QUAINT OAK BANCORP, INC.

CEO’S LETTER TO SHAREHOLDERS

To Our Valued Shareholders:

On behalf of the Board of Directors, Senior Management and Team Members of the Quaint Oak Family of Companies, I am pleased to present our 2025 Annual Report to Shareholders.

The year 2025 was defined by disciplined execution, strategic expansion, and a continued commitment to building the future of Quaint Oak. In an operating environment that has remained dynamic and competitive, our team delivered steady performance while advancing the core initiatives that position us for long term, sustainable growth.

Throughout the year, we strengthened our foundation as a diversified financial services company—one that balances the stability of traditional community banking with the additional reach and capabilities of our specialty platforms. Our SBA initiative continued to scale, supported by expanding production capacity and deepening referral networks. Specialty real estate financing remained a key contributor, and our international correspondent banking platform was further enhanced to serve customers with speed, expertise, and tailored solutions going forward.

We continued investing in our talent, technology, and risk management infrastructure—areas that are essential to maintaining the strong internal controls and regulatory compliance our shareholders expect. These investments ensure that as we grow, we do so with financial resilience, efficiency, and a clear focus on regulatory expectations and best practices.

As we look ahead, we remain focused on executing the strategic priorities that will drive value creation: expanding our specialty capabilities, enhancing operational efficiency, strengthening core banking performance, and fostering a culture rooted in teamwork, transparency, and excellence. While the financial services industry continues to evolve in correspondent banking, our overall strategy is built for consistency and adaptability—qualities that define who we are and how we operate.

This progress is made possible by the dedication of our employees, the trust of our customers, and the continued support of our shareholders. I remain deeply proud of our team and confident in the opportunities before us.

As always, our current and continued business strategy focuses on long-term profitability, sound credit quality, and maintaining healthy capital ratios, reflecting our strong commitment to shareholder value. Thank you for your continued confidence in Quaint Oak Bancorp, Inc. I look forward to the year ahead and to building, together, on the momentum we have created.

Sincerely,

Robert T. Strong

Chief Executive Officer

TABLE OF CONTENTS

General

Quaint Oak Bancorp, Inc. (the “Company”) was formed in connection with Quaint Oak Bank’s (the “Bank”) conversion to a stock savings bank completed on July 3, 2007. The Company’s results of operations are dependent primarily on the results of Quaint Oak Bank, a wholly owned subsidiary of the Company, along with the Bank’s wholly owned subsidiaries. The Bank, a Pennsylvania-chartered stock savings bank, is headquartered in Southampton, Pennsylvania and conducts business through three regional offices located in the Delaware Valley, Lehigh Valley and Philadelphia markets. At December 31, 2025, the Bank has five active wholly-owned subsidiaries, Quaint Oak Mortgage, LLC, Quaint Oak Abstract, LLC, QOB Properties, LLC, Quaint Oak Insurance Agency, LLC, and Oakmont Commercial, LLC, each a Pennsylvania limited liability company. On March 29, 2024, Quaint Oak Bank sold its 51% interest in Oakmont Capital Holdings, LLC (“OCH”), a multi-state equipment finance company based in West Chester, Pennsylvania. The decision was based on a number of strategic priorities and other factors. As a result of this action, Quaint Oak Bancorp classified the operations of OCH as discontinued operations under ASC 205-20. Also on March 29, 2024, the Company discontinued the operations of Quaint Oak Real Estate, LLC, a 100% wholly owned subsidiary of the Bank engaged in the real estate brokerage business. All significant intercompany balances and transactions have been eliminated.

Quaint Oak Mortgage offers mortgage banking services in the Lehigh Valley, Delaware Valley and Philadelphia County region of Pennsylvania, including conventional, FHA, VA, and USDA loans, almost all of which are underwritten to GSE-guidelines for sale in the secondary market. In February 2019, Quaint Oak Mortgage opened a mortgage banking office in Philadelphia, Pennsylvania. Oakmont Commercial, LLC began operations in October 2021 and operates as a multi-state specialty commercial real estate financing company, providing loans for commercial real estate purchases, refinancing, and development projects to small businesses primarily on the East Coast and generally in the Mid-Atlantic and Southeast. Oakmont Commercial focuses on originations of low loan-to-value, high yield, primarily owner-occupied commercial real estate collateralized loans to be sold in the secondary market to institutional and bank buyers. Quaint Oak Abstract began operation in July 2009 offering title insurance, primarily in the Lehigh Valley and Bucks County regions of Pennsylvania. QOB Properties, LLC began operations in July 2012 and holds Bank properties acquired through a foreclosure proceeding or acceptance of a deed in lieu of foreclosure. Quaint Oak Insurance Agency, LLC, located in Southampton, Pennsylvania, began operations in August 2016 and offers comprehensive coverage, including home, auto, life, and business insurance. Quaint Oak Mortgage cross-sells products from Quaint Oak Bank’s title and insurance businesses, Quaint Oak Abstract and Quaint Oak Insurance, to its mortgage customers.

Quaint Oak Bank established international correspondent banking operations in March 2022 and maintains a partnership with one international banking entity based in Puerto Rico that utilizes Quaint Oak Bank to help facilitate U.S. dollar payments. As of December 31, 2025, the international correspondent banking division had $4.4 million, or 0.7%, of deposits.

Quaint Oak Bank’s profitability depends, to a large extent, on net interest income, which is the difference between the income earned on its loan and investment portfolios and the cost of funds, consisting of the interest paid on deposits and borrowings. Results of operations are also affected by provisions for credit losses, fee income and other non-interest income and non-interest expense. Non-interest expense principally consists of compensation, directors’ fees and expenses, office occupancy and equipment expense, data processing expense, professional fees, advertising expense, FDIC deposit insurance assessment, and other expenses.

Quaint Oak Bank’s business consists primarily of originating commercial real estate loans, commercial business loans, one-to-four family residential owner occupied loans and multi-family residential loans, generally within its market area. The market for our deposit customers is generated primarily through local market certificates of deposit and business checking and money market accounts. At December 31, 2025, approximately 42.0% of Quaint Oak Bank’s total deposits were held by customers outside the Commonwealth of Pennsylvania. Our branch offices are primarily cashless. Cash transactions at our branch offices are facilitated through a correspondent banking relationship with another Pennsylvania-based national commercial bank. Our real estate loans are primarily secured by properties in the mid-Atlantic region and are originated through Quaint Oak Mortgage and our subsidiary, Oakmont Commercial, although we have originated loans throughout the continental United States through other relationships we have with brokers. At December 31, 2025, commercial real estate loans and commercial business loans comprise the largest percentage of Quaint Oak Bank’s loan portfolio, before net items, at 56.7% and 17.6%, respectively. Quaint Oak Bank’s loans are primarily funded by certificates of deposit, money market accounts and business checking. At December 31, 2025, certificates of deposit amounted to 59.4% of total deposits compared to 51.1% of total deposits at December 31, 2024. At December 31, 2025, interest bearing checking accounts amounted to 17.7% of total deposits compared to 8.6% at December 31, 2024. At December 31, 2025, money market accounts amounted to 11.8% of total deposits compared to 29.3% of total deposits at December 31, 2024. At December 31, 2025, non-interest bearing checking accounts amounted to 11.0% of total deposits compared to 10.8% of total deposits at December 31, 2024. Management anticipates that certificates of deposit, money market accounts, interest bearing checking, and business checking will continue to be the primary sources of funding for Quaint Oak Bank’s assets.

Our results of operations are significantly affected by general economic and competitive conditions, particularly with respect to changes in interest rates, government policies and actions of regulatory authorities as well as other factors beyond our control. Future changes in applicable law, regulations or government policies may materially affect our financial condition and results of operations.