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COLUMBIA BANKING SYSTEM, INC.

COLB
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Business Summary

Columbia Banking System, Inc. operates as a financial holding company providing a broad range of banking, private banking, mortgage, and other financial services to corporate, institutional, small business, and individual customers through its principal subsidiary, Columbia Bank, an Oregon state-chartered commercial bank. The majority of the Bank's loans and deposits are within its service areas in Arizona, California, Colorado, Idaho, Nevada, Oregon, Utah, and Washington. The geographic markets the Company serves are highly competitive for deposits, loans, leases, and other fee-generating products and services, with competition coming from traditional banking institutions, credit unions, mortgage companies, fintechs, and online-based financial service providers. Major national banks generally hold top market share positions in these areas, and credit unions present a significant competitive challenge as they currently enjoy an exemption from income tax, allowing them to offer higher deposit rates and lower loan rates than banks on a comparable basis.

The Company seeks to compete by focusing on building customer relationships, providing superior service, and offering a wide variety of commercial and consumer banking products. As of June 30, 2025, the Bank held a market share of 16.39% in Oregon (ranked 2nd with 109 branches), 7.79% in Washington (ranked 5th with 111 branches), 3.65% in Idaho (ranked 12th with 25 branches), 1.14% in California (ranked 11th with 104 branches), 0.49% in Nevada (ranked 15th with 4 branches), 0.23% in Arizona (ranked 26th with 7 branches), 0.03% in Colorado (ranked 107th with 1 branch), and a negligible share in Utah with 1 branch. The Company's approach is a concentrated focus on full banking relationships, bringing together collaborative teams from commercial and consumer banking as well as wealth management, and leveraging its retail branch network to provide 'Community Banking at Scale' in support of its 'Business Bank of Choice' strategy.

The Company generates revenue primarily through net interest income, which is the difference between interest earned on loans, securities, and other interest-earning assets and the interest paid on deposits, borrowings, and other interest-bearing liabilities. Non-interest income is derived from service charges on deposits, card-based fees, financial services and trust revenue, residential mortgage banking revenue, gains on investment securities, gains or losses on loan and lease sales, gains or losses on certain loans held for investment at fair value, bank-owned life insurance income, and other income. The Company serves corporate, middle market, small business, and individual customers through a branch network, mobile banking applications, and its website. The Company's scaled franchise and offerings, talented associate base, and customer-focused business model enable it to provide comprehensive financial services in a manner that serves four identified stakeholder groups: associates, customers, shareholders, and communities.

The Company's commercial lending products include commercial lines of credit and term loans, accounts receivable and inventory financing, international trade finance, commercial property loans, multifamily loans, equipment loans, commercial equipment leases, real estate construction loans and permanent financing, SBA program financing, and capital markets. Treasury management and payments solutions are offered through the Global Payments & Deposits group, including business digital and mobile banking solutions, ACH, wires, positive pay, remote deposit capture, integrated payments, integrated receivables, lockbox, cash vault, Real-Time Payments via The Clearinghouse, commercial card, fraud prevention solutions, open application programming interfaces banking, foreign exchange, trade and supply chain finance, and international banking-related products. Deposit products include non-interest-bearing checking accounts, analyzed business accounts, interest-bearing checking and savings accounts, money market accounts, insured cash sweep and other investment sweep solutions, and certificates of deposit. The Wealth Management division provides financial planning, investment, trust, insurance, and private banking solutions through Columbia Wealth Advisors, Columbia Trust Company, Columbia Private Trust, and Columbia Private Bank. Residential real estate loans are available for the construction, purchase, and refinancing of residential owner-occupied and rental properties, with many loans sold into the secondary market while servicing is retained on the majority. Consumer loans include secured and unsecured personal loans, home equity and personal lines of credit, and motor vehicle loans.

As of December 31, 2025, total loans and leases were $47.776 billion , with commercial real estate comprising $27.870 billion (including non-owner occupied term of $8.206 billion , owner occupied term of $7.314 billion , multifamily of $10.281 billion , construction & development of $1.707 billion , and residential development of $362 million ), commercial loans of $11.955 billion (including term of $6.713 billion , lines of credit & other of $3.643 billion , and leases & equipment finance of $1.599 billion ), residential mortgage of $5.624 billion , home equity loans & lines of $2.149 billion , and consumer & other of $178 million . Total deposits were $54.211 billion as of December 31, 2025, consisting of non-interest-bearing demand deposits of $17.419 billion , interest-bearing demand deposits of $10.763 billion , money market deposits of $17.013 billion , savings deposits of $2.442 billion , time deposits of $250,000 or less of $4.893 billion , and time deposits greater than $250,000 of $1.681 billion . The Company's total core deposits, which are deposits less time deposits greater than $250,000 and all brokered deposits, were $50.2 billion as of December 31, 2025.

On August 31, 2025, the Company completed its all-stock acquisition of Pacific Premier Bancorp, Inc., with Pacific Premier stockholders receiving 0.9150 of a share of Columbia common stock for each share of Pacific Premier common stock they held. The acquisition contributed $11.4 billion in loans, $2.8 billion in investment securities, $874 million in cash, and $14.5 billion of deposits. The Company recorded $453 million in goodwill related to the acquisition. In 2025, the Company repurchased 3.7 million common shares for a total of $100 million under a new repurchase program approved by the Board in October 2025, which authorizes the repurchase of up to $700 million of common stock through November 30, 2026. The Company paid cash dividends of $1.45 per common share during the year ended December 31, 2025, and in November 2025 increased its quarterly dividend to $0.37 per common share, compared to $0.36 per common share previously. The Company also recorded a $55 million accrual for a legal settlement during the year.

For the year ended December 31, 2025, net income was $550 million , compared to $534 million for the year ended December 31, 2024. Earnings per diluted common share were $2.30 for 2025, compared to $2.55 for 2024. Net interest income was $2.0 billion for 2025, an increase of $285 million , or 17% , compared to $1.7 billion in 2024. The net interest margin on a tax equivalent basis was 3.83% for 2025, compared to 3.57% for 2024. Non-interest income was $298 million for 2025, compared to $211 million for 2024. Non-interest expense was $1.4 billion for 2025, compared to $1.1 billion for 2024. The provision for credit losses was $150 million for 2025, compared to $106 million in the prior year. Total consolidated assets were $66.832 billion as of December 31, 2025, compared to $51.576 billion as of December 31, 2024.

Business Outlook

The Company expects to realize all related cost savings from the Pacific Premier acquisition by June 30, 2026 and expects to stay within the original expected merger-related expense amount of $185 million for this acquisition. Systems conversion and branch consolidations related to the acquisition are on track to be completed during the first quarter of 2026 .

The acquisition of Pacific Premier greatly accelerated the Company's Southern California expansion strategy and enhanced its presence in other growth markets in its footprint, supporting its targeted strategy to expand market share in communities in the western United States. The acquisition rounds out the Company's western footprint and strengthens its presence as a leading financial institution in the western United States, while also expanding product and service offerings to deliver more comprehensive, needs-based financial solutions. The Company is focusing on growth opportunities in Arizona, Colorado, Texas, and Utah, and in 2025, due to the acquisition of Pacific Premier, the Bank expanded its market area into Texas through an HOA office. The Company's approach is a concentrated focus on full banking relationships, bringing together collaborative teams from commercial and consumer banking as well as wealth management, and leveraging its retail branch network to provide 'Community Banking at Scale' in support of its 'Business Bank of Choice' strategy.

The Company expects customer deposit balance trends to be a driver of net interest margin performance, as it continues to target a lower funding contribution from wholesale sources, like brokered deposits and FHLB advances. The Company manages its cash position as part of management's strategy to maintain a high-quality liquid asset position to support balance sheet flexibility, fund growth in lending and investment portfolios, and deleverage the balance sheet by decreasing debt and non-relationship deposit liabilities as economic conditions permit. The Company's capital deployment strategy remains focused on supporting organic growth, maintaining strong regulatory ratios, and returning capital to shareholders through dividends and share repurchases.

The Company's branch system and other delivery channels are continually evaluated as an important component of ongoing efforts to improve efficiencies without compromising customer service. The Company remains on track to complete the systems conversion and branch consolidations related to the Pacific Premier acquisition during the first quarter of 2026, and expects to realize all related cost savings by June 2026. The Company employed 6,005 individuals as of December 31, 2025, a 27% increase attributed largely to the acquisition of Pacific Premier Bank in September 2025. The turnover rate for the combined company was 20.8% .

The Company's Board approved a new share repurchase program on October 29, 2025, authorizing the Company to repurchase up to $700 million of common stock through November 30, 2026 . As of December 31, 2025, a total of $600 million remained available to repurchase shares. The Company paid cash dividends of $1.45 per common share during the year ended December 31, 2025, and in November 2025 increased its quarterly dividend to $0.37 per common share, compared to $0.36 per common share previously. The Company's dividend policy considers earnings, regulatory capital levels, the overall payout ratio, and expected asset growth to determine the amount of dividends declared. The Company repurchased 3.7 million common shares for a total of $100 million during the year ended December 31, 2025.

The Company faces structural headwinds from the highly competitive nature of its geographic markets, where major national banks generally hold top market share positions and credit unions enjoy an exemption from income tax, allowing them to offer higher deposit rates and lower loan rates. The Company also faces competition from Internet-based banking institutions and financial technology companies, which have grown rapidly in recent years. Additionally, the Company is subject to extensive regulation, supervision, and examination by federal and state banking authorities, and any change in applicable regulations or policies could have a substantial impact on its operations. The Company's business is directly impacted by factors such as economic, political, and market conditions, changes in government monetary and fiscal policies, and inflation, all of which are beyond its control. The Company also faces risks related to the potential for renewed inflationary pressures from the possible economic policies of the U.S. presidential administration, including tariffs.

Risk Factors

The Company's loan portfolio is concentrated in commercial real estate and commercial business loans, which generally have more risk of default than residential real estate loans, and as of December 31, 2025, 76% of total gross loans were secured by real estate. The Company's allowance for credit losses was $485 million as of December 31, 2025, and a hypothetical adverse economic scenario (Moody's Analytics S2 scenario) would result in a quantitative lifetime loss estimate approximately 1.4 times the modeled period-end ACL, an increase of approximately $147 million . The Company faces significant cybersecurity risks, as evidenced by a 2023 security incident involving a technology service provider that resulted in the unauthorized acquisition of names and social security numbers or tax identification numbers of approximately 429,000 consumer and small business customers. The Company is subject to extensive regulation, and as an insured depository institution with assets of $10 billion or more, the Consumer Financial Protection Bureau has primary enforcement authority for federal consumer financial laws over the Bank. The Company's ability to pay dividends is subject to regulatory restrictions, and the Bank currently has an accumulated deficit and is required to seek FDIC and DCBS approval for dividends from Columbia Bank to the Company.

Management Priorities

Management's message emphasizes the successful completion of the all-stock acquisition of Pacific Premier on August 31, 2025, which rounds out the Company's western footprint and strengthens its presence as a leading financial institution in the western United States. Management highlights that systems conversion and branch consolidations are on track to be completed during the first quarter of 2026 , supported by comprehensive cross-company teams led by Columbia's Integration Management Office. The Company expects to realize all related cost savings by June 30, 2026 and expects to stay within the original expected merger-related expense amount of $185 million for this acquisition. Management's strategic priorities for the period ahead include focusing on balanced, relationship-driven growth in loans, deposits, and sustainable core fee income, maintaining asset quality and granular loan and deposit portfolios diversified by product, customer, industry, and geography, and expanding total revenue while controlling expenses in an effort to gain operational efficiencies and increase return on average tangible common equity. The Company's capital deployment strategy remains focused on supporting organic growth, maintaining strong regulatory ratios, and returning capital to shareholders through dividends and share repurchases.

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 1, Business — Market Area and Competition
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  20. [20] Item 1, Business — Market Area and Competition
  21. [21] Item 1, Business — Market Area and Competition
  22. [22] Item 1, Business — Market Area and Competition
  23. [23] Item 8, Note 5 — Loans and Leases
  24. [24] Item 7, MD&A — Loans and Leases
  25. [25] Item 7, MD&A — Loans and Leases
  26. [26] Item 7, MD&A — Loans and Leases
  27. [27] Item 7, MD&A — Loans and Leases
  28. [28] Item 7, MD&A — Loans and Leases
  29. [29] Item 7, MD&A — Loans and Leases
  30. [30] Item 7, MD&A — Loans and Leases
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  34. [34] Item 7, MD&A — Loans and Leases
  35. [35] Item 7, MD&A — Loans and Leases
  36. [36] Item 7, MD&A — Loans and Leases
  37. [37] Item 7, MD&A — Deposits
  38. [38] Item 7, MD&A — Deposits
  39. [39] Item 7, MD&A — Deposits
  40. [40] Item 7, MD&A — Deposits
  41. [41] Item 7, MD&A — Deposits
  42. [42] Item 7, MD&A — Deposits
  43. [43] Item 7, MD&A — Deposits
  44. [44] Item 7, MD&A — Deposits
  45. [45] Item 7, MD&A — Executive Overview
  46. [46] Item 7, MD&A — Executive Overview
  47. [47] Item 7, MD&A — Executive Overview
  48. [48] Item 7, MD&A — Executive Overview
  49. [49] Item 7, MD&A — Executive Overview
  50. [50] Item 7, MD&A — Goodwill and Other Intangible Assets
  51. [51] Item 7, MD&A — Executive Overview
  52. [52] Item 7, MD&A — Executive Overview
  53. [53] Item 5, Market for Registrant's Common Equity
  54. [54] Item 7, MD&A — Capital Resources
  55. [55] Item 7, MD&A — Executive Overview
  56. [56] Item 7, MD&A — Executive Overview
  57. [57] Item 7, MD&A — Non-Interest Expense
  58. [58] Item 7, MD&A — Executive Overview
  59. [59] Item 7, MD&A — Executive Overview
  60. [60] Item 7, MD&A — Executive Overview
  61. [61] Item 7, MD&A — Executive Overview
  62. [62] Item 7, MD&A — Net Interest Income
  63. [63] Item 7, MD&A — Net Interest Income
  64. [64] Item 7, MD&A — Net Interest Income
  65. [65] Item 7, MD&A — Net Interest Income
  66. [66] Item 7, MD&A — Net Interest Income
  67. [67] Item 7, MD&A — Net Interest Income
  68. [68] Item 7, MD&A — Non-Interest Income
  69. [69] Item 7, MD&A — Non-Interest Income
  70. [70] Item 7, MD&A — Non-Interest Expense
  71. [71] Item 7, MD&A — Non-Interest Expense
  72. [72] Item 7, MD&A — Provision for Credit Losses
  73. [73] Item 7, MD&A — Provision for Credit Losses
  74. [74] Item 8, Consolidated Balance Sheets
  75. [75] Item 8, Consolidated Balance Sheets
  76. [76] Item 7, MD&A — Results of Operations
  77. [77] Item 7, MD&A — Results of Operations
  78. [78] Item 7, MD&A — Results of Operations
  79. [79] Item 1, Business — Human Capital
  80. [80] Item 1, Business — Human Capital
  81. [81] Item 1, Business — Human Capital
  82. [82] Item 5, Market for Registrant's Common Equity
  83. [83] Item 5, Market for Registrant's Common Equity
  84. [84] Item 5, Market for Registrant's Common Equity
  85. [85] Item 7, MD&A — Capital Resources
  86. [86] Item 7, MD&A — Executive Overview
  87. [87] Item 7, MD&A — Executive Overview
  88. [88] Item 7, MD&A — Executive Overview
  89. [89] Item 7, MD&A — Executive Overview
  90. [90] Item 1A, Risk Factors
  91. [91] Item 7, MD&A — Allowance for Credit Losses
  92. [92] Item 7, MD&A — Critical Accounting Estimates
  93. [93] Item 7, MD&A — Critical Accounting Estimates
  94. [94] Item 1C, Cybersecurity
  95. [95] Item 8, Consolidated Balance Sheets
  96. [96] Item 7, MD&A — Results of Operations
  97. [97] Item 7, MD&A — Results of Operations
  98. [98] Item 7, MD&A — Results of Operations
  99. [99] Item 8, Consolidated Statements of Income
  100. [100] Item 8, Consolidated Statements of Income
  101. [101] Item 8, Consolidated Statements of Income
  102. [102] Item 8, Consolidated Statements of Income
  103. [103] Item 8, Consolidated Statements of Income
  104. [104] Item 8, Consolidated Statements of Income
  105. [105] Item 8, Consolidated Statements of Income
  106. [106] Item 8, Consolidated Statements of Income
  107. [107] Item 8, Consolidated Statements of Income
  108. [108] Item 8, Consolidated Statements of Income
  109. [109] Item 8, Consolidated Statements of Income
  110. [110] Item 8, Consolidated Statements of Income
  111. [111] Item 8, Consolidated Statements of Income
  112. [112] Item 8, Consolidated Statements of Income
  113. [113] Item 7, MD&A — Income Taxes
  114. [114] Item 7, MD&A — Income Taxes
  115. [115] Item 7, MD&A — Return on Average Assets
  116. [116] Item 7, MD&A — Return on Average Assets
  117. [117] Item 7, MD&A — Return on Average Assets
  118. [118] Item 7, MD&A — Return on Average Assets
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  120. [120] Item 7, MD&A — Return on Average Assets
  121. [121] Item 7, MD&A — Provision for Credit Losses
  122. [122] Item 7, MD&A — Provision for Credit Losses
  123. [123] Item 7, MD&A — Provision for Credit Losses
  124. [124] Item 7, MD&A — Provision for Credit Losses
  125. [125] Item 7, MD&A — Capital Resources
  126. [126] Item 7, MD&A — Capital Resources
  127. [127] Item 7, MD&A — Capital Resources
  128. [128] Item 7, MD&A — Capital Resources
  129. [129] Item 7, MD&A — Return on Average Assets
  130. [130] Item 7, MD&A — Return on Average Assets
  131. [131] Item 7, MD&A — Non-Interest Expense
  132. [132] Item 7, MD&A — Non-Interest Expense
  133. [133] Item 7, MD&A — Non-Interest Expense

Analysis on 6/21/2026