Ponce Financial Group, Inc.

Previous wording

Management’s discussion and analysis of the financial condition at September 30, 2025 and December 31, 2024, and results of operations for the three and nine months ended September 30, 2025 and 2024, is intended to assist in understanding the financial condition and results of operations of Ponce Financial Group, Inc. (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 the financial condition at March 31, 2026 and December 31, 2025, and results of operations for the three months ended March 31, 2026 and 2025, is intended to assist in understanding the financial condition and results of operations of Ponce Financial Group, Inc. (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

demand for loans and deposits in the market area;

Current wording

demand for loans and deposits in the market areas;

Previous wording

technological changes that may be more difficult or expensive than expected;

Current wording

technological changes that may be more difficult or expensive than expected; and cyber threats, attacks or events;

Previous wording

the Company’s compensation expense associated with equity allocated or awarded to its employees; and

Current wording

the Company’s compensation expense associated with equity allocated or awarded to its employees;

Previous wording

On June 7, 2022 (the “Original Closing Date”), the Company issued 225,000 shares of the Company’s Preferred Stock‎, par value $0.01 (the “Preferred Stock”) for an aggregate purchase price equal to $225,000,000 in cash to the Treasury, pursuant to the Treasury’s ECIP. Under the ECIP, Treasury provided investment capital directly to depository institutions that are CDFIs or MDIs or their holding companies, to provide loans, grants, and forbearance for small businesses, minority-owned businesses, and consumers, in low-income and underserved communities. No dividends accrued or were due for the first two years after issuance. For years three through ten, depending upon the level of qualified and/or deep impact lending made in targeted communities, as defined in the ECIP guidelines, dividends will be at an annual rate of either 2.0%, 1.25% or 0.5% and, thereafter, will be fixed at one of the foregoing rates. If we are unable to make qualified and/or deep impact loans at required levels, we will be required to pay dividends at the higher annual rates. Additionally, we may make qualified and/or deep impact loans that are riskier than we otherwise would in an effort to meet the lending requirements for the lower dividend rates and/or to qualify for the purchase option under the Repurchase Agreement (as described below).

Current wording

On June 7, 2022 (the “Original Closing Date”), the Company issued 225,000 shares of the Company’s Preferred Stock‎, par value $0.01 (the “Preferred Stock”) for an aggregate purchase price equal to $225,000,000 in cash to the Treasury, pursuant to the Treasury’s ECIP. Under the ECIP, Treasury provided investment capital directly to depository institutions that are CDFIs or MDIs or their holding companies, to provide loans, grants, and forbearance for small businesses, minority-owned businesses, and consumers, in low-income and underserved communities. No dividends accrued or were due for the first two years after issuance. For years three through ten, depending upon the level of qualified and/or deep impact lending made in targeted communities, as defined in the ECIP guidelines, dividends will be at an annual rate of either 2.0%, 1.25% or 0.5% and, thereafter, will be fixed at one of the foregoing rates. If we are unable to make qualified and/or deep impact loans at required levels, we will be required to pay dividends at the higher annual rates.

Previous wording

As a participant in the ECIP, the Company must comply with certain operating requirements. Specifically, the Company must adopt the Treasury's standards for executive compensation and luxury expenses for the period during which the Treasury holds equity issued under the ECIP. These restrictions may make it difficult to adequately compensate our management team, which could impact our ability to retain qualified management. Additionally, under the ECIP regulations, the Company cannot pay dividends or repurchase its common stock unless it meets certain income-based tests and has paid the required dividends on the Preferred Stock. In June 2024, the Company began paying dividends on its Preferred Stock, which dividends were $0.8 million for the nine months ended September 30, 2025 and $0.6 million for the year ended December 31, 2024.

Current wording

As a participant in the ECIP, the Company must comply with certain operating requirements. Specifically, the Company must adopt the Treasury's standards for executive compensation and luxury expenses for the period during which the Treasury holds equity issued under the ECIP. These restrictions may make it difficult to adequately compensate our management team, which could impact our ability to retain qualified management. Additionally, under the ECIP regulations, the Company cannot pay dividends or repurchase its common stock unless it meets certain income-based tests and has paid the required dividends on the Preferred Stock. In June 2024, the Company began paying dividends on its Preferred Stock, which dividends were $0.3 million for the three months ended March 31, 2026 and $1.1 million for the year ended December 31, 2025.

Previous wording

Stock during the Option Period, which is the first fifteen years following the Original Closing Date. The purchase price for the Preferred Stock pursuant to the purchase option is determined based on a formula equal to the present value of the Preferred Stock, calculated as set forth in the Repurchase Agreement, together with any accrued and unpaid dividends thereon, as of the closing date. Subject to variations in interest rates and the equity risk premium, which are components included in the purchase price calculation, the Company presently expects that the purchase price will be at a substantial discount from the face value of the Preferred Stock.

Current wording

On December 20, 2024, the Company entered into an ECIP Securities Purchase Option Agreement (the “Repurchase Agreement”) with Treasury. Pursuant to the Repurchase Agreement, Treasury has granted the Company an option to purchase all of the Preferred Stock during the Option Period, which is the first fifteen years following the Original Closing Date. The purchase price for the Preferred Stock pursuant to the purchase option is determined based on a formula equal to the present value of the Preferred Stock, calculated as set forth in the Repurchase Agreement, together with any accrued and unpaid dividends thereon, as of the closing date. Subject to variations in interest rates and the equity risk premium, which are components included in the purchase price calculation, the Company presently expects that the purchase price will be at a substantial discount from the face value of the Preferred Stock.

Previous wording

The earliest possible date by which a Threshold Condition may be met is June 30, 2026, which is the end of the sixteenth consecutive quarter following the Original Closing Date. However, the Company does not currently meet any of the Threshold Conditions to exercise the purchase option, and there can be no assurance if and when the Threshold Conditions will be met. The closing of the repurchase of the Preferred Stock, if consummated, would occur between thirty and ninety days following the satisfaction of the Threshold Condition and all other applicable conditions. At present, the Company has reported 13 consecutive quarters for which it has met both the Deep Impact and Qualified Lending Conditions. The Preferred Stock currently has a dividend rate of 0.5%.

Current wording

The earliest possible date by which a Threshold Condition may be met is June 30, 2026, which is the end of the sixteenth consecutive quarter following the Original Closing Date. However, the Company does not currently meet any of the Threshold Conditions to exercise the purchase option, and there can be no assurance if and when the Threshold Conditions will be met. The closing of the repurchase of the Preferred Stock, if consummated, would occur between thirty and ninety days following the satisfaction of the Threshold Condition and all other applicable conditions. At present, the Company has reported 15 consecutive quarters for which it has met both the Deep Impact and Qualified Lending Conditions. The Preferred Stock currently has a dividend rate of 0.5%.

Previous wording

In addition to the requirement that a Threshold Condition be met, the Repurchase Agreement requires that the Company meet certain other eligibility conditions in order to exercise the purchase option in the future, including compliance with the terms of the original ECIP purchase agreement and the terms of the Preferred Stock, maintaining qualification as either a CDFI or an MDI, and meeting other legal and regulatory criteria. Although the Company currently meets the general eligibility criteria, other than satisfying one of the Threshold Conditions, there can be no assurance that the Company will meet such criteria in the future.

Current wording

In addition to the requirement that a Threshold Condition be met, the Repurchase Agreement requires that the Company meet certain other eligibility conditions in order to exercise the purchase option in the future, including compliance with the terms of the original ECIP purchase agreement and the terms of the Preferred Stock, maintaining qualification as either a CDFI or an MDI, and meeting other legal and regulatory criteria. Although the Company currently meets the general eligibility criteria, other than satisfying one of the Threshold Conditions, there can be no assurance that the Company will meet such criteria, or any amended or additional criteria that may be imposed, in the future.

Previous wording

The Ponce Bank Westchester Avenue Branch located at 2244 Westchester Avenue in the Castle Hill area of the Bronx was approved as a Banking Development District ("BDD"). New York State’s BDD Program, administered by the Department of Financial Services ("DFS"), supports the establishment of bank and credit union branches in areas across New York State where there is a demonstrated need for banking services. To encourage participation, approved BDD branches receive access to subsidized and market rate deposits from New York State. On July 30, 2024, Ponce Bank received total program deposits of $35.0 million. On June 24, 2025, the Bank received an additional $10.0 million from the New York City Department of Finance resulting in a total BDD Program deposit of $45.0 million.

Current wording

The Bank's Westchester Avenue Branch located at 2244 Westchester Avenue in the Castle Hill area of the Bronx was approved as a Banking Development District ("BDD"). New York State’s BDD Program, administered by the Department of Financial Services ("DFS"), supports the establishment of bank and credit union branches in areas across New York State where there is a demonstrated need for banking services. To encourage participation, approved BDD branches receive access to subsidized and market rate deposits from New York State. On July 30, 2024, Ponce Bank received total program deposits of $35.0 million. On June 24, 2025, the Bank received an additional $10.0 million from the New York City Department of Finance resulting in a total BDD Program deposit of $45.0 million.

Previous wording

The Company continues its relationship with Raisin Solutions US LLC ("Raisin"), a fintech that focuses on gathering deposits for financial institutions through the Internet. As of September 30, 2025 and December 31, 2024, the Company had $639.1 million and $574.1 million, respectively, in such deposits, which the Company classifies as core deposits.

Current wording

The Company continues its relationship with Raisin Solutions US LLC ("Raisin"), a fintech that focuses on gathering deposits for financial institutions through the Internet. As of March 31, 2026 and December 31, 2025, the Company had $678.4 million and $643.9 million, respectively, in such deposits, which the Company classifies as core deposits.

Previous wording

At December 31, 2018, the first year after our initial public offering, the Company had approximately $1.06 billion in assets, $918.5 million in loans, net of allowance for credit losses of $12.7 million, and $809.8 million in deposits. The Company has since grown to $3.16 billion in assets, $2.49 billion in loans receivables, net of allowance for credit losses of $24.8 million, and $2.06 billion in deposits at September 30, 2025, all while investing in infrastructure, implementing digital banking and diversifying its product offering. Now, the Company believes that it is poised to enhance its presence, locally and in similar communities outside New York, as a leading CDFI and MDI financial institution holding company.

Current wording

At December 31, 2018, the first year after our initial public offering, the Company had approximately $1.06 billion in assets, $918.5 million in loans, net of allowance for credit losses of $12.7 million, and $809.8 million in deposits. The Company has since grown to $3.30 billion in assets, $2.70 billion in loans, net of allowance for credit losses of $26.2 million, and $2.13 billion in deposits at March 31, 2026, all while investing in infrastructure, implementing digital banking and diversifying its product offering. Now, the Company believes that it is poised to enhance its presence, locally and in similar communities outside New York, as a leading CDFI and MDI financial institution holding company.

Previous wording

Total Assets. Total consolidated assets increased $117.1 million, or 3.9%, to $3.16 billion at September 30, 2025 from $3.04 billion at December 31, 2024. The increase in total assets is largely attributable to increases of $203.4 million in net loans receivable, $8.1 million in other assets, $6.7 million in cash and cash equivalents, $1.1 million in accrued interest receivable and $0.3 million in deferred tax asset, partially offset by decreases of $82.8 million in held-to-maturity securities, $10.1 million in available-for-sale securities, $4.9 million in mortgage loans held for sale, $3.2 million in Federal Home Loan Bank of New York stock, $0.8 million in right of use asset and $0.7 million in premises and equipment, net.

Current wording

Total Assets. Total consolidated assets increased $76.8 million, or 2.4%, to $3.30 billion at March 31, 2026 from $3.22 billion at December 31, 2025. The increase in total assets is largely attributable to increases of $99.4 million in net loans receivable, $2.0 million in other assets, $1.4 million in accrued interest receivable and $0.2 million in deferred tax assets, partially offset by decreases of $9.5 million in held-to-maturity securities, $8.9 million in cash and cash equivalents, $5.0 million in available-for-sale securities, $1.3 million in mortgage loans held for sale, $1.1 million in Federal Home Loan Bank of New York stock and $0.5 million in premises and equipment, net.

Previous wording

Cash and Cash Equivalents. Cash and cash equivalents increased $6.7 million, or 4.8%, to $146.6 million at September 30, 2025, compared to $139.8 million at December 31, 2024. The increase in cash and cash equivalents was primarily the result of an increase of $167.9 million in net deposits, $97.7 million in proceeds from maturities, calls and principal repayment on securities, $6.7 million from sale of loans and $3.2 million in net redemption of FHLBNY stock. The increase in cash and cash equivalents was offset primarily by an increase of $212.7 million in net loans and $75.0 million in net repayment of borrowings.

Current wording

Cash and Cash Equivalents. Cash and cash equivalents decreased $8.9 million, or 7.1%, to $117.2 million at March 31, 2026, compared to $126.2 million at December 31, 2025. The decrease in cash and cash equivalents was primarily the result of an increase of $101.8 million in net loans and $25.0 million in net repayment of borrowings, increases of $2.0 million in other assets and $1.4 million in accrued interest receivable. The decrease in cash and cash equivalents was offset primarily by an increase of $87.2 million in net deposits, $14.7 million in proceeds from maturities, calls and principal repayment on securities, an increase of $3.8 million in other liabilities, decreases of $1.4 million in loans held for sale and $1.1 million from sale of loans.

Previous wording

Securities. The Company securities portfolio decreased $10.1 million, or 9.7%, to $94.8 million in available-for-sale at September 30, 2025 from $105.0 million December 31, 2024 and decreased $82.8 million, or 22.5%, to $285.1 million in held-to-maturity at September 30, 2025 from $367.9 million at December 31, 2024. The decrease in the securities portfolio was primarily due to three available-for-sale securities in the total amount of $7.0 million and three held-to-maturity securities in the total amount of $50.0 million that matured and/or were called and changes in principal amount of the securities.

Current wording

Securities. The Company securities portfolio decreased $5.0 million, or 5.5%, to $87.2 million in available-for-sale at March 31, 2026 from $92.2 million December 31, 2025 and decreased $9.5 million, or 3.5%, to $263.5 million in held-to-maturity at March 31, 2026 from $273.0 million at December 31, 2025. The decrease in the securities portfolio was primarily due to regular principal payments and the maturity of one available-for-sale security in the amount of $3.0 million.

Previous wording

The following table presents non-interest income for the periods indicated:

Current wording

Portfolio Maturities and Yields. The composition and maturities of the investment securities portfolio at March 31, 2026 are summarized in the following table. Maturities are based on the final contractual payment dates, and do not reflect the effect of scheduled principal repayments, prepayments, or early redemptions that may occur. Adjustable-rate mortgage-backed securities are included in the period in which interest rates are next scheduled to adjust. The weighted average yield is calculated based on the yield to maturity weighted for the size of each debt security over the entire portfolio of debt securities. The weighted average yields on tax-exempt obligations have been computed on a tax-equivalent basis.

Previous wording

Based on current internal loan reviews, the Company believes that the quality of our underwriting, our weighted average loan-to-value ratio of 49.3% and our customer selection processes have served us well and provided us with a reliable base with which to maintain a well-protected loan portfolio.

Current wording

Based on current internal loan reviews, the Company believes that the quality of our underwriting, our weighted average loan-to-value ratio of 50.5% and our customer selection processes have served us well and provided us with a reliable base with which to maintain a well-protected loan portfolio.

Previous wording

Multifamily residential loans increased $18.4 million, or 2.7%, when compared to December 31, 2024. The majority of the increases in multifamily residential loans that were refinanced from construction and land loans to a new permanent loan facility.

Current wording

Multifamily residential loans increased $158.8 million, or 21.0%, when compared to December 31, 2025. The majority of the increases in multifamily residential loans that were refinanced from construction and land loans to a new permanent loan facility.

Previous wording

Construction and land loans increased $152.7 million, or 20.8%, when compared to December 31, 2024. The $152.7 million growth in construction and land mortgage loans is related to funding of existing commitments prior to 2025 and new commitments, offset by loans that were refinanced from construction and land loans to new permanent loan facilities.

Current wording

Construction and land loans decreased $90.1 million, or 10.5%, when compared to December 31, 2025. The $90.1 million decrease in construction and land mortgage loans is related to loans that were refinanced from construction and land loans to new permanent loan facilities, offset by funding of existing commitments prior to 2026 and new commitments.

Previous wording

Our commitments to grant new mortgage loans decreased by $88.2 million as of September 30, 2025 compared to December 31, 2024. See Note 10 ("Commitments, Contingencies and Credit Risk") of Notes to the Consolidated Financial Statements.

Current wording

Our commitments to grant new mortgage loans increased by $48.1 million as of March 31, 2026 compared to December 31, 2025. See Note 10 ("Commitments, Contingencies and Credit Risk") of Notes to the Consolidated Financial Statements.

Previous wording

The Company had 70 construction and land mortgage loans with balances of $886.4 million as indicated in the table above. Of those loans, 38 loans with aggregate balances of $599.6 million, or 67.7%, of the total, have a percentage of completion of 80% or more. Within those 38 loans there are 20 loans with balances of $328.6 million that are 100% completed and the properties have received their certificates of occupancy.

Current wording

The Company had 68 construction and land mortgage loans with balances of $764.0 million as indicated in the table above. Of those loans, 29 loans with aggregate balances of $380.2 million, or 49.8%, of the total, have a percentage of completion of 80% or more. Within those 29 loans there are 14 loans with balances of $193.3 million that are 100% completed and 13 of these properties received their certificates of occupancy.

Previous wording

Commercial real estate loans, as defined by applicable banking regulations, include multifamily residential, nonresidential properties, and construction and land mortgage loans. At September 30, 2025 and December 31, 2024, approximately 3.4% and 3.5%, respectively, of the outstanding principal balance of the Bank’s commercial real estate mortgage loans were secured by owner-occupied commercial real estate. Owner-occupied commercial real estate is similar in many ways to commercial and industrial lending in that these loans are generally made to businesses predominantly on the basis of the cash flows of the business rather than on valuation of the real estate.

Current wording

Commercial real estate loans, as defined by applicable banking regulations, include multifamily residential, nonresidential properties, and construction and land mortgage loans. At March 31, 2026 and December 31, 2025, approximately 2.9% and 3.1%, respectively, of the outstanding principal balance of the Bank’s commercial real estate mortgage loans were secured by owner-occupied commercial real estate. Owner-occupied commercial real estate is similar in many ways to commercial and industrial lending in that these loans are generally made to businesses predominantly on the basis of the cash flows of the business rather than on valuation of the real estate.

Previous wording

Banking regulations have established guidelines relating to the amount of construction and land mortgage loans and investor- owned commercial real estate mortgage loans of 100% and 300% of total risk-based capital, respectively. Should a bank’s ratios be in excess of these guidelines, banking regulations generally require an increased level of monitoring in these lending areas by bank management. The Bank’s policy is to operate within the 200% guideline for construction and land mortgage loans and up to 450% for investor-owned commercial real estate mortgage loans. Both ratios are calculated by dividing certain types of loan balances for each of the two categories by the Bank’s total risk-based capital. At September 30, 2025 and December 31, 2024, the Bank’s construction and land mortgage loans as a percentage of total risk-based capital was 167.0% and 145.0%, respectively. Investor-owned commercial real estate mortgage loans as a percentage of total risk-based capital was 366.1% and 341.7% as of September 30, 2025 and December 31, 2024, respectively. At September 30, 2025, the Bank was above the 100% guidelines established by the banking regulations and under the 200% guidelines set by the Bank for construction and land mortgage loans and above the 300% guideline established by banking regulators but under the 450% guidelines set by the Bank for investor owned commercial real estate mortgage loans. Management believes that it has established the appropriate level of controls to monitor the Bank’s lending in these areas.

Current wording

Banking regulations have established guidelines relating to the amount of construction and land mortgage loans and investor- owned commercial real estate mortgage loans of 100% and 300% of total risk-based capital, respectively. Should a bank’s ratios be in excess of these guidelines, banking regulations generally require an increased level of monitoring in these lending areas by bank management. The Bank’s policy is to operate within the 200% guideline for construction and land mortgage loans and up to 450% for investor-owned commercial real estate mortgage loans. Both ratios are calculated by dividing certain types of loan balances for each of the two categories by the Bank’s total risk-based capital. At March 31, 2026 and December 31, 2025, the Bank’s construction and land mortgage loans as a percentage of total risk-based capital was 137.2% and 156.7%, respectively. Investor-owned commercial real estate mortgage loans as a percentage of total risk-based capital was 399.0% and 393.1% as of March 31, 2026 and December 31, 2025, respectively. At March 31, 2026, the Bank was above the 100% guidelines established by the banking regulations and under the 200% guidelines set by the Bank for construction and land mortgage loans and above the 300% guideline established by banking regulators but under the 450% guidelines set by the Bank for investor owned commercial real estate mortgage loans. Management believes that it has established the appropriate level of controls to monitor the Bank’s lending in these areas.

Previous wording

Loans Held For Sale. Loans held for sale, at fair value, at September 30, 2025 decreased $4.9 million, or 46.0%, to $5.8 million from $10.7 million at December 31, 2024.

Current wording

Loans Held For Sale. Loans held for sale, at fair value, at March 31, 2026 decreased $1.3 million, or 37.2%, to $2.1 million from $3.4 million at December 31, 2025.

Previous wording

At September 30, 2025 and December 31, 2024, there were no individual listing service deposits amounting to $250,000 or more. There was one brokered certificates of deposit in the amount of $1.5 million amounting to $250,000 or more. All other brokered certificates of deposit individually amounted to less than $250,000.

Current wording

At March 31, 2026 and December 31, 2025, there were no individual listing service deposits amounting to $250,000 or more. All other brokered certificates of deposit individually amounted to less than $250,000.

Previous wording

Borrowings. The Bank had outstanding borrowings at September 30, 2025 and December 31, 2024 of $521.1 million and $571.1 million in term advances from the FHLBNY. The Bank had no overnight line of credit advance from the FHLBNY at September 30, 2025 and had one overnight line of credit advance in the amount of $25.0 million from the FHLBNY at December 31, 2024. Additionally, the Bank had two unsecured lines of credit in the amount of $75.0 million with two correspondent banks for both periods at September 30, 2025 and December 31, 2024. The Bank did not have any term and overnight line of credit advances from the FRBNY at September 30, 2025 and December 31, 2024.

Current wording

Borrowings. The Bank had outstanding borrowings at March 31, 2026 and December 31, 2025 of $571.1 million and $596.1 million in term advances from the FHLBNY. The Bank had no overnight line of credit advance from the FHLBNY at March 31, 2026 and December 31, 2025. Additionally, the Bank had two unsecured lines of credit in the amount of $75.0 million with two correspondent banks for both periods at March 31, 2026 and December 31, 2025. The Bank did not have any term and overnight line of credit advances from the FRBNY at March 31, 2026 and December 31, 2025.

Previous wording

Stockholders’ Equity. The Company’s consolidated stockholders’ equity increased $24.3 million, or 4.8%, to $529.8 million as of September 30, 2025 from $505.5 million as of December 31, 2024. The $24.3 million increase in stockholders’ equity was largely attributable to $18.6 million in net income, $3.7 million in other comprehensive income, $1.4 million impact to additional paid in capital as a result of share-based compensation, $1.4 million from release of ESOP shares and $0.1 million from exercise of stock options, offset by $0.8 million in dividends on preferred shares.

Current wording

Stockholders’ Equity. The Company’s consolidated stockholders’ equity increased $9.8 million, or 1.8%, to $551.4 million as of March 31, 2026 from $541.5 million as of December 31, 2025. The $9.8 million increase in stockholders’ equity was largely attributable to $8.6 million in net income, $0.6 million impact to additional paid in capital as a result of share-based compensation, $0.6 million from release of ESOP shares and $0.2 million from exercise of stock options and $0.1 million in other comprehensive income, offset by $0.3 million related to dividend paid on preferred shares during the three months ended March 31, 2026.

Previous wording

Overview. Net income available to common stockholders was $17.7 million for the nine months ended September 30, 2025 compared to net income available to common stockholders of $7.7 million for the nine months ended September 30, 2024. Earnings per basic share was $0.78 and diluted share was $0.77 for the nine months ended September 30, 2025 compared to earnings per basic and diluted share of $0.34 for nine months ended September 30, 2024. The $10.0 million increase of net income available to common stockholders from the nine months ended September 30, 2024, was due to increases of $16.1 million in net interest income and $0.8 million in non-interest income, partially offset by increases of $3.1 million in provision for credit losses, $3.0 million in provision for income taxes, $0.5 million in dividends on preferred shares and $0.4 million in non-interest expense. Net income for the nine months ended September 30, 2025 and 2024, which excludes $0.8 million and $0.4 million in dividends on preferred shares, was $18.6 million and $8.0 million, respectively.

Current wording

Overview. Net income available to common stockholders was $8.3 million for the three months ended March 31, 2026 compared to net income available to common stockholders of $5.7 million for the three months ended March 31, 2025. Earnings per basic and diluted share was $0.36 for the three months ended March 31, 2026 compared to earnings per basic and diluted share of $0.25 for the three months ended March 31, 2025. The $2.7 million increase of net income available to common stockholders from the three months ended March 31, 2025, was due to increases of $6.0 million in net interest income, partially offset by increases of $1.9 million in provision for credit losses, $0.7 million in provision for income taxes, $0.4 million in non-interest expense and a decrease of $0.3 million in non-interest income. Net income for the three months ended March 31, 2026 and 2025, which excludes $0.3 million and $0.3 million, respectively, in dividends on preferred shares, were $8.6 million and $6.0 million, respectively.

Previous wording

Interest and Dividend Income. Interest and dividend income increased $5.6 million, or 13.5%, to $46.8 million for the three months ended September 30, 2025 from $41.3 million for the three months ended September 30, 2024. Interest income on loans receivable, which is the Company’s primary source of income, increased $8.5 million, or 25.9%, to $41.5 million for the three months ended September 30, 2025 from $32.9 million for the three months ended September 30, 2024.

Current wording

Interest and Dividend Income. Interest and dividend income increased $4.7 million, or 10.6%, to $48.7 million for the three months ended March 31, 2026 from $44.0 million for the three months ended March 31, 2025. Interest income on loans receivable, which is the Company’s primary source of income, increased $6.8 million, or 18.4%, to $44.0 million for the three months ended March 31, 2026 from $37.1 million for the three months ended March 31, 2025.

Previous wording

Total interest and dividend income on securities, FHLBNY stock and deposits due from banks decreased $3.0 million, or 35.8%, to $5.4 million for the three months ended September 30, 2025 from $8.3 million for the three months ended September 30, 2024. The decrease was primarily attributable to a decrease of $1.5 million in interest on securities and $1.5 million in interest on deposits due from banks.

Current wording

Total interest and dividend income on securities, FHLBNY stock and deposits due from banks decreased $2.2 million or 31.8%, to $4.7 million for the three months ended March 31, 2026 from $6.9 million for the three months ended March 31, 2025. The decrease was primarily attributable to decreases of $1.3 million in interest on securities and $0.9 million in interest on deposits due from banks.

Previous wording

Interest Expense. Interest expense decreased $0.7 million, or 3.0%, to $21.6 million for the three months ended September 30, 2025 from $22.3 million for the three months ended September 30, 2024.

Current wording

Interest Expense. Interest expense decreased $1.4 million, or 6.2%, to $20.4 million for the three months ended March 31, 2026 from $21.8 million for the three months ended March 31, 2025.

Previous wording

Net Interest Income. Net interest income increased $6.2 million, or 32.7%, to $25.2 million for the three months ended September 30, 2025 from $19.0 million for the three months ended September 30, 2024. The $6.2 million increase in net interest income for the three months ended September 30, 2025 compared to the three months ended September 30, 2024 was attributable to an increase of $5.6 million in total interest and dividend income primarily due to increases in average loans receivable and a decrease of $0.7 million in interest expense due primarily to a higher average cost of funds on interest bearing liabilities.

Current wording

Net Interest Income. Net interest income increased $6.0 million, or 27.1%, to $28.2 million for the three months ended March 31, 2026 from $22.2 million for the three months ended March 31, 2025. The $6.0 million increase in net interest income for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was attributable to an increase of $4.7 million in total interest and dividend income primarily due to increases in average loans receivable and a decrease of $1.4 million in interest expense due primarily to a lower average cost of funds on interest bearing liabilities.

Previous wording

Net interest rate spread increased by 74 basis points to 2.51% for the three months ended September 30, 2025 from 1.77% for the three months ended September 30, 2024. The increase in the net interest rate spread for the three months ended September 30, 2025 compared to the three months ended September 30, 2024 was primarily due to an increase in the average yields on interest-earning assets of 37 basis points to 6.12% for the three months ended September 30, 2025 from 5.75% for the three months ended September 30, 2024, and a decrease in the average rates paid on interest-bearing liabilities of 37 basis points to 3.61% for the three months ended September 30, 2025 from 3.98% for the three months ended September 30, 2024.

Current wording

Net interest rate spread increased by 66 basis points to 2.85% for the three months ended March 31, 2026 from 2.19% for the three months ended March 31, 2025. The increase in the net interest rate spread for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was primarily due to an increase in the average yields on interest-earning assets of 32 basis points to 6.23% for the three months ended March 31, 2026 from 5.90% for the three months ended March 31, 2025, and a decrease in the average rates paid on interest-bearing liabilities of 33 basis points to 3.38% for the three months ended March 31, 2026 from 3.71% for the three months ended March 31, 2025.

Previous wording

Net interest margin increased 65 basis points for the three months ended September 30, 2025, to 3.30% from 2.65% for the three months ended September 30, 2024.

Current wording

Net interest margin increased 63 basis points for the three months ended March 31, 2026, to 3.61% from 2.98% for the three months ended March 31, 2025.

Previous wording

Non-Interest Income. Non-interest income increased $0.3 million, or 29.6%, to $1.5 million for the three months ended September 30, 2025 from $1.2 million for the three months ended September 30, 2024. The $0.3 million increase in non-interest income for the three months ended September 30, 2025 compared to the three months ended September 30, 2024 was largely attributable to increases of $0.4 million in grant income and $0.3 million in late and prepayment charges, partially offset by a decrease of $0.4 million in other non-interest income attributable to the Bank's investment in Oaktree as a result of a loss from Oaktree's investment.

Current wording

Non-Interest Income. Non-interest income decreased $0.3 million, or 14.2%, to $2.0 million for the three months ended March 31, 2026 from $2.4 million for the three months ended March 31, 2025. The $0.3 million decrease in non-interest income for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was largely attributable to a decrease of $0.4 million in income of sale of SBA loans.

Previous wording

Non-Interest Expense. Non-interest expense increased $0.4 million, or 0.8%, to $50.4 million for the nine months ended September 30, 2025 from $50.0 million for the nine months ended September 30, 2024. The $0.4 million increase in non-interest expense for the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024 was primarily attributable to increases of $0.7 million in occupancy and equipment, $0.4 million in data processing expenses and $0.4 million in other operating expense, partially offset by decreases of $1.2 million in direct loan expenses and $0.3 million in professional fees.

Current wording

Non-Interest Expense. Non-interest expense increased $0.4 million, or 2.1%, to $17.2 million for the three months ended March 31, 2026 from $16.9 million for the three months ended March 31, 2025. The $0.4 million increase in non-interest expense was mainly attributable to increases of $0.8 million in compensation and benefit and $0.1 million in marketing and promotional expenses, partially offset by decreases of $0.3 million in direct loan expenses, $0.2 million in occupancy and equipment and $0.2 million in other operating expenses.

Previous wording

Income Tax Provision. The Company had a provision for income taxes of $2.3 million for the three months ended September 30, 2025 compared to a provision for income taxes of $0.6 million for the three months ended September 30, 2024.

Current wording

Income Tax Provision. The Company had a provision for income taxes of $2.7 million for the three months ended March 31, 2026 compared to a provision for income taxes of $2.0 million for the three months ended March 31, 2025.

Previous wording

Credit Quality. Total non-performing assets and accruing modifications to borrowers experiencing financial difficulty, including loans held for sale, increased $0.3 million to $32.4 million at September 30, 2025 from $32.1 million at December 31, 2024.

Current wording

Credit Quality. Total non-performing assets and accruing modifications to borrowers experiencing financial difficulty were $23.6 million at March 31, 2026 compared to $30.2 million at December 31, 2025 and $32.0 million at March 31, 2025.

Previous wording

During the nine months ended September 30, 2025, a credit loss provision of $2.7 million on loans was recorded, consisting of $2.9 million charged on the funded portion and a benefit of $0.2 million on the unfunded portion on loans. During the nine months ended September 30, 2024, a credit loss benefit of $0.2 million on loans was recorded, consisting of $0.4 million charged on the funded portion on loans and a benefit of $0.6 million on unfunded portion on loans.

Current wording

During the three months ended March 31, 2026, a credit loss provision of $1.7 million on loans was recorded, consisting of $1.3 million charged on the funded portion and $0.4 million charged on the unfunded portion on loans. During the three months ended March 31, 2025, a credit loss benefit of $0.3 million on loans was recorded, consisting of $0.7 million charged on the funded portion on loans and a benefit of $1.0 million on the unfunded portion on loans.

Previous wording

For the three months ended September 30, 2024, Advance payments by borrowers for taxes and insurance in the amount of $13.2 million, were reclassified to Savings.

Current wording

For the three months ended March 31, 2025, Advance payments by borrowers for taxes and insurance in the amount of $12.4 million, were reclassified to Savings.