Hoyne Bancorp, Inc.

Previous wording

This discussion and analysis is intended to assist in the understanding of our financial performance through a discussion of our financial condition as of September 30, 2025 (unaudited) and as compared to our financial condition as of December 31, 2024 (audited) and our results of operations for the nine and three month periods ended September 30, 2025 and 2024 (unaudited). This section should be read in conjunction with the unaudited consolidated financial statements and notes thereto appearing in Part 1 Item 1 of this Quarterly Report on Form 10Q and the Prospectus.

Current wording

This discussion and analysis is intended to assist in the understanding of our financial performance through a discussion of our financial condition as of March 31, 2026 (unaudited) and as compared to our financial condition as of December 31, 2025 (audited) and our results of operations for the three month periods ended March 31, 2026 and 2025 (unaudited). This section should be read in conjunction with the unaudited consolidated financial statements and notes thereto appearing in Part 1 Item 1 of this Quarterly Report on Form 10-Q.

Previous wording

Forward-looking statements are based on current beliefs and expectations of management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements: general economic conditions, either nationally or in our market areas, that are worse than expected; changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses; our ability to access cost-effective funding; fluctuations in real estate values and both residential and commercial real estate market conditions; demand for loans and deposits in our market area; our ability to implement and change our business strategies; competition among depository and other financial institutions; inflation and changes in the interest rate environment that reduce our margins and yields, the fair value of financial instruments or our level of loan originations, or increase in the level of defaults, losses and prepayments on loans we have made; adverse changes in the securities or secondary mortgage markets; changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees, capital requirements and insurance premiums; changes in monetary or fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board; changes in the quality or composition of our loan or investment portfolios; technological changes that may be more difficult or expensive than expected; a failure or breach of our operational or security systems or infrastructure, including cyber-attacks; the inability of third party providers to perform as expected; our ability to manage market risk, credit risk and operational risk in the current economic environment; our ability to enter new markets successfully and capitalize on growth opportunities; our ability to successfully integrate into our operations any assets, liabilities, customers, systems and management personnel we may acquire and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related there to; changes in consumer spending, borrowing and savings habits; changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission (the “Commission”) or the public accounting oversight board; our ability to retain key employees; and our compensation expense associated with equity allocation or awarded our employees.

Current wording

These forward-looking statements are based on current beliefs and expectations of our management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change.

Previous wording

Hoyne Bancorp, Inc. (the “Company”, and together with Hoye Savings, MHC, Hoyne Financial Corporation and Hoyne Savings Bank, “we” or “us”) is a Delaware corporation which was incorporated in June 2025 and has not engaged in any business to date. Upon completion of the Conversion (as described below), we will own all of the issued and outstanding stock of Hoyne Savings Bank (the “Bank”). After the conversion is complete, we will be authorized to pursue other business activities permitted by applicable laws and regulations.

Current wording

Hoyne Bancorp, Inc. (the “Company”, and together with Hoyne Savings Bank, “we” or “us”) is a Delaware corporation which was incorporated in June 2025.

Previous wording

Our primary sources of funds consist of attracting deposits from the general public and using those funds and other sources to originate loans to our customers and invest in securities. As of September 30, 2025, we had total assets of $454.8 million, including $249.4 million in net loans and $108.8 million of investment securities available-for-sale, and investment securities held-to-maturity of $29.8 million, total deposits of $356.8 million and total equity of $90.1 million. For the nine months ended September 30, 2025, we had a net income of $31,000 compared to a net loss of $1.5 million for the nine months ended September 30, 2024.

Current wording

Our primary sources of funds consist of attracting deposits from the general public and using those funds and other sources to originate loans to our customers and invest in securities. As of March 31, 2026, we had total assets of $477.2 million, including $288.6 million in net loans and $103.7 million of investment securities available-for-sale, and investment securities held-to-maturity of $27.2 million, total deposits of $312.0 million and total stockholders’ equity of $161.1 million. For the three months ended March 31, 2026, we had a net loss of $118,000 compared to a net loss of $166,000 for the three months ended March 31, 2025.

Previous wording

Our results of operations depend, to a large extent, on net interest income, which is the difference between the income earned on our loan and investment portfolios and interest expense on deposits and borrowings. Our net interest income is largely determined by our net interest spread, which is the difference between the average yield earned on interest-earning assets and the average rate paid on interest-bearing liabilities, and the relative amounts of interest-earning assets and interest-bearing liabilities. Results of operations are also affected by our provisions for loan losses, fee income and other noninterest income and noninterest expense. Noninterest expense principally consists of compensation, office occupancy and equipment expense, data processing, advertising and business promotion and other expenses. After the conversion, we expect that our noninterest expenses will increase as we grow and expand our operations. In addition, our compensation expense will increase due to the new stock benefit plans we intend to implement. See “Pro Forma Data.” Our results of operations and financial condition are also significantly affected by general economic and competitive conditions, particularly changes in interest rates, changes in accounting guidance, government policies and actions of regulatory authorities.

Current wording

Our results of operations depend, to a large extent, on net interest income, which is the difference between the income earned on our loan and investment portfolios and interest expense on deposits and borrowings. Our net interest income is largely determined by our net interest spread, which is the difference between the average yield earned on interest-earning assets and the average rate paid on interest-bearing liabilities, and the relative amounts of interest-earning assets and interest-bearing liabilities. Results of operations are also affected by our provisions for loan losses, fee income and other noninterest income and noninterest expense. Noninterest expense principally consists of compensation, office occupancy and equipment expense, data processing, advertising and business promotion and other expenses. We expect that our noninterest expenses will increase as we continue to grow and expand our operations. In addition, our compensation expense will increase due to the new stock benefit plans we intend to implement in the next 12 to 18 months. Our results of operations and financial condition are also significantly affected by general economic and competitive conditions, particularly changes in interest rates, changes in accounting guidance, government policies and actions of regulatory authorities.

Previous wording

The discussion and analysis of the financial condition and results of operations are based on our consolidated financial statements, which are prepared to conform with generally accepted in the United States of America (“U.S. GAAP”) and to general practices within the banking industry. The preparation of the financial statements require certain estimates, judgments, and assumptions, which are believed to be reasonable based upon the information available. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the periods presented. The Jumpstart Our Business Startups Act of 2012 contains provisions that, among other things, reduce certain reporting requirements for qualifying public companies. As an “emerging growth company” we may delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. We intend to take advantage of the benefits of this extended transition period. Accordingly, our financial statements may not be comparable to companies that comply with such new or revised accounting standards.

Current wording

The discussion and analysis of the financial condition and results of operations are based on our consolidated financial statements, which are prepared to conform with generally accepted in the United States of America (“U.S. GAAP”) and to general practices within the banking industry. The preparation of the financial statements require certain estimates, judgments, and assumptions, which are believed to be reasonable based upon the information available. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the periods presented. The Jumpstart Our Business Startups Act of 2012 contains provisions that, among other things, reduce certain reporting requirements for qualifying public companies. As an “emerging growth company” we may delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. We have opted to take advantage of the benefits of this extended transition period. Accordingly, our financial statements may not be comparable to companies that comply with such new or revised accounting standards.

Previous wording

Total Assets. Total assets increased $5.3 million or 1.2% to $454.8 million as of September 30, 2025 compared to $449.5 million as of December 31, 2024. The increase resulted primarily from increases in cash and cash equivalents of $11.6 million, real estate owned of $729,000, loans receivable, net of $8.5 million and other assets of $1.3 million. These increases were offset by decreases in certificates of deposit of $480,000, investment securities available- for-sale of $7.7 million, investment securities held-to-maturity of $4.2 million, premises and equipment, net of $419,000 and BOLI of $2.2 million.

Current wording

Total Assets. Total assets decreased $12.2 million or 2.5% to $477.2 million as of March 31, 2026 compared to $489.4 million as of December 31, 2025. The decrease resulted primarily from decreases in cash and cash equivalents of $34.1 million, investment securities available-for-sale of $3.0 million, and investment securities held to maturity of $1.2 million. These decreases were offset by increases in loans receivable, net of $20.7 million, and Bank Owned Life Insurance of $5.2 million.

Previous wording

Investment Securities Available-for-Sale. Investment securities available-for-sale decreased $7.7 million, or 6.6%, to $108.8 million as of September 30, 2025 from $116.5 million as of December 31, 2024. The liquidity from the decrease was used to fund the increase in our loan portfolio.

Current wording

Investment Securities Available-for-Sale. Investment securities available-for-sale decreased $3.0 million, or 2.8%, to $103.7 million as of March 31, 2026 from $106.7 million as of December 31, 2025 as a result of maturities and paydowns. The liquidity from the decrease was used to fund the increase in our loan portfolio.

Previous wording

Investment Securities Held-to-Maturity. Investment securities held-to-maturity decreased $4.2 million, or 12.4%, to $29.8 million as of September 30, 2025 from $34.0 million as of December 31, 2024. The liquidity from the decrease was used to fund the increase in our loan portfolio.

Current wording

Investment Securities Held-to-Maturity. Investment securities held-to-maturity decreased $1.2 million, or 4.2%, to $27.2 million as of March 31, 2026 from $28.4 million as of December 31, 2025 as a result of maturities and paydowns. The liquidity from the decrease was used to fund the increase in our loan portfolio.

Previous wording

Loans Receivable, Net. Loans receivable, net increased $8.5 million, or 3.5%, to $249.4 million from $240.9 million as of December 31, 2024. The increase reflects the emphasis to increase the commercial loan portfolio during the first nine months of 2025.

Current wording

Loans Receivable, Net. Loans receivable, net increased $20.7 million, or 7.7%, to $288.6 million as of March 31, 2026 from $267.9 million as of December 31, 2025. The increase reflects the continued emphasis on growing the commercial loan portfolio.

Previous wording

Premises and Equipment, Net. Premises and equipment, net decreased $419,000 or 5.4% to $7.3 million during the first nine months of 2025 from $7.7 million as of December 31, 2024 due primarily to the branch closing discussed under “Real Estate Owned.”

Current wording

Premises and Equipment, Net. Premises and equipment, net decreased $111,000, or 1.5%, to $7.3 million as of March, 31, 2026 from $7.4 million as of December 31, 2025, due primarily to depreciation.

Previous wording

Total Equity. Total equity for the first nine months of 2025 increased $4.3 million, or 5.0%, to $90.1 million from $85.8 million as of December 31, 2024. The increase was due primarily to a decrease in accumulated other comprehensive loss of $4.3 million during the first nine months of 2025.

Current wording

Total Stockholders’ Equity. Total stockholders’ equity for the first three months of 2026 decreased $283,000, or 0.2%, to $161.1 million from $161.4 million as of December 31, 2025. The decrease was due primarily to an increase in accumulated other comprehensive loss of $257,000 during the first three months of 2026 due to the rate environment for available-for-sale assets.

Previous wording

Average Balances, Net Interest Income, and Yields Earned and Rates Paid. The following table shows for the periods indicated the total dollar amount of interest from average interest-earning assets and the resulting yields, as well as the interest expense on average interest-bearing liabilities, expressed both in dollars and rates, and the net interest margin. All average balances are based on daily balances. The table also reflects the yields on Hoyne Savings Bank’s interest-earning assets and costs of interest-bearing liabilities for the periods shown.

Current wording

Average Balances, Net Interest Income, and Yields Earned and Rates Paid. The following table shows for the periods indicated the total dollar amount of interest earned from average interest-earning assets and the resulting yields,

Previous wording

General. For the nine months ended September 30, 2025 compared to the same period in 2024, net loss decreased $1.6 million or 102.0%, to a net income of $31,000 for the nine months ended September 30, 2025 compared to a net loss of $1.5 million for the same period in 2024. The primary reasons for the decrease in net loss was an increase of $2.5 million in total interest income and a decrease in interest expense on deposits of $498,000 offset by an increase of $498,000 in noninterest expense.

Current wording

General. For the three months ended March 31, 2026 compared to the same period in 2025, net loss decreased $48,000, or 28.7%, to a net loss of $118,000 for the three months ended March 31, 2026 compared to a net loss of $166,000 for the same period in 2025. The primary reasons for the decrease in net loss was an increase of $578,000 in total interest income and a decrease in interest expense on deposits of $614,000, offset by a decrease of $20,000 in noninterest income and an increase of $1.1 million in noninterest expense.

Previous wording

Interest Income. Interest income increased $815,000, or 19.5%, to $5.0 million for the three months ended September 30, 2025 compared to $4.2 million for the same period in 2024. The increase in interest income was due to an $1.1 million increase in interest income on loans receivable as a result of the growth in the commercial loan portfolio. The increase was partially offset by a $245,000 decrease in interest income on investment securities due to a decrease in account balances. Other interest income decreased by $65,000. The excess liquidity generated from the decrease in investment and cash account balances was used to fund the growth in the commercial loan portfolio

Current wording

Interest Income. Interest income increased $578,000, or 12.3%, to $5.3 million for the three months ended March 31, 2026 compared to $4.7 million for the same period in 2025. The increase in interest income was due to a $614,000 increase in interest income on loans receivable as a result of the growth in the commercial loan portfolio. The increase was partially offset by a $134,000 decrease in interest income on investment securities due to a decrease in account balances as a result of maturities and paydowns. Other interest income increased by $98,000. The excess liquidity generated from the decrease in investment securities and cash account balances was used to fund the growth in the commercial loan portfolio.

Previous wording

Interest Expense on Deposits. Interest expense on deposits decreased $222,000, or 12.3%, to $1.6 million for the three months ended September 30, 2025 compared to $1.8 million for the three months ended September 30, 2024. The decrease was primarily caused by lower interest rates on certain accounts as deposits remained relatively unchanged.

Current wording

Interest Expense on Deposits. Interest expense on deposits decreased $614,000, or 36.2%, to $1.1 million for the three months ended March 31, 2026 compared to $1.7 million for the three months ended March 31, 2025. The decrease was primarily caused by the decrease in deposits as interest rates remained relatively unchanged.

Previous wording

Tax Expense (benefit). Tax expense (benefit) decreased $272,000, or 110.3%, to an income tax expense of $26,000 for the three months ended September 30, 2025, from a $247,000 income tax benefit for the same period in 2024. The major factor in the decrease was the net income before taxes for the three months ended September 30, 2025 compared to the same period in 2024.

Current wording

Tax Expense (benefit). Tax expense (benefit) decreased $21,000, or 27.3%, to $56,000 for the three months ended March 31, 2026, from $77,000 for the same period in 2025. The major factor in the decrease was the lower net loss between the periods.

Previous wording

Hoyne Savings Bank maintains levels of liquid assets deemed adequate by management. We adjust our liquidity levels to fund deposit outflows, repay our borrowings, and to fund loan commitments. We also adjust liquidity, as appropriate, to meet asset and liability management objectives.

Current wording

We maintain levels of liquid assets deemed adequate by management. We adjust our liquidity levels to fund deposit outflows, repay our borrowings, and to fund loan commitments. We also adjust liquidity, as appropriate, to meet asset and liability management objectives.

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, and proceeds from maturities of securities. We also have the ability to borrow from the FHLB of Chicago. As of September 30, 2025, we had no outstanding advances from the FHLB of Chicago, and had the capacity to borrow approximately $67.6 million from the FHLB of Chicago.

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, and proceeds from maturities of securities. We also have the ability to borrow from the FHLB of Chicago. As of March 31, 2026, we had no outstanding advances from the FHLB of Chicago, and had the capacity to borrow approximately $65.7 million from the FHLB of Chicago.

Previous wording

Our cash flows are comprised of three primary classifications: cash flows provided by (used in) operating activities, investing activities, and financing activities. Net cash provided by (used in) operating activities was ($25,000) and $1.3 million for the nine months ended September 30, 2025 and 2024, respectively. Net cash provided by (used in) investing activities, which consists primarily of change in loans receivable, was $11.1 million and $5.2 million for the nine months ended September 30, 2025 and 2024, respectively. Net cash provided by (used in) by financing activities, which primarily consists of change in deposits, was $509,000 and ($10.3) million for the nine months ended September 30, 2025 and 2024, respectively.

Current wording

Our cash flows are comprised of three primary classifications: cash flows provided by (used in) operating activities, investing activities, and financing activities. Net cash provided by (used in) operating activities was ($821,000) and $905,000 for the three months ended March 31, 2026 and 2025, respectively. Net cash provided by (used in) investing activities, which consists primarily of change in loans receivable, was ($22.1 million) and $2.3 million for the three months ended March 31, 2026 and 2025, respectively. Net cash provided by (used in) financing activities, which primarily consists of change in deposits, was ($11.2 million) and $12.6 million for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

As of September 30, 2025, Hoyne Savings Bank was well capitalized under the regulatory framework for prompt corrective action. During the year ended December 31, 2023, Hoyne Savings Bank elected to begin using the Community Bank Leverage Ratio Framework (the “CBLRF”). Under CBLRF, if a qualifying depository institution or depository institution holding company elects to use such measure, such institution or holding company will be considered well capitalized if its ratio of Tier 1 capital to average total consolidated assets (i.e., leverage ratio) exceeds 9.0% subject to a limited two-quarter grace period, during which the leverage ratio cannot go 100 basis points below the then- applicable threshold, and will not be required to calculate and report risk-based capital ratios. Hoyne Savings Bank’s Tier 1 capital to average assets for the leverage ratio was 20.2% and 19.9% as of September 30, 2025 and December 31, 2024, respectively. Additionally, as of September 30, 2025, we exceeded all of our regulatory capital requirements with a Tier 1 leverage capital level by $40.0 million, or 11.2%.

Current wording

As of March 31, 2026, Hoyne Savings Bank was considered well capitalized under the regulatory framework for prompt corrective action. During the year ended December 31, 2023, Hoyne Savings Bank elected to begin using the Community Bank Leverage Ratio Framework (the “CBLRF”). Under CBLRF, if a qualifying depository institution or depository institution holding company elects to use such measure, such institution or holding company will be considered well capitalized if its ratio of Tier 1 capital to average total consolidated assets (i.e., leverage ratio) exceeds 9.0% subject to a limited two-quarter grace period, during which the leverage ratio cannot go 100 basis points below the then- applicable threshold, and will not be required to calculate and report risk-based capital ratios. Hoyne Savings Bank’s Tier 1 capital to average assets for the leverage ratio was 27.8% and 24.8% as of March 31, 2026 and December 31, 2025, respectively. Additionally, as of March 31, 2026, we exceeded all of our regulatory capital requirements with a Tier 1 leverage capital level by $90.0 million, or 18.8%.

Previous wording

Off-Balance Sheet Arrangements*.*As of September 30, 2025, we had $26.8 million of outstanding commitments to originate loans. Our total letters and lines of credit and unused lines of credit totaled $9.1 million as of September 30, 2025. We had unfunded construction loans as of September 30, 2025 of $15.0 million. Certificates of deposit that are scheduled to mature in less than one year from September 30, 2025, totaled $152.5 million. Management expects that a substantial portion of the maturing certificates of deposit will be renewed. However, if a substantial portion of these deposits is not retained, we may utilize FHLB of Chicago advances or raise interest rates on deposits to attract new accounts, which may result in higher levels of interest expense.

Current wording

Off-Balance Sheet Arrangements*.*As of March 31, 2026, we had $57.5 million of outstanding commitments to originate loans. We had unfunded construction loans as of March 31, 2026 of $14.0 million. Certificates of deposit that are scheduled to mature in less than one year from March 31, 2026, totaled $147.4 million. Management expects that a

Previous wording

The consolidated financial statements and related financial data presented herein regarding Hoyne Savings Bank have been prepared in accordance with U.S. GAAP, which generally require the measurement of financial position and operating results in terms of historical dollars, without considering changes in relative purchasing power over time due to inflation. Unlike most industrial companies, virtually all of our assets and liabilities are monetary in nature. As a result, interest rates generally have a more significant impact on Hoyne Savings Bank’s performance than does the effect of inflation. Interest rates do not necessarily move in the same direction or in the same magnitude as the prices of goods and services, since such prices are affected by inflation to a larger extent than interest rates.

Current wording

The consolidated financial statements and related financial data presented herein have been prepared in accordance with U.S. GAAP, which generally require the measurement of financial position and operating results in terms of historical dollars, without considering changes in relative purchasing power over time due to inflation. Unlike most industrial companies, virtually all of our assets and liabilities are monetary in nature. As a result, interest rates generally have a more significant impact on our performance than does the effect of inflation. Interest rates do not necessarily move in the same direction or in the same magnitude as the prices of goods and services, since such prices are affected by inflation to a larger extent than interest rates.

Previous wording

The table above indicates that as of September 30, 2025, in the event of an immediate and sustained 300 basis point increase in interest rates, our net interest income for the twelve months ending September 30, 2026 would be expected to decrease by $1.9 million, or 13.3% to $12.1 million.

Current wording

The table above indicates that as of March 31, 2026, in the event of an immediate and sustained 300 basis point increase in interest rates, our net interest income for the twelve months ending March 31, 2027 would be expected to decrease by $1.2 million, or 6.3% to $17.6 million.