Financial Performance - As of December 31, 2025, the consolidated total assets of Central Valley Community Bancorp were approximately $3.69 billion[16]. - The total loans, net of deferred fees, amounted to $2.54 billion, with real estate loans making up $1.93 billion, representing 76.1% of the loan portfolio[21][23]. - As of December 31, 2025, the company had a net unrealized loss of $39,881,000 on its available-for-sale investment securities portfolio, totaling $763,324,000 or 20.7% of total assets[118]. - The allowance for credit losses on loans was 1.18% of total loans as of December 31, 2025, with a provision for credit losses of $3,754,000 for the year ended December 31, 2025[131]. - Non-performing loans and leases were 0.27% of total loans and leases as of December 31, 2025, compared to 0.28% at December 31, 2024[134]. - The allowance for credit losses as a percentage of non-performing loans and leases was 432.37% as of December 31, 2025[134]. - The company may experience a material adverse effect on its financial condition and results of operations if unable to manage liquidity and capital levels effectively[115]. - The company may need to raise additional capital in the future, and its ability to do so will depend on market conditions and financial performance[140]. - Future capital requirements may become more stringent, potentially restricting activities such as paying dividends or making acquisitions, which could negatively impact financial condition[139]. Regulatory Environment - The regulatory environment is complex, with oversight from multiple agencies including the Federal Reserve and FDIC, affecting the Company's operations and growth[35][36]. - The Company is subject to the Bank Holding Company Act of 1956 and must obtain prior approval from the Federal Reserve for acquisitions that would result in owning 5% or more of a bank's voting shares[40]. - The Bank's primary federal regulator is the FDIC, which insures deposits up to $250,000 for each deposit insurance ownership category[50]. - The Company and the Bank exceed the required minimum capital ratios for capital adequacy, with the Bank classified as a "well capitalized" institution[64]. - The Federal Reserve requires bank holding companies to eliminate or significantly reduce dividends if net income is insufficient to fund them[58]. - The Bank is eligible to accept brokered deposits without limitations due to its capital status[54]. - The company is subject to federal laws aimed at countering money laundering and terrorist financing, including the USA PATRIOT Act and the Bank Secrecy Act, which require extensive compliance measures[70]. - The company is required to comply with the California Consumer Privacy Act (CCPA), which grants consumers rights over their personal information, including the right to know, delete, and opt-out of the sale of their data[75]. - The company is subject to increased scrutiny from the Consumer Financial Protection Bureau (CFPB), which has broad authority to enforce consumer protection laws and may result in changes to pricing and practices[92]. - The company is also subject to state consumer protection laws, including those enforced by the California Department of Financial Protection and Innovation (DFPI), which has broad jurisdiction over consumer financial products[93]. Operational Risks - The company is highly dependent on its management team, and the loss of key personnel could adversely affect its strategic plan and financial condition[138]. - A failure in operational or security systems, including cyber-attacks, could disrupt business and result in significant losses[156]. - The company faces significant risks related to cybersecurity, including potential operational disruptions and reputational damage from security breaches[159]. - The risk management framework may not effectively mitigate risks, potentially leading to unexpected losses and adverse effects on financial condition[161]. - The company is exposed to risks from third-party service providers, which could lead to operational disruptions or breaches of systems[158]. - The integration of future acquisitions may pose operational risks and challenges, potentially affecting customer relationships and expected benefits[143]. Market Conditions - The agricultural economy in Central California is crucial for the company's financial performance, with recent declines in farm income and farmland prices posing risks[107]. - Inflation began to rise sharply at the end of 2021 and remained elevated through 2023, potentially impacting the ability of business customers to repay loans[108]. - Changes in interest rates can significantly affect net interest income, impacting loan origination volume and overall results of operations[120]. - The company faces significant competition in loan origination and deposit attraction, which could reduce net income and increase costs[149]. - The financial services industry is experiencing rapid technological changes, and the company may struggle to keep pace with larger competitors in implementing new technology[154]. Cybersecurity and Compliance - The company recognizes the importance of cybersecurity and has implemented a comprehensive Information Security Program to manage risks and safeguard customer data[188]. - The Information Security Officer (ISO) oversees the Information Security Program and reports to the board of directors on compliance and risk management[192]. - The company engages third-party assessors to conduct audits and risk assessments as part of its Information Security Program[194]. - The board of directors receives annual updates on the Information Security Program and its compliance with regulations[196]. - The SEC adopted final rules in July 2023 requiring disclosure of material cybersecurity incidents, with compliance required by December 2023[78]. - The company has implemented a customer information security program to comply with new cybersecurity notification requirements, which mandate reporting significant incidents within 36 hours[77]. Shareholder and Dividend Information - The company has declared quarterly cash dividends since 2000, but there is no obligation to continue this practice, and future dividends may be affected by capital management decisions[183]. - The company paid cash dividends of $0.48 per share in both 2025 and 2024[207]. - Future dividends will depend on earnings, financial condition, and capital requirements, and will be determined quarterly by the board of directors[208]. - The trading price of the company's common stock is subject to significant fluctuations due to various factors, including quarterly operating results and market conditions[182]. - As of December 31, 2025, the company had approximately 954 shareholders of record[206]. Asset Management - The company owns several full-service branch office properties in California, including locations in Clovis, Prather, Kerman, Exeter, Goleta, and Paso Robles[199]. - All properties owned by the bank are held without loans or encumbrances, and leased properties are considered favorable to the company[202]. - The company continually evaluates and remodels its offices to maintain efficiency and attractiveness[201]. - As of December 31, 2025, the company had $64.4 million in senior debt and subordinated notes outstanding through 2032, and $5.2 million in trust preferred securities due 2036[184].

Core Insights - The Wonderful Company announced the latest recipients of its Central Valley Community Grants program, awarding over $1.5 million to 43 organizations focused on various community initiatives [1][2]. Group 1: Grant Program Overview - The Wonderful Community Grants Program supports local nonprofit organizations and schools in California's Central Valley, where over 3,000 Wonderful employees reside [2][4]. - This year, the program awarded more than $1.5 million in grants, emphasizing health and wellness, education, recreation, community beautification, art, and social services [2][3]. - The Wonderful Company and its co-owners have invested over $850 million in the Central Valley over the past decade, promoting long-term social, educational, and economic progress [3][15]. Group 2: Community Impact - The program addresses challenges faced by local organizations due to rising healthcare costs, food insecurity, and reduced public funding, ensuring support for the backbone of healthy communities [4][5]. - Notable recipients include the Boys & Girls Clubs of Fresno County, which provides after-school programming for underserved youth [6][5]. - Other recipients include the Central California Food Bank, which distributes fresh produce to families facing food insecurity, and the Open Door Network, which supports domestic violence survivors [8][9]. Group 3: Funding Details - Grants can be applied for by local governments, nonprofits, schools, and faith-based organizations, with amounts up to $50,000 for one year and up to $100,000 for two years [14]. - Funding can be utilized for program development, expansion, innovation, and small-scale capital improvements [14][15]. - The Wonderful Company has a broader commitment to investing over $2.5 billion in various initiatives across the Central Valley and beyond [15].

Core Insights - The Wonderful Company announced the latest recipients of its Central Valley Community Grants program, awarding over $1.5 million to 43 organizations focused on various community initiatives [1][2]. Group 1: Philanthropic Commitment - The Wonderful Community Grants Program is designed to support local nonprofit organizations and schools in California's Central Valley, where over 3,000 Wonderful employees reside [2]. - The company and its co-owners have invested more than $850 million in the Central Valley over the past decade, promoting long-term social, educational, and economic progress [3]. Group 2: Community Challenges - Rising healthcare costs, food insecurity, and cuts in public funding are increasing pressure on local nonprofit organizations, necessitating greater support from initiatives like the Wonderful Community Grants program [4]. Group 3: Program Impact - The grants support a variety of initiatives, including health and wellness, education, recreation, community beautification, art, and social services [2]. - Specific programs funded include after-school programming for underserved youth, domestic violence support, free tax return assistance, food distribution, health equity initiatives, and provision of shoes for low-income students [5][8][9].

Financial Performance - The Company reported unaudited consolidated net income of $11.17 million, or $0.58 per diluted share for Q4 2025, compared to $6.89 million and $0.36 per diluted share in Q4 2024, representing a 62.9% increase in net income year-over-year [1]. - For the twelve months ended December 31, 2025, net income was $38,168,000, significantly up from $7,666,000 in 2024, with diluted EPS rising to $2.00 from $0.45 [11]. - Net income for Q4 2025 reached $11,170,000, a 2.7% increase compared to $10,873,000 in Q3 2025 [50]. - Basic earnings per common share for Q4 2025 was $0.59, up from $0.57 in Q3 2025, reflecting a growth of 3.5% [50]. - Return on average assets was 1.23% for Q4 2025, compared to 1.21% in Q3 2025 and 0.78% in Q4 2024 [7]. - Return on average equity was 11.03% for Q4 2025, down from 11.25% in Q3 2025 but up from 7.55% in Q4 2024 [7]. Loan and Deposit Growth - Gross loans increased by $89.7 million, or 3.66%, for the quarter ended December 31, 2025, and increased $206.6 million, or 8.85%, year-to-date [3]. - Total average loans increased by $174,097,000 to $2,482,277,000 for the quarter ended December 31, 2025, driven by organic loan growth [14]. - Total deposits rose by $19.3 million, or 0.63%, compared to the previous quarter, and increased $184.5 million, or 6.34%, year-to-date [3]. - Total average deposits rose by $209,662,000 or 7.22% to $3,114,530,000 for the quarter ended December 31, 2025, compared to $2,904,868,000 in 2024 [30]. Interest Income and Margin - The net interest margin improved to 4.24% for Q4 2025, up from 4.20% in Q3 2025 and 3.95% in Q4 2024, marking the seventh consecutive quarter of improvement [4]. - Net interest income before provision for credit losses increased by $3,725,000 or 11.63% to $35,749,000 for the fourth quarter of 2025 compared to the same period in 2024 [15]. - Net interest income was $36,087,000, with a net interest margin of 4.24% [57]. - The net interest margin improved to 4.15% in 2025 from 3.76% in 2024, indicating enhanced profitability on interest-earning assets [62]. Non-Interest Income and Expenses - Total non-interest income for Q4 2025 was $2.55 million, compared to $2.30 million in Q4 2024, reflecting a 10.7% increase [5]. - Total non-interest income for Q4 2025 was $2,547,000, a decrease from $2,966,000 in Q3 2025, reflecting a decline of 14.1% [52]. - Total non-interest expenses decreased by $4,315,000 or 4.6% to $90,386,000 for the twelve months ended December 31, 2025, primarily due to a reduction in non-recurring merger expenses [23]. Credit Quality - The provision for credit losses decreased to $515,000 in Q4 2025 from $667,000 in Q3 2025, indicating improved credit quality [3]. - The Company recorded a provision for loan losses of $599,000 for the fourth quarter of 2025, down from $971,000 in the same quarter of 2024 [32]. - The allowance for credit losses increased to $30,071,000, representing 1.18% of total loans, up from 1.11% in the previous year [34]. - The percentage of "Special mention" loans rose to 2.1% from 1.0% in the previous quarter [34]. Merger and Expansion - The Company signed a definitive merger agreement with United Security Bancshares, expected to close in Q2 2026, which will create a combined entity with approximately $5 billion in total assets [3]. - The Company announced a merger with United Security Bancshares, valued at approximately $188.7 million based on a share exchange ratio of 0.4520 shares of CWB common stock for each USB share [36][37]. - The merger will expand the Company's presence with full-service branches in five additional counties in Central California [36]. Capital and Assets - Total assets increased by $168,546,000 or 4.79% to $3,646,566,000 as of December 31, 2025, compared to the previous year [25]. - Total equity increased to $409,588,000 from $397,576,000 in the prior quarter [54]. - Shareholders' equity rose to $384,828,000 in 2025, compared to $317,142,000 in 2024, representing an increase of approximately 21.3% [60]. - The Company continues to maintain adequate capital levels and is well-capitalized [35].

Financial Performance - Net income for the three months ended September 30, 2025, was $10,873 thousand, a significant increase of 220.5% compared to $3,385 thousand for the same period in 2024[17]. - Basic earnings per share for the three months ended September 30, 2025, was $0.57, compared to $0.18 for the same period in 2024, reflecting a growth of 216.7%[17]. - For the nine months ended September 30, 2025, net income reached $26,998,000, compared to $771,000 in 2024, indicating a remarkable increase of 3,403%[25]. - Total comprehensive income for the three months ended September 30, 2025, was $19,467,000, up from $15,203,000 in 2024, reflecting a growth of 28.9%[19]. - The total shareholders' equity as of September 30, 2025, was $397,576,000, an increase from $363,515,000 in 2024, indicating a growth of 9.4%[22]. Asset Growth - Total assets increased to $3,612,264 thousand as of September 30, 2025, up from $3,521,771 thousand at December 31, 2024, representing a growth of 2.6%[14]. - Total deposits rose to $3,075,931 thousand as of September 30, 2025, compared to $2,910,777 thousand at December 31, 2024, marking an increase of 5.7%[15]. - Cash and due from banks increased to $39,823 thousand as of September 30, 2025, compared to $28,029 thousand at December 31, 2024, an increase of 42.1%[14]. - The total number of common shares outstanding increased from 18,945,593 as of September 30, 2024, to 19,138,677 as of September 30, 2025, an increase of 1.02%[22]. Loan Portfolio - Total gross loans amounted to $2,450,274,000 as of September 30, 2025, an increase from $2,332,345,000 as of December 31, 2024, representing a growth of approximately 5.1%[58]. - The company reported a total of $1,848,301,000 in real estate loans as of September 30, 2025, up from $1,736,498,000 at the end of 2024, marking an increase of about 6.4%[58]. - Loans originated under Small Business Administration (SBA) programs totaled $20,715,000 as of September 30, 2025, with 78% secured by government guarantees[59]. - Nonaccrual loans totaled $7,072,000 as of September 30, 2025, compared to $6,461,000 as of December 31, 2024, indicating an increase of approximately 9.5%[68]. - The total loan portfolio as of September 30, 2025, amounts to $158.169 million, with a significant portion classified as Pass/Watch loans at $148.381 million[75]. Credit Losses and Provisions - The allowance for credit losses increased to $29,590 thousand as of September 30, 2025, compared to $25,803 thousand at December 31, 2024, reflecting a rise of 10.7%[14]. - The provision for credit losses for the three months ended September 30, 2025, was $667 thousand, compared to a credit of $518 thousand in the same period of 2024[17]. - The provision for credit losses for the three months ended September 30, 2025, was primarily driven by loan growth and deteriorating economic forecasts, resulting in a total provision of $3,239,000[66]. - The company’s management believes that the allowance for credit losses at September 30, 2025, appropriately reflects expected credit losses in the loan portfolio[66]. Non-Interest Income and Expenses - Non-interest expenses decreased to $22,167 thousand for the three months ended September 30, 2025, down from $27,677 thousand in the same period of 2024, a reduction of 20.0%[17]. - The total non-interest income for the three months ended September 30, 2025, was $2,966 thousand, compared to $1,105 thousand in the same period of 2024, reflecting a growth of 168.5%[17]. - Total other non-interest income for the three months ended September 30, 2025, was $2,473,000, slightly down from $2,480,000 in the same period of 2024[111]. - Total other non-interest expense for the three months ended September 30, 2025, was $6,709,000, a decrease from $11,280,000 in the same period of 2024[111]. Dividends and Shareholder Returns - Cash dividend payments on common stock for the nine months ended September 30, 2025, were $6,863,000, compared to $5,957,000 in 2024, reflecting an increase of 15.2%[25]. - The company reported a cash dividend per common share of $0.12 for both the three and nine months ended September 30, 2025, consistent with the same periods in 2024[17]. - The company declared a cash dividend of $0.12 per share on October 15, 2025, payable on November 14, 2025, to shareholders of record as of October 31, 2025[137]. Merger and Acquisition - The merger between Central Valley Community Bancorp and Community West Bancshares was completed on April 1, 2024, with Community West Bank merging into Central Valley Community Bank[38]. - The total merger consideration for Community West Bank was $143.714 million, with $139.970 million in shares issued and $2 million in cash consideration[41]. - The acquisition resulted in total assets acquired of $1.041 billion and total liabilities assumed of $940.276 million, leading to net assets acquired of $100.663 million[41]. - Goodwill from the transaction amounted to $43 million, which is nondeductible for tax purposes, reflecting the premium paid over the fair value of net tangible and intangible assets[41]. Securities and Investments - The Company reported total available-for-sale securities at a fair value of $473.075 million as of September 30, 2025, with gross unrealized losses of $42.923 million[43]. - Held-to-maturity securities had a fair value of $266.706 million as of September 30, 2025, with gross unrealized losses of $21.161 million[43]. - The fair value of acquired non-credit deteriorated loans was $892.090 million, with gross contractual amounts receivable of $1.124 billion[42]. - The company did not record an allowance for credit losses on any available-for-sale securities as of September 30, 2025, indicating no credit impairment[50].

[Executive Summary & Financial Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Financial%20Highlights) This section provides an overview of the company's financial performance for Q3 2025, including key earnings metrics, management commentary, and significant financial highlights [Q3 2025 Earnings Overview](index=1&type=section&id=Q3%202025%20Earnings%20Overview) Community West Bancshares reported a significant increase in net income and diluted EPS for Q3 2025 compared to both the previous quarter and the same period in 2024, alongside a declared quarterly cash dividend | Metric | Q3 2025 | Q3 2024 | | :----------------------- | :---------- | :---------- | | Net Income | $10.873 million | $3.385 million | | Diluted EPS | $0.57 | $0.18 | - The Company declared a **$0.12 per common share cash dividend**, payable on November 14, 2025, to shareholders of record as of October 31, 2025[2](index=2&type=chunk) [CEO & CFO Commentary](index=1&type=section&id=CEO%20%26%20CFO%20Commentary) The CEO highlighted the company's solid third-quarter results, reflecting team strength and client trust, with a continued focus on discipline, credit quality, deposit stability, and prudent liquidity. The CFO emphasized record income growth and increasing net interest margin over six consecutive quarters, positioning the company for long-term shareholder value - CEO James J. Kim noted the company's mission-driven approach as a community bank partner, maintaining focus on credit quality, deposit stability, and prudent liquidity management amidst evolving economic conditions[3](index=3&type=chunk) - CFO Shannon Livingston reported one of the strongest quarters in recent years, marked by **six consecutive quarters of increasing net interest margin** and record income growth, attributing success to synergies, discipline, and exceptional service culture[5](index=5&type=chunk) [Key Financial Highlights](index=1&type=section&id=Key%20Financial%20Highlights) The third quarter of 2025 saw significant improvements across key financial metrics, including increased net income, reduced provision for credit losses, growth in loans and deposits, improved net interest margin, and strong capital positions Q3 2025 Financial Highlights (vs. Q2 2025) | Metric | Q3 2025 | Q2 2025 | Change (QoQ) | | :-------------------------------------- | :----------- | :----------- | :----------- | | Net Income | $10.87 million | $7.83 million | +38.8% | | Diluted EPS | $0.57 | $0.41 | +39.0% | | Provision for Credit Losses | $0.667 million | $2.61 million | -74.4% | | Gross Loans Increase | $51.8 million| - | +2.16% | | Total Deposits Increase | $81.0 million| - | +2.70% | | Total Cost of Deposits | 1.39% | 1.43% | -0.04 pp | | Net Interest Margin | 4.20% | 4.10% | +0.10 pp | Capital Ratios as of September 30, 2025 | Capital Ratio | Percentage | | :------------------------ | :--------- | | Tier 1 Leverage Ratio | 9.53% | | Common Equity Tier 1 Ratio| 11.60% | | Tier 1 Risk-Based Capital | 11.78% | | Total Risk-Based Capital | 14.07% | [Results of Operations](index=2&type=section&id=Results%20of%20Operations) This section analyzes the company's financial performance, focusing on consolidated income, net interest income, non-interest income, and non-interest expenses [Consolidated Income Statement Analysis](index=2&type=section&id=Consolidated%20Income%20Statement%20Analysis) The company's net income significantly increased in Q3 2025 compared to both the prior quarter and the same period last year, driven by higher net interest income, lower provision for credit losses, and increased non-interest income Consolidated Net Income (in millions) | Metric | Q3 2025 | Q2 2025 | Q3 2024 | YTD 2025 | YTD 2024 | | :---------- | :--------- | :--------- | :--------- | :--------- | :--------- | | Net Income | $10.873 | $7.832 | $3.385 | $26.998 | $0.771 | - Net income before income taxes for Q3 2025 was **$15.076 million**, a substantial increase from **$4.160 million** in Q3 2024[6](index=6&type=chunk) [Net Interest Income and Margin](index=4&type=section&id=Net%20Interest%20Income%20and%20Margin) Net interest income before provision for credit losses increased significantly year-over-year, primarily due to organic loan growth, an increase in the yield on interest-earning assets, and a decrease in the cost of total deposits, leading to a higher net interest margin Net Interest Income and Margin Trends | Metric | Q3 2025 | Q2 2025 | Q3 2024 | | :----------------------------------------- | :------- | :------- | :------- | | Net Interest Margin (fully tax equivalent) | 4.20% | 4.10% | 3.69% | | Net Interest Income (before provision) | $34.944 million | $33.304 million | $30.214 million | | Yield on Interest Earning Assets | 5.62% | 5.65% | 5.52% | | Cost of Total Deposits | 1.39% | 1.43% | 1.69% | - Net interest income before provision for credit losses increased by **$4.730 million** or **15.65%** year-over-year for Q3 2025[13](index=13&type=chunk) - The decrease in the cost of deposits is primarily attributed to rate decreases in money market and time deposit portfolios from both acquired deposits (April 2024 merger) and the Company's existing base[13](index=13&type=chunk) [Non-Interest Income Analysis](index=4&type=section&id=Non-Interest%20Income%20Analysis) Total non-interest income increased significantly quarter-over-quarter and year-to-date, primarily driven by a net gain on death benefits and a substantial reduction in realized losses on investment securities, despite some offsets from lower interchange and loan placement fees year-to-date Non-Interest Income (in millions) | Metric | Q3 2025 | Q2 2025 | % Change (QoQ) | YTD 2025 | YTD 2024 | % Change (YoY) | | :-------------------------- | :------ | :------ | :------------- | :------- | :------- | :------------- | | Total Non-Interest Income | $2.966 | $2.364 | 25.5% | $7.941 | $4.142 | 91.7% | | Gain on proceeds from death benefits | $0.198 | $0 | —% | $0.198 | $0 | —% | | Net realized losses on sales and calls of investment securities | $(0.026) | $(0.015) | 73.3% | $(0.041) | $(4.199) | (99.0)% | - The increase in total non-interest income for Q3 2025 compared to the trailing quarter was primarily driven by a net gain on proceeds from death benefits of **$0.198 million** and income from CRA investments of **$0.273 million**[15](index=15&type=chunk) - Year-to-date non-interest income growth was largely due to a significant reduction in realized losses on sales and calls of investment securities, decreasing from **$4.199 million** in 2024 to **$0.041 million** in 2025[17](index=17&type=chunk) [Non-Interest Expense Analysis](index=5&type=section&id=Non-Interest%20Expense%20Analysis) Total non-interest expenses decreased quarter-over-quarter and year-to-date, mainly due to reductions in professional services, data processing, and merger-related expenses, partially offset by increases in salary and employee benefits, occupancy, and information technology Non-Interest Expenses (in millions) | Metric | Q3 2025 | Q2 2025 | % Change (QoQ) | YTD 2025 | YTD 2024 | % Change (YoY) | | :-------------------------- | :------ | :------ | :------------- | :------- | :------- | :------------- | | Total Non-Interest Expenses | $22.167 | $22.296 | (0.6)% | $67.934 | $71.513 | (5.0)% | | Professional services | $0.447 | $0.639 | (30.0)% | $1.950 | $2.187 | (10.8)% | | Data processing expense | $0.748 | $0.855 | (12.5)% | $2.403 | $3.010 | (20.2)% | | Merger and acquisition expense | - | - | - | $0.278 | $9.147 | (97.0)% | | Salaries and employee benefits | $12.525 | $12.260 | 2.2% | $37.744 | $35.800 | 5.4% | - The quarter-over-quarter decrease in non-interest expense was driven by lower professional services, data processing, and information technology costs, partially offset by increased accruals for incentive compensation[18](index=18&type=chunk) - The year-to-date decrease in non-interest expenses was primarily due to a significant reduction in non-recurring merger expenses[20](index=20&type=chunk) [Non-GAAP Financial Measures Reconciliation](index=2&type=section&id=Non-GAAP%20Financial%20Measures%20Reconciliation) This section provides a reconciliation of GAAP and non-GAAP financial measures, offering supplemental information for investors to analyze core operating results and facilitate comparisons [Reconciliation of GAAP and Non-GAAP Financial Measures](index=2&type=section&id=Reconciliation%20of%20GAAP%20and%20Non-GAAP%20Financial%20Measures) The company provides non-GAAP financial measures to offer supplemental information for investors, facilitating analysis of core operating results and comparisons across reporting periods, and for internal budgeting and management Key GAAP vs. Non-GAAP Metrics (in millions, except percentages) | Metric | Q3 2025 (GAAP) | Q3 2025 (Non-GAAP) | Q3 2024 (GAAP) | Q3 2024 (Non-GAAP) | | :---------------------------------------- | :------------- | :----------------- | :------------- | :----------------- | | Net Income | $10.873 | - | $3.385 | - | | Net income before income tax and provision expense | - | $15.743 | - | $3.642 | | Return on average assets (Annualized) | 1.21% | 1.75% | 0.38% | 0.41% | | Return on average equity (Annualized) | 11.25% | 16.29% | 3.84% | 4.13% | | Tangible common equity | - | $292.232 | - | $257.618 | | Tangible common shareholders' equity per share | - | $15.27 | - | $13.60 | - Management uses non-GAAP financial measures to establish budgets and manage the Company's business, believing they provide useful supplemental information to investors[7](index=7&type=chunk) [Balance Sheet Summary](index=6&type=section&id=Balance%20Sheet%20Summary) This section provides an overview of the company's balance sheet, detailing asset, loan portfolio, deposit, and liquidity positions [Assets Overview](index=6&type=section&id=Assets%20Overview) Total assets and average assets showed growth, primarily driven by an increase in average gross loans, while average gross investment securities decreased due to sales, calls, and maturities Asset Trends (in millions) | Metric | Sep 30, 2025 | Dec 31, 2024 | % Change (YTD) | | :-------------------------- | :----------- | :----------- | :------------- | | Total Assets | $3,612.264 | $3,521.771 | 2.57% | | Average Assets (Q3) | $3,595.359 | $3,541.444 | 1.52% (YoY) | | Average Gross Investment Securities (Q3) | $818.816 | $895.424 | (8.56)% (YoY) | | Total Average Gross Loans (Q3) | $2,410.272 | $2,278.313 | 6.01% (YoY) | - The decrease in average gross investment securities compared to the prior year was a result of sales, calls, and maturities of available-for-sale (AFS) and held-to-maturity (HTM) securities[22](index=22&type=chunk) [Loan Portfolio Composition](index=7&type=section&id=Loan%20Portfolio%20Composition) The loan portfolio continued to be dominated by real estate loans, which increased in both absolute terms and as a percentage of total loans, while consumer loans also saw a slight increase Loan Portfolio Composition (in millions) | Loan Type | Sep 30, 2025 Amount | Sep 30, 2025 % of Total | Dec 31, 2024 Amount | Dec 31, 2024 % of Total | | :-------------------------------------- | :------------------ | :---------------------- | :------------------ | :---------------------- | | Total Commercial | $180.795 | 7.3% | $180.745 | 7.7% | | Total Real Estate | $1,848.301 | 75.5% | $1,736.498 | 74.4% | | Total Consumer | $421.178 | 17.2% | $415.102 | 17.8% | | Total Gross Loans | $2,451.142 | 100.0% | $2,334.221 | 100.0% | - Commercial real estate - non-owner occupied loans represent the largest single category, accounting for **39.7%** of the total loan portfolio at September 30, 2025[24](index=24&type=chunk) [Deposit Composition](index=7&type=section&id=Deposit%20Composition) Total deposits increased significantly year-to-date and quarter-over-quarter, with non-interest bearing deposits growing to represent a larger portion of total deposits, indicating improved funding stability Deposit Composition (in millions) | Deposit Type | Sep 30, 2025 Amount | Sep 30, 2025 % of Total | Dec 31, 2024 Amount | Dec 31, 2024 % of Total | | :------------------------ | :------------------ | :---------------------- | :------------------ | :---------------------- |\ | Total Interest-Bearing | $1,984.114 | 64.5% | $1,929.953 | 66.3% | | Non-Interest Bearing | $1,091.817 | 35.5% | $980.824 | 33.7% | | Total Deposits | $3,075.931 | 100.0% | $2,910.777 | 100.0% | - Total average deposits increased by **$135.348 million** or **4.61%** year-over-year for Q3 2025[24](index=24&type=chunk) - The ratio of average non-interest bearing deposits to total deposits increased to **35.79%** for Q3 2025, up from **34.48%** in Q2 2025[24](index=24&type=chunk) [Liquidity Position](index=8&type=section&id=Liquidity%20Position) The company maintains significant liquidity, with an increase in total available liquidity sources year-to-date, driven by higher FHLB borrowing availability and excess pledged securities, despite a decrease in short-term borrowings Liquidity Sources (in millions) | Liquidity Source | Sep 30, 2025 | Dec 31, 2024 | | :-------------------------------- | :----------- | :----------- | | Cash and cash equivalents | $121.558 | $120.398 | | Unpledged investment securities | $350.057 | $403.669 | | FHLB borrowing availability | $737.720 | $576.556 | | Total Liquidity | $1,407.362 | $1,284.317 | - Short-term borrowings decreased significantly to **$20 million** at September 30, 2025, from **$133.442 million** at December 31, 2024[26](index=26&type=chunk) [Credit Quality](index=8&type=section&id=Credit%20Quality) This section assesses the company's credit quality, including loan loss provisions, allowance for credit losses, and loan risk ratings [Loan Loss Provision and Recoveries](index=8&type=section&id=Loan%20Loss%20Provision%20and%20Recoveries) The company recorded a provision for loan losses in Q3 2025, a shift from a credit in the prior year, while net loan recoveries decreased year-over-year Provision for Credit Losses and Net Recoveries (in millions) | Metric | Q3 2025 | Q3 2024 | | :---------------------------------------- | :------ | :------ | | Net loan recoveries | $0.075 | $0.162 | | Provision for loan losses | $0.793 | $(0.212) | | Credit to provision for HTM securities | $(0.062) | $(0.219) | | Credit to provision for unfunded commitments | $(0.064) | $(0.087) | - The net recovery ratio was **0.01%** for Q3 2025, compared to **0.03%** for Q3 2024[27](index=27&type=chunk) [Allowance for Credit Losses](index=8&type=section&id=Allowance%20for%20Credit%20Losses) The allowance for credit losses for loans increased year-to-date, reflecting a provision for loan losses and net recoveries, with the company believing the allowance is adequate Allowance for Credit Losses (in millions) | Metric | Sep 30, 2025 | Dec 31, 2024 | | :---------------------------------------- | :----------- | :----------- | | Allowance for credit losses for loans | $29.590 | $25.803 | | Allowance for credit losses as % of total loans | 1.21% | 1.11% | - The net increase in the allowance for credit losses for loans was **$3.787 million** year-to-date[28](index=28&type=chunk) [Loan Risk Ratings](index=8&type=section&id=Loan%20Risk%20Ratings) The majority of the loan portfolio remains in 'Pass' risk rating, though there was an increase in 'Substandard' loans and a slight increase in 'Special mention' loans quarter-over-quarter Loan Risk Rating Composition (in millions) | Loan Risk Rating | Sep 30, 2025 Amount | Sep 30, 2025 % of Total | Jun 30, 2025 Amount | Jun 30, 2025 % of Total | Sep 30, 2024 Amount | Sep 30, 2024 % of Total | | :--------------- | :------------------ | :---------------------- | :------------------ | :---------------------- | :------------------ | :---------------------- | | Pass | $2,359.148 | 96.3% | $2,320.608 | 96.7% | $2,228.707 | 97.0% | | Special mention | $24.925 | 1.0% | $19.706 | 0.8% | $28.799 | 1.3% | | Substandard | $67.069 | 2.7% | $59.073 | 2.5% | $39.637 | 1.7% | [Capital and Dividends](index=9&type=section&id=Capital%20and%20Dividends) This section reviews the company's capital adequacy through key ratios and details the latest cash dividend declaration [Capital Ratios](index=14&type=section&id=Capital%20Ratios) The company maintained strong capital positions, with all key capital ratios showing slight improvements or stability quarter-over-quarter, indicating continued financial strength Bancorp Capital Ratios | Capital Ratio | Sep 30, 2025 | Jun 30, 2025 | Dec 31, 2024 | | :------------------------ | :----------- | :----------- | :----------- | | Tier 1 Leverage | 9.52% | 9.48% | 9.17% | | Common Equity Tier 1 | 11.60% | 11.42% | 11.15% | | Tier 1 Risk-Based Capital | 11.77% | 11.59% | 11.33% | | Total Risk-Based Capital | 14.07% | 13.89% | 13.58% | [Cash Dividend Declaration](index=9&type=section&id=Cash%20Dividend%20Declaration) The Board of Directors declared a regular quarterly cash dividend of $0.12 per share, reflecting the company's well-capitalized status and expectation to maintain adequate capital levels - A regular quarterly cash dividend of **$0.12 per share** on common stock was declared on October 15, 2025[30](index=30&type=chunk) - The dividend is payable on November 14, 2025, to shareholders of record as of October 31, 2025[30](index=30&type=chunk) - The Company continues to be well capitalized and expects to maintain adequate capital levels[30](index=30&type=chunk) [Company Information](index=9&type=section&id=Company%20Information) This section provides essential information about Community West Bancshares, including its overview, board of directors, and contact details [Company Overview](index=9&type=section&id=Company%20Overview) Community West Bancshares, established in 1979, operates through its subsidiary Community West Bank, providing a range of banking services across Central California with a focus on supporting businesses and communities - Community West Bancshares (NASDAQ: CWBC) and its subsidiary, Community West Bank, are headquartered in Fresno, California[31](index=31&type=chunk) - The Bank operates full-service Banking Centers throughout Central California, offering Commercial Lending, Agribusiness, SBA, Residential Construction and Mortgage, Manufactured Housing, Private Banking, and Cash Management[31](index=31&type=chunk) [Board of Directors](index=9&type=section&id=Board%20of%20Directors) The report lists the members of the Company and Bank Board of Directors, including key executive roles such as Chairman, Vice Chairman, CEO, and President - Key board members include Daniel J. Doyle (Chairman), Robert H. Bartlein (Vice Chairman), James J. Kim (CEO of the Company and President and CEO of the Bank), and Martin E. Plourd (President of the Company)[32](index=32&type=chunk) [Contact Information](index=16&type=section&id=Contact%20Information) Contact details for investor and media inquiries are provided, including the Executive Vice President, Chief Financial Officer, and Public Relations - Investor contact: Shannon Livingston, Executive Vice President, Chief Financial Officer, Community West Bancshares (916-235-4617)[51](index=51&type=chunk) - Media contact: Debbie Nalchajian-Cohen, Public Relations (559-222-1322)[51](index=51&type=chunk) [Forward-Looking Statements](index=10&type=section&id=Forward-Looking%20Statements) This section includes a disclaimer regarding forward-looking statements, outlining the inherent risks and uncertainties that could cause actual results to differ materially from projections [Disclaimer on Forward-Looking Statements](index=10&type=section&id=Disclaimer%20on%20Forward-Looking%20Statements) The report contains forward-looking statements subject to various risks and uncertainties that could cause actual results to differ materially from projections, including economic conditions, interest rate changes, credit quality, and regulatory compliance. Readers are cautioned not to place undue reliance on these statements, which are valid only as of their making - Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from projections[35](index=35&type=chunk) - Key risks include current and future business, economic and market conditions, inflationary pressures, changes in interest rates, geopolitical developments, credit quality, liquidity issues, and regulatory requirements[35](index=35&type=chunk) - The company does not undertake any obligation to update or review any forward-looking statement[36](index=36&type=chunk) [Financial Statements](index=11&type=section&id=Financial%20Statements) This section presents the company's detailed financial statements, including consolidated balance sheets, income statements, and key financial ratios [Consolidated Balance Sheets](index=11&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheets provide a snapshot of the company's financial position, detailing assets, liabilities, and shareholders' equity at various reporting dates Consolidated Balance Sheet Highlights (in millions) | Metric | Sep 30, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :-------------------------- | :----------- | :----------- | :----------- | | Total Assets | $3,612.264 | $3,521.771 | $3,531.298 | | Total Deposits | $3,075.931 | $2,910.777 | $2,921.695 | | Total Liabilities | $3,214.688 | $3,159.086 | $3,167.783 | | Total Shareholders' Equity | $397.576 | $362.685 | $363.515 | [Consolidated Statements of Income](index=12&type=section&id=Consolidated%20Statements%20of%20Income) The consolidated statements of income present the company's financial performance over the three and nine months ended September 30, 2025 and 2024, detailing interest income, interest expense, non-interest income, non-interest expenses, and net income Consolidated Statements of Income Highlights (in millions) | Metric | Q3 2025 | Q3 2024 | YTD 2025 | YTD 2024 | | :---------------------------------------- | :--------- | :--------- | :--------- | :--------- | | Total Interest Income | $46.888 | $45.285 | $138.052 | $114.909 | | Total Interest Expense | $11.944 | $15.071 | $37.621 | $36.566 | | Net Interest Income before provision | $34.944 | $30.214 | $100.431 | $78.343 | | Provision (credit) for credit losses | $0.667 | $(0.518) | $3.239 | $9.889 | | Total Non-Interest Income | $2.966 | $1.105 | $7.941 | $4.142 | | Total Non-Interest Expenses | $22.167 | $27.677 | $67.934 | $71.513 | | Net Income | $10.873 | $3.385 | $26.998 | $0.771 | | Diluted Earnings Per Common Share | $0.57 | $0.18 | $1.42 | $0.05 | [Condensed Consolidated Statements of Income (Quarterly)](index=13&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20(Quarterly)) This section provides a condensed view of the company's quarterly income statement, allowing for a quick comparison of performance across recent quarters Condensed Quarterly Income Statement (in millions) | Metric | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :---------------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Net interest income | $34.944 | $33.304 | $32.182 | $32.024 | $30.214 | | Provision (credit) for credit losses | $0.667 | $2.613 | $(0.041) | $1.224 | $(0.518) | | Total non-interest income | $2.966 | $2.364 | $2.611 | $2.303 | $1.105 | | Total non-interest expense | $22.167 | $22.296 | $23.470 | $23.188 | $27.677 | | Net income | $10.873 | $7.832 | $8.293 | $6.895 | $3.385 | | Diluted earnings per common share | $0.57 | $0.41 | $0.44 | $0.36 | $0.18 | [Selected Ratios](index=14&type=section&id=Selected%20Ratios) This section provides key financial ratios, offering insights into the company's asset quality, profitability, efficiency, and capital adequacy over several quarters Key Financial Ratios | Ratio | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :---------------------------------------- | :----------- | :----------- | :----------- | :----------- | :----------- | | Allowance for credit losses to total loans| 1.21% | 1.20% | 1.11% | 1.11% | 1.08% | | Non-performing assets to total assets | 0.20% | 0.20% | 0.20% | 0.18% | 0.09% | | Net interest margin | 4.20% | 4.10% | 4.04% | 3.95% | 3.69% | | Return on average assets | 1.21% | 0.88% | 0.94% | 0.78% | 0.38% | | Return on average equity | 11.25% | 8.30% | 8.97% | 7.55% | 3.84% | | Efficiency ratio | 58.47% | 62.51% | 67.38% | 67.55% | 88.37% | | Tier 1 leverage - Bancorp | 9.52% | 9.48% | 9.36% | 9.17% | 9.38% | [Schedule of Average Balances and Average Yields and Rates (Quarterly)](index=15&type=section&id=Schedule%20of%20Average%20Balances%20and%20Average%20Yields%20and%20Rates%20(Quarterly)) This schedule details the average balances of interest-earning assets and interest-bearing liabilities, along with their corresponding interest income/expense and average rates for recent quarters, providing a comprehensive view of net interest margin drivers Average Balances and Yields/Rates (Q3 2025 vs Q3 2024) | Metric | Q3 2025 Average Balance (millions) | Q3 2025 Average Rate | Q3 2024 Average Balance (millions) | Q3 2024 Average Rate | | :---------------------------------------- | :---------------------- | :------------------- | :---------------------- | :------------------- | | Total Interest-Earning Assets | $3,333.432 | 5.62% | $3,292.643 | 5.52% | | Total Interest-Bearing Liabilities | $2,063.735 | 2.30% | $2,047.083 | 2.93% | | Net Interest Margin | - | 4.20% | - | 3.69% | - The average interest rate on total interest-bearing deposits decreased from **2.69%** in Q3 2024 to **2.17%** in Q3 2025[47](index=47&type=chunk) [Schedule of Average Balances and Average Yields and Rates (Year-to-Date)](index=16&type=section&id=Schedule%20of%20Average%20Balances%20and%20Average%20Yields%20and%20Rates%20(Year-to-Date)) This schedule provides year-to-date average balances, interest income/expense, and average rates for interest-earning assets and interest-bearing liabilities, facilitating a comparison of performance over longer periods Average Balances and Yields/Rates (YTD Sep 30, 2025 vs YTD Sep 30, 2024) | Metric | YTD 2025 Average Balance (millions) | YTD 2025 Average Rate | YTD 2024 Average Balance (millions) | YTD 2024 Average Rate | | :---------------------------------------- | :----------------------- | :-------------------- | :----------------------- | :-------------------- | | Total Interest-Earning Assets | $3,296.089 | 5.64% | $2,878.474 | 5.38% | | Total Interest-Bearing Liabilities | $2,095.945 | 2.40% | $1,722.415 | 2.83% | | Net Interest Margin | - | 4.12% | - | 3.69% | - Average loans increased significantly year-to-date, from **$1,869.985 million** in 2024 to **$2,367.824 million** in 2025, contributing to higher interest income[49](index=49&type=chunk)

Financial Performance - Net income for the six months ended June 30, 2025, was $16,125 thousand, compared to a net loss of $2,614 thousand for the same period in 2024, indicating a significant turnaround[16] - Basic earnings per share improved to $0.41 for the three months ended June 30, 2025, compared to a loss of $0.33 in the same period of 2024[16] - For the three months ended June 30, 2025, net income was $7,832,000 compared to a net loss of $6,290,000 for the same period in 2024, representing a significant turnaround[18] - Total comprehensive income for the three months ended June 30, 2025, was $9,784,000, compared to a loss of $3,230,000 in the same period of 2024[18] - Total revenue for the period ending June 30, 2025, reached $6.752 billion, an increase from $6.446 billion in the previous period[67] Asset Growth - Total assets increased to $3,576,811 thousand as of June 30, 2025, compared to $3,521,771 thousand at December 31, 2024, reflecting a growth of 1.6%[14] - Cash and cash equivalents at the end of the period increased to $134,373,000 as of June 30, 2025, up from $109,669,000 in 2024[24] - Cash and due from banks increased to $48,158 thousand as of June 30, 2025, compared to $28,029 thousand at December 31, 2024, a growth of 71.8%[14] - Total deposits increased to $2,994,921 thousand as of June 30, 2025, from $2,910,777 thousand at December 31, 2024, representing a growth of 2.9%[14] Credit Quality - Provision for credit losses decreased to $2,613 thousand for the three months ended June 30, 2025, down from $9,831 thousand in the same period of 2024, a reduction of 73.4%[16] - The allowance for credit losses increased to $28,722,000 as of June 30, 2025, up from $25,803,000 at the end of 2024, indicating a rise of about 7.4%[56] - Nonaccrual loans totaled $6,769,000 as of June 30, 2025, compared to $6,461,000 as of December 31, 2024, showing an increase of approximately 4.8%[66] - The provision for credit losses for the three months ended June 30, 2025, was $2,640,000, reflecting the impact of loan growth and deteriorating economic forecasts[63] Expenses and Income - Total non-interest expenses decreased to $22,296 thousand for the three months ended June 30, 2025, from $28,503 thousand in the same period of 2024, a decline of 21.8%[16] - Non-interest income for the six months ended June 30, 2025, was $4,975 thousand, compared to $3,037 thousand in the same period of 2024, an increase of 63.9%[16] - Interest on deposits decreased to $10,538 thousand for the three months ended June 30, 2025, down from $12,266 thousand in the same period of 2024, a decrease of 14.1%[16] Merger and Acquisition - The merger between Central Valley Community Bancorp and Community West Bancshares was completed on April 1, 2024, with Community West Bank merging into Central Valley Community Bank[36] - The total merger consideration for Community West was approximately $143.7 million, including $140 million in shares issued and $3.7 million in options assumed[39] - The total assets acquired in the recent acquisition amounted to $1,040,939,000, with liabilities assumed at $940,276,000, reflecting a strategic expansion[25] - Goodwill created from the transaction was $43 million, which is nondeductible for tax purposes, reflecting the premium paid over the fair value of net tangible and intangible assets[39] Securities and Investments - The total available-for-sale securities as of June 30, 2025, had an amortized cost of $523,679,000 and an estimated fair value of $469,354,000, indicating a total unrealized loss of $54,430,000[44] - The total held-to-maturity securities amounted to $263.7 million, with gross unrealized losses of $28.6 million as of June 30, 2025[41] - The unrealized gain on securities available for sale was $4,896,000 for the six months ended June 30, 2025, down from $6,248,000 in 2024, reflecting market fluctuations[25] Shareholder Equity - The company issued 7,037,202 shares of common stock due to a business combination, increasing total shareholders' equity significantly[20] - Total shareholders' equity increased to $380,002,000 as of June 30, 2025, up from $362,685,000 at the end of 2024, reflecting growth in retained earnings and comprehensive income[21] - The company declared a cash dividend of $0.12 per share on July 16, 2025, payable on August 15, 2025[133] Loan Portfolio - Total loans outstanding reached $2,399,387 million, with Pass/Watch loans accounting for $2,320,608 million, representing approximately 96.7% of the total[74] - The commercial real estate loans (non-owner occupied) amounted to $938,865,000 as of June 30, 2025, up from $913,165,000 at the end of 2024, a growth of about 2.8%[56] - Loans originated under Small Business Administration (SBA) programs totaled $21,403,000 as of June 30, 2025, with 76% secured by government guarantees[57] - The company reported a net deferred origination cost of $1,514,000 as of June 30, 2025, down from $1,876,000 at the end of 2024[56] Risk Management - The Company reported a significant concentration of credit risk in its banking operations, primarily from loans and leases, which generate the majority of interest and fee income[30] - The company utilizes a probability-weighted, multiple scenario forecast approach for measuring the allowance for credit losses, incorporating macroeconomic scenarios[58] - The company maintains an internal asset classification system to monitor loan performance and potential risks[67]

Financial Performance - The Company reported unaudited consolidated net income of $7,832,000 and diluted earnings per share of $0.41 for Q2 2025, compared to a net loss of $6,290,000 and $0.33 per diluted share in Q2 2024[2]. - Net income for Q2 2025 was $7,832,000, a decrease of 5.6% from $8,293,000 in Q1 2025, but a significant recovery from a net loss of $6,290,000 in Q2 2024[40]. - Basic earnings per share for Q2 2025 was $0.41, down from $0.44 in Q1 2025, while it improved from a loss of $0.33 in Q2 2024[40]. Loan and Deposit Growth - Gross loans increased by $52.5 million or 2.20% for Q2 2025 compared to Q1 2025, and increased $65.2 million or 2.80% year-to-date[4]. - Total deposits increased by $66.0 million or 2.30% compared to Q1 2025 and $84.1 million or 2.90% year-to-date[4]. - Total gross loans increased by $141,862,000 or 6.40% compared to Q2 2024, reaching $2,399,387,000[21]. - Total deposits rose by $78,964,000 or 2.70% to $2,994,921,000 for Q2 2025 compared to Q2 2024[22]. Interest Income and Margin - Net interest margin increased to 4.10% for Q2 2025, up from 4.04% in Q1 2025 and 3.95% in Q4 2024[4]. - The Company's net interest margin for Q2 2025 was 4.10%, up from 3.65% in Q2 2024 and 4.04% in Q1 2025[12]. - Total interest income for Q2 2025 was $46,025,000, an increase of 4.0% from Q1 2025's $45,138,000 and up 4.6% from Q2 2024's $43,997,000[38]. - Net interest income increased by $4,247,000 or 14.62% to $33,304,000 in Q2 2025 compared to $29,057,000 in Q2 2024[12]. Credit Losses and Allowance - The provision for credit losses was $2.61 million in Q2 2025, a significant increase from a credit of $41,000 in Q1 2025, attributed to strong loan growth and deteriorating economic forecasts[4]. - The Company recorded net recoveries of $13,000 in Q2 2025, compared to net charge-offs of $41,000 in Q2 2024, resulting in a net charge-off ratio of 0.00%[26]. - The allowance for credit losses for loans was $28,722,000 as of June 30, 2025, an increase of $2,919,000 from $25,803,000 at December 31, 2024[27]. - The allowance for credit losses stood at $26,005 thousand for the six months ended June 30, 2025, compared to $20,271 thousand in the prior year[47]. Expenses and Efficiency - Non-interest expenses decreased by $1,174,000 or 5.0% to $22,296,000 in Q2 2025, driven by reductions in salaries and employee benefits[16]. - Total non-interest expenses were $22,296,000 for Q2 2025, down from $23,470,000 in Q1 2025, and a decrease from $28,503,000 in Q2 2024[40]. - The efficiency ratio improved to 62.51% in Q2 2025 from 67.38% in Q1 2025, indicating better cost management[42]. Capital and Liquidity - Capital positions remained strong with a 9.48% Tier 1 Leverage Ratio and a 13.89% Total Risk-Based Capital Ratio as of June 30, 2025[4]. - The Company's cash and cash equivalents increased by $13,975,000 to $134,373,000 as of June 30, 2025, compared to $120,398,000 at December 31, 2024[24]. - Total liquidity sources amounted to $1,314,951,000 as of June 30, 2025, up from $1,284,317,000 at December 31, 2024[25]. Dividends and Share Repurchase - The Company declared a cash dividend of $0.12 per common share, payable on August 15, 2025[2]. - A quarterly cash dividend of $0.12 per share was declared on July 16, 2025, payable on August 15, 2025[28]. - The share repurchase program was approved for up to 3% of the Company's outstanding common stock, approximately 573,915 shares[3]. Mergers and Acquisitions - The Company completed a merger with Community West Bancshares effective April 1, 2024, enhancing its market presence[29]. - The Company recorded goodwill of approximately $43 million and core deposit intangibles of $10 million due to the merger on April 1, 2024[19].

Core Points - The Wonderful Company has launched its $1 million Wonderful Central Valley Community Grants application period, continuing its philanthropic efforts in the San Joaquin Valley [1][3] - Over the past decade, the company and its co-owners have awarded more than $8.5 million in grants to over 142 nonprofits and 165 schools in the region [1][7] - The grants support initiatives in health and wellness, education, recreation, community beautification, art, and social services [2][8] Funding and Application Details - Each year, The Wonderful Company invests over $35 million in community development, education, and health and wellness initiatives across the Central Valley [3][9] - Organizations can apply for grants of up to $50,000 for one year and up to $100,000 for two years [8] - Applications must be submitted by midnight PDT on August 31, with recipients announced in October 2025 [5][8] Community Impact - The Wonderful Community Grants program aims to support essential programs in rural communities facing financial uncertainty [4] - The program encourages applications from organizations serving specific communities in the Central Valley, including Avenal, Delano, and Wasco [4][8] - The Wonderful Company has invested over $2.5 billion in various initiatives, emphasizing its commitment to the Central Valley and beyond [9]

PART 1: FINANCIAL INFORMATION [Item 1: Financial Statements (Unaudited)](index=5&type=section&id=Item%201%3A%20Financial%20Statements%20%28Unaudited%29) This section presents Community West Bancshares' unaudited consolidated financial statements for Q1 2025, including Balance Sheets, Income, Equity, and Cash Flows, with detailed accounting notes [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets reached **$3.55 billion**, up from **$3.52 billion**, with liabilities at **$3.18 billion** and shareholders' equity at **$372.2 million** Consolidated Balance Sheet Highlights (USD in thousands) | Account | March 31, 2025 (USD in thousands) | December 31, 2024 (USD in thousands) | | :--- | :--- | :--- | | **Total Assets** | **$3,553,086** | **$3,521,771** | | Total Cash and Cash Equivalents | $148,392 | $120,398 | | Loans, net | $2,320,802 | $2,308,418 | | Total Deposits | $2,928,678 | $2,910,777 | | **Total Liabilities** | **$3,180,889** | **$3,159,086** | | **Total Shareholders' Equity** | **$372,197** | **$362,685** | [Consolidated Statements of Income](index=7&type=section&id=Consolidated%20Statements%20of%20Income) For Q1 2025, net income rose to **$8.3 million** (EPS **$0.44**) from **$3.7 million** (EPS **$0.31**) in Q1 2024, driven by a substantial increase in net interest income to **$32.2 million** Q1 2025 vs Q1 2024 Income Statement (USD in thousands, except per-share data) | Metric | Q1 2025 (USD in thousands) | Q1 2024 (USD in thousands) | | :--- | :--- | :--- | | Total Interest Income | $45,138 | $25,627 | | Net Interest Income | $32,182 | $19,073 | | **Net Income** | **$8,293** | **$3,676** | | **Diluted EPS** | **$0.44** | **$0.31** | | Cash Dividend per Share | $0.12 | $0.12 | [Consolidated Statements of Cash Flows](index=10&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For Q1 2025, net cash from operating activities was **$11.1 million**, investing provided **$0.8 million**, and financing **$16.1 million**, resulting in a **$28.0 million** net increase in cash and cash equivalents Cash Flow Summary for Three Months Ended March 31 (USD in thousands) | Cash Flow Activity | 2025 (USD in thousands) | 2024 (USD in thousands) | | :--- | :--- | :--- | | Net Cash from Operating Activities | $11,067 | $4,023 | | Net Cash from Investing Activities | $804 | $27,919 | | Net Cash from Financing Activities | $16,123 | $(24,711) | | **Net Increase in Cash** | **$27,994** | **$7,231** | | Cash at End of Period | $148,392 | $60,959 | [Notes to Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies and financial components, including the April 2024 merger that created **$43 million** in goodwill, and cover investment/loan portfolios, ACL, deposits, borrowings, and fair value measurements - Effective April 1, 2024, Central Valley Community Bancorp merged with Community West Bancshares, accounted for using the acquisition method, resulting in **$43.05 million** of goodwill[37](index=37&type=chunk)[41](index=41&type=chunk) - The company's loan portfolio is concentrated in commercial real estate, which constitutes the majority of its lending activities, and it operates as one reportable segment: banking operations[30](index=30&type=chunk) - On April 16, 2025, the Board of Directors declared a **$0.12** per share cash dividend[133](index=133&type=chunk) [Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=40&type=section&id=Item%202%3A%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations%20%28MD%26A%29) Management discusses Q1 2025 financial performance, highlighting **$8.3 million** net income and a **4.04%** net interest margin, covering the April 2024 merger's impact, net interest income, credit quality, non-interest items, and overall financial condition, with strong capital ratios [Financial Highlights](index=42&type=section&id=Financial%20Highlights) For Q1 2025, the company reported strong financial results, with net income of **$8.3 million** (EPS **$0.44**), a **4.04%** net interest margin, total assets of **$3.55 billion**, and robust capital ratios including a **9.36%** Tier 1 Leverage Ratio Key Performance Metrics - Q1 2025 (USD) | Metric | Value | | :--- | :--- | | Net Income | $8.3 million | | Diluted EPS | $0.44 | | Net Interest Margin | 4.04% | | Total Assets | $3.55 billion | | Total Gross Loans | $2.35 billion | | Total Deposits | $2.9 billion | | Tier 1 Leverage Ratio | 9.36% | | Total Risk-Based Capital Ratio | 13.82% | [Results of Operations](index=42&type=section&id=Results%20of%20Operations) Net income for Q1 2025 was **$8.3 million**, up from **$3.7 million** in Q1 2024, primarily due to a **68.7%** increase in net interest income to **$32.2 million** post-merger, alongside rises in non-interest income and expenses Net Interest Income and Margin (Q1 2025 vs Q1 2024, USD in thousands) | Metric | Q1 2025 (USD in thousands) | Q1 2024 (USD in thousands) | | :--- | :--- | :--- | | Net Interest Income (tax-equivalent) | $32,530 | $19,445 | | Net Interest Margin (tax-equivalent) | 4.04% | 3.42% | | Yield on Earning Assets | 5.65% | 4.58% | | Cost of Interest-Bearing Liabilities | 2.48% | 2.11% | - The increase in net interest income was significantly impacted by the April 1, 2024 merger, which added a substantial volume of loans and deposits[155](index=155&type=chunk)[165](index=165&type=chunk) Non-Interest Income & Expense Changes (Q1 2025 vs Q1 2024, USD in thousands) | Category | Q1 2025 (USD in thousands) | Q1 2024 (USD in thousands) | % Change | | :--- | :--- | :--- | :--- | | Total Non-Interest Income | $2,611 | $1,636 | 59.6% | | Total Non-Interest Expense | $23,470 | $15,333 | 53.1% | [Financial Condition](index=49&type=section&id=Financial%20Condition) As of March 31, 2025, total assets were **$3.55 billion**, with gross loans at **$2.35 billion** (56.3% in commercial real estate) and deposits at **$2.93 billion**; nonperforming assets were **$6.9 million**, and shareholders' equity reached **$372.2 million**, indicating strong capital and liquidity - Total gross loans increased by **$12.7 million** (**0.54%**) during Q1 2025 to **$2.35 billion**[184](index=184&type=chunk) - A concentration exists in commercial real estate loans, representing **56.3%** of the total loan portfolio as of March 31, 2025[185](index=185&type=chunk) Capital Ratios (Company) | Ratio | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Tier 1 Leverage Ratio | 9.36% | 9.18% | | CET 1 Ratio | 11.39% | 12.78% | | Tier 1 Risk-Based Capital | 11.57% | 13.07% | | Total Risk-Based Capital | 13.82% | 16.08% | [Item 3: Quantitative and Qualitative Disclosures About Market Risk](index=55&type=section&id=Item%203%3A%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk, managed by ALCO to minimize exposure of net interest margin and equity to rate changes; as of March 31, 2025, risk was within policy, with a **100 bps** rate increase projected to raise net interest income by **2.46%** in year one, and a **100 bps** decrease lowering it by **2.26%** Interest Rate Sensitivity Analysis (Estimated Change in Net Interest Income) | Rate Shift (bps) | Year 1 Change | Year 2 Change | | :--- | :--- | :--- | | +400 | 2.93% | 4.33% | | +200 | 2.38% | 3.30% | | +100 | 2.46% | 3.31% | | -100 | (2.26)% | (3.46)% | | -200 | (3.71)% | (5.74)% | - The company manages interest rate risk by structuring assets and liabilities to correlate the effects of rate changes, with the ALCO and Board reviewing this exposure at least quarterly[213](index=213&type=chunk)[214](index=214&type=chunk) [Item 4: Controls and Procedures](index=56&type=section&id=Item%204%3A%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of the quarter-end, ensuring timely information for SEC filings, with no material changes to internal controls over financial reporting during the period - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[216](index=216&type=chunk) - No changes in internal controls over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[217](index=217&type=chunk) PART II: OTHER INFORMATION [Item 1: Legal Proceedings](index=56&type=section&id=Item%201%3A%20Legal%20Proceedings) The company is subject to ordinary course legal proceedings and claims, but management believes the ultimate liability will not materially affect its financial position or results - The company reports no material legal proceedings outside the ordinary course of business[107](index=107&type=chunk)[219](index=219&type=chunk) [Item 1A: Risk Factors](index=56&type=section&id=Item%201A%3A%20Risk%20Factors) No material changes have occurred to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the fiscal year ended December 31, 2024 - No material changes from the risk factors disclosed in the 2024 Form 10-K have been reported[220](index=220&type=chunk) [Item 2: Unregistered Sales of Equity Securities and Use of Proceeds](index=57&type=section&id=Item%202%3A%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company had nothing to report under this item for the period - None to report[221](index=221&type=chunk) [Item 6: Exhibits](index=58&type=section&id=Item%206%3A%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications, XBRL data files, and incorporates by reference articles of incorporation and bylaws from previous filings - Exhibits filed include CEO and CFO certifications (31.1, 31.2, 32.1, 32.2) and XBRL interactive data files[225](index=225&type=chunk)