Household Debt Overview - Total household debt in the U.S. reached $18.39 trillion in Q2 2025, with an increase of $4.24 trillion since Q4 2019 [2] - The increase in household debt is attributed to mortgages, home equity lines of credit (HELOC), auto loans, and credit cards [1] Mortgages - Mortgages represent the largest share of household debt, with balances rising by $131 billion to $12.94 trillion by the end of June 2025 [3] - Mortgage originations increased slightly to $458 billion in Q2 2025, while 53,000 homeowners faced foreclosure [3] Home Equity Lines of Credit (HELOC) - HELOC balances grew by $9 billion in Q2 2025, marking the 13th consecutive increase, totaling $411 billion [4] Credit Cards - Credit card balances surged by $27 billion in Q2 2025, bringing total credit card debt to $1.21 trillion [5] - Delinquency rates increased by 6.93%, indicating more Americans are struggling to manage monthly payments [6] Auto Loans - Auto loan balances rose by $13 billion in June 2025, totaling $1.66 trillion, with new auto loans and leases increasing to $188 billion [7] - The median credit score for new auto borrowers dropped by six points, suggesting that more individuals with weaker credit are seeking financing [7] Student Loans - Student loan balances increased by $7 billion in June 2025, reaching a total of $1.64 trillion [8] - Over 10% of student loan balances are now 90 days past due, reflecting rising delinquency rates as missed federal payments reappear on credit reports [8]

Core Financial Performance - The company reported net income of $6.2 million, or $0.88 per diluted share, for the quarter ended June 30, 2025, compared to $4.1 million, or $0.60 per diluted share, for the same quarter in 2024, marking a significant year-over-year increase [1] - For the nine months ended June 30, 2025, net income was $17.9 million, or $2.57 per diluted share, compared to $9.9 million, or $1.45 per diluted share, for the same period in 2024 [9] Revenue and Income Analysis - Net interest income increased by $2.2 million, or 15.1%, to $16.7 million for the quarter ended June 30, 2025, driven by an increase in interest income and a decrease in interest expense [3] - Noninterest income rose by $1.3 million for the quarter ended June 30, 2025, primarily due to gains from sales of SBA loans and home equity lines of credit [5] Expense Management - Noninterest expense increased by $1.3 million for the quarter ended June 30, 2025, mainly due to higher compensation and benefits related to stronger company performance [6] - The efficiency ratio improved to 64.45% for the quarter ended June 30, 2025, compared to 70.11% for the same period in 2024, indicating better cost management [30] Asset Quality and Credit Losses - The company recognized a provision for credit losses of $347,000 for loans and $77,000 for unfunded lending commitments for the quarter ended June 30, 2025, compared to higher provisions in the same period of 2024 [4] - Nonperforming loans decreased from $16.9 million at September 30, 2024, to $15.2 million at June 30, 2025, reflecting improved asset quality [4] Capital and Equity Position - Total stockholders' equity increased by $6.7 million, from $177.1 million at September 30, 2024, to $183.8 million at June 30, 2025, primarily due to retained earnings [18] - The company maintained a "well-capitalized" status under applicable regulatory capital guidelines as of June 30, 2025 [18] Strategic Outlook - The company is optimistic about continued profitability and growth in the SBA Lending segment, with a robust lending pipeline for the fourth fiscal quarter [2] - Focus areas include customer deposit growth, selective loan growth opportunities, and prudent capital and liquidity management [2]