Financial Performance - Net income for the three months ended December 31, 2025, was $1.2 million, up from $951,000 in the same period in 2024, representing a year-over-year increase of 26.1%[121] - For the nine months ended December 31, 2025, net income was $3.0 million, compared to $2.8 million for the same period in 2024, indicating a growth of 7.1%[121] - Non-interest income increased by $48,000, or 7.3%, to $704,000 for the three months ended December 31, 2025, primarily due to a 52.4% increase in gains on sale of loans, which rose to $96,000 from $63,000[139] - The company recorded a total non-interest income of $2.0 million for the nine months ended December 31, 2025, reflecting a 7.7% increase compared to $1.9 million for the same period in 2024[140] Asset and Liability Management - Total assets increased by $27.0 million, or 5.3%, to $535.7 million at December 31, 2025, compared to $508.7 million at March 31, 2025, primarily due to a $28.0 million, or 7.0%, increase in gross loans[104] - Gross loans rose by $28.0 million, or 7.0%, to $430.2 million at December 31, 2025, with the largest increase in commercial non-real estate loans, which grew by $12.8 million, or 40.1%[107] - Total deposits increased by $23.8 million, or 5.7%, to $440.0 million at December 31, 2025, reflecting customer confidence and the strength of the core deposit base[109] - Stockholders' equity increased by $4.4 million, or 5.3%, to $87.7 million at December 31, 2025, driven by net income of $3.0 million and a $1.2 million decrease in unrealized losses on securities valuations[112] - Cash and cash equivalents decreased by $574,000, or 2.0%, to $28.1 million at December 31, 2025, primarily due to increased loan funding[105] - Investment securities available-for-sale decreased by $480,000, or 0.8%, to $58.9 million at December 31, 2025, with net unrealized losses decreasing by $1.5 million[106] - Noninterest-bearing deposits decreased by $2.5 million, or 3.9%, to $62.0 million, while certificates of deposit increased by $25.8 million, or 21.1%, to $148.6 million[110] - The company had no outstanding borrowings at December 31, 2025, and March 31, 2025, relying on deposit growth to fund operations[111] Income and Expense Analysis - Interest and dividend income increased by $924,000, or 14.8%, to $7.2 million for the three months ended December 31, 2025, compared to $6.2 million for the same period in 2024[122] - Interest income on loans rose by $926,000, or 16.4%, to $6.6 million for the three months ended December 31, 2025, with an average loan balance increase of $26.0 million, or 6.5%[123] - The net interest income before provision for credit losses increased by $723,000, or 17.5%, to $4.9 million for the three months ended December 31, 2025, compared to $4.1 million for the same period in 2024[133] - Non-interest expense increased by $544,000, or 15.4%, to $4.1 million for the three months ended December 31, 2025, with salaries and employee benefits rising by 15.1% to $2.2 million[143] - Non-interest expense for the nine months ended December 31, 2025, increased by $1.5 million, or 14.5%, to $12.1 million, with salaries and employee benefits rising by 14.2% to $6.5 million[144] Interest Rate and Margin Analysis - The interest rate spread increased by 46 basis points to 3.24% for the three months ended December 31, 2025, compared to 2.78% for the same period in 2024[134] - The net interest margin increased by 43 basis points to 3.98% for the three months ended December 31, 2025, compared to 3.55% for the same period in 2024[134] - Total interest-earning assets increased to $487.4 million for the three months ended December 31, 2025, from $465.3 million in the same period in 2024, reflecting a growth of 4.8%[1] - Total interest-bearing liabilities rose to $350.5 million for the three months ended December 31, 2025, compared to $327.2 million for the same period in 2024, an increase of 7.1%[1] - Interest expense increased by $201,000, or 9.5%, to $2.3 million for the three months ended December 31, 2025, compared to $2.1 million for the same period in 2024[128] Cash Flow Analysis - For the nine months ended December 31, 2025, net cash provided by operating activities amounted to $3.3 million, primarily due to net income of $3.0 million[164] - Net cash used in investing activities for the same period was $27.0 million, primarily due to a net increase in loans of $28.0 million[164] - Cash flows from financing activities for the nine months ended December 31, 2025, resulted in a net increase of $23.0 million, primarily due to an increase in deposits of $23.8 million[164] - The Association had a net decrease in cash and cash equivalents of $574,000 for the nine months ended December 31, 2025[163] Future Projections and Economic Impact - Net interest income (NII) is projected to increase by 1.11% with a gradual 200 basis point increase in market interest rates, while a decrease of the same magnitude would result in a 1.37% decrease in NII[153] - The market value of equity (MVE) is estimated to increase by 7.38% with an instantaneous 200 basis point increase in market interest rates, while a decrease of the same magnitude would lead to a 12.79% decrease in MVE[158] - The company plans to continue evaluating the estimated future credit loss impact based on credit quality and macroeconomic forecasts[137] - The primary impact of inflation on operations is reflected in increased operating costs, with interest rates having a more significant impact on performance[168] Loan and Borrowing Information - The Association's commercial real estate loans generally have terms and amortization periods up to 20 years, with loan-to-value ratios limited to 75%[169] - The debt service coverage ratio for commercial real estate loans is generally at least 1.20x[171] - As of December 31, 2025, the Association had remaining availability for FHLB and FRB borrowings of approximately $57.0 million[161] - The company has not engaged in hedging activities and does not anticipate entering into similar transactions in the future[149]

Financial Position - Total assets increased by $1.3 million, or 0.3%, to $510.0 million at September 30, 2025, compared to $508.7 million at March 31, 2025 [104]. - Stockholders' equity increased by $2.9 million, or 3.4%, to $86.2 million at September 30, 2025, primarily due to net income of $1.9 million and a decrease in unrealized losses on securities [112]. - Total deposits decreased by $8.0 million, or 1.9%, to $408.2 million at September 30, 2025, mainly driven by funds leaving the Association held in a 1031 exchange [109]. - Cash and cash equivalents decreased by $19.8 million, or 69.0%, to $8.9 million at September 30, 2025, primarily due to increased loan funding and a reduction in total deposits [105]. - Outstanding borrowings increased to $8.5 million at September 30, 2025, compared to no borrowings at March 31, 2025 [111]. Loan Performance - Gross loans increased by $20.1 million, or 5.0%, to $422.3 million at September 30, 2025, driven by increases in all loan categories except land development and residential real estate [107]. - Interest income on loans rose by $592,000, or 10.6%, to $6.2 million for the three months ended September 30, 2025, with an average loan balance increase of $21.0 million, or 5.4% [123]. - The company targets new commercial real estate loan originations to experienced small- and mid-size owners and investors, with loan-to-value ratios generally limited to 75% [165]. - The debt service coverage ratio for commercial real estate loans is generally at least 1.20x, ensuring borrowers can meet their debt obligations [168]. - The company evaluates borrower qualifications based on credit history, profitability, and expertise, as well as the value and condition of the property securing the loan [166]. Income and Expenses - Net income for the three months ended September 30, 2025, was $882,000, a decrease from $952,000 in the same period in 2024 [121]. - Non-interest income increased by $55,000, or 8.8%, to $679,000 for the three months ended September 30, 2025, compared to $624,000 for the same period in 2024, primarily driven by gains on sale of loans which rose by $55,000, or 127.9% [136]. - Non-interest expense increased by $539,000, or 15.3%, to $4.1 million for the three months ended September 30, 2025, compared to $3.5 million for the same period in 2024, with salaries and employee benefits rising by $256,000, or 13.2% [140]. - For the six months ended September 30, 2025, non-interest expense increased by $985,000, or 14.1%, to $8.0 million compared to $7.0 million for the same period in 2024, with salaries and employee benefits rising by $516,000, or 13.6% [141]. Interest Income and Expense - Interest and dividend income increased by $636,000, or 10.3%, to $6.8 million for the three months ended September 30, 2025, compared to $6.1 million for the same period in 2024 [122]. - Net interest income before provision for credit losses increased by $527,000, or 13.0%, to $4.6 million for the three months ended September 30, 2025, compared to $4.1 million for the same period in 2024 [131]. - Interest expense increased by $109,000, or 5.2%, to $2.2 million for the three months ended September 30, 2025, compared to $2.1 million for the same period in 2024 [127]. - The net interest margin increased by 28 basis points to 3.85% for the three months ended September 30, 2025, compared to 3.57% for the same period in 2024 [132]. - The interest rate spread increased by 35 basis points to 3.13% for the three months ended September 30, 2025, compared to 2.78% for the same period in 2024 [132]. Cash Flow - For the six months ended September 30, 2025, the net cash provided by operating activities was $1.0 million, with a net income of $1.9 million [160]. - Cash flows from investing activities resulted in a net outflow of $20.2 million, primarily due to a net increase in loans of $20.1 million [160]. - Cash flows from financing activities showed a net outflow of $584,000, mainly due to a decrease in deposits of $8.0 million [160]. - For the six months ended September 30, 2024, cash flows from operating activities provided $1.7 million, while cash used in investing activities was $19.0 million [161]. - The company experienced a net decrease in cash and cash equivalents of $19.8 million for the six months ended September 30, 2025 [159]. Market and Risk Management - The company has not engaged in hedging activities and does not anticipate entering into similar transactions in the future, focusing instead on managing interest rate risk through asset/liability management strategies [145]. - At September 30, 2025, a gradual 200 basis point increase in market interest rates would result in a 0.17% decrease in net interest income (NII) [149]. - The estimated changes in market value of equity (MVE) indicate a 3.23% increase in MVE with a 200 basis point increase in market interest rates and a 10.07% decrease with a 200 basis point decrease [154]. - The primary impact of inflation on operations is reflected in increased operating costs, with interest rates having a more significant effect on performance [164]. - The company had remaining availability for FHLB borrowings of approximately $32.0 million at September 30, 2025, with the ability to significantly increase borrowing capacity if additional assets are pledged [157].

Financial Position - Total assets decreased by $7.8 million, or 1.5%, to $500.9 million at June 30, 2025, from $508.7 million at March 31, 2025[97]. - Cash and cash equivalents decreased by $20.8 million, or 72.4%, to $7.9 million at June 30, 2025, primarily due to increased loan funding and decreased total deposits[98]. - Total deposits decreased by $15.6 million, or 3.7%, to $400.6 million at June 30, 2025, primarily due to funds leaving the Association held in a 1031 exchange[102]. - Outstanding borrowings increased to $8.5 million at June 30, 2025, from no outstanding borrowings at March 31, 2025[104]. - Stockholders' equity increased by $1.3 million, or 1.6%, to $84.6 million at June 30, 2025, driven by net income of $988,000 and a decrease in unrealized losses on securities[105]. Loan and Investment Activity - Gross loans increased by $11.0 million, or 2.7%, to $413.2 million at June 30, 2025, driven by increases across all loan categories except for land development and SIDs[100]. - Investment securities available for sale increased by $1.7 million, or 2.9%, to $61.1 million at June 30, 2025, with purchases of $3.4 million during the period[99]. - Interest income on loans increased by $591,000, or 11.1%, to $5.9 million, with the average balance of loans growing by $25.2 million, or 6.7%, to $403.6 million[113]. - The company targets new commercial real estate loan originations to experienced small- and mid-sized owners and investors, focusing on properties within its primary market area[148][150]. Income and Expenses - Net income for the three months ended June 30, 2025, was $988,000, an increase of 9.4% from $903,000 in the same period of 2024[111]. - Interest and dividend income rose by $670,000, or 11.3%, to $6.6 million for the three months ended June 30, 2025, compared to $5.9 million in 2024[112]. - Net interest income before provision for credit losses increased by $523,000, or 13.2%, to $4.5 million for the three months ended June 30, 2025[117]. - Non-interest income increased by $42,000, or 6.9%, to $654,000, driven by a 60.4% increase in gain on sale of loans to $77,000[122]. - Total non-interest expense rose by $446,000, or 12.8%, to $3.9 million, with salaries and employee benefits increasing by $260,000 due to the implementation of the 2024 Equity Incentive Plan[124][125]. Tax and Interest Rates - The effective income tax rate for the three months ended June 30, 2025, was 19.6%, compared to 18.7% in 2024[126]. - The interest rate spread increased by 28 basis points to 3.05%, and the net interest margin increased by 22 basis points to 3.75% for the three months ended June 30, 2025[118]. - The company recorded a reversal of provision for credit losses of $3,000 for the three months ended June 30, 2025, compared to a provision of $5,000 in 2024[119]. - The average interest-earning assets to interest-bearing liabilities ratio was 140.53% for the three months ended June 30, 2025, compared to 144.45% in 2024[118]. - As of June 30, 2025, a 200 basis point increase in market interest rates would result in a 0.50% decrease in Net Interest Income (NII) while a 200 basis point decrease would lead to a 0.69% increase in NII[133]. Market Value and Borrowing Capacity - The estimated changes in Market Value of Equity (MVE) indicate a decrease of $987,000 (0.88%) with a 400 basis point increase in interest rates and a decrease of $17.8 million (15.81%) with a 200 basis point decrease[136][138]. - The MVE ratio is projected to decrease to 13.69% with a 400 basis point decrease in interest rates, compared to a base ratio of 23.38%[136]. - The Association had approximately $32.5 million available for Federal Home Loan Bank (FHLB) borrowings as of June 30, 2025, with the potential to increase borrowing capacity by pledging additional assets[142]. Cash Flow and Operating Activities - For the three months ended June 30, 2025, net cash used in operating activities was $96,000, with net income of $1.0 million and a decrease in cash and cash equivalents of $20.8 million[145]. - Cash flows from investing activities resulted in a net outflow of $13.0 million, primarily due to an increase in loans of $11.0 million and the purchase of investment securities of $3.4 million[145]. - The company experienced a decrease in deposits of $15.6 million during financing activities, partially offset by $8.0 million from short-term FHLB advances[145]. Economic Impact - The impact of inflation on the company's operations is primarily reflected in increased operating costs, with interest rates having a more significant effect on performance than inflation[147]. - The debt service coverage ratio for commercial real estate loans is generally maintained at a minimum of 1.20x, ensuring borrower financial stability[151].

Financial Performance - Net income decreased by $105,000, or 2.8%, to $3.7 million for the year ended March 31, 2025, compared to $3.8 million for the year ended March 31, 2024[315]. - Interest income increased by $3.7 million, or 17.8%, to $24.7 million for the year ended March 31, 2025, from $21.0 million for the year ended March 31, 2024[316]. - Interest income on loans increased by $3.2 million, or 17.3%, to $22.2 million for the year ended March 31, 2025, from $19.0 million for the year ended March 31, 2024[317]. - Net interest income increased by $1.9 million, or 13.2%, to $16.3 million for the year ended March 31, 2025, compared to $14.4 million for the year ended March 31, 2024[322]. - Non-interest income decreased by $243,000, or 8.5%, to $2.6 million for the year ended March 31, 2025, compared to $2.9 million for the year ended March 31, 2024[325]. - Non-interest expense increased by $1.8 million, or 14.1%, to $14.4 million for the year ended March 31, 2025, from $12.6 million for the year ended March 31, 2024[326]. - Income tax expense decreased by $8,000, or 0.9%, to $869,000 for the year ended March 31, 2025, with an effective tax rate of 19.2%[327]. Asset and Liability Management - Total assets increased by $45.4 million, or 9.8%, to $508.7 million at March 31, 2025, from $463.3 million at March 31, 2024[301]. - Cash and cash equivalents rose by $17.2 million, or 150.4%, to $28.7 million at March 31, 2025, primarily due to principal payments on securities and increased deposits[302]. - Gross loans held for investment increased by $22.0 million, or 5.8%, to $402.2 million at March 31, 2025, with agriculture loans seeing a significant rise of $23.1 million, or 117.5%[304]. - Total deposits grew by $41.1 million, or 10.9%, to $416.2 million at March 31, 2025, driven by increases in various account types[305]. - Total equity increased by $5.0 million, or 6.5%, to $83.3 million at March 31, 2025, attributed to net income of $3.7 million and other comprehensive income of $1.4 million[308]. - Non-interest bearing deposits decreased by $2.4 million, or 3.6%, to $64.5 million at March 31, 2025, as customers sought higher-yield deposits[306]. - The company had no borrowings at March 31, 2025, relying on increased deposits to fund operations[307]. Interest Rate and Credit Risk - The weighted average expected long-term rate of return on plan assets is anticipated to be 5.25% in 2025, down from 5.40% in 2024[298]. - The discount rate utilized for pension obligations was 5.55% in 2025, determined by matching anticipated cash flows to a high-quality corporate bond index[297]. - Provision for credit losses recorded was $200,000 for the year ended March 31, 2025, compared to $88,000 for the year ended March 31, 2024[323]. - The allowance for credit losses was $5.4 million at March 31, 2025, compared to $5.9 million at March 31, 2024[323]. - The average cost of deposits increased by 32 basis points to 2.56% for the year ended March 31, 2025, from 2.24% for the year ended March 31, 2024[320]. Cash Flow and Commitments - Cash flows from operating activities for the year ended March 31, 2025, amounted to $4.5 million, primarily due to net income of $3.7 million[346]. - At March 31, 2025, the Association had $45.0 million of unfunded loan commitments, with $12.8 million for construction loans in process[350]. - The Association had remaining availability for Federal Home Loan Bank borrowings of approximately $40.5 million at March 31, 2025[342]. - The Company anticipates sufficient funds to meet current funding commitments and expects a significant portion of maturing time deposits to be retained[348]. Regulatory and Accounting Updates - The amendments in the update regarding segment expenses are effective for fiscal years beginning after December 15, 2023, with early adoption permitted[356]. - Public business entities must disclose specific categories in the rate reconciliation for income taxes, with reconciling items meeting a threshold of 5% of pretax income[357]. - The company will adopt the ASU for the reporting period beginning April 1, 2025, and does not expect a material impact on consolidated financial statements[357]. Commercial Real Estate Loans - The commercial real estate loans have terms and amortization periods up to 20 years, with loan-to-value ratios generally limited to 75%[358]. - The debt service coverage ratio for commercial real estate loans is generally at least 1.20x[359]. - A significant majority of commercial real estate loans are appraised by outside independent appraisers approved by the board of directors[360]. - Personal guarantees are generally obtained from the principals of commercial real estate borrowers[360]. - The company targets new commercial real estate loan originations to experienced, growing small- and mid-size owners and investors[358]. - The interest rate on commercial real estate loans is fixed for the initial term (five years or less) and then adjusts at the end of the next period[358]. - The company evaluates the qualifications and financial condition of the borrower, including credit history and profitability[359].

Financial Position - Total assets increased by $21.0 million, or 4.5%, to $484.3 million at December 31, 2024, from $463.3 million at March 31, 2024, primarily due to a $24.6 million, or 6.6%, increase in net loans [110]. - Cash and cash equivalents decreased by $4.9 million, or 42.0%, to $6.6 million at December 31, 2024, from $11.5 million at March 31, 2024, mainly due to increased loan funding and construction of new branch locations [111]. - Loans increased by $24.7 million, or 6.5%, to $404.9 million at December 31, 2024, driven by a significant increase in agriculture loans, which rose by $24.4 million, or 123.9% [113]. - Total deposits rose by $19.2 million, or 5.1%, to $394.3 million at December 31, 2024, primarily due to higher balances in time deposits and money market accounts [115]. - Stockholders' equity increased by $3.0 million, or 3.8%, to $81.3 million at December 31, 2024, driven by net income of $2.8 million and a decrease in unrealized losses on securities [118]. - Premises and equipment increased by $4.4 million, or 75.1%, to $10.3 million at December 31, 2024, due to the construction of two new branch offices [114]. - The company had no outstanding borrowings at December 31, 2024, and March 31, 2024, utilizing increased deposits to fund operations [117]. Income and Expenses - For the three months ended December 31, 2024, net income was $951,000, a slight increase from $937,000 for the same period in 2023 [126]. - Interest and dividend income rose by $805,000, or 14.8%, to $6.2 million for the three months ended December 31, 2024, compared to $5.4 million in 2023 [127]. - Interest income on loans increased by $756,000, or 15.5%, to $5.6 million for the three months ended December 31, 2024, driven by a 7.8% increase in the average balance of loans [128]. - Interest expense increased by $421,000, or 24.9%, to $2.1 million for the three months ended December 31, 2024, due to higher costs of interest-bearing liabilities [133]. - For the nine months ended December 31, 2024, net income was $2.8 million, a decrease from $2.9 million for the same period in 2023 [126]. - Interest income on loans for the nine months ended December 31, 2024, increased by $2.8 million, or 19.9%, to $16.6 million compared to $13.8 million in 2023 [131]. - Interest expense on deposits increased by $1.5 million, or 32.4%, to $6.1 million for the nine months ended December 31, 2024, compared to $4.6 million for the same period in 2023 [136]. - Non-interest income decreased by $326,000, or 14.7%, to $1.9 million for the nine months ended December 31, 2024, from $2.2 million for the same period in 2023 [145]. - Non-interest expense increased by $1.4 million, or 15.5%, to $10.5 million for the nine months ended December 31, 2024, compared to $9.1 million for the same period in 2023 [149]. - Provision for credit losses decreased to $56,000 for the nine months ended December 31, 2024, from $99,000 for the same period in 2023 [142]. Interest Rates and Margins - The yield on loans increased by 38 basis points to 5.70% for the three months ended December 31, 2024, up from 5.32% in 2023 [128]. - The interest rate spread increased by four basis points to 2.71% for the nine months ended December 31, 2024, compared to 2.67% for the same period in 2023 [140]. - The net interest margin increased by 20 basis points to 3.53% for the nine months ended December 31, 2024, compared to 3.33% for the same period in 2023 [140]. - Interest income on securities increased by $365,000, or 29.7%, to $1.6 million for the nine months ended December 31, 2024, driven by a 74 basis point increase in the average yield [132]. Cash Flow and Liquidity - For the nine months ended December 31, 2024, net cash provided by operating activities amounted to $2.4 million, while net cash used in investing activities was $26.0 million, primarily due to a net increase in loans of $24.7 million [169]. - Cash flows from financing activities for the nine months ended December 31, 2024, amounted to $18.8 million, primarily due to an increase in deposits of $19.2 million [169]. - The net decrease in cash and cash equivalents for the nine months ended December 31, 2024, was $4.8 million, compared to a net decrease of $4.9 million for the same period in 2023 [169][170]. Risk Management - The company does not anticipate entering into hedging activities in the future, focusing instead on managing interest rate risk through asset/liability management strategies [154]. - As of December 31, 2024, a 200 basis point increase in market interest rates would result in a 0.75% decrease in MVE, while a 200 basis point decrease would lead to a 14.73% decrease in MVE [163]. - The methodologies used in measuring interest rate risk have inherent shortcomings, as they assume constant asset and liability compositions and uniform interest rate changes across the yield curve [164]. - The Association has the ability to participate in the Federal Reserve Board's Bank Term Funding Program if needed, enhancing liquidity options [166]. Loan Portfolio - The Association's commercial real estate loans generally have terms and amortization periods up to 20 years, with loan-to-value ratios limited to 75% of the purchase price or appraised value [172]. - The debt service coverage ratio for commercial real estate loans is generally at least 1.20x, indicating a strong ability to cover debt obligations [173]. - The primary impact of inflation on operations is reflected in increased operating costs, with interest rates having a more significant impact on performance than inflation [171].

Financial Position - Total assets increased by $18.7 million, or 4.0%, to $482.0 million at September 30, 2024, from $463.3 million at March 31, 2024, primarily due to a $18.8 million, or 5.0%, increase in net loans [93]. - Total deposits increased by $16.7 million, or 4.4%, to $391.8 million at September 30, 2024, driven by higher balances in time deposits and money market accounts [98]. - Stockholders' equity increased by $3.3 million, or 4.0%, to $81.6 million at September 30, 2024, primarily due to net income of $1.9 million and a decrease in unrealized losses on securities [101]. - Total liabilities increased to $408.2 million, with total equity at $59.5 million as of September 30, 2024 [106]. - The company had no outstanding borrowings at September 30, 2024, and March 31, 2024, relying on increased deposits to fund operations [100]. Loan Performance - Net loans rose by $18.8 million, or 5.0%, to $399.1 million at September 30, 2024, with agriculture loans increasing by $16.7 million, or 84.8% [96]. - The average yield on loans increased to 5.76% for the three months ended September 30, 2024, compared to 5.13% for the same period in 2023 [102]. - Interest income on loans rose by $1.0 million, or 21.9%, to $5.6 million in Q3 2024, with an average loan balance increase of $31.0 million, or 8.7%, to $388.9 million [110]. - The yield on loans increased by 63 basis points to 5.76% in Q3 2024 from 5.13% in Q3 2023 due to rising market interest rates [110]. Income and Expenses - Net income for Q3 2024 was $952,000, slightly down from $973,000 in Q3 2023, while net income for the first half of 2024 remained stable at $1.9 million [108]. - Interest and dividend income increased by $1.1 million, or 22.2%, to $6.1 million in Q3 2024 compared to $5.0 million in Q3 2023, primarily driven by higher interest income on loans [109]. - Interest expense increased by $540,000, or 34.8%, to $2.1 million in Q3 2024, attributed to higher costs of interest-bearing liabilities [115]. - Non-interest income decreased by $57,000, or 8.4%, to $624,000 for the three months ended September 30, 2024, from $681,000 for the same period in 2023 [126]. - Non-interest expense increased by $530,000, or 17.7%, to $3.5 million for the three months ended September 30, 2024, from $3.0 million for the same period in 2023 [130]. Interest Margin and Rates - Net interest income before provision for credit losses increased by $576,000, or 16.5%, to $4.1 million in Q3 2024 compared to $3.5 million in Q3 2023 [119]. - The net interest margin improved by 25 basis points to 3.57% in Q3 2024 from 3.32% in Q3 2023 [120]. - The interest rate spread increased by 2 basis points to 2.77% for the six months ended September 30, 2024, compared to 2.75% for the same period in 2023 [122]. - The net interest margin increased by 29 basis points to 3.55% for the six months ended September 30, 2024, compared to 3.26% for the same period in 2023 [122]. Cash Flow and Liquidity - For the six months ended September 30, 2024, net cash provided by operating activities was $1.7 million, primarily due to net income of $1.9 million, while net cash used in investing activities amounted to $19.0 million [151]. - The company experienced a net decrease in cash and cash equivalents of $1.6 million for the six months ended September 30, 2024 [151]. - The company’s liquidity is primarily sourced from deposits, principal and interest payments on loans and securities, and proceeds from maturities of securities [148]. - Changes in market interest rates significantly influence deposit flows and loan prepayments, impacting liquidity [149]. Market Sensitivity - The estimated net interest income (NII) would decrease by 0.64% with a gradual, one-year 200 basis point increase in market interest rates [140]. - The market value of equity (MVE) would decrease by 20.51% with a 200 basis point increase in interest rates, resulting in an MVE of $75.668 million [144]. - As of September 30, 2024, a 200 basis point increase in market interest rates would result in a 1.13% increase in Market Value of Equity (MVE), while a 200 basis point decrease would lead to a 20.51% decrease in MVE [145]. Operational Changes - Premises and equipment increased by $2.4 million, or 40.7%, to $8.3 million at September 30, 2024, due to the construction of two new branch offices [97]. - Salaries and employee benefits expense increased by $314,000, or 19.3%, to $1.9 million for the three months ended September 30, 2024, due to additional lenders hired [130]. - The Association had remaining availability for Federal Home Loan Bank (FHLB) borrowings of approximately $40.6 million as of September 30, 2024 [148]. - The company has the capacity to borrow $5.0 million from a private bankers' bank as of September 30, 2024 [148].

Financial Position - Total assets increased by $3.3 million, or 0.7%, to $466.6 million at June 30, 2024, from $463.3 million at March 31, 2024, primarily driven by a $9.3 million, or 2.5%, increase in net loans [78]. - Net loans rose by $9.3 million, or 2.5%, to $383.7 million at June 30, 2024, with residential real estate loans increasing by $5.5 million, or 3.7% [80]. - Total deposits increased by $1.6 million, or 0.4%, to $376.7 million at June 30, 2024, with non-interest-bearing deposits rising by $1.5 million, or 2.3% [81]. - Stockholders' equity increased by $922,000, or 1.2%, to $79.2 million at June 30, 2024, driven by net income of $903,000 [82]. - Cash and cash equivalents decreased by $6.0 million, or 51.9%, to $5.5 million at June 30, 2024, due to increased loan funding [79]. - Investment securities available for sale decreased by $215,000, or 0.4%, to $60.1 million at June 30, 2024 [79]. Income and Expenses - Net income decreased by $43,000, or 4.5%, to $903,000 for the three months ended June 30, 2024, compared to $946,000 for the same period in 2023 [88]. - Interest and dividend income increased by $1.1 million, or 24.0%, to $5.9 million for the three months ended June 30, 2024, primarily due to an increase in interest income on loans [88]. - Interest income on loans rose by $988,000, or 22.9%, to $5.3 million for the three months ended June 30, 2024, with an average loan balance increase of $19.9 million, or 5.5% [89]. - Net interest income after provision for credit losses increased by $609,000, or 18.1%, to $4.0 million for the three months ended June 30, 2024 [91]. - Non-interest income decreased by $40,000, or 6.1%, to $612,000 for the three months ended June 30, 2024, with servicing fees on loans dropping by $54,000, or 62.8% [96]. - Total non-interest expense increased by $637,000, or 22.5%, to $3.5 million for the three months ended June 30, 2024, driven by higher salaries and employee benefits [97]. - Salaries and employee benefits expense increased by $279,000, or 17.8%, to $1.8 million for the three months ended June 30, 2024 [97]. Interest Rates and Margins - The average yield on loans increased to 5.61% for the three months ended June 30, 2024, compared to 4.82% for the same period in 2023 [84]. - The interest rate spread increased by seven basis points to 2.77% for the three months ended June 30, 2024, while the net interest margin increased by 38 basis points to 3.53% [92]. - The average cost of deposits rose by 74 basis points to 2.49% for the three months ended June 30, 2024, due to a higher interest rate environment [91]. Liquidity and Borrowings - Outstanding borrowings increased to $2.0 million at June 30, 2024, from no borrowings at March 31, 2024 [81]. - The company continues to monitor deposit balances and interest rates to maintain adequate liquidity [79]. - The Association had remaining availability for Federal Home Loan Bank (FHLB) borrowings of approximately $38.1 million as of June 30, 2024 [110]. - The company has the capacity to borrow $5.0 million from a private bankers' bank as of June 30, 2024 [110]. Cash Flow - For the three months ended June 30, 2024, net cash provided by operating activities was $505,000, primarily due to net income of $903,000 [112]. - Cash flows from investing activities resulted in a net outflow of $9.6 million, mainly due to a net increase in loans of $9.3 million [112]. - The Association's cash and cash equivalents decreased by $5.9 million for the three months ended June 30, 2024 [112]. Market Sensitivity - As of June 30, 2024, a gradual 200 basis point increase in market interest rates would result in a 1.18% decrease in Net Interest Income (NII) while a decrease of the same magnitude would lead to a 0.54% increase in NII [104]. - The estimated Market Value of Equity (MVE) would decrease by 2.04% with an instantaneous 200 basis point increase in market interest rates and by 14.37% with a decrease of the same amount [107]. - The MVE as of June 30, 2024, is $100,561,000, with a base MVE of $102,654,000 [106]. Compliance and Governance - The certifications of the Principal Executive Officer and Principal Financial Officer were completed in accordance with the Sarbanes-Oxley Act of 2002 [31.1][31.2]. - The Inline XBRL Instance Document is embedded within the Interactive Data File, indicating compliance with financial reporting standards [101.INS]. - The report was signed by the Chairman of the Board, President, and Chief Executive Officer, Steven D. Kunzman, and the Chief Financial Officer, Bradley M. Kool, on August 7, 2024 [127].

Financial Performance - The company's net income for the year ended March 31, 2024, was $3.759 million, a significant increase from $1.646 million in 2023, representing a growth of approximately 128.5%[475]. - The company reported net income of $3.759 million for the year ended March 31, 2024, compared to $1.646 million for the previous year, representing a year-over-year increase of approximately 128.5%[499]. - Total interest and dividend income increased to $20.963 million in 2024 from $16.143 million in 2023, reflecting a growth of about 29.1%[499]. - Net interest income after provision for credit losses rose to $14.385 million, up from $10.525 million, marking an increase of approximately 36.5%[499]. - Non-interest income totaled $2.853 million, compared to $2.278 million in the prior year, an increase of about 25.3%[499]. - The company experienced a net cash provided by operating activities of $5.708 million, up from $4.474 million in the previous year, representing an increase of about 27.6%[475]. Assets and Liabilities - Total assets increased to $463.278 million as of March 31, 2024, compared to $437.792 million in 2023, reflecting a growth of about 5.8%[469]. - The company reported total deposits of $375.145 million, a decrease from $390.952 million in the previous year, indicating a decline of approximately 4.0%[469]. - Cash and cash equivalents decreased to $11.454 million from $16.563 million, a decline of approximately 30.6% year-over-year[475]. - The total recorded investment in loans was $352,837,000 as of March 31, 2024, compared to $353,687,000 in the previous year, indicating a slight decrease of 0.2%[589]. - The total loans as of March 31, 2024, were $380,245,000, with an allowance for credit losses of $5,860,000[564]. Equity and Capital - The company’s total stockholders' equity rose to $78.277 million from $38.666 million, marking an increase of approximately 102.0%[469]. - Basic and diluted earnings per share for the year ended March 31, 2024, were reported at $2.19, with a weighted average of 1,717,941 shares outstanding[499]. - As of March 31, 2024, total capital to risk-weighted assets was $68,071,000, representing a ratio of 18.01%, exceeding the minimum requirement of 8.00%[608]. - The Association's Tier 1 capital to risk-weighted assets was $63,329,000, with a ratio of 16.75%, above the required 6.00%[608]. Credit Losses and Provisions - The allowance for credit losses was $5.860 million as of March 31, 2024, compared to $5.412 million in 2023, showing an increase of about 8.2%[469]. - The provision for credit losses was $88, significantly lower than the $2.877 million recorded in the previous year, indicating improved credit quality[499]. - The total allowance for loan losses as of March 31, 2024, was $5,860,000, reflecting a provision for credit losses of $299,000[539]. - The allowance for credit losses (ACL) is maintained at a level believed adequate to absorb estimated credit losses expected to occur within the existing loan portfolio[516]. Regulatory and Compliance - The company adopted a new credit loss accounting standard effective April 1, 2023, which may impact future financial reporting[463]. - The Company adopted ASC 326 effective April 1, 2023, resulting in an increase in the allowance for credit losses on loans of $299,000 and an allowance for credit losses on unfunded loan commitments of $210,000[514]. - The Association's total risk-based capital ratios must meet regulatory minimums to be considered well-capitalized, as outlined in the capital adequacy tables[630]. Expenses - The company’s total non-interest expense increased to $12.602 million from $10.840 million, reflecting a rise of approximately 16.3%[499]. - Current tax expense for the year ended March 31, 2024, was $831,000, significantly higher than $239,000 in the previous year, reflecting a growth of 248%[579]. - The income tax expense for the year ended March 31, 2024, was $877,000, up from $317,000 in the previous year, representing a rise of 176%[579]. - Depreciation expense for occupancy and equipment was $518,000 for the year ended March 31, 2024, an increase from $488,000 in 2023[599]. Loans and Credit Quality - The company reported a net change in loans of $(26.439 million) for the year, compared to $(44.607 million) in the previous year, indicating a reduction in loan origination[475]. - The total loans classified as Pass amounted to $349,095,000, while Substandard loans totaled $4,592,000[571]. - The total amount of past due loans is $178 thousand, with $850 thousand classified as nonaccrual[596]. - Nonaccrual loans at the end of the period are $537 thousand, down from $850 thousand at the beginning of the period[596]. Securities and Investments - The total fair value of securities available-for-sale as of March 31, 2024, was $60,356,000, with gross unrealized losses of $6,015,000[560]. - The total amortized cost of securities available-for-sale was $66,184,000, with gross unrealized gains of $187,000[560]. - The fair value of available-for-sale securities increased from $57.8 million in 2023 to $60.4 million in 2024[640]. - The fair value of municipal bonds was $7,180,000, with unrealized losses of $1,448,000[562]. Miscellaneous - The company completed a stock offering on October 19, 2023, selling 4,130,815 shares at $10.00 per share, generating gross proceeds of approximately $41.3 million[508]. - The Association serviced loans for others amounting to $160.9 million as of March 31, 2024, up from $149.5 million in 2023[632]. - The balance of mortgage servicing rights at the end of the period was $403,000, down from $434,000 at the beginning of the year[608].

Financial Performance - Cash and cash equivalents decreased by $4.9 million, or 29.4%, to $11.7 million at December 31, 2023, from $16.6 million at March 31, 2023[204] - Interest and dividend income increased by $1.2 million, or 28.4%, to $5.4 million for the three months ended December 31, 2023, compared to $4.2 million for the same period in 2022[212] - Interest expense increased by $833,000, or 96.7%, to $1.7 million for the three months ended December 31, 2023, compared to $861,000 for the same period in 2022[213] - Net interest income less provision for credit losses increased by $2.7 million, or 316.5%, to $3.6 million for the three months ended December 31, 2023, compared to $854,000 for the same period in 2022[214] - Total interest-earning assets averaged $431.5 million for the three months ended December 31, 2023, with an average yield of 5.04%[208] - For the nine months ended December 31, 2023, net cash provided by operating activities amounted to $4.2 million, primarily due to net income of $2.9 million[317] - The Company experienced a net decrease in cash and cash equivalents of $4.9 million during the same period[317] Loan Portfolio - Gross loans held for investment increased by $22.3 million, or 6.3%, to $376.1 million at December 31, 2023, from $353.7 million at March 31, 2023, with commercial real estate loans increasing by $21.4 million, or 20.8%[205] - The Company targets new commercial real estate loan originations to small- and midsize owners and investors, with loans secured by various property types[319] - Commercial real estate loans generally have terms and amortization periods up to 20 years, with loan-to-value ratios limited to 75%[319] - The Company aims to diversify its loan portfolio by adding more commercial-related loans, which typically have shorter maturities and/or adjustable rates[311] Equity and Liabilities - Total liabilities increased to $399.8 million as of December 31, 2023, compared to $379.8 million at March 31, 2023[210] - Total equity increased to $40.9 million as of December 31, 2023, from $37.1 million at March 31, 2023[210] Strategic Initiatives - The company is focused on entering new markets and capitalizing on growth opportunities as part of its future strategy[201] - The Company completed the sale of 4,130,815 shares of common stock at a price of $10.00 per share, resulting in net proceeds of $39.4 million after expenses of $1.9 million[302] - The Company invested $19.7 million of the net proceeds into the Association's operations and retained the remaining amount for general corporate purposes[302] Funding and Borrowing - The company had no borrowings at December 31, 2023, and has generally utilized cash from increased deposits to fund operations[206] - As of December 31, 2023, the Association had remaining availability for FHLB borrowings of approximately $40.9 million[315] - The Company has the ability to participate in the Federal Reserve Board's Bank Term Funding Program if needed[315] Market Conditions - Interest rates have a significant impact on the Company's performance, more so than inflation, due to the monetary nature of its assets and liabilities[318]

Financial Performance - Net income for the three months ended September 30, 2023, was $973 thousand, a decrease of 9.3% compared to $1,072 thousand for the same period in 2022 [22]. - Net income for the six months ended September 30, 2023, was $1,919 million, an increase from $1,747 million in the same period of 2022, representing a growth of approximately 9.8% [29]. - Net cash provided by operating activities decreased to $1,589 million from $2,928 million year-over-year, a decline of about 45.7% [29]. - Noninterest income totaled $681 thousand for the three months ended September 30, 2023, slightly down from $709 thousand in the same period last year, a decrease of 3.9% [22]. - The total comprehensive loss for the three months ended September 30, 2023, was $(6,808) thousand, compared to $(6,892) thousand for the same period in 2022, reflecting a decrease of 1.2% [203]. Assets and Liabilities - Total assets increased to $453,919 thousand as of September 30, 2023, up from $437,792 thousand as of March 31, 2023, representing a growth of 3.0% [19]. - Total liabilities increased to $415,437 thousand as of September 30, 2023, from $399,126 thousand as of March 31, 2023, an increase of 4.1% [19]. - Total deposits rose to $407,094 thousand as of September 30, 2023, compared to $390,952 thousand as of March 31, 2023, reflecting an increase of 4.0% [19]. - Cash and cash equivalents at the end of the period rose to $21,385 million, compared to $7,157 million at the end of the previous year, marking a substantial increase [29]. - The total amount of certificates of deposit was $99,939,000 as of September 30, 2023 [121]. Income and Expenses - Net interest income after provision for credit losses was $3,542 thousand for the three months ended September 30, 2023, compared to $3,352 thousand for the same period in 2022, marking an increase of 5.7% [22]. - The company reported total interest and dividend income of $5,033 thousand for the three months ended September 30, 2023, compared to $4,040 thousand for the same period in 2022, an increase of 24.6% [22]. - Interest expense on deposits increased by $2.2 million, or 316.8%, to $2.9 million for the six months ended September 30, 2023, compared to $691,000 for the same period in 2022 [157]. - Cash paid for interest surged to $2,150 million from $792 million, reflecting rising interest rates and increased borrowing costs [29]. - Service charges on deposit accounts increased by $59,000, or 18.1%, to $385,000 for the six months ended September 30, 2023, compared to $326,000 for the same period in 2022 [160]. Credit Losses and Provisions - The provision for credit losses was $(60) thousand for the three months ended September 30, 2023, compared to $168 thousand for the same period in 2022, indicating a significant reduction in credit loss provisions [22]. - The allowance for credit losses was $5.7 million at September 30, 2023, compared to $5.4 million at March 31, 2023, and $5.3 million at September 30, 2022 [159]. - The total allowance for loan losses as of September 30, 2023, is $5,657,000, reflecting a decrease of $60,000 from the previous quarter [98]. - Total impaired loans amounted to $850,000, with an unpaid principal balance of $1,120,000 and a specific allowance of $221,000 [105]. - The Association monitors credit risk by assessing borrowers' repayment capacity and the value of collateral, using a quarterly Loan Concentration Report [108]. Loans and Securities - The total loans as of September 30, 2023, were $367,027, with an allowance for credit losses of $5,657, leading to net loans of $361,415 [97]. - The total unrealized losses on available-for-sale investment securities amounted to $8,148, with a fair value of $50,078 [89]. - The fair value of available-for-sale investment securities as of September 30, 2023, was $54,654, down from $57,842 as of March 31, 2023 [191]. - The total real estate loans in construction reached $21,234 thousand, up from $5,755 thousand in 2022, indicating a significant increase of 269% [114]. - The Association is diversifying its loan portfolio by adding more commercial-related loans, which typically have shorter maturities and/or adjustable rates [165]. Capital and Ratios - The Association's total capital to risk-weighted assets ratio was 13.43% as of September 30, 2023, exceeding the minimum requirement of 8.00% [131]. - Tier 1 capital to risk-weighted assets ratio was 12.17% as of September 30, 2023, above the minimum requirement of 6.00% [131]. - The Association maintained a common equity tier 1 capital ratio of 12.17% as of September 30, 2023, surpassing the minimum requirement of 4.50% [131]. - The average cost of deposits increased by 141 basis points to 1.89% for the six months ended September 30, 2023, from 0.48% for the same period in 2022 [157]. - The carrying amount of loans, net, was $361,415 as of September 30, 2023, with an estimated fair value of $325,888 [190]. Regulatory and Compliance - The Association had no outstanding borrowings as of September 30, 2023, with remaining availability for FHLB borrowings of approximately $40,877,000 [127]. - The Association is not involved in any pending legal proceedings that would materially affect its financial condition or results of operations [171]. - The company is classified as an Emerging Growth Company, allowing it to delay the adoption of new accounting standards [209]. - Management evaluated subsequent events through November 13, 2023, and found no material events requiring further recognition or disclosure [212]. - The company plans to take advantage of the extended transition period under the JOBS Act, which may affect the comparability of its financial statements with those of public companies [216].