What changed in this filing

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Item 1. Financial Statements

2024-08-08 compared with 2024-05-09 · 229 added, 155 removed, 914 unchanged (30% of the section changed)

3 unchanged sentences

(in thousands, except share data;

unaudited) March 31, 2024 December 31, 2023

unaudited) June 30, 2024 December 31, 2023

Cash, cash equivalents and restricted cash $ 231,408 $ 30,453

Investment securities:

Held-to-maturity, at amortized cost (net of zero allowance for credit losses at March 31, 2024 and December 31, 2023)

Held-to-maturity, at amortized cost (net of zero allowance for credit losses at June 30, 2024 and December 31, 2023)

904,610 925,198

Available-for-sale, at fair value (net of zero allowance for credit losses at March 31, 2024 and December 31, 2023)

Available-for-sale, at fair value (net of zero allowance for credit losses at June 30, 2024 and December 31, 2023)

252,917 552,028

29 unchanged sentences

Authorized - 30,000,000 shares;

issued and outstanding - 16,285,786 and 16,158,413 at March 31, 2024 and December 31, 2023, respectively

issued and outstanding - 16,278,260 and 16,158,413 at June 30, 2024 and December 31, 2023, respectively

218,773 217,498

5 unchanged sentences

BANK OF MARIN BANCORP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three months ended

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

Three months ended Six months ended

(in thousands, except per share amounts;

unaudited) March 31, 2024 December 31, 2023 March 31, 2023

unaudited) June 30, 2024 March 31, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Interest income

21 unchanged sentences

Merchant interchange fees, net 10 167 127 177 260

Losses on sale of investment securities, net of gains — ( 5,907 ) —

Losses on sale of investment securities ( 32,542 ) — — ( 32,542 ) —

Other income 420 285 326 705 630

10 unchanged sentences

Directors' expense 306 317 300 623 621

Charitable contributions 604 13 638 617 687

Amortization of core deposit intangible 246 251 340 497 685

2 unchanged sentences

Total non-interest expense 21,894 21,169 20,665 43,063 40,445

Income before provision for income taxes 3,929 392 12,878

Provision for income taxes 1,007 ( 218 ) 3,438

Net income $ 2,922 $ 610 $ 9,440

Net income per common share:

(Loss) income before (benefit from) provision for income taxes ( 34,382 ) 3,929 5,872 ( 30,453 ) 18,750

(Benefit from) provision for income taxes ( 12,480 ) 1,007 1,321 ( 11,473 ) 4,759

Net (loss) income $ ( 21,902 ) $ 2,922 $ 4,551 $ ( 18,980 ) $ 13,991

Net (loss) income per common share:

Basic $ ( 1.36 ) $ 0.18 $ 0.28 $ ( 1.18 ) $ 0.88

4 unchanged sentences

Comprehensive income:

Net income $ 2,922 $ 610 $ 9,440

Other comprehensive (loss) income:

Net (loss) income $ ( 21,902 ) $ 2,922 $ 4,551 $ ( 18,980 ) $ 13,991

Other comprehensive income (loss):

Change in net unrealized gains or losses on available-for-sale securities 559 ( 4,568 ) ( 10,928 ) ( 4,009 ) 5,285

2 unchanged sentences

Amortization of net unrealized losses on securities transferred from available-for-sale to held-to-maturity 403 361 451 764 914

Other comprehensive (loss) income, before tax ( 2,990 ) 33,464 16,676

Deferred tax (benefit) expense ( 884 ) 9,890 4,930

Other comprehensive (loss) income, net of tax ( 2,106 ) 23,574 11,746

Total comprehensive income $ 816 $ 24,184 $ 21,186

Other comprehensive income (loss), before tax 33,786 ( 2,990 ) ( 10,477 ) 30,796 6,199

Deferred tax expense (benefit) 9,981 ( 884 ) ( 3,097 ) 9,097 1,833

Other comprehensive income (loss), net of tax 23,805 ( 2,106 ) ( 7,380 ) 21,699 4,366

Total comprehensive income (loss) $ 1,903 $ 816 $ ( 2,829 ) $ 2,719 $ 18,357

The accompanying notes are an integral part of these consolidated financial statements (unaudited).

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

For the three months ended March 31, 2024 and 2023

For the three months ended June 30, 2024 and 2023

(in thousands, except share data;

1 unchanged sentence

Earnings Accumulated Other

Comprehensive (Loss) Income,

Comprehensive Loss,

Net of Taxes Total

Shares Amount

Three months ended March 31, 2024

Balance at January 1, 2024 16,158,413 $ 217,498 $ 274,570 $ ( 53,006 ) $ 439,062

Three months ended June 30, 2024

Balance at April 1, 2024 16,285,786 $ 218,342 $ 273,450 $ ( 55,112 ) $ 436,680

Net loss — — ( 21,902 ) — ( 21,902 )

Other comprehensive income, net of tax — — — 23,805 23,805

Stock issued under employee stock purchase plan 751 12 — — 12

Restricted stock surrendered for tax withholdings upon vesting ( 166 ) ( 3 ) — — ( 3 )

Restricted stock forfeited / cancelled ( 8,111 ) — — — —

Stock-based compensation - stock options — 20 — — 20

Stock-based compensation - restricted stock — 402 — — 402

Cash dividends paid on common stock ($ 0.25 per share)

— — ( 4,071 ) — ( 4,071 )

Balance at June 30, 2024 16,278,260 $ 218,773 $ 247,477 $ ( 31,307 ) $ 434,943

Three months ended June 30, 2023

Balance at April 1, 2023 16,107,210 $ 215,965 $ 276,209 $ ( 62,000 ) $ 430,174

Net income — — 4,551 — 4,551

2 unchanged sentences

Stock issued under employee stock ownership plan 19,700 424 — — 424

Restricted stock surrendered for tax withholdings upon vesting ( 285 ) ( 4 ) — — ( 4 )

Restricted stock forfeited / cancelled ( 20,174 ) — — — —

Stock-based compensation - stock options — 21 — — 21

Stock-based compensation - restricted stock — 171 — — 171

Cash dividends paid on common stock ($ 0.25 per share)

— — ( 4,028 ) — ( 4,028 )

Balance at June 30, 2023 16,107,192 $ 216,589 $ 276,732 $ ( 69,380 ) $ 423,941

The accompanying notes are an integral part of these consolidated financial statements (unaudited).

BANK OF MARIN BANCORP

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

For the six months ended June 30, 2024 and 2023

(in thousands, except share data;

unaudited) Common Stock Retained

Earnings Accumulated Other

Comprehensive Loss,

Net of Taxes Total

Shares Amount

Six months ended June 30, 2024

Balance at January 1, 2024 16,158,413 $ 217,498 $ 274,570 $ ( 53,006 ) $ 439,062

Net loss — — ( 18,980 ) — ( 18,980 )

Other comprehensive income, net of tax — — — 21,699 21,699

Stock issued under employee stock purchase plan 1,372 22 — — 22

Stock issued under employee stock ownership plan 24,600 425 — — 425

Restricted stock granted 106,964 — — — —

6 unchanged sentences

Stock issued in payment of director fees 11,810 259 — — 259

Balance at March 31, 2024

Balance at June 30, 2024

16,278,260 $ 218,773 $ 247,477 $ ( 31,307 ) $ 434,943

Three months ended March 31, 2023

Six months ended June 30, 2023

Balance at January 1, 2023 16,029,138 $ 215,057 $ 270,781 $ ( 73,746 ) $ 412,092

6 unchanged sentences

Restricted stock surrendered for tax withholdings upon vesting ( 2,498 ) ( 70 ) — — ( 70 )

Restricted stock forfeited / cancelled ( 20,174 ) — — — —

Stock-based compensation - stock options — 137 — — 137

3 unchanged sentences

Stock issued in payment of director fees 4,612 150 — — 150

Balance at March 31, 2023

Balance at June 30, 2023

16,107,192 $ 216,589 $ 276,732 $ ( 69,380 ) $ 423,941

2 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the three months ended March 31, 2024 and 2023

For the six months ended June 30, 2024 and 2023

(in thousands;

1 unchanged sentence

Cash Flows from Operating Activities:

Net income $ 2,922 $ 9,440

Adjustments to reconcile net income to net cash provided by operating activities:

Net (loss) income $ ( 18,980 ) $ 13,991

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

Provision for credit losses on loans 5,550 850

7 unchanged sentences

Net change in deferred loan origination costs/fees 185 ( 588 )

Write-down of other real estate owned — 40

Loss on sale of investment securities 32,542 —

Depreciation and amortization 767 1,282

6 unchanged sentences

Cash Flows from Investing Activities:

Purchase of available-for-sale securities ( 18,987 ) —

Proceeds from sale of available-for-sale securities 292,627 —

Proceeds from paydowns/maturities of held-to-maturity securities 20,861 25,377

Proceeds from paydowns/maturities of available-for-sale securities 19,517 33,595

Increase (decrease) in loans receivable, net 18,690 ( 19,072 )

Decrease in loans receivable, net ( 8,854 ) ( 9,271 )

Purchase of bank-owned life insurance policies ( 1,210 ) —

Proceeds from bank-owned life insurance policies — 766

Purchase of premises and equipment ( 250 ) ( 1,823 )

19 unchanged sentences

Amortization of net unrealized loss on available-for-sale securities transferred to held-to-maturity $ 764 $ 914

Bank-owned life insurance benefit receivable $ — $ 765

Restricted cash 1

15 unchanged sentences

1) weighted average basic shares, 2) potentially dilutive weighted average common shares related to stock options and unvested restricted stock awards, and 3) weighted average diluted shares.

Basic earnings per share (“EPS”) are calculated by dividing net income by the weighted average number of common shares outstanding during each period, excluding unvested restricted stock awards.

Basic earnings (loss) per share (“EPS”) are calculated by dividing net income by the weighted average number of common shares outstanding during each period, excluding unvested restricted stock awards.

Diluted EPS are calculated using the weighted average number of potentially dilutive common shares.

6 unchanged sentences

Under the two-class method, the difference in EPS is nominal for these participating securities.

Three months ended

(in thousands, except per share data) March 31, 2024 March 31, 2023

Three months ended Six months ended

(in thousands, except per share data) June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Weighted average basic common shares outstanding 16,108 16,009 16,095 15,990

3 unchanged sentences

Weighted average diluted common shares outstanding 16,108 16,016 16,095 16,008

Net income $ 2,922 $ 9,440

Basic EPS $ 0.18 $ 0.59

Diluted EPS $ 0.18 $ 0.59

Net (loss) income

$ ( 21,902 ) $ 4,551 $ ( 18,980 ) $ 13,991

Basic (loss) earnings per common share

$ ( 1.36 ) $ 0.28 $ ( 1.18 ) $ 0.88

Diluted (loss) earnings per common share 1

$ ( 1.36 ) $ 0.28 $ ( 1.18 ) $ 0.87

Weighted average anti-dilutive common shares not included in the calculation of diluted EPS 393 389 325 358

1 Because Bancorp was in a net loss position for the three and six months ended June 30, 2024, diluted net loss per share is the same as basic net loss per share, as the inclusion of potentially dilutive common shares would have been anti-dilutive.

Recently Adopted and Issued Accounting Standards

4 unchanged sentences

The amendment reduces diversity in practice by clarifying that a separate contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value.

In addition, this ASU provided amended examples to illustrate that a restriction that is a characteristic of the equity security, which market participants would take into account when pricing them, would be considered in measuring fair value.

In addition, this ASU

provided amended examples to illustrate that a restriction that is a characteristic of the equity security, which market participants would take into account when pricing them, would be considered in measuring fair value.

This ASU also introduced new disclosure requirements.

The amendments were effective prospectively for years beginning after

December 15, 2023.

The amendments were effective prospectively for years beginning after December 15, 2023.

As discussed in Note 4, Investment Securities, in 2023 we sold our remaining shares of Visa Inc.

47 unchanged sentences

Changes in Fair Value Recorded In 1

March 31, 2024

June 30, 2024

Securities available-for-sale:

7 unchanged sentences

Derivative financial assets (interest rate contracts) $ 551 $ — $ 551 $ — NI

Derivative financial liabilities (interest rate contracts) $ 142 $ — $ 142 $ — NI

December 31, 2023

17 unchanged sentences

agencies or government-sponsored agencies' debt securities, mortgage-backed securities, government agency-issued securities, and corporate bonds.

As of March 31, 2024 and December 31, 2023, there were no Level 3 securities.

As of June 30, 2024 and December 31, 2023, there were no Level 3 securities.

Held-to-maturity securities may be subject to an allowance for credit losses as a result of our evaluation of expected losses due to credit quality factors.

We did not record any credit loss expense on held-to-maturity securities during the three months ended March 31, 2024 or March 31, 2023.

We did not record any credit loss expense on held-to-maturity securities during the six months ended June 30, 2024 or June 30, 2023.

Fair value of held-to-maturity securities is determined using the same techniques discussed above for available-for-sale securities.

16 unchanged sentences

Disclosures about Fair Value of Financial Instruments

The table below is a summary of fair value estimates for financial instruments as of March 31, 2024 and December 31, 2023, excluding financial instruments recorded at fair value on a recurring basis (summarized in the first table in this note).

The table below is a summary of fair value estimates for financial instruments as of June 30, 2024 and December 31, 2023, excluding financial instruments recorded at fair value on a recurring basis (summarized in the first table in this note).

The carrying amounts in the following table are recorded in the consolidated statements of condition under the indicated captions.

Further, we have not disclosed the fair value of financial instruments specifically excluded from disclosure requirements such as bank-owned life insurance policies ("BOLI"), lease obligations and non-maturity deposit liabilities.

Additionally, we held shares of Federal Home Loan Bank ("FHLB") of San Francisco stock at cost as of March 31, 2024 and December 31, 2023.

There were no impairments or changes resulting from observable price changes in orderly transactions for the identical or similar investments of the same issuer as of March 31, 2024 or December 31, 2023.

Additionally, we held shares of Federal Home Loan Bank ("FHLB") of San Francisco stock at cost as of June 30, 2024 and March 31, 2024.

There were no impairments or changes resulting from observable price changes in orderly transactions for the identical or similar investments of the same issuer as of June 30, 2024 or December 31, 2023.

See further discussion on values within Note 4, Investment Securities.

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

(in thousands) Carrying Amounts Fair Value Fair Value Hierarchy Carrying Amounts Fair Value Fair Value Hierarchy

13 unchanged sentences

The value of off-balance-sheet financial instruments is estimated based on the fee income associated with the commitments, which in the absence of credit exposure, is considered to approximate their settlement value.

The fair value of commitment fees was not material as of March 31, 2024 or December 31, 2023.

The fair value of commitment fees was not material as of June 30, 2024 or December 31, 2023.

Investment Securities

5 unchanged sentences

We also invest in residential and commercial mortgage-backed securities (“MBS”/"CMBS") and collateralized mortgage obligations (“CMOs”) issued or guaranteed by the GSEs, as reflected in the following table.

A summary of the amortized cost, fair value and allowance for credit losses related to securities held-to-maturity as of March 31, 2024 and December 31, 2023 is presented below.

A summary of the amortized cost, fair value and allowance for credit losses related to securities held-to-maturity as of June 30, 2024 and December 31, 2023 is presented below.

Held-to-maturity:

2 unchanged sentences

(in thousands) Gains (Losses)

March 31, 2024

June 30, 2024

Securities of U.S.

22 unchanged sentences

Total held-to-maturity $ 925,198 $ — $ 925,198 $ 75 $ ( 110,443 ) $ 814,830

1 Amortized cost and fair values exclude accrued interest receivable of $ 2.5 million and $ 3.6 million at March 31, 2024 and December 31, 2023, respectively, which is included in interest receivable and other assets in the consolidated statements of condition.

1 Amortized cost and fair values exclude accrued interest receivable of $ 3.5 million and $ 3.6 million at June 30, 2024 and December 31, 2023, respectively, which is included in interest receivable and other assets in the consolidated statements of condition.

Management measures expected credit losses on held-to-maturity securities collectively by major security type with each type sharing similar risk characteristics, and considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts.

4 unchanged sentences

Based on the comprehensive anal ysis, no cred it losses are expected.

The following table summarizes the amortized cost of our portfolio of held-to-maturity securities issued by states and political subdivisions and corporate bonds by Moody's and/or Standard & Poor's bond ratings as of March 31, 2024 and December 31, 2023.

Obligations of state and political subdivisions Corporate bonds

(in thousands) March 31, 2024 December 31, 2023 March 31, 2024 December 31, 2023

(in thousands) June 30, 2024 December 31, 2023 June 30, 2024 December 31, 2023

Aaa / AAA $ 42,370 $ 42,577 $ — $ —

2 unchanged sentences

Total $ 61,798 $ 62,034 $ 30,000 $ 30,000

A summary of the amortized cost, fair value and allowance for credit losses related to securities available-for-sale as of March 31, 2024 and December 31, 2023 is presented below.

A summary of the amortized cost, fair value and allowance for credit losses related to securities available-for-sale as of June 30, 2024 and December 31, 2023 is presented below.

Available-for-sale:

2 unchanged sentences

(in thousands) Gains (Losses)

March 31, 2024

June 30, 2024

Securities of U.S.

23 unchanged sentences

Total available-for-sale $ 613,479 $ 3 $ ( 61,454 ) $ — $ 552,028

1 Amortized cost and fair value exclude accrued interest receivable of $ 2.3 million and $ 2.3 million at March 31, 2024 and December 31, 2023, respectively, which is included in interest receivable and other assets in the consolidated statements of condition.

The amortized cost a nd fair value of investment debt securities by contractual maturity at March 31, 2024 and December 31, 2023 are shown below.

1 Amortized cost and fair value exclude accrued interest receivable of $ 1.3 million and $ 2.3 million at June 30, 2024 and December 31, 2023, respectively, which is included in interest receivable and other assets in the consolidated statements of condition.

The amortized cost a nd fair value of investment debt securities by contractual maturity at June 30, 2024 and December 31, 2023 are shown below.

Expected maturities may differ from contractual maturities if the issuers of the securities have the right to call or prepay obligations with or without call or prepayment penalties.

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Held-to-Maturity Available-for-Sale Held-to-Maturity Available-for-Sale

5 unchanged sentences

Total $ 904,610 $ 783,397 $ 285,835 $ 252,917 $ 925,198 $ 814,830 $ 613,479 $ 552,028

There were no sales of investment securities in the first quarter of 2024 or 2023.

Three months ended

Sales of investment securities and gross gains and losses are shown in the following table:

Three months ended Six months ended

(in thousands) June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Available-for-sale:

Sales proceeds $ 292,627 $ — $ 292,627 $ —

Gross realized gains — — — —

Gross realized losses ( 32,542 ) — ( 32,542 ) —

The reported values of pledged investment securities are shown in the following table.

(in thousands) March 31, 2024 December 31, 2023

(in thousands) June 30, 2024 December 31, 2023

Pledged to the State of California:

8 unchanged sentences

Total pledged investment securities $ 916,331 $ 938,959

There were 317 and 313 securities in unrealized loss positions at March 31, 2024 and December 31, 2023, respectively.

There were 258 and 313 securities in unrealized loss positions at June 30, 2024 and December 31, 2023, respectively.

Those securities are summarized and classified according to the duration of the loss period in the tables below:

March 31, 2024 < 12 continuous months ≥ 12 continuous months Total securities

June 30, 2024 < 12 continuous months ≥ 12 continuous months Total securities

in a loss position

47 unchanged sentences

Total securities at loss position $ 64,025 $ ( 684 ) $ 1,287,979 $ ( 171,213 ) $ 1,352,004 $ ( 171,897 )

As of March 31, 2024, the investment portfolio included 306 investment securities that had been in a continuous loss position for twelve months or more and 11 investment securities that had been in a loss position for less than twelve months.

As of June 30, 2024, the investment portfolio included 248 investment securities that had been in a continuous loss position for twelve months or more and 10 investment securities that had been in a loss position for less than twelve months.

Securities issued by government-sponsored agencies, such as FNMA and FHLMC, usually have implicit credit support from the U.S.

5 unchanged sentences

Our investments in obligations of state and political subdivision bonds are deemed creditworthy after our comprehensive analysis of the issuers' latest financial information, credit ratings by major credit agencies, and/or credit enhancements.

No allowances for credit losses have been recognized on available-for-sale securities in an unrealized loss position, as management does not believe any of the securities are impaired due to credit risk factors at either March 31, 2024 or December 31, 2023.

In addition, for any available-for-sale securities in an unrealized loss position at March 31, 2024 and December 31, 2023, the Bank assessed whether it intended to sell the securities, or if it was more likely than not that it would be required to sell the securities before recovery of its amortized cost basis, which would require a write-down to fair value through net income.

In addition, for any available-for-sale securities in an unrealized loss position at June 30, 2024 and December 31, 2023, the Bank assessed whether it intended to sell the securities, or if it was more likely than not that it would be required to sell the securities before recovery of its amortized cost basis, which would require a write-down to fair value through net income.

Because the Bank did not intend to sell those securities that were in an unrealized loss position, and it was not more-likely-than-not that the Bank would be required to sell the securities before recovery of their amortized cost bases, the Bank determined that no write-down was necessary as of the reporting date.

7 unchanged sentences

Shares cannot be purchased or sold except between the FHLB and its members at the $ 100 per share par value.

We held $ 16.7 million of FHLB stock included in other assets on the consolidated statements of condition at both March 31, 2024 and December 31, 2023.

We held $ 16.7 million of FHLB stock included in other assets on the consolidated statements of condition at both June 30, 2024 and December 31, 2023.

The carrying amounts of these investments are reasonable estimates of fair value because the securities are restricted to member banks and they do not have a readily determinable market value.

Based on our analysis of FHLB's financial condition and certain qualitative factors, we determined that the FHLB stock w as not im paired at March 31, 2024 and December 31, 2023.

On April 25, 2024, FHLB announced a cash dividend for the first quarter of 2024 at an annualized dividend rate of 8.25 % to be distributed in mid-May 2024.

Based on our analysis of FHLB's financial condition and certain qualitative factors, we determined that the FHLB stock w as not im paired at June 30, 2024 and December 31, 2023.

On July 25, 2024, F HLB announced a cash dividend for the second quarter of 2024 at an annualized dividend rate of 8.75 % to be distributed in mid-August 2024.

Cash dividends paid on FHLB capital stock are recorded as non-interest income.

1 unchanged sentence

Low Income Housing Tax Credits

We invest in low-income housing tax credit funds as a limited partner, which totaled $ 1.9 million and $ 2.0 million recorded in other assets as of March 31, 2024 and December 31, 2023, respectively.

In the first three months of 2024, we recognized $ 133 thousand of low-income housing tax credits and other tax benefits, offset by $ 111 thousand of amortization expense of low-income housing tax credit investment, as a component of income tax expense.

As of March 31, 2024, our unfunded commitments for these low-income housing tax credit funds totaled $ 343 thousand.

We did not recognize any impairment losses on these low-income housing tax credit investments during the first three months of 2024 or 2023, as the value of the future tax benefits exceeds the carrying value of the investments.

We invest in low-income housing tax credit funds as a limited partner, which totaled $ 1.8 million and $ 2.0 million recorded in other assets as of June 30, 2024 and December 31, 2023, respectively.

In the first six months of 2024, we recognized $ 263 thousand of low-income housing tax credits and other tax benefits, offset by $ 219 thousand of amortization expense of low-income housing tax credit investment, as a component of income tax expense.

As of June 30, 2024, our unfunded commitments for these low-income housing tax credit funds totaled $ 343 thousand.

We did not recognize any impairment losses on these low-income housing tax credit investments during the first six months of 2024 or 2023, as the value of the future tax benefits exceeds the carrying value of the investments.

Loans and Allowance for Credit Losses on Loans

The following table presents the amortized cost of loans by portfolio class as of March 31, 2024 and December 31, 2023.

(in thousands) March 31, 2024 December 31, 2023

The following table presents the amortized cost of loans by portfolio class as of June 30, 2024 and December 31, 2023.

(in thousands) June 30, 2024 December 31, 2023

Commercial and industrial $ 169,247 $ 153,750

9 unchanged sentences

Total loans, net of allowance for credit losses on loans $ 2,051,724 $ 2,048,548

1 Amortized cost includes net deferred loan origination costs of $ 2.6 million and $ 2.7 million at March 31, 2024 and December 31, 2023, respectively.

Amounts are also net of unrecognized purchase discounts of $ 1.9 million and $ 2.0 million at March 31, 2024 and December 31, 2023, respectively.

Amortized cost excludes accrued interest, which totaled $ 6.3 million and $ 6.6 million at March 31, 2024 and December 31, 2023, respectively, and is included in interest receivable and other assets in the consolidated statements of condition.

1 Amortized cost includes net deferred loan origination costs of $ 2.5 million and $ 2.7 million at June 30, 2024 and December 31, 2023, respectively.

Amounts are also net of unrecognized purchase discounts of $ 1.9 million and $ 2.0 million at June 30, 2024 and December 31, 2023, respectively.

Amortized cost excludes accrued interest, which totaled $ 7.0 million and $ 6.6 million at June 30, 2024 and December 31, 2023, respectively, and is included in interest receivable and other assets in the consolidated statements of condition.

Lending Risks

Commercial and Industrial Loans - Commercial loans are generally made to established small and mid-sized businesses to provide financing for their growth and working capital needs, equipment purchases and acquisitions.

Management examines historical, current, and projected cash flows to determine the ability of the

borrower to repay obligations as agreed.

Commercial loans are made based primarily on the identified cash flows of the borrower and secondarily on the underlying collateral and guarantor support.

Management examines historical, current, and projected cash flows to determine the ability of the borrower to repay obligations as agreed.

Commercial loans are made based primarily on the identified cash flows

of the borrower and secondarily on the underlying collateral and guarantor support.

The cash flows of borrowers, however, may not occur as expected, and the collateral securing these loans may fluctuate in value.

12 unchanged sentences

Construction loans include interest reserves that are used for the payment of interest during the development and marketing periods and are capitalized as part of the loan balance.

When a construction loan is placed on nonaccrual status before the depletion of the interest reserve, we apply the interest funded by the interest reserve against the loan's principal balance.

When a construction loan is placed on non-accrual status before the depletion of the interest reserve, we apply the interest funded by the interest reserve against the loan's principal balance.

These loans are underwritten after evaluation of the borrower's financial strength, reputation, prior track record, and independent appraisals.

45 unchanged sentences

We also review loans graded “Watch” or worse, regardless of loan type, no less than quarterly.

The following tables present the loan portfolio by loan portfolio class, origination/renewal year and internal risk rating as of March 31, 2024 and December 31, 2023.

The following tables present the loan portfolio by loan portfolio class, origination/renewal year and internal risk rating as of June 30, 2024 and December 31, 2023.

The current year vintage table reflects gross charge-offs by loan portfolio class and year of origination.

2 unchanged sentences

(in thousands) Term Loans - Amortized Cost by Origination Year Revolving Loans Amortized Cost

March 31, 2024 2024 2023 2022 2021 2020 Prior Total

June 30, 2024 2024 2023 2022 2021 2020 Prior Total

Commercial and industrial:

15 unchanged sentences

(in thousands) Term Loans - Amortized Cost by Origination Year Revolving Loans Amortized Cost

March 31, 2024 2024 2023 2022 2021 2020 Prior Total

June 30, 2024 2024 2023 2022 2021 2020 Prior Total

Construction:

52 unchanged sentences

Totals $ 183,397 $ 291,859 $ 320,078 $ 264,689 $ 239,856 $ 610,122 $ 163,719 $ 2,073,720

The following table shows the amortized cost of loans by portfolio class, payment aging and non-accrual status as of March 31, 2024 and December 31, 2023.

The following table shows the amortized cost of loans by portfolio class, payment aging and non-accrual status as of June 30, 2024 and December 31, 2023.

Loan Aging Analysis by Class

(in thousands) Commercial and industrial Commercial real estate, owner-occupied Commercial real estate, non-owner occupied Construction Home equity Other residential Installment and other consumer Total

March 31, 2024

June 30, 2024

30-59 days past due $ 9 $ 709 $ — $ — $ 810 $ — $ 646 $ 2,174

21 unchanged sentences

Non-accrual loans with no allowance $ 1,311 $ 434 $ 877 $ — $ 469 $ — $ — $ 3,091

1 There was one non-owner occupied commercial real estate loan 90 days past due and accruing interest as of March 31, 2024 that has been in extended renewal negotiations, but it is well-secured and expected to be restored to a current payment status in the near future.

1 There was one non-owner occupied commercial real estate loan 90 days past due and accruing interest as of June 30, 2024 that has been in extended renewal negotiations, but it is well-secured and expected to be restored to a current payment status in the near future.

There were no non-performing loans over 90 days past due and accruing interest as of December 31, 2023 .

2 None of the non-accrual loans as of March 31, 2024 or December 31, 2023 were earning interest on a cash or accrual basis.

We reversed $ 10 thousand in accrued interest income for loans that were placed on non-accrual status during the three months ended March 31, 2024.

We reversed accrued interest income of $ 16 thousand for loans that were placed on non-accrual status during the three months ended March 31, 2023.

2 None of the non-accrual loans as of June 30, 2024 or December 31, 2023 were earning interest on a cash or accrual basis.

We reversed $ 266 thousand in accrued interest income for loans that were placed on non-accrual status during the six months ended June 30, 2024.

We reversed accrued interest income of $ 14 thousand for loans that were placed on non-accrual status during the six months ended June 30, 2023.

Collateral Dependent Loans

The following table presents the amortized cost basis of individually analyzed collateral-dependent loans, which were all on non-accrual status, by portfolio class at March 31, 2024 and December 31, 2023.

The following table presents the amortized cost basis of individually analyzed collateral-dependent loans, which were all on non-accrual status, by portfolio class at June 30, 2024 and December 31, 2023.

Amortized Cost by Collateral Type

1 unchanged sentence

Allowance for Credit Losses

March 31, 2024

June 30, 2024

Commercial real estate, owner-occupied $ 1,306 $ — $ — $ — $ 1,306 $ —

9 unchanged sentences

Total $ 4,826 $ 469 $ — $ — $ 5,295 $ 408

1 There were no collateral-dependent residential real estate mortgage loans in process of foreclosure or in substance repossessed at March 31, 2024 and December 31, 2023.

The weighted average loan-to-value of real estate secured collateral dependent loans was approximately 82 % at March 31, 2024 and 70 % at December 31, 2023.

1 There were no collateral-dependent residential real estate mortgage loans in process of foreclosure or in substance repossessed at June 30, 2024 and December 31, 2023.

The weighted average loan-to-value of real estate secured collateral dependent loans was approximately 130 % ( 82 % net of individual reserves for credit losses) at June 30, 2024 and 70 % ( 62 % net of individual reserves for credit losses) at December 31, 2023.

Loan Modifications to Borrowers Experiencing Financial Difficulty

The following table summarizes the amortized cost of loans as of March 31, 2024 that were modified during the three months ended March 31, 2024 by portfolio class and type of modification granted.

There were no modifications of loans during the three months ended March 31, 2023 requiring disclosure.

(in thousands) Term Extension Percent of Portfolio Class Total

Three months ended March 31, 2024

The following table summarizes the amortized cost of loans as of June 30, 2024 that were modified during the three and six months ended June 30, 2024 by portfolio class and type of modification granted.

There were no modifications of loans during the three and six months ended June 30, 2023 requiring disclosure.

(in thousands) Term Extension Total Modifications Percent of Portfolio Class Total

Three months ended June 30, 2024

Home equity $ 159 $ 159 0.2 %

Six months ended June 30, 2024

Commercial and industrial $ 2,191 $ 2,191 1.3 %

Home equity 241 241 0.3 %

As of March 31, 2024, there were no unfunded loan commitments for loans that were modified during the period presented.

The following table summarizes the financial effect of loan modifications presented in the table above during the three months ended March 31, 2024 by portfolio class.

$ 2,432 $ 2,432

As of June 30, 2024, there were no unfunded loan commitments for loans that were modified during the period presented.

The following table summarizes the financial effect of loan modifications presented in the table above during the three and six months ended June 30, 2024 by portfolio class.

(in thousands) Weighted-Average Term Extension (in years)

Three months ended March 31, 2024

Three months ended June 30, 2024

Home equity 1.0

Six months ended June 30, 2024

Commercial and industrial 0.3

Home equity 5.6

The loan modifications did not significantly impact the determination of the allowance for credit losses on loans during the three months ended March 31, 2024.

The loan modifications did not significantly impact the determination of the allowance for credit losses on loans during the three and six months ended June 30, 2024.

The Bank closely monitors the performance of the modified loans to understand the effectiveness of its modification efforts.

The following table summarizes the amortized cost and payment status of loans as of March 31, 2024 that were modified during the three months ended March 31, 2024 by portfolio class.

The following table summarizes the amortized cost and payment status of loans as of June 30, 2024 that were modified during the three and six months ended June 30, 2024 by portfolio class.

(in thousands) Current 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due Total Non-Accrual

Three months ended March 31, 2024

Three months ended June 30, 2024

Home equity $ 159 $ — $ — $ — $ 159 $ 120

$ 159 $ — $ — $ — $ 159 $ 120

Six months ended June 30, 2024

Commercial and industrial $ — $ — $ 1,796 $ — $ 1,796 $ 1,796

1 unchanged sentence

$ 238 $ — $ 1,796 $ — $ 2,034 $ 1,995

There were no loans that defaulted (fully or partially charged-off or became 90 days or more past due) that were modified during the three months ended March 31, 2024.

There were no loans that defaulted (fully or partially charged-off or became 90 days or more past due) that were modified during the three and six months ended June 30, 2024.

Allocation of the Allowance for Credit Losses on Loans

The following table presents the details of the allowance for credit losses on loans segregated by loan portfolio class as of March 31, 2024 and December 31, 2023 .

The following table presents the details of the allowance for credit losses on loans segregated by loan portfolio class as of June 30, 2024 and December 31, 2023 .

Allocation of the Allowance for Credit Losses on Loans

March 31, 2024

June 30, 2024

Modeled expected credit losses $ 959 $ 1,279 $ 7,672 $ 57 $ 583 $ 757 $ 648 $ — $ 11,955

11 unchanged sentences

Three months ended March 31, 2024

Three months ended June 30, 2024

Beginning balance $ 1,727 $ 2,500 $ 15,704 $ 1,282 $ 627 $ 692 $ 920 $ 2,049 $ 25,501

Provision (Reversal) 177 ( 92 ) 6,461 ( 408 ) 23 77 ( 12 ) ( 1,026 ) 5,200

(Charge-offs) ( 29 ) — — — — — ( 1 ) — ( 30 )

Recoveries 1 — — — — — 3 — 4

Ending balance $ 1,876 $ 2,408 $ 22,165 $ 874 $ 650 $ 769 $ 910 $ 1,023 $ 30,675

Three months ended June 30, 2023

Beginning balance $ 1,941 $ 2,640 $ 12,701 $ 2,019 $ 538 $ 577 $ 882 $ 2,032 $ 23,330

(Reversal) Provision ( 111 ) ( 51 ) 500 ( 86 ) 23 22 66 137 500

2 unchanged sentences

Ending balance $ 1,831 $ 2,589 $ 13,201 $ 1,942 $ 561 $ 599 $ 940 $ 2,169 $ 23,832

Three months ended March 31, 2023

Allowance for Credit Losses on Loans Rollforward

Six months ended June 30, 2024

Beginning balance $ 1,712 $ 2,476 $ 14,933 $ 1,832 $ 552 $ 653 $ 976 $ 2,038 $ 25,172

3 unchanged sentences

Ending balance $ 1,876 $ 2,408 $ 22,165 $ 874 $ 650 $ 769 $ 910 $ 1,023 $ 30,675

Six months ended June 30, 2023

Beginning balance $ 1,794 $ 2,487 $ 12,676 $ 1,937 $ 558 $ 595 $ 868 $ 2,068 $ 22,983

Provision (Reversal) 36 102 525 ( 12 ) 3 4 91 101 850

(Charge-offs) ( 3 ) — — — — — ( 20 ) — ( 23 )

Recoveries 4 — — 17 — — 1 — 22

Ending balance $ 1,831 $ 2,589 $ 13,201 $ 1,942 $ 561 $ 599 $ 940 $ 2,169 $ 23,832

Pledged Loans

Our FHLB line of credit is secured under terms of a blanket collateral agreement by a pledge of certain qualifying loans with unpaid principal balances of $ 1.299 billion and $ 1.288 billion at March 31, 2024 and December 31, 2023, respectively.

In addition, we pledge eligible TIC loans, which totaled $ 108.5 million and $ 110.4 million at March 31, 2024 and December 31, 2023, respectively, to secure our borrowing capacity with the Federal Reserve Bank ("FRB").

Our FHLB line of credit is secured under terms of a blanket collateral agreement by a pledge of certain qualifying loans with unpaid principal balances of $ 1.296 billion and $ 1.288 billion at June 30, 2024 and December 31, 2023, respectively.

In addition, we pledge eligible residential loans, which totaled $ 109.4 million and $ 110.4 million at June 30, 2024 and December 31, 2023, respectively, to secure our borrowing capacity with the Federal Reserve Bank ("FRB").

For additional information, see Note 6, Borrowings.

3 unchanged sentences

Likewise, these transactions do not involve more than the normal risk of collectability or present other unfavorable features.

The following table shows changes in net loans to related parties for each of the three years ended March 31, 2024.

Related party loans totaled $ 5.8 million as of both March 31, 2024 and December 31, 2023.

In addition, undisbursed commitments to related parties totaled $ 212 thousand as of both March 31, 2024 and December 31, 2023.

Related party loans totaled $ 5.7 million and $ 5.8 million as of June 30, 2024 and December 31, 2023, respectively.

In addition, undisbursed commitments to related parties totaled $ 211 thousand and $ 212 thousand as of June 30, 2024 and December 31, 2023, respectively.

Borrowings and Other Obligations

Federal Home Loan Bank:

The Bank had lines of credit with the FHLB totaling $ 951.2 million and $ 1.009 billion as of March 31, 2024 and December 31, 2023, respectively, based on eligible collateral of certain loans and investment securities.

The Bank had lines of credit with the FHLB totaling $ 941.7 million and $ 1.009 billion as of June 30, 2024 and December 31, 2023, respectively, based on eligible collateral of certain loans and investment securities.

Federal Funds Lines of Credit:

The Bank had unsecured lines of credit with correspondent banks for overnight borrowings totaling $ 125.0 million and $ 135.0 million as of March 31, 2024 and December 31, 2023, respectively.

The Bank had unsecured lines of credit with correspondent banks for overnight borrowings totaling $ 125.0 million and $ 135.0 million as of June 30, 2024 and December 31, 2023, respectively.

In general, interest rates on these lines approximate the federal funds target rate.

Federal Reserve Bank:

The Bank had a line of credit through the Discount Window at the Federal Reserve Bank of San Francisco ("FRBSF") totaling $ 350.0 million as of March 31, 2024, secured by investment securities and residential loans.

The Bank had a line of credit through the Discount Window at the Federal Reserve Bank of San Francisco ("FRBSF") totaling $ 335.4 million as of June 30, 2024, secured by investment securities and residential loans.

As of December 31, 2023, the Bank had a line of credit through the Discount Window totaling $ 64.0 million, secured by residential loans, and a $ 270.2 million line under the Federal Reserve's temporary Bank Term Funding Program ("BTFP") based on the par values of pledged investment securities.

When the BTFP program ended on March 11, 2024, the investment securities were used to collateralize borrowings through the Discount Window .

When the BTFP program ended on March 11, 2024, the investment securities were reallocated to our borrowing facility through the Discount Window .

Other Obligations:

Finance lease liabilities totaling $ 260 thousand and $ 298 thousand as of March 31, 2024 and December 31, 2023, respectively, are included in borrowings and other obligations in the consolidated statements of condition.

Finance lease liabilities totaling $ 231 thousand and $ 298 thousand as of June 30, 2024 and December 31, 2023, respectively, are included in borrowings and other obligations in the consolidated statements of condition.

Refer to Note 8, Commitments and Contingencies, for additional information.

The carrying values and weighted average interest rates on borrowings and other obligations as of March 31, 2024 and December 31, 2023 are summarized in the following table.

March 31, 2024 December 31, 2023

The carrying values and weighted average interest rates on borrowings and other obligations as of June 30, 2024 and December 31, 2023 are summarized in the following table.

June 30, 2024 December 31, 2023

(dollars in thousands) Carrying Value

9 unchanged sentences

Stockholders' Equity

On January 25, 2024, Bancorp declared a $ 0.25 per share cash dividend, paid February 15, 2024 to shareholders of record at the close of business on February 8, 2024.

Subsequent to quarter end on April 25, 2024, Bancorp declared a $ 0.25 per share cash dividend, payable on May 16, 2024 to shareholders of record at the close of business on May 9, 2024.

On April 25, 2024, Bancorp approved a $ 0.25 per share cash dividend, paid May 16, 2024 to shareholders of record at the close of business on May 9, 2024.

Subsequent to quarter end on July 25, 2024, Bancorp approved a $ 0.25 per share cash dividend, payable on August 15, 2024 to shareholders of record at the close of business on August 8, 2024.

Share-Based Payments

18 unchanged sentences

The table below depicts the total number of shares, amount, and weighted average price withheld for cashless exercises for the periods presented.

Three Months Ended

March 31, 2024 March 31, 2023

Six Months Ended

June 30, 2024 June 30, 2023

Number of shares withheld 3,504 3,132

3 unchanged sentences

On July 21, 2023, the Board of Directors approved the adoption of Bancorp's new share repurchase program for up to $ 25.0 million and expiring on July 31, 2025.

There have been no repurchases to date in 2024 or in 2023.

There were no repurchases through June 30, 2024 or in the 2023

year, however the Bank began repurchasing shares in August 2024 and will continue to assess opportunities to utilize the program.

Commitments and Contingent Liabilities

10 unchanged sentences

The contractual amount of unfunded loan commitments and standby letters of credit not reflected in the consolidated statements of condition are as follows:

(in thousands) March 31, 2024 December 31, 2023

(in thousands) June 30, 2024 December 31, 2023

Commercial lines of credit $ 233,333 $ 259,989

5 unchanged sentences

We record an allowance for credit losses on unfunded loan commitments at the balance sheet date based on estimates of the probability that these commitments will be drawn upon according to historical utilization experience of the different types of commitments and expected loss rates determined for pooled funded loans.

The allowance for credit losses on unfunded commitments totaled $ 1.1 million at both March 31, 2024 and December 31, 2023, which is included in interest payable and other liabilities in the consolidated statements of condition.

There was no provision for credit losses on unfunded loan commitments in the first quarter of 2024.

The $ 174 thousand reversal of the provision for credit losses on unfunded loan commitments in the first quarter of 2023 was due primarily to a $ 37.4 million decrease in total unfunded commitments.

We lease premises under long-term non-cancelable operating leases with remaining terms of 30 days to 18 years, 5 months , most of which include escalation clauses and one or more options to extend the lease term, and some of

which contain lease termination clauses.

The allowance for credit losses on unfunded commitments totaled $ 1.1 million at both June 30, 2024 and December 31, 2023, which is included in interest payable and other liabilities in the consolidated statements of condition.

There was no provision for credit losses on unfunded loan commitments in the second quarter of 2024 or six month period ended June 30, 2024.

The $ 168 thousand reversal of the provision for credit losses on unfunded loan commitments in the second quarter of 2023 was due primarily to a $ 39.9 million decrease in total unfunded commitments.

The $ 342 thousand reversal of the provision for credit losses on unfunded loan commitments in the first half of 2023 was due primarily to a $ 77.3 million decrease in total unfunded commitments.

We lease premises under long-term non-cancelable operating leases with remaining terms of 31 days to 17 years, 11 months , most of which include escalation clauses and one or more options to extend the lease term, and some of which contain lease termination clauses.

Lease terms may include certain renewal options that were considered reasonably certain to be exercised.

2 unchanged sentences

The following table shows the balances of operating and finance lease right-of-use assets and lease liabilities.

(in thousands) March 31, 2024 December 31, 2023

(in thousands) June 30, 2024 December 31, 2023

Operating leases:

9 unchanged sentences

The following table shows supplemental disclosures of noncash investing and financing activities for the periods presented.

Three months ended

(in thousands) March 31, 2024 March 31, 2023

Six months ended

(in thousands) June 30, 2024 June 30, 2023

Right-of-use assets obtained in exchange for operating lease liabilities

$ 2,417 $ 572

Right-of-use assets obtained in exchange for finance lease liabilities $ — $ 7

The following table shows components of operating and finance lease cost.

Three months ended

(in thousands) March 31, 2024 March 31, 2023

Three months ended Six months ended

(in thousands) June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Operating lease cost 1

2 unchanged sentences

Amortization of right-of-use assets 2

$ 37 $ 37 $ 73 $ 74

Interest on finance lease liabilities 3

4 unchanged sentences

3 Included in interest on borrowings and other obligations in the consolidated statements of comprehensive income.

The following table shows the future minimum lease payments, weighted average remaining lease terms, and weighted average discount rates under operating and finance lease arrangements as of March 31, 2024.

The discount rates used to calculate the present value of lease liabilities were based on the collateralized FHLB borrowing rates that were commensurate with lease terms and minimum payments on the lease commencement date.

(in thousands) March 31, 2024

(in thousands) June 30, 2024

Year Operating Leases Finance Leases

38 unchanged sentences

Asset derivatives Liability derivatives

(in thousands) March 31,

2024 December 31, 2023 March 31,

(in thousands) June 30,

2024 December 31, 2023 June 30,

2024 December 31, 2023

8 unchanged sentences

1 Refer to Note 3, Fair Value of Assets and Liabilities, for valuation methodology.

The following table presents the carrying amount and associated cumulative basis adjustment related to the application of fair value hedge accounting that is included in the carrying amount of hedged assets as of March 31, 2024 and December 31, 2023.

Carrying Amounts of Hedged Assets Cumulative Amounts of Fair Value Hedging Adjustments Included in the Carrying Amounts of the Hedged Assets

(in thousands) March 31, 2024 December 31, 2023 March 31, 2024 December 31, 2023

(in thousands) June 30, 2024 December 31, 2023 June 30, 2024 December 31, 2023

Available-for-sale securities 1

3 unchanged sentences

1 Carrying value equals the amortized cost basis of the securities underlying the hedge relationship, which is the book value net of the fair value hedge adjustment.

Amortized cost excludes accrued interest totaling $ 233 thousand and $ 222 thousand as of March 31, 2024 and December 31, 2023, respectively.

Amortized cost excludes accrued interest totaling $ 221 thousand and $ 222 thousand as of June 30, 2024 and December 31, 2023, respectively.

2 Carrying value equals the amortized cost basis of the loans underlying the hedge relationship, which is the loan balance net of deferred loan origination fees and cost and the fair value hedge adjustment.

1 unchanged sentence

The following table presents the pretax net gains (losses) recognized in interest income related to our fair value hedges for the years presented.

Three months ended

(in thousands) March 31, 2024 March 31, 2023

Three months ended Six months ended

(in thousands) June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Interest on investment securities 1

2 unchanged sentences

Decrease in carrying value included in the hedged available-for-sale securities

( 282 ) — ( 1,499 ) —

Net gain (loss) recognized in interest income on investment securities

Interest and fees on loans 1

Increase (decrease) in fair value of interest rate swaps hedging loans receivable

$ 206 $ — $ 412 $ —

Interest and fees on loans 1

Increase in fair value of interest rate swaps hedging loans receivable $ 11 $ 250 $ 126 $ 29

Hedged interest earned 54 66 109 118

(Decrease) increase in carrying value included in the hedged loans

Decrease in carrying value included in the hedged loans ( 6 ) ( 243 ) ( 117 ) ( 23 )

Decrease in value of yield maintenance agreement ( 2 ) ( 2 ) ( 4 ) ( 4 )

Net gain recognized in interest income on loans $ 57 $ 71 $ 114 $ 120

1 Represents the income line item in the statement of comprehensive income in which the effects of fair value hedges are recorded.

1 Represents the income line item in the statement of comprehensive loss in which the effects of fair value hedges are recorded.

Our derivative transactions with the counterparty are under an International Swaps and Derivative Association (“ISDA”) master agreement that includes “right of set-off” provisions.

9 unchanged sentences

Instruments Received Net Amount

March 31, 2024

June 30, 2024

$ 551 $ — $ 551 $ — $ — $ 551

9 unchanged sentences

Condition of Condition 1

Instruments Received Net Amount

March 31, 2024

142 — 142 ( 142 ) — —

Instruments Pledged

June 30, 2024

Total $ — $ — $ — $ — $ — $ —

5 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements