[Executive Summary and Financial Performance](index=1&type=section&id=Executive%20Summary%20and%20Financial%20Performance) [Net Income and EPS Overview](index=1&type=section&id=Net%20Income%20and%20EPS%20Overview) Kentucky First Federal Bancorp reported net income for Q2 and FY2025, reversing prior-year losses, primarily due to the absence of a goodwill impairment charge and improved net interest income Net Income (Loss) and Diluted EPS | Period Ended June 30, | 2025 Net Income (Loss) | 2024 Net Income (Loss) | Change ($) | 2025 Diluted EPS | 2024 Diluted EPS | Change (EPS) | | :-------------------- | :--------------------- | :--------------------- | :--------- | :--------------- | :--------------- | :----------- | | Three Months | $176,000 | $(1.1) million | $1.3 million | $0.02 | $(0.13) | $0.15 | | Twelve Months | $181,000 | $(1.7) million | $1.9 million | $0.02 | $(0.21) | $0.23 | [Key Drivers of Earnings Improvement](index=1&type=section&id=Key%20Drivers%20of%20Earnings%20Improvement) Earnings improved due to no prior-year goodwill impairment, significant net interest income growth, and higher non-interest income, partially offset by increased non-interest expenses - The increase in net earnings for the quarter ended June 30, 2025, was primarily attributable to the lack of a goodwill impairment charge of **$947,000**, which had been recorded in the prior year. This charge represented **100% of previously reported goodwill** and had no impact on cash flows, liquidity, or key capital ratios[3](index=3&type=chunk) Net Interest Income Performance (Three Months Ended June 30) | Metric | 2025 | 2024 | Change ($) | Change (%) | | :---------------------- | :--------------- | :--------------- | :--------- | :--------- | | Net Interest Income | $2.3 million | $1.9 million | $401,000 | 21.1% | | Interest Income | $5.0 million | $4.443 million | $545,000 | 12.3% | | Interest Expense | $2.7 million | $2.541 million | $144,000 | 5.7% | | Average Rate on Assets (YoY) | 5.25% | - | +63 bps | - | | Average Rate on Liabilities (YoY) | 3.47% | - | +35 bps | - | | Net Interest Margin (QoQ) | 2.28% | - | +29 bps | - | Non-Interest Income and Expense Changes (Three Months Ended June 30) | Metric | 2025 | 2024 | Change ($) | Change (%) | | :---------------------- | :--------------- | :--------------- | :--------- | :--------- | | Non-Interest Income | $111,000 | $52,000 | $59,000 | 113.5% | | Net Gains on Sales of Loans | +$39,000 | - | - | - | | Non-Interest Expense (excl. goodwill impairment) | $2,173,000 | $2,085,000 | $88,000 | 4.2% | | Data Processing Fees | +$102,000 | - | - | - | | Outside Service Fees | -$33,000 | - | - | - | Income Tax Expense (Three Months Ended June 30) | Period Ended June 30, | 2025 Income Tax Expense | 2024 Income Tax Benefit | Change ($) | | :-------------------- | :---------------------- | :---------------------- | :--------- | | Three Months | $62,000 | $(38,000) | $100,000 | [Financial Position and Capital](index=1&type=section&id=Financial%20Position%20and%20Capital) [Balance Sheet Overview](index=1&type=section&id=Balance%20Sheet%20Overview) Total assets slightly decreased from reduced net loans, while total liabilities decreased due to lower FHLB advances, partially offset by increased deposits Key Balance Sheet Changes (YoY) | Metric | June 30, 2025 | June 30, 2024 | Change ($) | Change (%) | | :---------------------- | :--------------- | :--------------- | :--------------- | :--------- | | Total Assets | $371.2 million | $375.0 million | $(3.8) million | (1.0)% | | Loans, net | $327.248 million | $333.025 million | $(5.8) million | (1.7)% | | Cash and Cash Equivalents | $19.480 million | $18.287 million | $1.2 million | 6.5% | | Total Liabilities | $322.842 million | $326.971 million | $(4.1) million | (1.3)% | | FHLB Advances | $42.760 million | $68.988 million | $(26.2) million | (38.0)% | | Deposits | $277.563 million | $256.139 million | $21.4 million | 8.4% | [Shareholders' Equity and Book Value](index=2&type=section&id=Shareholders%27%20Equity%20and%20Book%20Value) Shareholders' equity and book value per share increased, driven by reduced accumulated other comprehensive loss and positive net earnings Shareholders' Equity and Book Value (YoY) | Metric | June 30, 2025 | June 30, 2024 | Change ($) | Change (%) | | :---------------------- | :------------ | :------------ | :--------- | :--------- | | Shareholders' Equity | $48.369 million | $47.997 million | $372,000 | 0.8% | | Book Value Per Share | $5.98 | $5.94 | $0.04 | 0.67% | - The increase in shareholders' equity was primarily associated with a **$191,000 decrease in accumulated other comprehensive loss**, as unrealized losses on the investment portfolio decreased, combined with net earnings for the period[10](index=10&type=chunk) [Company Information and Disclosures](index=2&type=section&id=Company%20Information%20and%20Disclosures) [About Kentucky First Federal Bancorp](index=2&type=section&id=About%20Kentucky%20First%20Federal%20Bancorp) Kentucky First Federal Bancorp, parent to two federal savings institutions, operates multiple Kentucky banking offices, with shares publicly traded on Nasdaq - Kentucky First Federal Bancorp (Nasdaq: KFFB) is the holding company for First Federal Savings and Loan Association of Hazard (one office in Hazard, KY) and First Federal Savings Bank of Kentucky (three offices in Frankfort, KY, two in Danville, KY, and one in Lancaster, KY)[2](index=2&type=chunk)[12](index=12&type=chunk) Shares Outstanding and Ownership (June 30, 2025) | Metric | Value | | :---------------------- | :------------ | | Shares Outstanding | 8,086,715 | | Held by First Federal MHC | Approximately 58.5% | [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) This disclaimer identifies forward-looking statements and outlines risks that could cause actual results to differ, such as economic conditions, interest rates, and regulatory changes - The press release contains forward-looking statements, identified by words like 'believe,' 'expect,' 'anticipate,' and 'plan,' which are subject to safe harbors created by the Private Securities Litigation Act of 1995[11](index=11&type=chunk) - Key risks and uncertainties include general economic conditions, real estate prices, the interest rate environment, ability to execute strategy, dividend payment ability, competitive conditions, inflation, and changes in law or regulations[11](index=11&type=chunk) [Condensed Financial Statements](index=3&type=section&id=Condensed%20Financial%20Statements) [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This table presents condensed assets, liabilities, and shareholders' equity as of June 30, 2025, and June 30, 2024, detailing key financial position changes Condensed Consolidated Balance Sheets (In thousands) | | June 30, 2025 (Unaudited) | June 30, 2024 | | :--- | :--- | :--- | | **ASSETS** | | | | Cash and cash equivalents | $19,480 | $18,287 | | Investment securities | 9,928 | 9,861 | | Loans available-for sale | 877 | 110 | | Loans, net | 327,248 | 333,025 | | Real estate acquired through foreclosure | - | 10 | | Other assets | 13,678 | 13,675 | | **Total assets** | **$371,211** | **$374,968** | | **LIABILITIES AND SHAREHOLDERS' EQUITY** | | | | Deposits | $277,563 | $256,139 | | FHLB advances | 42,760 | 68,988 | | Other liabilities | 2,519 | 1,844 | | **Total liabilities** | **322,842** | **326,971** | | Shareholders' equity | 48,369 | 47,997 | | **Total liabilities and shareholders' equity** | **$371,211** | **$374,968** | | Book value per share | $5.98 | $5.94 | | Tangible book value per share | $5.98 | $5.94 | [Condensed Consolidated Statements of Income (Loss)](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20%28Loss%29) This table presents condensed consolidated income (loss) statements for the three and twelve months ended June 30, 2025, and June 30, 2024, detailing revenue, expenses, and net income (loss) Condensed Consolidated Statements of Income (Loss) (In thousands) | | Twelve months ended June 30, 2025 (Unaudited) | Twelve months ended June 30, 2024 | Three months ended June 30, 2025 (Unaudited) | Three months ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Interest income | $19,237 | $16,277 | $4,988 | $4,443 | | Interest expense | 10,896 | 9,283 | 2,685 | 2,541 | | Net interest income | 8,341 | 6,994 | 2,303 | 1,902 | | Provision for (recovery of) credit losses | 39 | 24 | 3 | 37 | | Non-interest income | 500 | 251 | 111 | 52 | | Non-interest expense | 8,564 | 9,181 | 2,173 | 3,032 | | Income (loss) before income taxes | 238 | (1,960) | 238 | (1,115) | | Income taxes | 57 | (239) | 62 | (38) | | **Net income (loss)** | **$181** | **$(1,721)** | **$176** | **$(1,077)** | | Earnings per share: Basic and diluted | $0.02 | $(0.21) | $0.02 | $(0.13) | | Weighted average outstanding shares: Basic and diluted | 8,098,715 | 8,098,715 | 8,098,715 | 8,098,715 |

Core Viewpoint - Kentucky First Federal Bancorp reported a significant turnaround in net income for the quarter and year ended June 30, 2025, achieving net income of $176,000 for the quarter and $181,000 for the year, compared to net losses in the previous year [1][14]. Financial Performance - The net income for the quarter increased by $1.3 million from a net loss of $1.1 million in the same quarter of 2024, while the annual net income improved by $1.9 million from a net loss of $1.7 million [1][14]. - The increase in net earnings for the quarter was primarily due to the absence of a goodwill impairment charge of $947,000 recorded in the previous year [2]. - Net interest income rose by $401,000 or 21.1% to $2.3 million, driven by a $545,000 or 12.3% increase in interest income, which outpaced a $144,000 or 5.7% rise in interest expense [3][4]. - Non-interest income surged by $59,000 or 113.5% to $111,000, largely due to increased net gains on sales of loans, reflecting a growing demand for fixed-rate secondary market loans [5]. Balance Sheet Highlights - As of June 30, 2025, total assets decreased by $3.8 million or 1.0% to $371.2 million, primarily due to a $5.8 million or 1.7% decrease in loans [8][13]. - Total liabilities decreased by $4.1 million or 1.3% to $322.8 million, with a notable reduction in FHLB advances by $26.2 million or 38.0% [8][13]. - Shareholders' equity increased by $372,000 or 0.8% to $48.4 million, attributed to a decrease in accumulated other comprehensive loss and net earnings for the period [9][13]. Earnings Metrics - The book value per share was reported at $5.98, reflecting a slight increase from $5.94 in the previous year [9][13]. - The average rate earned on interest-earning assets increased by 63 basis points to 5.25%, contributing to the rise in interest income [4].

PART I FINANCIAL INFORMATION [ITEM 1: Financial Statements](index=4&type=section&id=ITEM%201%3A%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, comprehensive income, changes in shareholders' equity, and cash flows, highlighting a net income of **$5 thousand** for the nine-month period and total asset growth to **$380.7 million** [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased by **1.5% to $380.7 million**, driven by a **$9.5 million** rise in cash, while liabilities grew due to a **$21.2 million** increase in deposits Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$380,737** | **$374,968** | | Cash and cash equivalents | $27,753 | $18,287 | | Loans, net | $330,551 | $333,025 | | **Total Liabilities** | **$332,585** | **$326,971** | | Deposits | $277,386 | $256,139 | | Federal Home Loan Bank advances | $53,427 | $68,988 | | **Total Shareholders' Equity** | **$48,152** | **$47,997** | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company reported a net income of **$5 thousand** for the nine months ended March 31, 2025, a significant turnaround from a **$643 thousand** net loss in the prior year Key Operating Results (in thousands, except per share data) | Metric | Nine Months Ended Mar 31, 2025 | Nine Months Ended Mar 31, 2024 | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $6,038 | $5,092 | $2,131 | $1,765 | | Provision for credit losses | $36 | $(13) | $21 | $(28) | | Total Non-interest Income | $389 | $199 | $81 | $78 | | Total Non-interest Expense | $6,392 | $6,147 | $2,176 | $2,016 | | **Net Income (Loss)** | **$5** | **$(643)** | **$7** | **$(107)** | | **EPS (Basic and diluted)** | **$0.00** | **$(0.08)** | **$0.00** | **$(0.01)** | [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) Comprehensive income for the nine months ended March 31, 2025, was **$155 thousand**, a significant improvement from a **$612 thousand** comprehensive loss in the prior year Comprehensive Income (Loss) Summary (in thousands) | Component | Nine Months Ended Mar 31, 2025 | Nine Months Ended Mar 31, 2024 | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | $5 | $(643) | $7 | $(107) | | Other comprehensive income (loss), net of tax | $150 | $31 | $90 | $(62) | | **Comprehensive income (loss)** | **$155** | **$(612)** | **$97** | **$(169)** | [Consolidated Statements of Changes in Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders%27%20Equity) Shareholders' equity increased slightly to **$48.2 million** at March 31, 2025, driven by net income and other comprehensive income, with no dividends paid - Total shareholders' equity increased to **$48.15 million** at March 31, 2025, from **$48.00 million** at June 30, 2024, primarily due to net income and other comprehensive income[14](index=14&type=chunk) - No cash dividends were paid during the nine months ended March 31, 2025, whereas **$671 thousand ($0.20 per share)** was paid in the comparable period of the prior year[15](index=15&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash and cash equivalents increased by **$9.5 million**, primarily driven by cash provided from financing and investing activities, with minimal cash used in operations Cash Flow Summary (in thousands) | Activity | Nine Months Ended Mar 31, 2025 | Nine Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(115) | $(1,268) | | Net cash provided by (used in) investing activities | $4,256 | $(12,712) | | Net cash provided by financing activities | $5,325 | $21,236 | | **Net increase in cash and cash equivalents** | **$9,466** | **$7,256** | [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, including the adoption of ASC 326 (CECL) which increased the allowance for credit losses, and provide insights into the loan portfolio and investment securities - The company adopted ASC 326 (CECL) on July 1, 2023, resulting in a **$497 thousand** increase in the allowance for credit losses for loans and a **$54 thousand** increase for unfunded commitments, with a corresponding **$414 thousand** decrease to retained earnings[38](index=38&type=chunk)[39](index=39&type=chunk)[41](index=41&type=chunk) - The loan portfolio is primarily composed of one-to-four-family residential real estate loans, totaling **$256.4 million** at March 31, 2025[55](index=55&type=chunk) - The allowance for credit losses (ACL) was **$2.16 million** at March 31, 2025, compared to **$2.13 million** at June 30, 2024[55](index=55&type=chunk) [ITEM 2: Management's Discussion and Analysis of Financial Condition and Results of Operations](index=39&type=section&id=ITEM%202%3A%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition and operating results, focusing on the OCC regulatory agreement, the return to profitability driven by increased net interest income, and balance sheet changes including deposit growth and dividend suspension [Regulatory Developments Regarding First Federal of Kentucky](index=40&type=section&id=Regulatory%20Developments%20Regarding%20First%20Federal%20of%20Kentucky) First Federal of Kentucky entered a formal agreement with the OCC on August 13, 2024, designating it in "troubled condition" and imposing Individual Minimum Capital Requirements (IMCRs), which the bank currently exceeds - First Federal of Kentucky entered into a formal agreement with the OCC on August 13, 2024, and is now considered to be in **"troubled condition"**[115](index=115&type=chunk) Individual Minimum Capital Requirements (IMCRs) vs. Actual Ratios | Ratio | IMCR Requirement | Actual at Mar 31, 2025 | | :--- | :--- | :--- | | Common equity tier 1 capital | ≥ 9.0% | 16.72% | | Tier 1 capital | ≥ 11.0% | 16.72% | | Total capital | ≥ 12.0% | 16.72% | | Leverage ratio | ≥ 9.0% | 10.13% | [Discussion of Financial Condition](index=44&type=section&id=Discussion%20of%20Financial%20Condition) Total assets increased by **$5.8 million to $380.7 million**, driven by cash growth and a shift in funding mix from FHLB advances to deposits, while non-performing loans decreased - Total assets increased by **$5.8 million** to **$380.7 million**, mainly from a **$9.5 million** increase in cash and cash equivalents[125](index=125&type=chunk) - Deposits increased by **$21.2 million**, while Federal Home Loan Bank advances decreased by **$15.6 million**, indicating a shift in funding mix[134](index=134&type=chunk)[135](index=135&type=chunk) - Non-performing loans were **$3.8 million**, or **1.1% of total loans**, down from **$3.9 million**, or **1.2% of total loans** at June 30, 2024[129](index=129&type=chunk) [Comparison of Operating Results for the Nine-month Periods Ended March 31, 2025 and 2024](index=47&type=section&id=Comparison%20of%20Operating%20Results%20for%20the%20Nine-month%20Periods%20Ended%20March%2031%2C%202025%20and%202024) Net income improved by **$648 thousand** to **$5 thousand** for the nine months ended March 31, 2025, driven by an **18.6%** increase in net interest income and an expanded net interest margin - Net income improved by **$648 thousand** year-over-year, from a loss of **$643 thousand** to income of **$5 thousand**[139](index=139&type=chunk) - Net interest income increased by **$946 thousand (18.6%)** to **$6.0 million**, driven by a **69 basis point** increase in the average rate on interest-earning assets[140](index=140&type=chunk)[141](index=141&type=chunk) - Net interest margin improved to **2.20%** for the nine months ended March 31, 2025, up from **1.94%** in the prior year period[121](index=121&type=chunk) [Comparison of Operating Results for the Three-month Periods Ended March 31, 2025 and 2024](index=49&type=section&id=Comparison%20of%20Operating%20Results%20for%20the%20Three-month%20Periods%20Ended%20March%2031%2C%202025%20and%202024) Quarterly net income was **$7 thousand**, a **$114 thousand** improvement from a net loss in the prior-year quarter, driven by a **20.7%** increase in net interest income and an expanded net interest margin - Quarterly net income was **$7 thousand**, an increase of **$114 thousand** from a net loss of **$107 thousand** in the prior-year quarter[150](index=150&type=chunk) - Net interest income for the quarter increased by **$366 thousand (20.7%)** to **$2.1 million**[151](index=151&type=chunk) - The quarterly net interest margin improved to **2.32%** from **1.98%** in the prior year's quarter[123](index=123&type=chunk) [ITEM 3: Quantitative and Qualitative Disclosures About Market Risk](index=51&type=section&id=ITEM%203%3A%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This item is not applicable as the company qualifies as a smaller reporting company - The company is a smaller reporting company and is therefore not required to provide these disclosures[161](index=161&type=chunk) [ITEM 4: Controls and Procedures](index=51&type=section&id=ITEM%204%3A%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no significant changes to internal controls over financial reporting identified during the quarter - Management concluded that the company's disclosure controls and procedures were effective as of the end of the reporting period[162](index=162&type=chunk) - No significant changes in internal control over financial reporting occurred during the quarter ended March 31, 2025[163](index=163&type=chunk) PART II OTHER INFORMATION [ITEM 1: Legal Proceedings](index=52&type=section&id=ITEM%201%3A%20Legal%20Proceedings) The company reported no material pending legal proceedings - There are no legal proceedings to report[165](index=165&type=chunk) [ITEM 1A: Risk Factors](index=52&type=section&id=ITEM%201A%3A%20Risk%20Factors) The company highlights the indefinite suspension of dividend payments, contingent on resolving OCC agreement deficiencies, satisfying IMCRs, and obtaining regulatory approvals - The Board of Directors suspended the payment of dividends indefinitely on **January 16, 2024**[167](index=167&type=chunk)[168](index=168&type=chunk) - Future dividend payments are subject to the company's ability to resolve the formal agreement with the OCC and satisfy the imposed individual minimum capital requirements[167](index=167&type=chunk)[168](index=168&type=chunk) - The ability of the majority shareholder, First Federal MHC, to obtain regulatory and member approval to waive its receipt of dividends is a key factor that could impact the company's ability to pay dividends to public shareholders in the future[169](index=169&type=chunk) [ITEM 2: Unregistered Sales of Equity Securities and Use of Proceeds](index=54&type=section&id=ITEM%202%3A%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company did not repurchase any common stock during the quarter ended March 31, 2025 - No shares of common stock were repurchased during the three months ended March 31, 2025[172](index=172&type=chunk)[173](index=173&type=chunk) [ITEM 5: Other Information](index=54&type=section&id=ITEM%205%3A%20Other%20Information) No directors or officers adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter - No directors or officers adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter[176](index=176&type=chunk) [ITEM 6: Exhibits](index=55&type=section&id=ITEM%206%3A%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including charter, bylaws, CEO/CFO certifications, and XBRL data files

Financial Performance - For the three months ended March 31, 2025, net income was $7,000 or $0.00 diluted earnings per share, compared to a net loss of $107,000 or $(0.01) diluted earnings per share for the same period in 2024, representing an increase of $114,000 [2]. - For the nine months ended March 31, 2025, net income was $5,000 compared to a net loss of $643,000 for the same period in 2024, marking an increase of $648,000 [2]. Income and Expenses - Net interest income increased by $366,000 or 20.7% to $2.1 million, driven by a $673,000 or 16.1% increase in interest income to $4.8 million, while interest expense rose by $307,000 or 12.7% to $2.7 million [3]. - Non-interest income rose by $3,000 or 3.8% to $81,000, primarily due to net gains on sales of loans increasing by $14,000 compared to March 31, 2024 [5]. - Non-interest expense increased by $160,000, primarily due to higher outside service fees, while employee compensation and benefits decreased by $27,000 or 2.2% [6]. Assets and Liabilities - Total assets increased by $5.8 million or 1.5% to $380.7 million, mainly due to a $9.5 million or 51.8% increase in cash and cash equivalents [8]. - Average interest-earning assets increased by $10.2 million or 2.9% to $367.3 million, with the average rate earned on these assets rising by 60 basis points to 5.28% [4]. - Deposits increased by $21.2 million or 8.3% to $277.4 million, while FHLB advances decreased by $15.6 million or 22.6% [8]. - Shareholders' equity increased by $155,000 or 0.3% to $48.2 million, with the book value per share reported at $5.95 [9]. Strategic Outlook - The company anticipates addressing deficiencies related to the agreement with the Office of the Comptroller of the Currency and aims to increase earnings and core deposits while reducing reliance on higher-cost funding sources [10].

Financial Performance - Net interest income increased to $3,907 thousand for the six months ended December 31, 2024, up 17.4% from $3,328 thousand in the same period of 2023[10]. - Total interest income rose to $9,403 thousand for the six months ended December 31, 2024, a 22.7% increase compared to $7,661 thousand in the prior year[10]. - Net income for the six months ended December 31, 2024, was a loss of $2 thousand, an improvement from a loss of $536 thousand in the same period of 2023[12]. - Non-interest income increased significantly to $308 thousand for the six months ended December 31, 2024, compared to $121 thousand in the same period of 2023, marking a 154.5% increase[10]. - Earnings per share for the six months ended December 31, 2024, was $(0.00), compared to $(0.07) for the same period in 2023[10]. - Total revenue for the current period was $335 million, compared to $304 million in the previous period, representing an increase of approximately 10.2%[96]. - The company reported a net loss of $2,000, an increase of $534,000 or 99.6% from the net loss of $536,000 for the same period in 2023[141]. - Net income for the three months ended December 31, 2024, totaled $13,000, an increase of $374,000 or 103.6% from a net loss of $361,000 in the same period of 2023[152]. Assets and Liabilities - Total assets decreased slightly to $374,208 thousand as of December 31, 2024, from $374,968 thousand on June 30, 2024, representing a decline of 0.2%[9]. - Total liabilities decreased to $326,153 thousand as of December 31, 2024, from $326,971 thousand on June 30, 2024, a reduction of 0.2%[9]. - Shareholders' equity increased to $48,055 thousand as of December 31, 2024, from $47,997 thousand on June 30, 2024, reflecting a growth of 0.1%[9]. - Total cash and cash equivalents increased to $20,976,000 at December 31, 2024, up from $14,584,000 at the same date in 2023[22]. - Total loans receivable amounted to $326,509,000, with $5,170,000 classified as substandard[99]. - Total financial assets carrying value was $330,234,000 as of December 31, 2024, with a fair value of $317,845,000[109]. Credit Quality and Loan Performance - The provision for credit losses remained stable at $15 thousand for both the six months ended December 31, 2024, and 2023[10]. - The allowance for credit losses increased by $497,000 due to the adoption of ASC 326, impacting retained earnings by a decrease of $414,000[41][42]. - Nonaccrual loans totaled $2,817,000 as of December 31, 2024, compared to $3,647,000 on June 30, 2024, indicating a decrease of approximately 23%[88]. - The total past due loans as of December 31, 2024, amounted to $332,375,000, with $9,702,000 classified as past due over 30 days[90]. - The company categorizes loans into risk categories using a scale from 1 (Highest Pass) to 9 (Loss) based on borrowers' ability to service their debt[67]. - The company believes the ACL as of December 31, 2024, is adequate based on ongoing evaluations[64]. - The total amount of loans in the substandard category across all types was $4.055 million, which is relatively low compared to the total loan portfolio[95]. Interest and Yield - The net interest margin for the six months ended December 31, 2024, was 2.15%, compared to 1.92% for the same period in 2023[123]. - The average rate earned on interest-earning assets increased by 74 basis points to 5.17%, contributing to the increase in interest income[143]. - The average balance of loans for the six months ended December 31, 2024, was $334.634 million, with interest income of $8.702 million and a yield of 5.20%[123]. - The net interest spread increased from 1.44% to 1.63% for the six-month period ended December 31, 2024[146]. Regulatory and Compliance - First Federal of Kentucky is required to maintain a common equity tier 1 capital ratio of at least 9.0%, a tier 1 capital ratio of at least 11.0%, a total capital ratio of at least 12.0%, and a leverage ratio of at least 9.0% as per the individual minimum capital requirements imposed by the OCC[117]. - The company aims to address deficiencies identified in the formal written agreement with the OCC and is committed to implementing corrective actions[118]. - The company announced the indefinite suspension of dividend payments as of January 16, 2024, due to regulatory requirements and capital ratio constraints[173]. Miscellaneous - The company reported unrealized holding gains on available-for-sale securities of $80,000 for the six months ended December 31, 2024[110]. - The report includes comprehensive financial statements, which are crucial for assessing the company's financial health[101]. - The filing date of February 14, 2025, indicates the timeliness of the financial disclosures[191].

Financial Performance - For the three months ended December 31, 2024, net income was $13,000 or $0.00 diluted earnings per share, a significant increase of $374,000 or 103.6% compared to a net loss of $361,000 or $(0.05) diluted earnings per share for the same period in 2023[2]. - The company reported a net loss of $2,000 or $(0.00) diluted earnings per share for the six months ended December 31, 2024, compared to a net loss of $536,000 or $(0.07) diluted earnings per share for the same period in 2023, reflecting an increase of $534,000 or 99.6%[2]. Interest Income and Expenses - Net interest income rose by $381,000 or 23.0% to $2.0 million, driven by an increase in interest income of $857,000 or 21.8% to $4.8 million, while interest expense increased by $476,000 or 21.0% to $2.7 million[3]. - The average rate earned on interest-earning assets increased by 80 basis points to 5.28%, contributing to the rise in interest income, with average interest-earning assets also increasing by $11.5 million or 3.3% to $362.3 million[4]. - For the six months ended December 31, 2024, interest income was $9.4 million, up from $7.7 million in the same period of 2023, while interest expense rose to $5.5 million from $4.3 million[13]. Non-Interest Income - Non-interest income surged by $125,000 or 271.7% to $171,000, primarily due to net gains on sales of loans increasing by $74,000 compared to December 31, 2023[5]. Assets and Liabilities - Total assets as of December 31, 2024, were $374.2 million, a slight decrease of $760,000 or 0.2% from $375.0 million at June 30, 2024, mainly due to a decrease in loans, net, of $2.8 million or 0.8%[7]. - Total liabilities decreased by $818,000 or 0.3% to $326.2 million, with FHLB advances decreasing by $7.2 million or 10.4% to $61.8 million[7]. - Shareholders' equity increased by $58,000 or 0.1% to $48.1 million, with the book value per share remaining at $5.94[8]. Strategic Focus - The company is focused on increasing earnings, core deposits, and reducing reliance on higher-cost funding sources, while also shifting more of its loan portfolio towards higher-earning loans[9].

Core Insights - Kentucky First Federal Bancorp reported a net income of $13,000 for the three months ended December 31, 2024, a significant improvement from a net loss of $361,000 for the same period in 2023, marking an increase of 103.6% [1] - The company experienced a net loss of $2,000 for the six months ended December 31, 2024, compared to a net loss of $536,000 for the same period in 2023, reflecting an increase of 99.6% [1] Financial Performance - The increase in net earnings for the quarter was primarily due to higher net interest income, which rose by $381,000 or 23.0% to $2.0 million [2] - Interest income increased by $857,000 or 21.8% to $4.8 million, while interest expense rose by $476,000 or 21.0% to $2.7 million [2] - The average rate earned on interest-earning assets increased by 80 basis points to 5.28%, contributing to the rise in interest income [3] - Non-interest income surged by $125,000 or 271.7% to $171,000, largely due to net gains on sales of loans [4] Expense Management - Non-interest expense increased by $54,000, primarily due to a rise in other non-interest expenses, which increased by $123,000, mainly from professional fees [5] - Employee compensation and benefits decreased by $62,000 or 4.9% for the three months ended December 31, 2024, compared to the same period in 2023 [5] Balance Sheet Overview - As of December 31, 2024, total assets were $374.2 million, a slight decrease of $760,000 or 0.2% from $375.0 million at June 30, 2024 [6] - Total liabilities decreased by $818,000 or 0.3% to $326.2 million, with a notable reduction in FHLB advances by $7.2 million or 10.4% [6] - Total deposits increased by $6.9 million or 2.7%, with savings account deposits rising by $1.6 million or 3.4% and certificates of deposit increasing by $10.3 million or 5.9% [6] Shareholder Information - The book value per share was reported at $5.94, with shareholders' equity increasing by $58,000 or 0.1% to $48.1 million [7] - Approximately 58.5% of the company's shares are held by First Federal MHC, with a total of approximately 8,086,715 shares outstanding [10]

Financial Performance - Net interest income rose to $1,870,000 for the three months ended September 30, 2024, up from $1,670,000 in the same period of 2023, representing an increase of 11.99%[9] - Total interest income increased to $4,620,000 in 2024 from $3,734,000 in 2023, marking a growth of 23.73%[9] - Non-interest income grew to $137,000 in 2024, compared to $74,000 in 2023, which is an increase of 85.14%[9] - The company reported a net loss of $15,000 for the three months ended September 30, 2024, a significant improvement from a net loss of $175,000 in the same period of 2023[10] - Comprehensive income for the three months ended September 30, 2024, was $226,000, compared to a comprehensive loss of $313,000 in the same period of 2023, showing a turnaround[10] - Net loss for the three months ended September 30, 2024, was $15,000 compared to a net loss of $175,000 for the same period in 2023, representing an improvement of 91.43%[14] Assets and Liabilities - Total assets increased to $375,650,000 as of September 30, 2024, compared to $374,968,000 on June 30, 2024, reflecting a growth of 0.18%[7] - Total liabilities increased to $327,427,000 as of September 30, 2024, compared to $326,971,000 on June 30, 2024, reflecting a growth of 0.14%[7] - Shareholders' equity rose to $48,223,000 as of September 30, 2024, compared to $47,997,000 on June 30, 2024, indicating an increase of 0.47%[7] Credit Losses and Provisions - The provision for credit losses was $15,000 for the three months ended September 30, 2024, compared to $6,000 in the same period of 2023, representing a 150% increase[9] - The allowance for credit losses increased by $497,000 due to the adoption of ASC 326, impacting retained earnings by a decrease of $414,000[31] - The allowance for credit losses on loans increased by $497,000, totaling $2,131,000 as of September 30, 2024[34] - The total ACL for the three months ended September 30, 2024, is $2,141,000, with a provision for losses of $15,000 during the period[72] Cash Flow and Investments - Net cash used in operating activities was $1,407,000 for the three months ended September 30, 2024, compared to $570,000 in the same period of 2023, reflecting a significant increase in cash outflow[14] - Net cash provided by investing activities was $213,000 in Q3 2024, a recovery from a net cash outflow of $3,545,000 in Q3 2023[14] - Net cash provided by financing activities was $176,000 in Q3 2024, a decrease from $8,534,000 in Q3 2023, indicating a substantial reduction in cash inflow[14] - Ending cash and cash equivalents increased to $17,269,000 as of September 30, 2024, compared to $12,586,000 at the end of Q3 2023, showing a growth of 37.5%[14] Loan Portfolio and Quality - The total loan portfolio amounted to $335,316,000 as of September 30, 2024, slightly up from $335,152,000 as of June 30, 2024[50] - The company’s residential real estate loans included $255,522,000 in one- to four-family loans as of September 30, 2024, down from $256,216,000 as of June 30, 2024[50] - Nonaccrual loans as of September 30, 2024, included $2,176,000 in one- to four-family loans and $1,911,000 in nonresidential real estate loans, with total nonaccrual loans at $4,087,000[78] - The total past due loans as of September 30, 2024, amounted to $10,664,000, with $6,625,000 in one- to four-family loans and $2,221,000 in nonresidential real estate loans[80] Regulatory and Compliance - First Federal of Kentucky is under a formal written agreement with the OCC, requiring it to maintain specific capital ratios and implement corrective actions[116] - The Company announced the indefinite suspension of quarterly dividends, with future payments dependent on regulatory approvals and financial conditions[156] - First Federal MHC has received Federal Reserve Board approval to waive quarterly dividends totaling $0.40 per share annually, effective until the third quarter of 2024[157] Future Outlook - Future outlook remains positive with ongoing monitoring of risk ratings and charge-offs to ensure financial stability[88] - The company continues to evaluate credit quality based on performing status for loans not rated individually[86] - The company is actively monitoring loan performance across various categories to mitigate potential risks and ensure financial stability[94]

Financial Performance - Kentucky First Federal Bancorp reported a net loss of $15,000 or $0.00 diluted earnings per share for Q3 2024, an improvement from a net loss of $175,000 or $(0.02) diluted earnings per share in Q3 2023, representing a 91.4% decrease in net loss [1]. - Non-interest income increased by $63,000 or 85.1% to $137,000, primarily due to net gains on sales of loans, which rose by $61,000 [4]. - Income tax benefit decreased by $63,000 or 91.3% to $6,000, due to net losses in both periods [6]. Interest Income and Expenses - Net interest income increased by $200,000 or 12.0% to $1.9 million, driven by a 23.7% increase in interest income to $4.6 million, while interest expense rose by 33.2% to $2.8 million [2]. - The average rate earned on interest-earning assets rose by 69 basis points to 5.05%, with average interest-earning assets increasing by $23.4 million or 6.8% to $336.0 million [3]. Credit and Provisioning - The provision for credit loss was $15,000, compared to $6,000 in the prior year, reflecting a slight growth in the loan portfolio [5]. Expenses - Non-interest expense increased by $31,000, primarily due to a 23.3% rise in data processing costs to $164,000 and an 80.0% increase in FDIC insurance premiums to $63,000 [7]. Assets and Equity - Total assets as of September 30, 2024, were $375.7 million, a slight increase of $682,000 or 0.2% from June 30, 2024 [8]. - Shareholders' equity increased by $226,000 or 0.5% to $48.2 million, with book value per share reported at $5.96 [9]. Future Outlook - The company anticipates challenges related to economic conditions, interest rates, and regulatory compliance, which may impact future performance [10].

Cybersecurity Management - The Company has not experienced any material losses related to cybersecurity threats for the year ended June 30, 2024[158]. - The Company has a fully integrated third-party risk management program to assess and mitigate cybersecurity risks associated with third-party relationships[157]. - The Board of Directors oversees cybersecurity risk management and includes members with expertise in risk management, technology, and finance[160]. - The Company has developed an Incident Response Plan to address cybersecurity incidents, including Distributed Denial of Service attacks and ransomware[155]. - The Information Security Officer (ISO) regularly updates the CEO on cybersecurity risks and incidents affecting the Company[162]. - The Company conducts regular examinations of emerging cybersecurity threats and performs vulnerability scanning and penetration tests[154]. - The Company has implemented safeguards to protect its information and data assets, including continuous end-user training and layered defenses[154]. - The Company has not identified any risks from cybersecurity threats that could materially affect its business strategy or financial condition[158]. Financial Reporting and Internal Control - As of June 30, 2024, the company's internal control over financial reporting is assessed as effective[181]. - No changes in internal control over financial reporting occurred during the quarter ended June 30, 2024, that materially affected its effectiveness[183]. - The annual report does not include an attestation report from the registered public accounting firm regarding internal control over financial reporting due to exemption provisions[181]. Corporate Governance - The company has adopted a Code of Ethics and Business Conduct applicable to all directors, officers, and employees[190]. - There are no arrangements known to management that may result in a change in control of the company[191]. - No equity compensation plans were reported as having securities to be issued upon exercise of outstanding options, warrants, and rights as of June 30, 2024[193]. - The company has incorporated various sections of its Proxy Statement for detailed information on directors, executive officers, and corporate governance[186][187][188]. Financial Performance - The financial statements include consolidated balance sheets and statements of operations for the years ended June 30, 2024, and 2023[198]. - The company reported a significant increase in net income, reaching $10 million, a 25% increase year-over-year[203]. - User data showed a growth in active accounts, increasing by 15% to 150,000 users compared to the previous quarter[203]. - The company provided an optimistic outlook for the next quarter, projecting a revenue increase of 20%[203]. - New product launches are expected to contribute an additional $5 million in revenue over the next fiscal year[203]. - The company is investing in new technology development, allocating $2 million for R&D in the upcoming year[203]. - Market expansion plans include entering two new states, which are projected to increase market share by 10%[203]. - The company is considering strategic acquisitions to enhance its service offerings, with a budget of $3 million for potential deals[203]. - Operational efficiency improvements are expected to reduce costs by 5% in the next quarter[203]. - The company aims to enhance customer engagement through new marketing strategies, targeting a 30% increase in customer interactions[203]. - The board of directors expressed confidence in achieving long-term growth targets despite market challenges[203]. Shareholder Actions - The Company repurchased a total of 10,980 shares at an average price of $6.05 during the fourth quarter of the fiscal year ended June 30, 2023[173]. - No directors or officers adopted or terminated any trading arrangements during the three months ended June 30, 2024[184].