What changed in this filing

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Item 1. Financial Statements

2023-08-10 compared with 2023-05-12 · 177 added, 105 removed, 761 unchanged (27% of the section changed)

53 unchanged sentences

CONSOLIDATED STATEMENTS OF INCOME

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(In thousands, except per share amounts)

INTEREST INCOME:

9 unchanged sentences

Other loan fees and service charges

Gain on disposition of equipment

Earnings on bank owned life insurance

17 unchanged sentences

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(In thousands)

Other comprehensive income:

6 unchanged sentences

Total Comprehensive Income

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.

¹ Amounts are included in provision for income taxes in the consolidated statements of income.

2 unchanged sentences

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

Three Months Ended March 31, 2023 and 2022

Three and Six Months Ended June 30, 2023 and 2022

Comprehensive

9 unchanged sentences

Balance - March 31, 2023

Other comprehensive income

Cash dividend declared ($ 0.06 per share)

Stock repurchases

Compensation expense related to restricted stock awards

Compensation expense related to stock options

ESOP shares earned

Balance – June 30, 2023

Comprehensive

5 unchanged sentences

Balance - March 31, 2022

Other comprehensive income

Cash dividend declared ($ 0.06 per share)

ESOP shares earned

Balance - June 30, 2022

See notes to interim unaudited consolidated financial statements.

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended March 31,

Six Months Ended June 30,

(In thousands)

1 unchanged sentence

Adjustments to reconcile net income to net cash provided by operating activities:

Net amortization of securities premiums and discounts, net

Net amortization (accretion) of securities premiums and discounts, net

Provision for credit losses

3 unchanged sentences

Earnings on bank owned life insurance

Gain on dispositions of premises and equipment

ESOP compensation expense

2 unchanged sentences

Increase in accrued interest receivable

Decrease in other assets

(Increase) decrease in other assets

Decrease in accounts payable - loan closing

4 unchanged sentences

Proceeds from sale of loans

Proceeds from bank owned life insurance

Principal repayments on securities available-for-sale

Principal repayments on securities held-to-maturity

Purchase of securities held-to-maturity

Redemptions of restricted stock

5 unchanged sentences

Stock repurchases

Increase in advance payments by borrowers for taxes and insurance

Decrease in advance payments by borrowers for taxes and insurance

Cash dividends paid

Net Cash Provided by Financing Activities

Net (Decrease) Increase in Cash and Cash Equivalents

Net Cash Provided by (Used in) Financing Activities

Net Increase (Decrease) in Cash and Cash Equivalents

Cash and Cash Equivalents – Beginning

3 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

Three Months Ended March 31,

Six Months Ended June 30,

(In thousands)

114 unchanged sentences

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.

The Bank met all capital adequacy requirements to which it was subject as of March 31, 2023 and December 31, 2022.

The Bank met all capital adequacy requirements to which it was subject as of June 30, 2023 and December 31, 2022.

The following table presents information about the Bank’s capital levels at the dates presented:

4 unchanged sentences

(Dollars in Thousands)

As of March 31, 2023:

As of June 30, 2023:

Total capital (to risk-weighted assets)

11 unchanged sentences

Note 3 — Equity Securities

The following table is the schedule of equity securities at March 31, 2023 and December 31, 2022.

The following table is the schedule of equity securities at June 30, 2023 and December 31, 2022.

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 throughout the United States.

2 unchanged sentences

Equity Securities, at Fair Value

The following is a summary of unrealized gain or loss recognized in net income on equity securities during the three months ended March 31, 2023 and 2022:

Three Months Ended March 31,

The following is a summary of unrealized gain or loss recognized in net income on equity securities during the three and six months ended June 30, 2023 and 2022:

Three Months Ended June 30,

Six Months Ended June 30,

(In Thousands)

Net gain (loss) recognized on equity securities during the period

(In Thousands)

Net (loss) gain recognized on equity securities during the period

Net losses realized on the sale of equity securities during the period

1 unchanged sentence

Note 4 — Securities Available-for-Sale

The Company’s portfolio of securities available-for-sale totaled zero and $ 1,000 at March 31, 2023 and December 31, 2022, respectively.

The Company’s portfolio of securities available-for-sale totaled zero and $ 1,000 at June 30, 2023 and December 31, 2022, respectively.

The following table is the schedule of securities available-for-sale at December 31, 2022:

3 unchanged sentences

Federal Home Loan Mortgage Corporation

There were no sales of securities available-for-sale as of March 31, 2023 and December 31, 2022.

At March 31, 2023 and December 31, 2022, the Company had no unrealized loss.

There were no sales of securities available-for-sale as of June 30, 2023 and December 31, 2022.

At June 30, 2023 and December 31, 2022, the Company had no unrealized loss.

Note 5 — Securities Held-to-Maturity

The following table summarizes the Company’s portfolio of securities held-to-maturity at March 31, 2023 and December 31, 2022.

March 31, 2023

The following table summarizes the Company’s portfolio of securities held-to-maturity at June 30, 2023 and December 31, 2022.

June 30, 2023

(In Thousands)

6 unchanged sentences

Municipal Bonds

Treasury securities

December 31, 2022

8 unchanged sentences

Treasury securities

Contractual final maturities of mortgage-backed securities, municipal bonds, U.S.

Treasury securities were as follows at March 31, 2023:

March 31, 2023

Contractual final maturities of mortgage-backed securities and municipal bonds were as follows at June 30, 2023:

June 30, 2023

(In Thousands)

10 unchanged sentences

Balance – March 31, 2023

Provision for credit loss

Balance – June 30, 2023

The age of unrealized losses and the fair value of related securities held-to-maturity, for which an allowance for credit losses was not deemed necessary, were as follows:

2 unchanged sentences

(In Thousands)

March 31, 2023:

June 30, 2023:

Mortgage-backed securities - residential:

4 unchanged sentences

Total mortgage-backed securities

Treasury securities

Municipal Bonds

Less than 12 Months

10 unchanged sentences

Treasury securities

At March 31, 2023, thirty-four mortgage-backed securities and two U.S.

Treasury notes had unrealized loss due to interest rate volatility.

At June 30, 2023, thirty-one mortgage-backed securities and six municipal bonds 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.

3 unchanged sentences

Credit Quality Indicators

The held to maturity securities portfolio consists of agency mortgage-backed securities, U.S.

Treasuries and municipal bonds.

All agency mortgage-backed securities and U.S.

Treasuries are issued by U.S.

The held to maturity securities portfolio consists of agency mortgage-backed securities and municipal bonds.

All agency mortgage-backed securities are issued by U.S.

government entities and agencies.

1 unchanged sentence

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

The six municipal bonds in the portfolio carry no lower than A ratings from the rating agencies at March 31, 2023 and have a long history of no credit losses.

The six municipal bonds in the portfolio carry no lower than A ratings from the rating agencies at June 30, 2023 and have a long history of no credit losses.

The Company regularly monitors the municipal bonds sector of the market and reviews collectability including such factors as the financial condition of the issuers as well as credit ratings in effect as of the reporting period.

2 unchanged sentences

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.

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.

5 unchanged sentences

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.

The composition of loans were as follows at March 31, 2023 and December 31, 2022:

The composition of loans were as follows at June 30, 2023 and December 31, 2022:

(In Thousands)

6 unchanged sentences

Allowance for credit losses

Loans serviced for the benefit of others totaled approximately $ 26,112,000 and $ 22,350,000 at March 31, 2023 and December 31, 2022, respectively.

The value of mortgage servicing rights was not material at March 31, 2023 and December 31, 2022.

Loans serviced for the benefit of others totaled approximately $ 34.4 million and $ 22.4 million at June 30, 2023 and December 31, 2022, respectively.

The value of mortgage servicing rights was not material at June 30, 2023 and December 31, 2022.

The allowance for credit losses on loans 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.

6 unchanged sentences

This evaluation is inherently subjective as it requires material estimates that may be susceptible to significant revision as more information becomes available.

The following tables summarize the allocation of the allowance for credit losses based upon the calculation methodology described in Note 1, and loans receivable by loan class and credit loss method at March 31, 2023 and December 31, 2022:

At March 31, 2023:

At June 30, 2023:

(In Thousands)

25 unchanged sentences

collectively evaluated for impairment

The activity in the allowance for credit loss by loan class for the three months ended March 31, 2023 and 2022 was as follows:

The activity in the allowance for credit loss by loan class for the three and six months ended June 30, 2023 and 2022 was as follows:

(In Thousands)

Allowance for credit losses:

Balance -March 31, 2023

Provision (Benefit)

Balance -June 30, 2023

(In Thousands)

Allowance for loan losses:

Balance - March 31, 2022

Provision (Benefit)

Balance - June 30, 2022

(In Thousands)

Allowance for credit losses:

Balance - December 31, 2022

1 unchanged sentence

Provision (Benefit)

Balance -March 31, 2023

Balance - June 30, 2023

(In Thousands)

2 unchanged sentences

Provision (Benefit)

Balance - March 31, 2022

The Company has no individually evaluated loans at March 31, 2023, and there was no interest income recognized from individually evaluated loans as of March 31, 2023.

The following table shows our recorded investment, unpaid principal balance and allocated allowance for credit losses for loans that were considered impaired as of and for the periods presented:

As of and for the Three months Ended March 31, 2022:

Three Months Ended March 31, 2022

Balance - June 30, 2022

The Company has five individually evaluated loans, totaling $ 15.0 million, of which $ 10.6 million were market-based priced construction loans and $ 4.4 million were collateral-dependent construction loans at June 30, 2023.

Two of these loans totaling $ 4.4 million are secured by the same project located in the Bronx, New York, and are currently placed on non-accrual status.

Three of these loans totaling $ 10.6 million were subsequently sold in July 2023 with a loss of $ 159,000 charged off against the allowance for credit loss on loans.

There was no interest income recognized from non-accrual loans as of June 30, 2023.

There were no non-accrual loans at December 31, 2022.

The following table shows our recorded investment, unpaid principal balance and allocated allowance for credit losses for loans that were considered collateral dependent and impaired as of and for the periods presented:

As of and for the Three and Six Months Ended June 30, 2023 and June 30, 2022:

Three Months Ended June 30, 2023

Six Months Ended June 30, 2023

Unpaid Principal

1 unchanged sentence

Interest Income

Average Recorded

Interest Income

2023 - Collateral Dependent

(In Thousands)

7 unchanged sentences

Commercial and industrial

Three Months Ended June 30, 2022

Six Months Ended June 30, 2022

Unpaid Principal

Average Recorded

Interest Income

Average Recorded

Interest Income

2022 - Impaired

(In Thousands)

With no related allowance recorded:

Residential real estate-Multi-family

Non-residential real estate

Commercial and industrial

With an allowance recorded

Residential real estate-Multi-family

Non-residential real estate

Commercial and industrial

As of and for the Year Ended December 31, 2022:

11 unchanged sentences

Commercial and industrial

There were no non-accrual loans at March 31, 2023 and December 31, 2022, respectively.

The following tables provide information about delinquencies in our loan portfolio at the dates indicated.

Age Analysis of Past Due Loans as of March 31, 2023:

Age Analysis of Past Due Loans as of June 30, 2023:

(In Thousands)

22 unchanged sentences

Doubtful – Loans which have all of the weaknesses inherent in those classified as Substandard, with the added characteristic that the weaknesses present make collection or liquidation in full highly questionable and improbable, on the basis of currently existing facts, conditions and values.

The following table presents the risk category of loans at March 31, 2023 by loan segment and vintage year:

The following table presents the risk category of loans at June 30, 2023 by loan segment and vintage year:

Term Loans Amortized Costs Basis by Origination Year

March 31, 2023

June 30, 2023

Residential real estate

15 unchanged sentences

Special Mention

There were no non-performing loans at March 31, 2023.

The following table provides certain information related to the credit quality of our loan portfolio.

The following table provides certain information related to the credit quality of our loan portfolio at December 31, 2022.

Credit Risk Profile by Internally Assigned Grade as of December 31, 2022:

9 unchanged sentences

If the borrower continues to experience financial difficulty, another concession, such as principal forgiveness, may be granted.

There were no loans modified to borrowers experiencing financial difficulty during the three months ended March 31, 2023 or the year ended December 31, 2022.

There were no loans modified to borrowers experiencing financial difficulty during the three and six months ended June 30, 2023 or the year ended December 31, 2022.

Allowance for Credit Losses on Off-Balance Sheet Commitments:

The following table presents the activity in the allowance for credit losses related to off-balance sheet commitments, that is included in Accounts Payable and Accrued Expenses on the consolidated statement of financial condition, for the three months ended March 31, 2023:

Allowance for

3 unchanged sentences

Balance – March 31, 2023

Provision for credit loss

Balance – June 30, 2023

Note 7 — Real Estate Owned (“REO”)

The Company owned one foreclosed property valued at approximately $ 1,456,000 at March 31, 2023 and $ 1,456,000 at December 31, 2022, consisting of an office building located in Pennsylvania.

The Company owned one foreclosed property valued at approximately $ 1,456,000 at June 30, 2023 and $ 1,456,000 at December 31, 2022, consisting of an office building located in Pennsylvania.

The property was acquired through foreclosure in December 2014.

1 unchanged sentence

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 $ 21,000 and $ 31,000 for the three months ended March 31, 2023 and 2022, respectively.

REO expense recorded in the consolidated statements of income amounted to $ 21,000 and $ 21,000 for the three months, and $ 41,000 and $ 52,000 for the six months ended June 30, 2023 and 2022, respectively.

Note 8 — Federal Home Loan Bank of New York (“FHLB”) Advances

FHLB advances are summarized as follows at March 31, 2023 and December 31, 2022:

FHLB advances are summarized as follows at June 30, 2023 and December 31, 2022:

Weighted Average

7 unchanged sentences

After five years (due 2030)

At March 31, 2023, 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 March 31, 2023, 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 March 31, 2023, these unpledged qualifying mortgage loans were not pledged to any company other than the FHLB.

At March 31, 2023, the Company had the ability to borrow $ 35.5 million, net of $ 14.0 million in outstanding advances, from the FHLB and $ 8.0 million from Atlantic Community Bankers Bank (“ACBB”).

At June 30, 2023, none of the above advances were subject to early call or redemption features.

All advances had fixed interest rates, with the remaining term of nine months for one advance and seven years for the other advance.

At June 30, 2023, 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 June 30, 2023, these unpledged qualifying mortgage loans were not pledged to any company other than the FHLB.

At June 30, 2023, the Company had the ability to borrow $ 32.6 million, net of $ 14.0 million in outstanding advances, from the FHLB and $ 8.0 million from Atlantic Community Bankers Bank (“ACBB”).

Note 9 — Benefits Plans

1 unchanged sentence

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 March 31, 2023 and 2022:

Three Months Ended March 31,

The following table sets forth information regarding the components of net pension periodic expense measured as of June 30, 2023 and 2022:

Three Months Ended June 30,

Six Months Ended June 30,

(Dollars In Thousands)

Net periodic pension expense:

2 unchanged sentences

Total net periodic pension expense included in other non-interest expenses

Unrecognized net loss of $ 18,000 and $ 17,000 for the three months ended March 31, 2023 and 2022, respectively, were included in accumulated other comprehensive income.

Unrecognized net loss of $ 18,000 and $ 7,000 for the three months, and $ 36,000 and $ 14,000 for the six months ended June 30, 2023 and 2022, respectively, were included in accumulated other comprehensive income.

Supplemental Executive Retirement Plan (“SERP”)

5 unchanged sentences

No benefits are expected to be paid during the next five years .

Expenses of $ 60,000 and $ 119,000 for the three months, respectively, were recorded for this plan and are reflected in the Consolidated Statements of Income under Salaries and Employee Benefits.

Expenses of $ 51,000 and $ 121,000 for the three months, and $ 111,000 and $ 240,000 for the six months ended June 30, 2023 and 2022, 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 March 31, 2023, the Company did not have any obligations under the plan.

At June 30, 2023, the Company did not have any obligations under the 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 months ended March 31, 2023 and 2022.

The Company provided no matching contribution during the three and six months ended June 30, 2023 and 2022.

Employee Stock Ownership Plan (“ESOP”)

6 unchanged sentences

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 $ 1,327,000 at March 31, 2023 and December 31, 2022.

The balance remaining on the second ESOP loan was $ 6,850,000 at March 31, 2023 and December 31, 2022.

The balance remaining on the first ESOP loan was $ 1,327,000 at June 30, 2023 and December 31, 2022.

The balance remaining on the second ESOP loan was $ 6,850,000 at June 30, 2023 and December 31, 2022.

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.

4 unchanged sentences

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 $ 326,000 and $ 258,000 for the three months ended March 31, 2023 and 2022, respectively.

Dividends on unallocated shares, which totaled approximately $ 47,000 and $ 52,000 for the three months ended March 31, 2023 and 2022, are recorded as a reduction of the ESOP loan.

Dividends on allocated shares, which totaled approximately $ 42,000 and $ 36,000 for the three months ended March 31, 2023 and 2022, respectively, are charged to retained earnings.

ESOP expense totaled approximately $ 294,000 and $ 246,000 for the three months, and $ 620,000 and $ 504,000 for the six months ended June 30, 2023 and 2022, respectively.

Dividends on unallocated shares, which totaled approximately $ 47,000 and $ 209,000 for the three months, and $ 94,000 and $ 261,000 for the six months ended June 30, 2023 and 2022, are recorded as a reduction of the ESOP loan.

Dividends on allocated shares, which totaled approximately $ 42,000 and $ 146,000 for the three months, and $ 83,000 and $ 182,000 for the six months ended June 30, 2023 and 2022, respectively, are charged to retained earnings.

ESOP shares are summarized as follows:

20 unchanged sentences

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 March 31, 2023 and December 31, 2022, the quantitative data relating to the Company’s leases are as follows (in thousands):

At June 30, 2023 and December 31, 2022, the quantitative data relating to the Company’s leases are as follows (in thousands):

Finance Lease Amounts:

9 unchanged sentences

The components of lease expense and cash flow information related to leases as follows:

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(Dollars In Thousands)

Finance Lease Cost

5 unchanged sentences

Operating leases

Maturities of lease liabilities at March 31, 2023 are as follows (in thousands):

Maturities of lease liabilities at June 30, 2023 are as follows (in thousands):

Years ended December 31:

12 unchanged sentences

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 March 31, 2023 and December 31, 2022:

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 June 30, 2023 and December 31, 2022:

Quoted Prices in

6 unchanged sentences

Mortgage-backed securities

There were no transfers between Level 1 and 2 during the three months ended March 31, 2023 or the year ended December 31, 2022.

The Company did no t have any liabilities that were carried at fair value on a recurring basis at March 31, 2023 and December 31, 2022.

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 March 31, 2023 and December 31:

There were no transfers between Level 1 and 2 during the three and six months ended June 30, 2023 or the year ended December 31, 2022.

The Company did no t have any liabilities that were carried at fair value on a recurring basis at June 30, 2023 and December 31, 2022.

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 June 30, 2023 and December 31, 2022:

Quoted Prices in

7 unchanged sentences

Real estate owned

The Company did not have any assets that were carried at fair value on a non-recurring basis at March 31, 2023.

The following tables present the qualitative information about non-recurring Level 3 fair value measurements of financial instruments at December 31, 2022:

The following tables present the qualitative information about non-recurring Level 3 fair value measurements of financial instruments at June 30, 2023 and December 31, 2022:

At June 30, 2023

(In Thousands)

Loans individually evaluated

Income approach

Capitalization rate

Real estate owned

Income approach

Capitalization rate

At December 31, 2022

6 unchanged sentences

Capitalization rate

The Company did no t have any liabilities that were carried at fair value on a non-recurring basis at March 31, 2023 and December 31, 2022.

The methods and assumptions used to estimate fair value at March 31, 2023 and December 31, 2022 are as follows:

The Company did no t have any liabilities that were carried at fair value on a non-recurring basis at June 30, 2023 and December 31, 2022.

The methods and assumptions used to estimate fair value at June 30, 2023 and December 31, 2022 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.

15 unchanged sentences

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 March 31, 2023 and December 31, 2022:

The following methods and assumptions were used to estimate the fair values of the Company’s financial instruments at June 30, 2023 and December 31, 2022:

Fair values for marketable equity securities are determined by quoted market prices on nationally recognized and foreign securities exchanges (Level 1).

5 unchanged sentences

Fair Value at

March 31, 2023

June 30, 2023

(In thousands)

29 unchanged sentences

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).

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.

A contract 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.

1 unchanged sentence

The Company does not typically enter into long-term revenue contracts with customers, and therefore, does not experience significant contract balances.

As of March 31, 2023, the Company did not have any significant contract balances.

As of June 30, 2023, 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 months ended March 31, 2023 and 2022.

The following table presents the Company’s sources of noninterest income for the three and six months ended June 30, 2023 and 2022.

Sources of revenue outside the scope of ASC 606 are noted as such:

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(In Thousands)

Non-interest income:

2 unchanged sentences

Electronic banking fees and charges

Gain on disposition of equipment (1)

Income from bank owned life insurance (1)

Investment advisory fees

Unrealized loss on equity securities (1)

Unrealized gain (loss) on equity securities (1)

Miscellaneous (1)

18 unchanged sentences

The following is an analysis of other non-interest expenses:

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(In Thousands)

Service contracts

12 unchanged sentences

The following table sets forth the computations of basic and diluted earnings per share:

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(In Thousands, except per share data)

Net income (basic and diluted)

4 unchanged sentences

Dilutive effect of restricted stock

Dilutive effect of stock option

Diluted weighted average shares outstanding

6 unchanged sentences

Management recognizes compensation expense for the fair value of restricted stock on a straight-line basis over the requisite service period for the entire award.

As of March 31, 2023 and December 31, 2022, there were 137,637 shares available for future awards under this plan, which includes 98,311 shares available for stock options and 39,326 shares available for restricted stock awards.

A summary of the Company’s restricted stock activity and related information for the three months ended March 31, 2023 follows:

As of June 30, 2023 and December 31, 2022, there were 137,637 shares available for future awards under this plan, which includes 98,311 shares available for stock options and 39,326 shares available for restricted stock awards.

A summary of the Company’s restricted stock activity and related information for the three and six months ended June 30, 2023 follows:

Weighted Average

1 unchanged sentence

Outstanding at March 31, 2023

Compensation expense related to restricted stock was $ 241,000 for the three months ended March 31, 2023.

At March 31, 2023 and December 31, 2022, the total compensation cost related to non-vested awards that has not yet been recognized was $ 4.5 million and $ 4.7 million, respectively, which is expected to be recognized over the next 5 years .

A summary of the Company’s stock option activity and related information for the three months ended March 31, 2023 follows:

Outstanding at June 30, 2023

Compensation expense related to restricted stock was $ 241,000 and $ 482,000 for the three and six months ended June 30, 2023.

At June 30, 2023 and December 31, 2022, the total compensation cost related to non-vested awards that has not yet been recognized was $ 4.0 million and $ 4.7 million, respectively, which is expected to be recognized over the next 5 years.

A summary of the Company’s stock option activity and related information for the three and six months ended June 30, 2023 follows:

Weighted Average

2 unchanged sentences

Exercisable at March 31, 2023

Outstanding at June 30, 2023

Exercisable at June 30, 2023

Compensation cost related to stock options is recognized based on the fair value of the stock options at the grant date on a straight line basis over the vesting period.

Compensation expense related to stock options was $ 192,000 for the three months ended March 31, 2023.

At March 31, 2023 and December 31, 2022, unrecognized compensation cost related to stock option awards was $ 3.6 million and $ 3.7 million, respectively, which is expected to be recognized over the next 5 years .

Compensation expense related to stock options was $ 192,000 and $ 384,000 for the three and six months ended June 30, 2023.

At June 30, 2023 and December 31, 2022, unrecognized compensation cost related to stock option awards was $ 3.2 million and $ 3.7 million, respectively, which is expected to be recognized over the next 5 years.

Note 16 — Recent Accounting Pronouncements

There is no Accounting Standards pending adoption at March 31, 2023.

There is no Accounting Standards pending adoption at June 30, 2023.

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

What changed 10-Q

Item 1. Financial Statements