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Item 1. Financial Statements

2025-08-13 compared with 2025-05-13 · 304 added, 216 removed, 843 unchanged (38% of the section changed)

2 unchanged sentences

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

March 31, 2025

June 30, 2025

December 31, 2024

43 unchanged sentences

Stockholders’ Equity

Preferred stock $ 0.01 par value 1,000,000 shares authorized, none issued and outstanding at March 31, 2025 and December 31, 2024

Common stock $ 0.01 par value, 30,000,000 shares authorized, 13,008,964 issued and outstanding at March 31, 2025 and 13,059,175 at December 31, 2024

Preferred stock $ 0.01 par value 1,000,000 shares authorized, none issued and outstanding at June 30, 2025 and December 31, 2024

Common stock $ 0.01 par value, 30,000,000 shares authorized, 13,008,389 issued and outstanding at June 30, 2025 and 13,059,175 at December 31, 2024

130,083 130,592

3 unchanged sentences

90,961,990 90,006,648

Unearned ESOP shares ( 376,338 shares at March 31, 2025 and 382,933 shares at December 31, 2024)

Unearned ESOP shares ( 369,670 shares at June 30, 2025 and 382,933 shares at December 31, 2024)

( 4,369,992 ) ( 4,520,594 )

9 unchanged sentences

Three Months Ended

Six Months Ended

Interest income

6 unchanged sentences

Net interest income

(Recovery) provision for credit losses

Provision (recovery) for credit losses

Net interest income after (recovery) provision for credit losses

21 unchanged sentences

BOGOTA FINANCIAL CORP.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

Three Months Ended

Six Months Ended

Net income (loss)

Other comprehensive income (loss):

Net unrealized gain (loss) on securities available for sale:

Other comprehensive (loss) income:

Net unrealized (loss) gain on securities available for sale:

Defined benefit retirement plans:

1 unchanged sentence

Unrealized (loss) gain on swap contracts accounted for as cash flow hedges

Total other comprehensive income (loss)

Comprehensive income (loss)

Total other comprehensive (loss) income

Comprehensive (loss) income

See accompanying notes to unaudited consolidated financial statements.

4 unchanged sentences

Balance January 1, 2024

13,279,230 $ 132,792 $ 56,149,915 $ 92,177,068 $ ( 4,821,798 ) $ ( 6,464,774 ) $ 137,173,203

— — — ( 440,980 ) — — ( 440,980 )

Other comprehensive loss

— — — — — ( 300,572 ) ( 300,572 )

Restricted stock issuance

10,000 — — — — — —

Stock based compensation

— — 234,493 — — — 234,493

Stock purchased and retired

( 33,083 ) ( 331 ) ( 269,364 ) — — — ( 269,695 )

ESOP Shares released (6,447 shares)

— — ( 25,025 ) — 75,301 — 50,276

Balance March 31, 2024

13,256,147 132,461 56,090,019 91,736,088 ( 4,746,497 ) ( 6,765,346 ) $ 136,446,725

Other comprehensive income

Stock based compensation

Stock purchased and retired

ESOP Shares released (6,668 shares)

Balance June 30, 2024

Balance January 1, 2025

13,059,175 $ 130,592 $ 55,269,962 $ 90,006,648 $ ( 4,520,594 ) $ ( 3,597,448 ) $ 137,289,160

— — — 730,947 — — 730,947

Other comprehensive income

— — — — — 360,265 360,265

Stock based compensation

— — 221,180 — — — 221,180

Stock purchased and retired

( 50,211 ) ( 503 ) ( 397,712 ) — — — ( 398,215 )

ESOP shares released (6,595 shares)

— — ( 24,832 ) — 75,301 — 50,469

Balance March 31, 2025

13,008,964 $ 130,089 $ 55,068,598 $ 90,737,595 $ ( 4,445,293 ) $ ( 3,237,183 ) $ 138,253,806

Other comprehensive loss

Stock based compensation

Stock purchased and retired

ESOP shares released (6,668 shares)

Balance June 30, 2025

See accompanying notes to unaudited consolidated financial statements.

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the three months ended

For the six months ended

Cash flows from operating activities

1 unchanged sentence

Adjustments to reconcile net income (loss) to net cash used for operating activities:

Accretion of intangible assets

Amortization of intangible assets

(Recovery) provision for credit losses

Depreciation of premises and equipment

(Accretion) amortization of deferred loan (fees) costs, net

Amortization of deferred loan (fees) costs, net

Amortization of premiums and accretion of discounts on securities, net

Deferred income tax (benefit)

Deferred income benefit

Gain on sale of loans

24 unchanged sentences

Repurchase of common stock

Net (decrease) increase in advance payments from borrowers for taxes and insurance

Net increase in advance payments from borrowers for taxes and insurance

Net cash (used for) provided by financing activities

1 unchanged sentence

Cash and cash equivalents at beginning of year

Cash and cash equivalents at March 31,

Cash and cash equivalents at June 30,

Supplemental cash flow information

15 unchanged sentences

was formed to buy, sell and hold investment securities.

Bogota Properties, LLC was inactive at March 31, 2025 and December 31, 2024 .

Bogota Properties, LLC, formed to hold real estate owned by the Company, was inactive at June 30, 2025 and December 31, 2024 .

The Bank generally originates residential, commercial and consumer loans to, and accepts deposits from, customers in New Jersey.

3 unchanged sentences

Some items in the prior year financial statements were reclassified to conform to the current presentation.

Reclassifications had no effect on prior year net income or stockholders' equity.

Reclassifications had no effect on prior year net loss or stockholders' equity.

Earnings (Loss) per Share:

3 unchanged sentences

The potentially diluted shares would then be included in the weighted average number of shares outstanding for the period using the treasury stock method.

For the three months ended March 31, 2025 and March 31, 2024 , options to purchase 508,619 and 523,619 c ommon shares, respectively, with an exercise price of $ 10.45 were outstanding but were not included in the computation of diluted earnings per common share because to do so would be anti-dilutive.

For the three and six months ended June 30, 2025 and June 30, 2024 , options to purchase 508,619 and 523,619 c ommon shares, respectively, with an exercise price of $ 10.45 were outstanding but were not included in the computation of diluted earnings per common share because to do so would be anti-dilutive.

Anti-dilutive options are those options with exercise prices in excess of the weighted average market value for the periods presented.

For the three months ended March 31, 2025 , 947 shares of outstanding non-vested stock were added in the computation of diluted earnings per share.

For the three months ended March 31, 2024 , a ll outstanding non-vested restricted stock were excluded from the computation of diluted earnings per share, because to include such shares would have been anti-dilutive.

The following is a reconciliation of the numerators and denominators of the basic and diluted earnings per share calculations for the three months ended March 31, 2025 and 2024 .

For the three months ended March 31, 2025

For the three months ended March 31, 2024

For the three and six months ended June 30, 2025 , 5,189 and 1,957 sha res of outstanding non-vested stock were added in the computation of diluted earnings per share.

The following is a reconciliation of the numerators and denominators of the basic and diluted earnings per share calculations for the three and six months ended June 30, 2025 and 2024 .

For the three months ended June 30, 2025 For the three months ended June 30, 2024 For the six months ended June 30, 2025 For the six months ended June 30, 2024

Net income (loss)

3 unchanged sentences

Effect of non-unvested restricted stock

5,189 — 1,957 —

Weighted average shares outstanding - diluted

17 unchanged sentences

The unaudited financial statements and other financial information contained in this Quarterly Report on Form 10 -Q should be read in conjunction with the audited financial statements, and related notes, of the Company at and for the year ended December 31, 2024 .

Segment Reporting :

The Company operates one reportable segment of business, “retail banking”.

Through its community banking segment, the Company provides a broad range of retail and commercial banking services.

The accounting policies of the retail banking segment are the same as those described in the summary of significant accounting policies.

The Company's chief operating decision maker ("CODM") is the President and Chief Executive Officer, who decides how to allocate resources based on net income that also is reported on the income statement as consolidated net income.

The measure of segment assets is reported on the balance sheet as total consolidated assets.

BOGOTA FINANCIAL CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Segment Reporting :

The Company operates one reportable segment of business, “retail banking.” Through its retail banking segment, the Company provides a broad range of retail and commercial banking services.

The accounting policies of the retail banking segment are the same as those described in the summary of significant accounting policies.

The measure of segment assets is reported on the statement of financial condition as total consolidated assets.

NOTE 2 – SECURITIES AVAILABLE FOR SALE

The following table summarizes the amortized cost, fair value, and gross unrealized gains and losses of securities available for sale, by contractual maturity, none of which had an allowance for credit losses at March 31, 2025 and December 31, 2024 :

March 31, 2025

June 30, 2025

government and agency obligations

41 unchanged sentences

$ 145,878,693 $ 543,015 $ ( 6,114,261 ) $ 140,307,447

All of the mortgaged-backed securities (“MBSs”) are issued by the following government sponsored agencies:

Federal Home Loan Mortgage Corporation (“FHLMC”), Federal National Mortgage Association (“FNMA”) and Government National Mortgage Association (“GNMA”).

There w ere no sales of securities during the three months ended March 31, 2025 or March 31, 2024 .

The age of unrealized losses and the fair value of related securities as of March 31, 2025 and December 31, 2024 were as follows:

All of the mortgaged-backed securities (“MBSs”) are issued by the Federal Home Loan Mortgage Corporation (“FHLMC”), Federal National Mortgage Association (“FNMA”) and Government National Mortgage Association.

There w ere no sales of securities during the three and six months ended June 30, 2025 or June 30, 2024 .

BOGOTA FINANCIAL CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The age of unrealized losses and the fair value of related securities as of June 30, 2025 and December 31, 2024 were as follows:

Less Than 12 Months

12 Months or More

March 31, 2025

June 30, 2025

government and agency obligations

23 unchanged sentences

$ 43,739,606 $ ( 120,511 ) $ 55,231,941 $ ( 5,993,750 ) $ 98,971,547 $ ( 6,114,261 )

BOGOTA FINANCIAL CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 – SECURITIES AVAILABLE FOR SALE (Continued)

Unrealized losses on corporate bonds available for sale are not considered to be credit losses because the bonds are of high credit quality, management does not intend to sell and it is likely that management will not be required to sell the securities prior to their anticipated recovery, and the decline in fair value was largely due to changes in interest rates and other market conditions.

At March 31, 2025 , 100 % of the mortgage-backed securities were issued by U.S.

At June 30, 2025 , 100 % of the mortgage-backed securities were issued by U.S.

government-sponsored entities and agencies, primarily FNMA and FHLMC, institutions which the government has affirmed its commitment to support.

There were 52 securities in a l oss position at March 31, 2025 .

Because the decline in fair value was attributable to changes in interest rates and illiquidity, and not credit quality, and because the Bank does not have the intent to sell these mortgage-backed securities and it is likely that it will not be required to sell the securities before their anticipated recovery, the Bank does not consider these losses to be credit-related at March 31, 2025 .

As of March 31, 2025 , no allowance for credit loss ("ACL") was required on available for sale securities.

At March 31, 2025 and December 31, 2024 , securities available for sale with a carrying valu e of $ 5,658,678 and $ 5,741,240 were pledged to secure public deposits.

There were 51 securities in a l oss position at June 30, 2025 .

As of June 30, 2025 , no allowance for credit losses ("ACL") was required on available for sale securities.

At June 30, 2025 and December 31, 2024 , securities available for sale with a carrying valu e of $ 5,476,487 and $ 5,741,240 were pledged to secure public deposits.

Securities available for sale at June 30, 2025 and December 31, 2024 , which were pledged to secure repurchase agreements at the Federal Home Loan Bank of New York, had a carrying value of $ 69,916 and $ 12,881,892 , respectively.

NOTE 3 – LOANS

Loans are summarized as follows at March 31, 2025 and December 31, 2024 :

Loans are summarized as follows at June 30, 2025 and December 31, 2024 :

Residential First Mortgage

16 unchanged sentences

The Bank has granted loans to officers and directors of the Bank.

At March 31, 2025 and December 31, 2024 , such loans totaled $ 2,082,107 and $ 2,256,911 , respectively.

At March 31, 2025 and December 31, 2024 , deferred loan fees were $ 2,562,282 and $ 2,496,364 , respectively.

The following table presents the activity in the ACL by portfolio segment for the three months ended March 31, 2025 and 2024 :

Residential First Mortgage

Commercial Real Estate

At June 30, 2025 and December 31, 2024 , such loans totaled $ 2,052,522 and $ 2,256,911 , respectively.

At June 30, 2025 and December 31, 2024 , deferred loan fees were $ 2,458,592 and $ 2,496,364 , respectively.

The following table presents the activity in the ACL by portfolio segment for the three and six months ended June 30, 2025 and 2024 :

Residential First Mortgage Commercial Real Estate

Multi-Family Real Estate

Commercial and Industrial

Three months ended March 31, 2025

Commercial and Industrial Consumer

Three months ended June 30, 2025

Allowance for credit losses:

8 unchanged sentences

$ 1,660,885 $ 533,874 $ 278,916 $ 92,712 $ 24,340 $ 223 $ 2,590,950

Residential First Mortgage

Commercial Real Estate

Residential First Mortgage Commercial Real Estate

Multi-Family Real Estate

Commercial and Industrial

Three Months Ended March 31, 2024

Commercial and Industrial Consumer

Three Months Ended June 30, 2024

Allowance for credit losses:

8 unchanged sentences

$ 1,836,909 $ 456,898 $ 315,495 $ 105,426 $ 33,221 $ — $ 2,747,949

For the three months ended March 31, 2025 , in addition to the recovery in the table above, the provision for loan losses also included a recovery of $ 50,000 due to a decrease in off-balance sheet commitments.

Residential First Mortgage Commercial Real Estate

Multi-Family Real Estate

Commercial and Industrial Consumer

Six Months Ended June 30, 2025

Allowance for credit losses:

Beginning balance

$ 1,680,949 $ 508,000 $ 289,000 $ 123,000 $ 20,000 $ — $ 2,620,949

Provision for (recovery) of credit losses

( 20,064 ) 25,874 ( 10,084 ) ( 30,288 ) 4,340 223 ( 29,999 )

Loans charged off

— — — — — — —

Total ending allowance balance

$ 1,660,885 $ 533,874 $ 278,916 $ 92,712 $ 24,340 $ 223 $ 2,590,950

Residential First Mortgage Commercial Real Estate

Multi-Family Real Estate

Commercial and Industrial Consumer

Six Months Ended June 30, 2024

Allowance for credit losses:

Beginning balance

$ 1,851,969 $ 437,180 $ 317,300 $ 157,500 $ 22,000 $ — $ 2,785,949

Provision for (recovery) of credit losses

( 15,060 ) 19,718 ( 1,805 ) ( 52,074 ) 11,221 — ( 38,000 )

Loans charged off

— — — — — — —

Total ending allowance balance

$ 1,836,909 $ 456,898 $ 315,495 $ 105,426 $ 33,221 $ — $ 2,747,949

For the three and six months ended June 30, 2025 , the provision for credit losses included a recover y of $ 50,000 due to a decrease in off-balance sheet commitments.

Since the Bank continues to have limited historical loss history, the majority of changes in the ACL noted in the above tables are driven by changes in the balances of the related loan segments and in the economic forecast.

2 unchanged sentences

NOTE 3 – LOANS (Continued)

The following table presents the balance of non-performing loans by portfolio segments as of March 31, 2025 and December 31, 2024 :

Nonaccrual loans beginning of period

Nonaccrual loans end of period

Nonaccrual with no Allowance for Credit Loss

or More Still

March 31, 2025

The following table presents the balance of non-performing loans by portfolio segments as of June 30, 2025 and December 31, 2024 :

Nonaccrual loans beginning of period Nonaccrual loans end of period Nonaccrual with no Allowance for Credit Loss Loans Past Due 90 Days or More Still Accruing

June 30, 2025

Residential First Mortgage

4 unchanged sentences

$ 13,962,695 $ 13,863,889 $ 13,863,889 $ —

Nonaccrual loans beginning of period

Nonaccrual loans end of period

Nonaccrual with no Allowance for Credit Loss

or More Still

Nonaccrual loans beginning of period Nonaccrual loans end of period Nonaccrual with no Allowance for Credit Loss Loans Past Due 90 Days or More Still Accruing

December 31, 2024

5 unchanged sentences

$ 12,776,177 $ 13,962,695 $ 13,962,695 $ —

Collateral - dependent loans individually evaluated with the ACL by collateral type were as follows at March 31, 2025 and December 31, 2024 :

March 31, 2025

Collateral - dependent loans individually evaluated with the ACL by collateral type were as follows at June 30, 2025 and December 31, 2024 :

June 30, 2025

Portfolio segment

16 unchanged sentences

$ 13,962,695 $ —

Interest income recognized during impairment and cash-basis interest income for the three months ended March 31, 2025 and 2024 was nominal.

Interest income recognized during impairment and cash-basis interest income for the three and six months ended June 30, 2025 and 2024 was nominal.

BOGOTA FINANCIAL CORP.

1 unchanged sentence

NOTE 3 – LOANS (Continued)

No no naccrual loans had specific reserves as of March 31, 2025 , as they were all well-secured and in the process of collection.

The Bank had no other real estate owned at either March 31, 2025 or December 31, 2024 .

The following table presents the aging of the recorded investment in past due loans as of March 31, 2025 and December 31, 2024 , by class of loans:

March 31, 2025

No no naccrual loans had specific reserves as of June 30, 2025 as they were all well-secured and in the process of collection.

The Bank had no other real estate owned at either June 30, 2025 or December 31, 2024 .

The following table presents the aging of the recorded investment in past due loans as of June 30, 2025 and December 31, 2024 , by class of loans:

June 30, 2025

Residential First Mortgage

39 unchanged sentences

NOTE 3 – LOANS (Continued)

The following table presents loans, by risk category, loan class and year of origination as of March 31, 2025 and December 31, 2024 :

The following table presents loans, by risk category, loan class and year of origination as of June 30, 2025 and December 31, 2024 :

Term Loans by Origination Year

March 31, 2025

June 30, 2025

Revolving Loans

110 unchanged sentences

$ 44,058,521 $ 32,442,459 $ 109,789,683 $ 33,689,261 $ 68,992,186 $ 160,902,523 $ 264,462,552 $ 714,337,185

There were no loan modifications during the three -month period ended

March 31, 2025

There were no loan modifications during the three - or six -month periods ended

June 30, 2025

BOGOTA FINANCIAL CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4 – STOCK BASED COMPENSATION

The Company maintains the Bogota Financial Corp.

2021 Equity Incentive Plan (the "2021 Plan"), which provides for the issuance of up to 902,602 shares ( 257,887 restricted stock awards and 644,718 stock options) of Bogota Financial Corp.

common stock.

The following is a summary of the Company's restricted stock activity during the three months ended March 31, 2025 :

Number of Non-vested Restricted Shares

Weighted Average Grant Date Fair Value

Outstanding, January 1, 2025

94,607 $ 10.17

$ ( 2,000 ) 7.80

Outstanding, March 31, 2025

92,607 $ 10.12

The following is a summary of the Company's option activity during the three months ended March 31, 2025 :

Number of Stock Options

Weighted Average Exercise Price

Weighted Average Remaining Contractual Term (in years)

Aggregate Intrinsic Value

Outstanding, January 1, 2025

510,119 $ 10.45 6.7 $ —

( 1,500 ) 10.45 -

Outstanding, March 31, 2025

508,619 $ 10.45 6.4 $ —

Options exercisable at March 31, 2025

NOTE 4 – DERIVATIVES AND HEDGING ACTIVITES

4 unchanged sentences

Until a derivative is settled, a favorable change in fair value results in an unrealized gain that is recognized as an asset, while an unfavorable change in fair value results in an unrealized loss that is recognized as a liability.

BOGOTA FINANCIAL CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 5 – DERIVATIVES AND HEDGING ACTIVITES (continued)

The Company generally applies hedge accounting to its derivatives used for market risk management purposes.

15 unchanged sentences

Interest Rate Swaps.

At March 31, 2025 , the Company had five cash flow interest rate swaps with notional amounts of $ 65.0 million hedging certain FHLB advances and brokered deposits.

At June 30, 2025 and December 31, 2024 , the Company had five cash flow interest rate swaps with notional amounts of $ 65.0 million hedging certain FHLB advances and brokered deposits.

The Company also had two fair value interest rate swaps with notional amounts of $ 60.0 million hedging certain fixed-rate residential loans.

1 unchanged sentence

Changes in the fair value of cash flow hedges are recorded in comprehensive income.

Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without the exchange of the underlying notional amount.

Interest rate swaps designated as fair value hedges involve the payment of fixed-rate amounts to a counterparty in exchange for the Company receiving variable-rate payments over the life of the agreement without the exchange of the underlying notional amount.

The fair value hedges are recorded as components of other assets and other liabilities on the Company’s consolidated statement of financial condition.

1 unchanged sentence

The gain or loss on these derivatives, as well as the offsetting loss or gain on the hedged items attributable to the hedged risk, are recognized in interest income in the Company’s consolidated statements of operations.

At December 31, 2024 , the Company had five interest rate swaps with a notional amount of $ 65.0 million to hedge certain FHLB advances and brokered deposits and two fair value interest rate swaps with notional amounts of $ 60.0 million hedging certain fixed-rate residential loans.

At both March 31, 2025 and December 31, 2024 , the Company had no back-to-back interest rate swaps in place with commercial banking customers.

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification in the Consolidated Statements of Financial Condition at March 31, 2025 :

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification in the Consolidated Statements of Financial Condition at June 30, 2025 :

Asset Derivative

11 unchanged sentences

$ 16,197 $ 677,761

For the three months ended March 31, 2025 , unrealized losses of $ 657,000 were recorded for changes in fair value of interest rate swaps with third parties and at March 31, 2025 , accrued interest was $ 82,000 .

For the three and six months ended June 30, 2025 , unrealized gains of $ 163,000 and $ 482,000 were recorded for changes in fair value of interest rate swaps with third parties and at June 30, 2025 , accrued interest was $ 90,000 , after-tax.

The Company has agreements with counterparties that contain a provision that if the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default of its derivative obligations.

During the three months ended March 31, 2025 and 2024 , the net effect on interest expense on the Federal Home Loan Bank advances and certificates of deposit was a reduced expense of $ 177,000 and $ 288,000 respectively.

There were no changes to the value of the derivatives.

During the three months ended June 30, 2025 and 2024 , the net effect on interest expense on the Federal H ome Loan Bank advances and certificates of deposit was a reduced expense of $ 186,000 and $ 461,000 , respectively.

During the six months ended June 30, 2025 and 2024 , the net effect on interest expense on the Federal Home Loan Bank advances and certificates of deposit was a reduced expense of $ 363,000 and $ 749,000 , respectively.

BOGOTA FINANCIAL CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 5 – FAIR VALUE

16 unchanged sentences

Quoted Prices

As of March 31, 2025

As of June 30, 2025

Securities available for sale:

9 unchanged sentences

14,265,113 — 14,265,113 —

Fair value hedge

35,818 — 35,818 —

Cash flow hedge

15 unchanged sentences

651,340 — 651,340 —

Fair value hedge

26,421 — 26,421 —

There were no transfers between level 1 and level 2 during the three months ended March 31, 2025 .

The carrying amounts and estimated fair values of financial instruments not measured at fair value, at March 31, 2025 and December 31, 2024 , were as follows:

$ 140,985,208 $ — $ 140,333,868 $ —

There w ere no transfe rs between level 1 and level 2 during the three or six months ended June 30, 2025 .

The carrying amounts and estimated fair values of financial instruments not measured at fair value, at June 30, 2025 and December 31, 2024 , were as follows:

Fair Value Measurement Placement

(In thousands)

March 31, 2025

June 30, 2025

Financial instruments - assets

19 unchanged sentences

NOTE 6 – ACCUMULATED OTHER COMPREHENSIVE LOSS

The components of accumulated other comprehensive loss included in equity (net of tax) for the three months ended March 31, 2025 and 2024 was as follows:

The components of accumulated other comprehensive loss included in equity (net of tax) for the three and six months ended June 30, 2025 and 2024 was as follows:

Unrealized gain

4 unchanged sentences

Three months ended

March 31, 2025

June 30, 2025

Beginning balance

$ ( 3,325,126 ) $ ( 60,526 ) $ 148,469 $ ( 3,237,183 )

Other comprehensive (loss) income before reclassification

( 273,086 ) — ( 162,575 ) ( 435,661 )

Amounts reclassified

— 129,914 — 129,914

Net period comprehensive (loss) income

( 273,086 ) 129,914 ( 162,575 ) ( 305,747 )

Ending balance

$ ( 3,598,212 ) $ 69,388 $ ( 14,106 ) $ ( 3,542,930 )

June 30, 2024

Beginning balance

$ ( 7,417,907 ) $ 5,654 $ 646,907 $ ( 6,765,346 )

Other comprehensive income before reclassification

740,968 — 42,539 783,507

Amounts reclassified

Net period comprehensive income

740,968 — 42,539 783,507

Ending balance

$ ( 6,676,939 ) $ 5,654 $ 689,446 $ ( 5,981,839 )

Unrealized gain and losses on available for sale securities Benefit plans

Six Months Ended June 30, 2025

Beginning balance

$ ( 4,005,169 ) $ ( 60,526 ) $ 468,247 $ ( 3,597,448 )

Other comprehensive income (loss) before reclassification

1 unchanged sentence

Amounts reclassified

— 129,914 — 129,914

Net period comprehensive income (loss)

2 unchanged sentences

$ ( 3,598,212 ) $ 69,388 $ ( 14,106 ) $ ( 3,542,930 )

March 31, 2024

Six Months Ended June 30, 2024

Beginning balance

10 unchanged sentences

Management ’ s Discussion and Analysis of Financial Condition and Results of Operations

Management’s discussion and analysis of financial condition and results of operations at March 31, 2025 and December 31, 2024 and for the three months ended March 31, 2025 and March 31, 2024 is intended to assist in understanding the financial condition and results of operations of Bogota Financial Corp.

Management’s discussion and analysis of financial condition and results of operations at June 30, 2025 and December 31, 2024 and for the three and six months ended June 30, 2025 and June 30, 2024 is intended to assist in understanding the financial condition and results of operations of Bogota Financial Corp.

The information contained in this section should be read in conjunction with the unaudited financial statements and the notes thereto appearing in Part I, Item 1 of this Quarterly Report on Form 10-Q.

10 unchanged sentences

general economic conditions, either nationally or in our market area, that are worse than expected, including potential recessionary conditions;

the imposition of tariffs or other domestic or international governmental policies;

changes in the amount and trend of loan delinquencies, charge-offs and non-performing and classified loans and changes in estimates of the adequacy of and the methodology for calculating the allowance for credit losses;

the imposition of tariffs or other domestic or international governmental policies and retaliatory responses;

changes in the amount and trend of loan delinquencies, charge-offs and non-performing and classified loans and changes in estimates and the methodology for calculating the allowance for credit losses;

our ability to access cost-effective funding;

13 unchanged sentences

our ability to successfully integrate into our operations any assets, liabilities or systems we may acquire, as well as new management personnel or customers, and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto;

changes in consumer spending, borrowing and saving habits;

changes in investor sentiment and consumer spending, borrowing and saving habits;

changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission or the Public Company Accounting Oversight Board;

10 unchanged sentences

Actual results could differ from these judgments and estimates under different conditions, resulting in a change that could have a material impact on the carrying values of our assets and liabilities and our results of operations.

Comparison of Financial Condition at March 31, 2025 and December 31, 2024

Comparison of Financial Condition at June 30, 2025 and December 31, 2024

Total Assets.

Assets decreased $41.3 million, or 4.3%, from $971.5 million at December 31, 2024 to $930.2 million at March 31, 2025 due to a $26.6 million, or 51.0%, decrease in cash and cash equivalents, a $10.2 million, or 1.4%, decrease in loans and a $2.6 million, or 1.8%, decrease in securities available for sale.

Assets decreased $49.7 million, or 5.1%, from $971.5 million at December 31, 2024 to $921.8 million at June 30, 2025 , primarily due to a $31.9 million, or 61.1%, decrease in cash and cash equivalents, and an $18.5 million, or 2.6%, decrease in loans, offset by a $4.3 million, or 3.1%, increase in securities available for sale.

Cash and Cash Equivalents.

Cash and cash equivalents decreased $26.6 million, or 51.0%, to $25.6 million at March 31, 2025 from $52.2 million at December 31, 2024 , as excess funds were used to pay down borrowings.

Cash and cash equivalents decreased $31.9 million, or 61.1%, to $20.3 million at June 30, 2025 from $52.2 million at December 31, 2024 , as excess funds were used to repay borrowings.

Securities Available for Sale.

Securities available for sale decreased $2.6 million, or 1.8%, to $137.7 million at March 31, 2025 from $140.3 million at December 31, 2024 .

The decrease was primarily due to maturing securities of $17.0 million exceeding purchases of $13.5 million of securities.

Net loans decreased $10.2 million, or 1.4%, to $701.5 million at March 31, 2025 from $711.7 million at December 31, 2024 .

The decrease was due to a decrease of $6.6 million, or 1.4%, in one- to four-residential real estate loans to $466.1 million from $472.7 million at December 31, 2024 , a decrease of $9.7 million, or 22.4%, in construction loans to $33.5 million at March 31, 2025 from $43.2 million at December 31, 2024 , and a decrease of $1.1 million, or 17.7%, in commercial and industrial loans to $5.1 million at March 31, 2025 from $6.2 million at December 31, 2024 , offset by a by a $7.8 million, or 6.6%, increase in commercial real estate loans to $125.8 million at March 31, 2025 from $118.0 million at December 31, 2024 .

Securities available for sale increased $4.3 million, or 3.1%, to $144.6 million at June 30, 2025 from $140.3 million at December 31, 2024 , primarily due to purchases of corporate bonds and residential mortgage-backed securities.

Net loans decreased $18.5 million, or 2.6%, to $693.2 million at June 30, 2025 from $711.7 million at December 31, 2024 .

The decrease was due to a decrease of $14.5 million, or 3.1%, in one- to four-residential real estate loans to $458.2 million from $472.7 million at December 31, 2024 , a decrease of $17.4 million, or 40.3%, in construction loans to $25.8 million at June 30, 2025 from $43.2 million at December 31, 2024 , and a decrease of $1.9 million, or 30.5%, in commercial and industrial loans to $4.3 million at June 30, 2025 from $6.2 million at December 31, 2024 , offset by a $8.0 million, or 10.7%, increase in multi-family real estate loans to $82.1 million at June 30, 2025 from $74.2 million at December 31, 2024 , and by a $7.3 million, or 6.2%, increase in commercial real estate loans to $125.3 million at June 30, 2025 from $118.0 million at December 31, 2024 .

The decreases in one- to four-residential real estate loans and construction loans reflected a decrease in demand for such loans due to the interest rate environment.

As of March 31, 2025 and December 31, 2024 , the Bank had no loans held for sale.

Delinquent loans decreased $842,000 to $13.5 million, or 1.9% of total loans, at March 31, 2025 , compared to $14.3 million, or 2.0% of total loans, at December 31, 2024 .

The decrease was mostly due to the payoff of one commercial real estate loan with a balance of $455,000 and residential loans totaling $387,000 being brought current.

We did not record any specific reserves or charge-offs for these loans.

During the same timeframe, non-performing assets decreased from $14.0 million at December 31, 2024 to $13.9 million, which represented 1.49% of total assets at March 31, 2025 .

The Company’s allowance for credit losses was 0.37% of total loans and 18.65% of non-performing loans at March 31, 2025 compared to 0.37% of total loans and 18.77% of non-performing loans at December 31, 2024 .

As of June 30, 2025 and December 31, 2024 , the Bank had no loans held for sale.

Asset Quality.

Delinquent loans increased $6.1 million to $20.4 million, or 2.9% of total loans, at June 30, 2025 , compared to $14.3 million, or 2.0% of total loans, at December 31, 2024 .

The increase was primarily due to one commercial real estate loan that became 60 days past due, which has a balance of $7.1 million, and is considered well-secured, accruing and in the process of collection.

We did not record any specific reserves or charge-offs for our nonaccrual loans.

During the same timeframe, non-performing assets decreased from $14.0 million at December 31, 2024 to $13.9 million, which represented 1.5% of total assets at June 30, 2025 .

The Company’s allowance for credit losses was 0.37% of total loans and 18.69% of non-performing loans at June 30, 2025 compared to 0.37% of total loans and 18.77% of non-performing loans at December 31, 2024 .

The Bank does not have any exposure to commercial real estate loans secured by office space.

Non-performing loans at March 31, 2025 were primarily comprised of one construction loan for a catering hall that is 99% complete, with a balance of $10.9 million and a loan to value ratio of 45%.

Based on the well-secured nature of the loan, there was no associated specific reserve at March 31, 2025 .

Non-performing loans at June 30, 2025 were primarily comprised of one construction loan for a catering hall that is 99% complete, with a balance of $10.9 million and a loan to value ratio of 45%.

Based on the well-secured nature of the loan, there was no associated specific reserve at June 30, 2025 .

The Company has commenced legal action to foreclose on the property, which is ongoing.

The Company did not record any charge-offs for the three and six months ended June 30, 2025 or 2024.

Total Liabilities.

Total liabilities decreased $42.3 million, or 5.1%, to $791.9 million as of March 31, 2025 from $834.2 million as of December 31, 2024 , primarily due to a $32.4 million decrease in borrowings and a $9.2 million decrease in deposits.

Deposits decreased $9.2 million, or 1.4%, to $633.0 million at March 31, 2025 from $642.2 million at December 31, 2024 .

The decrease in deposits reflected a decrease in certificates of deposit of $17.3 million, or 3.5%, to $476.0 million as of March 31, 2025 from $493.3 million at December 31, 2024 and a $1.2 million, or 8.3%, decrease in money market accounts.

The decreases were offset by a $6.6 million, or 11.9%, increase in NOW accounts, and by a $2.4 million, or 5.2%, increase in savings accounts.

The changes reflected customers’ uncertainty about the lower rate environment and market opportunities.

At March 31, 2025 , municipal deposits totaled $39.2 million, which represented 6.2% of total deposits, and brokered deposits totaled $94.2 million, which represented 14.9% of deposits.

Total liabilities decreased $50.8 million, or 6.1%, to $783.4 million as of June 30, 2025 from $834.2 million as of December 31, 2024 , primarily due to a $36.2 million decrease in borrowings and a $14.0 million decrease in deposits.

Deposits decreased $14.0 million, or 2.2%, to $628.2 million at June 30, 2025 from $642.2 million at December 31, 2024 .

The decrease in deposits was reflected in most deposit categories including a decrease in certificates of deposit of $11.5 million, or 2.3%, to $481.8 million as of June 30, 2025 from $493.3 million at December 31, 2024 , a decrease in NOW accounts of $2.8 million, or 5.0%, to $52.6 million as of June 30, 2025 from $55.4 million at December 31, 2024 , a $2.3 million, or 16.6%, decrease in money market accounts to $11.7 million as of June 30, 2025 from $14.0 million at December 31, 2024 .

The decreases were offset by a $4.6 million, or 9.8%, increase in savings accounts.

The changes reflected competition and customers moving funds into other higher-yielding investments.

At June 30, 2025 , municipal deposits totaled $25.4 million, which represented 4.1% of total deposits, and brokered deposits totaled $108.0 million, which represented 17.2% of deposits.

At December 31, 2024 , municipal deposits totaled $30.7 million, which represented 4.8% of deposits, and brokered deposits totaled $101.6 million, which represented 15.8% of total deposits.

At March 31, 2025 , uninsured deposits totaled $49.8 million, comprised of 224 account holders, which represented 7.9% of total deposits.

Federal Home Loan Bank of New York borrowings decreased $32.4 million, or 18.8%, to $139.8 million at March 31, 2025 from $172.2 million at December 31, 2024 .

Specifically short-term advances decreased by $5.0 million while long-term advances decreased $27.4 million.

The weighted average rate of borrowings was 4.52% and 4.49% as of March 31, 2025 and December 31, 2024 , respectively.

The increased rate in the lower rate environment reflected shorter maturities of the borrowings.

Total borrowing capacity at the Federal Home Loan Bank was $261.9 million at March 31, 2025 , of which $139.8 million has been advanced.

At June 30, 2025 , uninsured deposits totaled $57.0 million, comprised of 300 account holders, which represented 9.1% of total deposits.

Federal Home Loan Bank of New York borrowings decreased $36.2 million, or 21.0%, to $136.0 million at June 30, 2025 from $172.2 million at December 31, 2024 .

Long-term advances decreased $46.7 million, while short-term advances increased by $10.5 million.

The weighted average rate of borrowings was 3.99% and 4.49% as of June 30, 2025 and December 31, 2024 , respectively.

Total borrowing capacity at the Federal Home Loan Bank was $241.3 million at June 30, 2025 , of which $136.0 million has been advanced.

The decrease in borrowings was largely attributable to the repayment of advances and borrowings that matured during the six months ended June 30, 2025.

Total Equity.

Stockholders’ equity increased $965,000 to $138.3 million, primarily due to net income of $731,000 and by a decrease in accumulated other comprehensive loss of $360,000, offset by the repurchase of 50,211 shares at a cost of $398,000 .

At March 31, 2025 , the Company’s ratio of average stockholders’ equity-to-average total assets was 14.59%, compared to 13.99% at December 31, 2024 .

Stockholders’ equity increased $1.2 million to $138.4 million, primarily due to net income of $955,000 .

At June 30, 2025 , the Company’s ratio of average stockholders’ equity-to-average total assets was 15.94%, compared to 13.99% at December 31, 2024 .

Average Balance Sheets and Related Yields and Rates

4 unchanged sentences

Loan fees are included in interest income on loans and are not material.

Three Months Ended March 31,

Three Months Ended June 30,

Average Balance

Interest and Dividends

Yield/ Cost (1)

Average Balance

Interest and Dividends

Yield/ Cost (1)

(Dollars in thousands)

19 unchanged sentences

(1) Cash flow and fair value hedges are used to manage interest rate risk.

During the three months ended June 30, 2025 and 2024 , the net effect on interest expense on the Federal Home Loan Bank advances and certificates of deposit was a reduced expense of $186,000 and $461,000 respectively.

(2) Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

(3) Net interest margin represents net interest income divided by average total interest-earning assets.

Six Months Ended June 30,

Average Balance

Interest and Dividends

Average Balance

Interest and Dividends

(Dollars in thousands)

Cash and cash equivalents

Other interest-earning assets

Total interest-earning assets

Non-interest-earning assets

Liabilities and equity:

NOW and money market accounts

Savings accounts

Certificates of deposit (1)

Total interest-bearing deposits

Federal Home Loan Bank advances (1)

Total interest-bearing liabilities

Non-interest-bearing deposits

Other non-interest-bearing liabilities

Total liabilities

Total liabilities and equity

Net interest income

Interest rate spread (2)

Net interest margin (3)

Average interest-earning assets to average interest-bearing liabilities

(1) Cash flow hedges are used to manage interest rate risk.

During the six months ended June 30, 2025 and 2024, the net effect on interest expense on the Federal Home Loan Bank advances and certificates of deposit was a reduced expense of $ 363,000 and $749,000 respectively.

(2) Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

(3) Net interest margin represents net interest income divided by average total interest-earning assets.

Rate/Volume Analysis

4 unchanged sentences

Changes attributable to changes in both rate and volume that cannot be segregated have been allocated proportionally based on the changes due to rate and the changes due to volume.

Three Months Ended March 31, 2025

Three Months Ended March 31, 2024

Three Months Ended June 30, 2025

Six Months Ended June 30, 2025

Three Months Ended June 30, 2024

Six Months Ended June 30, 2024

Increase (Decrease) Due to

(In thousands)

11 unchanged sentences

Net (decrease) increase in net interest income

Comparison of Operating Results for the Three Months Ended March 31, 2025 and March 31, 2024

Net income increased by $1.2 million to $731,000 for the three months ended March 31, 2025 from a net loss of $441,000 for the three months ended March 31, 2024 .

The increase was primarily due to an increase of $942,000 in net interest income, and a $590,000 increase in non-interest income, partially offset by an increase of $300,000 in occupancy and equipment costs, and a decrease of $259,000 in income tax benefit .

Comparison of Operating Results for the Three Months Ended June 30, 2025 and June 30, 2024

Net income increased $657,000 to $224,000 for the three months ended June 30, 2025 from a net loss of $432,000 for the three months ended June 30, 2024 .

The increase was primarily due to an increase of $920,000 in net interest income, partially offset by an increase of $129,000 in non-interest expenses, and a decrease of $229,000 in income tax benefit.

Interest Income.

Interest income increased $862,000, or 8.6%, from $10.1 million for the three months ended March 31, 2024 to $10.9 million for the three months ended March 31, 2025 primarily due to higher yields on interest-earning assets.

Interest income on cash and cash equivalents increased $115,000, or 76.7%, to $265,000 for the three months ended March 31, 2025 from $150,000 for the three months ended March 31, 2024 due to a $6.7 million increase in the average balance to $16.6 million for the three months ended March 31, 2025 from $9.9 million for the three months ended March 31, 2024 , reflecting the decrease in loans and securities.

The increase was augmented by an 27 basis point increase in the average yield from 6.10% for the three months ended March 31, 2024 to 6.37% for the three months ended March 31, 2025 .

Interest income on loans increased $396,000, or 4.8%, to $8.6 million for the three months ended March 31, 2025 compared to $8.2 million for the three months ended March 31, 2024 due primarily to a 27 basis point increase in the average yield from 4.61% for the three months ended March 31, 2024 to 4.88% for the three months ended March 31, 2025 , which was offset by a $8.3 million decrease in the average balance to $705.1 million for the three months ended March 31, 2025 from $713.4 million for the three months ended March 31, 2024 .

Interest income on securities increased $304,000, or 19.9%, to $1.8 million for the three months ended March 31, 2025 from $1.5 million for the three months ended March 31, 2024 primarily due to a 138 basis point increase in the average yield from 3.67% for the three months ended March 31, 2024 to 5.05% for the three months ended March 31, 2025 due to a rebalancing of the balance sheet in the fourth quarter of 2024.

This was partially offset by a $21.4 million decrease in the average balance to $145.3 million for the three months ended March 31, 2025 from $166.7 million for the three months ended March 31, 2024 .

Interest income increased $31,000, or 0.3%, to $10.5 million for the three months ended June 30, 2025 and June 30, 2024 .

Interest income on cash and cash equivalents decreased $21,000, or 16.4%, to $106,000 for the three months ended June 30, 2025 from $127,000 for the three months ended June 30, 2024 due to a decrease of 164 basis points in the average yield from 5.90% for the three months ended June 30, 2024 to 4.26% for the three months ended June 30, 2025 .

The decrease in the average yield was partially offset by a $1.3 million increase in the average balance to $9.9 million for the three months ended June 30, 2025 from $8.6 million for the three months ended June 30, 2024 .

Interest income on loans decreased $7,000, or 0.1%, as a $12.3 million decrease in the average balance to $697.8 million for the three months ended June 30, 2025 from $710.1 million for the three months ended June 30, 2024 was offset by a seven basis point increase in the yield from 4.70% for the three months ended June 30, 2024 to 4.77% for the three months ended June 30, 2025 .

Interest income on securities increased $86,000, or 4.6%, due to a 151 basis points, from 4.01% for the three months ended June 30, 2024 to 5.52% for the three months ended June 30, 2025 , which was offset by a $44.4 million decrease in the average balance to $141.1 million for the three months ended June 30, 2025 from $185.5 million for the three months ended June 30, 2024 .

The changes in the yield and average balance reflect that, in the fourth quarter of 2024, the Company sold approximately $66.0 million in amortized cost ($57.1 million in market value) of securities with a weighted average yield of 1.89% and reinvested $32.7 million of these proceeds into securities with a weighted average yield of 5.60%.

Interest Expense.

Interest expense decreased $80,000, or 1.1%, from $7.4 million for the three months ended March 31, 2024 to $7.3 million for the three months ended March 31, 2025 due to lower average balances on certificates of deposit, offset by an increase in average borrowing and borrowing costs.

Interest expense on interest-bearing deposits decreased $208,000, or 3.5%, to $5.8 million for the three months ended March 31, 2025 from $6.0 million for the three months ended March 31, 2024 .

The decrease was primarily due to lower average balances on certificates of deposit, which decreased to $484.3 million for the three months ended March 31, 2025 from $516.5 million for the three months ended March 31, 2024 .

The decrease was offset by an increase in the average balances of NOW and money market accounts, which increased by $10.0 million, from $69.4 million for the three months ended March 31, 2024 to $79.4 million for the three months ended March 31, 2025 , and due to higher cost of borrowings for those accounts which increased 40 basis points from 1.94% for the three months ended March 31, 2024 , to 2.34% for the three months ended March 31, 2025 .

Interest expense on Federal Home Loan Bank advances increased $128,000, or 8.9%, from $1.4 million for the three months ended March 31, 2024 to $1.6 million for the three months ended March 31, 2025 .

The increase was due to an increase in the average balance of $4.8 million to $158.1 million for the three months ended March 31, 2025 .

The increase was also due to a 24 basis point increase in the average cost of borrowings to 4.02% for the three months ended March 31, 2025 from 3.78% for the three months ended March 31, 2024 due to the new borrowings being shorter durations at higher rates.

Interest expense decreased $920,000, or 11.9%, from $7.7 million for the three months ended June 30, 2024 to $6.8 million for the three months ended June 30, 2025 due to lower average balances on certificates of deposit and borrowings and a decrease in the costs of certificates of deposit, offset by an increase in borrowing costs.

Interest expense on interest-bearing deposits decreased $730,000, or 11.7%, to $5.5 million for the three months ended June 30, 2025 from $6.3 million for the three months ended June 30, 2024 .

The decrease was primarily due to lower average balance of certificates of deposit, which decreased to $482.5 million for the three months ended June 30, 2025 from $517.9 million for the three months ended June 30, 2024 .

The decrease was offset by an increase in the average balances of NOW and money market accounts, which increased by $5.6 million, from $67.7 million for the three months ended June 30, 2024 to $73.3 million for the three months ended June 30, 2025 , and by an increase in the average balances of savings accounts, which increased by $4.7 million, from $44.1 million for the three months ended June 30, 2024 to $48.8 million for the three months ended June 30, 2025 .

In addition to the changes in average balances, the average cost of interest bearing deposits decreased 32 basis points from 3.99% for the three months ended June 30, 2024 , to 3.67% for the three months ended June 30, 2025 , due to a 44 basis point decrease in the average costs of certificates of deposit, offset by increases in the average costs of NOW and money market accounts and savings accounts.

Interest expense on Federal Home Loan Bank advances decreased $190,000, or 12.9%, from $1.5 million for the three months ended June 30, 2024 to $1.3 million for the three months ended June 30, 2025 .

The decrease was due to a decrease in the average balance of $40.0 million to $130.3 million for the three months ended June 30, 2025 .

The decrease was offset by a 47 basis point increase in the average cost of borrowings to 3.96% for the three months ended June 30, 2025 from 3.49% for the three months ended June 30, 2024 due to the new borrowings being shorter durations at higher rates.

Net Interest Income.

Net interest income increased $942,000, or 35.5%, to $3.6 million for the three months ended March 31, 2025 from $2.7 million for the three months ended March 31, 2024 .

The increase reflected a 44 basis point increase in our net interest rate spread to 1.12% for the three months ended March 31, 2025 from 0.68% for the three months ended March 31, 2024 .

Our net interest margin increased 48 basis points to 1.66% for the three months ended March 31, 2025 from 1.18% for the three months ended March 31, 2024 .

Net interest income increased $951,000, or 34.7%, to $3.7 million for the three months ended June 30, 2025 from $2.7 million for the three months ended June 30, 2024 .

The increase reflected a 48 basis point increase in the net interest rate spread to 1.20% for the three months ended June 30, 2025 from 0.72% for the three months ended June 30, 2024 .

The net interest margin increased 53 basis points to 1.74% for the three months ended June 30, 2025 from 1.21% for the three months ended June 30, 2024 .

Provision for Credit Losses.

We recorded an $80,000 recovery of credit losses for the three months ended March 31, 2025 compared to a $35,000 provision for credit losses for the three months ended March 31, 2024 .

The decrease in the allowance for credit losses was due to the decrease in loans and held-to-maturity securities.

We did not record a provision for credit losses for the three months ended June 30, 2025 compared to a $35,000 provision for credit losses for the three months ended June 30, 2024 .

The decrease in the allowance for credit losses was due to the decrease in loans and held-to-maturity securities and the absence of charge-offs.

Non-Interest Income.

Non-interest income increased by $590,000, or 197.4%, to $889,000 for the three months ended March 31, 2025 from $299,000 for the three months ended March 31, 2024 .

Bank-owned life insurance income increased $550,000, or 259.5%, due to a death benefit receivable related to a former employee and higher balances during 2025 .

Additionally, we had a gain on the sale of one loan of $29,000 compared to no gain on sale of loans for the three months ended March 31, 2024 .

Non-interest income increased by $29,000, or 9.4%, to $332,000 for the three months ended June 30, 2025 from $303,000 for the three months ended June 30, 2024 .

Bank-owned life insurance income increased $13,000, or 6.0%, due to higher yield during 2025 .

Additionally, gains on the sale of loans increased $9,000 compared to no gain on sale of loans for the three months ended June 30, 2024 .

Non-Interest Expense.

For the three months ended March 31, 2025 , non-interest expense increased $217,000, or 5.9%, over the comparable 2024 period.

This was due to a $300,000, or 80.9%, increase in occupancy and equipment expense, which increased as a result of increased occupancy costs related to the sale leaseback transaction that was completed in the fourth quarter of 2024, offset by a $78,000, or 3.6%, decrease in salaries and benefits costs, which was a result of reduced headcount.

For the three months ended June 30, 2025 , non-interest expense increased $129,000, or 3.5%, over the comparable 2024 period.

This was due to a $274,000, or 74.6%, increase in occupancy and equipment expense, which increased as a result of increased occupancy costs related to the sale leaseback transaction that was completed in the fourth quarter of 2024, and a $112,000, or 43.2%, increase in professional fees, which were largely attributable to legal expense related to ongoing foreclosure of one past due loan.

These increases were offset by a $83,000, or 3.9%, decrease in salaries and benefits costs, which was a result of reduced headcount, and a $99,000 decrease in advertising costs when compared to the three months ended June 30, 2024 .

Income Tax Expense.

Income tax benefit decreased $259,000, or 90.2%, to a benefit of $28,000 for the three months ended March 31, 2025 from a $287,000 benefit for the three months ended March 31, 2024 .

The decrease was due to an increase of $1.4 million of taxable income.

Income tax benefit decreased $229,000, or 81.3%, to a benefit of $53,000 for the three months ended June 30, 2025 from a $281,000 benefit for the three months ended June 30, 2024 .

The decrease was due to an increase of $886,000 of net income.

Comparison of Operating Results for the Six Months Ended June 30, 2025 and June 30, 2024

Net income increased by $1.8 million to $955,000 for the six months ended June 30, 2025 from a net loss of $873,000 for the six months ended June 30, 2024 .

The increase was primarily due to an increase of $1.9 million in net interest income, and a $619,000 increase in non-interest income, partially offset by an increase of $574,000 in occupancy and equipment costs, and a decrease of $488,000 in inco me tax benefit .

I ncome for the six months ended June 30, 2025 included a one-time death benefit of approximately $543,000 from the Company's bank-owned life insurance policy related to a former employee.

Interest Income.

Interest income increased $893,000, or 4.4%, from $20.5 million for the six months ended June 30, 2024 to $21.4 million for the six months ended June 30, 2025 primarily due to higher yields on interest-earning assets, offset by a decrease in the average balance of interest-earning assets.

Interest income on cash and cash equivalents increased $95,000, or 34.4%, to $371,000 for the six months ended June 30, 2025 from $276,000 for the six months ended June 30, 2024 due to a $4.8 million increase in the average balance to $13.3 million for the six months ended June 30, 2025 from $8.5 million for the six months ended June 30, 2024 , reflecting the decrease in loans and securities.

The increase was offset by an 92 basis point decrease in the average yield from 6.50% for the six months ended June 30, 2024 to 5.58% for the six months ended June 30, 2025 .

Interest income on loans increased $387,000, or 2.3%, to $16.9 million for the six months ended June 30, 2025 compared to $16.5 million for the six months ended June 30, 2024 due primarily to a 18 basis point increase in the average yield from 4.64% for the six months ended June 30, 2024 to 4.82% for the six months ended June 30, 2025 , which was offset by a $10.3 million decrease in the average balance to $701.4 million for the six months ended June 30, 2025 from $711.7 million for the six months ended June 30, 2024 .

Interest income on securities increased $390,000, or 11.5%, to $3.8 million for the six months ended June 30, 2025 from $3.4 million for the six months ended June 30, 2024 , primarily due to a 143 basis point increase in the average yield from 3.85% for the six months ended June 30, 2024 to 5.28% for the six months ended June 30, 2025 .

This was partially offset by a $32.9 million decrease in the average balance to $143.2 million for the six months ended June 30, 2025 from $176.1 million for the six months ended June 30, 2024 .

The decrease in the average balance and the increase in the yield was as a result of a balance sheet restructuring undertaken in the fourth quarter of 2024, where certain lower-yielding securities were sold, a portion of the proceeds were reinvested into higher-yielding securities and all remaining held to maturity securities were reclassified as available for sale.

Interest Expense.

Interest expense decreased $1.0 million, or 6.6%, from $15.1 million for the six months ended June 30, 2024 to $14.1 million for the six months ended June 30, 2025 , primarily due to lower average balance and cost of certificates of deposit and lower average balance of borrowings, offset by an increase in costs of borrowings.

Interest expense on interest-bearing deposits decreased $938,000, or 7.7%, to $11.3 million for the six months ended June 30, 2025 from $12.2 million for the six months ended June 30, 2024 .

The decrease was primarily due to lower average balances on certificates of deposit, which decreased to $483.4 million for the six months ended June 30, 2025 from $517.2 million for the six months ended June 30, 2024 and due to the lower costs of certificates of deposit.

The decrease was offset by an increase in the average balances of NOW and money market accounts, which increased by $7.7 million, from $68.6 million for the six months ended June 30, 2024 to $76.3 million for the six months ended June 30, 2025 , and due to higher cost of those accounts which increased 44 basis points from 1.95% for the six months ended June 30, 2024 , to 2.39% for the six months ended June 30, 2025 .

Also the average balances of savings accounts increased $3.6 million, from $43.7 million for the six months ended June 30, 2024 to $47.3 million for the six months ended June 30, 2025 , and the cost of those accounts increased 17 basis points from 1.85% for the six months ended June 30, 2024 , to 2.02% for the six months ended June 30, 2025 .

Interest expense on Federal Home Loan Bank advances decreased $62,000, or 2.1% .

The decrease was due to a decrease in the average balance of $16.2 million to $144.1 million for the six months ended June 30, 2025 .

The increase in average balances of borrowings was offset by a 33 basis point increase in the average cost of borrowings to 3.99% for the six months ended June 30, 2025 from 3.66% for the six months ended June 30, 2024 due to the new borrowings being shorter durations at higher rates.

Net Interest Income.

Net interest income increased $1.9 million, or 35.1%, to $7.3 million for the six months ended June 30, 2025 from $5.4 million for the six months ended June 30, 2024 .

The increase reflected a 47 basis point increase in the net interest rate spread to 1.15% for the six months ended June 30, 2025 from 0.68% for the six months ended June 30, 2024 .

The net interest margin increased 50 basis points to 1.70% for the six months ended June 30, 2025 from 1.20% for the six months ended June 30, 2024 .

Provision for Credit Losses.

We recorded an $80,000 recovery of credit losses for the six months ended June 30, 2025 compared to a $70,000 provision for credit losses for the six months ended June 30, 2024 .

The decrease in the provision for credit losses was due to the decrease in loans, loan commitments and held-to-maturity securities and the absence of charge-offs.

Non-Interest Income.

Non-interest income increased by $619,000, or 102.7%, to $1.2 million for the six months ended June 30, 2025 from $602,000 for the six months ended June 30, 2024 .

Bank-owned life insurance income increased $564,000, or 132.0%, due to a death benefit receivable related to a former employee and higher yields during 2025 .

Additionally, the gain on the sale of loans increased $38,000 compared to no gain on sale of loans for the six months ended June 30, 2024 .

Non-Interest Expense.

For the six months ended June 30, 2025 , non-interest expense increased $345,000, or 4.7%, over the comparable 2024 period.

This was due to a $574,000, or 77.8%, increase in occupancy and equipment expense, which increased as a result of the sale leaseback transaction that was completed in the fourth quarter of 2024, and by a $114,000, or 25.0%, increase in professional fees that was largely attributable to legal fees related to one past due loan.

These were offset by a $162,000, or 3.8%, decrease in salaries and benefits costs, which was a result of reduced headcount, and a $104,000 decrease in advertising expense.

Income Tax Expense.

Income tax benefit decreased $488,000, or 85.8%, to a benefit of $81,000 for the six months ended June 30, 2025 from a $568,000 benefit for the six months ended June 30, 2024 .

The decrease was due to an increase of $2.3 million of net income.

Management of Market Risk

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Accordingly, our board of directors has established an Asset/Liability Management Committee (the “ALCO”), which is comprised of three members of executive management and two independent directors, which oversees the asset/liability management processes and related procedures.

The ALCO meets on at least a quarterly basis and reviews asset/liability strategies, liquidity position, alternative funding sources, interest rate risk measurement reports, capital levels and economic trends at both national and local levels.

The ALCO meets on at least a quarterly basis and reviews asset/liability strategies, liquidity, funding sources, interest rate risk measurement reports, capital levels and economic trends at both national and local levels.

Our interest rate risk position is also monitored quarterly by the board of directors.

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monitoring the length of our borrowings with the Federal Home Loan Bank and brokered deposits depending on the interest rate environment;

maintaining a majority of our investments as available-for-sale;

maintaining all of our investments as available-for-sale;

diversifying our loan portfolio;

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We then calculate what the NPV would be at the same date throughout a series of interest rate scenarios representing immediate and permanent, parallel shifts in the yield curve.

We currently calculate NPV under the assumptions that interest rates increase 100, 200, 300 and 400 basis points from current market rates and that interest rates decrease 100, 200, 300 and 400 basis points from current market rates.

The following table presents the estimated changes in our net portfolio value that would result from changes in market interest rates as of March 31, 2025 .

We currently calculate NPV under the assumptions that interest rates increase and decrease 100, 200, 300 and 400 basis points from current market rates.

The following table presents the estimated changes in our net portfolio value that would result from changes in market interest rates as of June 30, 2025 .

All estimated changes presented in the table are within the policy limits approved by the board of directors.

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Assumptions are supported with quarterly back testing of the model to actual market rate shifts.

As of March 31, 2025 , net interest income simulation results indicated that its exposure over one year to changing interest rates was within our guidelines.

As of June 30, 2025 , net interest income simulation results indicated that its exposure over one year to changing interest rates was within our guidelines.

The following table presents the estimated impact of interest rate changes on our estimated net interest income over one year:

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Liquidity and Capital Resources

Liquidity describes our ability to meet financi al obligations that arise in the ordinary course of business.

Liquidity describes our ability to meet financial obligations that arise in the ordinary course of business.

Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures.

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We also borrow from the Federal Home Loan Bank of New York.

At March 31, 2025 , we had the ability to borrow up to $261.9 million, of which $139.8 million was outstanding and $5.7 million was utilized as collateral for letters of credit issued to secure municipal deposits.

At March 31, 2025 , we had $54.0 million in unsecured lines of credit with four correspondent banks with no outstanding balance.

At June 30, 2025 , we had the ability to borrow up to $241.3 million, of which $139.5 million was outstanding and $5.5 million was utilized as collateral for letters of credit issued to secure municipal deposits.

At June 30, 2025 , we had $54.0 million in unsecured lines of credit with four correspondent banks with no outstanding balance.

The board of directors is responsible for establishing and monitoring our liquidity targets and st rategies in order to ensure that sufficient liquidity exists for meeting the borrowing needs and deposit withdrawals of our customers as well as unanticipated contingencies.

We believe that we had ample sources of liquidity to satisfy our short- and long-term liquidity needs as of March 31, 2025 .

We believe that we had ample sources of liquidity to satisfy our short- and long-term liquidity needs as of June 30, 2025 .

While maturities and scheduled amortization of loans and securities are predictable sources of funds, deposit flows, loan prepayments and loan and security sales are greatly influenced by market interest rates, economic conditions, and competition.

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The levels of these assets are dependent on our operating, financing, lending and investing activities during any period.

At March 31, 2025 , cash and cash equivalents totaled $25.6 million.

Securities classified as available-for-sale, which provide additional sources of liquidity, totaled $137.7 million at March 31, 2025 .

At June 30, 2025 , cash and cash equivalents totaled $20.3 million.

Securities classified as available-for-sale, which provide additional sources of liquidity, totaled $144.6 million at June 30, 2025 .

We are committed to maintaining a strong liquidity position.

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We anticipate we will have sufficient funds to meet our current funding commitments.

Certificates of deposit due within one year of March 31, 2025 t otaled $439.7 million, or 69.5% of total deposits.

Certificates of deposit due within one year of June 30, 2025 t otaled $429.4 million, or 68.4% of total deposits.

If these deposits do not remain with us, we will be required to seek other sources of funds, including other deposits and Federal Home Loan Bank of New York advances.

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We are subject to various regulatory capital requirements administered by the New Jersey Department of Banking and Insurance and the Federal Deposit Insurance Corporation.

At March 31, 2025 , we exceeded all applicable regulatory capital requirements, and were considered “well capitalized” under regulatory guidelines.

At June 30, 2025 , we exceeded all applicable regulatory capital requirements, and were considered “well capitalized” under regulatory guidelines.

As a result of the Economic Growth, Regulatory Relie f, and Consumer Protection Act, as modified in April 2020, the federal banking agencies were required to develop a “Community Bank Leverage Ratio” (the ratio of a bank's Tier 1 “equity capital to average total consolidated assets) for financial institutions with less than $10 billion.

A “qualifying community bank” with capital exceeding 9% will be considered compliant with all applicable regulatory capital and leverage requirements, including the capital requirements to be considered "well capitalized” under Prompt Corrective Action statutes.

As of March 31, 2025 , the Bank reported as a qualifying community bank with a ratio of 15.00%.

As of June 30, 2025 , the Bank reported as a qualifying community bank with a ratio of 15.40%.

Substantially all of the Company's assets and liabilities relate to banking activities and are monetary.

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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