Gouverneur Bancorp, Inc./MD/
For the period ended Mar 31, 2026. Filed May 12, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 12, 2026
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What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-12-31; filed 2026-02-12.
0001104659-26-013949
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-12.
0001104659-26-059375
Item 2. 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 62 previous paragraphs and 84 current paragraphs.
33 unchanged; 27 reworded; 14 added; 2 removed; 0 previous and 10 current paragraphs rearranged.
Tables are not compared: 11 previous and 17 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 (14)
Current report
Non-performing loans were $959,000 and $695,000 at March 31, 2026 and September 30, 2025, respectively. At March 31, 2026 and September 30, 2025, non-performing loans consisted of $851,000 and $679,000 of non-performing residential mortgage loans, respectively.
Current report
The decrease in total non-interest expense included a $33,000 decrease in salaries and employee benefits for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. This was primarily due to staffing changes over the prior year. Foreclosed assets, net decreased $6,000 to a net benefit of $6,000 for the three months ended March 31, 2026, compared to no expense for the three months ended March 31, 2025. The change was primarily due to the sale of a foreclosed property during the three months ended March 31, 2026.
Current report
Financial Highlights
Current report
Net income for the six months ended March 31, 2026 was $504,000, compared to $278,000 for the six months ended March 31, 2025. Net income for the six months ended March 31, 2026 was higher than the six months ended March 31, 2025 primarily due to a $103,000 gain recognized from a bank-owned life insurance death benefit and a $165,000 increase in net interest income. The Company also recorded an $18,000 provision for credit losses for the six months ended March 31, 2026 compared to a $15,000 provision for credit losses for the six months ended March 31, 2025. Interest expense for the six months ended March 31, 2026 was $787,000 compared to $791,000 for the six months ended March 31, 2025, primarily due to a $104,000 decrease in interest expense on deposits, partially offset by a $100,000 increase in interest expense in Federal Home Loan Bank advances.
Current report
Net Interest Income
Current report
Net interest income totaled $3.7 million for the six months ended March 31, 2026, as compared to $3.5 million for the six months ended March 31, 2025. Net interest income for the six months ended March 31, 2026 increased by $165,000, or 4.70%, primarily due to an increase in interest income on loans of $276,000 and a decrease in interest expense on deposits
Current report
of $104,000, partially offset by an increase in interest expense in Federal Home Loan Bank advances of $100,000 and a decrease in interest income on securities of $86,000.
Current report
Interest expense decreased by $4,000, or 0.51%, due to a decrease in interest expense on deposits, partially offset by an increase in Federal Home Loan Bank borrowing interest expense.
Current report
Provision for Credit Losses
Current report
Non-performing loans were $959,000 and $695,000 at March 31, 2026 and September 30, 2025, respectively. At March 31, 2026 and September 30, 2025, non-performing loans consisted of $851,000 and $679,000 of non-performing residential mortgage loans, respectively.
Current report
Non-Interest Income
Current report
Non-Interest Expense
Current report
Income Taxes
Current report
Non-performing loans were $959,000 and $695,000 at March 31, 2026 and September 30, 2025, respectively. At March 31, 2026 and September 30, 2025, non-performing loans consisted of $851,000 and $679,000 of non-performing residential mortgage loans, respectively.
Removed paragraphs (2)
Previous report
Non-performing loans were $991,000 and $695,000 at December 31, 2025 and September 30, 2025, respectively. At December 31, 2025 and September 30, 2025, non-performing loans consisted of $975 thousand and $679 thousand of non-performing residential mortgage loans, respectively.
Previous report
Non-performing loans were $991,000 and $695,000 at December 31, 2025 and September 30, 2025, respectively. At December 31, 2025 and September 30, 2025, non-performing loans consisted of $975 thousand and $679 thousand of non-performing residential mortgage loans, respectively.
Reworded paragraphs (27)
Previous wording
The Company cautions readers of this report that a number of important factors could cause the Company’s actual results to differ materially from those expressed in forward-looking statements. Factors that could cause actual results to differ from those predicted and could affect the future prospects of the Company include, but are not limited to: (i)general economic conditions, either nationally or in our market areas, that are worse than expected including as a result of employment levels and labor shortages, and the effects of inflation, a potential recession or slowed economic growth caused by supply chain disruptions or otherwise; (ii) changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for credit losses; (iii) our ability to access cost-effective funding; (iv) fluctuations in real estate values and both residential and commercial real estate market conditions; (v) demand for loans and deposits in our market area; (vi) deposit outflows and our ability to successfully manage liquidity; (vii) our ability to implement and change our business strategies, including our branching strategy; (viii) competition among depository and other financial institutions; (ix) 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 prepayments on loans we have made and make; (x) adverse changes in the securities or secondary mortgage markets; (xi) changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees and capital requirements and insurance premiums; (xii) changes in the quality or composition of our loan or investment portfolios; (xiii) technological changes that may be more difficult or expensive than expected; (xiv) the inability of third-party providers to perform as expected; (xv) our ability to manage market risk, credit risk and operational risk in the current economic environment; (xvi) our ability to enter new markets successfully and to capitalize on growth opportunities; (xvii) 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 thereto; (xvii) changes in consumer spending, borrowing and savings habits; (xix) 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 or the Public Company Accounting Oversight Board; (xx) our ability to attract and retain key employees; and (xxi) changes in financial condition, results of operations or future prospects of issuers of securities that we own; (xxii) changes in monetary and fiscal policies of the U.S. government, inc…
Excerpt shortened here; the source contains the full paragraph.
Current wording
The Company cautions readers of this report that a number of important factors could cause the Company’s actual results to differ materially from those expressed in forward-looking statements. Factors that could cause actual results to differ from those predicted and could affect the future prospects of the Company include, but are not limited to: (i)general economic conditions, either nationally or in our market areas, that are worse than expected including as a result of employment levels and labor shortages, and the effects of inflation, a potential recession or slowed economic growth caused by supply chain disruptions or otherwise; (ii) changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for credit losses; (iii) our ability to access cost-effective funding; (iv) fluctuations in real estate values and both residential and commercial real estate market conditions; (v) demand for loans and deposits in our market area; (vi) deposit outflows and our ability to successfully manage liquidity; (vii) our ability to implement and change our business strategies, including our branching strategy; (viii) competition among depository and other financial institutions; (ix) 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 prepayments on loans we have made and make; (x) adverse changes in the securities or secondary mortgage markets; (xi) changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees and capital requirements and insurance premiums; (xii) changes in the quality or composition of our loan or investment portfolios; (xiii) technological changes that may be more difficult or expensive than expected; (xiv) the inability of third-party providers to perform as expected; (xv) our ability to manage market risk, credit risk and operational risk in the current economic environment; (xvi) our ability to enter new markets successfully and to capitalize on growth opportunities; (xvii) our ability to receive all required regulatory approvals necessary for the Bank to convert from a New York chartered stock savings and loan association to a national banking association, and for the merger of GS&L Municipal Bank with and into the Bank immediately following the completion of the charter conversion, and, if such approvals are ultimatey received, our ability to recognize the anticipated benefits of such transactions; (xviii) 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 thereto; (xix) changes in consumer spending, borrowing and savings habits; (xx) changes in accounting policies and pr…
Excerpt shortened here; the source contains the full paragraph.
Previous wording
We consider accounting policies involving significant judgments and assumptions by management that have, or could have, a material impact on the carrying value of certain assets or on income to be critical accounting policies. We consider these accounting policies to be our critical accounting policies. The judgments and assumptions we use are based on historical experience and other factors, which we believe to be reasonable under the circumstances. Actual results could differ from these judgments and estimates under different conditions, resulting in a change that could have a material impact on the carrying values of our assets and liabilities and our results of operations.
Current wording
We consider accounting policies involving significant judgments and assumptions by management that have, or could have, a material impact on the carrying value of certain assets or on income to be critical accounting policies. We consider these accounting policies to be our critical accounting policies. The judgments and assumptions we use are based on historical experience and other factors, which we believe to be reasonable under the circumstances. Actual results could
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 three months ended December 31, 2025 discusses significant accounting policies, including the allowance for credit losses in accordance with 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. 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 three and six months ended March 31, 2026 discusses significant accounting policies, including the allowance for credit losses in accordance with ASC 326,*Financial Instruments – 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 $1.1 million as of December 31, 2025 in non-performing assets consisting primarily of $975 thousand non-performing real estate 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 $1.2 million as of March 31, 2026 in non-performing assets consisting primarily of $943 thousand non-performing real estate loans. We continue to assess the collectability of these loans and update our appraisals on these loans as appropriate.
Previous wording
We establish a specific allowance when loans are determined to not share common risk characteristics with pooled loans. The allowance is measured by determining the present value of expected future cash flows or, for collateral-dependent loans, the fair value of the collateral less estimated selling expenses. Factors in identifying a specific problem loan include but are not limited to: (1) the strength of the customer’s personal or business cash flows; (2) the availability of other sources of repayment; (3) the amount due or past due; (4) the type and value of collateral; (5) the strength of our collateral position; (6) the estimated cost to sell the collateral; and (7) the borrower’s effort to cure the delinquency. In addition, for loans secured by real estate, we consider the extent of any past due and unpaid property taxes applicable to the property serving as collateral on the mortgage.
Current wording
We establish a specific allowance when loans are determined to not share common risk characteristics with pooled loans. The allowance is measured by determining the present value of expected future cash flows or, for collateral-dependent loans, the fair value of the collateral less estimated selling expenses. Factors in identifying a specific problem loan include but are not limited to: (1) the strength of the customer’s personal or business cash flows; (2) the availability of other sources of repayment; (3) the amount due or past due; (4) the type and value of collateral; (5) the strength of our collateral position; (6) the estimated cost to sell the collateral; and (7) the borrower’s effort to cure the delinquency. In addition, for loans
Previous wording
Total assets increased by $3.4 million, or 1.69%, to $201.9 million at December 31, 2025 from $198.5 million at September 30, 2025. The increase in assets was primarily due to an increase in net loans receivable, net of $1.6 million and an increase in securities available for sale of $1.9 million resulting from an increase in market value from fluctuations in market rates and purchases, partially offset by a decrease in bank-owned life insurance resulting from the receipt of $566 thousand of death benefit proceeds.
Current wording
Total assets decreased by $0.2 million, or 0.10%, to $198.3 million at March 31, 2026 from $198.5 million at September 30, 2025. The decrease in assets was primarily due to a decrease in securities available for sale of $1.6 million and a decrease in bank-owned life insurance resulting from the receipt of $566 thousand of death benefit proceeds, partially offset by an increase in cash and cash equivalents of $1.3 million and an increase in loans receivable, net of $0.7 million.
Previous wording
Cash and cash equivalents increased by $0.1 million, or 1.07%, to $4.7 million at December 31, 2025 from $4.6 million at September 30, 2025. The increase in cash and cash equivalents can be primarily attributed to an increase in deposits of $3.7 million and the receipt of bank-owned life insurance death proceeds of $0.6 million, partially offset by an increase in loans receivable, net of $1.6 million and purchases of securities available for sale of $1.4 million for municipal deposit collateral requirements.
Current wording
Cash and cash equivalents increased by $1.3 million, or 28.18%, to $6.0 million at March 31, 2026 from $4.7 million at September 30, 2025. The increase in cash and cash equivalents can be primarily attributed to an increase in deposits of $5.2 million and a decrease in securities available for sale of $1.6 million, partially offset by an increase in loans receivable, net of $0.7 million and the repayment of $6.0 million of Federal Home Loan Bank advances.
Previous wording
Loans receivable, net of the allowance for credit losses, increased by $1.6 million, or 1.24%, to $133.1 million at December 31, 2025 from $131.5 million at September 30, 2025. The increase in loans receivable, net of the allowance for credit losses, was primarily due to an increase in originated loans by $2.3 million, partially offset by a decrease in total acquired loans of $0.7 million due to loan repayments.
Current wording
Loans receivable, net of the allowance for credit losses, increased by $0.7 million, or 0.53%, to $132.2 million at March 31, 2026 from $131.5 million at September 30, 2025. The increase in loans receivable, net of the allowance for credit losses, was primarily due to an increase in originated loans by $2.2 million, partially offset by a decrease in total acquired loans of $1.5 million due to loan repayments.
Previous wording
Securities available for sale increased by $1.9 million, or 4.56%, to $42.8 million at December 31, 2025 from $40.9 million at September 30, 2025. The increase was primarily due to reinvested proceeds for municipal deposit collateral requirements along with an increase in the market value on the portfolio. The unrealized loss on securities available for sale included in other comprehensive loss was $1.6 million at December 31, 2025, compared to $1.9 million at September 30, 2025, primarily due to fluctuations in market rates impacting the fair value of the investment portfolio.
Current wording
Securities available for sale decreased by $1.6 million, or 3.84%, to $39.3 million at March 31, 2026 from $40.9 million at September 30, 2025. The decrease was primarily due to principal paydowns, maturities and sales, partially offset by reinvested proceeds for municipal deposit collateral requirements along with an increase in the market value on the portfolio. The unrealized loss on securities available for sale included in other comprehensive loss was $1.7 million at March 31, 2026, compared to $1.9 million at September 30, 2025, primarily due to fluctuations in market rates impacting the fair value of the investment portfolio.
Previous wording
Total deposits increased by $3.7 million, or 2.42%, to $158.5 million at December 31, 2025 from $154.8 million at September 30, 2025. The increase in deposits can primarily be attributed to a $2.8 million increase in non-maturing deposits a $0.9 million increase in time deposits. The overall increase in deposits can be attributed to seasonal fluctuations with commercial and municipal deposits during the period. Uninsured deposits, which are the portion of deposit accounts that exceed the FDIC insurance limit, currently set at $250,000 per insured account, were approximately $34.1 million at December 31, 2025 and $31.6 million at September 30, 2025. Municipal deposits held at GS&L Municipal Bank accounted for approximately $21.8 million and $18.0 million of the uninsured deposits at December 31, 2025 and September 30, 2025, respectively. At December 31, 2025, we had $58.2 million in available liquidity with the Federal Home Loan Bank of New York and $4.7 million in cash and cash equivalents, which was sufficient to cover 100% of our 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
Total deposits increased by $5.2 million, or 3.36%, to $160.0 million at March 31, 2026 from $154.8 million at September 30, 2025. The increase in deposits can primarily be attributed to a $3.4 million increase in non-maturing deposits and a $1.8 million increase in time deposits. The overall increase in deposits can be attributed to seasonal fluctuations with commercial and municipal deposits during the period. Uninsured deposits, which are the portion of deposit accounts that exceed the FDIC insurance limit, currently set at $250,000 per insured account, were approximately $35.2 million at March 31, 2026 and $31.6 million at September 30, 2025. Municipal deposits held at GS&L Municipal Bank accounted for approximately $19.6 million and $18.0 million of the uninsured deposits at March 31, 2026 and September 30, 2025, respectively. At March 31, 2026, we had $62.7 million in available liquidity with the Federal Home Loan Bank of New York and $6.0 million in cash and cash equivalents, which was sufficient to cover 100% of our uninsured and uncollateralized deposits at March 31, 2026. Municipal deposits held by GS&L Municipal Bank are fully collateralized by available for sale government and collateralized mortgage obligation securities.
Previous wording
Federal Home Loan Bank advances decreased by $2.0 million, or 28.57%, to $5.0 million at December 31, 2025 from $7.0 million at September 30, 2025. The decrease in advances was primarily due to an increase in customer deposits, partially offset by an increase in loans receivable, net of allowance for credit losses.
Current wording
Federal Home Loan Bank advances decreased by $6.0 million, or 85.71%, to $1.0 million at March 31, 2026 from $7.0 million at September 30, 2025. The decrease in advances was primarily due to an increase in customer deposits, partially offset by an increase in loans receivable, net of allowance for credit losses.
Previous wording
Shareholders’ equity increased by $0.5 million, or 1.61%, to $32.6 million at December 31, 2025 from $32.1 million at September 30, 2025. The increase in shareholders’ equity was primarily a result of net income and a $0.3 million increase to the market value adjustment on the securities portfolio included in the accumulated other comprehensive income component, partially offset by the repurchase of common stock of $0.1 million which was returned to authorized but unissued stock. The Company also declared and paid dividends of $0.09 per share totaling $94,000 during the three months ended December 31, 2025.
Current wording
Shareholders’ equity increased by $0.6 million, or 1.94%, to $32.7 million at March 31, 2026 from $32.1 million at September 30, 2025. The increase in shareholders’ equity was primarily a result of net income and a $0.2 million increase to the market value adjustment on the securities portfolio included in the accumulated other comprehensive loss component, partially offset by the repurchase of common stock of $0.2 million which was returned to authorized but unissued stock. The Company also declared and paid dividends of $0.09 per share totaling $94,000 during the six months ended March 31, 2026.
Previous wording
Net income for the three months ended December 31, 2025 was $287,000, compared to $160,000 for the three months ended December 31, 2024. Net income for the three months ended December 31, 2025 was higher than the three months ended December 31, 2024 primarily due to a $103,000 gain recognized from a bank-owned life insurance death benefit and a $64,000 increase in net interest income. The Company also recorded a $13,000 provision for credit losses for the three months ended December 31, 2025 compared to a $15,000 provision for credit losses for the three months ended December 31, 2024. Interest expense for the three months ended December 31, 2025 was $411,000 compared to $401,000 for the three months ended December 31, 2024, primarily due to a $63,000 increase in interest expense in Federal Home Loan Bank advances, partially offset by a $53,000 decrease in interest expense on deposits.
Current wording
Net income for the three months ended March 31, 2026 was $217,000, compared to $118,000 for the three months ended March 31, 2025. Net income for the three months ended March 31, 2026 was higher than the three months ended March 31, 2025 primarily due to a $101,000 increase in net interest income. The Company also recorded a $5,000 provision for credit losses for the three months ended March 31, 2026 compared to no provision for credit losses for the three months ended March 31, 2025. Interest expense for the three months ended March 31, 2026 was $376,000 compared to $390,000 for the three months ended March 31, 2025, primarily due to a $51,000 decrease in interest expense on deposits, partially offset by a $37,000 increase in interest expense in Federal Home Loan Bank advances.
Previous wording
Net interest income totaled $1.8 million for the three months ended December 31, 2025 and also for the three months ended December 31, 2024. Net interest income for the three months ended December 31, 2025 increased by $64,000, or 3.63%, primarily due to an increase in interest income on loans of $133,000 and a decrease in interest expense on deposits of $53,000, partially offset by an increase in interest expense in Federal Home Loan Bank advances of $63,000.
Current wording
Net interest income totaled $1.8 million for the three months ended March 31, 2026, as compared to $1.7 million for the three months ended March 31, 2025. Net interest income for the three months ended March 31, 2026 increased by $101,000, or 5.78%, primarily due to an increase in interest income on loans of $143,000 and a decrease in interest expense on deposits of $51,000, partially offset by an increase in interest expense in Federal Home Loan Bank advances of $37,000 and a decrease in interest income on securities of $47,000.
Previous wording
Interest income increased by $74,000, or 3.42%, for the three months ended December 31, 2025 due to an increase in loan income from an increase in loan origination and loan repricing, partially offset by a decrease in interest on taxable securities.
Current wording
Interest income increased by $87,000, or 4.07%, for the three months ended March 31, 2026 due to an increase in loan income from an increase in loan origination and loan repricing, partially offset by a decrease in interest on taxable securities.
Previous wording
Interest expense increased by $10,000, or 2.49%, due to the increase in Federal Home Loan Bank borrowing interest expense, partially offset by a decrease in interest expense on deposits.
Current wording
Interest expense decreased by $14,000, or 3.59%, due to a decrease in interest expense on deposits, partially offset by an increase in Federal Home Loan Bank borrowing interest expense.
Previous wording
Net interest margin increased by 7 basis points, to 4.06% compared to 3.99% for the three months ended December 31, 2025 driven primarily by an increase in net interest income and a slight decrease in interest earning assets.
Current wording
Net interest margin increased by 16 basis points, to 4.22% compared to 4.06% for the three months ended March 31, 2026 driven primarily by an increase in net interest income.
Previous wording
The Company recorded an income tax expense of $20,000 for the three months ended December 31, 2025 and an income tax benefit of $1,000 for the three months ended December 31, 2024. The increase in income taxes resulted from an increase in pre-tax book income and a change in tax-exempt income. The Company’s effective income tax rates were 6.51% and (0.63)% for the three months ended December 31, 2025 and 2024, respectively. The increase in the effective income tax rate for the three months ended December 31, 2025, as compared to the three months ended December 31, 2024, was primarily related to the increase in pre-tax book income and fluctuations in permanent tax differences.
Current wording
The Company recorded an income tax expense of $4,000 for the three months ended March 31, 2026 and an income tax benefit of $16,000 for the three months ended March 31, 2025. The increase in income taxes resulted from an increase in pre-tax book income and a change in tax-exempt income. The Company’s effective income tax rates were 1.81% and (15.69)% for the three months ended March 31, 2026 and 2025, respectively. The increase in the effective income tax rate for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, was primarily related to the increase in pre-tax book income and fluctuations in permanent tax differences.
Previous wording
Management recorded credit loss provisions of $13,000 and $15,000 for the three months ended December 31, 2025 and 2024, respectively. Based on a review of the loans that were in the loan portfolio at December 31, 2025, management believes that the allowance is maintained at a level that represents its best estimate of inherent credit losses in the loan portfolio that were both probable and reasonably estimable.
Current wording
Management recorded credit loss provisions of $18,000 and $15,000 for the six months ended March 31, 2026 and 2025, respectively. Based on a review of the loans that were in the loan portfolio at March 31, 2026, management believes that the allowance is maintained at a level that represents its best estimate of inherent credit losses in the loan portfolio that were both probable and reasonably estimable.
Previous wording
The increase in total non-interest income for the three months ended December 31, 2025, was primarily due to a $103,000 gain recognized from a bank-owned life insurance death benefit. Earnings on deferred fees plan increased $29,000 for the three months ended December 31, 2025 compared to the same period last year, primarily due to fluctuations with market rates. Other non-interest income decreased $54,000 for the three months ended December 31, 2025 compared to the same period last year, primarily due to additional income from a tax-related refund recognized in the comparable period last year that did not recur this quarter.
Current wording
The increase in total non-interest income for the six months ended March 31, 2026, was primarily due to a $103,000 gain recognized from a bank-owned life insurance death benefit. Earnings on investments in life insurance increased $10,000 and earnings on deferred fees plan increased $28,000 for the six months ended March 31, 2026, compared to the same period last year, primarily due to fluctuations with market rates. Other non-interest income decreased $48,000 for the six months ended March 31, 2026, compared to the same period last year, primarily due to additional income from a tax-related refund recognized in the comparable period last year that did not recur this year.
Previous wording
The increase in total non-interest expense included a $29,000 increase in expenses on the earnings on deferred fees plan, primarily due to fluctuations with market rates. Foreclosed assets, net decreased $19,000 to a net benefit of $18,000 for the three months ended December 31, 2025, compared to net expense of $1,000 for the three months ended December 31, 2024. The change was primarily due to a favorable fair value adjustment on a foreclosed property during the three months ended December 31, 2025.
Current wording
The increase in total non-interest expense included a $47,000 increase in building, occupancy and equipment expense for the six months ended March 31, 2026 compared to the six months ended March 31, 2025. This was primarily due to higher utility costs and increased snow removal expenses during the winter season. Foreclosed assets, net decreased $25,000 to a net benefit of $24,000 for the six months ended March 31, 2026, compared to net expense of $1,000 for the six months ended March 31, 2025. The change was primarily due to a favorable fair value adjustment on a foreclosed property and the sale of a different foreclosed property during the six months ended March 31, 2026.
Previous wording
From time to time, as part of our loss mitigation strategy, we may renegotiate the loan terms based on the economic or legal reasons related to the borrower’s financial difficulties. There were no loans modified to borrowers experiencing financial difficulty during the three months ended December 31, 2025. Loans modified to borrowers experiencing financial difficulty may be considered to be non-performing and, if so, are placed on non-accrual, except for those that have established a sufficient performance history (generally a minimum of six consecutive months of performance) under the terms of the restructured loan.
Current wording
From time to time, as part of our loss mitigation strategy, we may renegotiate loan terms based on economic or legal reasons related to the borrower’s financial difficulties. There were no loans modified to borrowers experiencing financial difficulty during the six months ended March 31, 2026. Loans modified to borrowers experiencing financial difficulty may be considered to be non-performing and, if so, are placed on non-accrual, except for those that have established a sufficient performance history (generally a minimum of six consecutive months of performance) under the terms of the restructured loan.
Previous wording
The following tables set 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 $495,000 and $440,000 for the three months ended December 31, 2025 and 2024, respectively.
Current wording
The following tables set forth average balances, 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 $490,000 and $455,000 for the three and six months ended March 31, 2026 and 2025, respectively.
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 December 31, 2025, there $5.0 million in outstanding advances from the Federal Home Loan Bank, and we had the ability to borrow an additional $58.2 million. Additionally, at December 31, 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 Bankers Bank totaling $4.0 million. At December 31, 2025, 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 March 31, 2026, there $1.0 million in outstanding advances from the Federal Home Loan Bank, and we had the ability to borrow an additional $62.7 million. Additionally, at March 31, 2026, 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 Bankers Bank totaling $4.0 million. At March 31, 2026, 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 operating activities was $0.5 million and $0.3 million for the three months ended December 31, 2025 and 2024, respectively. Net cash used in investing activities, which consists primarily of disbursements for loan originations and purchases and the purchase of securities available-for-sale, offset by principal
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 $0.8 million and $(0.1) million for the six months ended March 31, 2026 and 2025, 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 $1.4 million and $0.3 million for the six months ended March 31, 2026 and 2025, respectively. Net cash (used in) provided
Previous wording
collections on loans, proceeds from sales, maturities and principal payments received on securities available-for-sale, was $3.0 million and $0.2 million for the three months ended December 31, 2025 and 2024, respectively. Net cash provided by financing activities, consisting primarily of activity in deposit accounts and Federal Home Loan Bank advances, was $2.6 million for the three months ended December 31, 2025 and was $0.5 million for the three months ended December 30, 2024.
Current wording
by financing activities, consisting primarily of activity in deposit accounts and Federal Home Loan Bank advances, was $(0.9) million for the six months ended March 31, 2026 and was $1.3 million for the six months ended March 31, 2025.
Previous wording
Gouverneur Bancorp, Inc. 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. Bancorp’s primary source of income is dividends received from the Bank. The amount of dividends that the Bank may declare and pay to Bancorp is governed by applicable bank regulations. At December 31, 2025 and September 30, 2025, Bancorp (on an unconsolidated basis) had liquid assets of $1.1 million and $1.3 million, respectively.
Current wording
Gouverneur Bancorp, Inc. 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. Bancorp’s primary source of income is dividends received from the Bank. The amount of dividends that the Bank may declare and pay to Bancorp is governed by applicable bank regulations. At March 31, 2026 and September 30, 2025, Bancorp (on an unconsolidated basis) had liquid assets of $0.8 million and $1.3 million, respectively.
Rearranged current paragraphs (10)
Current report — wording carried from elsewhere
differ from these judgments and estimates under different conditions, resulting in a change that could have a material impact on the carrying values of our assets and liabilities and our results of operations.
Current report — wording carried from elsewhere
secured by real estate, we consider the extent of any past due and unpaid property taxes applicable to the property serving as collateral on the mortgage.
Current report — wording carried from elsewhere
Management recorded a $5,000 provision for credit loss on loans, and no benefit from the provision for unfunded commitments, for the three months ended March 31, 2026, compared to a $5,000 provision for credit loss on loans, and a $5,000 benefit from the provision for unfunded commitments for the three months ended March 31, 2025. Based on a review of the loans that were in the loan portfolio at March 31, 2026, management believes that the allowance is maintained at a level that represents its best estimate of inherent credit losses in the loan portfolio that were both probable and reasonably estimable.
Current report — wording carried from elsewhere
The increase in total non-interest income for the three months ended March 31, 2026, was primarily due to a $11,000 increase in service charge income compared to the same period last year. Earnings on investments in life insurance increased $3,000 and earnings on deferred fees plan decreased $1,000 for the three months ended March 31, 2026, compared to the same period last year, primarily due to fluctuations with market rates. Other non-interest income increased $5,000 for the three months ended March 31, 2026, compared to the same period last year, primarily due to additional fee income.
Current report — wording carried from elsewhere
Results of Operations for the Six Months Ended March 31, 2026 and 2025
Current report — wording carried from elsewhere
Interest income increased by $161,000, or 3.74%, for the six months ended March 31, 2026 due to an increase in loan income from an increase in loan origination and loan repricing, partially offset by a decrease in interest on taxable securities.
Current report — wording carried from elsewhere
Net interest margin increased by 12 basis points, to 4.14% compared to 4.02% for the six months ended March 31, 2026 driven primarily by an increase in net interest income.
Current report — wording carried from elsewhere
The following table sets forth a summary of non-interest income for the periods indicated:
Current report — wording carried from elsewhere
The following table sets forth an analysis of non-interest expense for the periods indicated:
Current report — wording carried from elsewhere
The Company recorded an income tax expense of $24,000 for the six months ended March 31, 2026 and an income tax benefit of $17,000 for the six months ended March 31, 2025. The increase in income taxes resulted from an increase in pre-tax book income and a change in tax-exempt income. The Company’s effective income tax rates were 4.55% and (6.51)% for the six months ended March 31, 2026 and 2025, respectively. The increase in the effective income tax rate for the six months ended March 31, 2026, as compared to the six months ended March 31, 2025, was primarily related to the increase in pre-tax book income and fluctuations in permanent tax differences.