First Seacoast Bancorp, Inc. 10-K

ITEM 5. Market for Registrant’s Common Equity, Related Stoc kholder Matters and Issuer Purchases of Equity Securities. The Company's common stock has been listed on The Nasdaq Capital Market under the symbol “FSEA” since January 20, 2023. As of March 18, 2026, we had 295 stockholders of record (excluding the number of persons or entities holding stock in street name through various brokerage firms), and 4,694,149 shares of common stock outstanding. The payment of dividends by the Company and amount of any dividend payments is subject to statutory and regulatory limitations, and depends upon a number of factors, including the following: regulatory capital requirements; our financial condition and results of operations; our other uses of funds for the long-term value of stockholders; tax considerations; and general economic conditions. The Federal Reserve Board has issued a policy statement providing that dividends should be paid only out of current earnings and only if our prospective rate of earnings retention is consistent with our capital needs, asset quality and overall financial condition. Regulatory guidance also provides for prior regulatory consultation with respect to capital distributions in certain circumstances such as where the holding company’s net income for the past four quarters, net of dividends previously paid over that period, is insufficient to fully fund the dividend or the holding company’s overall rate or earnings retention is inconsistent with its capital needs and overall financial condition. In addition, First Seacoast Bank's ability to pay dividends will be limited if it does not have the capital conservation buffer required by the new capital rules, which may limit our ability to pay dividends to stockholders. No assurances can be given that any dividends will be paid or that, if paid, will not be reduced or eliminated in the future. Special cash dividends, stock dividends or returns of capital, to the extent permitted by regulations and policies of the Federal Reserve Board and the Federal Deposit Insurance Corporation, may be paid in addition to, or in lieu of, regular cash dividends. On April 11, 2024, the board of directors of the Company authorized a stock repurchase program for the repurchase of up to 507,707 shares of common stock, representing approximately 10% of shares then outstanding, which became effective on May 14, 2024. On December 12, 2024, the board of directors of the Company authorized additional stock repurchases, up to 228,858 shares of common stock, under this stock repurchase program. The additional repurchase authorization represents approximately 5% of pro forma outstanding shares assuming the repurchase of the remaining shares subject to the original authorization. The Company conducts repurchases through open market purchases, including by means of a trading plan adopted under SEC Rule 10b5-1, or in privately negotiated transactions, subject to market conditions and other factors. There is no guarantee as to the number of shares that the Company may ultimately repurchase. The program will expire 12 months after the effective date, regardless of whether all shares will have been repurchased. On February 7, 2025, the expiration date of the program was extended to December 3, 2025. On September 19, 2025, the expiration date of the program was extended to June 3, 2026. The Company may suspend or discontinue the program at any time. The Company holds repurchased shares in its treasury. As of December 31, 2025, the Company has repurchased 494,379 shares under this stock repurchase program. The following table summarizes the Company’s repurchases of its outstanding shares of common stock during the quarter ended December 31, 2025: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs October 1, 2025 - October 31, 2025 1,310 $ 11.50 1,310 244,552 November 1, 2025 - November 30, 2025 2,266 11.72 2,266 242,286 December 1, 2025 - December 31, 2025 100 11.77 100 242,186 Total 3,676 3,676 There were no sales of unregistered securities during the year ended December 31, 2025. ITEM 6. [Reserved] IT EM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations This discussion and analysis reflects our consolidated financial statements and other relevant statistical data and is intended to enhance your understanding of our financial condition and results of operations. The information in this section has been derived from the consolidated financial statements which appear elsewhere in this annual report. Certain prior year amounts have been reclassified to conform to the current year presentation. You should read the information in this section in conjunction with the other business and financial information provided in this annual report. 30 Overview Our business consists primarily of taking deposits from the general public and investing those deposits, together with funds generated from operations and borrowings from the Federal Home Loan Bank, in one- to four-family residential real estate loans, commercial real estate and multi-family real estate loans, acquisition, development and land loans, commercial and industrial loans, home equity loans and lines of credit and consumer loans. In recent years, we have increased our focus, consistent with what we believe to be conservative underwriting standards, on originating higher yielding commercial real estate and commercial and industrial loans. We conduct our operations from four full-service banking offices in Strafford County, New Hampshire and one full-service banking office in Rockingham County, New Hampshire. We consider our primary lending market area to be Strafford and Rockingham Counties in New Hampshire and York County in southern Maine. Selected Financial Data The following tables set forth selected historical financial and other data for the Company at the dates and for the periods indicated. The following information is only a summary and should be read in conjunction with our consolidated financial statements and the notes thereto of this annual report. The information at and for the years ended December 31, 2025 and 2024 is derived in part from the audited consolidated financial statements included in this annual report. The information at and for the year ended December 31, 2023 is derived in part from audited consolidated financial statements that are not included in this annual report. At or For the Year Ended December 31, 2025 2024 2023 (In thousands, except per share data) Selected Financial Condition Data: Total assets $ 599,295 $ 580,780 $ 571,035 Total loans 419,474 438,967 430,031 Total deposits 470,773 454,208 404,798 Total borrowings 52,308 52,268 93,007 Total stockholders' equity 63,547 62,050 66,618 Book value per share $ 13.54 $ 12.97 $ 13.12 Selected Operating Data: Interest and dividend income $ 26,986 $ 25,431 $ 20,590 Interest expense 13,299 13,533 9,080 Net interest and dividend income 13,687 11,898 11,510 (Release) provision for credit losses (1 ) (72 ) 188 Net interest and dividend income after (release) provision for credit losses 13,688 11,970 11,322 Non-interest income (loss) 1,753 3,904 (2,007 ) Non-interest expense 16,924 15,860 16,027 (Loss) income before income tax (benefit) expense (1,483 ) 14 (6,712 ) Income tax (benefit) expense (638 ) 527 3,944 Net loss $ (845 ) $ (513 ) $ (10,656 ) Share Data: Average shares outstanding, basic 3,676,427 4,335,154 4,650,916 Average shares outstanding, diluted 3,676,427 4,335,154 4,650,916 Total shares outstanding 4,694,149 4,785,569 5,077,164 Basic loss per share $ (0.23 ) $ (0.12 ) $ (2.29 ) Diluted loss per share $ (0.23 ) $ (0.12 ) $ (2.29 ) 31 At or For the Year Ended December 31, 2025 2024 2023 Performance Ratios: Return on average assets (1) (0.14 )% (0.09 )% (1.93 )% Return on average equity (2) (1.37 )% (0.79 )% (15.10 )% Interest rate spread (3) 1.72 % 1.42 % 1.59 % Net interest margin (4) 2.33 % 2.09 % 2.16 % Non-interest expenses as a percent of average assets 2.81 % 2.72 % 2.91 % Efficiency ratio (5) 109.61 % 100.37 % 168.65 % Average interest-earning assets as a percent of average interest-bearing liabilities 126.99 % 127.98 % 133.23 % Average equity as a percent of average assets (6) 10.25 % 11.12 % 12.81 % Capital Ratios (First Seacoast Bank Only): Total Capital (to risk-weighted assets) 15.60 % 15.55 % 15.32 % Tier 1 Capital (to risk-weighted assets) 14.56 % 14.52 % 14.27 % Common Equity Tier 1 (to risk-weighted assets) 14.56 % 14.52 % 14.27 % Tier 1 Capital (to average assets) 8.41 % 8.69 % 9.19 % Asset Quality Ratios: Allowance for credit losses on loans as a percent of total loans 0.82 % 0.79 % 0.79 % Allowance for credit losses on loans as a percent of non-performing loans 716.95 % — 2,404.26 % Net charge-offs as a percent of average outstanding loans during the year — 0.01 % — Non-performing loans as a percent of total loans 0.11 % — 0.03 % Non-performing loans as a percent of total assets 0.08 % — 0.02 % Non-performing assets as a percent of total assets 0.08 % — 0.02 % Other Data: Number of offices 5 5 5 Number of full-time equivalent employees 72 75 76 (1) Represents net loss divided by average total assets. (2) Represents net loss divided by average equity. (3) Represents the difference between the weighted average yield on average interest-earning assets and the weighted average cost of average interest-bearing liabilities. (4) Represents net interest income divided by average interest-earning assets. (5) Represents non-interest expense divided by the sum of net interest and dividend income and non-interest income. (6) Represents average equity divided by average total assets. Business Strategy We believe we enjoy a strong, positive reputation among our customers and in our market area. We believe our name change to “First Seacoast Bank” in 2019 enhanced our brand and market visibility and associates us by name with the market area and communities we serve. As a community-oriented financial institution, we focus on serving the financial needs of local individuals and businesses by executing a safe and sound, service-oriented business strategy that seeks to produce earnings that increase over time and can be reinvested in our business and communities. Our current business strategy consists of the following: • Grow our balance sheet, leverage existing infrastructure and improve profitability and operating efficiency. Given our existing infrastructure and capabilities, we believe we are well-positioned to grow without a proportional increase in overhead expense or operating risk. In recent years, we have assembled an experienced management team and selectively hired lending, business development and support staff. Our operations benefit from established marketing, information technology and audit and compliance departments. Additionally, we have invested in Internet banking capabilities and a mobile banking application. • Grow our loan portfolio and increase commercial real estate and commercial and industrial lending. Historically, our principal business activity has been the origination of one- to four-family residential mortgage 32 loans. In recent years, we have sought to supplement these originations by focusing on originating higher yielding commercial real estate loans (including owner-occupied and non-owner-occupied commercial real estate and multi-family real estate loans), construction loans, commercial and industrial loans and home equity loans and lines of credit. We intend to remain as a residential mortgage lender in our market area while continuing to increase our focus on originating commercial real estate and commercial and industrial loans. Our increased legal lending limit has enabled us to originate larger loans for our portfolio to new and existing customers and reduced our need to participate with other lenders to originate larger loans. • Maintain strong asset quality and manage credit risk. Strong asset quality is key to the long-term financial success of any financial institution. We have been successful in maintaining strong asset quality in recent years. Our ratio of non-performing assets as a percent of total assets was 0.08%, 0.00% and 0.02%, at December 31, 2025, 2024 and 2023, respectively. We attribute this historical credit quality to a conservative credit culture and an effective credit risk management environment. We have an experienced team of credit professionals, well-defined and implemented credit policies and procedures, what we believe to be conservative loan underwriting criteria and active credit monitoring policies and procedures. • Increase core deposits and reduce reliance on higher cost borrowings. Deposits are our primary source of funds for lending and investment. Core deposits (which we define as all deposits except for time deposits), particularly non-interest-bearing demand deposits, represent a low-cost, stable source of funds. Core deposits were 67.7% of our total deposits at December 31, 2025. We also rely on higher cost Federal Home Loan Bank and Federal Reserve Bank borrowings as supplemental funding sources. At December 31, 2025, our ratio of net loans to deposits was 88.4% and our borrowings from these supplemental funding sources totaled $52.3 million. We continue to focus on expanding core deposits by leveraging our business development officers and commercial lending and retail relationships. • Grow organically and through opportunistic acquisitions or de novo branching. Our primary intention is to grow our balance sheet organically and use our capital to increase our lending and investment capacity. As a local independent bank, we believe we will have opportunities to gain market share from customer fallout resulting from the consolidation of competing financial institutions in our market area into larger, out-of-market acquirers. In addition to organic growth, we may also consider expansion opportunities in our market area or in contiguous markets that we believe would enhance both our franchise value and stockholder returns. These opportunities include establishing loan production offices, establishing new, or de novo, branch offices and/or acquiring branch offices. We have no current plans or intentions regarding any such expansion plans. These strategies are unchanged from disclosed business strategies in previous annual reports. We intend to continue to pursue these business strategies, subject to changes necessitated by future market conditions, regulatory restrictions and other factors. While we are committed to the business strategies noted above, we recognize the challenges and uncertainties of the current environment and plan to execute these strategies as market conditions allow. Critical Accounting Policies and Critical Accounting Estimates The discussion and analysis of the financial condition and results of operations are based on our consolidated financial statements, which are prepared in conformity with generally accepted accounting principles used in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions affecting the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of income and expenses. We believe the calculation of the ACL and the measurement of the fair value of financial instruments are both important to the presentation of our consolidated financial condition and results of operations and require subjective or complex judgments and, therefore, we consider the accounting policies and estimates discussed below to be critical. The estimates and assumptions that we use are based on historical experience and various other factors and are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions, resulting in a change that could have a material impact on the carrying value of our assets and liabilities and our results of operations. The estimation of the ACL is in accordance with the ASC 326 methodology utilizing the WARM modeling approach as performed in a third-party software application. The adequacy of the ACL is evaluated on a quarterly basis by management. This assessment includes procedures to estimate the ACL and test the adequacy and appropriateness of the resulting balance. The level of the ACL is based upon management's evaluation of historical default and loss experience, current and projected economic conditions, asset quality trends, known and inherent risks in the portfolio, adverse situations that may affect the borrowers' ability to repay a loan (including the timing of future payments), the estimated value of any underlying collateral, composition of the loan portfolio, industry and peer bank loan quality indications and other pertinent factors, including regulatory recommendations. The level of the ACL maintained by management is believed adequate to absorb all expected future losses inherent in the loan portfolio at the balance sheet date. The ACL is increased through provision for credit losses on loans and decreased by charge-offs, net of recoveries of amounts previously charged-off. 33 The ACL is measured on a collective basis for pools of loans with similar risk characteristics. Management has identified the following pools of financial assets with similar risk characteristics for measuring expected credit losses: • Owner occupied commercial real estate mortgage loans - Owner occupied commercial real estate mortgage loans are secured by commercial office buildings, industrial buildings, warehouses or retail buildings where the owner of the building occupies the property. For such loans, repayment is largely dependent upon the operation of the borrower's business. • Non-owner occupied commercial real estate and multi-family real estate loans - These loans represent investment real estate loans secured by office buildings, industrial buildings, warehouses, retail buildings, and multi-family residential housing. Repayment is primarily dependent on lease income generated from the underlying collateral. • Consumer real estate mortgage loans - Consumer real estate mortgage consists primarily of loans secured by one- to four-family residential properties, including home equity loans and lines of credit. Repayment is primarily dependent on the personal cash flow of the borrower. • Acquisition, Development and land loans – Acquisition, development and land loans include loans where the repayment is dependent on the successful completion and eventual sale, refinance or operation of the related real estate project. Acquisition, development and land loans include one- to four-family construction projects and commercial construction or rehabilitation endeavors such as warehouses, apartments, office and retail space and land acquisition and development. • Commercial and industrial loans - Commercial and industrial loans include loans to business enterprises issued for commercial, industrial and/or other professional purposes. These loans are generally secured by equipment, inventory, and accounts receivable of the borrower and repayment is primarily dependent on business cash flows. • Consumer and other loans - Consumer and other loans include all loans issued to individuals, primarily pre-existing First Seacoast Bank customers, not included in the consumer real estate mortgage classification and purchased loans secured by manufactured housing properties. Examples of consumer and other loans are automobile loans and other installment loans extended directly to the borrower. Consumer loans may be unsecured. Repayment is primarily dependent on the personal cash flow of the borrower. The WARM method uses an approach that begins with a quarterly loss rate and applies that rate to the loan pools of financial assets with similar risk characteristics noted above on a periodic basis over time for the remaining life expectation of each loan pool. Due to the Company’s limited loss experience, management has chosen to use peer group loss data in the calculation of the quarterly loss rate. A peer group was selected within the third-party software application which includes all banks between $300 million and $1 billion in asset size located in the northeastern United States. The historical loss component segmented by loan pool serves as the core of the ACL adequacy methodology. The remaining life calculation for each pool is calculated by the third-party software application using an attrition calculator that performs quarterly cohort-based attrition measurements using the actual historical experience of each loan pool. The estimated credit losses for all loan pools are adjusted for changes in qualitative factors not inherently considered in the quantitative analyses. The qualitative categories and the measurements used to quantify the risks within each of these categories are subjectively selected by management but measured by objective measurements period over period. The data for each measurement may be obtained from internal or external sources. The current period measurements are evaluated and assigned a factor commensurate with the current level of risk relative to past measurements over time. The resulting qualitative adjustments are applied to the relevant collectively evaluated loan portfolios. These adjustments are based upon quarterly trend assessments in portfolio concentrations, policy exceptions, associate retention, independent loan review results, competition and peer group credit quality trends. The qualitative allowance allocation, as determined by the processes noted above, is increased or decreased for each loan segment based on the assessment of these various qualitative factors. Additional qualitative considerations are made for any identified risk which did not exist within our portfolio historically and therefore may not be adequately addressed through evaluation of such risk factor based on historical portfolio trends as previously discussed. Our ACL as a percent of total loans was 0.82% at December 31, 2025 and 0.79% at December 31, 2024, which primarily reflects the impact of calculated loss rates based upon remaining life measurements and our consideration of the current economic conditions that affect the qualitative adjustments used in the determination of the ACL as they have evolved over the year from the impact of inflationary pressures and geopolitical concerns, among other considerations. While we consider a number of variables in our evaluation of the adequacy of the ACL, one of the more significant variables is the use of a reasonable and supportable forecast period in the calculation of a historical loss rate. As noted above, the Company has chosen a forecast period of one year which will be similar to the historical loss period between January 2014 and December 2016 and then reverting to the long-term average over the following two quarters using the straight-line reversion method. This time period was one of relatively stagnant expansion in the U.S. with GDP growth rates in the 1.6% - 2.6% range. Economic indicators during this period were mixed and appear similar to the current economy. Additionally, because 34 historical loss experience may not fully reflect our expectations about the future, management has adjusted the historical loss rate through a qualitative adjustment to reflect current economic conditions not already reflected in the historical loss information. If a pre-recessionary period such as the period between March 2007 and September 2009 was chosen as the reasonable and supportable forecast period with a similar qualitative adjustment consideration, the ACL would decrease by $300,000 to $3.2 million. Alternatively, if the qualitative adjustment to reflect current economic conditions not already reflected in the historical loss information were removed from the chosen forecast period used in the calculation of the ACL, the ACL would decrease by $1.4 million to $2.0 million. While policies and procedures used to estimate the ACL, as well as the resultant provision for credit losses charged to (loss) income, are considered adequate by management and are reviewed periodically by regulators, model validators and internal auditors, they are necessarily approximate and imprecise. There are factors beyond our control, such as changes in projected economic conditions, real estate markets or particular industry conditions which may materially impact asset quality and the adequacy of the ACL and thus the resulting provision for credit losses. Therefore, management considers the calculation of the ACL a critical accounting estimate. The Company's measurement of the fair value of its financial instruments is subject to uncertainty primarily due to the lack of quoted market prices for a portion of its various assets and liabilities. Fair values, where quoted market prices are not available, are based on estimates using the present value of cash flows or other valuation techniques. These techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument. Certain of the Company's financial assets are measured at fair value on a recurring or non-recurring basis. The Company's primary financial asset measured at fair value on a recurring basis is its securities available-for-sale. For these securities, we obtain fair value measurements from independent pricing services which consider observable data that may include reported trades, dealer quotes, the instrument’s terms and conditions, as well as other market data. These fair value measurements are significantly impacted by changes in market interest rates and current economic conditions as compared to the coupon rates for the financial assets. We obtain a monthly market rate volatility report to confirm that the overall price volatility of the portfolio is within prescribed policy limits. Fair value of the Company’s mortgage servicing rights is also measured on a recurring basis based upon a valuation model that calculates the present value of estimated future net servicing income. We rely on an independent valuation from a third party which uses a discounted cash flow model to estimate the fair value of our mortgage servicing rights. The valuation model utilizes interest rate, prepayment speed and default rate assumptions that market participants would use in estimating future income and that can be validated against available market data. These assumptions are inherently sensitive to change as these unobservable inputs are not based upon quoted prices in active markets or otherwise observable. We periodically review the assumptions underlying the valuation of our mortgage servicing rights. While we believe the values produced by the discounted cash flow model are indicative of the fair value of our mortgage servicing rights portfolio, these values can change significantly depending upon factors such as the then current interest rate environment, estimated prepayments speeds of the underlying mortgage loans being serviced, and other economic conditions. Fair value of the Company’s derivatives is measured on a recurring basis using the discounted cash flow method on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. These fair value measurements are significantly impacted by changes in market interest rates and current economic conditions as compared to the coupon rates for the derivatives. We obtain a monthly interest rate volatility report to monitor the volatility of our derivatives portfolio. At December 31, 2025 and 2024, there were no financial assets or liabilities measured at fair value on a non-recurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances. This may include certain individually evaluated loans reported at the fair value of the underlying collateral. The Company has no non-financial assets or non-financial liabilities measured at fair value on a recurring or non-recurring basis. ASC 820 - "Fair Value Measurement (Topic 820)" also requires disclosure of the fair value of financial assets and financial liabilities that are not measured and reported at fair value on a recurring or non-recurring basis. ASC 820 requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes. The exit price notion is a market-based measurement of fair value that is represented by the price to sell an asset or transfer a liability in the principal market (or most advantageous market in the absence of a principal market) on the measurement date. At December 31, 2025 and 2024, fair values of loans are estimated on an exit price basis incorporating discounts for credit, liquidity and marketability factors. At December 31, 2025 and 2024, these factors have not materially impacted the estimated fair values of loans as compared to their carrying amounts. 35 Comparison of Financial Condition at December 31, 2025 and December 31, 2024 Total Assets. Total assets were $599.3 million as of December 31, 2025, an increase of $18.5 million, or 3.2%, when compared to total assets of $580.8 million at December 31, 2024. The increase was due primarily to increases in securities available-for-sale and cash and due from banks offset by a decrease in net loans. Cash and Due From Banks. Cash and due from banks increased $6.3 million, or 88.9%, to $13.4 million at December 31, 2025 from $7.1 million at December 31, 2024. The increase was due primarily to a $16.6 million increase in total deposits and a $19.4 million decrease in net loans offset by $29.6 million of net purchases of securities available-for-sale during the year ended December 31, 2025. Available-for-Sale Securities. Available-for-sale securities increased by $32.2 million, or 26.8%, to $152.4 million at December 31, 2025 from $120.2 million at December 31, 2024. This increase was due to investment purchases totaling $50.7 million and a $3.0 million decrease in net unrealized losses within the portfolio offset by $21.1 million of proceeds from maturities and principal payments received on securities available-for-sale and $387,000 of net amortization of bond premiums. The unrealized losses within the portfolio are due to noncredit-related factors, including changes in market interest rates and other market conditions, and therefore we recorded no allowance for credit losses on available-for-sale debt securities as of December 31, 2025. The following table sets forth the amortized cost and average yield of our debt securities, by type and contractual maturity: Maturity as of December 31, 2025 One Year or Less After One Year but within Five Years After Five Years but within Ten Years After Ten Years Total Amortized Cost Average Yield Amortized Cost Average Yield Amortized Cost Average Yield Amortized Cost Average Yield Amortized Cost Average Yield (Dollars in thousands) U.S. Government sponsored enterprises obligations $ — — $ 1,615 1.21 % $ — — $ — — $ 1,615 1.21 % U.S. Government agency small business administration pools guaranteed by SBA — — — — 3,867 5.14 % 7,405 4.41 % 11,272 4.66 % Collateralized mortgage obligations issued by the FHLMC, FNMA and GNMA — — — — 1,750 3.34 % 33,015 5.62 % 34,765 5.50 % Residential mortgage-backed securities — — 653 3.47 % — — 66,072 4.48 % 66,725 4.47 % Municipal bonds — — — — 1,599 2.84 % 30,955 2.53 % 32,554 2.54 % Corporate debt 5,690 3.98 % 500 7.00 % — — — — 6,190 4.22 % Corporate subordinated debt — — 1,932 10.08 % 3,934 4.49 % — — 5,866 6.33 % 5,690 3.98 % $ 4,700 5.78 % $ 11,150 4.30 % $ 137,447 3.30 % $ 158,987 4.34 % Net Loans. Net loans decreased $19.4 million, or 4.5%, to $416.0 million at December 31, 2025 from $435.5 million at December 31, 2024. During the year ended December 31, 2025, we collected $25.3 million of loan principal, net of new loan originations, and purchased $3.6 million of participation interests in commercial and industrial loans and $1.9 million of consumer loans secured by manufactured housing properties. As of December 31, 2025 and 2024, the portfolios of purchased loans had outstanding principal balances of $37.0 million and $34.3 million, respectively, and were performing in accordance with their original repayment terms. Net deferred loan costs increased $124,000, or 4.5%, to $2.9 million at December 31, 2025 from $2.8 million at December 31, 2024 due primarily to the increase in deferred costs on consumer loans offset by a decrease in deferred costs on one- to four-family residential mortgage loans. Our ACL on loans decreased $59,000 to $3.4 million at December 31, 2025 from $3.5 million at December 31, 2024 and consisted of a $60,000 release of credit losses on loans offset by $1,000 of consumer loan recoveries. 36 One- to four-family residential mortgage loans decreased $10.0 million, or 3.6%, to $265.2 million at December 31, 2025 from $275.2 million at December 31, 2024. Commercial real estate mortgage loans decreased $5.4 million, or 6.3%, to $80.6 million at December 31, 2025 from $86.0 million at December 31, 2024. Acquisition, development and land loans decreased $2.1 million, or 13.9%, to $12.9 million at December 31, 2025 from $14.9 million at December 31, 2024. Commercial and industrial loans decreased $1.2 million, or 4.9%, to $22.5 million at December 31, 2025 from $23.7 million at December 31, 2024. Home equity loans and lines of credit decreased $256,000, or 1.2%, to $20.7 million at December 31, 2025 from $20.9 million at December 31, 2024. Multi-family real estate loans decreased $913,000, or 15.9%, to $4.8 million at December 31, 2025 from $5.8 million at December 31, 2024. Consumer loans increased $335,000, or 2.7%, to $12.7 million at December 31, 2025 from $12.4 million at December 31, 2024. Our strategy to grow the balance sheet continues to be through originations of one- to four-family residential mortgage loans, while also diversifying into higher yielding commercial and multi-family real estate loans and commercial and industrial loans to improve net margins and manage interest rate risk. We also continue to consider selling selected, conforming 15-year and 30-year fixed rate mortgage loans to the secondary market on a servicing retained basis as market conditions allow, providing us a recurring source of revenue from loan servicing income and gains on the sale of such loans. Deposits. Our deposits are generated primarily from residents within our primary market area. We offer a selection of deposit accounts, including non-interest-bearing and interest-bearing checking accounts, savings accounts, money market accounts and time deposits, for both individuals and businesses. Deposits increased $16.6 million, or 3.7%, to $470.8 million at December 31, 2025 from $454.2 million at December 31, 2024 due primarily to an increase in time deposits. Core deposits (defined as all deposits other than time deposits) increased $361,000, or 0.1%, to $318.8 million at December 31, 2025 from $318.5 million at December 31, 2024. The increase in core deposits was due to a $7.5 million, or 4.6%, increase in NOW and demand deposits offset by a decrease in savings deposits of $1.9 million, or 2.2%, and a decrease in money market deposits of $5.3 million, or 7.4%. Time deposits increased $16.2 million, or 11.9%, to $151.9 million at December 31, 2025 from $135.7 million at December 31, 2024. At December 31, 2025 and 2024, there were $69.1 million and $63.1 million of brokered deposits included in time deposits, respectively, and $21.9 million and $22.1 million of brokered deposits included in savings deposits, respectively. The purchase of brokered deposits offered a lower cost alternative to advances of similar duration from the Federal Home Loan Bank. Borrowings. Total borrowings were $52.3 million at December 31, 2025 and 2024. Total Stockholders’ Equity. Total stockholders’ equity increased $1.5 million, or 2.4%, to $63.5 million at December 31, 2025 from $62.1 million at December 31, 2024. This increase was due primarily to $2.2 million of other comprehensive income related primarily to net changes in unrealized holding losses in the available-for-sale securities portfolio as a result of decreases in market interest rates during the year ended December 31, 2025 and the recognition of $1.1 million of stock-based compensation offset by a net loss of $845,000 for the year ended December 31, 2025 and $981,000 of common stock repurchases. Non-performing Assets. Non-performing assets include loans that are 90 or more days past due or on non-accrual status and real estate and other loan collateral acquired through foreclosure and repossession. Management determines that a loan is non-performing when it is probable that at least a portion of the loan will not be collected in accordance with the original terms due to a deterioration in the financial condition of the borrower or the value of the underlying collateral if the loan is collateral dependent. When a loan is determined to be non-performing, the measurement of the loan in the ACL on loans is based on present value of expected future cash flows, except that all collateral-dependent loans are measured for non-performance based on the fair value of the collateral. Non-accrual loans are loans for which collectability is questionable and, therefore, interest on such loans will no longer be recognized on an accrual basis. We generally cease accruing interest on our loans when contractual payments of principal or interest have become 90 days past due or when management has serious doubts about further collectability of principal or interest, even though the loan is currently performing. Interest received on non-accrual loans generally is applied against principal or applied to interest on a cash basis. Generally, loans are restored to accrual status when the obligation is brought current, has performed in accordance with the contractual terms for at least six consecutive months and the ultimate collectability of the total contractual principal and interest is no longer in doubt. 37 Non-performing loans were $478,000, or 0.11% of total loans, at December 31, 2025, compared to $-0- at December 31, 2024. As noted above in our lending activities discussion, at December 31, 2025, non-performing loans consist of two residential mortgage loans and a consumer loan secured by a manufactured housing property. One non-performing residential mortgage loan with an outstanding balance of $297,000 was destroyed by a fire. Our outstanding residential mortgage loan balance is expected to be paid with insurance proceeds. Another non-performing residential mortgage loan with an outstanding balance of $64,000 and an estimated market value of $100,000 became current after year end and is expected to return to accrual status once the loan has performed in accordance with the contractual terms for a reasonable period of time and the ultimate collectability of the total contractual principal and interest is no longer in doubt. The non-performing consumer loan secured by a manufactured housing property with an outstanding balance of $117,000 and an estimated market value of $140,000 is with a deceased borrower. The property is expected to be sold and the outstanding balance paid. At December 31, 2025 and 2024, we had no foreclosed assets. Comparison of Operating Results for the Years Ended December 31, 2025 and 2024 Net Loss. Net loss was $845,000 for the year ended December 31, 2025, compared to a net loss of $513,000 for the year ended December 31, 2024, an increase of $332,000. The increase was due primarily to a decrease in non-interest income of $2.2 million and a $1.1 million increase in non-interest expenses, offset by a $1.8 million increase in net interest and dividend income and a $1.2 million decrease in income tax expense during the year ended December 31, 2025 compared to the year ended December 31, 2024. Interest and Dividend Income. Interest and dividend income increased $1.6 million, or 6.1%, to $27.0 million for the year ended December 31, 2025 from $25.4 million for the year ended December 31, 2024. This increase was due to a $583,000, or 3.0%, increase in interest and fees on loans and a $972,000, or 16.8%, increase in interest and dividend income on investments. Average interest-earning assets increased $16.5 million, or 2.9%, to $586.3 million for the year ended December 31, 2025 from $569.8 million for the year ended December 31, 2024. The weighted average yield on interest-earning assets increased 14 basis points to 4.60% for the year ended December 31, 2025 from 4.46% for the year ended December 31, 2024. The weighted average yield for the loan portfolio increased 14 basis points to 4.67% for the year ended December 31, 2025 from 4.53% for the year ended December 31, 2024 due primarily to an increase in market interest rates. The weighted average yield for all other interest-earning assets increased to 4.42% for the year ended December 31, 2025 from 4.25% for the year ended December 31, 2024 due primarily to an increase in market interest rates. Interest Expense. Total interest expense decreased $234,000, or 1.7%, to $13.3 million for the year ended December 31, 2025 from $13.5 million for the year ended December 31, 2024. Interest expense on deposits increased $1.1 million, or 10.9%, for the year ended December 31, 2025 compared to the year ended December 31, 2024. The average balance of interest-bearing deposits increased $42.6 million, or 11.8%, to $404.2 million for the year ended December 31, 2025 from $361.6 million for the year ended December 31, 2024 primarily as a result of an increase in the average balance of time and savings deposits offset by a decrease in the average balances of money market deposits. The weighted average rate of interest-bearing deposits decreased to 2.65% for the year ended December 31, 2025 from 2.67% for the year ended December 31, 2024. Interest expense on borrowings decreased $1.3 million, or 33.3%, to $2.6 million for the year ended December 31, 2025 from $3.9 million for the year ended December 31, 2024 primarily due to a decrease in the average balance of borrowings. The average balance of borrowings decreased $26.3 million, or 32.1%, to $55.6 million for the year ended December 31, 2025 from $81.9 million for the year ended December 31, 2024. The weighted average rate of borrowings decreased to 4.64% for the year ended December 31, 2025 from 4.73% for the year ended December 31, 2024 due to a decrease in market interest rates. Net Interest and Dividend Income. Net interest and dividend income increased $1.8 million, or 15.0%, to $13.7 million for the year ended December 31, 2025 from $11.9 million for the year ended December 31, 2024. This increase was due to a $16.5 million, or 2.9%, increase in the average balance of interest-earning assets offset by an increase of $16.5 million, or 3.7%, in the average balance of interest-bearing liabilities. The increase in the average balance of interest-earning assets consisted primarily of an increase in the average balances of taxable debt securities offset by a decrease in taxable debt securities during the year ended December 31, 2025. The increase in the average balance of interest-bearing liabilities consisted primarily of an increase in the average balance of time and savings deposits offset by a decrease in the average balance of money market deposits and borrowings. Net interest rate spread increased to 1.72% for the year ended December 31, 2025 from 1.42% for the year ended December 31, 2024 due primarily to an increase in the average yield on interest-earning assets and a decrease in the average rate of interest-bearing liabilities. Release of Credit Losses. Based upon management’s analysis of the ACL, a $(1,000) release of credit losses was recorded for the year ended December 31, 2025 compared to a $(72,000) release of credit losses for the year ended 38 December 31, 2024. The release of credit losses for the year ended December 31, 2025 consisted of a $(60,000) release of credit losses on loans and a $59,000 provision for credit losses on off-balance sheet credit exposures. Non-Interest Income. Non-interest income decreased $2.2 million, or 55.1%, to $1.8 million for the year ended December 31, 2025 compared to $3.9 million for the year ended December 31, 2024. The decrease in non-interest income during the year ended December 31, 2025 was due primarily to a one-time $2.5 million gain on the sale of land and buildings recognized during the year ended December 31, 2024 offset by a $283,000 increase in customer service fees and an $89,000 increase in gain on sale of loans during the year ended December 31, 2025. During the year ended December 31, 2025 a commercial and industrial loan originated under the Small Business Administration 7(a) Guarantee program was sold. The 75% guarantee portion of the loan was sold, on a servicing-retained basis, at a gain of $102,000. Non-Interest Expense. Non-interest expense increased $1.1 million, or 6.7%, to $16.9 million for the year ended December 31, 2025 from $15.9 million for the year ended December 31, 2024. The increase in non-interest expense was due primarily to a $368,000, or 4.3%, increase in salaries and employee benefits, a $296,000, or 45.6%, increase in equity compensation expense, a $414,000, or 42.6%, increase in occupancy expense and a $135,000, or 9.0%, increase in data processing offset by a $67,000, or 19.0%, decrease in equipment expense and a $96,000, or 8.2%, decrease in professional fees and assessments during the year ended December 31, 2025. The increase in salaries and benefits during the year ended December 31, 2025 was due to normal salary increases. The increase in equity compensation expense was due to the incentive and non-statutory stock options granted in December 2024. The increase in occupancy expense was due primarily to the increase in lease expense associated with the sale-leaseback transaction completed on June 11, 2024. Income Taxes. Income tax benefit increased $1.2 million, or 221.1%, to a benefit of $638,000 for the year ended December 31, 2025 compared to a $527,000 income tax expense for the year ended December 31, 2024. The effective tax rate was (43.0)% and 3,764.3% for the years ended December 31, 2025 and 2024, respectively. (Loss) income before income tax (benefit) expense was $(1.5) million for the year ended December 31, 2025 as compared to $14,000 for the year ended December 31, 2024. The income tax benefit and effective tax rate for the year ended December 31, 2025 was greater than statutory federal and state rates due primarily to an $812,000 reduction of the deferred tax asset valuation allowance as of December 31, 2025 resulting from the change in accumulated other comprehensive income during the year ended December 31, 2025. The income tax expense and effective tax rate for the year ended December 31, 2024 was greater than statutory federal and state rates due primarily to the increase in the valuation allowance for all deferred tax assets during the year ended December 31, 2024. 39 Average Balance Sheets The following tables set forth average balance sheets, average yields and costs and certain other information at the date and for the years indicated. No tax-equivalent yield adjustments have been made, as the effects would be immaterial. All average balances are daily average balances. Non-accrual loans are included in the computation of average balances only. The yields set forth below include the effect of net deferred fee expense, discounts and premiums that are amortized or accreted to interest income or interest expense. Average loan balances exclude loans held for sale, if applicable. The following tables include no out-of-period items or adjustments. For the Year Ended December 31, 2025 2024 Average Outstanding Balance Interest Average Yield/Rate Average Outstanding Balance Interest Average Yield/Rate (Dollars in thousands) Interest-earning assets: Loans (4) $ 433,135 $ 20,214 4.67 % $ 433,244 $ 19,631 4.53 % Taxable debt securities 110,489 5,304 4.80 % 74,944 3,398 4.53 % Non-taxable debt securities 26,733 796 2.98 % 49,920 1,712 3.43 % Interest-bearing deposits with other banks 13,371 483 3.61 % 8,872 459 5.17 % Federal Home Loan Bank stock 2,545 189 7.42 % 2,794 231 8.26 % Total interest-earning assets 586,273 26,986 4.60 % 569,774 25,431 4.46 % Non-interest-earning assets 15,514 12,384 Total assets $ 601,787 $ 582,158 Interest-bearing liabilities: NOW and demand deposits $ 98,272 $ 637 0.65 % $ 95,786 $ 529 0.55 % Money market deposits 69,542 1,870 2.69 % 78,147 2,557 3.27 % Savings deposits 84,497 2,169 2.57 % 73,411 1,867 2.54 % Time deposits 151,894 6,030 3.97 % 114,277 4,696 4.11 % Total interest-bearing deposits 404,205 10,706 2.65 % 361,621 9,649 2.67 % Borrowings 55,584 2,582 4.64 % 81,880 3,873 4.73 % Other 1,883 11 0.59 % 1,691 11 0.66 % Total interest-bearing liabilities 461,672 13,299 2.88 % 445,192 13,533 3.04 % Non-interest-bearing deposits 66,137 65,200 Other noninterest-bearing liabilities 12,285 7,042 Total liabilities 540,094 517,434 Total equity 61,693 64,724 Total liabilities and equity $ 601,787 $ 582,158 Net interest income $ 13,687 $ 11,898 Net interest rate spread (1) 1.72 % 1.42 % Net interest-earning assets (2) $ 124,601 $ 124,582 Net interest margin (3) 2.33 % 2.09 % Average interest-earning assets as a percent of interest-bearing liabilities 126.99 % 127.98 % (1) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities. (2) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. (3) Net interest margin represents net interest income divided by average total interest-earning assets. (4) Net deferred fee expense included in loan interest totaled $487,000 and $475,000 for the years ended December 31, 2025 and 2024, respectively. 40 Rate/Volume Analysis The following table presents the effects of changing rates and volumes on our net interest income for the years indicated. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The total column represents the sum of the prior columns. For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately based on the changes due to rate and the changes due to volume. Year Ended December 31, 2025 vs. 2024 Increase (Decrease) Due to Total Increase Volume Rate (Decrease) (In thousands) Interest-earning assets: Loans $ (5 ) $ 588 $ 583 Taxable debt securities 1,696 210 1,906 Non-taxable debt securities (714 ) (202 ) (916 ) Interest-bearing deposits with other banks 189 (165 ) 24 Federal Home Loan Bank stock (20 ) (22 ) (42 ) Total interest-earning assets 1,146 409 1,555 Interest-bearing liabilities: NOW and demand deposits 14 94 108 Money market deposits (263 ) (424 ) (687 ) Savings deposits 284 18 302 Time deposits 1,499 (165 ) 1,334 Total interest-bearing deposits 1,534 (477 ) 1,057 Borrowings (1,222 ) (69 ) (1,291 ) Other 1 (1 ) — Total interest-bearing liabilities 313 (547 ) (234 ) Change in net interest income $ 833 $ 956 $ 1,789 Management of Market Risk General. Most of our assets and liabilities are monetary in nature. Consequently, our most significant form of market risk is interest rate risk. Our assets, consisting primarily of loans, have longer maturities than our liabilities, consisting primarily of deposits. As a result, a principal part of our business strategy is to manage our exposure to changes in market interest rates. Accordingly, the board of directors established a management-level Asset/Liability Management Committee (the “ALCO”), which takes responsibility for overseeing the asset/liability management process and related procedures. The ALCO meets on at least a quarterly basis and reviews asset/liability strategies, liquidity positions, alternative funding sources, interest rate risk measurement reports, capital levels and economic trends at both national and local levels. Our interest rate risk position is also monitored quarterly by the board of directors. We manage our interest rate risk in an effort to minimize the exposure of our earnings and capital to changes in market interest rates. We have implemented the following strategies to manage our interest rate risk: originating loans with adjustable interest rates; promoting core deposit products; selling a portion of fixed-rate one- to four-family residential real estate loans; maintaining investments as available-for-sale; diversifying our loan portfolio; and strengthening our capital position. By following these strategies, we believe that we are better positioned to react to changes in market interest rates. Net Portfolio Value Simulation. We analyze our sensitivity to changes in interest rates through a net portfolio value of equity (“NPV”) model. NPV represents the present value of the expected cash flows from our assets less the present value of the expected cash flows arising from our liabilities adjusted for the value of off-balance sheet contracts. The NPV ratio represents the dollar amount of our NPV divided by the present value of our total assets for a given interest rate scenario. NPV attempts to quantify our economic value using a discounted cash flow methodology while the NPV ratio reflects that value as a form of capital ratio. We estimate what our NPV would be at a specific date. We then calculate what the NPV would be at the same date throughout a series of interest rate scenarios representing immediate and permanent, parallel shifts in the yield curve. We currently calculate NPV under the assumptions that interest rates increase 100, 200, 300 and 400 basis points from current market rates and that interest rates decrease 100, 200, 300 and 400 basis points from current market rates. 41 The following table presents the estimated changes in our net portfolio value that would result from changes in market interest rates as of December 31, 2025 and 2024. As of December 31, 2025: Net Portfolio Value ("NPV") NPV as Percent of Portfolio Value of Assets Basis Point ("bp") Change in Interest Rates Dollar Amount Dollar Change Percent Change NPV Ratio Change (Dollars in thousands) 400 bp $ 43,504 $ (38,040 ) (46.6 )% 8.8 % $ (545 ) 300 bp 53,120 (28,424 ) (34.9 ) 10.3 (389 ) 200 bp 62,978 (18,566 ) (22.8 ) 11.8 (242 ) 100 bp 73,209 (8,335 ) (10.2 ) 13.2 (100 ) 0 81,544 — — 14.2 — (100) bp 87,157 5,613 6.9 14.7 52 (200) bp 89,450 7,906 9.7 14.7 52 (300) bp 89,024 7,480 9.2 14.3 10 (400) bp 81,076 (468 ) (0.6 ) 12.9 (133 ) As of December 31, 2024: Net Portfolio Value ("NPV") NPV as Percent of Portfolio Value of Assets Basis Point ("bp") Change in Interest Rates Dollar Amount Dollar Change Percent Change NPV Ratio Change (Dollars in thousands) 400 bp $ 41,552 $ (32,138 ) (43.6 )% 8.9 % $ (477 ) 300 bp 50,126 (23,564 ) (32.0 ) 10.3 (332 ) 200 bp 58,086 (15,604 ) (21.2 ) 11.6 (210 ) 100 bp 66,471 (7,219 ) (9.8 ) 12.7 (90 ) 0 73,690 — — 13.6 — (100) bp 79,465 5,775 7.8 14.2 59 (200) bp 82,581 8,891 12.1 14.4 72 (300) bp 83,028 9,338 12.7 14.1 41 (400) bp 79,737 6,047 8.2 13.2 (45 ) Certain shortcomings are inherent in the methodologies used in the above interest rate risk measurements. Modeling changes require making certain assumptions that may or may not reflect the manner in which actual yields and costs respond to changes in market interest rates. The above table assumes that the composition of our interest-sensitive assets and liabilities existing at the date indicated remains constant uniformly across the yield curve regardless of the duration or repricing of specific assets and liabilities. Accordingly, although the table provides an indication of our interest rate risk exposure at a particular point in time, such measurements are not intended to and do not provide a precise forecast of the effect of changes in market interest rates on our NPV and will differ from actual results. The percent changes to NPV in the +100, +200, +300 and +400 bp changes in interest rates was -10.2%, -22.8%, -34.9% and -46.6%, respectively, at December 31, 2025 versus policy limits of -10.0%, -20.0%, -30.0% and -40.0%, respectively. The percent changes to NPV in the +100, +200, +300 and +400 bp changes in interest rates was -9.8%, -21.2%, -32.0% and -43.6%, respectively, at December 31, 2024 versus policy limits of -10.0%, -20.0%, -30.0% and -40.0%, respectively. These percent changes were due primarily to the migration of deposits during 2025 and 2024 from less interest-sensitive products such as NOW and interest-bearing demand deposits to products with greater interest rate sensitivity, i.e., money market deposits and time deposits. We monitor our exposure to movements in interest rates regularly and discuss the implementation of strategies we believe will mitigate the negative impact of such movements. Economic Value of Equity. Like most financial institutions, our profitability depends to a large extent upon our net interest income, which is the difference between our interest income on interest-earning assets, such as loans and securities, and our interest expense on interest-bearing liabilities, such as deposits and borrowed funds, adjusted for the value of off-balance sheet contracts. Accordingly, our results of operations depend largely on movements in market interest rates and our ability to manage our interest-rate sensitive assets and liabilities in response to these movements. Factors such as inflation, recession, and instability in financial markets, among other factors beyond our control, may affect interest rates. 42 In a rising interest rate environment, we would expect that the rates on our deposits and borrowings would reprice upwards faster than the rates on our long-term loans and investments, which would be expected to compress our interest rate spread and have a negative effect on our profitability. Furthermore, increases in interest rates may adversely affect the ability of our borrowers to make loan repayments on adjustable-rate loans, as the interest owed on such loans would increase as interest rates increase. Conversely, decreases in interest rates can result in increased prepayments of loans and mortgage-related securities, as borrowers refinance to reduce their borrowing costs. Under these circumstances, we are subject to reinvestment risk as we may have to redeploy such loan or securities proceeds into lower-yielding assets, which might also negatively impact our income. If interest rates rise, we expect that our economic value of equity will decrease. Economic value of equity represents the present value of the expected cash flows from our assets less the present value of the expected cash flows arising from our liabilities. The Bank’s economic value of equity analysis as of December 31, 2025 estimated that, in the event of an instantaneous 200 basis point increase in interest rates, the Bank would experience a 22.8% decrease in economic value of equity which was above the policy limit of 20.0%. At the same date, our analysis estimated that, in the event of an instantaneous 200 basis point decrease in interest rates, the Bank would experience a 9.7% increase in the economic value of equity. Any substantial, unexpected, prolonged change in market interest rates could have a material adverse effect on our financial condition, liquidity and results of operations. Changes in the level of interest rates may also negatively affect our ability to originate real estate loans, the value of our assets and our ability to realize gains from the sale of our assets, all of which ultimately affect our earnings. Also, our interest rate risk modeling techniques and assumptions likely may not fully predict or capture the impact of actual interest rate changes on our balance sheet or projected operating results. Liquidity and Capital Resources Liquidity describes our ability to meet the financial obligations that arise in the ordinary course of business. Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures. As of December 31, 2025 and 2024, the aggregate amount of uninsured total deposit balances, which is the portion exceeding the $250,000 FDIC insurance limit, had an estimated value not exceeding $107.7 million, or 22.9% of total deposits, and $112.2 million, or 24.7% of total deposits, respectively. For customers requiring full FDIC insurance on certificates of deposit in excess of $250,000, we offer the CDARS® program, which allows the Bank to place the certificates of deposit with other participating banks to maximize the customers’ FDIC insurance. We receive a like amount of deposits from other participating financial institutions. In addition, we offer the ICS™ program, an insured deposit “sweep” program for demand deposits which is a product offered by IntraFi Network, LLC, which is also the provider of the CDARS® program. Similarly to the certificates of deposit’s discussed above, the Bank receives a like amount of deposits from other financial institutions and all customer deposits are insured by the FDIC. These “reciprocal” CDARS® and ICS deposits are classified as “brokered” deposits in regulatory reports. The Bank considers these deposits to be “core” in nature. At December 31, 2025, our “reciprocal” CDARS® and ICS deposits were $-0- and $9.1 million, respectively. At December 31, 2024, our “reciprocal” CDARS® and ICS deposits were $-0- and $6.0 million, respectively. Our primary sources of funds are deposits, principal and interest payments on loans and securities, proceeds from the sale of loans and proceeds from sales and maturities of securities. We also rely on borrowings from the FHLB as supplemental sources of funds. At December 31, 2025 and 2024, we had $52.3 million outstanding in advances from the FHLB and the ability to borrow an additional $96.6 million and $94.0 million, respectively. At December 31, 2025 and 2024, the Bank had an overnight line of credit with the FHLB for up to $3.0 million. The Bank has a secured credit facility with the FRB – BIC Program. The Bank’s unused available borrowing capacity at the FRB was $34.1 million and $-0- at December 31, 2025 and December 31, 2024, respectively. Additionally, at December 31, 2025 and 2024, the Bank had a $2.0 million unsecured Fed Funds borrowing line of credit with a correspondent bank. At December 31, 2025 and 2024, there were no outstanding balances under any of these additional credit facilities. Advances under the BIC, if any, are collateralized by eligible collateral. During December 2024, the Bank unpledged the collateral previously pledged to the BIC - principally general obligation municipal bonds – with the intention of pledging commercial real estate loans. On January 7, 2025, the Bank completed the collateral eligibility process with the FRB whereby the FHLB agreed to subordinate their interest in our commercial real estate loans up to a maximum of $65 million allowing these loans to be pledged to the BIC. The Bank subsequently pledged $65.0 million of its commercial real estate loans to the BIC resulting in $38.5 million of borrowing capacity under this credit facility as of January 16, 2025. On September 9, 2025, the FHLB agreed to increase the subordination of their interest in our commercial real estate loans up to a maximum of $71.7 million allowing these loans to be pledged to the BIC. While maturities and scheduled amortization of loans and securities are predictable sources of funds, deposit flows and loan prepayments are greatly influenced by general interest rates, economic conditions and competition. Our most liquid assets are cash and cash equivalents and available-for-sale investment securities. The levels of these assets are dependent on our operating, financing, lending and investing activities during any given period. 43 Our cash flows are comprised of three primary classifications: cash flows from operating activities; investing activities and financing activities. Net cash provided (used) by operating activities was $449,000 and $(2.9) million for the years ended December 31, 2025 and 2024, respectively. Net cash used by investing activities, which consists primarily of disbursements for loan originations and loan purchases and the purchase of securities available-for-sale, offset by principal collections on loans, proceeds from sales, maturities and principal payments received on securities available-for-sale, was $9.9 million and $2.5 million for the years ended December 31, 2025 and 2024, respectively. Net cash provided by financing activities, consisting primarily of proceeds from the activity in deposit accounts and FHLB advances was $15.7 million and $6.5 million for the years ended December 31, 2025 and 2024, respectively. We are committed to maintaining a strong liquidity position. We monitor our liquidity position daily. We anticipate that we will have sufficient funds to meet our current funding commitments. We have no material commitments for capital expenditures as of December 31, 2025. Our current strategy is to increase core deposits and utilize FHLB advances, as well as brokered deposits, to fund loan growth. First Seacoast Bancorp, Inc. is a separate legal entity from First Seacoast Bank and must provide for its own liquidity to pay its operating expenses and other financial obligations and to fund repurchases of shares of common stock. The Company’s primary source of income is dividends received from the Bank. The amount of dividends that the Bank may declare and pay to the Company is governed by applicable bank regulations. At December 31, 2025 the Company (on an unconsolidated basis) had liquid assets of $16.5 million. At December 31, 2025, First Seacoast Bank exceeded all of its regulatory capital requirements. See Note 16 of the notes to our consolidated financial statements of this annual report. Management is not aware of any conditions or events that would change First Seacoast Bank’s categorization as well-capitalized. Recent Accounting Developments For a discussion of the impact of recent accounting pronouncements, see Note 3 of the notes to our consolidated financial statements of this annual report. Impact of Inflation and Changing Prices The consolidated financial statements and related data presented herein have been prepared in accordance with generally accepted accounting principles in the United States of America, which require the measurement of financial position and operating results in terms of historical dollars without considering changes in the relative purchasing power of money over time due to inflation. The primary impact of inflation on our operations is reflected in increased operating costs. Unlike most industrial companies, virtually all of the assets and liabilities of a financial institution are monetary in nature. As a result, interest rates generally have a more significant impact on a financial institution’s performance than does inflation. Interest rates do not necessarily move in the same direction or to the same extent as the prices of goods and services. ITEM 7A. Quantitative and Qualita tive Disclosures About Market Risk The information regarding this Item is contained in Item 7 under the heading “Management of Market Risk.” 44 ITEM 8. Financial Statement s and Supplementary Data FIRST SEACOAST BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in thousands) December 31, 2025 2024 ASSETS Cash and due from banks $ 13,414 $ 7,100 Securities available-for-sale, at fair value 152,406 120,217 Federal Home Loan Bank stock 2,431 2,498 Total loans 419,474 438,967 Less: Allowance for credit losses on loans ( 3,427 ) ( 3,486 ) Net loans 416,047 435,481 Land, building and equipment, net 589 754 Bank-owned life insurance 4,875 4,768 Accrued interest receivable 2,108 2,103 Other assets 7,425 7,859 Total assets $ 599,295 $ 580,780 LIABILITIES AND STOCKHOLDERS' EQUITY Deposits: Non-interest bearing deposits $ 69,693 $ 62,168 Interest bearing deposits 401,080 392,040 Total deposits 470,773 454,208 Advances from Federal Home Loan Bank 52,308 52,268 Mortgagors’ tax escrow 811 654 Deferred compensation liability 2,667 2,392 Other liabilities 9,189 9,208 Total liabilities 535,748 518,730 Stockholders' Equity: Preferred Stock, $ .01 par value, 10,000,000 shares authorized, none issued — — Common Stock, $ .01 par value, 90,000,000 shares authorized; 5,304,812 issued and 4,694,149 outstanding at December 31, 2025; and 5,304,812 issued and 4,785,569 outstanding at December 31, 2024 53 53 Additional paid-in capital 54,517 53,900 Retained earnings 24,239 25,084 Accumulated other comprehensive loss ( 4,839 ) ( 7,044 ) Treasury stock, at cost: 610,663 and 519,243 shares outstanding as of December 31, 2025 and 2024, respectively ( 6,066 ) ( 5,085 ) Unearned stock compensation ( 4,357 ) ( 4,858 ) Total stockholders' equity 63,547 62,050 Total liabilities and stockholders' equity $ 599,295 $ 580,780 The accompanying notes are an integral part of these consolidated financial statements. 45 FIRST SEACOAST BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF LOSS Year Ended December 31, (Dollars in thousands, except per share data) 2025 2024 Interest and dividend income: Interest and fees on loans $ 20,214 $ 19,631 Interest on debt securities: Taxable 5,787 3,857 Non-taxable 796 1,712 Total interest on debt securities 6,583 5,569 Dividends 189 231 Total interest and dividend income 26,986 25,431 Interest expense: Interest on deposits 10,717 9,660 Interest on borrowings 2,582 3,873 Total interest expense 13,299 13,533 Net interest and dividend income 13,687 11,898 Release of credit losses ( 1 ) ( 72 ) Net interest and dividend income after release of credit losses 13,688 11,970 Non-interest income: Customer service fees 1,005 722 Gain on sale of loans 114 25 Securities gains, net — 7 Gain on sale of land, building and equipment — 2,522 Income from bank-owned life insurance 107 105 Loan servicing fee income 29 48 Investment services fees 450 431 Other income 48 44 Total non-interest income 1,753 3,904 Non-interest expense: Salaries and employee benefits 8,952 8,584 Equity compensation expense 944 648 Director compensation 425 345 Occupancy expense 1,386 972 Equipment expense 285 352 Marketing 409 419 Data processing 1,637 1,502 Deposit insurance fees 440 399 Professional fees and assessments 1,078 1,174 Debit card fees 182 128 Employee travel and education expenses 191 177 Other expense 995 1,160 Total non-interest expense 16,924 15,860 (Loss) income before income tax (benefit) expense ( 1,483 ) 14 Income tax (benefit) expense ( 638 ) 527 Net loss $ ( 845 ) $ ( 513 ) Loss per share: Basic $ ( 0.23 ) $ ( 0.12 ) Diluted $ ( 0.23 ) $ ( 0.12 ) Weighted Average Shares: Basic 3,676,427 4,335,154 Diluted (1) 3,676,427 4,335,154 (1) Not adjusted for potentially dilutive shares for years where a net loss is recognized. The years ended December 31, 2025 and 2024 exclude 471,138 and 488,086 , respectively, of stock-based awards that could potentially dilute basic earnings per share in the future that were not included in the computation of diluted earnings per share because to do so would have been antidilutive for the years presented. The accompanying notes are an integral part of these consolidated financial statements. 46 FIRST SEACOAST BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS Year Ended December 31, (Dollars in thousands) 2025 2024 Net loss $ ( 845 ) $ ( 513 ) Other comprehensive income (loss), net of income taxes (1) : Securities available-for-sale: Unrealized holding gains (losses) on securities available-for-sale arising during the year, net of income taxes of $ 708 and $( 540 ) in 2025 and 2024, respectively 1,921 ( 1,463 ) Reclassification adjustment for securities gains, net and net amortization of bond premiums included in net loss, net of income taxes of $ 104 and $ 146 in 2025 and 2024, respectively 283 394 Total unrealized gain (loss) on securities available-for-sale 2,204 ( 1,069 ) Derivatives: Change in interest rate swaps, net of income taxes of $( 2 ) and $( 3 ) in 2025 and 2024, respectively ( 5 ) ( 9 ) Reclassification adjustment for gains and net interest income on swaps included in net loss, net of income taxes of $ 2 and $( 8 ) in 2025 and 2024, respectively 6 ( 22 ) Total change in interest rate swaps 1 ( 31 ) Other comprehensive income (loss) 2,205 ( 1,100 ) Comprehensive income (loss) $ 1,360 $ ( 1,613 ) ( 1) Includes a deferred tax valuation allowance equal to the net tax benefit. The accompanying notes are an integral part of these consolidated financial statements. 47 FIRST SEACOAST BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (Dollars in thousands) Shares of Common Stock Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Treasury Stock Unearned Stock Compensation Total Stockholders' Equity Balance December 31, 2023 5,077,164 $ 52 $ 52,642 $ 25,597 $ ( 5,944 ) $ ( 1,381 ) $ ( 4,348 ) $ 66,618 Net loss — — — ( 513 ) — — — ( 513 ) Other comprehensive loss — — — — ( 1,100 ) — — ( 1,100 ) Treasury stock activity ( 403,795 ) — — — — ( 3,704 ) — ( 3,704 ) Excise tax on stock repurchases — — ( 37 ) — — — — ( 37 ) Issuance of stock compensation 112,200 1 1,041 — — — ( 1,042 ) — Amortization of unearned stock compensation — — — — — — 378 378 Stock-based compensation expense — — 270 — — — — 270 ESOP shares earned - 15,354 shares — — ( 16 ) — — — 154 138 Balance December 31, 2024 4,785,569 $ 53 $ 53,900 $ 25,084 $ ( 7,044 ) $ ( 5,085 ) $ ( 4,858 ) $ 62,050 Balance December 31, 2024 4,785,569 $ 53 $ 53,900 $ 25,084 $ ( 7,044 ) $ ( 5,085 ) $ ( 4,858 ) $ 62,050 Net loss — — — ( 845 ) — — — ( 845 ) Other comprehensive income — — — — 2,205 — — 2,205 Treasury stock activity ( 91,420 ) — — — — ( 981 ) — ( 981 ) Excise tax on stock repurchases — — 1 — — — — 1 Amortization of unearned stock compensation — — — — — — 347 347 Stock-based compensation expense — — 596 — — — — 596 ESOP shares earned - 15,354 shares — — 20 — — — 154 174 Balance December 31, 2025 4,694,149 $ 53 $ 54,517 $ 24,239 $ ( 4,839 ) $ ( 6,066 ) $ ( 4,357 ) $ 63,547 The accompanying notes are an integral part of these consolidated financial statements. 48 FIRST SEACOAST BANCORP INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Year Ended December 31, (Dollars in thousands) 2025 2024 Cash flows from operating activities: Net loss $ ( 845 ) $ ( 513 ) Adjustments to reconcile net loss to net cash provided (used) by operating activities: ESOP expense 174 138 Stock based compensation 943 648 Depreciation and amortization 317 384 Net amortization of bond premium 387 549 Securities gains, net — ( 7 ) Release of credit losses ( 1 ) ( 72 ) Gain on sale of loans ( 114 ) ( 25 ) Gain on sale of land, building and equipment — ( 2,522 ) Proceeds from loans sold 3,902 411 Origination of loans sold ( 3,788 ) ( 386 ) Increase in bank-owned life insurance ( 107 ) ( 105 ) Increase in deferred costs on loans ( 124 ) ( 136 ) Deferred tax (benefit) expense ( 808 ) 403 (Increase) decrease in accrued interest receivable ( 5 ) 191 Decrease (increase) in other assets 264 ( 6,901 ) Increase in deferred compensation liability 275 321 Increase in lease liabilities — 5,061 Decrease in other liabilities ( 21 ) ( 387 ) Net cash provided (used) by operating activities 449 ( 2,948 ) Cash flows from investing activities: Proceeds from sales, calls, maturities and principal payments received on securities available-for-sale 21,109 36,223 Purchase of securities available-for-sale ( 50,673 ) ( 36,685 ) Purchase of property and equipment ( 120 ) ( 368 ) Loan purchases ( 5,511 ) ( 4,486 ) Loan originations and principal collections, net 25,269 ( 4,648 ) Net redemption of Federal Home Loan Bank stock 67 488 Proceeds from sale of land, building and equipment — 7,395 Termination of fair value hedges — ( 430 ) Net cash used by investing activities ( 9,859 ) ( 2,511 ) Cash flows from financing activities: Net increase in NOW, demand deposits, money market and savings accounts 361 4,974 Net increase in time deposits 16,204 44,436 Increase in mortgagors’ escrow accounts 157 14 Proceeds of finance lease — 1,539 Principal payments on finance lease ( 57 ) ( 30 ) Treasury stock purchases ( 981 ) ( 3,704 ) Proceeds from long-term FHLB advances 560 25,401 Net payments on short-term FHLB advances — ( 20,340 ) Payments on long-term FHLB advances ( 520 ) ( 25,800 ) Payments on advances from Federal Reserve Bank — ( 20,000 ) Net cash provided by financing activities 15,724 6,490 Net change in cash and cash equivalents 6,314 1,031 Cash and cash equivalents at beginning of year 7,100 6,069 Cash and cash equivalents at end of year $ 13,414 $ 7,100 49 Supplemental disclosure of cash flow information: Cash activities: Cash paid for interest $ 13,289 $ 13,439 Cash paid for income taxes 120 49 Noncash activities: Effect of change in fair value of securities available-for-sale: Securities available-for-sale 3,016 ( 1,463 ) Deferred taxes ( 812 ) 394 Other comprehensive income (loss) 2,204 ( 1,069 ) Effect of change in fair value of interest rate swaps: Interest rate swaps 1 ( 42 ) Deferred taxes — 11 Other comprehensive income (loss) 1 ( 31 ) Cumulative fair value hedging adjustment - loans 139 675 Cumulative fair value hedging adjustment - securities available-for-sale — 126 The accompanying notes are an integral part of these consolidated financial statements. 50 FIRST SEACOAST BANCORP, INC. AND SUBSIDIARIES Notes to consolidated Financial Statements 1. The Company The accompanying consolidated financial statements include the accounts of First Seacoast Bancorp, Inc. (the “Company”), its wholly-owned subsidiary, First Seacoast Bank (the “Bank”), and the Bank’s wholly-owned subsidiary, FSB Service Corporation, Inc. All significant intercompany balances and transactions have been eliminated in consolidation. Corporate Structure The Bank offers a full range of banking and investment management services to its customers. The Bank focuses on four core services that center around customer needs. The core services include residential lending, commercial banking, personal banking and wealth management. The Bank offers a full range of commercial and consumer banking services through its network of five full-service branch locations. Investment management services are offered through FSB Wealth Management - a division of First Seacoast Bank. The division currently consists of two financial advisors who are located in Dover, New Hampshire. FSB Wealth Management provides access to non-FDIC insured products that include retirement planning, portfolio management, investment and insurance strategies, business retirement plans and college planning to individuals throughout our primary market area. These investments and services are offered through a third-party registered broker-dealer and investment advisor. FSB Wealth Management receives fees from advisory services and commissions on individual investment and insurance products purchased by clients. The assets held for wealth management customers are not assets of the Company and, accordingly, are not reflected in the Company’s consolidated balance sheets. The Bank is engaged principally in the business of attracting deposits from the public and investing those funds in various types of loans, including residential and commercial real estate loans, and a variety of commercial and consumer loans. The Bank also invests its deposits and borrowed funds in investment securities. Deposits at the Bank are insured by the Federal Deposit and Insurance Corporation (“FDIC”) for the maximum amount permitted by law. 2. Summary of Significant Accounting Policies Basis of Presentation The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”). Use of Estimates In preparing the consolidated financial statements in conformity with GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated balance sheet and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates that are particularly susceptible to change relate to the determination of the allowance for credit losses and the valuation of deferred tax assets. Consolidated Statements of Cash Flows For the purpose of reporting cash flows, cash includes cash and due from banks with original maturities of 90 days or less. Reclassifications Certain amounts in the prior year’s consolidated financial statements may have been reclassified to conform with the current year’s presentation. Securities Available-for-Sale The Company classifies the available-for-sale securities portfolio into the following major security types: U.S. Government-sponsored enterprise obligations, U.S. Government agency small business administration pools guaranteed by SBA, collateralized mortgage obligations issued by the FHLMC, FNMA and GNMA, residential mortgage-backed securities, municipal bonds, corporate debt and corporate subordinated debt. Nearly all of the mortgage-backed securities held by the Company are issued by the U.S. government and its entities and agencies. These securities are either explicitly or implicitly guaranteed by the U.S. government, are highly rated by major rating agencies and have a history of no credit losses. The remainder of the residential mortgage-backed securities are non-agency collateralized mortgage obligations which currently carry investment-grade bond ratings. At December 31, 2025, municipal bonds are highly-rated and are issued by state and 51 local governments with minimal credit risk. Available-for-sale securities consist of debt securities that the Company intends to hold for an indefinite period of time, but not necessarily to maturity. These assets are carried at fair value. Unrealized holding gains and losses for these assets, net of related deferred income taxes adjusted for valuation allowances, are recorded in and reported as accumulated other comprehensive loss within stockholders’ equity. For debt securities in an unrealized loss position, the Company considers the extent of the unrealized loss and the financial condition and near-term prospects of the issuer. The Company also determines whether it has the intent to sell the debt security or whether it is more likely than not it will be required to sell the debt security before the recovery of its amortized cost basis. If either condition is met, the Company will write-down to fair value through a charge to earnings. For all other debt securities, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, the Company considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to this security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security is compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount the fair value is less than the amortized cost basis. Losses related to non-credit- related factors will be recorded in other comprehensive (loss) income. Changes in the allowance for credit losses are recorded as provision for (or reversal of) credit loss expense. Losses are charged against the allowance when management believes the uncollectibility of an available-for-sale security is confirmed or when either of the criteria regarding intent or requirement to sell is met. Debt securities are placed on non-accrual status at the time any principal or interest payments become 90 days delinquent. Interest accrued but not received for a security placed on non-accrual is reversed against interest income. Gains and losses on the sale of available-for-sale securities are determined using the specific identification method. Premiums and discounts are recognized in interest income using the interest method. Discounts are recognized over the period to maturity. Premiums are recognized over the period to call, if applicable. Otherwise, premiums are recognized over the period to maturity. Federal Home Loan Bank Stock Federal Home Loan Bank (“FHLB”) stock is carried at cost and can only be sold to the FHLB based on its current redemption policies. The Company reviews its investment in capital stock of the FHLB for impairment based on the ultimate recoverability of the cost basis in the FHLB stock. Based on the most recent analysis of the FHLB, as of December 31, 2025, management deems its investment in FHLB stock to not be impaired. Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal balances adjusted for charge-offs, the allowance for credit losses, net deferred loan origination fees/costs on originated loans or unamortized premiums or discounts on purchased loans. Interest income is accrued on the unpaid principal balance on a simple interest basis. The accrual of interest on loans is discontinued at the time the loan is 90 days past due or determined to be non-performing, if earlier. Past due status is based on contractual terms of the loan. In all cases, loans are placed on non-accrual if collection of principal or interest is considered doubtful. All interest accrued but not collected for such loans is reversed against interest income. For payments received on such loans, the interest is accounted for on the cash-basis or recorded as a reduction to loan principal if recovery is not assured, until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. Cash receipts of interest income on non-performing loans are credited to principal to the extent necessary to eliminate doubt as to the collectability of the net carrying amount of the loan. Some or all of the cash receipts of interest income on non-performing loans is recognized as interest income if the remaining net carrying amount of the loan is deemed to be fully collectible. When recognition of interest income on a non-performing loan on a cash basis is appropriate, the amount of income that is recognized is limited to that which would have been accrued on the net carrying amount of the loan at the contractual interest rate. Any cash interest payments received in excess of the limit and not applied to reduce the net carrying amount of the loan are recorded as recoveries of charge-offs until the charge-offs are fully recovered. Loan Origination Fees and Costs Loan origination fees and certain direct loan origination costs are deferred and recognized in interest income as an adjustment to the loan yield over the life of the related loans. The unamortized net deferred fees and costs are included on the consolidated balance sheets with the related loan balances. The amount charged or credited to income is included with the related interest income. 52 Allowance for Credit Losses ("ACL") The Company estimates its allowance for credit losses ("ACL") as outlined in Accounting Standards Update ("ASU") 2016-13, " Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, as amended ("ASU 2016-13" or “ASC 326”)." Under ASC 326, the ACL at each reporting period serves as a best estimate of projected credit losses over the contractual life of certain assets and off-balance sheet exposures, adjusted for expected prepayments, given an expectation of economic conditions and forecasts as of the valuation date. Upon adoption of ASC 326, the Company made the following elections regarding accrued interest receivable: (i) present accrued interest receivable balances separately on the balance sheet on the consolidated statements of condition; (ii) exclude accrued interest from the measurement of the ACL, including investments and loans; and (iii) continue to write-off accrued interest receivable by reversing interest income. The Company has a policy in place to write-off accrued interest when a loan is placed on non-accrual. Accrued interest is written-off by reversing previously recorded interest income. For loans, write-off typically occurs when a loan has been in default for 90 days or more. Immaterial amounts of accrued interest on non-accrual loans were written off during the years ended December 31, 2025 and 2024, by reversing interest income. Historically, the Company has not experienced uncollectible accrued interest receivable on its securities available-for-sale. The ACL is the sum of various components including the following: (a) historical loss experience, (b) a reasonable and supportable forecast, (c) loans evaluated individually, and (d) changes in relevant environmental factors. The historical loss component is segmented by loan type and serves as the core of the ACL adequacy methodology. The Company has selected the Weighted Average Remaining Maturity Model (“WARM”), for the loss calculation of each of the Bank’s loan pools utilizing a third-party software application. The WARM uses a quarterly loss rate and future expectations of loan balances to calculate an ACL. A loss rate is applied to pool balances over time. ASC 326 may create volatility in the ACL, specifically the ACL on loans and ACL on off-balance sheet credit exposures. Under ASC 326, the ACL may increase or decrease period to period based on many factors, including, but not limited to: (i) macroeconomic forecasts and conditions; (ii) forecast period and reversion speed; (iii) prepayment speed assumption; (iv) loan portfolio volumes and changes in mix; (v) credit quality; and (vi) various qualitative factors outlined in ASU 2016-13. The significant key assumptions used with the ACL calculation at December 31, 2025 and 2024 using the ASC 326 methodology, included: • Macroeconomic factors (loss drivers): Monitoring and assessing local and national unemployment, changes in national GDP and other macroeconomic factors which may be the most predictive indicator of losses within the loan portfolio. The macroeconomic factors considered in determining the ACL may change from time to time. • Forecast Period and Reversion speed: ASU 2016-13 requires a company to use a reasonable and supportable forecast period in developing the ACL, which represents the time period that management believes it can reasonably forecast the identified loss drivers. Generally, the forecast period the Company believes to be reasonable and supportable will be set annually and validated through an assessment of economic leading indicators. In periods of greater volatility and uncertainty, such as the current interest rate environment, the Company will likely use a shorter forecast period, whereas when markets, economies, interest rate environment, political matters, and other factors are considered to be more stable and certain, a longer forecast period may be used. Also, in times of greater uncertainty, the Company may consider a range of possible forecasts and evaluate the probability of each scenario. Generally, the forecasted period is expected to range from one to three years. Once the reasonable and supportable forecast period is determined, ASU 2016-13 requires a company to revert its loss expectations to the long-run historical mean for the remainder of the contract life of the asset, adjusted for prepayments. In determining the length of time over which the reversion will take place (i.e., "reversion speed"), factors such as, historical credit loss experience over previous economic cycles, as well as where the Company believes it is within the current economic cycle, will be considered. At December 31, 2025 and 2024, the Company has chosen a forecast period of four quarters which will be similar to the historical loss period between January 2014 and December 2016 and then reverting to the long-term average over the following two quarters using the straight-line reversion method. The Company believes this historical forecast period to be representative of potential economic conditions over the next eighteen months. • Prepayment speeds: Prepayment speeds are determined for each loan segment utilizing the Company's historical loan data, as well as consideration of current environmental factors. The prepayment speed assumption is utilized with the WARM method to forecast expected cash flows over the contractual life of the loan, adjusted for expected prepayments. A higher prepayment speed assumption will drive a lower ACL, and vice versa. • Qualitative factors: As within previous accounting guidance used for the "incurred loss" model, ASU 2016-13 requires companies to consider various qualitative factors that may impact expected credit losses. The Company continues to consider qualitative factors in determining and arriving at an ACL at each reporting period such as: (i) actual or expected changes in economic trends and conditions, (ii) changes in the value of underlying collateral for loans, (iii) changes to lending policies, underwriting standards and/or management personnel performing such functions, (iv) delinquency and other 53 credit quality trends, (v) credit risk concentrations, if any, (vi) changes to the nature of the Company's business impacting the loan portfolio, (vii) and other external factors, that may include, but are not limited to, results of internal loan reviews and examinations by bank regulatory agencies. Certain loans which may not share similar risk characteristics with other loans in the portfolio may be tested individually for estimated credit losses, including (i) loans classified as special mention, substandard or doubtful and are on non-accrual, (ii) a loan modified for a borrower experiencing financial difficulty or (iii) loans that have other unique characteristics. Factors considered in measuring the extent of the expected credit loss for these loans may include payment status, collateral value, borrower's financial condition, guarantor support and the probability of collecting scheduled principal and interest payments when due. The ACL is measured on a collective basis for pools of loans with similar risk characteristics. The Company has identified the following pools of financial assets with similar risk characteristics for measuring expected credit losses: • Owner occupied commercial real estate mortgage loans - Owner occupied commercial real estate mortgage loans are secured by commercial office buildings, industrial buildings, warehouses or retail buildings where the owner of the building occupies the property. For such loans, repayment is largely dependent upon the operation of the borrower's business. • Non-owner occupied commercial real estate and multi-family real estate loans - These loans represent investment real estate loans secured by office buildings, industrial buildings, warehouses, retail buildings, and multi-family residential housing. Repayment is primarily dependent on lease income generated from the underlying collateral. • Consumer real estate mortgage loans - Consumer real estate mortgage consists primarily of loans secured by one- to four-family residential properties, including home equity loans and lines of credit. Repayment is primarily dependent on the personal cash flow of the borrower. • Acquisition, development and land loans - Acquisition, development and land loans include loans where the repayment is dependent on the successful completion and eventual sale, refinance or operation of the related real estate project. Acquisition, development and land loans include one- to four-family construction projects and commercial construction or rehabilitation endeavors such as warehouses, apartments, office and retail space and land acquisition and development. • Commercial and industrial loans - Commercial and industrial loans include loans to business enterprises issued for commercial, industrial and/or other professional purposes. These loans are generally secured by equipment, inventory, and accounts receivable of the borrower and repayment is primarily dependent on business cash flows. • Consumer and other loans - Consumer and other loans include all loans issued to individuals, primarily pre-existing Bank customers, not included in the consumer real estate mortgage classification and purchased loans secured by manufactured housing properties. Examples of consumer and other loans are automobile loans and other installment loans extended directly to the borrower. Consumer loans may be unsecured. Repayment is primarily dependent on the personal cash flow of the borrower. The WARM method uses an approach that begins with a quarterly loss rate and applies that rate to the loan pools of financial assets with similar risk characteristics noted above on a periodic basis over time for the remaining life expectation of each loan pool. Due to the Company’s limited loss experience, the Company has chosen to use peer group loss data in the calculation of the quarterly loss rate. A peer group was selected within the third-party software application which includes all banks between $ 300 million and $ 1 billion in asset size located in the northeastern United States. The historical loss component segmented by loan pool serves as the core of the ACL adequacy methodology. The remaining life calculation for each pool is calculated by the third-party software application using an attrition calculator that performs quarterly cohort-based attrition measurements using the actual historical experience of each loan pool. The estimated credit losses for all loan pools are adjusted for changes in qualitative factors not inherently considered in the quantitative analyses. The qualitative categories and the measurements used to quantify the risks within each of these categories are subjectively selected by the Company but measured by objective measurements period over period. The data for each measurement may be obtained from internal or external sources. The current period measurements are evaluated and assigned a factor commensurate with the current level of risk relative to past measurements over time. The resulting qualitative adjustments are applied to the relevant collectively evaluated loan portfolios. These adjustments are based upon quarterly trend assessments in portfolio concentrations, policy exceptions, associate retention, independent loan review results, competition and peer group credit quality trends. The qualitative allowance allocation, as determined by the processes noted above, is increased or decreased for each loan segment based on the assessment of these various qualitative factors. Additional qualitative considerations are made for any identified risk which did not exist within the portfolio historically and therefore may not be adequately addressed through evaluation of such risk factor based on historical portfolio trends as previously discussed. 54 Expected credit losses are estimated over the contractual term of the loans, adjusted for expected prepayments when appropriate. The contractual term excludes expected extensions, renewals, and modifications unless either of the following applies: the Company has a reasonable expectation at the reporting date that a modification will be executed with an individual borrower, or the extension or renewal options are included in the original or modified contract at the reporting date and are not unconditionally cancellable by the Company. Modifications to borrowers experiencing financial difficulty may include interest rate reductions, principal or interest forgiveness, forbearances, term extensions, and other actions intended to minimize economic loss and to avoid foreclosure or repossession of collateral. The allowance for credit losses on off-balance sheet credit exposures represents the expected credit losses on off-balance sheet commitments such as unfunded commitments to extend credit and standby letters of credit. However, a liability is not recognized for commitments unconditionally cancellable by the Company. The allowance for credit losses on off-balance sheet credit exposures is recognized as a liability (other liabilities in the consolidated balance sheet), with adjustments to the allowance recognized in the provision for credit losses in the consolidated statements of loss. The allowance for credit losses on off-balance sheet credit exposures is determined by estimating future draws and applying the expected loss rates on those draws. Future draws are based on historical averages of utilization rates (i.e., the likelihood of draws taken). To estimate future draws on unfunded balances, current utilization rates are compared to historical utilization rates. If current utilization rates are below historical utilization rates, the rate difference is applied to the committed balance to estimate the future draw. Loss rates are estimated by utilizing the same loss rates calculated for the allowance for credit losses general reserves. While policies and procedures used to estimate the ACL, as well as the resultant provision for credit losses charged to loss, are considered adequate by the Company, they are necessarily approximate and imprecise. There are factors beyond the Company's control, such as changes in projected economic conditions, real estate markets or particular industry conditions which may materially impact asset quality and the adequacy of the ACL and thus the resulting provision for credit losses. Land, Building and Equipment Land is stated at cost. Building and equipment are stated at cost, less accumulated depreciation. Depreciation is computed on the straight-line method over the estimated useful lives of the assets or the lease term for leasehold improvements unless renewal is reasonably assured. Maintenance and repair costs are included in operating expenses while major expenditures for improvements are capitalized and depreciated. The cost and related accumulated depreciation of assets sold, or otherwise disposed of, are removed from the related accounts and any gain or loss is included in earnings. Bank-owned Life Insurance Bank-owned life insurance policies are reflected on the consolidated balance sheets at cash surrender value. Changes in the net cash surrender value of the policies, as well as insurance proceeds received, are reflected in non-interest income on the consolidated statements of loss and are generally not subject to income taxes. The Company reviews the financial strength of the insurance carriers prior to the purchase of life insurance policies and no less than annually thereafter. A life insurance policy with any individual carrier is limited to 15 % of Tier one capital, and the total cash surrender value of life insurance policies is limited to 25 % of Tier one capital at the time of purchase. Treasury Stock The Company records common stock purchased for treasury at cost. At the date of subsequent reissue, the treasury stock account is reduced by the cost of such stock on the first-in, first-out basis. Transfers and Servicing of Financial Assets Transfers of an entire financial asset, a group of entire financial assets or a participating interest in an entire financial asset are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right to pledge or exchange the transferred assets and (3) the Company does not maintain effective control over the transferred assets. During the normal course of business, the Company may transfer whole loans or a portion of a financial asset, such as a participation loan or the government guaranteed portion of a loan. In order to be eligible for sales treatment, the transfer of the portion of the loan must meet the criteria of a participating interest. If it does not meet the criteria of a participating interest, the transfer will be accounted for as a secured borrowing. In order to meet the criteria for a participating interest, all cash flows from the loan must be divided proportionately, the rights of each loan holder must have the same priority, the loan holders must have no recourse to the transferor other than standard representations and warranties and no loan holder has the right to pledge or exchange the entire loan. 55 The Company services mortgage loans for others. Loan servicing fee income is reported in the consolidated statements of loss as loan servicing fee income. The fees are based on a contractual percentage of the outstanding principal and are recorded as income when earned. Late fees and ancillary fees related to loan servicing are not material. Mortgage servicing rights (“MSR”) are initially recorded as an asset and measured at fair value when loans are sold to third parties with servicing rights retained. MSR are initially recorded at fair value by using a discounted cash flow model to calculate the present value of estimated future net servicing income. The Company’s MSR accounted for under the fair value method are carried on the balance sheet at fair value with changes in fair value recorded in loan servicing fee income in the period in which the change occurs. Changes in the fair value of MSR are primarily due to changes in valuation inputs, assumptions and the collection and realization of expected cash flows. Customer List Intangible On August 17, 2021, the Bank entered into a definitive agreement with an investment advisory and wealth management firm (the “seller”) to purchase certain of its client accounts and client relationships for a final adjusted purchase price of $ 324,000 (included in other assets at December 31, 2025 and 2024), of which $ 172,000 was paid at closing. Each client account was assigned a value, and as each client transferred to the Bank, 85 % of this value was paid to the seller. Once it was determined that the transition of client accounts was completed, the final purchase price was adjusted and a final payment made to the seller. As of December 31, 2025 and 2024, approximately $ 28.0 million and $ 28.7 million of purchased client accounts are included in total assets under management, respectively. The client accounts purchased are recorded as a customer list intangible asset. Identifiable intangible assets that are subject to amortization will be reviewed for impairment, at least annually, based on their fair value. Any impairment will be recognized as a charge to earnings and the adjusted carrying amount of the intangible asset will become its new accounting basis. The remaining useful life of the intangible asset will also be evaluated each reporting period to determine whether events and circumstances warrant a revision to the remaining period of amortization. The Company is amortizing the customer list intangible on a straight-line basis over a ten-year period. During the years ended December 31, 2025 and 2024, $ 32,000 of amortization expense was recorded in other expense. Revenue Recognition Accounting Standards Codification (“ASC”) section 606, Revenue from Contracts with Customers (“ASC 606”), establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts to provide goods or services to customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. The majority of our revenue-generating transactions are not subject to ASC 606, including revenue generated from financial instruments, such as our loans, letters of credit and investments securities, as well as revenue related to our mortgage servicing activities and bank-owned life insurance, as these activities are subject to other GAAP discussed elsewhere within our disclosures. Descriptions of our revenue-generating activities that are within the scope of ASC 606 and which are presented in our income statements as components of non-interest income are as follows: • Customer service fees—these represent general service fees for monthly account maintenance and activity- or transaction- based fees and consist of transaction-based revenue, time-based revenue (service period), item-based revenue or some other individual attribute-based revenue. Revenue is recognized when our performance obligation is completed, which is generally monthly for account maintenance services or when a transaction has been completed (such as a wire transfer, debit card transaction or ATM withdrawal). Payment for such performance obligations are generally received at the time the performance obligations are satisfied. • Investment service fees—these represent fees for investment advisory services, which are generally based on the market values of assets under management, and commissions earned on individual investment and insurance products purchased by clients of FSB Wealth Management. Revenue is recognized when a performance obligation is completed, which is generally monthly for investment advisory services or when an investment product is purchased. Payment for such performance obligations is generally received in the month following the time the performance obligations are satisfied. Advertising Expense Advertising costs are expensed as incurred and recorded within marketing expense. Employee Stock Ownership Plan The Company maintains the First Seacoast Bank Employee Stock Ownership Plan (“ESOP”) to provide eligible employees of the company the opportunity to own company common stock. The ESOP is a tax-qualified retirement plan for the benefit of company employees. The cost of shares issued to the ESOP, but not yet allocated to participants, is shown as a 56 reduction of stockholders' equity. Compensation expense is based on the market price of shares as they are committed to be released to participant accounts. Defined Contribution Plan During the years ended December 31, 2025 and 2024, the Company sponsored a 401(k) defined contribution plan for substantially all employees pursuant to which employees of the Company could elect to make contributions to the plan subject to Internal Revenue Service limits. The Company also made and expensed matching and profit-sharing contributions to eligible participants in accordance with plan provisions. Stock Based Compensation Effective May 30, 2024, the Company adopted the First Seacoast Bancorp 2024 Equity Incentive Plan (the “2024 Plan”). The 2024 Plan provides for the granting of incentive and non-statutory stock options to purchase shares of common stock or the granting of shares of restricted stock awards and restricted stock units. The 2024 Plan authorizes the issuance or delivery to participants of up to 392,700 converted shares of common stock. Of this number, the maximum number of shares of common stock that may be issued pursuant to the exercise of stock options is 280,500 shares, and the maximum number of shares of common stock that may be issued as restricted stock awards or restricted stock units is 112,200 shares. Effective May 27, 2021, the Company adopted the First Seacoast Bancorp 2021 Equity Incentive Plan (the “2021 Plan”). The 2021 Plan provides for the granting of incentive and non-statutory stock options to purchase shares of common stock or the granting of shares of restricted stock awards and restricted stock units. The 2021 Plan authorizes the issuance or delivery to participants of up to 348,800 converted shares of common stock (adjusted for the second step conversion transaction). Of this number, the maximum number of shares of common stock that may be issued pursuant to the exercise of stock options is 249,144 shares (adjusted for the second step conversion transaction), and the maximum number of shares of common stock that may be issued as restricted stock awards or restricted stock units is 99,656 shares (adjusted for the second step conversion transaction). The Company recognizes stock-based compensation based on the grant-date fair value of the award adjusted for actual forfeitures. The Company will value share-based stock option awards as granted using the Black-Scholes option-pricing model. The Company recognizes compensation expense for its awards on a straight-line basis over the requisite service period for the entire award (straight-line attribution method), ensuring that the amount of compensation cost recognized at any date at least equals the portion of the grant-date fair value of the award that is vested at that time. Supplemental Executive Retirement Plans The Company maintains nonqualified supplemental executive benefit agreements with certain directors and its current and former Presidents and certain officers. The agreements provide supplemental retirement benefits payable in installments over a period of years upon retirement or death and for the crediting to a liability account a fixed amount of compensation, which earns interest at a rate determined in the agreement. The Company recognizes the cost of providing these benefits over the time period the individuals render service through the retirement date. At each measurement date, the aggregate amount accrued equals the then present value of the benefits expected to be provided to the individual in exchange for the individual’s service to that date. Leases The Company’s lease arrangements consist of operating and finance leases; however, the majority of the leases have been classified as non-cancellable operating leases and are primarily for real estate and equipment leases with remaining lease terms of up to 15 years. The Company accounts for leases under ASC Topic 842 – Leases (Topic 842) – and recognizes its operating leases on its consolidated balance sheets by recording a net lease liability, representing the Company’s legal obligation to make these lease payments, and a Right-Of-Use (“ROU”) asset, representing the Company’s legal right to use the leased assets. The Company, by policy, does not include renewal options for leases as part of its ROU asset and lease liabilities unless they are deemed reasonably certain to exercise. The Company does not have any sub-lease agreements. The Company determines whether a contract contains a lease based on whether a contract, or a part of a contract, conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The discount rate is either implicit in the lease or, when a rate cannot be readily determined, the Company’s incremental borrowing rate is used. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term (see Note 13 for more information). Income Taxes Provisions for income taxes are based on taxes currently payable or refundable and deferred income taxes on temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements. 57 Deferred tax assets and liabilities are measured using enacted tax rates expected to 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 in income in the period that includes the enactment date. Assets and liabilities are established for uncertain tax positions taken or positions expected to be taken in income tax returns when such positions are judged to not meet the “more-likely-than-not” threshold, based upon the technical merits of the position. Estimated interest and penalties, if applicable, related to uncertain tax positions are included as a component of provision for income taxes. The Company has evaluated the positions taken on its tax returns filed and the potential impact on its tax status as of December 31, 2025. The Company has concluded that no uncertain tax positions exist at December 31, 2025. Judgment is required in determining the provision for income taxes, deferred tax assets and liabilities and any necessary valuation allowance recorded against net deferred tax assets. The process involves summarizing temporary differences resulting from the different treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities which are included within the consolidated balance sheets. The Company assesses the likelihood that deferred tax assets will be recovered from future taxable income and, to the extent the Company believes recovery is not likely, a valuation allowance is established. To the extent that the Company establishes or adjusts a valuation allowance in a period, an expense or benefit is recorded within the tax provision in the consolidated statements of loss. Comprehensive Income (Loss) Accounting principles generally require that recognized revenue, expenses, gains and losses be included in net loss. Although certain changes in assets and liabilities, such as unrealized gains and losses on securities available-for-sale, are reported as a separate component of the stockholders’ equity section of the consolidated balance sheets, such items, along with net loss, are components of comprehensive income (loss). The Company also records changes in the fair value of interest rate derivatives used in its cash flow hedging activities, net of deferred income tax, in comprehensive income (loss). Loss Per Share Basic loss per share represents loss allocable to common stockholders divided by the weighted-average number of common shares outstanding during the period. Diluted loss per share is computed in a manner similar to that of basic loss per share since the weighted-average number of common shares outstanding is not adjusted to include the number of incremental common shares (computed using the treasury method) that would have been outstanding if all potentially dilutive common stock equivalents were issued during the period in periods where a net loss was recognized. Unallocated ESOP shares are not deemed outstanding for loss per share calculations. Securities that could potentially dilute basic earnings per common share in the future (i.e., unvested restricted stock) were not included in the computation of diluted earnings per common share because to do so would have been antidilutive for 2025 and 2024. All unvested stock based compensation awards exclude the right to receive non-forfeitable dividends and are considered nonparticipating securities and exclude the right to participate with common stock in undistributed earnings for purposes of computing loss per share. Derivative Instruments and Hedging Activities Derivatives are recognized as either assets or liabilities on the balance sheet and are measured at fair value. The accounting for changes in the fair value of such derivatives depends on the intended use of the derivative and resulting designation. For derivatives designated as cash flow hedges, the gain or loss on the derivative is reported in other comprehensive income (loss) and is reclassified into earnings in the same periods during which the hedged transaction affects earnings. For derivatives designated and that qualify as fair value hedges, the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in interest income. Changes in the fair value of derivatives that do not qualify for hedge accounting are reported currently in earnings, as non-interest income. The Company formally assesses the effectiveness of each hedging transaction at inception, and on an on- going basis. When it is determined that the contract is no longer highly effective, the Company discontinues hedge accounting prospectively. This documentation includes linking fair value or cash flow hedges to specific assets and liabilities on the balance sheet or to specific firm commitments or forecasted transactions. When hedge accounting is discontinued, subsequent changes in fair value of the derivative are recorded as non-interest income. When a fair value hedge is discontinued, the hedged asset or liability is no longer adjusted for changes in fair value and the existing basis adjustment is amortized or accreted over the remaining life of the asset or liability. When a cash flow hedge is discontinued but the hedged cash flows or forecasted transactions are still expected to occur, gains or losses that were accumulated in other comprehensive income are amortized into earnings over the same periods in which the hedged transactions will affect earnings. 58 The Company is exposed to losses if a counterparty fails to make its payments under a contract in which the Company is in the net receiving position. The Company anticipates that the counterparties will be able to fully satisfy their obligations under the agreements. All the contracts to which the Company is a party settle monthly or quarterly. Risks and Uncertainties Most of the Company’s business activity is with customers located within the New Hampshire and southern Maine Seacoast region. The Company's commercial real estate loans are secured by a variety of properties in its primary market area, including retail spaces, distribution centers, office buildings, manufacturing and warehouse properties, convenience stores and other local businesses, without any material concentrations in property type. The Company has limited exposure to non-owner occupied office space. Multi-family real estate loans are secured by properties consisting of five or more rental units in the Company's market area, including apartment buildings and student housing. Segment Reporting The Company has one reportable segment, “Banking Services.” All of the Company’s activities are interrelated, and each activity is dependent and assessed based on how each of the activities of the Company supports the others. For example, lending is dependent upon the ability of the Company to fund itself with deposits and other borrowings and manage interest rate and credit risk. Accordingly, all significant operating decisions are based upon analysis of the Company as one segment or unit. The Company adopted ASU 2023-07, “Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures," on January 1, 2024 , which provides updated guidance for segment reporting. The Company has determined that all of its banking services meet the aggregation criteria of ASC 280, Segment Reporting , as its current operating model is structured whereby the Bank serves a similar base of customers who utilize a company-wide offering of similar products and services managed through similar processes that are collectively reviewed by the Company’s Chief Executive Officer , who has been identified as the chief operating decision maker (“CODM”). The CODM regularly assesses performance of the aggregated single operating and reporting segment and decides how to allocate resources based upon net income or loss calculated on the same basis as net income or loss is reported in the Company’s consolidated statements of loss and other comprehensive income (loss). The CODM is also regularly provided with the expense information at a level consistent with that disclosed in the Company’s consolidated statements of loss and other comprehensive income (loss). 3. Recent Accounting Pronouncements Recent Accounting Pronouncements Yet To Be Adopted The Company considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have an immaterial impact on the Company’s consolidated financial statements. In November 2025, the FASB issued ASU 2025-08, “Financial Instruments - Credit Losses (Topic 326): Purchased Loans.” ASU 2025-08 amends the guidance in ASC 326 on the accounting for certain purchased loans. Under the ASU, entities must account for acquired loans that meet certain criteria at acquisition (“purchased seasoned loans”) by recognizing the loan at its purchase price plus an allowance for expected credit losses (i.e., the gross-up approach). The ASU’s amendments align the accounting for purchased seasoned loans with the treatment of financial assets purchased with more-than-insignificant credit deterioration since origination (“PCD assets”). ASU 2025-08 is effective for annual reporting periods beginning after December 15, 2026 on a prospective basis. Early adoption is also permitted. We are currently evaluating the effect this standard will have on our consolidated financial statements. In November 2024, the FASB issued ASU 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures.” ASU 2024-03 requires disaggregated disclosure of income statement expenses for public business entities. ASU 2024-03 requires new financial statement disclosures in tabular format, disaggregating information about prescribed categories underlying any relevant income statement expense caption. The prescribed categories include, among other things, employee compensation, depreciation, and intangible asset amortization. Additionally, entities must disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026 on a prospective basis. Retrospective application for all periods presented is permitted. Early adoption is also permitted. We are currently evaluating the effect this standard will have on our disclosures. Recently Adopted Accounting Pronouncements In March 2024, the FASB issued ASU 2024-02, “Codification Improvements,” which amends the Codification to remove references to various concepts statements and impacts a variety of topics in the Codification. The amendments apply to all reporting entities within the scope of the affected accounting guidance, but in most instances the references removed are 59 extraneous and not required to understand or apply the guidance. Generally, the amendments in ASU 2024-02 are not intended to result in significant accounting changes for most entities. ASU 2024-02 was effective January 1, 2025 and did not have a material impact on the Company's consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, " Income Taxes- Improvements to Income Tax Disclosures" , which requires enhancements and further transparency to various income tax disclosures, most notably the tax rate reconciliation and income taxes paid. ASU 2023-09 became effective for annual periods beginning after December 15, 2024 on a prospective basis. Retrospective application for all periods presented is permitted. Early adoption was also permitted. ASU 2023-09 did not have a material impact on the Company's consolidated financial statements. 4. Securities Available-for-Sale The amortized cost and fair value of securities available-for-sale, and the corresponding amounts of gross unrealized gains and losses, are as follows as of December 31, 2025 and 2024: December 31, 2025 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (Dollars in thousands) U.S. Government-sponsored enterprises obligations $ 1,615 $ — $ ( 162 ) $ 1,453 U.S. Government agency small business administration pools guaranteed by SBA 11,272 17 ( 716 ) 10,573 Collateralized mortgage obligations issued by the FHLMC, FNMA and GNMA 34,765 349 ( 372 ) 34,742 Residential mortgage-backed securities 66,725 988 ( 3,218 ) 64,495 Municipal bonds 32,554 37 ( 3,322 ) 29,269 Corporate debt 6,190 — ( 13 ) 6,177 Corporate subordinated debt 5,866 92 ( 261 ) 5,697 $ 158,987 $ 1,483 $ ( 8,064 ) $ 152,406 December 31, 2024 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (Dollars in thousands) U.S. Government-sponsored enterprises obligations $ 1,642 $ — $ ( 255 ) $ 1,387 U.S. Government agency small business administration pools guaranteed by SBA 14,011 16 ( 902 ) 13,125 Collateralized mortgage obligations issued by the FHLMC, FNMA and GNMA 19,924 34 ( 596 ) 19,362 Residential mortgage-backed securities 52,452 392 ( 4,382 ) 48,462 Municipal bonds 32,960 74 ( 3,502 ) 29,532 Corporate debt 500 — ( 16 ) 484 Corporate subordinated debt 8,325 163 ( 623 ) 7,865 $ 129,814 $ 679 $ ( 10,276 ) $ 120,217 60 The amortized cost and fair values of available-for-sale securities at December 31, 2025 by contractual maturity are shown below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. December 31, 2025 Amortized Cost Fair Value (Dollars in thousands) Due in one year or less $ 5,690 $ 5,688 Due after one year through five years 4,047 3,940 Due after five years through ten years 5,533 5,230 Due after ten years 30,955 27,738 Total U.S. Government-sponsored enterprises obligations, municipal bonds, corporate debt and corporate subordinated debt 46,225 42,596 U.S. Government agency small business pools guaranteed by SBA (1) 11,272 10,573 Collateralized mortgage obligations issued by the FHLMC, FNMA, and GNMA (1) 34,765 34,742 Residential mortgage-backed securities (1) 66,725 64,495 Total $ 158,987 $ 152,406 (1) Actual maturities for these debt securities are dependent upon the interest rate environment and prepayments on the underlying loans. Proceeds from sales, maturities, principal payments received and gross realized gains and losses on available-for-sale securities were as follows for the years ended December 31: December 31, 2025 2024 (Dollars in thousands) Proceeds from principal payments received on securities available-for-sale $ 18,109 $ 10,741 Proceeds from sales, calls and maturities received on securities available-for-sale 3,000 25,482 Gross realized gains — 550 Gross realized losses — ( 543 ) Net realized gains $ — $ 7 61 The following is a summary of gross unrealized losses and fair value for those investments with unrealized losses, aggregated by investment category and length of time the individual securities have been in a continuous unrealized loss position, at December 31, 2025 and 2024. Less than 12 Months More than 12 Months Total Number of Securities Fair Value Unrealized Losses Number of Securities Fair Value Unrealized Losses Fair Value Unrealized Losses (Dollars in thousands) December 31, 2025 U.S. Government sponsored enterprises obligations — $ — $ — 3 $ 1,453 $ ( 162 ) $ 1,453 $ ( 162 ) U.S. Government agency small business administration pools guaranteed by SBA 1 593 ( 11 ) 12 8,211 ( 705 ) 8,804 ( 716 ) Collateralized mortgage obligations issued by the FHLMC, FNMA and GNMA 1 818 ( 24 ) 9 10,434 ( 348 ) 11,252 ( 372 ) Residential mortgage backed securities 4 9,805 ( 148 ) 29 17,128 ( 3,070 ) 26,933 ( 3,218 ) Municipal bonds — — — 36 26,953 ( 3,322 ) 26,953 ( 3,322 ) Corporate debt 2 3,705 ( 2 ) 1 489 ( 11 ) 4,194 ( 13 ) Corporate subordinated debt — — — 3 3,239 ( 261 ) 3,239 ( 261 ) 8 $ 14,921 $ ( 185 ) 93 $ 67,907 $ ( 7,879 ) $ 82,828 $ ( 8,064 ) December 31, 2024 U.S. Government sponsored enterprises obligations — $ — $ — 3 $ 1,387 $ ( 255 ) $ 1,387 $ ( 255 ) U.S. Government agency small business administration pools guaranteed by SBA 5 4,245 ( 28 ) 8 6,224 ( 874 ) 10,469 ( 902 ) Collateralized mortgage obligations issued by the FHLMC, FNMA and GNMA 7 11,913 ( 126 ) 4 2,256 ( 470 ) 14,169 ( 596 ) Residential mortgage backed securities 20 22,395 ( 422 ) 24 14,485 ( 3,960 ) 36,880 ( 4,382 ) Municipal bonds 3 825 ( 12 ) 36 27,369 ( 3,490 ) 28,194 ( 3,502 ) Corporate debt — — — 1 484 ( 16 ) 484 ( 16 ) Corporate subordinated debt — — — 5 4,887 ( 623 ) 4,887 ( 623 ) 35 $ 39,378 $ ( 588 ) 81 $ 57,092 $ ( 9,688 ) $ 96,470 $ ( 10,276 ) Management evaluates securities available-for-sale in unrealized loss positions to determine whether the impairment is due to credit-related factors or noncredit-related factors. Consideration is given to (1) the extent to which the fair value is less than cost, (2) the financial condition and near-term prospects of the issuer, and (3) the intent and ability of the Company to retain its investment in the security for a period of time sufficient to allow for any anticipated recovery in fair value. At December 31, 2025 and 2024, the Company had 101 and 116 securities available-for-sale in an unrealized loss position without an allowance for credit losses, respectively. Management does not have the intent to sell any of these securities and believes that it is more likely than not that the Company will not have to sell any such securities before a recovery of cost. The fair value is expected to recover as the securities approach their maturity date or repricing date or if market yields for such investments decline. Accordingly, as of December 31, 2025, management believes that the unrealized losses detailed in the previous tables are due to noncredit-related factors, including changes in market interest rates and other market conditions, and therefore the Company carried no allowance for credit losses on securities available-for-sale as of December 31, 2025 and 2024. There was no accrued interest reversed against interest income for the years ended December 31, 2025 62 and 2024. Accrued interest receivable on available-for-sale securities totaled $ 837,000 and $ 800,000 at December 31, 2025 and 2024, respectively, and is excluded from the estimate of credit losses. As of December 31, 2025 and 2024, there were no holdings of securities of any issuer, other than the SBA, FHLMC, GNMA and FNMA, whose aggregate carrying value exceeded 10% of stockholders’ equity. 5. Loans and Allowance for Credit Losses on Loans The Company’s lending activities are primarily conducted in and around Dover, New Hampshire and in the areas surrounding its branches. The Company originates commercial real estate loans, multifamily 5+ dwelling unit loans, commercial and industrial loans, acquisition, development and land loans, one- to four-family residential loans, home equity loans and lines of credit and consumer loans. Most loans originated by the Company are collateralized by real estate. The ability and willingness of real estate, commercial and construction loan borrowers to honor their repayment commitments is generally dependent on the health of the real estate sector in the borrowers’ geographic area and the general economy. Loans consisted of the following at December 31: 2025 2024 (Dollars in thousands) Commercial real estate (CRE) $ 80,588 $ 86,020 Multifamily (MF) 4,839 5,752 Commercial and industrial (C+I) 22,541 23,711 Acquisition, development, and land (ADL) 12,875 14,946 1-4 family residential (RES) 265,249 275,235 Home equity loans and lines of credit (HELOC) 20,652 20,908 Consumer (CON) 12,730 12,395 Total loans 419,474 438,967 Allowance for credit losses on loans ( 3,427 ) ( 3,486 ) Total loans, net $ 416,047 $ 435,481 The Company elected to include deferred loan originations costs, net and to exclude accrued interest receivable from the amortized cost basis of loans disclosed throughout this footnote. As of December 31, 2025 and 2024, accrued interest receivable for loans totaled $ 1.3 million and is included in the “accrued interest receivable” line item on the Company’s consolidated balance sheets. Changes in the ACL for the year ended December 31, 2025 and 2024, by portfolio segment, are summarized as follows: (Dollars in thousands) CRE MF C+I ADL RES HELOC CON Unallocated Total Balance, December 31, 2024 $ 710 $ 59 $ 233 $ 87 $ 1,612 $ 214 $ 439 $ 132 $ 3,486 (Release) provision for credit losses on loans ( 92 ) ( 11 ) ( 50 ) 1 ( 124 ) ( 10 ) 169 57 ( 60 ) Charge-offs — — — — — — — — — Recoveries — — — — — — 1 — 1 Balance, December 31, 2025 $ 618 $ 48 $ 183 $ 88 $ 1,488 $ 204 $ 609 $ 189 $ 3,427 Balance, December 31, 2023 $ 830 $ 76 $ 236 $ 105 $ 1,601 $ 156 $ 357 $ 29 $ 3,390 (Release) provision for credit losses on loans ( 120 ) ( 17 ) ( 3 ) ( 18 ) 11 58 106 103 120 Charge-offs — — — — — — ( 27 ) — ( 27 ) Recoveries — — — — — — 3 — 3 Balance, December 31, 2024 $ 710 $ 59 $ 233 $ 87 $ 1,612 $ 214 $ 439 $ 132 $ 3,486 The change in the allowance for credit losses during the years ended December 31, 2025 and 2024 was primarily a result of the changes in loan balances and off-balance sheet credit exposures. The fo llowing represents the composition of the Company's release of credit losses for the year ended December 31: 2025 2024 (Dollars in thousands) Loans $ ( 60 ) $ 120 Off-balance sheet credit exposures 59 ( 192 ) Total release of credit losses $ ( 1 ) $ ( 72 ) 63 The following is an aged analysis of past due loans by portfolio segment as of December 31, 2025: (Dollars in thousands) 30-59 Days 60-89 Days 90 + Days Total Past Due Current Total Loans Non-Accrual Loans CRE $ — $ — $ — $ — $ 80,588 $ 80,588 $ — MF — — — — 4,839 4,839 — C+I — — — — 22,541 22,541 — ADL — — — — 12,875 12,875 — RES 262 — — 262 264,987 265,249 361 HELOC 136 — — 136 20,516 20,652 — CON 22 — 117 139 12,591 12,730 117 $ 420 $ — $ 117 $ 537 $ 418,937 $ 419,474 $ 478 The following is an aged analysis of past due loans by portfolio segment as of December 31, 2024: (Dollars in thousands) 30-59 Days 60-89 Days 90 + Days Total Past Due Current Total Loans Non-Accrual Loans CRE $ — $ — $ — $ — $ 86,020 $ 86,020 $ — MF — — — — 5,752 5,752 — C+I — — — — 23,711 23,711 — ADL — — — — 14,946 14,946 — RES — — — — 275,235 275,235 — HELOC — — — — 20,908 20,908 — CON — — — — 12,395 12,395 — $ — $ — $ — $ — $ 438,967 $ 438,967 $ — Interest income recognized on non-accrual loans during the years ended December 31, 2025 and 2024 was $- 0 -. There were no loans past due over 90 days still accruing interest at December 31, 2025 and 2024. There were no loans collateralized by residential real estate property in the process of foreclosure at December 31, 2025 and 2024. There were no loans modified for borrowers experiencing financial difficulty during the years ended December 31, 2025 and 2024. An assessment of whether a borrower is experiencing financial difficulty is made on the date of a modification, if applicable. The ACL incorporates an estimate of lifetime expected credit losses and is recorded on each asset upon origination. Because the effect of most modifications made to borrowers experiencing financial difficulty would already be included in the ACL as a result of the measurement methodologies used to estimate the allowance, a change in the ACL is generally not recorded upon modification. Credit Quality Information The Company utilizes a ten-grade internal loan rating system for its commercial real estate, multifamily, commercial and industrial and acquisition, development and land loans. One- to four-family residential real estate, home equity loans and lines of credit and consumer loans are considered “pass” rated loans until they become delinquent. Once delinquent, loans can be rated an 8, 9 or 10 as applicable. Loans rated 1 through 6: Loans in these categories are considered “pass” rated loans with low to average risk. Loans rated 7: Loans in this category are considered “special mention.” These loans are starting to show signs of potential weakness and are being closely monitored by management. Loans rated 8: Loans in this category are considered “substandard.” Generally, a loan is considered substandard if it is inadequately protected by the current net worth and paying capacity of the obligors and/or the collateral pledged. There is a distinct possibility that the Bank will sustain some loss if the weakness is not corrected. Loans rated 9: Loans in this category are considered “doubtful.” Loans classified as doubtful have all the weaknesses inherent in those classified substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, highly questionable and improbable. Loans rated 10: Loans in this category are considered uncollectible (“loss”) and of such little value that their continuance as loans is not warranted and should be charged off. On an annual basis, or more often if needed, the Company formally reviews the ratings on all commercial real estate, multifamily, commercial and industrial, and acquisition, development and land loans. On a periodic basis, the Company engages an independent third party to review a significant portion of loans within these segments and to assess the credit risk management practices of its commercial lending department. Management uses the results of these reviews as part of its annual review process and overall credit risk administration. 64 On a quarterly basis, the Company formally reviews the ratings on all one- to four-family residential real estate, home equity loans and lines of credit and consumer loans if they have become delinquent. Criteria used to determine ratings consist of loan-to-value ratios and days delinquent. Based upon the most recent analysis performed, the risk category of loans by portfolio segment by vintage, reported under the ASC 326 methodology, was as follows as of December 31, 2025 and 2024 (gross charge-offs by vintage are not material for disclosure for the years presented): December 31, 2025: (Dollars in thousands) 2025 2024 2023 2022 2021 Prior Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Total CRE: Risk rating: Pass $ 6,865 $ 6,174 $ 6,447 $ 12,479 $ 8,278 $ 16,532 $ 23,813 $ — $ 80,588 Special mention — — — — — — — — — Substandard — — — — — — — — — Total CRE 6,865 6,174 6,447 12,479 8,278 16,532 23,813 — 80,588 MF: Risk rating: Pass 328 — 1,870 110 587 1,709 235 — 4,839 Special mention — — — — — — — — — Substandard — — — — — — — — — Total MF 328 — 1,870 110 587 1,709 235 — 4,839 C+I: Risk rating: Pass 3,812 1,707 1,719 3,247 694 1,673 9,689 — 22,541 Special mention — — — — — — — — — Substandard — — — — — — — — — Total C+I 3,812 1,707 1,719 3,247 694 1,673 9,689 — 22,541 ADL: Risk rating: Pass 5,776 1,790 4,940 140 229 — — — 12,875 Special mention — — — — — — — — — Substandard — — — — — — — — — Total ADL 5,776 1,790 4,940 140 229 — — — 12,875 RES: Risk rating: Pass 12,146 15,708 23,532 39,356 60,891 113,255 — — 264,888 Special mention — — — — — — — — — Substandard — — — — — 361 — — 361 Total RES 12,146 15,708 23,532 39,356 60,891 113,616 — — 265,249 HELOC: Risk rating: Pass — — — — — — 20,290 362 20,652 Special mention — — — — — — — — — Substandard — — — — — — — — — Total HELOC — — — — — — 20,290 362 20,652 CON: Risk rating: Pass 2,633 3,284 1,720 2,228 1,418 1,330 — — 12,613 Special mention — — — — — — — — — Substandard 117 — — — — — — — 117 Total CON 2,750 3,284 1,720 2,228 1,418 1,330 — — 12,730 Total $ 31,677 $ 28,663 $ 40,228 $ 57,560 $ 72,097 $ 134,860 $ 54,027 $ 362 $ 419,474 65 December 31, 2024: (Dollars in thousands) 2024 2023 2022 2021 2020 Prior Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Total CRE: Risk rating: Pass $ 7,613 $ 6,602 $ 13,078 $ 10,161 $ 1,822 $ 17,732 $ 29,012 $ — $ 86,020 Special mention — — — — — — — — — Substandard — — — — — — — — — Total CRE 7,613 6,602 13,078 10,161 1,822 17,732 29,012 — 86,020 MF: Risk rating: Pass — 1,925 128 623 1,032 1,755 289 — 5,752 Special mention — — — — — — — — — Substandard — — — — — — — — — Total MF — 1,925 128 623 1,032 1,755 289 — 5,752 C+I: Risk rating: Pass 4,226 5,011 4,736 1,635 2,341 2,471 2,315 802 23,537 Special mention — — — — — 174 — — 174 Substandard — — — — — — — — — Total C+I 4,226 5,011 4,736 1,635 2,341 2,645 2,315 802 23,711 ADL: Risk rating: Pass 5,213 9,202 219 312 — — — — 14,946 Special mention — — — — — — — — — Substandard — — — — — — — — — Total ADL 5,213 9,202 219 312 — — — — 14,946 RES: Risk rating: Pass 15,675 25,144 42,750 64,686 44,838 82,142 — — 275,235 Special mention — — — — — — — — — Substandard — — — — — — — — — Total RES 15,675 25,144 42,750 64,686 44,838 82,142 — — 275,235 HELOC: Risk rating: Pass — — — — — — 20,908 — 20,908 Special mention — — — — — — — — — Substandard — — — — — — — — — Total HELOC — — — — — — 20,908 — 20,908 CON: Risk rating: Pass 4,385 2,363 2,557 1,565 1,334 191 — — 12,395 Special mention — — — — — — — — — Substandard — — — — — — — — — Total CON 4,385 2,363 2,557 1,565 1,334 191 — — 12,395 Total $ 37,112 $ 50,247 $ 63,468 $ 78,982 $ 51,367 $ 104,465 $ 52,524 $ 802 $ 438,967 Certain directors and executive officers of the Company and entities in which they have significant ownership interests were customers of the Bank during 2025 and 2024. For the years ended December 31, 2025 and 2024, activity in these loans was as follows: December 31, (Dollars in thousands) 2025 2024 Loans outstanding – beginning of year $ 4,280 $ 5,162 Principal payments ( 691 ) ( 882 ) Advances — — Loans outstanding – end of year $ 3,589 $ 4,280 6. Loan Servicing Loans serviced for others are not included in the accompanying consolidated balance sheets. The unpaid principal balances of such loans were $ 29.2 million and $ 31.3 million at December 31, 2025 and 2024, respectively. Substantially all of these loans were originated by the Bank and sold to third parties on a non-recourse basis with servicing rights retained. These retained servicing rights are recorded as a servicing asset and are initially recorded at fair value (see Note 19 for more information). Changes to the balance of mortgage servicing rights are recorded in loan servicing fee income in the Company’s consolidated statements of loss. 66 The Company’s mortgage servicing activities include: collecting principal, interest and escrow payments from borrowers; making tax and insurance payments on behalf of borrowers; monitoring delinquencies and executing foreclosure proceedings; and accounting for and remitting principal and interest payments to investors. Loan servicing fee income, including late and ancillary fees, was $ 29,000 and $ 48,000 for the years ended December 31, 2025 and 2024, respectively, is recorded as loan servicing fee income in the Company’s consolidated statements of loss. The Company’s residential mortgage investor loan servicing portfolio is primarily comprised of fixed rate loans concentrated in the Company’s market areas. The following summarizes activity in mortgage servicing rights for the years ended December 31, 2025 and 2024. (Dollars in thousands) 2025 2024 Balance, beginning of year $ 305 $ 339 Additions 11 4 Payoffs ( 9 ) ( 7 ) Change in fair value due to change in assumptions ( 50 ) ( 31 ) Balance, end of year $ 257 $ 305 7. Land, Building and Equipment Land, building and equipment consisted of the following at December 31, 2025 and 2024: (Dollars in thousands) 2025 2024 Land $ 101 $ 101 Buildings 324 324 Building & leasehold improvements 339 273 Furniture, fixtures and equipment 4,743 4,689 5,507 5,387 Less: Accumulated depreciation ( 4,918 ) ( 4,633 ) $ 589 $ 754 8. Deposits Deposits consisted of the following at December 31, 2025 and 2024: (Dollars in thousands) 2025 2024 NOW and demand deposits $ 169,326 $ 161,859 Money market deposits 65,852 71,107 Savings deposits 83,660 85,511 Time deposits of $250,000 and greater 23,830 18,822 Time deposits less than $250,000 128,105 116,909 $ 470,773 $ 454,208 There were $ 69.1 million and $ 63.1 million of brokered time deposits which were bifurcated into amounts below the FDIC insurance limit at December 31, 2025 and 2024, respectively. Additionally, there were $ 21.9 million and $ 22.1 million of brokered deposits included in savings deposits at December 31, 2025 and 2024, respectively. Reciprocal deposits were $ 9.1 million and $ 6.0 million at December 31, 2025 and 2024, respectively. Deposits from related parties totaled approximately $ 10.9 million and $ 11.6 million at December 31, 2025 and 2024, respectively. At December 31, 2025, the scheduled maturities of time deposits were as follows: (Dollars in thousands) Total 2026 $ 106,126 2027 35,274 2028 10,194 2029 103 2030 238 $ 151,935 67 9. Borrowings Federal Home Loan Bank (“FHLB”) All borrowings from the FHLB are secured by a blanket security agreement on qualified collateral, principally residential mortgage loans and commercial real estate loans, discounted by a certain percentage, in an aggregate amount greater than or equal to outstanding advances. The Bank’s unused remaining available borrowing capacity at the FHLB was $ 96.6 million and $ 94.0 million at December 31, 2025 and 2024, respectively. At December 31, 2025 and 2024, the Bank had sufficient collateral at the FHLB to support its obligations and was in compliance with the FHLB’s collateral pledging program. A summary of borrowings from the FHLB are as follows: December 31, 2025 Principal Amounts Maturity Dates Interest Rates (Dollars in thousands) $ 50,000 2026 4.38 % to 4.75 % – fixed 718 2028 0.00 % – fixed 400 2029 0.00 % – fixed 200 2030 0.00 % – fixed 430 2031 0.00 % – fixed 560 2032 0.00 % – fixed $ 52,308 December 31, 2024 Principal Amounts Maturity Dates Interest Rates (Dollars in thousands) $ 520 2025 0.00 % – fixed 50,000 2026 4.38 % to 4.75 % – fixed 718 2028 0.00 % – fixed 400 2029 0.00 % – fixed 200 2030 0.00 % – fixed 430 2031 0.00 % – fixed $ 52,268 Included in the above borrowings from the FHLB at December 31, 2025 and 2024 is a $ 25.0 million long-term advance, with an interest rate of 4.75 %, which is callable by the FHLB on January 29, 2026 and quarterly thereafter. Also, included in the above borrowings from the FHLB at December 31, 2025 and 2024 is a $ 25.0 million long-term advance, with an interest rate of 4.38 %, which is callable by the FHLB on March 6, 2026 and quarterly thereafter. As of December 31, 2025 and 2024, borrowings from the FHLB also include $ 2.3 million of advances through the FHLB’s Jobs for New England program where certain qualifying small business loans that create or preserve jobs, expand woman-, minority- or veteran-owned businesses, or otherwise stimulate the economy in New England communities are offered at an interest rate of 0 %. At December 31, 2025 and 2024, the Bank had an overnight line of credit with the FHLB that may be drawn up to $ 3.0 million. Federal Reserve Bank of Boston (“FRB”) The Bank has a secured credit facility with the FRB – BIC Program. The Bank’s unused available borrowing capacity at the FRB was $ 34.1 million and $- 0 - at December 31, 2025 and December 31, 2024, respectively. Advances under the BIC, if any, are collateralized by eligible collateral. During December 2024, the Bank unpledged the collateral previously pledged to the BIC - principally general obligation municipal bonds – with the intention of pledging commercial real estate loans. On January 7, 2025, the Bank completed the collateral eligibility process with the FRB whereby the FHLB agreed to subordinate their interest in our commercial real estate loans up to a maximum of $ 65 million allowing these loans to be pledged to the BIC. The Bank subsequently pledged $ 65.0 million of its commercial real estate loans to the BIC resulting in $ 38.5 million of borrowing capacity under this credit facility as of January 16, 2025. On September 9, 2025, the FHLB agreed to increase the subordination of their interest in our commercial real estate loans up to a maximum of $ 71.7 million allowing these loans to be pledged to the BIC. Correspondent Bank 68 At December 31, 2025 and 2024, the Bank had a $ 2.0 million unsecured Fed Funds borrowing line of credit with a correspondent bank. The entire balance of this credit facility was available at December 31, 2025 and 2024. 10. Income Taxes The current and deferred components of income tax expense consisted of the following for the years ended December 31, 2025 and 2024: December 31, 2025 December 31, 2024 Federal State Total Federal State Total (Dollars in thousands) Current $ 51 $ 119 $ 170 $ 17 $ 107 $ 124 Deferred ( 709 ) ( 99 ) ( 808 ) 291 112 403 $ ( 658 ) $ 20 $ ( 638 ) $ 308 $ 219 $ 527 Income taxes paid, net of refunds received, consisted of the following for the years ended December 31, 2025 and 2024: December 31, 2025 2024 (Dollars in thousands) Federal $ — $ ( 62 ) New Hampshire 120 110 Other — 1 $ 120 $ 49 Total income tax (benefit) expense is different from the amounts computed by applying the U.S. Federal income tax rates in effect to (loss) income before income tax (benefit) expense. The reasons for these differences are as follows for the years ended December 31, 2025 and 2024: December 31, 2025 December 31, 2024 Amount % of Pretax Income Amount % of Pretax Income (Dollars in thousands) Computed “expected” tax benefit $ ( 312 ) ( 21.0 )% $ 3 21.0 % State tax benefit, net of federal tax benefit* ( 204 ) ( 13.8 ) ( 120 ) ( 857.1 ) BOLI income ( 22 ) ( 1.5 ) ( 22 ) ( 157.1 ) Valuation allowance ( 43 ) ( 2.9 ) 736 5,257.1 Income on tax exempt securities ( 52 ) ( 3.5 ) ( 204 ) ( 1,457.1 ) Other ( 5 ) ( 0.3 ) 134 957.5 $ ( 638 ) ( 43.0 )% $ 527 3,764.3 % *State taxes in New Hampshire account for the majority (greater than 50%) of the tax effect in this category. 69 Components of deferred tax assets and liabilities at December 31, 2025 and 2024 are as follows: December 31, 2025 2024 (Dollars in thousands) Deferred tax assets: Allowance for credit losses $ 1,013 $ 1,009 Deferred compensation liabilities 718 644 Contribution carryforward 56 56 State tax credit carryforward 404 310 Depreciation 23 23 Securities available-for-sale 1,783 2,596 Net operating loss carryforward 2,820 2,375 Accrued rent 391 406 Equity compensation 377 195 Other 12 10 Subtotal 7,597 7,624 Less: valuation allowance ( 6,919 ) ( 6,962 ) Total deferred tax assets 678 662 Deferred tax liabilities: Net deferred loan costs ( 778 ) ( 745 ) Mortgage servicing rights ( 69 ) ( 82 ) Total deferred tax liabilities ( 847 ) ( 827 ) Net deferred tax liabilities, included in other liabilities $ ( 169 ) $ ( 165 ) The calculation of the Company’s charitable contribution carryforward deferred tax asset is based upon a carryforward of approximately $ 208,000 of charitable contributions at December 31, 2025 and 2024. During 2024, $ 100,000 of the carryforward was utilized and $ 346,000 expired unused. Of the remaining carryforward, $ 187,000 expires in 2027 and $ 21,000 expires in 2028. As of December 31, 2025 and 2024, it has been determined that it is more likely than not that the benefit from this charitable contribution carryforward will not be realized prior to expiration. As a result, a valuation allowance of $ 56,000 has been provided on this deferred tax asset for the years ended December 31, 2025 and 2024. The ultimate realization of this deferred tax asset is dependent upon the generation of future taxable income. The Internal Revenue Federal Tax Code (the “Code”) limits the charitable contribution deduction in any one year to 10 % of taxable income, computed without regard to charitable contributions, certain special deductions, net operating loss carry backs and capital loss carry backs. However, the Code allows a corporation to carry forward the excess charitable contributions to each of the five immediately succeeding years, subject to a 10% limitation in each of those years. Thus, the Company would have six years in which to utilize the charitable contribution carryforward. The valuation allowance for this net deferred tax asset may be adjusted in the future if estimates of taxable income during the carryforward period are increased. As of December 31, 2025, the Company has a Federal and New Hampshire net operating loss carryforward of $ 10.0 million and $ 12.3 million, respectively. The Federal net operating loss carryforward can be carried forward indefinitely but is limited to 80 % of each subsequent year’s taxable income. The New Hampshire net operating loss carryforward expires in 2032 through 2035 and is also limited to 80 % of each subsequent year’s taxable income. Additionally, as of December 31, 2025, the Company has a New Hampshire Business Enterprise Tax credit carry forward of $ 404,000 that expires in 2029 through 2035. As of December 31, 2025, it has been determined that it is more likely than not that the benefit from these net operating loss and state tax credit carryforwards will not be realized. As a result, a valuation allowance of $ 2.1 million for the Federal net operating loss carryforward, $ 729,000 for the New Hampshire net operating loss carryforward and $ 404,000 for the New Hampshire Business Enterprise Tax credit carry forward has been provided on these deferred tax assets for the year ended December 31, 2025. All other deferred tax assets as of December 31, 2025 have also been reduced by a valuation allowance of $ 3.6 million because management believes that it is more likely than not that the benefit of these deferred tax assets will not be realized. The ultimate realization of these deferred tax assets is dependent upon the generation of future taxable income. The valuation allowance for these net deferred tax assets may be adjusted in the future if estimates of taxable income during the carryforward period are increased. 70 The tax reserve for credit losses at the Company’s base year amounted to approximately $ 2.3 million. If any portion of the reserve is used for purposes other than to absorb credit losses, approximately 150 % of the amount actually used (limited to the amount of the reserve) would be subject to taxation in the year in which used. As the Company intends to use the reserve to only absorb credit losses, a deferred tax liability of approximately $ 630,000 has not been provided. The Company does not have any uncertain tax positions at December 31, 2025 or 2024 which require accrual or disclosure. The Company records interest and penalties as part of income tax expense. No material interest or penalties were recorded for the years ended December 31, 2025 and 2024. The Company’s income tax returns are subject to review and examination by federal and state taxing authorities. The Company is currently open to audit under the applicable statutes of limitations by the Internal Revenue Service for the years ended December 31, 2022 through 2025. The years open to examination by state taxing authorities vary by jurisdiction; no years prior to 2022 are open. 11. Employee Benefits 401(k) Plan During the years ended December 31, 2025 and 2024, the Company sponsored a 401(k) defined contribution plan for substantially all employees pursuant to which employees of the Company could elect to make contributions to the plan subject to Internal Revenue Service limits. The Company also makes matching and profit-sharing contributions to eligible participants in accordance with plan provisions. The Company’s contributions for the years ended December 31, 2025 and 2024 were $ 253,000 and $ 232,000 , respectively. Supplemental Executive Retirement Plans Salary Continuation Plan The Company maintains a nonqualified supplemental retirement plan for its current President and former President. The plan provides supplemental retirement benefits payable in installments over a period of years upon retirement or death. The recorded liability at December 31, 2025 and 2024 relating to this supplemental retirement plan was $ 779,000 and $ 827,000 , respectively. The discount rate used to determine the Company’s obligation was 5.00 % during the years ended December 31, 2025 and 2024. The projected rate of salary increase for its current Chief Executive Officer was 3 % for the years ended December 31, 2025 and 2024. On March 5, 2025, the Bank and its current Chief Executive Officer entered into an amendment that limits the annual benefit to $ 65,000 if there is a separation from service for other than at or following a change of control. Accordingly, as a result of the amendment, the benefit, outside of a change in control, is now fixed and will no longer increase over time. For the years ended December 31, 2025 and 2024, the expense of this salary retirement plan was $ 7,000 and $ 147,000 , respectively. Directors’ Deferred Supplemental Retirement Plan The Company has a supplemental retirement plan for eligible directors that provides for monthly benefits based upon years of service to the Company, subject to certain limitations as set forth in the agreements. The present value of these future payments is being accrued over the estimated period of service. The estimated liability at December 31, 2025 and 2024 relating to this plan was $ 652,000 and $ 611,000 , respectively. The discount rate used to determine the Company’s obligation was 6.25 % during the years ended December 31, 2025 and 2024. For the years ended December 31, 2025 and 2024 the expense of the supplemental retirement plan was $ 71,000 and $ 59,000 , respectively. The Company enacted a “hard freeze” for this supplemental retirement plan as of January 1, 2022. On February 10, 2022, the Bank and the non-employee members of the board of directors of the Bank entered into amendments to the Supplemental Director Retirement Agreements (the “Agreements”) previously entered into by the Bank and the directors. The amendments eliminate the formula for determining the normal annual retirement benefit (previously “ 70 % of Final Base Fee”) and replaces it with a fixed annual benefit of $ 20,000 . The amendments also eliminate the formula for determining the benefit payable on a change in control (previously tied to the normal annual retirement formula with certain imputed increases in the Base Fee) and replacing it with a fixed amount equal to the present value of $ 200,000 . The effect of the amendments is to eliminate the variable and increasing costs associated with the Agreements. Instead, since the normal annual retirement benefit will be a fixed amount, the future costs associated with the Agreements is now more predictable. It is the intention of the Company that no new directors of the Company would enter into similar agreements. Additionally, the Company has a deferred directors’ fee plan which allows members of the board of directors to defer the receipt of fees that otherwise would be paid to them in cash. At December 31, 2025 and 2024, the total deferred directors’ fees amounted to $ 1.2 million and $ 917,000 , respectively. 71 12. Stock Based Compensation Employee Stock Ownership Plan The Company maintains the First Seacoast Bank Employee Stock Ownership Plan (“ESOP”) to provide eligible employees of the Company the opportunity to own Company stock. The ESOP is a tax-qualified retirement plan for the benefit of Company employees. Contributions are allocated to eligible participants on the basis of compensation, subject to federal limits. The Company uses the principal and interest method to determine the release of shares amount. The number of shares committed to be released per year through 2047 is 15,354 . The ESOP funded its purchase of 423,715 shares through a loan from the Company equal to 100 % of the aggregate purchase price of the common stock. The ESOP trustee is repaying the loan principally through the Bank’s contributions to the ESOP over the remaining loan term that matures on December 31, 2047. At December 31, 2025 and 2024, the remaining principal balance on the ESOP debt was $ 4.1 million. Under applicable accounting requirements, the Company records compensation expense for the ESOP equal to fair market value of shares when they are committed to be released from the suspense account to participants’ accounts under the plan. Total compensation expense recognized in connection with the ESOP for the years ended December 31, 2025 and 2024, was $ 174,000 and $ 138,000 , respectively. At December 31, 2025 and 2024, total unearned compensation for the ESOP was $ 3.7 million and $ 3.9 million, respectively. December 31, 2025 2024 Shares held by the ESOP include the following: Allocated 70,572 55,218 Committed to be allocated 15,354 15,354 Unallocated 337,789 353,143 Total 423,715 423,715 The fair value of unallocated shares was approximately $ 4.5 million and $ 3.5 million at December 31, 2025 and 2024, respectively. Equity Incentive Plan Effective May 27, 2021, the Company adopted the First Seacoast Bancorp 2021 Equity Incentive Plan (the “2021 Plan”). The 2021 Plan provides for the granting of incentive and non-statutory stock options to purchase shares of common stock and the granting of shares of restricted stock awards and restricted stock units. The 2021 Plan authorizes the issuance or delivery to participants of up to 348,801 shares of common stock (adjusted for the second step conversion transaction). Of this number, the maximum number of shares of common stock that may be issued pursuant to the exercise of stock options is 249,144 shares (adjusted for the second step conversion transaction), and the maximum number of shares of common stock that may be issued as restricted stock awards or restricted stock units is 99,657 shares (adjusted for the second step conversion transaction). The exercise price of stock options may not be less than the fair market value on the date the stock option is granted. Further, stock options may not be granted with a term that is longer than 10 years. On May 25, 2023, 249,144 incentive and non-statutory stock options to purchase shares of common stock were granted under the 2021 Plan to directors for their services on the board of directors and certain members of management. The Company estimates the grant date fair value of each option using the Black-Scholes option pricing model. The use of the Black-Scholes option pricing model requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected life of the option, risk-free interest rates and expected dividend yields of the common stock. Since it was determined that the Company lacked sufficient historical closing stock prices, the expected volatility assumption was based upon a combination of actual historical volatility combined with the historical volatility developed for comparable companies. Also, since the Company lacked the appropriate historical data, the expected term of the option was calculated using the simplified method. Forfeitures are required to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The estimated grant date fair value of each option is expensed as employee benefits expense ratably over the vesting period. The expense recognized for this grant was $ 234,000 for the years ended December 31, 2025 and 2024, which provided a tax benefit of $ 63,000 . At December 31, 2025 and 2024, total unrecognized compensation expense for this equity incentive plan was $ 96,000 and $ 335,000 with a 0.4 year and 1.4 year weighted average future recognition period, respectively. Effective May 30, 2024, the Company adopted the First Seacoast Bancorp, Inc. 2024 Equity Incentive Plan (the “2024 Plan”). The 2024 Plan provides for the granting of incentive and non-statutory stock options to purchase shares of common stock or the granting of shares of restricted stock awards and restricted stock units. The 2024 Plan authorizes the issuance or delivery to participants of up to 392,700 converted shares of common stock. Of this number, the maximum number of shares 72 of common stock that may be issued pursuant to the exercise of stock options is 280,500 shares, and the maximum number of shares of common stock that may be issued as restricted stock awards or restricted stock units is 112,200 shares. On December 2, 2024, 280,500 incentive and non-statutory stock options to purchase shares of common stock were granted under the 2024 Plan to directors for their services on the board of directors and certain members of management. As noted above, the Company estimates the grant date fair value of each option using the Black-Scholes option pricing model which requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected life of the option, risk-free interest rates and expected dividend yields of the common stock. The expected volatility assumption for this award was based upon the actual historical price volatility of the Company’s common stock. The expected term of the option was calculated using the simplified method since the Company continues to lack the appropriate historical data. Forfeitures are required to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The estimated grant date fair value of each option is expensed as employee benefits expense ratably over the vesting period. The expense recognized for this grant was $ 362,000 and $ 31,000 for the years ended December 31, 2025 and 2024, respectively, which provided a tax benefit of $ 93,000 and $ 8,000 , respectively. At December 31, 2025 and 2024, total unrecognized compensation expense for this equity incentive plan was $ 694,000 and $ 1.0 million, respectively, with a 1.9 and 2.9 year weighted average future recognition period, respectively. The Company has a policy of using shares held as treasury stock to satisfy share option exercises. Currently, the Company has a sufficient number of treasury shares to satisfy expected share option exercises (see Note 17 for more information). 73 A summary of stock options outstanding as of December 31, 2025 and 2024, and changes during the years then ended is presented below: December 31, 2025 Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value Stock options: (In Thousands) Outstanding at beginning of year 529,644 $ 8.72 8.9 $ 684 Granted — — — — Exercised — — — — Forfeited ( 2,750 ) 9.29 — — Outstanding at end of year 526,894 $ 8.72 7.9 $ 2,360 Fully vested and expected to vest 255,346 $ 8.72 7.4 $ 1,144 Exercisable at end of year 255,346 $ 8.72 7.4 $ 1,144 December 31, 2024 Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value Stock options: (In Thousands) Outstanding at beginning of year 249,144 $ 8.06 9.4 $ — Granted 290,500 9.29 — — Exercised — — — — Forfeited ( 10,000 ) 8.06 — — Outstanding at end of year 529,644 $ 8.72 8.9 $ 684 Fully vested and expected to vest 79,715 $ 8.06 8.4 $ 158 Exercisable at end of year 79,715 $ 8.06 8.4 $ 158 On December 2, 2024, 112,200 restricted stock awards were granted under the 2024 Plan to directors for their services on the board of directors and certain members of management at $ 9.29 per share. The total fair value related to the December 2, 2024 grant was $ 1.0 million. These restricted stock awards time-vest over a three year period and have been fair valued as of the date of grant. The holders of restricted stock awards participate fully in the rewards of stock ownership of the Company, including voting rights when granted and dividend rights when vested. For the years ended December 31, 2025 and 2024, the expense recognized for this grant was $ 347,000 and $ 29,000 , respectively, which provided a tax benefit of $ 96,000 and $ 8,000 , respectively. At December 31, 2025 and 2024, total unrecognized compensation expense for this equity incentive plan was $ 666,000 and $ 1.0 million, respectively, with a 1.9 and 2.9 year weighted average future recognition period, respectively. 74 On June 1, 2023, 2,478 restricted stock awards were granted under the 2021 Plan to a certain member of management at $ 7.99 per share. The total fair value related to the June 1, 2023 grant was $ 20,000 . These restricted stock awards time-vest 50 % as of November 18, 2023 and 50 % as of November 18, 2024 and have been fair valued as of the date of grant. On November 18, 2021, 98,850 restricted stock awards (adjusted for the second step conversion transaction) were granted under the 2021 Plan to directors for their services on the board of directors and certain members of management at $ 11.95 per share (adjusted for the second step conversion transaction). The total fair value related to the grant was $ 1.2 million. These restricted stock awards time-vest over a three year period and have been fair valued as of the date of grant. The holders of restricted stock awards participate fully in the rewards of stock ownership of the Company, including voting rights when granted and dividend rights when vested. For the years ended December 31, 2025 and 2024, the expense recognized for these grants was $- 0 - and $ 350,000 , respectively, which provided a tax benefit of $- 0 - and $ 108,000 , respectively. At December 31, 2025 and 2024, total unrecognized compensation expense for this equity incentive plan was $- 0 -. A summary of non-vested restricted shares outstanding as of December 31, 2025 and 2024, and changes during the years then ended is presented below: December 31, 2025 Number of Shares Weighted Average Grant Value Restricted stock: Non-vested at beginning of year 112,200 $ 9.29 Granted — — Vested ( 37,400 ) 9.29 Forfeited — — Non-vested at end of year 74,800 $ 9.29 December 31, 2024 Number of Shares Weighted Average Grant Value Restricted stock: Non-vested at beginning of year 33,629 $ 11.80 Granted 112,200 9.29 Vested ( 33,629 ) 11.80 Forfeited — — Non-vested at end of year 112,200 $ 9.29 13. Leases The Company’s lease arrangements consist of operating and finance leases; however, the majority of the leases have been classified as non-cancellable operating leases and are primarily for real estate and equipment leases with remaining lease terms of up to 15 years. The Company accounts for leases under ASC Topic 842 – Leases (Topic 842) – and recognizes its operating leases on its consolidated balance sheet by recording a net lease liability, representing the Company’s legal obligation to make these lease payments, and a ROU asset, representing the Company’s legal right to use the leased assets. The Company, by policy, does not include renewal options for leases as part of its ROU asset and lease liabilities unless they are deemed reasonably certain to exercise. The Company does not have any sub-lease agreements. The Company determines whether a contract contains a lease based on whether a contract, or a part of a contract, conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The discount rate is either implicit in the lease or, when such a rate cannot be readily determined, the Company’s incremental borrowing rate is used. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term. 75 On June 11, 2024, the Bank entered into and closed on an agreement with a single purchaser for the purchase and sale of four properties formerly owned and operated by the Bank, which included four branches (with an adjacent drive thru) and a parking lot, each adjacent to a sold branch, for an aggregate cash purchase price of $ 7.5 million. Concurrently with the sale-leaseback transaction, the Bank entered into an absolute net lease agreement with the purchaser under which the Bank will lease the properties for an initial term of 15 years with one renewal option of 15 years. The lease agreement includes a 2.5 % annual rent escalation during the initial term and during the renewal term, if exercised. The sale-leaseback transaction resulted in a pre-tax gain of $ 2.5 million which is included in non-interest income in the accompanying consolidated statements of loss. The Company’s operating lease ROU asset and corresponding operating lease liability of $ 5.2 million primarily resulted in an increase in ROU assets and lease liabilities at December 31, 2024 (included in other assets and other liabilities). Additionally, the Company recorded a $ 1.5 million finance lease liability related to this agreement representing the portion of the gain not eligible for immediate recognition. The Company's obligation under this operating lease expires in June 2039 and has future lease payments of $ 8.6 million as of December 31, 2025. Total lease expense for this operating lease was $ 685,000 and $ 292,000 for the years ended December 31, 2025 and 2024, respectively. The Company's obligation under an operating lease related to its leased ATMs expires in August 2030 and has future lease payments of $ 355,000 as of December 31, 2025. Total lease expense under the operating lease related to these ATMs was $ 77,000 for the years ended December 31, 2025 and 2024. The Company's obligation under an operating lease related to a branch not included in the sale-leaseback transaction expires in August 2027 and has future lease payments of $ 72,000 as of December 31, 2025. Total lease expense for this obligation was $ 41,000 and $ 39,000 for the years ended December 31, 2025 and 2024, respectively. This lease agreement contains clauses calling for escalation of minimum lease payments contingent on increases in LIBOR, or a similar replacement index, and the consumer price index. On October 3, 2025, a new lease agreement was signed for this branch which, as of December 31, 2025, was in the process of being relocated to a larger space at the opposite end of the plaza where it operates. The lease agreement became effective as of the date the branch opened to the public, which was January 20, 2026. The Company's obligation under this operating lease expires in January 2046 and contains four renewal options of five years each. The base rent in year one of the lease agreement is $ 21.00 per square foot and increases by $ 1.00 per square foot for each of the first five years. Beginning on the commencement of the sixth year and annually thereafter (including during each renewal period), the base rent will increase by 2.5 % annually. The following tables summarize information related to the Company’s lease portfolio and other supplemental information as of and for the years ended December 31, 2025 and 2024: 2025 2024 Operating Finance Operating Finance (Dollars in thousands) ROU assets $ 5,354 $ — $ 5,648 $ — Lease liabilities 5,354 1,452 5,648 1,509 Lease Term and Discount Rate: Weighted-average remaining lease term (years) 13.10 13.10 13.68 14.42 Weighted-average discount rate (1) 7.87 % 8.12 % 7.82 % 8.12 % (1) A lease implicit rate or incremental borrowing rate is used based on information available at commencement date of lease. (Dollars in thousands) 2025 2024 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 294 $ 202 Operating cash flows from finance lease 57 30 Financing cash flows from finance lease — 1,539 ROU assets obtained in exchange for lease obligations: Operating leases $ — $ 5,263 Net operating lease cost $ 294 $ 202 Finance lease cost: Amortization of right-of-use assets 57 30 Interest on lease liabilities 98 55 Total lease cost $ 449 $ 287 76 Th e total minimum lease payments due in future periods for lease agreements in effect at December 31, 2025 were as follows: As of December 31, 2025 Future Minimum Lease Payments (Dollars in thousands) Operating Finance 2026 $ 670 $ 160 2027 666 164 2028 651 168 2029 665 172 2030 648 176 Thereafter 5,724 1,673 Total minimum lease payments 9,024 2,513 Less: interest ( 3,670 ) ( 1,061 ) Total lease liability $ 5,354 $ 1,452 14. Other Comprehensive Income (Loss) The Company reports certain items as “other comprehensive income (loss)" and reflects total accumulated other comprehensive loss (“AOCI”) in the consolidated financial statements for all years containing elements of other comprehensive income or loss. The following table presents a reconciliation of the changes in the components of other comprehensive income or loss for the dates indicated, including the amount of income tax expense or benefit allocated to each component of other comprehensive income or loss: Year Ended December 31, Reclassification Adjustment 2025 2024 Affected Line Item in Statements of Loss (Dollars in thousands) Gains on sale of securities available-for-sale $ — $ ( 7 ) Securities gains, net Tax effect — 2 Income tax (benefit) expense — ( 5 ) Net loss Net amortization of bond premiums 387 547 Interest on debt securities Tax effect ( 104 ) ( 148 ) Income tax (benefit) expense 283 399 Net loss Net interest income on interest rate swaps 8 ( 30 ) Interest expense on deposits Tax effect ( 2 ) 8 Income tax (benefit) expense 6 ( 22 ) Net loss Total reclassification adjustments $ 289 $ 372 The following tables present the changes in each component of AOCI for the periods indicated: (Dollars in thousands) Net Unrealized Losses on AFS Securities (1) Net Unrealized Losses on Cash Flow Hedges (1) AOCI (1) Balance at December 31, 2023 $ ( 5,944 ) $ — $ ( 5,944 ) Other comprehensive loss before reclassification ( 1,463 ) ( 9 ) ( 1,472 ) Amounts reclassified from AOCI 394 ( 22 ) 372 Other comprehensive loss ( 1,069 ) ( 31 ) ( 1,100 ) Balance at December 31, 2024 $ ( 7,013 ) $ ( 31 ) $ ( 7,044 ) Balance at December 31, 2024 $ ( 7,013 ) $ ( 31 ) $ ( 7,044 ) Other comprehensive income (loss) before reclassification 1,921 ( 5 ) 1,916 Amounts reclassified from AOCI 283 6 289 Other comprehensive income 2,204 1 2,205 Balance at December 31, 2025 $ ( 4,809 ) $ ( 30 ) $ ( 4,839 ) (1) All amounts are net of income tax including a deferred tax valuation allowance equal to the net tax benefit. 77 15. Financial Instruments with Off-Balance Sheet Credit Exposures The Company is party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to originate loans, unadvanced funds on loans and standby letters of credit. The instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated balance sheets. The contract amounts of those instruments reflect the extent of involvement the Company has in particular classes of financial instruments. The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for loan commitments and standby letters of credit is represented by the contractual amounts of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. Commitments to originate loans are agreements to lend to a customer provided there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Bank evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Bank upon extension of credit, is based on management’s credit evaluation of the borrower. Collateral held varies but generally includes secured interests in mortgages. Standby letters of credit are conditional commitments issued by the Bank to guarantee performance by a customer to a third-party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. Notional amounts of financial instruments with off-balance sheet credit risk are approximately as follows as of December 31: 2025 2024 Unadvanced portions of loans $ 52,372 $ 42,883 Commitments to originate loans 11,072 9,333 Standby letters of credit 262 125 The Company records an ACL for off-balance sheet credit exposures that are not unconditionally cancelable through a charge to the release of credit losses on the Company’s consolidated statements of loss. At December 31, 2025 and 2024, the ACL for off-balance sheet credit exposures totaled $ 259,000 and $ 199,000 , respectively, and was included in other liabilities on the Company’s consolidated balance sheets. The provision (release) for credit losses for off-balance sheet credit exposures for the years ended December 31, 2025 and 2024 was $ 59,000 and $( 192,000 ), respectively. In the ordinary course of business, the Company may be subject to various legal proceedings. Management, after consultation with legal counsel, believes that the liabilities, if any, arising from such proceedings will not be material to the consolidated balance sheet or consolidated statements of loss. 78 16. Regulatory Matters The Bank is subject to various regulatory capital requirements administered by the federal banking agencies. Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the table below). As of December 31, 2025, the most recent notification from the Office of the Comptroller of the Currency categorized the Bank, as well capitalized under the regulatory framework, for prompt corrective action. To be categorized as well capitalized, the Bank must maintain minimum capital amounts and ratios as set forth in the following tables. There are no conditions or events since the notification that management believes have changed the Bank’s category. Management believes that, as of December 31, 2025 and 2024, the Bank met all capital adequacy requirements to which it was subject, including the capital conservation buffer, at those dates. The following table presents actual and required capital ratios as of December 31, 2025 and 2024 for the Bank under the Basel Committee on Banking Supervisions capital guidelines for U.S. banks (“Basel III Capital Rules”) as fully phased-in on January 1, 2019. Capital levels required to be considered well capitalized are based upon prompt corrective action regulations, as amended to reflect the changes under the Basel III Capital Rules. Minimum Capital Minimum Capital Required to be Well Minimum Capital Required For Capital Adequacy Plus Capital Conservation Buffer Actual Requirement Capitalized Fully Phased-In (Dollars in thousands) Amount Ratio Amount Ratio Amount Ratio Amount Ratio As of December 31, 2025 Total Capital (to risk- weighted assets) $ 55,405 15.60 % $ 28,420 8.00 % $ 35,526 10.00 % $ 37,302 10.50 % Tier 1 Capital (to risk- weighted assets) 51,719 14.56 21,315 6.00 28,420 8.00 30,197 8.50 Tier 1 Capital (to average assets) 51,719 8.41 24,605 4.00 30,756 5.00 24,605 4.00 Common Equity Tier 1 (to risk-weighted assets) 51,719 14.56 15,987 4.50 23,092 6.50 24,868 7.00 As of December 31, 2024 Total Capital (to risk-weighted assets) $ 55,506 15.55 % $ 28,555 8.00 % $ 35,694 10.00 % $ 37,479 10.50 % Tier 1 Capital (to risk-weighted assets) 51,820 14.52 21,417 6.00 28,555 8.00 30,340 8.50 Tier 1 Capital (to average assets) 51,820 8.69 23,848 4.00 29,809 5.00 23,848 4.00 Common Equity Tier 1 (to risk-weighted assets) 51,820 14.52 16,062 4.50 23,201 6.50 24,986 7.00 17. Treasury Stock As of December 31, 2025 and 2024, the Company held a total of 610,663 and 519,243 shares in its treasury, respectively. Common Stock Repurchases On April 11, 2024, the board of directors of the Company authorized a stock repurchase program for the repurchase of up to 507,707 shares of common stock, representing approximately 10 % of shares then outstanding, which became effective on May 14, 2024. On December 12, 2024, the board of directors of the Company authorized additional stock repurchases, up to 228,858 shares of common stock, under this stock repurchase program. The additional repurchase authorization represents approximately 5 % of pro forma outstanding shares assuming the repurchase of the remaining shares subject to the original authorization. The Company holds repurchased shares in its treasury. As of December 31, 2025, the Company has repurchased 494,379 shares under this stock repurchase program. Equity Incentive Plan A certain member of management elected to surrender 252 shares of a vested restricted stock award on December 2, 2025 in lieu of a cash payment for the tax liabilities associated with the time-vesting of their award. This member of management previously elected to surrender 584 shares of a vested restricted stock award on November 18, 2024 in lieu of a cash payment for the tax liabilities associated with the time-vesting of their award. The Company holds these shares in its treasury. 18. Derivatives and Hedging Activities The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and liabilities and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by 79 interest rates. These derivative financial instruments are reported at fair value in other assets or other liabilities and are not reported on a net basis. Derivatives Designated as Hedging Instruments Cash Flow Hedges of Interest Rate Risk The Company’s objectives in using interest rate derivatives are to add stability to interest income and expense and to manage its exposure to interest rate movements. To accomplish these objectives, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed rate payments or the receipt of fixed rate amounts from a counterparty in exchange for the Company making variable rate payments over the life of the agreements without exchange of the underlying notional amount. On July 12, 2024, the Company entered into a two-year interest rate contract that was designated as fair value hedge utilizing a pay fixed interest rate swap to hedge a portion of its index-based brokered deposits included in savings deposits and its change in fair value attributable to the movement in the one-month SOFR. The carrying amount of the hedged liability located in “savings deposits" includes the savings account balance used to designate hedging relationships in which the hedged items are the stated amount of liabilities anticipated to be outstanding for the designated hedged period. The carrying amount of the savings deposit used in the hedged relationship was $ 21.9 million and $ 22.1 million at December 31, 2025 and 2024, respectively. Under the "portfolio layer" approach, the Company designated a $ 10.0 million notional amount of portfolio liabilities that are not expected to be affected by prepayments, defaults and other factors affecting the timing and amount of cash flows of the designated hedged layer. At inception, this fair value hedge had a pay fixed rate of 4.33 % and a received rate of 5.32 % ( 3.92 % as of December 31, 2025). The change in the fair value of the interest rate swap was reported in other comprehensive income (loss) and was subsequently reclassified into interest expense or income in the period that the hedged transaction affected earnings. The change in fair value for this derivative instrument for the years ended December 31, 2025 and 2024 was $ 96,000 and $( 43,000 ), respectively. For the years ended December 31, 2025 and 2024, $( 8,000 ) and $ 30,000 of interest (expense) income was reclassified from AOCI into expense, respectively. Fair Value Hedges of Interest Rate Risk The Company is exposed to changes in the fair value of certain pools of fixed-rate assets due to changes in benchmark interest rates. The Company uses interest rate swaps to manage its exposure to changes in fair value on these instruments attributable to changes in the designated benchmark interest rate. The Company's interest rate swaps designated as fair value hedges involve the payment of fixed-rate amounts to a counterparty in exchange for the Company receiving variable-rate payments over the life of the agreement without the exchange of the underlying notional amount. The hedging strategy effectively converts these fixed-rate assets to SOFR floating rate assets for the term of the swap starting on the effective date. For derivatives designated and that qualify as fair value hedges, the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in interest income. In June 2023, the Company entered into a three-year $ 25 million notional amount interest rate contract that was designated as a fair value hedge utilizing a pay fixed interest rate swap to hedge a portion of the residential mortgage loan portfolio's change in fair value attributable to the movement in the one-month SOFR. On June 6, 2025, the Company terminated this pay fixed interest rate swap which resulted in a swap termination fee of $- 0 - due to the counterparty. Also, $ 336,000 of cash posted to the counterparty as collateral for this interest rate swap contract was returned to the Company. The Company terminated this interest rate swap as it was determined that this derivative was no longer meeting the aims of the Company’s interest rate risk management strategy as it was probable that the hedged forecasted transaction – the potential interest rate risk/variability in fair value of the residential loan portfolio attributable to the movement in one-month SOFR – would not occur by the end of the original maturity date of the hedging instrument. In November 2023, the Company entered into a second three-year $ 25 million notional amount interest rate contract that was also designated as a fair value hedge utilizing a pay fixed interest rate swap to hedge a portion of the residential mortgage loan portfolio's change in fair value attributable to the movement in the one-month SOFR. On November 1, 2024, the Company terminated this second pay fixed interest rate swap which resulted in a swap termination fee of $ 398,000 due to the counterparty. The $ 398,000 fee was recorded as a residential mortgage loan basis adjustment and is included in 1-4 family residential loans as it is amortized over the remaining expected life of the original swap – 24 months. Also, $ 1.2 million of cash posted to the counterparty as collateral for this interest rate swap contract was returned to the Company. The Company terminated this interest rate swap as it was determined that this derivative was no longer meeting the aims of the Company’s interest rate risk management strategy as it was probable that the hedged forecasted transaction – the potential interest rate risk/variability in fair value of the residential loan portfolio attributable to the movement in one-month SOFR – would not occur by the end of the original maturity date of the hedging instrument. On June 23, 2025, the Company entered into an 18-month $ 25 million notional amount interest rate contract that was designated as a fair value hedge utilizing a pay fixed interest rate swap to hedge a portion of the residential mortgage loan portfolio's change in fair value attributable to the movement in the one-month SOFR. At inception, this fair value hedge had a pay fixed rate of 3.78 % and a receive rate of 4.31 % ( 3.92 % as of December 31, 2025). On September 10, 2025, the Company entered into a 12-month $ 25 million notional amount interest rate contract that was designated as a fair value hedge utilizing a pay fixed interest rate swap to hedge a portion of the residential mortgage loan portfolio's change in fair value attributable to the movement in the one-month SOFR. At inception, this fair value hedge had a pay fixed rate of 3.62 % and a receive rate of 4.37 % ( 3.92 % as of December 31, 2025). 80 Additionally, in December 2023, the Company entered into a three-year $ 10 million notional amount interest rate contract that was designated as fair value hedge utilizing a pay fixed interest rate swap to hedge a portion of the securities available-for-sale municipal bond portfolio's change in fair value attributable to the movement in the one-month SOFR. On December 19, 2024 the Company terminated this pay fixed interest rate swap which resulted in a swap termination fee of $ 32,000 due to the counterparty. The $ 32,000 fee was recorded as a municipal bond basis adjustment and is included in securities available-for-sale as it is amortized over a period consistent with the amortization of the discounts and premiums associated with the formerly hedged items. Also, $ 280,000 of cash posted to the counterparty as collateral for this interest rate swap contract was returned to the Company. The Company terminated this interest rate swap as it was determined that this derivative was no longer meeting the aims of the Company’s interest rate risk management strategy as it was probable that the hedged forecasted transaction – the potential interest rate risk/variability in fair value of the securities available-for-sale municipal bond portfolio attributable to the movement in one-month SOFR – would not occur by the end of the original maturity date of the hedging instrument. As of December 31, 2025 and 2024, the following amounts were recorded on the balance sheet related to cumulative basis adjustment for fair value hedges: Location in Consolidated Balance Sheets Carrying Amount of Hedged Assets/(Liabilities) Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities) (Dollars in thousands) 2025 2024 2025 2024 Total loans $ 50,096 $ 24,957 $ 96 $ ( 43 ) The carrying amount of the hedged asset located in “total loans” includes the amortized cost basis of closed portfolios of fixed-rate residential loans used to designate hedging relationships in which the hedged items are the stated amount of assets anticipated to be outstanding for the designated hedged period. At December 31, 2025 and 2024, the amortized cost basis of the closed portfolios of fixed-rate residential loans used in the hedging relationship was in excess of the carrying amount of the hedged asset. At December 31, 2025 and 2024, the cumulative basis adjustments associated with this hedging relationship was $ 96,000 and $( 43,000 ), respectively; and the notional amount of the designated hedged item was $ 50.0 million and $ 25.0 million, respectively. Under the "portfolio layer" approach, the Company designated a notional amount of portfolio assets that are not expected to be affected by prepayments, defaults and other factors affecting the timing and amount of cash flows of the designated hedged layer. The notional amounts of these agreements do not represent amounts exchanged by the parties and, thus, are not a measure of potential loss exposure. At December 31, 2025 and 2024, the Company’s fair value hedges had a remaining maturity of 0.73 years and 1.42 years, respectively, an average pay fixed rate of 3.91 % and 3.99 %, respectively, and an average received rate of 3.92 % and 5.19 %, respectively. Derivatives not Designated as Hedging Instruments Customer Loan Swaps Derivatives not designated as hedges are not speculative and result from a service the Company provides to certain commercial banking customers. On May 19, 2023, the Company entered into an interest rate swap with a commercial loan borrower. The Company executes interest rate swaps with customers to facilitate their respective risk management strategies. The interest rate swap contract with the commercial loan borrower allows them to convert floating-rate loan payments based on SOFR to fixed-rate loan payments. This interest rate swap is simultaneously hedged by an offsetting derivative that the Company executes with a third party, such that the Company minimizes its net risk exposure resulting from such transactions. As the interest rate derivatives associated with this program do not meet hedge accounting requirements, changes in the fair value of both the customer derivative and the offsetting derivative are recognized directly in earnings. 81 The following table presents the fair value of the Company’s derivative financial instruments as well as their classification on the consolidated balance sheet: Derivative Assets Derivative Liabilities Notional Amount Location Fair Value Notional Amount Location Fair Value (Dollars in thousands) December 31, 2025 Derivatives designated as hedging instruments: Interest rate contracts - fair value hedge $ 50,000 $ — $ — Other liabilities $ 96 Interest rate contracts - cash flow hedge 10,000 — — Other liabilities 41 Total derivatives designated as hedging instruments $ 60,000 $ — $ — $ 137 Derivatives not designated as hedging instruments: Customer loan swaps $ 4,486 Other assets $ 54 $ 4,486 Other liabilities $ 54 December 31, 2024 Derivatives designated as hedging instruments: Interest rate contracts - fair value hedge $ 25,000 Other assets $ 43 $ — $ — Interest rate contracts - cash flow hedge 10,000 — — Other liabilities 43 Total derivatives designated as hedging instruments $ 35,000 $ 43 $ — $ 43 Derivatives not designated as hedging instruments: Customer loan swaps $ 4,630 Other assets $ 71 $ 4,630 Other liabilities $ 71 Credit-risk-related Contingent Features By entering into derivative transactions, the Company is exposed to credit risk to the extent that counterparties to the derivative contracts do not perform as required. Should a counterparty fail to perform under the terms of a derivative contract, the Company’s credit exposure on interest rate swaps is limited to the net positive fair value and accrued interest of all swaps with each counterparty. The Company seeks to minimize counterparty credit risk through credit approvals, limits, and other monitoring procedures. Institutional counterparties must have an investment grade credit rating and be approved by the Company’s board of directors. As such, management believes the risk of incurring credit losses on derivative contracts with institutional counterparties is remote. As of December 31, 2025 and 2024, the Company posted $ 450,000 and $ 781,000 , respectively, of cash to the counterparties as collateral on its interest rate swap contracts and customer loan swaps, which was presented within cash and due from banks on the consolidated balance sheets. Balance Sheet Offsetting Certain financial instruments may be eligible for offset in the consolidated balance sheet and/or subject to master netting arrangements or similar agreements. The Company’s derivative transactions with institutional counterparties are generally executed under International Swaps and Derivative Association (“ISDA”) master agreements which include “right of set-off” provisions. In such cases there is generally a legally enforceable right to offset recognized amounts and there may be an intention to settle such amounts on a net basis. Generally, the Company does not offset such financial instruments for financial reporting purposes. 82 The following tables present the information about derivative positions that are eligible for offset in the consolidated balance sheets as of December 31, 2025 and 2024: Gross Amounts Not Offset (Dollars in thousands) Gross Amounts Recognized Gross Amounts Offset Net Amounts Recognized Financial Instruments Pledged (Received) Cash Collateral Pledged (Received)(1) Net Amount December 31, 2025 Derivative Assets: Interest rate contracts - fair value hedges(2) $ — $ — $ — $ — $ — $ — Interest rate contracts - cash flow hedge (2) — — — — — — Customer loan swaps - commercial customer (3) 54 — 54 — 54 — Total $ 54 $ — $ 54 $ — $ 54 $ — Derivative Liabilities: Interest rate contracts - fair value hedges (2) $ 96 $ — $ 96 $ — $ 96 $ — Interest rate contracts - cash flow hedge (2) 41 — 41 — 41 — Customer loan swaps - dealer bank (3) 54 — 54 — — 54 Total $ 191 $ — $ 191 $ — $ 137 $ 54 December 31, 2024 Derivative Assets: Interest rate contracts - fair value hedges(2) $ 43 $ — $ 43 $ — $ 43 $ — Interest rate contracts - cash flow hedge (2) — — — — — — Customer loan swaps - commercial customer (3) 71 — 71 — 71 — Total $ 114 $ — $ 114 $ — $ 114 $ — Derivative Liabilities: Interest rate contracts - fair value hedges (2) $ — $ — $ — $ — $ — $ — Interest rate contracts - cash flow hedge (2) 43 — 43 — 43 — Customer loan swaps - dealer bank (3) 71 — 71 — — 71 Total $ 114 $ — $ 114 $ — $ 43 $ 71 (1) The amount presented was the lesser of the amount pledged (received) or the net amount presented in the consolidated balance sheets. (2) Interest rate swap contracts were completed with the same dealer bank. The Company maintains a master netting arrangement with the counterparty and settles collateral on a net basis for all contracts. (3) The Company manages its net exposure on its commercial customer loan swaps by obtaining collateral as part of the normal loan policy and underwriting practices. The Company does not post collateral to its commercial customers as part of its contract. 19. Fair Values of Assets and Liabilities Determination of Fair Value The fair value of an asset or liability is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company uses prices and inputs that are current as of the measurement date, including during periods of market dislocation. In periods of market dislocation, the observability of prices and inputs may be reduced for many instruments. This condition could cause an instrument to be 83 reclassified from one level to another. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various assets and liabilities. In cases where quoted market prices are not available, fair values are based on estimates using present value of cash flows or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument. The Company groups its assets and liabilities measured at fair value in three levels, based on the markets in which the assets and liabilities are traded, and the observability and reliability of the assumptions used to determine fair value. Level 1 – Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 – Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 – Level 3 inputs are unobservable inputs for the asset or liability. For assets and liabilities, fair value is based upon the lowest level of observable input that is significant to the fair value measurement. In general, fair value is based upon quoted market prices, where available. If such quoted market prices are not available, fair value is based upon models that primarily use, as inputs, observable market-based parameters. The Company’s valuation methodologies may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. While management believes the Company’s valuation methodologies are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. Furthermore, the reported fair value amounts have not been comprehensively revalued since the presentation dates, and, therefore, estimates of fair value after the balance sheet date may differ significantly from the amounts presented therein. A more detailed description of the valuation methodologies used for assets and liabilities measured at fair value is set forth below. A description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. These valuation methodologies were applied to all of the Company’s financial assets and financial liabilities carried at fair value at December 31, 2025 and 2024. Financial Assets and Financial Liabilities: Financial assets and financial liabilities measured at fair value on a recurring basis include the following: Securities Available-for-Sale : The Company’s investment in U.S. Government-sponsored entities bonds, U.S Government agency small business administration pools guaranteed by the SBA, collateralized mortgage obligations issued by the FHLMC, FNMA, and GNMA residential mortgage-backed securities, other municipal bonds, corporate debt and corporate subordinated debt is generally classified within Level 2 of the fair value hierarchy. For these securities, the Company obtains fair value measurements from independent pricing services or uses fair value measurements considering observable market data. The fair value measurements consider observable data that may include reported trades, dealer quotes, market spreads, cash flows, the U.S. treasury yield curve, trading levels, market consensus prepayment speeds, credit information and the instrument’s terms and conditions. Mortgage Servicing Rights : Fair value is based on a valuation model that calculates the present value of estimated future net servicing income. The valuation model utilizes interest rate, prepayment speed and default rate assumptions that market participants would use in estimating future net servicing income and that can be validated against available market data (see Note 6 for more information). These assumptions are inherently sensitive to change as these unobservable inputs are not based on quoted prices in active markets or otherwise observable. Derivative Instruments and Hedges: The valuation of these instruments is determined using the discounted cash flow method on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. 84 The following table summarizes financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2025 and 2024, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value: Total Level 1 Level 2 Level 3 (Dollars in thousands) December 31, 2025 Securities available-for-sale: U.S. Government-sponsored enterprises ("GSE") obligations $ 1,453 $ — $ 1,453 $ — U.S Government agency small business administration pools guaranteed by the SBA 10,573 — 10,573 — Collateralized mortgage obligations issued by the FHLMC, FNMA and GNMA 34,742 — 34,742 — Residential mortgage-backed securities 64,495 — 64,495 — Municipal bonds 29,269 — 29,269 — Corporate debt 6,177 — 6,177 — Corporate subordinated debt 5,697 — 5,697 — Other assets: Mortgage servicing rights 257 — — 257 Derivatives 54 — 54 — Other liabilities: Derivatives 191 — 191 — Total Level 1 Level 2 Level 3 (Dollars in thousands) December 31, 2024 Securities available-for-sale: U.S. Government-sponsored enterprises ("GSE") obligations $ 1,387 $ — $ 1,387 $ — U.S Government agency small business administration pools guaranteed by the SBA 13,125 — 13,125 — Collateralized mortgage obligations issued by the FHLMC, FNMA and GNMA 19,362 — 19,362 — Residential mortgage-backed securities 48,462 — 48,462 — Municipal bonds 29,532 — 29,532 — Corporate debt 484 — 484 — Corporate subordinated debt 7,865 — 7,865 — Other assets: Mortgage servicing rights 305 — — 305 Derivatives 114 — 114 — Other liabilities: Derivatives 114 — 114 — 85 For the years ended December 31, 2025 and 2024, the changes in Level 3 assets and liabilities measured at fair value on a recurring basis were as follows: (Dollars in thousands) Mortgage Servicing Rights (1) Balance as of January 1, 2025 $ 305 Included in net loss ( 48 ) Balance as of December 31, 2025 $ 257 Total unrealized net gains (losses) included in net loss related to assets still held as of December 31, 2025 $ — Balance as of January 1, 2024 $ 339 Included in net loss ( 34 ) Balance as of December 31, 2024 $ 305 Total unrealized net gains (losses) included in net loss related to assets still held as of December 31, 2024 $ — (1) Realized and unrealized gains and losses related to mortgage servicing rights are reported as a component of loan servicing fee income in the Company’s consolidated statements of loss. For Level 3 assets measured at fair value on a recurring basis as of December 31, 2025 and 2024, the significant unobservable inputs used in the fair value measurements were as follows: December 31, 2025 (Dollars in thousands) Valuation Technique Description Range Weighted Average (1) Fair Value Mortgage Servicing Rights Discounted Cash Flow Prepayment Rate 4.75 % - 29.19 % 9.83 % $ 257 Discount Rate 9.500 % - 9.500 % 9.50 % Delinquency Rate 2.17 % - 2.57 % 2.24 % Default Rate 0.16 % - 0.20 % 0.17 % December 31, 2024 (Dollars in thousands) Valuation Technique Description Range Weighted Average (1) Fair Value Mortgage Servicing Rights Discounted Cash Flow Prepayment Rate 4.54 % - 18.71 % 6.51 % $ 305 Discount Rate 10.00 % - 10.00 % 10.00 % Delinquency Rate 2.17 % - 2.64 % 2.25 % Default Rate 0.14 % - 0.24 % 0.16 % (1) Unobservable inputs for mortgage servicing rights were weighted by loan amount. The significant unobservable inputs used in the fair value measurement of the Company’s mortgage servicing rights are the weighted-average prepayment rate, weighted-average discount rate, weighted average delinquency rate and weighted-average default rate. Significant increases (decreases) in any of those inputs in isolation could result in a significantly lower (higher) fair value measurement. Although the prepayment rate and the discount rate are not directly interrelated, they generally move in opposite directions of each other. The Company estimates the fair value of mortgage servicing rights by using a discounted cash flow model to calculate the present value of estimated future net servicing income. Observable and unobservable inputs are entered into this model as prescribed by an independent third party to arrive at an estimated fair value. Certain financial assets and financial liabilities are measured at fair value on a non-recurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). Financial assets measured at fair value on a non-recurring basis during the reported periods may include certain individually evaluated loans reported at the fair value of the underlying collateral. Fair value is measured using appraised values of collateral and adjusted as necessary by management based on unobservable inputs for specific properties. However, the choice of observable data is subject to significant judgment, and there are often adjustments based on judgment in order to make observable data comparable and to consider the impact of time, the condition of properties, interest rates and other market factors on current values. Additionally, commercial real estate appraisals frequently involve discounting of projected cash flows, which relies inherently on unobservable data. Therefore, real estate collateral related non-recurring fair value measurement adjustments have generally been classified as Level 3. Estimates of fair value used for other collateral supporting commercial loans generally are based on assumptions not observable in the marketplace, and therefore, such valuations have been classified as Level 3. Financial assets measured at 86 fair value on a non-recurring basis during the reported periods also include loans held for sale. Residential mortgage loans held for sale are recorded at the lower of cost or fair value and are therefore measured at fair value on a non-recurring basis. The fair values for loans held for sale are estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality and are included in Level 3. At December 31, 2025 and 2024, there were no assets measured at fair value on a non-recurring basis. Non-Financial Assets and Non-Financial Liabilities: The Company has no non-financial assets or non-financial liabilities measured at fair value on a recurring basis. Non-financial assets measured at fair value on a non-recurring basis generally include certain foreclosed assets which, upon initial recognition, were remeasured and reported at fair value through a charge-off to the allowance for credit losses and certain foreclosed assets which, subsequent to their initial recognition, are remeasured at fair value through a write-down included in other non-interest expense. There were no foreclosed assets at December 31, 2025 or 2024. ASC 825 - "Accounting For Financial Instruments (Subtopic 825-10)" , requires disclosure of the fair value of financial assets and financial liabilities, including those financial assets and financial liabilities that are not measured and reported at fair value on a recurring basis or non-recurring basis. The methodologies for estimating the fair value of financial assets and financial liabilities that are measured at fair value on a recurring or non-recurring basis are discussed above. ASC 825 requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes. The exit price notion is a market-based measurement of fair value that is represented by the price to sell an asset or transfer a liability in the principal market (or most advantageous market in the absence of a principal market) on the measurement date. At December 31, 2025 and 2024, fair values of loans are estimated on an exit price basis incorporating discounts for credit, liquidity and marketability factors. Summary of Fair Values of Financial Instruments not Carried at Fair Value The estimated fair values, and related carrying or notional amounts, of the Company’s financial instruments not carried at fair value at December 31 are as follows: (Dollars in thousands) Carrying Amount Fair Value Level 1 Level 2 Level 3 December 31, 2025 Financial Assets: Cash and due from banks $ 13,414 $ 13,414 $ 13,414 $ — $ — Federal Home Loan Bank stock 2,431 2,431 — 2,431 — Bank-owned life insurance 4,875 4,875 — 4,875 — Loans, net 416,047 387,121 — — 387,121 Accrued interest receivable 2,108 2,108 2,108 — — Financial Liabilities: Deposits $ 470,773 $ 470,841 $ 318,884 $ 151,957 $ — Advances from Federal Home Loan Bank 52,308 52,182 — 52,182 — Mortgagors’ tax escrow 811 811 — 811 — Accrued interest payable 484 484 484 — — December 31, 2024 Financial Assets: Cash and due from banks $ 7,100 $ 7,100 $ 7,100 $ — $ — Federal Home Loan Bank stock 2,498 2,498 — 2,498 — Bank-owned life insurance 4,768 4,768 — 4,768 — Loans, net 435,481 397,154 — — 397,154 Accrued interest receivable 2,103 2,103 2,103 — — Financial Liabilities: Deposits 454,208 453,890 318,520 135,370 — Advances from Federal Home Loan Bank 52,268 52,208 — 52,208 — Mortgagors’ tax escrow 654 654 — 654 — Accrued interest payable 475 475 475 — — 87 20. Condensed Financial Statements of Parent Company Financial information pertaining to First Seacoast Bancorp, Inc. only is as follows: CONDENSED BALANCE SHEETS December 31, 2025 2024 (Dollars in thousands) ASSETS Cash held at First Seacoast Bank $ 16,454 $ 17,055 Investment in First Seacoast Bank 43,005 40,862 Loan to First Seacoast Bank ESOP 4,057 4,129 Other assets 41 41 Total assets 63,557 62,087 LIABILITIES Other liabilities 10 37 Total liabilities 10 37 STOCKHOLDERS’ EQUITY Stockholders’ equity 63,547 62,050 Total liabilities and stockholders’ equity $ 63,557 $ 62,087 CONDENSED STATEMENTS OF LOSS For the Year Ended December 31, 2025 2024 (Dollars in thousands) Income: Interest on loan to First Seacoast Bank ESOP $ 310 $ 314 Expense: Miscellaneous expense 5 24 Miscellaneous expense 5 24 Income before income tax expense and equity in undistributed net loss of First Seacoast Bank 305 290 Income tax expense — — Net income before equity in undistributed net loss of First Seacoast Bank 305 290 Equity in undistributed net loss of First Seacoast Bank ( 1,150 ) ( 803 ) Net loss $ ( 845 ) $ ( 513 ) 88 CONDENSED STATEMENTS OF CASH FLOWS For the Year Ended December 31, 2025 2024 (Dollars in thousands) CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ ( 845 ) $ ( 513 ) Adjustments to reconcile net loss to net cash provided by operating activities: Undistributed net loss of First Seacoast Bank 1,150 803 (Decrease) increase in other liabilities ( 27 ) 37 Net cash provided by operating activities 278 327 CASH FLOWS FROM INVESTING ACTIVITIES: Principal payment received on loan to First Seacoast Bank ESOP 72 68 Net cash provided by investing activities 72 68 CASH FLOWS FROM FINANCING ACTIVITIES: Treasury stock purchases, net of excise taxes ( 951 ) ( 3,736 ) Net cash used by financing activities ( 951 ) ( 3,736 ) Net change in cash ( 601 ) ( 3,341 ) Cash at beginning of year 17,055 20,396 Cash at end of year $ 16,454 $ 17,055 89 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and Board of Directors of First Seacoast Bancorp, Inc.: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of First Seacoast Bancorp, Inc. and Subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of loss, comprehensive loss, changes in stockholders’ equity, and cash flows for each of the years in the two-year period ended December 31, 2025, and the related notes to the consolidated financial statements (collectively, “the financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. 90 Allowance for Credit Losses – Qualitative Factors As described in Note 5 to the financial statements, the Company has recorded an allowance for credit losses on loans (ACL) in the amount of $3.4 million as of December 31, 2025, representing management’s estimate of credit losses over the remaining expected life of the Company’s loan portfolio as of that date pursuant to the application of ASC 326. The Company’s methodology to determine its allowance for credit losses on loans incorporates qualitative assessments of its historical losses, current loan portfolio and economic conditions, the application of forecasted economic conditions, and model limitations. We determined that performing procedures relating to these components of the Company’s methodology is a critical audit matter. The principal considerations for our determination are (i) the application of significant judgment and estimation on the part of management, which in turn led to a high degree of auditor judgment and subjectivity in performing procedures and evaluating audit evidence obtained, and (ii) significant audit effort was necessary in evaluating management’s methodology, significant assumptions and calculations. How the Critical Audit Matter was addressed in the Audit Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the financial statements. These procedures included, among others, testing management’s process for determining the qualitative reserve component, evaluating the appropriateness of management’s methodology relating to the qualitative reserve component and testing the completeness and accuracy of data utilized by management. We have served as the Company's auditor since 2024. /s/ Wolf & Company, P.C. Boston, Massachusetts March 20, 2026 91 ITEM 9. Changes In and Disagreements With Acco untants on Accounting and Financial Disclosure None.