NorthEast Community Bancorp, Inc./MD/ 10-Q

Item 1. Financial Statements NORTHEAST COMMUNITY BANCORP, INC. CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, ​ December 31, ​ 2022 2021 ​ ​ (In thousands, except share ​ ​ and per share amounts) ASSETS ​ ​ ​ ​ ​ ​ Cash and amounts due from depository institutions ​ $ 14,182 ​ $ 8,344 Interest-bearing deposits ​ 40,750 ​ 143,925 Total cash and cash equivalents ​ 54,932 ​ 152,269 Certificates of deposit ​ 100 ​ 100 Equity securities ​ 18,307 ​ 19,943 Securities available-for-sale, at fair value ​ 1 ​ 1 Securities held-to-maturity (fair value of  $ 22,900 and $ 17,620 , respectively) ​ 26,732 ​ 17,880 Loans receivable ​ 1,117,417 ​ 972,851 Deferred loan costs, net ​ ​ 551 ​ ​ 484 Allowance for loan losses ​ ​ ( 5,461 ) ​ ​ ( 5,242 ) Net loans ​ ​ 1,112,507 ​ 968,093 Premises and equipment, net ​ 26,349 ​ 23,907 Investments in restricted stock, at cost ​ 1,238 ​ 1,569 Bank owned life insurance ​ 25,741 ​ 25,291 Accrued interest receivable ​ 6,635 ​ 4,283 Goodwill ​ 651 ​ 651 Real estate owned ​ 1,807 ​ 1,996 Property held for investment ​ 1,453 ​ 1,481 Right of Use Assets – Operating ​ 2,161 ​ 2,564 Right of Use Assets – Financing ​ 356 ​ 359 Other assets ​ 5,935 ​ 4,683 Total assets ​ $ 1,284,905 ​ $ 1,225,070 LIABILITIES AND STOCKHOLDERS’ EQUITY ​ ​ Liabilities: ​ ​ Deposits: ​ ​ Non-interest bearing ​ $ 354,336 ​ $ 330,853 Interest bearing ​ 633,288 ​ 596,311 Total deposits ​ 987,624 ​ 927,164 Advance payments by borrowers for taxes and insurance ​ 2,297 ​ 1,884 Federal Home Loan Bank advances ​ 21,000 ​ 28,000 Lease Liability – Operating ​ 2,210 ​ 2,604 Lease Liability – Financing ​ 524 ​ 496 Accounts payable and accrued expenses ​ 11,213 ​ 13,540 Total liabilities ​ 1,024,868 ​ 973,688 ​ ​ ​ ​ See notes to interim unaudited consolidated financial statements. ​ 3 Table of Contents NORTHEAST COMMUNITY BANCORP, INC. CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (continued) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, ​ December 31, ​ 2022 2021 ​ ​ (In thousands, except share ​ ​ and per share amounts) Stockholders’ equity: ​ ​ Preferred stock, $ 0.01 par value; 25,000,000 shares authorized; none issued or outstanding $ — $ — Common stock, $ 0.01 par value; 75,000,000 shares authorized; 16,214,528 shares and 16,377,936 shares issued and outstanding , respectively ​ ​ 162 ​ ​ 164 Additional paid-in capital ​ 142,265 ​ ​ 145,335 Unearned Employee Stock Ownership Plan (“ESOP”) shares ​ ( 7,649 ) ​ ​ ( 8,301 ) Retained earnings ​ 125,334 ​ ​ 114,323 Accumulated other comprehensive loss ​ ( 75 ) ​ ​ ( 139 ) Total stockholders’ equity ​ 260,037 ​ 251,382 Total liabilities and stockholders’ equity ​ $ 1,284,905 ​ $ 1,225,070 ​ ​ See notes to interim unaudited consolidated financial statements. ​ 4 Table of Contents NORTHEAST COMMUNITY BANCORP, INC. CONSOLIDATED STATEMENTS OF INCOME (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ Nine Months Ended September 30, ​ ​ 2022 2021 2022 2021 ​ ​ ​ (In thousands, except per share amounts) ​ INTEREST INCOME: ​ ​ ​ ​ ​ ​ Loans ​ $ 18,771 ​ $ 11,935 ​ $ 46,244 ​ $ 35,237 ​ Interest-earning deposits ​ 414 ​ ​ 53 ​ 718 ​ ​ 74 ​ Securities ​ 199 ​ ​ 104 ​ 534 ​ ​ 277 ​ Total Interest Income ​ 19,384 ​ 12,092 ​ 47,496 ​ 35,588 ​ INTEREST EXPENSE: ​ ​ ​ ​ ​ Deposits ​ 1,786 ​ ​ 995 ​ 4,123 ​ ​ 3,390 ​ Borrowings ​ 129 ​ ​ 178 ​ 417 ​ ​ 528 ​ Financing lease ​ 9 ​ ​ 9 ​ 28 ​ ​ 27 ​ Total Interest Expense ​ 1,924 ​ 1,182 ​ 4,568 ​ 3,945 ​ Net Interest Income ​ 17,460 ​ 10,910 ​ 42,928 ​ 31,643 ​ Provision for loan loss ​ — ​ 3,593 ​ — ​ 3,610 ​ Net Interest Income after Provision for Loan Losses ​ 17,460 ​ 7,317 ​ 42,928 ​ 28,033 ​ NON-INTEREST INCOME: ​ ​ ​ ​ ​ Other loan fees and service charges ​ 544 ​ ​ 381 ​ 1,562 ​ ​ 1,095 ​ Gain on disposition of equipment ​ 52 ​ ​ — ​ 98 ​ ​ 7 ​ Earnings on bank owned life insurance ​ 153 ​ ​ 152 ​ 450 ​ ​ 447 ​ Investment advisory fees ​ 107 ​ ​ 139 ​ 364 ​ ​ 381 ​ Unrealized loss on equity securities ​ ( 573 ) ​ ​ ( 154 ) ​ ( 1,636 ) ​ ​ ( 215 ) ​ Other ​ 26 ​ ​ 14 ​ 66 ​ ​ 38 ​ Total Non-Interest Income ​ 309 ​ 532 ​ 904 ​ 1,753 ​ NON-INTEREST EXPENSES: ​ ​ ​ ​ ​ Salaries and employee benefits ​ 3,979 ​ ​ 4,054 ​ 11,420 ​ ​ 11,223 ​ Occupancy expense ​ 598 ​ ​ 489 ​ 1,763 ​ ​ 1,534 ​ Equipment ​ 259 ​ ​ 229 ​ 825 ​ ​ 718 ​ Outside data processing ​ 473 ​ ​ 395 ​ 1,388 ​ ​ 1,218 ​ Advertising ​ 78 ​ ​ 36 ​ 183 ​ ​ 83 ​ Real estate owned expense ​ 199 ​ ​ 18 ​ 252 ​ ​ 85 ​ Other ​ 2,237 ​ ​ 1,633 ​ 6,220 ​ ​ 4,857 ​ Total Non-Interest Expenses ​ 7,823 ​ 6,854 ​ 22,051 ​ 19,718 ​ INCOME BEFORE PROVISION FOR INCOME TAXES ​ 9,946 ​ 995 ​ 21,781 ​ 10,068 ​ PROVISION FOR INCOME TAXES ​ 2,404 ​ 265 ​ 5,201 ​ 2,372 ​ NET INCOME ​ $ 7,542 ​ $ 730 ​ $ 16,580 ​ $ 7,696 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ EARNINGS PER COMMON SHARE – BASIC AND DILUTED ​ $ 0.49 ​ $ 0.05 ​ $ 1.07 ​ $ 0.48 ​ WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING – BASIC AND DILUTED ​ 15,536 ​ ​ 15,572 ​ ​ 15,515 ​ ​ 15,973 ​ ​ See notes to interim unaudited consolidated financial statements. ​ 5 Table of Contents NORTHEAST COMMUNITY BANCORP, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ Nine Months Ended September 30, ​ ​ 2022 2021 2022 2021 ​ ​ ​ (In thousands) ​ (In thousands) ​ Net Income ​ $ 7,542 ​ $ 730 ​ $ 16,580 ​ $ 7,696 ​ Other comprehensive income (loss): ​ ​ ​ ​ ​ Defined benefit pension: ​ ​ ​ ​ ​ ​ ​ Reclassification adjustments out of accumulated other comprehensive income: ​ ​ ​ ​ ​ Amortization of actuarial loss ¹ ​ 7 ​ 8 ​ 20 ​ 24 ​ Actuarial loss (gain) arising during period ​ 23 ​ ( 14 ) ​ 63 ​ ( 35 ) ​ Total ​ 30 ​ ( 6 ) ​ 83 ​ ( 11 ) ​ Income tax effect ² ​ ( 7 ) ​ — ​ ( 19 ) ​ 2 ​ Total other comprehensive income (loss) ​ 23 ​ ( 6 ) ​ 64 ​ ( 9 ) ​ Total Comprehensive Income ​ $ 7,565 ​ $ 724 ​ $ 16,644 ​ $ 7,687 ​ ¹ Amounts are included in salaries and employees benefits in the consolidated statements of income as part of net periodic pension cost. See Note 9 for further information. ² Amounts are included in provision for income taxes in the consolidated statements of income. ​ See notes to interim unaudited consolidated financial statements. ​ 6 Table of Contents NORTHEAST COMMUNITY BANCORP, INC. CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY Three and Nine Months Ended September 30, 2022 and 2021 (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ ​ ​ ​ ​ Number of ​ Common ​ Paid- in ​ Unearned ​ Retained ​ Treasury ​ Comprehensive ​ ​ ​ ​ Shares, net Stock Capital ESOP Shares Earnings Stock Loss Total ​ ​ (In thousands, except share and per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance – December 31, 2021 ​ ​ 16,377,936 ​ $ 164 ​ $ 145,335 ​ $ ( 8,301 ) ​ $ 114,323 ​ $ - ​ $ ( 139 ) ​ $ 251,382 Net income ​ — ​ — ​ — ​ — ​ 3,645 ​ — ​ — ​ 3,645 Other comprehensive income ​ — ​ — ​ — ​ — ​ — ​ — ​ 19 ​ 19 Cash dividend declared ($ 0.06 per share) ​ — ​ — ​ — ​ — ​ ( 931 ) ​ — ​ — ​ ( 931 ) ESOP shares earned ​ — ​ — ​ 41 ​ 217 ​ — ​ — ​ — ​ 258 Balance – March 31, 2022 ​ ​ 16,377,936 ​ $ 164 ​ $ 145,376 ​ $ ( 8,084 ) ​ $ 117,037 ​ $ - ​ $ ( 120 ) ​ $ 254,373 Net income ​ — ​ — ​ — ​ — ​ 5,393 ​ — ​ — ​ 5,393 Other comprehensive income ​ — ​ — ​ — ​ — ​ — ​ — ​ 22 ​ 22 Cash dividend declared ($ 0.24 per share) ​ — ​ — ​ — ​ — ​ ( 3,722 ) ​ — ​ — ​ ( 3,722 ) ESOP shares earned ​ — ​ — ​ 28 ​ 218 ​ — ​ — ​ — ​ 246 Balance – June 30, 2022 ​ ​ 16,377,936 ​ $ 164 ​ $ 145,404 ​ $ ( 7,866 ) ​ $ 118,708 ​ $ - ​ $ ( 98 ) ​ $ 256,312 Net income ​ — ​ — ​ — ​ — ​ 7,542 ​ — ​ — ​ 7,542 Other comprehensive income ​ — ​ — ​ — ​ — ​ — ​ — ​ 23 ​ 23 Cash dividend declared ($ 0.06 per share) ​ — ​ — ​ — ​ — ​ ( 916 ) ​ — ​ — ​ ( 916 ) Stock Repurchases ​ ​ ( 250,288 ) ​ ​ ( 3 ) ​ ​ ( 3,192 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 3,195 ) Restricted Stock Award ​ ​ 86,880 ​ ​ 1 ​ ​ ( 1 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ESOP shares earned ​ — ​ — ​ 54 ​ 217 ​ — ​ — ​ — ​ 271 Balance – September 30, 2022 ​ ​ 16,214,528 ​ $ 162 ​ $ 142,265 ​ $ ( 7,649 ) ​ $ 125,334 ​ $ — ​ $ ( 75 ) ​ $ 260,037 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ ​ ​ ​ ​ Number of ​ Common ​ Paid- in ​ Unearned ​ Retained ​ Treasury ​ Comprehensive ​ ​ ​ ​ Shares, net ¹ Stock Capital ESOP Shares Earnings Stock Loss Total ​ ​ (In thousands, except share and per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance – December 31, 2020 ​ ​ 17,721,500 ​ $ 132 ​ $ 56,901 ​ $ ( 1,296 ) ​ $ 105,305 ​ $ ( 7,032 ) ​ $ ( 185 ) ​ $ 153,825 Net income ​ — ​ — ​ — ​ — ​ 3,245 ​ — ​ — ​ 3,245 Other comprehensive income ​ — ​ — ​ — ​ — ​ — ​ — ​ 3 ​ 3 Cash dividend declared ($ 0.02 per share) ​ — ​ — ​ — ​ — ​ ( 144 ) ​ — ​ — ​ ( 144 ) ESOP shares earned ​ — ​ — ​ 32 ​ 65 ​ — ​ — ​ — ​ 97 Balance - March 31, 2021 ​ ​ 17,721,500 ​ $ 132 ​ $ 56,933 ​ $ ( 1,231 ) ​ $ 108,406 ​ $ ( 7,032 ) ​ $ ( 182 ) ​ $ 157,026 Net income ​ — ​ — ​ — ​ — ​ 3,721 ​ — ​ — ​ 3,721 Other comprehensive income (loss) ​ — ​ — ​ — ​ — ​ — ​ — ​ ( 6 ) ​ ( 6 ) ESOP shares earned ​ — ​ — ​ 41 ​ 65 ​ — ​ — ​ — ​ 106 Balance - June 30, 2021 ​ ​ 17,721,500 ​ $ 132 ​ $ 56,974 ​ $ ( 1,166 ) ​ $ 112,127 ​ $ ( 7,032 ) ​ $ ( 188 ) ​ $ 160,847 Net income ​ — ​ — ​ — ​ — ​ 730 ​ - ​ — ​ 730 Other comprehensive loss ​ — ​ — ​ — ​ — ​ — ​ — ​ ( 6 ) ​ ( 6 ) Cash dividend declared ($ 0.06 per share) ​ — ​ — ​ — ​ — ​ ( 925 ) ​ — ​ — ​ ( 925 ) ESOP shares earned ​ — ​ — ​ 15 ​ 476 ​ — ​ — ​ — ​ 491 Purchase of unearned common stock held by employee stock ownership plan ​ — ​ — ​ — ​ ( 7,828 ) ​ — ​ — ​ — ​ ( 7,828 ) Second-step conversion and stock offering: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Conversion of existing shares ​ ​ 6,593,954 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MHC shares sold in public offering, net of cost ​ ​ 9,784,077 ​ ​ 32 ​ ​ 95,358 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 95,390 Retirement of NECB, MHC shares ​ ​ ( 17,721,500 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fractional shares resulting from conversion of existing shares ​ ​ ( 95 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Treasury stock retired ​ ​ — ​ ​ — ​ ​ ( 7,032 ) ​ ​ — ​ ​ — ​ ​ 7,032 ​ ​ — ​ ​ — Balance - September 30, 2021 ​ ​ 16,377,936 ​ $ 164 ​ $ 145,315 ​ $ ( 8,518 ) ​ $ 111,932 ​ $ - ​ $ ( 194 ) ​ $ 248,699 ¹ Shares amounts related to periods prior to the July 12, 2021 closing of the Company’s second-step conversion offering have been restated to give retroactive recognition to the 1.3400 exchange ratio applied in the conversion offering. See notes to interim unaudited consolidated financial statements. ​ 7 Table of Contents NORTHEAST COMMUNITY BANCORP, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Nine Months Ended September 30, ​ ​ 2022 2021 ​ ​ ​ (In thousands) ​ Cash Flows from Operating Activities: ​ ​ ​ Net income ​ $ 16,580 ​ $ 7,696 ​ Adjustments to reconcile net income to net cash provided by operating activities: ​ ​ ​ Net amortization (accretion) of securities premiums and discounts, net ​ 18 ​ ​ ( 2 ) ​ Provision for loan losses ​ - ​ ​ 3,610 ​ Depreciation ​ 892 ​ ​ 837 ​ Net amortization of deferred loan fees and costs ​ 377 ​ ​ 29 ​ Deferred income tax benefit ​ ( 1,235 ) ​ ​ ( 347 ) ​ Unrealized loss recognized on equity securities ​ 1,636 ​ ​ 215 ​ Impairment of real estate owned ​ 189 ​ ​ - ​ Earnings on bank owned life insurance ​ ( 450 ) ​ ​ ( 447 ) ​ Gain on dispositions of premises and equipment ​ ( 98 ) ​ ​ ( 7 ) ​ ESOP compensation expense ​ 775 ​ ​ 694 ​ Increase in accrued interest receivable ​ ( 2,352 ) ​ ​ ( 196 ) ​ Decrease in other assets ​ 417 ​ ​ 488 ​ Decrease in accounts payable - loan closing ​ ​ ( 2,520 ) ​ ​ ( 69 ) ​ Increase in accounts payable and accrued expenses ​ 218 ​ ​ 149 ​ Net Cash Provided by Operating Activities ​ 14,447 ​ 12,650 ​ Cash Flows from Investing Activities: ​ ​ ​ Net increase in loans ​ ( 149,344 ) ​ ( 91,604 ) ​ Proceeds from sale of loans ​ 4,553 ​ 3,148 ​ Principal repayments on securities held-to-maturity ​ 1,168 ​ 4,274 ​ Purchase of marketable equity securities ​ — ​ ( 5,000 ) ​ Purchase of securities held-to-maturity ​ ( 10,038 ) ​ ( 10,312 ) ​ Net redemptions of restricted stock ​ 331 ​ 26 ​ Purchases of premises and equipment ​ ( 3,236 ) ​ ( 5,699 ) ​ Net Cash Used in Investing Activities ​ ( 156,566 ) ​ ( 105,167 ) ​ Cash Flows from Financing Activities: ​ ​ ​ Net increase in deposits ​ 60,460 ​ 45,129 ​ Repayment of FHLB of NY advances ​ ( 7,000 ) ​ — ​ Loan to ESOP ​ ​ — ​ ​ ( 7,828 ) ​ Issuance of common stock funded by stock subscriptions ​ ​ — ​ ​ 95,390 ​ Stock repurchases ​ ​ ( 3,195 ) ​ ​ — ​ Increase (decrease) in advance payments by borrowers for taxes and insurance ​ 413 ​ ( 74 ) ​ Cash dividends paid ​ ( 5,896 ) ​ ( 1,278 ) ​ Net Cash Provided by Financing Activities ​ 44,782 ​ 131,339 ​ Net (Decrease) Increase in Cash and Cash Equivalents ​ ( 97,337 ) ​ 38,822 ​ Cash and Cash Equivalents – Beginning ​ 152,269 ​ 69,191 ​ Cash and Cash Equivalents – Ending ​ $ 54,932 ​ $ 108,013 ​ See notes to interim unaudited consolidated financial statements. ​ 8 Table of Contents NORTHEAST COMMUNITY BANCORP, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (continued) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Nine Months Ended September 30, ​ ​ 2022 2021 ​ ​ ​ (In thousands) ​ Supplementary Cash Flows Information: ​ ​ ​ Income taxes paid ​ $ 5,485 ​ $ 3,296 ​ Interest paid ​ $ 4,491 ​ $ 3,869 ​ Supplementary Disclosure of Non-Cash Investing and Financing Activities: ​ ​ ​ Dividends declared and not paid ​ $ 968 ​ $ — ​ ​ See notes to interim unaudited consolidated financial statements. ​ ​ 9 Table of Contents ​ NORTHEAST COMMUNITY BANCORP, INC. Notes to Condensed Consolidated Financial Statements (Dollars in thousands, unless otherwise stated) (Unaudited) NORTHEAST COMMUNITY BANCORP, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1 — Summary of Significant Accounting Policies The following is a description of the Company’s business and significant accounting and reporting policies: Nature of Business: Northeast Community Bancorp, Inc. (the “Company”) is a Maryland corporation that was incorporated in May 2021 to be the successor to NorthEast Community Bancorp, Inc., a federally chartered corporation (the “Mid-Tier Holding Company”), upon completion of the second-step conversion of NorthEast Community Bank (the “Bank”) from the two-tier mutual holding company structure to the stock holding company structure. NorthEast Community Bancorp, MHC was the former mutual holding company for the Mid-Tier Holding Company prior to the completion of the second-step conversion. In conjunction with the second-step conversion, each of NorthEast Community Bancorp, MHC and the Mid-Tier Holding Company merged out of existence and now cease to exist. The second-step conversion was completed on July 12, 2021, at which time the Company sold, for gross proceeds of $ 97.8 million, a total of 9,784,077 shares of common stock at $ 10.00 per share. As part of the second-step conversion, each of the existing outstanding shares of Mid-Tier Holding Company common stock owned by persons other than NorthEast Community Bancorp, MHC was converted into 1.3400 shares of Company common stock. As a result of the second-step conversion, all share information has been subsequently revised to reflect the 1.3400 exchange ratio, unless otherwise noted. ​ The Bank is a New York State-chartered savings bank and completed its conversion from a federally-chartered savings bank effective as of the close of business on June 29, 2012. The Company’s primary activity is the ownership and operation of the Bank. ​ The Bank is headquartered in White Plains, New York. The Bank was founded in 1934 and is a community oriented financial institution dedicated to serving the financial services needs of individuals and businesses within its market area. The Bank currently conducts business through its eleven branch offices located in Bronx, New York, Orange, Rockland, Sullivan, and Westchester Counties in New York and Essex, Middlesex and Norfolk Counties in Massachusetts and two loan production offices located in White Plains, New York, and New City, New York. The Bank’s principal business consists of originating primarily construction loans and, to a lesser extent, commercial and industrial loans and multifamily and mixed-use residential real estate loans and non-residential real estate loans. The Bank offers a variety of retail deposit products to the general public in the areas surrounding its main office and its branch offices, with interest rates that are competitive with those of similar products offered by other financial institutions operating in its market area. The Bank also utilizes borrowings as a source of funds. The Bank’s revenues are derived primarily from interest on loans and, to a lesser extent, interest on investment securities and mortgage-backed securities. The Bank also generates revenues from other income including deposit fees, service charges and investment advisory fees. The Bank also offers investment advisory and financial planning services under the name Harbor West Wealth Management Group, a division of the Bank, through a networking arrangement with a registered broker-dealer and investment advisor. New England Commercial Properties LLC (“NECP”), a New York limited liability company and wholly owned subsidiary of the Bank, was formed in October 2007 to facilitate the purchase or lease of real property by the Bank. New England Commercial Properties, LLC currently owns one foreclosed property located in Pennsylvania. 10 Table of Contents NECB Financial Services Group, LLC (“NECB Financial”), a New York limited liability company and wholly owned subsidiary of the Bank, was formed in the third quarter of 2012 as a complement to Harbor West Wealth Management Group to sell life insurance and fixed rate annuities. NECB Financial is licensed in the States of New York and Connecticut. 72 West Eckerson LLC (“72 West Eckerson”), a New York limited liability company and wholly owned subsidiary of the Bank, was formed in April 2015 to facilitate the purchase or lease of real property by the Bank and currently owns the Bank branch locations in Spring Valley, New York and Monroe, New York. 166 Route 59 Realty LLC (“166 Route 59 Realty”), a New York limited liability company and wholly owned subsidiary of the Bank, was formed in April 2021 to facilitate the purchase or lease of real property by the Bank and currently owns the property for the Bank branch located in Airmont, New York. 3 Winterton Realty LLC, a New York limited liability company and wholly owned subsidiary of the Bank, was formed in October 2021 to facilitate the purchase or lease of real property by the Bank and currently owns the property for the Bank branch located in Bloomingburg, New York. Principal of Consolidations: The accompanying unaudited consolidated financial statements include the accounts of the Company, the Bank, NECP, NECB Financial, 72 West Eckerson, 166 Route 59 Realty, and 3 Winterton Realty LLC (collectively the “Company”) and have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). All significant inter-company accounts and transactions have been eliminated in consolidation. The accounting and reporting policies of the Company and its subsidiaries conform to accounting principles generally accepted in the United States of America (“U.S. GAAP”) and to the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements have been condensed or omitted pursuant to such rules and regulations. The unaudited consolidated interim financial information should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2021. In the opinion of the Company, all adjustments (consisting only of normal recurring accruals) that are necessary for a fair presentation of the operating results for the interim periods have been included. The results of operations for periods of less than a year are not necessarily indicative of results for the full year or any other period. Use of Estimates: The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements, and reported amounts of revenue and expenses during the reporting period. Estimates that are particularly susceptible to change in the near term, including novel coronavirus (“COVID-19”) related changes, are used in connection with the determination of the allowance for loan losses, the review of the need for a valuation allowance of the Company’s deferred tax assets and the fair value of financial instruments. COVID-19: The Company continues to monitor the impact of COVID-19 and considers these disruptions to be temporary. If the disruptions continue, this might have an adverse effect on the Company’s results of operations, financial position, and liquidity in 2022. Further, a decrease in the results of future operations could strain the Company’s regulatory capital ratios. ​ Note 2 — Regulatory Capital The Company and the Bank are subject to regulatory capital requirements promulgated by the federal banking agencies. The Federal Reserve establishes capital requirements, including well capitalized standards, for the consolidated bank holding company, and the FDIC has similar requirements for the Company’s subsidiary bank. Prior to January 1, 11 Table of Contents 2015, quantitative measures were established by regulation to ensure capital adequacy which required the Bank to maintain minimum amounts and ratios of Total, Tier 1 capital (as defined by regulations) to risk-weighted assets (as defined), and of Core tier 1 capital to adjusted total assets (as defined). Effective January 1, 2015, the Company adopted the Basel III final rule. Based on the Company’s capital levels and statement of condition composition at December 31, 2021, the implementation of the new rule had no material impact on our regulatory capital level or ratios at the Bank level. The rule established limits at the Company level and increased the minimum Tier 1 capital to risk based assets requirement from 4 % to 6 % of risk-weighted assets; established a new common equity Tier 1 capital; and assigned a higher risk weight ( 150 %) to exposures that are more than 90 days past due or are on nonaccrual and to certain commercial real estate facilities that finance the acquisition, development or construction of real property. The rule has a capital conservation buffer requirement that was phased in at a rate of 0.625 % annually beginning January 1, 2016 through January 1, 2020, when full capital conservation buffer requirement of 2.50 % became effective. The Federal Reserve Board has provided a “small bank holding company” exception to its consolidated capital requirements, and legislation and the related issuance of regulations by the Federal Reserve Board has increased the threshold for the exception to $3.0 billion. As a result, the Company is not subject to the capital requirements until such time as its consolidated assets exceed $3.0 billion. The Bank met all capital adequacy requirements to which it was subject as of September 30, 2022 and December 31, 2021. The following table presents information about the Bank’s capital levels at the dates presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Regulatory Capital Requirements ​ ​ ​ ​ ​ ​ ​ Minimum Capital ​ For Classification as ​ ​ Actual ​ Adequacy(1) ​ Well-Capitalized ​ Amount Ratio Amount Ratio Amount Ratio ​ ​ (Dollars in Thousands) As of September 30, 2022: ​ ​ ​ ​ ​ ​ ​ ​ Total capital (to risk-weighted assets) ​ $ 212,881 13.86 % $ ≥ 122,851 ≥ 8.00 % $ ≥ 153,563 ≥ 10.00 % Tier 1 capital (to risk-weighted assets) ​ 207,448 13.51 ​ ≥ 92,138 ≥ 6.00 ​ ≥ 122,851 ≥ 8.00 ​ Common equity tier 1 capital (to risk-weighted assets) ​ 207,448 13.51 ​ ≥ 69,104 ≥ 4.50 ​ ≥ 99,816 ≥ 6.50 ​ Core (Tier 1) capital (to adjusted total assets) ​ 207,448 16.91 ​ ≥ 49,060 ≥ 4.00 ​ ≥ 61,325 ≥ 5.00 ​ As of December 31, 2021: ​ ​ ​ ​ ​ ​ ​ ​ Total capital (to risk-weighted assets) ​ $ 196,155 15.28 % $ ≥ 102,702 ≥ 8.00 % $ ≥ 128,377 ≥ 10.00 % Tier 1 capital (to risk-weighted assets) ​ 190,941 14.87 ​ ≥ 77,026 ≥ 6.00 ​ ≥ 102,702 ≥ 8.00 ​ Common equity tier 1 capital (to risk-weighted assets) ​ 190,941 14.87 ​ ≥ 57,770 ≥ 4.50 ​ ≥ 83,445 ≥ 6.50 ​ Core (Tier 1) capital (to adjusted total assets) ​ 190,941 16.79 ​ ≥ 45,486 ≥ 4.00 ​ ≥ 56,857 ≥ 5.00 ​ (1) Ratios do not include the capital conservation buffer. Based on the most recent notification by the FDIC, the Bank was categorized as “well capitalized” under the regulatory framework for prompt corrective action. There have been no conditions or events that have occurred since notification that management believes have changed the Bank’s category. ​ Note 3 — Equity Securities The following table is the schedule of equity securities at September 30, 2022 and December 31, 2021. The equity securities consists of our investment in a market-rate bond mutual fund that invests in high quality fixed income bonds, mainly government agency securities whose proceeds are designed to positively impact community development 12 Table of Contents throughout the United States. The mutual fund focuses exclusively on providing affordable housing for low- and moderate-income borrowers and renters, including those in majority minority census tracts. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, ​ December 31, ​ ​ 2022 2021 ​ ​ ​ (In Thousands) ​ Equity Securities, at Fair Value ​ $ 18,307 ​ $ 19,943 ​ ​ The following is a summary of unrealized gain or loss recognized in net income on equity securities during the three and nine months ended September 30, 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ Nine Months Ended September 30, ​ ​ 2022 2021 ​ 2022 2021 ​ ​ ​ (In Thousands) ​ (In Thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net loss recognized on equity securities during the period ​ $ 573 ​ $ 154 ​ $ 1,636 ​ $ 215 ​ Less: Net losses realized on the sale of equity securities during the period ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ Unrealized net loss recognized on equity securities held at the reporting date ​ $ 573 ​ $ 154 ​ $ 1,636 ​ $ 215 ​ ​ ​ ​ Note 4 — Securities Available-for-Sale The following table summarizes the Company’s portfolio of securities available-for-sale at September 30, 2022 and December 31, 2021. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, 2022 ​ ​ ​ ​ ​ Gross ​ Gross ​ ​ ​ ​ ​ Amortized ​ Unrealized ​ Unrealized ​ Fair ​ Cost Gains Losses Value ​ ​ (In Thousands) Mortgage-backed securities – residential: ​ ​ ​ ​ Federal Home Loan Mortgage Corporation ​ $ 1 ​ $ — ​ $ — ​ $ 1 ​ ​ $ 1 ​ $ — ​ $ — ​ $ 1 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2021 ​ ​ ​ ​ ​ Gross ​ Gross ​ ​ ​ ​ ​ Amortized ​ Unrealized ​ Unrealized ​ Fair ​ Cost Gains Losses Value ​ (In Thousands) Mortgage-backed securities – residential: ​ ​ ​ ​ Federal Home Loan Mortgage Corporation ​ $ 1 ​ $ — ​ $ — ​ $ 1 ​ ​ $ 1 ​ $ — ​ $ — ​ $ 1 ​ There were no sales of securities available-for-sale as of September 30, 2022 and December 31, 2021. Contractual final maturities of mortgage-backed securities were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, 2022 ​ Amortized Cost Fair Value ​ ​ (In Thousands) Due after one year but within five years ​ $ 1 ​ $ 1 ​ ​ $ 1 ​ $ 1 ​ The maturities shown above are based upon contractual final maturity. Actual maturities will differ from contractual maturities due to scheduled monthly repayments and due to the underlying borrowers having the right to prepay their obligations. At September 30, 2022 and December 31, 2021, the Company had no unrealized loss. 13 Table of Contents Note 5 — Securities Held-to-Maturity The following table summarizes the Company’s portfolio of securities held-to-maturity at September 30, 2022 and December 31, 2021. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, 2022 ​ ​ ​ ​ ​ Gross ​ Gross ​ ​ ​ ​ ​ Amortized ​ Unrealized ​ Unrealized ​ Fair ​ Cost Gains Losses Value ​ ​ (In Thousands) Mortgage-backed securities – residential: ​ ​ ​ ​ ​ Government National Mortgage Association ​ $ 544 ​ $ ​ ​ $ 13 ​ $ 531 Federal Home Loan Mortgage Corporation ​ 985 ​ — ​ 140 ​ 845 Federal National Mortgage Association ​ 2,389 ​ — ​ 275 ​ 2,114 Collateralized mortgage obligations – GSE ​ 3,083 ​ — ​ 480 ​ 2,603 Total mortgage-backed securities ​ ​ 7,001 ​ ​ — ​ ​ 908 ​ ​ 6,093 Municipal Bonds ​ ​ 9,709 ​ ​ — ​ ​ 2,787 ​ ​ 6,922 U.S. Treasury securities ​ ​ 10,022 ​ ​ — ​ ​ 137 ​ ​ 9,885 ​ ​ $ 26,732 ​ $ — ​ $ 3,832 ​ $ 22,900 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2021 ​ ​ ​ ​ ​ Gross ​ Gross ​ ​ ​ ​ ​ Amortized ​ Unrealized ​ Unrealized ​ Fair ​ Cost Gains Losses Value ​ ​ (In Thousands) Mortgage-backed securities – residential: ​ ​ ​ ​ Government National Mortgage Association ​ $ 656 ​ $ 19 ​ $ — ​ $ 675 Federal Home Loan Mortgage Corporation ​ 1,059 ​ — ​ 5 ​ 1,054 Federal National Mortgage Association ​ 2,695 ​ 23 ​ 6 ​ 2,712 Collateralized mortgage obligations – GSE ​ 3,453 ​ 18 ​ 49 ​ 3,422 Total mortgage-backed securities ​ ​ 7,863 ​ ​ 60 ​ ​ 60 ​ ​ 7,863 Municipal Bonds ​ ​ 10,017 ​ ​ 7 ​ ​ 267 ​ ​ 9,757 ​ ​ $ 17,880 ​ $ 67 ​ $ 327 ​ $ 17,620 ​ Contractual final maturities of mortgage-backed securities, municipal bonds, U.S. Treasury securities were as follows at September 30, 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, 2022 ​ ​ Amortized ​ Fair ​ Cost Value ​ (In Thousands) Due within one year ​ $ 10,389 ​ $ 10,292 Due after one but within five years ​ 1,774 ​ 1,983 Due after five but within ten years ​ 2,585 ​ 2,346 Due after ten years ​ 11,984 ​ 8,279 ​ ​ $ 26,732 ​ $ 22,900 ​ The maturities shown above are based upon contractual final maturity. Actual maturities will differ from contractual maturities due to scheduled monthly repayments and due to the underlying borrowers having the right to prepay their obligations. 14 Table of Contents The age of unrealized losses and the fair value of related securities held-to-maturity were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less than 12 Months ​ 12 Months or More ​ Total ​ ​ ​ ​ ​ Gross ​ ​ ​ ​ Gross ​ ​ ​ ​ Gross ​ ​ Fair ​ Unrealized ​ Fair ​ Unrealized ​ Fair ​ Unrealized ​ Value Losses Value Losses Value Losses ​ ​ (In Thousands) September 30, 2022: ​ ​ ​ ​ ​ ​ Mortgage-backed securities - residential: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Government National Mortgage Association ​ $ 531 ​ $ 13 ​ $ — ​ $ — ​ $ 531 ​ $ 13 Federal Home Loan Mortgage Corporation ​ ​ 809 ​ ​ 139 ​ ​ 36 ​ ​ 1 ​ ​ 845 ​ ​ 140 Federal National Mortgage Association ​ ​ 2,114 ​ ​ 275 ​ ​ — ​ ​ — ​ ​ 2,114 ​ ​ 275 Collateralized mortgage obligations – GSE ​ ​ 2,603 ​ ​ 480 ​ ​ — ​ ​ — ​ ​ 2,603 ​ ​ 480 Total mortgage-backed securities ​ ​ 6,057 ​ ​ 907 ​ ​ 36 ​ ​ 1 ​ ​ 6,093 ​ ​ 908 Municipal Bonds ​ ​ 6,922 ​ ​ 2,787 ​ ​ — ​ ​ — ​ ​ 6,922 ​ ​ 2,787 U.S. Treasury securities ​ ​ 9,885 ​ ​ 137 ​ ​ — ​ ​ — ​ ​ 9,885 ​ ​ 137 ​ ​ $ 22,864 ​ $ 3,831 ​ $ 36 ​ $ 1 ​ $ 22,900 ​ $ 3,832 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less than 12 Months ​ 12 Months or More ​ Total ​ ​ ​ ​ ​ Gross ​ ​ ​ ​ Gross ​ ​ ​ ​ Gross ​ ​ Fair ​ Unrealized ​ Fair ​ Unrealized ​ Fair ​ Unrealized ​ Value Losses Value Losses Value Losses ​ ​ (In Thousands) December 31, 2021: ​ ​ ​ ​ ​ ​ Municipal Bonds ​ $ 9,134 ​ $ 267 ​ $ — ​ $ — ​ $ 9,134 ​ $ 267 Mortgage-backed securities - residential: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Federal Home Loan Mortgage Corporation ​ $ 1,004 ​ $ 5 ​ $ — ​ $ — ​ $ 1,004 ​ $ 5 Federal National Mortgage Association ​ ​ 2,035 ​ ​ 6 ​ ​ — ​ ​ — ​ ​ 2,035 ​ ​ 6 Collateralized mortgage obligations – GSE ​ ​ 907 ​ ​ 49 ​ ​ — ​ ​ — ​ ​ 907 ​ ​ 49 Total mortgage-backed securities ​ ​ 3,946 ​ ​ 60 ​ ​ — ​ ​ — ​ ​ 3,946 ​ ​ 60 ​ ​ $ 13,080 ​ $ 327 ​ $ — ​ $ — ​ $ 13,080 ​ $ 327 ​ At September 30, 2022, thirty five mortgage-backed securities, five municipal bonds and two U.S. Treasury notes had unrealized loss due to interest rate volatility. Management concluded that the unrealized loss reflected above was temporary in nature since the unrealized loss was related primarily to market interest rates volatility, and not related to the underlying credit quality of the issuers of the securities. Additionally, the Company has the ability and intent to hold the securities for the time necessary to recover the amortized cost. At December 31, 2021, there were four mortgage-backed securities and three municipal bonds with unrealized loss. ​ Note 6 — Loans Receivable and the Allowance for Loan Losses Loans are stated at unpaid principal balances plus net deferred loan origination fees and costs less an allowance for loan losses. Interest on loans receivable is recorded on the accrual basis. An allowance for uncollected interest is established on loans where management has determined that the borrowers may be unable to meet contractual principal and/or interest obligations or where interest or principal is 90 days or more past due, unless the loans are well secured with a reasonable expectation of collection. When a loan is placed on nonaccrual, an allowance for uncollected interest is established and charged against current income. Thereafter, interest income is not recognized unless the financial condition and payment record of the borrower warrant the recognition of interest income. Generally, loans are restored to accrual status when the obligation is brought current, 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. Interest on loans that have been restructured is accrued according to the renegotiated terms. Net loan origination fees and costs are deferred and amortized into interest income over the contractual lives of the related loans by use of the level yield method. Past due status of loans is based upon the contractual due date. Prepayment penalties received on loans which pay in full prior to the scheduled maturity are included in interest income in the period the prepayment penalties are collected. 15 Table of Contents The composition of loans were as follows at September 30, 2022 and December 31, 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, ​ December 31, ​ ​ 2022 2021 ​ ​ ​ (In Thousands) ​ Residential real estate: ​ ​ ​ One-to-four family ​ $ 5,706 ​ $ 7,189 ​ Multi-family ​ 88,418 ​ 84,425 ​ Mixed-use ​ 22,817 ​ 28,744 ​ Total residential real estate ​ 116,941 ​ 120,358 ​ Non-residential real estate ​ 25,587 ​ 50,016 ​ Construction ​ 862,450 ​ 683,830 ​ Commercial and industrial ​ 111,416 ​ 118,378 ​ Consumer ​ 1,023 ​ 269 ​ Total Loans ​ 1,117,417 ​ 972,851 ​ Deferred loan costs, net ​ 551 ​ 484 ​ Allowance for loan losses ​ ( 5,461 ) ​ ( 5,242 ) ​ ​ ​ $ 1,112,507 ​ $ 968,093 ​ ​ Loans serviced for the benefit of others totaled approximately $ 16,585,000 and $ 14,610,000 at September 30, 2022 and December 31, 2021, respectively. The value of mortgage servicing rights was not material at September 30, 2022 and December 31, 2021. The Company did not originate Payroll Protection Program (“PPP”) loans associated with the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 (the “CARES Act”) in 2022 or 2021. The Company had no loans to related parties at September 30, 2022 and December 31, 2021. In addition, the Company did not originate any loans to related parties in 2022 or 2021. The allowance for loan losses represents management’s estimate of losses inherent in the loan portfolio as of the statement of financial condition date and is recorded as a reduction to loans. The allowance for loan losses is increased by the provision for loan losses, and decreased by charge-offs, net of recoveries. Loans deemed to be uncollectible are charged against the allowance for loan losses, and subsequent recoveries, if any, are credited to the allowance. All, or part, of the principal balance of loans receivable are charged off to the allowance as soon as it is determined that the repayment of all, or part, of the principal balance is highly unlikely. The allowance for loan losses is maintained at a level considered adequate to provide for losses that can be reasonably anticipated. Management performs a quarterly evaluation of the adequacy of the allowance. The allowance is based on the Company’s past loan loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value of any underlying collateral, composition of the loan portfolio, current economic conditions, and other relevant factors. This evaluation is inherently subjective as it requires material estimates that may be susceptible to significant revision as more information becomes available. 16 Table of Contents The following tables summarize the allocation of the allowance for loan losses and loans receivable by loan class and impairment method at September 30, 2022 and December 31, 2021: At September 30, 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non- ​ ​ ​ ​ Commercial ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential ​ residential ​ ​ ​ ​ and ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Real Estate Real Estate Construction Industrial Consumer Unallocated Total ​ ​ (In Thousands) Allowance for loan losses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ending balance ​ $ 395 ​ $ 143 ​ $ 3,893 ​ $ 931 ​ $ 35 ​ $ 64 ​ $ 5,461 Ending balance: individually evaluated for impairment ​ $ — ​ $ — ​ $ — ​ $ — ​ $ — ​ $ — ​ $ — Ending balance: collectively evaluated for impairment ​ $ 395 ​ $ 143 ​ $ 3,893 ​ $ 931 ​ $ 35 ​ $ 64 ​ $ 5,461 Loans receivable: ​ ​ ​ ​ ​ ​ ​ Ending balance ​ $ 116,941 ​ $ 25,587 ​ $ 862,450 ​ $ 111,416 ​ $ 1,023 ​ $ — ​ $ 1,117,417 Ending balance: individually evaluated for impairment ​ $ 861 ​ $ — ​ $ — ​ $ — ​ $ — ​ $ — ​ $ 861 Ending balance: collectively evaluated for impairment ​ $ 116,080 ​ $ 25,587 ​ $ 862,450 ​ $ 111,416 ​ $ 1,023 ​ $ — ​ $ 1,116,556 ​ ​ At December 31, 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non- ​ ​ ​ ​ Commercial ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential ​ residential ​ ​ ​ ​ and ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Real Estate ​ Real Estate ​ Construction ​ Industrial ​ Consumer ​ Unallocated ​ Total ​ ​ (In Thousands) Allowance for loan losses: ​ ​ ​ ​ ​ ​ ​ Ending balance ​ $ 571 ​ $ 381 ​ $ 3,143 ​ $ 973 ​ $ 10 ​ $ 164 ​ $ 5,242 Ending balance: individually evaluated for impairment ​ $ — ​ $ — ​ $ — ​ $ — ​ $ — ​ $ — ​ $ — Ending balance: collectively evaluated for impairment ​ $ 571 ​ $ 381 ​ $ 3,143 ​ $ 973 ​ $ 10 ​ $ 164 ​ $ 5,242 Loans receivable: ​ ​ ​ ​ ​ ​ ​ Ending balance ​ $ 120,358 ​ $ 50,016 ​ $ 683,830 ​ $ 118,378 ​ $ 269 ​ $ — ​ $ 972,851 Ending balance: individually evaluated for impairment ​ $ 876 ​ $ 746 ​ $ — ​ $ — ​ $ — ​ $ — ​ $ 1,622 Ending balance: collectively evaluated for impairment ​ $ 119,482 ​ $ 49,270 ​ $ 683,830 ​ $ 118,378 ​ $ 269 ​ $ — ​ $ 971,229 ​ ​ 17 Table of Contents The activity in the allowance for loan loss by loan class for the three months ended September 30, 2022 and 2021 was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non- ​ ​ ​ ​ Commercial ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential ​ residential ​ ​ ​ ​ and ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Real Estate Real Estate Construction Industrial Consumer Unallocated Total ​ ​ (In Thousands) Allowance for loan losses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance - June 30, 2022 ​ $ 546 ​ $ 198 ​ $ 3,581 ​ $ 865 ​ $ 16 ​ $ 261 ​ $ 5,467 Charge-offs ​ — ​ — ​ — ​ — ​ ( 6 ) ​ — ​ ( 6 ) Recoveries ​ — ​ — ​ — ​ — ​ — ​ — ​ — Provision (Benefit) ​ ( 151 ) ​ ( 55 ) ​ 312 ​ 66 ​ 25 ​ ( 197 ) ​ — Balance -September 30, 2022 ​ $ 395 ​ $ 143 ​ $ 3,893 ​ $ 931 ​ $ 35 ​ $ 64 ​ $ 5,461 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non- ​ ​ ​ ​ Commercial ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential ​ residential ​ ​ ​ ​ and ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Real Estate Real Estate Construction Industrial Consumer Unallocated Total ​ ​ (In Thousands) Allowance for loan losses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance - June 30, 2021 ​ $ 687 ​ $ 476 ​ $ 3,196 ​ $ 682 ​ $ 15 ​ $ 38 ​ $ 5,094 Charge-offs ​ — ​ ( 3,593 ) ​ — ​ — ​ ( 3 ) ​ — ​ ( 3,596 ) Recoveries ​ 151 ​ — ​ — ​ — ​ — ​ — ​ 151 Provision (Benefit) ​ ( 321 ) ​ 3,512 ​ 51 ​ 195 ​ ( 11 ) ​ 167 ​ 3,593 Balance - September 30, 2021 ​ $ 517 ​ $ 395 ​ $ 3,247 ​ $ 877 ​ $ 1 ​ $ 205 ​ $ 5,242 ​ The activity in the allowance for loan loss by loan class for the nine months ended September 30, 2022 and 2021 was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non- ​ ​ ​ ​ Commercial ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential ​ residential ​ ​ ​ ​ and ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Real Estate ​ Real Estate ​ Construction ​ Industrial ​ Consumer ​ Unallocated ​ Total ​ ​ (In Thousands) Allowance for loan losses: ​ ​ ​ ​ ​ ​ ​ Balance - December 31, 2021 ​ $ 571 ​ $ 381 ​ $ 3,143 ​ $ 973 ​ $ 10 ​ $ 164 ​ $ 5,242 Charge-offs ​ — ​ — ​ — ​ — ​ ( 23 ) ​ — ​ ( 23 ) Recoveries ​ 189 ​ 53 ​ — ​ — ​ — ​ — ​ 242 Provision (Benefit) ​ ( 365 ) ​ ( 291 ) ​ 750 ​ ( 42 ) ​ 48 ​ ( 100 ) ​ — Balance - September 30, 2022 ​ $ 395 ​ $ 143 ​ $ 3,893 ​ $ 931 ​ $ 35 ​ $ 64 ​ $ 5,461 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non- ​ ​ ​ ​ Commercial ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential ​ residential ​ ​ ​ ​ and ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Real Estate ​ Real Estate ​ Construction ​ Industrial ​ Consumer ​ Unallocated ​ Total ​ ​ (In Thousands) Allowance for loan losses: ​ ​ ​ ​ ​ ​ ​ Balance - December 31, 2020 ​ $ 707 ​ $ 519 ​ $ 3,068 ​ $ 774 ​ $ 20 ​ $ — ​ $ 5,088 Charge-offs ​ — ​ ( 3,593 ) ​ — ​ — ​ ( 23 ) ​ — ​ ( 3,616 ) Recoveries ​ 152 ​ — ​ — ​ — ​ 8 ​ — ​ 160 Provision (Benefit) ​ ( 342 ) ​ 3,469 ​ 179 ​ 103 ​ ( 4 ) ​ 205 ​ 3,610 Balance - September 30, 2021 ​ $ 517 ​ $ 395 ​ $ 3,247 ​ $ 877 ​ $ 1 ​ $ 205 ​ $ 5,242 ​ During the three months ended September 30, 2022, the provision expenses recorded for construction loans and commercial and industrial loans were primarily attributed to the increased loan balances. The credit provision recorded for residential loans was due to reduced credit risk assessed during the three-month period. The credit provision recorded for non-residential loans was due to decreased loan balances. During the three months ended September 30, 2021, the provision expenses recorded for non-residential loans were primarily attributed to the previously disclosed charge-off of $ 3.6 million during the three months ended September 30, 2021 regarding a nonresidential bridge loan secured by real estate with a balance of $ 3.6 million. The provision expenses recorded for commercial and industrial loan and construction loan segments were primarily due to increased loan balances, and the credit provision recorded for residential real estate loan segment was due to decreased loan balance. During the nine months ended September 30, 2022, the provision expenses recorded for construction loans were attributed to the increased loan balances. The credit provision recorded for residential loans was primarily due to loan recoveries and reduced credit risk during the nine-month period. The credit provision recorded for non-residential loans 18 Table of Contents was attributed to loan recoveries and decreased loan balances. The credit provision recorded for commercial and industrial loans was primarily due to decreased loan balances during the nine-month period. During the nine months ended September 30, 2021, the provision expenses recorded were primarily attributed to the previously disclosed charge-off of $ 3.6 million during the nine months ended September 30, 2021 regarding a nonresidential bridge loan secured by real estate with a balance of $ 3.6 million, as well as increased loan balances in construction loan and commercial and industrial loan segments. The credit provision recorded for residential real estate was due to decreased loan balances. The following table shows our recorded investment, unpaid principal balance and allocated allowance for loan losses for loans that were considered impaired as of and for the periods presented: As of and for the Three and Nine months Ended September 30, 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, 2022 ​ Nine Months Ended September 30, 2022 ​ Recorded Unpaid Principal Related Average Recorded Interest Income Average Recorded Interest Income 2022 ​ Investment ​ Balance ​ Allowance ​ Investment ​ Recognized Investment ​ Recognized ​ ​ (In Thousands) With no related allowance recorded: ​ ​ ​ ​ ​ ​ ​ ​ Residential real estate-Multi-family ​ $ 861 ​ $ 861 ​ $ — ​ $ 863 ​ $ 11 ​ $ 867 ​ $ 33 Non-residential real estate ​ — ​ — ​ — ​ 385 ​ — ​ 570 ​ 14 Construction ​ — ​ — ​ — ​ — ​ — ​ — ​ — Commercial and industrial ​ — ​ — ​ — ​ — ​ — ​ — ​ — ​ ​ 861 ​ 861 ​ — ​ 1,248 ​ 11 ​ 1,437 ​ 47 With an allowance recorded ​ — ​ — ​ — ​ — ​ — ​ — ​ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total: ​ ​ ​ ​ ​ ​ ​ Residential real estate-Multi-family ​ 861 ​ 861 ​ — ​ 863 ​ 11 ​ 867 ​ 33 Non-residential real estate ​ — ​ — ​ — ​ 385 ​ — ​ 570 ​ 14 Construction ​ — ​ — ​ — ​ — ​ — ​ — ​ — Commercial and industrial ​ — ​ — ​ — ​ — ​ — ​ — ​ — ​ ​ $ 861 ​ $ 861 ​ $ — ​ $ 1,248 ​ $ 11 ​ $ 1,437 ​ $ 47 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, 2021 ​ Nine Months Ended September 30, 2021 ​ Recorded Unpaid Principal Related Average Recorded Interest Income Average Recorded Interest Income 2021 ​ Investment ​ Balance ​ Allowance ​ Investment ​ Recognized Investment ​ Recognized ​ ​ (In Thousands) With no related allowance recorded: ​ ​ ​ ​ ​ ​ ​ ​ Residential real estate-Multi-family ​ $ 1,964 ​ $ 1,964 ​ $ — ​ $ 1,971 ​ $ 24 ​ $ 1,986 ​ $ 69 Non-residential real estate ​ 740 ​ 807 ​ — ​ 2,571 ​ 9 ​ 3,486 ​ 26 Construction ​ — ​ — ​ — ​ — ​ — ​ — ​ — Commercial and industrial ​ — ​ — ​ — ​ — ​ — ​ — ​ — ​ ​ 2,704 ​ 2,771 ​ — ​ 4,542 ​ 33 ​ 5,472 ​ 95 With an allowance recorded ​ — ​ — ​ — ​ — ​ — ​ — ​ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total: ​ ​ ​ ​ ​ ​ ​ Residential real estate-Multi-family ​ 1,964 ​ 1,964 ​ — ​ 1,971 ​ 24 ​ 1,986 ​ 69 Non-residential real estate ​ 740 ​ 807 ​ — ​ 2,571 ​ 9 ​ 3,486 ​ 26 Construction ​ — ​ — ​ — ​ — ​ — ​ — ​ — Commercial and industrial ​ — ​ — ​ — ​ — ​ — ​ — ​ — ​ ​ $ 2,704 ​ $ 2,771 ​ $ — ​ $ 4,542 ​ $ 33 ​ $ 5,472 ​ $ 95 ​ 19 Table of Contents As of and for the Year Ended December 31, 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Recorded Unpaid Principal Related Average Recorded Interest Income 2021 ​ Investment ​ Balance ​ Allowance ​ Investment ​ Recognized ​ ​ (In Thousands) With no related allowance recorded: ​ ​ ​ ​ ​ Residential real estate-Multi-family ​ $ 876 ​ $ 876 ​ $ — ​ $ 1,986 ​ $ 86 Non-residential real estate ​ 746 ​ 813 ​ — ​ 3,891 ​ ​ 36 Construction ​ — ​ — ​ — ​ — ​ — Commercial and industrial ​ — ​ — ​ — ​ — ​ — ​ ​ 1,622 ​ 1,689 ​ — ​ 5,877 ​ 122 With an allowance recorded ​ — ​ — ​ — ​ — ​ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total: ​ ​ ​ ​ ​ Residential real estate-Multi-family ​ 876 ​ 876 ​ — ​ 1,986 ​ 86 Non-residential real estate ​ 746 ​ 813 ​ — ​ 3,891 ​ 36 Construction ​ — ​ — ​ — ​ — ​ — Commercial and industrial ​ — ​ — ​ — ​ — ​ — ​ ​ $ 1,622 ​ $ 1,689 ​ $ — ​ $ 5,877 ​ $ 122 ​ There were no non-accrual loans at September 30, 2022. The Company did no t recognize any interest income on non-accrual loans during the nine months ended September 30, 2022 and 2021. During the three months ended September 30, 2022, the Company collected $ 23,000 interest income from a non-accrual loan that was satisfied in July 2022. The Company is not committed to lend additional funds to borrowers whose loans have been placed on non-accrual status. There were no non-accrual loans at December 31, 2021. The following tables provide information about delinquencies in our loan portfolio at the dates indicated. Age Analysis of Past Due Loans as of September 30, 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Recorded ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Investment > ​ ​ 30 – 59 Days ​ 60 – 89 Days ​ Greater Than ​ Total Past ​ ​ ​ ​ Total Loans ​ 90 Days and ​ Past Due Past Due 90 Days Due Current Receivable Accruing ​ ​ (In Thousands) Residential real estate: ​ ​ ​ ​ ​ ​ ​ One- to four-family ​ $ — ​ $ — ​ $ — ​ $ — ​ $ 5,706 ​ $ 5,706 ​ $ — Multi-family ​ — ​ — ​ — ​ — ​ 88,418 ​ 88,418 ​ — Mixed-use ​ — ​ — ​ — ​ — ​ 22,817 ​ 22,817 ​ — Non-residential real estate ​ — ​ — ​ — ​ — ​ 25,587 ​ 25,587 ​ — Construction loans ​ — ​ 1,578 ​ — ​ 1,578 ​ 860,872 ​ 862,450 ​ — Commercial and industrial loans ​ — ​ — ​ — ​ — ​ 111,416 ​ 111,416 ​ — Consumer ​ — ​ — ​ — ​ — ​ 1,023 ​ 1,023 ​ — ​ ​ $ — ​ $ 1,578 ​ $ — ​ $ 1,578 ​ $ 1,115,839 ​ $ 1,117,417 ​ $ — ​ 20 Table of Contents Age Analysis of Past Due Loans as of December 31, 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Recorded ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Investment ​ ​ 30 – 59 Days ​ 60 – 89 Days ​ Greater Than ​ Total Past ​ ​ ​ ​ Total Loans ​ > 90 Days and ​ Past Due Past Due 90 Days Due Current Receivable Accruing ​ ​ (In Thousands) Residential real estate: ​ ​ ​ ​ ​ ​ ​ One- to four-family ​ $ — ​ $ — ​ $ — ​ $ — ​ $ 7,189 ​ $ 7,189 ​ $ — Multi-family ​ — ​ — ​ — ​ — ​ 84,425 ​ 84,425 ​ — Mixed-use ​ — ​ — ​ — ​ — ​ 28,744 ​ 28,744 ​ — Non-residential real estate ​ — ​ — ​ — ​ — ​ 50,016 ​ 50,016 ​ — Construction loans ​ — ​ — ​ — ​ — ​ 683,830 ​ 683,830 ​ — Commercial and industrial loans ​ — ​ — ​ — ​ — ​ 118,378 ​ 118,378 ​ — Consumer ​ — ​ — ​ — ​ — ​ 269 ​ 269 ​ — ​ ​ $ — ​ $ — ​ $ — ​ $ — ​ $ 972,851 ​ $ 972,851 ​ $ — ​ The following tables provide certain information related to the credit quality of our loan portfolio. Credit Risk Profile by Internally Assigned Grade as of September 30, 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential ​ Non-residential ​ ​ ​ ​ Commercial ​ ​ ​ ​ ​ ​ ​ Real Estate Real Estate Construction and Industrial Consumer Total ​ ​ (In Thousands) Grade: ​ ​ ​ ​ ​ ​ Pass ​ $ 116,941 ​ $ 25,587 ​ $ 862,450 ​ $ 111,416 ​ $ 1,023 ​ $ 1,117,417 Special Mention ​ — ​ — ​ — ​ — ​ — ​ — Substandard ​ — ​ — ​ — ​ — ​ — ​ — Doubtful ​ — ​ — ​ — ​ — ​ — ​ — ​ ​ $ 116,941 ​ $ 25,587 ​ $ 862,450 ​ $ 111,416 ​ $ 1,023 ​ $ 1,117,417 ​ Credit Risk Profile by Internally Assigned Grade as of December 31, 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential ​ Non-residential ​ ​ ​ ​ Commercial ​ ​ ​ ​ ​ ​ ​ Real Estate Real Estate Construction and Industrial Consumer Total ​ ​ (In Thousands) Grade: ​ ​ ​ ​ ​ ​ Pass ​ $ 120,358 ​ $ 49,270 ​ $ 683,830 ​ $ 118,378 ​ $ 269 ​ $ 972,105 Special Mention ​ — ​ — ​ — ​ — ​ — ​ — Substandard ​ — ​ 746 ​ — ​ — ​ — ​ 746 Doubtful ​ — ​ — ​ — ​ — ​ — ​ — ​ ​ $ 120,358 ​ $ 50,016 ​ $ 683,830 ​ $ 118,378 ​ $ 269 ​ $ 972,851 ​ 21 Table of Contents Troubled Debt Restructuring: The following table shows our recorded investment for loans classified as a troubled debt restructuring (a “TDR”) that are performing according to their restructured terms at the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, ​ December 31, ​ ​ ​ 2022 ​ 2021 ​ ​ ​ Number of ​ Recorded ​ Number of ​ Recorded ​ ​ contracts Investment contracts Investment ​ ​ ​ (Dollars in Thousands) ​ Residential Real Estate - Mixed-use 2 ​ $ 861 2 ​ $ 876 ​ Non-residential real estate — ​ — 2 ​ 746 ​ Total performing 2 ​ $ 861 4 ​ $ 1,622 ​ ​ The following is a summary of interest foregone on loans classified as a TDR for the three and nine month periods ended September 30, 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ Nine Months Ended September 30, ​ 2022 2021 ​ 2022 2021 ​ ​ (In Thousands) ​ (In Thousands) Interest income that would have been recognized had the loans performed in accordance with their original terms ​ $ 21 ​ $ 54 ​ $ 62 ​ $ 130 Less: Interest income included in the results of operations ​ 11 ​ ​ 33 ​ 47 ​ 95 Total foregone interest ​ $ 10 ​ $ 21 ​ $ 15 ​ $ 35 ​ There were no loans modified that were deemed to be a TDR during the nine months ended September 30, 2022 and 2021. During the three and nine months ended September 30, 2022 and 2021, none of the loans that were modified during the previous twelve months had defaulted. ​ ​ Note 7 — Real Estate Owned (“REO”) The Company owned one foreclosed property valued at approximately $ 1,807,000 at September 30, 2022 and $ 1,996,000 at December 31, 2021, consisting of an office building located in Pennsylvania. The property was acquired through foreclosure in December 2014. Further declines in real estate values may result in impairment charges in the future. Routine holding costs are charged to expense as incurred and improvements to real estate owned that enhance the value of the real estate are capitalized. REO expense recorded in the consolidated statements of income amounted to $ 200,000 and $ 17,000 for the three months, and $ 252,000 and $ 85,000 for the nine months ended September 30, 2022 and 2021, respectively. 22 Table of Contents Note 8 — Federal Home Loan Bank of New York (“FHLB”) Advances FHLB advances are summarized as follows at September 30, 2022 and December 31, 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, ​ December 31, ​ ​ ​ 2022 ​ 2021 ​ ​ ​ Weighted Average ​ Weighted Average ​ ​ ​ Amount ​ Interest Rate ​ Amount ​ Interest Rate ​ ​ ​ (Dollars in Thousands) ​ Advances maturing in: ​ ​ ​ ​ One year or less ​ $ 7,000 ​ 2.83 % $ 7,000 ​ 2.79 % ​ After one to three years ​ ​ 7,000 2.86 % ​ 14,000 2.85 % ​ After five years (due 2030) ​ 7,000 1.61 % 7,000 1.61 % ​ ​ ​ $ 21,000 2.43 % $ 28,000 2.52 % ​ ​ At September 30, 2022, none of the above advances were subject to early call or redemption features. All advances had fixed interest rates and the term of the advance ranges between 2 and 10 years . At September 30, 2022, the advances were secured by a pledge of the Company’s investment in the capital stock of the FHLB and a blanket assignment of the Company’s otherwise unpledged qualifying mortgage loans. At September 30, 2022, these unpledged qualifying mortgage loans were not pledged to any company other than the FHLB. At September 30, 2022, the Company had the ability to borrow $ 18.1 million, net of  $ 21.0 million in outstanding advances, from the FHLB and $ 8.0 million from Atlantic Community Bankers Bank (“ACBB”). ​ Note 9 — Benefits Plans ​ Outside Director Retirement Plan (“DRP”) The DRP is an unfunded non-contributory defined benefit pension plan covering all non-employee directors meeting eligibility requirements as specified in the plan document. The following table sets forth information regarding the components of net pension periodic expense measured as of September 30, 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ Nine Months Ended September 30, ​ 2022 2021 ​ 2022 2021 ​ ​ (Dollars In Thousands) ​ (Dollars In Thousands) Net periodic pension expense: ​ ​ ​ ​ ​ ​ ​ Service cost ​ $ 30 ​ $ 33 ​ ​ $ 90 ​ $ 98 Interest cost ​ 14 ​ ​ 10 ​ ​ 42 ​ 30 Actuarial loss recognized ​ 7 ​ ​ 8 ​ ​ 20 ​ 24 Total net periodic pension expense included in other non-interest expenses ​ $ 51 ​ $ 51 ​ ​ $ 152 ​ $ 152 ​ Unrecognized net loss of $ 23,000 and unrealized net gain of $ 14,000 for the three months, and unrecognized net loss of $ 63,000 and unrecognized net gain of $ 35,000 for the nine months ended September 30, 2022 and 2021, respectively, were included in accumulated other comprehensive income. Supplemental Executive Retirement Plan (“SERP”) The SERP is a non-contributory defined benefit plan that covers certain officers of the Company. Under the SERP, each of these individuals will be entitled to receive upon retirement an annual benefit paid in monthly installments equal to 50 % of his average base salary in the three-year period preceding retirement. Each individual may also retire early and receive a reduced benefit upon the attainment of certain age and years of service combination. Additional terms related to death while employed, death after retirement, disability before retirement and termination of employment are fully described within the plan document. The benefit payment term is the greater of 15 years or the executives remaining life. No benefits are expected to be paid during the next five years . 23 Table of Contents Expenses of $ 121,000 and $ 132,000 for the three months, and $ 361,000 and $ 359,000 for the nine months ended September 30, 2022 and 2021, respectively, were recorded for this plan and are reflected in the Consolidated Statements of Income under Salaries and Employee Benefits. Stock-Based Deferral Plan In June 2021, the Company established a stock-based deferral plan for eligible key executives and members of the Board of Directors of the Company to elect to defer compensation received from the Company for their services and make deemed investments of that deferred compensation in shares of the Company’s common stock. At September 30, 2022, the Company did not have any obligations under the plan. 401(k) Plan The Company maintains a 401(k) plan for all eligible employees. Participants are permitted to contribute from 1 % to 15 % or 60 % of their annual compensation up to the maximum permitted under the Internal Revenue Code. The Company provided no matching contribution during the three and nine months ended September 30, 2022 and 2021. Employee Stock Ownership Plan (“ESOP”) In conjunction with the Mid-Tier Holding Company’s public stock offering in 2006, the Bank established an ESOP for all eligible employees (substantially all full-time employees). The ESOP borrowed $ 5,184,200 from the Mid-Tier Holding Company and used those funds to acquire 518,420 shares of the Mid-Tier Holding Company common stock at $ 10.00 per share. The loan from the Mid-Tier Holding Company, which has been assumed by the Company, carries an interest rate of 8.25 % and is repayable in twenty annual installments through 2025. In conjunction with the Company’s second-step conversion offering, on July 12, 2021, the ESOP borrowed $ 7,827,260 from the Company and used those funds to acquire 782,726 shares of Company common stock at $ 10.00 per share. The loan from the Company carries an interest rate equal to 3.25 % and is repayable in fifteen annual installments through 2035. Each year, the Bank makes discretionary contributions to the ESOP equal to the principal and interest payment required on the loan from the Company. The ESOP may further pay down the principal balance of the loans by using dividends paid, if any, on the shares of Company common stock it owns. The balance remaining on the first ESOP loan was $ 1,703,000 at September 30, 2022 and December 31, 2021. The balance remaining on the second ESOP loan was $ 7,270,000 at September 30, 2022 and December 31, 2021. Shares purchased with the loan proceeds serve as collateral for the loan and are held in a suspense account for future allocation among ESOP participants. As the loan principal is repaid, shares will be released from the suspense account and become eligible for allocation. The allocation among plan participants will be as described in the ESOP governing document. ESOP shares initially pledged as collateral were recorded as unearned ESOP shares in the stockholders’ equity section of the consolidated statement of financial condition. Thereafter, on a monthly basis over the terms of the ESOP loans, approximately 2,894 shares for the ESOP loan made in 2006 and approximately 4,348 shares for the ESOP loan made in 2021 are committed to be released respectively. Compensation expense is recorded equal to the shares committed to be released multiplied by the average closing price of the Company’s stock during that month. ESOP expense totaled approximately $ 271,000 and $ 491,000 for the three months, and $ 775,000 and $ 694,000 for the nine months ended September 30, 2022 and 2021, respectively. Dividends on unallocated shares, which totaled approximately $ 52,000 and $ 57,000 for the three months, and $ 313,000 and $ 61,000 for the nine months ended September 30, 2022 and 2021, are recorded as a reduction of the ESOP loan. Dividends on allocated shares, which totaled approximately $ 36,000 and $ 31,000 for the three months, and $ 219,000 and $ 43,000 for the nine months ended September 30, 2022 and 2021, respectively, are charged to retained earnings. 24 Table of Contents ESOP shares are summarized as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, ​ December 31, ​ ​ ​ 2022 ​ 2021 ​ Allocated shares ​ ​ 607,922 ​ 521,012 ​ Shares committed to be released ​ ​ 65,190 ​ 86,910 ​ Unearned shares ​ ​ 804,297 ​ 869,487 ​ Total ESOP Shares ​ ​ 1,477,409 ​ 1,477,409 ​ Less allocated shares distributed to former or retired employees ​ ​ ( 112,548 ) ​ ( 106,369 ) ​ Total ESOP Shares Held by Trustee ​ ​ 1,364,861 ​ 1,371,040 ​ Fair value of unearned shares ​ $ 9,973,281 ​ $ 9,677,390 ​ ​ ​ ​ Note 10 — Leases The Company has operating leases and finance leases all comprised of real estate property. The operating leases comprise substantially all of the Company’s obligations in which the Company is the lessee, with remaining lease terms ranging between 2 and 9 years . Most operating lease agreements consist of initial lease terms ranging between 5 and 10 years , with options to renew the leases or extend the term. The finance lease has a remaining lease term of 95 years . The payment structure of all leases is fixed rental payments with lease payments increasing on pre-determined dates at either a predetermined amount or change in the consumer price index. In accordance with ASC 842, the Company recognized operating and financing lease assets and corresponding lease liabilities related to office facilities and retail branches. The operating and financing lease assets represent the Company’s right to use an underlying asset for the lease term, and the lease liability represents the Company’s obligation to make lease payments over the lease term. The Company has elected that any short term leases would be expensed as incurred. The operating and financing lease asset and lease liability are determined at the commencement date of the lease based on the present value of the lease payments. Our leases do not provide an implicit interest rate. The company used its incremental borrowing rate, the rate of interest to borrow in a collateralized basis for a similar term, at the lease commencement date. All of the leases are net leases and, therefore, do not contain non-lease components. The Company either pays directly or reimburses the lessor for property and casualty insurance cost and the property taxes assessed on the property, as well as a portion of the common area maintenance associated with the property which are categorized as non-components as outlined in the applicable guidance. At September 30, 2022 and December 31, 2021, the quantitative data relating to the Company’s leases are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, December 31, ​ ​ 2022 ​ 2021 Finance Lease Amounts: ​ ​ ​ ROU asset ​ $ 356 ​ $ 359 ​ Lease liability ​ $ 524 ​ $ 496 ​ Operating Lease Amounts: ​ ​ ​ ​ ROU assets ​ $ 2,161 ​ $ 2,564 ​ Lease liabilities ​ $ 2,210 ​ $ 2,604 ​ Weighted-average remaining lease term ​ ​ ​ Finance lease ​ 95 years ​ 95 years ​ Operating leases ​ 6.73 years ​ 7.02 years ​ Weighted-average discount rate ​ ​ ​ Finance lease ​ 9.50 % 9.50 % Operating leases ​ 1.14 % 1.22 % 25 Table of Contents The components of lease expense and cash flow information related to leases as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, Nine Months Ended September 30, ​ ​ 2022 2021 2022 2021 ​ ​ (Dollars In Thousands) ​ (Dollars In Thousands) ​ Finance Lease Cost ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of ROU asset ​ $ 1 ​ ​ 1 ​ $ 3 ​ $ 3 ​ Interest on lease liability ​ $ 9 ​ ​ 9 ​ $ 28 ​ $ 27 ​ Operating Lease Costs ​ $ 140 ​ ​ 142 ​ $ 423 ​ $ 425 ​ Cash paid for amounts included in the measurement of lease liabilities ​ ​ ​ ​ ​ ​ ​ ​ ​ Finance lease ​ $ — ​ ​ — ​ $ — ​ $ — ​ Operating leases ​ $ 279 ​ ​ 136 ​ $ 417 ​ $ 407 ​ ​ Maturities of lease liabilities at September 30, 2022 are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating Finance ​ ​ Leases ​ Lease Years ended December 31: ​ ​ ​ ​ ​ ​ 2022 ​ $ 129 ​ $ 23 2023 ​ 423 ​ 30 2024 ​ 333 ​ 30 2025 ​ 302 ​ 30 2026 ​ 235 ​ 31 Thereafter ​ 875 ​ 4,158 Total lease payments ​ $ 2,297 ​ $ 4,302 Interest ​ ( 87 ) ​ ( 3,778 ) Lease liability ​ $ 2,210 ​ $ 524 ​ ​ ​ Note 11 — Fair Value Disclosures The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. The Company’s securities available for sale are recorded at fair value on a recurring basis. Additionally, from time to time, the Company has to record at fair value other assets and liabilities on a non-recurring basis, such as securities held to maturity, impaired loans and other real estate owned. U.S. GAAP has established a fair value hierarchy that prioritizes the inputs to valuation methods used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: Level 1 : Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. Level 3 : Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported with little or no market activity). 26 Table of Contents An asset’s or liability’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The following table sets forth the Company’s assets that are carried at fair value on a recurring basis and the level that was used to determine their fair value at September 30, 2022 and December 31, 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Quoted Prices in ​ Significant Other ​ Significant ​ Total Carried ​ ​ Active Markets for ​ Observable ​ Unobservable ​ at Fair ​ ​ Identical Assets ​ Inputs ​ Inputs ​ Value on a ​ ​ (Level 1) ​ (Level 2) ​ (Level 3) ​ Recurring Basis ​ ​ September 30, ​ December 31, ​ September 30, ​ December 31, ​ September 30, ​ December 31, ​ September 30, ​ December 31, Description 2022 2021 2022 2021 2022 2021 2022 2021 Assets: ​ ​ ​ ​ ​ ​ ​ ​ Marketable equity securities: ​ ​ ​ ​ ​ ​ ​ ​ Mutual funds ​ $ 18,307 ​ $ 19,943 ​ $ — ​ $ — ​ $ — ​ $ — ​ $ 18,307 ​ $ 19,943 Mortgage-backed securities ​ ​ ​ ​ ​ ​ ​ ​ FHLMC ​ — ​ — ​ 1 ​ 1 ​ — ​ — ​ 1 ​ 1 Total assets ​ $ 18,307 ​ $ 19,943 ​ $ 1 ​ $ 1 ​ $ — ​ $ — ​ $ 18,308 ​ $ 19,944 ​ There were no transfers between Level 1 and 2 during the three and nine months ended September 30, 2022 or the year ended December 31, 2021. The Company did no t have any liabilities that were carried at fair value on a recurring basis at September 30, 2022 and December 31, 2021. The following table sets forth the Company’s assets that are carried at fair value on a non-recurring basis and the level that was used to determine their fair value, at September 30, 2022 and December 31: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Quoted Prices in ​ Significant Other ​ Significant ​ Total Carried ​ ​ Active Markets for ​ Observable ​ Unobservable ​ at Fair ​ ​ Identical Assets ​ Inputs ​ Inputs ​ Value on a ​ ​ (Level 1) ​ (Level 2) ​ (Level 3) ​ Non-Recurring Basis ​ ​ September 30, ​ December 31, ​ September 30, ​ December 31, ​ September 30, ​ December 31, ​ September 30, ​ December 31, Description 2022 2021 2022 2021 2022 2021 2022 2021 ​ (In Thousands) Assets: ​ ​ ​ ​ ​ ​ ​ ​ Real estate owned ​ — ​ — ​ — ​ — ​ 1,807 ​ — ​ 1,807 ​ — Total assets ​ $ — ​ $ — ​ $ — ​ $ — ​ $ 1,807 ​ $ — ​ $ 1,807 ​ $ — ​ The following tables present the qualitative information about non-recurring Level 3 fair value measurements of financial instruments at the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At September 30, 2022 ​ Fair Valuation Unobservable ​ Weighted ​ ​ Value ​ Technique ​ Input ​ Range ​ Average ​ ​ (In Thousands) Assets: ​ ​ ​ Real estate owned ​ 1,807 Income approach Capitalization rate 11.00 % 11.00 % ​ The Company did no t have any liabilities that were carried at fair value on a non-recurring basis at September 30, 2022 and December 31, 2021. The methods and assumptions used to estimate fair value at September 30, 2022 and December 31, 2021 are as follows: For real estate owned, fair value is generally determined through independent appraisals or fair value estimations of the underlying properties which generally include various Level 3 inputs which are not identifiable. The appraisals or fair value estimation may be adjusted by management for qualitative reasons and estimated liquidation expenses. 27 Table of Contents Management’s assumptions may include consideration of location and occupancy of the property and current economic conditions. Subsequently, as these properties are actively marketed, the estimated fair values may be periodically adjusted through incremental subsequent write-downs to reflect decreases in estimated values resulting from sales price observations and the impact of changing economic and market conditions. A loan is considered impaired when, based upon current information and events; it is probable that the Company will be unable to collect all scheduled payments in accordance with the contractual terms of the loan. Impaired loans that are collateral dependent are written down to fair value through the establishment of specific reserves, a component of the allowance for loan losses or through partial charge-offs, and as such are carried at the lower of cost or the fair value. Estimates of fair value of the collateral are determined based on a variety of information, including available valuations from certified appraisers for similar assets, present value of discounted cash flows and inputs that are estimated based on commonly used and generally accepted industry liquidation advance rates and estimates and assumptions developed by management. The appraisals may be adjusted by management for estimated liquidation expenses and qualitative factors such as economic conditions. If real estate is not the primary source of repayment, present value of discounted cash flows and estimates using generally accepted industry liquidation advance rates are utilized. Due to the multitude of assumptions, many of which are subjective in nature, and the varying inputs and techniques used by appraisers, the Company recognizes that valuations could differ across a wide spectrum of valuation techniques employed and accordingly, fair value estimates for impaired loans are classified as Level 3. Management uses its best judgment in estimating the fair value of the Company’s financial instruments; however, there are inherent weaknesses in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates herein are not necessarily indicative of the amounts the Company could have realized in a sales transaction on the dates indicated. The estimated fair value amounts have been measured as of their respective year-ends and have not been re-evaluated or updated for purposes of these financial statements subsequent to those respective dates. As such, the estimated fair values of these financial instruments subsequent to the respective reporting dates may be different than the amounts reported at each year-end. The following information should not be interpreted as an estimate of the fair value of the entire Company since a fair value calculation is only provided for a limited portion of the Company’s assets and liabilities. Due to a wide range of valuation techniques and the degree of subjectivity used in making the estimates, comparisons between the Company’s disclosures and those of other companies may not be meaningful. The following methods and assumptions were used to estimate the fair values of the Company’s financial instruments at September 30, 2022 and December 31, 2021: Securities Fair values for marketable equity securities are determined by quoted market prices on nationally recognized and foreign securities exchanges (Level 1). Fair values for securities available for sale and held to maturity are determined utilizing Level 2 inputs. For these securities, the Company obtains fair value measurements from an independent pricing service. The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, live trading levels, trade execution data, market consensus prepayments speeds, credit information and the security’s terms and conditions, among other things. 28 Table of Contents The carrying amounts and estimated fair value of our financial instruments are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value at September 30, 2022 ​ ​ ​ ​ ​ Quoted ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Prices in ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Active ​ Significant ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Markets for ​ Other ​ Significant ​ ​ ​ ​ ​ ​ ​ Identical ​ Observable ​ Unobservable ​ ​ Carrying ​ ​ ​ ​ Assets ​ Inputs ​ Inputs (In thousands) Amount Fair Value (Level 1) (Level 2) (Level 3) Financial Assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 54,932 ​ $ 54,932 ​ $ 54,932 ​ $ — ​ $ — Certificates of deposit ​ ​ 100 ​ ​ 100 ​ ​ — ​ ​ 100 ​ ​ — Marketable equity securities ​ ​ 18,307 ​ ​ 18,307 ​ ​ 18,307 ​ ​ — ​ ​ — Securities available for sale ​ ​ 1 ​ ​ 1 ​ ​ — ​ ​ 1 ​ ​ — Securities held to maturity ​ ​ 26,732 ​ ​ 22,900 ​ ​ — ​ ​ 22,900 ​ ​ — Loans receivable, net ​ ​ 1,112,507 ​ ​ 1,097,136 ​ ​ — ​ ​ — ​ ​ 1,097,136 Investments in restricted stock ​ ​ 1,238 ​ ​ 1,238 ​ ​ — ​ ​ 1,238 ​ ​ — Accrued interest receivable ​ ​ 6,635 ​ ​ 6,635 ​ ​ — ​ ​ 6,635 ​ ​ — Financial Liabilities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Deposits ​ ​ 987,624 ​ ​ 986,647 ​ ​ — ​ ​ 986,647 ​ ​ — FHLB of New York advances ​ ​ 21,000 ​ ​ 19,540 ​ ​ — ​ ​ 19,540 ​ ​ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value at December 31, 2021 ​ ​ ​ ​ ​ ​ Quoted ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Prices in ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Active ​ Significant ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Markets for ​ Other ​ Significant ​ ​ ​ ​ ​ ​ ​ Identical ​ Observable ​ Unobservable ​ ​ Carrying ​ ​ ​ ​ Assets ​ Inputs ​ Inputs (In thousands) Amount Fair Value (Level 1) (Level 2) (Level 3) Financial Assets ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 152,269 ​ $ 152,269 ​ $ 152,269 ​ $ — ​ $ — Certificates of deposit ​ ​ 100 ​ ​ 100 ​ ​ — ​ ​ 100 ​ ​ — Marketable equity securities ​ ​ 19,943 ​ ​ 19,943 ​ ​ 19,943 ​ ​ — ​ ​ — Securities available for sale ​ ​ 1 ​ ​ 1 ​ ​ — ​ ​ 1 ​ ​ — Securities held to maturity ​ ​ 17,880 ​ ​ 17,620 ​ ​ — ​ ​ 17,620 ​ ​ — Loans receivable, net ​ ​ 968,093 ​ ​ 968,247 ​ ​ — ​ ​ — ​ ​ 968,247 Investments in restricted stock ​ ​ 1,569 ​ ​ 1,569 ​ ​ — ​ ​ 1,569 ​ ​ — Accrued interest receivable ​ ​ 4,283 ​ ​ 4,283 ​ ​ — ​ ​ 4,283 ​ ​ — Financial Liabilities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Deposits ​ ​ 927,164 ​ ​ 929,003 ​ ​ — ​ ​ 929,003 ​ ​ — FHLB of New York advances ​ ​ 28,000 ​ ​ 28,283 ​ ​ — ​ ​ 28,283 ​ ​ — ​ ​ ​ Note 12 — Revenue Recognition The majority of the Company’s revenues come from interest income and other sources, including loans and securities that are outside the scope of ASC 606, Revenue from Contracts with Customers. The Company’s services that fall within the scope of ASC 606 are presented within noninterest income and are recognized as revenue as the Company satisfies its obligation to the customer. Services within the scope of ASC 606 include deposit service charges on deposits, electronic banking fees and charges income, and investment advisory fees. A contract asset balance occurs when an entity performs a service for a customer before the customer pays consideration (resulting in a contract receivable) or before payment is due (resulting in a contract asset). A contract 29 Table of Contents liability balance is an entity’s obligation to transfer a service to a customer for which the entity has already received payment (or payment is due) from the customer. The Company’s noninterest revenue streams are largely based on transactional activity, or standard month-end revenue accruals such as referral fees based month end reports. Consideration is often received immediately or shortly after the Company satisfies its performance obligation and revenue is recognized. The Company does not typically enter into long-term revenue contracts with customers, and therefore, does not experience significant contract balances. As of September 30, 2022, the Company did not have any significant contract balances. All of the Company’s revenue from contracts with customers within the scope of ASC 606 is recognized within noninterest income. The following table presents the Company’s sources of noninterest income for the three and nine months ended September 30, 2022 and 2021. Sources of revenue outside the scope of ASC 606 are noted as such: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ Nine Months Ended September 30, ​ ​ 2022 2021 ​ 2022 2021 ​ ​ ​ (In Thousands) ​ (In Thousands) ​ Non-interest income: ​ ​ ​ ​ ​ ​ ​ Deposit-related fees and charges ​ $ 17 ​ $ 16 ​ $ 53 ​ $ 50 ​ Loan-related fees and charges (1) ​ 308 ​ ​ 193 ​ 861 ​ 561 ​ Electronic banking fees and charges ​ 219 ​ ​ 172 ​ 648 ​ 484 ​ Gain on disposition of equipment (1) ​ 52 ​ ​ — ​ 98 ​ 7 ​ Income from bank owned life insurance (1) ​ 153 ​ ​ 152 ​ 450 ​ 447 ​ Investment advisory fees ​ 107 ​ ​ 139 ​ 364 ​ 381 ​ Unrealized loss on equity securities (1) ​ ( 573 ) ​ ​ ( 154 ) ​ ( 1,636 ) ​ ( 215 ) ​ Miscellaneous (1) ​ 26 ​ ​ 14 ​ 66 ​ 38 ​ Total non-interest income ​ $ 309 ​ $ 532 ​ $ 904 ​ $ 1,753 ​ (1) Not within the scope of ASC 606. A description of the Company’s revenue streams accounted for under ASC 606 is as follows: Service Charges on Deposit Accounts The Company earns fees from deposit customers for transaction-based, account maintenance, and overdraft services. Transaction-based fees, which include services such as ATM use fees, stop payment charges, statement rendering, and ACH fees, are recognized at the time the transaction is executed at the point in the time the Company fulfills the customer’s request. The Company discontinued the imposition of overdraft fees on all consumer and business accounts in August 2022. Account maintenance fees, which relate primarily to monthly maintenance, are earned over the course of a month, representing the period over which the Company satisfies the performance obligation. Overdraft fees are recognized at the point in time that the overdraft occurs. Service charges on deposits are withdrawn from the customer’s account balance. Electronic Banking Fee Income The Company earns interchange fees from debit and credit card holder transactions conducted through various payment networks. Interchange fees from cardholder transactions are recognized daily, concurrently with the transaction processing services provided by an outsourced technology solution. Investment Advisory Fees The Company earns fees from investment advisory and financial planning services under the name of Harbor West Financial Planning Wealth Management, a division of the Company through a networking arrangement with a registered broker-dealer and investment advisor. The registered broker-dealer deducts investment advisory fees and financial 30 Table of Contents planning services fees from the client’s assets under management and remits the fees, net of administrative fees, to the Company on a monthly basis. The Company recognizes the fees into non-interest income upon receipt of the monthly remittances. ​ Note 13 — Other Non-Interest Expenses The following is an analysis of other non-interest expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ Nine Months Ended September 30, ​ ​ 2022 2021 ​ 2022 2021 ​ ​ ​ (In Thousands) ​ (In Thousands) ​ Other ​ $ 751 ​ $ 520 ​ $ 2,088 ​ $ 1,487 ​ Service contracts ​ 275 ​ ​ 220 ​ 804 ​ 645 ​ Consulting expense ​ 251 ​ ​ 266 ​ 710 ​ 844 ​ Telephone ​ 145 ​ ​ 143 ​ 437 ​ 430 ​ Directors compensation ​ 155 ​ ​ 144 ​ 436 ​ 413 ​ Audit and accounting ​ 163 ​ ​ 115 ​ 463 ​ 371 ​ Insurance ​ 95 ​ ​ 73 ​ 273 ​ 221 ​ Director, officer, and employee expense ​ 73 ​ ​ 59 ​ 201 ​ 185 ​ Legal fees ​ 283 ​ ​ 62 ​ 640 ​ 165 ​ Office supplies and stationary ​ 23 ​ ​ 30 ​ 100 ​ 94 ​ Recruiting expense ​ 23 ​ ​ 1 ​ 68 ​ 2 ​ ​ ​ $ 2,237 ​ $ 1,633 ​ $ 6,220 ​ $ 4,857 ​ ​ ​ Note 14 — Recent Accounting Pronouncements Accounting Standards Pending Adoption: ASU 2016-13 - Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In June 2016, the FASB issued ASU No. 2016-13 "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments," which requires credit losses on most financial assets to be measured at amortized cost and certain other instruments to be measured using an expected credit loss model (referred to as the current expected credit loss (CECL) model). Under this model, entities will estimate credit losses over the entire contractual term of the instrument (considering estimated prepayments but not expected extensions or modifications unless reasonable expectation of a troubled debt restructuring exists) from the date of initial recognition of that instrument. The ASU also replaces the current accounting model for purchased credit impaired loans and debt securities. The allowance for credit losses for purchased financial assets with a more-than-insignificant amount of credit deterioration since origination ("PCD assets") should be determined in a similar manner to other financial assets measured on an amortized cost basis. Upon initial recognition, the allowance for credit losses is added to the purchase price ("gross up approach") to determine the initial amortized cost basis. The subsequent accounting for PCD assets will use the CECL model described above. The ASU made certain targeted amendments to the existing impairment model for available-for-sale (AFS) debt securities. For an AFS debt security for which there is neither the intent nor a more-likely-than-not requirement to sell, an entity will record credit losses as an allowance rather than a write-down of the amortized cost basis. As amended, ASU No. 2016-13 and any related amending ASUs No. 2019-04, 2019-11, 2020-03, and 2022-02 are effective for entities qualifying as smaller reporting companies for fiscal years beginning after December 15, 2022, including interim periods within those years. Early adoption is permitted for all entities as of the fiscal year beginning after December 15, 2018, including interim periods within those fiscal years. 31 Table of Contents The Company is actively working on preliminary test calculations, and data validation, as well as process and procedural documentation. Management is in the process of evaluating the impact adoption of ASU 2016-13 will have on the Company’s Consolidated Financial Statements. This process has engaged multiple areas of the Company in evaluating loss estimation methods and application of these methods to specific segments of the loan portfolio. Management has been actively monitoring FASB developments and evaluating the use of different methods allowed. Due to continuing development of our methodology, additional time is required to quantify the effect this ASU will have on the Company’s Consolidated Financial Statements. Management plans on running parallel calculations and finalizing a method or methods of adoption in time for the effective date. ​ The Company will utilize a lifetime loss rate calculation for all its loan portfolio, as well as supplement the loss estimate by including reasonable and supportable forecasts of macroeconomic conditions. The Company began to perform parallel runs of the new model in comparison to its current ALLL model during the third quarter of 2022 and continues to evaluate the results and assumptions. Implementation efforts are continuing to focus on model validation, model calibration, qualitative factors, finalizing procedures and other governance, and control documentation. The Company will adopt this new guidance on January 1, 2023, and is currently evaluating the impact of this new guidance on its consolidated financial statements. ​ ASU 2020-04 - Reference Rate Reform (Topic 848) In March 2020, the FASB issued ASU No. 2020-04, "Reference Rate Reform (Topic 848)" which provides optional expedients and exceptions for applying U.S. GAAP to contract modifications and hedging relationships that reference LIBOR or another reference rate expected to be discontinued, subject to meeting certain criteria. Under the new guidance, an entity can elect by accounting topic or industry subtopic to account for the modification of a contract affected by reference rate reform as a continuation of the existing contract, if certain conditions are met. In addition, the new guidance allows an entity to elect on a hedge-by-hedge basis to continue to apply hedge accounting for hedging relationships in which the critical terms change due to reference rate reform, if certain conditions are met. A one-time election to sell and/or transfer held-to-maturity debt securities that reference a rate affected by reference rate reform is also allowed. ASU No. 2020-04 became effective for all entities as of March 12, 2020 and will apply to all LIBOR reference rate modifications through December 31, 2022. ASU 2021-01 - Reference Rate Reform (Topic 848) In January 2021, the FASB issued ASU No. 2021-01, "Reference Rate Reform (Topic 848)". The amendments in this update clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. Specifically, certain provisions in Topic 848, if elected by an entity, apply to derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. Amendments in this update to the expedients and exceptions in Topic 848 capture the incremental consequences of the scope clarification and tailor the existing guidance to derivative instruments affected by the discounting transition. ASU No. 2021-01 became immediately effective for all entities, which may elect to apply the update retrospectively as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or prospectively to new modifications from any date within an interim period that includes or is subsequent to the issuance date of ASU No. 2021-01 up to the date that financial statements are available to be issued. In addition, ASU No.2021-01 applies to all contract modifications made through December 31, 2022. We are evaluating the impacts of this ASU and have not yet determined whether LIBOR transition and this ASU will have material effects on our business operations and consolidated financial statements. The amendments in this update apply to contract modifications that replace a reference rate reform and contemporaneous modifications of other terms related to the replacement of the reference rate. ​ Note 15 — Stock Compensation Plans At a special shareholders meeting held on September 29, 2022, our shareholders approved the Company’s 2022 Equity Incentive Plan whereby 1,369,771 shares of the Company’s common stock have been reserved from authorized but unissued shares for purposes of grants of incentive stock options, nonqualified stock options, restricted stock, 32 Table of Contents restricted stock units, performance shares and performance units to selected employees and non-employee directors of the Company. At September 30, 2022, 86,880 shares of restricted stock and 217,206 nonqualified stock options in the aggregate were awarded to six non-employee directors of the Company as set forth in the 2022 Equity Incentive Plan. The fair value of restricted stock is determined by the product of the number of shares granted and the final market price of the Company’s common stock at the grant date. The fair value of the share-based payments for the nonqualified stock options is estimated using the Black-Scholes option-pricing model. The aggregate fair value of the restricted stock and nonqualified stock options totaled $ 1.1 million and $ 843,000 , respectively, at the date of the grants to our non-employee directors on September 30, 2022. The assumptions used to estimate the fair value of the nonqualified stock options includes 7.5 expected life, 3.97 % risk free interest rate, 1.94 % projected dividend yield, and 28.94 % volatility rate. The restricted stock and nonqualified stock options granted to the non-employee directors vest at a rate of 20 % per year from the date of the grant. The Company recognizes compensation costs for the fair value of the restricted stock and stock options on a straight-line basis over the requisite service period of five years . During the three and nine months ended at September 30, 2022, there were no compensation costs recognized.