Core Viewpoint - The Bank of Glen Burnie has completed the acquisition of VA Wholesale Mortgage, Inc., which will enhance its mortgage business by expanding product offerings and geographical reach, particularly in serving military personnel and their families [1][2][3]. Company Overview - The Bank of Glen Burnie is a wholly owned subsidiary of Glen Burnie Bancorp, engaged in commercial and retail banking, with a focus on real estate financing and various loan products [7]. - VA Wholesale Mortgage, Inc. is a veteran-owned mortgage company specializing in VA home loans and other mortgage products, operating in multiple states [8]. Acquisition Details - The acquisition aims to provide a consistent source of capital for VA Wholesale Mortgage, allowing for growth and improved service delivery to customers [2][4]. - VA Wholesale Mortgage closed approximately $125 million in mortgage loans in 2024, indicating a strong operational foundation prior to the acquisition [3]. Strategic Benefits - The acquisition will enable The Bank of Glen Burnie to quickly expand its mortgage offerings, including FHA, VA, and first-time homebuyer mortgages, thereby better serving its growing customer base [3][5]. - The integration of VA Wholesale Mortgage will allow the Bank to take on administrative responsibilities, freeing up VAWM's team to focus on client service [2][4]. Market Positioning - The Bank of Glen Burnie is positioned to leverage VA Wholesale Mortgage's expertise in serving military personnel, which is a key differentiator in the mortgage lending market [5]. - The acquisition is expected to enhance the Bank's outreach to veterans and active-duty military personnel, expanding its customer base [5].

[PART I – FINANCIAL INFORMATION](index=3&type=section&id=Part%20I.%20FINANCIAL%20INFORMATION) This section provides the unaudited consolidated financial statements and management's discussion and analysis [ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements of Glen Burnie Bancorp and its subsidiary for the periods ended June 30, 2025, and December 31, 2024, including balance sheets, statements of income (loss), comprehensive income (loss), changes in stockholders' equity, and cash flows, along with accompanying notes detailing significant accounting policies, credit loss methodologies, investment securities, loan portfolio analysis, fair value measurements, recent accounting pronouncements, and subsequent events [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) This statement provides a snapshot of the Company's assets, liabilities, and equity at specific dates Consolidated Balance Sheet Highlights (dollars in thousands) | Metric (dollars in thousands) | June 30, 2025 | December 31, 2024 | Change ($) | Change (%) | | :---------------------------- | :------------ | :---------------- | :--------- | :--------- | | Total Assets | $350,721 | $358,956 | $(8,235) | (2.29)% | | Cash and Cash Equivalents | $12,668 | $24,464 | $(11,796) | (48.22)% | | Loans, net | $210,775 | $202,380 | $8,395 | 4.15% | | Total Deposits | $317,316 | $309,189 | $8,127 | 2.63% | | Short-term borrowings | $13,000 | $30,000 | $(17,000) | (56.67)% | | Total Stockholders' Equity | $18,933 | $17,817 | $1,116 | 6.26% | [Consolidated Statements of Income (Loss)](index=5&type=section&id=Consolidated%20Statements%20of%20Income%20(Loss)) This statement details the Company's revenues, expenses, and net loss over specific periods Consolidated Income Statement Highlights (dollars in thousands) | Metric (dollars in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total Interest Income | $3,877 | $3,893 | $7,506 | $7,298 | | Total Interest Expense | $1,141 | $1,107 | $2,207 | $1,941 | | Net Interest Income | $2,736 | $2,786 | $5,299 | $5,357 | | (Release) provision of credit loss allowance | $79 | $600 | $(541) | $792 | | Total Noninterest Income | $220 | $241 | $425 | $471 | | Total Noninterest Expenses | $3,252 | $2,820 | $6,516 | $5,658 | | Net Loss | $(212) | $(204) | $(59) | $(201) | | Basic and diluted net loss per share | $(0.07) | $(0.07) | $(0.02) | $(0.07) | [Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) This statement presents net loss and other comprehensive income (loss) components, reflecting total equity changes Consolidated Comprehensive Income (Loss) Highlights (dollars in thousands) | Metric (dollars in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss | $(212) | $(204) | $(59) | $(201) | | Other comprehensive income (loss) | $(36) | $(196) | $1,174 | $(1,137) | | Comprehensive income (loss) | $(248) | $(400) | $1,115 | $(1,338) | [Consolidated Statements of Changes in Stockholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) This statement outlines changes in each component of stockholders' equity over the period Consolidated Stockholders' Equity Changes (dollars in thousands) | Metric (dollars in thousands) | Balance, December 31, 2024 | Net Loss | Other Comprehensive Income | Balance, June 30, 2025 | | :---------------------------- | :------------------------- | :------- | :------------------------- | :--------------------- | | Common Stock | $2,901 | — | — | $2,901 | | Additional Paid-in Capital | $11,037 | — | — | $11,037 | | Retained Earnings | $22,882 | $(59) | — | $22,823 | | Accumulated Other Comprehensive Income (Loss) | $(19,003) | — | $1,174 | $(17,828) | | Total Stockholders' Equity | $17,817 | $(59) | $1,174 | $18,933 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This statement summarizes cash inflows and outflows from operating, investing, and financing activities Consolidated Cash Flow Highlights (dollars in thousands) | Metric (dollars in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------- | :----------------------------- | :----------------------------- | | Net cash (used in) provided by operating activities | $(356) | $259 |\n| Net cash used in investing activities | $(2,567) | $(3,998) | | Net cash (used in) provided by financing activities | $(8,873) | $5,284 | | Net (decrease) increase in cash and cash equivalents | $(11,796) | $1,545 | | Cash and cash equivalents at end of period | $12,668 | $16,786 | [Notes to Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) These notes provide detailed information on the Company's organizational structure, basis of financial statement presentation, significant accounting policies (including the CECL methodology for credit losses), loss per share calculations, investment securities portfolio, loan portfolio composition and credit quality, fair value measurements, recent accounting pronouncements, and a significant subsequent event regarding a planned acquisition [NOTE 1 – ORGANIZATIONAL](index=9&type=section&id=NOTE%201%20%E2%80%93%20ORGANIZATIONAL) This note describes Glen Burnie Bancorp's structure as a Maryland-based bank holding company and its subsidiary - Glen Burnie Bancorp is a Maryland-based bank holding company, owning The Bank of Glen Burnie, which provides financial services in Anne Arundel County and surrounding Central Maryland[18](index=18&type=chunk) [NOTE 2 – BASIS OF PRESENTATION](index=9&type=section&id=NOTE%202%20%E2%80%93%20BASIS%20OF%20PRESENTATION) This note outlines the basis for preparing unaudited interim financial statements, including GAAP and CECL methodology - The unaudited consolidated financial statements are prepared in conformity with U.S. GAAP for interim reporting, reflecting normal recurring adjustments. Operating results for the interim periods are not necessarily indicative of full-year results[19](index=19&type=chunk) - The Company applies ASU 2016-13 (ASC 326) for Allowance for Credit Losses (ACL), using the Current Expected Credit Loss (CECL) methodology, which estimates credit losses over the life of an exposure based on past events, current conditions, and reasonable forecasts[21](index=21&type=chunk)[22](index=22&type=chunk) - The loan portfolio is segmented into real estate, commercial and industrial, and consumer loans, with further disaggregation into classes for ACL determination. Historical loss experience, adjusted for current conditions and future forecasts, is the primary basis for CECL[23](index=23&type=chunk)[24](index=24&type=chunk)[25](index=25&type=chunk) - For Available for Sale (AFS) debt securities, the Company assesses impairment based on intent/requirement to sell and credit losses. As of June 30, 2025, unrealized losses in AFS securities were not deemed credit losses[29](index=29&type=chunk)[31](index=31&type=chunk) - Off-balance-sheet credit exposures, primarily unfunded loan commitments totaling **$37.3 million** as of June 30, 2025, have a reserve for expected lifetime credit losses recognized as a liability[32](index=32&type=chunk) [NOTE 3 – LOSS PER SHARE](index=15&type=section&id=NOTE%203%20%E2%80%93%20LOSS%20PER%20SHARE) This note details the calculation of basic and diluted loss per share for the reporting periods Loss Per Share Calculation (dollars) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss (dollars) | $(211,974) | $(204,480) | $(59,004) | $(201,322) | | Weighted average common shares outstanding | 2,900,681 | 2,891,203 | 2,891,585 | 2,888,378 | | Basic and diluted net loss per share | $(0.07) | $(0.07) | $(0.02) | $(0.07) | - Diluted EPS calculations were not required for the periods presented due to no outstanding stock options[39](index=39&type=chunk) [NOTE 4 – INVESTMENT SECURITIES](index=15&type=section&id=NOTE%204%20%E2%80%93%20INVESTMENT%20SECURITIES) This note provides information on the Company's available-for-sale investment securities, fair value, and unrealized losses - The Company holds no trading or held-to-maturity securities, only available-for-sale (AFS) investment securities, reported at fair value with unrealized gains/losses in other comprehensive income[40](index=40&type=chunk) AFS Investment Securities Summary (dollars in thousands) | Metric (dollars in thousands) | June 30, 2025 | December 31, 2024 | | :---------------------------- | :------------ | :---------------- | | Total AFS Securities (Fair Value) | $104,566 | $107,949 | | Total Amortized Cost | $129,163 | $134,166 | | Gross Unrealized Losses | $(24,610) | $(26,243) | - The Company does not believe the unrealized losses in AFS debt securities are due to credit impairment, as it does not intend to sell them before maturity or full recovery of amortized cost[43](index=43&type=chunk)[44](index=44&type=chunk)[45](index=45&type=chunk)[46](index=46&type=chunk) [NOTE 5 – LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES](index=18&type=section&id=NOTE%205%20%E2%80%93%20LOANS%20RECEIVABLE%20AND%20ALLOWANCE%20FOR%20CREDIT%20LOSSES) This note details the loan portfolio composition, credit quality, and the allowance for credit losses - The loan portfolio is diversified across real estate, commercial and industrial, and consumer segments, with credit risk managed through diversification and specific portfolio segment/class evaluations[50](index=50&type=chunk)[51](index=51&type=chunk)[53](index=53&type=chunk) Loan Portfolio Composition (dollars in thousands) | Loan Segment (dollars in thousands) | June 30, 2025 (Amount) | June 30, 2025 (%) | December 31, 2024 (Amount) | December 31, 2024 (%) | | :---------------------------------- | :--------------------- | :---------------- | :------------------------- | :-------------------- | | Loans Secured by Real Estate | $164,681 | 77% | $161,938 | 79% | | Commercial and Industrial | $24,551 | 11% | $22,396 | 11% | | Consumer Loans | $24,130 | 11% | $20,885 | 10% | | Total Loans, net of deferred fees and costs | $213,362 | 100% | $205,219 | 100% | | Less: Allowance for credit losses | $(2,587) | | $(2,839) | | Allowance for Credit Losses and Asset Quality Metrics (dollars in thousands) | Metric (dollars in thousands) | June 30, 2025 | December 31, 2024 | | :---------------------------- | :------------ | :---------------- | | Allowance for credit losses | $2,587 | $2,839 | | Net charge-offs to average loans (annualized) | 0.01% | 0.25% | | Nonaccrual loans | $1,066 | $360 | | Restructured loans to borrowers with financial difficulty | $24 | $26 | | Non-performing assets to total assets | 0.30% | 0.10% | - The Company utilizes an internal risk rating scale (1-8) for loan asset quality, classifying loans as Pass (1-4), Special Mention (5), Substandard (6), Doubtful (7), or Loss (8)[74](index=74&type=chunk)[75](index=75&type=chunk)[76](index=76&type=chunk)[77](index=77&type=chunk)[78](index=78&type=chunk)[79](index=79&type=chunk) [NOTE 6 – FAIR VALUE](index=29&type=section&id=NOTE%206%20%E2%80%93%20FAIR%20VALUE) This note explains the fair value measurement hierarchy for investment securities and impaired loans - Fair value measurements are categorized into a three-level hierarchy based on observability of inputs: Level 1 (quoted prices in active markets), Level 2 (other significant observable inputs), and Level 3 (significant unobservable inputs)[83](index=83&type=chunk)[87](index=87&type=chunk) - Investment securities available for sale are primarily Level 1 and Level 2. Impaired loans, valued on a non-recurring basis, are classified as Level 3, relying on independent appraisals discounted based on individual circumstances[84](index=84&type=chunk)[86](index=86&type=chunk) Fair Value Measurements by Level (dollars in thousands) | Metric (dollars in thousands) | Level 1 | Level 2 | Level 3 | Fair Value | | :---------------------------- | :------ | :------ | :------ | :--------- | | **June 30, 2025** | | | | | | Securities available for sale | $13,650 | $90,916 | $— | $104,566 | | Impaired loans | $— | $— | $2,418 | $2,418 | | **December 31, 2024** | | | | | | Securities available for sale | $14,188 | $93,761 | $— | $107,949 | | Impaired loans | $— | $— | $994 | $994 | [NOTE 7 – RECENT ACCOUNTING PRONOUNCEMENTS](index=33&type=section&id=NOTE%207%20%E2%80%93%20RECENT%20ACCOUNTING%20PRONOUNCEMENTS) This note confirms no material impact from new accounting pronouncements during the quarter - No new accounting pronouncements issued or effective during the quarter ended June 30, 2025, had a material effect on the Company's financial statements and disclosures[96](index=96&type=chunk) [NOTE 8 – SUBSEQUENT EVENTS](index=33&type=section&id=NOTE%208%20%E2%80%93%20SUBSEQUENT%20EVENTS) This note discloses a planned acquisition of Virginia Wholesale Mortgage, Inc. expected to close in August 2025 - On March 5, 2025, the Bank entered into a stock purchase agreement with Virginia Wholesale Mortgage, Inc. (VAWM), a mortgage banking services provider. The acquisition is expected to close in August 2025, providing access to new products, markets, off-balance sheet mortgage origination/sales, and cross-selling opportunities[97](index=97&type=chunk)[98](index=98&type=chunk) [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=35&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and operating results, including forward-looking statements, an overview of key performance measures, recent industry events, detailed comparisons of financial performance for the three and six months ended June 30, 2025, versus 2024, an analysis of financial condition, market risk, liquidity, capital resources, and critical accounting policies [CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS](index=35&type=section&id=CAUTIONARY%20STATEMENT%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This statement warns that the report contains forward-looking statements subject to various risks and uncertainties - The report contains forward-looking statements subject to various risks and uncertainties, including credit losses, real estate market weaknesses, regulatory restrictions, interest rate changes, cybersecurity risks, and economic conditions[99](index=99&type=chunk) - Actual future results may differ materially from anticipated results due to factors beyond the Company's control, and past performance is not indicative of future results[99](index=99&type=chunk)[100](index=100&type=chunk) [OVERVIEW](index=37&type=section&id=OVERVIEW) This section provides an overview of the Company's primary income sources and key performance measures - The Company's primary income source is interest from loans and investments, with key success measures being net interest income (difference between interest earned and paid) and net interest spread[102](index=102&type=chunk) - An Allowance for Credit Losses (ACL) is maintained to absorb estimated expected credit losses on existing loans, established through a provision for or release of credit losses against earnings[102](index=102&type=chunk)[105](index=105&type=chunk) [RECENT INDUSTRY EVENTS](index=39&type=section&id=RECENT%20INDUSTRY%20EVENTS) This section discusses the impact of Federal Reserve monetary policies and market interest rate changes - Federal Reserve monetary policies significantly impact bank operations; the target range of federal funds decreased by **100 basis points** from June 30, 2024, to June 30, 2025 (from 5.25%-5.50% to 4.25%-4.50%)[108](index=108&type=chunk) - Changes in market interest rates affect income/expense on interest-earning assets and liabilities, market value of short-term assets, and mortgage origination income[108](index=108&type=chunk) [COMPARISON OF RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED JUNE 30, 2025, TO THE THREE MONTHS ENDED JUNE 30, 2024](index=39&type=section&id=COMPARISON%20OF%20RESULTS%20OF%20OPERATIONS%20FOR%20THE%20THREE%20MONTHS%20ENDED%20JUNE%2030%2C%202025%2C%20TO%20THE%20THREE%20MONTHS%20ENDED%20JUNE%2030%2C%202024) For the three months ended June 30, 2025, the Company reported a net loss of $(212) thousand, a slight increase from $(204) thousand in the prior year. This was driven by decreased net interest income and non-interest income, and increased non-interest expenses, partially offset by an improved provision for credit losses [Net Income](index=39&type=section&id=Net%20Income_Q2) This section analyzes the Company's net loss and effective tax rate for the second quarter Net Income Highlights (dollars in thousands) | Metric (dollars in thousands) | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :---------------------------- | :------ | :------ | :--------- | :--------- | | Net Loss | $(212) | $(204) | $(8) | 3.92% | | Basic and Diluted EPS | $(0.07) | $(0.07) | $0.00 | 0.00% | - The net loss increased by **$8 thousand**, primarily due to a **$50 thousand** decrease in net interest income and a **$432 thousand** increase in non-interest expenses, partially offset by a **$521 thousand** improvement in credit loss provision[109](index=109&type=chunk) - The effective tax rate was **43.5%** in Q2 2025, down from **48.1%** in Q2 2024, influenced by a high proportion of tax-exempt income relative to the pre-tax book loss[110](index=110&type=chunk) [Net Interest Income](index=41&type=section&id=Net%20Interest%20Income_Q2) This section examines changes in net interest income, net interest margin, and earning asset yields for the second quarter Net Interest Income Analysis (dollars in thousands) | Metric | Q2 2025 | Q2 2024 | Change | | :---------------------------- | :------ | :------ | :----- | | Net Interest Income (dollars in thousands) | $2,736 | $2,786 | $(50) | | Net Interest Margin (FTE) | 3.13% | 3.10% | 0.03% | | Average Earning Assets (dollars in millions) | $359.3 | $370.9 | $(11.6)| | Earning Asset Yield | 4.33% | 4.22% | 0.11% | | Cost of Interest-Bearing Liabilities | 1.99% | 1.90% | 0.09% | - The **$50 thousand** decrease in net interest income was due to a **$16 thousand** reduction in total interest income and a **$34 thousand** increase in the total cost of funds[112](index=112&type=chunk) - The earning asset yield increased by **11 basis points** due to a shift in earning asset mix from cash and securities (down **$17.5 million**) to loans (up **$22.3 million**), with loans representing **58%** of average earning assets in Q2 2025, up from **50%** in Q2 2024[112](index=112&type=chunk) [Provision and Allowance for Credit Losses](index=44&type=section&id=Provision%20and%20Allowance%20for%20Credit%20Losses_Q2) This section analyzes the provision for credit loss allowance and its components for the second quarter Credit Loss Provision and Allowance (dollars in thousands) | Metric (dollars in thousands) | Q2 2025 | Q2 2024 | | :---------------------------- | :------ | :------ | | Provision for Credit Loss Allowance | $79 | $600 | | ACL for Loans (Release)/Provision | $(57) | $526 | | ACL for Unfunded Commitments (Provision) | $136 | $74 | - The provision for credit loss allowance significantly improved by **$521 thousand**, primarily driven by a release of ACL for loans in Q2 2025 compared to a provision in Q2 2024[115](index=115&type=chunk) [Non-interest Income and Non-interest Expense](index=44&type=section&id=Non-interest%20Income%20and%20Non-interest%20Expense_Q2) This section reviews changes in non-interest income and expenses, including salary and benefits, for the second quarter Non-interest Income and Expense (dollars in thousands) | Metric (dollars in thousands) | Q2 2025 | Q2 2024 | Change ($) | | :---------------------------- | :------ | :------ | :--------- | | Non-interest Income | $220 | $241 | $(21) | | Non-interest Expense | $3,252 | $2,820 | $432 | | Salary and benefits | $2,026 | $1,601 | $425 | | Occupancy and equipment expenses | $256 | $338 | $(82) | - Non-interest income decreased by **$21 thousand** due to lower other fees and commissions (e.g., ATM usage, interchange fees)[116](index=116&type=chunk) - Non-interest expense increased by **$432 thousand**, mainly due to a **$425 thousand** rise in salary and benefits from new hires and non-recurring early retirement/headcount reduction costs, partially offset by an **$82 thousand** decrease in occupancy expenses from office closures[117](index=117&type=chunk)[118](index=118&type=chunk) [Comprehensive Income (Loss)](index=44&type=section&id=Comprehensive%20Income%20(Loss)_Q2) This section analyzes the comprehensive loss, including the impact of unrealized gains/losses on securities, for the second quarter Comprehensive Income (Loss) Highlights (dollars in thousands) | Metric (dollars in thousands) | Q2 2025 | Q2 2024 | Change ($) | | :---------------------------- | :------ | :------ | :--------- | | Comprehensive Loss | $(248) | $(400) | $152 | - The comprehensive loss decreased by **$152 thousand**, primarily due to a **$160 thousand** net-of-tax decrease in unrealized losses on securities, despite an **$8 thousand** increase in net loss[117](index=117&type=chunk) [COMPARISON OF RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED JUNE 30, 2025, TO THE SIX MONTHS ENDED JUNE 30,2024](index=45&type=section&id=COMPARISON%20OF%20RESULTS%20OF%20OPERATIONS%20FOR%20THE%20SIX%20MONTHS%20ENDED%20JUNE%2030%2C%202025%2C%20TO%20THE%20SIX%20MONTHS%20ENDED%20JUNE%2030%2C2024) For the six months ended June 30, 2025, the Company significantly reduced its net loss to $(59) thousand from $(201) thousand in the prior year. This improvement was mainly driven by a substantial improvement in the provision for credit losses, partially offset by decreased net interest income and non-interest income, and increased non-interest expenses [Net Income](index=45&type=section&id=Net%20Income_H1) This section analyzes the Company's net loss and income tax benefit for the first half of the year Net Income Highlights (dollars in thousands) | Metric (dollars in thousands) | H1 2025 | H1 2024 | Change ($) | Change (%) | | :---------------------------- | :------ | :------ | :--------- | :--------- | | Net Loss | $(59) | $(201) | $(142) | (70.65)% | | Basic and Diluted EPS | $(0.02) | $(0.07) | $(0.05) | (71.43)% | - The net loss decreased by **$142 thousand**, primarily due to a **$1.3 million** improvement in credit loss provision, partially offset by a **$58 thousand** decrease in net interest income and an **$858 thousand** increase in non-interest expenses[122](index=122&type=chunk) - The income tax benefit decreased from **$420 thousand** in H1 2024 to **$192 thousand** in H1 2025, reflecting tax deferrals from losses, changes in market rates, and the mix of tax-exempt income[122](index=122&type=chunk) [Net Interest Income](index=45&type=section&id=Net%20Interest%20Income_H1) This section examines changes in net interest income, net interest margin, and earning asset yields for the first half of the year Net Interest Income Analysis (dollars in thousands) | Metric | H1 2025 | H1 2024 | Change | | :---------------------------- | :------ | :------ | :----- | | Net Interest Income (dollars in thousands) | $5,299 | $5,357 | $(58) | | Net Interest Margin (FTE) | 3.06% | 3.02% | 0.04% | | Average Earning Assets (dollars in millions) | $357.7 | $366.5 | $(8.8) |\n| Earning Asset Yield | 4.23% | 4.00% | 0.23% | | Cost of Interest-Bearing Liabilities | 1.94% | 1.71% | 0.23% | - The **$58 thousand** decrease in net interest income resulted from a **$208 thousand** increase in total interest income being outpaced by a **$266 thousand** increase in the total cost of funds[123](index=123&type=chunk) - The earning asset yield increased by **23 basis points**, driven by a strategic shift from lower-yielding cash and securities (down **$24.0 million**) to higher-yielding loans (up **$26.1 million**), with loans comprising **58%** of average earning assets in H1 2025, up from **49%** in H1 2024[123](index=123&type=chunk)[124](index=124&type=chunk) [Provision and Allowance for Credit Losses](index=49&type=section&id=Provision%20and%20Allowance%20for%20Credit%20Losses_H1) This section analyzes the provision for credit loss allowance and its components for the first half of the year Credit Loss Provision and Allowance (dollars in thousands) | Metric (dollars in thousands) | H1 2025 | H1 2024 | | :---------------------------- | :------ | :------ | | (Release)/Provision for Credit Loss Allowance | $(541) | $792 | | ACL for Loans (Release)/Provision | $(203) | $694 | | ACL for Unfunded Commitments (Release)/Provision | $(338) | $97 | - The Company recorded a **$541 thousand** release for credit loss allowance in H1 2025, a significant improvement compared to a **$792 thousand** provision in H1 2024, reflecting releases for both loans and unfunded commitments[127](index=127&type=chunk) [Non-interest Income and Non-interest Expense](index=49&type=section&id=Non-interest%20Income%20and%20Non-interest%20Expense_H1) This section reviews changes in non-interest income and expenses, including salary and benefits, for the first half of the year Non-interest Income and Expense (dollars in thousands) | Metric (dollars in thousands) | H1 2025 | H1 2024 | Change ($) | | :---------------------------- | :------ | :------ | :--------- | | Non-interest Income | $425 | $471 | $(46) | | Non-interest Expense | $6,516 | $5,658 | $858 | | Salary and benefits | $3,853 | $3,219 | $634 | | Legal, accounting, other professional fees | $662 | $502 | $160 | | Occupancy and equipment expenses | $565 | $669 | $(104) | - Non-interest income decreased by **$46 thousand**, primarily due to lower other fees and commissions (**$38 thousand**) and reduced service charges on deposit accounts (**$8 thousand**)[128](index=128&type=chunk) - Non-interest expense increased by **$858 thousand**, driven by a **$634 thousand** rise in salary and benefits (new hires, early retirement costs) and a **$160 thousand** increase in legal/accounting fees (internal audit, new credit card program), partially offset by a **$104 thousand** decrease in occupancy expenses due to office closures[129](index=129&type=chunk)[132](index=132&type=chunk) [Comprehensive Income (Loss)](index=49&type=section&id=Comprehensive%20Income%20(Loss)_H1) This section analyzes the comprehensive income (loss), including the impact of unrealized gains/losses on securities, for the first half of the year Comprehensive Income (Loss) Highlights (dollars in thousands) | Metric (dollars in thousands) | H1 2025 | H1 2024 | Change ($) | | :---------------------------- | :------ | :------ | :--------- | | Comprehensive Income (Loss) | $1,115 | $(1,338) | $2,453 | - Comprehensive income improved by **$2.5 million**, shifting from a loss of **$1.3 million** in H1 2024 to an income of **$1.1 million** in H1 2025, primarily due to a **$2.3 million** net-of-tax increase in unrealized income on securities[130](index=130&type=chunk) [FINANCIAL CONDITION](index=49&type=section&id=FINANCIAL%20CONDITION) The Company's total assets decreased by $8.2 million to $351.0 million as of June 30, 2025, primarily due to a significant decrease in cash and cash equivalents, partially offset by loan growth. Stockholders' equity increased due to lower unrealized losses on available-for-sale securities. Asset quality metrics show an increase in nonaccrual loans and nonperforming assets Financial Condition Highlights (dollars in millions) | Metric (dollars in millions) | June 30, 2025 | December 31, 2024 | Change ($) | Change (%) | | :--------------------------- | :------------ | :---------------- | :--------- | :--------- | | Total Assets | $351.0 | $358.9 | $(7.9) | (2.20)% | | Cash and Cash Equivalents | $12.7 | $24.5 | $(11.8) | (48.16)% | | Loan Portfolio | $213.4 | $205.2 | $8.2 | 3.99% | | Investment Securities AFS | $104.6 | $107.9 | $(3.3) | (3.06)% | | Allowance for Credit Losses | $2.59 | $2.84 | $(0.25) | (8.80)% | | Total Deposits | $317.3 | $309.2 | $8.1 | 2.62% | | Short-term Borrowings | $13.0 | $30.0 | $(17.0) | (56.67)% | | Stockholders' Equity | $18.9 | $17.8 | $1.1 | 6.18% | Return and Book Value Metrics | Metric | June 30, 2025 | December 31, 2024 | | :---------------------------- | :------------ | :---------------- | | Return on average assets (3-month) | -0.24% | -0.22% | | Return on average assets (6-month) | -0.03% | -0.11% | | Return on average equity (3-month) | -4.30% | -4.72% | | Return on average equity (6-month) | -0.61% | -2.22% | | Book value per share | $6.53 | $6.14 | Asset Quality Metrics (dollars in thousands) | Metric (dollars in thousands) | June 30, 2025 | December 31, 2024 | | :---------------------------- | :------------ | :---------------- | | Nonaccrual loans | $1,066 | $360 | | Total nonperforming loans | $1,066 | $360 | | Total nonperforming assets | $1,066 | $360 | | Nonperforming assets to total assets | 0.30% | 0.10% | - Total deposits increased by **$8.1 million**, with noninterest-bearing deposits increasing by **6.23%** and money market deposits increasing by **14.93%**, while checking and savings deposits decreased[142](index=142&type=chunk) [MARKET RISK AND INTEREST RATE SENSITIVITY](index=55&type=section&id=MARKET%20RISK%20AND%20INTEREST%20RATE%20SENSITIVITY) The Company's primary market risk is interest rate fluctuation, managed by the Asset Liability Committee (ALCO) to optimize stockholder value and profitability. Simulation analysis indicates a modest asset-sensitive position in falling rate scenarios and a liability-sensitive position in rising rate scenarios, with measures of net interest income and economic value of equity at risk remaining within policy limits - Interest rate risk, arising from timing differences in rate changes and cash flows, is managed by the ALCO to maximize stockholder value and protect against adverse financial consequences[147](index=147&type=chunk)[148](index=148&type=chunk) - Simulation analysis at June 30, 2025, shows the Bank is modestly asset sensitive in falling rate scenarios and liability sensitive in rising rate scenarios, aiming to maintain a consistent spread between asset yields and funding costs[153](index=153&type=chunk)[155](index=155&type=chunk) Estimated Changes in Net Interest Income | Estimated Changes in Net Interest Income | -200 bp | -100 bp | +100 bp | +200 bp | | :--------------------------------------- | :------ | :------ | :------ | :------ | | Policy Limit | (15)% | (10)% | (10)% | (15)% | | June 30, 2025 | — % | (1)% | (2)% | (7)% | | June 30, 2024 | (5)% | (3)% | 1 % | — % | Estimated Changes in Economic Value of Equity (EVE) | Estimated Changes in Economic Value of Equity (EVE) | -200 bp | -100 bp | +100 bp | +200 bp | | :-------------------------------------------------- | :------ | :------ | :------ | :------ | | Policy Limit | (20)% | (10)% | (10)% | (20)% | | June 30, 2025 | 8 % | 4 % | (7)% | (17)% | | June 30, 2024 | 10 % | 6 % | (6)% | (15)% | [LIQUIDITY AND CAPITAL RESOURCES](index=58&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) The Company maintains strong liquidity and capital positions. Its primary liquidity sources are cash, dividends from the Bank, and principal/interest payments on loans and investments. The Bank has access to significant credit lines and maintains capital ratios well above regulatory 'well-capitalized' requirements, demonstrating ample capacity for future growth - The Bank's cash and cash equivalents decreased by **$11.8 million** (**48.2%**) to **$12.7 million** at June 30, 2025, from **$24.5 million** at December 31, 2024[164](index=164&type=chunk) - The Bank has access to an **$89.5 million** line of credit from FHLB of Atlanta, with **$13.0 million** outstanding at June 30, 2025 (down from **$30.0 million** at year-end 2024), and two unsecured federal funds lines of credit totaling **$17.0 million** with no outstanding balance[165](index=165&type=chunk)[166](index=166&type=chunk) - Stockholders' equity increased by **$1.1 million** (**6.3%**) during the six-month period, primarily due to a **$1.2 million** decrease in after-tax net unrealized holding loss on AFS securities[166](index=166&type=chunk) Capital Ratios | Capital Ratio | June 30, 2025 | December 31, 2024 | Well Capitalized Threshold | | :---------------------------- | :------------ | :---------------- | :------------------------- | | Common equity Tier 1 | 14.91% | 15.15% | 6.50% | | Total capital | 16.06% | 16.40% | 10.00% | | Tier 1 capital | 14.91% | 15.15% | 8.00% | | Tier 1 leverage | 9.59% | 9.97% | 5.00% | - The Bank remains well above all 'well-capitalized' regulatory requirement levels, demonstrating strong capital and liquidity positions[137](index=137&type=chunk)[172](index=172&type=chunk) [CRITICAL ACCOUNTING POLICIES AND ESTIMATES](index=61&type=section&id=CRITICAL%20ACCOUNTING%20POLICIES%20AND%20ESTIMATES) Management's determination of the Allowance for Credit Losses (ACL) is a critical accounting estimate, requiring significant judgment based on credit risk, expected future cash flows, historical loss rates, and quantitative/qualitative evaluations of past events, current conditions, and reasonable forecasts. The CECL methodology, adopted in 2020, introduces potential volatility to the ACL and reported earnings - The Allowance for Credit Losses (ACL) is a critical accounting estimate, relying on credit risk assessment, estimates of future cash flows, historical loss rates, and forecasts of economic conditions[175](index=175&type=chunk)[179](index=179&type=chunk) - The CECL methodology, adopted in 2020, requires immediate recognition of expected credit losses over the life of an exposure, replacing the 'incurred loss' approach[176](index=176&type=chunk)[177](index=177&type=chunk)[178](index=178&type=chunk) - Material changes in loan portfolio composition, characteristics, quality, economic conditions, and forecasts can lead to greater volatility in the ACL and reported earnings under CECL[180](index=180&type=chunk) [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=64&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) As a 'smaller reporting company,' Glen Burnie Bancorp is not required to provide disclosures under this item - The Company is a 'smaller reporting company' and is therefore not required to provide disclosures regarding quantitative and qualitative market risk[182](index=182&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=64&type=section&id=Item%204.%20Controls%20and%20Procedures) The Company's disclosure controls and procedures were not effective as of June 30, 2025, due to a material weakness related to the lack of a comprehensive control framework for CECL model inputs, assumptions, and results validation. Despite this, management concluded that the financial statements are fairly stated. Remediation efforts include hiring an experienced Chief Credit Officer and implementing new CECL controls, while a previously reported material weakness regarding segregation of duties for journal entries has been remediated - The Company's disclosure controls and procedures were not effective as of June 30, 2025[185](index=185&type=chunk) - A material weakness was identified: management has not fully implemented a comprehensive control framework to ensure key CECL model inputs, assumptions, and results are appropriately validated, documented, and assessed for reasonableness, and third-party data was relied upon without appropriate verification[185](index=185&type=chunk) - Remediation efforts include hiring an experienced Chief Credit Officer (effective March 31, 2025) and implementing numerous controls to address the CECL control gap[187](index=187&type=chunk) - A previously reported material weakness concerning segregation of duties for journal entries has been remediated through the implementation of system-based controls requiring secondary review and approval[189](index=189&type=chunk)[191](index=191&type=chunk) [PART II – OTHER INFORMATION](index=66&type=section&id=Part%20II.%20OTHER%20INFORMATION) This section provides additional information, including legal proceedings, risk factors, and exhibits [ITEM 1. LEGAL PROCEEDINGS](index=66&type=section&id=Item%201.%20Legal%20Proceedings) The Company is involved in litigation in the normal course of business but does not anticipate that the ultimate liability will have a material effect on its financial condition, operating results, or liquidity - The Company is party to litigation in the normal course of business, but management does not anticipate a material effect on financial condition, operating results, or liquidity[195](index=195&type=chunk) [ITEM 1A. RISK FACTORS](index=66&type=section&id=Item%201%20A.%20Risk%20Factors) This item is not applicable to the Company - This item is not applicable[196](index=196&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=66&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities or use of proceeds to report - None to report[197](index=197&type=chunk) [ITEM 3. DEFAULTS UPON SENIOR SECURITIES](index=66&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities to report - None to report[198](index=198&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES](index=66&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the Company - This item is not applicable[199](index=199&type=chunk) [ITEM 5. OTHER INFORMATION](index=66&type=section&id=Item%205.%20Other%20Information) There is no other information to report under this item - None to report[200](index=200&type=chunk) [ITEM 6. EXHIBITS](index=68&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including organizational documents, equity plans, severance plans, deferred compensation plans, certifications, and XBRL-related documents - The exhibits include Articles of Incorporation, By-Laws, Description of Registrant's Securities, Director Stock Purchase Plan, Employee Stock Purchase Plan, Change-in-Control Severance Plan, Executive and Director Deferred Compensation Plan, Rule 15d-14(a) Certifications, Section 1350 Certifications, and Inline XBRL documents[201](index=201&type=chunk)

Executive Summary & Highlights [Second Quarter 2025 Performance Overview](index=1&type=section&id=Second%20Quarter%202025%20Performance%20Overview) Glen Burnie Bancorp reported a **net loss of $212,000** for Q2 2025, or $(0.07) diluted EPS, despite net interest margin expansion, loan growth, and stable deposits, with strategic initiatives underway Key Performance Metrics | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :-------------------------------- | :------ | :------ | :------ | | Net (Loss) Income | $(212,000) | $153,000 | $(204,000) | | Diluted (Loss) Earnings Per Share | $(0.07) | $0.05 | $(0.07) | | Net Interest Margin (tax equivalent) (%) | 3.13% | 3.00% | - | | Total Loans Increase (QoQ) | $6.0 million | - | - | | Annualized Loan Growth Rate (%) | 11.5% | - | - | | Total Deposits (as of June 30, 2025) | $317.3 million | - | - | | Net Charge-offs (Q2 2025) | $45,000 | $4,000 | - | | Annualized Net Charge-offs Rate (%) | 0.09% | 0.01% | - | - The Bank entered into a stock purchase agreement with **VA Wholesale Mortgage, Inc. (VAWM)** on March 5, 2025, expected to close in August 2025, aiming to provide **access to new products and markets**, enable **off-balance sheet mortgage origination and sales**, and create **cross-selling opportunities**[4](index=4&type=chunk) - In June, the Bank launched a **new credit card program** as a strategic initiative to offer **new products and services**, positioning itself as a community bank with high service culture and large bank capabilities[4](index=4&type=chunk) Six-Month Performance Overview | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net (Loss) Income | $(59,000) | $(201,000) | | Diluted (Loss) Per Share | $(0.02) | $(0.07) | [Management Commentary & Strategic Outlook](index=2&type=section&id=Management%20Commentary%20%26%20Strategic%20Outlook) CEO Mark C. Hanna emphasized strategic initiatives for revenue growth and operational efficiency, noting **$280,000 in non-recurring expenses** for headcount reduction from 89 to 73, alongside stable deposits, loan growth, and strong capital - Strategic priorities include **increasing new revenue sources** by **growing client relationships** and becoming **more operationally efficient** to **expand return on assets and capital**[6](index=6&type=chunk) - Non-recurring expenses of **over $280,000** were incurred in Q2 2025 due to **early retirement and employee severance** as part of **cost control initiatives**[6](index=6&type=chunk) Headcount Reduction | Metric | Beginning of Year | June 30, 2025 | | :--------- | :---------------- | :------------ | | Headcount | 89 | 73 | - The Bank's deposit base and cost of funding remain **competitive and stable**, with **good growth in loan revenues**, **strong liquidity**, and **ample capital**[6](index=6&type=chunk) Financial Review [Asset Quality](index=2&type=section&id=Asset%20Quality) The Bank maintained strong asset quality with disciplined lending, seeing non-performing loans decrease and total loans grow by **$6.0 million**, despite an increase in net charge-offs, while maintaining a robust allowance for loan losses Asset Quality Metrics | Metric | June 30, 2025 | March 31, 2025 | Q2 2024 | | :-------------------------------- | :------------ | :------------- | :------ | | Non-performing loans ratio (%) | 0.51% | 0.55% | - | | Net Charge-offs | $45,000 | $4,000 | - | | Net Charge-offs to Average Loans (%) | 0.09% | 0.01% | - | | Provision Expense | $79,000 | $(620,000) (release) | $600,000 | | Allowance for Loan Losses to Loans (%) | 1.21% | 1.30% | 1.30% | - Total loans **increased by $6.0 million** during Q2 2025, representing an **annualized growth rate of 11.5%**[8](index=8&type=chunk) Loan Growth Breakdown - Commercial real estate loans: +$3.4 million - C&I portfolio: +$0.9 million - Consumer loans (automobile): +$1.9 million - Construction and land loans: -$0.3 million [Funding & Liquidity](index=2&type=section&id=Funding%20%26%20Liquidity) Total deposits remained stable at **$317.3 million**, with non-interest bearing deposits increasing by **$2.5 million**, while the cost of deposits and total cost of funds rose, as the Bank prioritizes loan growth over securities Deposit Composition and Growth | Metric | June 30, 2025 | March 31, 2025 | | :-------------------------- | :------------ | :------------- | | Total Deposits | $317.3 million | $317.257 million | | Non-interest Bearing Deposits | $107.027 million | $104.487 million | | Non-interest Bearing Deposits % of Total | 34% | - | | Non-interest Bearing Deposits Growth (QoQ) | +$2.5 million | - | | Annualized Non-interest Bearing Deposits Growth (%) | 9.7% | - | Cost of Funds and Borrowings | Metric | Q2 2025 | Q1 2025 | | :-------------------- | :------ | :------ | | Cost of Deposits (%) | 1.78% | 1.63% | | Total Cost of Funds (%) | 1.36% | 1.30% | | Borrowed Funds (FHLB) | $13.0 million | $20.0 million | Liquidity Sources - FHLB borrowing capacity: $31.4 million - Open pledging capacity of securities portfolio: $57.5 million - FRB borrowing capacity: $33.9 million - Additional access to other wholesale funding: $17.0 million Investment Securities Portfolio | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------- | :------------ | | Investment Securities Available for Sale | $104.6 million | $106.6 million | $117.2 million | | Yield on Securities (%) | 2.25% | - | - | | Effective Duration of Securities Portfolio (years) | 7.3 years | - | - | | Accumulated Other Comprehensive Loss (AOCL) | $(17.8) million | $(17.792) million | $(19.518) million | - The Bank's strategic direction is to **grow its balance sheet through new loans** rather than **increasing reliance on the securities portfolio**[11](index=11&type=chunk) [Capital Adequacy](index=3&type=section&id=Capital%20Adequacy) The Bank's regulatory capital ratios, including a **Leverage Ratio of 9.59%** and **Total Risk Based Ratio of 16.06%**, continue to exceed well-capitalized minimums, demonstrating a strong capital position Regulatory Capital Ratios | Capital Ratio | June 30, 2025 (%) | March 31, 2025 (%) | June 30, 2024 (%) | | :---------------------- | :------------ | :------------- | :------------ | | Leverage Ratio | 9.59% | 9.71% | 10.10% | | Tier I Risk Based Ratio | 14.91% | 15.42% | 15.59% | | Total Risk Based Ratio | 16.06% | 16.60% | 16.84% | [Income Statement Analysis](index=3&type=section&id=Income%20Statement%20Analysis) [Net Interest Income & Margin](index=3&type=section&id=Net%20Interest%20Income%20%26%20Margin) Net interest income increased slightly quarter-over-quarter, driven by a **13 basis point expansion in net interest margin to 3.13%**, as the Bank strategically shifts earning assets from cash and securities towards loans Net Interest Income and Margin Trends | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :-------------------------------- | :------ | :------ | :------ | | Net Interest Income | $2.7 million | $2.6 million | $2.8 million | | Net Interest Margin (tax equivalent) (%) | 3.13% | 3.00% | 3.10% | | Yield on Earning Assets (QoQ change) | +20 bps | - | - | | Yields on Total Loans (QoQ change) | +24 bps (to 5.58%) | - | - | | Total Cost of Funds (QoQ change) | +6 bps (to 1.36%) | - | - | | Total Earning Assets | $359.3 million | $356.2 million | $371.0 million | - Loans now represent **58% of total earning assets** at the end of Q2 2025, **up from 50% in Q2 2024**, indicating an **intentional shift in the balance sheet mix from cash and securities to loans**[13](index=13&type=chunk) [Non-Interest Income](index=4&type=section&id=Non-Interest%20Income) Non-interest income increased modestly quarter-over-quarter to **$220,000**, with future growth anticipated from the expected acquisition of VAWM Non-Interest Income Performance | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :----------------- | :------ | :------ | :------ | | Non-interest Income | $220,000 | $205,000 | $241,000 | - The Bank anticipates **increases in non-interest income** due to the **expected acquisition of VAWM**[14](index=14&type=chunk) [Non-Interest Expense](index=4&type=section&id=Non-Interest%20Expense) Total non-interest expense remained flat quarter-over-quarter at **$3.3 million**, but increased year-over-year due to **$287,000 in non-recurring costs** for early retirement and headcount reductions, offset by decreases in other expenses Non-Interest Expense Breakdown | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--------------------- | :------ | :------ | :------ | | Total Noninterest Expense | $3.3 million | $3.3 million | $2.8 million | | Non-recurring costs | $287,000 | - | - | | Salary and employee benefits | +$199,000 (due to non-recurring costs) | - | - | | Occupancy and equipment expenses | Down | - | - | | Legal, accounting and professional fees | Down | - | - | | Data process services | Down | - | - | Corporate Information [Company Profile](index=4&type=section&id=Company%20Profile) Glen Burnie Bancorp, established in 1949, is a Maryland-based bank holding company with its subsidiary, The Bank of Glen Burnie, operating six branches offering commercial and retail banking services - Glen Burnie Bancorp is a **bank holding company founded in 1949**, with The Bank of Glen Burnie operating **six branch offices** in Anne Arundel County, Maryland[16](index=16&type=chunk) - The Bank offers **commercial and retail banking services**, including **demand and time deposits**, and a **range of loans** such as residential first and second mortgages, home equity lines of credit, commercial mortgage loans, and automobile loans[16](index=16&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This disclaimer notes that statements not based on historical data are forward-looking and subject to risks and uncertainties, advising investors to consult SEC filings for detailed risk factors - Statements in the release that are not historical financial information are **forward-looking** and subject to **risks and uncertainties** that could cause **actual results to differ materially** from anticipated projections[17](index=17&type=chunk) - Investors should refer to the **Company's reports filed with the SEC** for a **more complete discussion of risk factors**[17](index=17&type=chunk) [Contact Information](index=5&type=section&id=Contact%20Information) Contact details for inquiries regarding Glen Burnie Bancorp's financial results are provided, including the President and CEO's name, title, phone, and email - For further information, contact **Mark C. Hanna, President and Chief Executive Officer**, at **410-768-8877** or **mchanna@bogb.net**[18](index=18&type=chunk) Consolidated Financial Statements [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheets present the Bancorp's financial position, with **total assets of $350.7 million**, **total deposits of $317.3 million**, and **total stockholders' equity of $18.9 million** as of June 30, 2025 Consolidated Balance Sheet Highlights | Metric | June 30, 2025 (in thousands) | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | June 30, 2024 (in thousands) | | :--------------------------------- | :------------ | :------------- | :---------------- | :------------ | | **ASSETS** | | | | | | Total Cash and Cash Equivalents | $12,668 | $23,676 | $24,464 | $16,786 | | Investment securities available for sale | $104,566 | $106,623 | $107,949 | $117,180 | | Loans, net | $210,775 | $204,704 | $202,380 | $198,875 | | Total Assets | $350,721 | $357,973 | $358,956 | $355,716 | | **LIABILITIES** | | | | | | Total Deposits | $317,316 | $317,257 | $309,189 | $305,866 | | Short-term borrowings | $13,000 | $20,000 | $30,000 | $30,000 | | Total Liabilities | $331,788 | $338,792 | $341,139 | $338,245 | | **STOCKHOLDERS' EQUITY** | | | | | | Total Stockholders' Equity | $18,933 | $19,181 | $17,817 | $17,471 | [Consolidated Statements of (Loss) Income](index=7&type=section&id=Consolidated%20Statements%20of%20%28Loss%29%20Income) The consolidated statements of (loss) income detail financial performance, reporting a Q2 2025 **net loss of $212,000**, with **net interest income of $2.736 million** Consolidated Statements of (Loss) Income Highlights | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :--------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total Interest Income | $3,877 | $3,893 | $7,506 | $7,298 | | Total Interest Expense | $1,141 | $1,107 | $2,207 | $1,941 | | Net Interest Income | $2,736 | $2,786 | $5,299 | $5,357 | | (Release) provision of credit loss allowance | $79 | $600 | $(541) | $792 | | Total Noninterest Income | $220 | $241 | $425 | $471 | | Total Noninterest Expenses | $3,252 | $2,820 | $6,516 | $5,658 | | Net (loss) income | $(212) | $(204) | $(59) | $(201) | | Basic and diluted net (loss) income per common share | $(0.07) | $(0.07) | $(0.02) | $(0.07) | [Consolidated Statement of Changes in Stockholders' Equity](index=8&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Stockholders%27%20Equity) This statement outlines changes in stockholders' equity, showing **total stockholders' equity of $18.933 million** as of June 30, 2025, reflecting a **net loss of $59,000** and **other comprehensive income of $1.175 million** Consolidated Statement of Changes in Stockholders' Equity Highlights | Metric | Common Stock (in thousands) | Additional Paid-in Capital (in thousands) | Retained Earnings (in thousands) | Accumulated Other Comprehensive (Loss) Income (in thousands) | Total Stockholders' Equity (in thousands) | | :--------------------------------- | :----------- | :------------------------- | :---------------- | :-------------------------------------------- | :------------------------- | | Balance, December 31, 2024 | $2,901 | $11,037 | $22,882 | $(19,003) | $17,817 | | Net income (loss) | - | - | $(59) | - | $(59) | | Other comprehensive income | - | - | - | $1,175 | $1,175 | | Balance, June 30, 2025 | $2,901 | $11,037 | $22,823 | $(17,828) | $18,933 | Selected Financial Data [Key Financial and Performance Metrics](index=9&type=section&id=Key%20Financial%20and%20Performance%20Metrics) This section summarizes key financial data, performance, asset quality, and capital ratios, highlighting the **net loss for Q2 2025**, net interest margin expansion, and the Bank's strong capital and asset quality metrics Selected Financial and Performance Metrics | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | December 31, 2024 | | :--------------------------------------- | :------------ | :------------- | :------------ | :---------------- | | **Financial Data** | | | | | | Assets (in thousands) | $350,721 | $357,973 | $355,716 | $358,956 | | Loans (in thousands) | $213,362 | $207,393 | $201,500 | $205,219 | | Deposits (in thousands) | $317,316 | $317,257 | $305,866 | $309,189 | | Net income (loss) (in thousands) | $(212) | $153 | $(204) | $(112) | | **Performance Ratios** | | | | | | Annualized return on average assets (%) | -0.24% | 0.18% | -0.22% | -0.03% | | Annualized return on average equity (%) | -4.30% | 3.22% | -4.72% | -0.58% | | Net interest margin - FTE (%) | 3.13% | 3.00% | 3.10% | 3.06% | | Basic and diluted net income (loss) per share | $(0.07) | $0.05 | $(0.07) | $(0.04) | | **Asset Quality Ratios** | | | | | | Allowance for loan losses to loans (%) | 1.21% | 1.30% | 1.30% | 1.38% | | Nonperforming loans to avg. loans (%) | 0.51% | 0.55% | 0.17% | 0.19% | | Net charge-offs (recoveries) annualize to avg. loans (%) | 0.09% | 0.01% | -0.14% | 0.08% | | **Capital Ratios** | | | | | | Common Equity Tier 1 Capital (%) | 14.91% | 15.42% | 15.59% | 15.15% | | Leverage Ratio (%) | 9.59% | 9.71% | 10.10% | 9.97% |

Mark C. Hanna, President and Chief Executive Officer noted, "We continue to see and experience very good credit results and indicators in our markets, while our non-performing assets remain at minimum levels. Our allowance for credit losses remained higher than our peers at 1.21% of loans, illustrating our emphasis on disciplined lending practices and fortifying our balance sheet for any economic cycle." Highlights for the Second Quarter of 2025: GLEN BURNIE, Md., July 29, 2025 (GLOBE NEWSWIRE) -- Glen Burn ...

Financial Performance - The Company reported net income of $153,000 for the three-month period ended March 31, 2025, compared to $3,000 for the same period in 2024, primarily due to a $315,000 decrease in the provision for credit loss allowance [104]. - Comprehensive income for the first quarter of 2025 totaled $1.4 million, compared to a comprehensive loss of $0.9 million for the same period in 2024, reflecting a $2.3 million increase [124]. - The income tax benefit for the three-month period ended March 31, 2025, was $29,000, a decrease of $203,000 or 87.5% compared to $232,000 in 2024, primarily due to a $353,000 increase in pre-tax income [123]. Assets and Liabilities - Total assets decreased to $358.0 million on March 31, 2025, a decrease of $1.0 million from December 31, 2024, while total deposits increased by $8.1 million, or 2.6% [105]. - Total assets decreased to $358.0 million at March 31, 2025, from $359.0 million at December 31, 2024, a decrease of $1.0 million or 0.3% [125]. - Loans, net increased to $204.7 million at March 31, 2025, an increase of $2.3 million or 1.1% from $202.4 million at December 31, 2024 [125]. - Total deposits increased to $317.3 million as of March 31, 2025, an increase of $8.1 million or 2.6% from $309.2 million at December 31, 2024 [130]. - As of March 31, 2025, the Bank's cash and cash equivalents totaled $23.7 million, an increase of $0.8 million, or 3.2% from $24.5 million at December 31, 2024 [154]. Credit Losses and Allowance - The Company's allowance for credit losses was $2.69 million as of March 31, 2025, compared to $2.84 million at December 31, 2024, a decrease of $150,000 or 5.3% [105]. - The provision for credit loss allowance on loans decreased to $146,000 for the three-month period ended March 31, 2025, from $169,000 for the same period in 2024, reflecting a decrease of 13.6% [120]. - The Bank's allowance for credit losses is based on estimates and assumptions about future events, which may differ from actual results [165]. - The adoption of ASC 326 has significantly changed the methodology for estimating the Allowance for Credit Losses (ACL) from an "incurred loss" approach to an "expected loss" approach known as current expected credit loss (CECL) [166]. - The CECL methodology requires an estimate of credit losses expected over the life of an exposure, which is influenced by historical loss experience, current conditions, and reasonable forecasts [167]. - Management's determination of the ACL is a critical accounting estimate that relies on credit risk assessments, historical loss rates, and forecasts affecting collectability [169]. - The impact of CECL on the ACL will be influenced by the loan portfolio's composition and prevailing economic conditions, potentially leading to greater volatility in reported earnings [170]. Interest Income and Expenses - Net interest income for the three-month period ended March 31, 2025, was $2.56 million, a decrease of $8,000 or 0.3% from the same period in 2024 [112]. - Total interest income for the first quarter of 2025 increased by $224,000, or 6.6%, compared to the same period in 2024, driven by a $494,000 increase in interest and fees on loans [113]. - Interest expense for the first quarter of 2025 increased by $233,000, or 28.0%, from $833,000 for the same period in 2024 to $1.1 million [114]. - Net interest margin for the three-month period ended March 31, 2025, was 2.92%, an increase of 0.06% from 2.86% for the same period in 2024 [115]. - Average total loan balances increased by $30.0 million to $205.9 million for the three-month period ended March 31, 2025, compared to $175.9 million for the same period in 2024 [117]. Noninterest Income and Expenses - Noninterest income decreased to $205,000 for the three-month period ended March 31, 2025, down $24,000 or 10.5% from $229,000 in 2024, primarily due to decreases in other fees and commissions [121]. - Noninterest expenses decreased to $2.79 million for the three-month period ended March 31, 2025, a decrease of $71,000 or 2.5% from $2.86 million in 2024, mainly due to a $498,000 decrease in the provision for losses on unfunded commitments [122]. Capital and Ratios - The Company's stockholders' equity increased by $1.4 million, or 7.7% during the three-month period ended March 31, 2025 [156]. - The Bank's Tier 1 leverage ratio was 9.71%, and the total risk-based capital ratio was 16.60% as of March 31, 2025, indicating full compliance with capital adequacy guidelines [162]. Internal Controls and Compliance - The Company identified material weaknesses in internal controls over financial reporting, particularly regarding the validation of CECL model inputs and reliance on third-party data [175]. - Despite the identified weaknesses, the Company's consolidated financial statements are fairly stated in accordance with generally accepted accounting principles [176]. - Management has initiated a remediation plan to enhance internal controls and validate third-party data [177]. - The Company has implemented system-based controls requiring secondary review and approval of journal entries to address previously reported material weaknesses [180]. - There have been no changes to the Company's internal control over financial reporting that materially affect its effectiveness since the beginning of the first quarter of 2025 [182]. Litigation and Risk - Management does not anticipate that ongoing litigation will have a material effect on the Company's financial condition or operating results [183].

[Press Release Overview](index=1&type=section&id=Press%20Release%20Overview) Glen Burnie Bancorp reported significantly increased Q1 2025 net income and total assets, with the CEO emphasizing disciplined lending and strong asset quality [Announcement and Key Figures](index=1&type=section&id=1.1%20Announcement%20and%20Key%20Figures) Glen Burnie Bancorp reported a significant increase in net income for Q1 2025, reaching $153,000 or $0.05 per share, compared to $3,000 or $0 per share in Q1 2024. Total assets stood at $358.0 million as of March 31, 2025 | Metric | Q1 2025 | Q1 2024 | | :-------------------------------- | :------ | :------ | | Net Income | $153,000 | $3,000 | | Basic and Diluted Common Share EPS | $0.05 | $0 | | Total Assets (as of March 31, 2025) | $358.0 million | - | [CEO's Strategic Commentary](index=1&type=section&id=1.2%20CEO's%20Strategic%20Commentary) CEO Mark C. Hanna emphasized the company's focus on growing loans and deposits to improve revenues, margins, and profitability, while maintaining disciplined lending practices. He highlighted strong asset quality with minimal non-performing assets and a robust allowance for credit losses - The Company continues to pursue **growing loans and deposits** to improve **revenues, margins and, ultimately, profitability**, while emphasizing **disciplined lending practices** and focusing on **new client relationships**, **safety, and margin**[3](index=3&type=chunk) | Metric | March 31, 2025 | | :-------------------------- | :------------- | | Allowance for Credit Losses | $2.7 million | | % of Total Loans | 1.30% | | Non-performing Assets | Minimal levels | | Financial Strength | **Strong, sound, and secure** (**capital levels**, **asset quality**, **diversified deposit base**, **liquidity sources**) | [Highlights for the First Three Months of 2025](index=1&type=section&id=Highlights%20for%20the%20First%20Three%20Months%20of%202025) The company experienced a slight decrease in net interest income but improved returns on assets and equity, maintaining strong liquidity and capital for future growth [Financial Performance Highlights](index=1&type=section&id=2.1%20Financial%20Performance%20Highlights) Net interest income slightly decreased by $8,000 (0.31%) to $2.56 million, driven by increased interest expense on deposits offset by higher interest income from loans. Return on average assets and equity significantly improved, primarily due to a release of provision for credit allowance | Metric | Q1 2025 | Q1 2024 | Change (YoY) | | :-------------------------------- | :-------- | :-------- | :----------- | | Net Interest Income | $2.56 million | $2.57 million | -$8,000 (-0.31%) | | Interest Expense | Increased $233,000 | - | +$233,000 | | Interest Income | Increased $224,000 | - | +$224,000 | | Return on Average Assets | 0.17% | 0% | +0.17 pp | | Return on Average Equity | 3.22% | 0.06% | +3.16 pp | - The increase in interest on deposits was driven by **increased deposit balances** in **money market products**. The increase in interest and fees on loans was driven by a **$30.0 million** **higher average balance** and **0.27%** **higher yield on loan balances**[4](index=4&type=chunk) - Higher **return on average assets** and **average equity** was primarily driven by the **release of provision for credit allowance** on loans and **unfunded commitments**[6](index=6&type=chunk) [Liquidity and Capital Outlook](index=1&type=section&id=2.2%20Liquidity%20and%20Capital%20Outlook) The Company maintains strong liquidity through managed cash, borrowing lines with FHLB of Atlanta, the Federal Reserve, correspondent banks, and a diversified bond portfolio. This robust liquidity and capital position is expected to support future growth - The Company expects its **strong liquidity** and **capital positions** to provide **ample capacity for future growth**[5](index=5&type=chunk) - **Liquidity** remained **strong** due to **managed cash and cash equivalents**, **borrowing lines** with the **FHLB of Atlanta**, the **Federal Reserve** and **correspondent banks**, and the size and composition of the **bond portfolio**[7](index=7&type=chunk) [Balance Sheet Review](index=2&type=section&id=Balance%20Sheet%20Review) Total assets slightly decreased while loans and deposits grew, stockholders' equity increased due to reduced unrealized losses, and asset quality remained sound despite a rise in nonperforming assets [Assets](index=2&type=section&id=3.1%20Assets) Total assets slightly decreased to $358.0 million from $359.0 million QoQ. Loans, net of deferred fees and costs, increased by $2.2 million (1.06%) QoQ and 16.52% YoY, reaching $207.4 million. Investment securities saw a minor decrease | Metric | March 31, 2025 | December 31, 2024 | Change (QoQ) | | :-------------------------------- | :------------- | :---------------- | :----------- | | Total Assets | $358.0 million | $359.0 million | -$1.0 million (-0.27%) | | Cash and Cash Equivalents | Decreased $788,000 | - | -3.22% | | Investment Securities | $106.6 million | $107.9 million | -$1.3 million (-1.23%) | | Loans, Net of Deferred Fees & Costs | $207.4 million | $205.2 million | +$2.2 million (+1.06%) | | Loans (YoY) | $207.4 million | $178.0 million (March 31, 2024) | +16.52% | | Average Earning-Asset Balances | $356.2 million | $362.0 million (prior-year Q1) | Slightly declined | [Liabilities and Deposits](index=2&type=section&id=3.2%20Liabilities%20and%20Deposits) Total deposits increased by $8.1 million (2.61%) QoQ to $317.3 million, with both noninterest-bearing and interest-bearing deposits contributing to the growth. Total borrowings decreased significantly by $10.0 million (33.33%) QoQ to $20.0 million | Metric | March 31, 2025 | December 31, 2024 | Change (QoQ) | | :-------------------------- | :------------- | :---------------- | :----------- | | Total Deposits | $317.3 million | $309.2 million | +$8.1 million (+2.61%) | | Noninterest-Bearing Deposits | $104.5 million | $100.7 million | +$3.7 million (+3.71%) | | Interest-Bearing Deposits | $212.8 million | $208.4 million | +$4.4 million (+2.08%) | | Total Borrowings | $20.0 million | $30.0 million | -$10.0 million (-33.33%) | [Stockholders' Equity](index=2&type=section&id=3.3%20Stockholders'%20Equity) Total stockholders' equity increased to $19.2 million (5.36% of total assets) from $17.8 million (4.96%) QoQ, resulting in a book value of $6.61 per common share. This increase was primarily driven by a decline in unrealized losses on available-for-sale securities due to decreasing market interest rates | Metric | March 31, 2025 | December 31, 2024 | Change (QoQ) | | :-------------------------------- | :------------- | :---------------- | :----------- | | Total Stockholders' Equity | $19.2 million | $17.8 million | +$1.4 million | | % of Total Assets | 5.36% | 4.96% | +0.40 pp | | Book Value Per Common Share | $6.61 | $6.14 | +$0.47 | | Unrealized Losses (net of taxes) on AFS Securities | $17.8 million | $19.0 million | -$1.2 million | - The decrease in **unrealized losses** on **available-for-sale investment securities** primarily resulted from **decreasing market interest rates** during Q1 2025, which increased the fair value of these securities[10](index=10&type=chunk) [Asset Quality](index=2&type=section&id=3.4%20Asset%20Quality) Asset quality remained sound, with nonperforming assets representing 0.32% of total assets, an increase from 0.10% QoQ. The allowance for credit losses on loans decreased to $2.7 million (1.30% of total loans), while the allowance for unfunded commitments significantly decreased due to lower loss rates | Metric | March 31, 2025 | December 31, 2024 | Change (QoQ) | | :-------------------------------- | :------------- | :---------------- | :----------- | | Nonperforming Assets (% of Total Assets) | 0.32% | 0.10% | +0.22 pp | | Allowance for Credit Losses on Loans | $2.7 million | $2.8 million | -$0.1 million | | % of Total Loans | 1.30% | 1.38% | -0.08 pp | | Allowance for Credit Losses for Unfunded Commitments | $110,000 | $584,000 | -$474,000 | - The **$474,000** decrease in **allowance for credit losses for unfunded commitments** was primarily driven by the utilization of **1.33%** **lower loss rates** during Q1 2025 compared to Q4 2024[11](index=11&type=chunk) [Review of Financial Results](index=3&type=section&id=Review%20of%20Financial%20Results) Net income significantly improved due to credit loss allowance decreases, despite a slight dip in net interest income, with ongoing efforts to reduce noninterest expenses [Net Income Drivers](index=3&type=section&id=4.1%20Net%20Income%20Drivers) Net income for Q1 2025 increased to $153,000 from $3,000 in Q1 2024. This improvement was primarily due to a $315,000 decrease in the allowance for credit loss and a $474,000 decrease in the allowance for unfunded commitments, partially offset by increased salary and employee benefits, legal fees, and a decreased income tax benefit | Metric | Q1 2025 | Q1 2024 | Change (YoY) | | :-------------------------------- | :------ | :------ | :----------- | | Net Income | $153,000 | $3,000 | +$150,000 | | Decrease in Allowance for Credit Loss | $315,000 | - | +$315,000 | | Decrease in Allowance for Unfunded Commitments | $474,000 | - | +$474,000 | | Increase in Salary and Employee Benefits | $209,000 | - | -$209,000 | | Increase in Legal, Accounting, and Other Professional Fees | $129,000 | - | -$129,000 | | Decrease in Income Tax Benefit | $203,000 | - | -$203,000 | [Net Interest Income and Margin](index=3&type=section&id=4.2%20Net%20Interest%20Income%20and%20Margin) Net interest income slightly decreased by $8,000 to $2.56 million. However, net interest margin increased by 0.06% to 2.92%, driven by higher loan yields (up 0.28% to 5.34%) despite an increase in the cost of interest-bearing liabilities (up 0.38% to 1.89%) | Metric | Q1 2025 | Q1 2024 | Change (YoY) | | :-------------------------------- | :-------- | :-------- | :----------- | | Net Interest Income | $2.56 million | $2.57 million | -$8,000 | | Net Interest Margin | 2.92% | 2.86% | +0.06 pp | | Loan Yields | 5.34% | 5.06% | +0.28 pp | | Cost of Interest-Bearing Liabilities | 1.89% | 1.51% | +0.38 pp | | Average Balance of Interest-Earning Assets | Decreased $5.8 million | - | - | | Yield on Interest-Earning Assets | 4.13% | 3.78% | +0.35 pp | | Average Balance of Interest-Bearing Funds | Increased $7.6 million | - | - | | Average Balance of Noninterest-Bearing Funds | Decreased $12.9 million | - | - | | Cost of Funds | Increased 0.31% | - | - | [Noninterest Income and Expenses](index=3&type=section&id=4.3%20Noninterest%20Income%20and%20Expenses) Noninterest income decreased to $205,000 from $229,000 YoY. Total noninterest expenses decreased by $69,000 to $2.8 million, primarily due to a significant decrease in the credit allowance for unfunded commitments, partially offset by higher salary and employee benefits and legal fees. The company is implementing measures like branch closures and an early retirement program to reduce future non-interest expenses | Metric | Q1 2025 | Q1 2024 | Change (YoY) | | :-------------------------------- | :-------- | :-------- | :----------- | | Noninterest Income | $205,000 | $229,000 | -$24,000 | | Total Noninterest Expenses | $2.8 million | $2.9 million | -$69,000 | | Decrease in Credit Allowance for Unfunded Commitments | $474,000 | - | +$474,000 | | Increase in Salary and Employee Benefits | $209,000 | - | -$209,000 | | Increase in Legal, Accounting, and Other Professional Fees | $129,000 | - | -$129,000 | - The Company is taking steps to reduce **non-interest expenses** in future periods, including the January 2025 closure of its Linthicum **branch office**, the planned closing of its Severna Park **branch office** in May 2025, and the recent announcement of an **early retirement program**[13](index=13&type=chunk) [Income Tax Benefit](index=3&type=section&id=4.4%20Income%20Tax%20Benefit) The income tax benefit for Q1 2025 was $29,000, a decrease from $232,000 in the prior-year period. The prior year's benefit included $87,000 associated with amended Maryland tax returns | Metric | Q1 2025 | Q1 2024 | Change (YoY) | | :---------------- | :------ | :------ | :----------- | | Income Tax Benefit | $29,000 | $232,000 | -$203,000 | | Q1 2024 Benefit included | - | $87,000 (amended MD tax returns) | - | [Company Information](index=4&type=section&id=Company%20Information) Glen Burnie Bancorp is a Maryland-based community bank offering commercial and retail services, with the report containing forward-looking statements and contact information [About Glen Burnie Bancorp](index=4&type=section&id=5.1%20About%20Glen%20Burnie%20Bancorp) Glen Burnie Bancorp is a bank holding company headquartered in Glen Burnie, Maryland, established in 1949. Its subsidiary, The Bank of Glen Burnie, operates seven branch offices in Anne Arundel County, providing commercial and retail banking services, including demand and time deposits, and various loan types - **Glen Burnie Bancorp** is a **bank holding company** headquartered in Glen Burnie, Maryland, founded in 1949. The Bank of Glen Burnie is a **locally owned community bank** with seven **branch offices** serving Anne Arundel County[21](index=21&type=chunk) - The Bank is engaged in **commercial and retail banking**, including **acceptance of demand and time deposits**, and **origination of loans** to individuals, associations, partnerships, and corporations. **Real estate financing** includes **residential first and second mortgage loans**, **home equity lines of credit**, and **commercial mortgage loans**. The Bank also originates **automobile loans**[21](index=21&type=chunk) [Forward-Looking Statements](index=4&type=section&id=5.2%20Forward-Looking%20Statements) The report contains forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially from projections. These statements are not guarantees of future performance, and readers are advised to consult SEC filings for a complete discussion of risk factors - Statements not historical financial information may be **forward-looking statements**, subject to **risks and uncertainties** that could cause **actual results to differ materially** from anticipated or projected results[22](index=22&type=chunk) - These statements are **not guarantees of future performance** and may not prove true. For a more complete discussion of **risk factors**, refer to the Company's **reports filed with the Securities and Exchange Commission**[22](index=22&type=chunk) [Contact Information](index=4&type=section&id=5.3%20Contact%20Information) For further information, inquiries can be directed to Jeffrey D. Harris, Chief Financial Officer, via phone or email - Contact: Jeffrey D. Harris, **Chief Financial Officer**, 410-768-8883, jdharris@bogb.net, 106 Padfield Blvd, Glen Burnie, MD 21061[23](index=23&type=chunk) [Consolidated Financial Statements](index=5&type=section&id=Consolidated%20Financial%20Statements) This section presents the consolidated balance sheets, statements of income, changes in stockholders' equity, and selected financial data for various periods [Consolidated Balance Sheets](index=5&type=section&id=6.1%20Consolidated%20Balance%20Sheets) This section presents the consolidated balance sheets for Glen Burnie Bancorp and its subsidiary as of March 31, 2025, March 31, 2024, and December 31, 2024, detailing assets, liabilities, and stockholders' equity | | March 31, 2025 | March 31, 2024 | December 31, 2024 | | :------------------------------------------ | :------------- | :------------- | :---------------- | | **ASSETS** | | | | | Cash and due from banks | $1,792 | $9,091 | $2,012 | | Interest-bearing deposits in other financial institutions | 21,884 | 33,537 | 22,452 | | Total Cash and Cash Equivalents | 23,676 | 42,628 | 24,464 | | Investment securities available for sale, at fair value | 106,623 | 128,727 | 107,949 | | Restricted equity securities, at cost | 1,201 | 246 | 1,671 | | Loans, net of deferred fees and costs | 207,393 | 177,950 | 205,219 | | Less:Allowance for credit losses(1) | (2,689) | (2,035) | (2,839) | | Loans, net | 204,704 | 175,915 | 202,380 | | Premises and equipment, net | 2,609 | 2,928 | 2,678 | | Bank owned life insurance | 8,877 | 8,700 | 8,834 | | Deferred tax assets, net | 8,088 | 8,255 | 8,548 | | Accrued interest receivable | 1,243 | 1,281 | 1,345 | | Accrued taxes receivable | 159 | 363 | 148 | | Prepaid expenses | 474 | 460 | 471 | | Other assets | 319 | 367 | 468 | | **Total Assets** | **$357,973** | **$369,870** | **$358,956** | | **LIABILITIES** | | | | | Noninterest-bearing deposits | $104,487 | $115,167 | $100,747 | | Interest-bearing deposits | 212,770 | 194,064 | 208,442 | | Total Deposits | 317,257 | 309,231 | 309,189 | | Short-term borrowings | 20,000 | 40,000 | 30,000 | | Defined pension liability | 338 | 327 | 330 | | Accrued expenses and other liabilities | 1,197 | 2,183 | 1,620 | | **Total Liabilities** | **338,792** | **351,741** | **341,139** | | **STOCKHOLDERS' EQUITY** | | | | | Common stock | 2,901 | 2,887 | 2,901 | | Additional paid-in capital | 11,037 | 10,989 | 11,037 | | Retained earnings | 23,035 | 23,575 | 22,882 | | Accumulated other comprehensive loss | (17,792) | (19,322) | (19,003) | | **Total Stockholders' Equity** | **19,181** | **18,129** | **17,817** | | **Total Liabilities and Stockholders' Equity** | **$357,973** | **$369,870** | **$358,956** | [Consolidated Statements of (Loss) Income](index=6&type=section&id=6.2%20Consolidated%20Statements%20of%20(Loss)%20Income) This section provides the consolidated statements of (loss) income for the three-month periods ended March 31, 2025, and 2024, detailing interest income, interest expense, net interest income, credit loss allowance, noninterest income, noninterest expenses, and net income | | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :------------------------------------------ | :-------------------------------- | :-------------------------------- | | **Interest income** | | | | Interest and fees on loans | $2,709 | $2,215 | | Interest and dividends on securities | 745 | 938 | | Interest on deposits with banks and federal funds sold | 175 | 252 | | **Total Interest Income** | **3,629** | **3,405** | | **Interest expense** | | | | Interest on deposits | 841 | 402 | | Interest on short-term borrowings | 225 | 431 | | **Total Interest Expense** | **1,066** | **833** | | **Net Interest Income** | **2,563** | **2,572** | | (Release) provision of credit loss allowance | (146) | 169 | | **Net interest income after credit loss provision** | **2,709** | **2,403** | | **Noninterest income** | | | | Service charges on deposit accounts | 31 | 38 | | Other fees and commissions | 131 | 148 | | Income on life insurance | 43 | 43 | | **Total Noninterest Income** | **205** | **229** | | **Noninterest expenses** | | | | Salary and employee benefits | 1,827 | 1,618 | | Occupancy and equipment expenses | 309 | 331 | | Legal, accounting and other professional fees | 383 | 254 | | Data processing and item processing services | 256 | 250 | | FDIC insurance costs | 41 | 38 | | Advertising and marketing related expenses | 37 | 23 | | Loan collection costs | 45 | 5 | | Telephone costs | 38 | 40 | | Other expenses | (146) | 302 | | **Total Noninterest Expenses** | **2,790** | **2,861** | | **Loss before income taxes** | **124** | **(229)** | | **Income tax beneift** | **(29)** | **(232)** | | **Net income** | **$153** | **$3** | | **Basic and diluted net income per common share** | **$0.05** | **$-** | [Consolidated Statement of Changes in Stockholders' Equity](index=7&type=section&id=6.3%20Consolidated%20Statement%20of%20Changes%20in%20Stockholders'%20Equity) This section details the changes in stockholders' equity for Glen Burnie Bancorp and its subsidiary for the three months ended March 31, 2025, and 2024, including common stock, additional paid-in capital, retained earnings, and accumulated other comprehensive loss | (dollars in thousands) | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Total Stockholders' Equity | | :------------------------------------------ | :------------- | :------------------------- | :---------------- | :--------------------------------- | :------------------------- | | **Balance, December 31, 2023** | **$2,883** | **$10,964** | **$23,859** | **$(18,381)** | **$19,325** | | Net income | - | - | 3 | - | 3 | | Cash dividends, $0.10 per share | - | - | (287) | - | (287) | | Dividends reinvested under dividend reinvestment plan | 4 | 25 | - | - | 29 | | Other comprehensive loss | - | - | - | (941) | (941) | | **Balance, March 31, 2024** | **$2,887** | **$10,989** | **$23,575** | **$(19,322)** | **$18,129** | | **Balance, December 31, 2024** | **$2,901** | **$11,037** | **$22,882** | **$(19,003)** | **$17,817** | | Net income | - | - | 153 | - | 153 | | Other comprehensive income | - | - | - | 1,211 | 1,211 | | **Balance, March 31, 2025** | **$2,901** | **$11,037** | **$23,035** | **$(17,792)** | **$19,181** | [Selected Financial Data](index=8&type=section&id=6.4%20Selected%20Financial%20Data) This section provides a comprehensive overview of selected financial data, including key balance sheet items, average balances, performance ratios (ROAA, ROAE, NIM), asset quality ratios, and capital ratios for various periods | | March 31, 2025 | December 31, 2024 | March 31, 2024 | Year Ended December 31, 2024 | | :------------------------------------------ | :------------- | :---------------- | :------------- | :--------------------------- | | **Financial Data** | | | | | | Assets | $357,973 | $358,956 | $369,870 | $358,956 | | Investment securities | 106,623 | 107,949 | 128,727 | 107,949 | | Loans, (net of deferred fees & costs) | 207,393 | 205,219 | 177,950 | 205,219 | | Allowance for loan losses | 2,689 | 2,839 | 2,035 | 2,839 | | Deposits | 317,257 | 309,189 | 309,231 | 309,189 | | Borrowings | 20,000 | 30,000 | 40,000 | 30,000 | | Stockholders' equity | 19,181 | 17,817 | 18,129 | 17,817 | | Net income (loss) | 153 | (39) | 3 | (112) | | **Average Balances** | | | | | | Assets | $353,308 | $366,888 | $358,877 | $363,994 | | Investment securities | 132,805 | 136,868 | 163,618 | 148,037 | | Loans, (net of deferred fees & costs) | 205,868 | 204,703 | 175,914 | 192,646 | | Deposits | 312,030 | 314,046 | 305,858 | 309,838 | | Borrowings | 20,215 | 30,323 | 31,667 | 32,721 | | Stockholders' equity | 19,258 | 20,664 | 19,124 | 19,169 | | **Performance Ratios** | | | | | | Annualized return on average assets | 0.17% | -0.04% | 0.00% | -0.03% | | Annualized return on average equity | 3.22% | -0.75% | 0.06% | -0.58% | | Net interest margin | 2.92% | 2.98% | 2.86% | 2.98% | | Dividend payout ratio | 0% | 0% | 9426% | -773% | | Book value per share | $6.61 | $6.14 | $6.28 | $6.14 | | Basic and diluted net income (loss) per share | 0.05 | (0.01) | - | (0.04) | | Cash dividends declared per share | 0.00 | 0.00 | 0.10 | 0.30 | | Basic and diluted weighted average shares outstanding | 2,900,681 | 2,900,681 | 2,885,552 | 2,893,871 | | **Asset Quality Ratios** | | | | | | Allowance for loan losses to loans | 1.30% | 1.38% | 1.14% | 1.38% | | Nonperforming loans to avg. loans | 0.55% | 0.18% | 0.21% | 0.19% | | Allowance for loan losses to nonaccrual & 90+ past due loans | 236.9% | 789.1% | 549.1% | 789.1% | | Net charge-offs (recoveries) annualize to avg. loans | 0.01% | -0.04% | 0.66% | 0.08% | | **Capital Ratios** | | | | | | Common Equity Tier 1 Capital | N/A | 15.15% | 17.14% | 15.15% | | Tier 1 Risk-based Capital Ratio | N/A | 15.15% | 17.14% | 15.15% | | Leverage Ratio | N/A | 9.97% | 10.43% | 9.97% | | Total Risk-Based Capital Ratio | N/A | 16.40% | 18.30% | 16.40% |

Core Insights - Glen Burnie Bancorp reported a net income of $153,000 for Q1 2025, a significant increase from $3,000 in Q1 2024, indicating improved profitability [1][11] - The bank's total assets as of March 31, 2025, were $358.0 million, reflecting a slight decrease of 0.27% from the previous quarter [7][28] - The company is focused on growing loans and deposits while maintaining disciplined lending practices to enhance revenues and profitability [2][4] Financial Performance - Net interest income for Q1 2025 was $2.56 million, a decrease of $8,000 or 0.31% compared to $2.57 million in Q1 2024, primarily due to increased interest expenses [3][13] - The return on average assets for Q1 2025 was 0.17%, up from 0% in Q1 2024, while the return on average equity increased to 3.22% from 0.06% [5][28] - Noninterest income decreased to $205,000 in Q1 2025 from $229,000 in Q1 2024 [17][25] Balance Sheet Highlights - Total deposits increased to $317.3 million as of March 31, 2025, a rise of 2.61% from $309.2 million at the end of 2024 [8][28] - Loans, net of deferred fees and costs, rose to $207.4 million, an increase of 1.06% from $205.2 million at the end of 2024, and a 16.52% increase year-over-year [7][28] - Total stockholders' equity increased to $19.2 million, representing 5.36% of total assets, up from $17.8 million (4.96% of total assets) at the end of 2024 [9][28] Asset Quality - Nonperforming assets represented 0.32% of total assets as of March 31, 2025, compared to 0.10% at the end of 2024, indicating a slight deterioration in asset quality [10][28] - The allowance for credit losses stood at $2.7 million, or 1.30% of total loans, down from 1.38% at the end of 2024 [10][28] Strategic Initiatives - The company is implementing measures to reduce non-interest expenses, including branch closures and an early retirement program [12][18] - Glen Burnie Bancorp aims to enhance its funding sources and earning assets while building infrastructure to support customer relationships [2][4]

Core Viewpoint - The Bank of Glen Burnie is expanding its lending team to enhance its commercial banking and lending portfolios, with key promotions and new appointments aimed at driving growth and profitability [1][2][5]. Group 1: Leadership Changes - Jonathan Shearin has been promoted to chief lending officer, effective March 13, 2025, after demonstrating significant impact on the loan portfolio since joining the bank in 2024 [1][2]. - Jeff Welch has been appointed as executive vice president and chief credit officer, effective March 31, 2025, bringing over 40 years of experience in risk management and lending [1][3][5]. Group 2: Strategic Focus - Shearin's role will focus on driving sales and revenue, developing the bank's lending strategy, and overseeing loan production and growth objectives [2][5]. - Welch will manage credit risk, evaluate loan applications, and ensure regulatory compliance related to credit risk [2][3]. Group 3: Company Background - Glen Burnie Bancorp is a bank holding company founded in 1949, operating The Bank of Glen Burnie, which has seven branches in Anne Arundel County, Maryland [6][7]. - The bank engages in commercial and retail banking, including various loan origination services and deposit acceptance [6][7].

Financial Performance - Net interest income decreased to $10.9 million in 2024 from $12.1 million in 2023, a decline of 9.9%[132] - The consolidated net loss for 2024 was $0.1 million, compared to a net income of $1.4 million in 2023, marking a decrease of $1.5 million[133] - Annualized return on average assets was (0.03)% in 2024, down from 0.40% in 2023[134] - The equity to asset ratio decreased to 5.0% in 2024 from 5.5% in 2023[134] - Net interest margin fell to 2.98% in 2024 from 3.31% in 2023[138] - The dividend payout ratio was -750% in 2024, a significant change from 80% in 2023[134] Interest Income and Expense - Total interest income increased by 14.1% from $13.3 million in 2023 to $15.2 million in 2024, primarily due to a $1.9 million increase in interest and fees on loans[137] - Interest expense surged by 255.3% from $1.2 million in 2023 to $4.3 million in 2024, driven by a $1.1 million increase in interest on short-term borrowings and a $2.0 million increase in interest on deposits[138] Credit Losses and Allowances - The provision for credit loss allowance increased by $748,000 in 2024 compared to 2023[133] - The allowance for credit losses - loans was $2.8 million, or 1.4% of total loans at December 31, 2024, compared to $2.2 million, or 1.2% of total loans at December 31, 2023[150] - The Company recognized a credit loss provision - loans of $0.8 million for the year ended December 31, 2024, compared to $0.1 million for the year ended December 31, 2023[150] - The allowance for credit losses was $2.8 million at December 31, 2024, compared to $2.2 million in 2023[166] - The allowance for credit losses increased by $682,000 during 2024, reflecting a provision for credit loss of $844,000[182] Loan and Deposit Growth - Total gross loans increased by $1.9 million, with a notable rise in loans secured by real estate contributing to this growth[140] - Total deposits increased by $9.1 million, or 3.0%, to $309.2 million at the end of 2024 compared to $300.1 million at the end of 2023[155] - Loans, net at December 31, 2024, were $202.4 million compared to $174.2 million at December 31, 2023, a decrease of $28.2 million or 16.2%[155] - Nonperforming loans to gross loans ratio improved to 0.2% in 2024 from 0.3% in 2023[174] - Nonperforming assets decreased to $360,000 at December 31, 2024, from $527,000 at December 31, 2023, representing 0.10% of total assets compared to 0.15% in the prior year[174] Asset Management - Total assets increased by $7.1 million, or 2.0%, to $359.0 million at December 31, 2024, compared to $351.8 million at December 31, 2023[154] - Cash and cash equivalents increased by $9.2 million primarily due to a $9.1 million increase in deposit balances[156] - Investment securities decreased by $31.5 million, or 22.6%, to $107.9 million compared to year-end 2023[155] - The Company's investment securities portfolio decreased by $31.5 million, or 22.58%, to $107.9 million at December 31, 2024, from $139.4 million at December 31, 2023[159] Capital and Regulatory Ratios - Stockholders' equity decreased to $17.8 million at December 31, 2024, a decline of $1.5 million or 7.8% compared to $19.3 million in 2023[193] - Common Equity Tier 1 Capital ratio was 15.15% as of December 31, 2024, significantly above the minimum requirement of 4.50%[202] - Total Risk-Based Capital ratio was 16.40% at December 31, 2024, exceeding the required minimum of 8.00%[202] - The Bank's leverage ratio was 9.97% at December 31, 2024, well above the minimum requirement of 4.00%[202] Interest Rate Risk Management - The net interest income simulation analysis indicates that the Bank is in an asset sensitive position in all falling rate scenarios and in a liability sensitive position in all rising rate scenarios[227] - The economic value of equity (EVE) at December 31, 2024 showed a decrease of 11% under +100 bp shock, slightly outside the policy limit of -10%[234] - The Bank's interest rate risk management policy establishes limits on risk, measured as the percentage change in net interest income and the fair value of equity capital due to hypothetical changes in U.S. Treasury interest rates[222] Credit Availability and Commitments - The Bank's total credit availability from the Federal Home Loan Bank was $92.1 million, with $62.1 million available to be drawn as of December 31, 2024[209] - The Bank's total commitments to extend credit and unused lines of credit totaled $31.6 million at December 31, 2024[207] - As of December 31, 2024, the Bank has accrued $584,000 as a reserve for credit losses on unfunded commitments, an increase of $111,000 from $473,000 as of December 31, 2023[218]

Core Insights - Glen Burnie Bancorp reported a net loss of $39,000 for Q4 2024, compared to a net income of $167,000 in Q4 2023, indicating a significant decline in profitability [1][14] - For the full year 2024, the company experienced a net loss of $112,000, a stark contrast to the net income of $1.4 million in 2023, reflecting ongoing challenges in the interest rate environment [1][23] - The bank's total assets increased to $358.9 million as of December 31, 2024, up from $351.8 million a year earlier, showing modest growth despite financial difficulties [1][10] Financial Performance - Net interest income decreased by $1.2 million, or 9.84%, to $10.9 million for the year ended December 31, 2024, primarily due to a $3.1 million rise in interest expenses [3][24] - Total interest income rose by $1.9 million to $15.2 million for the same period, driven by higher interest and fees on loans [4][30] - The net interest margin for the year was 2.98%, down from 3.31% in 2023, reflecting increased costs and competitive pressures [25][42] Asset and Liability Management - Loans increased by $28.9 million, or 16.40%, to $205.2 million as of December 31, 2024, indicating growth in the lending portfolio [10][28] - Total deposits rose by $9.1 million, or 3.04%, to $309.2 million, with interest-bearing deposits increasing significantly [11][42] - The cost of funds increased to 1.38% for Q4 2024, compared to 0.64% in Q4 2023, primarily due to higher costs associated with money market deposits [7][18] Capital and Equity - The book value per share decreased to $6.14 as of December 31, 2024, down from $6.70 a year earlier, attributed to unrealized losses on available-for-sale securities [8][12] - Total stockholders' equity was $17.8 million, representing 4.96% of total assets, a decline from 5.49% in 2023 [12][41] - The bank maintained a strong capital position with a total risk-based capital ratio of 16.40% as of December 31, 2024, down from 18.40% in 2023 [5][43] Management Commentary - The CEO acknowledged the disappointing financial performance in 2024, citing challenges in the interest rate environment and the need to focus on strategic opportunities for long-term growth [2][6] - The decision to suspend quarterly cash dividends was made to reinvest in the bank's infrastructure and better serve client needs [2][6] - Management remains committed to navigating uncertainties while focusing on organic loan and deposit growth [2][5]