Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ___________________ FORM 10-Q ___________________ ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended: June 30, 2025 ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to Commission File Number: 000-10661 ___________________ (Exact Name of Registrant as Specified in Its Charter) __ ...

Core Insights - TriCo (TCBK) reported revenue of $103.61 million for the quarter ended June 2025, marking a year-over-year increase of 5.9% and a surprise of +2.38% over the Zacks Consensus Estimate of $101.2 million [1] - The EPS for the same period was $0.84, slightly down from $0.87 a year ago, with an EPS surprise of +2.44% compared to the consensus estimate of $0.82 [1] Financial Performance Metrics - Efficiency ratio stood at 59%, better than the estimated 59.9% by analysts [4] - Net Interest Margin was reported at 3.9%, exceeding the average estimate of 3.8% [4] - Average Interest-Earning Assets totaled $8.97 billion, slightly below the two-analyst average estimate of $9.04 billion [4] - Net Interest Income reached $86.52 million, surpassing the three-analyst average estimate of $84.54 million [4] - Total Non-Interest Income was $17.09 million, compared to the average estimate of $16.42 million [4] - Gain on Sale of Loans was $0.5 million, exceeding the estimated $0.44 million by analysts [4] Stock Performance - TriCo's shares have returned +4.3% over the past month, while the Zacks S&P 500 composite has seen a +5.7% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Company Performance - TriCo (TCBK) reported quarterly earnings of $0.84 per share, exceeding the Zacks Consensus Estimate of $0.82 per share, but down from $0.87 per share a year ago, representing an earnings surprise of +2.44% [1] - The company posted revenues of $103.61 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 2.38% and up from $97.86 million year-over-year [2] - Over the last four quarters, TriCo has surpassed consensus EPS estimates four times and topped consensus revenue estimates three times [2] Market Outlook - TriCo shares have underperformed the market, losing about 3.9% since the beginning of the year compared to the S&P 500's gain of 8.1% [3] - The company's earnings outlook will be crucial for future stock performance, with current consensus EPS estimates at $0.85 for the coming quarter and $3.32 for the current fiscal year [7] Industry Context - The Zacks Industry Rank indicates that the Banks - West industry is currently in the top 29% of over 250 Zacks industries, suggesting a favorable environment for stocks in this sector [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact TriCo's stock performance [5]

[Financial Performance Overview](index=1&type=section&id=Financial%20Performance%20Overview) [Q2 2025 Financial Highlights](index=1&type=section&id=2Q25%20Financial%20Highlights) The company reported strong Q2 2025 results driven by loan and deposit growth, leading to higher net income and an expanded net interest margin Key Financial Metrics | Metric | Q2 2025 | Q1 2025 | Change (QoQ) | | :--- | :--- | :--- | :--- | | Net Income | $27.5 million | $26.4 million | +$1.1 million | | Diluted EPS | $0.84 | $0.80 | +$0.04 | | Net Interest Income (FTE) | $86.8 million | $82.8 million | +$4.0 million (4.82%) | | Net Interest Margin (FTE) | 3.88% | 3.73% | +15 bps | | Loan Balances | +8.1% (annualized) | - | - | | Deposit Balances | +8.3% (annualized) | - | - | Key Performance Ratios | Performance Ratio | Q2 2025 | Q1 2025 | | :--- | :--- | :--- | | Return on Average Assets (ROA) | 1.13% | 1.09% | | Return on Average Equity (ROE) | 8.68% | 8.54% | | Efficiency Ratio | 59.00% | 60.42% | - The allowance for credit losses (ACL) to total loans stood at **1.79%**, while non-performing assets to total assets increased to **0.68%**[6](index=6&type=chunk) [Executive Commentary](index=1&type=section&id=Executive%20Commentary) Management highlighted strong loan and deposit growth as key drivers for future net interest income and noted improved operational leverage - President and CEO Rick Smith emphasized that **significant growth in both loans and deposits** was the highlight of the quarter, expecting this to drive net interest income growth for the remainder of 2025[2](index=2&type=chunk) - EVP and CFO Peter Wiese noted a **stable net interest margin outlook** and an improved efficiency ratio, indicating better operating leverage despite higher personnel costs[3](index=3&type=chunk) [Detailed Financial Analysis](index=3&type=section&id=Detailed%20Financial%20Analysis) [Operating Results and Performance Ratios](index=3&type=section&id=Operating%20Results%20and%20Performance%20Ratios) Net income grew quarter-over-quarter on higher revenue but declined year-over-year due to a significantly larger provision for credit losses Quarter-over-Quarter Operating Results | (in thousands) | Q2 2025 | Q1 2025 | % Change | | :--- | :--- | :--- | :--- | | Net Interest Income | $86,519 | $82,542 | 4.8% | | Provision for Credit Losses | ($4,665) | ($3,728) | 25.1% | | Net Income | $27,542 | $26,363 | 4.5% | | Diluted EPS | $0.84 | $0.80 | 5.0% | Year-over-Year Operating Results | (in thousands) | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Net Interest Income | $86,519 | $81,997 | 5.5% | | Provision for Credit Losses | ($4,665) | ($405) | 1,051.9% | | Net Income | $27,542 | $29,034 | (5.1)% | | Diluted EPS | $0.84 | $0.87 | (3.4)% | [Balance Sheet Analysis](index=4&type=section&id=Balance%20Sheet%20Data) The balance sheet expanded with strong annualized growth in both loans and deposits, alongside an increase in shareholders' equity Quarter-over-Quarter Balance Sheet | Ending Balances (in thousands) | June 30, 2025 | March 31, 2025 | Annualized % Change | | :--- | :--- | :--- | :--- | | Total Loans | $6,958,993 | $6,820,774 | 8.1% | | Total Deposits | $8,375,809 | $8,205,332 | 8.3% | | Total Assets | $9,923,983 | $9,819,599 | 4.3% | Year-over-Year Balance Sheet | Ending Balances (in thousands) | June 30, 2025 | June 30, 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Loans | $6,958,993 | $6,742,526 | 3.2% | | Total Deposits | $8,375,809 | $8,050,230 | 4.0% | | Total Assets | $9,923,983 | $9,741,399 | 1.9% | - Total shareholders' equity increased by **$11.3 million** during the quarter, and book value per share increased to **$38.92** from $38.17[9](index=9&type=chunk) - Loan origination volume was elevated at **$457.7 million** for the quarter, compared to $357.5 million in the trailing quarter[10](index=10&type=chunk) [Net Interest Income and Net Interest Margin](index=5&type=section&id=Net%20Interest%20Income%20and%20Net%20Interest%20Margin) Net interest income and margin grew sequentially, driven by higher loan yields, lower deposit costs, and a planned debt repayment Net Interest Income and Margin (FTE) | Metric (FTE) | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Interest Income | $86.8M | $82.8M | $82.3M | | Net Interest Margin | 3.88% | 3.73% | 3.68% | | Yield on Loans | 5.76% | 5.71% | 5.82% | | Cost of Interest-Bearing Deposits | 1.97% | 2.06% | 2.14% | - The QoQ increase in net interest income was attributed to a **$2.3 million improvement** in interest income and a **$1.7 million reduction** in interest expense[21](index=21&type=chunk) - The company plans to repay subordinated debt with a total face value of **$57.7 million** and a weighted average rate of **6.54%** before September 30, 2025[24](index=24&type=chunk) [Asset Quality and Credit Loss Provisioning](index=7&type=section&id=Asset%20Quality%20and%20Credit%20Loss%20Provisioning) Asset quality saw an increased provision for credit losses and a rise in non-performing loans, primarily in the agricultural portfolio Provision for Credit Losses | (in thousands) | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Total Provision for Credit Losses | $4,665 | $3,728 | $405 | - The allowance for credit losses (ACL) was **$124.5 million**, or **1.79% of total loans**, as of June 30, 2025[30](index=30&type=chunk) - Non-performing loans increased by **$9.9 million** during the quarter to **$64.8 million**, concentrated in commercial real estate farmland[35](index=35&type=chunk) - Charge-offs for the quarter totaled **$8.6 million**, primarily related to non-performing relationships that had been fully reserved for in previous quarters[30](index=30&type=chunk) [Non-interest Income](index=9&type=section&id=Non-interest%20Income) Non-interest income grew both sequentially and year-over-year, driven by higher service fees and asset management income Non-interest Income Breakdown | (in thousands) | Q2 2025 | Q1 2025 | % Change | | :--- | :--- | :--- | :--- | | Total Service Charges and Fees | $13,650 | $12,678 | 7.7% | | Gain on Sale of Loans | $503 | $344 | 46.2% | | (Loss) Gain on Sale of Securities | $4 | ($1,146) | 100.3% | | **Total Non-interest Income** | **$17,090** | **$16,073** | **6.3%** | - The prior quarter's results were impacted by two significant non-recurring events: a **$1.2 million loss** on security sales and a **$1.2 million gain** from death benefit proceeds[40](index=40&type=chunk) - Compared to Q2 2024, non-interest income increased by **$1.2 million (7.7%)**, driven by higher service fees and asset management income[41](index=41&type=chunk) [Non-interest Expense](index=11&type=section&id=Non-interest%20Expense) Non-interest expenses rose quarter-over-quarter and year-over-year, primarily due to higher salaries and incentive compensation Non-interest Expense Breakdown | (in thousands) | Q2 2025 | Q1 2025 | % Change | | :--- | :--- | :--- | :--- | | Salaries and Benefits Expense | $38,286 | $36,855 | 3.9% | | Incentive Compensation | $5,223 | $4,038 | 29.3% | | **Total Non-interest Expense** | **$61,131** | **$59,585** | **2.6%** | - The increase in salaries and benefits was largely due to **incentive compensation** associated with increased production volumes for deposits and loans[43](index=43&type=chunk) - Compared to Q2 2024, total non-interest expense increased by **$2.8 million (4.8%)**, with salaries and benefits rising **$2.9 million (8.1%)**[45](index=45&type=chunk) [Provision for Income Taxes](index=12&type=section&id=Provision%20for%20Income%20Taxes) The effective tax rate increased to 27.2% but remained below the statutory rate due to non-taxable revenues and tax credits - The effective tax rate was **27.2%** for Q2 2025, compared to **25.3%** for Q1 2025 and **25.8%** for Q2 2024[47](index=47&type=chunk) - The difference between the effective rate and the statutory rate of **~29.6%** is attributed to non-taxable revenues and tax credits[47](index=47&type=chunk) [Supplementary Information](index=13&type=section&id=Supplementary%20Information) [About TriCo Bancshares & Forward-Looking Statements](index=13&type=section&id=About%20TriCo%20Bancshares%20%26%20Forward-Looking%20Statements) This section provides company background and outlines risks and uncertainties associated with forward-looking statements in the report - TriCo Bancshares (NASDAQ: TCBK) is the parent company of Tri Counties Bank, which was established in 1975 and is headquartered in Chico, California[48](index=48&type=chunk) - The report contains forward-looking statements that are subject to numerous risks and uncertainties, including **macroeconomic conditions and regulatory changes**[49](index=49&type=chunk) [Condensed Consolidated Financial Data](index=14&type=section&id=Condensed%20Consolidated%20Financial%20Data) This section presents unaudited condensed financial tables for the last five quarters, covering key operational and balance sheet metrics - This section presents detailed, unaudited financial tables for the last five quarters (Q2 2024 through Q2 2025)[50](index=50&type=chunk)[51](index=51&type=chunk) - The tables cover comprehensive data including income statements, balance sheets, per-share data, credit quality, and capital ratios[50](index=50&type=chunk)[51](index=51&type=chunk) [Non-GAAP Financial Measures](index=16&type=section&id=Non-GAAP%20Financial%20Measures) This section explains the use of non-GAAP measures and provides reconciliations to their nearest GAAP equivalents for better analysis - The company uses non-GAAP financial measures because it believes they provide useful and comparative information to assess core operational trends[52](index=52&type=chunk) - Reconciliations are provided for key non-GAAP measures such as **pre-tax pre-provision return on average assets** and various **tangible equity metrics**[52](index=52&type=chunk)[54](index=54&type=chunk)

[PART I – FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) This section provides the unaudited financial information for TriCo Bancshares, including detailed financial statements, management's discussion and analysis, market risk disclosures, and internal controls [Item 1 – Financial Statements (Unaudited)](index=5&type=section&id=Item%201%20%E2%80%93%20Financial%20Statements%20(Unaudited)) This section presents TriCo Bancshares' unaudited condensed consolidated financial statements for Q1 2025, covering balance sheets, income statements, and detailed accounting notes [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets increased to $9.82 billion from $9.67 billion at year-end 2024, driven by a rise in cash and cash equivalents and a slight increase in net loans, while liabilities and equity also grew Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $308,250 | $144,956 | | Total loans, net | $6,692,351 | $6,643,157 | | Total assets | $9,819,599 | $9,673,728 | | **Liabilities & Equity** | | | | Total deposits | $8,205,332 | $8,087,576 | | Total liabilities | $8,564,080 | $8,452,821 | | Total shareholders' equity | $1,255,519 | $1,220,907 | [Condensed Consolidated Statements of Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) For the three months ended March 31, 2025, net income decreased to $26.4 million from $27.7 million in Q1 2024, primarily due to slightly lower net interest income and higher non-interest expenses Income Statement Summary (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net interest income | $82,542 | $82,736 | | Provision for credit losses | $3,728 | $4,305 | | Non-interest income | $16,073 | $15,771 | | Non-interest expense | $59,585 | $56,504 | | Net income | $26,363 | $27,749 | | Diluted earnings per share | $0.80 | $0.83 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) These notes detail the company's accounting policies, investment and loan portfolios, credit loss allowance, lease obligations, deposit structures, and regulatory capital adequacy - The company operates as a **single reportable operating segment**, with operations managed on a company-wide basis[27](index=27&type=chunk) - As of March 31, 2025, the company expects to receive all contractual cash flows from its AFS and HTM debt securities portfolio, with **no allowance for credit losses recorded for investment securities**[45](index=45&type=chunk) - The company's capital levels **exceed all capital adequacy requirements** under Basel III Capital Rules as of March 31, 2025, and the bank is considered well capitalized[119](index=119&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=41&type=section&id=Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2025 financial performance, including net income, net interest margin, loan and deposit growth, asset quality, and the company's strong capital and liquidity positions Q1 2025 Financial Highlights | Metric | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Net Income | $26.4 million | $29.0 million | | Diluted EPS | $0.80 | $0.88 | | Net Interest Margin (FTE) | 3.73% | 3.76% | | Provision for Credit Losses | $3.7 million | $1.7 million | | Loan Growth (annualized) | 3.1% | - | | Deposit Growth (annualized) | 5.8% | - | | Non-performing Assets to Total Assets | 0.59% | 0.48% | [Results of Operations](index=43&type=section&id=Results%20of%20Operations) In Q1 2025, net interest income (FTE) was $82.8 million with a net interest margin of 3.73%, while non-interest income increased slightly and non-interest expense rose due to higher salary costs - Net interest income (FTE) for Q1 2025 was **$82.8 million**, a **0.2% decrease** from Q1 2024, with the net interest margin (FTE) at **3.73%**, up 5 basis points from 3.68% in Q1 2024[136](index=136&type=chunk)[139](index=139&type=chunk) - The provision for credit losses was **$3.7 million** in Q1 2025, driven by a **$4.9 million increase** in net reserves on individually evaluated loans, offset by net recoveries and improved economic forecasts[140](index=140&type=chunk)[141](index=141&type=chunk) - Non-interest income increased **1.9% year-over-year to $16.1 million**, which included a **$1.1 million loss** on the sale of investment securities, offset by a **$1.2 million gain** from life insurance death benefit proceeds[148](index=148&type=chunk) - Total non-interest expense rose **5.5% year-over-year to $59.6 million**, primarily due to a **7.4% increase** in salaries and benefits from merit increases and strategic hiring[150](index=150&type=chunk) [Financial Condition](index=49&type=section&id=Financial%20Condition) As of March 31, 2025, total assets reached $9.82 billion, with loans increasing by $52.3 million and deposits growing by $117.8 million, while investment securities decreased Change in Financial Condition (Q1 2025 vs Q4 2024) | Account | March 31, 2025 | December 31, 2024 | $ Change | | :--- | :--- | :--- | :--- | | Total Loans | $6,820,774 | $6,768,523 | $52,251 | | Total Investments | $1,979,116 | $2,036,610 | ($57,494) | | Total Deposits | $8,205,332 | $8,087,576 | $117,756 | - Loan originations and draws totaled approximately **$357.5 million** in Q1 2025, compared to $487.9 million in the trailing quarter[153](index=153&type=chunk) [Nonperforming Assets](index=51&type=section&id=Nonperforming%20Assets) Nonperforming assets increased by $10.7 million to $57.5 million, or 0.59% of total assets, driven by new nonperforming loan additions, though the allowance for credit losses remains strong Nonperforming Assets (in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total nonperforming loans | $54,854 | $44,096 | | Foreclosed assets | $2,685 | $2,786 | | Total nonperforming assets | $57,539 | $46,882 | | NPAs to total assets | 0.59% | 0.48% | | NPLs to total loans | 0.80% | 0.65% | [Capital Resources and Liquidity](index=55&type=section&id=Capital%20Resources%20and%20Liquidity) The company maintains a strong capital position with all regulatory ratios exceeding minimum requirements, supported by increased shareholders' equity and substantial primary liquidity - During Q1 2025, the company repurchased **89,654 shares for $3.7 million** under its 2021 Repurchase Plan[174](index=174&type=chunk)[85](index=85&type=chunk) - Tangible book value per share increased to **$28.73** at March 31, 2025, from $27.60 at December 31, 2024[175](index=175&type=chunk) Regulatory Capital Ratios | Ratio | March 31, 2025 | Minimum Requirement | | :--- | :--- | :--- | | Total risk based capital | 15.8% | 10.5% | | Tier I capital | 14.1% | 8.5% | | Common equity Tier 1 capital | 13.3% | 7.0% | | Leverage | 11.7% | 4.0% | - Total primary liquidity was **$4.08 billion** as of March 31, 2025, representing **156% of estimated total uninsured deposits**[179](index=179&type=chunk) [Item 3 – Quantitative and Qualitative Disclosures about Market Risk](index=59&type=section&id=Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company's primary market risk is interest rate risk, with simulations indicating a 100 basis point increase would decrease net interest income by 2.3% over twelve months Interest Rate Risk Simulation (Instantaneous Shock) | Change in Rates (bps) | Estimated Change in NII (%) | Estimated Change in MVE (%) | | :--- | :--- | :--- | | +300 | (7.2)% | (4.6)% | | +200 | (4.8)% | (2.9)% | | +100 | (2.3)% | (0.6)% | | -100 | 0.1% | (3.1)% | [Item 4 – Controls and Procedures](index=59&type=section&id=Item%204%20%E2%80%93%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal controls over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures were **effective as of March 31, 2025**[191](index=191&type=chunk) - No changes in internal controls over financial reporting materially affected, or are reasonably likely to materially affect, these controls during the first quarter of 2025[192](index=192&type=chunk) [PART II – OTHER INFORMATION](index=60&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) This section covers other information including legal proceedings, risk factors, unregistered sales of equity securities, and a list of exhibits [Item 1 – Legal Proceedings](index=60&type=section&id=Item%201%20%E2%80%93%20Legal%20Proceedings) The company is involved in various legal proceedings in the ordinary course of business, with management not expecting a material adverse effect on financial position or results - The company does not expect that the ultimate costs to resolve pending legal proceedings will have a **material adverse effect** on its consolidated financial position, results of operations, or cash flows[193](index=193&type=chunk) [Item 1A – Risk Factors](index=60&type=section&id=Item%201A%20%E2%80%93%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - The report refers investors to the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024, indicating **no material changes**[194](index=194&type=chunk) [Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds](index=60&type=section&id=Item%202%20%E2%80%93%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the company's stock repurchase activities for the quarter, including 99,776 shares repurchased in March 2025 at an average price of $41.20 per share Share Repurchases in Q1 2025 | Period | Total Shares Purchased | Average Price Paid | Shares Purchased Under Plan | | :--- | :--- | :--- | :--- | | Jan 2025 | — | $— | — | | Feb 2025 | — | $— | — | | Mar 2025 | 99,776 | $41.20 | 89,654 | [Item 6 – Exhibits](index=61&type=section&id=Item%206%20%E2%80%93%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and XBRL data files

Core Viewpoint - TriCo (TCBK) reported quarterly earnings of $0.80 per share, exceeding the Zacks Consensus Estimate of $0.78 per share, but down from $0.83 per share a year ago, indicating a 2.56% earnings surprise [1][2] Financial Performance - The company posted revenues of $98.62 million for the quarter ended March 2025, slightly missing the Zacks Consensus Estimate by 0.04%, and showing a year-over-year increase from $98.51 million [2] - Over the last four quarters, TriCo has surpassed consensus EPS estimates four times and topped consensus revenue estimates two times [2] Stock Performance - TriCo shares have declined approximately 11% since the beginning of the year, compared to a decline of 8.6% for the S&P 500 [3] - The current Zacks Rank for TriCo is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.80 on revenues of $100.95 million, and for the current fiscal year, it is $3.33 on revenues of $408.85 million [7] - The trend of estimate revisions for TriCo is mixed, which could change following the recent earnings report [6] Industry Context - The Zacks Industry Rank for Banks - West is in the bottom 42% of over 250 Zacks industries, suggesting that the industry outlook may negatively impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) [Executive Commentary](index=1&type=section&id=Executive%20Commentary) Management highlighted solid Q1 2025 loan and deposit growth and an 'Outstanding' CRA rating despite margin contraction from prior rate cuts - The company achieved solid loan and deposit growth in a challenging economic environment and received an **'Outstanding' CRA rating**[2](index=2&type=chunk) - **Net interest margin and income slightly decreased** as the impact of previous rate cuts affected floating-rate assets[3](index=3&type=chunk) - Management expects **earning asset yields to increase** and **funding costs to decrease** going forward[3](index=3&type=chunk) [Selected Financial Highlights](index=1&type=section&id=Selected%20Financial%20Highlights) The company reported lower Q1 2025 net income and EPS, a slightly compressed net interest margin, and mixed balance sheet and credit quality indicators Q1 2025 Key Performance Indicators | Metric | Q1 2025 | Trailing Quarter (Q4 2024) | Change | | :--- | :--- | :--- | :--- | | Net Income | $26.4 million | $29.0 million | -$2.6 million | | Diluted EPS | $0.80 | $0.88 | -$0.08 | | Net Interest Margin (FTE) | 3.73% | 3.76% | -3 bps | | Return on Average Assets (ROA) | 1.09% | 1.19% | -10 bps | | Return on Average Equity (ROE) | 8.54% | 9.30% | -76 bps | | Provision for Credit Losses | $3.7 million | $1.7 million | +$2.0 million | - **Loan balances increased by $52.3 million** (3.1% annualized) from the trailing quarter[5](index=5&type=chunk) - **Deposit balances grew by $117.8 million** (5.8% annualized) from the trailing quarter[5](index=5&type=chunk) - The **allowance for credit losses (ACL) to total loans increased to 1.88%** from 1.85% in the trailing quarter, and **non-performing assets to total assets rose to 0.59%** from 0.48%[6](index=6&type=chunk) [Financial Performance](index=3&type=section&id=Financial%20Performance) [Operating Results and Performance Ratios](index=3&type=section&id=Operating%20Results%20and%20Performance%20Ratios) Net income and EPS declined both sequentially and year-over-year in Q1 2025, driven by lower net interest income and a higher provision for credit losses Q1 2025 Income Statement vs. Trailing Quarter (Q4 2024) | (in thousands) | Q1 2025 | Q4 2024 | % Change | | :--- | :--- | :--- | :--- | | Net Interest Income | $82,542 | $84,090 | (1.8)% | | Provision for Credit Losses | $3,728 | $1,702 | 119.0% | | Noninterest Income | $16,073 | $16,275 | (1.2)% | | Noninterest Expense | $59,585 | $59,775 | (0.3)% | | **Net Income** | **$26,363** | **$29,034** | **(9.2)%** | | **Diluted EPS** | **$0.80** | **$0.88** | **(9.1)%** | Q1 2025 Income Statement vs. Prior Year (Q1 2024) | (in thousands) | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Net Interest Income | $82,542 | $82,736 | (0.2)% | | Provision for Credit Losses | $3,728 | $4,305 | (13.4)% | | Noninterest Income | $16,073 | $15,771 | 1.9% | | Noninterest Expense | $59,585 | $56,504 | 5.5% | | **Net Income** | **$26,363** | **$27,749** | **(5.0)%** | | **Diluted EPS** | **$0.80** | **$0.83** | **(3.6)%** | [Net Interest Income and Net Interest Margin](index=5&type=section&id=Net%20Interest%20Income%20and%20Net%20Interest%20Margin) Q1 2025 net interest income and margin decreased sequentially due to lower loan income, though the margin improved slightly from the prior year Net Interest Income and Margin (FTE) - QoQ Change | Metric | Q1 2025 | Q4 2024 | Change | | :--- | :--- | :--- | :--- | | Net Interest Income (FTE) | $82.8M | $84.4M | -$1.6M | | Net Interest Margin (FTE) | 3.73% | 3.76% | -3 bps | | Yield on Loans | 5.71% | 5.78% | -7 bps | | Cost of Interest-Bearing Deposits | 2.06% | 2.15% | -9 bps | - The decrease in net interest income was mainly caused by a **$2.8 million decline in interest income**, led by a $2.3 million reduction in loan income due to the impact of rate cuts on variable rate loans[21](index=21&type=chunk) - Year-over-year, the **cost of interest-bearing deposits increased by 23 basis points**, and the average balance of noninterest-bearing deposits decreased by $132.0 million[22](index=22&type=chunk) - The ratio of average noninterest-bearing deposits to total average deposits **declined to 30.7% in Q1 2025**, down from 31.8% in Q4 2024 and 33.8% in Q1 2024[23](index=23&type=chunk) [Non-interest Income](index=9&type=section&id=Non-interest%20Income) Non-interest income was nearly flat sequentially but increased year-over-year, influenced by a one-time loss on securities sales and gains from life insurance proceeds - Sequentially, non-interest income decreased by $0.2 million, primarily due to a **$1.1 million loss on the sale of investment securities**, offset by **$1.2 million in other income** from life insurance proceeds[34](index=34&type=chunk) - Year-over-year, non-interest income increased by $0.3 million, driven by a **$0.4 million (31.9%) increase in asset management and commission income**[35](index=35&type=chunk) Non-interest Income Breakdown (in thousands) | Category | Q1 2025 | Q4 2024 | Q1 2024 | | :--- | :--- | :--- | :--- | | Total service charges and fees | $12,678 | $13,115 | $12,637 | | (Loss) gain on sale of investment securities | $(1,146) | $— | $— | | Asset management and commission income | $1,488 | $1,584 | $1,128 | | Other income | $1,439 | $108 | $497 | | **Total non-interest income** | **$16,073** | **$16,275** | **$15,771** | [Non-interest Expense](index=10&type=section&id=Non-interest%20Expense) Non-interest expense remained stable sequentially but rose year-over-year, primarily due to higher salaries and benefits from merit increases and strategic hiring - Compared to the trailing quarter, total non-interest expense decreased slightly by $0.2 million as a **$1.5 million rise in salaries and benefits** was offset by reductions in other expense lines[36](index=36&type=chunk) - Compared to the prior year, total non-interest expense **increased by $3.1 million (5.5%)**, mainly due to a **$2.6 million increase in salaries and benefits** from merit increases and strategic hiring[38](index=38&type=chunk) Non-interest Expense Breakdown (in thousands) | Category | Q1 2025 | Q4 2024 | Q1 2024 | | :--- | :--- | :--- | :--- | | Salaries and benefits expense | $36,855 | $35,326 | $34,304 | | Total other non-interest expense | $22,730 | $24,449 | $22,200 | | **Total non-interest expense** | **$59,585** | **$59,775** | **$56,504** | [Balance Sheet and Capital](index=3&type=section&id=Balance%20Sheet%20and%20Capital) [Balance Sheet Overview](index=3&type=section&id=Balance%20Sheet%20Data) The balance sheet shows modest loan growth, an improved loan-to-deposit ratio, and an increase in shareholders' equity and book value per share - Total loans were **$6.8 billion**, up 0.3% YoY and 3.1% annualized QoQ[9](index=9&type=chunk) - The **loan-to-deposit ratio was 83.1%** at quarter-end, compared to 85.1% a year prior[9](index=9&type=chunk) - **Shareholders' equity grew by $34.6 million** in the quarter, driven by net income and a decrease in AOCI losses, partially offset by dividends and share repurchases[10](index=10&type=chunk) Book Value Per Share | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Book Value Per Share | $38.17 | $37.03 | | Tangible Book Value Per Share (Non-GAAP) | $28.73 | $27.60 | [Balance Sheet Changes](index=4&type=section&id=Balance%20Sheet%20Changes) Total assets grew from the prior quarter driven by deposit and loan growth, while year-over-year asset levels remained flat as investment decreases offset deposit increases Trailing Quarter Balance Sheet Change (Annualized %) | (in thousands) | March 31, 2025 | Dec 31, 2024 | Annualized % Change | | :--- | :--- | :--- | :--- | | Total Assets | $9,819,599 | $9,673,728 | 6.0% | | Total Loans | $6,820,774 | $6,768,523 | 3.1% | | Total Investments | $1,979,116 | $2,036,610 | (11.3)% | | Total Deposits | $8,205,332 | $8,087,576 | 5.8% | Year-Over-Year Balance Sheet Change | (in thousands) | March 31, 2025 | March 31, 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Assets | $9,819,599 | $9,813,767 | 0.1% | | Total Loans | $6,820,774 | $6,800,695 | 0.3% | | Total Investments | $1,979,116 | $2,221,555 | (10.9)% | | Total Deposits | $8,205,332 | $7,987,658 | 2.7% | | Total other borrowings | $91,706 | $392,409 | (76.6)% | [Credit Quality](index=7&type=section&id=Credit%20Quality) [Asset Quality and Credit Loss Provisioning](index=7&type=section&id=Asset%20Quality%20and%20Credit%20Loss%20Provisioning) Credit quality metrics weakened in Q1 2025, with a higher provision for credit losses, an increased ACL ratio, and a rise in non-performing and classified loans - The **provision for credit losses was $3.7 million**, compared to $1.7 million in Q4 2024 and $4.3 million in Q1 2024, with the increase mainly due to higher reserves on individually evaluated loans[25](index=25&type=chunk)[26](index=26&type=chunk) Key Credit Quality Ratios | Metric | Mar 31, 2025 | Dec 31, 2024 | Mar 31, 2024 | | :--- | :--- | :--- | :--- | | ACL to Total Loans | 1.88% | 1.85% | 1.83% | | Non-performing Assets to Total Assets | 0.59% | 0.48% | 0.37% | | Classified Loans to Total Loans | 1.94% | 1.74% | 1.12% | - **Non-performing loans increased to $54.9 million** from $44.1 million in the trailing quarter[29](index=29&type=chunk) - Management noted that while general economic indicators are improving, uncertainties related to inflation, monetary policy, and geopolitical risks warrant maintaining a **robust reserve level**[28](index=28&type=chunk) [Other Information](index=11&type=section&id=Other%20Information) [Provision for Income Taxes](index=11&type=section&id=Provision%20for%20Income%20Taxes) The company's effective tax rate for Q1 2025 was 25.3%, remaining below the statutory rate due to non-taxable revenues and tax credits Effective Tax Rate Comparison | Period | Effective Tax Rate | | :--- | :--- | | Q1 2025 | 25.3% | | Q4 2024 | 25.3% | | Q1 2024 | 26.4% | [Forward-Looking Statements](index=13&type=section&id=Forward-Looking%20Statements) The report includes cautionary language regarding forward-looking statements, highlighting various risks that could affect future performance - The report identifies numerous risks that could impact future results, such as **economic volatility, interest rate changes, regulatory impacts, credit quality deterioration, and cybersecurity incidents**[42](index=42&type=chunk) [Appendix: Financial Data and Non-GAAP Reconciliation](index=14&type=section&id=Appendix%3A%20Financial%20Data%20and%20Non-GAAP%20Reconciliation) The appendix contains detailed five-quarter financial data and reconciles GAAP to non-GAAP measures like tangible book value and pre-provision returns - Presents **condensed consolidated financial data** for the five quarters ending March 31, 2025[43](index=43&type=chunk)[44](index=44&type=chunk) - Provides **reconciliations for non-GAAP financial measures**, including tangible common equity, tangible book value per share, and pre-tax pre-provision returns[45](index=45&type=chunk)[47](index=47&type=chunk)

Part I [Item 1. Business](index=6&type=section&id=Item%201.%20Business) TriCo Bancshares, a bank holding company, operates Tri Counties Bank, a California-chartered commercial bank with approximately $9.7 billion in assets as of December 31, 2024, providing comprehensive banking services throughout California under extensive federal and state regulation. - TriCo Bancshares is the holding company for Tri Counties Bank, a California-chartered commercial bank headquartered in Chico, California[19](index=19&type=chunk) Loan Portfolio Composition (as of December 31, 2024) | Loan Category | Amount (millions) | Percentage of Total | | :--- | :--- | :--- | | Commercial Real Estate | $4,600 | 67.6% | | Consumer Loans | $1,300 | 18.9% | | Commercial and Industrial | $471.3 | 7.1% | | Real Estate Construction | $279.9 | 4.1% | - As of December 31, 2024, the company employed **1,201 people**, with a focus on a corporate culture valuing trust, respect, integrity, communication, and opportunity[27](index=27&type=chunk)[28](index=28&type=chunk) - The company and its bank are subject to extensive regulation by the Federal Reserve Board (FRB), the Federal Deposit Insurance Corporation (FDIC), and the California Department of Financial Protection & Innovation (DFPI)[36](index=36&type=chunk)[37](index=37&type=chunk)[38](index=38&type=chunk) - The company is approaching the **$10 billion total asset threshold**, which will subject it to examination by the Consumer Financial Protection Bureau (CFPB) and regulations that cap debit card interchange fees (Durbin Amendment)[39](index=39&type=chunk)[90](index=90&type=chunk) [Item 1A. Risk Factors](index=16&type=section&id=Item%201A.%20Risk%20Factors) The company identifies several material risks to its business, including credit risk from its loan portfolio heavily concentrated in California real estate, geographic concentration, interest rate fluctuations, operational risks from cybersecurity threats, and increased regulatory burdens from approaching the $10 billion asset threshold. - The company's business is geographically concentrated in California, making it susceptible to local economic conditions, natural disasters, and declines in real estate values[109](index=109&type=chunk)[110](index=110&type=chunk)[111](index=111&type=chunk) - A substantial portion of the loan portfolio consists of commercial real estate loans, totaling approximately **$4.6 billion (67.6% of total loans)** as of December 31, 2024, which carries significant credit risk[112](index=112&type=chunk) - The company's profitability is highly sensitive to interest rate risk, as changes can affect net interest income, loan origination, and the fair value of financial assets and liabilities[127](index=127&type=chunk) - In February 2023, the Bank experienced a criminal cyberattack that temporarily interrupted systems and resulted in the unauthorized access and acquisition of personal information for approximately **75,000 individuals**, leading to litigation and governmental inquiries[159](index=159&type=chunk)[160](index=160&type=chunk)[161](index=161&type=chunk) - Crossing the **$10 billion asset threshold** will subject the company to increased regulation, including supervision by the CFPB and a cap on debit card interchange fees, which would reduce revenue[147](index=147&type=chunk)[148](index=148&type=chunk) [Item 1B. Unresolved Staff Comments](index=31&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the SEC. - None[209](index=209&type=chunk) [Item 1C. Cybersecurity](index=31&type=section&id=Item%201C.%20Cybersecurity) The company outlines its cybersecurity risk management and strategy, guided by the NIST Cybersecurity Framework, with oversight from the CISO and the IT/Cybersecurity Committee of the Board of Directors, referencing the material cyberattack in February 2023 and other incidents. - The company's cybersecurity program is structured around the National Institute of Standards and Technology (NIST) Cybersecurity Framework to identify, assess, and manage risks[212](index=212&type=chunk) - Governance includes oversight from the Board of Directors' IT/Cybersecurity Committee, which meets at least quarterly and receives regular updates from the CISO[220](index=220&type=chunk) - The company experienced a material cyberattack in February 2023 that resulted in system interruptions and data disclosure, and also noted an incident in 2023 where a third-party vendor was affected by a vulnerability in the MOVEit Transfer file sharing software[221](index=221&type=chunk)[222](index=222&type=chunk) [Item 2. Properties](index=33&type=section&id=Item%202.%20Properties) As of December 31, 2024, the company operates through a network of 64 traditional branches, 4 in-store branches, and 8 loan production offices across 31 counties in California, owning 31 branch locations and leasing 30, in addition to other administrative and operational facilities. - The company's physical presence includes **64 traditional branches, 4 in-store branches, and 8 loan production offices** across California[224](index=224&type=chunk) - As of December 31, 2024, the company owned **31 branch office locations** and leased **30 branch office locations**, along with various other owned and leased administrative and operational buildings[225](index=225&type=chunk) [Item 3. Legal Proceedings](index=34&type=section&id=Item%203.%20Legal%20Proceedings) The company is subject to routine legal proceedings in the ordinary course of business, noting litigation related to the 2023 cybersecurity attack but stating no pending legal proceedings are expected to have a material adverse impact. - The company is subject to routine legal proceedings; while litigation from the 2023 cybersecurity attack is mentioned, management does not currently expect any pending proceedings to have a material adverse impact[226](index=226&type=chunk) [Item 4. Mine Safety Disclosures](index=34&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company. - Not applicable[227](index=227&type=chunk) Part II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=35&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock is traded on the Nasdaq under the symbol "TCBK", with approximately 1,720 shareholders of record as of February 24, 2025, and a stock performance graph comparing its cumulative total shareholder return against the Russell 3000 Index and the S&P Western Bank Index for the five-year period ending December 31, 2024. - The company's common stock trades on the Nasdaq under the symbol **"TCBK"**[229](index=229&type=chunk) Cumulative Total Return (2019-2024) | Index | 12/31/2019 | 12/31/2024 | | :--- | :--- | :--- | | TriCo Bancshares | $100.00 | $123.34 | | Russell 3000 Index | $100.00 | $177.92 | | S&P Western Bank Index | $100.00 | $109.09 | [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=36&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In 2024, net income decreased 2.1% to $114.9 million, primarily due to a 7.2% decline in net interest income as higher funding costs compressed the net interest margin to 3.71%, partially offset by a significantly lower provision for credit losses, while total assets decreased slightly to $9.7 billion, with deposits growing 3.2% to $8.1 billion, allowing for an 85.8% reduction in higher-cost borrowings, and nonperforming assets increased to 0.48% of total assets, up from 0.35% in the prior year, while the allowance for credit losses remained robust at 1.85% of total loans. [Financial Overview](index=36&type=section&id=Financial%20Overview) For the fiscal year 2024, the company reported a net income of $114.9 million, a 2.1% decrease from the prior year, with diluted EPS down 1.7% to $3.46, primarily driven by higher interest expense causing net interest income to fall, partially mitigated by a lower provision for credit losses, and the tangible common equity to tangible assets ratio improved to 9.72% from 8.80% at the end of 2023. Key Financial Results (Year ended December 31) | Metric | 2024 | 2023 | 2022 | | :--- | :--- | :--- | :--- | | Net Income | $114.9M | $117.4M | $125.4M | | Diluted EPS | $3.46 | $3.52 | $3.83 | | Net Interest Income | $331.4M | $356.7M | $346.0M | | Provision for Credit Losses | $6.6M | $24.0M | $18.5M | | Return on Average Assets | 1.18% | 1.19% | 1.28% | | Return on Average Equity | 9.57% | 10.65% | 11.67% | - The tangible common equity to tangible assets ratio, a non-GAAP measure, increased to **9.72%** at December 31, 2024, up from **8.80%** at the end of 2023, primarily due to retained earnings[239](index=239&type=chunk)[246](index=246&type=chunk) [Results of Operations](index=40&type=section&id=Results%20of%20Operations) Net interest income (FTE) for 2024 decreased by 7.2% to $332.5 million, with the net interest margin contracting 25 basis points to 3.71% due to rising funding costs, while the provision for credit losses fell significantly to $6.6 million from $24.0 million in 2023, non-interest income grew 4.9% to $64.4 million, and non-interest expense remained relatively flat, increasing by only 0.4% to $234.1 million, with an effective tax rate of 25.9%. - Net interest income (FTE) decreased by **$25.7 million (7.2%)** in 2024, driven by a **25 basis point decline** in net interest margin to **3.71%** as the cost of interest-bearing liabilities rose 85 basis points[259](index=259&type=chunk) - The provision for credit losses decreased by **$17.4 million** to **$6.6 million** in 2024, primarily due to muted loan growth and more stable qualitative reserve levels compared to 2023[269](index=269&type=chunk) - Non-interest income increased by **$3.0 million (4.9%)** in 2024, mainly from higher service charges on deposit accounts and increased asset management income[273](index=273&type=chunk) - Non-interest expense increased by just **$0.9 million (0.4%)** in 2024, with higher salaries and data processing costs largely offset by lower intangible amortization and operational losses[276](index=276&type=chunk) [Financial Condition](index=46&type=section&id=Financial%20Condition) As of December 31, 2024, total assets stood at $9.7 billion, a slight decrease from the prior year, with the loan portfolio stable at $6.8 billion, commercial real estate representing 67.6%, and a key strategic shift involving using a $253.5 million increase in deposits and $269.3 million in investment security repayments to pay down $543.0 million in higher-cost borrowings, while total uninsured deposits were estimated at $2.6 billion. Year-End Balance Sheet Changes (2024 vs. 2023) | Balance Sheet Item | Dec 31, 2024 | Dec 31, 2023 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Total Assets | $9,673.7M | $9,910.1M | ($236.4M) | (2.4)% | | Total Loans | $6,768.5M | $6,794.5M | ($25.9M) | (0.4)% | | Total Deposits | $8,087.6M | $7,834.0M | $253.5M | 3.2% | | Total Other Borrowings | $89.6M | $632.6M | ($543.0M) | (85.8)% | - The loan portfolio composition remained heavily weighted towards commercial real estate, which constituted **67.6%** of total loans at year-end 2024[287](index=287&type=chunk) - Total uninsured deposits were estimated to be approximately **$2.6 billion** as of December 31, 2024[312](index=312&type=chunk) [Asset Quality and Nonperforming Assets](index=47&type=section&id=Asset%20Quality%20and%20Nonperforming%20Assets) Asset quality metrics showed some deterioration in 2024, with total nonperforming assets (NPAs) increasing by 35.5% to $46.9 million, representing 0.48% of total assets, up from 0.35% in 2023, driven by $27.6 million in new nonperforming loans, despite which the allowance for credit losses (ACL) was strengthened, increasing to $125.4 million, or 1.85% of total loans, which management believes is adequate. Nonperforming Assets (NPA) Trend | Metric | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | :--- | | Total NPAs | $46.9M | $34.6M | $24.8M | | NPAs to Total Assets | 0.48% | 0.35% | 0.25% | | Nonperforming Loans to Total Loans | 0.65% | 0.47% | 0.33% | - The increase in nonperforming assets during 2024 was primarily due to **$27.6 million** in additions of nonperforming loans, partially offset by **$11.5 million** in paydowns/upgrades and **$3.7 million** in net charge-offs[292](index=292&type=chunk) Allowance for Credit Losses (ACL) | Metric | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Total ACL | $125.4M | $121.5M | | ACL to Gross Loans | 1.85% | 1.79% | [Market Risk Management and Liquidity](index=54&type=section&id=Market%20Risk%20Management%20and%20Liquidity) The company manages market risk, primarily interest rate risk, through simulation modeling, with a simulated 100 basis point instantaneous rate increase projected to decrease net interest income by 2.4% as of December 31, 2024, and maintained a strong liquidity position with $4.1 billion in primary liquidity sources, covering 160% of its estimated $2.6 billion in uninsured deposits. Interest Rate Risk Simulation (as of Dec 31, 2024) | Change in Interest Rates (Basis Points) | Estimated Change in Net Interest Income (NII) | | :--- | :--- | | +300 | (7.4)% | | +200 | (5.1)% | | +100 | (2.4)% | | -100 | 0.6% | - The simulation indicates the company's balance sheet is **liability-sensitive**, meaning net interest income is projected to decrease if interest rates rise and increase if they fall[322](index=322&type=chunk) Liquidity Position (as of Dec 31, 2024) | Metric | Amount (billions) | | :--- | :--- | | Total Primary Liquidity | $4.1 | | Estimated Uninsured Deposits | $2.6 | | Liquidity Coverage of Uninsured Deposits | 160% | [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=59&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section incorporates by reference the "Market Risk Management" discussion from Item 7, which details the company's approach to managing interest rate risk through simulation modeling and asset/liability management. - Information regarding market risk is incorporated by reference from the "Market Risk Management" section in Item 7[345](index=345&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=60&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited consolidated financial statements for the fiscal years ended December 31, 2024, 2023, and 2022, including the Consolidated Balance Sheets, Statements of Income, Comprehensive Income, Changes in Shareholders' Equity, and Cash Flows, along with extensive notes providing detailed explanations of accounting policies and financial data, and Management's Report on Internal Control over Financial Reporting and the corresponding report from the independent registered public accounting firm, Moss Adams LLP. Consolidated Balance Sheet Summary (as of Dec 31) | (In thousands) | 2024 | 2023 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $144,956 | $98,701 | | Total loans, net | $6,643,157 | $6,672,948 | | Total investment securities | $2,036,610 | $2,305,882 | | Goodwill | $304,442 | $304,442 | | **Total Assets** | **$9,673,728** | **$9,910,089** | | **Liabilities & Equity** | | | | Total deposits | $8,087,576 | $7,834,038 | | Other borrowings | $89,610 | $632,582 | | Junior subordinated debt | $101,191 | $101,099 | | **Total Liabilities** | **$8,452,821** | **$8,750,407** | | **Total Shareholders' Equity** | **$1,220,907** | **$1,159,682** | Consolidated Income Statement Summary (Year ended Dec 31) | (In thousands) | 2024 | 2023 | 2022 | | :--- | :--- | :--- | :--- | | Net Interest Income | $331,434 | $356,677 | $345,976 | | Provision for Credit Losses | $6,632 | $23,990 | $18,470 | | Noninterest Income | $64,407 | $61,400 | $63,046 | | Noninterest Expense | $234,105 | $233,182 | $216,645 | | **Net Income** | **$114,868** | **$117,390** | **$125,419** | - The report from the independent auditor, Moss Adams LLP, provides an unqualified opinion on the financial statements and the effectiveness of internal control over financial reporting, identifying the Allowance for Credit Losses, specifically the qualitative forecast factors, as a critical audit matter due to the significant management judgment involved[557](index=557&type=chunk)[563](index=563&type=chunk)[565](index=565&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=118&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure. - None[569](index=569&type=chunk) [Item 9A. Controls and Procedures](index=118&type=section&id=Item%209A.%20Controls%20and%20Procedures) Based on an evaluation as of December 31, 2024, the company's Chief Executive Officer and Chief Financial Officer concluded that disclosure controls and procedures were effective, with management's report on internal control over financial reporting and the auditor's attestation included in the report, and no material changes to internal controls identified in the fourth quarter of 2024. - The CEO and CFO concluded that as of December 31, 2024, the company's disclosure controls and procedures were effective[570](index=570&type=chunk) - No changes in internal control over financial reporting occurred during the fourth quarter of 2024 that materially affected, or are reasonably likely to materially affect, these controls[572](index=572&type=chunk) [Item 9B. Other Information](index=118&type=section&id=Item%209B.%20Other%20Information) All required information was disclosed in current reports on Form 8-K during the fourth quarter of 2024. - All required information was disclosed in Form 8-K filings during the fourth quarter of 2024[573](index=573&type=chunk) Part III [Items 10-14](index=119&type=section&id=Item%2010%2C%2011%2C%2012%2C%2013%2C%2014) Information required for Items 10 through 14, covering Directors, Executive Officers, Corporate Governance, Executive Compensation, Security Ownership, Certain Relationships, and Principal Accountant Fees, is incorporated by reference from the company's definitive proxy statement for the 2025 annual meeting of shareholders. - Information for Items 10, 11, 12, 13, and 14 is incorporated by reference from the company's Proxy Statement for the 2025 annual meeting of shareholders[576](index=576&type=chunk)[578](index=578&type=chunk)[579](index=579&type=chunk) Part IV [Item 15. Exhibits and Financial Statement Schedules](index=120&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists the financial statements, schedules, and exhibits filed as part of the Form 10-K report, with consolidated financial statements included in Item 8 and financial statement schedules omitted as they are not applicable or the required information is included elsewhere, and a detailed index of all filed exhibits is provided. - This section contains the list of financial statements and exhibits filed with the report; financial statement schedules were omitted as they were not applicable[584](index=584&type=chunk) [Item 16. Form 10-K Summary](index=122&type=section&id=Item%2016.%20Form%2010-K%20Summary) The company indicates that there is no Form 10-K summary. - None[591](index=591&type=chunk)

Group 1 - TriCo (TCBK) reported quarterly earnings of $0.88 per share, exceeding the Zacks Consensus Estimate of $0.82 per share, and up from $0.78 per share a year ago, representing an earnings surprise of 7.32% [1] - The company posted revenues of $100.37 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 1.43%, although this is a decrease from year-ago revenues of $102.66 million [2] - TriCo has surpassed consensus EPS estimates four times over the last four quarters and topped consensus revenue estimates two times during the same period [2] Group 2 - The stock has underperformed the market, losing about 1.7% since the beginning of the year compared to the S&P 500's gain of 3.5% [3] - The current consensus EPS estimate for the coming quarter is $0.76 on revenues of $96.95 million, and for the current fiscal year, it is $3.31 on revenues of $404.7 million [7] - The Zacks Industry Rank for Banks - West is currently in the top 32% of over 250 Zacks industries, indicating a favorable outlook for the industry [8]

[Financial Highlights & Executive Commentary](index=1&type=section&id=Financial%20Highlights%20%26%20Executive%20Commentary) This section provides an overview of TriCo Bancshares' financial performance and strategic commentary from its leadership [Executive Commentary and Selected Financial Highlights](index=1&type=section&id=Executive%20Commentary%20and%20Selected%20Financial%20Highlights) TriCo Bancshares reported a stable fourth quarter for 2024, with net income of **$29.0 million** and diluted EPS of **$0.88**, consistent with the previous quarter, driven by expanded net interest margin and income due to reduced funding costs and effective asset deployment - CEO Rick Smith emphasized the company's focus on navigating industry changes to create significant opportunities for performance elevation as it approaches its 50th anniversary[2](index=2&type=chunk) - CFO Peter Wiese noted that net interest margin and income expanded for the second straight quarter, driven by lower funding costs and deploying cash into higher-yielding assets, despite three Federal Funds rate cuts[3](index=3&type=chunk) Q4 2024 Key Financial Metrics | Metric | Q4 2024 Value | Change vs. Q3 2024 | Change vs. Q4 2023 | | :--- | :--- | :--- | :--- | | Net Income | $29.0 million | -$0.1 million | +$3.0 million | | Diluted EPS | $0.88 | Unchanged | +$0.10 | | Net Interest Margin (FTE) | 3.76% | +5 bps | -5 bps | | Loan Balances (in billions) | $6.77 | +$84.6 million (5.1% ann.) | -$25.9 million (-0.4%) | | Deposit Balances (in billions) | $8.09 | +$50.5 million (2.5% ann.) | +$253.5 million (3.2%) | | Return on Average Assets | 1.19% | -1 bp | +14 bps | | Return on Average Equity | 9.30% | -22 bps | -13 bps | | Efficiency Ratio | 59.56% | -46 bps | +85 bps | | ACL to Total Loans | 1.85% | Unchanged | +6 bps | [Financial Performance Analysis](index=3&type=section&id=Financial%20Performance%20Analysis) This section details the company's operating results, balance sheet changes, net interest income, asset quality, and expense management [Operating Results and Performance Ratios](index=3&type=section&id=Operating%20Results%20and%20Performance%20Ratios) In Q4 2024, net income was **$29.0 million**, nearly flat compared to Q3 2024 but up **11.3%** from Q4 2023, with diluted EPS remaining at **$0.88** QoQ and increasing by **12.8%** YoY, while the full year 2024 net income slightly decreased by **2.1%** to **$114.9 million** Q4 2024 vs. Q3 2024 Performance | Metric | Q4 2024 (in millions) | Q3 2024 (in millions) | Change (in millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $84.09 | $82.611 | $1.479 | 1.8% | | Provision for Credit Losses | $1.702 | $0.22 | $1.482 | 673.6% | | Net Income | $29.034 | $29.051 | ($0.017) | (0.1)% | | Diluted EPS | $0.88 | $0.88 | $0.00 | 0.0% | Q4 2024 vs. Q4 2023 Performance | Metric | Q4 2024 (in millions) | Q4 2023 (in millions) | Change (in millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Net Income | $29.034 | $26.075 | $2.959 | 11.3% | | Diluted EPS | $0.88 | $0.78 | $0.10 | 12.8% | | Provision for Credit Losses | $1.702 | $5.99 | ($4.288) | (71.6)% | | Dividends per share | $0.33 | $0.30 | $0.03 | 10.0% | Full Year 2024 vs. 2023 Performance | Metric | FY 2024 (in millions) | FY 2023 (in millions) | Change (in millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $331.434 | $356.677 | ($25.243) | (7.1)% | | Net Income | $114.868 | $117.39 | ($2.522) | (2.1)% | | Diluted EPS | $3.46 | $3.52 | ($0.06) | (1.7)% | | Dividends per share | $1.32 | $1.20 | $0.12 | 10.0% | [Balance Sheet Analysis](index=4&type=section&id=Balance%20Sheet%20Analysis) As of December 31, 2024, total assets stood at **$9.67 billion**, a **2.4%** decrease year-over-year, with total loans stable at **$6.8 billion** and deposits growing **3.2%** YoY to **$8.09 billion**, while primary liquidity remained strong at **$4.1 billion**, covering **160%** of estimated uninsured deposits Balance Sheet Changes (Q4 2024 vs Q3 2024) | Balance Sheet Item | Dec 31, 2024 (in billions) | Sep 30, 2024 (in billions) | $ Change (in millions) | Annualized % Change | | :--- | :--- | :--- | :--- | :--- | | Total Assets | $9.674 | $9.824 | ($150.162) | (6.1)% | | Total Loans | $6.769 | $6.684 | $84.632 | 5.1% | | Total Deposits | $8.088 | $8.037 | $50.485 | 2.5% | | Total Other Borrowings (in millions) | $89.61 | $266.767 | ($177.157) | (265.6)% | Balance Sheet Changes (Year-Over-Year) | Balance Sheet Item | Dec 31, 2024 (in billions) | Dec 31, 2023 (in billions) | $ Change (in millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Total Assets | $9.674 | $9.91 | ($236.361) | (2.4)% | | Total Loans | $6.769 | $6.794 | ($25.947) | (0.4)% | | Total Investments (in billions) | $2.037 | $2.306 | ($269.272) | (11.7)% | | Total Deposits | $8.088 | $7.834 | $253.538 | 3.2% | | Total Other Borrowings (in millions) | $89.61 | $632.582 | ($542.972) | (85.8)% | - Shareholders' equity decreased by **$18.1 million** in Q4 2024 due to a **$35.5 million** increase in accumulated other comprehensive losses and **$10.9 million** in dividends, which offset the **$29.0 million** in net income, resulting in a decrease in book value per share from **$37.55** to **$37.03**[9](index=9&type=chunk) - Total primary liquidity was **$4.12 billion** as of December 31, 2024, representing **51%** of total deposits and **160%** of estimated uninsured deposits, indicating a strong liquidity position[15](index=15&type=chunk) [Net Interest Income and Net Interest Margin](index=5&type=section&id=Net%20Interest%20Income%20and%20Net%20Interest%20Margin) Net interest income (FTE) increased by **1.8%** QoQ to **$84.4 million** in Q4 2024, while the net interest margin (NIM) expanded by **5 basis points** to **3.76%**, primarily driven by a **$2.0 million** decrease in interest expense from lower borrowing balances and an improved deposit mix - Net interest income and net interest margin increased for the second consecutive quarter, rising from **$82.3 million** and **3.68%** in Q2 2024 to **$84.4 million** and **3.76%** in Q4 2024[16](index=16&type=chunk) Net Interest Income and Margin (FTE) - Quarterly Comparison | Metric | Q4 2024 (in millions) | Q3 2024 (in millions) | Change (in millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Interest Income | $116.842 | $117.347 | ($0.505) | (0.4)% | | Interest Expense | $32.752 | $34.736 | $1.984 | (5.7)% | | Net Interest Income (FTE) | $84.356 | $82.88 | $1.476 | 1.8% | | Net Interest Margin (FTE) | 3.76% | 3.71% | +0.05% | - | Net Interest Income and Margin (FTE) - Year-Over-Year Comparison | Metric | Q4 2024 (in millions) | Q4 2023 (in millions) | Change (in millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Interest Income | $116.842 | $115.909 | $0.933 | 0.8% | | Interest Expense | $32.752 | $29.292 | ($3.46) | 11.8% | | Net Interest Income (FTE) | $84.356 | $86.977 | ($2.621) | (3.0)% | | Net Interest Margin (FTE) | 3.76% | 3.81% | (0.05)% | - | - The QoQ increase in net interest income was mainly due to a **$1.1 million** drop in interest expense on borrowings and a **$0.8 million** decrease in deposit interest expense, which offset a **$0.5 million** decline in interest income from earning assets[23](index=23&type=chunk) [Asset Quality and Credit Loss Provisioning](index=8&type=section&id=Asset%20Quality%20and%20Credit%20Loss%20Provisioning) The provision for credit losses was **$1.7 million** in Q4 2024, up from **$0.2 million** in Q3 2024 but significantly lower than the **$6.0 million** in Q4 2023, with the allowance for credit losses (ACL) to total loans ratio remaining stable at **1.85%** QoQ Provision for Credit Losses | Metric | Q4 2024 (in thousands) | Q3 2024 (in thousands) | Q4 2023 (in thousands) | | :--- | :--- | :--- | :--- | | Total provision for credit losses | $1,702 | $220 | $5,990 | Allowance for Credit Losses (ACL) Roll-Forward (Quarterly) | Metric | Q4 2024 (in thousands) | Q4 2023 (in thousands) | | :--- | :--- | :--- | | Balance, beginning of period | $123,760 | $115,812 | | Provision for credit losses | $1,812 | $6,040 | | Loans charged-off | ($722) | ($749) | | Recoveries | $516 | $419 | | Balance, end of period | $125,366 | $121,522 | - Non-performing loans increased by **$2.5 million** during the quarter to **$44.1 million** and non-performing assets to total assets rose to **0.48%** from **0.45%** in the prior quarter[32](index=32&type=chunk)[35](index=35&type=chunk) - The ratio of classified loans to total loans was **1.74%** at year-end, up from **1.29%** a year prior, but remains consistent with pre-pandemic levels and reflects a conservative approach to credit risk monitoring[33](index=33&type=chunk) [Non-interest Income](index=10&type=section&id=Non-interest%20Income) Total non-interest income for Q4 2024 was **$16.3 million**, a slight decrease of **1.3%** from Q3 2024, primarily due to a **$0.4 million** decline in the value of equity securities, while year-over-year, non-interest income increased by **1.5%** Non-interest Income Comparison (Q4 2024 vs. Q3 2024) | Metric | Q4 2024 (in thousands) | Q3 2024 (in thousands) | Change (in thousands) | % Change | | :--- | :--- | :--- | :--- | :--- | | Total service charges and fees | $13,115 | $12,782 | $333 | 2.6% | | (Loss) gain on marketable equity securities | ($81) | $356 | ($437) | (122.8)% | | Total non-interest income | $16,275 | $16,495 | ($220) | (1.3)% | Non-interest Income Comparison (Q4 2024 vs. Q4 2023) | Metric | Q4 2024 (in thousands) | Q4 2023 (in thousands) | Change (in thousands) | % Change | | :--- | :--- | :--- | :--- | :--- | | Asset management and commission income | $1,584 | $1,284 | $300 | 23.4% | | Total non-interest income | $16,275 | $16,040 | $235 | 1.5% | - For the full year 2024, non-interest income increased by **$3.0 million** (**4.9%**) compared to 2023, driven by a **$1.9 million** increase in service charges on deposit accounts and a **$1.1 million** increase in asset management income[39](index=39&type=chunk) [Non-interest Expense](index=12&type=section&id=Non-interest%20Expense) Non-interest expense in Q4 2024 was **$59.8 million**, a marginal increase of **0.5%** from Q3 2024, with salaries and benefits, the largest component, decreasing slightly by **0.6%** QoQ, while full year 2024 expenses were nearly flat, increasing just **0.4%** to **$234.1 million** Non-interest Expense Comparison (Q4 2024 vs. Q3 2024) | Metric | Q4 2024 (in thousands) | Q3 2024 (in thousands) | Change (in thousands) | % Change | | :--- | :--- | :--- | :--- | :--- | | Total salaries and benefits expense | $35,326 | $35,550 | ($224) | (0.6)% | | Data processing and software | $5,493 | $5,258 | $235 | 4.5% | | Total non-interest expense | $59,775 | $59,487 | $288 | 0.5% | Non-interest Expense Comparison (Q4 2024 vs. Q4 2023) | Metric | Q4 2024 (in thousands) | Q4 2023 (in thousands) | Change (in thousands) | % Change | | :--- | :--- | :--- | :--- | :--- | | Total salaries and benefits expense | $35,326 | $34,055 | $1,271 | 3.7% | | Other miscellaneous expense | $4,611 | $6,656 | ($2,045) | (30.7)% | | Total non-interest expense | $59,775 | $60,267 | ($492) | (0.8)% | - For the full year 2024, total non-interest expense increased by only **0.4%**, as a **$4.8 million** (**3.5%**) rise in salaries and benefits and a **$2.0 million** (**10.7%**) increase in data processing/software costs were largely offset by a **$2.0 million** decline in intangible amortization and a **$0.8 million** reduction in operational losses[43](index=43&type=chunk) [Provision for Income Taxes](index=13&type=section&id=Provision%20for%20Income%20Taxes) The company's effective tax rate was **25.3%** for Q4 2024, down from **26.3%** in the prior quarter, and **25.9%** for the full year 2024, a decrease from **28.4%** in 2023, remaining below the blended statutory rate of **29.6%** due to non-taxable revenues and tax credits - The effective tax rate was **25.3%** for Q4 2024 and **25.9%** for the full year 2024, which is lower than the blended statutory rate of approximately **29.6%** due to non-taxable revenues and tax credits[44](index=44&type=chunk) [Supplementary Information](index=15&type=section&id=Supplementary%20Information) This section provides essential background on TriCo Bancshares and its forward-looking statements, along with detailed unaudited financial data and non-GAAP reconciliations [About TriCo Bancshares & Forward-Looking Statements](index=15&type=section&id=About%20TriCo%20Bancshares%20%26%20Forward-Looking%20Statements) This section provides a corporate overview of TriCo Bancshares and its subsidiary, Tri Counties Bank, highlighting its history since 1975 and its range of banking services across California, alongside a standard forward-looking statements disclaimer outlining numerous risks that could cause actual results to differ from expectations - TriCo Bancshares, established in **1975** and headquartered in Chico, California, operates through its subsidiary Tri Counties Bank, offering a wide range of consumer, small business, and commercial banking services throughout California[47](index=47&type=chunk) - Key risks identified include economic conditions, interest rate policies of the Federal Reserve, inflation, regulatory changes, credit quality of the loan portfolio, cybersecurity incidents, and competition from traditional and non-traditional financial companies[48](index=48&type=chunk) [Condensed Consolidated Financial Data (Unaudited)](index=16&type=section&id=Condensed%20Consolidated%20Financial%20Data%20(Unaudited)) This section provides detailed unaudited financial tables for the past five quarters, including income statement data, per-share metrics, credit quality indicators, key financial ratios, and quarter-end balance sheet figures, offering a granular, comparative view of the company's performance and financial position over time Quarterly Financial Summary (Last 5 Quarters) | Metric | Q4 2024 (in millions) | Q3 2024 (in millions) | Q2 2024 (in millions) | Q1 2024 (in millions) | Q4 2023 (in millions) | | :--- | :--- | :--- | :--- | :--- | :--- | | **Income Statement** | | | | | | | Net Interest Income | $84.09 | $82.611 | $81.997 | $82.736 | $86.617 | | Net Income | $29.034 | $29.051 | $29.034 | $27.749 | $26.075 | | Diluted EPS | $0.88 | $0.88 | $0.87 | $0.83 | $0.78 | | **Balance Sheet (End of Period)** | | | | | | | Total Assets (in billions) | $9.674 | $9.824 | $9.741 | $9.814 | $9.91 | | Total Loans, Gross (in billions) | $6.769 | $6.684 | $6.743 | $6.801 | $6.794 | | Total Deposits (in billions) | $8.088 | $8.037 | $8.05 | $7.988 | $7.834 | | Total Shareholders' Equity (in billions) | $1.221 | $1.239 | $1.175 | $1.163 | $1.16 | | **Key Ratios** | | | | | | | Return on Average Assets | 1.19% | 1.20% | 1.19% | 1.13% | 1.05% | | Net Interest Margin (FTE) | 3.76% | 3.71% | 3.68% | 3.68% | 3.81% | | Efficiency Ratio | 59.56% | 60.02% | 59.61% | 57.36% | 58.71% | | ACL to Gross Loans | 1.85% | 1.85% | 1.83% | 1.83% | 1.79% | [Non-GAAP Financial Measures (Unaudited)](index=18&type=section&id=Non-GAAP%20Financial%20Measures%20(Unaudited)) This section reconciles GAAP to non-GAAP financial measures to provide what management believes is a clearer assessment of core operational trends, with key non-GAAP metrics including tangible book value per share of **$27.60** and return on average tangible common equity of **12.73%** for Q4 2024 Tangible Book Value Per Share Reconciliation (Non-GAAP) | Metric | Dec 31, 2024 (in thousands) | Sep 30, 2024 (in thousands) | Dec 31, 2023 (in thousands) | | :--- | :--- | :--- | :--- | | Shareholders' equity (GAAP) | $1,220,907 | $1,239,015 | $1,159,682 | | Less: Goodwill and other intangibles | $310,874 | $311,904 | $314,994 | | Tangible shareholders' equity (Non-GAAP) | $910,033 | $927,111 | $844,688 | | Common shares outstanding | 32,970,425 | 33,000,508 | 33,268,102 | | **Tangible book value per share (Non-GAAP)** | **$27.60** | **$28.09** | **$25.39** | Return on Average Tangible Common Equity (Non-GAAP) | Metric (annualized) | Q4 2024 | Q3 2024 | Q4 2023 | | :--- | :--- | :--- | :--- | | Return on average equity (GAAP) | 9.30% | 9.52% | 9.43% | | **Return on average tangible common equity (Non-GAAP)** | **12.73%** | **13.13%** | **13.67%** | - The net interest margin (FTE) of **3.76%** for Q4 2024 includes a **5 basis point** benefit from the accretion of discounts on acquired loans, with the core NIM being **3.71%** excluding this effect[51](index=51&type=chunk)