Heritage Commerce Corp Reports Fourth Quarter and Full Year 2025 Financial Results

Realtime	Geld	Brief	Zeit
	10,900	12,100	13:26

Adjusted 4^th quarter earnings increased 62% year over year due to sustained balance-sheet growth, NIM expansion and positive operating leverage.

Announced strategic merger to expand market presence and enhance long-term growth opportunities.

SAN JOSE, Calif., Jan. 22, 2026 (GLOBE NEWSWIRE) -- Heritage Commerce Corp (Nasdaq: HTBK), (the "Company"), the holding company for Heritage Bank of Commerce (the "Bank") today announced its financial results for the fourth quarter and year ended December 31, 2025. All data are unaudited.

	Fourth Quarter 2025		Full Year 2025
FOURTH QUARTER AND FULL YEAR 2025 HIGHLIGHTS:	Reported	Adjusted⁽¹⁾	Reported	Adjusted⁽¹⁾
Net Income	$15.1 Million	$17.2 Million	$47.8 Million	$56.4 Million
Diluted Earnings Per Share ("EPS")	- 0.25	- 0.28	- 0.78	- 0.91
Return on Average Assets ("ROAA")	1.04-	1.18-	0.86-	1.01-
Return on Average Tangible Common Equity ("ROATCE")⁽¹⁾	11.29-	12.83-	9.12-	10.77-

Pre-Provision Net Revenue ("PPNR")⁽¹⁾	$22.6 Million	$24.6 Million	$69.6 Million	$80.9 Million
Fully Tax Equivalent ("FTE") Net Interest Margin⁽¹⁾	3.72-	3.72-	3.56-	3.56-
Efficiency Ratio	57.89-	54.04-	64.75-	59.05-

CEO COMMENTARY:

"The year 2025, and the fourth quarter in particular, was a consequential time for Heritage, and we are proud of the way our team worked to deliver solid growth and results, driven by steady performance across the business, sustained client momentum and strong credit quality. This quarter reflects strong execution across the organization. We delivered meaningful balance-sheet growth, expanded operating leverage through disciplined expense management, and increased adjusted full year earnings by 39%. Our focus on consistent performance and prudent growth continues to strengthen our foundation," said Clay Jones, President and Chief Executive Officer.

"The recently announced merger with Citizens Business Bank represents an exciting next step in Heritage's journey, building on the strength of our franchise and the consistent performance we delivered throughout 2025. As we work toward the completion of the transaction, we remain fully focused on executing our strategy and continuing to support our clients, colleagues, and communities."

LINKED-QUARTER BASIS	FULL YEAR 2025 vs. 2024

FINANCIAL HIGHLIGHTS / KEY PERFORMANCE METRICS:
Total revenue of $53.6 million, an increase of 7%, or $3.6 million FTE net interest margin⁽¹⁾ of 3.72%, an increase of 12 basis points from 3.60% Reported net income of $15.1 million and reported EPS of $0.25, up 3% and 4%, from $14.7 million and $0.24, respectively Adjusted net income⁽¹⁾ of $17.2 million and adjusted EPS⁽¹⁾ of $0.28, both up 17% from $14.7 million and $0.24, respectively Loans held-for-investment ("HFI") of $3.7 billion, up $71.4 million, or 2% Total deposits of $4.9 billion, up $126.5 million, or 3% Nonperforming assets ("NPAs") to total assets of 0.05%, compared to 0.07% Adjusted efficiency ratio⁽¹⁾ of 54.04%, a decrease of 7% from efficiency ratio of 58.05% Adjusted ROAA⁽¹⁾ of 1.18%, an increase of 12% over ROAA of 1.05% Adjusted ROATCE⁽¹⁾ of 12.83%, an increase of 15% over ROATCE⁽¹⁾of 11.14%	Total revenue of $197.5 million, an increase of 15%, or $25.1 million FTE net interest margin⁽¹⁾ of 3.56%, an increase of 31 basis points from 3.25% Reported net income of $47.8 million and reported EPS of $0.78, both up 18%, from $40.5 million and $0.66, respectively Adjusted net income⁽¹⁾ of $56.4 million and adjusted EPS⁽¹⁾ of $0.91, up 39% and 38%, from $40.5 million and $0.66, respectively Loans HFI of $3.7 billion, up $161.1 million, or 5% Total deposits of $4.9 billion, up $83.1 million, or 2% NPAs to total assets of 0.05%, compared to 0.14% Adjusted efficiency ratio⁽¹⁾ of 59.05%, a decrease of 10% from efficiency ratio of 65.88% Adjusted ROAA⁽¹⁾ of 1.01%, an increase of 33% over ROAA of 0.76% Adjusted ROATCE⁽¹⁾ of 10.77%, an increase of 34% over ROATCE⁽¹⁾of 8.05%

⁽¹⁾This is a non-GAAP financial measure as defined and discussed under "Non-GAAP Financial Measures" in this press release. All references to "adjusted" operating metrics exclude the $9.2 million of pre-tax charges primarily related to a legal settlement in the second quarter of 2025 and $2.1 million of pre-tax merger-related costs in the fourth quarter of 2025 as presented in the reconciliation of non-GAAP financial measures at the end of this press release.

About Heritage Commerce Corp

Heritage Commerce Corp, a bank holding company established in October 1997, is the parent company of Heritage Bank of Commerce, established in 1994 and headquartered in San Jose, CA with full-service branches in Danville, Fremont, Hollister, Livermore, Los Altos, Los Gatos, Morgan Hill, Oakland, Palo Alto, Pleasanton, Redwood City, San Francisco, San Jose, San Mateo, San Rafael, and Walnut Creek. Heritage Bank of Commerce is an SBA Preferred Lender. Bay View Funding, a subsidiary of Heritage Bank of Commerce, is based in San Jose, CA and provides business-essential working capital factoring financing to various industries throughout the United States. For more information, please visit www.heritagecommercecorp.com. The contents of our website are not incorporated into, and do not form a part of, this release or of our filings with the Securities and Exchange Commission.

Recent Merger Announcement

On December 17, 2025, CVB Financial Corp. (Nasdaq: CVBF; together with Citizens Business Bank, National Association, "Citizens") and Heritage Commerce Corp (Nasdaq: HTBK; together with Heritage Bank of Commerce, "Heritage"), jointly announced that they have entered into a definitive merger agreement. Under the terms of the agreement, Heritage will merge with and into Citizens in an all-stock transaction valued at approximately $811 million, or $13.00 per HTBK share, based on CVBF's closing stock price on December 16, 2025. The value of the transaction is based on a specified closing price and is subject to CVBF stock price fluctuations. Upon completion, the combination is expected to create a top-performing California business bank with approximately $22 billion in assets, more than 75 offices and branches, and a deeply rooted presence in the State's key economic centers. The proposed merger has been unanimously approved by the respective Boards of Directors of both companies and is expected to close in the second quarter of 2026, subject to customary regulatory approvals, Heritage and Citizens shareholder approvals, and other closing conditions. For more information, please refer to the Company's Current Report on Form 8-K filed with the Securities and Exchange Commission on December 17, 2025.

Reclassifications

During the first quarter of 2025, we reclassified Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") stock dividends from interest income to noninterest income and the related average asset balances were reclassified from interest earning assets to other assets on the "Net Interest Income and Net Interest Margin" tables. The amounts for the prior periods were reclassified to conform to the current presentation. These reclassifications did not affect previously reported net income or shareholders' equity.

Non-GAAP Financial Measures

Financial results are presented in accordance with accounting principles generally accepted in the United States of America ("GAAP") and prevailing practices in the banking industry. However, certain non-GAAP performance measures and ratios are used by management to evaluate and measure the Company's performance. These measures include "adjusted" operating metrics that have been adjusted to exclude notable expenses incurred in the second and fourth quarters of 2025 as well as other performance measures and ratios adjusted for notable items. Management believes these non-GAAP financial measures enhance comparability between periods and in some instances are common in the banking industry. These non-GAAP financial measures should be supplemental to primary GAAP financial measures and should not be read in isolation or relied upon as a substitute for primary GAAP financial measures. A reconciliation of GAAP to non-GAAP financial measures is presented in the tables at the end of this press release under "Reconciliation of Non-GAAP Financial Measures."

Forward-Looking Statement Disclaimer

Certain matters discussed in this press release constitute forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements are inherently uncertain in that they reflect plans and expectations for future events. These statements may include, among other things, those relating to the Company's future financial performance, plans and objectives regarding future events, expectations regarding changes in interest rates and market conditions, projected cash flows of our investment securities portfolio, the performance of our loan portfolio, loan growth, expenses, net interest margin, estimated net interest income resulting from a shift in interest rates, expectation of high credit quality issuers ability to repay, as well as statements relating to the anticipated effects on the Company's financial condition and results of operations from expected developments or events. Any statements that reflect our belief about, confidence in, or expectations for future events, performance or condition should be considered forward-looking statements. Readers should not construe these statements as assurances of a given level of performance, nor as promises that we will take actions that we currently expect to take. All statements are subject to various risks and uncertainties, many of which are outside our control and some of which may fall outside our ability to predict or anticipate. Accordingly, our actual results may differ materially from our projected results, and we may take actions or experience events that we do not currently expect. Risks and uncertainties that could cause our financial performance to differ materially from our goals, plans, expectations and projections expressed in forward-looking statements include those set forth in our filings with the Securities and Exchange Commission, Item 1A of the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, and include: (i) cybersecurity risks that may affect us directly or may impact us indirectly by virtue of their effects on our clients, markets or vendors, including our ability to identify and address cybersecurity risks, including those posed by the increasing use of artificial intelligence (such as, but not limited to, ransomware, data security breaches, "denial of service" attacks, "hacking" and identity theft) affecting us, our clients, and our third-party vendors and service providers; (ii) events that affect our ability to attract, recruit, and retain qualified officers and other personnel to implement our strategic plan, and that enable current and future personnel to protect and develop our relationships with clients, and to promote our business, results of operations and growth prospects; (iii) media items and consumer confidence as those factors affect our clients' confidence in the banking system generally and in our bank specifically; (iv) adequacy of our risk management framework, disclosure controls and procedures and internal control over financial reporting; (v) market, geographic and sociopolitical factors that arise by virtue of the fact that we operate primarily in the general San Francisco Bay Area of Northern California; (vi) risks of geographic concentration of our client base, our loans, and the collateral securing our loans, as those clients and assets may be particularly subject to natural disasters and to events and conditions that directly or indirectly affect those regions, including the particular risks of natural disasters (including earthquakes, fires, and flooding) and other events that disproportionately affect that region; (vii) political events that have accompanied or that may in the future accompany or result from recent political changes, particularly including the imposition of tariffs, sociopolitical events and conditions that result from political conflicts and law enforcement activities that may adversely affect our markets or our clients; (viii) our ability to estimate accurately, and to establish adequate reserves against, the risk of loss associated with our loan and lease portfolios and our factoring business; (ix) inflationary pressures and changes in the interest rate environment that reduce our margins and yields, the fair value of financial instruments or our level of loan originations, or increase the level of defaults, losses and prepayments on loans to clients, whether held in the portfolio or in the secondary market; (x) factors that affect the value and liquidity of our investment portfolios, particularly the values of securities available-for-sale; (xi) factors that affect our liquidity and our ability to meet client demands for withdrawals from deposit accounts and undrawn lines of credit, including our cash on hand and the availability of funds from our own lines of credit; (xii) increased capital requirements for our continual growth or as imposed by banking regulators, which may require us to raise capital at a time when capital is not available on favorable terms or at all; (xiii) the expense and uncertain resolution of litigation matters whether occurring in the ordinary course of business or otherwise, particularly including but not limited to the effects of recent and ongoing developments in California labor and employment laws, regulations and court decisions; (xiv) operational issues stemming from, and/or capital spending necessitated by, the potential need to adapt to industry changes in information technology systems, on which we are highly dependent; and (xv) our success in managing the risks involved in the foregoing factors. In addition, statements regarding the timing and impact of the closing of the proposed merger with Citizens are subject to risks and uncertainties. For more information on factors that could cause our expectations regarding the proposed merger with Citizens to differ, potentially materially, please refer to our Current Report on Form 8-K filed with the Securities and Exchange Commission on December 17, 2025.

Member FDIC

For additional information, email:
InvestorRelations@herbank.com

	For the Quarter Ended:									Percent Change From:				For the Year Ended:
CONSOLIDATED INCOME STATEMENTS	December 31,			September 30,			December 31,			September 30,		December 31,		December 31,			December 31,			Percent
(in $000's, unaudited)	2025			2025			2024			2025		2024		2025			2024			Change
Interest income	-	67,048		-	65,094		-	64,043		3	-	5	-	-	256,999		-	240,344		7	-
Interest expense		16,626			18,306			20,448		(9)	-	(19)	-		71,624			79,051		(9)	-
Net interest income before provision for credit losses on loans		50,422			46,788			43,595		8	-	16	-		185,375			161,293		15	-
Provision for credit losses on loans		610			416			1,331		47	-	(54)	-		1,816			2,139		(15)	-
Net interest income after provision for credit losses on loans		49,812			46,372			42,264		7	-	18	-		183,559			159,154		15	-
Noninterest income:
Service charges and fees on deposit accounts		969			898			885		8	-	9	-		3,688			3,561		4	-
FHLB and FRB stock dividends		592			587			590		1	-	0	-		2,353			2,355		0	-
Increase in cash surrender value of life insurance		563			564			528		0	-	7	-		2,213			2,097		6	-
Termination fees		121			-			18		N/A		572	-		435			177		146	-
Servicing income		82			77			77		6	-	6	-		302			365		(17)	-
Gain on sales of SBA loans		30			-			125		N/A		(76)	-		215			473		(55)	-
Gain on proceeds from company-owned life insurance		-			-			-		N/A		N/A			-			219		(100)	-
Other		842			1,091			552		(23)	-	53	-		2,883			1,856		55	-
Total noninterest income		3,199			3,217			2,775		(1)	-	15	-		12,089			11,103		9	-
Noninterest expense:
Salaries and employee benefits		16,787			16,948			16,976		(1)	-	(1)	-		66,537			63,952		4	-
Occupancy and equipment		2,357			2,528			2,495		(7)	-	(6)	-		9,944			10,226		-3	-
Professional fees		1,659			1,175			1,711		41	-	(3)	-		6,233			5,416		15	-
Other		10,239			8,375			9,122		22	-	12	-		45,145			33,989		33	-
Total noninterest expense		31,042			29,026			30,304		7	-	2	-		127,859			113,583		13	-
Income before income taxes		21,969			20,563			14,735		7	-	49	-		67,789			56,674		20	-
Income tax expense		6,852			5,865			4,114		17	-	67	-		19,959			16,146		24	-
Net income	-	15,117		-	14,698		-	10,621		3	-	42	-	-	47,830		-	40,528		18	-

PER COMMON SHARE DATA
(unaudited)
Basic earnings per share	-	0.25		-	0.24		-	0.17		4	-	47	-	-	0.78		-	0.66		18	-
Diluted earnings per share	-	0.25		-	0.24		-	0.17		4	-	47	-	-	0.78		-	0.66		18	-
Weighted average shares outstanding - basic		61,308,370			61,333,951			61,320,505		0	-	0	-		61,407,520			61,270,730		0	-
Weighted average shares outstanding - diluted		61,701,068			61,616,785			61,679,735		0	-	0	-		61,702,095			61,527,372		0	-
Common shares outstanding at period-end		61,368,708			61,277,541			61,348,095		0	-	0	-		61,368,708			61,348,095		0	-
Dividend per share	-	0.13		-	0.13		-	0.13		0	-	0	-	-	0.52		-	0.52		0	-
Book value per share	-	11.55		-	11.42		-	11.24		1	-	3	-	-	11.55		-	11.24		3	-
Tangible book value per share⁽¹⁾	-	8.74		-	8.61		-	8.41		2	-	4	-	-	8.74		-	8.41		4	-

KEY PERFORMANCE METRICS
(in $000's, unaudited)
Annualized return on average equity		8.52	-		8.37	-		6.16	-	2	-	38	-		6.86	-		5.97	-	15	-
Annualized return on average tangible common equity⁽¹⁾		11.29	-		11.14	-		8.25	-	1	-	37	-		9.12	-		8.05	-	13	-
Annualized return on average assets		1.04	-		1.05	-		0.75	-	(1)	-	39	-		0.86	-		0.76	-	13	-
Annualized return on average tangible assets⁽¹⁾		1.07	-		1.08	-		0.78	-	(1)	-	37	-		0.88	-		0.78	-	13	-
Net interest margin (FTE)⁽¹⁾		3.72	-		3.60	-		3.32	-	3	-	12	-		3.56	-		3.25	-	10	-
Total revenue	-	53,621		-	50,005		-	46,370		7	-	16	-	-	197,464		-	172,396		15	-
Pre-provision net revenue	-	22,579		-	20,979		-	16,066		8	-	41	-	-	69,605		-	58,813		18	-
Efficiency ratio		57.89	-		58.05	-		65.35	-	0	-	(11)	-		64.75	-		65.88	-	(2)	-

AVERAGE BALANCES
(in $000's, unaudited)
Average assets	-	5,764,240		-	5,551,457		-	5,607,840		4	-	3	-	-	5,583,975		-	5,338,705		5	-
Average tangible assets⁽¹⁾	-	5,591,718		-	5,378,468		-	5,433,439		4	-	3	-	-	5,410,766		-	5,163,485		5	-
Average earning assets	-	5,386,230		-	5,167,710		-	5,235,986		4	-	3	-	-	5,207,770		-	4,967,582		5	-
Average loans held-for-sale	-	1,395		-	1,230		-	2,260		13	-	(38)	-	-	1,787		-	2,001		(11)	-
Average loans held-for-investment	-	3,564,243		-	3,519,775		-	3,388,729		1	-	5	-	-	3,504,800		-	3,343,661		5	-
Average deposits	-	4,895,841		-	4,687,294		-	4,771,491		4	-	3	-	-	4,730,037		-	4,513,774		5	-
Average demand deposits - noninterest-bearing	-	1,288,941		-	1,187,357		-	1,222,393		9	-	5	-	-	1,197,836		-	1,174,854		2	-
Average interest-bearing deposits	-	3,606,900		-	3,499,937		-	3,549,098		3	-	2	-	-	3,532,201		-	3,338,920		6	-
Average interest-bearing liabilities	-	3,646,701		-	3,539,706		-	3,588,755		3	-	2	-	-	3,571,946		-	3,378,516		6	-
Average equity	-	703,611		-	696,385		-	686,263		1	-	3	-	-	697,463		-	678,543		3	-
Average tangible common equity⁽¹⁾	-	531,089		-	523,396		-	511,862		1	-	4	-	-	524,254		-	503,323		4	-

__________________________________
⁽¹⁾This is a non-GAAP financial measure as defined and discussed under "Non-GAAP Financial Measures" in this press release.

	For the Quarter Ended:
CONSOLIDATED INCOME STATEMENTS	December 31,			September 30,			June 30,			March 31,			December 31,
(in $000's, unaudited)	2025			2025			2025			2025			2024
Interest income	-	67,048		-	65,094		-	63,025		-	61,832		-	64,043
Interest expense		16,626			18,306			18,220			18,472			20,448
Net interest income before provision for credit losses on loans		50,422			46,788			44,805			43,360			43,595
Provision for credit losses on loans		610			416			516			274			1,331
Net interest income after provision for credit losses on loans		49,812			46,372			44,289			43,086			42,264
Noninterest income:
Service charges and fees on deposit accounts		969			898			929			892			885
FHLB and FRB stock dividends		592			587			584			590			590
Increase in cash surrender value of life insurance		563			564			548			538			528
Termination fees		121			-			227			87			18
Servicing income		82			77			87			98			77
Gain on sales of SBA loans		30			-			61			82			125
Other		842			1,091			541			409			552
Total noninterest income		3,199			3,217			2,977			2,696			2,775
Noninterest expense:
Salaries and employee benefits		16,787			16,948			16,227			16,575			16,976
Occupancy and equipment		2,357			2,528			2,525			2,534			2,495
Professional fees		1,659			1,175			1,819			1,580			1,711
Other		10,239			8,375			17,764			8,767			9,122
Total noninterest expense		31,042			29,026			38,335			29,456			30,304
Income before income taxes		21,969			20,563			8,931			16,326			14,735
Income tax expense		6,852			5,865			2,542			4,700			4,114
Net income	-	15,117		-	14,698		-	6,389		-	11,626		-	10,621

PER COMMON SHARE DATA
(unaudited)
Basic earnings per share	-	0.25		-	0.24		-	0.10		-	0.19		-	0.17
Diluted earnings per share	-	0.25		-	0.24		-	0.10		-	0.19		-	0.17
Weighted average shares outstanding - basic		61,308,370			61,333,951			61,508,180			61,479,579			61,320,505
Weighted average shares outstanding - diluted		61,701,068			61,616,785			61,624,600			61,708,361			61,679,735
Common shares outstanding at period-end		61,368,708			61,277,541			61,446,763			61,611,121			61,348,095
Dividend per share	-	0.13		-	0.13		-	0.13		-	0.13		-	0.13
Book value per share	-	11.55		-	11.42		-	11.31		-	11.30		-	11.24
Tangible book value per share⁽¹⁾	-	8.74		-	8.61		-	8.49		-	8.48		-	8.41

KEY PERFORMANCE METRICS
(in $000's, unaudited)
Annualized return on average equity		8.52	-		8.37	-		3.68	-		6.81	-		6.16	-
Annualized return on average tangible common equity⁽¹⁾		11.29	-		11.14	-		4.89	-		9.09	-		8.25	-
Annualized return on average assets		1.04	-		1.05	-		0.47	-		0.85	-		0.75	-
Annualized return on average tangible assets⁽¹⁾		1.07	-		1.08	-		0.48	-		0.88	-		0.78	-
Net interest margin (FTE)⁽¹⁾		3.72	-		3.60	-		3.54	-		3.39	-		3.32	-
Total revenue	-	53,621		-	50,005		-	47,782		-	46,056		-	46,370
Pre-provision net revenue	-	22,579		-	20,979		-	9,447		-	16,600		-	16,066
Efficiency ratio		57.89	-		58.05	-		80.23	-		63.96	-		65.35	-

AVERAGE BALANCES
(in $000's, unaudited)
Average assets	-	5,764,240		-	5,551,457		-	5,458,420		-	5,559,896		-	5,607,840
Average tangible assets⁽¹⁾	-	5,591,718		-	5,378,468		-	5,284,972		-	5,386,001		-	5,433,439
Average earning assets	-	5,386,230		-	5,167,710		-	5,087,089		-	5,188,317		-	5,235,986
Average loans held-for-sale	-	1,395		-	1,230		-	2,250		-	2,290		-	2,260
Average loans held-for-investment	-	3,564,243		-	3,519,775		-	3,504,518		-	3,429,014		-	3,388,729
Average deposits	-	4,895,841		-	4,687,294		-	4,618,007		-	4,717,517		-	4,771,491
Average demand deposits - noninterest-bearing	-	1,288,941		-	1,187,357		-	1,146,494		-	1,167,330		-	1,222,393
Average interest-bearing deposits	-	3,606,900		-	3,499,937		-	3,471,513		-	3,550,187		-	3,549,098
Average interest-bearing liabilities	-	3,646,701		-	3,539,706		-	3,511,237		-	3,589,872		-	3,588,755
Average equity	-	703,611		-	696,385		-	697,016		-	692,733		-	686,263
Average tangible common equity⁽¹⁾	-	531,089		-	523,396		-	523,568		-	518,838		-	511,862

__________________________________
⁽¹⁾This is a non-GAAP financial measure as defined and discussed under "Non-GAAP Financial Measures" in this press release.

	End of Period:									Percent Change From:
CONSOLIDATED BALANCE SHEETS	December 31,			September 30,			December 31,			September 30,		December 31,
(in $000's, unaudited)	2025			2025			2024			2025		2024
ASSETS
Cash and due from banks	-	21,682		-	42,442		-	29,864		(49)	-	(27)	-
Other investments and interest-bearing deposits in other financial institutions		625,346			705,300			938,259		(11)	-	(33)	-
Securities available-for-sale, at fair value		592,958			408,456			256,274		45	-	131	-
Securities held-to-maturity, at amortized cost		529,711			544,806			590,016		(3)	-	(10)	-
Loans - held-for-sale - SBA, including deferred costs		1,322			1,325			2,375		0	-	(44)	-
Loans - held-for-investment:
Commercial		550,362			523,110			531,350		5	-	4	-
Real estate:
CRE - owner occupied		623,293			629,855			601,636		(1)	-	4	-
CRE - non-owner occupied		1,475,061			1,416,987			1,341,266		4	-	10	-
Land and construction		133,558			137,170			127,848		(3)	-	4	-
Home equity		126,085			125,742			127,963		0	-	(1)	-
Multifamily		295,602			290,077			275,490		2	-	7	-
Residential mortgages		432,241			443,143			471,730		(2)	-	(8)	-
Consumer and other		17,366			15,938			14,837		9	-	17	-
Loans		3,653,568			3,582,022			3,492,120		2	-	5	-
Deferred loan fees, net		(508	-		(344	-		(183	-	48	-	178	-
Total loans - held-for-investment, net of deferred fees		3,653,060			3,581,678			3,491,937		2	-	5	-
Allowance for credit losses on loans		(49,999	-		(49,427	-		(48,953	-	1	-	2	-
Loans, net		3,603,061			3,532,251			3,442,984		2	-	5	-
Company-owned life insurance		83,423			82,861			81,211		1	-	3	-
Premises and equipment, net		9,213			9,429			10,140		(2)	-	(9)	-
Goodwill		167,631			167,631			167,631		0	-	0	-
Other intangible assets		4,625			5,078			6,439		(9)	-	(28)	-
Accrued interest receivable and other assets		125,725			124,141			119,813		1	-	5	-
Total assets	-	5,764,697		-	5,623,720		-	5,645,006		3	-	2	-

LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits:
Demand, noninterest-bearing	-	1,308,737		-	1,241,603		-	1,214,192		5	-	8	-
Demand, interest-bearing		957,146			922,077			936,587		4	-	2	-
Savings and money market		1,380,666			1,366,905			1,325,923		1	-	4	-
Time deposits - under $250		31,500			32,462			38,988		(3)	-	(19)	-
Time deposits - $250 and over		220,715			223,496			206,755		(1)	-	7	-
Insured Cash Sweep ("ICS")/Certificates of Deposit Account Registry Service ("CDARS") - interest-bearing demand, money market and time deposits		1,004,322			990,003			1,097,586		1	-	(8)	-
Total deposits		4,903,086			4,776,546			4,820,031		3	-	2	-
Subordinated debt, net of issuance costs		39,805			39,767			39,653		0	-	0	-
Accrued interest payable and other liabilities		113,240			107,397			95,595		5	-	18	-
Total liabilities		5,056,131			4,923,710			4,955,279		3	-	2	-

Shareholders' Equity:
Common stock		509,611			508,664			510,070		0	-	0	-
Retained earnings		203,675			196,526			187,762		4	-	8	-
Accumulated other comprehensive loss		(4,720	-		(5,180	-		(8,105	-	(9)	-	(42)	-
Total shareholders' equity		708,566			700,010			689,727		1	-	3	-
Total liabilities and shareholders' equity	-	5,764,697		-	5,623,720		-	5,645,006		3	-	2	-

	End of Period:
CONSOLIDATED BALANCE SHEETS	December 31,			September 30,			June 30,			March 31,			December 31,
(in $000's, unaudited)	2025			2025			2025			2025			2024
ASSETS
Cash and due from banks	-	21,682		-	42,442		-	55,360		-	44,281		-	29,864
Other investments and interest-bearing deposits in other financial institutions		625,346			705,300			666,432			700,769			938,259
Securities available-for-sale, at fair value		592,958			408,456			307,035			370,976			256,274
Securities held-to-maturity, at amortized cost		529,711			544,806			561,205			576,718			590,016
Loans - held-for-sale - SBA, including deferred costs		1,322			1,325			1,156			1,884			2,375
Loans - held-for-investment:
Commercial		550,362			523,110			492,231			489,241			531,350
Real estate:
CRE - owner occupied		623,293			629,855			627,810			616,825			601,636
CRE - non-owner occupied		1,475,061			1,416,987			1,390,419			1,363,275			1,341,266
Land and construction		133,558			137,170			149,460			136,106			127,848
Home equity		126,085			125,742			120,763			119,138			127,963
Multifamily		295,602			290,077			285,016			284,510			275,490
Residential mortgages		432,241			443,143			454,419			465,330			471,730
Consumer and other		17,366			15,938			14,661			12,741			14,837
Loans		3,653,568			3,582,022			3,534,779			3,487,166			3,492,120
Deferred loan fees, net		(508	-		(344	-		(446	-		(268	-		(183	-
Total loans - held-for-investment, net of deferred fees		3,653,060			3,581,678			3,534,333			3,486,898			3,491,937
Allowance for credit losses on loans		(49,999	-		(49,427	-		(48,633	-		(48,262	-		(48,953	-
Loans, net		3,603,061			3,532,251			3,485,700			3,438,636			3,442,984
Company-owned life insurance		83,423			82,861			82,296			81,749			81,211
Premises and equipment, net		9,213			9,429			9,765			9,772			10,140
Goodwill		167,631			167,631			167,631			167,631			167,631
Other intangible assets		4,625			5,078			5,532			5,986			6,439
Accrued interest receivable and other assets		125,725			124,141			125,125			115,853			119,813
Total assets	-	5,764,697		-	5,623,720		-	5,467,237		-	5,514,255		-	5,645,006

LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits:
Demand, noninterest-bearing	-	1,308,737		-	1,241,603		-	1,151,242		-	1,128,593		-	1,214,192
Demand, interest-bearing		957,146			922,077			955,504			949,068			936,587
Savings and money market		1,380,666			1,366,905			1,320,142			1,353,293			1,325,923
Time deposits - under $250		31,500			32,462			35,356			37,592			38,988
Time deposits - $250 and over		220,715			223,496			210,818			213,357			206,755
ICS/CDARS - interest-bearing demand, money market and time deposits		1,004,322			990,003			954,272			1,001,365			1,097,586
Total deposits		4,903,086			4,776,546			4,627,334			4,683,268			4,820,031
Subordinated debt, net of issuance costs		39,805			39,767			39,728			39,691			39,653
Accrued interest payable and other liabilities		113,240			107,397			105,471			95,106			95,595
Total liabilities		5,056,131			4,923,710			4,772,533			4,818,065			4,955,279

Shareholders' Equity:
Common stock		509,611			508,664			509,888			511,596			510,070
Retained earnings		203,675			196,526			189,794			191,401			187,762
Accumulated other comprehensive loss		(4,720	-		(5,180	-		(4,978	-		(6,807	-		(8,105	-
Total shareholders' equity		708,566			700,010			694,704			696,190			689,727
Total liabilities and shareholders' equity	-	5,764,697		-	5,623,720		-	5,467,237		-	5,514,255		-	5,645,006

	At or For the Quarter Ended:									Percent Change From:
ASSET QUALITY DATA	December 31,			September 30,			December 31,			September 30,		December 31,
(in $000's, unaudited)	2025			2025			2024			2025		2024
Nonaccrual loans - held-for-investment:
Land and construction loans	-	1,663		-	2,346		-	5,874		(29)	-	(72)	-
Commercial loans		354			467			-		(24)	-	N/A
Commercial real estate ("CRE")		31			-			1,014		N/A		(97)	-
Home equity		-			655			290		(100)	-	(100)	-
Total nonaccrual loans - held-for-investment:		2,048			3,468			7,178		(41)	-	(71)	-
Loans over 90 days past due and still accruing		735			194			489		279	-	50	-
Total nonperforming loans		2,783			3,662			7,667		(24)	-	(64)	-
Foreclosed assets		-			-			-		N/A		N/A
Total nonperforming assets	-	2,783		-	3,662		-	7,667		(24)	-	(64)	-
Net charge-offs (recoveries) during the quarter	-	38		-	(378	-	-	197		(110)	-	(81)	-
Provision for credit losses on loans during the quarter	-	610		-	416		-	1,331		47	-	(54)	-
Allowance for credit losses on loans	-	49,999		-	49,427		-	48,953		1	-	2	-
Classified assets	-	29,223		-	34,633		-	41,661		(16)	-	(30)	-
Allowance for credit losses on loans to total loans		1.37	-		1.38	-		1.40	-	(1)	-	(2)	-
Allowance for credit losses on loans to total nonperforming loans		1,796.59	-		1,349.73	-		638.49	-	33	-	181	-
Nonperforming assets to total assets		0.05	-		0.07	-		0.14	-	(29)	-	(64)	-
Nonperforming loans to total loans		0.08	-		0.10	-		0.22	-	(20)	-	(64)	-
Classified assets to total assets		0.51	-		0.62	-		0.74	-	(18)	-	(31)	-
Classified assets to Heritage Commerce Corp
Tier 1 capital plus allowance for credit losses on loans		5	-		6	-		7	-	(17)	-	(29)	-
Classified assets to Heritage Bank of Commerce
Tier 1 capital plus allowance for credit losses on loans		5	-		6	-		7	-	(17)	-	(29)	-

OTHER PERIOD-END STATISTICS
(in $000's, unaudited)
Heritage Commerce Corp:
Tangible common equity ⁽¹⁾	-	536,310		-	527,301		-	515,657		2	-	4	-
Shareholders' equity / total assets		12.29	-		12.45	-		12.22	-	(1)	-	1	-
Tangible common equity / tangible assets ⁽¹⁾		9.59	-		9.67	-		9.43	-	(1)	-	2	-
Loan to deposit ratio		74.51	-		74.99	-		72.45	-	(1)	-	3	-
Noninterest-bearing deposits / total deposits		26.69	-		25.99	-		25.19	-	3	-	6	-
Total capital	-	629,931		-	620,762		-	610,644		1	-	3	-
Tier 1 capital	-	539,394		-	530,835		-	524,204		2	-	3	-
Total capital ratio		15.1	-		15.4	-		15.6	-	(2)	-	(3)	-
Tier 1 capital ratio		12.9	-		13.2	-		13.4	-	(2)	-	(4)	-
Common Equity Tier 1 capital ratio		12.9	-		13.2	-		13.4	-	(2)	-	(4)	-
Tier 1 leverage ratio		9.6	-		9.9	-		9.6	-	(3)	-	0	-
Heritage Bank of Commerce:
Tangible common equity / tangible assets ⁽¹⁾		10.05	-		10.13	-		9.79	-	(1)	-	3	-
Total capital ratio		14.8	-		15.1	-		15.1	-	(2)	-	(2)	-
Tier 1 capital ratio		13.6	-		13.8	-		13.9	-	(1)	-	(2)	-
Common Equity Tier 1 capital ratio		13.6	-		13.8	-		13.9	-	(1)	-	(2)	-
Tier 1 leverage ratio		10.1	-		10.3	-		10.0	-	(2)	-	1	-

__________________________________
⁽¹⁾This is a non-GAAP financial measure as defined and discussed under "Non-GAAP Financial Measures" in this press release.

	At or For the Quarter Ended:
ASSET QUALITY DATA	December 31,			September 30,			June 30,			March 31,			December 31,
(in $000's, unaudited)	2025			2025			2025			2025			2024
Nonaccrual loans - held-for-investment:
Land and construction loans	-	1,663		-	2,346		-	4,198		-	4,793		-	5,874
Commercial loans		354			467			491			324			1,014
CRE		31			-			31			-			-
Home equity		-			655			728			927			290
Residential mortgages		-			-			607			-			-
Total nonaccrual loans - held-for-investment:		2,048			3,468			6,055			6,044			7,178
Loans over 90 days past due and still accruing		735			194			123			268			489
Total nonperforming loans		2,783			3,662			6,178			6,312			7,667
Foreclosed assets		-			-			-			-			-
Total nonperforming assets	-	2,783		-	3,662		-	6,178		-	6,312		-	7,667
Net charge-offs (recoveries) during the quarter	-	38		-	(378	-	-	145		-	965		-	197
Provision for credit losses on loans during the quarter	-	610		-	416		-	516		-	274		-	1,331
Allowance for credit losses on loans	-	49,999		-	49,427		-	48,633		-	48,262		-	48,953
Classified assets	-	29,223		-	34,633		-	37,525		-	40,034		-	41,661
Allowance for credit losses on loans to total loans		1.37	-		1.38	-		1.38	-		1.38	-		1.40	-
Allowance for credit losses on loans to total nonperforming loans		1,796.59	-		1,349.73	-		787.20	-		764.61	-		638.49	-
Nonperforming assets to total assets		0.05	-		0.07	-		0.11	-		0.11	-		0.14	-
Nonperforming loans to total loans		0.08	-		0.10	-		0.17	-		0.18	-		0.22	-
Classified assets to total assets		0.51	-		0.62	-		0.69	-		0.73	-		0.74	-
Classified assets to Heritage Commerce Corp
Tier 1 capital plus allowance for credit losses on loans		5	-		6	-		7	-		7	-		7	-
Classified assets to Heritage Bank of Commerce
Tier 1 capital plus allowance for credit losses on loans		5	-		6	-		6	-		7	-		7	-

OTHER PERIOD-END STATISTICS
(in $000's, unaudited)
Heritage Commerce Corp:
Tangible common equity ⁽¹⁾	-	536,310		-	527,301		-	521,541		-	522,573		-	515,657
Shareholders' equity / total assets		12.29	-		12.45	-		12.71	-		12.63	-		12.22	-
Tangible common equity / tangible assets ⁽¹⁾		9.59	-		9.67	-		9.85	-		9.78	-		9.43	-
Loan to deposit ratio		74.51	-		74.99	-		76.38	-		74.45	-		72.45	-
Noninterest-bearing deposits / total deposits		26.69	-		25.99	-		24.88	-		24.10	-		25.19	-
Total capital	-	629,931		-	620,762		-	613,956		-	615,774		-	610,644
Tier 1 capital	-	539,394		-	530,835		-	524,826		-	527,666		-	524,204
Total capital ratio		15.1	-		15.4	-		15.5	-		15.9	-		15.6	-
Tier 1 capital ratio		12.9	-		13.2	-		13.3	-		13.6	-		13.4	-
Common Equity Tier 1 capital ratio		12.9	-		13.2	-		13.3	-		13.6	-		13.4	-
Tier 1 leverage ratio		9.6	-		9.9	-		9.9	-		9.8	-		9.6	-
Heritage Bank of Commerce:
Tangible common equity / tangible assets ⁽¹⁾		10.05	-		10.13	-		10.28	-		10.15	-		9.79	-
Total capital ratio		14.8	-		15.1	-		15.1	-		15.4	-		15.1	-
Tier 1 capital ratio		13.6	-		13.8	-		13.8	-		14.1	-		13.9	-
Common Equity Tier 1 capital ratio		13.6	-		13.8	-		13.8	-		14.1	-		13.9	-
Tier 1 leverage ratio		10.1	-		10.3	-		10.4	-		10.2	-		10.0	-

__________________________________
⁽¹⁾This is a non-GAAP financial measure as defined and discussed under "Non-GAAP Financial Measures" in this press release.

	For the Quarter Ended								For the Quarter Ended
	December 31, 2025								September 30, 2025
				Interest			Average					Interest			Average
NET INTEREST INCOME AND NET INTEREST MARGIN	Average			Income/			Yield/		Average			Income/			Yield/
(in $000's, unaudited)	Balance			Expense			Rate		Balance			Expense			Rate
Assets:
Loans, core bank	-	3,073,726		-	42,691		5.51	-	-	3,039,478		-	42,655		5.57	-
Prepayment fees		-			183		0.02	-		-			185		0.02	-
Bay View Funding factored receivables		94,023			4,310		18.19	-		74,353			3,654		19.50	-
Purchased residential mortgages		399,359			3,370		3.35	-		408,810			3,472		3.37	-
Loan fair value mark / accretion		(1,470	-		159		0.02	-		(1,636	-		164		0.02	-
Loans, gross⁽¹⁾⁽²⁾		3,565,638			50,713		5.64	-		3,521,005			50,130		5.65	-
Securities - taxable		1,021,124			8,400		3.26	-		842,998			6,146		2.89	-
Securities - exempt from Federal tax ⁽³⁾		27,735			248		3.55	-		28,683			256		3.54	-
Other investments and interest-bearing deposits in other financial institutions		771,733			7,740		3.98	-		775,024			8,615		4.41	-
Total interest earning assets⁽³⁾		5,386,230			67,101		4.94	-		5,167,710			65,147		5.00	-
Cash and due from banks		33,470								30,764
Premises and equipment, net		9,415								9,651
Goodwill and other intangible assets		172,522								172,989
Other assets		162,603								170,343
Total assets	-	5,764,240							-	5,551,457

Liabilities and shareholders' equity:
Deposits:
Demand, noninterest-bearing	-	1,288,941							-	1,187,357

Demand, interest-bearing		948,217			1,347		0.56	-		932,996			1,463		0.62	-
Savings and money market		1,388,430			7,595		2.17	-		1,340,419			8,452		2.50	-
Time deposits - under $100		9,743			33		1.34	-		10,620			40		1.49	-
Time deposits - $100 and over		243,693			2,015		3.28	-		233,145			1,977		3.36	-
ICS/CDARS - interest-bearing demand, money market and time deposits		1,016,817			5,097		1.99	-		982,757			5,837		2.36	-
Total interest-bearing deposits		3,606,900			16,087		1.77	-		3,499,937			17,769		2.01	-
Total deposits		4,895,841			16,087		1.30	-		4,687,294			17,769		1.50	-

Short-term borrowings		19			-		0.00	-		26			-		0.00	-
Subordinated debt, net of issuance costs		39,782			539		5.38	-		39,743			537		5.36	-
Total interest-bearing liabilities		3,646,701			16,626		1.81	-		3,539,706			18,306		2.05	-
Total interest-bearing liabilities and demand, noninterest-bearing / cost of funds		4,935,642			16,626		1.34	-		4,727,063			18,306		1.54	-
Other liabilities		124,987								128,009
Total liabilities		5,060,629								4,855,072
Shareholders' equity		703,611								696,385
Total liabilities and shareholders' equity	-	5,764,240							-	5,551,457

Net interest income / margin ⁽³⁾					50,475		3.72	-					46,841		3.60	-
Less tax equivalent adjustment⁽³⁾					(53	-							(53	-
Net interest income				-	50,422		3.71	-				-	46,788		3.59	-

__________________________________
¹⁾Includes loans held-for-sale. Nonaccrual loans are included in average balances.
⁽²⁾Yield amounts earned on loans include fees and costs. The accretion of net deferred loan fees into loan interest income was $222,000 for the fourth quarter of 2025, compared to $246,000 for the third quarter of 2025. Prepayment fees totaled $183,000 for the fourth quarter of 2025, compared to $185,000 for the third quarter of 2025.
⁽³⁾Reflects the FTE adjustment for Federal tax-exempt income based on a 21% tax rate. This is a non-GAAP financial measure as defined and discussed under "Non-GAAP Financial Measures" in this press release.

	For the Quarter Ended								For the Quarter Ended
	December 31, 2025								December 31, 2024
NET INTEREST INCOME AND NET INTEREST MARGIN				Interest			Average					Interest			Average
NET INTEREST INCOME AND NET INTEREST MARGIN	Average			Income/			Yield/		Average			Income/			Yield/
(in $000's, unaudited)	Balance			Expense			Rate		Balance			Expense			Rate
Assets:
Loans, core bank	-	3,073,726		-	42,691		5.51	-	-	2,899,347		-	39,852		5.47	-
Prepayment fees		-			183		0.02	-		-			35		0.00	-
Bay View Funding factored receivables		94,023			4,310		18.19	-		59,153			3,084		20.74	-
Purchased residential mortgages		399,359			3,370		3.35	-		434,846			3,732		3.41	-
Loan fair value mark / accretion		(1,470	-		159		0.02	-		(2,357	-		429		0.06	-
Loans, gross⁽¹⁾⁽²⁾		3,565,638			50,713		5.64	-		3,390,989			47,132		5.53	-
Securities - taxable		1,021,124			8,400		3.26	-		800,174			4,475		2.22	-
Securities - exempt from Federal tax ⁽³⁾		27,735			248		3.55	-		30,570			274		3.57	-
Other investments and interest-bearing deposits in other financial institutions		771,733			7,740		3.98	-		1,014,253			12,220		4.79	-
Total interest earning assets⁽³⁾		5,386,230			67,101		4.94	-		5,235,986			64,101		4.87	-
Cash and due from banks		33,470								32,569
Premises and equipment, net		9,415								10,301
Goodwill and other intangible assets		172,522								174,401
Other assets		162,603								154,583
Total assets	-	5,764,240							-	5,607,840

Liabilities and shareholders' equity:
Deposits:
Demand, noninterest-bearing	-	1,288,941							-	1,222,393

Demand, interest-bearing		948,217			1,347		0.56	-		906,581			1,452		0.64	-
Savings and money market		1,388,430			7,595		2.17	-		1,339,397			9,090		2.70	-
Time deposits - under $100		9,743			33		1.34	-		11,388			49		1.71	-
Time deposits - $100 and over		243,693			2,015		3.28	-		234,446			2,310		3.92	-
ICS/CDARS - interest-bearing demand, money market and time deposits		1,016,817			5,097		1.99	-		1,057,286			7,009		2.64	-
Total interest-bearing deposits		3,606,900			16,087		1.77	-		3,549,098			19,910		2.23	-
Total deposits		4,895,841			16,087		1.30	-		4,771,491			19,910		1.66	-

Short-term borrowings		19			-		0.00	-		28			-		0.00	-
Subordinated debt, net of issuance costs		39,782			539		5.38	-		39,629			538		5.40	-
Total interest-bearing liabilities		3,646,701			16,626		1.81	-		3,588,755			20,448		2.27	-
Total interest-bearing liabilities and demand, noninterest-bearing / cost of funds		4,935,642			16,626		1.34	-		4,811,148			20,448		1.69	-
Other liabilities		124,987								110,429
Total liabilities		5,060,629								4,921,577
Shareholders' equity		703,611								686,263
Total liabilities and shareholders' equity	-	5,764,240							-	5,607,840

Net interest income / margin ⁽³⁾					50,475		3.72	-					43,653		3.32	-
Less tax equivalent adjustment⁽³⁾					(53	-							(58	-
Net interest income				-	50,422		3.71	-				-	43,595		3.31	-

__________________________________
⁽¹⁾Includes loans held-for-sale. Nonaccrual loans are included in average balances.
⁽²⁾Yield amounts earned on loans include fees and costs. The accretion of net deferred loan fees into loan interest income was $222,000 for the fourth quarter of 2025, compared to $167,000 for the fourth quarter of 2024. Prepayment fees totaled $183,000 for the fourth quarter of 2025, compared to $35,000 for the fourth quarter of 2024.
⁽³⁾Reflects the FTE adjustment for Federal tax-exempt income based on a 21% tax rate. This is a non-GAAP financial measure as defined and discussed under "Non-GAAP Financial Measures" in this press release.

	For the Year Ended								For the Year Ended
	December 31, 2025								December 31, 2024
NET INTEREST INCOME AND NET INTEREST MARGIN				Interest			Average					Interest			Average
NET INTEREST INCOME AND NET INTEREST MARGIN	Average			Income/			Yield/		Average			Income/			Yield/
(in $000's, unaudited)	Balance			Expense			Rate		Balance			Expense			Rate
Assets:
Loans, core bank	-	3,020,109		-	166,842		5.52	-	-	2,848,206		-	155,690		5.47	-
Prepayment fees		-			1,065		0.04	-		-			117		0.00	-
Bay View Funding factored receivables		74,189			14,253		19.21	-		55,717			10,980		19.71	-
Purchased residential mortgages		414,010			13,987		3.38	-		444,476			15,038		3.38	-
Loan fair value mark / accretion		(1,721	-		676		0.02	-		(2,737	-		1,158		0.04	-
Loans, gross⁽¹⁾⁽²⁾		3,506,587			196,823		5.61	-		3,345,662			182,983		5.47	-
Securities - taxable		910,926			26,451		2.90	-		905,418			20,817		2.30	-
Securities - exempt from Federal tax ⁽³⁾		29,280			1,051		3.59	-		31,403			1,127		3.59	-
Other investments, interest-bearing deposits in other financial institutions and Federal funds sold		760,977			32,895		4.32	-		685,099			35,654		5.20	-
Total interest earning assets⁽³⁾		5,207,770			257,220		4.94	-		4,967,582			240,581		4.84	-
Cash and due from banks		31,788								33,156
Premises and equipment, net		9,756								10,252
Goodwill and other intangible assets		173,209								175,220
Other assets		161,452								152,495
Total assets	-	5,583,975							-	5,338,705

Liabilities and shareholders' equity:
Deposits:
Demand, noninterest-bearing	-	1,197,836							-	1,174,854

Demand, interest-bearing		943,845			5,732		0.61	-		916,466			6,439		0.70	-
Savings and money market		1,341,411			32,325		2.41	-		1,175,391			32,734		2.78	-
Time deposits - under $100		10,795			168		1.56	-		11,112			184		1.66	-
Time deposits - $100 and over		235,744			8,116		3.44	-		228,388			8,968		3.93	-
ICS/CDARS - interest-bearing demand, money market and time deposits		1,000,406			23,131		2.31	-		1,007,563			28,574		2.84	-
Total interest-bearing deposits		3,532,201			69,472		1.97	-		3,338,920			76,899		2.30	-
Total deposits		4,730,037			69,472		1.47	-		4,513,774			76,899		1.70	-

Short-term borrowings		20			-		0.00	-		24			-		0.00	-
Subordinated debt, net of issuance costs		39,725			2,152		5.42	-		39,572			2,152		5.44	-
Total interest-bearing liabilities		3,571,946			71,624		2.01	-		3,378,516			79,051		2.34	-
Total interest-bearing liabilities and demand, noninterest-bearing / cost of funds		4,769,782			71,624		1.50	-		4,553,370			79,051		1.74	-
Other liabilities		116,730								106,792
Total liabilities		4,886,512								4,660,162
Shareholders' equity		697,463								678,543
Total liabilities and shareholders' equity	-	5,583,975							-	5,338,705

Net interest income / margin ⁽³⁾					185,596		3.56	-					161,530		3.25	-
Less tax equivalent adjustment⁽³⁾					(221	-							(237	-
Net interest income				-	185,375		3.56	-				-	161,293		3.25	-

__________________________________
⁽¹⁾Includes loans held-for-sale. Nonaccrual loans are included in average balances.
⁽²⁾Yield amounts earned on loans include fees and costs. The accretion of net deferred loan fees into loan interest income was $935,000 for the year ended December 31, 2025, compared to $628,000 for the year ended December 31, 2024. Prepayment fees totaled $1,065,000 for the year ended December 31, 2025, compared to $117,000 for the year ended December 31, 2024.
⁽³⁾Reflects the FTE adjustment for Federal tax-exempt income based on a 21% tax rate. This is a non-GAAP financial measure as defined and discussed under "Non-GAAP Financial Measures" in this press release.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

Management considers adjusted net income and adjusted earnings per share, which exclude the $9.2 million of pre-tax charges primarily related to a legal settlement in the second quarter of 2025 and $2.1 million of pre-tax merger-related costs in the fourth quarter of 2025, for the year ended December 31, 2025, as a useful measurement of the Company's profitability compared to other periods presented.

During the second quarter of 2025, the Company recorded pre-tax expenses of $9.2 million included in the other noninterest expense on the Company's consolidated income statement, primarily due to charges related to the settlement of certain litigation matters, including the anticipated settlement of a previously disclosed class action and California Private Attorneys General Act ("PAGA") lawsuit that alleged the violation of certain California wage-and-hour and related laws and regulations, and charges related to the planned closure of a Bank branch. During the fourth quarter of 2025, the Company recorded pre-tax expenses of $2.1 million included in the other noninterest expense on the Company's consolidated income statement, primarily due to charges related to investment banker and legal fees resulting from the pending merger with CVBF. Certain merger-related costs are not tax deductible.

The following table summarizes components of net income and diluted earnings per share for the periods indicated:

NET INCOME AND	For the Quarter Ended:
DILUTED EARNINGS PER SHARE	December 31,			September 30,		June 30,			March 31,		December 31,
(in $000's, unaudited)	2025			2025		2025			2025		2024
Reported net income (GAAP)	-	15,117		-	14,698	-	6,389		-	11,626	-	10,621
Add: pre-tax legal settlement, merger and other charges		2,067			-		9,184			-		-
Less: related income taxes		(15	-		-		(2,618	-		-		-
Adjusted net income (non-GAAP)	-	17,169		-	14,698	-	12,955		-	11,626	-	10,621

Weighted average shares outstanding - diluted		61,701,068			61,616,785		61,624,600			61,708,361		61,679,735

Reported diluted earnings per share (GAAP)	-	0.25		-	0.24	-	0.10		-	0.19	-	0.17

Adjusted diluted earnings per share (non-GAAP)	-	0.28		-	0.24	-	0.21		-	0.19	-	0.17

NET INCOME AND	For the Year Ended:
DILUTED EARNINGS PER SHARE	December 31,			December 31,
(in $000's, except per share amounts, unaudited)	2025			2024
Reported net income (GAAP)	-	47,830		-	40,528
Add: pre-tax legal settlement, merger and other charges		11,251			-
Less: related income taxes		(2,633	-		-
Adjusted net income (non-GAAP)	-	56,448		-	40,528

Weighted average shares outstanding - diluted		61,702,095			61,527,372

Reported diluted earnings per share (GAAP)	-	0.78		-	0.66

Adjusted diluted earnings per share (non-GAAP)	-	0.91		-	0.66

Management considers tangible book value per share as a useful measurement of the Company's equity. The Company references the return on average tangible common equity and the return on average tangible assets as measurements of profitability.

The following table summarizes components of the tangible book value per share at the dates indicated:

	End of Period:
TANGIBLE BOOK VALUE PER SHARE	December 31,			September 30,			June 30,			March 31,			December 31,
(in $000's, unaudited)	2025			2025			2025			2025			2024
Capital components:
Total equity (GAAP)	-	708,566		-	700,010		-	694,704		-	696,190		-	689,727
Less: preferred stock		-			-			-			-			-
Total common equity		708,566			700,010			694,704			696,190			689,727
Less: goodwill		(167,631	-		(167,631	-		(167,631	-		(167,631	-		(167,631	-
Less: other intangible assets		(4,625	-		(5,078	-		(5,532	-		(5,986	-		(6,439	-
Reported tangible common equity (non-GAAP)		536,310			527,301			521,541			522,573			515,657
Add: pre-tax legal settlement, merger and other charges		11,251			9,184			9,184			-			-
Less: related income taxes		(2,633	-		(2,618	-		(2,618	-		-			-
Adjusted tangible common equity (non-GAAP)	-	544,928		-	533,867		-	528,107		-	522,573		-	515,657

Common shares outstanding at period-end		61,368,708			61,277,541			61,446,763			61,611,121			61,348,095
Reported tangible book value per share (non-GAAP)	-	8.74		-	8.61		-	8.49		-	8.48		-	8.41
Adjusted tangible book value per share (non-GAAP)	-	8.88		-	8.71		-	8.59		-	8.48		-	8.41

The following tables summarize components of the annualized return on average tangible common equity and the annualized return on average tangible assets for the periods indicated:

RETURN ON AVERAGE TANGIBLE COMMON EQUITY AND AVERAGE ASSETS	For the Quarter Ended:
	December 31,				September 30,				June 30,				March 31,				December 31,
(in $000's, unaudited)	2025				2025				2025				2025				2024
Reported net income (GAAP)	-	15,117			-	14,698			-	6,389			-	11,626			-	10,621
Add: pre-tax legal settlement, merger and other charges		2,067				-				9,184				-				-
Less: related income taxes		(15	-			-				(2,618	-			-				-
Adjusted net income (non-GAAP)	-	17,169			-	14,698			-	12,955			-	11,626			-	10,621

Average tangible common equity components:
Average equity (GAAP)	-	703,611			-	696,385			-	697,016			-	692,733			-	686,263
Less: goodwill		(167,631	-			(167,631	-			(167,631	-			(167,631	-			(167,631	-
Less: other intangible assets		(4,891	-			(5,358	-			(5,817	-			(6,264	-			(6,770	-
Total average tangible common equity (non-GAAP)	-	531,089			-	523,396			-	523,568			-	518,838			-	511,862

Reported annualized return on average equity (GAAP)		8.52		-		8.37		-		3.68		-		6.81		-		6.16		-
Adjusted annualized return on average equity (non-GAAP)		9.68		-		8.37		-		7.45		-		6.81		-		6.16		-

Reported annualized return on average tangible common equity (non-GAAP)		11.29		-		11.14		-		4.89		-		9.09		-		8.25		-
Adjusted annualized return on average tangible common equity (non-GAAP)		12.83		-		11.14		-		9.92		-		9.09		-		8.25		-

Average Assets (GAAP)	-	5,764,240			-	5,551,457			-	5,458,420			-	5,559,896			-	5,607,840

Reported annualized return on average assets (GAAP)		1.04		-		1.05		-		0.47		-		0.85		-		0.75		-
Adjusted annualized return on average assets (non-GAAP)		1.18		-		1.05		-		0.95		-		0.85		-		0.75		-

RETURN ON AVERAGE TANGIBLE COMMON	For the Year Ended:
EQUITY AND AVERAGE ASSETS	December 31,				December 31,
(in $000's, unaudited)	2025				2024
Reported net income (GAAP)	-	47,830			-	40,528
Add: pre-tax legal settlement, merger and other charges		11,251				-
Less: related income taxes		(2,633	-			-
Adjusted net income (non-GAAP)	-	56,448			-	40,528

Average tangible common equity components:
Average equity (GAAP)	-	697,463			-	678,543
Less: goodwill		(167,631	-			(167,631	-
Less: other intangible assets		(5,578	-			(7,589	-
Total average tangible common equity (non-GAAP)	-	524,254			-	503,323

Reported annualized return on average equity (GAAP)		6.86		-		5.97		-
Adjusted annualized return on average equity (non-GAAP)		8.09		-		5.97		-

Reported annualized return on average tangible common equity (non-GAAP)		9.12		-		8.05		-
Adjusted annualized return on average tangible common equity (non-GAAP)		10.77		-		8.05		-

Average Assets (GAAP)	-	5,583,975			-	5,338,705

Reported annualized return on average assets (GAAP)		0.86		-		0.76		-
Adjusted annualized return on average assets (non-GAAP)		1.01		-		0.76		-

Management reviews yields on certain asset categories and the net interest margin of the Company on an FTE basis. In this non-GAAP presentation, net interest income is adjusted to reflect tax-exempt interest income on an equivalent before-tax basis using tax rates effective as of the end of the period. This measure ensures comparability of net interest income arising from both taxable and tax-exempt sources. The following tables summarize components of FTE net interest income of the Company for the periods indicated:

NET INTEREST INCOME	For the Quarter Ended:
AND NET INTEREST MARGIN	December 31,			September 30,			June 30,			March 31,			December 31,
(in $000's, unaudited)	2025			2025			2025			2025			2024
Net interest income before credit losses on loans (GAAP)	-	50,422		-	46,788		-	44,805		-	43,360		-	43,595
Tax-equivalent adjustment on securities - exempt from Federal tax		53			53			57			58			58
Net interest income, FTE (non-GAAP)	-	50,475		-	46,841		-	44,862		-	43,418		-	43,653

Average balance of total interest earning assets	-	5,386,230		-	5,167,710		-	5,087,089		-	5,188,317		-	5,235,986

Net interest margin (annualized net interest income divided by the average balance of total interest earnings assets) (GAAP)		3.71	-		3.59	-		3.53	-		3.39	-		3.31	-

Net interest margin, FTE (annualized net interest income, FTE, divided by the average balance of total earnings assets) (non-GAAP)		3.72	-		3.60	-		3.54	-		3.39	-		3.32	-

NET INTEREST INCOME	For the Year Ended:
AND NET INTEREST MARGIN	December 31,			December 31,
(in $000's, unaudited)	2025			2024
Net interest income before credit losses on loans (GAAP)	-	185,375		-	161,293
Tax-equivalent adjustment on securities - exempt from Federal tax		221			237
Net interest income, FTE (non-GAAP)	-	185,596		-	161,530

Average balance of total interest earning assets	-	5,207,770		-	4,967,582

Net interest margin (annualized net interest income divided by the average balance of total interest earnings assets) (GAAP)		3.56	-		3.25	-

Net interest margin, FTE (annualized net interest income, FTE, divided by the average balance of total interest earnings assets) (non-GAAP)		3.56	-		3.25	-

Management views its PPNR as a key metric for assessing the Company's earnings power. The following table summarizes the components of PPNR for the periods indicated:

	For the Quarter Ended:
PRE-PROVISION NET REVENUE	December 31,			September 30,			June 30,			March 31,			December 31,
(in $000's, unaudited)	2025			2025			2025			2025			2024
Net interest income before credit losses on loans	-	50,422		-	46,788		-	44,805		-	43,360		-	43,595
Noninterest income		3,199			3,217			2,977			2,696			2,775
Total revenue		53,621			50,005			47,782			46,056			46,370
Less: Noninterest expense		(31,042	-		(29,026	-		(38,335	-		(29,456	-		(30,304	-
Reported PPNR		22,579			20,979			9,447			16,600			16,066
Add: pre-tax legal settlement, merger and other charges		2,067			-			9,184			-			-
Adjusted PPNR	-	24,646		-	20,979		-	18,631		-	16,600		-	16,066

	For the Year Ended:
PRE-PROVISION NET REVENUE	December 31,			December 31,
(in $000's, unaudited)	2025			2024
Net interest income before credit losses on loans	-	185,375		-	161,293
Noninterest income		12,089			11,103
Total revenue		197,464			172,396
Less: Noninterest expense		(127,859	-		(113,583	-
Reported PPNR		69,605			58,813
Add: pre-tax legal settlement, merger and other charges		11,251			-
Adjusted PPNR	-	80,856		-	58,813

The efficiency ratio, which is calculated by dividing noninterest expense by total revenue (net interest income plus noninterest income), measures how much it costs to produce one dollar of revenue. The following tables summarize components of the efficiency ratio of the Company for the periods indicated:

NONINTEREST EXPENSE AND	For the Quarter Ended:
EFFICIENCY RATIO	December 31,				September 30,			June 30,				March 31,			December 31,
(in $000's, unaudited)	2025				2025			2025				2025			2024
Reported noninterest expense (GAAP)	-	31,042			-	29,026		-	38,335			-	29,456		-	30,304
Add: pre-tax legal settlement, merger and other charges		(2,067	-			-			(9,184	-			-			-
Adjusted noninterest expense (non-GAAP)	-	28,975			-	29,026		-	29,151			-	29,456		-	30,304

Net interest income before credit losses on loans	-	50,422			-	46,788		-	44,805			-	43,360		-	43,595
Noninterest income		3,199				3,217			2,977				2,696			2,775
Total revenue	-	53,621			-	50,005		-	47,782			-	46,056		-	46,370

Reported efficiency ratio (noninterest expense divided by total revenue) (GAAP)		57.89		-		58.05	-		80.23		-		63.96	-		65.35	-

Adjusted efficiency ratio (adjusted noninterest expense divided by total revenue) (non-GAAP)		54.04		-		58.05	-		61.01		-		63.96	-		65.35	-

NONINTEREST EXPENSE AND	For the Year Ended:
EFFICIENCY RATIO	December 31,				December 31,
(in $000's, unaudited)	2025				2024
Reported noninterest expense (GAAP)	-	127,859			-	113,583
Add: pre-tax legal settlement, merger and other charges		(11,251	-			-
Adjusted noninterest expense (non-GAAP)	-	116,608			-	113,583

Net interest income before credit losses on loans	-	185,375			-	161,293
Noninterest income		12,089				11,103
Total revenue	-	197,464			-	172,396

Reported efficiency ratio (noninterest expense divided by total revenue) (GAAP)		64.75		-		65.88	-

Adjusted efficiency ratio (adjusted noninterest expense divided by total revenue) (non-GAAP)		59.05		-		65.88	-

Management considers the tangible common equity ratio as a useful measurement of the Company's and the Bank's equity. The following table summarizes components of the tangible common equity to tangible assets ratio of the Company at the dates indicated:

TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS	December 31,				September 30,				June 30,				March 31,				December 31,
(in $000's, unaudited)	2025				2025				2025				2025				2024
Heritage Commerce Corp:
Capital components:
Total equity (GAAP)	-	708,566			-	700,010			-	694,704			-	696,190			-	689,727
Less: preferred stock		-				-				-				-				-
Total common equity		708,566				700,010				694,704				696,190				689,727
Less: goodwill		(167,631	-			(167,631	-			(167,631	-			(167,631	-			(167,631	-
Less: other intangible assets		(4,625	-			(5,078	-			(5,532	-			(5,986	-			(6,439	-
Total tangible common equity (non-GAAP)	-	536,310			-	527,301			-	521,541			-	522,573			-	515,657

Asset components:
Total assets (GAAP)	-	5,764,697			-	5,623,720			-	5,467,237			-	5,514,255			-	5,645,006
Less: goodwill		(167,631	-			(167,631	-			(167,631	-			(167,631	-			(167,631	-
Less: other intangible assets		(4,625	-			(5,078	-			(5,532	-			(5,986	-			(6,439	-
Total tangible / assets (non-GAAP)	-	5,592,441			-	5,451,011			-	5,294,074			-	5,340,638			-	5,470,936

Tangible common equity / tangible assets (non-GAAP)		9.59		-		9.67		-		9.85		-		9.78		-		9.43		-

The following table summarizes components of the tangible common equity to tangible assets ratio of the Bank at the dates indicated:

TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS	December 31,				September 30,				June 30,				March 31,				December 31,
(in $000's, unaudited)	2025				2025				2025				2025				2024
Heritage Bank of Commerce:
Capital components:
Total equity (GAAP)	-	733,802			-	724,780			-	717,103			-	715,605			-	709,379
Less: preferred stock		-				-				-				-				-
Total common equity		733,802				724,780				717,103				715,605				709,379
Less: goodwill		(167,631	-			(167,631	-			(167,631	-			(167,631	-			(167,631	-
Less: other intangible assets		(4,625	-			(5,078	-			(5,532	-			(5,986	-			(6,439	-
Total tangible common equity (non-GAAP)	-	561,546			-	552,071			-	543,940			-	541,988			-	535,309

Asset components:
Total assets (GAAP)	-	5,760,786			-	5,620,681			-	5,464,618			-	5,512,160			-	5,641,646
Less: goodwill		(167,631	-			(167,631	-			(167,631	-			(167,631	-			(167,631	-
Less: other intangible assets		(4,625	-			(5,078	-			(5,532	-			(5,986	-			(6,439	-
Total tangible assets (non-GAAP)	-	5,588,530			-	5,447,972			-	5,291,455			-	5,338,543			-	5,467,576

Tangible common equity / tangible assets (non-GAAP)		10.05		-		10.13		-		10.28		-		10.15		-		9.79		-

Gold & Silber auf Rekordjagd

Kaum eine Entwicklung war 2025 so eindrucksvoll wie der Höhenflug der Edelmetalle. Allen voran Silber: Angetrieben von einem strukturellen Angebotsdefizit, explodierte der Preis und übertrumpfte dabei den „großen Bruder“ Gold. Die Nachfrage aus dem Investmentsektor zieht weiter an, und ein Preisziel von 100 US-Dollar rückt in greifbare Nähe.

Auch Gold markierte neue Meilensteine. Mit dem Durchbruch über 3.000 und 4.000 US-Dollar pro Unze hat sich der übergeordnete Aufwärtstrend eindrucksvoll bestätigt. Rücksetzer bleiben möglich, doch der nächste Zielbereich bei 5.000 US-Dollar ist charttechnisch fest im Blick. Die fundamentalen Treiber sind intakt, eine nachhaltige Trendwende aktuell nicht in Sicht.

Für Anlegerinnen und Anleger bedeutet das: Jetzt ist die Zeit, um gezielt auf starke Produzenten zu setzen. In unserem neuen Spezialreport stellen wir fünf Gold- und Silberaktien vor, die trotz Rallye weiter attraktives Potenzial bieten, mit robusten Fundamentaldaten und starken Projekten in aussichtsreichen Regionen.

Jetzt den kostenlosen Report sichern und von der nächsten Welle im Edelmetall-Boom profitieren!

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10:06	Heritage Commerce Non-GAAP EPS of $0.28, revenue of $53.6M
Do	Heritage Commerce declares quarterly dividend of $0.13 per share
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Do	Heritage Commerce Corp Reports Fourth Quarter and Full Year 2025 Financial Results	Adjusted 4th quarter earnings increased 62% year over year due to sustained balance-sheet growth, NIM expansion and positive operating leverage. Announced strategic merger to expand market presence... ► Artikel lesen

HERITAGE COMMERCE CORP

Heritage Commerce Corp Reports Fourth Quarter and Full Year 2025 Financial Results