What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-05-08 compared with 2025-11-07 · 108 added, 223 removed, 159 unchanged (68% of the section changed)

4 unchanged sentences

Forward-looking statements, which are based on certain assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by the use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,” “plan,” or similar expressions.

The Company’s ability to predict results or the actual effect of future plans or strategies is inherently

uncertain and actual results may differ from those predicted.

The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain and actual results may differ from those predicted.

The Company undertakes no obligation to update these forward-looking statements in the future.

28 unchanged sentences

Balance Sheet Analysis

Total assets increased $46.7 million, or 2.3%, to $2.1 billion at September 30, 2025, from $2.0 billion at December 31, 2024.

The increase in assets was primarily due to increases in net loans of $61.2 million, equity securities of $3.5 million, and securities held-to-maturity of $1.7 million, partially offset by decreases in cash and cash equivalents of $13.9 million, real estate owned of $4.6 million, and other assets of $2.0 million.

Cash and cash equivalents decreased $13.9 million, or 17.8%, to $64.3 million at September 30, 2025 from $78.3 million at December 31, 2024.

The decrease in cash and cash equivalents was a result of partially funding an increase in net loans of $61.2 million.

Equity securities increased $3.5 million, or 16.0%, to $25.5 million at September 30, 2025 from $22.0 million at December 31, 2024.

The increase in equity securities was attributable to the purchase of $3.0 million in equity securities during the nine months ended September 30, 2025 and market appreciation of $521,000 due to market interest rate volatility during the nine months ended September 30, 2025.

Securities held-to-maturity increased $1.7 million, or 11.6%, to $16.3 million at September 30, 2025 from $14.6 million at December 31, 2024 due to purchases of $2.5 million in municipal bonds, partially offset by $800,000 in maturities and pay-downs of various investment securities.

Loans, net of the allowance for credit losses, increased $61.2 million, or 3.4%, to $1.9 billion at September 30, 2025 from $1.8 billion at December 31, 2024.

The increase in loans consisted of increases of $91.8 million in multi-family loans of which $53.3 million is attributed to residential cooperative building loans, $9.8 million in non-residential loans, and $2.9 million in commercial and industrial loans.

The increases in these loan categories were partially offset by decreases of $40.5 million in construction loans, $1.6 million in consumer loans, $1.2 million in mixed-use loans, and $298,000 in one-to-four family loans.

Total assets decreased $38.4 million, or 1.9%, to $2.0 billion at March 31, 2026, from $2.1 billion at December 31, 2025.

The decrease in assets was primarily due to decreases in net loans of $31.8 million, cash and cash equivalents of $5.0 million, and other assets of $2.0 million.

Cash and cash equivalents decreased $5.0 million, or 6.1%, to $76.1 million at March 31, 2026 from $81.2 million at December 31, 2025.

The decrease in cash and cash equivalents partially funded a decrease of $50.0 million in borrowings.

Equity securities increased $879,000, or 3.3%, to $27.4 million at March 31, 2026 from $26.6 million at December 31, 2025.

The increase in equity securities was attributable to the purchase of $1.0 million in equity securities during the three months ended March 31, 2026, partially offset by market depreciation of $121,000 due to market interest rate volatility during the three months ended March 31, 2026.

Securities held-to-maturity decreased $150,000, or 0.8%, to $18.2 million at March 31, 2026 from $18.3 million at December 31, 2025 due to pay-downs of various investment securities.

Loans, net of the allowance for credit losses, decreased $31.8 million, or 1.7%, to $1.8 billion at March 31, 2026 from $1.9 billion at December 31, 2025.

The decrease in loans consisted of decreases of $16.1 million in construction loans, $14.3 million in multi-family loans, $610,000 in commercial and industrial loans, $494,000 in mixed-use loans, $258,000 in non-residential loans, $34,000 in one-to-four family loans, and $21,000 in consumer loans.

The decrease in our construction loan portfolio was due to normal pay-downs and principal reductions as construction projects were completed and either condominium units were sold to end buyers or multi-family rental buildings were refinanced by other financial institutions.

During the nine months ended September 30, 2025, we originated loans totaling $714.3 million consisting primarily of $528.3 million in construction loans, $107.8 million in multi-family loans of which $43.2 million is attributed to residential cooperative building loans, $66.5 million in commercial and industrial loans, $11.1 million in non-residential loans, and $730,000 in mixed-use loans.

The $528.3 million in construction loans had 43.6% disbursed at loan closing, with the remaining funds to be disbursed over the terms of the construction loans.

The allowance for credit losses related to loans decreased to $4.7 million as of September 30, 2025, from $4.8 million as of December 31, 2024.

The decrease in the allowance for credit losses related to loans was due to charge-offs totaling $678,000, offset by recoveries totaling $534,000 and provision for credit losses totaling $62,000.

Premises and equipment increased $702,000, or 2.8%, to $25.5 million at September 30, 2025 from $24.8 million at December 31, 2024 primarily due to the purchases of additional fixed assets and the expansion of our Kiryas Joel branch office.

Federal Home Loan Bank stock increased $13,000, or 3.3%, to $410,000 at September 30, 2025 from $397,000 at December 31, 2024 primarily due to an increase in mortgage-related assets.

Bank owned life insurance (“BOLI”) increased $513,000, or 2.0%, to $26.3 million at September 30, 2025 from $25.7 million at December 31, 2024 due to increases in the BOLI cash value.

Accrued interest receivable decreased $687,000, or 5.1%, to $12.8 million at September 30, 2025 from $13.5 million at December 31, 2024 due to a 25 basis point decrease in the Prime Rate that occurred in September 2025, partially offset by an increase of $61.2 million in the loan portfolio.

Real estate owned decreased $4.6 million, or 89.4%, to $545,000 at September 30, 2025 from $5.1 million at December 31, 2024 due to the sale of a foreclosed property to an independent third party and a charge-off totaling $222,000 on the remaining foreclosed property.

Property held for investment decreased $27,000, or 2.0%, to $1.3 million at September 30, 2025 from $1.4 million at December 31, 2024 due to the amortization of property.

Right of use assets — operating increased $211,000, or 5.3%, to $4.2 million at September 30, 2025 from $4.0 million at December 31, 2024, primarily due to the physical expansion of a branch office, partially offset by the amortization of the right of use assets.

Other assets decreased $2.0 million, or 17.4%, to $9.6 million at September 30, 2025 from $11.6 million at December 31, 2024 due to decreases of $2.5 million in tax assets and $7,000 in miscellaneous assets, partially offset by increases of $433,000 in suspense accounts and $15,000 in prepaid expenses.

Total deposits decreased $155.0 million, or 9.3%, to $1.5 billion at September 30, 2025 from $1.7 billion at December 31, 2024.

The decrease in deposits was primarily due to decreases in certificates of deposit of $198.7 million, or 19.8% and savings account balances of $7.9 million, or 5.7%, partially offset by increases in NOW/money market accounts of $51.6 million, or 21.2% and non-interest bearing deposits of $1.7 million, or 0.6%.

The decrease of $198.7 million in certificates of deposit consisted of decreases in brokered certificates of deposit of $117.6 million, or 27.0%, retail certificates of deposit of $106.8 million, or 20.8%, and military deposits of $4.8 million, or 24.1%, partially offset by an increase in non-brokered listing services certificates of deposit of $30.4 million, or 90.5%.

The decrease in brokered certificates of deposit was due to management’s strategy to reduce the cost of funds by “calling” higher rate brokered deposits on their call dates and to rely less on brokered deposits.

During the three months ended March 31, 2026, we originated loans totaling $266.1 million, which includes commitments and funded loans, consisting primarily of $244.2 million in construction loans and $21.8 million in commercial and industrial loans.

The $244.2 million in construction loans had $99.5 million, or 40.7%, disbursed at loan closing, with the remaining funds to be disbursed over the terms of the construction loans.

The commercial and industrial loans had $18.9 million, or 86.7%, disbursed at loan closing.

The allowance for credit losses related to loans decreased to $4.6 million as of March 31, 2026, from $4.7 million as of December 31, 2025.

The decrease in the allowance for credit losses related to loans was due to charge-offs totaling $27,000 and a provision for credit losses reduction of $112,000 to the allowance for credit losses related to loans due to a decrease of $31.8 million in the loan portfolio.

The provision for credit losses reduction of $112,000 to the allowance for credit losses related to loans was offset by a provision for credit losses of $112,000 to the allowance for credit losses related to off-balance sheet commitments.

Premises and equipment decreased $199,000, or 0.8%, to $25.2 million at March 31, 2026 from $25.4 million at December 31, 2025 primarily due to the amortization of fixed assets.

Federal Home Loan Bank stock was $410,000 and property held for investment was $1.3 million at both March 31, 2026 and December 31, 2025.

Bank owned life insurance (“BOLI”) increased $179,000, or 0.7%, to $26.6 million at March 31, 2026 from $26.4 million at December 31, 2025 due to increases in the BOLI cash value.

Accrued interest receivable decreased $152,000, or 1.2%, to $12.1 million at March 31, 2026 from $12.2 million at December 31, 2025 due to a decrease of $31.9 million in the loan portfolio.

Right of use assets — operating decreased $179,000, or 3.8%, to $4.5 million at March 31, 2026 from $4.7 million at December 31, 2025, primarily due to depreciation of the right of use assets.

Other assets decreased $2.0 million, or 18.0%, to $9.0 million at March 31, 2026 from $11.0 million at December 31, 2025 due to decreases of $2.2 million in tax assets, partially offset by increases of $143,000 in prepaid expenses and $57,000 in suspense accounts.

Total deposits increased $9.4 million, or 0.6%, to $1.6 billion at March 31, 2026 from $1.6 billion at December 31, 2025.

The increase in deposits was primarily due to increases in NOW/money market accounts of $50.0 million, or 16.5% and non-interest bearing deposits of $25.0 million, or 9.2%, partially offset by decreases in certificates of deposit of $57.1 million, or 6.3%, and savings account balances of $8.5 million, or 6.0%.

The decrease of $57.1 million in certificates of deposit consisted of decreases in brokered certificates of deposit of $40.6 million, or 11.0%, non-brokered listing services certificates of deposit of $5.4 million, or 6.2%, and retail certificates of deposit of $11.2 million, or 2.5%.

The decrease in brokered certificates of deposit and non-brokered listing services certificates of deposit was due to management’s strategy to reduce the cost of funds by “calling” higher rate brokered deposits on their call dates and to rely less on brokered deposits and non-brokered listing service deposits.

The decrease in retail certificates of deposit was due to a shift in deposits to our retail high yield money market accounts.

The increase in non-brokered listing services certificates of deposits was due to management’s strategy to diversify funding sources.

Advance payments by borrowers for taxes and insurance increased $1.2 million, or 75.5%, to $2.8 million at September 30, 2025 from $1.6 million at December 31, 2024 due primarily to accumulation of real estate tax payments from borrowers.

Borrowings increased to $170.0 million at September 30, 2025 from none at December 31, 2024 due primarily to management’s strategy to diversify funding sources.

Lease liability – operating increased $225,000, or 5.5%, to $4.3 million at September 30, 2025 from $4.1 million at December 31, 2024, primarily due to the physical expansion of a branch office, partially offset by the amortization of the lease liability.

Accounts payable and accrued expenses increased $4.5 million, or 30.8%, to $19.0 million at September 30, 2025 from $14.5 million at December 31, 2024 due primarily to increases in accrued dividends payable of $3.4 million, accrued borrowing interest expense of $802,000, deferred compensation of $458,000, suspense accounts for loan closings of $51,000, and the allowance for credit losses for off-balance sheet commitments of $175,000, partially offset by a decrease in accrued expense of $548,000.

The allowance for credit losses for off-balance sheet commitments increased $175,000, or 24.9%, to $879,000 at September 30, 2025 from $704,000 at December 31, 2024 due primarily to an increase of $83.5 million, or 14.9%, in off-balance sheet commitments since December 31, 2024.

Stockholders’ equity increased $25.7 million, or 8.1% to $344.0 million at September 30, 2025, from $318.3 million at December 31, 2024.

The increase in stockholders’ equity was due to net income of $33.6 million for the nine months ended September 30, 2025, an increase of $651,000 in earned employee stock ownership plan shares coupled with a reduction of $837,000 in unearned employee stock ownership plan shares, the amortization expense of $1.4 million relating to restricted stock and stock options granted under the Company’s 2022 Equity Incentive Plan, and $5,000 in other comprehensive income, partially offset by dividends declared of $10.7 million and $14,000 in stock options exercised.

Results of Operations for the Three Months Ended September 30, 2025 and 2024

Financial Highlights

Net income for the three months ended September 30, 2025 was $11.9 million compared to net income of $12.7 million for the three months ended September 30, 2024.

The decrease in net income of $821,000, or 6.5%, between periods was primarily due to an increase of $390,000 in non-interest expense, a decrease of $347,000 in net interest income, and a decrease of $335,000 in non-interest income, partially offset by no credit loss expense for the three months ended September 30, 2025 compared to a credit loss expense of $105,000 for the three months ended September 30, 2024 and a decrease of $146,000 in income tax expense.

Net Interest Income

Net interest income was $25.9 million for the three months ended September 30, 2025, as compared to $26.3 million for the three months ended September 30, 2024.

The decrease in net interest income of $347,000, or 1.3%, was primarily due to a decrease in interest income that exceeded a decrease in interest expense caused by decreases in the yield on interest earning assets and the cost of funds for interest bearing liabilities.

Total interest and dividend income decreased $1.9 million, or 4.6%, to $39.3 million for the three months ended September 30, 2025 from $41.2 million for the three months ended September 30, 2024.

The decrease in interest and dividend income was due to a decrease in the yield on interest earning assets by 74 basis points from 8.89% for the three months ended September 30, 2024 to 8.15% for the three months ended September 30, 2025, partially offset by an increase in the average balance of interest earning assets of $76.5 million, or 4.1%, to $1.9 billion for the three months ended September 30, 2025 from $1.9 billion for the three months ended September 30, 2024.

Interest expense decreased $1.6 million, or 10.5%, to $13.3 million for the three months ended September 30, 2025 from $14.9 million for the three months ended September 30, 2024.

The decrease in interest expense was due to a decrease in the cost of interest bearing liabilities by 54 basis points from 4.45% for the three months ended September 30, 2024 to 3.91% for the three months ended September 30, 2025, partially offset by an increase in average interest bearing liabilities of $26.4 million, or 2.0%, to $1.4 billion for the three months ended September 30, 2025 from $1.3 billion for the three months ended September 30, 2024.

Our net interest margin decreased 30 basis points, or 5.3%, to 5.38% for the three months ended September 30, 2025 compared to 5.68% for the three months ended September 30, 2024.

The decrease in the net interest margin was due to a 100 basis points decrease in the Federal Funds rate from September 2024 to December 2024 and a 25 basis points decrease in the Federal Funds rate in September 2025 that resulted in a decrease in the yield on interest-earning assets, partially offset by a smaller decrease in the cost of funds on interest-bearing liabilities.

Credit Loss Expense

The Company recorded no credit loss expense for the three months ended September 30, 2025 compared to a credit loss expense of $105,000 for the three months ended September 30, 2024.

The credit loss expense of $105,000 for the three months ended September 30, 2024 was comprised of a credit loss expense for off-balance sheet commitments of $105,000 primarily attributable to an increase in the weighted average remaining maturity for the aggregate unfunded off-balance sheet commitments.

With respect to the allowance for credit losses for loans, we charged-off $75,000 during the three months ended September 30, 2025 as compared to charge-offs of $82,000 during the three months ended September 30, 2024.

The charge-offs during both periods were against various unpaid overdrafts in our demand deposit accounts.

We recorded recoveries of $99,000 during the three months ended September 30, 2025 compared to no recoveries during the three months ended September 30, 2024.

The recoveries of $99,000 during the three months ended September 30, 2025 were comprised of recoveries from a previously charged-off unpaid overdraft on a demand deposit account.

Non-Interest Income

Non-interest income for the three months ended September 30, 2025 was $1.0 million compared to non-interest income of $1.3 million for the three months ended September 30, 2024.

The decrease of $335,000, or 24.8%, in total non-interest income was primarily due to decreases of $377,000 in unrealized gain on equity securities and $17,000 in miscellaneous other non-interest income, partially offset by increases of $49,000 in other loan fees and service charges and $10,000 in BOLI income.

The decrease in unrealized gain on equity securities was due to an unrealized gain of $170,000 on equity securities during the three months ended September 30, 2025 compared to an unrealized gain of $547,000 on equity securities during the three months ended September 30, 2024.

The unrealized gains of $170,000 and $547,000 on equity securities during the three months ended September 30, 2025 and 2024, respectively, were due to market interest rate volatility during both periods.

The increase of $49,000 in other loan fees and service charges was due to an increase of $50,000 in ATM/debit card/ACH fees.

The increase in BOLI income of $10,000 was due to an increase in the yield on BOLI assets.

Non-Interest Expense

Non-interest expense increased $390,000, or 3.9%, to $10.4 million for the three months ended September 30, 2025 from $10.0 million for the three months ended September 30, 2024.

The increase resulted primarily from increases of $281,000 in salaries and employee benefits, $198,000 in other operating expense, $133,000 in outside data processing expense, $38,000 in equipment expense, and $3,000 in occupancy expense, partially offset by decreases of $250,000 in real estate owned expense and $13,000 in advertising expense.

Salaries and employee benefits increased $281,000, or 5.5%, to $5.4 million for the three months ended September 30, 2025 from $5.1 million for the three months ended September 30, 2024 primarily due to the hiring of additional personnel to support the growth of the Company and an increase in employee compensation and benefits expense in order to retain key personnel, partially offset by an increase in loan origination offset expenses.

Other non-interest operating expense increased $198,000, or 7.6%, to $2.8 million for the three months ended September 30, 2025 from $2.6 million for the three months ended September 30, 2024 due mainly to increases of $192,000 in legal fees, $39,000 in dues and subscriptions, $19,000 in miscellaneous other non-interest expense, $6,000 in consulting fees, $3,000 in insurance expense, and $1,000 in telephone expense.

These increases were partially offset by decreases of $30,000 in regulatory fees, $13,000 in service contracts expense, $13,000 in directors compensation, and $5,000 in office supplies.

Legal fees increased $192,000, or 228.6%, to $276,000 for the three months ended September 30, 2025 from $84,000 for the three months ended September 30, 2024 due to legal proceedings to resolve problem loans, recovery efforts for losses incurred from previously charged-off loans and overdrafts, and general legal services.

Dues and subscriptions increased $38,000, or 20.9%, to $220,000 for the three months ended September 30, 2025 from $182,000 for the three months ended September 30, 2024 due to an increase in dues and subscriptions for general corporate purposes.

The increase of $18,000 in miscellaneous other non-interest expense was mainly due to increases of $7,000 in miscellaneous charge-offs, $6,000 in check and correspondence bank charges, $2,000 in public company expenses, $2,000 in miscellaneous expenses, and $1,000 in postage expense.

The increases of $5,000 in consultant fees and $4,000 in insurance expense were due to normal increases.

Regulatory fees decreased $30,000, or 3.6%, to $793,000 for the three months ended September 30, 2025 from $823,000 for the three months ended September 30, 2024 due to over-accrual adjustments during the three months ended September 30, 2025.

Due to efforts to contain cost, service contracts expense decreased $12,000, or 2.7%, to $426,000 for the three months ended September 30, 2025 from $438,000 for the three months ended September 30, 2024 and office supplies expense decreased $5,000, or 12.5%, to $35,000 for the three months ended September 30, 2025 from $40,000 for the three months ended September 30, 2024.

Directors’ compensation decreased $12,000, or 5.2%, to

$221,000 for the three months ended September 30, 2025 from $233,000 for the three months ended September 30, 2024 due to a reduction in the amortization expense related to the 2022 Equity Incentive Plan.

Outside data processing expense increased $133,000, or 19.5%, to $814,000 for the three months ended September 30, 2025 from $681,000 for the three months ended September 30, 2024 due to an increase in transactions and additional data processing services.

Equipment expense increased $38,000, or 20.3%, to $225,000 for the three months ended September 30, 2025 from $187,000 for the three months ended September 30, 2024 due to upgrades of equipment.

Occupancy expense increased $3,000, or 0.4%, to $738,000 for the three months ended September 30, 2025 from $735,000 for the three months ended September 30, 2024 primarily as a result of the increased cost of operating office space.

Real estate owned expense decreased $250,000, or 51.2%, to $238,000 for the three months ended September 30, 2025 from $488,000 for the three months ended September 30, 2024 due to a reduction in charge-offs.

We recorded a charge-off of $478,000 on a foreclosed property during the three months ended September 30, 2024 compared to a charge-off of $222,000 on a foreclosed property during the three months ended September 30, 2025.

The write down of $222,000 on the fair market value of a foreclosed property during the three months ended September 30, 2025 was due to the office occupancy rate in the Pittsburgh business district office market continuing to deteriorate due to workers continuing to work remotely post pandemic and the high operating expenses due to inflation.

Advertising expense decreased $13,000, or 10.2%, to $115,000 for the three months ended September 30, 2025 from $128,000 for the three months ended September 30, 2024 due to a decrease in various marketing campaigns.

We recorded income tax expense of $4.7 million and $4.9 million for the three months ended September 30, 2025 and 2024, respectively.

For the three months ended September 30, 2025, we had approximately $216,000 in tax exempt income, compared to approximately $203,000 in tax exempt income for the three months ended September 30, 2024.

Our effective income tax rate was 28.5% for the three months ended September 30, 2025 compared to 27.8% for the three months ended September 30, 2024.

Results of Operations for the Nine Months Ended September 30, 2025 and 2024

Advance payments by borrowers for taxes and insurance increased $572,000, or 24.3%, to $2.9 million at March 31, 2026 from $2.4 million at December 31, 2025 due primarily to accumulation of real estate tax payments from borrowers.

Borrowings decreased $50.0 million, or 71.4%, to $20.0 million at March 31, 2026 from $70.0 million at December 31, 2025 due primarily to management’s strategy to reduce the cost of funds.

Lease liability – operating decreased $163,000, or 3.4%, to $4.6 million at March 31, 2026 from $4.8 million at December 31, 2025, primarily due to the amortization of the lease liability.

Accounts payable and accrued expenses decreased $2.8 million, or 15.9%, to $14.5 million at March 31, 2026 from $17.3 million at December 31, 2025 due primarily to decreases in accrued expense of $2.9 million and accrued interest expense of $438,000, partially offset by increases in suspense account – loan closings of $217,000, deferred compensation of $158,000, and accounts payable of $40,000.

The allowance for credit losses for off-balance sheet commitments increased $112,000, or 12.7%, to $991,000 at March 31, 2026 from $879,000 at December 31, 2025 due primarily to an increase of $140.0 million, or 20.6%, in off-balance sheet commitments from December 31, 2025 to March 31, 2026.

Stockholders’ equity increased $4.6 million, or 1.3% to $356.3 million at March 31, 2026, from $351.7 million at December 31, 2025.

The increase in stockholders’ equity was due to net income of $10.0 million for the three months ended March 31, 2026, an increase of $178,000 in earned employee stock ownership plan shares coupled with a reduction of $130,000 in unearned employee stock ownership plan shares, the amortization expense of $547,000 relating to restricted stock and stock options granted under the Company’s 2022 Equity Incentive Plan, $37,000 in stock options exercised, and $8,000 in other comprehensive income.

These increases were offset by stock repurchases and excise taxes of $3.6 million and dividends declared of $2.7 million.

Results of Operations for the Three Months Ended March 31, 2026 and 2025

Financial Highlights

Net income for the nine months ended September 30, 2025 was $33.6 million compared to net income of $36.9 million for the nine months ended September 30, 2024.

The decrease in net income of $3.2 million, or 8.8%, between periods was primarily due to an increase of $2.3 million in non-interest expense, a decrease of $2.2 million in net interest income, and an increase of $523,000 in credit loss expense, partially offset by an increase of $473,000 in non-interest income and a decrease of $1.3 million in income tax expense.

Net income for the three months ended March 31, 2026 was $10.0 million compared to net income of $10.6 million for the three months ended March 31, 2025.

The decrease in net income of $615,000, or 5.8%, between periods was primarily due to a decrease of $439,000 in non-interest income, an increase of $260,000 in non-interest expense, a decrease of $130,000 in net interest income, and an increase of $23,000 in income tax expense, partially offset by no credit loss expense for the three months ended March 31, 2026 compared to a credit loss expense of $237,000 for the three months ended March 31, 2025.

Net Interest Income

Net interest income was $75.3 million for the nine months ended September 30, 2025 as compared to $77.5 million for the nine months ended September 30, 2024.

The decrease in net interest income of $2.2 million, or 2.9%, was primarily due to a decrease in interest income that exceeded a decrease in interest expense and a decrease in the yield on interest earning assets, partially offset by a smaller decrease in the cost of funds for interest bearing liabilities.

Total interest and dividend income decreased $4.0 million, or 3.4%, to $115.5 million for the nine months ended September 30, 2025 from $119.5 million for the nine months ended September 30, 2024.

The decrease in interest and dividend income was due to a decrease in the yield on interest earning assets by 75 basis points from 8.85% for the nine months ended September 30, 2024 to 8.10% for the nine months ended September 30, 2025, partially offset by an increase in the average balance of interest earning assets of $100.3 million, or 5.6%, to $1.9 billion for the nine months ended September 30, 2025 from $1.8 billion for the nine months ended September 30, 2024.

Interest expense decreased $1.8 million, or 4.3%, to $40.2 million for the nine months ended September 30, 2025 from $42.0 million for the nine months ended September 30, 2024.

The decrease in interest expense was due to a

decrease in the cost of interest bearing liabilities by 41 basis points from 4.36% for the nine months ended September 30, 2024 to 3.95% for the nine months ended September 30, 2025, partially offset by an increase in average interest bearing liabilities of $72.4 million, or 5.6%, to $1.4 billion for the nine months ended September 30, 2025 from $1.3 billion for the nine months ended September 30, 2024.

Net interest margin decreased 46 basis points, or 8.0%, to 5.28% for the nine months ended September 30, 2025 compared to 5.74% for the nine months ended September 30, 2024.

Net interest income was $24.1 million for the three months ended March 31, 2026, as compared to $24.3 million for the three months ended March 31, 2025.

The decrease in net interest income of $130,000, or 0.5%, was primarily due to a decrease in interest income that exceeded a decrease in interest expense caused by a decrease in the yield on interest-earning assets that exceeded the decrease in the cost of funds for interest-bearing liabilities.

Total interest and dividend income decreased $2.2 million, or 5.9%, to $36.0 million for the three months ended March 31, 2026 from $38.2 million for the three months ended March 31, 2025.

The decrease in interest and dividend income was due to a decrease in the yield on interest-earning assets of 61 basis points from 8.05% for the three months ended March 31, 2025 to 7.44% for the three months ended March 31, 2026, partially offset by an increase in the average balance of interest-earning assets of $35.2 million, or 1.9%, to $1.9 billion for the three months ended March 31, 2026 from $1.9 billion for the three months ended March 31, 2025.

Interest expense decreased $2.1 million, or 15.1%, to $11.8 million for the three months ended March 31, 2026 from $13.9 million for the three months ended March 31, 2025.

The decrease in interest expense was due to a decrease in the cost of interest-bearing liabilities by 58 basis points from 4.05% for the three months ended March 31, 2025 to 3.47% for the three months ended March 31, 2026.

The decrease in interest expense was also due to a decrease in the

average balance of interest-bearing liabilities of $9.9 million, or 0.7%, to $1.4 billion for the three months ended March 31, 2026 from $1.4 billion for the three months ended March 31, 2025.

Our net interest margin decreased 12 basis points, or 2.4%, to 4.99% for the three months ended March 31, 2026 compared to 5.11% for the three months ended March 31, 2025.

The decrease in the net interest margin was due to a 75 basis points decrease in the Federal Funds rate from September 2025 to December 2025 that resulted in a decrease in the yield on interest-earning assets, partially offset by a smaller decrease in the cost of funds on interest-bearing liabilities.

Credit Loss Expense

The Company recorded a credit loss expense of $237,000 for the nine months ended September 30, 2025 compared to a credit loss expense reduction of $286,000 for the nine months ended September 30, 2024.

The credit loss expense of $237,000 for the nine months ended September 30, 2025 was comprised of credit loss expense for loans of $62,000 and credit loss expense for off-balance sheet commitments of $175,000.

The credit loss expense for loans of $62,000 for the nine months ended September 30, 2025 was primarily due to an increase in the multi-family loan portfolio.

The credit loss expense for off-balance sheet commitments of $175,000 for the nine months ended September 30, 2025 was primarily due to an increase in unfunded off-balance sheet commitments.

The credit loss expense reduction of $286,000 for the nine months ended September 30, 2024 was comprised of a credit loss expense reduction for loans of $145,000, a credit loss expense reduction for off-balance sheet commitments of $130,000, and a credit loss expense reduction for held-to-maturity investment securities of $11,000.

The credit loss expense reduction for loans of $145,000 for the nine months ended September 30, 2024 was primarily attributed to favorable trends in the economy.

The credit loss expense reduction for off-balance sheet commitments of $130,000 for the nine months ended September 30, 2024 was primarily attributed to a reduction of $69.1 million in the level of off-balance sheet commitments, partially offset by an increase in the weighted average remaining maturity for the aggregate unfunded off-balance sheet commitments during the quarter ended September 30, 2024.

With respect to the allowance for credit losses for loans, we charged-off $678,000 during the nine months ended September 30, 2025 as compared to charge-offs of $115,000 during the nine months ended September 30, 2024.

The Company recorded no credit loss expense for the three months ended March 31, 2026 compared to a credit loss expense of $237,000 for the three months ended March 31, 2025.

The credit loss expense of $237,000 for the three months ended March 31, 2025 was comprised of credit loss expense for loans of $62,000 and credit loss expense for off-balance sheet commitments of $175,000.

The credit loss expense for loans of $62,000 for the three months ended March 31, 2025 was primarily due to an increase in the multi-family loan portfolio.

The credit loss expense for off-balance sheet commitments of $175,000 for the three months ended March 31, 2025 was primarily due to an increase in unfunded off-balance sheet commitments.

With respect to the allowance for credit losses for loans, we charged-off $27,000 during the quarter ended March 31, 2026, as compared to charge-offs of $117,000 during the quarter ended March 31, 2025.

The charge-offs during both periods were against various unpaid overdrafts in our demand deposit accounts.

We recorded recoveries of $534,000 during the nine months ended September 30, 2025 compared to no recoveries during the nine months ended September 30, 2024.

The recoveries of $534,000 during the nine months ended September 30, 2025 were comprised of recoveries of $350,000 with respect to a previously charged-off non-residential mortgage loan and $184,000 from previously charged-off unpaid overdrafts on demand deposit accounts.

We recorded no recoveries during the quarter ended March 31, 2026 compared to recoveries of $352,000 during the quarter ended March 31, 2025.

The recoveries of $352,000 during the quarter ended March 31, 2025 were comprised of recoveries of $350,000 regarding a previously charged-off non-residential mortgage loan and $2,000 from a previously charged-off unpaid overdraft on a demand deposit account.

Non-Interest Income

Non-interest income for the nine months ended September 30, 2025 was $3.1 million compared to non-interest income of $2.6 million for the nine months ended September 30, 2024.

The increase of $473,000, or 18.0%, in total non-interest income was primarily due to increases of $376,000 in other loan fees and service charges, $76,000 in unrealized gain on equity securities, and $28,000 in BOLI income, partially offset by a decrease of $7,000 in miscellaneous other non-interest income.

The increase of $376,000 in other loan fees and service charges was due to increases of $231,000 in other loan fees and loan servicing fees, $141,000 in ATM/debit card/ACH fees, and $4,000 in deposit account fees.

The increase in unrealized gain on equity securities was due to an unrealized gain of $521,000 on equity securities during the nine months ended September 30, 2025 compared to an unrealized gain of $445,000 on equity securities during the nine months ended September 30, 2024.

Both the unrealized gains on equity securities during the 2024 and 2025 periods were due to market interest rate volatility during the respective periods.

The increase in BOLI income of $28,000 was due to an increase in the yield on BOLI assets.

Non-interest income for the three months ended March 31, 2026 was $796,000 compared to non-interest income of $1.2 million for the three months ended March 31, 2025.

The decrease of $439,000, or 35.5%, in total non-interest income was primarily due to decreases of $421,000 in unrealized gain/(loss) on equity securities and $71,000 in other loan fees and service charges, partially offset by increases of $41,000 in miscellaneous other non-interest income and $12,000 in BOLI income.

The decrease in unrealized gain/(loss) on equity securities was due to an unrealized loss of $121,000 on equity securities during the quarter ended March 31, 2026 compared to an unrealized gain of $300,000 on equity securities during the quarter ended March 31, 2025.

The unrealized loss of $121,000 and unrealized gain of $300,000 on equity securities during the quarters ended March 31, 2026 and 2025, respectively, were due to market interest rate volatility during both periods.

The decrease of $71,000 in other loan fees and service charges was due to a decrease of $143,000 in miscellaneous loan fees, partially offset by an increase of $72,000 in ATM/debit card/ACH fees.

The increase of $41,000 in miscellaneous other non-interest income was due to general accrual adjustments during the quarter.

The increase of $12,000 in BOLI income was due to an increase in the yield on BOLI assets.

Non-Interest Expense

Non-interest expense increased $2.3 million, or 8.0%, to $31.5 million for the nine months ended September 30, 2025 from $29.1 million for the nine months ended September 30, 2024.

The increase resulted primarily from increases of $1.3 million in salaries and employee benefits, $529,000 in other operating expense, $384,000 in outside data processing expense, $111,000 in occupancy expense, $34,000 in equipment expense, and $30,000 in advertising expense, partially offset by a decrease of $12,000 in real estate owned expense,

Salaries and employee benefits increased $1.3 million, or 8.0%, to $17.0 million for the nine months ended September 30, 2025 from $15.7 million for the nine months ended September 30, 2024 primarily due to the hiring of additional personnel to support the growth of the Company and an increase in employee compensation and benefits expense in order to retain key personnel, partially offset by an increase in loan origination offset expenses.

Other non-interest expense increased $530,000, or 6.7%, to $8.4 million for the nine months ended September 30, 2025 from $7.9 million for the nine months ended September 30, 2024 due mainly to increases of $270,000 in legal fees, $203,000 in miscellaneous other non-interest expense, $130,000 in regulatory fess, $73,000 in dues and subscriptions, $30,000 in recruitment expenses, $14,000 in audit and accounting fees, and $9,000 in service contracts expense.

These increases were partially offset by decreases of $77,000 in consulting fees, $43,000 in directors compensation, $40,000 in telephone expense, $25,000 in directors, officers, and employee expenses, $9,000 in insurance expense, and $8,000 in office supplies.

Legal fees increased $270,000, or 100.4%, to $539,000 for the nine months ended September 30, 2025 from $269,000 for the nine months ended September 30, 2024 due to legal proceedings to resolve problem loans, recovery efforts for losses incurred from previously charged-off loans and overdrafts, and general legal services.

The increase of $204,000 in miscellaneous other non-interest expense was mainly due to increases of $69,000 in miscellaneous charge-offs, $60,000 in miscellaneous expenses, $47,000 in public company expenses, $18,000 in check and correspondence bank charges, and $9,000 in postage expense.

Regulatory fees increased $131,000, or 5.8%, to $2.4 million for the nine months ended September 30, 2025 from $2.3 million for the nine months ended September 30, 2024 due to an increase in our total assets.

Dues and subscriptions increased $73,000, or 12.7%, to $647,000 for the nine months ended September 30, 2025 from $574,000 for the nine months ended September 30, 2024 due to an increase in dues and subscriptions for general corporate purposes.

Recruiting expense increased $30,000, or 100.0%, to $60,000 for the nine months ended September 30, 2025 from $30,000 for the nine months ended September 30, 2024 due to our increased usage of traditional recruiting firms in 2025 for personnel hirings.

Audit and accounting expense increased $14,000, or 3.5%, to $420,000 for the nine months ended September 30, 2025 from $406,000 for the nine months ended September 30, 2024 due to normal increases by the Company’s accounting firms.

Service contracts expense increased $9,000, or 0.7%, to $1.3 million for the nine months ended September 30, 2025 from $1.3 million for the nine months ended September 30, 2024 due to the increased cost to support the growth of the Company.

Consultant fees decreased $77,000, or 13.1%, to $513,000 for the nine months ended September 30, 2025 from $590,000 for the nine months ended September 30, 2024 due to less reliance on consultants in 2025.

Directors’ compensation decreased $43,000, or 6.0%, to $676,000 for the nine months ended September 30, 2025 from $719,000 for the nine months ended September 30, 2024 due to a reduction in the amortization expense related to the 2022 Equity Incentive Plan.

Due to efforts to contain cost, telephone expense decreased $40,000, or 8.4%, to $438,000 for the nine months ended September 30, 2025 from $478,000 for the nine months ended September 30, 2024, directors, officers, and employee expenses decreased $25,000, or 10.5%, to $213,000 for the nine months ended September 30, 2025 from $238,000 for the nine months ended September 30, 2024, insurance expense decreased $8,000, or 2.5%, to $310,000 for the nine months ended September 30, 2025 from $318,000 for the nine months ended September 30, 2024, and office supplies expense decreased $8,000, or 5.4%, to $140,000 for the nine months ended September 30, 2025 from $148,000 for the nine months ended September 30, 2024.

Outside data processing expense increased $383,000, or 19.9%, to $2.3 million for the nine months ended September 30, 2025 from $1.9 million for the nine months ended September 30, 2024 due to an increase in transactions and additional data processing services.

Occupancy expense increased $111,000, or 5.2%, to $2.2 million for the nine months ended September 30, 2025 from $2.1 million for the nine months ended September 30, 2024 primarily as a result of the increased cost of operating office space.

Equipment expense increased $34,000, or 5.1%, to $695,000 for the nine months ended September 30, 2025 from $661,000 for the nine months ended September 30, 2024 due to upgrades of equipment.

Advertising expense increased $30,000, or 9.7%, to $340,000 for the nine months ended September 30, 2025 from $310,000 for the nine months ended September 30, 2024 due to an increase in various marketing campaigns.

Real estate owned expense decreased $12,000, or 2.3%, to $515,000 for the nine months ended September 30, 2025 from $527,000 for the nine months ended September 30, 2024 due to a reduction in charge-offs.

We recorded a charge-off of $478,000 on a foreclosed property during the nine months ended September 30, 2024 compared to a charge-off of $222,000 on a foreclosed property during the nine months ended September 30, 2025, partially offset by closing cost expense of $231,000 associated with the sale of a foreclosed property during the nine months ended September 30, 2025.

The write down of $222,000 on the fair market value of a foreclosed property during the nine months ended September 30, 2025 was due to the office occupancy rate in the Pittsburgh business district office market continuing to deteriorate due to workers continuing to work remotely post pandemic and the high operating expenses due to inflation.

We recorded income tax expense of $13.1 million and $14.4 million for the nine months ended September 30, 2025 and 2024, respectively.

For the nine months ended September 30, 2025, we had approximately $630,000 in tax exempt income, compared to approximately $597,000 in tax exempt income for the nine months ended September 30, 2024.

Our effective income tax rates were 28.0% and 28.1% for the nine months ended September 30, 2025 and 2024, respectively.

Non-interest expense increased $260,000, or 2.4%, to $10.9 million for the three months ended March 31, 2026 from $10.6 million for the three months ended March 31, 2025.

The increase resulted primarily from increases of $239,000 in salaries and employee benefits, $127,000 in occupancy expense, $61,000 in outside data processing expense, and $6,000 in equipment expense, partially offset by decreases of $84,000 in other operating expense, $59,000 in advertising expense, and $30,000 in real estate owned expense.

Salaries and employee benefits increased $239,000, or 4.0%, to $6.2 million for the three months ended March 31, 2026 from $5.9 million for the three months ended March 31, 2025 primarily due to the hiring of additional personnel to support the growth of the Company and an increase in employee compensation and benefits expense in order to retain key personnel, partially offset by an increase in loan origination offset expenses.

Occupancy expense increased $128,000, or 17.1%, to $874,000 for the three months ended March 31, 2026 from $747,000 for the three months ended March 31, 2025 primarily due to repairs and maintenance at various offices, increased utilities cost, and increased snow removal cost.

Outside data processing expense increased $61,000, or 8.2%, to $796,000 for the three months ended March 31, 2026 from $735,000 for the three months ended March 31, 2025 due to additional data processing services.

Equipment expense increased $6,000, or 2.6%, to $223,000 for the three months ended March 31, 2026 from $217,000 for the three months ended March 31, 2025 due to upgrades of equipment.

Other non-interest operating expense decreased $84,000, or 2.9%, to $2.8 million for the three months ended March 31, 2026 from $2.9 million for the three months ended March 31, 2025 due mainly to decreases of $105,000 in miscellaneous other non-interest expense, $24,000 in recruitment expense, $21,000 in office supplies, $16,000 in telephone expense, $12,000 in consulting fees, and $8,000 in audit and accounting expense.

These decreases were partially offset by increases of $31,000 in service contracts expense, $27,000 in legal fees, $21,000 in directors, officers and employees expense, $19,000 in directors compensation, and $6,000 in insurance expense.

The decrease of $105,000 in miscellaneous other non-interest expense was mainly due to decreases of $112,000 in regulatory fees, $19,000 in miscellaneous expenses, $12,000 in dues and subscriptions, $3,000 in public company expenses, and $3,000 in postage expenses, partially offset by increases of $23,000 in miscellaneous charge-offs, $12,000 in loan related expenses, and $10,000 in check and correspondence bank charges.

Regulatory fees decreased $112,000, or 13.2%, to $738,000 for the three months ended March 31, 2026 from $850,000 for the three months ended March 31, 2025 due to a reduction in the Bank’s risk profile between periods.

Advertising expense decreased $59,000, or 57.7%, to $43,000 for the three months ended March 31, 2026 from $102,000 for the three months ended March 31, 2025 due to a decrease in various marketing campaigns.

Real estate owned expense decreased $30,000 to none for the three months ended March 31, 2026 from $30,000 for the three months ended March 31, 2025 due to the sale in December 2025 of the sole real estate owned located in Pittsburgh, Pennsylvania.

We recorded income tax expense of $4.1 million for both three months ended March 31, 2026 and 2025, respectively.

For the three months ended March 31, 2026, we had approximately $248,000 in tax exempt income, compared to approximately $204,000 in tax exempt income for the three months ended March 31, 2025.

Our effective income tax rate was 29.2% for the three months ended March 31, 2026 compared to 27.8% for the three months ended March 31, 2025.

Average Balances and Yields

5 unchanged sentences

Any adjustments necessary to present yields on a tax-equivalent basis are insignificant.

Three Months Ended September 30,

Three Months Ended March 31,

Loans receivable

Federal Home Loan Bank stock

Other interest-earning assets

Total interest-earning assets

Allowance for credit losses

Non-interest-earning assets

Interest bearing demand

Savings and club accounts

Certificates of deposit

Interest-bearing deposits

Borrowed money

Interest-bearing liabilities

Non-interest-bearing demand

Other non-interest-bearing liabilities

Total liabilities

Total liabilities and equity

Net interest income/interest spread

Net interest margin

Net interest-earning assets

Average interest-earning assets to interest-bearing liabilities

Nine Months Ended September 30,

Loans receivable

Securities (1)

Federal Home Loan Bank stock

Other interest-earning assets

Total interest-earning assets

27 unchanged sentences

Federal Home Loan Bank stock

Other interest-earning assets

Interest expense:

Interest bearing demand deposit

Savings accounts

Certificates of deposits

Borrowed money

Net change in net interest income

Nine Months Ended 9/30/2025

Nine Months Ended 9/30/2024

Increase (Decrease)

(Dollars in thousands)

Interest income:

Loans receivable

Federal Home Loan Bank stock

Other interest-earning assets

Interest-bearing deposits

Interest expense:

5 unchanged sentences

Asset Quality

The following table sets forth information with respect to our non-performing assets at the dates indicated.

September 30,

(Dollars in thousands)

Total non-accrual loans

Total accruing loans past due 90 days or more

Total non-performing loans

Real estate owned

Total non-performing assets

Total non-performing loans to total loans

Total non-performing assets to total assets

Non-performing assets totaled $545,000 at September 30, 2025 compared to $5.1 million at December 31, 2024.

Non-performing assets at September 30, 2025 consisted of one foreclosed property located in Pittsburgh, Pennsylvania compared to two foreclosed properties at December 31, 2024.

We sold one foreclosed property totaling $4.3 million located in the Bronx, New York on September 30, 2025 to a third-party buyer at no loss to the Company and, in connection therewith, we provided the financing to complete the multi-family project.

We charged-off $222,000 against the foreclosed property in Pittsburgh during the nine months ended September 30, 2025 due to the office occupancy rate in the Pittsburgh business district office market continuing to deteriorate due to workers continuing to work remotely post pandemic and the high operating expenses due to inflation.

During the three and nine months ended September 30, 2025 and 2024, we did not collect any interest income from loans that were in non-accrual status.

We had no non-performing assets at March 31, 2026 and at December 31, 2025.

During the three months ended March 31, 2026 and 2025, we did not collect any interest income from loans that were in non-accrual status.

From time to time, as part of our loss mitigation strategy, we may modify loans to borrowers in financial distress by providing principal forgiveness, term extension, an other-than-insignificant payment delay, or interest rate reduction.

When principal forgiveness is provided, the amount of forgiveness is charged-off against the allowance for credit losses.

There were no new loan modifications to borrowers experiencing financial difficulties during the three and nine months ended September 30, 2025 or 2024.

At September 30, 2025 and December 31, 2024, we had no loans modified to borrowers experiencing financial difficulty.

There were no new loan modifications to borrowers experiencing financial difficulties during the three months ended March 31, 2026 or 2025.

At March 31, 2026 and December 31, 2025, we had no loans modified to borrowers experiencing financial difficulty.

The following table sets forth an analysis of the activity in the allowance for credit losses related to loans for the periods indicated:

September 30,

(Dollars In Thousands)

1 unchanged sentence

Provision for credit losses

Net Charge-offs:

Net Charge-offs (recovery):

Residential real estate loans:

5 unchanged sentences

Consumer loans

Total net charge-offs

Total net charge-offs (recovery)

Allowance at end of period

3 unchanged sentences

Ratio of allowance to total loans

Ratio of net charge-offs to average loans

Ratio of net charge-offs (recovery) to average loans

Non-performing loans

The Company’s allowance for credit losses related to loans totaled $4.7 million, or 0.25% of total loans as of September 30, 2025 compared to $4.8 million, or 0.27% of total loans as of December 31, 2024.

In addition, the Company’s allowance for credit losses related to off-balance sheet commitments totaled $879,000 as of September 30, 2025 compared to $704,000 at December 31, 2024.

The allowance for credit losses related to held-to-maturity debt securities totaled $126,000 at both September 30, 2025 and December 31, 2024.

The allowance for credit losses related to loans decreased $82,000 to $4.7 million at September 30, 2025 from $4.8 million at December 31, 2024.

The decrease in the allowance for credit losses was due primarily to charge-offs totaling $677,000, partially offset by recoveries of $533,000 and a credit loss expense of $62,000.

The allowance for credit losses related to off-balance sheet commitments increased $175,000 to $879,000 at September 30, 2025 from $704,000 due to a credit loss expense of $175,000 at September 30, 2025.

The Company’s allowance for credit losses related to loans totaled $4.6 million, or 0.25% of total loans as of March 31, 2026 compared to $4.7 million, or 0.25% of total loans as of December 31, 2025.

In addition, the Company’s allowance for credit losses related to off-balance sheet commitments totaled $991,000 as of March 31, 2026 compared to $879,000 at December 31, 2025.

The allowance for credit losses related to held-to-maturity debt securities totaled $126,000 at both March 31, 2026 and December 31, 2025.

The allowance for credit losses related to loans decreased $139,000 to $4.6 million at March 31, 2026 from $4.7 million at December 31, 2025 due primarily to charge-offs totaling $27,000, and a provision for credit losses reduction of $112,000 due to a reduction in the loan portfolio.

The allowance for credit losses related to off-balance sheet commitments increased $112,000 to $991,000 at March 31, 2026 from $879,000 at December 31, 2025 due to a provision for credit losses of $112,000 due to an increase in outstanding commitments between periods.

Liquidity and Capital Resources

2 unchanged sentences

We also establish targets of 2.0% for the Cash Liquidity ratio, 5.0% for the On Balance Sheet Liquidity ratio, and 20.0% for the On Balance Sheet Liquidity & Borrowing Capacity ratio.

Our Cash Liquidity ratio, On Balance Sheet Liquidity ratio, and On Balance Sheet Liquidity & Borrowing Capacity ratio averaged 5.4%, 7.7%, and 61.2%, respectively, for the nine months ended September 30, 2025 compared to 6.7%, 8.8%, and 65.6%, respectively, for the year ended December 31, 2024.

Our Cash Liquidity ratio, On Balance Sheet Liquidity ratio, and On Balance Sheet Liquidity & Borrowing Capacity ratio averaged 4.3%, 7.1%, and 59.6%, respectively, for the three months ended March 31, 2026 compared to 5.0%, 7.4%, and 59.9%, respectively, for the year ended December 31, 2025.

We adjust our liquidity levels to fund deposit outflows, pay real estate taxes on real estate loans, repay our borrowings, and fund loan commitments.

25 unchanged sentences

To assess the adequacy of its liquidity, the Company compares time-series liquidity against Total Non-Contractual Deposits defined as total deposits less (1) brokered deposits outstanding, (2) other contractual funding outstanding, and (3) collateralized municipal deposits outstanding.

As of September 30, 2025, the Company’s ratios of Cash and Borrowing Capacity/Total Non-Contractual Deposits and Cash, Borrowing Capacity and Sourced Deposits Capacity/Total Non-Contractual Deposits were 71.1% and 95.5%, respectively.

As of March 31, 2026, the Company’s ratios of Cash and Borrowing Capacity/Total Non-Contractual Deposits and Cash, Borrowing Capacity and Sourced Deposits Capacity/Total Non-Contractual Deposits were 73.4% and 121.2%, respectively.

These figures demonstrate that the Company has sufficient liquidity resources to meet sudden and unexpected deposit outflow.

5 unchanged sentences

Our primary investing activities are the origination of construction loans, commercial and industrial loans, multifamily loans, and to a lesser extent, mixed-use real estate loans and other loans.

For the nine months ended September 30, 2025 and 2024, our loan originations totaled $714.3 million and $569.2 million, respectively.

Cash received from the maturities and pay-downs on securities totaled $814,000 and $805,000 for the nine months ended September 30, 2025 and 2024, respectively.

We purchased $3.0 million in equity securities and $2.5 million in municipal securities during the nine months ended September 30, 2025 compared to purchases of $2.0 million in equity securities during the nine months ended September 30, 2024.

For the three months ended March 31, 2026 and 2025, our loan originations totaled $266.1 million and $170.1 million, respectively.

Cash received from the maturities and pay-downs on securities totaled $155,000 and $128,000 for the three months ended March 31, 2026 and 2025, respectively.

We purchased $1.0 million in equity securities during the three months ended March 31, 2026 compared to purchases of $1.0 million in equity securities during the three months ended March 31, 2025.

Liquidity management is both a daily and long-term function of business management.

If we require funds beyond our ability to generate them internally, borrowing agreements exist with the Federal Home Loan Bank of New York to provide advances.

As a member of the Federal Home Loan Bank of New York, we are required to own capital stock in the Federal Home Loan Bank of New York and are authorized to apply for advances on the security of such stock and certain of our mortgage loans and other assets (principally securities which are obligations of, or guaranteed by, the United States), provided certain standards related to credit-worthiness have been met.

We had an available borrowing limit of $38.5 million and $18.2 million from the Federal Home Loan Bank of New York as of September 30, 2025 and December 31, 2024, respectively.

We had no Federal Home Loan Bank advances at September 30, 2025 and December 31, 2024.

The Federal Reserve Bank of New York (“FRBNY”) approved on August 30, 2023 the Bank’s eligibility to pledge loans under the Borrower-in-Custody program of the FRBNY thereby allowing the Bank to borrow from the Discount Window at the FRBNY.

We had an available borrowing limit of $740.2 million and $834.7 million from the FRBNY as of September 30, 2025 and December 31, 2024, respectively.

We had $170.0 million in FRBNY borrowings at September 30, 2025 compared to none at December 31, 2024.

If we require funds beyond our ability to generate them internally, borrowing agreements exist with the Federal Reserve Bank of New York (“FRBNY”) whereby the Bank pledged eligible loans under the Borrower-in-Custody program of the FRBNY allowing the Bank to borrow from the Discount Window at the FRBNY.

We had an available borrowing limit of $866.7 million and $768.8 million from the FRBNY at March 31, 2026 and December 31, 2025, respectively.

We had $20.0 million in FRBNY borrowings at March 31, 2026 compared to $70.0 million in FRBNY borrowings at December 31, 2025.

As a member of the Federal Home Loan Bank of New York (“FHLB-NY”), we are required to own capital stock in the FHLB-NY and are authorized to apply for advances on the security of such stock and certain of our mortgage loans and other assets (principally securities which are obligations of, or guaranteed by, the United States), provided certain standards related to credit-worthiness have been met.

In February 2026, we withdrew our pledged eligible loans from the FHLB-NY’s advance program and are in the process of pledging these eligible loans with the FRB-NY to increase our borrowing capacity with the FRB-NY.

Due to the withdrawal of pledged eligible loans from the FHLB-NY, we no longer have borrowing capacity at the FHLB-NY at March 31, 2026 compared to borrowing capacity at the FHLB-NY of $35.8 million at December 31, 2025.

We had no FHLB-NY advances at March 31, 2026 and December 31, 2025.

In addition, we are party to a loan agreement with ACBB under which we can borrow up to $8.0 million in short-term borrowings.

There were no outstanding borrowings with ACBB at September 30, 2025 and December 31, 2024.

At September 30, 2025, we had unfunded commitments on construction and multi-family mortgage loans of $404.9 million, outstanding commitments to originate loans of $144.9 million, unfunded commitments under lines of credit of $81.8 million, and unfunded standby letters of credit of $13.9 million.

At September 30, 2025, certificates of deposit scheduled to mature in less than one year totaled $690.7 million.

There were no outstanding borrowings with ACBB at March 31, 2026 and December 31, 2025.

At March 31, 2026, we had unfunded commitments on construction and multi-family mortgage loans of $429.5 million, outstanding commitments to originate loans of $297.1 million, unfunded commitments under commercial and industrial loans lines of credit of $78.9 million, and unfunded standby letters of credit of $14.2 million.

At March 31, 2026, certificates of deposit scheduled to mature in less than one year totaled $796.2 million.

Based on prior experience, management believes that a significant portion of such deposits will remain with us, although there can be no assurance that this will be the case.

In the event a significant portion of our deposits are not retained by us, we will have to utilize other funding sources, such as various types of sourced deposits, Federal Home Loan Bank advances, or Federal Reserve Bank borrowings, in order to maintain our level of assets.

In the event a significant portion of our deposits are not retained by us, we will have to utilize other funding sources, such as various types of sourced deposits, or Federal Reserve Bank borrowings, in order to maintain our level of assets.

Alternatively, we could reduce our level of liquid assets, such as our cash and cash equivalents.

2 unchanged sentences

In addition to its operating expenses, the Company is responsible for paying any dividends declared to its stockholders and for the repurchase, if any, of its shares of common stock.

At September 30, 2025, the Company had liquid assets of $9.4 million and $4.1 million in loan participations originated by the Bank which are held by the Company.

At March 31, 2026, the Company had liquid assets of $8.8 million and $3.1 million in loan participations originated by the Bank which are held by the Company.

Off-Balance Sheet Arrangements

For the three and nine months ended September 30, 2025, we did not engage in any off-balance sheet transactions reasonably likely to have a material adverse effect on our financial condition, results of operations or cash-flows.

For the three months ended March 31, 2026, we did not engage in any off-balance sheet transactions reasonably likely to have a material adverse effect on our financial condition, results of operations or cash-flows.

Impact of Inflation and Changing Prices

4 unchanged sentences

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis