PART I [Business](index=6&type=section&id=ITEM%201.%20BUSINESS) Citizens Community Bancorp, Inc. operates as a bank holding company through its subsidiary, Citizens Community Federal N.A., providing commercial, agricultural, and consumer banking services across 22 branches in Wisconsin and Minnesota | Metric | Value (in billions) | | :--- | :--- | | Total Assets | $1.749 | | Total Deposits | $1.488 | | Equity | $0.179 | * The company's subsidiary, Citizens Community Federal N.A., is a federally chartered National Bank serving customers in Wisconsin and Minnesota through **22 full-service branch locations**[20](index=20&type=chunk) [Lending Activities](index=6&type=section&id=Lending%20Activities) The company offers diverse loan products, including commercial real estate, C&I, agricultural, residential mortgages, and consumer loans, primarily in Wisconsin and Minnesota, with **$1.372 billion** in gross loans as of December 31, 2024 Gross Loan Portfolio as of December 31, 2024 | Loan Category | Amount (in millions) | | :--- | :--- | | Commercial/Agricultural Real Estate | $1,081.0 | | C&I/Agricultural Operating | $146.7 | | Residential Mortgage | $135.3 | | Consumer Installment | $9.0 | | **Total Gross Loans** | **$1,372.0** | [Investment Activities](index=7&type=section&id=Investment%20Activities) The company manages an investment portfolio of mortgage-backed, asset-backed, U.S. Government agency, and corporate debt securities to balance risk, regulatory needs, and liquidity while seeking returns [Deposits and Other Sources of Funds](index=7&type=section&id=Deposits%20and%20Other%20Sources%20of%20Funds) Primary funding sources include diverse deposit products, loan repayments, and operational cash flow, supplemented by borrowings like FHLB advances, with total deposits reaching **$1.488 billion** at year-end 2024 Deposit Composition as of December 31, 2024 | Deposit Type | Amount (in billions) | | :--- | :--- | | Interest-bearing Deposits | $1.235 | | Non-interest bearing Deposits | $0.253 | | **Total Deposits** | **$1.488** | [Regulation and Supervision](index=7&type=section&id=Regulation%20and%20Supervision) Operating in a highly regulated industry, the company is supervised by the FRB, its bank by the OCC, with key regulatory areas including capital adequacy, AML, consumer compliance, and CRA * The Company is a bank holding company regulated by the FRB, and the Bank is a national bank regulated by the OCC[32](index=32&type=chunk) * The Bank must maintain a capital conservation buffer of **2.5% Common Equity Tier 1 (CET1) capital** to avoid restrictions on capital distributions, effectively increasing minimum capital ratios to **7.0% for CET1**, **8.5% for Tier 1**, and **10.5% for Total Capital**[45](index=45&type=chunk) * The Bank received a **"Satisfactory" rating** in its most recent Community Reinvestment Act (CRA) examination, though a final rule to amend CRA regulations issued in October 2023 faces delayed implementation due to a preliminary injunction[69](index=69&type=chunk)[70](index=70&type=chunk)[71](index=71&type=chunk) [Human Capital](index=13&type=section&id=Human%20Capital) The company prioritizes attracting, retaining, and developing its **232 total employees** (207 full-time as of March 13, 2025), none of whom are unionized * As of March 13, 2025, the company employed **207 full-time** and **232 total employees**, none subject to collective bargaining agreements[78](index=78&type=chunk) [Risk Factors](index=13&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company faces material risks across economic conditions, business operations, and regulatory compliance, including economic downturns, inflation, interest rate fluctuations, cybersecurity threats, and evolving banking regulations [Risks Related to Economic Conditions](index=13&type=section&id=RISKS%20RELATED%20TO%20ECONOMIC%20CONDITIONS) The company's performance is highly susceptible to economic conditions in Wisconsin and Minnesota, facing risks from inflation, geopolitical tensions, and the sensitivity of its concentrated commercial and agricultural lending portfolio * The company's financial condition is significantly impacted by economic conditions in its primary markets of Wisconsin and Minnesota[80](index=80&type=chunk) * Inflation poses a risk by increasing non-interest expenses and potentially impairing customers' ability to repay loans, with the annual inflation rate at **2.9%** as of December 2024[81](index=81&type=chunk) * The company faces higher lending risks from its commercial and agricultural loan portfolio, as repayment depends on the successful operation of underlying businesses and farms, sensitive to economic and external factors[83](index=83&type=chunk) [Risks Related to Business and Operations](index=14&type=section&id=RISKS%20RELATED%20TO%20OUR%20BUSINESS%20AND%20OPERATIONS) Operational risks include cybersecurity threats, interest rate risk impacting net interest income, intense competition, disintermediation, reliance on key personnel, and dividend payment limitations due to subsidiary bank regulations * The company is subject to significant cybersecurity risks due to its reliance on information systems and sensitive customer data, facing evolving threats from organized crime, hackers, and nation-state actors[86](index=86&type=chunk)[87](index=87&type=chunk) * Failures of other large financial institutions in 2023 could reduce customer confidence and negatively impact the banking industry, despite the company's strong liquidity and **82% insured or collateralized deposits** as of December 31, 2024[88](index=88&type=chunk) * The company's ability to pay dividends primarily depends on receiving dividends from its subsidiary Bank, subject to regulatory restrictions and the Bank's financial condition[115](index=115&type=chunk)[116](index=116&type=chunk)[117](index=117&type=chunk) [Regulatory and Compliance Risks](index=19&type=section&id=REGULATORY%20AND%20COMPLIANCE%20RISKS) Operating in a highly regulated environment, the company faces increased costs and operational impacts from changes in laws, regulations, and policies, alongside costly public company reporting obligations that may rise with filer status changes * The banking industry is extensively regulated, and changes in regulations or oversight could materially impact operations and profitability[122](index=122&type=chunk) * The company, currently a "smaller reporting company" and "non-accelerated filer," will likely become an "accelerated filer" in 2025, incurring more costly Section 404(b) Sarbanes-Oxley Act requirements for auditor attestation on internal controls[124](index=124&type=chunk) [Unresolved Staff Comments](index=20&type=section&id=ITEM%201B.%20UNRESOLVED%20STAFF%20COMMENTS) The company reports no unresolved staff comments from the SEC * None[128](index=128&type=chunk) [Cybersecurity](index=20&type=section&id=ITEM%201C.%20CYBERSECURITY) The company maintains a comprehensive cybersecurity program and governance framework, overseen by the Board's Risk Committee and led by a CISO and CTO, with no material incidents reported to date * Cybersecurity risk management is integrated into the company's enterprise risk management framework, overseen by the Board's Risk Committee[130](index=130&type=chunk)[133](index=133&type=chunk) * The Chief Information Security Officer (CISO) implements the cybersecurity program, reporting to the Risk Committee and providing regular updates to the Board[134](index=134&type=chunk)[135](index=135&type=chunk) * To date, the Company has not experienced a material cybersecurity incident[132](index=132&type=chunk) [Properties](index=22&type=section&id=ITEM%202.%20PROPERTIES) The company's main administrative office is leased in Eau Claire, WI, while its Bank operates **22 full-service branch offices** across Wisconsin and Minnesota, with **19 owned** and **3 leased** facilities deemed adequate * The Bank operates **22 branch offices**, of which **19 are owned** and **3 are leased**[137](index=137&type=chunk) [Legal Proceedings](index=22&type=section&id=ITEM%203.%20LEGAL%20PROCEEDINGS) The company and its bank subsidiary are occasionally involved in routine legal proceedings, with management believing any potential liability will not materially affect financial condition [Mine Safety Disclosures](index=22&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable * None[139](index=139&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=22&type=section&id=ITEM%205.%20MARKET%20FOR%20REGISTRANT'S%20COMMON%20EQUITY%2C%20RELATED%20STOCKHOLDER%20MATTERS%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) The company's common stock trades on NASDAQ under "CZWI", with **532 stockholders** as of March 13, 2025, and a stock repurchase program authorized in July 2024 resulted in **93,894 shares** repurchased in Q4 2024 * The company's common stock is traded on the NASDAQ Global Market under the symbol **"CZWI"**[139](index=139&type=chunk) Q4 2024 Share Repurchases | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | Oct 2024 | — | $ — | | Nov 2024 | 93,894 | $14.55 | | Dec 2024 | — | $ — | | **Total** | **93,894** | **$14.55** | * As of December 31, 2024, **238,000 shares** remained available for repurchase under the program authorized on July 25, 2024[145](index=145&type=chunk) [Reserved](index=23&type=section&id=ITEM%206.%20RESERVED) This item is reserved [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=ITEM%207.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Net income increased to **$13.75 million** in 2024, driven by a **$3.175 million** negative provision for credit losses and loan portfolio shrinkage, offsetting decreased net interest income and increased non-interest expenses, with total assets decreasing to **$1.75 billion** Key Performance Metrics (Year-End) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Net Income | $13.75 million | $13.06 million | | Diluted EPS | $1.34 | $1.25 | | Return on Average Assets (ROA) | 0.76% | 0.71% | | Return on Average Equity (ROE) | 7.84% | 7.87% | * A balance sheet optimization strategy in 2024 led to the runoff of non-strategic loans, with proceeds used to reduce more expensive borrowings and wholesale deposits[153](index=153&type=chunk) [Statement of Operations Analysis](index=26&type=section&id=Statement%20of%20Operations%20Analysis) In 2024, net interest income decreased to **$46.5 million** and net interest margin declined to **2.73%**, while a **$3.175 million** negative provision for credit losses was recorded, and non-interest expense increased by **$2.2 million** due to higher compensation Net Interest Income and Margin | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Net Interest Income | $46.5 million | $48.3 million | | Net Interest Margin | 2.73% | 2.81% | * A negative provision for credit losses of **$3.175 million** was recorded in 2024, largely due to improving economic forecasts and loan portfolio shrinkage, compared to **$0.475 million** in 2023[171](index=171&type=chunk) * Non-interest expense increased by **5.39%** to **$42.3 million**, primarily driven by a **$1.6 million (7.75%)** increase in compensation and related benefits[150](index=150&type=chunk)[179](index=179&type=chunk) [Balance Sheet Analysis](index=31&type=section&id=Balance%20Sheet%20Analysis) Total assets decreased by **$102.9 million** to **$1.75 billion** at year-end 2024 due to balance sheet optimization, reducing loans to **$1.37 billion** and borrowings by **$80.4 million**, while deposits modestly declined to **$1.49 billion** * Total assets decreased by **$102.9 million** to **$1.75 billion** at December 31, 2024[184](index=184&type=chunk) * Total loans decreased to **$1.37 billion** from **$1.46 billion**, resulting from a planned balance sheet optimization strategy involving the runoff of non-strategic loans[194](index=194&type=chunk) * FHLB advances decreased by **$74.5 million** to **$5.0 million** as of December 31, 2024, as proceeds from investment and loan portfolio shrinkage were used to reduce borrowings[242](index=242&type=chunk) * Uninsured and uncollateralized deposits totaled **$265.4 million**, representing **18% of total deposits**, at December 31, 2024[234](index=234&type=chunk)[249](index=249&type=chunk) [Capital Resources](index=50&type=section&id=Capital%20Resources) As of December 31, 2024, both the Company and the Bank exceeded "Well Capitalized" regulatory capital requirements, with the Bank's Tier 1 leverage ratio at **11.9%** and the Company's at **9.5%** Bank Capital Ratios as of Dec 31, 2024 | Ratio | Actual | Well Capitalized Minimum | | :--- | :--- | :--- | | Common Equity Tier 1 | 14.4% | 6.5% | | Tier 1 Capital | 14.4% | 8.0% | | Total Capital | 15.6% | 10.0% | | Tier 1 Leverage | 11.9% | 5.0% | Company (Holding Co.) Capital Ratios as of Dec 31, 2024 | Ratio | Actual | Regulatory Minimum | | :--- | :--- | :--- | | Common Equity Tier 1 | 11.4% | 4.5% | | Tier 1 Capital | 11.4% | 6.0% | | Total Capital | 16.1% | 8.0% | | Tier 1 Leverage | 9.5% | 4.0% | [Quantitative and Qualitative Disclosures About Market Risk](index=51&type=section&id=ITEM%207A.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company's primary market risk is interest rate risk, managed by ALCO through various strategies, with models showing a **3% decrease** in net interest income for a **+100 bp** rate shock and a **2% increase** for a **-100 bp** shock as of December 31, 2024 * The company's primary market risk is interest rate risk, managed by the Asset and Liability Management Committee (ALCO)[262](index=262&type=chunk)[265](index=265&type=chunk) Net Interest Income (NII) Sensitivity Analysis (at Dec 31, 2024) | Rate Shock (Basis Points) | % Change in NII (1-Year Horizon) | | :--- | :--- | | +300 bp | (8)% | | +200 bp | (5)% | | +100 bp | (3)% | | -100 bp | 2% | | -200 bp | 3% | Economic Value of Equity (EVE) Sensitivity Analysis (at Dec 31, 2024) | Rate Shock (Basis Points) | % Change in EVE | | :--- | :--- | | +300 bp | 2% | | +200 bp | 2% | | +100 bp | 1% | | -100 bp | (1)% | | -200 bp | (4)% | [Financial Statements and Supplementary Data](index=54&type=section&id=ITEM%208.%20FINANCIAL%20STATEMENTS%20AND%20SUPPLEMENTARY%20DATA) This section presents the company's audited consolidated financial statements for 2024 and 2023, including reports from Crowe LLP and Eide Bailly LLP, along with balance sheets, income statements, and cash flow statements * The financial statements for the year ended December 31, 2024, were audited by Crowe LLP[275](index=275&type=chunk) * The financial statements for the year ended December 31, 2023, were audited by Eide Bailly LLP[287](index=287&type=chunk) * A critical audit matter identified by Crowe LLP for the 2024 audit was the quantitative calculation of the Allowance for Credit Losses (ACL) on collectively evaluated loans, due to the complexity and subjectivity of models and assumptions[282](index=282&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=115&type=section&id=ITEM%209.%20CHANGES%20IN%20AND%20DISAGREEMENTS%20WITH%20ACCOUNTANTS%20ON%20ACCOUNTING%20AND%20FINANCIAL%20DISCLOSURE) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure * None[522](index=522&type=chunk) [Controls and Procedures](index=115&type=section&id=ITEM%209A.%20CONTROLS%20AND%20PROCEDURES) Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of December 31, 2024, with no material changes to internal control over financial reporting during the fiscal year * The CEO and CFO concluded that disclosure controls and procedures were effective as of December 31, 2024[524](index=524&type=chunk) * No material changes to internal control over financial reporting occurred during the fiscal year ended December 31, 2024[525](index=525&type=chunk) [Other Information](index=116&type=section&id=ITEM%209B.%20OTHER%20INFORMATION) During Q4 2024, no directors or Section 16 officers adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements [Disclosure Regarding Foreign Jurisdictions that Prevent Inspection](index=116&type=section&id=ITEM%209C.%20DISCLOSURE%20REGARDING%20FOREIGN%20JURISDICTIONS%20THAT%20PREVENT%20INSPECTION) This item is not applicable * None[527](index=527&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=117&type=section&id=ITEM%2010.%20DIRECTORS%2C%20EXECUTIVE%20OFFICERS%20AND%20CORPORATE%20GOVERNANCE) Information on directors, executive officers, and corporate governance, including Audit Committee members Timothy Olson (Chairman), Kristina Bourget, and Kathleen Skarvan, is incorporated by reference from the 2025 Proxy Statement [Executive Compensation](index=117&type=section&id=ITEM%2011.%20EXECUTIVE%20COMPENSATION) Information regarding director and executive compensation is incorporated by reference from the 2025 Proxy Statement [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=117&type=section&id=ITEM%2012.%20SECURITY%20OWNERSHIP%20OF%20CERTAIN%20BENEFICIAL%20OWNERS%20AND%20MANAGEMENT%20AND%20RELATED%20STOCKHOLDER%20MATTERS) Security ownership information is incorporated by reference from the 2025 Proxy Statement, with **52,000 shares** issuable from outstanding options and **34,053 shares** available for future issuance under approved equity plans as of December 31, 2024 Equity Compensation Plan Information as of Dec 31, 2024 | Plan Category | Shares to Be Issued Upon Exercise | Weighted-Average Exercise Price | Shares Available for Future Issuance | | :--- | :--- | :--- | :--- | | Approved by security holders | 52,000 | $11.62 | 34,053 | | Not approved by security holders | — | — | — | | **Total** | **52,000** | **$11.62** | **34,053** | [Certain Relationships and Related Transactions, and Director Independence](index=117&type=section&id=ITEM%2013.%20CERTAIN%20RELATIONSHIPS%20AND%20RELATED%20TRANSACTIONS%2C%20AND%20DIRECTOR%20INDEPENDENCE) Information regarding related party transactions and director independence is incorporated by reference from the 2025 Proxy Statement [Principal Accountant Fees and Services](index=118&type=section&id=ITEM%2014.%20PRINCIPAL%20ACCOUNTANT%20FEES%20AND%20SERVICES) Information regarding principal accountant fees and services is incorporated by reference from the 2025 Proxy Statement PART IV [Exhibits and Financial Statement Schedules](index=118&type=section&id=ITEM%2015.%20EXHIBITS%20AND%20FINANCIAL%20STATEMENT%20SCHEDULES) This section lists financial statements, schedules, and exhibits filed as part of the Form 10-K report, with financial statements in Item 8 and omitted schedules, providing a list of exhibits, many incorporated by reference

Earnings Performance - Citizens Community Bancorp, Inc. reported quarterly earnings of $0.27 per share, matching the Zacks Consensus Estimate, but down from $0.38 per share a year ago [1] - The company had previously expected to post earnings of $0.27 per share but actually reported $0.32, resulting in an 18.52% surprise [1] - Over the last four quarters, the company has surpassed consensus EPS estimates three times [1] Revenue Analysis - The company posted revenues of $13.72 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 2.02%, compared to $14.23 million in the same quarter last year [2] - Citizens Community Bancorp has topped consensus revenue estimates two times over the last four quarters [2] Stock Performance and Outlook - Citizens Community Bancorp shares have declined approximately 1.8% since the beginning of the year, while the S&P 500 has gained 3.7% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] Estimate Revisions - The trend for estimate revisions for Citizens Community Bancorp is mixed, leading to a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] - The current consensus EPS estimate for the upcoming quarter is $0.24 on revenues of $14.1 million, and for the current fiscal year, it is $1.31 on revenues of $60.9 million [7] Industry Context - The Financial - Savings and Loan industry, to which Citizens Community Bancorp belongs, is currently in the top 11% of over 250 Zacks industries, suggesting a favorable outlook [8]

[Earnings Summary and Corporate Developments](index=1&type=section&id=Citizens%20Community%20Bancorp%2C%20Inc.%20Reports%20Fourth%20Quarter%202024%20Earnings) The company reported Q4 2024 earnings, highlighting a decrease in net income but an increase in dividend, alongside strategic balance sheet optimization efforts that improved the tangible common equity ratio and net interest margin [Fourth Quarter 2024 Financial Highlights](index=1&type=section&id=Fourth%20Quarter%202024%20Financial%20Highlights) Citizens Community Bancorp reported Q4 2024 net income of $2.7 million, or $0.27 per diluted share, a decrease from both the prior quarter and the same quarter last year, influenced by higher net interest income and margin, offset by lower non-interest income and higher non-interest expenses, while increasing its annual dividend by 12.5% to $0.36 per share and improving its tangible common equity ratio Quarterly Earnings Comparison | Metric | Q4 2024 | Q3 2024 | Q4 2023 | | :--- | :--- | :--- | :--- | | Net Income | $2.7 million | $3.3 million | $3.7 million | | Diluted EPS | $0.27 | $0.32 | $0.35 | - The Board of Directors approved a **12.5% increase** in the annual dividend, raising it to **$0.36 per share**[1](index=1&type=chunk)[12](index=12&type=chunk) - Key changes from Q3 2024 include a **$0.4 million increase** in net interest income, a **$0.9 million decrease** in non-interest income (due to lower loan sale gains and losses on securities), and a **$0.4 million increase** in non-interest expense (due to higher REO expenses and professional fees)[2](index=2&type=chunk) Book Value Per Share Growth | Metric | Dec 31, 2024 | Sep 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | :--- | | Book Value Per Share | $17.94 | $17.88 | $16.60 | | Tangible Book Value Per Share (non-GAAP) | $14.69 | $14.64 | $13.42 | [Management Commentary and Strategic Objectives](index=1&type=section&id=Management%20Commentary%20and%20Strategic%20Objectives) Management expressed satisfaction with the execution of strategic objectives in 2024, focusing on balance sheet optimization, which increased the net interest margin and tangible common equity (TCE) ratio to 8.54%, while forecasting modest loan growth of 1-3% for 2025 and maintaining a strong credit loss reserve - The company is focused on balance sheet optimization, which led to a **6% increase** in net interest margin in Q4[3](index=3&type=chunk) - The Tangible Common Equity (TCE) ratio increased to **8.54%** from **8.35%** in the prior quarter, providing flexibility for future loan growth and potential share repurchases[3](index=3&type=chunk) - The company forecasts modest loan growth of **one to three percent** in 2025[3](index=3&type=chunk) - The company repurchased **94,000 shares** in Q4 2024 at an average price of **$14.55 per share**, and for the full year 2024, **476,000 shares** were repurchased at an average price of **$12.76**[12](index=12&type=chunk)[22](index=22&type=chunk) - The Faribault, Minnesota branch is scheduled to close on February 3, 2025, as part of the company's operational adjustments[12](index=12&type=chunk) [Financial Condition Analysis](index=3&type=section&id=Balance%20Sheet%20and%20Asset%20Quality) The company's financial condition reflects a decrease in total assets and loans due to strategic optimization, improved liquidity and asset quality, and a shift in the deposit mix away from wholesale funding [Balance Sheet Overview](index=3&type=section&id=Balance%20Sheet%20Overview) Total assets decreased by $50.6 million to $1.749 billion in Q4 2024, driven by a reduction in loans and securities, while on-balance sheet liquidity improved to 11.75% of total assets, and total borrowing capacity stood at $725 million, providing substantial coverage for uninsured deposits - Total assets decreased by **$50.6 million** during Q4 2024 to **$1.749 billion** at December 31, 2024[6](index=6&type=chunk) - Securities available for sale (AFS) decreased by **$6.6 million** to **$142.8 million**, while securities held to maturity (HTM) decreased by **$1.5 million** to **$85.5 million**[6](index=6&type=chunk)[7](index=7&type=chunk) - The on-balance sheet liquidity ratio improved to **11.75%** of total assets, up from **11.46%** in the prior quarter[8](index=8&type=chunk) - Total available borrowing capacity was **$725 million**, representing **273%** of uninsured and uncollateralized deposits[8](index=8&type=chunk) [Loan Portfolio and Asset Quality](index=3&type=section&id=Loan%20Portfolio%20and%20Asset%20Quality) The loan portfolio contracted by $55.8 million to $1.372 billion due to strategic pay-offs of non-strategic relationships, with asset quality metrics showing improvement as nonperforming assets decreased by $2.8 million to $14.3 million, and the allowance for credit losses (ACL) stood at 1.50% of total loans, with minimal net charge-offs - Loans decreased by **$55.8 million** during Q4 2024 to **$1.372 billion** as part of a balance sheet optimization strategy targeting non-strategic relationships[9](index=9&type=chunk) Allowance for Credit Losses (ACL) - Loans | Metric | Dec 31, 2024 | Sep 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | :--- | | ACL - Loans | $20.5 million | $21.0 million | $22.9 million | | ACL as % of Loans | 1.50% | 1.47% | 1.57% | - Net charge-offs were minimal at **0.009%** of average loans for Q4 and **0.007%** for the full year 2024[12](index=12&type=chunk) Criticized and Nonperforming Loan Trends (in thousands) | Loan Category | Dec 31, 2024 | Sep 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | :--- | | Special Mention Loans | $8,480 | $11,047 | $18,392 | | Substandard Loans | $18,891 | $21,202 | $19,596 | | Nonperforming Assets | $14,269 | $17,144 | $15,368 | [Deposit Portfolio and Liabilities](index=4&type=section&id=Deposit%20Portfolio%20and%20Liabilities) Total deposits decreased by $32.5 million to $1.49 billion, primarily due to a strategic reduction of $59.7 million in wholesale deposits, with brokered deposits significantly reduced by $47.5 million, and the deposit mix shifting towards a higher concentration of core consumer and commercial deposits, while FHLB advances were also paid down by $16.0 million - Total deposits decreased by **$32.5 million** to **$1.49 billion**, driven by a planned reduction in wholesale deposits[17](index=17&type=chunk) - Wholesale deposits decreased significantly, with brokered deposits falling by **$47.5 million** to **$19.1 million** at quarter-end[17](index=17&type=chunk) Deposit Portfolio Composition (Q4 2024 vs Q3 2024) | Deposit Type | Q4 2024 % | Q3 2024 % | | :--- | :--- | :--- | | Consumer | 57% | 55% | | Commercial | 28% | 27% | | Public | 13% | 12% | | Wholesale | 2% | 6% | - Federal Home Loan Bank (FHLB) advances were reduced by **$16.0 million**, totaling **$5.0 million** at December 31, 2024[21](index=21&type=chunk) [Review of Operations](index=5&type=section&id=Review%20of%20Operations) The company's operations in Q4 2024 saw an increase in net interest income and margin, a decrease in non-interest income, an increase in non-interest expense, and a lower provision for income taxes [Net Interest Income and Margin](index=5&type=section&id=Net%20Interest%20Income%20and%20Margin) Net interest income (NII) for Q4 2024 increased by $0.4 million from the prior quarter to $11.7 million, and the net interest margin (NIM) expanded by 16 basis points to 2.79%, benefiting from lower deposit costs and 3 basis points from accelerated deferred fee accretion on loan payoffs Net Interest Income and Margin Performance | Metric | Q4 2024 | Q3 2024 | Q4 2023 | | :--- | :--- | :--- | :--- | | Net Interest Income | $11.71M | $11.29M | $11.75M | | Net Interest Margin | 2.79% | 2.63% | 2.69% | - The increase in NII from Q3 2024 was primarily due to the increase in NIM, which was favorably impacted by **3 basis points** from deferred fee accretion on loan payoffs[23](index=23&type=chunk) [Non-Interest Income and Expense](index=6&type=section&id=Non-Interest%20Income%20and%20Expense) Non-interest income decreased by $0.9 million to $2.0 million compared to the prior quarter, mainly due to a $0.5 million lower gain on sale of loans and a $0.2 million higher net loss on equity securities, while non-interest expense rose by $0.4 million to $10.8 million, driven by increased professional fees and losses on repossessed assets, resulting in an efficiency ratio of 76% - Non-interest income decreased by **$0.9 million** from Q3 2024, primarily due to **$0.5 million** lower gain on sale of loans and **$0.2 million** higher net losses on equity securities[26](index=26&type=chunk) - Non-interest expense increased by **$0.4 million** from Q3 2024, largely due to a **$0.2 million** increase in professional fees and **$0.2 million** in losses on repossessed assets[27](index=27&type=chunk) - Compared to Q4 2023, non-interest expense was up **$0.6 million** due to higher compensation, losses on repossessed assets, and data processing costs[27](index=27&type=chunk) - The efficiency ratio was **76%** for Q4 2024, compared to **72%** for Q3 2024[12](index=12&type=chunk) [Provision for Income Taxes](index=6&type=section&id=Provision%20for%20Income%20Taxes) The provision for income taxes was $0.7 million in Q4 2024, down from $0.9 million in the previous quarter, reflecting lower pre-tax income, with an effective tax rate of 19.5% for the quarter Effective Tax Rate Comparison | Period | Effective Tax Rate | | :--- | :--- | | Q4 2024 | 19.5% | | Q3 2024 | 21.5% | | Q4 2023 | 20.9% | [Financial Statements and Non-GAAP Reconciliations](index=7&type=section&id=Financial%20Statements%20and%20Non-GAAP%20Reconciliations) This section presents the company's consolidated financial statements and provides detailed reconciliations for non-GAAP financial measures used to assess core operational performance and financial strength [Consolidated Financial Statements](index=9&type=section&id=Consolidated%20Financial%20Statements) This section provides the detailed unaudited Consolidated Balance Sheets as of December 31, 2024, and the Consolidated Statements of Operations for the three and twelve months ended December 31, 2024, which form the basis for the financial analysis presented in the report Consolidated Balance Sheet Highlights (in thousands) | Account | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Total Assets | $1,748,519 | $1,851,391 | | Loans receivable, net | $1,348,432 | $1,437,884 | | Total Deposits | $1,488,148 | $1,519,092 | | Total Stockholders' Equity | $179,084 | $173,334 | Consolidated Statement of Operations Highlights (in thousands) | Account (Twelve Months Ended) | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Net Interest Income | $46,474 | $48,349 | | Total Non-interest Income | $10,107 | $10,250 | | Total Non-interest Expense | $42,306 | $40,142 | | Net Income | $13,751 | $13,059 | [Non-GAAP Financial Measures and Reconciliations](index=7&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) The company uses several non-GAAP financial measures, including tangible book value per share, tangible common equity to tangible assets, and adjusted net income, to provide a clearer understanding of its core operational performance, with this section providing detailed reconciliations of these non-GAAP measures to their nearest GAAP equivalents - Management uses non-GAAP measures such as tangible book value, tangible common equity ratios, and adjusted net income to help investors assess financial strength and compare results across periods by eliminating the impact of goodwill, intangibles, and certain non-recurring expenses[31](index=31&type=chunk)[32](index=32&type=chunk) Tangible Common Equity to Tangible Assets (non-GAAP) | Date | Ratio | | :--- | :--- | | Dec 31, 2024 | 8.54% | | Sep 30, 2024 | 8.35% | | Dec 31, 2023 | 7.71% | Return on Average Tangible Common Equity (non-GAAP, annualized) | Period | Ratio | | :--- | :--- | | Q4 2024 | 7.72% | | Q3 2024 | 9.38% | | Q4 2023 | 11.29% | | FY 2024 | 10.03% |

Core Viewpoint - Citizens Community Bancorp, Inc. reported a decrease in earnings for the fourth quarter of 2024, with net income of $2.7 million and earnings per diluted share of $0.27, down from $3.3 million and $0.32 per diluted share in the previous quarter, and $3.7 million and $0.35 per diluted share in the same quarter of the previous year [1][5]. Financial Performance - The fourth quarter 2024 operating results showed a $0.4 million increase in net interest income, with a net interest margin increase of 16 basis points [2]. - Non-interest income decreased by $0.9 million primarily due to lower gains on loan sales and higher net losses on equity securities [2][6]. - Non-interest expense increased by $0.4 million to $10.8 million, attributed to higher professional fees and losses on repossessed assets [9][27]. Balance Sheet and Asset Quality - Total assets decreased by $50.6 million to $1.749 billion at December 31, 2024, with a notable decrease in securities available for sale [7][8]. - Loans receivable decreased by $55.8 million to $1.369 billion, primarily due to payoffs of non-strategic relationships [9][11]. - Nonperforming assets decreased to $14.3 million, down from $17.1 million in the previous quarter, largely due to a partial paydown on a nonaccrual loan [17]. Capital and Equity - Book value per share improved to $17.94 at December 31, 2024, compared to $17.88 at September 30, 2024, and $16.60 at December 31, 2023 [3]. - Tangible common equity ratio increased to 8.54% at December 31, 2024, from 8.35% in the prior quarter, providing flexibility for loan portfolio growth and share repurchases [4][3]. Deposits and Funding - Total deposits decreased by $32.5 million during the fourth quarter of 2024, with a significant reduction in wholesale brokered deposits [19]. - The deposit portfolio composition shifted, with consumer deposits making up 57% and wholesale deposits dropping to 2% [19]. Dividend Declaration - The Board of Directors declared a $0.36 per share annual dividend, marking a 12.5% increase, payable on February 21, 2025 [9].

Core Viewpoint - Citizens Community Bancorp, Inc. reported a decrease in earnings for the fourth quarter of 2024, with net income of $2.7 million and earnings per diluted share of $0.27, down from $3.3 million and $0.32 in the previous quarter, and $3.7 million and $0.35 in the same quarter last year [1][5]. Financial Performance - The fourth quarter 2024 saw a $0.4 million increase in net interest income, totaling $11.7 million, with a net interest margin increase of 16 basis points to 2.79% [2][5][24]. - Non-interest income decreased by $0.9 million to $2.0 million, primarily due to lower gains on loan sales and higher net losses on equity securities [2][27]. - Non-interest expenses increased by $0.4 million to $10.8 million, attributed to higher professional fees and losses on repossessed assets [2][27]. Balance Sheet and Asset Quality - Total assets decreased by $50.6 million to $1.749 billion, with a notable reduction in loans by $55.8 million to $1.372 billion, primarily from non-strategic relationships [6][9][13]. - The allowance for credit losses on loans decreased to $20.5 million, representing 1.50% of total loans [11][14]. - Nonperforming assets decreased to $14.3 million, down from $17.1 million in the previous quarter, largely due to a partial paydown on a nonaccrual loan [17][13]. Capital and Equity - Book value per share improved to $17.94, and tangible book value per share increased to $14.69, reflecting a 9.5% increase from the previous year [3][5]. - The tangible common equity ratio increased to 8.54%, providing flexibility for potential loan growth and share repurchases in 2025 [4][3]. Deposits and Funding - Total deposits decreased by $32.5 million to $1.49 billion, with a significant reduction in wholesale brokered deposits [13][19]. - The deposit portfolio composition shifted, with consumer deposits making up 57% and commercial deposits 28% as of December 31, 2024 [20][19]. Strategic Initiatives - The company executed a share repurchase program, buying back approximately 94 thousand shares at an average price of $14.55 per share during the fourth quarter [23][5]. - The company plans to close a branch in Faribault, Minnesota, with minimal associated costs recognized in the fourth quarter [13][5].

Core Viewpoint - The article emphasizes the importance of value investing and highlights Citizens Community Bancorp (CZWI) as a strong candidate for value investors due to its favorable valuation metrics and earnings outlook [2][4][7] Valuation Metrics - CZWI has a Zacks Rank of 2 (Buy) and a Value grade of A, indicating strong potential for value investors [4] - The stock's P/E ratio is 11.89, which is lower than the industry average of 13.74, suggesting it may be undervalued [4] - CZWI's P/S ratio is 1.61, compared to the industry's average P/S of 1.69, further indicating its relative undervaluation [5] - The P/CF ratio for CZWI is 8.50, significantly lower than the industry average of 11.25, reinforcing the notion of it being undervalued based on cash flow [6] Earnings Outlook - The article notes that CZWI's P/CF has fluctuated between 5.81 and 8.50 over the past year, with a median of 7.05, which reflects a solid cash outlook [6] - The overall strength of CZWI's earnings outlook positions it as one of the strongest value stocks in the market [7]

Core Viewpoint - The article emphasizes the importance of identifying sustainable trends in short-term investing to maximize profitability, highlighting the challenges investors face in maintaining momentum in stock prices [1][2]. Group 1: Stock Performance - Citizens Community Bancorp, Inc. (CZWI) has shown a solid price increase of 20.2% over the past 12 weeks, indicating strong investor interest [4]. - The stock has also increased by 14% in the last four weeks, suggesting that the upward trend is still intact [5]. - CZWI is currently trading at 98.5% of its 52-week high-low range, indicating a potential breakout [5]. Group 2: Fundamental Strength - CZWI holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises [6]. - The stock has an Average Broker Recommendation of 1 (Strong Buy), reflecting high optimism from the brokerage community regarding its near-term price performance [7]. Group 3: Investment Strategy - The "Recent Price Strength" screen is a useful tool for identifying stocks with sufficient fundamental strength to maintain their upward trends [3]. - The article suggests that investors should consider other stocks that pass through this screening process for potential investment opportunities [8].

Core Viewpoint - Citizens Community Bancorp, Inc. (CZWI) has received a Zacks Rank 2 (Buy) upgrade, indicating a positive outlook based on rising earnings estimates, which significantly influence stock prices [1][4]. Earnings Estimates and Revisions - The Zacks Consensus Estimate for Citizens Community Bancorp for the fiscal year ending December 2024 is projected at $1.34 per share, reflecting a 4.7% increase from the previous year's reported figure [9]. - Over the past three months, the Zacks Consensus Estimate for the company has risen by 3.1%, indicating a trend of increasing earnings estimates [9]. Zacks Rating System - The Zacks rating system is based solely on changes in a company's earnings picture, making it a reliable tool for investors to gauge stock performance [2][3]. - The system categorizes stocks into five groups, with Zacks Rank 1 (Strong Buy) stocks historically generating an average annual return of +25% since 1988 [8]. - Citizens Community Bancorp's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [11]. Market Impact - Rising earnings estimates and the corresponding rating upgrade signal an improvement in the company's underlying business, which is expected to positively influence its stock price [6]. - The correlation between earnings estimate revisions and near-term stock movements underscores the importance of tracking these revisions for investment decisions [7].

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.On top of the Zacks Rank, inv ...

Have you been paying attention to shares of Citizens Community Bancorp, Inc. (CZWI) ? Shares have been on the move with the stock up 2.1% over the past month. The stock hit a new 52-week high of $14.59 in the previous session. Citizens Community Bancorp, Inc. has gained 23% since the start of the year compared to the 24.1% move for the Zacks Finance sector and the 21.7% return for the Zacks Financial - Savings and Loan industry.What's Driving the Outperformance?The stock has an impressive record of positive ...