Columbia Banking Systems COLB Q2 2026 earnings

CEO Commentary

| "Our second quarter results demonstrate the resilience of our franchise and reflect the value of disciplined execution across the company," said Clint Stein, Chairman, CEO & President. "While the operating environment remains dynamic, we continued to execute on our strategic priorities through prudent expense management, ongoing balance sheet optimization, and consistent capital returns to shareholders. Commercial loan balances continued to grow, reflecting the strength of our customer relationships and the trust we have built across our markets. We also continued to reposition the balance sheet in ways that support stronger long-term performance. Supported by our diversified business model, sound credit culture, and strong capital generation, we remain committed to delivering sustainable returns and creating long-term value for our shareholders." | | | | Clint Stein, Chairman, CEO & President of Columbia Banking System, Inc. | | |

2Q26 HIGHLIGHTS (COMPARED TO 1Q26)

Net Interest Income and NIM

• Net interest income decreased by $5 million from the prior quarter, due in part to $4 million of interest income reversals, alongside modest balance sheet deleveraging.
• Net interest margin was 3.93%, down 3 basis points from the prior quarter, as the interest income reversals mentioned above reduced the net interest margin by 3 basis points.

Non-Interest Income and Expense

• Non-interest income increased by $5 million, due primarily to higher treasury management and card-based fees, partially offset by quarterly changes in fair value adjustments and hedging activity. Results also include $3 million in death benefit proceeds related to a single policy.
• Non-interest expense decreased by $19 million, due to lower merger expense and the realization of acquisition-related cost savings.

Credit Quality

• Net charge-offs were 0.25% of average loans and leases (annualized), compared to 0.30% for the prior quarter.
• Provision expense was $27 million, compared to $28 million for the prior quarter.
• Non-performing assets to total assets ratio was 0.42%, compared to 0.40% as of March 31, 2026.

Capital

• Estimated total risk-based capital ratio of 13.4% and estimated common equity tier 1 risk-based capital ratio of 11.6%.
• Declared a quarterly cash dividend of $0.37 per common share on May 15, 2026, which was paid June 15, 2026.
• Repurchased $199 million of common stock under our current repurchase plan.

Notable Items

• Our first small business and retail campaign of 2026, which began in February and ended April 30, 2026, brought over $600 million in new deposits to the bank and also was successful in generating new SBA lending relationships. Our second campaign began in June and has generated approximately $650 million in new deposit balances through mid-July.

Investor Contact

Jacquelynne "Jacque" Bohlen, SVP/Director of Investor Relations, 503-727-4100, jacquebohlen@columbiabank.com

¹ "Non-GAAP" financial measure. See GAAP to Non-GAAP Reconciliation for additional information.

Columbia Banking System, Inc. Reports Second Quarter 2026 Results July 23, 2026 Organizational Update Columbia Banking System, Inc. ("Columbia," the "Company," "we," or "our") closed its acquisition of Pacific Premier Bancorp, Inc. ("Pacific Premier") on August 31, 2025, and completed the systems conversion and nine branch consolidations during the first quarter of 2026. All organizational changes and cost-related synergies were essentially complete as of June 30, 2026, including the achievement of our previously disclosed cost savings target associated with the Pacific Premier acquisition.

During the second quarter, we opened a branch in Colorado Springs and a financial hub in Las Vegas. We continue to strategically expand and refine our physical footprint to support relationship-driven growth, while funding these initiatives through targeted real estate optimization and other efficiency improvements.

Net Interest Income and Net Interest Margin

Net interest income was $589 million for the second quarter of 2026, down $5 million from the first quarter of 2026, due in part to $4 million of interest income reversals, alongside modest balance sheet deleveraging.

Columbia's net interest margin was 3.93% for the second quarter of 2026, down 3 basis points from the first quarter of 2026, as the interest income reversals mentioned above reduced the net interest margin by 3 basis points during the second quarter. Excluding this impact, net interest margin was consistent between periods, as higher yields on loans and leases partially offset a lower yield on taxable securities, driven by changes in prepayment speed expectations. Improved funding costs also contributed favorably to the net interest margin.

The cost of interest-bearing deposits decreased 8 basis points from the prior quarter to 1.96% for the second quarter of 2026, compared to 2.04% for the first quarter of 2026. The decrease during the second quarter reflects our active management of deposit rates and a lower mix of higher-cost brokered deposits. The cost of interest-bearing deposits was 1.95% for the month of June and 1.94% as of June 30, 2026.

Columbia's cost of interest-bearing liabilities decreased 3 basis points from the prior quarter to 2.21% for the second quarter of 2026, compared to 2.24% for the first quarter of 2026. The cost of interest-bearing liabilities was 2.22% for the month of June and 2.21% as of June 30, 2026. Refer to the Q2 2026 Earnings Presentation for additional net interest margin change details and interest rate sensitivity information.

Non-interest Income

Non-interest income was $88 million for the second quarter of 2026, up $5 million from the prior quarter. Quarterly changes in fair value adjustments and mortgage servicing rights ("MSR") hedging activity, which reflect interest rate fluctuations during the quarter, collectively resulted in a net fair value loss of $3 million for the second quarter, compared to a net fair value gain of $2 million for the first quarter, as detailed in our non-GAAP disclosures. Excluding these items, non-interest income was $91 million² for the second quarter of 2026, up $10 million between periods, due primarily to higher treasury management and card-based fees. We also received $3 million in death benefit proceeds during the second quarter related to a single policy, which was recorded in other income.

Non-interest Expense

Non-interest expense was $375 million for the second quarter of 2026, down $19 million from the prior quarter, due to lower merger expense. Excluding merger and restructuring expense and exit and disposal costs, as detailed in our non-GAAP disclosures, non-interest expense was $366 million², down $3 million from the prior quarter, due to cost savings related to the Pacific Premier acquisition. Refer to the Q2 2026 Earnings Presentation for additional expense details.

Balance Sheet

Total consolidated assets were $65.4 billion as of June 30, 2026, compared to $66.0 billion as of March 31, 2026. The decrease reflects balance sheet optimization activity. Cash and cash equivalents were $1.8 billion as of June 30, 2026, compared to $2.1 billion as of March 31, 2026. Including secured off-balance sheet lines of credit, total available liquidity was $25.6 billion as of June 30, 2026, representing 39% of total assets, 49% of total deposits, and 125% of uninsured deposits. Available-for-sale securities, which are held on balance sheet at fair value, were $11.1 billion as of June 30, 2026, compared to $10.9 billion as of March 31, 2026. The increase is due to the purchase of $462 million of investment securities, which offset paydowns and a decrease in the fair value of the portfolio. Refer to the Q2 2026 Earnings Presentation for additional details related to our investment securities portfolio and liquidity position.

² "Non-GAAP" financial measure. See GAAP to Non-GAAP Reconciliation for additional information.

Gross loans and leases were $47.2 billion as of June 30, 2026, compared to $47.7 billion as of March 31, 2026. The decrease reflects continued expected runoff in below-market-rate transactional loans and lower balances in non-owner occupied commercial real estate given elevated payoffs, due in part to competitive pricing pressure. Commercial loans, inclusive of owner-occupied commercial real estate, increased by 5% on an annualized basis relative to March 31, 2026, partially offsetting contraction in other portfolios. "Our bankers remained focused on relationship-driven activity during the second quarter, generating new business opportunities while continuing to manage the balance sheet with discipline," commented Tory Nixon, President of Columbia Bank. "Commercial relationship growth remained solid, and the continued runoff of lower-return transactional loans is reshaping our balance sheet as intended. Customer engagement remains healthy, and we remain encouraged by the quality of our pipelines and the opportunities we see across our western footprint." Refer to the Q2 2026 Earnings Presentation for additional details related to our loan portfolio, which include underwriting characteristics, the composition of our commercial portfolios, and disclosure related to transactional loans.

Total deposits were $52.1 billion as of June 30, 2026, compared to $53.5 billion as of March 31, 2026. The decrease reflects intentional reductions in brokered deposits and wholesale public deposits, which declined to $978 million and $928 million, respectively, as of June 30, 2026, compared to $1.6 billion and $1.2 billion, respectively, as of March 31, 2026. Customer deposit contraction in April due to seasonal tax payments also contributed to the decline between periods. "Seasonal factors reduced deposit balances early in the quarter, with balances stabilizing in May and June despite increasing competition," stated Mr. Nixon. "Our teams continue to emphasize relationship banking, serving our customers through advice-driven conversations and tailored solutions, while preserving the strength of our core deposit franchise. Meeting the evolving needs of our customers remains at the center of the value we provide." We utilized borrowings, which were $4.3 billion as of June 30, 2026, compared to $3.4 billion as of March 31, 2026, to supplement funding needs. Refer to the Q2 2026 Earnings Presentation for additional details related to deposit characteristics and flows.

Credit Quality

The allowance for credit losses ("ACL") was $475 million, or 1.01% of loans and leases, as of June 30, 2026, compared to $478 million, or 1.00% of loans and leases, as of March 31, 2026. The provision for credit losses was $27 million for the second quarter of 2026 and reflects loan portfolio runoff, credit migration trends, charge-off activity, and changes in the economic forecasts used in credit models.

Net charge-offs were 0.25% of average loans and leases (annualized) for the second quarter of 2026, compared to 0.30% for the first quarter of 2026. Net charge-offs in the FinPac portfolio were $15 million for the second quarter, compared to $14 million for the first quarter. Net charge-offs excluding the FinPac portfolio were $15 million for the second quarter, compared to $21 million for the first quarter. Non-performing assets were $273 million, or 0.42% of total assets, as of June 30, 2026, compared to $264 million, or 0.40% of total assets, as of March 31, 2026. Refer to the Q2 2026 Earnings Presentation for additional details related to the allowance for credit losses and other credit trends.

Capital

Columbia's book value per common share was $26.70 as of June 30, 2026, compared to $26.47 as of March 31, 2026. During the second quarter, Columbia repurchased 6.6 million common shares under its current repurchase plan at an average price of $29.93, representing 2.3% of outstanding common shares. Book value also was impacted by the change in accumulated other comprehensive (loss) income ("AOCI") to $(310) million as of June 30, 2026, compared to $(291) million as of the prior quarter-end. The change in AOCI is due primarily to an increase in the tax-effected net unrealized loss on available-for-sale securities to $275 million as of June 30, 2026, compared to $260 million as of March 31, 2026. Tangible book value per common share³ was $19.22 as of June 30, 2026, compared to $19.03 as of March 31, 2026.

Columbia's estimated total risk-based capital ratio was 13.4% and its estimated common equity tier 1 risk-based capital ratio was 11.6% as of June 30, 2026, compared to 13.5% and 11.7%, respectively, as of March 31, 2026. Columbia remains above current “well-capitalized” regulatory minimums. The regulatory capital ratios as of June 30, 2026 are estimates, pending completion and filing of Columbia's regulatory reports.

³ "Non-GAAP" financial measure. See GAAP to Non-GAAP Reconciliation for additional information.

Earnings Presentation and Conference Call Information Columbia's Q2 2026 Earnings Presentation provides additional disclosure. A copy will be available on our investor relations page: www.columbiabankingsystem.com.

Columbia will host its second quarter 2026 earnings conference call on July 23, 2026 at 2:00 p.m. PT (5:00 p.m. ET). During the call, Columbia's management will provide an update on recent activities and discuss its second quarter 2026 financial results. Participants may join the audiocast or register for the call using the link below to receive dial-in details and their own unique PINs. It is recommended you join 10 minutes prior to the start time.

Join the audiocast: https://edge.media-server.com/mmc/p/thdt6a5z/ Register for the call: https://register-conf.media-server.com/register/BIb20bf1c21e7e4dcd93e446da448dd1e9 Access the replay through Columbia's investor relations page: https://www.columbiabankingsystem.com/news-market-data/event-calendar/default.aspx About Columbia Banking System, Inc.

Columbia Banking System, Inc. (Nasdaq: COLB) is headquartered in Tacoma, Washington and is the parent company of Columbia Bank, an award-winning preeminent regional bank with offices in Arizona, California, Colorado, Idaho, Nevada, Oregon, Texas, Utah, and Washington. Columbia Bank combines the resources, sophistication, and expertise of a national bank with a commitment to deliver superior, personalized service. The bank supports consumers and businesses through a full suite of services, including retail and commercial banking, Small Business Administration lending, institutional and corporate banking, and equipment leasing. Columbia Bank customers also have access to comprehensive investment and wealth management expertise as well as healthcare and private banking through Columbia Wealth Management. Learn more at www.columbiabankingsystem.com.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject to risk and uncertainty and actual results could differ materially due to various risk factors, including those set forth from time to time in our filings with the Securities and Exchange Commission. You should not place undue reliance on forward-looking statements and we undertake no obligation to update any such statements. Forward-looking statements can be identified by words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects," "target," "projects," "outlook," "forecast," "will," "may," "could," "should," "can" and similar references to future periods. In this press release we make forward-looking statements about strategic and growth initiatives and the result of such activity. Risks and uncertainties that could cause results to differ from forward-looking statements we make include, without limitation: current and future economic and market conditions, including the effects of declines in housing and commercial real estate prices, high unemployment rates, renewed inflation and any recession or slowdown in economic growth particularly in the western United States; economic forecast variables that are either materially worse or better than end of quarter projections and deterioration in the economy that could result in increased loan and lease losses, especially those risks associated with concentrations in real estate related loans; risks related to our acquisition of Pacific Premier (the "Transaction"), including, among others, (i) any revenue synergies from the Transaction may not be fully realized or may take longer than anticipated to be realized, and (ii) deposit attrition as a result of the Transaction; the impact of proposed or imposed tariffs by the U.S. government and retaliatory tariffs proposed or imposed by U.S. trading partners that could have an adverse impact on customers; our ability to effectively manage problem credits; the impact of bank failures or adverse developments at other banks on general investor sentiment regarding the liquidity and stability of banks; changes in interest rates that could significantly reduce net interest income and negatively affect asset yields and valuations and funding sources; changes in the scope and cost of FDIC insurance and other coverage; our ability to successfully implement efficiency and operational excellence initiatives; our ability to successfully develop and market new products and technology; changes in laws or regulations; potential adverse reactions or changes to business or employee relationships; the effect of geopolitical instability, including wars, conflicts and terrorist attacks; and natural disasters and other similar unexpected events outside of our control. We also caution that the amount and timing of any future common stock dividends or repurchases will depend on the earnings, cash requirements and financial condition of Columbia, market conditions, capital requirements, applicable law and regulations (including federal securities laws and federal banking and state regulations), and other factors deemed relevant by Columbia's Board of Directors.

(1) See GAAP to Non-GAAP Reconciliation.

(2) Tax-exempt interest was adjusted to a taxable equivalent basis using a 21% tax rate.

(3) Total funding = total deposits + total borrowings.

(4) Estimated holding company ratios.

(1) See GAAP to Non-GAAP Reconciliation.

(2) Tax-exempt interest was adjusted to a taxable equivalent basis using a 21% tax rate.

(3) Total funding = Total deposits + Total borrowings.

(1) During the three months ended June 30, 2026, the Company aligned the presentation of certain loans with its established loan classification methodology. This resulted in approximately $174 million of loans being reported within different commercial real estate loan categories, primarily multifamily loans, with a corresponding decrease in non-owner occupied term loans.

(1) Core deposits are defined as total deposits less time deposits greater than $250,000 and all brokered deposits.

(1) Non-accrual and 90+ days past due loans include government guarantees of $78 million, $88 million, $79 million, $70 million, and $68 million at June 30, 2026, March 31, 2026, December 31, 2025, September 30, 2025, and June 30, 2025, respectively.

(2) Excludes certain mortgage loans that carry a government guarantee, which Columbia has the unilateral right to repurchase but has not done so, totaling $4 million, $4 million, $3 million, $2 million, and $2 million at June 30, 2026, March 31, 2026, December 31, 2025, September 30, 2025, and June 30, 2025, respectively.

(1)Non-accrual loans and leases are included in the average balance.

(2)Tax-exempt income was adjusted to a tax equivalent basis at a 21% tax rate. The amount of such adjustment was an addition to recorded income of approximately $3 million for the three months ended June 30, 2026, as compared to $2 million for the three months ended March 31, 2026 and $1 million for the three months ended June 30, 2025.

(1)Non-accrual loans and leases are included in the average balance.

(2)Tax-exempt income was adjusted to a tax equivalent basis at a 21% tax rate. The amount of such adjustment was an addition to recorded income of approximately $5 million for the year ended June 30, 2026, as compared to $2 million for the same period in 2025.

Non-GAAP Financial Measures

In addition to results presented in accordance with generally accepted accounting principles in the United States of America ("GAAP"), this press release contains certain non-GAAP financial measures. The Company believes presenting certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends, and our financial position. We utilize these measures for internal planning and forecasting purposes, and operating pre-provision net revenue and operating return on tangible common equity are also used as part of our incentive compensation program for our executive officers. We, as well as securities analysts, investors, and other interested parties, also use these measures to compare peer company operating performance. We believe that our presentation and discussion, together with the accompanying reconciliations, provides a complete understanding of factors and trends affecting our business and allows investors to view performance in a manner similar to management. These non-GAAP measures should not be considered a substitution for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names.

(1) Tax-exempt interest was adjusted to a taxable equivalent basis using a 21% tax rate and added to stated revenue for this calculation.

(1) Tax-exempt income was adjusted to a taxable equivalent basis using a 21% tax rate and added to stated revenue for this calculation.

(1) Tax-exempt interest was adjusted to a taxable equivalent basis using a 21% tax rate and added to stated revenue for this calculation.

(1) Tax-exempt income was adjusted to a taxable equivalent basis using a 21% tax rate and added to stated revenue for this calculation.