven by expanded net interest margin and disciplined expense management[7](index=7&type=chunk) - The company improved its liquidity position and increased capital levels, while maintaining strong credit quality with low charge-offs and nonperforming assets[7](index=7&type=chunk) - Loan growth was **6% annualized** in the quarter, benefiting from favorable cost of funds and increased yields on earning assets[7](index=7&type=chunk) - The Board increased the quarterly dividend to **$0.23 per share**, effective June 30, 2025[7](index=7&type=chunk) Financial Performance Analysis [Net Interest Income and Net Interest Margin](index=2&type=section&id=Net%20Interest%20Income%20and%20Net%20Interest%20Margin) Net interest income and net interest margin (NIM) significantly improved in Q2 2025, primarily due to effective management of deposit costs, increased loan yields, and higher securities yields - Net interest income for Q2 2025 was **$96.7 million**, a **4.1% increase** from the linked quarter ($92.9 million) and a **19.2% increase** from the like quarter ($81.1 million)[8](index=8&type=chunk) - NIM expanded to **3.32%** in Q2 2025, up **7 basis points** from 3.25% in the linked quarter and **48 basis points** from 2.84% in the like quarter[9](index=9&type=chunk) - The yield on securities increased by **13 basis points to 2.41%** due to the purchase of **$127.0 million** of CMOs yielding **5.16%**. Loan yields also increased by **1 basis point to 5.53%**[9](index=9&type=chunk) Yield Information (Quarterly) | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Yield on loans | 5.53% | 5.52% | 5.50% | | Yield on securities | 2.41% | 2.28% | 1.72% | | Cost of interest-bearing deposits | 2.14% | 2.14% | 2.54% | | Total cost of funds | 1.48% | 1.51% | 1.81% | | Net interest margin | 3.32% | 3.25% | 2.84% | [Provision for Credit Losses and Credit Quality](index=3&type=section&id=Provision%20for%20Credit%20Losses%20and%20Credit%20Quality) The provision for credit losses increased in Q2 2025 due to net charge-offs, loan growth, and macroeconomic projections, while asset quality remained strong - Provision for credit losses was **$2.2 million** in Q2 2025, up from $1.1 million in Q1 2025 and $0.5 million in Q2 2024[13](index=13&type=chunk) - The Q2 2025 provision was influenced by **$1.2 million** in net charge-offs, reserves for **$122.6 million** in loan growth, and declining macro-economic projections, partially offset by a **$3.5 million** reduction in Hurricane Helene reserves[13](index=13&type=chunk) - Asset quality remained strong with annualized net loan charge-offs of **0.06%** for Q2 2025. Total nonperforming assets (NPAs) were **$35.8 million**, or **0.28% of total assets**, consistent with prior periods[15](index=15&type=chunk) Asset Quality Data | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Nonaccrual loans | $34,625 | $29,081 | $33,102 | | Total nonperforming assets | $35,843 | $33,850 | $34,252 | | Quarterly net charge-offs to average loans - annualized | 0.06% | 0.17% | 0.07% | | Nonperforming loans to total loans | 0.42% | 0.36% | 0.54% | | Nonperforming assets to total assets | 0.28% | 0.27% | 0.28% | | Allowance for credit losses to total loans | 1.47% | 1.49% | 1.36% | [Noninterest Income](index=4&type=section&id=Noninterest%20Income) Total noninterest income increased from the linked quarter, primarily driven by higher service charges and other income, but slightly decreased year-over-year - Total noninterest income was **$14.3 million** in Q2 2025, an **11.2% increase** from $12.9 million in the linked quarter, but a **1.8% decrease** from $14.6 million in the like quarter[18](index=18&type=chunk) - The increase from the linked quarter was mainly due to higher Other service charges, commissions and fees (up **$0.7 million**) and Other income, net (up **$0.6 million**)[18](index=18&type=chunk) [Noninterest Expenses](index=4&type=section&id=Noninterest%20Expenses) Noninterest expenses saw a modest increase from both the linked and like quarters, primarily due to higher operating and personnel expenses - Noninterest expenses totaled **$59.0 million** in Q2 2025, a **$1.1 million (1.9%) increase** from $57.9 million in the linked quarter[19](index=19&type=chunk) - The linked quarter increase was driven by a **$0.7 million** rise in Other operating expenses and a **$0.4 million** increase in total personnel expenses[19](index=19&type=chunk) - Compared to the like quarter, noninterest expenses increased by **$0.7 million**, mainly due to higher total personnel expenses and occupancy/equipment costs[20](index=20&type=chunk) [Income Taxes](index=4&type=section&id=Income%20Taxes) Income tax expense increased in Q2 2025, with a slightly higher effective tax rate compared to prior periods - Income tax expense was **$11.3 million** in Q2 2025, up from $10.4 million in the linked quarter and $8.2 million in the like quarter[21](index=21&type=chunk) - Effective tax rates were **22.6%** for Q2 2025, compared to 22.2% for both the linked and like quarters[21](index=21&type=chunk) Balance Sheet Overview [Assets](index=5&type=section&id=Assets) Total assets grew in Q2 2025, primarily driven by loan growth and an increase in the available-for-sale securities portfolio, which also saw decreased unrealized losses - Total assets reached **$12.6 billion** at June 30, 2025, an increase of **$172.0 million (5.5% annualized)** from the linked quarter and **$547.5 million (4.5%)** from a year earlier[22](index=22&type=chunk) - Investment securities increased to **$2.7 billion**, reflecting **$78.5 million** increase from the linked quarter, due to purchases and decreased unrealized losses on available-for-sale securities[24](index=24&type=chunk) - Total unrealized losses on available for sale investment securities decreased to **$298.9 million** at June 30, 2025, from $321.2 million at March 31, 2025 and $410.1 million at June 30, 2024[24](index=24&type=chunk) Key Period End Balance Sheet Components | BALANCES ($ in thousands) | June 30, 2025 | March 31, 2025 | June 30, 2024 | Change 2Q25 vs 1Q25 | Change 2Q25 vs 2Q24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total assets | $12,608,265 | $12,436,245 | $12,060,805 | 1.4% | 4.5% | | Loans | $8,225,650 | $8,103,033 | $8,069,848 | 1.5% | 1.9% | | Investment securities | $2,661,236 | $2,582,781 | $2,390,811 | 3.0% | 11.3% | | Total cash and cash equivalents | $711,286 | $772,441 | $608,412 | (7.9)% | 16.9% | | Noninterest-bearing deposits | $3,542,626 | $3,476,786 | $3,339,678 | 1.9% | 6.1% | | Interest-bearing deposits | $7,287,754 | $7,267,873 | $7,148,151 | 0.3% | 2.0% | | Shareholders' equity | $1,556,180 | $1,508,176 | $1,404,342 | 3.2% | 10.8% | [Loans Portfolio](index=5&type=section&id=Loans%20Portfolio) Total loans continued to grow, with a diversified portfolio mix and no notable concentrations in specific geographies or industries, including non-owner occupied office loans - Total loans amounted to **$8.2 billion** at June 30, 2025, an increase of **$122.6 million (6.1% annualized)** from March 31, 2025, and **$155.8 million (1.9%)** from June 30, 2024[25](index=25&type=chunk) - The loan portfolio is diversified, with no notable concentrations in North Carolina and South Carolina geographies or industries like office or hospitality[25](index=25&type=chunk) - Non-owner occupied office loans represented approximately **6.5% of the total portfolio**, primarily in non-metro markets, with the ten largest loans in this category being less than **2% of the total loan portfolio**[25](index=25&type=chunk) Loan Portfolio by Category | LOAN PORTFOLIO ($ in thousands) | June 30, 2025 Amount | June 30, 2025 Percentage | March 31, 2025 Amount | March 31, 2025 Percentage | June 30, 2024 Amount | June 30, 2024 Percentage | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Commercial and industrial | $911,227 | 11% | $890,071 | 11% | $863,366 | 11% | | Construction, development & other land loans | $633,529 | 8% | $644,439 | 8% | $764,418 | 9% | | Commercial real estate - owner occupied | $1,254,596 | 15% | $1,233,732 | 15% | $1,250,267 | 16% | | Commercial real estate - non owner occupied | $2,758,629 | 34% | $2,701,746 | 34% | $2,561,803 | 32% | | Multi-family real estate | $509,419 | 6% | $512,958 | 6% | $497,187 | 6% | | Residential 1-4 family real estate | $1,731,397 | 21% | $1,709,593 | 21% | $1,729,050 | 21% | | Home equity loans/lines of credit | $355,876 | 4% | $341,240 | 4% | $326,411 | 4% | | Consumer loans | $70,137 | 1% | $68,115 | 1% | $76,638 | 1% | | Loans, gross | $8,224,810 | 100% | $8,101,894 | 100% | $8,069,140 | 100% | [Deposits Portfolio](index=6&type=section&id=Deposits%20Portfolio) Total deposits increased, maintaining a diversified and stable funding base with a significant portion of noninterest-bearing deposits, and a high percentage insured or collateralized - Total deposits were **$10.8 billion** at June 30, 2025, an increase of **$85.7 million (3.2% annualized)** from March 31, 2025, and **$342.6 million (3.3%)** from June 30, 2024[28](index=28&type=chunk) - Noninterest-bearing deposits comprised **33% of total deposits** at June 30, 2025, indicating a stable funding source[29](index=29&type=chunk) - Approximately **66.3% of total deposits** were insured or collateralized at June 30, 2025[30](index=30&type=chunk) Deposit Portfolio by Category | DEPOSIT PORTFOLIO ($ in thousands) | June 30, 2025 Amount | June 30, 2025 Percentage | March 31, 2025 Amount | March 31, 2025 Percentage | June 30, 2024 Amount | June 30, 2024 Percentage | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Noninterest-bearing checking accounts | $3,542,626 | 33% | $3,476,786 | 32% | $3,339,678 | 32% | | Interest-bearing checking accounts | $1,443,010 | 13% | $1,448,377 | 14% | $1,400,071 | 13% | | Money market accounts | $4,446,485 | 41% | $4,386,469 | 41% | $4,150,429 | 40% | | Savings accounts | $536,247 | 5% | $539,632 | 5% | $558,126 | 5% | | Other time deposits | $514,865 | 5% | $533,723 | 5% | $601,212 | 6% | | Time deposits >$250,000 | $337,382 | 3% | $349,990 | 3% | $389,281 | 4% | | Total customer deposits | $10,820,615 | 100% | $10,734,977 | 100% | $10,438,797 | 100% | | Brokered deposits | $9,765 | —% | $9,682 | —% | $49,032 | —% | | Total deposits | $10,830,380 | 100% | $10,744,659 | 100% | $10,487,829 | 100% | Capital and Liquidity [Capital Ratios](index=6&type=section&id=Capital%20Ratios) First Bancorp maintained capital levels well above regulatory requirements, with all key capital ratios showing improvement from both the linked and like quarters - The estimated total risk-based capital ratio at June 30, 2025, was **16.87%**, up from 16.80% in the linked quarter and 16.24% in the like quarter[31](index=31&type=chunk) - The tangible common equity (TCE) to tangible assets ratio (non-GAAP) increased to **8.83%** at June 30, 2025, up **28 basis points** from the linked quarter and **93 basis points** from June 30, 2024[32](index=32&type=chunk) - The increase in capital ratios was primarily driven by earnings exceeding dividends and improvements in unrealized losses on the available-for-sale securities portfolio[31](index=31&type=chunk)[32](index=32&type=chunk) Capital Ratios (Estimated) | CAPITAL RATIOS | June 30, 2025 (estimated) | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Tangible common equity to tangible assets (non-GAAP) | 8.83% | 8.55% | 7.90% | | Common equity tier I capital ratio | 14.62% | 14.52% | 13.99% | | Tier I leverage ratio | 11.45% | 11.41% | 11.24% | | Tier I risk-based capital ratio | 15.42% | 15.34% | 14.79% | | Total risk-based capital ratio | 16.87% | 16.80% | 16.24% | [Liquidity Position](index=7&type=section&id=Liquidity%20Position) The company maintained a strong liquidity position, with both on-balance sheet and off-balance sheet sources deemed adequate to meet operational needs - The on-balance sheet liquidity ratio was **20.0%** at June 30, 2025, an increase from 19.8% in the linked quarter[35](index=35&type=chunk) - Available off-balance sheet sources totaled approximately **$2.3 billion**, resulting in a total liquidity ratio of **36.1%**[35](index=35&type=chunk) Company Information [About First Bancorp](index=8&type=section&id=About%20First%20Bancorp) First Bancorp is a bank holding company operating First Bank, a community bank with 113 branches in North and South Carolina, offering tailored banking solutions and SBA loans - First Bancorp is headquartered in Southern Pines, North Carolina, with total assets of **$12.6 billion**[37](index=37&type=chunk) - Its principal activity is the ownership and operation of First Bank, a state-chartered community bank with **113 branches** in North Carolina and South Carolina[37](index=37&type=chunk) - First Bank provides tailored banking solutions, local expertise, technology, and SBA loans through a nationwide network[37](index=37&type=chunk) [Forward-Looking Statements](index=8&type=section&id=Forward-Looking%20Statements) The press release contains forward-looking statements subject to risks and uncertainties, and the company disclaims any obligation to update or revise them - Statements in the press release that are not historical facts are forward-looking and subject to risks and uncertainties, including financial success of customers, integration of acquisitions, regulatory actions, interest rates, and economic conditions[39](index=39&type=chunk) - The company undertakes no obligation to update or revise forward-looking statements and is not responsible for changes made by media[39](index=39&type=chunk) [Non-GAAP Measures Disclosure](index=8&type=section&id=Non-GAAP%20Measures%20Disclosure) The company uses non-GAAP financial measures to evaluate performance, which are not substitutes for GAAP measures and are reconciled in the appendices - Certain performance measures presented are non-GAAP and used by management to evaluate performance, excluding or including amounts not normally treated as such under GAAP[40](index=40&type=chunk) - Non-GAAP measures should not be viewed as substitutes for GAAP measures, and reconciliations are provided in the appendices[40](index=40&type=chunk) Detailed Financial Statements [Consolidated Income Statement](index=9&type=section&id=Consolidated%20Income%20Statement) The consolidated income statement shows strong growth in net interest income and net income for both the quarter and year-to-date periods, despite increased provision for credit losses and noninterest expenses Consolidated Income Statement (Q2 2025 vs. Q1 2025 vs. Q2 2024) | ($ in thousands, except per share data) | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Total interest income | $136,741 | $132,660 | $128,822 | | Total interest expense | $40,065 | $39,777 | $47,707 | | Net interest income | $96,676 | $92,883 | $81,115 | | Provision for credit losses | $2,212 | $1,116 | $541 | | Total noninterest income | $14,341 | $12,902 | $14,601 | | Total noninterest expenses | $58,983 | $57,893 | $58,291 | | Income before income taxes | $49,822 | $46,776 | $36,884 | | Income tax expense | $11,256 | $10,370 | $8,172 | | Net income | $38,566 | $36,406 | $28,712 | | Diluted EPS | $0.93 | $0.88 | $0.70 | Consolidated Income Statement (YTD June 30, 2025 vs. YTD June 30, 2024) | ($ in thousands, except per share data) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total interest income | $269,401 | $255,436 | | Total interest expense | $79,842 | $95,047 | | Net interest income | $189,559 | $160,389 | | Provision for credit losses | $3,328 | $1,741 | | Total noninterest income | $27,243 | $27,497 | | Total noninterest expenses | $116,876 | $117,478 | | Income before income taxes | $96,598 | $68,667 | | Income tax expense | $21,626 | $14,683 | | Net income | $74,972 | $53,984 | | Diluted EPS | $1.81 | $1.31 | [Consolidated Balance Sheets](index=10&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheet reflects growth in total assets, loans, and deposits, alongside an increase in shareholders' equity and a reduction in accumulated other comprehensive loss Consolidated Balance Sheets ($ in thousands) | Assets | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Total cash and cash equivalents | $711,286 | $772,441 | $608,412 | | Securities available for sale | $2,144,831 | $2,064,516 | $1,867,211 | | Securities held to maturity | $516,405 | $518,265 | $523,600 | | Loans | $8,225,650 | $8,103,033 | $8,069,848 | | Allowance for credit losses on loans | $(120,545) | $(120,631) | $(110,058) | | Net loans | $8,105,105 | $7,982,402 | $7,959,790 | | Total assets | $12,608,265 | $12,436,245 | $12,060,805 | | Liabilities | | | | | Total deposits | $10,830,380 | $10,744,659 | $10,487,829 | | Borrowings | $92,237 | $92,055 | $91,513 | | Total liabilities | $11,052,085 | $10,928,069 | $10,656,463 | | Shareholders' equity | | | | | Total shareholders' equity | $1,556,180 | $1,508,176 | $1,404,342 | | Accumulated other comprehensive loss | $(229,518) | $(246,628) | $(315,191) | | Total liabilities and shareholders' equity | $12,608,265 | $12,436,245 | $12,060,805 | [Trend Information](index=11&type=section&id=Trend%20Information) Performance ratios, common share data, and capital information show positive trends across key metrics over the past five quarters, with improvements in profitability, book value, and capital strength Performance Ratios (Annualized) | Metric | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Return on average assets | 1.24% | 1.21% | 0.12% | 0.61% | 0.96% | | Return on average common equity | 10.11% | 10.06% | 0.96% | 5.14% | 8.38% | | Return on average tangible common equity | 15.25% | 15.54% | 1.93% | 8.30% | 13.60% | Common Share Data | Metric | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Cash dividends declared - common | $0.23 | $0.22 | $0.22 | $0.22 | $0.22 | | Book value per common share | $37.53 | $36.46 | $34.96 | $35.74 | $34.10 | | Tangible book value per share | $25.82 | $24.69 | $23.17 | $23.91 | $22.19 | | Common shares outstanding at end of period | 41,468,098 | 41,368,828 | 41,347,418 | 41,340,099 | 41,187,943 | Capital Information (Preliminary for Current Quarter) | Metric | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Tangible common equity to tangible assets | 8.83% | 8.55% | 8.22% | 8.47% | 7.90% | | Common equity tier I capital ratio | 14.62% | 14.52% | 14.35% | 14.37% | 13.99% | | Total risk-based capital ratio | 16.87% | 16.80% | 16.63% | 16.65% | 16.24% | [Average Balances and Net Interest Income Analysis - Quarters](index=12&type=section&id=Average%20Balances%20and%20Net%20Interest%20Income%20Analysis%20-%20Quarters) Quarterly average balance analysis shows consistent growth in interest-earning assets and net interest income, with an expanding net interest margin, driven by higher asset yields and managed liability costs Average Balances and Net Interest Income Analysis (Quarterly) | ($ in thousands) | June 30, 2025 Average Volume | June 30, 2025 Interest Earned or Paid | June 30, 2025 Average Rate | March 31, 2025 Average Volume | March 31, 2025 Interest Earned or Paid | March 31, 2025 Average Rate | June 30, 2024 Average Volume | June 30, 2024 Interest Earned or Paid | June 30, 2024 Average Rate | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Loans | $8,187,662 | $112,931 | 5.53% | $8,107,394 | $110,533 | 5.52% | $8,070,815 | $110,472 | 5.50% | | Total interest-earning assets | $11,678,760 | $136,741 | 4.69% | $11,528,742 | $132,660 | 4.65% | $11,462,112 | $128,822 | 4.51% | | Total interest-bearing deposits | $7,212,437 | $38,405 | 2.14% | $7,219,042 | $38,119 | 2.14% | $7,081,586 | $44,744 | 2.54% | | Total interest-bearing liabilities | $7,304,636 | $40,065 | 2.20% | $7,311,002 | $39,777 | 2.21% | $7,249,562 | $47,707 | 2.65% | | Net interest income | | $96,676 | 3.32% | | $92,883 | 3.25% | | $81,115 | 2.84% | | Interest rate spread | | | 2.49% | | | 2.44% | | | 1.86% | [Average Balances and Net Interest Income Analysis - Year-to-Date](index=13&type=section&id=Average%20Balances%20and%20Net%20Interest%20Income%20Analysis%20-%20Year-to-Date) Year-to-date average balance analysis demonstrates sustained growth in interest-earning assets and net interest income, with a notable expansion in net interest margin and interest rate spread compared to the prior year Average Balances and Net Interest Income Analysis (Year-to-Date) | ($ in thousands) | June 30, 2025 Average Volume | June 30, 2025 Interest Earned or Paid | June 30, 2025 Average Rate | June 30, 2024 Average Volume | June 30, 2024 Interest Earned or Paid | June 30, 2024 Average Rate | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Loans | $8,147,750 | $223,464 | 5.52% | $8,087,101 | $220,270 | 5.47% | | Total interest-earning assets | $11,604,165 | $269,401 | 4.67% | $11,475,954 | $255,436 | 4.47% | | Total interest-bearing deposits | $7,215,721 | $76,524 | 2.14% | $6,923,761 | $83,879 | 2.44% | | Total interest-bearing liabilities | $7,307,802 | $79,842 | 2.20% | $7,296,748 | $95,047 | 2.62% | | Net interest income | | $189,559 | 3.29% | | $160,389 | 2.81% | | Interest rate spread | | | 2.47% | | | 1.85% | Non-GAAP Reconciliations (Appendices) [APPENDIX A: Calculation of Return on TCE](index=14&type=section&id=APPENDIX%20A%3A%20Calculation%20of%20Return%20on%20TCE) This appendix provides the reconciliation for the calculation of Return on Tangible Common Equity (TCE), a non-GAAP measure, showing its components and trend over the past five quarters Calculation of Return on TCE ($ in thousands) | Metric | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Net Income | $38,566 | $36,406 | $3,551 | $18,680 | $28,712 | | Intangible asset amortization, net of taxes | $1,123 | $1,159 | $1,195 | $1,240 | $1,283 | | Tangible Net income | $39,689 | $37,565 | $4,746 | $19,920 | $29,995 | | Average common equity | $1,530,550 | $1,467,871 | $1,466,181 | $1,445,029 | $1,378,284 | | Less: Average goodwill and other intangibles, net of related taxes | $(486,393) | $(487,395) | $(488,624) | $(489,987) | $(491,318) | | Average tangible common equity | $1,044,157 | $980,476 | $977,557 | $955,042 | $886,966 | | Return on average common equity | 10.11% | 10.06% | 0.96% | 5.14% | 8.38% | | Return on average tangible common equity | 15.25% | 15.54% | 1.93% | 8.30% | 13.60% | [APPENDIX B: Reconciliation of Common Equity to TCE](index=14&type=section&id=APPENDIX%20B%3A%20Reconciliation%20of%20Common%20Equity%20to%20TCE) This appendix details the reconciliation from total shareholders' common equity to tangible common equity (TCE) by subtracting goodwill and other intangibles, net of related taxes Reconciliation of Common Equity to TCE ($ in thousands) | Metric | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total shareholders' common equity | $1,556,180 | $1,508,176 | $1,445,611 | $1,477,525 | $1,404,342 | | Less: Goodwill and other intangibles, net of related taxes | $(485,657) | $(486,749) | $(487,660) | $(489,139) | $(490,439) | | Tangible common equity | $1,070,523 | $1,021,427 | $957,951 | $988,386 | $913,903 | [APPENDIX C: Tangible Book Value Per Share](index=14&type=section&id=APPENDIX%20C%3A%20Tangible%20Book%20Value%20Per%20Share) This appendix presents the calculation of tangible book value per common share, a non-GAAP measure, by dividing tangible common equity by common shares outstanding Tangible Book Value Per Share ($ in thousands except per share data) | Metric | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Tangible common equity (Appendix B) | $1,070,523 | $1,021,427 | $957,951 | $988,386 | $913,903 | | Common shares outstanding | 41,468,098 | 41,368,828 | 41,347,418 | 41,340,099 | 41,187,943 | | Tangible book value per common share | $25.82 | $24.69 | $23.17 | $23.91 | $22.19 | [APPENDIX D: TCE Ratio](index=14&type=section&id=APPENDIX%20D%3A%20TCE%20Ratio) This appendix provides the calculation of the Tangible Common Equity (TCE) to Tangible Assets (TA) ratio, a non-GAAP measure, showing the company's capital strength relative to its tangible asset base TCE Ratio ($ in thousands) | Metric | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Tangible common equity (Appendix B) | $1,070,523 | $1,021,427 | $957,951 | $988,386 | $913,903 | | Total assets | $12,608,265 | $12,436,245 | $12,147,694 | $12,153,430 | $12,060,805 | | Less: Goodwill and other intangibles, net of related taxes | $(485,657) | $(486,749) | $(487,660) | $(489,139) | $(490,439) | | Tangible assets ("TA") | $12,122,608 | $11,949,496 | $11,660,034 | $11,664,291 | $11,570,366 | | TCE to TA ratio | 8.83% | 8.55% | 8.22% | 8.47% | 7.90% | [APPENDIX E: Adjusted D-EPS](index=15&type=section&id=APPENDIX%20E%3A%20Adjusted%20D-EPS) This appendix provides the reconciliation of diluted earnings per share (D-EPS) to adjusted D-EPS, a non-GAAP measure, by accounting for the after-tax impact of Hurricane Helene Adjusted D-EPS ($ in thousands) | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Net income | $38,566 | $36,406 | $28,712 | | Impact of Hurricane Helene: Provision for (benefit from) credit losses | $(3,500) | $(2,000) | — | | Less, tax impact | $812 | $464 | — | | After-tax impact of Hurricane Helene | $(2,688) | $(1,536) | — | | Adjusted net income | $35,878 | $34,870 | $28,712 | | Weighted average shares outstanding - diluted | 41,441,393 | 41,406,525 | 41,262,091 | | D-EPS | $0.93 | $0.88 | $0.70 | | Adjusted D-EPS | $0.87 | $0.84 | $0.70 | [APPENDIX F: Loan purchase discount accretion and its impact on the Company's NIM](index=16&type=section&id=APPENDIX%20F%3A%20Loan%20purchase%20discount%20accretion%20and%20its%20impact%20on%20the%20Company's%20NIM) This appendix details the impact of loan purchase accounting discount accretion on net interest income and net interest margin (NIM), showing a decreasing but still positive contribution - Loan purchase accounting discount accretion included in interest income was **$1.5 million** in Q2 2025, compared to $1.8 million in the linked quarter and $2.3 million in the like quarter[62](index=62&type=chunk) - This accretion had positive impacts of **4 basis points**, **5 basis points**, and **6 basis points** on the company's NIM and NIM-T/E in Q2 2025, the linked quarter, and the like quarter, respectively[62](index=62&type=chunk) Net Interest Income Purchase Accounting Adjustments ($ in thousands) | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Interest income - increased by accretion of loan discount on acquired loans | $1,457 | $1,789 | $2,303 | | Total interest income impact | $1,457 | $1,789 | $2,303 | | Interest expense - increased by discount accretion on deposits | $(102) | $(103) | $(224) | | Interest expense - increased by discount accretion on borrowings | $(194) | $(191) | $(190) | | Total net interest expense impact | $(296) | $(294) | $(414) | | Total impact on net interest income | $1,161 | $1,495 | $1,889 |

Company Overview - First Bancorp (FBNC) is expected to report a year-over-year increase in earnings, with a projected EPS of $0.88, reflecting a +25.7% change, and revenues of $108.33 million, up 13.2% from the previous year [3][12] Earnings Expectations - The earnings report is anticipated to influence the stock price significantly, with potential upward movement if results exceed expectations, while a miss could lead to a decline [2][15] - The consensus EPS estimate has been revised 0.73% lower in the last 30 days, indicating a reassessment by analysts [4][12] Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that the Most Accurate Estimate for First Bancorp is lower than the consensus estimate, resulting in an Earnings ESP of -0.38%, suggesting a bearish outlook [12] - Despite the negative Earnings ESP, the stock holds a Zacks Rank of 3, making it challenging to predict an earnings beat conclusively [12][17] Historical Performance - First Bancorp has a history of beating consensus EPS estimates, having surpassed expectations in the last four quarters, including a +7.69% surprise in the most recent quarter [13][14] Industry Comparison - Veritex Holdings (VBTX), another player in the Southeast banking industry, is expected to report an EPS of $0.55, reflecting a +5.8% year-over-year change, with revenues projected at $109.9 million, up 2.9% [18][19] - Veritex Holdings has a positive Earnings ESP of +1.21% and a Zacks Rank of 3, indicating a likelihood of beating the consensus EPS estimate [19][20]

Company Overview - First Bancorp (FBNC) is headquartered in Southern Pines and operates in the Finance sector [3] - The stock has experienced a price change of 0.27% since the beginning of the year [3] Dividend Information - First Bancorp currently pays a dividend of $0.22 per share, resulting in a dividend yield of 2.09% [3] - The average dividend yield for the Banks - Southeast industry is 2.37%, while the S&P 500's yield is 1.57% [3] - The company's annualized dividend of $0.92 has increased by 4.5% from the previous year [4] - Over the last 5 years, First Bancorp has increased its dividend 2 times year-over-year, with an average annual increase of 4.32% [4] - The current payout ratio is 29%, indicating that 29% of its trailing 12-month EPS has been paid out as dividends [4] Earnings Growth - The Zacks Consensus Estimate for First Bancorp's earnings in 2025 is $3.54 per share, reflecting a year-over-year earnings growth rate of 27.80% [5] Investment Perspective - First Bancorp is considered an attractive dividend play and a compelling investment opportunity, holding a Zacks Rank of 2 (Buy) [7]

Group 1 - First Bank appointed Larry Jackson as the new Chief Credit Officer, effective April 2025, bringing over 21 years of experience in credit risk management [1][2] - CEO Adam Currie expressed excitement about Jackson's appointment, highlighting his expertise and leadership skills as vital for the bank's growth [2] - Jackson is relocating to Greensboro with his family and is committed to community involvement, aligning with the bank's values [2] Group 2 - First Bank, a subsidiary of First Bancorp, is headquartered in Southern Pines, North Carolina, with total assets of approximately $12.1 billion [3] - The bank operates 113 branches in North Carolina and South Carolina, focusing on tailored banking solutions and local expertise [3] - First Bancorp's common stock is traded on the NASDAQ under the symbol "FBNC" [3]