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Item 1. Financial Statements

2025-05-09 compared with 2024-11-08 · 133 added, 305 removed, 756 unchanged (37% of the section changed)

1 unchanged sentence

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Unaudited) September 30,

(Unaudited) March 31,

2025 December 31,

8 unchanged sentences

Loans Held for Sale 230 900

Loans, Net of Allowance for Credit Losses of $ 9,479 and $ 9,707 at September 30, 2024 and December 31, 2023, Respectively

Loans, Net of Allowance for Credit Losses of $ 9,819 and $ 9,805 at March 31, 2025 and December 31, 2024, Respectively

1,078,675 1,082,821

3 unchanged sentences

24,358 24,209

Intangible Assets, Net

Accrued Interest Receivable and Other Assets 30,096 31,469

12 unchanged sentences

STOCKHOLDERS' EQUITY

Preferred Stock, No Par Value;

5,000,000 Shares Authorized

Common Stock, $ 0.4167 Par Value;

35,000,000 Shares Authorized, 5,789,438 Shares Issued and 5,129,921 Shares Outstanding at September 30, 2024, with 5,759,378 and 5,118,713 Shares Issued and Outstanding at December 31, 2023.

35,000,000 Shares Authorized, 5,828,717 Shares Issued and 5,099,069 Shares Outstanding at March 31, 2025, with 5,787,744 and 5,132,654 Shares Issued and Outstanding at December 31, 2024.

Capital Surplus

2 unchanged sentences

91,484 90,856

Treasury Stock, at Cost ( 659,517 and 640,665 Shares at September 30, 2024 and December 31, 2023, Respectively)

Treasury Stock, at Cost ( 729,648 and 655,090 Shares at March 31, 2025 and December 31, 2024, Respectively)

( 17,214 ) ( 15,028 )

7 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

(Dollars in thousands, except share and per share data)

3 unchanged sentences

Taxable 2,777 2,303

Tax-Exempt — 41 — 124

Dividends 28 27

14 unchanged sentences

Other Commissions 63 62

Net Gain (Loss) on Sales of Loans 18 — 49 ( 3 )

Net Gain (Loss) on Securities 245 ( 37 ) 49 ( 369 )

Net Gain on Sales of Loans 22 22

Net Loss on Securities ( 69 ) ( 166 )

Net Gain on Purchased Tax Credits 4 12

Gain on Sale of Subsidiary 138 — 138 —

Net Gain on Disposal of Premises and Equipment — 274

18 unchanged sentences

Income Before Income Tax Expense

3,966 3,236 12,292 11,978

Income Tax Expense 427 920

9 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

(Dollars in thousands)

1 unchanged sentence

Other Comprehensive Income (Loss):

Change in Unrealized Gain (Loss) on Investment Securities Available-for-Sale 5,644 ( 4,248 ) 3,672 ( 4,372 )

Unrealized Gain (Loss) on Investment Securities Available-for-Sale 2,371 ( 1,628 )

Income Tax Effect ( 506 ) 295

Other Comprehensive Income (Loss), Net of Income Tax Effect 1,865 ( 1,333 )

Total Comprehensive Income (Loss) $ 7,660 $ ( 660 ) $ 12,902 $ 6,156

Total Comprehensive Income $ 3,774 $ 2,863

The accompanying notes are an integral part of these consolidated financial statements

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED)

Three Months Ended September 30, 2024 Shares Issued Common Stock Capital Surplus Retained Earnings Treasury Stock Accumulated Other Comprehensive Loss Total Stockholders' Equity

(Dollars in thousands, except share and per share data)

June 30, 2024 5,783,588 $ 2,410 $ 85,718 $ 87,673 $ ( 14,568 ) $ ( 18,351 ) $ 142,882

Comprehensive Income:

Net Income — — — 3,219 — — 3,219

Other Comprehensive Income — — — — — 4,441 4,441

Stock-Based Compensation Expense — — 215 — — — 215

Exercise of Stock Options 5,850 3 139 — ( 148 ) — ( 6 )

Treasury stock purchased, at cost ( 18,220 shares)

— — — — ( 326 ) — ( 326 )

Dividends Paid ($ 0.25 Per Share)

— — — ( 1,285 ) — — ( 1,285 )

September 30, 2024 5,789,438 $ 2,413 $ 86,072 $ 89,607 $ ( 15,042 ) $ ( 13,910 ) $ 149,140

Three Months Ended September 30, 2023 Shares Issued Common Stock Capital Surplus Retained Earnings Treasury Stock Accumulated Other Comprehensive Loss Total Stockholders' Equity

(Dollars in thousands, except share and per share data)

June 30, 2023 5,733,408 $ 2,389 $ 84,325 $ 70,314 $ ( 14,100 ) $ ( 26,339 ) $ 116,589

Comprehensive Loss:

Net Income — — — 2,672 — — 2,672

Other Comprehensive Loss — — — — — ( 3,332 ) ( 3,332 )

Restricted Stock Awards Granted 9,000 4 ( 4 ) — — — —

Stock-Based Compensation Expense — — 196 — — — 196

Dividends Paid ($ 0.25 Per Share)

— — — ( 1,279 ) — — ( 1,279 )

September 30, 2023 5,742,408 $ 2,393 $ 84,517 $ 71,707 $ ( 14,100 ) $ ( 29,671 ) $ 114,846

The accompanying notes are an integral part of these consolidated financial statements

Nine Months Ended September 30, 2024 Shares Issued Common Stock Capital Surplus Retained Earnings Treasury Stock Accumulated Other Comprehensive Loss Total Stockholders' Equity

Three Months Ended March 31, 2025 Shares Issued Common Stock Capital Surplus Retained Earnings Treasury Stock Accumulated Other Comprehensive Loss Total Stockholders' Equity

(Dollars in thousands, except share and per share data)

11 unchanged sentences

— — — ( 1,281 ) — — ( 1,281 )

September 30, 2024 5,789,438 $ 2,413 $ 86,072 $ 89,607 $ ( 15,042 ) $ ( 13,910 ) $ 149,140

Nine Months Ended September 30, 2023 Shares Issued Common Stock Capital Surplus Retained Earnings Treasury Stock Accumulated Other Comprehensive Loss Total Stockholders' Equity

March 31, 2025 5,828,717 $ 2,429 $ 86,960 $ 91,484 $ ( 17,214 ) $ ( 15,370 ) $ 148,289

Three Months Ended March 31, 2024 Shares Issued Common Stock Capital Surplus Retained Earnings Treasury Stock Accumulated Other Comprehensive Loss Total Stockholders' Equity

(Dollars in thousands, except share and per share data)

December 31, 2023 5,759,378 $ 2,400 $ 85,334 $ 83,392 $ ( 14,545 ) $ ( 16,747 ) $ 139,834

Adoption of Accounting Standard ASU 2016-13 — — — 2,092 — — 2,092

Balance at January 1, 2023, adjusted 5,708,433 $ 2,379 $ 83,953 $ 65,953 $ ( 13,797 ) $ ( 26,241 ) $ 112,247

Comprehensive Income:

4 unchanged sentences

Stock-Based Compensation Expense — — 178 — — — 178

Exercise of Stock Options — — — — 45 — 45

Treasury Stock Purchased, at cost ( 222 shares)

2 unchanged sentences

— — — ( 1,280 ) — — ( 1,280 )

September 30, 2023 5,742,408 $ 2,393 $ 84,517 $ 71,707 $ ( 14,100 ) $ ( 29,671 ) $ 114,846

March 31, 2024 5,783,788 $ 2,411 $ 85,501 $ 86,308 $ ( 14,550 ) $ ( 18,080 ) $ 141,590

The accompanying notes are an integral part of these consolidated financial statements

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

Nine Months Ended September 30, 2024 2023

Three Months Ended March 31, 2025 2024

(Dollars in thousands)

2 unchanged sentences

Adjustments to Reconcile Net Income to Net Cash Provided By Operating Activities

Net (Accretion) Amortization on Securities ( 564 ) 56

Net Accretion on Securities ( 26 ) ( 212 )

Depreciation and Amortization 442 718

(Recovery) Provision for Credit Losses - Loans ( 105 ) 863

Provision (Recovery) for Credit Losses - Loans 68 ( 143 )

(Recovery) Provision for Credit Losses - Unfunded Commitments ( 108 ) 106

(Gain) Loss on Securities ( 49 ) 369

Loss on Securities 69 166

Gain on Purchased Tax Credits ( 4 ) ( 12 )

3 unchanged sentences

Originations of Mortgage Loans for Sale ( 1,774 ) ( 972 )

(Gain) Loss on Sale of Loans ( 49 ) 3

Loss (Gain) on Sale of Other Real Estate Owned and Repossessed Assets 30 ( 13 )

Gain on Sale of Loans ( 22 ) ( 22 )

Gain on Sale of Other Real Estate Owned and Repossessed Assets — ( 7 )

Noncash Expense for Stock-Based Compensation 223 178

Increase in Accrued Interest Receivable ( 1,160 ) ( 600 )

Valuation adjustment on real estate owned — 119

Decrease (Increase) in Accrued Interest Receivable 57 ( 162 )

Gain on Disposal of Premises and Equipment — ( 274 )

Increase in Deferred Income Tax 1,035 —

Decrease in Taxes Payable ( 4,314 ) ( 632 )

Increase in Accrued Interest Payable

Increase (Decrease) in Deferred Income Tax 510 ( 300 )

Increase in Taxes Payable 384 925

(Decrease) Increase in Accrued Interest Payable ( 46 ) 399

Other, Net 431 ( 1,255 )

4 unchanged sentences

Purchases of Securities ( 10,069 ) ( 19,770 )

Net Decrease (Increase) in Loans 50,551 ( 55,546 )

Proceeds from Sale of Securities 1,680 —

Net Decrease in Loans 7,466 24,482

Purchase of Premises and Equipment ( 101 ) ( 970 )

Proceeds from Disposal of Premises and Equipment — 988

Proceeds From a Claim on Bank-Owned Life Insurance 2,678 731

Investment in Low Income Housing Tax Credit

Proceeds From Sale of Other Real Estate Owned — 169

Decrease (Increase) in Restricted Equity Securities 269 ( 517 )

NET CASH USED IN INVESTING ACTIVITIES ( 8,533 ) ( 44,381 )

Decrease in Restricted Equity Securities 34 177

NET CASH PROVIDED BY INVESTING ACTIVITIES 13,181 8,158

FINANCING ACTIVITIES

Net Increase (Decrease) in Deposits 86,661 ( 32,214 )

Net Decrease in Short-Term Borrowings — ( 8,060 )

Proceeds From Other Borrowed Funds — 20,000

Net Decrease in Deposits ( 2,420 ) ( 4,665 )

Cash Dividends Paid ( 1,281 ) ( 1,280 )

1 unchanged sentence

Exercise of Stock Options 573 —

NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 82,474 ( 24,388 )

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 79,102 ( 51,103 )

NET CASH USED IN FINANCING ACTIVITIES ( 5,506 ) ( 5,950 )

INCREASE IN CASH AND CASH EQUIVALENTS 11,702 5,468

CASH AND DUE FROM BANKS AT BEGINNING OF YEAR 49,572 68,223

2 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

Nine Months Ended September 30, 2024 2023

Three Months Ended March 31, 2025 2024

(Dollars in thousands)

5 unchanged sentences

SUPPLEMENTAL NONCASH DISCLOSURE:

Other Real Estate Acquired in Settlement of Loans 150 248

Transfer of Loans from Loans Held for Sale to Portfolio 403 —

Proceeds Receivable from Claims on Bank-Owned Life Insurance — 2,679

Securities Purchased Not Settled — 10,075

Syndicated Loans Purchased and Sold Not Settled, net 2,985 10,550

Right of Use Asset Recognized — 1,042

Lease Liability Recognized — 1,042

Unfunded Commitment in Low Income Housing Tax Credit

5 unchanged sentences

(“CB Financial”) and its wholly owned subsidiary, Community Bank (the “Bank”), and the Bank’s wholly owned subsidiary, Exchange Underwriters, Inc.

(“Exchange Underwriters”).

(“Exchange Underwriters” or "EU").

CB Financial, the Bank and Exchange Underwriters are collectively referred to as the “Company”.

17 unchanged sentences

This transaction did not meet the criteria for discontinued operations reporting.

During 2024, the Company recognized an additional gain of $ 138,000 following the final settlement of all liabilities and an earn-out payment of $ 708,000 .

Operating Segments

An operating segment is defined as a component of an enterprise that engages in business activities which generate revenue and incur expense, and the operating results of which are reviewed by management.

The Company has evaluated the provisions of ASC Topic 280, Segment Reporting , and determined that at March 31, 2025 and December 31, 2024, the Company had one reportable segment, community banking services.

Critical Accounting Policies;

2 unchanged sentences

Allowance for Credit Losses (ACL)

On January 1, 2023, the Company adopted ASU 2016-13, which replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss methodology.

The Company adopted ASU 2016-13 using a modified retrospective approach.

Results for reporting periods beginning after January 1, 2023 are presented under Topic 326, while prior period amounts continue to be reported in accordance with previously applicable GAAP.

The adoption resulted in a decrease of $ 3.4 million to the Company’s ACL related to loans receivable (ACL - Loans) and an increase of $ 718,000 in ACL for unfunded commitments (ACL - Unfunded Commitments).

The net impact resulted in a $ 2.1 million increase to retained earnings, net of deferred taxes.

The ACL represents the estimated amount considered necessary to cover lifetime expected credit losses inherent in financial assets at the balance sheet date.

The measurement of expected credit losses is applicable to loans receivable and securities

measured at amortized cost.

The measurement of expected credit losses is applicable to loans receivable and securities measured at amortized cost.

It also applies to off-balance sheet credit exposures such as loan commitments and unused lines of credit.

The allowance is established through a provision for credit losses that is charged against income.

The methodology for determining the allowance for credit losses is considered a critical accounting policy by management because of the high degree of judgment involved, the subjectivity of the assumptions used, and the potential for changes in the forecasted economic environment that could result in changes to the amount of the recorded ACL.

The methodology for

determining the allowance for credit losses is considered a critical accounting policy by management because of the high degree of judgment involved, the subjectivity of the assumptions used, and the potential for changes in the forecasted economic environment that could result in changes to the amount of the recorded ACL.

The ACL is reported separately as a contra-asset account on the Consolidated Statement of Financial Condition.

47 unchanged sentences

The Company made an accounting policy election to exclude accrued interest receivable from the amortized cost basis of loans and available-for-sale securities.

Accrued interest receivable on loans is reported as a component of accrued interest receivable and other assets on the Consolidated Statement of Financial Condition, totaled $ 4.0 million at September 30, 2024 and $ 4.1 million at December 31, 2023 and is excluded from the estimate of credit losses.

Accrued interest receivable on available of sale securities, also a component of accrued interest receivable and other assets on the Consolidated Statement of Financial Condition, totaled $ 2.2 million at September 30, 2024 and $ 947,000 at December 31, 2023 and is excluded from the estimate of credit losses.

Accrued interest receivable on loans is reported as a component of accrued interest receivable and other assets on the Consolidated Statement of Financial Condition, totaled $ 4.0 million at March 31, 2025 and $ 3.9 million at December 31, 2024 and is excluded from the estimate of credit losses.

Accrued interest receivable on available-for-sale securities, also a component of accrued interest receivable and other assets on the Consolidated Statement of Financial Condition, totaled $ 1.5 million at March 31, 2025 and $ 1.7 million at December 31, 2024 and is excluded from the estimate of credit losses.

Recent Accounting Standards

In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848):

Deferral of the Sunset Date of Topic 848 that extends the period of time preparers can utilize the reference rate reform relief guidance.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848):

Facilitation of the Effects of Reference Rate Reform on Financial Reporting, as amended.

This ASU provides temporary optional guidance to ease the potential burden in accounting for reference rate reform.

The new guidance provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that reference the London Inter-bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued.

The elective guidance in the ASU applies to modifications of contract terms that will directly replace, or have the potential to replace, an affected rate with another interest rate index, as well as certain contemporaneous modifications of other contract terms related to the replacement of an affected rate.

The ASU notes that changes in contract terms that are made to effect the reference rate reform transition are considered related to the replacement of a reference rate if they are not the result of a business decision that is separate from or in addition to changes to the terms of a contract to effect that transition.

The optional expedient allows companies to account for the modification as if it was not substantial (i.e., do not treat as an extinguishment of debt).

To ensure the relief in Topic 848 covers the period of time during which a significant number of modifications may take place, ASU 2022-06 defers the sunset date of Topic 848 from December 31, 2022 to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848.

For all entities, the amendments in ASU 2022-06 are effective upon issuance.

As of September 30, 2024, the Company does not have any instruments tied to the LIBOR reference rate.

The adoption of this guidance is not expected to have a material effect on the Company's consolidated statements of financial condition and results of operations.

In March 2023, the FASB issued ASU 2023-02, Investments - Equity Method and Joint Ventures (Topic 323):

Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method.

This ASU expanded the use of the proportional amortization method of accounting - previously allowed only for investments in low-income housing tax credit structures - to equity investments in other tax credit structures that meet certain criteria.

Common tax credit programs that investors access via tax equity structures and that may now be eligible for application of the proportional amortization method include:

new markets tax credits, historic rehabilitation tax credit programs and renewable energy tax credit programs.

This ASU took effect in reporting periods beginning after December 15, 2023, with early adoption permitted.

The adoption of this ASU on January 1, 2024, did not have a material impact on the Company's consolidated financial statements.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting - Improvements to Reportable Segment Disclosures (Topic 820), to improve reportable segment disclosures by requiring public entities to disclose significant expense categories and amounts for each reportable segment, where significant expense categories are defined as those that are regularly reported to an entity's chief operating decision-maker and included in a segment's reported measures of profit or loss.

For public companies, the requirements will become effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

The adoption of this ASU is not expected to have a material effect on the Company's consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

5 unchanged sentences

The Company does not expect the adoption of the ASU to have a material effect on the Company's consolidated statements of financial condition and results of operations.

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses (DISE);

this ASU was then superseded by ASU 2025-01, Clarifying the Effective Date , to clarify the effective date for interim reporting.

Collectively, these ASU's require that public entities on an annual and interim basis disclose specific natural expenses contained within each relevant income statement expense caption.

These specified natural expenses are:

purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depreciation, depletion and amortization recognized as part of oil- and gas- producing activities (DD&A).

This ASU is effective for public entities for annual periods beginning after December 15, 2026 and interim reporting periods within annual reporting periods beginning after December 15, 2027.

The Company does not expect the adoption of the ASU to have a material effect on the Company's consolidated statements of financial condition and results of operations.

Earnings Pe r Share

3 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

(Dollars in thousands, except share and per share data)

8 unchanged sentences

$ 0.37 $ 0.82

0.60 0.52 1.89 1.87

The dilutive effect on weighted average diluted common shares outstanding is the result of outstanding stock options and nonvested restricted stock.

1 unchanged sentence

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Stock Options 24,310 315,566

Restricted Stock 25,235 30,385

The following table presents the amortized cost and fair value of securities available-for-sale at the dates indicated:

September 30, 2024

The following tables present the amortized cost and fair value of securities available-for-sale at the dates indicated:

March 31, 2025

(Dollars in thousands)

11 unchanged sentences

Equity Securities:

Total Equity Securities 2,636

Total Securities $ 258,699

16 unchanged sentences

The following tables show the Company’s gross unrealized losses and fair value, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, at the dates indicated:

September 30, 2024

March 31, 2025

Less than 12 months

23 unchanged sentences

16 $ 95,072 $ ( 958 ) 37 $ 93,227 $ ( 21,040 ) 53 $ 188,299 $ ( 21,998 )

For debt securities, the Company does not believe that any individual unrealized loss as of September 30, 2024 or December 31, 2023, represents a credit related impairment.

For debt securities, the Company does not believe that any individual unrealized loss as of March 31, 2025 or December 31, 2024, represents a credit related impairment.

The Company performs a review of the entire securities portfolio on a quarterly basis to identify securities that may indicate a credit related impairment.

The unrealized losses on securities at September 30, 2024 and December 31, 2023 relate principally to changes in market interest rates subsequent to the acquisition of the specific securities.

The Company does not intend to sell, and it is more likely than not that it will be required to sell any of the securities in an unrealized loss position before recovery of its amortized cost or maturity of the security.

Total securities available to be pledged have a fair value of $ 260.3 million at September 30, 2024 and $ 196.8 million at December 31, 2023 of which securities with a fair value of $ 175.1 million and $ 157.3 million at September 30, 2024 and December 31, 2023, respectively, were pledged to secure uninsured public deposits, borrowings or for other purposes as required or permitted by law.

The unrealized losses on securities at March 31, 2025 and December 31, 2024 relate principally to changes in market interest rates subsequent to the acquisition of the specific securities.

The Company does not intend to sell, and it is not more likely than not that it will be required to sell any of the securities in an unrealized loss position before recovery of its amortized cost or maturity of the security.

Total securities available to be pledged have a fair value of $ 239.8 million at March 31, 2025 and $ 251.3 million at December 31, 2024 of which securities with a fair value of $ 163.1 million and $ 176.2 million at March 31, 2025 and December 31, 2024, respectively, were pledged to secure uninsured public deposits, borrowings or for other purposes as required or permitted by law.

The scheduled maturities of securities available-for-sale are summarized as follows.

2 unchanged sentences

however, regular principal payments and prepayments of principal are received on a monthly basis.

September 30, 2024

March 31, 2025

(Dollars in thousands)

6 unchanged sentences

$ 277,340 $ 257,809

The following table presents the gain and loss on equity securities from both realized sales and unrealized market adjustments for the periods indicated.

The following table presents the loss on equity securities from both realized sales and unrealized market adjustments for the periods indicated.

There was no realized gain or loss on sales of debt securities for the periods indicated.

All gains and losses presented in the table below are reported in Net Gain (Loss) on Securities on the Consolidated Statements of Income.

All losses presented in the table below are reported in Net Loss on Securities on the Consolidated Statements of Income.

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

(Dollars in thousands)

Equity Securities

Net Unrealized Gain (Loss) Recognized on Securities Held $ 245 $ ( 37 ) $ 49 $ ( 369 )

Net Realized Gain Recognized on Securities Sold — — — —

Net Gain (Loss) on Equity Securities $ 245 $ ( 37 ) $ 49 $ ( 369 )

Net Gain (Loss) on Securities $ 245 $ ( 37 ) $ 49 $ ( 369 )

Net Unrealized Loss Recognized on Securities Held $ ( 56 ) $ ( 166 )

Net Realized Loss Recognized on Securities Sold ( 13 ) —

Net Loss on Equity Securities $ ( 69 ) $ ( 166 )

Net Loss on Securities $ ( 69 ) $ ( 166 )

Loans and Allowance for Credit Losses

8 unchanged sentences

Commercial real estate loans generally present a higher level of credit risk than loans secured by residences.

This greater risk is due to several factors, including the concentration of principal in a limited number of loans and borrowers, the effect of general economic conditions on income-producing properties, and the increased difficulty in evaluating and monitoring these types of

Furthermore, the repayment of commercial real estate loans is typically dependent upon the successful operation of the related real estate project.

Furthermore, the repayment of commercial real estate loans is typically dependent upon the successful operation of the

related real estate project.

If the cash flow from the project is reduced (for example, if leases are not obtained or renewed, a bankruptcy court modifies a lease term, or a major tenant is unable to fulfill its lease obligations), the borrower’s ability to repay the loan may be impaired.

7 unchanged sentences

The following table presents the classifications of loans as of the dates indicated:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

(Dollars in thousands)

9 unchanged sentences

$ 1,078,675 $ 1,082,821

Total unamortized net deferred loan fees were $ 714,000 and $ 1.0 million at September 30, 2024 and December 31, 2023, respectively.

Included in total loans above are unamortized net deferred loan fees of $ 896 ,000 and $ 846 ,000 at March 31, 2025 and December 31, 2024, respectively.

The Company uses a nine-point internal risk rating system to monitor the credit quality of the overall loan portfolio.

7 unchanged sentences

There were no loans in the criticized category of Loss.

Classified Loans by Origination Year (as of September 30, 2024)

Classified Loans by Origination Year (as of March 31, 2025)

(dollars in thousands) 2025 2024 2023 2022 2021 Prior Revolving Loans Amortized Cost Basis Total

80 unchanged sentences

The following tables present the classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans as of the dates indicated:

September 30, 2024

March 31, 2025

(Dollars in Thousands)

17 unchanged sentences

$ 1,084,733 $ 4,101 $ 2,003 $ — $ 6,104 $ 1,789 $ 1,092,626

Additional interest income that would have been recorded if the loans that were nonaccrual at September 30, 2024 were current was $ 16,000 and $ 58,000 for the three and nine months ended September 30, 2024, respectively, and $ 41,000 and $ 127,000 for the three and nine months ended September 30, 2023, respectively.

The following table sets forth the amounts for amortized cost basis of loans on nonaccrual status, loans past due 90 days still accruing, and categories of nonperforming assets at the date indicated.

September 30, 2024

Additional interest income that would have been recorded if the loans that were nonaccrual at March 31, 2025 were current was $ 52,000 for the three months ended March 31, 2025, and $ 20,000 for the three months ended March 31, 2024.

The following table sets forth the amounts for amortized cost basis of loans on nonaccrual status, loans past due 90 days still accruing, and categories of nonperforming assets at the dates indicated.

March 31, 2025

Nonaccrual With No ACL Nonaccrual With ACL Loans Past Due 90 Days Still Accruing Total Nonperforming Assets

2 unchanged sentences

$ 2,050 $ — $ — $ 2,050

Construction — — — —

Commercial and Industrial

Total Nonaccrual Loans

$ 2,369 $ — $ — 2,369

Other Real Estate Owned:

Total Other Real Estate Owned —

5 unchanged sentences

$ 1,388 $ — $ — $ 1,388

Commercial and Industrial

Total Nonaccrual Loans

$ 1,789 $ — $ — 1,789

Other Real Estate Owned:

Total Other Real Estate Owned —

Total Nonperforming Assets

No interest income on nonaccrual loans was recognized during the three and nine months ended September 30, 2024 and September 30, 2023.

No interest income on nonaccrual loans was recognized during the three months ended March 31, 2025 and March 31, 2024.

All modifications and refinancing, including those with borrowers that are experiencing financial difficulty are subject to the modification guidance in ASC 310-20.

3 unchanged sentences

Additionally, the effective interest rate should be recalculated based on the amortized cost basis of the new loan and a reassessment of contractual cash flow.

For the three and nine months ended September 30, 2024 and September 30, 2023, there were no new loan modifications to borrowers experiencing financial difficulty.

The recorded investment of residential real estate loans for which formal foreclosure proceedings were in process according to applicable requirements of the local jurisdiction was $ 1.3 million and $ 907,000 at September 30, 2024 and December 31, 2023, respectively.

For the three months ended March 31, 2025 and March 31, 2024, there were no new loan modifications to borrowers experiencing financial difficulty.

The recorded investment of residential real estate loans for which formal foreclosure proceedings were in process according to applicable requirements of the local jurisdiction was $ 720 ,000 and $ 1.2 million at March 31, 2025 and December 31, 2024, respectively.

The activity in the ACL - Loans is summarized below by primary segments for the periods indicated:

(Dollars in thousands)

June 30, 2024 $ 2,844 $ 3,082 $ 744 $ 1,485 $ 1,131 $ 241 $ 9,527

December 31, 2024 $ 2,926 $ 3,103 $ 1,264 $ 1,584 $ 687 $ 241 $ 9,805

— — — — ( 135 ) — ( 135 )

1 unchanged sentence

(Recovery) Provision for Credit Losses - Loans ( 31 ) 25 ( 37 ) 121 ( 3 ) ( 7 ) 68

September 30, 2024 $ 2,618 $ 3,703 $ 693 $ 1,282 $ 923 $ 260 $ 9,479

March 31, 2025 $ 2,896 $ 3,128 $ 1,227 $ 1,748 $ 586 $ 234 $ 9,819

Residential Real

3 unchanged sentences

(Dollars in thousands)

June 30, 2023 $ 2,356 $ 3,216 $ 938 $ 2,140 $ 1,848 $ 168 $ 10,666

December 31, 2023 $ 3,129 $ 2,630 $ 639 $ 1,693 $ 1,367 $ 249 $ 9,707

Charge-offs ( 1 ) — — ( 12 ) ( 50 ) — ( 63 )

Recoveries 11 — — 43 27 — 81

Provision (Recovery) for Credit Losses - Loans 625 104 102 ( 317 ) ( 272 ) 49 291

September 30, 2023 $ 2,899 $ 3,329 $ 1,040 $ 1,919 $ 1,444 $ 217 $ 10,848

(Dollars in thousands)

December 31, 2023 $ 3,129 $ 2,630 $ 639 $ 1,693 $ 1,367 $ 249 $ 9,707

— — — ( 12 ) ( 365 ) — ( 377 )

13 — — 132 109 — 254

(Recovery) Provision for Credit Losses - Loans ( 307 ) 318 231 ( 137 ) ( 260 ) 12 ( 143 )

September 30, 2024 $ 2,618 $ 3,703 $ 693 $ 1,282 $ 923 $ 260 $ 9,479

(Dollars in thousands)

December 31, 2022 $ 2,074 $ 5,810 $ 502 $ 2,313 $ 1,517 $ — $ 603 $ 12,819

Impact of ASC 326 - Loans 137 ( 3,244 ) 488 ( 1,057 ) 774 120 ( 603 ) ( 3,385 )

( 206 ) — — — ( 272 ) — — ( 478 )

41 32 — 862 94 — — 1,029

Provision (Recovery) for Credit Losses - Loans 853 731 50 ( 199 ) ( 669 ) 97 — 863

September 30, 2023 $ 2,899 $ 3,329 $ 1,040 $ 1,919 $ 1,444 $ 217 $ — $ 10,848

March 31, 2024 $ 2,832 $ 2,948 $ 870 $ 1,587 $ 1,084 $ 261 $ 9,582

Loans that do not share risk characteristics are evaluated on an individual basis.

For loans that are individually evaluated and collateral dependent, financial loans where the Company has determined that foreclosure of the collateral is probable, or where the borrower is experiencing financial difficulty and the Company expects repayment of the financial asset to be provided substantially through the operation or sale of the collateral, the ACL - Loans is measured based on the difference between the fair value of the collateral and the amortized cost basis of the asset as of the measurement date.

During the three and nine months ended September 30, 2024 and September 30, 2023, there were no loans that required a credit loss to be individually assigned.

During the three months ended March 31, 2025, there were $ 7.9 million of loans that required specific valuation allowances of $ 570 ,000.

During the three months ended March 31, 2024, there were no loans that required a credit loss to be individually assigned.

The Company’s allowance for credit losses on unfunded commitments is recognized as a liability (accrued interest payable and other liabilities on the Consolidated Statement of Financial Condition), with adjustments to the reserve recognized in provision for credit losses - unfunded commitments on the Consolidated Statement of Income.

1 unchanged sentence

(in thousands) Allowance for Credit Losses

Balance at June 30, 2024

Recovery for Credit Losses - Unfunded Commitments ( 66 )

Balance at September 30, 2024 $ 491

(in thousands) Allowance for Credit Losses

Balance at June 30, 2023 $ 658

Provision for Credit Losses - Unfunded Commitments 115

Balance at September 30, 2023 $ 773

(in thousands) Allowance for Credit Losses

Balance at December 31, 2024

Recovery for Credit Losses - Unfunded Commitments ( 108 )

Balance at September 30, 2024 $ 491

Balance at March 31, 2025 $ 583

(in thousands) Allowance for Credit Losses

Balance at December 31, 2023 $ 500

Impact of CECL Adoption 719

Provision for Credit Losses - Unfunded Commitments 106

Balance at September 30, 2023 $ 773

Balance at March 31, 2024 $ 606

Derivatives and Hedging Activities

8 unchanged sentences

These adjustments are included in Accrued Interest Payable and Other Liabilities on the Company's Consolidated Statement of Financial Condition.

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

(Dollars in Thousands)

26 unchanged sentences

These instruments are classified as Level 2.

There were no transfers into or out of Level 3 during the nine months ended September 30, 2024 or year ended December 31, 2023.

There were no transfers into or out of Level 3 during the three months ended March 31, 2025 or year ended December 31, 2024.

The following table presents the financial assets measured at fair value on a recurring basis and reported on the Consolidated Statements of Financial Condition as of the dates indicated, by level within the fair value hierarchy:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

(Dollars in thousands)

22 unchanged sentences

The table also presents the significant unobservable inputs used in the fair value measurements.

Financial Asset Fair Value Hierarchy March 31,

2025 Valuation

Techniques Significant Unobservable Inputs Range Weighted Average

(Dollars in thousands)

Individually Evaluated Loans Level 3 $ 7,284 Appraisal of Collateral (1)

Appraisal Adjustments (2)

24 % to 100 % 26.5 %

Financial Asset Fair Value Hierarchy December 31,

2 unchanged sentences

(Dollars in thousands)

OREO Level 3 $ — Appraisal of Collateral (1)

Liquidation Expenses (2)

Individually Evaluated Loans Level 3 $ 5,244 Appraisal of Collateral (1)

Appraisal Adjustments (2)

25 % to 52 % 26.2 %

2 unchanged sentences

The range and weighted average of appraisal adjustments and liquidation expense are presented as a percent of the appraisal.

Collateral dependent impaired loans are evaluated and valued at the time the loan is identified as impaired at the lower of cost or fair value.

Individually evaluated loans are evaluated and valued at the time the loan is identified as impaired, at the lower of cost or fair value.

Fair value is measured based on the value of the collateral securing the loans and is classified as Level 3 in the fair value hierarchy.

At September 30, 2024 and December 31, 2023, the Company did not have any loans that would be required to be remeasured.

At March 31, 2025, the fair value of these loans consisted of loan balances of $ 7.9 million less specific valuation allowances of $ 570 ,000.

At December 31, 2024, the fair value of these loans consisted of loan balances of $ 5.6 million less specific valuation allowances of $ 398 ,000.

The fair value of mortgage servicing rights ("MSRs") is determined by calculating the present value of estimated future net servicing cash flows, considering expected mortgage loan prepayment rates, discount rates, servicing costs and other economic factors, which are determined based on current market conditions.

2 unchanged sentences

Since the valuation model includes significant unobservable inputs as listed above, MSRs are classified as Level 3.

At September 30, 2024 and December 31, 2023, the Company did not have any MSRs that would be required to be remeasured.

At March 31, 2025 and December 31, 2024, the Company did not have any MSRs that would be required to be remeasured.

Other real estate owned ("OREO") properties are evaluated at the time of acquisition and recorded at fair value, less estimated selling costs.

1 unchanged sentence

The fair value of an OREO property is determined from a qualified independent appraisal and is classified as Level 3 in the fair value hierarchy.

As of September 30, 2024 the Company did not have any OREO that would be required to be remeasured.

At December 31, 2023, OREO measured at fair value less costs to sell had no net carrying value, which consisted of the outstanding balance of $ 37,000 less write-downs of $ 37,000 .

As of March 31, 2025 and December 31, 2024, the Company did not have any OREO that would be required to be remeasured.

Financial instruments are defined as cash, evidence of an ownership in an entity, or a contract which creates an obligation or right to receive or deliver cash or another financial instrument from/to a second entity on potentially favorable or unfavorable terms.

5 unchanged sentences

The following table presents the estimated fair values of the Company’s financial instruments at the dates indicated.

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

(Dollars in thousands)

35 unchanged sentences

The following table presents the unused and available credit balances of financial instruments whose contracts represent credit risk at the dates indicated:

September 30,

2025 December 31,

23 unchanged sentences

For secured letters of credit, the collateral is typically Company deposit instruments or customer business assets.

The Company recorded no liability associated with standby letters of credit as of September 30, 2024 and December 31, 2023.

The Company recorded no liability associated with standby letters of credit as of March 31, 2025 and December 31, 2024.

The Company evaluates all contracts at commencement to determine if a lease is present.

5 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

(Dollars in thousands)

2 unchanged sentences

Total Lease Expense $ 129 $ 85

September 30,

2025 December 31,

4 unchanged sentences

Weighted Average Discount Rate 4.20 % 4.18 %

September 30,

(Dollars in thousands)

9 unchanged sentences

Lease Liabilities $ 2,808

On March 29, 2024, the Bank completed the sale and leaseback of a branch office located in Rostraver, Pennsylvania, for a sales price of $ 1.1 million.

There were no new lease agreements which commenced during the three months ended March 31, 2025.

During the three months ended March 31, 2024, the Bank completed the sale and leaseback of a branch office located in Rostraver, Pennsylvania, for a sales price of $ 1.1 million.

As a result, the Bank recorded a pre-tax net gain of $ 274,000 .

2 unchanged sentences

The Bank recorded an operating lease ROU asset and corresponding lease liability of $ 1.0 million.

On April 8, 2024, the Bank entered into a lease agreement under which the Bank will lease retail property for the operation of a full-service branch office located in Uniontown, Pennsylvania.

The lease agreement is for an initial term of five years with specified renewal options.

The lease agreement includes a 2.5 % annual rent escalation during the initial term and renewal terms, if exercised.

The Bank recorded an operating lease ROU asset and corresponding lease liability of $ 410,000 .

There were no new lease agreements which commenced during the nine months ended September 30, 2023.

Segment and Related Information

At September 30, 2024, the Company’s business activities were comprised of one operating segment, which is community banking.

In prior reporting periods, the Company's business activities were comprised of two operating segments, community banking and insurance brokerage services.

CB Financial is the parent company of the Bank and Exchange Underwriters ("EU"), a wholly owned subsidiary of the Bank.

EU had an independent board of directors from the Company and was managed separately from the banking and related financial services that the Company offers.

EU was an independent insurance agency that offered property, casualty, commercial liability, surety and other insurance products.

On December 1, 2023, the Company announced that the Bank and EU entered into an Asset Purchase Agreement with World Insurance Associates, LLC ("World") pursuant to which EU sold substantially all of its assets to World for a purchase price of $ 30.5 million cash plus possible additional earn-out payments.

The sale of assets was completed on December 8, 2023 and resulted in a pre-tax gain of $ 24.6 million.

Assets remaining in the EU subsidiary at September 30, 2024 and December 31, 2023 consisted primarily of cash received from the sale of assets.

The EU subsidiary is expected to be merged into the Bank, with the remaining assets and liabilities being transferred to the Bank during 2025.

The following is a table of selected financial data for the Company’s subsidiaries and consolidated results at the dates and for the periods indicated:

Community Bank Exchange Underwriters, Inc.

CB Financial Services, Inc.

Net Eliminations Consolidated

(Dollars in thousands)

September 30, 2024

Assets $ 1,559,417 $ 26,182 $ 164,038 $ ( 187,896 ) $ 1,561,741

Liabilities 1,412,694 4,818 14,898 ( 19,809 ) 1,412,601

Stockholders' Equity 146,723 21,364 149,140 ( 168,087 ) 149,140

December 31, 2023

Assets $ 1,452,469 $ 28,830 $ 154,698 $ ( 179,906 ) $ 1,456,091

Liabilities 1,315,110 7,571 14,864 ( 21,288 ) 1,316,257

Stockholders' Equity 137,359 21,259 139,834 ( 158,618 ) 139,834

Three Months Ended September 30, 2024

Interest and Dividend Income $ 19,752 $ — $ 1,306 $ ( 1,285 ) $ 19,773

Interest Expense 8,144 — 155 — 8,299

Net Interest and Dividend Income 11,608 — 1,151 ( 1,285 ) 11,474

Provision for Credit Losses - Loans 25 — — — 25

Recovery for Credit Losses - Unfunded Commitments ( 66 ) — — — ( 66 )

Net Interest and Dividend Income After Net Recovery for Credit Losses 11,649 — 1,151 ( 1,285 ) 11,515

Noninterest Income 874 146 213 — 1,233

Noninterest Expense 8,777 — 5 — 8,782

Undistributed Net Income of Subsidiary 106 — 1,876 ( 1,982 ) —

Income Before Income Tax Expense 3,852 146 3,235 ( 3,267 ) 3,966

Income Tax Expense 691 40 16 — 747

Net Income $ 3,161 $ 106 $ 3,219 $ ( 3,267 ) $ 3,219

Nine Months Ended September 30, 2024

Interest and Dividend Income $ 56,636 $ — $ 3,914 $ ( 3,851 ) $ 56,699

Interest Expense 21,698 — 465 — 22,163

Net Interest and Dividend Income 34,938 — 3,449 ( 3,851 ) 34,536

Recovery for Credit Losses - Loans ( 105 ) — — — ( 105 )

Recovery for Credit Losses - Unfunded Commitments ( 9 ) — — — ( 9 )

Net Interest and Dividend Income After Recovery for Credit Losses 35,052 — 3,449 ( 3,851 ) 34,650

Noninterest Income 3,662 146 31 — 3,839

Noninterest Expense 26,178 — 19 — 26,197

Undistributed Net Income of Subsidiary 106 — 6,526 ( 6,632 ) —

Income Before Income Tax Expense (Benefit) 12,642 146 9,987 ( 10,483 ) 12,292

Income Tax Expense (Benefit) 2,265 40 ( 78 ) — 2,227

Net Income $ 10,377 $ 106 $ 10,065 $ ( 10,483 ) $ 10,065

Community Bank Exchange Underwriters, Inc.

CB Financial Services, Inc.

Net Eliminations Consolidated

(Dollars in thousands)

Three Months Ended September 30, 2023

Interest and Dividend Income $ 15,853 $ 1 $ 1,298 $ ( 1,278 ) $ 15,874

Interest Expense 5,002 — 155 — 5,157

Net Interest and Dividend Income 10,851 1 1,143 ( 1,278 ) 10,717

Provision for Credit Losses - Loans 291 — — — 291

Provision for Credit Losses - Unfunded Commitments 115 — — — 115

Net Interest and Dividend Income After Provision for Credit Losses 10,445 1 1,143 ( 1,278 ) 10,311

Noninterest Income (Loss) 1,006 1,436 ( 30 ) — 2,412

Noninterest Expense 8,344 1,137 6 — 9,487

Undistributed Net Income of Subsidiary 214 — 1,529 ( 1,743 ) —

Income Before Income Tax Expense (Benefit) 3,321 300 2,636 ( 3,021 ) 3,236

Income Tax Expense (Benefit) 514 86 ( 36 ) — 564

Net Income $ 2,807 $ 214 $ 2,672 $ ( 3,021 ) $ 2,672

Nine Months Ended September 30, 2023

Interest and Dividend Income $ 45,257 $ 5 $ 3,889 $ ( 3,830 ) $ 45,321

Interest Expense 11,436 — 466 — 11,902

Net Interest and Dividend Income 33,821 5 3,423 ( 3,830 ) 33,419

Provision for Credit Losses - Loans 863 — — — 863

Provision for Credit Losses - Unfunded Commitments 54 — — — 54

Net Interest and Dividend Income After Provision for Credit Losses 32,904 5 3,423 ( 3,830 ) 32,502

Noninterest Income (Loss) 2,918 4,937 ( 362 ) — 7,493

Noninterest Expense 24,725 3,281 11 — 28,017

Undistributed Net Income of Subsidiary 1,179 — 6,372 ( 7,551 ) —

Income Before Income Tax Expense (Benefit) 12,276 1,661 9,422 ( 11,381 ) 11,978

Income Tax Expense (Benefit) 2,074 482 ( 164 ) — 2,392

Net Income $ 10,202 $ 1,179 $ 9,586 $ ( 11,381 ) $ 9,586

Operating segments are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (CODM) in deciding how to allocate resources and in assessing performance.

The Company's President and Chief Executive Officer functions as its CODM.

At March 31, 2025 and December 31, 2024, the Company had one reportable segment, community banking services, upon which the CODM makes decisions regarding how to allocate resources and assess performance.

Individual bank branches offer a group of similar services, including commercial, real estate and consumer loans, time deposits, checking and savings accounts all with similar operating and economic characteristics.

While the CODM monitors the revenue streams of the various products and services, operations are managed and financial performance is evaluated on a Company-wide basis.

The CODM uses net interest income, noninterest income and net income to evaluate income generated from segment assets in deciding whether to reinvest profits into the Company, pursue acquisitions or pay out dividends.

Net income is used to monitor budget versus actual results.

These metrics and the Company's significant expense categories are disclosed on the Company's Consolidated Statements of Income.

Stock Based Compensation

3 unchanged sentences

Outstanding Options at December 31, 2024 377,088 $ 23.65 5.7

Granted 93,950 22.12

Exercised ( 24,413 ) 23.51

Forfeited ( 31,792 ) 23.05

Outstanding Options at September 30, 2024 403,348 $ 23.58 5.7

Exercisable Options at September 30, 2024 212,034 $ 24.21 3.2

Outstanding Options at March 31, 2025 320,883 $ 23.72 5.1

Exercisable Options at March 31, 2025 200,163 $ 24.32 3.3

Number of Shares Weighted Average Exercise Price Weighted Average Remaining Service Period in Years

Nonvested Options at September 30, 2024 190,973 $ 22.89 8.6

Summary of Significant Assumptions for Newly Issued Stock Options

Expected Term in Years 6.5

Expected Volatility 30.4 %

Expected Dividends $ 1.00

Risk Free Rate of Return 3.98 %

Weighted Average Grant Date Fair Value (per share) $ 4.81

Nonvested Options at March 31, 2025 120,720 $ 22.74 8.1

The following table presents restricted stock award information for the period indicated:

4 unchanged sentences

Forfeited ( 310 ) 21.50

Nonvested Restricted Stock at September 30, 2024 81,364 $ 22.84 3.0

Nonvested Restricted Stock at March 31, 2025 74,091 $ 25.26 3.5

The Company recognizes expense over a five-year vesting period for the restricted stock awards and stock options.

Stock-based compensation expense related to restricted stock awards and stock options was $ 215,000 and $ 196,000 for the three months ended September 30, 2024 and 2023.

Stock-based compensation expense was $ 591,000 and $ 557,000 for the nine months ended September 30, 2024 and 2023.

As of September 30, 2024 and December 31, 2023, total unrecognized compensation expense was $ 761,000 and $ 505,000 , respectively, related to stock options, and $ 1.5 million and $ 1.4 million, respectively, related to restricted stock awards.

Intrinsic value represents the amount by which the fair value of the underlying stock at September 30, 2024 and December 31, 2023 exceeds the exercise price of the stock options.

The intrinsic value of stock options was $ 1.8 million and $ 335,000 at September 30, 2024 and December 31, 2023, respectively.

At September 30, 2024 there were 287,500 shares of common stock available and reserved under the 2024 Plan to be issued as restricted stock awards or units based on the terms of the Plan.

At September 30, 2024, no shares have been granted under the 2024 Plan.

Under the 2021 Plan, there were 161,464 shares available at December 31, 2023 to be issued in connection with the exercise of stock options, and 64,586 shares to be issued as restricted stock awards or units.

The 2021 Plan shall remain in effect

as long as any awards are outstanding, but as a result of the approval of the 2024 Plan, no more awards can be granted under the 2021 Plan.

Stock-based compensation expense related to restricted stock awards and stock options was $ 223,000 and $ 178,000 for the three months ended March 31, 2025 and 2024.

Stock-based compensation expense was $ 223,000 and $ 178,000 for the three months ended March 31, 2025 and 2024.

As of March 31, 2025 and December 31, 2024, total unrecognized compensation expense was $ 535,000 and $ 701 ,000, respectively, related to stock options, and $ 1.8 million and $ 1.2 million, respectively, related to restricted stock awards.

Intrinsic value represents the amount by which the fair value of the underlying stock at March 31, 2025 and December 31, 2024 exceeds the exercise price of the stock options.

The intrinsic value of stock options was $ 1.6 million and $ 1.9 million at March 31, 2025 and December 31, 2024, respectively.

At March 31, 2025 and December 31, 2024, there were 262,265 and 287,500 shares of common stock available and reserved under the 2024 Plan to be issued as restricted stock awards or units based on the terms of the Plan.

At March 31, 2025, 25,235 shares have been granted under the 2024 Plan.

The 2021 Plan shall remain in effect as long as any awards are outstanding, but as a result of the approval of the 2024 Plan, no more awards can be granted under the 2021 Plan.

Variable Interest Entities

10 unchanged sentences

The following table presents the balances of the Company's LIHTC investments and related unfunded commitments:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

(Dollars in thousands)

5 unchanged sentences

Under this method, an entity amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received and recognizes the net investment performance as a component of income tax expense.

During the three and nine month periods ended September 30, 2024 and 2023, there were no tax credits, other tax benefits or investment amortization recognized as the investment fund is not yet closed.

The following table presents other information related to the Company's low income housing tax credit investments:

Three Months Ended March 31,

(dollars in thousands)

Tax Credits and Other Tax Benefits Recognized $ 50 $ —

Proportional Amortization Expense Included in Provision for Income Taxes $ 39 $ —

Subsequent Events

1 unchanged sentence

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