What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-08-06 compared with 2026-05-06 · 246 added, 193 removed, 1296 unchanged (25% of the section changed)

2 unchanged sentences

Consolidated Balance Sheets

March 31, 2026 (unaudited) and December 31, 2025

June 30, 2026 (unaudited) and December 31, 2025

(derived from audited financial statements)

(in thousands, except share data)

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Cash and cash equivalents $ 121,762 $ 118,853

Available for sale ("AFS") securities, at fair value (amortized cost of $ 148,067 , net of allowance for credit losses of $ 0 at March 31, 2026 and amortized cost of $ 151,618 , net of allowance for credit losses of $ 0 at December 31, 2025)

Available-for-sale ("AFS") securities, at fair value (amortized cost of $ 145,282 , net of allowance for credit losses of $ 0 at June 30, 2026 and amortized cost of $ 151,618 , net of allowance for credit losses of $ 0 at December 31, 2025)

128,435 134,103

Held to maturity ("HTM") securities, at amortized cost (fair value of $ 63,020 , net of allowance for credit losses of $ 0 at March 31, 2026 and fair value of $ 64,117 , net of allowance for credit losses of $ 0 at December 31, 2025)

Held-to-maturity ("HTM") securities, at amortized cost (fair value of $ 61,481 , net of allowance for credit losses of $ 0 at June 30, 2026 and fair value of $ 64,117 , net of allowance for credit losses of $ 0 at December 31, 2025)

77,415 80,210

31 unchanged sentences

Consolidated Statements of Operations (unaudited)

Three Months Ended March 31, 2026 and 2025

Three and Six Months Ended June 30, 2026 and 2025

(in thousands, except per share data)

Three Months Ended

March 31, 2026 March 31, 2025

Three Months Ended Six Months Ended

June 30, 2026 June 30, 2025 June 30, 2026 June 30, 2025

Interest and dividend income:

8 unchanged sentences

Net interest income before provision for credit losses 13,504 13,311 26,514 24,905

Provision (provision reversal) for credit losses 750 ( 250 )

Provision for credit losses 4,325 1,350 5,075 1,100

Net interest income after provision for credit losses 9,179 11,961 21,439 23,805

5 unchanged sentences

Loan fees and service charges 129 237 267 357

Net (losses) gains on equity securities ( 59 ) 10

Net gains on equity securities 160 99 101 109

Other 267 240 644 483

9 unchanged sentences

Professional services 514 432 1,119 940

Losses on repossessed assets, net — 4

(Gains) losses on repossessed assets, net ( 12 ) — ( 12 ) 4

Other 1,100 649 1,730 1,313

10 unchanged sentences

Consolidated Statements of Comprehensive Income (unaudited)

Three months ended March 31, 2026 and 2025

Three and Six months ended June 30, 2026 and 2025

(in thousands)

Three Months Ended

March 31, 2026 March 31, 2025

Three Months Ended Six Months Ended

June 30, 2026 June 30, 2025 June 30, 2026 June 30, 2025

Net income attributable to common stockholders $ 1,102 $ 3,270 $ 4,857 $ 6,467

7 unchanged sentences

Consolidated Statement of Changes in Stockholders’ Equity (unaudited)

Three Months Ended March 31, 2026

Six Months Ended June 30, 2026

(in thousands, except shares and per share data)

11 unchanged sentences

Balance at March 31, 2026 9,628,612 96 110,277 92,739 ( 12,238 ) 190,874

Net income — — — 1,102 — 1,102

Other comprehensive income, net of tax — — — — 215 215

Common stock awarded under the equity incentive plan 6,500 — — — — —

Common stock options exercised 16,000 1 179 — — 180

Common stock repurchased ( 881 ) — ( 10 ) ( 8 ) — ( 18 )

Stock based compensation expense — — 8 — — 8

Cash dividends ($ 0.105 per share)

— — — ( 1,013 ) — ( 1,013 )

Balance at June 30, 2026 9,650,231 $ 97 $ 110,454 $ 92,820 $ ( 12,023 ) $ 191,348

See accompanying condensed notes to unaudited consolidated financial statements.

7 unchanged sentences

Net income — — — 3,197 — 3,197

Other comprehensive loss, net of tax — — — — 1,455 1,455

Other comprehensive income, net of tax — — — — 1,455 1,455

Surrender of restricted shares of common stock to satisfy the withholding taxes due upon vesting ( 11,481 ) — ( 183 ) — — ( 183 )

17 unchanged sentences

Net income — — — 4,271 — 4,271

Other comprehensive loss, net of tax — — — — 760 760

Other comprehensive income, net of tax — — — — 760 760

Common stock options exercised 10,500 — 118 — — 118

5 unchanged sentences

Consolidated Statements of Cash Flows (unaudited)

Three Months Ended March 31, 2026 and 2025

Six Months Ended June 30, 2026 and 2025

(in thousands)

Three Months Ended

March 31, 2026 March 31, 2025

Six Months Ended

June 30, 2026 June 30, 2025

Cash flows from operating activities:

3 unchanged sentences

Depreciation expense 961 1,044

Provision (provision reversal) for credit losses 750 ( 250 )

Net losses (gains) on equity securities 59 ( 10 )

Provision for credit losses 5,075 1,100

Net gains on equity securities ( 101 ) ( 109 )

Increase in mortgage servicing rights resulting from transfers of financial assets ( 293 ) ( 173 )

2 unchanged sentences

Stock based compensation expense 12 102

Decrease (increase) in deferred income taxes 118 ( 18 )

Increase in deferred income taxes ( 562 ) ( 152 )

Increase in cash surrender value of life insurance ( 434 ) ( 392 )

Net loss from disposals of foreclosed and repossessed assets — 19

Net gain from disposals of foreclosed and repossessed assets ( 12 ) ( 11 )

Provision for valuation allowance on foreclosed properties — 15

23 unchanged sentences

Net increase in deposits 30,318 ( 9,732 )

Repurchase shares of common stock ( 18 ) —

Surrender of restricted shares of common stock ( 89 ) ( 190 )

5 unchanged sentences

Cash and cash equivalents at end of period $ 121,762 $ 67,454

Six Months Ended

June 30, 2026 June 30, 2025

Supplemental cash flow information:

9 unchanged sentences

NOTE 1 – NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The consolidated financial statements of Citizens Community Federal N.A.

The consolidated financial statements of CCFBank N.A.

(the “Bank”) included herein have been included by its parent company, Citizens Community Bancorp, Inc.

1 unchanged sentence

As used in this quarterly report, the terms “we”, “us”, “our”, and “Citizens Community Bancorp, Inc.” mean the Company and its wholly owned subsidiary, the Bank, unless the context indicates other meaning.

The Bank is a national banking association (a “National Bank”) and operates under the title of Citizens Community Federal National Association (“Citizens Community Federal N.A.” or “Bank”).

The Bank is a national banking association (a “National Bank”) and operates under the title of CCFBank National Association (“CCFBank N.A.” or “Bank”).

The Company is a bank holding company, supervised by the Federal Reserve Bank of Minneapolis (the “FRB”), and operates under the title of Citizens Community Bancorp, Inc.

5 unchanged sentences

Additionally, the Bank is subject to the regulations of certain regulatory agencies and undergoes periodic examination by those regulatory agencies.

In preparing these consolidated financial statements, we evaluated the events and transactions that occurred subsequent to the balance sheet date of March 31, 2026, through the date on which the consolidated financial statements were available to be issued on May 6, 2026, for items that should potentially be recognized or disclosed in these consolidated financial statements.

In preparing these consolidated financial statements, we evaluated the events and transactions that occurred subsequent to the balance sheet date of June 30, 2026, through the date on which the consolidated financial statements were available to be issued on August 6, 2026, for items that should potentially be recognized or disclosed in these consolidated financial statements.

The accompanying consolidated interim financial statements are unaudited.

9 unchanged sentences

Factors that may cause sensitivity to the aforementioned estimates include but are not limited to:

those items described under the caption “Risk Factors” in Item 1A of the annual report on Form 10-K for the year ended December 31, 2025, filed with the SEC on March 5, 2026;

those items described under the caption “Risk Factors” in Item 1A of the annual report on Form 10-K for the year ended December 31, 2025, filed with the SEC on March 5, 2026 and Item 1A in Part II of this report;

the matters described in Forward-Looking Statements in Part 1, Item 2 of this Form 10-Q;

5 unchanged sentences

Available-for-sale and Held-to-maturity – Management determines the appropriate classification of investment securities at the time of purchase and reevaluates such designation as of the date of each balance sheet.

are classified as held to maturity when the Company has the positive intent and ability to hold the securities to maturity.

Securities are classified as held-to-maturity when the Company has the positive intent and ability to hold the securities to maturity.

Held-to-maturity securities are stated at amortized cost.

19 unchanged sentences

The Company has elected to not measure an ACL on accrued interest on available-for-sale and held-to-maturity securities, as it would write off accrued interest in a timely manner if the related security was determined to have a credit loss.

Accrued interest receivable on available-for-sale and held-to-maturity securities was $ 762 and $ 924 at March 31, 2026 and December 31, 2025, respectively.

The Company has no available-for-sale securities or held-to-maturity securities which it deems to have a credit loss at March 31, 2026 and December 31, 2025.

Accrued interest receivable on available-for-sale and held-to-maturity securities was $ 862 and $ 924 at June 30, 2026 and December 31, 2025, respectively.

The Company has no available-for-sale securities or held-to-maturity securities which it deems to have a credit loss at June 30, 2026 and December 31, 2025.

Equity investments - The Company is required to maintain an investment in Federal Agricultural Mortgage Corporation (“Farmer Mac”) equity securities.

4 unchanged sentences

We record the unrealized gains and losses resulting from changes in the fair value of this investment as net gains or losses on investment securities in our consolidated statements of operations.

Also included in equity investments are the Company’s investments in a Volker Rule-compliant Small Business Investment Company ("SBIC") and an investment fund.

Also included in equity investments are the Company’s investments in a Volcker Rule-compliant Small Business Investment Company ("SBIC") and an investment fund.

The SBIC and investment fund meet the definition of investment companies, as defined in ASC 946, Financial Services - Investment Companies.

14 unchanged sentences

Based on management’s quarterly evaluation, no impairment has been recorded on these securities.

Other investments totaling $ 12,498 at March 31, 2026, consisted of $ 3,708 of FHLB stock, $ 5,726 of Federal Reserve Bank stock and $ 3,064 of Bankers’ Bank stock.

Other investments totaling $ 12,485 at June 30, 2026, consisted of $ 3,696 of FHLB stock, $ 5,726 of Federal Reserve Bank stock and $ 3,063 of Bankers’ Bank stock.

Other investments totaling $ 12,506 at December 31, 2025, consisted of $ 3,717 of FHLB stock and $ 5,726 of Federal Reserve Bank stock and $ 3,063 of Bankers’ Bank stock.

55 unchanged sentences

The Company has elected to not measure an ACL on accrued interest as it writes off accrued interest in a timely manner.

Accrued interest receivable on loans was $ 4,523 and $ 4,841 at March 31, 2026 and December 31, 2025, respectively.

Accrued interest receivable on loans was $ 4,943 and $ 4,841 at June 30, 2026 and December 31, 2025, respectively.

Allowance for Credit Losses - Unfunded Commitments - The ACL on unfunded commitments is a liability for credit losses on commitments to originate or fund loans, and standby letters of credit.

14 unchanged sentences

MSR assets are initially measured at fair value;

assessed for impairment at least annually;

assessed for impairment at least quarterly;

and carried at the lower of the initial capitalized amount, net of accumulated amortization, or estimated fair value.

21 unchanged sentences

A reporting unit is defined as any distinct, separately identifiable component of the Company’s one operating segment for which complete, discrete financial information is available and reviewed regularly by the segment’s management.

The Company has one reporting unit as of March 31, 2026, which is related to its banking activities.

The Company has one reporting unit as of June 30, 2026, which is related to its banking activities.

The impairment testing process is conducted by assigning net assets and goodwill to the Company’s reporting unit.

12 unchanged sentences

Income from the increase in cash surrender value of the policies as well as the receipt of death benefits is included in non-interest income on the consolidated statements of operations.

New Markets Tax Credits - As a part of its commitment to the communities it serves, in the first quarter of 2022 and the third quarter of 2024, the Company made investments in LLC’s that are sponsoring community development projects that have been awarded New Markets Tax Credits (“NMTC”) through the U.S.

Tax Credits - As a part of its commitment to the communities it serves, in the first quarter of 2022 and the third quarter of 2024, the Bank made investments in LLC’s that are sponsoring community development projects that have been awarded New Markets Tax Credits (“NMTC”) through the U.S.

Department of the Treasury’s Community Development Financial Institutions Fund.

These investments are Community Reinvestment Act eligible and are designed to generate a return primarily through the realization of the tax credit.

These LLC’s are considered a Variable Interest Entity (VIE) as the Company represents the holder of the equity investment at risk.

However, the Company does not have the ability to direct the activities that most significantly affect the performance of the LLC.

As such, the Company is not the primary beneficiary of the VIE and

the LLCs have not been consolidated.

These LLC’s are considered a Variable Interest Entity (VIE) as the Bank represents the holder of the equity investment at risk.

However, the Bank does not have the ability to direct the activities that most significantly affect the performance of the LLC.

As such, the Bank is not the primary beneficiary of the VIE and the LLCs have not been

consolidated.

With the adoption of ASU 2023-02 on January 1, 2023, the investments are accounted for using the proportional amortization method, which requires amortizing the investment in the period of and in proportion to the recognition of the related tax credit.

1 unchanged sentence

Prior to the adoption of ASU 2023-02 the investment was accounted for using the equity method of accounting and was amortized through non-interest expense.

As of March 31, 2026 and December 31, 2025, the carrying amount of this investment, which is included in other assets in the consolidated balance sheets, was $ 7,447 and $ 7,707 , respectively.

As of June 30, 2026 and December 31, 2025, the carrying amount of this investment, which is included in other assets in the consolidated balance sheets, was $ 2,920 and $ 3,440 , respectively.

The risk of loss with this investment is limited to its carrying value and is tied to its ability to operate in compliance with the rules and regulations necessary for the qualification of the tax credit generated by the investment.

As of March 31, 2026, there were no known instances of noncompliance associated with either investment.

As of June 30, 2026, there were no known instances of noncompliance associated with either investment.

In 2025, the Bank made an investment in a solar tax entity, primarily with locations in Wisconsin and Minnesota, which will be fully funded in 2026.

The investment is accounted for using the proportional amortization method, which requires amortizing the investment in the period of and in proportion to the recognition of the related tax credit and other tax benefits from tax depreciation.

Amortization of the investment is included in provision for income taxes and the utilization of the tax credit and other tax benefits is recorded as a reduction in provision for income taxes.

As of June 30, 2026 and December 31, 2025, the carrying amount of this investment, which is the contractual amount to be funded net of proportional tax credit amortization, was $ 4,101 and $ 4,267 , respectively, and is included in other assets in the consolidated balance sheets.

This amount is subject to change based on the completion of the various unfunded projects which will be completed in 2026.

As of June 30, 2026, there were no known instances of noncompliance associated with this investment.

Leases - We determine if an arrangement is a lease at inception.

20 unchanged sentences

While time based restricted shares are subject to forfeiture, time based restricted stock award participants may exercise full voting rights and will receive all dividends and other distributions paid with respect to the restricted shares.

The time based restricted shares granted under the 2018 Equity Incentive Plan are subject to a three-year vesting period.

Compensation expense for time based restricted stock is recognized over the requisite service period of three years for the entire award on a straight-line basis.

The time based restricted shares granted under the 2018 Equity Incentive Plan and the 2026 Omnibus Incentive Plan are subject to a three-year vesting period.

Compensation expense for time based restricted stock is recognized

over the requisite service period of three years for the entire award on a straight-line basis.

Performance based restricted shares are earned over a three-year period based on Board approved performance metrics and expense is recorded based on expected shares vesting.

3 unchanged sentences

Income Taxes – The Company accounts for income taxes in accordance with the Financial Accounting Standards Board (FASB) Accounting Standards Codification (“ASC”) Topic 740, “Income Taxes.” Under this guidance, deferred taxes are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis.

Deferred tax assets and liabilities are measured using enacted tax

rates that will apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

Deferred tax assets and liabilities are measured using enacted tax rates that will apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities of a change in tax rates is recognized as income or expense in the period that includes the enactment date.

5 unchanged sentences

Accordingly, the Company’s evaluation is based on current tax laws as well as management’s expectations of future performance.

The Company’s effective tax rates were 18.9 % and 19.6 % for the three months ended March 31, 2026 and March 31, 2025, respectively.

The Company’s effective tax rates were 17.2 % and 19.4 % for the six months ended June 30, 2026 and June 30, 2025, respectively.

Revenue Recognition - The Company’s primary source of revenue is interest income from interest earning assets, which is recognized on the accrual basis of accounting using the effective interest method.

15 unchanged sentences

Gain (loss) on repossessed assets - The Company records a gain or loss from the sale of repossessed assets, when control of the property or asset transfers to the buyer, which generally occurs at the time of an executed deed or sales agreement.

When the Company finances the sale of repossessed assets to a buyer, the Company assesses whether the buyer is committed to perform their obligations under the contract and whether collectability of the transaction price is probable.

When the Company finances the sale of repossessed assets to a buyer, the Company assesses whether the

buyer is committed to perform their obligations under the contract and whether collectability of the transaction price is probable.

Once these criteria are met, the repossessed asset is derecognized and the gain or loss on sale is recorded upon transfer of control of the property to the buyer.

19 unchanged sentences

However, the fair value of the forward loan sale agreement related to such loan commitment should increase by substantially the same amount, effectively eliminating the Company’s interest rate and price risks.

At March 31, 2026 and December 31, 2025, the Company had $ 5,414 and $ 5,456 , respectively, of loan commitments outstanding related to loans being originated for sale, all of which were subject to interest rate lock commitments and corresponding forward loan sale agreements, as described above.

The net fair values of outstanding interest rate-lock commitments and forward sale agreements were considered immaterial to the Company’s consolidated financial statements as of March 31, 2026.

At June 30, 2026 and December 31, 2025, the Company had $ 6,348 and $ 5,456 , respectively, of loan commitments outstanding related to loans being originated for sale, all of which were subject to interest rate lock commitments and corresponding forward loan sale agreements, as described above.

The net fair values of outstanding interest rate-lock commitments and forward sale agreements were considered immaterial to the Company’s consolidated financial statements as of June 30, 2026.

Common Stock Repurchased - The Company is incorporated in Maryland.

10 unchanged sentences

ASU 2024-03, Income Statement, Reporting of Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses— This ASU, issued in November 2024, is effective for fiscal years beginning after December 15, 2027, and interim periods therein, with early adoption permitted.

Disaggregation of Income Statement Expenses— This ASU, issued in November 2024, is effective for fiscal years beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early adoption permitted.

This ASU requires more detailed note disclosure about the types of expenses in commonly presented expense captions.

6 unchanged sentences

NOTE 2 – INVESTMENT SECURITIES

The amortized cost and fair value of securities available for sale and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income as of March 31, 2026 and December 31, 2025, respectively, were as follows:

The amortized cost and fair value of securities available-for-sale and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income as of June 30, 2026 and December 31, 2025, respectively, were as follows:

Available-for-sale securities Amortized

Losses Estimated

March 31, 2026

June 30, 2026

government agency obligations $ 7,257 $ 11 $ 39 $ 7,229

9 unchanged sentences

Total available-for-sale securities $ 151,618 $ 177 $ 17,692 $ 134,103

The amortized cost and fair value of securities held-to-maturity and the corresponding amounts of gross unrecognized gains and losses as of March 31, 2026 and December 31, 2025, respectively, were as follows:

The amortized cost and fair value of securities held-to-maturity and the corresponding amounts of gross unrecognized gains and losses as of June 30, 2026 and December 31, 2025, respectively, were as follows:

Held-to-maturity securities Amortized

Losses Estimated

March 31, 2026

June 30, 2026

Obligations of states and political subdivisions $ 300 $ — $ 9 $ 291

5 unchanged sentences

Total held-to-maturity securities $ 80,210 $ 6 $ 16,099 $ 64,117

At March 31, 2026, the Bank has pledged certain of its mortgage-backed securities with a carrying value of $ 31,633 as collateral to secure a line of credit with the Federal Reserve Bank.

As of March 31, 2026, there were no borrowings outstanding on this Federal Reserve Bank line of credit.

As of March 31, 2026, the Bank has pledged certain of its U.S.

At June 30, 2026, the Bank has pledged certain of its mortgage-backed securities with a carrying value of $ 31,118 as collateral to secure a line of credit with the Federal Reserve Bank.

As of June 30, 2026, there were no borrowings outstanding on this Federal Reserve Bank line of credit.

As of June 30, 2026, the Bank has pledged certain of its U.S.

Government Agency securities with a carrying value of $ 42 and mortgage-backed securities with a carrying value of $ 1,675 as collateral against specific municipal deposits.

As of March 31, 2026, the Bank also has mortgage-backed securities with a carrying value of $ 386 pledged as collateral to the Federal Home Loan Bank of Des Moines.

As of June 30, 2026, the Bank also has mortgage-backed securities with a carrying value of $ 373 pledged as collateral to the Federal Home Loan Bank of Des Moines.

At December 31, 2025, the Bank had pledged certain of its mortgage-backed securities with a carrying value of $ 32,056 as collateral to secure a line of credit with the Federal Reserve Bank.

3 unchanged sentences

As of December 31, 2025, the Bank also had mortgage-backed securities with a carrying value of $ 401 , pledged as collateral to the Federal Home Loan Bank of Des Moines.

For the three month periods ended March 31, 2026 and March 31, 2025, there were no sales of available for sale securities.

The estimated fair value of securities at March 31, 2026 and December 31, 2025, by contractual maturity, is shown below.

March 31, 2026 December 31, 2025

For the six month periods ended June 30, 2026 and June 30, 2025, there were no sales of available-for-sale securities.

The estimated fair value of securities at June 30, 2026 and December 31, 2025, by contractual maturity, is shown below:

June 30, 2026 December 31, 2025

Available-for-sale securities Amortized

9 unchanged sentences

Total available-for-sale securities $ 145,282 $ 128,435 $ 151,618 $ 134,103

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Held-to-maturity securities Amortized

7 unchanged sentences

Total held-to-maturity securities $ 77,415 $ 61,481 $ 80,210 $ 64,117

Securities with unrealized losses at March 31, 2026 and December 31, 2025, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, were as follows:

Securities with unrealized losses at June 30, 2026 and December 31, 2025, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, were as follows:

Less than 12 Months 12 Months or More Total

3 unchanged sentences

Value Unrealized

March 31, 2026

June 30, 2026

government agency obligations $ 1,496 $ 2 $ 3,095 $ 37 $ 4,591 $ 39

9 unchanged sentences

Total $ 7,658 $ 65 $ 108,598 $ 17,627 $ 116,256 $ 17,692

At March 31, 2026, no ACL was established for available-for-sale or held-to-maturity securities.

At June 30, 2026, no ACL was established for available-for-sale or held-to-maturity securities.

Substantially all the held-to-maturity portfolio is made up of agency backed mortgage securities.

1 unchanged sentence

government, are highly rated by major rating agencies, and have a long history of no credit losses.

At March 31, 2026, there were no past due held to maturity securities.

At June 30, 2026, there were no past due held-to-maturity securities.

Accordingly, the Company does not expect to incur credit losses on these securities.

32 unchanged sentences

Interest on substantially all loans is credited to income based on the principal amount outstanding.

A summary of loans at March 31, 2026, and December 31, 2025, follows:

March 31, 2026

A summary of loans at June 30, 2026, and December 31, 2025, follows:

June 30, 2026

December 31, 2025

38 unchanged sentences

This classification does not mean that the loan has absolutely no recovery or salvage value, and a partial recovery may occur in the future.

As of March 31, 2026, and December 31, 2025, there were no loans classified as doubtful with a risk rating of 8 and no loans classified as loss with a risk rating of 9.

As of June 30, 2026 and December 31, 2025, there were no loans classified as doubtful with a risk rating of 8 and no loans classified as loss with a risk rating of 9.

Residential and consumer loans are typically not rated until they are past due 90 days at month-end which is why they are classified as pass graded 1-5 and once 90 days past due at month-end or nonaccrual, get assigned a grade 7.

Below is a summary of the amortized cost of loans summarized by class, credit quality risk rating and year of origination as of March 31, 2026, and gross charge-offs for the three months ended March 31, 2026:

Below is a summary of the amortized cost of loans summarized by class, credit quality risk rating and year of origination as of June 30, 2026, and gross charge-offs for the six months ended June 30, 2026:

Amortized Cost Basis by Origination Year

131 unchanged sentences

Total current period gross charge-offs $ — $ 5 $ 46 $ 74 $ — $ 3 $ 39 $ — $ 167

Allowance for Credit Losses - Loans- The ACL is comprised of collectively evaluated and individually evaluated components.

The allowance for credit losses (“ACL”) represents the Company’s best estimate of the reserve necessary to adequately account for probable losses expected over the remaining life of the assets.

Allowance for Credit Losses - Loans- The allowance for credit losses (“ACL”) is comprised of collectively evaluated and individually evaluated components.

In determining the allowance, the Company estimates credit losses over the loan’s entire contractual term, adjusted for expected prepayments when appropriate.

The provision for credit losses is the charge against current earnings that is determined by the Company as the amount needed to maintain an adequate allowance for credit losses.

3 unchanged sentences

The Company estimates the appropriate level of allowance for credit losses by evaluating loans collectively on a pooled basis when similar risk characteristics exist, and on an individual basis when management determines that a loan does not share similar risk characteristics with other loans.

The following tables present the balance and activity in the allowance for credit losses (“ACL”) - loans by portfolio segment for the three months ended March 31, 2026:

The following tables present the balance and activity in the allowance for credit losses (“ACL”) - loans by portfolio segment for the three and six months ended June 30, 2026:

Commercial/Agricultural Real Estate C&I/Agricultural operating Residential Mortgage Consumer Installment Total

Three months ended March 31, 2026

Three months ended June 30, 2026

Allowance for Credit Losses - Loans:

2 unchanged sentences

Recoveries — 2 — 4 6

Additions to ACL - Loans via provision for credit losses charged to operations 3,744 493 108 5 4,350

ACL - Loans, at end of period $ 21,421 $ 2,272 $ 2,047 $ 159 $ 25,899

Commercial/Agricultural Real Estate C&I/Agricultural operating Residential Mortgage Consumer Installment Total

Six months ended June 30, 2026

Allowance for Credit Losses - Loans:

ACL - Loans, at beginning of period $ 17,654 $ 2,358 $ 2,230 $ 159 $ 22,401

Charge-offs ( 591 ) ( 1,032 ) — ( 1 ) ( 1,624 )

Recoveries — 2 5 7 14

Additions/(reversals) to ACL - Loans via provision for credit losses charged to operations 4,358 944 ( 188 ) ( 6 ) 5,108

ACL - Loans, at end of period $ 21,421 $ 2,272 $ 2,047 $ 159 $ 25,899

The following tables present the balance and activity in the allowance for credit losses (“ACL”) - loans by portfolio segment for the three months ended March 31, 2025 and the twelve months ended December 31, 2025:

The following tables present the balance and activity in the allowance for credit losses (“ACL”) - loans by portfolio segment for the three and six months ended June 30, 2025, and the twelve months ended December 31, 2025:

Commercial/Agricultural Real Estate C&I/Agricultural operating Residential Mortgage Consumer Installment Total

Three months ended March 31, 2025

Three months ended June 30, 2025

Allowance for Credit Losses - Loans:

2 unchanged sentences

Recoveries 52 1 — 5 58

(Reversals)/additions to ACL - Loans via provision for credit losses charged to operations ( 261 ) 75 ( 152 ) ( 13 ) ( 351 )

Additions/(reversals) to ACL - Loans via provision for credit losses charged to operations 868 294 9 ( 13 ) 1,158

ACL - Loans, at end of period $ 17,164 $ 1,658 $ 2,347 $ 178 $ 21,347

Commercial/Agricultural Real Estate C&I/Agricultural operating Residential Mortgage Consumer Installment Total

Six months ended June 30, 2025

Allowance for Credit Losses - Loans:

ACL - Loans, at beginning of period $ 16,516 $ 1,330 $ 2,489 $ 214 $ 20,549

Charge-offs ( 51 ) ( 87 ) — ( 18 ) ( 156 )

Recoveries 92 46 1 8 147

Additions/(reversals) to ACL - Loans via provision for credit losses charged to operations 607 369 ( 143 ) ( 26 ) 807

ACL - Loans, at end of period $ 17,164 $ 1,658 $ 2,347 $ 178 $ 21,347

Commercial/Agricultural Real Estate C&I/Agricultural operating Residential Mortgage Consumer Installment Total

Twelve months ended December 31, 2025

3 unchanged sentences

Recoveries 92 51 53 29 225

(Reversals)/additions to ACL - Loans via provision for credit losses charged to operations 1,097 1,071 ( 312 ) ( 62 ) 1,794

Additions/(reversals) to ACL - Loans via provision for credit losses charged to operations 1,097 1,071 ( 312 ) ( 62 ) 1,794

ACL - Loans, at end of period $ 17,654 $ 2,358 $ 2,230 $ 159 $ 22,401

Allowance for Credit Losses - Unfunded Commitments - In addition to the ACL - Loans, the Company has established an ACL - Unfunded Commitments of $ 482 at March 31, 2026, and $ 490 at December 31, 2025, classified in other liabilities on the consolidated balance sheets.

The following table presents the balance and activity in the ACL - Unfunded Commitments for the three months ended March 31, 2026 and March 31, 2025.

March 31, 2026 and Three Months Ended March 31, 2025 and Three Months Ended

Allowance for Credit Losses - Unfunded Commitments - In addition to the ACL - Loans, the Company has established an ACL - Unfunded Commitments of $ 457 at June 30, 2026, and $ 490 at December 31, 2025, classified in other liabilities on the consolidated balance sheets.

The following table presents the balance and activity in the ACL - Unfunded Commitments for the three and six months ended June 30, 2026 and June 30, 2025.

June 30, 2026 and Three Months Ended June 30, 2025 and Three Months Ended June 30, 2026 and Six Months Ended June 30, 2025 and Six Months Ended

ACL - Unfunded Commitments - beginning of period $ 482 $ 435 $ 490 $ 334

3 unchanged sentences

The following table presents the components of the provision for credit losses.

March 31, 2026 and Three Months Ended March 31, 2025 and Three Months Ended

June 30, 2026 and Three Months Ended June 30, 2025 and Three Months Ended June.

30, 2026 and Six Months Ended June.

30, 2025 and Six Months Ended

Provision for credit losses on:

2 unchanged sentences

Total provision for credit losses $ 4,325 $ 1,350 $ 5,075 $ 1,100

An aging analysis of the Company’s commercial/agricultural real estate, C&I, agricultural operating, residential mortgage, consumer installment and purchased third party loans as of March 31, 2026, and December 31, 2025, respectively, was as follows:

An aging analysis of the Company’s commercial/agricultural real estate, C&I, agricultural operating, residential mortgage, consumer installment and purchased third party loans as of June 30, 2026, and December 31, 2025, respectively, was as follows:

(Loan balances at amortized cost) 30-59 Days Past Due 60-89 Days Past Due Greater Than 89 Days Past Due Total

Past Due Current Total

March 31, 2026

June 30, 2026

Commercial/Agricultural real estate:

31 unchanged sentences

Total $ 2,950 $ 706 $ 10,625 $ 14,281 $ 1,326,044 $ 1,340,325

Nonaccrual Loans - The following tables present the amortized cost basis of loans on nonaccrual status, of nonaccrual loans individually evaluated and of loans past due over 89 days and still accruing at March 31, 2026 and December 31, 2025, with no allowance for credit losses:

March 31, 2026 Total Nonaccrual Loans Nonaccrual with no Allowance for Credit Losses Loans Past Due over 89 Days Still Accruing

Nonaccrual Loans - The following tables present the amortized cost basis of loans on nonaccrual status, of nonaccrual loans individually evaluated and of loans past due over 89 days and still accruing at June 30, 2026 and December 31, 2025, with no allowance for credit losses:

June 30, 2026 Total Nonaccrual Loans Nonaccrual with no Allowance for Credit Losses Loans Past Due over 89 Days Still Accruing

Commercial/Agricultural real estate:

30 unchanged sentences

Once interest accruals are discontinued, accrued but uncollected interest is charged against current year income.

Subsequent receipts on non-accrual loans are recorded as a reduction of principal, and interest income is recorded only after principal recovery is reasonably assured.

Subsequent receipts on nonaccrual loans are recorded as a reduction of principal, and interest income is recorded only after principal recovery is reasonably assured.

Interest on loans determined to be modified is recognized on an accrual basis in accordance with the restructured terms if the loan is in compliance with the modified terms.

3 unchanged sentences

For collateral dependent loans, expected credit losses are based on the fair value of the collateral at the balance sheet date, with consideration for estimated selling costs if satisfaction of the loan depends on the sale of the collateral.

The following tables present the amortized cost basis of collateral dependent loans by portfolio segment and collateral type that were individually evaluated to determine expected credit losses and the related allowance for credit losses as of March 31, 2026, and December 31, 2025.

Collateral Type

March 31, 2026 Real Estate Other Assets Total Without an Allowance With an Allowance Allowance Allocation

June 30, 2026 Real Estate Other Assets Total

Commercial/Agricultural real estate:

12 unchanged sentences

Collateral Type

December 31, 2025 Real Estate Other Assets Total Without an Allowance With an Allowance Allowance Allocation

December 31, 2025 Real Estate Other Assets Total

Commercial/Agricultural real estate:

11 unchanged sentences

Total $ 20,319 $ 3,206 $ 23,525

There were no outstanding commitments to borrowers experiencing financial difficulty as of March 31, 2026.

There were no unused lines of credit on loans with borrowers experiencing financial difficulties as of March 31, 2026.

The tables below detail Loan Modifications Made to Borrowers Experiencing Financial Difficulty during the three months ended March 31, 2026:

There were no outstanding commitments to borrowers experiencing financial difficulty as of June 30, 2026.

There were no unused lines of credit on loans with borrowers experiencing financial difficulties as of June 30, 2026.

There were no loan modifications made to borrowers experiencing financial difficulty during the three months ended June 30, 2026.

The tables below detail Loan Modifications made to Borrowers Experiencing Financial Difficulty during the twelve months ended June 30, 2026:

Term Extension

Loan Class Amortized Cost Basis at March 31, 2026 % of Total Class of Financing Receivables

Loan Class Amortized Cost Basis at June 30, 2026 % of Total Class of Financing Receivables

Commercial and industrial $ 28 0.02 %

Other-Than-Insignificant Payment Delay

Loan Class Amortized Cost Basis at March 31, 2026 % of Total Class of Financing Receivables

Loan Class Amortized Cost Basis at June 30, 2026 % of Total Class of Financing Receivables

Agricultural real estate $ 1,984 2.78 %

Residential mortgage $ 120 0.10 %

The following tables describe the financial effect of the loan modifications made to borrowers experiencing financial difficulty during the twelve months ended June 30, 2026:

Term Extension

4 unchanged sentences

Agricultural real estate Payments were deferred a weighted average of 6 months

The tables below detail Loan Modifications made to Borrowers Experiencing Financial Difficulty during the twelve months ended March 31, 2026:

Residential mortgage Payments were deferred a weighted average of 3 months

The tables below detail Loan Modifications Made to Borrowers Experiencing Financial Difficulty during the three months ended June 30, 2025:

Term Extension

Loan Class Amortized Cost Basis at March 31, 2026 % of Total Class of Financing Receivables

Commercial and industrial $ 798 0.70 %

Loan Class Amortized Cost Basis at June 30, 2025 % of Total Class of Financing Receivables

Commercial real estate $ 164 0.02 %

Other-Than-Insignificant Payment Delay

Loan Class Amortized Cost Basis at March 31, 2026 % of Total Class of Financing Receivables

Loan Class Amortized Cost Basis at June 30, 2025 % of Total Class of Financing Receivables

Commercial real estate $ 4,263 0.62 %

Agricultural real estate $ 200 0.29 %

Residential mortgage $ 120 0.10 %

The following tables describe the financial effect of the loan modifications made to borrowers experiencing financial difficulty during the twelve months ended March 31, 2026:

The following tables describe the financial effect of the loan modifications made to borrowers experiencing financial difficulty during the three months ended June 30, 2025:

Term Extension

Loan Class Financial Effect

Commercial and industrial A weighted average of 6 months was added to the term of the loans

Commercial real estate A weighted average of 2 months was added to the term of the loans

Other-Than-Insignificant Payment Delay

2 unchanged sentences

Agricultural real estate Payments were deferred a weighted average of 9 months

Residential mortgage Payments were deferred a weighted average of 3 months

The tables below detail Loan Modifications Made to Borrowers Experiencing Financial Difficulty during the three months ended March 31, 2025:

Other-Than-Insignificant Payment Delay

Loan Class Amortized Cost Basis at March 31, 2025 % of Total Class of Financing Receivables

Commercial real estate $ 322 0.05 %

Residential mortgage $ 120 0.09 %

The following tables describe the financial effect of the loan modifications made to borrowers experiencing financial difficulty during the three months ended March 31, 2025:

Other-Than-Insignificant Payment Delay

Loan Class Financial Effect

Commercial real estate Payments were deferred a weighted average of 3 months

Residential mortgage Payments were deferred a weighted average of 3 months

The tables below detail Loan Modifications Made to Borrowers Experiencing Financial Difficulty during the twelve months ended March 31, 2025:

The tables below detail Loan Modifications Made to Borrowers Experiencing Financial Difficulty during the twelve months ended June 30, 2025:

Term Extension

Loan Class Amortized Cost Basis at March 31, 2025 % of Total Class of Financing Receivables

Loan Class Amortized Cost Basis at June 30, 2025 % of Total Class of Financing Receivables

Commercial real estate $ 164 0.02 %

Commercial and industrial $ 661 0.61 %

2 unchanged sentences

Other-Than-Insignificant Payment Delay

Loan Class Amortized Cost Basis at March 31, 2025 % of Total Class of Financing Receivables

Loan Class Amortized Cost Basis at June 30, 2025 % of Total Class of Financing Receivables

Commercial real estate $ 5,738 0.83 %

Commercial and industrial $ 801 0.73 %

Agricultural real estate $ 200 0.29 %

Residential mortgage $ 120 0.10 %

Term Extension and Principal Forgiveness

Loan Class Amortized Cost Basis at March 31, 2025 % of Total Class of Financing Receivables

Loan Class Amortized Cost Basis at June 30, 2025 % of Total Class of Financing Receivables

Other consumer $ 2 — %

The following tables describe the financial effect of the loan modifications made to borrowers experiencing financial difficulty during the twelve months ended March 31, 2025:

The following tables describe the financial effect of the loan modifications made to borrowers experiencing financial difficulty during the twelve months ended June 30, 2025:

Term Extension

Loan Class Financial Effect

Commercial real estate A weighted average of 2 months was added to the term of the loans

Commercial and industrial A weighted average of 13 months was added to the term of the loans

4 unchanged sentences

Commercial real estate Payments were deferred a weighted average of 3 months

Commercial and industrial Payments were deferred a weighted average of 3 months

Agricultural real estate Payments were deferred a weighted average of 9 months

Residential mortgage Payments were deferred a weighted average of 3 months

3 unchanged sentences

The Company closely monitors the performance of loans that have been modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts.

The following table shows the performance of such loans that have been modified during the twelve months ended March 31, 2026.

The following table shows the performance of such loans that have been modified during the twelve months ended June 30, 2026.

Current 30-59 Days Past Due 60-89 Days Past Due Greater Than 89 Days Past Due

Commercial real estate $ 4,264 $ — $ — $ —

Agricultural real estate $ 1,984 $ — $ — $ —

Commercial and industrial — — — 28

Agricultural operating — — — —

Residential mortgage — 120 — —

Other consumer — — — —

Total $ 1,984 $ 120 $ — $ 28

The following table shows the performance of such loans that have been modified during the twelve months ended March 31, 2025.

The following table shows the performance of such loans that have been modified during the twelve months ended June 30, 2025.

Current 30-59 Days Past Due 60-89 Days Past Due Greater Than 89 Days Past Due

Commercial real estate $ 5,902 $ — $ — $ —

Agricultural real estate 200 — — —

Commercial and industrial 661 — — —

5 unchanged sentences

Mortgage servicing rights-- Mortgage loans serviced for others are not included in the accompanying consolidated balance sheets.

The unpaid balances of these loans as of March 31, 2026 and December 31, 2025 were $ 472,967 and $ 474,045 , respectively, and consisted of one to four family residential real estate loans.

The unpaid balances of these loans as of June 30, 2026 and December 31, 2025, were $ 471,803 and $ 474,045 , respectively, and consisted of one to four family residential real estate loans.

These loans are serviced primarily for the Federal Home Loan Mortgage Corporation, Federal Home Loan Bank and the Federal National Mortgage Association.

Custodial escrow balances maintained in connection with the foregoing loan servicing, and included in deposits were $ 4,923 and $ 2,841 at March 31, 2026 and December 31, 2025, respectively.

Mortgage servicing rights activity for the three month periods ended March 31, 2026 and March 31, 2025, were as follows:

As of and for the Three Months Ended As of and for the Three Months Ended

March 31, 2026 March 31, 2025

Custodial escrow balances maintained in connection with the foregoing loan servicing, and included in deposits were $ 5,450 and $ 2,841 at June 30, 2026 and December 31, 2025, respectively.

Mortgage servicing rights activity for the three and six month periods ended June 30, 2026 and June 30, 2025, were as follows:

As of and for the Three Months Ended As of and for the Three Months Ended As of and for the Six Months Ended As of and for the Six Months Ended

June 30, 2026 June 30, 2025 June 30, 2026 June 30, 2025

Mortgage servicing rights:

12 unchanged sentences

The current period change in valuation allowance, if applicable, is included in non-interest expense as mortgage servicing rights expense, net on the consolidated statement of operations.

Servicing fees totaled $ 299 and $ 300 for the three months ended March 31, 2026 and March 31, 2025, respectively.

Servicing fees totaled $ 299 and $ 301 for the three months ended June 30, 2026 and June 30, 2025, respectively.

Servicing fees totaled $ 599 and $ 602 for the six months ended June 30, 2026 and June 30, 2025, respectively.

Servicing fees are included in loan servicing income on the consolidated statement of operations.

3 unchanged sentences

Central to the valuation model is the discount rate.

Fair value at March 31, 2026 and March 31, 2025, was determined using discount rates ranging from 9.625 % to 12.625 %.

Fair value at June 30, 2026, was determined using discount rates ranging from 9.750 % to 12.750 %.

Fair value at June 30, 2025, was determined using discount rates ranging from 9.500 % to 12.500 %.

Other assumptions utilized in the valuation model include, but are not limited to, prepayment speed, servicing costs, delinquencies, costs of advances, foreclosure costs, ancillary income, and income earned on float and escrow.

NOTE 5 – LEASES

We have operating leases for 1 corporate office, 2 bank branch offices, 1 former bank branch office, and 1 ATM location.

We have operating leases for 1 corporate office, 2 bank branch offices, and 1 ATM location.

Our leases have remaining lease terms ranging from approximately 0.33 to 2.25 years.

Some of the leases include an option to extend, the longest of which is for two 5 year terms.

As of March 31, 2026, we have no lease commitments that have not yet commenced.

As of June 30, 2026, we have no lease commitments that have not yet commenced.

The Company also leases a portion of some of its facilities and receives rental income from such lease agreements, all of which are considered operating leases.

Three Months Ended

March 31, 2026 March 31, 2025

June 30, 2026 June 30, 2025

The components of total lease cost were as follows:

7 unchanged sentences

Operating cash flows from operating leases $ 251 $ 252

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Supplemental balance sheet information related to leases was as follows:

17 unchanged sentences

NOTE 6 – DEPOSITS

The following is a summary of deposits by type at March 31, 2026 and December 31, 2025, respectively:

March 31, 2026 December 31, 2025

The following is a summary of deposits by type at June 30, 2026 and December 31, 2025, respectively:

June 30, 2026 December 31, 2025

Non-interest bearing demand deposits $ 274,822 $ 264,394

4 unchanged sentences

Total deposits $ 1,554,417 $ 1,524,099

At March 31, 2026, the scheduled maturities of certificate accounts were as follows for the year ended, except December 31, 2026, which is the nine months ended:

At June 30, 2026, the scheduled maturities of certificate accounts were as follows for the year ended, except December 31, 2026, which is the six months ended:

December 31, 2026 $ 231,708

5 unchanged sentences

Total $ 341,799

Certificate accounts of $250 or more were $ 54,337 and $ 57,136 at March 31, 2026 and December 31, 2025, respectively.

Brokered deposits were $ 5,495 at March 31, 2026 and consisted of no brokered certificate accounts and $ 5,495 of brokered money market accounts.

Certificate accounts of $250 or more were $ 53,501 and $ 57,136 at June 30, 2026 and December 31, 2025, respectively.

Brokered deposits were $ 5,229 at June 30, 2026 and consisted of no brokered certificate accounts and $ 5,229 of brokered money market accounts.

Brokered deposits were $ 5,168 at December 31, 2025 and consisted of no brokered certificate accounts and $ 5,168 of brokered money market accounts.

NOTE 7 – FEDERAL HOME LOAN BANK ADVANCES AND OTHER BORROWINGS

A summary of Federal Home Loan Bank advances and other borrowings at March 31, 2026 and December 31, 2025, is as follows:

March 31, 2026

A summary of Federal Home Loan Bank advances and other borrowings at June 30, 2026 and December 31, 2025, is as follows:

June 30, 2026

December 31, 2025

11 unchanged sentences

Totals $ 51,885 $ 51,804

(1) The FHLB advances bear fixed rates, require interest-only monthly payments, and are collateralized by a blanket lien on pre-qualifying first mortgages, home equity lines, multi-family loans, and certain other loans which had pledged balances of $ 1,039,266 and $ 1,017,631 at March 31, 2026 and December 31, 2025, respectively.

At March 31, 2026, the Bank’s available and unused portion under the FHLB borrowing arrangement was approximately $ 410,062 compared to $ 433,654 as of December 31, 2025.

(2) Maximum month-end borrowed amounts outstanding under this borrowing agreement were $ 0 and $ 5,000 , during the three months ended March 31, 2026 and the twelve months ended December 31, 2025, respectively.

(3) There were no FHLB borrowings outstanding as of March 31, 2026 and December 31, 2025.

(1) The FHLB advances bear fixed rates, require interest-only monthly payments, and are collateralized by a blanket lien on pre-qualifying first mortgages, home equity lines, multi-family loans, and certain other loans which had pledged balances of $ 1,054,168 and $ 1,017,631 at June 30, 2026 and December 31, 2025, respectively.

At June 30, 2026, the Bank’s available and unused portion under the FHLB borrowing arrangement was approximately $ 427,527 compared to $ 433,654 as of December 31, 2025.

(2) Maximum month-end borrowed amounts outstanding under this borrowing agreement were $ 0 and $ 5,000 , during the six months ended June 30, 2026 and the twelve months ended December 31, 2025, respectively.

(3) There were no FHLB borrowings outstanding as of June 30, 2026 and December 31, 2025.

(4) Senior notes, entered into by the Company consist of the following:

(a) A $ 12,000 term note, which was originally entered into in June 2019 and subsequently refinanced in March 2022, modified in February of 2023, and refinanced in May 2024, requiring quarterly interest-only payments through January 2029, and quarterly principal and interest payments thereafter.

(a) A $ 12,000 term note, which was originally entered into in June 2019 and subsequently refinanced in March 2022, modified in February 2023, and refinanced in May 2024, requiring quarterly interest-only payments through January 2029, and quarterly principal and interest payments thereafter.

Interest is variable, based on US Prime rate minus 75 basis points with a floor rate of 3.00 %.

8 unchanged sentences

three-month term SOFR plus 329 basis points.

The note is callable by the Bank when, and anytime after, the floating rate is initially set.

The note is callable by the Company when, and anytime after, the floating rate is initially set.

Interest-only payments are due semi-annually each year during the fixed interest period and quarterly during the floating interest period.

2 unchanged sentences

This irrevocable standby letter of credit (“LOC”) is supported by loan collateral as an alternative to directly pledging investment securities on behalf of a municipal customer as collateral for their interest bearing deposit balances.

The LOC balances were $ 203,250 and $ 171,000 at March 31, 2026 and December 31, 2025, respectively.

The LOC balances were $ 192,500 and $ 171,000 at June 30, 2026 and December 31, 2025, respectively.

Federal Reserve Borrowings

At March 31, 2026 and December 31, 2025, the Bank had the ability to borrow $ 23,950 and $ 24,942 from the Federal Reserve Bank of Minneapolis.

The ability to borrow is based on mortgage-backed securities pledged with a carrying value of $ 31,633 and $ 32,056 as of March 31, 2026 and December 31, 2025, respectively.

There were no Federal Reserve borrowings outstanding as of March 31, 2026, and December 31, 2025.

At June 30, 2026 and December 31, 2025, the Bank had the ability to borrow $ 23,672 and $ 24,484 from the Federal Reserve Bank of Minneapolis.

The ability to borrow is based on mortgage-backed securities pledged with a carrying value of $ 31,118 and $ 32,056 as of June 30, 2026 and December 31, 2025, respectively.

There were no Federal Reserve borrowings outstanding as of June 30, 2026, and December 31, 2025.

Federal Funds Purchased Lines of Credit

As of March 31, 2026 and December 31, 2025, the Bank maintained two unsecured federal funds purchased lines of credit with its banking partners which totaled $ 70,000 .

As of June 30, 2026 and December 31, 2025, the Bank maintained two unsecured federal funds purchased lines of credit with its banking partners which totaled $ 70,000 .

These lines bear interest at the lender bank’s announced daily federal funds rate, mature daily and are revocable at the discretion of the lending institution.

There were no borrowings outstanding on these lines of credit as of March 31, 2026, or December 31, 2025.

There were no borrowings outstanding on these lines of credit as of June 30, 2026, or December 31, 2025.

NOTE 8 - CAPITAL MATTERS

7 unchanged sentences

If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required.

At March 31, 2026, the Bank was categorized as “Well Capitalized”, under Prompt Corrective Action Provisions.

The Bank’s Tier 1 (leverage) and risk-based capital ratios at March 31, 2026 and December 31, 2025, respectively, are presented below:

At June 30, 2026, the Bank was categorized as “Well Capitalized”, under Prompt Corrective Action Provisions.

The Bank’s Tier 1 (leverage) and risk-based capital ratios at June 30, 2026 and December 31, 2025, respectively, are presented below:

Actual For Capital Adequacy

3 unchanged sentences

Amount Ratio Amount Ratio Amount Ratio

As of March 31, 2026

As of June 30, 2026

Total capital (to risk weighted assets) $ 217,120 14.2 % $ 122,375 > = 8.0 % $ 152,969 > = 10.0 %

7 unchanged sentences

Tier 1 leverage ratio (to adjusted total assets) 194,639 11.3 % 68,711 > = 4.0 % 85,888 > = 5.0 %

The Company’s Tier 1 (leverage) and risk-based capital ratios at March 31, 2026 and December 31, 2025, respectively, are presented below:

The Company’s Tier 1 (leverage) and risk-based capital ratios at June 30, 2026 and December 31, 2025, respectively, are presented below:

Actual For Capital Adequacy

Amount Ratio Amount Ratio

As of March 31, 2026

As of June 30, 2026

Total capital (to risk weighted assets) $ 225,950 14.7 % $ 122,605 > = 8.0 %

11 unchanged sentences

The aggregate number of shares of common stock initially reserved and available for issuance under the 2018 Equity Incentive Plan was 350,000 shares.

As of March 31, 2026, 343,148 restricted shares had been granted under this plan.

As of June 30, 2026, no stock options were granted under this plan and 349,648 restricted shares were granted under this plan.

This amount includes 11,180 shares of performance based restricted stock granted in 2023 and issued in January 2026 upon achievement of the performance criteria and completion of the three-year performance period beginning in January 2023 and ending December 31, 2025.

The amount also includes 16,021 shares of performance based restricted stock granted in 2022 and issued in January 2025 upon achievement of the performance criteria and completion of the three year performance period beginning in January 2022 and ending December 31, 2024.

As of March 31, 2026, no stock options had been granted under this plan.

On June 16, 2026, the stockholders of Citizens Community Bancorp, Inc.

approved the 2026 Omnibus Incentive Plan for a term of 10 years.

The aggregate number of shares of common stock initially reserved and available for issuance under the 2026 Omnibus Incentive Plan was 300,000 shares.

As of June 30, 2026, no shares and no stock options had been granted under this plan.

As of June 16, 2026, the remaining 352 shares authorized to be issued under the 2018 Equity Incentive Plan were cancelled upon approval of the 2026 Omnibus Incentive Plan.

In February 2008, the Company’s stockholders approved the Company’s 2008 Equity Incentive Plan for a term of 10 years.

Due to the plan’s expiration, no new awards can be granted under this plan.

As of March 31, 2026, there are no awarded unvested restricted shares, and 30,500 awarded unexercised vested options remaining from the plan.

As of June 30, 2026, there are no awarded unvested restricted shares, and 14,500 awarded unexercised vested options remaining from the plan.

Options granted under this plan vested pro rata over a five-year period from the grant date and were fully vested as of October 2022.

Unexercised incentive stock options expire within 10 years of the grant date.

Stock based compensation expense related to restricted stock awards from these plans was $ 4 for the three months ended March 31, 2026, compared to $ 68 for the three months ended March 31, 2025.

Stock based compensation expense related to restricted stock awards from these plans was $ 8 and $ 12 for the three and six months ended June 30, 2026, compared to $ 34 and $ 102 for the three and six months ended June 30, 2025.

Restricted Common Stock Award

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Number of Shares Weighted

6 unchanged sentences

Unvested and outstanding at end of period 6,500 $ 20.63 6,109 $ 12.36

March 31, 2026

June 30, 2026

Number of Shares Weighted

15 unchanged sentences

Term in Years Aggregate

March 31, 2026

June 30, 2026

Outstanding at beginning of year 35,500 $ 11.98

8 unchanged sentences

Information related to the 2008 Equity Incentive Plan for the respective periods follows:

Three months ended March 31, 2025 Twelve months ended December 31, 2025

Six months ended June 30, 2026 Twelve months ended December 31, 2025

Intrinsic value of options exercised $ 197 $ 84

14 unchanged sentences

The time based cash awards vest ratably over a three-year time period.

time based awards, the ultimate cash payout of these awards will be based on the closing share price of the Company’s common stock on the anniversary of the award date each year.

On January 23, 2025, time based awards were based on 15,044 shares and performance based awards were based on 15,049 shares.

On January 25, 2024, the Company’s board of directors approved a phantom stock plan as part of the Company’s long-term incentive plan.

The Plan allows certain employees to earn future cash awards linked to the company’s future common share price for time and performance based cash awards.

The performance based cash awards vest based on a combination of a three-year time period from January 25, 2024 through December 31, 2026, and performance targets based on the Company’s return on equity.

For performance based awards, the ultimate cash payout of these awards will be paid within 60 days of December 31, 2026, based on the closing share price of the Company’s common stock as of the performance achievement approval date from the Compensation Committee.

The time based cash awards vest ratably over a three-year time period.

For time based awards, the ultimate cash payout of these awards will be based on the closing share price of the Company’s common stock on the anniversary of the award date each year.

1 unchanged sentence

At the end of each reporting period, the Company estimates its potential liability related to the plan and records any change to this liability as compensation expense in the consolidated statement of operations.

At March 31, 2026 and December 31, 2025, the related liability was $ 477 and $ 494 , respectively, which is included in other liabilities on the consolidated balance sheet.

For the three months ended March 31, 2026 and March 31, 2025, the Company recorded related expense of $ 186 and $ 59 , respectively, which is included in compensation and related benefits/non-interest expense on the Company’s consolidated statement of operations.

At June 30, 2026 and December 31, 2025, the related liability was $ 752 and $ 494 , respectively, which is included in other liabilities on the consolidated balance sheet.

For the three months ended June 30, 2026 and June 30, 2025, the Company recorded related expense of $ 275 and $ 72 , respectively, which is included in compensation and related benefits/non-interest expense on the Company’s consolidated statement of operations.

For the six months ended June 30, 2026 and June 30, 2025, the Company recorded related expense of $ 461 and $ 131 , respectively, which is included in compensation and related benefits/non-interest expense on the Company’s consolidated statement of operations.

NOTE 10 – FAIR VALUE ACCOUNTING

11 unchanged sentences

Assets Measured on a Recurring Basis

The following tables present the financial instruments measured at fair value on a recurring basis as of March 31, 2026 and December 31, 2025:

The following tables present the financial instruments measured at fair value on a recurring basis as of June 30, 2026 and December 31, 2025:

Value Quoted Prices in

3 unchanged sentences

(Level 2) Significant

March 31, 2026

June 30, 2026

Investment securities:

24 unchanged sentences

(1) Investments valued at NAV are excluded from being reported under the fair value hierarchy but are presented to permit reconciliation with the balance sheet in accordance with ASC 820-10-35-54B.

At March 31, 2026 and December 31, 2025, the Company owned $ 1,125 of preferred equity investments for which the Company utilized significant unobservable inputs (Level 3 inputs) to determine fair value.

There were no transfers in or out of Level 1, Level 2 or Level 3 fair value measurements relating to the available-for-sale securities above during the three month periods ended March 31, 2026 and March 31, 2025.

There were no losses included in earnings attributable to the change in unrealized gains or losses relating to the available-for-sale securities above with fair value measurements utilizing significant unobservable inputs for the three month periods ended March 31, 2026 and March 31, 2025.

At June 30, 2026 and December 31, 2025, the Company owned $ 1,125 preferred equity investments for which the Company utilized significant unobservable inputs (Level 3 inputs) to determine fair value.

There were no transfers in or out of Level 1, Level 2 or Level 3 fair value measurements relating to the available-for-sale securities above during the three and six month periods ended June 30, 2026 and June 30, 2025.

There were no losses included in earnings attributable to the change in unrealized gains or losses relating to the available-for-sale securities above with fair value measurements utilizing significant unobservable inputs for the three and six month periods ended June 30, 2026 and June 30, 2025.

Assets Measured on Nonrecurring Basis

The following tables present the financial instruments measured at fair value on a nonrecurring basis as of March 31, 2026 and December 31, 2025:

The following tables present the financial instruments measured at fair value on a nonrecurring basis as of June 30, 2026 and December 31, 2025:

Carrying Value Quoted Prices in

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(Level 2) Significant

March 31, 2026

June 30, 2026

Foreclosed and repossessed assets, net $ 850 $ — $ — $ 850

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recurring and nonrecurring basis and for which we have utilized Level 3 inputs to determine their fair value at

March 31, 2026 and December 31, 2025:

June 30, 2026 and December 31, 2025:

Value Valuation Techniques (1) Significant Unobservable Inputs (2) Range

March 31, 2026

June 30, 2026

Foreclosed and repossessed assets, net $ 850 Appraisal value Estimated costs to sell 10 % - 15 %

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The carrying amount and estimated fair value of the Company’s financial instruments as of the dates indicated below were as follows:

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Valuation Method Used Carrying

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A reconciliation of the basic and diluted earnings per share is as follows:

Three Months Ended

(Share count in thousands) March 31, 2026 March 31, 2025

Three Months Ended Six Months Ended

(Share count in thousands) June 30, 2026 June 30, 2025 June 30, 2026 June 30, 2025

Net income attributable to common stockholders $ 1,102 $ 3,270 $ 4,857 $ 6,467

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Diluted earnings per share $ 0.11 $ 0.33 $ 0.50 $ 0.65

Additional common stock option shares that have not been included due to their antidilutive effect — —

Dilutive shares outstanding consist of exercisable stock options whose strike prices were less than the quarterly average closing price of the Company’s common stock.

At March 31, 2026 and March 31, 2025, there were no exercisable stock options with a potentially dilutive effect excluded from diluted shares outstanding.

At June 30, 2026 and June 30, 2025, there were no exercisable stock options with a potentially dilutive effect excluded from diluted shares outstanding.

All exercisable stock options had stock prices less than the quarterly average closing price of the Company’s common stock.

NOTE 12 – OTHER COMPREHENSIVE INCOME

The following tables show the tax effects allocated to each component of other comprehensive income for the three months ended March 31, 2026 and 2025:

The following tables show the tax effects allocated to each component of other comprehensive income for the three and six months ended June 30, 2026 and 2025:

Three Months Ended

March 31, 2026 March 31, 2025

June 30, 2026 June 30, 2025

Amount Tax Benefit

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Other comprehensive income $ 344 $ ( 129 ) $ 215 $ 133 $ ( 52 ) $ 81

The changes in the accumulated balances for each component of other comprehensive income, net of tax for the twelve months ended December 31, 2025 and the three months ended March 31, 2026 were as follows:

Six Months Ended

June 30, 2026 June 30, 2025

Amount Tax Benefit

(Expense) Net-of-Tax

Amount Before-Tax

Amount Tax Benefit

(Expense) Net-of-Tax

Unrealized gains on securities:

Net unrealized gains arising during the period $ 668 $ ( 224 ) $ 444 $ 2,023 $ ( 487 ) $ 1,536

Other comprehensive income $ 668 $ ( 224 ) $ 444 $ 2,023 $ ( 487 ) $ 1,536

The changes in the accumulated balances for each component of other comprehensive income, net of tax for the twelve months ended December 31, 2025 and the six months ended June 30, 2026 were as follows:

Gains (Losses)

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Current year-to-date other comprehensive income 668 444

Ending balance, March 31, 2026 $ ( 17,191 ) $ ( 12,238 )

There were no reclassifications out of accumulated other comprehensive income for the three month periods ended March 31, 2026 and March 31, 2025.

Ending balance, June 30, 2026 $ ( 16,847 ) $ ( 12,023 )

There were no reclassifications out of accumulated other comprehensive income for the three and six month periods ended June 30, 2026 and June 30, 2025.

NOTE 13 – SEGMENT INFORMATION

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All operations are domestic.

Three Months Ended

March 31, 2026 March 31, 2025

Three Months Ended Six Months Ended

June 30, 2026 June 30, 2025 June 30, 2026 June 30, 2025

Interest and dividend income $ 22,034 $ 22,502 $ 43,550 $ 43,605

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Reconciliation of assets:

March 31, 2026 December 31, 2025

June 30, 2026 June 30, 2025 June 30, 2026 June 30, 2025

Total assets for reportable segments $ 1,814,309 $ 1,735,164 $ 1,814,309 $ 1,735,164

2 unchanged sentences

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

What changed 10-Q

Item 1. Financial Statements