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FULTON FINANCIAL CORP

FULT
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Business Summary

Fulton Financial Corporation is a financial holding company that, through its wholly-owned banking subsidiary Fulton Bank, N.A., delivers financial services primarily within a five-state market area comprised of Pennsylvania, Delaware, Maryland, New Jersey and Virginia in a personalized, community-oriented style that emphasizes relationship banking. The Corporation operates in areas that are home to a wide range of manufacturing, healthcare, agriculture and other service companies. Although a large portion of the loan portfolio is comprised of commercial loans, commercial mortgage loans and construction loans, the Corporation is not dependent upon one or a few customers and the loss of any single customer or a few customers would not have a material adverse impact on its business.

The banking and financial services industries are highly competitive. Within its geographic region, the Corporation faces direct competition from other commercial banks, varying in size from local community banks to regional and national banks, credit unions and non-bank entities. The Corporation also faces competition from financial institutions that do not have a physical presence in its geographic markets as a result of the wide availability of electronic delivery channels. The industry is also highly competitive due to the various types of entities that now compete aggressively for customers that were traditionally served only by the banking industry, including FinTechs, private equity funds, private debt funds and marketplace lenders that, in many cases, are not subject to the same regulatory compliance requirements as the Corporation.

The Corporation generates the majority of its revenue through net interest income, or the difference between interest earned on loans and investments and interest paid on deposits and borrowings. Growth in net interest income is dependent upon balance sheet growth and maintaining or increasing the net interest margin, which is FTE net interest income as a percentage of average interest-earning assets. The Corporation also generates revenue through fees earned on the various services and products offered to its customers and through gains on sales of assets, such as loans, investments and properties. Offsetting these revenue sources are provisions for credit losses on loans and off-balance-sheet credit risks, non-interest expenses and income taxes.

The Corporation offers a wide range of consumer and commercial banking products and services, as well as wealth management products and services. Consumer banking products and services include various checking account and savings deposit products, certificates of deposit, home equity loans and lines of credit, a variety of fixed, variable and adjustable rate mortgage products including construction loans and jumbo residential mortgage loans, automobile loans, student loans, personal loans and lines of credit and checking account overdraft protection. Commercial banking products and services are provided primarily to small- and medium-sized businesses (generally with annual gross revenue of less than $500 million) and include commercial real estate loans, commercial and industrial loans, construction loans, equipment lease financing, letters of credit, cash management services and traditional deposit products. Wealth management services include investment management, trust, brokerage, insurance and investment advisory services, delivered through Fulton Financial Advisors and Fulton Private Bank, both operating divisions of Fulton Bank.

The Corporation delivers its products and services through a network of financial center locations and electronic delivery channels including a network of ATMs and telephone, mobile and online banking. As of December 31, 2025, the Corporation had 204 financial centers, not including remote service facilities (mainly stand-alone ATMs), and its main office located in Lancaster, Pennsylvania. Of those 204 financial centers, 43 were owned and 161 were leased. The Corporation owns an operations center located in East Petersburg, Pennsylvania.

On November 24, 2025, the Corporation entered into the Merger Agreement with Blue Foundry Bancorp. Under the terms of the Merger Agreement, Blue Foundry will merge with and into the Corporation, with the Corporation continuing as the surviving corporation. Shareholders of Blue Foundry approved the Merger at the Blue Foundry special shareholder meeting on January 29, 2026, and all regulatory approvals required to complete the Merger have been obtained. Subject to the satisfaction of the remaining customary closing conditions, the Corporation expects the Merger to close on or about April 1, 2026, and Blue Foundry Bank is expected to be merged with and into Fulton Bank in the third quarter of 2026. On April 26, 2024, Fulton Bank completed the Republic First Transaction, the acquisition of substantially all of the assets and assumption of substantially all of the deposits and certain liabilities of Republic First Bank from the FDIC. During the year ended December 31, 2025, approximately 3.3 million shares of common stock were repurchased at a total cost of $59.7 million , or an average cost of $18.16 per share , under the 2025 Repurchase Program. On December 16, 2025, the Corporation announced that its Board of Directors approved the 2026 Repurchase Program authorizing the repurchase of up to $150.0 million of shares of its common stock, with up to $25.0 million of that authorization available to repurchase the Corporation's preferred stock and outstanding subordinated notes.

Net income available to common shareholders was $381.4 million for the year ended December 31, 2025, a $102.9 million increase compared to $278.5 million in 2024. Net income available to common shareholders per diluted share was $2.08 for the year ended December 31, 2025, a $0.51 increase compared to $1.57 in 2024. Net interest income was $1.0 billion , a $76.0 million increase compared to $960.3 million in 2024. The net interest margin was 3.51% , a nine basis point increase compared to 3.42% in 2024. Non-interest income was $276.8 million , a $1.0 million increase compared to $275.7 million in 2024. Non-interest expense was $791.8 million , a $28.0 million decrease compared to $819.8 million in 2024. The provision for credit losses was $35.7 million in 2025 compared to $71.6 million in 2024. The return on average assets was 1.23% and the return on average common shareholders' equity was 12.09% .

Business Outlook

The Corporation's primary growth vector is the pending Merger with Blue Foundry Bancorp. Under the terms of the Merger Agreement, Blue Foundry will merge with and into the Corporation, with the Corporation continuing as the surviving corporation. The combined company will operate under the Corporation's name and will trade under the ticker symbol 'FULT.' Subject to the satisfaction of the remaining customary closing conditions, the Corporation expects the Merger to close on or about April 1, 2026, and Blue Foundry Bank is expected to be merged with and into Fulton Bank in the third quarter of 2026. The Corporation developed a comprehensive integration plan with respect to the Merger and will expense direct costs as incurred; these direct costs related to the Merger totaled $1.1 million for the year ending December 31, 2025.

The Corporation's business plan includes the pursuit of profitable growth, which may involve pursuing new lines of business or offering new products or services, all of which can involve significant costs, uncertainties and risks. The Corporation may also seek to supplement organic growth through acquisitions of banks, branches or other financial businesses or assets. The Corporation's growth strategy also includes the FultonFirst strategic initiative, a program to simplify its operating model, improve its relationship banking focus, increase productivity and enhance the customer experience. FultonFirst implementation and asset disposal costs were $2.3 million for the year ended December 31, 2025, compared to $32.0 million in 2024.

The efficiency ratio was 57.6% for the year ended December 31, 2025, compared to 60.8% in 2024. Excluding the gain on the Sale-Leaseback Transaction, acquisition-related expenses and FultonFirst implementation and asset disposal costs, non-interest expense increased $18.0 million , or 2.3% , in 2025 compared to 2024. The increase was primarily due to an $18.0 million increase in salaries and employee benefits expense, driven by higher incentive compensation expense, annual merit increases and lower deferred costs from loan origination activities.

The Corporation's workforce, excluding temporary employees and interns, consisted of approximately 3,400 employees at December 31, 2025. The Corporation invests in its workforce by offering a comprehensive Total Rewards program that includes competitive salaries, incentives, and benefits programs. The Corporation provides for professional development of new and existing employees through the efforts of its Learning and Development area and also provides a number of third-party offerings in which employees can further enhance their skills, knowledge and leadership potential.

On December 16, 2025, the Corporation announced that its Board of Directors approved the 2026 Repurchase Program, authorizing the repurchase of up to $150.0 million of shares of its common stock, with up to $25.0 million of that authorization available to repurchase the Corporation's preferred stock and outstanding subordinated notes. The 2026 Repurchase Program will expire on January 31, 2027. During the year ended December 31, 2025, approximately 3.3 million shares of common stock were repurchased at a total cost of $59.7 million , or an average cost of $18.16 per share , under the 2025 Repurchase Program. The Corporation has pursued a strategy of capital management under which it has sought to deploy capital through stock repurchases and dividends on its common stock.

The Corporation faces structural headwinds from difficult conditions in the economy and the financial markets, which can be caused by declines in economic growth, business activity or investor or business confidence; limitations on the availability, or increases in the cost, of credit and capital; changes in the rate of inflation or in interest rates; high unemployment; labor shortages; governmental fiscal and monetary policies; trade policies and tariffs; geopolitical events; natural disasters; public health crises; and acts of war or terrorism. The Corporation's financial performance is highly dependent upon the business environment in the markets where it operates and in the United States as a whole. Unlike large, national institutions, the Corporation is not able to spread the risks of unfavorable local economic conditions across a large number of diversified economies and geographic locations.

The Corporation is subject to interest rate risk, as net interest income is the most significant component of its net income, accounting for approximately 79% of total revenues in 2025. Changes in market interest rates, in the shape of the yield curve or in spreads between different market interest rates can have a material effect on the net interest margin. As a result of elevated interest rates in recent years, the fair value of the Corporation's AFS investment securities declined resulting in unrealized losses of approximately $206 million as of December 31, 2025, reflected in AOCI as a reduction to total shareholders' equity. The Corporation is also dependent on customer deposits as its primary source of funding, and at December 31, 2025, approximately 36% of its deposits (excluding Intra-Company deposits) were uninsured.

Risk Factors

The Corporation's loan portfolio composition subjects it to credit risk, as approximately 63% of the loan portfolio consisted of commercial loans, commercial mortgage loans, and residential and commercial construction loans at December 31, 2025, and commercial mortgage loans alone represented approximately 41% of the loan portfolio. These loans involve a greater degree of credit risk than residential mortgage loans and consumer loans because repayment often depends on the successful operation and management of borrowers' businesses and properties, and the market for commercial real estate is cyclical. The Corporation is also subject to interest rate risk, as net interest income accounted for approximately 79% of total revenues in 2025, and changes in market interest rates can have a material effect on the net interest margin. As of December 31, 2025, unrealized losses on AFS investment securities were approximately $206 million , reflected in AOCI. The Corporation is dependent on customer deposits as its primary source of funding, and at December 31, 2025, approximately 36% of deposits (excluding Intra-Company deposits) were uninsured, creating liquidity risk if depositor confidence erodes. Additionally, the Corporation faces risks related to the pending Merger with Blue Foundry Bancorp, including the potential failure to realize anticipated cost savings and revenue synergies, higher-than-expected integration costs, and the diversion of management's attention from ongoing business operations.

Management Priorities

Management's message emphasizes the Corporation's financial performance for the year ended December 31, 2025, highlighting net income available to common shareholders of $381.4 million and diluted EPS of $2.08 , compared to $278.5 million and $1.57 in 2024. Key themes include the net interest margin expansion to 3.51% from 3.42% , the successful completion of the Republic First Transaction in 2024, and the pending Merger with Blue Foundry Bancorp, which is expected to close on or about April 1, 2026. Management's strategic priorities for the period ahead include executing the integration of Blue Foundry Bank, continuing the FultonFirst strategic initiative to simplify the operating model and improve productivity, and managing capital through the 2026 Repurchase Program authorizing up to $150.0 million in share repurchases.

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  2. [2] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  3. [3] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  4. [4] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  5. [5] Item 7, MD&A — Financial Highlights
  6. [6] Item 7, MD&A — Financial Highlights
  7. [7] Item 7, MD&A — Financial Highlights
  8. [8] Item 7, MD&A — Financial Highlights
  9. [9] Item 7, MD&A — Overview
  10. [10] Item 7, MD&A — Overview
  11. [11] Item 7, MD&A — Financial Highlights
  12. [12] Item 7, MD&A — Financial Highlights
  13. [13] Item 7, MD&A — Financial Highlights
  14. [14] Item 7, MD&A — Financial Highlights
  15. [15] Item 7, MD&A — Financial Highlights
  16. [16] Item 7, MD&A — Financial Highlights
  17. [17] Item 7, MD&A — Provision for Credit Losses
  18. [18] Item 7, MD&A — Provision for Credit Losses
  19. [19] Item 7, MD&A — Overview
  20. [20] Item 7, MD&A — Overview
  21. [21] Item 7, MD&A — Overview
  22. [22] Item 7, MD&A — Non-Interest Expense
  23. [23] Item 7, MD&A — Non-Interest Expense
  24. [24] Item 7, MD&A — Supplemental Reporting of Non-GAAP Based Financial Measures
  25. [25] Item 7, MD&A — Supplemental Reporting of Non-GAAP Based Financial Measures
  26. [26] Item 7, MD&A — Non-Interest Expense
  27. [27] Item 7, MD&A — Non-Interest Expense
  28. [28] Item 1, Business — Human Capital
  29. [29] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  30. [30] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  31. [31] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  32. [32] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  33. [33] Item 1A, Risk Factors — Interest Rate and Credit Risks
  34. [34] Item 1A, Risk Factors — Interest Rate and Credit Risks
  35. [35] Item 1A, Risk Factors — Liquidity and Capital Risks
  36. [36] Item 1A, Risk Factors — Interest Rate and Credit Risks
  37. [37] Item 1A, Risk Factors — Interest Rate and Credit Risks
  38. [38] Item 1A, Risk Factors — Interest Rate and Credit Risks
  39. [39] Item 1A, Risk Factors — Interest Rate and Credit Risks
  40. [40] Item 1A, Risk Factors — Liquidity and Capital Risks
  41. [41] Item 7, MD&A — Financial Highlights
  42. [42] Item 7, MD&A — Financial Highlights
  43. [43] Item 7, MD&A — Financial Highlights
  44. [44] Item 7, MD&A — Financial Highlights
  45. [45] Item 7, MD&A — Financial Highlights
  46. [46] Item 7, MD&A — Financial Highlights
  47. [47] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  48. [48] Item 8, Note 17 — Segment Reporting
  49. [49] Item 8, Note 17 — Segment Reporting
  50. [50] Item 8, Consolidated Statements of Income
  51. [51] Item 8, Consolidated Statements of Income
  52. [52] Item 8, Note 14 — Earnings Per Share
  53. [53] Item 8, Note 14 — Earnings Per Share
  54. [54] Item 7, MD&A — Net Interest Income
  55. [55] Item 7, MD&A — Net Interest Income
  56. [56] Item 7, MD&A — Overview
  57. [57] Item 7, MD&A — Overview
  58. [58] Item 7, MD&A — Supplemental Reporting of Non-GAAP Based Financial Measures
  59. [59] Item 7, MD&A — Supplemental Reporting of Non-GAAP Based Financial Measures
  60. [60] Item 7, MD&A — Supplemental Reporting of Non-GAAP Based Financial Measures
  61. [61] Item 7, MD&A — Supplemental Reporting of Non-GAAP Based Financial Measures
  62. [62] Item 7, MD&A — Provision for Credit Losses
  63. [63] Item 7, MD&A — Provision for Credit Losses
  64. [64] Item 7, MD&A — Provision for Credit Losses
  65. [65] Item 7, MD&A — Non-Interest Expense
  66. [66] Item 7, MD&A — Non-Interest Expense
  67. [67] Item 7, MD&A — Non-Interest Expense
  68. [68] Item 7, MD&A — Non-Interest Expense
  69. [69] Item 7, MD&A — Non-Interest Expense
  70. [70] Item 7, MD&A — Non-Interest Expense
  71. [71] Item 7, MD&A — Non-Interest Expense
  72. [72] Item 7, MD&A — Income Taxes
  73. [73] Item 7, MD&A — Income Taxes
  74. [74] Item 7, MD&A — Income Taxes
  75. [75] Item 7, MD&A — Income Taxes
  76. [76] Item 7, MD&A — Allowance for Credit Losses
  77. [77] Item 7, MD&A — Allowance for Credit Losses
  78. [78] Item 7, MD&A — Allowance for Credit Losses
  79. [79] Item 7, MD&A — Allowance for Credit Losses
  80. [80] Item 7, MD&A — Allowance for Credit Losses
  81. [81] Item 7, MD&A — Allowance for Credit Losses

Analysis on 6/21/2026