Winchester Bancorp, Inc./MD/

NATURE OF OPERATIONS

Reorganization

On December 4, 2024, The Board of Trustees of Winchester Savings Bank (the "Bank") adopted a plan of reorganization from a Mutual Savings Bank to a Mutual Holding Company and Plan of Stock Issuance (the "Plan"). The Plan received the required approvals of various regulatory agencies. The Bank’s reorganization and the related stock offering of Winchester Bancorp, Inc. (the "Company") were consummated on April 30, 2025. The Company sold 3,997,012 shares of common stock at $10.00 per share for gross proceeds of $39,970,000. In connection with the reorganization, the Company also issued 5,112,457 shares of common stock to Winchester Bancorp, MHC, the Company’s mutual holding company parent, and issued 185,907 shares of common stock to the Winchester Savings Bank Charitable Foundation, Inc.

A liquidation account by Winchester Bancorp, Inc. for the benefit of eligible account holders has been set up in an amount equal to the percentage of the shares of common stock issued in the offering to persons other than Winchester Bancorp, MHC multiplied by the net worth of Winchester Savings Bank as of September 30, 2024.

In the unlikely event of a complete liquidation of (i) Winchester Savings Bank or (ii) Winchester Savings Bank and Winchester Bancorp, Inc., all claims of creditors, including those of depositors, will be paid first. However, except with respect to the liquidation account to be established, a depositor’s claim would be solely for the principal amount of his or her deposit accounts plus accrued interest. Depositors generally would not have an interest in the value of the assets of Winchester Savings Bank or Winchester Bancorp, Inc. above that amount.

After two years from the date of the offering and upon the written request of the Federal Reserve Board and, if necessary, the FDIC and the Massachusetts Commissioner of Banks, Winchester Bancorp, Inc. will transfer the liquidation account and the depositors’ interests in such account to Winchester Savings Bank.

Each eligible account holder would have an initial pro-rata interest in the liquidation account for each deposit account, including savings accounts, transaction accounts such as negotiable order of withdrawal accounts, money market deposit accounts, and certificates of deposit, with a balance of $50 or more held in Winchester Savings Bank as of the close of business on November 30, 2023 equal to the proportion that the balance of such account holder’s deposit account as of the close of business on November 30, 2023 bears to the balance of all deposit accounts of all eligible account holders in Winchester Savings Bank on such dates.

If, however, on any June 30 annual closing date, the amount in any such deposit account is less than the amount in the deposit account as of the close of business on November 30, 2023, or any other annual closing date, then the liquidation account as well as the interest in the liquidation account relating to such deposit account would be reduced from time to time by the proportion of any such reduction, and such interest will cease to exist if such deposit account is closed. In addition, no interest in the liquidation account would ever be increased despite any subsequent increase in the related deposit account. Payment pursuant to liquidation rights of eligible account holders would be separate and apart from the payment of any insured deposit accounts to such depositor. Any assets remaining after the above liquidation rights of eligible account holders are satisfied would be available for distribution to stockholders.

The Bank may not declare or pay a cash dividend on its outstanding capital stock if the effect thereof would cause its regulatory capital to be reduced below the amount required to maintain the Liquidation Account and under FDIC rules and regulations.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying audited consolidated financial statements of Winchester Bancorp, Inc, have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) for interim information. Accordingly, they do not include all the information and footnote disclosures required by GAAP for complete financial statements. In the opinion of management, all normal recurring adjustments necessary for a fair presentation of the financial condition and result of operations for the periods have been included.

Certain previously reported amounts have been reclassified to conform with current period's presentation.

Basis of consolidation and presentation

The consolidated financial statements include the accounts of the Company, the Bank and the Bank's wholly owned subsidiaries, Sachem Holdings, Inc., Aberjona Holdings, Inc., 1871 Company, LLC, and Wedgemere Holdings, LLC. Sachem Holdings, Inc. and Aberjona Holdings, Inc. function as Massachusetts security corporations that buy, sell and hold securities. 1871 Company, LLC's principal activity is holding of bank premises.

Wedgemere Holdings, LLC's principal activity is the holding of properties acquired in settlement of loans. All significant intercompany balances and transactions have been eliminated in consolidation.

Business

The Company is a Maryland corporation whose primarily purpose is to act as the holding company for the Bank. The Bank provides a variety of financial services to individuals and small businesses through its offices in Winchester, Woburn, Danvers and Arlington, Massachusetts. Its primary deposit products are checking, savings and term certificate accounts and its primary lending products are residential, commercial and multi-family real estate and construction loans.

Use of estimates

In preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated balance sheet and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for credit losses and post-retirement benefit liabilities.

Fair value hierarchy

The Company groups its assets and liabilities measured at fair value in three levels, based on the markets in which the assets are traded and the reliability of the assumptions used to determine fair value.

Level 1 – Valuation is based on quoted prices in active markets for identical assets. Valuations are obtained from readily available pricing sources for market transactions involving identical assets.

Level 2 – Valuation is based on observable inputs other than Level 1 prices, such as quoted prices for similar assets; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets.

Level 3 – Valuation is based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets. Level 3 assets include financial instruments whose value is determined using unobservable inputs to pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

Defined benefit pension plan investments in hedge funds are measured using the net asset value per share (or its equivalent) as a practical expedient and have not been classified in the fair value hierarchy.

Cash and cash equivalents

For purposes of the consolidated statements of cash flows, cash and cash equivalents include cash and balances due from banks, interest-bearing deposits and federal funds sold which mature within ninety days. The Bank may from time to time have deposits in financial institutions which exceed the federally insured limits. At June 30, 2025 and 2024, the Bank had cash on deposit at the Federal Reserve Bank amounting to $47,016,000 and $40,929,000, respectively.

Securities

Debt securities that management has the positive intent and ability to hold to maturity are classified as “held to maturity” and recorded at amortized cost. Debt securities not classified as held to maturity are classified as “available for sale” and recorded at fair value, with unrealized gains and losses excluded from earnings and reported in other comprehensive income (loss), net of tax effects.

Marketable equity securities are measured at fair value with changes in fair value reported on the Company’s consolidated statements of operations as a component of other non-interest income, regardless of whether such gains and losses are realized.

Purchase premiums and discounts are amortized to income using the interest method over the terms of the securities, with the exception of callable debt securities, whose premiums are amortized to the earliest call date. Gains and losses on securities available for sale are recorded on the trade date and are determined using the specific identification method.

Each reporting period, the Bank evaluates all securities available for sale with a decline in fair value below the amortized cost of the investment, to determine whether an allowance for credit losses should be recorded. The Bank first assesses if there’s intent to sell, or if it more likely than not the Bank will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through a provision for credit losses charged to earnings. For debt securities available for sale that the Bank intends to hold, management evaluates whether the decline in fair value has resulted from credit losses or other factors. The Bank considers both qualitative and quantitative factors in making this assessment. Credit loss is measured based on discounted cash flow analysis and recorded in a valuation allowance. The allowance is limited by the amount that the fair value is less than the amortized cost basis. Impairment that has not been recorded through an allowance for credit losses is recorded through other comprehensive income, net of applicable taxes. Changes in allowance are recorded in the period of the change as a credit loss expense (or reversal of the credit loss expense).

The Bank measures expected credit losses on held to maturity securities on a collective basis by major security type in accordance with the Current Expected Credit Loss ("CECL") methodology and any credit losses are recognized as part of an allowance for credit losses.

Debt securities are placed on nonaccrual status at the time any principal of interest payments become 90 days delinquent. Interest accrued but not received for a security placed on nonaccrual is reversed against interest income.

Dividends are recorded in income when declared. Gains and losses on the sale of marketable equity securities are recorded on the trade date and are determined using the specific identification method.

Federal Home Loan Bank Stock

The Bank, as a member of the Federal Home Loan Bank (the “FHLB”) system, is required to maintain an investment in capital stock of the FHLB of Boston. Based on the redemption provisions of the FHLB, the stock has no quoted market value and is carried at cost. At its discretion, the FHLB may declare dividends on the stock. The Bank reviews the stock for impairment based on the likelihood of the ultimate recoverability of the cost basis in the FHLB stock. As of June 30, 2025 and 2024, no impairment has been recognized.

Accrued Interest Receivable

The Bank elected not to measure an allowance for credit losses for accrued interest receivable and instead elected to reverse interest income on loans or securities that are placed on nonaccrual status, which is generally when the instrument is

90 days past due, or earlier if the Bank believes the collection of interest is doubtful. The Bank has concluded that this policy results in the timely reversal of uncollectible interest.

Loans

The Bank’s loan portfolio includes residential real estate, commercial and multi-family real estate, construction, home equity and lines of credit, commercial and consumer segments.

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal balances adjusted for charge-offs, the allowance for credit losses, and any deferred fees or costs on originated loans. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method.

The accrual of interest on all loans is discontinued at the time a loan is 90 days past due. Past due status is based on the contractual terms of the loan. In all cases, loans are placed on nonaccrual if collection of principal or interest is considered doubtful.

All interest accrued but not collected for loans that are placed on nonaccrual is reversed against interest income. The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual status. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

Allowance for Credit Losses-Loans

The allowance for credit losses on loans is a valuation account that is deducted from the loans’ amortized cost basis to present the net amount expected to be collected on the loans. Such allowance is based on losses expected to arise over the life of the asset (contractual term). The allowance for credit losses on loans is established through a provision for credit losses charged to earnings. Loan losses are charged against the allowance when management believes the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance.

The allowance for credit losses is evaluated on a regular basis by management. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available.

Collectively evaluated loans

The Bank measures the allowance for credit losses using the Scaled CECL Allowance for Losses Estimator (“SCALE”) method, which is a simple, spreadsheet-based method developed by the Federal Reserve to assist community banks in calculating a CECL-compliant allowance for credit losses using expected lifetime loss rates. The SCALE tool is a template designed for smaller community banks with total assets of less than $1 billion. It uses publicly available data from Schedule RI-C of the Call Report to derive the initial lifetime loss rates. Management used judgment to further adjust the expected lifetime loss rates with qualitative factors to reflect the facts and circumstances of the Bank’s internal loss history and credit risk factors for each loan segment. The allowance for credit losses is measured on a collective (pool) basis when similar characteristics exist. The Bank segmented its loan portfolio to correspond to call report classification to make peer data more useful.

The qualitative factors are determined based on the various risk characteristics of each loan segment. Risk characteristics relevant to each portfolio segment are as follows:

Residential real estate – The Bank generally does not originate loans with a loan-to-value ratio greater than 80% at origination and does not generally grant loans that would be classified as subprime upon origination. The Bank generally has 1 st and 2 nd liens on property securing equity lines of credit. The majority of loans in this segment are collateralized by owner-occupied residential real estate and repayment is dependent on the credit quality of the individual borrower. The overall health of the economy, including unemployment rates and housing prices, will effect the credit quality in this segment.

Commercial real estate – Loans in this segment are primarily income-producing properties. The underlying cash flows generated by the properties can be adversely impacted by a downturn in the economy as evidenced by increased vacancy rates, which in turn, could have an effect on the credit quality in this segment. Management obtains rent rolls annually and continually monitors the cash flows of these loans.

Multi-family real estate – Loans in this segment are secured primarily by five-or-more unit residential buildings. The overall health of the economy, including unemployment rates and housing prices, will effect the credit quality in this segment.

Commercial – Loans in this segment are made to businesses and are generally secured by assets of the business. Repayment is expected from the cash flows of the business. A weakened economy, and resultant decreased consumer spending, could have an effect on the credit quality in this segment.

Construction – Loans in this segment include both owner-occupied and speculative real estate development loans for which payment is derived from sale of the property. Credit risk is affected by cost overruns, time to sell at an adequate price, and market conditions.

Consumer – Loans in this segment include loans secured by personal property or savings and unsecured loans. Repayment is dependent on the credit quality of the individual borrower.

Individually Evaluated Loans

Loans that do not share risk characteristics are evaluated on an individual loan basis. Loans evaluated individually are not also included in the collective evaluation. For loans that are collateral dependent, that is, when the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the operation or sale of the collateral, expected credit losses are based on fair value of the collateral at the reporting date, adjusted for selling costs as appropriate.

Unallocated component

An unallocated component may be maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated portion of the allowance reflects the margin of imprecision in the underlying assumptions used in the methodologies for estimating collectively and individually evaluated loans in the portfolio.

Allowance for Credit Losses- Off-Balance Sheet Credit Exposures

The Bank has off-balance sheet financial instruments, which include commitments to extend credit, standby letters of credit and commercial letters of credit. The Bank estimates expected credit losses over the contractual period in which the Bank is exposed to risk via a contractual obligation to extend credit, unless that obligation is unconditionally cancellable by the Bank.

The Bank’s allowance for credit losses on off-balance sheet credit exposures is recognized as a liability in accrued expenses and other liabilities on the consolidated balance sheets, with adjustments to the reserve recognized in the provision for credit losses in the consolidated statements of operations. The estimate of credit loss incorporates assumptions for both the likelihood and amount of funding over the estimated life of the commitments, for the risk of loss, and current conditions and expectations. Management periodically reviews and updates the assumptions.

Bank-Owned Life Insurance

Bank-owned life insurance policies are reflected on the consolidated balance sheets at cash surrender value. Changes in the net cash surrender value of the policies, as well as insurance proceeds received (in excess of cash surrender value), are reflected in other income on the consolidated statement of operations and are not subject to income taxes.

Premises and equipment

Land is carried at cost. Buildings, leasehold improvements and furniture and equipment are carried at cost, less accumulated depreciation and amortization, computed on the straight-line method over the estimated useful lives of the assets, or the expected terms of the leases, if shorter. Expected terms include lease option periods to the extent that the exercise of such options is reasonably assured. It is general practice to charge the cost of maintenance and repairs to earnings when incurred; major expenditures for betterments are capitalized and amortized.

Leases

The Bank determines if an arrangement is a lease at inception. Operating lease right-of-use (“ROU”) assets are included in other assets and operating lease liabilities are included in accrued expensed and other liabilities in the consolidated balance sheets. The Bank does not have any finance leases.

ROU assets represent the Bank’s right to use the underlying asset for the lease term and lease liabilities represent the Bank’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term. As most of the Bank’s leases do not provide an implicit rate, the Bank’s incremental borrowing rate is , which is generally the Federal Home Loan Bank advance rate, to determine the present value of lease payments. The operating lease ROU asset is net of lease incentives. The Bank’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Bank will exercise that option. For operating leases, lease expense is recognized on a straight-line basis over the lease term.

The Bank has lease agreements with lease and non-lease components, which are generally accounted for separately. The Bank has not elected the practical expedient to account for lease and non-lease components as one lease component.

Transfers of financial assets

Transfers of an entire financial asset, a group of entire financial assets, or a participating interest in an entire financial asset are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Bank, (2) the transferee obtains the right to pledge or exchange the transferred assets, and (3) the Bank does not maintain effective control over the transferred assets.

Operating Segments

The Company's revenue is primarily derived from the business of banking. The Company's financial performance is monitored on consolidated basis by Mr. John Carroll, CEO, who is considered to be the Company's Chief Operating Decision Maker ("CODM"). Financial performance is reported to the CODM monthly, and the primary measure of performance is consolidated net income. The allocation of resources throughout the Company is determined annually based upon consolidated net income performance. The presentation of financial performance to the CODM is consistent with amounts and financial statement line items shown in the Company's consolidated balance sheets and consolidated statements of operations. Additionally, the Company's significant expenses are adequately segmented by category and amount in the consolidated statements of operations to include all significant items when considering both qualitative and quantitative factors. Significant expenses of the Company include salaries and employee benefits, equipment and occupancy expense, data processing, and other general and administrative expenses.

All of the Company’s financial results are similar and considered by management to be aggregated intoone reportable operating segment. While the Company has assigned certain management responsibilities by business-line, the Company’s CODM evaluates financial performance on a Company-wide basis. The Company's assigned business lines have similar economic characteristics, products, services and customers. Accordingly, all of the Company’s operations are considered by management to be aggregated inone reportable operating segment.

Advertising Costs

Advertising costs are expensed as incurred.

Defined benefit plan

The compensation cost of an employee’s defined pension benefit is recognized on the net periodic pension cost method over the employee’s approximate service period. The aggregate cost method is utilized for funding purposes.

The Bank accounts for its defined benefit pension plan using an actuarial model that allocates pension costs over the service period of employees in the plan. The Bank accounts for the over-funded or under-funded status of its defined benefit plan as an asset or liability in its consolidated balance sheets and recognizes changes in the funded status in the year in which the changes occur through other comprehensive income (loss).

The Bank uses the “10% corridor” method for amortization of actuarial gains and losses within its defined benefit pension plan. Amortization of actuarial gains and losses are only recorded when the amount recorded in accumulated other comprehensive income (loss) is greater than 10% of the projected benefit obligation or the fair value of plan assets, whichever is greater.

The Bank reports the service cost component of net periodic pension cost and net periodic postretirement benefit cost within salaries and employee benefits on the consolidated statements of operations, which is the same line item as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net periodic pension cost and net periodic postretirement benefit cost are reported separately from the service cost component, and included within net periodic pension and postretirement benefit, less service costs in the consolidated statements of operations.

Employee Stock Ownership Plan ("ESOP")

ESOP shares are shown as a reduction of equity and are presented in the consolidated statements of changes in stockholders’ equity as unallocated common stock held by ESOP. Compensation expense for the Company’s ESOP is recorded at an amount equal to the shares committed to be allocated by the ESOP multiplied by the average fair market value of the shares during the period. The Company recognizes compensation expense ratably over the period based upon the Company’s estimate of the number of shares committed to be allocated by the ESOP. When the shares are released, unallocated common stock held by ESOP is reduced by the cost of the ESOP shares released and the difference between the average fair market value and the cost of the shares committed to be allocated by the ESOP is recorded as an adjustment to additional paid-in capital.

The loan receivable from the ESOP is not reported as an asset nor is the Company’s guarantee to fund the ESOP reported as a liability on the Company’s consolidated balance sheet. The employees of the Bank are the participants in the ESOP. Dividends paid on unallocated shares are used to repay the loan to the Company.

Income taxes

Deferred income tax assets and liabilities are determined using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is determined based on the tax effects of the temporary differences between the book and tax bases of the various balance sheet assets and liabilities and gives current recognition to changes in tax rates and laws in the period of the enactment.

A valuation allowance is established against deferred tax assets when, based upon the available evidence including historical and projected taxable income, it is more likely than not that some or all of the deferred tax assets will not be realized.

The Bank does not have any uncertain tax positions at June 30, 2025 or 2024 which require accrual or disclosure. The Bank accounts for interest and penalties related to uncertain tax positions as part of its provision for federal and state income taxes. The Bank hasno interest or penalties recorded for the years ended June 30, 2025 or 2024.

Earnings per Share

Basic earnings per share represent income available to common stockholders divided by the weighted-average number of common shares outstanding during the period. Unallocated ESOP shares are not deemed outstanding for earnings per share calculations. ESOP shares committed to be released are considered to be outstanding for purposes of the earnings per share computation. ESOP shares that have not been legally released, but that relate to employee services rendered during an accounting period (interim or annual) ending before the related debt service payment is made, are considered committed to be released. Diluted earnings per share reflects additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustments to income that would result from the assumed issuance.

Revenue Recognition

The Bank recognizes revenue from contracts with customers when it satisfies its performance obligations. The Bank’s performance obligations are generally satisfied as services are rendered and can either be satisfied at a point in time or over time. The majority of the Bank’s revenue generating transactions are not subject to Accounting Standard Codification (ASC) 606, including revenue generated from financial instruments such as loans or investments securities, as these activities are subject to other GAAP.

Revenues for the Bank subject to ASC 606 include customer service fees in the consolidated statements of operations. These fees are made up of service charges and fees on deposit accounts that are recognized at a point in time, including non-sufficient fund fees, overdraft charge fees and stop-payment fees. Such revenue is derived from transactional information and

is recognized as revenue immediately as the transactions occur or upon providing the service to complete the customer’s transaction. Payment is generally received at the time the performance obligations are satisfied.

Comprehensive income/(loss)

Accounting principles generally require that recognized revenue, expenses, gains and losses be included in net income. Although certain changes in assets and liabilities, such as unrealized gains and losses on securities available for sale and unrecognized pension costs and credits, are reported as a separate component of the stockholders' equity section of the consolidated balance sheet, such items, along with net income, are components of comprehensive income (loss). The components of accumulated other comprehensive loss, included in the stockholders' equity, are as follows.

RESTRICTIONS ON CASH AND AMOUNTS DUE FROM BANKS

From time to time, the Bank is required to maintain average balances on hand or with the Federal Reserve Bank. There wereno required reserve balances at June 30, 2025 and June 30, 2024.

SECURITIES

The amortized cost and fair value of available for sale and held to maturity securities, at June 30, 2025 and June 30, 2024, with gross unrealized gains and losses, follows:

The amortized cost and fair value of debt securities by contractual maturity at June 30, 2025 are shown as follows. Expected maturities may differ from contractual maturities because the issuers, in certain instances, have the right to call or prepay obligations with or without call or prepayment penalties.

There wereno realized gains or losses on securities for the year ended June 30, 2025. Gross realized losses on securities available for sale for the year ended June 30, 2024, amounted to $33,000.

Allowance for Credit Losses-Securities

Available for sale (AFS) and held to maturity (HTM) securities, which are issued by the United States Treasury or are guaranteed by government agencies do not currently have an allowance for credit loss as the Bank determined these securities are either backed by the full faith and credit of the U.S. government and/or there is an unconditional commitment to make interest payments and to return the principal investment in full to investors when a debt security reaches maturity. In assessing the Bank’s investments in government-sponsored and U.S. government guaranteed mortgage-backed securities and government-sponsored enterprise obligations, the contractual cash flows of these investments are guaranteed by the respective government-sponsored enterprise. Accordingly, it is expected that the securities would not be settled at a price less than the par value of the Bank’s investments. The Bank will evaluate the securities portfolio no less than annually, however, certain items which may cause the Bank to change this methodology include legislative changes that reduce or eliminate the U.S. government’s implicit guarantee on such securities. Any expected credit losses would be presented as an allowance for credit loss. For corporate and municipal bonds, whether they are AFS or HTM, a probability of default and a loss given default analysis is performed to determine whether an allowance for credit losses is needed. There wasno allowance for credit losses established on AFS or HTM securities during the years ended June 30, 2025 and June 30, 2024.

Information pertaining to securities with gross unrealized losses at June 30, 2025 and June 30, 2024, aggregated by investment category and length of time that individual securities have been in a continuous loss position, follows:

The Bank monitors the credit quality of securities through the use of credit ratings. Management evaluates debt securities for impairment at least quarterly, and more frequently when economic or market concerns warrant such evaluation. For municipal securities and corporate bonds, the Bank uses credit rating as the primary indicator of credit quality.

At June 30, 2025,136 debt securities have unrealized losses with aggregate depreciation of 4.40% of the Bank’s amortized cost basis. The decline in market value is attributable to changes in interest rates and not to credit quality, and the Bank currently does not believe it is probable that it will be unable to collect all amounts due according to the contractual terms of the investments. Therefore, it is expected that the securities would not be settled at a price less than the par value of the investment. Because the Bank does not intend to sell the securities and it is not “more likely than not” that the Bank will be required to sell the securities before recovery of their amortized cost bases, which may be maturity, the Bank does not consider these securities to be impaired at June 30, 2025.

Accrued Interest Receivable

There wereno securities with delinquent interest payments or on non-accrual status at June 30, 2025 or June 30, 2024. The balance of accrued interest receivable on investments was $857,000 and $813,000 at June 30, 2025 and June 30, 2024, respectively.

Marketable equity securities

At June 30, 2024, marketable equity securities included common stock securities in industry sectors related to technology, consumer staples, financial services, aerospace and other. Net realized and unrealized gains recognized in earnings during the years ended June 30, 2025 and 2024 were $374,000 and $378,000, respectively. The Company didnot hold any marketable equity securities as of June 30, 2025 . At June 30, 2024, the net unrealized gain on marketable equity securities was $1.2 million.

LOANS

A summary of the balances of loans follows:

The Bank has sold mortgage loans in the secondary mortgage market and has retained the servicing responsibility and receives fees for the services provided. Total loans serviced for others at June 30, 2025 and June 30, 2024 amounted to$22.4 million and $24.8 million, respectively, and are not included on the accompanying consolidated balance sheets.

Activity in the allowance for credit losses for the year ended June 30, 2025 follows:

The increase in the allowance for credit losses during the year ended June 30, 2025 was due to overall growth in the loan portfolio and charge offs.

The allowance for credit losses, by loan segment, at June 30, 2025 and June 30, 2024 follows:

Activity in the allowance for credit losses for the year ended June 30, 2024 follows:

The decrease in the allowance for credit losses on loans during the year ended June 30, 2024 was primarily due to the adoption of ASU 2016-13. The increase in the allowance for credit losses on off balance sheet credit exposures was primarily due to the adoption of ASU 2016-13.

The following is a summary of past due and non-accrual loans at June 30, 2025 and June 30, 2024:

There were no loans greater than 90 days past due and still accruing at June 30, 2025 or June 30, 2024. The balance of accrued interest receivable on loans was $2.5 million at June 30, 2025 and $2.4 million at June 30, 2024. There wasno accrued interest reversed on non-accrual loans during the years ended June 30, 2025 or June 30, 2024.

Interest income recognized on nonaccrual financial assets totaled $11,700 and $9,800 for the years ended June 30, 2025 and 2024. No additional funds are committed to be advanced in connection with the individually evaluated loans. There wereno loan modifications to borrowers experiencing financial difficulty during the years ended June 30, 2025 or June 30, 2024.

At June 30, 2025, $270,000 of commercial loans had an allocated reserve of $270,000.

Credit quality information

The Bank has a ten-grade internal loan rating system for commercial real estate, multi-family, commercial, and construction loans as follows:

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Loans rated in the first six grades 1-6 are considered “pass” rated loans with low to average risk.

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Loans rated 7 are considered “watch.” These loans are starting to show signs of potential weakness and are being closely monitored by management.

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Loans rated 8 are considered “substandard.” Generally, a loan is considered substandard if it is inadequately protected by the current net worth and paying capacity of the obligors and/or the collateral pledged. There is a distinct possibility that the Bank will sustain some loss if the weakness is not corrected.

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Loans rated 9 are considered “doubtful.” Loans classified as doubtful have all the weaknesses inherent in those classified substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of existing facts, conditions and values, highly questionable and improbable.

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Loans rated 10 are considered uncollectible (“loss”) and of such little value that their continuance as loans is not warranted.

On a periodic basis, management formally reviews the ratings on all commercial real estate, multi-family, commercial, and construction loans. Annually, the Bank engages an independent third party to review a significant portion of the loans within these segments. Management uses the results of these reviews as part of its internal review process.

Credit quality for residential real estate, home equity loans and lines-of-credit, and consumer loans is determined by monitoring delinquency reports and loan payment history, and through on-going communication with customers.

The following table presents the Bank’s risk rated loans by year of origination and gross write-offs for the year ended June 30, 2025:

For the Bank's commercial and construction portfolio the following table presents the Bank’s risk rated loans by year of origination and gross write-offs for June 30, 2024:

PREMISES AND EQUIPMENT

A summary of the cost and accumulated depreciation and amortization of premises and equipment follows:

Depreciation and amortization expense for the years ended June 30, 2025 and 2024 amounted to $847,000 and $750,000, respectively.

DEPOSITS

A summary of deposit balances, by type, is as follows:

A summary of term certificate accounts, by maturity, is as follows:

At June 30, 2025, the Bank hadno brokered demand deposits and $39.4 million of brokered term certificates, respectively. Included in total deposits were $10.0 million and $26.3 million of brokered demand and term certificates, respectively, at June 30, 2024.

FEDERAL HOME LOAN BANK ADVANCES

A summary of FHLB of Boston advances, by maturity, is as follows:

At June 30, 2025, advances totaling $125,000,000 were callable or adjustable at the FHLB of Boston’s discretion within one year.

The Bank also has a$5,310,000 available line of credit with the FHLB at aninterest rate that adjusts daily. The Bank hadno balance outstanding on the line of credit on June 30, 2025. On June 30, 2024, the Bank’s outstanding balance on the line of credit was $2,469,000, which is included in the above table. Borrowings under the line are limited to 2% of the Bank’s total assets. All borrowings from the FHLB are secured by a blanket lien on qualified collateral, defined as 75% of the carrying value of first mortgage loans on owner-occupied residential property, and 50% of the carrying value of specifically pledged commercial real estate loans. Additionally, on June 30, 2025 the Bank had a $67.0 million line of credit through the Federal Reserve Borrower in Custody (BIC) program. At that date, there were no amounts outstanding.

INCOME TAXES

Allocation of federal and state income taxes between current and deferred portions is as follows:

The reasons for the differences between the statutory corporate federal income tax rate and the Bank’s effective tax rate are summarized as follows:

The tax effects of each item that give rise to deferred taxes are as follows:

A summary of the change in the net deferred tax asset (liability) is as follows:

At June 30, 2025, the Company had a charitable contribution carryover of $2,062,000 for federal tax purposes and $2,329,000 for state tax purposes, which expire on June 30, 2030.

The federal income tax reserve for loan losses at the Bank’s base year amounted to $3,889,000. If any portion of the reserve is used for purposes other than to absorb loan losses, approximately 150% of the amount actually used (limited to the amount of the reserve) would be subject to taxation in the fiscal year in which used. As the Bank intends to use the reserve to only absorb loan losses, a deferred income tax liability of $1,093,000 has not been provided.

The Bank’s income tax returns are subject to review and examination by federal and state taxing authorities. The Bank is currently open to audit under the applicable statutes of limitations by the Internal Revenue Service for the years ended June 30, 2022 through 2025. The years open to examination by state taxing authorities vary by jurisdiction; no years prior to 2022 are open.

MINIMUM REGULATORY CAPITAL REQUIREMENTS

Effective January 1, 2020, the Bank elected to comply with the community bank leverage ratio framework issued by the federal banking agencies. The framework provides for a simple measure of capital adequacy, calculated as Tier 1 capital divided by average total consolidated assets, which is consistent with how the Company currently calculates its leverage ratio. Under this framework, a bank that maintains a community bank leverage ratio of greater than 9% is considered to have satisfied the risk-based and leverage capital ratios. As of June 30, 2025 and June 30, 2024, Winchester Savings Bank met the minimum requirement with a community bank leverage ratio of 10.48% and 9.92%, respectively. As a small bank holding company, the Company is exempt from required minimum regulatory capital requirements.

EMPLOYEE BENEFIT PLANS

Defined benefit pension plan

The Company provided pension benefits for eligible employees through a defined benefit pension plan. Substantially all employees participate in the retirement plan on a non-contributing basis and are fully vested after three years of service. Employees hired after July 1, 2016 were fully vested after five years of service. During the year ended June 30, 2023, the Company froze the plan to new participants and converted its traditional defined benefit plan into a cash balance plan whereby all employees hired prior to November 1, 2022 receive a benefit equal to 4% of their annual salary. During the year ended June 30, 2025 the Company amended the plan to apply a one-time cash balance plan increase and subsequent plan freeze effective October 31, 2024.

Information pertaining to the activity in the plan is as follows:

For the year ended June 30, 2025, the plan amendment of $1,783,000 and the actuarial loss of $475,000, are due to the plan freeze and the one-time cash balance increases. For the year ended June 30, 2024, the actuarial gain was $499,000, which was primarily due to an increase in the discount rate.

The assumptions used to determine the benefit obligation are as follows:

The components of net periodic pension cost are as follows:

The actuarial assumptions used to determine net periodic pension cost were as follows:

The Bank has selected its assumption with respect to the expected long-term rate of return based on prevailing yields on high-quality fixed-income investments increased by a premium for equity return expectations.

The following table sets forth by level, within the fair value hierarchy, the plan’s assets at fair value. Classification within the fair value hierarchy table is based upon the lowest level of any input that is significant to fair value measurement.

All plan assets are measured at fair value in Level 1 based on quoted market prices in an active exchange market, with the exception of those plan assets that are measured at net asset value.

(a)

In accordance with FASB ASC 820, Fair Value Measurements, certain investments that were measured at net asset value per share (or its equivalent), have not been classified in the fair value hierarchy. There are no unfunded commitments or redemption restrictions for these investments, which can be redeemed on a daily basis.

The following table summarizes investments for which fair value is measured using the net asset value per share practical expedient:

The defined benefit plan offers a common and collective trust as the underlying investment structure for the pension plan. The target allocation mix for the common and collective trust portfolio calls for an equity-based investment deployment range from 49% to 63% of total portfolio assets. The remainder of the portfolio is allocated to fixed income, with a target range of 28% to 42%, and other investments including global asset allocation and hedge funds and limited partnerships with a target range from 3% to 15%. The overall investment objective is to diversify investments across a spectrum of investment types to limit risks from large market changes. To a limited extent, the defined benefit plan invests in hedge funds which are designed to provide higher rates of return due to the aggressive nature of the funds.

The Company did not make any contributions to its pension plan during fiscal year 2025 and does not expect to make any contribution during fiscal year 2026.

Estimated future benefit payments which reflect expected future service, as appropriate, assuming employees retire at age 65 and take lump-sum payments, are as follows:

Post-retirement benefits other than pensions

The Bank offers post-retirement medical insurance for certain retirees of the Bank hired prior to July 1, 1994. The Bank pays up to $1,700 annually for eligible employees who have attained age 65 and retire subsequent to that age. The Bank also pays retiree life insurance premiums for individuals with a date of hire prior to June 30, 2003.

The actuarial liability for these post-retirement benefits, none of which has been funded, is as follows:

Actuarial assumptions, using the projected unit credit funding method with service pro-ration, include a discount rate of 5.05% and 5.18% for the years ended June 30, 2025 and June 30, 2024, respectively.

The components of the periodic expense for these post-retirement benefits are as follows:

Estimated future benefit payments are as follows:

401(k) plan

The Bank has a 401(k) Plan (the “Plan”) whereby each employee 21 years of age or older and having completed at least three months of service, beginning with their date of employment, automatically becomes a participant in the Plan. Employees may contribute up to the amount allowed by law. For employees hired prior to November 1, 2022, the Bank makes matching contributions equal to 50% of the first 6% of an employee’s compensation contributed to the Plan. For employees hired on or after November 1, 2022, the Bank makes matching contributions equal to 50% of the first 10% of an employee’s compensation contributed to the Plan. Effective January 1, 2025, the Plan was amended to make matching contributions equal to 50% of the first 10% of an employee's compensation for all plan participants. All participants are fully vested. For the years ended June 30, 2025 and 2024, expense attributable to the Plan amountedto $183,000 and $175,000, respectively.

Employees Stock Option Plan ("ESOP")

As part of the Initial Public Offering ("IPO") completed on April 30, 2025, the Bank established a tax-qualified ESOP to provide eligible employees the opportunity to own Company shares. The ESOP borrowed $3.3 million from the Company to purchase 334,633 common shares on the open market. The loan is payable in annual installments over 20 years at an interest rate of 7.5%. As the loan is repaid to the Company, shares are released and allocated proportionally to eligible participants on the basis of each participant’s proportional share of compensation relative to the compensation of all participants. The unallocated ESOP shares are pledged as collateral on the loan.

The Company accounts for its ESOP in accordance with FASB ASC 718-40, Compensation – Stock Compensation. Under this guidance, unreleased shares are deducted from stockholders’ equity as unearned ESOP shares on the accompanying consolidated balance sheets.

The Company recognizes compensation expense equal to the fair value of the ESOP shares during the periods in which they are committed to be released. To the extent that the fair value of the Company’s ESOP shares differs from the cost of such shares, the difference will be credited or debited to stockholders' equity. As the loan is internally leveraged, the loan receivable from the ESOP to the Company is not reported as an asset nor is the debt of the ESOP shown as a liability on the Company’s consolidated balance sheets.

The Company recognized compensation expense related to the ESOP in the amount of $27,500 for the year ended June 30, 2025, no compensation expense recognized for 2024.

Bonus plans

The Bank has discretionary bonus plans which provide for a bonus based on Bank and/or individual performance. Expense related to the bonus plans amounted to $586,000 and $468,000 for the years ended June 30, 2025 and 2024, respectively.

Supplemental executive retirement plan

During the year ended June 30, 2023, the Bank entered into supplemental compensation agreements with certain executive officers which provide for specified payments upon retirement subject to certain limitations as set forth in the agreements. At June 30, 2025 and 2024, accrued expenses related to these agreements were $965,000 and $700,000, respectively.

COMMITMENTS AND CONTINGENCIES

In the normal course of business, there are outstanding commitments and contingencies which are not reflected in the accompanying consolidated balance sheets.

Loan commitments

The Bank is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit, which involve elements of credit and interest rate risk in excess of the amount recognized in the accompanying consolidated balance sheets. The contract amount of these instruments reflects the extent of involvement the Bank has in these particular classes of financial instruments.

The Bank’s exposure to credit loss is represented by the contractual amount of the instruments. The Bank uses the same credit policies in making commitments as it does for on-balance sheet instruments.

At June 30, 2025 and 2024, off-balance sheet financial instruments whose contract amounts represent credit risk consisted of:

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Unadvanced funds on lines-of-credit have fixed expiration dates and may expire without being drawn upon. Therefore, the total commitment amount does not necessarily represent future cash requirements. The Bank evaluates each customer’s creditworthiness on a case-by-case basis. Except for commercial lines-of-credit amounting to $2,614,000 at June 30, 2025 and commercial lines of credit and overdraft lines of credit amounting to $8,297,000 at June 30,2024, these financial instruments are secured by mortgage liens on real estate. Commercial lines-of-credit are generally secured by business assets while overdraft lines-of-credit are generally unsecured.

Loans sold with recourse obligations

The Bank sells certain loans on a servicing-retained basis to the FHLB pursuant to contracts which include limited recourse provisions in the event a loss is incurred on the loan. At June 30, 2025 and 2024, the maximum contingent liability associated with loans sold with recourse to the FHLB was $784,000 and $948,000, respectively, which is not recorded in the consolidated financial statements.

Operating lease commitments

Pursuant to the terms of noncancelable lease agreements in effect at June 30, 2025, pertaining to premises, future minimum rent commitments were as follows:

The leases contain options to extend for periods fromone tofive years. The cost of such rentals is not included above. Total rent expense for theyears ended June 30, 2025 and 2024 amounted to $228,000 and $234,000, respectively. No rental income was recorded for the years ended June 30, 2025 and 2024.

Legal contingencies

Various legal claims may arise from time to time and, in the opinion of management, these claims will have no material effect on the Bank’s consolidated financial statements.

RELATED PARTY TRANSACTIONS

The Bank has granted loans to its directors and executive officers and at June 30, 2025 and 2024, the amount of such loans was $10,378,000 and $10,621,000, respectively. Such loans are made in the ordinary course of business at the Bank’s normal credit terms, including interest rate and collateral requirements, and do not represent more than a normal risk of collection.

FAIR VALUES OF ASSETS AND LIABILITIES

Determination of fair value

The Bank uses fair value measurements to record fair value adjustments to certain assets. Fair value is the price that would be received to sell an asset in an orderly transaction between market participants at the measurement date. Fair value is best determined based upon quoted market prices. However, in some instances, quoted market prices may not be available. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques, including collateral value. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the assets.

Assets measured at fair value on a recurring basis

Assets measured at fair value on a recurring basis are summarized below. There areno liabilities measured at fair value on recurring basis at June 30, 2025 or June 30, 2024.

The following methods and assumptions were used by the Bank in estimating fair value:

Cash and Cash Equivalents – For these financial instruments, which have original maturities of 90 days or less, their carrying amounts reported in the Consolidated Balance Sheets approximate fair value.

Available for sale and held to maturity securities – The Company’s investment in debt securities is generally classified within Level 2 of the fair value hierarchy. For those securities, the Company obtains fair value measurements from independent pricing services which are not adjusted by management. The fair value measurements consider observable data that considers standard input factors such as observable market data, benchmark yields, interest rate volatilities, broker/dealer quotes, credit spreads and new issue data.

FHLB Stock – The fair value of FHLB stock approximates the carrying amount based on the redemption provisions of the FHLB. These assets were classified as Level 3.

Loans–The fair value of loans is measured on an exit price basis incorporating discounts for credit, liquidity and marketability factors. Loans were classified as Level 3 since the valuation methodology utilizes significant unobservable inputs.

Accrued Interest Receivable – For these financial instruments, which have original maturities of 90 days or less, their carrying amounts reported in the Consolidated Balance Sheets approximate fair value. These assets were classified as Level 2.

Deposits – The fair value of deposits is valued using a replacement cost of funds approach and discounted to the market rates and based on weighted remaining maturity for maturing deposits. Deposits were classified as Level 3 since the valuation methodology utilizes significant unobservable inputs.

FHLB Advances – The fair value of the FHLB Advances approximates carrying amount of these liabilities were classified as Level 3.

Accrued Interest Payable and Mortgagor's escrow accounts– For these financial instruments, which have original maturities of 90 days or less, their carrying amounts reported in the Consolidated Balance Sheets approximate fair value. These liabilities were classified as Level 2.

Assets measured at fair value on a non-recurring basis

The Bank may also be required, from time to time, to measure certain other assets and liabilities at fair value on a non-recurring basis in accordance with generally accepted accounting principles.

These adjustments to fair value usually result from application of lower-of-cost-or-market accounting or write-downs of individual assets. There wereno assets or liabilities measured at fair value on a non-recurring basis at June 30, 2025 or June 30, 2024.

The estimated fair values, and related carrying amounts, of the Bank’s financial instruments are as follows. Certain financial instruments and all nonfinancial instruments are exempt from disclosure requirements. Accordingly, the aggregate fair value amounts presented herein do not represent the underlying fair value of the Bank.

EARNINGS PER SHARE

Basic EPS represents net income available to common stockholders divided by the weighted-average number of common shares outstanding during the year.

Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common shares (such as stock options) were exercised or converted into additional common shares that would then share in the earnings of the Company. Diluted EPS is computed by dividing net income attributable to common stockholders by the weighted-average number of common shares outstanding for the year, plus the effect of potential dilutive common share equivalents computed using the treasury stock method.

There wereno securities that had a dilutive effect during the years ended June 30, 2025 and 2024, and therefore the weighted-average common shares outstanding used to calculate both basic and diluted EPS are the same. Unallocated ESOP shares are not deemed outstanding for earnings per share calculations. For the years ended June 30, 2025 and 2024, there wereno anti-dilutive shares. Earnings per share data is not applicable for the year ended June 30, 2024 as the Company hadno shares outstanding.

SUBSEQUENT EVENTS

Management has evaluated subsequent events through the date the consolidated financial statements were issued. There were no subsequent events that require adjustment to or disclosure in the consolidated financial statements.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated.