Core Points - Community West Bancshares and United Security Bancshares are set to merge in an all-stock transaction, with two directors from United Security Bancshares joining the board of Community West Bancshares upon completion of the merger [1][2] - The merger aims to enhance the banking franchise and better serve communities in Central California [2] Company Overview - Community West Bancshares, established in 1979, operates Community West Bank, which provides a range of banking services across Central California [3] - United Security Bancshares, founded in 1987, is the holding company for United Security Bank, offering commercial and personal banking services through 13 branches in various locations [5] Leadership Changes - Jagroop "Jay" Gill, the largest shareholder and Vice Chairman of United Security Bancshares, is expected to be appointed Vice Chairman of Community West Bancshares' board [1]

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FRESNO, Calif.--(BUSINESS WIRE)--On December 16, 2025, the Board of Directors of United Security Bancshares (the "Company†) (NASDAQ: UBFO), the parent company of United Security Bank (the "Bank†), declared a regular quarterly cash dividend of $0.12 per share on the Company's common stock. The dividend is payable on January 13, 2026, to shareholders of record as of December 26, 2025. About United Security Bancshares United Security Bancshares (NASDAQ: UBFO) is the holding company for United Secu. ...

NEW YORK, Dec. 17, 2025 /PRNewswire/ -- Class Action Attorney Juan Monteverde with Monteverde & Associates PC (the "M&A Class Action Firm"), has recovered millions of dollars for shareholders and is recognized as a Top 50 Firm in the 2024 ISS Securities Class Action Services Report. The firm is headquartered at the Empire State Building in New York City and is investigating United Security Bancshares (NASDAQ: UBFO) related to its sale to Community West Bancshares. Under the terms of the proposed transaction ...

NEW YORK--(BUSINESS WIRE)--Halper Sadeh LLC, an investor rights law firm, is investigating whether the sale of United Security Bancshares (NASDAQ: UBFO) to Community West Bancshares for 0.4520 shares of Community West common stock for each share of United Security common stock is fair to United Security shareholders. Halper Sadeh encourages United Security shareholders to click here to learn more about their legal rights and options or contact Daniel Sadeh or Zachary Halper at (212) 763-0060 or sadeh@halpe ...

MILWAUKEE, Dec. 17, 2025 /PRNewswire/ -- The Ademi Firm is investigating United Security Bancshares (Nasdaq: UBFO) for possible breaches of fiduciary duty and other violations of law in its recently announced transaction with Community West Bancshares. Click here to learn how to join our investigation and obtain additional information or contact us at [email protected] or toll-free: 866-264-3995. There is no cost or obligation to you. In the transaction, United Security Bancshares shareholders will receive ...

FRESNO, Calif.--(BUSINESS WIRE)--Community West Bancshares (NASDAQ: CWBC), Fresno, California, parent company of Community West Bank and United Security Bancshares (NASDAQ: UBFO), parent company of United Security Bank, Fresno, California, announced today that they had signed a definitive merger agreement pursuant to which the companies will combine in an all-stock merger transaction. Following the merger of United Security Bancshares with and into Community West Bancshares, United Security Ban. ...

Financial Performance - Net income for Q3 2025 rose 5.07% to $4.0 million, compared to $3.8 million in Q3 2024[134] - Year-to-date net income for the nine months ended September 30, 2025, was $8.9 million, down from $12.3 million for the same period in 2024[140] - Noninterest income fell 20.02% to $1.6 million in Q3 2025, down from $2.0 million in Q3 2024, primarily due to a decrease in fair value gains on junior subordinated debentures[134] - Noninterest income for the nine months ended September 30, 2025, decreased by $852,000 to $3.7 million compared to the same period in 2024[158] Loan and Deposit Growth - Total loans increased 3.22% to $958.3 million as of September 30, 2025, from $928.5 million at December 31, 2024[134] - Total deposits grew 1.73% to $1.08 billion as of September 30, 2025, compared to $1.06 billion at December 31, 2024[134] - Total loans outstanding at the end of the period were $958.3 million at September 30, 2025, down from $975.2 million at September 30, 2024[207] - Total deposits reached $1.08 billion at September 30, 2025, marking an increase of $18.3 million, or 1.73%, from December 31, 2024[178] Interest Income and Margin - Net interest margin increased to 4.35% for Q3 2025, up from 4.20% in Q3 2024[134] - Total interest income decreased by $129,000, or 0.82%, for the three months ended September 30, 2025, compared to the same period in 2024[150] - The net interest margin for the three months ended September 30, 2025, was 4.35%, compared to 4.20% for the same period in 2024[142] - The Company's net interest margin increased to 4.42% for the nine months ended September 30, 2025, compared to 4.27% for the same period in 2024[154] Expenses and Efficiency - Noninterest expense increased 4.09% to $7.4 million in Q3 2025, compared to $7.1 million in Q3 2024, driven by higher technology and employee benefit expenses[134] - Salaries and employee benefits increased by $977,000, or 9.38%, for the nine months ended September 30, 2025, compared to the same period in 2024[160] - Data processing expenses increased by 57.22% to $1.22 million for the nine months ended September 30, 2025, compared to the same period in 2024[160] Asset Quality - Total nonperforming assets decreased by $3.1 million, or 18.03%, from $17,201,000 to $14,106,000[195] - Nonaccrual loans decreased by $6.5 million, or 53.31%, from $12,198,000 to $5,699,000[196] - The allowance for credit losses to nonperforming loans increased to 259.59% as of September 30, 2025, from 127.16% on December 31, 2024[195] - The allowance for credit losses was 1.69% of total loans at September 30, 2025, unchanged from September 30, 2024[208] Capital and Dividends - The Bank's Tier 1 Leverage Ratio was 12.11% at September 30, 2025, compared to 12.35% at the same date in 2024[216] - The Company and the Bank meet all capital adequacy requirements and are expected to continue doing so for the foreseeable future[219] - The Holding Company has authorized a stock repurchase of up to $3.0 million, representing 2.18% of total shareholders' equity of $137.4 million[221] - A cash dividend of $0.12 per share was declared on September 23, 2025, totaling approximately $2.1 million transferred from retained earnings[223]

Core Viewpoint - United Security Bancshares demonstrated a positive earnings response for Q3 2025, with a notable increase in net income and net interest margin, despite some declines in total interest income and noninterest income [1][3][4]. Financial Performance - Earnings per share (EPS) for Q3 2025 was reported at 23 cents, an increase from 22 cents in the same quarter last year [2]. - Total interest income slightly declined by 0.8% to $15.6 million from $15.8 million year-over-year, while net interest income rose by 5.1% to $12.4 million, up from $11.8 million [3]. - Net income increased by 5.1% to $4 million from $3.8 million in the prior year [3]. Key Business Metrics - Net interest margin improved to 4.35% from 4.20% year-over-year, driven by reduced costs of deposits and short-term borrowings [4]. - The cost of funds decreased to 1.1% from 1.4%, contributing to improved profitability [4]. - Return on average assets (ROAA) rose to 1.3% from 1.2%, and return on average equity (ROAE) increased to 11.7% from 11.6% [4]. Income Sources - Loan interest and fees fell by 0.9% year-over-year to $14.3 million, while noninterest income decreased by 20% to $1.6 million, primarily due to lower gains from fair value adjustments of junior subordinated debentures [5]. - Non-interest expenses increased by 4.1% to $7.4 million, reflecting higher technology, salary, and benefits costs [5]. Management Insights - The CEO expressed optimism regarding loan growth and the bank's equity position, noting a $7 million increase in shareholder equity after dividends [6]. - A decrease in student loan charge-offs was observed, indicating an improving credit environment [6]. Performance Drivers - Quarterly profitability improvements were attributed to lower short-term borrowing costs and a reduction in credit loss provisions, which fell to $1 million from $1.6 million year-over-year [7]. - A $0.2 million gain from a $3 million partial redemption of TruPS contributed positively to noninterest income [7]. Broader Developments - Net interest income benefited from increased earnings from overnight investments at the Federal Reserve and reduced funding costs [8]. - Average loan rates dipped slightly to 5.92% from 6.04%, but this was offset by a decrease in liability costs [8]. Other Notable Events - The company completed a $3 million partial redemption of its TruPS, reducing the contractual balance to $9 million [9]. - A cash dividend of 12 cents per share was declared, payable on October 21, 2025 [9]. - Other real estate owned (OREO) increased to $7.9 million from $4.6 million at year-end 2024, mainly due to foreclosures, although total nonperforming assets decreased to $14.1 million from $17.2 million [10].

Executive Summary & Highlights [3rd Quarter 2025 Financial Results Overview](index=1&type=section&id=3rd%20Quarter%202025%20Financial%20Results%20Overview) United Security Bancshares reported increased net income and EPS for Q3 2025 compared to Q3 2024, driven by strong loan growth and improved shareholders' equity, despite ongoing student loan charge-offs which decreased in magnitude this quarter Q3 2025 Financial Results Summary | Metric | Q3 2025 | Q3 2024 | Change | % Change | | :-------------------------------- | :------ | :------ | :------ | :------- | | Net Income | **$4.0 million** | **$3.8 million** | **+$0.2 million** | **+5.26%** | | Basic and Diluted EPS | **$0.23** | **$0.22** | **+$0.01** | **+4.55%** | - Loan growth of **$30.0 million** this quarter compared to the end of 2024[3](index=3&type=chunk) - Shareholders' equity improved by **$7.0 million** after dividends[3](index=3&type=chunk) - Magnitude of charge-offs in the student loan portfolio decreased this quarter compared to past few quarters[3](index=3&type=chunk) [Third Quarter 2025 Key Financial Highlights](index=1&type=section&id=Third%20Quarter%202025%20Key%20Financial%20Highlights) Key financial metrics for Q3 2025 showed improvements in net interest margin, return on assets, and return on equity, alongside decreases in the cost of deposits and interest expense. Total loans and deposits also increased Q3 2025 Key Financial Highlights Table | Metric | Q3 2025 | Q3 2024 | Change | | :----------------------------------- | :------ | :------ | :------- | | Net Interest Margin | **4.35%** | **4.20%** | **+0.15%** | | Annualized Average Cost of Deposits | **1.12%** | **1.18%** | **-0.06%** | | Net Income | **$4.0 million** | **$3.8 million** | **+5.07%** | | Loan Interest and Fees | **$14.3 million** | **$14.4 million** | **-0.94%** | | Interest Income | **$15.6 million** | **$15.8 million** | **-0.82%** | | Interest Expense | **$3.2 million** | **$3.9 million** | **-18.67%** | | Noninterest Income | **$1.6 million** | **$2.0 million** | **-20.02%** | | Provision for Credit Losses | **$948,000** | **$1.6 million** | **-$652,000** | | Noninterest Expense | **$7.4 million** | **$7.1 million** | **+4.09%** | | Annualized Return on Average Assets (ROAA) | **1.29%** | **1.24%** | **+0.05%** | | Annualized Return on Average Equity (ROAE) | **11.68%** | **11.63%** | **+0.05%** | | Total Loans, net of unearned fees | **$958.3 million** | **$928.5 million** (Dec 31, 2024) | **+3.22%** | | Total Deposits | **$1.08 billion** | **$1.06 billion** (Dec 31, 2024) | **+1.73%** | - Partial redemption of **$3.0 million** on Junior Subordinated Debentures (TruPS) on July 1, 2025, resulting in a gain of **$241,000**[3](index=3&type=chunk) Results of Operations [Quarter Ended September 30, 2025](index=2&type=section&id=Quarter%20Ended%20September%2030,%202025) For the third quarter of 2025, the Company reported an increase in net income and improved profitability ratios compared to the prior year, primarily driven by a decrease in the provision for credit losses and reduced short-term borrowing expenses, despite higher noninterest expenses and income tax provision [Net Income and Profitability Ratios (Q3 2025)](index=2&type=section&id=Net%20Income%20and%20Profitability%20Ratios%20(Q3%202025)) Net Income and Profitability Ratios Data | Metric | Q3 2025 | Q3 2024 | Q2 2025 | YoY Change | QoQ Change | | :-------------------------------- | :------ | :------ | :------ | :--------- | :--------- | | Net Income | **$4.0 million** | **$3.8 million** | **$2.2 million** | **+5.07%** | **+81.82%** | | Basic and Diluted EPS | **$0.23** | **$0.22** | **$0.13** | **+$0.01** | **+$0.10** | | ROAE | **11.68%** | **11.63%** | - | **+0.05%** | - | | ROAA | **1.29%** | **1.24%** | - | **+0.05%** | - | - The increase in net income was primarily due to a **$610,000** decrease in the provision for credit losses and a **$717,000** decrease in short-term borrowing expense, partially offset by increases in noninterest expense (**$292,000**) and income tax provision (**$326,000**), and a decrease in loan and fee income (**$135,000**)[4](index=4&type=chunk) - A gain of **$241,000** related to the partial redemption of TruPS and a **$6,000** gain from changes in fair value of TruPS also contributed to the income increase[4](index=4&type=chunk) [Net Interest Income and Margin (Q3 2025)](index=2&type=section&id=Net%20Interest%20Income%20and%20Margin%20(Q3%202025)) Net Interest Income and Margin Data | Metric | Q3 2025 | Q3 2024 | YoY Change | Q2 2025 | QoQ Change | | :----------------------------------- | :------ | :------ | :--------- | :------ | :--------- | | Net Interest Income (before provision) | **$12.4 million** | **$11.8 million** | **+5.14%** | **$11.9 million** | **+$556,000** | | Net Interest Margin | **4.35%** | **4.20%** | **+0.15%** | - | - | | Annualized Average Cost of Deposits | **1.12%** | **1.18%** | **-0.06%** | - | - | | Annualized Average Cost of Funds | **1.13%** | **1.38%** | **-0.25%** | - | - | - The increase in net interest income was driven by increases in interest on overnight investments held at the Federal Reserve and decreases in interest expense on short-term borrowings and deposits, offset by decreases in loan-interest income and investment securities interest income[6](index=6&type=chunk) - Yields on interest-earning assets decreased from **5.60%** to **5.47%**, while the cost of interest-bearing liabilities decreased from **2.13%** to **1.81%**[6](index=6&type=chunk) [Noninterest Income (Q3 2025)](index=2&type=section&id=Noninterest%20Income%20(Q3%202025)) Noninterest Income Data | Metric | Q3 2025 | Q3 2024 | YoY Change | Q2 2025 | QoQ Change | | :----------------------------------- | :------ | :------ | :--------- | :------ | :--------- | | Total Noninterest Income | **$1.6 million** | **$2.0 million** | **-$405,000** | **$758,000** | **+$860,000** | | Gain on fair value of TruPS | **$247,000** | **$661,000** | **-$414,000** | **-$317,000** (loss) | **+$564,000** | - The decrease in noninterest income YoY was primarily due to a lower gain on the fair value of TruPS, while the QoQ increase was due to a shift from a loss to a gain on TruPS and an increase in customer service fees of **$121,000**[7](index=7&type=chunk) - Noninterest income for Q3 2025 also included a realized gain of **$241,000** from the partial redemption of **$3.0 million** of TruPS[7](index=7&type=chunk) [Noninterest Expense (Q3 2025)](index=2&type=section&id=Noninterest%20Expense%20(Q3%202025)) Noninterest Expense Data | Metric | Q3 2025 | Q3 2024 | YoY Change | Q2 2025 | QoQ Change | | :-------------------- | :------ | :------ | :--------- | :------ | :--------- | | Total Noninterest Expense | **$7.4 million** | **$7.1 million** | **+$292,000** | **$7.7 million** | **-$305,000** | - The YoY increase was partially due to increases of **$125,000** in other noninterest expense and **$93,000** in salaries and employee benefit expenses, offset by decreases in loan-related expenses of **$95,000**[8](index=8&type=chunk) - Salaries and employee benefits increased primarily due to increases of **$144,000** in employee salary expense and **$101,000** in group insurance costs[8](index=8&type=chunk) [Provision for Credit Losses (Q3 2025)](index=1&type=section&id=Provision%20for%20Credit%20Losses%20(Q3%202025)) Provision for Credit Losses Data | Metric | Q3 2025 | Q3 2024 | Change | | :-------------------------- | :------ | :------ | :------- | | Provision for Credit Losses | **$948,000** | **$1.6 million** | **-$652,000** | - The decreased credit provision was due to a decrease in charge-offs within the student loan portfolio[3](index=3&type=chunk) [Efficiency Ratio and Income Tax (Q3 2025)](index=3&type=section&id=Efficiency%20Ratio%20and%20Income%20Tax%20(Q3%202025)) Efficiency Ratio and Income Tax Data | Metric | Q3 2025 | Q3 2024 | Change | | :-------------------- | :------ | :------ | :------- | | Efficiency Ratio | **52.80%** | **52.47%** | **+0.33%** | | Income Tax Provision | **$1.6 million** | **$1.3 million** | **+$300,000** | | Effective Tax Rate | **28.86%** | **25.43%** | **+3.43%** | - The deterioration in the efficiency ratio was due to an increase in noninterest expense and a decrease in noninterest income, offset by an increase in net interest income[9](index=9&type=chunk) [Nine Months Ended September 30, 2025](index=3&type=section&id=Nine%20Months%20Ended%20September%2030,%202025) For the nine months ended September 30, 2025, net income decreased significantly compared to the prior year, primarily due to a substantial increase in the provision for credit losses, higher deposit interest expense, and increased noninterest expense, which outweighed reductions in short-term borrowing expense and income tax provision [Net Income and Profitability Ratios (9M 2025)](index=3&type=section&id=Net%20Income%20and%20Profitability%20Ratios%20(9M%202025)) Net Income and Profitability Ratios Data | Metric | 9M 2025 | 9M 2024 | Change | % Change | | :-------------------------------- | :------ | :------ | :------ | :------- | | Net Income | **$8.9 million** | **$12.3 million** | **-$3.4 million** | **-27.78%** | | Basic and Diluted EPS | **$0.51** | **$0.72** | **-$0.21** | **-29.17%** | | ROAE | **8.79%** | **12.95%** | **-4.16%** | - | | ROAA | **0.98%** | **1.36%** | **-0.38%** | - | - The decrease in net income was primarily the result of a **$3.4 million** increase in the provision for credit losses, a **$2.0 million** increase in deposit interest expense, and a **$1.9 million** increase in noninterest expense[11](index=11&type=chunk) - These negative impacts were partially offset by a **$3.3 million** decrease in short-term borrowing expense, a **$1.2 million** decrease in the income tax provision, an increase of **$59,000** on the fair value of TruPS, and an increase of **$516,000** in loan and fee income[11](index=11&type=chunk) [Net Interest Income and Margin (9M 2025)](index=3&type=section&id=Net%20Interest%20Income%20and%20Margin%20(9M%202025)) Net Interest Income and Margin Data | Metric | 9M 2025 | 9M 2024 | Change | % Change | | :----------------------------------- | :------ | :------ | :------ | :------- | | Net Interest Income (before provision) | **$36.6 million** | **$35.0 million** | **+$1.5 million** | **+4.37%** | | Net Interest Margin | **4.42%** | **4.27%** | **+0.15%** | - | | Annualized Average Cost of Deposits | **1.11%** | **0.91%** | **+0.20%** | - | | Annualized Average Cost of Funds | **1.12%** | **1.25%** | **-0.13%** | - | - The increase in net interest income was driven by increases in loan-interest income, increases in income on overnight deposits held at the Federal Reserve, and decreases in interest expense on short-term borrowings, offset by increases in interest expense on deposits[13](index=13&type=chunk) - Yields on interest-earning assets decreased slightly to **5.55%** from **5.56%**, while yields on interest-bearing liabilities decreased to **1.78%** from **1.97%**[13](index=13&type=chunk) [Noninterest Income (9M 2025)](index=3&type=section&id=Noninterest%20Income%20(9M%202025)) Noninterest Income Data | Metric | 9M 2025 | 9M 2024 | Change | | :-------------------- | :------ | :------ | :------- | | Total Noninterest Income | **$3.7 million** | **$4.6 million** | **-$852,000** | | Gain on fair value of TruPS | **$200,000** | **$141,000** | **+$59,000** | - The decrease in noninterest income was partially due to a **$573,000** gain on proceeds from life insurance realized during the nine months ended September 30, 2024, and a decrease in other noninterest income of **$342,000**[14](index=14&type=chunk) - Noninterest income also included a realized gain of **$241,000** related to the partial redemption of **$3.0 million** of the TruPS contractual balance[14](index=14&type=chunk) [Noninterest Expense (9M 2025)](index=3&type=section&id=Noninterest%20Expense%20(9M%202025)) Noninterest Expense Data | Metric | 9M 2025 | 9M 2024 | Change | | :-------------------- | :------ | :------ | :------- | | Total Noninterest Expense | **$22.8 million** | **$20.8 million** | **+$1.9 million** | - The increase was partially from increases of **$1.0 million** in salaries and employee benefit expenses, **$444,000** in data processing expenses, and **$323,000** in other noninterest expense[15](index=15&type=chunk) - Salaries and employee benefits increased primarily due to increases of **$554,000** in group insurance costs and **$342,000** in employee salaries[15](index=15&type=chunk) [Provision for Credit Losses (9M 2025)](index=4&type=section&id=Provision%20for%20Credit%20Losses%20(9M%202025)) Provision for Credit Losses Data | Metric | 9M 2025 | 9M 2024 | Change | | :-------------------------- | :------ | :------ | :------- | | Provision for Credit Losses | **$5.1 million** | **$1.8 million** | **+$3.3 million** | - The provisions recorded during 2025 and 2024 were primarily driven by deterioration within the student loan portfolio[22](index=22&type=chunk) [Efficiency Ratio and Income Tax (9M 2025)](index=3&type=section&id=Efficiency%20Ratio%20and%20Income%20Tax%20(9M%202025)) Efficiency Ratio and Income Tax Data | Metric | 9M 2025 | 9M 2024 | Change | | :-------------------- | :------ | :------ | :------- | | Efficiency Ratio | **56.36%** | **52.96%** | **+3.40%** | | Income Tax Provision | **$3.6 million** | **$4.8 million** | **-$1.2 million** | | Effective Tax Rate | **28.61%** | **27.88%** | **+0.73%** | - The deterioration in the efficiency ratio was due to increases in interest expense and noninterest expense and a decrease in noninterest income, offset by an increase in net interest income[16](index=16&type=chunk) Balance Sheet Review [Assets Review](index=4&type=section&id=Assets%20Review) Total assets increased by 1.97% since December 31, 2024, primarily driven by growth in gross loan balances, particularly real estate construction and agricultural loans, while investment securities decreased and OREO balances rose due to foreclosures Asset Categories Overview | Asset Category | Sep 30, 2025 | Dec 31, 2024 | Change | % Change | | :----------------------------------- | :----------- | :----------- | :------- | :------- | | Total Assets | **$1.236 billion** | **$1.212 billion** | **+$23.9 million** | **+1.97%** | | Gross Loan Balances | **+$30.1 million** | - | - | - | | Investment Securities | **-$16.4 million** | - | - | - | | Total Cash and Cash Equivalents | **+$10.6 million** | - | - | - | | OREO Balances | **$7.9 million** | **$4.6 million** | **+$3.3 million** | **+71.74%** | - Increases in gross loans included **$31.4 million** in real estate construction and development loans and **$22.7 million** in agricultural loans, offset by decreases in commercial and industrial loans and installment loans[18](index=18&type=chunk) - Declines in the investment portfolio were primarily due to calls on and maturities of corporate securities, partially offset by a decrease in unrealized losses[18](index=18&type=chunk) [Liabilities and Deposits Review](index=4&type=section&id=Liabilities%20and%20Deposits%20Review) Total deposits increased by 1.73% since December 31, 2024, driven by a significant rise in noninterest-bearing deposits, which offset a decrease in interest-bearing deposits. Core deposits also saw an increase Liabilities and Deposits Overview | Deposit Category | Sep 30, 2025 | Dec 31, 2024 | Change | % Change | | :----------------------- | :----------- | :----------- | :------- | :------- | | Total Deposits | **$1.08 billion** | **$1.06 billion** | **+$18.3 million** | **+1.73%** | | Noninterest-bearing Deposits | **$384.4 million** | **$360.2 million** | **+$24.2 million** | **+6.72%** | | Interest-bearing Deposits | **-$5.9 million** | - | - | - | | Core Deposits | **+$18.9 million** | - | - | - | - Brokered DDA accounts totaled **$100.3 million** at both September 30, 2025, and December 31, 2024, with an average rate of **4.53%** for Q3 2025[19](index=19&type=chunk) [Shareholders' Equity and Dividends](index=4&type=section&id=Shareholders'%20Equity%20and%20Dividends) Shareholders' equity increased by $7.0 million since December 31, 2024, primarily due to net income and a reduction in accumulated other comprehensive loss, partially offset by dividend payments. The Board declared a cash dividend of $0.12 per share Shareholders' Equity and Dividends Data | Metric | Sep 30, 2025 | Dec 31, 2024 | Change | | :----------------------------------- | :----------- | :----------- | :------- | | Total Shareholders' Equity | **$137.4 million** | **$130.4 million** | **+$7.0 million** | | Accumulated Other Comprehensive Loss | **$10.6 million** | **$14.4 million** | **-$3.8 million** | - The increase in equity was the result of **$8.9 million** in net income and a **$3.8 million** decrease in accumulated other comprehensive loss, partially offset by **$6.3 million** in dividend payments[20](index=20&type=chunk) - A cash dividend of **$0.12** per share was declared on September 23, 2025, payable on October 21, 2025[21](index=21&type=chunk) Credit Quality [Provision for Credit Losses and Net Charge-offs](index=4&type=section&id=Provision%20for%20Credit%20Losses%20and%20Net%20Charge-offs) The Company recorded a significantly higher provision for credit losses and net loan charge-offs for the nine months ended September 30, 2025, compared to the prior year, primarily due to deterioration within the student loan portfolio Credit Losses and Net Charge-offs Data | Metric | 9M 2025 | 9M 2024 | Change | | :-------------------------- | :------ | :------ | :------- | | Provision for Credit Losses | **$5.1 million** | **$1.8 million** | **+$3.3 million** | | Net Loan Charge-offs | **$4.6 million** | **$1.2 million** | **+$3.4 million** | - The provisions and charge-offs were primarily driven by deterioration within the student loan portfolio[22](index=22&type=chunk) [Allowance for Credit Losses](index=4&type=section&id=Allowance%20for%20Credit%20Losses) The allowance for credit losses as a percentage of the loan portfolio slightly decreased, but management deems it adequate to cover potential losses Allowance for Credit Losses Data | Metric | Sep 30, 2025 | Dec 31, 2024 | Change | | :-------------------------------- | :----------- | :----------- | :------- | | Allowance for Credit Losses to Loan Portfolio | **1.69%** | **1.72%** | **-0.03%** | - Management considers the allowance for credit losses at September 30, 2025, to be adequate[23](index=23&type=chunk) [Non-performing Assets](index=5&type=section&id=Non-performing%20Assets) Non-performing assets decreased by $3.1 million, or 18.08%, since December 31, 2024, primarily due to a significant reduction in nonaccrual loans, partially offset by an increase in Other Real Estate Owned (OREO) from foreclosures Non-performing Assets Data | Metric | Sep 30, 2025 | Dec 31, 2024 | Change | % Change | | :-------------------------------- | :----------- | :----------- | :------- | :------- | | Total Non-performing Assets | **$14.1 million** | **$17.2 million** | **-$3.1 million** | **-18.08%** | | Non-performing Assets to Total Assets | **1.14%** | **1.42%** | **-0.28%** | - | | Nonaccrual Loans | **-$6.5 million** | - | - | - | | OREO Balances | **+$3.3 million** | - | - | - | - The decrease in non-performing assets is primarily attributed to a decrease of **$6.5 million** in nonaccrual loans, partially offset by an increase of **$3.3 million** in OREO balances due to foreclosures[24](index=24&type=chunk) - A nonaccrual loan with a principal balance of **$3.2 million** was paid off, and nonaccrual interest of **$890,000** was recognized[24](index=24&type=chunk) Company Information [About United Security Bancshares](index=5&type=section&id=About%20United%20Security%20Bancshares) United Security Bancshares is the holding company for United Security Bank, established in 1987 and headquartered in Fresno, CA. It operates 13 full-service branch offices across various California cities and includes Commercial Real Estate Construction, Commercial Lending, and Consumer Lending departments - United Security Bancshares (NASDAQ: **UBFO**) is the holding company for United Security Bank, founded in **1987**[25](index=25&type=chunk) - Headquartered in Fresno, CA, with **13** full-service branch offices in various California locations[25](index=25&type=chunk) - Operates Commercial Real Estate Construction, Commercial Lending, and Consumer Lending departments[25](index=25&type=chunk) Forward-Looking Statements [Disclaimer and Risk Factors](index=5&type=section&id=Disclaimer%20and%20Risk%20Factors) This section contains forward-looking statements that are subject to various risks and uncertainties, which could cause actual results to differ materially from expectations. Readers are advised not to place undue reliance on these statements and to review the Company's Form 10-K for a comprehensive discussion of risks - Forward-looking statements are based on management's current knowledge and beliefs and are not guarantees of future performance[26](index=26&type=chunk) - Actual results may differ materially due to various factors, including adverse economic conditions, geopolitical developments, regulatory changes, increased competition, credit quality, technological changes, and liquidity risks[27](index=27&type=chunk) - The Company does not undertake any obligation to publicly revise or update these statements, except as required by law, and directs readers to its Annual Report on Form 10-K for a more complete discussion of risks[29](index=29&type=chunk) Financial Statements & Data [Consolidated Balance Sheets (unaudited)](index=6&type=section&id=Consolidated%20Balance%20Sheets) The unaudited consolidated balance sheets present the Company's financial position as of September 30, 2025, and December 31, 2024, detailing assets, liabilities, and shareholders' equity Consolidated Balance Sheet Summary | (In thousands) | Sep 30, 2025 | Dec 31, 2024 | | :------------------------------------------ | :----------- | :----------- | | **Assets** | | | | Cash and cash equivalents | **$66,767** | **$56,211** | | Total investment securities | **144,342** | **160,708** | | Net loans | **942,113** | **912,416** | | Total assets | **$1,235,620** | **$1,211,718** | | **Liabilities and Shareholders' Equity** | | | | Total deposits | **1,075,900** | **1,057,622** | | Junior subordinated debentures (TruPS) | **9,145** | **11,572** | | Total liabilities | **1,098,238** | **1,081,356** | | Total shareholders' equity | **137,382** | **130,362** | | Total liabilities and shareholders' equity | **$1,235,620** | **$1,211,718** | [Consolidated Statements of Income (unaudited)](index=7&type=section&id=Consolidated%20Statements%20of%20Income) The unaudited consolidated statements of income provide a detailed breakdown of the Company's revenues and expenses for the three and nine months ended September 30, 2025, and 2024, showing net interest income, noninterest income/expense, and net income Consolidated Statements of Income Summary | (In thousands) | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | | :------------------------------------------ | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Total interest income | **$15,626** | **$15,755** | **$45,913** | **$45,605** | | Total interest expense | **3,207** | **3,943** | **9,337** | **10,559** | | Net Interest Income | **12,419** | **11,812** | **36,576** | **35,046** | | Provision for Credit Losses | **948** | **1,558** | **5,106** | **1,750** | | Total noninterest income | **1,618** | **2,023** | **3,739** | **4,591** | | Total noninterest expense | **7,434** | **7,142** | **22,778** | **20,849** | | Income Before Provision for Taxes | **5,655** | **5,135** | **12,431** | **17,038** | | Provision for Income Taxes | **1,632** | **1,306** | **3,557** | **4,751** | | Net Income | **$4,023** | **$3,829** | **$8,874** | **$12,287** | | Basic Net income per common share | **$0.23** | **$0.22** | **$0.51** | **$0.72** | | Diluted Net income per common share | **$0.23** | **$0.22** | **$0.51** | **$0.72** | [Average Balances and Rates (unaudited)](index=8&type=section&id=Average%20Balances%20and%20Rates) This table provides unaudited average balances for key assets and liabilities, along with the corresponding average interest rates, for the three and nine months ended September 30, 2025, and 2024, illustrating trends in interest-earning assets and interest-bearing liabilities Average Balances and Rates Data | (In thousands) | Three Months Ended Sep 30, 2025 | Three Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2025 | Nine Months Ended Sep 30, 2024 | | :----------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | **Average Balances:** | | | | | | Loans | **$956,832** | **$949,207** | **$935,727** | **$921,454** | | Total interest-earning assets | **1,133,053** | **1,120,080** | **1,106,485** | **1,096,012** | | Total average assets | **$1,238,187** | **$1,231,282** | **$1,212,524** | **$1,206,657** | | Interest-bearing deposits | **$689,444** | **$678,334** | **$683,802** | **$624,699** | | Total interest-bearing liabilities | **701,272** | **735,502** | **699,661** | **714,580** | | Total equity | **136,703** | **130,929** | **135,007** | **126,757** | | **Average Rates:** | | | | | | Loans | **5.92%** | **6.04%** | **6.00%** | **6.01%** | | Total earning assets | **5.47%** | **5.60%** | **5.55%** | **5.56%** | | Interest-bearing deposits | **1.75%** | **1.80%** | **1.70%** | **1.42%** | | Total interest-bearing liabilities | **1.81%** | **2.13%** | **1.78%** | **1.97%** | | Net interest margin | **4.35%** | **4.20%** | **4.42%** | **4.27%** | [Condensed Consolidated Financials (unaudited)](index=9&type=section&id=Condensed%20Consolidated%20Financials) These condensed unaudited consolidated financial statements provide a quarterly view of the Company's balance sheet and income statement trends, allowing for sequential analysis of financial performance and position over recent periods Condensed Consolidated Financials Summary | (In thousands) | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | | :------------------------------------------ | :----------- | :----------- | :----------- | :----------- | :----------- | | **Condensed - Consolidated Balance Sheets** | | | | | | | Total assets | **$1,235,620** | **$1,214,137** | **$1,191,791** | **$1,211,718** | **$1,255,376** | | Total deposits | **1,075,900** | **1,055,669** | **1,026,213** | **1,057,622** | **1,065,021** | | Total shareholders' equity | **137,382** | **134,254** | **132,876** | **130,362** | **132,856** | | **Condensed - Consolidated Statements of Income** | | | | | | | Total interest income | **$15,626** | **$15,004** | **$15,283** | **$15,146** | **$15,755** | | Net interest income | **12,419** | **11,863** | **12,296** | **11,804** | **11,812** | | Provision for credit losses | **948** | **1,858** | **2,300** | **1,213** | **1,558** | | Net income | **$4,023** | **$2,169** | **$2,682** | **$2,495** | **$3,829** | [Nonperforming Assets (unaudited)](index=10&type=section&id=Nonperforming%20Assets%20Data) This table provides a breakdown of nonperforming assets, including nonaccrual loans and other real estate owned, along with key ratios, as of September 30, 2025, and December 31, 2024 Nonperforming Assets Breakdown | (Dollars in thousands) | Sep 30, 2025 | Dec 31, 2024 | | :-------------------------------- | :----------- | :----------- | | Total nonaccrual loans | **$5,699** | **$12,198** | | Loans past due 90 days and still accruing | **555** | **421** | | Total nonperforming loans | **6,254** | **12,619** | | Other real estate owned | **7,852** | **4,582** | | Total nonperforming assets | **$14,106** | **$17,201** | | Nonperforming loans to total gross loans | **0.65%** | **1.36%** | | Nonperforming assets to total assets | **1.14%** | **1.42%** | | Allowance for credit losses to nonperforming loans | **259.59%** | **127.16%** | [Selected Financial Data (unaudited)](index=10&type=section&id=Selected%20Financial%20Data) This table presents key financial performance and balance sheet ratios, including profitability, efficiency, credit quality, and per-share metrics, for the three and nine months ended September 30, 2025, and 2024, and period-end data Selected Financial Data Table | Metric | Three months ended Sep 30, 2025 | Three months ended Sep 30, 2024 | Nine months ended Sep 30, 2025 | Nine months ended Sep 30, 2024 | | :----------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Return on average assets | **1.29%** | **1.24%** | **0.98%** | **1.36%** | | Return on average equity | **11.68%** | **11.63%** | **8.79%** | **12.95%** | | Efficiency ratio | **52.80%** | **52.47%** | **56.36%** | **52.96%** | | Annualized net charge-offs to average loans | **0.26%** | **0.27%** | **0.66%** | **0.18%** | | | Sep 30, 2025 | Dec 31, 2024 | | | | Shares outstanding - period end | **17,557,427** | **17,364,894** | | | | Book value per share | **$7.82** | **$7.51** | | | | Tangible book value per share | **$7.57** | **$7.25** | | | | Loan-to-deposit ratio | **89.07%** | **87.79%** | | | | Allowance for credit losses to total loans | **1.69%** | **1.72%** | | | | Tier 1 capital to adjusted average assets (Company) | **12.42%** | **12.57%** | | |