Group 1 - The bank has not experienced growth for a long time and is primarily exposed to residential mortgages, with a roughly equal split between single-family and multi-family properties in Southern California [1] - The investment strategy focuses on long-only investments, evaluating companies from an operational and buy-and-hold perspective, rather than market-driven dynamics [1] - The articles emphasize the importance of understanding the long-term earnings potential of companies and the competitive dynamics within their industries [1] Group 2 - The investment philosophy suggests that only a small fraction of companies should be considered a buy at any given time, with most recommendations being holds [1] - Hold articles are intended to provide valuable information for future investors and introduce a healthy skepticism in a generally bullish market [1]

[PART I](index=4&type=section&id=PART%20I) [Item 1. Business](index=4&type=section&id=Item%201.%20Business) The Corporation operates as a holding company for Provident Savings Bank, F.S.B., providing community banking, investment, and trustee services in Southern California, with consolidated assets of $1.25 billion at June 30, 2025 - The Corporation's core business is community banking via Provident Savings Bank, F.S.B., serving Southern California's Inland Empire region[14](index=14&type=chunk) Consolidated Financial Highlights (June 30, 2025 vs. 2024) | Metric | June 30, 2025 | June 30, 2024 | | :--------------------- | :------------ | :------------ | | Total Assets | $1.25 billion | $1.27 billion | | Total Deposits | $888.8 million | $888.3 million | | Stockholders' Equity | $128.5 million | $129.9 million | [General](index=4&type=section&id=General) Provident Financial Holdings, Inc. is the holding company for Provident Savings Bank, F.S.B., providing community banking, investment, and trustee services, with $1.25 billion in assets at June 30, 2025 - The Corporation primarily operates through its wholly-owned subsidiary, Provident Savings Bank, F.S.B., regulated by the OCC and FDIC[12](index=12&type=chunk)[13](index=13&type=chunk) - The Bank's activities encompass community banking, investment services, and real estate trustee services, generating revenue from loan interest, investments, and banking fees[14](index=14&type=chunk)[15](index=15&type=chunk) Consolidated Financial Position (June 30, 2025) | Metric | Amount (Millions) | | :------------------- | :---------------- | | Total Assets | $1,250 | | Total Deposits | $888.8 | | Stockholders' Equity | $128.5 | [Subsequent Event](index=4&type=section&id=Subsequent%20Event) The Board declared a cash dividend of $0.14 per share on July 24, 2025, payable September 4, 2025 - A cash dividend of **$0.14 per share** was declared on July 24, 2025, scheduled for payment on September 4, 2025[17](index=17&type=chunk) [Market Area](index=6&type=section&id=Market%20Area) The Bank operates 13 offices in Southern California's Inland Empire, facing a 5.9% unemployment rate and modest economic growth, with slight declines in the housing market - The Bank's primary market is Southern California's Inland Empire, operating **13 full-service banking offices** in Riverside and San Bernardino counties[18](index=18&type=chunk) Unemployment Rates (June 2025 vs. June 2024) | Region | June 2025 | June 2024 | | :------------- | :-------- | :-------- | | Inland Empire | 5.9% | 5.3% | | California | 5.4% | 5.2% | | Nationwide | 4.1% | 4.1% | - Inland Empire economic growth is projected to modestly increase in 2025, outperforming California but not the national economy, supported by consumer credit and logistics[20](index=20&type=chunk) California Housing Market Data (June 2025 vs. June 2024) | Metric | June 2025 | June 2024 | YoY Change | | :-------------------------------- | :---------- | :---------- | :--------- | | Seasonally Adjusted Annualized Sales | 264,260 | 264,960 | -0.3% | | Median Home Price | $899,560 | $900,720 | -0.1% | [Competition](index=6&type=section&id=Competition) The Bank faces intense competition from larger financial institutions and non-banking entities with superior resources, potentially limiting its growth and profitability - The Bank operates in a highly competitive market, facing larger national and regional commercial banks, credit unions, and non-banking entities[22](index=22&type=chunk)[23](index=23&type=chunk) - Larger competitors possess superior financial and marketing resources, potentially constraining the Bank's future growth and profitability[24](index=24&type=chunk) [Reportable Segments](index=8&type=section&id=Reportable%20Segments) The Corporation evaluates financial performance on a company-wide basis, thus operating as a single reportable segment - The Corporation operates as a **single operating and reportable segment**, with financial performance assessed on a corporation-wide basis[25](index=25&type=chunk) [Internet Website](index=8&type=section&id=Internet%20Website) The Corporation provides SEC filings (10-K, 10-Q, 8-K) free of charge on its website, though this information is not incorporated into the Form 10-K - The Corporation provides SEC filings (10-K, 10-Q, 8-K) free of charge on its website (www.myprovident.com) and through the SEC's website (www.sec.gov)[26](index=26&type=chunk) [Lending Activities](index=8&type=section&id=Lending%20Activities) The Bank primarily originates single-family, multi-family, and commercial real estate loans, with net loans of $1.05 billion (84% of assets) at June 30, 2025, and a 62% increase in originations for fiscal 2025 - The Bank's lending focuses on single-family, multi-family, and commercial real estate loans, with net loans held for investment at **$1.05 billion** (**84% of total assets**) as of June 30, 2025[27](index=27&type=chunk) Composition of Loans Held for Investment (June 30, 2025 vs. 2024) | Loan Type | June 30, 2025 (Millions) | June 30, 2025 (Percent) | June 30, 2024 (Millions) | June 30, 2024 (Percent) | | :-------------------- | :----------------------- | :---------------------- | :----------------------- | :---------------------- | | Single-family | $544.4 | 52.23% | $518.1 | 49.30% | | Multi-family | $423.4 | 40.62% | $445.2 | 42.36% | | Commercial real estate| $72.8 | 6.98% | $83.3 | 7.93% | | Construction | $0.4 | 0.04% | $2.7 | 0.26% | | Other | $0.1 | 0.01% | $0.1 | 0.01% | | Commercial business | $1.3 | 0.12% | $1.4 | 0.13% | | Consumer | $0.1 | —% | $0.1 | 0.01% | | **Total Gross Loans** | **$1,042.4** | **100.00%** | **$1,050.8** | **100.00%** | Loan Originations for Investment (Fiscal Year Ended June 30) | Loan Type | 2025 (Millions) | 2024 (Millions) | | :-------------------- | :-------------- | :-------------- | | Single-family | $92.5 | $40.9 | | Multi-family | $25.1 | $22.1 | | Commercial real estate| $3.8 | $9.8 | | Construction | $0.7 | $1.5 | | Commercial business | $0.6 | $1.3 | | **Total** | **$122.7** | **$75.5** | [Loan Servicing](index=23&type=section&id=Loan%20Servicing) The Bank services $34.4 million in loans for other investors, earning fees, with servicing assets amortized and an impairment reserve of $151,000 at June 30, 2025 - The Bank services loans for other investors, earning fees for payment collection and loan management[75](index=75&type=chunk) Loan Servicing Portfolio and Impairment Reserve (June 30) | Metric | June 30, 2025 (Millions) | June 30, 2024 (Millions) | | :-------------------------------- | :----------------------- | :----------------------- | | Loans serviced for others | $34.4 | $34.6 | | Servicing assets carrying value | $0.3 | $0.3 | | Servicing assets fair value | $0.1 | $0.1 | | Required impairment reserve | $0.2 | $0.2 | [Asset Quality](index=23&type=section&id=Asset%20Quality) Asset quality improved in fiscal 2025, with non-performing assets decreasing to $1.4 million (0.11% of total assets) and ACL on loans decreasing by 9% to $6.4 million Non-Performing Assets (June 30) | Metric | June 30, 2025 (Millions) | June 30, 2024 (Millions) | | :----------------------------------------- | :----------------------- | :----------------------- | | Total non-performing assets, net | $1.4 | $2.6 | | Non-performing loans as % of net loans | 0.14% | 0.25% | | Non-performing assets as % of total assets | 0.11% | 0.20% | Allowance for Credit Losses (ACL) on Loans (June 30) | Metric | June 30, 2025 (Millions) | June 30, 2024 (Millions) | | :----------------------------------------- | :----------------------- | :----------------------- | | ACL on loans | $6.4 | $7.1 | | ACL on loans as % of gross loans | 0.62% | 0.67% | - The Bank reported **no charge-offs or recoveries** across all loan categories in fiscal years 2025 and 2024[38](index=38&type=chunk)[54](index=54&type=chunk)[64](index=64&type=chunk)[70](index=70&type=chunk)[72](index=72&type=chunk)[90](index=90&type=chunk) [Investment Securities Activities](index=30&type=section&id=Investment%20Securities%20Activities) The Bank's investment portfolio decreased by 16% to $111.0 million at June 30, 2025, with $10.4 million in unrealized losses primarily due to interest rate changes, not credit risk - The Bank's investment policy prioritizes liquidity, complements lending, and seeks favorable returns while managing interest rate and credit risk[93](index=93&type=chunk) Investment Securities Portfolio (June 30) | Metric | June 30, 2025 (Millions) | June 30, 2024 (Millions) | YoY Change | | :-------------------------------- | :----------------------- | :----------------------- | :--------- | | Total Investment Securities | $111.0 | $131.9 | -16% | | Unrealized Holding Losses | $10.4 | $15.8 | -34.2% | - Unrealized losses stem from interest rate changes, not credit quality, as most securities are U.S. government-guaranteed GSE obligations, intended to be held to maturity or cost recovery[98](index=98&type=chunk)[101](index=101&type=chunk)[506](index=506&type=chunk)[509](index=509&type=chunk) [Deposit Activities and Other Sources of Funds](index=33&type=section&id=Deposit%20Activities%20and%20Other%20Sources%20of%20Funds) Deposits and loan repayments are primary funding sources, supplemented by FHLB, FRB, and correspondent bank borrowings, with total deposits at $888.8 million and $474.8 million in available borrowing capacity at June 30, 2025 - Deposits and loan repayments serve as primary funding sources, supplemented by FHLB, FRB, and correspondent bank borrowings[102](index=102&type=chunk) Deposit Composition (June 30, 2025 vs. 2024) | Deposit Type | June 30, 2025 (Millions) | June 30, 2024 (Millions) | YoY Change (Millions) | | :------------------ | :----------------------- | :----------------------- | :-------------------- | | Transaction accounts| $576.5 | $614.5 | $(38.1) | | Time deposits | $312.3 | $273.9 | $38.4 | | **Total Deposits** | **$888.8** | **$888.3** | **$0.4** | Borrowings and Available Capacity (June 30, 2025) | Source | Outstanding (Millions) | Available Capacity (Millions) | | :-------------------------- | :--------------------- | :---------------------------- | | FHLB – San Francisco | $213.0 | $282.3 | | FRB of San Francisco | $0 | $142.5 | | Correspondent Bank | $0 | $50.0 | | **Total Available Capacity**| | **$474.8** | [Subsidiary Activities](index=38&type=section&id=Subsidiary%20Activities) The Bank has three wholly-owned subsidiaries, with Provident Financial Corp active in trustee services and real estate, and a total investment of $14,000 at June 30, 2025 - The Bank's wholly-owned subsidiaries include Provident Financial Corp (PFC), Profed Mortgage, Inc., and First Service Corporation[121](index=121&type=chunk) - PFC acts as a trustee for real estate transactions and holds real estate for investment, while other subsidiaries are inactive[121](index=121&type=chunk) Bank's Investment in Subsidiaries (June 30) | Metric | June 30, 2025 (Thousands) | June 30, 2024 (Thousands) | | :-------------------------- | :------------------------ | :------------------------ | | Total Investment in Subsidiaries | $14 | $8 | [Regulation](index=40&type=section&id=Regulation) The Corporation and Bank are extensively regulated by federal agencies, covering operations, capital, and consumer protection, with the Bank 'well capitalized' and meeting QTL requirements at June 30, 2025 - The Bank is extensively regulated by the OCC, FDIC, and FRB, covering operations, lending limits, deposit insurance, capital requirements, and consumer protection[124](index=124&type=chunk) Key Regulatory Compliance Metrics (June 30) | Metric | June 30, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------ | | Qualified Thrift Lender (QTL) Test | 93.0% | 92.3% | | OCC Annual Assessments (Thousands) | $167 | $179 | | FDIC Annual Assessments (Thousands)| $573 | $601 | - The Bank was categorized as **'well capitalized'** at June 30, 2025, exceeding all minimum regulatory capital requirements[150](index=150&type=chunk)[376](index=376&type=chunk) - The Corporation adopted the CECL accounting standard on July 1, 2023, resulting in a one-time **$824,000 net-of-tax charge** to retained earnings[148](index=148&type=chunk)[309](index=309&type=chunk) [Taxation](index=56&type=section&id=Taxation) The Corporation is subject to federal and state income taxation, with the Bank holding a $9.0 million pre-1988 bad debt reserve and paying $43,000 in excise tax on stock repurchases in fiscal 2025 - The Bank's bad debt deductions are based on specific charge-offs, holding a pre-1988 bad debt reserve of approximately **$9.0 million** for tax purposes[187](index=187&type=chunk) Tax-Related Financials (Fiscal Year Ended June 30) | Metric | 2025 (Thousands) | 2024 (Thousands) | | :-------------------------------- | :--------------- | :--------------- | | Excise Tax on Stock Repurchases | $43 | $26 | | Bank Cash Dividends to Provident | $9,000 | $7,000 | | Provident Cash Dividends to Shareholders | $3,800 | $3,887 | - The Corporation's net state tax rate in California was **8.6%** at June 30, 2025, and it is exempt from Delaware corporate income tax[194](index=194&type=chunk)[195](index=195&type=chunk) [Employees and Human Capital](index=58&type=section&id=Employees%20and%20Human%20Capital) As of June 30, 2025, the Bank had 163 full-time equivalent employees with an average tenure of 8.5 years, and a diverse workforce, though turnover slightly increased to 24.3% Employee Demographics and Tenure (June 30, 2025) | Metric | Value | | :-------------------- | :---- | | Full-time equivalent employees | 163 | | Female workforce | 69.8% | | Male workforce | 30.2% | | Average employee tenure | 8.5 years | Employee Turnover Rate (Fiscal Year Ended June 30) | Metric | 2025 | 2024 | | :------------- | :---- | :---- | | Turnover Rate | 24.3% | 23.3% | - The Bank offers market-competitive compensation, benefits, and development opportunities to attract and retain talent, fostering high employee loyalty[197](index=197&type=chunk)[198](index=198&type=chunk)[199](index=199&type=chunk) [Executive Officers](index=60&type=section&id=Executive%20Officers) The executive leadership team includes Donavon P. Ternes (President/CEO) and Peter C. Fan (SVP/CFO), alongside other experienced officers leading key banking divisions - Donavon P. Ternes serves as **President and Chief Executive Officer** for both the Corporation and the Bank[201](index=201&type=chunk)[203](index=203&type=chunk) - Peter C. Fan was appointed **Senior Vice President, Chief Financial Officer, and Corporate Secretary** effective May 12, 2025[201](index=201&type=chunk)[204](index=204&type=chunk) - Other key executive officers include Robert 'Scott' Ritter (SVP, Single-Family Division), David S. Weiant (SVP, Chief Lending Officer), and Gwendolyn L. Wertz (SVP, Retail Banking Division)[201](index=201&type=chunk)[205](index=205&type=chunk)[206](index=206&type=chunk)[207](index=207&type=chunk) [Item 1A. Risk Factors](index=61&type=section&id=Item%201A.%20Risk%20Factors) The Corporation faces significant risks from macroeconomic conditions, lending activities, interest rate fluctuations, extensive regulations, cybersecurity threats, and reliance on Bank dividends - Economic downturns, especially in Southern California, can adversely affect the business due to concentrated real estate loans[209](index=209&type=chunk) - Lending activities, particularly single-family (**52% of loans**) and multi-family/commercial real estate (**48% of loans**), carry significant credit risk from economic shifts or natural disasters like wildfires[216](index=216&type=chunk)[218](index=218&type=chunk)[229](index=229&type=chunk) - Fluctuating interest rates, monetary policy, and inflation can negatively impact net interest income, securities portfolio value, and overall profitability[215](index=215&type=chunk)[233](index=233&type=chunk)[237](index=237&type=chunk) - Extensive regulatory requirements (accounting, AML, cybersecurity, DEI/ESG) pose compliance and reputational risks, with non-compliance potentially leading to fines or sanctions[241](index=241&type=chunk)[244](index=244&type=chunk)[271](index=271&type=chunk)[273](index=273&type=chunk) - Cybersecurity threats, data breaches, fraud, and third-party vendor reliance are significant operational risks, potentially causing financial losses, reputational damage, and increased regulatory scrutiny[251](index=251&type=chunk)[252](index=252&type=chunk)[259](index=259&type=chunk) [Risks Related to Macroeconomic Conditions](index=61&type=section&id=Risks%20Related%20to%20Macroeconomic%20Conditions) The Corporation's performance is highly vulnerable to Southern California's economic conditions, with 64% of real estate loans concentrated there, and faces risks from policy changes and geopolitical tensions - Approximately **64% of real estate loans** are concentrated in Southern California, making the Corporation highly vulnerable to regional economic downturns[209](index=209&type=chunk) - Economic deterioration could lead to higher loan delinquencies, increased ACL, slower foreclosed asset sales, and decreased demand for products and services[213](index=213&type=chunk) - U.S. immigration policy changes and global geopolitical tensions could disrupt regional industries, increase costs, and impair borrowers' repayment abilities[210](index=210&type=chunk)[211](index=211&type=chunk)[215](index=215&type=chunk) [Risks Related to our Lending Activities](index=63&type=section&id=Risks%20Related%20to%20our%20Lending%20Activities) The Bank's lending activities face significant credit risk from single-family (52%) and multi-family/commercial real estate (48%) loans, with potential for insufficient ACL and increased defaults from California wildfires - Single-family residential loans (**52% of portfolio**) are highly sensitive to regional economic conditions, with non-traditional loans carrying higher default risk[216](index=216&type=chunk)[217](index=217&type=chunk)[225](index=225&type=chunk) - Multi-family and commercial real estate loans (**48% of portfolio**) involve higher principal, are less liquid, and depend on property income, increasing credit risk and potential default losses[218](index=218&type=chunk)[219](index=219&type=chunk)[221](index=221&type=chunk) - The Allowance for Credit Losses (ACL) relies on subjective estimates; inaccuracies could lead to an insufficient allowance and negatively impact net income[224](index=224&type=chunk) - California wildfires pose ongoing risks, potentially increasing loan defaults, reducing repayment capacity, and impairing collateral values, requiring increased loan loss provisions[229](index=229&type=chunk) [Risks Related to Market and Interest Rate Changes](index=67&type=section&id=Risks%20Related%20to%20Market%20and%20Interest%20Rate%20Changes) The Corporation's profitability is highly sensitive to interest rate fluctuations, which can impact net interest income, deposit costs, mortgage default risk, and the fair value of the securities portfolio - Net interest income is highly sensitive to interest rate fluctuations, influenced by economic conditions and FRB policies[233](index=233&type=chunk) - Rising interest rates can increase deposit retention costs, reduce net interest income, and potentially increase default rates on adjustable-rate mortgage (ARM) loans[235](index=235&type=chunk)[236](index=236&type=chunk) - Interest rate changes directly impact the fair value of the securities portfolio, with unrealized losses on available-for-sale securities affecting stockholders' equity[237](index=237&type=chunk)[240](index=240&type=chunk) [Risks Related to Regulatory, Legal and Compliance Matters](index=69&type=section&id=Risks%20Related%20to%20Regulatory%2C%20Legal%20and%20Compliance%20Matters) The Corporation faces extensive regulatory, legal, and compliance risks, including CECL-driven earnings volatility, anti-money laundering non-compliance, evolving climate/DEI/ESG policies, and reliance on restricted Bank dividends - The CECL model, adopted July 1, 2023, introduces increased earnings volatility due to its reliance on macroeconomic forecasts for credit loss estimation[243](index=243&type=chunk) - Non-compliance with anti-money laundering laws (USA Patriot Act, Bank Secrecy Act) can result in significant fines, sanctions, and reputational harm[244](index=244&type=chunk) - Evolving federal policies on climate change and DEI/ESG initiatives may lead to reputational harm, increased compliance costs, litigation, or limitations on federal program participation[271](index=271&type=chunk)[272](index=272&type=chunk)[273](index=273&type=chunk) - The Corporation's holding company revenue substantially depends on Bank dividends, which are subject to regulatory restrictions and the Bank's financial performance[274](index=274&type=chunk) [Risks Related to Cybersecurity, Data and Fraud](index=73&type=section&id=Risks%20Related%20to%20Cybersecurity%2C%20Data%20and%20Fraud) The Corporation faces significant cybersecurity, data breach, and fraud risks, with potential for financial losses and reputational damage, exacerbated by reliance on third-party vendors - Cybersecurity threats, including breaches, fraudulent access, and malware, pose significant risks to the Corporation's information systems and confidential data[251](index=251&type=chunk) - Data breaches involving third-party processors or payment systems can lead to liability for fraudulent transactions, fines, and reputational damage[252](index=252&type=chunk) - Reliance on external vendors for key business infrastructure components exposes the Corporation to risks of operational disruption from vendor failures or difficulties[258](index=258&type=chunk)[262](index=262&type=chunk) [Risks Related to Our Business and Industry Generally](index=77&type=section&id=Risks%20Related%20to%20Our%20Business%20and%20Industry%20Generally) The Corporation faces risks from ineffective liquidity management, reputational damage, the need for additional capital, rapid technological changes, natural disasters in California, and potential loan repurchase obligations - Ineffective liquidity management, due to funding disruptions or economic downturns, could significantly impair the Corporation's ability to finance operations and meet obligations[261](index=261&type=chunk) - Maintaining a strong reputation is vital; negative publicity or misconduct could result in customer loss, litigation, and increased regulation[263](index=263&type=chunk) - The Corporation may need to raise additional capital for growth or losses, but availability and cost are uncertain, potentially leading to dilution or adverse regulatory action[264](index=264&type=chunk)[265](index=265&type=chunk) - Rapid technological changes in financial services require substantial investment; failure to keep pace could result in a competitive disadvantage[266](index=266&type=chunk) - Geographic concentration in California exposes the Corporation to material losses from natural disasters affecting collateral values and borrower repayment capacity[267](index=267&type=chunk) [Item 1B. Unresolved Staff Comments](index=81&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The Corporation has no unresolved staff comments from the SEC - There are no unresolved staff comments[275](index=275&type=chunk) [Item 1C. Cybersecurity](index=81&type=section&id=Item%201C.%20Cybersecurity) The Corporation integrates cybersecurity risk management into its overall framework, with dedicated IT risk management, third-party experts, and Board oversight, as disclosed in this Form 10-K - Cybersecurity risk management is a fundamental part of the Corporation's overall risk framework, involving processes, assessments, and controls to identify and mitigate risks[276](index=276&type=chunk) - The information technology risk management department is led by a Chief Information Officer (CIO) and an Information Security Officer (ISO) with extensive cybersecurity expertise[278](index=278&type=chunk) - The Board of Directors, particularly the Audit Committee, oversees cybersecurity risk management, receiving regular reports to guide decisions and resource allocation[280](index=280&type=chunk) [Item 2. Properties](index=83&type=section&id=Item%202.%20Properties) At June 30, 2025, the Corporation's net book value of properties was $9.3 million, operating 13 retail banking offices (six owned, seven leased) in Southern California Properties and Equipment Net Book Value (June 30, 2025) | Metric | Amount (Millions) | | :-------------------------------- | :---------------- | | Net Book Value of Properties, etc. | $9.3 | - The Corporation operates **13 retail banking offices** in Riverside and San Bernardino counties, with six owned and seven leased[281](index=281&type=chunk) [Item 3. Legal Proceedings](index=83&type=section&id=Item%203.%20Legal%20Proceedings) The Corporation is involved in routine legal proceedings but none are expected to have a material adverse effect on its financial condition, operations, or cash flows - The Corporation is involved in routine legal proceedings, but none are expected to have a material adverse effect on its financial condition, operations, or cash flows[282](index=282&type=chunk)[283](index=283&type=chunk) [Item 4. Mine Safety Disclosures](index=85&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the Corporation - Mine Safety Disclosures are not applicable to the Corporation[285](index=285&type=chunk) [PART II](index=85&type=section&id=PART%20II) [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=85&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The Corporation's common stock trades on NASDAQ under 'PROV', with 405 shareholders of record, and a stock repurchase plan authorized for up to 334,773 shares - The Corporation's common stock trades on the NASDAQ Global Select Market under the symbol **'PROV'**[287](index=287&type=chunk) - The Board of Directors has declared quarterly cash dividends on common stock since September 30, 2002, with future payments subject to financial and regulatory factors[288](index=288&type=chunk) Stock Repurchase Activity (Q4 Fiscal 2025) | Period | Total Shares Purchased | Average Price Paid per Share | Shares Remaining Under Plan | | :----------------------------- | :--------------------- | :--------------------------- | :-------------------------- | | April 1, 2025 – April 30, 2025 | 32,672 | $14.37 | 260,460 | | May 1, 2025 – May 31, 2025 | 32,824 | $15.45 | 227,636 | | June 1, 2025 – June 30, 2025 | 10,608 | $15.59 | 217,028 | | **Total** | **76,104** | **$15.00** | **217,028** | Cumulative Total Shareholder Return (Indexed to $100 on June 30, 2020) | Date | PROV | NASDAQ Stock Index | NASDAQ Bank Index | | :--------- | :----- | :----------------- | :---------------- | | 6/30/2020 | $100.00 | $100.00 | $100.00 | | 6/30/2021 | $133.88 | $144.47 | $172.87 | | 6/30/2022 | $118.93 | $123.91 | $141.17 | | 6/30/2023 | $106.52 | $147.56 | $136.81 | | 6/30/2024 | $109.06 | $182.40 | $187.05 | | 6/30/2025 | $140.40 | $210.65 | $249.72 | [Item 6. [Reserved]](index=87&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved and contains no information [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=87&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Net income decreased by 15% to $6.3 million in fiscal 2025, driven by higher expenses and lower non-interest income, while total assets decreased by 2% to $1.25 billion Net Income and EPS (Fiscal Year Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | YoY Change (Millions) | | :-------------------- | :-------------- | :-------------- | :-------------------- | | Net Income | $6.3 | $7.4 | $(1.1) |\n| Diluted EPS | $0.93 | $1.06 | $(0.13) | Key Performance Ratios (Fiscal Year Ended June 30) | Metric | 2025 | 2024 | | :-------------------- | :---- | :---- | | Efficiency Ratio | 79% | 73% | | Return on Average Assets | 0.50% | 0.57% | | Return on Average Stockholders' Equity | 4.79% | 5.62% | - The Corporation's operating strategy focuses on moderate asset growth, expanding diverse loan types, and optimizing the deposit mix towards lower-cost accounts to improve net interest margin[316](index=316&type=chunk) - Critical accounting estimates, including ACL and Provision for Income Taxes, involve significant management judgment and assumptions that can materially impact financial statements[307](index=307&type=chunk)[308](index=308&type=chunk)[311](index=311&type=chunk) [General](index=89&type=section&id=General) Provident Financial Holdings, Inc. operates as a single business segment through Provident Savings Bank, F.S.B., offering banking services and loans in California, facing risks from economic and regulatory changes - Provident Financial Holdings, Inc. operates as a **single business segment** through its subsidiary, Provident Savings Bank, F.S.B.[303](index=303&type=chunk) - The Bank's activities include deposit gathering, banking services, and originating various loan types, primarily in California[303](index=303&type=chunk) Consolidated Financial Position (June 30, 2025) | Metric | Amount (Millions) | | :------------------- | :---------------- | | Total Assets | $1,250 | | Total Deposits | $888.8 | | Stockholders' Equity | $128.5 | [Critical Accounting Estimates](index=91&type=section&id=Critical%20Accounting%20Estimates) Critical accounting estimates, primarily for ACL and income taxes, involve significant judgment, with CECL adoption on July 1, 2023, resulting in a $1.2 million ACL increase and an $824,000 net-of-tax charge - Critical accounting estimates primarily relate to the Allowance for Credit Losses (ACL) on loans and investment securities, and the Provision for Income Taxes[307](index=307&type=chunk) - The Corporation adopted ASC 326 (CECL) on July 1, 2023, resulting in a one-time **$1.2 million increase** to its ACL and an **$824,000 net-of-tax charge** to retained earnings[309](index=309&type=chunk) - The ACL is maintained at a level sufficient for expected losses based on historical experience, current conditions, and reasonable forecasts, with quarterly adjustments[310](index=310&type=chunk) - Income tax accounting involves subjective assumptions and judgments regarding deferred tax assets and liabilities, with future realization dependent on projected taxable income[311](index=311&type=chunk) [Executive Summary and Operating Strategy](index=91&type=section&id=Executive%20Summary%20and%20Operating%20Strategy) Provident Savings Bank focuses on community banking in Southern California, aiming for moderate asset growth by expanding loans and optimizing deposits to improve net interest margin, while managing economic and wildfire risks - The Corporation's operating strategy aims for moderate growth by expanding its loan portfolio and optimizing its deposit mix towards lower-cost accounts[316](index=316&type=chunk) - The primary goal is to enhance core revenue by achieving a higher net interest margin and increasing net interest income[316](index=316&type=chunk) - The California economic environment, including real estate values and the office sector, poses heightened risks, mitigated by the Bank's prudent risk management and underwriting[319](index=319&type=chunk) - Ongoing California wildfire risks could elevate credit risk, potentially requiring higher provisions for loan losses, despite no material direct impact from recent events[320](index=320&type=chunk) [Comparison of Financial Condition at June 30, 2025 and 2024](index=95&type=section&id=Comparison%20of%20Financial%20Condition%20at%20June%2030%2C%202025%20and%202024) At June 30, 2025, total assets decreased by 2% to $1.25 billion, driven by reductions in investment securities and loans, while deposits remained stable and borrowings decreased Key Financial Condition Changes (June 30, 2025 vs. 2024) | Metric | June 30, 2025 (Millions) | June 30, 2024 (Millions) | YoY Change (Millions) | YoY Change (%) | | :-------------------------- | :----------------------- | :----------------------- | :-------------------- | :------------- | | Total Assets | $1,250 | $1,272 | $(26.6) | -2% | | Cash & Cash Equivalents | $53.1 | $51.4 | $1.7 | 3% | | Investment Securities | $111.0 | $131.9 | $(20.9) | -16% | | Loans Held for Investment, net | $1,050 | $1,053 | $(7.2) | -1% | | Total Deposits | $888.8 | $888.3 | $0.4 | 0% | | Borrowings | $213.1 | $238.5 | $(25.4) | -11% | | Total Stockholders' Equity | $128.5 | $129.9 | $(1.4) | -1% | - Loan originations for investment increased by **62% to $122.7 million** in fiscal 2025, driven by higher loan prepayments[325](index=325&type=chunk) - Transaction accounts decreased by **6%**, while time deposits increased by **14%**, shifting the deposit mix[327](index=327&type=chunk) [Comparison of Operating Results for the Fiscal Years Ended June 30, 2025 and 2024](index=97&type=section&id=Comparison%20of%20Operating%20Results%20for%20the%20Fiscal%20Years%20Ended%20June%2030%2C%202025%20and%202024) Net income decreased by 15% to $6.3 million in fiscal 2025, primarily due to increased non-interest expense and decreased non-interest income, despite higher net interest income and credit loss recovery Net Income and EPS (Fiscal Year Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | YoY Change (Millions) | | :-------------------- | :-------------- | :-------------- | :-------------------- | | Net Income | $6.3 | $7.4 | $(1.1) | | Diluted EPS | $0.93 | $1.06 | $(0.13) | Net Interest Income and Margin (Fiscal Year Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | YoY Change (Millions) | YoY Change (bps) | | :-------------------- | :-------------- | :-------------- | :-------------------- | :--------------- | | Net Interest Income | $35.5 | $34.9 | $0.5 | | | Net Interest Margin | 2.93% | 2.78% | | 15 | Non-Interest Income and Expense (Fiscal Year Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | YoY Change (Millions) | YoY Change (%) | | :-------------------- | :-------------- | :-------------- | :-------------------- | :------------- | | Non-Interest Income | $3.5 | $3.9 | $(0.4) | -10% | | Non-Interest Expense | $30.8 | $28.5 | $2.3 | 8% | Provision for (Recovery of) Credit Losses (Fiscal Year Ended June 30) | Metric | 2025 (Thousands) | 2024 (Thousands) | | :-------------------------------- | :--------------- | :--------------- | | Recovery of Credit Losses | $(666) | $(63) | [Average Balances, Interest and Average Yields/Costs](index=102&type=section&id=Average%20Balances%2C%20Interest%20and%20Average%20Yields%2FCosts) In fiscal 2025, average interest-earning assets and interest-bearing liabilities both decreased by 3%, while net interest margin improved by 15 bps to 2.93% due to higher loan yields Average Balances, Interest, and Yields/Costs (Fiscal Year Ended June 30) | Metric | 2025 Average Balance (Millions) | 2025 Interest (Millions) | 2025 Yield/Cost | 2024 Average Balance (Millions) | 2024 Interest (Millions) | 2024 Yield/Cost | | :-------------------------------- | :------------------------------ | :----------------------- | :-------------- | :------------------------------ | :----------------------- | :-------------- | | Loans receivable, net | $1,051.4 | $52.5 | 5.00% | $1,069.6 | $50.2 | 4.69% | | Investment securities | $121.4 | $1.9 | 1.53% | $144.5 | $2.1 | 1.43% | | Total interest-earning assets | $1,212.1 | $56.6 | 4.67% | $1,254.3 | $54.7 | 4.36% | | Total deposits | $881.7 | $11.2 | 1.27% | $916.1 | $9.7 | 1.06% | | Borrowings | $216.3 | $9.9 | 4.59% | $221.4 | $10.1 | 4.58% | | Total interest-bearing liabilities| $1,098.0 | $21.2 | 1.93% | $1,137.4 | $19.8 | 1.74% | | Net interest income | | $35.5 | | | $34.9 | | | Interest rate spread | | | 2.74% | | | 2.62% | | Net interest margin | | | 2.93% | | | 2.78% | [Rate/Volume Variance](index=103&type=section&id=Rate%2FVolume%20Variance) Net interest income increased by $546,000 in fiscal 2025, driven by a positive rate variance of $2.815 million, offsetting a negative volume variance of $2.191 million Rate/Volume Variance on Net Interest Income (Fiscal Year Ended June 30, 2025 vs. 2024) | (In Thousands) | Rate (Increase/Decrease) | Volume (Increase/Decrease) | Rate/Volume (Increase/Decrease) | Net (Increase/Decrease) | | :----------------------------------------- | :----------------------- | :------------------------- | :------------------------------ | :---------------------- | | Total net change in income on interest-earning assets | $3,180 | $(1,218) | $(68) | $1,894 | | Total net change in expense on interest-bearing liabilities | $365 | $973 | $10 | $1,348 | | **Net increase (decrease) in net interest income** | **$2,815** | **$(2,191)** | **$(78)** | **$546** | [Liquidity and Capital Resources](index=103&type=section&id=Liquidity%20and%20Capital%20Resources) The Bank's liquidity is sourced from deposits, loan repayments, and borrowings, with $53.1 million in cash and $474.8 million in available borrowing capacity, and remains 'well capitalized' at June 30, 2025 - The Bank's primary liquidity sources are deposits, loan repayments, and investment securities, supplemented by FHLB, FRB, and correspondent bank borrowings[363](index=363&type=chunk) Available Borrowing Capacity (June 30, 2025) | Source | Available Capacity (Millions) | | :-------------------------- | :---------------------------- | | FHLB – San Francisco | $282.3 | | FRB of San Francisco | $142.5 | | Correspondent Bank | $50.0 | | **Total Available Capacity**| **$474.8** | - The Bank's average liquidity ratio decreased to **8.9%** in Q4 fiscal 2025 from **16.6%** in Q4 fiscal 2024, but management deems it sufficient[369](index=369&type=chunk) - The Bank was **'well capitalized'** at June 30, 2025, with **Tier 1 Leverage Capital of 10.1%**, **CET1 Capital of 19.5%**, **Tier 1 Risk-based Capital of 19.5%**, and **Total Risk-based Capital of 20.5%**[376](index=376&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures about Market Risk](index=107&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The Corporation manages interest rate risk through its Asset-Liability Committee, using an internal model to assess NPV sensitivity, and was asset sensitive at June 30, 2025, with an improved NPV ratio of 12.15% - The Corporation's primary market risk is interest rate risk, managed by aligning repricing mismatches between assets and liabilities[377](index=377&type=chunk)[378](index=378&type=chunk) Estimated Changes in Net Portfolio Value (NPV) at June 30, 2025 (Millions) | Basis Points Change in Rates | NPV Change | NPV as Percentage of Portfolio Value Assets | | :--------------------------- | :--------- | :------------------------------------------ | | +300 bp | $(18.9) | 10.91% | | +200 bp | $(5.7) | 11.82% | | +100 bp | $1.0 | 12.25% | | - | $0 | 12.15% | | -100 bp | $(1.5) | 12.02% | | -200 bp | $(13.1) | 11.17% | | -300 bp | $(13.2) | 11.14% | - At June 30, 2025, the Corporation was asset sensitive, projecting increased net interest income in a rising rate environment (except at +300 bp) and decreased income in a falling rate environment over the next 12 months[395](index=395&type=chunk)[396](index=396&type=chunk) Net Interest Income Sensitivity to Rate Changes (Fiscal Year Ended June 30) | Basis Point (bp) Change in Rates | 2025 Change in Net Interest Income | 2024 Change in Net Interest Income | | :------------------------------- | :--------------------------------- | :--------------------------------- | | +300 bp | -1.35% | -8.12% | | +200 bp | +2.01% | -3.45% | | +100 bp | +2.23% | -0.51% | | -100 bp | -1.80% | -0.67% | | -200 bp | -3.24% | -1.15% | | -300 bp | -6.38% | -1.86% | [Item 8. Financial Statements and Supplementary Data](index=114&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section incorporates the Consolidated Financial Statements and accompanying Notes by reference into this Form 10-K - The Consolidated Financial Statements and Notes are incorporated by reference[400](index=400&type=chunk) [Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure](index=114&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20With%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) There have been no changes in or disagreements with accountants on accounting and financial disclosure - There are no changes in or disagreements with accountants on accounting and financial disclosure[401](index=401&type=chunk) [Item 9A. Controls and Procedures](index=114&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of June 30, 2025, with no material changes during the quarter - The Corporation's disclosure controls and procedures were deemed effective at a reasonable assurance level as of June 30, 2025[402](index=402&type=chunk) - No material changes occurred in the Corporation's internal control over financial reporting during the quarter ended June 30, 2025[402](index=402&type=chunk) - Management concluded that the Corporation's internal control over financial reporting was effective as of June 30, 2025, based on the COSO framework[406](index=406&type=chunk) - The Corporation complied with federal laws and regulations pertaining to insider loans and dividend restrictions during the fiscal year ended June 30, 2025[407](index=407&type=chunk) [Item 9B. Other Information](index=117&type=section&id=Item%209B.%20Other%20Information) This section contains no additional information [Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=117&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) This item is not applicable to the Corporation - Disclosure regarding foreign jurisdictions that prevent inspections is not applicable[411](index=411&type=chunk) [PART III](index=117&type=section&id=PART%20III) [Item 10. Directors, Executive Officers and Corporate Governance](index=117&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on Directors, Executive Officers, and Corporate Governance is incorporated by reference from the Proxy Statement, including the Code of Ethics and Audit Committee details - Information on Directors, Executive Officers, and Corporate Governance is incorporated by reference from the Proxy Statement[413](index=413&type=chunk)[414](index=414&type=chunk) - The Corporation maintains a Code of Ethics for all directors, officers, and employees, available on its website[415](index=415&type=chunk) - The Audit Committee comprises three independent directors, with Judy A. Carpenter designated as the audit committee financial expert[416](index=416&type=chunk) - No directors or officers adopted or terminated Rule 10b5-1 trading arrangements during the quarter ended June 30, 2025[418](index=418&type=chunk) [Item 11. Executive Compensation](index=119&type=section&id=Item%2011.%20Executive%20Compensation) Executive and director compensation information is incorporated by reference from the Corporation's Proxy Statement - Executive and director compensation information is incorporated by reference from the Proxy Statement[420](index=420&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=119&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Security ownership information is incorporated by reference from the Proxy Statement, with 373,650 securities to be issued under equity compensation plans at a weighted average exercise price of $15.51 - Security ownership information for beneficial owners and management is incorporated by reference from the Proxy Statement[421](index=421&type=chunk) - The Corporation is not aware of any arrangements that could lead to a change in control[421](index=421&type=chunk) Equity Compensation Plan Information (June 30, 2025) | Plan Category | Securities to Be Issued Upon Exercise | Weighted Average Exercise Price | Securities Remaining Available | | :-------------------------- | :------------------------------------ | :------------------------------ | :----------------------------- | | 2010 Equity Incentive Plan | 15,000 | $20.19 | — | | 2013 Equity Incentive Plan | 104,650 | $18.16 (Stock Options) | — | | 2022 Equity Incentive Plan | 254,000 | $13.25 (Stock Options) | 119,000 | | **Total** | **373,650** | **$15.51** | **119,000** | [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=120&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information on certain relationships, related transactions, and director independence is incorporated by reference from the Corporation's Proxy Statement - Information on certain relationships, related transactions, and director independence is incorporated by reference from the Proxy Statement[424](index=424&type=chunk)[425](index=425&type=chunk) [Item 14. Principal Accountant Fees and Services](index=120&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information regarding principal accountant fees and services is incorporated by reference from the Corporation's Proxy Statement - Information on principal accountant fees and services is incorporated by reference from the Proxy Statement[426](index=426&type=chunk) [PART IV](index=122&type=section&id=PART%20IV) [Item 15. Exhibits and Financial Statement Schedules](index=122&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists financial statements, schedules, and exhibits filed as part of this Form 10-K, with many incorporated by reference from previous SEC filings - The Consolidated Financial Statements are included starting on page 79 of this Form 10-K[428](index=428&type=chunk) - Financial statement schedules are omitted as the required information is inapplicable[428](index=428&type=chunk) - A detailed list of exhibits, including corporate governance documents, compensation agreements, and equity plans, is provided, with many incorporated by reference[429](index=429&type=chunk)[430](index=430&type=chunk) [Item 16. Form 10-K Summary](index=126&type=section&id=Item%2016.%20Form%2010-K%20Summary) This item indicates that no Form 10-K Summary is provided - No Form 10-K Summary is provided[432](index=432&type=chunk)

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** |

Core Viewpoint - Provident Financial reported a decline in revenue and earnings per share (EPS) for the quarter ended June 2025, missing both revenue and EPS estimates [1][3]. Financial Performance - Revenue for the quarter was $9.76 million, a year-over-year decline of 1.6%, and a surprise of -6.14% compared to the Zacks Consensus Estimate of $10.4 million [1]. - EPS for the quarter was $0.24, down from $0.28 a year ago, with an EPS surprise of -17.24% against the consensus estimate of $0.29 [1]. - Net Interest Margin was reported at 2.9%, below the estimated 3.1% [4]. - Efficiency ratio stood at 78.1%, higher than the average estimate of 73.9% [4]. - Total Non-Interest Income was $0.88 million, compared to the average estimate of $0.96 million [4]. - Net Interest Income was reported at $8.88 million, below the estimated $9.43 million [4]. Stock Performance - Shares of Provident Financial have returned -1.5% over the past month, while the Zacks S&P 500 composite increased by +4.9% [3]. - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3].

Core Viewpoint - Provident Financial reported quarterly earnings of $0.24 per share, missing the Zacks Consensus Estimate of $0.29 per share, representing a year-over-year decline from $0.28 per share [1][2] Financial Performance - The company posted revenues of $9.76 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 6.14%, and down from $9.92 million a year ago [2] - Over the last four quarters, Provident Financial has surpassed consensus EPS estimates two times and topped revenue estimates only once [2] Stock Performance - Provident Financial shares have declined approximately 2.6% since the beginning of the year, contrasting with the S&P 500's gain of 8.6% [3] - The current Zacks Rank for the stock is 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.30 on revenues of $10.6 million, and for the current fiscal year, it is $1.15 on revenues of $43 million [7] - The estimate revisions trend for Provident Financial was mixed ahead of the earnings release, which could change following the recent report [6] Industry Context - The Financial - Savings and Loan industry is currently in the bottom 30% of the Zacks industry rankings, suggesting potential challenges for stocks in this sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact investor sentiment [5]

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].

Core Points - Provident Financial Holdings, Inc. has appointed Peter C. Fan as Senior Vice President, Chief Financial Officer, and Corporate Secretary effective May 12, 2025 [1] - Mr. Fan has extensive financial leadership experience, particularly in strategic corporate initiatives, liquidity and capital planning, and asset-liability management [2] - Provident Financial Holdings is the largest independent community bank in Riverside County, California, with over $1.3 billion in total assets and 13 retail banking centers [3] Company Overview - Provident has been serving the financial needs of its community since 1956, focusing on accepting deposits and investing in various types of loans including single-family, multi-family, and commercial real estate [3] - The company emphasizes its community banking operations, which have been beneficial for local customers and communities [2]