BROADWAY FINANCIAL CORP \DE\

Previous wording

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity and certain other factors that may affect our future results. Our MD&A should be read in conjunction with the Consolidated Financial Statements and related Notes included in Part I, Item 1 “Financial Statements,” of this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K/A for the year ended December 31, 2024, as amended (the “2024 Form 10-K”). Certain statements herein are forward-looking statements within the meaning of Section 21E of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”) and Section 27A of the U.S. Securities Act of 1933, as amended that reflect our current views with respect to future events and financial performance. Forward-looking statements typically include words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “potential,” “continue,” “prospects,” “ability,” “looking,” “forward,” “invest,” “grow,” “improve,” “likely” and other similar expressions. These forward-looking statements are subject to risks and uncertainties, which could cause actual future results to differ materially from historical results or from those anticipated or implied by such statements. Readers should not place undue reliance on these forward-looking statements, which speak only as of their dates or, if no date is provided, then as of the date of this Form 10-Q. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law. The unaudited interim consolidated financial statements for the quarter ended September 30, 2024 and consolidated financial statements for the fiscal year ended December 31, 2024 presented herein are as restated.

Current wording

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity and certain other factors that may affect our future results. Our MD&A should be read in conjunction with the Consolidated Financial Statements and related Notes included in Part I, Item 1 “Financial Statements,” of this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Form 10-K”). Certain statements herein are forward-looking statements within the meaning of Section 21E of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”) and Section 27A of the U.S. Securities Act of 1933, as amended that reflect our current views with respect to future events and financial performance. Forward-looking statements typically include words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “potential,” “continue,” “prospects,” “ability,” “looking,” “forward,” “invest,” “grow,” “improve,” “likely” and other similar expressions. These forward-looking statements are subject to risks and uncertainties, which could cause actual future results to differ materially from historical results or from those anticipated or implied by such statements. Readers should not place undue reliance on these forward-looking statements, which speak only as of their dates or, if no date is provided, then as of the date of this Form 10-Q. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law.

Previous wording

Critical accounting policies are those that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results of operations under different assumptions and conditions. This discussion highlights those accounting policies that management considers critical. All accounting policies are important; therefore, you are encouraged to review each of the policies included in Note 1 “Summary of Significant Accounting Policies” of the Notes to Consolidated Financial Statements in our 2024 Form 10-K/A to gain a better understanding of how our financial performance is measured and reported. Management has identified the Company’s critical accounting policies as follows:

Current wording

Critical accounting policies are those that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results of operations under different assumptions and conditions. This discussion highlights those accounting policies that management considers critical. All accounting policies are important; therefore, you are encouraged to review each of the policies included in Note 1 “Summary of Significant Accounting Policies” of the Notes to Consolidated Financial Statements in our 2025 Form 10-K to gain a better understanding of how our financial performance is measured and reported. Management has identified the Company’s critical accounting policies as follows:

Previous wording

The Company accounts for credit losses on loans in accordance with ASC 326, which requires the Company to record an estimate of expected lifetime credit losses for loans at the time of origination or acquisition. The ACL is maintained at a level deemed appropriate by management to provide for expected credit losses in the portfolio as of the date of the consolidated statements of financial condition. Estimating expected credit losses requires management to use relevant forward-looking information, including the use of reasonable and supportable forecasts. The measurement of the ACL is performed by collectively evaluating loans with similar risk characteristics. The Company measures the ACL for each of its loan segments using the weighted-average remaining maturity (“WARM”) method. The weighted average remaining life, including the effect of estimated prepayments, is calculated for each loan pool on a quarterly basis. The Company then estimates a loss rate for each pool using both its own historical loss experience and the historical losses of a group of peer institutions. The Company’s ACL model also includes adjustments for qualitative factors, where appropriate.

Current wording

The Company accounts for credit losses on loans in accordance with ASC 326, which requires the Company to record an estimate of expected lifetime credit losses for loans at the time of origination or acquisition. The ACL is maintained at a level deemed appropriate by management to provide for expected credit losses in the portfolio as of the date of the consolidated statements of financial condition. Estimating expected credit losses requires management to use relevant forward-looking information, including the use of reasonable and supportable forecasts. The measurement of the ACL is performed by collectively evaluating loans with similar risk characteristics.

Previous wording

The Company accounts for credit losses on loans in accordance with ASC 326 –Financial Instruments-Credit Losses. ASC 326 requires the Company to recognize estimates for lifetime losses on loans and off-balance sheet loan commitments at the time of origination or acquisition. The recognition of losses at origination or acquisition represents the Company’s best estimate of the lifetime expected credit loss associated with a loan given the facts and circumstances associated with the particular loan and involves the use of significant management judgment and estimates, which are subject to change based on management’s on-going assessment of the credit quality of the loan portfolio and changes in economic forecasts used in the model. The Company uses the WARM method when determining estimates for the ACL for each of its portfolio segments. The weighted average remaining life, including the effect of estimated prepayments, is calculated for each loan pool on a quarterly basis. The Company then estimates a loss rate for each pool using both its own historical loss experience and the historical losses of a group of peer institutions during the period from 2004 through the most recent quarter.

Current wording

Prior to March 31, 2026, the Company measured the ACL for each of its loan segments using the WARM method. The weighted average remaining life, including the effect of estimated prepayments, was calculated for each loan pool on a quarterly basis. The Company then estimated a loss rate for each pool using both its own historical loss experience and the historical losses of a group of peer institutions during the period from 2004 through the most recent quarter.

Previous wording

Loans receivable held for investment, net of the ACL, increased by $13.2 million to $1.0 billion at September 30, 2025, compared to $1.0 billion at December 31, 2024. The increase was primarily due to loan purchases. The Company has recently engaged in purchasing government guaranteed loans to complement organic loan growth.

Current wording

Loans held for investment, net of the ACL, increased by $42.7 million to $1.1 billion at March 31, 2026, compared to $1.0 billion at December 31, 2025. The increase was primarily due to loan purchases.

Previous wording

Deposits increased by $103.8 million, or 13.9%, to $849.2 million at September 30, 2025, from $745.4 million at December 31, 2024. The increase in deposits was attributable to an increase of $72.9 million in certificates of deposit accounts, $26.8 million in liquid deposits (demand, interest checking, and money market accounts), $8.0 million in Insured Cash Sweep (“ICS”) deposits and $4.0 million in Certificate of Deposit Registry Service (“CDARS”) deposits, partially offset by a $7.9 million decrease in savings deposits. As of September 30, 2025, our uninsured deposits, including deposits from the Bank and other affiliates, represented 36% of our total deposits, compared to 32% as of December 31, 2024.

Current wording

Deposits increased by $155.5 million, or 16.9%, to $1.1 billion at March 31, 2026, from $917.6 million at December 31, 2025, due to participation in an online financial platform that serves as a marketplace for high-yield savings and CD accounts. The increase in deposits was attributable to increases of $198.1 million in savings deposits and $11.1 million in certificates of deposit accounts, partially offset by decreases of $48.5 million in liquid deposits (demand, interest checking, and money market accounts), $4.8 million in Insured Cash Sweep (“ICS”) deposits (ICS deposits are the Bank’s money market deposit accounts in excess of Federal Deposit Insurance Corporation (“FDIC”) insured limits whereby the Bank makes reciprocal arrangements for insurance with other banks), and $319 thousand in Certificate of Deposit Registry Service (“CDARS”) deposits (CDARS deposits are similar to ICS deposits, but involve certificates of deposit, instead of money market accounts).

Previous wording

For the first nine months of 2025, the Company reported consolidated net loss attributable to common stockholders of $28.1 million after preferred dividends of $2.3 million and goodwill impairment of $25.9 million, compared to net loss attributable to common stockholders of $199 thousand for the first nine months of 2024 after preferred dividends of $817 thousand. Diluted loss per common share was ($3.76) for the first nine months of 2025, compared to ($0.02) of loss per diluted common share for the first nine months of 2024. Consolidated net income before preferred dividends and goodwill impairment was $38 thousand, or $0.01 per diluted share, compared to consolidated net income before preferred dividends of $618 thousand, or $0.07 per diluted share, for the first nine months of 2024. Diluted loss per common share for the first nine months of 2025 reflects preferred dividends of ($0.30) per diluted common share and goodwill impairment of ($3.46) per diluted common share.

Current wording

Net income attributable to common stockholders increased to $409 thousand, or $0.05 per diluted share, during the first quarter of 2026 after deducting preferred dividends of $750 thousand, compared to net loss attributable to common stockholders of $3.4 million, or ($0.39) per diluted share, for the first quarter of 2025 after deducting preferred dividends of $750 thousand. Diluted income per common share was $0.05 for the first quarter of 2026, compared to ($0.39) of loss per diluted common share for the first quarter of 2025. Diluted income per common share for both the first quarter of 2026 and the first quarter of 2025 reflects preferred dividends of $0.09 per diluted common share.

Previous wording

For the third quarter of 2025, the Company reported consolidated net loss attributable to common stockholders of $24.6 million after preferred dividends of $750 thousand and goodwill impairment of $25.9 million, compared to net loss attributable to common stockholders of $234 thousand for the third quarter of 2024 after preferred dividends of $750 thousand. Loss per diluted common share was ($3.23) for the third quarter of 2025, compared to ($0.03) of loss per diluted common share for the third quarter of 2024. Consolidated net income before preferred dividends and goodwill impairment was $2.0 million, or $0.26 per diluted share, for the third quarter of 2025, compared to consolidated net income of $516 thousand, or $0.06 per diluted share, for the third quarter of 2024. Diluted loss per common share for the third quarter of 2025 reflects preferred dividends of ($0.10) per diluted common share and goodwill impairment of ($3.39) per diluted common share. “Net income before preferred dividends and goodwill impairment” and “Earnings per common share – diluted before preferred dividends and goodwill impairment” are considered to be non-GAAP measures. See “Use of Non-GAAP Financial Measures” section of this Form 10-Q for a reconciliation of these amounts to the associated GAAP financial measure.

Current wording

For the three months ended March 31, 2026, the Company reported consolidated net income before preferred dividends of $1.2 million, or $0.13 per diluted share, compared to consolidated net loss before preferred dividends of $2.7 million, or ($0.31) per diluted share, for the first quarter of 2025, representing an improvement of $3.9 million.“Net income before preferred dividends” and “Earnings per common share – diluted before preferred dividends” are considered to be non-GAAP measures. See “Use of Non-GAAP Financial Measures” section of this Form 10-Q for a reconciliation of these amounts to the associated GAAP financial measure.

Previous wording

Net interest income before provision for credit losses for the third quarter of 2025 totaled $8.6 million, representing an increase of $287 thousand, or 3.4%, from net interest income before provision for credit losses of $8.3 million for the third quarter of 2024. The increase resulted froma $3.3 million decrease in interest expense due to a decline in interest on borrowings as a result of a decrease in the average balance of borrowings, partially offset by a $2.2 million increase in interest expense on deposits due to an increase in the average balance of deposits, partially offset by an $818 thousand decline in interest income on interest-bearing deposits. The Company used interest-bearing deposits and cash from principal pay downs of available-for-sale securities to reduce borrowings to improve the net interest margin and to support capacity for future loan growth.

Current wording

Net interest income totaled $9.1 million, representing an increase of $1.0 million, or 12.5%, from net interest income of $8.0 million for the first quarter of 2025. The increase resulted froma $1.4 million increase in interest income, due to a $1.4 million increase in interest income on available-for-sale securities due to an increase in the average balance of available-for-sale securities and the average rate earned on available-for-sale securities. Further, interest expense on borrowings decreased $1.4 million due to a decrease in the average balance of borrowings. These increases in net interest income were partially offset by a $1.8 million increase in interest expense on deposits due to an increase in the average balance of deposits and the average rate paid on deposits.

Previous wording

The net interest margin increased to 2.72% for the third quarter of 2025 from 2.43% for the third quarter of 2024, due to an increase in the average rate earned on interest-earning assets, which increased to 4.99% for the third quarter of 2025 from 4.84% for the third quarter of 2024, and a decrease in the cost of funds, which decreased to 3.11% for the third quarter of 2025 from 3.30% for the third quarter of 2024.

Current wording

The net interest margin increased to 2.75% for the first quarter of 2026 from 2.63% for the first quarter of 2025, due to an increase in the average rate earned on interest-earning assets, which increased to 4.93% for the first quarter of 2026 from 4.84% for the first quarter of 2025, and a decrease in the cost of funds, which decreased to 2.91% for the first quarter of 2026 from 3.06% for the first quarter of 2025.

Previous wording

The following tables set forth the average balances, average yields and costs, and certain other information for the periods indicated. All average balances are daily average balances. The yields set forth below include the effect of deferred loan fees, and discounts and premiums that are amortized or accreted to interest income or expense. We do not accrue interest on loans on non-accrual status, but the balance of these loans is included in the total average balance of loans receivable, which has the effect of reducing average loan yields.

Current wording

The following tables set forth the average balances, average yields and costs, and certain other information for the periods indicated. All average balances are daily average balances. The yields set forth below include the effect of deferred loan fees, deferred origination costs, and discounts and premiums that are amortized or accreted to interest income or expense. We do not accrue interest on loans that are on non-accrual status; however, the balance of these loans is included in the total average balance of loans receivable, which has the effect of reducing average loan yields.

Previous wording

The Company had seven non-accrual loans at September 30, 2025 with an unpaid principal balance of $13.5 million. Credit quality remains strong with non-accrual loans as a percentage of total loans at 1.33% and non-performing assets to total assets of 1.01% despite the increase in non-accrual loans.

Current wording

The Company had six non-accrual loans at March 31, 2026 with an unpaid principal balance of $11.5 million. Credit quality remains strong with non-accrual loans as a percentage of total loans at 1.07% and non-performing assets to total assets of 0.80%.

Previous wording

The Company recorded an income tax expense of $736 thousand for the third quarter of 2025, compared to an income tax expense of $206 thousand for the third quarter of 2024. The increase in income tax expense reflected an increase in pre-tax income of $2.0 million between the two periods, excluding goodwill impairment of $25.9 million, which is not deductible for tax purposes.

Current wording

The Company recorded income tax expense of $282 thousand for the first quarter of 2026, compared to an income tax benefit of $1.1 million for the first quarter of 2025. The increase in income tax expense reflected an increase in pre-tax income of $5.2 million between the two periods. The effective tax rate was 19.76% for the first quarter of 2026, compared to 28.75% for the first quarter of 2025.

Previous wording

Securities available-for-sale totaled $244.0 million at September 30, 2025, compared to $203.9 million at December 31, 2024. The $40.1 million increase in securities available-for-sale during the nine months ended September 30, 2025 was primarily due to securities purchases.

Current wording

Securities available-for-sale totaled $284.1 million at March 31, 2026, compared to $256.8 million at December 31, 2025. The $27.3 million increase in securities available-for-sale during the three months ended March 31, 2026 was primarily due to securities purchases.

Previous wording

Loans receivable held for investment, net of the ACL, increased by $13.2 million to $1.0 billion at September 30, 2025, compared to $1.0 billion at December 31, 2024. The increase was primarily due to loan purchases.

Current wording

Loans receivable held for investment, net of the ACL, increased by $42.7 million to $1.1 billion at March 31, 2026, compared to $1.0 billion at December 31, 2025. The increase was primarily due to loan purchases.

Previous wording

Certain multi-family loans have adjustable-rate features based on the Secured Overnight Financing Rate but are fixed for the first five years. Our experience has shown that these loans typically pay off during the first five years and do not reach the adjustable-rate phase. However, in the current high interest rate environment, we have seen more borrowers maintain their loans instead of paying them off due to interest rate caps which make the adjusted interest rate on their existing loan more desirable than getting a new loan at current interest rates. Multi-family loans in their initial fixed period totaled $431.0 million or 71.4% of our loan portfolio as of September 30, 2025.

Current wording

Certain multi-family loans have adjustable-rate features based on the Secured Overnight Financing Rate but are fixed for the first five years. Our experience has shown that these loans typically pay off during the first five years and do not reach the adjustable-rate phase. However, in the current high interest rate environment, we have seen more borrowers maintain their loans instead of paying them off due to interest rate caps which make the adjusted interest rate on their existing loan more desirable than getting a new loan at current interest rates. Multi-family loans in their initial fixed period totaled $408.4 million or 69.7% of our multi-family loan portfolio as of March 31, 2026.

Previous wording

Loans delinquent by 30 days or more, but less than 59 days, increased to $1.2 million at September 30, 2025, from $0 at December 31, 2024 and loan delinquencies for 60 days or more, but less than 90 days, decreased to $0 at September 30, 2025, from $270 thousand at December 31, 2024. Loans past due greater than 90 days was $426 thousand at September 30, 2025, compared to $0 at December 31, 2024.

Current wording

Loans delinquent by 30 days or more, but less than 60 days, increased to $17.5 million at March 31, 2026, from $11.8 million at December 31, 2025, primarily due to one CRE loan and one construction loan, and loan delinquencies for 60 days or more, but less than 90 days, increased to $19.1 million at March 31, 2026, from $367 thousand at December 31, 2025, primarily due to one construction loan. Loans past due greater than 90 days were $11.5 million at March 31, 2026, compared to $3.0 million at December 31, 2025.

Previous wording

We believe that the ACL is adequate to cover currently expected losses in the loan portfolio as of September 30, 2025, but there can be no assurance that actual losses will not exceed the estimated amounts. The OCC and the Federal Deposit Insurance Corporation (“FDIC”) periodically review the ACL as an integral part of their examination process. These agencies may require an increase in the ACL based on their judgments of the information available to them at the time of their examinations.

Current wording

We believe the ACL is adequate to cover expected losses in the loan portfolio as of March 31, 2026, but there can be no assurance that actual losses will not exceed the estimated amounts. The OCC and the Federal Deposit Insurance Corporation (“FDIC”) periodically review the ACL as an integral part of their examination process. These agencies may require an increase in the ACL based on their judgments of the information available to them at the time of their examinations.

Previous wording

Total liabilities increased by $24.0 million to $1.1 billion at September 30, 2025 from December 31, 2024, primarily due to an increase of $103.8 million in deposits, partially offset by an $88.0 million decrease in FHLB borrowings.

Current wording

Total liabilities increased by $80.8 million to $1.2 billion at March 31, 2026 from December 31, 2025, primarily due to an increase of $155.5 million in deposits, partially offset by a $72.0 million decrease in FHLB borrowings.

Previous wording

Deposits increased by $103.8 million, or 13.9%, to $849.2 million at September 30, 2025, from $745.4 million at December 31, 2024. The increase in deposits was attributable to an increase of $72.9 million in certificates of deposit accounts, $26.8 million in liquid deposits (demand, interest checking, and money market accounts), $8.0 million in Insured Cash Sweep (“ICS”) deposits and $4.0 million in Certificate of Deposit Registry Service (“CDARS”) deposits, partially offset by a $7.9 million decrease in savings deposits. As of September 30, 2025, our uninsured deposits, including deposits from the Bank and other affiliates, represented 36% of our total deposits, compared to 32% as of December 31, 2024.

Current wording

Deposits increased by $155.5 million, or 16.9%, to $1.1 billion at March 31, 2026, from $917.6 million at December 31, 2025. The increase in deposits was attributable to increases of $198.1 million in savings deposits and $11.1 million in certificates of deposit accounts, partially offset by decreases of $48.5 million in liquid deposits (demand, interest checking, and money market accounts), $4.8 million in ICS deposits, and $319 thousand in CDARS deposits. As of March 31, 2026, our uninsured deposits, including deposits from the Bank and other affiliates, represented 46% of our total deposits, compared to 41% as of December 31, 2025.

Previous wording

The Company enters into agreements under which it sells securities subject to an obligation to repurchase the same or similar securities. Under these arrangements, the Company may transfer legal control over the assets but still retain effective control through an agreement that both entitles and obligates the Company to repurchase the assets. As a result, these repurchase agreements are accounted for as collateralized financing agreements (i.e., secured borrowings) and not as a sale and subsequent repurchase of securities. The obligation to repurchase the securities is reflected as a liability in the Company’s consolidated statements of financial condition, while the securities underlying the repurchase agreements remain in the respective investment securities asset accounts. In other words, there is no offsetting or netting of the investment securities assets with the repurchase agreement liabilities. These agreements mature on a daily basis. As of September 30, 2025 securities sold under agreements to repurchase totaled $76.1 million at an average rate of 3.70%. The fair value of securities pledged for repurchase agreements totaled $77.7 million as of September 30, 2025. As of December 31, 2024, securities sold under agreements to repurchase totaled $66.6 million at an average rate of 3.62%. The fair value of securities pledged for repurchase agreements totaled $83.3 million as of December 31, 2024. One relationship accounted for 76% of our balance of securities sold under agreements to repurchase as of September 30, 2025. We expect to maintain this relationship for the foreseeable future.

Current wording

The Bank enters into agreements under which it sells securities subject to an obligation to repurchase the same or similar securities. Under these arrangements, the Bank may transfer legal control over the assets but still retain effective control through an agreement that both entitles and obligates the Bank to repurchase the assets. As a result, these repurchase agreements are accounted for as collateralized financing agreements (i.e., secured borrowings) and not as a sale and subsequent repurchase of securities. The obligation to repurchase the securities is reflected as a liability in the Company’s consolidated statements of financial condition, while the securities underlying the repurchase agreements remain in the respective investment securities asset accounts. In other words, there is no offsetting or netting of the investment securities assets with the repurchase agreement liabilities. These agreements mature on a daily basis. As of March 31, 2026, securities sold under agreements to repurchase totaled $81.2 million at an average rate of 3.67%. The fair value of securities pledged for repurchase agreements totaled $83.0 million as of March 31, 2026. As of December 31, 2025, securities sold under agreements to repurchase totaled $80.8 million at an average rate of 3.66%. The fair value of securities pledged for repurchase agreements totaled $83.7 million as of December 31, 2025. One customer relationship accounted for 92% of our balance of securities sold under agreements to repurchase as of March 31, 2026. We expect to maintain this relationship for the foreseeable future.

Previous wording

At September 30, 2025 and December 31, 2024, the Company had outstanding advances from the FHLB totaling $107.5 million and $195.5 million, respectively. The weighted average interest rate was 4.53% and 4.03% as of September 30, 2025 and December 31, 2024, respectively. The weighted average contractual maturity was less than one month as of both September 30, 2025 and December 31, 2024. The advances were collateralized by loans with an unpaid balance of $497.6 million at September 30, 2025 and $521.7 million at December 31, 2024. The Company is currently approved by the FHLB of Atlanta to borrow up to 25% of total assets to the extent the Company provides qualifying collateral and holds sufficient FHLB stock. Based on collateral pledged and FHLB stock held, the Company was eligible to borrow an additional $213.0 million as of September 30, 2025.

Current wording

At December 31, 2025, the Company had outstanding advances from the FHLB totaling $72.0 million. There were no advances from the FHLB outstanding as of March 31, 2026. The weighted average interest rate was 3.79% as of December 31, 2025. The weighted average contractual maturity was less than one month as of December 31, 2025. Loans with unpaid balances of $443.1 million and $448.6 million at March 31, 2026 and December 31, 2025, respectively, were pledged to secure FHLB advances. The Company is currently approved by the FHLB of Atlanta to borrow up to 25% of total assets to the extent the Company provides qualifying collateral and holds sufficient FHLB stock. Based on collateral pledged and FHLB stock held, the Company was eligible to borrow $246.0 million as of March 31, 2026.

Previous wording

Broadway Financial Corporation and subsidiary equity was $261.7 million, or 19.6%, of the Company’s total assets, at September 30, 2025, compared to $285.0 million, or 21.3% of the Company’s total assets, at December 31, 2024. Book value per share was $12.17 at September 30, 2025 and $14.80 at December 31, 2024. Capital ratios remain strong with a Community Bank Leverage Ratio of 14.56% at September 30, 2025 compared to 13.61% at December 31, 2024.

Current wording

Broadway Financial Corporation and subsidiary equity was $262.5 million, or 18.4%, of the Company’s total assets, at March 31, 2026, compared to $262.8 million, or 19.5% of the Company’s total assets, at December 31, 2025. Book value per share was $12.10 at March 31, 2026 and $12.28 at December 31, 2025. Capital ratios remain strong with a Community Bank Leverage Ratio of 14.06% at March 31, 2026 and 14.09% at December 31, 2025.

Previous wording

On March 24, 2025, the Company issued 88,295 shares of restricted stock to its officers and employees under the Amended and Restated LTIP. Each restricted stock award was valued based on the fair value of the stock on the date of the award. All the shares issued to officers and employees vest over periods ranging from 36 months to 60 months.

Current wording

In March 2025, the Company issued 88,295 shares of restricted stock to its officers and employees under the Amended and Restated LTIP. Each restricted stock award was valued based on the fair value of the stock on the date of the award. All the shares issued to officers and employees vest over periods ranging from 36 months to 60 months.

Previous wording

During May of 2024 and March of 2025, the Company issued 19,832 and 23,232 shares of stock, respectively, to its directors under the Amended and Restated LTIP, which were fully vested.

Current wording

In March 2025, the Company awarded 23,232 shares of common stock to its directors under the LTIP, which are fully vested.

Previous wording

On May 28, 2025, the Company issued 8,183 shares of restricted stock to an officer under the Amended and Restated LTIP.

Current wording

In May 2025, the Company issued 8,183 shares of restricted stock to an officer under the Amended and Restated LTIP.

Previous wording

On April 5, 2024, the Company issued 31,645 shares of restricted stock to an officer under the Amended and Restated LTIP.

Current wording

In February 2026, the Company issued 4,936 shares of restricted stock to an officer under the Amended and Restated LTIP.

Previous wording

On March 26, 2024, the Company issued 94,413 shares of restricted stock to its officers and employees under the Amended and Restated LTIP. Each restricted stock award was valued based on the fair value of the stock on the date of the award. All the shares issued to officers and employees vest over periods ranging from 36 months to 60 months.

Current wording

In March 2026, the Company issued 97,298 shares of restricted stock to its officers and employees under the Amended and Restated LTIP. Each restricted stock award was valued based on the fair value of the stock on the date of the award. All the shares issued to officers and employees vest over periods ranging from 36 months to 48 months.

Previous wording

The objective of liquidity management is to ensure that we have the continuing ability to fund operations and meet our obligations on a timely and cost-effective basis. The Bank’s sources of funds include deposits, advances from the FHLB and other borrowings, proceeds from the sale of loans and investment securities, and payments of principal and interest on loans and investment securities. The Bank is currently approved by the FHLB of Atlanta to borrow up to 25% of total assets to the extent the Bank provides qualifying collateral and holds sufficient FHLB stock. Based on FHLB stock held and collateral pledged as of September 30, 2025, the Bank had the ability to borrow an additional $213.0 million from the FHLB of Atlanta. In addition, the Bank had additional lines of credit of $10.0 million with other financial institutions as of September 30, 2025.

Current wording

The objective of liquidity management is to ensure that we have the continuing ability to fund operations and meet our obligations on a timely and cost-effective basis. The Bank’s sources of funds include deposits, advances from the FHLB and other borrowings, proceeds from the sale of loans and investment securities, and payments of principal and interest on loans and investment securities. The Bank is currently approved by the FHLB of Atlanta to borrow up to 25% of total assets to the extent the Bank provides qualifying collateral and holds sufficient FHLB stock. Based on FHLB stock held and collateral pledged as of March 31, 2026, the Bank had the ability to borrow $246.0 million from the FHLB of Atlanta. In addition, the Bank had additional lines of credit of $10.0 million with other financial institutions as of March 31, 2026.

Previous wording

The Bank’s primary uses of funds include originations of loans, withdrawals of and interest payments on deposits, purchases of investment securities, and the payment of operating expenses. Also, when the Bank has more funds than required for reserve requirements or short-term liquidity needs, the Bank invests in federal funds with the Federal Reserve Bank or in money market accounts with other financial institutions. The Bank’s liquid assets at September 30, 2025 consisted of $19.7 million in cash and cash equivalents and $154.2 million in securities available-for-sale that were not pledged, compared to $61.4 million in cash and cash equivalents and $17.6 million in securities available-for-sale that were not pledged at December 31, 2024. Currently, we believe the Bank has sufficient liquidity to support growth over the next twelve months and in the longer term.

Current wording

The Bank’s primary uses of funds include originations of loans, withdrawals of and interest payments on deposits, purchases of investment securities, and the payment of operating expenses. Also, when the Bank has more funds than required for reserve requirements or short-term liquidity needs, the Bank invests excess cash with the Federal Reserve Bank or other financial institutions. The Bank’s liquid assets at March 31, 2026 consisted of $26.6 million in cash and cash equivalents and $189.4 million in securities available-for-sale that were not pledged, compared to $10.5 million in cash and cash equivalents and $161.1 million in securities available-for-sale that were not pledged at December 31, 2025. Currently, we believe the Bank has sufficient liquidity to support growth over the next twelve months and in the longer term.

Previous wording

The Bank had commitments to fund $25.2 million in loans that were approved but unfunded as of September 30, 2025. In addition, the bank had $3.1 million in unfunded line of credit loans and $27.4 million in unfunded construction loans as of September 30, 2025.

Current wording

The Bank had commitments to fund $17.7 million in loans that were approved but unfunded as of March 31, 2026. In addition, the Bank had $3.1 million in unfunded line of credit loans and $22.0 million in unfunded construction loans as of March 31, 2026.

Previous wording

The Bank has a significant concentration of deposits with five customers that accounted for approximately 23% of its deposits as of September 30, 2025. The Bank also has a significant concentration of short-term borrowings with one customer that accounted for 76% of the outstanding balance of securities sold under agreements to repurchase as of September 30, 2025. The Bank has long-term relationships with these customers and expects to maintain its relationships with them for the foreseeable future.

Current wording

The Bank has a significant concentration of deposits with five customers that accounted for approximately 40% of its deposits as of March 31, 2026. The Bank also has a significant concentration of short-term borrowings with one customer that accounted for 92% of the outstanding balance of securities sold under agreements to repurchase as of March 31, 2026. The Bank has long-term relationships with these customers and expects to maintain its relationships with them for the foreseeable future.

Previous wording

The Company’s liquidity, separate from the Bank, is based primarily on the proceeds from financing transactions, such as the private placement completed in June of 2022 and previous private placements. The Bank is currently under no prohibition from paying dividends to the Company but is subject to restrictions as to the amount of the dividends based on normal regulatory guidelines.

Current wording

The Company’s liquidity, separate from the Bank, is based primarily on the proceeds from financing transactions, such as the preferred stock sold to the U.S. Treasury in 2022 and the previous private placements completed in December 2016 and April 2021, and dividends received from the Bank in 2024 and 2025. The Bank is currently under no prohibition from paying dividends to the Company but is subject to restrictions as to the amount of the dividends based on normal regulatory guidelines.

Previous wording

The Company recorded consolidated net cash outflows from investing activities of $66.0 million during the nine months ended September 30, 2025, compared to net cash outflows from investing activities of $3.3 million during the nine months ended September 30, 2024. Net cash outflows from investing activities for the nine months ended September 30, 2025 were primarily due to purchases of available-for-sale securities of $117.9 million, purchases of bank owned life insurance of $20.0 million and funding of new loans, net of repayments, of $15.5 million, partially offset by $84.0 million in proceeds from principal paydowns on available-for-sale securities. Net cash outflows from investing activities during the nine months ended September 30, 2024 were primarily due to funding of new loans, net of repayments, of $88.1 million, partially offset by $85.1 million in proceeds from principal paydowns on available-for-sale securities.

Current wording

The Company recorded consolidated net cash outflows from investing activities of $68.2 million during the three months ended March 31, 2026, compared to net cash inflows from investing activities of $31.8 million during the three months ended March 31, 2025. Net cash outflows from investing activities for the three months ended March 31, 2026 were primarily due to purchases of available-for-sale securities of $46.9 million and funding of new loans, net of repayments, of $43.0 million, partially offset by $18.3 million of principal payments on available-for sale-securities. Net cash inflows from investing activities for the three months ended March 31, 2025 were primarily due to principal paydowns on available-for-sale securities of $20.4 million and proceeds from the redemption of FHLB stock of $7.7 million.

Previous wording

The Company recorded consolidated net cash inflows from financing activities of $21.8 million during the nine months ended September 30, 2025, compared to consolidated net cash outflows from financing activities of $9.1 million during the nine months ended September 30, 2024. Net cash inflows from financing activities during the nine months ended September 30, 2025 were primarily due to proceeds of FHLB borrowings of $549.5 million and a net increase in deposits of $103.8 million, partially offset by repayments of FHLB borrowings of $637.5 million. Net cash outflows from financing activities during the nine months ended September 30, 2024 were primarily attributable to proceeds from FHLB borrowings of $178.4 million, partially offset by the repayment of FHLB borrowings of $176.7 million and the repayment of a note of $14.0 million.

Current wording

The Company recorded consolidated net cash inflows from financing activities of $83.2 million during the three months ended March 31, 2026, compared to consolidated net cash outflows from financing activities of $73.1 million during the three months ended March 31, 2025. Net cash inflows from financing activities during the three months ended March 31, 2026 were primarily due to proceeds of FHLB borrowings of $183.3 million and a net increase in deposits of $155.5 million, partially offset by repayments of FHLB borrowings of $255.3 million. Net cash outflows from financing activities during the three months ended March 31, 2025 were primarily due to repayments of FHLB advances of $294.0 million, partially offset by proceeds from FHLB advances of $176.5 million, a net increase in deposits of $31.1 million and a $14.2 million net increase in securities sold under agreements to repurchase.

Previous wording

Management uses non-GAAP measures because they provide information to investors about the underlying operational performance and trends of the Company. These disclosures should not be considered in isolation or as a substitute for results determined in accordance with GAAP and are not necessarily comparable to non-GAAP performance measures which may be presented by other bank holding companies. Management compensates for these limitations by providing detailed reconciliations between GAAP information and the non-GAAP financial measures. The tables below reconciles the GAAP financial measures to the associated non-GAAP financial measures.

Current wording

Management uses non-GAAP measures because they provide information to investors about the underlying operational performance and trends of the Company. These disclosures should not be considered in isolation or as a substitute for results determined in accordance with GAAP and are not necessarily comparable to non-GAAP performance measures which may be presented by other bank holding companies. Management compensates for these limitations by providing detailed reconciliations between GAAP information and the non-GAAP financial measures. The tables below reconcile the GAAP financial measures to the associated non-GAAP financial measures.

Previous wording

The Company calculates net income before preferred dividends and goodwill impairment by adding preferred stock dividends and goodwill impairment to net loss available to common shareholders. Earnings per common share - diluted before preferred dividends and goodwill impairment is calculated by dividing net income before preferred dividends and goodwill impairment by the weighted average common shares outstanding for diluted earnings per common share. The Company considers this information important to shareholders because it illustrates net income and earnings per common share - diluted excluding the impact of preferred dividends and goodwill impairment.

Current wording

The Company calculates net income (loss) before preferred dividends by adding preferred stock dividends to net income (loss) available to common shareholders. Earnings (loss) per common share - diluted before preferred dividends is calculated by dividing net income (loss) before preferred dividends by the weighted average common shares outstanding for diluted earnings (loss) per common share. The Company considers this information important to shareholders because it illustrates net income and earnings per common share - diluted excluding the impact of preferred dividends.