Credit Losses and Charge-offs - The allowance for credit losses increased by $415,000, or 5.1%, primarily due to updates in prepayment assumptions and adjustments to qualitative and quantitative factors [111]. - The allowance for credit losses at the end of the period was $8,539,000, compared to $8,124,000 at the end of the previous year [111]. - Net charge-offs for the year ended December 31, 2024 totaled $2.4 million, compared to $2.1 million for the year ended 2023 [113]. - The allowance for credit losses to total loans outstanding at the end of the period was 0.88%, up from 0.81% in the previous year [111]. - The total charge-offs for the year were $4,726,000, compared to $4,475,000 in the previous year [111]. - The allowance for credit losses to non-performing loans at the end of the period was 206.56%, an increase from 194.31% in the previous year [111]. - The company had net recoveries of $2,328,000 for the year ended December 31, 2024, compared to $2,410,000 in the previous year [111]. Investment Portfolio - The investment portfolio had a fair value of $159.9 million as of December 31, 2024, primarily consisting of U.S. Government securities and corporate bonds [117]. - The weighted average yield of investment securities was calculated without tax equivalent adjustments, reflecting the income divided by amortized cost [124]. - The average yield on total securities was 2.98%, with U.S. Treasury securities yielding 3.57% [125]. - The aggregate fair value of FHLB common stock was $4.0 million as of December 31, 2024, based on its par value [122]. Deposits and Accounts - Total deposits as of December 31, 2024, amounted to $1.02 billion, with uninsured deposits estimated at $278.3 million [129]. - The average balance of non-interest-bearing demand accounts was $242.6 million, representing 23.45% of total deposits, while interest-bearing demand accounts averaged $124.1 million at a rate of 0.14% [132]. - Certificates of deposit totaled $339.1 million, with an average rate paid of 4.58%, up from 3.74% in 2023 [132]. - Uninsured deposits after exclusions accounted for 26.4% of total deposits, with a coverage ratio of 227.6% [133]. Employment and Workforce - The company had 157 full-time employees and 11 part-time employees as of December 31, 2024, with an average tenure of 7 years and 8 months [143]. - Approximately 61% of the workforce was female, indicating a commitment to diversity [144]. Regulatory Compliance and Capital Requirements - Rhinebeck Bank exceeded all capital requirements as of December 31, 2024 [169]. - The bank is classified as "well capitalized" with a total risk-based capital ratio of 10.0% or greater [176]. - Rhinebeck Bank is subject to comprehensive regulation by the NYSDFS and the FDIC, ensuring safety and soundness [155]. - The bank's capital standards require a common equity Tier 1 capital ratio of at least 4.5% [166]. - Regulatory relief legislation allows for a community bank leverage ratio of 9% for qualifying institutions [168]. - The bank must obtain regulatory approvals before entering into mergers or acquisitions [164]. - The bank's investment activities are limited to certain types of debt and equity securities [173]. - The bank's lending activities include a variety of mortgage and commercial loans [159]. - The FDIC has the authority to assess civil money penalties and issue cease and desist orders for regulatory violations [165]. - The bank's executive officers and directors are subject to specific regulations regarding loans and credit extensions [162]. - The bank is required to submit a capital restoration plan if classified as undercapitalized, with a guarantee from its holding company equal to the lesser of 5.0% of total assets or the amount necessary to achieve adequately capitalized status [177]. - Transactions with affiliates are limited to 10.0% of the bank's capital stock and surplus for any one affiliate, and 20.0% for all affiliates combined [178]. - Loans to insiders, including executive officers and directors, cannot exceed specified limits and must be made on terms substantially the same as those offered to unaffiliated persons [179]. Deposit Insurance and CRA Ratings - Deposit accounts are insured by the FDIC up to a maximum of $250,000 per depositor per account ownership category [180]. - The FDIC's risk-based assessment system for deposit insurance currently ranges from 2.5 to 32 basis points of total assets less tangible capital for banks with less than $10 billion in assets [182]. - The bank's latest CRA rating was "Needs to Improve," and new regulations will be applicable starting January 1, 2026 [193]. - The bank's most recent rating under New York's community reinvestment law was "Satisfactory" [194]. Holding Company and Dividend Policies - The bank holding company is not subject to holding company capital requirements unless advised by the Federal Reserve Board, as it has less than $3.0 billion in consolidated assets [198]. - A bank holding company must notify the Federal Reserve Board of any purchase or redemption of equity securities if it equals 10% or more of consolidated net worth [199]. - Rhinebeck Bancorp, Inc. may face restrictions on paying dividends due to Federal Reserve Board policies requiring dividends to be paid only from current earnings and consistent with capital needs [200]. - Rhinebeck Bancorp, MHC is unlikely to waive dividends from Rhinebeck Bancorp, Inc. due to Federal Reserve Board restrictions, which may affect public stockholders' interests [202]. - Rhinebeck Bancorp, Inc. raised significantly less capital than expected by selling only a minority of its shares to the public, impacting its ability to pay dividends [203]. - A potential future conversion of Rhinebeck Bancorp, MHC from mutual to capital stock form would require approval from the NYSDFS and the Federal Reserve Board [204]. - Any acquisition of control over Rhinebeck Bancorp, Inc. requires prior non-objection or approval from the Federal Reserve Board, with control defined as owning 25% or more of voting securities [205]. - Rhinebeck Bancorp, MHC and Rhinebeck Bancorp, Inc. must receive approval from NYSDFS before acquiring 10% or more of another banking institution's voting stock [206]. Taxation - Rhinebeck Bancorp, Inc. is subject to federal income taxation and reports income on an accrual basis, with a tax year ending December 31 [211]. - As of December 31, 2024, Rhinebeck Bank had no capital loss carryovers, indicating a stable financial position [212]. - The New York State statutory tax rate is currently 6.5% for general business taxpayers, increasing to 7.25% for those with business income over $5 million [214].

Financial Performance - Rhinebeck Bancorp reported a net loss of $2.7 million for Q4 2024, compared to a net income of $930,000 in Q4 2023, resulting in a diluted loss per share of $0.25[1] - For the year ended December 31, 2024, the net loss totaled $8.6 million, compared to a net income of $4.4 million for 2023, with a diluted loss per share of $0.80[1] - Net (loss) income for the year 2024 was $(8,620,000), compared to $4,395,000 in 2023, reflecting a significant decline[20] Income and Expenses - Net interest income for Q4 2024 increased by $1.4 million, or 14.8%, to $10.5 million compared to Q4 2023, while for the year, it increased by $266,000, or 0.7%, to $38.2 million[3] - Total interest and dividend income for Q4 2024 was $16,307,000, an increase of 4.6% from $15,584,000 in Q4 2023[20] - Net interest income after provision for credit losses for the year 2024 was $35,431,000, a decrease of 2.3% from $36,263,000 in 2023[20] - Non-interest (loss) income for Q4 2024 was $(2,512,000), compared to $1,400,000 in Q4 2023, indicating a decline of 279.0%[20] Credit Losses - The provision for credit losses increased by $1.2 million to $1.4 million for Q4 2024, and for the year, it rose by $1.1 million, or 64.5%, to $2.8 million[7] - Provision for credit losses increased significantly to $2,800,000 in 2024 from $1,702,000 in 2023, reflecting a rise of 64.5%[20] - The allowance for credit losses on loans as a percent of total gross loans was 0.88% for both 2024 and 2023, indicating stable asset quality[26] Assets and Liabilities - Total assets decreased by $57.4 million, or 4.4%, to $1.26 billion at December 31, 2024, with loans receivable down by $37.1 million, or 3.7%[13] - Total assets decreased to $1,255,765,000 in 2024 from $1,313,202,000 in 2023, a reduction of 4.4%[21] - Total liabilities decreased by $65.6 million, or 5.5%, to $1.13 billion at December 31, 2024, primarily due to a decrease in borrowings and deposits[15] - Total liabilities decreased to $1,133,932,000 in 2024 from $1,199,517,000 in 2023, a decline of 5.5%[21] Stockholders' Equity - Stockholders' equity increased by $8.1 million, or 7.2%, to $121.8 million at December 31, 2024, despite a net loss of $8.6 million[16] - Total stockholders' equity increased to $121,833,000 in 2024 from $113,685,000 in 2023, an increase of 7.2%[21] - The tangible book value per common share increased to $10.75 in 2024 from $10.04 in 2023, reflecting a growth of approximately 7.1%[31] Efficiency and Profitability - The efficiency ratio improved to 82.64% for the three months ended December 31, 2024, compared to 86.52% in the same period of 2023[26] - The return on average assets for the year ended December 31, 2024, was (0.67)%, down from 0.33% in 2023, reflecting a decline in asset efficiency[26] - The average yield on interest-earning assets improved by 55 basis points to 5.60% in Q4 2024, despite a 5.4% decrease in the average balance of these assets[4] - The net interest margin for Q4 2024 was 3.61%, an increase from 2.96% in Q4 2023, indicating improved profitability[22] Ratios - The average interest-earning assets to average interest-bearing liabilities ratio improved to 136.07% in Q4 2024 from 132.96% in Q4 2023[22] - The average interest-earning assets to average interest-bearing liabilities ratio was 133.68% for the year ended December 31, 2024, slightly down from 133.80% in 2023[26] - Basic earnings per share excluding securities loss restructure for the year ended December 31, 2024, was $0.38, compared to $0.41 in 2023[30] Overdue Accounts - The percentage of overdue account balances to total loans decreased to 1.71% as of December 31, 2024, down from 1.90% at the end of 2023[8]

Financial Performance - Rhinebeck Bancorp reported a net loss of $8.1 million for Q3 2024, compared to a net income of $0.1 million in Q3 2023, resulting in a loss per share of $0.75[2] - Year-to-date net loss for the first nine months of 2024 totaled $6.0 million, a significant decline from net income of $3.5 million in the same period last year[2] - The company reported a net loss of $8,062,000 for the three months ended September 30, 2024, compared to a net income of $1,236,000 for the same period in 2023, indicating a significant decline[16] - The return on average assets for the three months ended September 30, 2024, was (2.52)%, a decrease from 0.37% in the same period of 2023[20] Income and Expenses - Net interest income for Q3 2024 was $9.7 million, a slight increase of $41,000 or 0.4% compared to Q3 2023, while year-to-date net interest income decreased by $1.1 million or 3.8% to $27.7 million[3] - Non-interest (loss) income for Q3 2024 totaled $(10.0) million, a decrease of $11.7 million from $1.6 million in Q3 2023, primarily due to a $12.0 million loss on the sale of investment securities[6] - Non-interest expense for the three months ended September 30, 2024, was $9,081,000, compared to $8,815,000 for the same period in 2023, representing an increase of 3.0%[16] - The net interest income plus non-interest income (non-GAAP) for the three months ended September 30, 2024, was $11,667 thousand, up from $11,304 thousand in the same period of 2023[21] Assets and Liabilities - Total assets decreased by $47.1 million or 3.6% to $1.27 billion at September 30, 2024, with loans receivable down by $44.0 million or 4.4%[10] - Total liabilities decreased by $56.0 million or 4.7% to $1.14 billion at September 30, 2024, driven by a decrease in borrowings and escrow accounts[12] - Total assets decreased to $1,266,145,000 as of September 30, 2024, from $1,313,202,000 as of December 31, 2023, reflecting a reduction of approximately 3.6%[17] - Total liabilities decreased to $1,151,023 thousand in 2024 from $1,224,648 thousand in 2023, a decline of about 5.99%[18] Equity and Capital - Stockholders' equity increased by $9.0 million or 7.9% to $122.7 million at September 30, 2024, primarily due to a decrease in accumulated other comprehensive loss[13] - The company reported a total stockholders' equity of $119,363 thousand in 2024, up from $108,327 thousand in 2023, representing an increase of approximately 10.51%[18] - The total capital to risk-weighted assets ratio was 12.81% for the three months ended September 30, 2024, compared to 12.47% in the same period of 2023[20] Credit Quality - The provision for credit losses decreased by $21,000 or 2.3% to $889,000 for Q3 2024, reflecting a decrease in loan balances[4] - Non-performing assets increased by $584,000 or 13.9% to $4.8 million at September 30, 2024, with the percentage of overdue account balances to total loans decreasing to 1.62%[5] - The allowance for credit losses on loans as a percent of total gross loans was 0.84% for the three months ended September 30, 2024, consistent with 0.85% in the same period of 2023[20] - Non-performing loans as a percent of total gross loans were 0.50% for the three months ended September 30, 2024, compared to 0.48% in the same period of 2023[20] Interest and Yield - Total interest and dividend income for the three months ended September 30, 2024, was $16,040,000, an increase from $15,534,000 for the same period in 2023, representing a growth of 3.3%[16] - Net interest income after provision for credit losses was $8,810,000 for the three months ended September 30, 2024, compared to $8,748,000 for the same period in 2023, showing a slight increase of 0.7%[16] - The net interest margin for the three months ended September 30, 2024, was 3.26%, compared to 3.09% in the same period of 2023[20] - The average interest-earning assets to average interest-bearing liabilities ratio was 132.92% in 2024, slightly down from 134.08% in 2023[19] Other Financial Metrics - The efficiency ratio (non-GAAP) for the three months ended September 30, 2024, was 77.83%, slightly improved from 77.98% in the same period of 2023[21] - The tangible book value per common share (non-GAAP) was $10.85 as of September 30, 2024, compared to $9.41 in the same period of 2023[25] - The book value per common share increased to $11.06 as of September 30, 2024, from $9.63 in the same period of 2023[25]

Financial Performance - Net loss for the third quarter of 2024 was $8.1 million, compared to net income of $1.2 million for the third quarter of 2023, resulting in a diluted loss per share of $0.75[176]. - Non-interest income decreased by $11.7 million, or 709.2%, in the third quarter of 2024 compared to the same quarter in 2023[176]. - The company reported a $12.0 million pre-tax loss from the previously announced balance sheet restructuring for both the third quarter and nine months of 2024[178]. - Non-interest loss totaled $10.0 million for Q3 2024, a decrease of $11.7 million from the previous year, primarily due to a $12.0 million loss on the sale of investment securities[187]. - The income tax benefit for Q3 2024 was $2.2 million at a negative effective tax rate of 21.72%, reflecting a lower pre-tax income compared to the prior year[191]. Asset and Liability Management - Total assets decreased by $47.1 million, or 3.6%, to $1.27 billion at September 30, 2024, compared to $1.31 billion at December 31, 2023[164]. - Total liabilities decreased by $56.0 million, or 4.7%, to $1.14 billion at September 30, 2024, mainly due to a decrease in Federal Home Loan Bank advances of $68.3 million[170]. - Total available sources of funds amounted to $646.8 million as of September 30, 2024, including cash and cash equivalents of $46.4 million and unencumbered securities of $90.6 million[210]. - The estimated economic value of equity (EVE) would decrease by $34.375 million (22.2%) if interest rates increased by 400 basis points[204]. - The company maintains liquid assets to meet both short-term and long-term liquidity needs, adjusting levels as necessary to fund deposit outflows and loan commitments[205]. Loans and Deposits - Net loans receivable decreased by $44.0 million, or 4.4%, to $964.9 million at September 30, 2024, primarily due to a decrease in indirect automobile loans of $75.3 million, or 19.1%[167]. - Deposits increased by $15.7 million, or 1.5%, to $1.05 billion at September 30, 2024, with interest-bearing accounts increasing by $8.6 million, or 1.1%[171]. - Cash and cash equivalents increased by $24.3 million, or 109.6%, to $46.4 million at September 30, 2024, primarily due to an increase in deposits held at various banks[165]. - Net charge-offs decreased by $41,000 to $344,000 for Q3 2024, with overdue account balances to total loans decreasing to 1.62%[186]. Interest Income and Expense - Net interest income increased by $41,000, or 0.4%, to $9.7 million for Q3 2024 compared to Q3 2023, with a net interest margin of 3.26%[179]. - Interest income rose by $506,000, or 3.3%, to $16.0 million for Q3 2024, driven by a higher average yield of interest-earning assets at 5.39%[181]. - Interest expense increased by $465,000, or 7.9%, to $6.3 million for Q3 2024, with the average cost of interest-bearing liabilities rising to 2.88%[183]. - Interest income for the nine months ended September 30, 2024, increased by $2.4 million, or 5.3%, to $47.5 million compared to the same period in 2023[182]. Equity and Stockholder Information - Stockholders' equity increased by $9.0 million, or 7.9%, to $122.7 million at September 30, 2024, with a book value per share of $11.06[175]. - Total stockholders' equity increased from $108,327 million in September 2023 to $119,363 million in September 2024[195]. - The company has a stock repurchase plan authorized for up to 247,506 shares, with 47,506 shares remaining available for repurchase as of September 30, 2024[219]. Operational Efficiency - Non-interest expense for Q3 2024 was $9.1 million, an increase of $266,000, or 3.0%, mainly due to higher salaries and benefits[189]. - Non-interest expense for the first nine months of 2024 decreased by $402,000, or 1.5%, to $26.9 million, primarily due to reduced retail banking and lending expenses[190]. - The Asset/Liability Management Committee (ALCO) regularly reviews the company's asset/liability management process to mitigate interest rate risk[200]. - The company has not experienced any material changes in risk factors since the last annual report, maintaining a stable operational environment[218].

Financial Condition and Reporting - The press release regarding the financial condition was issued on September 27, 2024[2] - The report includes a cover page formatted in Inline XBRL[2] - The Chief Financial Officer, Kevin Nihill, signed the report on September 27, 2024[4] Company Classification and Trading - The company is classified as an emerging growth company under the Securities Act of 1933[1] - The registrant's common stock is traded on the NASDAQ Stock Market under the symbol RBKB[1] - The registrant's principal executive offices are located in Poughkeepsie, New York[1] Financial Performance and Developments - Rhinebeck Bancorp, Inc. announced a recent balance sheet restructuring related to its investment securities portfolio[3] - No specific financial performance metrics or user data were disclosed in the provided documents[3] - There is no mention of new products, technologies, market expansion, or acquisitions in the available information[3] Accounting Standards - The company has not elected to use the extended transition period for new financial accounting standards[1]

Financial Performance - Net income for the three months ended June 30, 2024, decreased by $456,000, or 31.9%, to $975,000, or $0.09 per diluted share, compared to $1.4 million, or $0.13 per diluted share, for the same period in 2023[146] - Net interest income decreased by $163,000, or 1.8%, to $9.1 million for the three months ended June 30, 2024[148] - Non-interest income totaled $1.5 million for Q2 2024, an increase of $156,000, or 11.5%, primarily due to a 61.5% increase in investment advisory income[156] - Non-interest expense decreased by $342,000, or 3.7%, to $8.9 million for Q2 2024, mainly due to a 25.6% decrease in professional fees[158] - Income taxes decreased by $108,000, or 27.7%, for Q2 2024 compared to Q2 2023, with an effective tax rate of 22.43%[160] Asset and Liability Management - Total assets decreased by $37.2 million, or 2.8%, to $1.28 billion at June 30, 2024, compared to $1.31 billion at December 31, 2023[136] - Total net loans receivable decreased by $26.5 million, or 2.6%, to $982.4 million at June 30, 2024, primarily due to a decrease in indirect automobile loans of $50.7 million, or 12.9%[138] - Deposits increased by $1.4 million, or 0.1%, to $1.032 billion at June 30, 2024, with interest-bearing accounts increasing by $10.5 million, or 1.3%[142] - Stockholders' equity increased by $2.5 million, or 2.2%, to $116.2 million at June 30, 2024, primarily due to net income of $2.1 million[145] - Advances from the Federal Home Loan Bank decreased by $48.3 million, or 37.7%, to $79.8 million at June 30, 2024[144] Interest Income and Expense - Interest income increased by $837,000, or 5.6%, to $15.8 million for Q2 2024 compared to Q2 2023, primarily due to the rising interest rate environment[149] - Interest expense rose by $1.0 million, or 17.7%, to $6.6 million for Q2 2024, with the average cost of interest-bearing liabilities increasing by 55 basis points to 2.95%[151] - The average yield of interest-earning assets increased by 54 basis points to 5.31% for Q2 2024, while the average balance of interest-earning assets decreased by $61.4 million, or 4.9%[149] - The net interest margin decreased by 9 basis points to 3.00% for the six months ended June 30, 2024[148] - The interest rate spread for the three months ended June 30, 2024, was 2.36% compared to 2.37% in 2023[163] Credit Losses - The provision for credit losses increased by $899,000, or 198.9%, for the three months ended June 30, 2024[146] - The provision for credit losses on loans increased by $899,000, or 198.9%, from a credit of $452,000 in Q2 2023 to an expense of $447,000 in Q2 2024[154] Cash Flow and Liquidity - Net cash provided by operating activities increased to $8.5 million for the six months ended June 30, 2024, compared to $4.4 million for the same period in 2023[175] - Cash inflow from a decrease in loans contributed $25.3 million to investing activities for the six months ended June 30, 2024, compared to $6.3 million in the prior year[175] - The net cash outflow from financing activities was $44.1 million for the six months ended June 30, 2024, primarily due to debt paydown[175] - The company maintains liquid assets to meet both short-term and long-term liquidity needs, adjusting levels as necessary[174] - The company has access to a preapproved secured line of credit with the FHLB totaling $637,912,000 as of June 30, 2024[176] Economic Value and Internal Controls - The estimated economic value of equity (EVE) decreased by 29.9% to $111,094,000 with a 400 basis point increase in interest rates[173] - There were no changes in the company's internal controls over financial reporting that materially affected the financial reporting during the quarter ended June 30, 2024[180]

Financial Performance - Net income for the three months ended March 31, 2024, increased by $323,000, or 40.5%, to $1.1 million, or $0.10 per diluted share, compared to $798,000, or $0.07 per diluted share for the same period in 2023[162] - Non-interest income totaled $1.5 million in Q1 2024, an increase of $130,000, or 9.4%, driven by a 23.3% increase in investment advisory income[168] - Non-interest expense decreased by $326,000, or 3.5%, to $8.9 million in Q1 2024, primarily due to a reduction in salaries and benefits[169] - Income taxes increased by $96,000, or 42.7%, in Q1 2024 compared to Q1 2023, with an effective tax rate of 22.26%[170] Asset and Liability Management - Total assets decreased by $14.4 million, or 1.1%, to $1.30 billion at March 31, 2024, compared to $1.31 billion at December 31, 2023[150] - Total net loans receivable decreased by $15.5 million, or 1.5%, to $993.3 million at March 31, 2024, primarily due to a $27.2 million decrease in indirect automobile loans[153] - Cash and cash equivalents increased by $8.5 million, or 38.6%, to $30.7 million at March 31, 2024, driven by an increase in customer deposits[151] - Deposits increased by $6.5 million, or 0.6%, to $1.04 billion at March 31, 2024, with interest-bearing accounts rising by $19.4 million, or 2.5%[157] - Total interest-earning assets decreased from $1,247.2 million in Q1 2023 to $1,224.2 million in Q1 2024, while total interest-bearing liabilities increased to $928.3 million[171] Credit Quality - The provision for credit losses decreased by $931,000, or 91.8%, indicating improved credit quality[162] - Provision for credit losses on loans decreased by $931,000, or 91.8%, from $1.0 million in Q1 2023 to $83,000 in Q1 2024, attributed to decreased loan production and improved economic conditions[166] - Net charge-offs decreased by $164,000 from $414,000 in Q1 2023 to $250,000 in Q1 2024, with overdue account balances to total loans decreasing to 1.84%[167] Interest Income and Expense - Net interest income decreased by $968,000, or 9.8%, to $8.9 million for the three months ended March 31, 2024[163] - Interest expense increased by $2.0 million, or 42.2%, from $4.7 million in Q1 2023 to $6.7 million in Q1 2024, with the average cost of interest-bearing liabilities rising to 2.92%[165] - The net interest margin decreased from 3.21% in Q1 2023 to 2.92% in Q1 2024, reflecting changes in interest rates and volumes[172] - The average yield on loans increased by 31 basis points, while the average yield on available-for-sale securities increased by 13 basis points[164] Cash Flow and Liquidity - Net cash used in operating activities was $3.5 million for the three months ended March 31, 2024, compared to net cash provided of $3.1 million for the same period in 2023[184] - Net cash provided by investing activities was $27.5 million for the three months ended March 31, 2024, compared to net cash used of $9.6 million for the same period in 2023[185] - A cash inflow of $15.4 million for a decrease in loans was the primary contributor to cash used in investing activities for the three months ended March 31, 2024[185] - The company reported a net cash outflow of $15.5 million in financing activities for the three months ended March 31, 2024, compared to a net cash inflow of $11.3 million in the comparable 2023 period[185] - The company maintains liquid assets at levels considered adequate to meet both short-term and long-term liquidity needs[181] Regulatory and Control Environment - There were no changes in the company's internal controls over financial reporting during the quarter ended March 31, 2024, that materially affected internal control[191] Market Conditions - Changes in market interest rates significantly influence deposit flows and loan and security sales, impacting liquidity management[182] - The company manages interest rate risk through strategies such as originating loans with adjustable rates and promoting core deposit products[177] Equity and Capital - Stockholders' equity increased by $587,000, or 0.5%, to $114.3 million at March 31, 2024, primarily due to net income[161]

Financial Performance - Net income for the quarter ended March 31, 2024, was $1.1 million, a 40.5% increase from $798,000 in the same period of 2023[1][2] - Return on average assets and return on average equity improved to 0.34% and 3.92%, respectively, compared to 0.24% and 2.95% in the first quarter of 2023[2] - Non-interest income totaled $1.5 million, an increase of $130,000, or 9.4%, driven by higher investment advisory income[8] - Non-interest expense decreased by $326,000, or 3.5%, to $8.9 million, primarily due to a reduction in salaries and benefits[9] - The efficiency ratio for the three months ended March 31, 2024, was 85.34%, compared to 81.88% for the same period in 2023[21] Asset and Equity Changes - Tangible book value per share increased by 5.3% to $10.10 from March 31, 2023[3] - Stockholders' equity increased by $587,000, or 0.5%, to $114.3 million, primarily due to net income[13] - Total shareholders' equity (book value) increased to $114,272,000 as of March 31, 2024, up from $110,717,000 in December 2023, representing a growth of 4.7%[25] - Book value per common share increased to $10.32 as of March 31, 2024, compared to $9.81 a year earlier[21] - Tangible common equity (non-GAAP) reached $111,812,000, up from $108,172,000, indicating a growth of 3.4%[25] Loan and Credit Metrics - Provision for credit losses on loans decreased by $931,000, or 91.8%, to $83,000 due to improved economic conditions[6] - The allowance for credit losses on loans as a percentage of total gross loans was 0.80% as of March 31, 2024, down from 0.91% a year earlier[21] - Non-performing loans as a percentage of total gross loans decreased to 0.46% as of March 31, 2024, from 0.57% a year earlier[21] Interest Income and Margin - Net interest income decreased by $968,000, or 9.8%, to $8.9 million due to higher costs of deposits and borrowings[4] - Net interest income for the three months ended March 31, 2024, was $8,896,000, down from $9,864,000 for the same period in 2023[19] - The net interest margin decreased to 2.92% for the three months ended March 31, 2024, compared to 3.21% for the same period in 2023[21] Asset Quality and Stability - Total assets decreased by $14.4 million, or 1.1%, to $1.30 billion, with loans receivable decreasing by $15.5 million[10] - Total assets as of March 31, 2024, were $1,298,784,000, a decrease from $1,313,202,000 as of December 31, 2023[18] - Total deposits increased to $1,037,024,000 as of March 31, 2024, compared to $1,030,503,000 at the end of 2023, reflecting a growth of 0.15%[18] - Average balance of interest-earning assets decreased by $23.0 million, or 1.8%, to $1.22 billion, while average yield improved by 39 basis points to 5.14%[5] Shareholder Value and Growth - The overall financial metrics indicate a positive trend in shareholder value and equity growth[25] - Total shares outstanding decreased to 11,073,000 from 11,284,000, a reduction of 1.9%[25] - Goodwill remained unchanged at $(2,235,000) across the reporting periods[25] - Intangible assets, net decreased to $(225,000) from $(310,000), showing an improvement in asset quality[25] - The company continues to maintain a strong tangible common equity position, reflecting solid financial health[25]

Credit Losses and Loan Portfolio - The allowance for credit losses increased by $181,000, or 2.3%, primarily due to the adoption of the CECL standard and an increase in the loan portfolio [111]. - The allowance for credit losses at the end of the period was $8,124,000, compared to $7,943,000 at the end of the previous year [109]. - Total charge-offs for the year were $4,475,000, an increase from $3,267,000 in the previous year [109]. - Net charge-offs for the year ended December 31, 2023, totaled $2,065,000, compared to $1,030,000 for the year ended December 31, 2022 [113]. - The allowance for credit losses to non-performing loans at the end of the period was 194.31%, up from 179.54% in the previous year [109]. - The allowance for credit losses may not be sufficient to cover actual loan losses, as it is based on management's estimates and assumptions [236]. - The company adopted the current expected credit loss model (CECL) effective January 1, 2023, which significantly changed how it calculates its allowance for credit losses [237]. Investment Portfolio - The investment portfolio had a fair value of $192.0 million as of December 31, 2023, primarily consisting of U.S. Government securities and corporate bonds [120]. - The weighted average yield of investment securities was calculated without tax equivalent adjustments, reflecting the company's strategy of diversified investing [128]. - The company’s investment strategy focuses on maximizing portfolio yield while managing risk consistent with liquidity needs [121]. - The aggregate fair value of FHLB common stock was $6.5 million as of December 31, 2023, based on its par value [126]. - At December 31, 2023, Rhinebeck Bancorp, Inc. held approximately $23.2 million in U.S. government agency securities and $128.6 million in residential mortgage-backed securities issued or guaranteed by government-sponsored enterprises [228]. - Other comprehensive losses, net of tax, amounted to $26.1 million as of December 31, 2023, related to unrealized holding losses in the available-for-sale investment securities portfolio [256]. Deposits and Funding - Total deposits as of December 31, 2023, amounted to $1.031 billion, with no brokered deposits reported [132]. - Average balance of non-interest-bearing demand accounts was $268.1 million, representing 24.74% of total deposits [135]. - Average balance of certificates of deposit was $282.8 million, with a rate paid of 3.74% [135]. - Approximately $295.6 million of the deposit portfolio was uninsured as of December 31, 2023 [135]. - The company had the ability to borrow $656.5 million under credit facilities with the Federal Home Loan Bank [140]. - As of December 31, 2023, total deposits decreased by $99.4 million, or 8.8%, to $1.031 billion from $1.130 billion at December 31, 2022 [240]. - The company relies heavily on deposits as its primary source of funds, and significant withdrawals could adversely affect liquidity and increase funding costs [259]. Capital Requirements and Regulatory Compliance - Rhinebeck Bank exceeded all capital requirements as of December 31, 2023, maintaining a well-capitalized status [177]. - The bank is subject to a comprehensive capital framework requiring a common equity Tier 1 capital ratio of at least 4.5% [174]. - Rhinebeck Bank's total risk-based capital ratio must be at least 10.0% to be classified as well capitalized [182]. - The bank's regulatory structure includes oversight by the NYSDFS and FDIC, ensuring compliance with safety and soundness standards [171]. - The company is subject to more stringent capital requirements, including a common equity Tier 1 capital ratio of 7.0% and a total capital ratio of 10.5% [246]. - The bank must obtain regulatory approvals before entering into mergers or acquisitions [172]. - The FDIC has the authority to assess civil money penalties and issue cease and desist orders for regulatory violations [173]. - The Bank's deposit accounts are insured by the FDIC's Deposit Insurance Fund up to a maximum of $250,000 per separately insured depositor [186]. - The Federal Reserve Board requires bank holding companies to maintain minimum consolidated capital requirements that are as stringent as those for insured depository subsidiaries [200]. Employee and Management Information - The average tenure of employees increased to 7 years and 10 months as of December 31, 2023, up from 6 years and 6 months in 2022 [148]. - The workforce composition was approximately 60% female and 40% male as of December 31, 2023 [148]. - The company had 164 full-time employees and nine part-time employees as of December 31, 2023 [147]. - Michael J. McDermott, the CFO, announced retirement effective May 31, 2024 [152]. Financial Performance and Operational Efficiency - Non-interest expenses totaled $36.4 million for the year ended December 31, 2023, down from $37.4 million in 2022, indicating a decrease in operational costs [255]. - The efficiency ratio was 83.28% for 2023, compared to 78.4% in 2022, suggesting a need for further cost management [255]. - The company faces strong competition in loan and deposit markets, which may pressure net interest income due to lower interest rates on loans and higher rates on deposits [258]. - Cybersecurity risks could lead to increased operating costs and potential liabilities, impacting financial condition and results of operations [251]. - Management's estimates and assumptions in financial reporting are subject to significant risk and uncertainty, which could materially affect financial results [264]. Corporate Structure and Future Outlook - Rhinebeck Bancorp, Inc. expects to lose its emerging growth company status on December 31, 2024 [160]. - The company is classified as an emerging growth company, which allows it to comply with reduced reporting and disclosure requirements [272]. - The common stock may be less attractive to investors if the company relies on exemptions from various reporting requirements [273]. - The company has exemptions from holding non-binding advisory votes on executive compensation [273]. - The board of directors intends to retain future earnings for business use and does not expect to pay cash dividends in the foreseeable future [266]. - Rhinebeck Bancorp, MHC may convert from mutual to capital stock form of ownership, pending approval from the NYSDFS and the Federal Reserve Board [205]. - The company must receive prior approval from the Federal Reserve Board before any person or entity can acquire control of Rhinebeck Bancorp, Inc. [207]. - The USA PATRIOT Act requires federal banking agencies to consider the effectiveness of controls against money laundering when approving mergers or acquisitions [214]. Economic Environment - The annual inflation rate in the United States decreased from a high of 9.1% in June 2022 to 3.4% as of December 31, 2023 [229]. - The Federal Reserve increased the target federal funds rate by 425 basis points in 2022 to combat inflation [229].

Financial Performance - Net income for the three months ended September 30, 2023, decreased by $871,000, or 41.3%, to $1.2 million, or $0.11 per diluted share, compared to $2.1 million, or $0.19 per diluted share, for the same period in 2022[173] - Net interest income for the three months ended September 30, 2023, decreased by $1.4 million, or 13.0%, to $9.7 million compared to $11.1 million for the same quarter in 2022[175] - Non-interest income increased by $257,000, or 18.5%, for the three months ended September 30, 2023[173] - Non-interest income for Q3 2023 totaled $1.6 million, an increase of $257,000, or 18.5%, primarily due to a gain on life insurance[186] - Net interest income for the nine months ended September 30, 2023, was $28,822 thousand, down from $32,078 thousand in 2022, a decrease of 10.5%[195] - Non-interest income for the nine months ended September 30, 2023 decreased by $223,000, or 4.8%, to $4.4 million, primarily due to a decrease in net gain on sales of mortgage loans[187] Asset and Liability Management - Total assets decreased by $20.5 million, or 1.5%, to $1.315 billion at September 30, 2023, compared to $1.336 billion at December 31, 2022[163] - Total net loans receivable increased by $9.4 million, or 0.9%, to $1.004 billion at September 30, 2023, with commercial real estate loans increasing by $47.5 million, or 12.8%[166] - Deposits decreased by $47.6 million, or 4.2%, to $1.082 billion at September 30, 2023, with interest-bearing accounts decreasing by $41.0 million, or 4.8%[169] - Stockholders' equity decreased by $1.5 million, or 1.4%, to $106.7 million at September 30, 2023, primarily due to a $3.4 million increase in accumulated other comprehensive loss[172] - Total interest-bearing liabilities increased to $931,178 thousand in 2023 from $841,157 thousand in 2022, an increase of 10.7%[195] Interest Income and Expense - Interest income increased by $3.0 million, or 23.7%, to $15.5 million for Q3 2023 compared to Q3 2022, driven by a rising interest rate environment and an increase in the average balance of loans[177] - Interest expense surged by $4.4 million, or 303.6%, to $5.9 million for Q3 2023, with the average cost of interest-bearing liabilities increasing by 182 basis points to 2.50%[180] - The average yield on loans increased to 5.44% in 2023 from 4.76% in 2022, an increase of 14.3%[195] Credit Losses - The provision for credit losses increased by $365,000 for the three months ended September 30, 2023[173] - The provision for credit losses on loans increased by $365,000 to $910,000 for Q3 2023, attributed to higher loan balances and increased charge-offs[182] Cash Flow and Investments - Net cash provided by operating activities was $6.9 million for the nine months ended September 30, 2023, down from $16.0 million in the same period of 2022[209] - Net cash provided by investing activities was $12.6 million for the nine months ended September 30, 2023, compared to a net cash outflow of $84.3 million in the prior year[209] - Cash outlays for the purchase of securities decreased from $30.2 million in the first nine months of 2022 to $0 in the same period of 2023[209] Regulatory and Operational Considerations - The effective tax rate for Q3 2023 was 21.72%, a slight decrease from 22.02% in Q3 2022, reflecting a decrease in income before income taxes[190] - There were no changes in the company's internal controls over financial reporting that materially affected the company during the quarter ended September 30, 2023[217] - As of the date of the report, the company is not involved in any pending legal proceedings that would materially affect its financial condition[219] Market Conditions - The impact of inflation has increased the cost of operations, but the company's assets and liabilities are primarily monetary, making them more sensitive to changes in market interest rates[215]