Gouverneur Bancorp, Inc./MD/
For the period ended Sep 30, 2025. Filed Dec 19, 2025.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Dec 19, 2025
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What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-09-30; filed 2024-12-20.
0001558370-24-016433
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-09-30; filed 2025-12-19.
0001104659-25-123106
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 133 previous paragraphs and 131 current paragraphs.
85 unchanged; 35 reworded; 9 added; 9 removed; 4 previous and 2 current paragraphs rearranged.
Tables are not compared: 33 previous and 31 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (9)
Current report
Specific Allowances for Individually Analyzed Loans
Current report
Total assets increased by $1.2 million, or 0.64%, to $198.5 million at September 30, 2025 from $197.3 million at September 30, 2024. The increase in assets was primarily due to an increase in loans receivable, net of allowance for credit losses, of $7.2 million, partially offset by a decrease in securities available for sale of $4.4 million and a decrease in cash and cash equivalents of $1.7 million. During 2025, there was a $59,000 provision for credit loss and $28,000 charged-off against non-performing loans.
Current report
and a $32,000 decrease in accrued interest on investments. This decrease was partially offset by a $140,000 increase in net deferred tax assets and a $59,000 increase in accrued interest on loans.
Current report
Total deposits decreased by $5.1 million, or 3.20%, to $154.8 million at September 30, 2025 from $159.9 million at September 30, 2023. The decrease in deposits can primarily be attributed to a $4.9 million decrease in non-maturing deposits, due to seasonal fluctuations and activity from a small number of larger deposit relationships.
Current report
There were $7.0 million in Federal Home Loan Bank advances at September 30, 2025 and no advances at September 30, 2024. The increase in advances was primarily due to an increase in loans receivable, net of allowance for credit losses, and a net outflow of customer deposits, partially offset by security principal paydowns, maturities and sale proceeds.
Current report
Shareholders’ equity decreased by $657,000, or 2.01%, to $32.1 million at September 30, 2025 from $32.8 million at September 30, 2024. The decrease in shareholders’ equity was primarily a result of a $0.5 million decrease to the market value of the securities portfolio included in accumulated other comprehensive loss, and the repurchase of common stock to authorized but unissued by the Company, partially offset by net income. The Company declared cumulative dividends of $0.16 per share totaling $174,000 during the year ended September 30, 2025.
Current report
Net interest income totaled $7.1 million for the years ended September 30, 2025 and 2024. Interest income on loans increased $315,000 while interest income on securities decreased $222,000 from the prior year. Interest expense on deposits increased $274,000 and interest income on the swap agreements hedged against borrowings decreased $132,000, partially offset by a $306,000 decrease in interest expense on FHLB advances.
Current report
The decrease in 2025 total non-interest expense included a $119,000 decrease in salaries and employee benefits for the year ended September 30, 2025, as compared to the year ended September 30, 2024, primarily due to staff retirements over the prior year. Other non-interest expense increased $227,000 for the year ended September 30, 2025, as compared to the year ended September 30, 2024, primarily due to operational expenses related to the Company’s operations as a public company.
Current report
Specific Allowances for Individually Analyzed Loans
Removed paragraphs (9)
Previous report
We also use derivative instruments as a risk management tool and have entered into several interest rate swap agreements whereby we pay a fixed rate and receive a variable rate on a notional amount. We enter into these arrangements to hedge the cost of certain funding sources and to increase the interest rate sensitivity of certain assets. Financial derivatives are recorded at fair value as other assets or liabilities. The accounting for changes in the fair value of a derivative depends on whether it has been designated and qualifies as a part of a hedging relationship. For a fair value hedge, changes in the fair value of the derivative instrument and changes in the fair value of the hedged asset or liability are currently recognized in current year earnings, and gains are the result of the swaps market value fluctuations with long-term bond rates and projected short-term rates.
Previous report
Specific Allowances for Identified Problem Loans
Previous report
Total assets decreased by $8.6 million, or 4.19%, to $197.3 million at September 30, 2024 from $205.9 million at September 30, 2023. The decrease in assets was primarily due to a decrease in cash and cash equivalents of $4.0 million, a decrease in acquired loans of $4.0 million, and a decrease in securities of $1.3 million, partially offset by an increase in originated loans of $3.3 million. Total loans, net of the allowance for credit losses, decreased by $1.2 million, or 0.93%, to $124.2 million at September 30, 2024 from $125.4 million at September 30, 2023. The decrease in loans, net of the allowance for credit losses, was primarily due to a decrease in net loans acquired from Citizens Bank of Cape Vincent of $4.0 million and the transition adjustment of the adoption of CECL, which resulted in an increase in the allowance for credit losses on loans of $436,000, partially offset by an increase in newly originated loans of $3.3 million. During 2024, there was a $70,000 provision for credit loss and $86,000 charged-off against non-performing loans.
Previous report
Total deposits increased by $1.1 million, or 0.71%, to $159.9 million at September 30, 2024 from $158.8 million at September 30, 2023. The increase in deposits can primarily be attributed to a $11.7 million increase in time deposits, partially offset by a $10.6 million decrease in non-maturing deposits, due to seasonal fluctuations with municipal deposits. The increase in time deposits can primarily be attributed to an increase in offering rates as market and competitor rates increased during the fiscal year.
Previous report
There were no Federal Home Loan Bank advances at September 30, 2024 and $14.0 million in advances at September 30, 2023. The decrease in advances was primarily due to principal maturities and increase in the Bank’s internal accounts from the net stock offering proceeds in October 2023 following the completion of the second-step conversion.
Previous report
Shareholders’ equity increased by $7.7 million, or 30.50%, to $32.8 million at September 30, 2024 from $25.1 million at September 30, 2023. The increase in shareholders’ equity was primarily a result of the completion of the second-step conversion on October 31, 2023, at which time the Company sold, for gross proceeds of $7.2 million, a total of 723,068 shares of common stock at $10.00 per share, including 57,845 shares sold to the Bank’s employee stock ownership plan. There was also a $2.5 million increase to the market value adjustment on the securities portfolio included in the accumulated other comprehensive income component.
Previous report
Net interest income totaled $7.1 million for the year ended September 30, 2024, as compared to $7.6 million for the year ended September 30, 2023. The decrease in net interest income of $445,000, or 5.87%, was primarily due to an increase in deposit interest expense of $888,000, partially offset by an increase in total interest income of $403,000 and a decrease in borrowing interest expense of $33,000.
Previous report
The increase in 2024 total non-interest expense included a $142,000 increase in professional fees due to professional services resulting from the Bank’s second step conversion, which was completed during the first quarter of fiscal year 2024, and expenses related to the Company’s operations as a public company. Directors’ fees increased $82,000 over the same period due to partial directors’ fees being paid at the mutual holding company level prior to the second step conversion and now through the new stock holding company. Other non-interest expense decreased $171,000 for the year ended September 30, 2024, as compared to the year ended September 30, 2023, due to a reduction in one-time expenses related to the acquisition of CBCV and the second step conversion.
Previous report
Specific Allowances for Identified Problem Loans
Reworded paragraphs (35)
Previous wording
pay on our interest-bearing liabilities, consisting of savings and club accounts, NOW and money market accounts and time certificates. Our results of operations also are affected by our provisions for credit losses, non-interest income and non-interest expense. Non-interest income currently consists primarily of service charges, unrealized gains (losses) on swap agreements, earnings on bank owned life insurance and loan servicing fees. Non-interest expense currently consists primarily of salaries and employee benefits, directors’ fees, occupancy and data processing expense and professional fees. Our results of operations also may be affected significantly by general and local economic and competitive conditions, changes in market interest rates, governmental policies and actions of regulatory authorities.
Current wording
Our results of operations depend primarily on our net interest income. Net interest income is the difference between the interest income we earn on our interest-earning assets, consisting primarily of loans and securities, and the interest we pay on our interest-bearing liabilities, consisting of savings and club accounts, NOW and money market accounts and time certificates. Our results of operations also are affected by our provisions for credit losses, non-interest income and non-interest expense. Non-interest income currently consists primarily of service charges, unrealized gains (losses) on swap agreements, earnings on bank owned life insurance and loan servicing fees. Non-interest expense currently consists primarily of salaries and employee benefits, directors’ fees, occupancy and data processing expense and professional fees. Our results of operations also may be affected significantly by general and local economic and competitive conditions, changes in market interest rates, governmental policies and actions of regulatory authorities.
Previous wording
●Continuing to emphasize residential mortgage lending. We have been and will continue to be primarily a one- to four-family residential mortgage lender for borrowers in our market area. As of September 30, 2024, $103.5 million, or 82.35%, of our total loan portfolio consisted of one- to four-family mortgage loans. Our primary market area, which is located in the northernmost region of New York state, borders the St. Lawrence River and includes private and public lands that are attractive vacation destinations. As a result, our one to four-family residential mortgage loan portfolio also includes loans made to purchase second vacation homes and cottages. We have primarily originated residential mortgage loans for our own portfolio, rather than for sale, and we generally service the loans we originate. We provide customers with alternatives for their borrowing needs by offering both fixed- and adjustable-rate products with various terms to maturity and pricing alternatives. Through our marketing efforts, our reputation, pricing and strong relationships with real estate agents, we attract mortgage loan business from walk-in customers, customers that apply online and existing customers. We believe that there are opportunities to increase our residential mortgage lending in our market area, and we intend to continue our emphasis on originating one- to four-family loans that meet our underwriting standards.
Current wording
●Continuing to emphasize residential mortgage lending. We have been and will continue to be primarily a one- to four-family residential mortgage lender for borrowers in our market area. As of September 30, 2025, $109.7 million, or 82.58%, of our total loan portfolio consisted of one- to four-family mortgage loans. Our primary market area, which is located in the northernmost region of New York state, borders the St. Lawrence River and includes private and public lands that are attractive vacation destinations. As a result, our one to four-family residential mortgage loan portfolio also includes loans made to purchase second vacation homes and cottages. We have primarily originated residential mortgage loans for our own portfolio, rather than for sale, and we generally service the loans we originate. We provide customers with alternatives for their borrowing needs by offering both fixed- and adjustable-rate products with various terms to maturity and pricing alternatives. Through our marketing efforts, our reputation, pricing and strong relationships with real estate agents, we attract mortgage loan business from walk-in customers, customers that apply online and existing
Previous wording
chartered savings and loan association, such as the Bank, is not authorized to directly receive New York state or municipal deposits. As of September 30, 2024, GS&L Municipal Bank held $21.4 million in municipal deposits, consisting of public funds on deposit from local government entities domiciled in the State of New York. We have devoted significant time and resources to forming GS&L Municipal Bank and establishing the infrastructure necessary for GS&L Municipal Bank to operate effectively, and we believe there are opportunities to continue to increase municipal deposits as a cost-effective source of funds to help generate additional income in the future. Accordingly, we intend to continue to solicit municipal deposits through GS&L Municipal Bank by leveraging our management team’s existing relationships with local municipalities and governmental entities located in our primary market area.
Current wording
●Increasing municipal deposits as a cost-effective source of funds to help generate future spread income. To enhance our deposit taking activities, the Bank operates a limited-purpose wholly owned subsidiary, GS&L Municipal Bank, that was formed in September 2022 as a New York-chartered limited purpose commercial bank. We maintain GS&L Municipal Bank as a limited purpose commercial bank subsidiary because, under New York municipal laws, a New York-chartered savings and loan association, such as the Bank, is not authorized to directly receive New York state or municipal deposits. As of September 30, 2025, GS&L Municipal Bank held $20.0 million in municipal deposits, consisting of public funds on deposit from local government entities domiciled in the State of New York. We have devoted significant time and resources to forming GS&L Municipal Bank and establishing the infrastructure necessary for GS&L Municipal Bank to operate effectively, and we believe there are opportunities to continue to increase municipal deposits as a cost-effective source of funds to help generate additional income in the future. Accordingly, we intend to continue to solicit municipal deposits through GS&L Municipal Bank by leveraging our management team’s existing relationships with local municipalities and governmental entities located in our primary market area.
Previous wording
●Grow organically and through opportunistic expansion. Following our acquisition of Citizens Bank of Cape Vincent in September 2022, our primary intention is currently to grow our balance sheet organically and use our capital to increase our lending and investment capacity. In addition to organic growth, we may also consider expansion opportunities in our market area or in contiguous markets that we believe would enhance both our franchise value and stockholder returns. These opportunities primarily include establishing loan production offices, establishing new, or de novo, branch offices (including micro branch offices) and/or acquiring branch offices. Consistent with this strategy, in January 2025, we expect to open a new loan production office in Potsdam, New York.
Current wording
●Grow organically and through opportunistic expansion. Following our acquisition of Citizens Bank of Cape Vincent in September 2022, our primary intention is currently to grow our balance sheet organically and use our capital to increase our lending and investment capacity. In addition to organic growth, we may also consider expansion opportunities in our market area or in contiguous markets that we believe would enhance both our franchise value and stockholder returns. These opportunities primarily include establishing loan production offices, establishing new, or de novo, branch offices (including micro branch offices) and/or acquiring branch offices. Consistent with this strategy, in April 2025, we opened a new loan production office located in Potsdam, New York.
Previous wording
We consider the allowance for credit losses to be a critical accounting policy. Note 2 to the Company’s Consolidated Financial Statements for the fiscal year ended September 30, 2024 discusses significant accounting policies, including the allowance for credit losses and the adoption of ASC 326, which changes the methodology under which management calculates its reserve for loans and investment securities, now referred to as the allowance for credit losses. Please refer to Note 2 to the Company’s Consolidated Financial Statements for detail regarding the Company’s adoption of ASU 206-13:Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and the allowance for credit losses. Although we believe that we use the best information available to establish the allowance for credit losses, future adjustments to the allowance may be necessary if economic conditions differ substantially from the assumptions used in making the evaluation.
Current wording
We consider the allowance for credit losses to be a critical accounting policy. Note 2 to the Company’s Consolidated Financial Statements for the fiscal year ended September 30, 2025 discusses significant accounting policies, including the allowance for credit losses and the adoption of ASC 326, which changes the methodology under which management calculates its reserve for loans and investment securities, now referred to as the allowance for credit losses. Please refer to Note 2 to the Company’s Consolidated Financial Statements for detail regarding the Company’s adoption of ASU 2016-13:Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments on October 1, 2023 and the allowance for credit losses. Although we believe that we use the best information available to establish the allowance for credit losses, future adjustments to the allowance may be necessary if economic conditions differ substantially from the assumptions used in making the evaluation.
Previous wording
Our financial results are affected by the changes in and the level of the allowance for credit losses. This process involves our analysis of complex internal and external variables, and it requires that we exercise judgement to estimate an appropriate allowance for credit losses. As a result of the uncertainty associated with this subjectivity, we cannot assure the precision of the amount reserved, should we experience sizeable loan losses in any particular period. For example, changes in the financial condition of individual borrowers, economic conditions, or the condition of various markets in which collateral may be sold could require us to significantly decrease or increase the level of the allowance for credit losses. Such an adjustment could materially affect net income as a result of the change in provision for credit losses. We also have approximately $901,000 as of September 30, 2024 in non-performing assets consisting of non-performing loans. We continue to assess the collectability of these loans and update our appraisals on these loans as appropriate.
Current wording
Our financial results are affected by the changes in and the level of the allowance for credit losses. This process involves our analysis of complex internal and external variables, and it requires that we exercise judgement to estimate an appropriate allowance for credit losses. As a result of the uncertainty associated with this subjectivity, we cannot assure the precision of the amount reserved, should we experience sizeable loan losses in any particular period. For example, changes in the financial condition of individual borrowers, economic conditions, or the condition of various markets in which collateral may be sold could require us to significantly decrease or increase the level of the allowance for credit losses. Such an adjustment could materially affect net income as a result of the change in provision for credit losses. We also have approximately $800,000 as of September 30, 2025 in non-performing assets consisting of non-performing loans. We continue to assess the collectability of these loans and update our appraisals on these loans as appropriate.
Previous wording
Management monitors differences between estimated and actual credit losses. This monitoring process includes periodic assessments by senior management of loan portfolios and the models used to estimate the expected credit losses in those portfolios. Additions to the allowance for credit losses are made by changes to the provision for loan losses. Credit exposures deemed to be uncollectible are charged against the allowance for loan losses. Recoveries of previously charged off amounts are credited to the allowance for credit losses.
Current wording
Management monitors differences between estimated and actual credit losses. This monitoring process includes periodic assessments by senior management of loan portfolios and the models used to estimate the expected credit losses in those portfolios. Additions to the allowance for credit losses are made by changes to the provision for credit losses. Credit
Previous wording
Goodwill represents the excess cost of the acquisition of Citizens Bank of Cape Vincent over the fair value of acquired tangible assets and liabilities and identifiable intangible assets. When calculating goodwill in accordance with FASB ASC 805-30-55-3, we evaluate whether the fair value of equity of the acquired company is a more reliable measure than the fair value of the equity interests transferred. We consider the assumptions required to calculate the fair value of equity of an acquired company using discounted cash flow models (income approach) and/or change of control premium models (market approach) which are generally based on a higher level of market participant inputs and therefore a lower level of subjectivity when compared to the assumptions required to calculate the fair value of equity interests transferred under a fair value pricing model. As a result, we consider the calculation of the fair value of the equity of an acquired company to be more reliable than the calculation of the fair value of the equity interests transferred. Goodwill is assessed at least annually for impairment and any such impairment will be recognized in the period identified. Goodwill is not amortized but is evaluated annually for impairment.
Current wording
Goodwill represents the excess cost of the 2022 acquisition of Citizens Bank of Cape Vincent over the fair value of acquired tangible assets and liabilities and identifiable intangible assets. When calculating goodwill in accordance with FASB ASC 805-30-55-3, we evaluated whether the fair value of equity of the acquired company is a more reliable measure than the fair value of the equity interests transferred. We considered the assumptions required to calculate the fair value of equity of an acquired company using discounted cash flow models (income approach) and/or change of control premium models (market approach) which are generally based on a higher level of market participant inputs and therefore a lower level of subjectivity when compared to the assumptions required to calculate the fair value of equity interests transferred under a fair value pricing model. As a result, we consider the calculation of the fair value of the equity of an acquired company to be more reliable than the calculation of the fair value of the equity interests transferred. Goodwill is assessed at least annually for impairment and any such impairment will be recognized in the period identified. Goodwill is not amortized but is evaluated annually for impairment.
Previous wording
Cash and cash equivalents decreased by $4.0 million, or 38.79%, to $6.4 million at September 30, 2024 from $10.4 million at September 30, 2023. The decrease in cash can primarily be attributed to a decrease in Federal Home Loan Bank advances, partially offset by a net inflow of customer deposits and proceeds from securities maturing.
Current wording
Cash and cash equivalents decreased by $1.7 million, or 26.86%, to $4.7 million at September 30, 2025 from $6.4 million at September 30, 2024. The decrease in cash can primarily be attributed to an increase in loans receivable, net of allowance for credit losses, and a net outflow of customer deposits, partially offset by an increase in Federal Home Loan Bank advances and proceeds from securities maturing and from sales.
Previous wording
Securities available for sale decreased by $1.3 million, or 2.74%, to $45.3 million at September 30, 2024 from $46.6 million at September 30, 2023. The decrease was primarily due to principal paydowns and maturities, partially offset by an increase to the market value of the portfolio.
Current wording
Securities available for sale decreased by $4.4 million, or 9.74%, to $40.9 million at September 30, 2025 from $45.3 million at September 30, 2024. The decrease was primarily due to principal paydowns, maturities and sale proceeds along with a decrease in the market value as market rates fluctuate.
Previous wording
There was no foreclosed real estate at September 30, 2024, down from $101,000 at September 30, 2023 due to the sale of two other real estate owned (“REO”) properties. Due to the low number of REO properties, year over year balances can fluctuate significantly.
Current wording
Foreclosed real estate increased to $105,000 at September 30, 2025, up from none at September 30, 2024, primarily due to the transfer of two properties into other real estate owned (“REO”), one of which was sold for a gain during the fiscal year. Due to the low number of REO properties, year over year balances can fluctuate significantly.
Previous wording
Accrued interest receivable and other assets decreased by $497,000, or 9.95%, to $4.5 million from $5.0 million at September 30, 2023 primarily due to a decrease in the net deferred tax balance of $330,000 and a $240,000 decrease in the market value on swaps. This decrease was partially offset by a $175,000 increase in the loans in process account at fiscal year-end.
Current wording
Accrued interest receivable and other assets decreased by $22,000, or 0.49%, remaining at $4.5 million at both September 30, 2025 and 2024. The decrease is primarily due to a $333,000 decrease in the loans in process account at fiscal year-end
Previous wording
Loan Portfolio Composition.* * The following table sets forth the composition of our loan portfolio by type of loan at the dates indicated. In addition to the loans included in the table below, at September 30, 2024, we had $1.1 million of loans in process.
Current wording
Loan Portfolio Composition.* * The following table sets forth the composition of our loan portfolio by type of loan at the dates indicated. In addition to the loans included in the table below, at September 30, 2025, we had $4.5 million of loans in process.
Previous wording
Portfolio Maturities and Yields. The composition and maturities of the available-for-sale investment securities portfolio at September 30, 2024 are summarized in the table below. We did not have any held-to-maturity investment securities as of September 30, 2024. Maturities are based on the final contractual payment dates, and do not reflect the
Current wording
Portfolio Maturities and Yields. The composition and maturities of the available-for-sale investment securities portfolio at September 30, 2025 are summarized in the table below. We did not have any held-to-maturity investment securities as of September 30, 2025. Maturities are based on the final contractual payment dates, and do not reflect the effect of scheduled principal repayments, prepayments, or early redemptions that may occur. Yields on tax-exempt obligations have not been computed on a tax-equivalent basis, as the effect would not be material.
Previous wording
Uninsured deposits, which are the portion of deposit accounts that exceed the Federal Deposit Insurance Corporation insurance limits, currently set at $250,000, were approximately $37.2 million at September 30, 2024 and $42.3 million at September 30, 2023. GS&L Municipal Bank accounted for approximately $19.3 million and $17.5 million of the uninsured deposits at September 30, 2024 and September 30, 2023, respectively. At September 30, 2024, we had $68.3 million in available liquidity with the Federal Home Loan Bank of New York and other borrowing sources and $6.4 million in cash and cash equivalents, which was sufficient to cover 100% of our total $17.9 million uninsured and uncollateralized deposits. Municipal deposits held by GS&L Municipal Bank are fully collateralized by available for sale government and collateralized mortgage obligation securities.
Current wording
Uninsured deposits, which are the portion of deposit accounts that exceed the Federal Deposit Insurance Corporation insurance limits, currently set at $250,000, were approximately $31.6 million at September 30, 2025 and $37.2 million at September 30, 2025. GS&L Municipal Bank accounted for approximately $18.0 million and $19.3 million of the uninsured deposits at September 30, 2025 and September 30, 2024, respectively. At September 30, 2025, we had $63.9 million in available liquidity with the Federal Home Loan Bank of New York and other borrowing sources and $4.7 million in cash and cash equivalents, which was sufficient to cover 100% of our total $13.6 million uninsured and uncollateralized deposits. Municipal deposits held by GS&L Municipal Bank are fully collateralized by available for sale government and collateralized mortgage obligation securities.
Previous wording
Net income for the year ended September 30, 2024 was $539,000 compared to net income of $317,000 for the year ended September 30, 2023. Net income for the year ended September 30, 2024 was higher than the year ended September 30, 2023 primarily due to a $562,000 increase in the unrealized gain (loss) on interest rate swap agreements. The increase in net income was also impacted by a $13,000 realized gain on sale of securities and $75,000 realized gain on swaps unwound. Total interest income increased $403,000 which was offset by interest expense increasing $848,000 with market interest rates and competitor rates increasing.
Current wording
Net income for the year ended September 30, 2025 was $733,000 compared to net income of $539,000 for the year ended September 30, 2024. Net income for the year ended September 30, 2025 was higher than the year ended September 30, 2024 primarily due to a $231,000 decrease in the unrealized loss on interest rate swap agreements. The increase in net income was also impacted by a $16,000 realized gain on sale of available for sale securities and a $70,000 realized gain on sale of equity securities. Total interest income increased $101,000 which was offset by interest expense increasing $100,000 resulting from higher deposit rates from the respective prior year periods.
Previous wording
Interest income increased by $403,000, or 4.93%, due to an increase in market rates resulting in higher interest rates on loan originations and loan repricing. Interest expense increased by $848,000, or 148.77%, due to an increase in the cost of interest-bearing liabilities by 64 basis points from 0.69% to 1.33%. Net interest margin decreased by 16 basis points, or 0.16%, during the year ended September 30, 2024 to 4.03% compared to 4.19% at September 30, 2023.
Current wording
Interest income increased by $101,000, or 1.18%, due to an increase in market rates resulting in higher interest rates on loan originations and loan repricing. Interest expense increased by $100,000, or 7.05%, due to an increase in the weighted average cost of interest-bearing liabilities by 8 basis points from 0.97% to 1.05%. Net interest margin increased by 5 basis points, or 0.05%, during the year ended September 30, 2025 to 4.08% compared to 4.03% at September 30, 2024.
Previous wording
Management recorded credit loss provisions of $70,000 and $122,000 for the years ended September 30, 2024 and 2023, respectively. During 2024, we charged-off a total of $86,000 against non-performing loans. During 2023, we charged-off a total of $126,000 against non-performing loans. We recorded recoveries of $15,000 and $6,000 during the years ended September 30, 2024 and 2023, respectively.
Current wording
Management recorded credit loss provisions of $59,000 and $70,000 for the years ended September 30, 2025 and 2024, respectively. During 2025, we charged-off a total of $28,000 against non-performing loans. During 2024, we charged-off a total of $86,000 against non-performing loans. We recorded recoveries of $4,000 and $16,000 during the years ended September 30, 2025 and 2024, respectively.
Previous wording
The increase in total non-interest income was primarily due to the reduction in the unrealized loss on swap agreements resulting from fluctuations with long-term bond rates and projected short-term rates. The unrealized loss on swap agreements was $240,000 at September 30, 2024 compared to an unrealized loss of $802,000 at September 30, 2023. For the year ended September 30, 2024, the Company unwound two off-balance sheet swaps for a realized gain of $75,000 and sold four investments for a gain of $13,000. For the year ended September 30, 2023, the Company unwound four off-balance sheet swaps for a realized gain of $654,000 and sold fourteen investments for a loss of $661,000.
Current wording
The increase in total non-interest income was primarily due to the reduction in the unrealized loss on swap agreements resulting from fluctuations with long-term bond rates and projected short-term rates. The unrealized loss on swap agreements was $9,000 at September 30, 2025 compared to an unrealized loss of $240,000 at September 30, 2024. For the year ended September 30, 2025, the Company sold five investments for a gain of $16,000 and sold equity securities for a gain of $70,000. For the year ended September 30, 2024, the Company unwound two off-balance sheet swaps for a realized gain of $75,000 and sold four investments for a gain of $13,000. On November 4, 2024, the Company’s last remaining off-balance sheet swap, $3.0 million in notional value, matured. Other non-interest income increased $49,000 for the year ended September 30, 2025 compared to the prior year, primarily due to the recognition of additional income from a tax-related refund.
Previous wording
The Company recorded an income tax benefit of $63,000 and $84,000 for the years ended September 30, 2024 and 2023, respectively. The decrease in income tax benefit resulted from an increase in pre-tax book income and a change in interest income in tax-exempt securities. The Company’s effective income tax rates were (13.24%) and (36.05%) for the years ended September 30, 2024 and 2023, respectively. The income tax benefit in both 2024 and 2023 primarily reflects the Company’s tax-exempt income, including earnings from securities and Bank-Owned Life Insurance (BOLI), which reduce the overall tax liability.
Current wording
The Company recorded an income tax expense of $60,000 for the year ended September 30, 2025 and income tax benefit of $63,000 for the year ended September 30, 2024. The increase in income taxes resulted from an increase in pre-tax book income and a change in interest income in tax-exempt securities. The Company’s effective income tax rates were 7.57% and (13.24%) for the years ended September 30, 2025 and 2024, respectively. The effective income tax rates in both 2025 and 2024 primarily reflects the Company’s tax-exempt income, including earnings from securities and Bank-Owned Life Insurance (BOLI), which reduce the overall tax liability.
Previous wording
The table below sets forth average balance sheets, average yields and costs, and certain other information for the periods indicated. No tax-equivalent yield adjustments have been made, as the effects would be immaterial. All average balances are daily average balances. Non-accrual loans were included in the computation of average balances only. The yields set forth below include the effect of deferred fees, discounts, and premiums that are amortized or accreted to interest income or interest expense. Deferred loan fees totaled $437,000 for the years ended September 30, 2024 and 2023. Loan balances exclude loans held for sale.
Current wording
The table below sets forth average balance sheets, average yields and costs, and certain other information for the periods indicated. No tax-equivalent yield adjustments have been made, as the effects would be immaterial. All average balances are daily average balances. Non-accrual loans were included in the computation of average balances only. The yields set forth below include the effect of deferred fees, discounts, and premiums that are amortized or accreted to interest income or interest expense. Deferred loan fees totaled $483,000 and $437,000 for the years ended September 30, 2025 and 2024, respectively.
Previous wording
Non-Performing Assets. The table below sets forth information regarding our non-performing assets. Non-accrual loans include non-accruing troubled debt restructurings of $402,000 as of September 30, 2023. There were no non-accruing loans modified with financial difficulty as of September 30, 2024.
Current wording
Non-Performing Assets. The table below sets forth information regarding our non-performing assets. There were no non-accruing loans modified with financial difficulty as of September 30, 2025 and 2024.
Previous wording
The Bank owned no foreclosed property at September 30, 2024 as compared to two pieces of foreclosed property at September 30, 2023.
Current wording
The Bank owned one piece of foreclosed property at September 30, 2025 as compared to no foreclosed property owned at September 30, 2024.
Previous wording
Management monitors differences between estimated and actual credit losses. This monitoring process includes periodic assessments by senior management of loan portfolios and the models used to estimate the expected credit losses in those portfolios. Additions to the allowance for credit losses are made by changes to the provision for loan losses. Credit exposures deemed to be uncollectible are charged against the allowance for credit losses. Recoveries of previously charged off amounts are credited to the allowance for credit losses.
Current wording
Management monitors differences between estimated and actual credit losses. This monitoring process includes periodic assessments by senior management of loan portfolios and the models used to estimate the expected credit losses in those portfolios. Additions to the allowance for credit losses are made by changes to the provision for credit losses. Credit exposures deemed to be uncollectible are charged against the allowance for credit losses. Recoveries of previously charged off amounts are credited to the allowance for credit losses.
Previous wording
Loans classified as substandard or worse are considered for impairment testing. A substandard loan shows signs of continuing negative financial trends and unprofitability, and therefore is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. The borrower on such loans typically exhibits one or more of the following characteristics: financial ratios and profitability margins are well below industry average; a negative cash flow position exists; debt service capacity is insufficient to the service debt and an improvement in the cash flow position is unlikely within the next twelve months; secondary and tertiary means of debt repayment are weak. Loans classified as substandard are characterized by the probability that we will not collect amounts due according to the contractual terms or will sustain some loss if the deficiencies are not corrected.
Current wording
Loans classified as substandard or worse are considered for testing as individually analyzed loans. A substandard loan shows signs of continuing negative financial trends and unprofitability, and therefore is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. The borrower on such loans typically exhibits one or more of the following characteristics: financial ratios and profitability margins are well below industry average; a negative cash flow position exists; debt service capacity is insufficient to the service debt and an improvement in the cash flow position is unlikely within the next twelve months; and secondary and tertiary means of debt repayment are weak. Loans classified as substandard are characterized by the probability that we will not collect amounts due according to the contractual terms or will sustain some loss if the deficiencies are not corrected.
Previous wording
Impaired loans include loans that have been classified as substandard or worse. However, certain loans have been paying as agreed and have remained current, with some financial issues related to cash flow that have caused some concern as to the ability of the borrower to perform in accordance with the current loan terms but not to such extent as to require the loan to be put into a non-accruing status. Cash receipts on impaired loans are recorded as interest income as received, unless the loan is in a nonaccrual status.
Current wording
Individually analyzed loans generally include loans that have been classified as substandard or worse. However, certain loans have been paying as agreed and have remained current, with some financial issues related to cash flow that have caused some concern as to the ability of the borrower to perform in accordance with the current loan terms but not to such extent as to require the loan to be put into a non-accruing status. Cash receipts on individually analyzed loans are recorded as interest income as received, unless the loan is in a nonaccrual status.
Previous wording
As an integral part of their examination process, the Federal Deposit Insurance Corporation and the New York State Department of Financial Services will periodically review our allowance for credit losses, and as a result of such reviews, we may have to adjust our allowance for credit losses. However, regulatory agencies are not directly involved in the process for establishing the allowance for credit losses as the process is our responsibility and any increase or decrease in the allowance is the responsibility of management. The following table sets forth activity in our allowance for loan losses for the periods indicated.
Current wording
As an integral part of their examination process, the Federal Deposit Insurance Corporation and the New York State Department of Financial Services will periodically review our allowance for credit losses, and as a result of such reviews, we may have to adjust our allowance for credit losses. However, regulatory agencies are not directly involved in the process for establishing the allowance for credit losses as the process is our responsibility and any increase or decrease in the allowance is the responsibility of management. The following table sets forth activity in our allowance for credit losses for the years indicated.
Previous wording
We measure and record the allowance for credit losses based upon a discounted cash flow and remaining life model. Under this approach, management estimates the lifetime credit losses inherent in loans as of the balance sheet date. The discounted cash flow method calculates the expected cash flows to be received over the life of each individual loan in a pool. The remaining life methodology uses average charge-off rates and the remaining life of the loan to estimate the loan allowance for credit losses. The average annual charge-off rate is applied to the amortization adjusted remaining life of the loan to determine the unadjusted lifetime historical charge-off rate. Additionally, the allowance for credit losses
Current wording
We measure and record the allowance for credit losses based upon a discounted cash flow and weighted average remaining life model. Under this approach, management estimates the lifetime credit losses inherent in loans as of the balance sheet date. The discounted cash flow method calculates the expected cash flows to be received over the life of each individual loan in a pool. The weighted average remaining life methodology uses average charge-off rates and the remaining life of the loan to estimate the loan allowance for credit losses. The average annual charge-off rate is applied to the amortization adjusted remaining life of the loan to determine the unadjusted lifetime historical charge-off rate. Additionally, the allowance for credit losses calculation includes subjective adjustments for qualitative risk factors that are likely to cause
Previous wording
calculation includes subjective adjustments for qualitative risk factors that are likely to cause estimated credit losses to differ from historical experience. These qualitative adjustments may increase or reduce reserve levels and include adjustments for lending management experience and risk tolerance, asset quality and portfolio trends, loan review and audit results, loan portfolio growth, industry concentrations, trends in underlying collateral, external factors and economic conditions not already captured.
Current wording
estimated credit losses to differ from historical experience. These qualitative adjustments may increase or reduce reserve levels and include adjustments for lending management experience and risk tolerance, asset quality and portfolio trends, loan review and audit results, loan portfolio growth, industry concentrations, trends in underlying collateral, external factors and economic conditions not already captured.
Previous wording
The Company records an allowance for credit losses on off-balance sheet credit exposures, unless the commitments to extend credit are unconditionally cancelable, through a charge to provision for unfunded commitments in the Company’s statements of earnings. The allowance for credit losses on off-balance sheet credit exposures is estimated by loan segment at each balance sheet date under the current expected credit loss model using the same methodologies as portfolio loans, taking into consideration the likelihood that funding will occur as well as any third-party guarantees. Upon adoption of ASU 2016-13 on October 1, 2023, the Company made an initial adjustment for the reserve of $29,000. The allowance for credit losses for unfunded commitments of $25,000 at September 30, 2024 is included in other liabilities on the Company’s consolidated statements of financial condition.
Current wording
The Company records an allowance for credit losses on off-balance sheet credit exposures, unless the commitments to extend credit are unconditionally cancelable, through a charge to provision for unfunded commitments in the Company’s statements of earnings. The allowance for credit losses on off-balance sheet credit exposures is estimated by loan segment at each balance sheet date under the current expected credit loss model using the same methodologies as portfolio loans, taking into consideration the likelihood that funding will occur as well as any third-party guarantees. Upon adoption of ASU 2016-13 on October 1, 2023, the Company made an initial adjustment for the reserve of $29,000. The allowance for credit losses for unfunded commitments of $23,000 at September 30, 2025 is included in other liabilities on the Company’s consolidated statements of financial condition.
Previous wording
Changes in the allowance for credit loss are recorded as provision for (benefit from) credit loss expense. Losses are charged against the allowance for credit loss when management believes an available for sale security is confirmed to be
Current wording
Changes in the allowance for credit loss are recorded as provision for (benefit from) credit loss expense. Losses are charged against the allowance for credit loss when management believes an available for sale security is confirmed to be uncollectible or when either of the criteria regarding intent or requirement to sell is met. At September 30, 2025, there was no allowance for credit loss related to the available for sale securities portfolio.
Previous wording
Accrued interest receivable on available for sale debt securities totaled $246,000 at September 30, 2024 and was excluded from the estimate of credit losses.
Current wording
Accrued interest receivable on available for sale debt securities totaled $214,000 at September 30, 2025 and was excluded from the estimate of credit losses.
Previous wording
Liquidity describes our ability to meet the financial obligations that arise in the ordinary course of business. Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures. Our primary sources of funds are deposits, principal and interest payments on loans and securities, proceeds from the sale of loans and proceeds from sales and maturities of securities. We also rely on borrowings from the Federal Home Loan Bank as supplemental sources of funds. At September 30, 2024, there were no outstanding advances from the Federal Home Loan Bank and we had the ability to borrow $59.3 million. Additionally, at September 30, 2024, we had a line of credit with the Federal Reserve Discount Window totaling $5.0 million and a second line of credit with Atlantic Community Banker’s Bank totaling $4.0 million. At September 30, 2024, there were no outstanding balances under any of these additional credit facilities.
Current wording
Liquidity describes our ability to meet the financial obligations that arise in the ordinary course of business. Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures. Our primary sources of funds are deposits, principal and interest payments on loans and securities, proceeds from the sale of loans and proceeds from sales and maturities of securities. We also rely on borrowings from the Federal Home Loan Bank as supplemental sources of funds. At September 30, 2025, there were $7.0 million in outstanding advances from the Federal Home Loan Bank and we had the ability to borrow $54.9 million. Additionally, at September 30, 2025, we had a line of credit with the Federal Reserve Discount Window totaling $5.0 million and a second line of credit with Atlantic Community Banker’s Bank totaling $4.0 million. At September 30, 2025, there were no outstanding balances under any of these additional credit facilities.
Previous wording
Our cash flows are comprised of three primary classifications: cash flows from operating activities; investing activities and financing activities. Net cash provided by (used in) operating activities was $(3.0) million and $5.7 million for the years ended September 30, 2024 and 2023, respectively. Net cash provided by investing activities, which consists primarily of disbursements for loan originations and purchases and the purchase of securities available-for-sale, offset by principal collections on loans, proceeds from sales, maturities and principal payments received on securities available-for-sale, was $6.8 million and $1.8 million for the years ended September 30, 2024 and 2023, respectively. Net used in financing activities, consisting primarily of activity in deposit accounts and Federal Home Loan Bank advances, was $7.9 million and $11.4 million for the years ended September 30, 2024 and 2023, respectively.
Current wording
Our cash flows are comprised of three primary classifications: cash flows from operating activities; investing activities and financing activities. Net cash provided by (used in) operating activities was $0.9 million and $(3.0) million for the years ended September 30, 2025 and 2024, respectively. Net cash (used in) provided by investing activities, which consists primarily of disbursements for loan originations and purchases and the purchase of securities available-for-sale, offset by principal collections on loans, proceeds from sales, maturities and principal payments received on securities available-for-sale, was $(3.6) million and $6.8 million for the years ended September 30, 2025 and 2024, respectively. Net cash provided by (used in) financing activities, consisting primarily of activity in deposit accounts and Federal Home Loan Bank advances, was $1.0 million and $(7.9) million for the years ended September 30, 2025 and 2024, respectively.
Previous wording
The Company is a separate legal entity from the Bank and must provide for its own liquidity to pay its operating expenses and other financial obligations and to fund repurchases of shares of common stock. The Company’s primary source of income is dividends received from the Bank. The amount of dividends that the Bank may declare and pay to the Company is governed by applicable bank regulations. At September 30, 2024, the Company (on an unconsolidated basis) had liquid assets of $2.4 million.
Current wording
The Company is a separate legal entity from the Bank and must provide for its own liquidity to pay its operating expenses and other financial obligations and to fund repurchases of shares of common stock. The Company’s primary source of income is dividends received from the Bank. The amount of dividends that the Bank may declare and pay to the Company is governed by applicable bank regulations. At September 30, 2025, the Company (on an unconsolidated basis) had liquid assets of $1.3 million.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
customers. We believe that there are opportunities to increase our residential mortgage lending in our market area, and we intend to continue our emphasis on originating one- to four-family loans that meet our underwriting standards.
Current report — wording carried from elsewhere
exposures deemed to be uncollectible are charged against the allowance for credit losses. Recoveries of previously charged off amounts are credited to the allowance for credit losses.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
Our results of operations depend primarily on our net interest income. Net interest income is the difference between the interest income we earn on our interest-earning assets, consisting primarily of loans and securities, and the interest we
Previous report — wording carried elsewhere
●Increasing municipal deposits as a cost-effective source of funds to help generate future spread income. To enhance our deposit taking activities, the Bank operates a limited-purpose wholly owned subsidiary, GS&L Municipal Bank, that was formed in September 2022 as a New York-chartered limited purpose commercial bank. We maintain GS&L Municipal Bank as a limited purpose commercial bank subsidiary because, under New York municipal laws, a New York-
Previous report — wording carried elsewhere
effect of scheduled principal repayments, prepayments, or early redemptions that may occur. Yields on tax-exempt obligations have not been computed on a tax-equivalent basis, as the effect would not be material.
Previous report — wording carried elsewhere
uncollectible or when either of the criteria regarding intent or requirement to sell is met. At September 30, 2024, there was no allowance for credit loss related to the available for sale securities portfolio.