Winchester Bancorp, Inc./MD/
For the period ended Sep 30, 2025. Filed Nov 12, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 12, 2025
WSBK$13.61-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-12.
0000950170-25-069255
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-12.
0001193125-25-277465
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 146 previous paragraphs and 128 current paragraphs.
88 unchanged; 24 reworded; 16 added; 27 removed; 7 previous and 0 current paragraphs rearranged.
Tables are not compared: 12 previous and 8 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (16)
Current report
Allowance for Credit Losses on Loans. The allowance for credit losses is established based upon the Company's current estimate of expected lifetime credit losses on loans measured at amortized cost. Credit losses are charged against the allowance when management's assessments confirm that the Company will not collect the full amortized cost basis of a loan. Subsequent recoveries, if any, are credited to the allowance. The Company estimates credit losses for financial assets on a collective basis for loans sharing similar risk characteristics. The Company segments financial assets with similar risk characteristics and has elected to segment its loans based on Federal Call codes used for reporting loans to the Federal Deposit Insurance Corporation as part of the Call Report process. These segments are collectively evaluated for expected credit losses using a quantitative Discounted Cash Flow ("DCF") model combined with an assessment of certain qualitative factors designed to address forecast risk and model risk inherent in the quantitative model output. The Company has elected to use this approach because DCF models allow for effective incorporation of a reasonable and supportable forecast in a directionally consistent and objective manner and peer data is available for certain inputs such as the probability of default and the loss given default. The quantitative model utilizes a loss factor based approach to estimate expected credit losses, which are derived from industry peer loss experience. The model estimates expected credit losses using loan level data over the estimated life of the exposure, considering the effect of prepayments. Economic forecasts are incorporated into the estimate over a reasonable and supportable forecast period, beyond which is a reversion to the historical long-run average using the straight-line reversion method. Management periodically evaluates a reasonable and supportable forecast period and a reversion period to be appropriate for purposes of estimating expected credit losses. The qualitative risk factors impacting the expected risk of loss within the portfolio include the following:
Current report
changes in the Company’s loan policies, procedures and strategies;
Current report
changes in international, national, regional, and local economic and business conditions;
Current report
changes in the nature and volume of the portfolio and terms of loans;
Current report
changes in experience, depth, and ability of lending management;
Current report
changes in the volume, trend, and severity of past due financial assets;
Current report
changes in the quality of the organization’s loan review system;
Current report
changes in the value of underlying collateral for collateral-dependent loans;
Current report
the existence and effect of any concentrations of credit, and changes in the level of such concentration; and
Current report
the effect of competition and legal/regulatory requirements on the portfolio.
Current report
Cash and Cash Equivalents. Cash and cash equivalents increased $2.5 million, or 4.5%, to $57.7 million at September 30, 2025 from $55.2 million at June 30, 2025.
Current report
Gross Loans. Loans increased $42.0 million, or 5.6%, to $796.2 million at September 30, 2025 compared to $754.1 million at June 30, 2025. The main driver of the new growth was in construction and commercial real estate loans, which increased $15.5 million and $13.4 million, respectively. The multi-family and residential real estate portfolios also increased $7.1 million and $5.7 million, respectively. We remained focused on originating construction, commercial real estate, and multi-family real estate loans as the primary drivers of loan portfolio growth.
Current report
Deposits. Deposits increased $37.2 million, or 5.5%, to $716.4 million at September 30, 2025 from $679.2 million at June 30, 2025. The increase was due primarily to an increase in money market accounts, which increased $49.3 million, or 40.4%, to $169.4 million at September 30, 2025 from $120.1 million at June 30, 2025; this was due to the growth in our municipal customer deposits. The offset was due to the certificates of deposit decrease of $8.5 million, or 3.0%, to $274.7 million at September 30, 2025 from $283.2 million at June 30, 2025. All of our deposits are fully insured by the FDIC or the Massachusetts Depositors Insurance Fund.
Current report
Non-interest income. Non-interest income information is as follows.
Current report
The decrease in gain on marketable equity securities, net, was due to the liquidation of the equities portfolio in June 2025. In addition, in the current quarter the Company recognized $317,000 loss in sale of securities available for sale, which were replaced with higher yielding investment securities as part of the Company’s investment portfolio restructuring.
Current report
Non-interest Expense. Non-interest expense information is as follows.
Removed paragraphs (27)
Previous report
Allowance for Credit Losses on 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.
Previous report
We measure the allowance for credit losses on loans using the SCALE method, which is a simple, spreadsheet-based method developed by the Federal Reserve Board to assist community banks in calculating a CECL compliant allowance for credit losses using proxy 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 to derive the initial proxy lifetime loss rates. Management uses judgment to further adjust the proxy expected lifetime loss rates with qualitative factors to reflect the facts and circumstances of our internal loss history and credit risk factors for each loan segment. The allowance for credit losses on loans is measured on a collective (pool) basis when similar characteristics exist. We segment our loan portfolio to correspond to call report classification to make peer data more useful.
Previous report
Cash and Cash Equivalents. Cash and cash equivalents increased $22.5 million, or 51.0%, to $66.6 million at March 31, 2025 from $44.1 million at June 30, 2024. The increase represents subscription funds from prospective investors in our initial public offering prior to the closing of the offering.
Previous report
Deposits. Deposits increased $67.7 million, or 10.7%, to $703.1 million at March 31, 2025 from $635.4 million at June 30, 2024. The increase was due primarily to an increase in money market accounts, which increased $33.6 million, or 39.3%, to $119.1 million at March 31, 2025 from $85.5 million at June 30, 2024, as customers continued to hold deposit products with higher interest rates. The increase in deposits was also due to a $22.2 million, or 18.6% in NOW and demand deposits. NOW and demand deposits included $34.9 million of subscription funds from prospective investors in our initial public offering prior to the closing of the offering. Certificates of deposits increased $18.9 million, or 7.2%, to $281.1 million at March 31, 2025 from $262.2 million at June 30, 2024. This increase was comprised of an increase of $18.7 million, or 11.6%, in certificates of deposit in amounts of less than $250,000, and an increase of $272,000, or 0.3%, in certificates of deposit in amounts of $250,000 or greater (the limit for federal deposit insurance). All of our deposits are fully insured under the DIF.
Previous report
Other Income. Other income information is as follows.
Previous report
The decrease in gain on marketable equity securities, net, was due to more favorable market conditions in the prior period. The increase in income on bank owned life insurance was due to the purchase of $4.0 million of additional policies during the 2025 fiscal year.
Previous report
Operating Expense. Operating expense information is as follows.
Previous report
Annualized.
Previous report
Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
Previous report
Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
Previous report
Net interest margin represents net interest income divided by average total interest-earning assets.
Previous report
General. We recorded a net income of $46,000 and $678,000 for the nine months ended March 31, 2025 and 2024. The decrease in net income was due primarily to increases in interest expense and the provision for credit losses, partially offset by an increase in interest and dividend income and a decrease in income tax expense.
Previous report
Interest and Dividend Income. Interest and dividend income increased $6.0 million, or 23.8%, to $31.4 million for the nine months ended March 31, 2025, from $25.3 million for the nine months ended March 31, 2024. Interest and fees on loans, which is our primary source of interest income, increased $5.3 million, or 23.7%, to $27.7 million for the nine months ended March 31, 2025, from $22.4 million for the nine months ended March 31, 2024.
Previous report
Interest Expense. Total interest expense increased $4.6 million, or 32.0%, to $19.2 million for the nine months ended March 31, 2025, compared to $14.5 million for the nine months ended March 31, 2024. Interest expense on deposits increased $3.3 million, or 28.8%, to $14.6 million for the nine months ended March 31, 2025, from $11.4 million for the nine months ended March 31, 2024. Our average balance of interest-bearing deposits increased $61.0 million, or 11.3%, to $600.6 million, while our average cost of deposits increased 44 basis points to 3.25% for the nine months ended March 31, 2025, from 2.81% for the nine months ended March 31, 2024. The increase in the average cost of deposits was due to increases in market interest rates as well as a higher percentage of our deposits consisting of certificates of deposit, which bear higher rates than other deposit categories.
Previous report
Interest expense on Federal Home Loan Bank advances increased $1.4 million, or 43.5%, to $4.5 million for the nine months ended March 31, 2025, from $3.2 million for the nine months ended March 31, 2024. The increase was due to increases in both our average balance of Federal Home Loan Bank advances ($40.3 million, or 41.9%) and our average cost of borrowings (five basis points to 4.44% for the nine months ended March 31, 2025, from 4.39% for the nine months ended March 31, 2024).We increased Federal Home Loan Bank borrowings in recent periods primarily to fund loan growth. The increase in the average cost of borrowings was due to increases in market interest rates between the periods.
Previous report
Net Interest Income. Net interest income was $12.1 million for the nine months ended March 31, 2025, compared to $10.8 million for the nine months ended March 31, 2024, as our interest income increased faster than our interest expense. Our interest rate spread increased to 1.50% for the nine months ended March 31, 2025 from 1.49% for the nine months ended March 31, 2024, while our net interest margin decreased to 1.93% for the nine months ended March 31, 2025 from 1.94% for the nine months ended March 31, 2024. The interest rate spread and net interest margin were both adversely impacted by the higher market interest rates for most of fiscal 2025.
Previous report
Provision for Credit Losses. Based on an analysis of the factors described in “Critical Accounting Policies—Allowance for Credit Losses,” we recorded a provision for credit losses of $1.4 million for the nine months ended March 31, 2025, compared to a provision of $239,000 for the nine months ended March 31, 2024. The provision for credit losses on loans was $1.5 million while a benefit of $147,000 was recorded for off balance sheet commitments. The increase in the provision for credit losses on loans for the nine months ended March 31, 2025 was primarily due to our charging off approximately 85% of a $1.6 million commercial loan as of September 30, 2024 and an additional $50,000 in the current quarter ended March 31, 2025 due to the borrower’s filing for bankruptcy protection and terminating operations of the underlying business.
Previous report
Other Income. Other income information is as follows.
Previous report
Gain on sale of fixed assets during the 2024 period was related to the sale of a bank branch. The decrease in gain on marketable equity securities, net, was due to unfavorable market conditions during the 2025 period, while the increase in income on bank owned life insurance was due to the purchase of $4.0 million of additional policies during the 2025 fiscal year.
Previous report
Operating Expense. Operating expense information is as follows.
Previous report
Income Taxes. Income taxes decreased by $171,000 to a benefit of $90,000 for the nine months ended March 31, 2025, compared to a provision of $81,000 for the nine months ended March 31, 2024. The decrease in the income tax provision was due primarily to a net loss for the 2025 period.
Previous report
Average Balances and Yields
Previous report
Annualized.
Previous report
Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
Previous report
Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
Previous report
Net interest margin represents net interest income divided by average total interest-earning assets.
Previous report
Rate/Volume Analysis
Reworded paragraphs (24)
Previous wording
Management’s discussion and analysis of financial condition and results of operations at March 31, 2025 and June 30, 2024 and for the three and nine months ended March 31, 2025 and 2024 is intended to assist in understanding the financial condition and results of operations of the Company. The information contained in this section should be read in conjunction with the unaudited financial statements and the notes thereto appearing in Part I, Item 1, of this Quarterly Report on Form 10-Q.
Current wording
Management’s discussion and analysis of financial condition and results of operations at September 30, 2025 and June 30, 2025 and for the three months ended September 30, 2025 and 2024 is intended to assist in understanding the financial condition and results of operations of the Company. The information contained in this section should be read in conjunction with the unaudited financial statements and the notes thereto appearing in Part I, Item 1, of this Quarterly Report on Form 10-Q.
Previous wording
The allowance for credit losses on loans 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. For example, an increase of 25 basis points as to our lifetime loss rate for qualitative factors for all loan categories at March 31, 2025 would have increased our allowance for credit losses on loans at that date to $5.4 million from $3.6 million.
Current wording
The allowance for credit losses on loans 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. For example, an increase of 25 basis points as to our lifetime loss rate for qualitative factors for all loan categories at September 30, 2025 would have increased our allowance for credit losses on loans at that date to $6.3 million from $4.4 million.
Previous wording
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.
Current wording
Loans that do not share similar risk characteristics with any pools of assets are subject to individual evaluation and are removed from the collectively assessed pools to avoid double counting. This includes loans on non-accrual and loans that are 90 days or greater past due. For the loans that will be individually evaluated, the Company will use either a DCF approach or a fair value of collateral approach. The latter approach will be used 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.
Previous wording
Total Assets. Total assets increased $70.1 million, or 8.2%, to $923.1 million at March 31, 2025, from $853.0 million at June 30, 2024. The increase was primarily due to increases in loans and cash and cash equivalents.
Current wording
Total Assets. Total assets increased $55.8 million, or 5.9%, to $1.0 billion at September 30, 2025, from $949.4 million at June 30, 2025. The increase was primarily due to increases in loans, investment securities, and cash and cash equivalents.
Previous wording
Investment Securities. Investment securities, comprised of both available for sale and held to maturity securities, aggregated $86.8 million at March 31, 2025 compared to $86.6 million at June 30, 2024, as we used excess cash to fund loan growth instead of investing in securities.
Current wording
Investment Securities. Investment securities, comprised of both available for sale and held to maturity securities, aggregated $115.4 million at September 30, 2025 compared to $104.5 million at June 30, 2025, as we continued to invest stock offering proceeds into government agency and mortgage backed securities.
Previous wording
Borrowings. Borrowings, which consisted solely of Federal Home Loan Bank of Boston advances, increased $1.5 million, or 1.2%, to $131.0 million at March 31, 2025, compared to $129.5 million from June 30, 2024.
Current wording
Borrowings. Borrowings, which consisted solely of Federal Home Loan Bank of Boston advances, increased $17.0 million, or 11.6%, to $164.0 million at September 30, 2025, compared to $147.0 million at June 30, 2025; the increase was used to fund asset growth.
Previous wording
Total Surplus. Total surplus increased $626,000 and was $80.9 million at March 31, 2025 and $80.3 million at June 30, 2024. Total surplus increased due to a $580,000 decrease in accumulated other comprehensive loss to $1.2 million at March 31, 2025, and by a net income of $46,000 for the nine months ended March 31, 2025.
Current wording
Total Stockholders’ Equity. Total stockholders’ equity increased $1.6 million, and was $117.0 million at September 30, 2025 and $115.4 million at June 30, 2025. Total stockholders’ equity increased due to a $614,000 decrease in accumulated other comprehensive loss to $1.1 million at September 30, 2025, and by net income of $962,000 for the three months ended September 30, 2025.
Previous wording
General. We recorded net income of $305,000 and $192,000 for the three months ended March 31, 2025 and 2024, respectively. The increase in net income was due to an increase in interest and dividend income and a decrease in provision for credit loss expense, partially offset by increases in interest expense, and operating expense, and a decrease in other income.
Current wording
General. We recorded net income of $962,000 and net loss of $632,000 for the three months ended September 30, 2025 and 2024, respectively. The increase in net income was due to an increase in interest and dividend income and a decrease in provision for credit loss expense, partially offset by an increase in operating expense, and a decrease in other income.
Previous wording
Interest and Dividend Income. Interest and dividend income increased $1.6 million, or 17.4%, to $10.6 million for the three months ended March 31, 2025, from $9.0 million for the three months ended March 31, 2024. Interest and fees on loans, which is our primary source of interest income, increased $1.6 million, or 20.2%, to $9.5 million for the three months ended March 31, 2025.
Current wording
Interest and Dividend Income. Interest and dividend income increased $1.7 million, or 16.7%, to $11.9 million for the three months ended September 30, 2025, from $10.2 million for the three months ended September 30, 2024. Interest and fees on loans, which is our primary source of interest income, increased $1.4 million, or 15.4%, to $10.4 million for the three months ended September 30, 2025.
Previous wording
The average balance of loans increased by $79.8 million, or 12.2%, to $735.3 million for the three months ended March 31, 2025, over the average balance for the three months ended March 31, 2024, while the average yield on loans increased by 35 basis points to 5.16% for the three months ended March 31, 2025, from 4.81% for the three months ended March 31, 2024. The increase in the average yield was due to increases in market interest rates as well as in improvement in the composition of our loan portfolio to include a higher percentage of higher yielding construction and commercial real estate loans, as well as multi-family residential real estate loans. The increase in average balance was due to our continuing to pursue new commercial relationships.
Current wording
The average balance of loans increased by $74.3 million, or 10.6%, to $775.0 million for the three months ended September 30, 2025, over the average balance for the three months ended September 30, 2024, while the average yield on loans increased by 22 basis points to 5.37% for the three months ended September 30, 2025, from 5.15% for the three months ended September 30, 2024. The increase in the average yield was due to increases in market interest rates as well as a change in the composition of our loan portfolio to include a higher percentage of higher yielding construction and commercial real estate loans, as well as multi-family residential real estate loans. The increase in average balance was due to our continuing to pursue new commercial relationships.
Previous wording
Interest Expense. Total interest expense increased $664,000, or 11.9%, to $6.2 million for the three months ended March 31, 2025, compared to $5.6 million for the three months ended March 31, 2024. Interest expense on deposits increased $370,000, or 8.6%, to $4.7 million for the three months ended March 31, 2025, from $4.3 million for the three months ended March 31, 2024. Our average balance of interest-bearing deposits increased $59.5 million, or 10.75%, to $612.6 million, while our average cost of deposits decreased six basis points to 3.06% for the three months ended March 31, 2025, from 3.12% for the three months ended March 31, 2024.
Current wording
Interest Expense. Total interest expense decreased $267,000, or 4.1%, to $6.2 million for the three months ended September 30, 2025, compared to $6.5 million for the three months ended September 30, 2024. Interest expense on deposits decreased $339,000, or 6.8%, to $4.7 million for the three months ended September 30, 2025, from $5.0 million for the three months ended September 30, 2024. Our average balance of interest-bearing deposits increased $41.4 million, or 7.0%, to $629.5 million, while our average cost of deposits decreased 44 basis points to 2.97% for the three months ended September 30, 2025, from 3.41% for the three months ended September 30, 2024.
Previous wording
Interest expense on Federal Home Loan Bank advances increased $295,000, or 23.4%, to $1.6 million for the three months ended March 31, 2025, from $1.3 million for the three months ended March 31, 2024. The increase was due to increases in our average balance of Federal Home Loan Bank advances ($33.1 million, or 29.7%) while our average cost of borrowings decreased 22 basis points to 4.32% for the three months ended March 31, 2025, from 4.54% for the three months ended March 31, 2024. As described above, we increased Federal Home Loan Bank borrowings in recent periods primarily to fund loan growth.
Current wording
Interest expense on Federal Home Loan Bank advances increased $72,000, or 4.9%, to $1.5 million for the three months ended September 30, 2025, from $1.5 million for the three months ended September 30, 2024. Our average balance of Federal Home Loan Bank advances increased $13.3 million, while our average cost of borrowings decreased 22 basis points to 4.32% for the three months ended September 30, 2025, from 4.54% for the three months ended September 30, 2024. The decrease in the Federal Home Loan Bank cost of funds is due to the decrease in advance rates.
Previous wording
Net Interest Income. Net interest income was $4.4 million for the three months ended March 31, 2025, compared to $3.5 million for the three months ended March 31, 2024, as our interest income increased faster than our interest expense. Our interest rate spread increased to 1.61% for the three months ended March 31, 2025 from 1.31% for the three months ended March 31, 2024. Our net interest margin increased to 2.02% for the three months ended March 31, 2025 from 1.79% for the three months ended March 31, 2024
Current wording
Net Interest Income. Net interest income was $5.7 million for the three months ended September 30, 2025, compared to $3.8 million for the three months ended September 30, 2024, as our interest income increased faster than our interest expense. Our interest rate spread increased to 1.96% for the three months ended September 30, 2025 from 1.38% for the three months ended September 30, 2024. Our net interest margin increased to 2.49% for the three months ended September 30, 2025 from 1.84% for the three months ended September 30, 2024
Previous wording
Provision for Credit Losses. Based on an analysis of the factors described in “Critical Accounting Policies—Allowance for Credit Losses,” we recorded a benefit for credit losses of $21,000 for the three months ended March 31, 2025, compared to a provision of $100,000 for the three months ended March 31, 2024. The provision for credit losses on loans for the three months ended March 31, 2025 was $15,000 primarily due to an increase in loan balances, while there was a benefit for credit losses on off balance sheet commitments of $36,000 for the same period, due to lower off balance sheet commitments.
Current wording
Provision for Credit Losses. Based on an analysis of the factors described in “Critical Accounting Policies—Allowance for Credit Losses,” we recorded a benefit for credit losses of $320,000 for the three months ended September 30, 2025, compared to a provision of $1.2 million for the three months ended September 30, 2024. The provision for credit losses on loans for the three months ended September 30, 2025 was due to an increase in loan balances and the change in ACL methodology, while there was a benefit for credit losses on off balance sheet commitments of $795,000 for the same period, due to the change in ACL methodology and lower off balance sheet commitments.
Previous wording
Gross Loans. Loans increased $45.8 million, or 6.7%, to $730.1 million at March 31, 2025 compared to $684.4 million at June 30, 2024. The primary increases were in multi-family real estate loans ($24.1 million, or 19.4%), commercial real estate loans ($16.1 million, or 18.8%), one- to four-family residential real estate loans ($6.9 million, or 2.0%), and construction loans ($1.0 million, or 0.9%). We continued our focus on originating construction and multi-family real estate loans at a higher point in the market interest rate cycle. Our strategy is to continue to grow our loan portfolio, with a focus on commercial real estate, multi-family residential real estate and construction loans, while continuing to originate single-family residential real estate loans to support local homebuyers. The recent increase in one- to four-family residential real estate loans was due to our establishing new broker relationships and our recent efforts to balance our concentration of commercial real estate loans, particularly with respect to our level of regulatory capital. The allowance for credit losses on loans was $3.6 million at March 31, 2025 and $3.5 million at June 30, 2024,and represented 0.49% and 0.50% of total loans at March 31, 2025 and June 30, 2024,, respectively. The allowance for credit losses for off balance sheet commitments was $1.0 million at March 31, 2025 and $1.2 million at June 30, 2024,. The benefit for off balance sheet commitments related to lower balances of loan commitments as the commitments were converted to loans.
Current wording
The allowance for credit losses on loans was $4.4 million at September 30, 2025 and $4.2 million at June 30, 2025, and represented 0.55% of total loans at both September 30, 2025 and June 30, 2025 . The allowance for credit losses for off balance sheet commitments was $391,000 at September 30, 2025 and $1.1 million at June 30, 2025. The benefit for off balance sheet commitments related to the change in ACL methodology and lower balances of loan commitments as the commitments were converted to loans.
Previous wording
Total nonaccrual loans were $1.9 million at March 31, 2025, compared to $1.4 million at June 30, 2024. Total loans past due 30 days or greater were $2.3 million at March 31, 2025 compared to $1.3 million at June 30, 2024. As a percentage of nonperforming loans, the allowance for credit losses on loans was 191.77% at March 31, 2025 compared to 245.44% at June 30, 2024.
Current wording
Total nonaccrual loans were $1.9 million at September 30, 2025, compared to $2.2 million at June 30, 2025. Total loans past due 30 days or greater were $1.8 million at both September 30, 2025 and June 30, 2025. As a percentage of nonperforming loans, the allowance for credit losses on loans was 224.67% at September 30, 2025 compared to 187.57% at June 30, 2025.
Previous wording
The increase in salaries and employee benefits was due to the addition of key finance staff, and higher expenses related to our health plan, while the increase in deposit insurance expense was due to an increase in FDIC insurance rates and our higher deposit levels.
Current wording
The increase in salaries and employee benefits was due to the addition of key finance staff, and higher expenses related to our health plan, while the increase in deposit insurance expense was due to an increase in FDIC insurance rates and our higher deposit levels. Increases in marketing expense were due to the launch of a new website as well as a new investor relations site.
Previous wording
Income Taxes. Income tax expense increased to $67,000 for the three months ended March 31, 2025, compared to a benefit of $19,000 for the three months ended March 31, 2024. The effective tax rates were 18.0% and (11.0%) for the three months ended March 31, 2025 and 2024, respectively, as we had lower levels of taxable income during the 2024 period.
Current wording
Income Taxes. Income tax expense increased to $356,000 for the three months ended September 30, 2025, compared to a benefit of $198,000 for the three months ended September 30, 2024. The effective tax rates were 27.0% and (23.9%) for the three months ended September 30, 2025 and 2024, respectively, as we had lower levels of taxable income during the 2024 period.
Previous wording
The tables above indicate that at March 31, 2025, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 14.5% decrease in net interest income, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 2.1% increase in net interest income and at June 30, 2024, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 22.8% decrease in net interest income, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 8.9% increase in net interest income.
Current wording
The tables above indicate that at September 30, 2025, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 16.9% decrease in net interest income, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 6.5% increase in net interest income and at June 30, 2025, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 14.3% decrease in net interest income, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 1.7% increase in net interest income.
Previous wording
The tables above indicate that at March 31, 2025, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 21.8% decrease in EVE, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 1.7% increase in EVE, and at June 30, 2024, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 33.5% decrease in EVE, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 9.6% increase in EVE.
Current wording
The tables above indicate that at September 30, 2025, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 22.7% decrease in EVE, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 9.0% increase in EVE, and at June 30, 2025, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 22.0% decrease in EVE, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 7.1% increase in EVE.
Previous wording
Liquidity is our ability to meet current and future financial obligations that arise in the ordinary course of business. Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures. Our primary sources of funds are deposits, principal and interest payments on loans and securities and proceeds from maturities and calls of securities. We also have the ability to borrow from the Federal Home Loan Bank of Boston. At March 31, 2025, we had $131.0 million outstanding in advances from the Federal Home Loan Bank of Boston. At March 31, 2025, we had the ability to borrow $125.0 million in additional Federal Home Loan Bank of Boston advances. At March 31, 2025, we had a $5.3 million line of credit with the Federal Home Loan Bank of Boston, which was not drawn at March 31, 2025. Additionally, at March 31, 2025, we had a $11.1 million secured line of credit through the Federal Reserve Borrower in Custody program. At that date, there were no amounts outstanding.
Current wording
Liquidity is our ability to meet current and future financial obligations that arise in the ordinary course of business. Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures. Our primary sources of funds are deposits, principal and interest payments on loans and securities and proceeds from maturities and calls of securities. We also have the ability to borrow from the Federal Home Loan Bank of Boston. At September 30, 2025, we had $164.0 million outstanding in advances from the Federal Home Loan Bank of Boston. At September 30, 2025, we had the ability to borrow $147.3 million in additional Federal Home Loan Bank of Boston advances. At September 30, 2025, we had a $5.3 million line of credit with the Federal Home Loan Bank of Boston, which was not drawn at September 30, 2025. Additionally, at September 30, 2025, we had a $66.7 million secured line of credit through the Federal Reserve Borrower in Custody program. At that date, there were no amounts outstanding.
Previous wording
We seek to maintain a minimum monthly liquidity ratio of 4% to 6% of assets, and a minimum quarterly Primary Liquidity ratio of 15%. At March 31, 2025 and June 30, 2024, we were in compliance with both of these guidelines.
Current wording
We seek to maintain a minimum monthly liquidity ratio of 4% to 6% of assets, and a minimum quarterly Primary Liquidity ratio of 10%. At September 30, 2025 and June 30, 2025, we were in compliance with both of these guidelines.
Previous wording
Our cash flows are comprised of three primary classifications: cash flows from operating activities, investing activities, and financing activities. Net cash provided by (used in) operating activities was $571,000 and $447,000 for the nine months ended March 31, 2025 and 2024, respectively. Net cash used by investing activities, which consists primarily of disbursements for loan originations and the purchase of investment securities, offset by principal collections on loans and proceeds from maturing securities and pay downs on securities, was $47.5 million and $75.1 million for the nine months ended March 31, 2025 and 2024, respectively. Net cash provided by financing activities was $69.4 million and $64.0 million for the nine months ended March 31, 2025 and 2024, respectively.
Current wording
Our cash flows are comprised of three primary classifications: cash flows from operating activities, investing activities, and financing activities. Net cash provided by (used in) operating activities was $1.4 million and ($334,000) for the three months ended September 30, 2025 and 2024, respectively. Net cash used by investing activities, which consists primarily of disbursements for loan originations and the purchase of investment securities, offset by principal collections on loans and proceeds from maturing securities and pay downs on securities, was $53.3 million and $27.1 million for the three months ended September 30, 2025 and 2024, respectively. Net cash provided by financing activities was $54.4 million and $20.5 million for the three months ended September 30, 2025 and 2024, respectively.
Previous wording
The net proceeds from the offering will significantly increase our liquidity and capital resources. Over time, the initial level of liquidity will be reduced as net offering proceeds are used for general corporate purposes, including funding loans. Our financial condition and results of operations will be enhanced by the net proceeds from the offering, which will increase our net interest-earning assets and net interest income. However, due to the increase in equity resulting from the net proceeds, as well as other factors associated with the offering, our return on equity will be lower immediately following the offering.
Current wording
The net proceeds from the offering significantly increased our liquidity and capital resources. Over time, the initial level of liquidity will be reduced as net offering proceeds are used for general corporate purposes, including funding loans. Our financial condition and results of operations will be enhanced by the net proceeds from the offering, which will increase our net interest-earning assets and net interest income. However, due to the increase in equity resulting from the net proceeds, as well as other factors associated with the offering, our return on equity may remain lower in the immediate future.
Rearranged previous paragraphs (7)
Previous report — wording carried elsewhere
Comparison of Operating Results for the Nine Months ended March 31, 2025 and 2024
Previous report — wording carried elsewhere
The average balance of loans increased by $80.3 million, or 12.6%, to $717.4 million for the nine months ended March 31, 2025, over the average balance for the nine months ended March 31, 2024, while the average yield on loans increased by 47 basis points to 5.16% for the nine months ended March 31, 2025, from 4.69% for the nine months ended March 31, 2024. The increase in the average yield was due to increases in market interest rates as well as changes in the composition of our loan portfolio to include a higher percentage of higher yielding construction and commercial real estate loans, as well as multi-family residential real estate loans. The increase in average balance was due to our continuing to pursue new commercial relationships.
Previous report — wording carried elsewhere
Our estimates and assumptions used in the determination of the adequacy of the allowance could be proven incorrect in the future, and the actual amount of future provisions may exceed the amount of past provisions. Any such increase in future provisions that may be required may adversely impact our financial condition and results of operations.
Previous report — wording carried elsewhere
The increase in deposit insurance expense was due to an increase in FDIC insurance rates and our higher deposit levels. The increase in salaries and employee benefits was due to the addition of key staff in finance and other areas, while the increase in data processing expense was due to our implementing a new program for electronic communications and online account opening.
Previous report — wording carried elsewhere
The following tables set forth average balance sheets, average yields and costs, and certain other information for the periods indicated. No tax-equivalent yield adjustments have been made, as the effects would be immaterial. All average balances are daily average balances, and the average balance of loans includes non-accrual loans. The yields set forth below
Previous report — wording carried elsewhere
include the effect of deferred fees/costs, discounts, and premiums that are amortized or accreted to interest income. Deferred loan fees for the nine months ended March 31, 2025 and 2024 were not material.
Previous report — wording carried elsewhere
The following table presents the effects of changing rates and volumes on our net interest income for the periods indicated. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The total column represents the sum of the prior columns. For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately based on the changes due to rate and the changes due to volume. There were no out-of-period items or adjustments required to be excluded from the table below.