[Financial Highlights and Corporate Actions](index=1&type=section&id=Financial%20Highlights%20and%20Corporate%20Actions) [First Quarter 2025 Financial Results](index=1&type=section&id=First%20Quarter%202025%20Financial%20Results) Western New England Bancorp, Inc. reported a net income of $2.3 million, or $0.11 per diluted share, for the first quarter of 2025, a decrease from prior quarters Q1 2025 Earnings Summary | Metric | Q1 2025 | Q4 2024 | Q1 2024 | | :--- | :--- | :--- | :--- | | Net Income | $2.3M | $3.3M | $3.0M | | Diluted EPS | $0.11 | $0.16 | $0.14 | [Dividend Declaration](index=1&type=section&id=Dividend%20Declaration) The Board of Directors declared a quarterly cash dividend of $0.07 per share, payable on or about May 21, 2025, to shareholders of record on May 7, 2025 - A quarterly cash dividend of **$0.07** per share was declared[2](index=2&type=chunk) [Share Repurchase Plan](index=1&type=section&id=Share%20Repurchase%20Plan) The Company announced a new stock repurchase plan for 2025, authorizing the repurchase of up to 1.0 million shares, commencing after the existing 2024 plan's completion - The Board of Directors authorized a new stock repurchase plan (the "2025 Plan") to repurchase up to **1.0 million** shares, representing approximately **4.8%** of outstanding common stock[3](index=3&type=chunk)[14](index=14&type=chunk) - The 2025 Plan will begin after the current 2024 Plan is completed. As of March 31, 2025, **265,609** shares were still available for repurchase under the 2024 Plan[3](index=3&type=chunk)[13](index=13&type=chunk) - During Q1 2025, the Company repurchased **206,709** shares under the 2024 Plan at an average price of **$9.12** per share[13](index=13&type=chunk) [Management Commentary and Strategic Highlights](index=1&type=section&id=Management%20Commentary%20and%20Strategic%20Highlights) [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO James C. Hagan highlighted the third consecutive quarterly increase in net interest income, driven by disciplined funding costs and strong core deposit growth, while maintaining robust asset quality and a well-capitalized position - Net interest income increased for the third consecutive quarter, with the net interest margin rising by **8 basis points** to **2.49%** compared to the previous quarter[4](index=4&type=chunk) - Core deposits grew by **$70.2 million** (**4.5%**) in Q1, now representing **70.0%** of total deposits, while the loan-to-deposit ratio fell to **89.3%**[4](index=4&type=chunk) - Asset quality remains strong, with nonaccrual loans at **0.29%** of total loans as of March 31, 2025[5](index=5&type=chunk) - The Company is considered well-capitalized and views share buybacks as a valuable use of capital, leading to the announcement of the new 2025 repurchase plan[6](index=6&type=chunk) [Key Operational Highlights](index=2&type=section&id=Key%20Operational%20Highlights) In Q1 2025, total gross loans and deposits increased, strengthening the balance sheet, while the company maintained a strong liquidity position and stable credit quality - Total gross loans increased by **$9.3 million** (**0.4%**) to **$2.1 billion**, driven by residential real estate and commercial/industrial loans[7](index=7&type=chunk) - Total deposits increased by **$66.0 million** (**2.9%**) to **$2.3 billion**, with core deposits growing by **$70.2 million**[8](index=8&type=chunk) - The company has a strong liquidity position with **$1.1 billion** in immediately available liquidity, which is **1.7 times** the amount of its uninsured deposits (**$665.6 million**)[9](index=9&type=chunk) - The allowance for credit losses was **$19.7 million**, or **0.95%** of total loans, with nonaccrual loans at **0.29%** of total loans[11](index=11&type=chunk) [Detailed Financial Performance Analysis](index=4&type=section&id=Detailed%20Financial%20Performance%20Analysis) [Q1 2025 vs. Q4 2024 (Linked Quarter)](index=4&type=section&id=Q1%202025%20vs.%20Q4%202024%20(Linked%20Quarter)) On a linked-quarter basis, net income decreased by 30.0% to $2.3 million, primarily due to increased provision for credit losses, decreased non-interest income, and higher non-interest expense, partially offset by increased net interest income Q1 2025 vs Q4 2024 Performance | Metric | Q1 2025 | Q4 2024 | Change | | :--- | :--- | :--- | :--- | | Net Income | $2.3M | $3.3M | -$1.0M (-30.0%) | | Diluted EPS | $0.11 | $0.16 | -$0.05 | | Net Interest Income | $15.5M | $15.3M | +$0.26M (+1.7%) | | Provision for Credit Losses | $142K | ($762K) | +$904K | | Non-Interest Income | $2.8M | $3.3M | -$0.5M (-15.2%) | | Non-Interest Expense | $15.2M | $14.9M | +$0.26M (+1.7%) | [Net Interest Income and Margin](index=4&type=section&id=Q1%202025%20vs.%20Q4%202024%20-%20Net%20Interest%20Income%20and%20Margin) Net interest income rose by $261,000 (1.7%) to $15.5 million, driven by a decrease in interest expense, and the net interest margin expanded by 8 basis points to 2.49% - Net interest income increased by **$261,000**, primarily due to a decrease in interest expense[18](index=18&type=chunk) - The net interest margin increased by **8 basis points** to **2.49%** (**2.51%** on a tax-equivalent basis)[19](index=19&type=chunk) - The average cost of total funds decreased by **4 basis points** to **2.16%**, mainly due to a **20 basis point** drop in the average cost of time deposits to **4.11%**[21](index=21&type=chunk) [Provision for Credit Losses](index=5&type=section&id=Q1%202025%20vs.%20Q4%202024%20-%20Provision%20for%20Credit%20Losses) The company recorded a provision for credit losses of $142,000 in Q1 2025, a significant shift from the $762,000 reversal in Q4 2024, primarily due to macroeconomic forecast adjustments - A provision of **$142,000** was recorded in Q1 2025, compared to a reversal of **$762,000** in Q4 2024, mainly due to changes in the macroeconomic forecast[22](index=22&type=chunk) - The quarter saw net charge-offs of **$29,000**, compared to net recoveries of **$128,000** in the prior quarter[23](index=23&type=chunk) [Non-Interest Income](index=5&type=section&id=Q1%202025%20vs.%20Q4%202024%20-%20Non-Interest%20Income) Non-interest income fell by $495,000 (15.2%) to $2.8 million, largely due to the absence of gains on non-marketable equity investments and loan-level swap fees present in Q4 2024 - Non-interest income decreased by **$495,000**, primarily because Q4 2024 included a **$300,000** gain on non-marketable equity investments and **$187,000** in loan-level swap fees, which did not recur in Q1 2025[24](index=24&type=chunk) [Non-Interest Expense](index=5&type=section&id=Q1%202025%20vs.%20Q4%202024%20-%20Non-Interest%20Expense) Non-interest expense increased by $258,000 (1.7%) to $15.2 million, driven by higher occupancy costs, advertising, and professional fees, leading to a worsened efficiency ratio - Non-interest expense rose by **$258,000**, with notable increases in occupancy expense (**+$156,000**), advertising (**+$119,000**), and professional fees (**+$75,000**)[25](index=25&type=chunk) - The efficiency ratio worsened to **83.0%** from **80.6%** in the prior quarter, driven by higher expenses and lower non-interest income[26](index=26&type=chunk) [Income Tax Provision](index=6&type=section&id=Q1%202025%20vs.%20Q4%202024%20-%20Income%20Tax%20Provision) Income tax expense for Q1 2025 was $664,000, with an effective tax rate of 22.4%, lower than the $1.1 million expense and 24.6% effective tax rate in Q4 2024 - The effective tax rate decreased to **22.4%** in Q1 2025 from **24.6%** in Q4 2024[27](index=27&type=chunk) [Q1 2025 vs. Q1 2024 (Year-over-Year)](index=6&type=section&id=Q1%202025%20vs.%20Q1%202024%20(Year-over-Year)) Compared to Q1 2024, net income decreased by $700,000 to $2.3 million, as increased provision for credit losses and non-interest expense more than offset growth in net interest income Q1 2025 vs Q1 2024 Performance | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Income | $2.3M | $3.0M | -$0.7M (-23.3%) | | Diluted EPS | $0.11 | $0.14 | -$0.03 | | Net Interest Income | $15.5M | $15.3M | +$0.2M (+1.2%) | | Provision for Credit Losses | $142K | ($550K) | +$692K | | Non-Interest Income | $2.8M | $2.7M | +$85K (+3.2%) | | Non-Interest Expense | $15.2M | $14.8M | +$0.4M (+2.7%) | [Net Interest Income and Margin](index=6&type=section&id=Q1%202025%20vs.%20Q1%202024%20-%20Net%20Interest%20Income%20and%20Margin) Net interest income increased by $188,000 (1.2%) year-over-year, but the net interest margin compressed by 8 basis points to 2.49% due to a faster rise in funding costs than asset yields - Net interest income grew by **$188,000** YoY, but the net interest margin decreased from **2.57%** to **2.49%**[29](index=29&type=chunk) - The average cost of total funds increased by **19 basis points** to **2.16%** YoY, while the average yield on interest-earning assets increased by only **11 basis points** to **4.56%**[30](index=30&type=chunk)[31](index=31&type=chunk) [Provision for Credit Losses](index=6&type=section&id=Q1%202025%20vs.%20Q1%202024%20-%20Provision%20for%20Credit%20Losses) The company recorded a provision for credit losses of $142,000 in Q1 2025, a significant change from the $550,000 reversal in Q1 2024, primarily due to macroeconomic forecast updates - A provision of **$142,000** was recorded in Q1 2025, a significant change from the **$550,000** reversal in Q1 2024, mainly due to macroeconomic forecast updates[32](index=32&type=chunk) - The quarter saw net charge-offs of **$29,000**, compared to net recoveries of **$67,000** in the prior-year period[33](index=33&type=chunk) [Non-Interest Income](index=7&type=section&id=Q1%202025%20vs.%20Q1%202024%20-%20Non-Interest%20Income) Non-interest income increased by $85,000 (3.2%) to $2.8 million year-over-year, driven by higher service charges and fees and income from bank-owned life insurance (BOLI) - Non-interest income grew by **$85,000** YoY, driven by higher service charges and BOLI income[34](index=34&type=chunk) [Non-Interest Expense](index=7&type=section&id=Q1%202025%20vs.%20Q1%202024%20-%20Non-Interest%20Expense) Non-interest expense rose by $402,000 (2.7%) to $15.2 million compared to the prior year, primarily due to increases in salaries and benefits, advertising, and other expenses - Non-interest expense increased by **$402,000** YoY, with salaries and benefits being the largest contributor to the rise[35](index=35&type=chunk) - The efficiency ratio increased to **83.0%** from **82.0%** in the prior year, driven by higher expenses[36](index=36&type=chunk) [Income Tax Provision](index=7&type=section&id=Q1%202025%20vs.%20Q1%202024%20-%20Income%20Tax%20Provision) Income tax expense for Q1 2025 was $664,000, with an effective tax rate of 22.4%, compared to an expense of $827,000 and an effective tax rate of 21.8% in Q1 2024 - The effective tax rate was **22.4%** in Q1 2025, compared to **21.8%** in Q1 2024[37](index=37&type=chunk) [Balance Sheet Analysis](index=7&type=section&id=Balance%20Sheet%20Analysis) [Balance Sheet Overview](index=7&type=section&id=Balance%20Sheet%20Overview) As of March 31, 2025, total assets increased by $56.2 million (2.1%) from year-end 2024 to reach $2.7 billion, driven by increases in cash and total gross loans - Total assets grew to **$2.7 billion**, an increase of **$56.2 million** since December 31, 2024[38](index=38&type=chunk) [Loan Portfolio](index=9&type=section&id=Loan%20Portfolio) Total gross loans increased by $9.3 million (0.4%) to $2.1 billion in Q1 2025, primarily driven by residential real estate and commercial/industrial loans, partially offset by a decrease in commercial real estate loans Loan Portfolio Composition (in thousands) | Loan Category | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Commercial real estate | $1,072,687 | $1,075,732 | | Residential real estate | $783,788 | $775,659 | | Commercial and industrial | $216,368 | $211,656 | | Consumer | $3,865 | $4,391 | | **Total gross loans** | **$2,076,708** | **$2,067,438** | [Credit Quality](index=10&type=section&id=Credit%20Quality) Credit quality remains strong and stable, with total delinquent loans decreasing, nonaccrual loans slightly increasing, and the allowance for credit losses providing robust coverage Key Credit Quality Metrics | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Delinquent Loans | $4.5M (0.22%) | $5.0M (0.24%) | | Nonaccrual Loans | $6.0M (0.29%) | $5.4M (0.26%) | | Allowance for Credit Losses | $19.7M (0.95%) | $19.5M (0.94%) | | Allowance / Nonaccrual Loans | 327.1% | 362.9% | - Total criticized loans (special mention and substandard) decreased by **$2.1 million** to **$36.3 million**, or **1.7%** of total loans[48](index=48&type=chunk) [Deposits](index=10&type=section&id=Deposits) Total deposits increased by $66.0 million (2.9%) to $2.3 billion in Q1 2025, driven by core deposit growth, which now comprises 70.0% of total deposits Deposit Composition (in thousands) | Deposit Category | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Core Deposits | $1,629,316 | $1,559,064 | | Time Deposits | $699,277 | $703,583 | | **Total Deposits** | **$2,328,593** | **$2,262,647** | - Uninsured deposits totaled **$665.6 million**, or **28.6%** of total deposits, at March 31, 2025[51](index=51&type=chunk) [Investments](index=8&type=section&id=Investments) The investment securities portfolio totaled $369.8 million at quarter-end, with unrealized losses primarily attributed to interest rate changes rather than credit quality, as the portfolio consists mainly of high-quality government securities - The investment securities portfolio totaled **$369.8 million**, or **13.6%** of total assets[39](index=39&type=chunk) - Unrealized losses on the available-for-sale portfolio were **$27.8 million**, and on the held-to-maturity portfolio were **$35.8 million**[40](index=40&type=chunk) - Management has not recorded any credit impairment, attributing the unrealized losses to interest rate fluctuations, and expects price improvement as securities approach maturity[41](index=41&type=chunk)[42](index=42&type=chunk) [Borrowings and Liquidity](index=11&type=section&id=Borrowings%20and%20Liquidity) Total borrowings decreased slightly to $122.3 million, while the company maintains significant additional borrowing capacity from the FHLB and Federal Reserve Bank Discount Window, underscoring its strong liquidity position - Total borrowings stood at **$122.3 million** as of March 31, 2025, a slight decrease from the prior quarter[53](index=53&type=chunk) - The Company has substantial additional borrowing capacity, including **$447.5 million** at the FHLB and **$378.5 million** at the Federal Reserve Bank Discount Window[54](index=54&type=chunk) [Capital Position](index=4&type=section&id=Capital%20Position) Shareholders' equity increased to $237.7 million, with improvements in book value and tangible book value per share, and the Company's regulatory capital ratios remain strong and exceed well-capitalized levels Book Value Per Share | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Book Value Per Share | $11.44 | $11.30 | | Tangible Book Value Per Share (Non-GAAP) | $10.78 | $10.63 | Regulatory Capital Ratios (Company) | Ratio | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Capital (to Risk Weighted Assets) | 14.28% | 14.38% | | Tier 1 Capital (to Risk Weighted Assets) | 12.27% | 12.37% | | Tier 1 Leverage Ratio | 9.06% | 9.14% | - Shareholders' equity increased by **$1.8 million** to **$237.7 million** during the quarter[55](index=55&type=chunk) [Financial Statements and Reconciliations](index=13&type=section&id=Financial%20Statements%20and%20Reconciliations) [Consolidated Statements of Net Income](index=13&type=section&id=Consolidated%20Statements%20of%20Net%20Income) This section provides the unaudited Consolidated Statements of Net Income for the three months ended March 31, 2025, and the four preceding quarters, detailing revenues, expenses, and net income - The report includes detailed Consolidated Statements of Net Income for the last five quarters[63](index=63&type=chunk)[64](index=64&type=chunk) [Consolidated Balance Sheets](index=15&type=section&id=Consolidated%20Balance%20Sheets) This section presents the unaudited Consolidated Balance Sheets as of March 31, 2025, and for the four preceding quarter-ends, outlining assets, liabilities, and shareholders' equity - The report includes detailed Consolidated Balance Sheets for the last five quarter-ends[68](index=68&type=chunk)[69](index=69&type=chunk) [Other Data and Performance Ratios](index=16&type=section&id=Other%20Data%20and%20Performance%20Ratios) This section provides a summary of other key data and performance ratios, including per-share data, profitability ratios (NIM, ROA, ROE), efficiency ratios, and asset quality metrics for the last five quarters - The report includes a table summarizing key performance ratios and asset quality metrics for the last five quarters[70](index=70&type=chunk)[71](index=71&type=chunk) [Average Balances and Net Interest Income Analysis](index=18&type=section&id=Average%20Balances%20and%20Net%20Interest%20Income%20Analysis) This section contains a detailed table analyzing average asset and liability balances, interest income/expense, and the corresponding yields and costs, which form the basis for the net interest margin calculation for Q1 2025, Q4 2024, and Q1 2024 - The report provides a detailed breakdown of average balances, interest, and yields/costs for interest-earning assets and interest-bearing liabilities[73](index=73&type=chunk)[74](index=74&type=chunk) [Reconciliation of Non-GAAP to GAAP Financial Measures](index=20&type=section&id=Reconciliation%20of%20Non-GAAP%20to%20GAAP%20Financial%20Measures) This section provides reconciliations for non-GAAP financial measures used in the report, including tax-equivalent net interest margin, tangible book value per share, and the adjusted efficiency ratio, to their most directly comparable GAAP measures - The report includes tables reconciling non-GAAP measures such as tangible book value per share and adjusted efficiency ratio to their GAAP counterparts[76](index=76&type=chunk)[78](index=78&type=chunk)[79](index=79&type=chunk)

Group 1: Western New England Bancorp (WNEB) - WNEB shares increased by 6.8% to close at $8.49, following a notable trading volume compared to typical sessions, despite a 9.8% loss over the past four weeks [1] - The upcoming quarterly earnings are expected to be $0.12 per share, reflecting a year-over-year decline of 14.3%, while revenues are projected at $18.53 million, an increase of 2.8% from the previous year [2] - The consensus EPS estimate for WNEB has remained unchanged over the last 30 days, indicating that stock price movements may not sustain without earnings estimate revisions [3] Group 2: Societe Generale Group (SCGLY) - SCGLY shares rose by 14.9% to $8.48, with a return of -15.6% over the past month [3] - The consensus EPS estimate for SCGLY has increased by 6.5% over the past month to $0.33, representing a significant change of 200% from the previous year's report [4] - SCGLY currently holds a Zacks Rank of 1 (Strong Buy), indicating strong investor confidence [4]

Part I [Item 1. Business](index=5&type=section&id=ITEM%201.%20BUSINESS.) Western New England Bancorp, Inc. is a community-focused holding company with $2.7 billion in assets, operating through Westfield Bank in Massachusetts and Connecticut | Metric | Value (as of Dec 31, 2024) | | :--- | :--- | | Consolidated Total Assets | $2.7 billion | | Total Net Loans | $2.1 billion | | Total Deposits | $2.3 billion | | Total Shareholders' Equity | $235.9 million | - The Company's primary business is conducted through its wholly-owned subsidiary, Westfield Bank, a federally-chartered savings bank established in 1853[16](index=16&type=chunk)[17](index=17&type=chunk)[19](index=19&type=chunk) - The Bank operates 25 branches and numerous ATMs across Hampden and Hampshire counties in Massachusetts, and Hartford and Tolland counties in Connecticut[17](index=17&type=chunk)[21](index=21&type=chunk) - As of June 30, 2024, the company held the **third-largest market share** in Hampden County, with approximately 13.2% of total deposits[26](index=26&type=chunk) Human Capital - As of December 31, 2024, the Bank employed **335 people** (286 full-time and 49 part-time), with an average employee tenure of 8.8 years[29](index=29&type=chunk) - The company invests in talent development through programs like the Corporate Leadership Development Program, which had 24 participants in 2024, and offers educational reimbursement for employees[31](index=31&type=chunk) Lending Activities - The company's primary lending focus is on generating high-quality commercial loan relationships, including commercial real estate, construction, and commercial and industrial loans[39](index=39&type=chunk) - The regulatory limit on loans to one borrower was **$40.6 million** as of December 31, 2024; the company's largest lending relationship had a total exposure of $22.8 million[37](index=37&type=chunk) - During fiscal year 2024, the company sold **$20.1 million** in fixed-rate residential loans to the secondary market while retaining servicing rights, a strategy to manage interest rate risk[57](index=57&type=chunk) Loan Portfolio Composition (as of Dec 31, 2024) | Loan Category | Amount (in thousands) | Percent of Total | | :--- | :--- | :--- | | **Commercial Real Estate** | **$1,075,732** | **52.0%** | | Non-owner occupied | $880,828 | 42.6% | | Owner occupied | $194,904 | 9.4% | | **Residential Real Estate** | **$775,659** | **37.5%** | | Residential one-to-four family | $653,802 | 31.6% | | Home equity | $121,857 | 5.9% | | **Commercial and Industrial** | **$211,656** | **10.3%** | | **Consumer** | **$4,391** | **0.2%** | | **Total Gross Loans** | **$2,067,438** | **100.0%** | Asset Quality - Total criticized loans (Special Mention and Substandard) remained stable at **1.9% of total loans**, amounting to $38.4 million at year-end 2024 compared to $39.5 million at year-end 2023[77](index=77&type=chunk) - The company recorded **net recoveries of $87,000** in 2024, a significant improvement from net charge-offs of $2.0 million in 2023[85](index=85&type=chunk) - The company recorded a **reversal of credit losses of $665,000** for the year ended December 31, 2024, compared to a provision for credit losses of $872,000 in the prior year[100](index=100&type=chunk) Key Asset Quality Ratios | Metric | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Nonperforming loans to total loans | 0.26% | 0.32% | | Allowance for credit losses to total loans | 0.94% | 1.00% | | Allowance for credit losses to nonperforming loans | 362.93% | 315.64% | Investment Activities - At year-end 2024, the available-for-sale portfolio had **unrealized losses of $31.2 million**, and the held-to-maturity portfolio had **unrealized losses of $39.4 million**, attributed to interest rate fluctuations[113](index=113&type=chunk) Investment Securities Portfolio (as of Dec 31, 2024) | Security Type | Amortized Cost (in thousands) | Fair Value (in thousands) | | :--- | :--- | :--- | | **Available-for-sale** | **$191,940** | **$160,704** | | Debt securities | $24,424 | $21,068 | | Mortgage-backed securities | $167,516 | $139,636 | | **Held-to-maturity** | **$205,036** | **$165,606** | | Debt securities | $6,066 | $5,788 | | Mortgage-backed securities | $198,970 | $159,818 | Deposits - Total deposits increased to **$2.3 billion** at year-end 2024 from $2.1 billion at year-end 2023[114](index=114&type=chunk) - Core deposits represented **68.9% of total deposits** at December 31, 2024, down from 71.5% at the end of 2023, indicating a shift towards higher-cost time deposits[117](index=117&type=chunk) - Uninsured deposits increased to **28.4% of total deposits** at year-end 2024 from 26.8% at year-end 2023[116](index=116&type=chunk) Other Sources of Funds - Total borrowings decreased by 24.4% to **$103.4 million** at year-end 2024, driven by the repayment of $90.0 million borrowed under the Bank Term Funding Program (BTFP)[132](index=132&type=chunk)[133](index=133&type=chunk)[134](index=134&type=chunk) - As of December 31, 2024, the company had significant available liquidity, including **$464.1 million** in borrowing capacity from the FHLB and **$382.9 million** from the FRB Discount Window[134](index=134&type=chunk)[137](index=137&type=chunk)[138](index=138&type=chunk) - The company has **$19.8 million** in 4.875% fixed-to-floating rate subordinated notes outstanding, which qualify as Tier 2 capital[140](index=140&type=chunk)[141](index=141&type=chunk) Supervision and Regulation - The company is a savings and loan holding company regulated by the Federal Reserve Board (FRB), while its subsidiary, Westfield Bank, is regulated by the Office of the Comptroller of the Currency (OCC)[147](index=147&type=chunk)[148](index=148&type=chunk) - The company and the Bank are subject to Basel III capital rules, requiring minimum ratios for CET1 (7.0%), Tier 1 (8.5%), and Total capital (10.5%)[164](index=164&type=chunk)[170](index=170&type=chunk) - As of December 31, 2024, the Bank was categorized as **"well-capitalized"** under the Prompt Corrective Action (PCA) framework[172](index=172&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=ITEM%201A.%20RISK%20FACTORS.) The company faces significant risks from interest rate volatility, credit concentrations, competition, cybersecurity threats, and extensive government regulation - The company's earnings are highly sensitive to interest rate changes, as **net interest income accounted for 82.3% of total revenues** in 2024[214](index=214&type=chunk)[215](index=215&type=chunk) - The loan portfolio's concentration in commercial real estate, commercial & industrial, and consumer loans may expose the company to **greater credit risk** than traditional residential mortgage lending[217](index=217&type=chunk)[218](index=218&type=chunk) - The allowance for credit losses is based on significant management estimates (CECL model), and if these estimates prove inadequate, it could **materially affect the company's financial condition**[220](index=220&type=chunk)[223](index=223&type=chunk)[225](index=225&type=chunk) - The company operates in a highly regulated environment, and changes in laws or regulations could **increase costs and limit business opportunities**[248](index=248&type=chunk)[249](index=249&type=chunk) - **Cybersecurity threats** pose a significant risk that could disrupt operations, compromise confidential information, and result in financial loss and reputational damage[257](index=257&type=chunk) [Item 1C. Cybersecurity](index=50&type=section&id=ITEM%201C.%20CYBERSECURITY.) Cybersecurity risk is managed through a board-overseen framework that includes management committees, employee training, and third-party monitoring - The Board's Finance and Risk Management Committee has **ultimate oversight** of the company's enterprise risk management framework, including cybersecurity risks[289](index=289&type=chunk) - The company utilizes a management-level Strategic Technology Oversight Committee (TOC) and an ISO Metrics Oversight Committee to manage and monitor cybersecurity threats[281](index=281&type=chunk)[282](index=282&type=chunk) - The cybersecurity program includes regular employee training, social engineering tests, independent audits, penetration testing, and **continuous monitoring by a third-party Security Operations Center**[283](index=283&type=chunk)[287](index=287&type=chunk)[288](index=288&type=chunk) [Item 2. Properties](index=52&type=section&id=ITEM%202.%20PROPERTIES.) The company operates from its main office and 25 banking locations with a net book value of $24.4 million in owned premises and equipment - The company operates through **25 banking offices** and eight free-standing ATMs, supplemented by additional third-party serviced ATMs[295](index=295&type=chunk) - The net book value of owned premises and equipment was **$24.4 million** as of December 31, 2024[295](index=295&type=chunk) [Item 3. Legal Proceedings](index=55&type=section&id=ITEM%203.%20LEGAL%20PROCEEDINGS.) The company settled two class-action lawsuits regarding overdraft fees for approximately $510,000, with the expense recorded in 2023 - The company settled two class-action lawsuits concerning overdraft and insufficient funds fees for approximately **$510,000**[301](index=301&type=chunk)[303](index=303&type=chunk) - The settlement expense was recorded in non-interest expense for the year ended December 31, 2023, and the court granted final approval in January 2025[303](index=303&type=chunk) Part II [Item 5. Market for Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities](index=56&type=section&id=ITEM%205.%20MARKET%20FOR%20REGISTRANT'S%20COMMON%20EQUITY,%20RELATED%20SHAREHOLDER%20MATTERS%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES.) The company's stock (NASDAQ: WNEB) has an active repurchase program, with 237,695 shares bought back in Q4 2024 - On May 21, 2024, the Board authorized a new stock repurchase plan for up to **1,000,000 shares** of common stock[311](index=311&type=chunk) - As of December 31, 2024, **472,318 shares remained available for repurchase** under the current program[311](index=311&type=chunk) Share Repurchases | Period (2024) | Total Shares Purchased | Average Price Paid per Share ($) | | :--- | :--- | :--- | | October | 95,000 | 8.76 | | November | 54,383 | 9.04 | | December | 88,312 | 9.26 | | **Q4 Total** | **237,695** | **9.01** | [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=58&type=section&id=ITEM%207.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS.) Net income declined to $11.7 million in 2024 due to net interest margin compression, despite asset growth and a reversal of credit losses - The company's growth-oriented strategy focuses on increasing commercial and residential lending, growing core deposits, and improving efficiency through technology investments[320](index=320&type=chunk)[322](index=322&type=chunk) Key Financial Results | Metric | FY 2024 | FY 2023 | | :--- | :--- | :--- | | Net Income | $11.7 million | $15.1 million | | Diluted EPS | $0.56 | $0.70 | | Net Interest Income | $59.8 million | $67.9 million | | (Reversal) Provision for Credit Losses | ($0.67 million) | $0.87 million | Comparison of Financial Condition - Total assets increased by $88.5 million (3.5%) to **$2.7 billion** at year-end 2024[343](index=343&type=chunk) - Net loans grew by $42.9 million (2.1%) to **$2.1 billion**, led by a $53.5 million increase in residential real estate loans[349](index=349&type=chunk) - Total deposits grew by $118.9 million (5.6%) to **$2.3 billion**, with time deposits increasing 15.1% while core deposits grew 1.7%[386](index=386&type=chunk)[387](index=387&type=chunk) - Shareholders' equity decreased slightly to $235.9 million, while **tangible book value per share increased to $10.63** from $10.30[392](index=392&type=chunk)[393](index=393&type=chunk) Commercial Real Estate (CRE) Concentrations - The company holds a significant concentration in commercial real estate loans, which totaled **$1.1 billion (52.0% of total loans)** at year-end 2024[353](index=353&type=chunk)[361](index=361&type=chunk) - Non-owner occupied CRE loans totaled $880.8 million, representing **325.2% of the bank's total risk-based capital**[353](index=353&type=chunk)[366](index=366&type=chunk) - Office-related CRE loans totaled **$200.1 million** (73.9% of total bank risk-based capital) as of December 31, 2024, down from $216.2 million in the prior year[376](index=376&type=chunk)[379](index=379&type=chunk) CRE Portfolio by Property Type (Top 5) | CRE Property Type (Top 5) | Balance (in thousands) | % of CRE Portfolio | | :--- | :--- | :--- | | Office Portfolio | $200,115 | 18.6% | | Apartment | $179,874 | 16.7% | | Industrial | $168,281 | 15.6% | | Retail | $117,041 | 10.9% | | Mixed Use | $77,628 | 7.2% | Comparison of Operating Results - Net interest income **decreased by $8.1 million (11.9%)** in 2024 due to a $16.8 million increase in interest expense that outpaced an $8.7 million increase in interest income[397](index=397&type=chunk) - The **net interest margin compressed to 2.45%** in 2024 from 2.82% in 2023, as the average cost of funds rose 70 basis points while the average yield on interest-earning assets rose only 30 basis points[398](index=398&type=chunk)[399](index=399&type=chunk)[400](index=400&type=chunk) - Non-interest income increased by $2.0 million (18.4%) to **$12.9 million**, driven by higher gains on non-marketable equity investments and new income from loan-level swap fees[407](index=407&type=chunk)[408](index=408&type=chunk) - Non-interest expense remained flat at **$58.4 million**, as increases in salaries and FDIC insurance were offset by a decrease in professional fees[409](index=409&type=chunk)[410](index=410&type=chunk) Liquidity and Capital Resources - Primary sources of liquidity include deposits, loan repayments, and borrowings from the FHLB, and the company maintains sufficient liquidity to meet funding needs[413](index=413&type=chunk)[414](index=414&type=chunk) - At December 31, 2024, the company had **$464.1 million** in available borrowing capacity with the FHLB and **$382.9 million** with the FRB Discount Window[415](index=415&type=chunk)[416](index=416&type=chunk) - The company and the Bank **exceeded all regulatory capital requirements** to be considered "well-capitalized" as of December 31, 2024[424](index=424&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=81&type=section&id=ITEM%207A.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK.) The company's primary market risk is interest rate sensitivity, with net interest income projected to fall 4.4% in a +200 bps rate shock scenario - The company's interest rate management strategy aims to limit fluctuations in net interest income by coordinating asset and liability decisions and managing the duration of its portfolio[431](index=431&type=chunk)[433](index=433&type=chunk) Net Interest Income Sensitivity Analysis | Interest Rate Scenario | Estimated Change in Net Interest Income (Year 1) | | :--- | :--- | | +200 basis points | -4.4% | | -200 basis points | +3.9% | [Item 8. Financial Statements and Supplementary Data](index=81&type=section&id=ITEM%208.%20FINANCIAL%20STATEMENTS%20AND%20SUPPLEMENTARY%20DATA.) This section presents the audited consolidated financial statements for fiscal year 2024, which received an unqualified opinion from the auditor - The financial statements were prepared in conformity with U.S. GAAP and audited by Wolf & Company, P.C., who issued an **unqualified opinion**[490](index=490&type=chunk)[491](index=491&type=chunk) - A critical audit matter identified was the **Allowance for Credit Losses** for loans evaluated on a pooled basis, due to the significant judgment and complexity involved in the CECL methodology[497](index=497&type=chunk)[498](index=498&type=chunk)[499](index=499&type=chunk) [Item 9A. Controls and Procedures](index=81&type=section&id=ITEM%209A.%20CONTROLS%20AND%20PROCEDURES.) Management and the independent auditor concluded that the company's disclosure controls and internal controls over financial reporting were effective - Management concluded that the company's **disclosure controls and procedures were effective** as of the end of the fiscal year[450](index=450&type=chunk) - Management's assessment, based on the COSO framework, concluded that **internal control over financial reporting was effective** as of December 31, 2024[451](index=451&type=chunk) - The independent auditor, Wolf & Company, P.C., issued an **unqualified opinion** on the effectiveness of the company's internal control over financial reporting[456](index=456&type=chunk) Part III [Items 10-14](index=84&type=section&id=ITEMS%2010-14) Details regarding governance, compensation, and security ownership are incorporated by reference from the 2025 Proxy Statement - Information for Part III (Items 10, 11, 12, 13, and 14) is **incorporated by reference** from the company's Proxy Statement for the 2025 Annual Meeting of Shareholders[466](index=466&type=chunk)[467](index=467&type=chunk)[468](index=468&type=chunk)[469](index=469&type=chunk) Part IV [Item 15. Exhibits and Financial Statement Schedules](index=85&type=section&id=ITEM%2015.%20EXHIBITS%20AND%20FINANCIAL%20STATEMENT%20SCHEDULES.) This section lists all exhibits filed with the Form 10-K, including material contracts and required certifications - This section provides an index of all exhibits filed with the Form 10-K, including organizational documents, descriptions of securities, material contracts, and various certifications[474](index=474&type=chunk)[475](index=475&type=chunk)[476](index=476&type=chunk)

Western New England Bancorp (WNEB) reported $18.53 million in revenue for the quarter ended December 2024, representing a year-over-year decline of 1.9%. EPS of $0.16 for the same period compares to $0.12 a year ago.The reported revenue compares to the Zacks Consensus Estimate of $18.06 million, representing a surprise of +2.59%. The company delivered an EPS surprise of +33.33%, with the consensus EPS estimate being $0.12.While investors scrutinize revenue and earnings changes year-over-year and how they co ...

Western New England Bancorp (WNEB) came out with quarterly earnings of $0.16 per share, beating the Zacks Consensus Estimate of $0.12 per share. This compares to earnings of $0.12 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 33.33%. A quarter ago, it was expected that this bank holding company would post earnings of $0.10 per share when it actually produced earnings of $0.09, delivering a surprise of -10%.Over the last four ...

Western New England Bancorp, Inc. 8-K Exhibit 99.1 For further information contact: James C. Hagan, President and CEO Guida R. Sajdak, Executive Vice President and CFO Meghan Hibner, First Vice President and Investor Relations Officer 413-568-1911 WESTERN NEW ENGLAND BANCORP, INC. REPORTS RESULTS FOR THREE MONTHS AND YEAR ENDED DECEMBER 31, 2024 AND DECLARES QUARTERLY CASH DIVIDEND Westfield, Massachusetts, January 28, 2025: Western New England Bancorp, Inc. (the "Company" or "WNEB") (NasdaqGS: WNEB), the h ...

WESTFIELD, Mass., Jan. 28, 2025 (GLOBE NEWSWIRE) -- Western New England Bancorp, Inc. (the “Company” or “WNEB”) (NasdaqGS: WNEB), the holding company for Westfield Bank (the “Bank”), announced today the unaudited results of operations for the three and twelve months ended December 31, 2024. For the three months ended December 31, 2024, the Company reported net income of $3.3 million, or $0.16 per diluted share, compared to net income of $2.5 million, or $0.12 per diluted share, for the three months ended De ...

Financial Performance - Net income for Q3 2024 was $1.9 million, or $0.09 per diluted share, a decrease of 57.8% from $4.5 million, or $0.21 per diluted share in Q3 2023[189] - Net income for the three months ended September 30, 2024, was $1.9 million, or $0.09 per diluted share, compared to $4.5 million, or $0.21 per diluted share, for the same period in 2023[245] - Net income for the nine months ended September 30, 2024, was $8.4 million, or $0.40 per diluted share, down from $12.6 million, or $0.58 per diluted share in the same period of 2023[262] Interest Income and Expenses - Net interest income decreased by $1.7 million, or 10.1%, to $14.7 million in Q3 2024, primarily due to a $3.6 million increase in interest expense, or 37.8%[190] - Net interest income decreased by $1.7 million, or 10.1%, for the three months ended September 30, 2024[245] - Net interest income decreased by $7.2 million, or 13.9%, to $44.5 million for the nine months ended September 30, 2024, compared to $51.7 million for the same period in 2023[270] - Interest expense increased by $3.6 million, or 37.8%, primarily due to competitive pricing on deposits and a shift from low-cost core deposits to high-cost time deposits[251] - Interest expense on deposits increased by $3.5 million, or 44.9%, for the three months ended September 30, 2024[251] Asset and Loan Growth - Total assets increased by $75.9 million, or 3.0%, to $2.6 billion as of September 30, 2024, driven by a 152.4% increase in cash and cash equivalents[195] - Total loans increased by $21.7 million, or 1.1%, to $2.0 billion, with residential real estate loans rising by $26.4 million, or 3.7%[201] - Average interest-earning assets increased by $38.2 million, or 1.6%, to $2.4 billion, driven by a $31.3 million increase in average loans[254] Credit Quality - Total delinquency decreased to $4.3 million, or 0.21% of total loans, down from $6.0 million, or 0.30% at the end of 2023[202] - The allowance for credit losses as a percentage of total loans was 0.97% as of September 30, 2024, compared to 1.00% at December 31, 2023[203] - The company recorded a provision for credit losses of $941,000 in Q3 2024, compared to $354,000 in Q3 2023[191] - Provision for credit losses was $941,000 for the three months ended September 30, 2024, compared to $354,000 for the same period in 2023, reflecting an increase in the loan portfolio[257] Capital and Liquidity - Shareholders' equity at September 30, 2024, was $240.7 million, or 9.1% of total assets, compared to $237.4 million, or 9.3% of total assets, at December 31, 2023[242] - The Total Risk-Based Capital Ratio was 14.4% at September 30, 2024, compared to 14.7% at December 31, 2023[243] - The Company had $1.1 billion in immediately available liquidity at September 30, 2024[241] - The company exceeded all applicable regulatory capital requirements and was categorized as "well-capitalized" under the regulatory framework[302] Deposits - Total deposits increased by $80.5 million, or 3.8%, from $2.1 billion at December 31, 2023, to $2.2 billion at September 30, 2024[235] - Core deposits decreased by $8.3 million, or 0.5%, from $1.5 billion, or 71.5% of total deposits, at December 31, 2023, to $1.5 billion, or 68.5% of total deposits, at September 30, 2024[235] - Uninsured deposits represented 27.7% of total deposits at September 30, 2024, compared to 26.8% at December 31, 2023[236] Efficiency and Expenses - Non-interest income decreased by $471,000, or 13.0%, from $3.6 million in Q3 2023 to $3.1 million in Q3 2024[259] - Non-interest expense increased by $288,000, or 2.0%, to $14.4 million in Q3 2024 from $14.1 million in Q3 2023[260] - The efficiency ratio rose to 80.6% in Q3 2024 compared to 70.6% in Q3 2023, indicating lower revenues[261] - The efficiency ratio increased to 80.3% for the nine months ended September 30, 2024, compared to 72.7% for the same period in 2023[281] Tax and Other Expenses - Income tax expense for Q3 2024 was $618,000, with an effective tax rate of 24.5%, up from $1.0 million and 18.7% in Q3 2023[262] - Income tax expense for the nine months ended September 30, 2024, was $2.2 million, with an effective tax rate of 20.9%[282] Market and Regulatory Compliance - The bank's Tier 1 Leverage Ratio was 9.61% as of September 30, 2024, above the minimum requirement of 4.00%[306] - There have been no material changes in the company's assessment of market risk since the 2023 Annual Report[310] - The company has not identified any changes in internal control over financial reporting that materially affected its controls during the last fiscal quarter[312]

Western New England Bancorp (WNEB) reported $17.87 million in revenue for the quarter ended September 2024, representing a year-over-year decline of 10.7%. EPS of $0.09 for the same period compares to $0.21 a year ago.The reported revenue represents a surprise of +2.75% over the Zacks Consensus Estimate of $17.39 million. With the consensus EPS estimate being $0.10, the EPS surprise was -10.00%.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expec ...

Western New England Bancorp (WNEB) came out with quarterly earnings of $0.09 per share, missing the Zacks Consensus Estimate of $0.10 per share. This compares to earnings of $0.21 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -10%. A quarter ago, it was expected that this bank holding company would post earnings of $0.11 per share when it actually produced earnings of $0.17, delivering a surprise of 54.55%.Over the last four ...