Financial Data and Key Metrics Changes - In the fourth quarter, the company originated $29.4 million of loans held for investment, a 5% increase from $27.9 million in the prior quarter [5] - Loan principal payments and payoffs increased by 83% to $42 million from $23 million in the previous quarter [5] - The outstanding balance of loans held for investment decreased by $13.2 million from the previous quarter [9] - The net interest margin decreased by eight basis points to 2.94% compared to 3.02% in the prior quarter [9] - The average cost of deposits increased to 1.33%, up seven basis points, while the cost of borrowing increased to 4.58% [9] Business Line Data and Key Metrics Changes - Loans held for investment decreased primarily in multifamily, commercial real estate, and commercial business loans, partially offset by a small increase in single-family loans [6] - The company continues to see moderate activity in loans held for investment despite cautious behavior from real estate investors [6] - The weighted average rate of loans originated in June was 6.69%, compared to 5.16% for loans held for investment as of June 30, 2025 [10] Market Data and Key Metrics Changes - The company is monitoring commercial real estate loans, particularly those secured by office buildings, with a total exposure of $39.5 million, representing 3.8% of loans held for investment [7] - The company has approximately $117 million of loans repricing in September and $98 million repricing in December, both expected to increase by 15 basis points [11][27] Company Strategy and Development Direction - The company aims for disciplined growth of the loan portfolio, recognizing the shift in monetary policy and the reversal of the inverted yield curve [13] - The strategy includes maintaining cash dividends and utilizing stock buyback programs as a responsible capital management tool [15] - The company is focused on improving operating efficiencies to lower operating expenses, with a projected run rate of $7.6 million to $7.8 million per quarter for fiscal 2026 [12][13] Management's Comments on Operating Environment and Future Outlook - Management noted that current credit quality remains strong, with nonperforming assets unchanged at $1.4 million [6] - The company is optimistic about the future, suggesting opportunities for expansion of the net interest margin in the upcoming quarters [12] - Management indicated that the mix of loans may shift based on performance, with a preference for a balanced portfolio of single-family and multifamily loans [19] Other Important Information - The company repurchased approximately 76,000 shares of common stock in June and distributed about $3.8 million in cash dividends to shareholders for the fiscal year [15][16] - The company has exceeded well-capitalized capital ratios, allowing for the execution of its business plan without complications [14] Q&A Session Summary Question: Has the recent uptick in prepayments shifted your view on portfolio mix or originations? - Management indicated that they prefer a 50% mix of single-family and multifamily loans but will adjust based on performance, noting recent strength in multifamily and commercial real estate [19] Question: Is there an efficiency ratio that you target? - Management stated that the current operating expense baseline can support future growth, and as the loan portfolio grows, the efficiency ratio is expected to improve over time [21] Question: Is the increased payout this quarter a function of increased competition? - Management responded that both pricing and structure are factors, with tighter underwriting characteristics contributing to credit quality [25] Question: What is the dollar value of loans repricing in the next two quarters? - Management confirmed approximately $117 million repricing in September and $98 million in December, with specific interest rates provided [27][28] Question: What is the seasonality of operating expenses? - Management noted that March typically sees higher operating expenses due to employer taxes, while July 1 sees merit increases impacting future quarters [28][29] Question: What is the range of the loan deposit ratio? - Management explained that a higher loan to deposit ratio is typical for their business model, with a recent reduction from the 120s to the mid-one teens [30][32]

Financial Performance - Net income decreased approximately 12%[17] - Pre-Provision, Pre-Tax Income decreased approximately 5%[17] - Net Interest Income decreased approximately 4%[17] - Non-Interest Income decreased approximately 3%[17] - Operating Expenses decreased approximately 3%[17] - Net Interest Margin decreased eight basis points to 2.94%[17] Balance Sheet & Asset Quality - Loans Held for Investment balance decreased approximately 1%[41] - Total Deposits balance decreased approximately 1%[41] - Total Borrowings balance decreased approximately 1%[41] - Non-Performing Assets to Total Assets Ratio was unchanged at 0.11%[60] Capital Management - The company purchased approximately 76,000 shares of common stock in the fourth quarter of fiscal 2025[90]

[Financial Performance Summary](index=1&type=section&id=Financial%20Performance%20Summary) [Q4 & Fiscal Year 2025 Performance Overview](index=1&type=section&id=Q4%20%26%20Fiscal%20Year%202025%20Performance%20Overview) Provident Financial Holdings reported net income of $1.63 million for Q4 2025, a 17% decrease year-over-year and a 12% decrease sequentially. For the full fiscal year 2025, net income was $6.26 million, down 15% from fiscal 2024. The decline was primarily driven by lower non-interest income and higher non-interest expenses, which were partially offset by increased net interest income and credit loss recoveries. Despite a quarterly dip in loan portfolio growth due to prepayments, the company noted improved fundamentals such as a better net interest margin, stabilized deposits, and reduced borrowings Q4 FY2025 vs. Q4 FY2024 Performance | Metric | Q4 2025 | Q4 2024 | Change | | :--- | :--- | :--- | :--- | | Net Income | $1.63 million | $1.95 million | -17% | | Diluted EPS | $0.24 | $0.28 | -14.3% | Fiscal Year 2025 vs. Fiscal Year 2024 Performance | Metric | FY 2025 | FY 2024 | Change | | :--- | :--- | :--- | :--- | | Net Income | $6.26 million | $7.35 million | -15% | | Diluted EPS | $0.93 | $1.06 | -12% | Q4 FY2025 vs. Q3 FY2025 (Sequential) Performance | Metric | Q4 2025 | Q3 2025 | Change | | :--- | :--- | :--- | :--- | | Net Income | $1.63 million | $1.86 million | -12% | | Diluted EPS | $0.24 | $0.28 | -14% | - CEO Donavon P. Ternes highlighted an improved operating environment in fiscal 2025, citing **better net interest margin**, **stabilized deposit balances**, **declining borrowings**, and **strong credit quality**, despite a temporary interruption in loan portfolio growth due to prepayments[3](index=3&type=chunk) [Detailed Financial Analysis](index=2&type=section&id=Detailed%20Financial%20Analysis) The company's financial performance in Q4 2025 was shaped by several key factors. Net interest income grew 5% year-over-year to $8.88 million, benefiting from a 20 basis point expansion in net interest margin to 2.94%. However, non-interest income fell 40% due to the absence of a prior-year gain, while non-interest expenses rose 6% on higher salary costs. A recovery of credit losses of $164,000 was recorded, compared to a smaller recovery in the prior year [Net Interest Income](index=2&type=section&id=Net%20Interest%20Income) Net interest income for Q4 2025 increased by 5% year-over-year to $8.88 million, driven by a 20 basis point rise in net interest margin to 2.94%. This improvement stemmed from a 16 basis point increase in the average yield on interest-earning assets and a 6 basis point decrease in average funding costs. The positive margin impact was partially offset by a 2% decrease in the average balance of interest-earning assets. Interest income on loans grew due to higher yields, while interest expense on deposits increased due to a shift towards higher-cost time deposits Net Interest Income and Margin (Q4 FY2025 vs. Q4 FY2024) | Metric | Q4 2025 | Q4 2024 | Change | | :--- | :--- | :--- | :--- | | Net Interest Income | $8.88 million | $8.45 million | +5% | | Net Interest Margin | 2.94% | 2.74% | +20 bps | | Avg. Yield on Interest-Earning Assets | 4.67% | 4.51% | +16 bps | | Avg. Funding Costs | 1.91% | 1.97% | -6 bps | - Interest income on loans receivable increased by **2% to $13.10 million**, as a **13 basis point increase** in the average loan yield (to **4.97%**) offset a **1% decrease** in the average loan balance[9](index=9&type=chunk)[10](index=10&type=chunk) - Interest expense on deposits rose **5% to $2.98 million**, primarily due to a **6 basis point increase** in the average cost of deposits to **1.33%**, reflecting a larger proportion of higher-rate time deposits[15](index=15&type=chunk) - Interest expense on borrowings decreased **15% to $2.24 million**, driven by an **11% decrease** in the average balance of borrowings and a **26 basis point reduction** in their average cost[17](index=17&type=chunk) [Provision for Credit Losses](index=4&type=section&id=Provision%20for%20Credit%20Losses) In Q4 2025, the company recorded a recovery of credit losses of $164,000, an improvement from a $12,000 recovery in the same quarter last year. The recovery was primarily attributed to a decline in the balance of loans held for investment and lower historical loss rates - A recovery of credit losses of **$164,000** was recorded in Q4 2025, compared to a **$12,000 recovery** in Q4 2024[19](index=19&type=chunk) - The recovery was mainly due to a **decrease in the loans held for investment balance** and **lower historical loss rates** compared to the prior quarter[19](index=19&type=chunk) [Non-Interest Income](index=5&type=section&id=Non-Interest%20Income) Non-interest income for Q4 2025 decreased significantly by 40% to $880,000 from $1.47 million in the prior-year quarter. The primary reason for this decline was the absence of a $540,000 net unrealized gain on other equity investments that was recorded in Q4 2024 - Non-interest income fell by **$587,000 (40%)** year-over-year, primarily because a **$540,000 net unrealized gain** from the prior year's quarter was not repeated[23](index=23&type=chunk) [Non-Interest Expense](index=5&type=section&id=Non-Interest%20Expense) Non-interest expense in Q4 2025 increased by 6% year-over-year to $7.62 million. The rise was mainly due to a $352,000 increase in salaries and employee benefits and a $103,000 increase in other operating expenses. Sequentially, expenses decreased by 3% due to a non-recurring litigation settlement in the previous quarter. The efficiency ratio worsened to 78.06% from 72.31% a year ago - Non-interest expense increased by **$448,000 (6%)** year-over-year, driven by higher **salaries and employee benefits (+ $352,000)** and **other operating expenses (+ $103,000)**[24](index=24&type=chunk) - The efficiency ratio increased to **78.06%** in Q4 2025, compared to **72.31%** in Q4 2024 and **77.64%** in Q3 2025[25](index=25&type=chunk) [Income Taxes](index=5&type=section&id=Income%20Taxes) The provision for income taxes was $680,000 for Q4 2025, representing a 16% decrease from the same quarter last year. The decline was a direct result of lower pre-tax income. The effective tax rate for the quarter was 29.5%, slightly higher than the 29.2% in the prior-year quarter Income Tax Provision and Effective Rate | Metric | Q4 2025 | Q4 2024 | Q3 2025 | | :--- | :--- | :--- | :--- | | Provision for Income Taxes | $680,000 | $805,000 | $797,000 | | Effective Tax Rate | 29.5% | 29.2% | 30.0% | [Balance Sheet and Asset Quality](index=1&type=section&id=Balance%20Sheet%20and%20Asset%20Quality) [Balance Sheet Analysis](index=1&type=section&id=Balance%20Sheet%20Analysis) As of June 30, 2025, total assets stood at $1.25 billion. Loans held for investment decreased by 1% year-over-year to $1.05 billion. Total deposits remained virtually unchanged at $888.8 million, though there was a compositional shift from core deposits to higher-cost time deposits. Borrowings decreased, and the company maintained a strong liquidity position with $474.8 million in total available borrowing capacity Key Balance Sheet Items (as of June 30, 2025) | Metric | June 30, 2025 | June 30, 2024 | Change | | :--- | :--- | :--- | :--- | | Total Assets | $1.246 billion | $1.272 billion | -2.0% | | Loans Held for Investment, Net | $1.046 billion | $1.053 billion | -0.7% | | Total Deposits | $888.8 million | $888.3 million | ~0% | | Total Borrowings | $213.1 million | $238.5 million | -10.6% | | Total Stockholders' Equity | $128.5 million | $129.9 million | -1.1% | - Core deposits decreased by **6% to $576.5 million**, while time deposits increased by **14% to $312.3 million**, indicating a shift in deposit mix[16](index=16&type=chunk) - The company had total available borrowing capacity of approximately **$474.8 million** at June 30, 2025, from sources including the FHLB and the Federal Reserve Bank[18](index=18&type=chunk) [Asset Quality](index=4&type=section&id=Asset%20Quality) Asset quality showed significant improvement year-over-year. Non-performing assets decreased by 46% to $1.4 million, representing just 0.11% of total assets at June 30, 2025, down from 0.20% a year earlier. The allowance for credit losses on loans decreased to $6.4 million (0.62% of gross loans) from $7.1 million (0.67% of gross loans), primarily due to improved qualitative factors and lower historical loss rates. No loan charge-offs occurred during the quarter Asset Quality Indicators | Metric | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Non-Performing Assets | $1.4 million | $2.6 million | | Non-Performing Assets to Total Assets | 0.11% | 0.20% | | Allowance for Credit Losses on Loans | $6.4 million | $7.1 million | | Allowance as % of Gross Loans | 0.62% | 0.67% | - Non-performing loans at June 30, 2025, consisted of **seven single-family loans** and **one multi-family loan**. The bank had **no real estate owned (REO)**[20](index=20&type=chunk) - **No loan charge-offs** were recorded during the quarters ended June 30, 2025, and 2024[21](index=21&type=chunk) [Capital Management](index=6&type=section&id=Capital%20Management) [Share Repurchases and Dividends](index=6&type=section&id=Share%20Repurchases%20and%20Dividends) The company remained active in its capital return program. During the fourth quarter of fiscal 2025, it repurchased 76,104 shares at an average price of $15.00. For the full fiscal year, 285,170 shares were repurchased. The company also maintained its quarterly cash dividend at $0.14 per share - In Q4 2025, the Company repurchased **76,104 shares** of its common stock at an average cost of **$15.00 per share**[28](index=28&type=chunk) - For the full fiscal year 2025, a total of **285,170 shares** were repurchased at an average cost of **$15.04 per share**[28](index=28&type=chunk) - As of June 30, 2025, **217,028 shares** remained available for repurchase under the current program[28](index=28&type=chunk) - A cash dividend of **$0.14 per share** was declared for the quarter, consistent with the prior year's quarter and the full fiscal year's dividend of **$0.56 per share**[40](index=40&type=chunk) [Financial Statements and Highlights](index=8&type=section&id=Financial%20Statements%20and%20Highlights) [Condensed Consolidated Statements of Financial Condition](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Financial%20Condition) This section provides the unaudited condensed consolidated balance sheets as of June 30, 2025, and for the four preceding quarters. It details assets, liabilities, and stockholders' equity, showing trends in key accounts like cash, investment securities, loans, deposits, and borrowings Condensed Balance Sheet (in Thousands) | | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Total assets | $1,245,613 | $1,272,200 | | **Liabilities and Stockholders' Equity** | | | | Total deposits | $888,772 | $888,348 | | Borrowings | $213,073 | $238,500 | | Total liabilities | $1,117,068 | $1,142,259 | | Total stockholders' equity | $128,545 | $129,941 | [Condensed Consolidated Statements of Operations](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section presents the unaudited condensed consolidated income statements. It includes a comparison for the quarter and fiscal year ended June 30, 2025, versus the same periods in 2024, as well as a sequential quarter comparison. It breaks down revenues and expenses to arrive at net income and earnings per share Condensed Income Statement - Quarter Ended (in Thousands) | | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Net interest income | $8,882 | $8,451 | | Total non-interest income | $880 | $1,467 | | Total non-interest expense | $7,620 | $7,172 | | Net income | $1,626 | $1,953 | Condensed Income Statement - Fiscal Year Ended (in Thousands) | | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Net interest income | $35,469 | $34,923 | | Total non-interest income | $3,531 | $3,941 | | Total non-interest expense | $30,793 | $28,540 | | Net income | $6,255 | $7,351 | [Financial Highlights](index=12&type=section&id=Financial%20Highlights) This section provides a detailed breakdown of key financial ratios, per-share data, loan originations, asset quality metrics, regulatory capital ratios, and the composition of the investment securities, loan, deposit, and borrowing portfolios. Data is presented for the current quarter and fiscal year, with comparisons to prior periods Selected Financial Ratios (Q4 2025 vs Q4 2024) | Ratio | Q4 2025 | Q4 2024 | | :--- | :--- | :--- | | Return on average assets | 0.53% | 0.62% | | Return on average stockholders' equity | 5.01% | 5.96% | | Net interest margin | 2.94% | 2.74% | | Efficiency ratio | 78.06% | 72.31% | Total Loans Originated for Investment (in Thousands) | | Q4 2025 | Q4 2024 | | :--- | :--- | :--- | | Single-family | $18,303 | $10,862 | | Multi-family | $9,343 | $4,526 | | Total | $29,388 | $18,578 | Regulatory Capital Ratios (Bank) | Ratio | As of 06/30/2025 | As of 06/30/2024 | | :--- | :--- | :--- | | Tier 1 leverage ratio | 10.11% | 10.02% | | Common equity tier 1 capital ratio | 19.50% | 19.29% | | Total risk-based capital ratio | 20.51% | 20.38% | [Asset Quality Details](index=17&type=section&id=Asset%20Quality%20Details) This table provides a detailed breakdown of non-performing assets as of June 30, 2025, and the four preceding quarters. It specifies non-accrual loans by category (single-family, multi-family) and confirms there were no accruing loans past due 90 days or more, and no real estate owned Non-Performing Assets Breakdown (in Thousands) | Category | 06/30/25 | 03/31/25 | 12/31/24 | 09/30/24 | 06/30/24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Non-accrual Single-family loans | $948 | $925 | $2,530 | $2,106 | $2,596 | | Non-accrual Multi-family loans | $466 | $470 | $0 | $0 | $0 | | **Total non-performing assets** | **$1,414** | **$1,395** | **$2,530** | **$2,106** | **$2,596** |

Provident Financial (PROV) came out with quarterly earnings of $0.24 per share, missing the Zacks Consensus Estimate of $0.29 per share. This compares to earnings of $0.28 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -17.24%. A quarter ago, it was expected that this holding company for Provident Savings Bank would post earnings of $0.24 per share when it actually produced earnings of $0.28, delivering a surprise of +16.67%. ...

Core Points - The company reported a net income of $1.63 million for the quarter ended June 30, 2025, which is a decrease of 12% from the previous quarter and 17% from the same quarter last year [1][5][6] - The net interest margin for the quarter was 2.94%, down eight basis points from the previous quarter but up 20 basis points from the same quarter last year [1][7] - Total loans held for investment were $1.05 billion, down 1% from the previous year, while total deposits remained virtually unchanged at $888.8 million [1][13] - The non-performing assets to total assets ratio improved to 0.11% from 0.20% year-over-year, indicating better asset quality [1][18] Financial Performance - Net income for the fiscal year ended June 30, 2025, decreased by $1.09 million, or 15%, to $6.26 million compared to $7.35 million in the previous year [6] - Diluted earnings per share for the fiscal year were $0.93, down 12% from $1.06 in the previous year [6] - Non-interest income decreased by $587,000, or 40%, to $880,000 in the fourth quarter, primarily due to the absence of a prior year's unrealized gain [21] - Non-interest expense increased by $448,000, or 6%, to $7.62 million, driven by higher salaries and employee benefits [22][23] Asset Quality and Credit Performance - The allowance for credit losses on loans held for investment was $6.4 million, or 0.62% of gross loans, down from $7.1 million, or 0.67%, the previous year [20] - Non-performing assets decreased by $1.2 million, or 46%, to $1.4 million, with no loans 90 days or more past due [18] - The company recorded a recovery of credit losses totaling $164,000 in the fourth quarter, compared to a recovery of $12,000 in the same quarter last year [17] Operational Highlights - The company has seen a stabilization in deposit balances and a decline in borrowings for three consecutive quarters [3] - The average yield on interest-earning assets increased to 4.67%, while average funding costs decreased to 1.91% [7] - The efficiency ratio for the fourth quarter was 78.06%, reflecting higher operating costs relative to revenue generation [24] Shareholder Returns - The company repurchased 76,104 shares at an average cost of $15.00 per share during the quarter, with a total of 217,028 shares remaining available for future purchase [26]

Core Viewpoint - BankFinancial (BFIN) is anticipated to report a year-over-year increase in earnings despite a decline in revenues for the quarter ended June 2025, with the consensus outlook indicating a potential impact on the stock price based on actual results compared to estimates [1][2]. Earnings Expectations - The consensus estimate for BankFinancial's quarterly earnings is $0.24 per share, reflecting a year-over-year increase of +41.2%, while revenues are expected to be $13.1 million, down 5.4% from the previous year [3]. - The earnings report could lead to a stock price increase if the results exceed expectations, whereas missing estimates may result in a decline [2]. Estimate Revisions - The consensus EPS estimate has remained unchanged over the last 30 days, indicating stability in analysts' assessments [4]. - BankFinancial's Most Accurate Estimate is higher than the Zacks Consensus Estimate, resulting in an Earnings ESP of +37.50%, suggesting recent bullish sentiment among analysts [12]. Earnings Surprise History - In the last reported quarter, BankFinancial exceeded the expected earnings of $0.12 per share by delivering $0.17, resulting in a surprise of +41.67% [13]. - Over the past four quarters, the company has only beaten consensus EPS estimates once [14]. Industry Context - In the Zacks Financial - Savings and Loan industry, Provident Financial (PROV) is expected to post earnings of $0.29 per share for the same quarter, indicating a year-over-year change of +3.6%, with revenues projected at $10.4 million, up 4.8% [18][19]. - Provident Financial's consensus EPS estimate has been revised down by 9.1% over the last 30 days, resulting in an Earnings ESP of -8.77%, making it challenging to predict an earnings beat [19][20].

RIVERSIDE, Calif., May 12, 2025 (GLOBE NEWSWIRE) -- Provident Financial Holdings, Inc. (“Company” or “Provident”), NASDAQ GS: PROV, the holding company for Provident Savings Bank, F.S.B. (“Bank” or “Provident”), today announced that Peter C. Fan has been appointed Senior Vice President, Chief Financial Officer, and Corporate Secretary of the Company and the Bank, effective May 12, 2025. Mr. Fan most recently served as Senior Vice President – Director of Finance and Treasury at Royal Business Bank since Febr ...

PART I - FINANCIAL INFORMATION [Financial Statements](index=3&type=section&id=ITEM%201%20-%20Financial%20Statements) The company presents its unaudited interim condensed consolidated financial statements and accompanying notes [Condensed Consolidated Statements of Financial Condition](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Financial%20Condition) Total assets slightly decreased to $1.26 billion, driven by lower investment securities and borrowings Condensed Consolidated Statements of Financial Condition (in thousands) | | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$1,260,180** | **$1,272,200** | | Cash and cash equivalents | $50,915 | $51,376 | | Investment securities | $115,298 | $131,900 | | Loans held for investment, net | $1,058,980 | $1,052,979 | | **Total Liabilities** | **$1,131,305** | **$1,142,259** | | Total deposits | $901,319 | $888,348 | | Borrowings | $215,580 | $238,500 | | **Total Stockholders' Equity** | **$128,875** | **$129,941** | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Quarterly net income rose to $1.86 million, while nine-month net income fell to $4.63 million Key Operating Results (in thousands, except per share data) | Metric | Q3 2025 | Q3 2024 | Nine Months 2025 | Nine Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $9,212 | $8,559 | $26,587 | $26,472 | | (Recovery of) Provision for Credit Losses | ($391) | $124 | ($502) | ($51) | | Non-interest Income | $907 | $848 | $2,651 | $2,474 | | Non-interest Expense | $7,856 | $7,168 | $23,173 | $21,368 | | **Net Income** | **$1,857** | **$1,495** | **$4,629** | **$5,398** | | **Diluted EPS** | **$0.28** | **$0.22** | **$0.68** | **$0.77** | [Condensed Consolidated Statements of Comprehensive Income](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) Total comprehensive income was $1.86 million for the quarter and $4.65 million for the nine-month period Comprehensive Income (in thousands) | | Quarter Ended March 31, | Nine Months Ended March 31, | | :--- | :--- | :--- | | | **2025** | **2024** | **2025** | **2024** | | Net Income | $1,857 | $1,495 | $4,629 | $5,398 | | Other comprehensive income (loss) | $1 | ($1) | $19 | $30 | | **Total Comprehensive Income** | **$1,858** | **$1,494** | **$4,648** | **$5,428** | [Condensed Consolidated Statements of Stockholders' Equity](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) Stockholders' equity decreased to $128.9 million due to dividends and stock buybacks outpacing net income - For the nine months ended March 31, 2025, stockholders' equity was impacted by **$4.6 million in net income**, offset by **$2.8 million in cash dividends** and **$3.3 million in treasury stock purchases**[18](index=18&type=chunk) - Cash dividends of **$0.42 per share** were paid in the nine months ended March 31, 2025, consistent with the same period in the prior year[19](index=19&type=chunk)[20](index=20&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=12&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used for financing outpaced cash from operations and investing, reducing cash by $461,000 Net Cash Flow Summary for Nine Months Ended March 31 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $6,205 | $6,441 | | Net cash provided by investing activities | $9,632 | $26,788 | | Net cash used for financing activities | ($16,298) | ($47,347) | | **Net decrease in cash and cash equivalents** | **($461)** | **($14,118)** | | Cash and cash equivalents at end of period | $50,915 | $51,731 | [Notes to Unaudited Interim Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Unaudited%20Interim%20Condensed%20Consolidated%20Financial%20Statements) The notes detail accounting policies, credit loss allowances, and fair value measurements for key accounts - The company is currently evaluating the impact of several new Accounting Standard Updates (ASUs), including ASU 2024-03, ASU 2023-09, and ASU 2023-07[26](index=26&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk) - At March 31, 2025, investment securities had **unrealized holding losses of $11.7 million**, primarily due to changes in interest rates, not credit quality[37](index=37&type=chunk)[39](index=39&type=chunk) - The Allowance for Credit Losses (ACL) on loans was **$6.6 million, or 0.62% of gross loans**, at March 31, 2025, down from $7.1 million at June 30, 2024[75](index=75&type=chunk)[82](index=82&type=chunk) - **Non-performing loans decreased to $1.4 million** (0.13% of LHFI) at March 31, 2025, from $2.6 million (0.25% of LHFI) at June 30, 2024[262](index=262&type=chunk)[264](index=264&type=chunk) - On January 23, 2025, the Board authorized a **new stock repurchase plan for up to 334,773 shares**, with 293,132 shares remaining available for purchase[154](index=154&type=chunk)[155](index=155&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=59&type=section&id=ITEM%202%20-%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management analyzes financial results, highlighting improved quarterly income but lower nine-month earnings [Executive Summary and Operating Strategy](index=65&type=section&id=Executive%20Summary%20and%20Operating%20Strategy) The company focuses on community banking in Southern California with a strategy of moderate asset growth - The Corporation's strategy focuses on **moderate asset growth**, with an emphasis on expanding its lending portfolios while improving the deposit base[173](index=173&type=chunk) - The company identifies elevated risk in commercial real estate, with **office space loans totaling $39.9 million**, or 3.8% of the total loan portfolio[176](index=176&type=chunk) [Comparison of Financial Condition at March 31, 2025 and June 30, 2024](index=67&type=section&id=Comparison%20of%20Financial%20Condition%20at%20March%2031,%202025%20and%20June%2030,%202024) Total assets decreased 1% to $1.26 billion due to a decline in investment securities and borrowings - **Total assets decreased 1% to $1.26 billion**, primarily from a 13% decrease in investment securities, offset by a modest increase in loans[181](index=181&type=chunk)[183](index=183&type=chunk) - **Total deposits increased by $13.0 million**, driven by $50.1 million in new government deposits, which masked a decline in other deposit categories[189](index=189&type=chunk) - **Total borrowings decreased by 10%** to $215.6 million due to scheduled maturities[192](index=192&type=chunk) - **Stockholders' equity declined by $1.0 million**, as dividends and stock repurchases outpaced net income for the nine-month period[193](index=193&type=chunk) [Comparison of Operating Results for the Quarters and Nine Months ended March 31, 2025 and 2024](index=71&type=section&id=Comparison%20of%20Operating%20Results%20for%20the%20Quarters%20and%20Nine%20Months%20ended%20March%2031,%202025%20and%202024) Quarterly net income rose 24% year-over-year, while nine-month net income fell 14% on higher expenses Key Performance Metrics | Metric | Q3 2025 | Q3 2024 | Nine Months 2025 | Nine Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Income (in millions) | $1.9 | $1.5 | $4.6 | $5.4 | | Diluted EPS | $0.28 | $0.22 | $0.68 | $0.77 | | Return on Average Assets | 0.59% | 0.47% | 0.50% | 0.56% | | Return on Average Equity | 5.71% | 4.57% | 4.72% | 5.51% | | Efficiency Ratio | 77.64% | 76.20% | 79.26% | 73.82% | [Asset Quality](index=88&type=section&id=Asset%20Quality) Asset quality improved as non-performing assets decreased to $1.4 million, or 0.11% of total assets Non-Performing Assets (in thousands) | | At March 31, 2025 | At June 30, 2024 | | :--- | :--- | :--- | | Total non-performing loans | $1,395 | $2,596 | | Real estate owned, net | $— | $— | | **Total non-performing assets** | **$1,395** | **$2,596** | | Non-performing assets as a % of total assets | 0.11% | 0.20% | - **Total classified assets increased to $6.8 million** at March 31, 2025, from $5.8 million at June 30, 2024[265](index=265&type=chunk) - The January 2025 wildfires in Los Angeles did not have a material impact, although the bank identified **$23.7 million in potentially affected zones**[263](index=263&type=chunk) [Loan Volume Activities](index=91&type=section&id=Loan%20Volume%20Activities) Loan originations for investment increased 64% to $93.3 million in the nine-month period Loan Volume Activity (in thousands) | Activity | Nine Months Ended March 31, 2025 | Nine Months Ended March 31, 2024 | | :--- | :--- | :--- | | Total loans originated for investment | $93,277 | $56,941 | | Loan principal payments | ($91,351) | ($69,276) | | **Net increase (decrease) in LHFI** | **$6,001** | **($11,868)** | [Liquidity and Capital Resources](index=91&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a strong liquidity position and exceeds all regulatory capital requirements - **Total remaining available borrowing capacity** across all sources was approximately **$470.8 million** at March 31, 2025[272](index=272&type=chunk)[273](index=273&type=chunk) - The Corporation **repurchased 209,066 shares** at a weighted average cost of $15.06 per share during the first nine months of fiscal 2025[193](index=193&type=chunk)[275](index=275&type=chunk) Bank Regulatory Capital Ratios (as of March 31, 2025) | Ratio | Actual | Minimum to Be Well Capitalized | | :--- | :--- | :--- | | Tier 1 leverage capital | 9.85% | 5.00% | | CET1 capital | 19.01% | 6.50% | | Tier 1 capital | 19.01% | 8.00% | | Total capital | 20.03% | 10.00% | [Quantitative and Qualitative Disclosures about Market Risk](index=97&type=section&id=ITEM%203%20-%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company manages interest rate risk, with analysis showing a liability-sensitive position short-term - The interest rate gap analysis as of March 31, 2025, shows a **cumulative negative gap of $198.7 million** for instruments repricing within 12 months[298](index=298&type=chunk)[300](index=300&type=chunk) Net Portfolio Value (NPV) Sensitivity as of March 31, 2025 | Rate Change (bp) | NPV Change (in thousands) | Sensitivity Measure (bp) | | :--- | :--- | :--- | | +300 | ($16,485) | -106 | | +200 | ($4,949) | -28 | | +100 | $1,033 | 10 | | **Base Case** | **$149,877** | **—** | | -100 | ($1,761) | -15 | | -200 | ($14,247) | -105 | | -300 | ($15,993) | -120 | Net Interest Income (NII) Sensitivity (Next 12 Months) | Rate Change (bp) | Change in NII (as of Mar 31, 2025) | Change in NII (as of Jun 30, 2024) | | :--- | :--- | :--- | | +200 | 2.30% | -3.45% | | +100 | 1.98% | -0.51% | | -100 | -2.78% | -0.67% | | -200 | -5.68% | -1.15% | [Controls and Procedures](index=104&type=section&id=ITEM%204%20-%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective with no material changes - The CEO and Interim CFO concluded that the Corporation's **disclosure controls and procedures were effective** as of March 31, 2025[309](index=309&type=chunk) - **No material changes** were made to the internal control over financial reporting during the quarter ended March 31, 2025[310](index=310&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=104&type=section&id=ITEM%201%20-%20Legal%20Proceedings) The company settled two PAGA lawsuits for $231,600, which was fully expensed in the third quarter - The company settled two PAGA lawsuits from former employees for an aggregate amount of **$231,600**[312](index=312&type=chunk)[315](index=315&type=chunk)[316](index=316&type=chunk) - The **full settlement expense was recognized in the third quarter** of fiscal 2025, and the settlement is pending court approval[316](index=316&type=chunk) [Risk Factors](index=106&type=section&id=ITEM%201A%20-%20Risk%20Factors) No material changes to risk factors were reported since the last annual report on Form 10-K - **No material changes** in risk factors were reported since the last Annual Report on Form 10-K[318](index=318&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=106&type=section&id=ITEM%202%20-%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 51,869 shares in Q3 2025 under a new stock repurchase plan - A **new stock repurchase plan for 334,773 shares** was announced on January 23, 2025, replacing a previous plan[320](index=320&type=chunk) Equity Security Purchases in Q3 2025 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | Jan 2025 | 14,980 | $15.66 | | Feb 2025 | 17,006 | $15.93 | | Mar 2025 | 19,883 | $14.49 | | **Total** | **51,869** | **$15.30** | [Defaults Upon Senior Securities](index=106&type=section&id=ITEM%203%20-%20Defaults%20Upon%20Senior%20Securities) This section is not applicable to the company - Not applicable[321](index=321&type=chunk) [Mine Safety Disclosures](index=106&type=section&id=ITEM%204%20-%20Mine%20Safety%20Disclosures) This section is not applicable to the company - Not applicable[322](index=322&type=chunk) [Other Information](index=108&type=section&id=ITEM%205%20-%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 trading arrangements during the quarter - **No director or officer adopted or terminated a Rule 10b5-1 trading plan** during the quarter[325](index=325&type=chunk) [Exhibits](index=108&type=section&id=ITEM%206%20-%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including certifications and XBRL data - Exhibits filed include corporate governance documents, executive employment agreements, and Sarbanes-Oxley certifications[325](index=325&type=chunk)

Financial Data and Key Metrics Changes - The company originated $27.9 million in loans held for investment, a 23% decrease from $36.4 million in the prior sequential quarter [5] - Loan principal payments and payoffs were $23 million, down 33% from $34.3 million in the previous quarter [5] - Non-performing assets decreased to $1.4 million from $2.5 million, indicating improved asset quality [6] - The allowance for credit losses to gross loans held for investment decreased from 66 basis points to 62 basis points [9] - Net interest margin increased by 11 basis points to 3.02% compared to 2.91% in the previous quarter [9] Business Line Data and Key Metrics Changes - Loans held for investment increased by approximately $5.4 million compared to the previous quarter, driven by an increase in single-family loans [6] - There were declines in multifamily, commercial real estate, construction, and commercial business loans [6] - The company has seen more consumer demand for single-family adjustable-rate mortgage products due to higher fixed-rate mortgage interest rates [6] Market Data and Key Metrics Changes - Economic uncertainty has increased due to current fiscal policy, impacting real estate investor activity [6] - The company noted a shift in consumer demand towards adjustable-rate mortgage products as fixed rates rise [6] Company Strategy and Development Direction - The company aims for disciplined growth of the loan portfolio, recognizing the shift to looser monetary policy [13] - The strategy includes maintaining cash dividends and utilizing stock buyback programs as a capital management tool [14] - The company is focused on improving operating efficiencies to lower operating expenses [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for net interest margin expansion in the upcoming quarter, albeit at a slower pace than the current quarter [11] - The company is monitoring commercial real estate loans, particularly those secured by office buildings, and remains confident in their performance [7] - Management acknowledged the challenges posed by higher mortgage rates and economic uncertainty but indicated a commitment to growth [6][13] Other Important Information - The company repurchased approximately 52,000 shares of common stock in the March quarter [14] - For the fiscal year to date, the company has distributed approximately $2.8 million in cash dividends and repurchased approximately $3.1 million worth of common stock [14] Q&A Session Summary Question: Inquiry about CD growth in the quarter - Management indicated that the growth was due to a remix of the liability profile and the opening of a government deposit desk, allowing for liquidity to pay down Federal Home Loan Bank advances [17] Question: Were new CDs at a better rate than wholesale market? - Management noted that the rates were similar to wholesale, and the strategy was adjusted due to lower short-term rates [18] Question: Thoughts on prepayment activity over the next twelve months? - Management stated that prepayment activity is difficult to predict, with lower prepayments observed in the March quarter due to mortgage rate volatility [28] Question: Capital allocation and potential buyback adjustments? - Management emphasized the importance of maintaining capital during uncertainty but indicated that if stock prices decline, they would consider repurchasing more shares [32][34] Question: Changes in loan competition behavior? - Management noted no significant changes in competition but acknowledged aggressive pricing in the multifamily loan market [35][36]

Financial Data and Key Metrics Changes - The company originated $27.9 million in loans held for investment, a 23% decrease from $36.4 million in the prior sequential quarter [6] - Loan principal payments and payoffs were $23 million, down 33% from $34.3 million in the previous quarter [6] - Non-performing assets decreased to $1.4 million from $2.5 million in the prior quarter [8] - The allowance for credit losses to gross loans held for investment decreased from 66 basis points to 62 basis points [10] - Net interest margin increased by 11 basis points to 3.02% compared to 2.91% in the previous quarter [10] Business Line Data and Key Metrics Changes - Loans held for investment increased by approximately $5.4 million compared to the previous quarter, with an increase in single-family loans [7] - There were declines in multifamily, commercial real estate, construction, and commercial business loans [7] - The company has seen more consumer demand for single-family adjustable-rate mortgage products due to higher fixed-rate mortgage interest rates [7] Market Data and Key Metrics Changes - Economic uncertainty has increased due to current fiscal policy, impacting real estate investor activity [7] - The company noted that the current credit quality remains strong, with only $199,000 of early-stage delinquencies reported [9] Company Strategy and Development Direction - The company aims for disciplined growth of the loan portfolio, recognizing a shift to looser monetary policy [14] - The strategy includes maintaining cash dividends and utilizing stock buyback programs as a responsible capital management tool [16] - The company is focused on improving operating efficiencies to lower operating expenses [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for net interest margin expansion in the upcoming quarter, albeit at a slower pace than the current quarter [12] - The company is monitoring the impact of mortgage rate volatility on prepayment activity, which has historically affected their loan portfolio [31] - Management indicated that they are prepared to adjust their lending strategy based on market conditions and competitive pricing [43] Other Important Information - The company repurchased approximately 52,000 shares of common stock in the March quarter [16] - For the fiscal year to date, the company has distributed approximately $2.8 million in cash dividends and repurchased approximately $3.1 million worth of common stock [16] Q&A Session Summary Question: Inquiry about CD growth in the quarter - Management explained that they remixed the liability profile and opened their government deposit desk, accumulating government deposits which provided liquidity to pay down Federal Home Loan Bank advances [19] Question: Were the new CDs at a better rate than wholesale market? - Management noted that the rates were similar to wholesale, and the strategy change was due to a decrease in short-term rates [20] Question: Thoughts on prepayment activity over the next twelve months? - Management indicated that prepayment activity is difficult to predict, but lower mortgage rates tend to increase activity [31] Question: Capital allocation and potential buyback adjustments? - Management stated that while having more capital is preferable during uncertainty, they have already set their capital plans for the fiscal year [37] Question: Changes in loan competition behavior? - Management noted that they have not seen significant changes in competition, although some aggressive pricing in multifamily loans has been observed [39]