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Item 1. Financial Statements

2025-05-09 compared with 2024-11-08 · 249 added, 338 removed, 1249 unchanged (32% of the section changed)

5 unchanged sentences

We have reviewed the accompanying interim consolidated financial information of The First Bancorp, Inc.

and Subsidiary as of September 30, 2024 and 2023 and for the three-month and nine-month periods then ended, and the related notes (collectively referred to as the "interim financial information").

and Subsidiary as of March 31, 2025 and 2024 and for the three-month periods then ended, and the related notes (collectively referred to as the "interim financial information").

Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial information for them to be in conformity with accounting principles generally accepted in the United States of America.

7 unchanged sentences

Portland, Maine

November 8, 2024

Consolidated Balance Sheets (Unaudited) The First Bancorp, Inc.

Consolidated Balance Sheets (Unaudited)

The First Bancorp, Inc.

and Subsidiary

September 30, 2024 December 31, 2023 September 30, 2023

March 31, 2025 December 31, 2024 March 31, 2024

Cash and cash equivalents $ 26,432,000 $ 27,636,000 $ 23,875,000

1 unchanged sentence

Securities available for sale 280,764,000 274,680,000 274,451,000

Securities held-to-maturity (net of ACL), fair value of $ 333,575,000 at September 30, 2024, $ 338,570,000 at December 31, 2023 and $ 311,864,000 at September 30, 2023

Securities held-to-maturity (net of ACL), fair value of $ 312,788,000 at March 31, 2025, $ 314,993,000 at December 31, 2024 and $ 327,816,000 at March 31, 2024

368,571,000 369,704,000 379,453,000

Restricted equity securities, at cost 7,509,000 7,203,000 5,933,000

Loans held for sale — — 268,000

Loans 2,383,150,000 2,340,940,000 2,173,746,000

25 unchanged sentences

Net unrealized loss on securities transferred from available-for-sale to held-to-maturity ( 45,000 ) ( 47,000 ) ( 54,000 )

Net unrealized (loss) gain on cash flow hedging derivative instruments ( 136,000 ) 300,000 1,410,000

Net unrealized gain on cash flow hedging derivative instruments 82,000 157,000 735,000

Net unrealized gain on postretirement costs 287,000 287,000 303,000

7 unchanged sentences

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

Consolidated Statements of Income and Comprehensive Income (Loss) (Unaudited)

Consolidated Statements of Income and Comprehensive Income (Unaudited)

The First Bancorp, Inc.

and Subsidiary

For the nine months ended September 30, For the quarter ended September 30,

2024 2023 2024 2023

For the three months ended March 31,

Interest income

Interest and fees on loans (includes YTD tax-exempt income of $ 1,824,000 for September 30, 2024 and $ 1,362,000 for September 30, 2023)

Interest and fees on loans (includes YTD tax-exempt income of $ 721,000 for March 31, 2025 and $ 521,000 for March 31, 2024)

$ 33,924,000 $ 30,204,000

Interest on deposits with other banks 56,000 78,000

Interest and dividends on investments (includes YTD tax-exempt income of $ 5,971,000 for September 30, 2024 and $ 6,030,000 for September 30, 2023)

Interest and dividends on investments (includes YTD tax-exempt income of $ 1,955,000 for March 31, 2025 and $ 1,995,000 for March 31, 2024)

4,729,000 4,706,000

5 unchanged sentences

Net interest income 17,799,000 14,880,000

Credit loss (reduction) expense - loans 58,000 419,000 ( 580,000 ) ( 161,000 )

Credit loss (reduction) expense - debt securities HTM ( 210,000 ) ( 7,000 ) 76,000 3,000

Credit loss (reduction) expense - off-balance sheet credit exposures ( 487,000 ) 89,000 ( 134,000 ) ( 42,000 )

Total credit loss (reduction) expense ( 639,000 ) 501,000 ( 638,000 ) ( 200,000 )

Credit loss expense - loans 396,000 99,000

Credit loss expense (reduction) - debt securities HTM 1,000 ( 252,000 )

Credit loss reduction - off-balance sheet credit exposures ( 5,000 ) ( 360,000 )

Total credit loss expense (reduction) 392,000 ( 513,000 )

Net interest income after provision for credit losses 17,407,000 15,393,000

24 unchanged sentences

Other comprehensive gain (loss) 3,896,000 ( 2,804,000 )

Comprehensive income (loss) $ 24,515,000 $ 14,577,000 $ 15,679,000 $ ( 1,866,000 )

Comprehensive income $ 10,973,000 $ 3,217,000

See Report of Independent Registered Public Accounting Firm.

3 unchanged sentences

and Subsidiary

Nine Month Period Ended September 30, 2024 and 2023

Three Month Period Ended March 31, 2025 and 2024

Common stock and

17 unchanged sentences

Proceeds from sale of common stock 8,048 204,000 — — 204,000

Adoption of ASU No.

2016-13 ( 6,277,000 ) ( 6,277,000 )

Balance at September 30, 2023 11,089,290 $ 69,760,000 $ 209,132,000 $ ( 52,227,000 ) $ 226,665,000

Balance at March 31, 2024 11,130,933 $ 70,617,000 $ 213,839,000 $ ( 41,832,000 ) $ 242,624,000

Balance at December 31, 2024 11,155,528 $ 71,944,000 $ 222,823,000 $ ( 42,274,000 ) $ 252,493,000

10 unchanged sentences

Proceeds from sale of common stock 8,840 225,000 — — 225,000

Balance at September 30, 2024 11,148,066 $ 71,500,000 $ 219,559,000 $ ( 34,276,000 ) $ 256,783,000

Three Month Period Ended September 30, 2024 and 2023

Common stock and

additional paid-in capital Retained

earnings Accumulated

comprehensive

income (loss) Total

shareholders'

Shares Amount

Balance at June 30, 2023 11,081,800 $ 69,351,000 $ 205,539,000 $ ( 42,887,000 ) $ 232,003,000

Net income — — 7,474,000 — 7,474,000

Net unrealized loss on securities available for sale, net of tax — — — ( 10,071,000 ) ( 10,071,000 )

Net unrealized gain on securities transferred from available for sale to held to maturity, net of tax — — — 1,000 1,000

Net unrealized gain on cash flow hedging derivative instruments, net of tax — — — 730,000 730,000

Comprehensive income (loss) — — 7,474,000 ( 9,340,000 ) ( 1,866,000 )

Cash dividends declared ($ 0.35 per share)

— — ( 3,881,000 ) — ( 3,881,000 )

Equity compensation expense — 210,000 — — 210,000

Issuance of restricted stock ( 250 ) — — — —

Proceeds from sale of common stock 7,740 199,000 — — 199,000

Balance at September 30, 2023 11,089,290 $ 69,760,000 $ 209,132,000 $ ( 52,227,000 ) $ 226,665,000

Balance at June 30, 2024 11,139,639 $ 71,053,000 $ 215,999,000 $ ( 42,384,000 ) $ 244,668,000

Net income — — 7,571,000 — 7,571,000

Net unrealized gain on securities available for sale, net of tax — — — 8,975,000 8,975,000

Net unrealized gain on securities transferred from available for sale to held to maturity, net of tax — — — 2,000 2,000

Net unrealized loss on hedging derivative instruments, net of tax — — — ( 869,000 ) ( 869,000 )

Comprehensive income (loss) — — 7,571,000 8,108,000 15,679,000

Cash dividends declared ($ 0.36 per share)

— — ( 4,011,000 ) — ( 4,011,000 )

Equity compensation expense — 230,000 — — 230,000

Payment to repurchase common stock ( 200 ) — — — —

Proceeds from sale of common stock 8,627 217,000 — — 217,000

Balance at September 30, 2024 11,148,066 $ 71,500,000 $ 219,559,000 $ ( 34,276,000 ) $ 256,783,000

Balance at March 31, 2025 11,196,881 $ 72,467,000 $ 225,592,000 $ ( 38,378,000 ) $ 259,681,000

See Report of Independent Registered Public Accounting Firm.

3 unchanged sentences

and Subsi diary

For the nine months ended September 30,

For the three months ended March 31,

Cash flows from operating activities

3 unchanged sentences

Change in deferred taxes 310,000 319,000

Credit loss (reduction) expense ( 639,000 ) 501,000

Credit loss expense (reduction) 392,000 ( 513,000 )

Loans originated for resale ( 3,041,000 ) ( 363,000 )

3 unchanged sentences

Net gain on sale of other real estate owned ( 33,000 ) —

Provision for losses on other real estate owned 35,000 —

Equity compensation expense 298,000 231,000

Net increase in other assets and accrued interest ( 3,631,000 ) ( 5,982,000 )

Net (decrease) increase in other liabilities ( 1,649,000 ) 8,156,000

Net loss on disposal of premises and equipment 9,000 33,000

Net decrease in other liabilities ( 3,214,000 ) ( 2,385,000 )

Net (gain) loss on disposal of premises and equipment ( 15,000 ) 9,000

Amortization of investment in limited partnership 309,000 117,000

Net acquisition amortization 7,000 7,000

Net cash provided by operating activities 14,638,000 26,193,000

Net cash provided (used) by operating activities 2,180,000 ( 1,497,000 )

Cash flows from investing activities

Increase in interest-bearing deposits in other banks ( 13,711,000 ) ( 34,673,000 )

Decrease in interest-bearing deposits in other banks 19,162,000 577,000

Proceeds from maturities, payments and calls of securities available for sale 8,471,000 5,359,000

2 unchanged sentences

Purchases of securities available for sale ( 9,652,000 ) ( 1,968,000 )

Purchases of securities to be held to maturity ( 2,750,000 ) —

Change in restricted equity securities ( 306,000 ) ( 2,548,000 )

Redemption of restricted equity securities — 23,000

Net increase in loans ( 42,363,000 ) ( 44,214,000 )

3 unchanged sentences

Cash flows from financing activities

Net increase in demand, savings, and money market accounts 47,977,000 79,565,000

Net increase in certificates of deposit 55,079,000 141,495,000

Net decrease in short-term borrowings ( 13,625,000 ) ( 20,490,000 )

Net decrease in demand, savings, and money market accounts ( 68,621,000 ) ( 45,854,000 )

Net increase (decrease) in certificates of deposit 54,705,000 ( 4,820,000 )

Net increase in short-term borrowings 64,166,000 15,127,000

Advances on long-term borrowings — 70,000,000

Repayment on long-term borrowings ( 25,000,000 ) —

Payment to repurchase common stock ( 277,000 ) ( 211,000 )

2 unchanged sentences

Net cash provided by financing activities 21,299,000 30,539,000

Net increase in cash and cash equivalents 3,194,000 7,166,000

Net decrease in cash and cash equivalents ( 1,204,000 ) ( 8,067,000 )

Cash and cash equivalents at beginning of period 27,636,000 31,942,000

Cash and cash equivalents at end of period $ 26,432,000 $ 23,875,000

For the nine months ended September 30,

For the three months ended March 31,

Interest paid $ 20,843,000 $ 19,521,000

Income taxes paid 3,577,000 4,500,000

Non-cash transactions

Change in net unrealized loss on available for sale securities, net of tax $ ( 3,969,000 ) $ 3,241,000

Net transfer from loans to other real estate owned 208,000 —

See Report of Independent Registered Public Accounting Firm.

11 unchanged sentences

For further information, refer to the consolidated financial statements and notes included in the Company's annual report on Form 10-K for the year ended December 31, 2024.

The abbreviations and definitions identified below are used throughout this Form 10-Q, including Item 1 - Financial Statements and Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations.

The abbreviations and definitions identified below may be used throughout this Form 10-Q, including Item 1 - Financial Statements and Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following is provided to aid the reader and provide a reference page when reviewing these sections of the Form 10-Q.

Abbreviation Description Abbreviation Description

ACL Allowance for credit losses GDP Gross domestic product

AFS Available-for-sale GNMA Government National Mortgage Association

ALCO Asset/Liability Committee HTM Held-to-maturity

AOCI Accumulated other comprehensive income (loss) IAL Individually Analyzed Loans

ASC Accounting Standards Codification IRS Internal Revenue Service

ASU Accounting Standards Update MPF Mortgage Partnership Finance Program

BTFP Bank Term Funding Program OAEM Other assets especially mentioned

C&I Commercial and Industrial OCC Office of the Comptroller of the Currency

CDs Certificates of deposit OCI Other comprehensive income (loss)

CECL Current Expected Credit Loss OIS Overnight Indexed Swap

CLLD Construction, land, and land development OREO Other real estate owned

EPS Earnings per share POR Period of Redemption

FASB Financial Accounting Standards Board PSA Public Securities Association

FDIC Federal Deposit Insurance Corporation SEC Securities and Exchange Commission

FHLB Federal Home Loan Bank SOFR Secured Overnight Financing Rate

FHLBB Federal Home Loan Bank of Boston TDR Troubled debt restructuring

ACL Allowance for credit losses GAAP Accounting principles generally accepted in the U.S.

AFS Available-for-sale GDP Gross domestic product

ALCO Asset/Liability Committee GNMA Government National Mortgage Association

AOCI Accumulated other comprehensive income (loss) HTM Held-to-maturity

ASC Accounting Standards Codification IAL Individually Analyzed Loans

ASU Accounting Standards Update IRS Internal Revenue Service

C&I Commercial and Industrial MPF Mortgage Partnership Finance Program

CDs Certificates of deposit OAEM Other assets especially mentioned

CECL Current Expected Credit Loss OCC Office of the Comptroller of the Currency

CET1 Common Equity Tier 1 OCI Other comprehensive income (loss)

CLLD Construction, land, and land development OIS Overnight Indexed Swap

EPS Earnings per share OREO Other real estate owned

FASB Financial Accounting Standards Board POR Period of Redemption

FDIC Federal Deposit Insurance Corporation PSA Public Securities Association

FHLB Federal Home Loan Bank SEC Securities and Exchange Commission

FHLBB Federal Home Loan Bank of Boston SOFR Secured Overnight Financing Rate

FHLMC Federal Home Loan Mortgage Corporation The 2020 Plan The 2020 Equity Incentive Plan

4 unchanged sentences

FRBB Federal Reserve Bank of Boston USD U.S.

GAAP Accounting principles generally accepted in the U.S.

Risks and Uncertainties

Ongoing conflicts between Russia and Ukraine, and Israel, Hamas and Hezbollah, continue to contribute to economic uncertainty and geopolitical instability.

Geopolitical tensions could also result in increased threat from cyberattacks or other disruptive activity.

Concern about the national commercial real estate market and the impact a downturn in this sector could have on the banking industry continues to be expressed, as does concern about the potential for a slowing economy.

Any or all could have negative downstream effects on the Company's operating results, the extent of which is indeterminable at this time.

Global markets have experienced heightened volatility amidst an escalation of trade disputes, the outcome of which is yet to be determined.

The ongoing conflicts between Russia and Ukraine, and Israel and Hamas, as well as other conflicts globally, have the potential to further increase economic uncertainty and geopolitical instability.

Finally, the 2024 U.S.

election resulted in single party control of the executive and legislative branches of the federal government, with pledges to reign in government spending and reform numerous policies including immigration, and business regulation.

Any or all could ultimately have negative downstream effects on the Company's operating results, the extent of which is indeterminable at this time.

Subsequent Events

Events occurring subsequent to September 30, 2024, have been evaluated as to their potential impact to the financial statements.

Events occurring subsequent to March 31, 2025, have been evaluated as to their potential impact to the financial statements.

Note 2 – Investment Securities

The following table summarizes the amortized cost and estimated fair value of investment securities at September 30, 2024:

The following table summarizes the amortized cost and estimated fair value of investment securities at March 31, 2025:

Cost Unrealized Gains Unrealized Losses Fair Value (Estimated)

37 unchanged sentences

$ 7,203,000 $ — $ — $ 7,203,000

The following table summarizes the amortized cost and estimated fair value of investment securities at September 30, 2023:

The following table summarizes the amortized cost and estimated fair value of investment securities at March 31, 2024:

Cost Unrealized Gains Unrealized Losses Fair Value (Estimated)

24 unchanged sentences

Similarly, the agency and mortgage-backed securities in the HTM portfolio have been determined to all be investment grade with no ACL required.

Municipal securities within HTM include two private activity bonds issued by well-known customers of the Bank with total balances of $ 19,146,000 as of September 30, 2024.

Municipal securities within HTM include two private activity bonds issued by well-known customers of the Bank with total balances of $ 18,841,000 as of March 31, 2025.

Corporate securities in HTM consist of 13 individual companies in the banking industry.

1 unchanged sentence

Aggregate credit risk of the private activity bonds and corporate securities is considered very low and an immaterial ACL has been established.

As of September 30, 2024 and 2023, and December 31, 2023, the total ACL for HTM securities was $ 224,000 , $ 432,000 and $ 434,000 , respectively.

As of March 31, 2025 and 2024, and December 31, 2024, the total ACL for HTM securities was $ 197,000 , $ 182,000 and $ 196,000 , respectively.

Changes in the ACL are recorded as credit loss expense, or reversal.

Losses would be charged against the allowance when management believes collection of the full contractual amount due on a security is unlikely.

The following table summarizes the contractual maturities of investment securities at September 30, 2024:

Contractual Maturities:

The following table summarizes the contractual maturities of investment securities at March 31, 2025:

Securities available for sale Securities to be held to maturity

15 unchanged sentences

$ 328,693,000 $ 274,680,000 $ 369,900,000 $ 314,993,000

The following table summarizes the contractual maturities of investment securities at September 30, 2023:

The following table summarizes the contractual maturities of investment securities at March 31, 2024:

Securities available for sale Securities to be held to maturity

6 unchanged sentences

$ 328,648,000 $ 274,451,000 $ 379,635,000 $ 327,816,000

At September 30, 2024, securities with a carrying value of $ 344,261,000 were pledged to secure public deposits, repurchase agreements, and for other purposes as required by law.

This compares to securities with a carrying value of $ 340,623,000 as of December 31, 2023 and $ 383,946,000 at September 30, 2023, pledged for the same purposes.

Pledged Securities:

At March 31, 2025, securities with a carrying value of $ 351,890,000 were pledged to secure public deposits, repurchase agreements, and for other purposes as required by law.

This compares to securities with a carrying value of $ 349,833,000 as of December 31, 2024 and $ 314,208,000 at March 31, 2024, pledged for the same purposes.

Realized Gains and Losses:

Gains and losses on the sale of securities are computed by subtracting the amortized cost at the time of sale from the security's selling price, net of accrued interest to be received.

There were no gains or losses on the sale of securities for the nine months ended September 30, 2024 and 2023.

As of September 30, 2024, there were 226 AFS securities with unrealized losses held in the Company's portfolio.

There were no gains or losses on the sale of securities for the three months ended March 31, 2025 and 2024.

Unrealized Gains and Losses on AFS Securities:

As of March 31, 2025, there were 237 AFS securities with unrealized losses held in the Company's portfolio.

The Company has the ability and intent to hold its securities which are in an unrealized loss position until a recovery of their amortized cost, which may be at maturity.

The following table summarizes AFS debt securities in an unrealized loss position for which an ACL has not been recorded at September 30, 2024, aggregated by major security type and length of time in a continuous unrealized loss position:

The following table summarizes AFS debt securities in an unrealized loss position for which an ACL has not been recorded at March 31, 2025, aggregated by major security type and length of time in a continuous unrealized loss position:

Less than 12 months 12 months or more Total

3 unchanged sentences

State and political subdivisions 4,862,000 ( 172,000 ) 27,720,000 ( 7,196,000 ) 32,582,000 ( 7,368,000 )

Asset-backed securities 1,173,000 ( 6,000 ) — — 1,173,000 ( 6,000 )

$ 15,009,000 $ ( 283,000 ) $ 232,643,000 $ ( 49,100,000 ) $ 247,652,000 $ ( 49,383,000 )

7 unchanged sentences

State and political subdivisions 4,968,000 ( 70,000 ) 28,104,000 ( 6,826,000 ) 33,072,000 ( 6,896,000 )

Asset-backed securities — — 1,464,000 ( 9,000 ) 1,464,000 ( 9,000 )

$ 23,512,000 $ ( 292,000 ) $ 234,055,000 $ ( 53,876,000 ) $ 257,567,000 $ ( 54,168,000 )

As of September 30, 2023, there were 239 AFS securities with unrealized losses held in the Company's portfolio.

As of March 31, 2024, there were 236 AFS securities with unrealized losses held in the Company's portfolio.

The Company has the ability and intent to hold its securities which are in an unrealized loss position until a recovery of their amortized cost, which may be at maturity.

The following table summarizes AFS debt securities in an unrealized loss position for which an ACL has not been recorded at September 30, 2023 aggregated by major security type and length of time in a continuous unrealized loss position:

The following table summarizes AFS debt securities in an unrealized loss position for which an ACL has not been recorded at March 31, 2024 aggregated by major security type and length of time in a continuous unrealized loss position:

Less than 12 months 12 months or more Total

3 unchanged sentences

State and political subdivisions 4,520,000 ( 30,000 ) 29,161,000 ( 6,308,000 ) 33,681,000 ( 6,338,000 )

Asset-backed securities — — 1,510,000 ( 4,000 ) 1,510,000 ( 4,000 )

$ 9,113,000 $ ( 46,000 ) $ 251,590,000 $ ( 54,270,000 ) $ 260,703,000 $ ( 54,316,000 )

7 unchanged sentences

High credit quality state and municipal obligations have a history of zero to near-zero credit loss.

All of the Mortgage-backed securities owned were issued either by a U.S.

Government Agency (GNMA) or a Government Sponsored Enterprise (FNMA or FHLMC).

All of the Mortgage-backed securities owned were issued either by GNMA, FNMA or FHLMC.

HTM municipal debt holdings also include two unrated private activity bonds issued by well known customers of the Bank.

These securities are regularly monitored as part of an overall credit relationship with the issuers;

both issuers were in good standing as of September 30, 2024.

both issuers were in good standing as of March 31, 2025.

HTM corporate debt holdings consist of 13 individual companies in the banking industry.

Management conducts periodic reviews of the collectability of these securities taking into consideration such factors as the financial condition of the issuers;

each were in good standing as of September 30, 2024.

The following table presents the activity in the ACL for HTM debt securities by major security type for the periods ended September 30, 2024 and 2023:

For the nine months ended September 30, 2024 For the nine months ended September 30, 2023

each were in good standing as of March 31, 2025.

ACL for HTM Securities:

The following table presents the activity in the ACL for HTM debt securities by major security type for the periods ended March 31, 2025 and 2024:

For the three months ended March 31, 2025 For the three months ended March 31, 2024

State and Political Subdivisions Corporate Securities Total State and Political Subdivisions Corporate Securities Total

1 unchanged sentence

Beginning balance $ 80,000 $ 116,000 $ 196,000 $ 212,000 $ 222,000 $ 434,000

Impact of adopting ASC 326 — — — 229,000 209,000 438,000

Credit loss (reduction) expense

3 unchanged sentences

Total ending allowance balance $ 81,000 $ 116,000 $ 197,000 $ 69,000 $ 113,000 $ 182,000

1 September 30, 2023 total of ( 6,000 ) will not tie to Consolidated Statement of Income Credit loss (reduction) expense - debt securities HTM due to rounding.

There was no ACL on U.S.

Government-sponsored enterprise, agency securities, or mortgage-backed securities as of September 30, 2024 .

Government-sponsored enterprise, agency securities, or mortgage-backed securities as of March 31, 2025 .

A security is considered to be past due once it is 30 days contractually past due under the terms of the agreement.

As of September 30, 2024, none of the Company’s HTM debt securities were past due or on non-accrual status.

As of March 31, 2025, none of the Company’s HTM debt securities were past due or on non-accrual status.

Re-Classified Securities:

3 unchanged sentences

The amortization of the net unrealized loss reported in AOCI will offset the effect on interest income of the discount for the transferred securities.

The remaining unamortized balance of the net unrealized losses for the securities transferred from available for sale to held to maturity was $ 49,000 , net of taxes, at September 30, 2024.

This compares to $ 56,000 and $ 58,000 , net of taxes, at December 31, 2023 and September 30, 2023, respectively.

The remaining unamortized balance of the net unrealized losses for the securities transferred from available for sale to held to maturity was $ 45,000 , net of taxes, at March 31, 2025.

This compares to $ 47,000 and $ 54,000 , net of taxes, at December 31, 2024 and March 31, 2024, respectively.

These securities were transferred as a part of the Company's overall investment and balance sheet strategies.

3 unchanged sentences

The Bank uses the FHLBB for a portion of its wholesale funding needs.

As of September 30, 2024 and 2023, and December 31, 2023, the Bank's investment in FHLBB stock totaled $ 5,383,000 , $ 2,823,000 and $ 2,348,000 , respectively.

As of March 31, 2025 and 2024, and December 31, 2024, the Bank's investment in FHLBB stock totaled $ 6,472,000 , $ 4,896,000 and $ 6,166,000 , respectively.

FHLBB stock is a non-marketable equity security and therefore is reported at cost, which equals par value.

2 unchanged sentences

The Bank uses FRBB for certain correspondent banking services and maintains borrowing capacity at its discount window.

The Bank's investment in FRBB stock totaled $ 1,037,000 at September 30, 2024 and 2023, and December 31, 2023.

The Bank's investment in FRBB stock totaled $ 1,037,000 at March 31, 2025 and 2024, and December 31, 2024.

The Company periodically evaluates its investment in FHLBB and FRBB stock for impairment based on, among other factors, the capital adequacy of the Banks and their overall financial condition.

No impairment losses have been recorded through September 30, 2024.

No impairment losses have been recorded through March 31, 2025.

The Bank will continue to monitor its investment in these restricted equity securities.

3 unchanged sentences

In addition home equity installment loans which had previously been included in the residential term class were included in the home equity revolving and term class.

In the first quarter of 2024, a new segment was established for Agriculture loans;

certain prior period information of these loans continues to be included in the C&I and CRE non-owner occupied segments.

In 2024, a new segment was established for Agriculture loans.

Loan Portfolio by Class:

The following table shows the composition of the Company's loan portfolio by class of financing receivable as of September 30, 2024 and 2023 and at December 31, 2023:

September 30, 2024 December 31, 2023 September 30, 2023

The following table shows the composition of the Company's loan portfolio by class of financing receivable as of March 31, 2025 and 2024 and at December 31, 2024:

March 31, 2025 December 31, 2024 March 31, 2024

Real estate owner occupied $ 370,465,000 15.5 % $ 358,588,000 15.3 % $ 327,496,000 15.1 %

10 unchanged sentences

Total $ 2,383,150,000 100.0 % $ 2,340,940,000 100.0 % $ 2,173,746,000 100.0 %

Loan balances include net deferred loan costs of $ 12,266,000 as of September 30, 2024, $ 11,479,000 as of December 31, 2023, and $ 11,213,000 as of September 30, 2023.

Loan balances include net deferred loan costs of $ 12,570,000 as of March 31, 2025, $ 12,457,000 as of December 31, 2024, and $ 11,745,000 as of March 31, 2024.

Net deferred loan costs have increased from a year ago and year-to-date based upon loan origination unit volume over the periods, prepayments, and normal repayment activity.

Loan balances in the Residential Term segment also include a valuation adjustment for fair value swaps hedged by certain loans in the portfolio.

This adjustment added $ 2,462,000 to the loan balances as of September 30, 2024, added $ 2,149,000 to the loan balances as of December 31, 2023 and subtracted $ 705,000 from the loan balances as of September 30, 2023.

Pursuant to collateral agreements, qualifying first mortgage loans and commercial real estate loans, which totaled $ 622,370,000 at September 30, 2024, were used to collateralize borrowings from the FHLBB.

This compares to qualifying loans which totaled $ 561,574,000 at December 31, 2023, and $ 525,904,000 at September 30, 2023.

In addition, commercial, residential construction and home equity loans totaling $ 364,068,000 at September 30, 2024, $ 320,083,000 at December 31, 2023, and $ 332,657,000 at September 30, 2023, were used to collateralize a standby line of credit at the FRBB.

This adjustment added $ 1,120,000 , $ 758,000 , and $ 313,000 to the loan balances as of March 31, 2025, December 31, 2024, and March 31, 2024, respectively.

Pledged Loans:

Pursuant to collateral agreements, qualifying first mortgage loans and commercial real estate loans, which totaled $ 631,410,000 at March 31, 2025, were used to collateralize borrowings from the FHLBB.

This compares to qualifying loans which totaled $ 626,851,000 at December 31, 2024, and $ 565,047,000 at March 31, 2024.

In addition, commercial, residential construction and home equity loans totaling $ 411,257,000 at March 31, 2025, $ 392,562,000 at December 31, 2024, and $ 322,124,000 at March 31, 2024, were used to collateralize a standby line of credit at the FRBB.

Past Due Loans:

For all loan classes, loans over 30 days past due are considered delinquent.

Information on the past-due status of loans by class of financing receivable as of September 30, 2024, is presented in the following table:

Information on the past-due status of loans by class of financing receivable as of March 31, 2025, is presented in the following table:

Past Due 60-89 Days

22 unchanged sentences

Multifamily — — — — 108,732,000 108,732,000 —

Agriculture 115,000 — — 115,000 52,104,000 52,219,000 —

Municipal — — — — 61,827,000 61,827,000 —

4 unchanged sentences

Total $ 2,654,000 $ 4,636,000 $ 2,093,000 $ 9,383,000 $ 2,331,557,000 $ 2,340,940,000 $ 1,020,000

Information on the past-due status of loans by class of financing receivable as of September 30, 2023, is presented in the following table:

Information on the past-due status of loans by class of financing receivable as of March 31, 2024, is presented in the following table:

Past Due 60-89 Days

6 unchanged sentences

Multifamily — — — — 101,344,000 101,344,000 —

Agriculture 119,000 — — 119,000 44,945,000 45,064,000 —

Municipal — — — — 54,746,000 54,746,000 —

10 unchanged sentences

As a general rule, a loan may be restored to accrual status when payments are current for a substantial period of time, generally six months, and repayment of the remaining contractual amounts is expected, or when it otherwise becomes well secured and in the process of collection.

The following table presents the amortized costs basis of loans on nonaccrual status as of September 30, 2024, December 31, 2023 and September 30, 2023:

September 30, 2024 December 31, 2023 September 30, 2023

The following table presents the amortized costs basis of loans on nonaccrual status as of March 31, 2025, December 31, 2024 and March 31, 2024:

March 31, 2025 December 31, 2024 March 31, 2024

Nonaccrual with Allowance for Credit Loss Nonaccrual with no Allowance for Credit Loss Total Nonaccrual Nonaccrual with Allowance for Credit Loss Nonaccrual with no Allowance for Credit Loss Total Nonaccrual Nonaccrual with Allowance for Credit Loss Nonaccrual with no Allowance for Credit Loss Total Nonaccrual

12 unchanged sentences

Individually Analyzed Loans:

IAL include loans with balances of $250,000 or more that have either been placed into non-accrual or are loans identified by management as having characteristics that may impact ultimate collectibility and therefore merit individual analysis.

IAL include loans with balances of $250,000 or more that have been placed into non-accrual or are loans identified by management as having characteristics that may impact ultimate collectibility and therefore merit individual analysis.

These loans are measured at the present value of expected future cash flows discounted at the loan's effective interest rate or at the fair value of the collateral if the loan is collateral dependent.

If the measure of an IAL loan is lower than the recorded investment in the loan and estimated selling costs, a specific reserve is established for the difference, or, in certain situations, if the measure of an IAL loan is lower than the recorded investment in the loan and estimated selling costs, the difference is written off.

The following table presents the amortized cost basis of collateral-dependent loans as of September 30, 2024, December 31, 2023 and September 30, 2023, by collateral type:

September 30, 2024 December 31, 2023 September 30, 2023

The following table presents the amortized cost basis of collateral-dependent loans as of March 31, 2025, December 31, 2024 and March 31, 2024, by collateral type:

March 31, 2025 December 31, 2024 March 31, 2024

Collateral Type Collateral Type Collateral Type

Dollars in thousands Commercial Real Estate Residential Real Estate Total Commercial Real Estate Residential Real Estate Total Commercial Real Estate Residential Real Estate Total

Commercial Real Estate Residential Real Estate Other Total Commercial Real Estate Residential Real Estate Other Total Residential Real Estate Total

Real estate owner occupied $ 260,000 $ — $ — $ 260,000 $ 263,000 $ — $ — $ 263,000 $ — $ —

13 unchanged sentences

It is the intent to minimize future losses while providing borrowers with financial relief.

The following table represents loan modifications made to borrowers experiencing financial difficulty by modification type and class of financing receivable, during the three months ended September 30, 2024:

Amortized Cost Basis

12 unchanged sentences

Total $ 2,682,000 $ 364,000 $ — $ — $ —

The following table describes the financial effect of the modifications made to borrowers experiencing financial difficulty for the three months ended September 30, 2024:

Payment Deferral & Term Extension

The following table describes the financial effect of the modifications made to borrowers experiencing financial difficulty for the three months ended March 31, 2025:

Payment Deferral

Financial Effect

C&I Temporary payment accommodation, extended term 90 days.

The following table represents loan modifications made to borrowers experiencing financial difficulty by modification type and class of financing receivable, during the nine months ended September 30, 2024:

Real estate owner occupied Temporary payment accommodation, payments deferred to end of loan.

C&I Temporary payment accommodation, payments deferred to end of loan.

Multifamily Temporary payment accommodation, payments deferred to end of loan.

Agriculture Temporary payment accommodation, payments deferred to end of loan.

Term Extension

Financial Effect

C&I Temporary payment accommodation, extended term 6 months.

Amortized Cost Basis

12 unchanged sentences

Total $ 3,085,000 $ — $ — $ — $ 69,000

The following tables describe the financial effect of the modifications made to borrowers experiencing financial difficulty for the nine months ended September 30, 2024:

The following table describes the financial effect of the modifications made to borrowers experiencing financial difficulty for the three months ended March 31, 2024:

Payment Deferral

Financial Effect

Real estate owner occupied Temporary payment accommodation, payments deferred to end of loan.

Construction Temporary payment accommodation, payments deferred to end of loan.

4 unchanged sentences

Financial Effect

C&I Temporary payment accommodation, extended term 90 days.

Revolving and term Temporary payment accommodation, extended term 60 days.

Amortized Cost Basis

Payment Deferral Term Extension Interest Rate Reduction Principal Forgiveness Combination Payment Deferral and Term Extension % of Total Class of Financing Receivable

Real estate owner occupied $ 504,000 $ — $ — $ — $ — 0.17 %

Real estate non-owner occupied — — — — — — %

Construction — — — — — — %

Revolving and Term Temporary payment accommodations, extended term 60 days.

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

The following table depicts loans that were modified during the previous 12 months as of March 31, 2025 which defaulted upon the modified terms at some point during the 12 month period:

Payment Status (Amortized Cost Basis)

Past Due 60-89 Days

Past Due 90+ Days

C&I $ — $ 170,000 $ —

Multifamily — — — — — — %

Agriculture — — — — — — %

Municipal — — — — — — %

Term 125,000 — —

Construction — — — — — — %

Revolving and term — — — — — — %

Consumer — — — — — — %

Total $ 125,000 $ 170,000 $ —

The following table describes the financial effect of the modifications made to borrowers experiencing financial difficulty for the three months ended September 30, 2023:

Payment Deferral

Financial Effect

Real estate owner occupied Temporary payment accommodation, payments deferred to end of loan.

C&I Temporary payment accommodation, payments deferred to end of loan.

Amortized Cost Basis

Payment Deferral Term Extension Interest Rate Reduction Principal Forgiveness Combination Payment Deferral and Term Extension % of Total Class of Financing Receivable

The following table depicts the performance of loans that have been modified during the previous 12 months as of March 31, 2025:

Payment Status (Amortized Cost Basis)

Current 30-59 Days

Past Due 60-89 Days

Past Due 90+ Days

Real estate owner occupied $ 792,000 $ — $ — $ —

Real estate non-owner occupied — — — — — — %

Construction — — — —

2 unchanged sentences

Agriculture 1,536,000 — — —

Municipal — — — — — — %

Term — 125,000 — —

Construction — — — — — — %

Revolving and term — — — —

1 unchanged sentence

Total $ 3,857,000 $ 125,000 $ — $ —

The following tables describe the financial effect of the modifications made to borrowers experiencing financial difficulty for the nine months ended September 30, 2023:

Payment Deferral

Financial Effect

Real estate owner occupied Temporary payment accommodation, payments deferred to end of loan.

C&I Temporary payment accommodation, payments deferred to end of loan.

Term Extension

Financial Effect

C&I Extended Term 12 months

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

The following table depicts the performance of loans that have been modified during the previous 12 months as of September 30, 2024:

The following table depicts loans that were modified during the previous 12 months as of March 31, 2024 which defaulted upon the modified terms at some point during the 12 month period:

Payment Status (Amortized Cost Basis)

Current 30-59 Days

Past Due 60-89 Days

1 unchanged sentence

Real estate owner occupied $ 501,000 $ — $ 283,000

Construction 69,000 — — —

C&I 29,000 — 35,000

Multifamily 1,932,000 — — —

Term — — 449,000

Revolving and term 68,000 — — —

Consumer — — 13,000

Total $ 530,000 $ — $ 780,000

The following table depicts the performance of loans that have been modified during the nine months ended September 30, 2023:

The following table depicts the performance of loans that had been modified during the the previous 12 months as of March 31, 2024:

Payment Status (Amortized Cost Basis)

3 unchanged sentences

Real estate owner occupied $ 786,000 $ — $ — $ —

Construction 69,000 — — —

C&I 96,000 — — —

Multifamily 1,932,000 — — —

Term 1,023,000 — — —

Revolving and term 70,000 — — —

Consumer 34,000 — — —

Total $ 4,010,000 $ — $ — $ —

Residential Mortgage Loans in Process of Foreclosure:

As of September 30, 2024, there were two mortgage loans collateralized by residential real estate in the process of foreclosure with a total balance of $ 127,000 .

This compares to five mortgage loans collateralized by residential real estate in the process of foreclosure with a total balance of $ 400,000 as of December 31, 2023, and four mortgage loans collateralized by residential real estate in the process of foreclosure with a total balance of $ 459,000 as of September 30, 2023.

As of March 31, 2025, there were four mortgage loans collateralized by residential real estate in the process of foreclosure with a total balance of $ 1,208,000 .

This compares to three mortgage loans collateralized by residential real estate in the process of foreclosure with a total balance of $ 192,000 as of December 31, 2024, and four mortgage loans collateralized by residential real estate in the process of foreclosure with a total balance of $ 510,000 as of March 31, 2024.

Allowance for Credit Losses

43 unchanged sentences

Loans are primarily paid by the cash flow generated from the agricultural property or operation of equipment.

Risk factors typically include competitive market forces, overall economic demand for the product, and may be further

influenced by weather conditions which impact growing and/or harvesting, or other factors such as changes in government regulation(s).

Risk factors typically include competitive market forces, overall economic demand for the product, and may be further influenced by weather conditions which impact growing and/or harvesting, or other factors such as changes in government regulation(s).

Residential Real Estate Term - residential term loans consist of residential real estate loans made to borrowers who demonstrate the ability to make scheduled payments with full consideration to underwriting factors.

23 unchanged sentences

Construction, land, and land development :

CLLD loans, both commercial and residential, represented 43.2 % of total Bank capital as of September 30, 2024 and remain below the regulatory guidance of 100.0 % of total Bank capital.

Construction loans and non-owner-occupied commercial real estate loans represented 225.9 % of total Bank capital at September 30, 2024, below the regulatory guidance of 300.0 % of total Bank capital.

CLLD loans, both commercial and residential, represented 38.3 % of total Bank capital as of March 31, 2025 and remain below the regulatory guidance of 100.0 % of total Bank capital.

Construction loans and non-owner-occupied commercial real estate loans represented 224.7 % of total Bank capital at March 31, 2025, below the regulatory guidance of 300.0 % of total Bank capital.

Composition of the ACL:

A breakdown of the ACL as of September 30, 2024, by class of financing receivable and allowance element, is presented in the following table:

As of September 30, 2024 Specific Reserves on Loans Evaluated Individually General Reserves on Loans Based on Historical Loss Experience Reserves for Qualitative Factors Total Reserves

A breakdown of the ACL as of March 31, 2025, by class of financing receivable and allowance element, is presented in the following table:

As of March 31, 2025 Specific Reserves on Loans Evaluated Individually General Reserves on Loans Based on Historical Loss Experience Reserves for Qualitative Factors Total Reserves

Real estate owner occupied $ — $ 4,472,000 $ 717,000 $ 5,189,000

17 unchanged sentences

Multifamily — 1,108,000 131,000 1,239,000

Agriculture — 449,000 156,000 605,000

Municipal — 35,000 227,000 262,000

4 unchanged sentences

$ 1,047,000 $ 20,714,000 $ 3,110,000 $ 24,871,000

A breakdown of the ACL as of September 30, 2023, by class of financing receivable and allowance element, is presented in the following table:

As of September 30, 2023 Specific Reserves on Loans Evaluated Individually General Reserves on Loans Based on Historical Loss Experience Reserves for Qualitative Factors Total Reserves

A breakdown of the ACL as of March 31, 2024, by class of financing receivable and allowance element, is presented in the following table:

As of March 31, 2024 Specific Reserves on Loans Evaluated Individually General Reserves on Loans Based on Historical Loss Experience Reserves for Qualitative Factors Total Reserves

Real estate owner occupied $ — $ 4,177,000 $ 1,003,000 $ 5,180,000

3 unchanged sentences

Multifamily — 1,348,000 159,000 1,507,000

Agriculture — 358,000 34,000 392,000

Municipal — 38,000 156,000 194,000

4 unchanged sentences

$ 243,000 $ 20,509,000 $ 3,455,000 $ 24,207,000

The ACL as a percent of total loans stood at 1.04 % as of September 30, 2024, 1.13 % at December 31, 2023 and 1.12 % as of September 30, 2023.

The ACL as a percent of total loans stood at 1.05 % as of March 31, 2025, 1.06 % at December 31, 2024 and 1.11 % as of March 31, 2024.

Off-Balance Sheet Credit Exposures:

8 unchanged sentences

The Company’s ACL on unfunded commitments is recognized as a liability, included within other liabilities on the consolidated balance sheet.

The following table presents the activity in the ACL for off-balance sheet credit exposures for the nine months and quarters ended September 30, 2024 and 2023:

For the nine months ended September 30, For the quarter ended September 30,

2024 2023 2024 2023

The following table presents the activity in the ACL for off-balance sheet credit exposures for the three months ended March 31, 2025 and 2024:

For the three months ended March 31,

Allowance for credit losses:

Beginning balance $ 714,000 $ 1,255,000

Impact of adopting ASC 326 — 1,297,000 — —

Credit loss (reduction) expense ( 487,000 ) 89,000 ( 134,000 ) ( 42,000 )

Credit loss reduction ( 5,000 ) ( 360,000 )

Total ending allowance balance $ 709,000 $ 895,000

26 unchanged sentences

Loans that are past due more than 90 days are considered non-performing.

The following table summarizes the credit quality for the Company's portfolio by risk category of loans and by class by vintage as of September 30, 2024:

The following table summarizes the credit quality for the Company's portfolio by risk category of loans and by class by vintage as of March 31, 2025:

Term Loans Amortized Cost Basis by Origination Year

Dollars in thousands 2025 2024 2023 2022 2021 Prior Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Total

As of September 30, 2024

As of March 31, 2025

Real estate owner occupied

38 unchanged sentences

Dollars in thousands 2025 2024 2023 2022 2021 Prior Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Total

As of September 30, 2024

As of March 31, 2025

Pass (risk rating 1-5) 1,937 9,186 18,563 3,984 3,881 17,553 — — 55,104

62 unchanged sentences

Doubtful (risk rating 8) — — — — — — — — —

Total Municipal 20,210 4,741 3,982 9,775 5,156 7,559 — — 51,423

Total Agriculture 11,694 3,298 6,521 3,917 14,651 6,777 5,146 215 52,219

Current period gross write-offs — — — — — — — — —

2 unchanged sentences

As of December 31, 2024

Pass (risk rating 1-5) 9,503 18,642 4,017 3,822 8,498 17,345 — — 61,827

Special Mention (risk rating 6) — — — — — — — — —

Substandard (risk rating 7) — — — — — — — — —

Doubtful (risk rating 8) — — — — — — — — —

Total Municipal 9,503 18,642 4,017 3,822 8,498 17,345 — — 61,827

Current period gross write-offs — — — — — — — — —

Performing 56,378 94,816 148,877 130,413 84,028 192,466 2,109 121 709,208

16 unchanged sentences

Total loans $ 321,530 $ 318,046 $ 435,131 $ 360,943 $ 215,046 $ 445,909 $ 231,203 $ 13,132 $ 2,340,940

The following table summarizes the credit quality for the Company's portfolio by risk category of loans and by class by vintage as of September 30, 2023:

The following table summarizes the credit quality for the Company's portfolio by risk category of loans and by class by vintage as of March 31, 2024:

Term Loans Amortized Cost Basis by Origination Year

Dollars in thousands 2024 2023 2022 2021 2020 Prior Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Total

As of September 30, 2023

As of March 31, 2024

Real estate owner occupied

34 unchanged sentences

Doubtful (risk rating 8) — — — — — — — — —

Total Municipal 24,527 6,239 4,121 10,226 5,270 8,064 — — 58,447

Total Agriculture 4,351 3,825 7,534 4,358 15,357 8,135 1,270 234 45,064

Current period gross write-offs — — — — — — — — —

1 unchanged sentence

Dollars in thousands 2024 2023 2022 2021 2020 Prior Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Total

As of September 30, 2023

As of March 31, 2024

Pass (risk rating 1-5) 2,420 21,146 4,714 4,335 9,770 12,361 — — 54,746

Special Mention (risk rating 6) — — — — — — — — —

Substandard (risk rating 7) — — — — — — — — —

Doubtful (risk rating 8) — — — — — — — — —

Total Municipal 2,420 21,146 4,714 4,335 9,770 12,361 — — 54,746

Current period gross write-offs — — — — — — — — —

Performing 10,439 64,948 157,400 138,399 91,824 209,986 3,011 127 676,134

23 unchanged sentences

This is subject to completion of a current assessment of the value of the collateral with any outstanding loan balance in excess of the fair value of the property, less costs to sell, written down or charged-off.

The following table presents ACL activity by class for the nine months and quarter ended September 30, 2024:

The following table presents ACL activity by class for the three months ended March 31, 2025:

Dollars in thousands Commercial Municipal Residential Home Equity Consumer Total

Real Estate Owner Occupied Real Estate Non-Owner Occupied Construction C&I Multifamily Agriculture Term Construction Revolving and term

For the nine months ended September 30, 2024

Beginning balance $ 4,633 $ 4,285 $ 1,978 $ 5,001 $ 1,318 $ — $ 334 $ 4,991 $ 618 $ 626 $ 246 $ 24,030

Charge offs — — — ( 88 ) — — — ( 36 ) — ( 7 ) ( 210 ) ( 341 )

Recoveries 100 — — 24 — — — 30 — 21 77 252

Credit loss (reduction) expense 386 686 ( 1,171 ) ( 275 ) ( 56 ) 613 ( 68 ) 66 ( 193 ) 23 47 58

Ending balance $ 5,119 $ 4,971 $ 807 $ 4,662 $ 1,262 $ 613 $ 266 $ 5,051 $ 425 $ 663 $ 160 $ 23,999

For the three months ended September 30, 2024

For the three months ended March 31, 2025

Beginning balance $ 5,045 $ 4,829 $ 944 $ 5,364 $ 1,239 $ 605 $ 262 $ 5,241 $ 474 $ 686 $ 182 $ 24,871

4 unchanged sentences

The following table presents ACL activity by class for the year ended December 31, 2024:

Dollars in thousands Commercial Municipal Residential Home Equity Consumer Unallocated Total

Real Estate Owner Occupied Real Estate Non-Owner Occupied Construction C&I Multifamily Term Construction Revolving and term

Dollars in thousands Commercial Municipal Residential Home Equity Consumer Total

Real Estate Owner Occupied Real Estate Non-Owner Occupied Construction C&I Multifamily Agriculture Term Construction Revolving and term

For the year ended December 31, 2024

Beginning balance prior to adoption of ASC 326 $ 6,116 $ — $ 821 $ 3,097 $ — $ 162 $ 2,559 $ 199 $ 1,029 $ 1,062 $ 1,678 $ 16,723

Charge offs ( 40 ) — — ( 153 ) — — — — ( 50 ) ( 194 ) — ( 437 )

Recoveries 2 75 — 3 — — 14 — 13 97 — 204

Credit loss (reduction) expense 241 ( 105 ) 214 409 134 40 540 ( 316 ) 90 83 — 1,330

Impact of adopting ASC 326 ( 1,686 ) 4,315 943 1,645 1,184 132 1,878 735 ( 456 ) ( 802 ) ( 1,678 ) 6,210

Ending balance $ 4,633 $ 4,285 $ 1,978 $ 5,001 $ 1,318 $ 334 $ 4,991 $ 618 $ 626 $ 246 $ — $ 24,030

The following table presents ACL activity by class for the nine months and quarter ended September 30, 2023:

Dollars in thousands Commercial Municipal Residential Home Equity Consumer Unallocated Total

Real Estate Owner Occupied Real Estate Non-Owner Occupied Construction C&I Multifamily Term Construction Revolving and term

For the nine months ended September 30, 2023

Beginning balance prior to adoption of ASC 326 $ 6,116 $ — $ 821 $ 3,097 $ — $ 162 $ 2,559 $ 199 $ 1,029 $ 1,062 $ 1,678 $ 16,723

Beginning balance $ 4,633 $ 4,285 $ 1,978 $ 5,001 $ 1,318 $ — $ 334 $ 4,991 $ 618 $ 626 $ 246 $ 24,030

Charge offs — — — ( 451 ) — — — ( 37 ) — ( 7 ) ( 252 ) ( 747 )

1 unchanged sentence

Credit loss (reduction) expense 312 544 ( 1,034 ) 789 ( 79 ) 605 ( 72 ) 255 ( 144 ) 43 85 1,304

Impact of adopting ASC 326 ( 1,686 ) 4,315 943 1,645 1,184 132 1,878 735 ( 456 ) ( 802 ) ( 1,678 ) 6,210

Ending balance $ 5,045 $ 4,829 $ 944 $ 5,364 $ 1,239 $ 605 $ 262 $ 5,241 $ 474 $ 686 $ 182 $ 24,871

For the three months ended September 30, 2023

The following table presents ACL activity by class for the three months ended March 31, 2024:

Dollars in thousands Commercial Municipal Residential Home Equity Consumer Total

Real Estate Owner Occupied Real Estate Non-Owner Occupied Construction C&I Multifamily Agriculture Term Construction Revolving and term

For the three months ended March 31, 2024

Beginning balance $ 4,633 $ 4,285 $ 1,978 $ 5,001 $ 1,318 $ — $ 334 $ 4,991 $ 618 $ 626 $ 246 $ 24,030

3 unchanged sentences

Ending balance $ 5,180 $ 4,265 $ 820 $ 5,083 $ 1,507 $ 392 $ 194 $ 5,354 $ 562 $ 677 $ 173 $ 24,207

As of September 30, 2024, the significant model inputs and assumptions used within the discounted cash flow model for purposes of estimating the ACL on loans were:

As of March 31, 2025, the significant model inputs and assumptions used within the discounted cash flow model for purposes of estimating the ACL on loans were:

Macroeconomic loss drivers :

1 unchanged sentence

• Commercial Real Estate Owner Occupied:

FOMC median forecast of national unemployment

FOMC median forecasts of national unemployment and change in national real GDP

• Commercial Real Estate Non-Owner Occupied:

FOMC median forecast of national unemployment

FOMC median forecasts of national unemployment and change in national real GDP

• Commercial Construction:

8 unchanged sentences

• Residential Real Estate Term:

FOMC median forecast of national unemployment

FOMC median forecasts of national unemployment and change in national real GDP

• Residential Real Estate Construction:

1 unchanged sentence

• Home Equity Revolving & Term:

FOMC median forecast of national unemployment

FOMC median forecasts of national unemployment and change in national real GDP

Reasonable and supportable forecast period:

12 unchanged sentences

Other compensation under the 2020 Plan qualifies as performance-based for purposes of Section 162(m) of the Internal Revenue Code, and satisfies NASDAQ guidelines relating to equity compensation.

As of September 30, 2024, 131,419 shares of restricted stock had been granted under the 2020 Plan, of which 87,218 shares remain restricted as of September 30, 2024 as detailed in the following table:

As of March 31, 2025, 172,916 shares of restricted stock had been granted under the 2020 Plan, of which 96,624 shares remain restricted as of March 31, 2025 as detailed in the following table:

Granted Vesting Term

5 unchanged sentences

2025 1.0 700 0.8

2024 2.0 1,869 1.3

2024 1.0 2,653 0.3

The compensation cost related to these non-vested restricted stock grants is $ 2,608,000 and is recognized over the vesting terms of each grant.

In the nine months ended September 30, 2024, $ 680,000 of expense was recognized for these restricted shares, leaving $ 1,006,000 in unrecognized expense as of September 30, 2024.

In the nine months ended September 30, 2023, $ 607,000 of expense was recognized for restricted shares, leaving $ 1,069,000 in unrecognized expense as of September 30, 2023.

In the three months ended March 31, 2025, $ 298,000 of expense was recognized for these restricted shares, leaving $ 1,598,000 in unrecognized expense as of March 31, 2025.

In the three months ended March 31, 2024, $ 231,000 of expense was recognized for restricted shares, leaving $ 1,486,000 in unrecognized expense as of March 31, 2024.

Note 6 – Common Stock

Proceeds from sale of common stock totaled $ 638,000 and $ 608,000 for the nine months ended September 30, 2024 and 2023, respectively.

Proceeds from sale of common stock totaled $ 225,000 and $ 204,000 for the three months ended March 31, 2025 and 2024, respectively.

Note 7 – Earnings Per Share

The following table sets forth the computation of basic and diluted EPS for the nine months ended September 30, 2024 and 2023:

Income (Numerator) Shares (Denominator) Per-Share Amount

For the nine months ended September 30, 2024

Net income as reported $ 19,763,000

Income available to common shareholders 19,763,000 11,046,986 $ 1.79

Effect of dilutive securities:

restricted stock 87,102

Income available to common shareholders plus assumed conversions $ 19,763,000 11,134,088 $ 1.78

For the nine months ended September 30, 2023

Net income as reported $ 22,839,000

Income available to common shareholders 22,839,000 10,993,406 $ 2.08

Effect of dilutive securities:

restricted stock 84,089

Income available to common shareholders plus assumed conversions $ 22,839,000 11,077,495 $ 2.06

The following table sets forth the computation of basic and diluted EPS for the quarters ended September 30, 2024 and 2023:

The following table sets forth the computation of basic and diluted EPS for the three months ended March 31, 2025 and 2024:

Income (Numerator) Shares (Denominator) Per-Share Amount

For the quarter ended September 30, 2024

For the three months ended March 31, 2025

Net income as reported $ 7,077,000

3 unchanged sentences

Income available to common shareholders plus assumed conversions $ 7,077,000 11,182,929 $ 0.63

For the quarter ended September 30, 2023

For the three months ended March 31, 2024

Net income as reported $ 6,021,000

7 unchanged sentences

The Plan is a safe harbor plan whereby the Bank also contributes a minimum 3.0 % of annual compensation to the plan for all eligible employees.

The expense related to the 401(k) plan was $ 829,000 and $ 826,000 for the nine months ended September 30, 2024 and 2023, respectively.

The expense related to the 401(k) plan was $ 275,000 and $ 315,000 for the three months ended March 31, 2025 and 2024, respectively.

Deferred Compensation and Supplemental Retirement Benefits

3 unchanged sentences

The costs for these benefits are recognized over the service periods of the participating officers in accordance with FASB ASC Topic 712 "Compensation – Nonretirement Postemployment Benefits".

The expense of these supplemental retirement benefits was $ 137,000 and $ 57,000 for the nine months ended September 30, 2024 and 2023, respectively.

As of September 30, 2024, the associated accrued liability included in other liabilities in the balance sheet was $ 2,586,000 compared to $ 2,664,000 and $ 2,735,000 at December 31, 2023 and September 30, 2023, respectively.

The expense of these supplemental retirement benefits was $ 36,000 and $ 37,000 for the three months ended March 31, 2025 and 2024, respectively.

As of March 31, 2025, the associated accrued liability included in other liabilities in the balance sheet was $ 2,542,000 compared to $ 2,578,000 and $ 2,629,000 at December 31, 2024 and March 31, 2024, respectively.

Postretirement Benefit Plans

6 unchanged sentences

The following table sets forth the accumulated postretirement benefit obligation and funded status:

At or for the nine months ended September 30,

At or for the three months ended March 31,

Change in benefit obligation

7 unchanged sentences

Accrued benefit cost at end of period $ ( 1,183,000 ) $ ( 1,454,000 )

The following table sets forth the net periodic pension cost:

For the nine months ended September 30, For the quarter ended September 30,

2024 2023 2024 2023

Components of net periodic benefit cost

Interest cost $ — $ 14,000 $ — $ 4,000

Net periodic benefit cost $ — $ 14,000 $ — $ 4,000

There was no net periodic pension cost for the three months ended March 31, 2025 and 2024.

Amounts not yet reflected in net periodic benefit cost and included in AOCI are as follows:

September 30, 2024 December 31, 2023 September 30, 2023

March 31, 2025 December 31, 2024 March 31, 2024

Unamortized net actuarial gain $ 363,000 $ 363,000 $ 384,000

8 unchanged sentences

Note 9 - Other Comprehensive Income (Loss)

The following table summarizes activity in the unrealized gain or loss on available for sale securities included in OCI for the nine months and quarters ended September 30, 2024 and 2023.

For the nine months ended September 30, For the quarter ended September 30,

2024 2023 2024 2023

The following table summarizes activity in the unrealized gain or loss on available for sale securities included in OCI for the three months ended March 31, 2025 and 2024.

For the three months ended March 31,

Balance at beginning of period $ ( 42,671,000 ) $ ( 39,575,000 )

Unrealized (losses) gains arising during the period 6,558,000 ( 11,562,000 ) 10,660,000 ( 12,748,000 )

Unrealized gains (losses) arising during the period 5,024,000 ( 4,102,000 )

Related deferred taxes ( 1,055,000 ) 861,000

2 unchanged sentences

The reclassification of realized gains is included in the net securities gains line of the consolidated statements of income and comprehensive income and the tax effect is included in the income tax expense line of the same statement.

The following table summarizes activity in the unrealized loss on securities transferred from available for sale to held to maturity included in OCI for the nine months and quarters ended September 30, 2024 and 2023.

For the nine months ended September 30, For the quarter ended September 30,

2024 2023 2024 2023

The following table summarizes activity in the unrealized loss on securities transferred from available for sale to held to maturity included in OCI for the three months ended March 31, 2025 and 2024.

For the three months ended March 31,

Balance at beginning of period $ ( 47,000 ) $ ( 56,000 )

3 unchanged sentences

Balance at end of period $ ( 45,000 ) $ ( 54,000 )

The following table presents the effect of the Company's derivative financial instruments included in OCI for the nine months and quarters ended September 30, 2024 and 2023.

For the nine months ended September 30, For the quarter ended September 30,

2024 2023 2024 2023

The following table presents the effect of the Company's derivative financial instruments included in OCI for the three months ended March 31, 2025 and 2024.

For the three months ended March 31,

Balance at beginning of period $ 157,000 $ 300,000

Unrealized gains (losses) on cash flow hedging derivatives arising during the period ( 552,000 ) 1,096,000 ( 1,100,000 ) 924,000

Unrealized (losses) gains on cash flow hedging derivatives arising during the period ( 94,000 ) 551,000

Related deferred taxes 19,000 ( 116,000 )

1 unchanged sentence

Balance at end of period $ 82,000 $ 735,000

There was no activity in the unrealized gain or loss on postretirement benefits included in OCI for the nine months and quarters ended September 30, 2024 and 2023.

There was no activity in the unrealized gain or loss on postretirement benefits included in OCI for the three months ended March 31, 2025 and 2024.

Note 10 - Financial Derivative Instruments

The Bank uses derivative financial instruments for risk management purposes and not for trading or speculative purposes.

As part of its overall asset and liability management strategy, the Bank periodically uses derivative instruments to minimize

significant unplanned fluctuations in earnings and cash flows caused by interest rate volatility.

As part of its overall asset and liability management strategy, the Bank periodically uses derivative instruments to minimize significant unplanned fluctuations in earnings and cash flows caused by interest rate volatility.

The Bank’s interest rate risk management strategy involves modifying the re-pricing characteristics of certain assets or liabilities so that changes in interest rates do not have a significant effect on net interest income.

2 unchanged sentences

The Bank formally documents relationships between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking hedge transactions.

The Bank also assesses, both at the hedge’s inception and on an ongoing basis, whether the derivatives used in hedging transactions are highly effective in offsetting the changes in

cash flows or fair values of hedged items.

The Bank also assesses, both at the hedge’s inception and on an ongoing basis, whether the derivatives used in hedging transactions are highly effective in offsetting the changes in cash flows or fair values of hedged items.

Changes in fair value of derivative instruments that are highly effective and qualify as cash flow hedges are recorded in OCI.

2 unchanged sentences

The details of the Bank's swap agreements are as follows:

September 30, 2024 December 31, 2023 September 30, 2023

March 31, 2025 December 31, 2024 March 31, 2024

Effective Date Maturity Date Variable Index Received Fixed Rate Paid Presentation on Consolidated Balance Sheets Notional Amount Fair Value

3 unchanged sentences

04/27/2022 04/27/2024 USD-SOFR-COMPOUND 2.619 % Other Assets — — — — 10,000,000 21,000

04/27/2022 01/27/2024 USD-SOFR-COMPOUND 2.576 % Other Assets — — 10,000,000 22,000 10,000,000 92,000

04/27/2022 04/27/2024 USD-SOFR-COMPOUND 2.619 % Other Assets — — 10,000,000 86,000 10,000,000 159,000

01/10/2023 01/01/2026 USD-SOFR-OIS COMPOUND 3.836 % Other (Liabilities) Assets 75,000,000 ( 172,000 ) 75,000,000 272,000 75,000,000 1,513,000

01/10/2023 01/01/2026 USD-SOFR-OIS COMPOUND 3.836 % Other Assets 75,000,000 104,000 75,000,000 198,000 75,000,000 910,000

$ 75,000,000 $ 104,000 $ 75,000,000 $ 198,000 $ 85,000,000 $ 931,000

Fair Value Hedges

03/08/2023 03/01/2026 USD-SOFR-OIS COMPOUND 4.712 % Other (Liabilities) Assets $ 40,000,000 $ ( 601,000 ) $ 40,000,000 $ ( 581,000 ) $ 40,000,000 $ 63,000

03/08/2023 03/01/2027 USD-SOFR-OIS COMPOUND 4.402 % Other (Liabilities) Assets 30,000,000 ( 710,000 ) 30,000,000 ( 598,000 ) 30,000,000 120,000

03/08/2023 03/01/2028 USD-SOFR-OIS COMPOUND 4.189 % Other (Liabilities) Assets 30,000,000 ( 858,000 ) 30,000,000 ( 678,000 ) 30,000,000 250,000

03/08/2023 03/01/2026 USD-SOFR-OIS COMPOUND 4.712 % Other Liabilities $ 40,000,000 $ ( 256,000 ) $ 40,000,000 $ ( 270,000 ) $ 40,000,000 $ ( 126,000 )

03/08/2023 03/01/2027 USD-SOFR-OIS COMPOUND 4.402 % Other Liabilities 30,000,000 ( 367,000 ) 30,000,000 ( 216,000 ) 30,000,000 ( 132,000 )

03/08/2023 03/01/2028 USD-SOFR-OIS COMPOUND 4.189 % Other Liabilities 30,000,000 ( 431,000 ) 30,000,000 ( 137,000 ) 30,000,000 ( 127,000 )

07/12/2023 08/01/2025 USD-SOFR-OIS COMPOUND 4.703 % Other (Liabilities) Assets 50,000,000 ( 66,000 ) 50,000,000 ( 135,000 ) 50,000,000 72,000

7 unchanged sentences

Such loan level arrangements are not designated as hedges for accounting purposes, and are recorded at fair value in the Company’s consolidated balance sheets.

At September 30, 2024 there were eight customer loan swap arrangements in place.

This compares to seven customer loan swap arrangements in place at December 31, 2023 and six customer loan swap arrangements in place at September 30, 2023.

At March 31, 2025 there were 12 customer loan swap arrangements in place.

This compares to 10 customer loan swap arrangements in place at December 31, 2024 and seven customer loan swap arrangements in place at March 31, 2024.

The details of the Bank's customer loan swap arrangements are detailed below:

September 30, 2024 December 31, 2023 September 30, 2023

March 31, 2025 December 31, 2024 March 31, 2024

Presentation on Consolidated Balance Sheet Number of Positions Notional Amount Fair Value Number of Positions Notional Amount Fair Value Number of Positions Notional Amount Fair Value

9 unchanged sentences

The Bank's arrangement with its institutional counterparty requires it to post cash or other assets as collateral for its various loan swap contracts in a net liability position based on their fair values and the Bank's credit rating or receive cash collateral for contracts in a net asset position as requested.

At September 30, 2024, there was no collateral posted on its swap contracts or required amount to be pledged.

At March 31, 2025, there was no collateral posted on its swap contracts or required amount to be pledged.

Note 11 – Mortgage Servicing Rights

3 unchanged sentences

The model utilizes several assumptions, the most significant of which is loan prepayments, calculated using a three-months moving average of weekly prepayment data published by the PSA and modeled against the serviced loan portfolio, and the discount rate to discount future cash flows.

As of September 30, 2024, the prepayment assumption using the PSA model was 127, which translates into an anticipated prepayment rate of 6.10 %.

As of March 31, 2025, the prepayment assumption using the PSA model was 136, which translates into an anticipated prepayment rate of 6.53 %.

The discount rate is 9.63 %.

2 unchanged sentences

Amortization of mortgage servicing rights, as well as write-offs due to prepayments of the related mortgage loans, are recorded as a charge against mortgage servicing fee income.

For the nine months ended September 30, 2024 and 2023, servicing rights capitalized totaled $ 13,000 and $ 34,000 , respectively.

Servicing rights amortized for the nine-month periods ended September 30, 2024 and 2023 were $ 244,000 and $ 280,000 , respectively.

The fair value of servicing rights was $ 3,074,000 , $ 3,583,000 , and $ 3,673,000 at September 30, 2024, December 31, 2023 and September 30, 2023, respectively.

The Bank serviced loans for others totaling $ 302,430,000 , $ 321,178,000 , and $ 327,428,000 at September 30, 2024, December 31, 2023, and September 30, 2023, respectively.

For the three months ended March 31, 2025 and 2024, servicing rights capitalized totaled $ 13,000 and $ 4,000 , respectively.

Servicing rights amortized for the three-month periods ended March 31, 2025 and 2024 were $ 71,000 and $ 84,000 , respectively.

The fair value of servicing rights was $ 2,973,000 , $ 3,054,000 , and $ 3,423,000 at March 31, 2025, December 31, 2024 and March 31, 2024, respectively.

The Bank serviced loans for others totaling $ 293,503,000 , $ 297,950,000 , and $ 315,414,000 at March 31, 2025, December 31, 2024, and March 31, 2024, respectively.

Mortgage servicing rights are included in other assets and detailed in the following table:

September 30, 2024 December 31, 2023 September 30, 2023

March 31, 2025 December 31, 2024 March 31, 2024

Mortgage servicing rights $ 8,754,000 $ 8,741,000 $ 8,705,000

Accumulated amortization ( 6,919,000 ) ( 6,847,000 ) ( 6,609,000 )

Amortized cost 1,945,000 2,177,000 2,246,000

Impairment reserve ( 5,000 ) — —

Carrying value $ 1,835,000 $ 1,894,000 $ 2,096,000

4 unchanged sentences

Note 13 - Certificates of Deposit

The following table represents the breakdown of certificates of deposit at September 30, 2024 and 2023, and at December 31, 2023:

September 30, 2024 December 31, 2023 September 30, 2023

The following table represents the breakdown of certificates of deposit at March 31, 2025 and 2024, and at December 31, 2024:

March 31, 2025 December 31, 2024 March 31, 2024

Certificates of deposit < $100,000 $ 754,558,000 $ 702,632,000 $ 655,576,000

19 unchanged sentences

The fair value methods and assumptions for the Company's financial instruments and other assets measured at fair value are set forth below.

Investment Securities

The fair values of investment securities are estimated by independent providers using a market approach with observable inputs, including matrix pricing and recent transactions.

Investment Securities The fair values of investment securities are estimated by independent providers using a market approach with observable inputs, including matrix pricing and recent transactions.

In obtaining such valuation information from third parties, the Company has evaluated their valuation methodologies used to develop the fair values in order to determine whether the valuations are representative of an exit price in the Company's principal markets.

33 unchanged sentences

The credit value adjustments associated with derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by the Company and its counterparties.

As of September 30, 2024 and 2023, and December 31, 2023, the Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives due to collateral postings.

As of March 31, 2025 and 2024, and December 31, 2024, the Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives due to collateral postings.

Customer Loan Derivatives

8 unchanged sentences

Changes in assumptions could significantly affect the estimates.

Fair value estimates are based on existing on- and off-balance-sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments.

Fair value estimates are based on existing on- and off-balance-sheet financial instruments without attempting to estimate the value of anticipated future business and the value of

assets and liabilities that are not considered financial instruments.

Other significant assets and liabilities that are not considered financial instruments include the deferred tax asset, premises and equipment, and other real estate owned.

1 unchanged sentence

Assets and Liabilities Recorded at Fair Value on a Recurring Basis

The following tables present the balances of assets and liabilities that were measured at fair value on a recurring basis as of September 30, 2024, December 31, 2023 and September 30, 2023.

At September 30, 2024

The following tables present the balances of assets and liabilities that were measured at fair value on a recurring basis as of March 31, 2025, December 31, 2024 and March 31, 2024.

At March 31, 2025

Level 1 Level 2 Level 3 Total

5 unchanged sentences

Total securities available for sale — 280,764,000 — 280,764,000

Interest rate swap agreements — 104,000 — 104,000

Customer loan interest swap agreements — 4,504,000 — 4,504,000

1 unchanged sentence

Total assets $ — $ 285,372,000 $ — $ 285,372,000

At September 30, 2024

At March 31, 2025

Level 1 Level 2 Level 3 Total

19 unchanged sentences

Total liabilities $ — $ 5,617,000 $ — $ 5,617,000

At September 30, 2023

At March 31, 2024

Level 1 Level 2 Level 3 Total

9 unchanged sentences

Total assets $ — $ 280,232,000 $ — $ 280,232,000

At September 30, 2023

At March 31, 2024

Level 1 Level 2 Level 3 Total

Interest rate swap agreements $ — $ 385,000 $ — $ 385,000

Customer loan interest swap agreements — 4,778,000 — 4,778,000

2 unchanged sentences

The following tables include assets measured at fair value on a nonrecurring basis that have had a fair value adjustment since their initial recognition.

Mortgage servicing rights are presented at fair value with a $ 5,000 impairment reserve at September 30, 2024.

There was no impairment reserve at December 31, 2023 and September 30, 2023.

OREO is presented net of an allowance of $ 35,000 at September 30, 2024.

There was no OREO or related allowance at December 31, 2023 and September 30, 2023.

Mortgage servicing rights are presented at fair value with no impairment reserve for each of the periods presented.

There was no OREO or related allowance at March 31, 2025 and 2024 .

OREO is presented net of an allowance of $ 35,000 at December 31, 2024.

Only collateral-dependent IAL with a related specific ACL or a partial charge off are included in IAL for purposes of fair value disclosures.

There were no collateral-dependent IAL with a related specific ACL or a partial charge off at September 30, 2024.

IAL below are presented net of specific allowances of $ 19,000 at December 31, 2023, and September 30, 2023.

At September 30, 2024

IAL below are presented net of specific allowances of $ 1,029,000 and $ 821,000 at March 31, 2025 and December 31, 2024, respectively.

There were no collateral-dependent IAL with a related specific ACL or a partial charge off at March 31, 2024.

At March 31, 2025

Level 1 Level 2 Level 3 Total

Mortgage servicing rights $ — $ 2,973,000 $ — $ 2,973,000

OREO — 173,000 — 173,000

Individually analyzed loans — 318,000 — 318,000

Total assets $ — $ 3,291,000 $ — $ 3,291,000

2 unchanged sentences

Mortgage servicing rights $ — $ 3,054,000 $ — $ 3,054,000

Other real estate owned — 173,000 — 173,000

Individually analyzed loans — 538,000 — 538,000

Total assets $ — $ 3,765,000 $ — $ 3,765,000

At September 30, 2023

At March 31, 2024

Level 1 Level 2 Level 3 Total

Mortgage servicing rights $ — $ 3,423,000 $ — $ 3,423,000

Individually analyzed loans — 285,000 — 285,000

Total assets $ — $ 3,423,000 $ — $ 3,423,000

12 unchanged sentences

Carrying value is used because the accounts have no stated maturity and the customer has the ability to withdraw funds immediately.

The carrying amount and estimated fair values for financial instruments as of September 30, 2024 were as follows:

The carrying amount and estimated fair values for financial instruments as of March 31, 2025 were as follows:

Carrying value Estimated fair value Level 1 Level 2 Level 3

41 unchanged sentences

Total borrowed funds 146,278,000 146,247,000 — 146,247,000 —

The carrying amount and estimated fair values for financial instruments as of September 30, 2023 were as follows:

The carrying amount and estimated fair values for financial instruments as of March 31, 2024 were as follows:

Carrying value Estimated fair value Level 1 Level 2 Level 3

20 unchanged sentences

Note 16 – Impact of Recently Issued Accounting Standards

In March 2023, the FASB issued ASU No.

2023-02, Investments - Equity Method and Joint Ventures (Topic 323):

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

This ASU expands the use of proportional amortization method of accounting — currently allowed only for investments in low-income housing tax credit (LIHTC) structures — to equity investments in other tax credit structures that meet certain criteria.

The proportional amortization method results in (1) the tax credit investment being amortized in proportion to the allocation of tax credits and other tax benefits in each period and (2) net presentation within the income tax line item.

The ASU is effective beginning in 2024 for calendar year-end public business entities.

Adoption of this ASU did not have a material impact on the Company's consolidated financial statements.

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

2 unchanged sentences

Adoption is required for annual periods beginning after December 15, 2024 and is not expected to have a material impact on the Company's consolidated financial statements.

In November 2024 the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses (ASU 2024-03).

Under ASU 2024-03, public business entities, such as the Company, are required to disclose in the notes to their financial statements disaggregated information about certain costs and expenses in both annual and interim filings.

ASU 2024-03 is effective for calendar year-end public business entities beginning in calendar year 2027, and is not expected to have a material impact on the Company's consolidated financial statements.

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