{"url_path":"/sec/byfc/10-k/2026/item-16","section_key":"item-16","section_title":"Item 16 FORM 10-K SUMMARY","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-03-31","source_url":"https://www.sec.gov/Archives/edgar/data/1001171/0001140361-26-012311-index.html","accession_number":"0001140361-26-012311","cik":"0001001171","ticker":"BYFC","issuer_name":"BROADWAY FINANCIAL CORP \\DE\\","edgar_url":"https://www.sec.gov/Archives/edgar/data/1001171/0001140361-26-012311-index.html","primary_entity_key":"0001001171","primary_entity_name":"BROADWAY FINANCIAL CORP \\DE\\"},"word_count":20897,"has_tables":true,"body_markdown":"ITEM 16.\n\nFORM 10-K SUMMARY\n\nNone.\n\nSIGNATURES\n\nPursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its\nbehalf by the undersigned, thereunto duly authorized.\n\n \n\nBROADWAY FINANCIAL CORPORATION\n\n \n\n \n\n \n\nBy:\n\n/s/ BRIAN ARGRETT\n\n \n\n \n\n Brian Argrett\n\n \n\n \n\n Chief Executive Officer\n\n \n\nDate:\n\nMarch 31, 2026\n\nPursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant\nand in the capacities and on the dates indicated.\n\n/s/ BRIAN ARGRETT\n\nDate: March 31, 2026\n\n Brian Argrett\n\n \n\n Chief Executive Officer and President\n\n \n\n (Principal Executive Officer)\n\nChairman of the Board\n\n \n\n \n\n \n\n/s/ ZACK IBRAHIM\n\nDate: March 31, 2026\n\n Zack Ibrahim\n\n \n\n Chief Financial Officer\n\n \n\n(Principal Financial Officer and Principal Accounting Officer)\n\n \n\n \n\n \n\n /s/ WAYNE-KENT A. BRADSHAW\n\nDate: March 31, 2026\n\n Wayne-Kent A. Bradshaw\n\n \n\n Vice Chairman of the Board\n\n \n\n42\n\n[Table of Contents](#TABLEOFCONTENTS)\n\n/s/ MARIE C. JOHNS\n\nDate: March 31, 2026\n\n Marie C. Johns\n\n Lead Independent Director\n\n \n\n /s/ MARY M. HENTGES\n\nDate: March 31, 2026\n\nMary M. Hentges\n\n \n\nAudit Committee Chairman\n\n \n\n \n\n \n\n/s/ ROBERT C. DAVIDSON, JR.\n\nDate: March 31, 2026\n\n Robert C. Davidson, Jr.\n\n \n\n Director\n\n \n\n \n\n \n\n/s/ MARY ANN DONOVAN\n\nDate: March 31, 2026\n\nMary Ann Donovan\n\n \n\n Director\n\n \n\n \n\n \n\n /s/ DAVID J. MCGRADY\n\nDate: March 31, 2026\n\nDavid J. McGrady\n\n \n\nDirector\n\n \n\n \n\n \n\n /s/ DUTCH C. ROSS III\n\nDate: March 31, 2026\n\n Dutch C. Ross III\n\n \n\n Director\n\n \n\n \n\n \n\n /s/ JOHN M. DRIVER\n\nDate: March 31, 2026\n\n John M. Driver\n\n \n\n Director\n\n \n\n43\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nBROADWAY FINANCIAL CORPORATION AND SUBSIDIARY\n\n \n\nIndex to Consolidated Financial Statements\n\n \n\nYears ended December 31, 2025 and 2024\n\n \n\nReport of Independent Registered Public Accounting Firm (PCAOB ID #173)\n\nF‑1\n\n \n\n \n\nReport of Independent Registered Public Accounting Firm (PCAOB ID #23)\n\n F‑2\n\n \n\n \n\n[Consolidated Statements of Financial Condition](#ConsolidatedStatements)\n\nF‑3\n\n \n\n \n\n[Consolidated Statements of Operations and Comprehensive Income](#StatementsofOperations)\n\nF‑4\n\n \n\n \n\n[Consolidated Statements of Changes in Equity](#StockholdersEquity)\n\nF‑5\n\n \n\n \n\n[Consolidated Statements of Cash Flows](#CashFlows)\n\nF‑6\n\n \n\n \n\n[Notes to Consolidated Financial Statements](#Notes)\n\nF‑7\n\n \n\n[Table of Contents](#TABLEOFCONTENTS)\n\nREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM\n\nStockholders and the Board of Directors of Broadway Financial Corporation\n\nLos Angeles, California\n\nOpinion on the Financial Statements\n\nWe have audited the accompanying consolidated statement of financial condition of Broadway Financial Corporation (the \"Company\") as of December 31, 2025, the\nrelated consolidated statements of operations and comprehensive income, changes in stockholders’ equity, and cash flows for the year then ended, and the related notes (collectively referred to as the \"financial statements\"). In our opinion,\nthe financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025, and the results of its operations and its cash flows for the year then ended, in conformity with accounting\nprinciples generally accepted in the United States of America.\n\nBasis for Opinion\n\nThese financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements\nbased on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (\"PCAOB\") and are required to be independent with respect to the Company in accordance with the U.S. federal\nsecurities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\nWe conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance\nabout whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  As part\nof our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting.\nAccordingly, we express no such opinion.\n\nOur audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing\nprocedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and\nsignificant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.\n\nCritical Audit Matter\n\nThe critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to\nbe communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.  The communication of the\ncritical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the\naccounts or disclosures to which it relates.\n\nAllowance for Credit Losses – Qualitative Adjustments\n\nAs described in Notes 1 and 4 to the consolidated financial statements, the Company’s accounting for the allowance for credit losses on loans requires the\nCompany to recognize estimates for lifetime losses on loans at the time of origination or acquisition. The recognition of losses at origination or acquisition represents\nthe Company’s best estimate of the lifetime expected credit loss associated with a loan. Estimating expected credit losses requires management to use relevant forward-looking information, including the use of reasonable and supportable\nforecasts. As of December 31, 2025, the balance of the allowance for credit losses (“ACL”) was $9.4 million.\n\nThe Company uses the weighted-average remaining maturity method when determining estimates for the ACL for each of its portfolio segments. The Company then\nestimates a loss rate for each pool using both its own historical loss experience and the historical losses of a group of peer institutions. Since historical information may not always, by itself, provide a sufficient basis for determining\nfuture expected credit losses, the Company considers the need for qualitative adjustments. Qualitative adjustments may include, but are not limited to factors such as: (i) changes in lending policies and procedures, including changes in\nunderwriting standards and collections, charge offs and recovery practices; (ii) changes in international, national, regional and local conditions; (iii) changes in the nature and volume of the portfolio and terms of loans; (iv) changes in\nthe experience, depth and ability of lending management; (v) changes in the volume and severity of past due loans and other similar conditions; (vi) changes in the quality of the organization’s loan review system; (vii) changes in the value\nof underlying collateral for collateral dependent loans; (viii) the existence and effect of any concentrations of credit and changes in the levels of such concentrations; and (ix) the effect of other external factors on the level of estimated\ncredit losses.\n\nWe identified the auditing of the qualitative adjustments used in the allowance for credit losses-loans as a critical audit matter due the significant judgment\nrequired by management to develop the qualitative adjustments, which required significant audit effort and a high degree of auditor judgment to evaluate the qualitative adjustments given the volume and nature of inputs.\n\nTo address the matter, we performed the following substantive audit procedures related to the qualitative adjustments including:\n\n•\n\nEvaluated the methodology used for the qualitative adjustments;\n\n•\n\nTested the completeness and accuracy of data used in the calculation of qualitative adjustments;\n\n•\n\nEvaluated the reasonableness of management’s application of qualitative adjustments and resulting allocation to the ACL; and\n\n•\n\nEvaluated the relevance and reliability of external data sources used in the assessment of qualitative adjustments.\n\n/s/ Crowe LLP\n\nWe have served as the Company's auditor since 2025.\n\nWashington, District of Columbia\n\nMarch 31, 2026\n\nF-1\n\n[Table of Contents](#TABLEOFCONTENTS)\n\n Report of Independent Registered Public Accounting Firm\n\n \n\nThe Shareholders and the Board of Directors\n\nBroadway Financial Corporation\n\n \n\nOpinion on the Financial Statements\n\n \n\nWe have audited the accompanying consolidated statements of financial condition of Broadway Financial Corporation and subsidiary (the “Company”) as of December 31, 2024, the related consolidated statements of operations and comprehensive income, changes in stockholders’ equity, and cash flows for the year ended December 31, 2024, and the related notes (collectively, referred to as the consolidated financial statements). In our\nopinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of\nDecember 31, 2024, and the consolidated results of its operations and its cash flows for the year ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.\n\n \n\nBasis for Opinion\n\n \n\nThese consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s\nconsolidated financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United\nStates) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\n \n\nWe conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance\nabout whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial\nreporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial\nreporting. Accordingly, we express no such opinion.\n\n \n\nOur audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures to respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and\ndisclosures in the consolidated financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial\nstatements. We believe that our audit provides a reasonable basis for our opinion.\n\n/s/ Baker Tilly US, LLP\n\nSpokane, Washington\n\nMarch 31, 2025, except for the previously disclosed restatement\n\nto the 2024 consolidated financial statements, as to which\n\nthe date is December 23, 2025.\n\nWe served as the Company’s auditor from 2014 to 2025.\n\n \n\nF-2\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nBROADWAY FINANCIAL CORPORATION AND SUBSIDIARY\n\n \n\nConsolidated Statements of Financial\nCondition\n\n \n\n \n\n \n\nDecember 31,\n\n2025\n\n \n\n \n\nDecember 31,\n\n2024\n\n \n\n \n\n \n\n(In thousands, except share\n\nand per share)\n\n \n\nAssets:\n\n \n\n \n\n \n\n \n\n \n\n \n\nCash and due from banks\n\n \n\n$\n\n1,676\n\n \n\n \n\n$\n\n2,255\n\n \n\nInterest-bearing deposits in other banks\n\n \n\n \n\n8,831\n\n \n\n \n\n \n\n59,110\n\n \n\nCash and cash equivalents\n\n \n\n \n\n10,507\n\n \n\n \n\n \n\n61,365\n\n \n\nSecurities available-for-sale, at fair value (amortized cost of $265,371 and $219,658)\n\n \n\n \n\n256,835\n\n \n\n \n\n \n\n203,862\n\n \n\nLoans receivable held for investment, net of allowance of $9,424 and $8,364\n\n \n\n \n\n1,016,540\n\n \n\n \n\n \n\n999,956\n\n \n\nAccrued interest receivable\n\n \n\n \n\n5,999\n\n \n\n \n\n \n\n5,001\n\n \n\nFederal Home Loan Bank (FHLB) stock\n\n \n\n \n\n4,417\n\n \n\n \n\n \n\n9,637\n\n \n\nFederal Reserve Bank (FRB) stock\n\n \n\n \n\n3,543\n\n \n\n \n\n \n\n3,543\n\n \n\nOffice properties and equipment, net\n\n \n\n \n\n8,732\n\n \n\n \n\n \n\n8,899\n\n \n\nBank owned life insurance\n\n \n\n \n\n23,663\n\n \n\n \n\n \n\n3,321\n\n \n\nDeferred tax assets, net\n\n \n\n \n\n6,711\n\n \n\n \n\n \n\n8,880\n\n \n\nCore deposit intangible, net\n\n \n\n \n\n1,460\n\n \n\n \n\n \n\n1,775\n\n \n\nGoodwill\n\n \n\n \n\n–\n\n \n\n \n\n \n\n25,858\n\n \n\nOther assets\n\n \n\n \n\n7,162\n\n \n\n \n\n \n\n2,786\n\n \n\nTotal assets\n\n \n\n$\n\n1,345,569\n\n \n\n \n\n$\n\n1,334,883\n\n \n\nLiabilities and equity\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nLiabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDeposits\n\n \n\n$\n\n917,603\n\n \n\n \n\n$\n\n745,399\n\n \n\nSecurities sold under agreements to repurchase\n\n \n\n \n\n80,773\n\n \n\n \n\n \n\n66,610\n\n \n\nBorrowings\n\n \n\n \n\n72,000\n\n \n\n \n\n \n\n226,888\n\n \n\nAccrued expenses and other liabilities\n\n \n\n \n\n12,236\n\n \n\n \n\n \n\n10,794\n\n \n\nTotal liabilities\n\n \n\n \n\n1,082,612\n\n \n\n \n\n \n\n1,049,691\n\n \n\nStockholders’ equity:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNon-Cumulative Redeemable Perpetual Preferred stock, Series C; authorized 150,000 shares at December 31, 2025 and December 31, 2024; issued and outstanding 150,000 shares at December 31, 2025 and December 31, 2024; liquidation value $1,000 per share\n\n \n\n \n\n150,000\n\n \n\n \n\n \n\n150,000\n\n \n\nCommon stock, Class A, $0.01 par value, voting; authorized 75,000,000\nshares at December 31, 2025 and December 31, 2024; issued 6,409,760 shares at December 31, 2025 and 6,349,455 shares at December 31, 2024; outstanding 6,082,532 shares at December 31, 2025 and 6,022,227 shares at December 31, 2024\n\n \n\n \n\n64\n\n \n\n \n\n \n\n63\n\n \n\nCommon stock, Class B, $0.01 par value, non-voting; authorized 15,000,000\nshares at December 31, 2025 and December 31, 2024; issued and outstanding 1,425,404 shares at December 31, 2025 and\nissued and outstanding 1,425,574 shares at December 31, 2024\n\n \n\n \n\n14\n\n \n\n \n\n \n\n14\n\n \n\nCommon stock, Class C, $0.01 par value,\nnon-voting; authorized 25,000,000 shares at December 31, 2025 and December 31, 2024; issued and outstanding 1,672,562 at December 31, 2025 and December 31, 2024\n\n \n\n \n\n17\n\n \n\n \n\n \n\n17\n\n \n\nAdditional paid-in capital\n\n \n\n \n\n143,194\n\n \n\n \n\n \n\n142,902\n\n \n\n(Accumulated deficit) retained earnings\n\n \n\n \n\n(15,238\n\n)\n\n \n\n \n\n12,727\n\n \n\nUnearned Employee Stock Ownership Plan (ESOP) shares\n\n \n\n \n\n(3,869\n\n)\n\n \n\n \n\n(4,201\n\n)\n\nAccumulated other comprehensive loss, net of tax\n\n \n\n \n\n(6,105\n\n)\n\n \n\n \n\n(11,223\n\n)\n\nTreasury stock-at cost, 327,228\nshares at December 31, 2025 and at December 31, 2024\n\n \n\n \n\n(5,326\n\n)\n\n \n\n \n\n(5,326\n\n)\n\nTotal Broadway Financial Corporation and Subsidiary stockholders’ equity\n\n \n\n \n\n262,751\n\n \n\n \n\n \n\n284,973\n\n \n\nNon-controlling interest\n\n \n\n \n\n206\n\n \n\n \n\n \n\n219\n\n \n\nTotal liabilities and equity\n\n \n\n$\n\n1,345,569\n\n \n\n \n\n$\n\n1,334,883\n\n \n\nSee accompanying notes to consolidated financial statements.\n\n \n\nF-3\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nBROADWAY FINANCIAL CORPORATION AND SUBSIDIARY\n\n \n\nConsolidated Statements of Operations and\nComprehensive Income\n\n \n\n \n\n \n\nYears Ended December 31,\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n \n\n(In thousands, except per share)\n\n \n\nInterest income:\n\n \n\n \n\n \n\n \n\n \n\n \n\nInterest and fees on loans receivable\n\n \n\n$\n\n53,049\n\n \n\n \n\n$\n\n50,544\n\n \n\nInterest on available-for-sale securities\n\n \n\n \n\n6,412\n\n \n\n \n\n \n\n7,034\n\n \n\nOther interest income\n\n \n\n \n\n1,821\n\n \n\n \n\n \n\n6,368\n\n \n\nTotal interest income\n\n \n\n \n\n61,282\n\n \n\n \n\n \n\n63,946\n\n \n\nInterest expense:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nInterest on deposits\n\n \n\n \n\n19,930\n\n \n\n \n\n \n\n13,183\n\n \n\nInterest on borrowings\n\n \n\n \n\n8,205\n\n \n\n \n\n \n\n18,994\n\n \n\nTotal interest expense\n\n \n\n \n\n28,135\n\n \n\n \n\n \n\n32,177\n\n \n\nNet interest income\n\n \n\n \n\n33,147\n\n \n\n \n\n \n\n31,769\n\n \n\nProvision for credit losses\n\n \n\n \n\n2,186\n\n \n\n \n\n \n\n660\n\n \n\nNet interest income after provision for credit\nlosses\n\n \n\n \n\n30,961\n\n \n\n \n\n \n\n31,109\n\n \n\nNon-interest income:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nService charges\n\n \n\n \n\n184\n\n \n\n \n\n \n\n155\n\n \n\nGrants\n\n \n\n \n\n275\n\n \n\n \n\n \n\n280\n\n \n\nOther\n\n \n\n \n\n1,293\n\n \n\n \n\n \n\n1,119\n\n \n\nTotal non-interest income\n\n \n\n \n\n1,752\n\n \n\n \n\n \n\n1,554\n\n \n\nNon-interest expense:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCompensation and benefits\n\n \n\n \n\n18,838\n\n \n\n \n\n \n\n17,562\n\n \n\nOccupancy expense\n\n \n\n \n\n2,037\n\n \n\n \n\n \n\n1,858\n\n \n\nInformation services\n\n \n\n \n\n3,011\n\n \n\n \n\n \n\n2,763\n\n \n\nProfessional services\n\n \n\n \n\n3,008\n\n \n\n \n\n \n\n3,449\n\n \n\nSupervisory costs\n\n \n\n \n\n687\n\n \n\n \n\n \n\n785\n\n \n\nCorporate insurance\n\n \n\n \n\n271\n\n \n\n \n\n \n\n234\n\n \n\nAmortization of core deposit intangible\n\n \n\n \n\n315\n\n \n\n \n\n \n\n336\n\n \n\nOperational loss\n\n \n\n \n\n100\n\n \n\n \n\n \n\n–\n\n \n\nGoodwill impairment\n\n \n\n \n\n25,858\n\n \n\n \n\n \n\n–\n\n \n\nOther\n\n \n\n \n\n3,058\n\n \n\n \n\n \n\n2,907\n\n \n\nTotal non-interest expense\n\n \n\n \n\n57,183\n\n \n\n \n\n \n\n29,894\n\n \n\n(Loss) Income before income taxes\n\n \n\n \n\n(24,470\n\n)\n\n \n\n \n\n2,769\n\n \n\nIncome tax expense\n\n \n\n \n\n338\n\n \n\n \n\n \n\n815\n\n \n\nNet (loss) income\n\n \n\n$\n\n(24,808\n\n)\n\n \n\n$\n\n1,954\n\n \n\nLess: Net (loss) income attributable to non-controlling interest\n\n \n\n \n\n(13\n\n)\n\n \n\n \n\n25\n\n \n\nNet (loss) income attributable to Broadway Financial Corporation\n\n \n\n$\n\n(24,795\n\n)\n\n \n\n$\n\n1,929\n\n \n\nLess: Preferred stock dividends\n\n \n\n \n\n3,000\n\n \n\n \n\n \n\n1,567\n\n \n\nNet (loss) income attributable to common stockholders\n\n \n\n$\n\n(27,795\n\n)\n\n \n\n$\n\n362\n\n \n\nOther comprehensive (loss) income, net of tax:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nUnrealized gains on securities available-for-sale arising during the period\n\n \n\n$\n\n7,260\n\n \n\n \n\n$\n\n3,232\n\n \n\nIncome tax effect\n\n \n\n \n\n2,142\n\n \n\n \n\n \n\n930\n\n \n\nOther comprehensive income, net of tax\n\n \n\n \n\n5,118\n\n \n\n \n\n \n\n2,302\n\n \n\nComprehensive (loss) income\n\n \n\n$\n\n(22,677\n\n)\n\n \n\n$\n\n2,664\n\n \n\n(Loss) Earnings per common share-basic\n\n \n\n$\n\n(3.23\n\n)\n\n \n\n$\n\n0.04\n\n \n\n(Loss) Earnings per common share-diluted\n\n \n\n$\n\n(3.23\n\n)\n\n \n\n$\n\n0.04\n\n \n\n \n\nSee accompanying notes to consolidated financial statements\n\n \n\nF-4\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nBROADWAY FINANCIAL CORPORATION AND SUBSIDIARY\n\n \n\nConsolidated\nStatements of\nChanges in\nEquity\n\n(In thousands, except share and per share)\n\n \n\n \n\n \n\nPreferred Stock Non-Voting\n\n \n\n \n\nCommon Stock Voting\n\n \n\n \n\nCommon Stock Non-Voting\n\n \n\n \n\nAdditional Paid-in Capital\n\n \n\n \n\nAccumulated Other Comprehensive Loss\n\n \n\n \n\n(Accumulated Deficit) Retained Earnings\n\n \n\n \n\nUnearned ESOP Shares\n\n \n\n \n\nTreasury Stock\n\n \n\n \n\nNon-\n\nControlling Interest\n\n \n\n \n\nTotal\n\nEquity\n\n \n\nBalance at December 31, 2023\n\n \n\n$\n\n150,000\n\n \n\n \n\n$\n\n62\n\n \n\n \n\n$\n\n31\n\n \n\n \n\n$\n\n142,601\n\n \n\n \n\n$\n\n(13,525\n\n)\n\n \n\n$\n\n12,365\n\n \n\n \n\n$\n\n(4,492\n\n)\n\n \n\n$\n\n(5,326\n\n)\n\n \n\n$\n\n194\n\n \n\n \n\n$\n\n281,910\n\n \n\nNet income\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,929\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n25\n\n \n\n \n\n \n\n1,954\n\n \n\nRelease of unearned ESOP shares\n\n \n\n \n\n–\n\n \n\n \n\n \n\n1\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(104\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n291\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n188\n\n \n\nStock-based compensation expense\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n309\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n309\n\n \n\nDirector stock compensation expense\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n96\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n96\n\n \n\nDividends declared and paid - Emergency Capital Investment Program (“ECIP”)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(1,567\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(1,567\n\n)\n\nOther comprehensive income, net of tax\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,302\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,302\n\n \n\nBalance at December 31, 2024\n\n \n\n \n\n150,000\n\n \n\n \n\n \n\n63\n\n \n\n \n\n \n\n31\n\n \n\n \n\n \n\n142,902\n\n \n\n \n\n \n\n(11,223\n\n)\n\n \n\n \n\n12,727\n\n \n\n \n\n \n\n(4,201\n\n)\n\n \n\n \n\n(5,326\n\n)\n\n \n\n \n\n219\n\n \n\n \n\n \n\n285,192\n\n \n\nNet loss\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(24,795\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(13\n\n)\n\n \n\n \n\n(24,808\n\n)\n\nRelease of unearned ESOP shares\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(183\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n332\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n149\n\n \n\nStock-based compensation expense\n\n \n\n \n\n–\n\n \n\n \n\n \n\n1\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n307\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n308\n\n \n\nDirector stock compensation expense\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n168\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n168\n\n \n\nDividends declared and paid - ECIP\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(3,000\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(3,000\n\n)\n\nCity First Bank Fund Manager II Distribution\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(170\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(170\n\n)\n\nOther comprehensive income, net of tax\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n5,118\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n5,118\n\n \n\nBalance at December 31, 2025\n\n \n\n$\n\n150,000\n\n \n\n \n\n$\n\n64\n\n \n\n \n\n$\n\n31\n\n \n\n \n\n$\n\n143,194\n\n \n\n \n\n$\n\n(6,105\n\n)\n\n \n\n$\n\n(15,238\n\n)\n\n \n\n$\n\n(3,869\n\n)\n\n \n\n$\n\n(5,326\n\n)\n\n \n\n$\n\n206\n\n \n\n \n\n$\n\n262,957\n\n \n\nSee accompanying notes to consolidated financial statements.\n\n \n\nF-5\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nBROADWAY FINANCIAL CORPORATION AND SUBSIDIARY\n\n \n\nConsolidated\nStatements of\n\nCash Flows\n\n \n\n \n\nYears Ended December 31\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nCash flows from operating activities:\n\n \n\n \n\n \n\n \n\n \n\n \n\nNet (loss) income\n\n \n\n$\n\n(24,808\n\n)\n\n \n\n$\n\n1,954\n\n \n\nAdjustments to reconcile net income to net cash provided by operating activities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nProvision for credit losses\n\n \n\n \n\n2,186\n\n \n\n \n\n \n\n660\n\n \n\nDepreciation and amortization\n\n \n\n \n\n410\n\n \n\n \n\n \n\n424\n\n \n\nNet change of deferred loan origination costs\n\n \n\n \n\n531\n\n \n\n \n\n \n\n641\n\n \n\nNet accretion of premiums and discounts on available-for-sale securities\n\n \n\n \n\n(387\n\n)\n\n \n\n \n\n(807\n\n)\n\nAccretion of purchase accounting marks on loans\n\n \n\n \n\n(253\n\n)\n\n \n\n \n\n(424\n\n)\n\nAmortization of core deposit intangible\n\n \n\n \n\n315\n\n \n\n \n\n \n\n336\n\n \n\nDirector compensation expense-common stock\n\n \n\n \n\n168\n\n \n\n \n\n \n\n96\n\n \n\nAccretion of premium on FHLB advances\n\n \n\n \n\n–\n\n \n\n \n\n \n\n(9\n\n)\n\nStock-based compensation expense\n\n \n\n \n\n308\n\n \n\n \n\n \n\n309\n\n \n\nESOP compensation expense\n\n \n\n \n\n149\n\n \n\n \n\n \n\n188\n\n \n\nEarnings on bank owned life insurance\n\n \n\n \n\n(342\n\n)\n\n \n\n \n\n(46\n\n)\n\nGoodwill impairment\n\n \n\n \n\n25,858\n\n \n\n \n\n \n\n–\n\n \n\nNet change in assets and liabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDeferred tax assets\n\n \n\n \n\n27\n\n \n\n \n\n \n\n(194\n\n)\n\nAccrued interest receivable\n\n \n\n \n\n(998\n\n)\n\n \n\n \n\n(63\n\n)\n\nOther assets\n\n \n\n \n\n(4,376\n\n)\n\n \n\n \n\n1,412\n\n \n\nAccrued expenses and other liabilities\n\n \n\n \n\n1,442\n\n \n\n \n\n \n\n(3,084\n\n)\n\nNet cash provided by operating activities\n\n \n\n \n\n230\n\n \n\n \n\n \n\n1,393\n\n \n\nCash flows from investing activities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet change in loans receivable held for investment\n\n \n\n \n\n(19,048\n\n)\n\n \n\n \n\n(89,204\n\n)\n\nPrincipal payments and maturities of available-for-sale securities\n\n \n\n \n\n105,142\n\n \n\n \n\n \n\n117,127\n\n \n\nPurchases of available-for-sale securities\n\n \n\n \n\n(150,468\n\n)\n\n \n\n \n\n–\n\n \n\nPurchase of FHLB stock\n\n \n\n \n\n(16,081\n\n)\n\n \n\n \n\n(13,654\n\n)\n\nProceeds from redemption of FHLB stock\n\n \n\n \n\n21,301\n\n \n\n \n\n \n\n14,173\n\n \n\nPurchases of bank owned life insurance\n\n \n\n \n\n(20,000\n\n)\n\n \n\n \n\n–\n\n \n\nPurchase of office properties and equipment\n\n \n\n \n\n(243\n\n)\n\n \n\n \n\n(138\n\n)\n\nNet cash (used in) provided by investing activities\n\n \n\n \n\n(79,397\n\n)\n\n \n\n \n\n28,304\n\n \n\nCash flows from financing activities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet change in deposits\n\n \n\n \n\n172,204\n\n \n\n \n\n \n\n62,764\n\n \n\nNet change in securities sold under agreements to repurchase\n\n \n\n \n\n14,163\n\n \n\n \n\n \n\n(6,865\n\n)\n\nRepayments of Bank Term Funding Program borrowing\n\n \n\n \n\n–\n\n \n\n \n\n \n\n(100,000\n\n)\n\nCity First Bank Fund Manager II distribution\n\n \n\n \n\n(170\n\n)\n\n \n\n \n\n–\n\n \n\nRepayment of notes payable\n\n \n\n \n\n–\n\n \n\n \n\n \n\n(14,000\n\n)\n\nDividends paid on ECIP preferred stock\n\n \n\n \n\n(3,000\n\n)\n\n \n\n \n\n(1,567\n\n)\n\nProceeds from other borrowings\n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,508\n\n \n\nRepayments of other borrowings\n\n \n\n \n\n(31,356\n\n)\n\n \n\n \n\n(2,589\n\n)\n\nProceeds from FHLB advances\n\n \n\n \n\n955,750\n\n \n\n \n\n \n\n339,000\n\n \n\nRepayments of FHLB advances\n\n \n\n \n\n(1,079,282\n\n)\n\n \n\n \n\n(352,778\n\n)\n\nNet cash provided by (used in) financing activities\n\n \n\n \n\n28,309\n\n \n\n \n\n \n\n(73,527\n\n)\n\nNet change in cash and cash equivalents\n\n \n\n \n\n(50,858\n\n)\n\n \n\n \n\n(43,830\n\n)\n\nCash and cash equivalents at beginning of the period\n\n \n\n \n\n61,365\n\n \n\n \n\n \n\n105,195\n\n \n\nCash and cash equivalents at end of the period\n\n \n\n$\n\n10,507\n\n \n\n \n\n$\n\n61,365\n\n \n\nSupplemental disclosures of cash flow information:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCash paid for interest\n\n \n\n27,851\n\n \n\n \n\n30,628\n\n \n\nCash paid for income taxes\n\n \n\n \n\n325\n\n \n\n \n\n \n\n416\n\n \n\nSee accompanying notes to consolidated financial statements.\n\nF-6\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nBROADWAY FINANCIAL CORPORATION AND SUBSIDIARY\n\n \n\nNotes to Consolidated Financial Statements\n\n \n\nDecember 31, 2025 and 2024\n\n \n\nNote 1 – Summary of Significant Accounting Policies\n\n \n\nNature of Operations and Principles of Consolidation\n\n \n\nBroadway Financial Corporation (the “Company”) was incorporated under Delaware law in 1995 for the purpose of acquiring\nand holding all of the outstanding capital stock of Broadway Federal Savings and Loan Association as part of the bank’s conversion from a federally chartered mutual savings association to a federally chartered stock savings bank. In connection\nwith the conversion, the bank’s name was changed to Broadway Federal Bank, f.s.b. (“Broadway Federal”). In 1996, the conversion was completed, and Broadway Federal became a wholly‑owned subsidiary of the Company.\n\nIn 2021, the Company completed its merger with CFBanc Corporation, with the Company continuing as the surviving entity.\nImmediately following the CFBanc Merger, Broadway Federal merged with and into City First Bank of D.C, National Association with City First Bank of D.C., National Association (the “Bank”) continuing as the surviving entity (combined with Broadway\nFederal). Concurrently with the Merger, the Bank changed its name to City First Bank, National Association.\n\nThe Bank’s business is that of a financial intermediary and consists primarily of attracting deposits from the general\npublic and using such deposits, together with borrowings and other funds, to make mortgage loans secured by residential and commercial real estate located in the Bank’s market areas. At December 31, 2025, the Bank operated three retail‑banking offices: Los Angeles and in the nearby city of Inglewood in California, and another in Washington, D.C. The Bank is subject to\nsignificant competition from other financial institutions and is also subject to regulation by certain federal agencies and undergoes periodic examinations by those regulatory authorities.\n\nThe accompanying consolidated financial statements include Broadway Financial Corporation and its wholly owned subsidiary,\nCity First Bank, National Association (together with the Company, “City First Broadway”). Also included in the consolidated financial statements are the following subsidiaries of City First Bank: 1432 U Street LLC, Broadway Service Corporation,\nCity First Real Estate LLC, City First Real Estate II LLC, City First Real Estate III LLC, City First Real Estate IV LLC, and CF New Markets Advisors, LLC (“CFNMA”). In addition, CFNMA also consolidates CFC Fund Manager II, LLC; City First New\nMarkets Fund II, LLC; and City First Capital IX, LLC into its financial results. All significant intercompany balances and transactions have been eliminated in consolidation.\n\nCertain amounts in the prior year financial statements have been reclassified to conform to the current year presentation. Such reclassifications had no impact on\ntotal equity or net income for any period.\n\nUse of Estimates\n\n \n\nTo prepare consolidated financial statements in conformity\nwith U.S. generally accepted accounting principles, management makes estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the consolidated financial statements and the\ndisclosures provided, and actual results could differ from these estimates. The allowance and provision for credit losses, deferred tax asset valuation allowance, and fair values of investment securities and other financial instruments are\nparticularly subject to change.\n\n \n\nCash and Cash Equivalents\n\n \n\nCash and cash equivalents include cash on hand, cash items in the process of collection, amounts due from correspondent banks and the Federal Reserve Bank of San\nFrancisco (the “Federal Reserve Bank”), and interest‑bearing deposits in other banks with initial terms of ninety days or less. The Company may be required to maintain reserve and clearing balances with the Federal Reserve Bank under the Federal\nReserve Act of 1913, as amended. Effective on March 26, 2020, as a part of Federal Reserve Bank’s tools to promote maximum employment, Federal Reserve Bank Board reduced reserve requirement ratios to zero. The reserve and clearing requirement\nbalance were no longer required at December 31, 2025. Net cash flows are reported for customer loan and deposit transactions, interest‑bearing deposits in other banks, notes payable, deferred income taxes and other assets and liabilities. $103 thousand of cash and cash equivalents was restricted as of December 31, 2025.\n\n \n\nInvestment Securities\n\n \n\nDebt securities are classified as held‑to‑maturity and carried at amortized cost when management has the positive intent and ability to hold them to maturity. Debt\nsecurities are classified as available‑for‑sale when they might be sold before maturity. Securities available‑for‑sale are carried at fair value, with unrealized holding gains and losses reported in other comprehensive income (loss), net of tax.\n\n \n\nInterest income includes amortization of purchase premium or discount. Premiums and discounts on securities are amortized on the level‑yield method without\nanticipating prepayments. Gains and losses on sales are recorded on the trade date and determined using the specific identification method.\n\n \n\nThe Company accounts for the allowance for credit losses (“ACL”) on securities in accordance with Accounting Standards Codification Topic 326 (“ASC 326”) – Financial Instruments-Credit Losses. The ACL on securities is recorded at the time of purchase or acquisition, representing the Company’s best estimate of current expected credit losses (“CECL”) as of the date\nof the consolidated statements of financial condition.\n\nFor available-for-sale investment securities, the Company performs a qualitative evaluation for those securities that are in an unrealized loss position to\ndetermine if the decline in fair value is credit related or non-credit related. In determining whether a security’s decline in fair value is credit related, the Company considers a number of factors including, but not limited to: (i) the extent\nto which the fair value of the investment is less than its amortized cost; (ii) the financial condition and near-term prospects of the issuer; (iii) any downgrades in credit ratings; (iv) the payment structure of the security; (v) the ability of\nthe issuer of the security to make scheduled principal and interest payments; and (vi) general market conditions which reflect prospects for the economy as a whole, including interest rates and sector credit spreads. For investment securities\nwhere the Company has reason to believe the credit loss exposure is remote, a zero credit loss assumption is applied. Such investment securities typically consist of those guaranteed by the U.S. government or other government enterprises, where\nthere is an explicit or implicit guarantee by the U.S. government, that are highly rated by rating agencies, and historically have had no credit loss experience.\n\nIf it is determined that the unrealized loss, or a portion thereof, is credit related, the Company records the amount of credit loss through a charge to the\nprovision for credit losses in current period earnings. However, the amount of credit loss recorded in current period earnings is limited to the amount of the total unrealized loss on the security, which is measured as the amount by which the\nsecurity’s fair value is below its amortized cost. If the Company intends to sell a security that is in an unrealized loss position, or if it is more likely than not the Company will be required to sell a security in an unrealized loss position,\nthe total amount of the unrealized loss is recognized in current period earnings through the provision for credit losses. Unrealized losses deemed non-credit related are recorded, net of tax, in accumulated other comprehensive income (loss).\n\nThe Company analyzed available-for-sale investment securities that were in an unrealized loss position and determined the decline in fair value for those securities\nwas not related to credit, but rather related to changes in interest rates and general market conditions. As such, no ACL was\nrecorded for available-for-sale securities as of December 31, 2025 and 2024.\n\n \n\nF-7\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nLoans Receivable Held for Investment\n\n \n\nLoans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at the principal balance outstanding,\nnet of allowance for credit losses, deferred loan fees and costs and unamortized premiums and discounts. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct loan origination costs, premiums and\ndiscounts are deferred, and recognized in income using the level‑yield method without anticipating prepayments.\n\n \n\nInterest income on all loans is discontinued at the time the loan is 90\ndays delinquent unless the loan is well‑secured and in process of collection. Past due status is based on the contractual terms of the loan. In all cases, loans are placed on non‑accrual or charged‑off at an earlier date if collection of\nprincipal or interest is considered doubtful.\n\n \n\nAll interest accrued but not received for loans placed on non‑accrual is reversed against interest income. Interest received on such loans is accounted for on the\ncash‑basis or cost recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.\n\n \n\nConcentration of Credit Risk\n\n \n\nConcentrations of credit risk arise when several customers are engaged in similar business activities, or activities in the same geographic region, or\nhave similar economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic conditions. The Company’s lending activities are predominantly in real estate loans that are secured\nby properties located in Southern California and in Washington, D.C. and surrounding areas, and many of the borrowers reside in those areas. Therefore, the Company’s exposure to credit risk is significantly affected by changes in the economy\nand real estate market in the markets in which the Company operates.\n\n \n\nAllowance for Credit Losses - Loans\n\n \n\nThe Company accounts for credit losses on loans in accordance with ASC 326, which requires the Company to record an estimate of expected lifetime credit losses for\nloans at the time of origination or acquisition. The ACL is maintained at a level deemed appropriate by management to provide for expected credit losses in the portfolio as of the date of the consolidated statements of financial condition.\nEstimating expected credit losses requires management to use relevant forward-looking information, including the use of reasonable and supportable forecasts. The measurement of the ACL is performed by collectively evaluating loans with similar\nrisk characteristics. The Company measures the ACL for each of its loan segments using the weighted-average remaining maturity (“WARM”) method. The weighted average remaining life, including the effect of estimated prepayments, is calculated for\neach loan pool on a quarterly basis. The Company then estimates a loss rate for each pool using both its own historical loss experience and the historical losses of a group of peer institutions during the period from 2004 through the most recent\nquarter.\n\n \n\nThe Company’s ACL model also includes adjustments for qualitative factors, where appropriate. Since historical information (such as historical net losses) may not\nalways, by itself, provide a sufficient basis for determining future expected credit losses, the Company periodically considers the need for qualitative adjustments to the ACL. Qualitative adjustments may include, but are not limited to factors\nsuch as: (i) changes in lending policies and procedures, including changes in underwriting standards and collections, charge offs, and recovery practices; (ii) changes in international, national, regional, and local conditions; (iii) changes in\nthe nature and volume of the portfolio and terms of loans; (iv) changes in the experience, depth, and ability of lending management; (v) changes in the volume and severity of past due loans and other similar conditions; (vi) changes in the\nquality of the organization’s loan review system; (vii) changes in the value of underlying collateral for collateral dependent loans; (viii) the existence and effect of any concentrations of credit and changes in the levels of such\nconcentrations; and (ix) the effect of other external factors (i.e., competition, legal and regulatory requirements) on the level of estimated credit losses.\n\n \n\nThe Company has a credit portfolio review process designed to detect problem loans. Problem loans are typically those of a substandard or worse internal risk grade,\nand may consist of loans on nonaccrual status, loans that have recently been modified in response to a borrower’s deteriorating financial condition, loans where the likelihood of foreclosure on underlying collateral has increased, collateral\ndependent loans, and other loans where concern or doubt over the ultimate collectability of all contractual amounts due has become elevated. Such loans may, in the opinion of management, be deemed to no longer possess risk characteristics similar\nto other loans in the loan portfolio, because the specific attributes and risks associated with the loan have likely become unique as the credit quality of the loan deteriorates. As such, these loans may require individual evaluation to determine\nan appropriate ACL for the loan. When a loan is individually evaluated, the Company typically measures the expected credit loss for the loan based on a discounted cash flow approach, unless the loan has been deemed collateral dependent.\nCollateral dependent loans are loans where the repayment of the loan is expected to come from the operation of and/or eventual liquidation of the underlying collateral. The ACL for collateral dependent loans is determined using estimates of the\nfair value of the underlying collateral, less estimated selling costs.\n\nF-8\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nThe estimation of the appropriate level of the ACL requires significant judgment by management. Although management uses the best information available to make these\nestimates, future adjustments to the ACL may be necessary due to economic, operating, regulatory, and other conditions that may extend beyond the Company’s control. Changes in management’s estimates of forecasted net losses could materially\nchange the level of the ACL. Additionally, various regulatory agencies, as an integral part of their examination process, periodically review the Company’s ACL and credit review process. Such agencies may require the Company to recognize\nadditions to the ACL based on judgments different from those of management.\n\n \n\nThe Company has segmented the loan portfolio according to loans that share similar attributes and risk characteristics. Each segment possesses varying degrees of\nrisk based on, among other things, the type of loan, the type of collateral, and the sensitivity of the borrower or industry to changes in external factors such as economic conditions. The Company determines the ACL for loans based on this more\ndetailed loan segmentation and classification. These segments, and the risks associated with each segment, are as follows:\n\nReal Estate: Single-Family – Subject to adverse\nemployment conditions in the local economy leading to increased default rate, decreased market values from oversupply in a geographic area and incremental rate increases on adjustable-rate mortgages which may impact the ability of borrowers to\nmaintain payments.\n\nReal Estate: Multi‑Family – Subject to adverse various\nmarket conditions that cause a decrease in market value or lease rates, changes in personal funding sources for tenants, oversupply of units in a specific region, population shifts and reputational risks.\n\nReal Estate: Commercial Real Estate – Subject to adverse conditions in the local\neconomy which may lead to reduced cash flows due to vacancies and reduced rental rates and decreases in the value of underlying collateral.\n\n \n\nReal Estate: Church – Subject to adverse economic and employment conditions, which\nmay lead to reduced cash flows from members’ donations and offerings, and the stability, quality, and popularity of church leadership.\n\n \n\nReal Estate: Construction – Subject to adverse conditions in the local economy,\nwhich may lead to reduced demand for new commercial, multi‑family, or single-family buildings or reduced lease or sale opportunities once the building is complete.\n\n \n\nCommercial – Subject to industry and economic conditions including decreases in product demand.\n\n \n\nConsumer – Subject to adverse employment conditions in the local economy, which may lead to higher default rates.\n\nSBA – Subject to Federal legislation that can affect the funding and availability of the program.\n\n \n\nModified Loans to Borrowers Experiencing Financial Difficulty\n\nIn certain instances, the Company makes modifications to loans in order to alleviate temporary difficulties in the borrower’s financial condition and/or constraints on the borrower’s ability to repay the loan, and to minimize potential losses to\nthe Company. Modifications include: changes in the amortization terms of the loan, reductions in interest rates, acceptance of interest only payments, and reductions to the outstanding loan balance (or any combination of such changes). Such loans\nare typically placed on nonaccrual status when there is doubt concerning the full repayment of principal and interest or the loan has been in default for a period of 90 days or more. Such loans may be returned to accrual status when all\ncontractual amounts past due have been brought current, and the borrower’s performance under the modified terms of the loan agreement and the ultimate collectability of all contractual amounts due under the modified terms is no longer in doubt.\nThe Company typically measures the ACL on these loans on an individual basis as the loans are deemed to no longer have risk characteristics that are similar to other loans in the portfolio. The determination of the ACL for these loans is based on\nthe remaining life approach, unless the loan is deemed collateral dependent, which requires measurement of the ACL based on the estimated expected fair value of the underlying collateral, less selling costs.\n\nDerivatives\n\nAt the inception of a derivative\ncontract, the Company designates the derivative as one of three types based on the Company’s intentions and belief as to likely effectiveness as a hedge.  These three types are (1) a hedge of the fair value of a recognized asset or liability\nor of an unrecognized firm commitment, (2) a hedge of a forecasted transaction or the variability of cash flows to be received or paid related to a recognized asset or liability, or (3) an instrument with no hedging designation\n(“non-designated derivative”). The Company has designated its derivatives as non-designated derivatives.  Changes in the fair value of derivatives not designated are  currently reported in earnings, as non-interest income.\n\nThe Company is exposed to losses if a counterparty fails to make its\npayments under a contract in which the Company is in the net receiving position.  The Company anticipates that the counterparties will be able to fully satisfy their obligations under the agreements. All of the contracts to which the\nCompany is a party settle monthly.  In addition, the Company obtains collateral above certain thresholds of the fair value of its derivatives for each dealer counterparty based upon their credit standing and the Company has netting\nagreements with the dealers with which it does business.\n\nGoodwill and Other Intangible Assets\n\nGoodwill is recorded upon completion of a business combination as the difference between the purchase price and the fair value of net identifiable assets acquired.\nSubsequent to initial recognition, the Company tests goodwill for impairment annually as of September 30th, or more often if events or circumstances, such as adverse changes in the business climate indicate there may be impairment. A goodwill\nimpairment test is performed by comparing the fair value of the reporting unit with its carrying value. An impairment charge is recorded for the amount by which the carrying amount exceeds the reporting unit’s fair value. For goodwill\nconsiderations the Company is a single reporting unit. A weighted average of both the market and income approaches is used in valuing the reporting unit’s fair value. Weightings are assigned to the approaches regarding fair value and the\nsensitivity of other weighting scenarios is considered. The market approach incorporates comparable public company information, valuation multiples and consideration of a market control premium along with data related to comparable observed\npurchase transactions in the financial services industry. The income approach consists of discounting projected future cash flows, which are derived from internal forecasts and economic expectations for the reporting unit. The significant\ninputs and assumptions for the income approach include projected earnings of the Company in future years for which there is inherent uncertainty and the discount rate. The sensitivity of a range of reasonable discount rates based on the current\neconomic environment is considered.\n\nThe Company engaged a third-party valuation specialist to\nperform its annual goodwill impairment test as of September 30, 2025. Based on the quantitative assessment, the fair value of the reporting unit was less than its carrying amount, resulting in a full impairment of goodwill. On October 15, 2025,\nmanagement, with oversight from the Audit Committee of the Board of Directors, concluded that the Company’s goodwill was fully impaired. Accordingly, the Company recorded a non-cash goodwill impairment charge of $25.9 million for the quarter ended September 30, 2025.\n\n \n\nCore deposit intangible assets arising from mergers and acquisitions are amortized on an accelerated basis reflecting the pattern in which the\neconomic benefits of the intangible asset are consumed or otherwise used up. The estimated life of the core deposit intangible is approximately 10\nyears.\n\nF-9\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nOffice Properties and Equipment\n\n \n\nLand is carried at cost. Premises and equipment are stated at cost less accumulated depreciation. Buildings and related components are depreciated using the\nstraight‑line method with useful lives ranging from 10 to 40 years. Furniture, fixtures, and equipment are depreciated using the straight‑line method with useful lives ranging from 3 to 10 years. Leasehold improvements are amortized over the\nlease term or the estimated useful life of the asset, whichever is shorter.\n\n \n\nFederal Home Loan Bank (FHLB) and Federal Reserve Bank (FRB) stock\n\n \n\nThe Bank is a member of the FHLB and FRB systems. Members are required to own a certain amount of stock based on the level of borrowings and other factors, and may\ninvest in additional amounts. FHLB and FRB stock are carried at cost, classified as restricted securities, and periodically evaluated for impairment based on ultimate recovery of their par value. Both cash and stock dividends are reported as\nincome when declared.\n\n \n\nBank‑Owned Life Insurance\n\n \n\nThe Bank has purchased life insurance policies on key executives and officers. Bank owned life insurance is recorded at the amount that can be realized under the\ninsurance contract at the balance sheet date, which is the cash surrender value adjusted for other charges or other amounts due that are probable at settlement.\n\n \n\nInvestment in Affordable Housing Limited Partnership\n\n \n\nThe Bank owns a less than 5% interest in an\naffordable housing limited partnership. The investment is recorded using the cost method and is being amortized over the life of the related tax credits. The tax credits are being recognized in income tax expense in the consolidated financial\nstatements to the extent they are utilized on the Company’s income tax returns. The investment is reviewed for impairment on an annual basis or on an interim basis if an event occurs that would trigger potential impairment.\n\n \n\nLoan Commitments and Related Financial Instruments\n\n \n\nFinancial instruments include off‑balance sheet credit instruments, such as commitments to make loans and commercial letters of credit, issued to meet customer\nfinancing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. Such financial instruments are recorded when they are funded.\n\n \n\nVariable Interest Entities (“VIE”)\n\nAn entity is considered to be a VIE when it\ndoes not have sufficient equity investment at risk, the equity investors as a group lack the characteristics of a controlling financial interest, or the entity is structured with disproportionate voting rights and substantially all of the\nentity’s activities are conducted on behalf of an investor with disproportionately few voting rights. The Company is required to consolidate a VIE when it holds a variable interest in the VIE and is also the primary beneficiary of the VIE.\n\nNoncontrolling Interests\n\nFor consolidated subsidiaries that are less than wholly-owned, the third-party holdings of equity interests\nare referred to as noncontrolling interests. The portion of net income attributable to noncontrolling interests for such subsidiaries is presented as net income applicable to noncontrolling interests on the consolidated statements of\noperations and comprehensive income, and the portion of the equity of such subsidiaries is presented as noncontrolling interests on the consolidated statements of financial condition and consolidated statements of changes in equity.\n\nRevenue Recognition\n\n \n\nASC 606, Revenue from Contracts with Customers (“ASC\n606”) establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts to provide goods or services to customers. The core principle of this standard\nrequires the Company to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as\nperformance obligations are satisfied. Most of our revenue‑generating transactions are not subject to ASC 606, including revenue generated from financial instruments, such as our loans and investment securities, as these activities are subject\nto other GAAP discussed elsewhere within our disclosures. The Company’s revenue stream that is within the scope of Topic 606 is primarily service charges on deposit accounts, which consist of monthly service fees, check orders, and other\ndeposit account related fees. The Company’s performance obligation for monthly service fees is generally satisfied, and the related revenue recognized, over the period in which the service is provided. Check orders and other deposit account\nrelated fees are largely transaction based, and therefore, the Company’s performance obligation is satisfied, and related revenue recognized, at a point in time. Payment for service charges on deposit accounts is primarily received immediately\nor in the following month through a direct charge to customers’ accounts.\n\n \n\nF-10\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nStock‑Based Compensation\n\n \n\nCompensation cost is recognized for stock options and restricted stock awards issued to employees and directors, based on the fair value of these awards at the date\nof grant. A Black‑Scholes model is utilized to estimate the fair value of stock options, while the market price of the Company’s common stock at the date of grant is used for restricted stock awards.\n\n \n\nCompensation cost is recognized over the required service period, generally defined as the vesting period. Compensation cost is recognized on a straight‑line basis\nover the requisite service period for the entire award. The Company’s accounting policy is to recognize forfeitures as they occur.\n\n \n\nIncome Taxes\n\n \n\nIncome tax expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Deferred tax assets and\nliabilities are the expected future tax amounts for the temporary differences between carrying amounts and tax bases of assets and liabilities, computed using enacted tax rates. A valuation allowance, if needed, reduces deferred tax assets to the\namount expected to be realized.\n\n \n\nA tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination\nbeing presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded.\n\n \n\nThe Company recognizes interest related to income tax matters in interest expense and penalties related to tax matters in income tax expense.\n\n \n\nRetirement Plans\n\n \n\nEmployee 401(k) expense is the amount of matching contributions made by the Company.\n\n \n\nEmployee Stock Ownership Plan (ESOP)\n\n \n\nThe cost of shares issued to the ESOP, but not yet allocated to participants, is shown as a reduction of equity. Compensation expense is based on the market price of\nshares as they are committed to be released to participant accounts. Dividends on allocated ESOP shares reduce retained earnings; dividends on unearned ESOP shares reduce debt and accrued interest.\n\n \n\nEarnings Per Common Share\n\n \n\nBasic earnings per share of common stock is computed pursuant to the two‑class method by dividing net income available to common stockholders less\ndividends paid on participating securities (unvested shares of restricted common stock) and any undistributed earnings attributable to participating securities by the weighted average common shares outstanding during the period. The weighted\naverage common shares outstanding includes the weighted average number of shares of common stock outstanding less the weighted average number of unvested shares of restricted common stock. ESOP shares are considered outstanding for this\ncalculation unless unearned. Diluted earnings per share of common stock includes the dilutive effect of unvested stock awards. It also includes the dilutive effect of additional potential common shares issuable under stock options using the\ntreasury method.\n\n \n\nComprehensive Income\n\n \n\nComprehensive income consists of the net income from operations and other comprehensive income. Other comprehensive income includes unrealized gains and losses on\nsecurities available‑for‑sale, net of tax, which are also recognized as separate components of equity.\n\n \n\nLoss Contingencies\n\n \n\nLoss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is\nprobable, and an amount or range of loss can be reasonably estimated. Management does not believe that any such matters existed as of the balance sheet date that will have a material effect on the consolidated financial statements.\n\n \n\nLeases\n\n \n\nThe Company determines if an arrangement is a lease at inception. Operating lease right-of-use (“ROU”) assets and operating lease liabilities are included in the\nCompany’s consolidated financial statements. ROU assets represent the Company’s right-of-use of an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments pursuant to the Company’s\nleases. The ROU assets and liabilities are recognized at commencement of the lease based on the present value of lease payments over the lease term. To determine the present value of lease payments, the Company uses its incremental borrowing\nrate. The lease term may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense is recognized on a straight-line basis over the lease term.\n\nF-11\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nFair Value Measurements\n\n \n\nFair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for\nthe asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:\n\n \n\nLevel 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.\n\n \n\nLevel 2: Significant observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not\nactive; or other inputs that are observable or can be corroborated by observable market data.\n\n \n\nLevel 3: Significant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or\nliability.\n\n \n\nFair values are estimated using relevant market information and other assumptions, as more fully disclosed in Note 9 “Fair Value.” Fair value\nestimates involve uncertainties and matters of significant judgment regarding interest rates, credit risk, prepayments, and other factors, especially in the absence of broad markets for particular items. Changes in assumptions or in market\nconditions could significantly affect the estimates.\n\n \n\nOperating Segments\n\n \n\nThe Company operates one reportable\nsegment — banking. The Company’s chief executive officer is its chief operating decision maker (“CODM”). The CODM assesses operating performance and manages the allocation of resources primarily based on the Company’s consolidated operating\nresults and financial condition. The factors considered in making this determination include all of the banking products and services offered by the Company are available in each branch of the Company, management does not allocate resources\nbased on the performance of different lending or transaction activities, and how information is reviewed by the chief executive officer and other key decision makers. The CODM uses consolidated net income to benchmark the Company against its\ncompetitors and to monitor budget to actual results.  As a result, the Company determined that all services offered relate to banking.  Loans, investments, and deposits provide the revenues in the banking operation.  Interest expense,\nprovisions for credit losses and payroll provide the significant expenses in the banking operation.  See the Company’s operating segment information in the consolidated statements of financial condition and the consolidated statements of\noperations and comprehensive income.\n\nTransfers and Servicing\n\nTo be eligible for sale accounting treatment, an entire financial asset, such as a loan, cannot be divided into components prior to the sale unless all of the components meet the definition of a participating\ninterest. A participating interest has all of the following characteristics: (a) it represents a proportionate ownership interest in the entire financial asset; (b) from the date of transfer, all cash flows received from the entire asset are\ndivided proportionately among the participating interest holders in an amount equal to their ownership percentage; (c) the priority of cash flows must be pari passu and no participating interest holder has any recourse to the other holders; and\n(d) no party can pledge or exchange the entire financial asset unless all participating interest holders agree.\n\nTransfers of financial assets (or\nparticipating interests in financial assets) are accounted for as sales when control over the assets has been relinquished. Control over transferred assets is deemed to be surrendered when the assets have been isolated from the Company, the\ntransferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and the Company does not maintain effective control over the transferred assets through an\nagreement to repurchase them before their maturity. The Company evaluates its loan sales and other financial asset transfers for sales treatment.\n\nTo the extent the transfer of assets (or\nparticipating interests in those assets) qualifies as a sale for accounting purposes, the Company derecognizes the asset and records the gain or loss on the sale date. In the event the Company determines that the transfer of assets does not\nqualify as a sale (or the portion of the asset sold does not qualify as a participating interest), the transfer is treated as a secured borrowing for accounting purposes until such date that the qualifications for sale accounting treatment are\nmet.\n\nAccounting Pronouncements Recently Issued\n\nIn November of 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2025-08 – Financial\nInstruments-Credit Losses (Topic 326): Purchased Loans. The amendments in this ASC expand the population of acquired financial assets subject to the “gross-up” approach in Accounting Standards Codification (“ASC”) Topic\n326. In accordance with this ASC, loans (excluding credit card loans) acquired without evidence of credit deterioration since their origination that are deemed to be “seasoned” (as defined in the Codification) are determined to be\n“purchased seasoned loans” and are to be accounted for using the gross-up approach at acquisition. Prior to this ASU, for loans that were not determined to be purchased credit deteriorated loans, GAAP required that an allowance\nfor credit losses be established for purchased loans through a provision for credit losses at the acquisition date. The gross-up approach allows an entity to record the acquisition-date allowance for credit losses for purchased\nseasoned loans through an offsetting addition to the amortized cost basis of the loan (rather than through the provision for credit losses). The ASU does not impact the accounting for loans that were acquired in periods prior to\nadoption of the ASU. The amendments in ASU 2025-08 will become effective for the Company in the first quarter of 2027; early adoption is permitted. The amendments in the ASU will not affect the Company’s accounting for loans in\nits portfolio on the date of adoption; however, loans acquired after the adoption date will be accounted for in accordance with the provisions of this ASU.\n\nIn December of 2025, the FASB issued ASU 2025-10 – Governments Grants (Topic 832): Accounting for Government Grants Received by Business Entities.\nPrior to the issuance of this ASU, GAAP did not provide authoritative guidance about the recognition, measurement, and presentation of a grant received by a business entity from a government. The amendments in this ASU establish the\naccounting for a government grant received by a business entity, including guidance for (1) a grant related to an asset and (2) a grant related to income. The newly issued guidance requires that a government grant received by a\nbusiness entity should not be recognized until: (1) it is probable that a business entity will comply with the conditions attached to the grant and that the grant will be received; and (2) a business entity meets the recognition\nguidance for a grant related to an asset or a grant related to income. The ASU also prescribes requirements for the subsequent income recognition, presentation matters, and financial statement disclosures related to government\ngrants. The guidance in this ASU will be effective for the Company beginning on January 1, 2029. Early adoption is permitted. The requirements in this ASU are similar to the guidance that the Company has been applying for accounting\nfor government grants by analogy to guidance issued by other accounting standard setters and authoritative bodies. The Company does not expect that the adoption of this guidance will materially impact its financial condition or\nresults of operations.\n\nIn December of 2025, the FASB issued ASU 2025-11 – Interim Reporting (Topic 270): Narrow-Scope Improvements. The amendments in this guidance clarify interim disclosure\nrequirements and the applicability of ASC 270 by providing a comprehensive list of interim period disclosures that are required by GAAP. The updates in ASU 2025-11 also include a disclosure principal that requires entities to\ndisclose events since the end of the last annual reporting period that have a material impact on the entity. The amendments in ASU 2025-11 will become effective for the Company for interim reporting periods beginning in the first\nquarter of 2028. Early adoption is permitted. The amendments in this ASU are not expected to have a material effect on the Company’s financial position or results of operations; however, the required disclosures will be added to the\nCompany’s interim financial statements issued after the effective date.\n\nF-12\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nNote 2 – Capital\n\nSeries C, Senior Non-Cumulative Perpetual Preferred Stock\n\nOn June 7, 2022, the Company issued 150,000 shares of Series C Preferred Stock with a liquidation preference of $1,000\nper share for the capital investment of $150 million from the U.S. Treasury under the Emergency Capital Investment Program\n(“ECIP”).\n\nThe Series C Preferred Stock accrued no dividend for the first 24 months following the investment date. Thereafter, the dividend rate will be adjusted based on the qualified lending growth criteria listed in\nthe terms of the ECIP investment with the annual dividend rate up to 2%. After the tenth anniversary of the investment date, the dividend rate will be fixed based on the average annual amount of lending in years 2 through 10. Dividends are payable quarterly in arrears\non March 15, June 15, September 15, and December 15.\n\nEstablished by the Consolidated Appropriations Act, 2021, the ECIP was created to encourage low- and moderate-income community financial\ninstitutions and minority depository institutions to provide loans, grants, and forbearance for small businesses, minority-owned businesses, and consumers, especially low-income and underserved communities, including persistent poverty\ncounties, that may be disproportionately impacted by the economic effect of the COVID-19 pandemic by providing direct and indirect capital investments in low- and moderate-income community financial institutions.\n\nThe Series C Preferred Stock may be redeemed at the option of the Company on or after the fifth anniversary of issuance (or earlier in the event of loss of regulatory capital treatment), subject to the approval of the appropriate federal banking regulator and in\naccordance with the federal banking agencies’ regulatory capital regulations.\n\nOn January 14, 2025, the Company entered into a Securities\nPurchase Option Agreement (the “Option Agreement”) with the U.S. Treasury, which grants the Company the conditional option to repurchase the Series C Preferred Stock during the first 15 years following the Company’s issuance of the Preferred Stock. The purchase price for the Series C Preferred Stock under the Option Agreement is based on a formula approximate to the fair value of the Series C Preferred Stock as of the date the Option Agreement is executed,\ncalculated as set forth in the Option Agreement, together with any accrued and unpaid dividends thereon and could represent a discount from the Preferred Stock’s liquidation amount.\n\nThe purchase option may not be exercised during the first\n10 years following the Company’s sale of the Series C Preferred Stock (“ECIP Period”) unless and until the Company meets at least\none of the following three conditions (the “Threshold Conditions”): (1) an average of at least 60% of the Company’s loan\noriginations qualify as “Deep Impact Lending” over any 16 consecutive quarters, (2) an average of at least 85% of the Company’s “total originations qualify as “Qualified Lending” over any 24 quarters or (3) the Series C Preferred Stock has a dividend rate of no more than 0.5%\nat each of six consecutive “Reset Dates,” in each case as defined in the Option Agreement and the terms of the Series C Preferred\nStock. In addition to satisfying a Threshold Condition, the Option Agreement requires that the Company meet certain other eligibility conditions in order to exercise the purchase option in the future, including compliance with the terms of\nthe original ECIP purchase agreement and the terms of the Series C Preferred Stock, maintaining qualification as either a certified community development financial institution or a minority depository institution and satisfying other legal\nand regulatory criteria. The Company may designate a mission aligned nonprofit affiliate as the purchaser of the Series C Preferred Stock under the terms of the Option\nAgreement.\n\nThe earliest possible date by which a Threshold Condition may be met is June 30, 2028, which is the end of the sixteenth consecutive quarter following the Original Closing Date. However, the Company does not currently meet any of the Threshold Conditions to\nexercise the purchase option, and there can be no assurance if and when the Threshold Conditions will be met.\n\nIn addition to the requirement that a Threshold Condition be met, the Repurchase Agreement requires that the Company meet certain other\neligibility conditions in order to exercise the purchase option in the future, including compliance with the terms of the original ECIP purchase agreement and the terms of the Preferred Stock, maintaining qualification as either a CDFI or an\nMDI, and meeting other legal and regulatory criteria. Although the Company currently meets the general eligibility criteria, other than satisfying one of the Threshold Conditions, there can be no assurance that the Company will meet such\ncriteria in the future.\n\nThe Company was required to begin paying quarterly\ndividends on the Series C Preferred Stock in the three month period ended June 30, 2024. Dividends on the Series C Preferred Stock totaled $3.0 million and $1.6 million for\nthe years ended December 31, 2025 and 2024, respectively, with a dividend rate of 2.0%.\n\nF-13\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nNote 3 – Securities\n\n \n\nThe following table summarizes the amortized cost and fair value of the available‑for‑sale investment securities portfolios at December 31, 2025 and December 31,\n2024 and the corresponding amounts of unrealized gains (losses) which are recognized in accumulated other comprehensive income (loss):\n\n \n\n \n\n \n\nAmortized\n\nCost\n\n \n\n \n\nGross\n\nUnrealized\n\nGains\n\n \n\n \n\nGross\n\nUnrealized\n\nLosses\n\n \n\n \n\nFair Value\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nDecember 31, 2025:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFederal agency mortgage-backed securities\n\n \n\n$\n\n120,372\n\n \n\n \n\n$\n\n1,109\n\n \n\n \n\n$\n\n(7,051\n\n)\n\n \n\n$\n\n114,430\n\n \n\nFederal agency Collateralized Mortgage Obligations (CMOs)\n\n \n\n \n\n69,742\n\n \n\n \n\n \n\n367\n\n \n\n \n\n \n\n(652\n\n)\n\n \n\n \n\n69,457\n\n \n\nFederal agency debt\n\n \n\n \n\n29,259\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(846\n\n)\n\n \n\n \n\n28,413\n\n \n\nMunicipal bonds\n\n \n\n \n\n4,766\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(244\n\n)\n\n \n\n \n\n4,522\n\n \n\nU. S. Treasuries\n\n \n\n \n\n4,993\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(6\n\n)\n\n \n\n \n\n4,987\n\n \n\nSBA pools\n\n \n\n \n\n9,387\n\n \n\n \n\n \n\n3\n\n \n\n \n\n \n\n(1,115\n\n)\n\n \n\n \n\n8,275\n\n \n\n   Asset-backed securities\n\n \n\n \n\n9,352\n\n \n\n \n\n \n\n3\n\n \n\n \n\n \n\n(86\n\n)\n\n \n\n \n\n9,269\n\n \n\n   Corporate bonds\n\n \n\n \n\n17,500\n\n \n\n \n\n \n\n57\n\n \n\n \n\n \n\n(75\n\n)\n\n \n\n \n\n17,482\n\n \n\nTotal available-for-sale securities\n\n \n\n$\n\n265,371\n\n \n\n \n\n$\n\n1,539\n\n \n\n \n\n$\n\n(10,075\n\n)\n\n \n\n$\n\n256,835\n\n \n\nDecember 31, 2024:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFederal agency mortgage-backed securities\n\n \n\n$\n\n62,853\n\n \n\n \n\n$\n\n8\n\n \n\n \n\n$\n\n(9,832\n\n)\n\n \n\n$\n\n53,029\n\n \n\nFederal agency CMOs\n\n \n\n \n\n21,299\n\n \n\n \n\n \n\n6\n\n \n\n \n\n \n\n(1,247\n\n)\n\n \n\n \n\n20,058\n\n \n\nFederal agency debt\n\n \n\n \n\n42,100\n\n \n\n \n\n \n\n2\n\n \n\n \n\n \n\n(2,068\n\n)\n\n \n\n \n\n40,034\n\n \n\nMunicipal bonds\n\n \n\n \n\n4,800\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(412\n\n)\n\n \n\n \n\n4,388\n\n \n\nU. S. Treasuries\n\n \n\n \n\n77,857\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(667\n\n)\n\n \n\n \n\n77,190\n\n \n\nSBA pools\n\n \n\n \n\n10,749\n\n \n\n \n\n \n\n2\n\n \n\n \n\n \n\n(1,588\n\n)\n\n \n\n \n\n9,163\n\n \n\nTotal available-for-sale securities\n\n \n\n$\n\n219,658\n\n \n\n \n\n$\n\n18\n\n \n\n \n\n$\n\n(15,814\n\n)\n\n \n\n$\n\n203,862\n\n \n\n \n\nThere were no sales of securities during the\nyears ended December 31, 2025 or 2024.\n\nThe amortized cost and estimated fair value of all investment securities available-for-sale at December 31, 2025, by contractual maturities, are shown below.\nContractual maturities may differ from expected maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.\n\n \n\n \n\nAmortized\n\nCost\n\n \n\n \n\nGross\n\n Unrealized\n\nGains\n\n \n\n \n\nGross\n\nUnrealized\n\nLosses\n\n \n\n \n\nFair Value\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nDue in one year or less\n\n \n\n$\n\n11,863\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n(47\n\n)\n\n \n\n$\n\n11,816\n\n \n\nDue after one year through five years\n\n \n\n \n\n28,280\n\n \n\n \n\n \n\n4\n\n \n\n \n\n \n\n(1,049\n\n)\n\n \n\n \n\n27,235\n\n \n\nDue after five years through ten years\n\n \n\n \n\n32,230\n\n \n\n \n\n \n\n52\n\n \n\n \n\n \n\n(741\n\n)\n\n \n\n \n\n31,541\n\n \n\nDue after ten years\n\n \n\n \n\n192,998\n\n \n\n \n\n \n\n1,483\n\n \n\n \n\n \n\n(8,238\n\n)\n\n \n\n \n\n186,243\n\n \n\n \n\n \n\n$\n\n265,371\n\n \n\n \n\n$\n\n1,539\n\n \n\n \n\n$\n\n(10,075\n\n)\n\n \n\n$\n\n256,835\n\n \n\nThe table below indicates the length of time individual securities have been in a continuous unrealized loss position:\n\n \n\nLess than 12 Months\n\n \n\n \n\n12 Months or Longer\n\n \n\n \n\nTotal\n\n \n\n \n\n \n\nFair Value\n\n \n\n \n\nUnrealized\n\nLosses\n\n \n\n \n\nFair Value\n\n \n\n \n\nUnrealized\n\nLosses\n\n \n\n \n\nFair Value\n\n \n\n \n\nUnrealized\n\nLosses\n\n \n\nDecember 31, 2025:\n\n \n\n(In thousands)\n\n \n\nFederal agency mortgage-backed securities\n\n \n\n$\n\n7,197\n\n \n\n \n\n$\n\n(26\n\n)\n\n \n\n$\n\n47,717\n\n \n\n \n\n$\n\n(7,025\n\n)\n\n \n\n$\n\n54,914\n\n \n\n \n\n$\n\n(7,051\n\n)\n\nFederal agency CMOs\n\n \n\n \n\n1,488\n\n \n\n \n\n \n\n(2\n\n)\n\n \n\n \n\n14,804\n\n \n\n \n\n \n\n(650\n\n)\n\n \n\n \n\n16,292\n\n \n\n \n\n \n\n(652\n\n)\n\nFederal agency debt\n\n \n\n \n\n2,512\n\n \n\n \n\n \n\n(3\n\n)\n\n \n\n \n\n25,901\n\n \n\n \n\n \n\n(843\n\n)\n\n \n\n \n\n28,413\n\n \n\n \n\n \n\n(846\n\n)\n\nMunicipal bonds\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,522\n\n \n\n \n\n \n\n(244\n\n)\n\n \n\n \n\n4,522\n\n \n\n \n\n \n\n(244\n\n)\n\nU. S. Treasuries\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,987\n\n \n\n \n\n \n\n(6\n\n)\n\n \n\n \n\n4,987\n\n \n\n \n\n \n\n(6\n\n)\n\nSBA pools\n\n \n\n \n\n185\n\n \n\n \n\n \n\n(1\n\n)\n\n \n\n \n\n7,621\n\n \n\n \n\n \n\n(1,114\n\n)\n\n \n\n \n\n7,806\n\n \n\n \n\n \n\n(1,115\n\n)\n\n    Asset-backed securities\n\n \n\n \n\n7,208\n\n \n\n \n\n \n\n(86\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n7,208\n\n \n\n \n\n \n\n(86\n\n)\n\n    Corporate bonds\n\n \n\n \n\n7,425\n\n \n\n \n\n \n\n(75\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n7,425\n\n \n\n \n\n \n\n(75\n\n)\n\nTotal\n\n \n\n$\n\n26,015\n\n \n\n \n\n$\n\n(193\n\n)\n\n \n\n$\n\n105,552\n\n \n\n \n\n$\n\n(9,882\n\n)\n\n \n\n$\n\n131,567\n\n \n\n \n\n$\n\n(10,075\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDecember 31, 2024:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFederal agency mortgage-backed securities\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n52,568\n\n \n\n \n\n$\n\n(9,832\n\n)\n\n \n\n$\n\n52,568\n\n \n\n \n\n$\n\n(9,832\n\n)\n\nFederal agency CMOs\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n19,303\n\n \n\n \n\n \n\n(1,247\n\n)\n\n \n\n \n\n19,303\n\n \n\n \n\n \n\n(1,247\n\n)\n\nFederal agency debt\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n37,508\n\n \n\n \n\n \n\n(2,068\n\n)\n\n \n\n \n\n37,508\n\n \n\n \n\n \n\n(2,068\n\n)\n\nMunicipal bonds\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,388\n\n \n\n \n\n \n\n(412\n\n)\n\n \n\n \n\n4,388\n\n \n\n \n\n \n\n(412\n\n)\n\nU. S. Treasuries\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n77,190\n\n \n\n \n\n \n\n(667\n\n)\n\n \n\n \n\n77,190\n\n \n\n \n\n \n\n(667\n\n)\n\nSBA pools\n\n \n\n \n\n629\n\n \n\n \n\n \n\n(1\n\n)\n\n \n\n \n\n8,179\n\n \n\n \n\n \n\n(1,587\n\n)\n\n \n\n \n\n8,808\n\n \n\n \n\n \n\n(1,588\n\n)\n\nTotal\n\n \n\n$\n\n629\n\n \n\n \n\n$\n\n(1\n\n)\n\n \n\n$\n\n199,136\n\n \n\n \n\n$\n\n(15,813\n\n)\n\n \n\n$\n\n199,765\n\n \n\n \n\n$\n\n(15,814\n\n)\n\nSecurities with a market value of $83.7 million were pledged as collateral for securities sold under agreements to repurchase as of December 31, 2025 and included $67.9 million of federal agency mortgage-backed securities, $9.3 million of federal agency debt, $5.0 million of U.S. Treasuries,\nand $1.5 million of SBA pools. Securities with a market value of $7.7 million were pledged as collateral for D.C. Housing, securities with a market value of $4.2 million were pledged as collateral for D.C. Government, and securities with a market value of $157 thousand were pledged as collateral for FRB discount window.\n\nSecurities with a market value of $83.3 million were pledged as collateral for securities sold under agreements to repurchase as of December 31, 2024 and included $46.5 million of U.S. Treasuries, $27.1\nmillion of federal agency debt, $5.5 million of federal agency mortgage-backed securities, and $4.2 million of SBA pools.\n\nAt\nDecember 31, 2025 and 2024, there were no securities pledged to secure public deposits since those public deposits are under\n$250 thousand which are fully insured by FDIC. At December 31, 2025 and 2024, there were no holdings of securities by any\none issuer, other than the U.S. Government and its agencies, in an amount greater than 10% of equity.  Accrued interest receivable on securities was $745 thousand and $796 thousand at December 31, 2025 and 2024, respectively, and is included in\nthe consolidated statements of financial condition in accrued interest receivable.\n\nAt December 31, 2025 and 2024, there were no\nsecurities in nonaccrual status.  All securities in the portfolio were current with their contractual principal and interest payments.  At December 31, 2025 and 2024, there were no securities purchased with deterioration in credit quality since their origination, and there were no collateral dependent securities.\n\nF-14\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nNote 4 – Loans Receivable Held for Investment\n\n \n\nLoans receivable held for investment were as follows as of the periods indicated:\n\n \n\n \n\n \n\nDecember 31,\n\n2025\n\n \n\n \n\nDecember 31,\n\n2024\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nReal estate:\n\n \n\n \n\n \n\n \n\n \n\n \n\nSingle-family\n\n \n\n$\n\n20,607\n\n \n\n \n\n$\n\n24,036\n\n \n\nMulti-family\n\n \n\n \n\n593,187\n\n \n\n \n\n \n\n639,156\n\n \n\nCommercial real estate\n\n \n\n \n\n162,618\n\n \n\n \n\n \n\n163,348\n\n \n\nChurch\n\n \n\n \n\n9,015\n\n \n\n \n\n \n\n9,470\n\n \n\nConstruction\n\n \n\n \n\n72,979\n\n \n\n \n\n \n\n91,600\n\n \n\nCommercial – other\n\n \n\n \n\n140,019\n\n \n\n \n\n \n\n77,787\n\n \n\nSBA loans\n\n \n\n \n\n17,067\n\n \n\n \n\n \n\n1,142\n\n \n\nConsumer\n\n \n\n \n\n38\n\n \n\n \n\n \n\n13\n\n \n\nGross loans receivable before deferred loan costs and premiums\n\n \n\n \n\n1,015,530\n\n \n\n \n\n \n\n1,006,552\n\n \n\nUnamortized net deferred loan costs and premiums\n\n \n\n \n\n10,529\n\n \n\n \n\n \n\n2,116\n\n \n\n \n\n \n\n \n\n1,026,059\n\n \n\n \n\n \n\n1,008,668\n\n \n\nCredit and interest marks on purchased loans, net\n\n \n\n \n\n(95\n\n)\n\n \n\n \n\n(348\n\n)\n\nAllowance for credit losses\n\n \n\n \n\n(9,424\n\n)\n\n \n\n \n\n(8,364\n\n)\n\nLoans receivable, net\n\n \n\n$\n\n1,016,540\n\n \n\n \n\n$\n\n999,956\n\n \n\n \n\nThe following tables summarize the activity in the allowance for credit losses on loans for the periods indicated:\n\n \n\n \n\nFor the Year Ended December 31, 2025\n\n \n\n \n\n \n\nBeginning\n\nBalance\n\n \n\n \n\nCharge-offs\n\n \n\n \n\nRecoveries\n\n \n\n \n\nProvision\n\n(Recapture)\n\n \n\n \n\nEnding\n\nBalance\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nReal estate:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSingle-family\n\n \n\n$\n\n200\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n(68\n\n)\n\n \n\n$\n\n132\n\n \n\nMulti-family\n\n \n\n \n\n4,617\n\n \n\n \n\n \n\n(1,143\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,308\n\n \n\n \n\n \n\n4,782\n\n \n\nCommercial real estate\n\n \n\n \n\n1,188\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n5\n\n \n\n \n\n \n\n1,193\n\n \n\nChurch\n\n \n\n \n\n54\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(18\n\n)\n\n \n\n \n\n36\n\n \n\nConstruction\n\n \n\n \n\n1,564\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n475\n\n \n\n \n\n \n\n2,039\n\n \n\nCommercial - other\n\n \n\n \n\n730\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n170\n\n \n\n \n\n \n\n900\n\n \n\nSBA loans\n\n \n\n \n\n11\n\n \n\n \n\n \n\n(36\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n367\n\n \n\n \n\n \n\n342\n\n \n\nConsumer\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nTotal\n\n \n\n$\n\n8,364\n\n \n\n \n\n$\n\n(1,179\n\n)\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n2,239\n\n \n\n \n\n$\n\n9,424\n\n \n\n \n\n \n\nFor the Year Ended December 31, 2024\n\n \n\n \n\n \n\nBeginning\n\nBalance\n\n \n\n \n\nImpact of CECL\n\nAdoption\n\n \n\n \n\nCharge-offs\n\n \n\n \n\nRecoveries\n\n \n\n \n\nProvision\n\n(Recapture)\n\n \n\n \n\nEnding\n\nBalance\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nReal estate:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSingle-family\n\n \n\n$\n\n264\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n(64\n\n)\n\n \n\n$\n\n200\n\n \n\nMulti-family\n\n \n\n \n\n4,464\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n153\n\n \n\n \n\n \n\n4,617\n\n \n\nCommercial real estate\n\n \n\n \n\n1,164\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n24\n\n \n\n \n\n \n\n1,188\n\n \n\nChurch\n\n \n\n \n\n72\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(18\n\n)\n\n \n\n \n\n54\n\n \n\nConstruction\n\n \n\n \n\n1,009\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n555\n\n \n\n \n\n \n\n1,564\n\n \n\nCommercial - other\n\n \n\n \n\n592\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n138\n\n \n\n \n\n \n\n730\n\n \n\nSBA loans\n\n \n\n \n\n48\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(37\n\n)\n\n \n\n \n\n11\n\n \n\nConsumer\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nTotal\n\n \n\n$\n\n7,613\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n751\n\n \n\n \n\n$\n\n8,364\n\n \n\nThe Company also recorded a\nrecovery of provision for off-balance sheet loan commitments of $53 thousand and $91 thousand for the years ended December 31, 2025 and 2024, respectively.\n\nThe ACL increased to $9.4 million as of December 31, 2025, compared to $8.4 million as of December 31, 2024, primarily due to  an increase in specific reserves on collateral dependent loans.\n\nThe Company evaluates loans collectively for purposes of determining the ACL. Collective evaluation is based on aggregating loans deemed to possess similar risk characteristics. In certain\ninstances, the Company may identify loans that it believes no longer possess risk characteristics similar to other loans in the loan portfolio. These loans are typically identified from those that have exhibited deterioration in credit quality,\nsince the specific attributes and risks associated with such loans tend to become unique as the credit deteriorates. Such loans are typically nonperforming, downgraded to substandard or worse, and/or are deemed collateral dependent, where the\nultimate repayment of the loan is expected to come from the operation of or eventual sale of the collateral. Loans that are deemed by management to no longer possess risk characteristics similar to other loans in the portfolio, or that have\nbeen identified as collateral dependent, are evaluated individually for purposes of determining an appropriate lifetime ACL. The Company uses the remaining life approach, using the loan’s effective interest rate, for determining the ACL on\nindividually evaluated loans, unless the loan is deemed collateral dependent, which requires evaluation based on the estimated fair value of the underlying collateral, less estimated selling costs. The Company may increase or decrease the ACL\nfor collateral dependent loans based on changes in the estimated fair value of the collateral.\n\nF-15\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nThe following tables present collateral dependent loans by collateral type as of the date indicated:\n\n \n\n \n\nDecember 31, 2025\n\n \n\n \n\n \n\nSingle-Family\n\n \n\n \n\nMulti-Family\n\nResidential\n\n \n\n \n\nChurch\n\n \n\n \n\nBusiness\n\nAssets\n\n \n\n \n\nTotal\n\n \n\nReal estate:\n\n \n\n(In thousands)\n\n \n\nSingle-family\n\n \n\n424\n\n \n\n \n\n–\n\n \n\n \n\n–\n\n \n\n \n\n–\n\n \n\n \n\n424\n\n \n\nMulti-family\n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,094\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,094\n\n \n\nConstruction\n\n \n\n \n\n–\n\n \n\n \n\n \n\n8,168\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n8,168\n\n \n\nCommercial – other\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n261\n\n \n\n \n\n \n\n261\n\n \n\nTotal\n\n \n\n$\n\n424\n\n \n\n \n\n$\n\n10,262\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n261\n\n \n\n \n\n$\n\n10,947\n\n \n\n \n\n \n\nDecember 31, 2024\n\n \n\n \n\n \n\nSingle-Family\n\n \n\n \n\nMulti-Family\n\nResidential\n\n \n\n \n\nChurch\n\n \n\n \n\nBusiness\n\nAssets\n\n \n\n \n\nTotal\n\n \n\nReal estate:\n\n \n\n(In thousands)\n\n \n\nCommercial – other\n\n \n\n \n\n264\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n264\n\n \n\nTotal\n\n \n\n$\n\n264\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n264\n\n \n\nAt December 31, 2025, $10.9 million of individually evaluated loans were evaluated based on the estimated fair value of the underlying collateral. These loans had an\nassociated ACL of $1.1 million as of December 31, 2025. All of these collateral dependent loans were on nonaccrual status at\nDecember 31, 2025.\n\n \n\nAt December 31, 2024, one $264 thousand individually\nevaluated loan was evaluated based on the estimated fair value  of the underlying collateral.   This loan had no associated ACL\nas of December 31, 2024 and was on nonaccrual status.\n\n \n\nPast Due Loans\n\n \n\nThe following tables present the aging of the recorded investment in past due loans by loan type as of the dates indicated:\n\n \n\n \n\n \n\nDecember 31, 2025\n\n \n\n \n\n \n\n30‑59\n\nDays\n\nPast Due\n\n \n\n \n\n60‑89\n\nDays\n\nPast Due\n\n \n\n \n\nGreater than\n\n90 Days\n\nPast Due\n\n \n\n \n\nTotal\n\nPast Due\n\n \n\n \n\nCurrent\n\n \n\n \n\nTotal\n\n \n\n \n\n \n\n(In thousands)\n\n \n\n \n\n \n\n \n\nLoans receivable held for investment:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nReal estate:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSingle-family\n\n \n\n$\n\n133\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n424\n\n \n\n \n\n$\n\n557\n\n \n\n \n\n$\n\n20,070\n\n \n\n \n\n$\n\n20,627\n\n \n\nMulti-family\n\n \n\n \n\n6,162\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,094\n\n \n\n \n\n \n\n8,256\n\n \n\n \n\n \n\n587,535\n\n \n\n \n\n \n\n595,791\n\n \n\nCommercial real estate\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n162,445\n\n \n\n \n\n \n\n162,445\n\n \n\nChurch\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n9,024\n\n \n\n \n\n \n\n9,024\n\n \n\nConstruction\n\n \n\n \n\n5,533\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n5,533\n\n \n\n \n\n \n\n67,139\n\n \n\n \n\n \n\n72,672\n\n \n\nCommercial - other\n\n \n\n \n\n–\n\n \n\n \n\n \n\n367\n\n \n\n \n\n \n\n261\n\n \n\n \n\n \n\n628\n\n \n\n \n\n \n\n146,366\n\n \n\n \n\n \n\n146,994\n\n \n\nSBA loans\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n222\n\n \n\n \n\n \n\n222\n\n \n\n \n\n \n\n18,246\n\n \n\n \n\n \n\n18,468\n\n \n\nConsumer\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n38\n\n \n\n \n\n \n\n38\n\n \n\nTotal\n\n \n\n$\n\n11,828\n\n \n\n \n\n$\n\n367\n\n \n\n \n\n$\n\n3,001\n\n \n\n \n\n$\n\n15,196\n\n \n\n \n\n$\n\n1,010,863\n\n \n\n \n\n$\n\n1,026,059\n\n \n\n \n\n \n\nDecember 31, 2024\n\n \n\n \n\n \n\n30‑59\n\nDays\n\nPast Due\n\n \n\n \n\n60‑89\n\nDays\n\nPast Due\n\n \n\n \n\nGreater than\n\n90 Days\n\nPast Due\n\n \n\n \n\nTotal\n\nPast Due\n\n \n\n \n\nCurrent\n\n \n\n \n\nTotal\n\n \n\n \n\n \n\n(In thousands)\n\n \n\n \n\n \n\n \n\nLoans receivable held for investment:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nReal estate:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSingle-family\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n6\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n6\n\n \n\n \n\n$\n\n24,042\n\n \n\n \n\n$\n\n24,048\n\n \n\nMulti-family\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n642,109\n\n \n\n \n\n \n\n642,109\n\n \n\nCommercial real estate\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n163,269\n\n \n\n \n\n \n\n163,269\n\n \n\nChurch\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n9,475\n\n \n\n \n\n \n\n9,475\n\n \n\nConstruction\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n91,140\n\n \n\n \n\n \n\n91,140\n\n \n\nCommercial - other\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n77,472\n\n \n\n \n\n \n\n77,472\n\n \n\nSBA loans\n\n \n\n \n\n–\n\n \n\n \n\n \n\n264\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n264\n\n \n\n \n\n \n\n878\n\n \n\n \n\n \n\n1,142\n\n \n\nConsumer\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n13\n\n \n\n \n\n \n\n13\n\n \n\nTotal\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n270\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n270\n\n \n\n \n\n$\n\n1,008,398\n\n \n\n \n\n$\n\n1,008,668\n\n \n\n \n\nThe following tables present the recorded investment in non‑accrual loans by loan type as of the period indicated:\n\nDecember 31, 2025\n\n \n\nNonaccrual\n\nwith no\n\nAllowance for\n\nCredit Losses\n\n \n\n \n\nNonaccrual\n\nwith an\n\nAllowance\n\nfor Credit\n\nLosses\n\n \n\n \n\nTotal\n\nNonaccrual\n\nLoans\n\n \n\nLoans receivable held for investment:\n\n \n\n \n\n \n\n \n\n(In thousands)\n\n \n\nReal Estate:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSingle-family\n\n \n\n$\n\n424\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n424\n\n \n\nMulti-family\n\n \n\n \n\n2,094\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,094\n\n \n\nConstruction\n\n \n\n \n\n–\n\n \n\n \n\n \n\n8,168\n\n \n\n \n\n \n\n8,168\n\n \n\nCommercial - other\n\n \n\n \n\n261\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n261\n\n \n\nSBA loans\n\n \n\n–\n\n \n\n \n\n222\n\n \n\n \n\n222\n\n \n\nTotal non-accrual loans\n\n \n\n$\n\n2,779\n\n \n\n \n\n$\n\n8,390\n\n \n\n \n\n$\n\n11,169\n\n \n\nF-16\n\n[Table of Contents](#TABLEOFCONTENTS)\n\n \n\nDecember 31, 2024\n\n \n\nNonaccrual\n\nwith no\n\nAllowance for\n\nCredit Losses\n\n \n\nNonaccrual\n\nwith an\n\nAllowance\n\nfor Credit\n\nLosses\n\n \n\n \n\nTotal\n\nNonaccrual\n\nLoans\n\n \n\nLoans receivable held for investment:\n\n \n\n \n\n \n\n(In thousands)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSBA loans\n\n \n\n$\n\n264\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n264\n\n \n\nTotal non-accrual loans\n\n \n\n$\n\n264\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n264\n\n \n\nThe Company recognized $82 thousand of interest income\non nonaccrual loans during the year ended December 31,2025. There were no loans 90 days or more delinquent that were accruing\ninterest as of December 31, 2025 or December 31, 2024.\n\nModified Loans to Troubled Borrowers\n\nGAAP requires that certain types of\nmodifications of loans in response to a borrower’s financial difficulty be reported, which consist of the following: (i) principal forgiveness, (ii) interest rate reduction, (iii) other-than-insignificant payment delay, (iv) term extension, or\n(v) any combination of the foregoing. The ACL for loans that were modified in response to a borrower’s financial difficulty is measured on a collective basis, as with other loans in the loan portfolio, unless management determines that such\nloans no longer possess risk characteristics similar to others in the loan portfolio. In those instances, the ACL for such loans is determined through individual evaluation.\n\n \n\nThe following table presents the amortized costs basis as of December 31, 2025 and 2024 and the financial effect of loans modified to borrowers experiencing\nfinancial difficulty during the years ended December 31, 2025 and 2024.\n\n \n\nDecember 31, 2025\n\n \n\nTerm Extension\n\n \n\nPercentage\n\nof Total\n\nLoan Type\n\n \n\nWeighted\n\nAverage\n\nTerm\n\nExtension\n\n \n\n(In Thousands)\n\nReal estate:\n\n \n\n \n\n \n\n \n\n   \n\nCommercial real estate\n\n \n\n$\n\n772\n\n \n\n \n\n \n\n0.47\n\n%\n\n8 months\n\nConstruction\n\n \n\n \n\n1,999\n\n \n\n \n\n \n\n2.73\n\n%\n\n8 months\n\nCommercial - other\n\n \n\n \n\n367\n\n \n\n \n\n \n\n0.26\n\n%\n\n9 months\n\nTotal\n\n \n\n$\n\n3,138\n\n \n\n \n\n \n\n \n\n \n\n   \n\n \n\nDecember 31, 2024\n\n \n\nTerm Extension\n\n \n\nPercentage\n\nof Total\n\nLoan Type\n\n \n\nWeighted\n\nAverage\n\nTerm\n\nExtension\n\n \n\n(In Thousands)\n\nReal estate:\n\n \n\n \n\n \n\n \n\n   \n\nCommercial real estate\n\n \n\n$\n\n792\n\n \n\n \n\n \n\n0.51\n\n%\n\n12 months\n\nConstruction\n\n \n\n \n\n4,559\n\n \n\n \n\n \n\n5.66\n\n%\n\n17 months\n\nCommercial - other\n\n \n\n \n\n572\n\n \n\n \n\n \n\n1.28\n\n%\n\n14 months\n\nTotal\n\n \n\n$\n\n5,923\n\n \n\n \n\n \n\n \n\n \n\n   \n\nCredit\nQuality Indicators\n\n \n\nThe Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial\ninformation, historical payment experience, credit documentation, public information, and current economic trends, among other factors. For single-family residential, consumer and other smaller balance homogenous loans, a credit grade is\nestablished at inception, and generally only adjusted based on performance. Information about payment status is disclosed elsewhere herein. The Company analyzes all other loans individually by classifying the loans as to credit risk. This\nanalysis is performed at least on an annual basis. The Company uses the following definitions for risk ratings:\n\n \n\n●\n\nWatch. Loans classified as watch exhibit weaknesses that could threaten the current net worth and paying capacity of the obligors. Watch graded loans are generally performing\nand are not more than 59 days past due. A watch rating is used when a material deficiency exists, but correction is anticipated within an acceptable time frame.\n\n \n\n●\n\nSpecial Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention that appears short-term in nature. If left\nuncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.\n\n \n\n●\n\nSubstandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans\nso classified have a well‑defined weakness or weaknesses that jeopardizes the liquidation of the debt. They are characterized by the distinct possibility that the institution may sustain some loss if the deficiencies are not corrected.\n\n \n\n●\n\nDoubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection\nor liquidation in full, based on currently existing facts, conditions, and values, highly questionable and improbable.\n\n \n\n●\n\nLoss. Loans classified as loss are considered uncollectible and of such little value that to continue to carry the loan as an active asset is no longer warranted.\n\n \n\nLoans not meeting the criteria above that are analyzed individually as part of the above-described process are considered to be pass rated loans. Pass rated loans\nare generally well protected by the current net worth and paying capacity of the obligor and/or by the value of the underlying collateral. Pass rated loans are not more than 59 days past due and are generally performing in accordance with the\nloan terms.\n\nF-17\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nThe following table stratifies the loans held for investment portfolio by the Company’s internal risk grading, and by year of origination as\nof the date indicated:\n\n \n\n \n\nTerm Loans Amortized Cost Basis by Origination Year - As of December 31, 2025\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n2023\n\n \n\n \n\n2022\n\n \n\n \n\n2021\n\n \n\n \n\nPrior\n\n \n\n \n\nRevolving\n\nLoans\n\n \n\n \n\nTotal\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nSingle-family:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n533\n\n \n\n \n\n$\n\n2,785\n\n \n\n \n\n$\n\n2,464\n\n \n\n \n\n$\n\n12,806\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n18,588\n\n \n\nWatch\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n867\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n867\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,172\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,172\n\n \n\nTotal\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n533\n\n \n\n \n\n$\n\n3,957\n\n \n\n \n\n$\n\n2,464\n\n \n\n \n\n$\n\n13,673\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n20,627\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nMulti-family:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n2,519\n\n \n\n \n\n$\n\n63,728\n\n \n\n \n\n$\n\n64,468\n\n \n\n \n\n$\n\n164,533\n\n \n\n \n\n$\n\n122,938\n\n \n\n \n\n$\n\n82,514\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n500,700\n\n \n\nWatch\n\n \n\n \n\n–\n\n \n\n \n\n \n\n13,169\n\n \n\n \n\n \n\n16,343\n\n \n\n \n\n \n\n14,299\n\n \n\n \n\n \n\n9,979\n\n \n\n \n\n \n\n23,162\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n76,952\n\n \n\nSpecial Mention\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,774\n\n \n\n \n\n \n\n1,235\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n3,009\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,343\n\n \n\n \n\n \n\n6,572\n\n \n\n \n\n \n\n4,332\n\n \n\n \n\n \n\n804\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n13,051\n\n \n\nDoubtful\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,079\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,079\n\n \n\nTotal\n\n \n\n$\n\n2,519\n\n \n\n \n\n$\n\n76,897\n\n \n\n \n\n$\n\n82,154\n\n \n\n \n\n$\n\n187,483\n\n \n\n \n\n$\n\n139,023\n\n \n\n \n\n$\n\n107,715\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n595,791\n\n \n\n YTD gross charge-offs\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n(1,143\n\n)\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n(1,143\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommercial real estate:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n20,019\n\n \n\n \n\n$\n\n48,758\n\n \n\n \n\n$\n\n13,741\n\n \n\n \n\n$\n\n21,476\n\n \n\n \n\n$\n\n24,284\n\n \n\n \n\n$\n\n20,415\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n148,693\n\n \n\nWatch\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,363\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,363\n\n \n\nSpecial Mention\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n854\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n3,475\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,329\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n6,288\n\n \n\n \n\n \n\n772\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n7,060\n\n \n\nTotal\n\n \n\n$\n\n20,019\n\n \n\n \n\n$\n\n48,758\n\n \n\n \n\n$\n\n16,958\n\n \n\n \n\n$\n\n21,476\n\n \n\n \n\n$\n\n30,572\n\n \n\n \n\n$\n\n24,662\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n162,445\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nChurch:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n2,330\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n2,091\n\n \n\n \n\n$\n\n3,652\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n8,073\n\n \n\nWatch\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n357\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n594\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n951\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nTotal\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n2,687\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n2,091\n\n \n\n \n\n$\n\n4,246\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n9,024\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nConstruction:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nWatch\n\n \n\n$\n\n6,700\n\n \n\n \n\n$\n\n9,232\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n15,932\n\n \n\nSpecial Mention\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n12,983\n\n \n\n \n\n \n\n5,533\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n18,516\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n12,634\n\n \n\n \n\n \n\n21,073\n\n \n\n \n\n \n\n2,519\n\n \n\n \n\n \n\n1,998\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n38,224\n\n \n\nTotal\n\n \n\n$\n\n6,700\n\n \n\n \n\n$\n\n9,232\n\n \n\n \n\n$\n\n25,617\n\n \n\n \n\n$\n\n26,606\n\n \n\n \n\n$\n\n2,519\n\n \n\n \n\n$\n\n1,998\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n72,672\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommercial – other:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n43,037\n\n \n\n \n\n$\n\n21,347\n\n \n\n \n\n$\n\n18,837\n\n \n\n \n\n$\n\n8,834\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n7,341\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n99,396\n\n \n\nWatch\n\n \n\n \n\n9,984\n\n \n\n \n\n \n\n17,469\n\n \n\n \n\n \n\n14,993\n\n \n\n \n\n \n\n1,000\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,171\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n44,617\n\n \n\nSpecial Mention\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,617\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,617\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n103\n\n \n\n \n\n \n\n261\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n364\n\n \n\nTotal\n\n \n\n$\n\n53,021\n\n \n\n \n\n$\n\n38,816\n\n \n\n \n\n$\n\n33,830\n\n \n\n \n\n$\n\n9,834\n\n \n\n \n\n$\n\n103\n\n \n\n \n\n$\n\n11,390\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n146,994\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSBA:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n3,789\n\n \n\n \n\n$\n\n12,415\n\n \n\n \n\n$\n\n1,452\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n19\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n17,675\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n571\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n148\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n719\n\n \n\nDoubtful\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n74\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n74\n\n \n\nTotal\n\n \n\n$\n\n3,789\n\n \n\n \n\n$\n\n12,986\n\n \n\n \n\n$\n\n1,452\n\n \n\n \n\n$\n\n148\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n93\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n18,468\n\n \n\nYTD gross charge-offs\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n(36\n\n)\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n(36\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nConsumer:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n38\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n38\n\n \n\nTotal\n\n \n\n$\n\n38\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n38\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal loans:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n69,402\n\n \n\n \n\n$\n\n146,248\n\n \n\n \n\n$\n\n101,361\n\n \n\n \n\n$\n\n197,628\n\n \n\n \n\n$\n\n151,777\n\n \n\n \n\n$\n\n126,747\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n793,163\n\n \n\nWatch\n\n \n\n \n\n16,684\n\n \n\n \n\n \n\n39,870\n\n \n\n \n\n \n\n34,056\n\n \n\n \n\n \n\n15,299\n\n \n\n \n\n \n\n9,979\n\n \n\n \n\n \n\n25,794\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n141,682\n\n \n\nSpecial Mention\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n13,837\n\n \n\n \n\n \n\n5,533\n\n \n\n \n\n \n\n1,774\n\n \n\n \n\n \n\n7,327\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n28,471\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n571\n\n \n\n \n\n \n\n13,977\n\n \n\n \n\n \n\n28,965\n\n \n\n \n\n \n\n13,242\n\n \n\n \n\n \n\n3,835\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n60,590\n\n \n\nDoubtful\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,079\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n74\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,153\n\n \n\nTotal loans\n\n \n\n$\n\n86,086\n\n \n\n \n\n$\n\n186,689\n\n \n\n \n\n$\n\n163,231\n\n \n\n \n\n$\n\n249,504\n\n \n\n \n\n$\n\n176,772\n\n \n\n \n\n$\n\n163,777\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n1,026,059\n\n \n\nF-18\n\n[Table of Contents](#TABLEOFCONTENTS)\n\n \n\n \n\nTerm Loans Amortized Cost Basis by Origination Year - As of December 31, 2024\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n2024\n\n \n\n \n\n2023\n\n \n\n \n\n2022\n\n \n\n \n\n2021\n\n \n\n \n\n2020\n\n \n\n \n\nPrior\n\n \n\n \n\nRevolving\n\nLoans\n\n \n\n \n\nTotal\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nSingle-family:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n543\n\n \n\n \n\n$\n\n4,098\n\n \n\n \n\n$\n\n1,968\n\n \n\n \n\n$\n\n1,796\n\n \n\n \n\n$\n\n13,687\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n22,092\n\n \n\nWatch\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n729\n\n \n\n \n\n \n\n1,227\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,956\n\n \n\nSpecial Mention\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nTotal\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n543\n\n \n\n \n\n$\n\n4,098\n\n \n\n \n\n$\n\n2,697\n\n \n\n \n\n$\n\n3,023\n\n \n\n \n\n$\n\n13,687\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n24,048\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nMulti-family:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n81,474\n\n \n\n \n\n$\n\n77,739\n\n \n\n \n\n$\n\n171,836\n\n \n\n \n\n$\n\n126,492\n\n \n\n \n\n$\n\n26,771\n\n \n\n \n\n$\n\n90,584\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n574,896\n\n \n\nWatch\n\n \n\n \n\n–\n\n \n\n \n\n \n\n5,633\n\n \n\n \n\n \n\n16,244\n\n \n\n \n\n \n\n14,761\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n13,244\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n49,882\n\n \n\nSpecial Mention\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,210\n\n \n\n \n\n \n\n3,150\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n7,360\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,562\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,691\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n3,718\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n9,971\n\n \n\nTotal\n\n \n\n$\n\n81,474\n\n \n\n \n\n$\n\n84,934\n\n \n\n \n\n$\n\n192,290\n\n \n\n \n\n$\n\n149,094\n\n \n\n \n\n$\n\n26,771\n\n \n\n \n\n$\n\n107,546\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n642,109\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommercial real estate:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n49,143\n\n \n\n \n\n$\n\n9,655\n\n \n\n \n\n$\n\n23,482\n\n \n\n \n\n$\n\n29,021\n\n \n\n \n\n$\n\n21,150\n\n \n\n \n\n$\n\n22,606\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n155,057\n\n \n\nWatch\n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,584\n\n \n\n \n\n \n\n432\n\n \n\n \n\n \n\n994\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,634\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,644\n\n \n\nSpecial Mention\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n3,271\n\n \n\n \n\n \n\n–\n\n \n\n \n\n297\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n–\n\n \n\n \n\n3,568\n\n \n\nTotal\n\n \n\n$\n\n49,143\n\n \n\n \n\n$\n\n14,510\n\n \n\n \n\n$\n\n23,914\n\n \n\n \n\n$\n\n30,312\n\n \n\n \n\n$\n\n21,150\n\n \n\n \n\n$\n\n24,240\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n163,269\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nChurch:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n2,442\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n2,148\n\n \n\n \n\n$\n\n1,696\n\n \n\n \n\n$\n\n1,002\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n7,288\n\n \n\nWatch\n\n \n\n \n\n–\n\n \n\n \n\n \n\n376\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n618\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n994\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,193\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,193\n\n \n\nTotal\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n2,818\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n2,148\n\n \n\n \n\n$\n\n1,696\n\n \n\n \n\n$\n\n2,813\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n9,475\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nConstruction:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\nWatch\n\n \n\n \n\n9,568\n\n \n\n \n\n \n\n31,274\n\n \n\n \n\n \n\n227\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,038\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n43,107\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,076\n\n \n\n \n\n \n\n38,494\n\n \n\n \n\n \n\n5,463\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n48,033\n\n \n\nTotal\n\n \n\n$\n\n9,568\n\n \n\n \n\n$\n\n35,350\n\n \n\n \n\n$\n\n38,721\n\n \n\n \n\n$\n\n5,463\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n2,038\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n91,140\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommercial – other:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n1\n\n \n\n \n\n$\n\n3\n\n \n\n \n\n$\n\n7,575\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n2,768\n\n \n\n \n\n$\n\n9,965\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n20,312\n\n \n\nWatch\n\n \n\n \n\n19,260\n\n \n\n \n\n \n\n28,157\n\n \n\n \n\n \n\n706\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,197\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n49,320\n\n \n\nSpecial Mention\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n351\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,250\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,601\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n106\n\n \n\n \n\n \n\n571\n\n \n\n \n\n \n\n4,562\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n5,239\n\n \n\nTotal\n\n \n\n$\n\n19,261\n\n \n\n \n\n$\n\n28,160\n\n \n\n \n\n$\n\n8,632\n\n \n\n \n\n$\n\n106\n\n \n\n \n\n$\n\n3,339\n\n \n\n \n\n$\n\n17,974\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n77,472\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSBA:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n590\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n64\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n654\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n150\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n338\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n488\n\n \n\nTotal\n\n \n\n$\n\n590\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n150\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n338\n\n \n\n \n\n$\n\n64\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n1,142\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nConsumer:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n13\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n13\n\n \n\nTotal\n\n \n\n$\n\n13\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n13\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal loans:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPass\n\n \n\n$\n\n131,221\n\n \n\n \n\n$\n\n90,382\n\n \n\n \n\n$\n\n206,991\n\n \n\n \n\n$\n\n159,629\n\n \n\n \n\n$\n\n54,181\n\n \n\n \n\n$\n\n137,908\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n780,312\n\n \n\nWatch\n\n \n\n \n\n28,828\n\n \n\n \n\n \n\n67,024\n\n \n\n \n\n \n\n17,609\n\n \n\n \n\n \n\n16,484\n\n \n\n \n\n \n\n1,227\n\n \n\n \n\n \n\n18,731\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n149,903\n\n \n\nSpecial Mention\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,561\n\n \n\n \n\n \n\n3,150\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n2,250\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n9,961\n\n \n\nSubstandard\n\n \n\n \n\n–\n\n \n\n \n\n \n\n8,909\n\n \n\n \n\n \n\n38,644\n\n \n\n \n\n \n\n10,557\n\n \n\n \n\n \n\n909\n\n \n\n \n\n \n\n9,473\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n68,492\n\n \n\nTotal\n\n \n\n$\n\n160,049\n\n \n\n \n\n$\n\n166,315\n\n \n\n \n\n$\n\n267,805\n\n \n\n \n\n$\n\n189,820\n\n \n\n \n\n$\n\n56,317\n\n \n\n \n\n$\n\n168,362\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n1,008,668\n\n \n\n \n\nAllowance for Credit Losses for Off-Balance Sheet Commitments\n\nThe Company maintains an allowance for credit losses on off-balance sheet commitments related to\nunfunded loans and lines of credit, which is included in accrued expenses and other liabilities of the consolidated statements of financial condition. The Company applies an expected credit loss estimation methodology for off-balance sheet\ncommitments. This methodology is commensurate with the methodology applied to each respective segment of the loan portfolio in determining the ACL for loans held-for-investment. The loss estimation process includes assumptions for the\nprobability that a loan will fund, as well as the expected amount of funding. These assumptions are based on the Company’s own historical internal loan data.\n\nThe allowance for off-balance sheet commitments was $224 thousand and $277 thousand at December 31, 2025 and 2024,\nrespectively. The recovery of credit losses for off-balance sheet commitments was $53 thousand and $91 thousand for the years ended December 31, 2025 and 2024, respectively.\n\nF-19\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nNote 5 – Office Properties and Equipment, net\n\n \n\nYear‑end office properties and equipment were as follows:\n\n \n\n \n\nDecember 31,\n\n2025\n\n \n\n \n\nDecember 31,\n\n2024\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nLand\n\n \n\n$\n\n5,322\n\n \n\n \n\n$\n\n5,322\n\n \n\nOffice buildings and improvements\n\n \n\n \n\n7,649\n\n \n\n \n\n \n\n7,649\n\n \n\nFurniture, fixtures, and equipment\n\n \n\n \n\n1,358\n\n \n\n \n\n \n\n1,214\n\n \n\n \n\n \n\n \n\n14,329\n\n \n\n \n\n \n\n14,185\n\n \n\nLess accumulated depreciation\n\n \n\n \n\n(5,597\n\n)\n\n \n\n \n\n(5,286\n\n)\n\nOffice properties and equipment, net\n\n \n\n$\n\n8,732\n\n \n\n \n\n$\n\n8,899\n\n \n\n \n\nDepreciation expense was $410 thousand and $424 thousand for the years ended December 31, 2025 and 2024, respectively.\n\nNote 6 – Leases\n\nEffective October 1, 2021, the Bank entered into an operating lease for its administrative offices at 4601 Wilshire Boulevard in Los Angeles. The operating lease has one 5-year extension option at the\nthen fair market rate which was exercised during the year ended December 31, 2025.\n\nThe ROU asset represents our right to use the underlying asset during the lease\nterm. Operating lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and lease\nliabilities are recognized based on the present value of the remaining lease payments using a discount rate that represents our incremental borrowing rate at the date of the lease’s inception. The ROU asset totaled $1.5 million and $420 thousand as of\nDecember 31, 2025 and 2024, respectively,  and was included in other assets on the consolidated statements of financial condition.\nThe lease liability totaled $1.5 million and $420 thousand as of December 31, 2025 and 2024, respectively, and was included in accrued expenses and other liabilities on the consolidated statements of financial condition.\n\nThe Bank has no finance leases.\n\nThe Company recognized rent expense of $242\nthousand in both 2025 and 2024.\n\nAdditional information regarding our operating leases is summarized below for\nthe periods indicated (dollars in thousands):\n\n \n\nYear Ended\n\nDecember 31, 2025\n\n \n\n \n\nYear Ended\n\nDecember 31, 2024\n\n \n\nCash paid for amounts included in the measurement of\nlease liabilities for operating leases\n\n \n\n$\n\n242\n\n \n\n \n\n$\n\n242\n\n \n\nROU assets obtained in exchange for lease liabilities\n\n \n\n1,310\n\n \n\n \n\n–\n\n \n\nWeighted average remaining lease term in months\n\n \n\n \n\n73\n\n \n\n \n\n \n\n21\n\n \n\nWeighted average discount rate\n\n \n\n \n\n3.8\n\n%\n\n \n\n \n\n5.5\n\n%\n\nThe future minimum payments for operating leases with remaining terms of one\nyear or more as of December 31, 2025 were as follows (in thousands):\n\nYear ended December 31, 2026\n\n \n\n$\n\n249\n\n \n\nYear ended December 31, 2027\n\n \n\n \n\n271\n\n \n\nYear ended December 31, 2028\n\n \n\n \n\n271\n\n \n\nYear ended December 31, 2029\n\n \n\n \n\n271\n\n \n\nYear ended December 31, 2030\n\n \n\n \n\n271\n\n \n\nThereafter\n\n \n\n \n\n293\n\n \n\nTotal future minimum lease payments\n\n \n\n \n\n1,626\n\n \n\nAmounts representing interest\n\n \n\n \n\n(135\n\n)\n\nPresent value of net future minimum lease payments\n\n \n\n$\n\n1,491\n\n \n\nF-20\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nNote 7 – Goodwill and Core Deposit Intangible\n\nThe following tables present the changes in the carrying amounts of goodwill and core deposit intangibles for the years ended December\n31, 2025 and 2024:\n\n \n\n \n\nDecember 31, 2025\n\n \n\n \n\n \n\nGoodwill\n\n \n\n \n\nCore Deposit\n\nIntangible\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nBalance at the beginning of the period\n\n \n\n$\n\n25,858\n\n \n\n \n\n$\n\n1,775\n\n \n\nImpairment\n\n \n\n \n\n(25,858\n\n)\n\n \n\n \n\n–\n\n \n\nAmortization\n\n \n\n \n\n–\n\n \n\n \n\n \n\n(315\n\n)\n\nBalance at the end of the period\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n1,460\n\n \n\n \n\nDecember 31, 2024\n\n \n\n \n\nGoodwill\n\n \n\n \n\nCore Deposit\n\nIntangible\n\n \n\n \n\n(In thousands)\n\n \n\nBalance at the beginning of the period\n\n \n\n$\n\n25,858\n\n \n\n \n\n$\n\n2,111\n\n \n\nAmortization\n\n \n\n \n\n-\n\n \n\n \n\n \n\n(336\n\n)\n\nBalance at the end of the period\n\n \n\n$\n\n25,858\n\n \n\n \n\n$\n\n1,775\n\n \n\nManagement engaged a third-party to complete the goodwill impairment testing as\nof September 30, 2025. The quantitative test indicated that the carrying amount of the goodwill exceeded the fair value of the Company by approximately $25.9 million. On October 15, 2025, the Company’s management, with oversight of the Audit Committee of the Board of Directors of the Company, concluded that, based on its annual impairment\nanalysis, the Company’s goodwill was impaired in accordance with U.S. GAAP. Consequently, the Company recorded a non-cash $25.9 million\ngoodwill impairment charge for the quarter ended September 30, 2025. The Company does not expect that this charge will result in future cash expenditures.\n\nThe carrying value and accumulated amortization related to the Company’s core deposit intangible consisted of the following at December 31, 2025 and 2024:\n\n \n\n \n\nDecember 31,\n\n2025\n\n \n\n \n\nDecember 31,\n\n2024\n\n \n\n \n\n \n\n(In thousands)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCore deposit intangible acquired\n\n \n\n$\n\n3,329\n\n \n\n \n\n$\n\n3,329\n\n \n\nLess: accumulated amortization\n\n \n\n \n\n(1,869\n\n)\n\n \n\n \n\n(1,554\n\n)\n\n \n\n \n\n$\n\n1,460\n\n \n\n \n\n$\n\n1,775\n\n \n\nThe following table outlines the estimated amortization expense\nrelated to the core deposit intangible during the next five fiscal years:\n\n \n\n \n\n(In thousands)\n\n \n\n \n\n \n\n \n\n \n\n2026\n\n \n\n$\n\n304\n\n \n\n2027\n\n \n\n \n\n291\n\n \n\n2028\n\n \n\n \n\n279\n\n \n\n2029\n\n \n\n \n\n267\n\n \n\n2030\n\n \n\n \n\n256\n\n \n\nThereafter\n\n \n\n \n\n63\n\n \n\n \n\n \n\n$\n\n1,460\n\n \n\nF-21\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nNote 8 – Derivatives\n\nDuring the year ended\nDecember 31, 2025, the Company began utilizing interest rate swap agreements with commercial banking customers to facilitate their interest rate management strategies.  The Company entered into corresponding offsetting derivatives with third\nparties.  While these derivatives represent economic hedges, they do not qualify as hedges for accounting purposes.\n\nThe Company presents derivative position gross on the consolidated statements of financial condition.  The notional amount of the interest rate swaps does not\nrepresent amounts exchanged by the parties.  The amount exchanged is determined by reference to the notional amount and the other terms of the individual interest rate swap agreements.  The following table presents the amounts recorded on the consolidated\nstatements of financial condition related to the Company’s interest rate swaps.\n\n \n\nAs of December 31, 2025\n\n \n\nNotional Amount\n\n \n\nFair Value\n\n \n\nConsolidated\n\nStatements of\n\nFinancial\n\nCondition\n\nCategory\n\n \n\n(In thousands)\n\nDerivatives in an asset position:\n\n \n\n \n\n \n\n \n\n           \n\nDerivatives not designated as hedging instruments:\n\n \n\n \n\n \n\n \n\n           \n\nInterest rate swaps related to customer loans\n\n \n\n$\n\n17,000\n\n \n\n \n\n$\n\n105\n\n \n\nOther Assets\n\nTotal derivatives in an asset position\n\n \n\n$\n\n17,000\n\n \n\n \n\n$\n\n105\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n                         \n\nDerivatives in a liability position:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n                     \n\nDerivatives not designated as hedging instruments:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n                     \n\nInterest rate swaps related to customer loans\n\n \n\n$\n\n17,000\n\n \n\n \n\n$\n\n105\n\n \n\n \n\nTotal derivatives in a liability position\n\n \n\n$\n\n17,000\n\n \n\n \n\n$\n\n105\n\n \n\nAccrued Expenses and Other Liabilities\n\nThe following table presents the effect of the Company’s derivative financial instruments on the Consolidated Statements of Operations.\n\n \n\nFor the Year Ended December 31, 2025\n\n \n\n \n\nLocation of Gain/Loss\n\nRecognized on Derivatives on\n\nConsolidated Statement of\n\nOperations\n\n \n\nAmount of Gain/Loss\n\nRecognized on Derivatives\n\n \n\n(In thousands)\n\n \n\n \n\n \n\n \n\nDerivatives not designated as hedging instruments:\n\n \n\n \n\n \n\n \n\nInterest rate swaps related to customer loans\n\nUnrealized gain/loss\n\n \n\n$\n\n-\n\n \n\nDuring the year ended December 31, 2025, the Company also recognized $194\nthousand in swap fees in Other Income on the Consolidated Statement of Operations.\n\nF-22\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nNote 9 – Fair Value\n\n \n\nFair\nvalue is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an ordinary transaction between market participants on the\nmeasurement date.  There are three levels of inputs that may be used to measure fair values:\n\nLevel 1:\n\nQuoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.\n\nLevel 2:\n\nSignificant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by\nobservable market data.\n\nLevel 3:\n\nSignificant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.\n\n \n\nThe Company used the following\nmethods and significant assumptions to estimate fair value:\n\nThe\nfair values of securities available-for-sale are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs) or matrix pricing, which is a mathematical technique to value debt securities without relying\nexclusively on quoted prices for the specific securities, but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs).\n\nAssets and Liabilities Measured on a Recurring Basis\n\n \n\nAssets and liabilities measured at fair value on a recurring basis are summarized below:\n\n \n\n \n\n \n\nFair Value Measurement\n\n \n\n \n\n \n\nQuoted Prices\n\nin Active\n\nMarkets for\n\nIdentical Assets\n\n(Level 1)\n\n \n\n \n\nSignificant\n\nOther\n\nObservable\n\nInputs\n\n(Level 2)\n\n \n\n \n\nSignificant\n\nUnobservable\n\nInputs\n\n(Level 3)\n\n \n\n \n\nTotal\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nAt December 31, 2025:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSecurities available-for-sale:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFederal agency mortgage-backed securities\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n114,430\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n114,430\n\n \n\nFederal agency CMOs\n\n \n\n \n\n–\n\n \n\n \n\n \n\n69,457\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n69,457\n\n \n\nFederal agency debt\n\n \n\n \n\n–\n\n \n\n \n\n \n\n28,413\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n28,413\n\n \n\nMunicipal bonds\n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,522\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,522\n\n \n\nU.S. Treasuries\n\n \n\n \n\n4,987\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,987\n\n \n\nSBA pools\n\n \n\n \n\n–\n\n \n\n \n\n \n\n8,275\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n8,275\n\n \n\nAsset-backed securities\n\n \n\n \n\n–\n\n \n\n \n\n \n\n9,269\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n9,269\n\n \n\nCorporate bonds\n\n \n\n \n\n–\n\n \n\n \n\n \n\n17,482\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n17,482\n\n \n\nInterest rate swap asset\n\n \n\n \n\n–\n\n \n\n \n\n \n\n105\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n105\n\n \n\nInterest rate swap liability\n\n \n\n \n\n–\n\n \n\n \n\n \n\n(105\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n(105\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAt December 31, 2024:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSecurities available-for-sale:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFederal agency mortgage-backed securities\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n53,029\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n53,029\n\n \n\nFederal agency CMOs\n\n \n\n \n\n–\n\n \n\n \n\n \n\n20,058\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n20,058\n\n \n\nFederal agency debt\n\n \n\n \n\n–\n\n \n\n \n\n \n\n40,034\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n40,034\n\n \n\nMunicipal bonds\n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,388\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,388\n\n \n\nU.S. Treasuries\n\n \n\n \n\n77,190\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n77,190\n\n \n\nSBA pools\n\n \n\n \n\n–\n\n \n\n \n\n \n\n9,163\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n9,163\n\n \n\n \n\nThere were no transfers between Level 1, Level 2, or Level 3 during the years ended December 31, 2025 or 2024.\n\nAssets Measured on a Nonrecurring Basis\n\nThe\nCompany measures certain assets at fair value on a nonrecurring basis and the following is a general description of the methods used to value such assets.\n\nCollateral-Dependent\n\nLoans - The fair value of collateral-dependent loans with specific allocations of the allowance for loan losses is generally based on recent appraisals. These appraisals may utilize a single valuation approach or a combination of approaches\nincluding comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available for similar loans and\ncollateral underlying loans and result in a Level 3 classification.\n\nF-23\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nThe table below presents assets measured at fair value on a nonrecurring\nbasis at December 31, 2025.  At December 31, 2024, the Company did not have any assets or liabilities carried at fair value on\na nonrecurring basis.\n\n \n\n \n\nFair Value Measurement\n\n \n\n \n\n \n\nQuoted Prices in Active Markets for Identical Assets (Level 1)\n\n \n\n \n\nSignificant Other Observable Inputs (Level 2)\n\n \n\n \n\nSignificant Unobservable Inputs (Level 3)\n\n \n\n \n\nTotal\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nAt December 31, 2025:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCollateral dependent loans:\n\nReal estate:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSingle-family\n\n \n\n$\n\n-\n\n \n\n \n\n$\n\n-\n\n \n\n \n\n$\n\n424\n\n \n\n \n\n$\n\n424\n\n \n\nMulti-family\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n2,094\n\n \n\n \n\n \n\n2,094\n\n \n\nConstruction\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n7,435\n\n \n\n \n\n \n\n7,435\n\n \n\nCommercial - other\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n138\n\n \n\n \n\n \n\n138\n\n \n\nThe following\ntable represents quantitative information about Level 3 fair value assumptions for assets measured at fair value on a non-recurring basis at December 31, 2025.\n\n \n\n \n\nFair Value\n\n \n\nValuation\n\nTechnique(s)\n\n \n\nUnobservable Input(s)\n\n \n\nRange\n\n \n\n \n\n \n\n(In thousands)\n\nAt December 31, 2025:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCollateral dependent loans:\n\nReal estate:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSingle-family\n\n \n\n$\n\n424\n\n \n\nMarket approach\n\n \n\nAdjustments to market data\n\n \n\n \n\n5% - 10\n\n%\n\nMulti-family\n\n \n\n \n\n2,094\n\n \n\nMarket approach\n\n \n\nAdjustments to market data\n\n \n\n \n\n5% - 10\n\n%\n\nConstruction\n\n \n\n \n\n7,435\n\n \n\nMarket approach\n\n \n\nAdjustments to market data\n\n \n\n \n\n5% - 10\n\n%\n\nCommercial - other\n\n \n\n \n\n138\n\n \n\nMarket approach\n\n \n\nAdjustments to market data\n\n \n\n \n\n5% - 10\n\n%\n\nFair Values of Financial Instruments\n\n \n\nThe carrying amounts and estimated fair values of financial instruments as of the periods indicated were as follows:\n\n \n\n \n\n \n\nCarrying\n\n \n\n \n\nFair Value Measurements at December 31, 2025\n\n \n\n \n\n \n\nValue\n\n \n\n \n\nLevel 1\n\n \n\n \n\nLevel 2\n\n \n\n \n\nLevel 3\n\n \n\n \n\nTotal\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nFinancial Assets:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCash and cash equivalents\n\n \n\n$\n\n10,507\n\n \n\n \n\n$\n\n10,507\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n10,507\n\n \n\nSecurities available-for-sale\n\n \n\n \n\n256,835\n\n \n\n \n\n \n\n4,987\n\n \n\n \n\n \n\n251,848\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n256,835\n\n \n\nLoans receivable held for investment\n\n \n\n \n\n1,016,540\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,002,049\n\n \n\n \n\n \n\n1,002,049\n\n \n\nAccrued interest receivable\n\n \n\n \n\n5,999\n\n \n\n \n\n \n\n36\n\n \n\n \n\n \n\n800\n\n \n\n \n\n \n\n5,163\n\n \n\n \n\n \n\n5,999\n\n \n\nInterest rate swaps\n\n \n\n \n\n105\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n105\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n105\n\n \n\nFinancial Liabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNon interest bearing deposits\n\n \n\n$\n\n105,835\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n105,835\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n105,835\n\n \n\nInterest bearing deposits\n\n \n\n \n\n512,034\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n512,034\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n512,034\n\n \n\nTime deposits\n\n \n\n \n\n299,734\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n299,434\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n299,434\n\n \n\nFHLB advances\n\n \n\n \n\n72,000\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n72,019\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n72,019\n\n \n\nSecurities sold under agreements to repurchase\n\n \n\n \n\n80,773\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n80,773\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n80,773\n\n \n\nAccrued interest payable\n\n \n\n \n\n1,633\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,633\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,633\n\n \n\nInterest rate swaps\n\n \n\n \n\n105\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n105\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n105\n\n \n\n \n\n \n\nCarrying\n\n \n\n \n\nFair Value Measurements at December 31, 2024\n\n \n\n \n\n \n\nValue\n\n \n\n \n\nLevel 1\n\n \n\n \n\nLevel 2\n\n \n\n \n\nLevel 3\n\n \n\n \n\nTotal\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nFinancial Assets:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCash and cash equivalents\n\n \n\n$\n\n61,365\n\n \n\n \n\n$\n\n61,365\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n61,365\n\n \n\nSecurities available-for-sale\n\n \n\n \n\n203,862\n\n \n\n \n\n \n\n77,190\n\n \n\n \n\n \n\n126,672\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n203,862\n\n \n\nLoans receivable held for investment\n\n \n\n \n\n999,956\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n973,183\n\n \n\n \n\n \n\n973,183\n\n \n\nAccrued interest receivable\n\n \n\n \n\n5,001\n\n \n\n \n\n \n\n5,001\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n5,001\n\n \n\nBank owned life insurance\n\n \n\n \n\n3,321\n\n \n\n \n\n \n\n3,321\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n3,321\n\n \n\nFinancial Liabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDeposits\n\n \n\n$\n\n745,399\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n669,695\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n669,695\n\n \n\nFHLB advances\n\n \n\n \n\n226,888\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n227,150\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n227,150\n\n \n\nSecurities sold under agreements to repurchase\n\n \n\n \n\n66,610\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n66,070\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n66,070\n\n \n\nAccrued interest payable\n\n \n\n \n\n1,349\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,349\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,349\n\n \n\nThe\nfair value of financial assets and liabilities was measured using an exit price notion. Although the exit price notion represents the value that would be received to sell an asset or paid to transfer a liability, the actual price received for a\nsale of assets or paid to transfer liabilities could be different from exit price disclosed.\n\nF-24\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nNote 10 – Deposits\n\n \n\nDeposits are summarized as follows:\n\n \n\n \n\n \n\nDecember 31,\n\n2025\n\n  \n\n  \n\nDecember 31,\n\n2024\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nInterest checking and other demand deposits\n\n \n\n$\n\n259,318\n\n \n\n \n\n$\n\n251,538\n\n \n\nNon‑interest-bearing demand deposits\n\n \n\n \n\n105,835\n\n \n\n \n\n \n\n105,227\n\n \n\nMoney market deposits\n\n \n\n \n\n211,962\n\n \n\n \n\n \n\n125,862\n\n \n\nSavings deposits\n\n \n\n \n\n40,754\n\n \n\n \n\n \n\n49,933\n\n \n\nCertificates of deposit\n\n \n\n \n\n299,734\n\n \n\n \n\n \n\n212,839\n\n \n\nTotal\n\n \n\n$\n\n917,603\n\n \n\n \n\n$\n\n745,399\n\n \n\n \n\nThe Bank accepts two types of deposits from a deposit placement service called the Certificate of Deposit Account Registry Service (“CDARS”). Reciprocal deposits are\nthe Bank’s own retail deposits in amounts in excess of the insured limits. The CDARS program allows banks to place their customers’ funds in FDIC‑insured certificates of deposit at other banks and, at the same time, receive an equal sum of funds\nfrom the customers of other banks in the CDARS Network. These deposits totaled $150.8 million and $145.8 million at December 31, 2025 and 2024, respectively and are not considered to be brokered deposits. The other type of deposit that may be\naccepted under the CDARS program is nonreciprocal deposits which are considered to be brokered funds. As of December 31, 2025 and 2024, the Bank had no\nsuch deposits.\n\nDuring the year ended December 31, 2025, the Company purchased $70.0 million of nonreciprocal brokered certificates of deposit.  The balance of these certificates of deposit was $70.0 million at December 31, 2025.\n\nAs of December 31, 2025 and 2024, approximately $413.5\nmillion and $268.8 million of our total deposits (including deposits from affiliates) were not insured by FDIC insurance, which\nrepresented 41% and 32%\nof total deposits, respectively.\n\n \n\nScheduled maturities of certificates of deposit for the next five years are as follows:\n\n \n\nMaturity\n\n \n\nAmount\n\n \n\n \n\n \n\n(In thousands)\n\n \n\n2026\n\n \n\n$\n\n294,642\n\n \n\n2027\n\n \n\n \n\n3,692\n\n \n\n2028\n\n \n\n \n\n1,302\n\n \n\n2029\n\n \n\n \n\n66\n\n \n\n2030\n\n \n\n \n\n32\n\n \n\nThereafter\n\n \n\n \n\n-\n\n \n\n \n\n \n\n$\n\n299,734\n\n \n\n \n\nCertificates of deposit of $250 thousand or more totaled $105.1\nmillion and $33.2 million at December 31, 2025 and 2024, respectively.\n\nThe Company has a significant concentration of deposits with five long‑time customers that accounted for approximately 28% and 18% of its deposits as of December 31, 2025 and 2024, respectively.\n\nDeposits from principal officers, directors, and their affiliates totaled $24.8 million and $24.2 million at December 31, 2025 and 2024, respectively.\n\nNote 11 – Borrowings\n\nThe following table summarizes information relating to FHLB advances at or for the periods indicated:\n\n \n\nAt or For the Year Ended\n\nDecember 31,\n\n \n\n \n\n2025\n\n \n\n2024\n\n \n\n \n\n(Dollars in thousands)\n\n \n\nFHLB Advances:\n\n \n\n \n\n \n\n \n\nAverage balance outstanding during the year\n\n \n\n$\n\n93,431\n\n \n\n \n\n$\n\n199,893\n\n \n\nMaximum amount outstanding at any month‑end during the year\n\n \n\n$\n\n150,750\n\n \n\n \n\n$\n\n209,298\n\n \n\nBalance outstanding at end of year\n\n \n\n$\n\n72,000\n\n \n\n \n\n$\n\n195,532\n\n \n\nWeighted average interest rate at end of year\n\n \n\n \n\n3.79\n\n%\n\n \n\n \n\n4.03\n\n%\n\nAverage cost of advances during the year\n\n \n\n \n\n4.28\n\n%\n\n \n\n \n\n4.79\n\n%\n\nWeighted average maturity (in months)\n\n \n\n \n\n–\n\n(1)\n\n \n\n \n\n–\n\n \n\n \n\n(1)\n\nThe majority of FHLB advances are overnight borrowings\n\nOf the $72.0 million FHLB advances\noutstanding at December 31, 2025, $60.0 million is fixed-rate credit and subject to prepayment penalties if paid before its maturity\ndate. The advances were collateralized by $448.6 million and $521.7 million of commercial real estate loans at December 31, 2025 and 2024, respectively, under a blanket lien arrangement. Based on collateral pledged and the Company’s holdings of\nFHLB stock as of December 31, 2025, the Company was eligible to borrow up to an additional $150.7 million at year‑end 2025.\n\nScheduled maturities of FHLB advances are as follows:\n\n \n\nAmount\n\n \n\n \n\n(In thousands)\n\n \n\n2026\n\n \n\n$\n\n72,000\n\n \n\n2027\n\n \n\n \n\n–\n\n \n\n \n\n \n\n$\n\n72,000\n\n \n\nThe Company will, from time to time, sell a portion of a loan or group of loans to third parties. In some cases, the transferred portion of the loans\ndoes not meet the requirements to be treated as sales for accounting purposes. When that occurs, the legally transferred portion of the loan balance remains classified in gross loans receivable held for investment and a secured borrowing is\nrecorded for the proceeds received from the third-party institution. As the transferred portion of the loan pays down, the secured borrowings are repaid. The Company has no obligation to make principal or interest payments on the secured\nborrowings unless and until payments are received from the loan borrowers.  The terms of these loans were modified during the fourth quarter of 2025, at which point sale accounting treatment was applied and the debt was derecognized. The\nCompany had secured borrowings associated with these participation loan transactions of $0 and $31.4 million as of December 31, 2025 and 2024, respectively.  The weighted average interest rate on the secured borrowings was 5.54% at December 31, 2024.\n\nOn December 27,\n2023, the Company borrowed $100.0 million from the Federal Reserve under the Bank Term Funding Program (“BTFP”). This borrowing was\npaid off in December 2024. The interest rate on this borrowing was fixed at 4.84%.\n\nIn addition, the\nBank had additional lines of credit of $10.0 million with other financial institutions as of December 31, 2025 and 2024. No amounts were drawn on the lines of credit at December 31, 2025 or 2024.\n\nF-25\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nNote 12 – Securities Sold Under Agreements to Repurchase\n\nThe Bank enters into agreements under which it sells securities subject to an obligation to repurchase the same or similar securities. Under these\narrangements, the Bank may transfer legal control over the assets but still retain effective control through an agreement that both entitles and obligates the Bank to repurchase the assets. As a result, these repurchase agreements are accounted\nfor as collateralized financing agreements (i.e., secured borrowings) and not as a sale and subsequent repurchase of securities. The obligation to repurchase the securities is reflected as a liability in the Bank’s consolidated statements of\nfinancial condition, while the securities underlying the repurchase agreements remain in the respective investment securities asset accounts. In other words, there is no offsetting or netting of the investment securities assets with the\nrepurchase agreement liabilities. As of December 31, 2025, securities sold under agreements to repurchase totaled $80.8 million at an\naverage rate of 3.66%. These agreements mature on a daily basis, but management expects the agreements to be available in the\nforeseeable future. The fair value of securities pledged totaled $83.7 million as of December 31, 2025. As of December 31, 2024,\nsecurities sold under agreements to repurchase totaled $66.6 million at an average rate of 3.62%. The fair value of securities pledged totaled $83.3\nmillion as of December 31, 2024.\n\nNote 13 – Employee Benefit Plans\n\n \n\n401(k) Plans\n\n \n\nIn July of 2022, the Broadway Federal Bank 401(k) benefit plan and the City First Bank 401(k) benefit plan were combined into one plan called “the City First\nBank 401(k) benefit plan” (the “401(k) Plan”). The 401(k) Plan allows employee contributions for substantially all employees up to 15%\nof their compensation, which are matched at a rate equal to 50% of the first 6% of compensation contributed. In addition, the 401(k) Plan makes a non-elective safe harbor contribution of 3% of each eligible employee’s compensation. Expenses related to the 401(k) plans totaled $417\nthousand in 2025 and $476 thousand in 2024.\n\n \n\nESOP Plan\n\n \n\nEmployees participate in an Employee Stock Ownership Plan (“ESOP”) after attaining certain age and service\nrequirements. During 2022, the ESOP purchased 58,369 shares of the Company’s common stock at an average cost of $8.57 per share for a total cost of $500\nthousand which was funded with a $5 million line of credit from the Company. During 2023, the ESOP purchased 369,953 additional shares of the Company’s common stock at an average cost of $9.19 per share for a total cost of $3.4 million which was funded with the\nline of credit. Any loans or borrowings under the line of credit will be repaid from the Bank’s discretionary contributions to the ESOP, net of dividends paid, over a period of 20 years. Shares of the Company’s common stock purchased by the ESOP are held in a suspense account until released for allocation to participants. When loan payments are made, shares are\nallocated to each eligible participant based on the ratio of each such participant’s compensation, as defined in the ESOP, to the total compensation of all eligible plan participants. As the unearned shares are released from the suspense\naccount, the Company recognizes compensation expense equal to the fair value of the ESOP shares during the periods in which they become committed to be released. To the extent that the fair value of the ESOP shares released differs from the\ncost of such shares, the difference is charged or credited to equity as additional paid‑in capital. Dividends on allocated shares increase participant accounts. Dividends on unallocated shares will be used to repay the loan. At the end of\nemployment, participants will receive shares for their vested balance. Compensation expense related to the ESOP was $149 thousand for\n2025 and $188 thousand for 2024.\n\nShares held by the ESOP were as follows:\n\n \n\n \n\n \n\nDecember 31,\n\n2025\n\n \n\n \n\nDecember 31,\n\n2024\n\n \n\n \n\n \n\n(Dollars in thousands)\n\n \n\nAllocated to participants\n\n \n\n124,968\n\n \n\n \n\n127,804\n\n \n\nCommitted to be released\n\n \n\n \n\n55,568\n\n \n\n \n\n \n\n30,036\n\n \n\nSuspense shares\n\n \n\n \n\n406,108\n\n \n\n \n\n \n\n428,804\n\n \n\nTotal ESOP shares\n\n \n\n586,644\n\n \n\n \n\n586,644\n\n \n\nFair value of unearned shares\n\n \n\n$\n\n3,005\n\n \n\n \n\n$\n\n2,937\n\n \n\n \n\nDuring 2025 and 2024, 0 and 30,036 of ESOP shares were released for allocation to participants, respectively. The outstanding book balance of unearned ESOP shares at December 31,\n2025 and 2024 was $3.9 million and $4.2\nmillion, respectively, which is shown as unearned ESOP shares in the equity section of the consolidated statements of financial condition.\n\nDuring December 2022, the Company issued a $5 million line of credit to the ESOP Plan\nfor the purchase of additional shares. As of December 31, 2025 and December 31, 2024, the trustee for the ESOP had purchased 428,327 shares at a total cost of $3.9 million.\n\n \n\nNote 14 – Income Taxes\n\n \n\nThe Company and its subsidiary are subject to U.S. federal and state income taxes. Income tax expense is the total of the current year income tax due or refundable\nand the change in deferred tax assets and liabilities. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and\nliabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary\ndifferences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.\n\nF-26\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nThe Company adopted the disclosure requirements in ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, on a retrospective basis as of January 1, 2025.  The adoption primarily impacted the presentation and disaggregation of the Company’s\nincome tax disclosures and did not affect the Company’s consolidated financial condition, results of operations, or cash flows.\n\n \n\nThe components of income tax expense (benefit) from continuing operations consisted of the following:\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nCurrent\n\n \n\n \n\n \n\n \n\n \n\n \n\nFederal\n\n \n\n$\n\n118\n\n \n\n \n\n$\n\n505\n\n \n\nState\n\n \n\n \n\n270\n\n \n\n \n\n \n\n504\n\n \n\n    Foreign\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nDeferred\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFederal\n\n \n\n \n\n(245\n\n)\n\n \n\n \n\n12\n\n \n\nState\n\n \n\n \n\n195\n\n \n\n \n\n \n\n(206\n\n)\n\n    Foreign\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nTotal\n\n \n\n$\n\n338\n\n \n\n \n\n$\n\n815\n\n \n\n \n\nIncome taxes paid, net of refunds received was as follows:\n\n \n\n \n\n2025\n\n \n\n \n\n \n\n2024\n\n \n\n \n\n(In thousands)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFederal\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n150\n\n \n\nCalifornia\n\n \n\n \n\n215\n\n \n\n \n\n \n\n200\n\n \n\nWashington, D.C.\n\n \n\n \n\n110\n\n \n\n \n\n \n\n66\n\n \n\n  Total\n\n \n\n$\n\n325\n\n \n\n \n\n$\n\n416\n\n \n\nEffective tax rates differ from the federal statutory rate of 21%\napplied to income before income taxes due to the following:\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n \n\n(In thousands)\n\n \n\n \n\n(In thousands)\n\n \n\nU. S. Federal statutory income tax\n\n \n\n$\n\n(5,139\n\n)\n\n \n\n \n\n21.00\n\n%\n\n \n\n$\n\n581\n\n \n\n \n\n \n\n21.00\n\n%\n\nState and local taxes, net of federal benefit*\n\n \n\n \n\n367\n\n \n\n \n\n \n\n(1.50\n\n)%\n\n \n\n \n\n211\n\n \n\n \n\n \n\n7.62\n\n%\n\nNontaxable or nondeductible items\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nEarnings from bank owned life insurance\n\n \n\n \n\n(72\n\n)\n\n \n\n \n\n0.29\n\n%\n\n \n\n \n\n(10\n\n)\n\n \n\n \n\n(0.36\n\n)%\n\nTax-exempt interest, net of TEFRA disallowance\n\n \n\n \n\n(7\n\n)\n\n \n\n \n\n0.03\n\n%\n\n \n\n \n\n(5\n\n)\n\n \n\n \n\n(0.18\n\n)%\n\nGoodwill impairment\n\n \n\n \n\n5,430\n\n \n\n \n\n \n\n(22.19\n\n)%\n\n \n\n \n\n–\n\n \n\n \n\n \n\n0.00\n\n%\n\nStock-based compensation\n\n \n\n \n\n7\n\n \n\n \n\n \n\n(0.03\n\n)%\n\n \n\n \n\n38\n\n \n\n \n\n \n\n1.37\n\n%\n\nOther, net\n\n \n\n \n\n(248\n\n)\n\n \n\n \n\n1.02\n\n%\n\n \n\n \n\n–\n\n \n\n \n\n \n\n0.00\n\n%\n\nEffective tax rate\n\n \n\n$\n\n338\n\n \n\n \n\n \n\n(1.38\n\n)%\n\n \n\n$\n\n815\n\n \n\n \n\n \n\n29.43\n\n%\n\n*\n\nState and local taxes in California\nand Washington, D.C. made up the majority (greater than 50 percent) of the tax effect in this category.\n\nYear‑end deferred tax assets and liabilities were due to the following:\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nDeferred tax assets:\n\n \n\n \n\n \n\n \n\n \n\n \n\nAllowance for credit losses\n\n \n\n$\n\n2,658\n\n \n\n \n\n$\n\n2,408\n\n \n\nAccrued liabilities\n\n \n\n \n\n851\n\n \n\n \n\n \n\n483\n\n \n\nState income taxes\n\n \n\n \n\n56\n\n \n\n \n\n \n\n108\n\n \n\nStock compensation\n\n \n\n \n\n239\n\n \n\n \n\n \n\n196\n\n \n\nTax loss carryforwards\n\n \n\n \n\n1,900\n\n \n\n \n\n \n\n1,880\n\n \n\nPartnership investment\n\n \n\n \n\n252\n\n \n\n \n\n \n\n292\n\n \n\nGeneral business credit\n\n \n\n \n\n1,007\n\n \n\n \n\n \n\n1,544\n\n \n\nNet unrealized loss on securities available-for-sale\n\n \n\n \n\n2,403\n\n \n\n \n\n \n\n4,864\n\n \n\nLease liability\n\n \n\n \n\n424\n\n \n\n \n\n \n\n127\n\n \n\nFair value adjustment on acquired loans\n\n \n\n \n\n27\n\n \n\n \n\n \n\n100\n\n \n\nOther\n\n \n\n \n\n316\n\n \n\n \n\n \n\n166\n\n \n\nTotal deferred tax assets\n\n \n\n \n\n10,133\n\n \n\n \n\n \n\n12,168\n\n \n\nLess: valuation allowance\n\n \n\n \n\n(449\n\n)\n\n \n\n \n\n(449\n\n)\n\nTotal deferred tax assets, net of valuation allowance\n\n \n\n \n\n9,684\n\n \n\n \n\n \n\n11,719\n\n \n\nDeferred tax liabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDeferred loan fees/costs\n\n \n\n \n\n(1,152\n\n)\n\n \n\n \n\n(1,273\n\n)\n\nBasis difference on fixed assets\n\n \n\n \n\n(726\n\n)\n\n \n\n \n\n(708\n\n)\n\nFHLB stock dividends\n\n \n\n \n\n(1\n\n)\n\n \n\n \n\n(54\n\n)\n\nPrepaid expenses\n\n \n\n \n\n(261\n\n)\n\n \n\n \n\n(172\n\n)\n\nRight of use assets\n\n \n\n \n\n(421\n\n)\n\n \n\n \n\n(121\n\n)\n\nCore deposit intangibles\n\n \n\n \n\n(412\n\n)\n\n \n\n \n\n(511\n\n)\n\nTotal deferred tax liabilities\n\n \n\n \n\n(2,973\n\n)\n\n \n\n \n\n(2,839\n\n)\n\nNet deferred tax assets\n\n \n\n$\n\n6,711\n\n \n\n \n\n$\n\n8,880\n\n \n\nDeferred tax assets\nare reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all, of the deferred tax asset will not be realized. In assessing the realization of deferred tax assets, management\nevaluated both positive and negative evidence, the amount of taxes paid in available carry‑back years, and the forecasts of future income and tax planning strategies. Based on this analysis, management determined that, as of December 31, 2025, a\nvaluation allowance of $449 thousand was required on the Company’s net deferred tax assets, which totaled $6.7 million (net of valuation allowance). As of December 31, 2024, a valuation allowance of $449 thousand was required on the Company’s net deferred tax assets, which totaled $8.9 million (net of valuation allowance).\n\nAs of December 31,\n2025, the Company had California net operating loss carryforwards of $22.0 million which will begin to expire in 2032 if not\nutilized. The Company also had federal general business credits of $1.0 million, which will begin to expire in 2033 if not utilized.\n\n  \n\nThe Company did not have any unrecognized tax benefits as of December 31, 2025 or 2024.\n\n \n\nFederal tax years 2022 through 2025 remain open for the assessment of Federal income tax.\nCalifornia tax years 2021 through 2025 remain open for the assessment of California franchise tax. Washington, D.C. tax years 2022 through 2025 remain open for the assessment of D.C. franchise tax. The Company is not currently under\nexamination by any tax authorities.\n\nF-27\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nNote 15 – Stock‑Based Compensation\n\n \n\nPrior to June 21, 2023, the Company issued stock-based\ncompensation awards to its directors and officers under the 2018 Long Term Incentive Plan (“LTIP”) which allowed the grant of non-qualified and incentive stock options, stock appreciation rights, full value awards and cash incentive awards. \nThe maximum number of shares that could be awarded under that plan was 161,639 shares.\n\nOn June 21, 2023, stockholders approved the Amended\nand Restated 2018 Long Term Incentive Plan (“Amended and Restated LTIP”) which allows the issuance of 487,500 additional\nshares and brought the number of shares that may be issued under the Amended and Restated LTIP to 649,139 shares.\n\nThe following table summarizes stock option activity during the year ended December 31, 2025:\n\n \n\n \n\n \n\n \n\n \n\n \n\nNumber\n\nOutstanding\n\n \n\n \n\nWeighted\n\nAverage\n\nExercise\n\nPrice\n\n \n\nOutstanding at beginning of year\n\n \n\n \n\n12,500\n\n \n\n \n\n$\n\n12.96\n\n \n\nGranted during the year\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nExercised during the year\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nForfeited or expired during the year\n\n \n\n \n\n–\n\n \n\n \n\n12.96\n\n \n\nOutstanding at end of year\n\n \n\n \n\n12,500\n\n \n\n \n\n$\n\n12.96\n\n \n\nExercisable at end of year\n\n \n\n \n\n12,500\n\n \n\n \n\n$\n\n12.96\n\n \n\n \n\nThere was no stock-based compensation expense related to stock options during 2025 or 2024.\n\nOptions outstanding and exercisable at year‑end 2025 were as follows:\n\n \n\n \n\n \n\nOutstanding\n\n \n\n \n\nExercisable\n\n \n\nGrant Date\n\n \n\nNumber\n\nOutstanding\n\n \n\nWeighted\n\nAverage\n\nRemaining\n\nContractual\n\nLife\n\n \n\nWeighted\n\nAverage\n\nExercise\n\nPrice\n\n \n\n \n\nAggregate\n\nIntrinsic\n\nValue\n\n \n\n \n\nNumber\n\nOutstanding\n\n \n\n \n\nWeighted\n\nAverage\n\nExercise\n\nPrice\n\n \n\n \n\nAggregate\n\nIntrinsic\n\nValue\n\n \n\nFebruary 24, 2016\n\n \n\n \n\n12,500\n\n \n\n \n\n$\n\n12.96\n\n \n\n \n\n \n\n \n\n \n\n \n\n12,500\n\n \n\n \n\n$\n\n12.96\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n12,500\n\n \n\n0.12 years\n\n \n\n$\n\n12.96\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n \n\n12,500\n\n \n\n \n\n$\n\n12.96\n\n \n\n \n\n$\n\n–\n\n \n\nStock Awards to Directors\n\nIn March 2025 and May 2024, the Company awarded 23,232\nand 19,832 shares of common stock, respectively, to its directors under the LTIP, which are fully vested. The Company recorded $168 thousand and $96 thousand of\ncompensation expense in the years ended December 31, 2025 and December 31, 2024, respectively, based on the fair value of the stock on the date of the award.\n\nRestricted Stock\nAwards to Employees\n\nIn March 2022, the Company issued 61,908 shares of restricted stock to its officers\nand employees under the LTIP, of which 23,379 shares have been forfeited as of December 31, 2025. Each restricted stock award\nwas valued based on the fair value of the stock on the date of the award. These awarded shares of restricted stock fully vest over periods ranging from 36 months to 60 months from their respective dates of grant.\nStock-based compensation is recognized on a straight-line basis over the vesting period.  During 2025 and 2024, the Company recorded $41\nthousand and $88 thousand, respectively, of stock-based compensation expense related to shares awarded to employees.\n\nOn June 21, 2023, the Company issued 92,720 shares of restricted stock to its officers and employees under the Amended and Restated LTIP, of which 30,072 shares have been forfeited as of December 31, 2025. Each restricted stock award was valued based on the fair value of the stock on the date\nof the award. These awarded shares of restricted stock fully vest over periods ranging from 36 months to 60 months from their respective dates of grant. Stock-based compensation is recognized on a straight-line basis over the vesting period. During\nthe years ended December 31, 2025 and 2024, the Company recorded $60 thousand and $113 thousand, respectively, of stock-based compensation expense related to these restricted stock awards.\n\nOn March 25, 2024, and April 5, 2024, the Company\nissued a total of 126,083 shares of restricted stock to its officers and employees under the Amended and Restated LTIP, of\nwhich 26,356 shares have been forfeited as of December 31, 2025. Each restricted stock award was valued based on the fair value of\nthe stock on the date of the award. These awarded shares of restricted stock fully vest over periods ranging from 36 months to 60 months from their respective dates of grant.  Stock-based compensation is recognized on a straight-line basis over the vesting period. During\nthe years ended December 31, 2025 and 2024, the Company recorded $94 thousand and $108 thousand, respectively, of stock-based compensation expense related to these restricted stock awards.\n\nOn March 26, 2025 and May 28, 2025, the Company issued\na total of 96,478 shares of restricted stock to its officers and employees under the Amended and Restated LTIP, of which 17,048 shares have been forfeited as of December 31, 2025. Each restricted stock award was valued based on the fair value of the stock on the date\nof the award. These awarded shares of restricted stock fully vest over periods ranging from 36 months to 48 months from their respective dates of grant.  Stock-based compensation is recognized on a straight-line basis over the vesting period. During\nthe year ended December 31, 2025, the Company recorded $114 thousand of stock-based compensation expense related to these\nrestricted stock awards.\n\nAs of December 31, 2025, 367,181 shares had been awarded under the Amended and Restated LTIP and 281,958 shares were available to be awarded.\n\nF-28\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nA summary of restricted stock unit activity for the year ended December 31, 2025 is as follows:\n\n  \n\n \n\nRestricted Stock Units\n\n(In thousands)\n\n \n\n \n\nWeighted Average\n\nGrant Date Fair Value\n\n \n\n \n\nRemaining\n\nContractual Life\n\n(months)\n\n \n\nUnvested at December 31, 2024\n\n \n\n \n\n184,874\n\n \n\n \n\n$\n\n8.91\n\n \n\n \n\n \n\n31\n\n \n\nGranted during period\n\n \n\n \n\n119,710\n\n \n\n \n\n7.15\n\n \n\n \n\n \n\n29\n\n \n\nVested during period\n\n \n\n \n\n(95,566\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nForfeited or expired during period\n\n \n\n \n\n(59,313\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nUnvested at December 31, 2025\n\n \n\n \n\n149,705\n\n \n\n \n\n$\n\n8.50\n\n \n\n \n\n \n\n24\n\n \n\nAs of December 31, 2025, there was $1.8 million of total\nunrecognized equity-based compensation expense that the Company expects to recognize over the remaining contractual life.\n\nNote 16 – Regulatory Matters\n\n \n\nThe Bank’s capital\nrequirements are administered by the Office of the Comptroller of the Currency (“OCC”) and involve quantitative measures of assets, liabilities, and certain off-balance sheet items calculated under regulatory accounting practices. Capital\namounts and classifications are also subject to qualitative judgments by the OCC. Failure to meet capital requirements can result in regulatory action.\n\nAs a result of the\nEconomic Growth, Regulatory Relief, and Consumer Protection Act, the federal banking agencies have developed a “Community Bank Leverage Ratio” (“CBLR”) (the ratio of a bank’s tier 1 capital to average total consolidated assets) for financial\ninstitutions with assets of less than $10 billion. A “qualifying community bank” that exceeds this ratio will be deemed to be in compliance with all other capital and leverage requirements, including the capital requirements to be considered\n“well capitalized” under Prompt Corrective Action statutes. The federal banking agencies have set the Community Bank Leverage Ratio at 9%. Actual and required capital amounts and ratios as of the dates indicated are presented below:\n\n \n\n \n\nActual\n\n \n\n \n\nMinimum Required to be\n\nWell Capitalized Under\n\nPrompt Corrective\n\nAction Provisions\n\n \n\n \n\n \n\nAmount\n\n \n\n \n\nRatio\n\n \n\n \n\nAmount\n\n \n\n \n\nRatio\n\n \n\n \n\n \n\n(Dollars in thousands)\n\n \n\nDecember 31, 2025:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommunity Bank Leverage Ratio\n\n \n\n$\n\n191,336\n\n \n\n \n\n \n\n14.09\n\n%\n\n \n\n$\n\n122,184\n\n \n\n \n\n \n\n9.00\n\n%\n\nDecember 31, 2024:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommunity Bank Leverage Ratio\n\n \n\n$\n\n188,827\n\n \n\n \n\n \n\n13.61\n\n%\n\n \n\n$\n\n124,879\n\n \n\n \n\n \n\n9.00\n\n%\n\nAt\nDecember 31, 2025, the Company and the Bank met all the capital adequacy requirements to which they were subject. In addition, the Bank was “well capitalized” under the regulatory framework for prompt corrective action. Management believes\nthat no conditions or events have occurred that would materially adversely change the Bank’s capital classifications. From time to time, we may need to raise additional capital to support the Bank’s further growth and to maintain the “well\ncapitalized” status.\n\nNote 17 – Loan Commitments and Other Related Activities\n\n \n\nSome financial instruments, such as loan commitments, credit lines, letters of credit, and overdraft protection, are issued to meet customer financing needs. These\nare agreements to provide credit or to support the credit of others, as long as conditions established in the contract are met, and usually have expiration dates. Commitments may expire without being used. Off‑balance‑sheet risk for credit loss\nexists up to the face amount of these instruments, although material losses are not anticipated. The same credit policies are used to make such commitments as are used for loans, including obtaining collateral at exercise of the commitment.\n\nThe contractual amounts of financial instruments with off‑balance‑sheet risk at year‑end were as follows:\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nCommitments to make loans\n\n \n\n$\n\n2,095\n\n \n\n \n\n$\n\n6,201\n\n \n\nUnfunded construction loans\n\n \n\n \n\n19,253\n\n \n\n \n\n \n\n38,486\n\n \n\nUnused lines of credit – variable rates\n\n \n\n \n\n3,050\n\n \n\n \n\n \n\n3,934\n\n \n\n \n\nCommitments to make loans are generally made for periods of 60\ndays or less.\n\n \n\nF-29\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nNote 18 – Parent Company Only Condensed Financial Information\n\n \n\nCondensed financial information of Broadway Financial Corporation follows:\n\n \n\nCondensed Balance Sheets\n\nDecember 31,\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nAssets\n\n \n\n \n\n \n\n \n\n \n\n \n\nCash and cash equivalents\n\n \n\n$\n\n70,165\n\n \n\n \n\n$\n\n73,172\n\n \n\nInvestment in bank subsidiary\n\n \n\n \n\n187,152\n\n \n\n \n\n \n\n205,744\n\n \n\nOther assets\n\n \n\n \n\n5,601\n\n \n\n \n\n \n\n6,161\n\n \n\nTotal assets\n\n \n\n$\n\n262,918\n\n \n\n \n\n$\n\n285,077\n\n \n\nLiabilities and stockholders’ equity\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAccrued expenses and other liabilities\n\n \n\n$\n\n167\n\n \n\n \n\n$\n\n104\n\n \n\nStockholders’ equity\n\n \n\n \n\n262,751\n\n \n\n \n\n \n\n284,973\n\n \n\nTotal liabilities and stockholders’ equity\n\n \n\n$\n\n262,918\n\n \n\n \n\n$\n\n285,077\n\n \n\n \n\nCondensed Statements of Income\n\nYears Ended December 31,\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nInterest income\n\n \n\n$\n\n260\n\n \n\n \n\n$\n\n283\n\n \n\nInterest expense\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nOther expense\n\n \n\n \n\n(1,125\n\n)\n\n \n\n \n\n(988\n\n)\n\nLoss before income tax and undistributed subsidiary income\n\n \n\n \n\n(865\n\n)\n\n \n\n \n\n(705\n\n)\n\nIncome tax benefits\n\n \n\n \n\n235\n\n \n\n \n\n \n\n209\n\n \n\nEquity in undistributed subsidiary (loss) income\n\n \n\n \n\n(24,165\n\n)\n\n \n\n \n\n2,425\n\n \n\nNet (loss) income\n\n \n\n$\n\n(24,795\n\n)\n\n \n\n$\n\n1,929\n\n \n\n \n\nCondensed Statements of Cash Flows\n\nYears Ended December 31,\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n \n\n(In thousands)\n\n \n\nCash flows from operating activities\n\n \n\n \n\n \n\n \n\n \n\n \n\nNet (loss) income\n\n \n\n$\n\n(24,795\n\n)\n\n \n\n$\n\n1,929\n\n \n\nAdjustments to reconcile net (loss) income to net cash used in operating activities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nEquity in undistributed subsidiary loss (income)\n\n \n\n \n\n24,165\n\n \n\n \n\n \n\n(2,425\n\n)\n\nStock awards expenses\n\n \n\n \n\n625\n\n \n\n \n\n \n\n593\n\n \n\nChange in other assets\n\n \n\n \n\n(242\n\n)\n\n \n\n \n\n(2,927\n\n)\n\nChange in accrued expenses and other liabilities\n\n \n\n \n\n63\n\n \n\n \n\n \n\n(290\n\n)\n\nNet cash used in operating activities\n\n \n\n \n\n(184\n\n)\n\n \n\n \n\n(3,120\n\n)\n\nCash flows from financing activities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDividends declared and paid- ECIP\n\n \n\n \n\n(3,000\n\n)\n\n \n\n \n\n(1,567\n\n)\n\nCity First Bank Fund Manager II distribution\n\n \n\n \n\n(170\n\n)\n\n \n\n \n\n–\n\n \n\nProceeds from repayment of ESOP loan\n\n \n\n \n\n347\n\n \n\n \n\n \n\n402\n\n \n\nNet cash used in financing activities\n\n \n\n \n\n(2,823\n\n)\n\n \n\n \n\n(1,165\n\n)\n\nNet change in cash and cash equivalents\n\n \n\n \n\n(3,007\n\n)\n\n \n\n \n\n(4,285\n\n)\n\nBeginning cash and cash equivalents\n\n \n\n \n\n73,172\n\n \n\n \n\n \n\n77,457\n\n \n\nEnding cash and cash equivalents\n\n \n\n$\n\n70,165\n\n \n\n \n\n$\n\n73,172\n\n \n\n \n\nF-30\n\n[Table of Contents](#TABLEOFCONTENTS)\n\nNote 19 – (Loss) Earnings Per Common Share\n\n \n\nThe factors used in the earnings per common share computation follow:\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n \n\n(In thousands,\n\nexcept share and per share)\n\n \n\nNet income attributable to Broadway Financial Corporation\n\n \n\n$\n\n(24,795\n\n)\n\n \n\n$\n\n1,929\n\n \n\nLess: Net income attributable to participating securities\n\n \n\n \n\n–\n\n \n\n \n\n \n\n(8\n\n)\n\nLess: Preferred stock dividends -  ECIP\n\n \n\n \n\n(3,000\n\n)\n\n \n\n \n\n(1,567\n\n)\n\nIncome available to common stockholders\n\n \n\n$\n\n(27,795\n\n)\n\n \n\n$\n\n354\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nWeighted average common shares outstanding for basic earnings per common share\n\n \n\n \n\n8,595,254\n\n \n\n \n\n \n\n8,459,460\n\n \n\nAdd: Effects of unvested restricted stock awards\n\n \n\n \n\n–\n\n \n\n \n\n \n\n179,200\n\n \n\nWeighted average common shares outstanding for diluted earnings per common share\n\n \n\n \n\n8,595,254\n\n \n\n \n\n \n\n8,638,660\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nEarnings per common share - basic\n\n \n\n$\n\n(3.23\n\n)\n\n \n\n$\n\n0.04\n\n \n\nEarnings per common share - diluted\n\n \n\n$\n\n(3.23\n\n)\n\n \n\n$\n\n0.04\n\n \n\n \n\nStock options for 12,500 shares of common stock\nfor the years ended December 31, 2025 and 2024, were not considered in computing diluted earnings per common share because they were anti‑dilutive.\n\n \n\nBasic earnings per share of common stock is computed pursuant to the two-class method by dividing net loss\navailable to common stockholders less dividends paid on participating securities (unvested shares of restricted common stock) and any undistributed loss attributable to participating securities by the weighted average common shares outstanding\nduring the period. The weighted average common shares outstanding includes the weighted average number of shares of common stock outstanding less the weighted average number of unvested shares of restricted common stock. ESOP shares are\nconsidered outstanding for this calculation unless unearned. Diluted earnings per share of common stock includes the dilutive effect of unvested stock awards and additional potential common shares issuable under stock options. No unvested stock awards or potential common shares issuable under stock options were included in diluted earnings per share in either year.\n\n \n\nF-31"}