PROVIDENT FINANCIAL HOLDINGS INC

Previous wording

Provident Financial Holdings, Inc., a Delaware corporation, was organized in January 1996 for the purpose of becoming the holding company of Provident Savings Bank, F.S.B. (the “Bank") upon the Bank’s conversion from a federal mutual to a federal stock savings bank (“Conversion”). The Conversion was completed on June 27, 1996. The Corporation is regulated by the Board of Governors of the Federal Reserve System (“Federal Reserve”). At December 31, 2023, the Corporation had total assets of $1.30 billion, total deposits of $912.0 million and total stockholders’ equity of $129.7 million. The Corporation has not engaged in any significant activity other than holding the stock of the Bank. Accordingly, the information set forth in this report, including financial statements and related data, relates primarily to the Bank and its subsidiaries. As used in this report, the terms “we,” “our,” “us,” and “Corporation” refer to Provident Financial Holdings, Inc. and its consolidated subsidiaries, unless the context indicates otherwise.

Current wording

Provident Financial Holdings, Inc., a Delaware corporation, was organized in January 1996 for the purpose of becoming the holding company of Provident Savings Bank, F.S.B. (the “Bank") upon the Bank’s conversion from a federal mutual to a federal stock savings bank (“Conversion”). The Conversion was completed on June 27, 1996. The Corporation is regulated by the Board of Governors of the Federal Reserve System (“Federal Reserve”). At March 31, 2024, the Corporation had total assets of $1.29 billion, total deposits of $908.1 million and total stockholders’ equity of $129.5 million. The Corporation has not engaged in any significant activity other than holding the stock of the Bank. Accordingly, the information set forth in this report, including financial statements and related data, relates primarily to the Bank and its subsidiaries. As used in this report, the terms “we,” “our,” “us,” and “Corporation” refer to Provident Financial Holdings, Inc. and its consolidated subsidiaries, unless the context indicates otherwise.

Previous wording

The Corporation began paying quarterly cash dividends during the quarter ended September 30, 2002. On October 26, 2023, the Corporation’s Board of Directors declared a quarterly cash dividend of $0.14 per share for the Corporation’s shareholders of record at the close of business on November 16, 2023, which was paid on December 7, 2023. Future declarations or payments of dividends will be subject to the consideration of the Corporation’s Board of Directors, which will consider the Corporation’s financial condition, results of operations, tax considerations, capital requirements, industry standards, legal restrictions, economic conditions and other factors, including the regulatory restrictions which affect the payment of dividends by the Bank to the Corporation. Under Delaware law, dividends may be paid either out of surplus

Current wording

The Corporation began paying quarterly cash dividends during the quarter ended September 30, 2002. On January 25, 2024, the Corporation’s Board of Directors declared a quarterly cash dividend of $0.14 per share for the Corporation’s shareholders of record at the close of business on February 15, 2024, which was paid on March 7, 2024. Future declarations or payments of dividends will be subject to the consideration of the Corporation’s Board of Directors, which will consider the Corporation’s financial condition, results of operations, tax considerations, capital requirements, industry standards, legal restrictions, economic conditions and other factors, including the regulatory restrictions which affect the payment of dividends by the Bank to the Corporation. Under Delaware law, dividends may be paid either out of surplus or, if there is no surplus, out of net profits for the current fiscal year and/or the preceding fiscal year in which the dividend is declared.

Previous wording

This Form 10-Q contains statements that the Corporation believes are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to the Corporation’s financial condition, liquidity, results of operations, plans, objectives, future performance or business. You should not place undue reliance on these statements as they are subject to various risks and uncertainties. When considering these forward-looking statements, you should keep in mind these risks and uncertainties, as well as any cautionary statements the Corporation may make. Moreover, you should treat these statements as speaking only as of the date they are made and based only on information then actually known to the Corporation. There are a number of important factors that could cause future results to differ materially from historical performance and these forward-looking statements. Factors which could cause actual results to differ materially from the results anticipated or implied by our forward-looking statements include, but are not limited to: potential adverse impacts to economic conditions in our local market areas, other markets where the Corporation has lending relationships, or other aspects of the Corporation's business operations or financial markets, including, without limitation, as a result of employment levels, labor shortages and the effects of inflation, a potential recession or slowed economic growth; changes in the interest rate environment, including the past increases in the Board of Governors of the Federal Reserve benchmark rate and duration at which such increased interest rate levels are maintained, which could adversely affect our revenues and expenses, the value of assets and obligations, and the availability and cost of capital and liquidity; the impact of continuing elevated inflation levels and the current and future monetary policies of the Federal Reserve in response thereto; the effects of any federal government shutdown; increased competitive pressures; changes in the interest rate environment; changes in general economic conditions and conditions within the securities markets; fluctuations in deposits; liquidity issues, including our ability to borrow funds or raise additional capital, if necessary; the impact of bank failures or adverse developments at other banks and related negative press about the banking industry in general on investor and depositor sentiment; our ability to attract and retain deposits; our ability to pay dividends on our common stock; legislative and regulatory changes, including changes in banking, securities and tax law, in regulatory policies and principles, or the interpretation of regulatory capital or other rules; disruptions, security breaches, or other adverse events, failures or interruptions in, or attacks on, our information technology systems or on the third-party vendors who perform several of our critical processing functions; the effects of clim…

Excerpt shortened here; the source contains the full paragraph.

Current wording

This Form 10-Q contains statements that the Corporation believes are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to the Corporation’s financial condition, liquidity, results of operations, plans, objectives, future performance or business. You should not place undue reliance on these statements as they are subject to various risks and uncertainties. When considering these forward-looking statements, you should keep in mind these risks and uncertainties, as well as any cautionary statements the Corporation may make. Moreover, you should treat these statements as speaking only as of the date they are made and based only on information then actually known to the Corporation. There are a number of important factors that could cause future results to differ materially from historical performance and these forward-looking statements. Factors which could cause actual results to differ materially from the results anticipated or implied by our forward-looking statements include, but are not limited to: potential adverse impacts to economic conditions in our local market areas, other markets where the Corporation has lending relationships, or other aspects of the Corporation's business operations or financial markets, including, without limitation, as a result of employment levels, labor shortages, a potential recession or slowed economic growth; changes in the interest rate environment, including the past increases in the Board of Governors of the Federal Reserve benchmark rate and duration at which such increased interest rate levels are maintained, which could adversely affect our revenues and expenses, the value of assets and obligations, and the availability and cost of capital and liquidity; the impact of continuing elevated inflation levels and the current and future monetary policies of the Federal Reserve in response thereto; the effects of any federal government shutdown; increased competitive pressures; changes in conditions within the securities markets; fluctuations in deposits; liquidity issues, including our ability to borrow funds or raise additional capital, if necessary; the impact of bank failures or adverse developments at other banks and related negative press about the banking industry in general on investor and depositor sentiment; our ability to attract and retain deposits; our ability to pay dividends on our common stock; legislative and regulatory changes, including changes in banking, securities and tax law, in regulatory policies and principles, or the interpretation of regulatory capital or other rules; disruptions, security breaches, or other adverse events, failures or interruptions in, or attacks on, our information technology systems or on the third-party vendors who perform several of our critical processing functions; the effects of climate change, severe weather events, natural disasters, pandemics, epidemics and other public health cris…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

The Corporation’s critical accounting estimates are described in the Critical Accounting Estimates section of Management’s Discussion and Analysis of Financial Condition and Results of Operations and in Note 1 - Organization and Summary of Significant Accounting Policies of the Notes to Consolidated Financial Statement of our 2023 Annual Form 10-K. The Corporation adopted the current expected credit loss, or CECL, methodology on July 1, 2023. Accounting for the allowance for credit losses (“ACL”) involves significant judgement and assumptions by management and is based on historical data, current economic conditions and a reasonable and supportable forecast of future events. On a quarterly basis, management reviews the methodology and adequacy of the ACL. Refer to Notes 2, 4 and 5 of the Notes to Unaudited Interim Condensed Consolidated Financial Statements, and the “Provision for (Recovery of) Credit Losses” section in this Form 10-Q for more information on the establishment of the ACL and the implementation of CECL.

Current wording

Form 10-K. The Corporation adopted the current expected credit loss, or CECL, methodology on July 1, 2023. Accounting for the allowance for credit losses (“ACL”) involves significant judgement and assumptions by management and is based on historical data, current economic conditions and a reasonable and supportable forecast of future events. On a quarterly basis, management reviews the methodology and adequacy of the ACL. Refer to Notes 2, 4 and 5 of the Notes to Unaudited Interim Condensed Consolidated Financial Statements, and the “Provision for (Recovery of) Credit Losses” section in this Form 10-Q for more information on the establishment of the ACL and the implementation of CECL.

Previous wording

The Corporation, subject to market conditions, intends to improve its community banking business over the next several years by moderately increasing total assets by increasing single-family, multi-family, commercial real estate, construction and commercial business loans. Further, the Corporation intends gradually to decrease the percentage of time deposits in its deposit base and to increase the percentage of lower cost checking and savings accounts, although deposit accounts diversification will also remain a focus. This strategy is intended to improve core revenue through a higher net interest margin and ultimately, coupled with the growth of the Corporation, an increase in net interest income. While the Corporation’s long-term strategy is for moderate growth, management recognizes that growth may be challenging given the uncertainty of current general economic conditions and the high interest rate environment.

Current wording

The Corporation, subject to market conditions, intends to improve its community banking business over the next several years by moderately increasing total assets by increasing single-family, multi-family, commercial real estate, construction and commercial business loans. Further, the Corporation intends to gradually decrease the percentage of time deposits in its deposit base and to increase the percentage of lower cost checking and savings accounts, although deposit account diversification will also remain a focus. This strategy is intended to improve core revenue through a higher net interest margin and ultimately, coupled with the growth of the Corporation, an increase in net interest income. While the Corporation’s long-term strategy is for moderate growth, management recognizes that growth may be challenging given the uncertainty of current general economic conditions, the high interest rate environment and the inverted yield curve.

Previous wording

There are a number of risks associated with the business activities of the Corporation, many of which are beyond the Corporation’s control as described in the Corporation’s 2023 Annual Form 10-K. The Corporation attempts to mitigate many of these risks through prudent banking practices, such as interest rate risk management, credit risk management, operational risk management, and liquidity risk management. The California economic environment presents heightened risk for the Corporation primarily with respect to real estate values and loan delinquencies. Since the majority of the Corporation’s loans are secured by real estate located within California, significant declines in the value of California real estate may also inhibit the Corporation’s ability to recover on defaulted loans by selling the underlying real estate.

Current wording

There are a number of risks associated with the business activities of the Corporation, many of which are beyond the Corporation’s control as described in the Corporation’s 2023 Annual Form 10-K. The Corporation attempts to mitigate many of these risks through prudent banking practices, such as interest rate risk management, credit risk management, operational risk management, and liquidity risk management. The California economic environment presents heightened risk for the Corporation primarily with respect to real estate values and loan delinquencies. Since the majority of the Corporation’s loans are secured by real estate located within California, significant declines in the value of California real estate may also inhibit the Corporation’s ability to recover on defaulted loans by selling the underlying real estate. The commercial real estate environment, particularly office space of various types, currently presents elevated risk within the banking industry. In response, the Bank has reviewed its existing office space exposure for any outsized exposure and implemented tighter underwriting standards for this collateral type. At March 31, 2024, our commercial real estate portfolio totaled $83.1 million, including office space of various types, totaling approximately $41.8 million or 50.3 percent of the total commercial real estate portfolio and 3.9 percent of the total loan portfolio.

Previous wording

originating loans or providing funds under existing lines of credit, loan sale agreements to third parties and option contracts. These instruments involve, to varying degrees, elements of credit and interest-rate risk in excess of the amount recognized in the accompanying Condensed Consolidated Statements of Financial Condition. The Corporation’s exposure to credit loss, in the event of non-performance by the counterparty to these financial instruments, is represented by the contractual amount of these instruments. The Corporation uses the same credit policies in entering into financial instruments with off-balance sheet risk as it does for on-balance sheet instruments. For a discussion on commitments and derivative financial instruments, see Note 6 of the Notes to Unaudited Interim Condensed Consolidated Financial Statements of this Form 10-Q.

Current wording

The Corporation is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit, in the form of originating loans or providing funds under existing lines of credit, loan sale agreements to third parties and option contracts. These instruments involve, to varying degrees, elements of credit and interest-rate risk in excess of the amount recognized in the accompanying Condensed Consolidated Statements of Financial Condition. The Corporation’s exposure to credit loss, in the event of non-performance by the counterparty to these financial instruments, is represented by the contractual amount of these instruments. The Corporation uses the same credit policies in entering into financial instruments with off-balance sheet risk as it does for on-balance sheet instruments. For a discussion on commitments and derivative financial instruments, see Note 6 of the Notes to Unaudited Interim Condensed Consolidated Financial Statements of this Form 10-Q.

Previous wording

Total assets decreased two percent to $1.30 billion at December 31, 2023 from $1.33 billion at June 30, 2023. The decrease was primarily attributable to decreases in cash and cash equivalents and investment securities.

Current wording

Total assets decreased three percent to $1.29 billion at March 31, 2024 from $1.33 billion at June 30, 2023. The decrease was primarily attributable to decreases in cash and cash equivalents, investment securities and loans held for investment.

Previous wording

Total cash and cash equivalents, primarily excess cash deposited with the FRB of San Francisco, decreased $18.9 million, or 29 percent, to $46.9 million at December 31, 2023 from $65.8 million at June 30, 2023. The decrease in total cash and cash equivalents was primarily attributable to deposit outflows and management’s proactive strategy to manage liquidity based upon economic conditions.

Current wording

Total cash and cash equivalents, primarily excess cash deposited with the FRB of San Francisco, decreased $14.1 million, or 21 percent, to $51.7 million at March 31, 2024 from $65.8 million at June 30, 2023. The decrease in total cash and cash equivalents was primarily attributable to deposit outflows and management’s proactive strategy to manage liquidity based upon recent economic conditions.

Previous wording

Investment securities (held to maturity and available for sale) decreased $12.8 million, or eight percent, to $143.7 million at December 31, 2023 from $156.5 million at June 30, 2023. The decrease was primarily the result of scheduled and accelerated principal payments on mortgage-backed and other securities during the first six months of fiscal 2024. For further analysis on investment securities, see Note 4 of the Notes to Unaudited Interim Condensed Consolidated Financial Statements of this Form 10-Q.

Current wording

Investment securities (held to maturity and available for sale) decreased $18.6 million, or 12 percent, to $137.9 million at March 31, 2024 from $156.5 million at June 30, 2023. The decrease was primarily the result of scheduled and accelerated principal payments on mortgage-backed and other securities during the first nine months of fiscal 2024. For further analysis on investment securities, see Note 4 of the Notes to Unaudited Interim Condensed Consolidated Financial Statements of this Form 10-Q.

Previous wording

Loans held for investment remained essentially unchanged at $1.08 billion at December 31, 2023 as compared to June 30, 2023. During the first six months of fiscal 2024, the Corporation originated $38.7 million of loans held for investment, consisting of single-family, multi-family and commercial real estate loans located throughout California. The Corporation did not purchase any loans from other institutions during the first six months of fiscal 2024. Total loan principal payments during the first six months of fiscal 2024 were $40.8 million, down 32 percent from $59.7 million during the comparable period in fiscal 2023. Single-family loans held for investment at December 31, 2023 and June 30, 2023 totaled $521.9 million and $518.8 million, representing approximately 49 percent and 48 percent of loans held for investment, respectively. Multi-family loans held for investment at December 31, 2023 and June 30, 2023 totaled $458.5 million and $461.1 million, respectively, representing approximately 43 percent of loans held for investment at both dates.

Current wording

Loans held for investment decreased $11.9 million, or one percent, to $1.07 billion at March 31, 2024 from $1.08 billion at June 30, 2023, predominantly due to declines in multi-family and commercial real estate loans. During the first nine months of fiscal 2024, the Corporation originated $56.9 million of loans held for investment, consisting primarily of single-family, multi-family and commercial real estate loans located throughout California. The Corporation did not purchase any loans from other institutions during the first nine months of fiscal 2024. Total loan principal payments during the first nine months of fiscal 2024 were $69.3 million, down 10 percent from $77.2 million during the comparable period in fiscal 2023. Single-family loans held for investment at March 31, 2024 and June 30, 2023 totaled $517.0 million and $518.8 million, representing approximately 49 percent and 48 percent of loans held for investment, respectively. Multi-family loans held for investment at March 31, 2024 and June 30, 2023 totaled $457.4 million and $461.1 million, respectively, representing approximately 43 percent of loans held for investment at both dates. Commercial real estate loans held for investment at March 31, 2024 and June 30, 2023 totaled $83.1 million and $90.6 million, respectively, representing approximately eight percent of loans held for investment at both dates.

Previous wording

Total deposits decreased $38.6 million, or four percent, to $912.0 million at December 31, 2023 from $950.6 million at June 30, 2023, primarily due to a decrease in transaction accounts, partly offset by an increase in time deposits. The decrease in total deposits was primarily due to customers seeking higher interest rates elsewhere. Total uninsured deposits were approximately $140.3 million and $140.1 million at December 31, 2023 and June 30, 2023, respectively. The amounts of uninsured deposits are based on estimated amounts of uninsured deposits as of the reported period. Such estimates are based on the same methodologies and assumptions used for regulatory reporting requirements.

Current wording

Total deposits decreased $42.5 million, or four percent, to $908.1 million at March 31, 2024 from $950.6 million at June 30, 2023, primarily due to a decrease in transaction accounts, partly offset by an increase in time deposits. The decrease in total deposits was primarily due to customers seeking higher interest rates elsewhere. Total uninsured deposits were approximately $136.4 million and $140.1 million at March 31, 2024 and June 30, 2023, respectively. The amounts of uninsured deposits are based on estimated amounts of uninsured deposits as of the reported period. Such estimates are based on the same methodologies and assumptions used for regulatory reporting requirements.

Previous wording

Transaction account balances or “core deposits” decreased $72.0 million, or 10 percent, to $657.6 million at December 31, 2023 from $729.6 million at June 30, 2023, while time deposits increased $33.4 million, or 15 percent, to $254.3 million at December 31, 2023 from $220.9 million at June 30, 2023. The increase in time deposits was due to both increases in retail time deposits and brokered certificates of deposit. Excluding brokered certificates of deposit, the percentage of time deposits to total deposits was 17 percent at December 31, 2023, compared to 14 percent at June 30, 2023. At December 31, 2023 and June 30, 2023, total brokered certificates of deposit were $122.7 million and $106.4 million, respectively.

Current wording

Transaction account balances or “core deposits” decreased $87.4 million, or 12 percent, to $642.2 million at March 31, 2024 from $729.6 million at June 30, 2023, while time deposits increased $45.0 million, or 20 percent, to $265.9 million at March 31, 2024 from $220.9 million at June 30, 2023. The increase in time deposits was due to both increases in retail time deposits and brokered certificates of deposit. Excluding brokered certificates of deposit, the percentage of time deposits to total deposits was 17 percent at March 31, 2024, compared to 14 percent at June 30, 2023. At March 31, 2024 and June 30, 2023, total brokered certificates of deposit were $130.9 million and $106.4 million, respectively.

Previous wording

Total borrowings increased $7.5 million, or three percent, to $242.5 million at December 31, 2023 from $235.0 million at June 30, 2023. The increase in total borrowings was primarily used to augment the decline in total deposits. At December 31, 2023 and June 30, 2023, borrowings were comprised of short-term and long-term FHLB - San Francisco advances used for liquidity and interest rate risk management purposes.

Current wording

Total borrowings were virtually unchanged at $235.0 million at March 31, 2024 and June 30, 2023. At March 31, 2024 and June 30, 2023, borrowings were comprised of short-term and long-term FHLB - San Francisco advances used for liquidity and interest rate risk management purposes.

Previous wording

Total stockholders’ equity remained essentially unchanged at $129.7 million at December 31, 2023 and June 30, 2023. Net income of $3.9 million in the first six months of fiscal 2024 was mainly offset by $2.0 million of cash dividends paid to shareholders, $1.3 million of stock repurchases and the $824,000 impact of the CECL adoption. The Corporation repurchased 98,822 shares of its common stock at a weighted average cost of $12.59 per share during the first six months of fiscal 2024.

Current wording

Total stockholders’ equity declined to $129.5 million at March 31, 2024 from $129.7 million at June 30, 2023. Net income of $5.4 million in the first nine months of fiscal 2024 was mostly offset by $2.9 million of cash dividends paid to shareholders, $2.0 million of stock repurchases and the $824,000 impact of the CECL adoption. The Corporation repurchased 148,873 shares of its common stock at a weighted average cost of $13.06 per share during the first nine months of fiscal 2024.

Previous wording

Comparison of Operating Results for the Quarters and Six Months Ended December 31, 2023 and 2022

Current wording

Comparison of Operating Results for the Quarters and Nine Months Ended March 31, 2024 and 2023

Previous wording

Net income for the second quarter of fiscal 2024 was $2.1 million, down $230,000 or 10 percent from $2.4 million in the same period of fiscal 2023. The decrease in net income was primarily attributable to a $611,000 decrease in net interest income and a $546,000 increase in non-interest expense, partly offset by a $911,000 change in the provision for credit losses to a $720,000 recovery of credit losses in the second quarter of fiscal 2024, in contrast to a $191,000 provision for credit losses in the same quarter of fiscal 2023.

Current wording

Net income for the third quarter of fiscal 2024 was $1.5 million, down $828,000 or 36 percent from $2.3 million in the same period of fiscal 2023. The decrease in net income was primarily attributable to a $842,000 decrease in net interest income, a $244,000 increase in non-interest expense and a $133,000 decrease in non-interest income.

Previous wording

For the first six months of fiscal 2024, net income was $3.9 million, down $558,000 or 13 percent from $4.5 million in the same period of fiscal 2023. The decrease in net income was attributable to a $437,000 decrease in net interest income, a $333,000 decrease in non-interest income and a $461,000 increase in non-interest expense, partly offset by a $436,000 change in the provision for credit losses to the $175,000 recovery of credit losses in the first six months of fiscal 2024, in contrast to a $261,000 provision for credit losses in the same period in fiscal 2023.

Current wording

For the first nine months of fiscal 2024, net income was $5.4 million, down $1.4 million. or 20 percent from $6.8 million in the same period of fiscal 2023. The decrease in net income was attributable to a $1.3 million decrease in net interest income, a $705,000 increase in non-interest expense and a $466,000 decrease in non-interest income, partly offset by a $481,000 change in the provision for credit losses to a $51,000 recovery of credit losses in the first nine months of fiscal 2024, in contrast to a $430,000 provision for credit losses in the same period in fiscal 2023.

Previous wording

The efficiency ratio, defined as non-interest expense divided by the sum of net interest income and non-interest income, was 76.11 percent for the second quarter of fiscal 2024, compared to 65.74 percent in the same period last year. For the first six months of fiscal 2024, the efficiency ratio was 72.68 percent, compared to 67.65 percent for the same period of fiscal 2023. The deterioration of the efficiency ratio during the current quarter and six-month period compared to the same periods last year was due both to higher non-interest expenses and lower total revenues.

Current wording

The efficiency ratio, defined as non-interest expense divided by the sum of net interest income and non-interest income, was 76.20 percent for the third quarter of fiscal 2024, compared to 66.69 percent in the same period last year. For the first nine months of fiscal 2024, the efficiency ratio was 73.82 percent, compared to 67.33 percent for the same period of fiscal 2023. The deterioration of the efficiency ratio during the current quarter and nine-month period compared to the same periods last year was due both to higher non-interest expenses and lower total revenues.

Previous wording

Return on average assets was 0.66 percent in the second quarter of fiscal 2024, down nine basis points from 0.75 percent in the same period last year. For the first six months of fiscal 2024, return on average assets was 0.60 percent, down 12 basis points from 0.72 percent in the same period last year.

Current wording

Return on average assets was 0.47 percent in the third quarter of fiscal 2024, down 25 basis points from 0.72 percent in the same period last year. For the first nine months of fiscal 2024, return on average assets was 0.56 percent, down 16 basis points from 0.72 percent in the same period last year.

Previous wording

Return on average stockholders’ equity was 6.56 percent in the second quarter of fiscal 2024, down from 7.27 percent in the same period last year. For the first six months of fiscal 2024, return on average stockholders’ equity was 5.98 percent, down from 6.85 percent in the same period last year.

Current wording

Return on average stockholders’ equity was 4.57 percent in the third quarter of fiscal 2024, down from 7.12 percent in the same period last year. For the first nine months of fiscal 2024, return on average stockholders’ equity was 5.51 percent, down from 6.94 percent in the same period last year.

Previous wording

Diluted earnings per share for the second quarter of fiscal 2024 were $0.31, down six percent from $0.33 in the same period last year. For the first six months of fiscal 2024, diluted earnings per share were $0.56, down eight percent from $0.61 in the same period last year.

Current wording

Diluted earnings per share for the third quarter of fiscal 2024 were $0.22, down 33 percent from $0.33 in the same period last year. For the first nine months of fiscal 2024, diluted earnings per share were $0.77, down 18 percent from $0.94 in the same period last year.

Previous wording

**For the Quarters Ended December 31, 2023 and 2022.**Net interest income decreased $611,000 or seven percent to $8.8 million from $9.4 million for the same quarter last year. The decrease in net interest income was due to a lower net interest margin, partly offset by higher average earning assets. The lower net interest margin was due to increases in the weighted average cost of customer deposits and borrowings, partly offset by an increase in the average yield on interest-earning assets reflecting increases in all earning asset categories. The net interest margin during the second quarter of fiscal 2024 decreased 27 basis points to 2.78 percent from 3.05 percent in the same quarter last year. The average yield on interest-earning assets increased 70 basis points to 4.33 percent in the second quarter of fiscal 2024 from 3.63 percent in the same quarter last year, while the average cost of interest-bearing liabilities increased 106 basis points to 1.69 percent in the second quarter of fiscal 2024 from 0.63 percent in the same quarter last year. The average balance of interest-earning assets increased three percent to $1.26 billion in the second quarter of fiscal 2024 from $1.23 billion in the same quarter last year. The increase in earning assets was primarily due to increases in the average balance of loans receivable and interest-earning deposits, partly offset by a decrease in the average balance of investment securities. The average balance of interest-bearing liabilities increased $29.1 million, or three percent, to $1.15 billion in the second quarter of fiscal 2024 from $1.12 billion in the same quarter last year primarily reflecting an increase in the average balance of borrowings and time deposits, partly offset by a decrease in the average balance of core deposits or transaction accounts.

Current wording

**For the Quarters Ended March 31, 2024 and 2023.**Net interest income decreased $842,000 or nine percent to $8.6 million for the third quarter of fiscal 2024 from $9.4 million for the same quarter last year. The decrease in net interest income was due to a lower net interest margin and, to a lesser extent, a lower average balance of interest-earning assets. The lower net interest margin was due to the increase in the average cost of interest-bearing liabilities which exceeded the increase in the average yield on interest-earning assets. The net interest margin during the third quarter of fiscal 2024 decreased 26 basis points to 2.74 percent from 3.00 percent in the same quarter last year. The average yield on interest-earning assets increased 58 basis points to 4.41 percent in the third quarter of fiscal 2024 from 3.83 percent in the same quarter last year, while the average cost of interest-bearing liabilities increased 93 basis points to 1.86 percent in the third quarter of fiscal 2024 from 0.93 percent in the same quarter last year. The average balance of interest-earning assets decreased slightly to $1.25 billion in the third quarter of fiscal 2024 as compared to the same quarter last year. The slight decrease in interest-earning assets was primarily due to a decrease in the average balance of investment securities, partly offset by increases in the average balance of loans receivable and interest-earning deposits. The average balance of interest-bearing liabilities decreased $4.1 million, or one percent, to $1.13 billion in the third quarter of fiscal 2024 from $1.14 billion in the same quarter last year primarily reflecting decreases in the average balance of core deposits or transaction accounts, partly offset by increases in the average balance of borrowings and time deposits.

Previous wording

For the Six Months Ended December 31, 2023 and 2022. Net interest income decreased $437,000 or two percent to $17.9 million for the first six months of fiscal 2024 from $18.4 million in the same period in fiscal 2023, as a result of a lower net interest margin, partly offset by a higher average balance of interest-earning assets. The net interest margin was 2.83 percent in the first six months of fiscal 2024, a decrease of 22 basis points from 3.05 percent in the same period of fiscal 2023, primarily due to the increase in the average cost of interest-bearing liabilities which exceeded the increase in the average yield on interest-earning assets. The weighted-average cost of interest-bearing liabilities increased by 108 basis points to 1.57 percent for the first six months of fiscal 2024 as compared to 0.49 percent in the same period last year, while the weighted-average yield on interest-earning assets increased by 77 basis points to 4.27 percent in the first six months of fiscal 2024 from 3.50 percent in the same period last year. The average balance of interest-earning assets increased $63.2 million, or five percent, to $1.27 billion in the first six months of fiscal 2024 from $1.20 billion in the comparable period of fiscal 2023, primarily reflecting increases in the average balance of loans receivable and interest-earning deposits, partly offset by a decrease in the average balance of investment securities. The average balance of interest-bearing liabilities increased by $58.6 million, or five percent, to $1.15 billion in the first six months of fiscal 2024 from $1.09 billion in the same period last year primarily reflecting increases in the average balance of borrowings and time deposits, partly offset by the decrease in average balance of transaction accounts.

Current wording

points to 1.67 percent for the first nine months of fiscal 2024 as compared to 0.64 percent in the same period last year, while the weighted-average yield on interest-earning assets increased by 70 basis points to 4.31 percent in the first nine months of fiscal 2024 from 3.61 percent in the same period last year. The average balance of interest-earning assets increased $41.1 million, or three percent, to $1.26 billion in the first nine months of fiscal 2024 from $1.22 billion in the comparable period of fiscal 2023, primarily reflecting increases in the average balance of loans receivable and interest-earning deposits, partly offset by a decrease in the average balance of investment securities. The average balance of interest-bearing liabilities increased by $38.0 million, or three percent, to $1.14 billion in the first nine months of fiscal 2024 from $1.11 billion in the same period last year primarily reflecting increases in the average balance of borrowings and time deposits, partly offset by the decrease in average balance of transaction accounts.

Previous wording

**For the Quarters Ended December 31, 2023 and 2022.**Total interest income increased $2.5 million, or 22 percent, to $13.7 million for the second quarter of fiscal 2024 from $11.2 million for the same quarter of fiscal 2023. The increase was due primarily to an increase in interest income from loans receivable.

Current wording

**For the Quarters Ended March 31, 2024 and 2023.**Total interest income increased $1.8 million, or 15 percent, to $13.8 million for the third quarter of fiscal 2024 from $12.0 million for the same quarter of fiscal 2023. The increase was due primarily to an increase in interest income from loans receivable.

Previous wording

Interest income on loans receivable increased $2.3 million, or 22 percent, to $12.5 million in the second quarter of fiscal 2024 from $10.2 million in the same quarter of fiscal 2023. The increase was due to a higher average yield and, to a lesser extent, a higher average balance. The average yield on loans receivable increased 65 basis points to 4.66 percent in the second quarter of fiscal 2024 from an average yield of 4.01 percent in the same quarter last year. The higher weighted average loan yield was due primarily to the repricing of adjustable rate loans and new loan originations with higher weighted average interest rates. Adjustable-rate loans of approximately $89.3 million were repriced upward in the second quarter of fiscal 2024 by approximately 97 basis points from an average yield of 6.34 percent to 7.31 percent. The average balance of loans receivable increased $53.0 million, or five percent, to $1.07 billion in the second quarter of fiscal 2024 from $1.02 billion in the same quarter last year. Net deferred loan cost amortization in the second quarter of fiscal 2024 increased seven percent to $217,000 from $203,000 in the same quarter last year. Total loans originated for investment in the second quarter of fiscal 2024 were $20.2 million, down 73 percent from $74.3 million in the same quarter last year. Loan principal payments received in the second quarter of fiscal 2024 were $17.8 million, down 36 percent from $28.0 million in the same quarter last year.

Current wording

Interest income on loans receivable increased $1.7 million, or 15 percent, to $12.7 million in the third quarter of fiscal 2024 from $11.0 million in the same quarter of fiscal 2023. The increase was due to a higher average yield and, to a lesser extent, a higher average balance. The average yield on loans receivable increased 56 basis points to 4.74 percent in the third quarter of fiscal 2024 from an average yield of 4.18 percent in the same quarter last year. The higher weighted average loan yield was due primarily to the upward repricing of adjustable rate loans and new loan originations with higher weighted average interest rates. Adjustable-rate loans of approximately $112.9 million were repriced upward in the third quarter of fiscal 2024 by approximately 97 basis points from an average yield of 6.72 percent to 7.69 percent. The average balance of loans receivable increased $16.6 million, or two percent, to $1.07 billion in the third quarter of fiscal 2024 from $1.05 billion in the same quarter last year. Net deferred loan cost amortization in the third quarter of fiscal 2024 increased 12 percent to $255,000 from $228,000 in the same quarter last year. Total loans originated for investment in the third quarter of fiscal 2024 were $18.2 million, down 66 percent from $53.9 million in the same quarter last year; while loan principal payments received in the third quarter of fiscal 2024 were $28.5 million, up 63 percent from $17.5 million in the same quarter last year.

Previous wording

Interest income from investment securities decreased $24,000, or four percent, to $524,000 in the second quarter of fiscal 2024 from $548,000 for the same quarter of fiscal 2023. This decrease was attributable to a lower average balance, partly offset by a higher average yield. The average balance of investment securities decreased $28.0 million, or 16 percent, to $147.2 million in the second quarter of fiscal 2024 from $175.2 million in the same quarter last year. The decrease in the average balance of investment securities was primarily the result of scheduled and accelerated principal payments on mortgage-backed securities. The average yield on investment securities increased 17 basis points to 1.42 percent in the second quarter of fiscal 2024 from 1.25 percent for the same quarter last year. The increase in the average yield was primarily attributable to a lower premium amortization during the current quarter in comparison to the same quarter last year ($137,000 vs. $203,000) due to lower total principal repayments ($5.9 million vs. $7.6 million) and the upward repricing of adjustable-rate mortgage-backed securities.

Current wording

Interest income from investment securities decreased $31,000, or six percent, to $517,000 in the third quarter of fiscal 2024 from $548,000 for the same quarter of fiscal 2023. This decrease was attributable to a lower average balance, partly offset by a higher average yield. The average balance of investment securities decreased $26.3 million, or 16 percent, to $141.4 million in the third quarter of fiscal 2024 from $167.7 million in the same quarter last year. The decrease in the average balance of investment securities was primarily the result of scheduled and accelerated principal payments on mortgage-backed securities. The average yield on investment securities increased 15 basis points to 1.46 percent in the third quarter of fiscal 2024 from 1.31 percent for the same quarter last year. The increase in the average yield was primarily attributable to a lower premium amortization during the current quarter in comparison to the same quarter last year ($124,000 vs. $181,000) due to lower total principal repayments ($5.7 million vs. $6.9 million) and the upward repricing of adjustable-rate mortgage-backed securities.

Previous wording

The FHLB – San Francisco distributed $197,000 of cash dividends to the Bank on its stock in the second quarter of fiscal 2024, up 36 percent from $145,000 in the same quarter last year. The average balance of FHLB – San Francisco stock in the second quarter of fiscal 2024 was $9.5 million, up 16 percent from $8.2 million in the same quarter of fiscal 2023 while the average yield was 8.29 percent, up 125 basis points from 7.04 percent.

Current wording

The FHLB – San Francisco distributed $210,000 of cash dividends to the Bank on its stock in the third quarter of fiscal 2024, up 44 percent from $146,000 in the same quarter last year. The average balance of FHLB – San Francisco stock in the third quarter of fiscal 2024 was $9.5 million, up 16 percent from $8.2 million in the same quarter of fiscal 2023 while the average yield was 8.84 percent, up 175 basis points from 7.09 percent.

Previous wording

Interest income from interest-earning deposits, primarily cash deposited at the FRB of San Francisco, was $435,000 in the second quarter of fiscal 2024, up 80 percent from $241,000 in the same quarter of fiscal 2023. The increase was due to a higher average yield and a higher average balance. The average yield earned on interest-earning deposits in the second quarter of fiscal 2024 was 5.41 percent, up 152 basis points from 3.89 percent in the same quarter last year, due primarily to an increase in the interest rate paid on excess reserves. The average balance of interest-earning deposits increased by $7.3 million, or 30 percent, to $31.5 million in the second quarter of fiscal 2024 from $24.2 million in the same quarter last year primarily due to the Bank increasing its liquidity position.

Current wording

Interest income from interest-earning deposits, primarily cash deposited at the FRB of San Francisco, was $397,000 in the third quarter of fiscal 2024, up 39 percent from $286,000 in the same quarter of fiscal 2023. The increase was due to a higher average yield and a higher average balance. The average yield earned on interest-earning deposits in the third quarter of fiscal 2024 was 5.40 percent, up 75 basis points from 4.65 percent in the same quarter last year, due primarily to an increase in the interest rate paid on excess reserves. The average balance of interest-earning deposits increased $4.5 million, or 18 percent, to $29.1 million in the third quarter of fiscal 2024 from $24.6 million in the same quarter last year primarily due to the Bank increasing its liquidity position.

Previous wording

For the Six Months Ended December 31, 2023 and 2022. Total interest income increased $5.9 million, or 28 percent, to $27.0 million for the first six months of fiscal 2024 from $21.1 million in the same period of fiscal 2023. The increase was due primarily to an increase in interest income from loans receivable and, to a lesser extent, interest income on interest earning deposits.

Current wording

For the Nine Months Ended March 31, 2024 and 2023. Total interest income increased $7.7 million, or 23 percent, to $40.8 million for the first nine months of fiscal 2024 from $33.1 million in the same period of fiscal 2023. The increase was due primarily to an increase in interest income from loans receivable and, to a lesser extent, interest income on interest-earning deposits.

Previous wording

Interest income from loans receivable increased $5.4 million, or 28 percent, to $24.7 million in the first six months of fiscal 2024 from $19.3 million for the same period of fiscal 2023. The increase was due to a higher average yield and, to a lesser extent, a higher average balance. The average yield on loans receivable increased 70 basis points to 4.60 percent during the first six months of fiscal 2024 from 3.90 percent in the same period last year. The increase in the average yield on loans receivable was primarily attributable to loans repricing upward, new loan originations with a higher average yield and a decrease in net deferred loan cost amortization to $409,000 in the first six months of fiscal 2024 from $499,000 in

Current wording

Interest income from loans receivable increased $7.0 million, or 23 percent, to $37.4 million in the first nine months of fiscal 2024 from $30.4 million for the same period of fiscal 2023. The increase was due to a higher average yield and, to a lesser extent, a higher average balance. The average yield on loans receivable increased 64 basis points to 4.64 percent during the first nine months of fiscal 2024 from 4.00 percent in the same period last year. The increase in the average yield on loans receivable was primarily attributable to loans repricing upward, new loan originations with a higher average yield and a decrease in net deferred loan cost amortization to $664,000 in the first nine months of fiscal 2024 from $726,000 in the same period of fiscal 2023. Adjustable-rate loans of approximately $302.2 million repriced upward in the first nine months of fiscal 2024 by approximately 104 basis points from an average yield of 6.35 percent to 7.39 percent. The average balance of loans receivable increased by $60.8 million, or six percent, to $1.07 billion for the first nine months of fiscal 2024 from $1.01 billion in the same period of fiscal 2023. Total loans originated for investment in the first nine months of fiscal 2024 were $56.9 million, down 73 percent from $212.8 million in the same period last year. Loan principal payments received in the first nine months of fiscal 2024 were $69.3 million, down 10 percent from $77.2 million in the same period last year.

Previous wording

Interest income from investment securities decreased $36,000, or three percent, to $1.0 million in the first six months of fiscal 2024 from $1.1 million for the same period of fiscal 2023. This decrease was attributable to a lower average balance, partly offset by a higher average yield. The average balance of investment securities decreased by $29.4 million, or 16 percent, to $150.4 million in the first six months of fiscal 2024 from $179.8 million in the same period of fiscal 2023. The decrease in the average balance of investment securities was primarily the result of scheduled and accelerated principal payments on mortgage-backed securities. The average yield on investment securities increased by 18 basis points to 1.39 percent in the first six months of fiscal 2024 from 1.21 percent in the same period of fiscal 2023. The increase in the average yield was primarily attributable to a lower premium amortization ($292,000 compared to $441,000) attributable to a lower total principal repayment ($12.6 million vs. $16.9 million) and, to a lesser extent, the upward repricing of adjustable rate mortgage-backed securities.

Current wording

Interest income from investment securities decreased $67,000, or four percent, to $1.6 million in the first nine months of fiscal 2024 as compared to the same period of fiscal 2023. This decrease was attributable to a lower average balance, partly offset by a higher average yield. The average balance of investment securities decreased by $28.4 million, or 16 percent, to $147.4 million in the first nine months of fiscal 2024 from $175.8 million in the same period of fiscal 2023. The decrease in the average balance of investment securities was primarily the result of scheduled and accelerated principal payments on mortgage-backed securities. The average yield on investment securities increased by 18 basis points to 1.42 percent in the first nine months of fiscal 2024 from 1.24 percent in the same period of fiscal 2023. The increase in the average yield was primarily attributable to a lower premium amortization ($416,000 compared to $622,000) attributable to lower total principal repayments ($18.2 million vs. $23.8 million) and, to a lesser extent, the upward repricing of adjustable rate mortgage-backed securities.

Previous wording

The FHLB – San Francisco cash dividends received in the first six months of fiscal 2024 were $376,000, up 40 percent from $268,000 in the same period of fiscal 2023. The average balance of FHLB – San Francisco stock in the first six months of fiscal 2024 was $9.5 million, up 16 percent from $8.2 million in the same period of fiscal 2023, and the average yield was 7.91 percent, up 140 basis points from 6.51 percent.

Current wording

The FHLB – San Francisco cash dividends received in the first nine months of fiscal 2024 were $586,000, up 42 percent from $414,000 in the same period of fiscal 2023. The average balance of FHLB – San Francisco stock in the first nine months of fiscal 2024 was $9.5 million, up 16 percent from $8.2 million in the same period of fiscal 2023, and the average yield was 8.22 percent, up 152 basis points from 6.70 percent.

Previous wording

Interest income from interest-earning deposits, primarily cash deposited at the FRB of San Francisco, was $898,000 in the first six months of fiscal 2024, up 136 percent from $380,000 in the same period of fiscal 2023. The increase was due to a higher average yield and, to a lesser extent, a higher average balance. The average yield earned on interest-earning deposits increased by 225 basis points to 5.36 percent in the first six months of fiscal 2024 from 3.11 percent in the comparable period last year, due primarily to an increase in the interest rate paid on excess reserves. The average balance of the interest-earning deposits in the first six months of fiscal 2024 was $32.8 million, an increase of $8.9 million or 37 percent, from $23.9 million in the same period of fiscal 2023.

Current wording

Interest income from interest-earning deposits, primarily cash deposited at the FRB of San Francisco, was $1.3 million in the first nine months of fiscal 2024, up 94 percent from $666,000 in the same period of fiscal 2023. The increase was due to a higher average yield and, to a lesser extent, a higher average balance. The average yield earned on interest-earning deposits increased by 176 basis points to 5.38 percent in the first nine months of fiscal 2024 from 3.62 percent in the comparable period last year, due primarily to an increase in the interest rate paid on excess reserves. The average balance of the interest-earning deposits in the first nine months of fiscal 2024 was $31.5 million, an increase of $7.3 million or 30 percent, from $24.2 million in the same period of fiscal 2023.

Previous wording

**For the Quarters Ended December 31, 2023 and 2022.**Total interest expense increased $3.1 million or 172 percent to $4.9 million in the second quarter of fiscal 2024 from $1.8 million in the same quarter last year. The increase was attributable to higher interest expense on borrowings and time deposits, particularly brokered certificates of deposit.

Current wording

**For the Quarters Ended March 31, 2024 and 2023.**Total interest expense increased $2.6 million or 100 percent to $5.2 million in the third quarter of fiscal 2024 from $2.6 million in the same quarter last year. The increase was attributable to higher interest expense on borrowings and time deposits, particularly brokered certificates of deposit.

Previous wording

Interest expense on deposits for the second quarter of fiscal 2024 was $2.3 million, a 379 percent increase from $475,000 for the same period last year. The increase in interest expense on deposits was attributable to higher average cost and, to a lesser extent, higher average balance of time deposits. The average cost of deposits was 0.99 percent for the second quarter of fiscal 2024, up 79 basis points from 0.20 percent in the same quarter last year, attributable primarily to the average cost of time deposits (including brokered certificates of deposit) which increased 252 basis points to 3.55 percent for the second quarter of fiscal 2024 from 1.03 percent in the same quarter of fiscal 2023. The average balance of deposits decreased five percent to $914.6 million in the second quarter of fiscal 2024 from $962.4 million in the same quarter last year due to decreases in transaction accounts which was partly offset by an increase in time deposits. The average balance of transaction accounts was $677.1 million in the second quarter of fiscal 2024, down 17 percent from $820.0 million in the same quarter last year; while the average balance of time deposits (including brokered certificates of deposits) increased 67 percent to $237.6 million in the second quarter of fiscal 2024 from $142.4 million in the same quarter last year.

Current wording

Interest expense on deposits for the third quarter of fiscal 2024 was $2.7 million, a 204 percent increase from $879,000 for the same quarter last year. The increase in interest expense on deposits was attributable to a higher average cost and, to a lesser extent, a higher average balance of time deposits. The average cost of deposits was 1.18 percent for the third quarter of fiscal 2024, up 81 basis points from 0.37 percent in the same quarter last year, primarily attributable to the average cost of time deposits (including brokered certificates of deposit) which increased 199 basis points to 3.86 percent for the third quarter of fiscal 2024 from 1.87 percent in the same quarter of fiscal 2023. The average balance of deposits

Previous wording

Interest expense on borrowings, consisting of FHLB – San Francisco advances, for the second quarter of fiscal 2024 increased $1.3 million, or 100 percent, to $2.6 million from $1.3 million for the same period last year. The increase was primarily the result of a higher average balance and, to a lesser extent, a higher average cost of borrowings. The average balance of borrowings increased $76.8 million or 50 percent to $230.5 million in the second quarter of fiscal 2024 from

Current wording

Interest expense on borrowings, consisting of FHLB – San Francisco advances, for the third quarter of fiscal 2024 increased $845,000, or 49 percent, to $2.6 million from $1.7 million for the same quarter last year. The increase was primarily the result of a higher average balance and, to a lesser extent, a higher average cost of borrowings. The average balance of borrowings increased $47.1 million or 27 percent to $223.6 million in the third quarter of fiscal 2024 from $176.5 million in the same quarter last year and the average cost of borrowings increased 66 basis points to 4.63 percent in the third quarter of fiscal 2024 from 3.97 percent in the same quarter last year.

Previous wording

For the Six Months Ended December 31, 2023 and 2022. Total interest expense increased $6.4 million, or 237 percent to $9.1 million in the first six months of fiscal 2024 from $2.7 million in the same period last year. The increase was attributable to higher interest expense on borrowings and time deposits, particularly brokered certificates of deposit.

Current wording

For the Nine Months Ended March 31, 2024 and 2023. Total interest expense increased $9.0 million, or 170 percent to $14.3 million in the first nine months of fiscal 2024 from $5.3 million in the same period last year. The increase was attributable to higher interest expense on borrowings and time deposits, particularly brokered certificates of deposit.

Previous wording

Interest expense on deposits for the first six months of fiscal 2024 was $4.2 million, a 425 percent increase from $792,000 for the same period last year. The increase in interest expense on deposits was primarily attributable to higher average cost of time deposits, and to a lesser extent, higher average balance of time deposits. The average cost of deposits was 0.89 percent, up 73 basis points from 0.16 percent in the same period last year, attributable primarily to time deposits (including brokered certificates of deposit) which increased 250 basis points to 3.36 percent for the first six months of fiscal 2024 from 0.86 percent for same period in fiscal 2023. The average balance of deposits decreased $34.9 million or four percent to $927.4 million in the first six months of fiscal 2024 from $962.3 million in the same period last year due primarily to a decrease of $131.2 million in the average balance of transaction accounts, partly offset by an increase of $96.3 million in the average balance of time deposits.

Current wording

Interest expense on deposits for the first nine months of fiscal 2024 was $6.8 million, a 300 percent increase from $1.7 million for the same period last year. The increase in interest expense on deposits was primarily attributable to a higher average cost of time deposits, and to a lesser extent, a higher average balance of time deposits. The average cost of deposits was 0.99 percent, up 76 basis points from 0.23 percent in the same period last year, primarily attributable to time deposits (including brokered certificates of deposit) which increased 230 basis points to 3.54 percent for the first nine months of fiscal 2024 from 1.24 percent for the same period in fiscal 2023. The average balance of deposits decreased $40.3 million or four percent to $921.9 million in the first nine months of fiscal 2024 from $962.2 million in the same period last year due primarily to a decrease of $134.6 million in the average balance of transaction accounts, partly offset by an increase of $94.3 million in the average balance of time deposits.

Previous wording

Interest expense on borrowings, consisting primarily of FHLB – San Francisco advances, for the first six months of fiscal 2024 increased $3.0 million, or 158 percent, to $4.9 million from $1.9 million in the same period last year. The increase in interest expense on borrowings was primarily the result of a higher average balance and, to a lesser extent, a higher average cost. The average balance of borrowings increased by $93.6 million or 73 percent to $221.5 million in the first six months of fiscal 2024 from $127.9 million in the same period last year, and the average cost of borrowings increased 143 basis points to 4.42 percent in the first six months of fiscal 2024 from 2.99 percent in the same period last year

Current wording

Interest expense on borrowings, consisting primarily of FHLB – San Francisco advances, for the first nine months of fiscal 2024 increased $3.8 million, or 103 percent, to $7.5 million from $3.7 million in the same period last year. The increase in interest expense on borrowings was primarily the result of a higher average balance and, to a lesser extent, a higher average cost. The average balance of borrowings increased $78.3 million or 54 percent to $222.2 million in the first nine months of fiscal 2024 from $143.9 million in the same period last year, and the average cost of borrowings increased 112 basis points to 4.50 percent in the first nine months of fiscal 2024 from 3.38 percent in the same period last year