Hanover Bancorp(US:HNVR)2025-08-08 20:00PART I - FINANCIAL INFORMATION Item 1. Financial Statements This section presents the unaudited consolidated financial statements of Hanover Bancorp, Inc. and its subsidiary for the periods ended June 30, 2025, and December 31, 2024, including statements of financial condition, income, comprehensive income, changes in stockholders' equity, and cash flows, along with detailed notes explaining the basis of presentation, accounting policies, and specific financial line items Consolidated Statements of Financial Condition This statement provides a snapshot of the company's assets, liabilities, and equity at specific points in time Consolidated Financial Condition (in thousands) | Metric | June 30, 2025 (unaudited) | December 31, 2024 | | :----------------------------------- | :-------------------------- | :------------------ | | Assets | | | | Total cash and cash equivalents | $164,535 | $162,857 | | Securities available for sale | $102,636 | $83,755 | | Loans, net | $1,944,881 | $1,962,745 | | TOTAL ASSETS | $2,311,976 | $2,312,110 | | Liabilities | | | | Total deposits | $1,951,281 | $1,954,283 | | Borrowings | $107,805 | $107,805 | | TOTAL LIABILITIES | $2,113,091 | $2,115,472 | | Stockholders' Equity | | | | TOTAL STOCKHOLDERS' EQUITY | $198,885 | $196,638 | - Total assets remained stable at approximately $2.31 billion from December 31, 2024, to June 30, 2025. Securities available for sale increased by $18.9 million, while net loans decreased by $17.86 million. Total stockholders' equity increased by $2.25 million9 Consolidated Statements of Income This statement details the company's revenues, expenses, and net income over a period Consolidated Income Statement (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total interest income | $32,049 | $33,420 | $64,886 | $65,852 | | Total interest expense | $17,254 | $20,173 | $35,462 | $39,670 | | Net interest income | $14,795 | $13,247 | $29,424 | $26,182 | | Provision for credit losses | $2,357 | $4,040 | $2,957 | $4,340 | | Total non-interest income | $3,561 | $3,622 | $7,293 | $7,198 | | Total non-interest expense | $12,616 | $11,670 | $28,612 | $22,474 | | NET INCOME | $2,443 | $844 | $3,964 | $4,905 | | Basic EPS | $0.33 | $0.11 | $0.53 | $0.67 | | Diluted EPS | $0.33 | $0.11 | $0.53 | $0.66 | - Net income for the three months ended June 30, 2025, significantly increased to $2.443 million from $0.844 million in the prior year, driven by higher net interest income and lower provision for credit losses. However, net income for the six months ended June 30, 2025, decreased to $3.964 million from $4.905 million in the prior year, primarily due to increased non-interest expenses, including one-time conversion costs11 Consolidated Statements of Comprehensive Income This statement presents net income and other comprehensive income items, such as unrealized gains or losses Consolidated Comprehensive Income (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $2,443 | $844 | $3,964 | $4,905 | | Net change in unrealized gains (losses) on securities available for sale | $201 | $(204) | $377 | $67 | | Change in unrealized (loss) gain on cash flow hedges | $(32) | $170 | $(270) | $1,056 | | Total other comprehensive income (loss), net of tax | $169 | $(34) | $107 | $1,123 | | Total comprehensive income, net of tax | $2,612 | $810 | $4,071 | $6,028 | - Total comprehensive income for the three months ended June 30, 2025, increased to $2.612 million from $0.810 million in the prior year, primarily due to net income growth and positive unrealized gains on available-for-sale securities. For the six months, total comprehensive income decreased to $4.071 million from $6.028 million, mainly due to a significant decrease in unrealized gains on cash flow hedges12 Consolidated Statements of Changes in Stockholders' Equity This statement outlines changes in equity components, including net income, dividends, and stock transactions Changes in Stockholders' Equity (in thousands) | Metric | Balance at January 1, 2025 | Balance at June 30, 2025 | Balance at January 1, 2024 | Balance at June 30, 2024 | | :----------------------------------- | :------------------------- | :----------------------- | :------------------------- | :----------------------- | | Total Stockholders' Equity | $196,638 | $198,885 | $184,830 | $190,072 | | Net income (6 months) | $3,964 | | $4,905 | | | Other comprehensive income (loss), net of tax (6 months) | $107 | | $1,123 | | | Cash dividends declared (6 months) | $(1,499) | | $(1,477) | | - Total stockholders' equity increased from $196.638 million at January 1, 2025, to $198.885 million at June 30, 2025, primarily driven by net income and other comprehensive income, partially offset by cash dividends1516 Consolidated Statements of Cash Flows This statement summarizes cash inflows and outflows from operating, investing, and financing activities Consolidated Cash Flows (in thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $2,052 | $493 | | Net cash provided by (used in) investing activities | $5,323 | $(92,501) | | Net cash (used in) provided by financing activities | $(5,697) | $55,916 | | Increase (decrease) in cash and cash equivalents | $1,678 | $(36,092) | | Cash and cash equivalents, end of period | $164,535 | $141,115 | - Net cash provided by operating activities increased significantly to $2.052 million for the six months ended June 30, 2025, from $0.493 million in the prior year. Investing activities shifted from a net outflow of $92.501 million in 2024 to a net inflow of $5.323 million in 2025, largely due to changes in securities purchases and maturities. Financing activities resulted in a net cash outflow of $5.697 million in 2025, a reversal from a net inflow of $55.916 million in 2024, primarily due to changes in deposits and borrowings19 Notes to Unaudited Consolidated Financial Statements This section provides detailed explanations and disclosures for the financial statements Note 1. Basis of Presentation and Accounting Policies This note describes the accounting principles and presentation methods used in the financial statements - Hanover Bancorp, Inc. reincorporated from New York to Maryland on June 25, 2025, following shareholder and regulatory approvals. The Company completed its core data processing system conversion to FIS Horizon in February 2025, incurring approximately $3.2 million in non-recurring expenses[2