Peoples Financial Corporation — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net income for the third quarter of 2026 increased $473,000 to $1,116,000, compared to $643,000 in the third quarter of 2025.
• Earnings per weighted average common share were $0.24 for the third quarter of 2026, up from $0.14 in the prior-year period.
• Net interest income rose $560,000 to $5,136,000 in the third quarter of 2026, compared to $4,576,000 in the third quarter of 2025.
• Total interest income increased $327,000 to $7,237,000 in the third quarter of 2026, driven by higher interest income on loans.
• Total interest expense decreased $233,000 to $2,101,000 in the third quarter of 2026, down from $2,334,000 in the third quarter of 2025, due to lower rates and balances on Federal Home Loan Bank borrowings and reduced interest expense on deposit accounts.
• Net income for the first nine months of 2026 increased $264,000 to $3,459,000, compared to $3,195,000 for the first nine months of 2025.
• Earnings per share for the first nine months of 2026 were $0.75, compared to $0.69 in the same period of 2025.
• Income tax expense decreased $413,000 to $350,000 for the first nine months of 2026, compared to $763,000 in 2025, primarily due to a $398,000 discrete tax benefit related to state net operating loss carryforward true-ups.
• Return on average assets for the first nine months of 2026 increased 0.07% to 0.61%, compared to 0.54% in 2025.
• The efficiency ratio increased 1% to 82% for the first nine months of 2026, compared to 81% in 2025.
• Net interest margin was 2.98% as of September 30, 2026, compared to 2.92% in 2025.
• Return on average equity was 4.65% as of September 30, 2026, compared to 4.50% in 2025.
• Non-interest income for the third quarter of 2026 was $1,885,000, down from $1,928,000 in 2025.
• Non-interest expense for the third quarter of 2026 was $6,032,000, up from $5,718,000 in 2025.
• Provision for credit losses was $42,000 for the third quarter of 2026, compared to $0 in 2025.

Guidance and Future Outlook:

• Management expects to offset lower securities income by reinvesting maturing securities at higher yields and through continued loan growth.
• The Company does not foresee a sale of affected securities that would cause the realization of unrealized losses in net income in the near future.

Business Segments and Product Lines:

• Significant loan growth occurred during the nine months ended September 30, 2026, reflecting the strength of markets and the effectiveness of the lending team.
• The Bank operates 18 facilities along the Mississippi Gulf Coast in Hancock, Harrison, Jackson, and Stone counties.
• The Bank offers retail and commercial banking services, as well as trust and investment services including financial, estate, and retirement planning.

Market and Competitive Landscape:

• The majority of the Bank's deposits are fully FDIC insured.
• Total deposits increased $41,722,000 to $646,151,000 as of September 30, 2026, from $604,429,000 at December 31, 2025, primarily due to the addition of public fund deposits during the third quarter of 2026.
• Total assets were $775,544,000 as of September 30, 2026, compared to $758,066,000 in 2025.
• Loans, net, increased to $292,828,000 as of September 30, 2026, from $249,737,000 in 2025.
• Securities portfolio value was $408,463,000 as of September 30, 2026, compared to $407,913,000 in 2025.

Risks and Challenges:

• Rising interest rates adversely affected the fair value of investment securities, resulting in an increase of $5,053,000 in unrealized losses on the securities portfolio during 2026.
• Unrealized losses on the available-for-sale securities portfolio were $33,982,000 as of September 30, 2026, compared to $28,929,000 as of December 31, 2025.
• Total shareholders' equity decreased $2,425,000 to $98,242,000 at September 30, 2026, from $100,667,000 at December 31, 2025, due to unrealized losses and dividend payments.
• The Company monitors economic conditions closely, including interest-rate changes.
• Actual results may differ from forward-looking statements due to risk factors and uncertainties described in the Company's Annual Report on Form 10-K and other SEC filings.

Management Commentary and Tone:

• Chevis C. Swetman, Chairman and CEO, stated that the Bank's leadership remains committed to maintaining high asset quality.
• Management attributed significant loan growth to market strength, the effectiveness of the lending team, and the ability to expand earning assets while preserving credit quality.

Other Key Points:

• The Company announced a 5.6% increase in its regular semi-annual dividend from $0.18 to $0.19 per common share.
• The dividend is payable on November 13, 2026, to shareholders of record as of November 10, 2026.
• Dividends of $831,000 were paid to shareholders of record since June 8, 2026.
• The Bank's leverage ratio remained strong at 14.89% as of September 30, 2026, unaffected by unrealized losses due to a regulatory opt-out election.
• Allowance for credit losses on loans as a percentage of loans decreased to 1.06% as of September 30, 2026, from 1.16% in 2025.
• Nonaccrual loans decreased to $479,000 as of September 30, 2026, from $793,000 in 2025.
• Loans past due 90 days and still accruing decreased to $59,000 as of September 30, 2026, from $100,000 in 2025.
• Recoveries for the nine months ended September 30, 2026, were $267,000, compared to $111,000 in 2025.
• Charge-offs for the nine months ended September 30, 2026, were $126,000, compared to $175,000 in 2025.
• Book value per share was $21.28 as of September 30, 2026, compared to $21.66 in 2025.