CB Financial Services, Inc. 10-Q

Item 1. Financial Statements. CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited) March 31, 2026 December 31, 2025 (Dollars in Thousands, except per share and share data) ASSETS Cash and Due From Banks: Interest-Earning $ 42,849 $ 18,374 Noninterest-Earning 12,700 13,319 Total Cash and Due From Banks 55,549 31,693 Securities: Available-for-Sale Debt Securities, at Fair Value 294,535 278,986 Equity Securities, at Fair Value 917 909 Total Securities 295,452 279,895 Loans, Net of Allowance for Credit Losses of $ 10,303 and $ 10,116 at March 31, 2026 and December 31, 2025, Respectively 1,147,534 1,152,144 Premises and Equipment, Net 19,428 19,646 Bank-Owned Life Insurance 24,964 24,812 Goodwill 9,732 9,732 Accrued Interest Receivable and Other Assets 30,633 29,771 TOTAL ASSETS $ 1,583,292 $ 1,547,693 LIABILITIES Deposits: Noninterest-Bearing Demand Accounts $ 301,053 $ 291,745 Interest-Bearing Demand Accounts 384,599 357,134 Money Market Accounts 209,258 209,166 Savings Accounts 172,172 169,307 Time Deposits 308,355 312,453 Total Deposits 1,375,437 1,339,805 Other Borrowings 34,768 34,758 Accrued Interest Payable and Other Liabilities 14,336 15,593 TOTAL LIABILITIES 1,424,541 1,390,156 STOCKHOLDERS' EQUITY Common Stock, $ 0.4167 Par Value; 35,000,000 Shares Authorized, 5,876,197 Shares Issued and 5,072,183 Shares Outstanding at March 31, 2026, with 5,835,325 and 5,036,509 Shares Issued and Outstanding at December 31, 2025. 2,449 2,432 Capital Surplus 88,083 87,644 Retained Earnings 93,081 90,625 Treasury Stock, at Cost ( 804,014 and 798,816 Shares at March 31, 2026 and December 31, 2025, Respectively) ( 19,947 ) ( 19,752 ) Accumulated Other Comprehensive Loss ( 4,915 ) ( 3,412 ) TOTAL STOCKHOLDERS' EQUITY 158,751 157,537 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,583,292 $ 1,547,693 The accompanying notes are an integral part of these consolidated financial statements 1 Table of Contents CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) Three Months Ended March 31, 2026 2025 (Dollars in Thousands, except share and per share data) INTEREST AND DIVIDEND INCOME Loans, Including Fees $ 15,957 $ 14,528 Investment Securities: Taxable 2,999 2,777 Tax-Exempt 416 — Dividends 7 28 Other Interest and Dividend Income 272 514 TOTAL INTEREST AND DIVIDEND INCOME 19,651 17,847 INTEREST EXPENSE Deposits 5,232 6,111 Short-Term Borrowings 188 23 Other Borrowings 359 402 TOTAL INTEREST EXPENSE 5,779 6,536 NET INTEREST AND DIVIDEND INCOME 13,872 11,311 Provision for Credit Losses - Loans 228 68 Provision (Recovery) for Credit Losses - Unfunded Commitments 13 ( 108 ) NET INTEREST AND DIVIDEND INCOME AFTER NET PROVISION (RECOVERY) FOR CREDIT LOSSES 13,631 11,351 NONINTEREST INCOME Service Fees 554 462 Other Commissions 76 64 Net Gain on Sale of Loans 11 22 Net Gain (Loss) on Investment Securities 8 ( 69 ) Net Gain on Purchased Tax Credits 10 4 Income from Bank-Owned Life Insurance 152 149 Other Income 151 155 TOTAL NONINTEREST INCOME 962 787 NONINTEREST EXPENSE Salaries and Employee Benefits 5,997 6,036 Occupancy 656 750 Equipment 349 330 Data Processing 942 797 Federal Deposit Insurance Corporation Assessment 173 176 Pennsylvania Shares Tax 286 257 Contracted Services 405 310 Legal and Professional Fees 221 262 Advertising 142 119 Other Expense 841 765 TOTAL NONINTEREST EXPENSE 10,012 9,802 Income Before Income Tax Expense 4,581 2,336 Income Tax Expense 714 427 Net Income $ 3,867 $ 1,909 EARNINGS PER SHARE Basic $ 0.77 $ 0.37 Diluted 0.73 0.35 WEIGHTED AVERAGE SHARES OUTSTANDING Basic 5,053,586 5,125,577 Diluted 5,318,874 5,471,006 The accompanying notes are an integral part of these consolidated financial statements 2 Table of Contents CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) Three Months Ended March 31, 2026 2025 (Dollars in Thousands) Net Income $ 3,867 $ 1,909 Other Comprehensive (Loss) Income: Change in Unrealized Loss on Available-for-Sale Debt Securities ( 1,909 ) 2,371 Income Tax Effect 406 ( 506 ) Other Comprehensive (Loss) Income, Net of Income Tax Effect ( 1,503 ) 1,865 Total Comprehensive Income $ 2,364 $ 3,774 The accompanying notes are an integral part of these consolidated financial statements 3 Table of Contents CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED) Three Months Ended March 31, 2026 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, 2025 5,835,325 $ 2,432 $ 87,644 $ 90,625 $ ( 19,752 ) $ ( 3,412 ) $ 157,537 Comprehensive Income: Net Income — — — 3,867 — — 3,867 Other Comprehensive Loss — — — — — ( 1,503 ) ( 1,503 ) Restricted Stock Awards Granted 30,425 13 ( 13 ) — — — — Stock-Based Compensation Expense — — 212 — — — 212 Exercise of Stock Options 10,447 4 240 — 97 — 341 Treasury stock purchased, at cost ( 8,553 shares) — — — — ( 292 ) — ( 292 ) Dividends Paid ($ 0.28 Per Share) — — — ( 1,411 ) — — ( 1,411 ) March 31, 2026 5,876,197 $ 2,449 $ 88,083 $ 93,081 $ ( 19,947 ) $ ( 4,915 ) $ 158,751 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) December 31, 2024 5,787,744 $ 2,412 $ 86,373 $ 90,856 $ ( 15,028 ) $ ( 17,235 ) $ 147,378 Comprehensive Income: Net Income — — — 1,909 — — 1,909 Other Comprehensive Income — — — — — 1,865 1,865 Restricted Stock Awards Forfeited ( 200 ) — 2 — ( 2 ) — — Restricted Stock Awards Granted 25,235 10 ( 10 ) — — — — Stock-Based Compensation Expense — — 223 — — — 223 Exercise of Stock Options 15,938 7 372 — 194 — 573 Treasury Stock Purchased, at cost ( 82,923 shares) — — — — ( 2,378 ) — ( 2,378 ) Dividends Paid ($ 0.25 Per Share) — — — ( 1,281 ) — — ( 1,281 ) March 31, 2025 5,828,717 $ 2,429 $ 86,960 $ 91,484 $ ( 17,214 ) $ ( 15,370 ) $ 148,289 The accompanying notes are an integral part of these consolidated financial statements 4 Table of Contents CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) Three Months Ended March 31, 2026 2025 (Dollars in Thousands) OPERATING ACTIVITIES Net Income $ 3,867 $ 1,909 Adjustments to Reconcile Net Income to Net Cash Provided By Operating Activities Net Accretion on Securities ( 260 ) ( 26 ) Depreciation and Amortization 445 442 Provision for Credit Losses - Loans 228 68 Provision (Recovery) for Credit Losses - Unfunded Commitments 13 ( 108 ) Net Loss on Sale of Equity Securities — 13 Net Unrealized (Gain) Loss Recognized on Equity Securities ( 8 ) 56 Gain on Purchased Tax Credits ( 10 ) ( 4 ) Income from Bank-Owned Life Insurance ( 152 ) ( 149 ) Proceeds From Mortgage Loans Sold 303 2,063 Originations of Mortgage Loans for Sale ( 292 ) ( 1,774 ) Net Gain on Sale of Loans ( 11 ) ( 22 ) Noncash Expense for Stock-Based Compensation 212 223 (Increase) Decrease in Accrued Interest Receivable ( 77 ) 57 (Benefit) Provision in Deferred Income Tax ( 406 ) 510 Increase in Taxes Payable 623 384 Payments on Operating Leases — Decrease in Accrued Interest Payable ( 101 ) ( 46 ) Other, Net ( 1,356 ) 431 Net Cash Provided by Operating Activities 3,018 4,027 INVESTING ACTIVITIES Investment Securities Available for Sale: Proceeds From Principal Repayments and Maturities 8,764 14,171 Purchases of Securities ( 25,962 ) ( 10,069 ) Proceeds from Sale of Debt Securities — 1,680 Net Decrease in Loans 4,382 7,466 Purchase of Premises and Equipment ( 202 ) ( 101 ) Investment in Low Income Housing Tax Credit ( 197 ) — Investment in Historical Tax Credit ( 217 ) — Redemption of Restricted Equity Securities — 34 Net Cash (Used in) Provided by Investing Activities ( 13,432 ) 13,181 FINANCING ACTIVITIES Net Increase (Decrease) in Deposits 35,632 ( 2,420 ) Cash Dividends Paid ( 1,411 ) ( 1,281 ) Treasury Stock, Purchases at Cost ( 292 ) ( 2,378 ) Exercise of Stock Options 341 573 Net Cash Provided by (Used in) Financing Activities 34,270 ( 5,506 ) Increase in Cash and Due from Banks 23,856 11,702 CASH AND DUE FROM BANKS AT BEGINNING OF YEAR 31,693 49,572 CASH AND DUE FROM BANKS AT END OF PERIOD $ 55,549 $ 61,274 The accompanying notes are an integral part of these consolidated financial statements 5 Table of Contents CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) Three Months Ended March 31, 2026 2025 (Dollars in Thousands) SUPPLEMENTAL CASH FLOW INFORMATION: Cash Paid For: Interest on Deposits and Borrowings (Including Interest Credited to Deposits of $ 5,478 and $ 6,302 , Respectively) $ 5,881 $ 6,581 Income Taxes 10 1,000 SUPPLEMENTAL NONCASH DISCLOSURE: Transfer of Loans from Loans Held for Sale to Portfolio — 403 Syndicated Loans Purchased and Sold Not Settled, net — 2,985 Right of Use Asset Recognized 495 — Unfunded Commitment in Low Income Housing Tax Credit 3,841 4,995 Unfunded Commitment in Historical Tax Credits 555 — The accompanying notes are an integral part of these consolidated financial statements 6 Table of Contents NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Note 1. Summary Of Significant Accounting Policies Principles of Consolidation and Basis of Presentation The accompanying consolidated financial statements include the accounts of CB Financial Services, Inc. (“CB Financial”) and its wholly owned subsidiary, Community Bank (the “Bank”), and the Bank’s wholly owned subsidiary, Exchange Underwriters, Inc. (“Exchange Underwriters” or "EU"). CB Financial, the Bank and Exchange Underwriters are collectively referred to as the “Company”. Effective September 29, 2025, EU merged with and into the Bank, with the Bank as the surviving institution. All intercompany transactions and balances have been eliminated in consolidation. The accompanying unaudited interim financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and with general practice within the banking industry. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading in any material respect. In preparing financial statements in conformity with GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the Consolidated Statements of Financial Condition and income and expenses for the reporting period. Actual results could differ significantly from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to determination of the allowance for credit losses on loans, goodwill and intangible assets impairment, and the valuation of deferred tax assets. In the opinion of management, the accompanying unaudited interim financial statements include all adjustments considered necessary for a fair presentation of the Company’s financial position and results of operations at the dates and for the periods presented. All these adjustments are of a normal, recurring nature, and they are the only adjustments included in the accompanying unaudited interim consolidated financial statements. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. Interim results are not necessarily indicative of results for a full year. Nature of Operations The Company derives substantially all its income from banking and bank-related services which include interest income on commercial, commercial mortgage, residential real estate and consumer loan financing, as well as interest and dividend income on securities, and fees generated from deposit services to its customers. The Company provides banking services through its subsidiary, Community Bank, a Pennsylvania-chartered commercial bank headquartered in Carmichaels, Pennsylvania. The Bank is a community-oriented institution offering residential and commercial real estate loans, commercial and industrial loans, and consumer loans as well as a variety of deposit products for individuals and businesses in its market area. The Bank operates nine offices in Greene, Allegheny, Washington, Fayette and Westmoreland Counties in southwestern Pennsylvania, and three offices in Marshall and Ohio Counties in West Virginia. 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, 2026 and December 31, 2025, the Company had one reportable segment, community banking services. Critical Accounting Policies; Use of Critical Accounting Estimates The disclosures below supplement the accounting policies disclosed in Note 1 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC. Allowance for Credit Losses (ACL) 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. It also applies to off-balance sheet credit exposures such as loan commitments and unused lines of credit. The ACL is established through a provision for credit losses that is charged against income. The methodology for determining the ACL 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. The expected credit loss for unfunded loan commitments is reported on the Consolidated Statement of Financial Condition in other liabilities while the provision for credit losses related to unfunded commitments is reported in provision for credit losses - unfunded commitments in the Consolidated Statements of Income. 7 Table of Contents ACL on Loans Receivable The ACL on loans is deducted from the amortized cost basis of the loan to present the net amount expected to be collected. Expected losses are evaluated and calculated on a collective, or pooled, basis for those loans which share similar risk characteristics. At each reporting period, the Company evaluates whether loans within a pool continue to exhibit similar risk characteristics. If the risk characteristics of a loan change, such that they are no longer similar to other loans in the pool, the Company will evaluate the loan with a different pool of loans that share similar risk characteristics. If the loan does not share risk characteristics with other loans, the Company will evaluate the loan on an individual basis. The Company evaluates the pooling methodology at least annually. Loans are charged off against the ACL when the Company believes the balances to be uncollectible. Expected recoveries do not exceed the aggregate of amounts previously charged off or expected to be charged off. The Company has chosen to segment its portfolio consistent with the manner in which it manages credit risk. Such segments include residential mortgage, commercial real estate mortgages, construction, commercial business, consumer and other. For most segments, the Company calculates estimated credit losses using a probability of default and loss given default methodology, the results of which are applied to the aggregated discounted cash flow of each individual loan within the segment. The point in time probability of default and loss given default are then conditioned by macroeconomic scenarios to incorporate reasonable and supportable forecasts that affect the collectability of the reported amount. The Company estimates the ACL on loans via a quantitative analysis which considers relevant available information from internal and external sources related to past events and current conditions, as well as the incorporation of reasonable and supportable forecasts. The Company evaluates a variety of factors including third party economic forecasts, industry trends and other available published economic information in arriving at its forecasts. After the reasonable and supportable forecast period, the Company reverts, on a straight-line basis, to average historical losses. Expected credit losses are estimated over the contractual term of the loans, adjusted for expected prepayments when appropriate. The contractual term excludes expected extensions, renewals, and modifications unless either of the following applies: management has a reasonable expectation at the reporting date that a restructuring will be executed with an individual borrower or the renewal option is included in the original or modified contract at the reporting date and are not unconditionally cancellable by the Company. Also included in the ACL on loans are qualitative reserves to cover losses that are expected but, in the Company’s assessment, may not be adequately represented in the quantitative analysis or the forecasts described above. Factors that the Company considers include changes in lending policies and procedures, business conditions, the nature and size of the portfolio, portfolio concentrations, the volume and severity of past due loans and nonaccrual loans, and the effect of external factors such as competition, legal and regulatory requirements, among others. Furthermore, the Company considers the inherent uncertainty in quantitative models that are built upon historical data. Individually Evaluated Loans On a case-by-case basis, the Company may conclude that a loan should be evaluated on an individual basis based on its disparate risk characteristics. When the Company determines that a loan no longer shares similar risk characteristics with other loans in the portfolio, the ACL will be determined on an individual basis using the present value of expected cash flows or, for collateral-dependent loans, the fair value of the collateral as of the reporting date, less estimated selling costs, as applicable. Impaired loans that are collateral dependent are written down to fair value through the establishment of specific reserves. ACL on Off-Balance Sheet Unfunded Commitments The Company is required to include unfunded commitments that are expected to be funded in the future within the ACL calculation, other than those that are unconditionally cancellable. To arrive at that reserve, the reserve percentage for each applicable segment is applied to the unused portion of the expected commitment balance and is multiplied by the expected funding rate. To determine the expected funding rate, the Company uses a historical utilization rate for each segment. As noted above, the ACL on unfunded loan commitments is included in other liabilities on the Consolidated Statement of Financial Condition and the related credit expense is recorded in provision for credit losses - unfunded commitments in the Consolidated Statements of Income. ACL on Available-for-Sale Securities For available-for-sale securities in an unrealized loss position, the Company first assesses whether it intends to sell, or it is more likely than not that it will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For securities available-for-sale that do not meet the above criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, the Company considers the extent to which fair value is less than amortized cost, any changes to the rating by a rating agency, and adverse conditions related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of the cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an ACL is recorded for the credit loss, limited by the amount that the 8 Table of Contents fair value is less than the amortized cost. Any impairment that has not been recorded through an ACL is recognized in other comprehensive income (loss), net of tax. The Company elected the practical expedient of zero loss estimates for securities issued by U.S. government entities and agencies. These securities are either explicitly or implicitly guaranteed by the U.S. government, are highly rated by major agencies and have a long history of no credit losses. Changes in the ACL are recorded as provision for, or reversal of, credit loss expense. Losses are charged against the allowance when management believes the uncollectibility of an available-for-sale security is confirmed or when either of the criteria regarding intent or requirement to sell is met. Accrued Interest Receivable 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 $ 4.43 million at March 31, 2026 and $ 4.41 million at December 31, 2025 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 $ 2.02 million at March 31, 2026 and $ 1.96 million at December 31, 2025 and is excluded from the estimate of credit losses. Recent Accounting Standards 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 is currently evaluating the impact of this update on its disclosures, however does not expect the adoption of this update to have a material effect on its consolidated financial statements. In November 2025, the FASB issued ASU 2025-08, Financial Instruments—Credit Losses (Topic 326):Purchased Loans. The update expands the population of acquired financial assets subject to the gross-up approach in Topic 326 to include acquired seasoned loans without credit deterioration (excluding credit cards). This ASU is effective for annual periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods with early adoption permitted. The amendments in this update are to be applied prospectively to loans that are acquired on or after the initial application date. The Company adopted this update January 1, 2026 and will implement the guidance upon the occurrence of a future acquisition transaction. In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements. The update clarifies hedge accounting guidance and addresses issues arising from the global reference rate reform initiative. There are five issues addressed: 1) expanding risks permitted to be aggregated for cash flow hedges to include those having a similar risk exposure; 2) provide cash flow accounting guidance on choose-your-rate debt instruments; 3) expand hedge accounting for forecasted purchases and sales of nonfinancial assets; 4) update guidance on net written options as hedging instruments; 5) refine foreign-currency-denominated debt instrument as hedging instrument and hedged item (dual hedge). This ASU is effective for annual periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. The amendments in this update are to be applied on a prospective basis. The Company does not expect the adoption of the ASU to have a material effect on its consolidated financial statements. In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. The update provides a comprehensive list of interim disclosures that are required by GAAP to provide clarity about the current requirements. The update also includes a disclosure principle that requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. This ASU is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The amendments in this update can be applied prospectively or retrospectively. The Company does not expect the adoption of the ASU to have a material impact on its consolidated financial statements. 9 Table of Contents In December 2025, the FASB issued ASU 2025-12, Codification Improvements . The amendments in this update represent changes that (1) clarify, (2) correct errors or (3) make minor improvements to the Codification. The amendments are intended to make the Codification easier to understand and apply. The amendments in this update are varied in nature and may affect the application of guidance in cases in which the original guidance may have been unclear. The amendments in this update are effective for all entities for annual reporting beginning after December 15, 2026, and interim reporting for periods within those annual reporting periods. Early adoption is permitted in amendments on an issue-by-issue basis. The Company is currently evaluating the impact of the update on its financial disclosures, however does not expect the adoption of this update to have a material impact on its consolidated financial statements. Note 2. Earnings Pe r Share There are no convertible securities which would affect the numerator in calculating basic and diluted earnings per share; therefore, net income as presented on the Consolidated Statements of Income is used as the numerator. The following table sets forth the composition of the weighted-average common shares (denominator) used in the basic and diluted earnings per share computation: Three Months Ended March 31, 2026 2025 (Dollars in Thousands, except share and per share data) Net Income $ 3,867 $ 1,909 Weighted-Average Basic Common Shares Outstanding 5,053,586 5,125,577 Dilutive Effect of Common Stock Equivalents (Stock Options and Restricted Stock) 265,288 345,429 Weighted-Average Diluted Common Shares and Common Stock Equivalents Outstanding 5,318,874 5,471,006 Earnings Per Share: Basic $ 0.77 $ 0.37 Diluted 0.73 0.35 The dilutive effect on weighted average diluted common shares outstanding is the result of outstanding stock options and nonvested restricted stock. The following table presents for the periods indicated (a) options to purchase shares of common stock that were outstanding but not included in the computation of earnings per share because the options’ exercise price was greater than the average market price of the common shares for the period, and (b) shares of restricted stock awards that were not included in the computation of diluted earnings per share because the hypothetical repurchase of shares under the treasury stock method exceeded the weighted average nonvested restricted awards, therefore the effects would be anti-dilutive. Three Months Ended March 31, 2026 2025 Stock Options — 24,310 Restricted Stock 24,425 25,235 10 Table of Contents Note 3. Securities The following tables present the amortized cost and fair value of securities available-for-sale at the dates indicated: March 31, 2026 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (Dollars in Thousands) Available-for-Sale Debt Securities: U.S. Government Agencies $ 2,000 $ — $ ( 33 ) $ 1,967 Obligations of States and Political Subdivisions 35,202 551 — 35,753 Mortgage-Backed Securities - Government-Sponsored Enterprises 47,633 193 ( 92 ) 47,734 Collateralized Mortgage Obligations - Government-Sponsored Enterprises 86,287 275 ( 6,082 ) 80,480 Collateralized Mortgage Obligations - Non-Agency 10,030 — ( 110 ) 9,920 Collateralized Loan Obligations 96,469 12 ( 291 ) 96,190 Corporate Debt 23,159 216 ( 884 ) 22,491 Total Available-for-Sale Debt Securities $ 300,780 $ 1,247 $ ( 7,492 ) $ 294,535 Equity Securities: Mutual Funds 917 Total Equity Securities 917 Total Securities $ 295,452 December 31, 2025 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (Dollars in Thousands) Available-for-Sale Debt Securities: Obligations of States and Political Subdivisions $ 35,227 $ 997 $ — $ 36,224 Mortgage-Backed Securities - Government-Sponsored Enterprises 40,577 512 — 41,089 Collateralized Mortgage Obligations - Government-Sponsored Enterprises 72,266 576 ( 5,267 ) 67,575 Collateralized Mortgage Obligations - Non-Agency 10,671 1 ( 125 ) 10,547 Collateralized Loan Obligations 101,409 14 ( 205 ) 101,218 Corporate Debt 23,172 137 ( 976 ) 22,333 Total Available-for-Sale Debt Securities $ 283,322 $ 2,237 $ ( 6,573 ) $ 278,986 Equity Securities: Mutual Funds 909 Total Equity Securities 909 Total Securities $ 279,895 11 Table of Contents 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: March 31, 2026 Less than 12 months 12 Months or Greater Total Number of Securities Fair Value Gross Unrealized Losses Number of Securities Fair Value Gross Unrealized Losses Number of Securities Fair Value Gross Unrealized Losses (Dollars in Thousands) U.S. Government Agencies 1 $ 1,967 $ ( 33 ) — $ — $ — 1 $ 1,967 $ ( 33 ) Mortgage Backed Securities- Government-Sponsored Enterprises 4 19,688 ( 92 ) 1 33 — 5 19,721 ( 92 ) Collateralized Mortgage Obligations - Government-Sponsored Enterprises 9 33,971 ( 792 ) 7 18,141 ( 5,290 ) 16 52,112 ( 6,082 ) Collateralized Mortgage Obligations - Non-Agency 4 9,920 ( 110 ) — — — 4 9,920 ( 110 ) Collateralized Loan Obligations 4 20,822 ( 85 ) 8 57,927 ( 206 ) 12 78,749 ( 291 ) Corporate Debt — — — 3 8,588 ( 884 ) 3 8,588 ( 884 ) Total 22 $ 86,368 $ ( 1,112 ) 19 $ 84,689 $ ( 6,380 ) 41 $ 171,057 $ ( 7,492 ) December 31, 2025 Less than 12 months 12 Months or Greater Total Number of Securities Fair Value Gross Unrealized Losses Number of Securities Fair Value Gross Unrealized Losses Number of Securities Fair Value Gross Unrealized Losses (Dollars in Thousands) Mortgage Backed Securities- Government-Sponsored Enterprises — $ — $ — 1 $ 47 $ — 1 $ 47 $ — Collateralized Mortgage Obligations - Government-Sponsored Enterprises 3 13,357 ( 114 ) 7 18,782 ( 5,153 ) 10 32,139 ( 5,267 ) Collateralized Mortgage Obligations - Non-Agency 3 9,206 ( 125 ) — — — 3 9,206 ( 125 ) Collateralized Loan Obligations 10 68,567 ( 194 ) 2 11,174 ( 11 ) 12 79,741 ( 205 ) Corporate Debt 2 3,495 ( 5 ) 3 8,503 ( 971 ) 5 11,998 ( 976 ) Total 18 $ 94,625 $ ( 438 ) 13 $ 38,506 $ ( 6,135 ) 31 $ 133,131 $ ( 6,573 ) 12 Table of Contents For debt securities, the Company does not believe that any individual unrealized loss as of March 31, 2026 or December 31, 2025, 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 March 31, 2026 and December 31, 2025 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 $ 272.0 million at March 31, 2026 and $ 256.7 million at December 31, 2025 of which securities with a fair value of $ 168.9 million and $ 172.6 million at March 31, 2026 and December 31, 2025, 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. Actual maturities will differ from contractual maturities because borrowers may have the right to call or prepay debt obligations with or without prepayment penalties. Mortgage-backed securities, collateralized mortgage obligations and collateralized loan obligations are classified in the table below based on their contractual maturity date; however, regular principal payments and prepayments of principal are received on a monthly basis. March 31, 2026 Amortized Cost Fair Value (Dollars in Thousands) Due in One Year or Less $ 33 $ 33 Due after One Year through Five Years — — Due after Five Years through Ten Years 35,486 34,820 Due after Ten Years 265,261 259,682 Total $ 300,780 $ 294,535 The following table presents the gain and 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 Investment Securities on the Consolidated Statements of Income. Three Months Ended March 31, 2026 2025 (Dollars in thousands) Equity Securities Net Unrealized Gain (Loss) Recognized on Securities Held $ 8 $ ( 56 ) Net Realized Loss Recognized on Securities Sold — ( 13 ) Net Gain (Loss) on Equity Securities $ 8 $ ( 69 ) Net Gain (Loss) on Investment Securities $ 8 $ ( 69 ) Note 4. Loans And Allowance For Credit Losses The Company’s loan portfolio is segmented to enable management to monitor risk and performance. Real estate loans are further segregated into three classes. Residential mortgages include those secured by residential properties and include home equity loans, while commercial mortgages consist of loans to commercial borrowers secured by commercial real estate. Construction loans typically consist of loans to build commercial buildings and acquire and develop residential real estate. The commercial and industrial segment consists of loans to finance the activities of commercial customers. The consumer segment consists primarily of indirect auto loans as well as personal installment loans and personal or overdraft lines of credit. The other segments consists primarily of loans to municipal borrowers that are secured by improved property or other business asset. Residential mortgage loans are typically longer-term loans and, therefore, generally present greater interest rate risk than the consumer and commercial loans. Under certain economic conditions, housing values may decline, which may increase the risk that the collateral values are not sufficient. 13 Table of Contents 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 loans. 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. Construction loans are originated to individuals to finance the construction of residential dwellings and are also originated for the construction of commercial properties, including hotels, apartment buildings, housing developments, and owner-occupied properties used for businesses. Construction loans generally provide for the payment of interest only during the construction phase, which is usually 12 to 18 months. At the end of the construction phase, the loan generally converts to a permanent residential or commercial mortgage loan. Construction loan risks include overfunding in comparison to the plans, untimely completion of work, and leasing and stabilization after project completion. Commercial and industrial loans are generally secured by inventories, accounts receivable, and other business assets, which present collateral risk. Consumer loans generally have higher interest rates and shorter terms than residential mortgage loans; however, they have additional credit risk due to the type of collateral securing the loan. The following table presents the classifications of loans as of the dates indicated: March 31, 2026 December 31, 2025 (Dollars in Thousands) Real Estate: Residential $ 330,761 $ 329,237 Commercial 550,029 552,180 Construction 51,394 45,419 Commercial and Industrial 157,694 161,081 Consumer 36,720 42,876 Other 31,239 31,467 Total Loans 1,157,837 1,162,260 Allowance for Credit Losses ( 10,303 ) ( 10,116 ) Loans, Net $ 1,147,534 $ 1,152,144 Included in total loans above are unamortized net deferred loan fees of $ 718 ,000 and $ 830 ,000 at March 31, 2026 and December 31, 2025, respectively. The Company uses a nine-point internal risk rating system to monitor the credit quality of the overall loan portfolio. The first five categories are not considered criticized and are aggregated as “pass” rated. The criticized rating categories used by management generally follow bank regulatory definitions. The special mention category includes assets that are currently protected but are below average quality, resulting in an undue credit risk, but not to the point of justifying a substandard classification. Loans in the substandard category have well-defined weaknesses that jeopardize the liquidation of the debt and have a distinct possibility that some loss will be sustained if the weaknesses are not corrected. Loans classified as doubtful have all the weaknesses inherent in loans classified as substandard with the added characteristic that collection or liquidation in full, on the basis of current conditions and facts, is highly improbable. Loans classified as loss are considered uncollectible and of such little value that continuance as an asset is not warranted. The following tables present the Company’s loans by year of origination, loan segmentation, risk indicator summarized by the aggregate Pass and the criticized categories of Special Mention and Substandard and gross charge-offs for the three months ended March 31, 2026 and year ended December 31, 2025. The Company did not have any loans classified as Doubtful or Loss as of the dates indicated. 14 Table of Contents Classified Loans by Origination Year (as of March 31, 2026) 2026 2025 2024 2023 2022 Prior Revolving Loans Amortized Cost Basis Total (Dollars in Thousands) Real Estate: Residential Pass $ 15,603 $ 18,479 $ 15,060 $ 28,507 $ 42,478 $ 185,828 $ 19,691 $ 325,646 Special Mention — 356 — — 1,529 1 — 1,886 Substandard — 427 — 2,113 73 616 — 3,229 Total 15,603 19,262 15,060 30,620 44,080 186,445 19,691 330,761 Commercial Pass 13,602 97,337 65,662 52,300 68,475 229,772 3,849 530,997 Special Mention — 621 5,493 — — 12,493 — 18,607 Substandard — 200 — — — 225 — 425 Total 13,602 98,158 71,155 52,300 68,475 242,490 3,849 550,029 Construction Pass 3,623 15,336 9,799 7,362 7,441 7,021 — 50,582 Special Mention — — — — — — — — Substandard — — — 812 — — — 812 Total 3,623 15,336 9,799 8,174 7,441 7,021 — 51,394 Commercial and Industrial Pass 8,759 39,221 21,165 17,681 5,850 12,063 51,010 155,749 Special Mention — — — — — 110 — 110 Substandard — 1,704 131 — — — — 1,835 Total 8,759 40,925 21,296 17,681 5,850 12,173 51,010 157,694 Consumer Pass 209 620 342 4,866 14,338 7,926 8,330 36,631 Special Mention — — — — — — — — Substandard — — — — — 89 — 89 Total 209 620 342 4,866 14,338 8,015 8,330 36,720 Other Pass 62 99 105 3,835 21,670 4,350 1,118 31,239 Special Mention — — — — — — — — Substandard — — — — — — — — Total 62 99 105 3,835 21,670 4,350 1,118 31,239 Total Loans $ 41,858 $ 174,400 $ 117,757 $ 117,476 $ 161,854 $ 460,494 $ 83,998 $ 1,157,837 Real Estate: Residential $ — $ — $ — $ — $ — $ — $ — $ — Commercial — — — — — — — — Construction — — — — — — — — Total Real Estate — — — — — — — — Commercial and Industrial — — — — — — — — Consumer — — 9 22 60 38 18 147 Other — — — — — — — — Total Gross Charge Offs — — 9 22 60 38 18 147 15 Table of Contents Classified Loans by Origination Year (as of December 31, 2025) 2025 2024 2023 2022 2021 Prior Revolving Loans Amortized Cost Basis Total (Dollars in Thousands) Real Estate: Residential Pass $ 18,321 $ 15,378 $ 29,290 $ 43,086 $ 38,637 $ 156,386 $ 23,082 $ 324,180 Special Mention 785 — — 1,541 — — — 2,326 Substandard — — 2,139 — — 592 — 2,731 Total 19,106 15,378 31,429 44,627 38,637 156,978 23,082 329,237 Commercial Pass 98,535 69,669 55,379 69,488 74,487 164,948 2,126 534,632 Special Mention 824 5,513 519 — 7,466 1,169 — 15,491 Substandard — 1,962 — — — 95 — 2,057 Total 99,359 77,144 55,898 69,488 81,953 166,212 2,126 552,180 Construction Pass 11,170 12,220 6,807 7,446 — 7,022 — 44,665 Special Mention — — — — — — — — Substandard — — 754 — — — — 754 Total 11,170 12,220 7,561 7,446 — 7,022 — 45,419 Commercial and Industrial Pass 40,139 22,131 20,315 6,442 2,670 10,182 56,820 158,699 Special Mention 1,780 139 — — — 163 300 2,382 Substandard — — — — — — — — Total 41,919 22,270 20,315 6,442 2,670 10,345 57,120 161,081 Consumer Pass 688 411 5,635 17,322 7,047 3,229 8,437 42,769 Special Mention — — — — — — — — Substandard — — — — 25 82 — 107 Total 688 411 5,635 17,322 7,072 3,311 8,437 42,876 Other Pass 103 120 3,837 21,837 — 4,452 1,118 31,467 Special Mention — — — — — — — — Substandard — — — — — — — — Total 103 120 3,837 21,837 — 4,452 1,118 31,467 Total Loans $ 172,345 $ 127,543 $ 124,675 $ 167,162 $ 130,332 $ 348,320 $ 91,883 $ 1,162,260 Real Estate: Residential $ 25 $ — $ — $ — $ — $ — $ — $ 25 Commercial — — — 19 — — — 19 Construction — — — — — — — — Total Real Estate $ 25 — — 19 — — — 44 Commercial and Industrial 218 — — — — 5 — 223 Consumer — 4 19 95 23 97 64 302 Other — — — — — — — — Total Gross Charge Offs $ 243 $ 4 $ 19 $ 114 $ 23 $ 102 $ 64 $ 569 16 Table of Contents 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: March 31, 2026 Loans Current 30-59 Days Past Due 60-89 Days Past Due 90 Days Or More Past Due Total Past Due Non- Accrual Total Loans (Dollars in Thousands) Real Estate: Residential $ 325,687 $ 2,155 $ 189 $ — $ 2,344 $ 2,730 $ 330,761 Commercial 549,690 244 — — 244 95 550,029 Construction 50,979 — — — — 415 51,394 Commercial and Industrial 157,694 — — — — — 157,694 Consumer 36,300 325 6 — 331 89 36,720 Other 31,239 — — — — — 31,239 Total Loans $ 1,151,589 $ 2,724 $ 195 $ — $ 2,919 $ 3,329 $ 1,157,837 December 31, 2025 Loans Current 30-59 Days Past Due 60-89 Days Past Due 90 Days Or More Past Due Total Past Due Non- Accrual Total Loans (Dollars in Thousands) Real Estate: Residential $ 322,628 $ 3,434 $ 444 $ — $ 3,878 $ 2,731 $ 329,237 Commercial 549,990 — 133 — 133 2,057 552,180 Construction 45,004 — — — — 415 45,419 Commercial and Industrial 161,081 — — — — — 161,081 Consumer 42,142 539 88 — 627 107 42,876 Other 31,467 — — — — — 31,467 Total Loans $ 1,152,312 $ 3,973 $ 665 $ — $ 4,638 $ 5,310 $ 1,162,260 Additional interest income that would have been recorded if the loans that were nonaccrual at March 31, 2026 were current was $ 27,000 for the three months ended March 31, 2026, and $ 52,000 for the three months ended March 31, 2025. 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, 2026 Nonaccrual With No ACL Nonaccrual With ACL Loans Past Due 90 Days Still Accruing Total Nonperforming Assets (Dollars in Thousands) Nonaccrual Loans: Real Estate: Residential $ 1,613 $ 1,117 $ — $ 2,730 Commercial 95 — — 95 Construction — 415 — 415 Consumer 89 — — 89 Total Nonaccrual Loans $ 1,797 $ 1,532 $ — 3,329 Other Real Estate Owned — Total Nonperforming Assets $ 3,329 17 Table of Contents December 31, 2025 Nonaccrual With No ACL Nonaccrual With ACL Loans Past Due 90 Days Still Accruing Total Nonperforming Assets (Dollars in Thousands) Nonaccrual Loans: Real Estate: Residential $ 2,210 $ 521 $ — $ 2,731 Commercial 2,057 — — 2,057 Construction 131 284 — 415 Consumer 107 — — 107 Total Nonaccrual Loans $ 4,505 $ 805 $ — 5,310 Other Real Estate Owned — Total Nonperforming Assets $ 5,310 No interest income on nonaccrual loans was recognized during the three months ended March 31, 2026 and March 31, 2025. All modifications and refinancing, including those with borrowers that are experiencing financial difficulty are subject to the modification guidance in ASC 310-20. Loan modifications could meet the definition of a new loan if certain terms of the loan are modified to the benefit of the lender and the modification to the terms of the loan are more than minor. Both of these criteria have to be met to define the modification as a new loan. If a loan modification meets the criteria of new loan, then the new loan should include the remaining net investment in the original loan, additional funds advanced, fees received, and direct loan origination costs with the refinancing or restructuring. 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 months ended March 31, 2026 and March 31, 2025, 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 $ 662 ,000 and $ 892 ,000 at March 31, 2026 and December 31, 2025, respectively. The activity in the ACL - Loans is summarized below by primary segments for the periods indicated: Real Estate Residential Real Estate Commercial Real Estate Construction Commercial and Industrial Consumer Other Total (Dollars in Thousands) December 31, 2025 $ 2,526 $ 3,153 $ 1,205 $ 2,562 $ 450 $ 220 $ 10,116 Charge-offs — — — — ( 147 ) — ( 147 ) Recoveries — — — 36 70 — 106 (Recovery) Provision for Credit Losses - Loans ( 24 ) 80 112 9 49 2 228 March 31, 2026 $ 2,502 $ 3,233 $ 1,317 $ 2,607 $ 422 $ 222 $ 10,303 18 Table of Contents Real Estate Residential Real Estate Commercial Real Estate Construction Commercial and Industrial Consumer Other Total (Dollars in Thousands) December 31, 2024 $ 2,926 $ 3,103 $ 1,264 $ 1,584 $ 687 $ 241 $ 9,805 Charge-offs — — — — ( 135 ) — ( 135 ) Recoveries 1 — — 43 37 — 81 (Recovery) Provision for Credit Losses - Loans ( 31 ) 25 ( 37 ) 121 ( 3 ) ( 7 ) 68 March 31, 2025 $ 2,896 $ 3,128 $ 1,227 $ 1,748 $ 586 $ 234 $ 9,819 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. As of March 31, 2026, there were $ 1.9 million of loans that required specific valuation allowances of $ 331 ,000. This included residential real estate loans for $ 1.1 million with a valuation allowance of $ 94 ,000, a construction loan for $ 414 ,000 with a valuation allowance of $ 154 ,000, and commercial and industrial loans for $ 323 ,000 with a valuation allowance of $ 83 ,000. As of December 31, 2025, there were $ 970,000 of loans that required specific valuation allowances of $ 165,000 . This included residential real estate loans for $ 556,000 with a valuation allowance of $ 35,000 , and a construction real estate loan for $ 414,000 with a valuation allowance of $ 130,000 . The following tables present the amortized cost basis of collateral-dependent loans by class of loans as of the dates indicated. March 31, 2026 Primary Type of Collateral Real Estate Business Assets Total (Dollars in thousands) Real Estate: Residential $ 2,801 $ — $ 2,801 Commercial 469 200 669 Construction 812 — 812 Commercial and Industrial — 623 623 Consumer — — — Other — — — Total Loans $ 4,082 $ 823 $ 4,905 December 31, 2025 Primary Type of Collateral Real Estate (Dollars in thousands) Real Estate: Residential $ 2,326 Commercial 2,306 Construction 754 Commercial and Industrial — Consumer — Other — Total Loans $ 5,386 The Company’s ACL 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 - 19 Table of Contents unfunded commitments on the Consolidated Statement of Income. The Company’s activity in the ACL on unfunded commitments for the periods indicated was as follows: Allowance for Credit Losses (Dollars in Thousands) Balance at December 31, 2025 $ 746 Provision for Credit Losses - Unfunded Commitments 13 Balance at March 31, 2026 $ 759 Allowance for Credit Losses (Dollars in Thousands) Balance at December 31, 2024 $ 691 Recovery for Credit Losses - Unfunded Commitments ( 108 ) Balance at March 31, 2025 $ 583 Note 5. Derivatives And Hedging Activities Derivatives Not Designated as Hedging Instruments Interest Rate Swaps . The Company enters into interest rate swap agreements to meet the financing and interest rate management needs of qualifying commercial loan customers. The Company simultaneously enters into interest rate swaps with dealer counterparties, with identical notional amounts and terms. The net result of the offsetting customer and dealer counterparty swap agreements is that the customer pays a fixed rate of interest and the Company receives a floating rate. The credit risk associated with derivatives executed with customers is essentially the same as that involved in extending loans and is subject to normal credit policies and monitoring. Swap derivative transactions with customers are not subject to enforceable master netting arrangements and are generally secured by rights to non-financial collateral, such as real and personal property. Risk Participation Agreements . The Company has five risk participation agreements with financial institution counterparties for interest rate swaps related to loans in which it is a participant. The risk participation agreements provide credit protection to the financial institution should the borrower fail to perform on its interest rate derivative contract with the financial institution. Derivatives Designated as Hedging Instruments In October 2023, the Company entered into an interest rate swap contract that is designated as a fair value hedge to mitigate the risk of interest rate increases and the subsequent impact on the associated fixed rate mortgages. This contract matures on October 17, 2026, has a notional amount of $ 75.0 million and is benchmarked to SOFR. The Company expects the hedge to remain effective during the remaining term of the swap. The following table depicts the credit value and fair value adjustments recorded related to the notional amount of derivatives outstanding and interest rate swaps and risk participation agreements with other financial institutions. These adjustments are included in Accrued Interest Payable and Other Liabilities and Accrued Interest Receivable and Other Assets on the Company's Consolidated Statement of Financial Condition. March 31, 2026 Derivative Assets Derivative Liabilities Notional Amount Fair Value Notional Amount Fair Value (Dollars in Thousands) Derivatives Designated as Hedging Instruments Interest Rate Swap Contracts $ — $ — $ 75,000 $ 401 Total Derivatives Designated as Hedging Instruments — — 75,000 401 Derivatives Not Designated as Hedging Instruments Interest Rate Swap Contracts - Commercial Loans 10,938 37 10,938 37 Risk Participation Agreements — — 30,576 60 Total Derivatives Not Designated as Hedging Instruments 10,938 37 41,514 97 Total Derivatives $ 10,938 $ 37 $ 116,514 $ 498 20 Table of Contents December 31, 2025 Derivative Assets Derivative Liabilities Notional Amount Fair Value Notional Amount Fair Value (Dollars in Thousands) Derivatives Designated as Hedging Instruments Interest Rate Swap Contracts $ — $ — $ 75,000 $ 704 Total Derivatives Designated as Hedging Instruments — — 75,000 704 Derivatives Not Designated as Hedging Instruments Interest Rate Swap Contracts - Commercial Loans 10,920 103 10,920 103 Risk Participation Agreements — — 30,672 66 Total Derivatives Not Designated as Hedging Instruments 10,920 103 41,591 169 Total Derivatives $ 10,920 $ 103 $ 116,591 $ 873 Note 6. Fair Value Disclosure ASC Topic 820 “Fair Value Measurement” defines fair value and provides the framework for measuring fair value and required disclosures about fair value measurements. Fair value is defined as the price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants in the principal or most advantageous market for the asset or liability at the transaction date. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used in valuation methods to determine fair value. The three levels of fair value hierarchy are as follows: Level 1 – Fair value is based on unadjusted quoted prices in active markets that are accessible to the Company for identical assets. These generally provide the most reliable evidence and are used to measure fair value whenever available. Level 2 – Fair value is based on significant inputs, other than Level 1 inputs, that are observable either directly or indirectly for substantially the full term of the asset through corroboration with observable market data. Level 2 inputs include quoted market prices in active markets for similar assets, quoted market prices in markets that are not active for identical or similar assets, and other observable inputs. Level 3 – Fair value is based on significant unobservable inputs. Examples of valuation methodologies that would result in Level 3 classification include option pricing models, discounted cash flows, and other similar techniques. This hierarchy requires the use of observable market data when available. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement. The majority of the Company’s securities are included in Level 2 of the fair value hierarchy. Fair values for Level 2 securities were primarily determined by a third-party pricing service using both quoted prices for similar assets, when available, and model-based valuation techniques that derive fair value based on market-corroborated data, such as instruments with similar prepayment speeds and default interest rates. The standard inputs that are normally used include benchmark yields of like securities, reportable trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, and reference data including market research publications. The Company uses derivative instruments, including interest rate swaps and risk participation agreements, and the fair value of such instruments are calculated using accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative, considering the contractual terms of each derivative, and uses observable market-based inputs, such as interest rate curves and implied volatilities. Credit valuation adjustments are incorporated to appropriately reflect nonperformance risk and the respective counterparties' nonperformance risk in calculating fair value measurements. These instruments are classified as Level 2. There were no transfers into or out of Level 3 during the three months ended March 31, 2026 or year ended December 31, 2025. 21 Table of Contents 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: Fair Value Hierarchy March 31, 2026 December 31, 2025 (Dollars in Thousands) ASSETS Available-for-Sale Debt Securities U.S. Government Agencies Level 2 $ 1,967 $ — Obligations of States and Political Subdivisions Level 2 35,753 36,224 Mortgage-Backed Securities - Government-Sponsored Enterprises Level 2 47,734 41,089 Collateralized Mortgage Obligations - Government Sponsored Enterprises Level 2 80,480 67,575 Collateralized Mortgage Obligations - Non-Agency Level 2 9,920 10,547 Collateralized Loan Obligations Level 2 96,190 101,218 Corporate Debt Level 2 22,491 22,333 Total Available-for-Sale Debt Securities 294,535 278,986 Equity Securities Mutual Funds Level 1 917 909 Total Equity Securities 917 909 Total Securities 295,452 279,895 Derivative Financial Assets Interest Rate Swaps - Commercial Loans Level 2 $ 37 $ 103 Total Assets $ 295,489 $ 279,998 LIABILITIES Derivative Financial Liabilities Interest Rate Swaps Level 2 $ 401 $ 704 Interest Rate Swaps - Commercial Loans Level 2 37 103 Risk Participation Agreements Level 2 60 66 Total Liabilities $ 498 $ 873 The following table presents the financial assets on the Consolidated Statements of Financial Condition measured at fair value on a nonrecurring basis as of the dates indicated by level within the fair value hierarchy for only those nonrecurring assets that had a fair value below the carrying amount. The table also presents the significant unobservable inputs used in the fair value measurements. Financial Asset Fair Value Hierarchy March 31, 2026 Valuation Techniques Significant Unobservable Inputs Range Weighted Average (Dollars in Thousands) Collateral-Dependent Loans Individually Assessed Level 3 $ 1,523 Appraisal of Collateral (1) Appraisal Adjustments (2) 31 % to 86 % 59.9 % Financial Asset Fair Value Hierarchy December 31, 2025 Valuation Techniques Significant Unobservable Inputs Range Weighted Average (Dollars in Thousands) Collateral-Dependent Loans Individually Assessed Level 3 $ 805 Appraisal of Collateral (1) Appraisal Adjustments (2) 31 % to 85 % 69.9 % (1) Fair value is generally determined through independent appraisals of the underlying collateral, which may include various Level 3 inputs, which are not identifiable. (2) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range and weighted average of appraisal adjustments and liquidation expense are presented as a percent of the appraisal. 22 Table of Contents Collateral-dependent loans are evaluated and valued at the time the loan is identified as collateral-dependent, 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 March 31, 2026, the fair value of these loans consisted of loan balances of $ 1.9 million less specific valuation allowances of $ 331 ,000. At December 31, 2025, the fair value of these loans consisted of loan balances of $ 1.0 million less specific valuation allowances of $ 165 ,000. 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. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. If no readily available market exists, the fair value estimates for financial instruments should be based upon management’s judgment regarding current economic conditions, interest rate risk, expected cash flows, future estimated losses and other factors, as determined through various option pricing formulas or simulation modeling. As many of these assumptions result from judgments made by management based upon estimates which are inherently uncertain, the resulting estimated fair values may not be indicative of the amount realizable in the sale of a particular financial instrument. In addition, changes in the assumptions on which the estimated fair values are based may have significant impact on the resulting estimated fair values. As certain assets such as deferred tax assets and premises and equipment are not considered financial instruments, the estimated fair value of financial instruments would not represent the full value of the Company. The following table presents the estimated fair values of the Company’s financial instruments at the dates indicated. March 31, 2026 December 31, 2025 Fair Value Hierarchy Carrying Value Fair Value Carrying Value Fair Value (Dollars in Thousands) Financial Assets: Cash and Due From Banks: Interest-Earning Level 1 $ 42,849 $ 42,849 $ 18,374 $ 18,374 Noninterest-Earning Level 1 12,700 12,700 13,319 13,319 Securities See Above 295,452 295,452 279,895 279,895 Loans, Net Level 3 1,147,534 1,113,261 1,152,144 1,119,213 Restricted Stock Level 2 3,587 3,587 2,985 2,985 Mortgage Servicing Rights Level 3 403 696 415 700 Derivative Assets Level 2 37 37 103 103 Accrued Interest Receivable Level 2 6,451 6,451 6,374 6,374 Financial Liabilities: Deposits Level 2 1,375,437 1,374,804 1,339,805 1,339,286 Other Borrowed Funds FHLB Borrowings Level 2 20,000 20,035 20,000 20,109 Subordinated Debt Level 2 14,768 14,322 14,758 14,452 Derivative Liabilities Level 2 498 498 873 873 Accrued Interest Payable Level 2 1,920 1,920 2,021 2,021 Note 7. Commitments And Contingent Liabilities The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business primarily to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby and performance letters of credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the Consolidated Statements of Financial Condition. The contract amounts of those instruments reflect the extent of involvement the Company has in particular classes of financial instruments. The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and standby and performance letters of credit written is represented by the contractual amount of 23 Table of Contents those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments. The Company maintains an ACL on unfunded commitments to provide for the risk of loss inherent in these arrangements. The Company is required to include unfunded commitments that are expected to be funded in the future within the allowance calculation, other than those that are unconditionally cancellable. To arrive at that reserve, the reserve percentage for each applicable segment is applied to the unused portion of the expected commitment balance and is multiplied by the expected funding rate. To determine the expected funding rate, the Company uses a historical utilization rate for each segment. The ACL on unfunded loan commitments is included in other liabilities on the Consolidated Statement of Financial Condition and the related expense is recorded in provision for credit losses - unfunded commitments in the Consolidated Statement of Income. The following table presents the unused and available credit balances of financial instruments whose contracts represent credit risk at the dates indicated: March 31, 2026 December 31, 2025 (Dollars in Thousands) Standby Letters of Credit $ 218 $ 630 Performance Letters of Credit 1,973 1,974 Construction Loans 41,709 43,294 Personal Lines of Credit 9,096 9,659 Overdraft Protection Lines 4,006 4,067 Home Equity Lines of Credit 35,408 32,112 Commercial Lines of Credit 99,139 104,654 Total Commitments $ 191,549 $ 196,390 Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee by the customer. Because many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management’s credit evaluation of the counterparty. Collateral held varies, but may include accounts receivable, inventory, property, plant and equipment, and income-producing commercial properties. Performance letters of credit represent conditional commitments issued by the Company to guarantee the performance of a customer to a third party. These instruments are issued primarily to support bid or performance-related contracts. The coverage period for these instruments is typically a one-year period with an annual renewal option subject to prior approval by management. Fees earned from the issuance of these letters are recognized upon expiration of the letter. 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 March 31, 2026 and December 31, 2025. Note 8. Leases The Company evaluates all contracts at commencement to determine if a lease is present. In accordance with ASC Topic 842, leases are defined as either operating or finance leases. The Company’s lease contracts are all classified as operating leases and create operating right-of-use (“ROU”) assets and corresponding lease liabilities on the Consolidated Statements of Financial Condition. The leases are primarily ROU assets of land and building for branch and loan production locations. ROU assets are reported in Accrued Interest Receivable and Other Assets and the related lease liabilities in Accrued Interest Payable and Other Liabilities on the Consolidated Statements of Financial Condition. 24 Table of Contents The following tables present the lease expense, ROU assets, weighted average term, discount rate and maturity analysis of lease liabilities for operating leases for the periods and dates indicated. Three Months Ended March 31, 2026 2025 (Dollars in Thousands) Operating Lease Expense $ 147 $ 117 Variable Lease Expense 12 12 Total Lease Expense $ 159 $ 129 March 31, 2026 December 31, 2025 (Dollars in Thousands) Operating Leases: ROU Assets $ 2,904 $ 2,529 Weighted Average Lease Term in Years 9.21 10.42 Weighted Average Discount Rate 4.18 % 4.25 % March 31, 2026 (Dollars in Thousands) Maturity Analysis: Due in One Year $ 623 Due After One Year to Two Years 574 Due After Two Years to Three Years 531 Due After Three Years to Four Years 265 Due After Four to Five Years 266 Due After Five Years 1,475 Total $ 3,734 Less: Present Value Discount 748 Lease Liabilities $ 2,986 During the three months ended March 31, 2026, the Bank entered into a lease agreement under which the Bank leased office space located in Canonsburg, Pennsylvania. The lease agreement is for an initial term of three years with specific 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 $ 495,000 . Note 9. Segment And Related Information 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, 2026 and December 31, 2025, 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. 25 Table of Contents Note 10. Stock Based Compensation The following table presents stock option information for the period and at the dates indicated: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life in Years Outstanding Options at December 31, 2025 223,794 $ 24.13 6.1 Granted — — Exercised ( 13,802 ) 24.69 Forfeited — — Outstanding Options at March 31, 2026 209,992 $ 24.10 5.8 Exercisable Options at March 31, 2026 130,633 $ 24.98 5.0 Number of Shares Weighted Average Exercise Price Weighted Average Remaining Service Period in Years Nonvested Options at March 31, 2026 79,359 $ 22.65 7.3 The following table presents restricted stock award information for the period indicated: Number of Shares Weighted Average Grant Date Fair Value Price Weighted Average Remaining Service Period in Years Nonvested Restricted Stock at December 31, 2025 65,866 $ 25.83 3.1 Granted 30,425 36.83 Vested ( 16,570 ) 25.56 Forfeited — — Nonvested Restricted Stock at March 31, 2026 79,721 $ 30.08 3.4 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 $ 212,000 and $ 223,000 for the three months ended March 31, 2026 and 2025. As of March 31, 2026 and December 31, 2025, total unrecognized compensation expense was $ 350,000 and $ 397 ,000, respectively, related to stock options, and $ 2.3 million and $ 1.3 million, respectively, related to restricted stock awards. Intrinsic value represents the amount by which the fair value of the underlying stock at March 31, 2026 and December 31, 2025 exceeds the exercise price of the stock options. The intrinsic value of stock options was $ 2.1 million and $ 2.4 million at March 31, 2026 and December 31, 2025, respectively. At March 31, 2026 and December 31, 2025, there were 231,840 and 262,265 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, 2026, 55,660 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. Note 11. Variable Interest Entities The Company has investment interests in the following non-consolidated entities that meets the definition of variable interest entities ("VIEs"). The Company's funding requirements are limited to its invested capital and any additional unfunded commitments for future equity contributions. The Company's maximum exposure to loss as a result of its involvement is limited to the carrying amounts of the investments, including the unfunded commitments. The investments in these partnerships are included in Accrued Interest 26 Table of Contents Receivable and Other Assets and unfunded commitments are included in Accrued Interest Payable and Other Liabilities on the Consolidated Statements of Financial Condition. The Company currently expects to fund these commitments by the end of 2035. The Company accounts for qualifying investments under the proportional amortization method. 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. Low Income Housing Tax Credit Investments The Company makes equity investments in an entity that sponsors affordable housing and other community development projects that qualify for the Low Income Housing Tax Credit ("LIHTC") program pursuant to Section 42 of the Internal Revenue Code. The purpose of this investment is not only to assist the Bank in meeting its responsibilities under the Community Reinvestment Act, but also to provide an investment return, primarily through the realization of tax benefits. The LIHTC partnership is managed by unrelated general partners that have the power to direct the activities which most significantly affect the performance of the partnership. The Company is therefore not the primary beneficiary of the LIHTC partnership and accordingly, does not consolidate this VIE. The following table presents the balances of the Company's LIHTC investments and related unfunded commitments: March 31, 2026 December 31, 2025 (Dollars in thousands) Low Income Housing Tax Credit Investments $ 6,000 $ 6,000 Less: Amortization ( 271 ) ( 190 ) Net Low Income Housing Tax Credit Investments $ 5,729 $ 5,810 Unfunded Commitments $ 3,841 $ 4,038 Historical Tax Credit Investments The Company makes equity investments in an entity that sponsors rehabilitation projects that qualify for the Historical Tax Credit ("HTC") program pursuant to Section 47 of the Internal Revenue Code. The purpose of this investment is to provide an investment return, primarily through the realization of tax benefits. The HTC partnership is managed by unrelated general partners that have the power to direct the activities which most significantly affect the performance of the partnership. The Company is therefore not the primary beneficiary of the HTC partnership and accordingly, does not consolidate this VIE. The following table presents the balances of the Company's HTC investments and related unfunded commitments: March 31, 2026 December 31, 2025 (Dollars in thousands) Historical Tax Credit Investments $ 772 $ — Less: Amortization — — Net Historical Tax Credit Investments $ 772 $ — Unfunded Commitments $ 555 $ — The following table presents other information related to the Company's tax credit investments: Three Months Ended March 31, 2026 2025 (dollars in thousands) Tax Credits and Other Tax Benefits Recognized: LIHTC $ 91 $ 50 HTC $ — $ — Proportional Amortization Expense Included in Provision for Income Taxes: LIHTC $ 80 $ 39 HTC $ — $ — 27 Table of Contents Note 12. Subsequent Events The Company evaluated subsequent events through the date the consolidated financial statements were filed with the SEC and incorporated into the consolidated financial statements the effect of all material known events determined by Accounting Standards Codification ("ASC") 855, Subsequent Events , to be recognizable events. 28 Table of Contents